-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, ODcdv++nPLAeCRr5JDiQT6Cv2qHV8K9jYlhdWg6U+y5tXPIDZehbSA645xOFdOHT nVdhFMzCJuTK2h9REu/IxQ== 0000898531-01-000060.txt : 20010212 0000898531-01-000060.hdr.sgml : 20010212 ACCESSION NUMBER: 0000898531-01-000060 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20001130 FILED AS OF DATE: 20010209 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ALLIED ASSET ADVISORS FUNDS CENTRAL INDEX KEY: 0001105877 STANDARD INDUSTRIAL CLASSIFICATION: [] STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-30D SEC ACT: SEC FILE NUMBER: 811-09821 FILM NUMBER: 1530931 BUSINESS ADDRESS: STREET 1: C/O FIRSTAR MUTUAL FUND SERVICES LLC STREET 2: P O BOX 701 CITY: MILWAUKEE STATE: WI ZIP: 532010701 BUSINESS PHONE: 6207899191 MAIL ADDRESS: STREET 1: C/O FIRSTAR MUTUAL FUND SERVICES LLC STREET 2: P O BOX 701 CITY: MILWAUKEE STATE: WI ZIP: 532010701 FORMER COMPANY: FORMER CONFORMED NAME: AAA FUNDS DATE OF NAME CHANGE: 20000209 N-30D 1 0001.txt DOW JONESSM ISLAMIC INDEX FUND SEMI-ANNUAL REPORT NOVEMBER 30, 2000 (UNAUDITED) ALLIED ASSET ADVISORS FUNDS Dow Jones Islamic Index Fund Semi-Annual Report Dear Shareholders: Assalamu Alaykum The last five months proved unkind to stock investors in the United States and even abroad. Several broad indexes declined double digits. The Standard & Poor's 500 Index declined 9.2%* from June 30, 2000-November 30, 2000, while the Russell 2000 declined 13.3%*. The NASDAQ Composite index lost 34.4%*. The Dow Jones Islamic Market USA Index went down 15.1%*. Your index fund declined 15.8%, thus tracking the index relatively well. The Federal Reserve increased interest rates to slow down the economy and indeed succeeded in doing that. GDP declined from over 8 percent in late 1999 to close to zero in the beginning of 2001, as indicated by the Fed's chairman. This resulted in a decline in stock prices, especially affecting growth and technology stocks, which are well represented in our index. This is the first calendar year in ten years that broad indexes declined. Also, this is the first time in ten years that bonds outperformed stocks. Thus, this was not a typical year in stock investing. It is a year that corrected many excesses in the stock market. Long-term investors benefit from a "buy and hold" strategy and not a "timing of the market" strategy. There is a saying on Wall Street that "it is time in the market, not timing the market". Most market timers exit too early or too late and then miss the upward movement in the market or a portion of it. Thus, they may end in a lesser return than a buy and hold strategy that persevere through market decline. Investing in the Dow Jones Islamic Index Fund provides diversification, convenience, relatively low cost, tax efficiency and adherence to Islamic principles. In closing, I want to thank you for your trust and confidence in the Dow Jones Islamic Index Fund. Respectfully, /s/Bassam Osman Dr. Bassam Osman President * Obtained from Bloomberg Services on November 30, 2000. DOW JONES ISLAMIC INDEX FUND SCHEDULE OF INVESTMENTS November 30, 2000 (Unaudited) NUMBER OF MARKET SHARES VALUE - --------- ------ COMMON STOCK - 99.7% AEROSPACE & AIRCRAFT - 0.7% 1,700 United Technologies Corporation $ 120,381 ----------- AUTOMOBILE & TRUCK PARTS - 0.3% 2,000 Delphi Automotive Systems Corporation 27,625 600 Genuine Parts Company 11,513 600 The Goodyear Tire & Rubber Company 10,170 ----------- 49,308 ----------- BUILDING & HOUSING - 0.0% 300 The Stanley Works 8,081 ----------- BUSINESS SERVICES - 1.0% 500 Cintas Corporation 25,469 500 Convergys Corporation * 21,031 500 Ecolab, Inc. 21,719 500 Moody's Corporation 12,969 1,200 Paychex, Inc. 69,750 500 Quintiles Transnational Corporation * 7,500 500 Robert Half International, Inc. * 14,937 ----------- 173,375 ----------- CHEMICALS - 1.5% 2,400 The Dow Chemical Company 73,350 3,800 E. I. du Pont de Nemours and Company 160,787 500 Engelhard Corporation 9,844 600 PPG Industries, Inc. 25,012 ----------- 268,993 ----------- COMPUTERS - 5.5 % 6,200 Compaq Computer Corporation 133,300 9,400 Dell Computer Corporation * 180,950 1,200 Gateway, Inc. * 22,800 7,400 Hewlett-Packard Company 234,025 5,800 Sun Microsystems, Inc. * 441,163 ----------- 1,012,238 ----------- COMPUTER SERVICES - 4.0% 600 Computer Sciences Corporation * 40,912 7,500 EMC Corporation * 557,812 1,700 Electronic Data Systems Corporation 89,994 500 SunGard Data Systems, Inc. * 24,531 1,100 Unisys Corporation * 13,406 ----------- 726,655 ----------- COMPUTER SOFTWARE - 3.4% 900 BMC Software, Inc. * 15,581 1,100 Cadence Design Systems, Inc. * 25,781 1,200 Novell, Inc. * 6,375 20,600 Oracle Corporation * 545,900 1,000 PeopleSoft, Inc. * 33,250 ----------- 626,887 ----------- CONSUMER PRODUCTS - 0.4% 700 Leggett & Platt, Inc. 11,419 1,100 Newell Rubbermaid, Inc. 21,381 1,100 NIKE, Inc. Class B 46,887 ----------- 79,687 ----------- COSMETICS & TOILETRIES - 2.7% 2,000 Kimberly-Clark Corporation 139,875 4,800 The Procter & Gamble Company 359,400 ----------- 499,275 ----------- ELECTRICAL EQUIPMENT - 0.7% 700 American Power Conversion Corporation * 8,225 1,600 Emerson Electric Company 116,600 ----------- 124,825 ----------- ELECTRONICS & SEMICONDUCTORS - 8.8% 1,300 Altera Corporation * 31,119 2,900 Applied Materials, Inc. * 117,269 500 Broadcom Corporation * 48,750 24,400 Intel Corporation 928,725 1,000 Maxim Integrated Products, Inc. * 51,000 1,900 Micron Technology, Inc. 59,850 2,000 Palm, Inc. * 72,375 2,200 Solectron Corporation * 61,600 500 Symbol Technologies, Inc. 20,031 6,000 Texas Instruments, Inc. 223,875 ----------- 1,614,594 ----------- ENERGY - 2.1% 500 Ameren Corporation 22,188 1,300 Duke Energy Corporation 116,919 2,600 Enron Corporation 168,350 600 FPL Group, Inc. 39,750 500 KeySpan Corporation 19,063 700 Sempra Energy 17,106 ----------- 383,376 ----------- FOOD & BEVERAGE - 3.3% 2,310 Archer-Daniels-Midland Company 29,453 9,000 The Coca-Cola Company 563,625 ----------- 593,078 ----------- HEALTHCARE PRODUCTS - 5.3% 1,100 Applera Corporation - Applied Biosystems Group 90,888 600 Biomet, Inc. 22,200 1,100 Cardinal Health, Inc. 109,931 5,100 Johnson & Johnson 510,000 4,400 Medtronic, Inc. 234,300 ----------- 967,319 ----------- HEALTHCARE SERVICES - 0.9% 1,100 Health Management Associates, Inc. * 23,444 1,100 IMS Health, Inc. 30,800 1,100 McKesson HBOC, Inc. 36,162 55 SYNAVANT, Inc. * 213 600 UnitedHealth Group, Inc. 70,388 ----------- 161,007 ----------- MACHINERY & EQUIPMENT - 0.5% 700 Dover Corporation 28,656 500 Ingersoll-Rand Company 20,125 500 Pall Corporation 9,969 700 Rockwell International Corporation 28,175 ----------- 86,925 ----------- MANUFACTURING - 3.8% 2,900 Honeywell International, Inc. 141,375 1,100 Illinois Tool Works, Inc. 61,944 1,500 Minnesota Mining and Manufacturing Company 149,813 6,300 Tyco International, Ltd. 332,325 ----------- 685,457 ----------- METALS & MINING - 0.5% 3,200 Alcoa, Inc. 90,200 500 Bethlehem Steel Corporation * 1,125 500 USX-U.S. Steel Group 7,125 ----------- 98,450 ----------- NETWORKING PRODUCTS - 7.6% 25,000 Cisco Systems, Inc. * 1,196,875 11,600 Lucent Technologies, Inc. 180,525 1,200 3Com Corporation * 14,700 ----------- 1,392,100 ----------- OFFICE EQUIPMENT - 0.2% 500 Avery Dennison Corporation 27,500 300 Herman Miller, Inc. 7,088 ----------- 34,588 ----------- OIL & GAS EXPLORATION - 0.5% 500 ENSCO International, Inc. 12,156 500 Nabors Industries, Inc. * 21,970 500 Noble Drilling Corporation * 14,406 1,100 Transocean Sedco Forex, Inc. 43,862 ----------- 92,394 ----------- OIL & GAS INTERNATIONAL - 8.3% 2,400 Chevron Corporation 196,500 12,600 Exxon Mobil Corporation 1,108,800 1,000 Phillips Petroleum Company 56,500 2,000 Texaco, Inc. 116,125 1,100 USX-Marathon Group 29,012 ----------- 1,506,937 ----------- OIL & GAS SERVICES - 1.1% 1,600 Halliburton Company 53,400 2,000 Schlumberger Limited 124,000 500 Tosco Corporation 14,344 ----------- 191,744 ----------- PAPER & RELATED PRODUCTS - 0.4% 1,800 International Paper Company 60,975 500 Louisiana-Pacific Corporation 3,531 ----------- 64,506 ----------- PHARMACEUTICALS - 20.8% 5,600 Abbott Laboratories 308,350 4,800 American Home Products Corporation 288,600 3,700 Amgen, Inc. * 235,413 7,200 Bristol-Myers Squibb Company 499,050 4,000 Eli Lilly and Company 374,750 8,500 Merck & Company, Inc. 787,844 22,700 Pfizer, Inc. 1,005,894 5,400 Schering-Plough Corporation 302,738 ----------- 3,802,639 ----------- PUBLISHING - 0.1% 500 The New York Times Company 17,656 ----------- RAILROAD - 0.5% 1,700 Burlington Northern Santa Fe Corporation 43,031 1,100 Union Pacific Corporation 51,150 ----------- 94,181 ----------- RETAIL STORES - 5.1% 1,000 Bed Bath & Beyond, Inc. * 20,813 1,400 CVS Corporation 79,625 700 Circuit City Stores-Circuit City Group 8,881 500 Consolidated Stores Corporation * 4,281 3,100 The Gap, Inc. 77,306 8,400 The Home Depot, Inc. 329,175 1,200 Kohl's Corporation * 64,275 1,600 The Limited, Inc. 31,100 1,400 Lowe's Companies, Inc. 56,087 500 Nordstrom, Inc. 8,031 1,200 Office Depot, Inc. * 7,950 700 RadioShack Corporation 32,813 1,700 Staples, Inc. * 20,400 700 Starbucks Corporation * 31,894 1,100 The TJX Companies, Inc. 28,187 3,200 Target Corporation 96,200 500 Tiffany & Company 17,094 1,100 Toys "R" Us, Inc. * 20,831 ----------- 934,943 ----------- TELECOMMUNICATIONS - 6.5% 13,900 AT&T Corporation 272,787 966 Avaya, Inc. * 11,290 12,400 SBC Communications, Inc. 681,225 2,900 Sprint Corporation 66,700 10,400 WorldCom, Inc. * 155,350 ----------- 1,187,352 ----------- TELECOMMUNICATIONS EQUIPMENT - 2.9% 3,300 Corning, Inc. 193,050 2,300 JDS Uniphase Corporation * 115,144 7,800 Motorola, Inc. 156,488 1,300 Tellabs, Inc. * 68,900 ----------- 533,582 ----------- TRANSPORTATION - 0.3% 1,100 FedEx Corporation * 52,712 ----------- Total Common Stock (Cost $21,240,549) 18,185,245 ----------- Assets, Less Other Liabilities - 0.3% 58,010 ----------- TOTAL NET ASSETS 100.0% $18,243,255 ----------- ----------- * Non Income Producing See notes to the financial statements DOW JONES ISLAMIC INDEX FUND STATEMENT OF ASSETS AND LIABILITIES November 30, 2000 (Unaudited) ASSETS Investments in securities, at market (cost: $21,240,549) $18,185,245 Cash 125,973 Dividends receivable 24,966 Receivable from Advisor 30,700 Other assets 19,925 ----------- TOTAL ASSETS 18,386,809 ----------- LIABILITIES Payable for securities purchased 19,499 Accrued expenses 85,682 Other payables 38,373 ----------- TOTAL LIABILITIES 143,554 ----------- NET ASSETS $18,243,255 ----------- ----------- NET ASSETS REPRESENTED BY: Paid in capital $21,422,893 Undistributed net investment income 6,261 Accumulated net realized loss on investments (130,595) Unrealized depreciation on investments (3,055,304) ----------- NET ASSETS $18,243,255 ----------- Shares of capital stock outstanding; unlimited number of shares authorized, no par value 2,142,846 ----------- NET ASSET VALUE, REDEMPTION AND OFFERING PRICE PER SHARE $ 8.51 ----------- ----------- See notes to the financial statements DOW JONES ISLAMIC INDEX FUND STATEMENT OF OPERATIONS (Unaudited) FOR THE PERIOD JUNE 29, 2000 (1) TO NOVEMBER 30, 2000 -------------------- NET INVESTMENT INCOME INCOME: Dividends $ 82,761 ----------- TOTAL INCOME 82,761 ----------- EXPENSES: Investment advisory fees 63,750 Administration fees 16,170 Shareholder servicing and accounting fees and expenses 29,414 Custody fees 4,620 Federal and state registration fees 16,710 Professional fees 14,630 Reports to shareholders 4,158 Trustees' fees and expenses 1,694 Miscellaneous 12,396 ----------- TOTAL EXPENSES 163,542 Less fees reimbursed by Advisor (87,042) ----------- NET EXPENSES 76,500 ----------- NET INVESTMENT INCOME 6,261 ----------- NET REALIZED AND UNREALIZED GAINS (LOSSES) Net realized loss on investments (130,595) Net change in unrealized depreciation on investment securities (3,055,304) ----------- NET LOSS ON INVESTMENTS (3,185,899) ----------- NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS $(3,179,638) ----------- ----------- (1) Commencement of operations. See notes to the financial statements DOW JONES ISLAMIC INDEX FUND STATEMENT OF CHANGES IN NET ASSETS FOR THE PERIOD JUNE 29, 2000 (1) TO NOVEMBER 30, 2000 (UNAUDITED) -------------------- OPERATIONS Net investment income $ 6,261 Net realized loss on investments (130,595) Net change in unrealized depreciation on investments (3,055,304) ----------- NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS (3,179,638) ----------- CAPITAL SHARE TRANSACTIONS (NOTE 4) Shares sold 21,322,988 Shares redeemed (95) ----------- INCREASE IN NET ASSETS FROM CAPITAL SHARES TRANSACTIONS 21,322,893 ----------- TOTAL INCREASE IN NET ASSETS 18,143,255 NET ASSETS AT BEGINNING OF PERIOD 100,000 ----------- NET ASSETS AT END OF PERIOD $18,243,255 ----------- ----------- (1) Commencement of operations. See notes to the financial statements DOW JONES ISLAMIC INDEX FUND FINANCIAL HIGHLIGHTS Selected data for each share of capital stock outstanding FOR THE PERIOD JUNE 29, 2000 (1) TO NOVEMBER 30, 2000 (UNAUDITED) -------------------- CLASS K ------- NET ASSET VALUE Beginning of period $10.00 ------ OPERATIONS Net investment income 0.00 Net realized and unrealized losses (1.49) ------ TOTAL FROM OPERATIONS (1.49) ------ NET ASSET VALUE End of period $ 8.51 ------ ------ Total investment return (15.83)%(2) (5) Net assets, end of period (000's omitted) $18,243 RATIOS Expenses to average net assets (3) 0.90%(4) Net investment income to average net assets (3) 0.07%(4) Portfolio turnover rate (excluding short-term securities) 5.0% (1) Commencement of operations. (2) Not annualized. (3) Without fees waived, the ratio of expenses to average net assets would have been 1.92% and the ratio of net investment income would have been (.95)% for the period ended November 30, 2000. (4) Annualized. (5) The investment return was calculated using the date the Fund became effective with the SEC, June 30, 2000. See notes to the financial statements DOW JONES ISLAMIC INDEX FUND NOTES TO THE FINANCIAL STATEMENTS November 30, 2000 (Unaudited) 1. ORGANIZATION Allied Asset Advisors Funds (the "Trust"), an open-end management investment company, was organized as a Delaware business trust. The Trust currently offers one series of shares to investors, the Dow JonesSM Islamic Index Fund (the "Fund") which consists of two classes: Class K and M. Class M did not have any assets as of November 30, 2000. The Fund is a diversified series of the Trust and has its own investment objective and policies. The Trust may start another series and offer shares of a new fund under the Trust at any time. Allied Asset Advisors, Inc. ("AAA"or the "Advisor") is a Delaware corporation serves as an investment manager to the Fund. AAA is a wholly owned subsidiary of the North American Islamic Trust. 2. SIGNIFICANT ACCOUNTING POLICIES The following is a summary of significant accounting policies consistently followed by the Fund in the preparation of its financial statements. These policies are in conformity with accounting principles generally accepted in the United States of America ("GAAP"). USE OF ESTIMATES: In preparing the financial statements in conformity with accounting principles generally accepted in the United States of America, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from these estimates. VALUATION OF INVESTMENTS: Investment securities are carried at value determined using the following valuation methods: O Securities listed on a U.S. securities exchange or NASDAQ for which market quotations are readily available are valued at the last quoted sale price on the day the valuation is made. O Options, futures, unlisted U.S. securities and listed U.S. securities not traded on the valuation date for which market quotations are readily available are valued at the most recent quoted bid price. The Fund did not hold any such securities during the period. O Securities or other assets for which market quotations are not readily available are valued at fair value as determined in good faith or under direction of the Board of Directors. Determination of fair value involves, among other things, reference to market indices, matrices and data from independent brokers and pricing services. The Fund did not hold any such securities during the period. DISTRIBUTIONS TO SHAREHOLDERS: The Fund will distribute substantially all of the net investment and net capital gains that it has realized on the sale of securities. These income and gains distributions will generally be paid once each year, on or before December 31. FEDERAL INCOME TAXES: It is the Portfolio's policy to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and the Portfolio intends to distribute investment company net taxable income and net capital gains to shareholders. Therefore, no federal income tax provision is required. OTHER: Security and shareholder transactions are recorded on trade date. Realized gains and losses on sales of investments are calculated on the identified cost basis. Dividend income and dividends and distributions to shareholders are recorded on the ex-dividend date. Generally accepted accounting principles require that permanent financial reporting and tax differences relating to shareholder distributions be reclassified to paid in capital. 3. INVESTMENT ADVISORY AGREEMENT The Trust has an Investment Advisory Agreement (the "Agreement") with the Advisor, with whom certain officers and Trustees of the Trust are affiliated, to furnish investment advisory services to the Fund. Under the terms of the Agreement, the Trust, on behalf of the Fund, compensates the Advisor for its management services at the annual rate of 0.75% of the Fund's average net assets. If the aggregate annual operating expenses exceed 0.90% of net assets for Class K shares, the Advisor will waive or reimburse the Fund for the amount of such excess. Accordingly, for the period ended November 30, 2000, the Advisor has waived expenses of the Fund in the amount of $87,042. 4. CAPITAL SHARE TRANSACTIONS Transactions in Class K shares of the Fund for the period ended November 30, 2000, were as follows: Shares sold 2,132,856 Shares redeemed (10) --------- Net increase 2,132,846 --------- --------- 5. SECURITIES TRANSACTIONS Purchases and sales of investment securities, other than short-term investments, for the period ended November 30, 2000 were as follows: Purchases: Other $22,209,388 Sales: Other $838,244 At November 30, 2000, unrealized appreciation and depreciation for federal income tax purposes was as follows: Appreciation $ 1,216,559 Depreciation (4,271,863) ----------- Net depreciation on investments $(3,055,304) ----------- ----------- At November 30, 2000, the cost of investment securities for income tax purposes was $21,240,549. INVESTMENT ADVISOR AAA Allied Asset Advisors, Inc. Burr Ridge, Illinois DISTRIBUTOR Rafferty Capital Markets, Inc. White Plains, New York INDEPENDENT AUDITORS Deloitte & Touche LLP Chicago, Illinois LEGAL COUNSEL Vedder, Price, Kaufman, & Kammholz Chicago, Illinois ADMINISTRATOR, TRANSFER AGENT, AND FUND ACCOUNTANT Firstar Mutual Fund Services, LLC Milwaukee, Wisconsin CUSTODIAN Firstar Bank, N.A. Cincinnati, Ohio -----END PRIVACY-ENHANCED MESSAGE-----