-----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, VS+yxpsvM7f2f1rrdP+3hcgo2k2gxkO156XwaJvnnlT4ztoKDct7PQzzVTaxvGe+ jGD3Y9d5e/r7Bro7BNr0lg== 0000950123-10-032324.txt : 20100406 0000950123-10-032324.hdr.sgml : 20100406 20100406112116 ACCESSION NUMBER: 0000950123-10-032324 CONFORMED SUBMISSION TYPE: N-CSRS PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20100131 FILED AS OF DATE: 20100406 DATE AS OF CHANGE: 20100406 EFFECTIVENESS DATE: 20100406 FILER: COMPANY DATA: COMPANY CONFORMED NAME: RIVERSOURCE LARGE CAP SERIES, INC. CENTRAL INDEX KEY: 0000049702 IRS NUMBER: 410962638 STATE OF INCORPORATION: MN FISCAL YEAR END: 0731 FILING VALUES: FORM TYPE: N-CSRS SEC ACT: 1940 Act SEC FILE NUMBER: 811-02111 FILM NUMBER: 10733500 BUSINESS ADDRESS: STREET 1: 50606 AMERIPRISE FINANCIAL CENTER STREET 2: H27/5228 CITY: MINNEAPOLIS STATE: MN ZIP: 55474 BUSINESS PHONE: 612-671-4321 MAIL ADDRESS: STREET 1: 50606 AMERIPRISE FINANCIAL CENTER STREET 2: H27/5228 CITY: MINNEAPOLIS STATE: MN ZIP: 55474 FORMER COMPANY: FORMER CONFORMED NAME: AXP GROWTH SERIES INC/MN DATE OF NAME CHANGE: 20001011 FORMER COMPANY: FORMER CONFORMED NAME: AXP GROWTH FUND INC DATE OF NAME CHANGE: 20000829 FORMER COMPANY: FORMER CONFORMED NAME: IDS GROWTH FUND INC DATE OF NAME CHANGE: 19920703 0000049702 S000003287 RiverSource Disciplined Equity Fund C000008741 RiverSource Disciplined Equity Fund Class B AQEBX C000008742 RiverSource Disciplined Equity Fund Class C RDCEX C000008744 RiverSource Disciplined Equity Fund Class A AQEAX C000008745 RiverSource Disciplined Equity Fund Class I ALEIX C000042888 RiverSource Disciplined Equity Fund Class R2 C000042889 RiverSource Disciplined Equity Fund Class R3 RSDEX C000042890 RiverSource Disciplined Equity Fund Class R4 RQEYX C000042891 RiverSource Disciplined Equity Fund Class R5 RSIPX C000042892 RiverSource Disciplined Equity Fund Class W RDEWX N-CSRS 1 c56465nvcsrs.txt N-CSRS 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 811-2111 RIVERSOURCE LARGE CAP SERIES, INC. (Exact name of registrant as specified in charter) 50606 Ameriprise Financial Center, Minneapolis, Minnesota 55474 (Address of principal executive offices) (Zip code) Scott R. Plummer - 5228 Ameriprise Financial Center, Minneapolis, MN 55474 (Name and address of agent for service) Registrant's telephone number, including area code: (612) 671-1947 Date of fiscal year end: 7/31 Date of reporting period: 1/31 Semiannual Report (RIVERSOURCE INVESTMENTS LOGO) RIVERSOURCE DISCIPLINED EQUITY FUND SEMIANNUAL REPORT FOR THE PERIOD ENDED JANUARY 31, 2010 RIVERSOURCE DISCIPLINED EQUITY FUND SEEKS TO PROVIDE SHAREHOLDERS WITH LONG-TERM CAPITAL GROWTH. (SINGLE STRATEGY FUNDS ICON) TABLE OF CONTENTS -------------------------------------------------------------- Your Fund at a Glance.............. 2 Fund Expenses Example.............. 6 Portfolio of Investments........... 9 Statement of Assets and Liabilities...................... 23 Statement of Operations............ 25 Statements of Changes in Net Assets........................... 27 Financial Highlights............... 29 Notes to Financial Statements...... 38 Proxy Voting....................... 57
- -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 1 YOUR FUND AT A GLANCE ---------------------------------------------------------- (UNAUDITED) FUND SUMMARY - -------------------------------------------------------------------------------- > RiverSource Disciplined Equity Fund (the Fund) Class A shares gained 9.46% (excluding sales charge) for the six months ended Jan. 31, 2010. > The Fund underperformed its benchmark, the unmanaged Standard & Poor's (S&P) 500 Index, which rose 9.87% during the same period. > The Fund outperformed the Lipper Large-Cap Core Funds Index, representing the Fund's peer group, which increased 9.05%, for the same period. ANNUALIZED TOTAL RETURNS (for period ended Jan. 31, 2010) - --------------------------------------------------------------------------------
SINCE INCEPTION 6 MONTHS* 1 YEAR 3 YEARS 5 YEARS 4/24/03 - ------------------------------------------------------------------------------ RiverSource Disciplined Equity Fund Class A (excluding sales charge) +9.46% +31.48% -9.57% -0.94% +3.56% - ------------------------------------------------------------------------------ S&P 500 Index(1) (unmanaged) +9.87% +33.14% -7.24% +0.18% +4.51% - ------------------------------------------------------------------------------ Lipper Large-Cap Core Funds Index(2) +9.05% +34.08% -6.53% +0.36% +3.95% - ------------------------------------------------------------------------------
* Not annualized. The performance information shown represents past performance and is not a guarantee of future results. The investment return and principal value of your investment will fluctuate so that your shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance information shown. You may obtain performance information current to the most recent month-end by contacting your financial intermediary, visiting riversource.com/funds or calling 1(800) 221-2450. The 5.75% sales charge applicable to Class A shares of the Fund is not reflected in the table above. If reflected, returns would be lower than those shown. The performance of other classes may vary from that shown because of differences in fees and expenses. The Fund's returns reflect the effect of fee waivers/expense reimbursements, if any. Without such waivers/reimbursements, the Fund's returns would be lower. See the Average Annual Total Returns table for performance of other share classes of the Fund. The indices do not reflect the effects of sales charges, expenses (excluding Lipper) and taxes. It is not possible to invest directly in an index. (1) The Standard & Poor's 500 Index (S&P 500 Index), an unmanaged index of common stocks, is frequently used as a general measure of market performance. The index reflects reinvestment of all distributions and changes in market prices. (2) The Lipper Large-Cap Core Funds Index includes the 30 largest large-cap core funds tracked by Lipper Inc. The index's returns include net reinvested dividends. The Fund's performance is currently measured against this index for purposes of determining the performance incentive adjustment. - -------------------------------------------------------------------------------- 2 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT - -------------------------------------------------------------------------------- AVERAGE ANNUAL TOTAL RETURNS - --------------------------------------------------------------------------------
AT JAN. 31, 2010 SINCE Without sales charge 6 MONTHS* 1 YEAR 3 YEARS 5 YEARS INCEPTION Class A (inception 4/24/03) +9.46% +31.48% -9.57% -0.94% +3.56% - -------------------------------------------------------------------------- Class B (inception 4/24/03) +8.95% +30.68% -10.22% -1.71% +2.76% - -------------------------------------------------------------------------- Class C (inception 4/24/03) +8.85% +30.37% -10.26% -1.72% +2.75% - -------------------------------------------------------------------------- Class I (inception 7/15/04) +9.58% +31.80% -9.24% -0.57% +0.99% - -------------------------------------------------------------------------- Class R2 (inception 12/11/06) +9.11% +31.06% -9.80% N/A -8.83% - -------------------------------------------------------------------------- Class R3 (inception 12/11/06) +9.35% +31.35% -9.55% N/A -8.60% - -------------------------------------------------------------------------- Class R4 (inception 4/24/03) +9.58% +31.86% -9.40% -0.77% +3.74% - -------------------------------------------------------------------------- Class R5 (inception 12/11/06) +9.60% +31.94% -9.28% N/A -8.30% - -------------------------------------------------------------------------- Class W (inception 12/1/06) +9.35% +31.41% -9.66% N/A -8.20% - -------------------------------------------------------------------------- With sales charge Class A (inception 4/24/03) +3.17% +23.93% -11.34% -2.11% +2.65% - -------------------------------------------------------------------------- Class B (inception 4/24/03) +3.95% +25.68% -11.02% -2.02% +2.76% - -------------------------------------------------------------------------- Class C (inception 4/24/03) +7.85% +29.37% -10.26% -1.72% +2.75% - --------------------------------------------------------------------------
Class A share performance reflects the maximum initial sales charge of 5.75%. Class B share performance reflects a contingent deferred sales charge (CDSC) applied as follows: first year 5%; second year 4%; third and fourth years 3%; fifth year 2%; sixth year 1%; no sales charge thereafter. Class C shares may be subject to a 1% CDSC if shares are sold within one year after purchase. Sales charges do not apply to Class I, Class R2, Class R3, Class R4, Class R5 and Class W shares. Class I, Class R2, Class R3, Class R4 and Class R5 are available to qualifying institutional investors only. Class W shares are offered through qualifying discretionary accounts. * Not annualized. - -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 3 YOUR FUND AT A GLANCE (continued) ---------------------------------------------- STYLE MATRIX - --------------------------------------------------------------------------------
STYLE VALUE BLEND GROWTH X LARGE MEDIUM SIZE SMALL
Shading within the style matrix approximates areas in which the Fund is designed to generally invest. The style matrix can be a valuable tool for constructing and monitoring your portfolio. It provides a frame of reference for distinguishing the types of stocks or bonds owned by a mutual fund, and may serve as a guideline for helping you build a portfolio. Investment products, including shares of mutual funds, are not federally or FDIC-insured, are not deposits or obligations of, or guaranteed by any financial institution, and involve investment risks including possible loss of principal and fluctuation in value. PORTFOLIO BREAKDOWN(1) (at Jan. 31, 2010) - ---------------------------------------------------------------------
STOCKS 99.8% - ------------------------------------------------ Consumer Discretionary 7.8% - ------------------------------------------------ Consumer Staples 5.6% - ------------------------------------------------ Energy 12.8% - ------------------------------------------------ Financials 19.4% - ------------------------------------------------ Health Care 18.2% - ------------------------------------------------ Industrials 7.4% - ------------------------------------------------ Information Technology 18.4% - ------------------------------------------------ Materials 3.7% - ------------------------------------------------ Telecommunication Services 4.1% - ------------------------------------------------ Utilities 2.4% - ------------------------------------------------ EQUITY-LINKED NOTES --% - ------------------------------------------------ EXCHANGE TRADED FUNDS 0.2% - ------------------------------------------------ OTHER(2) --% - ------------------------------------------------
(1) Sectors can be comprised of several industries. Please refer to the section entitled "Portfolio of Investments" for a complete listing. No single industry exceeds 25% of portfolio assets. Percentages indicated are based upon total investments (excluding Investments of Cash Collateral Received for Securities on Loan). The Fund's composition is subject to change. (2) Cash & Cash Equivalents. The sectors identified above are based on the Global Industry Classification Standard (GICS), which was developed by and is the exclusive property of Morgan Stanley Capital International Inc. and Standard & Poor's, a division of The McGraw-Hill Companies, Inc. - -------------------------------------------------------------------------------- 4 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT - -------------------------------------------------------------------------------- TOP TEN HOLDINGS(1) (at Jan. 31, 2010) - ---------------------------------------------------------------------
Apple 5.8% - ------------------------------------------------ Pfizer 5.2% - ------------------------------------------------ Chevron 4.9% - ------------------------------------------------ Johnson & Johnson 3.2% - ------------------------------------------------ Bank of America 2.7% - ------------------------------------------------ Goldman Sachs Group 2.7% - ------------------------------------------------ AT&T 2.5% - ------------------------------------------------ General Electric 2.4% - ------------------------------------------------ ConocoPhillips 2.1% - ------------------------------------------------ Merck & Co 2.0% - ------------------------------------------------
(1) Percentages indicated are based upon total investments (excluding Investments of Cash Collateral Received for Securities on Loan and Cash & Cash Equivalents). For further detail about these holdings, please refer to the section entitled "Portfolio of Investments." Fund holdings are as of the date given, are subject to change at any time, and are not recommendations to buy or sell any security. - -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 5 FUND EXPENSES EXAMPLE ---------------------------------------------------------- (UNAUDITED) As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments; and (2) ongoing costs, which may include management fees; distribution and service (12b-1) fees; and other Fund fees and expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. In addition to the ongoing expenses which the Fund bears directly, the Fund's shareholders indirectly bear the ongoing expenses of any funds in which the Fund invests (also referred to as "acquired funds"), including affiliated and non- affiliated pooled investment vehicles (including mutual funds and exchange traded funds). The Fund's indirect expense from investing in the acquired funds is based on the Fund's pro rata portion of the ongoing expenses charged by acquired funds using the expense ratio of each of the acquired funds as of the acquired fund's most recent shareholder report. The example is based on an investment of $1,000 invested at the beginning of the period and held for the six months ended Jan. 31, 2010. ACTUAL EXPENSES The first line of the table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading titled "Expenses paid during the period" to estimate the expenses you paid on your account during this period. HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES The second line of the table provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads). Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher. - -------------------------------------------------------------------------------- 6 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT - --------------------------------------------------------------------------------
BEGINNING ENDING EXPENSES ACCOUNT VALUE ACCOUNT VALUE PAID DURING ANNUALIZED AUG. 1, 2009 JAN. 31, 2010 THE PERIOD(a) EXPENSE RATIO - ------------------------------------------------------------------------------------------ Class A - ------------------------------------------------------------------------------------------ Actual(b) $1,000 $1,094.60 $5.01 .96% - ------------------------------------------------------------------------------------------ Hypothetical (5% return before expenses) $1,000 $1,020.14 $4.84 .96% - ------------------------------------------------------------------------------------------ Class B - ------------------------------------------------------------------------------------------ Actual(b) $1,000 $1,089.50 $9.06 1.74% - ------------------------------------------------------------------------------------------ Hypothetical (5% return before expenses) $1,000 $1,016.26 $8.75 1.74% - ------------------------------------------------------------------------------------------ Class C - ------------------------------------------------------------------------------------------ Actual(b) $1,000 $1,088.50 $8.96 1.72% - ------------------------------------------------------------------------------------------ Hypothetical (5% return before expenses) $1,000 $1,016.36 $8.65 1.72% - ------------------------------------------------------------------------------------------ Class I - ------------------------------------------------------------------------------------------ Actual(b) $1,000 $1,095.80 $2.56 .49% - ------------------------------------------------------------------------------------------ Hypothetical (5% return before expenses) $1,000 $1,022.49 $2.47 .49% - ------------------------------------------------------------------------------------------ Class R2 - ------------------------------------------------------------------------------------------ Actual(b) $1,000 $1,091.10 $6.88 1.32% - ------------------------------------------------------------------------------------------ Hypothetical (5% return before expenses) $1,000 $1,018.35 $6.64 1.32% - ------------------------------------------------------------------------------------------ Class R3 - ------------------------------------------------------------------------------------------ Actual(b) $1,000 $1,093.50 $5.48 1.05% - ------------------------------------------------------------------------------------------ Hypothetical (5% return before expenses) $1,000 $1,019.70 $5.29 1.05% - ------------------------------------------------------------------------------------------ Class R4 - ------------------------------------------------------------------------------------------ Actual(b) $1,000 $1,095.80 $4.18 .80% - ------------------------------------------------------------------------------------------ Hypothetical (5% return before expenses) $1,000 $1,020.94 $4.03 .80% - ------------------------------------------------------------------------------------------ Class R5 - ------------------------------------------------------------------------------------------ Actual(b) $1,000 $1,096.00 $2.98 .57% - ------------------------------------------------------------------------------------------ Hypothetical (5% return before expenses) $1,000 $1,022.09 $2.87 .57% - ------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 7 FUND EXPENSES EXAMPLE (continued) ----------------------------------------------
BEGINNING ENDING EXPENSES ACCOUNT VALUE ACCOUNT VALUE PAID DURING ANNUALIZED AUG. 1, 2009 JAN. 31, 2010 THE PERIOD(a) EXPENSE RATIO - ------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------ Class W - ------------------------------------------------------------------------------------------ Actual(b) $1,000 $1,093.50 $4.91 .94% - ------------------------------------------------------------------------------------------ Hypothetical (5% return before expenses) $1,000 $1,020.24 $4.73 .94% - ------------------------------------------------------------------------------------------
(a) Expenses are equal to the annualized expense ratio for each class as indicated above, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period). (b) Based on the actual return for the six months ended Jan. 31, 2010: +9.46% for Class A, +8.95% for Class B, +8.85% for Class C, +9.58% for Class I, +9.11% for Class R2, +9.35% for Class R3, +9.58% for Class R4, +9.60% for Class R5 and +9.35% for Class W. - -------------------------------------------------------------------------------- 8 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT PORTFOLIO OF INVESTMENTS ------------------------------------------------------- JAN. 31, 2010 (UNAUDITED) (Percentages represent value of investments compared to net assets) INVESTMENTS IN SECURITIES
COMMON STOCKS (99.3%) ISSUER SHARES VALUE(a) AEROSPACE & DEFENSE (2.2%) General Dynamics 342,776 $22,914,575 Goodrich 61,508 3,807,960 ITT 54,267 2,621,639 Lockheed Martin 245,390 18,286,463 Northrop Grumman 253,953(e) 14,373,740 Raytheon 331,717(e) 17,391,922 Rockwell Collins 33,368(e) 1,774,844 United Technologies 121,135 8,174,190 --------------- Total 89,345,333 - ------------------------------------------------------------------------------------- AIR FREIGHT & LOGISTICS (0.2%) CH Robinson Worldwide 88,793(e) 5,028,347 FedEx 35,225 2,759,879 --------------- Total 7,788,226 - ------------------------------------------------------------------------------------- AIRLINES (0.1%) Southwest Airlines 197,732 2,240,304 - ------------------------------------------------------------------------------------- AUTO COMPONENTS (0.1%) Goodyear Tire & Rubber 47,349(b) 631,636 Johnson Controls 66,801(e) 1,859,071 --------------- Total 2,490,707 - ------------------------------------------------------------------------------------- AUTOMOBILES (0.7%) Ford Motor 1,768,655(b,e) 19,172,220 Harley-Davidson 312,011(e) 7,095,130 --------------- Total 26,267,350 - ------------------------------------------------------------------------------------- BEVERAGES (2.3%) Brown-Forman Cl B 63,202 3,243,527 Coca-Cola 1,275,454(e) 69,193,379 Coca-Cola Enterprises 293,602 5,927,824 Pepsi Bottling Group 105,725 3,932,970 PepsiCo 170,648(e) 10,174,034 --------------- Total 92,471,734 - ------------------------------------------------------------------------------------- BIOTECHNOLOGY (1.0%) Amgen 616,122(b) 36,030,815 Cephalon 86,619(b,e) 5,529,757 --------------- Total 41,560,572 - ------------------------------------------------------------------------------------- BUILDING PRODUCTS (0.1%) Masco 212,040(e) 2,875,262 - ------------------------------------------------------------------------------------- CAPITAL MARKETS (5.4%) Bank of New York Mellon 956,847 27,834,679 E*TRADE Financial 256,004(b) 389,126 Franklin Resources 196,535(e) 19,462,861 Goldman Sachs Group 708,362(e) 105,347,596 Invesco 344,322 6,645,415 Morgan Stanley 1,363,797(e) 36,522,484 State Street 428,167 18,359,801 T Rowe Price Group 28,175(e) 1,398,044 --------------- Total 215,960,006 - ------------------------------------------------------------------------------------- CHEMICALS (1.5%) Air Products & Chemicals 124,593 9,464,084 CF Inds Holdings 55,426 5,146,858 Dow Chemical 1,124,224(e) 30,455,229 Eastman Chemical 48,953(e) 2,767,313 EI du Pont de Nemours & Co 242,645 7,912,653 PPG Inds 45,235(e) 2,654,390 Sigma-Aldrich 56,009 2,680,031 --------------- Total 61,080,558 - ------------------------------------------------------------------------------------- COMMERCIAL BANKS (2.7%) BB&T 74,077(e) 2,064,526 Comerica 172,895(e) 5,966,606 Fifth Third Bancorp 443,135 5,512,599 First Horizon Natl 516,236(b,e) 6,507,442 Huntington Bancshares 363,386(e) 1,740,619 KeyCorp 480,473 3,449,796 Marshall & Ilsley 374,203(e) 2,585,743 PNC Financial Services Group 743,796(e) 41,228,612 SunTrust Banks 455,939(e) 11,092,996 US Bancorp 280,273(e) 7,029,247 Wells Fargo & Co 667,044 18,964,061 --------------- Total 106,142,247 - -------------------------------------------------------------------------------------
See accompanying Notes to Portfolio of Investments. - -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 9 PORTFOLIO OF INVESTMENTS (continued) -------------------------------------------
COMMON STOCKS (CONTINUED) ISSUER SHARES VALUE(a) COMMERCIAL SERVICES & SUPPLIES (0.2%) Avery Dennison 30,266 $983,948 Pitney Bowes 106,319(e) 2,224,193 RR Donnelley & Sons 167,553(e) 3,320,901 --------------- Total 6,529,042 - ------------------------------------------------------------------------------------- COMMUNICATIONS EQUIPMENT (1.2%) Cisco Systems 782,165(b,e) 17,575,247 Motorola 1,829,461(b,e) 11,251,185 QUALCOMM 417,172 16,348,971 Tellabs 484,597(b) 3,115,959 --------------- Total 48,291,362 - ------------------------------------------------------------------------------------- COMPUTERS & PERIPHERALS (9.7%) Apple 1,192,854(b) 229,171,111 Dell 1,551,459(b,e) 20,013,821 Hewlett-Packard 603,306 28,397,613 IBM 553,669(d,e) 67,763,549 Lexmark Intl Cl A 281,527(b,e) 7,260,581 NetApp 528,967(b) 15,408,809 QLogic 15,253(b,e) 262,199 Western Digital 436,639(b,e) 16,587,916 --------------- Total 384,865,599 - ------------------------------------------------------------------------------------- CONSTRUCTION & ENGINEERING (0.1%) Fluor 131,438 5,959,399 - ------------------------------------------------------------------------------------- CONSUMER FINANCE (0.9%) American Express 637,323 24,001,584 Capital One Financial 7,378 271,953 Discover Financial Services 581,251 7,951,514 SLM 458,905(b,e) 4,832,270 --------------- Total 37,057,321 - ------------------------------------------------------------------------------------- DISTRIBUTORS (0.1%) Genuine Parts 102,631(e) 3,867,136 - ------------------------------------------------------------------------------------- DIVERSIFIED CONSUMER SERVICES (0.1%) Apollo Group Cl A 95,703(b) 5,798,645 - ------------------------------------------------------------------------------------- DIVERSIFIED FINANCIAL SERVICES (4.5%) Bank of America 7,159,098(e) 108,675,109 Citigroup 8,780,214(e) 29,150,310 IntercontinentalExchange 76,534(b,e) 7,307,466 JPMorgan Chase & Co 846,564 32,965,202 KKR Financial Holdings LLC 563,202 3,396,108 --------------- Total 181,494,195 - ------------------------------------------------------------------------------------- DIVERSIFIED TELECOMMUNICATION SERVICES (3.9%) AT&T 3,848,501 97,597,985 CenturyTel 224,673(e) 7,641,129 Verizon Communications 1,722,003(e) 50,661,328 --------------- Total 155,900,442 - ------------------------------------------------------------------------------------- ELECTRIC UTILITIES (1.5%) Edison Intl 188,613 6,284,585 Exelon 487,913(e) 22,258,591 FirstEnergy 209,172(e) 9,124,083 Progress Energy 197,406(e) 7,692,912 Southern 436,647(e) 13,972,704 --------------- Total 59,332,875 - ------------------------------------------------------------------------------------- ELECTRICAL EQUIPMENT (0.2%) Emerson Electric 214,704(e) 8,918,804 - ------------------------------------------------------------------------------------- ELECTRONIC EQUIPMENT, INSTRUMENTS & COMPONENTS (1.0%) Agilent Technologies 365,648(b) 10,249,113 Corning 1,100,659(e) 19,899,915 Jabil Circuit 195,377 2,829,059 Tyco Electronics 313,956(c) 7,811,225 --------------- Total 40,789,312 - ------------------------------------------------------------------------------------- ENERGY EQUIPMENT & SERVICES (2.1%) Baker Hughes 140,755(e) 6,373,386 BJ Services 249,658 5,160,431 Diamond Offshore Drilling 59,023(e) 5,402,375 Ensco Intl ADR 170,924(c,e) 6,671,164 FMC Technologies 128,181(b,e) 6,815,384 Halliburton 182,055 5,317,827 Nabors Inds 181,396(b,c,e) 4,045,131 Natl Oilwell Varco 333,387 13,635,528 Noble 95,253(c,e) 3,840,601 Rowan Companies 84,835(b,e) 1,822,256 Schlumberger 309,383 19,633,444
See accompanying Notes to Portfolio of Investments. - -------------------------------------------------------------------------------- 10 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT - --------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED) ISSUER SHARES VALUE(a) ENERGY EQUIPMENT & SERVICES (CONT.) Smith Intl 64,083(e) $1,942,997 Weatherford Intl 100,838(b,c) 1,581,140 --------------- Total 82,241,664 - ------------------------------------------------------------------------------------- FOOD & STAPLES RETAILING (2.4%) Safeway 201,986 4,534,586 SUPERVALU 112,789(e) 1,659,126 Walgreen 342,190(e) 12,335,950 Wal-Mart Stores 1,290,582 68,955,796 Whole Foods Market 243,910(b) 6,639,230 --------------- Total 94,124,688 - ------------------------------------------------------------------------------------- FOOD PRODUCTS (0.7%) Archer-Daniels-Midland 338,511 10,145,175 ConAgra Foods 170,777(e) 3,883,469 Dean Foods 206,610(b) 3,642,534 Sara Lee 614,887 7,464,728 Tyson Foods Cl A 155,123(e) 2,143,800 --------------- Total 27,279,706 - ------------------------------------------------------------------------------------- GAS UTILITIES (--%) Nicor 32,666(e) 1,323,626 - ------------------------------------------------------------------------------------- HEALTH CARE EQUIPMENT & SUPPLIES (1.2%) Becton Dickinson & Co 149,705(e) 11,283,266 CareFusion 135,016(b) 3,476,662 CR Bard 28,179(e) 2,335,757 Intuitive Surgical 40,465(b,e) 13,274,948 Medtronic 309,668 13,281,660 St. Jude Medical 41,861(b) 1,579,416 Varian Medical Systems 27,347(b,e) 1,375,281 --------------- Total 46,606,990 - ------------------------------------------------------------------------------------- HEALTH CARE PROVIDERS & SERVICES (3.5%) Aetna 390,845 11,713,625 Cardinal Health 410,139 13,563,297 CIGNA 581,895(e) 19,650,594 Coventry Health Care 136,744(b,e) 3,128,703 Humana 69,243(b,e) 3,366,595 McKesson 139,445 8,202,155 Tenet Healthcare 480,003(b) 2,659,217 UnitedHealth Group 1,471,640 48,564,119 WellPoint 452,275(b) 28,818,962 --------------- Total 139,667,267 - ------------------------------------------------------------------------------------- HOTELS, RESTAURANTS & LEISURE (0.4%) Intl Game Technology 10,202(e) 187,105 Starbucks 480,444(b,e) 10,468,875 Starwood Hotels & Resorts Worldwide 23,901(e) 796,381 Wyndham Worldwide 133,379(e) 2,799,625 --------------- Total 14,251,986 - ------------------------------------------------------------------------------------- HOUSEHOLD DURABLES (0.6%) Black & Decker 73,876 4,776,822 DR Horton 417,504(e) 4,922,372 Harman Intl Inds 72,907 2,591,844 KB Home 91,018(e) 1,390,755 Lennar Cl A 225,775(e) 3,467,904 Newell Rubbermaid 40,565(e) 550,467 Pulte Homes 534,471(b,e) 5,622,635 Whirlpool 32,039(e) 2,408,692 --------------- Total 25,731,491 - ------------------------------------------------------------------------------------- HOUSEHOLD PRODUCTS (0.1%) Clorox 75,994(e) 4,496,565 - ------------------------------------------------------------------------------------- INDEPENDENT POWER PRODUCERS & ENERGY TRADERS (0.3%) AES 655,239(b) 8,275,669 Constellation Energy Group 120,319 3,883,897 --------------- Total 12,159,566 - ------------------------------------------------------------------------------------- INDUSTRIAL CONGLOMERATES (2.7%) General Electric 5,974,686(e) 96,072,950 Textron 255,709(e) 4,993,997 Tyco Intl 218,476(c) 7,740,605 --------------- Total 108,807,552 - ------------------------------------------------------------------------------------- INSURANCE (5.5%) ACE 35,444(b,c) 1,746,326 AFLAC 112,988 5,472,009 Allstate 1,327,306 39,726,269 American Intl Group 76,843(b,e) 1,861,906 Aon 169,135(e) 6,579,352 Assurant 166,592 5,235,987 Chubb 269,873(e) 13,493,650 Cincinnati Financial 169,421(e) 4,471,020 Genworth Financial Cl A 369,284(b) 5,110,891 Hartford Financial Services Group 425,943 10,218,373
See accompanying Notes to Portfolio of Investments. - -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 11 PORTFOLIO OF INVESTMENTS (continued) -------------------------------------------
COMMON STOCKS (CONTINUED) ISSUER SHARES VALUE(a) INSURANCE (CONT.) Lincoln Natl 397,673 $9,774,802 MBIA 209,475(b,e) 1,032,712 MetLife 348,325 12,302,839 Principal Financial Group 461,247(e) 10,631,743 Progressive 778,354(e) 12,905,109 Prudential Financial 338,859(e) 16,939,561 Torchmark 151,338(e) 6,795,076 Travelers Companies 981,605 49,737,924 Unum Group 120,100(e) 2,350,357 XL Capital Cl A 210,930(c,e) 3,537,296 --------------- Total 219,923,202 - ------------------------------------------------------------------------------------- INTERNET & CATALOG RETAIL (0.9%) Amazon.com 194,156(b) 24,349,104 priceline.com 69,608(b,e) 13,597,923 --------------- Total 37,947,027 - ------------------------------------------------------------------------------------- INTERNET SOFTWARE & SERVICES (0.5%) eBay 944,584(b,e) 21,744,324 - ------------------------------------------------------------------------------------- IT SERVICES (1.2%) Affiliated Computer Services Cl A 82,030(b) 5,046,486 Automatic Data Processing 262,133(e) 10,692,405 Cognizant Technology Solutions Cl A 463,149(b) 20,221,084 Computer Sciences 154,769(b) 7,939,650 SAIC 236,614(b) 4,337,135 Total System Services 17,806 254,804 --------------- Total 48,491,564 - ------------------------------------------------------------------------------------- LEISURE EQUIPMENT & PRODUCTS (0.1%) Eastman Kodak 497,189(b,e) 3,007,994 Mattel 97,031 1,913,451 --------------- Total 4,921,445 - ------------------------------------------------------------------------------------- LIFE SCIENCES TOOLS & SERVICES (0.3%) Life Technologies 202,576(b,e) 10,070,053 - ------------------------------------------------------------------------------------- MACHINERY (1.0%) Caterpillar 210,057(e) 10,973,377 Eaton 70,537(e) 4,319,686 Flowserve 59,503 5,365,386 Illinois Tool Works 230,932 10,066,326 Ingersoll-Rand 262,591(c) 8,523,704 Manitowoc 187,618(e) 2,045,036 Terex 12,700(b,e) 248,285 --------------- Total 41,541,800 - ------------------------------------------------------------------------------------- MEDIA (1.5%) CBS Cl B 1,048,916(e) 13,562,484 Gannett 254,251(e) 4,106,154 Meredith 60,983(e) 1,889,253 New York Times Cl A 195,273(b) 2,522,927 News Corp Cl A 2,388,496 30,118,934 Viacom Cl B 315,058(b) 9,180,790 WorldSpace Cl A 263,942(b,e) 11,218 --------------- Total 61,391,760 - ------------------------------------------------------------------------------------- METALS & MINING (2.0%) AK Steel Holding 158,307(e) 3,219,964 Alcoa 721,087(e) 9,179,438 Allegheny Technologies 178,218(e) 7,280,205 Freeport-McMoRan Copper & Gold 670,956 44,746,056 Nucor 174,873(e) 7,134,818 Timminco 510,164(b,c,e) 558,312 United States Steel 220,427(e) 9,793,572 --------------- Total 81,912,365 - ------------------------------------------------------------------------------------- MULTILINE RETAIL (0.6%) Family Dollar Stores 133,249(e) 4,114,729 JC Penney 148,632(e) 3,690,533 Macy's 320,682(e) 5,108,464 Nordstrom 185,434(e) 6,404,891 Sears Holdings 29,305(b,e) 2,733,570 --------------- Total 22,052,187 - ------------------------------------------------------------------------------------- MULTI-UTILITIES (0.5%) Ameren 82,274(e) 2,102,101 Consolidated Edison 182,201(e) 7,969,472 PG&E 177,331(e) 7,490,461 SCANA 110,481(e) 3,934,228 --------------- Total 21,496,262 - -------------------------------------------------------------------------------------
See accompanying Notes to Portfolio of Investments. - -------------------------------------------------------------------------------- 12 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT - --------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED) ISSUER SHARES VALUE(a) OFFICE ELECTRONICS (0.1%) Xerox 675,128(e) $5,887,116 - ------------------------------------------------------------------------------------- OIL, GAS & CONSUMABLE FUELS (10.8%) Chevron 2,716,287 195,898,617 ConocoPhillips 1,777,333 85,311,984 Exxon Mobil 790,104(e) 50,906,401 Hess 190,773 11,024,772 Marathon Oil 1,029,805(e) 30,698,487 Murphy Oil 155,175 7,926,339 Occidental Petroleum 287,526 22,524,787 Pioneer Natural Resources 45,404(e) 1,996,868 Sunoco 153,969(e) 3,863,082 Tesoro 257,135(e) 3,214,188 Valero Energy 666,380 12,274,720 --------------- Total 425,640,245 - ------------------------------------------------------------------------------------- PAPER & FOREST PRODUCTS (0.1%) Intl Paper 16,822 385,392 MeadWestvaco 179,553(e) 4,321,841 --------------- Total 4,707,233 - ------------------------------------------------------------------------------------- PHARMACEUTICALS (12.3%) Abbott Laboratories 641,145(e) 33,942,216 Bristol-Myers Squibb 814,244 19,834,984 Eli Lilly & Co 4,366(e) 153,683 Forest Laboratories 424,458(b) 12,580,935 Johnson & Johnson 2,002,974 125,906,946 King Pharmaceuticals 356,719(b,e) 4,284,195 Merck & Co 2,132,929(e) 81,435,229 Mylan 80,029(b,e) 1,458,929 Pfizer 11,071,928 206,602,176 Watson Pharmaceuticals 46,739(b) 1,793,375 --------------- Total 487,992,668 - ------------------------------------------------------------------------------------- REAL ESTATE INVESTMENT TRUSTS (REITS) (0.2%) Boston Properties 36,970 2,398,244 Equity Residential 73,594 2,358,688 Vornado Realty Trust 41,788 2,702,847 --------------- Total 7,459,779 - ------------------------------------------------------------------------------------- ROAD & RAIL (0.4%) CSX 212,244 9,096,778 Norfolk Southern 100,262(e) 4,718,330 Ryder System 79,151(e) 2,881,096 --------------- Total 16,696,204 - ------------------------------------------------------------------------------------- SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT (2.6%) Analog Devices 172,908 4,661,600 Broadcom Cl A 330,280(b,e) 8,825,082 Intel 2,641,704 51,249,057 MEMC Electronic Materials 186,937(b,e) 2,351,667 Microchip Technology 10,930(e) 282,103 Micron Technology 1,326,462(b,e) 11,566,749 Natl Semiconductor 133,622(e) 1,771,828 NVIDIA 495,478(b,e) 7,625,406 Teradyne 33,804(b,e) 315,729 Texas Instruments 748,107 16,832,408 --------------- Total 105,481,629 - ------------------------------------------------------------------------------------- SOFTWARE (1.9%) Intuit 82,955(b,e) 2,456,298 Microsoft 2,130,886 60,048,367 Red Hat 223,506(b,e) 6,083,833 Salesforce.com 102,269(b) 6,499,195 --------------- Total 75,087,693 - ------------------------------------------------------------------------------------- SPECIALTY RETAIL (2.0%) Abercrombie & Fitch Cl A 228,500(e) 7,206,890 AutoNation 73,423(b,e) 1,321,614 AutoZone 10,560(b,e) 1,637,117 Bed Bath & Beyond 63,195(b,e) 2,445,647 Best Buy 131,835(e) 4,831,753 GameStop Cl A 126,390(b,e) 2,498,730 Gap 415,821 7,933,865 Home Depot 1,002,781(d) 28,087,897 Limited Brands 236,424(e) 4,496,784 Lowe's Companies 149,794 3,243,040 Office Depot 303,688(b,e) 1,724,948 RadioShack 135,364(e) 2,642,305 Sherwin-Williams 113,732(e) 7,204,922 Tiffany & Co 66,409(e) 2,696,869 TJX Companies 76,140(e) 2,894,081 --------------- Total 80,866,462 - -------------------------------------------------------------------------------------
See accompanying Notes to Portfolio of Investments. - -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 13 PORTFOLIO OF INVESTMENTS (continued) -------------------------------------------
COMMON STOCKS (CONTINUED) ISSUER SHARES VALUE(a) TEXTILES, APPAREL & LUXURY GOODS (0.6%) Coach 195,031(e) $6,802,681 Jones Apparel Group 78,330 1,131,085 Liz Claiborne 137,649(b,e) 670,351 Nike Cl B 209,579(e) 13,360,662 Polo Ralph Lauren 30,967(e) 2,539,294 VF 14,845(e) 1,069,285 --------------- Total 25,573,358 - ------------------------------------------------------------------------------------- THRIFTS & MORTGAGE FINANCE (0.1%) Fannie Mae 1,336,093(b,e) 1,282,649 Freddie Mac 794,150(b,e) 937,097 --------------- Total 2,219,746 - ------------------------------------------------------------------------------------- TOBACCO (0.1%) Lorillard 46,061 3,486,818 - ------------------------------------------------------------------------------------- TRADING COMPANIES & DISTRIBUTORS (0.1%) Fastenal 52,695(e) 2,185,789 - ------------------------------------------------------------------------------------- WIRELESS TELECOMMUNICATION SERVICES (0.2%) Sprint Nextel 2,458,359(b,e) 8,063,418 - ------------------------------------------------------------------------------------- TOTAL COMMON STOCKS (Cost: $4,153,615,837) $3,966,557,679 - -------------------------------------------------------------------------------------
EQUITY-LINKED NOTES (--%)(g) COUPON PRINCIPAL ISSUER RATE AMOUNT VALUE(a) Lehman Brothers Holdings Sr Unsecured 09-14-08 53.31% $1,275,000(b,h,i,j) $187,122 10-02-08 39.50 1,275,000(b,h,i,j) 207,626 - ------------------------------------------------------------------------------------- TOTAL EQUITY-LINKED NOTES (Cost: $2,550,000) $394,748 - -------------------------------------------------------------------------------------
EXCHANGE TRADED FUNDS (0.2%) SHARES VALUE(a) Vanguard Emerging Markets ETF 195,750 $7,493,310 - ----------------------------------------------------------------------- TOTAL EXCHANGE TRADED FUNDS (Cost: $7,484,764) $7,493,310 - ----------------------------------------------------------------------- MONEY MARKET FUND (--%) SHARES VALUE(a) RiverSource Short-Term Cash Fund, 0.16% 39,819(f) $39,819 - ----------------------------------------------------------------------- TOTAL MONEY MARKET FUND (Cost: $39,819) $39,819 - -----------------------------------------------------------------------
INVESTMENTS OF CASH COLLATERAL RECEIVED FOR SECURITIES ON LOAN (25.1%) AMOUNT EFFECTIVE PAYABLE AT ISSUER YIELD MATURITY VALUE(a) ASSET-BACKED COMMERCIAL PAPER (2.4%) Cancara Asset Securitisation LLC 02-12-10 0.27% $24,983,500 $24,983,500 02-23-10 0.20 9,998,111 9,998,111 Grampian Funding LLC 02-16-10 0.23 12,997,259 12,997,259 Hannover Funding Company LLC 02-03-10 0.45 4,999,563 4,999,563 Rheingold Securitization 03-04-10 0.27 6,617,120 6,617,120 Rhein-Main Securitisation 02-16-10 0.35 9,991,056 9,991,056 03-15-10 0.30 9,718,787 9,718,787 Scaldis Capital LLC 02-04-10 0.20 9,998,389 9,998,389 Versailles Commercial Paper LLC 02-23-10 0.25 7,998,111 7,998,111 --------------- Total 97,301,896 - ------------------------------------------------------------------------------------- CERTIFICATES OF DEPOSIT (18.9%) Australia and New Zealand Bank Group 04-26-10 0.30 5,000,000 5,000,000 04-27-10 0.29 15,000,000 15,000,000 04-30-10 0.30 10,000,000 10,000,000 Banco Bilbao Viz Argentaria, London 03-01-10 0.26 15,007,613 15,007,613 Banco Espirito Santo e Commerciale 02-04-10 0.25 5,000,000 5,000,000 02-05-10 0.24 7,999,634 7,999,634 Banco Popular Caisse d'Epargne 02-16-10 0.28 10,000,000 10,000,000 02-22-10 0.27 4,996,477 4,996,477 04-08-10 0.28 10,000,000 10,000,000
See accompanying Notes to Portfolio of Investments. - -------------------------------------------------------------------------------- 14 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT - --------------------------------------------------------------------------------
INVESTMENTS OF CASH COLLATERAL RECEIVED FOR SECURITIES ON LOAN (CONTINUED) AMOUNT EFFECTIVE PAYABLE AT ISSUER YIELD MATURITY VALUE(a) CERTIFICATES OF DEPOSIT (CONT.) Banco Popular Espanol 02-08-10 0.84% $14,994,227 $14,994,227 03-29-10 0.37 19,987,777 19,987,777 Banco Santander Central Hispano 02-10-10 0.29 7,000,000 7,000,000 04-06-10 0.30 15,000,000 15,000,000 Bank of Austria 02-04-10 0.25 9,997,778 9,997,778 Bank of Tokyo Securities 03-23-10 0.29 20,000,000 20,000,000 Banque Federative du Credit Mutuel 02-16-10 0.34 999,145 999,145 02-18-10 0.33 4,995,787 4,995,787 03-02-10 0.28 4,996,425 4,996,425 04-19-10 0.35 9,991,382 9,991,382 Barclays Bank 02-16-10 0.36 10,000,000 10,000,000 Caisse des Depots 03-01-10 0.28 14,989,507 14,989,507 03-22-10 0.25 4,996,946 4,996,946 Caixa Geral de Deposit 04-08-10 0.35 15,000,000 15,000,000 04-27-10 0.29 7,994,204 7,994,204 Clydesdale Bank 02-08-10 0.30 20,000,000 20,000,000 03-08-10 0.29 14,992,754 14,992,754 Commerzbank 02-04-10 0.23 25,000,000 25,000,000 Credit Industrial et Commercial 04-07-10 0.38 10,000,062 10,000,062 04-13-10 0.34 20,000,000 20,000,000 Dexia Bank 02-11-10 0.40 29,989,671 29,989,671 02-26-10 0.34 9,997,395 9,997,395 DZ Bank 02-26-10 0.23 9,998,211 9,998,211 Hong Kong Shanghai Bank 02-08-10 0.25 25,000,000 25,000,000 Jyske Bank 03-03-10 0.41 19,979,748 19,979,748 03-10-10 0.44 7,991,210 7,991,210 KBC Bank 02-16-10 0.29 14,996,134 14,996,134 02-26-10 0.30 10,000,000 10,000,000 Lloyds Bank London 02-01-10 0.14 545,212 545,212 Natixis 02-08-10 0.28 24,993,857 24,993,857 Nederlandse Waterschapsbank 03-01-10 0.30 24,981,264 24,981,264 Norinchukin Bank 02-17-10 0.31 15,000,000 15,000,000 04-08-10 0.25 20,000,000 20,000,000 04-19-10 0.27 10,000,000 10,000,000 NyKredit Bank 03-22-10 0.44 15,000,000 15,000,000 04-06-10 0.44 9,000,000 9,000,000 Pohjola Bank 03-15-10 0.38 19,981,268 19,981,268 04-26-10 0.31 10,000,000 10,000,000 Raiffeisen Zentralbank Oesterreich 02-03-10 0.25 14,999,272 14,999,272 02-04-10 0.23 35,000,000 35,000,000 Sumitomo Mitsui Banking 02-19-10 0.31 27,000,000 27,000,000 04-19-10 0.29 15,000,000 15,000,000 04-22-10 0.27 10,000,000 10,000,000 Ulster Bank Ireland Limited, Dublin 02-02-10 0.22 15,000,000 15,000,000 Unicredit BK 02-01-10 0.43 13,000,000 13,000,000 04-06-10 0.30 15,000,000 15,000,000 --------------- Total 756,392,960 - ------------------------------------------------------------------------------------- COMMERCIAL PAPER (0.5%) BTM Capital 02-05-10 0.39 19,980,283 19,980,283 - -------------------------------------------------------------------------------------
See accompanying Notes to Portfolio of Investments. - -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 15 PORTFOLIO OF INVESTMENTS (continued) -------------------------------------------
INVESTMENTS OF CASH COLLATERAL RECEIVED FOR SECURITIES ON LOAN (CONTINUED) AMOUNT EFFECTIVE PAYABLE AT ISSUER YIELD MATURITY VALUE(a) REPURCHASE AGREEMENTS (3.3%)(k) Barclays Capital dated 01-29-10, matures 02-01-10, repurchase price $25,000,479 0.23% $25,000,000 $25,000,000 $20,000,467 0.28 20,000,000 20,000,000 Citigroup Global Markets dated 01-29-10, matures 02-01-10 repurchase price $30,000,350 0.14 30,000,000 30,000,000 Natixis Financial Products dated 01-29-10, matures 02-01-10, repurchase price $50,001,375 0.33 50,000,000 50,000,000 RBS Securities dated 01-29-10, matures 02-01-10, repurchase price $5,000,179 0.43 5,000,000 5,000,000 --------------- Total 130,000,000 - ------------------------------------------------------------------------------------- TOTAL INVESTMENTS OF CASH COLLATERAL RECEIVED FOR SECURITIES ON LOAN (Cost: $1,003,675,139) $1,003,675,139 - ------------------------------------------------------------------------------------- TOTAL INVESTMENTS IN SECURITIES (Cost: $5,167,365,559)(l) $4,978,160,695 =====================================================================================
The industries identified above are based on the Global Industry Classification Standard (GICS), which was developed by and is the exclusive property of Morgan Stanley Capital International Inc. and Standard & Poor's, a division of The McGraw-Hill Companies, Inc. INVESTMENTS IN DERIVATIVES FUTURES CONTRACTS OUTSTANDING AT JAN. 31, 2010
NUMBER OF UNREALIZED CONTRACTS NOTIONAL EXPIRATION APPRECIATION CONTRACT DESCRIPTION LONG (SHORT) MARKET VALUE DATE (DEPRECIATION) - ----------------------------------------------------------------------------------- S&P 500 Index 88 $23,548,800 March 2010 $(583,651)
NOTES TO PORTFOLIO OF INVESTMENTS ADR -- American Depository Receipt
(a) Securities are valued by using policies described in Note 2 to the financial statements. (b) Non-income producing. For long-term debt securities, item identified is in default as to payment of interest and/or principal. (c) Foreign security values are stated in U.S. dollars. At Jan. 31, 2010, the value of foreign securities represented 1.15% of net assets. (d) At Jan. 31, 2010, investments in securities included securities valued at $11,071,436 that were partially pledged as collateral to cover initial margin deposits on open stock index futures contracts. - -------------------------------------------------------------------------------- 16 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT - -------------------------------------------------------------------------------- NOTES TO PORTFOLIO OF INVESTMENTS (CONTINUED) (e) At Jan. 31, 2010, security was partially or fully on loan. See Note 7 to the financial statements. (f) Affiliated Money Market Fund -- See Note 8 to the financial statements. The rate shown is the seven-day current annualized yield at Jan. 31, 2010. (g) Equity-Linked Notes (ELNs) are notes created by a counterparty, typically an investment bank, that may bear interest at a fixed or floating rate. At maturity, the notes must be exchanged for an amount based on the value of one or more equity securities of third party issuers or the value of an index. The exchanged value may be limited to an amount less than the actual value of the underlying stocks or value of an index at the maturity date. Any difference between the exchange amount and the original cost of the notes will be a gain or loss. (h) Represents a security sold under Rule 144A, which is exempt from registration under the Securities Act of 1933, as amended. This security may be determined to be liquid under guidelines established by the Fund's Board of Directors. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. At Jan. 31, 2010, the value of these securities amounted to $394,748 or 0.01% of net assets. (i) Identifies issues considered to be illiquid as to their marketability. The aggregate value of such securities at Jan. 31, 2010 was $394,748, representing 0.01% of net assets. Information concerning such security holdings at Jan. 31, 2010 is as follows:
ACQUISITION SECURITY DATES COST ---------------------------------------------------------------- Lehman Brothers Holdings Sr Unsecured 53.31% 2008 03-07-08 $1,275,000 39.50% 2008 03-26-08 1,275,000
(j) This position is in bankruptcy. (k) The table below represents securities received as collateral subject to repurchase agreements. This collateral, which is generally high quality short-term obligations, is deposited with the Fund's custodian and, pursuant to the terms of the repurchase agreement, must have an aggregate market value greater than or equal to the repurchase price plus accrued interest at all times. On a daily basis, the market value of securities held as collateral for repurchase agreements is monitored to ensure the existence of the proper level of collateral.
BARCLAYS CAPITAL (0.23%) SECURITY DESCRIPTION VALUE(a) - ------------------------------------------------------------ Fannie Mae Pool $13,477,717 Freddie Mac Gold Pool 8,350,609 Freddie Mac Non Gold Pool 3,671,674 - ------------------------------------------------------------ Total market value of collateral securities $25,500,000 - ------------------------------------------------------------
- -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 17 PORTFOLIO OF INVESTMENTS (continued) ------------------------------------------- NOTES TO PORTFOLIO OF INVESTMENTS (CONTINUED)
BARCLAYS CAPITAL (0.28%) SECURITY DESCRIPTION VALUE(a) - ------------------------------------------------------------ American Tower Trust $138,788 Banc of America Commercial Mortgage Inc 85,806 BCAP LLC Trust 26,382 Bear Stearns Commercial Mortgage Securities 168,533 CC Mortgage Funding Corp 185,223 Citigroup Mortgage Loan Trust Inc 33,231 Citigroup/Deutsche Bank Commercial Mortgage Trust 37,673 Commercial Mortgage Pass Through Certificates 37,353 Countrywide Home Loan Mortgage Pass Through Trust 175,389 Credit Suisse First Boston Mortgage Securities Corp 117,743 Credit Suisse Mortgage Capital Certificates 2,150 Crusade Global Trust 124,980 CW Capital Cobalt Ltd 20,642 Fannie Mae Pool 10,418,170 Freddie Mac Gold Pool 5,780,170 Freddie Mac Non Gold Pool 1,461,503 Gracechurch Mortgage Financing PLC 23,983 Granite Master Issuer PLC 114,511 Granite Mortgages PLC 87,939 Interstar Millennium Trust 55,597 Kildare Securities Ltd 8,737 LB-UBS Commercial Mortgage Trust 447,651 Leek Finance Ltd 18,256 Medallion Trust 4,364 Merrill Lynch Floating Trust 191,127 Morgan Stanley Capital I 199,382 Morgan Stanley Dean Witter Capital I 5,222 Paragon Mortgages PLC 4,066 Puma Finance Ltd 58,079 Residential Accredit Loans Inc 99,201 Residential Asset Mortgage Products Inc 28,493 SACO I Inc 44,637 Structured Asset Mortgage Investments Inc 102,561 Structured Asset Securities Corp 23,822 Superannuation Members Home Loans Global Fund 19,681 Thornburg Mortgage Securities Trust 3,911 TIAA Seasoned Commercial Mortgage Trust 16,176 WaMu Mortgage Pass Through Certificates 109,461 - ------------------------------------------------------------ Total market value of collateral securities $20,480,593 - ------------------------------------------------------------
- -------------------------------------------------------------------------------- 18 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT - -------------------------------------------------------------------------------- NOTES TO PORTFOLIO OF INVESTMENTS (CONTINUED)
CITIGROUP GLOBAL MARKETS (0.14%) SECURITY DESCRIPTION VALUE(a) - ------------------------------------------------------------ Fannie Mae REMICS $13,453,602 Freddie Mac REMICS 14,788,590 Government National Mortgage Association 2,357,808 - ------------------------------------------------------------ Total market value of collateral securities $30,600,000 - ------------------------------------------------------------ NATIXIS FINANCIAL PRODUCTS (0.33%) SECURITY DESCRIPTION VALUE(a) - ------------------------------------------------------------ A4 Funding LP $18,442,473 Fannie Mae Interest Strip 1,098,407 Fannie Mae Pool 3,842,300 Fannie Mae REMICS 8,102,733 Federal Home Loan Mortgage Corp 20,190 FHLMC-GNMA 78,321 Freddie Mac Gold Pool 559,072 Freddie Mac Non Gold Pool 1,064,157 Freddie Mac REMICS 9,177,577 Freddie Mac Strips 1,088,030 Ginnie Mae II Pool 1,284,626 Govt Natl Mtge Assn 2,404,725 United States Treasury Note/Bond 4,365,730 - ------------------------------------------------------------ Total market value of collateral securities $51,528,341 - ------------------------------------------------------------ RBS SECURITIES (0.43%) SECURITY DESCRIPTION VALUE(a) - ------------------------------------------------------------ Access Group Inc $92,053 Accredited Mortgage Loan Trust 29,216 AIG Credit Premium Finance Master Trust 51,395 Americredit Prime Automobile Receivable 1,105 Banc of America Commercial Mortgage Inc 22,986 Banc of America Mortgage Securities Inc 22,382 Bear Stearns Adjustable Rate Mortgage Trust 184,043 Bella Vista Mortgage Trust 3,566 Capital Auto Receivables Asset Trust 1,264,629 Citigroup Commercial Mortgage Trust 365,996 Commercial Mortgage Pass Through Certificates 15,684 Countrywide Asset-Backed Certificates 101,584 Countrywide Home Loan Mortgage Pass Through Trust 17,683 Credit Suisse First Boston Mortgage Securities Corp 30,840 Credit Suisse Mortgage Capital Certificates 343,526 Credit-Based Asset Servicing and Securitization LLC 60,946
- -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 19 PORTFOLIO OF INVESTMENTS (continued) ------------------------------------------- NOTES TO PORTFOLIO OF INVESTMENTS (CONTINUED)
RBS SECURITIES (CONT.) SECURITY DESCRIPTION VALUE(a) - ------------------------------------------------------------ First Horizon Alternative Mortgage Securities $3,049 First NLC Trust 26,400 Ford Credit Auto Owner Trust 10,023 Franklin Auto Trust 15,482 GE Business Loan Trust 234,689 Greenwich Capital Commercial Funding Corp 239,011 GS Mortgage Securities Corp II 465,719 Hampden CBO Ltd 188,724 Honda Auto Receivables Owner Trust 17,479 JP Morgan Chase Commercial Mortgage Securities Corp 17,256 JP Morgan Mortgage Trust 4,461 Keycorp Student Loan Trust 15,379 LB-UBS Commercial Mortgage Trust 10,080 Mellon Residential Funding Corp 7,691 MLCC Mortgage Investors Inc 298 Morgan Stanley Capital I 14,504 MortgageIT Trust 5,439 Nissan Auto Lease Trust 81,887 Petra CRE CDO Ltd 38,335 Residential Asset Mortgage Products Inc 39,734 Sequoia Mortgage Trust 340 SLM Student Loan Trust 183,916 Soundview Home Equity Loan Trust 11,000 Structured Adjustable Rate Mortgage Loan Trust 15,450 Structured Asset Securities Corp 251,866 Thornburg Mortgage Securities Trust 1,965 Volkswagen Auto Loan Enhanced Trust 76,199 Wachovia Auto Owner Trust 77,432 Wachovia Bank Commercial Mortgage Trust 388,623 WaMu Mortgage Pass Through Certificates 199,935 - ------------------------------------------------------------ Total market value of collateral securities $5,250,000 - ------------------------------------------------------------
(l) At Jan. 31, 2010, the cost of securities for federal income tax purposes was approximately $5,167,367,000 and the approximate aggregate gross unrealized appreciation and depreciation based on that cost was: Unrealized appreciation $363,206,000 Unrealized depreciation (552,412,000) ------------------------------------------------------------ Net unrealized depreciation $(189,206,000) ------------------------------------------------------------
- -------------------------------------------------------------------------------- 20 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT - -------------------------------------------------------------------------------- FAIR VALUE MEASUREMENTS Generally accepted accounting principles (GAAP) require disclosure regarding the inputs and valuation techniques used to measure fair value and any changes in valuation inputs or techniques. In addition, investments shall be disclosed by major category. The Fund categorizes its fair value measurements according to a three-level hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs by prioritizing that the most observable input be used when available. Observable inputs are those that market participants would use in pricing an investment based on market data obtained from sources independent of the reporting entity. Unobservable inputs are those that reflect the Fund's assumptions about the information market participants would use in pricing an investment. An investment's level within the fair value hierarchy is based on the lowest level of any input that is deemed significant to the asset or liability's fair value measurement. The input levels are not necessarily an indication of the risk or liquidity associated with investments at that level. For example, certain U.S. government securities are generally high quality and liquid, however, they are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market. Fair value inputs are summarized in the three broad levels listed below: - Level 1 -- Valuations based on quoted prices for investments in active markets that the Fund has the ability to access at the measurement date. Valuation adjustments are not applied to Level 1 investments. - Level 2 -- Valuations based on other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risks, etc.). - Level 3 -- Valuations based on significant unobservable inputs (including the Fund's own assumptions and judgment in determining the fair value of investments). Inputs that are used in determining fair value of an investment may include price information, credit data, volatility statistics, and other factors. These inputs can be either observable or unobservable. The availability of observable inputs can vary between investments, and is affected by various factors such as the type of investment, and the volume and level of activity for that investment or similar investments in the marketplace. The inputs will be considered by the Fund Administrator, along with any other relevant factors in the calculation of an investment's fair value. The Fund uses prices and inputs that are current as of the measurement date, which may include periods of market dislocations. During these periods, the availability of prices and inputs may be reduced for many investments. This condition could cause an investment to be reclassified between the various levels within the hierarchy. Investments falling into the Level 3 category are primarily supported by quoted prices from brokers and dealers participating in the market for those investments. However, these may be classified as Level 3 investments due to lack of market transparency and corroboration to support these quoted prices. Additionally, valuation models may be used as the pricing source for any remaining investments classified as Level 3. These models rely on one or more significant unobservable inputs and/or significant assumptions by the Fund Administrator. Inputs used in a valuation model - -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 21 PORTFOLIO OF INVESTMENTS (continued) ------------------------------------------- FAIR VALUE MEASUREMENTS (CONTINUED) may include, but are not limited to, financial statement analysis, discount rates and estimated cash flows, and comparable company data. The following table is a summary of the inputs used to value the Fund's investments as of Jan. 31, 2010:
FAIR VALUE AT JAN. 31, 2010 -------------------------------------------------------------------- LEVEL 1 LEVEL 2 QUOTED PRICES OTHER LEVEL 3 IN ACTIVE SIGNIFICANT SIGNIFICANT MARKETS FOR OBSERVABLE UNOBSERVABLE DESCRIPTION IDENTICAL ASSETS INPUTS INPUTS TOTAL - ----------------------------------------------------------------------------------------------- Equity Securities Common Stocks(a) $3,966,557,679 $-- $-- $3,966,557,679 - ----------------------------------------------------------------------------------------------- Total Equity Securities 3,966,557,679 -- -- 3,966,557,679 - ----------------------------------------------------------------------------------------------- Other Equity-Linked Notes -- 394,748 -- 394,748 Exchange Traded Funds 7,493,310 -- -- 7,493,310 Affiliated Money Market Fund(b) 39,819 -- -- 39,819 Investments of Cash Collateral Received for Securities on Loan(c) -- 1,003,675,139 -- 1,003,675,139 - ----------------------------------------------------------------------------------------------- Total Other 7,533,129 1,004,069,887 -- 1,011,603,016 - ----------------------------------------------------------------------------------------------- Investments in Securities 3,974,090,808 1,004,069,887 -- 4,978,160,695 Other Financial Instruments(d) (583,651) -- -- (583,651) - ----------------------------------------------------------------------------------------------- Total $3,973,507,157 $1,004,069,887 $-- $4,977,577,044 - -----------------------------------------------------------------------------------------------
(a) Industry classifications are identified in the Portfolio of Investments. (b) Money market fund that is a sweep investment for cash balances in the Fund at Jan. 31, 2010. (c) Asset categories for Investments of Cash Collateral are identified in the Portfolio of Investments. (d) Other Financial Instruments are derivative instruments, which are valued at the unrealized appreciation (depreciation) on the instrument. Derivative descriptions are located in the Investments in Derivatives section of the Portfolio of Investments. HOW TO FIND INFORMATION ABOUT THE FUND'S QUARTERLY PORTFOLIO HOLDINGS (i) The Fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (Commission) for the first and third quarters of each fiscal year on Form N-Q; (ii) The Fund's Forms N-Q are available on the Commission's website at http://www.sec.gov; (iii)The Fund's Forms N-Q may be reviewed and copied at the Commission's Public Reference Room in Washington, DC (information on the operations of the Public Reference Room may be obtained by calling 1(800) SEC-0330); and (iv) The Fund's complete schedule of portfolio holdings, as filed on Form N-Q, can be obtained without charge, upon request, by calling the RiverSource Family of Funds at 1(800) 221-2450. - -------------------------------------------------------------------------------- 22 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT STATEMENT OF ASSETS AND LIABILITIES -------------------------------------------- JAN. 31, 2010 (UNAUDITED)
ASSETS Investments in securities, at value Unaffiliated issuers* (identified cost $4,163,650,601) $ 3,974,445,737 Affiliated money market fund (identified cost $39,819) 39,819 Investments of cash collateral received for securities on loan (identified cost $1,003,675,139) 1,003,675,139 - ---------------------------------------------------------------------------------- Total investments in securities (identified cost $5,167,365,559) 4,978,160,695 Capital shares receivable 2,034,182 Dividends and accrued interest receivable 4,540,645 Receivable for investment securities sold 52,804,981 Other assets 22,506 - ---------------------------------------------------------------------------------- Total assets 5,037,563,009 - ---------------------------------------------------------------------------------- LIABILITIES Capital shares payable 25,143,077 Payable for investment securities purchased 11,489,217 Payable upon return of securities loaned 1,003,675,139 Variation margin payable on futures contracts 193,600 Accrued investment management services fees 62,324 Accrued distribution fees 29,071 Accrued transfer agency fees 27,684 Accrued administrative services fees 5,463 Accrued plan administration services fees 1,115 Other accrued expenses 503,209 - ---------------------------------------------------------------------------------- Total liabilities 1,041,129,899 - ---------------------------------------------------------------------------------- Net assets applicable to outstanding capital stock $ 3,996,433,110 - ---------------------------------------------------------------------------------- REPRESENTED BY Capital stock -- $.01 par value $ 8,781,113 Additional paid-in capital 6,920,849,638 Excess of distributions over net investment income (24,697,440) Accumulated net realized gain (loss) (2,718,749,562) Unrealized appreciation (depreciation) on investments and on translation of assets and liabilities in foreign currencies (189,750,639) - ---------------------------------------------------------------------------------- Total -- representing net assets applicable to outstanding capital stock $ 3,996,433,110 - ---------------------------------------------------------------------------------- *Value of securities on loan $ 965,533,920 - ----------------------------------------------------------------------------------
- -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 23 STATEMENT OF ASSETS AND LIABILITIES (continued) -------------------------------- JAN. 31, 2010 (UNAUDITED)
NET ASSET VALUE PER SHARE NET ASSETS SHARES OUTSTANDING NET ASSET VALUE PER SHARE Class A $2,751,318,692 604,616,314 $4.55 Class B $ 212,888,663 46,888,422 $4.54 Class C $ 22,935,114 5,102,505 $4.49 Class I $ 332,762,083 72,785,003 $4.57 Class R2 $ 2,034,698 446,709 $4.55 Class R3 $ 5,796 1,273 $4.55 Class R4 $ 158,960,129 34,813,965 $4.57 Class R5 $ 23,601,940 5,183,381 $4.55 Class W $ 491,925,995 108,273,724 $4.54 - -------------------------------------------------------------------------------------------
(1) The maximum offering price per share for Class A is $4.83. The offering price is calculated by dividing the net asset value by 1.0 minus the maximum sales charge of 5.75%. The accompanying Notes to Financial Statements are an integral part of this statement. - -------------------------------------------------------------------------------- 24 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT STATEMENT OF OPERATIONS -------------------------------------------------------- SIX MONTHS ENDED JAN. 31, 2010 (UNAUDITED)
INVESTMENT INCOME Income: Dividends $ 36,383,817 Income distributions from affiliated money market fund 20,442 Income from securities lending -- net 1,092,965 - ------------------------------------------------------------------------------- Total income 37,497,224 - ------------------------------------------------------------------------------- Expenses: Investment management services fees 9,337,500 Distribution fees Class A 2,985,078 Class B 876,491 Class C 93,209 Class R2 3,753 Class R3 6 Class W 808,979 Transfer agency fees Class A 3,367,791 Class B 273,854 Class C 28,246 Class R2 375 Class R3 1 Class R4 37,291 Class R5 4,742 Class W 647,183 Administrative services fees 924,997 Plan administration services fees Class R2 1,877 Class R3 6 Class R4 186,457 Compensation of board members 61,243 Custodian fees 5,035 Printing and postage 195,291 Registration fees 37,382 Professional fees 23,668 Other 91,077 - ------------------------------------------------------------------------------- Total expenses 19,991,532 Expenses waived/reimbursed by the Investment Manager and its affiliates (2,264,817) - ------------------------------------------------------------------------------- Total net expenses 17,726,715 - ------------------------------------------------------------------------------- Investment income (loss) -- net 19,770,509 - -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 25 STATEMENT OF OPERATIONS (continued) -------------------------------------------- SIX MONTHS ENDED JAN. 31, 2010 (UNAUDITED)
REALIZED AND UNREALIZED GAIN (LOSS) -- NET Net realized gain (loss) on: Security transactions $ 29,883,996 Foreign currency transactions (10,805) Futures contracts 5,572,060 - ------------------------------------------------------------------------------- Net realized gain (loss) on investments 35,445,251 Net change in unrealized appreciation (depreciation) on investments and on translation of assets and liabilities in foreign currencies 202,326,284 - ------------------------------------------------------------------------------- Net gain (loss) on investments and foreign currencies 237,771,535 - ------------------------------------------------------------------------------- Net increase (decrease) in net assets resulting from operations $257,542,044 - -------------------------------------------------------------------------------
The accompanying Notes to Financial Statements are an integral part of this statement. - -------------------------------------------------------------------------------- 26 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT STATEMENTS OF CHANGES IN NET ASSETS --------------------------------------------
SIX MONTHS ENDED JAN. 31, 2010 YEAR ENDED (UNAUDITED) JULY 31, 2009 OPERATIONS AND DISTRIBUTIONS Investment income (loss) -- net $ 19,770,509 $ 43,892,499 Net realized gain (loss) on investments 35,445,251 (711,417,634) Net change in unrealized appreciation (depreciation) on investments and on translation of assets and liabilities in foreign currencies 202,326,284 (44,531,092) - ---------------------------------------------------------------------------------------------------- Net increase (decrease) in net assets resulting from operations 257,542,044 (712,056,227) - ---------------------------------------------------------------------------------------------------- Distributions to shareholders from: Net investment income Class A (46,396,147) (9,214,426) Class B (2,071,798) -- Class C (237,648) (7,117) Class I (13,083,100) (5,438,440) Class R2 (17,934) (33) Class R3 (128) (42) Class R4 (3,996,938) (1,326,570) Class R5 (279,981) (49) Class W (21,497,369) (10,297,303) Net realized gain Class A -- (24,419,810) Class B -- (803,415) Class C -- (70,547) Class I -- (10,144,769) Class R2 -- (97) Class R3 -- (96) Class R4 -- (2,985,348) Class R5 -- (96) Class W -- (30,699,663) - ---------------------------------------------------------------------------------------------------- Total distributions (87,581,043) (95,407,821) - ---------------------------------------------------------------------------------------------------- CAPITAL SHARE TRANSACTIONS Proceeds from sales Class A shares 23,716,878 28,702,122 Class B shares 4,921,823 2,141,651 Class C shares 1,494,638 553,812 Class I shares 19,628,090 101,166,985 Class R2 shares 518,740 -- Class R4 shares 7,869,370 11,162,166 Class R5 shares 905,790 -- Class W shares 37,705,666 333,646,211
- -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 27 STATEMENTS OF CHANGES IN NET ASSETS (continued) --------------------------------
SIX MONTHS ENDED JAN. 31, 2010 YEAR ENDED (UNAUDITED) JULY 31, 2009 Fund merger (Note 10) Class A shares $2,145,265,006 N/A Class B shares 204,721,762 N/A Class C shares 20,969,821 N/A Class I shares 37,568,585 N/A Class R2 shares 1,877,697 N/A Class R3 shares 2,732 N/A Class R4 shares 71,155,805 N/A Class R5 shares 24,248,507 N/A Reinvestment of distributions at net asset value Class A shares 43,354,074 $ 31,091,644 Class B shares 2,051,684 793,672 Class C shares 213,335 73,505 Class I shares 13,082,819 15,582,928 Class R2 shares 3,125 -- Class R4 shares 3,996,912 4,311,918 Class R5 shares 279,835 -- Class W shares 21,497,270 40,996,838 Conversions from Class B to Class A Class A shares 119,967 4,943,185 Class B shares (119,967) (4,943,185) Payments for redemptions Class A shares (242,701,284) (154,038,553) Class B shares (19,753,283) (8,152,830) Class C shares (2,403,596) (569,142) Class I shares (88,855,746) (70,748,251) Class R2 shares (390,847) -- Class R4 shares (20,554,763) (18,348,722) Class R5 shares (2,389,355) -- Class W shares (340,530,043) (632,276,771) - ---------------------------------------------------------------------------------------------------- Increase (decrease) in net assets from capital share transactions 1,969,471,047 (313,910,817) - ---------------------------------------------------------------------------------------------------- Total increase (decrease) in net assets 2,139,432,048 (1,121,374,865) Net assets at beginning of period 1,857,001,062 2,978,375,927 - ---------------------------------------------------------------------------------------------------- Net assets at end of period $3,996,433,110 $ 1,857,001,062 - ---------------------------------------------------------------------------------------------------- Undistributed (excess of distributions over) net investment income $ (24,697,440) $ 43,755,766 - ----------------------------------------------------------------------------------------------------
The accompanying Notes to Financial Statements are an integral part of this statement. - -------------------------------------------------------------------------------- 28 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT FINANCIAL HIGHLIGHTS ----------------------------------------------------------- The following tables are intended to help you understand the Fund's financial performance. Certain information reflects financial results for a single share of a class held for the periods shown. For periods ended 2007 and after, per share net investment income (loss) amounts are calculated based on average shares outstanding during the period. Total returns assume reinvestment of all dividends and distributions. Total returns do not reflect payment of sales charges, if any, and are not annualized for periods of less than one year.
SIX MONTHS ENDED YEAR ENDED JULY 31, CLASS A JAN. 31, 2010 -------------------------------------------------------- PER SHARE DATA (UNAUDITED) 2009 2008 2007 2006 2005 Net asset value, beginning of period $4.30 $5.88 $7.22 $6.74 $6.70 $5.95 - --------------------------------------------------------------------------------------------------------------------------------- INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) .02 .09 .09 .08 .06 .04 Net gains (losses) (both realized and unrealized) .38 (1.47) (1.00) .97 .35 .90 - --------------------------------------------------------------------------------------------------------------------------------- Total from investment operations .40 (1.38) (.91) 1.05 .41 .94 - --------------------------------------------------------------------------------------------------------------------------------- LESS DISTRIBUTIONS: Dividends from net investment income (.15) (.05) (.06) (.06) (.06) (.03) Distributions from realized gains -- (.15) (.37) (.51) (.31) (.16) - --------------------------------------------------------------------------------------------------------------------------------- Total distributions (.15) (.20) (.43) (.57) (.37) (.19) - --------------------------------------------------------------------------------------------------------------------------------- Net asset value, end of period $4.55 $4.30 $5.88 $7.22 $6.74 $6.70 - --------------------------------------------------------------------------------------------------------------------------------- TOTAL RETURN 9.46% (23.19%) (13.40%) 15.92% 6.25% 15.95% - --------------------------------------------------------------------------------------------------------------------------------- RATIOS TO AVERAGE NET ASSETS(a) Gross expenses prior to expense waiver/reimbursement 1.11%(b) .96% .96% 1.05% 1.05% 1.35% - --------------------------------------------------------------------------------------------------------------------------------- Net expenses after expense waiver/reimbursement(c) .96%(b) .95% .96% 1.03% 1.02% 1.25% - --------------------------------------------------------------------------------------------------------------------------------- Net investment income (loss) .96%(b) 2.11% 1.35% 1.13% .95% .84% - --------------------------------------------------------------------------------------------------------------------------------- SUPPLEMENTAL DATA Net assets, end of period (in millions) $2,751 $692 $1,067 $1,410 $1,368 $28 - --------------------------------------------------------------------------------------------------------------------------------- Portfolio turnover rate 30% 61% 58% 62% 137% 64% - ---------------------------------------------------------------------------------------------------------------------------------
See accompanying Notes to Financial Highlights. - -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 29 FINANCIAL HIGHLIGHTS (continued) -----------------------------------------------
SIX MONTHS ENDED YEAR ENDED JULY 31, CLASS B JAN. 31, 2010 ------------------------------------------------------- PER SHARE DATA (UNAUDITED) 2009 2008 2007 2006 2005 Net asset value, beginning of period $4.27 $5.80 $7.12 $6.65 $6.62 $5.90 - -------------------------------------------------------------------------------------------------------------------------------- INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) .00(d) .06 .04 .03 .01 .02 Net gains (losses) (both realized and unrealized) .38 (1.44) (.99) .96 .34 .86 - -------------------------------------------------------------------------------------------------------------------------------- Total from investment operations .38 (1.38) (.95) .99 .35 .88 - -------------------------------------------------------------------------------------------------------------------------------- LESS DISTRIBUTIONS: Dividends from net investment income (.11) -- -- (.01) (.01) -- Distributions from realized gains -- (.15) (.37) (.51) (.31) (.16) - -------------------------------------------------------------------------------------------------------------------------------- Total distributions (.11) (.15) (.37) (.52) (.32) (.16) - -------------------------------------------------------------------------------------------------------------------------------- Net asset value, end of period $4.54 $4.27 $5.80 $7.12 $6.65 $6.62 - -------------------------------------------------------------------------------------------------------------------------------- TOTAL RETURN 8.95% (23.68%) (14.07%) 15.18% 5.42% 15.03% - -------------------------------------------------------------------------------------------------------------------------------- RATIOS TO AVERAGE NET ASSETS(a) Gross expenses prior to expense waiver/reimbursement 1.89%(b) 1.73% 1.72% 1.82% 1.85% 2.13% - -------------------------------------------------------------------------------------------------------------------------------- Net expenses after expense waiver/reimbursement(c) 1.74%(b) 1.71% 1.72% 1.79% 1.82% 2.04% - -------------------------------------------------------------------------------------------------------------------------------- Net investment income (loss) .09%(b) 1.35% .59% .37% .20% .06% - -------------------------------------------------------------------------------------------------------------------------------- SUPPLEMENTAL DATA Net assets, end of period (in millions) $213 $16 $35 $62 $73 $9 - -------------------------------------------------------------------------------------------------------------------------------- Portfolio turnover rate 30% 61% 58% 62% 137% 64% - --------------------------------------------------------------------------------------------------------------------------------
See accompanying Notes to Financial Highlights. - -------------------------------------------------------------------------------- 30 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT - --------------------------------------------------------------------------------
SIX MONTHS ENDED YEAR ENDED JULY 31, CLASS C JAN. 31, 2010 ------------------------------------------------------- PER SHARE DATA (UNAUDITED) 2009 2008 2007 2006 2005 Net asset value, beginning of period $4.24 $5.78 $7.11 $6.65 $6.62 $5.90 - -------------------------------------------------------------------------------------------------------------------------------- INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) .00(d) .06 .04 .03 .01 .01 Net gains (losses) (both realized and unrealized) .37 (1.44) (.99) .96 .35 .87 - -------------------------------------------------------------------------------------------------------------------------------- Total from investment operations .37 (1.38) (.95) .99 .36 .88 - -------------------------------------------------------------------------------------------------------------------------------- LESS DISTRIBUTIONS: Dividends from net investment income (.12) (.01) (.01) (.02) (.02) -- Distributions from realized gains -- (.15) (.37) (.51) (.31) (.16) - -------------------------------------------------------------------------------------------------------------------------------- Total distributions (.12) (.16) (.38) (.53) (.33) (.16) - -------------------------------------------------------------------------------------------------------------------------------- Net asset value, end of period $4.49 $4.24 $5.78 $7.11 $6.65 $6.62 - -------------------------------------------------------------------------------------------------------------------------------- TOTAL RETURN 8.85% (23.66%) (14.11%) 15.14% 5.51% 15.03% - -------------------------------------------------------------------------------------------------------------------------------- RATIOS TO AVERAGE NET ASSETS(a) Gross expenses prior to expense waiver/reimbursement 1.88%(b) 1.72% 1.72% 1.81% 1.84% 2.13% - -------------------------------------------------------------------------------------------------------------------------------- Net expenses after expense waiver/reimbursement(c) 1.72%(b) 1.71% 1.72% 1.79% 1.81% 2.06% - -------------------------------------------------------------------------------------------------------------------------------- Net investment income (loss) .13%(b) 1.35% .59% .36% .20% .02% - -------------------------------------------------------------------------------------------------------------------------------- SUPPLEMENTAL DATA Net assets, end of period (in millions) $23 $2 $3 $3 $3 $-- - -------------------------------------------------------------------------------------------------------------------------------- Portfolio turnover rate 30% 61% 58% 62% 137% 64% - --------------------------------------------------------------------------------------------------------------------------------
See accompanying Notes to Financial Highlights. - -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 31 FINANCIAL HIGHLIGHTS (continued) -----------------------------------------------
SIX MONTHS ENDED YEAR ENDED JULY 31, CLASS I JAN. 31, 2010 ------------------------------------------------------- PER SHARE DATA (UNAUDITED) 2009 2008 2007 2006 2005 Net asset value, beginning of period $4.33 $5.93 $7.27 $6.78 $6.73 $5.96 - -------------------------------------------------------------------------------------------------------------------------------- INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) .04 .11 .11 .11 .08 .04 Net gains (losses) (both realized and unrealized) .37 (1.49) (.99) .97 .36 .92 - -------------------------------------------------------------------------------------------------------------------------------- Total from investment operations .41 (1.38) (.88) 1.08 .44 .96 - -------------------------------------------------------------------------------------------------------------------------------- LESS DISTRIBUTIONS: Dividends from net investment income (.17) (.07) (.09) (.08) (.08) (.03) Distributions from realized gains -- (.15) (.37) (.51) (.31) (.16) - -------------------------------------------------------------------------------------------------------------------------------- Total distributions (.17) (.22) (.46) (.59) (.39) (.19) - -------------------------------------------------------------------------------------------------------------------------------- Net asset value, end of period $4.57 $4.33 $5.93 $7.27 $6.78 $6.73 - -------------------------------------------------------------------------------------------------------------------------------- TOTAL RETURN 9.58% (22.90%) (12.98%) 16.29% 6.73% 16.29% - -------------------------------------------------------------------------------------------------------------------------------- RATIOS TO AVERAGE NET ASSETS(a) Gross expenses prior to expense waiver/reimbursement .56%(b) .56% .61% .70% .72% .91% - -------------------------------------------------------------------------------------------------------------------------------- Net expenses after expense waiver/reimbursement(c) .49%(b) .56% .61% .67% .70% .91% - -------------------------------------------------------------------------------------------------------------------------------- Net investment income (loss) 1.66%(b) 2.51% 1.69% 1.47% 1.41% 1.19% - -------------------------------------------------------------------------------------------------------------------------------- SUPPLEMENTAL DATA Net assets, end of period (in millions) $333 $332 $391 $441 $252 $82 - -------------------------------------------------------------------------------------------------------------------------------- Portfolio turnover rate 30% 61% 58% 62% 137% 64% - --------------------------------------------------------------------------------------------------------------------------------
See accompanying Notes to Financial Highlights. - -------------------------------------------------------------------------------- 32 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT - --------------------------------------------------------------------------------
SIX MONTHS ENDED YEAR ENDED JULY 31, CLASS R2 JAN. 31, 2010 --------------------------------- PER SHARE DATA (UNAUDITED) 2009 2008 2007(e) Net asset value, beginning of period $4.30 $5.88 $7.21 $7.57 - ---------------------------------------------------------------------------------------------------------- INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) .01 .08 .08 .03 Net gains (losses) (both realized and unrealized) .38 (1.47) (1.00) .20 - ---------------------------------------------------------------------------------------------------------- Total from investment operations .39 (1.39) (.92) .23 - ---------------------------------------------------------------------------------------------------------- LESS DISTRIBUTIONS: Dividends from net investment income (.14) (.04) (.04) (.08) Distributions from realized gains -- (.15) (.37) (.51) - ---------------------------------------------------------------------------------------------------------- Total distributions (.14) (.19) (.41) (.59) - ---------------------------------------------------------------------------------------------------------- Net asset value, end of period $4.55 $4.30 $5.88 $7.21 - ---------------------------------------------------------------------------------------------------------- TOTAL RETURN 9.11% (23.30%) (13.51%) 3.31% - ---------------------------------------------------------------------------------------------------------- RATIOS TO AVERAGE NET ASSETS(a) Gross expenses prior to expense waiver/reimbursement 1.38%(b) 1.32% 1.41% 1.49%(b) - ---------------------------------------------------------------------------------------------------------- Net expenses after expense waiver/reimbursement(c) 1.32%(b) 1.16% 1.16% 1.48%(b) - ---------------------------------------------------------------------------------------------------------- Net investment income (loss) .48%(b) 1.92% 1.15% .55%(b) - ---------------------------------------------------------------------------------------------------------- SUPPLEMENTAL DATA Net assets, end of period (in millions) $2 $-- $-- $-- - ---------------------------------------------------------------------------------------------------------- Portfolio turnover rate 30% 61% 58% 62% - ----------------------------------------------------------------------------------------------------------
See accompanying Notes to Financial Highlights. - -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 33 FINANCIAL HIGHLIGHTS (continued) -----------------------------------------------
SIX MONTHS ENDED YEAR ENDED JULY 31, CLASS R3 JAN. 31, 2010 --------------------------------- PER SHARE DATA (UNAUDITED) 2009 2008 2007(e) Net asset value, beginning of period $4.30 $5.89 $7.22 $7.57 - ---------------------------------------------------------------------------------------------------------- INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) .02 .09 .09 .04 Net gains (losses) (both realized and unrealized) .38 (1.47) (.99) .20 - ---------------------------------------------------------------------------------------------------------- Total from investment operations .40 (1.38) (.90) .24 - ---------------------------------------------------------------------------------------------------------- LESS DISTRIBUTIONS: Dividends from net investment income (.15) (.06) (.06) (.08) Distributions from realized gains -- (.15) (.37) (.51) - ---------------------------------------------------------------------------------------------------------- Total distributions (.15) (.21) (.43) (.59) - ---------------------------------------------------------------------------------------------------------- Net asset value, end of period $4.55 $4.30 $5.89 $7.22 - ---------------------------------------------------------------------------------------------------------- TOTAL RETURN 9.35% (23.17%) (13.26%) 3.46% - ---------------------------------------------------------------------------------------------------------- RATIOS TO AVERAGE NET ASSETS(a) Gross expenses prior to expense waiver/reimbursement 1.10%(b) 1.10% 1.15% 1.24%(b) - ---------------------------------------------------------------------------------------------------------- Net expenses after expense waiver/reimbursement(c) 1.05%(b) .94% .90% 1.22%(b) - ---------------------------------------------------------------------------------------------------------- Net investment income (loss) .97%(b) 2.11% 1.41% .81%(b) - ---------------------------------------------------------------------------------------------------------- SUPPLEMENTAL DATA Net assets, end of period (in millions) $-- $-- $-- $-- - ---------------------------------------------------------------------------------------------------------- Portfolio turnover rate 30% 61% 58% 62% - ----------------------------------------------------------------------------------------------------------
See accompanying Notes to Financial Highlights. - -------------------------------------------------------------------------------- 34 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT - --------------------------------------------------------------------------------
SIX MONTHS ENDED YEAR ENDED JULY 31, CLASS R4 JAN. 31, 2010 ------------------------------------------------------- PER SHARE DATA (UNAUDITED) 2009 2008 2007 2006 2005 Net asset value, beginning of period $4.32 $5.91 $7.25 $6.76 $6.71 $5.95 - -------------------------------------------------------------------------------------------------------------------------------- INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) .03 .10 .10 .09 .07 .05 Net gains (losses) (both realized and unrealized) .38 (1.48) (1.00) .98 .36 .91 - -------------------------------------------------------------------------------------------------------------------------------- Total from investment operations .41 (1.38) (.90) 1.07 .43 .96 - -------------------------------------------------------------------------------------------------------------------------------- LESS DISTRIBUTIONS: Dividends from net investment income (.16) (.06) (.07) (.07) (.07) (.04) Distributions from realized gains -- (.15) (.37) (.51) (.31) (.16) - -------------------------------------------------------------------------------------------------------------------------------- Total distributions (.16) (.21) (.44) (.58) (.38) (.20) - -------------------------------------------------------------------------------------------------------------------------------- Net asset value, end of period $4.57 $4.32 $5.91 $7.25 $6.76 $6.71 - -------------------------------------------------------------------------------------------------------------------------------- TOTAL RETURN 9.58% (23.05%) (13.26%) 16.15% 6.48% 16.25% - -------------------------------------------------------------------------------------------------------------------------------- RATIOS TO AVERAGE NET ASSETS(a) Gross expenses prior to expense waiver/reimbursement .87%(b) .86% .91% .95% .87% 1.18% - -------------------------------------------------------------------------------------------------------------------------------- Net expenses after expense waiver/reimbursement(c) .80%(b) .78% .84% .87% .84% 1.06% - -------------------------------------------------------------------------------------------------------------------------------- Net investment income (loss) 1.25%(b) 2.28% 1.47% 1.29% 1.10% 1.03% - -------------------------------------------------------------------------------------------------------------------------------- SUPPLEMENTAL DATA Net assets, end of period (in millions) $159 $90 $126 $158 $224 $-- - -------------------------------------------------------------------------------------------------------------------------------- Portfolio turnover rate 30% 61% 58% 62% 137% 64% - --------------------------------------------------------------------------------------------------------------------------------
See accompanying Notes to Financial Highlights. - -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 35 FINANCIAL HIGHLIGHTS (continued) -----------------------------------------------
SIX MONTHS ENDED YEAR ENDED JULY 31, CLASS R5 JAN. 31, 2010 --------------------------------- PER SHARE DATA (UNAUDITED) 2009 2008 2007(e) Net asset value, beginning of period $4.31 $5.90 $7.24 $7.57 - ---------------------------------------------------------------------------------------------------------- INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) .03 .11 .11 .06 Net gains (losses) (both realized and unrealized) .38 (1.48) (1.00) .20 - ---------------------------------------------------------------------------------------------------------- Total from investment operations .41 (1.37) (.89) .26 - ---------------------------------------------------------------------------------------------------------- LESS DISTRIBUTIONS: Dividends from net investment income (.17) (.07) (.08) (.08) Distributions from realized gains -- (.15) (.37) (.51) - ---------------------------------------------------------------------------------------------------------- Total distributions (.17) (.22) (.45) (.59) - ---------------------------------------------------------------------------------------------------------- Net asset value, end of period $4.55 $4.31 $5.90 $7.24 - ---------------------------------------------------------------------------------------------------------- TOTAL RETURN 9.60% (22.91%) (13.09%) 3.76% - ---------------------------------------------------------------------------------------------------------- RATIOS TO AVERAGE NET ASSETS(a) Gross expenses prior to expense waiver/reimbursement .63%(b) .58% .66% .75%(b) - ---------------------------------------------------------------------------------------------------------- Net expenses after expense waiver/reimbursement(c) .57%(b) .58% .66% .74%(b) - ---------------------------------------------------------------------------------------------------------- Net investment income (loss) 1.25%(b) 2.48% 1.66% 1.28%(b) - ---------------------------------------------------------------------------------------------------------- SUPPLEMENTAL DATA Net assets, end of period (in millions) $24 $-- $-- $-- - ---------------------------------------------------------------------------------------------------------- Portfolio turnover rate 30% 61% 58% 62% - ----------------------------------------------------------------------------------------------------------
See accompanying Notes to Financial Highlights. - -------------------------------------------------------------------------------- 36 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT - --------------------------------------------------------------------------------
SIX MONTHS ENDED YEAR ENDED JULY 31, CLASS W JAN. 31, 2010 --------------------------------- PER SHARE DATA (UNAUDITED) 2009 2008 2007(f) Net asset value, beginning of period $4.29 $5.86 $7.22 $7.46 - ---------------------------------------------------------------------------------------------------------- INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) .03 .09 .08 .03 Net gains (losses) (both realized and unrealized) .37 (1.47) (1.00) .32 - ---------------------------------------------------------------------------------------------------------- Total from investment operations .40 (1.38) (.92) .35 - ---------------------------------------------------------------------------------------------------------- LESS DISTRIBUTIONS: Dividends from net investment income (.15) (.04) (.07) (.08) Distributions from realized gains -- (.15) (.37) (.51) - ---------------------------------------------------------------------------------------------------------- Total distributions (.15) (.19) (.44) (.59) - ---------------------------------------------------------------------------------------------------------- Net asset value, end of period $4.54 $4.29 $5.86 $7.22 - ---------------------------------------------------------------------------------------------------------- TOTAL RETURN 9.35% (23.21%) (13.52%) 5.01% - ---------------------------------------------------------------------------------------------------------- RATIOS TO AVERAGE NET ASSETS(a) Gross expenses prior to expense waiver/reimbursement 1.01%(b) 1.01% 1.06% 1.18%(b) - ---------------------------------------------------------------------------------------------------------- Net expenses after expense waiver/reimbursement(c) .94%(b) 1.01% 1.06% 1.13%(b) - ---------------------------------------------------------------------------------------------------------- Net investment income (loss) 1.29%(b) 2.07% 1.22% .59%(b) - ---------------------------------------------------------------------------------------------------------- SUPPLEMENTAL DATA Net assets, end of period (in millions) $492 $726 $1,355 $745 - ---------------------------------------------------------------------------------------------------------- Portfolio turnover rate 30% 61% 58% 62% - ----------------------------------------------------------------------------------------------------------
NOTES TO FINANCIAL HIGHLIGHTS (a) Includes the impact of a performance incentive adjustment, if any. In addition to the fees and expenses which the Fund bears directly, the Fund indirectly bears a pro rata share of the fees and expenses of the acquired funds in which it invests. Such indirect expenses are not included in the reported expense ratios. (b) Annualized. (c) The Investment Manager and its affiliates have agreed to waive/reimburse certain fees and expenses (excluding fees and expenses of acquired funds), before giving effect to any performance incentive adjustment. (d) Rounds to zero. (e) For the period from Dec. 11, 2006 (when shares became publicly available) to July 31, 2007. (f) For the period from Dec. 1, 2006 (when shares became publicly available) to July 31, 2007. The accompanying Notes to Financial Statements are an integral part of this statement. - -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 37 NOTES TO FINANCIAL STATEMENTS -------------------------------------------------- (UNAUDITED AS OF JAN. 31, 2010) 1. ORGANIZATION RiverSource Disciplined Equity Fund (the Fund) is a series of RiverSource Large Cap Series, Inc. (the Corporation) and is registered under the Investment Company Act of 1940, as amended (the 1940 Act) as a diversified, open-end management investment company. The Corporation has 10 billion authorized shares of capital stock that can be allocated among the separate series as designated by the Corporation's Board of Directors (the Board). The Fund invests primarily in equity securities of companies listed on U.S. exchanges with market capitalizations greater than $5 billion at the time of purchase. The Fund offers Class A, Class B, Class C, Class I, Class R2, Class R3, Class R4, Class R5 and Class W shares. - - Class A shares are offered with a front-end sales charge, which may be waived under certain circumstances. - - Class B shares may be subject to a contingent deferred sales charge (CDSC) and automatically convert to Class A shares one month after the completion of the eighth year of ownership if originally purchased in a RiverSource fund on or after May 21, 2005 or originally purchased in a Seligman fund on or after June 13, 2009. Class B shares originally purchased in a RiverSource fund prior to May 21, 2005 will convert to Class A shares in the ninth calendar year of ownership. Class B shares originally purchased in a Seligman fund prior to June 13, 2009 will convert to Class A shares in the month prior to the ninth year of ownership. - - Class C shares may be subject to a CDSC. - - Class I, Class R2, Class R3, Class R4 and Class R5 shares are offered without a front-end sales charge or CDSC to qualifying institutional investors. - - Class W shares are offered without a front-end sales charge or CDSC and are offered through qualifying discretionary accounts. At Jan. 31, 2010, RiverSource Investments, LLC (RiverSource Investments or the Investment Manager) and affiliated funds-of-funds in the RiverSource Family of Funds owned 100% of Class I shares, and the Investment Manager owned 100% of Class R3 shares. All classes of shares have identical voting, dividend and liquidation rights. Class specific expenses (e.g., distribution and service fees, transfer agency fees, plan administration services fees) differ among classes. Income, expenses (other than class specific expenses) and realized and unrealized gains or losses on investments are allocated to each class of shares based upon its relative net assets. - -------------------------------------------------------------------------------- 38 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT - -------------------------------------------------------------------------------- 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ADOPTION OF NEW ACCOUNTING STANDARD In June 2009, the Financial Accounting Standards Board (FASB) established the FASB Accounting Standards Codification(TM )(Codification) as the single source of authoritative accounting principles recognized by the FASB in the preparation of financial statements in conformity with U.S. generally accepted accounting principles (GAAP). The Codification supersedes existing non-grandfathered, non- SEC accounting and reporting standards. The Codification did not change GAAP but, rather, organized it into a hierarchy where all guidance within the Codification carries an equal level of authority. The Codification became effective for financial statements issued for interim and annual periods ending after Sept. 15, 2009. The Codification did not have an effect on the Fund's financial statements. USE OF ESTIMATES Preparing financial statements that conform to U.S. generally accepted accounting principles requires management to make estimates (e.g., on assets, liabilities and contingent assets and liabilities) that could differ from actual results. VALUATION OF SECURITIES All securities are valued at the close of business of the New York Stock Exchange (NYSE). Securities traded on national securities exchanges or included in national market systems are valued at the last quoted sales price from the primary exchange. Debt securities are generally traded in the over-the-counter market and are valued by an independent pricing service using an evaluated bid. When market quotes are not readily available, the pricing service, in determining fair values of debt securities, takes into consideration such factors as current quotations by broker/dealers, coupon, maturity, quality, type of issue, trading characteristics, and other yield and risk factors it deems relevant in determining valuations. Foreign securities are valued based on quotations from the principal market in which such securities are normally traded. The procedures adopted by the Board generally contemplate the use of fair valuation in the event that price quotations or valuations are not readily available, price quotations or valuations from other sources are not reflective of market value and thus deemed unreliable, or a significant event has occurred in relation to a security or class of securities (such as foreign securities) that is not reflected in price quotations or valuations from other sources. A fair value price is a good faith estimate of the value of a security at a given point in time. Many securities markets and exchanges outside the U.S. close prior to the close of the NYSE and therefore the closing prices for securities in such markets or on - -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 39 NOTES TO FINANCIAL STATEMENTS (continued) -------------------------------------- such exchanges may not fully reflect events that occur after such close but before the close of the NYSE, including significant movements in the U.S. market after foreign exchanges have closed. Accordingly, in those situations, Ameriprise Financial, Inc. (Ameriprise Financial), parent company of the Investment Manager, as administrator to the Fund, will fair value foreign securities pursuant to procedures adopted by the Board, including utilizing a third party pricing service to determine these fair values. These procedures take into account multiple factors, including movements in the U.S. securities markets, to determine a good faith estimate that reasonably reflects the current market conditions as of the close of the NYSE. The fair value of a security is likely to be different from the quoted or published price, if available. Short-term securities maturing in more than 60 days from the valuation date are valued at the market price or approximate market value based on current interest rates. Typically, those maturing in 60 days or less that originally had maturities of more than 60 days at acquisition date are valued at amortized cost using the market value on the 61(st) day before maturity. Short-term securities maturing in 60 days or less at acquisition date are valued at amortized cost. Amortized cost is an approximation of market value. Investments in money market funds are valued at net asset value. FOREIGN CURRENCY TRANSLATIONS Securities and other assets and liabilities denominated in foreign currencies are translated daily into U.S. dollars. Foreign currency amounts related to the purchase or sale of securities and income and expenses are translated at the exchange rate on the transaction date. The effect of changes in foreign exchange rates on realized and unrealized security gains or losses is reflected as a component of such gains or losses. In the Statement of Operations, net realized gains or losses from foreign currency transactions, if any, may arise from sales of foreign currency, closed forward contracts, exchange gains or losses realized between the trade date and settlement date on securities transactions, and other translation gains or losses on dividends, interest income and foreign withholding taxes. REPURCHASE AGREEMENTS The Fund may enter into repurchase agreements. Generally, securities received as collateral subject to repurchase agreements are deposited with the Fund's custodian and, pursuant to the terms of the repurchase agreement, must have an aggregate market value greater than or equal to the repurchase price plus accrued interest at all times. On a daily basis, the market value of securities held as collateral for repurchase agreements is monitored to ensure the existence of the proper level of collateral. - -------------------------------------------------------------------------------- 40 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT - -------------------------------------------------------------------------------- ILLIQUID SECURITIES At Jan. 31, 2010, investments in securities included issues that are illiquid which the Fund currently limits to 15% of net assets, at market value, at the time of purchase. The aggregate value of such securities at Jan. 31, 2010 was $394,748 representing 0.01% of net assets. Certain illiquid securities may be valued, in good faith, by management at fair value according to procedures approved by the Board. According to Board guidelines, certain unregistered securities are determined to be liquid and are not included within the 15% limitation specified above. Assets are liquid if they can be sold or disposed of in the ordinary course of business within seven days at approximately the value at which the asset is valued by the Fund. GUARANTEES AND INDEMNIFICATIONS Under the Fund's organizational documents, its officers and directors are indemnified against certain liabilities arising out of the performance of their duties to the Fund. In addition, certain of the Fund's contracts with its service providers contain general indemnification clauses. The Fund's maximum exposure under these arrangements is unknown since the amount of any future claims that may be made against the Fund cannot be determined and the Fund has no historical basis for predicting the likelihood of any such claims. FEDERAL TAXES The Fund's policy is to comply with Subchapter M of the Internal Revenue Code that applies to regulated investment companies and to distribute substantially all of its taxable income (which includes net short-term capital gains) to shareholders. No provision for income or excise taxes is thus required. Management of the Fund has concluded that there are no significant uncertain tax positions that would require recognition in the financial statements. Generally, the tax authorities can examine all tax returns filed for the last three years. DIVIDENDS TO SHAREHOLDERS An annual dividend from net investment income, declared and paid at the end of the calendar year, when available, is reinvested in additional shares of the Fund at net asset value or payable in cash. Capital gains, when available, are distributed along with the income dividend. On Sept. 9, 2009, an additional dividend was paid before the mergers (see Note 10) to ensure that the current shareholders of RiverSource Disciplined Equity Fund would not experience a dilution in their shares of the Fund's income or capital gains. - -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 41 NOTES TO FINANCIAL STATEMENTS (continued) -------------------------------------- OTHER Security transactions are accounted for on the date securities are purchased or sold. Dividend income is recognized on the ex-dividend date and interest income, including amortization of premium, market discount and original issue discount using the effective interest method, is accrued daily. 3. INVESTMENTS IN DERIVATIVES The Fund may invest in certain derivative instruments, which are transactions whose values depend on or are derived from (in whole or in part) the value of one or more other assets, such as securities, currencies, commodities or indices. Such derivative instruments may be used to maintain cash reserves while maintaining exposure to certain other assets, to offset anticipated declines in values of investments, to facilitate trading, to reduce transaction costs, and to pursue higher investment returns. The Fund may also use derivative instruments to mitigate certain investment risks, such as foreign currency exchange rate risk, interest rate risk, and credit risk. Investments in derivative instruments may expose the Fund to certain additional risks, including those detailed below. FUTURES TRANSACTIONS The Fund may buy and sell financial futures contracts traded on any U.S. or foreign exchange to produce incremental earnings, hedge existing positions or protect against market changes in the value of equities, interest rates or foreign currencies. The Fund may also buy and write put and call options on these futures contracts. A futures contract represents a commitment for the future purchase or sale of an asset at a specified price on a specified date. Futures and options on futures are valued daily based upon the last sale price at the close of the market on the principal exchange on which they are traded. Upon entering into a futures contract, the Fund is required to deposit either cash or securities in an amount (initial margin) equal to a certain percentage of the contract value. Subsequent payments (variation margin) are made or received by the Fund each day. The variation margin payments are equal to the daily changes in the contract value and are recorded as unrealized gains and losses. The Fund recognizes a realized gain or loss when the contract is closed or expires. Upon entering into futures contracts, the Fund bears the risk of interest rates, exchange rates or securities prices moving unexpectedly, in which case, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. Additional risks include counterparty credit risk, the possibility of an illiquid market, and that a change in the value of the contract or option may not correlate with changes in the value of the underlying securities. - -------------------------------------------------------------------------------- 42 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT - -------------------------------------------------------------------------------- EFFECTS OF DERIVATIVE TRANSACTIONS ON THE FINANCIAL STATEMENTS The following tables are intended to provide additional information about the effect of derivatives on the financial statements of the Fund including: the fair value of derivatives by risk category and the location of those fair values in the Statement of Assets and Liabilities; the impact of derivative transactions on the Fund's operations over the period including realized gains or losses and unrealized gains or losses. The derivative schedules following the Portfolio of Investments present additional information regarding derivative instruments outstanding at the end of the period, if any. FAIR VALUES OF DERIVATIVE INSTRUMENTS AT JAN. 31, 2010
ASSET DERIVATIVES LIABILITY DERIVATIVES ------------------------------- ------------------------------------- STATEMENT OF ASSETS STATEMENT OF ASSETS RISK EXPOSURE AND LIABILITIES AND LIABILITIES CATEGORY LOCATION FAIR VALUE LOCATION FAIR VALUE - ------------------------------------------------------------------------------------------- Equity contracts Net assets --unrealized depreciation on N/A N/A investments $583,651* - ------------------------------------------------------------------------------------------- Total N/A N/A $583,651 - -------------------------------------------------------------------------------------------
* Includes cumulative appreciation (depreciation) of futures contracts as reported in the Futures Contracts Outstanding table following the Portfolio of Investments. Only the current day's variation margin is reported in receivables or payables in the Statement of Assets and Liabilities. EFFECT OF DERIVATIVE INSTRUMENTS IN THE STATEMENT OF OPERATIONS FOR THE SIX MONTHS ENDED JAN. 31, 2010
AMOUNT OF REALIZED GAIN (LOSS) ON DERIVATIVES RECOGNIZED IN INCOME - ------------------------------------------------------------------ RISK EXPOSURE CATEGORY FUTURES - ------------------------------------------------------------------ Equity contracts $5,572,060 - ------------------------------------------------------------------ Total $5,572,060 - ------------------------------------------------------------------
CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON DERIVATIVES RECOGNIZED IN INCOME - ----------------------------------------------------------------- RISK EXPOSURE CATEGORY FUTURES - ----------------------------------------------------------------- Equity contracts $(739,761) - ----------------------------------------------------------------- Total $(739,761) - -----------------------------------------------------------------
VOLUME OF DERIVATIVE ACTIVITY FUTURES The gross notional amount of long contracts outstanding was $23.6 million at Jan. 31, 2010. The monthly average gross notional amount for these contracts - -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 43 NOTES TO FINANCIAL STATEMENTS (continued) -------------------------------------- was $21.4 million for the six months ended Jan. 31, 2010. The fair value of such contracts on Jan. 31, 2010 is set forth in the table above. 4. EXPENSES AND SALES CHARGES INVESTMENT MANAGEMENT SERVICES FEES Under an Investment Management Services Agreement, the Investment Manager determines which securities will be purchased, held or sold. The management fee is an annual fee that is equal to a percentage of the Fund's average daily net assets that declines from 0.60% to 0.375% as the Fund's net assets increase. The fee may be adjusted upward or downward by a performance incentive adjustment determined monthly by measuring the percentage difference over a rolling 12- month period between the annualized performance of one Class A share of the Fund and the annualized performance of the Lipper Large-Cap Core Funds Index. In certain circumstances, the Board may approve a change in the index. The maximum adjustment is 0.12% per year. If the performance difference is less than 0.50%, the adjustment will be zero. The adjustment decreased the management fee by $1,233,031 for the six months ended Jan. 31, 2010. The management fee for the six months ended Jan. 31, 2010 was 0.50% of the Fund's average daily net assets, including the adjustment under the terms of the performance incentive arrangement. ADMINISTRATIVE SERVICES FEES Under an Administrative Services Agreement, the Fund pays Ameriprise Financial an annual fee for administration and accounting services equal to a percentage of the Fund's average daily net assets that declines from 0.06% to 0.03% as the Fund's net assets increase. The fee for the six months ended Jan. 31, 2010 was 0.05% of the Fund's average daily net assets. OTHER FEES Other expenses are for, among other things, certain expenses of the Fund or the Board including: Fund boardroom and office expense, employee compensation, employee health and retirement benefits, and certain other expenses. Payment of these Fund and Board expenses is facilitated by a company providing limited administrative services to the Fund and the Board. For the six months ended Jan. 31, 2010, there were no expenses incurred for these particular items. COMPENSATION OF BOARD MEMBERS Under a Deferred Compensation Plan (the Plan), the board members who are not "interested persons" of the Fund under the 1940 Act may defer receipt of their compensation. Deferred amounts are treated as though equivalent dollar amounts had been invested in shares of the Fund or other funds in the RiverSource Family - -------------------------------------------------------------------------------- 44 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT - -------------------------------------------------------------------------------- of Funds. The Fund's liability for these amounts is adjusted for market value changes and remains in the funds until distributed in accordance with the Plan. TRANSFER AGENCY FEES Under a Transfer Agency Agreement, RiverSource Service Corporation (the Transfer Agent) maintains Fund shareholder accounts and records and provides Fund shareholder services. The Fund pays the Transfer Agent an annual account-based fee at a rate equal to $19.50 for Class A, $20.50 for Class B and $20.00 for Class C for this service. The Transfer Agent also charges an annual fee of $3 per account serviced directly by the Fund or its designated agent for Class A, Class B and Class C shares. The Fund also pays the Transfer Agent an annual asset-based fee at a rate of 0.05% of the Fund's average daily net assets attributable to Class R2, Class R3, Class R4 and Class R5 shares and an annual asset-based fee at a rate of 0.20% of the Fund's average daily net assets attributable to Class W shares. The Transfer Agent charges an annual fee of $5 per inactive account, charged on a pro rata basis for the 12 month period from the date the account becomes inactive. These fees are included in the transfer agency fees in the Statement of Operations. In connection with the acquisition of Seligman Common Stock Fund (see Note 10), the Fund assumed the assets and obligations of Seligman Common Stock Fund, which, together with certain other associated investment companies (together, the Guarantors), has severally, but not jointly, guaranteed the performance and observance of all terms and conditions of a lease entered into by Seligman Data Corp. (SDC), the former transfer agent of Seligman Common Stock Fund, including the payment of rent by SDC (the Guaranty). The lease and the Guaranty expire in January 2019. At Jan. 31, 2010, the Fund's total potential future obligation over the life of the Guaranty is $138,823. Seligman Common Stock Fund expensed $134,526 related to Guaranty prior to acquisition by the Fund. This amount is included within other accrued expenses in the Fund's Statement of Assets and Liabilities. SDC is owned by six associated investment companies, including the Fund. The Fund's ownership interest in SDC at Jan. 31, 2010 is included in other assets in the Statement of Assets and Liabilities at cost of $22,506. PLAN ADMINISTRATION SERVICES FEES Under a Plan Administration Services Agreement with the Transfer Agent, the Fund pays an annual fee at a rate of 0.25% of the Fund's average daily net assets attributable to Class R2, Class R3 and Class R4 shares for the provision of various administrative, recordkeeping, communication and educational services. - -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 45 NOTES TO FINANCIAL STATEMENTS (continued) -------------------------------------- DISTRIBUTION FEES The Fund has an agreement with RiverSource Fund Distributors, Inc. (the Distributor) for distribution and shareholder services. Under a Plan and Agreement of Distribution pursuant to Rule 12b-1, the Fund pays a fee at an annual rate of up to 0.25% of the Fund's average daily net assets attributable to Class A, Class R3 and Class W shares, a fee at an annual rate of up to 0.50% of the Fund's average daily net assets attributable to Class R2 shares and a fee at an annual rate of up to 1.00% of the Fund's average daily net assets attributable to Class B and Class C shares. For Class B and Class C shares, of the 1.00% fee, up to 0.75% is reimbursed for distribution expenses. The amount of distribution expenses incurred by the Distributor and not yet reimbursed (unreimbursed expense) was approximately $547,000 and $24,000 for Class B and Class C shares, respectively. These amounts are based on the most recent information available as of Oct. 31, 2009, and may be recovered from future payments under the distribution plan or CDSC. To the extent the unreimbursed expense has been fully recovered, the distribution fee is reduced. SALES CHARGES Sales charges, including front-end and CDSCs, received by the Distributor for distributing Fund shares were $636,388 for Class A, $87,683 for Class B and $835 for Class C for the six months ended Jan. 31, 2010. EXPENSES WAIVED/REIMBURSED BY THE INVESTMENT MANAGER AND ITS AFFILIATES For the six months ended Jan. 31, 2010, the Investment Manager and its affiliates waived/reimbursed certain fees and expenses such that net expenses (excluding fees and expenses of acquired funds*), including the adjustment under the terms of a performance incentive arrangement, were as follows: Class A.............................................. 0.96% Class B.............................................. 1.74 Class C.............................................. 1.72 Class I.............................................. 0.49 Class R2............................................. 1.32 Class R3............................................. 1.05 Class R4............................................. 0.80 Class R5............................................. 0.57 Class W.............................................. 0.94
The waived/reimbursed fees and expenses for the transfer agency fees at the class level were as follows: Class A........................................... $979,729 Class B........................................... 72,261 Class C........................................... 8,672
- -------------------------------------------------------------------------------- 46 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT - -------------------------------------------------------------------------------- The management fees waived/reimbursed at the Fund level were $1,204,155. The Investment Manager and its affiliates have contractually agreed to waive certain fees and expenses until Sept. 30, 2010, unless sooner terminated at the sole discretion of the Board, such that net expenses (excluding fees and expenses of acquired funds*), before giving effect to any performance incentive adjustment, will not exceed the following percentage of the class' average daily net assets: Class A.............................................. 1.02% Class B.............................................. 1.80 Class C.............................................. 1.78 Class I.............................................. 0.57 Class R2............................................. 1.37 Class R3............................................. 1.12 Class R4............................................. 0.87 Class R5............................................. 0.62 Class W.............................................. 1.02
* In addition to the fees and expenses which the Fund bears directly, the Fund indirectly bears a pro rata share of the fees and expenses of the funds in which it invests (also referred to as "acquired funds"), including affiliated and non-affiliated pooled investment vehicles (including mutual funds and exchange traded funds). Because the acquired funds have varied expense and fee levels and the Fund may own different proportions of acquired funds at different times, the amount of fees and expenses incurred indirectly by the Fund will vary. 5. SECURITIES TRANSACTIONS Cost of purchases (other than short-term obligations) aggregated $3,415,806,451 for the six months ended Jan. 31, 2010 (including $2,341,695,402* from RiverSource Large Cap Equity Fund and Seligman Common Stock Fund that were acquired in the fund mergers as described in Note 10 and $25,611,418* of purchases done to realign the Fund's portfolio following the mergers. Proceeds from sales of securities (other than short-term obligations) aggregated $1,665,055,436 for six month ended Jan. 31, 2010 (including $25,611,418* of sales done to realign the Fund's portfolio following the mergers. Realized gains and losses are determined on an identified cost basis. * Amounts are excluded for purposes of calculating the Fund's portfolio turnover rate. - -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 47 NOTES TO FINANCIAL STATEMENTS (continued) -------------------------------------- 6. CAPITAL SHARE TRANSACTIONS Transactions in shares of capital stock for the periods indicated are as follows:
SIX MONTHS ENDED YEAR ENDED JAN. 31, 2010 JULY 31, 2009 - ---------------------------------------------------------------------- CLASS A Sold 5,095,949 6,821,872 Fund merger 481,393,025 N/A Converted from Class B* 26,148 1,149,578 Reinvested distributions 9,418,476 7,831,648 Redeemed (52,195,835) (36,445,132) - ---------------------------------------------------------------------- Net increase (decrease) 443,737,763 (20,642,034) - ---------------------------------------------------------------------- CLASS B Sold 1,057,882 499,210 Fund merger 46,018,619 N/A Reinvested distributions 439,265 200,930 Converted to Class A* (26,193) (1,160,372) Redeemed (4,254,977) (1,988,665) - ---------------------------------------------------------------------- Net increase (decrease) 43,234,596 (2,448,897) - ---------------------------------------------------------------------- CLASS C Sold 321,525 128,711 Fund merger 4,760,196 N/A Reinvested distributions 46,331 18,704 Redeemed (522,314) (132,782) - ---------------------------------------------------------------------- Net increase (decrease) 4,605,738 14,633 - ---------------------------------------------------------------------- CLASS I Sold 4,235,738 23,916,807 Fund merger 8,392,835 N/A Reinvested distributions 2,889,508 3,905,496 Redeemed (19,381,641) (17,233,065) - ---------------------------------------------------------------------- Net increase (decrease) (3,863,560) 10,589,238 - ---------------------------------------------------------------------- CLASS R2 Sold 108,799 N/A Fund merger 420,791 N/A Reinvested distributions 662 N/A Redeemed (84,204) N/A - ---------------------------------------------------------------------- Net increase (decrease) 446,048 N/A - ---------------------------------------------------------------------- CLASS R3 Fund merger 612 N/A - ---------------------------------------------------------------------- Net increase (decrease) 612 N/A - ----------------------------------------------------------------------
- -------------------------------------------------------------------------------- 48 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT - --------------------------------------------------------------------------------
SIX MONTHS ENDED YEAR ENDED JAN. 31, 2010 JULY 31, 2009 - ---------------------------------------------------------------------- CLASS R4 Sold 1,690,525 2,764,051 Fund merger 15,915,653 N/A Reinvested distributions 877,433 1,083,396 Redeemed (4,410,123) (4,474,270) - ---------------------------------------------------------------------- Net increase (decrease) 14,073,488 (626,823) - ---------------------------------------------------------------------- CLASS R5 Sold 193,581 -- Fund merger 5,440,327 -- Reinvested distributions 59,413 -- Redeemed (510,601) -- - ---------------------------------------------------------------------- Net increase (decrease) 5,182,720 -- - ---------------------------------------------------------------------- CLASS W Sold 8,273,221 79,709,796 Reinvested distributions 4,787,849 10,352,737 Redeemed (73,911,547) (152,063,288) - ---------------------------------------------------------------------- Net increase (decrease) (60,850,477) (62,000,755) - ----------------------------------------------------------------------
* Automatic conversion of Class B to Class A shares based on the original purchase date. 7. LENDING OF PORTFOLIO SECURITIES The Fund has entered into a Master Securities Lending Agreement (the Agreement) with JPMorgan Chase Bank, National Association (JPMorgan). The Agreement authorizes JPMorgan as lending agent to lend securities to authorized borrowers in order to generate additional income on behalf of the Fund. Pursuant to the Agreement, the securities loaned are secured by cash or U.S. government securities equal to at least 100% of the market value of the loaned securities. Any additional collateral required to maintain those levels due to market fluctuations of the loaned securities is delivered the following business day. Cash collateral received is invested by the lending agent on behalf of the Fund into authorized investments pursuant to the Agreement. The investments made with the cash collateral are listed in the Portfolio of Investments. The values of such investments and any uninvested cash collateral balance are disclosed in the Statement of Assets and Liabilities along with the related obligation to return the collateral upon the return of the securities loaned. At Jan. 31, 2010, securities valued at $965,533,920 were on loan, secured by cash collateral of $1,003,675,139 invested in short-term securities or in cash equivalents. - -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 49 NOTES TO FINANCIAL STATEMENTS (continued) -------------------------------------- Risks of delay in recovery of securities or even loss of rights in the securities may occur should the borrower of the securities fail financially. Risks may also arise to the extent that the value of the securities loaned increases above the value of the collateral received. JPMorgan will indemnify the Fund from losses resulting from a borrower's failure to return a loaned security when due. Such indemnification does not extend to losses associated with declines in the value of cash collateral investments. Loans are subject to termination by the Fund or the borrower at any time, and are, therefore, not considered to be illiquid investments. Pursuant to the Agreement, the Fund receives income for lending its securities either in the form of fees or by earning interest on invested cash collateral, net of negotiated rebates paid to borrowers and fees paid to the lending agent for services provided and any other securities lending expenses. Net income of $1,092,965 earned from securities lending for the six months ended Jan. 31, 2010 is included in the Statement of Operations. The Fund also continues to earn interest and dividends on the securities loaned. 8. AFFILIATED MONEY MARKET FUND The Fund may invest its daily cash balance in RiverSource Short-Term Cash Fund, a money market fund established for the exclusive use of the funds in the RiverSource Family of Funds and other institutional clients of RiverSource Investments. The cost of the Fund's purchases and proceeds from sales of shares of RiverSource Short-Term Cash Fund aggregated $436,141,607 and $436,101,788, respectively, for the six months ended Jan. 31, 2010. The income distributions received with respect to the Fund's investment in RiverSource Short-Term Cash Fund can be found in the Statement of Operations and the Fund's invested balance in RiverSource Short-Term Cash Fund at Jan. 31, 2010, can be found in the Portfolio of Investments. 9. BANK BORROWINGS The Fund has entered into a revolving credit facility with a syndicate of banks led by JPMorgan Chase Bank, N.A. (the Administrative Agent), whereby the Fund may borrow for the temporary funding of shareholder redemptions or for other temporary or emergency purposes. The credit facility became effective on Oct. 15, 2009, replacing a prior credit facility. The credit facility agreement, which is a collective agreement between the Fund and certain other funds in the RiverSource Family of Funds, severally and not jointly, permits collective borrowings up to $300 million. The borrowers shall have the right, upon written notice to the Administrative Agent to request an increase of up to $200 million in the aggregate amount of the credit facility from new or existing lenders, - -------------------------------------------------------------------------------- 50 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT - -------------------------------------------------------------------------------- provided that the aggregate amount of the credit facility shall at no time exceed $500 million. Participation in such increase by any existing lender shall be at such lender's sole discretion. Interest is charged to each Fund based on its borrowings at a rate equal to the sum of the federal funds rate plus (i) 1.25% per annum plus (ii) if one-month LIBOR exceeds the federal funds rate, the amount of such excess. Each borrowing under the credit facility matures no later than 60 days after the date of borrowing. The Fund also pays a commitment fee equal to its pro rata share of the amount of the credit facility at a rate of 0.10% per annum, in addition to an upfront fee equal to its pro rata share of 0.04% of the amount of the credit facility. Prior to Oct. 15, 2009, the credit facility agreement, which was a collective agreement between the Fund and certain other funds in the RiverSource Family of Funds, severally and not jointly, permitted collective borrowings up to $475 million. Interest was charged to each Fund based on its borrowings at a rate equal to the federal funds rate plus 0.75%. The Fund also paid a commitment fee equal to its pro rata share of the amount of the credit facility at a rate of 0.06% per annum, in addition to an upfront fee equal to its pro rata share of 0.02% of the amount of the credit facility. The Fund had no borrowings during the six months ended Jan. 31, 2010. 10. FUND MERGERS At the close of business on Sept. 11, 2009, RiverSource Disciplined Equity Fund acquired the assets and assumed the identified liabilities of RiverSource Large Cap Equity Fund and Seligman Common Stock Fund. The reorganizations were completed after shareholders approved the plans on June 2, 2009. The aggregate net assets of RiverSource Disciplined Equity Fund immediately before the acquisitions were $1,879,250,294 and the combined net assets immediately after the acquisitions were $4,385,060,209. The mergers were accomplished by tax-free exchanges of 729,934,986 shares of RiverSource Large Cap Equity Fund valued at $2,406,154,730 and 14,681,342 shares of Seligman Common Stock Fund valued at $99,655,185. - -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 51 NOTES TO FINANCIAL STATEMENTS (continued) -------------------------------------- In exchange for the RiverSource Large Cap Equity Fund shares and net assets, RiverSource Disciplined Equity Fund issued the following number of shares:
SHARES - -------------------------------------------------------------- Class A.......................................... 461,367,825 Class B.......................................... 45,802,954 Class C.......................................... 3,041,958 Class I.......................................... 8,392,835 Class R2......................................... 613 Class R3......................................... 612 Class R4......................................... 15,915,653 Class R5......................................... 5,436,673
In exchange for the Seligman Common Stock Fund shares and net assets, RiverSource Disciplined Equity Fund issued the following number of shares:
SHARES - ------------------------------------------------------------- Class A.......................................... 20,025,200 Class B.......................................... 215,665 Class C.......................................... 1,718,238 Class R2......................................... 420,178 Class R5......................................... 3,654
For financial reporting purposes, net assets received and shares issued by RiverSource Disciplined Equity Fund were recorded at fair value; however, the cost of investments for RiverSource Large Cap Equity Fund and Seligman Common Stock Fund were carried forward to align ongoing reporting of the RiverSource Disciplined Equity Fund's realized and unrealized gains and losses with amounts distributable to shareholders for tax purposes. The components of net assets at the merger date for RiverSource Large Cap Equity Fund and Seligman Common Stock Fund were as follows:
UNDISTRIBUTED (EXCESS OF DISTRIBUTIONS UNREALIZED ACCUMULATED OVER) NET TOTAL CAPITAL APPRECIATION NET INVESTMENT NET ASSETS STOCK (DEPRECIATION) REALIZED LOSS INCOME - -------------------------------------------------------------------------------------------------- RiverSource Large Cap Equity Fund $2,406,154,730 $4,210,331,804 $145,768,264 $(1,949,209,843) $(735,495) Seligman Common Stock Fund $ 99,655,185 $ 191,584,231 $ (3,070,580) $ (88,951,289) $ 92,823
The financial statements reflect the operations of the RiverSource Disciplined Equity Fund for the period prior to the mergers and the combined fund for the period subsequent to the mergers. Because the combined investment portfolios - -------------------------------------------------------------------------------- 52 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT - -------------------------------------------------------------------------------- have been managed as a single integrated portfolio since the mergers were completed, it is not practicable to separate the amounts of revenue and earnings of RiverSource Large Cap Equity Fund and Seligman Common Stock Fund that have been included in the combined Fund's Statement of Operations since the mergers were completed. Assuming the mergers had been completed on Aug. 1, 2009, the RiverSource Disciplined Equity Fund's pro-forma net investment income, net loss on investments, and net increase in net assets from operations for the six months ended Jan. 31, 2010 would have been $97,000, $62.5 million and $410.6 million, respectively. 11. LEHMAN BROTHERS HOLDINGS INC. EQUITY-LINKED NOTES At Jan. 31, 2010, the Fund held two Lehman Brothers Holdings Inc. (Lehman Brothers) equity-linked notes that went into default as of their respective maturity dates, Sept. 14, 2008 and Oct. 2, 2008, each with a principal amount of $1,275,000. Lehman Brothers filed a Chapter 11 bankruptcy petition on Sept. 15, 2008. It is likely that the Fund will receive less than the maturity value of the notes (amounting to $1,794,308) pending the outcome of the bankruptcy proceedings. These holdings have been determined to be illiquid. The notes are being valued by the Investment Manager at an estimate of the amount recoverable based on the maturity value of the notes discounted by the observable price of Lehman Brothers senior notes. At Jan. 31, 2010, the aggregate value of the notes was $394,748 which represented 0.01% of the Fund's net assets. 12. FEDERAL TAX INFORMATION Net investment income (loss) and net realized gains (losses) may differ for financial statement and tax purposes primarily because of futures contracts, re- characterization of real estate investment trust (REIT) distributions, post- October losses and losses deferred due to wash sales. The character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. Also, due to the timing of dividend distributions, the fiscal year in which amounts are distributed may differ from the year that the income or realized gains (losses) were recorded by the Fund. For federal income tax purposes, the Fund had a capital loss carry-over of $63,499,369 at July 31, 2009, that if not offset by capital gains will expire in 2017. Because the measurement periods for a regulated investment company's income are different for excise tax purposes versus income tax purposes, special rules are - -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 53 NOTES TO FINANCIAL STATEMENTS (continued) -------------------------------------- in place to protect the amount of earnings and profits needed to support excise tax distributions. As a result, the Fund is permitted to treat net capital losses realized between Nov. 1, 2008 and its fiscal year end (post-October loss) as occurring on the first day of the following tax year. At July 31, 2009, the Fund had a post-October loss of $641,152,469 that is treated for income tax purposes as occurring on Aug. 1, 2009. It is unlikely the Board will authorize a distribution of any net realized capital gains until the available capital loss carry-over has been offset or expires. There is no assurance that the Fund will be able to utilize all of its capital loss carry-over before it expires. 13. SUBSEQUENT EVENTS Management has evaluated Fund related events and transactions that occurred during the period from the date of the Statement of Assets and Liabilities through the date of issuance of the Fund's financial statements. There were no events or transactions that occurred during the period that materially impacted the amounts or disclosures in the Fund's financial statements. 14. INFORMATION REGARDING PENDING AND SETTLED LEGAL PROCEEDINGS In June 2004, an action captioned John E. Gallus et al. v. American Express Financial Corp. and American Express Financial Advisors Inc. was filed in the United States District Court for the District of Arizona. The plaintiffs allege that they are investors in several American Express Company (now known as RiverSource) mutual funds and they purport to bring the action derivatively on behalf of those funds under the Investment Company Act of 1940. The plaintiffs allege that fees allegedly paid to the defendants by the funds for investment advisory and administrative services are excessive. The plaintiffs seek remedies including restitution and rescission of investment advisory and distribution agreements. The plaintiffs voluntarily agreed to transfer this case to the United States District Court for the District of Minnesota (the District Court). In response to defendants' motion to dismiss the complaint, the District Court dismissed one of plaintiffs' four claims and granted plaintiffs limited discovery. Defendants moved for summary judgment in April 2007. Summary judgment was granted in the defendants' favor on July 9, 2007. The plaintiffs filed a notice of appeal with the Eighth Circuit Court of Appeals (the Eighth Circuit) on August 8, 2007. On April 8, 2009, the Eighth Circuit reversed summary judgment and remanded to the District Court for further proceedings. On August 6, 2009, defendants filed a writ of certiorari with the U.S. Supreme Court, asking the U.S. Supreme Court to stay the District Court proceedings while the U.S. Supreme Court considers and rules in a case captioned - -------------------------------------------------------------------------------- 54 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT - -------------------------------------------------------------------------------- Jones v. Harris Associates, which involves issues of law similar to those presented in the Gallus case. In December 2005, without admitting or denying the allegations, American Express Financial Corporation (AEFC, which is now known as Ameriprise Financial, Inc. (Ameriprise Financial)), entered into settlement agreements with the Securities and Exchange Commission (SEC) and Minnesota Department of Commerce (MDOC) related to market timing activities. As a result, AEFC was censured and ordered to cease and desist from committing or causing any violations of certain provisions of the Investment Advisers Act of 1940, the Investment Company Act of 1940, and various Minnesota laws. AEFC agreed to pay disgorgement of $10 million and civil money penalties of $7 million. AEFC also agreed to retain an independent distribution consultant to assist in developing a plan for distribution of all disgorgement and civil penalties ordered by the SEC in accordance with various undertakings detailed at http://www.sec.gov/litigation/admin/ia-2451.pdf. Ameriprise Financial and its affiliates have cooperated with the SEC and the MDOC in these legal proceedings, and have made regular reports to the RiverSource Funds' Boards of Directors/Trustees. On November 7, 2008, RiverSource Investments, LLC, a subsidiary of Ameriprise Financial, Inc., acquired J. & W. Seligman & Co. Incorporated (Seligman). In late 2003, Seligman conducted an extensive internal review concerning mutual fund trading practices. Seligman's review, which covered the period 2001-2003, noted one arrangement that permitted frequent trading in certain open-end registered investment companies managed by Seligman (the Seligman Funds); this arrangement was in the process of being closed down by Seligman before September 2003. Seligman identified three other arrangements that permitted frequent trading, all of which had been terminated by September 2002. In January 2004, Seligman, on a voluntary basis, publicly disclosed these four arrangements to its clients and to shareholders of the Seligman Funds. Seligman also provided information concerning mutual fund trading practices to the SEC and the Office of the Attorney General of the State of New York (NYAG). In September 2006, the NYAG commenced a civil action in New York State Supreme Court against Seligman, Seligman Advisors, Inc. (now known as RiverSource Fund Distributors, Inc.), Seligman Data Corp. and Brian T. Zino (collectively, the Seligman Parties), alleging, in substance, that the Seligman Parties permitted various persons to engage in frequent trading and, as a result, the prospectus disclosure used by the registered investment companies then managed by Seligman was and had been misleading. The NYAG included other related claims and also claimed that the fees charged by Seligman to the - -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 55 NOTES TO FINANCIAL STATEMENTS (continued) -------------------------------------- Seligman Funds were excessive. On March 13, 2009, without admitting or denying any violations of law or wrongdoing, the Seligman Parties entered into a stipulation of settlement with the NYAG and settled the claims made by the NYAG. Under the terms of the settlement, Seligman paid $11.3 million to four Seligman Funds. This settlement resolved all outstanding matters between the Seligman Parties and the NYAG. In addition to the foregoing matter, the New York staff of the SEC indicated in September 2005 that it was considering recommending to the Commissioners of the SEC the instituting of a formal action against Seligman and Seligman Advisors, Inc. relating to frequent trading in the Seligman Funds. Seligman responded to the staff in October 2005 that it believed that any action would be both inappropriate and unnecessary, especially in light of the fact that Seligman had previously resolved the underlying issue with the Independent Directors of the Seligman Funds and made recompense to the affected Seligman Funds. There have been no further developments with the SEC on this matter. Ameriprise Financial and certain of its affiliates have historically been involved in a number of legal, arbitration and regulatory proceedings, including routine litigation, class actions, and governmental actions, concerning matters arising in connection with the conduct of their business activities. Ameriprise Financial believes that the Funds are not currently the subject of, and that neither Ameriprise Financial nor any of its affiliates are the subject of, any pending legal, arbitration or regulatory proceedings that are likely to have a material adverse effect on the Funds or the ability of Ameriprise Financial or its affiliates to perform under their contracts with the Funds. Ameriprise Financial is required to make 10-Q, 10-K and, as necessary, 8-K filings with the Securities and Exchange Commission on legal and regulatory matters that relate to Ameriprise Financial and its affiliates. Copies of these filings may be obtained by accessing the SEC website at www.sec.gov. There can be no assurance that these matters, or the adverse publicity associated with them, will not result in increased fund redemptions, reduced sale of fund shares or other adverse consequences to the Funds. Further, although we believe proceedings are not likely to have a material adverse effect on the Funds or the ability of Ameriprise Financial or its affiliates to perform under their contracts with the Funds, these proceedings are subject to uncertainties and, as such, we are unable to estimate the possible loss or range of loss that may result. An adverse outcome in one or more of these proceedings could result in adverse judgments, settlements, fines, penalties or other relief that could have a material adverse effect on the consolidated financial condition or results of operations of Ameriprise Financial. - -------------------------------------------------------------------------------- 56 RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT PROXY VOTING ------------------------------------------------------------------- The policy of the Board is to vote the proxies of the companies in which the Fund holds investments consistent with the procedures as stated in the Statement of Additional Information (SAI). You may obtain a copy of the SAI without charge by calling the RiverSource Family of Funds at 1(800) 221-2450; contacting your financial intermediary; visiting riversource.com/funds; or searching the website of the Securities and Exchange Commission (SEC) at http://www.sec.gov. Information regarding how the Fund voted proxies relating to portfolio securities is filed with the SEC by August 31 for the most recent 12-month period ending June 30 of that year, and is available without charge by visiting riversource.com/funds; or searching the website of the SEC at www.sec.gov. - -------------------------------------------------------------------------------- RIVERSOURCE DISCIPLINED EQUITY FUND -- 2010 SEMIANNUAL REPORT 57 RIVERSOURCE DISCIPLINED EQUITY FUND 734 Ameriprise Financial Center Minneapolis, MN 55474 RIVERSOURCE.COM/FUNDS This report must be accompanied or preceded by the Fund's current prospectus. RiverSource(R) mutual funds are distributed by RiverSource Fund Distributors, Inc., Member FINRA, and managed by RiverSource Investments, LLC. RiverSource is part of Ameriprise Financial, Inc. (RIVERSOURCE INVESTMENTS LOGO) (C)2010 RiverSource Investments, LLC. S-6274 H (4/10)
Item 2. Code of Ethics. Not applicable for semi-annual reports. Item 3. Audit Committee Financial Expert. Not applicable for semi-annual reports. Item 4. Principal Accountant Fees and Services. Not applicable for semi-annual reports. Item 5. Audit Committee of Listed Registrants. Not applicable. Item 6. Investments. (a) The complete schedule of investments is included in Item 1 of this Form N-CSR. (b) Not applicable. Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. Not applicable. Item 8. Portfolio Managers of Closed-End Management Investment Companies. Not applicable. Item 9. Purchase of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers. Not applicable. Item 10. Submission of matters to a vote of security holders. Not applicable. Item 11. Controls and Procedures. (a) Based upon their evaluation of the registrant's disclosure controls and procedures as conducted within 90 days of the filing date of this Form N-CSR, the registrant's Principal Financial Officer and Principal Executive Officer have concluded that those disclosure controls and procedures provide reasonable assurance that the material information required to be disclosed by the registrant on this report is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms. (b) There were no changes in the registrant's internal controls over financial reporting that occurred during the registrant's last 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. Item 12. Exhibits. (a)(1) Not applicable for semi-annual reports. (a)(2) Separate certification for the Registrant's principal executive officer and principal financial officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002 and Rule 30a-2(a) under the Investment Company Act of 1940, are attached as EX.99.CERT. (a)(3) Not applicable. (b) A certification by the Registrant's principal executive officer and principal financial officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and Rule 30a-2(b) under the Investment Company Act of 1940, is attached as EX.99.906 CERT. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. (Registrant) RiverSource Large Cap Series, Inc. By /s/ Patrick T. Bannigan ----------------------------------------- Patrick T. Bannigan President and Principal Executive Officer Date April 6, 2010 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/ Patrick T. Bannigan ----------------------------------------- Patrick T. Bannigan President and Principal Executive Officer Date April 6, 2010 By /s/ Jeffrey P. Fox ----------------------------------------- Jeffrey P. Fox Treasurer and Principal Financial Officer Date April 6, 2010 EX-99.CERT 2 c56465exv99wcert.txt EX-99.CERT Certification Pursuant to 270.30a-2 of the Investment Company Act of 1940 I, Patrick T. Bannigan, certify that: 1. I have reviewed this report on Form N-CSR of RiverSource Large Cap Series, 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) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes with generally accepted accounting principles; c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of a date within 90 days prior to the filing date of this report based on such evaluation; d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying 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: March 22, 2010 /s/ Patrick T. Bannigan - ------------------------------------------------ Name: Patrick T. Bannigan Title: President and Principal Executive Officer Certification Pursuant to 270.30a-2 of the Investment Company Act of 1940 I, Jeffrey P. Fox, certify that: 1. I have reviewed this report on Form N-CSR of RiverSource Large Cap Series, 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) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes with generally accepted accounting principles; c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of a date within 90 days prior to the filing date of this report based on such evaluation; d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying 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: March 22, 2010 /s/ Jeffrey P. Fox - ------------------------------------------------ Name: Jeffrey P. Fox Title: Treasurer and Principal Financial Officer EX-99.906CERT 3 c56465exv99w906cert.txt EX-99.906CERT CERTIFICATION RIVERSOURCE LARGE CAP SERIES, INC. (the Registrant) Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 Each of the undersigned below certifies that 1. This report on Form N-CSR of the Registrant (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 operations of the Registrant. Date: March 22, 2010 /s/ Patrick T. Bannigan ----------------------------------------- Patrick T. Bannigan President and Principal Executive Officer Date: March 22, 2010 /s/ Jeffrey P. Fox ----------------------------------------- Jeffrey P. Fox Treasurer and Principal Financial Officer A SIGNED ORIGINAL OF THIS WRITTEN STATEMENT REQUIRED BY SECTION 906, OR OTHER DOCUMENT AUTHENTICATING, ACKNOWLEDGING, OR OTHERWISE ADOPTING THE SIGNATURE THAT APPEARS IN TYPED FORM WITHIN ELECTRONIC VERSION OF THIS WRITTEN STATEMENT REQUIRED BY SECTION 906, HAS BEEN PROVIDED TO THE REGISTRANT AND WILL BE RETAINED BY THE REGISTRANT AND FURNISHED TO THE SECURITIES AND EXCHANGE COMMISSION OR ITS STAFF UPON REQUEST. This certification is being furnished to the Commission solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of the Form N-CSR filed with the Commission. -----END PRIVACY-ENHANCED MESSAGE-----