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: 811-08495
NATIONWIDE MUTUAL FUNDS
(Exact name of registrant as specified in charter)
1000 CONTINENTAL DRIVE, SUITE 400, KING OF PRUSSIA, PENNSYLVANIA 19406-2850
(Address of principal executive offices) (Zip code)
Eric E. Miller, Esq.
1000 Continental Drive
Suite 400
King of Prussia, Pennsylvania 19406-2850
(Name and address of agent for service)
Registrants telephone number, including area code: (610) 230-2839
Date of fiscal year end: July 31, 2014
Date of reporting period: August 1, 2013 through July 31, 2014
Form N-CSR is to be used by management investment companies to file reports with the Commission not later than ten (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 the Commissions 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, D. C. 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.
Item 1. Reports to Stockholders.
Include a copy of the report transmitted to stockholders pursuant to Rule 30e-1 under the Act (17 CFR § 270.30e-1).
Annual Report
July 31, 2014
Nationwide Mutual Funds
Equity Funds
Nationwide Bailard Cognitive Value Fund
Nationwide Bailard International Equities Fund
Nationwide Bailard Technology & Science Fund
Nationwide Geneva Mid Cap Growth Fund
Nationwide Geneva Small Cap Growth Fund
Nationwide HighMark Balanced Fund
Nationwide HighMark Large Cap Core Equity Fund
Nationwide HighMark Large Cap Growth Fund
Nationwide HighMark Small Cap Core Fund
Nationwide HighMark Value Fund
Nationwide Ziegler Equity Income Fund
Nationwide Ziegler NYSE Arca Tech 100 Index Fund
Nationwide Funds® |
Commentary in this report is provided by the portfolio manager(s) of each Fund as of the date of this report and is subject to change at any time based on market or other conditions.
Third-party information has been obtained from sources that Nationwide Fund Advisors (NFA), the investment adviser to the Funds, deems reliable. This report and the holdings provided are for informational purposes only and are not intended to be relied on as investment advice. Portfolio composition is accurate as of the date of this report and is subject to change at any time and without notice. NFA, one of its affiliated advisers or its employees may hold a position in the securities in this report.
Statement Regarding Availability of Quarterly Portfolio Holdings.
The Trust files complete schedules of portfolio holdings for each Fund with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year on Form N-Q. Additionally, the Trust files a schedule of portfolio holdings monthly for the Nationwide Money Market Fund on Form N-MFP. Forms N-Q and Forms N-MFP are available on the SECs website at http://www.sec.gov. Forms N-Q and Forms N-MFP may be reviewed and copied at the SECs Public Reference Room in Washington, DC, and information on the operation of the Public Reference Room may be obtained by calling 800-SEC-0330. The Trust also makes this information available to shareholders on nationwide.com/mutualfunds or upon request without charge.
Statement Regarding Availability of Proxy Voting Record.
Information regarding how the Funds voted proxies relating to portfolio securities held during the most recent 12-month period ended June 30 is available without charge, upon request, by calling 800-848-0920, and on the SECs website at http://www.sec.gov.
Nationwide Funds® Annual Report |
Nationwide Funds® |
July 31, 2014
Dear Shareholder,
Watching children board a school bus can teach us a lot about human nature. As the red lights flash and the bus door slides open, some children rush to be first to climb up the steps. Others are hesitant, glancing back for reassurance. A few students freeze in fear, unable to proceed.
We understand that, like the students or anyone facing something daunting, investors vary in their approaches to financial planning. Whether you tend to climb right in, move tentatively or need support to move forward at all, please know that Nationwide Funds represent a range of products and investment strategies designed to suit all types of investors. We continually scan the investment universe seeking opportunities to expand our fund offerings to include potentially attractive asset classes. Our goal is to help provide the investment options you may need to prepare for and live in retirement. As a Nationwide Funds investor, you may be positioned for potential benefits from long-term investment solutions driven by tactical risk management and diversification.
Overall, most Nationwide Funds performed well during the one-year reporting period ended July 31, 2014. Broad U.S. stock market performance as measured by the S&P 500® Index grew 16.94% for the period, with all sectors reporting positive returns. The Barclays U.S. Aggregate Bond Index, a broad measurement of U.S. fixed-income investment performance, returned 3.97% for the one-year period.
Confucius reminds us that Every journey starts with a single step. By working with your financial advisor and investing with Nationwide Funds, you already have climbed that critical first step. We encourage you to stay true to your long-term plan no matter what your circumstances or investment temperament. Your advisor and Nationwide Funds are poised to help.
Sincerely,
Michael S. Spangler
President & CEO
Nationwide Funds
1
Economic Review |
2
Economic Review (cont.) |
3
Fund Commentary | Nationwide Bailard Cognitive Value Fund |
4
Fund Overview | Nationwide Bailard Cognitive Value Fund |
| Percentages indicated are based upon net assets as of July 31, 2014. |
| Percentages indicated are based upon total investments as of July 31, 2014. |
* | For purposes of listing top industries and top holdings, the repurchase agreement is included as part of Other. |
5
Fund Performance | Nationwide Bailard Cognitive Value Fund |
6
Fund Performance (cont.) | Nationwide Bailard Cognitive Value Fund |
Performance of a $10,000 Investment
Investment return and principal value will fluctuate, and when redeemed, shares may be worth more or less than original cost. Past performance is no guarantee of future results and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Investing in mutual funds involves market risk, including loss of principal. Performance returns assume the reinvestment of all distributions.
Comparative performance of $10,000 invested in Class M shares of the Nationwide Bailard Cognitive Value Fund versus the Russell 2000® Value Index (current benchmark), the S&P SmallCap 600 Value Index (former benchmark) and the Consumer Price Index (CPI) over the 10-year period ended 7/31/14. Fund performance prior to the Funds inception on 9/16/13 is based on the Funds predecessor fund. Unlike the Fund, the performance for these unmanaged indexes does not reflect any fees, expenses, or sales charges. One cannot invest directly in a market index. A description of the benchmarks can be found on the Market Index Definitions page at the back of this book.
7
Shareholder Expense Example | Nationwide Bailard Cognitive Value Fund |
Schedule of Shareholder Expenses
Expense Analysis of a $1,000 Investment
Nationwide Bailard Cognitive July 31, 2014 |
Beginning Account Value ($) 02/01/14 |
Ending Account Value ($) 07/31/14 |
Expenses Paid During Period ($) 02/01/14 - 07/31/14 |
Expense Ratio During Period (%) 02/01/14 - 07/31/14 | ||||||||
Class A Shares | Actual | (a) | 1,000.00 | 1,062.60 | 6.55 | 1.28 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,018.45 | 6.41 | 1.28 | |||||||
Class C Shares | Actual | (a) | 1,000.00 | 1,058.60 | 10.21 | 2.00 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,014.88 | 9.99 | 2.00 | |||||||
Class M Shares | Actual | (a) | 1,000.00 | 1,064.50 | 5.07 | 0.99 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,019.89 | 4.96 | 0.99 | |||||||
Institutional Service Class Shares(c) | Actual | (a) | 1,000.00 | 1,063.90 | 5.32 | 1.04 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,019.64 | 5.21 | 1.04 | |||||||
Institutional Class Shares | Actual | (a) | 1,000.00 | 1,063.70 | 5.12 | 1.00 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,019.84 | 5.01 | 1.00 |
(a) | Expenses are equal to the Funds annualized expense ratio multiplied by the average account value from February 1, 2014 through July 31, 2014 multiplied to reflect one-half year period. The expense ratio presented represents a six-month, annualized ratio in accordance with Securities and Exchange Commission guidelines. |
(b) | Represents the hypothetical 5% return before expenses. |
(c) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
8
Statement of Investments
July 31, 2014
Nationwide Bailard Cognitive Value Fund
9
Statement of Investments (Continued)
July 31, 2014
Nationwide Bailard Cognitive Value Fund (Continued)
10
Statement of Investments (Continued)
July 31, 2014
Nationwide Bailard Cognitive Value Fund (Continued)
The accompanying notes are an integral part of these financial statements.
11
Statement of Assets and Liabilities
July 31, 2014
Nationwide Bailard
Cognitive | ||||||
Assets: |
||||||
Investments, at value *(cost $96,799,130) |
$ | 102,254,684 | ||||
Repurchase agreement, at value (cost $4,344,544) |
4,344,544 | |||||
|
|
|||||
Total Investments, at value (total cost $101,143,674) |
106,599,228 | |||||
|
|
|||||
Cash |
1,103,472 | |||||
Dividends receivable |
65,307 | |||||
Security lending income receivable |
4,639 | |||||
Receivable for investments sold |
402,836 | |||||
Receivable for capital shares issued |
43,856 | |||||
Prepaid expenses |
16,776 | |||||
|
|
|||||
Total Assets |
108,236,114 | |||||
|
|
|||||
Liabilities: |
||||||
Payable for investments purchased |
459,510 | |||||
Payable for capital shares redeemed |
306,917 | |||||
Payable upon return of securities loaned (Note 2) |
4,815,000 | |||||
Accrued expenses and other payables: |
||||||
Investment advisory fees |
68,732 | |||||
Fund administration fees |
9,745 | |||||
Distribution fees |
11,397 | |||||
Administrative servicing fees |
1,338 | |||||
Accounting and transfer agent fees |
2,637 | |||||
Trustee fees |
257 | |||||
Custodian fees |
447 | |||||
Compliance program costs (Note 3) |
1,352 | |||||
Professional fees |
22,970 | |||||
Printing fees |
4,427 | |||||
Other |
3,592 | |||||
|
|
|||||
Total Liabilities |
5,708,321 | |||||
|
|
|||||
Net Assets |
$ | 102,527,793 | ||||
|
|
|||||
Represented by: |
||||||
Capital |
$ | 89,353,813 | ||||
Accumulated undistributed net investment income |
102,851 | |||||
Accumulated net realized gains from investments |
7,615,575 | |||||
Net unrealized appreciation/(depreciation) from investments |
5,455,554 | |||||
|
|
|||||
Net Assets |
$ | 102,527,793 | ||||
|
|
|||||
Net Assets: |
||||||
Class A Shares |
$ | 1,102,616 | ||||
Class C Shares |
12,501,150 | |||||
Class M Shares |
88,479,981 | |||||
Institutional Service Class Shares |
433,029 | |||||
Institutional Class Shares |
11,017 | |||||
|
|
|||||
Total |
$ | 102,527,793 | ||||
|
|
|||||
* | Includes value of securities on loan of $4,711,266 (Note 2). |
12
Statement of Assets and Liabilities (Continued)
July 31, 2014
Nationwide Bailard Cognitive Value Fund | ||||||
Shares Outstanding (unlimited number of shares authorized): |
||||||
Class A Shares |
83,307 | |||||
Class C Shares |
988,336 | |||||
Class M Shares |
6,705,048 | |||||
Institutional Service Class Shares |
32,766 | |||||
Institutional Class Shares |
835 | |||||
|
|
|||||
Total |
7,810,292 | |||||
|
|
|||||
Net asset value and redemption price per share (Net assets by class divided by shares outstanding by class, respectively): |
||||||
Class A Shares (a) |
$ | 13.24 | ||||
Class C Shares (b) |
$ | 12.65 | ||||
Class M Shares |
$ | 13.20 | ||||
Institutional Service Class Shares |
$ | 13.22 | ||||
Institutional Class Shares |
$ | 13.19 | ||||
Maximum offering price per share (100%/(100%-maximum sales charge) of net asset value adjusted to the nearest cent): |
||||||
Class A Shares |
$ | 14.05 | ||||
|
|
|||||
Maximum Sales Charge: |
||||||
Class A Shares |
5.75 | % | ||||
|
|
|||||
(a) | For Class A Shares, the redemption price per share is reduced by 1.00% on sales of shares of original purchases of $1,000,000 or more or that were not subject to a front-end sales charge made within 18 months of the purchase date. |
(b) | For Class C Shares, the redemption price per share is reduced by 1.00% for shares held less than one year. |
The accompanying notes are an integral part of these financial statements.
13
Statement of Operations
For the Year Ended July 31, 2014
Nationwide Bailard Cognitive Value Fund | ||||||
INVESTMENT INCOME: |
||||||
Dividend income |
$ | 1,930,085 | ||||
Interest income |
39 | |||||
Income from securities lending (Note 2) |
19,165 | |||||
Foreign tax withholding |
(2,728 | ) | ||||
|
|
|||||
Total Income |
1,946,561 | |||||
|
|
|||||
EXPENSES: |
||||||
Investment advisory fees |
788,408 | |||||
Fund administration fees |
130,275 | |||||
Distribution fees Class A |
2,822 | |||||
Distribution fees Class C |
104,128 | |||||
Administrative servicing fees Class A |
1,422 | |||||
Administrative servicing fees Class C |
324 | |||||
Administrative servicing fees Institutional Service Class (a) |
1,939 | |||||
Registration and filing fees |
56,519 | |||||
Professional fees |
34,026 | |||||
Printing fees |
15,605 | |||||
Trustee fees |
2,672 | |||||
Custodian fees |
4,123 | |||||
Accounting and transfer agent fees |
9,849 | |||||
Compliance program costs (Note 3) |
1,748 | |||||
Other |
12,913 | |||||
|
|
|||||
Total expenses before earnings credit, fees waived, and expenses reimbursed |
1,166,773 | |||||
|
|
|||||
Earnings credit (Note 5) |
(150 | ) | ||||
Administrative servicing fees voluntarily waived Class A (Note 3) |
(141 | ) | ||||
Administrative servicing fees voluntarily waived Institutional Service Class (Note 3) (a) |
(235 | ) | ||||
Expenses reimbursed by adviser (Note 3) |
(3,943 | ) | ||||
|
|
|||||
Net Expenses |
1,162,304 | |||||
|
|
|||||
NET INVESTMENT INCOME |
784,257 | |||||
|
|
|||||
REALIZED/UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: |
||||||
Net realized gains from investment transactions |
10,481,797 | |||||
Net change in unrealized appreciation/(depreciation) from investments |
(922,140 | ) | ||||
|
|
|||||
Net realized/unrealized gains from investments |
9,559,657 | |||||
|
|
|||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS |
$ | 10,343,914 | ||||
|
|
|||||
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
The accompanying notes are an integral part of these financial statements.
14
Statements of Changes in Net Assets
Nationwide Bailard Cognitive Value Fund | ||||||||||||
Year Ended July 31, 2014 |
Year
Ended July 31, 2013 | |||||||||||
Operations: |
||||||||||||
Net investment income |
$ | 784,257 | $ | 1,330,136 | ||||||||
Net realized gains from investments |
10,481,797 | 22,104,698 | ||||||||||
Net change in unrealized appreciation/(depreciation) from investments |
(922,140 | ) | 1,516,351 | |||||||||
|
|
|
|
|||||||||
Change in net assets resulting from operations |
10,343,914 | 24,951,185 | ||||||||||
|
|
|
|
|||||||||
Distributions to Shareholders From: |
||||||||||||
Net investment income: |
||||||||||||
Class A |
(8,779 | ) | (5,466 | ) | ||||||||
Class C |
(142,234 | ) | (1,418 | ) | ||||||||
Class M |
(1,159,326 | ) | (975,185 | ) | ||||||||
Institutional Service Class (a) |
(12,903 | ) | (35,776 | ) | ||||||||
Institutional Class |
(129 | )(b) | | |||||||||
Net realized gains: |
||||||||||||
Class A |
(204,658 | ) | | |||||||||
Class C |
(2,644,093 | ) | | |||||||||
Class M |
(17,530,044 | ) | | |||||||||
Institutional Service Class (a) |
(246,368 | ) | | |||||||||
Institutional Class |
(1,945 | )(b) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from shareholder distributions |
(21,950,479 | ) | (1,017,845 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
17,352,778 | (9,217,565 | ) | |||||||||
|
|
|
|
|||||||||
Change in net assets |
5,746,213 | 14,715,775 | ||||||||||
|
|
|
|
|||||||||
Net Assets: |
||||||||||||
Beginning of year |
96,781,580 | 82,065,805 | ||||||||||
|
|
|
|
|||||||||
End of year |
$ | 102,527,793 | $ | 96,781,580 | ||||||||
|
|
|
|
|||||||||
Accumulated undistributed net investment income at end of year |
$ | 102,851 | $ | 509,622 | ||||||||
|
|
|
|
|||||||||
CAPITAL TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
$ | 316,147 | $ | 493,322 | (c) | |||||||
Dividends reinvested |
187,155 | 4,699 | ||||||||||
Cost of shares redeemed |
(413,516 | ) | (205,914 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
89,786 | 292,107 | ||||||||||
|
|
|
|
|||||||||
Class C Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
15,698,391 | 125,270 | (c) | |||||||||
Dividends reinvested |
2,776,516 | 1,190 | ||||||||||
Cost of shares redeemed |
(4,562,217 | ) | (102,342 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
13,912,690 | 24,118 | ||||||||||
|
|
|
|
|||||||||
Class M Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
7,493,203 | 6,055,974 | (c) | |||||||||
Dividends reinvested |
16,892,388 | 866,070 | ||||||||||
Cost of shares redeemed |
(19,651,113 | ) | (12,514,797 | ) | ||||||||
|
|
|
|
|||||||||
Total Class M Shares |
4,734,478 | (5,592,753 | ) | |||||||||
|
|
|
|
|||||||||
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(b) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
(c) | Includes redemption fees. See Note 4 for further information. |
15
Statements of Changes in Net Assets (Continued)
Nationwide Bailard Cognitive Value Fund | ||||||||||||
Year Ended July 31, 2014 |
Year
Ended July 31, 2013 | |||||||||||
CAPITAL TRANSACTIONS: (continued) |
||||||||||||
Institutional Service Class Shares (Note 12)(a) |
||||||||||||
Proceeds from shares issued |
$ | 64,180 | $ | 1,303,454 | (c) | |||||||
Dividends reinvested |
234,018 | 30,635 | ||||||||||
Cost of shares redeemed |
(1,694,448 | ) | (5,275,126 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
(1,396,250 | ) | (3,941,037 | ) | ||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Proceeds from shares issued |
10,000 | (b) | | |||||||||
Dividends reinvested |
2,074 | (b) | | |||||||||
Cost of shares redeemed |
| (b) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
12,074 | (b) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
$ | 17,352,778 | $ | (9,217,565 | ) | |||||||
|
|
|
|
|||||||||
SHARE TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Issued |
23,095 | 36,204 | ||||||||||
Reinvested |
15,020 | 383 | ||||||||||
Redeemed |
(29,775 | ) | (15,249 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
8,340 | 21,338 | ||||||||||
|
|
|
|
|||||||||
Class C Shares (Note 12) |
||||||||||||
Issued |
1,069,693 | 9,595 | ||||||||||
Reinvested |
232,150 | 100 | ||||||||||
Redeemed |
(351,995 | ) | (7,810 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
949,848 | 1,885 | ||||||||||
|
|
|
|
|||||||||
Class M Shares (Note 12) |
||||||||||||
Issued |
548,913 | 455,168 | ||||||||||
Reinvested |
1,360,746 | 70,873 | ||||||||||
Redeemed |
(1,436,347 | ) | (922,037 | ) | ||||||||
|
|
|
|
|||||||||
Total Class M Shares |
473,312 | (395,996 | ) | |||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 12)(a) |
||||||||||||
Issued |
5,024 | 98,683 | ||||||||||
Reinvested |
18,826 | 2,507 | ||||||||||
Redeemed |
(120,659 | ) | (412,288 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
(96,809 | ) | (311,098 | ) | ||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Issued |
668 | (b) | | |||||||||
Reinvested |
167 | (b) | | |||||||||
Redeemed |
| (b) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
835 | (b) | | |||||||||
|
|
|
|
|||||||||
Total change in shares |
1,335,526 | (683,871 | ) | |||||||||
|
|
|
|
|||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(b) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
(c) | Includes redemption fees. See Note 4 for further information. |
The accompanying notes are an integral part of these financial statements.
16
Financial Highlights
Selected data for each share of capital outstanding throughout the periods indicated
Nationwide Bailard Cognitive Value Fund
Operations | Distributions | Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period |
Net Investment Income (Loss) |
Net
Realized and Unrealized Gains (Losses) from Investments |
Total from Operations |
Net Investment Income |
Net Realized Gains |
Total Distributions |
Redemption Fees |
Net Asset Value, End of Period |
Total Return (a)(b)(c) |
Net Assets at End of Period |
Ratio of Expenses to Average Net Assets (d) |
Ratio of
Net (Loss) |
Ratio of Expenses (Prior to Reimbursements) to Average Net Assets (d)(e) |
Portfolio Turnover (f) |
||||||||||||||||||||||||||||||||||||||||||||||
Class A Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 14.97 | 0.06 | 1.24 | 1.30 | (0.12 | ) | (2.91 | ) | (3.03 | ) | | $ | 13.24 | 10.00% | (h) | $ | 1,102,616 | 1.37% | 0.46% | 1.38% | 286.05% | ||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 11.48 | 0.14 | 3.45 | 3.59 | (0.10 | ) | | (0.10 | ) | | $ | 14.97 | 31.48% | $ | 1,122,377 | 1.47% | 1.09% | 1.58% | 339.00% | ||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 11.51 | 0.03 | (0.01 | ) | 0.02 | (0.05 | ) | | (0.05 | ) | | $ | 11.48 | 0.21% | $ | 615,772 | 1.47% | 0.23% | 1.60% | 268.00% | |||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 9.37 | 0.07 | 2.19 | 2.26 | (0.12 | ) | | (0.12 | ) | | $ | 11.51 | 24.05% | $ | 961,056 | 1.47% | 0.60% | 1.58% | 216.00% | ||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 7.89 | 0.03 | 1.50 | (i) | 1.53 | (0.05 | ) | | (0.05 | ) | | $ | 9.37 | 19.60% | (i) | $ | 654,681 | 1.45% | 0.34% | 1.58% | 152.00% | ||||||||||||||||||||||||||||||||||||||
Class C Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 14.55 | (0.02 | ) | 1.19 | 1.17 | (0.16 | ) | (2.91 | ) | (3.07 | ) | | $ | 12.65 | 9.25% | $ | 12,501,150 | 1.99% | (0.14% | ) | 1.99% | 286.05% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 11.17 | 0.06 | 3.36 | 3.42 | (0.04 | ) | | (0.04 | ) | | $ | 14.55 | 30.67% | $ | 559,903 | 2.07% | 0.49% | 2.08% | 339.00% | ||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 11.20 | (0.04 | ) | 0.01 | (0.03 | ) | | | | | $ | 11.17 | (0.27% | ) | $ | 408,689 | 2.07% | (0.37% | ) | 2.10% | 268.00% | ||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 9.11 | | 2.12 | 2.12 | (0.03 | ) | | (0.03 | ) | | $ | 11.20 | 23.30% | $ | 567,831 | 2.07% | | 2.08% | 216.00% | ||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 7.68 | (0.02 | ) | 1.47 | (i) | 1.45 | (0.02 | ) | | (0.02 | ) | | $ | 9.11 | 18.92% | (i) | $ | 520,057 | 2.05% | (0.26% | ) | 2.08% | 152.00% | ||||||||||||||||||||||||||||||||||||
Class M Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 14.95 | 0.12 | 1.23 | 1.35 | (0.19 | ) | (2.91 | ) | (3.10 | ) | | $ | 13.20 | 10.38% | $ | 88,479,981 | 1.00% | 0.85% | 1.01% | 286.05% | |||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 11.47 | 0.19 | 3.44 | 3.63 | (0.15 | ) | | (0.15 | ) | | $ | 14.95 | 31.94% | $ | 93,162,527 | 1.07% | 1.49% | 1.08% | 339.00% | ||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 11.51 | 0.07 | | 0.07 | (0.11 | ) | | (0.11 | ) | | $ | 11.47 | 0.71% | $ | 75,990,508 | 1.07% | 0.63% | 1.10% | 268.00% | ||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 9.37 | 0.11 | 2.18 | 2.29 | (0.15 | ) | | (0.15 | ) | | $ | 11.51 | 24.54% | $ | 87,921,410 | 1.07% | 1.00% | 1.08% | 216.00% | ||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 7.87 | 0.06 | 1.51 | (i) | 1.57 | (0.07 | ) | | (0.07 | ) | | $ | 9.37 | 20.08% | (i) | $ | 70,390,248 | 1.05% | 0.74% | 1.08% | 152.00% | ||||||||||||||||||||||||||||||||||||||
Institutional Service Class Shares (j) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 14.95 | 0.10 | 1.23 | 1.33 | (0.15 | ) | (2.91 | ) | (3.06 | ) | | $ | 13.22 | 10.23% | (h) | $ | 433,029 | 1.14% | 0.75% | 1.16% | 286.05% | ||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 11.46 | 0.18 | 3.45 | 3.63 | (0.14 | ) | | (0.14 | ) | | $ | 14.95 | 31.93% | $ | 1,936,773 | 1.14% | 1.42% | 1.33% | 339.00% | ||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 11.50 | 0.06 | | 0.06 | (0.10 | ) | | (0.10 | ) | | $ | 11.46 | 0.60% | $ | 5,050,836 | 1.16% | 0.54% | 1.35% | 268.00% | ||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 9.36 | 0.09 | 2.19 | 2.28 | (0.14 | ) | | (0.14 | ) | | $ | 11.50 | 24.32% | $ | 5,075,223 | 1.21% | 0.86% | 1.33% | 216.00% | ||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 7.87 | 0.06 | 1.50 | (i) | 1.56 | (0.07 | ) | | (0.07 | ) | | $ | 9.36 | 20.06% | (i) | $ | 2,230,226 | 1.13% | 0.66% | 1.33% | 152.00% | ||||||||||||||||||||||||||||||||||||||
Institutional Class Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Period Ended July 31, 2014 (g)(k) |
$ | 14.97 | 0.09 | 1.23 | 1.32 | (0.19 | ) | (2.91 | ) | (3.10 | ) | | $ | 13.19 | 10.15% | $ | 11,017 | 0.99% | 0.76% | 0.99% | 286.05% | |||||||||||||||||||||||||||||||||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Excludes sales charge. |
(b) | Not annualized for periods less than one year. |
(c) | Total returns prior to the Funds inception date on September 16, 2013 are based on the perfomance of the Funds predecessor fund. |
(d) | Annualized for periods less than one year. |
(e) | During the period, certain fees may have been waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(f) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(g) | Per share calculations were performed using average shares method. |
(h) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset values for financial reporting purposes and the returns based upon those net asset values may differ from the net asset values and returns for shareholder transactions. |
(i) | Includes payment by affiliates of $0.001 per share. The effects of such payments did not affect the amount shown as total return for the period. |
(j) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(k) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. Total return is calculated based on inception date of September 18, 2013 through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
17
Fund Commentary | Nationwide Bailard International Equities Fund |
18
Fund Commentary (cont.) | Nationwide Bailard International Equities Fund |
19
Fund Overview | Nationwide Bailard International Equities Fund |
| Percentages indicated are based upon net assets as of July 31, 2014. |
| Percentages indicated are based upon total investments as of July 31, 2014. |
* | For purposes of listing top industries, top holdings and top countries, the repurchase agreement is included as part of Other. |
20
Fund Performance | Nationwide Bailard International Equities Fund |
21
Fund Performance (cont.) | Nationwide Bailard International Equities Fund |
Performance of a $10,000 Investment
Investment return and principal value will fluctuate, and when redeemed, shares may be worth more or less than original cost. Past performance is no guarantee of future results and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Investing in mutual funds involves market risk, including loss of principal. Performance returns assume the reinvestment of all distributions.
Comparative performance of $10,000 invested in Class M shares of the Nationwide Bailard International Equities Fund versus the MSCI EAFE® Index (current benchmark), the MSCI ACWI ex USA (former benchmark) and the Consumer Price Index (CPI) over the 10-year period ended 7/31/14. Fund performance prior to the Funds inception on 9/16/13 is based on the Funds predecessor fund. Unlike the Fund, the performance for these unmanaged indexes does not reflect any fees, expenses, or sales charges. One cannot invest directly in a market index. A description of the benchmarks can be found on the Market Index Definitions page at the back of this book.
22
Shareholder Expense Example | Nationwide Bailard International Equities Fund |
Schedule of Shareholder Expenses
Expense Analysis of a $1,000 Investment
Nationwide Bailard International July 31, 2014 |
Beginning Account Value ($) 02/01/14 |
Ending Account Value ($) 07/31/14 |
Expenses Paid During Period ($) 02/01/14 - 07/31/14 |
Expense Ratio During Period (%) 02/01/14 - 07/31/14 | ||||||||
Class A Shares | Actual | (a) | 1,000.00 | 1,053.80 | 5.96 | 1.17 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,018.99 | 5.86 | 1.17 | ||||||||
Class C Shares | Actual | (a) | 1,000.00 | 1,050.20 | 9.86 | 1.94 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,015.17 | 9.69 | 1.94 | ||||||||
Class M Shares | Actual | (a) | 1,000.00 | 1,055.10 | 4.43 | 0.87 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,020.48 | 4.36 | 0.87 | ||||||||
Institutional Service Class Shares(c) | Actual | (a) | 1,000.00 | 1,055.20 | 4.64 | 0.91 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,020.28 | 4.56 | 0.91 | ||||||||
Institutional Class Shares | Actual | (a) | 1,000.00 | 1,055.20 | 4.38 | 0.86 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,020.53 | 4.31 | 0.86 |
(a) | Expenses are equal to the Funds annualized expense ratio multiplied by the average account value from February 1, 2014 through July 31, 2014 multiplied to reflect one-half year period. The expense ratio presented represents a six-month, annualized ratio in accordance with Securities and Exchange Commission guidelines. |
(b) | Represents the hypothetical 5% return before expenses. |
(c) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
23
Statement of Investments
July 31, 2014
Nationwide Bailard International Equities Fund
24
Statement of Investments (Continued)
July 31, 2014
Nationwide Bailard International Equities Fund (Continued)
25
Statement of Investments (Continued)
July 31, 2014
Nationwide Bailard International Equities Fund (Continued)
26
Statement of Investments (Continued)
July 31, 2014
Nationwide Bailard International Equities Fund (Continued)
27
Statement of Investments (Continued)
July 31, 2014
Nationwide Bailard International Equities Fund (Continued)
28
Statement of Investments (Continued)
July 31, 2014
Nationwide Bailard International Equities Fund (Continued)
At July 31, 2014, the Funds open forward foreign currency contracts against the United States Dollar were as follows (Note 2):
Currency | Counterparty | Delivery Date |
Currency Delivered |
Contract Value |
Market Value |
Unrealized Appreciation/ (Depreciation) |
||||||||||||||||||
Short Contracts: |
||||||||||||||||||||||||
Euro | Brown Brothers Harriman & Co. | 08/27/14 | (6,600,000 | ) | $ | (8,992,764 | ) | $ | (8,838,427 | ) | $ | 154,337 | ||||||||||||
Japanese Yen | Brown Brothers Harriman & Co. | 09/19/14 | (2,000,000,000 | ) | (19,593,436 | ) | (19,448,660 | ) | 144,776 | |||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||
Total Short Contracts | $ | (28,586,200 | ) | $ | (28,287,087 | ) | $ | 299,113 | ||||||||||||||||
|
|
|
|
|
|
The accompanying notes are an integral part of these financial statements.
29
Statement of Assets and Liabilities
July 31, 2014
Nationwide Bailard International Equities Fund | ||||||
Assets: |
||||||
Investments, at value* (cost $217,327,744) |
$ | 258,749,179 | ||||
Repurchase agreement, at value (cost $4,617,759) |
4,617,759 | |||||
|
|
|||||
Total Investments, at value (total cost $221,945,503) |
263,366,938 | |||||
|
|
|||||
Cash |
6,310,338 | |||||
Foreign currencies, at value (cost $20,485) |
20,452 | |||||
Dividends receivable |
298,709 | |||||
Security lending income receivable |
7,757 | |||||
Receivable for investments sold |
7,041,012 | |||||
Receivable for capital shares issued |
239,900 | |||||
Reclaims receivable |
376,633 | |||||
Unrealized appreciation on forward foreign currency contracts (Note 2) |
299,113 | |||||
Prepaid expenses |
17,055 | |||||
|
|
|||||
Total Assets |
277,977,907 | |||||
|
|
|||||
Liabilities: |
||||||
Payable for investments purchased |
8,225,340 | |||||
Payable for capital shares redeemed |
2,106 | |||||
Payable upon return of securities loaned (Note 2) |
5,117,800 | |||||
Accrued expenses and other payables: |
||||||
Investment advisory fees |
172,051 | |||||
Fund administration fees |
12,320 | |||||
Distribution fees |
2,524 | |||||
Administrative servicing fees |
37,434 | |||||
Accounting and transfer agent fees |
3,869 | |||||
Trustee fees |
596 | |||||
Deferred capital gain country tax |
80,099 | |||||
Custodian fees |
1,678 | |||||
Compliance program costs (Note 3) |
1,124 | |||||
Professional fees |
27,119 | |||||
Printing fees |
4,990 | |||||
Other |
3,868 | |||||
|
|
|||||
Total Liabilities |
13,692,918 | |||||
|
|
|||||
Net Assets |
$ | 264,284,989 | ||||
|
|
|||||
Represented by: |
||||||
Capital |
$ | 240,727,859 | ||||
Accumulated undistributed net investment income |
6,182,096 | |||||
Accumulated net realized losses from investments, futures, forward and foreign currency transactions |
(24,263,279 | ) | ||||
Net unrealized appreciation/(depreciation) from investments |
41,341,336 | |||||
Net unrealized appreciation/(depreciation) from forward foreign currency contracts (Note 2) |
299,113 | |||||
Net unrealized appreciation/(depreciation) from translation of assets and liabilities denominated in foreign currencies |
(2,136 | ) | ||||
|
|
|||||
Net Assets |
$ | 264,284,989 | ||||
|
|
|||||
* | Includes value of securities on loan of $4,968,850 (Note 2). |
| Net of $80,099 of deferred capital gain country tax. |
30
Statement of Assets and Liabilities (Continued)
July 31, 2014
Nationwide Bailard International | ||||||
Net Assets: |
||||||
Class A Shares |
$ | 3,238,747 | ||||
Class C Shares |
2,088,816 | |||||
Class M Shares |
172,401,379 | |||||
Institutional Service Class Shares |
85,990,498 | |||||
Institutional Class Shares |
565,549 | |||||
|
|
|||||
Total |
$ | 264,284,989 | ||||
|
|
|||||
Shares Outstanding (unlimited number of shares authorized): |
||||||
Class A Shares |
384,690 | |||||
Class C Shares |
249,617 | |||||
Class M Shares |
20,485,815 | |||||
Institutional Service Class Shares |
10,225,716 | |||||
Institutional Class Shares |
67,217 | |||||
|
|
|||||
Total |
31,413,055 | |||||
|
|
|||||
Net asset value and redemption price per share (Net assets by class divided by shares outstanding by class, respectively): |
||||||
Class A Shares (a) |
$ | 8.42 | ||||
Class C Shares (b) |
$ | 8.37 | ||||
Class M Shares |
$ | 8.42 | ||||
Institutional Service Class Shares |
$ | 8.41 | ||||
Institutional Class Shares |
$ | 8.41 | ||||
Maximum offering price per share (100%/(100%-maximum sales charge) of net asset value adjusted to the nearest cent): |
||||||
Class A Shares |
$ | 8.93 | ||||
|
|
|||||
Maximum Sales Charge: |
||||||
Class A Shares |
5.75 | % | ||||
|
|
|||||
(a) | For Class A Shares, the redemption price per share is reduced by 1.00% on sales of shares of original purchases of $1,000,000 or more or that were not subject to a front-end sales charge made within 18 months of the purchase date. |
(b) | For Class C Shares, the redemption price per share is reduced by 1.00% for shares held less than one year. |
The accompanying notes are an integral part of these financial statements.
31
Statement of Operations
For the Year Ended July 31, 2014
Nationwide Bailard International Equities Fund | ||||||
INVESTMENT INCOME: |
||||||
Dividend income |
$ | 8,245,530 | ||||
Income from securities lending (Note 2) |
290,367 | |||||
Foreign tax withholding |
(861,094 | ) | ||||
|
|
|||||
Total Income |
7,674,803 | |||||
|
|
|||||
EXPENSES: |
||||||
Investment advisory fees |
1,853,615 | |||||
Fund administration fees |
175,765 | |||||
Distribution fees Class A |
9,465 | |||||
Distribution fees Class C |
16,303 | |||||
Administrative servicing fees Class A |
5,899 | |||||
Administrative servicing fees Class C |
655 | |||||
Administrative servicing fees Institutional Service Class (a) |
99,962 | |||||
Registration and filing fees |
56,672 | |||||
Professional fees |
53,456 | |||||
Printing fees |
18,292 | |||||
Trustee fees |
6,144 | |||||
Custodian fees |
25,616 | |||||
Accounting and transfer agent fees |
10,343 | |||||
Compliance program costs (Note 3) |
1,866 | |||||
Other |
29,152 | |||||
|
|
|||||
Total expenses before earnings credit, fees waived, and expenses reimbursed |
2,363,205 | |||||
|
|
|||||
Earnings credit (Note 5) |
(223 | ) | ||||
Administrative servicing fees voluntarily waived Class A (Note 3) |
(1,055 | ) | ||||
Administrative servicing fees voluntarily waived Institutional Service Class (Note 3) (a) |
(7,733 | ) | ||||
Expenses reimbursed by adviser (Note 3) |
(5,050 | ) | ||||
|
|
|||||
Net Expenses |
2,349,144 | |||||
|
|
|||||
NET INVESTMENT INCOME |
5,325,659 | |||||
|
|
|||||
REALIZED/UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: |
||||||
Net realized gains from investment transactions |
19,909,477 | |||||
Net realized gains from futures transactions (Note 2) |
114,341 | |||||
Net realized gains from forward and foreign currency transactions (Note 2) |
463,733 | |||||
|
|
|||||
Net realized gains from investments, futures, forward and foreign currency transactions |
20,487,551 | |||||
|
|
|||||
Net change in unrealized appreciation/(depreciation) from investments |
9,003,349 | |||||
Net change in unrealized appreciation/(depreciation) from futures contracts (Note 2) |
(84,595 | ) | ||||
Net change in unrealized appreciation/(depreciation) from forward foreign currency contracts (Note 2) |
582,161 | |||||
Net change in unrealized appreciation/(depreciation) from translation of assets and liabilities denominated in foreign currencies |
(22,628 | ) | ||||
|
|
|||||
Net change in unrealized appreciation/(depreciation) from investments, futures contracts, forward foreign currency contracts, and translation of assets and liabilities denominated in foreign currencies |
9,478,287 | |||||
|
|
|||||
Net realized/unrealized gains from investments, futures, forward and foreign currency transactions, and translation of assets and liabilities denominated in foreign currencies |
29,965,838 | |||||
|
|
|||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS |
$ | 35,291,497 | ||||
|
|
|||||
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
| Net of capital gain country taxes of $11,963. |
| Net of increase in deferred capital gain country tax accrual on unrealized depreciation of $80,099. |
The accompanying notes are an integral part of these financial statements.
32
Statements of Changes in Net Assets
Nationwide Bailard International Equities Fund | ||||||||||||
Year Ended July 31, 2014 |
Year
Ended July 31, 2013 | |||||||||||
Operations: |
||||||||||||
Net investment income |
$ | 5,325,659 | $ | 4,674,601 | ||||||||
Net realized gains from investments, futures, forward and foreign currency transactions |
20,487,551 | 12,360,956 | ||||||||||
Net change in unrealized appreciation/(depreciation) from investments, futures contracts, forward foreign currency contracts, and translation of assets and liabilities denominated in foreign currencies |
9,478,287 | 21,360,062 | ||||||||||
|
|
|
|
|||||||||
Change in net assets resulting from operations |
35,291,497 | 38,395,619 | ||||||||||
|
|
|
|
|||||||||
Distributions to Shareholders From: |
||||||||||||
Net investment income: |
||||||||||||
Class A |
(81,222 | ) | (50,144 | ) | ||||||||
Class C |
(17,079 | ) | (7,450 | ) | ||||||||
Class M |
(3,735,701 | ) | (2,633,788 | ) | ||||||||
Institutional Service Class (a) |
(1,435,087 | ) | (1,189,568 | ) | ||||||||
Institutional Class |
(231 | )(b) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from shareholder distributions |
(5,269,320 | ) | (3,880,950 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
19,788,821 | (10,857,206 | ) | |||||||||
|
|
|
|
|||||||||
Change in net assets |
49,810,998 | 23,657,463 | ||||||||||
|
|
|
|
|||||||||
Net Assets: |
||||||||||||
Beginning of year |
214,473,991 | 190,816,528 | ||||||||||
|
|
|
|
|||||||||
End of year |
$ | 264,284,989 | $ | 214,473,991 | ||||||||
|
|
|
|
|||||||||
Accumulated undistributed net investment income at end of year |
$ | 6,182,096 | $ | 4,542,327 | ||||||||
|
|
|
|
|||||||||
CAPITAL TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
$ | 1,296,717 | $ | 1,714,811 | (c) | |||||||
Dividends reinvested |
75,925 | 43,775 | ||||||||||
Cost of shares redeemed |
(2,857,523 | ) | (1,484,760 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
(1,484,881 | ) | 273,826 | |||||||||
|
|
|
|
|||||||||
Class C Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
993,880 | 141,363 | (c) | |||||||||
Dividends reinvested |
15,435 | 6,555 | ||||||||||
Cost of shares redeemed |
(254,673 | ) | (363,280 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
754,642 | (215,362 | ) | |||||||||
|
|
|
|
|||||||||
Class M Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
14,549,643 | 14,021,008 | (c) | |||||||||
Dividends reinvested |
3,344,102 | 2,300,833 | ||||||||||
Cost of shares redeemed |
(14,872,680 | ) | (13,903,604 | ) | ||||||||
|
|
|
|
|||||||||
Total Class M Shares |
3,021,065 | 2,418,237 | ||||||||||
|
|
|
|
|||||||||
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(b) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
(c) | Includes redemption fees. See Note 4 for further information. |
33
Statements of Changes in Net Assets (Continued)
Nationwide Bailard International Equities Fund | ||||||||||||
Year Ended July 31, 2014 |
Year
Ended July 31, 2013 | |||||||||||
CAPITAL TRANSACTIONS: (continued) |
||||||||||||
Institutional Service Class Shares (Note 12)(a) |
||||||||||||
Proceeds from shares issued |
$ | 28,664,343 | $ | 18,806,412 | (c) | |||||||
Dividends reinvested |
491,055 | 460,313 | ||||||||||
Cost of shares redeemed |
(12,206,688 | ) | (32,600,632 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
16,948,710 | (13,333,907 | ) | |||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Proceeds from shares issued |
986,922 | (b) | | |||||||||
Dividends reinvested |
231 | (b) | | |||||||||
Cost of shares redeemed |
(437,868 | )(b) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
549,285 | (b) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
$ | 19,788,821 | $ | (10,857,206 | ) | |||||||
|
|
|
|
|||||||||
SHARE TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Issued |
157,349 | 242,887 | ||||||||||
Reinvested |
9,599 | 6,353 | ||||||||||
Redeemed |
(350,983 | ) | (208,284 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
(184,035 | ) | 40,956 | |||||||||
|
|
|
|
|||||||||
Class C Shares (Note 12) |
||||||||||||
Issued |
120,551 | 19,970 | ||||||||||
Reinvested |
1,954 | 954 | ||||||||||
Redeemed |
(30,963 | ) | (52,939 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
91,542 | (32,015 | ) | |||||||||
|
|
|
|
|||||||||
Class M Shares (Note 12) |
||||||||||||
Issued |
1,798,547 | 1,959,519 | ||||||||||
Reinvested |
423,840 | 335,398 | ||||||||||
Redeemed |
(1,801,419 | ) | (1,942,751 | ) | ||||||||
|
|
|
|
|||||||||
Total Class M Shares |
420,968 | 352,166 | ||||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 12)(a) |
||||||||||||
Issued |
3,479,364 | 2,671,833 | ||||||||||
Reinvested |
62,238 | 67,003 | ||||||||||
Redeemed |
(1,496,688 | ) | (4,608,686 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
2,044,914 | (1,869,850 | ) | |||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Issued |
118,100 | (b) | | |||||||||
Reinvested |
29 | (b) | | |||||||||
Redeemed |
(50,912 | )(b) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
67,217 | (b) | | |||||||||
|
|
|
|
|||||||||
Total change in shares |
2,440,606 | (1,508,743 | ) | |||||||||
|
|
|
|
|||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(b) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
(c) | Includes redemption fees. See Note 4 for further information. |
The accompanying notes are an integral part of these financial statements.
34
Financial Highlights
Selected data for each share of capital outstanding throughout the periods indicated
Nationwide Bailard International Equities Fund
Operations | Distributions | Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period |
Net Investment Income |
Net
Realized and Unrealized Gains (Losses) from Investments |
Total from Operations |
Net Investment Income |
Total Distributions |
Redemption Fees |
Net Asset Value, End of Period |
Total Return (a)(b)(c) |
Net Assets at End of Period |
Ratio of Expenses to Average Net Assets (d) |
Ratio of
Net Investment Income to Average Net Assets (d) |
Ratio of Expenses (Prior to Reimbursements) to Average Net Assets (d)(e) |
Portfolio Turnover (f) |
|||||||||||||||||||||||||||||||||||||||||||
Class A Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 7.41 | 0.14 | 1.03 | 1.17 | (0.16 | ) | (0.16 | ) | | $ | 8.42 | 15.92% | $ | 3,238,747 | 1.29% | 1.69% | 1.32% | 83.79% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 6.27 | 0.14 | 1.11 | 1.25 | (0.11 | ) | (0.11 | ) | | $ | 7.41 | 20.04% | $ | 4,216,776 | 1.38% | 1.94% | 1.58% | 97.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 7.45 | 0.13 | (1.15 | ) | (1.02 | ) | (0.16 | ) | (0.16 | ) | | $ | 6.27 | (13.57% | ) | $ | 3,306,852 | 1.49% | 2.04% | 1.67% | 102.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 6.32 | 0.11 | 1.14 | 1.25 | (0.12 | ) | (0.12 | ) | | $ | 7.45 | 20.05% | $ | 5,066,564 | 1.62% | 1.52% | 1.77% | 95.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 5.98 | 0.08 | 0.40 | 0.48 | (0.14 | ) | (0.14 | ) | | $ | 6.32 | 8.04% | $ | 6,692,942 | 1.60% | 1.28% | 1.78% | 84.00% | |||||||||||||||||||||||||||||||||||||
Class C Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 7.37 | 0.11 | 1.00 | 1.11 | (0.11 | ) | (0.11 | ) | | $ | 8.37 | 15.12% | $ | 2,088,816 | 1.93% | 1.31% | 1.94% | 83.79% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 6.22 | 0.09 | 1.11 | 1.20 | (0.05 | ) | (0.05 | ) | | $ | 7.37 | 19.28% | $ | 1,164,820 | 2.08% | 1.24% | 2.08% | 97.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 7.37 | 0.08 | (1.13 | ) | (1.05 | ) | (0.10 | ) | (0.10 | ) | | $ | 6.22 | (14.07% | ) | $ | 1,181,621 | 2.17% | 1.36% | 2.17% | 102.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 6.26 | 0.06 | 1.13 | 1.19 | (0.08 | ) | (0.08 | ) | | $ | 7.37 | 19.16% | $ | 2,289,773 | 2.27% | 0.87% | 2.27% | 95.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 5.92 | 0.04 | 0.39 | 0.43 | (0.09 | ) | (0.09 | ) | | $ | 6.26 | 7.39% | $ | 1,974,951 | 2.28% | 0.60% | 2.28% | 84.00% | |||||||||||||||||||||||||||||||||||||
Class M Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 7.40 | 0.18 | 1.02 | 1.20 | (0.18 | ) | (0.18 | ) | | $ | 8.42 | 16.42% | $ | 172,401,379 | 0.90% | 2.19% | 0.90% | 83.79% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 6.26 | 0.16 | 1.12 | 1.28 | (0.14 | ) | (0.14 | ) | | $ | 7.40 | 20.53% | $ | 148,561,732 | 1.08% | 2.24% | 1.08% | 97.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 7.47 | 0.15 | (1.16 | ) | (1.01 | ) | (0.20 | ) | (0.20 | ) | | $ | 6.26 | (13.28% | ) | $ | 123,438,593 | 1.17% | 2.36% | 1.17% | 102.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 6.34 | 0.13 | 1.15 | 1.28 | (0.15 | ) | (0.15 | ) | | $ | 7.47 | 20.39% | $ | 150,887,844 | 1.27% | 1.87% | 1.27% | 95.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 6.00 | 0.10 | 0.40 | 0.50 | (0.16 | ) | (0.16 | ) | | $ | 6.34 | 8.31% | $ | 133,320,908 | 1.28% | 1.60% | 1.28% | 84.00% | |||||||||||||||||||||||||||||||||||||
Institutional Service Class Shares (h) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 7.40 | 0.17 | 1.01 | 1.18 | (0.17 | ) | (0.17 | ) | | $ | 8.41 | 16.13% | $ | 85,990,498 | 1.02% | 2.12% | 1.04% | 83.79% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 6.26 | 0.15 | 1.11 | 1.26 | (0.12 | ) | (0.12 | ) | | $ | 7.40 | 20.34% | $ | 60,530,663 | 1.21% | 2.11% | 1.33% | 97.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 7.46 | 0.14 | (1.16 | ) | (1.02 | ) | (0.18 | ) | (0.18 | ) | | $ | 6.26 | (13.35% | ) | $ | 62,889,462 | 1.31% | 2.21% | 1.42% | 102.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 6.33 | 0.12 | 1.15 | 1.27 | (0.14 | ) | (0.14 | ) | | $ | 7.46 | 20.25% | $ | 93,100,614 | 1.45% | 1.69% | 1.52% | 95.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 6.00 | 0.09 | 0.39 | 0.48 | (0.15 | ) | (0.15 | ) | | $ | 6.33 | 8.03% | $ | 79,236,673 | 1.44% | 1.44% | 1.53% | 84.00% | |||||||||||||||||||||||||||||||||||||
Institutional Class Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Period Ended July 31, 2014 (g)(i) |
$ | 7.91 | 0.18 | 0.50 | 0.68 | (0.18 | ) | (0.18 | ) | | $ | 8.41 | 8.78% | $ | 565,549 | 0.86% | 2.39% | 0.86% | 83.79% | |||||||||||||||||||||||||||||||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Excludes sales charge. |
(b) | Not annualized for periods less than one year. |
(c) | Total returns prior to the Funds inception on September 16, 2013 are based on the performance of the Funds predecessor fund. |
(d) | Annualized for periods less than one year. |
(e) | During the period, certain fees may have been waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(f) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(g) | Per share calculations were performed using average shares method. |
(h) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(i) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. Total return is calculated based on inception date of September 18, 2013 through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
35
Fund Commentary | Nationwide Bailard Technology & Science Fund |
36
Fund Commentary (cont.) | Nationwide Bailard Technology & Science Fund |
37
Fund Overview | Nationwide Bailard Technology & Science Fund |
| Percentages indicated are based upon net assets as of July 31, 2014. |
| Percentages indicated are based upon total investments as of July 31, 2014. |
38
Fund Performance | Nationwide Bailard Technology & Science Fund |
39
Fund Performance (cont.) | Nationwide Bailard Technology & Science Fund |
Performance of a $10,000 Investment
Investment return and principal value will fluctuate, and when redeemed, shares may be worth more or less than original cost. Past performance is no guarantee of future results and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Investing in mutual funds involves market risk, including loss of principal. Performance returns assume the reinvestment of all distributions.
Comparative performance of $10,000 invested in Class M shares of the Nationwide Bailard Technology & Science Fund versus the S&P North American (NA) Technology Sector IndexTM (current benchmark), the NASDAQ-100 Index (former benchmark) and the Consumer Price Index (CPI) over the 10-year period ended 7/31/14. Fund performance prior to the Funds inception on 9/16/13 is based on the Funds predecessor fund. Unlike the Fund, the performance for these unmanaged indexes does not reflect any fees, expenses, or sales charges. One cannot invest directly in a market index. A description of the benchmarks can be found on the Market Index Definitions page at the back of this book.
40
Shareholder Expense Example | Nationwide Bailard Technology & Science Fund |
Schedule of Shareholder Expenses
Expense Analysis of a $1,000 Investment
Nationwide Bailard July 31, 2014 |
Beginning Account Value ($) 02/01/14 |
Ending Account Value ($) 07/31/14 |
Expenses Paid During Period ($) 02/01/14 - 07/31/14 |
Expense Ratio During Period (%) 02/01/14 - 07/31/14 | ||||||||
Class A Shares | Actual | (a) | 1,000.00 | 1,067.10 | 6.87 | 1.34 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,018.15 | 6.71 | 1.34 | |||||||
Class C Shares | Actual | (a) | 1,000.00 | 1,063.50 | 10.69 | 2.09 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,014.43 | 10.44 | 2.09 | |||||||
Class M Shares | Actual | (a) | 1,000.00 | 1,069.70 | 4.98 | 0.97 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,019.98 | 4.86 | 0.97 | |||||||
Institutional Service Class Shares(c) | Actual | (a) | 1,000.00 | 1,067.80 | 6.10 | 1.19 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,018.89 | 5.96 | 1.19 | |||||||
Institutional Class Shares | Actual | (d) | 1,000.00 | 1,069.20 | 4.87 | 0.95 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,020.08 | 4.76 | 0.95 |
(a) | Expenses are equal to the Funds annualized expense ratio multiplied by the average account value from February 1, 2014 through July 31, 2014 multiplied to reflect one-half year period. The expense ratio presented represents a six-month, annualized ratio in accordance with Securities and Exchange Commission guidelines. |
(b) | Represents the hypothetical 5% return before expenses. |
(c) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(d) | Actual expenses are equal to the Funds annualized expense ratio multiplied by the average account value from September 19, 2013 through July 31, 2014 to reflect the period from commencement of operations. |
41
Statement of Investments
July 31, 2014
Nationwide Bailard Technology & Science Fund
42
Statement of Investments (Continued)
July 31, 2014
Nationwide Bailard Technology & Science Fund (Continued)
The accompanying notes are an integral part of these financial statements.
43
Statement of Assets and Liabilities
July 31, 2014
Nationwide Bailard Technology & Science Fund | ||||||
Assets: |
||||||
Investments, at value (cost $54,742,591) |
$ | 100,175,662 | ||||
Cash |
717,938 | |||||
Dividends receivable |
7,139 | |||||
Receivable for capital shares issued |
2,060 | |||||
Prepaid expenses |
15,905 | |||||
|
|
|||||
Total Assets |
100,918,704 | |||||
|
|
|||||
Liabilities: |
||||||
Payable for capital shares redeemed |
7,324 | |||||
Accrued expenses and other payables: |
||||||
Investment advisory fees |
66,112 | |||||
Fund administration fees |
8,934 | |||||
Distribution fees |
904 | |||||
Administrative servicing fees |
801 | |||||
Accounting and transfer agent fees |
799 | |||||
Trustee fees |
229 | |||||
Custodian fees |
442 | |||||
Compliance program costs (Note 3) |
1,372 | |||||
Professional fees |
22,304 | |||||
Printing fees |
3,205 | |||||
Other |
3,566 | |||||
|
|
|||||
Total Liabilities |
115,992 | |||||
|
|
|||||
Net Assets |
$ | 100,802,712 | ||||
|
|
|||||
Represented by: |
||||||
Capital |
$ | 49,843,745 | ||||
Accumulated undistributed net investment income |
12,056 | |||||
Accumulated net realized gains from investments |
5,513,840 | |||||
Net unrealized appreciation/(depreciation) from investments |
45,433,071 | |||||
|
|
|||||
Net Assets |
$ | 100,802,712 | ||||
|
|
|||||
Net Assets: |
||||||
Class A Shares |
$ | 2,192,132 | ||||
Class C Shares |
498,395 | |||||
Class M Shares |
96,832,238 | |||||
Institutional Service Class Shares |
1,203,010 | |||||
Institutional Class Shares |
76,937 | |||||
|
|
|||||
Total |
$ | 100,802,712 | ||||
|
|
|||||
Shares Outstanding (unlimited number of shares authorized): |
||||||
Class A Shares |
132,638 | |||||
Class C Shares |
31,663 | |||||
Class M Shares |
5,683,788 | |||||
Institutional Service Class Shares |
70,770 | |||||
Institutional Class Shares |
4,525 | |||||
|
|
|||||
Total |
5,923,384 | |||||
|
|
|||||
44
Statement of Assets and Liabilities (Continued)
July 31, 2014
Nationwide Bailard Technology & Science Fund | ||||||
Net asset value and redemption price per share (Net assets by class divided by shares outstanding by class, respectively): |
||||||
Class A Shares (a) |
$ | 16.53 | ||||
Class C Shares (b) |
$ | 15.74 | ||||
Class M Shares |
$ | 17.04 | ||||
Institutional Service Class Shares |
$ | 17.00 | ||||
Institutional Class Shares |
$ | 17.00 | ||||
Maximum offering price per share (100%/(100%-maximum sales charge) of net asset value adjusted to the nearest cent): |
||||||
Class A Shares |
$ | 17.54 | ||||
|
|
|||||
Maximum Sales Charge: |
||||||
Class A Shares |
5.75 | % | ||||
|
|
|||||
(a) | For Class A Shares, the redemption price per share is reduced by 1.00% on sales of shares of original purchases of $1,000,000 or more or that were not subject to a front-end sales charge made within 18 months of the purchase date. |
(b) | For Class C Shares, the redemption price per share is reduced by 1.00% for shares held less than one year. |
The accompanying notes are an integral part of these financial statements.
45
Statement of Operations
For the Year Ended July 31, 2014
Nationwide Bailard | ||||||
INVESTMENT INCOME: |
||||||
Dividend income |
$ | 1,157,549 | ||||
Interest income |
47 | |||||
Foreign tax withholding |
(687 | ) | ||||
|
|
|||||
Total Income |
1,156,909 | |||||
|
|
|||||
EXPENSES: |
||||||
Investment advisory fees |
743,777 | |||||
Fund administration fees |
116,873 | |||||
Distribution fees Class A |
4,558 | |||||
Distribution fees Class C |
4,761 | |||||
Administrative servicing fees Class A |
2,666 | |||||
Administrative servicing fees Class C |
297 | |||||
Administrative servicing fees Institutional Service Class (a) |
2,531 | |||||
Registration and filing fees |
55,040 | |||||
Professional fees |
33,037 | |||||
Printing fees |
12,092 | |||||
Trustee fees |
2,472 | |||||
Custodian fees |
3,807 | |||||
Accounting and transfer agent fees |
3,268 | |||||
Compliance program costs (Note 3) |
1,747 | |||||
Other |
14,172 | |||||
|
|
|||||
Total expenses before earnings credit, fees waived, and expenses reimbursed |
1,001,098 | |||||
|
|
|||||
Earnings credit (Note 5) |
(63 | ) | ||||
Administrative servicing fees voluntarily waived Class A (Note 3) |
(193 | ) | ||||
Administrative servicing fees voluntarily waived Institutional Service Class (Note 3) (a) |
(189 | ) | ||||
Expenses reimbursed by adviser (Note 3) |
(5,440 | ) | ||||
|
|
|||||
Net Expenses |
995,213 | |||||
|
|
|||||
NET INVESTMENT INCOME |
161,696 | |||||
|
|
|||||
REALIZED/UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: |
||||||
Net realized gains from investment transactions |
11,482,923 | |||||
Net change in unrealized appreciation/(depreciation) from investments |
8,574,027 | |||||
|
|
|||||
Net realized/unrealized gains from investments |
20,056,950 | |||||
|
|
|||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS |
$ | 20,218,646 | ||||
|
|
|||||
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
The accompanying notes are an integral part of these financial statements.
46
Statements of Changes in Net Assets
Nationwide Bailard Technology & Science Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
Operations: |
||||||||||||
Net investment income |
$ | 161,696 | $ | 215,422 | ||||||||
Net realized gains from investments |
11,482,923 | 5,772,714 | ||||||||||
Net change in unrealized appreciation/(depreciation) from investments |
8,574,027 | 7,636,756 | ||||||||||
|
|
|
|
|||||||||
Change in net assets resulting from operations |
20,218,646 | 13,624,892 | ||||||||||
|
|
|
|
|||||||||
Distributions to Shareholders From: |
||||||||||||
Net investment income: |
||||||||||||
Class A |
| | ||||||||||
Class C |
| | ||||||||||
Class M |
(201,450 | ) | | |||||||||
Institutional Service Class (a) |
(708 | ) | | |||||||||
Institutional Class |
(22 | )(b) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from shareholder distributions |
(202,180 | ) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
(9,275,092 | ) | (4,517,352 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets |
10,741,374 | 9,107,540 | ||||||||||
|
|
|
|
|||||||||
Net Assets: |
||||||||||||
Beginning of year |
90,061,338 | 80,953,798 | ||||||||||
|
|
|
|
|||||||||
End of year |
$ | 100,802,712 | $ | 90,061,338 | ||||||||
|
|
|
|
|||||||||
Accumulated undistributed net investment income at end of year |
$ | 12,056 | $ | 67,241 | ||||||||
|
|
|
|
|||||||||
CAPITAL TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
$ | 768,454 | $ | 310,643 | ||||||||
Dividends reinvested |
| | ||||||||||
Cost of shares redeemed |
(385,966 | ) | (462,227 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
382,488 | (151,584 | ) | |||||||||
|
|
|
|
|||||||||
Class C Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
168,980 | 296,440 | ||||||||||
Dividends reinvested |
| | ||||||||||
Cost of shares redeemed |
(146,592 | ) | (62,169 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
22,388 | 234,271 | ||||||||||
|
|
|
|
|||||||||
Class M Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
6,941,409 | 6,074,346 | ||||||||||
Dividends reinvested |
186,718 | | ||||||||||
Cost of shares redeemed |
(16,278,607 | ) | (9,179,691 | ) | ||||||||
|
|
|
|
|||||||||
Total Class M Shares |
(9,150,480 | ) | (3,105,345 | ) | ||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 12)(a) |
||||||||||||
Proceeds from shares issued |
7,801 | 686,194 | ||||||||||
Dividends reinvested |
708 | | ||||||||||
Cost of shares redeemed |
(613,263 | ) | (2,180,888 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
(604,754 | ) | (1,494,694 | ) | ||||||||
|
|
|
|
|||||||||
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(b) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
47
Statements of Changes in Net Assets (Continued)
Nationwide Bailard Technology & Science Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
CAPITAL TRANSACTIONS: (continued) |
||||||||||||
Institutional Class Shares |
||||||||||||
Proceeds from shares issued |
$ | 105,496 | (b) | $ | | |||||||
Dividends reinvested |
22 | (b) | | |||||||||
Cost of shares redeemed |
(30,252 | )(b) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
75,266 | (b) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
$ | (9,275,092 | ) | $ | (4,517,352 | ) | ||||||
|
|
|
|
|||||||||
SHARE TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Issued |
50,026 | 25,493 | ||||||||||
Reinvested |
| | ||||||||||
Redeemed |
(25,336 | ) | (38,465 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
24,690 | (12,972 | ) | |||||||||
|
|
|
|
|||||||||
Class C Shares (Note 12) |
||||||||||||
Issued |
11,334 | 24,443 | ||||||||||
Reinvested |
| | ||||||||||
Redeemed |
(9,302 | ) | (5,480 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
2,032 | 18,963 | ||||||||||
|
|
|
|
|||||||||
Class M Shares (Note 12) |
||||||||||||
Issued |
446,897 | 473,576 | ||||||||||
Reinvested |
12,236 | | ||||||||||
Redeemed |
(1,010,879 | ) | (709,516 | ) | ||||||||
|
|
|
|
|||||||||
Total Class M Shares |
(551,746 | ) | (235,940 | ) | ||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 12)(a) |
||||||||||||
Issued |
551 | 54,441 | ||||||||||
Reinvested |
46 | | ||||||||||
Redeemed |
(41,111 | ) | (177,027 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
(40,514 | ) | (122,586 | ) | ||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Issued |
6,260 | (b) | | |||||||||
Reinvested |
2 | (b) | | |||||||||
Redeemed |
(1,737 | )(b) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
4,525 | (b) | | |||||||||
|
|
|
|
|||||||||
Total change in shares |
(561,013 | ) | (352,535 | ) | ||||||||
|
|
|
|
|||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(b) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
48
Financial Highlights
Selected data for each share of capital outstanding throughout the periods indicated
Nationwide Bailard Technology & Science Fund
Operations | Distributions | Ratios/Supplemental Data |
||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period |
Net (Loss) |
Net Realized from |
Total from Operations |
Net Investment Income |
Total Distributions |
Net Asset Value, End of Period |
Total Return (a)(b)(c) |
Net Assets at End of Period |
Ratio of Expenses to Average Net Assets (d) |
Ratio of Net (Loss) |
Ratio of Expenses (Prior to Reimbursements) to Average Net Assets (d)(e) |
Portfolio Turnover (f) |
||||||||||||||||||||||||||||||||||||||||
Class A Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 13.51 | (0.03 | ) | 3.05 | 3.02 | | | $ | 16.53 | 22.35% | $ | 2,192,132 | 1.37% | (0.23% | ) | 1.39% | 36.99% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 11.56 | (0.02 | ) | 1.97 | 1.95 | | | $ | 13.51 | 16.87% | $ | 1,458,286 | 1.45% | (0.13% | ) | 1.58% | 45.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 10.98 | (0.06 | ) | 0.64 | 0.58 | | | $ | 11.56 | 5.28% | $ | 1,397,618 | 1.45% | (0.57% | ) | 1.60% | 11.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 9.05 | (0.06 | ) | 1.99 | 1.93 | | | $ | 10.98 | 21.33% | $ | 1,973,765 | 1.45% | (0.61% | ) | 1.58% | 16.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 7.96 | (0.04 | ) | 1.13 | 1.09 | | | $ | 9.05 | 13.71% | $ | 2,277,231 | 1.43% | (0.46% | ) | 1.58% | 17.00% | ||||||||||||||||||||||||||||||||||
Class C Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 12.95 | (0.13 | ) | 2.92 | 2.79 | | | $ | 15.74 | 21.54% | $ | 498,395 | 2.05% | (0.90% | ) | 2.05% | 36.99% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 11.15 | (0.09 | ) | 1.89 | 1.80 | | | $ | 12.95 | 16.14% | $ | 383,795 | 2.05% | (0.73% | ) | 2.08% | 45.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 10.66 | (0.12 | ) | 0.61 | 0.49 | | | $ | 11.15 | 4.60% | $ | 118,946 | 2.05% | (1.17% | ) | 2.10% | 11.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 8.84 | (0.13 | ) | 1.95 | 1.82 | | | $ | 10.66 | 20.59% | $ | 271,742 | 2.05% | (1.21% | ) | 2.08% | 16.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 7.82 | (0.09 | ) | 1.11 | 1.02 | | | $ | 8.84 | 13.04% | $ | 179,645 | 2.03% | (1.06% | ) | 2.08% | 17.00% | ||||||||||||||||||||||||||||||||||
Class M Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 13.90 | 0.03 | 3.14 | 3.17 | (0.03 | ) | (0.03 | ) | $ | 17.04 | 22.85% | $ | 96,832,238 | 0.99% | 0.18% | 0.99% | 36.99% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 11.85 | 0.03 | 2.02 | 2.05 | | | $ | 13.90 | 17.30% | $ | 86,675,286 | 1.05% | 0.27% | 1.08% | 45.00% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 11.21 | (0.02 | ) | 0.66 | 0.64 | | | $ | 11.85 | 5.71% | $ | 76,669,709 | 1.05% | (0.17% | ) | 1.10% | 11.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 9.20 | (0.02 | ) | 2.03 | 2.01 | | | $ | 11.21 | 21.85% | $ | 86,181,523 | 1.05% | (0.21% | ) | 1.08% | 16.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 8.07 | (0.01 | ) | 1.15 | 1.14 | (0.01 | ) | (0.01 | ) | $ | 9.20 | 14.04% | $ | 64,408,363 | 1.03% | (0.06% | ) | 1.08% | 17.00% | ||||||||||||||||||||||||||||||||
Institutional Service Class Shares (h) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 13.87 | | 3.14 | 3.14 | (0.01 | ) | (0.01 | ) | $ | 17.00 | 22.63% | $ | 1,203,010 | 1.17% | 0.01% | 1.20% | 36.99% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 11.83 | 0.02 | 2.02 | 2.04 | | | $ | 13.87 | 17.24% | $ | 1,543,971 | 1.14% | 0.18% | 1.33% | 45.00% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 11.20 | (0.03 | ) | 0.66 | 0.63 | | | $ | 11.83 | 5.63% | $ | 2,767,525 | 1.11% | (0.23% | ) | 1.35% | 11.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 9.20 | (0.03 | ) | 2.03 | 2.00 | | | $ | 11.20 | 21.74% | $ | 1,980,407 | 1.09% | (0.25% | ) | 1.33% | 16.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 8.07 | (0.01 | ) | 1.15 | 1.14 | (0.01 | ) | (0.01 | ) | $ | 9.20 | 14.17% | $ | 1,676,367 | 1.06% | (0.09% | ) | 1.33% | 17.00% | ||||||||||||||||||||||||||||||||
Institutional Class Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Period Ended July 31, 2014 (g)(i) |
$ | 14.53 | (0.02 | ) | 2.52 | 2.50 | (0.03 | ) | (0.03 | ) | $ | 17.00 | 17.25% | $ | 76,937 | 0.96% | (0.14% | ) | 0.96% | 36.99% | ||||||||||||||||||||||||||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Excludes sales charge. |
(b) | Not annualized for periods less than one year. |
(c) | Total returns prior to the Funds inception on September 16, 2013 are based on the performance of the Funds predecessor fund. |
(d) | Annualized for periods less than one year. |
(e) | During the period, certain fees may have been waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(f) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(g) | Per share calculations were performed using average shares method. |
(h) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(i) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. Total return is calculated based on inception date of September 18, 2013 through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
49
Fund Commentary | Nationwide Geneva Mid Cap Growth Fund |
50
Fund Commentary (cont.) | Nationwide Geneva Mid Cap Growth Fund |
51
Fund Overview | Nationwide Geneva Mid Cap Growth Fund |
| Percentages indicated are based upon net assets as of July 31, 2014. |
| Amount rounds to less than 0.1%. |
| Percentages indicated are based upon total investments as of July 31, 2014. |
* | For purposes of listing top industries and top holdings, the repurchase agreement is included as part of Other. |
52
Fund Performance | Nationwide Geneva Mid Cap Growth Fund |
53
Fund Performance (cont.) | Nationwide Geneva Mid Cap Growth Fund |
Performance of a $10,000 Investment
Investment return and principal value will fluctuate, and when redeemed, shares may be worth more or less than original cost. Past performance is no guarantee of future results and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Investing in mutual funds involves market risk, including loss of principal. Performance returns assume the reinvestment of all distributions.
Comparative performance of $10,000 invested in Class A shares of the Nationwide Geneva Mid Cap Growth Fund versus the Russell Midcap® Growth Index and the Consumer Price Index (CPI) over the 10-year period ended 7/31/14. Fund performance prior to the Funds inception on 9/16/13 is based on the Funds predecessor fund. Unlike the Fund, the performance for these unmanaged indexes does not reflect any fees, expenses, or sales charges. One cannot invest directly in a market index. A description of the benchmarks can be found on the Market Index Definitions page at the back of this book.
54
Shareholder Expense Example | Nationwide Geneva Mid Cap Growth Fund |
Schedule of Shareholder Expenses
Expense Analysis of a $1,000 Investment
Nationwide Geneva Mid Cap July 31, 2014 |
Beginning Account Value ($) 02/01/14 |
Ending Account Value ($) 07/31/14 |
Expenses Paid During Period ($) 02/01/14 - 07/31/14 |
Expense Ratio During Period (%) 02/01/14 - 07/31/14 | ||||||||
Class A Shares | Actual | (a) | 1,000.00 | 1,002.10 | 5.76 | 1.16 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,019.04 | 5.81 | 1.16 | |||||||
Class C Shares | Actual | (a) | 1,000.00 | 998.40 | 9.27 | 1.87 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,015.52 | 9.35 | 1.87 | |||||||
Institutional Service Class Shares(c) | Actual | (a) | 1,000.00 | 1,003.10 | 4.32 | 0.87 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,020.48 | 4.36 | 0.87 | |||||||
Institutional Class Shares | Actual | (a) | 1,000.00 | 1,003.50 | 3.97 | 0.80 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,020.83 | 4.01 | 0.80 |
(a) | Expenses are equal to the Funds annualized expense ratio multiplied by the average account value from February 1, 2014 through July 31, 2014 multiplied to reflect one-half year period. The expense ratio presented represents a six-month, annualized ratio in accordance with Securities and Exchange Commission guidelines. |
(b) | Represents the hypothetical 5% return before expenses. |
(c) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
55
Statement of Investments
July 31, 2014
Nationwide Geneva Mid Cap Growth Fund
56
Statement of Investments (Continued)
July 31, 2014
Nationwide Geneva Mid Cap Growth Fund (Continued)
The accompanying notes are an integral part of these financial statements.
57
Statement of Assets and Liabilities
July 31, 2014
Nationwide Geneva Mid Cap Growth Fund | ||||||
Assets: |
||||||
Investments, at value* (cost $1,174,106,457) |
$ | 1,454,954,675 | ||||
Repurchase agreement, at value (cost $5,171,271) |
5,171,271 | |||||
|
|
|||||
Total Investments, at value (total cost $1,179,277,728) |
1,460,125,946 | |||||
|
|
|||||
Cash |
49,283,864 | |||||
Dividends receivable |
394,102 | |||||
Security lending income receivable |
452 | |||||
Receivable for capital shares issued |
2,572,358 | |||||
Prepaid expenses |
32,230 | |||||
|
|
|||||
Total Assets |
1,512,408,952 | |||||
|
|
|||||
Liabilities: |
||||||
Payable for capital shares redeemed |
2,100,252 | |||||
Payable upon return of securities loaned (Note 2) |
5,731,250 | |||||
Accrued expenses and other payables: |
||||||
Investment advisory fees |
881,160 | |||||
Fund administration fees |
65,357 | |||||
Distribution fees |
186,440 | |||||
Administrative servicing fees |
505,843 | |||||
Accounting and transfer agent fees |
100,224 | |||||
Trustee fees |
3,958 | |||||
Custodian fees |
6,850 | |||||
Compliance program costs (Note 3) |
285 | |||||
Professional fees |
35,415 | |||||
Printing fees |
137,633 | |||||
Other |
6,218 | |||||
|
|
|||||
Total Liabilities |
9,760,885 | |||||
|
|
|||||
Net Assets |
$ | 1,502,648,067 | ||||
|
|
|||||
Represented by: |
||||||
Capital |
$ | 1,120,586,955 | ||||
Accumulated distributions in excess of net investment loss |
(5,426,589 | ) | ||||
Accumulated net realized gains from investments |
106,639,483 | |||||
Net unrealized appreciation/(depreciation) from investments |
280,848,218 | |||||
|
|
|||||
Net Assets |
$ | 1,502,648,067 | ||||
|
|
|||||
Net Assets: |
||||||
Class A Shares |
$ | 476,141,617 | ||||
Class C Shares |
95,287,969 | |||||
Institutional Service Class Shares |
919,189,168 | |||||
Institutional Class Shares |
12,029,313 | |||||
|
|
|||||
Total |
$ | 1,502,648,067 | ||||
|
|
|||||
Shares Outstanding (unlimited number of shares authorized): |
||||||
Class A Shares |
16,709,405 | |||||
Class C Shares |
3,724,240 | |||||
Institutional Service Class Shares |
31,782,503 | |||||
Institutional Class Shares |
415,317 | |||||
|
|
|||||
Total |
52,631,465 | |||||
|
|
|||||
* | Includes value of securities on loan of $5,617,500 (Note 2). |
58
Statement of Assets and Liabilities (Continued)
July 31, 2014
Nationwide Geneva Mid Cap Growth Fund | ||||||
Net asset value and redemption price per share (Net assets by class divided by shares outstanding by class, respectively): |
||||||
Class A Shares (a) |
$ | 28.50 | ||||
Class C Shares (b) |
$ | 25.59 | ||||
Institutional Service Class Shares |
$ | 28.92 | ||||
Institutional Class Shares |
$ | 28.96 | ||||
Maximum offering price per share (100%/(100%-maximum sales charge) of net asset value adjusted to the nearest cent): |
||||||
Class A Shares |
$ | 30.24 | ||||
|
|
|||||
Maximum Sales Charge: |
||||||
Class A Shares |
5.75 | % | ||||
|
|
|||||
(a) | For Class A Shares, the redemption price per share is reduced by 1.00% on sales of shares of original purchases of $1,000,000 or more or that were not subject to a front-end sales charge made within 18 months of the purchase date. |
(b) | For Class C Shares, the redemption price per share is reduced by 1.00% for shares held less than one year. |
The accompanying notes are an integral part of these financial statements.
59
Statement of Operations
For the Year Ended July 31, 2014
Nationwide Geneva Mid Cap Growth Fund | ||||||
INVESTMENT INCOME: |
||||||
Dividend income |
$ | 6,564,304 | ||||
Income from securities lending (Note 2) |
2,736 | |||||
|
|
|||||
Total Income |
6,567,040 | |||||
|
|
|||||
EXPENSES: |
||||||
Investment advisory fees |
10,140,564 | |||||
Fund administration fees |
1,021,181 | |||||
Distribution fees Class A |
1,230,450 | |||||
Distribution fees Class B (a) |
2,013 | |||||
Distribution fees Class C |
999,838 | |||||
Administrative servicing fees Class A |
863,943 | |||||
Administrative servicing fees Class B (a) |
671 | |||||
Administrative servicing fees Class C |
27,078 | |||||
Administrative servicing fees Institutional Service Class (b) |
1,376,857 | |||||
Registration and filing fees |
107,469 | |||||
Professional fees |
114,226 | |||||
Printing fees |
442,042 | |||||
Trustee fees |
55,828 | |||||
Custodian fees |
57,414 | |||||
Accounting and transfer agent fees |
512,332 | |||||
Compliance program costs (Note 3) |
5,572 | |||||
Recoupment fees (Note 3) |
45,468 | |||||
Other |
76,682 | |||||
|
|
|||||
Total expenses before earnings credit and fees waived |
17,079,628 | |||||
|
|
|||||
Earnings credit (Note 5) |
(428 | ) | ||||
Administrative servicing fees voluntarily waived Class A (Note 3) |
(60,206 | ) | ||||
Administrative servicing fees voluntarily waived Institutional Service Class (Note 3) (b) |
(104,251 | ) | ||||
|
|
|||||
Net Expenses |
16,914,743 | |||||
|
|
|||||
NET INVESTMENT LOSS |
(10,347,703 | ) | ||||
|
|
|||||
REALIZED/UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: |
||||||
Net realized gains from investment transactions |
108,159,253 | |||||
Net change in unrealized appreciation/(depreciation) from investments |
2,946,762 | |||||
|
|
|||||
Net realized/unrealized gains from investments |
111,106,015 | |||||
|
|
|||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS |
$ | 100,758,312 | ||||
|
|
|||||
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
The accompanying notes are an integral part of these financial statements.
60
Statements of Changes in Net Assets
Nationwide Geneva Mid Cap Growth Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
Operations: |
||||||||||||
Net investment loss |
$ | (10,347,703 | ) | $ | (7,898,601 | ) | ||||||
Net realized gains from investments |
108,159,253 | 88,815,733 | ||||||||||
Net change in unrealized appreciation/(depreciation) from investments |
2,946,762 | 157,419,685 | ||||||||||
|
|
|
|
|||||||||
Change in net assets resulting from operations |
100,758,312 | 238,336,817 | ||||||||||
|
|
|
|
|||||||||
Distributions to Shareholders From: |
||||||||||||
Net realized gains: |
||||||||||||
Class A |
(25,361,042 | ) | (6,861,984 | ) | ||||||||
Class B (a) |
| (54,588 | ) | |||||||||
Class C |
(5,688,359 | ) | (1,519,946 | ) | ||||||||
Institutional Service Class (b) |
(46,021,008 | ) | (9,977,376 | ) | ||||||||
Institutional Class |
(515 | )(c) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from shareholder distributions |
(77,070,924 | ) | (18,413,894 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
86,503,149 | 323,508,195 | ||||||||||
|
|
|
|
|||||||||
Change in net assets |
110,190,537 | 543,431,118 | ||||||||||
|
|
|
|
|||||||||
Net Assets: |
||||||||||||
Beginning of year |
1,392,457,530 | 849,026,412 | ||||||||||
|
|
|
|
|||||||||
End of year |
$ | 1,502,648,067 | $ | 1,392,457,530 | ||||||||
|
|
|
|
|||||||||
Accumulated distributions in excess of net investment income at end of year |
$ | (5,426,589 | ) | $ | (7,898,600 | ) | ||||||
|
|
|
|
|||||||||
CAPITAL TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
$ | 104,894,746 | $ | 148,745,590 | ||||||||
Proceeds from shares issued from class conversion |
2,015,421 | | ||||||||||
Dividends reinvested |
24,126,492 | 6,402,395 | ||||||||||
Cost of shares redeemed |
(138,009,148 | ) | (104,626,362 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
(6,972,489 | ) | 50,521,623 | |||||||||
|
|
|
|
|||||||||
Class B Shares (Note 12)(a) |
||||||||||||
Proceeds from shares issued |
1,748 | 3,668 | ||||||||||
Dividends reinvested |
| 51,653 | ||||||||||
Cost of shares redeemed in class conversion |
(2,015,421 | ) | | |||||||||
Cost of shares redeemed |
(311,700 | ) | (1,841,076 | ) | ||||||||
|
|
|
|
|||||||||
Total Class B Shares |
(2,325,373 | ) | (1,785,755 | ) | ||||||||
|
|
|
|
|||||||||
Class C Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
14,028,000 | 23,731,707 | ||||||||||
Dividends reinvested |
5,132,718 | 1,296,710 | ||||||||||
Cost of shares redeemed |
(21,009,450 | ) | (10,901,080 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
(1,848,732 | ) | 14,127,337 | |||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 12)(b) |
||||||||||||
Proceeds from shares issued |
316,755,456 | 407,746,116 | ||||||||||
Dividends reinvested |
37,689,226 | 8,126,513 | ||||||||||
Cost of shares redeemed |
(268,631,619 | ) | (155,227,639 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
85,813,063 | 260,644,990 | ||||||||||
|
|
|
|
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(c) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
61
Statements of Changes in Net Assets (Continued)
Nationwide Geneva Mid Cap Growth Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
CAPITAL TRANSACTIONS: (continued) |
||||||||||||
Institutional Class Shares |
||||||||||||
Proceeds from shares issued |
$ | 11,932,537 | (c) | $ | | |||||||
Dividends reinvested |
515 | (c) | | |||||||||
Cost of shares redeemed |
(96,372 | )(c) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
11,836,680 | (c) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
$ | 86,503,149 | $ | 323,508,195 | ||||||||
|
|
|
|
|||||||||
SHARE TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Issued |
3,623,353 | 5,904,464 | ||||||||||
Issued in class conversion |
69,832 | | ||||||||||
Reinvested |
855,229 | 268,670 | ||||||||||
Redeemed |
(4,767,055 | ) | (4,136,914 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
(218,641 | ) | 2,036,220 | |||||||||
|
|
|
|
|||||||||
Class B Shares (Note 12)(a) |
||||||||||||
Issued |
70 | 165 | ||||||||||
Reinvested |
| 2,407 | ||||||||||
Redeemed in class conversion |
(77,898 | ) | | |||||||||
Redeemed |
(12,147 | ) | (81,834 | ) | ||||||||
|
|
|
|
|||||||||
Total Class B Shares |
(89,975 | ) | (79,262 | ) | ||||||||
|
|
|
|
|||||||||
Class C Shares (Note 12) |
||||||||||||
Issued |
536,623 | 1,042,254 | ||||||||||
Reinvested |
201,837 | 59,674 | ||||||||||
Redeemed |
(804,161 | ) | (470,443 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
(65,701 | ) | 631,485 | |||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 12)(b) |
||||||||||||
Issued |
10,856,454 | 16,112,704 | ||||||||||
Reinvested |
1,318,728 | 337,620 | ||||||||||
Redeemed |
(9,188,510 | ) | (6,065,193 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
2,986,672 | 10,385,131 | ||||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Issued |
418,599 | (c) | | |||||||||
Reinvested |
18 | (c) | | |||||||||
Redeemed |
(3,300 | )(c) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
415,317 | (c) | | |||||||||
|
|
|
|
|||||||||
Total change in shares |
3,027,672 | 12,973,574 | ||||||||||
|
|
|
|
|||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(c) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
62
Financial Highlights
Selected data for each share of capital outstanding throughout the periods indicated
Nationwide Geneva Mid Cap Growth Fund
Operations | Distributions | Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period |
Net Investment Loss |
Net
Realized and Unrealized Gains (Losses) from Investments |
Total from Operations |
Net Realized Gains |
Total Distributions |
Net Asset Value, End of Period |
Total Return (a)(b)(c) |
Net Assets at End of Period |
Ratio of Expenses to Average Net Assets (d) |
Ratio of
Net Investment Loss to Average Net Assets (d) |
Ratio of Expenses (Prior to Reimbursements) to Average Net Assets (d)(e) |
Portfolio Turnover (f) |
||||||||||||||||||||||||||||||||||||||||
Class A Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 28.09 | (0.24 | ) | 2.18 | 1.94 | (1.53 | ) | (1.53 | ) | $ | 28.50 | 6.96% | $ | 476,141,617 | 1.25% | (0.81% | ) | 1.26% | 32.13% | ||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 23.26 | (0.20 | ) | 5.46 | 5.26 | (0.43 | ) | (0.43 | ) | $ | 28.09 | 22.96% | $ | 475,430,830 | 1.38% | (0.79% | ) | 1.45% | 26.00% | ||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 22.71 | (0.20 | ) | 1.20 | 1.00 | (0.45 | ) | (0.45 | ) | $ | 23.26 | 4.46% | $ | 346,311,494 | 1.38% | (0.88% | ) | 1.51% | 17.00% | ||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 17.92 | (0.20 | ) | 5.02 | 4.82 | (0.03 | ) | (0.03 | ) | $ | 22.71 | 26.82% | $ | 195,872,031 | 1.38% | (0.92% | ) | 1.54% | 23.00% | ||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 15.03 | (0.15 | ) | 3.04 | 2.89 | | | $ | 17.92 | 19.22% | $ | 176,923,831 | 1.38% | (0.90% | ) | 1.57% | 26.00% | ||||||||||||||||||||||||||||||||||
Class C Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 25.52 | (0.37 | ) | 1.97 | 1.60 | (1.53 | ) | (1.53 | ) | $ | 25.59 | 6.30% | $ | 95,287,969 | 1.87% | (1.43% | ) | 1.87% | 32.13% | ||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 21.29 | (0.32 | ) | 4.98 | 4.66 | (0.43 | ) | (0.43 | ) | $ | 25.52 | 22.26% | $ | 96,702,988 | 1.98% | (1.39% | ) | 1.95% | 26.00% | ||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 20.96 | (0.32 | ) | 1.10 | 0.78 | (0.45 | ) | (0.45 | ) | $ | 21.29 | 3.77% | $ | 67,244,463 | 1.98% | (1.48% | ) | 2.01% | 17.00% | ||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 16.64 | (0.31 | ) | 4.66 | 4.35 | (0.03 | ) | (0.03 | ) | $ | 20.96 | 26.14% | $ | 32,580,381 | 1.98% | (1.52% | ) | 2.04% | 23.00% | ||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 14.04 | (0.24 | ) | 2.84 | 2.60 | | | $ | 16.64 | 18.52% | $ | 18,896,175 | 1.98% | (1.50% | ) | 2.07% | 26.00% | ||||||||||||||||||||||||||||||||||
Institutional Service Class Shares (h) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 28.41 | (0.16 | ) | 2.20 | 2.04 | (1.53 | ) | (1.53 | ) | $ | 28.92 | 7.24% | $ | 919,189,168 | 0.98% | (0.54% | ) | 0.99% | 32.13% | ||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 23.46 | (0.14 | ) | 5.52 | 5.38 | (0.43 | ) | (0.43 | ) | $ | 28.41 | 23.28% | $ | 818,056,645 | 1.13% | (0.54% | ) | 1.02% | 26.00% | ||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 22.85 | (0.15 | ) | 1.21 | 1.06 | (0.45 | ) | (0.45 | ) | $ | 23.46 | 4.70% | $ | 431,911,298 | 1.13% | (0.63% | ) | 1.26% | 17.00% | ||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 17.98 | (0.15 | ) | 5.05 | 4.90 | (0.03 | ) | (0.03 | ) | $ | 22.85 | 27.25% | $ | 215,698,880 | 1.13% | (0.67% | ) | 1.29% | 23.00% | ||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 15.04 | (0.11 | ) | 3.05 | 2.94 | | | $ | 17.98 | 19.55% | $ | 19,588,342 | 1.11% | (0.63% | ) | 1.32% | 26.00% | ||||||||||||||||||||||||||||||||||
Institutional Class Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Period Ended July 31, 2014 (g)(i) |
$ | 29.70 | (0.08 | ) | 0.87 | 0.79 | (1.53 | ) | (1.53 | ) | $ | 28.96 | 2.72% | $ | 12,029,313 | 0.80% | (0.31% | ) | 0.80% | 32.13% | ||||||||||||||||||||||||||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Excludes sales charge. |
(b) | Not annualized for periods less than one year. |
(c) | Total returns prior to the Funds inception on September 16, 2013 are based on the performance of the Funds predecessor fund. |
(d) | Annualized for periods less than one year. |
(e) | During the period, certain fees may have been waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(f) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(g) | Per share calculations were performed using average shares method. |
(h) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(i) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. Total return is calculated based on inception date of September 18, 2013 through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
63
Fund Commentary | Nationwide Geneva Small Cap Growth Fund |
64
Fund Commentary (cont.) | Nationwide Geneva Small Cap Growth Fund |
65
Fund Overview | Nationwide Geneva Small Cap Growth Fund |
| Percentages indicated are based upon net assets as of July 31, 2014. |
| Percentages indicated are based upon total investments as of July 31, 2014. |
66
Fund Performance | Nationwide Geneva Small Cap Growth Fund |
67
Fund Performance (cont.) | Nationwide Geneva Small Cap Growth Fund |
Performance of a $10,000 Investment
Investment return and principal value will fluctuate, and when redeemed, shares may be worth more or less than original cost. Past performance is no guarantee of future results and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Investing in mutual funds involves market risk, including loss of principal. Performance returns assume the reinvestment of all distributions.
Comparative performance of $10,000 invested in Institutional Service Class shares of the Nationwide Geneva Small Cap Growth Fund since inception* through 7/31/14 versus the Russell 2000® Growth Index and the Consumer Price Index (CPI) for the same period. Unlike the Fund, the performance for these unmanaged indexes does not reflect any fees, expenses, or sales charges. One cannot invest directly in a market index. A description of the benchmarks can be found on the Market Index Definitions page at the back of this book.
*The inception date for the Nationwide Geneva Small Cap Growth Fund is 9/16/13. Performance prior to that date is based on the since-inception performance of the Funds predecessor fund.
68
Shareholder Expense Example | Nationwide Geneva Small Cap Growth Fund |
Schedule of Shareholder Expenses
Expense Analysis of a $1,000 Investment
Nationwide Geneva Small Cap July 31, 2014 |
Beginning Account Value ($) 02/01/14 |
Ending Account Value ($) 07/31/14 |
Expenses Paid During Period ($) 02/01/14 - 07/31/14 |
Expense Ratio During Period (%) 02/01/14 - 07/31/14 | ||||||||
Class A Shares | Actual | (a) | 1,000.00 | 913.70 | 7.40 | 1.56 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,017.06 | 7.80 | 1.56 | ||||||||
Class C Shares | Actual | (a) | 1,000.00 | 910.60 | 10.52 | 2.22 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,013.79 | 11.08 | 2.22 | ||||||||
Institutional Service Class Shares(c) | Actual | (a) | 1,000.00 | 915.00 | 5.89 | 1.24 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,018.65 | 6.21 | 1.24 | ||||||||
Institutional Class Shares | Actual | (a) | 1,000.00 | 915.30 | 5.60 | 1.18 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,018.94 | 5.91 | 1.18 |
(a) | Expenses are equal to the Funds annualized expense ratio multiplied by the average account value from February 1, 2014 through July 31, 2014 multiplied to reflect one-half year period. The expense ratio presented represents a six-month, annualized ratio in accordance with Securities and Exchange Commission guidelines. |
(b) | Represents the hypothetical 5% return before expenses. |
(c) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
69
Statement of Investments
July 31, 2014
Nationwide Geneva Small Cap Growth Fund
70
Statement of Investments (Continued)
July 31, 2014
Nationwide Geneva Small Cap Growth Fund (Continued)
The accompanying notes are an integral part of these financial statements.
71
Statement of Assets and Liabilities
July 31, 2014
Nationwide Geneva Small Cap Growth Fund | ||||||
Assets: |
||||||
Investments, at value (cost $122,074,953) |
$ | 137,586,792 | ||||
Cash |
1,047,031 | |||||
Dividends receivable |
3,926 | |||||
Receivable for investments sold |
2,262,968 | |||||
Receivable for capital shares issued |
1,371,711 | |||||
Prepaid expenses |
19,177 | |||||
|
|
|||||
Total Assets |
142,291,605 | |||||
|
|
|||||
Liabilities: |
||||||
Payable for investments purchased |
361,576 | |||||
Payable for capital shares redeemed |
497,939 | |||||
Accrued expenses and other payables: |
||||||
Investment advisory fees |
124,077 | |||||
Fund administration fees |
10,613 | |||||
Distribution fees |
20,477 | |||||
Administrative servicing fees |
21,225 | |||||
Accounting and transfer agent fees |
3,014 | |||||
Trustee fees |
358 | |||||
Custodian fees |
590 | |||||
Compliance program costs (Note 3) |
179 | |||||
Professional fees |
22,231 | |||||
Printing fees |
11,129 | |||||
Other |
3,644 | |||||
|
|
|||||
Total Liabilities |
1,077,052 | |||||
|
|
|||||
Net Assets |
$ | 141,214,553 | ||||
|
|
|||||
Represented by: |
||||||
Capital |
$ | 119,931,050 | ||||
Accumulated distributions in excess of net investment loss |
(911,073 | ) | ||||
Accumulated net realized gains from investments |
6,682,737 | |||||
Net unrealized appreciation/(depreciation) from investments |
15,511,839 | |||||
|
|
|||||
Net Assets |
$ | 141,214,553 | ||||
|
|
|||||
Net Assets: |
||||||
Class A Shares |
$ | 27,931,521 | ||||
Class C Shares |
15,458,648 | |||||
Institutional Service Class Shares |
97,340,606 | |||||
Institutional Class Shares |
483,778 | |||||
|
|
|||||
Total |
$ | 141,214,553 | ||||
|
|
|||||
Shares Outstanding (unlimited number of shares authorized): |
||||||
Class A Shares |
699,752 | |||||
Class C Shares |
400,247 | |||||
Institutional Service Class Shares |
2,403,215 | |||||
Institutional Class Shares |
11,933 | |||||
|
|
|||||
Total |
3,515,147 | |||||
|
|
|||||
72
Statement of Assets and Liabilities (Continued)
July 31, 2014
Nationwide Geneva Small Cap Growth Fund | ||||||
Net asset value and redemption price per share (Net assets by class divided by shares outstanding by class, respectively): |
||||||
Class A Shares (a) |
$ | 39.92 | ||||
Class C Shares (b) |
$ | 38.62 | ||||
Institutional Service Class Shares |
$ | 40.50 | ||||
Institutional Class Shares |
$ | 40.54 | ||||
Maximum offering price per share (100%/(100%-maximum sales charge) of net asset value adjusted to the nearest cent): |
||||||
Class A Shares |
$ | 42.36 | ||||
|
|
|||||
Maximum Sales Charge: |
||||||
Class A Shares |
5.75 | % | ||||
|
|
|||||
(a) | For Class A Shares, the redemption price per share is reduced by 1.00% on sales of shares of original purchases of $1,000,000 or more or that were not subject to a front-end sales charge made within 18 months of the purchase date. |
(b) | For Class C Shares, the redemption price per share is reduced by 1.00% for shares held less than one year. |
The accompanying notes are an integral part of these financial statements.
73
Statement of Operations
For the Year Ended July 31, 2014
Nationwide Geneva Small Cap Growth Fund | ||||||
INVESTMENT INCOME: |
||||||
Dividend income |
$ | 612,173 | ||||
|
|
|||||
Total Income |
612,173 | |||||
|
|
|||||
EXPENSES: |
||||||
Investment advisory fees |
1,398,445 | |||||
Fund administration fees |
144,648 | |||||
Distribution fees Class A |
83,429 | |||||
Distribution fees Class C |
156,341 | |||||
Administrative servicing fees Class A |
44,984 | |||||
Administrative servicing fees Class C |
4,419 | |||||
Administrative servicing fees Institutional Service Class (a) |
88,730 | |||||
Registration and filing fees |
57,450 | |||||
Professional fees |
36,187 | |||||
Printing fees |
34,216 | |||||
Trustee fees |
4,076 | |||||
Custodian fees |
5,236 | |||||
Accounting and transfer agent fees |
22,507 | |||||
Compliance program costs (Note 3) |
1,768 | |||||
Other |
12,843 | |||||
|
|
|||||
Total expenses before earnings credit, fees waived, and expenses reimbursed |
2,095,279 | |||||
|
|
|||||
Earnings credit (Note 5) |
(66 | ) | ||||
Administrative servicing fees voluntarily waived Class A (Note 3) |
(3,108 | ) | ||||
Administrative servicing fees voluntarily waived Institutional Service Class (Note 3) (a) |
(9,476 | ) | ||||
Expenses reimbursed by adviser (Note 3) |
(23,530 | ) | ||||
|
|
|||||
Net Expenses |
2,059,099 | |||||
|
|
|||||
NET INVESTMENT LOSS |
(1,446,926 | ) | ||||
|
|
|||||
REALIZED/UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: |
||||||
Net realized gains from investment transactions |
8,299,863 | |||||
Net change in unrealized appreciation/(depreciation) from investments |
(6,908,932 | ) | ||||
|
|
|||||
Net realized/unrealized gains from investments |
1,390,931 | |||||
|
|
|||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS |
$ | (55,995 | ) | |||
|
|
|||||
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
The accompanying notes are an integral part of these financial statements.
74
Statements of Changes in Net Assets
Nationwide Geneva Small Cap Growth Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
Operations: |
||||||||||||
Net investment loss |
$ | (1,446,926 | ) | $ | (764,763 | ) | ||||||
Net realized gains from investments |
8,299,863 | 4,210,112 | ||||||||||
Net change in unrealized appreciation/(depreciation) from investments |
(6,908,932 | ) | 18,438,559 | |||||||||
|
|
|
|
|||||||||
Change in net assets resulting from operations |
(55,995 | ) | 21,883,908 | |||||||||
|
|
|
|
|||||||||
Distributions to Shareholders From: |
||||||||||||
Net realized gains: |
||||||||||||
Class A |
(1,065,380 | ) | (583,961 | ) | ||||||||
Class C |
(502,214 | ) | (285,618 | ) | ||||||||
Institutional Service Class (a) |
(2,586,446 | ) | (1,574,763 | ) | ||||||||
Institutional Class |
(325 | )(b) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from shareholder distributions |
(4,154,365 | ) | (2,444,342 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
35,748,830 | 51,141,945 | ||||||||||
|
|
|
|
|||||||||
Change in net assets |
31,538,470 | 70,581,511 | ||||||||||
|
|
|
|
|||||||||
Net Assets: |
||||||||||||
Beginning of year |
109,676,083 | 39,094,572 | ||||||||||
|
|
|
|
|||||||||
End of year |
$ | 141,214,553 | $ | 109,676,083 | ||||||||
|
|
|
|
|||||||||
Accumulated distributions in excess of net investment income at end of year |
$ | (911,073 | ) | $ | (764,763 | ) | ||||||
|
|
|
|
|||||||||
CAPITAL TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
$ | 25,755,368 | $ | 15,711,087 | (c) | |||||||
Dividends reinvested |
1,038,753 | 552,963 | ||||||||||
Cost of shares redeemed |
(22,224,052 | ) | (6,057,104 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
4,570,069 | 10,206,946 | ||||||||||
|
|
|
|
|||||||||
Class C Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
6,693,233 | 6,971,615 | (c) | |||||||||
Dividends reinvested |
493,337 | 281,159 | ||||||||||
Cost of shares redeemed |
(3,128,668 | ) | (1,075,169 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
4,057,902 | 6,177,605 | ||||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 12)(a) |
||||||||||||
Proceeds from shares issued |
68,410,493 | 47,263,193 | (c) | |||||||||
Dividends reinvested |
2,109,678 | 1,100,299 | ||||||||||
Cost of shares redeemed |
(43,907,701 | ) | (13,606,098 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
26,612,470 | 34,757,394 | ||||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Proceeds from shares issued |
517,828 | (b) | | |||||||||
Dividends reinvested |
325 | (b) | | |||||||||
Cost of shares redeemed |
(9,764 | )(b) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
508,389 | (b) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
$ | 35,748,830 | $ | 51,141,945 | ||||||||
|
|
|
|
|||||||||
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(b) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
(c) | Includes redemption fees. See Note 4 for further information. |
75
Statements of Changes in Net Assets (Continued)
Nationwide Geneva Small Cap Growth Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
SHARE TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Issued |
595,988 | 457,436 | ||||||||||
Reinvested |
24,367 | 17,383 | ||||||||||
Redeemed |
(535,546 | ) | (176,348 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
84,809 | 298,471 | ||||||||||
|
|
|
|
|||||||||
Class C Shares (Note 12) |
||||||||||||
Issued |
159,154 | 205,357 | ||||||||||
Reinvested |
11,911 | 9,035 | ||||||||||
Redeemed |
(77,239 | ) | (31,379 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
93,826 | 183,013 | ||||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 12)(a) |
||||||||||||
Issued |
1,592,850 | 1,350,672 | ||||||||||
Reinvested |
48,858 | 34,256 | ||||||||||
Redeemed |
(1,042,590 | ) | (383,045 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
599,118 | 1,001,883 | ||||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Issued |
12,169 | (b) | | |||||||||
Reinvested |
7 | (b) | | |||||||||
Redeemed |
(243 | )(b) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
11,933 | (b) | | |||||||||
|
|
|
|
|||||||||
Total change in shares |
789,686 | 1,483,367 | ||||||||||
|
|
|
|
|||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(b) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
(c) | Includes redemption fees. See Note 4 for further information. |
The accompanying notes are an integral part of these financial statements.
76
Financial Highlights
Selected data for each share of capital outstanding throughout the periods indicated
Nationwide Geneva Small Cap Growth Fund
Operations | Distributions | Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period |
Net Investment Loss |
Net
Realized and Unrealized Gains (Losses) from Investments |
Total from Operations |
Net Realized Gains |
Total Distributions |
Redemption Fees |
Net Asset Value, End of Period |
Total Return (a)(b)(c) |
Net Assets at End of Period |
Ratio of Expenses to Average Net Assets (d) |
Ratio of Net Investment Loss to Average Net Assets (d) |
Ratio of Expenses (Prior to Reimbursements) to Average Net Assets (d)(e) |
Portfolio Turnover (f) |
|||||||||||||||||||||||||||||||||||||||||||
Class A Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 40.05 | (0.49 | ) | 1.76 | 1.27 | (1.40 | ) | (1.40 | ) | | $ | 39.92 | 2.94% | $ | 27,931,521 | 1.59% | (1.15% | ) | 1.61% | 27.16% | |||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 31.36 | (0.42 | ) | 10.63 | 10.21 | (1.52 | ) | (1.52 | ) | | $ | 40.05 | 33.86% | $ | 24,629,215 | 1.62% | (1.21% | ) | 1.88% | 30.00% | |||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 30.87 | (0.38 | ) | 1.80 | 1.42 | (0.93 | ) | (0.93 | ) | | $ | 31.36 | 4.69% | $ | 9,925,067 | 1.62% | (1.26% | ) | 2.07% | 45.00% | |||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 24.39 | (0.39 | ) | 7.90 | 7.51 | (1.03 | ) | (1.03 | ) | | $ | 30.87 | 30.90% | $ | 9,000,251 | 1.62% | (1.30% | ) | 2.25% | 45.00% | |||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 20.70 | (0.26 | ) | 3.95 | 3.69 | | | | $ | 24.39 | 17.83% | $ | 3,220,168 | 1.62% | (1.15% | ) | 2.73% | 62.00% | |||||||||||||||||||||||||||||||||||||
Class C Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 39.04 | (0.73 | ) | 1.71 | 0.98 | (1.40 | ) | (1.40 | ) | | $ | 38.62 | 2.26% | $ | 15,458,648 | 2.22% | (1.78% | ) | 2.26% | 27.16% | |||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 30.78 | (0.62 | ) | 10.40 | 9.78 | (1.52 | ) | (1.52 | ) | | $ | 39.04 | 33.08% | $ | 11,961,250 | 2.22% | (1.81% | ) | 2.38% | 30.00% | |||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 30.49 | (0.56 | ) | 1.78 | 1.22 | (0.93 | ) | (0.93 | ) | | $ | 30.78 | 4.09% | $ | 3,798,576 | 2.22% | (1.86% | ) | 2.57% | 45.00% | |||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 24.23 | (0.58 | ) | 7.87 | 7.29 | (1.03 | ) | (1.03 | ) | | $ | 30.49 | 30.18% | $ | 2,133,507 | 2.22% | (1.90% | ) | 2.75% | 45.00% | |||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 20.69 | (0.40 | ) | 3.94 | 3.54 | | | | $ | 24.23 | 17.11% | $ | 259,851 | 2.22% | (1.75% | ) | 3.23% | 62.00% | |||||||||||||||||||||||||||||||||||||
Institutional Service Class Shares (h) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 40.51 | (0.37 | ) | 1.76 | 1.39 | (1.40 | ) | (1.40 | ) | | $ | 40.50 | 3.21% | $ | 97,340,606 | 1.30% | (0.86% | ) | 1.33% | 27.16% | |||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 31.63 | (0.34 | ) | 10.74 | 10.40 | (1.52 | ) | (1.52 | ) | | $ | 40.51 | 34.18% | $ | 73,085,618 | 1.36% | (0.95% | ) | 1.63% | 30.00% | |||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 31.04 | (0.30 | ) | 1.82 | 1.52 | (0.93 | ) | (0.93 | ) | | $ | 31.63 | 4.99% | $ | 25,370,929 | 1.35% | (0.99% | ) | 1.82% | 45.00% | |||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 24.45 | (0.31 | ) | 7.93 | 7.62 | (1.03 | ) | (1.03 | ) | | $ | 31.04 | 31.28% | $ | 12,477,289 | 1.35% | (1.03% | ) | 2.00% | 45.00% | |||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 20.70 | (0.20 | ) | 3.95 | 3.75 | | | | $ | 24.45 | 18.12% | $ | 6,252,291 | 1.37% | (0.89% | ) | 2.48% | 62.00% | |||||||||||||||||||||||||||||||||||||
Institutional Class Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Period Ended July 31, 2014 (g)(i) |
$ | 43.05 | (0.28 | ) | (0.83 | ) | (1.11 | ) | (1.40 | ) | (1.40 | ) | | $ | 40.54 | (2.79% | ) | $ | 483,778 | 1.18% | (0.77% | ) | 1.18% | 27.16% | ||||||||||||||||||||||||||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Excludes sales charge. |
(b) | Not annualized for periods less than one year. |
(c) | Total returns prior to the Funds inception on September 16, 2013 are based on the performance of the Funds predecessor fund. |
(d) | Annualized for periods less than one year. |
(e) | During the period, certain fees may have been waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(f) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(g) | Per share calculations were performed using average shares method. |
(h) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(i) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. Total return is calculated based on inception date of September 18, 2013 through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
77
Fund Commentary | Nationwide HighMark Balanced Fund |
78
Fund Commentary (cont.) | Nationwide HighMark Balanced Fund |
79
Fund Overview | Nationwide HighMark Balanced Fund |
| Percentages indicated are based upon net assets as of July 31, 2014. |
| Percentages indicated are based upon total investments as of July 31, 2014. |
80
Fund Performance | Nationwide HighMark Balanced Fund |
81
Fund Performance (cont.) | Nationwide HighMark Balanced Fund |
Performance of a $10,000 Investment
Investment return and principal value will fluctuate, and when redeemed, shares may be worth more or less than original cost. Past performance is no guarantee of future results and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Investing in mutual funds involves market risk, including loss of principal. Performance returns assume the reinvestment of all distributions.
Comparative performance of $10,000 invested in Institutional Service Class shares of the Nationwide HighMark Balanced Fund versus the Composite Index*, the S&P 500® Index, the Barclays U.S. Aggregate Bond Index and the Consumer Price Index (CPI) over the 10-year period ended 7/31/14. Fund performance prior to the Funds inception on 9/16/13 is based on the Funds predecessor fund. Unlike the Fund, the performance for these unmanaged indexes does not reflect any fees, expenses, or sales charges. One cannot invest directly in a market index. A description of the benchmarks can be found on the Market Index Definitions page at the back of this book.
*The Funds Composite Index comprises 60% S&P 500® Index and 40% Barclays U.S. Aggregate Bond Index.
82
Shareholder Expense Example | Nationwide HighMark Balanced Fund |
Schedule of Shareholder Expenses
Expense Analysis of a $1,000 Investment
Nationwide HighMark July 31, 2014 |
Beginning Account Value ($) 02/01/14 |
Ending Account Value ($) 07/31/14 |
Expenses Paid During Period ($) 02/01/14 - 07/31/14 |
Expense Ratio During Period (%) 02/01/14 - 07/31/14 | ||||||||
Class A Shares | Actual | (a) | 1,000.00 | 1,052.10 | 6.31 | 1.24 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,018.65 | 6.21 | 1.24 | |||||||
Class C Shares | Actual | (a) | 1,000.00 | 1,049.60 | 9.35 | 1.84 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,015.67 | 9.20 | 1.84 | |||||||
Institutional Service Class Shares(c) | Actual | (a) | 1,000.00 | 1,053.90 | 5.04 | 0.99 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,019.89 | 4.96 | 0.99 | |||||||
Institutional Class Shares | Actual | (a) | 1,000.00 | 1,054.20 | 4.28 | 0.84 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,020.63 | 4.21 | 0.84 |
(a) | Expenses are equal to the Funds annualized expense ratio multiplied by the average account value from February 1, 2014 through July 31, 2014 multiplied to reflect one-half year period. The expense ratio presented represents a six-month, annualized ratio in accordance with Securities and Exchange Commission guidelines. |
(b) | Represents the hypothetical 5% return before expenses. |
(c) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
83
Statement of Investments
July 31, 2014
Nationwide HighMark Balanced Fund
84
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Balanced Fund (Continued)
85
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Balanced Fund (Continued)
86
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Balanced Fund (Continued)
87
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Balanced Fund (Continued)
88
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Balanced Fund (Continued)
The accompanying notes are an integral part of these financial statements.
89
Statement of Assets and Liabilities
July 31, 2014
Nationwide Balanced Fund | ||||||
Assets: |
||||||
Investments, at value (cost $26,576,591) |
$ | 31,072,154 | ||||
Cash |
398,664 | |||||
Interest and dividends receivable |
93,787 | |||||
Receivable for capital shares issued |
25,878 | |||||
Prepaid expenses |
6,301 | |||||
|
|
|||||
Total Assets |
31,596,784 | |||||
|
|
|||||
Liabilities: |
||||||
Payable for capital shares redeemed |
82,898 | |||||
Accrued expenses and other payables: |
||||||
Investment advisory fees |
15,021 | |||||
Fund administration fees |
8,245 | |||||
Distribution fees |
7,131 | |||||
Administrative servicing fees |
7,165 | |||||
Accounting and transfer agent fees |
2,138 | |||||
Trustee fees |
69 | |||||
Custodian fees |
120 | |||||
Compliance program costs (Note 3) |
889 | |||||
Professional fees |
32,093 | |||||
Printing fees |
3,030 | |||||
Other |
3,439 | |||||
|
|
|||||
Total Liabilities |
162,238 | |||||
|
|
|||||
Net Assets |
$ | 31,434,546 | ||||
|
|
|||||
Represented by: |
||||||
Capital |
$ | 25,602,655 | ||||
Accumulated undistributed net investment income |
24,537 | |||||
Accumulated net realized gains from investments |
1,311,791 | |||||
Net unrealized appreciation/(depreciation) from investments |
4,495,563 | |||||
|
|
|||||
Net Assets |
$ | 31,434,546 | ||||
|
|
|||||
Net Assets: |
||||||
Class A Shares |
$ | 10,968,069 | ||||
Class C Shares |
5,544,829 | |||||
Institutional Service Class Shares |
14,859,466 | |||||
Institutional Class Shares |
62,182 | |||||
|
|
|||||
Total |
$ | 31,434,546 | ||||
|
|
|||||
Shares Outstanding (unlimited number of shares authorized): |
||||||
Class A Shares |
707,887 | |||||
Class C Shares |
360,510 | |||||
Institutional Service Class Shares |
956,540 | |||||
Institutional Class Shares |
3,995 | |||||
|
|
|||||
Total |
2,028,932 | |||||
|
|
|||||
90
Statement of Assets and Liabilities (Continued)
July 31, 2014
Nationwide Balanced Fund | ||||||
Net asset value and redemption price per share (Net assets by class divided by shares outstanding by class, respectively): |
||||||
Class A Shares (a) |
$ | 15.49 | ||||
Class C Shares (b) |
$ | 15.38 | ||||
Institutional Service Class Shares |
$ | 15.53 | ||||
Institutional Class Shares |
$ | 15.56 | ||||
Maximum offering price per share (100%/(100%-maximum sales charge) of net asset value adjusted to the nearest cent): |
||||||
Class A Shares |
$ | 16.44 | ||||
|
|
|||||
Maximum Sales Charge: |
||||||
Class A Shares |
5.75 | % | ||||
|
|
|||||
(a) | For Class A Shares, the redemption price per share is reduced by 1.00% on sales of shares of original purchases of $1,000,000 or more or that were not subject to a front-end sales charge made within 18 months of the purchase date. |
(b) | For Class C Shares, the redemption price per share is reduced by 1.00% for shares held less than one year. |
The accompanying notes are an integral part of these financial statements.
91
Statement of Operations
For the Year Ended July 31, 2014
Nationwide Balanced Fund | ||||||
INVESTMENT INCOME: |
||||||
Interest income |
$ | 346,282 | ||||
Dividend income |
284,427 | |||||
Foreign tax withholding |
(589 | ) | ||||
|
|
|||||
Total Income |
630,120 | |||||
|
|
|||||
EXPENSES: |
||||||
Investment advisory fees |
185,521 | |||||
Fund administration fees |
103,192 | |||||
Distribution fees Class A |
27,795 | |||||
Distribution fees Class B (a) |
15 | |||||
Distribution fees Class C |
52,093 | |||||
Administrative servicing fees Class A |
11,385 | |||||
Administrative servicing fees Class B (a) |
5 | |||||
Administrative servicing fees Class C |
939 | |||||
Administrative servicing fees Institutional Service Class (b) |
26,484 | |||||
Registration and filing fees |
53,250 | |||||
Professional fees |
42,447 | |||||
Printing fees |
11,239 | |||||
Trustee fees |
793 | |||||
Custodian fees |
1,216 | |||||
Accounting and transfer agent fees |
7,755 | |||||
Compliance program costs (Note 3) |
1,694 | |||||
Other |
14,304 | |||||
|
|
|||||
Total expenses before earnings credit, fees waived, and expenses reimbursed |
540,127 | |||||
|
|
|||||
Earnings credit (Note 5) |
(56 | ) | ||||
Administrative servicing fees voluntarily waived Class A (Note 3) |
(1,431 | ) | ||||
Administrative servicing fees voluntarily waived Institutional Service Class (Note 3) (b) |
(2,157 | ) | ||||
Expenses reimbursed by adviser (Note 3) |
(158,357 | ) | ||||
|
|
|||||
Net Expenses |
378,126 | |||||
|
|
|||||
NET INVESTMENT INCOME |
251,994 | |||||
|
|
|||||
REALIZED/UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: |
||||||
Net realized gains from investment transactions |
2,268,257 | |||||
Net change in unrealized appreciation/(depreciation) from investments |
(62,445 | ) | ||||
|
|
|||||
Net realized/unrealized gains from investments |
2,205,812 | |||||
|
|
|||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS |
$ | 2,457,806 | ||||
|
|
|||||
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
The accompanying notes are an integral part of these financial statements.
92
Statements of Changes in Net Assets
Nationwide HighMark Balanced Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
Operations: |
||||||||||||
Net investment income |
$ | 251,994 | $ | 263,858 | ||||||||
Net realized gains from investments |
2,268,257 | 2,056,942 | ||||||||||
Net change in unrealized appreciation/(depreciation) from investments |
(62,445 | ) | (60,153 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets resulting from operations |
2,457,806 | 2,260,647 | ||||||||||
|
|
|
|
|||||||||
Distributions to Shareholders From: |
||||||||||||
Net investment income: |
||||||||||||
Class A |
(89,216 | ) | (80,133 | ) | ||||||||
Class B (a) |
| (164 | ) | |||||||||
Class C |
(11,731 | ) | (8,365 | ) | ||||||||
Institutional Service Class (b) |
(143,211 | ) | (216,399 | ) | ||||||||
Institutional Class |
(234 | )(c) | | |||||||||
Net realized gains: |
||||||||||||
Class A |
(941,399 | ) | (219,482 | ) | ||||||||
Class B (a) |
| (1,094 | ) | |||||||||
Class C |
(415,313 | ) | (49,397 | ) | ||||||||
Institutional Service Class (b) |
(1,100,257 | ) | (489,144 | ) | ||||||||
Institutional Class |
(857 | )(c) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from shareholder distributions |
(2,702,218 | ) | (1,064,178 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
(2,067,547 | ) | 8,072,990 | |||||||||
|
|
|
|
|||||||||
Change in net assets |
(2,311,959 | ) | 9,269,459 | |||||||||
|
|
|
|
|||||||||
Net Assets: |
||||||||||||
Beginning of year |
33,746,505 | 24,477,046 | ||||||||||
|
|
|
|
|||||||||
End of year |
$ | 31,434,546 | $ | 33,746,505 | ||||||||
|
|
|
|
|||||||||
Accumulated undistributed net investment income at end of year |
$ | 24,537 | $ | 3,250 | ||||||||
|
|
|
|
|||||||||
CAPITAL TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
$ | 1,773,791 | $ | 6,943,883 | ||||||||
Proceeds from shares issued from class conversion |
15,114 | | ||||||||||
Dividends reinvested |
1,013,667 | 280,741 | ||||||||||
Cost of shares redeemed |
(3,197,282 | ) | (2,700,169 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
(394,710 | ) | 4,524,455 | |||||||||
|
|
|
|
|||||||||
Class B Shares (Note 12)(a) |
||||||||||||
Proceeds from shares issued |
| | ||||||||||
Dividends reinvested |
| 1,258 | ||||||||||
Cost of shares redeemed in class conversion |
(15,114 | ) | | |||||||||
Cost of shares redeemed |
(1,289 | ) | (24,355 | ) | ||||||||
|
|
|
|
|||||||||
Total Class B Shares |
(16,403 | ) | (23,097 | ) | ||||||||
|
|
|
|
|||||||||
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(c) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
93
Statements of Changes in Net Assets (Continued)
Nationwide HighMark Balanced Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
CAPITAL TRANSACTIONS: (continued) |
||||||||||||
Class C Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
$ | 1,204,118 | $ | 3,974,799 | ||||||||
Dividends reinvested |
414,088 | 55,438 | ||||||||||
Cost of shares redeemed |
(934,001 | ) | (571,877 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
684,205 | 3,458,360 | ||||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 12)(b) |
||||||||||||
Proceeds from shares issued |
3,598,818 | 3,637,134 | ||||||||||
Dividends reinvested |
1,243,451 | 705,479 | ||||||||||
Cost of shares redeemed |
(7,244,056 | ) | (4,229,341 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
(2,401,787 | ) | 113,272 | |||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Proceeds from shares issued |
60,057 | (c) | | |||||||||
Dividends reinvested |
1,091 | (c) | | |||||||||
Cost of shares redeemed |
| (c) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
61,148 | (c) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
$ | (2,067,547 | ) | $ | 8,072,990 | |||||||
|
|
|
|
|||||||||
SHARE TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Issued |
115,129 | 451,648 | ||||||||||
Issued in class conversion |
960 | | ||||||||||
Reinvested |
68,764 | 18,899 | ||||||||||
Redeemed |
(206,458 | ) | (177,068 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
(21,605 | ) | 293,479 | |||||||||
|
|
|
|
|||||||||
Class B Shares (Note 12)(a) |
||||||||||||
Issued |
| | ||||||||||
Reinvested |
| 85 | ||||||||||
Redeemed in class conversion |
(964 | ) | | |||||||||
Redeemed |
(82 | ) | (1,644 | ) | ||||||||
|
|
|
|
|||||||||
Total Class B Shares |
(1,046 | ) | (1,559 | ) | ||||||||
|
|
|
|
|||||||||
Class C Shares (Note 12) |
||||||||||||
Issued |
79,278 | 258,222 | ||||||||||
Reinvested |
28,295 | 3,774 | ||||||||||
Redeemed |
(60,251 | ) | (37,355 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
47,322 | 224,641 | ||||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 12)(b) |
||||||||||||
Issued |
233,244 | 235,903 | ||||||||||
Reinvested |
84,116 | 47,314 | ||||||||||
Redeemed |
(457,882 | ) | (276,326 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
(140,522 | ) | 6,891 | |||||||||
|
|
|
|
|||||||||
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(c) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
94
Statements of Changes in Net Assets (Continued)
Nationwide HighMark Balanced Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
SHARE TRANSACTIONS: (continued) |
||||||||||||
Institutional Class Shares |
||||||||||||
Issued |
3,922 | (c) | | |||||||||
Reinvested |
73 | (c) | | |||||||||
Redeemed |
| (c) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
3,995 | (c) | | |||||||||
|
|
|
|
|||||||||
Total change in shares |
(111,856 | ) | 523,452 | |||||||||
|
|
|
|
|||||||||
Amounts designated as are zero or have been rounded to zero.
(c) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
95
Financial Highlights
Selected data for each share of capital outstanding throughout the periods indicated
Nationwide HighMark Balanced Fund
Operations | Distributions | Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period |
Net Investment |
Net Realized (Losses) |
Total from Operations |
Net Investment |
Net Realized |
Total Distributions |
Net Asset Value, End of Period |
Total Return (a)(b)(c) |
Net Assets at End of Period |
Ratio of Expenses to Average Net Assets (d) |
Ratio of Net Investment Income to Average Net Assets (d) |
Ratio of Expenses (Prior to Reimbursements) to Average Net Assets (d)(e) |
Portfolio Turnover (f) |
|||||||||||||||||||||||||||||||||||||||||||
Class A Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 15.76 | 0.12 | 1.11 | 1.23 | (0.13 | ) | (1.37 | ) | (1.50 | ) | $ | 15.49 | 8.34% | $ | 10,968,069 | 1.24% | 0.80% | 1.72% | 51.49% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 15.12 | 0.14 | 1.12 | 1.26 | (0.16 | ) | (0.46 | ) | (0.62 | ) | $ | 15.76 | 8.60% | $ | 11,496,106 | 1.24% | 0.87% | 1.81% | 44.00% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 13.90 | 0.16 | 1.21 | 1.37 | (0.15 | ) | | (0.15 | ) | $ | 15.12 | 9.94% | $ | 6,590,640 | 1.24% | 1.10% | 1.88% | 46.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 12.53 | 0.13 | 1.43 | 1.56 | (0.19 | ) | | (0.19 | ) | $ | 13.90 | 12.50% | $ | 6,341,488 | 1.24% | 0.96% | 1.79% | 50.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 11.29 | 0.19 | 1.19 | 1.38 | (0.14 | ) | | (0.14 | ) | $ | 12.53 | 12.24% | $ | 5,656,999 | 1.23% | 1.56% | 1.85% | 31.00% | |||||||||||||||||||||||||||||||||||||
Class C Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 15.66 | 0.03 | 1.10 | 1.13 | (0.04 | ) | (1.37 | ) | (1.41 | ) | $ | 15.38 | 7.69% | $ | 5,544,829 | 1.84% | 0.20% | 2.38% | 51.49% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 15.02 | 0.04 | 1.13 | 1.17 | (0.07 | ) | (0.46 | ) | (0.53 | ) | $ | 15.66 | 8.03% | $ | 4,903,200 | 1.84% | 0.27% | 2.31% | 44.00% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 13.81 | 0.07 | 1.21 | 1.28 | (0.07 | ) | | (0.07 | ) | $ | 15.02 | 9.27% | $ | 1,330,078 | 1.84% | 0.50% | 2.38% | 46.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 12.46 | 0.05 | 1.42 | 1.47 | (0.12 | ) | | (0.12 | ) | $ | 13.81 | 11.80% | $ | 853,968 | 1.84% | 0.36% | 2.29% | 50.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 11.22 | 0.12 | 1.18 | 1.30 | (0.06 | ) | | (0.06 | ) | $ | 12.46 | 11.61% | $ | 510,316 | 1.83% | 0.96% | 2.35% | 31.00% | |||||||||||||||||||||||||||||||||||||
Institutional Service Class Shares (h) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 15.80 | 0.16 | 1.11 | 1.27 | (0.17 | ) | (1.37 | ) | (1.54 | ) | $ | 15.53 | 8.59% | $ | 14,859,466 | 0.99% | 1.05% | 1.54% | 51.49% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 15.15 | 0.17 | 1.13 | 1.30 | (0.20 | ) | (0.45 | ) | (0.65 | ) | $ | 15.80 | 8.91% | $ | 17,330,766 | 0.99% | 1.12% | 1.56% | 44.00% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 13.93 | 0.19 | 1.21 | 1.40 | (0.18 | ) | | (0.18 | ) | $ | 15.15 | 10.19% | $ | 16,517,048 | 0.99% | 1.35% | 1.63% | 46.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 12.56 | 0.16 | 1.43 | 1.59 | (0.22 | ) | | (0.22 | ) | $ | 13.93 | 12.72% | $ | 18,267,117 | 0.99% | 1.21% | 1.54% | 50.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 11.31 | 0.22 | 1.20 | 1.42 | (0.17 | ) | | (0.17 | ) | $ | 12.56 | 12.60% | $ | 17,551,594 | 0.98% | 1.81% | 1.60% | 31.00% | |||||||||||||||||||||||||||||||||||||
Institutional Class Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Period Ended July 31, 2014 (g)(i) |
$ | 16.03 | 0.16 | 0.90 | 1.06 | (0.16 | ) | (1.37 | ) | (1.53 | ) | $ | 15.56 | 7.18% | $ | 62,182 | 0.84% | 1.15% | 1.30% | 51.49% | ||||||||||||||||||||||||||||||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Excludes sales charge. |
(b) | Not annualized for periods less than one year. |
(c) | Total returns prior to the Funds inception date on September 16, 2013 are based on the performance of the Funds predecessor fund. |
(d) | Annualized for periods less than one year. |
(e) | During the period, certain fees may have been waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(f) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(g) | Per share calculations were performed using average shares method. |
(h) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(i) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. Total return is calculated based on inception date of September 18, 2013 through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
96
Fund Commentary | Nationwide HighMark Large Cap Core Equity Fund |
97
Fund Overview | Nationwide HighMark Large Cap Core Equity Fund |
| Percentages indicated are based upon net assets as of July 31, 2014. |
| Percentages indicated are based upon total investments as of July 31, 2014. |
98
Fund Performance | Nationwide HighMark Large Cap Core Equity Fund |
99
Fund Performance (cont.) | Nationwide HighMark Large Cap Core Equity Fund |
Performance of a $10,000 Investment
Investment return and principal value will fluctuate, and when redeemed, shares may be worth more or less than original cost. Past performance is no guarantee of future results and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Investing in mutual funds involves market risk, including loss of principal. Performance returns assume the reinvestment of all distributions.
Comparative performance of $10,000 invested in Institutional Service Class shares of the Nationwide HighMark Large Cap Core Equity Fund versus the S&P 500® Index and the Consumer Price Index (CPI) over the 10-year period ended 7/31/14. Fund performance prior to the Funds inception on 9/16/13 is based on the Funds predecessor fund. Unlike the Fund, the performance for these unmanaged indexes does not reflect any fees, expenses, or sales charges. One cannot invest directly in a market index. A description of the benchmarks can be found on the Market Index Definitions page at the back of this book.
100
Shareholder Expense Example | Nationwide HighMark Large Cap Core Equity Fund |
Schedule of Shareholder Expenses
Expense Analysis of a $1,000 Investment
Nationwide HighMark Large July 31, 2014 |
Beginning Account Value ($) 02/01/14 |
Ending Account Value ($) 07/31/14 |
Expenses Paid During Period ($) 02/01/14 - 07/31/14 |
Expense Ratio During Period (%) 02/01/14 - 07/31/14 | ||||||||
Class A Shares | Actual | (a) | 1,000.00 | 1,097.50 | 6.34 | 1.22 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,018.74 | 6.11 | 1.22 | ||||||||
Class C Shares | Actual | (a) | 1,000.00 | 1,094.70 | 9.45 | 1.82 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,015.77 | 9.10 | 1.82 | ||||||||
Institutional Service Class Shares(c) | Actual | (a) | 1,000.00 | 1,099.60 | 5.05 | 0.97 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,019.98 | 4.86 | 0.97 | ||||||||
Institutional Class Shares | Actual | (a) | 1,000.00 | 1,100.10 | 4.27 | 0.82 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,020.73 | 4.11 | 0.82 |
(a) | Expenses are equal to the Funds annualized expense ratio multiplied by the average account value from February 1, 2014 through July 31, 2014 multiplied to reflect one-half year period. The expense ratio presented represents a six-month, annualized ratio in accordance with Securities and Exchange Commission guidelines. |
(b) | Represents the hypothetical 5% return before expenses. |
(c) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
101
Statement of Investments
July 31, 2014
Nationwide HighMark Large Cap Core Equity Fund
102
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Large Cap Core Equity Fund (Continued)
103
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Large Cap Core Equity Fund (Continued)
At July 31, 2014, the Funds open futures contracts were as follows (Note 2):
Number of Contracts |
Long Contracts | Expiration | Notional Value Covered by Contracts |
Unrealized Appreciation/ (Depreciation) |
||||||||||
26 | E-mini S&P 500 | 09/19/14 | $ | 2,502,240 | $ | (32,533 | ) | |||||||
|
|
|
|
The accompanying notes are an integral part of these financial statements.
104
Statement of Assets and Liabilities
July 31, 2014
Nationwide HighMark Large Cap Core Equity Fund | ||||||
Assets: |
||||||
Investments, at value (cost $47,751,913) |
$ | 61,276,657 | ||||
Cash |
2,537,198 | |||||
Dividends receivable |
58,222 | |||||
Receivable for investments sold |
1,757,026 | |||||
Receivable for capital shares issued |
138,308 | |||||
Reclaims receivable |
163 | |||||
Receivable for variation margin on futures contracts |
67,215 | |||||
Prepaid expenses |
13,647 | |||||
|
|
|||||
Total Assets |
65,848,436 | |||||
|
|
|||||
Liabilities: |
||||||
Payable for investments purchased |
1,893,630 | |||||
Payable for capital shares redeemed |
7,969 | |||||
Accrued expenses and other payables: |
||||||
Investment advisory fees |
35,709 | |||||
Fund administration fees |
7,999 | |||||
Distribution fees |
3,393 | |||||
Administrative servicing fees |
33,269 | |||||
Accounting and transfer agent fees |
780 | |||||
Trustee fees |
154 | |||||
Custodian fees |
245 | |||||
Compliance program costs (Note 3) |
718 | |||||
Professional fees |
22,420 | |||||
Printing fees |
2,834 | |||||
Other |
3,506 | |||||
|
|
|||||
Total Liabilities |
2,012,626 | |||||
|
|
|||||
Net Assets |
$ | 63,835,810 | ||||
|
|
|||||
Represented by: |
||||||
Capital |
$ | 49,933,970 | ||||
Accumulated undistributed net investment income |
264,787 | |||||
Accumulated net realized gains from investments and futures transactions |
144,842 | |||||
Net unrealized appreciation/(depreciation) from investments |
13,524,744 | |||||
Net unrealized appreciation/(depreciation) from futures contracts (Note 2) |
(32,533 | ) | ||||
|
|
|||||
Net Assets |
$ | 63,835,810 | ||||
|
|
|||||
Net Assets: |
||||||
Class A Shares |
$ | 11,954,280 | ||||
Class C Shares |
1,008,150 | |||||
Institutional Service Class Shares |
50,826,838 | |||||
Institutional Class Shares |
46,542 | |||||
|
|
|||||
Total |
$ | 63,835,810 | ||||
|
|
|||||
105
Statement of Assets and Liabilities (Continued)
July 31, 2014
Nationwide HighMark Large Cap Core Equity Fund | ||||||
Shares Outstanding (unlimited number of shares authorized): |
||||||
Class A Shares |
906,144 | |||||
Class C Shares |
78,903 | |||||
Institutional Service Class Shares |
3,842,731 | |||||
Institutional Class Shares |
3,520 | |||||
|
|
|||||
Total |
4,831,298 | |||||
|
|
|||||
Net asset value and redemption price per share (Net assets by class divided by shares outstanding by class, respectively): |
||||||
Class A Shares (a) |
$ | 13.19 | ||||
Class C Shares (b) |
$ | 12.78 | ||||
Institutional Service Class Shares |
$ | 13.23 | ||||
Institutional Class Shares |
$ | 13.22 | ||||
Maximum offering price per share (100%/(100%-maximum sales charge) of net asset value adjusted to the nearest cent): |
||||||
Class A Shares |
$ | 13.99 | ||||
|
|
|||||
Maximum Sales Charge: |
||||||
Class A Shares |
5.75 | % | ||||
|
|
|||||
(a) | For Class A Shares, the redemption price per share is reduced by 1.00% on sales of shares of original purchases of $1,000,000 or more or that were not subject to a front-end sales charge made within 18 months of the purchase date. |
(b) | For Class C Shares, the redemption price per share is reduced by 1.00% for shares held less than one year. |
The accompanying notes are an integral part of these financial statements.
106
Statement of Operations
For the Year Ended July 31, 2014
Nationwide HighMark Large Cap Core Equity Fund | ||||||
INVESTMENT INCOME: |
||||||
Dividend income |
$ | 1,171,031 | ||||
Interest income |
57 | |||||
|
|
|||||
Total Income |
1,171,088 | |||||
|
|
|||||
EXPENSES: |
||||||
Investment advisory fees |
365,276 | |||||
Fund administration fees |
101,253 | |||||
Distribution fees Class A |
26,743 | |||||
Distribution fees Class C |
9,710 | |||||
Administrative servicing fees Class A |
15,106 | |||||
Administrative servicing fees Class C |
329 | |||||
Administrative servicing fees Institutional Service Class (a) |
49,081 | |||||
Registration and filing fees |
47,100 | |||||
Professional fees |
32,001 | |||||
Printing fees |
10,654 | |||||
Trustee fees |
1,493 | |||||
Custodian fees |
2,499 | |||||
Accounting and transfer agent fees |
4,714 | |||||
Compliance program costs (Note 3) |
1,597 | |||||
Other |
11,749 | |||||
|
|
|||||
Total expenses before earnings credit, fees waived, and expenses reimbursed |
679,305 | |||||
|
|
|||||
Earnings credit (Note 5) |
(34 | ) | ||||
Administrative servicing fees voluntarily waived Class A (Note 3) |
(1,219 | ) | ||||
Administrative servicing fees voluntarily waived Institutional Service Class (Note 3) (a) |
(6,159 | ) | ||||
Expenses reimbursed by adviser (Note 3) |
(46,176 | ) | ||||
|
|
|||||
Net Expenses |
625,717 | |||||
|
|
|||||
NET INVESTMENT INCOME |
545,371 | |||||
|
|
|||||
REALIZED/UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: |
||||||
Net realized gains from investment transactions |
6,559,504 | |||||
Net realized gains from futures transactions (Note 2) |
334,482 | |||||
|
|
|||||
Net realized gains from investments and futures transactions |
6,893,986 | |||||
|
|
|||||
Net change in unrealized appreciation/(depreciation) from investments |
1,470,210 | |||||
Net change in unrealized appreciation/(depreciation) from futures contracts (Note 2) |
(26,899 | ) | ||||
|
|
|||||
Net change in unrealized appreciation/(depreciation) from investments and futures contracts |
1,443,311 | |||||
|
|
|||||
Net realized/unrealized gains from investments and futures transactions |
8,337,297 | |||||
|
|
|||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS |
$ | 8,882,668 | ||||
|
|
|||||
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
The accompanying notes are an integral part of these financial statements.
107
Statements of Changes in Net Assets
Nationwide HighMark Large Cap Core Equity Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
Operations: |
||||||||||||
Net investment income |
$ | 545,371 | $ | 852,788 | ||||||||
Net realized gains from investments and futures transactions |
6,893,986 | 10,629,141 | ||||||||||
Net change in unrealized appreciation/(depreciation) from investments and futures contracts |
1,443,311 | 4,812,139 | ||||||||||
|
|
|
|
|||||||||
Change in net assets resulting from operations |
8,882,668 | 16,294,068 | ||||||||||
|
|
|
|
|||||||||
Distributions to Shareholders From: |
||||||||||||
Net investment income: |
||||||||||||
Class A |
(32,211 | ) | (52,788 | ) | ||||||||
Class C |
(464 | ) | (3,112 | ) | ||||||||
Institutional Service Class (a) |
(258,727 | ) | (779,460 | ) | ||||||||
Institutional Class |
(145 | )(b) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from shareholder distributions |
(291,547 | ) | (835,360 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
(5,542,422 | ) | (18,016,074 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets |
3,048,699 | (2,557,366 | ) | |||||||||
|
|
|
|
|||||||||
Net Assets: |
||||||||||||
Beginning of year |
60,787,111 | 63,344,477 | ||||||||||
|
|
|
|
|||||||||
End of year |
$ | 63,835,810 | $ | 60,787,111 | ||||||||
|
|
|
|
|||||||||
Accumulated undistributed net investment income at end of year |
$ | 264,787 | $ | 17,428 | ||||||||
|
|
|
|
|||||||||
CAPITAL TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
$ | 2,145,113 | $ | 6,029,593 | ||||||||
Dividends reinvested |
31,760 | 51,016 | ||||||||||
Cost of shares redeemed |
(1,539,028 | ) | (1,153,545 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
637,845 | 4,927,064 | ||||||||||
|
|
|
|
|||||||||
Class C Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
166,542 | 175,860 | ||||||||||
Dividends reinvested |
291 | 1,826 | ||||||||||
Cost of shares redeemed |
(290,879 | ) | (136,248 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
(124,046 | ) | 41,438 | |||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 12)(a) |
||||||||||||
Proceeds from shares issued |
2,459,725 | 9,027,736 | ||||||||||
Dividends reinvested |
17,540 | 271,828 | ||||||||||
Cost of shares redeemed |
(8,578,107 | ) | (32,284,140 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
(6,100,842 | ) | (22,984,576 | ) | ||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Proceeds from shares issued |
44,476 | (b) | | |||||||||
Dividends reinvested |
145 | (b) | | |||||||||
Cost of shares redeemed |
| (b) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
44,621 | (b) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
$ | (5,542,422 | ) | $ | (18,016,074 | ) | ||||||
|
|
|
|
|||||||||
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(b) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
108
Statements of Changes in Net Assets (Continued)
Nationwide HighMark Large Cap Core Equity Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
SHARE TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Issued |
171,269 | 577,813 | ||||||||||
Reinvested |
2,440 | 4,869 | ||||||||||
Redeemed |
(125,004 | ) | (111,058 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
48,705 | 471,624 | ||||||||||
|
|
|
|
|||||||||
Class C Shares (Note 12) |
||||||||||||
Issued |
13,787 | 17,857 | ||||||||||
Reinvested |
23 | 182 | ||||||||||
Redeemed |
(24,558 | ) | (14,178 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
(10,748 | ) | 3,861 | |||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 12)(a) |
||||||||||||
Issued |
191,983 | 927,552 | ||||||||||
Reinvested |
1,364 | 26,611 | ||||||||||
Redeemed |
(713,995 | ) | (3,014,582 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
(520,648 | ) | (2,060,419 | ) | ||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Issued |
3,509 | (b) | | |||||||||
Reinvested |
11 | (b) | | |||||||||
Redeemed |
| (b) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
3,520 | (b) | | |||||||||
|
|
|
|
|||||||||
Total change in shares |
(479,171 | ) | (1,584,934 | ) | ||||||||
|
|
|
|
|||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(b) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
109
Financial Highlights
Selected data for each share of capital outstanding throughout the periods indicated
Nationwide HighMark Large Cap Core Equity Fund
Operations | Distributions | Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period |
Net Investment Income |
Net Realized and Unrealized Gains from Investments |
Total from Operations |
Net Investment Income |
Total Distributions |
Net Asset Value, End |
Total Return (a)(b)(c) |
Net Assets at End of Period |
Ratio of Expenses to Average Net Assets (d) |
Ratio of Net Investment Income to Average Net Assets (d) |
Ratio of Expenses (Prior to Reimbursements) to Average Net Assets (d)(e) |
Portfolio Turnover (f) |
||||||||||||||||||||||||||||||||||||||||
Class A Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 11.43 | 0.09 | 1.71 | 1.80 | (0.04 | ) | (0.04 | ) | $ | 13.19 | 15.72% | $ | 11,954,280 | 1.22% | 0.70% | 1.34% | 47.69% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 9.17 | 0.10 | 2.25 | 2.35 | (0.09 | ) | (0.09 | ) | $ | 11.43 | 25.80% | $ | 9,799,235 | 1.22% | 0.96% | 1.45% | 63.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 8.47 | 0.06 | 0.71 | 0.77 | (0.07 | ) | (0.07 | ) | $ | 9.17 | 9.12% | $ | 3,537,695 | 1.23% | 0.72% | 1.53% | 78.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 7.23 | 0.07 | 1.24 | 1.31 | (0.07 | ) | (0.07 | ) | $ | 8.47 | 18.15% | $ | 3,027,452 | 1.25% | 0.79% | 1.48% | 68.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 6.38 | 0.06 | 0.85 | 0.91 | (0.06 | ) | (0.06 | ) | $ | 7.23 | 14.27% | $ | 2,640,213 | 1.23% | 0.85% | 1.47% | 93.00% | ||||||||||||||||||||||||||||||||||
Class C Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 11.11 | 0.01 | 1.67 | 1.68 | (0.01 | ) | (0.01 | ) | $ | 12.78 | 15.09% | $ | 1,008,150 | 1.82% | 0.11% | 1.99% | 47.69% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 8.92 | 0.04 | 2.19 | 2.23 | (0.04 | ) | (0.04 | ) | $ | 11.11 | 25.01% | $ | 995,957 | 1.82% | 0.36% | 1.95% | 63.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 8.24 | 0.01 | 0.69 | 0.70 | (0.02 | ) | (0.02 | ) | $ | 8.92 | 8.47% | $ | 765,173 | 1.83% | 0.12% | 2.03% | 78.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 7.03 | 0.02 | 1.21 | 1.23 | (0.02 | ) | (0.02 | ) | $ | 8.24 | 17.48% | $ | 639,507 | 1.85% | 0.19% | 1.98% | 68.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 6.21 | 0.02 | 0.82 | 0.84 | (0.02 | ) | (0.02 | ) | $ | 7.03 | 13.50% | $ | 440,991 | 1.83% | 0.25% | 1.97% | 93.00% | ||||||||||||||||||||||||||||||||||
Institutional Service Class Shares (h) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 11.46 | 0.12 | 1.72 | 1.84 | (0.07 | ) | (0.07 | ) | $ | 13.23 | 16.04% | $ | 50,826,838 | 0.97% | 0.95% | 1.05% | 47.69% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 9.19 | 0.13 | 2.26 | 2.39 | (0.12 | ) | (0.12 | ) | $ | 11.46 | 26.21% | $ | 49,991,919 | 0.93% | 1.25% | 1.20% | 63.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 8.49 | 0.09 | 0.70 | 0.79 | (0.09 | ) | (0.09 | ) | $ | 9.19 | 9.39% | $ | 59,041,609 | 0.93% | 1.02% | 1.28% | 78.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 7.24 | 0.09 | 1.25 | 1.34 | (0.09 | ) | (0.09 | ) | $ | 8.49 | 18.63% | $ | 53,369,484 | 0.96% | 1.09% | 1.23% | 68.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 6.39 | 0.08 | 0.85 | 0.93 | (0.08 | ) | (0.08 | ) | $ | 7.24 | 14.56% | $ | 55,593,087 | 0.95% | 1.13% | 1.22% | 93.00% | ||||||||||||||||||||||||||||||||||
Institutional Class Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Period Ended July 31, 2014 (g)(i) |
$ | 11.73 | 0.13 | 1.44 | 1.57 | (0.08 | ) | (0.08 | ) | $ | 13.22 | 13.44% | $ | 46,542 | 0.82% | 1.12% | 0.92% | 47.69% | ||||||||||||||||||||||||||||||||||
(a) | Excludes sales charge. |
(b) | Not annualized for periods less than one year. |
(c) | Total returns prior to the Funds inception on September 16, 2013 are based on the performance of the Funds predecessor fund. |
(d) | Annualized for periods less than one year. |
(e) | During the period, certain fees may have been waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(f) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(g) | Per share calculations were performed using average shares method. |
(h) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(i) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. Total return is calculated based on inception date of September 18, 2013 through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
110
Fund Commentary | Nationwide HighMark Large Cap Growth Fund |
111
Fund Overview | Nationwide HighMark Large Cap Growth Fund |
| Percentages indicated are based upon net assets as of July 31, 2014. |
| Amount rounds to less than 0.1%. |
| Percentages indicated are based upon total investments as of July 31, 2014. |
112
Fund Performance | Nationwide HighMark Large Cap Growth Fund |
113
Fund Performance (cont.) | Nationwide HighMark Large Cap Growth Fund |
Performance of a $10,000 Investment
Investment return and principal value will fluctuate, and when redeemed, shares may be worth more or less than original cost. Past performance is no guarantee of future results and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Investing in mutual funds involves market risk, including loss of principal. Performance returns assume the reinvestment of all distributions.
Comparative performance of $10,000 invested in Institutional Service Class shares of the Nationwide HighMark Large Cap Growth Fund versus the Russell 1000® Growth Index and the Consumer Price Index (CPI) over the 10-year period ended 7/31/14. Fund performance prior to the Funds inception on 9/16/13 is based on the Funds predecessor fund. Unlike the Fund, the performance for these unmanaged indexes does not reflect any fees, expenses, or sales charges. One cannot invest directly in a market index. A description of the benchmarks can be found on the Market Index Definitions page at the back of this book.
114
Shareholder Expense Example | Nationwide HighMark Large Cap Growth Fund |
Schedule of Shareholder Expenses
Expense Analysis of a $1,000 Investment
Nationwide HighMark Large Cap July 31, 2014 |
Beginning Account Value ($) 02/01/14 |
Ending Account Value ($) 07/31/14 |
Expenses Paid During Period ($) 02/01/14 - 07/31/14 |
Expense Ratio During Period (%) 02/01/14 - 07/31/14 | ||||||||
Class A Shares | Actual | (a) | 1,000.00 | 1,075.10 | 6.53 | 1.27 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,018.50 | 6.36 | 1.27 | |||||||
Class C Shares | Actual | (a) | 1,000.00 | 1,071.40 | 9.60 | 1.87 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,015.52 | 9.35 | 1.87 | |||||||
Institutional Service Class Shares(c) |
Actual | (a) | 1,000.00 | 1,076.00 | 5.25 | 1.02 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,019.74 | 5.11 | 1.02 | |||||||
Institutional Class Shares | Actual | (a) | 1,000.00 | 1,076.70 | 4.48 | 0.87 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,020.48 | 4.36 | 0.87 |
(a) | Expenses are equal to the Funds annualized expense ratio multiplied by the average account value from February 1, 2014 through July 31, 2014 multiplied to reflect one-half year period. The expense ratio presented represents a six-month, annualized ratio in accordance with Securities and Exchange Commission guidelines. |
(b) | Represents the hypothetical 5% return before expenses. |
(c) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
115
Statement of Investments
July 31, 2014
Nationwide HighMark Large Cap Growth Fund
116
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Large Cap Growth Fund (Continued)
The accompanying notes are an integral part of these financial statements.
117
Statement of Assets and Liabilities
July 31, 2014
Nationwide Large Cap | ||||||
Assets: |
||||||
Investments, at value (cost $45,186,094) |
$ | 58,826,481 | ||||
Cash |
87,032 | |||||
Dividends receivable |
15,223 | |||||
Receivable for capital shares issued |
43,173 | |||||
Reclaims receivable |
13,652 | |||||
Prepaid expenses |
8,823 | |||||
|
|
|||||
Total Assets |
58,994,384 | |||||
|
|
|||||
Liabilities: |
||||||
Payable for capital shares redeemed |
36,919 | |||||
Accrued expenses and other payables: |
||||||
Investment advisory fees |
44,929 | |||||
Fund administration fees |
9,224 | |||||
Distribution fees |
5,928 | |||||
Administrative servicing fees |
24,595 | |||||
Accounting and transfer agent fees |
4,156 | |||||
Trustee fees |
189 | |||||
Custodian fees |
212 | |||||
Compliance program costs (Note 3) |
1,225 | |||||
Professional fees |
22,283 | |||||
Printing fees |
4,680 | |||||
Other |
3,502 | |||||
|
|
|||||
Total Liabilities |
157,842 | |||||
|
|
|||||
Net Assets |
$ | 58,836,542 | ||||
|
|
|||||
Represented by: |
||||||
Capital |
$ | 33,367,088 | ||||
Accumulated undistributed net investment income |
71,118 | |||||
Accumulated net realized gains from investments |
11,757,949 | |||||
Net unrealized appreciation/(depreciation) from investments |
13,640,387 | |||||
|
|
|||||
Net Assets |
$ | 58,836,542 | ||||
|
|
|||||
Net Assets: |
||||||
Class A Shares |
$ | 16,293,038 | ||||
Class C Shares |
2,709,588 | |||||
Institutional Service Class Shares |
39,822,695 | |||||
Institutional Class Shares |
11,221 | |||||
|
|
|||||
Total |
$ | 58,836,542 | ||||
|
|
|||||
Shares Outstanding (unlimited number of shares authorized): |
||||||
Class A Shares |
1,168,249 | |||||
Class C Shares |
212,574 | |||||
Institutional Service Class Shares |
2,802,076 | |||||
Institutional Class Shares |
790 | |||||
|
|
|||||
Total |
4,183,689 | |||||
|
|
|||||
118
Statement of Assets and Liabilities (Continued)
July 31, 2014
Nationwide Large Cap | ||||||
Net asset value and redemption price per share (Net assets by class divided by shares outstanding by class, respectively): |
||||||
Class A Shares (a) |
$ | 13.95 | ||||
Class C Shares (b) |
$ | 12.75 | ||||
Institutional Service Class Shares |
$ | 14.21 | ||||
Institutional Class Shares |
$ | 14.20 | ||||
Maximum offering price per share (100%/(100%-maximum sales charge) of net asset value adjusted to the nearest cent): |
||||||
Class A Shares |
$ | 14.80 | ||||
|
|
|||||
Maximum Sales Charge: |
||||||
Class A Shares |
5.75 | % | ||||
|
|
|||||
(a) | For Class A Shares, the redemption price per share is reduced by 1.00% on sales of shares of original purchases of $1,000,000 or more or that were not subject to a front-end sales charge made within 18 months of the purchase date. |
(b) | For Class C Shares, the redemption price per share is reduced by 1.00% for shares held less than one year. |
The accompanying notes are an integral part of these financial statements.
119
Statement of Operations
For the Year Ended July 31, 2014
Nationwide Large
Cap Growth Fund | ||||||
INVESTMENT INCOME: |
||||||
Dividend income |
$ | 937,970 | ||||
Foreign tax withholding |
(1,764 | ) | ||||
|
|
|||||
Total Income |
936,206 | |||||
|
|
|||||
EXPENSES: |
||||||
Investment advisory fees |
415,766 | |||||
Fund administration fees |
123,080 | |||||
Distribution fees Class A |
42,190 | |||||
Distribution fees Class B (a) |
404 | |||||
Distribution fees Class C |
27,936 | |||||
Administrative servicing fees Class A |
18,882 | |||||
Administrative servicing fees Class B (a) |
135 | |||||
Administrative servicing fees Class C |
449 | |||||
Administrative servicing fees Institutional Service Class (b) |
74,063 | |||||
Registration and filing fees |
51,801 | |||||
Professional fees |
31,571 | |||||
Printing fees |
15,903 | |||||
Trustee fees |
1,614 | |||||
Custodian fees |
2,960 | |||||
Accounting and transfer agent fees |
21,540 | |||||
Compliance program costs (Note 3) |
1,720 | |||||
Other |
11,658 | |||||
|
|
|||||
Total expenses before earnings credit, fees waived, and expenses reimbursed |
841,672 | |||||
|
|
|||||
Earnings credit (Note 5) |
(114 | ) | ||||
Administrative servicing fees voluntarily waived Class A (Note 3) |
(2,088 | ) | ||||
Administrative servicing fees voluntarily waived Institutional Service Class (Note 3) (b) |
(6,565 | ) | ||||
Expenses reimbursed by adviser (Note 3) |
(60,039 | ) | ||||
|
|
|||||
Net Expenses |
772,866 | |||||
|
|
|||||
NET INVESTMENT INCOME |
163,340 | |||||
|
|
|||||
REALIZED/UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: |
||||||
Net realized gains from investment transactions |
11,790,472 | |||||
Net change in unrealized appreciation/(depreciation) from investments |
(3,544,983 | ) | ||||
|
|
|||||
Net realized/unrealized gains from investments |
8,245,489 | |||||
|
|
|||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS |
$ | 8,408,829 | ||||
|
|
|||||
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
The accompanying notes are an integral part of these financial statements.
120
Statements of Changes in Net Assets
Nationwide HighMark Large Cap Growth Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
Operations: |
||||||||||||
Net investment income |
$ | 163,340 | $ | 569,850 | ||||||||
Net realized gains from investments |
11,790,472 | 11,021,133 | ||||||||||
Net change in unrealized appreciation/(depreciation) from investments |
(3,544,983 | ) | (2,517,102 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets resulting from operations |
8,408,829 | 9,073,881 | ||||||||||
|
|
|
|
|||||||||
Distributions to Shareholders From: |
||||||||||||
Net investment income: |
||||||||||||
Class A |
(115,949 | ) | (23,724 | ) | ||||||||
Class B (a) |
| | ||||||||||
Class C |
(11,474 | ) | | |||||||||
Institutional Service Class (b) |
(477,701 | ) | (277,645 | ) | ||||||||
Institutional Class |
(122 | )(c) | | |||||||||
Net realized gains: |
||||||||||||
Class A |
(178,380 | ) | | |||||||||
Class B (a) |
| | ||||||||||
Class C |
(32,946 | ) | | |||||||||
Institutional Service Class (b) |
(525,076 | ) | | |||||||||
Institutional Class |
(106 | )(c) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from shareholder distributions |
(1,341,754 | ) | (301,369 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
(21,148,547 | ) | (8,939,605 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets |
(14,081,472 | ) | (167,093 | ) | ||||||||
|
|
|
|
|||||||||
Net Assets: |
||||||||||||
Beginning of year |
72,918,014 | 73,085,107 | ||||||||||
|
|
|
|
|||||||||
End of year |
$ | 58,836,542 | $ | 72,918,014 | ||||||||
|
|
|
|
|||||||||
Accumulated undistributed net investment income at end of year |
$ | 71,118 | $ | 513,024 | ||||||||
|
|
|
|
|||||||||
CAPITAL TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
$ | 348,756 | $ | 2,765,078 | ||||||||
Proceeds from shares issued from class conversion |
420,514 | | ||||||||||
Dividends reinvested |
270,652 | 21,570 | ||||||||||
Cost of shares redeemed |
(3,314,666 | ) | (4,618,218 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
(2,274,744 | ) | (1,831,570 | ) | ||||||||
|
|
|
|
|||||||||
Class B Shares (Note 12)(a) |
||||||||||||
Proceeds from shares issued |
1,748 | | ||||||||||
Dividends reinvested |
| | ||||||||||
Cost of shares redeemed in class conversion |
(420,514 | ) | | |||||||||
Cost of shares redeemed |
(33,806 | ) | (274,550 | ) | ||||||||
|
|
|
|
|||||||||
Total Class B Shares |
(452,572 | ) | (274,550 | ) | ||||||||
|
|
|
|
|||||||||
Class C Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
109,087 | 202,314 | ||||||||||
Dividends reinvested |
38,213 | | ||||||||||
Cost of shares redeemed |
(496,306 | ) | (349,735 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
(349,006 | ) | (147,421 | ) | ||||||||
|
|
|
|
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(c) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
121
Statements of Changes in Net Assets (Continued)
Nationwide HighMark Large Cap Growth Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
CAPITAL TRANSACTIONS: (continued) |
||||||||||||
Institutional Service Class Shares (Note 12)(b) |
||||||||||||
Proceeds from shares issued |
$ | 3,798,372 | $ | 9,884,756 | ||||||||
Dividends reinvested |
753,144 | 159,942 | ||||||||||
Cost of shares redeemed |
(22,634,257 | ) | (16,730,762 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
(18,082,741 | ) | (6,686,064 | ) | ||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Proceeds from shares issued |
10,288 | (c) | | |||||||||
Dividends reinvested |
228 | (c) | | |||||||||
Cost of shares redeemed |
| (c) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
10,516 | (c) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
$ | (21,148,547 | ) | $ | (8,939,605 | ) | ||||||
|
|
|
|
|||||||||
SHARE TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Issued |
26,392 | 240,066 | ||||||||||
Issued in class conversion |
32,961 | | ||||||||||
Reinvested |
20,757 | 1,916 | ||||||||||
Redeemed |
(247,495 | ) | (395,886 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
(167,385 | ) | (153,904 | ) | ||||||||
|
|
|
|
|||||||||
Class B Shares (Note 12)(a) |
||||||||||||
Issued |
153 | | ||||||||||
Reinvested |
| | ||||||||||
Redeemed in class conversion |
(35,603 | ) | | |||||||||
Redeemed |
(2,879 | ) | (25,260 | ) | ||||||||
|
|
|
|
|||||||||
Total Class B Shares |
(38,329 | ) | (25,260 | ) | ||||||||
|
|
|
|
|||||||||
Class C Shares (Note 12) |
||||||||||||
Issued |
9,187 | 19,005 | ||||||||||
Reinvested |
3,200 | | ||||||||||
Redeemed |
(40,700 | ) | (32,252 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
(28,313 | ) | (13,247 | ) | ||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 12)(b) |
||||||||||||
Issued |
280,176 | 831,934 | ||||||||||
Reinvested |
56,605 | 13,957 | ||||||||||
Redeemed |
(1,648,051 | ) | (1,367,544 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
(1,311,270 | ) | (521,653 | ) | ||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Issued |
773 | (c) | | |||||||||
Reinvested |
17 | (c) | | |||||||||
Redeemed |
| (c) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
790 | (c) | | |||||||||
|
|
|
|
|||||||||
Total change in shares |
(1,544,507 | ) | (714,064 | ) | ||||||||
|
|
|
|
|||||||||
|
|
|
|
Amounts designated as are zero or have been rounded to zero.
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(c) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
122
Financial Highlights
Selected data for each share of capital outstanding throughout the periods indicated
Nationwide HighMark Large Cap Growth Fund
Operations | Distributions | Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, |
Net Investment Income (Loss) |
Net Realized and Unrealized Gains from Investments |
Total from Operations |
Net Investment Income |
Net Realized Gains |
Total Distributions |
Net Asset of Period |
Total Return (a)(b)(c) |
Net Assets at End of Period |
Ratio of Expenses to Average Net Assets (d) |
Ratio of Net Income (Loss) to Average |
Ratio of Expenses (Prior to Reimbursements) to Average Net Assets (d)(e) |
Portfolio Turnover (f) |
|||||||||||||||||||||||||||||||||||||||||||
Class A Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 12.61 | 0.01 | 1.56 | 1.57 | (0.09 | ) | (0.14 | ) | (0.23 | ) | $ | 13.95 | 12.60 | % | $ | 16,293,038 | 1.27 | % | 0.07 | % | 1.34 | % | 40.70 | % | |||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 11.23 | 0.07 | 1.33 | 1.40 | (0.02 | ) | | (0.02 | ) | $ | 12.61 | 12.45 | % | $ | 16,839,693 | 1.27 | % | 0.58 | % | 1.49 | % | 41.00 | % | ||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 10.12 | 0.02 | 1.09 | 1.11 | | | | $ | 11.23 | 10.97 | % | $ | 16,721,772 | 1.27 | % | 0.17 | % | 1.52 | % | 53.00 | % | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 8.64 | | 1.57 | 1.57 | (0.09 | ) | | (0.09 | ) | $ | 10.12 | 18.16 | % | $ | 16,620,770 | 1.27 | % | (0.05 | %) | 1.49 | % | 41.00 | % | ||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 7.74 | 0.08 | 0.89 | 0.97 | (0.07 | ) | | (0.07 | ) | $ | 8.64 | 12.48 | % | $ | 19,881,394 | 1.25 | % | 0.89 | % | 1.46 | % | 34.00 | % | ||||||||||||||||||||||||||||||||
Class C Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 11.57 | (0.06 | ) | 1.43 | 1.37 | (0.05 | ) | (0.14 | ) | (0.19 | ) | $ | 12.75 | 11.95 | % | $ | 2,709,588 | 1.87 | % | (0.53 | %) | 1.99 | % | 40.70 | % | ||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 10.35 | | 1.22 | 1.22 | | | | $ | 11.57 | 11.79 | % | $ | 2,787,128 | 1.87 | % | (0.02 | %) | 1.99 | % | 41.00 | % | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 9.38 | (0.04 | ) | 1.01 | 0.97 | | | | $ | 10.35 | 10.34 | % | $ | 2,629,339 | 1.87 | % | (0.43 | %) | 2.02 | % | 53.00 | % | |||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 8.02 | (0.06 | ) | 1.45 | 1.39 | (0.03 | ) | | (0.03 | ) | $ | 9.38 | 17.36 | % | $ | 2,860,809 | 1.87 | % | (0.65 | %) | 1.99 | % | 41.00 | % | |||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 7.21 | 0.02 | 0.84 | 0.86 | (0.05 | ) | | (0.05 | ) | $ | 8.02 | 11.88 | % | $ | 3,250,012 | 1.85 | % | 0.29 | % | 1.96 | % | 34.00 | % | ||||||||||||||||||||||||||||||||
Institutional Service Class Shares (h) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 12.85 | 0.05 | 1.58 | 1.63 | (0.13 | ) | (0.14 | ) | (0.27 | ) | $ | 14.21 | 12.83 | % | $ | 39,822,695 | 1.02 | % | 0.33 | % | 1.13 | % | 40.70 | % | |||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 11.45 | 0.10 | 1.36 | 1.46 | (0.06 | ) | | (0.06 | ) | $ | 12.85 | 12.80 | % | $ | 52,843,472 | 1.01 | % | 0.84 | % | 1.24 | % | 41.00 | % | ||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 10.31 | 0.05 | 1.11 | 1.16 | (0.02 | ) | | (0.02 | ) | $ | 11.45 | 11.25 | % | $ | 53,069,738 | 1.01 | % | 0.43 | % | 1.27 | % | 53.00 | % | ||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 8.81 | 0.02 | 1.60 | 1.62 | (0.12 | ) | | (0.12 | ) | $ | 10.31 | 18.41 | % | $ | 57,206,982 | 1.01 | % | 0.21 | % | 1.24 | % | 41.00 | % | ||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 7.87 | 0.10 | 0.91 | 1.01 | (0.07 | ) | | (0.07 | ) | $ | 8.81 | 12.82 | % | $ | 60,078,249 | 0.99 | % | 1.16 | % | 1.21 | % | 34.00 | % | ||||||||||||||||||||||||||||||||
Institutional Class Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Period Ended July 31, 2014 (g)(i) |
$ | 13.29 | 0.05 | 1.16 | 1.21 | (0.16 | ) | (0.14 | ) | (0.30 | ) | $ | 14.20 | 9.27 | % | $ | 11,221 | 0.87 | % | 0.39 | % | 0.96 | % | 40.70 | % | |||||||||||||||||||||||||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Excludes sales charge. |
(b) | Not annualized for periods less than one year. |
(c) | Total returns prior to the Funds inception on September 16, 2013 are based on the performance of the Funds predecessor fund. |
(d) | Annualized for periods less than one year. |
(e) | During the period, certain fees may have been waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(f) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(g) | Per share calculations were performed using average shares method. |
(h) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(i) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. Total return is calculated based on inception date of September 18, 2013 through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
123
Fund Commentary | Nationwide HighMark Small Cap Core Fund |
124
Fund Commentary (cont.) | Nationwide HighMark Small Cap Core Fund |
125
Fund Overview | Nationwide HighMark Small Cap Core Fund |
| Percentages indicated are based upon net assets as of July 31, 2014. |
| Percentages indicated are based upon total investments as of July 31, 2014. |
126
Fund Performance | Nationwide HighMark Small Cap Core Fund |
127
Fund Performance (cont.) | Nationwide HighMark Small Cap Core Fund |
Performance of a $10,000 Investment
Investment return and principal value will fluctuate, and when redeemed, shares may be worth more or less than original cost. Past performance is no guarantee of future results and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Investing in mutual funds involves market risk, including loss of principal. Performance returns assume the reinvestment of all distributions.
Comparative performance of $10,000 invested in Institutional Service Class shares of the Nationwide HighMark Small Cap Core Fund since inception* through 7/31/14 versus the Russell 2000® Index and the Consumer Price Index (CPI) for the same period. Unlike the Fund, the performance for these unmanaged indexes does not reflect any fees, expenses, or sales charges. One cannot invest directly in a market index. A description of the benchmarks can be found on the Market Index Definitions page at the back of this book.
*The inception date for the Nationwide HighMark Small Cap Core Fund is 9/16/13. Performance prior to that date is based on the since-inception performance of the Funds predecessor fund.
128
Shareholder Expense Example | Nationwide HighMark Small Cap Core Fund |
Schedule of Shareholder Expenses
Expense Analysis of a $1,000 Investment
Nationwide HighMark Small Cap July 31, 2014 |
Beginning Account Value ($) |
Ending 07/31/14 |
Expenses Paid During Period ($) 02/01/14 - 07/31/14 |
Expense Ratio During Period (%) 02/01/14 - 07/31/14 | ||||||||
Class A Shares | Actual | (a) | 1,000.00 | 1,030.10 | 7.85 | 1.56 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,017.06 | 7.80 | 1.56 | |||||||
Class C Shares | Actual | (a) | 1,000.00 | 1,026.80 | 11.16 | 2.22 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,013.79 | 11.08 | 2.22 | |||||||
Institutional Service Class Shares(c) | Actual | (a) | 1,000.00 | 1,031.50 | 6.50 | 1.29 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,018.40 | 6.46 | 1.29 | |||||||
Institutional Class Shares | Actual | (a) | 1,000.00 | 1,031.80 | 6.15 | 1.22 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,018.74 | 6.11 | 1.22 |
(a) | Expenses are equal to the Funds annualized expense ratio multiplied by the average account value from February 1, 2014 through July 31, 2014 multiplied to reflect one-half year period. The expense ratio presented represents a six-month, annualized ratio in accordance with Securities and Exchange Commission guidelines. |
(b) | Represents the hypothetical 5% return before expenses. |
(c) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
129
Statement of Investments
July 31, 2014
Nationwide HighMark Small Cap Core Fund
130
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Small Cap Core Fund (Continued)
131
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Small Cap Core Fund (Continued)
132
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Small Cap Core Fund (Continued)
At July 31, 2014, the Funds open futures contracts were as follows (Note 2):
Number of Contracts |
Long Contracts | Expiration | Notional Value Covered by Contracts |
Unrealized Appreciation/ (Depreciation) |
||||||||||
21 | Russell 2000 Mini Future | 09/19/14 | $ | 2,345,070 | $ | (101,148 | ) | |||||||
|
|
|
|
The accompanying notes are an integral part of these financial statements.
133
Statement of Assets and Liabilities
July 31, 2014
Nationwide Small Cap Core Fund | ||||||
Assets: |
||||||
Investments, at value (cost $66,174,419) |
$ | 82,782,340 | ||||
Cash |
2,468,463 | |||||
Dividends receivable |
24,511 | |||||
Receivable for investments sold |
5,649,628 | |||||
Receivable for capital shares issued |
57,487 | |||||
Receivable for variation margin on futures contracts |
68,770 | |||||
Prepaid expenses |
11,748 | |||||
|
|
|||||
Total Assets |
91,062,947 | |||||
|
|
|||||
Liabilities: |
||||||
Payable for investments purchased |
5,835,786 | |||||
Payable for capital shares redeemed |
48,089 | |||||
Accrued expenses and other payables: |
||||||
Investment advisory fees |
70,629 | |||||
Fund administration fees |
8,993 | |||||
Distribution fees |
6,083 | |||||
Administrative servicing fees |
33,428 | |||||
Accounting and transfer agent fees |
2,653 | |||||
Trustee fees |
206 | |||||
Custodian fees |
329 | |||||
Compliance program costs (Note 3) |
793 | |||||
Professional fees |
23,113 | |||||
Printing fees |
4,179 | |||||
Other |
3,540 | |||||
|
|
|||||
Total Liabilities |
6,037,821 | |||||
|
|
|||||
Net Assets |
$ | 85,025,126 | ||||
|
|
|||||
Represented by: |
||||||
Capital |
$ | 84,230,548 | ||||
Accumulated distributions in excess of net investment loss |
(247,837 | ) | ||||
Accumulated net realized losses from investments and futures transactions |
(15,464,358 | ) | ||||
Net unrealized appreciation/(depreciation) from investments |
16,607,921 | |||||
Net unrealized appreciation/(depreciation) from futures contracts (Note 2) |
(101,148 | ) | ||||
|
|
|||||
Net Assets |
$ | 85,025,126 | ||||
|
|
|||||
Net Assets: |
||||||
Class A Shares |
$ | 11,588,588 | ||||
Class C Shares |
4,030,378 | |||||
Institutional Service Class Shares |
69,395,173 | |||||
Institutional Class Shares |
10,987 | |||||
|
|
|||||
Total |
$ | 85,025,126 | ||||
|
|
|||||
Shares Outstanding (unlimited number of shares authorized): |
||||||
Class A Shares |
408,615 | |||||
Class C Shares |
148,184 | |||||
Institutional Service Class Shares |
2,408,432 | |||||
Institutional Class Shares |
381 | |||||
|
|
|||||
Total |
2,965,612 | |||||
|
|
|||||
134
Statement of Assets and Liabilities (Continued)
July 31, 2014
Nationwide Small Cap Core Fund | ||||||
Net asset value and redemption price per share (Net assets by class divided by shares outstanding by class, respectively): |
||||||
Class A Shares (a) |
$ | 28.36 | ||||
Class C Shares (b) |
$ | 27.20 | ||||
Institutional Service Class Shares |
$ | 28.81 | ||||
Institutional Class Shares |
$ | 28.84 | ||||
Maximum offering price per share (100%/(100%-maximum sales charge) of net asset value adjusted to the nearest cent): |
||||||
Class A Shares |
$ | 30.09 | ||||
|
|
|||||
Maximum Sales Charge: |
||||||
Class A Shares |
5.75 | % | ||||
|
|
|||||
(a) | For Class A Shares, the redemption price per share is reduced by 1.00% on sales of shares of original purchases of $1,000,000 or more or that were not subject to a front-end sales charge made within 18 months of the purchase date. |
(b) | For Class C Shares, the redemption price per share is reduced by 1.00% for shares held less than one year. |
The accompanying notes are an integral part of these financial statements.
135
Statement of Operations
For the Year Ended July 31, 2014
Nationwide HighMark Small Cap Core Fund | ||||||
INVESTMENT INCOME: |
||||||
Dividend income |
$ | 719,750 | ||||
Interest income |
27 | |||||
Foreign tax withholding |
(1,418 | ) | ||||
|
|
|||||
Total Income |
718,359 | |||||
|
|
|||||
EXPENSES: |
||||||
Investment advisory fees |
757,315 | |||||
Fund administration fees |
117,150 | |||||
Distribution fees Class A |
29,408 | |||||
Distribution fees Class C |
43,122 | |||||
Administrative servicing fees Class A |
12,706 | |||||
Administrative servicing fees Class C |
1,166 | |||||
Administrative servicing fees Institutional Service Class (a) |
60,840 | |||||
Registration and filing fees |
44,634 | |||||
Professional fees |
33,609 | |||||
Printing fees |
14,940 | |||||
Trustee fees |
2,002 | |||||
Custodian fees |
3,151 | |||||
Accounting and transfer agent fees |
14,377 | |||||
Compliance program costs (Note 3) |
1,420 | |||||
Other |
12,649 | |||||
|
|
|||||
Total expenses before earnings credit, fees waived, and expenses reimbursed |
1,148,489 | |||||
|
|
|||||
Earnings credit (Note 5) |
(45 | ) | ||||
Administrative servicing fees voluntarily waived Class A (Note 3) |
(1,426 | ) | ||||
Administrative servicing fees voluntarily waived Institutional Service Class (Note 3) (a) |
(7,145 | ) | ||||
Expenses reimbursed by adviser (Note 3) |
(11,750 | ) | ||||
|
|
|||||
Net Expenses |
1,128,123 | |||||
|
|
|||||
NET INVESTMENT LOSS |
(409,764 | ) | ||||
|
|
|||||
REALIZED/UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: |
||||||
Net realized gains from investment transactions |
8,550,857 | |||||
Net realized gains from futures transactions (Note 2) |
377,591 | |||||
|
|
|||||
Net realized gains from investments and futures transactions |
8,928,448 | |||||
|
|
|||||
Net change in unrealized appreciation/(depreciation) from investments |
1,270,806 | |||||
Net change in unrealized appreciation/(depreciation) from futures contracts (Note 2) |
(116,978 | ) | ||||
|
|
|||||
Net change in unrealized appreciation/(depreciation) from investments and futures contracts |
1,153,828 | |||||
|
|
|||||
Net realized/unrealized gains from investments and futures transactions |
10,082,276 | |||||
|
|
|||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS |
$ | 9,672,512 | ||||
|
|
|||||
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
The accompanying notes are an integral part of these financial statements.
136
Statements of Changes in Net Assets
Nationwide HighMark Small Cap Core Fund | ||||||||||||
Year Ended July 31, 2014 |
Year
Ended July 31, 2013 | |||||||||||
Operations: |
||||||||||||
Net investment loss |
$ | (409,764 | ) | $ | (20,351 | ) | ||||||
Net realized gains from investments and futures transactions |
8,928,448 | 12,871,094 | ||||||||||
Net change in unrealized appreciation/(depreciation) from investments and futures contracts |
1,153,828 | 8,055,058 | ||||||||||
|
|
|
|
|||||||||
Change in net assets resulting from operations |
9,672,512 | 20,905,801 | ||||||||||
|
|
|
|
|||||||||
Distributions to Shareholders From: |
||||||||||||
Net investment income: |
||||||||||||
Class A |
| | ||||||||||
Class C |
| | ||||||||||
Institutional Service Class (a) |
| (18,837 | ) | |||||||||
Institutional Class |
| (b) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from shareholder distributions |
| (18,837 | ) | |||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
1,509,324 | (8,116,338 | ) | |||||||||
|
|
|
|
|||||||||
Change in net assets |
11,181,836 | 12,770,626 | ||||||||||
|
|
|
|
|||||||||
Net Assets: |
||||||||||||
Beginning of year |
73,843,290 | 61,072,664 | ||||||||||
|
|
|
|
|||||||||
End of year |
$ | 85,025,126 | $ | 73,843,290 | ||||||||
|
|
|
|
|||||||||
Accumulated distributions in excess of net investment income at end of year |
$ | (247,837 | ) | $ | (17,330 | ) | ||||||
|
|
|
|
|||||||||
CAPITAL TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
$ | 486,019 | $ | 630,988 | (c) | |||||||
Dividends reinvested |
| | ||||||||||
Cost of shares redeemed |
(1,911,642 | ) | (2,928,406 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
(1,425,623 | ) | (2,297,418 | ) | ||||||||
|
|
|
|
|||||||||
Class C Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
90,409 | 364,794 | (c) | |||||||||
Dividends reinvested |
| | ||||||||||
Cost of shares redeemed |
(969,627 | ) | (858,039 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
(879,218 | ) | (493,245 | ) | ||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 12)(a) |
||||||||||||
Proceeds from shares issued |
17,436,398 | 23,986,569 | (c) | |||||||||
Dividends reinvested |
| 9,042 | ||||||||||
Cost of shares redeemed |
(13,632,233 | ) | (29,321,286 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
3,804,165 | (5,325,675 | ) | |||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Proceeds from shares issued |
10,000 | (b) | | |||||||||
Dividends reinvested |
| (b) | | |||||||||
Cost of shares redeemed |
| (b) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
10,000 | (b) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
$ | 1,509,324 | $ | (8,116,338 | ) | |||||||
|
|
|
|
|||||||||
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(b) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
(c) | Includes redemption fees. See Note 4 for further information. |
137
Statements of Changes in Net Assets (Continued)
Nationwide HighMark Small Cap Core Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
SHARE TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Issued |
17,493 | 28,038 | ||||||||||
Reinvested |
| | ||||||||||
Redeemed |
(70,553 | ) | (138,488 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
(53,060 | ) | (110,450 | ) | ||||||||
|
|
|
|
|||||||||
Class C Shares (Note 12) |
||||||||||||
Issued |
3,428 | 17,247 | ||||||||||
Reinvested |
| | ||||||||||
Redeemed |
(37,315 | ) | (41,869 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
(33,887 | ) | (24,622 | ) | ||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 12)(a) |
||||||||||||
Issued |
623,840 | 1,145,861 | ||||||||||
Reinvested |
| 447 | ||||||||||
Redeemed |
(499,452 | ) | (1,277,868 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
124,388 | (131,560 | ) | |||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Issued |
381 | (b) | | |||||||||
Reinvested |
| (b) | | |||||||||
Redeemed |
| (b) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
381 | (b) | | |||||||||
|
|
|
|
|||||||||
Total change in shares |
37,822 | (266,632 | ) | |||||||||
|
|
|
|
|||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(b) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
138
Financial Highlights
Selected data for each share of capital outstanding throughout the periods indicated
Nationwide HighMark Small Cap Core Fund
Operations | Distributions | Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period |
Net Investment Income (Loss) |
Net Realized and Unrealized Gains (Losses) from Investments |
Total from Operations |
Net Investment Income |
Total Distributions |
Redemption Fees |
Net Asset Value, End of Period |
Total Return (a)(b)(c) |
Net Assets at End of Period |
Ratio of Expenses to Average Net Assets (d) |
Ratio of Net Investment Income (Loss) to Average Net Assets (d) |
Ratio of Expenses (Prior to Reimbursements) to Average Net Assets (d)(e) |
Portfolio Turnover (f) |
|||||||||||||||||||||||||||||||||||||||||||
Class A Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 25.02 | (0.19 | ) | 3.53 | 3.34 | | | | $ | 28.36 | 13.35% | (h) | $ | 11,588,588 | 1.59% | (0.69% | ) | 1.62% | 49.64% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 19.00 | (0.05 | ) | 6.07 | 6.02 | | | | $ | 25.02 | 31.69% | $ | 11,549,088 | 1.62% | (0.22% | ) | 1.80% | 77.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 19.09 | (0.05 | ) | (0.04 | ) | (0.09 | ) | | | | $ | 19.00 | (0.52% | ) | $ | 10,869,386 | 1.62% | (0.27% | ) | 1.96% | 106.00% | (i) | |||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 14.47 | (0.11 | ) | 4.73 | 4.62 | | | | $ | 19.09 | 32.00% | $ | 536,163 | 1.62% | (0.62% | ) | 2.01% | 67.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 11.80 | (0.08 | ) | 2.78 | 2.70 | (0.03 | ) | (0.03 | ) | | $ | 14.47 | 22.86% | $ | 309,823 | 1.60% | (0.61% | ) | 2.04% | 78.00% | |||||||||||||||||||||||||||||||||||
Class C Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 24.14 | (0.35 | ) | 3.41 | 3.06 | | | | $ | 27.20 | 12.68% | (h) | $ | 4,030,378 | 2.22% | (1.32% | ) | 2.29% | 49.64% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 18.45 | (0.17 | ) | 5.86 | 5.69 | | | | $ | 24.14 | 30.84% | $ | 4,395,523 | 2.22% | (0.82% | ) | 2.30% | 77.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 18.65 | (0.16 | ) | (0.04 | ) | (0.20 | ) | | | | $ | 18.45 | (1.07% | ) | $ | 3,812,858 | 2.22% | (0.87% | ) | 2.46% | 106.00% | (i) | |||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 14.22 | (0.22 | ) | 4.65 | 4.43 | | | | $ | 18.65 | 31.15% | $ | 216,583 | 2.22% | (1.22% | ) | 2.51% | 67.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 11.65 | (0.16 | ) | 2.73 | 2.57 | | | | $ | 14.22 | 22.17% | $ | 77,175 | 2.20% | (1.21% | ) | 2.54% | 78.00% | |||||||||||||||||||||||||||||||||||||
Institutional Service Class Shares (j) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 25.35 | (0.12 | ) | 3.58 | 3.46 | | | | $ | 28.81 | 13.65% | (h) | $ | 69,395,173 | 1.33% | (0.43% | ) | 1.35% | 49.64% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 19.20 | 0.01 | 6.15 | 6.16 | (0.01 | ) | (0.01 | ) | | $ | 25.35 | 32.07% | $ | 57,898,679 | 1.34% | 0.06% | 1.56% | 77.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 19.24 | 0.01 | (0.05 | ) | (0.04 | ) | | | | $ | 19.20 | (0.21% | ) | $ | 46,390,420 | 1.33% | 0.03% | 1.71% | 106.00% | (i) | |||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 14.54 | (0.06 | ) | 4.76 | 4.70 | | | | $ | 19.24 | 32.33% | $ | 27,136,559 | 1.31% | (0.31% | ) | 1.76% | 67.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 11.85 | (0.04 | ) | 2.79 | 2.75 | (0.06 | ) | (0.06 | ) | | $ | 14.54 | 23.32% | $ | 23,527,050 | 1.30% | (0.30% | ) | 1.79% | 78.00% | |||||||||||||||||||||||||||||||||||
Institutional Class Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Period Ended July 31, 2014 (g)(k) |
$ | 26.26 | (0.08 | ) | 2.66 | 2.58 | | | | $ | 28.84 | 9.82% | (h) | $ | 10,987 | 1.22% | (0.34% | ) | 1.25% | 49.64% | ||||||||||||||||||||||||||||||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Excludes sales charge. |
(b) | Not annualized for periods less than one year. |
(c) | Total returns prior to the Funds inception on September 16, 2013 are based on the performance of the Funds predecessor fund. |
(d) | Annualized for periods less than one year. |
(e) | During the period, certain fees may have been waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(f) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(g) | Per share calculations were performed using average shares method. |
(h) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset values for financial reporting purposes and the returns based upon those net asset values may differ from the net asset values and returns for shareholder transactions. |
(i) | Excludes merger activity. |
(j) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(k) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. Total return is calculated based on inception date of September 18, 2013 through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
139
Fund Commentary | Nationwide HighMark Value Fund |
140
Fund Commentary (cont.) | Nationwide HighMark Value Fund |
141
Fund Overview | Nationwide HighMark Value Fund |
| Percentages indicated are based upon net assets as of July 31, 2014. |
| Amount rounds to less than 0.1%. |
| Percentages indicated are based upon total investments as of July 31, 2014. |
* | For purposes of listing top industries and top holdings, the repurchase agreement is included as part of Other. |
142
Fund Performance | Nationwide HighMark Value Fund |
143
Fund Performance (cont.) | Nationwide HighMark Value Fund |
Performance of a $10,000 Investment
Investment return and principal value will fluctuate, and when redeemed, shares may be worth more or less than original cost. Past performance is no guarantee of future results and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Investing in mutual funds involves market risk, including loss of principal. Performance returns assume the reinvestment of all distributions.
Comparative performance of $10,000 invested in Institutional Service Class shares of the Nationwide HighMark Value Fund versus the S&P 500® Index, the Russell 1000® Value Index and the Consumer Price Index (CPI) over the 10-year period ended 7/31/14. Fund performance prior to the Funds inception on 9/16/13 is based on the Funds predecessor fund. Unlike the Fund, the performance for these unmanaged indexes does not reflect any fees, expenses, or sales charges. One cannot invest directly in a market index. A description of the benchmarks can be found on the Market Index Definitions page at the back of this book.
144
Shareholder Expense Example | Nationwide HighMark Value Fund |
Schedule of Shareholder Expenses
Expense Analysis of a $1,000 Investment
Nationwide HighMark Value Fund July 31, 2014 |
Beginning Account Value ($) 02/01/14 |
Ending Account Value ($) 07/31/14 |
Expenses Paid During Period ($) 02/01/14 - 07/31/14 |
Expense Ratio During Period (%) 02/01/14 - 07/31/14 | ||||||||
Class A Shares | Actual | (a) | 1,000.00 | 1,080.30 | 5.21 | 1.01 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,019.79 | 5.06 | 1.01 | |||||||
Class C Shares | Actual | (a) | 1,000.00 | 1,075.90 | 9.11 | 1.77 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,016.02 | 8.85 | 1.77 | |||||||
Class U Shares | Actual | (a) | 1,000.00 | 1,081.90 | 3.72 | 0.72 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,021.22 | 3.61 | 0.72 | |||||||
Institutional Service Class Shares(c) | Actual | (a) | 1,000.00 | 1,082.00 | 3.97 | 0.77 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,020.98 | 3.86 | 0.77 | |||||||
Institutional Class Shares | Actual | (a) | 1,000.00 | 1,081.30 | 3.72 | 0.72 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,021.22 | 3.61 | 0.72 |
(a) | Expenses are equal to the Funds annualized expense ratio multiplied by the average account value from February 1, 2014 through July 31, 2014 multiplied to reflect one-half year period. The expense ratio presented represents a six-month, annualized ratio in accordance with Securities and Exchange Commission guidelines. |
(b) | Represents the hypothetical 5% return before expenses. |
(c) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
145
Statement of Investments
July 31, 2014
Nationwide HighMark Value Fund
146
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Value Fund (Continued)
147
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Value Fund (Continued)
The accompanying notes are an integral part of these financial statements.
148
Statement of Assets and Liabilities
July 31, 2014
Nationwide HighMark Value Fund | ||||||
Assets: |
||||||
Investments, at value* (cost $298,012,209) |
$ | 338,065,309 | ||||
Repurchase agreement, at value (cost $2,954,470) |
2,954,470 | |||||
|
|
|||||
Total Investments, at value (total cost $300,966,679) |
341,019,779 | |||||
|
|
|||||
Cash |
3,172,419 | |||||
Dividends receivable |
384,110 | |||||
Security lending income receivable |
1,429 | |||||
Receivable for investments sold |
4,276,375 | |||||
Receivable for capital shares issued |
50,524 | |||||
Reclaims receivable |
237,908 | |||||
Prepaid expenses |
10,628 | |||||
|
|
|||||
Total Assets |
349,153,172 | |||||
|
|
|||||
Liabilities: |
||||||
Payable for investments purchased |
4,265,496 | |||||
Payable for capital shares redeemed |
307,043 | |||||
Payable upon return of securities loaned (Note 2) |
3,274,400 | |||||
Accrued expenses and other payables: |
||||||
Investment advisory fees |
178,889 | |||||
Fund administration fees |
17,169 | |||||
Distribution fees |
22,028 | |||||
Administrative servicing fees |
116,369 | |||||
Accounting and transfer agent fees |
9,763 | |||||
Trustee fees |
780 | |||||
Custodian fees |
2,345 | |||||
Compliance program costs (Note 3) |
994 | |||||
Professional fees |
23,707 | |||||
Printing fees |
10,882 | |||||
Other |
3,436 | |||||
|
|
|||||
Total Liabilities |
8,233,301 | |||||
|
|
|||||
Net Assets |
$ | 340,919,871 | ||||
|
|
|||||
Represented by: |
||||||
Capital |
$ | 275,875,201 | ||||
Accumulated distributions in excess of net investment income |
(240,904 | ) | ||||
Accumulated net realized gains from investments and foreign currency transactions |
25,233,981 | |||||
Net unrealized appreciation/(depreciation) from investments |
40,053,100 | |||||
Net unrealized appreciation/(depreciation) from translation of assets and liabilities denominated in foreign currencies |
(1,507 | ) | ||||
|
|
|||||
Net Assets |
$ | 340,919,871 | ||||
|
|
|||||
Net Assets: |
||||||
Class A Shares |
$ | 86,074,940 | ||||
Class C Shares |
3,598,207 | |||||
Class U Shares |
134,180,244 | |||||
Institutional Service Class Shares |
117,053,763 | |||||
Institutional Class Shares |
12,717 | |||||
|
|
|||||
Total |
$ | 340,919,871 | ||||
|
|
|||||
* | Includes value of securities on loan of $3,205,638 (Note 2). |
149
Statement of Assets and Liabilities (Continued)
July 31, 2014
Nationwide HighMark Value Fund | ||||||
Shares Outstanding (unlimited number of shares authorized): |
||||||
Class A Shares |
5,245,075 | |||||
Class C Shares |
228,734 | |||||
Class U Shares |
8,127,735 | |||||
Institutional Service Class Shares |
7,096,227 | |||||
Institutional Class Shares |
771 | |||||
|
|
|||||
Total |
20,698,542 | |||||
|
|
|||||
Net asset value and redemption price per share (Net assets by class divided by shares outstanding by class, respectively): |
||||||
Class A Shares (a) |
$ | 16.41 | ||||
Class C Shares (b) |
$ | 15.73 | ||||
Class U Shares |
$ | 16.51 | ||||
Institutional Service Class Shares |
$ | 16.50 | ||||
Institutional Class Shares |
$ | 16.49 | ||||
Maximum offering price per share (100%/(100%-maximum sales charge) of net asset value adjusted to the nearest cent): |
||||||
Class A Shares |
$ | 17.41 | ||||
|
|
|||||
Maximum Sales Charge: |
||||||
Class A Shares |
5.75 | % | ||||
|
|
|||||
(a) | For Class A Shares, the redemption price per share is reduced by 1.00% on sales of shares of original purchases of $1,000,000 or more or that were not subject to a front-end sales charge made within 18 months of the purchase date. |
(b) | For Class C Shares, the redemption price per share is reduced by 1.00% for shares held less than one year. |
The accompanying notes are an integral part of these financial statements.
150
Statement of Operations
For the Year Ended July 31, 2014
Nationwide Value Fund | ||||||
INVESTMENT INCOME: |
||||||
Dividend income |
$ | 6,738,102 | ||||
Income from securities lending (Note 2) |
21,665 | |||||
Foreign tax withholding |
(73,300 | ) | ||||
|
|
|||||
Total Income |
6,686,467 | |||||
|
|
|||||
EXPENSES: |
||||||
Investment advisory fees |
2,078,278 | |||||
Fund administration fees |
268,339 | |||||
Distribution fees Class A |
222,678 | |||||
Distribution fees Class B (a) |
831 | |||||
Distribution fees Class C |
37,894 | |||||
Administrative servicing fees Class A |
132,247 | |||||
Administrative servicing fees Class B (a) |
277 | |||||
Administrative servicing fees Class C |
946 | |||||
Administrative servicing fees Institutional Service Class (b) |
188,477 | |||||
Registration and filing fees |
51,261 | |||||
Professional fees |
47,124 | |||||
Printing fees |
36,815 | |||||
Trustee fees |
8,123 | |||||
Custodian fees |
15,769 | |||||
Accounting and transfer agent fees |
55,968 | |||||
Compliance program costs (Note 3) |
1,957 | |||||
Other |
28,586 | |||||
|
|
|||||
Total expenses before earnings credit, fees waived, and expenses reimbursed |
3,175,570 | |||||
|
|
|||||
Earnings credit (Note 5) |
(121 | ) | ||||
Administrative servicing fees voluntarily waived Class A (Note 3) |
(11,137 | ) | ||||
Administrative servicing fees voluntarily waived Institutional Service Class (Note 3) (b) |
(16,216 | ) | ||||
Expenses reimbursed by adviser (Note 3) |
(18,823 | ) | ||||
|
|
|||||
Net Expenses |
3,129,273 | |||||
|
|
|||||
NET INVESTMENT INCOME |
3,557,194 | |||||
|
|
|||||
REALIZED/UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: |
||||||
Net realized gains from investment transactions |
51,700,042 | |||||
Net realized losses from foreign currency transactions (Note 2) |
(16,668 | ) | ||||
|
|
|||||
Net realized gains from investments and foreign currency transactions |
51,683,374 | |||||
|
|
|||||
Net change in unrealized appreciation/(depreciation) from investments |
(11,234,162 | ) | ||||
Net change in unrealized appreciation/(depreciation) from translation of assets and liabilities denominated in foreign currencies |
(4,715 | ) | ||||
|
|
|||||
Net change in unrealized appreciation/(depreciation) from investments and translation of assets and liabilities denominated in foreign currencies |
(11,238,877 | ) | ||||
|
|
|||||
Net realized/unrealized gains from investments, foreign currency transactions, and translation of assets and liabilities denominated in foreign currencies |
40,444,497 | |||||
|
|
|||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS |
$ | 44,001,691 | ||||
|
|
|||||
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
The accompanying notes are an integral part of these financial statements.
151
Statements of Changes in Net Assets
Nationwide HighMark Value Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
Operations: |
||||||||||||
Net investment income |
$ | 3,557,194 | $ | 4,221,800 | ||||||||
Net realized gains from investments and foreign currency transactions |
51,683,374 | 64,996,092 | ||||||||||
Net change in unrealized appreciation/(depreciation) from investments and translation of assets and liabilities denominated in foreign currencies |
(11,238,877 | ) | 15,236,336 | |||||||||
|
|
|
|
|||||||||
Change in net assets resulting from operations |
44,001,691 | 84,454,228 | ||||||||||
|
|
|
|
|||||||||
Distributions to Shareholders From: |
||||||||||||
Net investment income: |
||||||||||||
Class A |
(1,111,182 | ) | (868,709 | ) | ||||||||
Class B (a) |
| (4,739 | ) | |||||||||
Class C |
(38,056 | ) | (18,375 | ) | ||||||||
Class U |
(1,868,788 | ) | (1,503,776 | ) | ||||||||
Institutional Service Class (b) |
(1,607,865 | ) | (1,859,523 | ) | ||||||||
Institutional Class |
(172 | )(c) | | |||||||||
Net realized gains: |
||||||||||||
Class A |
(16,926,608 | ) | (6,894,754 | ) | ||||||||
Class B (a) |
| (82,018 | ) | |||||||||
Class C |
(739,307 | ) | (303,289 | ) | ||||||||
Class U |
(24,016,009 | ) | (8,404,072 | ) | ||||||||
Institutional Service Class (b) |
(22,294,154 | ) | (12,447,024 | ) | ||||||||
Institutional Class |
(2,209 | )(c) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from shareholder distributions |
(68,604,350 | ) | (32,386,279 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
16,457,627 | (38,328,884 | ) | |||||||||
|
|
|
|
|||||||||
Change in net assets |
(8,145,032 | ) | 13,739,065 | |||||||||
|
|
|
|
|||||||||
Net Assets: |
||||||||||||
Beginning of year |
349,064,903 | 335,325,838 | ||||||||||
|
|
|
|
|||||||||
End of year |
$ | 340,919,871 | $ | 349,064,903 | ||||||||
|
|
|
|
|||||||||
Accumulated distributions in excess of net investment income at end of year |
$ | (240,904 | ) | $ | | |||||||
|
|
|
|
|||||||||
CAPITAL TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
$ | 798,425 | $ | 1,347,842 | ||||||||
Proceeds from shares issued from class conversion |
822,072 | | ||||||||||
Dividends reinvested |
16,978,066 | 7,275,918 | ||||||||||
Cost of shares redeemed |
(14,951,547 | ) | (15,745,647 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
3,647,016 | (7,121,887 | ) | |||||||||
|
|
|
|
|||||||||
Class B Shares (Note 12)(a) |
||||||||||||
Proceeds from shares issued |
| | ||||||||||
Dividends reinvested |
| 83,105 | ||||||||||
Cost of shares redeemed in class conversion |
(822,072 | ) | | |||||||||
Cost of shares redeemed |
(91,813 | ) | (493,107 | ) | ||||||||
|
|
|
|
|||||||||
Total Class B Shares |
(913,885 | ) | (410,002 | ) | ||||||||
|
|
|
|
|||||||||
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(c) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
152
Statements of Changes in Net Assets (Continued)
Nationwide HighMark Value Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
CAPITAL TRANSACTIONS: (continued) |
||||||||||||
Class C Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
$ | 238,331 | $ | 187,337 | ||||||||
Dividends reinvested |
757,325 | 308,590 | ||||||||||
Cost of shares redeemed |
(935,072 | ) | (977,349 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
60,584 | (481,422 | ) | |||||||||
|
|
|
|
|||||||||
Class U Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
12,064,380 | 16,337,730 | ||||||||||
Dividends reinvested |
25,884,797 | 9,907,841 | ||||||||||
Cost of shares redeemed |
(18,564,191 | ) | (19,448,653 | ) | ||||||||
|
|
|
|
|||||||||
Total Class U Shares |
19,384,986 | 6,796,918 | ||||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 12)(b) |
||||||||||||
Proceeds from shares issued |
23,356,001 | 14,668,770 | ||||||||||
Dividends reinvested |
21,556,339 | 12,856,808 | ||||||||||
Cost of shares redeemed |
(50,647,347 | ) | (64,638,069 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
(5,735,007 | ) | (37,112,491 | ) | ||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Proceeds from shares issued |
11,552 | (c) | | |||||||||
Dividends reinvested |
2,381 | (c) | | |||||||||
Cost of shares redeemed |
| (c) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
13,933 | (c) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
$ | 16,457,627 | $ | (38,328,884 | ) | |||||||
|
|
|
|
|||||||||
SHARE TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Issued |
47,358 | 80,730 | ||||||||||
Issued in class conversion |
44,700 | | ||||||||||
Reinvested |
1,114,778 | 475,129 | ||||||||||
Redeemed |
(887,447 | ) | (947,843 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
319,389 | (391,984 | ) | |||||||||
|
|
|
|
|||||||||
Class B Shares (Note 12)(a) |
||||||||||||
Issued |
| | ||||||||||
Reinvested |
| 5,587 | ||||||||||
Redeemed in class conversion |
(45,886 | ) | | |||||||||
Redeemed |
(5,185 | ) | (30,498 | ) | ||||||||
|
|
|
|
|||||||||
Total Class B Shares |
(51,071 | ) | (24,911 | ) | ||||||||
|
|
|
|
|||||||||
Class C Shares (Note 12) |
||||||||||||
Issued |
13,993 | 11,314 | ||||||||||
Reinvested |
51,659 | 20,853 | ||||||||||
Redeemed |
(56,724 | ) | (61,093 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
8,928 | (28,926 | ) | |||||||||
|
|
|
|
|||||||||
Class U Shares (Note 12) |
||||||||||||
Issued |
719,034 | 980,824 | ||||||||||
Reinvested |
1,692,923 | 642,770 | ||||||||||
Redeemed |
(1,097,881 | ) | (1,167,646 | ) | ||||||||
|
|
|
|
|||||||||
Total Class U Shares |
1,314,076 | 455,948 | ||||||||||
|
|
|
|
|||||||||
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(c) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
153
Statements of Changes in Net Assets (Continued)
Nationwide HighMark Value Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
SHARE TRANSACTIONS: (continued) |
||||||||||||
Institutional Service Class Shares (Note 12)(b) |
||||||||||||
Issued |
1,440,596 | 887,082 | ||||||||||
Reinvested |
1,410,756 | 837,907 | ||||||||||
Redeemed |
(2,990,528 | ) | (3,850,323 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
(139,176 | ) | (2,125,334 | ) | ||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Issued |
615 | (c) | | |||||||||
Reinvested |
156 | (c) | | |||||||||
Redeemed |
| (c) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
771 | (c) | | |||||||||
|
|
|
|
|||||||||
Total change in shares |
1,452,917 | (2,115,207 | ) | |||||||||
|
|
|
|
|||||||||
Amounts designated as are zero or have been rounded to zero.
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(c) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
154
Financial Highlights
Selected data for each share of capital outstanding throughout the periods indicated
Nationwide HighMark Value Fund
Operations | Distributions | Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, |
Net Investment Income |
Net Realized and Unrealized Gains (Losses) from Investments |
Total from Operations |
Net Investment Income |
Net Realized Gains |
Total Distributions |
Net Asset
of Period |
Total Return (a)(b)(c) |
Net Assets at End of Period |
Ratio of Expenses to Average Net Assets (d) |
Ratio of Net Investment Income to Average Net Assets (d) |
Ratio of Expenses (Prior to Reimbursements) to Average Net Assets (d)(e) |
Portfolio Turnover (f) |
|||||||||||||||||||||||||||||||||||||||||||
Class A Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 18.10 | 0.14 | 2.00 | 2.14 | (0.24 | ) | (3.59 | ) | (3.83 | ) | $ | 16.41 | 13.45% | $ | 86,074,940 | 1.13% | 0.80% | 1.15% | 58.15% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 15.67 | 0.16 | 3.80 | 3.96 | (0.16 | ) | (1.37 | ) | (1.53 | ) | $ | 18.10 | 27.18% | $ | 89,153,591 | 1.25% | 0.98% | 1.36% | 55.00% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 16.05 | 0.18 | 0.27 | 0.45 | (0.18 | ) | (0.65 | ) | (0.83 | ) | $ | 15.67 | 3.28% | $ | 83,338,902 | 1.26% | 1.20% | 1.39% | 44.00% | (h) | |||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 13.61 | 0.15 | 2.57 | 2.72 | (0.28 | ) | | (0.28 | ) | $ | 16.05 | 20.12% | $ | 71,163,994 | 1.27% | 0.99% | 1.38% | 26.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 12.14 | 0.23 | 1.37 | 1.60 | (0.13 | ) | | (0.13 | ) | $ | 13.61 | 13.18% | $ | 72,131,888 | 1.25% | 1.70% | 1.36% | 12.00% | |||||||||||||||||||||||||||||||||||||
Class C Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 17.55 | 0.03 | 1.92 | 1.95 | (0.18 | ) | (3.59 | ) | (3.77 | ) | $ | 15.73 | 12.72% | $ | 3,598,207 | 1.77% | 0.16% | 1.77% | 58.15% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 15.25 | 0.06 | 3.69 | 3.75 | (0.08 | ) | (1.37 | ) | (1.45 | ) | $ | 17.55 | 26.37% | $ | 3,857,499 | 1.85% | 0.38% | 1.86% | 55.00% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 15.63 | 0.09 | 0.27 | 0.36 | (0.09 | ) | (0.65 | ) | (0.74 | ) | $ | 15.25 | 2.70% | $ | 3,792,235 | 1.86% | 0.60% | 1.89% | 44.00% | (h) | |||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 13.26 | 0.06 | 2.51 | 2.57 | (0.20 | ) | | (0.20 | ) | $ | 15.63 | 19.48% | $ | 2,503,285 | 1.87% | 0.39% | 1.88% | 26.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 11.84 | 0.15 | 1.32 | 1.47 | (0.05 | ) | | (0.05 | ) | $ | 13.26 | 12.50% | $ | 2,547,983 | 1.85% | 1.10% | 1.86% | 12.00% | |||||||||||||||||||||||||||||||||||||
Class U Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 18.17 | 0.20 | 2.01 | 2.21 | (0.28 | ) | (3.59 | ) | (3.87 | ) | $ | 16.51 | 13.87% | $ | 134,180,244 | 0.74% | 1.19% | 0.75% | 58.15% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 15.72 | 0.23 | 3.81 | 4.04 | (0.22 | ) | (1.37 | ) | (1.59 | ) | $ | 18.17 | 27.69% | $ | 123,771,869 | 0.85% | 1.38% | 0.86% | 55.00% | ||||||||||||||||||||||||||||||||||||
Period Ended July 31, 2012 (g)(i) |
$ | 14.85 | 0.14 | 0.85 | 0.99 | (0.12 | ) | | (0.12 | ) | $ | 15.72 | 6.70% | $ | 99,929,775 | 0.86% | 1.60% | 0.89% | 44.00% | (h) | ||||||||||||||||||||||||||||||||||||
Institutional Service Class Shares (j) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 18.16 | 0.18 | 2.01 | 2.19 | (0.26 | ) | (3.59 | ) | (3.85 | ) | $ | 16.50 | 13.76% | $ | 117,053,763 | 0.88% | 1.04% | 0.90% | 58.15% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 15.71 | 0.21 | 3.81 | 4.02 | (0.20 | ) | (1.37 | ) | (1.57 | ) | $ | 18.16 | 27.54% | $ | 131,380,766 | 0.99% | 1.24% | 1.11% | 55.00% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 16.09 | 0.22 | 0.27 | 0.49 | (0.22 | ) | (0.65 | ) | (0.87 | ) | $ | 15.71 | 3.50% | $ | 147,100,903 | 1.00% | 1.46% | 1.14% | 44.00% | (h) | |||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 13.64 | 0.19 | 2.57 | 2.76 | (0.31 | ) | | (0.31 | ) | $ | 16.09 | 20.50% | $ | 234,784,893 | 1.02% | 1.24% | 1.13% | 26.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 12.17 | 0.26 | 1.37 | 1.63 | (0.16 | ) | | (0.16 | ) | $ | 13.64 | 13.43% | $ | 228,162,137 | 1.00% | 1.95% | 1.11% | 12.00% | |||||||||||||||||||||||||||||||||||||
Institutional Class Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Period Ended July 31, 2014 (g)(k) |
$ | 18.83 | 0.17 | 1.36 | 1.53 | (0.28 | ) | (3.59 | ) | (3.87 | ) | $ | 16.49 | 9.77% | $ | 12,717 | 0.73% | 1.20% | 0.73% | 58.15% | ||||||||||||||||||||||||||||||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Excludes sales charge. |
(b) | Not annualized for periods less than one year. |
(c) | Total returns prior to the Funds inception on September 16, 2013 are based on the performance of the Funds predecessor fund. |
(d) | Annualized for periods less than one year. |
(e) | During the period, certain fees may have been waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(f) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(g) | Per share calculations were performed using average shares method. |
(h) | Excludes merger activity. |
(i) | For the period from January 4, 2012 (commencement of operations) through July 31, 2012. |
(j) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(k) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. Total return is calculated based on inception date of September 18, 2013 through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
155
Fund Commentary | Nationwide Ziegler Equity Income Fund |
156
Fund Commentary (cont.) | Nationwide Ziegler Equity Income Fund |
157
Fund Overview | Nationwide Ziegler Equity Income Fund |
| Percentages indicated are based upon net assets as of July 31, 2014. |
| Percentages indicated are based upon total investments as of July 31, 2014. |
158
Fund Performance | Nationwide Ziegler Equity Income Fund |
159
Fund Performance (cont.) | Nationwide Ziegler Equity Income Fund |
Performance of a $10,000 Investment
Investment return and principal value will fluctuate, and when redeemed, shares may be worth more or less than original cost. Past performance is no guarantee of future results and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Investing in mutual funds involves market risk, including loss of principal. Performance returns assume the reinvestment of all distributions.
Comparative performance of $10,000 invested in Class A shares of the Nationwide Ziegler Equity Income Fund since inception* through 7/31/14 versus the Russell 1000® Value Index and the Consumer Price Index (CPI) for the same period. Unlike the Fund, the performance for these unmanaged indexes does not reflect any fees, expenses, or sales charges. One cannot invest directly in a market index. A description of the benchmarks can be found on the Market Index Definitions page at the back of this book.
*The inception date for the Nationwide Ziegler Equity Income Fund is 9/16/13. Performance prior to that date is based on the since-inception performance of the Funds predecessor fund.
160
Shareholder Expense Example | Nationwide Ziegler Equity Income Fund |
Schedule of Shareholder Expenses
Expense Analysis of a $1,000 Investment
Nationwide Ziegler Equity Income July 31, 2014 |
Beginning Account Value ($) 02/01/14 |
Ending Account Value ($) 07/31/14 |
Expenses Paid During Period ($) 02/01/14 - 07/31/14 |
Expense Ratio During Period (%) 02/01/14 - 07/31/14 | ||||||||
Class A Shares | Actual | (a) | 1,000.00 | 1,087.00 | 5.07 | 0.98 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,019.93 | 4.91 | 0.98 | ||||||||
Class C Shares | Actual | (a) | 1,000.00 | 1,084.00 | 9.04 | 1.75 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,016.12 | 8.75 | 1.75 | ||||||||
Institutional Service Class Shares(c) | Actual | (a) | 1,000.00 | 1,088.40 | 4.35 | 0.84 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,020.63 | 4.21 | 0.84 | ||||||||
Institutional Class Shares | Actual | (a) | 1,000.00 | 1,089.30 | 3.32 | 0.64 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,021.62 | 3.21 | 0.64 |
(a) | Expenses are equal to the Funds annualized expense ratio multiplied by the average account value from February 1, 2014 through July 31, 2014 multiplied to reflect one-half year period. The expense ratio presented represents a six-month, annualized ratio in accordance with Securities and Exchange Commission guidelines. |
(b) | Represents the hypothetical 5% return before expenses. |
(c) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
161
Statement of Investments
July 31, 2014
Nationwide Ziegler Equity Income Fund
162
Statement of Investments (Continued)
July 31, 2014
Nationwide Ziegler Equity Income Fund (Continued)
The accompanying notes are an integral part of these financial statements.
163
Statement of Assets and Liabilities
July 31, 2014
Nationwide Ziegler Equity Income Fund | ||||||
Assets: |
||||||
Investments, at value (cost $326,981,890) |
$ | 347,442,709 | ||||
Cash |
1,812,794 | |||||
Dividends receivable |
634,468 | |||||
Receivable for capital shares issued |
138,333 | |||||
Prepaid expenses |
12,107 | |||||
|
|
|||||
Total Assets |
350,040,411 | |||||
|
|
|||||
Liabilities: |
||||||
Payable for capital shares redeemed |
160,488 | |||||
Accrued expenses and other payables: |
||||||
Investment advisory fees |
156,406 | |||||
Fund administration fees |
14,112 | |||||
Distribution fees |
10,532 | |||||
Administrative servicing fees |
4,872 | |||||
Accounting and transfer agent fees |
1,934 | |||||
Trustee fees |
789 | |||||
Custodian fees |
2,010 | |||||
Compliance program costs (Note 3) |
373 | |||||
Professional fees |
21,808 | |||||
Printing fees |
3,547 | |||||
Other |
4,100 | |||||
|
|
|||||
Total Liabilities |
380,971 | |||||
|
|
|||||
Net Assets |
$ | 349,659,440 | ||||
|
|
|||||
Represented by: |
||||||
Capital |
$ | 328,750,436 | ||||
Accumulated undistributed net investment income |
1,116,057 | |||||
Accumulated net realized losses from investments |
(667,872 | ) | ||||
Net unrealized appreciation/(depreciation) from investments |
20,460,819 | |||||
|
|
|||||
Net Assets |
$ | 349,659,440 | ||||
|
|
|||||
Net Assets: |
||||||
Class A Shares |
$ | 24,092,166 | ||||
Class C Shares |
6,126,678 | |||||
Institutional Service Class Shares |
10,198,392 | |||||
Institutional Class Shares |
309,242,204 | |||||
|
|
|||||
Total |
$ | 349,659,440 | ||||
|
|
|||||
Shares Outstanding (unlimited number of shares authorized): |
||||||
Class A Shares |
1,801,569 | |||||
Class C Shares |
461,133 | |||||
Institutional Service Class Shares |
760,143 | |||||
Institutional Class Shares |
23,045,780 | |||||
|
|
|||||
Total |
26,068,625 | |||||
|
|
|||||
164
Statement of Assets and Liabilities (Continued)
July 31, 2014
Nationwide Ziegler Equity Income Fund | ||||||
Net asset value and redemption price per share (Net assets by class divided by shares outstanding by class, respectively): |
||||||
Class A Shares (a) |
$ | 13.37 | ||||
Class C Shares (b) |
$ | 13.29 | ||||
Institutional Service Class Shares |
$ | 13.42 | ||||
Institutional Class Shares |
$ | 13.42 | ||||
Maximum offering price per share (100%/(100%-maximum sales charge) of net asset value adjusted to the nearest cent): |
||||||
Class A Shares |
$ | 14.19 | ||||
|
|
|||||
Maximum Sales Charge: |
||||||
Class A Shares |
5.75 | % | ||||
|
|
|||||
(a) | For Class A Shares, the redemption price per share is reduced by 1.00% on sales of shares of original purchases of $1,000,000 or more or that were not subject to a front-end sales charge made within 18 months of the purchase date. |
(b) | For Class C Shares, the redemption price per share is reduced by 1.00% for shares held less than one year. |
The accompanying notes are an integral part of these financial statements.
165
Statement of Operations
For the Year Ended July 31, 2014
Nationwide Ziegler Equity Income Fund | ||||||
INVESTMENT INCOME: |
||||||
Dividend income |
$ | 5,080,220 | ||||
Foreign tax withholding |
(2,730 | ) | ||||
|
|
|||||
Total Income |
5,077,490 | |||||
|
|
|||||
EXPENSES: |
||||||
Investment advisory fees |
888,263 | |||||
Fund administration fees |
131,315 | |||||
Distribution fees Class A |
56,379 | |||||
Distribution fees Class B (a) |
1,001 | |||||
Distribution fees Class C |
54,282 | |||||
Administrative servicing fees Class A |
22,016 | |||||
Administrative servicing fees Class B (a) |
334 | |||||
Administrative servicing fees Class C |
1,420 | |||||
Administrative servicing fees Institutional Service Class (b) |
13,730 | |||||
Registration and filing fees |
54,384 | |||||
Professional fees |
38,111 | |||||
Printing fees |
13,684 | |||||
Trustee fees |
4,978 | |||||
Custodian fees |
7,357 | |||||
Accounting and transfer agent fees |
12,411 | |||||
Compliance program costs (Note 3) |
1,544 | |||||
Other |
11,743 | |||||
|
|
|||||
Total expenses before earnings credit, fees waived, and expenses reimbursed |
1,312,952 | |||||
|
|
|||||
Earnings credit (Note 5) |
(60 | ) | ||||
Administrative servicing fees voluntarily waived Class A (Note 3) |
(2,395 | ) | ||||
Administrative servicing fees voluntarily waived Institutional Service Class (Note 3) (b) |
(1,063 | ) | ||||
Expenses reimbursed by adviser (Note 3) |
(18,152 | ) | ||||
|
|
|||||
Net Expenses |
1,291,282 | |||||
|
|
|||||
NET INVESTMENT INCOME |
3,786,208 | |||||
|
|
|||||
REALIZED/UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: |
||||||
Net realized gains from investment transactions |
4,918,720 | |||||
Net change in unrealized appreciation/(depreciation) from investments |
13,248,057 | |||||
|
|
|||||
Net realized/unrealized gains from investments |
18,166,777 | |||||
|
|
|||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS |
$ | 21,952,985 | ||||
|
|
|||||
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares.
The accompanying notes are an integral part of these financial statements.
166
Statements of Changes in Net Assets
Nationwide Ziegler Equity Income Fund | ||||||||||||
Year Ended July 31, 2014 |
Year
Ended July 31, 2013 | |||||||||||
Operations: |
||||||||||||
Net investment income |
$ | 3,786,208 | $ | 560,037 | ||||||||
Net realized gains from investments |
4,918,720 | 1,256,886 | ||||||||||
Net change in unrealized appreciation/(depreciation) from investments |
13,248,057 | 3,250,723 | ||||||||||
|
|
|
|
|||||||||
Change in net assets resulting from operations |
21,952,985 | 5,067,646 | ||||||||||
|
|
|
|
|||||||||
Distributions to Shareholders From: |
||||||||||||
Net investment income: |
||||||||||||
Class A |
(279,175 | ) | (328,753 | ) | ||||||||
Class B (a) |
| (20,580 | ) | |||||||||
Class C |
(34,306 | ) | (54,983 | ) | ||||||||
Institutional Service Class (b) |
(124,486 | ) | (188,098 | ) | ||||||||
Institutional Class |
(2,255,227 | )(c) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from shareholder distributions |
(2,693,194 | ) | (592,414 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
296,862,982 | 6,814,801 | ||||||||||
|
|
|
|
|||||||||
Change in net assets |
316,122,773 | 11,290,033 | ||||||||||
|
|
|
|
|||||||||
Net Assets: |
||||||||||||
Beginning of year |
33,536,667 | 22,246,634 | ||||||||||
|
|
|
|
|||||||||
End of year |
$ | 349,659,440 | $ | 33,536,667 | ||||||||
|
|
|
|
|||||||||
Accumulated undistributed net investment income at end of year |
$ | 1,116,057 | $ | 28,689 | ||||||||
|
|
|
|
|||||||||
CAPITAL TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
$ | 6,141,187 | $ | 7,541,853 | ||||||||
Proceeds from shares issued from class conversion |
1,017,949 | | ||||||||||
Dividends reinvested |
234,541 | 275,320 | ||||||||||
Cost of shares redeemed |
(4,989,893 | ) | (2,591,284 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
2,403,784 | 5,225,889 | ||||||||||
|
|
|
|
|||||||||
Class B Shares (Note 12)(a) |
||||||||||||
Proceeds from shares issued |
| 20,609 | ||||||||||
Dividends reinvested |
| 19,786 | ||||||||||
Cost of shares redeemed in class conversion |
(1,017,949 | ) | | |||||||||
Cost of shares redeemed |
(79,683 | ) | (398,226 | ) | ||||||||
|
|
|
|
|||||||||
Total Class B Shares |
(1,097,632 | ) | (357,831 | ) | ||||||||
|
|
|
|
|||||||||
Class C Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
1,980,691 | 1,818,705 | ||||||||||
Dividends reinvested |
31,563 | 47,853 | ||||||||||
Cost of shares redeemed |
(984,062 | ) | (568,401 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
1,028,192 | 1,298,157 | ||||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 12)(b) |
||||||||||||
Proceeds from shares issued |
2,749,801 | 2,075,494 | ||||||||||
Dividends reinvested |
103,574 | 157,453 | ||||||||||
Cost of shares redeemed |
(2,284,497 | ) | (1,584,361 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
568,878 | 648,586 | ||||||||||
|
|
|
|
|||||||||
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares.
(c) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
167
Statements of Changes in Net Assets (Continued)
Nationwide Ziegler Equity Income Fund | ||||||||||||
Year Ended July 31, 2014 |
Year
Ended July 31, 2013 | |||||||||||
CAPITAL TRANSACTIONS: (continued) |
||||||||||||
Institutional Class Shares |
||||||||||||
Proceeds from shares issued |
$ | 297,702,325 | (c) | $ | | |||||||
Dividends reinvested |
2,255,227 | (c) | | |||||||||
Cost of shares redeemed |
(5,997,792 | )(c) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
293,959,760 | (c) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
$ | 296,862,982 | $ | 6,814,801 | ||||||||
|
|
|
|
|||||||||
SHARE TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Issued |
481,875 | 675,181 | ||||||||||
Issued in class conversion |
86,098 | | ||||||||||
Reinvested |
18,381 | 25,768 | ||||||||||
Redeemed |
(385,630 | ) | (237,901 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
200,724 | 463,048 | ||||||||||
|
|
|
|
|||||||||
Class B Shares (Note 12)(a) |
||||||||||||
Issued |
| 1,935 | ||||||||||
Reinvested |
| 1,867 | ||||||||||
Redeemed in class conversion |
(85,852 | ) | | |||||||||
Redeemed |
(6,754 | ) | (37,017 | ) | ||||||||
|
|
|
|
|||||||||
Total Class B Shares |
(92,606 | ) | (33,215 | ) | ||||||||
|
|
|
|
|||||||||
Class C Shares (Note 12) |
||||||||||||
Issued |
158,529 | 159,501 | ||||||||||
Reinvested |
2,497 | 4,503 | ||||||||||
Redeemed |
(77,197 | ) | (52,124 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
83,829 | 111,880 | ||||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 12)(b) |
||||||||||||
Issued |
213,539 | 186,993 | ||||||||||
Reinvested |
8,114 | 14,697 | ||||||||||
Redeemed |
(183,715 | ) | (146,919 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
37,938 | 54,771 | ||||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Issued |
23,345,684 | (c) | | |||||||||
Reinvested |
173,255 | (c) | | |||||||||
Redeemed |
(473,159 | )(c) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
23,045,780 | (c) | | |||||||||
|
|
|
|
|||||||||
Total change in shares |
23,275,665 | 596,484 | ||||||||||
|
|
|
|
|||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(c) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
168
Financial Highlights
Selected data for each share of capital outstanding throughout the periods indicated
Nationwide Ziegler Equity Income Fund
Operations | Distributions | Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period |
Net Investment Income |
Net
Realized and Unrealized Gains (Losses) from Investments |
Total from Operations |
Net Investment Income |
Total Distributions |
Net Asset Value, End of Period |
Total Return (a)(b)(c) |
Net Assets at End of Period |
Ratio of Expenses to Average Net Assets (d) |
Ratio of Net Investment Income to Average Net Assets (d) |
Ratio of Expenses (Prior to Net Assets (d)(e) |
Portfolio Turnover (f) |
||||||||||||||||||||||||||||||||||||||||
Class A Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 12.01 | 0.25 | 1.27 | 1.52 | (0.16 | ) | (0.16 | ) | $ | 13.37 | 12.69% | $ | 24,092,166 | 1.06% | 1.94% | 1.12% | 45.97% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 10.12 | 0.24 | 1.91 | 2.15 | (0.26 | ) | (0.26 | ) | $ | 12.01 | 21.57% | $ | 19,218,955 | 1.15% | 2.23% | 1.76% | 69.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 9.18 | 0.24 | 0.94 | 1.18 | (0.24 | ) | (0.24 | ) | $ | 10.12 | 13.12% | $ | 11,518,605 | 1.15% | 2.60% | 1.90% | 79.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 7.89 | 0.25 | 1.31 | 1.56 | (0.27 | ) | (0.27 | ) | $ | 9.18 | 19.98% | $ | 9,259,221 | 1.15% | 2.79% | 2.00% | 78.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 6.97 | 0.24 | 0.88 | 1.12 | (0.20 | ) | (0.20 | ) | $ | 7.89 | 16.06% | $ | 9,975,601 | 1.15% | 3.03% | 2.05% | 46.00% | ||||||||||||||||||||||||||||||||||
Class C Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 11.94 | 0.16 | 1.27 | 1.43 | (0.08 | ) | (0.08 | ) | $ | 13.29 | 12.00% | $ | 6,126,678 | 1.75% | 1.25% | 1.80% | 45.97% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 10.07 | 0.18 | 1.89 | 2.07 | (0.20 | ) | (0.20 | ) | $ | 11.94 | 20.79% | $ | 4,504,018 | 1.75% | 1.63% | 2.26% | 69.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 9.14 | 0.19 | 0.93 | 1.12 | (0.19 | ) | (0.19 | ) | $ | 10.07 | 12.40% | $ | 2,673,144 | 1.75% | 2.00% | 2.40% | 79.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 7.85 | 0.19 | 1.32 | 1.51 | (0.22 | ) | (0.22 | ) | $ | 9.14 | 19.37% | $ | 2,431,052 | 1.75% | 2.19% | 2.50% | 78.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 6.94 | 0.19 | 0.87 | 1.06 | (0.15 | ) | (0.15 | ) | $ | 7.85 | 15.22% | $ | 2,193,955 | 1.75% | 2.43% | 2.55% | 46.00% | ||||||||||||||||||||||||||||||||||
Institutional Service Class Shares (h) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 12.04 | 0.27 | 1.29 | 1.56 | (0.18 | ) | (0.18 | ) | $ | 13.42 | 13.05% | $ | 10,198,392 | 0.87% | 2.14% | 0.93% | 45.97% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 10.15 | 0.27 | 1.90 | 2.17 | (0.28 | ) | (0.28 | ) | $ | 12.04 | 21.80% | $ | 8,697,861 | 0.90% | 2.48% | 1.51% | 69.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 9.21 | 0.27 | 0.94 | 1.21 | (0.27 | ) | (0.27 | ) | $ | 10.15 | 13.38% | $ | 6,777,074 | 0.88% | 2.87% | 1.65% | 79.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 7.88 | 0.28 | 1.33 | 1.61 | (0.28 | ) | (0.28 | ) | $ | 9.21 | 20.68% | $ | 5,532,039 | 0.90% | 3.04% | 1.75% | 78.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 6.97 | 0.25 | 0.83 | 1.08 | (0.17 | ) | (0.17 | ) | $ | 7.88 | 15.50% | $ | 9,253 | 0.90% | 3.28% | 1.80% | 46.00% | ||||||||||||||||||||||||||||||||||
Institutional Class Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Period Ended July 31, 2014 (g)(i) |
$ | 12.15 | 0.27 | 1.20 | 1.47 | (0.20 | ) | (0.20 | ) | $ | 13.42 | 12.19% | $ | 309,242,204 | 0.66% | 2.33% | 0.66% | 45.97% | ||||||||||||||||||||||||||||||||||
(a) | Excludes sales charge. |
(b) | Not annualized for periods less than one year. |
(c) | Total returns prior to the Funds inception on September 16, 2013 are based on the performance of the Funds predecessor fund. |
(d) | Annualized for periods less than one year. |
(e) | During the period, certain fees may have been waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(f) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(g) | Per share calculations were performed using average shares method. |
(h) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(i) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. Total return is calculated based on inception date of September 18, 2013 through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
169
Fund Commentary | Nationwide Ziegler NYSE Arca Tech 100 Index Fund |
170
Fund Commentary (cont.) | Nationwide Ziegler NYSE Arca Tech 100 Index Fund |
171
Fund Overview | Nationwide Ziegler NYSE Arca Tech 100 Index Fund |
| Percentages indicated are based upon net assets as of July 31, 2014. |
| Percentages indicated are based upon total investments as of July 31, 2014. |
172
Fund Performance | Nationwide Ziegler NYSE Arca Tech 100 Index Fund |
173
Fund Performance (cont.) | Nationwide Ziegler NYSE Arca Tech 100 Index Fund |
Performance of a $10,000 Investment
Investment return and principal value will fluctuate, and when redeemed, shares may be worth more or less than original cost. Past performance is no guarantee of future results and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Investing in mutual funds involves market risk, including loss of principal. Performance returns assume the reinvestment of all distributions.
Comparative performance of $10,000 invested in Class A shares of the Nationwide Ziegler NYSE Arca Tech 100 Index Fund versus the NYSE Arca Tech 100 Index® and the Consumer Price Index (CPI) over the 10-year period ended 7/31/14. Fund performance prior to the Funds inception on 9/16/13 is based on the Funds predecessor fund. Unlike the Fund, the performance for these unmanaged indexes does not reflect any fees, expenses, or sales charges. One cannot invest directly in a market index. A description of the benchmarks can be found on the Market Index Definitions page at the back of this book.
174
Shareholder Expense Example | Nationwide Ziegler NYSE Arca Tech 100 Index Fund |
Schedule of Shareholder Expenses
Expense Analysis of a $1,000 Investment
Nationwide Ziegler NYSE Arca July 31, 2014 |
Beginning Account Value ($) 02/01/14 |
Ending Account Value ($) 07/31/14 |
Expenses Paid During Period ($) 02/01/14 - 07/31/14 |
Expense Ratio During Period (%) 02/01/14 - 07/31/14 | ||||||||
Class A Shares | Actual | (a) | 1,000.00 | 1,070.00 | 4.05 | 0.79 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,020.88 | 3.96 | 0.79 | ||||||||
Class C Shares | Actual | (a) | 1,000.00 | 1,066.20 | 7.89 | 1.54 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,017.16 | 7.70 | 1.54 | ||||||||
Institutional Service Class Shares(c) | Actual | (a) | 1,000.00 | 1,071.30 | 2.93 | 0.57 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,021.97 | 2.86 | 0.57 | ||||||||
Institutional Class Shares | Actual | (a) | 1,000.00 | 1,071.60 | 2.41 | 0.47 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,022.46 | 2.36 | 0.47 |
(a) | Expenses are equal to the Funds annualized expense ratio multiplied by the average account value from February 1, 2014 through July 31, 2014 multiplied to reflect one-half year period. The expense ratio presented represents a six-month, annualized ratio in accordance with Securities and Exchange Commission guidelines. |
(b) | Represents the hypothetical 5% return before expenses. |
(c) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
175
Statement of Investments
July 31, 2014
Nationwide Ziegler NYSE Arca Tech 100 Index Fund
176
Statement of Investments (Continued)
July 31, 2014
Nationwide Ziegler NYSE Arca Tech 100 Index Fund (Continued)
The accompanying notes are an integral part of these financial statements.
177
Statement of Assets and Liabilities
July 31, 2014
Nationwide Arca Tech
100 | ||||||
Assets: |
||||||
Investments, at value (cost $156,296,426) |
$ | 295,384,017 | ||||
Cash |
1,391,530 | |||||
Dividends receivable |
134,571 | |||||
Receivable for capital shares issued |
598,970 | |||||
Reclaims receivable |
32,282 | |||||
Prepaid expenses |
19,223 | |||||
|
|
|||||
Total Assets |
297,560,593 | |||||
|
|
|||||
Liabilities: |
||||||
Payable for investments purchased |
378,846 | |||||
Payable for capital shares redeemed |
120,848 | |||||
Accrued expenses and other payables: |
||||||
Investment advisory fees |
82,837 | |||||
Fund administration fees |
18,789 | |||||
Distribution fees |
69,636 | |||||
Administrative servicing fees |
53,960 | |||||
Accounting and transfer agent fees |
18,386 | |||||
Trustee fees |
655 | |||||
Custodian fees |
746 | |||||
Compliance program costs (Note 3) |
107 | |||||
Professional fees |
23,265 | |||||
Printing fees |
19,460 | |||||
Other |
3,908 | |||||
|
|
|||||
Total Liabilities |
791,443 | |||||
|
|
|||||
Net Assets |
$ | 296,769,150 | ||||
|
|
|||||
Represented by: |
||||||
Capital |
$ | 230,292,487 | ||||
Accumulated undistributed net investment income |
457,748 | |||||
Accumulated net realized losses from investments |
(73,068,676 | ) | ||||
Net unrealized appreciation/(depreciation) from investments |
139,087,591 | |||||
|
|
|||||
Net Assets |
$ | 296,769,150 | ||||
|
|
|||||
Net Assets: |
||||||
Class A Shares |
$ | 244,041,076 | ||||
Class C Shares |
19,986,986 | |||||
Institutional Service Class Shares |
32,435,707 | |||||
Institutional Class Shares |
305,381 | |||||
|
|
|||||
Total |
$ | 296,769,150 | ||||
|
|
|||||
Shares Outstanding (unlimited number of shares authorized): |
||||||
Class A Shares |
4,652,000 | |||||
Class C Shares |
418,996 | |||||
Institutional Service Class Shares |
613,023 | |||||
Institutional Class Shares |
5,775 | |||||
|
|
|||||
Total |
5,689,794 | |||||
|
|
|||||
178
Statement of Assets and Liabilities (Continued)
July 31, 2014
Nationwide Arca Tech
100 | ||||||
Net asset value and redemption price per share (Net assets by class divided by shares outstanding by class, respectively): |
||||||
Class A Shares (a) |
$ | 52.46 | ||||
Class C Shares (b) |
$ | 47.70 | ||||
Institutional Service Class Shares |
$ | 52.91 | ||||
Institutional Class Shares |
$ | 52.88 | ||||
Maximum offering price per share (100%/(100%-maximum sales charge) of net asset value adjusted to the nearest cent): |
||||||
Class A Shares |
$ | 55.66 | ||||
|
|
|||||
Maximum Sales Charge: |
||||||
Class A Shares |
5.75 | % | ||||
|
|
|||||
(a) | For Class A Shares, the redemption price per share is reduced by 1.00% on sales of shares of original purchases of $1,000,000 or more or that were not subject to a front-end sales charge made within 18 months of the purchase date. |
(b) | For Class C Shares, the redemption price per share is reduced by 1.00% for shares held less than one year. |
The accompanying notes are an integral part of these financial statements.
179
Statement of Operations
For the Year Ended July 31, 2014
Nationwide Arca Tech
100 | ||||||
INVESTMENT INCOME: |
||||||
Dividend income |
$ | 3,725,032 | ||||
Foreign tax withholding |
(8,280 | ) | ||||
|
|
|||||
Total Income |
3,716,752 | |||||
|
|
|||||
EXPENSES: |
||||||
Investment advisory fees |
915,150 | |||||
Fund administration fees |
283,917 | |||||
Distribution fees Class A |
583,277 | |||||
Distribution fees Class B (a) |
2,535 | |||||
Distribution fees Class C |
171,839 | |||||
Administrative servicing fees Class A |
302,893 | |||||
Administrative servicing fees Class B (a) |
845 | |||||
Administrative servicing fees Class C |
5,602 | |||||
Administrative servicing fees Institutional Service Class (b) |
35,783 | |||||
Registration and filing fees |
58,862 | |||||
Professional fees |
43,709 | |||||
Printing fees |
58,862 | |||||
Trustee fees |
7,076 | |||||
Custodian fees |
11,327 | |||||
Accounting and transfer agent fees |
94,584 | |||||
Compliance program costs (Note 3) |
1,920 | |||||
Other |
34,665 | |||||
|
|
|||||
Total expenses before earnings credit, fees waived, and expenses reimbursed |
2,612,846 | |||||
|
|
|||||
Earnings credit (Note 5) |
(224 | ) | ||||
Investment advisory fees waived (Note 3) |
(12,386 | ) | ||||
Administrative servicing fees voluntarily waived Class A (Note 3) |
(26,555 | ) | ||||
Administrative servicing fees voluntarily waived Institutional Service Class (Note 3) (b) |
(2,309 | ) | ||||
Expenses reimbursed by adviser (Note 3) |
(4,903 | ) | ||||
|
|
|||||
Net Expenses |
2,566,469 | |||||
|
|
|||||
NET INVESTMENT INCOME |
1,150,283 | |||||
|
|
|||||
REALIZED/UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: |
||||||
Net realized gains from investment transactions |
8,648,692 | |||||
Net change in unrealized appreciation/(depreciation) from investments |
43,924,900 | |||||
|
|
|||||
Net realized/unrealized gains from investments |
52,573,592 | |||||
|
|
|||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS |
$ | 53,723,875 | ||||
|
|
|||||
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
The accompanying notes are an integral part of these financial statements.
180
Statements of Changes in Net Assets
Nationwide Ziegler NYSE Arca Tech 100 Index Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
Operations: |
||||||||||||
Net investment income |
$ | 1,150,283 | $ | 743,106 | ||||||||
Net realized gains from investments |
8,648,692 | 3,953,136 | ||||||||||
Net change in unrealized appreciation/(depreciation) from investments |
43,924,900 | 44,583,754 | ||||||||||
|
|
|
|
|||||||||
Change in net assets resulting from operations |
53,723,875 | 49,279,996 | ||||||||||
|
|
|
|
|||||||||
Distributions to Shareholders From: |
||||||||||||
Net investment income: |
||||||||||||
Class A |
(652,733 | ) | (242,613 | ) | ||||||||
Class B (a) |
| | ||||||||||
Class C |
| | ||||||||||
Institutional Service Class (b) |
(158,119 | ) | (28,571 | ) | ||||||||
Institutional Class |
(474 | )(c) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from shareholder distributions |
(811,326 | ) | (271,184 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
(1,448,371 | ) | 3,236,202 | |||||||||
|
|
|
|
|||||||||
Change in net assets |
51,464,178 | 52,245,014 | ||||||||||
|
|
|
|
|||||||||
Net Assets: |
||||||||||||
Beginning of year |
245,304,972 | 193,059,958 | ||||||||||
|
|
|
|
|||||||||
End of year |
$ | 296,769,150 | $ | 245,304,972 | ||||||||
|
|
|
|
|||||||||
Accumulated undistributed net investment income at end of year |
$ | 457,748 | $ | 252,717 | ||||||||
|
|
|
|
|||||||||
CAPITAL TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
$ | 41,502,077 | $ | 46,342,546 | ||||||||
Proceeds from shares issued from class conversion |
2,546,766 | | ||||||||||
Dividends reinvested |
616,189 | 226,311 | ||||||||||
Cost of shares redeemed |
(56,249,694 | ) | (48,959,110 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
(11,584,662 | ) | (2,390,253 | ) | ||||||||
|
|
|
|
|||||||||
Class B Shares (Note 12)(a) |
||||||||||||
Proceeds from shares issued |
| 200 | ||||||||||
Dividends reinvested |
| | ||||||||||
Cost of shares redeemed in class conversion |
(2,546,766 | ) | | |||||||||
Cost of shares redeemed |
(327,080 | ) | (1,773,895 | ) | ||||||||
|
|
|
|
|||||||||
Total Class B Shares |
(2,873,846 | ) | (1,773,695 | ) | ||||||||
|
|
|
|
|||||||||
Class C Shares (Note 12) |
||||||||||||
Proceeds from shares issued |
5,383,789 | 1,987,025 | ||||||||||
Dividends reinvested |
| | ||||||||||
Cost of shares redeemed |
(2,493,189 | ) | (1,913,649 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
2,890,600 | 73,376 | ||||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 12)(b) |
||||||||||||
Proceeds from shares issued |
17,976,037 | 14,768,987 | ||||||||||
Dividends reinvested |
148,680 | 28,036 | ||||||||||
Cost of shares redeemed |
(8,299,349 | ) | (7,470,249 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
9,825,368 | 7,326,774 | ||||||||||
|
|
|
|
|||||||||
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(c) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
181
Statements of Changes in Net Assets (Continued)
Nationwide Ziegler NYSE Arca Tech 100 Index Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
CAPITAL TRANSACTIONS: (continued) |
||||||||||||
Institutional Class Shares |
||||||||||||
Proceeds from shares issued |
$ | 464,503 | (c) | $ | | |||||||
Dividends reinvested |
364 | (c) | | |||||||||
Cost of shares redeemed |
(170,698 | )(c) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
294,169 | (c) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
$ | (1,448,371 | ) | $ | 3,236,202 | |||||||
|
|
|
|
|||||||||
SHARE TRANSACTIONS: |
||||||||||||
Class A Shares (Note 12) |
||||||||||||
Issued |
859,437 | 1,198,597 | ||||||||||
Issued in class conversion |
57,223 | | ||||||||||
Reinvested |
13,032 | 6,211 | ||||||||||
Redeemed |
(1,155,636 | ) | (1,292,345 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
(225,944 | ) | (87,537 | ) | ||||||||
|
|
|
|
|||||||||
Class B Shares (Note 12)(a) |
||||||||||||
Issued |
| 5 | ||||||||||
Reinvested |
| | ||||||||||
Redeemed in class conversion |
(63,898 | ) | | |||||||||
Redeemed |
(8,347 | ) | (52,513 | ) | ||||||||
|
|
|
|
|||||||||
Total Class B Shares |
(72,245 | ) | (52,508 | ) | ||||||||
|
|
|
|
|||||||||
Class C Shares (Note 12) |
||||||||||||
Issued |
122,156 | 56,354 | ||||||||||
Reinvested |
| | ||||||||||
Redeemed |
(56,894 | ) | (55,512 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
65,262 | 842 | ||||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 12)(b) |
||||||||||||
Issued |
362,063 | 385,422 | ||||||||||
Reinvested |
3,086 | 763 | ||||||||||
Redeemed |
(167,640 | ) | (189,452 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
197,509 | 196,733 | ||||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Issued |
9,044 | (c) | | |||||||||
Reinvested |
7 | (c) | | |||||||||
Redeemed |
(3,276 | )(c) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
5,775 | (c) | | |||||||||
|
|
|
|
|||||||||
Total change in shares |
(29,643 | ) | 57,530 | |||||||||
|
|
|
|
|||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(c) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
182
Financial Highlights
Selected data for each share of capital outstanding throughout the periods indicated
Nationwide Ziegler NYSE Arca Tech 100 Index Fund
Operations | Distributions | Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period |
Net Investment Income (Loss) |
Net
Realized and Unrealized Gains (Losses) from Investments |
Total from Operations |
Net Investment Income |
Total Distributions |
Net Asset Value, End of Period |
Total Return (a)(b)(c) |
Net Assets at End of Period |
Ratio of Expenses to Average Net Assets (d) |
Ratio of Net Investment Income (Loss) to Average Net Assets (d) |
Ratio of Expenses (Prior to Reimbursements) to Average Net Assets (d)(e) |
Portfolio Turnover (f) |
||||||||||||||||||||||||||||||||||||||||
Class A Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 43.15 | 0.21 | 9.24 | 9.45 | (0.14 | ) | (0.14 | ) | $ | 52.46 | 21.93 | % | $ | 244,041,076 | 0.91 | % | 0.44 | % | 0.93 | % | 21.68 | % | |||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 34.34 | 0.14 | 8.72 | 8.86 | (0.05 | ) | (0.05 | ) | $ | 43.15 | 25.83 | % | $ | 210,474,970 | 1.08 | % | 0.37 | % | 1.22 | % | 33.00 | % | |||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 32.07 | (0.02 | ) | 2.29 | 2.27 | | | $ | 34.34 | 7.05 | % | $ | 170,515,922 | 1.08 | % | (0.07 | %) | 1.27 | % | 30.00 | % | ||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 25.62 | (0.05 | ) | 6.50 | 6.45 | | | $ | 32.07 | 25.17 | % | $ | 182,410,113 | 1.08 | % | (0.15 | %) | 1.27 | % | 11.00 | % | ||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 22.06 | (0.06 | ) | 3.62 | 3.56 | | | $ | 25.62 | 16.18 | % | $ | 162,266,663 | 1.08 | % | (0.26 | %) | 1.25 | % | 9.00 | % | ||||||||||||||||||||||||||||||
Class C Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 39.38 | - | 8.32 | 8.32 | | | $ | 47.70 | 21.13 | % | $ | 19,986,986 | 1.57 | % | (0.23 | %) | 1.57 | % | 21.68 | % | |||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 31.49 | (0.08 | ) | 7.97 | 7.89 | | | $ | 39.38 | 25.06 | % | $ | 13,930,080 | 1.68 | % | (0.23 | %) | 1.72 | % | 33.00 | % | ||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 29.58 | (0.20 | ) | 2.11 | 1.91 | | | $ | 31.49 | 6.42 | % | $ | 11,111,107 | 1.68 | % | (0.67 | %) | 1.77 | % | 30.00 | % | ||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 23.78 | (0.21 | ) | 6.01 | 5.80 | | | $ | 29.58 | 24.43 | % | $ | 11,269,283 | 1.68 | % | (0.75 | %) | 1.77 | % | 11.00 | % | ||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 20.59 | (0.20 | ) | 3.39 | 3.19 | | | $ | 23.78 | 15.49 | % | $ | 10,679,964 | 1.68 | % | (0.86 | %) | 1.75 | % | 9.00 | % | ||||||||||||||||||||||||||||||
Institutional Service Class Shares (h) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 43.58 | 0.01 | 9.63 | 9.64 | (0.31 | ) | (0.31 | ) | $ | 52.91 | 22.20 | % | $ | 32,435,707 | 0.66 | % | 0.67 | % | 0.68 | % | 21.68 | % | |||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 34.63 | 0.25 | 8.80 | 9.05 | (0.10 | ) | (0.10 | ) | $ | 43.58 | 26.19 | % | $ | 18,106,198 | 0.81 | % | 0.64 | % | 0.97 | % | 33.00 | % | |||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 32.26 | 0.06 | 2.31 | 2.37 | | | $ | 34.63 | 7.35 | % | $ | 7,575,853 | 0.81 | % | 0.20 | % | 1.02 | % | 30.00 | % | |||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 25.69 | 0.05 | 6.52 | 6.57 | | | $ | 32.26 | 25.58 | % | $ | 5,989,789 | 0.77 | % | 0.16 | % | 1.02 | % | 11.00 | % | |||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 22.06 | - | 3.63 | 3.63 | | | $ | 25.69 | 16.46 | % | $ | 311,833 | 0.83 | % | (0.01 | %) | 1.00 | % | 9.00 | % | |||||||||||||||||||||||||||||||
Institutional Class Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Period Ended July 31, 2014 (g)(i) |
$ | 45.87 | 0.01 | 7.39 | 7.40 | (0.39 | ) | (0.39 | ) | $ | 52.88 | 16.23 | % | $ | 305,381 | 0.48 | % | 0.82 | % | 0.48 | % | 21.68 | % | |||||||||||||||||||||||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Excludes sales charge. |
(b) | Not annualized for periods less than one year. |
(c) | Total returns prior to the Funds inception on September 16, 2013 are based on the performance of the Funds predecessor fund. |
(d) | Annualized for periods less than one year. |
(e) | During the period, certain fees may have been waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(f) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(g) | Per share calculations were performed using average shares method. |
(h) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(i) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. Total return is calculated based on inception date of September 18, 2013 through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
183
July 31, 2014
1. Organization
Nationwide Mutual Funds (the Trust) is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company, organized as a statutory trust under the laws of the State of Delaware. The Trust has authorized an unlimited number of shares of beneficial interest (shares), without par value. As of July 31, 2014, the Trust operates fifty-six (56) separate series, or mutual funds, each with its own investment objective(s) and strategies. This report contains the financial statements and financial highlights of the twelve (12) series listed below (each, a Fund; collectively, the Funds).
- Nationwide Bailard Cognitive Value Fund (Cognitive Value)
- Nationwide Bailard International Equities Fund (International Equities)
- Nationwide Bailard Technology & Science Fund (Technology & Science)
- Nationwide Geneva Mid Cap Growth Fund (Mid Cap Growth)
- Nationwide Geneva Small Cap Growth Fund (Small Cap Growth)
- Nationwide HighMark Balanced Fund (Balanced)
- Nationwide HighMark Large Cap Core Equity Fund (Large Cap Core Equity)
- Nationwide HighMark Large Cap Growth Fund (Large Cap Growth)
- Nationwide HighMark Small Cap Core Fund (Small Cap Core)
- Nationwide HighMark Value Fund (Value)
- Nationwide Ziegler Equity Income Fund (Equity Income)
- Nationwide Ziegler NYSE Arca Tech 100 Index Fund (NYSE Arca Tech 100 Index)
Each Fund commenced operations on September 16, 2013 as a result of a tax free reorganization in which Cognitive Value, International Equities, Technology & Science, Mid Cap Growth, Small Cap Growth, Balanced, Large Cap Core Equity, Large Cap Growth, Small Cap Core, Value, Equity Income, and NYSE Arca Tech 100 Index acquired all of the assets, subject to all liabilities and obligations, of the HighMark Cognitive Value Fund, HighMark International Opportunities Fund, HighMark Enhanced Growth Fund, HighMark Geneva Mid Cap Growth Fund, HighMark Geneva Small Cap Growth Fund, HighMark Balanced Fund, HighMark Large Cap Core Equity Fund, HighMark Large Cap Growth Fund, HighMark Small Cap Core Fund, HighMark Value Fund, HighMark Equity Income Fund, and HighMark NYSE Arca Tech 100 Index Fund, respectively, each a former series of HighMark Funds (each a Predecessor Fund, and collectively the Predecessor Funds). Each Fund has adopted the historical performance of its corresponding Predecessor Fund. Each Fund and its corresponding Predecessor Fund have substantially similar investment goals and strategies.
Each of the Funds is a diversified fund, as defined in the 1940 Act.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Funds in the preparation of their financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP). The preparation of financial statements requires Fund management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of income and expenses for the period. The Funds utilize various methods to measure the value of their investments on a recurring basis. Amounts received upon the sale of such investments could differ from those estimated values and those differences could be material.
(a) | Security Valuation |
U.S. GAAP defines fair value as the price that a Fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. The Trusts investment adviser to the Funds, Nationwide Fund Advisors (NFA), assigns a fair value, as defined by U.S. GAAP, to a Funds investments in accordance with a hierarchy that prioritizes the various types of inputs used to measure fair value. The hierarchy gives the highest priority to readily available unadjusted quoted prices in active markets for identical assets (Level 1
184
Notes to Financial Statements (Continued)
July 31, 2014
measurements) and the lowest priority to unobservable inputs (Level 3 measurements) when market prices are not readily available or reliable.
The three levels of the hierarchy are summarized below.
| Level 1 Quoted prices in active markets for identical assets |
| Level 2 Other significant observable inputs (including quoted prices of similar securities, interest rates, prepayment speeds, credit risk, etc.) |
| Level 3 Significant unobservable inputs (including a Funds own assumptions in determining the fair value of investments) |
Changes in valuation techniques may result in transfers into or out of an investments assigned level within the hierarchy.
An investments categorization within the hierarchy is based on the lowest level of any input that is significant to the fair valuation in its entirety. The inputs or methodology used to value investments are not intended to indicate the risk associated with investing in those investments.
Securities for which market-based quotations are readily available are valued at the current market value as of Valuation Time. Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4:00 p.m. Eastern time). Equity securities are generally valued at the last quoted sale price or official closing price, or, if there is no such price, the last quoted bid price provided by an independent pricing service approved by the Trusts Board of Trustees (the Board of Trustees). Prices are taken from the primary market or exchange on which each security trades. Shares of registered open-end management investment companies are valued at net asset value (NAV) as reported by such company. Shares of unaffiliated exchange-traded funds are generally valued at the last quoted sale price or official closing price, or, if there is no such price, the last quoted bid price provided by an independent pricing service. Investments valued in this manner are generally categorized as Level 1 investments within the hierarchy.
Debt and other fixed-income securities are generally valued at the bid evaluation price provided by an independent pricing service as approved by the Board of Trustees. Evaluations provided by independent pricing service providers may be determined without exclusive reliance on quoted prices and may use broker-dealer quotations, individual trading characteristics and other market data, reported trades or valuation estimates from their internal pricing models. The independent pricing service providers internal models use inputs that are observable such as issuer details, interest rates, yield curves, prepayment speeds, credit risks/spreads, default rates, anticipated timing of principal repayments, and quoted prices for similar assets and are generally categorized as Level 2 investments within the hierarchy. Debt obligations generally involve some risk of default with respect to interest and/or principal payments.
The Board of Trustees has delegated authority to NFA, and the Trusts administrator, Nationwide Fund Management LLC (NFM), to assign a fair value under certain circumstances (e.g., pricing service does not provide a price as there may be no market-based quotations or price provided is deemed unreliable by NFA, NFM and/or designee), pursuant to valuation procedures approved by the Board of Trustees. NFA and NFM have established a Fair Valuation Committee (FVC) to assign these fair valuations.
The fair value of a security may differ from its quoted or published price. Fair valuation of portfolio securities may occur on a daily basis.
Securities may be fair valued in a variety of circumstances, such as where (i) market-based quotations are not readily available; (ii) an independent pricing service does not provide a value or the value provided by an independent pricing service is determined to be unreliable in the judgment of NFA or its designee; (iii) a significant event has occurred that affects the value of a Funds securities after trading has stopped (e.g., earnings announcements or news relating to natural disasters affecting an issuers operations); (iv) the securities are illiquid; (v) the securities
185
Notes to Financial Statements (Continued)
July 31, 2014
have defaulted or been delisted from an exchange and are no longer trading; or (vi) any other circumstance in which the FVC believes that market-based quotations do not accurately reflect the value of a security.
The fair valuation of securities takes into account relevant factors and surrounding circumstances, including, but not limited to, the prices of related or comparable assets or liabilities, recent transactions, market multiples, anticipated cash flows, the nature and duration of any restrictions on transfer, book values, and other information relevant to the investment. Methods utilized to determine fair value may include, among others, the following: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity for debt issues; or (iv) a combination of these and other methods. Fair valuations may also take into account significant events that occur before Valuation Time but after the close of the principal market on which a security trades that materially affect the value of such security. The FVC monitors the results of fair valuation determinations and regularly reports the results to the Board of Trustees. That said, there can be no assurance that the fair value assigned to a security is the price at which a security could have been sold during the period in which the particular fair value was used to value the security. To the extent the inputs used are observable these securities are classified as Level 2 otherwise Level 3.
Securities listed on a non-American exchange are generally fair valued daily by an independent fair value pricing service approved by the Board of Trustees and categorized as Level 2 investments within the hierarchy. The fair valuations for these securities may not be the same as quoted or published prices of the securities on their primary markets. Securities for which daily fair value prices from the independent fair value pricing service are not available are generally valued at the last quoted sale price at the close of an exchange on which the security is traded and categorized as Level 2 investments within the hierarchy. Values of foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees.
Bank loans are valued using an average bid price provided by an independent pricing service. Evaluated quotes provided by the independent pricing service may reflect appropriate factors such as ratings, tranche type, industry, company performance, and other market data. The independent pricing service utilizes internal models and uses observable inputs such as issuer details, interest rates, tranche type, ratings and other market data. Securities valued in this manner are generally categorized as Level 2, consistent with similar valuation techniques and inputs described above for debt and equity securities.
At July 31, 2014, 100% of the market value of Small Cap Growth, Large Cap Core Equity, Large Cap Growth, Equity Income, and NYSE Arca Tech 100 Index were determined based on Level 1 inputs.
The following tables provide a summary of the inputs used to value the Funds net assets as of July 31, 2014. Please refer to the Statements of Investments for additional information on portfolio holdings.
Cognitive Value
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: |
||||||||||||||||
Common Stocks |
$ | 97,517,820 | $ | | $ | | $ | 97,517,820 | ||||||||
Exchange Traded Funds |
4,266,408 | | | 4,266,408 | ||||||||||||
Mutual Fund |
470,456 | | | 470,456 | ||||||||||||
Repurchase Agreement |
| 4,344,544 | | 4,344,544 | ||||||||||||
Total |
$ | 102,254,684 | $ | 4,344,544 | $ | | $ | 106,599,228 |
186
Notes to Financial Statements (Continued)
July 31, 2014
International Equities
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: |
||||||||||||||||
Common Stocks |
||||||||||||||||
Aerospace & Defense |
$ | | $ | 881,509 | $ | | $ | 881,509 | ||||||||
Air Freight & Logistics |
| 2,879,521 | | 2,879,521 | ||||||||||||
Airlines |
| 1,933,312 | | 1,933,312 | ||||||||||||
Auto Components |
1,073,875 | 7,351,150 | | 8,425,025 | ||||||||||||
Automobiles |
983,000 | 3,218,080 | | 4,201,080 | ||||||||||||
Banks |
6,870,130 | 25,585,535 | | 32,455,665 | ||||||||||||
Biotechnology |
| 934,553 | | 934,553 | ||||||||||||
Capital Markets |
1,942,496 | 7,366,438 | | 9,308,934 | ||||||||||||
Chemicals |
| 6,112,361 | | 6,112,361 | ||||||||||||
Commercial Services & Supplies |
| 1,852,726 | | 1,852,726 | ||||||||||||
Communications Equipment |
| 996,151 | | 996,151 | ||||||||||||
Construction & Engineering |
| 8,308,611 | | 8,308,611 | ||||||||||||
Construction Materials |
| 2,324,762 | | 2,324,762 | ||||||||||||
Containers & Packaging |
| 4,576,854 | | 4,576,854 | ||||||||||||
Diversified Financial Services |
| 3,703,090 | | 3,703,090 | ||||||||||||
Diversified Telecommunication Services |
| 10,967,352 | | 10,967,352 | ||||||||||||
Electric Utilities |
| 2,269,231 | | 2,269,231 | ||||||||||||
Electrical Equipment |
| 1,127,180 | | 1,127,180 | ||||||||||||
Energy Equipment & Services |
| 1,134,466 | | 1,134,466 | ||||||||||||
Food & Staples Retailing |
| 6,203,319 | | 6,203,319 | ||||||||||||
Food Products |
| 9,354,806 | | 9,354,806 | ||||||||||||
Gas Utilities |
| 2,304,207 | | 2,304,207 | ||||||||||||
Health Care Providers & Services |
| 1,552,899 | | 1,552,899 | ||||||||||||
Hotels, Restaurants & Leisure |
| 4,654,793 | | 4,654,793 | ||||||||||||
Household Durables |
| 5,655,493 | | 5,655,493 | ||||||||||||
Household Products |
| 3,493,742 | | 3,493,742 | ||||||||||||
Industrial Conglomerates |
| 1,141,087 | | 1,141,087 | ||||||||||||
Information Technology Services |
1,480,140 | 3,787,899 | | 5,268,039 | ||||||||||||
Insurance |
| 15,018,969 | | 15,018,969 | ||||||||||||
Internet Software & Services |
647,500 | | | 647,500 | ||||||||||||
Leisure Products |
| 942,219 | | 942,219 | ||||||||||||
Life Sciences Tools & Services |
| 1,663,405 | | 1,663,405 | ||||||||||||
Machinery |
| 3,551,641 | | 3,551,641 | ||||||||||||
Marine |
| 1,146,092 | | 1,146,092 | ||||||||||||
Media |
| 4,340,222 | | 4,340,222 | ||||||||||||
Metals & Mining |
2,460,686 | 2,744,608 | | 5,205,294 | ||||||||||||
Multiline Retail |
| 1,141,320 | | 1,141,320 | ||||||||||||
Multi-Utilities |
| 1,289,226 | | 1,289,226 | ||||||||||||
Oil, Gas & Consumable Fuels |
6,227,202 | 14,293,607 | | 20,520,809 | ||||||||||||
Paper & Forest Products |
| 4,966,661 | | 4,966,661 | ||||||||||||
Personal Products |
| 1,233,727 | | 1,233,727 | ||||||||||||
Pharmaceuticals |
2,276,249 | 13,749,912 | | 16,026,161 | ||||||||||||
Professional Services |
761,370 | 1,012,420 | | 1,773,790 | ||||||||||||
Real Estate Investment Trusts (REITs) |
| 1,876,209 | | 1,876,209 | ||||||||||||
Road & Rail |
| 1,766,554 | | 1,766,554 | ||||||||||||
Semiconductors & Semiconductor Equipment |
| 2,203,705 | | 2,203,705 | ||||||||||||
Software |
| 960,677 | | 960,677 | ||||||||||||
Specialty Retail |
| 2,283,666 | | 2,283,666 | ||||||||||||
Technology Hardware, Storage & Peripherals |
| 6,495,488 | | 6,495,488 | ||||||||||||
Textiles, Apparel & Luxury Goods |
| 1,924,862 | | 1,924,862 | ||||||||||||
Tobacco |
| 3,056,292 | | 3,056,292 |
187
Notes to Financial Statements (Continued)
July 31, 2014
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: (continued) |
||||||||||||||||
Common Stocks (continued) |
||||||||||||||||
Trading Companies & Distributors |
$ | | $ | 3,250,498 | $ | | $ | 3,250,498 | ||||||||
Wireless Telecommunication Services |
717,200 | 6,623,183 | | 7,340,383 | ||||||||||||
Total Common Stocks |
$ | 25,439,848 | $ | 229,206,290 | $ | | $ | 254,646,138 | ||||||||
Exchange Traded Fund |
3,603,000 | | | 3,603,000 | ||||||||||||
Forward Foreign Currency Contracts |
| 299,113 | | 299,113 | ||||||||||||
Mutual Fund |
500,041 | | | 500,041 | ||||||||||||
Repurchase Agreement |
| 4,617,759 | | 4,617,759 | ||||||||||||
Total |
$ | 29,542,889 | $ | 234,123,162 | $ | | $ | 263,666,051 |
Technology & Science
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: |
||||||||||||||||
Common Stocks |
||||||||||||||||
Biotechnology |
$ | 6,191,290 | $ | | $ | | $ | 6,191,290 | ||||||||
Communications Equipment |
9,806,751 | | | 9,806,751 | ||||||||||||
Electronic Equipment, Instruments & Components |
3,489,256 | | | 3,489,256 | ||||||||||||
Information Technology Services |
12,904,706 | | | 12,904,706 | ||||||||||||
Internet & Catalog Retail |
2,548,933 | | | 2,548,933 | ||||||||||||
Internet Software & Services |
15,774,562 | | | 15,774,562 | ||||||||||||
Life Sciences Tools & Services |
452,370 | | | 452,370 | ||||||||||||
Pharmaceuticals |
701,670 | | | 701,670 | ||||||||||||
Semiconductors & Semiconductor Equipment |
15,487,784 | 833,359 | | 16,321,143 | ||||||||||||
Software |
16,142,469 | | | 16,142,469 | ||||||||||||
Technology Hardware, Storage & Peripherals |
15,842,512 | | | 15,842,512 | ||||||||||||
Total |
$ | 99,342,303 | $ | 833,359 | $ | | $ | 100,175,662 |
Mid Cap Growth
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: |
||||||||||||||||
Common Stocks |
$ | 1,454,394,696 | $ | | $ | | $ | 1,454,394,696 | ||||||||
Mutual Fund |
559,979 | | | 559,979 | ||||||||||||
Repurchase Agreement |
| 5,171,271 | | 5,171,271 | ||||||||||||
Total |
$ | 1,454,954,675 | $ | 5,171,271 | $ | | $ | 1,460,125,946 |
Balanced
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: |
||||||||||||||||
Asset-Backed Securities |
$ | | $ | 625,771 | $ | | $ | 625,771 | ||||||||
Bank Loans |
| 29,582 | | 29,582 | ||||||||||||
Collateralized Mortgage Obligations |
| 98,424 | | 98,424 | ||||||||||||
Commercial Mortgage Backed Securities |
| 1,037,270 | | 1,037,270 | ||||||||||||
Common Stocks |
18,801,412 | | | 18,801,412 | ||||||||||||
Corporate Bonds |
| 6,629,449 | | 6,629,449 | ||||||||||||
Municipal Bonds |
| 367,256 | | 367,256 | ||||||||||||
U.S. Government Mortgage Backed Agencies |
| 1,712,767 | | 1,712,767 | ||||||||||||
U.S. Treasury Notes |
| 1,770,223 | | 1,770,223 | ||||||||||||
Total |
$ | 18,801,412 | $ | 12,270,742 | $ | | $ | 31,072,154 |
188
Notes to Financial Statements (Continued)
July 31, 2014
Small Cap Core
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: |
||||||||||||||||
Common Stocks |
||||||||||||||||
Aerospace & Defense |
$ | 1,160,404 | $ | | $ | | $ | 1,160,404 | ||||||||
Airlines |
536,362 | | | 536,362 | ||||||||||||
Auto Components |
1,271,403 | | | 1,271,403 | ||||||||||||
Automobiles |
314,665 | | | 314,665 | ||||||||||||
Banks |
4,932,873 | | | 4,932,873 | ||||||||||||
Biotechnology |
3,396,433 | | | 3,396,433 | ||||||||||||
Building Products |
642,278 | | | 642,278 | ||||||||||||
Capital Markets |
1,632,341 | | | 1,632,341 | ||||||||||||
Chemicals |
705,279 | | | 705,279 | ||||||||||||
Commercial Services & Supplies |
611,276 | | | 611,276 | ||||||||||||
Communications Equipment |
1,337,926 | | | 1,337,926 | ||||||||||||
Construction & Engineering |
842,617 | | | 842,617 | ||||||||||||
Construction Materials |
636,418 | | | 636,418 | ||||||||||||
Containers & Packaging |
2,020,710 | | | 2,020,710 | ||||||||||||
Diversified Consumer Services |
517,436 | | | 517,436 | ||||||||||||
Electric Utilities |
1,724,819 | | | 1,724,819 | ||||||||||||
Electrical Equipment |
252,915 | | | 252,915 | ||||||||||||
Electronic Equipment, Instruments & Components |
217,685 | | | 217,685 | ||||||||||||
Energy Equipment & Services |
3,940,387 | | | 3,940,387 | ||||||||||||
Food & Staples Retailing |
951,296 | | | 951,296 | ||||||||||||
Food Products |
342,240 | | | 342,240 | ||||||||||||
Health Care Equipment & Supplies |
5,795,386 | 18 | | 5,795,404 | ||||||||||||
Health Care Providers & Services |
2,097,868 | | | 2,097,868 | ||||||||||||
Health Care Technology |
1,145,064 | | | 1,145,064 | ||||||||||||
Hotels, Restaurants & Leisure |
4,047,862 | | | 4,047,862 | ||||||||||||
Household Durables |
363,258 | | | 363,258 | ||||||||||||
Household Products |
802,308 | | | 802,308 | ||||||||||||
Independent Power and Renewable Electricity Producers |
910,665 | | | 910,665 | ||||||||||||
Information Technology Services |
531,358 | | | 531,358 | ||||||||||||
Insurance |
1,530,087 | | | 1,530,087 | ||||||||||||
Internet Software & Services |
1,628,597 | | | 1,628,597 | ||||||||||||
Life Sciences Tools & Services |
149,348 | | | 149,348 | ||||||||||||
Machinery |
2,904,351 | | | 2,904,351 | ||||||||||||
Media |
1,646,838 | | | 1,646,838 | ||||||||||||
Metals & Mining |
596,681 | | | 596,681 | ||||||||||||
Oil, Gas & Consumable Fuels |
889,053 | | | 889,053 | ||||||||||||
Paper & Forest Products |
1,136,077 | | | 1,136,077 | ||||||||||||
Personal Products |
188,920 | | | 188,920 | ||||||||||||
Pharmaceuticals |
445,275 | | | 445,275 | ||||||||||||
Professional Services |
3,455,460 | | | 3,455,460 | ||||||||||||
Real Estate Investment Trusts (REITs) |
8,810,869 | | | 8,810,869 | ||||||||||||
Road & Rail |
1,573,981 | | | 1,573,981 | ||||||||||||
Semiconductors & Semiconductor Equipment |
5,438,711 | | | 5,438,711 | ||||||||||||
Software |
4,539,828 | | | 4,539,828 | ||||||||||||
Specialty Retail |
1,374,629 | | | 1,374,629 | ||||||||||||
Technology Hardware, Storage & Peripherals |
610,519 | | | 610,519 | ||||||||||||
Textiles, Apparel & Luxury Goods |
1,308,945 | | | 1,308,945 | ||||||||||||
Thrifts & Mortgage Finance |
460,702 | | | 460,702 |
189
Notes to Financial Statements (Continued)
July 31, 2014
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: (continued) |
||||||||||||||||
Common Stocks (continued) |
||||||||||||||||
Wireless Telecommunication Services |
$ | 411,919 | $ | | $ | | $ | 411,919 | ||||||||
Total Common Stocks |
$ | 82,782,322 | $ | 18 | $ | | $ | 82,782,340 | ||||||||
Total Assets |
$ | 82,782,322 | $ | 18 | $ | | $ | 82,782,340 | ||||||||
Liabilities: |
||||||||||||||||
Futures Contracts |
(101,148 | ) | | | (101,148 | ) | ||||||||||
Total Liabilities |
$ | (101,148 | ) | $ | | $ | | $ | (101,148 | ) | ||||||
Total |
$ | 82,681,174 | $ | 18 | $ | | $ | 82,681,192 |
Value
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: |
||||||||||||||||
Common Stocks |
||||||||||||||||
Aerospace & Defense |
$ | 6,330,884 | $ | 5,057,041 | $ | | $ | 11,387,925 | ||||||||
Air Freight & Logistics |
5,435,098 | | | 5,435,098 | ||||||||||||
Auto Components |
4,111,035 | | | 4,111,035 | ||||||||||||
Banks |
32,475,900 | | | 32,475,900 | ||||||||||||
Beverages |
6,206,352 | | | 6,206,352 | ||||||||||||
Capital Markets |
28,244,091 | | | 28,244,091 | ||||||||||||
Chemicals |
3,104,586 | | | 3,104,586 | ||||||||||||
Communications Equipment |
5,320,035 | | | 5,320,035 | ||||||||||||
Construction & Engineering |
2,425,595 | | | 2,425,595 | ||||||||||||
Consumer Finance |
7,053,210 | | | 7,053,210 | ||||||||||||
Diversified Financial Services |
6,391,315 | 3,610,945 | | 10,002,260 | ||||||||||||
Diversified Telecommunication Services |
7,208,547 | | | 7,208,547 | ||||||||||||
Electrical Equipment |
4,425,667 | | | 4,425,667 | ||||||||||||
Electronic Equipment, Instruments & Components |
3,892,212 | | | 3,892,212 | ||||||||||||
Energy Equipment & Services |
5,803,072 | | | 5,803,072 | ||||||||||||
Food Products |
5,474,700 | | | 5,474,700 | ||||||||||||
Health Care Equipment & Supplies |
8,001,453 | | | 8,001,453 | ||||||||||||
Health Care Providers & Services |
16,793,209 | | | 16,793,209 | ||||||||||||
Household Products |
12,954,781 | | | 12,954,781 | ||||||||||||
Industrial Conglomerates |
3,163,296 | | | 3,163,296 | ||||||||||||
Information Technology Services |
7,767,408 | | | 7,767,408 | ||||||||||||
Insurance |
10,919,679 | | | 10,919,679 | ||||||||||||
Internet & Catalog Retail |
3,649,305 | | | 3,649,305 | ||||||||||||
Machinery |
11,478,927 | | | 11,478,927 | ||||||||||||
Media |
19,971,831 | | | 19,971,831 | ||||||||||||
Metals & Mining |
1,040,759 | | | 1,040,759 | ||||||||||||
Multiline Retail |
5,301,424 | | | 5,301,424 | ||||||||||||
Oil, Gas & Consumable Fuels |
35,165,474 | | | 35,165,474 | ||||||||||||
Paper & Forest Products |
3,570,575 | | | 3,570,575 | ||||||||||||
Pharmaceuticals |
15,500,126 | | | 15,500,126 | ||||||||||||
Real Estate Investment Trusts (REITs) |
3,795,671 | | | 3,795,671 | ||||||||||||
Road & Rail |
3,779,081 | | | 3,779,081 | ||||||||||||
Semiconductors & Semiconductor Equipment |
2,845,422 | | | 2,845,422 | ||||||||||||
Software |
13,353,027 | | | 13,353,027 | ||||||||||||
Technology Hardware, Storage & Peripherals |
8,618,662 | | | 8,618,662 | ||||||||||||
Tobacco |
4,549,505 | | | 4,549,505 |
190
Notes to Financial Statements (Continued)
July 31, 2014
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: (continued) |
||||||||||||||||
Common Stocks (continued) |
||||||||||||||||
Trading Companies & Distributors |
$ | 57,935 | $ | | $ | | $ | 57,935 | ||||||||
Total Common Stocks |
$ | 326,179,849 | $ | 8,667,986 | $ | | $ | 334,847,835 | ||||||||
Mutual Fund |
319,930 | | | 319,930 | ||||||||||||
Preferred Stock |
| 2,897,544 | | 2,897,544 | ||||||||||||
Repurchase Agreement |
| 2,954,470 | | 2,954,470 | ||||||||||||
Total |
$ | 326,499,779 | $ | 14,520,000 | $ | | $ | 341,019,779 |
Amounts designated as , which may include fair valued securities, are zero or have been rounded to zero.
During the year ended July 31, 2014, there were no significant transfers into or out of Level 1, Level 2 or Level 3.
(b) | Foreign Currency Transactions |
The accounting records of the Funds are maintained in U.S. dollars. The Funds may, nevertheless, engage in foreign currency transactions. In those instances, a Fund will convert foreign currency amounts into U.S. dollars at the current rate of exchange between the foreign currency and the U.S. dollar in order to determine the value of the Funds investments, assets, and liabilities.
Purchases and sales of securities, receipts of income, and payments of expenses are converted at the prevailing rate of exchange on the respective date of such transactions. The accounting records of a Fund do not differentiate that portion of the results of operations resulting from changes in foreign exchange rates from those resulting from changes in the market prices of the relevant securities. Each portion contributes to the net realized gain or loss from investment transactions and net change in unrealized appreciation/(depreciation) from investments. Net currency gains or losses, realized and unrealized, that are a result of differences between the amount recorded on a Funds accounting records, and the U.S. dollar equivalent amount actually received or paid for interest or dividends, receivables and payables for investments sold or purchased, and foreign cash, are included in the Statement of Operations under Net realized gains/losses from foreign currency transactions and Net change in unrealized appreciation/(depreciation) from translation of assets and liabilities denominated in foreign currencies.
(c) | Forward Foreign Currency Contracts |
International Equities is subject to foreign currency exchange risk in the normal course of pursuing its objectives. International Equities entered into forward foreign currency contracts in connection with planned purchases or sales of securities denominated in a foreign currency and/or to hedge the U.S. dollar value of portfolio securities denominated in a foreign currency. A forward foreign currency contract involves an obligation to purchase or sell a specific currency at a future date, which may be any fixed number of days from the date of the contract agreed upon by the parties, at a price set at the time of the contract. Forward foreign currency contracts are generally valued at the mean of the last quoted bid and ask prices, as provided by an independent pricing service approved by the Board of Trustees, and are generally categorized as Level 2 investments within the hierarchy. The market value of a forward foreign currency contract fluctuates with changes in foreign currency exchange rates. All commitments are marked to market daily at the applicable exchange rates and any resulting unrealized appreciation or depreciation is recorded. Realized gains or losses are recorded at the time the forward foreign currency contract at the time of settlement date or if the fund enters into an offsetting contract before the contractual settlement date or by delivery of the currency. Forward foreign currency contracts entail the risk of unanticipated movements in the value of the foreign currency relative to the U.S. dollar, and the risk that the counterparties to the contracts may be unable to meet their obligations under the contract.
191
Notes to Financial Statements (Continued)
July 31, 2014
International Equities forward foreign currency contracts are reflected in the Statement of Assets and Liabilities under Unrealized appreciation/(depreciation) on forward foreign currency contracts, and in the Statement of Operations under Net realized gains/losses from forward and foreign currency transactions and Net change in unrealized appreciation/(depreciation) from forward foreign currency contracts.
(d) | Options |
Technology & Science purchased put options on equity securities, and entered into closing transactions with respect to such options to terminate existing positions. Such put option investments are utilized to hedge against price volatility of the underlying investment. The purchase of put options serves as a short hedge.
Exchange-traded options are generally valued at the last quoted sale price or official closing price, if available, and otherwise at the last quoted bid price, and are generally categorized as Level 1 investments within the hierarchy. The value of an option position reflects, among other things, the implied price volatility of the underlying investment, the current market value of the underlying investment, the time remaining until expiration of the option, the relationship of the strike price to the market price of the underlying investment, and general market conditions. Options that expire unexercised have no value. The Fund uses only American-style options, which can be exercised at any time prior to the expiration date of the option. This is in contrast to European-style options which can only be exercised at expiration of the option.
Exchange-traded options are issued by a clearing organization affiliated with the exchange on which the option is listed that, in effect, guarantees completion of every exchange-traded option transaction.
The Fund effectively terminates its right under an option by entering into a closing transaction. Closing transactions permit the Fund to realize the profit or limit the loss on an option position prior to its exercise or expiration. If the Fund is unable to effect a closing transaction for an option it purchased, it would have to exercise the option to realize any profit.
The writing and purchasing of options is a highly specialized activity that involves investment techniques and risks different from those associated with ordinary portfolio securities transactions. Imperfect correlation between options and the securities markets may detract from the effectiveness of attempted hedging.
The Funds purchased options are disclosed in the Statement of Assets and Liabilities under Investments, at value and in the Statement of Operations under Net realized gains/losses from investment transactions and Net change in unrealized appreciation/(depreciation) from investments.
At July 31, 2014, Technology & Science had no open options contracts.
(e) | Futures Contracts |
International Equities, Large Cap Core Equity, and Small Cap Core are subject to equity price risk in the normal course of pursuing their investment objectives. International Equities, Large Cap Core Equity, and Small Cap Core entered into financial futures contracts (futures contracts) to enable the Funds to more closely approximate the performance of their benchmark indices or for tactical hedging purposes. Futures contracts are contracts for delayed delivery of securities or currencies at a specific future date and at a specific price or currency amount.
Upon entering into a futures contract, a Fund is required to pledge to the broker an initial margin deposit of cash and/or other assets equal to a certain percentage of the futures contracts notional value. Under a futures contract, a Fund agrees to receive from or pay to a broker an amount of cash equal to the daily fluctuation in value of the futures contract. Subsequent receipts or payments, known as variation margin receipts or payments, are made each day, depending on the fluctuation in the fair value of the futures contract, and are recognized by a Fund as unrealized gains or losses. Futures contracts are generally valued daily at their settlement price as provided by an independent pricing service approved by the Board of Trustees, and are generally categorized as Level 1 investments within the hierarchy.
192
Notes to Financial Statements (Continued)
July 31, 2014
A sale of a futures contract means a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price or amount at a specified time in the future. A purchase of a futures contract means a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. When a futures contract is closed, a Fund records a realized gain or loss equal to the difference between the value of the futures contract at the time it was opened and its value at the time it was closed.
Should market conditions change unexpectedly, a Fund may not achieve the anticipated benefits of futures contracts and may realize a loss. The use of futures contracts for hedging purposes involves the risk of imperfect correlation in the movements in the price of the futures contracts and the underlying assets. A Funds investments in futures contracts entail limited counterparty credit risk because the Fund invests only in exchange-traded futures contracts, which are settled through the exchange and whose fulfillment is guaranteed by the credit of the exchange.
A Funds futures contracts are reflected in the Statement of Assets and Liabilities under Net unrealized appreciation/(depreciation) from futures contracts, and in the Statement of Operations under Net realized gains/losses from futures transactions and Net change in unrealized appreciation/(depreciation) from futures contracts.
At July 31, 2014, International Equities had no open futures contracts.
The following tables provide a summary of the Funds derivative instruments categorized by risk exposure as of July 31, 2014:
Fair Values of Derivatives not Accounted for as Hedging Instruments as of July 31, 2014
International Equities
Assets: | Statement of Assets & Liabilities | Fair Value | ||||
Forward Foreign Currency Contracts |
||||||
Currency risk |
Unrealized appreciation on forward foreign currency contracts | $ | 299,113 | |||
Total |
$ | 299,113 |
Large Cap Core Equity
Liabilities: | Statement of Assets & Liabilities | Fair Value | ||||
Futures Contracts* |
||||||
Equity risk |
Unrealized depreciation from futures contracts | $ | (32,533 | ) | ||
Total |
$ | (32,533 | ) |
Small Cap Core
Liabilities: | Statement of Assets & Liabilities | Fair Value | ||||
Futures Contracts* |
||||||
Equity risk |
Unrealized depreciation from futures contracts | $ | (101,148 | ) | ||
Total |
$ | (101,148 | ) |
* | Includes cumulative appreciation/(depreciation) of futures contracts as reported in the Statement of Investments. Only current days variation margin is reported within the Statement of Assets & Liabilities. |
193
Notes to Financial Statements (Continued)
July 31, 2014
The Effect of Derivative Instruments on the Statement of Operations for the Year Ended July 31, 2014
International Equities
Realized Gain/(Loss): | Total | |||
Forward Foreign Currency Contracts |
||||
Currency risk |
$ | 1,262,043 | ||
|
||||
Futures Contracts |
||||
Equity risk |
114,341 | |||
|
||||
Total |
$ | 1,376,384 | ||
|
Technology & Science
Realized Gain/(Loss): | Total | |||
Purchased Options(a) |
||||
Equity risk |
$ | | ||
|
||||
Total |
$ | | ||
|
Large Cap Core Equity
Realized Gain/(Loss): | Total | |||
Futures Contracts |
||||
Equity risk |
$ | 334,482 | ||
|
||||
Total |
$ | 334,482 | ||
|
Small Cap Core
Realized Gain/(Loss): | Total | |||
Futures Contracts |
||||
Equity risk |
$ | 377,591 | ||
|
||||
Total |
$ | 377,591 | ||
|
(a) | Realized gains/(losses) from purchased options are included in Net realized gains/losses from investment transactions. |
Amounts designated as are zero or have been rounded to zero.
Change in Unrealized Appreciation/(Depreciation) on Derivatives Recognized in the Statement of Operations for the Year Ended July 31, 2014
International Equities
Unrealized Appreciation/(Depreciation): | Total | |||
Forward Foreign Currency Contracts |
||||
Currency risk |
$ | 582,161 | ||
|
||||
Futures Contracts |
||||
Equity risk |
(84,595 | ) | ||
|
||||
Total |
$ | 497,566 | ||
|
194
Notes to Financial Statements (Continued)
July 31, 2014
Large Cap Core Equity
Unrealized Appreciation/(Depreciation): | Total | |||
Futures Contracts |
||||
Equity risk |
$ | (26,899 | ) | |
|
||||
Total |
$ | (26,899 | ) | |
|
Small Cap Core
Unrealized Appreciation/(Depreciation): | Total | |||
Futures Contracts |
||||
Equity risk |
$ | (116,978 | ) | |
|
||||
Total |
$ | (116,978 | ) | |
|
Information about derivative instruments reflected as of the date of this report is generally indicative of the type and volume of derivative activity for International Equities (forward foreign currency contracts), Large Cap Core Equity (futures contracts), and Small Cap Core (futures contracts) during the year ended July 31, 2014.
During February and March 2014, Technology & Science held purchased options contracts with an average notional balance of $22,800. For the remainder of the year ended July 31, 2014, Technology & Science had no investments in derivatives.
During August and September 2013, International Equities held futures contracts with an average notional balance of $6,303,114. For the remainder of the year ended July 31, 2014, International Equities had no investments in futures.
The Funds are required to disclose information about offsetting and related arrangements to enable users of the financial statements to understand the effect of those arrangements on the Funds financial position. For financial reporting purposes, International Equities, Large Cap Core Equity, and Small Cap Core present all financial assets and financial liabilities on a gross basis that are subject to master netting arrangements or similar agreements on the Statement of Assets and Liabilities. At July 31, 2014, the futures contracts agreements do not permit Large Cap Core Equity or Small Cap Core to enforce netting arrangements.
The following tables set forth International Equities net exposure by counterparty for forward foreign currency contracts that are subject to enforceable master netting arrangements or similar agreements as of July 31, 2014:
Offsetting of Financial Assets and Derivative Assets:
Description | Gross Amounts of Recognized Derivative Assets |
Gross Amounts Offset in the Statement of Assets and Liabilities |
Net Amounts of Derivative Assets Presented in the Statement of Assets and Liabilities |
|||||||
Forward Foreign Currency Contracts |
$299,113 | $ | | $ | 299,113 | |||||
Total |
$299,113 | $ | | $ | 299,113 |
Amounts designated as are zero.
195
Notes to Financial Statements (Continued)
July 31, 2014
Financial Assets, Derivative Assets and Collateral Pledged by Counterparty:
Gross Amounts not Offset in the Statement of Assets and Liabilities |
||||||||||||||
Counterparty | Net Amounts of Derivative Assets Presented in the Statement of Assets and Liabilities |
Derivatives Available for Offset |
Collateral Received |
Net Amount of Derivative Assets |
||||||||||
Brown Brothers Harriman & Co. |
$299,113 | $ | | $ | | $ | 299,113 | |||||||
Total |
$299,113 | $ | | $ | | $ | 299,113 |
Amounts designated as are zero.
(f) | Securities Lending |
During the period from September 16, 2013 through July 31, 2014, Cognitive Value, International Equities, Mid Cap Growth, and Value entered into securities lending transactions. To generate additional income, the Funds lent their portfolio securities, up to 33 1/3% of the total assets of each Fund, to brokers, dealers, and other financial institutions. The collateral that a Fund receives is included in calculating the Funds total assets. The Funds securities lending standards and guidelines require that the borrower (i) deliver cash or U.S. Government securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (ii) at all times thereafter mark-to-market the collateral on a daily basis so that the market value of such collateral is at least 100% of the value of securities loaned. A Fund receives payments from the securities lending agent equivalent to the dividends and interest that would have been earned on the securities loaned while simultaneously seeking to earn income on the investment of cash collateral. Income from the securities lending program is recorded when received from the securities lending agent. There may be risks of delay or restrictions in recovery of the securities or disposal of collateral should the borrower of the securities fail financially. Loans are made, however, only to borrowers deemed by the securities lending agent to be of good standing and creditworthy. Loans are subject to termination by a Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. For the period from September 16, 2013 through March 31, 2014, JPMorgan Chase Bank, N.A. (JPMorgan) served as securities lending agent for the securities lending program of the Funds. JPMorgan received a fee based on a percentage of earnings derived from the investment of cash collateral. Effective April 1, 2014, Brown Brothers Harriman & Co. (BBH) began serving as the primary securities lending agent for the securities lending program of the Funds. BBH receives a fee based on the difference between the income earned on the investment of cash collateral received from borrowers and the cash collateral fee. Information on the investment of cash collateral is shown in the Statement of Investments.
For the period from September 16, 2013 through March 31, 2014, in the event of a default by a borrower with respect to any loan, JPMorgan exercised any and all remedies provided under the applicable borrower agreement to make a Fund whole. These remedies included purchasing replacement securities by applying the collateral held from the defaulting borrower against the purchase cost of the replacement securities. If, despite such efforts by JPMorgan to exercise these remedies, a Fund sustained losses as a result of a borrowers default, JPMorgan indemnified the Fund by purchasing replacement securities at its expense, or would pay the Fund an amount equal to the market value of the replacement securities, subject to certain limitations which were set forth in detail in the Securities Lending Agency Agreement between the Funds and JPMorgan. Effective April 1, 2014, in the event of a default by a borrower with respect to any loan, BBH will exercise any and all remedies provided under the applicable borrower agreement to make a Fund whole. These remedies include purchasing replacement securities by applying the collateral held from the defaulting borrower against the purchase cost of the replacement securities. If, despite such efforts by BBH to exercise these remedies, the collateral is less than the purchase cost of the replacement securities, BBH is responsible for such shortfall, subject to certain limitations that are set forth in detail in the Securities Lending Agency Agreement between the Funds and BBH.
196
Notes to Financial Statements (Continued)
July 31, 2014
At July 31, 2014, the BBH Securities Lending Agreement does not permit the Funds to enforce a netting arrangement.
Prior to September 16, 2013, the Predecessor Funds did not enter into any securities lending transactions.
(g) | Repurchase Agreements |
For the period from September 16, 2013 through July 31, 2014, Cognitive Value, International Equities, Mid Cap Growth, and Value, along with other series of the Trust, pursuant to procedures adopted by the Board of Trustees and applicable guidance from the Securities and Exchange Commission (SEC), transferred cash collateral received from securities lending transactions, through a joint account at the securities lending agent, the daily aggregate balance of which is invested in one or more repurchase agreements collateralized by U.S. Treasury or federal agency obligations. In a repurchase agreement, the seller of a security agrees to repurchase the security at a mutually agreed-upon time and price, which reflects the effective rate of return for the term of the agreement. For joint repurchase agreements, The Bank of New York Mellon, JPMorgan or BBH takes possession of the collateral pledged for investments in such repurchase agreements (repo or collectively repos). The underlying collateral is valued daily on a mark-to-market basis to ensure that the value is equal to or greater than the repurchase price including accrued interest. In the event of default of the obligation to repurchase, a Fund has the right to liquidate the collateral and apply the proceeds in satisfaction of the obligation. If the seller defaults and the value of the collateral declines or if bankruptcy proceedings are commenced with respect to the seller of the security, realization of the collateral by a Fund may be delayed or limited.
At July 31, 2014, the repo on a gross basis was as follows:
Royal Bank of Canada, 0.06%, dated 07/31/14, due 08/01/14, repurchase price $171,300,285, collateralized by a U.S. Treasury Note, 0.63%, maturing 09/30/17; total market value $174,797,033.
Please refer to the Statement of Investments for each Funds undivided interest in the joint repurchase agreement and related collateral.
At July 31, 2014, the Funds investment in the repurchase agreement was subject to an enforceable netting arrangement. The Funds proportionate holding in the repurchase agreement was as follows:
Gross Amounts not Offset in the Statement of Assets and Liabilities |
||||||||||||||||||||||||
Fund | Counterparty | Gross Amount of Recognized Assets |
Gross Amounts Offset in the Statement of Assets and Liabilities |
Net Amounts of Assets Presented in the Statement of Assets and Liabilities |
Collateral Received |
Net Amount of Assets |
||||||||||||||||||
Cognitive Value |
Royal Bank of Canada | $ | 4,344,544 | $ | | $ | 4,344,544 | $ | (4,344,544 | ) | $ | | ||||||||||||
International Equities |
Royal Bank of Canada | 4,617,759 | | 4,617,759 | (4,617,759 | ) | | |||||||||||||||||
Mid Cap Growth |
Royal Bank of Canada | 5,171,271 | | 5,171,271 | (5,171,271 | ) | | |||||||||||||||||
Value |
Royal Bank of Canada | 2,954,470 | | 2,954,470 | (2,954,470 | ) | |
Amounts designated as are zero.
197
Notes to Financial Statements (Continued)
July 31, 2014
(h) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold. Security gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization of premiums or accretion of discounts, and is recorded as such on a Funds Statement of Operations. Dividend income is recorded on the ex-dividend date and is recorded as such on a Funds Statement of Operations, except for certain dividends from foreign securities, which are recorded as soon as the Trust is informed on or after the ex-dividend date.
Foreign income and capital gains may be subject to foreign withholding taxes and capital gains taxes at various rates. Under applicable foreign law, a withholding of tax may be imposed on interest and dividends paid by a foreign security and capital gains from the sale of a foreign security. Foreign income or capital gains subject to foreign withholding taxes are recorded net of the applicable withholding tax.
For certain securities, including a real estate investment trust (REIT), a Fund records distributions received in excess of earnings and profits of such security as a reduction of cost of investments and/or realized gain (referred to as a return of capital). Additionally, a REIT may characterize distributions it pays as long-term capital gains. Such distributions are based on estimates if actual amounts are not available. Actual distributions of income, long-term capital gain and return of capital may differ from the estimated amounts. A Fund will recharacterize the estimated amounts of the components of distributions as necessary, once the issuers provide information about the actual composition of the distributions. Any portion of a distribution deemed a return of capital is generally not taxable to a Fund.
A Fund records as dividend income the amount characterized as ordinary income and records as realized gain the amount characterized by a REIT as long-term capital gain in the Statement of Operations. The amount characterized as return of capital is a reduction to the cost of investments in the Statement of Assets and Liabilities if the security is still held, otherwise it is recorded as an adjustment to realized gain / loss from investments transaction in the Statement of Operations. These characterizations are reflected in the accompanying financial statements.
(i) | Distributions to Shareholders |
Effective September 16, 2013, distributions from net investment income, if any, are declared and paid quarterly. Prior to September 16, 2013, each of the Funds declared and paid dividends from net investment income periodically. Distributions from net realized capital gains, if any, are declared and distributed at least annually. All distributions are recorded on the ex-dividend date.
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from U.S. GAAP. These book/tax differences are considered either permanent or temporary. Permanent differences are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. The permanent differences as of July 31, 2014 are primarily attributable to capital loss carryforward expirations, distribution redesignations, foreign currency gains and losses, net operating losses not utilized, non- REIT returns of capital dividends and reclassifications, partnership distributions, passive foreign investment company gain/loss on sales, and paydown gains and losses. These reclassifications have no effect upon the NAV of a Fund. Any distribution in excess of current and accumulated earnings and profits for federal income tax purposes is reported as a return of capital distribution.
198
Notes to Financial Statements (Continued)
July 31, 2014
Reclassifications for the year ended July 31, 2014 were as follows:
Fund | Capital | Accumulated undistributed net investment income |
Accumulated net realized gains/(losses) from investment transactions |
|||||||||
Cognitive Value |
$ | | $ | 132,343 | $ | (132,343 | ) | |||||
International Equities |
| 1,583,430 | (1,583,430 | ) | ||||||||
Technology & Science |
| (14,701 | ) | 14,701 | ||||||||
Mid Cap Growth |
(11,854,697 | ) | 12,819,714 | (965,017 | ) | |||||||
Small Cap Growth |
(1,300,616 | ) | 1,300,616 | | ||||||||
Balanced |
| 13,685 | (13,685 | ) | ||||||||
Large Cap Core Equity |
| (6,465 | ) | 6,465 | ||||||||
Large Cap Growth |
| | | |||||||||
Small Cap Core |
(194,329 | ) | 179,257 | 15,072 | ||||||||
Value |
(90,852 | ) | 827,965 | (737,113 | ) | |||||||
Equity Income |
(1,741,439 | ) | (5,646 | ) | 1,747,085 | |||||||
NYSE Arca Tech 100 Index |
| (133,926 | ) | 133,926 |
Amounts designated as are zero or have been rounded to zero.
(j) | Deferred Compensation Plan |
On April 17, 2013, the Predecessor Funds terminated a deferred compensation plan that had previously been established for the benefit of certain members of the Predecessor Funds Board. Effective September 16, 2013, the Funds assumed the deferred compensation liability of their corresponding Predecessor Funds. At July 31, 2014, the Funds fully paid the deferred compensation plan to the Predecessor Funds Board and no remaining liability remained for the Funds.
(k) | Federal Income Taxes |
Each Fund elected to be treated as, and intends to qualify each year as, a Regulated Investment Company by complying with the provisions available to certain investment companies under Subchapter M of the U.S. Internal Revenue Code of 1986, as amended, and to make distributions of net investment income and net realized capital gains sufficient to relieve a Fund from all, or substantially all, federal income taxes. Therefore, no federal income tax provision is required.
A Fund recognizes a tax benefit from an uncertain position only if it is more likely than not that the position is sustainable, based solely on its technical merits and consideration of the relevant taxing authorities widely understood administrative practices and precedents. A Fund undertakes an affirmative evaluation of tax positions taken or expected to be taken in the course of preparing tax returns to determine whether it is more likely than not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. If such a tax position taken by a Fund is not sustained upon examination by a taxing authority that Fund could incur taxes and penalties related to that position, and those amounts could be material. A tax position that meets the more likely than not recognition threshold is measured to determine the amount of benefits to recognize in the financial statements. Differences result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). The Funds file U.S. federal income tax returns and, if applicable, returns in various foreign jurisdictions in which they invest. The last four tax year ends, or since inception (if shorter), and any interim tax period since then generally remain open for examination by taxing authorities.
199
Notes to Financial Statements (Continued)
July 31, 2014
Each Fund engages in ongoing monitoring and analysis; future conclusions reached by management could be different and result in adjustments to a Funds NAV and financial statements. The Funds are not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
(l) | Allocation of Expenses, Income and Gains and Losses |
Expenses directly attributable to a Fund are charged to that Fund. Expenses not directly attributable to a Fund are allocated proportionally among various or all series of the Trust. Income, fund level expenses, and realized and unrealized gains or losses are allocated to each class of shares of a Fund based on the value of the outstanding shares of that class relative to the total value of the outstanding shares of that Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that specific class.
3. Transactions with Affiliates
Effective September 16, 2013 under the terms of the Trusts Investment Advisory Agreement, NFA manages the investments of the assets and supervises the daily business affairs of the Funds in accordance with policies and procedures established by the Board of Trustees. NFA is a wholly owned subsidiary of Nationwide Financial Services, Inc. (NFS), a holding company which is a direct wholly owned subsidiary of Nationwide Corporation. NFA provides investment management evaluation services in monitoring, on an ongoing basis, the performance of the subadvisers.
As of July 31, 2014, the subadvisers for each Fund are as follows:
Fund | Subadviser | |
Cognitive Value |
Bailard, Inc. | |
International Equities |
Bailard, Inc. | |
Technology & Science |
Bailard, Inc. | |
Mid Cap Growth |
Geneva Capital Management Ltd. | |
Small Cap Growth |
Geneva Capital Management Ltd. | |
Balanced |
HighMark Capital Management, Inc. (HighMark) | |
Large Cap Core Equity |
HighMark | |
Large Cap Growth |
HighMark | |
Small Cap Core |
HighMark | |
Value |
HighMark | |
Equity Income |
Ziegler Capital Management, LLC | |
NYSE Arca Tech 100 Index |
Ziegler Capital Management, LLC |
200
Notes to Financial Statements (Continued)
July 31, 2014
Effective September 16, 2013, under the terms of the Investment Advisory Agreement, each Fund pays NFA an investment advisory fee based on that Funds average daily net assets. The Funds paid investment advisory fees to NFA according to the schedule below.
Fund | Fee Schedule | Advisory Fee (annual rate) |
||||
Cognitive Value |
Up to $500 million | 0.75 | % | |||
On $500 million and more | 0.70 | % | ||||
International Equities |
Up to $1 billion | 0.75 | % | |||
On $1 billion and more | 0.70 | % | ||||
Technology & Science |
Up to $500 million | 0.75 | % | |||
On $500 million up to $1 billion | 0.70 | % | ||||
On $1 billion and more | 0.65 | % | ||||
Mid Cap Growth |
Up to $250 million | 0.75 | % | |||
On $250 million up to $500 million | 0.70 | % | ||||
On $500 million and more | 0.65 | % | ||||
Small Cap Growth |
Up to $250 million | 1.00 | % | |||
On $250 million up to $500 million | 0.95 | % | ||||
On $500 million and more | 0.90 | % | ||||
Balanced |
All Assets | 0.60 | % | |||
Large Cap Core Equity |
||||||
Large Cap Growth |
||||||
Value |
||||||
Small Cap Core |
All Assets | 0.95 | % | |||
Equity Income |
Up to $100 million | 0.55 | % | |||
$100 million up to $500 million | 0.50 | % | ||||
On $500 million and more | 0.45 | % | ||||
NYSE Arca Tech 100 Index |
Up to $50 million | 0.50 | % | |||
$50 million up to $250 million | 0.30 | % | ||||
$250 million up to $500 million | 0.25 | % | ||||
On $500 million and more | 0.20 | % |
201
Notes to Financial Statements (Continued)
July 31, 2014
Prior to September 16, 2013, each Fund paid investment advisory fees to HighMark under a similar agreement based on that Funds average daily net assets. The Funds paid investment advisory fees to HighMark according to the schedule below.
Fund | Fee Schedule | Advisory Fee (annual rate) |
||||
Cognitive Value |
Up to $500 million | 0.75 | % | |||
On $500 million and more | 0.70 | % | ||||
International Equities |
Up to $1 billion | 0.75 | % | |||
On $1 billion and more | 0.70 | % | ||||
Technology & Science |
Up to $500 million | 0.75 | % | |||
On $500 million up to $1 billion | 0.70 | % | ||||
On $1 billion and more | 0.65 | % | ||||
Mid Cap Growth |
Up to $250 million | 0.75 | % | |||
On $250 million up to $500 million | 0.70 | % | ||||
On $500 million and more | 0.65 | % | ||||
Small Cap Growth |
Up to $250 million | 1.00 | % | |||
On $250 million up to $500 million | 0.95 | % | ||||
On $500 million and more | 0.90 | % | ||||
Balanced |
All Assets | 0.60 | % | |||
Large Cap Core Equity |
||||||
Large Cap Growth |
||||||
Value |
||||||
Small Cap Core |
All Assets | 0.95 | % | |||
Equity Income |
Up to $100 million | 0.55 | % | |||
$100 million up to $500 million | 0.50 | % | ||||
On $500 million and more | 0.45 | % | ||||
NYSE Arca Tech 100 Index |
Up to $50 million | 0.50 | % | |||
$50 million up to $250 million | 0.30 | % | ||||
$250 million up to $500 million | 0.25 | % | ||||
On $500 million and more | 0.20 | % |
For the year ended July 31, 2014, the effective advisory fee rates before and after contractual advisory fee waivers were as follows:
Fund | Effective Advisory Fee Rate Before Contractual* Fee Waivers |
Effective Advisory Fee Rate After |
||||||
Cognitive Value |
0.75 | % | N/A | |||||
International Equities |
0.75 | N/A | ||||||
Technology & Science |
0.75 | N/A | ||||||
Mid Cap Growth |
0.67 | N/A | ||||||
Small Cap Growth |
1.00 | N/A | ||||||
Balanced |
0.60 | N/A | ||||||
Large Cap Core Equity |
0.60 | N/A | ||||||
Large Cap Growth |
0.60 | N/A | ||||||
Small Cap Core |
0.95 | N/A | ||||||
Value |
0.60 | N/A |
202
Notes to Financial Statements (Continued)
July 31, 2014
Fund | Effective Advisory Fee Rate Before Contractual* Fee Waivers |
Effective Advisory Fee Rate After |
||||||
Equity Income |
0.52 | % | N/A | |||||
NYSE Arca Tech 100 Index |
0.33 | 0.33 | % |
* | Please see below for additional information regarding contractual waivers. |
N/A Not Applicable.
For the period from September 16, 2013 through July 31, 2014, the effective advisory rates for fees paid to NFA were as follows:
Fund | Effective Advisory Fee Rate |
|||
Cognitive Value |
0.75 | % | ||
International Equities |
0.75 | |||
Technology & Science |
0.75 | |||
Mid Cap Growth |
0.67 | |||
Small Cap Growth |
1.00 | |||
Balanced |
0.60 | |||
Large Cap Core Equity |
0.60 | |||
Large Cap Growth |
0.60 | |||
Small Cap Core |
0.95 | |||
Value |
0.60 | |||
Equity Income |
0.52 | |||
NYSE Arca Tech 100 Index |
0.33 |
For the period from September 16, 2013 through July 31, 2014, the Funds paid investment management fees to NFA in the amounts listed below.
Fund | Amount | |||
Cognitive Value |
$ | 698,862 | ||
International Equities |
1,647,720 | |||
Technology & Science |
657,983 | |||
Mid Cap Growth |
8,942,907 | |||
Small Cap Growth |
1,257,013 | |||
Balanced |
160,265 | |||
Large Cap Core Equity |
320,270 | |||
Large Cap Growth |
361,449 | |||
Small Cap Core |
670,692 | |||
Value |
1,817,262 | |||
Equity Income |
865,359 | |||
NYSE Arca Tech 100 Index |
809,651 |
From these fees, pursuant to the subadvisory agreements, NFA pays fees to the unaffiliated subadvisers.
203
Notes to Financial Statements (Continued)
July 31, 2014
Prior to September 16, 2013, the Funds were managed by, and paid investment management fees to, HighMark. For the period from August 1, 2013 through September 15, 2013, the Funds paid investment management fees to HighMark in the amounts listed below.
Fund | Amount | |||
Cognitive Value |
$ | 89,546 | ||
International Equities |
205,895 | |||
Technology & Science |
85,794 | |||
Mid Cap Growth |
1,197,657 | |||
Small Cap Growth |
141,432 | |||
Balanced |
25,256 | |||
Large Cap Core Equity |
45,006 | |||
Large Cap Growth |
54,317 | |||
Small Cap Core |
86,623 | |||
Value |
261,016 | |||
Equity Income |
22,904 | |||
NYSE Arca Tech 100 Index |
105,499 |
Effective September 16, 2013, the Funds and NFA have entered into a written Expense Limitation Agreement that limits the Funds operating expenses (excluding acquired fund fees and expenses, and certain other expenses) from exceeding the following amounts until February 28, 2015:
Fund | Class A | Class C | Institutional Service Class |
Institutional Class |
Class U | Class M | ||||||||||||||||||
Cognitive Value |
1.47 | % | 2.07 | % | 1.22 | % | 1.07 | % | N/A | 1.07 | % | |||||||||||||
International Equities |
1.42 | 2.10 | 1.27 | 1.10 | N/A | 1.10 | ||||||||||||||||||
Technology & Science |
1.45 | 2.05 | 1.20 | 1.05 | N/A | 1.05 | ||||||||||||||||||
Mid Cap Growth |
1.38 | 1.98 | 1.13 | 0.98 | N/A | N/A | ||||||||||||||||||
Small Cap Growth |
1.62 | 2.22 | 1.37 | 1.22 | N/A | N/A | ||||||||||||||||||
Balanced |
1.24 | 1.84 | 0.99 | 0.84 | N/A | N/A | ||||||||||||||||||
Large Cap Core Equity |
1.22 | 1.82 | 0.97 | 0.82 | N/A | N/A | ||||||||||||||||||
Large Cap Growth |
1.27 | 1.87 | 1.02 | 0.87 | N/A | N/A | ||||||||||||||||||
Small Cap Core |
1.62 | 2.22 | 1.37 | 1.22 | N/A | N/A | ||||||||||||||||||
Value |
1.25 | 1.85 | 1.00 | 0.85 | 0.87 | % | N/A | |||||||||||||||||
Equity Income |
1.15 | 1.75 | 0.90 | 0.75 | N/A | N/A | ||||||||||||||||||
NYSE Arca Tech 100 Index |
1.08 | 1.68 | 0.83 | 0.68 | N/A | N/A |
N/A | Not Applicable. |
NFA may request and receive reimbursement from a Fund for advisory fees waived and other expenses reimbursed by NFA pursuant to the Expense Limitation Agreement at a date not to exceed three years from the month in which the corresponding waiver or reimbursement to a Fund was made. However, no reimbursement may be made unless: (i) a Funds assets exceed $100 million and (ii) the total annual expense ratio of the class making such reimbursement is no higher than the amount of the expense limitation that was in place at the time NFA waived the fees or reimbursed the expenses and does not cause the expense ratio to exceed the current expense limitation. Reimbursement by a Fund of amounts previously waived or assumed by NFA is not permitted except as provided for in the Expense Limitation Agreement. The Expense Limitation Agreement may be changed or eliminated only with the consent of the Board of Trustees.
204
Notes to Financial Statements (Continued)
July 31, 2014
As of July 31, 2014, the cumulative potential reimbursements for the Funds, listed by the period in which NFA waived fees or reimbursed expenses to the Funds, are:
Fund | Period Ended July 31, 2014 (a) |
|||
Cognitive Value |
$ | | ||
International Equities |
| |||
Technology & Science |
| |||
Mid Cap Growth |
| |||
Small Cap Growth |
3,329 | |||
Balanced |
141,707 | |||
Large Cap Core Equity |
30,107 | |||
Large Cap Growth |
45,495 | |||
Small Cap Core |
2,303 | |||
Value |
| |||
Equity Income |
45 | |||
NYSE Arca Tech 100 Index |
|
(a) | For the period from September 16, 2013 through July 31, 2014. |
Amounts designated as are zero or have been rounded to zero.
During the period from September 16, 2013 through July 31, 2014, no amounts were reimbursed to NFA by the Funds pursuant to the Expense Limitation Agreement.
Prior to September 16, 2013, HighMark contractually agreed to reduce its fees (excluding portfolio brokerage and transaction costs, taxes relating to transacting in foreign securities, if any, extraordinary expenses and any expenses indirectly incurred by a Fund through investments in pooled investment vehicles), and to the extent necessary to reimburse the Funds in order to limit the Funds from exceeding certain expense limitations. For the period from August 1, 2013 through September 15, 2013, expenses reimbursed under the terms of that agreement were as follows:
Fund | Amount | |||
Cognitive Value |
$ | 3,943 | ||
International Equities |
5,050 | |||
Technology & Science |
5,440 | |||
Mid Cap Growth |
| |||
Small Cap Growth |
20,201 | |||
Balanced |
16,650 | |||
Large Cap Core Equity |
16,069 | |||
Large Cap Growth |
14,544 | |||
Small Cap Core |
9,447 | |||
Value |
18,823 | |||
Equity Income |
18,107 | |||
NYSE Arca Tech 100 Index |
4,903 |
Amount designated as is zero or has been rounded to zero.
Prior to September 16, 2013 the Funds were subject to a recoupment plan under HighMark (Predecessor Plan). Under the Predecessor Plan HighMark was able to recoup from the Funds any of the fees and expenses it waived until the end of the third fiscal year after the end of the fiscal year in which such waiver and/or reimbursement occurred, subject to
205
Notes to Financial Statements (Continued)
July 31, 2014
certain limitations. For the period from August 1, 2013 through September 15, 2013, Mid Cap Growth reimbursed $45,468 to HighMark for fees or expenses waived in prior years. Effective September 16, 2013, the Predecessor Plan was terminated.
Effective September 16, 2013, NFM, a wholly owned subsidiary of NFS Distributors, Inc. (NFSDI) (a wholly owned subsidiary of NFS), provides various administrative and accounting services for the Funds and serves as Transfer and Dividend Disbursing Agent for the Funds. NFM has entered into an agreement with a third-party service provider to provide certain sub-administration and sub-transfer agency services to the Funds. NFM pays the service provider a fee for these services.
Effective September 16, 2013, under the terms of a Joint Fund Administration and Transfer Agency Agreement, the fees for such services are based on the sum of the following: (i) the amount payable by NFM to its sub-administrator and sub-transfer agent; and (ii) a percentage of the combined average daily net assets of the Trust and Nationwide Variable Insurance Trust, a Delaware statutory trust and registered investment company that is affiliated with the Trust, according to the fee schedule below.
Combined Fee Schedule | ||||
Up to $25 billion |
0.025% | |||
$25 billion and more |
0.020% |
During the period from September 16, 2013 through July 31, 2014, NFM earned $2,000,299 in fees from the Funds under the Joint Fund Administration and Transfer Agency Agreement.
Prior to September 16, 2013, the Funds were series of an investment trust that was a party to an Administration Agreement with HighMark (the Administrator) under which the Administrator provided administrative services to such investment trust for an annual fee of 0.15% of the first $8 billion of the average daily net assets of the Funds and 0.14% of such average daily net assets in excess of $8 billion allocated to each Fund based on its respective net assets. For the period from August 1, 2013 through September 15, 2013, the Administrator received fees from the Funds in the amounts listed below.
Fund | Amount | |||
Cognitive Value |
$ | 21,782 | ||
International Equities |
47,839 | |||
Technology & Science |
20,469 | |||
Mid Cap Growth |
361,349 | |||
Small Cap Growth |
30,489 | |||
Balanced |
10,030 | |||
Large Cap Core Equity |
16,259 | |||
Large Cap Growth |
20,555 | |||
Small Cap Core |
17,238 | |||
Value |
84,464 | |||
Equity Income |
11,194 | |||
NYSE Arca Tech 100 Index |
75,021 |
Effective September 16, 2013, the Trust pays out-of-pocket expenses reasonably incurred by NFM in providing services to the Funds and the Trust, including, but not limited to, the cost of pricing services that NFM utilizes and networking fees paid to broker-dealers that provide sub-accounting and sub-transfer agency services to their customers who are Fund shareholders. Such services, which are not otherwise provided by NFM, generally include individual account maintenance and recordkeeping, dividend disbursement, responding to shareholder calls and inquiries, providing statements and transaction confirmations, tax reporting, and other shareholder services. Depending on the nature and quality of the services provided, fees for these services may range from $6 to $21 per customer per year.
206
Notes to Financial Statements (Continued)
July 31, 2014
Effective September 16, 2013, under the terms of the Joint Fund Administration and Transfer Agency Agreement and a letter agreement between NFM and the Trust, the Trust has agreed to reimburse NFM for certain costs related to the Funds portion of ongoing administration, monitoring and annual (compliance audit) testing of the Trusts Rule 38a-1 Compliance Program subject to the pre-approval of the Trusts Audit Committee. These costs are allocated among the series of the Trust based upon their relative net assets. For the period from September 16, 2013 through July 31, 2014, the Funds aggregate portion of such costs amounted to $5,234. For the period from August 1, 2013, through September 15, 2013, the Funds paid $19,319 to HighMark under a similar agreement.
Effective September 16, 2013, under the terms of a Distribution Plan pursuant to Rule 12b-1 under the 1940 Act, Nationwide Fund Distributors LLC (NFD), the Funds principal underwriter, is compensated by the Funds for expenses associated with the distribution of certain classes of shares of the Funds. NFD is a wholly owned subsidiary of NFSDI. These fees are based on average daily net assets of the respective class of the Funds at an annual rate as follows:
| 0.25% of the average daily net assets of Class A shares of each Fund (distribution or service fee) |
| 1.00% of the average daily net assets of Class C shares of each Fund (0.75% of which may be a distribution fee and 0.25% service fee) |
Prior to September 16, 2013, HighMark Funds Distributors, LLC (the Distributor), a wholly owned subsidiary of Foreside Funds Distributors LLC, and the Funds were parties to an underwriting agreement. HighMark adopted 12b-1 Plans (the Plans) with respect to Class A, Class B, and Class C Shares that allowed each Fund to pay distribution and service fees to the Distributor as compensation for its services under the Plans. The Distributor received a distribution fee computed daily and paid monthly, at the annual rate of 0.25% of the daily net assets attributable to each Funds Class A Shares, 0.75% of the daily net assets attributable to each Funds Class B Shares and 1.00% of the daily net assets attributable to each Funds Class C Shares, which was used by the Distributor to provide compensation for sales support and distribution activities.
For the period from August 1, 2013 through September 15, 2013, the Funds paid distribution fees to the Distributor in the amounts listed below.
Fund | Amount | |||
Cognitive Value |
$ | 1,042 | ||
International Equities |
2,828 | |||
Technology & Science |
982 | |||
Mid Cap Growth |
275,112 | |||
Small Cap Growth |
23,357 | |||
Balanced |
9,780 | |||
Large Cap Core Equity |
4,280 | |||
Large Cap Growth |
9,092 | |||
Small Cap Core |
9,038 | |||
Value |
33,473 | |||
Equity Income |
12,704 | |||
NYSE Arca Tech 100 Index |
86,564 |
Effective September 16, 2013, pursuant to an Underwriting Agreement, NFD serves as principal underwriter of the Funds in the continuous distribution of their shares and receives commissions in the form of a front-end sales charge on Class A shares. These fees are deducted from, and are not included in, proceeds from sales of Class A shares of the Funds. From these fees, NFD pays sales commissions, salaries and other expenses in connection with generating new sales of Class A shares of the Funds. The Funds Class A sales charges ranged from 0.00% to 5.75% based on the amount of the purchase. For the period from September 16, 2013 through July 31, 2014, the Funds imposed front-end sales charges of $931,578. For the period from August 1, 2013 through September 15, 2013, the Predecessor Funds imposed front-end sales charges of $84,246.
207
Notes to Financial Statements (Continued)
July 31, 2014
Effective September 16, 2013, NFD also receives fees in the form of contingent deferred sales charges (CDSCs) on Class A and Class C shares. Any CDSC is based on the original purchase price or the current market value of the shares being redeemed, whichever is less. A CDSC is imposed on Class A shares for certain redemptions, and Class C shares made within 1 year of purchase. Class A CDSCs were 1.00% for the Funds. Class C CDSCs were 1.00% for the Funds. For the period from September 16, 2013 through July 31, 2014, the Funds imposed CDSCs of $9,297. For the period from August 1, 2013 through September 15, 2013, the Predecessor Funds imposed CDSCs of $1,760.
Effective September 16, 2013, under the terms of an Administrative Services Plan, the Funds pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions that agree to provide administrative support services to the shareholders of certain classes. These services may include, but are not limited to, the following: (i) establishing and maintaining shareholder accounts; (ii) processing purchase and redemption transactions; (iii) arranging bank wires; (iv) performing shareholder sub-accounting; (v) answering inquiries regarding the Funds; and (vi) other such services. These fees are calculated at an annual rate of up to 0.25% of the average daily net assets of Class A and Institutional Service Class shares of each Fund. Effective March 1, 2014, Class C shares began charging administrative servicing fees. These fees are calculated at an annual rate of up to 0.25% of the average daily net assets of Class C shares of the Funds. A Fund may retain all or a portion of the sales charges.
Prior to September 16, 2013, HighMark had similar administrative servicing plans permitting payment of compensation to service providers, which may have included HighMark or its affiliates that had agreed to provide certain shareholder support services for its customers who owned Fiduciary, Class A or Class B Shares. In consideration for such services, a service provider was entitled to receive compensation at the annual rate of up to 0.25% of the average daily net assets of the applicable class of shares of the Funds. The service providers had agreed to waive a portion of their fees for certain classes of all Funds for the period from August 1, 2013 through September 15, 2013. The administrative servicing fee waivers by HighMark, or its affiliates, were voluntary and not subject to recoupment.
For the year ended July 31, 2014, the effective rates for administrative services fees net of waivers were as follows:
Fund | Class A | Class B (a) | Class C | Institutional Service Class (b) |
||||||||||||
Cognitive Value |
0.11 | % | N/A | | % | 0.13 | % | |||||||||
International Equities |
0.13 | N/A | 0.04 | 0.13 | ||||||||||||
Technology & Science |
0.14 | N/A | 0.06 | 0.18 | ||||||||||||
Mid Cap Growth |
0.16 | 0.25 | % | 0.03 | 0.14 | |||||||||||
Small Cap Growth |
0.13 | N/A | 0.03 | 0.09 | ||||||||||||
Balanced |
0.09 | 0.26 | 0.02 | 0.17 | ||||||||||||
Large Cap Core Equity |
0.13 | N/A | 0.03 | 0.09 | ||||||||||||
Large Cap Growth |
0.10 | 0.25 | 0.02 | 0.14 | ||||||||||||
Small Cap Core |
0.10 | N/A | 0.03 | 0.08 | ||||||||||||
Value |
0.14 | 0.25 | 0.02 | 0.14 | ||||||||||||
Equity Income |
0.09 | 0.25 | 0.03 | 0.14 | ||||||||||||
NYSE Arca Tech 100 Index |
0.12 | 0.25 | 0.03 | 0.13 |
(a) | For the period August 1, 2013 through September 15, 2013. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
N/A Not Applicable.
Amounts designated as are zero or have been rounded to zero.
208
Notes to Financial Statements (Continued)
July 31, 2014
During the period from September 16, 2013 through July 31, 2014, the effective rates for administrative services fees that NFS earned were as follows:
Fund | Class A | Class C | Institutional Service Class |
|||||||||
Cognitive Value |
0.11 | % | | % | 0.12 | % | ||||||
International Equities |
0.14 | 0.04 | 0.12 | |||||||||
Technology & Science |
0.13 | 0.07 | 0.19 | |||||||||
Mid Cap Growth |
0.17 | 0.03 | 0.14 | |||||||||
Small Cap Growth |
0.12 | 0.03 | 0.08 | |||||||||
Balanced |
0.08 | 0.02 | 0.17 | |||||||||
Large Cap Core Equity |
0.13 | 0.04 | 0.08 | |||||||||
Large Cap Growth |
0.09 | 0.02 | 0.13 | |||||||||
Small Cap Core |
0.09 | 0.03 | 0.08 | |||||||||
Value |
0.13 | 0.03 | 0.14 | |||||||||
Equity Income |
0.08 | 0.03 | 0.14 | |||||||||
NYSE Arca Tech 100 Index |
0.11 | 0.04 | 0.13 |
Amount designated as is zero or has been rounded to zero.
For the period from September 16, 2013 through July 31, 2014, NFS earned the following amounts in administrative services fees from each Fund:
Fund | Amount | |||
Cognitive Value |
$ | 2,745 | ||
International Equities |
85,865 | |||
Technology & Science |
4,539 | |||
Mid Cap Growth |
1,856,733 | |||
Small Cap Growth |
106,672 | |||
Balanced |
29,838 | |||
Large Cap Core Equity |
46,072 | |||
Large Cap Growth |
71,764 | |||
Small Cap Core |
53,284 | |||
Value |
253,286 | |||
Equity Income |
28,520 | |||
NYSE Arca Tech 100 Index |
272,119 |
209
Notes to Financial Statements (Continued)
July 31, 2014
For the period from August 1, 2013 through September 15, 2013, HighMark, or its affiliates earned the following amounts in administrative servicing fees, net of waivers, from each Fund:
Fund | Amount | |||
Cognitive Value |
$ | 564 | ||
International Equities |
11,863 | |||
Technology & Science |
573 | |||
Mid Cap Growth |
247,359 | |||
Small Cap Growth |
18,877 | |||
Balanced |
5,387 | |||
Large Cap Core Equity |
11,066 | |||
Large Cap Growth |
13,112 | |||
Small Cap Core |
12,857 | |||
Value |
41,308 | |||
Equity Income |
5,522 | |||
NYSE Arca Tech 100 Index |
44,140 |
As of July 31, 2014, NFA or its affiliates directly held the percentage indicated below of the shares outstanding of the applicable Fund.
Fund | % of Shares Outstanding Owned |
|||
Cognitive Value |
0.01 | % | ||
International Equities |
| |||
Technology & Science |
0.01 | |||
Mid Cap Growth |
| |||
Small Cap Growth |
| |||
Balanced |
0.03 | |||
Large Cap Core Equity |
0.02 | |||
Large Cap Growth |
0.02 | |||
Small Cap Core |
0.01 | |||
Value |
| |||
Equity Income |
88.39 | |||
NYSE Arca Tech 100 Index |
|
Amounts designated as are zero or have been rounded to zero.
4. Redemption Fees
Effective September 16, 2013, the Funds do not impose redemption fees.
Prior to September 16, 2013, certain of the Funds imposed 2.00% redemption and exchange fees 30 days or less after purchase, and were designed to discourage short-term trading. A Funds redemption fees are allocated to all classes in that Fund based on relative net assets and are included in proceeds from shares issued on the Statements of Changes in Net Assets. For the period from August 1, 2013 through September 15, 2013, Cognitive Value imposed redemption fees of $3.
For the year ended July 31, 2013, Cognitive Value, International Equities, Small Cap Growth, and Small Cap Core received redemption fees of $801, $124, $1,503 and $192, respectively.
210
Notes to Financial Statements (Continued)
July 31, 2014
5. Line of Credit and Earnings Credit
Effective July 17, 2014, the Funds have been added to the Trust and Nationwide Variable Insurance Trust (together, the Trusts) renewed credit agreement with JPMorgan, The Bank of New York Mellon, and Wells Fargo Bank National Association, permitting the Trusts, in the aggregate, to borrow up to $100,000,000. Advances taken by a Fund under this arrangement would be primarily for temporary or emergency purposes, including the meeting of redemption requests that otherwise might require the untimely disposition of securities, and are subject to the Funds borrowing restrictions. The line of credit requires a commitment fee of 0.07% per year on $100,000,000. Borrowings under this arrangement bear interest at a rate of 1.00% per annum plus the higher of (a) the one month London Interbank Offered Rate or (b) the Federal Funds Rate. Interest costs, if any, would be shown on the Statement of Operations. No compensating balances are required under the terms of the line of credit. In addition, a Fund may not draw on any portion of the line of credit that is provided by a bank that is an affiliate of the Funds subadviser, if applicable. The line of credit is renewed annually, and next expires on July 16, 2015. There were no borrowings under the line of credit during the year ended July 31, 2014.
JPMorgan provides earnings credits for cash balances maintained in the Funds custody accounts, which are used to offset custody fees of a Fund.
6. Investment Transactions
For the year ended July 31, 2014, purchases of and sales of securities (excluding short-term securities) were as follows:
Fund | Purchases | Sales | ||||||
Cognitive Value |
$ | 296,806,807 | $ | 300,329,214 | ||||
International Equities |
223,955,836 | 200,966,242 | ||||||
Technology & Science |
36,255,935 | 45,222,435 | ||||||
Mid Cap Growth |
471,129,602 | 500,605,795 | ||||||
Small Cap Growth |
68,042,073 | 36,542,871 | ||||||
Balanced |
15,566,561 | 17,529,390 | ||||||
Large Cap Core Equity |
28,186,360 | 34,041,451 | ||||||
Large Cap Growth |
27,795,384 | 49,538,440 | ||||||
Small Cap Core |
38,986,243 | 38,402,739 | ||||||
Value |
198,144,805 | 246,534,532 | ||||||
Equity Income |
376,037,663 | 79,577,717 | ||||||
NYSE Arca Tech 100 Index |
59,611,178 | 61,639,657 |
For the year ended July 31, 2014, purchases and sales of U.S. Government securities were as follows:
Fund | Purchases | Sales | ||||||
Balanced |
$ | 2,354,536 | $ | 3,971,695 |
7. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies
Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include foreign currency fluctuations, future disruptive political and economic developments and the possible imposition of exchange controls or other unfavorable foreign government laws and restrictions. In addition, investments in certain countries may carry risks of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments that adversely affect investments in those countries.
211
Notes to Financial Statements (Continued)
July 31, 2014
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers in industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
Risks Associated with REIT and Real Estate Investments
Investments in REITs and in real estate securities carry certain risks associated with direct ownership of real estate and with the real estate industry in general. These risks include possible declines in the value of real estate, possible lack of availability of mortgage funds, unexpected vacancies of properties, and the relative lack of liquidity associated with investments in real estate.
Risks Associated with Interest Rates
Prices of fixed-income securities generally increase when interest rates decline and decrease when interest rates increase. Prices of longer-term securities generally change more in response to interest rate changes than prices of shorter term securities. To the extent the Fund invests a substantial portion of its assets in fixed-income securities with longer-term maturities, rising interest rates are more likely to cause the value of the Funds investments to decline significantly.
Other
The Trust invests through an omnibus account at BBH cash collateral received from securities lending on a daily basis in the Fidelity Institutional Money Market Fund, Institutional Class. As with investments in any money market fund, the Trusts investments of cash in the Fidelity Institutional Money Market Fund, Institutional Class are neither guaranteed nor insured, and shares of the Fidelity Institutional Money Market Fund, Institutional Class may decline in value, causing losses to the Trust.
8. Indemnifications
Under the Trusts organizational documents, the Trusts Officers and Trustees are indemnified by the Trust against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into indemnification agreements with its Trustees and certain of its Officers. Trust Officers receive no compensation from the Trust for serving as its Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trusts maximum liability under these arrangements is unknown, as this would involve future claims made against the Trust. Based on experience, however, the Trust expects the risk of loss to be remote.
9. New Accounting Pronouncements
In June 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-11: Repurchase-to-Maturity Transactions, Repurchase Financing, and Disclosures (ASU 2014-11). The FASB issued ASU 2014-11 to improve the financial reporting of repurchase agreements and other similar transactions. ASU 2014-11 changes the accounting for repurchase-to-maturity transactions and repurchase financing arrangements and requires enhanced disclosures about repurchase agreements and other similar transactions. ASU 2014-11 will take effect for funds with fiscal years beginning after December 15, 2014. Management is currently evaluating the impact ASU 2014-11 will have on the Funds financial statement disclosures.
212
Notes to Financial Statements (Continued)
July 31, 2014
10. Other
As of July 31, 2014, the Funds had individual shareholder accounts and/or omnibus shareholder accounts (comprising a group of individual shareholders), which held more than 10% of the total shares outstanding of the Funds as detailed below.
Fund | % of Shares | Number of Accounts | ||||||
Cognitive Value |
59.32 | % | 2 | |||||
International Equities |
64.58 | 3 | ||||||
Technology & Science |
66.86 | 2 | ||||||
Mid Cap Growth |
43.88 | 3 | ||||||
Small Cap Growth |
48.25 | 3 | ||||||
Balanced |
61.02 | 3 | ||||||
Large Cap Core Equity |
73.75 | 2 | ||||||
Large Cap Growth |
60.18 | 3 | ||||||
Small Cap Core |
60.51 | 2 | ||||||
Value |
61.25 | 3 | ||||||
Equity Income |
29.80 | 2 | (a) | |||||
NYSE Arca Tech 100 Index |
46.87 | 3 |
(a) | Each such account is the account of an affiliated fund. |
11. Recaptured Brokerage Commissions
The Funds have entered into agreements with brokers whereby the brokers will return a portion of a Funds brokerage commissions on the Funds behalf. Such amounts, under such agreements, are included in net realized gain/(loss) on the sale of investments presented in a Funds Statement of Operations. For the period from September 16, 2013 through July 31, 2014, the Funds recaptured the following amounts of brokerage commissions:
Fund | Amount | |||
Cognitive Value |
$ | | ||
International Equities |
| |||
Technology & Science |
| |||
Mid Cap Growth |
56,286 | |||
Small Cap Growth |
23,885 | |||
Balanced |
1,385 | |||
Large Cap Core Equity |
5,187 | |||
Large Cap Growth |
6,485 | |||
Small Cap Core |
13,174 | |||
Value |
58,047 | |||
Equity Income |
68,368 | |||
NYSE Arca Tech 100 Index |
5,588 |
Amounts designated as are zero or have been rounded to zero.
12. Reorganization
Each Fund commenced operation on September 16, 2013 as a result of a tax free reorganization in which Cognitive Value, International Equities, Technology & Science, Mid Cap Growth, Small Cap Growth, Balanced, Large Cap Core Equity, Large Cap Growth, Small Cap Core, Value, Equity Income, and NYSE Arca Tech 100 Index acquired all of the
213
Notes to Financial Statements (Continued)
July 31, 2014
assets, subject to all liabilities and obligations of the HighMark Cognitive Value Fund, HighMark International Opportunities Fund, HighMark Enhanced Growth Fund, HighMark Geneva Mid Cap Growth Fund, HighMark Geneva Small Cap Growth Fund, HighMark Balanced Fund, HighMark Large Cap Core Equity Fund, HighMark Large Cap Growth Fund, HighMark Small Cap Core Fund, HighMark Value Fund, HighMark Equity Income Fund, and HighMark NYSE Arca Tech 100 Index Fund, respectively, each a former series of HighMark Funds (each a Predecessor Fund, and collectively the Predecessor Funds). Class A, Class B, Class C, Class M, Class U and Fiduciary shareholders of each Predecessor Fund received Class A, Class B, Class C, Class M, Class U and Institutional Service Class shares, respectively, of the corresponding Funds with an aggregate share net asset value equal to the aggregate share net asset value of their shares in the respective Predecessor Funds immediately prior to the reorganization. Each Funds reorganization was treated as a tax-free reorganization for federal income tax purposes and, accordingly, the basis of the assets of each Fund reflects the historical basis of the assets of the corresponding Predecessor Fund as of the date of the reorganization. For financial reporting purposes, each Predecessor Funds operating history prior to the reorganization is reflected in the corresponding Nationwide Funds financial statements and financial highlights.
The reorganization was accomplished by the following tax-free exchange in which each shareholder of the Predecessor Fund received the same aggregate share net asset value in the corresponding Fund as noted below:
Fund/Class | Shares | Value | ||||||
Cognitive Value |
||||||||
Class A |
79,122 | $ | 1,160,869 | |||||
Class C |
38,504 | 548,477 | ||||||
Class M |
6,178,315 | 90,565,455 | ||||||
Institutional Service Class* |
123,558 | 1,810,376 | ||||||
International Equities |
||||||||
Class A |
552,960 | 4,230,036 | ||||||
Class C |
163,235 | 1,239,920 | ||||||
Class M |
20,228,917 | 154,593,432 | ||||||
Institutional Service Class* |
8,207,651 | 62,668,697 | ||||||
Technology & Science |
||||||||
Class A |
115,935 | 1,609,414 | ||||||
Class C |
30,615 | 407,158 | ||||||
Class M |
6,212,912 | 88,795,564 | ||||||
Institutional Service Class* |
98,988 | 1,411,690 | ||||||
Mid Cap Growth |
||||||||
Class A |
16,855,620 | 486,466,686 | ||||||
Class B** |
77,898 | 2,015,420 | ||||||
Class C |
3,789,488 | 99,286,490 | ||||||
Institutional Service Class* |
29,120,415 | 850,380,173 | ||||||
Small Cap Growth |
||||||||
Class A |
618,599 | 25,816,384 | ||||||
Class C |
315,334 | 12,816,312 | ||||||
Institutional Service Class* |
1,854,739 | 78,316,905 | ||||||
Balanced |
||||||||
Class A |
737,766 | 11,611,484 | ||||||
Class B** |
964 | 15,113 | ||||||
Class C |
317,473 | 4,960,134 | ||||||
Institutional Service Class* |
1,087,608 | 17,164,629 |
214
Notes to Financial Statements (Continued)
July 31, 2014
Fund/Class | Shares | Value | ||||||
Large Cap Core Equity |
||||||||
Class A |
864,698 | $ | 9,866,895 | |||||
Class C |
88,963 | 986,061 | ||||||
Institutional Service Class* |
4,076,059 | 46,641,531 | ||||||
Large Cap Growth |
||||||||
Class A |
1,307,603 | 16,687,369 | ||||||
Class B** |
35,603 | 420,647 | ||||||
Class C |
237,559 | 2,780,058 | ||||||
Institutional Service Class* |
3,946,704 | 51,337,939 | ||||||
Small Cap Core |
||||||||
Class A |
448,487 | 11,344,436 | ||||||
Class C |
179,874 | 4,387,651 | ||||||
Institutional Service Class* |
2,146,106 | 55,026,803 | ||||||
Value |
||||||||
Class A |
4,833,319 | 88,889,092 | ||||||
Class B** |
45,886 | 822,074 | ||||||
Class C |
213,293 | 3,800,477 | ||||||
Class U |
6,759,747 | 124,831,564 | ||||||
Institutional Service Class* |
6,788,513 | 125,287,440 | ||||||
Equity Income |
||||||||
Class A |
1,623,257 | 19,191,933 | ||||||
Class B** |
85,852 | 1,017,947 | ||||||
Class C |
426,237 | 5,007,174 | ||||||
Institutional Service Class* |
692,778 | 8,219,255 | ||||||
NYSE Arca Tech 100 Index |
||||||||
Class A |
4,822,175 | 214,618,126 | ||||||
Class B** |
63,898 | 2,546,789 | ||||||
Class C |
349,669 | 14,192,831 | ||||||
Institutional Service Class* |
423,576 | 19,044,498 |
* | Effective September 16, 2013, Fiduciary shares were renamed Institutional Service Class Shares. |
** Effective September 16, 2013, Class B Shares were converted into Class A Shares. See Statements of Changes in Net Assets for additional information.
13. Federal Tax Information
The tax character of distributions paid during the year ended July 31, 2014 was as follows:
Distributions paid from | ||||||||||||||||||||
Fund | Ordinary Income* |
Net Long-Term Capital Gains |
Total Taxable Distributions |
Return of Capital |
Total Distributions Paid |
|||||||||||||||
Cognitive Value |
$ | 13,491,147 | $ | 8,459,332 | $ | 21,950,479 | $ | | $ | 21,950,479 | ||||||||||
International Equities |
5,269,320 | | 5,269,320 | | 5,269,320 | |||||||||||||||
Technology & Science |
202,180 | | 202,180 | | 202,180 |
215
Notes to Financial Statements (Continued)
July 31, 2014
Distributions paid from | ||||||||||||||||||||
Fund | Ordinary Income* |
Net Long-Term Capital Gains |
Total Taxable Distributions |
Return of Capital |
Total Distributions Paid |
|||||||||||||||
Mid Cap Growth |
| 77,070,924 | 77,070,924 | | 77,070,924 | |||||||||||||||
Small Cap Growth |
538,446 | 3,615,919 | 4,154,365 | | 4,154,365 | |||||||||||||||
Balanced |
247,056 | 2,455,162 | 2,702,218 | | 2,702,218 | |||||||||||||||
Large Cap Core Equity |
291,547 | | 291,547 | | 291,547 | |||||||||||||||
Large Cap Growth |
605,246 | 736,508 | 1,341,754 | | 1,341,754 | |||||||||||||||
Small Cap Core |
| | | | | |||||||||||||||
Value |
17,231,369 | 51,372,981 | 68,604,350 | | 68,604,350 | |||||||||||||||
Equity Income |
2,693,194 | | 2,693,194 | | 2,693,194 | |||||||||||||||
NYSE Arca Tech 100 Index |
811,326 | | 811,326 | | 811,326 |
Amounts designated as are zero or have been rounded to zero.
* | Ordinary income amounts include net short-term capital gains, if any. |
The tax character of distributions paid during the year ended July 31, 2013 was as follows:
Fund | Ordinary Income* |
Net Long-Term Capital Gains |
Total Taxable Distributions |
Return of Capital |
Total Distributions Paid |
|||||||||||||||
Cognitive Value |
$ | 1,017,845 | $ | | $ | 1,017,845 | $ | | $ | 1,017,845 | ||||||||||
International Equities |
3,880,950 | | 3,880,950 | | 3,880,950 | |||||||||||||||
Technology & Science |
| | | | | |||||||||||||||
Mid Cap Growth |
| 18,413,894 | 18,413,894 | | 18,413,894 | |||||||||||||||
Small Cap Growth |
| 2,444,342 | 2,444,342 | | 2,444,342 | |||||||||||||||
Balanced |
361,070 | 703,108 | 1,064,178 | | 1,064,178 | |||||||||||||||
Large Cap Core Equity |
835,360 | | 835,360 | | 835,360 | |||||||||||||||
Large Cap Growth |
301,369 | | 301,369 | | 301,369 | |||||||||||||||
Small Cap Core |
18,837 | | 18,837 | | 18,837 | |||||||||||||||
Value |
4,255,122 | 28,131,157 | 32,386,279 | | 32,386,279 | |||||||||||||||
Equity Income |
592,414 | | 592,414 | | 592,414 | |||||||||||||||
NYSE Arca Tech 100 Index |
271,184 | | 271,184 | | 271,184 |
Amounts designated as are zero or have been rounded to zero.
* | Ordinary income amounts include net short-term capital gains, if any. |
As of July 31, 2014, the components of accumulated earnings/(deficit) on a tax basis were as follows:
Fund | Undistributed Ordinary Income |
Undistributed Long-Term Capital Gains |
Accumulated Earnings |
Distributions Payable |
Accumulated Capital and Other Losses |
Unrealized Appreciation/ (Depreciation)* |
Total Accumulated Earnings (Deficit) |
|||||||||||||||||||||
Cognitive Value |
$ | 6,687,543 | $ | 1,109,495 | $ | 7,797,038 | $ | | $ | | $ | 5,376,942 | $ | 13,173,980 | ||||||||||||||
International Equities |
7,154,301 | | 7,154,301 | | (24,043,304 | ) | 40,446,133 | 23,557,130 | ||||||||||||||||||||
Technology & Science |
12,056 | 5,559,376 | 5,571,432 | | | 45,387,535 | 50,958,967 | |||||||||||||||||||||
Mid Cap Growth |
| 107,950,517 | 107,950,517 | | (5,426,589 | ) | 279,537,184 | 382,061,112 | ||||||||||||||||||||
Small Cap Growth |
| 6,824,927 | 6,824,927 | | (911,073 | ) | 15,369,649 | 21,283,503 | ||||||||||||||||||||
Balanced |
41,563 | 1,308,823 | 1,350,386 | | | 4,481,505 | 5,831,891 |
216
Notes to Financial Statements (Continued)
July 31, 2014
Fund | Undistributed Ordinary Income |
Undistributed Long-Term Capital Gains |
Accumulated Earnings |
Distributions Payable |
Accumulated Capital and Other Losses |
Unrealized Appreciation/ (Depreciation)* |
Total Accumulated Earnings (Deficit) |
|||||||||||||||||||||
Large Cap Core Equity |
264,787 | 447,547 | 712,334 | | | 13,189,506 | 13,901,840 | |||||||||||||||||||||
Large Cap Growth |
521,691 | 11,363,369 | 11,885,060 | | | 13,584,394 | 25,469,454 | |||||||||||||||||||||
Small Cap Core |
| | | | (15,802,896 | ) | 16,597,474 | 794,578 | ||||||||||||||||||||
Value |
3,843,809 | 28,425,090 | 32,268,899 | | (6,768,814 | ) | 39,544,585 | 65,044,670 | ||||||||||||||||||||
Equity Income |
1,909,569 | 2,394,639 | 4,304,208 | | (3,568,924 | ) | 20,173,720 | 20,909,004 | ||||||||||||||||||||
NYSE Arca Tech 100 Index |
457,748 | | 457,748 | | (64,188,848 | ) | 130,207,763 | 66,476,663 |
Amounts designated as are zero or have rounded to zero.
* | The difference between book-basis and tax-basis unrealized appreciation/(depreciation) is primarily attributable to timing differences in recognizing certain gains and losses on investment transactions and mark to market on Passive Foreign Investment Companies. |
As of July 31, 2014, the tax cost of securities (excluding derivative contracts) and the breakdown of unrealized appreciation/(depreciation) was as follows:
Fund | Tax Cost of Securities |
Unrealized Appreciation |
Unrealized Depreciation |
Net Unrealized Appreciation/ (Depreciation) |
||||||||||||
Cognitive Value |
$ | 101,222,286 | $ | 7,631,765 | $ | (2,254,823 | ) | $ | 5,376,942 | |||||||
International Equities |
222,837,419 | 45,832,342 | (5,302,823 | ) | 40,529,519 | |||||||||||
Technology & Science |
54,788,127 | 46,711,114 | (1,323,579 | ) | 45,387,535 | |||||||||||
Mid Cap Growth |
1,180,588,762 | 322,338,157 | (42,800,973 | ) | 279,537,184 | |||||||||||
Small Cap Growth |
122,217,143 | 22,338,454 | (6,968,805 | ) | 15,369,649 | |||||||||||
Balanced |
26,590,649 | 4,692,175 | (210,670 | ) | 4,481,505 | |||||||||||
Large Cap Core Equity |
48,087,151 | 13,716,257 | (526,751 | ) | 13,189,506 | |||||||||||
Large Cap Growth |
45,242,087 | 13,820,176 | (235,782 | ) | 13,584,394 | |||||||||||
Small Cap Core |
66,184,866 | 18,887,621 | (2,290,147 | ) | 16,597,474 | |||||||||||
Value |
301,475,267 | 44,946,325 | (5,401,813 | ) | 39,544,512 | |||||||||||
Equity Income |
327,268,989 | 25,080,902 | (4,907,182 | ) | 20,173,720 | |||||||||||
NYSE Arca Tech 100 Index |
165,176,254 | 133,988,469 | (3,780,706 | ) | 130,207,763 |
As of July 31, 2014, for federal income tax purposes, the Funds have capital loss carryforwards available to offset capital gains, if any, to the extent provided by the U.S. Treasury regulations and in any given year may be limited due to large shareholder redemptions or contributions. Any unlimited losses will be required to be utilized prior to the losses which have an expiration date.
The following table represents capital loss carryforwards with the year the amounts will expire if not utilized to offset future capital gains.
Fund | Amount | Expires | ||||||
International Equities |
$ | 24,043,304 | 2018 | |||||
Small Cap Core |
10,357,345 | 2017 | ||||||
Small Cap Core* |
5,197,714 | 2018 | ||||||
Value* |
282,340 | 2016 | ||||||
Value* |
6,486,474 | 2017 |
217
Notes to Financial Statements (Continued)
July 31, 2014
Fund | Amount | Expires | ||||||
Equity Income* |
1,233,864 | 2016 | ||||||
Equity Income* |
2,080,597 | 2017 | ||||||
Equity Income* |
254,463 | 2018 | ||||||
NYSE Arca Tech 100 Index |
32,909,542 | 2015 | ||||||
NYSE Arca Tech 100 Index |
14,282,341 | 2016 | ||||||
NYSE Arca Tech 100 Index |
16,996,965 | 2017 |
* | A portion of the Funds capital loss carryforward is subject to an annual limitation under the Internal Revenue Code and related regulations. |
During the year ended July 31, 2014, the Funds had capital loss carryforwards that were utilized or expired, and are no longer eligible to offset future capital gains, if any, in the amounts listed below.
Fund | Utilized | Expired | ||||||
International Equities |
$ | 18,873,864 | $ | | ||||
Technology & Science |
5,871,414 | | ||||||
Large Cap Core Equity |
6,422,971 | | ||||||
Small Cap Core |
8,829,935 | | ||||||
Value |
2,444,498 | | ||||||
Equity Income |
1,744,542 | 1,741,439 | ||||||
NYSE Arca Tech 100 Index |
8,217,583 | |
Amounts designated as are zero or have rounded to zero.
The Funds have elected to defer late-year losses in accordance with the Federal tax rules. These losses are treated as having arisen on the first day of the following fiscal year. For the year ended July 31, 2014, the Funds have elected to defer late year losses in the amounts listed below.
Fund | Post-October Capital Loss |
Late Year Ordinary Loss |
||||||
Mid Cap Growth |
$ | | $ | 5,426,589 | ||||
Small Cap Growth |
| 911,073 | ||||||
Small Cap Core |
| 247,837 |
Amounts designated as are zero or have rounded to zero.
14. Subsequent Events
Management has evaluated the impact of subsequent events on the Funds and has determined that there are no subsequent events requiring recognition or disclosure in the financial statements.
218
Report of Independent Registered Public Accounting Firm
To the Board of Trustees and Shareholders of Nationwide Mutual Funds:
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 Nationwide Bailard Cognitive Value Fund, Nationwide Bailard International Equities Fund, Nationwide Bailard Technology & Science Fund, Nationwide Geneva Mid Cap Growth Fund, Nationwide Geneva Small Cap Growth Fund, Nationwide HighMark Balanced Fund, Nationwide HighMark Large Cap Core Equity Fund, Nationwide HighMark Large Cap Growth Fund, Nationwide HighMark Small Cap Core Fund, Nationwide HighMark Value Fund, Nationwide Ziegler Equity Income Fund, and Nationwide Ziegler NYSE Arca Tech 100 Index Fund (twelve of the series of Nationwide Mutual Funds, formerly HighMark Cognitive Value Fund, HighMark International Opportunities Fund, HighMark Enhanced Growth Fund, HighMark Geneva Mid Cap Growth Fund, HighMark Geneva Small Cap Growth Fund, HighMark Balanced Fund, HighMark Large Cap Core Equity Fund, HighMark Large Cap Growth Fund, HighMark Small Cap Core Fund, HighMark Value Fund, HighMark Equity Income Fund, and HighMark NYSE Arca Tech 100 Index Fund, hereafter referred to as the Funds) at July 31, 2014, the results of each of their operations, the changes in each of their net assets and the financial highlights for the year then ended, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as financial statements) are the responsibility of the Funds management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with 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 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 July 31, 2014 by correspondence with the custodian, brokers and underlying funds transfer agent, provide a reasonable basis for our opinion. The statements of changes in net assets presented for the year ended July 31, 2013 and the financial highlights presented for the year ended July 31, 2013 or prior were audited by another independent registered public accounting firm whose report dated September 25, 2013 expressed an unqualified opinion on those statements and financial highlights.
/s/PricewaterhouseCoopers LLP
Philadelphia, Pennsylvania
September 24, 2014
219
July 31, 2014 (Unaudited)
Other Federal Tax Information
For the year ended July 31, 2014, certain dividends paid by the Funds may be subject to a maximum tax rate of 20% as provided for by the Jobs and Growth Tax Relief Reconciliation Act of 2003. The Funds intend to designate the maximum amount allowable as taxed at a maximum rate of 15%. Complete information will be reported in conjunction with your 2014 Form 1099-DIV.
For the taxable year ended July 31, 2014, the following percentages of income dividends paid by the Funds qualify for the dividends received deduction available to corporations:
Fund | Dividends Received Deductions |
|||
Cognitive Value |
24.38 | % | ||
Technology & Science |
100.00 | |||
Small Cap Growth |
100.00 | |||
Balanced |
99.70 | |||
Large Cap Core Equity |
100.00 | |||
Large Cap Growth |
100.00 | |||
Value |
47.05 | |||
Equity Income |
100.00 | |||
NYSE Arca Tech 100 Index |
100.00 |
The Funds designate the following amounts, or the maximum amount allowable under the Internal Revenue Code, as long term capital gain distributions qualifying for the maximum 20% income tax rate for individuals:
Fund | Amount | |||
Cognitive Value |
$ | 8,459,332 | ||
Mid Cap Growth |
77,070,924 | |||
Small Cap Growth |
3,615,919 | |||
Balanced |
2,455,162 | |||
Large Cap Growth |
736,508 | |||
Value |
51,372,981 |
Certain Funds have derived net income from sources within foreign countries. As of July 31, 2014, the foreign source income for each Fund was as follows:
Fund | Amount | Per Share | ||||||
International Equities |
$ | 7,395,552 | $ | 0.1181 |
Certain Funds intend to elect to pass through to shareholders the income tax credit for taxes paid to foreign countries. As of July 31, 2014, the foreign tax credit for each Fund was as follows:
Fund | Amount | Per Share | ||||||
International Equities |
$ | 873,057 | $ | 0.0278 |
220
July 31, 2014
Trustees and Officers of the Trust
The address for each Trustee is: c/o Nationwide Funds Group, 1000 Continental Drive, Suite 400, King of Prussia, PA 19406.
Name and Year of Birth |
Position(s) Held with the Trust and Length of Time Served1,2 |
Principal Occupation(s) During Past Five Years (or longer)3 |
Number of Portfolios in the Nationwide Fund Complex Overseen by Trustee |
Other Directorships Held by Trustee During Past Five Years4 | ||||||
Charles E. Allen 1948 |
Trustee since July 2000 |
Mr. Allen was Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management) from its founding in 1987 to 2012. | 119 | None | ||||||
Paula H.J. Cholmondeley 1947 |
Trustee since July 2000 |
Ms. Cholmondeley focuses full time on corporate governance. She sits on public company boards and is also on the faculty of the National Association of Corporate Directors. She has served as a Chief Executive Officer of Sorrel Group (management consulting company) since January 2004. From April 2000 through December 2003, Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America. | 119 | Director of Dentsply International, Inc. (dental products) from 2002 to present, Ultralife Batteries, Inc. from 2004 to 2010, Albany International Corp. (paper industry) from 2005 to 2013, Terex Corporation (construction equipment) from 2004 to present, and Minerals Technology, Inc. (specialty chemicals) from 2005 to present. | ||||||
Phyllis Kay Dryden 1947 |
Trustee since December 2004 |
Ms. Dryden became CEO and President of Energy Dispute Solutions, LLC in January 2013, leading a company providing strategy consulting, arbitration and mediation services. She has been a management consultant since 1996, first as a partner of Mitchell Madison Group, then as a managing partner and head of west coast business development for marchFIRST, returning to Mitchell Madison Group in 2003 as an associated partner until January 2010 and thereafter as an independent strategy consultant through December 2012. Ms. Dryden was VP and General Counsel of Lucasfilm, Ltd. from 1981 to 1984, SVP and General Counsel of Charles Schwab and Co., Inc. from 1984 to 1992, and EVP and General Counsel of Del Monte Foods from 1992 to 1995. | 119 | None |
221
Management Information (Continued)
July 31, 2014
The address for each Trustee is: c/o Nationwide Funds Group, 1000 Continental Drive, Suite 400, King of Prussia, PA 19406.
Name and Year of Birth |
Position(s) Held with the Trust and Length of Time Served1,2 |
Principal Occupation(s) During Past Five Years (or longer)3 |
Number of Portfolios in the Nationwide Fund Complex Overseen by Trustee |
Other Directorships Held by Trustee During Past Five Years4 | ||||||
Barbara L. Hennigar 1935 |
Trustee since July 2000 |
Ms. Hennigar was Executive Vice President of Oppenheimer Funds (an asset management company) from October 1992 until June 2000; Chairman of Oppenheimer Funds Services from October 1999 until June 2000; and President and CEO of Oppenheimer Funds Services from June 1992 until October 1999. She was previously Board Chair of a non-profit independent school, and is currently an independent trustee and endowment chair of St. Marys Academy, an independent school in Denver, CO. | 119 | None | ||||||
Barbara I. Jacobs 1950 |
Trustee since December 2004 |
Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1988 through 2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 119 | None | ||||||
Keith F. Karlawish 1964 |
Trustee since March 2012 |
Mr. Karlawish has been a partner of Park Ridge Asset Management, LLC since December 2008, at which he also serves as a portfolio manager. From May 2002 until October 2008, Mr. Karlawish was the President of BB&T Asset Management, Inc., and was President of the BB&T Mutual Funds and BB&T Variable Insurance Funds from February 2005 until October 2008. | 119 | Trustee of the BB&T Mutual Funds and BB&T Variable Insurance Funds from June 2006 until December 2008. | ||||||
Carol A. Kosel 1963 |
Trustee since March 2013 |
Ms. Kosel was a consultant to the Evergreen Funds Board of Trustees from October 2005 to December 2007. She was Senior Vice President, Treasurer, and Head of Fund Administration of the Evergreen Funds from April 1997 to October 2005. | 119 | Trustee of Sun Capital Advisers Trust from April 2011 to December 2012 and Trustee of Evergreen Funds from January 2008 to July 2010. | ||||||
Douglas F. Kridler 1955 |
Trustee since September 1997 |
Mr. Kridler is the President and Chief Executive Officer of The Columbus Foundation, a $1.5 billion community foundation with 2,000 funds in 55 Ohio counties and 37 states in the U.S. | 119 | None |
222
Management Information (Continued)
July 31, 2014
The address for each Trustee is: c/o Nationwide Funds Group, 1000 Continental Drive, Suite 400, King of Prussia, PA 19406.
Name and Year of Birth |
Position(s) Held with the Trust and Length of Time Served1,2 |
Principal Occupation(s) During Past Five Years (or longer)3 |
Number of Portfolios in the Nationwide Fund Complex Overseen by Trustee |
Other Directorships Held by Trustee During Past Five Years4 | ||||||
Lydia Micheaux Marshall5 1949 |
Trustee since June 2014 |
Ms. Marshall has been President of LM Marshall, LLC (investment and business consulting company) since 2007. | 119 | Director of Nationwide Corporation since 2001, Nationwide Financial Services, Inc. since 1997, Nationwide Foundation since 2002, Nationwide Life Insurance Company since 2002, Nationwide Life and Annuity Insurance Company since 2002, Nationwide Mutual Fire Insurance Company since 2001, Nationwide Mutual Insurance Company since 2002, and Scottsdale Insurance Company since 2001 (all financial services and insurance companies). Chair and CEO of Versura, Inc. (data processing) since 1999. Director of Seagate Technology (hard disk drive and storage manufacturer) since 2004. Director of Public Welfare Foundation (non-profit foundation) since 2009. |
223
Management Information (Continued)
July 31, 2014
The address for each Trustee is: c/o Nationwide Funds Group, 1000 Continental Drive, Suite 400, King of Prussia, PA 19406.
Name and Year of Birth |
Position(s) Held with the Trust and Length of Time Served1,2 |
Principal Occupation(s) During Past Five Years (or longer)3 |
Number of Portfolios in the Nationwide Fund Complex Overseen by Trustee |
Other Directorships Held by Trustee During Past Five Years4 | ||||||
David C. Wetmore 1948 |
Trustee since 1995 and Chairman since February 2005 | Mr. Wetmore was a Managing Director of Updata Capital, Inc. (a technology-oriented investment banking and venture capital firm) from 1995 through 2000. Prior to 1995, Mr. Wetmore served as the Chief Operating Officer, Chief Executive Officer and Chairman of the Board of several publicly-held software and services companies, and as the managing partner of a big 8 public accounting firm. | 119 | None |
1 | Length of time served includes time served with predecessor of the Trust. |
2 | Each Trustee holds office for the lifetime of the Trust or until such Trustees earlier death, resignation, removal, retirement or inability otherwise to serve, or the election and qualification of his or her successor. |
3 | Unless otherwise noted, the information presented is the principal occupation of the Trustee during the past five years. |
4 | Directorships held in (i) any other investment companies registered under the 1940 Act, (ii) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the Exchange Act) or (iii) any company subject to the requirements of Section 15(d) of the Exchange Act. |
5 | Ms. Marshall is considered an interested person of the Trust because she is a Director of the parent company of, and several affiliates of, the Trusts investment adviser and distributor. |
224
Management Information (Continued)
July 31, 2014
The address for each Officer is: c/o Nationwide Funds Group, 1000 Continental Drive, Suite 400, King of Prussia, PA 19406.
Name and Year of Birth |
Position(s) Held with Fund and Length of Time Served1 |
Principal Occupation(s) During Past Five Years2 | ||
Michael S. Spangler 1966 |
President and Chief Executive Officer since June 2008 | Mr. Spangler is President and Chief Executive Officer of Nationwide Funds Group, which includes NFA3, Nationwide Fund Management LLC3 and Nationwide Fund Distributors LLC3, and is a Senior Vice President of NFS3. From May 2004 through May 2008, Mr. Spangler was Managing Director, Head of Americas Retail and Intermediary Product Management for Morgan Stanley Investment Management. | ||
Stephen T. Grugeon 1950 |
Executive Vice President and Chief Operating Officer since June 2008 |
Mr. Grugeon has been Executive Vice President and Chief Operating Officer of Nationwide Funds Group since May 20073. From February 2008 through June 2008, Mr. Grugeon also served as the acting President and Chief Executive Officer of the Trust and of Nationwide Funds Group. From December 2006 until January 2008, Mr. Grugeon was Executive Vice President of NWD Investments3. | ||
Joseph Finelli 1957 |
Treasurer since September 2007 |
Mr. Finelli is the Principal Financial Officer and Senior Vice President for Nationwide Funds Group3. From July 2001 until September 2007, Mr. Finelli was Assistant Treasurer and Vice President of Investment Accounting and Operations of NWD Investments3. | ||
Brian Hirsch 1956 |
Chief Compliance Officer since January 2012 | Mr. Hirsch is Vice President of NFA and Chief Compliance Officer of NFA and the Trust. From January 2003 through January 2012, Mr. Hirsch was the Senior Vice President for Compliance and Fund Administration at IFS Financial Services, Inc., a subsidiary of the Western Southern Financial Group. | ||
Eric E. Miller 1953 |
Secretary since December 2002 |
Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group and NWD Investments3. | ||
Jennifer Tiffany Grinstead 1976 |
Chief Marketing Officer since March 2014 | Ms. Grinstead is Vice President of Nationwide Funds Marketing for NFS.3 From April 2012 through April 2014, Ms. Grinstead was Assistant Vice President, Life Marketing for NFS.3 From January 2009 through April 2012, Ms. Grinstead was Assistant Vice President, Retirement Plan Marketing for NFS.3 |
1 | Length of time served includes time served with the Trusts predecessors. |
2 | Unless otherwise noted, the information presented is the principal occupation of the Officer during the past five years. |
3 | These positions are held with an affiliated person or principal underwriter of the Funds. |
Additional information regarding the Trustees and Officers may be found in the Trusts Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920.
Federal law requires the Trust and each of its investment advisers and subadvisers to adopt procedures for voting proxies (Proxy Voting Guidelines) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Fund. The Funds proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Trusts website at nationwide.com/mutualfunds, and (iii) on the Securities and Exchange Commissions website at www.sec.gov.
225
Market Index Definitions |
Barclays 7-Year Municipal Bond Index: An unmanaged index that consists of a broad selection of investment-grade general obligation and revenue bonds with maturities of approximately seven years.
Barclays Municipal Bond Index: An unmanaged, market value-weighted index of investment-grade municipal bonds with a minimum credit rating of Baa and maturities of one year or more; serves as a broad market performance index for the tax-exempt bond market.
Barclays U.S. 1-3 Year Government/Credit Bond Index: An unmanaged index of U.S. dollar-denominated, investment-grade, fixed-rate, publicly issued, taxable bond market issues (including Treasury, government and corporate securities) with a remaining maturity of one to three years.
Barclays U.S. Aggregate Bond Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Consumer Price Index (CPI): Calculated by the U.S. Department of Labors Bureau of Labor Statistics, the CPI represents changes in prices of a basket of goods and services purchased for consumption by urban households.
Lipper Analytical Services, Inc. (Lipper) is an industry research firm whose rankings are based on total return performance and do not reflect the effect of sales charges. Each fund is ranked within a universe of funds similar in investment objective as determined by Lipper.
MSCI ACWI ex USA: An unmanaged, market capitalization-weighted index that is designed to measure the performance of the stocks in the global developed and emerging markets, excluding U.S.-based companies.
MSCI EAFE® Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of large-cap and mid-cap stocks in developed markets outside the United States and Canada.
NASDAQ-100 Index: An unmanaged index that includes 100 of the largest domestic and international nonfinancial securities listed on the Nasdaq Stock Market, based on market capitalization.
NYSE Arca Tech 100 Index®: An unmanaged, price-weighted index of at least 100 individual technology-related securities, consisting of stocks of companies from various industries that produce or deploy innovative technologies to conduct their business.
Russell 1000® Growth Index: An unmanaged index that measures the performance of the large-capitalization growth segment of the U.S. equity universe; includes those Russell 1000® Index companies with higher price-to-book ratios and higher forecasted growth values.
Russell 1000® Value Index: An unmanaged index that measures the performance of the large-capitalization value segment of the U.S. equity universe; includes those Russell 1000® Index companies with lower price-to-book ratios and lower forecasted growth values.
Russell 2000® Index: An unmanaged index that measures the performance of the small-capitalization segment of the U.S. equity universe.
Russell 2000® Growth Index: An unmanaged index that measures the performance of the small-capitalization growth segment of the U.S. equity universe; includes those Russell 2000® Index companies with higher price-to-book ratios and higher forecasted growth values.
226
Market Index Definitions (cont.) |
Russell 2000® Value Index: An unmanaged index that measures the performance of the small-capitalization value segment of the U.S. equity universe; includes those Russell 2000® Index companies with lower price-to-book ratios and lower forecasted growth values.
Russell Midcap® Growth Index: An unmanaged index that measures the performance of the mid-capitalization growth segment of the U.S. equity universe; includes those Russell Midcap® Index companies with higher price-to-book ratios and higher forecasted growth values.
Note about Russell Indexes
Russell Investment Group is the source and owner of the trademarks, service marks and copyrights related to the Russell Indexes. Russell® is a trademark of Russell Investment Group.
S&P 500® Index: An unmanaged, market capitalization-weighted index of 500 stocks of leading large-cap U.S. companies in leading industries; gives a broad look at the U.S. equities market and those companies stock price performance.
S&P North American Technology Sector Index: An unmanaged, modified, market capitalization-weighted index that measures the performance of the technology sector of the U.S. equity market.
S&P SmallCap 600® Value Index: An unmanaged index comprising small-capitalization value stocks included in the S&P SmallCap 600® Index. Performance is measured based on the ratios of book value, earnings, and sales to price.
227
Glossary |
Definitions of some commonly used investment terms
Benchmark index: A broad-based securities index used as a comparison tool to measure the performance of a mutual fund.
Coefficient of correlation: a measure that determines the degree to which the movements of two variables are associated.
Derivative: A contract, security or investment with its value based on the performance of an underlying financial asset, index or economic measure.
Duration: A measure of how much the price of a bond would change compared to a change in market interest rates, based on the remaining time until a bonds maturity together with other factors. A bonds value drops when interest rates rise, and vice versa. Bonds with longer durations have higher risk and volatility.
Emerging market countries: Developing and low- or middle-income countries as identified by the International Finance Corporation or the World Bank. Emerging market countries may be found in regions such as Asia, Latin America, Eastern Europe, the Middle East and Africa.
Equity securities: Securities that represent an ownership interest in the issuer. Common stocks are the most common type of equity securities.
Expense ratio: The percentage of fees paid by a fund to its adviser for management and operational costs. A funds expense ratio includes all administrative expenses and 12b-1 fees but excludes sales charges.
Fixed-income securities: Securities, including bonds and other debt securities, that represent an obligation by the issuer to pay a specified rate of interest or dividend at specified times and eventually return the principal at maturity.
Futures: Contracts that obligate the buyer to buy and the seller to sell a specified quantity of an underlying asset (or settle for cash the value of a contract based on the underlying asset) at a specified price on the contracts maturity date.
Growth style: Investing in equity securities of companies that the Funds subadviser believes have above-average rates of earnings growth and which therefore may experience above-average increases in stock price.
High-yield bonds: Fixed-income securities that are rated below investment grade by nationally recognized statistical rating organizations. These bonds generally offer investors higher interest rates as a way to help compensate for the fact that the issuer is at greater risk of default.
Market capitalization: A common way of measuring the size of a company based on the price of its common stock multiplied by the number of outstanding shares.
Preferred stock: A class of stock that often pays dividends at a specified rate and has preference over common stocks in dividend payments and liquidation of assets.
Quantitative techniques: Mathematical and statistical methods used in the investment process to identify securities of issuers for possible purchase or sale by a mutual fund.
228
Glossary (cont.) |
Value style: Investing in equity securities that a funds manager believes are undervalued, i.e., their stock prices are less than the manager believes they are intrinsically worth, based on such factors as a companys stock price relative to its book value, earnings and cash flow.
Yield curve: A plotted graph line showing the interest rates of bonds, at a set point in time, that have equal credit quality but different maturity dates.
229
P.O. Box 701
Milwaukee, WI 53201-0701
nationwide.com/mutualfunds
Call 1-800-848-0920 to request a summary prospectus and/or a prospectus, or download prospectuses at nationwide.com/mutualfunds. These prospectuses outline investment objectives, risks, fees, charges and expenses, and other information that you should read and consider carefully before investing.
About Nationwide Funds Group (NFG)
NFG comprises Nationwide Fund Advisors, Nationwide Fund Distributors LLC and Nationwide Fund Management LLC. Together they provide advisory, distribution and administration services, respectively, to Nationwide Funds. Nationwide Fund Advisors (NFA) is the investment adviser to Nationwide Funds.
Distributor
Nationwide Funds distributed by Nationwide Fund Distributors LLC (NFD), member FINRA, King of Prussia, Pa. NFD is not affiliated with any subadviser contracted by NFA, with the exception of Nationwide Asset Management, LLC (NWAM).
Nationwide, Nationwide Financial, the Nationwide framemark, Nationwide Funds, Nationwide Funds Group and On Your Side are service marks of Nationwide Mutual Insurance Company.
© 2014 Nationwide Funds Group. All rights reserved.
AR-HM-CEQ 9/14
Annual Report
July 31, 2014
Nationwide Mutual Funds
Fixed-Income Funds
Nationwide HighMark Bond Fund
Nationwide HighMark California Intermediate Tax Free Bond Fund
Nationwide HighMark National Intermediate Tax Free Bond Fund
Nationwide HighMark Short Term Bond Fund
Nationwide Ziegler Wisconsin Tax Exempt Fund
Nationwide Funds® |
Commentary in this report is provided by the portfolio manager(s) of each Fund as of the date of this report and is subject to change at any time based on market or other conditions.
Third-party information has been obtained from sources that Nationwide Fund Advisors (NFA), the investment adviser to the Funds, deems reliable. This report and the holdings provided are for informational purposes only and are not intended to be relied on as investment advice. Portfolio composition is accurate as of the date of this report and is subject to change at any time and without notice. NFA, one of its affiliated advisers or its employees may hold a position in the securities in this report.
Statement Regarding Availability of Quarterly Portfolio Holdings.
The Trust files complete schedules of portfolio holdings for each Fund with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year on Form N-Q. Additionally, the Trust files a schedule of portfolio holdings monthly for the Nationwide Money Market Fund on Form N-MFP. Forms N-Q and Forms N-MFP are available on the SECs website at http://www.sec.gov. Forms N-Q and Forms N-MFP may be reviewed and copied at the SECs Public Reference Room in Washington, DC, and information on the operation of the Public Reference Room may be obtained by calling 800-SEC-0330. The Trust also makes this information available to shareholders on nationwide.com/mutualfunds or upon request without charge.
Statement Regarding Availability of Proxy Voting Record.
Information regarding how the Funds voted proxies relating to portfolio securities held during the most recent 12-month period ended June 30 is available without charge, upon request, by calling 800-848-0920, and on the SECs website at http://www.sec.gov.
Nationwide Funds® Annual Report |
Nationwide Funds® |
July 31, 2014
Dear Shareholder,
Watching children board a school bus can teach us a lot about human nature. As the red lights flash and the bus door slides open, some children rush to be first to climb up the steps. Others are hesitant, glancing back for reassurance. A few students freeze in fear, unable to proceed.
We understand that, like the students or anyone facing something daunting, investors vary in their approaches to financial planning. Whether you tend to climb right in, move tentatively or need support to move forward at all, please know that Nationwide Funds represent a range of products and investment strategies designed to suit all types of investors. We continually scan the investment universe seeking opportunities to expand our fund offerings to include potentially attractive asset classes. Our goal is to help provide the investment options you may need to prepare for and live in retirement. As a Nationwide Funds investor, you may be positioned for potential benefits from long-term investment solutions driven by tactical risk management and diversification.
Overall, most Nationwide Funds performed well during the one-year reporting period ended July 31, 2014. Broad U.S. stock market performance as measured by the S&P 500® Index grew 16.94% for the period, with all sectors reporting positive returns. The Barclays U.S. Aggregate Bond Index, a broad measurement of U.S. fixed-income investment performance, returned 3.97% for the one-year period.
Confucius reminds us that Every journey starts with a single step. By working with your financial advisor and investing with Nationwide Funds, you already have climbed that critical first step. We encourage you to stay true to your long-term plan no matter what your circumstances or investment temperament. Your advisor and Nationwide Funds are poised to help.
Sincerely,
Michael S. Spangler
President & CEO
Nationwide Funds
1
Economic Review |
2
Economic Review (cont.) |
3
Fund Commentary | Nationwide HighMark Bond Fund |
4
Fund Commentary (contd) | Nationwide HighMark Bond Fund |
5
Fund Overview | Nationwide HighMark Bond Fund |
| Percentages indicated are based upon net assets as of July 31, 2014. |
| Percentages indicated are based upon total investments as of July 31, 2014. |
6
Fund Performance | Nationwide HighMark Bond Fund |
7
Fund Performance (cont.) | Nationwide HighMark Bond Fund |
Performance of a $10,000 Investment
Investment return and principal value will fluctuate, and when redeemed, shares may be worth more or less than original cost. Past performance is no guarantee of future results and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Investing in mutual funds involves market risk, including loss of principal. Performance returns assume the reinvestment of all distributions.
Comparative performance of $10,000 invested in Institutional Service Class shares of the Nationwide HighMark Bond Fund versus the Barclays U.S. Aggregate Bond Index and the Consumer Price Index (CPI) over the 10-year period ended 7/31/14. Fund performance prior to the Funds inception on 9/16/13 is based on the Funds predecessor fund. Unlike the Fund, the performance for these unmanaged indexes does not reflect any fees, expenses, or sales charges. One cannot invest directly in a market index. A description of the benchmarks can be found on the Market Index Definitions page at the back of this book.
8
Shareholder Expense Example | Nationwide HighMark Bond Fund |
Schedule of Shareholder Expenses
Expense Analysis of a $1,000 Investment
Nationwide HighMark Bond Fund July 31, 2014 |
Beginning Account Value ($) 02/01/14 |
Ending Account Value ($) 07/31/14 |
Expenses Paid During Period ($) 02/01/14 - 07/31/14 |
Expense Ratio During Period (%) 02/01/14 - 07/31/14 | ||||||||
Class A Shares | Actual | (a) | 1,000.00 | 1,020.40 | 4.46 | 0.89 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,020.38 | 4.46 | 0.89 | ||||||||
Class C Shares | Actual | (a) | 1,000.00 | 1,018.00 | 7.05 | 1.41 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,017.80 | 7.05 | 1.41 | ||||||||
Institutional Service Class Shares(c) | Actual | (a) | 1,000.00 | 1,021.00 | 3.46 | 0.69 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,021.37 | 3.46 | 0.69 | ||||||||
Institutional Class Shares | Actual | (a) | 1,000.00 | 1,021.50 | 2.96 | 0.59 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,021.87 | 2.96 | 0.59 |
(a) | Expenses are equal to the Funds annualized expense ratio multiplied by the average account value from February 1, 2014 through July 31, 2014 multiplied to reflect one-half year period. The expense ratio presented represents a six-month, annualized ratio in accordance with Securities and Exchange Commission guidelines. |
(b) | Represents the hypothetical 5% return before expenses. |
(c) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
9
Statement of Investments
July 31, 2014
Nationwide HighMark Bond Fund
10
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Bond Fund (Continued)
11
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Bond Fund (Continued)
12
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Bond Fund (Continued)
13
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Bond Fund (Continued)
14
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Bond Fund (Continued)
(a) | Variable Rate Security. The rate reflected in the Statement of Investments is the rate in effect on July 31, 2014. The maturity date represents the actual maturity date. |
(b) | Rule 144A, Section 4(2), or other security which is restricted as to sale to institutional investors. These securities were deemed liquid pursuant to procedures approved by the Board of Trustees. The aggregate value of these securities at July 31, 2014 was $35,028,223 which represents 7.90% of net assets. |
(c) | See notes to financial statements for tax cost and unrealized appreciation/(depreciation) of securities. |
BV | Private Limited Liability Company |
GO | General Obligation |
LLC | Limited Liability Company |
LP | Limited Partnership |
Ltd. | Limited |
NA | National Association |
NV | Public Traded Company |
RB | Revenue Bond |
REIT | Real Estate Investment Trust |
REMICS | Real Estate Mortgage Investment Conduits |
The accompanying notes are an integral part of these financial statements.
15
Statement of Assets and Liabilities
July 31, 2014
Nationwide HighMark Bond Fund | ||||||
Assets: |
||||||
Investments, at value (cost $437,879,655) |
$ | 445,270,924 | ||||
Cash |
536,912 | |||||
Interest and dividends receivable |
2,910,711 | |||||
Receivable for investments sold |
42,052 | |||||
Receivable for capital shares issued |
445,719 | |||||
Prepaid expenses |
10,899 | |||||
|
|
|||||
Total Assets |
449,217,217 | |||||
|
|
|||||
Liabilities: |
||||||
Payable for investments purchased |
5,358,326 | |||||
Distributions payable |
235,935 | |||||
Payable for capital shares redeemed |
155,737 | |||||
Accrued expenses and other payables: |
||||||
Investment advisory fees |
170,551 | |||||
Fund administration fees |
15,369 | |||||
Distribution fees |
11,567 | |||||
Administrative servicing fees |
61,175 | |||||
Accounting and transfer agent fees |
3,606 | |||||
Trustee fees |
993 | |||||
Custodian fees |
1,254 | |||||
Compliance program costs (Note 3) |
1,070 | |||||
Professional fees |
34,390 | |||||
Printing fees |
2,886 | |||||
Other |
3,967 | |||||
|
|
|||||
Total Liabilities |
6,056,826 | |||||
|
|
|||||
Net Assets |
$ | 443,160,391 | ||||
|
|
|||||
Represented by: |
||||||
Capital |
$ | 432,368,193 | ||||
Accumulated undistributed net investment income |
62,679 | |||||
Accumulated net realized gains from investments |
3,338,250 | |||||
Net unrealized appreciation/(depreciation) from investments |
7,391,269 | |||||
|
|
|||||
Net Assets |
$ | 443,160,391 | ||||
|
|
|||||
Net Assets: |
||||||
Class A Shares |
$ | 28,985,479 | ||||
Class C Shares |
8,293,872 | |||||
Institutional Service Class Shares |
405,870,576 | |||||
Institutional Class Shares |
10,464 | |||||
|
|
|||||
Total |
$ | 443,160,391 | ||||
|
|
|||||
Shares Outstanding (unlimited number of shares authorized): |
||||||
Class A Shares |
2,680,704 | |||||
Class C Shares |
771,521 | |||||
Institutional Service Class Shares |
36,853,095 | |||||
Institutional Class Shares |
950 | |||||
|
|
|||||
Total |
40,306,270 | |||||
|
|
|||||
16
Statement of Assets and Liabilities (Continued)
July 31, 2014
Nationwide HighMark Bond Fund | ||||||
Net asset value and redemption price per share (Net assets by class divided by shares outstanding by class, respectively): |
||||||
Class A Shares (a) |
$ | 10.81 | ||||
Class C Shares (b) |
$ | 10.75 | ||||
Institutional Service Class Shares |
$ | 11.01 | ||||
Institutional Class Shares |
$ | 11.01 | ||||
Maximum offering price per share (100%/(100%-maximum sales charge) of net asset value adjusted to the nearest cent): |
||||||
Class A Shares |
$ | 11.06 | ||||
|
|
|||||
Maximum Sales Charge: |
||||||
Class A Shares |
2.25 | % | ||||
|
|
|||||
(a) | For Class A Shares, the redemption price per share is reduced by 0.50% on sales of shares of original purchases of $250,000 or more or that were not subject to a front-end sales charge made within 18 months of the purchase date. |
(b) | For Class C Shares, the redemption price per share is reduced by 1.00% for shares held less than one year. |
The accompanying notes are an integral part of these financial statements.
17
Statement of Operations
For the Year Ended July 31, 2014
Nationwide HighMark Bond Fund | ||||||
INVESTMENT INCOME: |
||||||
Interest income |
$ | 12,145,127 | ||||
Dividend income |
3,342 | |||||
Income from securities lending (Note 2) |
2,163 | |||||
|
|
|||||
Total Income |
12,150,632 | |||||
|
|
|||||
EXPENSES: |
||||||
Investment advisory fees |
1,670,677 | |||||
Fund administration fees |
225,921 | |||||
Distribution fees Class A |
59,817 | |||||
Distribution fees Class B (a) |
74 | |||||
Distribution fees Class C |
78,987 | |||||
Administrative servicing fees Class A |
21,321 | |||||
Administrative servicing fees Class B (a) |
25 | |||||
Administrative servicing fees Class C |
2,266 | |||||
Administrative servicing fees Institutional Service Class (b) |
362,033 | |||||
Registration and filing fees |
55,728 | |||||
Professional fees |
59,348 | |||||
Printing fees |
23,009 | |||||
Trustee fees |
7,455 | |||||
Custodian fees |
12,576 | |||||
Accounting and transfer agent fees |
18,164 | |||||
Compliance program costs (Note 3) |
1,991 | |||||
Other |
36,777 | |||||
|
|
|||||
Total expenses before earnings credit, fees waived, and expenses reimbursed |
2,636,169 | |||||
|
|
|||||
Earnings credit (Note 4) |
(270 | ) | ||||
Administrative servicing fees voluntarily waived Class A (Note 3) |
(5,835 | ) | ||||
Administrative servicing fees voluntarily waived Institutional Service Class (Note 3) (b) |
(69,913 | ) | ||||
Expenses reimbursed by adviser (Note 3) |
(55,593 | ) | ||||
|
|
|||||
Net Expenses |
2,504,558 | |||||
|
|
|||||
NET INVESTMENT INCOME |
9,646,074 | |||||
|
|
|||||
REALIZED/UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: |
||||||
Net realized gains from investment transactions |
3,762,220 | |||||
Net change in unrealized appreciation/(depreciation) from investments |
(106,155 | ) | ||||
|
|
|||||
Net realized/unrealized gains from investments |
3,656,065 | |||||
|
|
|||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS |
$ | 13,302,139 | ||||
|
|
|||||
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
The accompanying notes are an integral part of these financial statements.
18
Statements of Changes in Net Assets
Nationwide HighMark Bond Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
Operations: |
||||||||||||
Net investment income |
$ | 9,646,074 | $ | 9,849,670 | ||||||||
Net realized gains from investments |
3,762,220 | 9,617,231 | ||||||||||
Net change in unrealized appreciation/(depreciation) from investments |
(106,155 | ) | (20,179,034 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets resulting from operations |
13,302,139 | (712,133 | ) | |||||||||
|
|
|
|
|||||||||
Distributions to Shareholders From: |
||||||||||||
Net investment income: |
||||||||||||
Class A |
(673,434 | ) | (970,780 | ) | ||||||||
Class B (a) |
(125 | ) | (2,623 | ) | ||||||||
Class C |
(251,109 | ) | (388,979 | ) | ||||||||
Institutional Service Class (b) |
(9,068,802 | ) | (9,320,669 | ) | ||||||||
Institutional Class |
(281 | )(c) | | |||||||||
Net realized gains: |
||||||||||||
Class A |
(556,525 | ) | (510,196 | ) | ||||||||
Class B (a) |
| (1,648 | ) | |||||||||
Class C |
(253,730 | ) | (237,798 | ) | ||||||||
Institutional Service Class (b) |
(6,797,971 | ) | (4,233,165 | ) | ||||||||
Institutional Class |
(235 | )(c) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from shareholder distributions |
(17,602,212 | ) | (15,665,858 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
95,855,447 | (18,007,338 | ) | |||||||||
|
|
|
|
|||||||||
Change in net assets |
91,555,374 | (34,385,329 | ) | |||||||||
|
|
|
|
|||||||||
Net Assets: |
||||||||||||
Beginning of year |
351,605,017 | 385,990,346 | ||||||||||
|
|
|
|
|||||||||
End of year |
$ | 443,160,391 | $ | 351,605,017 | ||||||||
|
|
|
|
|||||||||
Accumulated undistributed net investment income at end of year |
$ | 62,679 | $ | 107,557 | ||||||||
|
|
|
|
|||||||||
CAPITAL TRANSACTIONS: |
||||||||||||
Class A Shares (Note 10) |
||||||||||||
Proceeds from shares issued |
$ | 9,888,133 | $ | 5,284,159 | ||||||||
Proceeds from shares issued from class conversion |
77,778 | | ||||||||||
Dividends reinvested |
1,013,374 | 1,175,363 | ||||||||||
Cost of shares redeemed |
(8,214,934 | ) | (23,227,122 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
2,764,351 | (16,767,600 | ) | |||||||||
|
|
|
|
|||||||||
Class B Shares (Note 10) (a) |
||||||||||||
Proceeds from shares issued |
| 4,083 | ||||||||||
Dividends reinvested |
93 | 3,700 | ||||||||||
Cost of shares redeemed in class conversion |
(77,778 | ) | | |||||||||
Cost of shares redeemed |
(459 | ) | (141,856 | ) | ||||||||
|
|
|
|
|||||||||
Total Class B Shares |
(78,144 | ) | (134,073 | ) | ||||||||
|
|
|
|
|||||||||
Class C Shares (Note 10) |
||||||||||||
Proceeds from shares issued |
628,539 | 6,097,969 | ||||||||||
Dividends reinvested |
342,302 | 385,574 | ||||||||||
Cost of shares redeemed |
(7,635,255 | ) | (6,245,598 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
(6,664,414 | ) | 237,945 | |||||||||
|
|
|
|
|||||||||
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(c) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
19
Statements of Changes in Net Assets (Continued)
Nationwide HighMark Bond Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
CAPITAL TRANSACTIONS: (continued) |
||||||||||||
Institutional Service Class Shares (Note 10) (b) |
||||||||||||
Proceeds from shares issued |
$ | 150,835,359 | $ | 77,556,706 | ||||||||
Dividends reinvested |
11,684,162 | 9,435,633 | ||||||||||
Cost of shares redeemed |
(62,696,383 | ) | (88,335,949 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
99,823,138 | (1,343,610 | ) | |||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Proceeds from shares issued |
10,000 | (c) | | |||||||||
Dividends reinvested |
516 | (c) | | |||||||||
Cost of shares redeemed |
| (c) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
10,516 | (c) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
$ | 95,855,447 | $ | (18,007,338 | ) | |||||||
|
|
|
|
|||||||||
SHARE TRANSACTIONS: |
||||||||||||
Class A Shares (Note 10) |
||||||||||||
Issued |
913,616 | 465,233 | ||||||||||
Issued in class conversion |
7,204 | | ||||||||||
Reinvested |
94,327 | 103,825 | ||||||||||
Redeemed |
(759,076 | ) | (2,053,587 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
256,071 | (1,484,529 | ) | |||||||||
|
|
|
|
|||||||||
Class B Shares (Note 10) (a) |
||||||||||||
Issued |
| 356 | ||||||||||
Reinvested |
9 | 328 | ||||||||||
Redeemed in class conversion |
(7,234 | ) | | |||||||||
Redeemed |
(43 | ) | (12,533 | ) | ||||||||
|
|
|
|
|||||||||
Total Class B Shares |
(7,268 | ) | (11,849 | ) | ||||||||
|
|
|
|
|||||||||
Class C Shares (Note 10) |
||||||||||||
Issued |
58,546 | 539,509 | ||||||||||
Reinvested |
32,061 | 34,278 | ||||||||||
Redeemed |
(708,229 | ) | (560,950 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
(617,622 | ) | 12,837 | |||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 10) (b) |
||||||||||||
Issued |
13,664,040 | 6,723,082 | ||||||||||
Reinvested |
1,068,686 | 819,418 | ||||||||||
Redeemed |
(5,700,594 | ) | (7,721,823 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
9,032,132 | (179,323 | ) | |||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Issued |
903 | (c) | | |||||||||
Reinvested |
47 | (c) | | |||||||||
Redeemed |
| (c) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
950 | (c) | | |||||||||
|
|
|
|
|||||||||
Total change in shares |
8,664,263 | (1,662,864 | ) | |||||||||
|
|
|
|
|||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(c) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
20
Financial Highlights
Selected data for each share of capital outstanding throughout the periods indicated
Nationwide HighMark Bond Fund
Operations | Distributions | Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning |
Net Investment Income |
Net Realized and Unrealized Gains (Losses) from Investments |
Total from Operations |
Net Investment Income |
Net Realized Gains |
Total Distributions |
Net Asset Value, End of Period |
Total Return (a)(b)(c) |
Net Assets at End of Period |
Ratio of Expenses to Average Net Assets (d) |
Ratio of Net Investment Income to Average Net Assets (d) |
Ratio of Expenses (Prior to Reimbursements) to Average Net Assets (d)(e) |
Portfolio Turnover (f) |
|||||||||||||||||||||||||||||||||||||||||||
Class A Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 10.94 | 0.29 | 0.15 | 0.44 | (0.31 | ) | (0.26 | ) | (0.57 | ) | $ | 10.81 | 4.13% | $ | 28,985,479 | 0.93% | 2.71% | 0.97% | 57.14% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 11.42 | 0.27 | (0.31 | ) | (0.04 | ) | (0.29 | ) | (0.15 | ) | (0.44 | ) | $ | 10.94 | (0.41% | ) | $ | 26,524,432 | 0.97% | 2.35% | 1.24% | 53.00% | |||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 11.28 | 0.34 | 0.40 | 0.74 | (0.36 | ) | (0.24 | ) | (0.60 | ) | $ | 11.42 | 6.87% | $ | 44,658,869 | 0.99% | 3.05% | 1.25% | 44.00% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 11.21 | 0.38 | 0.18 | 0.56 | (0.40 | ) | (0.09 | ) | (0.49 | ) | $ | 11.28 | 5.09% | $ | 29,448,806 | 1.04% | 3.45% | 1.26% | 58.00% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 10.61 | 0.43 | 0.62 | 1.05 | (0.45 | ) | | (0.45 | ) | $ | 11.21 | 10.08% | $ | 28,951,830 | 1.03% | 3.97% | 1.25% | 32.00% | |||||||||||||||||||||||||||||||||||||
Class C Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 10.88 | 0.24 | 0.15 | 0.39 | (0.26 | ) | (0.26 | ) | (0.52 | ) | $ | 10.75 | 3.68% | $ | 8,293,872 | 1.40% | 2.27% | 1.42% | 57.14% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 11.36 | 0.21 | (0.30 | ) | (0.09 | ) | (0.24 | ) | (0.15 | ) | (0.39 | ) | $ | 10.88 | (0.84% | ) | $ | 15,111,946 | 1.40% | 1.92% | 1.49% | 53.00% | |||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 11.22 | 0.29 | 0.40 | 0.69 | (0.31 | ) | (0.24 | ) | (0.55 | ) | $ | 11.36 | 6.36% | $ | 15,638,520 | 1.42% | 2.62% | 1.50% | 44.00% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 11.15 | 0.33 | 0.18 | 0.51 | (0.35 | ) | (0.09 | ) | (0.44 | ) | $ | 11.22 | 4.77% | $ | 7,773,796 | 1.47% | 3.02% | 1.51% | 58.00% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 10.56 | 0.38 | 0.61 | 0.99 | (0.40 | ) | | (0.40 | ) | $ | 11.15 | 9.58% | $ | 4,164,326 | 1.46% | 3.54% | 1.50% | 32.00% | |||||||||||||||||||||||||||||||||||||
Institutional Service Class Shares(h) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 11.14 | 0.32 | 0.14 | 0.46 | (0.33 | ) | (0.26 | ) | (0.59 | ) | $ | 11.01 | 4.28% | $ | 405,870,576 | 0.70% | 2.88% | 0.74% | 57.14% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 11.62 | 0.30 | (0.31 | ) | (0.01 | ) | (0.32 | ) | (0.15 | ) | (0.47 | ) | $ | 11.14 | (0.15% | ) | $ | 309,889,434 | 0.72% | 2.60% | 0.99% | 53.00% | |||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 11.46 | 0.38 | 0.41 | 0.79 | (0.39 | ) | (0.24 | ) | (0.63 | ) | $ | 11.62 | 7.11% | $ | 325,475,420 | 0.74% | 3.30% | 1.00% | 44.00% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 11.38 | 0.42 | 0.18 | 0.60 | (0.43 | ) | (0.09 | ) | (0.52 | ) | $ | 11.46 | 5.45% | $ | 337,142,952 | 0.79% | 3.70% | 1.01% | 58.00% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 10.77 | 0.47 | 0.62 | 1.09 | (0.48 | ) | | (0.48 | ) | $ | 11.38 | 10.29% | $ | 330,317,720 | 0.78% | 4.23% | 1.00% | 32.00% | |||||||||||||||||||||||||||||||||||||
Institutional Class Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Period Ended July 31, 2014 (g)(i) |
$ | 11.07 | 0.29 | 0.21 | 0.50 | (0.30 | ) | (0.26 | ) | (0.56 | ) | $ | 11.01 | 4.65% | $ | 10,464 | 0.60% | 3.08% | 0.60% | 57.14% | ||||||||||||||||||||||||||||||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Excludes sales charge. |
(b) | Not annualized for periods less than one year. |
(c) | Total returns prior to the Funds inception on September 16, 2013 are based on the performance of the predecessor fund. |
(d) | Annualized for periods less than one year. |
(e) | During the period, certain fees may have been waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(f) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(g) | Per share calculations were performed using average shares method. |
(h) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(i) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. Total return is calculated based on inception date of September 18, 2013 through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
21
Fund Commentary | Nationwide HighMark California Intermediate Tax Free Bond Fund |
22
Fund Overview | Nationwide HighMark California Intermediate Tax Free Bond Fund |
| Percentages indicated are based upon net assets as of July 31, 2014. |
| Percentages indicated are based upon total investments as of July 31, 2014. |
23
Fund Performance | Nationwide HighMark California Intermediate Tax Free Bond |
24
Fund Performance (cont.) | Nationwide HighMark California Intermediate Tax Free Bond Fund |
Performance of a $10,000 Investment
Investment return and principal value will fluctuate, and when redeemed, shares may be worth more or less than original cost. Past performance is no guarantee of future results and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Investing in mutual funds involves market risk, including loss of principal. Performance returns assume the reinvestment of all distributions.
Comparative performance of $10,000 invested in Institutional Service Class shares of the Nationwide HighMark California Intermediate Tax Free Bond Fund versus the Barclays 7-Year Municipal Bond Index and the Consumer Price Index (CPI) over the 10-year period ended 7/31/14. Fund performance prior to the Funds inception on 9/16/13 is based on the Funds predecessor fund. Unlike the Fund, the performance for these unmanaged indexes does not reflect any fees, expenses, or sales charges. One cannot invest directly in a market index. A description of the benchmarks can be found on the Market Index Definitions page at the back of this book.
25
Shareholder Expense Example | Nationwide HighMark California Intermediate Tax Free Bond Fund |
Schedule of Shareholder Expenses
Expense Analysis of a $1,000 Investment
Nationwide HighMark California July 31, 2014 |
Beginning Account Value ($) 02/01/14 |
Ending Account Value ($) 07/31/14 |
Expenses Paid During Period ($) 02/01/14 - 07/31/14 |
Expense Ratio During Period (%) 02/01/14 - 07/31/14 | ||||||||
Class A Shares | Actual | (a) | 1,000.00 | 1,025.90 | 3.97 | 0.79 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,020.88 | 3.96 | 0.79 | |||||||
Class C Shares | Actual | (a) | 1,000.00 | 1,023.80 | 6.22 | 1.24 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,018.65 | 6.21 | 1.24 | |||||||
Institutional Service Class Shares(c) | Actual | (a) | 1,000.00 | 1,028.00 | 2.72 | 0.54 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,022.12 | 2.71 | 0.54 | |||||||
Institutional Class Shares | Actual | (a) | 1,000.00 | 1,028.30 | 2.46 | 0.49 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,022.36 | 2.46 | 0.49 |
(a) | Expenses are equal to the Funds annualized expense ratio multiplied by the average account value from February 1, 2014 through July 31, 2014 multiplied to reflect one-half year period. The expense ratio presented represents a six-month, annualized ratio in accordance with Securities and Exchange Commission guidelines. |
(b) | Represents the hypothetical 5% return before expenses. |
(c) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
26
Statement of Investments
July 31, 2014
Nationwide HighMark California Intermediate Tax Free Bond Fund
27
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark California Intermediate Tax Free Bond Fund (Continued)
28
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark California Intermediate Tax Free Bond Fund (Continued)
29
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark California Intermediate Tax Free Bond Fund (Continued)
The accompanying notes are an integral part of these financial statements.
30
Statement of Assets and Liabilities
July 31, 2014
Nationwide HighMark California Intermediate Tax Free Bond Fund | ||||||
Assets: |
||||||
Investments, at value (cost $174,697,668) |
$ | 186,320,063 | ||||
Interest and dividends receivable |
2,565,916 | |||||
Receivable for capital shares issued |
374,584 | |||||
Prepaid expenses |
5,540 | |||||
|
|
|||||
Total Assets |
189,266,103 | |||||
|
|
|||||
Liabilities: |
||||||
Distributions payable |
163,314 | |||||
Payable for capital shares redeemed |
628,060 | |||||
Accrued expenses and other payables: |
||||||
Investment advisory fees |
64,506 | |||||
Fund administration fees |
10,634 | |||||
Distribution fees |
31,331 | |||||
Administrative servicing fees |
14,948 | |||||
Accounting and transfer agent fees |
5,197 | |||||
Trustee fees |
898 | |||||
Custodian fees |
915 | |||||
Compliance program costs (Note 3) |
525 | |||||
Professional fees |
31,928 | |||||
Printing fees |
6,696 | |||||
Other |
3,714 | |||||
|
|
|||||
Total Liabilities |
962,666 | |||||
|
|
|||||
Net Assets |
$ | 188,303,437 | ||||
|
|
|||||
Represented by: |
||||||
Capital |
$ | 175,341,807 | ||||
Accumulated undistributed net investment income |
30,150 | |||||
Accumulated net realized gains from investments |
1,309,085 | |||||
Net unrealized appreciation/(depreciation) from investments |
11,622,395 | |||||
|
|
|||||
Net Assets |
$ | 188,303,437 | ||||
|
|
|||||
Net Assets: |
||||||
Class A Shares |
$ | 57,843,395 | ||||
Class C Shares |
30,015,316 | |||||
Institutional Service Class Shares |
100,434,193 | |||||
Institutional Class Shares |
10,533 | |||||
|
|
|||||
Total |
$ | 188,303,437 | ||||
|
|
|||||
Shares Outstanding (unlimited number of shares authorized): |
||||||
Class A Shares |
5,522,753 | |||||
Class C Shares |
2,876,548 | |||||
Institutional Service Class Shares |
9,541,030 | |||||
Institutional Class Shares |
1,000 | |||||
|
|
|||||
Total |
17,941,331 | |||||
|
|
|||||
31
Statement of Assets and Liabilities (Continued)
July 31, 2014
Nationwide HighMark California Intermediate Tax Free Bond Fund | ||||||
Net asset value and redemption price per share (Net assets by class divided by shares outstanding by class, respectively): |
||||||
Class A Shares (a) |
$ | 10.47 | ||||
Class C Shares (b) |
$ | 10.43 | ||||
Institutional Service Class Shares |
$ | 10.53 | ||||
Institutional Class Shares |
$ | 10.53 | ||||
Maximum offering price per share (100%/(100%-maximum sales charge) of net asset value adjusted to the nearest cent): |
||||||
Class A Shares |
$ | 10.71 | ||||
|
|
|||||
Maximum Sales Charge: |
||||||
Class A Shares |
2.25 | % | ||||
|
|
|||||
(a) | For Class A Shares, the redemption price per share is reduced by 0.50% on sales of shares of original purchases of $250,000 or more or that were not subject to a front-end sales charge made within 18 months of the purchase date. |
(b) | For Class C Shares, the redemption price per share is reduced by 1.00% for shares held less than one year. |
The accompanying notes are an integral part of these financial statements.
32
Statement of Operations
For the Year Ended July 31, 2014
Nationwide HighMark California Intermediate Tax Free Bond Fund | ||||||
INVESTMENT INCOME: |
||||||
Interest income |
$ | 6,309,387 | ||||
Dividend income |
148 | |||||
|
|
|||||
Total Income |
6,309,535 | |||||
|
|
|||||
EXPENSES: |
||||||
Investment advisory fees |
1,018,976 | |||||
Fund administration fees |
166,272 | |||||
Distribution fees Class A |
164,728 | |||||
Distribution fees Class C |
251,360 | |||||
Administrative servicing fees Class A |
49,150 | |||||
Administrative servicing fees Class C |
5,242 | |||||
Administrative servicing fees Institutional Service Class (a) |
60,085 | |||||
Registration and filing fees |
11,284 | |||||
Professional fees |
50,431 | |||||
Printing fees |
17,219 | |||||
Trustee fees |
4,653 | |||||
Custodian fees |
8,024 | |||||
Accounting and transfer agent fees |
29,771 | |||||
Compliance program costs (Note 3) |
1,867 | |||||
Other |
27,469 | |||||
|
|
|||||
Total expenses before earnings credit, fees waived, and expenses reimbursed |
1,866,531 | |||||
|
|
|||||
Earnings credit (Note 4) |
(297 | ) | ||||
Administrative servicing fees voluntarily waived Class A (Note 3) |
(18,689 | ) | ||||
Administrative servicing fees voluntarily waived Institutional Service Class (Note 3) (a) |
(28,433 | ) | ||||
Expenses reimbursed by adviser (Note 3) |
(319,879 | ) | ||||
|
|
|||||
Net Expenses |
1,499,233 | |||||
|
|
|||||
NET INVESTMENT INCOME |
4,810,302 | |||||
|
|
|||||
REALIZED/UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: |
||||||
Net realized gains from investment transactions |
1,795,473 | |||||
Net change in unrealized appreciation/(depreciation) from investments |
4,282,229 | |||||
|
|
|||||
Net realized/unrealized gains from investments |
6,077,702 | |||||
|
|
|||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS |
$ | 10,888,004 | ||||
|
|
|||||
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
The accompanying notes are an integral part of these financial statements.
33
Statements of Changes in Net Assets
Nationwide HighMark California Intermediate Tax Free Bond Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
Operations: |
||||||||||||
Net investment income |
$ | 4,810,302 | $ | 5,979,705 | ||||||||
Net realized gains from investments |
1,795,473 | 150,196 | ||||||||||
Net change in unrealized appreciation/(depreciation) from investments |
4,282,229 | (9,210,247 | ) | |||||||||
|
|
|
|
|||||||||
Change in net assets resulting from operations |
10,888,004 | (3,080,346 | ) | |||||||||
|
|
|
|
|||||||||
Distributions to Shareholders From: |
||||||||||||
Net investment income: |
||||||||||||
Class A |
(1,523,538 | ) | (2,024,600 | ) | ||||||||
Class C |
(627,954 | ) | (689,179 | ) | ||||||||
Institutional Service Class (a) |
(2,648,495 | ) | (3,289,031 | ) | ||||||||
Institutional Class |
(228 | )(b) | | |||||||||
Net realized gains: |
||||||||||||
Class A |
(130,280 | ) | | |||||||||
Class C |
(66,279 | ) | | |||||||||
Institutional Service Class (a) |
(203,718 | ) | | |||||||||
Institutional Class |
(19 | )(b) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from shareholder distributions |
(5,200,511 | ) | (6,002,810 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
(48,021,143 | ) | (21,511,423 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets |
(42,333,650 | ) | (30,594,579 | ) | ||||||||
|
|
|
|
|||||||||
Net Assets: |
||||||||||||
Beginning of year |
230,637,087 | 261,231,666 | ||||||||||
|
|
|
|
|||||||||
End of year |
$ | 188,303,437 | $ | 230,637,087 | ||||||||
|
|
|
|
|||||||||
Accumulated undistributed net investment income at end of year |
$ | 30,150 | $ | 20,063 | ||||||||
|
|
|
|
|||||||||
CAPITAL TRANSACTIONS: |
||||||||||||
Class A Shares (Note 10) |
||||||||||||
Proceeds from shares issued |
$ | 16,143,389 | $ | 31,490,036 | ||||||||
Dividends reinvested |
1,244,489 | 1,519,633 | ||||||||||
Cost of shares redeemed |
(37,861,210 | ) | (46,078,095 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
(20,473,332 | ) | (13,068,426 | ) | ||||||||
|
|
|
|
|||||||||
Class C Shares (Note 10) |
||||||||||||
Proceeds from shares issued |
4,749,449 | 15,323,206 | ||||||||||
Dividends reinvested |
597,855 | 521,271 | ||||||||||
Cost of shares redeemed |
(14,518,232 | ) | (11,632,434 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
(9,170,928 | ) | 4,212,043 | |||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 10) (a) |
||||||||||||
Proceeds from shares issued |
21,181,458 | 34,674,779 | ||||||||||
Dividends reinvested |
1,052,228 | 1,295,602 | ||||||||||
Cost of shares redeemed |
(40,620,816 | ) | (48,625,421 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
(18,387,130 | ) | (12,655,040 | ) | ||||||||
|
|
|
|
|||||||||
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(b) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
34
Statements of Changes in Net Assets (Continued)
Nationwide HighMark California Intermediate Tax Free Bond Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
CAPITAL TRANSACTIONS: (continued) |
||||||||||||
Institutional Class Shares |
||||||||||||
Proceeds from shares issued |
$ | 10,000 | (b) | $ | | |||||||
Dividends reinvested |
247 | (b) | | |||||||||
Cost of shares redeemed |
| (b) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
10,247 | (b) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
$ | (48,021,143 | ) | $ | (21,511,423 | ) | ||||||
|
|
|
|
|||||||||
SHARE TRANSACTIONS: |
||||||||||||
Class A Shares (Note 10) |
||||||||||||
Issued |
1,572,624 | 2,994,460 | ||||||||||
Reinvested |
120,788 | 144,930 | ||||||||||
Redeemed |
(3,687,683 | ) | (4,403,602 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
(1,994,271 | ) | (1,264,212 | ) | ||||||||
|
|
|
|
|||||||||
Class C Shares (Note 10) |
||||||||||||
Issued |
463,976 | 1,460,144 | ||||||||||
Reinvested |
58,238 | 49,913 | ||||||||||
Redeemed |
(1,418,052 | ) | (1,118,976 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
(895,838 | ) | 391,081 | |||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 10) (a) |
||||||||||||
Issued |
2,045,485 | 3,275,945 | ||||||||||
Reinvested |
101,649 | 122,883 | ||||||||||
Redeemed |
(3,939,157 | ) | (4,630,981 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
(1,792,023 | ) | (1,232,153 | ) | ||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Issued |
976 | (b) | | |||||||||
Reinvested |
24 | (b) | | |||||||||
Redeemed |
| (b) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
1,000 | (b) | | |||||||||
|
|
|
|
|||||||||
Total change in shares |
(4,681,132 | ) | (2,105,284 | ) | ||||||||
|
|
|
|
|||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(b) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
35
Financial Highlights
Selected data for each share of capital outstanding throughout the periods indicated
Nationwide HighMark California Intermediate Tax Free Bond Fund
Operations | Distributions | Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period |
Net Investment Income |
Net Realized and Unrealized Gains (Losses) from Investments |
Total from Operations |
Net Investment Income |
Net Realized Gains |
Total Distributions |
Net Asset Value, End of Period |
Total Return (a)(b)(c) |
Net Assets at End of Period |
Ratio of Expenses to Average Net Assets (d) |
Ratio of Net Investment Income to Average Net Assets (d) |
Ratio of Expenses (Prior to Reimbursements) to Average Net Assets (d)(e) |
Portfolio Turnover (f) |
|||||||||||||||||||||||||||||||||||||||||||
Class A Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 10.17 | 0.24 | 0.32 | 0.56 | (0.24 | ) | (0.02 | ) | (0.26 | ) | $ | 10.47 | 5.54% | $ | 57,843,395 | 0.79% | 2.31% | 0.98% | 3.67% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 10.54 | 0.23 | (0.37 | ) | (0.14 | ) | (0.23 | ) | | (0.23 | ) | $ | 10.17 | (1.38% | ) | $ | 76,478,399 | 0.79% | 2.17% | 1.25% | 20.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 10.14 | 0.24 | 0.40 | 0.64 | (0.24 | ) | | (0.24 | ) | $ | 10.54 | 6.40% | $ | 92,569,680 | 0.79% | 2.30% | 1.27% | 34.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 10.18 | 0.25 | (0.04 | ) | 0.21 | (0.25 | ) | | (0.25 | ) | $ | 10.14 | 2.13% | $ | 78,038,152 | 0.79% | 2.54% | 1.27% | 32.00% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 9.98 | 0.30 | 0.22 | 0.52 | (0.30 | ) | (0.02 | ) | (0.32 | ) | $ | 10.18 | 5.26% | $ | 76,111,437 | 0.78% | 2.97% | 1.27% | 17.00% | ||||||||||||||||||||||||||||||||||||
Class C Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 10.14 | 0.19 | 0.31 | 0.50 | (0.19 | ) | (0.02 | ) | (0.21 | ) | $ | 10.43 | 4.99% | $ | 30,015,316 | 1.24% | 1.87% | 1.43% | 3.67% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 10.50 | 0.18 | (0.36 | ) | (0.18 | ) | (0.18 | ) | | (0.18 | ) | $ | 10.14 | (1.72% | ) | $ | 38,244,483 | 1.24% | 1.72% | 1.50% | 20.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 10.10 | 0.19 | 0.41 | 0.60 | (0.20 | ) | | (0.20 | ) | $ | 10.50 | 5.96% | $ | 35,519,408 | 1.24% | 1.85% | 1.52% | 34.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 10.15 | 0.21 | (0.05 | ) | 0.16 | (0.21 | ) | | (0.21 | ) | $ | 10.10 | 1.59% | $ | 22,805,903 | 1.24% | 2.09% | 1.52% | 32.00% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 9.95 | 0.25 | 0.22 | 0.47 | (0.25 | ) | (0.02 | ) | (0.27 | ) | $ | 10.15 | 4.82% | $ | 14,859,778 | 1.23% | 2.52% | 1.52% | 17.00% | ||||||||||||||||||||||||||||||||||||
Institutional Service Class Shares (h) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 10.23 | 0.26 | 0.32 | 0.58 | (0.26 | ) | (0.02 | ) | (0.28 | ) | $ | 10.53 | 5.77% | $ | 100,434,193 | 0.54% | 2.55% | 0.71% | 3.67% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 10.60 | 0.26 | (0.37 | ) | (0.11 | ) | (0.26 | ) | | (0.26 | ) | $ | 10.23 | (1.12% | ) | $ | 115,914,205 | 0.54% | 2.42% | 1.00% | 20.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 10.19 | 0.27 | 0.41 | 0.68 | (0.27 | ) | | (0.27 | ) | $ | 10.60 | 6.73% | $ | 133,142,578 | 0.54% | 2.55% | 1.02% | 34.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 10.23 | 0.28 | (0.04 | ) | 0.24 | (0.28 | ) | | (0.28 | ) | $ | 10.19 | 2.38% | $ | 123,643,818 | 0.54% | 2.79% | 1.02% | 32.00% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 10.03 | 0.33 | 0.21 | 0.54 | (0.32 | ) | (0.02 | ) | (0.34 | ) | $ | 10.23 | 5.49% | $ | 112,406,697 | 0.53% | 3.22% | 1.02% | 17.00% | ||||||||||||||||||||||||||||||||||||
Institutional Class Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Period Ended July 31, 2014 (g)(i) |
$ | 10.24 | 0.23 | 0.31 | 0.54 | (0.23 | ) | (0.02 | ) | (0.25 | ) | $ | 10.53 | 5.34% | $ | 10,533 | 0.49% | 2.58% | 0.64% | 3.67% | ||||||||||||||||||||||||||||||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Excludes sales charge. |
(b) | Not annualized for periods less than one year. |
(c) | Total returns prior to the Funds inception on September 16, 2013 are based on the performance of the Funds predecessor fund. |
(d) | Annualized for periods less than one year. |
(e) | During the period, certain fees may have been waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(f) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(g) | Per share calculations were performed using average shares method. |
(h) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(i) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. Total return is calculated based on inception date of September 18, 2013 through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
36
Fund Commentary | Nationwide HighMark National Intermediate Tax Free Bond Fund |
37
Fund Commentary (cont.) | Nationwide HighMark National Intermediate Tax Free Bond Fund |
38
Fund Overview | Nationwide HighMark National Intermediate Tax Free Bond Fund |
| Percentages indicated are based upon net assets as of July 31, 2014. |
| Percentages indicated are based upon total investments as of July 31, 2014. |
39
Fund Performance | Nationwide HighMark National Intermediate Tax Free Bond Fund |
40
Fund Performance (cont.) | Nationwide HighMark National Intermediate Tax Free Bond Fund |
Performance of a $10,000 Investment
Investment return and principal value will fluctuate, and when redeemed, shares may be worth more or less than original cost. Past performance is no guarantee of future results and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Investing in mutual funds involves market risk, including loss of principal. Performance returns assume the reinvestment of all distributions.
Comparative performance of $10,000 invested in Institutional Service Class shares of the Nationwide HighMark National Intermediate Tax Free Bond Fund versus the Barclays 7-Year Municipal Bond Index and the Consumer Price Index (CPI) over the 10-year period ended 7/31/14. Fund performance prior to the Funds inception on 9/16/13 is based on the Funds predecessor fund. Unlike the Fund, the performance for these unmanaged indexes does not reflect any fees, expenses, or sales charges. One cannot invest directly in a market index. A description of the benchmarks can be found on the Market Index Definitions page at the back of this book.
41
Shareholder Expense Example | Nationwide HighMark National Intermediate Tax Free Bond Fund |
Schedule of Shareholder Expenses
Expense Analysis of a $1,000 Investment
Nationwide HighMark National July 31, 2014 |
Beginning Account Value ($) 02/01/14 |
Ending Account Value ($) 07/31/14 |
Expenses Paid During Period ($) 02/01/14 - 07/31/14 |
Expense Ratio During Period (%) 02/01/14 - 07/31/14 | ||||||||
Class A Shares | Actual | (a) | 1,000.00 | 1,020.20 | 3.86 | 0.77 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,020.98 | 3.86 | 0.77 | ||||||||
Class C Shares | Actual | (a) | 1,000.00 | 1,017.90 | 6.10 | 1.22 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,018.74 | 6.11 | 1.22 | ||||||||
Institutional Service Class Shares(c) | Actual | (a) | 1,000.00 | 1,021.40 | 2.61 | 0.52 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,022.22 | 2.61 | 0.52 | ||||||||
Institutional Class Shares | Actual | (a) | 1,000.00 | 1,021.70 | 2.36 | 0.47 | ||||||
Hypothetical(a)(b) | 1,000.00 | 1,022.46 | 2.36 | 0.47 |
(a) | Expenses are equal to the Funds annualized expense ratio multiplied by the average account value from February 1, 2014 through July 31, 2014 multiplied to reflect one-half year period. The expense ratio presented represents a six-month, annualized ratio in accordance with Securities and Exchange Commission guidelines. |
(b) | Represents the hypothetical 5% return before expenses. |
(c) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
42
Statement of Investments
July 31, 2014
Nationwide HighMark National Intermediate Tax Free Bond Fund
43
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark National Intermediate Tax Free Bond Fund (Continued)
44
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark National Intermediate Tax Free Bond Fund (Continued)
The accompanying notes are an integral part of these financial statements.
45
Statement of Assets and Liabilities
July 31, 2014
Nationwide HighMark National Intermediate Tax Free Bond Fund | ||||||
Assets: |
||||||
Investments, at value (cost $66,005,517) |
$ | 69,963,329 | ||||
Interest receivable |
766,034 | |||||
Receivable for capital shares issued |
106,729 | |||||
Prepaid expenses |
9,821 | |||||
|
|
|||||
Total Assets |
70,845,913 | |||||
|
|
|||||
Liabilities: |
||||||
Distributions payable |
84,476 | |||||
Payable for capital shares redeemed |
16,579 | |||||
Accrued expenses and other payables: |
||||||
Investment advisory fees |
8,007 | |||||
Fund administration fees |
8,115 | |||||
Distribution fees |
6,119 | |||||
Administrative servicing fees |
7,792 | |||||
Accounting and transfer agent fees |
2,073 | |||||
Trustee fees |
382 | |||||
Custodian fees |
367 | |||||
Compliance program costs (Note 3) |
1,424 | |||||
Professional fees |
30,914 | |||||
Printing fees |
3,708 | |||||
Other |
3,508 | |||||
|
|
|||||
Total Liabilities |
173,464 | |||||
|
|
|||||
Net Assets |
$ | 70,672,449 | ||||
|
|
|||||
Represented by: |
||||||
Capital |
$ | 65,701,707 | ||||
Accumulated undistributed net investment income |
3,018 | |||||
Accumulated net realized gains from investments |
1,009,912 | |||||
Net unrealized appreciation/(depreciation) from investments |
3,957,812 | |||||
|
|
|||||
Net Assets |
$ | 70,672,449 | ||||
|
|
|||||
Net Assets: |
||||||
Class A Shares |
$ | 13,921,742 | ||||
Class C Shares |
4,787,696 | |||||
Institutional Service Class Shares |
51,952,550 | |||||
Institutional Class Shares |
10,461 | |||||
|
|
|||||
Total |
$ | 70,672,449 | ||||
|
|
|||||
Shares Outstanding (unlimited number of shares authorized): |
||||||
Class A Shares |
1,215,540 | |||||
Class C Shares |
417,500 | |||||
Institutional Service Class Shares |
4,533,534 | |||||
Institutional Class Shares |
913 | |||||
|
|
|||||
Total |
6,167,487 | |||||
|
|
|||||
46
Statement of Assets and Liabilities (Continued)
July 31, 2014
Nationwide HighMark National Intermediate Tax Free Bond Fund | ||||||
Net asset value and redemption price per share (Net assets by class divided by shares outstanding by class, respectively): |
||||||
Class A Shares (a) |
$ | 11.45 | ||||
Class C Shares (b) |
$ | 11.47 | ||||
Institutional Service Class Shares |
$ | 11.46 | ||||
Institutional Class Shares |
$ | 11.46 | ||||
Maximum offering price per share (100%/(100%-maximum sales charge) of net asset value adjusted to the nearest cent): |
||||||
Class A Shares |
$ | 11.71 | ||||
|
|
|||||
Maximum Sales Charge: |
||||||
Class A Shares |
2.25 | % | ||||
|
|
|||||
(a) | For Class A Shares, the redemption price per share is reduced by 0.50% on sales of shares of original purchases of $250,000 or more or that were not subject to a front-end sales charge made within 18 months of the purchase date. |
(b) | For Class C Shares, the redemption price per share is reduced by 1.00% for shares held less than one year. |
The accompanying notes are an integral part of these financial statements.
47
Statement of Operations
For the Year Ended July 31, 2014
Nationwide HighMark National Intermediate Tax Free Bond Fund | ||||||
INVESTMENT INCOME: |
||||||
Interest income |
$ | 2,378,066 | ||||
Dividend income |
2 | |||||
|
|
|||||
Total Income |
2,378,068 | |||||
|
|
|||||
EXPENSES: |
||||||
Investment advisory fees |
390,489 | |||||
Fund administration fees |
109,605 | |||||
Distribution fees Class A |
40,314 | |||||
Distribution fees Class C |
42,616 | |||||
Administrative servicing fees Class A |
12,846 | |||||
Administrative servicing fees Class C |
572 | |||||
Administrative servicing fees Institutional Service Class (a) |
35,962 | |||||
Registration and filing fees |
41,973 | |||||
Professional fees |
43,194 | |||||
Printing fees |
12,767 | |||||
Trustee fees |
1,834 | |||||
Custodian fees |
3,171 | |||||
Accounting and transfer agent fees |
10,055 | |||||
Compliance program costs (Note 3) |
1,735 | |||||
Other |
14,765 | |||||
|
|
|||||
Total expenses before earnings credit, fees waived, and expenses reimbursed |
761,898 | |||||
|
|
|||||
Earnings credit (Note 4) |
(169 | ) | ||||
Administrative servicing fees voluntarily waived Class A (Note 3) |
(4,284 | ) | ||||
Administrative servicing fees voluntarily waived Institutional Service Class (Note 3) (a) |
(15,565 | ) | ||||
Expenses reimbursed by adviser (Note 3) |
(255,947 | ) | ||||
|
|
|||||
Net Expenses |
485,933 | |||||
|
|
|||||
NET INVESTMENT INCOME |
1,892,135 | |||||
|
|
|||||
REALIZED/UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: |
||||||
Net realized gains from investment transactions |
1,077,555 | |||||
Net change in unrealized appreciation/(depreciation) from investments |
556,200 | |||||
|
|
|||||
Net realized/unrealized gains from investments |
1,633,755 | |||||
|
|
|||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS |
$ | 3,525,890 | ||||
|
|
|||||
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
The accompanying notes are an integral part of these financial statements.
48
Statements of Changes in Net Assets
Nationwide HighMark National Intermediate Tax Free Bond Fund | ||||||||||||
Year Ended July 31, 2014 |
Year
Ended July 31, 2013 | |||||||||||
Operations: |
||||||||||||
Net investment income |
$ | 1,892,135 | $ | 2,472,643 | ||||||||
Net realized gains from investments |
1,077,555 | 828,693 | ||||||||||
Net change in unrealized appreciation/(depreciation) from investments |
556,200 | (4,224,048 | ) | |||||||||
|
|
|
|
|||||||||
Change in net assets resulting from operations |
3,525,890 | (922,712 | ) | |||||||||
|
|
|
|
|||||||||
Distributions to Shareholders From: |
||||||||||||
Net investment income: |
||||||||||||
Class A |
(366,775 | ) | (449,232 | ) | ||||||||
Class C |
(104,001 | ) | (160,274 | ) | ||||||||
Institutional Service Class (a) |
(1,419,543 | ) | (1,887,503 | ) | ||||||||
Institutional Class |
(226 | )(b) | | |||||||||
Net realized gains: |
||||||||||||
Class A |
(173,393 | ) | (75,784 | ) | ||||||||
Class C |
(58,083 | ) | (29,953 | ) | ||||||||
Institutional Service Class (a) |
(567,480 | ) | (257,137 | ) | ||||||||
Institutional Class |
(100 | )(b) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from shareholder distributions |
(2,689,601 | ) | (2,859,883 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
(18,479,627 | ) | (8,059,890 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets |
(17,643,338 | ) | (11,842,485 | ) | ||||||||
|
|
|
|
|||||||||
Net Assets: |
||||||||||||
Beginning of year |
88,315,787 | 100,158,272 | ||||||||||
|
|
|
|
|||||||||
End of year |
$ | 70,672,449 | $ | 88,315,787 | ||||||||
|
|
|
|
|||||||||
Accumulated undistributed net investment income at end of year |
$ | 3,018 | $ | 1,428 | ||||||||
|
|
|
|
|||||||||
CAPITAL TRANSACTIONS: |
||||||||||||
Class A Shares (Note 10) |
||||||||||||
Proceeds from shares issued |
$ | 5,135,974 | $ | 8,288,589 | ||||||||
Dividends reinvested |
360,673 | 314,655 | ||||||||||
Cost of shares redeemed |
(9,659,205 | ) | (8,904,688 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
(4,162,558 | ) | (301,444 | ) | ||||||||
|
|
|
|
|||||||||
Class C Shares (Note 10) |
||||||||||||
Proceeds from shares issued |
407,245 | 2,009,124 | ||||||||||
Dividends reinvested |
150,187 | 152,335 | ||||||||||
Cost of shares redeemed |
(3,060,213 | ) | (2,602,230 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
(2,502,781 | ) | (440,771 | ) | ||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 10) (a) |
||||||||||||
Proceeds from shares issued |
4,188,054 | 12,657,301 | ||||||||||
Dividends reinvested |
834,836 | 686,042 | ||||||||||
Cost of shares redeemed |
(16,847,504 | ) | (20,661,018 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
(11,824,614 | ) | (7,317,675 | ) | ||||||||
|
|
|
|
|||||||||
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(b) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
49
Statements of Changes in Net Assets (Continued)
Nationwide HighMark National Intermediate Tax Free Bond Fund | ||||||||||||
Year Ended July 31, 2014 |
Year
Ended July 31, 2013 | |||||||||||
CAPITAL TRANSACTIONS: (continued) |
||||||||||||
Institutional Class Shares |
||||||||||||
Proceeds from shares issued |
$ | 10,000 | (b) | $ | | |||||||
Dividends reinvested |
326 | (b) | | |||||||||
Cost of shares redeemed |
| (b) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
10,326 | (b) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
$ | (18,479,627 | ) | $ | (8,059,890 | ) | ||||||
|
|
|
|
|||||||||
SHARE TRANSACTIONS: |
||||||||||||
Class A Shares (Note 10) |
||||||||||||
Issued |
454,122 | 714,223 | ||||||||||
Reinvested |
31,839 | 26,898 | ||||||||||
Redeemed |
(853,046 | ) | (767,467 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
(367,085 | ) | (26,346 | ) | ||||||||
|
|
|
|
|||||||||
Class C Shares (Note 10) |
||||||||||||
Issued |
35,884 | 171,146 | ||||||||||
Reinvested |
13,251 | 13,017 | ||||||||||
Redeemed |
(269,524 | ) | (223,034 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
(220,389 | ) | (38,871 | ) | ||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 10) (a) |
||||||||||||
Issued |
368,489 | 1,077,972 | ||||||||||
Reinvested |
73,868 | 58,586 | ||||||||||
Redeemed |
(1,485,682 | ) | (1,774,237 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
(1,043,325 | ) | (637,679 | ) | ||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Issued |
884 | (b) | | |||||||||
Reinvested |
29 | (b) | | |||||||||
Redeemed |
| (b) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
913 | (b) | | |||||||||
|
|
|
|
|||||||||
Total change in shares |
(1,629,886 | ) | (702,896 | ) | ||||||||
|
|
|
|
|||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(b) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
50
Financial Highlights
Selected data for each share of capital outstanding throughout the periods indicated
Nationwide HighMark National Intermediate Tax Free Bond Fund
Operations | Distributions | Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period |
Net Investment Income |
Net
Realized and Unrealized Gains (Losses) from Investments |
Total from Operations |
Net Investment Income |
Net Realized Gains |
Total Distributions |
Net Asset Value, End of Period |
Total Return (a)(b)(c) |
Net Assets at End of Period |
Ratio of Expenses to Average Net Assets (d) |
Ratio of
Net Investment Income to Average Net Assets (d) |
Ratio of Expenses (Prior to Reimbursements) to Average Net Assets (d)(e) |
Portfolio Turnover (f) |
|||||||||||||||||||||||||||||||||||||||||||
Class A Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 11.32 | 0.26 | 0.24 | 0.50 | (0.26 | ) | (0.11 | ) | (0.37 | ) | $ | 11.45 | 4.49% | $ | 13,921,742 | 0.77% | 2.28% | 1.14% | 10.35% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 11.78 | 0.28 | (0.42 | ) | (0.14 | ) | (0.28 | ) | (0.04 | ) | (0.32 | ) | $ | 11.32 | (1.23% | ) | $ | 17,914,754 | 0.77% | 2.37% | 1.32% | 27.00% | |||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 11.42 | 0.28 | 0.36 | 0.64 | (0.28 | ) | | (0.28 | ) | $ | 11.78 | 5.70% | $ | 18,949,616 | 0.77% | 2.46% | 1.33% | 20.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 11.48 | 0.29 | (0.06 | ) | 0.23 | (0.29 | ) | | (0.29 | ) | $ | 11.42 | 2.08% | $ | 23,674,401 | 0.77% | 2.56% | 1.33% | 22.00% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 11.20 | 0.31 | 0.28 | 0.59 | (0.31 | ) | | (0.31 | ) | $ | 11.48 | 5.33% | $ | 22,334,709 | 0.76% | 2.74% | 1.32% | 14.00% | |||||||||||||||||||||||||||||||||||||
Class C Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 11.33 | 0.21 | 0.25 | 0.46 | (0.21 | ) | (0.11 | ) | (0.32 | ) | $ | 11.47 | 4.11% | $ | 4,787,696 | 1.22% | 1.83% | 1.57% | 10.35% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 11.79 | 0.23 | (0.42 | ) | (0.19 | ) | (0.23 | ) | (0.04 | ) | (0.27 | ) | $ | 11.33 | (1.68% | ) | $ | 7,230,375 | 1.22% | 1.92% | 1.57% | 27.00% | |||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 11.43 | 0.23 | 0.36 | 0.59 | (0.23 | ) | | (0.23 | ) | $ | 11.79 | 5.22% | $ | 7,978,232 | 1.22% | 2.01% | 1.58% | 20.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 11.49 | 0.24 | (0.06 | ) | 0.18 | (0.24 | ) | | (0.24 | ) | $ | 11.43 | 1.71% | $ | 4,161,043 | 1.22% | 2.11% | 1.58% | 22.00% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 11.40 | 0.17 | 0.20 | 0.37 | (0.28 | ) | | (0.28 | ) | $ | 11.49 | 2.25% | $ | 2,362,903 | 1.21% | 2.29% | 1.57% | 14.00% | |||||||||||||||||||||||||||||||||||||
Institutional Service Class Shares (h) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014(g) |
$ | 11.33 | 0.29 | 0.24 | 0.53 | (0.29 | ) | (0.11 | ) | (0.40 | ) | $ | 11.46 | 4.75% | $ | 51,952,550 | 0.52% | 2.53% | 0.87% | 10.35% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 11.78 | 0.31 | (0.41 | ) | (0.10 | ) | (0.31 | ) | (0.04 | ) | (0.35 | ) | $ | 11.33 | (0.89% | ) | $ | 63,170,658 | 0.52% | 2.62% | 1.07% | 27.00% | |||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 11.43 | 0.31 | 0.35 | 0.66 | (0.31 | ) | | (0.31 | ) | $ | 11.78 | 5.87% | $ | 73,230,424 | 0.52% | 2.71% | 1.08% | 20.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 11.48 | 0.32 | (0.05 | ) | 0.27 | (0.32 | ) | | (0.32 | ) | $ | 11.43 | 2.43% | $ | 79,902,327 | 0.52% | 2.81% | 1.08% | 22.00% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 11.20 | 0.34 | 0.28 | 0.62 | (0.34 | ) | | (0.34 | ) | $ | 11.48 | 5.60% | $ | 81,120,621 | 0.51% | 2.99% | 1.07% | 14.00% | |||||||||||||||||||||||||||||||||||||
Institutional Class Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Period Ended July 31, 2014 (g)(i) |
$ | 11.31 | 0.25 | 0.26 | 0.51 | (0.25 | ) | (0.11 | ) | (0.36 | ) | $ | 11.46 | 4.61% | $ | 10,461 | 0.47% | 2.55% | 0.80% | 10.35% | ||||||||||||||||||||||||||||||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Excludes sales charge. |
(b) | Not annualized for periods less than one year. |
(c) | Total returns prior to the Funds inception on September 16, 2013 are based on the performance of the Funds predecessor fund. |
(d) | Annualized for periods less than one year. |
(e) | During the period, certain fees may have been waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(f) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(g) | Per share calculations were performed using average shares method. |
(h) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(i) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. Total return is calculated based on inception date of September 18, 2013 through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
51
Fund Commentary | Nationwide HighMark Short Term Bond Fund |
52
Fund Commentary (cont.) | Nationwide HighMark Short Term Bond Fund |
53
Fund Overview | Nationwide HighMark Short Term Bond Fund |
| Percentages indicated are based upon net assets as of July 31, 2014. |
| Percentages indicated are based upon total investments as of July 31, 2014. |
54
Fund Performance | Nationwide HighMark Short Term Bond Fund |
55
Fund Performance (cont.) | Nationwide HighMark Short Term Bond Fund |
Performance of a $10,000 Investment
Investment return and principal value will fluctuate, and when redeemed, shares may be worth more or less than original cost. Past performance is no guarantee of future results and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Investing in mutual funds involves market risk, including loss of principal. Performance returns assume the reinvestment of all distributions.
Comparative performance of $10,000 invested in Institutional Service Class shares of the Nationwide HighMark Short Term Bond Fund since inception* through 7/31/14 versus the Barclays U.S. 1-3 Year Government/Credit Bond Index and the Consumer Price Index (CPI) for the same period. Unlike the Fund, the performance for these unmanaged indexes does not reflect any fees, expenses, or sales charges. One cannot invest directly in a market index. A description of the benchmarks can be found on the Market Index Definitions page at the back of this book.
*The inception date for the Nationwide HighMark Short Term Bond Fund is 9/16/13. Performance prior to that date is based on the since-inception performance of the Funds predecessor fund.
56
Shareholder Expense Example | Nationwide HighMark Short Term Bond Fund |
Schedule of Shareholder Expenses
Expense Analysis of a $1,000 Investment
Nationwide HighMark Short Term July 31, 2014 |
Beginning Account Value ($) 02/01/14 |
Ending Account Value ($) 07/31/14 |
Expenses Paid During Period ($) 02/01/14 - 07/31/14 |
Expense Ratio During Period (%) 02/01/14 - 07/31/14 | ||||||||
Class A Shares | Actual | (a) | 1,000.00 | 1,002.40 | 3.87 | 0.78 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,020.93 | 3.91 | 0.78 | |||||||
Class C Shares | Actual | (a) | 1,000.00 | 1,000.10 | 6.20 | 1.25 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,018.60 | 6.26 | 1.25 | |||||||
Institutional Service Class Shares(c) | Actual | (a) | 1,000.00 | 1,003.90 | 2.43 | 0.49 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,022.36 | 2.46 | 0.49 | |||||||
Institutional Class Shares | Actual | (a) | 1,000.00 | 1,004.00 | 2.34 | 0.47 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,022.46 | 2.36 | 0.47 |
(a) | Expenses are equal to the Funds annualized expense ratio multiplied by the average account value from February 1, 2014 through July 31, 2014 multiplied to reflect one-half year period. The expense ratio presented represents a six-month, annualized ratio in accordance with Securities and Exchange Commission guidelines. |
(b) | Represents the hypothetical 5% return before expenses. |
(c) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
57
Statement of Investments
July 31, 2014
Nationwide HighMark Short Term Bond Fund
58
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Short Term Bond Fund (Continued)
59
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Short Term Bond Fund (Continued)
60
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Short Term Bond Fund (Continued)
61
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Short Term Bond Fund (Continued)
62
Statement of Investments (Continued)
July 31, 2014
Nationwide HighMark Short Term Bond Fund (Continued)
The accompanying notes are an integral part of these financial statements.
63
Statement of Assets and Liabilities
July 31, 2014
Nationwide HighMark Short Term Bond Fund | ||||||
Assets: |
||||||
Investments, at value (cost $389,189,743) |
$ | 389,191,715 | ||||
Cash |
29,465,835 | |||||
Interest and dividends receivable |
1,234,150 | |||||
Receivable for investments sold |
57,109 | |||||
Receivable for capital shares issued |
62,403 | |||||
Prepaid expenses |
11,053 | |||||
|
|
|||||
Total Assets |
420,022,265 | |||||
|
|
|||||
Liabilities: |
||||||
Payable for investments purchased |
17,240,516 | |||||
Distributions payable |
54,412 | |||||
Payable for capital shares redeemed |
946,013 | |||||
Accrued expenses and other payables: |
||||||
Investment advisory fees |
88,659 | |||||
Fund administration fees |
13,643 | |||||
Distribution fees |
21,523 | |||||
Administrative servicing fees |
10,513 | |||||
Accounting and transfer agent fees |
3,930 | |||||
Trustee fees |
933 | |||||
Custodian fees |
600 | |||||
Compliance program costs (Note 3) |
1,102 | |||||
Professional fees |
33,511 | |||||
Printing fees |
7,152 | |||||
Other |
3,892 | |||||
|
|
|||||
Total Liabilities |
18,426,399 | |||||
|
|
|||||
Net Assets |
$ | 401,595,866 | ||||
|
|
|||||
Represented by: |
||||||
Capital |
$ | 401,991,173 | ||||
Accumulated distributions in excess of net investment income |
(63,539 | ) | ||||
Accumulated net realized losses from investments |
(333,740 | ) | ||||
Net unrealized appreciation/(depreciation) from investments |
1,972 | |||||
|
|
|||||
Net Assets |
$ | 401,595,866 | ||||
|
|
|||||
Net Assets: |
||||||
Class A Shares |
$ | 43,251,067 | ||||
Class C Shares |
19,025,184 | |||||
Institutional Service Class Shares |
83,068,672 | |||||
Institutional Class Shares |
256,250,943 | |||||
|
|
|||||
Total |
$ | 401,595,866 | ||||
|
|
|||||
Shares Outstanding (unlimited number of shares authorized): |
||||||
Class A Shares |
4,323,702 | |||||
Class C Shares |
1,878,867 | |||||
Institutional Service Class Shares |
8,293,551 | |||||
Institutional Class Shares |
25,573,941 | |||||
|
|
|||||
Total |
40,070,061 | |||||
|
|
|||||
64
Statement of Assets and Liabilities (Continued)
July 31, 2014
Nationwide HighMark Short Term Bond Fund | ||||||
Net asset value and redemption price per share (Net assets by class divided by shares outstanding by class, respectively): |
||||||
Class A Shares (a) |
$ | 10.00 | ||||
Class C Shares (b) |
$ | 10.13 | ||||
Institutional Service Class Shares |
$ | 10.02 | ||||
Institutional Class Shares |
$ | 10.02 | ||||
Maximum offering price per share (100%/(100%-maximum sales charge) of net asset value adjusted to the nearest cent): |
||||||
Class A Shares |
$ | 10.23 | ||||
|
|
|||||
Maximum Sales Charge: |
||||||
Class A Shares |
2.25 | % | ||||
|
|
|||||
(a) | For Class A Shares, the redemption price per share is reduced by 0.50% on sales of shares of original purchases of $250,000 or more or that were not subject to a front-end sales charge made within 18 months of the purchase date. |
(b) | For Class C Shares, the redemption price per share is reduced by 1.00% for shares held less than one year. |
The accompanying notes are an integral part of these financial statements.
65
Statement of Operations
For the Year Ended July 31, 2014
Nationwide HighMark Short Term Bond Fund | ||||||
INVESTMENT INCOME: |
||||||
Interest income |
$ | 3,259,884 | ||||
Dividend income |
5,080 | |||||
|
|
|||||
Total Income |
3,264,964 | |||||
|
|
|||||
EXPENSES: |
||||||
Investment advisory fees |
763,450 | |||||
Fund administration fees |
170,838 | |||||
Distribution fees Class A |
108,071 | |||||
Distribution fees Class C |
170,255 | |||||
Administrative servicing fees Class A |
34,679 | |||||
Administrative servicing fees Class C |
4,029 | |||||
Administrative servicing fees Institutional Service Class (a) |
49,894 | |||||
Registration and filing fees |
45,670 | |||||
Professional fees |
52,219 | |||||
Printing fees |
23,023 | |||||
Trustee fees |
5,565 | |||||
Custodian fees |
7,532 | |||||
Accounting and transfer agent fees |
20,879 | |||||
Compliance program costs (Note 3) |
1,812 | |||||
Other |
25,181 | |||||
|
|
|||||
Total expenses before earnings credit, fees waived, and expenses reimbursed |
1,483,097 | |||||
|
|
|||||
Earnings credit (Note 4) |
(303 | ) | ||||
Administrative servicing fees voluntarily waived Class A (Note 3) |
(11,127 | ) | ||||
Administrative servicing fees voluntarily waived Institutional Service Class (Note 3) (a) |
(23,377 | ) | ||||
Expenses reimbursed by adviser (Note 3) |
(44,063 | ) | ||||
|
|
|||||
Net Expenses |
1,404,227 | |||||
|
|
|||||
NET INVESTMENT INCOME |
1,860,737 | |||||
|
|
|||||
REALIZED/UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: |
||||||
Net realized gains from investment transactions |
380,353 | |||||
Net change in unrealized appreciation/(depreciation) from investments |
(246,267 | ) | ||||
|
|
|||||
Net realized/unrealized gains from investments |
134,086 | |||||
|
|
|||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS |
$ | 1,994,823 | ||||
|
|
|||||
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
The accompanying notes are an integral part of these financial statements.
66
Statements of Changes in Net Assets
Nationwide HighMark Short Term Bond Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
Operations: |
||||||||||||
Net investment income |
$ | 1,860,737 | $ | 1,718,409 | ||||||||
Net realized gains from investments |
380,353 | 722,040 | ||||||||||
Net change in unrealized appreciation/(depreciation) from investments |
(246,267 | ) | (1,929,412 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets resulting from operations |
1,994,823 | 511,037 | ||||||||||
|
|
|
|
|||||||||
Distributions to Shareholders From: |
||||||||||||
Net investment income: |
||||||||||||
Class A |
(421,351 | ) | (505,762 | ) | ||||||||
Class C |
(116,588 | ) | (224,745 | ) | ||||||||
Institutional Service Class (a) |
(1,084,475 | ) | (1,693,174 | ) | ||||||||
Institutional Class |
(759,644 | )(b) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from shareholder distributions |
(2,382,058 | ) | (2,423,681 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
237,400,971 | 7,588,632 | ||||||||||
|
|
|
|
|||||||||
Change in net assets |
237,013,736 | 5,675,988 | ||||||||||
|
|
|
|
|||||||||
Net Assets: |
||||||||||||
Beginning of year |
164,582,130 | 158,906,142 | ||||||||||
|
|
|
|
|||||||||
End of year |
$ | 401,595,866 | $ | 164,582,130 | ||||||||
|
|
|
|
|||||||||
Accumulated distributions in excess of net investment income at end of year |
$ | (63,539 | ) | $ | | |||||||
|
|
|
|
|||||||||
CAPITAL TRANSACTIONS: |
||||||||||||
Class A Shares (Note 10) |
||||||||||||
Proceeds from shares issued |
$ | 14,428,646 | $ | 37,806,686 | ||||||||
Dividends reinvested |
253,950 | 430,908 | ||||||||||
Cost of shares redeemed |
(15,788,849 | ) | (25,347,925 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
(1,106,253 | ) | 12,889,669 | |||||||||
|
|
|
|
|||||||||
Class C Shares (Note 10) |
||||||||||||
Proceeds from shares issued |
3,083,868 | 11,724,804 | ||||||||||
Dividends reinvested |
98,147 | 173,180 | ||||||||||
Cost of shares redeemed |
(10,854,637 | ) | (9,478,565 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
(7,672,622 | ) | 2,419,419 | |||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 10) (a) |
||||||||||||
Proceeds from shares issued |
26,125,044 | 39,762,430 | ||||||||||
Dividends reinvested |
451,406 | 851,530 | ||||||||||
Cost of shares redeemed |
(37,025,340 | ) | (48,334,416 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
(10,448,890 | ) | (7,720,456 | ) | ||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Proceeds from shares issued |
353,705,935 | (b) | | |||||||||
Dividends reinvested |
759,318 | (b) | | |||||||||
Cost of shares redeemed |
(97,836,517 | )(b) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
256,628,736 | (b) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
$ | 237,400,971 | $ | 7,588,632 | ||||||||
|
|
|
|
|||||||||
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(b) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
67
Statements of Changes in Net Assets (Continued)
Nationwide HighMark Short Term Bond Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
SHARE TRANSACTIONS: |
||||||||||||
Class A Shares (Note 10) |
||||||||||||
Issued |
1,440,475 | 3,759,066 | ||||||||||
Reinvested |
25,361 | 42,721 | ||||||||||
Redeemed |
(1,576,599 | ) | (2,521,226 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
(110,763 | ) | 1,280,561 | |||||||||
|
|
|
|
|||||||||
Class C Shares (Note 10) |
||||||||||||
Issued |
304,287 | 1,146,731 | ||||||||||
Reinvested |
9,682 | 16,954 | ||||||||||
Redeemed |
(1,070,660 | ) | (928,566 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
(756,691 | ) | 235,119 | |||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 10) (a) |
||||||||||||
Issued |
2,605,575 | 3,931,680 | ||||||||||
Reinvested |
45,019 | 84,306 | ||||||||||
Redeemed |
(3,693,645 | ) | (4,797,488 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
(1,043,051 | ) | (781,502 | ) | ||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Issued |
35,243,596 | (b) | | |||||||||
Reinvested |
75,648 | (b) | | |||||||||
Redeemed |
(9,745,303 | )(b) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
25,573,941 | (b) | | |||||||||
|
|
|
|
|||||||||
Total change in shares |
23,663,436 | 734,178 | ||||||||||
|
|
|
|
|||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(b) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
68
Financial Highlights
Selected data for each share of capital outstanding throughout the periods indicated
Nationwide HighMark Short Term Bond Fund
Operations | Distributions | Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period |
Net Investment Income |
Net Realized and Unrealized Gains (Losses) from Investments |
Total from Operations |
Net Investment Income |
Total Distributions |
Net Asset Value, End of Period |
Total Return (a)(b)(c) |
Net Assets at End of Period |
Ratio of Expenses to Average Net Assets (d) |
Ratio of Net Investment Income to Average Net Assets (d) |
Ratio of Expenses (Prior to Reimbursements) to Average Net Assets (d)(e) |
Portfolio Turnover (f) |
||||||||||||||||||||||||||||||||||||||||
Class A Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 10.00 | 0.07 | 0.03 | 0.10 | (0.10 | ) | (0.10 | ) | $ | 10.00 | 0.98% | $ | 43,251,067 | 0.81% | 0.72% | 0.86% | 52.08% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 10.11 | 0.09 | (0.07 | ) | 0.02 | (0.13 | ) | (0.13 | ) | $ | 10.00 | 0.22% | $ | 44,364,179 | 0.85% | 0.89% | 1.19% | 62.00% | |||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 10.09 | 0.17 | 0.05 | 0.22 | (0.20 | ) | (0.20 | ) | $ | 10.11 | 2.18% | $ | 31,888,147 | 0.88% | 1.71% | 1.22% | 45.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 10.10 | 0.19 | 0.02 | 0.21 | (0.22 | ) | (0.22 | ) | $ | 10.09 | 2.07% | $ | 24,352,508 | 0.95% | 1.89% | 1.23% | 48.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 9.98 | 0.24 | 0.14 | 0.38 | (0.26 | ) | (0.26 | ) | $ | 10.10 | 3.86% | $ | 22,581,313 | 0.94% | 2.39% | 1.24% | 27.00% | ||||||||||||||||||||||||||||||||||
Class C Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 10.13 | 0.03 | 0.02 | 0.05 | (0.05 | ) | (0.05 | ) | $ | 10.13 | 0.50% | $ | 19,025,184 | 1.26% | 0.26% | 1.30% | 52.08% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 10.24 | 0.05 | (0.07 | ) | (0.02 | ) | (0.09 | ) | (0.09 | ) | $ | 10.13 | (0.24% | ) | $ | 26,690,172 | 1.30% | 0.44% | 1.44% | 62.00% | |||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 10.21 | 0.13 | 0.05 | 0.18 | (0.15 | ) | (0.15 | ) | $ | 10.24 | 1.79% | $ | 24,569,388 | 1.33% | 1.26% | 1.47% | 45.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 10.22 | 0.15 | 0.01 | 0.16 | (0.17 | ) | (0.17 | ) | $ | 10.21 | 1.59% | $ | 20,876,269 | 1.40% | 1.44% | 1.48% | 48.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 10.10 | 0.20 | 0.14 | 0.34 | (0.22 | ) | (0.22 | ) | $ | 10.22 | 3.37% | $ | 17,565,330 | 1.39% | 1.94% | 1.49% | 27.00% | ||||||||||||||||||||||||||||||||||
Institutional Service Class Shares (h) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 10.02 | 0.10 | 0.03 | 0.13 | (0.13 | ) | (0.13 | ) | $ | 10.02 | 1.26% | $ | 83,068,672 | 0.54% | 1.00% | 0.59% | 52.08% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 10.13 | 0.12 | (0.07 | ) | 0.05 | (0.16 | ) | (0.16 | ) | $ | 10.02 | 0.48% | $ | 93,527,779 | 0.59% | 1.16% | 0.94% | 62.00% | |||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 10.10 | 0.20 | 0.05 | 0.25 | (0.22 | ) | (0.22 | ) | $ | 10.13 | 2.55% | $ | 102,448,607 | 0.61% | 1.98% | 0.97% | 45.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 10.12 | 0.22 | 0.01 | 0.23 | (0.25 | ) | (0.25 | ) | $ | 10.10 | 2.35% | $ | 87,476,317 | 0.67% | 2.17% | 0.98% | 48.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 10.00 | 0.27 | 0.14 | 0.41 | (0.29 | ) | (0.29 | ) | $ | 10.12 | 4.04% | $ | 71,121,675 | 0.66% | 2.67% | 0.99% | 27.00% | ||||||||||||||||||||||||||||||||||
Institutional Class Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Period Ended July 31, 2014 (g)(i) |
$ | 10.01 | 0.09 | 0.03 | 0.12 | (0.11 | ) | (0.11 | ) | $ | 10.02 | 1.19% | $ | 256,250,943 | 0.48% | 0.99% | 0.48% | 52.08% | ||||||||||||||||||||||||||||||||||
(a) | Excludes sales charge. |
(b) | Not annualized for periods less than one year. |
(c) | Total returns prior to the Funds inception on September 16, 2013 are based on the performance of the Funds predecessor fund. |
(d) | Annualized for periods less than one year. |
(e) | During the period, certain fees may have been waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(f) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(g) | Per share calculations were performed using average shares method. |
(h) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(i) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. Total return is calculated based on inception date of September 18, 2013 through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
69
Fund Commentary | Nationwide Ziegler Wisconsin Tax Exempt Fund |
70
Fund Commentary (cont.) | Nationwide Ziegler Wisconsin Tax Exempt Fund |
71
Fund Overview | Nationwide Ziegler Wisconsin Tax Exempt Fund |
| Percentages indicated are based upon net assets as of July 31, 2014. |
| Percentages indicated are based upon total investments as of July 31, 2014. |
72
Fund Performance | Nationwide Ziegler Wisconsin Tax Exempt Fund |
73
Fund Performance (cont.) | Nationwide Ziegler Wisconsin Tax Exempt Fund |
Performance of a $10,000 Investment
Investment return and principal value will fluctuate, and when redeemed, shares may be worth more or less than original cost. Past performance is no guarantee of future results and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Investing in mutual funds involves market risk, including loss of principal. Performance returns assume the reinvestment of all distributions.
Comparative performance of $10,000 invested in Class A shares of the Nationwide Ziegler Wisconsin Tax Exempt Fund versus the Barclays Municipal Bond Index and the Consumer Price Index (CPI) over the 10-year period ended 7/31/14. Fund performance prior to the Funds inception on 9/16/13 is based on the Funds predecessor fund. Unlike the Fund, the performance for these unmanaged indexes does not reflect any fees, expenses, or sales charges. One cannot invest directly in a market index. A description of the benchmarks can be found on the Market Index Definitions page at the back of this book.
74
Shareholder Expense Example | Nationwide Ziegler Wisconsin Tax Exempt Fund |
Schedule of Shareholder Expenses
Expense Analysis of a $1,000 Investment
Nationwide Ziegler Wisconsin July 31, 2014 |
Beginning Account Value ($) 02/01/14 |
Ending Account Value ($) 07/31/14 |
Expenses Paid During Period ($) 02/01/14 - 07/31/14 |
Expense Ratio During Period (%) 02/01/14 - 07/31/14 | ||||||||
Class A Shares | Actual | (a) | 1,000.00 | 1,021.50 | 4.51 | 0.90 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,020.33 | 4.51 | 0.90 | |||||||
Class C Shares | Actual | (a) | 1,000.00 | 1,020.30 | 6.76 | 1.35 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,018.10 | 6.76 | 1.35 | |||||||
Institutional Service Class Shares(c) | Actual | (a) | 1,000.00 | 1,022.70 | 3.26 | 0.65 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,021.57 | 3.26 | 0.65 | |||||||
Institutional Class Shares | Actual | (a) | 1,000.00 | 1,023.00 | 3.01 | 0.60 | ||||||
Hypothetical | (a)(b) | 1,000.00 | 1,021.82 | 3.01 | 0.60 |
(a) | Expenses are equal to the Funds annualized expense ratio multiplied by the average account value from February 1, 2014 through July 31, 2014 multiplied to reflect one-half year period. The expense ratio presented represents a six-month, annualized ratio in accordance with Securities and Exchange Commission guidelines. |
(b) | Represents the hypothetical 5% return before expenses. |
(c) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
75
Statement of Investments
July 31, 2014
Nationwide Ziegler Wisconsin Tax Exempt Fund
76
Statement of Investments (Continued)
July 31, 2014
Nationwide Ziegler Wisconsin Tax Exempt Fund (Continued)
77
Statement of Investments (Continued)
July 31, 2014
Nationwide Ziegler Wisconsin Tax Exempt Fund (Continued)
78
Statement of Investments (Continued)
July 31, 2014
Nationwide Ziegler Wisconsin Tax Exempt Fund (Continued)
The accompanying notes are an integral part of these financial statements.
79
Statement of Assets and Liabilities
July 31, 2014
Nationwide Ziegler Wisconsin Tax Exempt Fund | ||||||
Assets: |
||||||
Investments, at value (cost $120,052,245) |
$ | 122,502,816 | ||||
Interest and dividends receivable |
1,450,051 | |||||
Receivable for investments sold |
2,102,309 | |||||
Receivable for capital shares issued |
73 | |||||
Prepaid expenses |
2,813 | |||||
|
|
|||||
Total Assets |
126,058,062 | |||||
|
|
|||||
Liabilities: |
||||||
Payable for investments purchased |
3,000,000 | |||||
Distributions payable |
35,605 | |||||
Payable for capital shares redeemed |
123,296 | |||||
Accrued expenses and other payables: |
||||||
Investment advisory fees |
44,496 | |||||
Fund administration fees |
10,591 | |||||
Distribution fees |
31,447 | |||||
Administrative servicing fees |
14,941 | |||||
Accounting and transfer agent fees |
6,865 | |||||
Trustee fees |
510 | |||||
Custodian fees |
582 | |||||
Compliance program costs (Note 3) |
1,174 | |||||
Professional fees |
31,339 | |||||
Printing fees |
7,250 | |||||
Other |
3,603 | |||||
|
|
|||||
Total Liabilities |
3,311,699 | |||||
|
|
|||||
Net Assets |
$ | 122,746,363 | ||||
|
|
|||||
Represented by: |
||||||
Capital |
$ | 125,299,981 | ||||
Accumulated undistributed net investment income |
14,362 | |||||
Accumulated net realized losses from investments |
(5,018,551 | ) | ||||
Net unrealized appreciation/(depreciation) from investments |
2,450,571 | |||||
|
|
|||||
Net Assets |
$ | 122,746,363 | ||||
|
|
|||||
Net Assets: |
||||||
Class A Shares |
$ | 109,711,271 | ||||
Class C Shares |
12,554,401 | |||||
Institutional Service Class Shares |
470,359 | |||||
Institutional Class Shares |
10,332 | |||||
|
|
|||||
Total |
$ | 122,746,363 | ||||
|
|
|||||
Shares Outstanding (unlimited number of shares authorized): |
||||||
Class A Shares |
10,862,053 | |||||
Class C Shares |
1,244,611 | |||||
Institutional Service Class Shares |
46,571 | |||||
Institutional Class Shares |
1,023 | |||||
|
|
|||||
Total |
12,154,258 | |||||
|
|
|||||
80
Statement of Assets and Liabilities (Continued)
July 31, 2014
Nationwide Ziegler Wisconsin Tax Exempt Fund | ||||||
Net asset value and redemption price per share (Net assets by class divided by shares outstanding by class, respectively): |
||||||
Class A Shares (a) |
$ | 10.10 | ||||
Class C Shares (b) |
$ | 10.09 | ||||
Institutional Service Class Shares |
$ | 10.10 | ||||
Institutional Class Shares |
$ | 10.10 | ||||
Maximum offering price per share (100%/(100%-maximum sales charge) of net asset value adjusted to the nearest cent): |
||||||
Class A Shares |
$ | 10.33 | ||||
|
|
|||||
Maximum Sales Charge: |
||||||
Class A Shares |
2.25 | % | ||||
|
|
|||||
(a) | For Class A Shares, the redemption price per share is reduced by 0.50% on sales of shares of original purchases of $250,000 or more or that were not subject to a front-end sales charge made within 18 months of the purchase date. |
(b) | For Class C Shares, the redemption price per share is reduced by 1.00% for shares held less than one year. |
The accompanying notes are an integral part of these financial statements.
81
Statement of Operations
For the Year Ended July 31, 2014
Nationwide Ziegler Wisconsin Tax Exempt Fund | ||||||
INVESTMENT INCOME: |
||||||
Interest income |
$ | 5,197,950 | ||||
Dividend income |
1,428 | |||||
|
|
|||||
Total Income |
5,199,378 | |||||
|
|
|||||
EXPENSES: |
||||||
Investment advisory fees |
661,898 | |||||
Fund administration fees |
155,297 | |||||
Distribution fees Class A |
293,988 | |||||
Distribution fees Class B (a) |
393 | |||||
Distribution fees Class C |
106,293 | |||||
Administrative servicing fees Class A |
85,292 | |||||
Administrative servicing fees Class B (a) |
131 | |||||
Administrative servicing fees Class C |
2,141 | |||||
Administrative servicing fees Institutional Service Class (b) |
515 | |||||
Registration and filing fees |
20,165 | |||||
Professional fees |
46,206 | |||||
Printing fees |
23,049 | |||||
Trustee fees |
3,068 | |||||
Custodian fees |
5,222 | |||||
Accounting and transfer agent fees |
30,147 | |||||
Compliance program costs (Note 3) |
1,611 | |||||
Other |
21,348 | |||||
|
|
|||||
Total expenses before earnings credit, fees waived, and expenses reimbursed |
1,456,764 | |||||
|
|
|||||
Earnings credit (Note 4) |
(236 | ) | ||||
Administrative servicing fees voluntarily waived Class A (Note 3) |
(32,166 | ) | ||||
Administrative servicing fees voluntarily waived Institutional Service Class (Note 3) (b) |
(185 | ) | ||||
Expenses reimbursed by adviser (Note 3) |
(170,502 | ) | ||||
|
|
|||||
Net Expenses |
1,253,675 | |||||
|
|
|||||
NET INVESTMENT INCOME |
3,945,703 | |||||
|
|
|||||
REALIZED/UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: |
||||||
Net realized losses from investment transactions |
(4,759,889 | ) | ||||
Net change in unrealized appreciation/(depreciation) from investments |
1,844,901 | |||||
|
|
|||||
Net realized/unrealized losses from investments |
(2,914,988 | ) | ||||
|
|
|||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS |
$ | 1,030,715 | ||||
|
|
|||||
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
The accompanying notes are an integral part of these financial statements.
82
Statements of Changes in Net Assets
Nationwide Ziegler Wisconsin Tax Exempt Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
Operations: |
||||||||||||
Net investment income |
$ | 3,945,703 | $ | 4,558,938 | ||||||||
Net realized gains/(losses) from investments |
(4,759,889 | ) | 119,834 | |||||||||
Net change in unrealized appreciation/(depreciation) from investments |
1,844,901 | (9,152,540 | ) | |||||||||
|
|
|
|
|||||||||
Change in net assets resulting from operations |
1,030,715 | (4,473,768 | ) | |||||||||
|
|
|
|
|||||||||
Distributions to Shareholders From: |
||||||||||||
Net investment income: |
||||||||||||
Class A |
(3,547,872 | ) | (4,059,716 | ) | ||||||||
Class B (a) |
(701 | ) | (18,645 | ) | ||||||||
Class C |
(364,785 | ) | (459,370 | ) | ||||||||
Institutional Service Class (b) |
(17,644 | ) | (35,247 | ) | ||||||||
Institutional Class |
(299 | )(c) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from shareholder distributions |
(3,931,301 | ) | (4,572,978 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
(26,358,317 | ) | (4,957,196 | ) | ||||||||
|
|
|
|
|||||||||
Change in net assets |
(29,258,903 | ) | (14,003,942 | ) | ||||||||
|
|
|
|
|||||||||
Net Assets: |
||||||||||||
Beginning of year |
152,005,266 | 166,009,208 | ||||||||||
|
|
|
|
|||||||||
End of year |
$ | 122,746,363 | $ | 152,005,266 | ||||||||
|
|
|
|
|||||||||
Accumulated undistributed net investment income at end of year |
$ | 14,362 | $ | | ||||||||
|
|
|
|
|||||||||
CAPITAL TRANSACTIONS: |
||||||||||||
Class A Shares (Note 10) |
||||||||||||
Proceeds from shares issued |
$ | 2,131,046 | $ | 11,633,693 | ||||||||
Proceeds from shares issued from class conversion |
332,070 | | ||||||||||
Dividends reinvested |
2,876,602 | 3,074,159 | ||||||||||
Cost of shares redeemed |
(26,060,405 | ) | (20,534,726 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
(20,720,687 | ) | (5,826,874 | ) | ||||||||
|
|
|
|
|||||||||
Class B Shares (Note 10) (a) |
||||||||||||
Proceeds from shares issued |
| 8,299 | ||||||||||
Dividends reinvested |
602 | 7,893 | ||||||||||
Cost of shares redeemed in class conversion |
(332,070 | ) | | |||||||||
Cost of shares redeemed |
(164,770 | ) | (523,647 | ) | ||||||||
|
|
|
|
|||||||||
Total Class B Shares |
(496,238 | ) | (507,455 | ) | ||||||||
|
|
|
|
|||||||||
Class C Shares (Note 10) |
||||||||||||
Proceeds from shares issued |
353,590 | 4,810,457 | ||||||||||
Dividends reinvested |
309,049 | 368,866 | ||||||||||
Cost of shares redeemed |
(5,366,869 | ) | (4,087,279 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
(4,704,230 | ) | 1,092,044 | |||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 10) (b) |
||||||||||||
Proceeds from shares issued |
230,984 | 1,193,688 | ||||||||||
Dividends reinvested |
13,222 | 26,519 | ||||||||||
Cost of shares redeemed |
(691,685 | ) | (935,118 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
(447,479 | ) | 285,089 | |||||||||
|
|
|
|
|||||||||
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(c) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
83
Statements of Changes in Net Assets (Continued)
Nationwide Ziegler Wisconsin Tax Exempt Fund | ||||||||||||
Year Ended July 31, 2014 |
Year Ended July 31, 2013 | |||||||||||
CAPITAL TRANSACTIONS: (continued) |
||||||||||||
Institutional Class Shares |
||||||||||||
Proceeds from shares issued |
$ | 14,119 | (c) | $ | | |||||||
Dividends reinvested |
292 | (c) | | |||||||||
Cost of shares redeemed |
(4,094 | )(c) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
10,317 | (c) | | |||||||||
|
|
|
|
|||||||||
Change in net assets from capital transactions |
$ | (26,358,317 | ) | $ | (4,957,196 | ) | ||||||
|
|
|
|
|||||||||
SHARE TRANSACTIONS: |
||||||||||||
Class A Shares (Note 10) |
||||||||||||
Issued |
211,499 | 1,075,462 | ||||||||||
Issued in class conversion |
33,262 | | ||||||||||
Reinvested |
284,348 | 286,146 | ||||||||||
Redeemed |
(2,580,977 | ) | (1,920,307 | ) | ||||||||
|
|
|
|
|||||||||
Total Class A Shares |
(2,051,868 | ) | (558,699 | ) | ||||||||
|
|
|
|
|||||||||
Class B Shares (Note 10) (a) |
||||||||||||
Issued |
| 772 | ||||||||||
Reinvested |
59 | 735 | ||||||||||
Redeemed in class conversion |
(33,303 | ) | | |||||||||
Redeemed |
(16,248 | ) | (49,457 | ) | ||||||||
|
|
|
|
|||||||||
Total Class B Shares |
(49,492 | ) | (47,950 | ) | ||||||||
|
|
|
|
|||||||||
Class C Shares (Note 10) |
||||||||||||
Issued |
35,074 | 445,674 | ||||||||||
Reinvested |
30,594 | 34,392 | ||||||||||
Redeemed |
(533,181 | ) | (386,759 | ) | ||||||||
|
|
|
|
|||||||||
Total Class C Shares |
(467,513 | ) | 93,307 | |||||||||
|
|
|
|
|||||||||
Institutional Service Class Shares (Note 10) (b) |
||||||||||||
Issued |
22,934 | 110,801 | ||||||||||
Reinvested |
1,307 | 2,468 | ||||||||||
Redeemed |
(68,103 | ) | (87,654 | ) | ||||||||
|
|
|
|
|||||||||
Total Institutional Service Class Shares |
(43,862 | ) | 25,615 | |||||||||
|
|
|
|
|||||||||
Institutional Class Shares |
||||||||||||
Issued |
1,404 | (c) | | |||||||||
Reinvested |
29 | (c) | | |||||||||
Redeemed |
(410 | )(c) | | |||||||||
|
|
|
|
|||||||||
Total Institutional Class Shares |
1,023 | (c) | | |||||||||
|
|
|
|
|||||||||
Total change in shares |
(2,611,712 | ) | (487,727 | ) | ||||||||
|
|
|
|
|||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Effective September 16, 2013, Class B Shares converted into Class A Shares. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(c) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
84
Financial Highlights
Selected data for each share of capital outstanding throughout the periods indicated
Nationwide Ziegler Wisconsin Tax Exempt Fund
Operations | Distributions | Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period |
Net Investment Income |
Net Realized and Unrealized Gains (Losses) from Investments |
Total from Operations |
Net Investment Income |
Net Realized Gains |
Total Distributions |
Net Asset Value, End of Period |
Total Return (a)(b)(c) |
Net Assets at End of Period |
Ratio of Expenses to Average Net Assets (d) |
Ratio of Net Investment Income to Average Net Assets (d) |
Ratio of Expenses (Prior to Reimbursements) to Average Net Assets (d)(e) |
Portfolio Turnover (f) |
|||||||||||||||||||||||||||||||||||||||||||
Class A Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 10.30 | 0.31 | (0.21 | ) | 0.10 | (0.30 | ) | | (0.30 | ) | $ | 10.10 | 1.06% | $ | 109,711,271 | 0.90% | 3.03% | 1.05% | 8.61% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 10.88 | 0.30 | (0.58 | ) | (0.28 | ) | (0.30 | ) | | (0.30 | ) | $ | 10.30 | (2.65% | ) | $ | 132,960,429 | 0.90% | 2.79% | 1.29% | 14.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 10.37 | 0.34 | 0.51 | 0.85 | (0.34 | ) | | (0.34 | ) | $ | 10.88 | 8.30% | $ | 146,648,612 | 0.90% | 3.17% | 1.31% | 13.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 10.52 | 0.36 | (0.13 | ) | 0.23 | (0.37 | ) | (0.01 | ) | (0.38 | ) | $ | 10.37 | 2.28% | $ | 130,165,154 | 0.90% | 3.53% | 1.31% | 10.00% | |||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 10.10 | 0.36 | 0.42 | 0.78 | (0.36 | ) | | (0.36 | ) | $ | 10.52 | 7.95% | $ | 146,664,880 | 0.90% | 3.45% | 1.29% | 13.00% | |||||||||||||||||||||||||||||||||||||
Class C Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 10.28 | 0.26 | (0.19 | ) | 0.07 | (0.26 | ) | | (0.26 | ) | $ | 10.09 | 0.71% | $ | 12,554,401 | 1.35% | 2.58% | 1.50% | 8.61% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 10.87 | 0.25 | (0.59 | ) | (0.34 | ) | (0.25 | ) | | (0.25 | ) | $ | 10.28 | (3.18% | ) | $ | 17,604,748 | 1.35% | 2.34% | 1.54% | 14.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 10.36 | 0.29 | 0.51 | 0.80 | (0.29 | ) | | (0.29 | ) | $ | 10.87 | 7.82% | $ | 17,595,471 | 1.35% | 2.71% | 1.56% | 13.00% | |||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2011 (g) |
$ | 10.51 | 0.32 | (0.14 | ) | 0.18 | (0.32 | ) | (0.01 | ) | (0.33 | ) | $ | 10.36 | 1.93% | $ | 10,831,411 | 1.35% | 3.08% | 1.56% | 10.00% | |||||||||||||||||||||||||||||||||||
Year Ended July 31, 2010 (g) |
$ | 10.09 | 0.31 | 0.43 | 0.74 | (0.32 | ) | | (0.32 | ) | $ | 10.51 | 7.37% | $ | 10,156,665 | 1.35% | 3.00% | 1.54% | 13.00% | |||||||||||||||||||||||||||||||||||||
Institutional Service Class Shares (h) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2014 (g) |
$ | 10.30 | 0.33 | (0.20 | ) | 0.13 | (0.33 | ) | | (0.33 | ) | $ | 10.10 | 1.31% | $ | 470,359 | 0.65% | 3.28% | 0.83% | 8.61% | ||||||||||||||||||||||||||||||||||||
Year Ended July 31, 2013 (g) |
$ | 10.88 | 0.33 | (0.58 | ) | (0.25 | ) | (0.33 | ) | | (0.33 | ) | $ | 10.30 | (2.40% | ) | $ | 931,021 | 0.65% | 3.04% | 1.04% | 14.00% | ||||||||||||||||||||||||||||||||||
Year Ended July 31, 2012 (g) |
$ | 10.37 | 0.36 | 0.52 | 0.88 | (0.37 | ) | | (0.37 | ) | $ | 10.88 | 8.57% | $ | 705,422 | 0.65% | 3.42% | 1.06% | 13.00% | |||||||||||||||||||||||||||||||||||||
Period Ended July 31, 2011 (g)(i) |
$ | 10.52 | 0.38 | (0.12 | ) | 0.26 | (0.40 | ) | (0.01 | ) | (0.41 | ) | $ | 10.37 | 2.45% | $ | 281,684 | 0.65% | 3.78% | 1.06% | 10.00% | |||||||||||||||||||||||||||||||||||
Institutional Class Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Period Ended July 31, 2014 (g)(j) |
$ | 10.06 | 0.29 | 0.04 | 0.33 | (0.29 | ) | | (0.29 | ) | $ | 10.10 | 3.32% | $ | 10,332 | 0.60% | 3.34% | 0.71% | 8.61% | |||||||||||||||||||||||||||||||||||||
Amounts designated as are zero or have been rounded to zero.
(a) | Excludes sales charge. |
(b) | Not annualized for periods less than one year. |
(c) | Total returns prior to the Funds inception on September 16, 2013 are based on the performance of the Funds predecessor fund. |
(d) | Annualized for periods less than one year. |
(e) | During the period, certain fees may have been waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(f) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(g) | Per share calculations were performed using average shares method. |
(h) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
(i) | For the period from August 3, 2010 (commencement of operations) through July 31, 2011. |
(j) | For the period from September 19, 2013 (commencement of operations) through July 31, 2014. Total return is calculated based on inception date of September 18, 2013 through July 31, 2014. |
The accompanying notes are an integral part of these financial statements.
85
July 31, 2014
1. Organization
Nationwide Mutual Funds (the Trust) is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company, organized as a statutory trust under the laws of the State of Delaware. The Trust has authorized an unlimited number of shares of beneficial interest (shares), without par value. As of July 31, 2014, the Trust operates fifty-six (56) separate series, or mutual funds, each with its own investment objective(s) and strategies. This report contains the financial statements and financial highlights of the five (5) series listed below (each, a Fund; collectively, the Funds).
- Nationwide HighMark Bond Fund (Bond)
- Nationwide HighMark California Intermediate Tax Free Bond Fund (California Intermediate Tax Free Bond)
- Nationwide HighMark National Intermediate Tax Free Bond Fund (National Intermediate Tax Free Bond)
- Nationwide HighMark Short Term Bond Fund (Short Term Bond)
- Nationwide Ziegler Wisconsin Tax Exempt Fund (Wisconsin Tax Exempt)
Each Fund commenced operations on September 16, 2013 as a result of a tax free reorganization in which Bond, California Intermediate Tax Free Bond, National Intermediate Tax Free Bond, Short Term Bond, and Wisconsin Tax Exempt acquired all of the assets, subject to all liabilities and obligations, of the HighMark Bond Fund, HighMark California Intermediate Tax-Free Bond Fund, HighMark National Intermediate Tax-Free Bond Fund, HighMark Short Term Bond Fund, and HighMark Wisconsin Tax-Exempt Fund, respectively, each a former series of HighMark Funds (each a Predecessor Fund, and collectively the Predecessor Funds). Each Fund has adopted the historical performance of its corresponding Predecessor Fund. Each Fund and its corresponding Predecessor Fund have substantially similar investment goals and strategies.
Each of the Funds, except Wisconsin Tax Exempt, is a diversified fund, as defined in the 1940 Act. Wisconsin Tax Exempt is a non-diversified fund, as defined in the 1940 Act.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Funds in the preparation of their financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP). The preparation of financial statements requires Fund management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of income and expenses for the period. The Funds utilize various methods to measure the value of their investments on a recurring basis. Amounts received upon the sale of such investments could differ from those estimated values and those differences could be material.
(a) | Security Valuation |
U.S. GAAP defines fair value as the price that a Fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. The Trusts investment adviser to the Funds, Nationwide Fund Advisors (NFA), assigns a fair value, as defined by U.S. GAAP, to a Funds investments in accordance with a hierarchy that prioritizes the various types of inputs used to measure fair value. The hierarchy gives the highest priority to readily available unadjusted quoted prices in active markets for identical assets (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements) when market prices are not readily available or reliable.
The three levels of the hierarchy are summarized below.
| Level 1 Quoted prices in active markets for identical assets |
| Level 2 Other significant observable inputs (including quoted prices of similar securities, interest rates, prepayment speeds, credit risk, etc.) |
86
Notes to Financial Statements (Continued)
July 31, 2014
| Level 3 Significant unobservable inputs (including a Funds own assumptions in determining the fair value of investments) |
Changes in valuation techniques may result in transfers into or out of an investments assigned level within the hierarchy.
An investments categorization within the hierarchy is based on the lowest level of any input that is significant to the fair valuation in its entirety. The inputs or methodology used to value investments are not intended to indicate the risk associated with investing in those investments.
Securities for which market-based quotations are readily available are valued at the current market value as of Valuation Time. Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4:00 p.m. Eastern time). Shares of registered open-end management investment companies are valued at net asset value (NAV) as reported by such company. Investments valued in this manner are generally categorized as Level 1 investments within the hierarchy.
Debt and other fixed-income securities are generally valued at the bid evaluation price provided by an independent pricing service as approved by the Board of Trustees. Evaluations provided by independent pricing service providers may be determined without exclusive reliance on quoted prices and may use broker-dealer quotations, individual trading characteristics and other market data, reported trades or valuation estimates from their internal pricing models. The independent pricing service providers internal models use inputs that are observable such as issuer details, interest rates, yield curves, prepayment speeds, credit risks/spreads, default rates, anticipated timing of principal repayments, and quoted prices for similar assets and are generally categorized as Level 2 investments within the hierarchy. Debt obligations generally involve some risk of default with respect to interest and/or principal payments.
Municipal securities are fair valued as determined by an independent pricing service. The independent pricing service utilizes internal models and uses observable inputs such as: (i) yields or prices of municipal securities of comparable quality, coupon, maturity and type; (ii) indications as to values from dealers; and (iii) general market conditions. Municipal securities are categorized within Level 2 of the fair value hierarchy.
The Board of Trustees has delegated authority to NFA, and the Trusts administrator, Nationwide Fund Management LLC (NFM), to assign a fair value under certain circumstances (e.g., pricing service does not provide a price as there may be no market-based quotations or price provided is deemed unreliable by NFA, NFM and/or designee), pursuant to valuation procedures approved by the Board of Trustees. NFA and NFM have established a Fair Valuation Committee (FVC) to assign these fair valuations.
The fair value of a security may differ from its quoted or published price. Fair valuation of portfolio securities may occur on a daily basis.
Securities may be fair valued in a variety of circumstances, such as where (i) market-based quotations are not readily available; (ii) an independent pricing service does not provide a value or the value provided by an independent pricing service is determined to be unreliable in the judgment of NFA or its designee; (iii) a significant event has occurred that affects the value of a Funds securities after trading has stopped (e.g., earnings announcements or news relating to natural disasters affecting an issuers operations); (iv) the securities are illiquid; (v) the securities have defaulted or been delisted from an exchange and are no longer trading; or (vi) any other circumstance in which the FVC believes that market-based quotations do not accurately reflect the value of a security.
The fair valuation of securities takes into account relevant factors and surrounding circumstances, including, but not limited to, the prices of related or comparable assets or liabilities, recent transactions, market multiples, anticipated cash flows, the nature and duration of any restrictions on transfer, book values, and other information relevant to the investment. Methods utilized to determine fair value may include, among others, the following: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity for debt issues; or (iv) a combination of these and other methods. Fair valuations may also take into account
87
Notes to Financial Statements (Continued)
July 31, 2014
significant events that occur before Valuation Time but after the close of the principal market on which a security trades that materially affect the value of such security. The FVC monitors the results of fair valuation determinations and regularly reports the results to the Board of Trustees. That said, there can be no assurance that the fair value assigned to a security is the price at which a security could have been sold during the period in which the particular fair value was used to value the security. To the extent the inputs used are observable these securities are classified as Level 2 otherwise Level 3.
Bank loans are valued using an average bid price provided by an independent pricing service. Evaluated quotes provided by the independent pricing service may reflect appropriate factors such as ratings, tranche type, industry, company performance spread, individual trading characteristics, institution-size trading in similar groups of securities and other market data. The independent pricing service utilizes internal models and uses observable inputs such as issuer details, interest rates, yield curves, credit risk/spreads and quoted prices for similar assets. Securities valued in this manner are generally categorized as Level 2, consistent with similar valuation techniques and inputs described above for debt and equity securities.
At July 31, 2014, 100% of the market value of Bond and Short Term Bond were determined based on Level 2 inputs.
The following tables provide a summary of the inputs used to value the Funds net assets as of July 31, 2014. Please refer to the Statements of Investments for additional information on portfolio holdings.
California Intermediate Tax Free Bond
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: |
||||||||||||||||
Municipal Bonds |
$ | | $ | 183,751,424 | $ | | $ | 183,751,424 | ||||||||
Mutual Fund |
2,568,639 | | | 2,568,639 | ||||||||||||
Total |
$ | 2,568,639 | $ | 183,751,424 | $ | | $ | 186,320,063 |
National Intermediate Tax Free Bond
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: |
||||||||||||||||
Municipal Bonds |
$ | | $ | 69,879,172 | $ | | $ | 69,879,172 | ||||||||
Mutual Fund |
84,157 | | | 84,157 | ||||||||||||
Total |
$ | 84,157 | $ | 69,879,172 | $ | | $ | 69,963,329 |
Wisconsin Tax Exempt
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: |
||||||||||||||||
Municipal Bonds |
$ | | $ | 118,239,137 | $ | | $ | 118,239,137 | ||||||||
Mutual Fund |
4,263,679 | | | 4,263,679 | ||||||||||||
Total |
$ | 4,263,679 | $ | 118,239,137 | $ | | $ | 122,502,816 |
Amounts designated as , which may include fair valued securities, are zero or have been rounded to zero.
During the year ended July 31, 2014, there were no transfers into or out of Level 1, Level 2 or Level 3.
(b) | Securities Lending |
During the period from September 16, 2013 through July 31, 2014, Bond entered into securities lending transactions. To generate additional income, the Funds lent their portfolio securities, up to 33 1/3% of the total assets of each Fund, to brokers, dealers, and other financial institutions. The collateral that a Fund receives is
88
Notes to Financial Statements (Continued)
July 31, 2014
included in calculating the Funds total assets. The Funds securities lending standards and guidelines require that the borrower (i) deliver cash or U.S. Government securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (ii) at all times thereafter mark-to-market the collateral on a daily basis so that the market value of such collateral is at least 100% of the value of securities loaned. A Fund receives payments from the securities lending agent equivalent to the dividends and interest that would have been earned on the securities loaned while simultaneously seeking to earn income on the investment of cash collateral. Income from the securities lending program is recorded when received from the securities lending agent. There may be risks of delay or restrictions in recovery of the securities or disposal of collateral should the borrower of the securities fail financially. Loans are made, however, only to borrowers deemed by the securities lending agent to be of good standing and creditworthy. Loans are subject to termination by a Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. For the period from September 16, 2013 through March 31, 2014, JPMorgan Chase Bank, N.A. (JPMorgan) served as securities lending agent for the securities lending program of the Funds. JPMorgan received a fee based on a percentage of earnings derived from the investment of cash collateral. Effective April 1, 2014, Brown Brothers Harriman & Co. (BBH) began serving as the primary securities lending agent for the securities lending program of the Funds. BBH receives a fee based on the difference between the income earned on the investment of cash collateral received from borrowers and the cash collateral fee. Information on the investment of cash collateral is shown in the Statement of Investments.
For the period from September 16, 2013 through March 31, 2014, in the event of a default by a borrower with respect to any loan, JPMorgan exercised any and all remedies provided under the applicable borrower agreement to make a Fund whole. These remedies included purchasing replacement securities by applying the collateral held from the defaulting borrower against the purchase cost of the replacement securities. If, despite such efforts by JPMorgan to exercise these remedies, a Fund sustained losses as a result of a borrowers default, JPMorgan indemnified the Fund by purchasing replacement securities at its expense, or would pay the Fund an amount equal to the market value of the replacement securities, subject to certain limitations which were set forth in detail in the Securities Lending Agency Agreement between the Funds and JPMorgan. Effective April 1, 2014, in the event of a default by a borrower with respect to any loan, BBH will exercise any and all remedies provided under the applicable borrower agreement to make a Fund whole. These remedies include purchasing replacement securities by applying the collateral held from the defaulting borrower against the purchase cost of the replacement securities. If, despite such efforts by BBH to exercise these remedies, the collateral is less than the purchase cost of the replacement securities, BBH is responsible for such shortfall, subject to certain limitations that are set forth in detail in the Securities Lending Agency Agreement between the Funds and BBH.
At July 31, 2014, the BBH Securities Lending Agreement does not permit the Funds to enforce a netting arrangement.
At July 31, 2014, Bond had no portfolio securities on loan.
Prior to September 16, 2013, the Predecessor Funds did not enter into any securities lending transactions.
(c) | Repurchase Agreements |
For the period from September 16, 2013 through July 31, 2014, Bond, along with other series of the Trust, pursuant to procedures adopted by the Board of Trustees and applicable guidance from the Securities and Exchange Commission (SEC), transferred cash collateral received from securities lending transactions, through a joint account at the securities lending agent, the daily aggregate balance of which is invested in one or more repurchase agreements collateralized by U.S. Treasury or federal agency obligations. In a repurchase agreement, the seller of a security agrees to repurchase the security at a mutually agreed-upon time and price, which reflects the effective rate of return for the term of the agreement. For joint repurchase agreements, The Bank of New York Mellon, JPMorgan or BBH takes possession of the collateral pledged for investments in such repurchase agreements (repo
89
Notes to Financial Statements (Continued)
July 31, 2014
or collectively repos). The underlying collateral is valued daily on a mark-to-market basis to ensure that the value is equal to or greater than the repurchase price including accrued interest. In the event of default of the obligation to repurchase, a Fund has the right to liquidate the collateral and apply the proceeds in satisfaction of the obligation. If the seller defaults and the value of the collateral declines or if bankruptcy proceedings are commenced with respect to the seller of the security, realization of the collateral by a Fund may be delayed or limited.
At July 31, 2014, Bond held no repurchase agreements.
(d) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold. Security gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization of premiums or accretion of discounts, and is recorded as such on a Funds Statement of Operations. Dividend income is recorded on the ex-dividend date and is recorded as such on a Funds Statement of Operations, except for certain dividends from foreign securities, which are recorded as soon as the Trust is informed on or after the ex-dividend date.
(e) | Distributions to Shareholders |
Distributions from net investment income, if any, are declared daily and paid monthly. Prior to September 16, 2013, distributions from net investment income, if any, were declared and paid monthly. Distributions from net realized capital gains, if any, are declared and distributed at least annually. All distributions are recorded on the ex-dividend date.
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from U.S. GAAP. These book/tax differences are considered either permanent or temporary. Permanent differences are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. The permanent differences as of July 31, 2014 are primarily attributable to paydown gains and losses and market discount on sales. These reclassifications have no effect upon the NAV of a Fund. Any distribution in excess of current and accumulated earnings and profits for federal income tax purposes is reported as a return of capital distribution.
Reclassifications for the year ended July 31, 2014 were as follows:
Fund | Capital | Accumulated undistributed net investment income |
Accumulated net realized gains/(losses) from investment transactions |
|||||||||
Bond |
$ | | $ | 302,799 | $ | (302,799 | ) | |||||
California Intermediate Tax Free Bond |
| | | |||||||||
National Intermediate Tax Free Bond |
| | | |||||||||
Short Term Bond |
| 457,782 | (457,782 | ) | ||||||||
Wisconsin Tax Exempt |
| (40 | ) | 40 |
Amounts designated as are zero or have been rounded to zero.
(f) | Deferred Compensation Plan |
On April 17, 2013, the Predecessor Funds terminated a deferred compensation plan that had previously been established for the benefit of certain members of the Predecessor Funds Board. Effective September 16, 2013, the Funds assumed the deferred compensation liability of their corresponding Predecessor Funds. At July 31, 2014, the Funds fully paid the deferred compensation to the Predecessor Funds Board and no liability remained for the Funds.
90
Notes to Financial Statements (Continued)
July 31, 2014
(g) | Federal Income Taxes |
Each Fund elected to be treated as, and intends to qualify each year as, a Regulated Investment Company by complying with the provisions available to certain investment companies under Subchapter M of the U.S. Internal Revenue Code of 1986, as amended, and to make distributions of net investment income and net realized capital gains sufficient to relieve a Fund from all, or substantially all, federal income taxes. Therefore, no federal income tax provision is required.
A Fund recognizes a tax benefit from an uncertain position only if it is more likely than not that the position is sustainable, based solely on its technical merits and consideration of the relevant taxing authorities widely understood administrative practices and precedents. A Fund undertakes an affirmative evaluation of tax positions taken or expected to be taken in the course of preparing tax returns to determine whether it is more likely than not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. If such a tax position taken by a Fund is not sustained upon examination by a taxing authority that Fund could incur taxes and penalties related to that position, and those amounts could be material. A tax position that meets the more likely than not recognition threshold is measured to determine the amount of benefits to recognize in the financial statements. Differences result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). The Funds file U.S. federal income tax returns and, if applicable, returns in various foreign jurisdictions in which they invest. The last four tax year ends, or since inception (if shorter), and any interim tax period since then generally remain open for examination by taxing authorities.
Each Fund engages in ongoing monitoring and analysis; future conclusions reached by management could be different and result in adjustments to a Funds NAV and financial statements. The Funds are not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
(h) | Allocation of Expenses, Income and Gains and Losses |
Expenses directly attributable to a Fund are charged to that Fund. Expenses not directly attributable to a Fund are allocated proportionally among various or all series of the Trust. Income, fund level expenses, and realized and unrealized gains or losses are allocated to each class of shares of a Fund based on the value of the outstanding shares of that class relative to the total value of the outstanding shares of that Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that specific class.
3. Transactions with Affiliates
Effective September 16, 2013 under the terms of the Trusts Investment Advisory Agreement, NFA manages the investments of the assets and supervises the daily business affairs of the Funds in accordance with policies and procedures established by the Board of Trustees. NFA is a wholly owned subsidiary of Nationwide Financial Services, Inc. (NFS), a holding company which is a direct wholly owned subsidiary of Nationwide Corporation. NFA provides investment management evaluation services in monitoring, on an ongoing basis, the performance of the subadvisers.
As of July 31, 2014, the subadvisers for each Fund are as follows:
Fund | Subadviser | |
Bond |
HighMark Capital Management, Inc. (HighMark) | |
California Intermediate Tax Free Bond |
HighMark | |
National Intermediate Tax Free Bond |
HighMark | |
Short Term Bond |
HighMark | |
Wisconsin Tax Exempt |
Ziegler Capital Management, LLC |
91
Notes to Financial Statements (Continued)
July 31, 2014
Effective September 16, 2013, under the terms of the Investment Advisory Agreement, each Fund pays NFA an investment advisory fee based on that Funds average daily net assets. The Funds paid investment advisory fees to NFA according to the schedule below.
Fund | Fee Schedule | Advisory Fee (annual rate) |
||||
Bond |
Up to $250 million | 0.50 | % | |||
$250 million up to $1 billion | 0.475 | % | ||||
$1 billion up to $2 billion | 0.45 | % | ||||
$2 billion up to $5 billion | 0.425 | % | ||||
$5 billion and more | 0.40 | % | ||||
California Intermediate Tax Free Bond |
All Assets | 0.50 | % | |||
National Intermediate Tax Free Bond |
||||||
Short Term Bond |
Up to $500 million | 0.35 | % | |||
$500 million up to $1 billion | 0.34 | % | ||||
$1 billion up to $3 billion | 0.325 | % | ||||
$3 billion up to $5 billion | 0.30 | % | ||||
$5 billion up to $10 billion | 0.285 | % | ||||
$10 billion and more | 0.275 | % | ||||
Wisconsin Tax Exempt |
Up to $250 million | 0.50 | % | |||
On $250 million and more | 0.40 | % |
Prior to September 16, 2013, each Fund paid investment advisory fees to HighMark under a similar agreement based on that Funds average daily net assets. The Funds paid investment advisory fees to HighMark according to the schedule below.
Fund | Fee Schedule | Advisory Fee (annual rate) |
||||
Bond |
All Assets | 0.50 | % | |||
California Intermediate Tax Free Bond |
||||||
National Intermediate Tax Free Bond |
||||||
Short Term Bond |
All Assets | 0.40 | % | |||
Wisconsin Tax Exempt |
Up to $250 million | 0.50 | % | |||
On $250 million and more | 0.40 | % |
For the year ended July 31, 2014, the effective advisory fee rates were as follows:
Fund | Effective Advisory Fee Rate |
|||
Bond |
0.49 | % | ||
California Intermediate Tax Free Bond |
0.50 | |||
National Intermediate Tax Free Bond |
0.50 | |||
Short Term Bond |
0.35 | |||
Wisconsin Tax Exempt |
0.50 |
92
Notes to Financial Statements (Continued)
July 31, 2014
For the period from September 16, 2013 through July 31, 2014, the effective advisory fee rates for fees paid to NFA were as follows:
Fund | Effective Advisory Fee Rate |
|||
Bond |
0.49 | % | ||
California Intermediate Tax Free Bond |
0.50 | |||
National Intermediate Tax Free Bond |
0.50 | |||
Short Term Bond |
0.35 | |||
Wisconsin Tax Exempt |
0.50 |
For the period from September 16, 2013 through July 31, 2014, the Funds paid investment management fees to NFA in the amounts listed below.
Fund | Amount | |||
Bond |
$ | 1,451,224 | ||
California Intermediate Tax Free Bond |
878,116 | |||
National Intermediate Tax Free Bond |
336,499 | |||
Short Term Bond |
681,072 | |||
Wisconsin Tax Exempt |
570,273 |
From these fees, pursuant to the subadvisory agreements, NFA pays fees to the unaffiliated subadvisers.
Prior to September 16, 2013, the Funds were managed by, and paid investment management fees to, HighMark. For the period from August 1, 2013 through September 15, 2013, the Funds paid investment management fees to HighMark in the amounts listed below.
Fund | Amount | |||
Bond |
$ | 219,453 | ||
California Intermediate Tax Free Bond |
140,860 | |||
National Intermediate Tax Free Bond |
53,990 | |||
Short Term Bond |
82,378 | |||
Wisconsin Tax Exempt |
91,625 |
Effective September 16, 2013, the Funds and NFA have entered into a written Expense Limitation Agreement that limits the Funds operating expenses (excluding acquired fund fees and expenses, and certain other expenses) from exceeding the following amounts until February 28, 2015:
Fund | Class A | Class C | Institutional Service Class |
Institutional Class |
||||||||||||
Bond |
0.97 | % | 1.40 | % | 0.72 | % | 0.65 | % | ||||||||
California Intermediate Tax Free Bond |
0.79 | 1.24 | 0.54 | 0.49 | ||||||||||||
National Intermediate Tax Free Bond |
0.77 | 1.22 | 0.52 | 0.47 | ||||||||||||
Short Term Bond(a) |
0.85 | 1.30 | 0.60 | 0.55 | ||||||||||||
Wisconsin Tax Exempt |
0.90 | 1.35 | 0.65 | 0.60 |
(a) | For the period September 16, 2013 through June 30, 2014. |
93
Notes to Financial Statements (Continued)
July 31, 2014
Effective July 1, 2014, the Expense Limitation Agreement between Short Term Bond and NFA was restated and limits the Funds operating expenses (excluding acquired fund fees and expenses, and certain other expenses) from exceeding the following amounts until November 30, 2016.
Fund | Class A | Class C | Institutional Service Class |
Institutional Class |
||||||||||||
Short Term Bond |
0.76 | % | 1.20 | % | 0.51 | % | 0.45 | % |
NFA may request and receive reimbursement from a Fund for advisory fees waived and other expenses reimbursed by NFA pursuant to the Expense Limitation Agreement at a date not to exceed three years from the month in which the corresponding waiver or reimbursement to a Fund was made. However, no reimbursement may be made unless: (i) a Funds assets exceed $100 million and (ii) the total annual expense ratio of the class making such reimbursement is no higher than the amount of the expense limitation that was in place at the time NFA waived the fees or reimbursed the expenses and does not cause the expense ratio to exceed the current expense limitation. Reimbursement by a Fund of amounts previously waived or assumed by NFA is not permitted except as provided for in the Expense Limitation Agreement. The Expense Limitation Agreement may be changed or eliminated only with the consent of the Board of Trustees.
As of July 31, 2014, the cumulative potential reimbursements for the Funds, listed by the period in which NFA waived fees or reimbursed expenses to the Funds, are:
Fund | Period Ended July 31, 2014 (a) |
|||
Bond |
$ | | ||
California Intermediate Tax Free Bond |
235,685 | |||
National Intermediate Tax Free Bond |
212,031 | |||
Short Term Bond |
5,849 | |||
Wisconsin Tax Exempt |
126,293 |
(a) | For the period from September 16, 2013 through July 31, 2014. |
Amount designated as is zero or has been rounded to zero.
During the period from September 16, 2013 through July 31, 2014, no amounts were reimbursed to NFA pursuant to the Expense Limitation Agreement.
Prior to September 16, 2013, HighMark contractually agreed to reduce its fees (excluding portfolio brokerage and transaction costs, taxes relating to transacting in foreign securities, if any, extraordinary expenses and any expenses indirectly incurred by a Fund through investments in pooled investment vehicles), and to the extent necessary to reimburse the Funds in order to limit the Funds from exceeding certain expense limitations. For the period from August 1, 2013 through September 15, 2013, expenses reimbursed under the terms of that agreement were as follows:
Fund | Amount | |||
Bond |
$ | 55,593 | ||
California Intermediate Tax Free Bond |
84,194 | |||
National Intermediate Tax Free Bond |
43,916 | |||
Short Term Bond |
38,214 | |||
Wisconsin Tax Exempt |
44,209 |
Prior to September 16, 2013 the Funds were subject to a recoupment plan under HighMark (Predecessor Plan). Under the Predecessor Plan HighMark was able to recoup from the Fund any of the fees and expenses it waived until the end of the third fiscal year after the end of the fiscal year in which such waiver and/or reimbursement occurred, subject to certain limitations. For the period from August 1, 2013 through September 15, 2013, no amounts were reimbursed to HighMark. Effective September 16, 2013, the Predecessor Plan was terminated.
94
Notes to Financial Statements (Continued)
July 31, 2014
Effective September 16, 2013, NFM, a wholly owned subsidiary of NFS Distributors, Inc. (NFSDI) (a wholly owned subsidiary of NFS), provides various administrative and accounting services for the Funds and serves as Transfer and Dividend Disbursing Agent for the Funds. NFM has entered into an agreement with a third-party service provider to provide certain sub-administration and sub-transfer agency services to the Funds. NFM pays the service provider a fee for these services.
Effective September 16, 2013, under the terms of a Joint Fund Administration and Transfer Agency Agreement, the fees for such services are based on the sum of the following: (i) the amount payable by NFM to its sub-administrator and sub-transfer agent; and (ii) a percentage of the combined average daily net assets of the Trust and Nationwide Variable Insurance Trust, a Delaware statutory trust and registered investment company that is affiliated with the Trust, according to the fee schedule below.
Combined Fee Schedule | ||||
Up to $25 billion |
0.025% | |||
$25 billion and more |
0.020% |
During the period from September 16, 2013 through July 31, 2014, NFM earned $611,875 in fees from the Funds under the Joint Fund Administration and Transfer Agency Agreement.
Prior to September 16, 2013, the Funds were a series of an investment trust that was a party to an Administration Agreement with HighMark (the Administrator) under which the Administrator provided administrative services to such investment trust for an annual fee of 0.15% of the first $8 billion of the average daily net assets of the Funds and 0.14% of such average daily net assets in excess of $8 billion allocated to each Fund based on its respective net assets. For the period from August 1, 2013 through September 15, 2013, the Administrator received fees from the Funds in the amounts listed below.
Fund | Amount | |||
Bond |
$ | 75,609 | ||
California Intermediate Tax Free Bond |
47,527 | |||
National Intermediate Tax Free Bond |
18,658 | |||
Short Term Bond |
37,765 | |||
Wisconsin Tax Exempt |
36,469 |
Effective September 16, 2013, the Trust pays out-of-pocket expenses reasonably incurred by NFM in providing services to the Funds and the Trust, including, but not limited to, the cost of pricing services that NFM utilizes and networking fees paid to broker-dealers that provide sub-accounting and sub-transfer agency services to their customers who are Fund shareholders. Such services, which are not otherwise provided by NFM, generally include individual account maintenance and recordkeeping, dividend disbursement, responding to shareholder calls and inquiries, providing statements and transaction confirmations, tax reporting, and other shareholder services. Depending on the nature and quality of the services provided, fees for these services may range from $6 to $21 per customer per year.
Effective September 16, 2013, under the terms of the Joint Fund Administration and Transfer Agency Agreement and a letter agreement between NFM and the Trust, the Trust has agreed to reimburse NFM for certain costs related to the Funds portion of ongoing administration, monitoring and annual (compliance audit) testing of the Trusts Rule 38a-1 Compliance Program subject to the pre-approval of the Trusts Audit Committee. These costs are allocated among the series of the Trust based upon their relative net assets. For the period from September 16, 2013 through July 31, 2014, the Funds aggregate portion of such costs amounted to $931. For the period from August 1, 2013, through September 15, 2013, the Funds paid $8,085 to HighMark.
Effective September 16, 2013, under the terms of a Distribution Plan pursuant to Rule 12b-1 under the 1940 Act, Nationwide Fund Distributors LLC (NFD), the Funds principal underwriter, is compensated by the Funds for expenses
95
Notes to Financial Statements (Continued)
July 31, 2014
associated with the distribution of certain classes of shares of the Funds. NFD is a wholly owned subsidiary of NFSDI. These fees are based on average daily net assets of the respective class of the Funds at an annual rate as follows:
| 0.25% of the average daily net assets of Class A shares of each Fund (distribution or service fee) |
| 0.75% of the average daily net assets of Class C shares of each Fund (0.75% of which may be a distribution fee and 0.25% service fee) |
Prior to September 16, 2013, HighMark Funds Distributors, LLC (the Distributor), a wholly owned subsidiary of Foreside Funds Distributors LLC, and the Funds were parties to an underwriting agreement. HighMark adopted 12b-1 Plans (the Plans) with respect to Class A, Class B, and Class C Shares that allowed each Fund to pay distribution and service fees to the Distributor as compensation for its services under the Plans. The Distributor received a distribution fee computed daily and paid monthly, at the annual rate of 0.25% of the daily net assets attributable to each Funds Class A Shares, 0.75% of the daily net assets attributable to each Funds Class B Shares and 0.75% of the daily net assets attributable to each Funds Class C Shares, which was used by the Distributor to provide compensation for sales support and distribution activities.
For the period from August 1, 2013 through September 15, 2013, the Funds paid distribution fees to the Distributor in the amounts listed below.
Fund | Amount | |||
Bond |
$ | 21,669 | ||
California Intermediate Tax Free Bond |
57,943 | |||
National Intermediate Tax Free Bond |
11,906 | |||
Short Term Bond |
38,979 | |||
Wisconsin Tax Exempt |
56,329 |
Effective September 16, 2013, pursuant to an Underwriting Agreement, NFD serves as principal underwriter of the Funds in the continuous distribution of their shares and receives commissions in the form of a front-end sales charge on Class A shares. These fees are deducted from, and are not included in, proceeds from sales of Class A shares of the Funds. From these fees, NFD pays sales commissions, salaries and other expenses in connection with generating new sales of Class A shares of the Funds. Effective September 16, 2013, the Funds Class A sales charges ranged from 0.00% to 2.25% based on the amount of the purchase. For the period from September 16, 2013 through July 31, 2014, the Funds imposed front-end sales charges of $65,485. For the period from August 1, 2013 through September 15, 2013, the Predecessor Funds imposed front-end sales charges of $13,808.
Effective September 16, 2013, NFD also receives fees in the form of contingent deferred sales charges (CDSCs) on Class A and Class C shares. Any CDSC is based on the original purchase price or the current market value of the shares being redeemed, whichever is less. A CDSC is imposed on Class A shares for certain redemptions, and Class C shares made within 1 year of purchase. Effective September 16, 2013, applicable Class A CDSCs were 0.50% for the Funds. Class C CDSCs were 1.00% for the Funds. For the period from September 16, 2013 through July 31, 2014, the Funds imposed CDSCs of $11,169. For the period from August 1, 2013 through September 15, 2013, the Predecessor Funds imposed CDSCs of $2,077.
A Fund may retain all or a portion of the sales charges.
Effective September 16, 2013, under the terms of an Administrative Services Plan, the Funds pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions that agree to provide administrative support services to the shareholders of certain classes. These services may include, but are not limited to, the following: (i) establishing and maintaining shareholder accounts; (ii) processing purchase and redemption transactions; (iii) arranging bank wires; (iv) performing shareholder sub-accounting; (v) answering inquiries regarding the Funds; and (vi) other such services. These fees are calculated at an annual rate of up to 0.25% of the average daily net assets of Class A and Institutional Service Class shares of each Fund. Effective March 1, 2014, Class C shares began charging administrative servicing fees. These fees are calculated at an annual rate of up to 0.25% of the average daily net assets of Class C shares of the Funds.
96
Notes to Financial Statements (Continued)
July 31, 2014
Prior to September 16, 2013, HighMark had similar administrative servicing plans permitting payment of compensation to service providers, which may have included HighMark or its affiliates that had agreed to provide certain shareholder support services for its customers who owned Fiduciary and Class A or Class B Shares. In consideration for such services, a service provider was entitled to receive compensation at the annual rate of up to 0.25% of the average daily net assets of the applicable class or classes of shares of the Funds. The service providers had agreed to waive a portion of their fees for certain classes of all Funds for the period from August 1, 2013 through September 15, 2013. The administrative servicing fee waivers by HighMark, or its affiliates, were voluntary and not subject to recoupment.
For the year ended July 31, 2014, the effective rates for administrative services fees, net of waivers, were as follows:
Fund | Class A | Class B (a) | Class C | Institutional Service Class (b) |
||||||||||||
Bond |
0.06 | % | 0.25 | % | 0.02 | % | 0.10 | % | ||||||||
California Intermediate Tax Free Bond |
0.05 | N/A | 0.02 | 0.03 | ||||||||||||
National Intermediate Tax Free Bond |
0.05 | N/A | 0.01 | 0.04 | ||||||||||||
Short Term Bond |
0.05 | N/A | 0.02 | 0.03 | ||||||||||||
Wisconsin Tax Exempt |
0.05 | 0.25 | 0.02 | 0.06 |
(a) | For the period August 1, 2013 through September 15, 2013. |
(b) | Effective September 16, 2013, Fiduciary Shares were renamed Institutional Service Class Shares. |
N/A Not Applicable.
During the period from September 16, 2013 through July 31, 2014, the effective rates for administrative services fees that NFS earned were as follows:
Fund | Class A | Class C | Institutional Service Class |
|||||||||
Bond |
0.06 | % | 0.03 | % | 0.10 | % | ||||||
California Intermediate Tax Free Bond |
0.05 | 0.02 | 0.03 | |||||||||
National Intermediate Tax Free Bond |
0.05 | 0.01 | 0.03 | |||||||||
Short Term Bond |
0.06 | 0.02 | 0.03 | |||||||||
Wisconsin Tax Exempt |
0.04 | 0.02 | 0.06 |
For the period from September 16, 2013 through July 31, 2014, NFS earned the following amounts in administrative services fees from each Fund:
Fund | Amount | |||
Bond |
$ | 280,414 | ||
California Intermediate Tax Free Bond |
55,575 | |||
National Intermediate Tax Free Bond |
24,569 | |||
Short Term Bond |
45,472 | |||
Wisconsin Tax Exempt |
47,510 |
For the period from August 1, 2013 through September 15, 2013, HighMark, or its affiliates earned the following amounts in administrative servicing fees, net of waivers, from each Fund:
Fund | Amount | |||
Bond |
$ | 29,483 | ||
California Intermediate Tax Free Bond |
11,780 | |||
National Intermediate Tax Free Bond |
4,962 | |||
Short Term Bond |
8,626 | |||
Wisconsin Tax Exempt |
8,218 |
97
Notes to Financial Statements (Continued)
July 31, 2014
As of July 31, 2014, NFA or its affiliates directly held the percentage indicated below of the shares outstanding of the applicable Fund.
Fund | % of Shares Outstanding Owned |
|||
Bond |
| |||
California Intermediate Tax Free Bond |
0.01 | % | ||
National Intermediate Tax Free Bond |
0.01 | |||
Short Term Bond |
63.89 | |||
Wisconsin Tax Exempt |
0.01 |
Amount designated as is zero or has been rounded to zero.
4. Line of Credit and Earnings Credit
Effective July 17, 2014, the Funds have been added to the Trust and Nationwide Variable Insurance Trust (together, the Trusts) renewed credit agreement with JPMorgan, The Bank of New York Mellon, and Wells Fargo Bank National Association, permitting the Trusts, in the aggregate, to borrow up to $100,000,000. Advances taken by a Fund under this arrangement would be primarily for temporary or emergency purposes, including the meeting of redemption requests that otherwise might require the untimely disposition of securities, and are subject to the Funds borrowing restrictions. The line of credit requires a commitment fee of 0.07% per year on $100,000,000. Borrowings under this arrangement bear interest at a rate of 1.00% per annum plus the higher of (a) the one month London Interbank Offered Rate or (b) the Federal Funds Rate. Interest costs, if any, would be shown on the Statement of Operations. No compensating balances are required under the terms of the line of credit. In addition, a Fund may not draw on any portion of the line of credit that is provided by a bank that is an affiliate of the Funds subadviser, if applicable. The line of credit is renewed annually, and next expires on July 16, 2015. There were no borrowings under the line of credit during the year ended July 31, 2014.
JPMorgan provides earnings credits for cash balances maintained in the Funds custody accounts, which are used to offset custody fees of a Fund.
5. Investment Transactions
For the year ended July 31, 2014, purchases of and sales of securities (excluding short-term securities) were as follows:
Fund | Purchases | Sales | ||||||
Bond |
$ | 289,494,250 | $ | 192,428,638 | ||||
California Intermediate Tax Free Bond |
7,367,750 | 53,734,913 | ||||||
National Intermediate Tax Free Bond |
7,958,868 | 23,588,226 | ||||||
Short Term Bond |
313,566,183 | 110,128,578 | ||||||
Wisconsin Tax Exempt |
11,044,569 | 35,882,044 |
For the year ended July 31, 2014, purchases and sales of U.S. Government securities were as follows:
Fund | Purchases | Sales | ||||||
Bond |
$ | 77,805,311 | $ | 28,329,863 | ||||
Short Term Bond |
56,814,141 | 30,387,588 |
98
Notes to Financial Statements (Continued)
July 31, 2014
6. Portfolio Investment Risks
Risks Associated with Interest Rates
Prices of fixed-income securities generally increase when interest rates decline and decrease when interest rates increase. Prices of longer-term securities generally change more in response to interest rate changes than prices of shorter term securities. To the extent the Fund invests a substantial portion of its assets in fixed-income securities with longer-term maturities, rising interest rates are more likely to cause the value of the Funds investments to decline significantly.
Risks Associated with Low Quality/High Yield Securities
Lower quality securities, while generally offering higher yields than investment grade securities with similar maturities, involve greater risks, including the possibility of default or bankruptcy. There is more risk associated with these investments because of reduced creditworthiness and increased risk of default. Lower-quality securities are considered to have extremely poor prospects of ever attaining any real investment standing, to have a current identifiable vulnerability to default or to be in default, to be unlikely to have the capacity to make required interest payments and repay principal when due in the event of adverse business, financial or economic conditions, or to be in default or not current in the payment of interest or principal. They are regarded as predominantly speculative with respect to the issuers capacity to pay interest and repay principal.
Concentration of Credit Risk
As of the date of these financial statements, the California Intermediate Tax-Free Bond Fund invests in debt securities issued by the State of California and its political subdivisions. As of the date of these financial statements, the Wisconsin Tax- Exempt Fund invests in debt securities issued by the State of Wisconsin and its political subdivisions. The ability of the issuers of the securities held by these Funds to meet their obligations may be affected by economic and political developments in their respective states.
Other
The Trust invests through an omnibus account at the Funds custodian, JPMorgan, any un-invested cash on a daily basis into one of the following money market funds: Dreyfus Tax Exempt Cash Management, Institutional Shares, Goldman Sachs Tax Exempt California Fund, Institutional Shares or Invesco Tax Free Cash Reserve Portfolio, Institutional Shares. As with investments in any money market fund, the Trusts investments in the aforementioned money market funds are neither guaranteed nor insured, and shares of these money market funds may decline in value, causing losses to the Trust.
7. Indemnifications
Under the Trusts organizational documents, the Trusts Officers and Trustees are indemnified by the Trust against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into indemnification agreements with its Trustees and certain of its Officers. Trust Officers receive no compensation from the Trust for serving as its Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trusts maximum liability under these arrangements is unknown, as this would involve future claims made against the Trust. Based on experience, however, the Trust expects the risk of loss to be remote.
99
Notes to Financial Statements (Continued)
July 31, 2014
8. Other
As of July 31, 2014, the Funds had individual shareholder accounts and/or omnibus shareholder accounts (comprising a group of individual shareholders), which held more than 10% of the total shares outstanding of the Funds as detailed below.
Fund | % of Shares | Number of Accounts | ||||||
Bond |
75.05 | % | 5 | |||||
California Intermediate Tax Free Bond |
64.91 | 4 | ||||||
National Intermediate Tax Free Bond |
64.50 | 3 | ||||||
Short Term Bond |
63.89 | 4 | (a) | |||||
Wisconsin Tax Exempt |
33.74 | 1 |
(a) | Each such account is the account of an affiliated fund. |
9. New Accounting Pronouncements
In June 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-11: Repurchase-to-Maturity Transactions, Repurchase Financing, and Disclosures (ASU 2014-11). The FASB issued ASU 2014-11 to improve the financial reporting of repurchase agreements and other similar transactions. ASU 2014-11 changes the accounting for repurchase-to-maturity transactions and repurchase financing arrangements and requires enhanced disclosures about repurchase agreements and other similar transactions. ASU 2014-11 will take effect for funds with fiscal years beginning after December 15, 2014. Management is currently evaluating the impact ASU 2014-11 will have on the Funds financial statement disclosures.
10. Reorganization
Each Fund commenced operation on September 16, 2013 as a result of a tax free reorganization in which Bond, California Intermediate Tax Free Bond, National Intermediate Tax Free Bond, Short Term Bond, and Wisconsin Tax Exempt acquired all of the assets, subject to all liabilities and obligations of the HighMark Bond Fund, HighMark California Intermediate Tax-Free Bond Fund, HighMark National Intermediate Tax-Free Bond Fund, HighMark Short Term Bond Fund, and HighMark Wisconsin Tax-Exempt Fund, respectively, each a former series of HighMark Funds (each a Predecessor Fund, and collectively the Predecessor Funds). Class A, Class B, Class C and Fiduciary shareholders of each Predecessor Fund received Class A, Class B, Class C and Institutional Service Class shares, respectively, of the corresponding Funds with an aggregate share net asset value equal to the aggregate share net asset value of their shares in the respective Predecessor Funds immediately prior to the reorganization. Each Funds reorganization was treated as a tax-free reorganization for federal income tax purposes and, accordingly, the basis of the assets of each Fund reflects the historical basis of the assets of the corresponding Predecessor Fund as of the date of the reorganization. For financial reporting purposes, each Predecessor Funds operating history prior to the reorganization is reflected in the corresponding Nationwide Funds financial statements and financial highlights.
The reorganization was accomplished by the following tax-free exchange in which each shareholder of the Predecessor Fund received the same aggregate share net asset value in the corresponding Fund as noted below:
Fund/Class | Shares | Value | ||||||
Bond |
|
|||||||
Class A |
2,306,938 | $ | 24,906,629 | |||||
Class B** |
7,234 | 77,781 | ||||||
Class C |
1,240,147 | 13,312,114 | ||||||
Institutional Service Class* |
26,544,533 | 291,849,172 |
100
Notes to Financial Statements (Continued)
July 31, 2014
Fund/Class | Shares | Value | ||||||
California Intermediate Tax Free Bond |
|
|||||||
Class A |
6,970,811 | $ | 70,555,059 | |||||
Class C |
3,490,146 | 35,188,004 | ||||||
Institutional Service Class* |
10,733,860 | 109,199,848 | ||||||
National Intermediate Tax Free Bond |
|
|||||||
Class A |
1,509,371 | 16,969,709 | ||||||
Class C |
603,212 | 6,789,697 | ||||||
Institutional Service Class* |
5,420,075 | 60,983,970 | ||||||
Short Term Bond |
|
|||||||
Class A |
4,322,803 | 43,089,271 | ||||||
Class C |
2,602,075 | 26,249,990 | ||||||
Institutional Service Class* |
8,932,889 | 89,162,736 | ||||||
Wisconsin Tax Exempt |
|
|||||||
Class A |
12,406,596 | 123,860,012 | ||||||
Class B** |
33,303 | 332,069 | ||||||
Class C |
1,576,731 | 15,717,642 | ||||||
Institutional Service Class* |
63,797 | 636,889 |
* | Effective September 16, 2013, Fiduciary shares were renamed Institutional Service Class Shares. |
** | Effective September 16, 2013, Class B Shares were converted into Class A Shares. See Statements of Changes in Net Assets for additional information. |
11. Federal Tax Information
The tax character of distributions paid during the year ended July 31, 2014 was as follows:
Distributions paid from | ||||||||||||||||||||||||
Fund | Ordinary Income* |
Net Long-Term Capital Gains |
Total Taxable Distributions |
Total Tax- exempt Distributions |
Return of Capital |
Total Distributions Paid |
||||||||||||||||||
Bond |
$ | 10,622,007 | $ | 6,980,205 | $ | 17,602,212 | $ | | $ | | $ | 17,602,212 | ||||||||||||
California Intermediate Tax Free Bond |
565 | 400,296 | 400,861 | 4,799,650 | | 5,200,511 | ||||||||||||||||||
National Intermediate Tax Free Bond |
10,759 | 788,297 | 799,056 | 1,890,545 | | 2,689,601 | ||||||||||||||||||
Short Term Bond |
2,382,058 | | 2,382,058 | | | 2,382,058 | ||||||||||||||||||
Wisconsin Tax Exempt |
| | | 3,931,301 | | 3,931,301 |
Amounts designated as are zero or have been rounded to zero.
* | Ordinary Income amounts include taxable market discount and net short-term capital gains, if any. |
101
Notes to Financial Statements (Continued)
July 31, 2014
The tax character of distributions paid during the year ended July 31, 2013 was as follows:
Distributions paid from | ||||||||||||||||||||||||
Fund | Ordinary Income* |
Net Long-Term Capital Gains |
Total Taxable Distributions |
Total Tax- exempt Distributions |
Return of Capital |
Total Distributions Paid |
||||||||||||||||||
Bond |
$ | 13,540,134 | $ | 2,125,724 | $ | 15,665,858 | $ | | $ | | $ | 15,665,858 | ||||||||||||
California Intermediate Tax Free Bond |
529 | | 529 | 6,002,281 | | 6,002,810 | ||||||||||||||||||
National Intermediate Tax Free Bond |
| 363,888 | 363,888 | 2,495,995 | | 2,859,883 | ||||||||||||||||||
Short Term Bond |
2,423,681 | | 2,423,681 | | | 2,423,681 | ||||||||||||||||||
Wisconsin Tax Exempt |
6,126 | | 6,126 | 4,566,852 | | 4,572,978 |
Amounts designated as are zero or have been rounded to zero.
* | Ordinary Income amounts include taxable market discount and net short-term capital gains, if any. |
As of July 31, 2014, the components of accumulated earnings/(deficit) on a tax basis were as follows:
Fund | Undistributed Ordinary Income |
Undistributed Tax-exempt Income |
Undistributed Long-Term Capital Gains |
Accumulated Earnings |
Distributions Payable* |
Accumulated Capital and Other Losses |
Unrealized Appreciation/ (Depreciation)** |
Total Accumulated Earnings (Deficit) |
||||||||||||||||||||||||
Bond |
$ | 840,362 | $ | | $ | 3,371,925 | $ | 4,212,287 | $ | (802,324 | ) | $ | | $ | 7,382,235 | $ | 10,792,198 | |||||||||||||||
California Intermediate Tax Free Bond |
| 383,304 | 1,309,085 | 1,692,389 | (373,410 | ) | | 11,642,651 | 12,961,630 | |||||||||||||||||||||||
National Intermediate Tax Free Bond |
1,454 | 143,176 | 1,008,458 | 1,153,088 | (141,628 | ) | | 3,959,282 | 4,970,742 | |||||||||||||||||||||||
Short Term Bond |
215,272 | | | 215,272 | (278,811 | ) | (333,740 | ) | 1,972 | (395,307 | ) | |||||||||||||||||||||
Wisconsin Tax Exempt |
| 315,220 | | 315,220 | (301,005 | ) | (5,018,551 | ) | 2,450,718 | (2,553,618 | ) |
Amounts designated as are zero or have rounded to zero.
* | Differences between financial statement distributions payable and tax-basis distributions payable are a result of accrual-based accounting and cash-basis accounting used for federal tax reporting purposes. |
** | The difference between book-basis and tax-basis unrealized appreciation/(depreciation) is primarily attributable to timing differences in recognizing certain gains and losses on investment transactions. |
As of July 31, 2014, the tax cost of securities and the breakdown of unrealized appreciation/(depreciation) was as follows:
Fund | Tax Cost of Securities | Unrealized Appreciation |
Unrealized Depreciation |
Net Unrealized Appreciation/ (Depreciation) |
||||||||||||
Bond |
$ | 437,888,689 | $ | 12,170,584 | $ | (4,788,349 | ) | $ | 7,382,235 | |||||||
California Intermediate Tax Free Bond |
174,677,412 | 11,728,539 | (85,888 | ) | 11,642,651 | |||||||||||
National Intermediate Tax Free Bond |
66,004,047 | 4,041,500 | (82,218 | ) | 3,959,282 | |||||||||||
Short Term Bond |
389,189,743 | 1,392,368 | (1,390,396 | ) | 1,972 | |||||||||||
Wisconsin Tax Exempt |
120,052,098 | 5,157,402 | (2,706,684 | ) | 2,450,718 |
As of July 31, 2014, for federal income tax purposes, the Funds have capital loss carryforwards available to offset capital gains, if any, to the extent provided by the U.S. Treasury regulations and in any given year may be limited due to large shareholder redemptions or contributions. Any unlimited losses will be required to be utilized prior to the losses which have an expiration date.
102
Notes to Financial Statements (Continued)
July 31, 2014
The following table represents capital loss carryforwards with the year the amounts will expire if not utilized to offset future capital gains.
Fund | Amount | Expires | ||||||
Short Term Bond |
$ | 214,854 | 2018 | |||||
Short Term Bond |
67,812 | Unlimited | ||||||
Wisconsin Tax Exempt |
638,017 | Unlimited |
During the year ended July 31, 2014, the Funds had capital loss carryforwards that were utilized or expired, and are no longer eligible to offset future capital gains, if any, in the amounts listed below.
Fund | Utilized | Expired | ||||||
California Intermediate Tax Free Bond |
$ | 86,092 | $ | |
Amount designated as is zero or has rounded to zero.
The Funds have elected to defer late-year losses in accordance with the Federal tax rules. These losses are treated as having arisen on the first day of the following fiscal year. For the year ended July 31, 2014, the Funds have elected to defer late year losses in the amounts listed below.
Fund | Post-October Capital Loss |
Late Year Ordinary Loss |
||||||
Short Term Bond |
$ | 51,074 | | |||||
Wisconsin Tax Exempt |
4,380,534 | |
Amounts designated as are zero or have rounded to zero.
12. Subsequent Events
Management has evaluated the impact of subsequent events on the Funds and has determined that there are no subsequent events requiring recognition or disclosure in the financial statements.
103
Report of Independent Registered Public Accounting Firm
To the Board of Trustees and Shareholders of Nationwide Mutual Funds:
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 Nationwide HighMark Bond Fund, Nationwide HighMark California Intermediate Tax Free Bond Fund, Nationwide HighMark National Intermediate Tax Free Bond Fund, Nationwide HighMark Short Term Bond Fund, and Nationwide Ziegler Wisconsin Tax Exempt Fund (five of the series of Nationwide Mutual Funds, formerly HighMark Bond Fund, HighMark California Intermediate Tax-Free Bond Fund, HighMark National Intermediate Tax-Free Bond Fund, HighMark Short Term Bond Fund, and HighMark Wisconsin Tax-Exempt Fund, hereafter referred to as the Funds) at July 31, 2014, the results of each of their operations, the changes in each of their net assets and the financial highlights for the year then ended, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as financial statements) are the responsibility of the Funds management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with 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 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 July 31, 2014 by correspondence with the custodian, brokers and underlying funds transfer agent, provide a reasonable basis for our opinion. The statements of changes in net assets presented for the year ended July 31, 2013 and the financial highlights presented for the year ended July 31, 2013 or prior were audited by another independent registered public accounting firm whose report dated September 25, 2013 expressed an unqualified opinion on those statements and financial highlights.
/s/ PricewaterhouseCoopers LLP
Philadelphia, Pennsylvania
September 24, 2014
104
July 31, 2014 (Unaudited)
Other Federal Tax Information
The Funds designate the following amounts, or the maximum amount allowable under the Internal Revenue Code, as long term capital gain distributions qualifying for the maximum 20% income tax rate for individuals:
Fund | Amount | |||
Bond |
$ | 6,980,205 | ||
California Intermediate Tax Free Bond |
400,296 | |||
National Intermediate Tax Free Bond |
788,297 |
For the year ended July 31, 2014, the Funds percentage of earned income which was tax exempt was as follows:
Fund | % of Tax Exempt Income |
|||
California Intermediate Tax Free Bond |
99 | % | ||
National Intermediate Tax Free Bond |
100 | |||
Wisconsin Tax Exempt |
100 |
105
July 31, 2014
Trustees and Officers of the Trust
The address for each Trustee is: c/o Nationwide Funds Group, 1000 Continental Drive, Suite 400, King of Prussia, PA 19406.
Name and Year of Birth |
Position(s) Held with the Trust and Length of Time Served1,2 |
Principal Occupation(s) During Past Five Years (or longer)3 |
Number of Portfolios in the Nationwide Fund Complex Overseen by Trustee |
Other Directorships Held by Trustee During Past Five Years4 | ||||||
Charles E. Allen 1948 |
Trustee since July 2000 |
Mr. Allen was Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management) from its founding in 1987 to 2012. | 119 | None | ||||||
Paula H.J. Cholmondeley 1947 |
Trustee since July 2000 |
Ms. Cholmondeley focuses full time on corporate governance. She sits on public company boards and is also on the faculty of the National Association of Corporate Directors. She has served as a Chief Executive Officer of Sorrel Group (management consulting company) since January 2004. From April 2000 through December 2003, Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America. | 119 | Director of Dentsply International, Inc. (dental products) from 2002 to present, Ultralife Batteries, Inc. from 2004 to 2010, Albany International Corp. (paper industry) from 2005 to 2013, Terex Corporation (construction equipment) from 2004 to present, and Minerals Technology, Inc. (specialty chemicals) from 2005 to present. | ||||||
Phyllis Kay Dryden 1947 |
Trustee since December 2004 |
Ms. Dryden became CEO and President of Energy Dispute Solutions, LLC in January 2013, leading a company providing strategy consulting, arbitration and mediation services. She has been a management consultant since 1996, first as a partner of Mitchell Madison Group, then as a managing partner and head of west coast business development for marchFIRST, returning to Mitchell Madison Group in 2003 as an associated partner until January 2010 and thereafter as an independent strategy consultant through December 2012. Ms. Dryden was VP and General Counsel of Lucasfilm, Ltd. from 1981 to 1984, SVP and General Counsel of Charles Schwab and Co., Inc. from 1984 to 1992, and EVP and General Counsel of Del Monte Foods from 1992 to 1995. | 119 | None |
106
Management Information (Continued)
July 31, 2014
The address for each Trustee is: c/o Nationwide Funds Group, 1000 Continental Drive, Suite 400, King of Prussia, PA 19406.
Name and Year of Birth |
Position(s) Held with the Trust and Length of Time Served1,2 |
Principal Occupation(s) During Past Five Years (or longer)3 |
Number of Portfolios in the Nationwide Fund Complex Overseen by Trustee |
Other Directorships Held by Trustee During Past Five Years4 | ||||||
Barbara L. Hennigar 1935 |
Trustee since July 2000 |
Ms. Hennigar was Executive Vice President of Oppenheimer Funds (an asset management company) from October 1992 until June 2000; Chairman of Oppenheimer Funds Services from October 1999 until June 2000; and President and CEO of Oppenheimer Funds Services from June 1992 until October 1999. She was previously Board Chair of a non-profit independent school, and is currently an independent trustee and endowment chair of St. Marys Academy, an independent school in Denver, CO. | 119 | None | ||||||
Barbara I. Jacobs 1950 |
Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1988 through 2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 119 | None | ||||||
Keith F. Karlawish 1964 |
Trustee since March 2012 |
Mr. Karlawish has been a partner of Park Ridge Asset Management, LLC since December 2008, at which he also serves as a portfolio manager. From May 2002 until October 2008, Mr. Karlawish was the President of BB&T Asset Management, Inc., and was President of the BB&T Mutual Funds and BB&T Variable Insurance Funds from February 2005 until October 2008. | 119 | Trustee of the BB&T Mutual Funds and BB&T Variable Insurance Funds from June 2006 until December 2008. | ||||||
Carol A. Kosel 1963 |
Trustee since March 2013 |
Ms. Kosel was a consultant to the Evergreen Funds Board of Trustees from October 2005 to December 2007. She was Senior Vice President, Treasurer, and Head of Fund Administration of the Evergreen Funds from April 1997 to October 2005. | 119 | Trustee of Sun Capital Advisers Trust from April 2011 to December 2012 and Trustee of Evergreen Funds from January 2008 to July 2010. | ||||||
Douglas F. Kridler 1955 |
Trustee since September 1997 |
Mr. Kridler is the President and Chief Executive Officer of The Columbus Foundation, a $1.5 billion community foundation with 2,000 funds in 55 Ohio counties and 37 states in the U.S. | 119 | None |
107
Management Information (Continued)
July 31, 2014
The address for each Trustee is: c/o Nationwide Funds Group, 1000 Continental Drive, Suite 400, King of Prussia, PA 19406.
Name and Year of Birth |
Position(s) Held with the Trust and Length of Time Served1,2 |
Principal Occupation(s) During Past Five Years (or longer)3 |
Number of Portfolios in the Nationwide Fund Complex Overseen by Trustee |
Other Directorships Held by Trustee During Past Five Years4 | ||||||
Lydia Micheaux Marshall5 1949 |
Trustee since June 2014 |
Ms. Marshall has been President of LM Marshall, LLC (investment and business consulting company) since 2007. |
119 | Director of Nationwide Corporation since 2001, Nationwide Financial Services, Inc. since 1997, Nationwide Foundation since 2002, Nationwide Life Insurance Company since 2002, Nationwide Life and Annuity Insurance Company since 2002, Nationwide Mutual Fire Insurance Company since 2001, Nationwide Mutual Insurance Company since 2002, and Scottsdale Insurance Company since 2001 (all financial services and insurance companies). Chair and CEO of Versura, Inc. (data processing) since 1999. Director of Seagate Technology (hard disk drive and storage manufacturer) since 2004. Director of Public Welfare Foundation (non-profit foundation) since 2009. |
108
Management Information (Continued)
July 31, 2014
The address for each Trustee is: c/o Nationwide Funds Group, 1000 Continental Drive, Suite 400, King of Prussia, PA 19406.
Name and Year of Birth |
Position(s) Held with the Trust and Length of Time Served1,2 |
Principal Occupation(s) During Past Five Years (or longer)3 |
Number of Portfolios in the Nationwide Fund Complex Overseen by Trustee |
Other Directorships Held by Trustee During Past Five Years4 | ||||||
David C. Wetmore 1948 |
Trustee since 1995 and Chairman since February 2005 |
Mr. Wetmore was a Managing Director of Updata Capital, Inc. (a technology-oriented investment banking and venture capital firm) from 1995 through 2000. Prior to 1995, Mr. Wetmore served as the Chief Operating Officer, Chief Executive Officer and Chairman of the Board of several publicly-held software and services companies, and as the managing partner of a big 8 public accounting firm. | 119 | None |
1 | Length of time served includes time served with predecessor of the Trust. |
2 | Each Trustee holds office for the lifetime of the Trust or until such Trustees earlier death, resignation, removal, retirement or inability otherwise to serve, or the election and qualification of his or her successor. |
3 | Unless otherwise noted, the information presented is the principal occupation of the Trustee during the past five years. |
4 | Directorships held in (i) any other investment companies registered under the 1940 Act, (ii) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the Exchange Act) or (iii) any company subject to the requirements of Section 15(d) of the Exchange Act. |
5 | Ms. Marshall is considered an interested person of the Trust because she is a Director of the parent company of, and several affiliates of, the Trusts investment adviser and distributor. |
109
Management Information (Continued)
July 31, 2014
The address for each Officer is: c/o Nationwide Funds Group, 1000 Continental Drive, Suite 400, King of Prussia, PA 19406.
Name and Year of Birth |
Position(s) Held with Fund and Length of Time Served1 |
Principal Occupation(s) During Past Five Years2 | ||
Michael S. Spangler 1966 |
President and Chief Executive Officer since June 2008 | Mr. Spangler is President and Chief Executive Officer of Nationwide Funds Group, which includes NFA3, Nationwide Fund Management LLC3 and Nationwide Fund Distributors LLC3, and is a Senior Vice President of NFS3. From May 2004 through May 2008, Mr. Spangler was Managing Director, Head of Americas Retail and Intermediary Product Management for Morgan Stanley Investment Management. | ||
Stephen T. Grugeon 1950 |
Executive Vice President and Chief Operating Officer since June 2008 |
Mr. Grugeon has been Executive Vice President and Chief Operating Officer of Nationwide Funds Group since May 20073. From February 2008 through June 2008, Mr. Grugeon also served as the acting President and Chief Executive Officer of the Trust and of Nationwide Funds Group. From December 2006 until January 2008, Mr. Grugeon was Executive Vice President of NWD Investments3. | ||
Joseph Finelli 1957 |
Treasurer since September 2007 | Mr. Finelli is the Principal Financial Officer and Senior Vice President for Nationwide Funds Group3. From July 2001 until September 2007, Mr. Finelli was Assistant Treasurer and Vice President of Investment Accounting and Operations of NWD Investments3. | ||
Brian Hirsch 1956 |
Chief Compliance Officer since January 2012 | Mr. Hirsch is Vice President of NFA and Chief Compliance Officer of NFA and the Trust. From January 2003 through January 2012, Mr. Hirsch was the Senior Vice President for Compliance and Fund Administration at IFS Financial Services, Inc., a subsidiary of the Western Southern Financial Group. | ||
Eric E. Miller 1953 |
Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group and NWD Investments3. | ||
Jennifer Tiffany Grinstead 1976 |
Chief Marketing Officer since March 2014 | Ms. Grinstead is Vice President of Nationwide Funds Marketing for NFS.3 From April 2012 through April 2014, Ms. Grinstead was Assistant Vice President, Life Marketing for NFS.3 From January 2009 through April 2012, Ms. Grinstead was Assistant Vice President, Retirement Plan Marketing for NFS.3 |
1 | Length of time served includes time served with the Trusts predecessors. |
2 | Unless otherwise noted, the information presented is the principal occupation of the Officer during the past five years. |
3 | These positions are held with an affiliated person or principal underwriter of the Funds. |
Additional information regarding the Trustees and Officers may be found in the Trusts Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920.
Federal law requires the Trust and each of its investment advisers and subadvisers to adopt procedures for voting proxies (Proxy Voting Guidelines) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Fund. The Funds proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Trusts website at nationwide.com/mutualfunds, and (iii) on the Securities and Exchange Commissions website at www.sec.gov.
110
Market Index Definitions |
Barclays 7-Year Municipal Bond Index: An unmanaged index that consists of a broad selection of investment-grade general obligation and revenue bonds with maturities of approximately seven years.
Barclays Municipal Bond Index: An unmanaged, market value-weighted index of investment-grade municipal bonds with a minimum credit rating of Baa and maturities of one year or more; serves as a broad market performance index for the tax-exempt bond market.
Barclays U.S. 1-3 Year Government/Credit Bond Index: An unmanaged index of U.S. dollar-denominated, investment-grade, fixed-rate, publicly issued, taxable bond market issues (including Treasury, government and corporate securities) with a remaining maturity of one to three years.
Barclays U.S. Aggregate Bond Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Consumer Price Index (CPI): Calculated by the U.S. Department of Labors Bureau of Labor Statistics, the CPI represents changes in prices of a basket of goods and services purchased for consumption by urban households.
Lipper Analytical Services, Inc. (Lipper) is an industry research firm whose rankings are based on total return performance and do not reflect the effect of sales charges. Each fund is ranked within a universe of funds similar in investment objective as determined by Lipper.
MSCI ACWI ex USA: An unmanaged, market capitalization-weighted index that is designed to measure the performance of the stocks in the global developed and emerging markets, excluding U.S.-based companies.
MSCI EAFE® Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of large-cap and mid-cap stocks in developed markets outside the United States and Canada.
NASDAQ-100 Index: An unmanaged index that includes 100 of the largest domestic and international nonfinancial securities listed on the Nasdaq Stock Market, based on market capitalization.
NYSE Arca Tech 100 Index®: An unmanaged, price-weighted index of at least 100 individual technology-related securities, consisting of stocks of companies from various industries that produce or deploy innovative technologies to conduct their business.
Russell 1000® Growth Index: An unmanaged index that measures the performance of the large-capitalization growth segment of the U.S. equity universe; includes those Russell 1000® Index companies with higher price-to-book ratios and higher forecasted growth values.
Russell 1000® Value Index: An unmanaged index that measures the performance of the large-capitalization value segment of the U.S. equity universe; includes those Russell 1000® Index companies with lower price-to-book ratios and lower forecasted growth values.
Russell 2000® Index: An unmanaged index that measures the performance of the small-capitalization segment of the U.S. equity universe.
Russell 2000® Growth Index: An unmanaged index that measures the performance of the small-capitalization growth segment of the U.S. equity universe; includes those Russell 2000® Index companies with higher price-to-book ratios and higher forecasted growth values.
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Market Index Definitions (cont.) |
Russell 2000® Value Index: An unmanaged index that measures the performance of the small-capitalization value segment of the U.S. equity universe; includes those Russell 2000® Index companies with lower price-to-book ratios and lower forecasted growth values.
Russell Midcap® Growth Index: An unmanaged index that measures the performance of the mid-capitalization growth segment of the U.S. equity universe; includes those Russell Midcap® Index companies with higher price-to-book ratios and higher forecasted growth values.
Note about Russell Indexes
Russell Investment Group is the source and owner of the trademarks, service marks and copyrights related to the Russell Indexes. Russell® is a trademark of Russell Investment Group.
S&P 500® Index: An unmanaged, market capitalization-weighted index of 500 stocks of leading large-cap U.S. companies in leading industries; gives a broad look at the U.S. equities market and those companies stock price performance.
S&P North American Technology Sector IndexTM: An unmanaged, modified, market capitalization-weighted index that measures the performance of the technology sector of the U.S. equity market.
S&P SmallCap 600® Value Index: An unmanaged index comprising small-capitalization value stocks included in the S&P SmallCap 600® Index. Performance is measured based on the ratios of book value, earnings, and sales to price.
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Glossary |
Definitions of some commonly used investment terms
Benchmark index: A broad-based securities index used as a comparison tool to measure the performance of a mutual fund.
Coefficient of correlation: A measure that determines the degree to which the movements of two variables are associated.
Derivative: A contract, security or investment with its value based on the performance of an underlying financial asset, index or economic measure.
Duration: A measure of how much the price of a bond would change compared to a change in market interest rates, based on the remaining time until a bonds maturity together with other factors. A bonds value drops when interest rates rise, and vice versa. Bonds with longer durations have higher risk and volatility.
Emerging market countries: Developing and low- or middle-income countries as identified by the International Finance Corporation or the World Bank. Emerging market countries may be found in regions such as Asia, Latin America, Eastern Europe, the Middle East and Africa.
Equity securities: Securities that represent an ownership interest in the issuer. Common stocks are the most common type of equity securities.
Expense ratio: The percentage of fees paid by a fund to its adviser for management and operational costs. A funds expense ratio includes all administrative expenses and 12b-1 fees but excludes sales charges.
Fixed-income securities: Securities, including bonds and other debt securities, that represent an obligation by the issuer to pay a specified rate of interest or dividend at specified times and eventually return the principal at maturity.
Futures: Contracts that obligate the buyer to buy and the seller to sell a specified quantity of an underlying asset (or settle for cash the value of a contract based on the underlying asset) at a specified price on the contracts maturity date.
Growth style: Investing in equity securities of companies that the Funds subadviser believes have above-average rates of earnings growth and which therefore may experience above-average increases in stock price.
High-yield bonds: Fixed-income securities that are rated below investment grade by nationally recognized statistical rating organizations. These bonds generally offer investors higher interest rates as a way to help compensate for the fact that the issuer is at greater risk of default.
Market capitalization: A common way of measuring the size of a company based on the price of its common stock multiplied by the number of outstanding shares.
Preferred stock: A class of stock that often pays dividends at a specified rate and has preference over common stocks in dividend payments and liquidation of assets.
Quantitative techniques: Mathematical and statistical methods used in the investment process to identify securities of issuers for possible purchase or sale by a mutual fund.
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Glossary (cont.) |
Value style: Investing in equity securities that a funds manager believes are undervalued, i.e., their stock prices are less than the manager believes they are intrinsically worth, based on such factors as a companys stock price relative to its book value, earnings and cash flow.
Yield curve: A plotted graph line showing the interest rates of bonds, at a set point in time, that have equal credit quality but different maturity dates.
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P.O. Box 701
Milwaukee, WI 53201-0701
nationwide.com/mutualfunds
Call 1-800-848-0920 to request a summary prospectus and/or a prospectus, or download prospectuses at nationwide.com/mutualfunds. These prospectuses outline investment objectives, risks, fees, charges and expenses, and other information that you should read and consider carefully before investing.
About Nationwide Funds Group (NFG)
NFG comprises Nationwide Fund Advisors, Nationwide Fund Distributors LLC and Nationwide Fund Management LLC. Together they provide advisory, distribution and administration services, respectively, to Nationwide Funds. Nationwide Fund Advisors (NFA) is the investment adviser to Nationwide Funds.
Distributor
Nationwide Funds distributed by Nationwide Fund Distributors LLC (NFD), member FINRA, King of Prussia, Pa. NFD is not affiliated with any subadviser contracted by NFA, with the exception of Nationwide Asset Management, LLC (NWAM).
Nationwide, Nationwide Financial, the Nationwide framemark, Nationwide Funds, Nationwide Funds Group and On Your Side are service marks of Nationwide Mutual Insurance Company.
© 2014 Nationwide Funds Group. All rights reserved.
AR-HM-CFX 9/14
Item 2. Code of Ethics.
Disclose whether, as of the end of the period covered by the report, the registrant has adopted a code of ethics that applies to the registrants principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party. If the registrant has not adopted such a code of ethics, explain why the registrant has not done so.
The registrant has adopted a code of ethics that applies to the registrants principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. This code of ethics is included as Exhibit 12 (a)(1).
The registrant must briefly describe the nature of any amendment, during the period covered by the report, to a provision of its code of ethics that applies to the registrants principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party, and that relates to any element of the code of ethics definition enumerated in paragraph (b) of this Item. The registrant must file a copy of any such amendment as an exhibit pursuant to Item 11(a)(1), unless the registrant has elected to satisfy paragraph (f) of this Item by posting its code of ethics on its website pursuant to paragraph (f)(2) of this Item, or by undertaking to provide its code of ethics to any person without charge, upon request, pursuant to paragraph (f)(3) of this Item.
If the registrant has, during the period covered by the report, granted a waiver, including an implicit waiver, from a provision of the code of ethics that applies to the registrants principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party, that relates to one or more items set forth in paragraph (b) of this Item, the registrant must briefly describe the nature of the waiver, the name of the person to whom the waiver was granted, and the date of the waiver.
During the period covered by the report, with respect to the registrants Code of Ethics that applies to the registrants principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, except as may be noted hereinbelow, there have been no amendments to, nor any waivers granted from, a provision that relates to any element of the Code of Ethics definition enumerated in paragraph (b) of this Item 2.
Item 3. Audit Committee Financial Expert.
(a) (1) Disclose that the registrants board of directors has determined that the registrant either:
(i) | Has at least one audit committee financial expert serving on its audit committee; or |
(ii) | Does not have an audit committee financial expert serving on its audit committee. |
(2) | If the registrant provides the disclosure required by paragraph (a)(1)(i) of this Item, it must disclose the name of the audit committee financial expert and whether that person is independent. In order to be considered independent for purposes of this Item, a member of an audit committee may not, other than in his or her capacity as a member of the audit committee, the board of directors, or any other board committee: |
(i) | Accept directly or indirectly any consulting, advisory, or other compensatory fee from the issuer; or |
(ii) | Be an interested person of the investment company as defined in Section 2(a)(19) of the Act (15 U.S.C. § 80a-2(a)(19)). |
(3) | If the registrant provides the disclosure required by paragraph (a)(1)(ii) of this Item, the registrant must explain why the registrant does not have an audit committee financial expert. |
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3(a)(1) | The registrants board of trustees has determined that the registrant has at least one audit committee financial expert serving on boards audit committee. |
3(a)(2) | The audit committee financial expert of the registrants board of trustees is Paula H.J. Cholmondeley, who, for purposes of this Item 3 of Form N-CSR, is an independent trustee of the registrant. |
Item 4. Principal Accountant Fees and Services.
(a) Disclose, under the caption Audit Fees, the aggregate fees billed for each of the last two fiscal years for professional services rendered by the principal accountant for the audit of the registrants 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.
(b) Disclose, under the caption Audit-Related Fees, the aggregate fees billed in each of the last two fiscal years for assurance and related services by the principal accountant that are reasonably related to the performance of the audit of the registrants financial statements and are not reported under paragraph (a) of this Item. Registrants shall describe the nature of the services comprising the fees disclosed under this category.
(c) Disclose, under the caption Tax Fees, the aggregate fees billed in each of the last two fiscal years for professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning. Registrants shall describe the nature of the services comprising the fees disclosed under this category.
(d) Disclose, under the caption All Other Fees, the aggregate fees billed in each of the last two fiscal years for products and services provided by the principal accountant, other than the services reported in paragraphs (a) through (c) of this Item. Registrants shall describe the nature of the services comprising the fees disclosed under this category.
4(a) through 4(d): The information in the table below is provided for services rendered to the registrant by the registrants principal accountant, PricewaterhouseCoopers LLP (PwC), for the registrants fiscal years ended July 31, 2013, and July 31, 2014.
2013 | 2014 | |||||||
Audit Fees |
N/A | $ | 414,500 | |||||
Audit-Related Fees |
N/A | $ | 0 | |||||
Tax Fees |
N/A | $ | 83,675 | |||||
All Other Fees |
N/A | $ | 0 | |||||
Total |
N/A | $ | 498,175 |
The information in the table below is provided with respect to non-audit services that directly relate to the registrants operations and financial reporting and that were rendered by PwC to the registrants investment adviser, Nationwide Fund Advisors (NFA), and any service provider to the registrant controlling, controlled by, or under common control with NFA that provided ongoing services to the registrant (hereinafter referred to collectively as the Covered Services Provider), for the registrants fiscal years ended July 31, 2013, and July 31, 2014.
2013 | 2014 | |||||||
Audit-Related Fees |
N/A | $ | 34,000 | |||||
Tax Fees |
N/A | $ | 25,000 | |||||
All Other Fees |
N/A | $ | 0 | |||||
Total |
N/A | $ | 59,000 |
(e) (1) Disclose the audit committees pre-approval policies and procedures described in paragraph (c)(7) of Rule 2-01 of Regulation S-X.
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(2) Disclose the percentage of services described in each of paragraphs (b) through (d) of this Item that were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
4(e)(1) Pre-Approval Policies and Procedures. The Audit Committee (the Committee) of the registrant is responsible for pre-approving (i) all audit and permissible non-audit services to be provided by the independent auditors to the registrant and (ii) all permissible non-audit services to be provided by the independent auditors to NFA and any Covered Services Provider if the engagement relates directly to the operations and financial reporting of the registrant. The Committee may delegate the Committees responsibility to pre-approve any such audit and permissible non-audit services to the Chairperson of the Committee, and the Chairperson shall report to the Committee, at the Committees next regularly-scheduled meeting after the Chairpersons pre-approval of such services, his or her decision(s).
The Committee also may establish detailed pre-approval policies and procedures for pre-approval of these services in accordance with applicable laws, including the delegation of some or all of the Committees pre-approval responsibilities to other persons (other than NFA or the registrants officers). Pre-approval by the Committee of any permissible non-audit services shall not be required so long as: (i) the aggregate amount of all said permissible non-audit services provided to the registrant, NFA, and any Covered Services Provider constitutes not more than five percent (5%) of the total amount of revenues paid by the registrant to the registrants independent auditors during the fiscal year in which the permissible non-audit services are provided; (ii) the permissible non-audit services were not recognized by the registrant at the time of the engagement to be non-audit services; and (iii) these services are promptly brought to the attention of the Committee and approved by the Committee (or the Committees delegate(s)) prior to the completion of the audit.
At the close of business on September 16, 2013, the Nationwide HighMark Balanced Fund, Nationwide Bailard Cognitive Value Fund, Nationwide Bailard Technology & Science Fund, Nationwide Ziegler Equity Income Fund, Nationwide Geneva Mid Cap Growth Fund, Nationwide Geneva Small Cap Growth Fund, Nationwide Bailard International Equities Fund, Nationwide HighMark Large Cap Core Equity Fund, Nationwide HighMark Large Cap Growth Fund, Nationwide Ziegler NYSE Arca Tech 100 Index Fund, Nationwide HighMark Small Cap Core Fund, Nationwide HighMark Value Fund, Nationwide HighMark Bond Fund, Nationwide HighMark Short Term Bond Fund, Nationwide HighMark California Intermediate Tax Free Bond Fund, Nationwide HighMark National Intermediate Tax Free Bond Fund and Nationwide Ziegler Wisconsin Tax Exempt Fund (collectively, the Nationwide HighMark Funds) acquired the assets, subject to stated liabilities, of the HighMark Balanced Fund, HighMark Cognitive Value Fund, HighMark Enhanced Growth Fund, HighMark Equity Income Fund, HighMark Geneva Mid Cap Growth Fund, HighMark Geneva Small Cap Growth Fund, HighMark International Opportunities Fund, HighMark Large Cap Core Equity Fund, HighMark Large Cap Growth Fund, HighMark NYSE Arca Tech 100 Index Fund, HighMark Small Cap Core Fund, HighMark Value Fund, HighMark Bond Fund, HighMark Short Term Bond Fund, HighMark California Intermediate Tax-Free Bond Fund, HighMark National Intermediate Tax-Free Bond Fund and HighMark Wisconsin Tax-Exempt Fund (collectively, the HighMark Funds), respectively, through a reorganization transaction (the Reorganization).
Prior to the Reorganization, HighMark Capital Management, Inc. (HighMark), an indirect, wholly owned subsidiary of Mitsubishi UFJ Financial Group, Inc. (Mitsubishi UFJ), served as the investment adviser to the HighMark Funds. Mitsubishi UFJ, as such, was an affiliate of the HighMark Funds. For the period of August 1, 2013 to September 16, 2013, PwC provided services to Mitsubishi UFJ and its related entities (collectively Mitsubishi) that are inconsistent with the auditor independence rules provided in Rule 2-01 of Regulation S-X (Rule 2-01) if provided to an affiliate of an audit client. Some of those services included secondment of PwC staff to Mitsubishi, project management office services, payroll processing, and acting as a tax agent. The Audit Committee and PwC each considered the impact that these services have on PwCs independence with respect to the Nationwide HighMark Funds. The Audit Committee considered that the Nationwide HighMark Funds records under audit are under the control of Nationwide HighMark Funds management, who are responsible for those records for the year and for the preparation of the financial statements being audited by PwC, and considered statements by management to the
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effect that there was and will be no involvement of Mitsubishi in overseeing the preparation of financial statements of the Nationwide HighMark Funds that PwC is auditing and that an unaffiliated third party maintained the books and records of the HighMark Funds during the period in question. The Audit Committee further considered statements by PwC to the effect that the services provided by PwC to Mitsubishi were unrelated to the Highmark Funds and were performed by persons who will not be part of the PwC team that audits the Nationwide HighMark Funds. On the basis of the information provided by PwC, and in particular various mitigating factors such as the fact that PwC has maintained and will continue to maintain SEC level independence of the Nationwide Funds and their affiliates, the Audit Committee determined that the activities of PwC that cause it not to qualify as an independent accountant for the Nationwide HighMark Funds are not of such a nature or extent as to impair the ability of PwC to perform the proposed audits of the Nationwide HighMark Funds impartially and in accordance with applicable auditing standards. PwC has concluded that no reasonable reader of the financial statements of the Nationwide HighMark Funds would believe that PwC lacked objectivity to render the reports on those financial statements. Accordingly, and for the reasons enumerated above, PwC concludes that the services identified do not affect its ability to render an objective audit for the Nationwide HighMark Funds for the year ending July 31, 2014.
4(e)(2) The information in the table below sets forth the percentages of fees for services (other than audit, review, or attest services) rendered by PwC to the registrant for which the pre-approval requirement was waived pursuant to Rule 2-01(c)(7)(i)(C) of Regulation S-X, for the registrants fiscal-years ended July 31, 2013, and July 31, 2014:
2013 | 2014 | |||||||
Audit-Related Fees |
N/A | None | ||||||
Tax Fees |
N/A | None | ||||||
All Other Fees |
N/A | None | ||||||
Total |
N/A | None |
The information in the table below sets forth the percentages of fees for services (other than audit, review, or attest services) rendered by PwC to NFA and any Covered Services Provider required to be approved pursuant to Rule 2-01(c)(7)(ii) of Regulation S-X, for the registrants fiscal-years ended July 31, 2013, and July 31, 2014:
2013 | 2014 | |||||||
Audit-Related Fees |
N/A | N/A | ||||||
Tax Fees |
N/A | N/A | ||||||
All Other Fees |
N/A | N/A | ||||||
Total |
N/A | N/A |
(f) If greater than 50 percent, disclose the percentage of hours expended on the principal accountants engagement to audit the registrants financial statements for the most recent fiscal year that were attributed to work performed by persons other than the principal accountants full-time, permanent employees.
4(f) Not Applicable: The percentage of hours expended to audit the registrants financial statements for the fiscal-year ended July 31, 2014, that were attributed to work performed by persons other than PwCs full-time, permanent employees was not over fifty percent (50%).
(g) Disclose the aggregate non-audit fees billed by the registrants accountant for services rendered to the registrant, and rendered to the registrants investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant for each of the last two fiscal years of the registrant.
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4(g) The aggregate fees billed by PwC for non-audit services rendered to the registrant and service affiliates for the fiscal-years ended July 31, 2013, and July 31, 2014, were $0 and $0, respectively.
(h) Disclose whether the registrants audit committee of the board of directors has considered whether the provision of non-audit services that were rendered to the registrants investment adviser (not including any subadviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountants independence.
4(h) The registrants Audit Committee has considered whether the provision by PwC of non-audit services to NFA and Covered Services Providers, that were not pre-approved pursuant to Rule 2-01(c)(7)(ii) of Regulation S-X because these services did not directly relate to the registrants operations and financial reporting, is compatible with maintaining PwCs independence.
Item 5. Audit Committee of Listed Registrants.
(a) | If the registrant is a listed issuer as defined in Rule 10A-3 under the Exchange Act (17CFR § 240.10A-3), state whether or not the registrant has a separately-designated standing audit committee established in accordance with Section 3(a)(58)(A) of the Exchange Act (15 U.S.C. § 78c(a)(58)(A)). If the registrant has such a committee, however designated, identify each committee member. If the entire board of directors is acting as the registrants audit committee as specified in Section 3(a)(58)(B) of the Exchange Act (15 U.S.C. § 78c(a)(58)(B)), so state. |
Not Applicable: The registrant is not a listed issuer as defined in Rule 10A-3 under the Exchange Act.
(b) | If applicable, provide the disclosure required by Rule 10A-3(d) under the Exchange Act (17 CFR § 240.10A-3(d)) regarding an exemption from the listing standards for all audit committees. |
Not Applicable: The registrant is not a listed issuer as defined in Rule 10A-3 under the Exchange Act.
Item 6. Investments.
(a) | File Schedule I Investments in securities of unaffiliated issuers as of the close of the reporting period as set forth in § 210.1212 of the Regulation S-X [17 CFR § 210.12-12], unless the schedule is included as part of the report to shareholders filed under Item 1 of this Form. |
This schedule is included as part of the report to shareholders filed under Item 1 of this Form N-CSR.
(b) | If the registrant has divested itself of securities in accordance with Section 13(c) of the Investment Company Act of 1940 following the filing of its last report on Form N-CSR and before filing of the current report, disclosed the following information for each such divested security: |
(1) | Name of the issuer; |
(2) | Exchange ticker symbol; |
(3) | Committee on Uniform Securities Identification Procedures (CUSIP) number; |
(4) | Total number of shares or, for debt securities, principal amount divested; |
(5) | Date(s) that the securities were divested; |
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(6) | If the registrant holds any securities of the issuer on the date of filing, the exchange ticker symbol; CUSIP number; and the total number of shares or, for debt securities, principal amount held on the date of filing; and |
(7) | Name of the statute that added the provision of Section 13(c) in accordance with which the securities were divested. |
This Item 6(b) shall terminate one year after the date on which all statutory provisions that underlie Section 13(c) of the Investment Company Act of 1940 have terminated.
The Registrant made no divestments of securities in accordance with Section 13(c) of the Investment Company Act of 1940.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
A closed-end management investment company that is filing an annual report on this Form N-CSR must, unless it invests exclusively in non-voting securities, describe the policies and procedures that it uses to determine how to vote proxies relating to portfolio securities, including the procedures that the company uses when a vote presents a conflict between the interests of its shareholders, on the one hand, and those of the companys investment adviser; principal underwriter; or any affiliated person (as defined in Section 2(a)(3) of the Investment Company Act of 1940 (15 U.S.C. § 80a-2(a)(3)) and the rules thereunder) of the company, its investment adviser, or its principal underwriter, on the other. Include any policies and procedures of the companys investment adviser, or any other third party, that the company uses, or that are used on the companys behalf, to determine how to vote proxies relating to portfolio securities.
Not Applicable: The registrant is an open-end management investment company, not a closed-end management investment company.
Item 8. Portfolio Managers of Closed-End Management Investment Company.
If the registrant is a closed-end management investment company that is filing an annual report on this Form N-CSR, provide the information specified in paragraphs (a) and (b) of this Item with respect to portfolio managers.
Not Applicable: The registrant is an open-end management investment company, not a closed-end management investment company.
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
If the registrant is a closed-end management investment company, provide the information specified in paragraph (b) of this Item with respect to any purchase made by or on behalf of the registrant or any affiliated purchaser, as defined in Rule 10b-18(a)(3) under the Exchange Act (17 CFR § 240.10b-18(a)(3)), of shares or other units of any class of the registrants equity securities that is registered by the registrant pursuant to Section 12 of the Exchange Act (15 U.S.C. § 781).
Not Applicable: The registrant is an open-end management investment company, not a closed-end management investment company.
Item 10. Submission of Matters to a Vote of Security Holders.
Describe any material changes to the procedures by which shareholders may recommend nominees to the registrants board of directors, where those changes were implemented after the registrant last provided disclosure in response to the requirements of Item 7(d)(2)(ii)(G) of Schedule 14A (17 CFR § 240.14a-101), or this Item.
The Independent Trustees and the Board of Trustees of the registrant adopted a formal, written Policy Regarding Shareholder Submission of Trustee Candidates, as well as a formal, written Statement of Policy On Criteria For Selecting Trustees, on June 9, 2005, and June 10, 2005,
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respectively. Neither this policy nor this statement of policy has been materially changed since the Board of Trustees adoption of the policy and the statement of policy, respectively. The Nominating and Fund Governance Committee of the Board of Trustees (the NFGC) and the Board of Trustees, however, on November 11, 2005, and January 12, 2006, respectively, approved amendments to this policy; these amendments to the policy, though, concerned the criteria for selecting candidates for Trustees and the characteristics expected of candidates for Trustees, as set forth in the Exhibit A, Statement of Policy On Criteria For Selecting Trustees, to the policy and, arguably, may not be deemed to be material changes to the policy.
{NOTE THIS IS REQUIRED BEGINNING WITH THE FIRST REPORTING PERIOD ENDING AFTER JANUARY 1, 2004. For purposes of this Item, adoption of procedures by which shareholders may recommend nominees to the registrants board of directors, where the registrants most recent proxy disclosure (in response to the requirements of Item 7(d)(2)(ii)(G) of Schedule 14A (17 CFR § 240.14a-101)), or this Item, indicated that the registrant did not have in place such procedures, will constitute a material change.}
Item 11. Controls and Procedures.
(a) Disclose the conclusions of the registrants principal executive and principal financial officers, or persons performing similar functions, regarding the effectiveness of the registrants disclosure controls and procedures (as defined in Rule 30a-3(c) under the Act (17 CFR § 270.30a-3(c))) as of a date within 90 days of the filing date of the report that includes the disclosure required by this paragraph, based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the Act (17 CFR § 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Exchange Act (17 CFR § 240.13a-15(b) or § 240.15d-15(b)).
The registrants principal executive officer and principal financial officer have concluded, based on their evaluation of the registrants disclosure controls and procedures as conducted within ninety (90) days of the filing date of this report, that these disclosure controls and procedures are adequately designed and are operating effectively to ensure that information required to be disclosed by the registrant on Form N-CSR is: (i) accumulated and communicated to the investment companys management, including the investment companys certifying officers, to allow timely decisions regarding required disclosure; and (ii) recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commissions rules and forms.
(b) Disclose any change in the registrants internal control over financial reporting (as defined in Rule 30a-3(d) under the Act (17 CFR § 270.30a-3(d)) that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting.
There were no changes in the registrants internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that have materially affected or are reasonably likely to materially affect, the registrants internal control over financial reporting.
Item 12. Exhibits.
(a) File the exhibits listed below as part of this Form. Letter or number the exhibits in the sequence indicated.
(a)(1) Any code of ethics, or amendment thereto, that is the subject of the disclosure required by Item 2, to the extent that the registrant intends to satisfy the Item 2 requirements through filing of an exhibit.
The code of ethics that is the subject of the disclosure required by Item 2 is attached hereto.
(a)(2) A separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the Act (17 CFR § 270.30a-2).
Certifications pursuant to Rule 30a-2(a) are attached hereto.
(a)(3) Any written solicitation to purchase securities under Rule 23c-1 under the Act (17 CFR § 270.23c-1) sent or given during the period covered by the report by or on behalf of the registrant to ten (10) or more persons.
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Not Applicable.
(b) If the report is filed under Section 13(a) or 15(d) of the Exchange Act, provide the certifications required by Rule 30a-2(b) under the Act as an exhibit. A certification furnished pursuant to this paragraph will not be deemed filed for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Exchange Act, except to the extent that the registrant incorporates it by reference.
Certifications pursuant to Rule 30a-2(b) are furnished herewith.
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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.
(Registrant) | NATIONWIDE MUTUAL FUNDS | |||
By (Signature and Title) | /s/ Joseph A. Finelli | |||
Name: | Joseph A. Finelli | |||
Title: | Principal Financial Officer | |||
Date: | October 1, 2014 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
NATIONWIDE MUTUAL FUNDS | ||||
By (Signature and Title) | /s/ Michael S. Spangler | |||
Name: | Michael S. Spangler | |||
Title: | Principal Executive Officer | |||
Date: | October 1, 2014 | |||
NATIONWIDE MUTUAL FUNDS | ||||
By (Signature and Title) | /s/ Joseph A. Finelli | |||
Name: | Joseph A. Finelli | |||
Title: | Principal Financial Officer | |||
Date: | October 1, 2014 |
* | Print the name and title of each signing officer under his or her signature. |
NATIONWIDE MUTUAL FUNDS
&
NATIONWIDE VARIABLE INSURANCE TRUST
CODE OF ETHICS
FOR
PRINCIPAL EXECUTIVE AND FINANCIAL OFFICERS
(As Amended and Restated As of May 1, 2007;
As Most-Recently Revised As of June 15, 2011)
I. | Introduction |
Section 406 of the Sarbanes-Oxley Act of 2002. The Board of Trustees of each of Nationwide Mutual Funds (NMF) and Nationwide Variable Insurance Trust (NVIT) (NMF and NVIT hereinafter referred to collectively as the Company) has adopted this code of ethics (this Code) to comply with Item 2 of Form N-CSR,1 which implements Section 406 of the Sarbanes-Oxley Act of 2002 (the 2002 Act). Section 406 of the 2002 Act requires disclosure by management investment companies that are registered with the Securities and Exchange Commission (the SEC) under the Investment Company Act of 1940, as amended (the 1940 Act), concerning a code of ethics for principal executive and financial officers of these investment companies.
Covered Persons Under the Code . This Code of the Company is applicable to the Companys chief executive officer (the CEO) and the Companys senior financial officers (e.g., the Companys treasurer and assistant treasurers) (said CEO and senior financial officers hereinafter referred to collectively as the Covered Officers). See Exhibit A to this Code.
This Code is intended to promote:
| honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships; |
1 | Item 2 of Form N-CSR requires a registered management investment company to disclose annually whether, as of the end of the period covered by the report, that company has adopted a code of ethics that applies to the registrants principal executive officer, principal financial officer, principal accounting officer, or controller, or persons performing similar functions. If the registrant has not adopted such a code of ethics, the registrant must explain why the registrant has not done so. Under Item 2, the registrant also must: (1) file with the Securities and Exchange Commission a copy of the code as an exhibit to the registrants annual report; (2) post the text of the code on the registrants Internet website and disclose, in the registrants annual report, the registrants Internet address, and the fact that the registrant has posted the code on the registrants Internet website; or (3) undertake in the registrants most recently filed semi-annual report on Form N-CSR to provide to any person without charge, upon request, a copy of the code and explain the manner in which this request may be made. Disclosure also is required of amendments to, or waivers (including implicit waivers) from, a provision of the code in the registrants annual report on Form N-CSR or on the registrants website. If the registrant intends to satisfy the disclosure requirement by posting this information on the registrants website, the registrant will be required to disclose the registrants Internet address and this intention. Investment companies must make the disclosure discussed in this footnote regardless of whether these officers are employed by the registrant or a third party. |
| full, fair, accurate, timely, and understandable disclosure in reports and documents that the Company files with, or submits to, the SEC and in other public communications made by the Company; |
| compliance with applicable governmental laws, rules and regulations; |
| the prompt internal reporting to an appropriate person or persons identified in the Code of violations of the Code; and |
| accountability for adherence to the Code. |
Designated Persons Under the Code. As set forth in greater detail below, the Covered Officers shall report to either: (i) one of the officers of the Company set forth in Exhibit B (each hereinafter referred to as a Nationwide Designated Person); and/or (ii) a member of the Audit Committee of the Board of Trustees of the Company (each hereinafter referred to as an Audit Committee Designated Person) (the Nationwide Designated Person and the Audit Committee Designated Person hereinafter referred to collectively as the Designated Persons, and singly as the Designated Person, as appropriate). See Exhibit B to this Code.
Roles and Responsibilities of the Designated Persons and the Independent Trustees. As discussed in greater detail below, given the seniority of the Covered Officers:
i. | the Nationwide Designated Person shall be responsible for conducting investigations of potential violations of the Code by Covered Officers (other than the CEO of the Company) brought to the attention of the Nationwide Designated Person, and: |
a. | with respect to such conduct or activity, shall be responsible for making a preliminary determination whether or not such conduct or activity will violate or has violated this Code; |
b. | shall be responsible for making a preliminary determination whether or not to grant a waiver2 to the Covered Officer for such conduct or activity or, in the case if past conduct or activity, whether or not to sanction the Covered Officer for such activity; |
2 | Item 2 of Form N-CSR defines waiver as the approval by the registrant of a material departure from a provision of the code of ethics and implicit waiver, which also must be disclosed in the Form N-CSR, as the registrants failure to take action within a reasonable period of time regarding a material departure from a provision of the code of ethics that has been made known to an executive officer of the registrant. See also Rule 3b-7 under the Securities Exchange At of 1934, as amended (17 C.F.R. § 240.3b-7). |
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ii. | the Nationwide Designated Person promptly shall report to the Trustees of the Company who are not interested persons of the Company, as that term is defined in Section 2(a)(19) of the 1940 Act (hereinafter, the Independent Trustees): |
a. | his or her preliminary determination whether or not any such conduct or activity has violated or will violate this Code; and |
b. | his or her preliminary determination whether or not any such conduct or activity should be the subject of a waiver or, in the case of past conduct, a sanction; |
iii. | the Audit Committee Designated Person shall be responsible for conducting investigations of potential violations of the Code by the CEO of the Company brought to the attention of the Audit Committee Designated Person, and: |
a. | with respect to such conduct or activity, shall be responsible for making a preliminary determination whether or not such conduct or activity will violate or has violated this Code; and |
b. | with respect to such conduct or activity, also shall be responsible for making a preliminary determination whether or not to grant a waiver to the CEO for such conduct or activity or, in the case of past conduct or activity, whether or not to sanction the CEO for such conduct or activity; |
iv. | the Audit Committee Designated Person promptly shall report to the Independent Trustees: |
a. | his or her preliminary determination whether or not any such conduct or activity has violated or will violate this Code; and |
b. | his or her preliminary determination whether or not any such conduct or activity should be the subject of a waiver or, in the case of past conduct, a sanction; |
v. | the Independent Trustees shall be solely responsible for promptly determining whether or not: (a) to accept the preliminary determinations made by the Designated Person with respect to potential violations of the Code; and (b) to grant waivers under this Code and these determinations of the Independent Trustees shall be final; |
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vi. | the Independent Trustees further shall be solely responsible for taking all necessary and appropriate disciplinary or preventive action(s) (necessary and appropriate disciplinary or preventive action(s) may include a letter of censure, suspension, dismissal, or, in the event of criminal or other serious violations of law, notification to the SEC and/or appropriate law enforcement authorities) in regard to any existing, actual, or potential violation of this Code by any Covered Officer; and |
vii. | all determinations made by the Designated Persons and Independent Trustees shall be in writing. |
II. | Covered Officers Should Act Honestly and Candidly |
Each Covered Officer owes a duty to the Company to act with integrity. Integrity requires, among other things, being honest and candid. Deceit and subordination of principle are inconsistent with integrity.
Each Covered Officer must:
| act with integrity, including being honest and candid while still maintaining the confidentiality of information where required by law or the Companys policies; |
| observe applicable governmental laws, rules and regulations, accounting standards, and Company policies; |
| adhere to a high standard of business ethics; and |
| place the interests of the Company before the Covered Officers own personal interests. |
All activities of Covered Officers should be guided by and adhere to these standards.
III. | Covered Officers Should Handle Ethically |
Actual and Apparent Conflicts of Interest
General Principle. The 1940 Act is designed, in part, to address inherent conflicts of interest that exist in the management of an investment companys assets by a third party (i.e., the investment companys investment adviser). The principles set forth in this section relating to conflicts of interest reflect the fact that investment companies already are subject to prohibitions on certain activities, including self-dealing, and substantial limitations regarding conflicts of interest by the 1940 Act and the SEC rules promulgated thereunder. In light of the existing structural, statutory, and regulatory environment for registered investment companies, a code of ethics broader than necessary to meet the new 2002 Act code of ethics requirement may be unnecessary. This Code,
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however, is intended to require the Covered Officers to adhere to the general principle that those persons responsible for managing other peoples money should be held to the highest standards of integrity.
Guiding Principles. A conflict of interest occurs when an individuals private interest interferes with the interests of, or his/her service to, the Company and the shareholders of the Company. A conflict of interest can arise when a Covered Officer has interests that may make it difficult to perform that Covered Officers Company work objectively. For example, a conflict of interest would arise if a Covered Officer, or a member of the Covered Officers family, receives improper personal benefits as a result of the Covered Officers position in the Company. In addition, investment companies also should be sensitive to situations that create apparent conflicts of interest. Service to the Company should never be subordinated to personal gain and advantage.
Certain conflicts of interest covered by this Code arise out of the relationships between Covered Officers and the Company that already are subject to conflict of interest provisions in the 1940 Act. For example, Covered Officers may not individually engage in certain transactions (such as the purchase or sale of securities or other property) with the Company because of the status of Covered Officers as affiliated persons of the Company, as that term is defined at Section 2(a)(3) of the 1940 Act. The Companys compliance programs and procedures are designed to prevent, and identify and correct, violations of these provisions. This Code does not, and is not intended to, repeat or replace these programs and procedures, and these conflicts fall outside of the parameters of this Code.
Although typically not presenting an opportunity for improper personal benefit, conflicts arise from, or as a result of, the contractual relationship between, the Company and the investment adviser(s) of which the Covered Officers also are officers or employees. As a result, this Code recognizes that the Covered Officers, in the normal course of their duties (whether formally for the Company or for the adviser, or for both), shall be involved in establishing policies and implementing decisions which will have different effects on the investment adviser and the Company. The participation of the Covered Officers in these activities is inherent in the contractual relationship between the Company and the investment adviser and is consistent with the performance by the Covered Officers of their duties as officers of the Company. Thus, if these activities are performed by the Covered Officer in conformity with the provisions of the 1940 Act, the activity will be deemed to have been handled ethically. In addition, it is recognized by the Board of Trustees of the Company that the Covered Officers also may be officers or employees of other investment companies advised by the same adviser and, accordingly, the principles of this paragraph shall further apply to the Covered Officers acting in these capacities as well.
Responsibilities of Covered Officers. In accordance with these principles, each Covered Officer must:
| avoid conflicts of interest wherever possible; |
| handle any actual or apparent conflict of interest ethically; |
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| not use the Covered Officers personal influence or personal relationships to influence investment decisions or financial reporting by the Company whereby the Covered Officer would benefit personally to the detriment of the Company; |
| not cause the Company to take action, or fail to take action, for the personal benefit of the Covered Officer rather than for the benefit of said Company; |
| not use material non-public knowledge of portfolio transactions made or contemplated for the Company to profit or cause others to profit, by the market effect of these transactions; |
| as described in more detail below, discuss with the appropriate Designated Person any material transaction or relationship that could reasonably be expected to give rise to a conflict of interest; and |
| report at least annually to the Company on the Companys Trustees & Officers Questionnaire any and all material transactions, affiliations, or relationships that could reasonably be expected to give rise to, or be related to, a conflict of interest. |
Conflict of Interest Situations: Certain conflict of interest situations that always should be discussed by a Covered Officer with the appropriate Designated Person include the following:
| any outside business activity that detracts from an individuals ability to devote appropriate time and attention to his or her responsibilities with the Company; |
| service as a director on the board of any public or private company; |
| the receipt of any non-nominal or non de minimis gifts (i.e., gifts in excess of $500.00) from any company with which the Company has current or prospective business dealings; |
| the receipt of any entertainment from any company with which the Company has current or prospective business dealings, unless said entertainment is business related, reasonable in cost (not greater than $500), appropriate as to time and place, and not so frequent as to raise any question of impropriety; |
| being in the position of supervising, reviewing, or having any influence on the job evaluation, pay, or benefit of any immediate family member; |
| any ownership interest in, or any consulting or employment relationship with, any of the Companys service providers, other than the Companys investment adviser or administrator or any of the Companys other affiliates; and |
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| a direct or indirect financial interest in commissions, transaction charges, or spreads paid by the Company for effecting portfolio transactions or for selling or redeeming shares other than an interest arising from the Covered Officers employment, such as compensation or equity ownership. |
In addition, any activity or relationship that would present a conflict of interest for a Covered Officer also likely would present a conflict for the Covered Officer if a member of the Covered Officers family engages in such an activity or has such a relationship.
IV. | Disclosure |
Each Covered Officer must:
| familiarize himself or herself with the disclosure requirements applicable to the Company as well as with the business and financial operations of the Company; |
| not knowingly misrepresent, or cause others to misrepresent, facts about the Company to others, whether within or outside the Company, including, among others, the Companys auditors, directors, and governmental regulators and self-regulatory organizations; |
| each Covered Officer should, to the extent appropriate within his or her area of responsibility, consult with other officers and employees of the Company and the Companys adviser or sub-adviser and administrator with the goal of promoting full, fair, accurate, timely, and understandable disclosure in the reports and documents the Company files with, or submits to, the SEC and in other public communications made by the company; and |
| it is the responsibility of each Covered Person to promote compliance with the standards and restrictions imposed by applicable laws, rules, and regulations. |
V. | Compliance |
It is the Companys policy to comply with all applicable governmental laws, rules and regulations, including, among others, those laws, rules, and regulations relating to affiliated transactions, accounting, and auditing matters. It is the personal responsibility of each Covered Officer to adhere to the standards and restrictions imposed by these laws, rules, and regulations.
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VI. | Accountability, Reporting, and Enforcement Responsibilities Under the Code |
Responsibilities of the Covered Officers: Each Covered Officer must:
| upon becoming a Covered Officer, sign and submit to the appropriate Designated Person an acknowledgment stating that the Covered Officer has received, has read, and understands the Code (see Exhibit C to this Code); |
| annually thereafter, submit a form to the appropriate Designated Person confirming that the Covered Officer has received, has read, and understands the Code and has complied with the requirements of the Code (see Exhibit D to this Code); |
| not retaliate against any employee, Designated Person, Covered Officer, or their affiliated persons ,for reports of potential violations that are made in good faith; and |
| notify the appropriate Designated Person promptly if the Covered Officer becomes aware of any existing or potential violation of this Code (failure to notify the appropriate Designated Person under these circumstances is itself a violation of this Code). |
General Responsibilities of the Designated Persons: Except as otherwise described herein, the Designated Person: (i) shall be responsible for applying this Code to specific situations in which questions are presented to the Designated Person; and (ii) has the authority to interpret this Code in any particular situation. The Designated Person shall take all actions that the Designated Person considers necessary and appropriate to investigate any existing, actual, or potential violations reported to the Designated Person.
Specific Accountability & Reporting Responsibilities: The Designated Person shall report, in writing, quarterly to the Independent Trustees all determinations with respect to potential violations of the Code, if any, made during the previous quarter.
The Independent Trustees shall report, in writing, quarterly to the full Board of Trustees all actions taken under this Code with respect to the previous quarter.
Authorized Consulting Persons: In addition, a Designated Person, as appropriate, is authorized to consult with the following persons (hereinafter referred to as the Authorized Consulting Persons), and is encouraged to do so: (i) any other Designated Person; (ii) the chairperson of the Nominating and Board Governance Committee of the Board of Trustees of the Company; (iii) the Independent Trustees of the Company; (iv) the Board of Trustees of the Company; (v) counsel to the Company; and/or (vi) counsel to the Independent Trustees.
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VII. | Other Policies and Procedures |
This Code is not adopted under, nor intended to serve as a basis for complying with the requirements of, Rule 17j-1 under the 1940 Act (in regard to the reporting, disclosure, and preclearance of personal securities transactions and personal securities holdings, and to other related matters covered by Rule 17j-1 under the 1940 Act) .
The codes of ethics adopted by the Company, the Companys investment advisers and principal underwriter pursuant to Rule 17j-1 under the 1940 Act set forth more detailed policies and procedures that are separate requirements which apply to the Covered Officers and other persons, and are not part of this Code.
VIII. | Amendments |
This Code may not be amended except in written form, and such amendments must be approved by a majority vote of the Companys Board of Trustees, including a majority of the Independent Trustees.
IX. | Confidentiality |
All reports and records prepared or maintained pursuant to this Code shall be considered confidential and shall be maintained and protected accordingly. Except as otherwise required by law or this Code, these matters shall not be disclosed to anyone other than Designated Persons and Authorized Consulting Persons.
X. | Internal Use |
This Code is intended solely for the internal use by the Company and does not constitute an admission, by or on behalf of the Company, as to any fact, circumstance, or legal conclusion.
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EXHIBIT A:
Covered Officers Under This Code of Ethics
(As Amended and Restated as of May 1, 2007;
As Most-Recently Revised As of December 16, 2013)
Michael S. Spangler | President & Chief Executive Officer, NMF and NVIT |
|||||
Joseph A. Finelli | Treasurer & Chief Financial Officer, NMF and NVIT |
|||||
Jacqueline A. Payton | Assistant Treasurer, NMF and NVIT |
EXHIBIT B:
Designated Persons Under This Code of Ethics 1
(As Amended and Restated as of May 1, 2007;
As Most-Recently Revised As of December 16, 2013)
Nationwide Designated Person
Each of:
Eric E. Miller | Secretary, NMF and NVIT | |
(Mr. Miller currently also serves as a Senior Vice President and the Chief Counsel for Nationwide Funds Group) |
Brian E. Hirsch | Chief Compliance Officer, NMF and NVIT | |
(Mr. Hirsch currently also serves as a Senior Vice President and the Chief Compliance Officer for Nationwide Funds Group) |
Audit Committee Designated Person
Each member of the Audit Committee
of the Board of Trustees of NMF and NVIT
shall be deemed to be an
Audit Committee Designated Person.
1 | The Securities and Exchange Commission has indicated that any Designated Person of the Company should have sufficient status within the company to engender respect for the code and the authority to adequately deal with the persons subject to the code regardless of their stature in the company. |
EXHIBIT C:
INITIAL CERTIFICATION
NATIONWIDE MUTUAL FUNDS AND
NATIONWIDE VARIABLE INSURANCE TRUST
CODE OF ETHICS FOR SENIOR FINANCIAL OFFICERS
To: | Eric E. Miller, Secretary, NMF and NVIT Brian E. Hirsch, Chief Compliance Officer, NMF and NVIT |
1. | I hereby acknowledge receipt of the Nationwide Mutual Fund and Nationwide Variable Insurance Trust Code of Ethics for Senior Financial Officers (the Code). |
2. | I have read and understand the Code, and I recognize that I am subject thereto in the capacity of a Covered Officer. |
3. | I shall comply with the requirements of the Code, and shall disclose/report all violations or potential violations of the Code as required thereunder. |
4. | As of the date indicated below, I am not aware of any violations or potential violations of the Code. |
Signature: |
|
Name: |
|
Title: |
|
Date Report Submitted: |
|
EXHIBIT D:
ANNUAL CERTIFICATION
NATIONWIDE MUTUAL FUNDS AND
NATIONWIDE VARIABLE INSURANCE TRUST
CODE OF ETHICS FOR SENIOR FINANCIAL OFFICERS
To: | Eric E. Miller, Secretary, NMF and NVIT Brian E. Hirsch, Chief Compliance Officer, NMF and NVIT |
1. | I have read and understand the Nationwide Mutual Fund and Nationwide Variable Insurance Trust Code of Ethics for Senior Financial Officers (the Code), and I recognize that I am subject thereto in the capacity of a Covered Officer. |
2. | I hereby certify that, during the year ended December 31, 2010, I have complied with the requirements of the Code and have reported all violations or potential violations required to be reported pursuant to the Code. |
Signature: |
|
Name: |
|
Title: |
|
Date Report Submitted: |
|
SARBANES-OXLEY ACT SECTION 302 CERTIFICATIONS
I, Joseph A. Finelli, certify that:
1. | I have reviewed this report on Form N-CSR, for the period ended July 31, 2014, of Nationwide Mutual Funds (the registrant); |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; |
4. | The registrants other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940, as amended) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including the registrants consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within ninety (90) days prior to the filing date of this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5. | The registrants other certifying officer(s) and I have disclosed to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize, and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
October 1, 2014 | /s/ Joseph A. Finelli | |||
Date | Joseph A. Finelli | |||
Principal Financial Officer |
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SARBANES-OXLEY ACT SECTION 302 CERTIFICATIONS
I, Michael S. Spangler, certify that:
1. | I have reviewed this report on Form N-CSR, for the period ended July 31, 2014, of Nationwide Mutual Funds (the registrant); |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; |
4. | The registrants other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940, as amended) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including the registrants consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within ninety (90) days prior to the filing date of this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during second quarter of the period covered by the report that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5. | The registrants other certifying officer(s) and I have disclosed to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize, and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
October 1, 2014 | /s/ Michael S. Spangler | |||
Date | Michael S. Spangler | |||
Principal Executive Officer |
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SARBANES-OXLEY ACT SECTION 906 CERTIFICATIONS
This certification is provided pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. § 1350, and accompanies the report on Form N-CSR, for the period ended July 31, 2014, of Nationwide Mutual Funds (the Registrant).
I, Joseph A. Finelli, the Principal Financial Officer of the Registrant, certify, to the best of my knowledge, that:
1. | the report on Form N-CSR fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. § 78m(a) and § 78o(d)); and |
2. | the information contained in the report on Form N-CSR fairly presents, in all material respects, the financial condition and results of operations of the Registrant. |
October 1, 2014
Date
/s/ Joseph A. Finelli |
Joseph A. Finelli |
Principal Financial Officer |
Nationwide Mutual Funds |
This certification is being furnished solely pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and is not being filed as part of Form N-CSR or as a separate disclosure document. A signed original of this written statement required by Section 906 has been provided to the Registrant and will be retained by the Registrant and furnished to the Securities and Exchange Commission (the Commission) or the Commissions staff upon request.
SARBANES-OXLEY ACT SECTION 906 CERTIFICATIONS
This certification is provided pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. § 1350, and accompanies the report on Form N-CSR, for the period ended July 31, 2014, of Nationwide Mutual Funds (the Registrant).
I, Michael S. Spangler, the Principal Executive Officer of the Registrant, certify, to the best of my knowledge, that:
1. | the report on Form N-CSR fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. § 78m(a) and § 78o(d)); and |
2. | the information contained in the report on Form N-CSR fairly presents, in all material respects, the financial condition and results of operations of the Registrant. |
October 1, 2014
Date
/s/ Michael S. Spangler |
Michael S. Spangler |
Principal Executive Officer |
Nationwide Mutual Funds |
This certification is being furnished solely pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and is not being filed as part of Form N-CSR or as a separate disclosure document. A signed original of this written statement required by Section 906 has been provided to the Registrant and will be retained by the Registrant and furnished to the Securities and Exchange Commission (the Commission) or the Commissions staff upon request.
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