N-CSR 1 institann.txt AMERIPRIME ADVISORS 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 811-09541 Ameriprime Advisors Trust (Exact name of registrant as specified in charter) 431 N. Pennsylvania Street , Indianapolis, IN 46204 (Address of principal executive offices) (Zip code) Timothy Ashburn Unified Fund Services, Inc. 431 N. Pennsylvania Street Indianapolis, IN 46204 (Name and address of agent for service) Registrant's telephone number, including area code: 317-917-7000 Date of fiscal year end: 12/31 Date of reporting period: 12/31/03 Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection and policymaking roles. A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. 3507. Item 1. Reports to Stockholders. =============================================================================== Institutional Short-Term Government Bond Fund (The Core Fund) =============================================================================== Annual Report December 31, 2003 Fund Advisor: Wertz York Capital Management Group, LLC 3434 Colwell Ave, Suite 100 Tampa, FL 33614 Toll Free: 877-411-1167 Management Discussion and Analysis Investment Results - Fiscal Year Ended December 31, 2003 As indicated by the following chart, the Institutional Short-Term Government Bond Fund (the Fund) slightly underperformed the 1-Year Constant Maturity Treasury Index (the Index) in fiscal year 2003. The primary reason for underperforming the Index was the historically sharp sell-off of Treasury and Government Agency bonds during the third-quarter which adversely affected the barbell strategy in place. A barbell portfolio strategy combines short-term investments with longer-term investments to construct an overall desired portfolio duration. When bond yields rise, the value of the longer-term bonds may decline, but typically this is offset by a higher reinvestment rate for cash and cash equivalents investments. During the third-quarter, the yields on two to five-year bonds increased dramatically. However, the yields on money market instruments did not rise. The result was capital losses on longer-term holdings while the reinvestment rate and interest on money market instruments were not high enough to offset those losses. The barbell strategy did not function as expected. However, we are pleased with the overall results of the Fund. In a year of great uncertainty, and extreme volatility in the bond market, the Fund's return was positive and NAV stability was restored after a small degree of fluctuation during the third quarter. Our outlook for 2004 is cautious. The 2003 third and fourth quarter economic data reflected a growing economy. However, the data also revealed that inflation is not a current economic threat. Inflation remains in check in the overall economy and it is our opinion that this will continue for all of 2004. Until there are signs that inflation ramps up in the economy, the Federal Reserve is likely to hold interest rates steady. While it is impossible to predict the actions of the Federal Reserve with certainty, it is our position that rates will remain unchanged for at least the first three quarters of 2004. The overall performance of the Fund will be impacted considerably by Federal Reserve policy. Although our expectations are for the Federal Reserve to keep interest rates on hold until the late 2004 or early 2005, there are likely to be several interest rate shocks preceding an actual Federal Reserve interest rate hike as expectations mount. Moving into 2004, we have positioned the Fund and will continue to position the Fund to react favorably to interest rate shocks. By utilizing a combination of "cushion" bonds, floating rate notes, seasoned balloon mortgage securities and cash investment, we anticipate a year of stability and attractive yields for the Fund's shareholders. ----------------------------------------------------------------------------------------------------- Nominal Rates of Return ------------------------------------------------------------------------------------------------------ Time Period 1-YR CMT Core Fund ---------------------------------- ---------------------------------- -------------------------------- ---------------------------------- ---------------------------------- -------------------------------- 1 Year (2003) 1.24% 1.03% ---------------------------------- ---------------------------------- -------------------------------- ---------------------------------- ---------------------------------- -------------------------------- Inception-to-Date 3.27% 3.57% (January 9, 2002 through December 31, 2003) ---------------------------------- ---------------------------------- --------------------------------
GROWTH OF $250,000 INVESTMENT (2003) 1-Year Constant Institutional Maturity Treasury Short-Term Index($253,093) Government) Bond Fund ($252,562) January $ 250,282 $ 250,320 February $ 250,551 $ 250,956 March $ 250,808 $ 251,431 April $ 251,071 $ 251,939 May $ 251,315 $ 252,357 June $ 251,525 $ 252,735 July $ 251,757 $ 251,110 August $ 252,028 $ 250,985 September $ 252,285 $ 252,915 October $ 252,544 $ 252,325 November $ 252,821 $ 252,209 December $ 253,093 $ 252,562 *This chart shows the value of a hypothetical initial investment of $250,000 in the Fund and the 1-Year Constant Maturity Treasury Index on January 1, 2003 and held through December 31, 2003. The 1-Year Constant Maturity Treasury Index is an unmanaged index of US Treasury bonds. Performance figures reflect the change in value of the bonds in the index and reinvestment of dividends. The index returns do not reflect expenses, which have been deducted from the Fund's return. The returns shown do not reflect deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. THE FUND'S RETURN REPRESENTS PAST PERFORMANCE AND IS NOT PREDICTIVE OF FUTURE RESULTS. GROWTH OF $250,000 (INCEPTION-TO-DATE) 1-Year Constant Institutional Maturity Treasury Short-Term Index($258,174) Government Bond Fund ($258,914) Jan-02 $ 250,446 $ 250,000 Feb-02 $ 250,906 $ 250,000 Mar-02 $ 251,437 $ 249,570 Apr-02 $ 251,951 $ 250,756 May-02 $ 252,439 $ 251,695 Jun-02 $ 252,898 $ 252,175 Jul-02 $ 253,307 $ 252,890 Aug-02 $ 253,676 $ 253,730 Sep-02 $ 254,036 $ 254,344 Oct-02 $ 254,383 $ 255,005 Nov-02 $ 254,697 $ 255,156 Dec-02 $ 255,003 $ 256,291 Jan-03 $ 255,290 $ 256,619 Feb-03 $ 255,565 $ 257,272 Mar-03 $ 255,827 $ 257,761 Apr-03 $ 256,096 $ 258,285 May-03 $ 256,347 $ 258,716 Jun-03 $ 256,561 $ 259,107 Jul-03 $ 256,799 $ 257,423 Aug-03 $ 257,078 $ 257,294 Sep-03 $ 257,342 $ 259,281 Oct-03 $ 257,608 $ 258,669 Nov-03 $ 257,894 $ 258,549 Dec-03 $ 258,174 $ 258,914 *This chart shows the value of a hypothetical initial investment of $250,000 in the Fund and the 1-Year Constant Maturity Treasury Index on January 9, 2002 (Fund inception) and held through December 31, 2003. The 1-Year Constant Maturity Treasury Index is an unmanaged index of US Treasury bonds. Performance figures reflect the change in value of the bonds in the index and reinvestment of dividends. The index returns do not reflect expenses, which have been deducted from the Fund's return. The returns shown do not reflect deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. THE FUND'S RETURN REPRESENTS PAST PERFORMANCE AND IS NOT PREDICTIVE OF FUTURE RESULTS. For a prospectus and more information, including charges and expenses call 1-877-411-1167. The prospectus should be read carefully before investing. The Fund is distributed by Unified Financial Securities, Inc. Institutional Short-Term Government Bond Fund (The Core Fund) Schedule of Investments December 31, 2003 Principal Amount Value --------------- ------------------- Municipal Bonds - 10.27% Municipal Electric Authority of Georgia, 1.19%, 1/1/2020 (a) $ 6,000,000 $ 6,000,000 New York General Obligations Bond, 1.15%, 3/15/2029 (a) 10,500,000 10,500,000 ------------------- TOTAL MUNICIPAL BONDS (Cost $16,500,000) 16,500,000 ------------------- U.S. Government Agency Obligations - 79.28% Federal Home Loan Mortgage Corp - 16.24% 5.000%, 7/30/2009 4,800,000 4,894,267 Pool #C90580, 6.000%, 9/1/2022 1,103,514 1,146,670 Pool #M80692, 6.500%, 7/1/2008 346,912 356,557 Pool #M80718, 5.000%, 1/1/2009 744,543 764,022 Pool #M80739, 6.000%, 3/1/2009 524,904 538,985 Pool #M80753, 6.500%, 5/1/2009 481,935 495,365 Pool #M80765, 5.000%, 8/1/2009 439,709 451,213 Pool #M80828, 4.000%, 7/1/2010 971,636 977,736 Pool #M90727, 6.000%, 5/1/2007 215,208 221,441 Pool #M90747, 5.500%, 8/1/2007 534,751 550,677 Pool #M90779, 5.500%, 11/1/2007 1,831,865 1,886,422 Pool #M90818, 4.000%, 6/1/2008 903,309 919,988 Pool #M90819, 4.500%, 6/1/2008 883,508 906,375 Pool #M90828, 3.500%, 7/1/2008 954,528 959,287 Pool #M90836, 5.000%, 6/1/2008 1,549,705 1,598,789 Series 2494, 6.000%, 4/15/2026 550,890 553,600 Series 2541, 4.500%, 3/15/2032 2,000,000 1,981,392 Series 2558, 5.000%, 5/15/2011 546,940 556,285 Series 2705, 4.500%, 2/15/2023 1,986,825 2,052,247 Series 2712, 4.500%, 2/15/2012 1,979,056 2,037,692 Series MTN, 2.050%, 11/25/2005 238,000 238,503 Series MTN3, 3.050%, 4/16/2007 2,000,000 2,008,808 ------------------ 26,096,321 ------------------ Federal Home Loan Bank - 56.08% 2.150%, 9/30/2005 5,000,000 5,007,135 2.250%, 12/16/2005 4,000,000 4,001,672 2.500%, 7/16/2008 10,000,000 9,880,000 2.530%, 1/24/2007 3,000,000 2,982,060 2.750%, 3/30/2006 2,000,000 2,007,246 3.400%, 7/30/2008 2,000,000 1,992,028 4.000%, 12/29/2006 5,000,000 5,041,690 Series 2105, 1.810%, 5/12/2005 3,000,000 3,005,241 Series 3T08, 2.375%, 12/19/2008 4,300,000 4,295,700 Series A 08, 6.050%, 9/29/2008 (a) 1,000,000 1,065,943 Series AN06, 2.250%, 6/19/2006 2,000,000 1,996,076 Series B606, 1.870%, 9/18/2006 (a) 5,000,000 5,000,160 Series C 05, 8.340%, 8/26/2005 (a) 500,000 528,418 Series CV06, 2.320%, 12/26/2006 3,500,000 3,463,383 Series DF06, 2.310%, 12/22/2006 (a) 20,000,000 19,820,000
See accompanying notes which are an integral part of the financial statements. Institutional Short-Term Government Bond Fund (The Core Fund) Schedule of Investments - continued December 31, 2003 Principal U.S. Government Agency Obligations - 79.28% - continued Amount Value --------------- ------------------- Federal Home Loan Bank - 56.08% - continued Series G609, 4.000%, 2/20/2009 $ 2,000,000 2,006,782 Series Q808, 2.250%, 2/25/2008 6,000,000 6,010,848 Series V305, 1.585%, 4/27/2005 2,000,000 2,000,562 Series XB06, 2.500%, 7/28/2006 2,000,000 2,001,388 Series XE06, 2.050%, 1/27/2006 3,000,000 3,000,798 Series YG06, 2.450%, 4/28/2006 3,000,000 3,002,535 Series YK06, 2.220%, 1/30/2006 2,000,000 2,001,546 ------------------ 90,111,211 ------------------ Federal National Mortgage Association - 6.96% 2.260%, 4/20/2006 2,000,000 $ 2,004,146 Pool #190609, 7.000%, 2/1/2014 600,161 639,873 Pool #252268, 5.500%, 1/1/2009 925,001 963,401 Pool #254506, 5.000%, 10/1/2012 1,311,304 1,355,969 Pool #254566, 4.500%, 11/1/2009 1,408,774 1,430,346 Pool #254586, 5.000%, 1/1/2013 372,719 385,414 Pool #254663, 5.000%, 2/1/2013 1,967,031 2,022,301 Pool #681788, 3.934%, 1/1/2033 2,245,842 2,272,219 Series 2002-57, 5.500%, 11/25/2013 116,910 117,590 ------------------ 11,191,259 ------------------ TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS (Cost $127,539,251) $ 127,398,791 ------------------ Money Market Securities - 10.12% One Group Institutional Prime Money Market, 0.98% (a) 16,255,561 $ 16,255,561 ------------------- TOTAL MONEY MARKET SECURITIES - 99.67% (Cost $16,255,561) 16,255,561 ------------------- TOTAL INVESTMENTS - 99.67% (Cost $160,294,812) $ 160,154,352 ------------------- Assets in excess of other liabilities - 0.33% 529,610 ------------------- TOTAL NET ASSETS - 100.00% $ 160,683,962 ===================
(a) Variable rate security; the coupon rate shown represents the rate at December 31, 2003. See accompanying notes which are an integral part of the financial statements. Institutional Short-Term Government Bond Fund (The Core Fund) Statement of Assets and Liabilities December 31, 2003 Assets Investments in securities, at value (cost $160,294,812) $ 160,154,352 Interest receivable 616,220 ---------------- Total assets 160,770,572 ---------------- Liabilities Accrued advisory fees 63,132 Distribution payable 21,913 Accrued expenses 1,565 ------------------ Total liabilities 86,610 ------------------ Net Assets $ 160,683,962 ================== Net Assets consist of: Capital stock and paid in capital 161,951,817 Accumulated net realized gain (loss) on investments (1,127,395) Net unrealized appreciation (depreciation) on investments (140,460) ------------------ Net Assets, $ 160,683,962 ================== Net Assets Value Net Assets Offering price and redemption price per share ($160,683,962 / 16,242,660 shares outstanding) $ 9.89 ==================
See accompanying notes which are an integral part of the financial statements. Institutional Short-Term Government Bond Fund (The Core Fund) Statement of Operations Year ended December 31, 2003 Investment Income Interest income $ 2,809,049 ------------------ Total Income 2,809,049 ------------------ Expenses Investment adviser fee 1,089,009 Trustee expenses 2,044 ------------------ Total Expenses 1,091,053 Reimbursed expenses (a) (483,154) ------------------ Total operating expenses 607,899 ------------------ Net Investment Income (Loss) 2,201,150 ------------------ Realized & Unrealized Gain (Loss) Net realized gain (loss) on investment securities (1,004,466) Change in net unrealized appreciation (depreciation) on investment securities (343,780) ------------------ Net realized and unrealized gain (loss) on investment securities (1,348,246) ------------------ Net increase (decrease) in net assets resulting from operations $ 852,904 ================== (a) See note 3 to the financial statements.
See accompanying notes which are an integral part of the financial statements. Institutional Short-Term Government Bond Fund (The Core Fund) Statements of Changes In Net Assets Year ended Period ended Increase (Decrease) in Net Assets December 31, 2003 December 31, 2002 (a) ------------------- ------------------- Operations Net investment income (loss) $ 2,201,150 $ 1,328,008 Net realized gain (loss) on investment securities (1,004,466) (122,929) Change in net unrealized appreciation (depreciation) (343,780) 203,320 ------------------- ------------------- Net increase (decrease) in net assets resulting from operations 852,904 1,408,399 ------------------- ------------------- Distributions From net investment income (2,204,943) (1,329,784) From net realized gain - - ------------------- ------------------- Total distributions (2,204,943) (1,329,784) ------------------- ------------------- Capital Share Transactions Proceeds from shares sold 178,610,000 98,238,029 Reinvestment of distributions 1,925,989 1,098,140 Amount paid for shares repurchased (78,347,937) (39,566,835) ------------------- ------------------- Net increase (decrease) in net assets resulting from share transactions 102,188,052 59,769,334 ------------------- ------------------- Total Increase (Decrease) in Net Assets 100,836,013 59,847,949 ------------------- ------------------- Net Assets Beginning of period 59,847,949 - ------------------- ------------------- End of period [including accumulated net investment income (loss) of $0 and $0, respectively] $ 160,683,962 $ 59,847,949 =================== =================== Capital Share Transactions Shares sold 17,947,674 9,837,397 Shares issued in reinvestment of distributions 193,759 110,014 Shares repurchased (7,885,070) (3,961,113) ------------------- ------------------- Net increase (decrease) from capital transactions 10,256,363 5,986,298 =================== =================== (a) For the period January 9, 2002 (commencement of operations) through December 31, 2002.
See accompanying notes which are an integral part of the financial statements. Institutional Short-Term Government Bond Fund (The Core Fund) Financial Highlights Year ended Period ended December 31, 2003 December 31, 2002 (a) -------------------- -------------------- Selected Per Share Data Net asset value, beginning of period $ 10.00 $ 10.00 -------------------- -------------------- Income from investment operations Net investment income (loss) 0.20 0.25 Net realized and unrealized gain (loss) (0.10) - -------------------- -------------------- Total from investment operations 0.10 0.25 -------------------- -------------------- Less Distributions to shareholders: From net investment income (0.21) (0.25) From net realized gain - - -------------------- -------------------- Total distributions (0.21) (0.25) -------------------- -------------------- Net asset value, end of period $ 9.89 $ 10.00 ==================== ==================== Total Return 1.03% 2.52% (b) Ratios and Supplemental Data Net assets, end of period (000) 160,684 $ 59,848 Ratio of expenses to average net assets 0.56% 0.60% (c) Ratio of expenses to average net assets before waiver & reimbursement 1.00% 1.00% (c) Ratio of net investment income to average net assets 2.02% 2.57% (c) Ratio of net investment income to average net assets before waiver & reimbursement 1.58% 2.17% (c) Portfolio turnover rate 194.53% 241.11% (a) For the period January 9, 2002 (commencement of operations) to December 31, 2002. (b) For periods of less than a full year, total return is not annualized. (c) Annualized.
See accompanying notes which are an integral part of the financial statements. Institutional Short-Term Government Bond Fund (The Core Fund) Notes to Financial Statements December 31, 2003 NOTE 1. ORGANIZATION Institutional Short-Term Government Bond Fund (The Core Fund) (the "Fund") was organized as a diversified series of the AmeriPrime Advisors Trust (the "Trust") on September 20, 2001 and commenced operations on January 9, 2002. On March 11, 2003, the Institutional Short-Term Government Bond Fund changed its name to the Institutional Short-Term Government Bond Fund (The Core Fund). The Trust is a registered open-end investment company, established under the laws of Ohio by an Agreement and Declaration of Trust dated August 3, 1999 (the "Trust Agreement"). The Trust Agreement permits the Board of Trustees of the Trust (the "Board") to issue an unlimited number of shares of beneficial interest of separate series without par value. The Fund is one of a series of funds currently authorized by the Board. The Fund's investment objective is a high level of income over the long-term consistent with the preservation of capital. The Fund's adviser is Wertz York Capital Management Group, L.L.C. (the "Adviser"). NOTE 2. SIGNIFICANT ACCOUNTING POLICIES The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. Security Valuation - Fixed income securities generally are valued by using market quotations, but may be valued on the basis of prices furnished by a pricing service when the Adviser believes such prices accurately reflect the fair market value of such securities. A pricing service utilizes electronic data processing techniques based on yield spreads relating to securities with similar characteristics to determine prices for normal institutional-size trading units of debt securities without regard to sale or bid prices. If the Adviser decides that a price provided by the pricing service does not accurately reflect the fair market value of the securities, when prices are not readily available from a pricing service or when restricted or illiquid securities are being valued, securities are valued at fair value as determined in good faith by the Adviser, in conformity with guidelines adopted by and subject to review of the Board. Short term investments in fixed income securities with maturities of less than 60 days when acquired, or which subsequently are within 60 days of maturity, are valued by using the amortized cost method of valuation, which the Board has determined will represent fair value. Federal Income Taxes- There is no provision for federal income tax. The Fund intends to continue to qualify each year as a "regulated investment company" under subchapter M of the Internal Revenue Code of 1986, as amended, by distributing substantially all of its net investment income and net realized capital gains. Security Transactions and Related Income- The Fund follows industry practice and records security transactions on the trade date. The specific identification method is used for determining gains or losses for financial statements and income tax purposes. Dividend income is recorded on the ex-dividend date and interest income is recorded on an accrual basis. Discounts and premiums on securities purchased are amortized over the life of the respective securities. Dividends and Distributions- The Fund intends to distribute substantially all of its net investment income as dividends to its shareholders on a monthly basis and are recorded on the ex-dividend date. The Fund intends to distribute its net realized long term capital gains and its net realized short term capital gains at least once a year. The treatment for financial reporting purposes of distributions made to shareholders during the year from net investment income or net realized capital gains may differ from their ultimate treatment for federal income tax purposes. These differences are caused primarily by differences in the timing of the recognition of certain components of income, expense or realized capital gain for federal income tax purposes. Where such differences are permanent in nature, they are reclassified in the components of the net assets based on their ultimate characterization for federal income tax purposes. Any such reclassifications will have no effect on net assets, results of operations or net asset values per share of the Fund. Institutional Short-Term Government Bond Fund (The Core Fund) Notes to Financial Statements December 31, 2003 - continued NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES The Fund's investment adviser is Wertz York Capital Management Group, L.L.C. Under the terms of the management agreement, (the "Agreement"), the Adviser manages the Fund's investments subject to approval of the Board of Trustees and pays all of the expenses of the Fund except brokerage fees and commissions, taxes, borrowing costs (such as (a) interest and (b) dividend expenses on securities sold short), fees and expenses of non-interested Trustees, and extraordinary expenses. As compensation for its management services and agreement to pay the Fund's expenses, the Fund is obligated to pay the Adviser a fee at the annual rate of 1.00% of the average value of the daily net assets of the Fund. It should be noted that most investment companies pay their own operating expenses directly, while the Fund's expenses, except those specified above, are paid by the Adviser. For the fiscal year ended December 31, 2003 the Adviser earned a fee of $1,089,009 from the Fund. For the period January 1, 2003 through July 31, 2003, the period August 1, 2003 through September 30, 2003, and the period October 1, 2003 through December 31, 2003, the Adviser voluntarily waived 0.40%, 0.45%, and 0.50%, respectively, of the management fee. For the fiscal year ended December 31, 2003, the Adviser waived $483,154 or 0.44% of management fees. At December 31, 2003, the Fund owed the adviser $63,132 for its advisory services. The Fund retains Unified Fund Services, Inc. ("Unified"), a wholly owned subsidiary of Unified Financial Services, Inc., to manage the Fund's business affairs and provide the Fund with administrative services, fund accounting and transfer agency services, including all regulatory reporting and necessary office equipment and personnel. The Adviser paid all administrative, transfer agency and fund accounting fees on behalf of the Fund per the Agreement. Certain Trustees and the officers of the Trust are members of management and employees of Unified, and/or shareholders of Unified Financial Services, Inc. Unified Financial Securities, Inc. (the "Distributor") acts as the principal distributor of the Fund's shares. There were no payments made by the Fund to the Distributor during the fiscal year ended December 31, 2003. A Trustee and certain officers of the Trust are a director and/or officers of the Distributor and of Unified Financial Services, Inc. (the parent company of the Distributor and Unified), and may be deemed to be affiliates of the Distributor. NOTE 4. INVESTMENTS For the fiscal year ended December 31, 2003, purchases and sales of investment securities, other than short-term investments and U.S. government obligations were as follows: Amount ------------------ Purchases U.S. Government Obligations $ 260,613,293 Other 17,046,406 Sales U.S. Government Obligations $ 181,351,035 Other 561,119 As of December 31, 2003, the net unrealized appreciation of investments for tax purposes was as follows: Amount --------------- Gross Appreciation $ 207,508 Gross (Depreciation) (347,968) --------------- Net Depreciation on Investments $ (140,460) =============== At December 31, 2003, the aggregate cost of securities for federal income tax purposes was $160,294,812. Institutional Short-Term Government Bond Fund (The Core Fund) Notes to Financial Statements December 31, 2003 - continued NOTE 5. ESTIMATES Preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. NOTE 6. RELATED PARTY TRANSACTIONS The beneficial ownership, either directly or indirectly, of 25% or more of the voting securities of a fund creates a presumption of control of the fund, under Section 2(a)(9) of the Investment Company Act of 1940. As of December 31, 2003, no shareholder held over 25% of the Fund's shares. NOTE 7. CAPITAL LOSS CARRYFORWARDS At December 31, 2003, the Fund had available for federal income tax purposes an unused capital loss carryforward of $848,930, which is available for offset against future taxable net capital gains. The loss carryforwards expire as follow: Year of Expiration Amount ------------------------- --------------- 2010 $ 122,929 2011 726,001 To the extent this loss carryforward is used to offset future capital gains, it is probable that the amount offset will not be distributed to shareholders. NOTE 8. DISTRIBUTIONS TO SHAREHOLDERS The Fund paid monthly distributions of net investment income totaling $0.2124 per share for the fiscal year ended December 31, 2003. The tax character of distributions paid in 2003 and 2002 was as follows: 2003 2002 Distributions paid from: Ordinary Income $ 2,204,943 $ 1,329,784 Short-term Capital Gain - - Long-Term Capital Gain - - --------------- ---------------- $ 2,204,943 $ 1,329,784 =============== ================ As of December 31, 2003, the components of distributable earnings / (accumulated losses) on a tax basis were as follows: Undistributed ordinary income/(accumulated losses) $ - Undistributed long-term capital gain/(accumulated losses) (848,930) Unrealized appreciation/(depreciation) (418,925) -------------- $(1,267,855) =============== The difference between book basis and tax basis unrealized appreciation / (depreciation) is attributable to the tax deferral of post-October losses. INDEPENDENT AUDITOR'S REPORT ---------------------------- To The Shareholders and Board of Trustees Institutional Short-Term Government Bond Fund (The Core Fund) (a series of AmeriPrime Advisor Trust) We have audited the accompanying statement of assets and liabilities of Institutional Short-Term Government Bond Fund, including the schedule of investments, as of December 31, 2003, and the related statement of operations for the year then ended, the statements of changes in net assets for the year then ended and for the period from January 9, 2002 (commencement of operations) to December 31, 2002, and the financial highlights for the periods indicated. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of investments and cash held as of December 31, 2003 by correspondence with the custodian. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Institutional Short-Term Government Bond Fund as of December 31, 2003, the results of its operations for the year then ended, the changes in its net assets for the year then ended and for the period from January 9, 2002 (commencement of operations) to December 31, 2002, and the financial highlights for the periods indicated, in conformity with accounting principles generally accepted in the United States of America. /s/ _______________________________ McCurdy & Associates CPA's, Inc. Westlake, Ohio January 22, 2004 Trustees and Officers (Unaudited) Independent Trustees ----------------------------------------------------- ---------------------------------------------------------------- Name, Address*, (Date of Birth), Position with Fund Principal Occupation During Past 5 Years and Other Complex,** Term of Position with Trust Directorships ----------------------------------------------------- ---------------------------------------------------------------- ----------------------------------------------------- ---------------------------------------------------------------- Gary E. Hippenstiel (1947) Director, Vice President and Chief Investment Officer of Legacy Trust Company, N.A. since 1992. Trustee of AmeriPrime Trustee, July 2002 to present Funds since 1995 and Unified Series Trust since December 2002. Trustee of CCMI Funds since June 2003. ----------------------------------------------------- ---------------------------------------------------------------- ----------------------------------------------------- ---------------------------------------------------------------- Stephen A. Little (1946) President and founder, The Rose, Inc., a registered investment advisor, since April 1993. Trustee of AmeriPrime Funds and Trustee, November 2002 to present Unified Series Trust since December 2002. Trustee of CCMI Funds since June 2003. ----------------------------------------------------- ---------------------------------------------------------------- ----------------------------------------------------- ---------------------------------------------------------------- Daniel J. Condon (1950) Vice President and General Manager, International Crankshaft Inc., an automotive equipment manufacturing company, 1990 to Trustee, November 2002 to present present; Trustee, The Unified Funds, from 1994 to 2002; Trustee, Star Select Funds, a REIT mutual fund, from 1997 to 2000. Trustee of AmeriPrime Funds and Unified Series Trust since December 2002. Trustee of CCMI Funds since June 2003. ----------------------------------------------------- ---------------------------------------------------------------- Interested Trustees and Principal Officers ------------------------------------------------ --------------------------------------------------------------------- Name, (Date of Birth), Position with Fund Principal Occupation During Past 5 Years Complex,** Term of Position with Trust and Other Directorships ------------------------------------------------ --------------------------------------------------------------------- ------------------------------------------------ --------------------------------------------------------------------- Timothy L. Ashburn (1950)*** Chairman of Unified Financial Services, Inc. since 1989, Chief Executive Officer from 1989 to 1992 and 1994 to April 2002, and Chairman, President, November 2002 to present President from November 1997 to April 2000. Trustee of AmeriPrime and Asst. Secretary, December 2003 to present Funds and Unified Series Trust since October 2002. Trustee of CCMI Funds since June 2003. ------------------------------------------------ --------------------------------------------------------------------- ------------------------------------------------ --------------------------------------------------------------------- Ronald C. Tritschler (1952)**** Chief Executive Officer, Director and legal counsel of The Webb Companies, a national real estate company, from 2001 to present; Trustee, November 2002 to present Executive Vice President and Director of The Webb Companies from 1990 to 2000; Director, The Lexington Bank, from 1998 to present; Director, Vice President and legal counsel for The Traxx Companies, an owner and operator of convenience stores, from 1989 to present. Trustee of AmeriPrime Funds and Unified Series Trust since December 2002. Trustee of CCMI Funds since June 2003. ------------------------------------------------ --------------------------------------------------------------------- ------------------------------------------------ --------------------------------------------------------------------- Thomas G. Napurano (1941) Chief Financial Officer and Executive Vice President of Unified Financial Services, Inc., the parent company of the Trust's Chief Financial Officer and Treasurer, October administrator and Distributor; Director, Unified Financial 2002 to present Services, Inc., from 1989 to March 2002. CFO of AmeriPrime Funds since October 2002 and Unified Series Trust since December 2002. CFO of CCMI Funds since June 2003. ------------------------------------------------ --------------------------------------------------------------------- ------------------------------------------------ --------------------------------------------------------------------- Carol Highsmith (1964) Employed by Unified Fund Services, Inc. (November 1994 to present). Secretary of AmeriPrime Funds and Unified Series Trust since Secretary, December 2003 to present December 2003. ------------------------------------------------ --------------------------------------------------------------------- * The address for each of the trustees and officers is 431 N. Pennslyvania, Indianapolis, IN 46204. ** Fund Complex refers to AmeriPrime Advisors Trust, AmeriPrime Funds and Unified Series Trust. The Fund Complex consists of 29 series. *** Mr. Ashburn is an "interested person" of the Trust because he is an officer of the Trust. In addition, he may be deemed to be an "interested person" of the Trust because he is Chairman and a director of Unified Financial Securities, Inc., the Distributor of certain series in the Fund Complex. **** Mr. Tritschler may be deemed to be an "interested person" of the Trust because he has an ownership interest in Unified Financial Services, Inc., the parent of the Distributor of certain series in the Fund Complex.
The Fund's Statement of Additional Information ("SAI") includes additional information about the trustees and is available, without charge, upon request. You may call toll-free (877) 411-1167 to request a copy of the SAI or to make shareholder inquiries. PROXY VOTING A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge upon request by calling the Fund at (877) 411-1167. TRUSTEES Timothy L. Ashburn, Chairman Gary E. Hippenstiel Stephen A. Little Daniel J. Condon Ronald C. Tritschler OFFICERS Timothy L. Ashburn, President and Asst. Secretary Thomas G. Napurano, Chief Financial Officer and Treasurer Carol J. Highsmith, Secretary INVESTMENT ADVISOR Wertz York Capital Management Group, LLC. 3434 Colwell Ave, Suite 100 Tampa, FL 33614 DISTRIBUTOR Unified Financial Securities, Inc. 431 N. Pennsylvania Street Indianapolis, Indiana 46204 INDEPENDENT ACCOUNTANTS McCurdy & Associates CPA's, Inc. 27955 Clemens Rd. Westlake, OH 44145 LEGAL COUNSEL Thompson Hine, LLP 312 Walnut St., Suite 1400 Cincinnati, OH 45202 CUSTODIAN Huntington National Bank 41 South Street Columbus, OH 43125 ADMINISTRATOR, TRANSFER AGENT AND FUND ACCOUNTANT Unified Fund Services, Inc. 431 N. Pennsylvania Street Indianapolis, Indiana 46204 This report is intended only for the information of shareholders or those who have received the Fund's prospectus which contains information about the Fund's management fee and expenses. Please read the prospectus carefully before investing. Distributed by Unified Financial Securities, Inc. Member NASD/SIPC Item 2. Code of Ethics. (a) As of the end of the period covered by this report, the registrant has adopted a code of ethics that applies to the registrant's 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. (b) For purposes of this item, "code of ethics" means written standards that are reasonably designed to deter wrongdoing and to promote: (1) Honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships; (2) Full, fair, accurate, timely, and understandable disclosure in reports and documents that a registrant files with, or submits to, the Commission and in other public communications made by the registrant; (3) Compliance with applicable governmental laws, rules, and regulations; (4) The prompt internal reporting of violations of the code to an appropriate person or persons identified in the code; and (5) Accountability for adherence to the code. (c) Amendments: During the period covered by the report, there have not been any amendments to the provisions of the code of ethics. (d) Waivers: During the period covered by the report, the registrant has not granted any express or implicit waivers from the provisions of the code of ethics. Item 3. Audit Committee Financial Expert. (a) The registrant's Board of Trustees has determined that the registrant does not have an audit committee financial expert. The committee members and the full Board considered the possibility of adding a member that would qualify as an expert. The audit committee determined that, although none of its members meet the technical definition of an audit committee financial expert, the committee has sufficient financial expertise to adequately perform its duties under the Audit Committee Charter without the addition of a qualified expert. Item 4. Principal Accountant Fees and Services. (a) Audit Fees FY 2003 $ 14,687 FY 2002 $ 10,903 (b) Audit-Related Fees Registrant Adviser FY 2003 $ 0 $ 0 FY 2002 $ 0 $ 0 Nature of the fees: (c) Tax Fees Registrant Adviser FY 2003 $ 650 $ 0 FY 2002 $ 550 $ 0 Nature of the fees: preparation of tax return considered non-audit (d) All Other Fees Registrant Adviser FY 2003 $ 0 $ 0 FY 2002 $ 0 $ 0 Nature of the fees: (e) (1) Audit Committee's Pre-Approval Policies To be responsible for the selection, retention or termination of auditors and, in connection therewith, to (i) evaluate the proposed fees and other compensation, if any, to be paid to the auditors, (ii) evaluate the independence of the auditors, (iii) pre-approve all audit services and, when appropriate, any non-audit services1 provided by the independent auditors to the Trust, (iv) pre-approve, when appropriate, any non-audit services provided by the independent auditors to the Trust's investment adviser,2 or any entity controlling, controlled by, or under common control with the investment adviser and that provides ongoing services to the Trust if the engagement relates directly to the operations and financial reporting of the Trust, and (v) receive the auditors' specific representations as to their independence; (2) Percentages of Services Approved by the Audit Committee Registrant Adviser Audit-Related Fees: 0 % N/A % Tax Fees: 100 % N/A % All Other Fees: 0 % N/A % (f) During audit of registrant's financial statements for the most recent fiscal year, less than 50 percent of the hours expended on the principal accountant's engagement were attributed to work performed by persons other than the principal accountant's full-time, permanent employees. (g) The aggregate non-audit fees billed by the registrant's accountant for services rendered to the registrant, and rendered to the registrant's 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: Registrant Adviser FY 2003 $ 0 $ 0 FY 2002 $ 0 $ 0 (h) N/A - All non-audit services were pre-approved. Item 5. Audit Committee of Listed Companies. Not applicable. Item 6. Reserved. Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Funds. Not applicable. Item 8. Purchases of Equity Securities by Closed-End Funds. Not applicable. Item 9. Submission of Matters to a Vote of Security Holders. Not applicable. Item 10. Controls and Procedures. (a) Based on an evaluation of the registrant's disclosure controls and procedures as of January 9, 2004, the disclosure controls and procedures are reasonably designed to ensure that the information required in filings on Forms N-CSR is recorded, processed, summarized, and reported on a timely basis. (b) There were no significant changes in the registrant's internal control over financial reporting that occurred during the registrant's last fiscal half-year that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting. Item 11. Exhibits. (a)(1) Code is filed herewith. (a)(2) Certifications by the registrant's principal executive officer and principal financial officer, pursuant to Section 302 of the Sarbanes- Oxley Act of 2002 and required by Rule 30a-2under the Investment Company Act of 1940 are filed herewith. (a)(3) Not applicable. (b) Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 is filed herewith. 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) Ameriprime Advisors Trust By /s/ Timothy Ashburn Timothy Ashburn, President Date March 10, 2004 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. By /s/ Timothy Ashburn Timothy Ashburn, President Date March 10, 2004 By (Signature and Title) /s/ Thomas G. Napurano Thomas G. Napurano, Treasurer and Chief Financial Officer Date February 26, 2004