-----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, D7xkxDP9UCLjo6ac1lA6EE3TO6Ok0MR9iDmwyVWZpjZ7cKYIz3XwQY1huLiZs7eb G+ZEso5yneNo9qBq+TMiCg== 0001047469-03-039763.txt : 20031209 0001047469-03-039763.hdr.sgml : 20031209 20031208183925 ACCESSION NUMBER: 0001047469-03-039763 CONFORMED SUBMISSION TYPE: N-CSR PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20030930 FILED AS OF DATE: 20031209 EFFECTIVENESS DATE: 20031209 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FIRST AMERICAN FUNDS INC CENTRAL INDEX KEY: 0000356134 IRS NUMBER: 411418224 STATE OF INCORPORATION: MN FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: N-CSR SEC ACT: 1940 Act SEC FILE NUMBER: 811-03313 FILM NUMBER: 031043316 BUSINESS ADDRESS: STREET 1: 800 NICOLLET MALL STREET 2: BC-MN-H210 CITY: MINNEAPOLIS STATE: MN ZIP: 55440-1330 BUSINESS PHONE: 6123031606 MAIL ADDRESS: STREET 1: 800 NICOLLET MALL STREET 2: BC-MN-H210 CITY: MINNEAPOLIS STATE: MN ZIP: 55402 FORMER COMPANY: FORMER CONFORMED NAME: FIRST AMERICAN MONEY FUND INC DATE OF NAME CHANGE: 19900603 N-CSR 1 a2122205zn-csr.txt N-CSR ----------------------------- OMB APPROVAL ----------------------------- OMB Number: 3235-0570 Expires: November 30, 2005 Estimated average burden hours per response....... 5.0 ----------------------------- 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 811-03313 --------------------------------------------- First American Funds, Inc. - ------------------------------------------------------------------------------- (Exact name of registrant as specified in charter) 800 Nicollet Mall Minneapolis, MN 55402 - ------------------------------------------------------------------------------- (Address of principal executive offices) (Zip code) Jonathan P. Lillemoen 800 Nicollet Mall Minneapolis, MN 55402 - ------------------------------------------------------------------------------- (Name and address of agent for service) Registrant's telephone number, including area code: 800-677-3863 ---------------------------- Date of fiscal year end: September 30, 2003 -------------------------- Date of reporting period: September 30, 2003 ------------------------- Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles. A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. Section 3507. Item 1. Report to Shareholders [GRAPHIC] CONFIDENTIAL DRAFT 11/6/2003 [FIRST AMERICAN FUNDS LOGO] 2003 ANNUAL REPORT MONEY MARKET FUNDS CLASS A, B, AND C SHARES "NOTHING BUT HARMONY, HONESTY, INDUSTRY, AND FRUGALITY ARE NECESSARY TO MAKE US A GREAT AND HAPPY PEOPLE." [PHOTO OF GEORGE WASHINGTON] GEORGE WASHINGTON JANUARY 29, 1789 FIRST AMERICAN FUNDS OUR IMAGE-GEORGE WASHINGTON HIS RICH LEGACY AS PATRIOT AND LEADER IS WIDELY RECOGNIZED AS EMBODYING THE SOUND JUDGMENT, RELIABILITY, AND STRATEGIC VISION THAT ARE CENTRAL TO OUR BRAND. FASHIONED IN A STYLE REMINISCENT OF AN 18TH CENTURY ENGRAVING, THE ILLUSTRATION CONVEYS THE SYMBOLIC STRENGTH AND VITALITY OF WASHINGTON, WHICH ARE ATTRIBUTES THAT WE VALUE AT FIRST AMERICAN FUNDS. TABLE OF CONTENTS Message to Shareholders 1 Report of Independent Auditors 2 Schedule of Investments 3 Statements of Assets and Liabilities 14 Statements of Operations 15 Statements of Changes in Net Assets 16 Financial Highlights 18 Notes to Financial Statements 26 Notice to Shareholders 31
AN INVESTMENT IN MONEY MARKET FUNDS IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENT AGENCY. ALTHOUGH THESE FUNDS SEEK TO PRESERVE THE VALUE OF YOUR INVESTMENT AT $1.00 PER SHARE, IT IS POSSIBLE TO LOSE MONEY BY INVESTING IN THESE FUNDS. NOT FDIC INSURED NO BANK GUARANTEE MAY LOSE VALUE MESSAGE TO SHAREHOLDERS November 14, 2003 DEAR SHAREHOLDERS: We invite you to take a few minutes to review the results of the fiscal year ended September 30, 2003. This report includes a complete listing of portfolio holdings and additional fund information. We hope you will find this helpful in monitoring your investment portfolio. Also, through our website firstamericanfunds.com, we provide quarterly performance fact sheets on all First American funds, the economic outlook as viewed by our senior investment officers, and other information about fund investments and portfolio strategies. Please contact your financial professional if you have questions about First American Funds or contact First American Investor Services at 800.677.FUND. We appreciate your investment with First American Funds and look forward to serving your financial needs in the future. Sincerely, /s/ Virginia L. Stringer /s/ Thomas S. Schreier, Jr. VIRGINIA L. STRINGER THOMAS S. SCHREIER, JR. CHAIRPERSON OF THE BOARD PRESIDENT FIRST AMERICAN FUNDS, INC. FIRST AMERICAN FUNDS, INC. 1 REPORT OF INDEPENDENT AUDITORS To the Shareholders and Board of Directors First American Funds, Inc. We have audited the accompanying statements of assets and liabilities, including the schedules of investments of First American Funds, Inc. (comprised of the Government Obligations, Prime Obligations, Tax Free Obligations, Treasury Obligations and Treasury Reserve Funds) (the "Funds") as of September 30, 2003, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the periods indicated therein, except as noted below. These financial statements and the financial highlights are the responsibility of the Funds' management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. The financial highlights of the Treasury Reserve Fund for the periods presented through October 31, 2000, were audited by other auditors whose reports dated December 29, 2000 and January 7, 2000, expressed unqualified opinions on those financial highlights. We conducted our audits in accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights. Our procedures included confirmation of securities owned as of September 30, 2003, by correspondence with the custodian and brokers. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights audited by us as referred to above, present fairly, in all material respects, the financial position of each of the respective funds constituting First American Funds, Inc. at September 30, 2003, and the results of their operations for the year then ended, the changes in their net assets for each of the two years in the period then ended, and their financial highlights for each of the periods indicated herein, in conformity with accounting principles generally accepted in the United States. /s/ ERNST & YOUNG LLP Minneapolis, Minnesota October 31, 2003 2 SCHEDULE OF INVESTMENTS September 30, 2003 GOVERNMENT OBLIGATIONS FUND
DESCRIPTION PAR (000) VALUE (000) - ------------------------------------------------------------------------------------ U.S. GOVERNMENT AGENCY OBLIGATIONS - 77.5% FAMC 3.850%, 04/15/04 $ 17,517 $ 17,758 FFCB 1.000%, 10/01/03 (a) 125,000 124,969 3.125%, 10/01/03 15,000 15,000 0.985%, 10/07/03 (a) 50,000 49,988 0.990%, 10/24/03 (a) 100,000 99,973 2.375%, 10/01/04 9,400 9,496 FHLB 0.970%, 10/06/03 (a) 75,000 74,967 1.060%, 10/07/03 100,000 99,983 1.000%, 10/08/03 100,000 99,979 1.000%, 10/11/03 (a) 80,000 79,979 5.440%, 10/15/03 1,000 1,002 1.036%, 10/24/03 100,000 99,934 0.985%, 10/25/03 (a) 100,000 99,968 1.164%, 10/28/03 (a) 100,000 99,970 1.500%, 11/04/03 13,860 13,861 3.125%, 11/14/03 36,500 36,556 3.180%, 12/03/03 60,275 60,439 3.270%, 02/12/04 37,750 38,007 1.125%, 02/24/04 10,000 9,992 1.250%, 04/15/04 15,000 14,995 3.750%, 04/15/04 17,530 17,762 4.875%, 04/16/04 29,845 30,429 1.400%, 05/14/04 9,000 9,000 1.250%, 06/01/04 25,000 25,000 3.375%, 06/15/04 15,000 15,227 1.035%, 07/23/04 25,000 24,974 4.625%, 08/13/04 3,310 3,409 6.250%, 08/13/04 5,730 5,981 1.250%, 09/22/04 9,675 9,675 FHLMC 3.250%, 01/15/04 45,000 45,227 3.400%, 02/20/04 26,950 27,158 1.230%, 02/26/04 10,000 9,950 6.950%, 04/01/04 10,000 10,278 3.750%, 04/15/04 40,510 41,054 1.020%, 05/20/04 25,000 24,834 1.000%, 06/02/04 25,000 24,832 1.133%, 07/15/04 20,000 19,821 3.000%, 07/15/04 28,160 28,597 1.328%, 08/12/04 20,000 19,770 1.245%, 09/09/04 20,000 19,765 FNMA 1.000%, 10/01/03 (a) 78,000 77,976 1.050%, 10/01/03 (a) 100,000 100,000 1.065%, 10/01/03 (a) 125,000 124,996 1.110%, 10/01/03 50,000 50,000 1.003%, 10/01/03 (a) 125,000 124,968 1.164%, 10/30/03 (a) 125,000 124,967 4.750%, 11/14/03 6,930 6,957 1.320%, 12/12/03 30,000 29,922 1.290%, 02/06/04 35,000 34,848 5.125%, 02/13/04 25,000 25,344 1.120%, 04/30/04 30,000 29,802 1.370%, 08/20/04 20,000 19,757 ------------ TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS (Cost $2,309,096) 2,309,096 ------------ REPURCHASE AGREEMENTS - 23.2% Goldman Sachs 1.090%, dated 9/30/03, matures 10/1/03, repurchase price $200,006,056 (collateralized by U.S. Treasury Obligations: Total Market Value $204,000,000) $ 200,000 $ 200,000 Lehman Brothers 1.050%, dated 9/30/03, matures 10/1/03, repurchase price $100,002,917 (collateralized by U.S. Government Obligations: Total Market Value $101,984,434) 100,000 100,000 Merrill Lynch 1.050%, dated 9/30/03, matures 10/1/03, repurchase price $250,007,292 (collateralized by U.S. Government Obligations: Total Market Value $255,002,488) 250,000 250,000 UBS Warburg 1.060%, dated 9/30/03, matures 10/1/03, repurchase price $143,306,219 (collateralized by U.S. Government Obligations: Total Market Value $146,169,943) 143,302 143,302 ------------ TOTAL REPURCHASE AGREEMENTS (Cost $693,302) 693,302 ------------ INVESTMENTS PURCHASED WITH PROCEEDS FROM SECURITIES LENDING - 4.4% REPURCHASE AGREEMENTS - 4.4% Deutsche Bank 1.23%, dated 9/30/03, matures 10/1/03, repurchase price $131,617,113 (collateralized by U.S. Government Obligations: Total Market Value $134,244,869) 131,613 131,613 ------------ TOTAL INVESTMENTS PURCHASED WITH PROCEEDS FROM SECURITIES LENDING (Cost $131,613) 131,613 ------------ TOTAL INVESTMENTS - 105.1% (Cost $3,134,011) 3,134,011 ------------ OTHER ASSETS AND LIABILITIES, NET - (5.1)% (152,879) ------------ TOTAL NET ASSETS - 100.0% $ 2,981,132 ------------
(a) Variable Rate Security - The rate shown is the rate in effect as of September 30, 2003. The date shown is the next reset date. FAMC - Federal Agriculture Mortgage Corporation FFCB - Federal Farm Credit Bank FHLB - Federal Home Loan Bank FHLMC - Federal Home Loan Mortgage Corporation FNMA - Federal National Mortgage Association 3 PRIME OBLIGATIONS FUND
DESCRIPTION PAR (000) VALUE (000) - ------------------------------------------------------------------------------------ COMMERCIAL PAPER - 32.1% BROKERAGE - 2.5% Citicorp Global Markets 1.050%, 10/01/03 $ 100,000 $ 100,000 1.050%, 10/02/03 75,000 74,998 1.050%, 10/07/03 75,000 74,987 1.051%, 10/23/03 75,000 74,952 CS First Boston USA 1.050%, 10/10/03 50,000 49,987 1.050%, 10/16/03 54,000 53,976 ------------ TOTAL BROKERAGE 428,900 ------------ COMMERCIAL FUNDING CORPORATIONS - 21.5% Asset Securitization Co-Op Corp 1.061%, 10/06/03 (a) 50,000 49,993 1.051%, 10/22/03 (a) 45,000 44,972 1.050%, 10/27/03 (a) 110,000 109,917 1.060%, 11/04/03 (a) 65,000 64,935 1.062%, 11/05/03 (a) 150,000 149,845 Corporate Asset Funding 1.061%, 10/02/03 (a) 25,000 24,999 1.070%, 10/03/03 (a) 100,000 99,994 1.070%, 10/08/03 (a) 75,000 74,984 1.060%, 10/14/03 (a) 102,800 102,761 1.050%, 10/21/03 (a) 65,000 64,962 1.061%, 10/22/03 (a) 58,995 58,959 Edison Asset Securitization 1.050%, 10/01/03 (a) 75,000 75,000 1.060%, 10/03/03 (a) 49,686 49,683 1.050%, 10/20/03 (a) 10,000 9,994 1.052%, 11/14/03 (a) 145,088 144,902 1.060%, 12/05/03 (a) 74,600 74,457 Fleet Funding 1.060%, 10/06/03 (a) 61,563 61,554 1.050%, 10/07/03 (a) 65,181 65,170 1.050%, 10/10/03 (a) 40,095 40,085 1.051%, 10/17/03 (a) 37,379 37,362 1.051%, 10/21/03 (a) 45,884 45,857 1.051%, 10/22/03 (a) 50,000 49,969 Jupiter Securitization 1.060%, 10/02/03 (a) 50,000 49,999 1.070%, 10/08/03 (a) 75,000 74,984 1.050%, 10/10/03 (a) 50,000 49,987 1.050%, 10/14/03 (a) 40,000 39,985 1.055%, 10/17/03 (a) 46,410 46,388 1.055%, 10/20/03 (a) 105,000 104,942 1.051%, 10/22/03 (a) 100,000 99,939 Moat Funding (Guarantor: 26% JPM Chase) 1.060%, 10/16/03 (a) 50,000 49,978 1.060%, 10/17/03 (a) 50,000 49,976 1.050%, 10/20/03 (a) 100,000 99,945 1.104%, 01/14/04 (a) 100,000 99,679 1.100%, 01/15/04 (a) 50,000 49,838 1.104%, 01/16/04 (a) 100,000 99,673 Receivables Capital Corp 1.050%, 10/08/03 (a) 149,254 149,223 1.061%, 10/15/03 (a) 75,000 74,969 1.050%, 10/16/03 (a) 100,000 99,956 Sheffield Receivables 1.061%, 10/15/03 (a) 180,710 180,636 1.051%, 10/17/03 (a) 138,600 138,535 1.050%, 10/21/03 (a) 75,000 74,956 1.051%, 10/24/03 (a) 74,156 74,106 Yorktown Capital 1.050%, 10/09/03 (a) $ 50,008 $ 49,996 1.051%, 10/17/03 (a) 31,708 31,693 1.051%, 10/20/03 (a) 204,706 204,593 1.051%, 10/21/03 (a) 80,044 79,997 1.051%, 10/22/03 (a) 50,000 49,969 1.050%, 10/27/03 (a) 60,043 59,997 ------------ TOTAL COMMERCIAL FUNDING CORPORATIONS 3,684,293 ------------ DIVERSIFIED FINANCIALS - 0.6% General Electric Capital Corp 1.050%, 10/07/03 100,000 99,982 ------------ TOTAL DIVERSIFIED FINANCIALS 99,982 ------------ DOMESTIC BANKS - 4.1% Kitty Hawk Funding (Guarantor: Bank of America) 1.060%, 10/07/03 (a) 136,834 136,810 1.050%, 10/23/03 (a) 150,000 149,904 Variable Funding Capital (Guarantor: Wachovia) 1.060%, 10/07/03 (a) 100,000 99,982 1.060%, 10/09/03 (a) 50,000 49,988 1.050%, 10/10/03 (a) 50,000 49,987 1.061%, 10/15/03 (a) 25,000 24,990 1.051%, 10/16/03 (a) 50,000 49,978 1.050%, 10/21/03 (a) 100,000 99,942 1.062%, 11/17/03 (a) 35,000 34,952 ------------ TOTAL DOMESTIC BANKS 696,533 ------------ RETAIL FUNDING CORPORATION - 3.4% Emerald Certificates (MBNA Master Certificates) (Secured Liquidity Note) 1.050%, 10/01/03 (a) 150,000 150,000 1.060%, 10/08/03 (a) 29,263 29,257 1.081%, 10/08/03 (a) 100,000 99,979 1.070%, 10/09/03 (a) 30,000 29,993 1.070%, 10/09/03 (a) 75,000 74,982 1.080%, 10/14/03 (a) 50,000 49,981 1.080%, 10/30/03 (a) 38,000 37,967 Bishops Gate Residential 1.070%, 10/31/03 100,000 99,911 ------------ TOTAL RETAIL FUNDING CORPORATION 572,070 ------------ TOTAL COMMERCIAL PAPER (Cost $5,481,778) 5,481,778 ------------ CORPORATE OBLIGATIONS - 32.6% BROKERAGE - 5.2% CS First Boston USA 1.400%, 10/01/03 (b) 40,000 40,037 1.130%, 10/05/03 (b) 50,000 50,004 Goldman Sachs Group 1.150%, 10/15/03 (a) (b) 150,000 150,000 1.356%, 10/15/03 (a) (b) 88,000 88,000 Merrill Lynch 1.490%, 10/01/03 (b) 54,000 54,108 1.160%, 11/18/03 (b) 100,000 100,000 Morgan Stanley Dean Witter 1.143%, 10/01/03 (b) 142,000 142,000 1.240%, 10/15/03 (b) 250,000 250,000 Salomon Smith Barney 7.200%, 02/01/04 15,950 16,258 ------------ TOTAL BROKERAGE 890,407 ------------ DIVERSIFIED FINANCIALS - 3.6% American Express Credit 1.140%, 10/20/03 (a) (b) 90,000 89,987 Associates First Capital 1.240%, 12/26/03 (a) (b) 120,000 120,000
The accompanying notes are an integral part of the financial statements. 4
DESCRIPTION PAR (000) VALUE (000) - ------------------------------------------------------------------------------------ General Electric Capital Corp 1.200%, 10/09/03 (b) $ 200,000 $ 200,000 1.150%, 10/17/03 (b) 200,000 200,000 ------------ TOTAL DIVERSIFIED FINANCIALS 609,987 ------------ FOREIGN FUNDING CORPORATIONS - 13.1% Beta Finance 1.090%, 10/01/03 (a) (b) 125,000 124,996 1.540%, 11/10/03 (a) 50,000 50,000 1.600%, 11/21/03 (a) 50,000 50,000 1.450%, 08/18/04 (a) 107,000 107,000 Centauri (CC USA LLC) 1.055%, 10/01/03 (a) (b) 30,000 29,995 1.080%, 10/01/03 (a) (b) 25,000 25,000 1.080%, 10/01/03 (a) (b) 102,000 101,997 1.080%, 10/01/03 (a) (b) 50,000 49,998 1.208%, 10/01/03 (a) (b) 50,000 49,999 1.930%, 10/22/03 (a) 50,000 50,000 1.910%, 10/28/03 (a) 50,000 50,000 1.515%, 11/19/03 (a) 75,000 75,000 1.150%, 07/26/04 (a) 50,000 50,000 Dorada Finance 1.063%, 10/01/03 (a) (b) 75,000 74,994 1.090%, 10/01/03 (a) (b) 150,000 149,995 1.750%, 10/16/03 (a) 50,000 50,000 1.450%, 01/20/04 (a) 50,000 50,000 K2 USA LLC 1.070%, 10/01/03 (a) (b) 50,000 49,991 1.070%, 10/01/03 (a) (b) 75,000 74,986 1.213%, 10/01/03 (a) (b) 100,000 100,055 1.940%, 10/10/03 (a) 50,000 50,000 1.550%, 11/10/03 (a) 75,000 75,000 1.440%, 09/02/04 (a) 50,000 50,000 1.235%, 09/22/04 (a) 75,000 74,989 Sigma Finance 1.060%, 10/01/03 (a) (b) 50,000 49,993 1.065%, 10/01/03 (a) (b) 50,000 49,995 1.078%, 10/01/03 (a) (b) 100,000 99,995 1.080%, 10/01/03 (a) (b) 100,000 99,996 1.080%, 10/01/03 (a) (b) 65,000 64,999 1.090%, 10/01/03 (a) (b) 50,000 49,998 1.090%, 10/01/03 (a) (b) 85,000 84,997 1.310%, 10/01/03 (a) (b) 50,000 50,010 1.893%, 10/23/03 (a) 75,000 75,000 ------------ TOTAL FOREIGN FUNDING CORPORATIONS 2,238,978 ------------ INSURANCE - 7.1% AI Life Funding Agreement 1.210%, 10/01/03 (b) 75,000 75,000 1.210%, 10/01/03 (b) 100,000 100,000 AIG Life Funding Agreement 1.230%, 10/01/03 (b) 100,000 100,000 1.230%, 10/01/03 (b) 100,000 100,000 Allstate Life Insurance Funding Agreement 1.250%, 10/01/03 (b) 100,000 100,000 1.306%, 10/15/03 (b) 100,000 100,000 Anchor National Life Funding Agreement 1.250%, 10/01/03 (b) 75,000 75,000 Metlife Global Funding 1.130%, 10/28/03 (a) (b) 95,000 95,000 Sun Life Insurance Funding Agreement 1.370%, 10/01/03 (b) 75,000 75,000 Transamerica Occidental Funding Agreement 1.270%, 10/01/03 (b) 400,000 400,000 ------------ TOTAL INSURANCE 1,220,000 ------------ OTHER - 3.0% 3M 5.674%, 12/12/03 (a) $ 200,000 $ 201,614 Merck & Co. Inc. 4.489%, 02/22/04 (a) 200,000 202,535 Wal-Mart Stores 5.199%, 06/01/04 100,000 102,713 ------------ TOTAL OTHER 506,862 ------------ TELECOMMUNICATION SERVICES - 0.6% Bellsouth Telecom 1.180%, 12/04/03 (b) 100,000 100,000 ------------ TOTAL CORPORATE OBLIGATIONS (Cost $5,566,234) 5,566,234 ------------ CERTIFICATES OF DEPOSIT - 5.8% American Express Centurian 1.050%, 10/14/03 100,000 100,000 1.050%, 10/17/03 85,000 85,000 1.050%, 10/20/03 100,000 100,000 Bank One 1.160%, 11/10/03 50,000 50,001 LaSalle Bank 1.050%, 10/14/03 100,000 100,000 1.050%, 11/10/03 100,000 100,000 Wells Fargo Bank 1.050%, 10/06/03 115,000 115,000 1.060%, 10/10/03 150,000 150,000 1.060%, 10/10/03 120,000 120,000 1.060%, 10/17/03 80,000 80,000 ------------ TOTAL CERTIFICATES OF DEPOSIT (Cost $1,000,001) 1,000,001 ------------ YANKEE CERTIFICATES OF DEPOSIT - 19.5% Bayerische Landesbank NY 1.620%, 12/02/03 50,000 50,000 2.920%, 12/08/03 200,000 200,476 5.000%, 07/20/04 15,000 15,475 BNP Paribas NY 1.050%, 06/16/04 195,000 194,941 Canadian Imperial Bank NY 1.050%, 10/17/03 300,000 300,000 Canadian Imperial Bank NY 1.060%, 10/10/03 110,000 110,000 Credit Agricole NY 1.230%, 08/04/04 50,000 49,996 Danske Bank NY 1.060%, 10/08/03 100,000 100,000 1.540%, 12/19/03 50,000 50,024 1.250%, 09/10/04 100,000 99,990 Dexia NY 1.065%, 10/06/03 150,000 150,000 Fortis Banque 1.050%, 10/24/03 300,000 300,000 KBC NY 1.050%, 10/30/03 200,000 200,000 1.060%, 12/10/03 100,000 100,000 Landesbank Wuerttemburg NY 1.410%, 02/03/04 50,000 50,010 Nordeutche Bank NY 1.100%, 07/06/04 100,000 100,000 1.110%, 07/12/04 50,000 49,996 Rabobank Nederland NY 1.400%, 01/20/04 95,000 95,017 1.240%, 08/04/04 48,000 47,996
5
DESCRIPTION PAR (000) VALUE (000) - ------------------------------------------------------------------------------------ Royal Bank of Scotland NY 1.930%, 11/04/03 $ 50,000 $ 50,011 1.295%, 04/16/04 50,000 49,999 1.305%, 04/16/04 50,000 50,000 Societe Generale NY 1.050%, 11/03/03 150,000 150,000 Svenska Handelsbanken NY 1.060%, 10/03/03 100,000 100,000 1.060%, 10/09/03 20,000 20,000 1.060%, 10/09/03 100,000 100,000 1.050%, 11/07/03 50,000 50,000 1.280%, 03/18/04 50,000 50,000 1.310%, 03/29/04 50,000 50,000 West Deutsche Landesbank NY 1.240%, 03/17/04 100,000 99,995 1.320%, 04/15/04 100,000 99,995 1.200%, 08/02/04 50,000 50,000 1.390%, 08/26/04 75,000 74,993 1.250%, 09/20/04 75,000 75,000 ------------ TOTAL YANKEE CERTIFICATES OF DEPOSIT (Cost $3,333,914) 3,333,914 ------------ EURO TIME DEPOSITS - 0.1% National City Time Deposit 1.094%, 10/01/03 14,245 14,245 ------------ TOTAL EURO TIME DEPOSITS (Cost $14,245) 14,245 ------------ REPURCHASE AGREEMENTS - 6.3% Bear Stearns 1.440%, dated 9/30/03, matures 10/1/03, repurchase price $400,016,000 (collateralized by various securities: Total Market Value $410,508,943) 400,000 400,000 UBS Warburg 0.960%, dated 9/30/03, matures 10/1/03, repurchase price $473,377,623 (collateralized by U.S. Treasury Obligations: Total Market Value $482,836,674) 473,365 473,365 UBS Warburg 1.060%, dated 9/30/03, matures 10/1/03, repurchase price $206,704,086 (collateralized by U.S. Government Obligations: Total Market Value $210,836,362) 206,698 206,698 ------------ TOTAL REPURCHASE AGREEMENTS (Cost $1,080,063) 1,080,063 ------------ U.S. GOVERNMENT AGENCY OBLIGATIONS - 3.4% FHLB 3.375%, 06/15/04 40,000 40,606 FHLMC 1.030%, 04/02/04 23,850 23,725 3.750%, 04/15/04 55,400 56,194 1.020%, 05/20/04 35,785 35,550 6.250%, 07/15/04 49,282 51,223 1.400%, 08/11/04 30,000 30,000 1.328%, 08/12/04 50,000 49,425 FNMA 1.110%, 10/01/03 130,000 130,000 1.120%, 04/30/04 65,000 64,571 0.995%, 05/28/04 50,000 49,668 3.500%, 09/15/04 $ 19,500 $ 19,879 1.500%, 09/27/04 35,000 35,000 ------------ TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS (Cost $585,841) 585,841 ------------ TOTAL INVESTMENTS - 99.8% (Cost $17,062,076) 17,062,076 ------------ OTHER ASSETS AND LIABILITIES, NET - 0.2% 29,084 ------------ TOTAL NET ASSETS - 100.0% $ 17,091,160 ------------
(a) Security sold within the terms of a private placement memorandum, exempt from registration under Rule 144A of the Securities Act of 1933, as amended, and may be sold only to dealers in that program or other "qualified institutional buyers." These securities have been determined to be liquid under the guidelines established by the Funds' board of directors. As of September 30, 2003, the value of these investments was $7,487,607,185 or 43.8% of total net assets. (b) Variable Rate Security - The rate shown is the rate in effect as of September 30, 2003. The date shown is the next reset date. FHLB - Federal Home Loan Bank FHLMC - Federal Home Loan Mortgage Corporation FNMA - Federal National Mortgage Association The accompanying notes are an integral part of the financial statements. 6 TAX FREE OBLIGATIONS FUND
DESCRIPTION PAR (000) VALUE (000) - ------------------------------------------------------------------------------------ MUNICIPAL BONDS - 101.2% ARIZONA - 2.0% Pima County Development Senior Living Authority (LOC: LaSalle Bank) 1.100%, 10/07/03 (a) $ 16,650 $ 16,650 Tempe Industrial Development Authority, Friendship Village Project Series C (LOC: LaSalle Bank) 1.100%, 10/07/03 (a) 10,000 10,000 ------------ 26,650 ------------ CALIFORNIA - 0.3% Los Angeles School District, Belmont Learning Complex A (LOC: Bank of New York) 1.070%, 10/07/03 (a) 75 75 Santa Barbara Tax and Revenue Anticipation Notes - Series A 2.000%, 07/23/04 4,000 4,038 ------------ 4,113 ------------ COLORADO - 3.5% Boulder Valley School District (GO) 1.500%, 06/30/04 10,000 10,040 2.000%, 06/30/04 10,000 10,077 Colorado General Fund Tax and Anticipation Notes Revenue 2.000%, 06/25/04 15,000 15,123 Colorado Health Facilities Authority Bethesda Living (LOC: LaSalle Bank) 1.10%, 10/07/03 (a) 2,955 2,955 Moffat County Pollution Control (INS: AMBAC) 1.200%, 10/07/03 (a) 10,465 10,465 ------------ 48,660 ------------ CONNECTICUT - 1.3% Connecticut Health & Educational Facilities Authority, Yale University 0.800%, 10/01/03 (a) 2,300 2,300 Connecticut Special Tax Obligation Revenue (INS: AMBAC) 1.07%, 10/07/03 (a) 14,960 14,960 ------------ 17,260 ------------ FLORIDA - 4.1% Florida Gulf Coast University (LOC: First Union) 1.12%, 10/07/03 (a) 6,615 6,615 Florida Housing Agency (LOC: Kreidetbank) 1.070%, 10/07/03 (a) (b) 6,035 6,035 Florida Municipal Power Agency (CP) 0.860%, 10/01/03 12,271 12,271 1.100%, 10/02/03 6,077 6,077 0.850%, 11/03/03 13,776 13,776 Miami-Dade County Development Authority, Gulliver School Project (LOC: Bank of America) 1.150%, 10/07/03 (a) 2,000 2,000 Palm Beach County Revenue, Benjamin Private School Project (LOC: Bank of America) 1.10%, 10/07/03 (a) 2,000 2,000 University Athletic Association, University of Florida Stadium Project (LOC: Suntrust) 1.230%, 10/01/03 (a) 1,200 1,200 University of Florida Research Funding Revenue (LOC: Wachovia Bank) 1.120%, 10/07/03 (a) $ 5,000 $ 5,000 University of South Florida Funding (LOC: First Union) 1.100%, 10/07/03 (a) 930 930 ------------ 55,904 ------------ GEORGIA - 0.6% Athens-Clarke County University Government Development Authority, University of Georgia Athletic Association Project (LOC: Bank of America) 1.220%, 10/01/03 (a) 1,400 1,400 Dalton Development Authority Revenue, Hamilton Health System Project (LOC: Bank of America) 1.10%, 10/07/03 (a) 5,000 5,000 Fulton County Development Authority, Pace Academy Project (LOC: Bank of America) 1.100%, 10/07/03 (a) 1,925 1,925 ------------ 8,325 ------------ HAWAII - 0.2% Hawaii Department of Budget & Finance, Kahla Nui Project (LOC: LaSalle Bank) 1.10%, 10/07/03 (a) 3,000 3,000 ------------ IDAHO - 0.7% Boise Idaho Urban Renewal Agency, Capital City (LOC: Bank America) 1.130%, 10/07/03 (a) 5,110 5,110 University of Idaho Foundation Authority (LOC: First Security Bank) 1.130%, 10/07/03 (a) (b) 4,880 4,880 ------------ 9,990 ------------ ILLINOIS - 17.3% ABN AMRO Munitops Certificates Trust, Chicago IL (INS:FGIC) 1.180%, 10/07/03 (a) (b) 20,000 20,000 ABN AMRO Munitops Certificates Trust, llinois State (GO) (INS: MBIA) 1.180%, 10/07/03 (a) (b) 4,575 4,575 Chicago Illinois Mandatory Put 12/4/03 @ 100 (LOC: Landesbank - Hessen-THRGN) 1.280%, 1/08/04 12,000 12,000 Chicago Illinois Park District 1.750%, 05/01/04 12,000 12,063 Cook County Illinois (SPA: Landesbank Hessen-THRGN) 1.040%, 10/07/03 (a) 42,250 42,250 Cook County Illinois Revenue - Claretian Project (LOC: FHLB) 1.100%, 10/07/03 (a) 3,395 3,395 Illinois Development Finance Authority (LOC: FHLB) 1.220%, 10/07/03 (a) 4,800 4,800 Illinois Development Finance Authority (LOC: Northern Trust) 1.150%, 10/07/03 (a) 4,000 4,000 Illinois Development Finance Authority Aurora (LOC: Allied Irish) 1.350%, 10/07/03 (a) 6,740 6,740
7
DESCRIPTION PAR (000) VALUE (000) - ------------------------------------------------------------------------------------ Illinois Development Finance Authority Lake Forest (LOC: Northern Trust) 1.100%, 10/07/03 (a) $ 6,255 $ 6,255 Illinois Development Finance Authority Loyola Academy (LOC: Bank One) 1.100%, 10/07/03 (a) 4,000 4,000 Illinois Development Finance Authority McCormick Theological (LOC: Northern Trust) 1.100%, 10/07/03 (a) 7,935 7,935 Illinois Development Finance Authority Roosevelt University (LOC: American National Bank) 1.100%, 10/07/03 (a) 7,500 7,500 Illinois Development Finance Authority St. Ignatius (LOC: Northern Trust) 1.100%, 10/07/03 (a) 9,800 9,800 Illinois Development Finance Authority St. Pauls Housing (LOC: LaSalle Bank) 1.100%, 10/07/03 (a) 4,440 4,440 Illinois Development Finance Authority, Chinese American Service Project (LOC: LaSalle Bank) 1.140%, 10/07/03 (a) 5,000 5,000 Illinois Development Finance Authority, Solomon Schechter Day School (LOC: LaSalle Bank) 1.140%, 10/07/03 (a) 5,000 5,000 Illinois Development Finance Authority, United Way/Crusade Mercy (LOC: LaSalle Bank) 1.140%, 10/07/03 (a) 4,935 4,935 Illinois Development Financial Authority, Mount Carmel High School Project (LOC: Bank One) 1.100%, 10/07/03 (a) 2,800 2,800 Illinois Educational Facilities Authority Chicago Zoological Society (LOC: Northern Trust) 1.100%, 10/07/03 (a) 5,000 5,000 Illinois Health Facilities Authorities Edgewater Hospital 1.120%, 10/07/03 (a) (b) 10,600 10,600 Illinois Health Facilities Authority Lifelink (LOC: American National Bank) 1.150%, 10/07/03 (a) 7,225 7,225 Illinois State Toll Highway Authority (INS: FSA) (SPA: Landesbank - Hessen-THRGN) 1.100%, 10/07/03 (a) 18,500 18,500 1.100%, 10/07/03 (a) 13,100 13,100 Macon County - Milikin University (INS: AMBAC) (SPA: Bank One) 1.100%, 10/07/03 (a) 4,400 4,400 Northern Cook County Illinois Solid Waste Agency (LOC: Northern Trust) 1.100%, 10/07/03 (a) 5,900 5,900 State of Illinois (GO) 5.000%, 04/01/04 5,000 5,097 ------------ 237,310 ------------ INDIANA - 1.6% Evansville Economic Development Authority (LOC: Citibank) 1.050%, 10/07/03 (a) (b) 2,500 2,500 Indiana Health Facilities Finance Authority Henry County Memorial Hospital (LOC: Fifth Third) 1.160%, 10/07/03 (a) $ 19,685 $ 19,685 ------------ 22,185 ------------ IOWA - 0.3% Iowa Financial Retirement Authority, Wesley Retirement Services (LOC: Wells Fargo Bank) 1.160%, 10/07/03 (a) 4,000 4,000 ------------ KANSAS - 0.7% Prairie Village Revenue, Claridge Court (LOC: LaSalle Bank) 1.110%, 10/07/03 (a) 9,410 9,410 ------------ LOUISIANA - 4.7% State of Louisiana (CP) 0.880%, 11/17/03 30,000 30,000 0.890%, 11/17/03 35,000 35,000 ------------ 65,000 ------------ MASSACHUSETTS - 3.8% State of Massachusetts Series C (GO) (SPA: State Street B&T) 1.120%, 10/07/03 (a) 24,725 24,725 State of Massachusetts Series B (SPA: Landesbank - Hessen - THRGN) (GO) 1.120%, 10/07/03 (a) 27,495 27,495 ------------ 52,220 ------------ MICHIGAN - 6.2% Hannahville Indian Community Finance - Series A (LOC: National City) 1.14%, 10/07/03 (a) (b) 1,450 1,450 Michigan State Housing Development Authority (INS: MBIA) (SPA: Merrill Lynch Cap Services) 1.130%, 10/07/03 (a) (b) 5,680 5,680 State of Michigan (CP) 0.950%, 10/14/03 15,000 15,000 0.950%, 10/14/03 30,080 30,080 State of Michigan Strategic Fund, Lutheran Social Services (LOC: National City Bank) 1.140%, 10/07/03 (a) 19,195 19,195 Wayne Charter County (LOC: Allied Irish, PLC) 1.140%, 10/07/03 (a) 13,825 13,825 ------------ 85,230 ------------ MINNESOTA - 4.7% Eden Prairie, Multifamily Housing Authority (Liquidity: Freddie Mac) 1.150%, 10/07/03 (a) 13,600 13,600 Mendota Heights Revenue, St. Thomas Academy Project (LOC: Allied Irish PLC) 1.150%, 10/07/03 (a) 1,960 1,960 Minneapolis School District Credit Support: SD Credit Program (GO) 2.000%, 08/6/04 10,000 10,088
The accompanying notes are an integral part of the financial statements. 8
DESCRIPTION PAR (000) VALUE (000) - ------------------------------------------------------------------------------------ Minnesota State Higher Educational Facilities Bethel College Credit Support: GO of Institution (LOC: Allied Irish Bank, PLC) 1.350%, 10/07/03 (a) $ 3,585 $ 3,585 University of Minnesota (GO of University) Series A 1.120%, 10/07/03 (a) 35,065 35,065 ------------ 64,298 ------------ MISSOURI - 1.2% Jackson County Missouri Industrial Development Authority, YMCA Greater Kansas City (LOC: Bank of America) 1.150%, 10/07/03 (a) 7,000 7,000 Missouri State Health & Educational Facilities (LOC: Bank One) (INS: AMBAC) 1.150%, 10/07/03 (a) 9,655 9,655 ------------ 16,655 ------------ MONTANA - 0.8% Montana State Health Facilities Authority 1.220%, 10/07/03 (a) (b) 11,250 11,250 ------------ NEVADA - 1.3% ABN AMRO Munitops Certificates Trust, Nevada State (GO) (INS: MBIA) 1.180%, 10/07/03 (a) (b) 8,500 8,500 Clark County School District (GO) (INS: FGIC) 3.000%, 06/01/04 8,720 8,842 ------------ 17,342 ------------ NEW HAMPSHIRE - 0.4% New Hampshire Health & Education Facilities Authority, Colby-Sawyer College (LOC: Allied Irish PLC) 1.070%, 10/07/03 (a) 5,500 5,500 ------------ NEW JERSEY - 0.7% State of New Jersey 2.000%, 06/25/04 10,000 10,071 ------------ NEW YORK - 1.9% New York City Transitional Financial Authority (SPA: Bank of New York) 1.230%, 10/01/03 (a) 7,700 7,700 New York, NY (GO) (SPA: Lehman Liquidity) (Credit: CIFG-TRS) 1.120%, 10/07/03 (a) (b) 14,825 14,825 Yonkers (GO) (LOC: Bank of New York) 2.000%, 05/14/04 3,000 3,019 ------------ 25,544 ------------ NORTH CAROLINA - 1.0% Mecklenburg County (GO) (Liquidity: Bank of America) 1.100%, 10/07/03 (a) 5,300 5,300 North Carolina Financial Agency Revenue, Greensboro College Project (LOC: Bank of America) 1.100%, 10/07/03 (a) 7,800 7,800 ------------ 13,100 ------------ OHIO - 5.2% ABN AMRO Munitops Certificates Trust, Westerville Ohio County School (INS: MBIA) (SPA: ABN AMRO Bank) 1.130%, 10/07/03 (a) (b) $ 4,000 $ 4,000 Cuyahoga County Ohio Hospital Revenue, University Hospital (INS: AMBAC) (SPA: Chase Manhattan) 1.100%, 10/07/03 (a) 3,000 3,000 Franklin County Health Care Facilities Revenue, Mother Angeline McCrory Project (LOC: Allied Irish Bank, PLC) 1.130%, 10/07/03 (a) 16,690 16,690 Franklin County Ohio Health Care Facilities (LOC: National City Bank) 1.150%, 10/07/03 (a) 3,900 3,900 Hamilton County Hospital Facilities Revenue, Elizabeth Gamle Series C (LOC: JP Morgan Chase) 1.100%, 10/07/03 (a) 3,300 3,300 Logan County Ohio Healthcare Facilities (LOC: Fifth Third Bank) 1.180%, 10/07/03 (a) 10,800 10,800 Miami County Hospital (LOC: National Australia Bank, NY) (SPA: Merrill Lynch Cap SVCS) 1.220%, 10/07/03 (a) (b) 4,740 4,740 Middleburg Heights Hospital Improvement Revenue (LOC: Keybank) 1.140%, 10/07/03 (a) 2,400 2,400 Ohio State Air Quality Development Authority, Ohio Power (INS: AMBAC) (Liquidity: Merrill Lynch SVCS) 1.130%, 10/07/03 (a) (b) 4,700 4,700 Ohio State Higher Education Facilities, Lake Erie (LOC: Fifth Third Bank) 1.140%, 10/07/03 (a) 12,665 12,665 Ohio State University General Receipts 1.010%, 10/07/03 (a) 45 45 Summit County Ohio Port Authority, Summa Health Systems Hospital (LOC: Fifth Third Bank) 1.140%, 10/07/03 (a) 5,000 5,000 ------------ 71,240 ------------ OKLAHOMA - 1.7% Oklahoma Authority Revenue, American Cancer Society Project (LOC: Bank of America) 1.150%, 10/07/03 (a) 2,905 2,905 Tulsa Industrial Authority Revenue Floating 1.130%, 10/07/03 (a) (b) 7,970 7,970 Tulsa Industrial Authority University of Tulsa (INS: MBIA) (SPA: Credit Local DeFrance) 1.070%, 10/07/03 (a) 12,075 12,075 ------------ 22,950 ------------ PENNSYLVANIA - 1.5% Philadelphia, PA Tax and Revenue Anticipation Notes 2.000%, 06/30/04 17,000 17,127 State of Pennsylvania (GO) (INS: AMBAC) 5.125%, 03/15/04 3,660 3,728 ------------ 20,855 ------------
9
DESCRIPTION PAR (000) VALUE (000) - ------------------------------------------------------------------------------------ RHODE ISLAND - 0.5% Rhode Island Health & Education Revenue, Jewish Services Agency (LOC: Sovereign Bank) (LOC: Bank of New York) 1.100%, 10/07/03 (a) $ 6,750 $ 6,750 ------------ SOUTH CAROLINA - 2.6% ABN AMRO Munitops Certificates Trust, South Carolina Transportation Infrastructure (INS: AMBAC) (SPA: ABN AMRO Bank) 1.180%, 10/07/03 (a) (b) 10,000 10,000 South Carolina Jobs Economic Development Authority - Boros & Chaplin Business Park (LOC: Bank of America) 1.150%, 10/07/03 (a) 11,000 11,000 University of South Carolina Revenue 1.750%, 07/24/04 15,000 15,104 ------------ 36,104 ------------ TENNESSEE - 5.3% Clarksville Tennessee Public Building Authority (LOC: Bank America) 1.100%, 10/07/03 (a) (b) 12,100 12,100 Met Government Nashville & Davidson (LOC: Societe Generale) 1.150%, 10/07/03 (a) (b) 7,035 7,035 Rutherford County Industrial Development - Square D Company (LOC: Societe Generale) 1.100%, 10/07/03 (a) 4,100 4,100 Shelby County Health (CP) 0.930%, 10/15/03 5,500 5,500 1.000%, 10/29/03 32,000 32,000 Memphis TN (CP) 0.850%, 10/06/03 12,500 12,500 ------------ 73,235 ------------ TEXAS - 15.3% ABN AMRO Munitops Certificates Trust, Comal Texas (Credit: PSF-GTD) (SPA: ABN AMRO Bank) 1.180%, 10/07/03 (a) (b) 10,002 10,002 ABN AMRO Munitops Certificates Trust, Frisco Texas School District (Credit: PSF-GTD) (SPA: ABN AMRO Bank) 1.200%, 05/12/04 (b) 9,695 9,695 ABN AMRO Munitops Certificates Trust, Irving Texas (Credit: PSF-GTD) (SPA: ABN AMRO Bank) 1.220%, 03/24/04 (b) 11,390 11,390 ABN AMRO Munitops Certificates Trust, Williamson County Texas (INS: FSA) (SPA: ABN AMRO Bank) 1.180%, 10/07/03 (a) (b) 10,395 10,395 Galena Park Independent School District (GTY: TXPSF) 1.130%, 10/07/03 (a) (b) 20,965 20,965 Kendall County Texas Health Facilities, Morningside Ministries (LOC: Bank One) 1.170%, 10/07/03 (a) 15,000 15,000 Northeast Independent School District (Credit: PSF-GTD) (Liquidity: Societe Generale) 1.130%, 10/07/03 (a) (b) 26,515 26,515 San Antonio Electric & Gas (INS: MBIA) 1.130%, 10/07/03 (a) (b) $ 7,455 $ 7,455 State of Texas 2.000%, 08/31/04 45,000 45,352 University of Texas (CP) 0.870%, 10/20/03 18,890 18,890 0.850%, 12/01/03 24,672 24,672 0.900%, 01/08/04 10,000 10,000 ------------ 210,331 ------------ VIRGINIA - 0.7% Spotsylvania County Industrial Development (LOC: First Union National Bank) 1.050%, 10/07/03 (a) 6,940 6,940 Williamsburg Development Authority Revenue (LOC: First Union National Bank) 1.050%, 10/07/03 (a) 2,150 2,150 ------------ 9,090 ------------ WASHINGTON - 3.9% ABN AMRO Munitops Certificates Trust, Washington State (GO) (INS: MBIA-IBC) (SPA: ABN AMRO Bank) 1.180%, 10/07/03 (a) (b) 14,000 14,000 Everett Public Facilities (CP) 0.990%, 05/21/04 6,240 6,240 Washington State Health Care Facilities Authority (INS: MBIA) (SPA: Lehman Liquidity) 1.170%, 10/07/03 (a) (b) 14,000 14,000 Washington State Housing Finance Commission (LOC: KeyBank) 1.100%, 10/07/03 (a) 4,945 4,945 Washington State Housing Finance Commission (LOC: Federal Home Loan) 1.070%, 10/07/03 (a) 2,870 2,870 Washington State Housing Finance Commission (LOC: Keybank) 1.100%, 10/07/03 (a) 4,945 4,945 Washington State Housing Financial Nonprofit Revenue, Open Window School Project (LOC: Bank of America) 1.150%, 10/07/03 (a) 6,600 6,600 ------------ 53,600 ------------ WEST VIRGINIA - 0.3% Monongalia County West Virginia General Hospital - A (LOC: Bank One) 1.170%, 10/07/03 (a) 4,700 4,700 ------------ WISCONSIN - 1.6% Wisconsin State Health & Education Facilities (LOC: Marshall & Illsley) 1.150%, 10/07/03 (a) 13,800 13,800 Wisconsin State Health Marshfield (LOC: Morgan Guaranty) 1.100%, 10/07/03 (a) 8,000 8,000 ------------ 21,800 ------------ WYOMING - 0.2% Kemmerer Pollution Control, Exxon Project 1.110%, 10/01/03 (a) 2,300 2,300 ------------ MULTISTATE - 3.1% Clipper Tax Exempt Trust (SPA: State Street) 1.330%, 10/07/03 (a) (b) 27,400 27,400
The accompanying notes are an integral part of the financial statements. 10
DESCRIPTION SHARES/PAR (000) VALUE (000) - ------------------------------------------------------------------------------------- Clipper Tax-Exempt Trust 1.280%, 10/07/03 (a) (b) $ 15,000 $ 15,000 ------------ 42,400 ------------ TOTAL MUNICIPAL BONDS (Cost $1,388,372) 1,388,372 ------------ MONEY MARKET FUNDS - 0.1% AIM Tax Free Investments Company 319,689 320 Money Market Obligations Trust 921,181 921 ------------ TOTAL MONEY MARKET FUNDS (Cost $1,241) 1,241 ------------ TOTAL INVESTMENTS - 101.3% (Cost $1,389,613) 1,389,613 ------------ OTHER ASSETS AND LIABILITIES, NET - (1.3)% (17,339) ------------ TOTAL NET ASSETS - 100.0% $ 1,372,274 ------------
(a) Variable Rate Security - The rate shown is the rate in effect as of September 30, 2003. The date shown is the next put date. (b) Security sold within the terms of a private placement memorandum, exempt from registration under Rule 144A of the Securities Act of 1933, as amended, and may be sold only to dealers in that program or other "qualified institutional buyers." These securities have been determined to be liquid under the guidelines established by the Funds' board of directors. As of September 30, 2003, the value of these investments was $209,122,000 or 15.2% of total net assets. AMBAC - American Municipal Bond Assurance Company CP - Commercial Paper FGIC - Financial Guaranty Insurance Corporation FSA - Financial Security Assistance GO - General Obligation GTY - Guaranty INS - Insured LOC - Letter of Credit MBIA - Municipal Bond Insurance Association SPA - Standby Purchase Agreement TXPSF - Texas Permanent School Fund TREASURY OBLIGATIONS FUND
DESCRIPTION PAR (000) VALUE (000) - ------------------------------------------------------------------------------------ U.S. TREASURY OBLIGATIONS - 22.6% U.S. Treasury Notes 2.750%, 10/31/03 $ 600,000 $ 600,616 3.250%, 12/31/03 75,000 75,319 3.625%, 03/31/04 350,000 354,191 3.375%, 04/30/04 375,000 379,665 3.250%, 05/31/04 125,000 126,765 2.875%, 06/30/04 400,000 405,498 2.125%, 08/31/04 495,000 498,990 1.875%, 09/30/04 80,000 80,438 ------------ TOTAL U.S. TREASURY OBLIGATIONS (Cost $2,521,482) 2,521,482 ------------ REPURCHASE AGREEMENTS - 77.3% ABN AMRO 0.950%, dated 9/30/03, matures 10/1/03, repurchase price $1,410,037,208 (collateralized by U.S. Treasury Obligations: Total Market Value $1,438,200,718) 1,410,000 1,410,000 Banc One 0.980%, dated 9/30/03, matures 10/1/03, repurchase price $500,013,611 (collateralized by U.S. Treasury Obligations: Total Market Value $510,002,707) 500,000 500,000 Bank of America 0.930%, dated 9/30/03, matures 10/1/03, repurchase price $320,008,267 (collateralized by U.S. Treasury Obligations: Total Market Value $326,400,077) 320,000 320,000 Bear Stearns 0.970%, dated 9/30/03, matures 10/1/03, repurchase price $1,000,026,944 (collateralized by U.S. Treasury Obligations: Total Market Value $1,021,483,802) 1,000,000 1,000,000 CS First Boston 0.980%, dated 9/30/03, matures 10/1/03, repurchase price $460,012,522 (collateralized by U.S. Treasury Obligations: Total Market Value $469,200,322) 460,000 460,000 Deutsche Bank 0.950%, dated 9/30/03, matures 10/1/03, repurchase price $500,013,194 (collateralized by U.S. Treasury Obligations: Total Market Value $510,000,129) 500,000 500,000 Goldman Sachs 0.920%, dated 9/30/03, matures 10/1/03, repurchase price $1,670,042,678 (collateralized by U.S. Treasury Obligations: Total Market Value $1,703,401,352) 1,670,000 1,670,000 Greenwich Capital 0.970%, dated 9/30/03, matures 10/1/03, repurchase price $525,014,146 (collateralized by U.S. Treasury Obligations: Total Market Value $535,503,181) 525,000 525,000 Lehman Brothers 0.990%, dated 9/30/03, matures 10/1/03, repurchase price $110,003,025 (collateralized by U.S. Treasury Obligations: Total Market Value $112,188,994) 110,000 110,000 Merrill Lynch 0.950%, dated 9/30/03, matures 10/1/03, repurchase price $335,008,840 (collateralized by cash and U.S. Treasury Obligations: Total Market Value $341,507,195) 335,000 335,000
11
DESCRIPTION PAR (000) VALUE (000) - ------------------------------------------------------------------------------------ Morgan Stanley 0.950%, dated 9/30/03, matures 10/1/03, repurchase price $400,010,556 (collateralized by U.S. Treasury Obligations: Total Market Value $408,000,245) $ 400,000 $ 400,000 Prudential Securities 0.960%, dated 9/30/03, matures 10/1/03, repurchase price $300,008,000 (collateralized by cash and U.S. Treasury Obligations: Total Market Value $303,236,156) 300,000 300,000 Societe Generale 0.950%, dated 9/30/03, matures 10/1/03, repurchase price $125,032,986 (collateralized by U.S. Treasury Obligations: Total Market Value $127,518,665) 125,000 125,000 UBS Warburg 0.960%, dated 9/30/03, matures 10/1/03, repurchase price $937,721,005 (collateralized by U.S. Treasury Obligations: Total Market Value $956,451,495) 937,696 937,696 ------------ TOTAL REPURCHASE AGREEMENTS (Cost $8,592,696) 8,592,696 ------------ TOTAL INVESTMENTS - 99.9% (Cost $11,114,178) 11,114,178 ------------ OTHER ASSETS AND LIABILITIES, NET - 0.1% 9,167 ------------ TOTAL NET ASSETS - 100.0% $ 11,123,345 ------------
TREASURY RESERVE FUND
DESCRIPTION PAR (000) VALUE (000) - ------------------------------------------------------------------------------------ U.S. TREASURY OBLIGATIONS - 29.1% U.S. Treasury Notes 2.750%, 10/31/03 $ 165,000 $ 165,169 3.250%, 12/31/03 50,000 50,212 3.625%, 03/31/04 85,000 86,011 3.375%, 04/30/04 25,000 25,308 3.250%, 05/31/04 20,000 20,282 2.875%, 06/30/04 95,000 96,290 2.125%, 08/31/04 105,000 105,844 1.875%, 09/30/04 20,000 20,110 ------------ TOTAL U.S. TREASURY OBLIGATIONS (Cost $569,226) 569,226 ------------ REPURCHASE AGREEMENTS - 70.8% ABN AMRO 0.950%, dated 9/30/03, matures 10/1/03, repurchase price $90,002,375 (collateralized by U.S. Treasury Obligations: Total Market Value $91,800,197) 90,000 90,000 Bank of America 0.930%, dated 9/30/03, matures 10/1/03, repurchase price $80,002,067 (collateralized by U.S. Treasury Obligations: Total Market Value $81,601,321) 80,000 80,000 Bear Stearns 0.970%, dated 9/30/03, matures 10/1/03, repurchase price $500,013,472 (collateralized by U.S. Treasury Obligations: Total Market Value $516,051,112) 500,000 500,000 CS First Boston 0.980%, dated 9/30/03, matures 10/1/03, repurchase price $90,002,450 (collateralized by U.S. Treasury Obligations: Total Market Value $91,800,019) 90,000 90,000 Goldman Sachs 0.920%, dated 9/30/03, matures 10/1/03, repurchase price $80,002,044 (collateralized by U.S. Treasury Obligations: Total Market Value $81,600,494) 80,000 80,000 Greenwich Capital 0.970%, dated 9/30/03, matures 10/1/03, repurchase price $225,006,063 (collateralized by U.S. Treasury Obligations: Total Market Value $229,501,196) 225,000 225,000 Lehman Brothers 0.990%, dated 9/30/03, matures 10/1/03, repurchase price $90,002,475 (collateralized by U.S. Treasury Obligations: Total Market Value $91,775,617) 90,000 90,000 Merrill Lynch 0.950%, dated 9/30/03, matures 10/1/03, repurchase price $90,002,375 (collateralized by U.S. Treasury Obligations: Total Market Value $91,801,235) 90,000 90,000 Morgan Stanley 0.950%, dated 9/30/03, matures 10/1/03, repurchase price $100,002,639 (collateralized by U.S. Treasury Obligations: Total Market Value $102,000,406) 100,000 100,000
The accompanying notes are an integral part of the financial statements. 12
DESCRIPTION PAR (000) VALUE (000) - ------------------------------------------------------------------------------------ UBS Warburg 0.960%, dated 9/30/03, matures 10/1/03, repurchase price $38,940,038 (collateralized by U.S. Treasury Obligations: Total Market Value $39,717,786) $ 38,939 $ 38,939 ------------ TOTAL REPURCHASE AGREEMENTS (Cost $1,383,939) 1,383,939 ------------ TOTAL INVESTMENTS - 99.9% (Cost $1,953,165) 1,953,165 ------------ OTHER ASSETS AND LIABILITIES, NET - 0.1% 2,187 ------------ TOTAL NET ASSETS - 100.0% $ 1,955,352 ------------
13 STATEMENTS OF ASSETS AND LIABILITIES September 30, 2003, in thousands, except per share data
GOVERNMENT PRIME TAX FREE TREASURY TREASURY OBLIGATIONS OBLIGATIONS OBLIGATIONS OBLIGATIONS RESERVE FUND FUND FUND FUND FUND - ----------------------------------------------------------------------------------------------------------------------------------- ASSETS: Investments in securities, at amortized cost* $ 2,440,709 $ 15,982,013 $ 1,389,613 $ 2,521,482 $ 569,226 Repurchase agreements, at amortized cost 693,302 1,080,063 -- 8,592,696 1,383,939 Cash -- -- -- 1 -- Receivable for securities sold -- -- 7,520 -- -- Dividends and interest receivable 6,897 46,347 2,407 18,251 3,808 Capital shares sold 28 1,164 -- 101 402 Prepaid expenses and other assets 83 336 64 253 58 - ----------------------------------------------------------------------------------------------------------------------------------- TOTAL ASSETS 3,141,019 17,109,923 1,399,604 11,132,784 1,957,433 =================================================================================================================================== LIABILITIES: Bank overdraft 9 -- 60 -- -- Dividends payable 1,380 8,758 508 4,404 235 Payable for investment securities purchased 25,039 -- 26,100 -- -- Payable upon return of securities loaned 131,613 -- -- -- -- Capital shares redeemed 446 3,474 -- 142 -- Payable to affiliates 532 2,566 257 1,481 387 Payable for distribution and shareholder servicing fees 864 3,940 403 3,395 1,455 Accrued expenses and other liabilities 4 25 2 17 4 - ----------------------------------------------------------------------------------------------------------------------------------- TOTAL LIABILITIES 159,887 18,763 27,330 9,439 2,081 =================================================================================================================================== NET ASSETS $ 2,981,132 $ 17,091,160 $ 1,372,274 $ 11,123,345 $ 1,955,352 =================================================================================================================================== COMPOSITION OF NET ASSETS: Portfolio capital 2,981,171 17,090,982 1,372,192 11,123,412 1,955,352 Undistributed (distributions in excess of) net investment income (27) 172 (4) (5) -- Accumulated net realized gain (loss) on investments (12) 6 86 (62) -- - ----------------------------------------------------------------------------------------------------------------------------------- NET ASSETS $ 2,981,132 $ 17,091,160 $ 1,372,274 $ 11,123,345 $ 1,955,352 =================================================================================================================================== * Including securities loaned, at amortized cost $ 129,420 $ -- $ -- $ -- $ -- CLASS A: Net assets $ 467,541 $ 4,632,371 $ 348,974 $ 478,627 $ 1,955,352 Shares issued and outstanding ($0.01 par value - 20 billion authorized) 467,472 4,632,408 348,989 478,603 1,955,369 Net asset value, offering price, and redemption price per share $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 CLASS B: Net assets -- $ 8,079 -- -- -- Shares issued and outstanding ($0.01 par value - 20 billion authorized) -- 8,084 -- -- -- Net asset value, offering price, and redemption price per share -- $ 1.00 -- -- -- CLASS C: Net assets -- $ 6,736 -- -- -- Shares issued and outstanding ($0.01 par value - 1 billion authorized) -- 6,737 -- -- -- Net asset value, offering price, and redemption price per share -- $ 1.00 -- -- -- CLASS D: Net assets $ 902,940 $ 632,464 $ 19,343 $ 5,720,129 -- Shares issued and outstanding ($0.01 par value - 20 billion authorized) 902,959 632,472 19,343 5,720,179 -- Net asset value, offering price, and redemption price per share $ 1.00 $ 1.00 $ 1.00 $ 1.00 -- CLASS I: Net assets -- $ 1,631,687 -- -- -- Shares issued and outstanding ($0.01 par value - 20 billion authorized) -- 1,631,727 -- -- -- Net asset value, offering price, and redemption price per share -- $ 1.00 -- -- -- CLASS S: Net assets $ 60,206 $ 120,863 $ 123,272 $ 1,354,195 -- Shares issued and outstanding ($0.01 par value - 5 billion authorized) 60,275 120,863 123,284 1,354,195 -- Net asset value, offering price, and redemption price per share $ 1.00 $ 1.00 $ 1.00 $ 1.00 -- CLASS Y: Net assets $ 1,550,445 $ 6,830,595 $ 880,685 $ 3,570,394 -- Shares issued and outstanding ($0.01 par value - 20 billion authorized) 1,550,552 6,830,520 880,641 3,570,424 -- Net asset value, offering price, and redemption price per share $ 1.00 $ 1.00 $ 1.00 $ 1.00 -- CLASS Z: Net assets -- $ 3,228,365 -- -- -- Shares issued and outstanding ($0.01 par value - 20 billion authorized) -- 3,228,365 -- -- -- Net asset value, offering price, and redemption price per share -- $ 1.00 -- -- -- - -----------------------------------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 14 STATEMENTS OF OPERATIONS For the fiscal year ended September 30, 2003, in thousands
GOVERNMENT PRIME TAX FREE TREASURY TREASURY OBLIGATIONS OBLIGATIONS OBLIGATIONS OBLIGATIONS RESERVE FUND FUND FUND FUND FUND - ----------------------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Interest $ 41,911 $ 248,738 $ 17,106 $ 140,144 $ 33,630 Securities lending 126 -- -- -- -- Other income -- -- -- 6 -- - ----------------------------------------------------------------------------------------------------------------------------------- TOTAL INVESTMENT INCOME 42,037 248,738 17,106 140,150 33,630 =================================================================================================================================== EXPENSES: Investment advisory fees 9,460 53,010 4,414 33,178 7,765 Co-administration fees and expenses (including per account transfer agency fees) 4,226 27,154 2,071 15,073 3,280 Custodian fees 308 1,711 144 1,085 250 Directors' fees 47 269 21 167 41 Registration fees 88 153 58 73 47 Printing 45 276 21 163 44 Professional fees 102 585 45 389 84 Other 105 492 64 319 104 Distribution and shareholder servicing fees - Class A 1,547 15,250 1,155 1,123 13,455 Distribution and shareholder servicing fees - Class B -- 87 -- -- -- Distribution and shareholder servicing fees - Class C -- 60 -- -- -- Distribution and shareholder servicing fees - Class D 1,545 1,495 42 10,418 -- Distribution and Shareholder servicing fees - Class S 226 195 511 4,146 -- Shareholder servicing fees - Class I -- 557 -- -- -- Shareholder servicing fees - Class Y 698 2,924 398 1,621 -- - ----------------------------------------------------------------------------------------------------------------------------------- TOTAL EXPENSES 18,397 104,218 8,944 67,755 25,070 =================================================================================================================================== Less: Fee waivers (1,627) (5,973) (804) (5,694) (1,603) - ----------------------------------------------------------------------------------------------------------------------------------- TOTAL NET EXPENSES 16,770 98,245 8,140 62,061 23,467 =================================================================================================================================== INVESTMENT INCOME - NET 25,267 150,493 8,966 78,089 10,163 =================================================================================================================================== NET REALIZED GAIN ON INVESTMENTS -- 6 95 2 -- =================================================================================================================================== NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 25,267 $ 150,499 $ 9,061 $ 78,091 $ 10,163 ===================================================================================================================================
The accompanying notes are an integral part of the financial statements. 15 STATEMENTS OF CHANGES IN NET ASSETS in thousands
GOVERNMENT OBLIGATIONS FUND - ---------------------------------------------------------------------------------------------------- 10/1/02 10/1/01 9/30/03 9/30/02 - ---------------------------------------------------------------------------------------------------- OPERATIONS: Investment income - net $ 25,267 $ 38,804 Net realized gain on investments -- -- - ---------------------------------------------------------------------------------------------------- Net increase in net assets resulting from operations 25,267 38,804 - ---------------------------------------------------------------------------------------------------- DISTRIBUTIONS TO SHAREHOLDERS FROM: Investment income - net: Class A (3,478) (7,539) Class B -- -- Class C -- -- Class D (5,707) (9,103) Class I -- -- Class S (523) (1,476) Class Y (15,558) (20,686) Class Z -- -- - ---------------------------------------------------------------------------------------------------- Total distributions (25,266) (38,804) ==================================================================================================== CAPITAL SHARE TRANSACTIONS AT NET ASSET VALUE OF $1.00 PER SHARE: Class A: Proceeds from sales 813,989 2,789,789 Reinvestment of distributions 3,488 7,682 Payments for redemptions (878,280) (2,759,292) - ---------------------------------------------------------------------------------------------------- Increase (decrease) in net assets from Class A transactions (60,803) 38,179 - ---------------------------------------------------------------------------------------------------- Class B: Proceeds from sales -- -- Reinvestment of distributions -- -- Payments for redemptions -- -- - ---------------------------------------------------------------------------------------------------- Decrease in net assets from Class B transactions -- -- - ---------------------------------------------------------------------------------------------------- Class C: Proceeds from sales -- -- Reinvestment of distributions -- -- Payments for redemptions -- -- - ---------------------------------------------------------------------------------------------------- Increase in net assets from Class C transactions -- -- - ---------------------------------------------------------------------------------------------------- Class D: Proceeds from sales 3,531,232 1,329,170 Reinvestment of distributions 54 65 Payments for redemptions (3,056,653) (1,510,243) - ---------------------------------------------------------------------------------------------------- Increase (decrease) in net assets from Class D transactions 474,633 (181,008) - ---------------------------------------------------------------------------------------------------- Class I: Proceeds from sales -- -- Reinvestment of distributions -- -- Payments for redemptions -- -- - ---------------------------------------------------------------------------------------------------- Decrease in net assets from Class I transactions -- -- - ---------------------------------------------------------------------------------------------------- Class S: Proceeds from sales 215,734 266,533 Reinvestment of distributions 1 2 Payments for redemptions (257,042) (261,058) - ---------------------------------------------------------------------------------------------------- Increase (decrease) in net assets from Class S transactions (41,307) 5,477 - ---------------------------------------------------------------------------------------------------- Class Y: Proceeds from sales 12,298,176 3,904,853 Reinvestment of distributions 6,776 9,599 Payments for redemptions (12,317,387) (3,393,272) - ---------------------------------------------------------------------------------------------------- Increase (decrease) in net assets from Class Y transactions (12,435) 521,180 - ---------------------------------------------------------------------------------------------------- Class Z: Proceeds from sales -- -- Reinvestment of distributions -- -- Payments for redemptions -- -- - ---------------------------------------------------------------------------------------------------- Increase in net assets from Class Z transactions -- -- - ---------------------------------------------------------------------------------------------------- Increase (decrease) in net assets from capital share transactions 360,088 383,828 - ---------------------------------------------------------------------------------------------------- Total increase (decrease) in net assets 360,089 383,828 NET ASSETS AT BEGINNING OF PERIOD 2,621,043 2,237,215 ==================================================================================================== NET ASSETS AT END OF PERIOD $ 2,981,132 $ 2,621,043 ==================================================================================================== UNDISTRIBUTED (DISTRIBUTIONS IN EXCESS OF) NET INVESTMENT INCOME (LOSS) AT END OF PERIOD $ (27) $ (28) ====================================================================================================
The accompanying notes are an integral part of the financial statements. 16
PRIME TAX FREE OBLIGATIONS FUND OBLIGATIONS FUND - ---------------------------------------------------------------------------------------------------------------------------------- 10/1/02 10/1/01 10/1/02 10/1/01 9/30/03 9/30/02 9/30/03 9/30/02 - ---------------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Investment income - net $ 150,493 $ 300,662 $ 8,966 $ 13,146 Net realized gain on investments 6 10 95 -- - ---------------------------------------------------------------------------------------------------------------------------------- Net increase in net assets resulting from operations 150,499 300,672 9,061 13,146 - ---------------------------------------------------------------------------------------------------------------------------------- DISTRIBUTIONS TO SHAREHOLDERS FROM: Investment income - net: Class A (33,928) (83,069) (1,927) (4,099) Class B (11) (57) -- -- Class C (6) (16) -- -- Class D (6,265) (12,504) (131) (240) Class I (25,049) (49,175) -- -- Class S (348) (289) (880) (2,543) Class Y (81,697) (155,552) (6,028) (6,264) Class Z (3,190) -- -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Total distributions (150,494) (300,662) (8,966) (13,146) ================================================================================================================================== CAPITAL SHARE TRANSACTIONS AT NET ASSET VALUE OF $1.00 PER SHARE: Class A: Proceeds from sales 10,000,038 8,447,072 430,912 502,664 Reinvestment of distributions 35,428 84,726 2,073 4,195 Payments for redemptions (11,131,842) (8,587,209) (490,240) (598,285) - ---------------------------------------------------------------------------------------------------------------------------------- Increase (decrease) in net assets from Class A transactions (1,096,376) (55,411) (57,255) (91,426) - ---------------------------------------------------------------------------------------------------------------------------------- Class B: Proceeds from sales 4,397 7,652 -- -- Reinvestment of distributions 13 58 -- -- Payments for redemptions (6,680) (4,754) -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Decrease in net assets from Class B transactions (2,270) 2,956 -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Class C: Proceeds from sales 15,669 7,738 -- -- Reinvestment of distributions 4 18 -- -- Payments for redemptions (11,894) (6,961) -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Increase in net assets from Class C transactions 3,779 795 -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Class D: Proceeds from sales 6,138,802 4,423,759 69,558 94,998 Reinvestment of distributions 556 1,435 -- 6 Payments for redemptions (6,130,325) (4,540,635) (71,168) (106,667) - ---------------------------------------------------------------------------------------------------------------------------------- Increase (decrease) in net assets from Class D transactions 9,033 (115,441) (1,610) (11,663) - ---------------------------------------------------------------------------------------------------------------------------------- Class I: Proceeds from sales 8,342,321 6,398,570 -- -- Reinvestment of distributions 2,257 2,516 -- -- Payments for redemptions (9,291,624) (6,754,619) -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Decrease in net assets from Class I transactions (947,046) (353,533) -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Class S: Proceeds from sales 504,642 130,907 389,270 443,750 Reinvestment of distributions 1 -- -- 2 Payments for redemptions (417,928) (96,759) (472,655) (639,920) - ---------------------------------------------------------------------------------------------------------------------------------- Increase (decrease) in net assets from Class S transactions 86,715 34,148 (83,385) (196,168) - ---------------------------------------------------------------------------------------------------------------------------------- Class Y: Proceeds from sales 66,564,151 29,324,181 2,638,663 1,341,373 Reinvestment of distributions 37,417 79,425 741 191 Payments for redemptions (68,437,758) (28,313,972) (2,342,910) (1,200,708) - ---------------------------------------------------------------------------------------------------------------------------------- Increase (decrease) in net assets from Class Y transactions (1,836,190) 1,089,634 296,494 140,856 - ---------------------------------------------------------------------------------------------------------------------------------- Class Z: Proceeds from sales 4,895,562 -- -- -- Reinvestment of distributions 62 -- -- -- Payments for redemptions (1,667,259) -- -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Increase in net assets from Class Z transactions 3,228,365 -- -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Increase (decrease) in net assets from capital share transactions (553,990) 603,148 154,244 (158,401) - ---------------------------------------------------------------------------------------------------------------------------------- Total increase (decrease) in net assets (553,985) 603,158 154,339 (158,401) NET ASSETS AT BEGINNING OF PERIOD 17,645,145 17,041,987 1,217,935 1,376,336 ================================================================================================================================== NET ASSETS AT END OF PERIOD $ 17,091,160 $ 17,645,145 $ 1,372,274 $ 1,217,935 ================================================================================================================================== UNDISTRIBUTED (DISTRIBUTIONS IN EXCESS OF) NET INVESTMENT INCOME (LOSS) AT END OF PERIOD $ 172 $ 163 $ (4) $ (4) ================================================================================================================================== TREASURY TREASURY OBLIGATIONS FUND RESERVE FUND - ---------------------------------------------------------------------------------------------------------------------------------- 10/1/02 10/1/01 10/1/02 10/1/01 9/30/03 9/30/02 9/30/03 9/30/02 - ---------------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Investment income - net $ 78,089 $ 140,792 $ 10,163 $ 32,018 Net realized gain on investments 2 -- -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Net increase in net assets resulting from operations 78,091 140,792 10,163 32,018 - ---------------------------------------------------------------------------------------------------------------------------------- DISTRIBUTIONS TO SHAREHOLDERS FROM: Investment income - net: Class A (2,047) (2,190) (10,163) (32,018) Class B -- -- -- -- Class C -- -- -- -- Class D (36,523) (61,842) -- -- Class I -- -- -- -- Class S (8,107) (25,018) -- -- Class Y (31,412) (51,742) -- -- Class Z -- -- -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Total distributions (78,089) (140,792) (10,163) (32,018) ================================================================================================================================== CAPITAL SHARE TRANSACTIONS AT NET ASSET VALUE OF $1.00 PER SHARE: Class A: Proceeds from sales 1,329,721 759,331 3,491,491 2,952,368 Reinvestment of distributions 318 977 9,039 28,410 Payments for redemptions (1,081,952) (662,012) (4,339,951) (2,946,484) - ---------------------------------------------------------------------------------------------------------------------------------- Increase (decrease) in net assets from Class A transactions 248,087 98,296 (839,421) 34,294 - ---------------------------------------------------------------------------------------------------------------------------------- Class B: Proceeds from sales -- -- -- -- Reinvestment of distributions -- -- -- -- Payments for redemptions -- -- -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Decrease in net assets from Class B transactions -- -- -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Class C: Proceeds from sales -- -- -- -- Reinvestment of distributions -- -- -- -- Payments for redemptions -- -- -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Increase in net assets from Class C transactions -- -- -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Class D: Proceeds from sales 36,795,843 13,766,667 -- -- Reinvestment of distributions 32 198 -- -- Payments for redemptions (36,231,031) (12,608,284) -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Increase (decrease) in net assets from Class D transactions 564,844 1,158,581 -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Class I: Proceeds from sales -- -- -- -- Reinvestment of distributions -- -- -- -- Payments for redemptions -- -- -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Decrease in net assets from Class I transactions -- -- -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Class S: Proceeds from sales 2,891,552 2,909,929 -- -- Reinvestment of distributions 48 93 -- -- Payments for redemptions (3,185,732) (3,297,128) -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Increase (decrease) in net assets from Class S transactions (294,132) (387,106) -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Class Y: Proceeds from sales 20,137,572 16,329,970 -- -- Reinvestment of distributions 7,504 11,009 -- -- Payments for redemptions (19,571,299) (16,274,127) -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Increase (decrease) in net assets from Class Y transactions 573,777 66,852 -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Class Z: Proceeds from sales -- -- -- -- Reinvestment of distributions -- -- -- -- Payments for redemptions -- -- -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Increase in net assets from Class Z transactions -- -- -- -- - ---------------------------------------------------------------------------------------------------------------------------------- Increase (decrease) in net assets from capital share transactions 1,092,576 936,623 (839,421) 34,294 - ---------------------------------------------------------------------------------------------------------------------------------- Total increase (decrease) in net assets 1,092,578 936,623 (839,421) 34,294 NET ASSETS AT BEGINNING OF PERIOD 10,030,767 9,094,144 2,794,773 2,760,479 ================================================================================================================================== NET ASSETS AT END OF PERIOD $ 11,123,345 $ 10,030,767 $ 1,955,352 $ 2,794,773 ================================================================================================================================== UNDISTRIBUTED (DISTRIBUTIONS IN EXCESS OF) NET INVESTMENT INCOME (LOSS) AT END OF PERIOD $ (5) $ (5) $ -- $ -- ==================================================================================================================================
17 FINANCIAL HIGHLIGHTS For a share outstanding throughout the periods ended September 30, unless otherwise indicated.
NET ASSET DIVIDENDS NET ASSET VALUE NET FROM NET VALUE BEGINNING INVESTMENT INVESTMENT END OF OF PERIOD INCOME INCOME PERIOD - --------------------------------------------------------------------------------------------------------- GOVERNMENT OBLIGATIONS FUND Class A 2003 $ 1.00 $ 0.006 $ (0.006) $ 1.00 2002 1.00 0.014 (0.014) 1.00 2001 1.00 0.044 (0.044) 1.00 2000 1.00 0.053 (0.053) 1.00 1999 1.00 0.043 (0.043) 1.00 Class D 2003 $ 1.00 $ 0.008 $ (0.008) $ 1.00 2002 1.00 0.015 (0.015) 1.00 2001 1.00 0.046 (0.046) 1.00 2000 1.00 0.055 (0.055) 1.00 1999 1.00 0.044 (0.044) 1.00 Class S 2003 $ 1.00 $ 0.006 $ (0.006) $ 1.00 2002 1.00 0.014 (0.014) 1.00 2001 (1) 1.00 0.001 (0.001) 1.00 Class Y 2003 $ 1.00 $ 0.009 $ (0.009) $ 1.00 2002 1.00 0.017 (0.017) 1.00 2001 1.00 0.047 (0.047) 1.00 2000 1.00 0.056 (0.056) 1.00 1999 1.00 0.046 (0.046) 1.00
(1) Commenced operations on September 24, 2001. All ratios for the period have been annualized, except total return. (2) Total return would have been lower had certain expenses not been waived. The accompanying notes are an integral part of the financial statements. 18
RATIO OF RATIO OF NET RATIO OF NET EXPENSES TO INVESTMENT RATIO OF INVESTMENT AVERAGE INCOME NET ASSETS EXPENSES TO INCOME NET ASSETS TO AVERAGE NET TOTAL END OF AVERAGE TO AVERAGE (EXCLUDING ASSETS (EXCLUDING RETURN (2) PERIOD (000) NET ASSETS NET ASSETS WAIVERS) WAIVERS) - ------------------------------------------------------------------------------------------------------------------------------ GOVERNMENT OBLIGATIONS FUND Class A 2003 0.65% $ 467,541 0.73% 0.65% 0.78% 0.60% 2002 1.41 528,343 0.75 1.39 0.81 1.33 2001 4.53 490,164 0.75 4.41 0.81 4.35 2000 5.43 470,587 0.76 5.29 0.82 5.23 1999 4.36 435,227 0.75 4.28 0.82 4.21 Class D 2003 0.78% $ 902,940 0.60% 0.73% 0.65% 0.68% 2002 1.56 428,307 0.60 1.57 0.66 1.51 2001 4.68 609,315 0.60 4.51 0.66 4.45 2000 5.59 472,078 0.60 5.47 0.66 5.41 1999 4.52 439,287 0.60 4.44 0.67 4.37 Class S 2003 0.52% $ 60,206 0.75% 0.67% 0.81% 0.61% 2002 1.41 101,513 0.75 1.42 0.81 1.36 2001 (1) 0.05 96,036 0.70 2.66 0.80 2.56 Class Y 2003 0.93% $ 1,550,445 0.45% 0.93% 0.51% 0.87% 2002 1.71 1,562,880 0.45 1.68 0.51 1.62 2001 4.84 1,041,700 0.45 4.75 0.51 4.69 2000 5.75 937,230 0.45 5.59 0.51 5.53 1999 4.67 938,897 0.45 4.57 0.52 4.50
19
NET ASSET DIVIDENDS NET ASSET VALUE NET FROM NET VALUE BEGINNING INVESTMENT INVESTMENT END OF OF PERIOD INCOME INCOME PERIOD - --------------------------------------------------------------------------------------------------------- PRIME OBLIGATIONS FUND Class A 2003 $ 1.00 $ 0.006 $ (0.006) $ 1.00 2002 1.00 0.014 (0.014) 1.00 2001 1.00 0.045 (0.045) 1.00 2000 1.00 0.054 (0.054) 1.00 1999 1.00 0.044 (0.044) 1.00 Class B 2003 $ 1.00 $ 0.001 $ (0.001) $ 1.00 2002 1.00 0.007 (0.007) 1.00 2001 1.00 0.038 (0.038) 1.00 2000 1.00 0.047 (0.047) 1.00 1999 1.00 0.038 (0.038) 1.00 Class C 2003 $ 1.00 $ 0.001 $ (0.001) $ 1.00 2002 1.00 0.007 (0.007) 1.00 2001 1.00 0.038 (0.038) 1.00 2000 1.00 0.047 (0.047) 1.00 1999 (1) 1.00 0.024 (0.024) 1.00 Class D 2003 $ 1.00 $ 0.008 $ (0.008) $ 1.00 2002 1.00 0.016 (0.016) 1.00 2001 1.00 0.047 (0.047) 1.00 2000 1.00 0.056 (0.056) 1.00 1999 1.00 0.046 (0.046) 1.00 Class I 2003 $ 1.00 $ 0.010 $ (0.010) $ 1.00 2002 1.00 0.018 (0.018) 1.00 2001 (2) 1.00 0.001 (0.001) 1.00 Class S 2003 $ 1.00 $ 0.007 $ (0.007) $ 1.00 2002 1.00 0.014 (0.014) 1.00 2001 (2) 1.00 -- -- 1.00 Class Y 2003 $ 1.00 $ 0.010 $ (0.010) $ 1.00 2002 1.00 0.017 (0.017) 1.00 2001 1.00 0.048 (0.048) 1.00 2000 1.00 0.057 (0.057) 1.00 1999 1.00 0.048 (0.048) 1.00 Class Z 2003 (3) $ 1.00 $ 0.002 $ (0.002) $ 1.00
(1) Commenced operations on February 1, 1999. All ratios for the period have been annualized, except total return. (2) Commenced operations on September 24, 2001. All ratios for the period have been annualized, except total return. (3) Commenced operations on August 1, 2003. All ratios for the period have been annualized, except total return. (4) Total return does not reflect sales charges applicable to Class B and Class C shares. Total return would have been lower had certain expenses not been waived. The accompanying notes are an integral part of the financial statements. 20
RATIO OF RATIO OF NET RATIO OF NET EXPENSES TO INVESTMENT RATIO OF INVESTMENT AVERAGE INCOME NET ASSETS EXPENSES TO INCOME NET ASSETS TO AVERAGE NET TOTAL END OF AVERAGE TO AVERAGE (EXCLUDING ASSETS (EXCLUDING RETURN (4) PERIOD (000) NET ASSETS NET ASSETS WAIVERS) WAIVERS) - ------------------------------------------------------------------------------------------------------------------------------ PRIME OBLIGATIONS FUND Class A 2003 0.63% $ 4,632,371 0.81% 0.64% 0.83% 0.62% 2002 1.43 5,728,745 0.81 1.42 0.84 1.39 2001 4.61 5,784,153 0.83 4.46 0.85 4.44 2000 5.52 4,614,094 0.82 5.40 0.86 5.36 1999 4.51 4,170,881 0.80 4.42 0.87 4.35 Class B 2003 0.04% $ 8,079 1.36% 0.10% 1.38% 0.08% 2002 0.75 10,350 1.48 0.73 1.51 0.70 2001 3.92 7,393 1.48 3.74 1.51 3.71 2000 4.85 4,009 1.47 4.72 1.51 4.68 1999 3.85 4,007 1.45 3.78 1.51 3.72 Class C 2003 0.14% $ 6,736 1.33% 0.07% 1.35% 0.05% 2002 0.75 2,958 1.48 0.71 1.51 0.68 2001 3.90 2,163 1.49 3.66 1.51 3.64 2000 4.85 371 1.46 4.63 1.51 4.58 1999 (1) 2.47 341 1.45 3.75 1.51 3.69 Class D 2003 0.82% $ 632,464 0.63% 0.80% 0.65% 0.78% 2002 1.61 623,431 0.63 1.61 0.66 1.58 2001 4.81 738,871 0.63 4.55 0.65 4.53 2000 5.74 515,806 0.62 5.62 0.66 5.58 1999 4.73 426,004 0.60 4.62 0.66 4.56 Class I 2003 1.05% $ 1,631,687 0.40% 1.07% 0.42% 1.05% 2002 1.84 2,578,732 0.40 1.85 0.43 1.82 2001 (2) 0.06 2,932,264 0.48 3.00 0.54 2.94 Class S 2003 0.67% $ 120,863 0.78% 0.59% 0.80% 0.57% 2002 1.46 34,147 0.78 1.31 0.81 1.28 2001 (2) 0.04 -- -- -- -- -- Class Y 2003 0.97% $ 6,830,595 0.48% 0.98% 0.50% 0.96% 2002 1.76 8,666,782 0.48 1.73 0.51 1.70 2001 4.96 7,577,143 0.48 4.78 0.50 4.76 2000 5.90 6,431,029 0.47 5.75 0.51 5.71 1999 4.89 6,228,207 0.45 4.78 0.51 4.72 Class Z 2003 (3) 0.16% $ 3,228,365 0.20% 0.97% 0.22% 0.95%
21
NET ASSET DIVIDENDS NET ASSET VALUE NET FROM NET VALUE BEGINNING INVESTMENT INVESTMENT END OF OF PERIOD INCOME INCOME PERIOD - --------------------------------------------------------------------------------------------------------- TAX FREE OBLIGATIONS FUND Class A 2003 $ 1.00 $ 0.005 $ (0.005) $ 1.00 2002 1.00 0.008 (0.008) 1.00 2001 1.00 0.027 (0.027) 1.00 2000 1.00 0.032 (0.032) 1.00 1999 1.00 0.025 (0.025) 1.00 Class D 2003 $ 1.00 $ 0.006 $ (0.006) $ 1.00 2002 1.00 0.010 (0.010) 1.00 2001 1.00 0.028 (0.028) 1.00 2000 1.00 0.034 (0.034) 1.00 1999 1.00 0.026 (0.026) 1.00 Class S 2003 $ 1.00 $ 0.005 $ (0.005) $ 1.00 2002 1.00 0.008 (0.008) 1.00 2001 (1) 1.00 -- -- 1.00 Class Y 2003 $ 1.00 $ 0.008 $ (0.008) $ 1.00 2002 1.00 0.011 (0.011) 1.00 2001 1.00 0.029 (0.029) 1.00 2000 1.00 0.035 (0.035) 1.00 1999 1.00 0.028 (0.028) 1.00 TREASURY OBLIGATIONS FUND Class A 2003 $ 1.00 $ 0.006 $ (0.006) $ 1.00 2002 1.00 0.013 (0.013) 1.00 2001 1.00 0.043 (0.043) 1.00 2000 1.00 0.052 (0.052) 1.00 1999 1.00 0.042 (0.042) 1.00 Class D 2003 $ 1.00 $ 0.007 $ (0.007) $ 1.00 2002 1.00 0.015 (0.015) 1.00 2001 1.00 0.045 (0.045) 1.00 2000 1.00 0.052 (0.052) 1.00 1999 1.00 0.043 (0.043) 1.00 Class S 2003 $ 1.00 $ 0.006 $ (0.006) $ 1.00 2002 1.00 0.013 (0.013) 1.00 2001 (1) 1.00 0.001 (0.001) 1.00 Class Y 2003 $ 1.00 $ 0.009 $ (0.009) $ 1.00 2002 1.00 0.016 (0.016) 1.00 2001 1.00 0.046 (0.046) 1.00 2000 1.00 0.054 (0.054) 1.00 1999 1.00 0.045 (0.045) 1.00
(1) Commenced operations on September 24, 2001. All ratios for the period have been annualized, except total return. (2) Total return would have been lower had certain expenses not been waived. The accompanying notes are an integral part of the financial statements. 22
RATIO OF RATIO OF NET RATIO OF NET EXPENSES TO INVESTMENT RATIO OF INVESTMENT AVERAGE INCOME (LOSS) NET ASSETS EXPENSES TO INCOME NET ASSETS TO AVERAGE NET TOTAL END OF AVERAGE TO AVERAGE (EXCLUDING ASSETS (EXCLUDING RETURN (2) PERIOD (000) NET ASSETS NET ASSETS WAIVERS) WAIVERS) - ------------------------------------------------------------------------------------------------------------------------------ TAX FREE OBLIGATIONS FUND Class A 2003 0.48% $ 348,974 0.72% 0.48% 0.77% 0.43% 2002 0.85 406,204 0.75 0.85 0.81 0.79 2001 2.72 497,631 0.74 2.63 0.80 2.57 2000 3.28 286,449 0.75 3.23 0.81 3.17 1999 2.51 268,626 0.74 2.47 0.82 2.39 Class D 2003 0.60% $ 19,343 0.60% 0.59% 0.65% 0.54% 2002 1.01 20,952 0.60 1.03 0.66 0.97 2001 2.86 32,615 0.60 2.84 0.66 2.78 2000 3.43 24,112 0.60 3.36 0.66 3.30 1999 2.66 33,464 0.60 2.62 0.67 2.55 Class S 2003 0.45% $ 123,272 0.75% 0.48% 0.81% 0.42% 2002 0.85 206,647 0.75 0.88 0.81 0.82 2001 (1) 0.02 402,813 0.70 1.67 0.76 1.61 Class Y 2003 0.76% $ 880,685 0.45% 0.72% 0.50% 0.67% 2002 1.16 584,132 0.45 1.14 0.51 1.08 2001 3.02 443,276 0.45 2.93 0.51 2.87 2000 3.59 375,891 0.45 3.53 0.51 3.47 1999 2.82 338,490 0.45 2.75 0.52 2.68 TREASURY OBLIGATIONS FUND Class A 2003 0.61% $ 478,627 0.70% 0.55% 0.75% 0.50% 2002 1.34 230,541 0.75 1.29 0.81 1.23 2001 4.44 132,245 0.70 4.00 0.76 3.94 2000 5.27 30,506 0.70 5.16 0.76 5.10 1999 4.31 23,496 0.70 4.24 0.76 4.18 Class D 2003 0.71% $ 5,720,129 0.60% 0.68% 0.65% 0.63% 2002 1.49 5,155,284 0.60 1.48 0.66 1.42 2001 4.54 3,996,702 0.60 4.40 0.66 4.34 2000 5.37 3,252,551 0.60 5.23 0.66 5.17 1999 4.41 3,852,189 0.60 4.32 0.66 4.26 Class S 2003 0.56% $ 1,354,195 0.75% 0.57% 0.80% 0.52% 2002 1.34 1,648,326 0.75 1.34 0.81 1.28 2001 (1) 0.05 2,035,433 0.70 2.46 0.82 2.34 Class Y 2003 0.86% $ 3,570,394 0.45% 0.85% 0.51% 0.79% 2002 1.64 2,996,616 0.45 1.62 0.51 1.56 2001 4.70 2,929,764 0.45 4.48 0.51 4.42 2000 5.53 2,065,655 0.45 5.39 0.51 5.33 1999 4.57 2,620,803 0.45 4.49 0.51 4.43
23
NET ASSET DIVIDENDS NET ASSET VALUE NET FROM NET VALUE BEGINNING INVESTMENT INVESTMENT END OF OF PERIOD INCOME INCOME PERIOD - --------------------------------------------------------------------------------------------------------- TREASURY RESERVE FUND (1) Class A 2003 $ 1.00 $ 0.004 $ (0.004) $ 1.00 2002 1.00 0.011 (0.011) 1.00 2001 (2) 1.00 0.039 (0.039) 1.00 2000 (3) 1.00 0.05 (0.05) 1.00 1999 (4) 1.00 0.04 (0.04) 1.00 1998 (4) 1.00 0.05 (0.05) 1.00
(1) The financial highlights for the Treasury Reserve Fund as set forth herein include the historical financial highlights of the Firstar U.S. Treasury Money Market Fund Class A shares. The assets of the Firstar U.S. Treasury Money Market Fund were acquired by the Treasury Reserve Fund on September 24, 2001. In connection with such acquisition, Class A shares of the Firstar U.S. Treasury Money Market Fund were exchanged for Class A shares of the Treasury Reserve Fund. (2) For the period November 1, 2000 to September 30, 2001. Effective in 2001, the Fund's fiscal year end changed from October 31 to September 30. All ratios for the period have been annualized, except total return. (3) For the period December 1, 1999 to October 31, 2000. Effective in 2000, the Fund's fiscal year end changed from November 30 to October 31. All ratios for the period have been annualized, except total return. (4) For the year ended November 30. (5) Total return would have been lower had certain expenses not been waived. The accompanying notes are an integral part of the financial statements. 24
RATIO OF RATIO OF NET RATIO OF NET EXPENSES TO INVESTMENT RATIO OF INVESTMENT AVERAGE INCOME NET ASSETS EXPENSES TO INCOME NET ASSETS TO AVERAGE NET TOTAL END OF AVERAGE TO AVERAGE (EXCLUDING ASSETS (EXCLUDING RETURN (5) PERIOD (000) NET ASSETS NET ASSETS WAIVERS) WAIVERS) - ------------------------------------------------------------------------------------------------------------------------------ TREASURY RESERVE FUND (1) Class A 2003 0.39% $ 1,955,352 0.94% 0.41% 1.00% 0.35% 2002 1.15 2,794,773 0.94 1.15 1.00 1.09 2001 (2) 3.97 2,760,479 0.94 3.92 0.95 3.91 2000 (3) 5.04 2,284,168 0.99 4.98 1.09 4.88 1999 (4) 4.02 1,049,641 0.92 3.98 1.08 3.82 1998 (4) 4.69 542,430 0.88 4.58 1.08 4.38
25 NOTES TO FINANCIAL STATEMENTS September 30, 2003 1 > Organization The First American Government Obligations Fund, Prime Obligations Fund, Tax Free Obligations Fund, Treasury Obligations Fund, and Treasury Reserve Fund (each a "Fund" and collectively, the "Funds") are mutual funds offered by First American Funds, Inc. ("FAF"), which is a member of the First American Family of Funds. FAF is registered under the Investment Company Act of 1940, as amended, as an open-end investment management company. FAF's articles of incorporation permit the Board of Directors to create additional funds in the future. FAF offers Class A, Class B, Class C, Class D, Class I, Class S, Class Y and Class Z shares. Class A shares are not subject to sales charges. Class B and Class C shares of the Prime Obligations Fund are only available pursuant to an exchange from Class B and Class C shares, respectively, of another fund in the First American Family of Funds. Class B shares are subject to a contingent deferred sales charge for six years and automatically convert to Class A shares after eight years. Class C shares may be subject to a contingent deferred sales charge for 18 months. Class D, Class I, Class S, Class Y, and Class Z shares are offered only to qualifying institutional investors and certain other qualifying accounts. Treasury Reserve Fund offers only a single class of shares, which are not subject to sales charges. Class B, Class C and Class I shares are not offered by the Government Obligations Fund, Tax Free Obligations Fund, Treasury Obligations Fund, or Treasury Reserve Fund. Class Z shares were not offered by the Government Obligations Fund, Tax Free Obligations Fund, Treasury Obligations Fund, or Treasury Reserve Fund during the fiscal year ended September 30, 2003. The Funds' prospectuses provide descriptions of each Fund's investment objective, policies and strategies. All classes of shares in FAF have identical voting, dividend, liquidation and other rights, and the same terms and conditions, except that the level of distribution and shareholder servicing fees charged may differ among classes and each class has exclusive voting rights on any matters relating to that class' servicing or distribution arrangements. 2 > Summary of Significant Accounting Policies The significant accounting policies followed by the Funds are as follows: SECURITY VALUATION - Investment securities held are stated at amortized cost, which approximates market value. Under the amortized cost method, any discount or premium is amortized ratably to the expected maturity of the security and is included in interest income. In accordance with Rule 2a-7 of the Investment Company Act of 1940, the market value of the securities held in the Funds are determined weekly using prices supplied by the Funds' pricing services. This value is then compared to the securities' amortized cost. Securities whose market price varies by more than 0.5% are identified and validated with the pricing agent. If the difference between the aggregate market price and aggregate amortized cost of all securities held by a Fund exceeds 50% of the allowable 0.5% threshold, the administrators will notify the Funds' Board of Directors. The Board of Directors will be kept apprised of the situation until the difference is under the 50% of the allowable 0.5% threshold. During the period no such notification was required. SECURITY TRANSACTIONS AND INVESTMENT INCOME - The Funds record security transactions on the trade date of the security purchase or sale. Interest income, including amortization of bond premium and discount, is recorded on an accrual basis. DISTRIBUTIONS TO SHAREHOLDERS - Distributions from net investment income are declared on a daily basis and are payable on the first business day of the following month. EXPENSES - Expenses that are directly related to one of the Funds are charged directly to that Fund. Other operating expenses are generally allocated to the Funds on the basis of relative net assets of all Funds within the First American Fund complex. Class specific expenses, such as 12b-1 fees, are borne by that class. Income, other expenses, and realized and unrealized gains and losses of a Fund are allocated to each respective class in proportion to the relative net assets of each class. FEDERAL TAXES - Each Fund is treated as a separate taxable entity. Each Fund intends to continue to qualify as a regulated investment company as provided in Subchapter M of the Internal Revenue Code, as amended, and to distribute all taxable income, if any, to its shareholders. Accordingly, no provision for federal income taxes is required. Net investment income and net realized gains (losses) may differ for financial statement and tax purposes because of temporary or permanent book/tax differences. For the fiscal year ended September 30, 2003, the Funds' income and gains for tax purposes were not significantly different from income and gains for financial statement purposes. 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 the amounts are distributed may differ from the year that the income or realized gains (losses) were recorded by the Fund. To the extent these differences are permanent, adjustments are made to the appropriate equity accounts in the period that the differences arise. 26 On the Statements of Assets and Liabilities, the following adjustments were made (000):
UNDISTRIBUTED ACCUMULATED NET INVESTMENT NET REALIZED PORTFOLIO FUND INCOME GAIN (LOSSES) CAPITAL ---------------------------------------------------------------------------------------------------------------------------- Prime Obligations $ 10 $ (10) $ -- Tax Free Obligations -- 5 (5)
The character of the distributions paid and declared for the fiscal years ended September 30, 2003 and 2002, were as follows (000):
2003 ---------------------------------------------------------------------------------------------------------------------------- ORDINARY TAX-EXEMPT FUND INCOME INCOME TOTAL ---------------------------------------------------------------------------------------------------------------------------- Government Obligations $ 25,266 $ -- $ 25,266 Prime Obligations 150,494 -- 150,494 Tax Free Obligations -- 8,966 8,966 Treasury Obligations 78,089 -- 78,089 Treasury Reserve 10,163 -- 10,163
2002 ---------------------------------------------------------------------------------------------------------------------------- ORDINARY TAX-EXEMPT FUND INCOME INCOME TOTAL ---------------------------------------------------------------------------------------------------------------------------- Government Obligations $ 38,804 $ -- $ 38,804 Prime Obligations 300,662 -- 300,662 Tax Free Obligations -- 13,146 13,146 Treasury Obligations 140,792 -- 140,792 Treasury Reserve 32,018 -- 32,018
As of September 30, 2003, the components of accumulated earnings (deficit) on a tax basis were:
GOVERNMENT PRIME TAX FREE OBLIGATIONS OBLIGATIONS OBLIGATIONS ---------------------------------------------------------------------------------------------------------------------------- Undistributed ordinary income $ 1,356 $ 8,943 $ 20 Undistributed tax exempt income -- -- 507 Undistributed long term capital gains -- -- 66 ---------------------------------------------------- Accumulated earnings 1,356 8,943 593 Accumulated capital and post-October losses (12) -- -- ---------------------------------------------------- Total accumulated earnings $ 1,344 $ 8,943 $ 593 ----------------------------------------------------
TREASURY TREASURY OBLIGATIONS RESERVE ---------------------------------------------------------------------------------------------------------------------------- Undistributed ordinary income $ 4,402 $ 235 Undistributed tax exempt income -- -- Undistributed long term capital gains -- -- ------------------------------- Accumulated earnings 4,402 235 Accumulated capital and post-October losses (62) -- ------------------------------- Total accumulated earnings $ 4,340 $ 235 -------------------------------
The differences between book-basis and tax-basis undistributed/accumulated income, gains and losses are primarily due to distributions declared but not paid by September 30, 2003. 27 As of September 30, 2003, the following Funds had capital loss carryforwards (000):
FUND AMOUNT EXPIRATION DATE ----------------------------------------------------------- Government Obligations $ 12 2006-2007 Treasury Obligations 62 2008
REPURCHASE AGREEMENTS - Each Fund may enter into repurchase agreements with member banks of the Federal Reserve or registered broker dealers whom the Funds' investment advisor deems creditworthy under guidelines approved by the Funds' board of directors, subject to the seller's agreement to repurchase such securities at a mutually agreed upon date and price. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates. Securities pledged as collateral for repurchase agreements are held by the custodian bank until the respective agreements mature. Each Fund may also invest in triparty repurchase agreements. Securities held as collateral for triparty repurchase agreements are maintained in a segregated account by the broker's custodian bank until the maturity of the repurchase agreement. Provisions of the repurchase agreements ensure that the market value of the collateral, including accrued interest thereon, is sufficient in the event of default of the counterparty. If the counterparty defaults and the value of the collateral declines or if the counterparty enters an insolvency proceeding, realization of the collateral by the Fund may be delayed or limited. SECURITIES LENDING - In order to generate additional income, a Fund may lend securities representing up to one-third of the value of its total assets (which includes collateral for securities on loan) to broker-dealers, banks or other institutional borrowers of securities. Each Fund's policy is to maintain collateral in the form of cash, U.S. Government securities, or other high-grade debt obligations equal to at least 100% of the value of securities loaned. The collateral is then "marked to market" daily until the securities are returned. As with other extensions of credit, there may be risks of delay in recovery of the securities or even loss of rights in the collateral should the borrower of the security fail financially. U.S. Bancorp Asset Management, Inc. ("USBAM") serves as the securities lending agent for the Funds in transactions involving the lending of portfolio securities on behalf of the Funds. For these services, USBAM received $96,586 in securities lending fees for the fiscal year ended September 30, 2003 from the Government Obligations Fund. INTERFUND LENDING PROGRAM - Pursuant to an exemptive order issued by the Securities and Exchange Commission, the Funds, along with other registered investment companies in the First American Family of Funds, may participate in an interfund lending program. This program provides an alternative credit facility allowing the Funds to borrow from, or lend money to, other participating funds. The Funds did not have any interfund lending transactions during the fiscal year ended September, 30, 2003. DEFERRED COMPENSATION PLAN - Under a Deferred Compensation Plan (the Plan), non-interested directors of the First American Fund family may participate and elect to defer receipt of their annual compensation. Deferred amounts are treated as though equivalent dollar amounts had been invested in shares of selected open-end First American Funds as designated by the directors. All amounts in the Plan are 100% vested and accounts under the Plan are obligations of the Funds. Deferred amounts remain in the Funds until distributed in accordance with the Plan. USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS - The preparation of financial statements, in conformity with accounting principles generally accepted in the United States, requires management to make estimates and assumptions that affect the reported amount of net assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported results of operations during the reporting period. Actual results could differ from those estimates. 3 > Fees and Expenses ADVISOR FEES - Pursuant to an investment advisory agreement (the "Agreement"), USBAM manages each Fund's assets and furnishes related office facilities, equipment, research and personnel. The Agreement requires each Fund to pay USBAM a monthly fee based upon average daily net assets. For the period October 1, 2002 to July 31, 2003, the fee for the Funds was equal to an annual rate of 0.35% of the average daily net assets of each Fund. Effective August 1, 2003, the fee for the Funds is equal to an annual rate of 0.10% of the average daily net assets of each Fund. USBAM contractually waived fees during the most recently completed fiscal year so that the total fund operating expenses did not exceed expense limitations described in the Funds' prospectuses. CO-ADMINISTRATION FEES - USBAM, and U.S. Bancorp Fund Services, LLC, ("USBFS"), (collectively, the "Administrators"), serve as co-administrators pursuant to a co-administration agreement between the Administrators 28 and the Funds. USBAM is a subsidiary of U.S. Bank National Association ("U.S. Bank"). Both U.S. Bank and USBFS are direct subsidiaries of U.S. Bancorp. Under the co-administration agreement, the Administrators are compensated to provide, or compensate other entities to provide, services to the Funds. These services include various legal, oversight and administrative services, accounting services, transfer agency and dividend disbursing services, and shareholder services. The Funds pay the Administrators at an annual rate, calculated daily and paid monthly based on the average daily net assets of all open-end mutual funds in the First American Family of Funds, equal to each Fund's pro rata share of an amount equal to 0.15% of the aggregate average daily net assets up to $8 billion, 0.135% of the next $17 billion of the aggregate average daily net assets, 0.12% of the next $25 billion of the aggregate average daily net assets, and 0.10% of the aggregate average daily net assets of all open-end mutual funds in the First American Family of Funds in excess of $50 billion. Class S shares pay an additional fee equal to 0.05% of average daily net assets attributable to such shares. The Funds, along with all other open-end mutual funds in the First American Family of Funds, pay transfer agent fees of $18,500 per share class. These fees are allocated to each Fund based upon the Fund's pro rata share of the aggregate average daily net assets of the Fund's that comprise FAF. Each Fund also pays additional per account fees for transfer agent services. For the fiscal year ended September 30, 2003, administration fees paid to USBAM and USBFS for the Funds included in this annual report were as follows (000):
FUND AMOUNT ------------------------------------------------------------ Government Obligations Fund $ 3,924 Prime Obligations Fund 20,706 Tax Free Obligations Fund 1,910 Treasury Obligations Fund 14,171 Treasury Reserve Fund 3,248
During the year ended September 30, 2003, administration fees of $1,646,785 and $16,472 were waived on Class I and Class Z shares, respectively, of Prime Obligations Fund. CUSTODIAN FEES - U.S. Bank serves as the Funds' custodian pursuant to a custodian agreement with FAF. The fee for each Fund is equal to an annual rate of 0.01% of average daily net assets. All fees are computed daily and paid monthly. DISTRIBUTION AND SHAREHOLDER SERVICING (12b-1) FEES - Quasar Distributors, LLC, ("Quasar"), a subsidiary of U.S. Bancorp, serves as distributor of the Funds pursuant to a distribution agreement with FAF. Under the distribution agreement, and pursuant to a plan adopted by each Fund under Rule 12b-1 of the Investment Company Act, each of the Funds pay Quasar a monthly distribution and/or shareholder servicing fee equal to an annual rate of 0.25% of each Fund's average daily net assets of Class A shares, 1.00% of the Class B shares, 1.00% of the Class C shares, 0.15% of the Class D shares, 0.25% of the Class S shares, and 0.50% of the Treasury Reserve Fund. These fees may be used by Quasar to provide compensation for sales support and distribution activities for each class of the Funds. In addition, for Class B shares and Class C shares, a portion of these fees may be used to provide compensation for shareholder servicing activities. No distribution and shareholder servicing fees are paid to Quasar by Class Y or Class I shares. The Rule 12b-1 plan was adopted by the Class S shareholders effective August 1, 2003. Prior to August 1, 2003, Quasar performed services with respect to the Class S shares pursuant to a shareholder service plan and agreement. Pursuant to this agreement, each fund paid Quasar a monthly shareholder servicing fee equal to an annual rate of 0.25% of each Fund's average daily net assets of the Class S shares. Under these distribution and service agreements, the following amounts were retained by Quasar for the year ended September 30, 2003 (000):
FUND AMOUNT ------------------------------------------------------------ Government Obligations Fund $ 1,181 Prime Obligations Fund 8,549 Tax Free Obligations Fund 929 Treasury Obligations Fund 6,436 Treasury Reserve Fund 11,096
SHAREHOLDER SERVICING (NON-12b-1) FEES - Effective August 1, 2003, FAF entered into a shareholder service plan and agreement with USBAM, under which USBAM has agreed to provide FAF, or will enter into written agreements with other service providers pursuant to which the service providers will provide FAF, with non-distribution-related services to shareholders of Class A, Class D, Class I, Class S, and Class Y shares, and Treasury Reserve Fund. Under this plan and agreement, the Funds have agreed to pay USBAM a fee at an annual rate of 0.25% of the average net asset value of the Class A, Class D, Class S, and Class Y shares, and Treasury Reserve 29 Fund, and a fee at an annual rate of 0.20% of the average net asset value of the Class I shares, computed daily and paid monthly. For the year ended September 30, 2003, shareholder servicing fees paid by the Funds to USBAM were as follows (000):
FUND AMOUNT ------------------------------------------------------------ Government Obligations Fund $ 1,309 Prime Obligations Fund 5,826 Tax Free Obligations Fund 619 Treasury Obligations Fund 4,800 Treasury Reserve Fund 973
SALES CHARGES - A contingent deferred sales charge ("CDSC") is imposed on redemptions made in the Class B shares. The CDSC varies depending on the number of years from time of payment for the purchase of Class B shares until the redemption of such shares. Class B shares automatically convert to Class A shares after eight years.
CONTINGENT DEFERRED SALES CHARGE AS A PERCENTAGE OF DOLLAR YEAR SINCE PURCHASE AMOUNT SUBJECT TO CHARGE ----------------------------------------------------------- First 5.00% Second 5.00% Third 4.00% Fourth 3.00% Fifth 2.00% Sixth 1.00% Seventh -- Eighth --
A CDSC of 1.00% is imposed on redemptions made in Class C shares for the first eighteen months. The CDSC for Class B shares and Class C shares is imposed on the value of the purchased shares, or the value at the time of redemption, whichever is less. For the fiscal year ended September 30, 2003, total sales charges retained by affiliates of USBAM for distributing shares of the Prime Obligations Fund were $22,960. OTHER FEES - In addition to the investment advisory fees, custodian fees, distribution and shareholder servicing fees, and co-administration fees, each Fund is responsible for paying most other operating expenses including fees and expenses of outside directors, registration fees, printing of shareholder reports, legal, auditing, insurance and other miscellaneous expenses. For the fiscal year ended September 30, 2003, legal fees and expenses were paid to a law firm of which the Secretary and two Assistant Secretaries of the Funds are partners. 4 > Concentration of Credit Risk The Tax Free Obligations Fund invests in securities that include revenue bonds, tax and revenue anticipation notes, and general obligation bonds. At September 30, 2003, the percentage of portfolio investments by each revenue source was as follows:
TAX FREE OBLIGATIONS FUND --------------------------------------------------------------- Revenue Bonds 88% General Obligations 12 ------------------- 100% -------------------
The credit ratings of long-term debt as a percentage of total market value of investments at September 30, 2003, were as follows:
STANDARD & POOR'S/ MOODY'S TAX FREE RATINGS: OBLIGATIONS FUND --------------------------------------------------------------- AAA/Aaa 39% AA/Aa 60 A/A 1 NR -- ------------------- 100% -------------------
Securities rated by only one agency are shown in that category. Securities rated by both agencies are shown with their lowest rating. 30 NOTICE TO SHAREHOLDERS September 30, 2003 (unaudited) TAX NOTICE - THE INFORMATION SET FORTH BELOW IS FOR EACH FUND'S FISCAL YEAR AS REQUIRED BY FEDERAL LAWS. MOST SHAREHOLDERS, HOWEVER, MUST REPORT DISTRIBUTIONS ON A CALENDAR YEAR BASIS FOR INCOME TAX PURPOSES, WHICH MAY INCLUDE DISTRIBUTIONS FOR PORTIONS OF TWO FISCAL YEARS OF A FUND. ACCORDINGLY, THE INFORMATION NEEDED FOR INCOME TAX PURPOSES WILL BE SENT IN EARLY 2004 ON FORM 1099. PLEASE CONSULT YOUR TAX ADVISOR FOR PROPER TREATMENT OF THIS INFORMATION. Dear First American Shareholders: For the fiscal year ended September 30, 2003, each Fund has designated long-term capital gains, ordinary income and exempt income with regard to distributions paid during the year as follows:
LONG TERM ORDINARY CAPITAL GAINS INCOME TAX TOTAL DISTRIBUTIONS DISTRIBUTIONS EXEMPT DISTRIBUTIONS FUND (TAX BASIS) (TAX BASIS) INTEREST (TAX BASIS) -------------------------------------------------------------------------------------------------- Treasury Obligations 0% 100% 0% 100% Treasury Reserve 0 100 0 100 Government Obligations 0 100 0 100 Prime Obligations 0 100 0 100 Tax Free Obligations 0 0 100 100
SHAREHOLDER MEETING - At a special meeting of the holders of the Class S shares of Government Obligations Fund, Prime Obligations Fund, Tax Free Obligations Fund and Treasury Obligations Fund on July 21, 2003, the shareholders voted to approve the following proposal: Approval of a new Rule 12b-1 Distribution Plan for the Class S shares of each of the above named funds. At the meeting, shareholders approved this proposal as follows:
SHARES SHARES VOTED VOTED SHARES FUND FOR AGAINST ABSTAINED -------------------------------------------------------------------------------------------------- Government Obligations 35,635,428 5,261,741 -- Prime Obligations 29,716,954 135,474 779,947 Tax Free Obligations 123,219,764 3,288,496 -- Treasury Obligations 953,572,215 15,451,409 10,821,401
HOW TO OBTAIN A COPY OF THE FUNDS' PROXY VOTING POLICIES - A description of the policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available (1) without charge upon request by calling 800.677.FUND; (2) at firstamericanfunds.com; and (3) on the U.S. Securities and Exchange Commission's website at sec.gov. 31 Directors and Officers of the Funds Independent Directors
OTHER POSITION(S) TERM OF OFFICE NUMBER OF PORTFOLIOS DIRECTORSHIPS NAME, ADDRESS, AND HELD AND LENGTH OF PRINCIPAL OCCUPATION(S) IN FUND COMPLEX HELD BY YEAR OF BIRTH WITH FUND TIME SERVED DURING PAST 5 YEARS OVERSEEN BY DIRECTOR DIRECTOR + - ------------------------------------------------------------------------------------------------------------------------------------ Benjamin R. Field III, Director Term expiring earlier of Senior Financial Advisor, First American Funds None 800 Nicollet Mall, death, resignation, Bemis Company, Inc. since Complex: twelve Minneapolis, MN removal, 2002; Senior Vice registered investment 55402 (1939) disqualification, or President, Chief companies, including successor duly elected Financial Officer and sixty one portfolios and qualified. Director Treasurer, Bemis, through of FAF, since September 2002 2003 Mickey P. Foret, Director Term expiring earlier of Consultant to Northwest First American Funds ADC 800 Nicollet Mall, death, resignation, Airlines, Inc. since Complex: twelve Telecommuni- Minneapolis, MN removal, 2002; Executive Vice registered investment cations, 55402 (1946) disqualification, or President and Chief companies, including Inc., URS successor duly elected Financial Officer, sixty one portfolios Corporation, and qualified. Director Northwest Airlines, Champion of FAF since September through 2002 Airlines, 2003 Inc. Roger A. Gibson, Director Term expiring earlier of Vice President, Cargo - First American Funds None 800 Nicollet Mall, death, resignation, United Airlines, since Complex: twelve Minneapolis, MN removal, July 2001; Vice registered investment 55402 (1946) disqualification, or President, North America companies, including successor duly elected - Mountain Region, United sixty one portfolios and qualified. Director Airlines, prior to July of FAF since October 2001 1997 Victoria J. Herget, Director Term expiring earlier of Investment consultant and First American Funds None 800 Nicollet Mall, death, resignation, non-profit board member Complex: twelve Minneapolis, MN removal, since 2001; Managing registered investment 55402 (1952) disqualification, or Director of Zurich companies, including successor duly elected Scudder Investments sixty one portfolios and qualified. Director through 2001 of FAF since September 2003 Leonard W. Kedrowski, Director Term expiring earlier of Owner, Executive and First American Funds None 800 Nicollet Mall, death, resignation, Management Consulting, Complex: twelve Minneapolis, MN removal, Inc., a management registered investment 55402 (1941) disqualification, or consulting firm; former companies, including successor duly elected Chief Executive Officer, sixty one portfolios and qualified. Director Creative Promotions of FAF since November International, LLC, a 1993 promotional award programs and products company, through October 2003; Board member, GC McGuiggan Corporation (DBA Smyth Companies), a label printer; Advisory Board member, Designer Doors, manufacturer of designer doors, through 2002; acted as CEO of Graphics Unlimited Director through 1998 Richard K. Riederer, Director Term expiring earlier of Retired; Director, First American Funds None 800 Nicollet Mall, death, resignation, President and Chief Complex: twelve Minneapolis, MN removal, Executive Officer, registered investment 55402 (1944) disqualification, or Weirton Steel through companies, including successor duly elected 2001 sixty one portfolios and qualified. Director of FAF since August 2001
32
OTHER POSITION(S) TERM OF OFFICE NUMBER OF PORTFOLIOS DIRECTORSHIPS NAME, ADDRESS, AND HELD AND LENGTH OF PRINCIPAL OCCUPATION(S) IN FUND COMPLEX HELD BY YEAR OF BIRTH WITH FUND TIME SERVED DURING PAST 5 YEARS OVERSEEN BY DIRECTOR DIRECTOR + - ------------------------------------------------------------------------------------------------------------------------------------ Joseph D. Strauss, Director Term expiring Owner and President, First American Funds None 800 Nicollet Mall, earlier of death, Excensus TM LLC, a Complex: twelve Minneapolis, MN resignation, consulting firm, registered 55402 (1940) removal, since 2001; Owner investment disqualification, or and President, companies, including successor duly Strauss Management sixty one portfolios elected and Company, a Minnesota qualified. Director holding company for of FAF since various September 1984 organizational management business ventures; Owner, Chairman and Chief Executive Officer, Community Resource Partnerships, Inc., a strategic planning, operations management, government relations, transportation planning and public relations organization; attorney at law Virginia L. Stringer, Chair; Chair Term three Owner and President, First American Funds None 800 Nicollet Mall, Director years. Directors Strategic Management Complex: twelve Minneapolis, MN Term expiring Resources, Inc., a registered 55402 (1944) earlier of death, management investment resignation, consulting firm; companies, including removal, Executive Consultant sixty one portfolios disqualification, or for State Farm successor duly Insurance Company elected and qualified. Chair of FAF's Board since September 1997; Director of FAF since June 1991 James M. Wade, Director Term expiring Owner and President, First American Funds None 800 Nicollet Mall, earlier of death, Jim Wade Homes, a Complex: twelve Minneapolis, MN resignation, homebuilding registered 55402 (1943) removal, company, since 1999 investment disqualification, or companies, including successor duly sixty one portfolios elected and qualified. Director of FAF since August 2001
+ Includes only directorships in a company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act or subject to the requirements of Section 15(d) of the Securities Exchange Act, or any company registered as an investment company under the Investment Company Act. The Statement of Additional Information (SAI) includes additional information about fund directors and is available upon request without charge by calling 800-677-FUND or writing to First American Funds, P.O. Box 1330, Minneapolis, Minnesota, 55440-1330. 33 Officers
POSITION(S) TERM OF OFFICE NAME, ADDRESS, AND HELD AND LENGTH OF YEAR OF BIRTH WITH FUND TIME SERVED PRINCIPAL OCCUPATION(S) DURING PAST 5 YEARS - ----------------------------------------------------------------------------------------------------------------------------------- Thomas S. Schreier, Jr., President Re-elected by the Board Chief Executive Officer of U.S. Bancorp Asset U.S. Bancorp Asset annually; President of Management, Inc. since May 2001; Chief Management, Inc., FAF since February 2001 Executive Officer of First American Asset 800 Nicollet Mall, Management from December 2000 through May Minneapolis, MN 2001 and of Firstar Investment & Research 55402 (1962) * Management Company from February 2001 through May 2001; Senior Managing Director and Head of Equity Research of U.S. Bancorp Piper Jaffray from October 1998 through December 2000; prior to October 1998, Senior Airline Equity Analyst and a Director in the Equity Research Department, Credit Suisse First Boston Mark S. Jordahl, Vice Re-elected by the Board Chief Investment Officer of U.S. Bancorp U.S. Bancorp Asset President - annually; Vice President - Asset Management, Inc. since September 2001; Management, Inc. Investments Investments of FAF President and Chief Investment Officer, ING 800 Nicollet Mall, since September 2001 Investment Management - Americas, September Minneapolis, MN 2000 to June 2001; Senior Vice President and 55402 (1960) * Chief Investment Officer, ReliaStar Financial Corp., January 1998 to September 2000 Jeffery M. Wilson, Vice Re-elected by the Board Senior Vice President of U.S. Bancorp Asset U.S. Bancorp Asset President - annually; Vice President - Management since May 2001; prior thereto, Management, Inc. Administration Administration of FAF Senior Vice President of First American Asset 800 Nicollet Mall, since March 2000 Management Minneapolis, MN 55402 (1956) * Robert H. Nelson, Treasurer Re-elected by the Board Senior Vice President of U.S. Bancorp Asset U.S. Bancorp Asset annually; Treasurer of Management since May 2001; prior thereto, Management, Inc. FAF since March 2000 Senior Vice President of First American Asset 800 Nicollet Mall, Management since 1998 and of Firstar Minneapolis, MN Investment & Research Management Company 55402 (1963) * since February 2001; Senior Vice President of Piper Capital Management Inc. through 1998 James D. Alt, Secretary Re-elected by the Board Partner, Dorsey & Whitney LLP, a Minneapolis- 50 South Sixth Street, annually; Assistant based law firm Suite 1500, Secretary of FAF from Minneapolis, MN September 1998 through 55402 (1951) June 2002. Secretary of FAF since June 2002 Michael J. Radmer, Assistant Re-elected by the Board Partner, Dorsey & Whitney LLP, a Minneapolis- 50 South Sixth Street, Secretary annually; Assistant based law firm Suite 1500, Secretary of FAF since Minneapolis, MN March 2000; Secretary of 55402 (1945) FAF from September 1999 through March 2000 Kathleen L. Prudhomme, Assistant Re-elected by the Board Partner, Dorsey & Whitney LLP, a Minneapolis- 50 South Sixth Street, Secretary annually; Assistant based law firm Suite 1500, Secretary of FAF since Minneapolis, MN September 1998 55402 (1953) James R. Arnold, Assistant Re-elected by the Board Vice President, U.S. Bancorp Fund Services, 615 E. Michigan Street, Secretary annually; Assistant LLC since March 2002; Senior Administration Milwaukee, WI Secretary of FAF since Services Manager, UMB Fund Services, Inc. 53202 (1957) * June 2003 through March 2002 Richard J. Ertel, Assistant Re-elected by the Board Disclosure Counsel, U.S. Bancorp Asset U.S. Bancorp Asset Secretary annually; Assistant Management, Inc. since May 2003; Associate Management, Inc. Secretary of FAF since Counsel, Hartford Life and Accident Insurance 800 Nicollet Mall, June 2003 Company from April 2001 through May 2003; Minneapolis, MN Attorney and Law Clerk, Fortis Financial 55402 (1967) * Group, through March 2001 Douglas G. Hess, Assistant Re-elected by the Board Vice President, U.S. Bancorp Fund Services, LLC 615 E. Michigan Street, Secretary annually; Assistant since November 2002; prior thereto, Assistant Milwaukee, WI Secretary of FAF since Vice President, Fund Compliance Administrator, 53202 (1967) * September 2001 U.S. Bancorp Fund Services, LLC
* Messrs. Schreier, Jordahl, Wilson, Nelson, and Ertel are each officers of U.S. Bancorp Asset Management, Inc., which serves as investment advisor and co-administrator for FAF. Messrs. Hess and Arnold are officers of U.S. Bancorp Fund Services, LLC, which is a subsidiary of U.S. Bancorp and which serves as co-administrator for FAF. 34 Board of Directors First American Funds, Inc. Virginia Stringer Chairperson of First American Funds, Inc. Owner and President of Strategic Management Resources, Inc. Benjamin Field III Director of First American Funds, Inc. Senior Financial Advisor to, and formerly Senior Vice President, Chief Financial Officer, and Treasurer of, Bemis Company, Inc. Mickey Foret Director of First American Funds, Inc. Consultant to, and formerly Executive Vice President and Chief Financial Officer of, Northwest Airlines, Inc. Roger Gibson Director of First American Funds, Inc. Vice President, Cargo-United Airlines Victoria Herget Director of First American Funds, Inc. Investment Consultant; former Managing Director of Zurich Scudder Investments Leonard Kedrowski Director of First American Funds, Inc. Owner and President of Executive and Management Consulting, Inc. Richard Riederer Director of First American Funds, Inc. Retired; former President and Chief Executive Officer of Weirton Steel Joseph Strauss Director of First American Funds, Inc. Former Chairman of First American Funds, Inc. Owner and President of Strauss Management Company James Wade Director of First American Funds, Inc. Owner and President of Jim Wade Homes FIRST AMERICAN FUNDS' BOARD OF DIRECTORS IS COMPRISED ENTIRELY OF INDEPENDENT DIRECTORS. [FIRST AMERICAN FUNDS LOGO] DIRECT FUND CORRESPONDENCE TO: FIRST AMERICAN FUNDS P.O. Box 1330 Minneapolis, MN 55440-1330 This report and the financial statements contained herein are submitted for the general information of the shareholders of the corporation and are not intended to be a forecast of future events, a guarantee of future results, nor investment advice. Further, there is no assurance that certain securities will remain in or out of each Fund's portfolio. Please refer to the enclosed prospectus, which contains more complete information on First American Funds, including risks, fees, and expenses. Please read it carefully before investing or sending money. This report must be preceded or accompanied by the prospectus. Past performance does not guarantee future results. The 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. INVESTMENT ADVISOR U.S. BANCORP ASSET MANAGEMENT, INC. 800 Nicollet Mall Minneapolis, Minnesota 55402 CO-ADMINISTRATORS U.S. BANCORP ASSET MANAGEMENT, INC. 800 Nicollet Mall Minneapolis, Minnesota 55402 U.S. BANCORP FUND SERVICES, LLC 615 East Michigan Street Milwaukee, Wisconsin 53202 CUSTODIAN U.S. BANK NATIONAL ASSOCIATION 180 East Fifth Street St. Paul, Minnesota 55101 DISTRIBUTOR QUASAR DISTRIBUTORS, LLC 615 East Michigan Street Milwaukee, Wisconsin 53202 INDEPENDENT AUDITORS ERNST & YOUNG LLP 220 South Sixth Street Suite 1400 Minneapolis, Minnesota 55402 COUNSEL DORSEY & WHITNEY LLP 50 South Sixth Street Suite 1500 Minneapolis, Minnesota 55402 FIRST AMERICAN FUNDS P.O. Box 1330 Minneapolis, MN 55440-1330 In an attempt to reduce shareholder costs and help eliminate duplication, First American Funds will try to limit their mailing to one report for each address that lists one or more shareholders with the same last name. If you would like additional copies, please call First American Investor Services at 800.677.FUND or visit firstamericanfunds.com. 0210-03 11/2003 AR-MMY Bulk Rate U.S. Postage Paid Mpls. MN Permit No. 28388 USPS Mailer 881 Approved Poly ITEM 2--CODE OF ETHICS RESPONSE: The registrant has adopted a code of ethics (designated as the "Code of Ethical Conduct") that applies to its principal executive officer and principal financial officer. The registrant undertakes to furnish a copy of such Code of Ethical Conduct to any person upon request, without charge, by calling 1-800-677-3863. ITEM 3--AUDIT COMMITTEE FINANCIAL EXPERT RESPONSE: The registrant's Board of Directors has determined that Leonard Kedrowski, Benjamin Field, and Mickey Foret, members of the registrant's Audit Committee, are each an "audit committee financial expert" and are "independent," as these terms are defined in this Item. This designation will not increase the designees' duties, obligations or liability as compared to their duties, obligations and liability as members of the Audit Committee and of the Board of Directors. ITEM 4--PRINCIPAL ACCOUNTANT FEES AND SERVICES RESPONSE: Not required for annual reports filed for periods ending before December 15, 2003. ITEM 5--AUDIT COMMITTEE OF LISTED REGISTRANTS RESPONSE: Not applicable to the registrant. ITEM 6 - Reserved. ITEM 7--DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES RESPONSE: Not applicable to the registrant. ITEM 8 - Reserved. ITEM 9--CONTROLS AND PROCEDURES (a) RESPONSE: The registrant's Principal Executive Officer and Principal Financial Officer have evaluated the registrant's disclosure controls and procedures within 90 days of the date of this filing and have concluded that the registrant's disclosure controls and procedures were effective, as of that date, in ensuring that information required to be disclosed by the registrant in this Form N-CSR was recorded, processed, summarized and reported timely. Notwithstanding this conclusion, the registrant's Principal Executive Officer and Principal Financial Officer seek continuous improvements to the registrant's disclosure controls and procedures. (b) RESPONSE: There were no changes in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting. ITEM 10 - EXHIBITS 10(a) - Code of Ethical Conduct RESPONSE: Attached hereto. 10(b) - Attach certifications (4 in total pursuant to Sections 302 and 906 for PEO/PFO). RESPONSE: Attached hereto. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. First American Funds, Inc. By /s/ Thomas S. Schreier, Jr. --------------------------- Thomas S. Schreier, Jr. President Date: December 8, 2003 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By /s/ Thomas S. Schreier, Jr. --------------------------- Thomas S. Schreier, Jr. President Date: December 8, 2003 By /s/ Jonathan P. Lillemoen ---------------------- Jonathan P. Lillemoen Director, USBAM Fund Treasury Date: December 8, 2003 EX-99.CODE 3 a2122205zex-99_code.txt EX-99.CODE EX-99.CODE ETH CODE OF ETHICAL CONDUCT OF FIRST AMERICAN FUNDS, INC. FIRST AMERICAN INVESTMENT FUNDS, INC. FIRST AMERICAN STRATEGY FUNDS, INC. FIRST AMERICAN INSURANCE PORTFOLIOS, INC. AMERICAN MUNICIPAL INCOME PORTFOLIO INC. MINNESOTA MUNICIPAL INCOME PORTFOLIO INC. FIRST AMERICAN MINNESOTA MUNICIPAL INCOME FUND II, INC. AMERICAN INCOME FUND, INC. AMERICAN STRATEGIC INCOME PORTFOLIO INC. AMERICAN STRATEGIC INCOME PORTFOLIO INC. II AMERICAN STRATEGIC INCOME PORTFOLIO INC. III AMERICAN SELECT PORTFOLIO INC. I. COVERED OFFICERS/PURPOSE OF THE CODE The First American Funds' Code of Ethical Conduct (this "Code") for the investment companies within the complex (collectively, "Funds" and each, "Company") applies to each such Company's officers (the "Covered Officers", a list of which is set forth in Exhibit A) for the purpose of promoting: - honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships; - full, fair, accurate, timely and understandable disclosure in reports and documents that a registrant files with, or submits to, the SEC and in other public communications made by a Company; - compliance with applicable laws and governmental rules and regulations; - the prompt internal reporting of violations of the Code to an appropriate person or persons identified in the Code; and - accountability for adherence to the Code. Each Covered Officer should adhere to a high standard of business ethics and should be sensitive to situations that may give rise to actual as well as apparent conflicts of interest. The Code also applies to each Covered Officer's immediate family members as long as they are living in the same household. Therefore, for purposes of interpretation, each obligation, requirement or prohibition that applies to a Covered Officer also applies to such Covered Officer's family members. Currently, all Covered Officers are employees of affiliated Company service providers- the Funds' investment advisor and co-administrator, U.S. Bancorp Asset Management, Inc. ("USBAM"), and the Funds' other co-administrator, U.S. Bancorp Fund Services ("USBFS"). The phrase "Covered Officers" does not include partners of Dorsey & Whitney, the Funds' outside counsel. II. COVERED OFFICERS SHOULD HANDLE ETHICALLY ACTUAL AND APPARENT CONFLICTS OF INTEREST OVERVIEW. A "conflict of interest" occurs when a Covered Officer's private interest interferes with the interests of, or his service to, a Company. For example, a conflict of interest would arise if a Covered Officer, or a member of his family, receives improper personal benefits as a result of his position in the Company. Certain conflicts of interest covered by this Code arise out of the relationships between Covered Officers and a Company and already are subject to conflict of interest provisions in the Investment Company Act of 1940 ("Investment Company Act") and the Investment Advisers Act of 1940 ("Investment Advisers Act"). For example, Covered Officers may not individually engage in certain transactions (such as the purchase or sale of securities or other property) with the Company because of their status as "affiliated persons" of a Company. The Company's and USBAM's compliance programs and procedures are designed to prevent, or identify and correct, violations of these provisions. THIS CODE DOES NOT, AND IS NOT INTENDED TO, REPEAT OR REPLACE THESE PROGRAMS AND PROCEDURES AND SUCH CONFLICTS FALL OUTSIDE OF THE PARAMETERS OF THIS CODE. Although typically not presenting an opportunity for improper personal benefit, conflicts arise from, or as a result of, the contractual relationship between a Company and USBAM/USBFS of which the Covered Officers are also officers or employees. As a result, this Code recognizes that the Covered Officers will, in the normal course of their duties (whether formally for a Company or for the adviser/administrator, or for all), be involved in establishing policies and implementing decisions which will have different effects on the adviser/administrator and the Company. The participation of the Covered Officers in such activities is inherent in the contractual relationship between the Company and the adviser/administrator and is consistent with the performance by the Covered Officers of their duties as officers of a Company. Thus, if performed in conformity with the provisions of the Investment Company Act and the Investment Advisers Act, such activities will be deemed to have been handled ethically. In addition, it is recognized by the Funds' Board of Directors that the Covered Officers may also be officers or employees of one or more other investment companies covered by this or other Codes. Other conflicts of interest are covered by the Code, even if such conflicts of interest are not subject to provisions in the Investment Company Act and the Investment Advisers Act. The following list provides examples of conflicts of interest under the Code, but Covered Officers should keep in mind that these examples are not exhaustive. THE OVERARCHING PRINCIPLE IS THAT THE PERSONAL INTEREST OF A COVERED OFFICER SHOULD NOT BE PLACED IMPROPERLY BEFORE THE INTEREST OF A COMPANY. Each Covered Officer must: - not use his personal influence or personal relationships improperly to influence investment decisions or financial reporting by a Company whereby the Covered Officer would benefit personally; - not cause a Company to take action, or fail to take action, for the individual personal benefit of the Covered Officer rather than the benefit of such Company; - not intentionally or recklessly take or direct any action or failure to act that results in any SEC filing or other public Company communication being materially misleading, while personally benefiting such Covered Officer; and, - not request cash or gifts, including any entertainment or similar benefit, from any firm or party, with which a Company has current or prospective business dealings, including Company directors, Fund affiliates and service providers. There are some conflicts of interest situations that should always be reviewed with the adviser's General Counsel. These include, but are not limited to: - the receipt of cash or GIFTS IN EXCESS OF $100 from any one firm or party, including Company directors, Fund affiliates and service providers, with which a Company has current or prospective business dealings; - the receipt of any ENTERTAINMENT OR SIMILAR BENEFIT from any firm or party, including Company directors, Fund affiliates and service providers, with which a Company has current or prospective business dealings unless such entertainment is reasonable in cost, appropriate as to time and place, includes a representative of the firm or party, and not so frequent as to raise any question of impropriety; - any ownership interest in, or any consulting or employment relationship with, any Company service providers, other than its investment adviser, principal underwriter, administrator or any affiliated person thereof; and - a direct or indirect financial interest in commissions, transactions charges or spreads paid by a Company for effecting portfolio transactions or for selling or redeeming shares other than an interest arising from the Covered Officer's employment, such as compensation or equity ownership. In all instances, Covered Officers are expected to use reason, judgement and common sense to avoid any question or appearance of impropriety. Covered Officers should seek the assistance of the adviser's General Counsel in case of questions. III. DISCLOSURE AND COMPLIANCE - Each Covered Officer must familiarize himself with the disclosure requirements generally applicable to a Company; - each Covered Officer should not knowingly misrepresent, or cause others to misrepresent, facts about a Company to others, whether within or outside a Company, including to a Company's directors and auditors, and to governmental regulators and self-regulatory organizations; - each Covered Officer should, to the extent appropriate within his area of responsibility, consult with other officers and employees of the Funds and the adviser with the goal of promoting full, fair, accurate, timely and understandable disclosure in the reports and documents the Funds file with, or submit to, the SEC and in other public communications made by the Funds; and - it is the responsibility of each Covered Officer to promote compliance with the standards and restrictions imposed by applicable laws, rules and regulations. IV. REPORTING AND ACCOUNTABILITY Each Covered Officer must: - upon adoption of the Code or upon being made subject to the Code, affirm in writing to the Funds' Board that such Covered Officer has received, read, and understands the Code; - annually affirm in writing to the Funds' Board that such Covered Officer has complied with the requirements of the Code; - annually report in writing to USBAM's Compliance Department all affiliations that might give rise to a conflict of interest with respect to such person's status as a Covered Officer; - quarterly report to USBAM's Compliance Department the following: - all cash and gifts with a value in excess of $100 received from any firm or party that has current or prospective business dealings with a Company; - all receipt of any entertainment or similar benefit from any firm or party, including Company directors, Fund affiliates and service providers, with which a Company has current or prospective business dealings; - not retaliate against any Fund affiliate employee, service provider employee or Covered Officer for reports of potential violations that are made in good faith; and - notify USBAM's General Counsel promptly if he knows of any violation of this Code. Failure to do so is itself a violation of this Code. USBAM's General Counsel is responsible for applying this Code to specific situations in which questions are presented under it and has the authority to interpret this Code in any particular situation. In doing so, such General Counsel is authorized and encouraged to consult with Company counsel and counsel to the Company's independent directors. However, approvals, interpretations, or waivers sought by a Company's President will be considered by such Company's Qualified Legal Compliance Committee (the "Committee"). The Funds will follow these procedures in investigating and enforcing this Code: - the General Counsel will take all appropriate action to investigate any violations and potential violations reported to it; - if, after such investigation, the General Counsel reasonably believes that no violation has occurred, the General Counsel is not required to take any further action and such conclusion will be documented and reported to the Committee at its next regularly scheduled meeting; - any matter the General Counsel believes is a violation will be reported in writing to the Committee; - if the Committee concurs that a violation has occurred, it will inform and make a recommendation to the Board, which will consider appropriate action, which may include review of, and appropriate modifications to, applicable policies and procedures; notification of the appropriate supervisory executives of either the investment adviser, the applicable service provider, or any applicable parent company thereof; or a recommendation to dismiss the Covered Officer; - the Committee will be responsible for granting waivers (defined as a material departure from a provision of this Code), as appropriate; and - any changes to or waivers of this Code will, to the extent required, be disclosed as provided by SEC rules. V. OTHER POLICIES AND PROCEDURES This Code shall be the sole code of ethics adopted by the Funds for purposes of Section 406 of the Sarbanes-Oxley Act and the rules and forms applicable to registered investment companies thereunder. USBAM's code of ethics under Rule 17j-1 under the Investment Company Act, USBAM's more detailed operational and regulatory compliance policies and procedures, and U.S. Bancorp's Code of Ethics are separate requirements applying to the Covered Officers and others, and are not specifically a part of this Code. VI. AMENDMENTS Any amendments to this Code, other than amendments to Exhibit A, must be approved or ratified by a majority vote of the Company's board, including a majority of independent directors. VII. CONFIDENTIALITY All reports and records prepared or maintained pursuant to this Code will be considered confidential and shall be maintained and protected accordingly. Except as otherwise required by law or this Code, such matters shall not be disclosed to anyone other than the Company Board, Company counsel, counsel to the independent directors, USBAM's Compliance Department, and the appropriate senior managers of USBAM and its affiliates. VIII. INTERNAL USE The Code is intended solely for the internal use by the Funds and does not constitute an admission, by or on behalf of any Company, as to any fact, circumstance, or legal conclusion. Date: 2003 EX-99.CERT 4 a2122205zex-99_cert.txt EX-99.CERT EX-99.CERT CERTIFICATIONS PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 I, Thomas S. Schreier, Jr., certify that: 1. I have reviewed this report on Form N-CSR of First American Funds, 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 officers 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) 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) 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 c) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual 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 officers 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: December 8, 2003 /s/ Thomas S. Schreier, Jr. - ---------------------------- Thomas S. Schreier, Jr. President I, Jonathan P. Lillemoen, certify that: 1. I have reviewed this report on Form N-CSR of First American Funds, 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 officers 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) 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) 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 c) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual 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 officers 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: December 8, 2003 /s/ Jonathan P. Lillemoen - ---------------------- Jonathan P. Lillemoen Director, USBAM Fund Treasury EX-99.906CERT CERTIFICATIONS PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 Pursuant to section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. section 1350), the undersigned officers of First American Funds, Inc. (the "Funds") do hereby certify, to the best of each such officer's knowledge, that: 1. The N-CSR of the Fund (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of the operations of the Fund. By /s/ Thomas S. Schreier, Jr. --------------------------- Thomas S. Schreier, Jr. President Date: December 8, 2003 By /s/ Jonathan P. Lillemoen --------------------------- Jonathan P. Lillemoen Director, USBAM Fund Treasury Date: December 8, 2003 -----END PRIVACY-ENHANCED MESSAGE-----