-----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, HKKxU9Jjjks9jsA86pVE05neALW0TVCnwudVCnY/8g+H8wRu1WawEKoiV7eWomSt 2zfIDL5Ujk5cONMTDnDw2Q== 0000894189-06-001929.txt : 20060814 0000894189-06-001929.hdr.sgml : 20060814 20060814123415 ACCESSION NUMBER: 0000894189-06-001929 CONFORMED SUBMISSION TYPE: N-CSRS PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 20060630 FILED AS OF DATE: 20060814 DATE AS OF CHANGE: 20060814 EFFECTIVENESS DATE: 20060814 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BRIDGES INVESTMENT FUND INC CENTRAL INDEX KEY: 0000014170 IRS NUMBER: 476027880 STATE OF INCORPORATION: NE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-CSRS SEC ACT: 1940 Act SEC FILE NUMBER: 811-01209 FILM NUMBER: 061028270 BUSINESS ADDRESS: STREET 1: 8401 W DODGE RD STREET 2: SUITE 256 CITY: OMAHA STATE: NE ZIP: 68114 BUSINESS PHONE: 4023974700 MAIL ADDRESS: STREET 1: 8401 WEST DODGE ROAD STREET 2: SUITE 256 CITY: OMAHA STATE: NE ZIP: 68114 0000014170 S000006176 Bridges Investment Fund, Inc. C000017015 Bridges Investment Fund, Inc. BRGIX N-CSRS 1 bridges_ncsrs.htm SEMI-ANNUAL CERTIFIED SHAREHOLDER REPORT Semi-Annual Certified Shareholder Report

As filed with the Securities and Exchange Commission on August 14, 2006
 

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 811-1209



Bridges Investment Fund, Inc.
(Exact name of registrant as specified in charter)



8401 West Dodge Road, Suite 256
Omaha, NE 68114 
(Address of principal executive offices) (Zip code)



Edson L. Bridges III
8401 West Dodge Road, Suite 256
Omaha, NE 68114 
(Name and address of agent for service)



(402) 397-4700
Registrant's telephone number, including area code



Date of fiscal year end: December 31



Date of reporting period: January 1, 2006 - June 30, 2006

 

 
Item 1. Report to Stockholders.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 





Second Quarter
 
Shareholder Report
 
2006

 
 
 
 
 
 
 

 
 
 

 
8401 West Dodge Road - 256 Durham Plaza - Omaha, Nebraska 68114 - voice: (402) 397-4700 fax: (402) 397-8617 - www.bridgesfund.com
 
 
 
 
 





Contents of Report

 
 
   
Pages 2-4
Shareholder Letter
   
Exhibit 1
Portfolio Transactions During the Period From April 1, 2006
Pages 5-6
through June 30, 2006
   
Exhibit 2
Historical Financial Information
Pages 7-8
 
   
Pages 9-10
Expense Example
   
Page 11
Allocation of Portfolio Holdings
   
Pages 12-25
Unaudited Financial Statements for the Six Months Ended
 
June 30, 2006
 
 
IMPORTANT NOTICES
 
 
Opinions expressed herein are those of Edson L. Bridges III and are subject to change. They are not guarantees and should not be considered investment advice.
The S&P 500 Index is a broadly based unmanaged composite of 500 stocks which is widely recognized as representative of price changes for the U.S. equity market in general. The Russell 1000 Growth Index is an unmanaged composite of stocks that measures the performance of the stocks of companies with higher price-to-book ratios and higher forecasted growth values from a universe of the 1,000 largest U.S. companies based on total market capitalization. The Russell 1000 Value Index is an unmanaged composite of stocks that measures the performance of the stocks of companies with lower price-to-book ratios and lower forecasted growth values from a universe of the 1,000 largest U.S. companies based on total market capitalization.
 
You cannot invest directly in a specific index, however, you may invest in a number of open end investment companies organized and operated by other sponsors for the purpose of experiencing the investment results for an index. Fund holdings are subject to change and should not be considered a recommendation to buy or sell any security. Please refer to the Schedule of Investments for complete information on holdings in the Fund.
 
Mutual fund investing involves risk. Principal loss is possible. Small- and medium-capitalization companies tend to have limited liquidity and greater price volatility than large-capitalization companies. Investments in debt securities typically decrease in value when interest rates rise. This risk is usually greater for longer-term debt securities. Growth stocks typically are more volatile than value stocks; however, value stocks have a lower expected growth rate in earnings and sales.
 
The Price to Earnings (P/E) Ratio reflects the multiple of earnings at which a stock sells. Cash flow measures the cash generating capability of a company by adding non-cash charges (e.g. depreciation) and interest expense to pretax income. A basis point is a unit that is equal to 0.01% and is used to denote the change in a financial instrument.
 
This report has been prepared for the information of the shareholders of Bridges Investment Fund, Inc. and is under no circumstances to be construed as an offering of shares of the Fund. Such offering is made only by Prospectus.
 
This report must be preceded or accompanied by a Prospectus.
 
Quasar Distributors, LLC, Distributor (8/06)




 
 
Bridges Investment Fund, Inc.
 
 
256 DURHAM PLAZA
 
 
8401 WEST DODGE ROAD
 
 
OMAHA, NEBRASKA 68114 - 3453
 
     
 
TELEPHONE 402 - 397 - 4700
 
 
FACSIMILE 402 - 397 - 8617
 
 

July 14, 2006
Dear Shareholder,

    Bridges Investment Fund had a total return of -4.67% during the second quarter of 2006, versus returns of -1.44% for the S&P 500 and -3.90% for the Russell 1000 Growth Index. For the first two quarters of 2006, the Fund had a total return of -3.39% versus a 2.71% gain for the S&P 500 and a -0.93% return for the Russell 1000 Growth Index. For the 12 month period ending June 30, 2006, the Fund had a total return of 3.19%, versus 8.63% for the S&P 500 and 6.12% for the Russell 1000 Growth Index. For the five year period ending June 30, 2006, the Fund had an average annual total return of 0.82%, versus 2.49% for the S&P 500, and -0.76% for the Russell 1000 Growth Index. For the ten year period ending June 30, 2006, the Fund had an average annual total return of 6.21%, versus 8.32% for the S&P 500 and 5.42% for the Russell 1000 Growth Index.

    Performance data quoted represents past performance, and does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Performance current to the most recent month end may be lower or higher than the performance quoted and may be obtained by calling 866-934-4700.

    The first half of 2006 has been one of the most frustrating and difficult periods for the Fund in memory, which shows in its poor relative performance.

    The Fund ended 2005 with relatively strong performance, bettering the S&P 500 and Russell 1000 Growth by about 100 basis points for the fourth quarter (3.25% vs. 2.09% and 2.98%, respectively) and the year (5.99% vs. 4.91% and 5.26%, respectively). However, during the first half of 2006, the Fund’s relative performance has slipped markedly, primarily for three reasons: 1) we have allocated capital to companies that we believe are attractive longer term, but which have struggled in terms of stock price performance (despite good underlying financial performance) this year; 2) valuations for high quality growth companies have contracted markedly thus far this year; and 3) capital flows have gone to sectors where we have relatively less exposure, such as small and mid cap equities, non-U.S. domiciled companies, and companies with a relatively high degree of sensitivity to the pace of the economy. We discuss these factors in a little more detail below:
 
1)
We believe that health care and certain consumer companies represent the best combination of good long term growth prospects and solid valuation characteristics, and we have allocated more capital toward companies such as Amgen and Medtronic during the first half of 2006. Despite attractive valuations and reasonably good earnings performance, valuations in the health care and consumer sectors have contracted materially since December, hurting our performance thus far this year. Amgen and Medtronic currently trade at the lowest absolute and relative valuations they have experienced since the early 1990’s.

2)
The Fund has historically focused on investing in companies with strong business franchises, relatively consistent earnings and free cash flow growth, and strong balance sheets, as those types of companies provide shareholders with good returns over the long run because they build business value inexorably over time. However, the market’s appraisal of such companies can vary widely over the short run, depending on many factors, most of which have little to do with the long term prospects of the companies themselves. High quality growth companies saw their 2 valuations expand significantly in the late 1990’s, and contract markedly between late 2000 and March of 2003. Valuations recovered somewhat between March 2003 and the first half of 2005, but over the past 6 months, valuations have again been compressed notwithstanding generally good financial performance by our companies. While we have no way of knowing what the catalyst will be to cause valuations to revert back toward normal historical levels, history strongly suggests that mean reversion will happen at some point in the future.
 
 
2

 
3)
Fund flows in the first half of 2006 in the capital markets have been strongly toward smaller companies, foreign companies, and companies with a relatively high degree of sensitivity to changes in economic growth. While the Fund has some exposure to these areas, they are generally sectors of the market in which we have tended to be underweighted given our preference for companies with consistent earnings growth, free cash flow generation, and our valuation discipline. We believe that investors’ appetite for risk has increased appreciably in 2006, and this has resulted in large capital flows toward riskier segments of the market and is reflected in the continued outperformance of smaller, economically-sensitive, and international stocks despite their higher valuations and more volatile earnings growth profile.

    During the second quarter, the companies having the largest negative impact of the Fund’s performance were: Qualcomm (-$532,835, -20.90%), D. R. Horton (-$355,440, -24.18%), Zimmer (-$272,000, -16.09%), Home Depot (-$260,400, -15.05%), and eBay (-$242,750, -24.90%).

    While it is not fun to hold stocks that are declining in price, we are confident that the Fund’s common stock holdings have significant long term investment appeal, given the strength of their business franchises, their continued solid financial performance, and their prospects for continued growth into the future. The following table highlights the financial performance and valuation characteristics of the Fund’s largest holdings as of June 30, 2006:

           
P/E
P/E
 
EPS
ERNS
 
Price
Price
EPS
   
5 YR
5 YR
P/E
L4Q
LT
 
% Chg
% Chg
5 YR Hist
P/E
P/E
Avg
Avg
10 YR
Vs YR
Future
Company Name
YTD
12 Mths
Gr Rate
2006
2007
Hi
Lo
Avg
Ago
Gr Rate
CAPITAL ONE FIN’L
-1%
7%
23%
10.8
10.3
18.2
9.8
19.0
20%
13%
ALTRIA GROUP
-2%
14%
3%
13.9
13.0
13.9
10.0
12.1
8%
8%
BEST BUY
26%
20%
21%
24.1
19.6
31.5
15.8
37.4
20%
16%
FEDEX
13%
44%
25%
19.5
17.2
25.3
17.8
20.4
25%
15%
QUALCOMM
-7%
21%
27%
24.6
21.8
49.6
28.2
63.7
22%
20%
ANADARKO PETROLEUM
1%
16%
22%
8.5
7.7
14.8
7.8
29.5
55%
8%
OMNICARE
-17%
12%
21%
14.9
12.3
25.7
14.2
26.2
15%
15%
CHEVRON
9%
11%
23%
7.9
8.1
14.2
10.0
17.2
25%
8%
GOLDMAN SACHS GROUP
18%
48%
35%
8.8
9.0
18.5
12.0
15.8
88%
15%
FIRST DATA
5%
12%
15%
18.9
16.5
26.8
18.5
24.2
5%
13%
JOHNSON & JOHNSON
0%
-8%
16%
16.3
14.9
26.0
19.2
26.3
9%
10%
NABORS INDUSTRIES
-11%
12%
25%
9.9
7.4
44.6
19.2
39.3
115%
39%
WELLS FARGO
7%
9%
15%
13.5
12.2
18.0
13.8
17.5
13%
11%
MEDTRONIC
-19%
-9%
15%
21.2
19.3
38.3
26.8
38.0
19%
15%
AMGEN
-17%
8%
28%
17.8
15.7
43.5
26.9
36.5
31%
14%
PEPSICO
2%
11%
12%
20.3
18.4
27.4
21.6
28.1
15%
11%
WAL-MART STORES
3%
0%
14%
16.4
14.5
31.3
22.9
30.5
10%
14%
WEST
14%
25%
17%
20.8
17.9
26.2
15.0
21.8
30%
16%
HOME DEPOT
-12%
-8%
20%
11.6
10.4
27.7
16.1
32.5
21%
13%
HORTON (D.R.)
-33%
-37%
42%
4.8
5.7
10.8
5.7
9.3
41%
15%
UNIVERSE AVER(EQ WT)
-1%
10%
21%
15.2
13.6
26.6
16.6
27.3
29%
14%
 
 
3

 
A valid question might be: “If the Fund’s companies are so good, why is their stock price performance lagging in 2006? What is motivating other investors to sell companies you continue to hold, and buy more of?”

We believe the answer lies in the notion that in difficult markets, investors will tend to chase short term performance, and sell relatively poor performing assets in the short run in order to provide the capital to buy whatever is “working” at the time. Consequently, those investors with relatively longer time horizons (such as the Fund) can at times find themselves very much out of step with what is currently doing well in the market; the tradeoff is that the valuation discrepancies created by shorter term fund flows set the stage for better performance longer term.

Many of our core holdings are down 10-20% in price over the past twelve months, despite growing their earnings 10-20% over the same time frame. We believe it is better to focus on financial performance and valuation as opposed to stock price movement; this has hurt us during the first two quarters of 2006, but we believe it positions us well over the next several years.

We appreciate your patience during a period of difficult performance and welcome any questions or comments you have about the Fund.
 
 
 
Sincerely,
 
 
Edson L. Bridges III, CFA
  President and Chief Executive Officer
 
 

 
4

 
Exhibit 1

BRIDGES INVESTMENT FUND, INC

PORTFOLIO TRANSACTIONS
DURING THE PERIOD FROM
APRIL 01, 2006 THROUGH JUNE 30, 2006


 
Bought or
 
Held After
Securities
Received
 
Transactions
Common Stock Unless Described Otherwise
$1,000 Par
 
$1,000 Par
 
Value (M)
 
Value (M)
 
or Shares
 
or Shares
       
Anadarko Petroleum Corp.1
20,000
 
40,000
Chesapeake Energy Corp.
5,000
 
40,000
Countrywide Credit Industries, Inc.
13,000
 
13,000
Expeditors International of Washington, Inc.2
7,000
 
14,000
Fedex Corp.
3,000
 
18,000
Horton (D.R.), Inc.
20,000
 
60,000
Illinois Tool Works, Inc.3
14,000
 
14,000
Legg Mason, Inc.
1,000
 
3,000
Marvell Technogy Group Ltd.
5,000
 
5,000
Microsemi Corp.
5,000
 
15,000
Omnicare, Inc.
10,000
 
40,000
QUALCOMM, Inc.
5,000
 
50,000
Sandisk Corp.
2,000
 
7,000
Vulcan Materials Co.
12,000
 
12,000
West Corp.
2,000
 
30,000
Various Issues of Commercial Paper Notes
29,930
 
4,400
Purchased during 2nd Quarter, 2006
     
       
1 Received 20,000 shares in 2 for 1 stock split on May 30,2006
     
2 Received 7,000 shares in 2 for 1 stock split on June 26, 2006
     
3 Received 7,000 shares in 2 for 1 stock split on May 26, 2006
     


 

5

 
Exhibit 1
(continued)

BRIDGES INVESTMENT FUND, INC

PORTFOLIO TRANSACTIONS
DURING THE PERIOD FROM
APRIL 01, 2006 THROUGH JUNE 30, 2006

 
Sold or
 
Held After
Securities
Exchanged
 
Transactions
Common Stock Unless Described Otherwise
$1,000 Par
 
$1,000 Par
 
Value (M)
 
Value (M)
 
or Shares
 
or Shares
       
Altria Group, Inc.
5,000
 
45,000
Applied Materials, Inc.
40,000
   
Best Buy, Inc.
5,000
 
55,000
Expeditors International of Washington, Inc.
5,000
 
7,000
Freddie Mac
15,000
   
Goldman Sachs Group, Inc.
1,000
 
12,000
Intel Corp.
25,000
   
Marvell Technology Group Ltd.
5,000
   
Microsemi Corp.
15,000
   
Nike, Inc. CL B
10,000
   
Sandisk Corp.
7,000
   
Symantec Corp.
70,000
   
William Sonoma, Inc.
17,000
   
Various Issues of Commercial Paper Notes
26,930
   
Sold or Maturing during 2nd Quarter, 2006
     

 
 
 
 
 

6

 
Exhibit 2

BRIDGES INVESTMENT FUND, INC.

SELECTED HISTORICAL FINANCIAL INFORMATION

Year End Statistics

         
Shares
 
Net Asset
     
Capital
 
 
Valuation Date
Net Assets
 
Outstanding
 
Value/Share
Dividend/ Share
Gains/Share
 
 
07-01-63
$
109,000
 
10,900
 $
10.00
$
$
 
 
12-31-63
 
159,187
 
15,510
 
10.13
 
.07
 
 
 
12-31-64
 
369,149
 
33,643
 
10.97
 
.28
 
 
 
12-31-65
 
621,241
 
51,607
 
12.04
 
.285
 
.028
 
 
12-31-66
 
651,282
 
59,365
 
10.97
 
.295
 
 
 
12-31-67
 
850,119
 
64,427
 
13.20
 
.295
 
 
 
12-31-68
 
1,103,734
 
74,502
 
14.81
 
.315
 
 
 
12-31-69
 
1,085,186
 
84,807
 
12.80
 
.36
 
 
 
12-31-70
 
1,054,162
 
90,941
 
11.59
 
.37
 
 
 
12-31-71
 
1,236,601
 
93,285
 
13.26
 
.37
 
 
 
12-31-72
 
1,272,570
 
93,673
 
13.59
 
.35
 
.08
 
 
12-31-73
 
1,025,521
 
100,282
 
10.23
 
.34
 
.07
 
 
12-31-74
 
757,545
 
106,909
 
7.09
 
.35
 
 
 
12-31-75
 
1,056,439
 
111,619
 
9.46
 
.35
 
 
 
12-31-76
 
1,402,661
 
124,264
 
11.29
 
.38
 
 
 
12-31-77
 
1,505,147
 
145,252
 
10.36
 
.428
 
.862
 
 
12-31-78
 
1,574,097
 
153,728
 
10.24
 
.481
 
.049
 
 
12-31-79
 
1,872,059
 
165,806
 
11.29
 
.474
 
.051
 
 
12-31-80
 
2,416,997
 
177,025
 
13.65
 
.55
 
.0525
 
 
12-31-81
 
2,315,441
 
185,009
 
12.52
 
.63
 
.0868
 
 
12-31-82
 
2,593,411
 
195,469
 
13.27
 
.78
 
.19123
 
 
12-31-83
 
3,345,988
 
229,238
 
14.60
 
.85
 
.25
 
 
12-31-84
 
3,727,899
 
278,241
 
13.40
 
.80
 
.50
 
 
12-31-85
 
4,962,325
 
318,589
 
15.58
 
.70
 
.68
 
 
12-31-86
 
6,701,786
 
407,265
 
16.46
 
.688
 
.86227
 
 
12-31-87
 
7,876,275
 
525,238
 
15.00
 
.656
 
1.03960
 
 
12-31-88
 
8,592,807
 
610,504
 
14.07
 
.85
 
1.10967
 
 
12-31-89
 
10,895,182
 
682,321
 
15.97
 
.67
 
.53769
 
 
12-31-90
 
11,283,448
 
744,734
 
15.15
 
.67
 
.40297
 
 
12-31-91
 
14,374,679
 
831,027
 
17.30
 
.66
 
.29292
 
 
12-31-92
 
17,006,789
 
971,502
 
17.51
 
.635
 
.15944
 
 
12-31-93
 
17,990,556
 
1,010,692
 
17.80
 
.6225
 
.17075
 
 
12-31-94
 
18,096,297
 
1,058,427
 
17.10
 
.59
 
.17874
 
 
12-31-95
 
24,052,746
 
1,116,620
 
21.54
 
.575
 
.19289
 
 
12-31-96
 
29,249,488
 
1,190,831
 
24.56
 
.55
 
.25730
 
 
12-31-97
 
36,647,535
 
1,262,818
 
29.02
 
.5075
 
.30571
 
 
12-31-98
 
48,433,113
 
1,413,731
 
34.26
 
.44
 
2.11648
 
 
12-31-99
 
69,735,684
 
1,508,154
 
46.24
 
.30
 
.91088
 
 
12-31-00
 
71,411,520
 
1,850,301
 
38.59
 
.40
 
.80880716
 

 
 
7

 

 
         
Shares
 
Net Asset
     
Capital
 
 
Valuation Date
 
Net Assets
 
Outstanding
 
Value/Share
 
Dividend/ Share
 
Gains/Share
 
 
12-31-01
$
60,244,912
 
1,940,494
$
31.05
$
.26
$
 
 
12-31-02
 
45,854,541
 
1,989,769
 
23.05
 
.20
 
 
 
12-31-03
 
62,586,435
 
2,016,560
 
31.04
 
.24
 
 
 
12-31-04
 
74,281,648
 
2,230,038
 
33.31
 
.305
 
 
 
12-31-05
 
80,715,484
 
2,305,765
 
35.01
 
.2798
 
 
 
CURRENT QUARTER COMPARED TO SAME QUARTER IN PRIOR YEAR
 
         
Shares
 
Net Asset
     
Capital
 
 
Valuation Date
 
Net Assets
 
Outstanding
 
Value/Share
 
Dividend/ Share
 
Gains/Share
 
 
06-30-05
$
74,688,720
 
2,270,208
$
32.90
$
.076
$
 
 
06-30-06
 
80,249,558
 
2,380,724
 
33.71
 
.065
 
 
 
 
 
 
 
 
 
 
 
 
 

 
8

 
Bridges Investment Fund, Inc.

Expense Example

June 30, 2006
(Unaudited)

As a shareholder of The Bridges Investment Fund, Inc., you incur ongoing costs, including management fees; services fees; and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the period and held the entire period (January 1, 2006 - June 30, 2006).

ACTUAL EXPENSES

The first line of the table below provides information about actual account values and actual expenses. Although the Fund charges no sales load or transactions fees, you will be assessed fees for outgoing wire transfers, returned checks or stop payment orders at prevailing rates charged by U.S. Bancorp Fund Services, LLC, the Fund’s transfer agent. If you request a redemption be made by wire transfer, currently a $15.00 fee is charged by the Fund’s transfer agent. To the extent that the Fund invests in shares of other investment companies as part of its investment strategy, you will indirectly bear your proportionate share of any fees and expenses charged by the underlying funds in which a Fund invests in addition to the expenses of the Fund. Actual expenses of the underlying funds are expected to vary among the various underlying funds. These expenses are not included in the example below. The example includes, but is not limited to, management fees, shareholder servicing fees, fund accounting, custody and transfer agent fees. However, the example below does not include portfolio trading commissions and related expenses, interest expense or dividends on short positions taken by the Fund and other extraordinary expenses as determined under generally accepted accounting principles. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES

The second line of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratios and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
 
 
 
9

 
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees, or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

     
Expenses Paid
 
Beginning
Ending
During Period*
 
Account Value
Account Value
January 1, 2006
 
January 1, 2006
June 30, 2006
- June 30, 2006
Actual
$1,000.00
$ 966.10
$3.98
Hypothetical (5% return before expenses)
1,000.00
1,020.74
4.09
       
* Expenses are equal to the Fund’s annualized expense ratio of 0.82%, multiplied by the average account value over the period,
multiplied by 181/365 to reflect the one-half year period.
     

 
 
 
 
 
 
 
 
 

 
10

 
BRIDGES INVESTMENT FUND, INC.

ALLOCATION OF PORTFOLIO HOLDINGS

JUNE 30, 2006
(Unaudited)


 
COMPONENTS OF PORTFOLIO HOLDINGS
   
Common Stock
$70,400,590
Preferred Stock
754,900
U.S. Treasury Obligations
354,844
Corporate Bonds
3,122,386
Short Term Investments
5,612,826
Total
$80,245,546


 
 
 
 
 
 

11

 
BRIDGES INVESTMENT FUND, INC.

SCHEDULE OF INVESTMENTS

JUNE 30, 2006
(Unaudited)

Title of Security
Shares
 
Cost
 
Value
COMMON STOCKS - 87.73%
         
Air Freight & Logistics - 3.60%
         
Expeditors International Washington, Inc.
14,000
$
261,879
$
784,140
FedEx Corp.
18,000
 
1,491,254
 
2,103,480
   
$
1,753,133
$
2,887,620
Beverages - 1.87%
         
PepsiCo, Inc.
25,000
$
698,139
$
1,501,000
Biotechnology - 2.03%
         
Amgen, Inc.(a)
25,000
$
1,222,615
$
1,630,750
Capital Markets—3.71%
         
The Goldman Sachs Group, Inc.
12,000
$
1,181,047
$
1,805,160
Legg Mason, Inc.
3,000
 
332,431
 
298,560
State Street Corp.
15,000
 
62,367
 
871,350
   
$
1,575,845
$
2,975,070
Commercial Banks - 2.09%
         
Wells Fargo & Co.
25,000
$
1,122,293
$
1,677,000
Commercial Services & Supplies - 1.79%
         
West Corp.(a)
30,000
$
701,215
$
1,437,300
Communications Equipment - 3.71%
         
Cisco Systems, Inc.(a)
50,000
$
546,887
$
976,500
QUALCOMM, Inc.
50,000
 
1,986,505
 
2,003,500
   
$
2,533,392
$
2,980,000
Construction Materials - 1.17%
         
Vulcan Materials Co.
12,000
$
1,040,123
$
936,000
Consumer Finance - 7.21%
         
Capital One Financial Corp.
53,500
$
1,935,422
$
4,571,575
Nelnet, Inc.(a)
30,000
 
600,289
 
1,216,500
   
$
2,535,711
$
5,788,075
Depository Institutions - 1.29%
         
First National of Nebraska, Inc.
225
$
387,969
$
1,035,000
Diversified Financial Services - 1.20%
         
Citigroup, Inc.
20,000
$
940,437
$
964,800
           
See accompanying Notes to the Financial Statements.
       
           
Percentages are stated as a percent of net assets.
         
(a) Non Income Producing
         

 

12



BRIDGES INVESTMENT FUND, INC.

SCHEDULE OF INVESTMENTS
(Continued)

JUNE 30, 2006
(Unaudited)

Title of Security
Shares
 
Cost
 
Value
COMMON STOCKS - (Continued)
         
Energy Equipment & Services - 2.10%
         
Nabors Industries Ltd.(a)
50,000
$
1,745,323
$
1,689,500
Food & Staples Retailing - 1.80%
         
Wal-Mart Stores, Inc.
30,000
$
1,442,592
$
1,445,100
Health Care Equipment & Supplies - 4.60%
         
Medtronic, Inc.
35,000
$
1,841,528
$
1,642,200
Stryker Corp.
15,000
 
620,307
 
631,650
Zimmer Holdings, Inc.(a)
25,000
 
1,734,289
 
1,418,000
   
$
4,196,124
$
3,691,850
Health Care Providers & Services - 4.80%
         
Express Scripts, Inc.(a)
10,000
$
521,574
$
717,400
Omnicare, Inc.
40,000
 
1,460,844
 
1,896,800
Wellpoint, Inc.(a)
17,000
 
1,188,129
 
1,237,090
   
$
3,170,547
$
3,851,290
Hotels Restaurants & Leisure - 2.81%
         
Carnival Corp.
20,000
$
778,740
$
834,800
Harrah’s Entertainment, Inc.
20,000
 
656,022
 
1,423,600
   
$
1,434,762
$
2,258,400
Household Durables - 2.41%
         
Centex Corp.
10,000
$
238,696
$
503,000
DR Horton, Inc.
60,000
 
863,544
 
1,429,200
   
$
1,102,240
$
1,932,200
Insurance - 2.95%
         
American International Group, Inc.
22,000
$
1,304,817
$
1,299,100
Berkshire Hathaway, Inc.(a)
350
 
492,609
 
1,065,050
   
$
1,797,426
$
2,364,150
Internet & Catalog Retail - 0.91%
         
eBay, Inc.(a)
25,000
$
418,062
$
732,250
IT Services - 3.38%
         
First Data Corp.
40,000
$
1,488,450
$
1,801,600
Fiserv, Inc.(a)
20,000
 
664,527
 
907,200
   
$
2,152,977
$
2,708,800
See accompanying Notes to the Financial Statements.
       
           
Percentages are stated as a percent of net assets.
         
(a) Non Income Producing
         

 

13

 
BRIDGES INVESTMENT FUND, INC.

SCHEDULE OF INVESTMENTS
(Continued)

JUNE 30, 2006
(Unaudited)

Title of Security
Shares
 
Cost
 
Value
COMMON STOCKS - (Continued)
         
Machinery - 0.83%
         
Illinois Tool Works, Inc.
14,000
$
694,668
$
665,000
Media - 1.76%
         
Comcast Corp.(a)
20,000
$
601,925
$
655,600
The McGraw-Hill Companies, Inc.
15,000
 
664,690
 
753,450
   
$
1,266,615
$
1,409,050
Multiline Retail - 1.52%
         
Target Corp.
25,000
$
587,011
$
1,221,750
Oil & Gas - 7.48%
         
Anadarko Petroleum Corp.
40,000
$
1,349,605
$
1,907,600
Apache Corp.
15,000
 
956,067
 
1,023,750
Chesapeake Energy Corp.
40,000
 
1,261,878
 
1,210,000
ChevronTexaco Corp.
30,000
 
889,181
 
1,861,800
   
$
4,456,731
$
6,003,150
Oil, Gas & Consumable Fuels - 1.30%
         
BP PLC - ADR
15,000
$
368,832
$
1,044,150
Pharmaceuticals - 4.56%
         
Allergan, Inc.
10,000
$
782,197
$
1,072,600
Johnson & Johnson
30,000
 
1,197,391
 
1,797,600
Teva Pharmaceutical Industries, Ltd. - ADR
25,000
 
667,699
 
789,750
   
$
2,647,287
$
3,659,950
Semiconductor & Semiconductor Equipment - 0.40%
         
Broadcom Corp.(a)
10,500
$
363,637
$
318,465
Software - 1.68%
         
Fair Isaac Corp.
18,000
$
234,627
$
653,580
Microsoft Corp.
30,000
 
266,000
 
699,000
   
$
500,627
$
1,352,580
           
           
           
See accompanying Notes to the Financial Statements.
       
           
Percentages are stated as a percent of net assets.
         
ADR - American Depositary Receipt
         
(a) Non Income Producing
         

 

14

 
BRIDGES INVESTMENT FUND, INC.

SCHEDULE OF INVESTMENTS
(Continued)

JUNE 30, 2006
(Unaudited)

Title of Security
Shares
 
Cost
 
Value
COMMON STOCKS - (Continued)
         
Specialty Retail - 8.03%
         
Best Buy Co, Inc.
55,000
$
1,210,476
$
3,016,200
Home Depot, Inc.
40,000
 
1,088,425
 
1,431,600
Lowe’s Cos, Inc.
20,000
 
1,111,622
 
1,213,400
O’Reilly Automotive, Inc.(a)
25,000
 
587,889
 
779,750
   
$
3,998,412
$
6,440,950
Thrifts & Mortgage Finance - 0.62%
         
Countrywide Financial Corp.
13,000
$
496,568
$
495,040
Tobacco - 4.12%
         
Altria Group, Inc.
45,000
$
1,948,822
$
3,304,350
           
TOTAL COMMON STOCKS (Cost $49,300,135)
 
$
49,300,135
$
70,400,590
           
PREFERRED STOCKS - 0.94%
         
Non-depository Credit Institutions - 0.31%
         
Harris Preferred Capital Corp.
10,000
$
250,000
$
248,400
Real Estate - 0.63%
         
Equity Office Properties Trust
10,000
$
272,179
$
255,500
Public Storage, Inc.
10,000
 
270,038
 
251,000
   
$
792,217
$
506,500
           
TOTAL PREFERRED STOCKS (Cost $792,217)
 
$
792,217
$
754,900
           
U.S. TREASURY OBLIGATIONS - 0.44%
         
 
 
Principal
       
 
Amount
       
United States Treasury Bonds - 0.44%
         
7.500% due 11/15/2016
300,000
$
305,742
$
354,844
TOTAL U.S. TREASURY OBLIGATIONS (Cost $305,742)
 
$
305,742
$
354,844
 
 
 
 
See accompanying Notes to the Financial Statements.
 
Percentages are stated as a percent of net assets.
(a) Non Income Producing
 
 

 
15

 
BRIDGES INVESTMENT FUND, INC.

SCHEDULE OF INVESTMENTS
(Continued)

JUNE 30, 2006
(Unaudited)

 
Principal
       
Title of Security
Amount
 
Cost
 
Value
CORPORATE BONDS - 3.89%
         
Consumer Finance - 0.40%
         
Ford Motor Credit Co. 7.875% due 06/15/2010
$350,000
$
341,733
$
322,872
Depository Institutions - 0.34%
         
MBNA Corporation Senior Note 7.500% due 03/15/2012
250,000
$
261,929
$
270,428
Diversified Telecommunication Services - 0.43%
         
Level 3 Communications, Inc.11.500% due 03/01/2010
350,000
$
293,318
$
346,500
(Acquired 01/13/2006, Cost $293,318)(b)
         
Electric Services - 0.25%
         
MidAmerican Energy Holdings Co. 7.630% due 10/15/2007
200,000
$
200,000
$
204,279
Electric Utilities - 0.35%
         
Duke Capital Corp. 8.000% due 10/01/2019
250,000
$
274,300
$
282,661
Food Products - 0.31%
         
Kraft Foods, Inc. 6.250% due 06/01/2012
250,000
$
260,013
$
252,917
General Merchandise Stores - 0.19%
         
Dillard Department Stores, Inc. 7.850% due 10/01/2012
150,000
$
150,670
$
154,500
Health Care Providers & Services - 0.32%
         
Cardinal Health, Inc. 6.750% due 02/15/2011
250,000
$
256,350
$
256,321
           
Hotels, Rooming Houses, Camps, And
         
Other Lodging Places - 0.33%
         
Marriott International, Inc. 7.875% due 09/15/2009
250,000
$
250,032
$
263,690
Multiline Retail - 0.33%
         
JCPenney Co., Inc. 7.400% due 04/01/2037
250,000
$
263,443
$
261,870
Semiconductor & Semiconductor Equipment - 0.33%
         
Applied Materials, Inc. 7.125% due 10/15/2017
250,000
$
255,338
$
261,348
Tobacco - 0.31%
         
R.J. Reynolds Holdings, Inc. 7.250% due 06/01/2012
250,000
$
257,598
$
245,000
           
TOTAL CORPORATE BONDS (Cost $3,064,724)
 
$
3,064,724
$
3,122,386
           
           
See accompanying Notes to the Financial Statements.
       
           
Percentages are stated as a percent of net assets.
         
(b) Restricted
         
 

 
16

 
BRIDGES INVESTMENT FUND, INC.

SCHEDULE OF INVESTMENTS
(Continued)

JUNE 30, 2006
(Unaudited)

 
Principal
       
Title of Security
Amount
 
Cost
 
Value
SHORT TERM INVESTMENTS - 7.00%
         
Commercial Paper - 5.48%
         
American Express Credit Corp
         
5.250%, 07/07/2006
$2,000,000
$
1,998,299
$
 1,998,299
Prudential Funding Corp.
         
5.230%, 07/05/2006
2,400,000
$
2,398,645
$
 2,398,645
           
 
Shares
       
Mutual Funds - 1.52%
         
SEI Daily Income Trust Treasury Fund 4.480%
1,215,882
$
1,215,882
$
1,215,882
           
TOTAL SHORT TERM INVESTMENTS (Cost $5,612,826)
 
$
5,612,826
$
 5,612,826
 
         
TOTAL INVESTMENTS (Cost $59,075,644) - 100.00%
     
$
80,245,546
OTHER ASSETS IN EXCESS OF LIABILITIES - 0.00%
       
4,012
TOTAL NET ASSETS - 100.00%
     
$
80,249,558

 

 
 
 
 
 
 
 
See accompanying Notes to the Financial Statements.
 
Percentages are stated as a percent of net assets.
 

17

 
BRIDGES INVESTMENT FUND, INC.

STATEMENT OF ASSETS AND LIABILITIES

FOR THE SIX MONTHS ENDED JUNE 30, 2006
(Unaudited)

ASSETS:
   
Investments in securities, at fair value (cost: $59,075,644)
$
80,245,546
Receivables
   
Dividends and interest
 
117,403
Fund shares issued
 
63,018
Other assets
 
4,666
TOTAL ASSETS
$
80,430,633
     
LIABILITIES:
   
Payables
   
Advisory fees
$
99,620
Distribution to shareholders
 
21,316
Fund shares redeemed
 
28
Accrued expenses
 
60,111
TOTAL LIABILITIES
$
181,075
     
TOTAL NET ASSETS
$
80,249,558
     
NET ASSETS CONSIST OF:
   
Capital stock
$
61,280,383
Accumulated undistributed net investment income
 
20,419
Accumulated undistributed net realized loss on investments
 
(2,221,146)
Unrealized appreciation on investments
 
21,169,902
TOTAL NET ASSETS
$
80,249,558
     
SHARES OUTSTANDING (UNLIMITED SHARES OF
   
NO PAR VALUE AUTHORIZED)
 
2,380,724
NET ASSET VALUE, OFFERING AND REDEMPTION
   
PRICE PER SHARE
$
33.71
     
     
     
See accompanying Notes to the Financial Statements.
   


18


 
BRIDGES INVESTMENT FUND, INC.

STATEMENT OF OPERATIONS

FOR THE SIX MONTHS ENDED JUNE 30, 2006
(Unaudited)

INVESTMENT INCOME:
   
Dividend income (net of foreign taxes withheld of $587)
$
430,662
Interest income
 
184,278
     
Total investment income
$
614,940
     
EXPENSES:
   
Advisory fees
$
203,382
Administration fees
 
20,815
Professional services
 
23,711
Dividend disbursing and transfer agent fees
 
28,882
Fund accounting fees
 
22,504
Taxes and licenses
 
724
Custody fees
 
6,020
Printing and supplies
 
8,430
Independent directors expenses and fees
 
8,869
Other
 
8,958
     
Total expenses
$
332,295
NET INVESTMENT INCOME
$
282,645
     
NET REALIZED AND UNREALIZED GAIN/(LOSS) ON INVESTMENTS:
   
Net realized gain on investments
$
107,660
Net change in unrealized depreciation on investments
 
(3,205,661)
     
NET REALIZED AND UNREALIZED LOSS ON INVESTMENTS:
 
(3,098,001)
     
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS
$
(2,815,356)
     
     
     
See accompanying Notes to the Financial Statements.
   

 
 
 
 
 
 
 

19

 
BRIDGES INVESTMENT FUND, INC.

STATEMENTS OF CHANGES IN NET ASSETS

FOR THE SIX MONTHS ENDED JUNE 30, 2006 AND 2005
(Unaudited)

   
2006
 
2005
OPERATIONS:
       
Net investment income
$
282,645
$
347,519
Net realized gain/(loss) on investments
 
107,660
 
(184,454)
Net change in unrealized depreciation on investments
 
(3,205,661)
 
(673,218)
Net decrease in assets resulting from operations
 
(2,815,356)
 
(510,153)
         
Net Equalization debits/credits:
 
1,892
 
(1,200)
Distributions to shareholders:
       
From net investment income
 
(271,169)
 
(338,338)
Total distributions
 
(271,169)
 
(338,338)
         
Capital Share Transactions:
       
Net increase in net assets from capital share transactions
 
2,618,707
 
1,256,763
         
Total increase/(decrease) in net assets
 
(465,926)
 
407,072
         
NET ASSETS:
       
Beginning of period
 
80,715,484
 
74,281,648
         
End of six months (includes $20,419 and $19,911 of undistributed net
       
investment income in 2006 and 2005)
$
80,249,558
$
74,688,720
         
         
         
See accompanying Notes to the Financial Statements.
       



 
 
 
 
 
 

20

 
BRIDGES INVESTMENT FUND, INC.

FINANCIAL HIGHLIGHTS

Per share data for a share of capital stock outstanding for the entire period and selected information for the period are as follows:
 
   
(Unaudited)
                   
   
Period Ended
                   
   
June 30,
     
Year Ended December 31,
   
   
2006
 
2005
 
2004
 
2003
 
2002
 
2001
Net Asset Value: Beginning of period
$
 35.01
$
 33.31
$
 31.04
$
 23.05
$
 31.05
$
 38.59
Operations:
                       
Net investment income 1
 
0.12
 
0.28
 
0.31
 
0.24
 
0.20
 
0.26
Net realized and unrealized
                       
gain (loss)
                       
on investment securities
 
(1.30)
 
1.70
 
2.27
 
7.99
 
(8.00)
 
(7.54)
Total from operations
 
(1.18)
 
1.98
 
2.58
 
8.23
 
(7.80)
 
(7.28)
                         
Less distributions:
                       
From net investment income
 
(0.12)
 
(0.28)
 
(0.31)
 
(0.24)
 
(0.20)
 
(0.26)
From net realized gains
 
-
 
-
 
-
 
-
 
-
 
-
Total distributions
 
(0.12)
 
(0.28)
 
(0.31)
 
(0.24)
 
(0.20)
 
(0.26)
Net Asset Value:
                       
End of period
$
 33.71
$
 35.01
$
 33.31
$
 31.04
$
 23.05
$
 31.05
                         
Total return
 
-3.39%2
 
5.99%
 
8.36%
 
35.83%
 
-25.13%
 
-18.89%
                         
Ratio/Supplemental Data
                       
Net assets at end of period
                       
(000s omitted)
$
80,250
$
80,715
$
74,282
$
62,586
$
45,855
$
60,245
                         
Ratio of Expenses to Average
                       
Net Assets
 
0.82%3
 
0.85%
 
0.85%
 
0.89%
 
0.85%
 
0.79%
                         
Ratio of Net Investment Income to
                       
Average Net Assets
 
0.70%3
 
0.84%
 
0.98%
 
0.91%
 
0.79%
 
0.79%
Portfolio turnover rate
 
11%
 
24%
 
17%
 
26%
 
23%
 
14%
                         
 
1 Net investment income per share is calculated using the ending balances prior to consideration or adjustment for permanent
book-to-tax differences.
             
2 Not Annualized.
             
3 Annualized
             


 
 
 
 
 
 

21

 
BRIDGES INVESTMENT FUND, INC.

NOTES TO FINANCIAL STATEMENTS

JUNE 30, 2006
(Unaudited)

(1)
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Bridges Investment Fund, Inc. (the “Fund”) is registered under the Investment Company Act of 1940 as a diversified, open-end management investment company. The primary investment objective of the Fund is long-term capital appreciation. In pursuit of that objective, the Fund invests primarily in common stocks. The following is a summary of significant accounting policies consistently followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America.
 
A.
Investments -
 
Security transactions are recorded on trade date. Dividend income is recognized on the ex-divided date, and interest income is recognized on an accrual basis. Discount and premium on fixed income securities is accreted or amortized into interest income using the effective interest method.

The net realized gain (loss) from the sales of securities is determined for income tax and accounting purposes on the basis of the cost of specific securities.

Securities owned are reflected in the accompanying statements of assets and liabilities and the schedule of investments at fair value based on quoted market prices. Quoted market prices represent the last recorded sales price on the last business day of the calendar year for securities traded on a national securities exchange. If no sales were reported on that day, quoted market price represents the closing bid price. Securities for which quotations are not readily available are valued at fair value as determined by the Board of Directors. The cost of investments reflected in the statement of assets and liabilities and the schedule of investments is approximately the same as the basis used for federal income tax purposes.

B.
Federal Income Taxes -

It is the Fund’s policy to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies to distribute all of its taxable income to shareholders. Therefore, no Federal income tax provision is required. Under applicable foreign tax law, a withholding tax may be imposed on interest, dividends, and capital gains at various rates.

The character of distributions made during the year from net investment income or net realized gains may differ from its ultimate characterization for federal income tax purposes. In addition, due to the timing of dividend distributions, the fiscal year in which amounts are distributed may differ from the year that the income or realized gains or losses were recorded by the Fund.

C.
Distribution To Shareholders -
 
The Fund accrues dividends to shareholders on a quarterly basis as of the ex-dividend date. Distribution of net realized gains, if any, are made on an annual basis to shareholders as of the ex-dividend date.

D.
Equalization -

The Fund uses the accounting practice of equalization by which a portion of the proceeds from sales and costs of redemption of capital shares, equivalent on a per share basis to the amount of undistributed net investment income on the date of the transactions, is credited or charged to
undistributed income. As a result, undistributed net investment income per share is unaffected by sales or redemption of capital shares.
 
 
22

 

E.
Use of Estimates -

The preparation of financial statements in conformity with accounting principles generally accepted in United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

(2)
INVESTMENT ADVISORY CONTRACT AND OTHER TRANSACTIONS WITH AFFILIATES

Under an Investment Advisory Contract, Bridges Investment Management, Inc. (Investment Adviser) furnishes investment advisory services for the Fund. In return, the Fund has agreed to pay the Investment Adviser a management fee computed on a quarterly basis at the rate of 1/8 of 1% of the average month end net asset value of the Fund during the quarter, equivalent to 1/2 of 1% per annum. Certain officers and directors of the Fund are also officers and directors of the Investment Adviser. These officers do not receive any compensation from the Fund other than that which is received indirectly through the Investment Adviser.

The contract between the Fund and the Investment Adviser provides that total expenses of the Fund in any year, exclusive of taxes, but including fees paid to the Investment Adviser, shall not exceed, in total, a maximum of 1 and 1/2% of the average month end net asset value of the Fund for the year. Amounts, if any, expended in excess of this limitation are reimbursed by the Investment Adviser as specifically identified in the Investment Advisory Contract. There were no amounts reimbursed during the year ended December 31, 2005 and the six months ended June 30, 2006.

The Fund has entered into a Board-approved contract with the Investment Adviser in which the Investment Adviser is responsible for providing administrative services to the Fund at an annual rate of $42,000. These administrative expenses are shown as Administration Fees on the Statement of Operations.

(3)
DIVIDEND DISBURSING AND TRANSFER AGENT

Dividend disbursing and transfer agent services were provided by U.S. Bancorp Fund Services, LLC. The fees paid to the Transfer Agent are intended to approximate the cost to the Transfer Agent for providing such services.

(4)
SECURITY TRANSACTIONS

The cost of long-term investment purchases during the six months ended June 30, was:
 
 
 
2006
 
2005
 
United States government obligations
$                                       -
 
$                                       -
 
Securities
8,520,612
 
11,699,928
 
 
$                        8,520,612
 
$                      11,699,928
 
         

Net proceeds from sales of long-term investments during the six months ended June 30, were:
 
 
2006
 
2005
 
United States government obligations
$                           200,000
 
$                                       -
 
Other securities
11,009,414
 
8,793,071
 
Total Net Proceeds
$                      11,209,414
 
$                        8,793,071
 

 

23



(5)
NET ASSET VALUE

The net asset value per share represents the effective price for all subscription and redemptions.

(6)
CAPITAL STOCK

Shares of capital stock issued and redeemed during the six months ended June 30, were as follows:

 
2006
 
2005
Shares sold
132,777
 
127,094
Shares issued to shareholders in reinvestment of
     
net investment income
6,755
 
8,728
 
139,532
 
135,822
Shares redeemed
(64,573)
 
(95,652)
Net increase
74,959
 
40,170
       
 
Value of capital stock issued and redeemed during the six months ended June 30, was as follows:
 
 
2006
 
2005
Shares sold
$ 4,622,816
 
$ 4,089,114
Shares issued to shareholders in reinvestment of
     
net investment income
232,543
 
282,709
 
$ 4,855,359
 
$ 4,371,823
Shares redeemed
(2,236,652)
 
(3,115,060)
Net increase
$ 2,618,707
 
$ 1,256,763

 
(7)
DISTRIBUTIONS TO SHAREHOLDERS

On June 30, 2006, a cash distribution was declared from net investment income accrued through June 30, 2006. This distribution was calculated as $0.065 per share. The dividend was paid on June 30, 2006 to shareholders of record on June 29, 2006.

(8)
FEDERAL INCOME TAX INFORMATION

Distributions during the years ended December 31, 2005 and 2004, totaled $638,017 and $662,194 and were characterized as ordinary income for tax purposes.

The character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. These differences reflect the dissimilar character of certain income items and net realized gains and losses for financial statement and tax purposes. Any permanent differences will result in reclassification among certain capital accounts in the financial statements.

As of December 31, 2005, the components of the tax basis cost of investments and net unrealized appreciation were as follows:
 
Federal tax cost of investments
$56,389,518
Unrealized appreciation
$25,554,103
Unrealized depreciation
$ (1,178,540)
Net unrealized appreciation
$24,375,563

 

24


 
As of December 31, 2005, the components of distributable earnings on a tax basis were as follows:

Net unrealized appreciation
$         24,375,563
Undistributed ordinary income
$                       -
Accumulated capital losses
$        (2,324,511)

The accumulated capital losses of $2,324,511 represent net capital loss carryovers that may be used to offset future realized capital gains for federal income tax purposes. The capital loss carryovers expire as follows: $75,255 in 2010, and $1,573,598 in 2011, and $675,658 in 2012.
 
 
 
 
 
 
 
 
 
 
 

 
 

25



ADDITIONAL DISCLOSURES (UNAUDITED)

Shareholder Notification of Federal Tax Status

The Bridges Investment Fund designates 100% of dividends declared during the fiscal year ended December 31, 2005 as dividends qualifying for the dividends received deduction available to corporate shareholders.

The Bridges Investment Fund designates 100% of dividends declared from the net investment income during the fiscal year ended December 31, 2005 as qualified income under the Jobs and Growth Tax Relief Reconciliation Act of 2003.

Availability of Quarterly Portfolio Holdings Schedules

The Fund files its complete schedule of portfolio holdings with the SEC for the First and Third Quarters of each fiscal year on Form N-Q, which is available on the SEC’s website at http:// www.sec.gov or can be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. (information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.) These reports can also be obtained from the Fund by sending an e-mail to fund@bridgesinv.com or calling 1-800-939-8401.

Proxy Voting Policies and Procedures and Proxy Voting Record

A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities, and a report on how the Fund voted such proxies during the 12-month period ended June 30, 2006 can be obtained by request and without charge from the Fund by sending an e-mail to fund@bridgesinv.com or calling 1-800-939-8401, or from the SEC’s website at http://www.sec.gov.

Disclosure Regarding Fund Trustees and Officers

Non-Interested/Independent Directors
     
   
Term of
   
 
Position(s)
Office and
 
Other Trusteeships/
Name, Address (if
Held with
Length of
Principal Occupation(s)
Directorships
applicable) and Age
Fund
Time Served
During Past Five Years
Held by Director
         
N. Phillips Dodge, Jr.
Director
One Year;
President, N. P. Dodge Company,
American States Water
Age: 69
 
Since 1983
1978-present
Company*; Omaha
       
Public Power District
         
John W. Estabrook
Director
One Year;
Retired since 1992; previously was
Provident Trust
Age: 78
 
Since 1979
President and Chief Administrative
Company; Nebraska
     
Officer of Nebraska Methodist
Methodist Hospital
     
Hospital from 1959-1987 and
Foundation; Jennie
     
President of Nebraska Methodist
Edmundsen Hospital
     
Health System from 1987-1992
 
 

 
 
26



   
Term of
   
 
Position(s)
Office and
 
Other Trusteeships/
Name, Address (if
Held with
Length of
Principal Occupation(s)
Directorships
applicable) and Age
Fund
Time Served
During Past Five Years
Held by Director
         
Jon D. Hoffmaster
Director
One Year;
President, W.F. Enterprises, LLC,
None
Age: 57
 
Since 1993
2003-present; President and Chief
 
     
Operating Officer, Chief Financial
 
     
Officer, Executive Vice President
 
     
of InfoUSA from 1987-1998 and
 
     
President and Chief Executive
 
     
Officer of First National Bank
 
     
of Bellevue, Nebraska from
 
     
1980-1987
 
         
John J. Koraleski(1)
Chairman
One Year;
Executive Vice President-
Union Pacific
Age: 55
 
Since 2005
Marketing & Sales, Union Pacific
Foundation
     
Railroad Company, 1999-present;
 
 
Director
One Year;
has been serving Union Pacific
 
   
Since 1995
Railroad Company in various
 
     
capacities since 1972
 
         
Gary L. Petersen
Director
One Year;
Retired since 1986; previously
None
Age: 62
 
Since 1987
was President of Petersen
 
     
Manufacturing Co. Inc. from
 
     
1979-1986, prior to becoming
 
     
President, served Petersen
 
     
Manufacturing in various
 
     
capacities beginning in 1966
 
         
Roy A. Smith
Director
One Year;
President, Old Mill Toyota,
Mid City Bank
Age: 71
 
Since 1976
1978-present; President, H.P.
of Omaha
     
Smith Motors , Inc., 1964-1997
 
         
L.B. Thomas
Director
One Year;
Retired since 1996; previously
Lozier Corp.; Exchange
Age: 70
 
Since 1992
was Senior Vice President, Risk
Bank of Mound City;
     
Officer and Corporate Secretary
Nebraska Methodist
     
of ConAgra, Inc. and held various
Health Systems
     
other executive level positions at
 
     
ConAgra from 1960-1996
 
         
John K. Wilson
Director
One Year;
President, Durham Resources,
MDU Resources
Age: 52
 
Since 1999
LLC, 1994-present; has been
Group, Inc.*
     
serving Durham Resources in
 
     
various capacities since 1983
 
         
 
*
Indicates publicly traded company or investment company.
   
(1)
Mr. Koraleski serves as the Lead Independent Director.
 
   
The address for all Fund Directors is 256 Durham Plaza, 8401 West Dodge Road, Omaha, Nebraska 68114


 
 

27

 
Interested Person Directors and Officers

The following Directors and Officers are interested persons of the Fund. The determination of an interested person is based on the definition in Section 2(a)(19) of the Investment Company Act of 1940, and Securities and Exchange Commission Release (Release No. IC-24083, dated October 14, 1999), providing additional guidance to investment companies about the types of professional and business relationships that may be considered to be material for purposes of Section 2(a)(19).

Interested Directors
       
   
Term of
   
 
Position(s)
Office and
 
Other Trusteeships/
Name, Address (if
Held with
Length of
Principal Occupation(s)
Directorships
applicable) and Age
Fund
Time Served
During Past Five Years
Held by Director
         
Edson L. Bridges II(1)
Chairman
One Year;
President, Bridges Investment
Bridges Investment
Age: 73
Emeritus
Since 2006
Counsel, Inc., 1970-present;
Management, Inc.;
     
President, Bridges Investor
Bridges Investment
 
Vice
One Year;
Services, Inc., 1987-present;
Counsel, Inc.; Bridges
 
Chairman
From
President, Provident Trust
Investor Services, Inc.;
   
2005-2006
Company, 1992-present; Executive
N.P. Dodge Company;
     
Administrator, Bridges Investment
Airlite Plastics
 
Chairman
One Year;
Management, Inc., 2000-present
Company; Provident
   
From
 
Trust Company; Store
   
1997-2005
 
Kraft Manufacturing
       
Company; West
 
President
One Year;
 
Omaha Land &
   
From
 
Cattle Company
   
1970-1997
   
         
 
Chief
One Year;
   
 
Executive
From
   
 
Officer
1997-2004
   
         
 
Director
One Year;
   
   
Since 1963
   
         
Edson L. Bridges III(2)
President
One Year;
President, Bridges Investment
Bridges Investment
Age: 47
 
Since 1997
Management, Inc., 1994-present;
Management, Inc.;
     
Executive Vice President,
Bridges Investment
 
Chief
One Year;
Bridges Investment Counsel, Inc.,
Counsel, Inc.; Bridges
 
Executive
Since 2004
1993-present; held various other
Investor Services,
 
Officer
 
professional level positions
Inc.; Provident
     
at Bridges Investment Counsel
Trust Company;
 
Chief
One Year;
from 1983-1993; Vice President,
Stratus Fund, Inc.*
 
Investment
Since 2004
Provident Trust Company, 1992-
 
 
Officer
 
present; held various positions
 
     
at Bridges Investor Services
 
 
Director
One Year;
Inc., 1987-present, most
 
   
Since 1991
recently Chairman
 
         
 
*
Indicates publicly traded company or investment company.
   
(1)
Edson L. Bridges II is the father of Edson L. Bridges III. Mr. Bridges II is an interested person because he is an officer of the
 
Fund and a director and officer of the Fund’s investment adviser, Bridges Investment Management, Inc.
(2)
Edson L. Bridges III is the son of Edson L. Bridges II. Mr. Bridges III is an interested person because he is an officer of the
 
Fund and a director and officer of the Fund’s investment adviser, Bridges Investment Management, Inc.

 

28


 
Officers
       
   
Term of
   
 
Position(s)
Office and
 
Other Trusteeships/
Name, Address (if
Held with
Length of
Principal Occupation(s) During
Directorships Held by
applicable) and Age
Fund
Time Served
Past Five Years
Officer
         
Nancy K. Dodge
Treasurer
One Year;
Vice President, Bridges Investment
Bridges Investor
Age: 44
 
Since 1986
Management, Inc., 2000-present;
Services, Inc.
     
held various other positions at
 
     
Bridges Investment Management,
 
     
Inc. and Bridges Investment
 
     
Counsel, Inc., 1980-present;
 
     
Trust Administrator, Provident
 
     
Trust Company, 1992-present;
 
     
held various positions at
 
     
Bridges Investor Services,
 
     
Inc., 1987-present, most
 
     
recently Vice President
 
         
Randall D. Greer
Executive
One Year;
Vice President, Bridges Investment
None
Age: 54
Vice
Since 2005
Management, Inc., 2002-present;
 
 
President
 
Senior Vice President, Bridges
 
     
Investment Counsel, Inc., 2002-
 
 
Vice
One Year;
present; Vice President, Provident
 
 
President
From
Trust Company, 2002-present;
 
   
2003-2005
Vice President, Bridges Investor
 
     
Services, Inc., 2003-present; Chief
 
 
Chief
One Year;
Investment Officer of Westchester
 
 
Compliance
Since 2004
Capital Management, Inc., 2000-
 
 
Officer
 
2002; held various management
 
     
positions with Kirkpatrick, Pettis,
 
     
Smith, Polian Inc. (investment
 
     
banking firm and broker-dealer),
 
     
1975-2000
 
         
Brian Kirkpatrick
Vice
One Year;
Vice President of Bridges
None
Age: 34
President
Since 2000
Investment Management, Inc.,
 
     
1994-present; held various
 
     
positions with Bridges Investment
 
     
Counsel, Inc., 1992-present, most
 
     
recently Vice President; Trust
 
     
Assistant, Provident Trust
 
     
Company, 1995-present
 
         
Mary Ann Mason
Secretary
One Year;
Corporate Secretary and Treasurer,
Bridges Investor
Age: 54
 
Since 1987
Bridges Investment Counsel, Inc.,
Services, Inc.
     
1981-present; Secretary/Treasurer,
 
     
Bridges Investment Management,
 
     
Inc., 1994-present; Secretary and
 
     
Treasurer, Bridges Investor
 
     
Services, Inc., 1987-present;
 
     
Secretary, Treasurer, and Trust
 
     
Administrator, Provident Trust
 
     
Company, 1992-present
 


 

29


 
   
Term of
   
 
Position(s)
Office and
 
Other Trusteeships/
Name, Address (if
Held with
Length of
Principal Occupation(s) During
Directorships Held by
applicable) and Age
Fund
Time Served
Past Five Years
Officer
         
Linda Morris
Assistant
One Year;
Held various positions with
None
Age: 39
Treasurer
Since 2000
Bridges Investment Counsel, Inc.,
 
     
1992-present, most recently as
 
     
Associate Director of Accounting;
 
     
Trust Assistant, Provident Trust
 
     
Company, 1995-present
 
         
Trinh Wu
Controller
One Year;
Lead Accountant, Bridges
None
Age: 48
 
Since 2001
Investment Counsel, Inc.,
 
     
1997-present;
 
         
* Indicates publicly traded company or investment company.
 
         
The address for all Fund Officers is 256 Durham Plaza, 8401 West Dodge Road, Omaha, Nebraska 68114.

 

30

 
 
 
 
 
 
BRIDGES INVESTMENT FUND, INC.

8401 West Dodge Road
Omaha, Nebraska 68114

Telephone 402-397-4700
Facsimile 402-397-8617

Directors
 
  Edson L. Bridges II  
  Edson L. Bridges III  
  N. P. Dodge, Jr.  
  John W. Estabrook  
  Jon D. Hoffmaster  
  John J. Koraleski  
  Gary L. Petersen  
  Roy A. Smith  
  L. B. Thomas  
  John K. Wilson  
     
     
 

   
Officers
     
 
John J. Koraleski
Chairman and Lead Independent Director
 
Edson L. Bridges II
Chairman Emeritus
 
Edson L. Bridges III
President and Chief Executive and
   
Investment Officer
 
Randall D. Greer
Executive Vice President and
   
Chief Compliance Officer
 
Brian M. Kirkpatrick
Vice President
 
Mary Ann Mason
Secretary
 
Nancy K. Dodge
Treasurer
 
Linda J. Morris
Assistant Treasurer
 
Trinh Wu
Controller

 
Independent Registered Public Accounting Firm

Deloitte & Touche LLP
First National Tower
1601 Dodge Street, Suite 3100
Omaha, Nebraska 68102


 
Corporate Counsel
Counsel to Independent Directors
     
 
Baird Holm, LLP
Koley Jessen P.C.
 
Attorneys at Law
Attorneys at Law
 
1500 Woodmen Tower
One Pacific Place, Suite 800
 
Omaha, Nebraska 68102
1125 South 103 Street
   
Omaha, Nebraska 68124
     
 
Special Counsel
Distributor
     
 
Ballard, Spahr, Andrews & Ingersoll, LLP
Quasar Distributors, LLC
 
1225 Seventeenth Street, Suite 2300
615 East Michigan Street
 
Denver, Colorado 80202
Milwaukee, Wisconsin 53202

 
 
 
 
 
 
 
 
 

 

Item 2. Code of Ethics.

Not applicable for semi-annual reports.
 
Item 3. Audit Committee Financial Expert.

Not applicable for semi-annual reports.
 
Item 4. Principal Accountant Fees and Services.

Not applicable for semi-annual reports.
 
Item 5. Audit Committee of Listed Registrants.

Not applicable to registrants who are not listed issuers (as defined in Rule 10A-3 under the Securities Exchange Act of 1934).

Item 6. Schedule of Investments.

Schedule of Investments is included as part of the report to shareholders filed under Item 1 of this Form.

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

Not applicable to open-end investment companies.
 
Item 8. Portfolio Managers of Closed-End Management Investment Companies.

Not applicable to open-end investment companies.
 
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.

Not applicable to open-end investment companies.
 
Item 10. Submission of Matters to a Vote of Security Holders.

There have been no material changes to the procedures by which shareholders may recommend nominees to the registrant’s board of directors/trustees.

Item 11. Controls and Procedures.

Background Description of Fund Controls and Procedures: In accordance with SEC Rule 30a-3(a) under the Investment Company Act of 1940 ("1940 Act"), the Fund maintains two separate categories of controls and procedures: (1) disclosure controls and procedures and (2) internal controls over financial reporting. This Item 11 of Form N-CSR is to disclose the conclusions of the Fund's certifying officers with respect to the Fund's disclosure controls and procedures (as defined in Rule 30a-3(c)), designed to ensure that information required to be disclosed by the Fund on Form N-CSR and Form N-Q is recorded, processed, summarized and reported in a timely fashion.

The Fund's investment manager has constituted a committee (the "N-CSR Committee"), comprised of internal staff members, including personnel who are responsible for maintaining or providing information for the Form N-CSR or Form N-Q. The members of the N-CSR Committee are to report to the certifying officers any changes in internal controls for financial statement information or changes in the procedures and practices for information which is used in the Fund shareholder reports and Fund SEC filings. The N-CSR Committee meets periodically to exchange information, evaluate and assess existing controls and procedures and formally update any reportable changes in Fund controls and procedures.
 
(a) Conclusions of Certifying Officers: The Fund's certifying officers, Chief Executive and Investment Officer and President, Edson L. Bridges III, Treasurer, Nancy K. Dodge, and Executive Vice-President and Chief Compliance Officer, Randall D. Greer based on their evaluation as of a date within 90 days of the filing date of this Form N-CSR, including an evaluation of those matters set forth in Item 11(b) below, have concluded that the Fund's disclosure controls and procedures are effective. These conclusions were reached independently by each certifying officer after performing the evaluation required by Rule 30a-3(b) under the 1940 Act and Rule 15d-15(b) under the Securities Exchange Act of 1934.

(b) Changes in the Fund's Internal Control over Financial Reporting: Through June 30, 2006, there were no changes in the Fund's internal control that has materially affected, or is reasonably likely to materially affect, the Fund's internal control over financial reporting.

To a significant degree the Fund’s operating controls and procedures have been delegated to USBFS and its affiliates which are providing the accounting, administrative, distributor, and dividend and transfer agent services described. With respect to the services provided by USBFS and its affiliates, the Fund relies upon the controls and compliance procedures, policies, training and oversight established by USBFS and its affiliates' personnel. Due to this, BIM requested and received a certificate from the USBFS chief compliance officer certifying as to the system of compliance controls of USBFS, and confirmation of no known compliance events related to federal securities laws impacting the Fund.
 
Item 12. Exhibits.

(a)  
(1) Any code of ethics or amendment thereto, that is subject of the disclosure required by Item 2, to the extent that the registrant intends to satisfy Item 2 requirements through filing an exhibit. Incorporate by reference to previous Form N-CSR filing filed February 24, 2006.

(2) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith.

(3) Any written solicitation to purchase securities under Rule 23c-1 under the Act sent or given during the period covered by the report by or on behalf of the registrant to 10 or more persons. Not applicable to open-end investment companies.

(b)  
Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Furnished 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) Bridges Investment Fund, Inc.                                                             

By (Signature and Title /s/ Edson L. Bridges III                                                     
Edson L. Bridges III, President, CEO, CIO

Date        8/14/06                                                                                                                                                                                                    



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 (Signature and Title)*  /s/ Edson L. Bridges III                                                   
Edson L. Bridges III, President, CEO, CIO

Date       8/14/06                                                                                                               

By (Signature and Title)* /s/ Randall D. Greer                                                           
Randall D. Greer, Executive Vice-President, CCO

Date       8/10/06                                                                                                              


By (Signature and Title)*   /s/ Nancy K. Dodge                                                       
 Nancy K. Dodge, Treasurer

Date       8/10/06                                                                                                              

* Print the name and title of each signing officer under his or her signature.
 
 
 
 
 
 
 
 
 

EX-99.CERT 2 certs.htm OFFICER CERTIFICATIONS Officer Certifications

EX.99.CERT
CERTIFICATIONS 

I, Edson L. Bridges III, certify that:

 
1.  
I have reviewed this report on Form N-CSR of Bridges Investment Fund, Inc.;
 
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 registrant's 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) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) 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 its 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 registrant's 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 90 days prior to the filing date of this report based on such evaluation; and
 
(d)  
Disclosed in this report any change in the registrant’s 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 registrant’s internal control over financial reporting; and
 
5.  
The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's 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 registrant's 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 registrant's internal control over financial reporting.

Date: 8/14/06                                  
 
/s/ Edson L Bridges III                               
Edson L. Bridges III
President, Chief Executive Officer, Chief Investment Officer

 
 
 

 
EX.99.CERT
 
CERTIFICATIONS 

I, Randall D. Greer, certify that:

 
1.  
I have reviewed this report on Form N-CSR of Bridges Investment Fund, Inc.;
 
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 registrant's 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) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) 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 its 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 registrant's 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 90 days prior to the filing date of this report based on such evaluation; and
 
(d)  
Disclosed in this report any change in the registrant’s 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 registrant’s internal control over financial reporting; and
 
5.  
The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's 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 registrant's 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 registrant's internal control over financial reporting.

Date: 8/10/06                                  
 
/s/ Randall D. Greer                                 
Randall D. Greer, Executive Vice-President
and Chief Compliance Officer


 
 

 
EX.99.CERT
 
CERTIFICATIONS 

I, Nancy K. Dodge, certify that:

 
1.  
I have reviewed this report on Form N-CSR of Bridges Investment Fund, Inc.;
 
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 registrant's 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) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) 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 its 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 registrant's 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 90 days prior to the filing date of this report based on such evaluation; and
 
(d)  
Disclosed in this report any change in the registrant’s 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 registrant’s internal control over financial reporting; and
 
5.  
The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's 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 registrant's 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 registrant's internal control over financial reporting.

Date: 8/10/06                                  
 
/s/ Nancy K Dodge                         
Nancy K. Dodge
Treasurer

 
 
 

EX-99.906 CERT 3 cert906.htm SARBANES-OXLEY CERTIFICATION Sarbanes-Oxley Certification

EX.99.906CERT

 
Certification Pursuant to Section 906 of the Sarbanes-Oxley Act

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, each of the undersigned officers of the Bridges Investment Fund, Inc., does hereby certify, to such officer’s knowledge, that the report on Form N-CSR of the Bridges Investment Fund, Inc. for the period ended June 30, 2006 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as applicable, and that the information contained in the Form N-CSR fairly presents, in all material respects, the financial condition and results of operations of the Bridges Investment Fund, Inc. for the stated period.


/s/ Edson L. Bridges III                            
Edson L. Bridges III
President, CEO, CIO, Bridges Investment
Fund, Inc.
/s/ Randall D. Greer                                          
Randall D. Greer
Executive Vice-President and CCO, Bridges
Investment Fund, Inc.
Dated:       8/14/06                                         
Dated:         8/10/06                                              
   
/s/ Nancy K. Dodge                                  
Nancy K. Dodge
Treasurer, Bridges Investment Fund, Inc.
 
Dated:        8/10/06                                       
 


This statement accompanies this report on Form N-CSR pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed as filed by Bridges Investment Fund, Inc. for purposes of Section 18 of the Securities Exchange Act of 1934.

 
 
 

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-----END PRIVACY-ENHANCED MESSAGE-----