N-CSRS 1 file001.txt COLUMBIA MID CAP GROWTH FUND, INC. 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: 811-04362 --------- Columbia Mid Cap Growth Fund, Inc. ---------------------------------------------------------------------- (Exact name of registrant as specified in charter) One Financial Center, Boston, Massachusetts 02111 ---------------------------------------------------------------------- (Address of principal executive offices) (Zip code) Vincent Pietropaolo, Esq. Columbia Management Group, Inc. One Financial Center Boston, MA 02111 ---------------------------------------------------------------------- (Name and address of agent for service) Registrant's telephone number, including area code: 1-617-772-3698 -------------- Date of fiscal year end: 08/31/05 -------- Date of reporting period: 02/28/05 -------- Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles. A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. Section 3507. ITEM 1. REPORTS TO STOCKHOLDERS. COLUMBIA FUNDS SEMIANNUAL REPORT FEBRUARY 28, 2005 [PHOTO OF WOMAN STANDING] COLUMBIA COMMON STOCK FUND COLUMBIA GROWTH FUND COLUMBIA INTERNATIONAL STOCK FUND COLUMBIA MID CAP GROWTH FUND COLUMBIA SMALL CAP GROWTH FUND COLUMBIA REAL ESTATE EQUITY FUND COLUMBIA TECHNOLOGY FUND COLUMBIA STRATEGIC INVESTOR FUND COLUMBIA BALANCED FUND COLUMBIA SHORT TERM BOND FUND COLUMBIA FIXED INCOME SECURITIES FUND COLUMBIA NATIONAL MUNICIPAL BOND FUND COLUMBIA OREGON MUNICIPAL BOND FUND COLUMBIA HIGH YIELD FUND COLUMBIA DAILY INCOME COMPANY TABLE OF CONTENTS ECONOMIC UPDATE ......................................... 1 COLUMBIA COMMON STOCK FUND .............................. 2 COLUMBIA GROWTH FUND .................................... 6 COLUMBIA INTERNATIONAL STOCK FUND ....................... 10 COLUMBIA MID CAP GROWTH FUND ............................ 14 COLUMBIA SMALL CAP GROWTH FUND .......................... 18 COLUMBIA REAL ESTATE EQUITY FUND ........................ 22 COLUMBIA TECHNOLOGY FUND ................................ 26 COLUMBIA STRATEGIC INVESTOR FUND ........................ 30 COLUMBIA BALANCED FUND .................................. 34 COLUMBIA SHORT TERM BOND FUND ........................... 38 COLUMBIA FIXED INCOME SECURITIES FUND ................... 42 COLUMBIA NATIONAL MUNICIPAL BOND FUND ................... 46 COLUMBIA OREGON MUNICIPAL BOND FUND ..................... 50 COLUMBIA HIGH YIELD FUND ................................ 54 COLUMBIA DAILY INCOME COMPANY ........................... 58 FINANCIAL STATEMENTS .................................... 64 COLUMBIA FUNDS .......................................... 223 IMPORTANT INFORMATION ABOUT THIS REPORT ................. 225 Economic and market conditions change frequently. There is no assurance that the trends described in this report will continue or commence. NOT FDIC MAY LOSE VALUE INSURED NO BANK GUARANTEE PRESIDENT'S MESSAGE ____________________________________________________________ Columbia Funds Dear Shareholder: [Photo of Christopher Wilson] In 2004, Columbia Funds became part of the Bank of America family, one of the largest, most respected financial institutions in the United States. As a direct result of this merger, a number of changes are in the works that we believe may offer significant benefits for our shareholders. Plans are underway to combine various Nations Funds and Columbia Funds together to form a single fund family that covers a wide range of markets, sectors and asset classes under the management of talented, seasoned investment professionals. As a result, some funds will be merged in order to eliminate redundancies and fund management teams will be aligned to maximize performance potential. You will receive more detailed information about these proposed mergers, and you will be asked to vote on certain fund changes that may affect you and your account. In this matter, your timely response will help us to implement the changes in 2005. The increased efficiencies we expect from a more streamlined offering of funds may help us reduce fees charged to the funds, because larger funds often benefit from size and scale of operations. For example, significant savings for the combined complex may result from the consolidation of certain vendor agreements. In fact, negotiations are currently underway to consolidate the transfer agency of all of our funds and to consolidate custodial services, each under a single vendor. We have reduced management fees for many funds as part of our settlement agreement (See Note 10 in the Notes to Financial Statements) with the New York Attorney General. As a result of these changes, we believe we will offer shareholders an even stronger lineup of investment options, with management expenses that continue to be competitive and fair. What will not change as we enter this next phase of consolidation is our commitment to the highest standards of performance and our dedication to superior service. Change for the good has another name: it's called improvement. It helps move us forward, and we believe that it represents progress for all our shareholders in their quest for long-term financial success. In the pages that follow, you'll find a discussion of the economic environment during the period followed by a detailed report from the fund's manager or managers on key factors that influenced performance. We hope that you will read the manager reports carefully and discuss any questions you might have with your financial advisor. As always, we thank you for choosing Columbia Funds. We appreciate your continued confidence. And, we look forward to helping you keep your long-term financial goals on target in the years to come. Sincerely, /s/ Christopher Wilson Christopher Wilson HEAD OF MUTUAL FUNDS, COLUMBIA MANAGEMENT Christopher Wilson is Head of Mutual Funds for Columbia Management, responsible for the day-to-day delivery of mutual fund services to the firm's investors. With the exception of distribution, Chris oversees all aspects of the mutual fund services operation, including treasury, investment accounting and shareholder and broker services. Chris serves as Columbia Management's liaison to the mutual fund boards of trustees. Chris joined Bank of America in August 2004. [sidebar] SUMMARY FOR THE SIX-MONTH PERIOD ENDED FEBRUARY 28, 2005 o After a weak start, stock prices bounced back in the second half of the period, helping the S&P 500 Index to a 9.99% gain. Foreign stocks did even better than US stocks, as measured by the MSCI EAFE Index, which returned 21.18% [UP ARROW] [UP ARROW] S&P 500 MSCI INDEX INDEX 9.99% 21.18% o Investment-grade bonds delivered modest gains. The Lehman Brothers Aggregate Bond Index returned 1.26%. High-yield bonds led the fixed income markets. The Merrill Lynch US High Yield, Cash Pay Only Index returned 7.32% [UP ARROW] [UP ARROW] LEHMAN MERRILL LYNCH INDEX INDEX 1.26% 7.32% The S&P 500 Index is an unmanaged index that tracks the performance of 500 widely held, large capitalization US stocks. The MSCI EAFE Index is an unmanaged market-weighted index composed of companies representative of the market structure of 21 developed market countries in Europe, Australasia and the Far East. The Lehman Brothers Aggregate Bond Index is a market value-weighted index that tracks the performance of fixed-rate, publicly placed, dollar-denominated, non-convertible investment-grade debt issues. The Merrill Lynch US High Yield, Cash Pay Only Index is an unmanaged index that tracks the performance of non-investment grade corporate bonds. ECONOMIC UPDATE ________________________________________________________________ Columbia Funds During the six-month period that began September 1, 2004, and ended February 28, 2005, the US economy grew at a healthy pace, as household spending expanded and business investment in equipment and software climbed at a double-digit pace. Fourth quarter gross domestic product (GDP) was originally estimated at 3.1%. However, it was revised to 3.8% once it was discovered that the trade gap appeared to have been overstated. In fact, nearly all sectors that contribute to US GDP were revised higher. Job growth dominated US economic news as the pace of new job creation picked up and more than two million jobs were created in 2004. Although January's payrolls came in somewhat below expectations, we expect generally solid advances in the months ahead. Consumer confidence declined early in this reporting period, but it rebounded late in 2004 in response to an improved labor market. For 2004, holiday sales were reported to be the strongest in five years as consumer confidence continued to lift spending, especially at high-end specialty stores and wholesale clubs. Outside the United States, economic growth was slower for most developed countries and higher for emerging economies. China attempted to slow the torrid pace of growth, yet its economy continued to grow at an estimated 9.5%. STOCKS PICK UP MOMENTUM After a weak start, stock market performance picked up as employment news improved and uncertainty surrounding both US and Iraqi elections was resolved. A majority of the S&P 500 Index's 9.99% return was generated in the second half of the reporting period. The market gained ground in November and December after a decisive US presidential election. In January, concerns over the Iraqi elections, the pace of interest-rate hikes by the Federal Reserve Board (the Fed) and some disappointing earnings guidance cooled the stock market's advance. However, after the Iraqi elections the stock market picked up again. Despite uneven economic results, foreign stock markets did even better than US stocks. The MSCI EAFE Index, a broad measure of stock market performance in the developed markets of Europe, Australasia and the Far East, gained 21.18%. BOND RETURNS SLIDE LATE IN THE PERIOD The US bond market delivered solid returns for most of the six-month period. As the Fed began to raise short-term interest rates, the bond market responded favorably. Yields on intermediate and long-term bonds edged lower--and prices rose until the last month of the period, when the 10-year Treasury yield rose sharply. As a result, most sectors of the bond market gave back their earlier gains. The Lehman Brothers Aggregate Bond Index returned 1.26% for the period. Municipal bonds outperformed taxable bonds, corporate bonds outperformed Treasury bonds and high-yield bonds led the fixed income markets. The Merrill Lynch US High Yield, Cash Pay Only Index returned 7.32%. A relatively strong economy helped improve credit quality and the sector's high yields attracted investors seeking income. HIGHER SHORT-TERM INTEREST RATES The Fed made good on its announced intentions to raise the federal funds rate, a key short-term rate, at a measured pace. After four one-quarter percentage point increases, the fed funds rate stood at 2.50% at the end of the period.1 The Fed indicated that it would continue to raise short-term interest rates in an effort to balance economic growth against inflationary pressures. 1 On March 22, 2005, the federal funds rate was raised to 2.75%. 1 [sidebar] PERFORMANCE OF A $10,000 INVESTMENT 03/01/95 - 02/28/05 ($) SALES CHARGE WITHOUT WITH ----------------------------------------------- Class A 23,308 21,970 ----------------------------------------------- Class B 22,887 22,887 ----------------------------------------------- Class C 22,887 22,887 ----------------------------------------------- Class D 22,875 22,647 ----------------------------------------------- Class Z 23,476 n/a Performance data quoted represents past performance and current performance may be lower or higher. Past performance is no guarantee of future results. The investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than the original cost. Please visit www.columbiafunds.com for daily and most recent month-end performance updates. PERFORMANCE INFORMATION ________________________________________________________ Columbia Common Stock Fund VALUE OF A $10,000 INVESTMENT 03/01/95 - 02/28/05 [MOUNTAIN CHART] CLASS A CLASS A SHARES WITHOUT SHARES WITH S&P 500 RUSSELL SALES CHARGE SALES CHARGE INDEX 1000 INDEX -------------- ------------ --------- ---------- 03/1995 10000 9425 10000 10000 10207 9620 10295 10257 10320 9727 10598 10530 10655 10042 11022 10934 10812 10191 11277 11224 11224 10579 11652 11653 11325 10674 11681 11740 11717 11043 12174 12224 11552 10888 12130 12168 12073 11379 12662 12710 12458 11742 12907 12903 12692 11963 13346 13320 12887 12146 13470 13493 13155 12398 13599 13615 13336 12569 13799 13822 13611 12828 14155 14153 13698 12910 14209 14169 13058 12307 13581 13486 13590 12808 13867 13853 14122 13310 14648 14631 14169 13354 15052 14955 15128 14258 16190 16058 15036 14171 15870 15798 15535 14642 16862 16735 15683 14781 16993 16799 15454 14565 16295 16043 15885 14972 17267 16911 16809 15843 18319 17993 17499 16492 19140 18738 18748 17670 20663 20271 18199 17152 19506 19314 18976 17885 20575 20372 18259 17209 19888 19712 18542 17475 20809 20568 18849 17765 21167 20985 18961 17870 21402 21141 20030 18878 22945 22648 20979 19773 24119 23789 20996 19789 24363 24034 20585 19401 23944 23515 21803 20549 24916 24385 21555 20315 24652 24093 18352 17296 21087 20491 19304 18194 22439 21870 20474 19297 24263 23598 21756 20505 25734 25058 23803 22434 27216 26654 24895 23464 28353 27606 24270 22875 27472 26731 25549 24080 28571 27755 25951 24458 29676 28915 25258 23805 28976 28290 27074 25517 30584 29733 26243 24734 29630 28826 25765 24283 29485 28555 25286 23832 28677 27770 26790 25250 30492 29636 27747 26151 31111 30398 29936 28215 32943 32231 28795 27140 31290 30913 29956 28233 30698 30829 33041 31141 33701 33638 32007 30167 32686 32517 30640 28878 32016 31675 32019 30178 32807 32483 31635 29816 32295 31944 33593 31661 34301 34308 31077 29290 32490 32716 30092 28362 32353 32323 27687 26095 29804 29369 28222 26599 29950 29724 28755 27102 31013 30702 25635 24161 28185 27838 24000 22620 26398 25989 25867 24380 28449 28076 25983 24489 28639 28267 25277 23823 27943 27628 24779 23354 27670 27250 23086 21759 25937 25590 20872 19672 23842 23420 21267 20044 24297 23907 22936 21617 26161 25748 23257 21920 26391 26024 22629 21328 26006 25693 22163 20889 25504 25182 22908 21591 26463 26217 21371 20142 24859 24715 21394 20164 24675 24497 19788 18650 22918 22689 17959 16927 21133 21010 18146 17103 21270 21119 16235 15302 18958 18851 17575 16564 20626 20418 18740 17662 21841 21612 17451 16447 20559 20389 17053 16072 20021 19896 16713 15752 19720 19587 16807 15840 19912 19791 18141 17098 21552 21388 18972 17881 22688 22607 19171 18069 22978 22906 19534 18411 23383 23361 20155 18996 23839 23836 19792 18654 23586 23592 20916 19714 24921 24975 21197 19978 25140 25275 22051 20783 26458 26485 22298 21016 26945 26989 22755 21447 27319 27361 22427 21138 26907 26989 21795 20542 26484 26500 22146 20872 26847 26882 22509 21215 27368 27366 21361 20133 26462 26405 21220 20000 26568 26535 21489 20254 26855 26869 21747 20497 27266 27302 22778 21468 28370 28470 23817 22447 29335 29501 23038 21713 28619 28757 02/2005 23308 21970 29212 29412 The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The fund's primary benchmark was changed to the Russell 1000 Index. The Russell 1000 Index is an unmanaged index that tracks the performance of 1,000 of the largest U.S. companies, based on market capitalization. The Standard & Poor's (S&P) 500 Index is an unmanaged index that tracks the performance of 500 widely held, large-capitalization U.S. stocks. Unlike the fund, indices are not investments, do not incur fees or expenses and are not professionally managed. It is not possible to invest directly in an index. Securities in the fund may not match those in an index. AVERAGE ANNUAL TOTAL RETURN AS OF 02/28/05 (%)
SHARE CLASS A B C D Z -------------------------------------------------------------------------------------------------------------- INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 10/01/91 -------------------------------------------------------------------------------------------------------------- SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT -------------------------------------------------------------------------------------------------------------- 6-month (cumulative) 9.86 3.54 9.51 4.51 9.51 8.51 9.45 8.45 9.99 -------------------------------------------------------------------------------------------------------------- 1-year 2.44 -3.45 1.71 -3.29 1.71 0.71 1.72 0.72 2.68 -------------------------------------------------------------------------------------------------------------- 5-year -4.90 -6.02 -5.25 -5.58 -5.25 -5.25 -5.26 -5.44 -4.76 -------------------------------------------------------------------------------------------------------------- 10-year 8.83 8.19 8.63 8.63 8.63 8.63 8.63 8.52 8.91
AVERAGE ANNUAL TOTAL RETURN AS OF 12/31/04 (%)
SHARE CLASS A B C D Z -------------------------------------------------------------------------------------------------------------- SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT -------------------------------------------------------------------------------------------------------------- 6-month (cumulative) 5.81 -0.27 5.42 0.42 5.42 4.42 5.42 4.42 5.95 -------------------------------------------------------------------------------------------------------------- 1-year 8.01 1.80 7.23 2.23 7.17 6.17 7.17 6.17 8.26 -------------------------------------------------------------------------------------------------------------- 5-year -4.48 -5.60 -4.80 -5.14 -4.80 -4.80 -4.81 -5.00 -4.34 -------------------------------------------------------------------------------------------------------------- 10-year 9.60 8.96 9.41 9.41 9.41 9.41 9.41 9.30 9.68
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF 5.75% FOR CLASS A SHARES, MAXIMUM CONTINGENT DEFERRED SALES CHARGE OF 5.00% FOR CLASS B SHARES AND 1.00% FOR CLASS C AND D SHARES FOR THE FIRST YEAR ONLY. THE "WITHOUT SALES CHARGE" RETURNS DO NOT INCLUDE THE EFFECT OF SALES CHARGES. IF THEY HAD, RETURNS WOULD BE LOWER. ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS. CLASS Z SHARES ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT SHARE CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES ASSOCIATED WITH EACH CLASS. Effective October 13, 2003, class D shares were closed to all new investors and new accounts. Existing class D shareholders will be able to make additional purchases at any time. In addition, the class D initial sales charge of 1.00% is waived after October 13, 2003. Performance results reflect any voluntary waivers or reimbursement of fund expenses by the advisor or its affiliates. Absent these waivers or reimbursement arrangements, performance results would have been lower. Classes A, B and D (newer class shares) share performance information includes returns of the fund's class Z shares (the oldest existing fund class) for periods prior to the inception of the newer class shares. The returns for class C include the returns of class B prior to 10/13/03, the date on which class C was initially offered by the fund. The returns shown for class C also include the performance of class Z prior to the inception of class B (11/01/02). Class Z share returns are not restated to reflect any expense differential (e.g., Rule 12b-1 fees) between class Z shares and the newer class shares. Had the expense differential been reflected, the returns for the periods prior to the inception of classes A, B, C and D would have been lower. 2 [sidebar] ESTIMATING YOUR ACTUAL EXPENSES To estimate the expenses that you paid over the period, first you will need your account balance at the end of the period: o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611 o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE 1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6 2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD," LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1. YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING THE PERIOD UNDERSTANDING YOUR EXPENSES ____________________________________________________ Columbia Common Stock Fund As a fund shareholder, you incur two types of costs. There are transaction costs, which generally include sales charges on purchases and may include redemption or exchange fees. There are also ongoing costs, which generally include investment advisory fees, Rule 12b-1 fees, and other fund expenses. The information on this page is intended to help you understand your ongoing costs of investing in the fund and to compare these costs with the ongoing costs of investing in other mutual funds. ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS To illustrate these ongoing costs, we have provided an example and calculated the expenses paid by investors in each share class during the reporting period. The information in the following table is based on an initial investment of $1,000, which is invested at the beginning of the reporting period and held for the entire period. Expense information is calculated two ways and each method provides you with different information. The amount listed in the "actual" column is calculated using the fund's actual operating expenses and total return for the period. The amount listed in the "hypothetical" column for each share class assumes that the return each year is 5% before expenses and includes the fund's actual expense ratio. You should not use the hypothetical account values and expenses to estimate either your actual account balance at the end of the period or the expenses you paid during this reporting period. 09/01/04 - 02/28/05
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%) ------------------------------------------------------------------------------------------------------------------------ ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ------------------------------------------------------------------------------------------------------------------------ Class A 1,000.00 1,000.00 1,098.58 1,018.74 6.35 6.11 1.22 ------------------------------------------------------------------------------------------------------------------------ Class B 1,000.00 1,000.00 1,095.11 1,015.03 10.23 9.84 1.97 ------------------------------------------------------------------------------------------------------------------------ Class C 1,000.00 1,000.00 1,095.11 1,015.03 10.23 9.84 1.97 ------------------------------------------------------------------------------------------------------------------------ Class D 1,000.00 1,000.00 1,094.52 1,015.03 10.23 9.84 1.97 ------------------------------------------------------------------------------------------------------------------------ Class Z 1,000.00 1,000.00 1,099.92 1,019.98 5.05 4.86 0.97
Expenses paid during the period are equal to the fund's annualized expense ratio, multiplied by the average account value over the period, then multiplied by the number of days in the fund's most recent fiscal half-year and divided by 365. It is important to note that the expense amounts shown in the table are meant to highlight only ongoing costs of investing in the fund and do not reflect any transactional costs, such as sales charges, redemption or exchange fees. Therefore, the hypothetical examples provided may not help you determine the relative total costs of owning shares of different funds. If these transactional costs were included, your costs would have been higher. COMPARE WITH OTHER FUNDS Since all mutual fund companies are required to include the same hypothetical calculations about expenses in shareholder reports, you can use this information to compare the ongoing cost of investing in the fund with other funds. To do so, compare the 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds. As you compare hypothetical examples of other funds, it is important to note that hypothetical examples are meant to highlight the continuing cost of investing in a fund and do not reflect any transactional costs, such as sales charges or redemption or exchange fees. 3 [sidebar] SUMMARY o FOR THE SIX-MONTH PERIOD ENDED FEBRUARY 28, 2005, THE FUND'S CLASS A SHARES RETURNED 9.86% WITHOUT SALES CHARGE. o THE FUND'S RETURN FELL SLIGHTLY SHORT OF THE RETURN OF THE S&P 500 INDEX. HOWEVER IT OUTPACED THE AVERAGE RETURN OF THE LIPPER LARGE CAP CORE FUNDS CATEGORY. o INVESTMENTS IN CONSUMER DISCRETIONARY, ENERGY, INFORMATION TECHNOLOGY AND HEALTH CARE WERE LEADING CONTRIBUTORS TO PERFORMANCE. [UP ARROW] [UP ARROW] CLASS A SHARES RUSSELL 1000 INDEX 9.86% 10.82% OBJECTIVE Seeks capital appreciation by investing primarily in common stocks of large capitalization, well-established companies. TOTAL NET ASSETS $228.0 million NET ASSET VALUE PER SHARE AS OF 02/28/05 ($) Class A 19.78 ----------------------------------------------- Class B 19.58 ----------------------------------------------- Class C 19.58 ----------------------------------------------- Class D 19.57 ----------------------------------------------- Class Z 19.78 DISTRIBUTIONS DECLARED PER SHARE 09/01/04 - 02/28/05 ($) Class A 0.10 ----------------------------------------------- Class B 0.00 ----------------------------------------------- Class C 0.00 ----------------------------------------------- Class D 0.00 ----------------------------------------------- Class Z 0.15 PORTFOLIO MANAGERS' REPORT _____________________________________________________ Columbia Common Stock Fund For the six-month period ended February 28, 2005, Columbia Common Stock Fund class A shares returned 9.86% without sales charge. This performance trailed both the Russell 1000 Index's return of 10.82% and the S&P 500 Index, which returned 9.99% over the same period. The fund outperformed the average return of its peer group, the Lipper Large Cap Core Funds Category, which was 9.27%. 1 Stock selection--particularly in the health care, energy, telecom services and consumer staples areas--helped the fund. By contrast, sector weights detracted from relative performance. Overall, holdings in consumer discretionary, energy, information technology and health care groups were the largest contributors to the fund's return. ENERGY STOCKS SURGE; CONSUMER DISCRETIONARY AND HEALTH CARE OUTPERFORM Although several sectors produced double-digit returns during the period, energy stocks stood out. The fund had less exposure to energy than the index because we believed that the stocks were overvalued and could decline. This underweight in energy detracted from the fund's relative performance during the period. Yet, its energy holdings surged more than 39% as oil prices rose. The fund benefited from its holdings in consumer discretionary and health care sectors, which outperformed both indices. Investments in selected pharmaceutical companies were strong despite a setback for Pfizer, whose stock suffered when concerns surfaced about the safety of COX-2 inhibitors. ACQUISITIONS BOLSTERED PERFORMANCE During the period, the fund owned shares in several companies whose underlying attributes made them attractive as takeover candidates. For example, we were drawn to Sears Roebuck because we thought the company had substantial unrealized asset value--a marketable credit card portfolio and real estate. When shares soared after K-Mart announced plans to acquire the company, we took profits and eliminated the stock from the fund. We used the proceeds to invest in May Department Stores, which enjoyed gains that were spurred by take-over announcements. Another takeover target, International Steel Group, also gained ground. CONTRARIAN APPROACH ADDED VALUE When new management took over the fund in August, 2004, we adopted a more contrarian approach to stock selection, seeking companies that appeared to offer opportunity because they were generally out of favor with investors or, by contrast, avoiding companies because investors had become overly enthusiastic about their prospects. One case in point was 1 Lipper Inc., a widely respected data provider in the industry, calculates an average total return for mutual funds with similar investment objectives as those of the fund. 4 [sidebar] TOP 5 SECTORS AS OF 02/28/05 (%) Consumer discretionary 19.6 ----------------------------------------------- Information technology 19.5 ----------------------------------------------- Financials 16.4 ----------------------------------------------- Health care 11.7 ----------------------------------------------- Materials 9.2 TOP 10 HOLDINGS AS OF 02/28/05 (%) MGIC Investment 2.5 ----------------------------------------------- E.I. du Pont de Nemours 2.3 ----------------------------------------------- Microsoft 2.3 ----------------------------------------------- SanDisk 2.3 ----------------------------------------------- Barr Pharmaceuticals 2.2 ----------------------------------------------- UnumProvident 2.1 ----------------------------------------------- Time Warner 2.1 ----------------------------------------------- Comcast 2.0 ----------------------------------------------- Intel 2.0 ----------------------------------------------- Smurfit-Stone Container 2.0 HOLDINGS DISCUSSED IN THIS REPORT AS OF 02/28/05 (%) Pfizer 1.1 ----------------------------------------------- May Department Stores 1.0 ----------------------------------------------- International Steel Group 1.5 ----------------------------------------------- Jacobs Engineering Group 0.7 ----------------------------------------------- Nortel Networks 1.2 Your fund is actively managed and the composition of its portfolio will change over time. Information provided is calculated as a percentage of net assets. ________________________________________________________________________________ Columbia Common Stock Fund Jacobs Engineering Group. The company fell out of favor after some operational snags, but we believed it had the potential to get back on track. We also believed the company was poised to benefit from the robust commercial construction activity. The company delivered on both fronts and it was one of the fund's best performers for the period. Similarly, we added to semiconductor holdings after the information technology group had been severely punished. We felt that weakness in these stocks primarily reflected inventory corrections in the industry. With capacity utilization rates at 85%, good global economic growth and rising demand, semiconductor stocks rose and helped the fund's return. In contrast, news that insurance broker Marsh McLennan and technology company Nortel Networks were caught up in accounting issues sent their shares down sharply. We exited the fund's position in Marsh McLennan because we were troubled by the lack of clarity about the scope of a regulatory investigation and its possible effect on profitability. We decided to hold onto Nortel Networks after the company changed management and took steps to resolve its accounting problems. ENVIRONMENT FAVORS NIMBLE STOCK PICKING Looking ahead, we expect slower economic growth, rising interest rates and emerging cost pressure to set the tone for investors. In this scenario, we believe that avoiding losing stocks is likely to be as important as finding winners. If rising rates and cost pressures are passed on to consumers, consumer staples companies could be especially vulnerable because they have the least pricing power. We also think slower growth in a fundamentally sound economy means that acquisition activity is likely to exert significant influence on performance in 2005. We have positioned the fund to take advantage of both key factors. Columbia Common Stock Fund is managed by a group of managers from Columbia's large cap core team: /s/ John Maack /s/ Guy W. Pope John Maack Guy W. Pope, CFA On October 13, 2004, the Board of Trustees approved a proposal to reorganize the Columbia Common Stock Fund into Columbia Large Cap Core Fund, subject to shareholder approval and the satisfaction of certain other conditions. Shareholders approved the merger at a shareholder meeting held on March 11, 2005. The merger was completed at the close of business on March 18, 2005. Equity investments are affected by stock market fluctuations that occur in response to economic and business developments. 5 [sidebar] PERFORMANCE OF A $10,000 INVESTMENT 03/01/95 - 02/28/05 ($) SALES CHARGE WITHOUT WITH ----------------------------------------------- Class A 20,385 19,215 ----------------------------------------------- Class B 20,045 20,045 ----------------------------------------------- Class C 19,993 19,993 ----------------------------------------------- Class D 20,059 19,861 ----------------------------------------------- Class G 20,077 20,077 ----------------------------------------------- Class Z 20,540 n/a Performance data quoted represents past performance and current performance may be lower or higher. Past performance is no guarantee of future results. The investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than the original cost. Please visit www.columbiafunds.com for daily and most recent month-end performance updates. PERFORMANCE INFORMATION ________________________________________________________ Columbia Growth Fund VALUE OF A $10,000 INVESTMENT 03/01/95 - 02/28/05 [MOUNTAIN CHART] CLASS A CLASS A RUSSELL SHARES WITHOUT SHARES WITH S&P 500 1000 SALES CHARGE SALES CHARGE INDEX GROWTH INDEX -------------- ------------ --------- ------------ 03/1995 10000 9425 10000 10000 10360 9764 10295 10292 10505 9901 10598 10517 10742 10125 11022 10883 11149 10507 11277 11303 11589 10923 11652 11774 11792 11114 11681 11787 12102 11406 12174 12330 11792 11114 12130 12339 12528 11807 12662 12819 12652 11924 12907 12892 12783 12048 13346 13322 13369 12600 13470 13566 13322 12556 13599 13584 13763 12972 13799 13941 14162 13348 14155 14428 14158 13344 14209 14448 13098 12344 13581 13601 13543 12764 13867 13952 14335 13511 14648 14968 14589 13750 15052 15058 15479 14589 16190 16188 15282 14403 15870 15871 15819 14909 16862 16984 15833 14922 16993 16868 15027 14163 16295 15956 15772 14865 17267 17015 16846 15878 18319 18243 17547 16538 19140 18973 19104 18005 20663 20650 18402 17344 19506 19442 19133 18033 20575 20399 18651 17578 19888 19644 19168 18065 20809 20479 19302 18192 21167 20708 19819 18679 21402 21328 21276 20052 22945 22931 22282 21001 24119 23846 22349 21064 24363 24176 21810 20556 23944 23489 23464 22114 24916 24926 23121 21791 24652 24762 19315 18205 21087 21045 20036 18884 22439 22661 21160 19943 24263 24483 22554 21257 25734 26347 25164 23717 27216 28723 26749 25211 28353 30409 25861 24374 27472 29019 27431 25853 28571 30549 27483 25902 29676 30588 26796 25255 28976 29649 28827 27169 30584 31725 27821 26221 29630 30716 27058 25503 29485 31217 26555 25028 28677 30561 28042 26430 30492 32868 29391 27701 31111 34643 31713 29889 32943 38246 30632 28870 31290 36453 32368 30507 30698 38235 35799 33741 33701 40973 34339 32364 32686 39022 32172 30322 32016 37056 35026 33012 32807 39864 34837 32833 32295 38202 37644 35480 34301 41659 34350 32375 32490 37718 32313 30455 32353 35934 28481 26843 29804 30638 29193 27515 29950 29669 30848 29075 31013 31720 25931 24440 28185 26334 23105 21776 26398 23469 25997 24503 28449 26437 25719 24240 28639 26049 25159 23712 27943 25444 24079 22695 27670 24808 22004 20738 25937 22779 19621 18492 23842 20506 20727 19535 24297 21582 22897 21581 26161 23656 22945 21626 26391 23611 22002 20737 26006 23193 20838 19640 25504 22231 21637 20392 26463 23000 19828 18688 24859 21123 19594 18467 24675 20612 17640 16626 22918 18705 15942 15025 21133 17677 16184 15253 21270 17730 14530 13694 18958 15891 15752 14846 20626 17348 16454 15508 21841 18290 15247 14370 20559 17026 14910 14052 20021 16613 14822 13969 19720 16536 15063 14197 19912 16844 16220 15287 21552 18089 17010 16032 22688 18991 17178 16191 22978 19253 17551 16542 23383 19733 18013 16977 23839 20224 17573 16563 23586 20008 18533 17467 24921 21132 18766 17687 25140 21354 19205 18101 26458 22093 19549 18425 26945 22544 19674 18543 27319 22688 19491 18371 26907 22266 18942 17853 26484 22008 19447 18329 26847 22417 19762 18626 27368 22697 18496 17432 26462 21415 18246 17197 26568 21310 18620 17549 26855 21512 18987 17895 27266 21848 19887 18743 28370 22599 20702 19512 29335 23485 20203 19042 28619 22703 02/2005 20385 19215 29212 22945 The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The Standard & Poor's (S&P) 500 Index is an unmanaged index that tracks the performance of 500 widely held, large-capitalization U.S. stocks. The Russell 1000 Growth Index is an unmanaged index that measures the performance of those Russell 1000 Index companies with higher price-to-book ratios and higher forecasted growth values. Unlike the fund, indices are not investments, do not incur fees or expenses and are not professionally managed. It is not possible to invest directly in an index. Securities in the fund may not match those in an index. AVERAGE ANNUAL TOTAL RETURN AS OF 02/28/05 (%)
SHARE CLASS A B C D G Z --------------------------------------------------------------------------------------------------------------------------------- INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 11/01/02 06/16/67 --------------------------------------------------------------------------------------------------------------------------------- SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT --------------------------------------------------------------------------------------------------------------------------------- 6-month (cumulative) 11.73 5.30 11.33 6.33 11.32 10.32 11.32 10.32 11.33 6.33 11.86 --------------------------------------------------------------------------------------------------------------------------------- 1-year 3.62 -2.34 2.92 -2.08 2.89 1.89 2.88 1.88 2.93 -2.07 3.91 --------------------------------------------------------------------------------------------------------------------------------- 5-year -8.83 -9.90 -9.14 -9.46 -9.18 -9.18 -9.12 -9.30 -9.11 -9.59 -8.69 --------------------------------------------------------------------------------------------------------------------------------- 10-year 7.38 6.75 7.20 7.20 7.17 7.17 7.21 7.10 7.22 7.22 7.46
AVERAGE ANNUAL TOTAL RETURN AS OF 12/31/04 (%)
SHARE CLASS A B C D G Z --------------------------------------------------------------------------------------------------------------------------------- SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT --------------------------------------------------------------------------------------------------------------------------------- 6-month (cumulative) 4.76 -1.27 4.38 -0.62 4.39 3.39 4.38 3.38 4.39 -0.61 4.88 --------------------------------------------------------------------------------------------------------------------------------- 1-year 7.79 1.59 6.99 1.99 6.96 5.96 6.98 5.98 7.03 2.03 8.03 --------------------------------------------------------------------------------------------------------------------------------- 5-year -8.17 -9.25 -8.47 -8.79 -8.51 -8.51 -8.45 -8.64 -8.43 -8.92 -8.04 --------------------------------------------------------------------------------------------------------------------------------- 10-year 8.08 7.44 7.91 7.91 7.89 7.89 7.92 7.81 7.93 7.93 8.16
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF 5.75% FOR CLASS A SHARES, MAXIMUM CONTINGENT DEFERRED SALES CHARGE OF 5.00% FOR CLASS B AND CLASS G SHARES AND 1.00% FOR CLASS C AND D SHARES FOR THE FIRST YEAR ONLY. THE "WITHOUT SALES CHARGE" RETURNS DO NOT INCLUDE THE EFFECT OF SALES CHARGES. IF THEY HAD, RETURNS WOULD BE LOWER. ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS. CLASS Z SHARES ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT SHARE CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES ASSOCIATED WITH EACH CLASS. Effective October 13, 2003, class D shares were closed to all new investors and new accounts. Existing class D shareholders will be able to make additional purchases at any time. In addition, the class D initial sales charge of 1.00% is waived after October 13, 2003. Performance results reflect any voluntary waivers or reimbursement of fund expenses by the advisor or its affiliates. Absent these waivers or reimbursement arrangements, performance results would have been lower. Classes A, B, D and G (newer class shares) share performance information includes returns of the fund's class Z shares (the oldest existing fund class) for periods prior to the inception of the newer class shares. The returns for class C include the returns of class B prior to 10/13/03, the date on which class C was initially offered by the fund. The returns shown for class C also include the performance of class Z prior to the inception of class B (11/01/02). Class Z share returns are not restated to reflect any expense differential (e.g., Rule 12b-1 fees) between class Z shares and the newer class shares. Had the expense differential been reflected, the returns for the periods prior to the inception of classes A, B, C, D and G would have been lower. 6 [sidebar] ESTIMATING YOUR ACTUAL EXPENSES To estimate the expenses that you paid over the period, first you will need your account balance at the end of the period: o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611 o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE 1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6 2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD," LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1. YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING THE PERIOD UNDERSTANDING YOUR EXPENSES ____________________________________________________ Columbia Growth Fund As a fund shareholder, you incur two types of costs. There are transaction costs, which generally include sales charges on purchases and may include redemption or exchange fees. There are also ongoing costs, which generally include investment advisory fees, Rule 12b-1 fees, and other fund expenses. The information on this page is intended to help you understand your ongoing costs of investing in the fund and to compare these costs with the ongoing costs of investing in other mutual funds. ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS To illustrate these ongoing costs, we have provided an example and calculated the expenses paid by investors in each share class during the reporting period. The information in the following table is based on an initial investment of $1,000, which is invested at the beginning of the reporting period and held for the entire period. Expense information is calculated two ways and each method provides you with different information. The amount listed in the "actual" column is calculated using the fund's actual operating expenses and total return for the period. The amount listed in the "hypothetical" column for each share class assumes that the return each year is 5% before expenses and includes the fund's actual expense ratio. You should not use the hypothetical account values and expenses to estimate either your actual account balance at the end of the period or the expenses you paid during this reporting period. 09/01/04 - 02/28/05
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%) ------------------------------------------------------------------------------------------------------------------------ ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ------------------------------------------------------------------------------------------------------------------------ Class A 1,000.00 1,000.00 1,117.28 1,019.29 5.83 5.56 1.11 ------------------------------------------------------------------------------------------------------------------------ Class B 1,000.00 1,000.00 1,113.31 1,015.57 9.75 9.30 1.86 ------------------------------------------------------------------------------------------------------------------------ Class C 1,000.00 1,000.00 1,113.21 1,015.57 9.75 9.30 1.86 ------------------------------------------------------------------------------------------------------------------------ Class D 1,000.00 1,000.00 1,113.21 1,015.57 9.75 9.30 1.86 ------------------------------------------------------------------------------------------------------------------------ Class G 1,000.00 1,000.00 1,113.31 1,015.82 9.48 9.05 1.81 ------------------------------------------------------------------------------------------------------------------------ Class Z 1,000.00 1,000.00 1,118.62 1,020.53 4.52 4.31 0.86
Expenses paid during the period are equal to the fund's annualized expense ratio, multiplied by the average account value over the period, then multiplied by the number of days in the fund's most recent fiscal half-year and divided by 365. It is important to note that the expense amounts shown in the table are meant to highlight only ongoing costs of investing in the fund and do not reflect any transactional costs, such as sales charges, redemption or exchange fees. Therefore, the hypothetical examples provided may not help you determine the relative total costs of owning shares of different funds. If these transactional costs were included, your costs would have been higher. COMPARE WITH OTHER FUNDS Since all mutual fund companies are required to include the same hypothetical calculations about expenses in shareholder reports, you can use this information to compare the ongoing cost of investing in the fund with other funds. To do so, compare the 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds. As you compare hypothetical examples of other funds, it is important to note that hypothetical examples are meant to highlight the continuing cost of investing in a fund and do not reflect any transactional costs, such as sales charges or redemption or exchange fees. 7 [sidebar] SUMMARY o FOR THE SIX-MONTH PERIOD ENDED FEBRUARY 28, 2005, THE FUND'S CLASS A SHARES RETURNED 11.73% WITHOUT SALES CHARGE. o THE FUND OUTPACED THE RUSSELL 1000 GROWTH INDEX AND THE S&P 500 INDEX, AS WELL AS ITS PEER GROUP AVERAGE, THE LIPPER LARGE-CAP GROWTH FUNDS CATEGORY. o THE FUND TARGETED LARGE COMPANIES WITH SOLID COMPETITIVE STANDINGS, STRONG FINANCIAL POSITIONS AND SUPERIOR SALES GROWTH. THIS STRONG STOCK SELECTION WAS A BOON TO RELATIVE PERFORMANCE. [UP ARROW] [UP ARROW] RUSSELL 1000 CLASS A SHARES GROWTH INDEX 11.73% 7.67% OBJECTIVE Seeks capital appreciation by investing in stocks of companies expected to experience long-term, above average earnings growth. TOTAL NET ASSETS $737.6 million NET ASSET VALUE PER SHARE AS OF 02/28/05 ($) Class A 27.76 ----------------------------------------------- Class B 27.36 ----------------------------------------------- Class C 27.29 ----------------------------------------------- Class D 27.38 ----------------------------------------------- Class G 27.40 ----------------------------------------------- Class Z 27.95 DISTRIBUTIONS DECLARED PER SHARE 09/01/04 - 02/28/05 ($) Class A 0.09 ----------------------------------------------- Class B 0.03 ----------------------------------------------- Class C 0.03 ----------------------------------------------- Class D 0.03 ----------------------------------------------- Class G 0.03 ----------------------------------------------- Class Z 0.12 PORTFOLIO MANAGERS' REPORT _____________________________________________________ Columbia Growth Fund For the six-month period ended February 28, 2005, Columbia Growth Fund's class A shares returned 11.73% without sales charge. Fund performance was better than both the Russell 1000 Growth Index and the S&P 500 Index, which returned 7.67% and 9.99%, respectively. The fund also outdistanced its peer group average. The average return of the Lipper Large Cap Growth Funds Category was 8.80% for the period. 1 Our focus on large-cap companies with strong competitive positions, high sustainable profits, good balance sheets and above-average sales growth resulted in strong stock selection, especially in the consumer discretionary and health care sectors. CONSUMER DISCRETIONARY AND HEALTH CARE STOCKS BENEFITED FROM STRONG DEMAND Investments in lodging and specialty retailing stocks did especially well within the consumer discretionary sector. Lodging stocks, such as Marriott International, rallied nicely as travel spending recovered after dropping off in the wake of 9/11. Demand for rooms also grew at a faster rate than supply, fueling strong pricing. Among specialty retailers, top gainers included Chico's FAS and Coach. Chico's FAS is a women's apparel store, while Coach manufactures and sells handbags and other accessories. Both stocks benefited from popular product lines, strong sales, good execution and steady new store expansion. Health care stocks also were strong contributors to performance. The fund focused on medical device and specialty product companies, while keeping a below-average stake in pharmaceuticals. This allocation worked well as drug stocks remained under pressure from patent expirations and a lack of new blockbuster products. Among the fund's best performers were Johnson & Johnson and Caremark Rx. Johnson & Johnson benefited from acquiring cardiac stent maker Guidant (this stock is not in the portfolio). Caremark Rx, a pharmacy benefits manager, saw strong demand from companies working to control rising health care costs. CONSUMER STAPLES AND INDUSTRIALS STOCKS RALLIED AS OUTLOOK IMPROVED Stock selection was also strong in the consumer staples and industrials sectors. In consumer staples, Altria Group (formerly Philip Morris) saw its stock price rise as it came closer to settling pending tobacco litigation. In industrials, Rockwell Automation benefited from strong demand as companies both in the United States and China sought to automate their manufacturing processes. Ingersoll-Rand also posted sharp gains as the company improved its product line. Although the fund's technology stocks were solid contributors to absolute performance, they had little effect on the fund's returns relative to the Russell 1000 Growth Index. Tech stocks were under pressure for much of the year, as investors worried about maturing technologies, increased competition and overstocked inventories. The sector later 1 Lipper Inc., a widely respected data provider in the industry, calculates an average total return for mutual funds with similar investment objectives as those of the fund. 8 [sidebar] TOP 5 SECTORS AS OF 02/28/05 (%) Health care 25.7 ----------------------------------------------- Information technology 23.0 ----------------------------------------------- Consumer discretionary 17.9 ----------------------------------------------- Consumer staples 12.0 ----------------------------------------------- Industrials 9.9 TOP 10 HOLDINGS AS OF 02/28/05 (%) Johnson & Johnson 4.2 ----------------------------------------------- Microsoft 3.4 ----------------------------------------------- Tyco International 2.7 ----------------------------------------------- Intel 2.3 ----------------------------------------------- International Business Machines 2.3 ----------------------------------------------- Pfizer 2.1 ----------------------------------------------- Cisco Systems 2.1 ----------------------------------------------- Dell 2.0 ----------------------------------------------- PepsiCo 2.0 ----------------------------------------------- Marriott International 2.0 HOLDINGS DISCUSSED IN THIS REPORT AS OF 02/28/05 (%) Marriott International 2.0 ----------------------------------------------- Chico's FAS 1.3 ----------------------------------------------- Coach 1.1 ----------------------------------------------- Johnson & Johnson 4.2 ----------------------------------------------- Caremark Rx 0.8 ----------------------------------------------- Altria Group 1.6 ----------------------------------------------- Rockwell Automation 1.0 ----------------------------------------------- Ingersoll-Rand 1.1 ----------------------------------------------- Cognizant Technology Solutions 0.6 ----------------------------------------------- Cisco Systems 2.1 ----------------------------------------------- Goldman Sachs Group 1.4 ----------------------------------------------- Merrill Lynch & Co. 0.6 ----------------------------------------------- American International Group 0.9 Your fund is actively managed and the composition of its portfolio will change over time. Information provided is calculated as a percentage of net assets. ________________________________________________________________________________ Columbia Growth Fund rebounded, as inventory issues began to dissipate and capital spending intentions improved. Among the fund's top performers was Cognizant Technology Solutions, a software outsourcing company with operations in India. By contrast, Cisco Systems hampered performance amid concerns that companies would be slow to ramp up spending on networking equipment. In addition, the fund's focus on financial companies with exposure to improving capital markets contributed to its strong performance. Both Goldman Sachs Group and Merrill Lynch & Co. benefited from a strong increase in merger & acquisition activity and a rising stock market. American International Group, however, was a disappointment as the whole insurance industry came under the scrutiny of government investigators. OUTLOOK REMAINS POSITIVE FOR LARGE-CAP STOCKS We expect economic and profit growth to support a favorable outlook for large-cap stocks, although both are likely to be lower than last year. If inflation remains low, as we anticipate, longer-term interest rates are also likely to remain low. We believe large-cap growth stocks have the potential to benefit further from valuations that remain attractive relative to large-cap value stocks. Alexander S. Macmillan, CFA, has managed or co-managed Columbia Growth Fund since 1992 and has been with the advisor and its predecessors or affiliate organizations since 1989. /s/ Alexander S. Macmillan Paul J. Berlinguet has co-managed the fund since October 2003 and has been with the advisor and its predecessors since 2003. /s/ Paul J. Berlinguet On October 13, 2004, the Board of Trustees approved a proposal to reorganize the Columbia Growth Fund into Columbia Large Cap Growth Fund, subject to shareholder approval and the satisfaction of certain other conditions. Shareholders approved the merger at a shareholder meeting held on March 11, 2005. The merger was completed at the close of business on March 18, 2005. Equity investments are affected by stock market fluctuations that occur in response to economic and business developments. Investing in growth stocks incurs the possibility of losses because their prices are sensitive to changes in current or expected earnings. The fund may invest in foreign securities, which have special risks, including political or economic instability and higher transaction costs; different regulations, accounting standards, trading practices and levels of information; and currency exchange rate fluctuations. 9 [sidebar] PERFORMANCE OF A $10,000 INVESTMENT 03/01/95 - 02/28/05 ($) SALES CHARGE WITHOUT WITH ----------------------------------------------- Class A 21,647 20,399 ----------------------------------------------- Class B 21,190 21,190 ----------------------------------------------- Class C 21,261 21,261 ----------------------------------------------- Class D 21,345 21,139 ----------------------------------------------- Class Z 21,904 n/a Performance data quoted represents past performance and current performance may be lower or higher. Past performance is no guarantee of future results. The investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than the original cost. Please visit www.columbiafunds.com for daily and most recent month-end performance updates. PERFORMANCE INFORMATION ________________________________________________________ Columbia International Stock Fund VALUE OF A $10,000 INVESTMENT 03/01/95 - 02/28/05 [MOUNTAIN CHART] CLASS A CLASS A SHARES WITHOUT SHARES WITH MSCI AC WORLD MSCI EAFE SALES CHARGE SALES CHARGE EX US INDEX INDEX -------------- ------------ ------------ ------------ 03/1995 10000 9425 10000 10000 10381 9784 10565 10624 10611 10001 10977 11023 10487 9884 10928 10892 10443 9843 10777 10702 11135 10494 11388 11368 10949 10319 10993 10935 11215 10570 11181 11148 11090 10453 10882 10849 11312 10662 11138 11150 11587 10921 11579 11600 11738 11063 11738 11647 11738 11063 11738 11687 12172 11472 11957 11934 12633 11907 12319 12282 12837 12098 12135 12056 13068 12316 12196 12123 12393 11681 11792 11769 12588 11864 11861 11795 12908 12165 12155 12109 12837 12099 12034 11985 13333 12567 12498 12462 13509 12733 12353 12302 13500 12724 12126 11871 13881 13083 12348 12066 14017 13211 12322 12109 14347 13522 12427 12173 15175 14303 13193 12966 15896 14982 13922 13680 16373 15432 14203 13902 15106 14237 13085 12863 16139 15211 13793 13584 15019 14155 12618 12539 14951 14092 12460 12411 15059 14193 12603 12519 15179 14307 12980 13091 15796 14888 13846 13932 16334 15395 14325 14361 16741 15779 14428 14474 16972 15996 14166 14404 17026 16047 14113 14513 17125 16141 14247 14660 14794 13944 12238 12843 14015 13209 11980 12449 15147 14276 13236 13746 16203 15271 13947 14450 16992 16015 14426 15019 17509 16502 14410 14974 17080 16098 14088 14618 17520 16513 14768 15227 18060 17021 15506 15844 17422 16421 14778 15028 18313 17260 15457 15614 19060 17964 15819 16078 19477 18357 15874 16137 19884 18741 15981 16300 20962 19757 16575 16912 23601 22244 17238 17499 26835 25292 18883 19070 25552 24083 17858 17859 27246 25679 18340 18339 26799 25258 19029 19051 24575 23162 17967 18049 22670 21367 17507 17608 23611 22253 18253 18297 22530 21234 17532 17530 23212 21878 17750 17683 21778 20526 16765 16822 20802 19606 16231 16425 19862 18720 15504 15809 20762 19568 16033 16370 20650 19462 16273 16362 19539 18415 14985 15135 18188 17143 13925 14125 19313 18202 14872 15107 19017 17924 14462 14574 18399 17341 13908 13978 17795 16772 13598 13723 17457 16454 13260 13376 15729 14825 11853 12021 16165 15235 12185 12329 16545 15593 12742 12784 16927 15954 12907 12859 16180 15250 12354 12176 16294 15357 12443 12261 17053 16072 13104 12984 17138 16153 13205 13010 17308 16313 13349 13175 16844 15875 12772 12651 15395 14510 11527 11402 15255 14378 11528 11376 13693 12906 10306 10154 14190 13374 10858 10699 14643 13801 11381 11185 14205 13388 11014 10809 13569 12788 10628 10358 13371 12602 10412 10121 13272 12509 10210 9923 14190 13374 11194 10895 14968 14107 11907 11555 15236 14360 12237 11835 15645 14746 12563 12122 16027 15106 12937 12414 16465 15518 13299 12796 17439 16437 14161 13593 17609 16596 14470 13895 18781 17701 15574 14980 19163 18061 15824 15191 19402 18286 16226 15542 19586 18460 16327 15629 19063 17967 15819 15276 18852 17768 15870 15328 19204 18100 16214 15664 18455 17394 15742 15155 18428 17368 15868 15221 18752 17674 16379 15619 19360 18246 16949 16151 20575 19392 18125 17254 21287 20063 18903 18012 20779 19584 18578 17682 02/2005 21647 20399 19494 18448 The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The Morgan Stanley Capital International (MSCI) All Country (AC) World ex US Index is an unmanaged index of global stock market performance that includes developed and emerging markets but excludes the US. The Morgan Stanley Capital International (MSCI) Europe, Australasia, Far East (EAFE) Index is a free float-adjusted market capitalization index that is designed to measure developed market equity performance, excluding the US and Canada. Unlike the fund, indices are not investments, do not incur fees or expenses and are not professionally managed. It is not possible to invest directly in an index. Securities in the fund may not match those in an index. AVERAGE ANNUAL TOTAL RETURN AS OF 02/28/05 (%)
SHARE CLASS A B C D Z ---------------------------------------------------------------------------------------------------------------- INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 10/01/92 ---------------------------------------------------------------------------------------------------------------- SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT ---------------------------------------------------------------------------------------------------------------- 6-month (cumulative) 17.51 10.75 17.10 12.10 17.03 16.03 17.04 16.04 17.61 ---------------------------------------------------------------------------------------------------------------- 1-year 11.61 5.19 10.78 5.78 10.82 9.82 10.86 9.86 11.98 ---------------------------------------------------------------------------------------------------------------- 5-year -4.50 -5.62 -4.90 -5.22 -4.84 -4.84 -4.76 -4.95 -4.27 ---------------------------------------------------------------------------------------------------------------- 10-year 8.03 7.39 7.80 7.80 7.83 7.83 7.88 7.77 8.16
AVERAGE ANNUAL TOTAL RETURN AS OF 12/31/04 (%)
---------------------------------------------------------------------------------------------------------------- SHARE CLASS A B C D Z ---------------------------------------------------------------------------------------------------------------- SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT ---------------------------------------------------------------------------------------------------------------- 6-month (cumulative) 10.84 4.47 10.47 5.47 10.43 9.43 10.47 9.47 10.98 ---------------------------------------------------------------------------------------------------------------- 1-year 13.34 6.83 12.49 7.49 12.79 11.79 12.81 11.81 13.97 ---------------------------------------------------------------------------------------------------------------- 5-year -4.53 -5.65 -4.91 -5.23 -4.84 -4.84 -4.77 -4.96 -4.30 ---------------------------------------------------------------------------------------------------------------- 10-year 6.80 6.17 6.59 6.59 6.63 6.63 6.67 6.56 6.93
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF 5.75% FOR CLASS A SHARES, MAXIMUM CONTINGENT DEFERRED SALES CHARGE OF 5.00% FOR CLASS B SHARES AND 1.00% FOR CLASS C AND D SHARES FOR THE FIRST YEAR ONLY. THE "WITHOUT SALES CHARGE" RETURNS DO NOT INCLUDE THE EFFECT OF SALES CHARGES. IF THEY HAD, RETURNS WOULD HAVE BEEN LOWER ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS. CLASS Z SHARES ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT SHARE CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES ASSOCIATED WITH EACH CLASS. Effective October 13, 2003, class D shares were closed to all new investors and new accounts. Existing class D shareholders will be able to make additional purchases at any time. In addition, the class D initial sales charge of 1.00% is waived after October 13, 2003. Performance results reflect any voluntary waivers or reimbursement of fund expenses by the advisor or its affiliates. Absent these waivers or reimbursement arrangements, performance results would have been lower. Classes A, B and D (newer class shares) share performance information includes returns of the fund's class Z shares (the oldest existing fund class) for periods prior to the inception of the newer class shares. The returns for Class C include the returns of Class B prior to 10/13/03, the date on which class C was initially offered by the fund. The returns shown for Class C also include the performance of Class Z prior to the inception of Class B (11/01/02). Class Z share returns are not restated to reflect any expense differential (e.g., Rule 12b-1 fees) between class Z shares and the newer class shares. Had the expense differential been reflected, the returns for the periods prior to the inception of classes A, B, C and D would have been lower. 10 [sidebar] ESTIMATING YOUR ACTUAL EXPENSES To estimate the expenses that you paid over the period, first you will need your account balance at the end of the period: o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611 o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE 1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6 2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD," LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1. YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING THE PERIOD UNDERSTANDING YOUR EXPENSES ____________________________________________________ Columbia International Stock Fund As a fund shareholder, you incur two types of costs. There are transaction costs, which generally include sales charges on purchases and may include redemption or exchange fees. There are also ongoing costs, which generally include investment advisory fees, Rule 12b-1 fees, and other fund expenses. The information on this page is intended to help you understand your ongoing costs of investing in the fund and to compare these costs with the ongoing costs of investing in other mutual funds. ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS To illustrate these ongoing costs, we have provided an example and calculated the expenses paid by investors in each share class during the reporting period. The information in the following table is based on an initial investment of $1,000, which is invested at the beginning of the reporting period and held for the entire period. Expense information is calculated two ways and each method provides you with different information. The amount listed in the "actual" column is calculated using the fund's actual operating expenses and total return for the period. The amount listed in the "hypothetical" column for each share class assumes that the return each year is 5% before expenses and includes the fund's actual expense ratio. You should not use the hypothetical account values and expenses to estimate either your actual account balance at the end of the period or the expenses you paid during this reporting period. 09/01/04 - 02/28/05
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%) ------------------------------------------------------------------------------------------------------------------------ ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ------------------------------------------------------------------------------------------------------------------------ Class A 1,000.00 1,000.00 1,175.10 1,018.45 6.90 6.41 1.28 ------------------------------------------------------------------------------------------------------------------------ Class B 1,000.00 1,000.00 1,170.98 1,014.73 10.93 10.14 2.03 ------------------------------------------------------------------------------------------------------------------------ Class C 1,000.00 1,000.00 1,171.08 1,014.73 10.93 10.14 2.03 ------------------------------------------------------------------------------------------------------------------------ Class D 1,000.00 1,000.00 1,170.39 1,014.73 10.92 10.14 2.03 ------------------------------------------------------------------------------------------------------------------------ Class Z 1,000.00 1,000.00 1,176.88 1,019.69 5.56 5.16 1.03
Expenses paid during the period are equal to the fund's annualized expense ratio, multiplied by the average account value over the period, then multiplied by the number of days in the fund's most recent fiscal half-year and divided by 365. Had the Investment Advisor and the Fund's Transfer Agent not waived a portion of expenses, total return would have been reduced. It is important to note that the expense amounts shown in the table are meant to highlight only ongoing costs of investing in the fund and do not reflect any transactional costs, such as sales charges, redemption or exchange fees. Therefore, the hypothetical examples provided may not help you determine the relative total costs of owning shares of different funds. If these transactional costs were included, your costs would have been higher. COMPARE WITH OTHER FUNDS Since all mutual fund companies are required to include the same hypothetical calculations about expenses in shareholder reports, you can use this information to compare the ongoing cost of investing in the fund with other funds. To do so, compare the 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds. As you compare hypothetical examples of other funds, it is important to note that hypothetical examples are meant to highlight the continuing cost of investing in a fund and do not reflect any transactional costs, such as sales charges or redemption or exchange fees. 11 [sidebar] SUMMARY o FOR THE SIX-MONTH PERIOD ENDED FEBRUARY 28, 2005, THE FUND'S CLASS A SHARES RETURNED 17.51% WITHOUT SALES CHARGE. o THE FUND'S EMPHASIS ON THE ENERGY SECTOR, A HIGHER COMMITMENT TO EUROPEAN STOCKS AND STOCK SELECTION IN EUROPEAN MARKETS ALL CONTRIBUTED TO THE FUND'S DOUBLE-DIGIT RETURN. o STOCK SELECTION IN JAPAN AND THE UNITED KINGDOM (UK) WERE THE PRINCIPAL REASONS THE FUND FELL BEHIND ITS BENCHMARKS. [UP ARROW] [UP ARROW] MSCI ALL COUNTRY CLASS A SHARES WORLD EX US INDEX 17.51% 22.84% OBJECTIVE Seeks long-term capital appreciation by investing in stocks issued by companies from at least three countries outside the United States. TOTAL NET ASSETS $678.0 million NET ASSET VALUE PER SHARE AS OF 02/28/05 ($) Class A 15.32 ----------------------------------------------- Class B 15.00 ----------------------------------------------- Class C 15.05 ----------------------------------------------- Class D 15.11 ----------------------------------------------- Class Z 15.38 DISTRIBUTIONS DECLARED PER SHARE 09/01/04 - 02/28/05 ($) Class A 0.00 ----------------------------------------------- Class B 0.00 ----------------------------------------------- Class C 0.00 ----------------------------------------------- Class D 0.00 ----------------------------------------------- Class Z 0.07 PORTFOLIO MANAGERS' REPORT _____________________________________________________ Columbia International Stock Fund For the six-month period ended February 28, 2005, Columbia International Stock Fund class A shares returned 17.51% without sales charge. The fund's benchmarks, the MSCI All Country World ex US Index and the MSCI EAFE Index, returned 22.84% and 21.18%, respectively. Its peer group, the Lipper International Multi-Cap Growth Fund Category, had an average return of 20.07% for the same period. 1 Strong performance from the energy sector and from European stocks helped boost the fund's return. Stock selection in Japan and the United Kingdom (UK) were the principal reasons the fund fell behind its benchmarks. ENERGY STOCKS BOOSTED THE FUND'S RETURN In the past three years, an increase in the rate of global economic growth, supply disruptions and an increase in Chinese imports contributed to higher oil prices. We positioned the fund to take advantage of these factors by emphasizing oil and gas stocks as well as oil service stocks in the portfolio. This decision was rewarded as the price of oil remained strong and energy stocks soared during the period. Canada's EnCana Corp., the largest oil and gas exploration company in North America, was the fund's top performer. HIGHER STAKE IN EUROPEAN STOCKS AIDED PERFORMANCE A decision to raise the fund's commitment to European stocks with long-term growth prospects also aided performance. We focused on smaller markets that were growing faster than Europe as a whole and that were attractively priced relative to their earnings potential compared to larger markets. In particular, the fund's investments in Austria and Greece did well. Both countries have fast-growing economies, relatively low interest rates and policies that are friendly to business. When selecting stocks, we gravitated toward banks, which have had a substantial increase in loan demand in the improving economic environment. The National Bank of Greece SA, Erste Bank in Austria (sold in January 2005) and the Anglo Irish Bank in Ireland made positive contributions to performance. The fund's strategy in Europe reflected two main themes, which influenced stock selection across the portfolio. In general, we favored companies that we believed were likely to increase dividend payouts and/or benefit from increased capital spending. With these themes in mind, we increased investment in the industrials sector, a strategy that added the most value over the period. Two companies were particularly strong--Atlas Copco AB in Sweden, an electric tool manufacturer, and Vinci SA in France, a construction company. Telecommunications companies also reflected these themes. We added Belgacom SA, Belgium's telecommunications company, which benefited from cost-cutting and improved operations. In addition, we believe that the company has the potential to increase its dividend. 1 Lipper Inc., a widely respected data provider in the industry, calculates an average total return for mutual funds with similar investment objectives as those of the fund. 12 [sidebar] TOP 5 COUNTRIES AS OF 02/28/05 (%) United Kingdom 22.0 ----------------------------------------------- Japan 21.3 ----------------------------------------------- France 8.8 ----------------------------------------------- Germany 6.4 ----------------------------------------------- Netherlands 5.8 TOP 10 HOLDINGS AS OF 02/28/05 (%) BP 2.2 ----------------------------------------------- Nestle SA 1.8 ----------------------------------------------- Vodafone Group 1.8 ----------------------------------------------- GlaxoSmithKline 1.7 ----------------------------------------------- Total SA 1.6 ----------------------------------------------- EnCana 1.6 ----------------------------------------------- ENI S.p.A 1.5 ----------------------------------------------- Reckitt Benckiser 1.4 ----------------------------------------------- HSBC Holdings 1.4 ----------------------------------------------- Randstad Holdings NV 1.3 HOLDINGS DISCUSSED IN THIS REPORT AS OF 02/28/05 (%) EnCana 1.6 ----------------------------------------------- National Bank of Greece SA 0.7 ----------------------------------------------- Anglo Irish Bank 0.8 ----------------------------------------------- Atlas Copco AB 1.2 ----------------------------------------------- Vinci SA 1.1 ----------------------------------------------- Belgacom SA 0.6 ----------------------------------------------- AstraZeneca 1.2 Your fund is actively managed and the composition of its portfolio will change over time. Information provided is calculated as a percentage of net assets. ________________________________________________________________________________ Columbia International Stock Fund JAPANESE AND UK INVESTMENTS DISAPPOINT During the period, we boosted the fund's investment in Japan on the belief that its economy was headed for a strong recovery after more than 10 years of recession and deflation. However, inflation did not return as fast as forecasts suggested, consumer spending did not rebound at the pace we originally anticipated and consumer-related Japanese stocks declined. Telecommunications stocks in Japan also detracted from performance. Pharmaceutical companies in the United Kingdom also held back results. AstraZeneca lost traction when the FDA postponed approval of IRESSA, a cancer drug. In addition, prescription trends were disappointing for Crestor, AstraZeneca's cholesterol-lowering drug. However, the stock remains in the portfolio because we continue to believe that it has long-term potential. LOOKING AHEAD Going forward we will continue to seek companies that exhibit one or more of the following characteristics: 1) are likely to increase dividends and/or share buybacks, 2) could benefit from increased capital expenditures, and 3) stand to benefit from improved employment growth, such as retail stocks. In general, we plan to focus on large-cap stocks which we believe have the potential to outperform small-caps. However, any change in the economic or market climate could lead us to change our focus. [Photo of Penelope L. Burgess] Penelope L. Burgess has co-managed the fund since July 2004 and has been with the advisor or its predecessors or affiliate organizations since 1993. /s/ Penelope L. Burgess [Photo of Deborah F. Snee] Deborah F. Snee has co-managed the fund since July 2004 and has been with the advisor or its predecessors or affiliate organizations since 1999. /s/ Deborah F. Snee Equity investments are affected by stock market fluctuations that occur in response to economic and business developments. International investing may involve certain risks, including foreign taxation, currency fluctuations, risks associated with possible differences in financial standards and other monetary and political risks. 13 [sidebar] PERFORMANCE OF A $10,000 INVESTMENT 03/01/95 - 02/28/05 ($) SALES CHARGE WITHOUT WITH ----------------------------------------------- Class A 24,208 22,814 ----------------------------------------------- Class B 23,785 23,785 ----------------------------------------------- Class C 23,832 23,832 ----------------------------------------------- Class D 23,809 23,575 ----------------------------------------------- Class G 23,715 23,715 ----------------------------------------------- Class T 24,255 22,858 ----------------------------------------------- Class Z 24,455 n/a Performance data quoted represents past performance and current performance may be lower or higher. Past performance is no guarantee of future results. The investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than the original cost. Please visit www.columbiafunds.com for daily and most recent month-end performance updates. PERFORMANCE INFORMATION ________________________________________________________ Columbia Mid Cap Growth Fund VALUE OF A $10,000 INVESTMENT 03/01/95 - 02/28/05 [MOUNTAIN CHART] CLASS A CLASS A SHARES WITHOUT SHARES WITH RUSSELL MIDCAP RUSSELL MIDCAP SALES CHARGE SALES CHARGE GROWTH INDEX INDEX -------------- ------------ -------------- -------------- 03/1995 10000 9425 10000 10000 10266 9676 10397 10286 10298 9706 10484 10441 10418 9819 10742 10785 11082 10445 11231 11147 11923 11237 11937 11689 12122 11425 12069 11868 12315 11607 12338 12136 11803 11124 12026 11864 12440 11725 12563 12454 12648 11920 12570 12526 12553 11831 12792 12790 13113 12359 13276 13091 13431 12659 13380 13281 14605 13765 14027 13657 15019 14155 14313 13863 14158 13344 13881 13655 12772 12038 12804 12810 13551 12772 13496 13419 14075 13266 14353 14082 13680 12893 14185 14195 14441 13610 15021 15059 14300 13478 14768 14906 14639 13798 15421 15463 14410 13581 15082 15440 13711 12922 14230 14784 13609 12827 14578 15152 14884 14029 15885 16258 15367 14483 16325 16790 16232 15298 17887 18190 16182 15251 17712 17992 16966 15991 18608 19019 15979 15060 17676 18279 16145 15217 17861 18714 16110 15183 18095 19231 15679 14778 17769 18869 16681 15722 19440 20345 17739 16719 20254 21309 17684 16667 20530 21362 17222 16232 19686 20702 17501 16495 20243 20990 16308 15370 19377 19989 14264 13444 15678 16791 15259 14381 16863 17877 15895 14981 18104 19096 16626 15670 19326 19999 18791 17710 21328 21171 18409 17351 21968 21135 16891 15919 20894 20432 17369 16370 22058 21071 17933 16902 23063 22628 17981 16948 22766 22563 19238 18132 24355 23359 18736 17659 23581 22717 18386 17329 23335 22128 18640 17568 23137 21349 19762 18625 24925 22361 22204 20928 27508 23005 25617 24144 32272 25030 26053 24555 32266 24201 33483 31558 39048 26063 32944 31049 39087 27556 29725 28016 35291 26253 28099 26483 32719 25557 31215 29420 36190 26313 29982 28258 33899 26019 34177 32212 39011 28511 33459 31535 37104 28103 31124 29334 34566 27671 26614 25084 27055 25180 29166 27489 28480 27097 28662 27014 30107 27533 25440 23977 24898 25856 23252 21915 21335 24253 25475 24010 24892 26327 25060 23619 24775 26816 24599 23184 24787 26564 23701 22338 23117 25804 22355 21069 21441 24811 19829 18688 17897 21819 20546 19365 19777 22683 22229 20951 21907 24584 23045 21720 22740 25572 22268 20988 22001 25418 21268 20046 20753 25149 22525 21230 22337 26658 21949 20687 21155 26141 21595 20354 20525 25845 20103 18947 18259 24114 18563 17496 16484 21760 18129 17086 16426 21880 17329 16333 15122 19860 17811 16787 16294 20863 18317 17264 17570 22311 17365 16366 16509 21432 17365 16366 16347 20999 16965 15990 16205 20722 17070 16089 16506 20927 17929 16898 17630 22447 19469 18350 19326 24500 19786 18649 19603 24748 20210 19048 20302 25565 21269 20046 21421 26674 20129 18971 21006 26341 21751 20501 22699 28350 22352 21066 23307 29147 22550 21254 23561 30022 23033 21709 24339 30895 22962 21641 24747 31559 22727 21421 24700 31566 21634 20390 24004 30407 21915 20655 24570 31161 22422 21132 24961 32024 20424 19250 23309 30625 19977 18828 23022 30757 20824 19626 23881 31756 21671 20425 24690 32633 23000 21677 25964 34620 24106 22720 27208 36095 23672 22311 26479 35200 02/2005 24208 22814 27146 36283 The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The Russell Midcap Growth Index is an unmanaged index that measures the performance of those Russell Midcap companies with higher price-to-book ratios and higher forecasted growth values. The Russell Midcap Index is an unmanaged index that measures the performance of the 800 smallest companies in the Russell 1000 Index, as ranked by total market capitalization. Unlike the fund, indices are not investments, do not incur fees or expenses and are not professionally managed. It is not possible to invest directly in an index. Securities in the fund may not match those in an index. AVERAGE ANNUAL TOTAL RETURN AS OF 02/28/05 (%)
------------------------------------------------------------------------------------------------------------------------------------ SHARE CLASS A B C D G T Z ------------------------------------------------------------------------------------------------------------------------------------ INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 11/01/02 11/01/02 11/20/85 ------------------------------------------------------------------------------------------------------------------------------------ SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT ------------------------------------------------------------------------------------------------------------------------------------ 6-month (cumulative) 21.19 14.22 20.78 15.78 20.73 19.73 20.75 19.75 20.78 15.78 21.14 14.17 21.35 ------------------------------------------------------------------------------------------------------------------------------------ 1-year 5.43 -0.63 4.60 -0.40 4.65 3.65 4.65 3.65 4.45 -0.55 5.36 -0.67 5.74 ------------------------------------------------------------------------------------------------------------------------------------ 5-year -6.28 -7.39 -6.61 -6.88 -6.57 -6.57 -6.59 -6.78 -6.67 -7.08 -6.24 -7.35 -6.09 ------------------------------------------------------------------------------------------------------------------------------------ 10-year 9.24 8.60 9.05 9.05 9.07 9.07 9.06 8.95 9.02 9.02 9.26 8.62 9.35
AVERAGE ANNUAL TOTAL RETURN AS OF 12/31/04 (%)
------------------------------------------------------------------------------------------------------------------------------------ SHARE CLASS A B C D G T Z ------------------------------------------------------------------------------------------------------------------------------------ SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT ------------------------------------------------------------------------------------------------------------------------------------ 6-month (cumulative) 7.50 1.32 7.12 2.12 7.10 6.10 7.11 6.11 7.14 2.14 7.48 1.28 7.64 ------------------------------------------------------------------------------------------------------------------------------------ 1-year 6.88 0.74 6.05 1.05 6.14 5.14 6.15 5.15 5.84 0.84 6.87 0.74 7.31 ------------------------------------------------------------------------------------------------------------------------------------ 5-year -1.21 -2.38 -1.53 -1.82 -1.49 -1.49 -1.51 -1.71 -1.59 -2.02 -1.17 -2.34 -1.02 ------------------------------------------------------------------------------------------------------------------------------------ 10-Year 9.46 8.81 9.28 9.28 9.30 9.30 9.29 9.18 9.25 9.25 9.48 8.83 9.56
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF 5.75% FOR CLASS A AND T SHARES, MAXIMUM CONTINGENT DEFERRED SALES CHARGE OF 5.00% FOR CLASS B AND G SHARES AND 1.00% FOR CLASS C AND D SHARES FOR THE FIRST YEAR ONLY. THE "WITHOUT SALES CHARGE" RETURNS DO NOT INCLUDE THE EFFECT OF SALES CHARGES. IF THEY HAD, RETURNS WOULD HAVE BEEN LOWER. ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS. CLASS Z SHARES ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT SHARE CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES ASSOCIATED WITH EACH CLASS. Effective October 13, 2003, class D shares were closed to all new investors and new accounts. Existing class D shareholders will be able to make additional purchases at any time. In addition, the class D initial sales charge of 1.00% is waived after October 13, 2003. Performance results reflect any voluntary waivers or reimbursement of fund expenses by the advisor or its affiliates. Absent these waivers or reimbursement arrangements, performance results would have been lower. Classes A, B, D, G and T (newer class shares) share performance information includes returns of the fund's class Z shares (the oldest existing fund class) for periods prior to the inception of the newer class shares. The returns for class C include the returns of class B prior to 10/13/03, the date on which class C was initially offered by the fund. The returns shown for class C also include the performance of class Z prior to the inception of class B (11/01/02). Class Z share returns are not restated to reflect any expense differential (e.g., Rule 12b-1 fees) between class Z shares and the newer class shares. Had the expense differential been reflected, the returns for the periods prior to the inception of classes A, B, C, D, G and T would have been lower. 14 [sidebar] ESTIMATING YOUR ACTUAL EXPENSES To estimate the expenses that you paid over the period, first you will need your account balance at the end of the period: o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611 o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE 1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6 2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD," LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1. YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING THE PERIOD UNDERSTANDING YOUR EXPENSES ____________________________________________________ Columbia Mid Cap Growth Fund As a fund shareholder, you incur two types of costs. There are transaction costs, which generally include sales charges on purchases and may include redemption or exchange fees. There are also ongoing costs, which generally include investment advisory fees, Rule 12b-1 fees, and other fund expenses. The information on this page is intended to help you understand your ongoing costs of investing in the fund and to compare these costs with the ongoing costs of investing in other mutual funds. ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS To illustrate these ongoing costs, we have provided an example and calculated the expenses paid by investors in each share class during the reporting period. The information in the following table is based on an initial investment of $1,000, which is invested at the beginning of the reporting period and held for the entire period. Expense information is calculated two ways and each method provides you with different information. The amount listed in the "actual" column is calculated using the fund's actual operating expenses and total return for the period. The amount listed in the "hypothetical" column for each share class assumes that the return each year is 5% before expenses and includes the fund's actual expense ratio. You should not use the hypothetical account values and expenses to estimate either your actual account balance at the end of the period or the expenses you paid during this reporting period. 09/01/04 - 02/28/05
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%) ------------------------------------------------------------------------------------------------------------------------ ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ------------------------------------------------------------------------------------------------------------------------ Class A 1,000.00 1,000.00 1,211.89 1,018.50 6.97 6.36 1.27 ------------------------------------------------------------------------------------------------------------------------ Class B 1,000.00 1,000.00 1,207.78 1,014.78 11.06 10.09 2.02 ------------------------------------------------------------------------------------------------------------------------ Class C 1,000.00 1,000.00 1,207.28 1,014.78 11.06 10.09 2.02 ------------------------------------------------------------------------------------------------------------------------ Class D 1,000.00 1,000.00 1,207.48 1,014.78 11.06 10.09 2.02 ------------------------------------------------------------------------------------------------------------------------ Class G 1,000.00 1,000.00 1,207.78 1,015.03 10.78 9.84 1.97 ------------------------------------------------------------------------------------------------------------------------ Class T 1,000.00 1,000.00 1,211.40 1,018.25 7.24 6.61 1.32 ------------------------------------------------------------------------------------------------------------------------ Class Z 1,000.00 1,000.00 1,213.48 1,019.74 5.60 5.11 1.02
Expenses paid during the period are equal to the fund's annualized expense ratio, multiplied by the average account value over the period, then multiplied by the number of days in the fund's most recent fiscal half-year and divided by 365. Had the Fund's Transfer Agent not waived a portion of expenses, total return would have been reduced. It is important to note that the expense amounts shown in the table are meant to highlight only ongoing costs of investing in the fund and do not reflect any transactional costs, such as sales charges, redemption or exchange fees. Therefore, the hypothetical examples provided may not help you determine the relative total costs of owning shares of different funds. If these transactional costs were included, your costs would have been higher. COMPARE WITH OTHER FUNDS Since all mutual fund companies are required to include the same hypothetical calculations about expenses in shareholder reports, you can use this information to compare the ongoing cost of investing in the fund with other funds. To do so, compare the 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds. As you compare hypothetical examples of other funds, it is important to note that hypothetical examples are meant to highlight the continuing cost of investing in a fund and do not reflect any transactional costs, such as sales charges or redemption or exchange fees. 15 [sidebar] SUMMARY o FOR THE SIX-MONTH PERIOD ENDED FEBRUARY 28, 2005, THE FUND'S CLASS A SHARES RETURNED 21.19% WITHOUT SALES CHARGE. o THE FUND OUTPERFORMED THE RUSSELL MIDCAP GROWTH INDEX AND THE RUSSELL MIDCAP INDEX, AS WELL AS THE AVERAGE OF ITS PEER GROUP, THE LIPPER MID-CAP GROWTH FUNDS CATEGORY. o STRONG STOCK SELECTION IN THE INFORMATION TECHNOLOGY AND MATERIALS SECTORS DROVE THE FUND'S OUTPERFORMANCE. [UP ARROW] [UP ARROW] [UP ARROW] RUSSELL RUSSELL CLASS A MIDCAP MIDCAP SHARES GROWTH INDEX INDEX 21.19% 17.94% 17.98% OBJECTIVE Seeks significant capital appreciation by investing in stocks of companies with a market capitalization, at the time of initial purchase, equal to or less than the largest stock in the Russell Midcap Index. TOTAL NET ASSETS $864.9 million NET ASSET VALUE PER SHARE AS OF 02/28/05 ($) Class A 20.59 ----------------------------------------------- Class B 20.23 ----------------------------------------------- Class C 20.27 ----------------------------------------------- Class D 20.25 ----------------------------------------------- Class G 20.17 ----------------------------------------------- Class T 20.63 ----------------------------------------------- Class Z 20.80 PORTFOLIO MANAGERS' REPORT _____________________________________________________ Columbia Mid Cap Growth Fund For the six-month period ended February 28, 2005, Columbia Mid Cap Growth Fund class A shares returned 21.19% without sales charge. The fund outperformed both the Russell Midcap Growth Index and the Russell Midcap Index, which returned 17.94% and 17.98%, respectively, during the same period. The fund also outpaced its peer group, the Lipper Mid-Cap Growth Funds Category, which averaged a return of 16.91%. 1 Strong stock selection, particularly in the information technology and materials sectors, helped the fund outperform its benchmark and peers. SEMICONDUCTOR STOCKS LED TECH PERFORMANCE The fund's new management team, in place since June 2004, restructured holdings in key sectors in an effort to reduce portfolio risk. A good example is the information technology sector, where the team eliminated commodity-type businesses in favor of those with greater intellectual property content, as reflected in companies with higher gross margins. As a result, the portfolio was well positioned for the market rally in the fourth quarter of 2004. Certain semiconductor stocks performed exceptionally well. Marvell Technology Group benefited from a new product introduction, which allowed it to attack new markets. NVIDIA benefited from the introduction of a new graphics chip, and Advanced Micro Devices gained market share, resulting in increased revenues and higher gross margins. Although the fund's technology holdings outperformed, we believe there is room for improvement within the sector. We have expanded coverage of internet-related stocks, where we missed some opportunities and misjudged others. STOCK SELECTION IN MATERIALS AND ENERGY AIDED PERFORMANCE Good stock selection in the materials and energy sectors also contributed to the portfolio's strong performance. Growing demand for and limited supply of raw materials drove commodity prices higher. Potash Corp. of Saskatchewan benefited as demand for potash, a fertilizer, increased. Peabody Energy's stock price advanced as coal grew increasingly attractive amid rising oil prices. Among energy stocks, oil and gas companies benefited from higher prices and significantly outperformed energy service companies. Although the fund had more exposure to energy service names than its benchmark, good stock selection compensated. National-Oilwell and Nabors Industries gained 52% and 30%, respectively. If commodity prices remain strong, we believe that exploration companies will increase spending and energy service companies should benefit. 1 Lipper Inc., a widely respected data provider in the industry, calculates an average total return for mutual funds with similar investment objectives as those of the fund. 16 [sidebar] TOP 5 SECTORS AS OF 02/28/05 (%) Information technology 25.0 ----------------------------------------------- Consumer discretionary 20.7 ----------------------------------------------- Health care 15.9 ----------------------------------------------- Industrials 10.9 ----------------------------------------------- Materials 7.0 TOP 10 HOLDINGS AS OF 02/28/05 (%) Tempur-Pedic International 2.8 ----------------------------------------------- Potash Corp. of Saskatchewan 2.1 ----------------------------------------------- XM Satellite Radio Holdings 1.8 ----------------------------------------------- Urban Outfitters 1.8 ----------------------------------------------- Kinetic Concepts 1.8 ----------------------------------------------- Marvell Technology Group 1.7 ----------------------------------------------- Medicis Pharmaceutical 1.7 ----------------------------------------------- Manpower 1.6 ----------------------------------------------- Inco 1.5 ----------------------------------------------- DaVita 1.4 HOLDINGS DISCUSSED IN THIS REPORT AS OF 02/28/05 (%) Marvell Technology Group 1.7 ----------------------------------------------- NVIDIA 1.0 ----------------------------------------------- Advanced Micro Devices 1.1 ----------------------------------------------- Potash Corp. of Saskatchewan 2.1 ----------------------------------------------- Peabody Energy 0.9 ----------------------------------------------- National-Oilwell 0.7 ----------------------------------------------- Nabors Industries 1.2 ----------------------------------------------- Chico's FAS 1.3 ----------------------------------------------- Coach 0.9 ----------------------------------------------- Western Wireless 0.3 ----------------------------------------------- Kinetic Concepts 1.8 ----------------------------------------------- DaVita 1.4 ----------------------------------------------- Accredo Health 0.8 Your fund is actively managed and the composition of its portfolio will change over time. Information provided is calculated as a percentage of net assets. ________________________________________________________________________________ Columbia Mid Cap Growth Fund PORTFOLIO GAINS WERE WIDESPREAD The fund registered attractive gains from stocks in a wide range of sectors and industries. Consumer discretionary stocks, such as retailers Chico's FAS and Coach, benefited from enhanced consumer confidence. Telecommunications services stocks also outperformed, led by Western Wireless, up 57% on news of its acquisition by ALLTEL. In health care, Kinetic Concepts benefited from increased market penetration, DaVita advanced on the news of its purchase of Gambro Healthcare's US dialysis business and Accredo Health's stock price soared on the news of its acquisition by Medco Health Services. FINANCIAL STOCKS DETRACTED FROM PERFORMANCE We maintained low exposure to the financial sector amid concerns about the effects of a rising interest rate environment. Although the fund's financial holdings advanced, they were not as strong as the sector overall. Performance was hurt by not owning some of the best performing stocks in the period, such as Moody's and Legg Mason. We plan to maintain our low exposure to the financial sector because we do not expect the Federal Reserve (the Fed) to alter its current interest rate policy. MONITORING THE ECONOMY AND MARKETS We have positioned the portfolio to reflect an economy that is growing at a healthy pace. We are bullish on the energy sector and see continued strength in the materials and industrials sectors. Ongoing job creation, the unprecedented liquidity of corporate balance sheets and a Fed that appears to be controlling inflation are supportive of our outlook. Because of the portfolio's pro-cyclical positioning, however, we are monitoring the economy and markets for signs of slowing growth. Kenneth A. Korngiebel has co-managed the fund since June 2004 and has been with the advisor or its predecessors or affiliate organizations since 1996. /s/ Kenneth A. Korngiebel Trent E. Nevills has co-managed the fund since June 2004 and has been with the advisor or its predecessors or affiliate organizations since 2003. /s/ Trent E. Nevills Equity investment is affected by stock market fluctuations that occur in response to economic and business developments. Investing in mid-cap stocks may present special risks, including possible illiquidity and greater price volatility than stocks of larger, more established companies. 17 [sidebar] PERFORMANCE OF A $10,000 INVESTMENT 10/01/96 - 02/28/05 ($) Class Z 24,717 Performance data quoted represents past performance and current performance may be lower or higher. Past performance is no guarantee of future results. The investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than the original cost. Please visit www.columbiafunds.com for daily and most recent month-end performance updates. AVERAGE ANNUAL TOTAL RETURN AS OF 02/28/05 (%) SHARE CLASS Z ------------------------------------------------- INCEPTION 10/01/96 ------------------------------------------------- 6-month (cumulative) 17.82 ------------------------------------------------- 1-year 1.17 ------------------------------------------------- 5-year -4.30 ------------------------------------------------- Life 11.36 AVERAGE ANNUAL TOTAL RETURN AS OF 12/31/04 (%) SHARE CLASS Z ------------------------------------------------- 6-month (cumulative) 5.57 ------------------------------------------------- 1-year 9.61 ------------------------------------------------- 5-year 1.07 ------------------------------------------------- Life 11.95 PERFORMANCE INFORMATION ________________________________________________________ Columbia Small Cap Growth Fund VALUE OF A $10,000 INVESTMENT 10/01/96 - 02/28/05 [MOUNTAIN CHART] CLASS Z RUSSELL 2000 RUSSELL 2000 SHARES INDEX GROWTH INDEX ------- ------------ ------------ 10/1996 10000 10000 10000 10174 9876 9628 10488 10283 9896 10762 10552 10089 11508 10763 10341 10820 10503 9716 10224 10007 9030 10191 10035 8926 11475 11151 10267 12245 11629 10615 13098 12170 11159 13753 12449 11493 15021 13360 12411 14449 12774 11665 14201 12691 11387 14432 12913 11394 13817 12709 11242 14953 13648 12235 16261 14210 12748 16435 14288 12825 15247 13518 11893 15715 13547 12014 14978 12449 11011 11771 10032 8470 12854 10817 9329 12984 11258 9816 13720 11848 10577 15109 12582 11534 15030 12749 12054 13452 11716 10951 13678 11899 11340 14077 12965 12342 14381 13155 12362 15682 13749 13013 16089 13373 12611 15726 12878 12139 16002 12880 12374 17555 12933 12690 19965 13705 14032 24048 15257 16505 24250 15011 16352 30795 17489 20157 29560 16337 18039 26350 15353 16217 24885 14458 14796 28386 15719 16708 26206 15213 15276 29285 16374 16883 28067 15892 16044 26663 15183 14741 23453 13624 12064 25451 14794 12802 25767 15565 13838 22982 14544 11941 20994 13833 10856 23433 14915 12184 23600 15282 12467 23984 15809 12807 22785 14954 11715 21092 14471 10983 17835 12523 9210 19105 13255 10096 20452 14281 10939 21839 15163 11621 21249 15005 11207 20197 14594 10482 21535 15766 11393 20856 15909 11147 20089 15203 10494 18741 14449 9605 16203 12267 8128 16459 12236 8124 15751 11358 7538 16027 11722 7919 16942 12768 8704 16038 12057 8103 15988 11723 7883 15742 11369 7672 16056 11515 7788 17346 12607 8525 18950 13960 9486 19422 14212 9669 20141 15102 10400 21273 15794 10958 20624 15502 10681 22670 16804 11604 23191 17400 11982 23142 17753 12036 24519 18524 12668 24431 18691 12649 24136 18865 12709 22926 17902 12071 23321 18187 12311 24030 18953 12721 21817 17677 11578 20981 17587 11329 22240 18412 11956 22849 18775 12246 24236 20402 13281 25368 21006 13758 24069 20130 13139 02/2005 24717 20476 13322 The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The Russell 2000 Index is an unmanaged index that tracks the performance of the 2,000 smallest of the 3,000 largest U.S. companies based on market capitalization. The Russell 2000 Growth Index is an unmanaged index that measures the performance of those Russell 2000 Index companies with higher price-to-book ratios and higher forecasted growth values. Unlike the fund, indices are not investments, do not incur fees or expenses and are not professionally managed. It is not possible to invest directly in an index. Securities in the fund may not match those in an index. Index performance is from October 1, 1996. ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS. CLASS Z SHARES ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. Performance results reflect any voluntary waivers or reimbursement of fund expenses by the advisor or its affiliates. Absent these waivers or reimbursement arrangements, performance results would have been lower. 18 [sidebar] ESTIMATING YOUR ACTUAL EXPENSES To estimate the expenses that you paid over the period, first you will need your account balance at the end of the period: o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611 o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE 1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6 2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD," LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1. YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING THE PERIOD UNDERSTANDING YOUR EXPENSES ____________________________________________________ Columbia Small Cap Growth Fund As a fund shareholder, you incur two types of costs. There are transaction costs, which generally include sales charges on purchases and may include redemption or exchange fees. There are also ongoing costs, which generally include investment advisory fees and other fund expenses. The information on this page is intended to help you understand your ongoing costs of investing in the fund and to compare these costs with the ongoing costs of investing in other mutual funds. ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS To illustrate these ongoing costs, we have provided an example and calculated the expenses paid by investors in each share class during the reporting period. The information in the following table is based on an initial investment of $1,000, which is invested at the beginning of the reporting period and held for the entire period. Expense information is calculated two ways and each method provides you with different information. The amount listed in the "actual" column is calculated using the fund's actual operating expenses and total return for the period. The amount listed in the "hypothetical" column for each share class assumes that the return each year is 5% before expenses and includes the fund's actual expense ratio. You should not use the hypothetical account values and expenses to estimate either your actual account balance at the end of the period or the expenses you paid during this reporting period. 09/01/04 - 02/28/05
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%) -------------------------------------------------------------------------------------------------------------------------- ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL -------------------------------------------------------------------------------------------------------------------------- Class Z 1,000.00 1,000.00 1,178.22 1,018.84 6.48 6.01 1.20
Expenses paid during the period are equal to the fund's annualized expense ratio, multiplied by the average account value over the period, then multiplied by the number of days in the fund's most recent fiscal half-year and divided by 365. It is important to note that the expense amounts shown in the table are meant to highlight only ongoing costs of investing in the fund and do not reflect any transactional costs, such as sales charges, redemption or exchange fees. Therefore, the hypothetical examples provided may not help you determine the relative total costs of owning shares of different funds. If these transactional costs were included, your costs would have been higher. COMPARE WITH OTHER FUNDS Since all mutual fund companies are required to include the same hypothetical calculations about expenses in shareholder reports, you can use this information to compare the ongoing cost of investing in the fund with other funds. To do so, compare the 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds. As you compare hypothetical examples of other funds, it is important to note that hypothetical examples are meant to highlight the continuing cost of investing in a fund and do not reflect any transactional costs, such as sales charges or redemption or exchange fees. 19 [sidebar] SUMMARY o FOR THE SIX-MONTH PERIOD ENDED FEBRUARY 28, 2005, THE FUND'S CLASS Z SHARES RETURNED 17.82%. o THE FUND OUTPERFORMED ITS BENCHMARKS. ITS RETURN WAS SLIGHTLY LOWER THAN THE AVERAGE FOR ITS PEER GROUP, THE LIPPER SMALL-CAP GROWTH FUNDS CATEGORY. o STOCK SELECTION IN THE INFORMATION TECHNOLOGY AND INDUSTRIALS SECTORS ENHANCED THE FUND'S RETURNS, AS DID DECISIONS TO LIMIT EXPOSURE TO THE FINANCIALS SECTOR AND TO EMPHASIZE THE ENERGY SECTOR. [UP ARROW] [UP ARROW] [UP ARROW] CLASS Z RUSSELL 2000 RUSSELL 2000 SHARES GROWTH INDEX INDEX 17.82% 17.56% 16.40% OBJECTIVE Seeks capital appreciation by investing in stocks of companies with a market capitalization, at the time of initial purchase, equal to or less than the largest stock in the S&P SmallCap 600 Index. TOTAL NET ASSETS $261.9 million NET ASSET VALUE PER SHARE AS OF 02/28/05 ($) ------------------------------------------------ Class Z 25.12 ------------------------------------------------ PORTFOLIO MANAGERS' REPORT _____________________________________________________ Columbia Small Cap Growth Fund For the six-month period ended February 28, 2005, Columbia Small Cap Growth Fund class Z shares returned 17.82%. That was higher than the return of the Russell 2000 Growth Index, which was 17.56%, and the Russell 2000 Index, which was 16.40%, during the same period. The fund trailed its peer group, the Lipper Small-Cap Growth Funds Category, which averaged a return of 18.17%. 1 Strong stock selection in the information technology and industrials sectors contributed to the fund's competitive performance. Decisions to emphasize energy and to limit exposure to financials further enhanced results. Stock selection in the materials sector, however, detracted from relative performance. RESTRUCTURING TECHNOLOGY HOLDINGS IMPROVED PERFORMANCE A new management team took over the fund in June 2004. Early efforts to restructure the fund's technology holdings resulted in improved performance from the sector relative to its benchmark. We eliminated commodity-type businesses in favor of those with greater intellectual property content, as reflected in companies with higher gross margins. As a result of this emphasis on higher quality names, the fund was well positioned for the market rally in the fourth quarter of 2004. Communications equipment stocks, where the fund had significant exposure, led performance. Ixia advanced 127%, F5 Networks gained 124% and Packeteer rose 58%. INDUSTRIALS ENHANCED RESULTS, WHILE MATERIALS UNDERPERFORMED Solid stock selection in the industrial sector also made a positive contribution to the fund's performance. United Defense Industries saw its stock price move higher on news of its acquisition by BAE Systems within the defense industry. Alternate energy sources, such as coal, were more attractive because of high oil prices. As a result, Joy Global, which produces coal mining equipment, benefited from customers' needs to replace outdated machinery and from countries ramping up mining activity, particularly China. With an increased demand for raw materials in developing markets, we are evaluating other opportunities among companies in the industrials and materials sectors poised to benefit along the supply chain. We have maintained a relatively neutral exposure to the materials sector, which underperformed during the period. We sold our interest in GrafTech International, which appeared to be incapable of taking advantage of good end-market conditions. CONSTRUCTIVE OUTLOOK FOR ENERGY SERVICE INDUSTRY Energy stocks generated robust returns for the period. Oil and gas companies benefited from higher prices and outperformed all other industries. In this environment, XTO Energy, Quiksilver Resources and 1 Lipper Inc., a widely respected data provider in the industry, calculates an average total return for mutual funds with similar investment objectives as those of the fund. 20 [sidebar] TOP 5 SECTORS AS OF 02/28/05 (%) Information technology 29.3 ----------------------------------------------- Health care 21.0 ----------------------------------------------- Industrials 16.1 ----------------------------------------------- Consumer discretionary 12.7 ----------------------------------------------- Energy 7.8 TOP 10 HOLDINGS AS OF 02/28/05 (%) Tempur-Pedic International 2.6 ----------------------------------------------- United Defense Industries 2.2 ----------------------------------------------- Renal Care Group 2.1 ----------------------------------------------- Salix Pharmaceuticals 1.8 ----------------------------------------------- DaVita 1.5 ----------------------------------------------- Affiliated Managers Group 1.5 ----------------------------------------------- Silicon Laboratories 1.5 ----------------------------------------------- Corporate Executive Board 1.4 ----------------------------------------------- ResMed 1.4 ----------------------------------------------- Commercial Capital Bancorp 1.4 HOLDINGS DISCUSSED IN THIS REPORT AS OF 02/28/05 (%) Ixia 1.1 ----------------------------------------------- F5 Networks 1.3 ----------------------------------------------- Packeteer 1.3 ----------------------------------------------- United Defense Industries 2.2 ----------------------------------------------- Joy Global 1.2 ----------------------------------------------- XTO Energy 0.5 ----------------------------------------------- Quiksilver Resources 0.4 ----------------------------------------------- Range Resources 0.5 ----------------------------------------------- National-Oilwell 1.2 ----------------------------------------------- CAL Dive International 0.5 ----------------------------------------------- Key Energy Services 1.0 Your fund is actively managed and the composition of its portfolio will change over time. Information provided is calculated as a percentage of net assets. ________________________________________________________________________________ Columbia Small Cap Growth Fund Range Resources all made significant contributions. The fund also emphasized energy equipment and service companies in the period, such as National-Oilwell, CAL Dive International and Key Energy Services, which had strong gains. If commodity prices remain healthy, we believe that exploration companies will increase spending, and energy service companies should benefit. One energy stock that did disappoint was Input/Output. The company reported lower-than-expected earnings in the fourth quarter of 2004, after having previously disappointed investors. We eliminated our position in the stock during the period. LOW EXPOSURE TO FINANCIALS, CONSUMER DISCRETIONARY STOCKS AIDED PERFORMANCE We maintained low exposure to the financial sector amid concerns about the effects of rising interest rates. This under-representation, combined with good stock selection, also aided performance. We plan to maintain our low exposure to the financial sector because we do not expect the Fed to alter its current interest rate policy. The fund also had less exposure than the index to consumer discretionary stocks, where the portfolio's holdings underperformed. We sold particularly disappointing names, including PC Mall, Aeropostale and Radio One. PRO-CYCLICAL POSITIONING REQUIRES VIGILANCE We believe that the economy will continue to grow at a healthy pace and have positioned the portfolio accordingly. We are bullish on the energy sector and see continued strength in the materials and industrials sectors. Ongoing job creation, a build up of cash on corporate balance sheets and a Federal Reserve Board that appears to be controlling inflation are supportive of our outlook. Because of the portfolio's pro-cyclical positioning, however, we are monitoring the economy and markets for signs of slowing growth. Kenneth A. Korngiebel has co-managed the fund since June 2004 and has been with the advisor or its predecessors or affiliate organizations since 1996. /s/ Kenneth A. Korngiebel Trent E. Nevills has co-managed the fund since June 2004 and has been with the advisor or its predecessors or affiliate organizations since 2003. /s/ Trent E. Nevills Equity investments are affected by stock market fluctuations that occur in response to economic and business developments. Investments in small-cap stocks may be subject to greater volatility and price fluctuations because they may be thinly traded and less liquid than investments in larger companies. 21 [sidebar] PERFORMANCE OF A $10,000 INVESTMENT 03/01/95 - 02/28/05 ($) SALES CHARGE WITHOUT WITH ----------------------------------------------- Class A 41,183 38,801 ----------------------------------------------- Class B 40,529 40,529 ----------------------------------------------- Class C 40,512 40,512 ----------------------------------------------- Class D 40,541 40,119 ----------------------------------------------- Class Z 41,539 n/a Performance data quoted represents past performance and current performance may be lower or higher. Past performance is no guarantee of future results. The investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than the original cost. Please visit www.columbiafunds.com for daily and most recent month-end performance updates. PERFORMANCE INFORMATION ________________________________________________________ Columbia Real Estate Equity Fund VALUE OF A $10,000 INVESTMENT 03/01/95 - 02/28/05 [MOUNTAIN CHART] CLASS A CLASS A SHARES WITHOUT SHARES WITH NAREIT SALES CHARGE SALES CHARGE INDEX -------------- ------------ ------ 03/1995 10000 9425 10000 10070 9491 9960 9919 9349 9957 10409 9810 10380 10670 10057 10545 10833 10211 10727 10906 10279 10855 11179 10536 11041 10931 10302 10805 11022 10389 10903 12015 11325 11498 12243 11539 11688 12347 11637 11825 12271 11566 11760 12261 11556 11820 12540 11819 12125 12837 12099 12282 12856 12117 12374 13479 12703 12862 14043 13236 13086 14319 13495 13474 15056 14190 14089 16617 15662 15553 16946 15972 15727 17050 16069 15695 17283 16289 15662 16692 15732 15232 17221 16231 15680 18001 16966 16442 18945 17855 16950 18755 17677 16909 20432 19257 18385 19733 18598 17889 20230 19067 18275 20728 19536 18706 20651 19464 18607 20265 19100 18291 20948 19744 18618 20039 18887 18011 19883 18739 17885 19827 18687 17764 18659 17586 16611 17290 16295 15043 18187 17141 15894 17880 16852 15600 18243 17194 15829 18168 17123 15431 17844 16818 15108 17718 16699 14753 17613 16600 14687 19070 17973 16080 19642 18512 16434 19198 18094 16168 18490 17426 15654 18478 17416 15455 17652 16637 14868 17294 16300 14502 17151 16164 14266 17720 16701 14718 17793 16770 14766 17355 16357 14591 18256 17206 15071 19351 18238 16083 19512 18390 16241 20237 19074 16658 21980 20716 18114 21109 19896 17379 21981 20717 17932 20935 19731 17155 21553 20313 17375 22833 21520 18598 22616 21315 18791 22297 21015 18491 21913 20653 18670 22687 21383 19116 23177 21844 19579 24183 22792 20726 23755 22389 20314 24508 23099 21057 22961 21641 20183 22183 20908 19606 23461 22112 20684 24066 22682 21189 24213 22821 21231 24692 23273 21641 25626 24152 22940 25813 24329 23135 26324 24810 23447 26700 25165 24087 25317 23861 22827 25059 23618 22782 24069 22685 21907 23354 22011 20853 24548 23136 21835 24778 23354 21997 24109 22723 21357 24387 22984 21709 24809 23382 22143 25843 24357 23118 27102 25543 24514 27695 26103 25048 29061 27390 26388 29639 27935 26531 30407 28658 27433 30847 29074 27930 32143 30295 29147 33432 31510 30167 34485 32502 31471 35351 33318 32021 36952 34827 33792 32348 30488 28865 34279 32308 30923 35462 33423 31829 35316 33285 31935 37467 35313 34470 37883 35705 34449 39334 37072 36292 41332 38955 37857 43717 41203 39693 40451 38125 36359 02/2005 41183 38801 37470 The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The National Association of Real Estate Investment Trusts (NAREIT) Index is an unmanaged index that tracks performance of all publicly traded equity REIT. Unlike the fund, indices are not investments, do not incur fees or expenses and are not professionally managed. It is not possible to invest directly in an index. Securities in the fund may not match those in an index. AVERAGE ANNUAL TOTAL RETURN AS OF 02/28/05 (%)
SHARE CLASS A B C D Z ------------------------------------------------------------------------------------------------------------ INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 04/01/94 ------------------------------------------------------------------------------------------------------------ SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT ------------------------------------------------------------------------------------------------------------ 6-month (cumulative) 9.88 3.56 9.51 4.58 9.51 8.53 9.51 8.52 10.05 ------------------------------------------------------------------------------------------------------------ 1-year 16.46 9.76 15.65 10.65 15.61 14.61 15.61 14.61 16.73 ------------------------------------------------------------------------------------------------------------ 5-year 18.86 17.46 18.48 18.28 18.47 18.47 18.49 18.26 19.07 ------------------------------------------------------------------------------------------------------------ 10-year 15.21 14.52 15.02 15.02 15.02 15.02 15.02 14.90 15.30
AVERAGE ANNUAL TOTAL RETURN AS OF 12/31/04 (%)
SHARE CLASS A B C D Z ------------------------------------------------------------------------------------------------------------ SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT ------------------------------------------------------------------------------------------------------------ 6-month (cumulative) 23.27 16.19 22.79 17.79 22.81 21.81 22.80 21.80 23.42 ------------------------------------------------------------------------------------------------------------ 1-year 30.76 23.24 29.78 24.78 29.74 28.74 29.78 28.78 31.08 ------------------------------------------------------------------------------------------------------------ 5-year 19.80 18.38 19.43 19.23 19.42 19.42 19.44 19.19 19.98 ------------------------------------------------------------------------------------------------------------ 10-year 15.58 14.89 15.40 15.40 15.40 15.40 15.41 15.29 15.67
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF 5.75% FOR CLASS A SHARES, MAXIMUM CONTINGENT DEFERRED SALES CHARGE OF 5.00% FOR CLASS B SHARES AND 1.00%FOR CLASS C AND D SHARES FOR THE FIRST YEAR ONLY. THE "WITHOUT SALES CHARGE" RETURNS DO NOT INCLUDE THE EFFECT OF SALES CHARGES. IF THEY HAD, RETURNS WOULD BE LOWER. ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS. CLASS Z SHARES ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT SHARE CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES ASSOCIATED WITH EACH CLASS. Effective October 13, 2003, class D shares were closed to all new investors and new accounts. Existing class D shareholders will be able to make additional purchases at any time. In addition, class D initial sales charge of 1.00% is waived after October 13, 2003. Performance results reflect any voluntary waivers or reimbursement of fund expenses by the advisor or its affiliates. Absent these waivers or reimbursement arrangements, performance results would have been lower. Classes A, B and D (newer class shares) share performance information includes returns of the fund's class Z shares (the oldest existing fund class) for periods prior to the inception of the newer class shares. The returns for class C include the returns of class B prior to 10/13/03, the date on which class C was initially offered by the fund. The returns shown for class C also include the performance of class Z prior to the inception of class B (11/01/02). Class Z share returns are not restated to reflect any expense differential (e.g., Rule 12b-1 fees) between class Z shares and the newer class shares. Had the expense differential been reflected, the returns for the periods prior to the inception of classes A, B, C and D would have been lower. 22 [sidebar] ESTIMATING YOUR ACTUAL EXPENSES To estimate the expenses that you paid over the period, first you will need your account balance at the end of the period: o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611 o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE 1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6 2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD," LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1. YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING THE PERIOD UNDERSTANDING YOUR EXPENSES ____________________________________________________ Columbia Real Estate Equity Fund As a fund shareholder, you incur two types of costs. There are transaction costs, which generally include sales charges on purchases and may include redemption or exchange fees. There are also ongoing costs, which generally include investment advisory fees, Rule 12b-1 fees, and other fund expenses. The information on this page is intended to help you understand your ongoing costs of investing in the fund and to compare these costs with the ongoing costs of investing in other mutual funds. ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS To illustrate these ongoing costs, we have provided an example and calculated the expenses paid by investors in each share class during the reporting period. The information in the following table is based on an initial investment of $1,000, which is invested at the beginning of the reporting period and held for the entire period. Expense information is calculated two ways and each method provides you with different information. The amount listed in the "actual" column is calculated using the fund's actual operating expenses and total return for the period. The amount listed in the "hypothetical" column for each share class assumes that the return each year is 5% before expenses and includes the fund's actual expense ratio. You should not use the hypothetical account values and expenses to estimate either your actual account balance at the end of the period or the expenses you paid during this reporting period. 09/01/04 - 02/28/05
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%) ------------------------------------------------------------------------------------------------------------------ ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ------------------------------------------------------------------------------------------------------------------ Class A 1,000.00 1,000.00 1,098.78 1,018.89 6.19 5.96 1.19 ------------------------------------------------------------------------------------------------------------------ Class B 1,000.00 1,000.00 1,095.11 1,015.17 10.08 9.69 1.94 ------------------------------------------------------------------------------------------------------------------ Class C 1,000.00 1,000.00 1,095.11 1,015.17 10.08 9.69 1.94 ------------------------------------------------------------------------------------------------------------------ Class D 1,000.00 1,000.00 1,095.11 1,015.17 10.08 9.69 1.94 ------------------------------------------------------------------------------------------------------------------ Class Z 1,000.00 1,000.00 1,100.52 1,020.13 4.90 4.71 0.94
Expenses paid during the period are equal to the fund's annualized expense ratio, multiplied by the average account value over the period, then multiplied by the number of days in the fund's most recent fiscal half-year and divided by 365. It is important to note that the expense amounts shown in the table are meant to highlight only ongoing costs of investing in the fund and do not reflect any transactional costs, such as sales charges, redemption or exchange fees. Therefore, the hypothetical examples provided may not help you determine the relative total costs of owning shares of different funds. If these transactional costs were included, your costs would have been higher. COMPARE WITH OTHER FUNDS Since all mutual fund companies are required to include the same hypothetical calculations about expenses in shareholder reports, you can use this information to compare the ongoing cost of investing in the fund with other funds. To do so, compare the 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds. As you compare hypothetical examples of other funds, it is important to note that hypothetical examples are meant to highlight the continuing cost of investing in a fund and do not reflect any transactional costs, such as sales charges or redemption or exchange fees. 23 [sidebar] SUMMARY o FOR THE SIX-MONTH PERIOD ENDED FEBRUARY 28, 2005, THE FUND'S CLASS A SHARES RETURNED 9.88% WITHOUT SALES CHARGE. o THE FUND'S STRONG SIX-MONTH RETURN RELATIVE TO THE BENCHMARK INDEX IS ATTRIBUTABLE TO ITS SUBSTANTIAL HOLDINGS IN REAL ESTATE'S LODGING SECTOR, WHICH CONTINUED TO OUTPERFORM OTHER AREAS DURING THE PERIOD. o DEFENSIVE HOLDINGS IN PAPER AND FOREST PRODUCTS COMPANIES CONTINUED TO HOLD THE FUND BACK RELATIVE TO ITS PEER GROUP. [UP ARROW] [UP ARROW] CLASS A NAREIT SHARES INDEX 9.88% 8.69% OBJECTIVE Seeks capital appreciation and above-average income by investing in stocks of companies principally engaged in the real estate industry, including real estate investment trusts (REITs). TOTAL NET ASSETS $873.8 million NET ASSET VALUE PER SHARE AS OF 02/28/05 ($) Class A 25.22 ----------------------------------------------- Class B 25.24 ----------------------------------------------- Class C 25.22 ----------------------------------------------- Class D 25.23 ----------------------------------------------- Class Z 25.24 DISTRIBUTIONS DECLARED PER SHARE 09/01/04 - 02/28/05 ($) Class A 2.98 ----------------------------------------------- Class B 2.88 ----------------------------------------------- Class C 2.88 ----------------------------------------------- Class D 2.88 ----------------------------------------------- Class Z 3.02 PORTFOLIO MANAGER'S REPORT _____________________________________________________ Columbia Real Estate Equity Fund For the six-month period ended February 28, 2005, Columbia Real Estate Equity Fund class A shares returned 9.88% without sales charge. The fund outperformed the benchmark NAREIT Index, a common measure of real estate securities' performance, which returned 8.69%. The fund fell behind the average of the Lipper Real Estate Funds Category, which was 10.21%. 1 The fund's strong performance relative to the index was primarily due to a strong showing by lodging stocks, which represented a large share of the fund's portfolio. We believe its modest underperformance relative to the peer group was caused by its holdings in the paper and forest product sectors. ECONOMIC GROWTH INCREASES DEMAND FOR SPACE Real estate investment trust (REIT) stocks continued to benefit from relatively low interest rates and slowly increasing demand for space due to steady economic growth. Because of this favorable scenario, investors continued to commit funds to the REIT market and drove up REIT stock prices during 2004. Following this strong performance, January and February saw profit taking in the groups. Nevertheless, certain sectors of the real estate and REIT markets continued to shine--particularly lodging stocks--and the fund's ample holdings in that sector drove its outperformance relative to its benchmark. We believe that the fund's defensive posture, represented by an allocation to paper and forest product sectors, caused it to modestly underperform its peer group averages for the period. LODGING AND OFFICE SECTORS AID PERFORMANCE Positive travel trends continued to fuel returns in the lodging industry. Relative to the index, the fund held more than a triple weight allocation in the sector (18% versus 5% of the index at 02/28/05), which contributed significantly to its gains. Several of the fund's lodging holdings were standout performers, including Starwood Hotels & Resorts Worldwide, Marriott International, Hilton Hotels and Host Marriott. During the period, we increased the fund's exposure to the office industry as employment figures improved and many office REITs became attractively valued. The fund's office holdings with Manhattan real estate exposure were strong performers, including Brookfield Properties, a real estate operating company (REOC), SL Green Realty and Boston Properties. Appreciating real estate valuations in Florida's Panhandle drove the performance of the fund's single largest return contributor, St. Joe, a REOC and the largest private land holder in Northwestern Florida. 1 Lipper Inc., a widely respected data provider in the industry, calculates an average total return for mutual funds with similar investment objectives as those of the fund. 24 [sidebar] TOP 5 SECTORS AS OF 02/28/05 (%) Financials 74.1 ----------------------------------------------- Consumer discretionary 17.0 ----------------------------------------------- Materials 5.0 ----------------------------------------------- Consumer staples 1.1 ----------------------------------------------- Telecommunication services 0.5 TOP 10 HOLDINGS AS OF 02/28/05 (%) Hilton Hotels 5.6 ----------------------------------------------- Simon Property Group 5.6 ----------------------------------------------- iStar Financial 5.4 ----------------------------------------------- Alexandria Real Estate Equities 4.4 ----------------------------------------------- Starwood Hotels & Resorts Worldwide 4.1 ----------------------------------------------- Equity Residential 4.1 ----------------------------------------------- General Growth Properties 3.8 ----------------------------------------------- Regency Centers 3.8 ----------------------------------------------- Public Storage 3.6 ----------------------------------------------- Host Marriot 3.6 HOLDINGS DISCUSSED IN THIS REPORT as of 02/28/05 (%) Starwood Hotels & Resorts Worldwide 4.1 ----------------------------------------------- Marriott International 3.6 ----------------------------------------------- Hilton Hotels 5.6 ----------------------------------------------- Host Marriott 3.6 ----------------------------------------------- Brookfield Properties 1.9 ----------------------------------------------- SL Green Realty 1.7 ----------------------------------------------- Boston Properties 1.6 ----------------------------------------------- St. Joe 1.5 ----------------------------------------------- ProLogis Trust 3.1 Your fund is actively managed and the composition of its portfolio will change over time. Information provided is calculated as a percentage of new assets. ________________________________________________________________________________ Columbia Real Estate Equity Fund TRIMMING INDUSTRIALS, NON-REAL ESTATE HOLDINGS We reduced our holdings in industrial REITs to an underweight position relative to the index (9.3% versus 10.4% for the index) based on our conviction that many of these stocks are fairly valued relative to their business prospects. This hurt the fund's performance marginally as these stocks continued to shine. However, the fund's remaining industrial holdings performed well, with ProLogis Trust leading the pack. We also sold several of the fund's non-real estate holdings in paper and forest products with underlying businesses that benefit most from the early part of the economic cycle when interest rates fall and housing prices rise. We continue to hold three stocks in this area with business focuses that benefit from later stages of the economic cycle, such as newsprint and paper. THREAT OF RISING RATES LOOMS The biggest threat to REIT stocks is the potential for rising interest rates as the economy picks up steam and the Federal Reserve continues to apply the brakes by raising short-term rates. Because we believe that economic good news is already priced into many of these stocks, higher interest rates could provide a headwind for REIT stock prices. As a result, we plan to continue to hedge the fund's REIT positions by owning other real-estate related issues, particularly in sectors linked to a recovering economy such as lodging and late-cycle paper and forest products. Although we were early to position the fund defensively, we believe this posture is appropriate in the current environment. David Jellison has managed the fund since 1994 and has been with the advisor and its predecessors or affiliate organizations since 1992. /s/ David Jellison Equity investments are affected by stock market fluctuations that occur in response to economic and business developments. The fund may be subject to the same types of risks associated with direct ownership of real estate including the decline of property value due to general, local and regional economic conditions. In addition, the fund's share price will likely be subject to more volatility than the overall stock market because it concentrates in real estate stocks. 25 [sidebar] PERFORMANCE OF A $10,000 INVESTMENT 11/09/00 - 02/28/05 ($) SALES CHARGE WITHOUT WITH ----------------------------------------------- Class A 7,823 7,374 Class B 7,663 7,510 Class C 7,683 7,683 Class D 7,713 7,636 Class Z 7,882 n/a Performance data quoted represents past performance and current performance may be lower or higher. Past performance is no guarantee of future results. The investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than the original cost. Please visit www.columbiafunds.com for daily and most recent month-end performance updates. PERFORMANCE INFORMATION ________________________________________________________ Columbia Technology Fund VALUE OF A $10,000 INVESTMENT 11/09/00 - 02/28/05 [MOUNTAIN CHART] MERRILL CLASS A CLASS A LYNCH 100 SHARES WITHOUT SHARES WITH TECHNOLOGY SALES CHARGE SALES CHARGE INDEX -------------- ------------ ---------- 11/2000 10000 9425 10000 8713 8212 7744 8622 8127 7317 9142 8617 8577 6815 6423 6096 6145 5792 5123 7365 6941 6259 7135 6725 5891 7285 6866 5912 6745 6357 5377 6095 5745 4719 4547 4285 3495 5166 4869 4158 5896 5557 4944 6126 5773 4935 6086 5736 4962 5367 5058 4289 6106 5755 4788 5376 5067 4204 5047 4757 3969 4607 4342 3321 3888 3664 2877 3858 3636 2776 3468 3269 2277 3818 3598 2774 4258 4013 3386 3788 3570 2885 3828 3608 2876 3808 3589 2901 3679 3467 2880 4138 3900 3218 4888 4607 3764 4988 4701 3746 5398 5088 3916 5907 5568 4353 5977 5634 4204 6727 6340 4711 7066 6660 4862 6977 6576 4871 7496 7065 5182 7356 6933 5085 7286 6867 4941 6916 6519 4545 7226 6811 4811 7566 7131 4955 6687 6302 4389 6497 6123 4192 7016 6613 4403 7396 6971 4723 8156 7687 5057 8456 7970 5219 7656 7216 4848 02/2005 7823 7374 4932 The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The Merrill Lynch 100 Technology Index is an equally weighted, unmanaged index of 100 leading technology stocks. Unlike the fund, indices are not investments, do not incur fees or expenses and are not professionally managed. It is not possible to invest directly in an index. Securities in the fund may not match those in an index. Index performance is from November 9, 2000. AVERAGE ANNUAL TOTAL RETURN AS OF 02/28/05 (%)
SHARE CLASS A B C D Z ------------------------------------------------------------------------------------------------------------- INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 11/09/00 ------------------------------------------------------------------------------------------------------------- SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT ------------------------------------------------------------------------------------------------------------- 6-month (cumulative) 20.46 13.53 19.84 14.84 19.97 18.97 20.06 19.06 20.46 ------------------------------------------------------------------------------------------------------------- 1-year 6.39 0.27 5.36 0.36 5.63 4.63 5.61 4.61 6.62 ------------------------------------------------------------------------------------------------------------- Life -5.55 -6.83 -6.00 -6.44 -5.94 -5.94 -5.86 -6.07 -5.38
AVERAGE ANNUAL TOTAL RETURN AS OF 12/31/04 (%)
SHARE CLASS A B C D Z ------------------------------------------------------------------------------------------------------------- SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT ------------------------------------------------------------------------------------------------------------- 6-month (cumulative) 11.76 5.33 11.26 6.26 11.38 10.38 11.33 10.33 11.94 ------------------------------------------------------------------------------------------------------------- 1-year 21.20 14.23 19.94 14.94 20.23 19.23 20.14 19.14 21.51 ------------------------------------------------------------------------------------------------------------- Life -3.98 -5.34 -4.42 -4.88 -4.36 -4.36 -4.28 -4.51 -3.79
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF 5.75% FOR CLASS A SHARES, MAXIMUM CONTINGENT DEFERRED SALES CHARGE OF 5.00% FOR CLASS B SHARES AND 1.00% FOR CLASS C AND D SHARES FOR THE FIRST YEAR ONLY. THE "WITHOUT SALES CHARGE" RETURNS DO NOT INCLUDE THE EFFECT OF SALES CHARGES. IF THEY HAD, RETURNS WOULD BE LOWER. ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS. CLASS Z SHARES ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT SHARE CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES ASSOCIATED WITH EACH CLASS. Effective October 13, 2003, class D shares were closed to all new investors and new accounts. Existing class D shareholders will be able to make additional purchases at any time. In addition, class D initial sales charge of 1.00% is waived after October 13, 2003. Performance results reflect any voluntary waivers or reimbursement of fund expenses by the advisor or its affiliates. Absent these waivers or reimbursement arrangements, performance results would have been lower. Classes A, B and D (newer class shares) share performance information includes returns of the fund's class Z shares (the oldest existing fund class) for periods prior to the inception of the newer class shares. The returns for class C include the returns of class B prior to 10/13/03, the date on which class C was initially offered by the fund. The returns shown for class C also include the performance of class Z prior to the inception of class B (11/01/02). Class Z share returns are not restated to reflect any expense differential (e.g., Rule 12b-1 fees) between class Z shares and the newer class shares. Had the expense differential been reflected, the returns for the periods prior to the inception of classes A, B, C and D would have been lower. 26 [sidebar] ESTIMATING YOUR ACTUAL EXPENSES To estimate the expenses that you paid over the period, first you will need your account balance at the end of the period: o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611 o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE 1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6 2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD," LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1. YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING THE PERIOD UNDERSTANDING YOUR EXPENSES ____________________________________________________ Columbia Technology Fund As a fund shareholder, you incur two types of costs. There are transaction costs, which generally include sales charges on purchases and may include redemption or exchange fees. There are also ongoing costs, which generally include investment advisory fees, Rule 12b-1 fees, and other fund expenses. The information on this page is intended to help you understand your ongoing costs of investing in the fund and to compare these costs with the ongoing costs of investing in other mutual funds. ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS To illustrate these ongoing costs, we have provided an example and calculated the expenses paid by investors in each share class during the reporting period. The information in the following table is based on an initial investment of $1,000, which is invested at the beginning of the reporting period and held for the entire period. Expense information is calculated two ways and each method provides you with different information. The amount listed in the "actual" column is calculated using the fund's actual operating expenses and total return for the period. The amount listed in the "hypothetical" column for each share class assumes that the return each year is 5% before expenses and includes the fund's actual expense ratio. You should not use the hypothetical account values and expenses to estimate either your actual account balance at the end of the period or the expenses you paid during this reporting period. 09/01/04 - 02/28/05
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%) -------------------------------------------------------------------------------------------------------------------- ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL -------------------------------------------------------------------------------------------------------------------- Class A 1,000.00 1,000.00 1,204.60 1,015.37 10.39 9.49 1.90 -------------------------------------------------------------------------------------------------------------------- Class B 1,000.00 1,000.00 1,199.99 1,011.65 14.46 13.22 2.65 -------------------------------------------------------------------------------------------------------------------- Class C 1,000.00 1,000.00 1,199.70 1,011.65 14.45 13.22 2.65 -------------------------------------------------------------------------------------------------------------------- Class D 1,000.00 1,000.00 1,200.59 1,011.65 14.46 13.22 2.65 -------------------------------------------------------------------------------------------------------------------- Class Z 1,000.00 1,000.00 1,206.09 1,016.61 9.03 8.25 1.65
Expenses paid during the period are equal to the fund's annualized expense ratio, multiplied by the average account value over the period, then multiplied by the number of days in the fund's most recent fiscal half-year and divided by 365. Had the Investment Advisor not reimbursed a portion of expenses, total return would have been reduced. It is important to note that the expense amounts shown in the table are meant to highlight only ongoing costs of investing in the fund and do not reflect any transactional costs, such as sales charges, redemption or exchange fees. Therefore, the hypothetical examples provided may not help you determine the relative total costs of owning shares of different funds. If these transactional costs were included, your costs would have been higher. COMPARE WITH OTHER FUNDS Since all mutual fund companies are required to include the same hypothetical calculations about expenses in shareholder reports, you can use this information to compare the ongoing cost of investing in the fund with other funds. To do so, compare the 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds. As you compare hypothetical examples of other funds, it is important to note that hypothetical examples are meant to highlight the continuing cost of investing in a fund and do not reflect any transactional costs, such as sales charges or redemption or exchange fees. 27 [sidebar] SUMMARY o FOR THE SIX-MONTH PERIOD ENDED FEBRUARY 28, 2005, THE FUND'S CLASS A SHARES RETURNED 20.46% WITHOUT SALES CHARGE. o THE FUND OUTPERFORMED BOTH ITS BENCHMARK, THE MERRILL LYNCH 100 TECHNOLOGY INDEX, AND THE AVERAGE OF ITS PEER GROUP, THE LIPPER SCIENCE & TECHNOLOGY CATEGORY. o STRONG STOCK SELECTION WITHIN THE SEMICONDUCTOR, COMMUNICATIONS EQUIPMENT AND WIRELESS INDUSTRIES ACCOUNTED FOR ITS STRONG PERFORMANCE. [UP ARROW] [UP ARROW] MERRILL LYNCH 100 CLASS A SHARES TECHNOLOGY INDEX 20.46% 17.67% OBJECTIVE Seeks capital appreciation by investing in stocks of technology companies that may benefit from technological improvements, advancements or developments. TOTAL NET ASSETS $43.6 million NET ASSET VALUE PER SHARE AS OF 02/28/05 ($) Class A 7.83 ----------------------------------------------- Class B 7.67 ----------------------------------------------- Class C 7.69 ----------------------------------------------- Class D 7.72 ----------------------------------------------- Class Z 7.89 PORTFOLIO MANAGERS' REPORT _____________________________________________________ Columbia Technology Fund For the six-month period ended February 28, 2005, Columbia Technology Fund class A shares returned 20.46% without sales charge. The fund outperformed the Merrill Lynch 100 Technology Index, which returned 17.67% for the same period. It also surpassed the return of the Lipper Science & Technology Category average of 13.97%. 1 The fund benefited from strong stock selection within the semiconductor, communications equipment and wireless sectors. STOCK SELECTION IN SEMICONDUCTORS WAS STRONG In the first half of the reporting period, the technology sector performed in line with normal seasonal patterns. The sector experienced a strong fourth quarter in 2004 as consumer and corporate expenditures ramped up. It then pulled back in early 2005 as spending cooled. In this environment, the semiconductor industry made the greatest contribution to the fund's return, and superior stock selection helped the fund outperform. We avoided mega-sized companies, such as Intel and Texas Instruments, and focused on companies with specific product strengths. NVIDIA was a top performer as it reclaimed market share of high-end graphics and expanded into new markets with graphics for cellular phones. Advanced Micro Devices, a leading manufacturer of microprocessors for PCs, also benefited from the introduction of new products. OPPORTUNITIES IN COMMUNICATIONS-RELATED STOCKS Exceptional stock selection and an emphasis on the communications equipment industry also contributed to the fund's strong performance. We found opportunity in Nokia Oyj when it appeared that the market was overly pessimistic about growth in the cell phone market. We took a significant position in Nokia Oyj and benefited as the market readjusted its expectations. We also focused on Harris, which provides fixed wireless and radio systems. The company benefited from increased federal government defense spending and its shares rose. Comverse Technology gained ground as orders rebounded in an overall recovery for wireless usage. We maintained the fund's exposure to international markets with investments in wireless telecommunications service companies. Millicom International Cellular, a long-term position in the fund, provides cellular service in developing countries and has considerable market share in Africa, Asia and South America. Mobile TeleSystems and VimpelCom are Russian cell phone carriers, and we took advantage of short-term negative investor sentiment unrelated to their core businesses. We believe international cell phone service companies continue to offer greater upside potential than their US counterparts because of higher growth rates and lower competition in the developing markets they serve. STRONG PERFORMERS IN MEDIA, COMPUTERS The fund benefited from its emphasis on the digitization of media and its delivery to consumers and businesses. Persistent growth in the satellite radio market drove the share price higher for XM Satellite Radio Holdings. The company introduced new mobile products and continued to attract interest from the automobile industry. In computers and peripherals, our position in Apple Computer was higher than the index. The fund benefited from this decision as investor pessimism proved unwarranted: new products at attractive price points drove sales above expectations and Apple Computer shares soared. 1 Lipper Inc., a widely respected data provider in the industry, calculates an average total return for mutual funds with similar investment objectives as those of the fund. 28 [sidebar] TOP 5 SECTORS AS OF 02/28/05 (%) Information technology 67.8 ----------------------------------------------- Telecommunication services 15.0 ----------------------------------------------- Consumer discretionary 12.7 ----------------------------------------------- Health care 3.1 ----------------------------------------------- Industrials 1.1 TOP 10 HOLDINGS AS OF 02/28/05 (%) Nokia Oyj 4.9 ----------------------------------------------- Marvell Technology Group 3.3 ----------------------------------------------- SiRF Technology Holdings 3.3 ----------------------------------------------- Nvidia 3.1 ----------------------------------------------- eBay 2.9 ----------------------------------------------- XM Satellite Radio Holdings 2.9 ----------------------------------------------- Lions Gate Entertainment 2.4 ----------------------------------------------- Sigmatel 2.4 ----------------------------------------------- VeriSign 2.1 ----------------------------------------------- Harris 2.1 HOLDINGS DISCUSSED IN THIS REPORT AS OF 02/28/05 (%) NVIDIA 3.1 ----------------------------------------------- Advanced Micro Devices 0.6 ----------------------------------------------- Nokia Oyj 4.9 ----------------------------------------------- Harris 2.1 ----------------------------------------------- Comverse Technology 1.2 ----------------------------------------------- Millicom International Cellular 1.1 ----------------------------------------------- Mobile TeleSystems 2.0 ----------------------------------------------- VimpelCom 1.6 ----------------------------------------------- XM Satellite Radio Holdings 2.9 ----------------------------------------------- Apple Computer 2.0 ----------------------------------------------- eBay 2.9 Your fund is actively managed and the composition of its portfolio will change over time. Information provided is calculated as a percentage of net assets. ________________________________________________________________________________ Columbia Technology Fund INTERNET, ELECTRONIC EQUIPMENT STOCKS DETRACT FROM PERFORMANCE The fund's Internet catalog and retail stocks were caught in a widespread sell-off after the holiday shopping season. We liquidated our investment in PC Mall, which fell short of earnings projections. eBay also came under pressure due to recurring issues about growth potential. We believe that these concerns are unfounded, but we will continue to monitor the stock closely. In the electronic equipment and instrument industry, I.D. Systems and Viisage Technology both underperformed as they got caught up in the turmoil surrounding technology identity systems and homeland security. We sold both positions. INVESTMENT THEMES GUIDE STOCK SELECTION We have positioned the fund's portfolio around investment themes that indicate compelling growth opportunities. For example, we have focused on companies that stand to benefit from the adoption of technology in developing countries; cost savings through outsourcing; and key products, especially in semiconductors. In addition, we plan to continue to evaluate investments in wireless telecommunications based on growing trends in wireless voice and data communication. Wayne Collette has co-managed the Columbia Technology Fund since June 2002 and has been with the advisor or its predecessors or affiliate organizations since 2001. /s/ Wayne Collette Theodore Wendell has been with the advisor or its predecessors or affiliate organizations since 2000. Except for the period between June and August 2004, he has co-managed the fund since June 2002. /s/ Theodore Wendell Trent Nevills has co-managed the fund since August 2003 and has been with the advisor or its predecessors or affiliate organizations since 2003. /s/ Trent Nevills Equity investments are affected by stock market fluctuations that occur in response to economic and business developments. In addition, the fund's share price will likely be subject to more volatility than the overall stock market because it concentrates in technology stocks. International investing may involve certain risks, including foreign taxation, currency fluctuations, risks associated with possible differences in financial standards and other monetary and political risks. Some of the countries the fund invests in are considered emerging economies, which means there may be greater risks associated with investing there than in more developed countries. In addition, concentration of investments in a single region may result in greater volatility. 29 [sidebar] PERFORMANCE OF A $10,000 INVESTMENT 11/09/00 - 02/28/05 ($) SALES CHARGE WITHOUT WITH ----------------------------------------------- Class A 21,108 19,897 Class B 20,721 20,521 Class C 20,721 20,721 Class D 20,711 20,506 Class Z 21,242 n/a Performance data quoted represents past performance and current performance may be lower or higher. Past performance is no guarantee of future results. The investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than the original cost. Please visit www.columbiafunds.com for daily and most recent month-end performance updates. PERFORMANCE INFORMATION ________________________________________________________ Columbia Strategic Investor Fund VALUE OF A $10,000 INVESTMENT 11/09/00 - 02/28/05 [MOUNTIAN CHART] CLASS A CLASS A SHARES WITHOUT SHARES WITH RUSSELL 3000 SALES CHARGE SALES CHARGE VALUE INDEX S&P 500 INDEX -------------- ------------ ------------- ------------- 11/00 10000 9425 10000 10000 9790 9227 9730 9399 11224 10579 10253 9445 12274 11568 10308 9780 12254 11549 10040 8888 11984 11295 9699 8325 12934 12190 10172 8972 13743 12953 10403 9032 13963 13160 10218 8812 13884 13085 10182 8726 13664 12879 9799 8180 12325 11616 9082 7519 12736 12003 9024 7662 13896 13097 9558 8250 14568 13731 9808 8323 14599 13759 9747 8201 14719 13872 9766 8043 15591 14695 10248 8345 15521 14629 9951 7840 15541 14648 9970 7782 14900 14043 9426 7228 13636 12852 8510 6665 13676 12889 8567 6708 12311 11603 7639 5979 12894 12153 8172 6505 14141 13328 8696 6888 13310 12544 8318 6484 12945 12201 8115 6314 12681 11952 7895 6219 12620 11894 7913 6279 13827 13032 8613 6797 14982 14121 9192 7155 15125 14255 9310 7247 15601 14704 9472 7374 16169 15239 9634 7518 16037 15114 9539 7438 16928 15955 10137 7859 17294 16299 10294 7928 18117 17075 10908 8344 18503 17439 11114 8497 18941 17852 11351 8615 19002 17909 11271 8485 18666 17592 10971 8352 18675 17601 11084 8467 19224 18119 11369 8631 18582 17514 11178 8345 18694 17619 11334 8379 19151 18050 11532 8469 19274 18166 11722 8599 20301 19134 12353 8947 20912 19710 12756 9251 20448 19272 12506 9025 02/05 21108 19897 12909 9215 The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The Russell 3000 Value Index is an unmanaged index that measures the performance of those Russell 3000 Index companies with lower price-to-book ratios and lower forecasted growth values. The stocks in this index are also members of either the Russell 1000 Value or the Russell 2000 Value indexes. The Standard & Poor's (S&P) 500 Index is an unmanaged index that tracks the performance of 500 widely held, large-capitalization U.S. stocks. Unlike the fund, indices are not investments, do not incur fees or expenses and are not professionally managed. It is not possible to invest directly in an index. Securities in the fund may not match those in an index. Index performance is from November 9, 2000. AVERAGE ANNUAL TOTAL RETURN AS OF 02/28/05 (%)
SHARE CLASS A B C D Z -------------------------------------------------------------------------------------------------------------- INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 11/09/00 -------------------------------------------------------------------------------------------------------------- SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT -------------------------------------------------------------------------------------------------------------- 6-month (cumulative) 12.91 6.42 12.52 7.52 12.45 11.45 12.46 11.46 13.08 -------------------------------------------------------------------------------------------------------------- 1-year 11.46 5.05 10.63 5.63 10.63 9.63 10.70 9.70 11.75 -------------------------------------------------------------------------------------------------------------- Life 18.95 17.33 18.44 18.18 18.44 18.44 18.43 18.16 19.13
AVERAGE ANNUAL TOTAL RETURN AS OF 12/31/04 (%)
SHARE CLASS A B C D Z -------------------------------------------------------------------------------------------------------------- SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT -------------------------------------------------------------------------------------------------------------- 6-month (cumulative) 8.79 2.53 8.35 3.35 8.35 7.35 8.36 7.36 8.91 -------------------------------------------------------------------------------------------------------------- 1- year 15.45 8.81 14.53 9.53 14.59 13.59 14.61 13.61 15.70 -------------------------------------------------------------------------------------------------------------- Life 19.49 17.80 18.99 18.71 19.00 19.00 18.97 18.69 19.65
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF 5.75% FOR CLASS A SHARES, MAXIMUM CONTINGENT DEFERRED SALES CHARGE OF 5.00% FOR CLASS B SHARES AND 1.00% FOR CLASS C AND D SHARES FOR THE FIRST YEAR ONLY. THE "WITHOUT SALES CHARGE" RETURNS DO NOT INCLUDE THE EFFECT OF SALES CHARGES. IF THEY HAD, RETURNS WOULD BE LOWER. ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS. CLASS Z SHARES ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT SHARE CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES ASSOCIATED WITH EACH CLASS. Effective October 13, 2003, class D shares were closed to all new investors and new accounts. Existing class D shareholders will be able to make additional purchases at any time. In addition, class D initial sales charge of 1.00% is waived after October 13, 2003. Performance results reflect any voluntary waivers or reimbursement of fund expenses by the advisor or its affiliates. Absent these waivers or reimbursement arrangements, performance results would have been lower. Classes A, B and D (newer class shares) share performance information includes returns of the fund's class Z shares (the oldest existing fund class) for periods prior to the inception of the newer class shares. The returns for class C include the returns of class B prior to 10/13/03, the date on which class C was initially offered by the fund. The returns shown for class C also include the performance of class Z prior to the inception of class B (11/01/02). Class Z share returns are not restated to reflect any expense differential (e.g., Rule 12b-1 fees) between class Z shares and the newer class shares. Had the expense differential been reflected, the returns for the periods prior to the inception of classes A, B, C and D would have been lower. 30 [sidebar] ESTIMATING YOUR ACTUAL EXPENSES To estimate the expenses that you paid over the period, first you will need your account balance at the end of the period: o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611 o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE 1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6 2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD," LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1. YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING THE PERIOD UNDERSTANDING YOUR EXPENSES ____________________________________________________ Columbia Strategic Investor Fund As a fund shareholder, you incur two types of costs. There are transaction costs, which generally include sales charges on purchases and may include redemption or exchange fees. There are also ongoing costs, which generally include investment advisory fees, Rule 12b-1 fees, and other fund expenses. The information on this page is intended to help you understand your ongoing costs of investing in the fund and to compare these costs with the ongoing costs of investing in other mutual funds. ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS To illustrate these ongoing costs, we have provided an example and calculated the expenses paid by investors in each share class during the reporting period. The information in the following table is based on an initial investment of $1,000, which is invested at the beginning of the reporting period and held for the entire period. Expense information is calculated two ways and each method provides you with different information. The amount listed in the "actual" column is calculated using the fund's actual operating expenses and total return for the period. The amount listed in the "hypothetical" column for each share class assumes that the return each year is 5% before expenses and includes the fund's actual expense ratio. You should not use the hypothetical account values and expenses to estimate either your actual account balance at the end of the period or the expenses you paid during this reporting period. 09/01/04 - 02/28/05
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%) ------------------------------------------------------------------------------------------------------------------------- ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ------------------------------------------------------------------------------------------------------------------------- Class A 1,000.00 1,000.00 1,129.08 1,018.74 6.44 6.11 1.22 ------------------------------------------------------------------------------------------------------------------------- Class B 1,000.00 1,000.00 1,125.21 1,015.03 10.38 9.84 1.97 ------------------------------------------------------------------------------------------------------------------------- Class C 1,000.00 1,000.00 1,124.52 1,015.03 10.38 9.84 1.97 ------------------------------------------------------------------------------------------------------------------------- Class D 1,000.00 1,000.00 1,124.62 1,015.03 10.38 9.84 1.97 ------------------------------------------------------------------------------------------------------------------------- Class Z 1,000.00 1,000.00 1,130.82 1,019.98 5.12 4.86 0.97
Expenses paid during the period are equal to the fund's annualized expense ratio, multiplied by the average account value over the period, then multiplied by the number of days in the fund's most recent fiscal half-year and divided by 365. Had the Transfer Agent not waived a portion of expenses, total return would have been reduced. It is important to note that the expense amounts shown in the table are meant to highlight only ongoing costs of investing in the fund and do not reflect any transactional costs, such as sales charges, redemption or exchange fees. Therefore, the hypothetical examples provided may not help you determine the relative total costs of owning shares of different funds. If these transactional costs were included, your costs would have been higher. COMPARE WITH OTHER FUNDS Since all mutual fund companies are required to include the same hypothetical calculations about expenses in shareholder reports, you can use this information to compare the ongoing cost of investing in the fund with other funds. To do so, compare the 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds. As you compare hypothetical examples of other funds, it is important to note that hypothetical examples are meant to highlight the continuing cost of investing in a fund and do not reflect any transactional costs, such as sales charges or redemption or exchange fees. 31 [sidebar] SUMMARY o FOR THE SIX-MONTH PERIOD ENDED FEBRUARY 28, 2005, THE FUND'S CLASS A SHARES RETURNED 12.91% WITHOUT SALES CHARGE. o ALTHOUGH THE FUND TRAILED THE 13.88% RETURN OF THE RUSSELL 3000 VALUE INDEX, FUND PERFORMANCE WAS BETTER THAN THE 9.99% RETURN OF THE S&P 500 INDEX. FUND PERFORMANCE NEARLY MATCHED THE 12.93% AVERAGE RETURN OF ITS PEER GROUP, THE LIPPER MULTI-CAP VALUE FUND CATEGORY. o THE DECISION TO POSITION THE FUND CONSERVATIVELY BY MAINTAINING A SIGNIFICANT CASH POSITION HAMPERED RELATIVE PERFORMANCE COMPARED TO THE RUSSELL INDEX AND, WE BELIEVE, COMPARED TO OUR PEERS. [UP ARROW] [UP ARROW] RUSSELL 3000 CLASS A SHARES VALUE INDEX 12.91% 13.88% OBJECTIVE Seeks long-term growth of capital by using a "value" approach to investing primarily in common stocks. TOTAL NET ASSETS $501.1 million NET ASSET VALUE PER SHARE AS OF 02/28/05 ($) Class A 20.49 ----------------------------------------------- Class B 20.22 ----------------------------------------------- Class C 20.22 ----------------------------------------------- Class D 20.21 ----------------------------------------------- Class Z 20.53 DISTRIBUTIONS DECLARED PER SHARE 09/01/04 - 02/28/05 ($) Class A 0.25 ----------------------------------------------- Class B 0.22 ----------------------------------------------- Class C 0.22 ----------------------------------------------- Class D 0.22 ----------------------------------------------- Class Z 0.29 PORTFOLIO MANAGERS' REPORT _____________________________________________________ Columbia Strategic Investor Fund For the six-month period ended February 28, 2005, Columbia Strategic Investor Fund class A shares returned 12.91% without sales charge. While fund performance was not as strong as the 13.88% return of Russell 3000 Value Index, it did outpace the 9.99% return of S&P 500 Index. Fund performance was slightly behind the 12.93% average return of its peer group, the Lipper Multi-Cap Value Fund Category. 1 Our decision to position the fund conservatively by maintaining a significant cash position hampered fund performance relative to the Russell Index and, we believe, compared to our peers. A BOOST FROM STRONG COMMODITY PRICES Companies in the energy and materials sectors benefited from higher commodity prices caused by an increase in demand, especially from emerging markets, as well as constraints on supply. During the period, the fund benefited from exposure to both sectors. In the energy sector, oil service and offshore exploration companies did well as demand for their services increased: Transocean and TGS Nopec Geophysical returned 57.9% and 72.4% respectively. One exception to the strong performance in the energy sector was Input/Output, a provider of seismic equipment, software and processing services to the oil and gas industry, which suffered a revenue disappointment and returned negative 25% for the period. We still are hopeful about the long-term prospects for the company and maintained our position. In the materials sector, commodity producers also made gains. Potash Corp. of Saskatchewan experienced higher prices and demand for potash, a fertilizer, and gained 61%. Companhia Vale do Rio Doce, a Brazilian iron ore producer, advanced 83%. The fund also invested in the industrials sector, where among other things, we looked for companies that stand to benefit from a favorable environment for commodities. Caterpillar shares gained 32% and Bucyrus International, a manufacturer of mining equipment, saw its stock price increase 65%. On the downside, Central Parking declined in September on lower-than-anticipated earnings, which resulted from lower revenues and higher-than-forecasted operating costs. We continued to hold the stock as we found its valuation attractive. CONSUMER DISCRETIONARY STOCKS The fund also benefited from its exposure to the consumer discretionary sector. Retail sales at CarMax grew steadily as a result of low prices, broad selection and a focus on customer satisfaction. This specialty retailer of used cars saw a gain of 69% in its share price. In addition, several foreign stocks performed exceptionally well during the period, including Nokian Renkaat Oyj, a Finnish tire manufacturer. Nokian Renkaat Oyj experienced healthy sales and its stock gained 73% during the past six months. 1 Lipper Inc., a widely respected data provider in the industry, calculates an average total return for mutual funds with similar investment objectives as those of the fund. 32 [sidebar] TOP 5 SECTORS AS OF 02/28/05 (%) Financials 11.1 ----------------------------------------------- Industrials 10.8 ----------------------------------------------- Health care 10.7 ----------------------------------------------- Energy 9.9 ----------------------------------------------- Consumer discretionary 9.2 TOP 10 HOLDINGS AS OF 02/28/05 (%) 3M 1.0 ----------------------------------------------- Transocean 1.0 ----------------------------------------------- Nokian Renkaat Oyj 0.9 ----------------------------------------------- Potash Corp. of Saskatchewan 0.9 ----------------------------------------------- JPMorgan Chase 0.9 ----------------------------------------------- Schlumberger 0.9 ----------------------------------------------- Companhia Vale do Rio Doce 0.8 ----------------------------------------------- Samsung Electronics 0.8 ----------------------------------------------- Morgan Stanley 0.8 ----------------------------------------------- Exxon Mobil 0.8 HOLDINGS DISCUSSED IN THIS REPORT AS OF 02/28/05 (%) Transocean 1.0 ----------------------------------------------- TGS Nopec Geophysical 0.7 ----------------------------------------------- Input/Output 0.3 ----------------------------------------------- Potash Corp. of Saskatchewan 0.9 ----------------------------------------------- Companhia Vale do Rio Doce 0.8 ----------------------------------------------- Caterpillar 0.6 ----------------------------------------------- Bucyrus International 0.2 ----------------------------------------------- Central Parking 0.1 ----------------------------------------------- CarMax 0.3 ----------------------------------------------- Nokian Renkaat Oyj 0.9 ----------------------------------------------- Accredo Health 0.3 ----------------------------------------------- Biogen Idec 0.2 ----------------------------------------------- Elan 0.1 ----------------------------------------------- Pfizer 0.3 Your fund is actively managed and the composition of its portfolio will change over time. Information provided is calculated as a percentage of net assets. ________________________________________________________________________________ Columbia Strategic Investor Fund MIXED RESULTS FROM HEALTH CARE Within the health care sector, the fund experienced both substantial gains as well as some significant disappointments. Accredo Health, a health care and pharmaceutical services company, rose 93% during the period after news of its acquisition by Medco Health Services. On the downside, Biogen Idec and Elan announced a voluntary suspension in the marketing of Tysabri, a treatment for multiple sclerosis (MS) and declined 35% and 65%, respectively, for the period. In addition, Pfizer struggled as new risks were revealed about a popular pain management drug and as litigation and patent expiration risks increased. PUT CASH TO WORK GRADUALLY Consistent with our conservative approach, we maintained a significant cash position during this six-month period. We remain cautious about putting cash to work too quickly as we prefer to dampen volatility in the fund amid uncertainty about a potential slowing in the economy in fiscal 2006. As the current economic recovery matures, we plan to seek companies that are less sensitive to economic cycles and demonstrate the potential to maintain stable growth. In addition, we will continue to evaluate investment opportunities overseas, considering areas with compelling growth trends and reasonable prices. [Photo of Robert A. Unger] Robert A. Unger, CFA, has managed or co-managed Columbia Strategic Investor Fund since November 2000 and has been with the advisor or its predecessors or affiliate organizations since 1984. /s/ Robert A. Unger [Photo of Emil A. Gjester] Emil A. Gjester has served as an assistant portfolio manager or co-portfolio manager of the fund since November 2002 and has been with the advisor or its predecessors or affiliate organizations since 1996. /s/ Emil A. Gjester Equity investments are affected by stock market fluctuations that occur in response to economic and business developments. 33 [sidebar] PERFORMANCE OF A $10,000 INVESTMENT 03/01/95 - 02/28/05 ($) SALES CHARGE WITHOUT WITH ----------------------------------------------- Class A 21,587 20,350 ----------------------------------------------- Class B 21,213 21,213 ----------------------------------------------- Class C 21,214 21,214 ----------------------------------------------- Class D 21,242 21,032 ----------------------------------------------- Class Z 21,776 n/a Performance data quoted represents past performance and current performance may be lower or higher. Past performance is no guarantee of future results. The investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than the original cost. Please visit www.columbiafunds.com for daily and most recent month-end performance updates. PERFORMANCE INFORMATION ________________________________________________________ Columbia Balanced Fund VALUE OF A $10,000 INVESTMENT 03/01/95 - 02/28/05 [MOUNTAIN CHART] LEHMAN CLASS A CLASS A BROTHERS SHARES WITHOUT SHARES WITH S&P 500 AGGREGATE SALES CHARGE SALES CHARGE INDEX BOND INDEX -------------- ------------ -------- ---------- 03/95 10000 9425 10000 10000 10144 9561 10295 10061 10272 9681 10598 10202 10628 10017 11022 10597 10767 10148 11277 10674 10975 10344 11652 10651 11094 10456 11681 10779 11347 10694 12174 10884 11330 10678 12130 11025 11665 10994 12662 11191 11940 11254 12907 11348 12090 11394 13346 11422 12084 11389 13470 11224 12179 11479 13599 11145 12227 11524 13799 11083 12346 11636 14155 11061 12461 11745 14209 11209 12207 11505 13581 11239 12401 11688 13867 11220 12777 12042 14648 11415 12929 12185 15052 11669 13490 12714 16190 11868 13348 12581 15870 11758 13677 12890 16862 11794 13716 12928 16993 11824 13511 12734 16295 11692 13889 13090 17267 11868 14353 13528 18319 11981 14783 13933 19140 12123 15626 14728 20663 12450 15151 14280 19506 12345 15580 14684 20575 12526 15404 14518 19888 12708 15707 14804 20809 12766 15849 14937 21167 12895 16070 15146 21402 13060 16633 15677 22945 13050 17107 16123 24119 13094 17204 16215 24363 13162 17130 16145 23944 13287 17704 16686 24916 13400 17630 16616 24652 13428 16306 15368 21087 13647 16862 15892 22439 13966 17408 16407 24263 13892 18052 17014 25734 13972 19031 17937 27216 14014 19573 18448 28353 14113 19139 18038 27472 13866 19763 18626 28571 13942 19952 18805 29676 13987 19563 18438 28976 13864 20232 19069 30584 13819 19832 18691 29630 13760 19598 18471 29485 13753 19506 18384 28677 13913 20110 18954 30492 13964 20539 19358 31111 13963 21444 20211 32943 13896 20949 19745 31290 13850 21557 20317 30698 14018 22928 21609 33701 14203 22448 21158 32686 14161 21889 20631 32016 14154 22614 21314 32807 14449 22544 21248 32295 14580 23511 22159 34301 14792 22519 21224 32490 14885 22186 20910 32353 14983 21247 20025 29804 15229 21623 20380 29950 15512 22019 20753 31013 15766 20634 19447 28185 15904 19928 18782 26398 15983 20791 19596 28449 15916 20887 19686 28639 16011 20592 19408 27943 16072 20535 19354 27670 16432 19789 18651 25937 16621 18796 17715 23842 16816 19160 18059 24297 17167 19912 18767 26161 16930 20023 18872 26391 16822 19743 18608 26006 16958 19569 18444 25504 17123 19851 18709 26463 16838 19188 18084 24859 17165 19257 18150 24675 17311 18448 17387 22918 17460 17505 16499 21133 17671 17742 16722 21270 17970 16750 15787 18958 18261 17393 16393 20626 18177 18066 17027 21841 18171 17427 16425 20559 18548 17198 16209 20021 18564 17099 16115 19720 18820 17169 16182 19912 18805 18048 17010 21552 18962 18667 17593 22688 19314 18769 17690 22978 19276 18800 17719 23383 18628 19230 18124 23839 18751 19161 18059 23586 19248 19805 18666 24921 19069 19975 18826 25140 19115 20578 19395 26458 19309 20770 19575 26945 19464 21112 19898 27319 19674 20945 19741 26907 19822 20388 19216 26484 19306 20560 19377 26847 19229 20819 19622 27368 19339 20127 18970 26462 19530 20188 19027 26568 19903 20384 19212 26855 19957 20618 19433 27266 20125 21210 19990 28370 19964 21884 20626 29335 20147 21453 20220 28619 20274 02/05 21587 20350 29212 20158 The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The Lehman Brothers Aggregate Bond Index is a market value-weighted index that tracks the daily price, coupon, pay-downs, and total return performance of fixed-rate, publicly placed, dollar-denominated, and non-convertible investment grade debt issues with at least $250 million par amount outstanding and with at least one year to final maturity. The Standard & Poor's (S&P) 500 Index is an unmanaged index that tracks the performance of 500 widely held, large-capitalization U.S. stocks. Unlike the fund, indices are not investments, do not incur fees or expenses and are not professionally managed. It is not possible to invest directly in an index. Securities in the fund may not match those in an index. AVERAGE ANNUAL TOTAL RETURN AS OF 02/28/05 (%)
SHARE CLASS A B C D Z ------------------------------------------------------------------------------------------------------------- INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 10/01/91 ------------------------------------------------------------------------------------------------------------- SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT ------------------------------------------------------------------------------------------------------------- 6-month (cumulative) 6.94 0.79 6.55 1.55 6.55 5.55 6.61 5.61 7.13 ------------------------------------------------------------------------------------------------------------- 1-year 2.27 -3.61 1.46 -3.54 1.46 0.46 1.51 0.51 2.52 ------------------------------------------------------------------------------------------------------------- 5-year 0.03 -1.16 -0.32 -0.67 -0.32 -0.32 -0.30 -0.50 0.20 ------------------------------------------------------------------------------------------------------------- 10-year 8.00 7.36 7.81 7.81 7.81 7.81 7.82 7.72 8.09
AVERAGE ANNUAL TOTAL RETURN AS OF 12/31/04 (%)
SHARE CLASS A B C D Z ------------------------------------------------------------------------------------------------------------- SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT ------------------------------------------------------------------------------------------------------------- 6-month (cumulative) 5.13 -0.91 4.74 -0.26 4.74 3.74 4.75 3.75 5.26 ------------------------------------------------------------------------------------------------------------- 1-year 6.37 0.26 5.53 0.53 5.53 4.53 5.54 4.54 6.64 ------------------------------------------------------------------------------------------------------------- 5-year 0.41 -0.78 0.08 -0.26 0.08 0.08 0.10 -0.10 0.57 ------------------------------------------------------------------------------------------------------------- 10-year 8.65 8.01 8.48 8.48 8.48 8.48 8.48 8.38 8.74
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF 5.75% FOR CLASS A SHARES, MAXIMUM CONTINGENT DEFERRED SALES CHARGE OF 5.00% FOR CLASS B SHARES AND 1.00% FOR CLASS C AND D SHARES FOR THE FIRST YEAR ONLY. THE "WITHOUT SALES CHARGE" RETURNS DO NOT INCLUDE THE EFFECT OF SALES CHARGES. IF THEY HAD, RETURNS WOULD BE LOWER. ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS. CLASS Z SHARES ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT SHARE CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES ASSOCIATED WITH EACH CLASS. Effective October 13, 2003, class D shares were closed to all new investors and new accounts. Existing class D shareholders will be able to make additional purchases at any time. In addition, class D initial sales charge of 1.00% is waived after October 13, 2003. Performance results reflect any voluntary waivers or reimbursement of fund expenses by the advisor or its affiliates. Absent these waivers or reimbursement arrangements, performance results would have been lower. Classes A, B and D (newer class shares) share performance information includes returns of the fund's class Z shares (the oldest existing fund class) for periods prior to the inception of the newer class shares. The returns for class C include the returns of class B prior to 10/13/03, the date on which class C was initially offered by the fund. The returns shown for class C also include the performance of class Z prior to the inception of class B (11/01/02). Class Z share returns are not restated to reflect any expense differential (e.g., Rule 12b-1 fees) between class Z shares and the newer class shares. Had the expense differential been reflected, the returns for the periods prior to the inception of classes A, B, C and D would have been lower. 34 [sidebar] ESTIMATING YOUR ACTUAL EXPENSES To estimate the expenses that you paid over the period, first you will need your account balance at the end of the period: o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611 o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE 1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6 2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD," LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1. YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING THE PERIOD UNDERSTANDING YOUR EXPENSES ____________________________________________________ Columbia Balanced Fund As a fund shareholder, you incur two types of costs. There are transaction costs, which generally include sales charges on purchases and may include redemption or exchange fees. There are also ongoing costs, which generally include investment advisory fees, Rule 12b-1 fees, and other fund expenses. The information on this page is intended to help you understand your ongoing costs of investing in the fund and to compare these costs with the ongoing costs of investing in other mutual funds. ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS To illustrate these ongoing costs, we have provided an example and calculated the expenses paid by investors in each share class during the reporting period. The information in the following table is based on an initial investment of $1,000, which is invested at the beginning of the reporting period and held for the entire period. Expense information is calculated two ways and each method provides you with different information. The amount listed in the "actual" column is calculated using the fund's actual operating expenses and total return for the period. The amount listed in the "hypothetical" column for each share class assumes that the return each year is 5% before expenses and includes the fund's actual expense ratio. You should not use the hypothetical account values and expenses to estimate either your actual account balance at the end of the period or the expenses you paid during this reporting period. 09/01/04 - 02/28/05
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%) ----------------------------------------------------------------------------------------------------------------------- ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ----------------------------------------------------------------------------------------------------------------------- Class A 1,000.00 1,000.00 1,069.42 1,019.69 5.28 5.16 1.03 Class B 1,000.00 1,000.00 1,065.51 1,015.97 9.12 8.90 1.78 Class C 1,000.00 1,000.00 1,065.51 1,015.97 9.12 8.90 1.78 Class D 1,000.00 1,000.00 1,066.10 1,015.97 9.12 8.90 1.78 Class Z 1,000.00 1,000.00 1,071.31 1,020.93 4.01 3.91 0.78
Expenses paid during the period are equal to the fund's annualized expense ratio, multiplied by the average account value over the period, then multiplied by the number of days in the fund's most recent fiscal half-year and divided by 365. It is important to note that the expense amounts shown in the table are meant to highlight only ongoing costs of investing in the fund and do not reflect any transactional costs, such as sales charges, redemption or exchange fees. Therefore, the hypothetical examples provided may not help you determine the relative total costs of owning shares of different funds. If these transactional costs were included, your costs would have been higher. COMPARE WITH OTHER FUNDS Since all mutual fund companies are required to include the same hypothetical calculations about expenses in shareholder reports, you can use this information to compare the ongoing cost of investing in the fund with other funds. To do so, compare the 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds. As you compare hypothetical examples of other funds, it is important to note that hypothetical examples are meant to highlight the continuing cost of investing in a fund and do not reflect any transactional costs, such as sales charges or redemption or exchange fees. 35 [sidebar] SUMMARY o FOR THE SIX-MONTH PERIOD ENDED FEBRUARY 28, 2005, THE FUND'S CLASS A SHARES RETURNED 6.94% WITHOUT SALES CHARGE. o THE FUND'S RETURN FELL BETWEEN THE RETURN OF ITS BENCHMARKS, THE S&P 500 INDEX AND THE LEHMAN BROTHERS AGGREGATE INDEX. THE FUND TRAILED THE AVERAGE RETURN OF ITS PEER GROUP, THE LIPPER BALANCED FUNDS CATEGORY. WE BELIEVE THIS CATEGORY INCLUDED FUNDS WITH A HIGHER PORTION OF EQUITIES IN THEIR PORTFOLIOS. o GOOD STOCK SELECTION AND EXPOSURE TO CORPORATE BONDS HELPED THE FUND. AMONG THE FUND'S EQUITY HOLDINGS THE FOLLOWING SECTORS WERE LEADING CONTRIBUTORS TO RELATIVE PERFORMANCE: CONSUMER DISCRETIONARY, ENERGY, INFORMATION TECHNOLOGY AND HEALTH CARE. [UP ARROW] [UP ARROW] S&P 500 CLASS A SHARES INDEX 6.94% 9.99% OBJECTIVE Seeks high total return by investing in common stocks and debt securities. TOTAL NET ASSETS $385.2 million NET ASSET VALUE PER SHARE AS OF 02/28/05 ($) Class A 21.01 ----------------------------------------------- Class B 20.98 ----------------------------------------------- Class C 20.98 ----------------------------------------------- Class D 20.98 ----------------------------------------------- Class Z 21.00 DISTRIBUTIONS DECLARED PER SHARE 09/01/04 - 02/28/05 ($) Class A 0.22 ----------------------------------------------- Class B 0.15 ----------------------------------------------- Class C 0.15 ----------------------------------------------- Class D 0.15 ----------------------------------------------- Class Z 0.25 PORTFOLIO MANAGERS' REPORT _____________________________________________________ Columbia Balanced Fund For the six-month period ended February 25, 2005, Columbia Balanced Fund class A shares returned 6.94% without sales charge. The fund's return fell between the returns of the Lehman Brothers Aggregate Bond Index, which returned 1.26%, and the S&P 500 Index, which returned 9.99%. The fund's return trailed the 7.69% average return of Lipper Balanced Funds Category, which we believe included funds with more exposure to equities. 1 During the six-month period, the fund's asset mix remained at or near its upper limit of 65% for equity investments and 35% for fixed-income. The fund was well positioned for an environment characterized by good growth in GDP and rising interest rates. The fund's equity return closely tracked the benchmark S&P 500 Index, while the fixed-income portfolio outperformed its Lehman benchmark. GOOD STOCK SELECTION IN MANY SECTORS AIDED PERFORMANCE Good stock selection helped the fund's performance, especially in the consumer discretionary, energy, information technology and health care groups, which were the largest contributors to positive performance. Many companies across these industries produced double-digit gains for the fund. The fund's consumer discretionary and health care holdings outperformed S&P 500 Index returns for those sectors. Energy stocks were the best performers during this period. However, the fund had less exposure to energy than its benchmark, and its underweight in the sector held back fund performance. ACQUISITIONS AND OPPORTUNISTIC STYLE ADD VALUE During the period, the fund had positions in several companies whose attributes made them attractive take-over candidates. Acquisition announcements spurred gains in stock prices for Sears Roebuck, May Department Stores and International Steel Group. We eliminated our position in Sears by the end of the period. The fund's opportunistic style also figured into the fund's gains during the period. When new management took over the fund in August, 2004, we adopted a more contrarian approach to stock selection, seeking companies that appeared to offer opportunity because they were generally out of favor with investors or, by contrast, avoiding companies because investors had become overly enthusiastic about their prospects. One case in point was Jacobs Engineering Group. The company fell out of favor after some operational concerns, but we believed it had the potential to get back on track. We also believed the company was poised to benefit from the robust activity in commercial construction. The company delivered on both fronts and it was one of the fund's best performers for the period. Similarly, we added to semiconductor holdings after the information technology group had been severely punished. We felt that weakness in these stocks primarily reflected inventory corrections in the industry. With capacity utilization rates at 85%, good global growth and demand, semiconductor stocks rose and helped the fund's return. In contrast, news that insurance broker Marsh McLennan and technology company Nortel Networks were caught up in accounting issues sent their shares down sharply. We eliminated our position in Marsh McLennan by the end of the reporting period. However, we are maintaining a position in Nortel because we believe the company will soon resolve its issues. 1 Lipper Inc., a widely respected data provider in the industry, calculates an average total return for mutual funds with similar investment objectives as those of the fund. 36 [sidebar] PORTFOLIO COMPOSITION AS OF 02/28/05 (%) Common stocks 58.8 ----------------------------------------------- Mortgage-backed obligations 14.5 ----------------------------------------------- Corporate fixed-income bonds & notes 13.8 ----------------------------------------------- Government agencies & obligations 5.7 ----------------------------------------------- Collateralized mortgage obligations 3.7 ----------------------------------------------- Asset-backed securities 1.1 ----------------------------------------------- Cash & cash equivalents, net receivables & payables 2.4 TOP 10 EQUITY HOLDINGS AS OF 02/28/05 (%) MGIC Investment 1.5 ----------------------------------------------- Microsoft 1.5 ----------------------------------------------- E.I. du Pont de Nemours 1.4 ----------------------------------------------- SanDisk 1.4 ----------------------------------------------- Barr Pharmaceuticals 1.3 ----------------------------------------------- UnumProvident 1.3 ----------------------------------------------- Intel 1.2 ----------------------------------------------- International Business Machines 1.2 ----------------------------------------------- Time Warner 1.2 ----------------------------------------------- Comcast 1.2 HOLDINGS DISCUSSED IN THIS REPORT AS OF 02/28/05 (%) May Department Stores 0.6 ----------------------------------------------- International Steel Group 0.9 ----------------------------------------------- Jacobs Engineering Group 0.4 ----------------------------------------------- Nortel Networks 0.7 Your fund is actively managed and the composition of its portfolio will change over time. Information provided is calculated as a percentage of net assets. ________________________________________________________________________________ Columbia Balanced Fund CORPORATE BONDS PROPEL FIXED INCOME GAINS Performance within the fixed-income portion of the fund was aided by overweight positions in corporate bonds, which outperformed Treasury securities during the period. Continuing a two-year trend, investors appeared to be willing to take on additional risk in pursuit of higher yields. This period also saw a particularly strong high-yield market. The fund's modest position in these securities also contributed to positive relative performance. MIXED RESULTS FROM FUND'S POSITIONING RELATIVE TO FED ACTIONS The Federal Reserve Board (the Fed) continued to manage the economy's growth by raising short-term interest rates. In response, we avoided securities with maturities between two and three years, which were rendered less competitive as the yields for one-year and shorter-term securities moved higher. However, we missed out on some of the gains in longer-term bonds because we were slightly underweight in this maturity range when yields declined and prices rose. We maintained a relatively light exposure to long-term bonds because we believed that their yields would also rise, but that was not the case during this reporting period. However, the fund's overweight position in mortgage-backed securities gave a decisive boost to performance. STRONG ECONOMY UNDERPINS INVESTMENT CHALLENGES Given the overall health of the economy, we plan to maintain significant equity exposure in the fund. And because we believe that the economy's fundamental strength and judicious rate increases by the Fed continue to bode well for corporate bonds, we plan to maintain our significant exposure to the sector. Columbia Balanced Fund is managed by a group of managers from Columbia's large cap core team: /s/ John Maack /s/ Guy W. Pope John Maack Guy W. Pope, CFA and Columbia's bond team: /s/ Leonard A. Aplet /s/ Jeffrey L. Rippey Leonard A. Aplet, CFA Jeffrey L. Rippey, CFA Equity investments are affected by stock market fluctuations that occur in response to economic and business developments. Investing in fixed-income securities may involve certain risks, including the credit quality of individual issuers, possible prepayments, market or economic developments and yield and share price fluctuations due to changes in interest rates. When interest rates go up, bond prices typically drop, and vice versa. Investing in high-yield securities (commonly known as "junk bonds") offers the potential for high current income and attractive total returns but involves certain risks. Changes in economic conditions or other circumstances may adversely affect a junk bond issuer's ability to make principal and interest payments. Rising interest rates tend to lower the value of all bonds. 37 [sidebar] PERFORMANCE OF A $10,000 INVESTMENT 03/01/95 - 02/28/05 ($) SALES CHARGE WITHOUT WITH ----------------------------------------------- Class A 16,248 15,483 ----------------------------------------------- Class B 15,958 15,958 ----------------------------------------------- Class C 16,086 16,086 ----------------------------------------------- Class D 16,184 16,026 ----------------------------------------------- Class G 16,041 16,041 ----------------------------------------------- Class T 16,287 15,520 ----------------------------------------------- Class Z 16,357 n/a Performance data quoted represents past performance and current performance may be lower or higher. Past performance is no guarantee of future results. The investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than the original cost. Please visit www.columbiafunds.com for daily and most recent month-end performance updates. PERFORMANCE INFORMATION ________________________________________________________ Columbia Short Term Bond Fund VALUE OF A $10,000 INVESTMENT 03/01/95 - 02/28/05 [MOUNTAIN CHART] MERRILL LYNCH MERRILL LYNCH 1-5 YEAR CLASS A CLASS A 1-3 YEAR GOVERNMENT/ SHARES WITHOUT SHARES WITH TREASURY CORPORATE BOND SALES CHARGE SALES CHARGE INDEX INDEX -------------- ------------ ------------- --------------- 03/95 10000 9525 10000 10000 10051 9574 10056 10060 10137 9656 10145 10164 10300 9810 10323 10401 10346 9855 10379 10464 10378 9885 10421 10491 10436 9940 10484 10563 10481 9983 10535 10624 10579 10076 10624 10728 10687 10180 10717 10841 10771 10259 10800 10939 10867 10351 10892 11036 10790 10277 10846 10960 10741 10231 10836 10930 10730 10221 10845 10919 10736 10226 10867 10926 10819 10305 10946 11020 10854 10338 10988 11060 10875 10358 11026 11086 10989 10467 11126 11208 11120 10591 11252 11363 11207 10675 11338 11474 11187 10656 11338 11445 11234 10701 11392 11496 11250 10716 11418 11516 11217 10684 11413 11488 11321 10783 11507 11598 11384 10843 11585 11683 11459 10915 11665 11774 11592 11041 11793 11947 11584 11034 11804 11930 11659 11105 11894 12041 11750 11192 11982 12150 11755 11196 12011 12173 11832 11270 12092 12263 11952 11384 12210 12406 11938 11371 12221 12404 11971 11402 12271 12452 12032 11460 12328 12511 12095 11520 12394 12587 12142 11565 12458 12660 12190 11611 12517 12717 12355 11768 12674 12902 12533 11937 12842 13132 12594 11996 12905 13175 12549 11953 12893 13156 12594 11996 12938 13205 12637 12037 12990 13271 12538 11943 12926 13151 12625 12025 13015 13259 12650 12049 13057 13303 12616 12017 13049 13251 12656 12055 13090 13289 12683 12080 13132 13304 12694 12091 13170 13331 12768 12161 13255 13439 12782 12175 13291 13470 12795 12187 13316 13491 12819 12210 13335 13494 12807 12199 13330 13464 12887 12275 13419 13560 12938 12324 13502 13666 12973 12357 13537 13675 13027 12408 13593 13715 13128 12505 13734 13896 13183 12557 13821 13994 13272 12641 13923 14125 13327 12694 14023 14252 13385 12749 14099 14316 13533 12890 14233 14480 13751 13098 14402 14690 13920 13259 14582 14903 14034 13368 14677 15020 14137 13465 14799 15156 14152 13480 14839 15165 14235 13558 14922 15255 14284 13606 14973 15311 14503 13814 15140 15556 14620 13926 15228 15670 14818 14114 15479 15950 14999 14286 15626 16139 14901 14193 15592 16042 14864 14158 15598 16008 14919 14210 15629 16055 14986 14274 15704 16154 14900 14193 15598 15993 15081 14364 15772 16213 15173 14452 15835 16338 15262 14537 15968 16480 15352 14623 16163 16691 15461 14727 16218 16833 15622 14880 16353 17047 15538 14800 16390 17045 15541 14803 16340 17014 15682 14937 16495 17275 15701 14955 16493 17283 15825 15073 16563 17435 15839 15087 16592 17470 15901 15146 16624 17549 16020 15259 16687 17737 16027 15266 16712 17760 15791 15041 16622 17531 15810 15059 16633 17541 15978 15219 16785 17820 15927 15170 16723 17711 15916 15160 16714 17710 16016 15255 16811 17844 16062 15299 16845 17910 16109 15344 16926 18039 16173 15405 16978 18140 16031 15269 16815 17857 15981 15222 16800 17811 15991 15231 16798 17830 16058 15295 16859 17934 16164 15396 16975 18135 16177 15408 16960 18135 16225 15455 17013 18218 16183 15415 16927 18092 16237 15465 16963 18163 16253 15481 16956 18156 02/05 16248 15483 16913 18087 The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The Merrill Lynch 1-3 Year Treasury Index is an unmanaged index that measures the return of Treasury notes and bonds with maturities of 1-3 years and a minimum amount outstanding of $1 billion. The Merrill Lynch 1-5 Year Government/Corporate Bond Index is an unmanaged index that includes all US government debt with at least $100 million face value outstanding, as well as investment-grade rated corporate debt with at least $100 million face value outstanding and a maturity of 1-5 years. Unlike the fund, indices are not investments, do not incur fees or expenses and are not professionally managed. It is not possible to invest directly in an index. Securities in the fund may not match those in an index. AVERAGE ANNUAL TOTAL RETURN AS OF 02/28/05 (%)
SHARE CLASS A B C D G T Z ------------------------------------------------------------------------------------------------------------------------------ INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 11/01/02 11/01/02 11/06/86 ------------------------------------------------------------------------------------------------------------------------------ SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT ------------------------------------------------------------------------------------------------------------------------------ 6-month (cumulative) 0.54 -4.23 0.16 -4.80 0.47 -0.52 0.47 -0.53 0.26 -4.70 0.59 -4.18 0.66 ------------------------------------------------------------------------------------------------------------------------------ 1-year 0.89 -3.86 0.11 -4.82 0.76 -0.23 0.72 -0.26 0.32 -4.61 0.97 -3.79 1.14 ------------------------------------------------------------------------------------------------------------------------------ 5-year 4.75 3.73 4.37 4.03 4.54 4.54 4.66 4.46 4.48 3.97 4.80 3.78 4.89 ------------------------------------------------------------------------------------------------------------------------------ 10-year 4.97 4.47 4.78 4.78 4.87 4.87 4.93 4.83 4.84 4.84 5.00 4.49 5.04
AVERAGE ANNUAL TOTAL RETURN AS OF 12/31/04 (%)
SHARE CLASS A B C D G T Z ------------------------------------------------------------------------------------------------------------------------------ SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT ------------------------------------------------------------------------------------------------------------------------------ 6-month (cumulative) 1.53 -3.32 1.13 -3.87 1.46 0.46 1.44 0.44 1.24 -3.76 1.57 -3.28 1.65 ------------------------------------------------------------------------------------------------------------------------------ 1-year 1.38 -3.41 0.60 -4.36 1.17 0.18 1.21 0.22 0.81 -4.15 1.46 -3.33 1.63 ------------------------------------------------------------------------------------------------------------------------------ 5-year 4.84 3.82 4.48 4.15 4.63 4.63 4.76 4.56 4.59 4.08 4.88 3.86 4.97 ------------------------------------------------------------------------------------------------------------------------------ 10-year 5.20 4.69 5.03 5.03 5.10 5.10 5.17 5.06 5.08 5.08 5.23 4.72 5.27
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF 4.75% FOR CLASS A AND T SHARES, MAXIMUM CONTINGENT DEFERRED SALES CHARGE OF 5.00% FOR CLASS B AND G SHARES AND 1.00% FOR CLASS C AND D SHARES FOR THE FIRST YEAR ONLY. THE "WITHOUT SALES CHARGE" RETURNS DO NOT INCLUDE THE EFFECT OF SALES CHARGES. IF THEY HAD, RETURNS WOULD BE LOWER. ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS. CLASS Z SHARES ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT SHARE CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES ASSOCIATED WITH EACH CLASS. Effective October 13, 2003, class D shares were closed to all new investors and new accounts. Existing class D shareholders will be able to make additional purchases at any time. In addition, class D initial sales charge of 1.00% is waived after October 13, 2003. Performance results reflect any voluntary waivers or reimbursement of fund expenses by the advisor or its affiliates. Absent these waivers or reimbursement arrangements, performance results would have been lower. Classes A, B, D, G and T (newer class shares) share performance information includes returns of the fund's class Z shares (the oldest existing fund class) for periods prior to the inception of the newer class shares. The returns for class C include the returns of class B prior to 10/13/03, the date on which class C was initially offered by the fund. The returns shown for class C also include the performance of class Z prior to the inception of class B (11/01/02). Class Z share returns are not restated to reflect any expense differential (e.g., Rule 12b-1 fees) between class Z shares and the newer class shares. Had the expense differential been reflected, the returns for the periods prior to the inception of classes A, B, C, D, G and T would have been lower. 38 [sidebar] ESTIMATING YOUR ACTUAL EXPENSES To estimate the expenses that you paid over the period, first you will need your account balance at the end of the period: o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611 o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE 1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6 2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD," LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1. YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING THE PERIOD UNDERSTANDING YOUR EXPENSES ____________________________________________________ Columbia Short Term Bond Fund As a fund shareholder, you incur two types of costs. There are transaction costs, which generally include sales charges on purchases and may include redemption or exchange fees. There are also ongoing costs, which generally include investment advisory fees, Rule 12b-1 fees, and other fund expenses. The information on this page is intended to help you understand your ongoing costs of investing in the fund and to compare these costs with the ongoing costs of investing in other mutual funds. ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS To illustrate these ongoing costs, we have provided an example and calculated the expenses paid by investors in each share class during the reporting period. The information in the following table is based on an initial investment of $1,000, which is invested at the beginning of the reporting period and held for the entire period. Expense information is calculated two ways and each method provides you with different information. The amount listed in the "actual" column is calculated using the fund's actual operating expenses and total return for the period. The amount listed in the "hypothetical" column for each share class assumes that the return each year is 5% before expenses and includes the fund's actual expense ratio. You should not use the hypothetical account values and expenses to estimate either your actual account balance at the end of the period or the expenses you paid during this reporting period. 09/01/04 - 02/28/05
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%) ---------------------------------------------------------------------------------------------------------------------- ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ---------------------------------------------------------------------------------------------------------------------- Class A 1,000.00 1,000.00 1,005.41 1,020.38 4.43 4.46 0.89 ---------------------------------------------------------------------------------------------------------------------- Class B 1,000.00 1,000.00 1,001.59 1,016.66 8.14 8.20 1.64 ---------------------------------------------------------------------------------------------------------------------- Class C 1,000.00 1,000.00 1,004.71 1,019.64 5.17 5.21 1.04 ---------------------------------------------------------------------------------------------------------------------- Class D 1,000.00 1,000.00 1,004.71 1,019.64 5.17 5.21 1.04 ---------------------------------------------------------------------------------------------------------------------- Class G 1,000.00 1,000.00 1,002.58 1,017.65 7.15 7.20 1.44 ---------------------------------------------------------------------------------------------------------------------- Class T 1,000.00 1,000.00 1,005.90 1,020.88 3.93 3.96 0.79 ---------------------------------------------------------------------------------------------------------------------- Class Z 1,000.00 1,000.00 1,006.60 1,021.62 3.18 3.21 0.64
Expenses paid during the period are equal to the fund's annualized expense ratio, multiplied by the average account value over the period, then multiplied by the number of days in the fund's most recent fiscal half-year and divided by 365. Had the Investment Advisor and/or Distributor not reimbursed a portion of expenses, total return would have been reduced. It is important to note that the expense amounts shown in the table are meant to highlight only ongoing costs of investing in the fund and do not reflect any transactional costs, such as sales charges, redemption or exchange fees. Therefore, the hypothetical examples provided may not help you determine the relative total costs of owning shares of different funds. If these transactional costs were included, your costs would have been higher. COMPARE WITH OTHER FUNDS Since all mutual fund companies are required to include the same hypothetical calculations about expenses in shareholder reports, you can use this information to compare the ongoing cost of investing in the fund with other funds. To do so, compare the 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds. As you compare hypothetical examples of other funds, it is important to note that hypothetical examples are meant to highlight the continuing cost of investing in a fund and do not reflect any transactional costs, such as sales charges or redemption or exchange fees. 39 [sidebar] SUMMARY o FOR THE SIX-MONTH PERIOD ENDED FEBRUARY 28, 2005, THE FUND'S CLASS A SHARES RETURNED 0.54% WITHOUT SALES CHARGE. o THE FUND'S RETURN WAS HIGHER THAN THE MERRILL LYNCH 1-3 YEAR TREASURY INDEX, THE MERRILL LYNCH 1-5 YEAR GOVERNMENT/CORPORATE BOND INDEX AND THE LIPPER SHORT INVESTMENT GRADE DEBT CATEGORY AVERAGE. o THE FUND'S RELATIVE STRONG PERFORMANCE WHEN COMPARED TO THE BENCHMARKS RESULTED FROM AN EMPHASIS ON FLOATING RATE SECURITIES AND A BARBELL STRATEGY THAT MINIMIZED EXPOSURE TO INTERMEDIATE-TERM BONDS, WHICH WERE HURT BY RISING SHORT-TERM INTEREST RATES. [UP ARROW] [DOWN ARROW] MERRILL LYNCH 1-3 CLASS A SHARES YEAR TREASURY INDEX 0.54% -0.33% OBJECTIVE Seeks a high level of current income consistent with a high degree of principal stability by investing primarily in short- term, investment-grade, fixed income securities. TOTAL NET ASSETS $493.2 million NET ASSET VALUE PER SHARE AS OF 02/28/05 ($) Class A 8.58 ----------------------------------------------- Class B 8.58 ----------------------------------------------- Class C 8.58 ----------------------------------------------- Class D 8.58 ----------------------------------------------- Class G 8.58 ----------------------------------------------- Class T 8.58 ----------------------------------------------- Class Z 8.58 Distributions declared per share 09/01/04 - 02/28/05 ($) Class A 0.11 ----------------------------------------------- Class B 0.07 ----------------------------------------------- Class C 0.10 ----------------------------------------------- Class D 0.10 ----------------------------------------------- Class G 0.08 ----------------------------------------------- Class T 0.11 ----------------------------------------------- Class Z 0.12 PORTFOLIO MANAGERS' REPORT _____________________________________________________ Columbia Short Term Bond Fund For the six-month period ended February 28, 2005, Columbia Short Term Bond Fund class A shares returned 0.54% without sales charge. The fund's performance was higher than the benchmark Merrill Lynch 1-3 Year Treasury Index, which returned negative 0.33%, and the Merrill Lynch 1-5 Year Government/Corporate Bond Index, which returned negative 0.29%, during the period. The fund also outperformed its peer group, the Lipper Short Investment Grade Debt Category, whose average return was 0.33%. 1 The fund's positions in floating-rate securities aided performance during a period of rising short-term interest rates. RISE IN SHORT-TERM INTEREST RATES BOOSTED YIELD The most important development during the period was the sustained effort by the Federal Reserve Board (the Fed) to push short-term interest rates higher. On June 30, 2004, the Fed raised the federal funds rate--the overnight lending rate for banks--from 1.0% to 1.25%. It intervened on five subsequent occasions to raise the federal funds rate in one-quarter percentage point increments to 2.50%. 2 During this reporting period, rates on three-month Treasury securities increased 117 basis points to 2.75%, while two-year yields rose by 120 basis points to 3.60%. (A basis point in one one-hundredth of one percent.) These increases helped boost the fund's yield above the very low yield levels that have prevailed for more than a year. Furthermore, because 25% of the portfolio was invested in floating-rate securities, whose coupons are reset as interest rates change, fund performance received an added boost. Our overall response to the Fed's interest rate increases was to employ a barbell strategy that minimized our exposure to intermediate (two- to three-year maturity) bonds. This maturity range was the worst-performing segment of the fixed-income market. Generally speaking, we made few changes to the fund's sector allocations during the period. Approximately 49% of the fund's assets were devoted to mortgage and asset-backed securities, 38% to corporate obligations with the remainder in Treasuries and a small amount was held in cash or cash equivalents. 1 Lipper Inc., a widely respected data provider in the industry, calculates an average total return for mutual funds with similar investment objectives as those of the fund. 2 On March 22, 2005, the federal funds rate was increased to 2.75%. 40 [sidebar] PORTFOLIO QUALITY AS OF 02/28/05 (%) Aaa 30.3 ----------------------------------------------- Aa 10.3 ----------------------------------------------- A 18.3 ----------------------------------------------- Baa 11.4 ----------------------------------------------- Agency 22.7 ----------------------------------------------- Treasury 7.0 Portfolio quality is calculated as a percentage of total investments. Ratings shown in the quality breakdown represent the highest rating assigned to a particular bond by one of the following nationally recognized rating agencies: Standard & Poor's, a division of The McGraw-Hill Companies, Inc., Moody's Investors Service, Inc. or Fitch Ratings Ltd. PORTFOLIO COMPOSITION AS OF 02/28/05 (%) Corporate fixed-income bonds & notes 35.7 ----------------------------------------------- Mortgage-backed obligations 20.9 ----------------------------------------------- Collateralized mortgage obligations 17.4 ----------------------------------------------- Asset-backed securities 11.3 ----------------------------------------------- Government agencies & obligations 10.5 ----------------------------------------------- Cash & cash equivalents, net receivables & payables 4.2 MATURITY BREAKDOWN AS OF 02/28/05 (%) 0-1 years 41.1 ----------------------------------------------- 1-3 years 36.8 ----------------------------------------------- 3-5 years 20.9 ----------------------------------------------- 5-10 years 1.2 Your fund is actively managed and the composition of its portfolio will change over time. Portfolio composition and maturity breakdown are calculated as a percentage of net assets. ________________________________________________________________________________ Columbia Short Term Bond Fund FUND POSITIONED FOR RISING INFLATION RATE Now that the economy has produced several quarters of solid, though unexceptional, growth, we expect the Fed to continue to push short-term rates higher for at least the first half of 2005. Overall, the economy is expected to grow at a pace of roughly 3.5% for the year, with inflation, as measured by the Consumer Price Index, at about 2.5%. Although we do not view this amount of inflation as particularly worrisome, we have recently added slightly to the portfolio's holdings of TIPS (Treasury Inflation-Protected Securities). We were able to purchase these securities at attractive prices during January, essentially providing a hedge against higher-than-expected inflation. Leonard A. Aplet, CFA, has co-managed Columbia Short Term Bond Fund since November 2000 and has been with the advisor or its predecessors or affiliate organizations since 1987. /s/ Leonard A. Aplet Richard R. Cutts, CFA, has co-managed the fund since December 2002 and has been with the advisor or its predecessors or affiliate organizations since 1994. /s/ Richard R. Cutts The Board of Trustees has approved a proposal to reorganize the Columbia Short Term Bond Fund into the Nations Short-Term Income Fund, subject to shareholder approval and the satisfaction of certain other conditions. The effective date of the reorganization is expected to be in September or October of 2005. Investing in fixed-income securities may involves certain risks, including the credit quality of individual issuers, possible prepayments, market or economic developments and yields and share price fluctuations due to changes in interest rates. When interest rates go up, bond prices typically drop, and vice versa. 41 [sidebar] PERFORMANCE OF A $10,000 INVESTMENT 03/01/95 - 02/28/05 ($) SALES CHARGE WITHOUT WITH ----------------------------------------------- Class A 19,021 18,124 ----------------------------------------------- Class B 18,689 18,689 ----------------------------------------------- Class C 18,727 18,727 ----------------------------------------------- Class D 18,772 18,579 ----------------------------------------------- Class Z 19,184 n/a Performance data quoted represents past performance and current performance may be lower or higher. Past performance is no guarantee of future results. The investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than the original cost. Please visit www.columbiafunds.com for daily and most recent month-end performance updates. PERFORMANCE INFORMATION ________________________________________________________ Columbia Fixed Income Securities Fund VALUE OF A $10,000 INVESTMENT 03/01/95 - 02/28/05 [MOUNTAIN CHART] LEHMAN CLASS A CLASS A BROTHERS SHARES WITHOUT SHARES WITH AGGREGATE SALES CHARGE SALES CHARGE BOND INDEX -------------- ------------ ---------- 03/95 10000 9525 10000 10068 9590 10061 10216 9731 10202 10624 10119 10597 10709 10200 10674 10681 10173 10651 10815 10302 10779 10933 10414 10884 11076 10550 11025 11246 10712 11191 11408 10866 11348 11477 10932 11422 11265 10730 11224 11191 10659 11145 11105 10577 11083 11080 10554 11061 11236 10703 11209 11254 10720 11239 11245 10711 11220 11448 10904 11415 11690 11135 11669 11907 11341 11868 11794 11233 11758 11841 11278 11794 11878 11313 11824 11752 11193 11692 11924 11358 11868 12035 11464 11981 12174 11595 12123 12508 11914 12450 12397 11808 12345 12576 11978 12526 12767 12160 12708 12805 12197 12766 12922 12308 12895 13077 12456 13060 13066 12446 13050 13096 12474 13094 13164 12539 13162 13295 12663 13287 13402 12766 13400 13422 12785 13428 13641 12993 13647 13900 13240 13966 13778 13124 13892 13836 13179 13972 13884 13225 14014 13983 13319 14113 13715 13063 13866 13802 13147 13942 13848 13190 13987 13683 13033 13864 13623 12976 13819 13532 12889 13760 13505 12863 13753 13671 13021 13913 13709 13058 13964 13725 13073 13963 13672 13022 13896 13591 12946 13850 13730 13078 14018 13904 13244 14203 13856 13197 14161 13844 13187 14154 14145 13473 14449 14245 13569 14580 14462 13775 14792 14563 13871 14885 14643 13948 14983 14910 14201 15229 15212 14490 15512 15482 14746 15766 15616 14874 15904 15701 14955 15983 15602 14861 15916 15706 14960 16011 15752 15004 16072 16112 15347 16432 16267 15494 16621 16438 15657 16816 16770 15973 17167 16560 15774 16930 16449 15668 16822 16550 15764 16958 16684 15891 17123 16449 15667 16838 16753 15957 17165 16880 16078 17311 16943 16138 17460 17105 16293 17671 17398 16571 17970 17652 16813 18261 17447 16618 18177 17428 16600 18171 17693 16852 18548 17714 16873 18564 17960 17107 18820 17948 17095 18805 18082 17223 18962 18372 17499 19314 18313 17443 19276 17729 16886 18628 17840 16993 18751 18293 17424 19248 18132 17271 19069 18123 17263 19115 18290 17421 19309 18431 17555 19464 18602 17719 19674 18733 17843 19822 18300 17431 19306 18181 17317 19229 18257 17390 19339 18431 17555 19530 18755 17864 19903 18817 17923 19957 18973 18072 20125 18825 17931 19964 18996 18094 20147 19086 18179 20274 02/05 19021 18124 20158 The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The Lehman Brothers Aggregate Bond Index is a market value-weighted index that tracks the daily price, coupon, pay-downs, and total return performance of fixed-rate, publicly placed, dollar-denominated, and non-convertible investment grade debt issues with at least $250 million par amount outstanding and with at least one year to final maturity. Unlike the fund, indices are not investments, do not incur fees or expenses and are not professionally managed. It is not possible to invest directly in an index. Securities in the fund may not match those in an index. AVERAGE ANNUAL TOTAL RETURN AS OF 02/28/05 (%)
SHARE CLASS A B C D Z -------------------------------------------------------------------------------------------------------------- INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 02/25/83 -------------------------------------------------------------------------------------------------------------- SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT -------------------------------------------------------------------------------------------------------------- 6-month (cumulative) 1.41 -3.39 1.04 -3.89 1.11 0.13 1.11 0.13 1.51 -------------------------------------------------------------------------------------------------------------- 1-year 2.24 -2.61 1.48 -3.39 1.65 0.68 1.64 0.66 2.45 -------------------------------------------------------------------------------------------------------------- 5-year 6.74 5.70 6.36 6.05 6.40 6.40 6.46 6.25 6.92 -------------------------------------------------------------------------------------------------------------- 10-year 6.64 6.13 6.45 6.45 6.47 6.47 6.50 6.39 6.73
AVERAGE ANNUAL TOTAL RETURN AS OF 12/31/04 (%)
SHARE CLASS A B C D Z -------------------------------------------------------------------------------------------------------------- SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT -------------------------------------------------------------------------------------------------------------- 6-month (cumulative) 4.05 -0.90 3.65 -1.35 3.74 2.74 3.73 2.73 4.15 -------------------------------------------------------------------------------------------------------------- 1-year 3.87 -1.04 3.09 -1.85 3.23 2.24 3.25 2.26 4.08 -------------------------------------------------------------------------------------------------------------- 5-year 6.80 5.77 6.45 6.14 6.49 6.49 6.54 6.32 6.98 -------------------------------------------------------------------------------------------------------------- 10-year 7.07 6.55 6.90 6.90 6.91 6.91 6.94 6.84 7.16
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF 4.75% FOR CLASS A SHARES, MAXIMUM CONTINGENT DEFERRED SALES CHARGE OF 5.00% FOR CLASS B SHARES AND 1.00% FOR CLASS C AND D SHARES FOR THE FIRST YEAR ONLY. THE "WITHOUT SALES CHARGE" RETURNS DO NOT INCLUDE THE EFFECT OF SALES CHARGES. IF THEY HAD, RETURNS WOULD BE LOWER. ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS. CLASS Z SHARES ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT SHARE CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES ASSOCIATED WITH EACH CLASS. Effective October 13, 2003, class D shares were closed to all new investors and new accounts. Existing class D shareholders will be able to make additional purchases at any time. In addition, the class D initial sales charge of 1.00% is waived after October 13, 2003. Performance results reflect any voluntary waivers or reimbursement of fund expenses by the advisor or its affiliates. Absent these waivers or reimbursement arrangements, performance results would have been lower. Classes A, B and D (newer class shares) share performance information includes returns of the fund's class Z shares (the oldest existing fund class) for periods prior to the inception of the newer class shares. The returns for Class C include the returns of Class B prior to 10/13/03, the date on which class C was initially offered by the fund. The returns shown for Class C also include the performance of Class Z prior to the inception of Class B (11/01/02). Class Z share returns are not restated to reflect any expense differential (e.g., Rule 12b-1 fees) between class Z shares and the newer class shares. Had the expense differential been reflected, the returns for the periods prior to the inception of classes A, B, C and D would have been lower. 42 [sidebar] ESTIMATING YOUR ACTUAL EXPENSES To estimate the expenses that you paid over the period, first you will need your account balance at the end of the period: o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611 o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE 1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6 2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD," LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1. YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING THE PERIOD UNDERSTANDING YOUR EXPENSES_____________________________________________________ Columbia Fixed Income Securities Fund As a fund shareholder, you incur two types of costs. There are transaction costs, which generally include sales charges on purchases and may include redemption or exchange fees. There are also ongoing costs, which generally include investment advisory fees, Rule 12b-1 fees, and other fund expenses. The information on this page is intended to help you understand your ongoing costs of investing in the fund and to compare these costs with the ongoing costs of investing in other mutual funds. ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS To illustrate these ongoing costs, we have provided an example and calculated the expenses paid by investors in each share class during the reporting period. The information in the following table is based on an initial investment of $1,000, which is invested at the beginning of the reporting period and held for the entire period. Expense information is calculated two ways and each method provides you with different information. The amount listed in the "actual" column is calculated using the fund's actual operating expenses and total return for the period. The amount listed in the "hypothetical" column for each share class assumes that the return each year is 5% before expenses and includes the fund's actual expense ratio. You should not use the hypothetical account values and expenses to estimate either your actual account balance at the end of the period or the expenses you paid during this reporting period. 09/01/04 - 02/28/05
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%) ----------------------------------------------------------------------------------------------------------------------- ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ----------------------------------------------------------------------------------------------------------------------- Class A 1,000.00 1,000.00 1,014.08 1,019.34 5.49 5.51 1.10 ----------------------------------------------------------------------------------------------------------------------- Class B 1,000.00 1,000.00 1,010.41 1,015.62 9.22 9.25 1.85 ----------------------------------------------------------------------------------------------------------------------- Class C 1,000.00 1,000.00 1,011.11 1,016.36 8.48 8.50 1.70 ----------------------------------------------------------------------------------------------------------------------- Class D 1,000.00 1,000.00 1,011.11 1,016.36 8.48 8.50 1.70 ----------------------------------------------------------------------------------------------------------------------- Class Z 1,000.00 1,000.00 1,015.12 1,020.58 4.25 4.26 0.85
Expenses paid during the period are equal to the fund's annualized expense ratio, multiplied by the average account value over the period, then multiplied by the number of days in the fund's most recent fiscal half-year and divided by 365. Had the Distributor not waived a portion of expenses, total return would have been reduced. It is important to note that the expense amounts shown in the table are meant to highlight only ongoing costs of investing in the fund and do not reflect any transactional costs, such as sales charges, redemption or exchange fees. Therefore, the hypothetical examples provided may not help you determine the relative total costs of owning shares of different funds. If these transactional costs were included, your costs would have been higher. COMPARE WITH OTHER FUNDS Since all mutual fund companies are required to include the same hypothetical calculations about expenses in shareholder reports, you can use this information to compare the ongoing cost of investing in the fund with other funds. To do so, compare the 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds. As you compare hypothetical examples of other funds, it is important to note that hypothetical examples are meant to highlight the continuing cost of investing in a fund and do not reflect any transactional costs, such as sales charges or redemption or exchange fees. 43 [sidebar] SUMMARY o FOR THE SIX-MONTH PERIOD ENDED FEBRUARY 28, 2005, THE FUND'S CLASS A SHARES RETURNED 1.41% WITHOUT SALES CHARGE. o THE FUND OUTPERFORMED THE LEHMAN BROTHERS AGGREGATE BOND INDEX BUT TRAILED THE AVERAGE RETURN OF ITS PEER GROUP, THE LIPPER CORPORATE DEBT FUNDS A RATED CATEGORY. o AN EMPHASIS ON CORPORATE BONDS AND MORTGAGE-BACKED SECURITIES HELPED PERFORMANCE AS THESE BONDS DID WELL DURING THE PERIOD. [UP ARROW] [UP ARROW] LEHMAN BROTHERS AGGREGATE CLASS A SHARES BOND INDEX 1.41% 1.26% OBJECTIVE Seeks a high level of income by investing in a broad range of debt securities with intermediate to long-term maturities. TOTAL NET ASSETS $283.1 million NET ASSET VALUE PER SHARE AS OF 02/28/05 ($) Class A 13.28 ----------------------------------------------- Class B 13.28 ----------------------------------------------- Class C 13.28 ----------------------------------------------- Class D 13.28 ----------------------------------------------- Class Z 13.28 DISTRIBUTIONS DECLARED PER SHARE 09/01/04 - 02/28/05 ($) Class A 0.40 ----------------------------------------------- Class B 0.35 ----------------------------------------------- Class C 0.36 ----------------------------------------------- Class D 0.36 ----------------------------------------------- Class Z 0.41 Distributions include $0.14 per share of realized gains. PORTFOLIO MANAGERS' REPORT______________________________________________________ Columbia Fixed Income Securities Fund For the six-month period ended February 28, 2005, Columbia Fixed Income Securities Fund class A shares returned 1.41% without sales charge. By comparison, the Lehman Brothers Aggregate Bond Index and the Lipper Corporate Debt Funds A Rated Category average returned 1.26% and 1.54%, respectively, over the same period. 1 The fund benefited from its emphasis on mortgage-backed securities, which performed well during the period. We believe that the fund's exposure to longer-term bonds, which led a rally late in the period, may have been lower than its peer group and accounted for its slight underperformance. However, we believe that our positioning is appropriate, given the likelihood of rising interest rates in the period ahead. SHORT-TERM INTEREST RATES ROSE, WHILE LONG-TERM RATES DECLINED During the six-month reporting period, short-term rates rose while long-term rates fell, resulting in what is known as a flattening yield curve. The yield curve connects the points on a graph depicting the yields for various Treasury maturities, from short- to long-term. The rise in short-term rates came as no surprise. On June 30, 2004, the Federal Reserve Board (the Fed) raised a key short-term interest rate--the federal funds rate--for the first time in four years. The Fed indicated that it would continue to raise short-term rates at a measured pace in an effort to control inflation and maintain economic growth. True to its word, the Fed raised the federal funds rate by one-quarter of one percentage point at each of its four meetings during this reporting period, from 1.50% to 2.50%. 2 The yield on three-month Treasury securities rose by 117 basis points to yield 2.75%, while two-year Treasury yields rose by 120 basis points to 3.60%. (A basis point is one hundredth of one percent.) The decline in long-term rates was somewhat surprising to investors because it occurred despite weakness in the dollar and high energy prices, both of which have historically tended to lead to higher inflation. Ultimately the Consumer Price Index (CPI), a common measure of inflation, rose 3.3% in 2004. However, the core rate of inflation rose only 2.2%, an indication that an increase in energy prices did not spread to the entire economy. Also, foreign central banks have been substantial buyers of dollar-denominated assets, including Treasury obligations with longer maturities. Their purchases helped to bring long-term yields down. SECTOR ALLOCATION AIDED PERFORMANCE The fund's emphasis on corporate bonds and mortgage-backed securities helped the fund's performance relative to its benchmark. Altogether, 33% of the fund's assets are invested in investment-grade corporate bonds. This figure is down approximately two percentage points from the level of six months ago. Mortgage-backed and asset-backed securities account for about 50% of the portfolio. We have emphasized CMOs 1 Lipper Inc., a widely respected data provider in the industry, calculates an average total return for mutual funds with similar investment objectives as those of the fund. 2 On March 22, 2005, the federal funds rate was raised to 2.75%. 44 [sidebar] PORTFOLIO QUALITY AS OF 02/28/05 (%) TREASURY/AGENCY 48.7 ----------------------------------------------- Aaa 13.1 ----------------------------------------------- Aa 6.7 ----------------------------------------------- A 13.5 ----------------------------------------------- Baa 12.1 ----------------------------------------------- Ba 3.5 ----------------------------------------------- B 2.3 ----------------------------------------------- Caa 0.1 Portfolio quality is calculated as a percentage of total investments. Ratings shown in the quality breakdown represent the rating assigned to a particular bond by one of the following nationally recognized rating agencies: Standard & Poor's, a division of The McGraw-Hill Companies, Inc., Moody's Investors Service, Inc. or Fitch Ratings Ltd. PORTFOLIO COMPOSITION AS OF 02/28/05 (%) Mortgage-backed obligations 38.8 ----------------------------------------------- Corporate fixed-income bonds & notes 36.5 ----------------------------------------------- Government agencies &obligations 11.9 ----------------------------------------------- Collateralized mortgage obligations 7.0 ----------------------------------------------- Asset-backed securities 3.3 ----------------------------------------------- Cash & cash equivalents, net receivables & payables 2.5 MATURITY BREAKDOWN AS OF 02/28/05 (%) 0-1 years 12.0 ----------------------------------------------- 1-5 years 58.0 ----------------------------------------------- 5-10 years 20.7 ----------------------------------------------- 10-20 years 0.0 ----------------------------------------------- 20+ years 9.3 Your fund is actively managed and the composition of its portfolio will change over time. Portfolio composition and maturity breakdown are calculated as a percentage of net assets. ________________________________________________________________________________ Columbia Fixed Income Securities Fund (collateralized mortgage obligations) because they provide slightly better protection against interest-rate shifts than offered by conventional pass-through securities. Gains from these sectors helped offset a modest shortfall that resulted from the fund's duration, which was slightly lower than the benchmark. Duration is a measure of the fund's sensitivity to interest rates. Generally, we keep the duration of the fund within one year of the duration of the Lehman Brothers Aggregate Bond Index. We tend to lower duration when we expect interest rates to rise. If we are right, our move helps cushion the fund because interest rates and prices move in opposite directions. However, longer-term interest rates declined during this reporting period, which hindered this strategy. RELATIVELY SHORT DURATION MAINTAINED We have maintained the fund's relatively short duration because we believe that interest rates are likely to rise in 2005. In addition, we have added slightly to the fund's holdings of TIPS (Treasury Inflation-Protected Securities). Although we are not overly concerned about inflation, we viewed these securities as attractively priced. Leonard A. Aplet has co-managed Columbia Fixed Income Securities Fund since January1988 and has been with the advisor or its predecessors or affiliate organizations since 1987. /s/ Leonard A. Aplet Richard R. Cutts has co-managed the fund since December 2002 and has been with the advisor or its predecessors or affiliate organizations since 1994. /s/ Richard R. Cutts Investing in fixed-income securities may involves certain risks, including the credit quality of individual issuers, possible prepayments, market or economic developments and yields and share price fluctuations due to changes in interest rates. When interest rates go up, bond prices typically drop, and vice versa. 45 [sidebar] PERFORMANCE OF A $10,000 INVESTMENT 02/24/99 - 02/28/05 ($) SALES CHARGE WITHOUT WITH ----------------------------------------------- Class A 13,191 12,563 ----------------------------------------------- Class B 12,967 12,967 ----------------------------------------------- Class C 13,030 13,030 ----------------------------------------------- Class D 13,066 12,937 ----------------------------------------------- Class Z 13,276 n/a Performance data quoted represents past performance and current performance may be lower or higher. Past performance is no guarantee of future results. The investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than the original cost. Please visit www.columbiafunds.com for daily and most recent month-end performance updates. PERFORMANCE INFORMATION_________________________________________________________ Columbia National Municipal Bond Fund VALUE OF A $10,000 INVESTMENT 02/24/99 - 02/28/05 [MOUNTAIN CHART] LEHMAN CLASS A SHARES CLASS A SHARES BROTHERS WITHOUT SALES WITH SALES MUNICIPAL BOND CHARGE CHARGE INDEX -------------- -------------- -------------- 02/99 10000 9525 10000 9934 9462 10000 9920 9449 10014 9951 9478 10039 9893 9423 9981 9733 9271 9837 9768 9304 9872 9671 9212 9794 9675 9216 9797 9567 9112 9692 9674 9214 9794 9608 9152 9721 9543 9089 9678 9641 9183 9790 9868 9399 10004 9791 9326 9945 9714 9253 9893 9985 9511 10155 10110 9630 10296 10267 9779 10455 10209 9724 10401 10336 9845 10514 10407 9913 10594 10654 10148 10856 10749 10238 10963 10765 10253 10998 10861 10345 11097 10737 10227 10977 10844 10329 11096 10918 10399 11170 11082 10555 11335 11256 10721 11522 11216 10684 11483 11346 10807 11620 11217 10684 11522 11097 10570 11413 11297 10760 11610 11426 10883 11750 11205 10673 11519 11454 10910 11744 11517 10970 11816 11649 11096 11941 11818 11257 12095 11952 11384 12240 12236 11655 12508 12017 11446 12300 11950 11382 12249 12209 11629 12507 12137 11561 12476 12328 11742 12651 12339 11753 12658 12431 11841 12742 12733 12129 13040 12665 12063 12985 12210 11630 12531 12302 11717 12625 12694 12091 12996 12585 11987 12931 12694 12091 13065 12803 12195 13174 12851 12240 13249 13074 12453 13448 12985 12369 13401 12647 12046 13083 12644 12043 13036 12693 12090 13083 12843 12233 13255 13068 12447 13521 13115 12492 13592 13174 12548 13709 13042 12423 13597 13193 12567 13763 13266 12636 13891 02/05 13191 12563 13848 The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The Lehman Brothers Municipal Bond Index is an unmanaged index considered representative of the broad market for investment-grade, tax exempt bonds with a maturity of at least one year. Unlike the fund, indices are not investments, do not incur fees or expenses and are not professionally managed. It is not possible to invest directly in an index. Securities in the fund may not match those in an index. Index performance is from February 28, 1999. AVERAGE ANNUAL TOTAL RETURN AS OF 02/28/05 (%)
SHARE CLASS A B C D Z ------------------------------------------------------------------------------------------------------------- INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 02/24/99 ------------------------------------------------------------------------------------------------------------- SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT ------------------------------------------------------------------------------------------------------------- 6-MONTH (CUMULATIVE) 1.00 -3.80 0.63 -4.30 0.80 -0.18 0.80 -0.18 1.12 ------------------------------------------------------------------------------------------------------------- 1-year 0.94 -3.85 0.20 -4.64 0.59 -0.38 0.54 -0.43 1.17 ------------------------------------------------------------------------------------------------------------- 5-year 6.47 5.44 6.11 5.79 6.21 6.21 6.27 6.06 6.61 ------------------------------------------------------------------------------------------------------------- Life 4.72 3.87 4.42 4.42 4.50 4.50 4.55 4.38 4.83
AVERAGE ANNUAL TOTAL RETURN AS OF 12/31/04 (%)
SHARE CLASS A B C D Z ------------------------------------------------------------------------------------------------------------- SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT ------------------------------------------------------------------------------------------------------------- 6-MONTH (CUMULATIVE) 3.94 -1.00 3.55 -1.45 3.77 2.77 3.73 2.73 4.06 ------------------------------------------------------------------------------------------------------------- 1-year 3.03 -1.86 2.27 -2.67 2.63 1.64 2.62 1.63 3.27 ------------------------------------------------------------------------------------------------------------- 5-year 6.54 5.51 6.20 5.88 6.29 6.29 6.35 6.14 6.67 ------------------------------------------------------------------------------------------------------------- Life 4.84 3.97 4.56 4.42 4.63 4.63 4.68 4.50 4.95
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF 4.75% FOR CLASS A SHARES, MAXIMUM CONTINGENT DEFERRED SALES CHARGE OF 5.00% FOR CLASS B SHARES AND 1.00% FOR CLASS C AND D SHARES FOR THE FIRST YEAR ONLY. THE "WITHOUT SALES CHARGE" RETURNS DO NOT INCLUDE THE EFFECT OF SALES CHARGES. IF THEY HAD, RETURNS WOULD BE LOWER. ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS. CLASS Z SHARES ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT SHARE CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES ASSOCIATED WITH EACH CLASS. Effective October 13, 2003, class D shares were closed to all new investors and new accounts. Existing class D shareholders will be able to make additional purchases at any time. In addition, class D initial sales charge of 1.00% is waived after October 13, 2003. Performance results reflect any voluntary waivers or reimbursement of fund expenses by the advisor or its affiliates. Absent these waivers or reimbursement arrangements, performance results would have been lower. Classes A, B and D (newer class shares) share performance information includes returns of the fund's class Z shares (the oldest existing fund class) for periods prior to the inception of the newer class shares. The returns for class C include the returns of class B prior to 10/13/03, the date on which class C was initially offered by the fund. The returns shown for class C also include the performance of class Z prior to the inception of class B (11/01/02). Class Z share returns are not restated to reflect any expense differential (e.g., Rule 12b-1 fees) between class Z shares and the newer class shares. Had the expense differential been reflected, the returns for the periods prior to the inception of classes A, B, C and D would have been lower. 46 [sidebar] ESTIMATING YOUR ACTUAL EXPENSES To estimate the expenses that you paid over the period, first you will need your account balance at the end of the period: o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611 o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE 1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6 2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD," LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1. YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING THE PERIOD UNDERSTANDING YOUR EXPENSES_____________________________________________________ Columbia National Municipal Bond Fund As a fund shareholder, you incur two types of costs. There are transaction costs, which generally include sales charges on purchases and may include redemption or exchange fees. There are also ongoing costs, which generally include investment advisory fees, Rule 12b-1 fees, and other fund expenses. The information on this page is intended to help you understand your ongoing costs of investing in the fund and to compare these costs with the ongoing costs of investing in other mutual funds. ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS To illustrate these ongoing costs, we have provided an example and calculated the expenses paid by investors in each share class during the reporting period. The information in the following table is based on an initial investment of $1,000, which is invested at the beginning of the reporting period and held for the entire period. Expense information is calculated two ways and each method provides you with different information. The amount listed in the "actual" column is calculated using the fund's actual operating expenses and total return for the period. The amount listed in the "hypothetical" column for each share class assumes that the return each year is 5% before expenses and includes the fund's actual expense ratio. You should not use the hypothetical account values and expenses to estimate either your actual account balance at the end of the period or the expenses you paid during this reporting period. 09/01/04 - 02/28/05
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%) ---------------------------------------------------------------------------------------------------------------------- ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ---------------------------------------------------------------------------------------------------------------------- Class A 1,000.00 1,000.00 1,010.02 1,020.33 4.49 4.51 0.90 ---------------------------------------------------------------------------------------------------------------------- Class B 1,000.00 1,000.00 1,006.30 1,016.61 8.21 8.25 1.65 ---------------------------------------------------------------------------------------------------------------------- Class C 1,000.00 1,000.00 1,007.98 1,018.35 6.47 6.51 1.30 ---------------------------------------------------------------------------------------------------------------------- Class D 1,000.00 1,000.00 1,007.98 1,018.35 6.47 6.51 1.30 ---------------------------------------------------------------------------------------------------------------------- Class Z 1,000.00 1,000.00 1,011.21 1,021.57 3.24 3.26 0.65
Expenses paid during the period are equal to the fund's annualized expense ratio, multiplied by the average account value over the period, then multiplied by the number of days in the fund's most recent fiscal half-year and divided by 365. Had the Investment Advisor and/or Distributor not reimbursed or waived a portion of expenses, total return would have been reduced. It is important to note that the expense amounts shown in the table are meant to highlight only ongoing costs of investing in the fund and do not reflect any transactional costs, such as sales charges, redemption or exchange fees. Therefore, the hypothetical examples provided may not help you determine the relative total costs of owning shares of different funds. If these transactional costs were included, your costs would have been higher. COMPARE WITH OTHER FUNDS Since all mutual fund companies are required to include the same hypothetical calculations about expenses in shareholder reports, you can use this information to compare the ongoing cost of investing in the fund with other funds. To do so, compare the 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds. As you compare hypothetical examples of other funds, it is important to note that hypothetical examples are meant to highlight the continuing cost of investing in a fund and do not reflect any transactional costs, such as sales charges or redemption or exchange fees. 47 [sidebar] SUMMARY o FOR THE SIX-MONTH PERIOD ENDED FEBRUARY 28, 2005, THE FUND'S CLASS A SHARES RETURNED 1.00% WITHOUT SALES CHARGE. o THE FUND'S RETURN WAS LESS THAN THE RETURN FOR ITS BENCHMARK, THE LEHMAN BROTHERS MUNICIPAL BOND INDEX, BUT ABOVE THE AVERAGE FOR ITS PEER GROUP, THE LIPPER INTERMEDIATE MUNICIPAL DEBT FUNDS CATEGORY. o THE FUND'S EMPHASIS ON HIGH QUALITY BONDS, CONTRIBUTIONS FROM NON-RATED BONDS AND RELATIVELY LIGHT EXPOSURE TO SHORT MATURITIES AIDED PERFORMANCE. [UP ARROW] [UP ARROW] LEHMAN BROTHERS MUNICIPAL BOND CLASS A SHARES INDEX 1.00% 2.40% OBJECTIVE Seeks a high level of income exempt from federal income tax by investing primarily in municipal securities issued by state and local governments, their agencies and authorities, as well as the District of Columbia and U.S. territories and possessions. TOTAL NET ASSETS $11.0 million NET ASSET VALUE PER SHARE AS OF 02/28/05 ($) Class A 10.15 ----------------------------------------------- Class B 10.15 ----------------------------------------------- Class C 10.15 ----------------------------------------------- Class D 10.15 ----------------------------------------------- Class Z 10.15 DISTRIBUTIONS DECLARED PER SHARE 09/01/04 - 02/28/05 ($) Class A 0.25 ----------------------------------------------- Class B 0.21 ----------------------------------------------- Class C 0.23 ----------------------------------------------- Class D 0.23 ----------------------------------------------- Class Z 0.26 DISTRIBUTIONS INCLUDE $0.09 PER SHARE OF TAXABLE REALIZED GAINS. PORTFOLIO MANAGER'S REPORT______________________________________________________ Columbia National Municipal Bond Fund For the six-month period ended February 28, 2005, Columbia National Municipal Bond Fund class A shares returned 1.00% without sales charge. This was less than the return of its benchmark, the Lehman Brothers Municipal Bond Index, which was 2.40% over the same period. However, the fund beat the average return of the Lipper Intermediate Municipal Debt Funds Category, which was 0.87%. 1 The fund's focus on intermediate-maturity bonds, at a time when bonds with longer maturities provided higher returns, contributed to its underperformance compared to the fund's benchmark. However, we believe that the fund's emphasis on high quality bonds, as well as contributions from non-rated bonds and relatively light exposure to short maturities helped the fund outperform its peer group. VOLATILITY MARKED MUNICIPAL BOND RETURNS Overall, municipal bond returns were relatively modest for the period. The Federal Reserve Board (the Fed) raised short-term interest rates four times during the period, pushing the federal funds rate from 1.50% to 2.50%. 2 However, intermediate- and longer-term interest rates did not follow suit, in part, because job growth was not as strong as expected. While the jobs data helped dampen investor concerns about inflation, a few inflationary signs, such as rising commodity prices, added volatility to the markets. CONTINUED EMPHASIS ON QUALITY, GEOGRAPHIC AND SECTOR DIVERSIFICATION We continued to emphasize high quality, intermediate-maturity bonds while seeking to increase the fund's geographical and sector diversification. We reduced the fund's average maturity from just over 9 years at the end of August to approximately 8.5 years by the end of February, because we felt intermediate-maturity bonds held less risk of price declines in an environment where interest rates appeared poised to rise. We also reduced the fund's duration from 5.5 years to 5.2 years. Duration measures the fund's sensitivity to changes in interest rates. Typically, we lower duration when we expect interest rates to rise and lengthen duration when we expect rates to fall. If we are right, our decision about duration can aid performance. During the reporting period, our duration decision had mixed results. It did not aid performance early in the period because intermediate and long-term interest rates actually declined. But it helped when interest rates began to rise in the final month of the period. Because we believe that interest rates are likely to move higher over the short term, we have maintained the fund's lower duration. 1 Lipper Inc., a widely respected data provider in the industry, calculates an average total return for mutual funds with similar investment objectives as those of the fund. 2 On March 22, 2005, the federal funds rate was increased to 2.75%. 48 PORTFOLIO QUALITY AS OF 02/28/05 (%) AAA 82.2 ----------------------------------------------- AA 10.3 ----------------------------------------------- A 4.2 ----------------------------------------------- BBB 1.1 ----------------------------------------------- Non rated 2.2 Ratings shown in the quality breakdown represent the rating assigned to a particular bond by one of the following nationally recognized rating agencies: Standard & Poor's, a division of The McGraw-Hill Companies, Inc., Moody's Investors Service, Inc. or Fitch Ratings Ltd. TOP 5 SECTORS AS OF 02/28/05 (%) Tax-backed 39.6 ----------------------------------------------- Other 16.0 ----------------------------------------------- Utilities 15.9 ----------------------------------------------- Health care 11.0 ----------------------------------------------- Resource Recovery 3.3 Your fund is actively managed and the sector breakdown of its portfolio will change over time. Sector breakdown is calculated as a percentage of net assets. MATURITY BREAKDOWN AS OF 02/28/05 (%) 1-3 years 1.4 ----------------------------------------------- 3-5 years 5.6 ----------------------------------------------- 5-7 years 21.7 ----------------------------------------------- 7-10 years 27.0 ----------------------------------------------- 10-15 years 42.9 ----------------------------------------------- 15-20 years 0.3 ----------------------------------------------- 20-25 years 1.1 Portfolio quality and maturity breakdown are calculated as a percentage of total investments. ABOUT DURATION Duration is a measure, expressed in years, of interest-rate sensitivity. It is similar to maturity, but because it takes into consideration the entire stream of future principal and interest payments and how long it will take to collect them, it is a more complex and more accurate measure of a fund's exposure to changing interest rates. Because we are active duration managers, we tend to use duration as a tactical tool to anticipate or respond to interest rate changes. Because bond prices and interest rates move in opposite directions, we lower duration when we expect interest rates to rise and we raise duration when we expect interest rates to fall. This adjustment provides the potential to benefit performance. If we are wrong and interest rates rise after we lengthen duration, or fall after we shorten duration, fund performance could be hurt. ________________________________________________________________________________ Columbia National Municipal Bond Fund The fund's non-rated bonds performed well during the period as investors appeared willing to accept higher risk in exchange for potentially higher returns. However, when the fund experienced substantial redemptions late in the period, we used it as an opportunity to reduce the fund's exposure to lower-quality bonds and to increase the fund's overall credit quality and its geographical and sector diversification. In particular, we continued to reduce the fund's exposure to Oregon and Washington State and increase holdings in Georgia, New York, Colorado and Kansas, where we saw the potential to add yield and value to the portfolio while improving liquidity. POTENTIAL FOR STABLE-TO-IMPROVING MUNICIPAL BOND ENVIRONMENT We expect the Fed to continue to raise short-term interest rates in 2005 as it tries to manage inflation in the face of continuing economic growth. That growth, however, should mean higher tax revenues for most state and local governments, which would likely result in improved balance sheets. While we do not expect to see many credit upgrades in coming months, we also don't expect many downgrades, which points to a relatively stable-to-improving environment for municipal issuers. In this environment, we plan to maintain our focus on high quality intermediate-maturity bonds. We also plan to continue to reduce the fund's small position in bonds subject to the alternative minimum tax. The fund will be closed to new investments after the close of business on April 29, 2005. The fund's trustees have approved its liquidation, which will take effect later this year, pending shareholder approval. Susan Sanderson has managed Columbia National Municipal Bond Fund since December 2003 and has been with the advisor and its predecessors or affiliate organizations since 1985. /s/ Susan Sanderson Tax-exempt investing offers current tax-exempt income, but it also involves special risks. The value of the fund will be affected by interest rate changes and the creditworthiness of issues held in the fund. When interest rates go up, bond prices generally drop and vice versa. Interest income from certain tax-exempt bonds may be subject to certain state and local taxes and, if applicable, the alternative minimum tax. Capital gains are not exempt from income taxes. 49 [sidebar] PERFORMANCE OF A $10,000 INVESTMENT 03/01/95 - 02/28/05 ($) SALES CHARGE WITHOUT WITH ----------------------------------------------- Class A 17,276 16,461 ----------------------------------------------- Class B 16,975 16,975 ----------------------------------------------- Class C 17,062 17,062 ----------------------------------------------- Class D 17,122 16,952 ----------------------------------------------- Class Z 17,411 n/a Performance data quoted represents past performance and current performance may be lower or higher. Past performance is no guarantee of future results. The investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than the original cost. Please visit www.columbiafunds.com for daily and most recent month-end performance updates. PERFORMANCE INFORMATION_________________________________________________________ Columbia Oregon Municipal Bond Fund VALUE OF A $10,000 INVESTMENT 03/01/95 - 02/28/05 [MOUNTAIN CHART] LEHMAN BROTHERS CLASS A SHARES GENERAL WITHOUT SALES CLASS A SHARES OBLIGATION BOND CHARGE WITH SALES CHARGE INDEX -------------- ----------------- --------------- 03/95 10000 9525 10000 10105 9625 10135 10116 9636 10142 10365 9873 10444 10282 9794 10373 10370 9878 10493 10502 10003 10626 10573 10070 10694 10696 10188 10816 10845 10330 10968 10908 10390 11055 10971 10450 11162 10916 10398 11111 10802 10289 10987 10757 10246 10949 10750 10239 10932 10857 10342 11042 10948 10428 11147 10950 10429 11146 11077 10550 11283 11187 10656 11415 11362 10822 11627 11316 10779 11581 11346 10807 11612 11437 10893 11718 11315 10778 11566 11390 10849 11657 11523 10976 11830 11627 11075 11958 11924 11357 12268 11847 11285 12159 11972 11403 12297 12030 11459 12365 12087 11513 12423 12262 11680 12599 12380 11792 12729 12365 11778 12739 12355 11768 12751 12313 11728 12683 12492 11898 12891 12519 11924 12938 12548 11952 12969 12737 12132 13174 12895 12283 13350 12873 12262 13353 12912 12299 13397 12946 12331 13441 13109 12486 13617 13008 12390 13548 13016 12397 13553 13053 12433 13591 12935 12320 13515 12751 12145 13318 12801 12193 13371 12690 12088 13292 12697 12094 13304 12566 11969 13188 12692 12089 13323 12602 12003 13239 12523 11929 13190 12629 12029 13322 12891 12279 13591 12822 12213 13521 12742 12137 13450 13051 12431 13795 13228 12600 13978 13429 12791 14177 13358 12723 14105 13504 12862 14253 13591 12946 14353 13896 13236 14692 14054 13387 14852 14094 13424 14896 14208 13533 15028 14054 13387 14871 14205 13530 15021 14294 13615 15115 14491 13803 15329 14725 14025 15576 14685 13987 15542 14871 14165 15700 14700 14002 15562 14527 13837 15438 14764 14062 15691 14936 14227 15882 14668 13971 15579 14955 14245 15900 15049 14335 15987 15227 14504 16166 15431 14698 16367 15613 14871 16553 15955 15197 16888 15663 14919 16614 15544 14806 16533 15850 15097 16857 15788 15038 16828 16033 15272 17060 16020 15259 17093 16132 15366 17204 16515 15730 17584 16424 15644 17500 15838 15085 16919 15941 15183 17076 16420 15640 17566 16300 15526 17448 16472 15689 17591 16607 15818 17716 16670 15878 17805 16975 16169 18085 16851 16051 18036 16431 15651 17630 16428 15648 17605 16492 15709 17674 16680 15888 17888 17005 16198 18231 17070 16259 18319 17190 16373 18463 17035 16226 18303 17232 16414 18502 17353 16529 18641 02/05 17276 16461 18563 The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The Lehman Brothers General Obligation Bond Index is an unmanaged index that represents average market-weighted performance of general obligation securities that have been issued in the last five years with maturities greater than one year. Unlike the fund, indices are not investments, do not incur fees or expenses and are not professionally managed. It is not possible to invest directly in an index. Securities in the fund may not match those in an index. AVERAGE ANNUAL TOTAL RETURN AS OF 02/28/05 (%)
SHARE CLASS A B C D Z --------------------------------------------------------------------------------------------------------------- INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 07/02/84 --------------------------------------------------------------------------------------------------------------- SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT --------------------------------------------------------------------------------------------------------------- 6-month (cumulative) 1.56 -3.26 1.17 -3.80 1.37 0.37 1.35 0.36 1.68 --------------------------------------------------------------------------------------------------------------- 1- year 1.74 -3.09 0.96 -3.93 1.36 0.38 1.33 0.35 1.99 --------------------------------------------------------------------------------------------------------------- 5-year 6.46 5.44 6.09 5.77 6.20 6.20 6.27 6.05 6.63 --------------------------------------------------------------------------------------------------------------- 10-year 5.62 5.11 5.43 5.43 5.49 5.49 5.53 5.42 5.70
AVERAGE ANNUAL TOTAL RETURN AS OF 12/31/04 (%)
SHARE CLASS A B C D Z --------------------------------------------------------------------------------------------------------------- SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT --------------------------------------------------------------------------------------------------------------- 6-month (cumulative) 4.50 -0.46 4.09 -0.91 4.31 3.31 4.28 3.28 4.63 --------------------------------------------------------------------------------------------------------------- 1- year 3.78 -1.15 2.99 -2.00 3.36 2.37 3.36 2.36 4.03 --------------------------------------------------------------------------------------------------------------- 5-year 6.47 5.43 6.12 5.80 6.21 6.21 6.29 6.07 6.62 --------------------------------------------------------------------------------------------------------------- 10-year 6.08 5.57 5.91 5.91 5.96 5.96 5.99 5.88 6.16
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF 4.75% FOR CLASS A SHARES, MAXIMUM CONTINGENT DEFERRED SALES CHARGE OF 5.00% FOR CLASS B SHARES AND 1.00% FOR CLASS C AND D SHARES FOR THE FIRST YEAR ONLY. THE "WITHOUT SALES CHARGE" RETURNS DO NOT INCLUDE THE EFFECT OF SALES CHARGES. IF THEY HAD, RETURNS WOULD BE LOWER. ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS. CLASS Z SHARES ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT SHARE CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES ASSOCIATED WITH EACH CLASS. Effective October 13, 2003, class D shares were closed to all new investors and new accounts. Existing class D shareholders will be able to make additional purchases at any time. In addition, class D initial sales charge of 1.00% is waived after October 13, 2003. Performance results reflect any voluntary waivers or reimbursement of fund expenses by the advisor or its affiliates. Absent these waivers or reimbursement arrangements, performance results would have been lower. Classes A, B and D (newer class shares) share performance information includes returns of the fund's class Z shares (the oldest existing fund class) for periods prior to the inception of the newer class shares. The returns for class C include the returns of class B prior to 10/13/03, the date on which class C was initially offered by the fund. The returns shown for class C also include the performance of class Z prior to the inception of class B (11/01/02). Class Z share returns are not restated to reflect any expense differential (e.g., Rule 12b-1 fees) between class Z shares and the newer class shares. Had the expense differential been reflected, the returns for the periods prior to the inception of classes A, B, C and D would have been lower. 50 ESTIMATING YOUR ACTUAL EXPENSES To estimate the expenses that you paid over the period, first you will need your account balance at the end of the period: o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611 o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE 1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6 2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD," LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1. YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING THE PERIOD UNDERSTANDING YOUR EXPENSES_____________________________________________________ Columbia Oregon Municipal Bond Fund As a fund shareholder, you incur two types of costs. There are transaction costs, which generally include sales charges on purchases and may include redemption or exchange fees. There are also ongoing costs, which generally include investment advisory fees, Rule 12b-1 fees, and other fund expenses. The information on this page is intended to help you understand your ongoing costs of investing in the fund and to compare these costs with the ongoing costs of investing in other mutual funds. ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS To illustrate these ongoing costs, we have provided an example and calculated the expenses paid by investors in each share class during the reporting period. The information in the following table is based on an initial investment of $1,000, which is invested at the beginning of the reporting period and held for the entire period. Expense information is calculated two ways and each method provides you with different information. The amount listed in the "actual" column is calculated using the fund's actual operating expenses and total return for the period. The amount listed in the "hypothetical" column for each share class assumes that the return each year is 5% before expenses and includes the fund's actual expense ratio. You should not use the hypothetical account values and expenses to estimate either your actual account balance at the end of the period or the expenses you paid during this reporting period. 09/01/04 - 02/28/05
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%) ------------------------------------------------------------------------------------------------------------------------ ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ------------------------------------------------------------------------------------------------------------------------ Class A 1,000.00 1,000.00 1,015.62 1,020.28 4.55 4.56 0.91 ------------------------------------------------------------------------------------------------------------------------ Class B 1,000.00 1,000.00 1,011.70 1,016.56 8.28 8.30 1.66 ------------------------------------------------------------------------------------------------------------------------ Class C 1,000.00 1,000.00 1,013.69 1,018.30 6.54 6.56 1.31 ------------------------------------------------------------------------------------------------------------------------ Class D 1,000.00 1,000.00 1,013.49 1,018.30 6.54 6.56 1.31 ------------------------------------------------------------------------------------------------------------------------ Class Z 1,000.00 1,000.00 1,016.81 1,021.52 3.30 3.31 0.66
Expenses paid during the period are equal to the fund's annualized expense ratio, multiplied by the average account value over the period, then multiplied by the number of days in the fund's most recent fiscal half-year and divided by 365. Had the Distributor not waived a portion of expenses for class C and class D, total return would have been reduced. It is important to note that the expense amounts shown in the table are meant to highlight only ongoing costs of investing in the fund and do not reflect any transactional costs, such as sales charges, redemption or exchange fees. Therefore, the hypothetical examples provided may not help you determine the relative total costs of owning shares of different funds. If these transactional costs were included, your costs would have been higher. COMPARE WITH OTHER FUNDS Since all mutual fund companies are required to include the same hypothetical calculations about expenses in shareholder reports, you can use this information to compare the ongoing cost of investing in the fund with other funds. To do so, compare the 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds. As you compare hypothetical examples of other funds, it is important to note that hypothetical examples are meant to highlight the continuing cost of investing in a fund and do not reflect any transactional costs, such as sales charges or redemption or exchange fees. 51 [sidebar] SUMMARY o FOR THE SIX-MONTH PERIOD ENDED FEBRUARY 28, 2005, THE FUND'S CLASS A SHARES RETURNED 1.56% WITHOUT SALES CHARGE. o THE FUND'S RETURN WAS LESS THAN THE RETURN FOR ITS BENCHMARK, THE LEHMAN BROTHERS GENERAL OBLIGATION BOND INDEX, AND THE AVERAGE FOR ITS PEER GROUP, THE LIPPER OREGON MUNICIPAL DEBT FUNDS CATEGORY. o THE FUND'S FOCUS ON MUNICIPAL BONDS WITH INTERMEDIATE MATURITIES, AT A TIME WHEN BONDS WITH LONGER MATURITIES PROVIDED HIGHER RETURNS, DETRACTED FROM PERFORMANCE. [UP ARROW] [UP ARROW] LEHMAN BROTHERS GENERAL OBLIGATION CLASS A SHARES BOND INDEX 1.56% 1.85% OBJECTIVE Seeks a high level of income exempt from federal and Oregon income tax by investing primarily in municipal securities issued by the state of Oregon. TOTAL NET ASSETS $425.7 million NET ASSET VALUE PER SHARE AS OF 02/28/05 ($) Class A 12.38 ----------------------------------------------- Class B 12.38 ----------------------------------------------- Class C 12.38 ----------------------------------------------- Class D 12.38 ----------------------------------------------- Class Z 12.38 DISTRIBUTIONS DECLARED PER SHARE 09/01/04 - 02/28/05 ($) Class A 0.26 ----------------------------------------------- Class B 0.21 ----------------------------------------------- Class C 0.24 ----------------------------------------------- Class D 0.24 ----------------------------------------------- Class Z 0.28 DISTRIBUTIONS INCLUDE $0.04 PER SHARE OF TAXABLE REALIZED GAINS. PORTFOLIO MANAGER'S REPORT______________________________________________________ Columbia Oregon Municipal Bond Fund For the six-month period ended February 28, 2005, Columbia Oregon Municipal Bond Fund class A shares returned 1.56% without sales charge. This was less than the fund's benchmark, the Lehman Brothers General Obligation Bond Index, which returned 1.85%. The fund also trailed its peer group, the Lipper Oregon Municipal Debt Funds Category, which returned an average of 1.95%. 1 The fund's focus on intermediate-maturity bonds, at a time when bonds with longer maturities provided higher returns, detracted from performance. VOLATILITY MARKED MUNICIPAL BOND RETURNS Municipal bond returns fluctuated over the past six months. As a result, returns for the period were relatively modest. The Federal Reserve Board (the Fed) raised short-term interest rates four times during the period, pushing the federal funds rate from 1.50% to 2.50%. 2 However, intermediate- and longer-term interest rates did not follow suit, in part because job growth was not as strong as expected. While the jobs data helped dampen investor concerns about inflation, a few inflationary signs, such as rising commodity prices, added some volatility to the markets. As a result, investors moved in and out of bonds in an attempt to take advantage of short-term price fluctuations. OREGON'S GROWTH IMPROVES, BUT LAGS OTHER STATES Oregon, like many other states, was helped by increased revenues resulting from an improving economy. However, the state's growth lagged the rest of the country, in part because it is still recovering from the downturn in the technology industry. Although state revenues have increased, we believe it could be some time before the state can sufficiently rebuild the reserves it needs to warrant an upgrade in its bond rating. HOSPITAL AND NON-RATED BONDS BENEFITED THE FUND The fund continued to benefit from holding hospital and lower-rated credits. As the financial outlook improved for hospitals, their bonds delivered solid returns. The fund's high-yield bonds also performed well. Although one issuer, the owner of an apartment complex, ran into financial difficulties, we were able to help negotiate the sale of the property, and redeploy the proceeds from the bonds into higher-quality, interest-earning assets. However, the picture for multifamily housing appears somewhat brighter as occupancy levels and profits have improved a little in recent months. 1 Lipper Inc., a widely respected data provider in the industry, calculates an average total return for mutual funds with similar investment objectives as those of the fund. 2 On March 22, 2005, the federal funds rate was increased to 2.75%. 52 [sidebar] PORTFOLIO QUALITY AS OF 02/28/05 (%) AAA 45.4 ----------------------------------------------- AA 35.5 ----------------------------------------------- A 4.9 ----------------------------------------------- BBB 4.2 ----------------------------------------------- Non rated 10.0 Ratings shown in the quality breakdown represent the rating assigned to a particular bond by one of the following nationally recognized rating agencies: Standard & Poor's, a division of The McGraw-Hill Companies, Inc., Moody's Investors Service, Inc. or Fitch Ratings Ltd. TOP 5 SECTORS AS OF 02/28/05 (%) Tax-backed 41.3 ----------------------------------------------- Other 17.5 ----------------------------------------------- Health care 12.3 ----------------------------------------------- Utilities 8.0 ----------------------------------------------- Housing 7.8 Your fund is actively managed and the sector breakdown of its portfolio will change over time. Sector breakdown and holdings discussed are calculated as a percentage of net assets. HOLDINGS DISCUSSED IN THIS REPORT AS OF 02/28/05 (%) Oregon Aquarium (Oregon State Health, Housing Educational & Cultural Facilities Authority) 0.1 MATURITY BREAKDOWN AS OF 02/28/05 (%) 0-1 years 0.3 ----------------------------------------------- 1-3 years 2.2 ----------------------------------------------- 3-5 years 3.9 ----------------------------------------------- 5-7 years 16.4 ----------------------------------------------- 7-10 years 29.6 ----------------------------------------------- 10-15 years 30.1 ----------------------------------------------- 15-20 years 12.0 ----------------------------------------------- 20-25 years 3.1 ----------------------------------------------- 25+ years 2.4 Portfolio quality and maturity breakdown are calculated as a percentage of total investments. ________________________________________________________________________________ Columbia Oregon Municipal Bond Fund The bonds of Oregon Aquarium continued to disappoint us. The Aquarium has experienced severe cash shortfalls as a result of declines in tourism and overspending to build new exhibits. We continue to work with the Aquarium to restructure the debt or find other ways to enhance the value of the outstanding bonds. POTENTIAL FOR STABLE-TO-IMPROVING MUNICIPAL BOND ENVIRONMENT We expect the Fed to continue to raise short-term interest rates in 2005 at a measured pace as it tries to manage inflation in the face of continuing economic growth. That growth, however, should mean higher tax revenues for most state and local governments, which would likely result in improved balance sheets and a relatively stable-to-improving rating environment for municipal bonds. We believe that Oregon may continue to have some budget problems. Yet, we expect its bonds to benefit from gradually increasing revenues, somewhat lower issuance and strong demand. In this environment, we expect to maintain the fund's focus on the intermediate maturity range, which we believe offers the best opportunity in an improving economic climate. Also, in an effort to increase net tax-free returns to all shareholders, we plan to continue to reduce the fund's exposure to bonds subject to the alternative minimum tax. [Photo of Brian McGreevy] Brian McGreevy has managed the Columbia Oregon Municipal Bond Fund since December 2003 and has been with the advisor and its predecessors or affiliate organizations since 1994. /s/ Brian McGreevy Tax-exempt investing offers current tax-exempt income, but it also involves special risks. The value of the fund will be affected by interest rate changes and the creditworthiness of issues held in the fund. When interest rates go up, bond prices generally drop and vice versa. Interest income from certain tax-exempt bonds may be subject to certain state and local taxes and, if applicable, the alternative minimum tax. Capital gains are not exempt from income taxes. Single-state municipal bond funds pose additional risks due to limited geographical diversification. 53 [sidebar] PERFORMANCE OF A $10,000 INVESTMENT 03/01/95 - 02/28/05 ($) SALES CHARGE WITHOUT WITH ----------------------------------------------- Class A 20,838 19,853 ----------------------------------------------- Class B 20,452 20,452 ----------------------------------------------- Class C 20,482 20,482 ----------------------------------------------- Class D 20,532 20,334 ----------------------------------------------- Class Z 20,972 n/a Performance data quoted represents past performance and current performance may be lower or higher. Past performance is no guarantee of future results. The investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than the original cost. Please visit www.columbiafunds.com for daily and most recent month-end performance updates. PERFORMANCE INFORMATION_________________________________________________________ Columbia High Yield Fund VALUE OF A $10,000 INVESTMENT 03/01/95 - 02/28/05 [MOUNTAIN CHART] CLASS A SHARES CLASS A SHARES MERRILL LYNCH US WITHOUT SALES WITH SALES HIGH YIELD, CASH CHARGE CHARGE PAY ONLY INDEX -------------- -------------- ---------------- 03/95 10000 9525 10000 10091 9612 10139 10317 9827 10376 10578 10076 10700 10651 10145 10781 10798 10285 10904 10817 10304 10971 10993 10471 11096 11138 10609 11175 11265 10730 11284 11446 10902 11466 11605 11054 11647 11644 11090 11664 11512 10965 11633 11496 10950 11639 11506 10960 11723 11538 10990 11793 11624 11072 11873 11845 11282 11995 12050 11477 12253 12182 11603 12388 12438 11847 12638 12526 11931 12736 12636 12036 12834 12829 12219 13013 12635 12035 12869 12784 12177 13016 13091 12469 13278 13256 12626 13480 13612 12966 13804 13600 12954 13780 13782 13128 14009 13770 13116 14102 13927 13265 14236 14116 13446 14371 14346 13665 14585 14431 13746 14645 14520 13831 14771 14593 13900 14840 14638 13943 14944 14742 14042 15019 14922 14213 15104 14330 13649 14452 14583 13891 14481 14513 13824 14243 14992 14280 14891 14997 14284 14896 15181 14460 15043 15098 14381 14929 15277 14552 15057 15386 14655 15292 15187 14466 15187 15140 14421 15158 15125 14407 15181 15040 14326 15026 15024 14310 14969 15027 14313 14880 15272 14546 15050 15353 14624 15128 15274 14549 15053 15288 14562 15066 15201 14479 14855 15271 14546 14860 15262 14537 14696 15582 14842 14947 15723 14976 15055 15988 15229 15239 15988 15229 15150 15854 15101 14706 15627 14885 14246 16060 15297 14555 16611 15822 15423 16751 15955 15666 16663 15872 15460 16623 15834 15291 16732 15937 15585 16584 15797 15264 16785 15988 15500 17003 16196 15651 16338 15562 14647 16899 16096 15078 17341 16518 15568 17126 16313 15458 17229 16411 15544 17072 16261 15395 17233 16414 15761 17314 16491 16012 17279 16458 15925 16840 16040 14793 16561 15774 14204 16818 16019 14559 16752 15956 14327 16730 15935 14206 17202 16385 15053 17315 16493 15282 17466 16636 15722 17604 16768 15925 17907 17056 16337 18313 17443 17255 18328 17457 17442 18552 17670 17918 18199 17335 17661 18321 17451 17893 18719 17830 18371 18928 18029 18745 19044 18139 19004 19249 18335 19445 19434 18511 19748 19508 18581 19740 19676 18741 19879 19503 18576 19735 19120 18212 19420 19287 18371 19703 19592 18661 19973 19952 19004 20335 20257 19295 20617 20541 19565 21009 20551 19575 21221 20627 19647 21537 20586 19608 21520 02/05 20838 19853 21820 The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The Merrill Lynch US High Yield, Cash Pay Only Index is an unmanaged index that tracks the performance of non-investment-grade corporate bonds. Unlike the fund, indices are not investments, do not incur fees or expenses and are not professionally managed. It is not possible to invest directly in an index. Securities in the fund may not match those in an index. AVERAGE ANNUAL TOTAL RETURN AS OF 02/28/05 (%)
SHARE CLASS A B C D Z ----------------------------------------------------------------------------------------------------------------- INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 10/01/93 ----------------------------------------------------------------------------------------------------------------- SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT ----------------------------------------------------------------------------------------------------------------- 6-month (cumulative) 4.42 -0.50 4.04 -0.96 4.12 3.12 4.12 3.05 4.54 ----------------------------------------------------------------------------------------------------------------- 1-year 6.80 1.70 6.00 1.00 6.19 5.19 6.16 5.08 7.05 ----------------------------------------------------------------------------------------------------------------- 5-year 6.38 5.35 5.99 5.68 6.02 6.02 6.07 5.86 6.52 ----------------------------------------------------------------------------------------------------------------- 10-year 7.62 7.10 7.42 7.42 7.43 7.43 7.46 7.36 7.69
AVERAGE ANNUAL TOTAL RETURN AS OF 12/31/04 (%)
SHARE CLASS A B C D Z ----------------------------------------------------------------------------------------------------------------- SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT ----------------------------------------------------------------------------------------------------------------- 6-month (cumulative) 6.94 1.90 6.54 1.54 6.64 5.64 6.62 5.50 7.07 ----------------------------------------------------------------------------------------------------------------- 1-year 7.16 2.02 6.36 1.36 6.53 5.53 6.51 5.43 7.42 ----------------------------------------------------------------------------------------------------------------- 5-year 6.08 5.06 5.71 5.41 5.74 5.74 5.79 5.59 6.21 ----------------------------------------------------------------------------------------------------------------- 10-year 7.94 7.42 7.75 7.75 7.76 7.76 7.79 7.68 8.00
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF 4.75% FOR CLASS A SHARES, MAXIMUM CONTINGENT DEFERRED SALES CHARGE OF 5.00% FOR CLASS B SHARES AND 1.00% FOR CLASS C AND D SHARES FOR THE FIRST YEAR ONLY. THE "WITHOUT SALES CHARGE" RETURNS DO NOT INCLUDE THE EFFECT OF SALES CHARGES. IF THEY HAD, RETURNS WOULD HAVE BEEN LOWER. ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS. CLASS Z SHARES ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT SHARE CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES ASSOCIATED WITH EACH CLASS. Effective October 13, 2003, class D shares were closed to all new investors and new accounts. Existing class D shareholders will be able to make additional purchases at any time. In addition, class D initial sales charge of 1.00% is waived after October 13, 2003. Performance results reflect any voluntary waivers or reimbursement of fund expenses by the advisor or its affiliates. Absent these waivers or reimbursement arrangements, performance results would have been lower. Classes A, B and D (newer class shares) share performance information includes returns of the fund's class Z shares (the oldest existing fund class) for periods prior to the inception of the newer class shares. The returns for class C include the returns of class B prior to 10/13/03, the date on which class C was initially offered by the fund. The returns shown for class C also include the performance of class Z prior to the inception of class B (11/01/02). Class Z share returns are not restated to reflect any expense differential (e.g., Rule 12b-1 fees) between class Z shares and the newer class shares. Had the expense differential been reflected, the returns for the periods prior to the inception of classes A, B, C and D would have been lower. 54 [sidebar] ESTIMATING YOUR ACTUAL EXPENSES To estimate the expenses that you paid over the period, first you will need your account balance at the end of the period: o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611 o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE 1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6 2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD," LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1. YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING THE PERIOD UNDERSTANDING YOUR EXPENSES_____________________________________________________ Columbia High Yield Fund As a fund shareholder, you incur two types of costs. There are transaction costs, which generally include sales charges on purchases and may include redemption or exchange fees. There are also ongoing costs, which generally include investment advisory fees, Rule 12b-1 fees, and other fund expenses. The information on this page is intended to help you understand your ongoing costs of investing in the fund and to compare these costs with the ongoing costs of investing in other mutual funds. ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS To illustrate these ongoing costs, we have provided an example and calculated the expenses paid by investors in each share class during the reporting period. The information in the following table is based on an initial investment of $1,000, which is invested at the beginning of the reporting period and held for the entire period. Expense information is calculated two ways and each method provides you with different information. The amount listed in the "actual" column is calculated using the fund's actual operating expenses and total return for the period. The amount listed in the "hypothetical" column for each share class assumes that the return each year is 5% before expenses and includes the fund's actual expense ratio. You should not use the hypothetical account values and expenses to estimate either your actual account balance at the end of the period or the expenses you paid during this reporting period. 09/01/04 - 02/28/05
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%) --------------------------------------------------------------------------------------------------------------------- ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL --------------------------------------------------------------------------------------------------------------------- Class A 1,000.00 1,000.00 1,044.18 1,019.98 4.92 4.86 0.97 --------------------------------------------------------------------------------------------------------------------- Class B 1,000.00 1,000.00 1,040.42 1,016.27 8.70 8.60 1.72 --------------------------------------------------------------------------------------------------------------------- Class C 1,000.00 1,000.00 1,041.21 1,017.01 7.95 7.85 1.57 --------------------------------------------------------------------------------------------------------------------- Class D 1,000.00 1,000.00 1,041.21 1,017.01 7.95 7.85 1.57 --------------------------------------------------------------------------------------------------------------------- Class Z 1,000.00 1,000.00 1,045.42 1,021.22 3.65 3.61 0.72
Expenses paid during the period are equal to the fund's annualized expense ratio, multiplied by the average account value over the period, then multiplied by the number of days in the fund's most recent fiscal half-year and divided by 365. Had the Fund's Distributor not waived a portion of expenses for class C and class D, total return would have been reduced. It is important to note that the expense amounts shown in the table are meant to highlight only ongoing costs of investing in the fund and do not reflect any transactional costs, such as sales charges, redemption or exchange fees. Therefore, the hypothetical examples provided may not help you determine the relative total costs of owning shares of different funds. If these transactional costs were included, your costs would have been higher. COMPARE WITH OTHER FUNDS Since all mutual fund companies are required to include the same hypothetical calculations about expenses in shareholder reports, you can use this information to compare the ongoing cost of investing in the fund with other funds. To do so, compare the 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds. As you compare hypothetical examples of other funds, it is important to note that hypothetical examples are meant to highlight the continuing cost of investing in a fund and do not reflect any transactional costs, such as sales charges or redemption or exchange fees. 55 [sidebar] SUMMARY o FOR THE SIX-MONTH PERIOD ENDED FEBRUARY 28, 2005, THE FUND'S CLASS A SHARES RETURNED 4.42% WITHOUT SALES CHARGE. o THE FUND'S EXPOSURE TO LOWER QUALITY BONDS WAS LESS THAN ITS BENCHMARK'S EXPOSURE, AND, WE BELIEVE, LESS THAN ITS PEER GROUP. AS A RESULT, THE FUND UNDERPERFORMED WHEN LOW QUALITY BONDS LED A HIGH YIELD RALLY LATE IN 2004. o THE FUND'S STRATEGY IS TO FOCUS ON HIGHER QUALITY SECURITIES, A PRUDENT APPROACH THAT HAS SERVED SHAREHOLDERS WELL OVER THE LONG TERM. [UP ARROW] [UP ARROW] MERRILL LYNCH US HIGH YIELD, CASH CLASS A SHARES PAY ONLY INDEX 4.42% 7.32% OBJECTIVE Seeks a high level of income, with capital appreciation as a secondary goal, by investing in non-investment-grade, corporate debt securities. TOTAL NET ASSETS $1,770.2 million NET ASSET VALUE PER SHARE AS OF 02/28/05 ($) Class A 8.81 ----------------------------------------------- Class B 8.81 ----------------------------------------------- Class C 8.81 ----------------------------------------------- Class D 8.81 ----------------------------------------------- Class Z 8.81 DISTRIBUTIONS DECLARED PER SHARE 09/01/04 - 02/28/05 ($) Class A 0.26 ----------------------------------------------- Class B 0.23 ----------------------------------------------- Class C 0.23 ----------------------------------------------- Class D 0.23 ----------------------------------------------- Class Z 0.27 PORTFOLIO MANAGERS' REPORT______________________________________________________ Columbia High Yield Fund For the six-month period ended February 28, 2005, Columbia High Yield Fund class A shares returned 4.42% without sales charge. The fund lagged the Merrill Lynch US High Yield, Cash Pay Only Index, which returned 7.32%, and the average return of its peer group, the Lipper High Current Yield Funds Category, which was 7.02%. 1 We believe that the fund underperformed relative to its benchmark and peer group because it emphasized higher quality credits at a time when investors favored lower quality segments of the market. However, we will continue to emphasize quality pursuant to the longstanding strategy of the fund. CORPORATE BALANCE SHEETS IMPROVED, INTEREST RATES DECLINED A strong economy enabled companies in the high-yield universe to improve their cash flows and to reduce their debt. As a result, corporate balance sheets improved and default rates continued to decline. The Moody's trailing 12-month issuer-based default rate--a widely monitored indicator of corporate credit quality--is now just 3%, down from 5% at the beginning of 2004 and nearly 11% three years ago. Although the Federal Reserve Board pushed short-term rates higher, long-term interest rates actually declined during the period. This favorable development surprised many market observers, which helped explain the strength of the high-yield rally in late 2004. The fund participated in this rally, but, consistent with its investment strategy, it did not have much exposure to the lower quality credits that led the rally. The CCC index was up 12.0% for the period, far above the 4.7% gain posted by the higher-quality intermediate BB index. ENERGY AND TELECOMMUNICATIONS HELPED BOOST PERFORMANCE The energy and telecommunications industries were strong performers during the period, and the fund added to its holdings in both categories. In the energy sector we purchased bonds issued by Hornbeck Offshore Services and MarkWest Energy Partners. Hornbeck operates a fleet of vessels that support oil exploration activity predominantly in the Gulf of Mexico. MarkWest is engaged in gathering, processing, transporting and storing natural gas and crude oil. In the telecommunication sector we added Rogers Wireless, the largest wireless provider in Canada. We believe Rogers has the potential to improve its financial position over the next few years because of rapid revenue growth and reduced competition. Steel companies rebounded with the economy in 2004, benefiting fund holding Russel Metals. One of our Select Medical bonds was another strong performer for the fund over the last six months. When the company was taken private, the prices at which the bonds were tendered for was above where they had been trading. 1 Lipper Inc., a widely respected data provider in the industry, calculates an average total return for mutual funds with similar investment objectives as those of the fund. 56 [sidebar] PORTFOLIO QUALITY AS OF 02/28/05 (%) Baa 1.0 ----------------------------------------------- Ba 61.1 ----------------------------------------------- B 35.4 ----------------------------------------------- Caa 2.5 Portfolio quality is calculated as a percentage of total investments. Ratings shown in the quality breakdown represent the lowest rating assigned to a particular bond by one of the following nationally recognized rating agencies: Standard & Poor's, a division of The McGraw-Hill Companies, Inc., Moody's Investors Service, Inc. or Fitch Ratings Ltd. TOP 5 SECTORS AS OF 02/28/05 (%) Consumer Cyclical 20.5 ----------------------------------------------- Consumer Non-Cyclical 17.5 ----------------------------------------------- Industrials 15.9 ----------------------------------------------- Communications 14.8 ----------------------------------------------- Energy 14.1 HOLDINGS DISCUSSED IN THIS REPORT AS OF 02/28/05 (%) Hornbeck Offshore Services 0.6 ----------------------------------------------- MarkWest Energy Partners 0.5 ----------------------------------------------- Rogers Wireless 1.3 ----------------------------------------------- Russel Metals 0.5 ----------------------------------------------- Select Medical 0.5 ----------------------------------------------- Allied Waste North America 1.0 MATURITY BREAKDOWN AS OF 02/28/05 (%) 0-3 years 0.1 ----------------------------------------------- 3-5 years 13.3 ----------------------------------------------- 5-10 years 82.1 ----------------------------------------------- 10-15 years 4.5 Your fund is actively managed and the sector breakdown of its portfolio will change over time. Sector breakdown, holdings discussed and maturity breakdown are calculated as a percentage of net assets. ________________________________________________________________________________ Columbia High Yield Fund ALLIED WASTE DISAPPOINTED One specific disappointment during the period was Allied Waste, a non-hazardous solid waste management company. Allied had difficulty controlling its expenses and produced several quarters of substandard earnings. Its rating was downgraded to Caa by Moody's in late 2004. We sold a portion of the holding, but the issue remains in the portfolio because we believe that the company has the potential to generate the free cash flow necessary to reduce its debt burden. EMPHASIS ON HIGHER QUALITY BONDS GOING FORWARD Looking ahead, we believe that the fund is well positioned with its emphasis on higher quality high-yield bonds. With the current yield advantage of lower quality bonds close to a historical low, investors no longer enjoy a significant yield premium for delving into riskier areas of the market. As the yield spread between lower quality and higher quality bonds narrows, we believe higher quality companies have the potential to perform well for the fund. [Photo of Jeffrey L. Rippey] Jeffrey L. Rippey, CFA, has managed or co-managed Columbia High Yield Fund since its inception in October 1993 and has been with the advisor or its predecessors or affiliate organizations since 1981. /s/ Jeffrey L. Rippey [Photo of Kurt M. Havnaer] Kurt M. Havnaer, CFA, has co-managed the fund since February 2000. He has been associated with the advisor or its predecessors or affiliate organizations since 1996. /s/ Kurt M. Havnaer Investing in fixed-income securities may involves certain risks, including the credit quality of individual issuers, possible prepayments, market or economic developments and yields and share price fluctuations due to changes in interest rates. When interest rates go up, bond prices typically drop, and vice versa. Investing in high yield securities (commonly known as "junk bonds") offers the potential for high current income and attractive total return but involves certain risks. Changes in economic conditions or other circumstances may adversely affect a junk bond issuer's ability to make principal and interest payments. Rising interest rates tend to lower the value of all bonds. 57 [sidebar] PERFORMANCE OF A $10,000 INVESTMENT 03/01/95 - 02/28/05 ($) SALES CHARGE WITHOUT ----------------------------------------------- Class Z 14,310 Performance data quoted represents past performance and current performance may be lowoer of higher. Past performance is no guarantee of future results. The investment return will fluctuate so that shares many be worth more or less than the original cost. Please visit www.columbiafunds.com for daily and most recent month-end performance updates. PERFORMANCE INFORMATION ________________________________________________________ Columbia Daily Income Company AVERAGE ANNUAL TOTAL RETURN AS OF 02/28/05 (%) CLASS Z LIPPER MONEY MARKET INCEPTION 11/03/74 FUNDS CATEGORY AVERAGE ------------------------------------------------------------------- 6-month (cumulative) 0.59 0.57 ------------------------------------------------------------------- 1-year 0.78 0.79 ------------------------------------------------------------------- 5-year 2.24 2.11 ------------------------------------------------------------------- 10-year 3.65 3.57 AVERAGE ANNUAL TOTAL RETURN AS OF 12/31/04 (%) LIPPER MONEY MARKET CLASS Z FUNDS CATEGORY AVERAGE ------------------------------------------------------------------- 6-month (cumulative) 0.42 0.43 ------------------------------------------------------------------- 1-year 0.57 0.60 ------------------------------------------------------------------- 5-year 2.37 2.23 ------------------------------------------------------------------- 10-year 3.71 3.64 ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS. CLASS Z SHARES ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. Performance results reflect any voluntary waivers or reimbursement of fund expenses by the advisor or its affiliates. Absent these waivers or reimbursement arrangements, performance results would have been lower. The table does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. An investment in the fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the fund seeks to preserve the value of your investment at $1 per share, it is possible to lose money by investing in the fund. 58 [sidebar] ESTIMATING YOUR ACTUAL EXPENSES To estimate the expenses that you paid over the period, first you will need your account balance at the end of the period: o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611 o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE 1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6 2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD," LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1. YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING THE PERIOD UNDERSTANDING YOUR EXPENSES_____________________________________________________ Columbia Daily Income Company As a fund shareholder, you incur two types of costs. There are transaction costs, which generally include sales charges on purchases and may include redemption or exchange fees. There are also ongoing costs, which generally include investment advisory fees and other fund expenses. The information on this page is intended to help you understand your ongoing costs of investing in the fund and to compare these costs with the ongoing costs of investing in other mutual funds. ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS To illustrate these ongoing costs, we have provided an example and calculated the expenses paid by investors in each share class during the reporting period. The information in the following table is based on an initial investment of $1,000, which is invested at the beginning of the reporting period and held for the entire period. Expense information is calculated two ways and each method provides you with different information. The amount listed in the "actual" column is calculated using the fund's actual operating expenses and total return for the period. The amount listed in the "hypothetical" column for each share class assumes that the return each year is 5% before expenses and includes the fund's actual expense ratio. You should not use the hypothetical account values and expenses to estimate either your actual account balance at the end of the period or the expenses you paid during this reporting period. 09/01/04 - 02/28/05
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%) -------------------------------------------------------------------------------------------------------------------------- ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL -------------------------------------------------------------------------------------------------------------------------- Class Z 1,000.00 1,000.00 1,005.90 1,020.83 3.98 4.01 0.80
Expenses paid during the period are equal to the fund's annualized expense ratio, multiplied by the average account value over the period, then multiplied by the number of days in the fund's most recent fiscal half-year and divided by 365. It is important to note that the expense amounts shown in the table are meant to highlight only ongoing costs of investing in the fund and do not reflect any transactional costs, such as sales charges, redemption or exchange fees. Therefore, the hypothetical examples provided may not help you determine the relative total costs of owning shares of different funds. If these transactional costs were included, your costs would have been higher. COMPARE WITH OTHER FUNDS Since all mutual fund companies are required to include the same hypothetical calculations about expenses in shareholder reports, you can use this information to compare the ongoing cost of investing in the fund with other funds. To do so, compare the 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds. As you compare hypothetical examples of other funds, it is important to note that hypothetical examples are meant to highlight the continuing cost of investing in a fund and do not reflect any transactional costs, such as sales charges or redemption or exchange fees. 59 [sidebar] SUMMARY o FOR THE SIX-MONTH PERIOD THAT ENDED FEBRUARY 28, 2005, THE FUND'S CLASS Z SHARES RETURNED 0.59%. THAT WAS COMPARABLE TO WHAT OTHER MONEY-MARKET FUNDS RETURNED DURING THE SAME PERIOD. o THE FEDERAL RESERVE BOARD (THE FED) INTERVENED ON FOUR OCCASIONS DURING THE PERIOD TO PUSH SHORT-TERM INTEREST RATES HIGHER. o A MOVE TO FLOATING-RATE NOTES ENABLED THE PORTFOLIO TO BENEFIT FROM THE FED'S ACTIONS. [UP ARROW] [UP ARROW] LIPPER MONEY MARKET FUNDS CLASS Z SHARES CATEGORY 0.59% 0.57% OBJECTIVE Seeks a high level of income consistent with the maintenance of liquidity and the preservation of capital by investing primarily in high quality money market securities TOTAL NET ASSETS $546.2 million NET ASSET VALUE PER SHARE AS OF 02/28/05 ($) Class Z 1.00 DISTRIBUTIONS DECLARED PER SHARE 09/01/04 - 02/28/05 ($) Class Z 0.006 PORTFOLIO MANAGER'S REPORT______________________________________________________ Columbia Daily Income Company For the six-month period ended February 28, 2005, Columbia Daily Income Company class Z shares returned 0.59%. This return was slightly higher than the Lipper Money Market Funds Category, which averaged a gain of 0.57% for the period. 1 Short-term rates began the period near their historical low but moved higher throughout the period. A SLOW TREND TO HIGHER RATES A sustained effort by the Fed to push short-term interest rates higher was the key driver of fund returns for the period. On four separate occasions, the Fed's policymakers intervened to raise the federal funds rate, a key overnight lending rate for banks, by one-quarter of a percentage point. The fed funds rate climbed from 1.50% to 2.50% by the end of the period. 2 The Fed intervened in order to manage the growth of the overall economy and to contain inflation. Because commercial borrowing, credit-card rates and even adjustable-rate mortgages are all tied to short-term rates, a rise in rates tends to slow the economy and inflation tends to remain low when economic growth is steady to slow. Prior to last summer, rates had been kept artificially low as an economic stimulus, but subsequent growth has allowed for a gradual return to a more neutral level. MOVING TO FLOATING-RATE NOTES During the period, we moved a significant portion of the fund's holdings--approximately two-thirds of its assets--into floating-rate securities. The yields on floating-rate notes are typically linked to LIBOR (London Interbank Offered Rate) and they adjust weekly, monthly or quarterly. Because these yields are automatically reset higher when short-term interest rates increase, they have been well-suited to the Fed's repeated actions. Floating-rate notes can take many forms, including corporate debt and taxable municipal securities. 1 Lipper Inc., a widely respected data provider in the industry, calculates an average total return for mutual funds with similar investment objectives as those of the fund. 2 On March 22, 2005, the federal funds rate increased to 2.75%. 60 [sidebar] PORTFOLIO HIGHLIGHTS AS OF 02/28/05 Seven day current yield 1.74% ------------------------------------------------ Seven day effective yield 1.75% ------------------------------------------------ Average days to maturity 26 ________________________________________________________________________________ Columbia Daily Income Company TRACKING THE FED Because increases in the fed funds rate affect the interactions of the entire range of short-term securities, we have kept a close watch over the weighted average maturity of the portfolio. As a rule, we have shortened the portfolio's weighted average maturity in an effort to capture interest-rate hikes as they occur, while buying longer securities when warranted by our analysis. The fund's weighted average maturity was 26 days at the end of the period. Going forward, we will continue to monitor both the short-term marketplace and investor expectations. We will continue to focus our efforts on achieving the highest possible short-term yields in accordance with our rigorous quality standards. [Photo of Karen Arneil] Karen Arneil has managed the fund since October 2004 and has been with the advisor or its predecessors or affiliate organizations since 1996. /s/ Karen Arneil There is a chance that the fund's investments may not keep pace with the rate of inflation over the long term. Also, an investment in the fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the fund seeks to preserve the value of your investment at $1 per share, it is possible to lose money by investing in the fund. 61 [sidebar] FINANCIAL STATEMENTS____________________________________________________________ February 28, 2005 Columbia Funds
A GUIDE TO UNDERSTANDING YOUR FUND'S FINANCIAL STATEMENTS --------------------------------------------------------------------------------------------------------- INVESTMENT PORTFOLIO The investment portfolio details all of the fund's holdings and their market value as of the last day of the reporting period. Portfolio holdings are organized by type of asset, industry, country or geographic region (if applicable) to demonstrate areas of concentration and diversification. --------------------------------------------------------------------------------------------------------- STATEMENT OF ASSETS AND LIABILITIES This statement details the fund's assets, liabilities, net assets and share price for each share class as of the last day of the reporting period. Net assets are calculated by subtracting all the fund's liabilities (including any unpaid expenses) from the total of the fund's investment and non-investment assets. The share price for each class is calculated by dividing net assets for that class by the number of shares outstanding in that class as of the last day of the reporting period. --------------------------------------------------------------------------------------------------------- STATEMENT OF OPERATIONS This statement details income earned by the fund and the expenses accrued by the fund during the reporting period. The Statement of Operations also shows any net gain or loss the fund realized on the sales of its holdings during the period, as well as any unrealized gains or losses recognized over the period. The total of these results represents the fund's net increase or decrease in net assets from operations. --------------------------------------------------------------------------------------------------------- STATEMENT OF CHANGES IN NET ASSETS This statement demonstrates how the fund's net assets were affected by its operating results, distributions to shareholders and shareholder transactions (e.g., subscriptions, redemptions and dividend reinvestments) during the reporting period. The Statement of Changes in Net Assets also details changes in the number of shares outstanding. --------------------------------------------------------------------------------------------------------- NOTES TO FINANCIAL STATEMENTS These notes disclose the organizational background of the fund, its significant accounting policies (including those surrounding security valuation, income recognition and distributions to shareholders), federal tax information, fees and compensation paid to affiliates and significant risks and contingencies. --------------------------------------------------------------------------------------------------------- FINANCIAL HIGHLIGHTS The financial highlights demonstrate how the fund's net asset value per share was affected by the fund's operating results. The financial highlights table also discloses the classes' performance and certain key ratios (e.g., class expenses and net investment income as a percentage of average net assets).
62 This page intentionally left blank. INVESTMENT PORTFOLIO ___________________________________________________________ February 28, 2005 (Unaudited) Columbia Common Stock Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - 96.6% CONSUMER DISCRETIONARY - 19.6% AUTOMOBILES - 1.9% General Motors Corp. 124,380 4,436,634 ------------- Automobiles Total 4,436,634 HOTELS, RESTAURANTS & LEISURE - 0.9% Darden Restaurants, Inc. 74,300 1,991,240 ------------- Hotels, Restaurants & Leisure Total 1,991,240 INTERNET & CATALOG RETAIL - 1.5% Amazon.com, Inc. (a) 65,640 2,309,215 eBay, Inc. (a) 28,840 1,235,506 ------------- Internet & Catalog Retail Total 3,544,721 LEISURE EQUIPMENT & PRODUCTS - 0.7% Hasbro, Inc. 73,860 1,559,923 ------------- Leisure Equipment & Products Total 1,559,923 MEDIA - 11.0% Clear Channel Communications, Inc. 41,180 1,370,470 Comcast Corp., Class A (a) 143,282 4,663,829 DirecTV Group, Inc. (a) 242,010 3,632,570 Liberty Media Corp., Class A (a) 414,140 4,199,380 Liberty Media International, Inc., Class A (a) 23,173 1,001,769 News Corp., Class A 126,190 2,099,802 Time Warner, Inc. (a) 273,070 4,704,996 Viacom, Inc., Class B 98,750 3,446,375 ------------- Media Total 25,119,191 MULTILINE RETAIL - 2.1% Kohl's Corp. (a) 53,480 2,560,088 May Department Stores Co. 63,800 2,201,738 ------------- Multiline Retail Total 4,761,826 SPECIALTY RETAIL - 1.5% RadioShack Corp. 112,950 3,338,802 ------------- Specialty Retail Total 3,338,802 ------------- CONSUMER DISCRETIONARY TOTAL 44,752,337 CONSUMER STAPLES - 5.1% BEVERAGES - 0.5% Coca-Cola Co. 27,790 1,189,412 ------------- Beverages Total 1,189,412 FOOD & STAPLES RETAILING - 1.6% Wal-Mart Stores, Inc. 69,760 3,600,313 ------------- Food & Staples Retailing Total 3,600,313 FOOD PRODUCTS - 0.7% Sara Lee Corp. 70,310 1,574,944 ------------- Food Products Total 1,574,944 SHARES VALUE ($) ------- ------------- HOUSEHOLD PRODUCTS - 1.1% Colgate-Palmolive Co. 46,140 2,441,729 ------------- Household Products Total 2,441,729 TOBACCO - 1.2% Altria Group, Inc. 41,375 2,716,269 ------------- Tobacco Total 2,716,269 ------------- CONSUMER STAPLES TOTAL 11,522,667 ENERGY - 3.9% ENERGY EQUIPMENT & SERVICES - 0.9% Transocean, Inc. (a) 44,550 2,159,784 ------------- Energy Equipment & Services Total 2,159,784 OIL & GAS - 3.0% Anadarko Petroleum Corp. 29,330 2,254,304 BP PLC, ADR 22,110 1,435,381 Devon Energy Corp. 66,960 3,133,058 ------------- Oil & Gas Total 6,822,743 ------------- ENERGY TOTAL 8,982,527 FINANCIALS - 16.4% CAPITAL MARKETS - 2.2% A.G. Edwards, Inc. 36,510 1,573,946 E*TRADE Financial Corp. (a) 110,950 1,472,307 Morgan Stanley 34,860 1,968,544 ------------- Capital Markets Total 5,014,797 COMMERCIAL BANKS - 0.9% Fifth Third Bancorp 47,030 2,105,533 ------------- Commercial Banks Total 2,105,533 CONSUMER FINANCE - 1.1% American Express Co. 46,040 2,493,066 ------------- Consumer Finance Total 2,493,066 DIVERSIFIED FINANCIAL SERVICES - 3.3% Citigroup, Inc. 82,409 3,932,557 JPMorgan Chase & Co. 97,642 3,568,815 ------------- Diversified Financial Services Total 7,501,372 INSURANCE - 6.4% Ace Ltd. 70,830 3,149,102 Allstate Corp. 29,010 1,557,257 Berkshire Hathaway, Inc., Class B (a) 1,209 3,645,135 Chubb Corp. 18,805 1,487,663 UnumProvident Corp. 279,730 4,733,032 ------------- Insurance Total 14,572,189 THRIFTS & MORTGAGE FINANCE - 2.5% MGIC Investment Corp. 90,390 5,671,069 ------------- Thrifts & Mortgage Finance Total 5,671,069 ------------- FINANCIALS TOTAL 37,358,026 64 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Common Stock Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - (CONTINUED) HEALTH CARE - 11.7% BIOTECHNOLOGY - 1.3% Amgen, Inc. (a) 27,132 1,671,603 MedImmune, Inc. (a) 58,790 1,415,663 ------------- Biotechnology Total 3,087,266 HEALTH CARE PROVIDERS & SERVICES - 3.8% Cardinal Health, Inc. 56,800 3,325,640 McKesson Corp. 30,970 1,156,420 WebMD Corp. (a) 554,020 4,177,311 ------------- Health Care Providers & Services Total 8,659,371 PHARMACEUTICALS - 6.6% Barr Pharmaceuticals, Inc. (a) 104,000 4,964,960 Biovail Corp. (a) 150,590 2,415,463 Eli Lilly & Co. 20,020 1,121,120 Endo Pharmaceuticals Holdings, Inc. (a) 110,330 2,485,735 IVAX Corp. (a) 95,430 1,525,926 Pfizer, Inc. 92,904 2,442,446 ------------- Pharmaceuticals Total 14,955,650 ------------- HEALTH CARE TOTAL 26,702,287 INDUSTRIALS - 6.2% AIRLINES - 1.4% Southwest Airlines Co. 225,730 3,126,360 ------------- Airlines Total 3,126,360 COMMERCIAL SERVICES & SUPPLIES - 2.2% ARAMARK Corp., Class B 49,260 1,380,758 Cintas Corp. 28,300 1,238,974 Waste Management, Inc. 81,045 2,369,756 ------------- Commercial Services & Supplies Total 4,989,488 CONSTRUCTION & ENGINEERING - 0.7% Jacobs Engineering Group, Inc. (a) 27,710 1,551,206 ------------- Construction & Engineering Total 1,551,206 MACHINERY - 1.0% Dover Corp. 61,900 2,393,673 ------------- Machinery Total 2,393,673 ROAD & RAIL - 0.9% Union Pacific Corp. 32,020 2,031,669 ------------- Road & Rail Total 2,031,669 ------------- INDUSTRIALS TOTAL 14,092,396 SHARES VALUE ($) ------- ------------- INFORMATION TECHNOLOGY - 19.5% COMMUNICATIONS EQUIPMENT - 3.0% Cisco Systems, Inc. (a) 112,490 1,959,576 Corning, Inc. (a) 100,360 1,151,129 Lucent Technologies, Inc. (a) 285,540 876,608 Nortel Networks Corp. (a) 1,035,580 2,775,354 ------------- Communications Equipment Total 6,762,667 COMPUTERS & PERIPHERALS - 6.6% Hewlett-Packard Co. 182,180 3,789,344 International Business Machines Corp. 48,285 4,470,226 SanDisk Corp. (a) 191,090 5,136,499 Sun Microsystems, Inc. (a) 412,560 1,741,003 ------------- Computers & Peripherals Total 15,137,072 ELECTRONIC EQUIPMENT & INSTRUMENTS - 0.5% Agilent Technologies, Inc. (a) 52,720 1,265,280 ------------- Electronic Equipment & Instruments Total 1,265,280 SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 5.3% Analog Devices, Inc. 31,850 1,169,532 Broadcom Corp., Class A (a) 41,400 1,335,150 Intel Corp. 193,260 4,634,375 Linear Technology Corp. 96,120 3,754,447 Maxim Integrated Products, Inc. 26,560 1,142,611 ------------- Semiconductors & Semiconductor Equipment Total 12,036,115 SOFTWARE - 4.1% Fair Isaac Corp. 35,450 1,198,210 Microsoft Corp. 206,010 5,187,332 Oracle Corp. (a) 221,930 2,865,116 ------------- Software Total 9,250,658 ------------- INFORMATION TECHNOLOGY TOTAL 44,451,792 MATERIALS - 9.2% CHEMICALS - 2.3% E.I. du Pont de Nemours & Co. 99,650 5,311,345 ------------- Chemicals Total 5,311,345 CONTAINERS & PACKAGING - 3.5% Sealed Air Corp. (a) 65,290 3,412,708 Smurfit-Stone Container Corp. (a) 269,990 4,489,934 ------------- Containers & Packaging Total 7,902,642 METALS & MINING - 2.9% Alcoa, Inc. 96,560 3,101,507 International Steel Group, Inc. (a) 83,740 3,496,145 ------------- Metals & Mining Total 6,597,652 PAPER & FOREST PRODUCTS - 0.5% Sappi Ltd., ADR 85,700 1,150,094 ------------- Paper & Forest Products Total 1,150,094 ------------- MATERIALS TOTAL 20,961,733 See Accompanying Notes to Financial Statements. | 65 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Common Stock Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - (CONTINUED) TELECOMMUNICATION SERVICES - 5.0% DIVERSIFIED TELECOMMUNICATION SERVICES - 3.9% Brasil Telecom Participacoes SA, ADR 7,190 244,460 CenturyTel, Inc. 42,570 1,432,055 Qwest Communications International, Inc. (a) 555,880 2,167,932 Telefonos de Mexico SA de CV, ADR 58,850 2,307,509 Verizon Communications, Inc. 78,500 2,823,645 ------------- Diversified Telecommunication Services Total 8,975,601 WIRELESS TELECOMMUNICATION SERVICES - 1.1% Nextel Communications, Inc., Class A (a) 84,110 2,475,357 ------------- Wireless Telecommunication Services Total 2,475,357 ------------- TELECOMMUNICATION SERVICES TOTAL 11,450,958 Total Common Stocks (Cost of $197,668,246) 220,274,723 SHORT-TERM OBLIGATION - 0.2% PAR ($) Repurchase agreement with State Street Bank & Trust Co., dated 02/28/05, due 03/01/05 at 2.500%, collateralized by a U.S. Treasury Note maturing 09/30/06, market value of $537,585 (repurchase proceeds $525,036) 525,000 525,000 ------------- TOTAL SHORT-TERM OBLIGATION (COST OF $525,000) 525,000 TOTAL INVESTMENTS - 96.8% (COST OF $198,193,246) (b) 220,799,723 OTHER ASSETS & LIABILITIES, NET - 3.2% 7,249,018 NET ASSETS - 100.0% 228,048,741 NOTES TO INVESTMENT PORTFOLIO: (a) Non-income producing security. (b) Cost for federal income tax purposes is $198,193,246. At February 28, 2005, the Fund held investments in the following sectors: % OF SECTOR NET ASSETS ---------------------------------------------------------------------- Consumer Discretionary 19.6% Information Technology 19.5 Financials 16.4 Health Care 11.7 Materials 9.2 Industrials 6.2 Consumer Staples 5.1 Telecommunication Services 5.0 Energy 3.9 Short-Term Obligation 0.2 Other Assets & Liabilities, Net 3.2 ----- 100.0% ===== ACRONYM NAME ------- ---- ADR American Depositary Receipt 66 | See Accompanying Notes to Financial Statements. INVESTMENT PORTFOLIO ___________________________________________________________ February 28, 2005 (Unaudited) Columbia Growth Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - 97.6% CONSUMER DISCRETIONARY - 17.6% HOTELS, RESTAURANTS & LEISURE - 4.8% Carnival Corp. 156,010 8,483,824 Hilton Hotels Corp. 342,890 7,221,263 Marriott International, Inc., Class A 225,870 14,478,267 McDonald's Corp. 165,220 5,465,478 ------------- Hotels, Restaurants & Leisure Total 35,648,832 INTERNET & CATALOG RETAIL - 1.3% eBay, Inc. (a) 217,400 9,313,416 ------------- Internet & Catalog Retail Total 9,313,416 MEDIA - 2.3% Omnicom Group 64,110 5,838,498 XM Satellite Radio Holdings, Inc., Class A (a) 327,120 10,781,875 ------------- Media Total 16,620,373 MULTILINE RETAIL - 1.4% Nordstrom, Inc. 197,100 10,596,096 ------------- Multiline Retail Total 10,596,096 SPECIALTY RETAIL - 5.9% Best Buy Co., Inc. 136,890 7,394,798 Chico's FAS, Inc. (a) 321,080 9,455,806 Home Depot, Inc. 276,080 11,048,721 Lowe's Companies, Inc. 99,810 5,866,832 Staples, Inc. 315,890 9,956,853 ------------- Specialty Retail Total 43,723,010 TEXTILES, APPAREL & LUXURY GOODS - 1.9% Coach, Inc. (a) 145,350 8,071,285 NIKE, Inc., Class B 66,800 5,808,260 ------------- Textiles, Apparel & Luxury Goods Total 13,879,545 ------------- CONSUMER DISCRETIONARY TOTAL 129,781,272 CONSUMER STAPLES - 12.0% BEVERAGES - 2.0% PepsiCo, Inc. 272,690 14,687,084 ------------- Beverages Total 14,687,084 FOOD & STAPLES RETAILING - 1.2% Sysco Corp. 56,480 1,944,042 Wal-Mart Stores, Inc. 139,040 7,175,854 ------------- Food & Staples Retailing Total 9,119,896 FOOD PRODUCTS - 0.6% Hershey Foods Corp. 72,940 4,595,220 ------------- Food Products Total 4,595,220 SHARES VALUE ($) ------- ------------- HOUSEHOLD PRODUCTS - 1.9% Procter & Gamble Co. 261,360 13,875,602 ------------- Household Products Total 13,875,602 PERSONAL PRODUCTS - 4.7% Alberto-Culver Co. 261,775 13,682,979 Avon Products, Inc. 302,740 12,948,190 Gillette Co. 164,920 8,287,230 ------------- Personal Products Total 34,918,399 TOBACCO - 1.6% Altria Group, Inc. 175,780 11,539,957 ------------- Tobacco Total 11,539,957 ------------- CONSUMER STAPLES TOTAL 88,736,158 ENERGY - 2.1% ENERGY EQUIPMENT & SERVICES - 1.2% National-Oilwell, Inc. (a) 121,670 5,516,518 Smith International, Inc. (a) 52,640 3,382,646 ------------- Energy Equipment & Services Total 8,899,164 OIL & GAS - 0.9% EOG Resources, Inc. 73,030 6,654,494 ------------- Oil & Gas Total 6,654,494 ------------- ENERGY TOTAL 15,553,658 FINANCIALS - 7.3% CAPITAL MARKETS - 2.0% Goldman Sachs Group, Inc. 96,440 10,492,672 Merrill Lynch & Co., Inc. 75,960 4,449,737 ------------- Capital Markets Total 14,942,409 COMMERCIAL BANKS - 1.5% North Fork Bancorporation, Inc. 104,050 2,997,681 Wells Fargo & Co. 131,600 7,814,408 ------------- Commercial Banks Total 10,812,089 CONSUMER FINANCE - 0.4% MBNA Corp. 127,560 3,236,197 ------------- Consumer Finance Total 3,236,197 DIVERSIFIED FINANCIAL SERVICES - 1.8% Citigroup, Inc. 275,006 13,123,286 ------------- Diversified Financial Services Total 13,123,286 INSURANCE - 1.6% American International Group, Inc. 103,600 6,920,480 Prudential Financial, Inc. 82,560 4,705,920 ------------- Insurance Total 11,626,400 ------------- FINANCIALS TOTAL 53,740,381 See Accompanying Notes to Financial Statements. | 67 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Growth Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - (CONTINUED) HEALTH CARE - 25.7% BIOTECHNOLOGY - 2.0% Amgen, Inc. (a) 117,730 7,253,345 Biogen Idec, Inc. (a) 53,740 2,077,051 Genentech, Inc. (a) 68,980 3,255,856 Gilead Sciences, Inc. (a) 65,220 2,253,351 ------------- Biotechnology Total 14,839,603 HEALTH CARE EQUIPMENT & SUPPLIES - 8.6% Alcon, Inc. 89,690 7,740,247 Cooper Companies, Inc. 99,737 8,213,342 Kinetic Concepts, Inc. (a) 117,160 7,642,347 St. Jude Medical, Inc. (a) 203,550 7,958,805 Thermo Electron Corp. (a) 266,700 7,323,582 Varian Medical Systems, Inc. (a) 391,390 14,062,643 Zimmer Holdings, Inc. (a) 125,290 10,762,411 ------------- Health Care Equipment & Supplies Total 63,703,377 HEALTH CARE PROVIDERS & SERVICES - 3.6% Caremark Rx, Inc. (a) 149,130 5,708,697 UnitedHealth Group, Inc. 127,540 11,626,546 WellPoint, Inc. (a) 75,740 9,244,824 ------------- Health Care Providers & Services Total 26,580,067 PHARMACEUTICALS - 11.5% Abbott Laboratories 290,340 13,352,736 IVAX Corp. (a) 113,250 1,810,867 Johnson & Johnson 472,170 30,974,352 Novartis AG, ADR 235,310 11,758,441 Pfizer, Inc. 592,513 15,577,167 Teva Pharmaceutical Industries Ltd., ADR 368,126 11,084,274 ------------- Pharmaceuticals Total 84,557,837 ------------- HEALTH CARE TOTAL 189,680,884 INDUSTRIALS - 9.9% AEROSPACE & DEFENSE - 1.0% Honeywell International, Inc. 96,180 3,651,955 United Technologies Corp. 39,550 3,950,254 ------------- Aerospace & Defense Total 7,602,209 BUILDING PRODUCTS - 1.5% American Standard Co., Inc. (a) 246,810 11,303,898 ------------- Building Products Total 11,303,898 ELECTRICAL EQUIPMENT - 1.0% Rockwell Automation, Inc. 121,040 7,522,636 ------------- Electrical Equipment Total 7,522,636 INDUSTRIAL CONGLOMERATES - 4.7% General Electric Co. 411,255 14,476,176 Tyco International Ltd. 590,890 19,782,997 ------------- Industrial Conglomerates Total 34,259,173 SHARES VALUE ($) ------- ------------- MACHINERY - 1.7% Ingersoll-Rand Co., Ltd., Class A 95,200 8,020,600 ITT Industries, Inc. 50,270 4,421,246 ------------- Machinery Total 12,441,846 ------------- INDUSTRIALS TOTAL 73,129,762 INFORMATION TECHNOLOGY - 23.0% COMMUNICATIONS EQUIPMENT - 4.2% Avaya, Inc. (a) 155,220 2,173,080 Cisco Systems, Inc. (a) 881,805 15,361,043 Nokia Oyj, ADR 243,350 3,927,669 QUALCOMM, Inc. 276,470 9,983,332 ------------- Communications Equipment Total 31,445,124 COMPUTERS & PERIPHERALS - 4.9% Dell, Inc. (a) 373,150 14,959,584 EMC Corp. (a) 315,750 3,997,395 International Business Machines Corp. 183,040 16,945,843 ------------- Computers & Peripherals Total 35,902,822 INTERNET SOFTWARE & SERVICES - 1.2% Yahoo!, Inc. (a) 276,960 8,937,499 ------------- Internet Software & Services Total 8,937,499 IT SERVICES - 1.0% Automatic Data Processing, Inc. 63,590 2,731,826 Cognizant Technology Solutions Corp., Class A (a) 97,350 4,597,841 ------------- IT Services Total 7,329,667 SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 6.6% Altera Corp. (a) 333,730 6,921,560 ASML Holding N.V., N.Y. Registered Shares (a) 254,650 4,665,188 Intel Corp. 707,870 16,974,723 Linear Technology Corp. 50,630 1,977,608 National Semiconductor Corp. 224,890 4,486,555 Taiwan Semiconductor Manufacturing Co., Ltd., ADR 411,520 3,753,062 Teradyne, Inc. (a) 249,830 3,852,379 Texas Instruments, Inc. 226,950 6,007,367 ------------- Semiconductors & Semiconductor Equipment Total 48,638,442 SOFTWARE - 5.1% Amdocs Ltd. (a) 119,800 3,516,130 Microsoft Corp. 1,001,740 25,223,813 Oracle Corp. (a) 399,260 5,154,447 Symantec Corp. (a) 158,940 3,498,269 ------------- Software Total 37,392,659 ------------- INFORMATION TECHNOLOGY TOTAL 169,646,213 Total Common Stocks (Cost of $629,069,323) 720,268,328 68 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Growth Fund SHARES VALUE ($) ------- ------------- PREFERRED STOCK - 0.3% CONSUMER DISCRETIONARY - 0.3% MEDIA - 0.3% News Corp., Ltd., ADR 132,810 2,209,958 ------------- Media Total 2,209,958 ------------- CONSUMER DISCRETIONARY TOTAL 2,209,958 Total Preferred Stock (Cost of $2,269,275) 2,209,958 TOTAL INVESTMENTS - 97.9% (COST OF $631,338,598) (b) 722,478,286 OTHER ASSETS & LIABILITIES, NET - 2.1% 15,154,759 NET ASSETS - 100.0% 737,633,045 NOTES TO INVESTMENT PORTFOLIO: (a) Non-income producing security. (b) Cost for federal income tax purposes is $631,338,598. At February 28, 2005, the Fund held investments in the following sectors: % OF SECTOR NET ASSETS ---------------------------------------------------------------- Health Care 25.7% Information Technology 23.0 Consumer Discretionary 17.9 Consumer Staples 12.0 Industrials 9.9 Financials 7.3 Energy 2.1 Other Assets & Liabilities, Net 2.1 ----- 100.0% ===== ACRONYM NAME ------- ---- ADR American Depositary Receipt See Accompanying Notes to Financial Statements. | 69 INVESTMENT PORTFOLIO ___________________________________________________________ February 28, 2005 (Unaudited) Columbia International Stock Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - 97.9% CONSUMER DISCRETIONARY - 12.1% AUTO COMPONENTS - 1.1% Continental AG 55,000 4,069,163 Denso Corp. 121,400 3,114,521 ------------- Auto Components Total 7,183,684 AUTOMOBILES - 2.7% Nissan Motor Co., Ltd. 223,500 2,397,498 Renault SA 80,341 7,270,451 Toyota Motor Corp. 221,300 8,613,672 ------------- Automobiles Total 18,281,621 HOTELS, RESTAURANTS & LEISURE - 0.3% Carnival Corp. 41,700 2,267,646 ------------- Hotels, Restaurants & Leisure Total 2,267,646 HOUSEHOLD DURABLES - 3.3% Daiwa House Industry Co., Ltd. 182,000 2,067,198 Koninklijke (Royal) Philips Electronics NV 194,900 5,387,907 Matsushita Electric Industrial Co., Ltd. 420,000 6,279,545 Pioneer Corp. 143,000 2,521,642 Sekisui Chemical Co., Ltd. 384,000 2,856,211 Sharp Corp. 215,000 3,416,991 ------------- Household Durables Total 22,529,494 LEISURE EQUIPMENT & PRODUCTS - 1.1% Fuji Photo Film Co., Ltd. 188,000 7,121,347 ------------- Leisure Equipment & Products Total 7,121,347 MEDIA - 2.7% JC Decaux SA (a) 78,500 2,018,624 Mediaset S.p.A. 145,000 2,040,954 News Corp., Class B 218,700 3,763,827 Pearson PLC 627,100 7,679,455 Vivendi Universal SA (a) 86,000 2,715,899 ------------- Media Total 18,218,759 TEXTILES, APPAREL & LUXURY GOODS - 0.9% Burberry Group PLC 544,846 4,127,561 Swatch Group AG, Registered Shares 77,400 2,156,227 ------------- Textiles, Apparel & Luxury Goods Total 6,283,788 ------------- CONSUMER DISCRETIONARY TOTAL 81,886,339 CONSUMER STAPLES - 8.7% BEVERAGES - 1.5% Diageo PLC 430,350 6,123,279 SABMiller PLC 262,079 4,326,129 ------------- Beverages Total 10,449,408 FOOD & STAPLES RETAILING - 1.3% Ito-Yokado Co., Ltd. 85,000 3,522,118 Metro AG 93,688 5,256,910 ------------- Food & Staples Retailing Total 8,779,028 SHARES VALUE ($) ------- ------------- FOOD PRODUCTS - 2.8% Nestle SA, Registered Shares 44,797 12,436,369 Royal Numico NV (a) 50,700 2,047,030 Unilever PLC 495,220 4,732,932 ------------- Food Products Total 19,216,331 HOUSEHOLD PRODUCTS - 1.9% Kao Corp. 113,000 2,685,247 Reckitt Benckiser PLC 312,064 9,818,017 ------------- Household Products Total 12,503,264 TOBACCO - 1.2% Imperial Tobacco Group PLC 191,397 5,100,771 Japan Tobacco, Inc. 289 3,142,584 ------------- Tobacco Total 8,243,355 ------------- CONSUMER STAPLES TOTAL 59,191,386 ENERGY - 9.9% ENERGY EQUIPMENT & SERVICES - 0.7% Saipem S.p.A. 193,600 2,620,923 Stolt Offshore SA (a) 244,600 1,934,318 ------------- Energy Equipment & Services Total 4,555,241 OIL & GAS - 9.2% BG Group PLC 707,277 5,546,850 BP PLC, ADR 227,930 14,797,216 EnCana Corp. 159,800 10,599,780 ENI S.p.A. 383,550 10,029,042 Norsk Hydro ASA 38,280 3,310,485 OMV AG 6,200 2,148,931 Shell Transport & Trading Co., PLC 569,000 5,334,398 Total SA 45,590 10,850,575 ------------- Oil & Gas Total 62,617,277 ------------- ENERGY TOTAL 67,172,518 FINANCIALS - 24.7% CAPITAL MARKETS - 1.8% Credit Suisse Group 62,500 2,721,478 Deutsche Bank AG, Registered Shares 77,898 6,839,822 Nomura Holdings, Inc. 191,000 2,643,173 ------------- Capital Markets Total 12,204,473 COMMERCIAL BANKS - 15.3% ABN AMRO Holding NV 231,770 6,391,685 Anglo Irish Bank Corp., PLC 206,000 5,428,563 Australia & New Zealand Banking Group Ltd. 120,100 2,028,569 Banco Bilbao Vizcaya Argentaria SA 238,500 4,122,776 Banco de Sabadell SA 104,203 2,656,894 Banco Popolare di Verona E Novara 211,600 4,145,150 Banco Popular Espanol SA 60,780 4,207,911 Bank of Ireland 307,856 5,159,260 Bank of Yokohama Ltd. 425,000 2,612,185 Barclays PLC 773,410 8,383,140 BNP Paribas SA 92,354 6,700,885 70 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia International Stock Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - (CONTINUED) FINANCIALS - (CONTINUED) COMMERCIAL BANKS - (CONTINUED) DBS Group Holdings Ltd. 377,000 3,444,282 DNB NOR ASA 386,600 3,935,465 HSBC Holdings PLC 571,500 9,540,171 Mitsubishi Tokyo Financial Group, Inc. 352 3,228,373 Mizuho Financial Group, Inc. 755 3,667,715 National Bank of Greece SA 125,190 4,758,409 Royal Bank of Scotland Group PLC 255,071 8,736,632 Skandinaviska Enskilda Banken AB, Class A 149,000 2,887,422 Sumitomo Mitsui Financial Group, Inc. 461 3,193,269 Suncorp-Metway Ltd. 111,100 1,657,074 UniCredito Italiano S.p.A. 463,600 2,706,409 United Overseas Bank Ltd. 499,000 4,166,678 ------------- Commercial Banks Total 103,758,917 CONSUMER FINANCE - 0.4% Credit Saison Co., Ltd. 77,800 2,762,641 ------------- Consumer Finance Total 2,762,641 DIVERSIFIED FINANCIAL SERVICES - 0.7% ING Groep NV, CVA 162,040 4,977,829 ------------- Diversified Financial Services Total 4,977,829 INSURANCE - 4.5% Aegon NV 458,234 6,612,787 Allianz AG, Registered Shares 21,893 2,767,998 AXA 230,780 6,197,727 Irish Life & Permanent PLC 196,100 3,986,249 Mitsui Sumitomo Insurance Co., Ltd. 322,000 2,867,378 QBE Insurance Group Ltd. 137,100 1,657,803 Riunione Adriatica di Sicurta S.p.A. 151,001 3,503,860 Zurich Financial Services AG (a) 15,983 2,940,752 ------------- Insurance Total 30,534,554 REAL ESTATE - 2.0% City Developments Ltd. 321,000 1,329,807 Sumitomo Realty & Development Co., Ltd. 287,000 3,657,762 Sun Hung Kai Properties Ltd. 287,000 2,665,042 Swire Pacific Ltd., Class A 461,000 3,757,278 Wharf Holdings Ltd. 503,000 1,705,194 ------------- Real Estate Total 13,115,083 ------------- FINANCIALS TOTAL 167,353,497 HEALTH CARE - 8.9% HEALTH CARE EQUIPMENT & SUPPLIES - 1.7% GN Store Nord A/S 158,000 1,712,520 Smith & Nephew PLC 494,310 5,071,584 Synthes, Inc. (a) 28,200 3,406,529 Terumo Corp. 50,100 1,570,385 ------------- Health Care Equipment & Supplies Total 11,761,018 SHARES VALUE ($) ------- ------------- PHARMACEUTICALS - 7.2% AstraZeneca PLC 208,600 8,272,737 GlaxoSmithKline PLC 478,450 11,471,745 Novartis AG, Registered Shares 137,760 6,911,158 Sanofi-Aventis SA 79,330 6,349,412 Schering AG 66,600 4,871,302 Shire Pharmaceuticals Group PLC 201,800 2,244,160 Takeda Pharmaceutical Co., Ltd. 85,700 4,100,923 Teva Pharmaceutical Industries Ltd., ADR 141,400 4,257,554 ------------- Pharmaceuticals Total 48,478,991 ------------- HEALTH CARE TOTAL 60,240,009 INDUSTRIALS - 12.5% AEROSPACE & DEFENSE - 0.3% Singapore Technologies Engineering Ltd. 1,350,000 1,959,223 ------------- Aerospace & Defense Total 1,959,223 BUILDING PRODUCTS - 0.9% Nippon Sheet Glass Co., Ltd. 429,000 1,903,045 Wienerberger AG 78,755 3,917,924 ------------- Building Products Total 5,820,969 COMMERCIAL SERVICES & SUPPLIES - 1.3% Randstad Holding NV 205,218 9,126,215 ------------- Commercial Services & Supplies Total 9,126,215 CONSTRUCTION & ENGINEERING - 1.8% Obayashi Corp. 319,000 2,025,361 Shimizu Corp. 586,000 2,885,581 Vinci SA 50,900 7,479,683 ------------- Construction & Engineering Total 12,390,625 ELECTRICAL EQUIPMENT - 0.5% Mitsubishi Electric Corp. 669,000 3,505,337 ------------- Electrical Equipment Total 3,505,337 INDUSTRIAL CONGLOMERATES - 1.6% Hutchison Whampoa Ltd. 380,000 3,417,213 SembCorp Industries Ltd. 1,161,000 1,351,943 Siemens AG, Registered Shares 29,778 2,336,139 Smiths Group PLC 225,978 3,702,894 ------------- Industrial Conglomerates Total 10,808,189 MACHINERY - 2.5% Atlas Copco AB, Class B 178,400 8,244,354 Komatsu Ltd. 284,000 2,133,755 Volvo AB, Class B 135,200 6,213,483 ------------- Machinery Total 16,591,592 MARINE - 0.5% Kawasaki Kisen Kaisha Ltd. 443,000 3,331,073 ------------- Marine Total 3,331,073 See Accompanying Notes to Financial Statements. | 71 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia International Stock Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - (CONTINUED) INDUSTRIALS - (CONTINUED) ROAD & RAIL - 1.8% Canadian National Railway Co. 117,385 7,279,992 ComfortDelGro Corp., Ltd. 2,285,000 2,346,808 East Japan Railway Co. 462 2,466,320 ------------- Road & Rail Total 12,093,120 TRADING COMPANIES & DISTRIBUTORS - 0.8% Mitsubishi Corp. 413,000 5,634,364 ------------- Trading Companies & Distributors Total 5,634,364 TRANSPORTATION INFRASTRUCTURE - 0.5% BAA PLC 289,700 3,384,618 ------------- Transportation Infrastructure Total 3,384,618 ------------- INDUSTRIALS TOTAL 84,645,325 INFORMATION TECHNOLOGY - 6.0% COMMUNICATIONS EQUIPMENT - 1.4% Nokia Oyj 238,000 3,846,509 Tandberg ASA 302,600 3,376,869 Telefonaktiebolaget LM Ericsson, ADR (a) 78,800 2,309,628 ------------- Communications Equipment Total 9,533,006 COMPUTERS & PERIPHERALS - 0.5% Toshiba Corp. 810,000 3,572,566 ------------- Computers & Peripherals Total 3,572,566 ELECTRONIC EQUIPMENT & INSTRUMENTS - 1.1% Hoya Corp. 16,000 1,740,796 TDK Corp. 78,000 5,663,651 ------------- Electronic Equipment & Instruments Total 7,404,447 INTERNET SOFTWARE & SERVICES - 0.2% NIWS Co., Ltd. 475 1,465,237 ------------- Internet Software & Services Total 1,465,237 OFFICE ELECTRONICS - 0.6% Canon, Inc. 78,400 4,151,606 ------------- Office Electronics Total 4,151,606 SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 1.7% Marvell Technology Group Ltd. (a) 78,500 2,872,315 Samsung Electronics Co., Ltd. 11,500 5,984,419 STMicroelectronics NV, N.Y. Registered Shares 125,100 2,225,529 ------------- Semiconductors & Semiconductor Equipment Total 11,082,263 SOFTWARE - 0.5% Sage Group PLC 888,100 3,519,733 ------------- Software Total 3,519,733 ------------- INFORMATION TECHNOLOGY TOTAL 40,728,858 SHARES VALUE ($) ------- ------------- MATERIALS - 5.5% CHEMICALS - 4.0% BASF AG 46,600 3,490,687 Novozymes A/S, Class B 33,300 1,647,734 Shin-Etsu Chemical Co., Ltd. 114,900 4,702,166 Solvay SA, Class A 15,700 1,826,956 Sumitomo Chemical Co., Ltd. 1,243,000 6,616,521 Syngenta AG (a) 60,436 6,792,662 Teijin Ltd. 563,000 2,338,937 ------------- Chemicals Total 27,415,663 CONSTRUCTION MATERIALS - 0.9% Cemex SA de CV, ADR, Certificate of Participation 149,900 5,991,503 ------------- Construction Materials Total 5,991,503 PAPER & FOREST PRODUCTS - 0.6% Stora Enso Oyj, Class R 111,100 1,692,115 UPM-Kymmene Oyj 112,100 2,502,998 ------------- Paper & Forest Products Total 4,195,113 ------------- MATERIALS TOTAL 37,602,279 TELECOMMUNICATION SERVICES - 5.2% DIVERSIFIED TELECOMMUNICATION SERVICES - 3.2% Belgacom SA (a) 90,300 3,793,815 Deutsche Telekom AG, Registered Shares (a) 219,345 4,595,628 France Telecom SA 160,300 4,842,961 Nippon Telegraph & Telephone Corp. 778 3,372,766 Royal Koninklijke KPN NV 281,410 2,723,316 Singapore Telecommunications Ltd. 1,291,000 2,081,897 ------------- Diversified Telecommunication Services Total 21,410,383 WIRELESS TELECOMMUNICATION SERVICES - 2.0% NTT DoCoMo, Inc. 1,158 1,966,527 Vodafone Group PLC 4,566,860 11,975,471 ------------- Wireless Telecommunication Services Total 13,941,998 ------------- TELECOMMUNICATION SERVICES TOTAL 35,352,381 UTILITIES - 4.4% ELECTRIC UTILITIES - 2.5% E.ON AG 39,210 3,527,344 Enel S.p.A. 551,139 5,302,635 Fortum Oyj 204,600 3,923,252 Tokyo Electric Power Co., Inc. 166,800 4,090,734 ------------- Electric Utilities Total 16,843,965 GAS UTILITIES - 0.4% Tokyo Gas Co., Ltd. 676,000 2,722,674 ------------- Gas Utilities Total 2,722,674 72 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia International Stock Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - (CONTINUED) UTILITIES - (CONTINUED) MULTI-UTILITIES & UNREGULATED POWER - 1.5% National Grid Transco PLC 487,236 4,740,872 Veolia Environnement 157,600 5,479,735 ------------- Multi-Utilities & Unregulated Power Total 10,220,607 ------------- UTILITIES TOTAL 29,787,246 Total Common Stocks (Cost of $552,685,526) 663,959,838 PREFERRED STOCK - 0.8% CONSUMER DISCRETIONARY - 0.8% AUTOMOBILES - 0.8% Porsche AG 7,300 5,274,572 ------------- Automobiles Total 5,274,572 ------------- CONSUMER DISCRETIONARY TOTAL 5,274,572 Total Preferred Stock (Cost of $4,662,184) 5,274,572 SHORT-TERM OBLIGATION - 1.2% PAR ($) Repurchase agreement with State Street Bank & Trust Co., dated 02/28/05, due 03/01/05 at 2.500%, collateralized by a U.S. Treasury Note maturing 09/30/06, market value of $8,038,881 (repurchase proceeds $7,878,547) 7,878,000 7,878,000 ------------- TOTAL SHORT-TERM OBLIGATION (COST OF $7,878,000) 7,878,000 TOTAL INVESTMENTS - 99.9% (COST OF $565,225,710) (b) 677,112,410 OTHER ASSETS & LIABILITIES, NET - 0.1% 851,823 NET ASSETS - 100.0% 677,964,233 NOTES TO INVESTMENT PORTFOLIO: (a) Non-income producing security. (b) Cost for federal income tax purposes is $565,225,710. SUMMARY OF SECURITIES % OF TOTAL BY COUNTRY VALUE INVESTMENTS ---------------------------------------------------------------------- United Kingdom $148,630,363 22.0% Japan 144,331,396 21.3 France 59,905,954 8.8 Germany 43,029,566 6.4 Netherlands 39,492,298 5.8 Switzerland 33,958,644 5.0 Italy 30,348,973 4.5 Sweden 19,654,888 2.9 United States* 17,920,671 2.6 Canada 17,879,772 2.6 Singapore 16,680,638 2.5 Ireland 14,574,072 2.2 Finland 11,964,873 1.8 Hong Kong 11,544,727 1.7 Spain 10,987,581 1.6 Norway 10,622,819 1.6 Austria 6,066,855 0.9 Mexico 5,991,503 0.9 South Korea 5,984,419 0.9 Belgium 5,620,771 0.8 Australia 5,343,446 0.8 Greece 4,758,409 0.7 Israel 4,257,554 0.6 Denmark 3,360,254 0.5 Panama 2,267,646 0.3 Luxembourg 1,934,318 0.3 ------------ ----- $677,112,410 100.0% ============ ===== * Includes short-term obligation. Certain securities are listed by country of underlying exposure but may trade predominately on other exchanges. At February 28, 2005, the Fund held investments in the following sectors: % OF SECTOR NET ASSETS ---------------------------------------------------------------------- Financials 24.7% Consumer Discretionary 12.9 Industrials 12.5 Energy 9.9 Health Care 8.9 Consumer Staples 8.7 Information Technology 6.0 Materials 5.5 Telecommunication Services 5.2 Utilities 4.4 Short-Term Obligation 1.2 Other Assets & Liabilities, Net 0.1 ----- 100.0% ===== ACRONYM NAME ------- ---- ADR American Depositary Receipt See Accompanying Notes to Financial Statements. | 73 INVESTMENT PORTFOLIO ___________________________________________________________ February 28, 2005 (Unaudited) Columbia Mid Cap Growth Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - 99.5% CONSUMER DISCRETIONARY - 20.7% AUTO COMPONENTS - 0.9% Autoliv, Inc. 153,300 7,655,802 ------------- Auto Components Total 7,655,802 HOTELS, RESTAURANTS & LEISURE - 5.1% Applebee's International, Inc. 264,640 7,544,887 Cheesecake Factory, Inc. (a) 298,620 10,162,039 Four Seasons Hotels, Inc. 28,340 2,037,079 Harrah's Entertainment, Inc. 83,970 5,507,592 Hilton Hotels Corp. 235,130 4,951,838 Marriott International, Inc., Class A 72,860 4,670,326 Yum! Brands, Inc. 198,540 9,684,781 ------------- Hotels, Restaurants & Leisure Total 44,558,542 HOUSEHOLD DURABLES - 5.0% Black & Decker Corp. 29,680 2,461,066 Centex Corp. 28,450 1,809,135 D.R. Horton, Inc. 73,610 3,221,174 Harman International Industries, Inc. 103,080 11,562,483 Tempur-Pedic International, Inc. (a) 1,245,720 23,855,538 ------------- Household Durables Total 42,909,396 LEISURE EQUIPMENT & PRODUCTS - 0.8% Marvel Enterprises, Inc. (a) 387,990 6,836,384 ------------- Leisure Equipment & Products Total 6,836,384 MEDIA - 2.3% Grupo Televisa SA, ADR 31,210 2,011,485 Lamar Advertising Co., Class A (a) 68,490 2,690,972 XM Satellite Radio Holdings, Inc., Class A (a) 476,390 15,701,814 ------------- Media Total 20,404,271 SPECIALTY RETAIL - 5.7% Abercrombie & Fitch Co., Class A 79,200 4,253,040 Bed Bath & Beyond, Inc. (a) 73,370 2,752,842 Chico's FAS, Inc. (a) 379,540 11,177,453 PETCO Animal Supplies, Inc. (a) 187,650 6,650,316 PETsMART, Inc. 294,930 8,995,365 Urban Outfitters, Inc. (a) 374,140 15,560,483 ------------- Specialty Retail Total 49,389,499 TEXTILES, APPAREL & LUXURY GOODS - 0.9% Coach, Inc. (a) 133,900 7,435,467 ------------- Textiles, Apparel & Luxury Goods Total 7,435,467 ------------- CONSUMER DISCRETIONARY TOTAL 179,189,361 CONSUMER STAPLES - 3.9% FOOD & STAPLES RETAILING - 0.8% Whole Foods Market, Inc. 65,900 6,775,838 ------------- Food & Staples Retailing Total 6,775,838 SHARES VALUE ($) ------- ------------- FOOD PRODUCTS - 2.3% Bunge Ltd. 138,610 7,583,353 Corn Products International, Inc. 326,320 9,127,171 Hershey Foods Corp. 55,730 3,510,990 ------------- Food Products Total 20,221,514 PERSONAL PRODUCTS - 0.8% Alberto-Culver Co. 64,280 3,359,916 Estee Lauder Companies, Inc., Class A 77,580 3,411,968 ------------- Personal Products Total 6,771,884 ------------- CONSUMER STAPLES TOTAL 33,769,236 ENERGY - 6.1% ENERGY EQUIPMENT & SERVICES - 3.6% BJ Services Co. 79,870 3,990,305 FMC Technologies, Inc. (a) 90,790 3,135,886 Nabors Industries Ltd. (a) 177,580 10,193,092 National-Oilwell, Inc. (a) 137,370 6,228,356 Weatherford International Ltd. (a) 121,070 7,216,983 ------------- Energy Equipment & Services Total 30,764,622 OIL & GAS - 2.5% EOG Resources, Inc. 52,910 4,821,159 Murphy Oil Corp. 42,540 4,255,702 Range Resources Corp. 96,590 2,437,932 Ultra Petroleum Corp. (a) 71,490 4,028,461 XTO Energy, Inc. 136,185 6,199,141 ------------- Oil & Gas Total 21,742,395 ------------- ENERGY TOTAL 52,507,017 FINANCIALS - 5.5% CAPITAL MARKETS - 1.7% Ameritrade Holding Corp. (a) 193,330 2,055,098 E*TRADE Financial Corp. (a) 677,720 8,993,345 T. Rowe Price Group, Inc. 60,760 3,730,056 ------------- Capital Markets Total 14,778,499 COMMERCIAL BANKS - 1.8% North Fork Bancorporation, Inc. 200,645 5,780,582 TCF Financial Corp. 112,320 3,105,648 Zions Bancorporation 98,110 6,485,071 ------------- Commercial Banks Total 15,371,301 CONSUMER FINANCE - 0.3% First Marblehead Corp. (a) 39,565 2,751,746 ------------- Consumer Finance Total 2,751,746 DIVERSIFIED FINANCIAL SERVICES - 0.2% Chicago Mercantile Exchange 9,760 2,016,611 ------------- Diversified Financial Services Total 2,016,611 74 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Mid Cap Growth Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - (CONTINUED) FINANCIALS - (CONTINUED) INSURANCE - 0.7% Ambac Financial Group, Inc. 82,610 6,425,406 ------------- Insurance Total 6,425,406 REAL ESTATE - 0.5% St. Joe Co. 55,090 4,002,288 ------------- Real Estate Total 4,002,288 THRIFTS & MORTGAGE FINANCE - 0.3% Doral Financial Corp. 54,000 2,141,640 ------------- Thrifts & Mortgage Finance Total 2,141,640 ------------- FINANCIALS TOTAL 47,487,491 HEALTH CARE - 15.9% BIOTECHNOLOGY - 2.0% Amylin Pharmaceuticals, Inc. (a) 414,860 8,886,301 Genzyme Corp. (a) 141,850 7,956,367 ------------- Biotechnology Total 16,842,668 HEALTH CARE EQUIPMENT & SUPPLIES - 7.2% Beckman Coulter, Inc. 74,730 5,264,729 Biomet, Inc. 135,710 5,729,676 Cooper Companies, Inc. 63,910 5,262,989 Fisher Scientific International, Inc. (a) 96,890 5,876,378 Gen-Probe, Inc. (a) 136,280 6,938,015 Kinetic Concepts, Inc. (a) 238,330 15,546,266 Nektar Therapeutics (a) 238,630 4,137,844 Thermo Electron Corp. (a) 288,080 7,910,677 Varian Medical Systems, Inc. (a) 161,210 5,792,275 ------------- Health Care Equipment & Supplies Total 62,458,849 HEALTH CARE PROVIDERS & SERVICES - 3.5% Accredo Health, Inc. (a) 166,560 7,098,787 Community Health Systems, Inc. (a) 143,190 4,635,060 DaVita, Inc. (a) 280,265 11,838,394 WellPoint, Inc. (a) 55,430 6,765,786 ------------- Health Care Providers & Services Total 30,338,027 PHARMACEUTICALS - 3.2% Endo Pharmaceuticals Holdings, Inc. (a) 265,350 5,978,336 Medicis Pharmaceutical Corp., Class A 418,960 14,470,878 Teva Pharmaceutical Industries Ltd., ADR 240,050 7,227,905 ------------- Pharmaceuticals Total 27,677,119 ------------- HEALTH CARE TOTAL 137,316,663 SHARES VALUE ($) ------- ------------- INDUSTRIALS - 10.9% AEROSPACE & DEFENSE - 1.2% L-3 Communications Holdings, Inc. 63,270 4,561,767 United Defense Industries, Inc. 101,290 5,542,589 ------------- Aerospace & Defense Total 10,104,356 AIR FREIGHT & LOGISTICS - 1.5% C.H. Robinson Worldwide, Inc. 174,760 9,576,848 Expeditors International of Washington, Inc. 61,930 3,437,734 ------------- Air Freight & Logistics Total 13,014,582 BUILDING PRODUCTS - 0.5% Masco Corp. 117,420 3,959,402 ------------- Building Products Total 3,959,402 COMMERCIAL SERVICES & SUPPLIES - 5.7% ChoicePoint, Inc. (a) 228,520 9,209,356 Cintas Corp. 66,300 2,902,614 Corporate Executive Board Co. 185,580 11,608,029 Education Management Corp. (a) 156,020 4,574,507 Manpower, Inc. 307,980 13,458,726 Robert Half International, Inc. 248,890 7,260,121 ------------- Commercial Services & Supplies Total 49,013,353 CONSTRUCTION & ENGINEERING - 1.0% Jacobs Engineering Group, Inc. (a) 162,960 9,122,501 ------------- Construction & Engineering Total 9,122,501 MACHINERY - 0.7% Joy Global, Inc. 73,920 2,716,560 Terex Corp. (a) 72,260 3,266,152 ------------- Machinery Total 5,982,712 ROAD & RAIL - 0.3% Landstar System, Inc. (a) 85,570 3,001,796 ------------- Road & Rail Total 3,001,796 ------------- INDUSTRIALS TOTAL 94,198,702 INFORMATION TECHNOLOGY - 25.0% COMMUNICATIONS EQUIPMENT - 3.8% Avocent Corp. (a) 111,330 3,814,166 Comverse Technology, Inc. (a) 356,550 8,275,525 Harris Corp. 125,600 8,377,520 Juniper Networks, Inc. (a) 197,170 4,247,042 Polycom, Inc. (a) 264,320 4,279,341 Tellabs, Inc. (a) 612,080 4,339,647 ------------- Communications Equipment Total 33,333,241 COMPUTERS & PERIPHERALS - 1.8% Apple Computer, Inc. (a) 219,300 9,837,798 SanDisk Corp. (a) 204,470 5,496,154 ------------- Computers & Peripherals Total 15,333,952 See Accompanying Notes to Financial Statements. | 75 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Mid Cap Growth Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - (CONTINUED) INFORMATION TECHNOLOGY - (CONTINUED) ELECTRONIC EQUIPMENT & INSTRUMENTS - 0.6% Dolby Laboratories, Inc., Class A (a) 66,800 1,541,744 FLIR Systems, Inc. (a) 126,930 3,966,563 ------------- Electronic Equipment & Instruments Total 5,508,307 INTERNET SOFTWARE & SERVICES - 0.9% Ask Jeeves, Inc. (a) 156,200 3,570,732 VeriSign, Inc. (a) 139,970 3,837,977 ------------- Internet Software & Services Total 7,408,709 IT SERVICES - 2.2% Cognizant Technology Solutions Corp., Class A (a) 232,710 10,990,893 Iron Mountain, Inc. (a) 193,240 5,227,142 SunGard Data Systems, Inc. (a) 103,470 2,701,602 ------------- IT Services Total 18,919,637 OFFICE ELECTRONICS - 0.5% Zebra Technologies Corp., Class A (a) 90,680 4,522,212 ------------- Office Electronics Total 4,522,212 SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 8.6% Advanced Micro Devices (a) 566,880 9,892,056 Altera Corp. (a) 155,630 3,227,766 Broadcom Corp., Class A (a) 325,090 10,484,152 Linear Technology Corp. 205,220 8,015,893 Marvell Technology Group Ltd. (a) 409,110 14,969,335 Microchip Technology, Inc. 176,680 4,851,633 National Semiconductor Corp. 176,810 3,527,360 NVIDIA Corp. (a) 305,260 8,849,487 Silicon Laboratories, Inc. (a) 297,050 10,426,455 ------------- Semiconductors & Semiconductor Equipment Total 74,244,137 SOFTWARE - 6.6% Amdocs Ltd. (a) 222,470 6,529,495 BMC Software, Inc. (a) 234,040 3,498,898 Business Objects SA, ADR (a) 111,450 3,116,142 Check Point Software Technologies Ltd. (a) 345,880 7,654,324 Citrix Systems, Inc. (a) 368,840 8,298,900 Hyperion Solutions Corp. (a) 134,580 6,793,598 Mercury Interactive Corp. (a) 232,570 10,670,312 Shanda Interactive Entertainment Ltd., ADS (a) 151,700 4,585,891 VERITAS Software Corp. (a) 249,770 6,049,429 ------------- Software Total 57,196,989 ------------- INFORMATION TECHNOLOGY TOTAL 216,467,184 SHARES VALUE ($) ------- ------------- MATERIALS - 7.0% CHEMICALS - 2.1% Potash Corp. of Saskatchewan, Inc. 208,920 18,556,274 ------------- Chemicals Total 18,556,274 CONSTRUCTION MATERIALS - 0.3% Florida Rock Industries, Inc. 36,600 2,348,622 ------------- Construction Materials Total 2,348,622 METALS & MINING - 4.6% Allegheny Technologies, Inc. 113,730 2,798,895 CONSOL Energy, Inc. 54,130 2,481,319 Freeport-McMoRan Copper & Gold, Inc., Class B 129,100 5,398,962 Inco Ltd. (a) 309,060 12,825,990 Peabody Energy Corp. 81,940 7,956,374 Phelps Dodge Corp. 81,290 8,653,321 ------------- Metals & Mining Total 40,114,861 ------------- MATERIALS TOTAL 61,019,757 TELECOMMUNICATION SERVICES - 4.3% WIRELESS TELECOMMUNICATION SERVICES - 4.3% American Tower Corp., Class A (a) 165,240 3,028,849 Crown Castle International Corp. (a) 526,600 8,604,644 Millicom International Cellular SA (a) 222,360 4,987,535 Mobile TeleSystems, ADR 183,310 7,348,898 Nextel Partners, Inc., Class A (a) 213,330 4,247,400 SpectraSite, Inc. (a) 40,560 2,506,608 VimpelCom, ADR (a) 90,070 3,611,807 Western Wireless Corp., Class A (a) 69,460 2,729,778 ------------- Wireless Telecommunication Services Total 37,065,519 ------------- TELECOMMUNICATION SERVICES TOTAL 37,065,519 UTILITIES - 0.2% MULTI-UTILITIES & UNREGULATED POWER - 0.2% AES Corp. (a) 124,570 2,085,302 ------------- Multi-Utilities & Unregulated Power Total 2,085,302 ------------- UTILITIES TOTAL 2,085,302 Total Common Stocks (Cost of $736,575,108) 861,106,232 CONVERTIBLE PREFERRED STOCK - 0.0% INFORMATION TECHNOLOGY - 0.0% INTERNET SOFTWARE & SERVICES - 0.0% Network Specialists, Inc., Series A (a)(b)(c) 394,218 3,942 ------------- Internet Software & Services Total 3,942 ------------- INFORMATION TECHNOLOGY TOTAL 3,942 Total Convertible Preferred Stock (Cost of $3,000,000) 3,942 76 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Mid Cap Growth Fund PAR ($) VALUE ($) ------- ------------- SHORT-TERM OBLIGATION - 0.3% Repurchase agreement with State Street Bank & Trust Co., dated 02/28/05, due 03/01/05 at 2.500%, collateralized by a U.S. Treasury Note maturing 09/30/06, market value of $2,364,377 (repurchase proceeds $2,316,161) 2,316,000 2,316,000 ------------- Total Short-Term Obligation (Cost of $2,316,000) 2,316,000 TOTAL INVESTMENTS - 99.8% (COST OF $741,891,108) (D) 863,426,174 OTHER ASSETS & LIABILITIES, NET - 0.2% 1,478,105 NET ASSETS - 100.0% 864,904,279 NOTES TO INVESTMENT PORTFOLIO: (a) Non-income producing security. (b) Represents fair value as determined in good faith under procedures approved by the Board of Directors. (c) Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933. This security may be resold in transactions exempt from registration, normally to qualified institutional buyers. At February 28, 2005, the value of this security represents less than 0.1% of net assets. (d) Cost for federal income tax purposes is $741,891,108. At February 28, 2005, the Fund held investments in the following sectors: % OF SECTOR NET ASSETS ---------------------------------------------------------------- Information Technology 25.0% Consumer Discretionary 20.7 Health Care 15.9 Industrials 10.9 Materials 7.0 Energy 6.1 Financials 5.5 Telecommunication Services 4.3 Consumer Staples 3.9 Utilities 0.2 Short-Term Obligation 0.3 Other Assets & Liabilities, Net 0.2 ----- 100.0% ===== ACRONYM NAME ------- ---- ADR American Depositary Receipt ADS American Depositary Share See Accompanying Notes to Financial Statements. | 77 INVESTMENT PORTFOLIO ___________________________________________________________ February 28, 2005 (Unaudited) Columbia Small Cap Growth Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - 99.8% CONSUMER DISCRETIONARY - 12.7% AUTO COMPONENTS - 0.5% Autoliv, Inc. 25,761 1,286,504 ------------- Auto Components Total 1,286,504 HOTELS, RESTAURANTS & LEISURE - 5.7% Applebee's International, Inc. 53,510 1,525,570 Buffalo Wild Wings, Inc. (a) 41,150 1,551,355 CBRL Group, Inc. 24,349 1,042,381 Cheesecake Factory, Inc. (a) 40,030 1,362,221 P.F. Chang's China Bistro, Inc. (a) 37,650 2,063,596 Panera Bread Co., Class A (a) 20,460 1,093,792 RARE Hospitality International, Inc. (a) 82,090 2,401,953 Scientific Games Corp., Class A (a) 122,450 3,149,414 WMS Industries, Inc. (a) 22,050 661,280 ------------- Hotels, Restaurants & Leisure Total 14,851,562 HOUSEHOLD DURABLES - 2.6% Tempur-Pedic International, Inc. (a) 350,140 6,705,181 ------------- Household Durables Total 6,705,181 INTERNET & CATALOG RETAIL - 0.5% Blue Nile, Inc. (a) 51,190 1,437,927 ------------- Internet & Catalog Retail Total 1,437,927 LEISURE EQUIPMENT & PRODUCTS - 0.3% Marvel Enterprises, Inc. (a) 43,530 766,999 ------------- Leisure Equipment & Products Total 766,999 MEDIA - 1.1% Getty Images, Inc. (a) 41,942 2,992,142 ------------- Media Total 2,992,142 SPECIALTY RETAIL - 1.5% PETCO Animal Supplies, Inc. (a) 76,702 2,718,319 Too, Inc. (a) 49,490 1,314,454 ------------- Specialty Retail Total 4,032,773 TEXTILES, APPAREL & LUXURY GOODS - 0.5% Quiksilver, Inc. (a) 40,650 1,284,134 ------------- Textiles, Apparel & Luxury Goods Total 1,284,134 ------------- CONSUMER DISCRETIONARY TOTAL 33,357,222 CONSUMER STAPLES - 1.3% FOOD PRODUCTS - 1.3% Bunge Ltd. 29,782 1,629,373 Corn Products International, Inc. 60,070 1,680,158 ------------- Food Products Total 3,309,531 ------------- CONSUMER STAPLES TOTAL 3,309,531 SHARES VALUE ($) ------- ------------- ENERGY - 7.8% ENERGY EQUIPMENT & SERVICES - 4.2% Atwood Oceanics, Inc. (a) 35,690 2,453,687 CAL Dive International, Inc. (a) 27,324 1,387,513 Grey Wolf, Inc. (a) 224,740 1,458,563 Key Energy Services, Inc. (a) 190,999 2,639,606 National-Oilwell, Inc. (a) 68,520 3,106,697 ------------- Energy Equipment & Services Total 11,046,066 OIL & GAS - 3.6% Cheniere Energy, Inc. (a) 33,020 2,456,688 KFx, Inc. (a) 66,980 1,138,660 Quicksilver Resources, Inc. (a) 18,630 927,402 Range Resources Corp. 52,550 1,326,362 Toreador Resources Corp. (a) 42,810 1,041,139 Warren Resources, Inc. (a) 95,280 1,124,304 XTO Energy, Inc. 30,460 1,386,539 ------------- Oil & Gas Total 9,401,094 ------------- ENERGY TOTAL 20,447,160 FINANCIALS - 5.9% CAPITAL MARKETS - 1.8% Affiliated Managers Group, Inc. (a) 61,401 3,976,329 optionsXpress Holdings, Inc. (a) 41,160 710,010 ------------- Capital Markets Total 4,686,339 COMMERCIAL BANKS - 0.9% MB Financial, Inc. 20,942 850,455 Umpqua Holdings Corp. 67,801 1,621,122 ------------- Commercial Banks Total 2,471,577 INSURANCE - 1.3% Allmerica Financial Corp. (a) 27,690 991,302 ProAssurance Corp. (a) 58,447 2,367,103 ------------- Insurance Total 3,358,405 THRIFTS & MORTGAGE FINANCE - 1.9% Commercial Capital Bancorp, Inc. 167,750 3,623,400 Sterling Financial Corp. (a) 32,562 1,241,263 ------------- Thrifts & Mortgage Finance Total 4,864,663 ------------- FINANCIALS TOTAL 15,380,984 HEALTH CARE - 21.0% BIOTECHNOLOGY - 4.7% Alexion Pharmaceuticals, Inc. (a) 53,090 1,239,651 Alkermes, Inc. (a) 56,340 658,051 Cubist Pharmaceuticals, Inc. (a) 178,070 1,834,121 CV Therapeutics, Inc. (a) 40,190 881,367 Digene Corp. (a) 91,260 2,192,978 Nabi Biopharmaceuticals (a) 139,780 1,775,206 Onyx Pharmaceuticals, Inc. (a) 19,105 552,899 Rigel Pharmaceuticals, Inc. (a) 89,380 1,666,043 United Therapeutics Corp. (a) 34,470 1,565,972 ------------- Biotechnology Total 12,366,288 78 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Small Cap Growth Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - (CONTINUED) HEALTH CARE - (CONTINUED) HEALTH CARE EQUIPMENT & SUPPLIES - 3.6% Advanced Neuromodulation Systems, Inc. (a) 24,760 730,420 ArthroCare Corp. (a) 63,752 1,837,333 Kyphon, Inc. (a) 69,300 1,703,394 Nektar Therapeutics (a) 81,800 1,418,412 ResMed, Inc. (a) 62,458 3,681,899 ------------- Health Care Equipment & Supplies Total 9,371,458 HEALTH CARE PROVIDERS & SERVICES - 9.6% Accredo Health, Inc. (a) 21,680 924,001 Cerner Corp. (a) 34,298 1,786,926 Chemed Corp. 23,680 1,690,752 DaVita, Inc. (a) 95,620 4,038,989 HealthExtras, Inc. (a) 203,822 3,308,031 ICON PLC, ADR (a) 98,523 3,523,182 IDX Systems Corp. (a) 62,586 2,147,326 Renal Care Group, Inc. (a) 137,231 5,406,901 United Surgical Partners International, Inc. (a) 56,132 2,304,780 ------------- Health Care Providers & Services Total 25,130,888 PHARMACEUTICALS - 3.1% Connetics Corp. (a) 66,670 1,650,083 MGI Pharma, Inc. (a) 80,735 1,848,831 Salix Pharmaceuticals Ltd. (a) 286,208 4,645,156 ------------- Pharmaceuticals Total 8,144,070 ------------- HEALTH CARE TOTAL 55,012,704 INDUSTRIALS - 16.1% AEROSPACE & DEFENSE - 3.2% BE Aerospace, Inc. (a) 165,990 1,996,860 Engineered Support Systems, Inc. 14,680 811,510 United Defense Industries, Inc. 103,491 5,663,028 ------------- Aerospace & Defense Total 8,471,398 AIR FREIGHT & LOGISTICS - 0.5% UTI Worldwide, Inc. 16,032 1,188,933 ------------- Air Freight & Logistics Total 1,188,933 COMMERCIAL SERVICES & SUPPLIES - 3.6% Corporate Executive Board Co. 58,906 3,684,570 Education Management Corp. (a) 66,834 1,959,573 Huron Consulting Group, Inc. (a) 47,690 1,073,979 Resources Connection, Inc. (a) 56,268 2,799,896 ------------- Commercial Services & Supplies Total 9,518,018 CONSTRUCTION & ENGINEERING - 1.9% Dycom Industries, Inc. (a) 68,730 1,852,273 URS Corp. (a) 106,495 3,071,316 ------------- Construction & Engineering Total 4,923,589 SHARES VALUE ($) ------- ------------- ELECTRICAL EQUIPMENT - 0.5% Roper Industries, Inc. 19,700 1,272,620 ------------- Electrical Equipment Total 1,272,620 MACHINERY - 5.7% IDEX Corp. 56,910 2,247,945 Joy Global, Inc. 85,163 3,129,740 Kennametal, Inc. 59,608 2,925,561 Terex Corp. (a) 68,704 3,105,421 Wabtec Corp. 196,430 3,616,276 ------------- Machinery Total 15,024,943 MARINE - 0.7% Dryships, Inc. (a) 77,520 1,732,572 ------------- Marine Total 1,732,572 ------------- INDUSTRIALS TOTAL 42,132,073 INFORMATION TECHNOLOGY - 29.3% COMMUNICATIONS EQUIPMENT - 6.7% Alvarion Ltd. (a) 115,440 1,165,944 Avocent Corp. (a) 31,010 1,062,403 Carrier Access Corp. (a) 148,810 1,035,718 F5 Networks, Inc. (a) 60,895 3,354,705 Ixia (a) 158,012 2,845,796 Packeteer, Inc. (a) 208,690 3,301,476 Polycom, Inc. (a) 74,071 1,199,209 SiRF Technology Holdings, Inc. (a) 306,200 3,441,688 ------------- Communications Equipment Total 17,406,939 COMPUTERS & PERIPHERALS - 1.6% Stratasys, Inc. (a) 81,020 2,346,339 Synaptics, Inc. (a) 71,290 1,703,118 ------------- Computers & Peripherals Total 4,049,457 ELECTRONIC EQUIPMENT & INSTRUMENTS - 1.3% Benchmark Electronics, Inc. (a) 42,340 1,376,897 Dolby Laboratories, Inc., Class A (a) 19,250 444,290 Trimble Navigation Ltd. (a) 45,900 1,653,318 ------------- Electronic Equipment & Instruments Total 3,474,505 INTERNET SOFTWARE & SERVICES - 3.2% Ask Jeeves, Inc. (a) 115,998 2,651,715 Digital River, Inc. (a) 37,640 1,134,093 Equinix, Inc. (a) 59,590 2,609,446 Imergent, Inc. (a) 39,500 638,320 Infocrossing, Inc. (a) 31,500 590,940 WebEx Communications, Inc. (a) 34,060 795,982 ------------- Internet Software & Services Total 8,420,496 See Accompanying Notes to Financial Statements. | 79 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Small Cap Growth Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - (CONTINUED) INFORMATION TECHNOLOGY - (CONTINUED) IT SERVICES - 4.6% Anteon International Corp. (a) 76,030 2,886,099 CACI International, Inc., Class A (a) 65,870 3,554,345 Cognizant Technology Solutions Corp., Class A (a) 34,156 1,613,188 Euronet Worldwide, Inc. (a) 62,330 1,614,970 Global Payments, Inc. 44,046 2,445,434 ------------- IT Services Total 12,114,036 SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 4.3% ATMI, Inc. (a) 45,370 1,234,971 Cambridge Display Technology, Inc. (a) 84,060 668,277 Microsemi Corp. (a) 99,310 1,614,781 Microtune, Inc. (a) 283,515 1,389,224 Sigmatel, Inc. (a) 28,500 1,188,165 Silicon Laboratories, Inc. (a) 112,741 3,957,209 Volterra Semiconductor Corp. (a) 77,920 1,145,424 ------------- Semiconductors & Semiconductor Equipment Total 11,198,051 SOFTWARE - 7.6% Agile Software Corp. (a) 172,040 1,180,194 Altiris, Inc. (a) 75,298 2,200,961 Citrix Systems, Inc. (a) 74,674 1,680,165 Embarcadero Technologies, Inc. (a) 364,294 2,458,984 Epicor Software Corp. (a) 166,260 2,573,705 Hyperion Solutions Corp. (a) 25,771 1,300,920 Macromedia, Inc. (a) 91,120 3,088,057 Parametric Technology Corp. (a) 386,330 2,221,398 Quest Software, Inc. (a) 68,840 934,159 SERENA Software, Inc. (a) 33,270 768,537 The9 Ltd., ADR (a) 88,220 1,598,546 ------------- Software Total 20,005,626 ------------- INFORMATION TECHNOLOGY TOTAL 76,669,110 MATERIALS - 3.4% CHEMICALS - 2.1% Airgas, Inc. 80,924 2,031,192 OM Group, Inc. (a) 106,512 3,395,603 ------------- Chemicals Total 5,426,795 METALS & MINING - 1.3% Allegheny Technologies, Inc. 48,942 1,204,462 Alpha Natural Resources, Inc. (a) 23,440 609,440 Arch Coal, Inc. 37,857 1,688,044 ------------- Metals & Mining Total 3,501,946 ------------- MATERIALS TOTAL 8,928,741 TELECOMMUNICATION SERVICES - 2.3% DIVERSIFIED TELECOMMUNICATION SERVICES - 0.5% Premiere Global Services, Inc. (a) 142,850 1,454,213 ------------- Diversified Telecommunication Services Total 1,454,213 SHARES VALUE ($) ------- ------------- WIRELESS TELECOMMUNICATION SERVICES - 1.8% Leap Wireless International, Inc. (a) 34,370 921,116 Millicom International Cellular SA (a) 97,364 2,183,874 SBA Communications Corp., Class A (a) 178,757 1,555,186 ------------- Wireless Telecommunication Services Total 4,660,176 ------------- TELECOMMUNICATION SERVICES TOTAL 6,114,389 Total Common Stocks (Cost of $237,835,973) 261,351,914 SHORT-TERM OBLIGATION - 4.5% PAR ($) Repurchase agreement with State Street Bank & Trust Co., dated 02/28/05, due 03/01/05 at 2.500%, collateralized by a U.S. Treasury Note maturing 09/30/06, market value of $12,190,228 (repurchase proceeds $11,948,830) 11,948,000 11,948,000 ------------- Total Short-Term Obligation (Cost of $11,948,000) 11,948,000 TOTAL INVESTMENTS - 104.3% (COST OF $249,783,973) (b) 273,299,914 OTHER ASSETS & LIABILITIES, NET - (4.3)% (11,372,601) NET ASSETS - 100.0% 261,927,313 NOTES TO INVESTMENT PORTFOLIO: (a) Non-income producing security. (b) Cost for federal income tax purposes is $249,783,973. At February 28, 2005, the Fund held investments in the following sectors: % OF SECTOR NET ASSETS ---------------------------------------------------------------- Information Technology 29.3% Health Care 21.0 Industrials 16.1 Consumer Discretionary 12.7 Energy 7.8 Financials 5.9 Materials 3.4 Telecommunication Services 2.3 Consumer Staples 1.3 Short-Term Obligation 4.5 Other Assets & Liabilities, Net (4.3) ----- 100.0% ===== ACRONYM NAME ------- ---- ADR American Depositary Receipt 80 | See Accompanying Notes to Financial Statements. INVESTMENT PORTFOLIO ___________________________________________________________ February 28, 2005 (Unaudited) Columbia Real Estate Equity Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - 95.1% CONSUMER DISCRETIONARY - 16.0% HOTELS, RESTAURANTS & LEISURE - 15.4% Great Wolf Resorts, Inc. (a) 296,200 7,360,570 Hilton Hotels Corp. 2,321,900 48,899,214 La Quinta Corp. (a) 1,230,000 11,377,500 Marriott International, Inc., Class A 485,300 31,107,730 Starwood Hotels & Resorts Worldwide, Inc. 625,900 35,826,516 ------------- Hotels, Restaurants & Leisure Total 134,571,530 MULTILINE RETAIL - 0.6% Sears, Roebuck & Co. 103,400 5,162,762 ------------- Multiline Retail Total 5,162,762 ------------- CONSUMER DISCRETIONARY TOTAL 139,734,292 FINANCIALS - 74.1% REAL ESTATE - 74.1% Alexandria Real Estate Equities, Inc., REIT 570,400 38,205,392 Archstone-Smith Trust, REIT 517,971 17,522,959 AvalonBay Communities, Inc., REIT 266,400 18,514,800 Boston Properties, Inc., REIT 227,400 13,598,520 Brookfield Properties Corp. 412,600 16,289,448 CenterPoint Properties Trust, REIT 461,800 20,208,368 Corporate Office Properties Trust, REIT 371,180 9,817,711 Cousins Properties, Inc., REIT 1,108,050 30,061,396 Duke Realty Corp., REIT 478,800 15,168,384 Equity Office Properties Trust, REIT 891,737 26,903,705 Equity Residential, REIT 1,081,106 35,471,088 Essex Property Trust, Inc., REIT 99,600 7,179,168 General Growth Properties, Inc., REIT 963,080 33,611,492 Highwoods Properties, Inc., REIT 340,900 8,791,811 Home Properties, Inc., REIT 109,800 4,439,214 Host Marriott Corp., REIT 1,965,300 31,405,494 iStar Financial, Inc., REIT 1,117,250 47,471,952 Kimco Realty Corp., REIT 503,500 26,740,885 Liberty Property Trust, REIT 483,400 20,041,764 Newcastle Investment Corp., REIT 312,900 9,649,836 Pan Pacific Retail Properties, Inc., REIT 299,900 17,439,185 ProLogis Trust, REIT 680,906 27,072,823 Public Storage, Inc., REIT 584,532 31,892,066 Regency Centers Corp., REIT 652,000 33,252,000 Simon Property Group, Inc., REIT 785,256 48,654,462 SL Green Realty Corp., REIT 259,000 14,602,420 St. Joe Co. 184,400 13,396,660 United Dominion Realty Trust, Inc., REIT 502,800 11,111,880 Vornado Realty Trust, REIT 274,000 18,823,800 ------------- Real Estate Total 647,338,683 ------------- FINANCIALS TOTAL 647,338,683 SHARES VALUE ($) ------- ------------- MATERIALS - 5.0% PAPER & FOREST PRODUCTS - 5.0% Bowater, Inc. 639,300 24,824,019 International Paper Co. 245,100 9,154,485 MeadWestvaco Corp. 310,100 9,724,736 ------------- Paper & Forest Products Total 43,703,240 ------------- MATERIALS TOTAL 43,703,240 Total Common Stocks (Cost of $513,843,484) 830,776,215 INCOME DEPOSIT SECURITIES - 2.6% CONSUMER DISCRETIONARY - 1.0% HOTELS, RESTAURANTS & LEISURE - 1.0% Centerplate, Inc. 665,500 8,664,810 ------------- Hotels, Restaurants & Leisure Total 8,664,810 ------------- CONSUMER DISCRETIONARY TOTAL 8,664,810 CONSUMER STAPLES - 1.1% FOOD & STAPLES RETAILING - 1.1% B&G Foods, Inc. 628,600 9,366,140 ------------- Food & Staples Retailing Total 9,366,140 ------------- CONSUMER STAPLES TOTAL 9,366,140 TELECOMMUNICATION SERVICES - 0.5% DIVERSIFIED TELECOMMUNICATION SERVICES - 0.5% Otelco, Inc. 302,000 4,671,940 ------------- Diversified Telecommunication Services Total 4,671,940 ------------- TELECOMMUNICATION SERVICES TOTAL 4,671,940 Total Income Deposit Securities (Cost of $24,015,605) 22,702,890 See Accompanying Notes to Financial Statements. | 81 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Real Estate Equity Fund PAR ($) VALUE ($) ------- ------------- SHORT-TERM OBLIGATION - 2.1% Repurchase agreement with State Street Bank & Trust Co., dated 02/28/05, due 03/01/05 at 2.500%, collateralized by a U.S. Treasury Note maturing 09/30/06, market value of $19,343,090 (repurchase proceeds $18,964,317) 18,963,000 18,963,000 ------------- Total Short-Term Obligation (Cost of $18,963,000) 18,963,000 TOTAL INVESTMENTS - 99.8% (COST OF $556,822,089) (b) 872,442,105 OTHER ASSETS & LIABILITIES, NET - 0.2% 1,360,619 NET ASSETS - 100.0% 873,802,724 NOTES TO INVESTMENT PORTFOLIO: (a) Non-income producing security. (b) Cost for federal income tax purposes is $556,822,089. At February 28, 2005, the Fund held investments in the following sectors: % OF SECTOR NET ASSETS ---------------------------------------------------------------- Financials 74.1% Consumer Discretionary 17.0 Materials 5.0 Consumer Staples 1.1 Telecommunication Services 0.5 Short-Term Obligation 2.1 Other Assets & Liabilities, Net 0.2 ----- 100.0% ===== ACRONYM NAME ------- ---- REIT Real Estate Investment Trust 82 | See Accompanying Notes to Financial Statements. INVESTMENT PORTFOLIO _________________________________________________ February 28, 2005 (Unaudited) Columbia Technology Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - 100.5% CONSUMER DISCRETIONARY - 12.7% HOTELS, RESTAURANTS & LEISURE - 0.5% Sportingbet PLC (a) 36,710 231,150 ------------- Hotels, Restaurants & Leisure Total 231,150 HOUSEHOLD DURABLES - 1.7% Harman International Industries, Inc. 6,400 717,888 ------------- Household Durables Total 717,888 INTERNET & CATALOG RETAIL - 3.9% Blue Nile, Inc. (a) 14,875 417,839 eBay, Inc. (a) 30,000 1,285,200 ------------- Internet & Catalog Retail Total 1,703,039 LEISURE EQUIPMENT & PRODUCTS - 0.8% Marvel Enterprises, Inc. (a) 20,000 352,400 ------------- Leisure Equipment & Products Total 352,400 MEDIA - 5.8% Dolby Laboratories, Inc., Class A (a) 3,500 80,780 Lions Gate Entertainment Corp. (a) 100,000 1,062,000 Lodgenet Entertainment Corp. (a) 7,400 130,610 XM Satellite Radio Holdings, Inc., Class A (a) 38,150 1,257,424 ------------- Media Total 2,530,814 ------------- CONSUMER DISCRETIONARY TOTAL 5,535,291 CONSUMER STAPLES - 0.8% FOOD & STAPLES RETAILING - 0.8% Provide Commerce, Inc. (a) 12,000 344,100 ------------- Food & Staples Retailing Total 344,100 ------------- CONSUMER STAPLES TOTAL 344,100 HEALTH CARE - 3.1% BIOTECHNOLOGY - 1.2% Amylin Pharmaceuticals, Inc. (a) 12,000 257,040 Cubist Pharmaceuticals, Inc. (a) 20,000 206,000 Rigel Pharmaceuticals, Inc. (a) 2,500 46,600 ------------- Biotechnology Total 509,640 HEALTH CARE PROVIDERS & SERVICES - 0.9% Adeza Biomedical Corp. (a) 30,300 409,050 ------------- Health Care Providers & Services Total 409,050 PHARMACEUTICALS - 1.0% Salix Pharmaceuticals Ltd. (a) 26,100 423,603 ------------- Pharmaceuticals Total 423,603 ------------- HEALTH CARE TOTAL 1,342,293 SHARES VALUE ($) ------- ------------- INDUSTRIALS - 1.1% COMMERCIAL SERVICES & SUPPLIES - 1.1% Huron Consulting Group, Inc. (a) 4,500 101,340 SOURCECORP, Inc. (a) 17,300 361,224 ------------- Commercial Services & Supplies Total 462,564 ------------- INDUSTRIALS TOTAL 462,564 INFORMATION TECHNOLOGY - 67.8% COMMUNICATIONS EQUIPMENT - 14.1% Alvarion Ltd. (a) 33,400 337,340 Avaya, Inc. (a) 28,500 399,000 Carrier Access Corp. (a) 18,250 127,020 Comverse Technology, Inc. (a) 23,000 533,830 Harris Corp. 13,550 903,785 Nokia Oyj, ADR 131,000 2,114,340 SiRF Technology Holdings, Inc. (a) 126,800 1,425,232 ViaSat, Inc. (a) 16,000 318,080 ------------- Communications Equipment Total 6,158,627 COMPUTERS & PERIPHERALS - 5.0% Apple Computer, Inc. (a) 19,000 852,340 Dell, Inc. (a) 12,500 501,125 Lexmark International, Inc., Class A (a) 3,000 240,390 Network Appliance, Inc. (a) 6,000 180,060 SanDisk Corp. (a) 15,500 416,640 ------------- Computers & Peripherals Total 2,190,555 ELECTRONIC EQUIPMENT & INSTRUMENTS - 1.7% Symbol Technologies, Inc. 20,000 354,600 Trimble Navigation Ltd. (a) 10,400 374,608 ------------- Electronic Equipment & Instruments Total 729,208 INTERNET SOFTWARE & SERVICES - 5.7% Ask Jeeves, Inc. (a) 14,900 340,614 Digital River, Inc. (a) 5,000 150,650 Google, Inc. (a) 2,500 469,975 VeriSign, Inc. (a) 34,000 932,280 Yahoo!, Inc. (a) 18,600 600,222 ------------- Internet Software & Services Total 2,493,741 IT SERVICES - 3.7% Cognizant Technology Solutions Corp., Class A (a) 13,260 626,270 Computer Sciences Corp. (a) 5,000 231,150 DST Systems, Inc. (a) 8,000 379,920 Global Payments, Inc. 7,000 388,640 ------------- IT Services Total 1,625,980 OFFICE ELECTRONICS - 0.8% Zebra Technologies Corp., Class A (a) 6,625 330,389 ------------- Office Electronics Total 330,389 See Accompanying Notes to Financial Statements. | 83 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Technology Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - (CONTINUED) INFORMATION TECHNOLOGY - (CONTINUED) SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 21.2% Advanced Micro Devices (a) 15,000 261,750 Analog Devices, Inc. 8,000 293,760 Applied Materials, Inc. (a) 25,000 437,500 Broadcom Corp., Class A (a) 20,275 653,869 Cambridge Display Technology, Inc. (a) 13,000 103,350 FormFactor, Inc. (a) 14,300 328,471 Lam Research Corp. (a) 4,800 150,912 Marvell Technology Group Ltd. (a) 39,300 1,437,987 Maxim Integrated Products, Inc. 3,500 150,570 Microtune, Inc. (a) 152,640 747,936 National Semiconductor Corp. 15,000 299,250 NVIDIA Corp. (a) 47,000 1,362,530 Samsung Electronics Co., Ltd., GDR (b) 2,700 699,300 Sigmatel, Inc. (a) 24,800 1,033,912 Silicon Laboratories, Inc. (a) 23,500 824,850 Tessera Technologies, Inc. (a) 5,000 203,700 Virage Logic Corp. (a) 19,000 251,370 ------------- Semiconductors & Semiconductor Equipment Total 9,241,017 SOFTWARE - 15.6% Agile Software Corp. (a) 40,000 274,400 Amdocs Ltd. (a) 18,000 528,300 Business Objects SA, ADR (a) 10,000 279,600 Cadence Design Systems, Inc. (a) 24,000 330,720 Check Point Software Technologies Ltd. (a) 12,000 265,560 Citrix Systems, Inc. (a) 20,000 450,000 Computer Associates International, Inc. 14,000 379,260 Epicor Software Corp. (a) 16,000 247,680 Macromedia, Inc. (a) 12,000 406,680 McAfee, Inc. (a) 18,000 416,340 Mercury Interactive Corp. (a) 14,000 642,320 Oracle Corp. (a) 30,000 387,300 Parametric Technology Corp. (a) 30,000 172,500 SAP AG, ADR 5,000 202,750 Shanda Interactive Entertainment Ltd., ADS (a) 18,750 566,812 SPSS, Inc. (a) 9,500 184,300 Symantec Corp. (a) 20,000 440,200 The9 Ltd., ADR (a) 21,100 382,332 VERITAS Software Corp. (a) 10,000 242,200 ------------- Software Total 6,799,254 ------------- INFORMATION TECHNOLOGY TOTAL 29,568,771 TELECOMMUNICATION SERVICES - 15.0% DIVERSIFIED TELECOMMUNICATION SERVICES - 0.9% Mahanagar Telephone Nigam Ltd., ADR 30,900 211,047 Maroc Telecom (a) 15,000 153,761 ------------- Diversified Telecommunication Services Total 364,808 SHARES VALUE ($) ------- ------------- WIRELESS TELECOMMUNICATION SERVICES - 14.1% American Tower Corp., Class A (a) 47,600 872,508 China Unicom Ltd., ADR 30,000 266,700 Comtech Group, Inc. (a) 18,300 126,270 Crown Castle International Corp. (a) 55,000 898,700 JAMDAT Mobile, Inc. (a) 12,500 212,500 Leap Wireless International, Inc. (a) 7,500 201,000 Millicom International Cellular SA (a) 21,700 486,731 Mobile TeleSystems, ADR 22,000 881,980 NII Holdings, Inc. (a) 9,000 514,980 SBA Communications Corp., Class A (a) 77,500 674,250 SpectraSite, Inc. (a) 5,150 318,270 VimpelCom, ADR (a) 17,500 701,750 ------------- Wireless Telecommunication Services Total 6,155,639 ------------- TELECOMMUNICATION SERVICES TOTAL 6,520,447 Total Common Stocks (Cost of $38,463,151) 43,773,466 SHORT-TERM OBLIGATION - 2.7% PAR ($) Repurchase agreement with State Street Bank & Trust Co., dated 02/28/05, due 03/01/05 at 2.500%, collateralized by a U.S. Treasury Note maturing 09/30/06, market value of $1,219,521 (repurchase proceeds $1,191,083) 1,191,000 1,191,000 ------------- Total Short-Term Obligation (Cost of $1,191,000) 1,191,000 TOTAL INVESTMENTS - 103.2% (COST OF $39,654,151) (c) 44,964,466 OTHER ASSETS & LIABILITIES, NET - (3.2)% (1,381,571) NET ASSETS - 100.0% 43,582,895 84 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Technology Fund NOTES TO INVESTMENT PORTFOLIO: (a) Non-income producing security. (b) Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933. This security may be resold in transactions exempt from registration, normally to qualified institutional buyers. At February 28, 2005, the value of this security represents 1.6% of net assets. (c) Cost for federal income tax purposes is $39,654,151. At February 28, 2005, the Fund held investments in the following sectors: % OF SECTOR NET ASSETS ---------------------------------------------------------------- Information Technology 67.8% Telecommunication Services 15.0 Consumer Discretionary 12.7 Health Care 3.1 Industrials 1.1 Consumer Staples 0.8 Short-Term Obligation 2.7 Other Assets & Liabilities, Net (3.2) ----- 100.0% ===== ACRONYM NAME ------- ---- ADR American Depositary Receipt ADS American Depositary Shares GDR Global Depositary Receipt See Accompanying Notes to Financial Statements. | 85 INVESTMENT PORTFOLIO ___________________________________________________________ February 28, 2005 (Unaudited) Columbia Strategic Investor Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - 74.5% CONSUMER DISCRETIONARY - 9.2% AUTO COMPONENTS - 1.3% Modine Manufacturing Co. 52,500 1,708,875 Nokian Renkaat Oyj 26,600 4,710,921 ------------- Auto Components Total 6,419,796 HOTELS, RESTAURANTS & LEISURE - 0.7% Fairmont Hotels & Resorts, Inc. 50,000 1,607,000 McDonald's Corp. 50,000 1,654,000 Six Flags, Inc. (a) 100,000 446,000 ------------- Hotels, Restaurants & Leisure Total 3,707,000 HOUSEHOLD DURABLES - 1.2% Cavco Industries, Inc. (a) 26,000 697,580 Ekornes ASA 60,000 1,339,496 Leggett & Platt, Inc. 37,500 1,037,625 Makita Corp., ADR 62,000 1,184,820 Matsushita Electric Industrial Co., Ltd., ADR 100,000 1,494,000 Pioneer Corp., ADR 30,000 527,400 ------------- Household Durables Total 6,280,921 INTERNET & CATALOG RETAIL - 0.4% 1-800-FLOWERS.COM, Inc., Class A (a) 100,000 750,000 IAC/InterActiveCorp (a) 57,500 1,293,750 ------------- Internet & Catalog Retail Total 2,043,750 LEISURE EQUIPMENT & PRODUCTS - 0.3% Eastman Kodak Co. 47,500 1,614,525 ------------- Leisure Equipment & Products Total 1,614,525 MEDIA - 2.5% Comcast Corp., Class A (a) 67,500 2,150,550 Entravision Communications Corp., Class A (a) 75,000 615,000 Grupo Televisa SA, ADR 20,000 1,289,000 Liberty Media Corp., Class A (a) 125,000 1,267,500 Liberty Media International, Inc., Class A (a) 5,500 237,765 McGraw-Hill Companies, Inc. 12,500 1,148,125 Media General, Inc., Class A 30,000 1,919,700 Time Warner, Inc. (a) 125,000 2,153,750 Westwood One, Inc. (a) 50,000 1,092,000 World Wrestling Entertainment, Inc. 50,000 633,000 ------------- Media Total 12,506,390 MULTILINE RETAIL - 2.2% Big Lots, Inc. (a) 100,000 1,167,000 Dillard's, Inc., Class A 50,000 1,165,000 Fred's, Inc. 100,000 1,685,000 Kohl's Corp. (a) 20,000 957,400 May Department Stores Co. 62,500 2,156,875 SHARES VALUE ($) ------- ------------- Saks, Inc. (a) 75,000 1,139,250 Stockmann Oyj ABP, Class B 75,000 2,552,859 ------------- Multiline Retail Total 10,823,384 SPECIALTY RETAIL - 0.6% Bombay Co., Inc. (a) 100,000 570,000 CarMax, Inc. (a) 47,500 1,567,500 Restoration Hardware, Inc. (a) 125,000 663,750 ------------- Specialty Retail Total 2,801,250 ------------- CONSUMER DISCRETIONARY TOTAL 46,197,016 CONSUMER STAPLES - 5.2% BEVERAGES - 0.9% Coca-Cola Co. 67,500 2,889,000 Coca-Cola Femsa, SA de CV, ADR 57,500 1,477,750 ------------- Beverages Total 4,366,750 FOOD & STAPLES RETAILING - 1.1% Albertson's, Inc. 75,000 1,679,250 United Natural Foods, Inc. (a) 42,500 1,324,725 Walgreen Co. 62,500 2,676,875 ------------- Food & Staples Retailing Total 5,680,850 FOOD PRODUCTS - 1.4% Campbell Soup Co. 30,000 831,000 Delta & Pine Land Co. 50,000 1,449,500 General Mills, Inc. 32,500 1,702,025 Hain Celestial Group, Inc. (a) 40,000 746,800 Unilever NV, NY Registered Shares 37,500 2,508,375 ------------- Food Products Total 7,237,700 HOUSEHOLD PRODUCTS - 0.4% Kimberly-Clark Corp. 27,500 1,814,450 ------------- Household Products Total 1,814,450 PERSONAL PRODUCTS - 0.8% Avon Products, Inc. 55,000 2,352,350 Natura Cosmeticos SA 52,500 1,545,907 ------------- Personal Products Total 3,898,257 TOBACCO - 0.6% Altria Group, Inc. 50,000 3,282,500 ------------- Tobacco Total 3,282,500 ------------- CONSUMER STAPLES TOTAL 26,280,507 ENERGY - 9.9% ENERGY EQUIPMENT & SERVICES - 5.4% Core Laboratories NV (a) 50,000 1,344,500 GlobalSantaFe Corp. 30,000 1,125,000 Halliburton Co. 62,500 2,748,125 Input/Output, Inc. (a) 200,500 1,479,690 Nabors Industries Ltd. (a) 25,000 1,435,000 Newpark Resources, Inc. (a) 117,500 750,825 86 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Strategic Investor Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - (CONTINUED) ENERGY - (CONTINUED) ENERGY EQUIPMENT & SERVICES - (CONTINUED) Schlumberger Ltd. 57,500 4,338,375 Stolt Offshore SA, ADR (a) 100,000 785,000 TGS Nopec Geophysical Co., ASA (a) 105,000 3,334,574 Transocean, Inc. (a) 100,000 4,848,000 Varco International, Inc. (a) 75,000 2,828,250 Willbros Group, Inc. (a) 100,000 2,150,000 ------------- Energy Equipment & Services Total 27,167,339 OIL & GAS - 4.5% Apache Corp. 20,000 1,257,600 BP PLC, ADR 37,500 2,434,500 ConocoPhillips 25,000 2,772,250 El Paso Corp. 40,000 493,200 Exxon Mobil Corp. 60,000 3,798,600 McMoRan Exploration Co. (a) 97,500 2,022,150 Newfield Exploration Co. (a) 45,000 3,341,250 Petroleo Brasileiro SA, ADR 30,000 1,464,000 Plains Exploration & Production Co. (a) 42,500 1,445,425 Statoil ASA, ADR 100,000 1,820,000 Valero Energy Corp. 21,000 1,496,040 ------------- Oil & Gas Total 22,345,015 ------------- ENERGY TOTAL 49,512,354 FINANCIALS - 11.1% CAPITAL MARKETS - 2.0% Bank of New York Co., Inc. 37,500 1,134,375 Charles Schwab Corp. 107,500 1,128,750 LaBranche & Co., Inc. (a) 50,000 462,500 Morgan Stanley 67,500 3,811,725 Nikko Cordial Corp. 130,000 647,242 Nomura Holdings, Inc., ADR 100,000 1,385,000 Piper Jaffray Companies, Inc. (a) 42,350 1,674,943 ------------- Capital Markets Total 10,244,535 COMMERCIAL BANKS - 3.0% Allied Irish Banks PLC, ADR 30,000 1,282,500 Fifth Third Bancorp 27,500 1,231,175 HSBC Holdings PLC, ADR 37,500 3,130,875 ICICI Bank Ltd., ADR 47,500 1,075,875 Mitsubishi Tokyo Financial Group, Inc., ADR 225,000 2,063,250 SunTrust Banks, Inc. 22,500 1,629,900 U.S. Bancorp 75,000 2,231,250 Zions Bancorporation 32,500 2,148,250 ------------- Commercial Banks Total 14,793,075 CONSUMER FINANCE - 0.2% MBNA Corp. 42,500 1,078,225 ------------- Consumer Finance Total 1,078,225 SHARES VALUE ($) ------- ------------- DIVERSIFIED FINANCIAL SERVICES - 2.0% Citigroup, Inc. 67,500 3,221,100 eSpeed, Inc., Class A (a) 50,000 449,000 GATX Corp. 62,500 1,873,750 JPMorgan Chase & Co. 120,200 4,393,310 ------------- Diversified Financial Services Total 9,937,160 INSURANCE - 2.7% American International Group, Inc. 12,500 835,000 Chubb Corp. 10,000 791,100 Hannover Rueckversicherung AG, Registered Shares 67,500 2,895,437 Jefferson-Pilot Corp. 30,000 1,468,800 Marsh & McLennan Companies, Inc. 35,000 1,142,750 Max Re Capital Ltd. 40,000 920,400 PartnerRe Ltd. 20,000 1,253,000 St. Paul Travelers Companies, Inc. 32,505 1,245,591 Wesco Financial Corp. 7,750 3,061,250 ------------- Insurance Total 13,613,328 REAL ESTATE - 0.6% Crescent Real Estate Equities Co., REIT 30,000 489,000 Mitsubishi Estate Co., Ltd. 125,000 1,524,840 Post Properties, Inc., REIT 30,000 967,500 ------------- Real Estate Total 2,981,340 THRIFTS & MORTGAGE FINANCE - 0.6% Freddie Mac 27,500 1,705,000 MGIC Investment Corp. 20,000 1,254,800 ------------- Thrifts & Mortgage Finance Total 2,959,800 ------------- FINANCIALS TOTAL 55,607,463 HEALTH CARE - 10.7% BIOTECHNOLOGY - 1.2% Amgen, Inc. (a) 27,500 1,694,275 Applera Corp. - Applied Biosystems Group 50,000 1,027,000 Biogen Idec, Inc. (a) 20,000 773,000 MedImmune, Inc. (a) 32,500 782,600 Qiagen NV (a) 130,000 1,618,500 ------------- Biotechnology Total 5,895,375 HEALTH CARE EQUIPMENT & SUPPLIES - 2.2% Baxter International, Inc. 82,500 2,941,950 Boston Scientific Corp. (a) 40,000 1,306,400 Cytyc Corp. (a) 40,000 912,000 Haemonetics Corp. (a) 50,000 2,074,000 Hospira, Inc. (a) 87,500 2,590,000 National Dentex Corp. (a) 24,478 465,082 Steris Corp. (a) 40,000 990,000 ------------- Health Care Equipment & Supplies Total 11,279,432 See Accompanying Notes to Financial Statements. | 87 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Strategic Investor Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - (CONTINUED) HEALTH CARE - (CONTINUED) HEALTH CARE PROVIDERS & SERVICES - 2.6% Accredo Health, Inc. (a) 32,500 1,385,150 Community Health Systems, Inc. (a) 50,000 1,618,500 Health Management Associates, Inc., Class A 30,000 689,100 Henry Schein, Inc. (a) 22,500 1,627,650 LifePoint Hospitals, Inc. (a) 24,000 961,200 McKesson Corp. 56,000 2,091,040 Omnicare, Inc. 50,000 1,724,500 Quest Diagnostics, Inc. 12,500 1,242,500 Tenet Healthcare Corp. (a) 47,500 518,225 Triad Hospitals, Inc. (a) 23,000 1,004,410 ------------- Health Care Providers & Services Total 12,862,275 PHARMACEUTICALS - 4.7% Abbott Laboratories 50,000 2,299,500 Andrx Corp. (a) 60,000 1,347,000 Dr. Reddy's Laboratories Ltd., ADR 30,000 528,600 Elan Corp. PLC, ADR (a) 40,000 320,000 Eli Lilly & Co. 45,000 2,520,000 Endo Pharmaceuticals Holdings, Inc. (a) 50,000 1,126,500 Gedeon Richter Rt. 12,500 1,917,969 Merck & Co., Inc. 40,000 1,268,000 Novartis AG, ADR 30,000 1,499,100 Pfizer, Inc. 63,700 1,674,673 Schering-Plough Corp. 100,000 1,895,000 Shire Pharmaceuticals Group PLC, ADR 32,500 1,093,625 Taro Pharmaceuticals Industries Ltd. (a) 50,000 1,411,500 Valeant Pharmaceuticals International 77,500 1,879,375 Watson Pharmaceuticals, Inc. (a) 62,500 1,983,750 Wyeth 20,000 816,400 ------------- Pharmaceuticals Total 23,580,992 ------------- HEALTH CARE TOTAL 53,618,074 INDUSTRIALS - 10.8% AEROSPACE & DEFENSE - 0.7% BE Aerospace, Inc. (a) 72,500 872,175 Honeywell International, Inc. 40,000 1,518,800 Raytheon Co. 30,000 1,147,200 ------------- Aerospace & Defense Total 3,538,175 AIR FREIGHT & LOGISTICS - 0.6% United Parcel Service, Inc., Class B 17,500 1,356,075 Yamato Transport Co., Ltd. 100,000 1,592,526 ------------- Air Freight & Logistics Total 2,948,601 SHARES VALUE ($) ------- ------------- AIRLINES - 0.3% AMR Corp. (a) 100,000 849,000 Continental Airlines, Inc., Class B (a) 75,000 803,250 ------------- Airlines Total 1,652,250 BUILDING PRODUCTS - 0.2% Toto Ltd. 100,000 861,535 ------------- Building Products Total 861,535 COMMERCIAL SERVICES & SUPPLIES - 2.3% Asset Acceptance Capital Corp. (a) 40,000 812,400 Avery Dennison Corp. 52,500 3,186,750 Cendant Corp. 90,000 1,990,800 Central Parking Corp. 30,000 415,800 PHH Corp. (a) 4,500 94,500 R.R. Donnelley & Sons Co. 62,500 2,075,625 Tetra Tech, Inc. (a) 62,500 1,036,250 Tomra Systems ASA 130,000 554,359 Waste Management, Inc. 50,000 1,462,000 ------------- Commercial Services & Supplies Total 11,628,484 CONSTRUCTION & ENGINEERING - 0.5% Foster Wheeler Ltd. (a) 50,000 897,500 Shaw Group, Inc. (a) 87,500 1,820,000 ------------- Construction & Engineering Total 2,717,500 ELECTRICAL EQUIPMENT - 0.6% Thomas & Betts Corp. (a) 90,000 2,797,200 ------------- Electrical Equipment Total 2,797,200 INDUSTRIAL CONGLOMERATES - 1.5% 3M Co. 62,500 5,246,250 General Electric Co. 60,000 2,112,000 ------------- Industrial Conglomerates Total 7,358,250 MACHINERY - 3.4% AGCO Corp. (a) 40,000 778,800 Bucyrus International, Inc., Class A 27,500 1,194,325 Caterpillar, Inc. 32,500 3,089,125 Deere & Co. 10,000 711,100 Eaton Corp. 40,000 2,790,000 Flowserve Corp. (a) 30,000 749,700 Hitachi Construction Machinery Co., Ltd. 125,000 1,827,363 JLG Industries, Inc. 30,000 642,000 Munters AB 25,000 695,135 Navistar International Corp. (a) 37,500 1,479,750 Pall Corp. 62,500 1,691,875 Timken Co. 52,500 1,485,750 ------------- Machinery Total 17,134,923 MARINE - 0.6% A.P. Moller - Maersk A/S 140 1,313,556 Finnlines Oyj 80,000 1,488,388 ------------- Marine Total 2,801,944 88 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Strategic Investor Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - (CONTINUED) INDUSTRIALS - (CONTINUED) ROAD & RAIL - 0.1% Kansas City Southern (a) 27,500 539,550 ------------- Road & Rail Total 539,550 ------------- INDUSTRIALS TOTAL 53,978,412 INFORMATION TECHNOLOGY - 6.9% COMMUNICATIONS EQUIPMENT - 1.2% ADC Telecommunications, Inc. (a) 100,000 230,000 Andrew Corp. (a) 40,000 484,000 Comverse Technology, Inc. (a) 40,000 928,400 Lucent Technologies, Inc. (a) 100,000 307,000 Nokia Oyj, ADR 75,000 1,210,500 Polycom, Inc. (a) 47,500 769,025 Tandberg ASA 130,000 1,450,737 UTStarcom, Inc. (a) 52,500 674,625 ------------- Communications Equipment Total 6,054,287 COMPUTERS & PERIPHERALS - 0.5% Brocade Communications Systems, Inc. (a) 75,000 465,000 Hypercom Corp. (a) 75,000 352,500 International Business Machines Corp. 10,000 925,800 Sun Microsystems, Inc. (a) 200,000 844,000 ------------- Computers & Peripherals Total 2,587,300 ELECTRONIC EQUIPMENT & INSTRUMENTS - 0.2% Celestica, Inc. (a) 72,500 932,350 ------------- Electronic Equipment & Instruments Total 932,350 INTERNET SOFTWARE & SERVICES - 0.1% NIC, Inc. (a) 75,000 381,000 ------------- Internet Software & Services Total 381,000 IT SERVICES - 1.0% Convergys Corp. (a) 65,000 974,350 DST Systems, Inc. (a) 52,500 2,493,225 First Data Corp. 38,250 1,569,015 ------------- IT Services Total 5,036,590 OFFICE ELECTRONICS - 0.2% Xerox Corp. (a) 75,000 1,170,000 ------------- Office Electronics Total 1,170,000 SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 2.3% Advanced Micro Devices (a) 67,500 1,177,875 Fairchild Semiconductor International, Inc. (a) 60,000 991,200 FEI Co. (a) 75,000 1,856,250 LSI Logic Corp. (a) 125,000 797,500 National Semiconductor Corp. 50,000 997,500 Samsung Electronics Co., Ltd., GDR (b) 15,000 3,885,000 SHARES VALUE ($) ------- ------------- Texas Instruments, Inc. 67,500 1,786,725 ------------- Semiconductors & Semiconductor Equipment Total 11,492,050 SOFTWARE - 1.4% Aspect Communications Corp. (a) 70,000 763,000 Cadence Design Systems, Inc. (a) 50,000 689,000 Check Point Software Technologies Ltd. (a) 57,500 1,272,475 Computer Associates International, Inc. 33 894 Microsoft Corp. 100,000 2,518,000 Novell, Inc. (a) 100,000 524,000 Parametric Technology Corp. (a) 100,000 575,000 Quest Software, Inc. (a) 40,000 542,800 ------------- Software Total 6,885,169 ------------- INFORMATION TECHNOLOGY TOTAL 34,538,746 MATERIALS - 5.9% CHEMICALS - 3.1% Air Products & Chemicals, Inc. 37,500 2,348,250 Calgon Carbon Corp. 100,000 873,000 Dow Chemical Co. 30,000 1,654,500 E.I. du Pont de Nemours & Co. 32,500 1,732,250 International Flavors & Fragrances, Inc. 47,500 1,961,275 Lyondell Chemical Co. 37,500 1,269,375 Mosaic Co. (a) 40,000 658,400 Potash Corp. of Saskatchewan, Inc. 50,000 4,441,000 Zeon Corp. 75,000 588,240 ------------- Chemicals Total 15,526,290 CONSTRUCTION MATERIALS - 0.3% Martin Marietta Materials, Inc. 27,500 1,586,200 ------------- Construction Materials Total 1,586,200 CONTAINERS & PACKAGING - 0.4% Sealed Air Corp. (a) 20,000 1,045,400 Smurfit-Stone Container Corp. (a) 50,000 831,500 ------------- Containers & Packaging Total 1,876,900 METALS & MINING - 1.7% Alpha Natural Resources, Inc. (a) 31,100 808,600 Centerra Gold, Inc. (a) 75,000 1,209,511 Companhia Vale do Rio Doce, ADR 112,500 3,937,500 CONSOL Energy, Inc. 20,000 916,800 Gammon Lake Resources, Inc. (a) 50,000 287,000 WMC Resources Ltd., ADR 50,000 1,205,000 ------------- Metals & Mining Total 8,364,411 PAPER & FOREST PRODUCTS - 0.4% Bowater, Inc. 20,000 776,600 Votorantim Celulose e Papel SA, ADR 100,000 1,480,000 ------------- Paper & Forest Products Total 2,256,600 ------------- MATERIALS TOTAL 29,610,401 See Accompanying Notes to Financial Statements. | 89 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Strategic Investor Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - (CONTINUED) TELECOMMUNICATION SERVICES - 2.0% DIVERSIFIED TELECOMMUNICATION SERVICES - 1.4% BellSouth Corp. 40,000 1,032,000 Cincinnati Bell, Inc. (a) 100,000 440,000 Compania Anonima Nacional Telefonos de Venezuela, ADR 75,000 1,567,500 SBC Communications, Inc. 42,500 1,022,125 Telekomunikasi Indonesia, ADR 70,000 1,344,700 Verizon Communications, Inc. 47,500 1,708,575 ------------- Diversified Telecommunication Services Total 7,114,900 WIRELESS TELECOMMUNICATION SERVICES - 0.6% Millicom International Cellular SA (a) 50,000 1,121,500 Nextel Partners, Inc., Class A (a) 50,000 995,500 VimpelCom, ADR (a) 22,500 902,250 ------------- Wireless Telecommunication Services Total 3,019,250 ------------- TELECOMMUNICATION SERVICES TOTAL 10,134,150 UTILITIES - 2.8% ELECTRIC UTILITIES - 1.6% Edison International 65,000 2,111,200 Entergy Corp. 20,000 1,382,400 Exelon Corp. 30,000 1,360,800 Northeast Utilities 38,400 716,928 TECO Energy, Inc. 100,000 1,589,000 Westar Energy, Inc. 30,000 689,400 ------------- Electric Utilities Total 7,849,728 GAS UTILITIES - 0.3% NiSource, Inc. 75,000 1,698,000 ------------- Gas Utilities Total 1,698,000 MULTI-UTILITIES & UNREGULATED POWER - 0.7% Duke Energy Corp. 57,500 1,551,925 Dynegy, Inc., Class A (a) 100,000 416,000 ONEOK, Inc. 47,500 1,391,750 ------------- Multi-Utilities & Unregulated Power Total 3,359,675 WATER UTILITIES - 0.2% California Water Service Group 30,000 1,026,000 ------------- Water Utilities Total 1,026,000 ------------- UTILITIES TOTAL 13,933,403 Total Common Stocks (Cost of $285,263,214) 373,410,526 INVESTMENT COMPANIES - 0.5% Japan Smaller Capitalization Fund, Inc. (a) 125,000 1,525,000 Thai Fund, Inc. 107,500 1,186,800 ------------- Total Investment Companies (Cost of $1,910,310) 2,711,800 PAR ($) VALUE ($) ------- ------------- SHORT-TERM OBLIGATIONS - 24.4% U.S. GOVERNMENT AGENCY - 2.5% Federal Home Loan Bank 2.050% 03/01/05 (c) 12,212,000 12,212,000 ------------- REPURCHASE AGREEMENT - 21.9% Repurchase agreement with State Street Bank & Trust Co., dated 02/28/05, due 03/01/05 at 2.500%, collateralized by U.S. Treasury Bills with various maturities to 08/25/05, market value of $112,114,200 (repurchase proceeds $109,919,633) 109,912,000 109,912,000 ------------- Total Short-Term Obligations (Cost of $122,124,000) 122,124,000 TOTAL INVESTMENTS - 99.4% (COST OF $409,297,524) (d) 498,246,326 OTHER ASSETS & LIABILITIES, NET - 0.6% 2,880,355 NET ASSETS - 100.0% 501,126,681 NOTES TO INVESTMENT PORTFOLIO: (a) Non-income producing security. (b) Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933. This security may be resold in transactions exempt from registration, normally to qualified institutional buyers. At February 28, 2005, the value of this security represents 0.8% of net assets. (c) The rate shown represents the annualized yield at the date of purchase. (d) Cost for federal income tax purposes is $409,297,524. At February 28, 2005, the Fund held investments in the following sectors: % OF SECTOR NET ASSETS ---------------------------------------------------------------- Financials 11.1% Industrials 10.8 Health Care 10.7 Energy 9.9 Consumer Discretionary 9.2 Information Technology 6.9 Materials 5.9 Consumer Staples 5.2 Utilities 2.8 Telecommunication Services 2.0 Investment Companies 0.5 Short-Term Obligations 24.4 Other Assets & Liabilities, Net 0.6 ------ 100.0% ====== ACRONYM NAME ------- ---- ADR American Depositary Receipt GDR Global Depositary Receipt REIT Real Estate Investment Trust 90 | See Accompanying Notes to Financial Statements. INVESTMENT PORTFOLIO ___________________________________________________________ February 28, 2005 (Unaudited) Columbia Balanced Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - 58.8% CONSUMER DISCRETIONARY - 12.0% AUTOMOBILES - 1.1% General Motors Corp. 122,820 4,380,989 ------------- Automobiles Total 4,380,989 HOTELS, RESTAURANTS & LEISURE - 0.6% Darden Restaurants, Inc. 78,450 2,102,460 ------------- Hotels, Restaurants & Leisure Total 2,102,460 INTERNET & CATALOG RETAIL - 0.9% Amazon.com, Inc. (a) 64,350 2,263,833 eBay, Inc. (a) 28,140 1,205,518 ------------- Internet & Catalog Retail Total 3,469,351 LEISURE EQUIPMENT & PRODUCTS - 0.4% Hasbro, Inc. 75,050 1,585,056 ------------- Leisure Equipment & Products Total 1,585,056 MEDIA - 6.8% Clear Channel Communications, Inc. 42,220 1,405,082 Comcast Corp., Class A (a) 139,656 4,545,803 DirecTV Group, Inc. (a) 254,430 3,818,994 Liberty Media Corp., Class A (a) 428,310 4,343,063 Liberty Media International, Inc., Class A (a) 30,665 1,325,648 News Corp., Class A 129,080 2,147,891 Time Warner, Inc. (a) 278,460 4,797,866 Viacom, Inc., Class B 103,890 3,625,761 ------------- Media Total 26,010,108 MULTILINE RETAIL - 1.3% Kohl's Corp. (a) 54,890 2,627,584 May Department Stores Co. 67,390 2,325,629 ------------- Multiline Retail Total 4,953,213 SPECIALTY RETAIL - 0.9% RadioShack Corp. 118,630 3,506,703 ------------- Specialty Retail Total 3,506,703 ------------- CONSUMER DISCRETIONARY TOTAL 46,007,880 CONSUMER STAPLES - 3.1% BEVERAGES - 0.3% Coca-Cola Co. 26,990 1,155,172 ------------- Beverages Total 1,155,172 FOOD & STAPLES RETAILING - 1.0% Wal-Mart Stores, Inc. 71,270 3,678,245 ------------- Food & Staples Retailing Total 3,678,245 SHARES VALUE ($) ------- ------------- FOOD PRODUCTS - 0.4% Sara Lee Corp. 71,250 1,596,000 ------------- Food Products Total 1,596,000 HOUSEHOLD PRODUCTS - 0.7% Colgate-Palmolive Co. 48,360 2,559,211 ------------- Household Products Total 2,559,211 TOBACCO - 0.7% Altria Group, Inc. 43,575 2,860,699 ------------- Tobacco Total 2,860,699 ------------- CONSUMER STAPLES TOTAL 11,849,327 ENERGY - 2.4% ENERGY EQUIPMENT & SERVICES - 0.6% Transocean, Inc. (a) 45,290 2,195,659 ------------- Energy Equipment & Services Total 2,195,659 OIL & GAS - 1.8% Anadarko Petroleum Corp. 29,840 2,293,503 BP PLC, ADR 22,510 1,461,349 Devon Energy Corp. 68,290 3,195,289 ------------- Oil & Gas Total 6,950,141 ------------- ENERGY TOTAL 9,145,800 FINANCIALS - 9.9% CAPITAL MARKETS - 1.2% A.G. Edwards, Inc. 33,370 1,438,581 E*TRADE Financial Corp. (a) 98,200 1,303,114 Morgan Stanley 35,835 2,023,602 ------------- Capital Markets Total 4,765,297 COMMERCIAL BANKS - 0.6% Fifth Third Bancorp 49,990 2,238,052 ------------- Commercial Banks Total 2,238,052 CONSUMER FINANCE - 0.7% American Express Co. 46,925 2,540,989 ------------- Consumer Finance Total 2,540,989 DIVERSIFIED FINANCIAL SERVICES - 2.0% Citigroup, Inc. 84,343 4,024,848 JPMorgan Chase & Co. 99,460 3,635,263 ------------- Diversified Financial Services Total 7,660,111 INSURANCE - 3.9% Ace Ltd. 74,870 3,328,720 Allstate Corp. 29,680 1,593,222 Berkshire Hathaway, Inc., Class B (a) 1,266 3,816,990 Chubb Corp. 19,205 1,519,308 UnumProvident Corp. 286,660 4,850,287 ------------- Insurance Total 15,108,527 See Accompanying Notes to Financial Statements. | 91 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Balanced Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - (CONTINUED) FINANCIALS - (CONTINUED) THRIFTS & MORTGAGE FINANCE - 1.5% MGIC Investment Corp. 92,200 5,784,628 ------------- Thrifts & Mortgage Finance Total 5,784,628 ------------- FINANCIALS TOTAL 38,097,604 HEALTH CARE - 7.1% BIOTECHNOLOGY - 0.8% Amgen, Inc. (a) 28,113 1,732,042 MedImmune, Inc. (a) 60,380 1,453,951 ------------- Biotechnology Total 3,185,993 HEALTH CARE PROVIDERS & SERVICES - 2.3% Cardinal Health, Inc. 58,520 3,426,346 McKesson Corp. 32,460 1,212,056 WebMD Corp. (a) 573,070 4,320,948 ------------- Health Care Providers & Services Total 8,959,350 PHARMACEUTICALS - 4.0% Barr Pharmaceuticals, Inc. (a) 106,870 5,101,974 Biovail Corp. (a) 156,720 2,513,789 Eli Lilly & Co. 20,455 1,145,480 Endo Pharmaceuticals Holdings, Inc. (a) 111,320 2,508,039 IVAX Corp. (a) 95,320 1,524,167 Pfizer, Inc. 95,970 2,523,051 ------------- Pharmaceuticals Total 15,316,500 ------------- HEALTH CARE TOTAL 27,461,843 INDUSTRIALS - 3.8% AIRLINES - 0.8% Southwest Airlines Co. 229,990 3,185,362 ------------- Airlines Total 3,185,362 COMMERCIAL SERVICES & SUPPLIES - 1.4% ARAMARK Corp., Class B 50,740 1,422,242 Cintas Corp. 29,740 1,302,017 Waste Management, Inc. 83,345 2,437,008 ------------- Commercial Services & Supplies Total 5,161,267 CONSTRUCTION & ENGINEERING - 0.4% Jacobs Engineering Group, Inc. (a) 27,900 1,561,842 ------------- Construction & Engineering Total 1,561,842 MACHINERY - 0.7% Dover Corp. 64,000 2,474,880 ------------- Machinery Total 2,474,880 SHARES VALUE ($) ------- ------------- ROAD & RAIL - 0.5% Union Pacific Corp. 32,660 2,072,277 ------------- Road & Rail Total 2,072,277 ------------- INDUSTRIALS TOTAL 14,455,628 INFORMATION TECHNOLOGY - 11.9% COMMUNICATIONS EQUIPMENT - 1.8% Cisco Systems, Inc. (a) 116,040 2,021,417 Corning, Inc. (a) 103,600 1,188,292 Lucent Technologies, Inc. (a) 292,520 898,036 Nortel Networks Corp. (a) 1,066,090 2,857,121 ------------- Communications Equipment Total 6,964,866 COMPUTERS & PERIPHERALS - 4.0% Hewlett-Packard Co. 185,280 3,853,824 International Business Machines Corp. 49,480 4,580,859 SanDisk Corp. (a) 195,790 5,262,835 Sun Microsystems, Inc. (a) 404,520 1,707,074 ------------- Computers & Peripherals Total 15,404,592 ELECTRONIC EQUIPMENT & INSTRUMENTS - 0.3% Agilent Technologies, Inc. (a) 52,350 1,256,400 ------------- Electronic Equipment & Instruments Total 1,256,400 SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 3.2% Analog Devices, Inc. 35,220 1,293,279 Broadcom Corp., Class A (a) 42,260 1,362,885 Intel Corp. 199,670 4,788,087 Linear Technology Corp. 98,620 3,852,097 Maxim Integrated Products, Inc. 27,010 1,161,970 ------------- Semiconductors & Semiconductor Equipment Total 12,458,318 SOFTWARE - 2.6% Fair Isaac Corp. 36,400 1,230,320 Microsoft Corp. 225,900 5,688,162 Oracle Corp. (a) 227,765 2,940,446 ------------- Software Total 9,858,928 ------------- INFORMATION TECHNOLOGY TOTAL 45,943,104 MATERIALS - 5.6% CHEMICALS - 1.4% E.I. du Pont de Nemours & Co. 103,960 5,541,068 ------------- Chemicals Total 5,541,068 CONTAINERS & PACKAGING - 2.1% Sealed Air Corp. (a) 66,600 3,481,182 Smurfit-Stone Container Corp. (a) 270,700 4,501,741 ------------- Containers & Packaging Total 7,982,923 92 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Balanced Fund SHARES VALUE ($) ------- ------------- COMMON STOCKS - (CONTINUED) MATERIALS - (CONTINUED) METALS & MINING - 1.8% Alcoa, Inc. 104,800 3,366,176 International Steel Group, Inc. (a) 84,870 3,543,322 ------------- Metals & Mining Total 6,909,498 PAPER & FOREST PRODUCTS - 0.3% Sappi Ltd., ADR 96,680 1,297,446 ------------- Paper & Forest Products Total 1,297,446 ------------- MATERIALS TOTAL 21,730,935 TELECOMMUNICATION SERVICES - 3.0% DIVERSIFIED TELECOMMUNICATION SERVICES - 2.4% Brasil Telecom Participacoes SA, ADR 7,010 238,340 CenturyTel, Inc. 43,590 1,466,368 Qwest Communications International, Inc. (a) 570,000 2,223,000 Telefonos de Mexico SA de CV, ADR 60,840 2,385,536 Verizon Communications, Inc. 77,500 2,787,675 ------------- Diversified Telecommunication Services Total 9,100,919 WIRELESS TELECOMMUNICATION SERVICES - 0.6% Nextel Communications, Inc., Class A (a) 84,670 2,491,838 ------------- Wireless Telecommunication Services Total 2,491,838 ------------- TELECOMMUNICATION SERVICES TOTAL 11,592,757 Total Common Stocks (Cost of $208,194,707) 226,284,878 MORTGAGE-BACKED OBLIGATIONS - 14.5% PAR ($) Federal Home Loan Mortgage Corp. 4.000% 09/15/15-10/15/26 15,120,000 14,722,003 4.500% 10/15/18-08/15/28 23,632,638 23,401,241 5.000% 05/01/34 1,933,320 1,909,877 5.500% 12/01/18-07/01/19 2,291,193 2,350,916 6.000% 03/01/17-08/01/17 1,968,653 2,046,454 6.500% 11/15/30-08/01/32 1,049,785 1,082,347 Federal Housing Administration 9.125% 03/25/33 1,537,910 1,553,289 Federal National Mortgage Association 4.500% 11/25/14 630,000 631,006 5.000% 07/01/18-10/01/18 4,557,088 4,594,652 5.842% 07/01/32 (b) 796,702 821,719 6.500% 07/25/30-12/25/30 1,924,456 1,937,691 7.000% 10/15/31-04/15/32 318,651 337,535 PAR ($) VALUE ($) ------- ------------- Government National Mortgage Association 7.000% 05/15/32 303,363 321,336 ------------- Total Mortgage-Backed Obligations (Cost of $55,706,857) 55,710,066 CORPORATE FIXED-INCOME BONDS & NOTES - 13.8% BASIC MATERIALS - 0.3% CHEMICALS - 0.1% Airgas, Inc. 9.125% 10/01/11 75,000 83,062 EquiStar Chemicals LP 10.125% 09/01/08 25,000 28,813 10.625% 05/01/11 25,000 28,938 Ethyl Corp. 8.875% 05/01/10 50,000 55,000 MacDermid, Inc. 9.125% 07/15/11 50,000 55,312 Nalco Co. 7.750% 11/15/11 25,000 27,063 ------------- Chemicals Total 278,188 FOREST PRODUCTS & PAPER - 0.0% Boise Cascade LLC 7.125% 10/15/14 (c) 95,000 101,175 ------------- Forest Products & Paper Total 101,175 IRON/STEEL - 0.0% Russel Metals, Inc. 6.375% 03/01/14 65,000 65,813 ------------- Iron/Steel Total 65,813 MINING - 0.2% Alcan, Inc. 7.250% 03/15/31 675,000 826,889 ------------- Mining Total 826,889 ------------- BASIC MATERIALS TOTAL 1,272,065 COMMUNICATIONS - 1.9% MEDIA - 0.7% Comcast Corp. 7.050% 03/15/33 375,000 436,189 Dex Media West LLC 5.875% 11/15/11 (c) 30,000 29,850 DirecTV Holdings 8.375% 03/15/13 170,000 191,887 EchoStar DBS Corp. 5.750% 10/01/08 90,000 91,350 6.625% 10/01/14 (c) 85,000 87,444 Emmis Operating Co. 6.875% 05/15/12 35,000 35,700 Lamar Media Corp. 7.250% 01/01/13 175,000 189,000 See Accompanying Notes to Financial Statements. | 93 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Balanced Fund PAR ($) VALUE ($) ------- ------------- CORPORATE FIXED-INCOME BONDS & NOTES - (CONTINUED) COMMUNICATIONS - (CONTINUED) MEDIA - (CONTINUED) LIN Television Corp. 6.500% 05/15/13 100,000 102,250 Rogers Cable, Inc. 7.875% 05/01/12 100,000 110,750 R.H. Donnelley Finance Corp. 10.875% 12/15/12 (c) 115,000 135,125 TCI Communcations, Inc. 7.250% 08/01/05 335,000 340,159 Time Warner, Inc. 6.625% 05/15/29 775,000 843,905 ------------- Media Total 2,593,609 TELECOMMUNICATIONS - 1.2% AT&T Wireless Services, Inc. 8.750% 03/01/31 750,000 1,021,342 Deutsche Telekom International Finance BV 8.500% 06/15/10 525,000 616,765 Nextel Communications, Inc. 6.875% 10/31/13 10,000 10,800 7.375% 08/01/15 175,000 191,625 Rogers Wireless, Inc. 7.500% 03/15/15 15,000 16,425 8.000% 12/15/12 105,000 113,925 Sprint Capital Corp. 6.875% 11/15/28 450,000 498,938 Verizon Global Funding Corp. 7.750% 12/01/30 1,100,000 1,366,255 Vodafone Group PLC 7.750% 02/15/10 750,000 857,752 ------------- Telecommunications Total 4,693,827 ------------- COMMUNICATIONS TOTAL 7,287,436 CONSUMER CYCLICAL - 1.4% AUTO MANUFACTURERS - 0.7% DaimlerChrysler NA Holding Corp. 8.500% 01/18/31 475,000 605,478 Ford Motor Credit Co. 7.375% 10/28/09 1,080,000 1,134,011 General Motors Acceptance Corp. 7.750% 01/19/10 850,000 889,006 ------------- Auto Manufacturers Total 2,628,495 ENTERTAINMENT - 0.1% Cinemark USA, Inc. 9.000% 02/01/13 95,000 106,044 Speedway Motorsports, Inc. 6.750% 06/01/13 96,000 100,680 Warner Music Group 7.375% 04/15/14 (c) 60,000 63,600 ------------- Entertainment Total 270,324 PAR ($) VALUE ($) ------- ------------- HOME BUILDERS - 0.1% KB Home 8.625% 12/15/08 125,000 141,562 Toll Corp. 8.250% 12/01/11 175,000 192,719 ------------- Home Builders Total 334,281 LEISURE TIME - 0.0% K2, Inc. 7.375% 07/01/14 60,000 64,920 Royal Caribbean Cruises Ltd. 6.750% 03/15/08 45,000 47,925 6.875% 12/01/13 50,000 54,625 8.750% 02/02/11 55,000 64,488 ------------- Leisure Time Total 231,958 LODGING - 0.2% Kerzner International 8.875% 08/15/11 75,000 81,750 MGM Mirage, Inc. 6.000% 10/01/09 45,000 46,125 9.750% 06/01/07 30,000 33,225 Park Place Entertainment Corp. 8.875% 09/15/08 15,000 16,987 9.375% 02/15/07 80,000 87,400 Starwood Hotels & Resorts Worldwide, Inc. 7.375% 05/01/07 150,000 159,375 Station Casinos, Inc. 6.875% 03/01/16 165,000 174,075 Wynn Las Vegas LLC 6.625% 12/01/14 (c) 70,000 70,175 ------------- Lodging Total 669,112 RETAIL - 0.3% Autonation, Inc. 9.000% 08/01/08 100,000 113,000 Couche-Tard 7.500% 12/15/13 125,000 134,062 Domino's, Inc. 8.250% 07/01/11 30,000 32,438 Group 1 Automotive, Inc. 8.250% 08/15/13 50,000 52,750 Lowe's Companies, Inc. 6.500% 03/15/29 700,000 802,158 Suburban Propane Partners 6.875% 12/15/13 45,000 46,125 ------------- Retail Total 1,180,533 ------------- CONSUMER CYCLICAL TOTAL 5,314,703 94 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Balanced Fund PAR ($) VALUE ($) ------- ------------- CORPORATE FIXED-INCOME BONDS & NOTES - (CONTINUED) CONSUMER NON-CYCLICAL - 1.3% BEVERAGES - 0.4% Constellation Brands, Inc. 8.000% 02/15/08 175,000 190,312 Cott Beverages, Inc. 8.000% 12/15/11 175,000 189,438 PepsiAmericas, Inc. 3.875% 09/12/07 1,000,000 993,430 ------------- Beverages Total 1,373,180 COMMERCIAL SERVICES - 0.1% Corrections Corp. of America 7.500% 05/01/11 125,000 132,969 Iron Mountain, Inc. 7.750% 01/15/15 150,000 153,375 United Rentals NA, Inc. 7.750% 11/15/13 105,000 105,525 ------------- Commercial Services Total 391,869 FOOD - 0.3% Kroger Co. 6.200% 06/15/12 650,000 701,727 Safeway, Inc. 4.950% 08/16/10 650,000 652,502 ------------- Food Total 1,354,229 HEALTHCARE SERVICES - 0.4% Extendicare Health Services 6.875% 05/01/14 30,000 30,600 9.500% 07/01/10 10,000 11,075 Fisher Scientific International, Inc. 6.750% 08/15/14 (c) 55,000 58,369 HCA, Inc. 6.950% 05/01/12 125,000 132,139 Province Healthcare Co. 7.500% 06/01/13 125,000 139,844 Triad Hospitals, Inc. 7.000% 05/15/12 100,000 106,500 WellPoint, Inc. 6.800% 08/01/12 925,000 1,036,323 ------------- Healthcare Services Total 1,514,850 HOUSEHOLD PRODUCTS/WARES - 0.0% Scotts Co. 6.625% 11/15/13 70,000 73,938 ------------- Household Products/Wares Total 73,938 PHARMACEUTICALS - 0.1% AmerisourceBergen Corp. 8.125% 09/01/08 60,000 66,600 Omnicare, Inc. 8.125% 03/15/11 175,000 186,375 ------------- Pharmaceuticals Total 252,975 ------------- CONSUMER NON-CYCLICAL TOTAL 4,961,041 PAR ($) VALUE ($) ------- ------------- ENERGY - 1.1% COAL - 0.1% Arch Western Finance 6.750% 07/01/13 (d) 155,000 160,813 Peabody Energy Corp. 6.875% 03/15/13 170,000 184,450 ------------- Coal Total 345,263 OIL & GAS - 0.7% Chesapeake Energy Corp. 6.375% 06/15/15 (c) 15,000 15,825 7.500% 09/15/13 145,000 159,862 Devon Energy Corp. 7.950% 04/15/32 550,000 713,520 Marathon Oil Corp. 6.800% 03/15/32 600,000 683,382 Newfield Exploration Co. 6.625% 09/01/14 (c) 130,000 139,913 Occidental Petroleum Corp. 4.250% 03/15/10 775,000 765,638 Plains Exploration & Production Co. 7.125% 06/15/14 90,000 99,000 Pogo Producing Co. 8.250% 04/15/11 20,000 21,400 Pride International, Inc. 7.375% 07/15/14 110,000 121,550 Vintage Petroleum, Inc. 7.875% 05/15/11 100,000 107,250 ------------- Oil & Gas Total 2,827,340 OIL & GAS SERVICES - 0.1% Grant Prideco, Inc. 9.000% 12/15/09 145,000 159,862 9.625% 12/01/07 15,000 16,688 Hornbeck Offshore Services, Inc. 6.125% 12/01/14 (c) 50,000 50,125 Universal Compression, Inc. 7.250% 05/15/10 95,000 99,750 ------------- Oil & Gas Services Total 326,425 PIPELINES - 0.2% Kinder Morgan Energy Partners LP 7.300% 08/15/33 600,000 715,338 MarkWest Energy Partners 6.875% 11/01/14 (c) 45,000 46,238 William Companies, Inc. 7.125% 09/01/11 15,000 16,500 8.125% 03/15/12 85,000 99,025 ------------- Pipelines Total 877,101 ------------- ENERGY TOTAL 4,376,129 See Accompanying Notes to Financial Statements. | 95 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Balanced Fund PAR ($) VALUE ($) ------- ------------- CORPORATE FIXED-INCOME BONDS & NOTES - (CONTINUED) FINANCIALS - 4.4% BANKS - 0.8% US Bank NA 6.375% 08/01/11 1,500,000 1,651,845 Wachovia Corp. 4.875% 02/15/14 300,000 297,597 Wells Fargo & Co. 5.900% 05/21/06 1,090,000 1,117,980 ------------- Banks Total 3,067,422 DIVERSIFIED FINANCIAL SERVICES - 2.7% American General Finance Corp. 5.375% 09/01/09 475,000 490,946 Capital One Bank 4.875% 05/15/08 525,000 532,738 CIT Group, Inc. 4.125% 02/21/06 575,000 577,944 Citigroup, Inc. 5.000% 09/15/14 1,450,000 1,451,421 Countrywide Home Loan, Inc. 2.875% 02/15/07 600,000 585,900 Goldman Sachs Group, Inc. 6.345% 02/15/34 745,000 793,127 Household Finance Corp. 6.400% 06/17/08 1,250,000 1,330,337 JPMorgan Chase & Co. 5.750% 01/02/13 1,000,000 1,052,220 Lehman Brothers Holdings, Inc. 4.000% 01/22/08 800,000 795,848 Merrill Lynch & Co., Inc. 4.125% 01/15/09 1,000,000 988,150 Morgan Stanley 4.750% 04/01/14 1,000,000 979,280 SLM Corp. 5.125% 08/27/12 990,000 1,008,355 ------------- Diversified Financial Services Total 10,586,266 INSURANCE - 0.4% Allstate Financial Global Funding II 2.625% 10/22/06 (c) 1,000,000 980,470 Genworth Financial, Inc. 4.750% 06/15/09 650,000 657,976 ------------- Insurance Total 1,638,446 REAL ESTATE INVESTMENT TRUSTS - 0.3% Health Care Property Investors, Inc. 6.450% 06/25/12 850,000 924,808 iStar Financial, Inc. 5.125% 04/01/11 25,000 24,979 7.000% 03/15/08 25,000 26,541 ------------- Real Estate Investment Trusts Total 976,328 PAR ($) VALUE ($) ------- ------------- SAVINGS & LOANS - 0.2% Washington Mutual, Inc. 4.200% 01/15/10 700,000 688,128 ------------- Savings & Loans Total 688,128 ------------- FINANCIALS TOTAL 16,956,590 INDUSTRIALS - 2.4% AEROSPACE & DEFENSE - 0.8% Boeing Co. 6.125% 02/15/33 850,000 933,427 L-3 Communications Corp. 6.125% 07/15/13 5,000 5,144 7.625% 06/15/12 170,000 185,300 Lockheed Martin Corp. 8.500% 12/01/29 700,000 965,503 TransDigm, Inc. 8.375% 07/15/11 125,000 133,438 United Technologies Corp. 6.500% 06/01/09 750,000 811,800 ------------- Aerospace & Defense Total 3,034,612 ENVIRONMENTAL CONTROL - 0.2% Allied Waste North America, Inc. 6.375% 04/15/11 75,000 73,125 Synagro Technologies, Inc. 9.500% 04/01/09 50,000 54,750 Waste Management, Inc. 7.375% 08/01/10 700,000 787,150 ------------- Environmental Control Total 915,025 HAND/MACHINE TOOLS - 0.0% Kennametal, Inc. 7.200% 06/15/12 85,000 94,337 ------------- Hand/Machine Tools Total 94,337 MACHINERY DIVERSIFIED - 0.1% Westinghouse Air Brake Technologies Corp. 6.875% 07/31/13 155,000 163,137 ------------- Machinery Diversified Total 163,137 MISCELLANEOUS MANUFACTURING - 0.5% General Electric Co. 5.000% 02/01/13 2,000,000 2,033,000 ------------- Miscellaneous Manufacturing Total 2,033,000 PACKAGING & CONTAINERS - 0.2% Ball Corp. 7.750% 08/01/06 175,000 183,094 Jefferson Smurfit Corp. 8.250% 10/01/12 55,000 59,537 Owens-Illinois, Inc. 7.500% 05/15/10 90,000 95,175 96 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Balanced Fund PAR ($) VALUE ($) ------- ------------- CORPORATE FIXED-INCOME BONDS & NOTES - (CONTINUED) INDUSTRIALS - (CONTINUED) PACKAGING & CONTAINERS - (CONTINUED) Silgan Holdings, Inc. 6.750% 11/15/13 140,000 144,900 Smurfit-Stone Container Corp. 8.375% 07/01/12 25,000 27,063 Stone Container Finance 7.375% 07/15/14 35,000 36,575 ------------- Packaging & Containers Total 546,344 TRANSPORTATION - 0.6% Canadian National Railway Co. 7.195% 01/02/16 891,544 1,046,342 Offshore Logistics, Inc. 6.125% 06/15/13 105,000 105,525 Teekay Shipping Corp. 8.875% 07/15/11 200,000 231,500 Union Pacific Corp. 3.875% 02/15/09 1,000,000 978,630 ------------- Transportation Total 2,361,997 ------------- INDUSTRIALS TOTAL 9,148,452 TECHNOLOGY - 0.3% COMPUTERS - 0.3% International Business Machines Corp. 5.875% 11/29/32 1,000,000 1,066,650 ------------- Computers Total 1,066,650 SEMICONDUCTORS - 0.0% Freescale Semiconductor, Inc. 6.875% 07/15/11 135,000 145,125 ------------- Semiconductors Total 145,125 ------------- TECHNOLOGY TOTAL 1,211,775 UTILITIES - 0.7% ELECTRIC - 0.6% AES Corp. 7.750% 03/01/14 70,000 77,437 CenterPoint Energy Houston Electric LLC 5.750% 01/15/14 750,000 786,735 Exelon Generation Co. LLC 6.950% 06/15/11 625,000 698,644 Nevada Power Co. 5.875% 01/15/15 (c) 15,000 15,262 6.500% 04/15/12 30,000 31,800 NorthWestern Corp. 5.875% 11/01/14 (c) 5,000 5,088 Virginia Electric & Power Co. 5.375% 02/01/07 700,000 717,549 ------------- Electric Total 2,332,515 PAR ($) VALUE ($) ------- ------------- GAS - 0.1% Sempra Energy 4.750% 05/15/09 375,000 377,070 ------------- Gas Total 377,070 ------------- UTILITIES TOTAL 2,709,585 Total Corporate Fixed-Income Bonds & Notes (Cost of $51,086,219) 53,237,776 GOVERNMENT AGENCIES & OBLIGATIONS - 4.3% FOREIGN GOVERNMENT BONDS - 1.0% Province of Ontario 3.500% 09/17/07 1,000,000 989,900 Province of Quebec 6.500% 01/17/06 1,100,000 1,128,270 Republic of Italy 2.500% 03/31/06 1,300,000 1,286,935 United Mexican States 7.500% 04/08/33 250,000 277,000 ------------- FOREIGN GOVERNMENT BONDS TOTAL 3,682,105 U.S. GOVERNMENT AGENCIES & OBLIGATIONS - 3.3% Federal Home Loan Bank 2.250% 09/13/05 1,480,000 1,473,324 3.000% 05/15/06 250,000 248,494 U.S. Treasury Bond 6.250% 08/15/23 570,000 671,710 7.250% 05/15/16 860,000 1,067,441 U.S. Treasury Inflation Index Note 3.625% 01/15/08 4,029,034 4,347,738 U.S. Treasury Note 3.500% 11/15/06 1,415,000 1,414,502 4.250% 11/15/13 3,825,000 3,802,738 ------------- U.S. GOVERNMENT AGENCIES & OBLIGATIONS TOTAL 13,025,947 Total Government Agencies & Obligations (Cost of $16,912,315) 16,708,052 See Accompanying Notes to Financial Statements. | 97 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Balanced Fund PAR ($) VALUE ($) ------- ------------- COLLATERALIZED MORTGAGE OBLIGATIONS - 3.7% COLLATERALIZED MORTGAGE OBLIGATIONS - 2.5% Bear Stearns Asset Backed Securities, Inc. 5.000% 01/25/34 1,992,847 1,980,332 Countrywide Alternative Loan Trust 3.050% 03/25/34 (b) 5,019,623 5,015,263 SACO I, Inc. 12.234% 09/25/24 (d) 22,536 21,409 Structured Asset Securities Corp. 5.500% 05/25/33 1,000,149 987,678 5.500% 07/25/33 1,471,723 1,480,767 ------------- COLLATERALIZED MORTGAGE OBLIGATIONS TOTAL 9,485,449 COMMERCIAL MORTGAGE-BACKED SECURITY - 1.2% Nationslink Funding Corp. 6.888% 11/10/30 4,380,000 4,632,244 ------------- COMMERCIAL MORTGAGE-BACKED SECURITY TOTAL 4,632,244 Total Collateralized Mortgage Obligations (Cost of $13,944,755) 14,117,693 ASSET-BACKED SECURITIES - 1.1% Cityscape Home Equity Loan Trust 7.410% 05/25/28 812,886 812,748 7.940% 10/25/18 (d) 611,069 610,757 First Alliance Mortgage Trust 7.340% 06/20/27 182,870 183,081 IMC Home Equity Loan Trust 7.310% 11/20/28 1,338,774 1,339,925 7.520% 08/20/28 665,720 665,753 Salomon Brothers Mortgage Securities VII 7.150% 06/25/28 787,731 781,500 ------------- Total Asset-Backed Securities (Cost of $4,391,360) 4,393,764 SHORT-TERM OBLIGATIONS - 4.0% U.S. GOVERNMENT OBLIGATION - 1.4% U.S. Treasury Bill 2.480% 05/12/05 (e) 5,335,000 5,308,600 ------------- REPURCHASE AGREEMENT - 2.6% Repurchase agreement with State Street Bank & Trust Co., dated 02/28/05, due 03/01/05 at 2.500%, collateralized by a U.S. Treasury Note maturing 09/30/06, market value of $10,403,257 (repurchase proceeds $10,198,708) 10,198,000 10,198,000 ------------- Total Short-Term Obligations (Cost of $15,506,600) 15,506,600 VALUE ($) ------------- TOTAL INVESTMENTS - 100.2% (COST OF $365,742,813) (f) 385,958,829 OTHER ASSETS & LIABILITIES, NET - (0.2)% (789,590) NET ASSETS - 100.0% 385,169,239 NOTES TO INVESTMENT PORTFOLIO: (a) Non-income producing security. (b) Floating rate note. The interest rate shown reflects the rate as of February 28, 2005. (c) Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. At February 28, 2005, these securities amounted to $1,798,659, which represents 0.5% of net assets. (d) Variable rate security. The interest rate shown reflects the rate as of February 28, 2005. (e) The rate shown represents the annualized yield at the date of purchase. (f) Cost for federal income tax purposes is $366,131,956. At February 28, 2005, the Fund held the following open short futures contracts: NUMBER OF AGGREGATE EXPIRATION UNREALIZED TYPE CONTRACTS VALUE FACE VALUE DATE APPRECIATION -------------------------------------------------------------------------- 2-Year U.S. Treasury Notes 35 $ 7,258,672 $ 7,264,141 Jun-2005 $ 5,469 ---------- On March 7, 2005, cash of $16,000 was pledged as collateral for open futures contracts and was being held by the broker of the futures contracts. At February 28, 2005, the Fund held investments in the following sectors: % OF SECTOR NET ASSETS ---------------------------------------------------------------- Common Stocks 58.8% Mortgage-Backed Obligations 14.5 Corporate Fixed-Income Bonds & Notes 13.8 Government Agencies & Obligations 4.3 Collateralized Mortgage Obligations 3.7 Asset-Backed Securities 1.1 Short-Term Obligations 4.0 Other Assets & Liabilities, Net (0.2) ----- 100.0% ===== ACRONYM NAME ------- ---- ADR American Depositary Receipt 98 | See Accompanying Notes to Financial Statements. INVESTMENT PORTFOLIO ___________________________________________________________ February 28, 2005 (Unaudited) Columbia Short Term Bond Fund PAR ($) VALUE ($) ------- ------------- CORPORATE FIXED-INCOME BONDS & NOTES - 35.7% COMMUNICATIONS - 4.1% MEDIA - 1.6% AOL Time Warner, Inc. 6.125% 04/15/06 2,460,000 2,520,861 Gannett Co., Inc. 4.950% 04/01/05 2,000,000 2,003,360 Jones Intercable, Inc. 7.625% 04/15/08 1,875,000 2,039,831 TCI Communications, Inc. 7.250% 08/01/05 1,125,000 1,142,325 ------------- Media Total 7,706,377 TELECOMMUNICATIONS - 2.5% AT&T Wireless Services, Inc. 7.500% 05/01/07 1,970,000 2,110,520 Deutsche Telekom International Finance 8.500% 06/15/10 1,450,000 1,703,446 GTE Southwest, Inc. 6.000% 01/15/06 3,725,000 3,801,064 Sprint Capital Corp. 6.375% 05/01/09 1,250,000 1,335,463 Verizon Global Funding Corp. 7.600% 03/15/07 600,000 642,894 Vodafone Group PLC 7.750% 02/15/10 2,350,000 2,687,624 ------------- Telecommunications Total 12,281,011 ------------- COMMUNICATIONS TOTAL 19,987,388 CONSUMER CYCLICAL - 3.2% AUTO MANUFACTURERS - 1.8% DaimlerChrysler NA Holding Corp. 4.750% 01/15/08 1,575,000 1,587,442 Ford Motor Credit Co. 7.375% 10/28/09 4,000,000 4,200,040 General Motors Acceptance Corp. 7.750% 01/19/10 2,900,000 3,033,081 ------------- Auto Manufacturers Total 8,820,563 HOUSEWARES - 0.7% Newell Rubbermaid, Inc. 2.000% 05/01/05 3,725,000 3,718,072 ------------- Housewares Total 3,718,072 RETAIL - 0.7% Costco Wholesale Corp. 5.500% 03/15/07 640,000 659,603 Lowe's Companies, Inc. 7.500% 12/15/05 1,675,000 1,723,960 Target Corp. 5.950% 05/15/06 1,000,000 1,025,920 ------------- Retail Total 3,409,483 ------------- CONSUMER CYCLICAL TOTAL 15,948,118 PAR ($) VALUE ($) ------- ------------- CONSUMER NON-CYCLICAL - 4.4% BEVERAGES - 1.3% Bottling Group LLC 2.450% 10/16/06 4,300,000 4,211,979 Coca-Cola Enterprises, Inc. 5.750% 11/01/08 2,275,000 2,390,661 ------------- Beverages Total 6,602,640 COSMETICS/PERSONAL CARE - 0.2% Procter & Gamble Co. 4.750% 06/15/07 725,000 737,999 ------------- Cosmetics/Personal Care Total 737,999 FOOD - 1.5% General Mills, Inc. 2.625% 10/24/06 2,800,000 2,743,384 Kellogg Co. 6.000% 04/01/06 1,250,000 1,280,500 Kroger Co. 7.650% 04/15/07 1,585,000 1,699,295 Safeway, Inc. 4.950% 08/16/10 1,900,000 1,907,315 ------------- Food Total 7,630,494 HEALTHCARE SERVICES - 0.7% UnitedHealth Group, Inc. 3.375% 08/15/07 1,415,000 1,388,016 WellPoint, Inc. 4.875% 08/01/05 2,225,000 2,239,262 ------------- Healthcare Services Total 3,627,278 HOUSEHOLD PRODUCTS/WARES - 0.7% Fortune Brands, Inc. 2.875% 12/01/06 3,275,000 3,219,489 ------------- Household Products/Wares Total 3,219,489 ------------- CONSUMER NON-CYCLICAL TOTAL 21,817,900 ENERGY - 2.1% OIL & GAS - 2.1% ChevronTexaco Capital Co. 3.500% 09/17/07 3,350,000 3,312,982 Devon Energy Corp. 2.750% 08/01/06 2,825,000 2,783,529 Marathon Oil Corp. 5.375% 06/01/07 2,725,000 2,801,028 Occidental Petroleum Corp. 7.650% 02/15/06 1,500,000 1,557,195 ------------- Oil & Gas Total 10,454,734 ------------- ENERGY TOTAL 10,454,734 See Accompanying Notes to Financial Statements. | 99 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Short Term Bond Fund PAR ($) VALUE ($) ------- ------------- CORPORATE FIXED-INCOME BONDS & NOTES - (CONTINUED) FINANCIALS - 15.6% BANKS - 3.5% Marshall & lsley Corp. 4.375% 08/01/09 2,670,000 2,656,223 U.S. Bancorp 3.125% 03/15/08 5,750,000 5,588,138 Wachovia Corp. 3.500% 08/15/08 3,720,000 3,640,094 Wells Fargo & Co. 5.900% 05/21/06 5,200,000 5,333,484 ------------- Banks Total 17,217,939 COMMERCIAL BANKS - 0.4% Fifth Third Bank 2.700% 01/30/07 2,075,000 2,028,250 ------------- Commercial Banks Total 2,028,250 DIVERSIFIED FINANCIAL SERVICES - 9.4% American Express Credit Corp. 3.000% 05/16/08 4,000,000 3,863,040 American General Finance Corp. 3.000% 11/15/06 3,000,000 2,952,660 Bear Stearns Cos., Inc. 6.500% 05/01/06 2,600,000 2,683,980 Capital One Bank 4.875% 05/15/08 1,625,000 1,648,952 CIT Group, Inc. 4.125% 02/21/06 1,700,000 1,708,704 Citigroup, Inc. 6.750% 12/01/05 2,700,000 2,766,555 Countrywide Home Loans, Inc. 2.875% 02/15/07 500,000 488,250 Goldman Sachs Group, Inc. 4.125% 01/15/08 2,560,000 2,562,202 Household Finance Corp. 6.400% 06/17/08 3,225,000 3,432,271 JPMorgan Chase & Co. 3.800% 10/02/09 4,000,000 3,882,840 Lehman Brothers Holdings, Inc. 4.000% 01/22/08 2,500,000 2,487,025 8.750% 03/15/05 500,000 501,030 Merrill Lynch & Co., Inc. 4.125% 01/15/09 2,500,000 2,470,375 Morgan Stanley 3.875% 01/15/09 2,400,000 2,360,496 Pitney Bowes Credit Corp. 5.750% 08/15/08 1,525,000 1,600,899 Security Capital Group, Inc. 7.150% 06/15/07 6,315,000 6,727,180 USA Education, Inc. 5.625% 04/10/07 4,000,000 4,121,880 ------------- Diversified Financial Services Total 46,258,339 PAR ($) VALUE ($) ------- ------------- INSURANCE - 1.0% Allstate Financial Global Funding II 2.625% 10/22/06 (a) 2,950,000 2,892,386 Genworth Financial, Inc. 4.750% 06/15/09 2,010,000 2,034,663 ------------- Insurance Total 4,927,049 INVESTMENT COMPANIES - 0.3% Credit Suisse First Boston USA, Inc. 4.625% 01/15/08 1,630,000 1,650,587 ------------- Investment Companies Total 1,650,587 REAL ESTATE INVESTMENT TRUSTS - 0.4% Health Care Property Investors, Inc. 6.875% 06/08/05 (b) 2,075,000 2,094,339 ------------- Real Estate Investment Trusts Total 2,094,339 SAVINGS & LOANS - 0.6% Washington Mutual, Inc. 4.200% 01/15/10 2,855,000 2,806,579 ------------- Savings & Loans Total 2,806,579 ------------- FINANCIALS TOTAL 76,983,082 INDUSTRIALS - 4.1% AEROSPACE & DEFENSE - 0.9% Boeing Co. 8.100% 11/15/06 1,820,000 1,941,067 United Technologies Corp. 4.875% 11/01/06 2,475,000 2,513,882 ------------- Aerospace & Defense Total 4,454,949 ENVIRONMENTAL CONTROL - 0.5% USA Waste Services, Inc. 7.125% 10/01/07 2,430,000 2,602,967 ------------- Environmental Control Total 2,602,967 MACHINERY - 1.3% Caterpillar Financial Services Corp. 3.625% 11/15/07 3,350,000 3,317,069 John Deere Capital Corp. 3.900% 01/15/08 3,000,000 2,981,310 ------------- Machinery Total 6,298,379 MISCELLANEOUS MANUFACTURING - 0.4% Honeywell International, Inc. 5.125% 11/01/06 1,620,000 1,652,659 ------------- Miscellaneous Manufacturing Total 1,652,659 TRANSPORTATION - 1.0% Canadian National Railway Co. 6.450% 07/15/06 (b) 910,000 940,330 CSX Corp. 6.460% 06/22/05 2,250,000 2,272,793 100 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Short Term Bond Fund PAR ($) VALUE ($) ------- ------------- CORPORATE FIXED-INCOME BONDS & NOTES - (CONTINUED) INDUSTRIALS - (CONTINUED) TRANSPORTATION - (CONTINUED) Union Pacific Corp. 3.875% 02/15/09 1,825,000 1,786,000 ------------- Transportation Total 4,999,123 ------------- INDUSTRIALS TOTAL 20,008,077 TECHNOLOGY - 0.5% COMPUTERS - 0.5% International Business Machines Corp. 2.375% 11/01/06 2,700,000 2,641,653 ------------- Computers Total 2,641,653 ------------- TECHNOLOGY TOTAL 2,641,653 UTILITIES - 1.7% ELECTRIC - 0.9% Exelon Generation Co. 6.950% 06/15/11 1,850,000 2,067,986 Virginia Electric & Power Co. 5.375% 02/01/07 2,400,000 2,460,168 ------------- Electric Total 4,528,154 GAS - 0.8% Kinder Morgan Energy Partners LP 8.000% 03/15/05 2,415,000 2,419,057 Sempra Energy 4.750% 05/15/09 1,150,000 1,156,348 ------------- Gas Total 3,575,405 ------------- UTILITIES TOTAL 8,103,559 Total Corporate Fixed-Income Bonds & Notes (Cost of $177,937,276) 175,944,511 MORTGAGE-BACKED OBLIGATIONS - 20.9% Federal Home Loan Mortgage Corp. 3.000% 06/15/09 2,891,619 2,885,294 4.000% 05/01/11-10/15/26 17,613,710 17,449,657 4.500% 05/01/19-01/01/20 37,152,476 36,732,906 5.000% 09/01/19-05/01/34 7,095,805 7,118,196 5.500% 05/01/17-07/01/19 6,964,247 7,146,381 6.000% 10/01/06-06/15/31 1,965,352 2,015,688 7.000% 05/01/19-06/15/22 218,988 218,845 7.500% 09/01/15 199,060 210,249 8.500% 09/15/06-07/01/30 195,036 209,400 PAR ($) VALUE ($) ------- ------------- Federal National Mortgage Association (c) 05/25/23 1,295,000 1,008,205 3.080% 09/25/18 (d) 2,985,807 2,989,033 4.500% 01/01/20 1,216,226 1,202,491 5.000% 04/25/31 6,273,640 6,296,482 5.500% 02/01/18 3,523,903 3,612,341 6.000% 03/01/09-12/18/27 2,300,796 2,369,140 6.500% 03/01/12-07/01/32 120,218 126,151 7.500% 08/01/15 148,191 156,728 8.000% 10/25/06 11,220 11,486 8.000% 05/01/15-07/01/31 427,076 457,053 Government National Mortgage Association 3.500% 12/20/26 8,964,363 8,919,789 5.000% 05/16/27 759,159 764,264 6.500% 09/15/13-11/15/33 900,511 947,472 7.000% 11/15/13-08/15/29 339,623 360,232 ------------- Total Mortgage-Backed Obligations (Cost of $103,838,878) 103,207,483 COLLATERALIZED MORTGAGE OBLIGATIONS - 17.4% COLLATERALIZED MORTGAGE OBLIGATIONS - 16.8% Bank of America Mortgage Securities 5.250% 02/25/18 (e) 1,865,245 1,851,535 Bear Stearns Adjustable Rate Mortgage Trust 3.515% 06/25/34 (b) 3,583,400 3,646,504 Bear Stearns Alternative Trust 3.000% 09/25/34 (d) 2,912,962 2,913,002 Bear Stearns Asset-Backed Securities, Inc. 7.000% 08/25/36 (a) 682,688 682,688 Countrywide Alternative Loan Trust 3.050% 08/25/18 (d) 9,923,147 9,870,456 Countrywide Home Loans Mortgage Pass Through Trust 3.050% 03/25/34 (d) 1,465,097 1,463,825 3.150% 03/25/34 (d) 7,244,061 7,252,247 5.000% 01/25/18 875,476 873,637 5.750% 01/25/33 23,131 23,067 First Alliance Mortgage Loan Trust 6.680% 06/25/25 241,034 240,673 GMAC Mortgage Corporation Loan Trust 3.150% 05/25/18 (d) 4,510,699 4,510,699 Ocwen Residential MBS Corp. 7.000% 10/25/40 (a) 130,643 131,848 PNC Mortgage Securities Corp. 0.010% 04/28/27 (b) 13,303 12,238 Residential Accredit Loans, Inc. 3.250% 07/25/32 (d) 163,416 163,610 3.050% 06/25/34 (d) 9,566,338 9,566,338 Residential Asset Securitization Trust 3.100% 02/25/34 (d) 10,376,799 10,375,761 6.000% 01/25/33 30,261 30,238 See Accompanying Notes to Financial Statements. | 101 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Short Term Bond Fund PAR ($) VALUE ($) ------- ------------- COLLATERALIZED MORTGAGE OBLIGATIONS - (CONTINUED) COLLATERALIZED MORTGAGE OBLIGATIONS - (CONTINUED) Residential Funding Mortgage Securities I, Inc. 3.050% 07/25/18 (d) 9,222,791 9,193,093 Sears Corp. 8.500% 04/01/17 102,314 102,314 Small Business Administration 2.875% 06/25/22 (d) 529,234 531,532 Structured Asset Securities Corp. 5.500% 05/25/33 500,075 493,839 5.500% 07/25/33 352,758 354,926 5.750% 04/25/33 4,150,933 4,161,423 6.000% 09/25/32 249,311 246,937 Washington Mutual Mortgage Securities Corp. 3.150% 03/25/18 (d) 4,037,414 4,058,651 3.150% 06/25/18 (d) 3,513,238 3,532,034 Wells Fargo Mortgage-Backed Securities Trust 5.250% 08/25/33 6,454,355 6,508,442 ------------- COLLATERALIZED MORTGAGE OBLIGATIONS TOTAL 82,791,557 COMMERICIAL MORTGAGE-BACKED SECURITIES - 0.6% Nationslink Funding Corp. 6.888% 11/10/30 2,630,000 2,781,462 ------------- COMMERICIAL MORTGAGE-BACKED SECURITIES TOTAL 2,781,462 Total Collateralized Mortgage Obligations (Cost of $85,585,852) 85,573,019 ASSET-BACKED SECURITIES - 11.3% ABFS Mortgage Loan Trust 4.428% 12/15/33 141,017 133,656 Advanta Mortgage Loan Trust 7.750% 10/25/26 68,744 69,670 AmeriCredit Automobile Receivables Trust 5.370% 06/12/08 469,056 473,691 Amresco Residential Securities Mortgage Loan Trust 2.890% 07/25/28 (d) 194,349 195,443 3.070% 06/25/27 (d) 49,605 49,614 CIT Equipment Collateral 2.200% 03/20/08 3,050,000 3,003,818 Cityscape Home Equity Loan Trust 7.380% 07/25/28 182,440 182,391 7.410% 05/25/28 91,336 91,320 First Horizon Mortgage Pass-Through Trust 3.100% 06/25/18 (d) 2,262,896 2,272,354 3.150% 03/25/18 (d) 6,744,933 6,779,535 Harley Davidson Motorcycle Trust 3.090% 06/15/10 1,366,836 1,352,676 PAR ($) VALUE ($) ------- ------------- Honda Auto Receivables Owner Trust 3.000% 05/18/06 497,090 497,190 IMC Home Equity Loan Trust 7.080% 08/20/28 123,841 123,762 7.310% 11/20/28 101,329 101,416 7.500% 04/25/26 770,796 789,520 7.520% 08/20/28 524,587 524,614 Keycorp Student Loan Trust 3.010% 10/25/25 (d) 12,080,000 12,171,929 3.549% 01/27/23 (a)(d) 3,451,101 3,475,880 Morgan Stanley Dean Witter 3.070% 11/25/32 (d) 545,731 553,988 Nissan Auto Receivables Owner Trust 4.600% 09/17/07 1,779,623 1,788,592 Novastar Home Equity Loan 3.020% 02/25/34 (d) 1,572,020 1,576,107 Residential Asset Mortgage Products 2.990% 09/25/33 (d) 2,046,456 2,054,171 Residential Funding Mortgage Securities 1, Inc. 2.940% 08/25/33 (d) 149,461 149,706 SLM Student Loan Trust 3.269% 01/25/10 (d) 960,523 961,679 3.599% 07/25/11 (d) 6,030,000 6,033,437 3.719% 01/25/13 (d) 8,950,000 9,241,360 University Support Services, Inc. 2.879% 09/20/15 (d) 1,205,423 1,216,320 ------------- Total Asset-Backed Securities (Cost of $55,622,238) 55,863,839 GOVERNMENT AGENCIES & OBLIGATIONS - 8.4% FOREIGN GOVERNMENT BONDS - 2.3% Canadian Government Bond 6.750% 08/28/06 1,000,000 1,046,130 Province of Ontario 3.500% 09/17/07 3,500,000 3,464,650 Province of Quebec 6.500% 01/17/06 1,100,000 1,128,270 Republic of Italy 2.500% 03/31/06 1,950,000 1,930,402 United Mexican States 4.625% 10/08/08 3,600,000 3,618,000 ------------- FOREIGN GOVERNMENT BONDS TOTAL 11,187,452 U.S. GOVERNMENT AGENCIES & OBLIGATIONS - 6.1% A.I.D. Morocco 3.156% 05/01/23 (d) 462,500 455,563 Federal Home Loan Bank 2.250% 09/13/05 5,300,000 5,276,092 3.000% 05/15/06 (f) 500,000 496,987 U.S. Treasury Bond 6.250% 08/15/23 30,000 35,353 102 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Short Term Bond Fund PAR ($) VALUE ($) ------- ------------- GOVERNMENT AGENCIES & OBLIGATIONS - (CONTINUED) U.S. GOVERNMENT AGENCIES & OBLIGATIONS - (CONTINUED) U.S. Treasury Inflation Index Note 3.625% 01/15/08 14,248,878 15,375,992 U.S. Treasury Note 3.500% 11/15/06 8,740,000 8,736,924 ------------- U.S. GOVERNMENT AGENCIES & OBLIGATIONS TOTAL 30,376,911 Total Government Agencies & Obligations (Cost of $41,910,566) 41,564,363 SHORT-TERM OBLIGATIONS - 5.8% U.S. GOVERNMENT OBLIGATION - 2.1% U.S. Treasury Bill 2.480% 051/2/05 (g) 10,205,000 10,154,638 ------------- REPURCHASE AGREEMENT - 3.7% Repurchase agreement with State Street Bank & Trust Co., dated 02/28/05, due 03/01/05 at 2.500%, collateralized by a U.S. Treasury Note maturing 09/30/05, market value of $18,770,662 (repurchase proceeds $18,402,278) 18,401,000 18,401,000 ------------- Total Short-Term Obligations (Cost of $28,555,638) 28,555,638 TOTAL INVESTMENTS - 99.5% (COST OF $493,450,448) (h) 490,708,853 OTHER ASSETS & LIABILITIES, NET - 0.5% 2,443,125 NET ASSETS - 100.0% 493,151,978 NOTES TO INVESTMENT PORTFOLIO: (a) Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. At February 28, 2005, these securities amounted to $7,182,802, which represents 1.5% of net assets. (b) Variable rate security. The interest rate shown reflects the rate at February 28, 2005. (c) Zero coupon bond. (d) Floating rate security. The interest rate shown reflects the rate as of February 28, 2005. (e) Investments in affiliates during the period ended February 28, 2005. Security name: Bank of America Mortgage Securities (as a result of a merger effective April 1, 2004, Bank of America Corp. became the parent company of the Investment Advisor.) Par as of 08/31/04: $ 2,252,966 Par purchased: $ -- Par sold: $ 387,721 Par as of 02/28/05: $ 1,865,245 Net realized gain or loss: $ -- Interest income earned: $ 45,118 Value at end of period: $ 1,851,535 (f) Security pledged as collateral for open futures contracts. (g) The rate shown represents the annualized yield at the date of purchase. (h) Cost for federal income tax purposes is $493,293,337. At February 28, 2005, the Fund held the following open short futures contracts: NUMBER OF AGGREGATE EXPIRATION UNREALIZED TYPE CONTRACTS VALUE FACE VALUE DATE APPRECIATION -------------------------------------------------------------------------- 2-Year U.S. Treasury Notes 245 $50,810,703 $50,848,984 Jun-2005 $ 38,281 ---------- At February 28, 2005, the Fund held investments in the following sectors: % OF SECTOR NET ASSETS ---------------------------------------------------------------- Corporate Fixed-Income Bonds & Notes 35.7% Mortgage-Backed Obligations 20.9 Collateralized Mortgage Obligations 17.4 Asset-Backed Securities 11.3 Government Agencies & Obligations 8.4 Short-Term Obligations 5.8 Other Assets & Liabilities, Net 0.5 ----- 100.0% ===== See Accompanying Notes to Financial Statements. | 103 INVESTMENT PORTFOLIO ___________________________________________________________ February 28, 2005 (Unaudited) Columbia Fixed Income Securities Fund PAR ($) VALUE ($) ------- ------------- MORTGAGE-BACKED OBLIGATIONS - 38.8% Federal Home Loan Mortgage Corp. 3.500% 10/01/18 4,771,400 4,474,715 4.000% 09/15/15-10/15/26 23,795,000 22,951,722 4.500% 10/15/18-08/15/28 37,073,163 36,734,385 5.000% 05/01/34 2,508,998 2,478,575 5.500% 12/01/18-09/01/34 9,217,753 9,382,150 6.000% 05/01/17-08/01/34 8,971,314 9,222,269 6.500% 10/15/23-08/01/32 2,598,365 2,686,958 Federal Housing Administration 8.500% 05/01/23 2,088,216 2,109,098 Federal National Mortgage Association 4.500% 11/25/14 2,050,000 2,053,273 5.000% 06/01/18-08/01/18 9,366,213 9,442,801 5.500% 12/01/17 394,744 405,072 5.948% 06/01/32 (a) 71,278 72,501 6.000% 03/01/09 822,526 836,458 6.089% 07/01/32 (a) 903,191 911,911 6.500% 07/25/30-07/01/32 465,568 469,643 Government National Mortgage Association 4.500% 04/16/28 2,090,000 2,082,481 5.000% 05/15/33-02/15/35 2,629,800 2,620,813 6.000% 05/15/33 1,000,600 1,033,967 ------------- Total Mortgage-Backed Obligations (Cost of $109,858,917) 109,968,792 CORPORATE FIXED-INCOME BONDS & NOTES - 36.5% BASIC MATERIALS - 0.9% CHEMICALS - 0.2% Airgas, Inc. 9.125% 10/01/11 140,000 155,050 EquiStar Chemicals LP 10.125% 09/01/08 25,000 28,813 10.625% 05/01/11 100,000 115,750 Ethyl Corp. 8.875% 05/01/10 50,000 55,000 MacDermid, Inc. 9.125% 07/15/11 115,000 127,219 Nalco Co. 7.750% 11/15/11 75,000 81,187 ------------- Chemicals Total 563,019 FOREST PRODUCTS & PAPER - 0.3% Boise Cascade LLC 7.125% 10/15/14 (b) 200,000 213,000 International Paper Co. 4.250% 01/15/09 510,000 507,093 ------------- Forest Products & Paper Total 720,093 IRON/STEEL - 0.0% Russel Metals, Inc. 6.375% 03/01/14 135,000 136,688 Iron/Steel Total 136,688 PAR ($) VALUE ($) ------- ------------- METALS & MINING - 0.4% Alcan, Inc. 7.250% 03/15/31 1,000,000 1,225,020 ------------- Metals & Mining Total 1,225,020 ------------- BASIC MATERIALS TOTAL 2,644,820 COMMUNICATIONS - 4.8% MEDIA - 1.7% Comcast Corp. 7.050% 03/15/33 870,000 1,011,958 Dex Media West LLC 5.875% 11/15/11 (b) 170,000 169,150 DirecTV Holdings 8.375% 03/15/13 245,000 276,544 EchoStar DBS Corp. 5.750% 10/01/08 320,000 324,800 6.625% 10/01/14 (b) 105,000 108,019 Emmis Operating Co. 6.875% 05/15/12 75,000 76,500 Lamar Media Corp. 7.250% 01/01/13 225,000 243,000 LIN Television Corp. 6.500% 05/15/13 200,000 204,500 R.H. Donnelley Finance Corp. 10.875% 12/15/12 75,000 88,125 10.875% 12/15/12 (b) 160,000 188,000 Rogers Cable, Inc. 7.875% 05/01/12 255,000 282,412 TCI Communications, Inc. 7.250% 08/01/05 500,000 507,700 Time Warner, Inc. 6.625% 05/15/29 1,310,000 1,426,472 ------------- Media Total 4,907,180 TELECOMMUNICATIONS - 3.1% AT&T Wireless Services, Inc. 8.750% 03/01/31 1,200,000 1,634,148 Deutsche Telekom International Finance BV 8.500% 06/15/10 1,390,000 1,632,958 Nextel Communications, Inc. 6.875% 10/31/13 40,000 43,200 7.375% 08/01/15 350,000 383,250 Rogers Wireless, Inc. 7.500% 03/15/15 30,000 32,850 8.000% 12/15/12 140,000 151,900 Sprint Capital Corp. 6.875% 11/15/28 950,000 1,053,313 Verizon Global Funding Corp. 7.750% 12/01/30 1,700,000 2,111,485 Vodafone Group PLC 7.750% 02/15/10 1,500,000 1,715,505 ------------- Telecommunications Total 8,758,609 ------------- COMMUNICATIONS TOTAL 13,665,789 104 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Fixed Income Securities Fund PAR ($) VALUE ($) ------- ------------- CORPORATE FIXED-INCOME BONDS & NOTES - (CONTINUED) CONSUMER CYCLICAL - 4.4% AUTO MANUFACTURERS - 1.7% DaimlerChrysler NA Holding Corp. 8.500% 01/18/31 675,000 860,416 Ford Motor Credit Co. 7.375% 10/28/09 2,375,000 2,493,774 General Motors Acceptance Corp. 7.750% 01/19/10 1,385,000 1,448,557 ------------- Auto Manufacturers Total 4,802,747 ENTERTAINMENT - 0.2% Cinemark USA, Inc. 9.000% 02/01/13 185,000 206,506 Speedway Motorsports, Inc. 6.750% 06/01/13 190,000 199,263 Warner Music Group 7.375% 04/15/14 (b) 110,000 116,600 ------------- Entertainment Total 522,369 HOME BUILDERS - 0.3% KB Home 8.625% 12/15/08 350,000 396,375 Toll Corp. 8.250% 12/01/11 350,000 385,437 ------------- Home Builders Total 781,812 LEISURE TIME - 0.2% K2, Inc. 7.375% 07/01/14 125,000 135,250 Royal Caribbean Cruises Ltd. 6.750% 03/15/08 80,000 85,200 6.875% 12/01/13 100,000 109,250 8.750% 02/02/11 155,000 181,738 ------------- Leisure Time Total 511,438 LODGING - 0.5% ITT Corp. 6.750% 11/15/05 70,000 71,487 Kerzner International, Ltd. 8.875% 08/15/11 150,000 163,500 MGM Mirage, Inc. 6.000% 10/01/09 285,000 292,125 9.750% 06/01/07 15,000 16,613 Park Place Entertainment Corp. 8.875% 09/15/08 25,000 28,313 9.375% 02/15/07 160,000 174,800 Starwood Hotels & Resorts Worldwide, Inc. 7.875% 05/01/12 105,000 121,669 Station Casinos, Inc. 6.875% 03/01/16 375,000 395,625 Wynn Las Vegas LLC 6.625% 12/01/14 (b) 145,000 145,362 ------------- Lodging Total 1,409,494 PAR ($) VALUE ($) ------- ------------- RETAIL - 1.5% AutoNation, Inc. 9.000% 08/01/08 200,000 226,000 Costco Wholesale Corp. 5.500% 03/15/07 1,900,000 1,958,197 Couche-Tard 7.500% 12/15/13 170,000 182,325 Domino's, Inc. 8.250% 07/01/11 50,000 54,063 Group 1 Automotive, Inc. 8.250% 08/15/13 80,000 84,400 Lowe's Companies, Inc. 6.500% 03/15/29 1,510,000 1,730,370 Suburban Propane Partners 6.875% 12/15/13 100,000 102,500 ------------- Retail Total 4,337,855 ------------- CONSUMER CYCLICAL TOTAL 12,365,715 CONSUMER NON-CYCLICAL - 4.3% BEVERAGES - 0.5% Anheuser-Busch Companies, Inc. 5.750% 04/01/10 530,000 560,724 Constellation Brands, Inc. 8.000% 02/15/08 350,000 380,625 Cott Beverages, Inc. 8.000% 12/15/11 345,000 373,463 ------------- Beverages Total 1,314,812 COMMERCIAL SERVICES - 0.3% Corrections Corp. of America 7.500% 05/01/11 275,000 292,531 Iron Mountain, Inc. 8.625% 04/01/13 255,000 269,025 United Rentals NA, Inc. 7.750% 11/15/13 190,000 190,950 ------------- Commercial Services Total 752,506 FOOD - 2.0% General Mills, Inc. 2.625% 10/24/06 915,000 896,499 Kroger Co. 7.650% 04/15/07 1,450,000 1,554,559 Pepsi Bottling Holdings, Inc. 5.625% 02/17/09 (b) 2,050,000 2,150,778 Safeway, Inc. 4.950% 08/16/10 1,145,000 1,149,408 ------------- Food Total 5,751,244 HEALTHCARE SERVICES - 1.3% Extendicare Health Services 6.875% 05/01/14 65,000 66,300 9.500% 07/01/10 15,000 16,613 Fisher Scientific International 6.750% 08/15/14 (b) 115,000 122,044 See Accompanying Notes to Financial Statements. | 105 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Fixed Income Securities Fund PAR ($) VALUE ($) ------- ------------- CORPORATE FIXED-INCOME BONDS & NOTES - (CONTINUED) CONSUMER NON-CYCLICAL - (CONTINUED) HEALTHCARE SERVICES - (CONTINUED) HCA, Inc. 6.950% 05/01/12 235,000 248,421 Province Healthcare Co. 7.500% 06/01/13 250,000 279,687 Triad Hospitals, Inc. 7.000% 05/15/12 250,000 266,250 7.000% 11/15/13 15,000 15,563 UnitedHealth Group, Inc. 3.375% 08/15/07 1,000,000 980,930 WellPoint, Inc. 6.800% 08/01/12 1,550,000 1,736,542 ------------- Healthcare Services Total 3,732,350 HOUSEHOLD PRODUCTS/WARES - 0.1% Scotts Co. 6.625% 11/15/13 175,000 184,844 ------------- Household Products/Wares Total 184,844 PHARMACEUTICALS - 0.1% AmerisourceBergen Corp. 8.125% 09/01/08 115,000 127,650 Omnicare, Inc. 8.125% 03/15/11 290,000 308,850 ------------- Pharmaceuticals Total 436,500 ------------- CONSUMER NON-CYCLICAL TOTAL 12,172,256 ENERGY - 3.1% COAL - 0.2% Arch Western Finance 6.750% 07/01/13 210,000 217,875 Peabody Energy Corp. 6.875% 03/15/13 340,000 368,900 ------------- Coal Total 586,775 OIL & GAS - 2.0% Chesapeake Energy Corp. 6.375% 06/15/15 (b) 65,000 68,575 7.500% 09/15/13 320,000 352,800 Devon Energy Corp. 7.950% 04/15/32 1,150,000 1,491,906 Marathon Oil Corp. 6.800% 03/15/32 1,000,000 1,138,970 Newfield Exploration Co. 6.625% 09/01/14 (b) 240,000 258,300 Occidental Petroleum Corp. 4.250% 03/15/10 1,825,000 1,802,954 Plains Exploration & Production Co. 7.125% 06/15/14 170,000 187,000 Pride International, Inc. 7.375% 07/15/14 205,000 226,525 PAR ($) VALUE ($) ------- ------------- Vintage Petroleum, Inc. 7.875% 05/15/11 150,000 160,875 8.250% 05/01/12 25,000 27,563 ------------- Oil & Gas Total 5,715,468 OIL & GAS SERVICES - 0.3% Grant Prideco, Inc. 9.000% 12/15/09 360,000 396,900 9.625% 12/01/07 40,000 44,500 Hornbeck Offshore Services, Inc. 6.125% 12/01/14 (b) 100,000 100,250 Universal Compression, Inc. 7.250% 05/15/10 190,000 199,500 ------------- Oil & Gas Services Total 741,150 PIPELINES - 0.6% Kinder Morgan Energy Partners LP 6.875% 11/01/14 (b) 90,000 92,475 7.300% 08/15/33 1,200,000 1,430,676 Williams Companies, Inc. 7.125% 09/01/11 30,000 33,000 8.125% 03/15/12 195,000 227,175 ------------- Pipelines Total 1,783,326 ------------- ENERGY TOTAL 8,826,719 FINANCIALS - 11.5% BANKS - 2.6% US Bank NA 6.375% 08/01/11 2,350,000 2,587,890 Wachovia Corp. 4.875% 02/15/14 2,145,000 2,127,819 Wells Fargo & Co. 5.900% 05/21/06 2,600,000 2,666,742 ------------- Banks Total 7,382,451 DIVERSIFIED FINANCIAL SERVICES - 6.8% American General Finance Corp. 5.375% 09/01/09 850,000 878,535 Capital One Bank 4.875% 05/15/08 1,025,000 1,040,109 CIT Group, Inc. 4.125% 02/21/06 1,060,000 1,065,427 Citigroup, Inc. 5.000% 09/15/14 2,655,000 2,657,602 Countrywide Home Loans, Inc. 2.875% 02/15/07 1,000,000 976,500 Goldman Sachs Group, Inc. 6.345% 02/15/34 1,550,000 1,650,130 Household Finance Corp. 6.400% 06/17/08 1,850,000 1,968,899 JPMorgan Chase & Co. 5.750% 01/02/13 2,545,000 2,677,900 Lehman Brothers Holdings, Inc. 4.000% 01/22/08 1,000,000 994,810 106 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Fixed Income Securities Fund PAR ($) VALUE ($) ------- ------------- CORPORATE FIXED-INCOME BONDS & NOTES - (CONTINUED) FINANCIALS - (CONTINUED) DIVERSIFIED FINANCIAL SERVICES - (CONTINUED) Merrill Lynch & Co., Inc. 4.125% 01/15/09 1,885,000 1,862,663 Morgan Stanley 4.750% 04/01/14 1,530,000 1,498,298 SLM Corp. 5.125% 08/27/12 2,000,000 2,037,080 ------------- Diversified Financial Services Total 19,307,953 INSURANCE - 1.4% Allstate Financial Global Funding II 2.625% 10/22/06 (b) 2,500,000 2,451,175 Genworth Financial, Inc. 4.750% 06/15/09 1,500,000 1,518,405 ------------- Insurance Total 3,969,580 REAL ESTATE INVESTMENT TRUSTS - 0.7% Health Care Property Investors, Inc., 6.450% 06/25/12 1,410,000 1,534,094 iStar Financial, Inc., 5.125% 04/01/11 175,000 174,849 7.000% 03/15/08 150,000 159,246 ------------- Real Estate Investment Trusts Total 1,868,189 ------------- FINANCIALS TOTAL 32,528,173 INDUSTRIALS - 5.3% AEROSPACE & DEFENSE - 1.8% Boeing Co. 6.125% 02/15/33 1,475,000 1,619,771 L-3 Communications Corp. 6.125% 07/15/13 5,000 5,144 7.625% 06/15/12 330,000 359,700 Lockheed Martin Corp. 8.500% 12/01/29 675,000 931,021 TransDigm, Inc. 8.375% 07/15/11 175,000 186,812 United Technologies Corp. 7.125% 11/15/10 1,900,000 2,139,172 ------------- Aerospace & Defense Total 5,241,620 ENVIRONMENTAL CONTROL - 0.6% Allied Waste North America, Inc. 6.375% 04/15/11 180,000 175,500 Synagro Technologies, Inc. 9.500% 04/01/09 100,000 109,500 Waste Management, Inc. 7.375% 08/01/10 1,330,000 1,495,585 ------------- Environmental Control Total 1,780,585 PAR ($) VALUE ($) ------- ------------- HAND/MACHINE TOOLS - 0.1% Kennametal, Inc. 7.200% 06/15/12 165,000 183,125 ------------- Hand/Machine Tools Total 183,125 MACHINERY DIVERSIFIED - 0.1% Manitowoc Co., Inc. 7.125% 11/01/13 10,000 10,800 Westinghouse Air Brake Technologies Corp. 6.875% 07/31/13 200,000 210,500 ------------- Machinery Diversified Total 221,300 MISCELLANEOUS MANUFACTURING - 1.0% General Electric Co. 5.000% 02/01/13 2,875,000 2,922,438 ------------- Miscellaneous Manufacturing Total 2,922,438 PACKAGING & CONTAINERS - 0.4% Ball Corp. 7.750% 08/01/06 375,000 392,344 Owens-Brockway Glass Container 6.750% 12/01/14 (b) 25,000 25,625 Owens-Illinois, Inc. 7.500% 05/15/10 185,000 195,637 Silgan Holdings, Inc. 6.750% 11/15/13 285,000 294,975 Smurfit-Stone Container Corp. 9.750% 02/01/11 140,000 152,600 Stone Container Finance 7.375% 07/15/14 95,000 99,275 ------------- Packaging & Containers Total 1,160,456 TRANSPORTATION - 1.3% Canadian National Railway Co. 7.195% 01/02/16 1,906,913 2,238,010 Offshore Logistics, Inc. 6.125% 06/15/13 205,000 206,025 Teekay Shipping Corp. 8.875% 07/15/11 325,000 376,187 Union Pacific Corp. 3.875% 02/15/09 790,000 773,118 ------------- Transportation Total 3,593,340 ------------- INDUSTRIALS TOTAL 15,102,864 TECHNOLOGY - 0.5% COMPUTERS - 0.4% International Business Machines Corp. 5.875% 11/29/32 1,000,000 1,066,650 ------------- Computers Total 1,066,650 See Accompanying Notes to Financial Statements. | 107 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Fixed Income Securities Fund PAR ($) VALUE ($) ------- ------------- CORPORATE FIXED-INCOME BONDS & NOTES - (CONTINUED) TECHNOLOGY - (CONTINUED) SEMICONDUCTORS - 0.1% Freescale Semiconductor, Inc. 6.875% 07/15/11 175,000 188,125 ------------- Semiconductors Total 188,125 ------------- TECHNOLOGY TOTAL 1,254,775 UTILITIES - 1.7% ELECTRIC - 1.4% AES Corp. 7.750% 03/01/14 110,000 121,687 CenterPoint Energy Houston Electric LLC 5.750% 01/15/14 1,400,000 1,468,572 Exelon Generation Co. LLC 6.950% 06/15/11 1,300,000 1,453,179 Hydro-Quebec 6.970% 03/01/05 1,000,000 1,000,300 Nevada Power Co. 5.875% 01/15/15 (b) 50,000 50,875 6.500% 04/15/12 40,000 42,400 NorthWestern Corp. 5.875% 11/01/14 (b) 10,000 10,175 ------------- Electric Total 4,147,188 GAS - 0.3% Sempra Energy 4.750% 05/15/09 750,000 754,140 ------------- Gas Total 754,140 ------------- UTILITIES TOTAL 4,901,328 Total Corporate Fixed-Income Bonds & Notes (Cost of $100,041,478) 103,462,439 GOVERNMENT AGENCIES & OBLIGATIONS - 9.8% FOREIGN GOVERNMENT BONDS - 2.3% Province of Quebec 7.000% 01/30/07 1,490,000 1,576,702 Republic of Italy 2.500% 03/31/06 2,750,000 2,722,363 United Mexican States 7.500% 04/08/33 1,890,000 2,094,120 ------------- FOREIGN GOVERNMENT BONDS TOTAL 6,393,185 U.S. GOVERNMENT AGENCIES & OBLIGATIONS - 7.5% Federal Home Loan Bank 2.250% 09/13/05 3,060,000 3,046,196 3.000% 05/15/06 (c) 350,000 347,891 U.S. Treasury Bond 6.250% 08/15/23 3,000,000 3,535,314 PAR ($) VALUE ($) ------- ------------- U.S. Treasury Inflation Index Note 3.625% 01/15/08 7,763,547 8,377,659 U.S. Treasury Note 3.500% 11/15/06 4,555,000 4,553,397 4.250% 11/15/13 1,500,000 1,491,270 ------------- U.S. GOVERNMENT AGENCIES & OBLIGATIONS TOTAL 21,351,727 Total Government Agencies & Obligations (Cost of $27,720,588) 27,744,912 COLLATERALIZED MORTGAGE OBLIGATIONS - 7.0% COLLATERALIZED MORTGAGE OBLIGATIONS - 5.8% Bear Stearns Asset-Backed Securities, Inc. 5.000% 01/25/34 4,937,454 4,906,447 Countrywide Alternative Loan Trust 3.050% 03/25/34 (a) 3,604,472 3,601,341 Countrywide Home Loan Mortgage Pass Through Trust 4.612% 12/19/33 (a) 3,902,860 3,804,860 IMPAC Secured Assets Corp. 6.360% 08/25/32 142,773 142,643 Structured Asset Securities Corp. 5.500% 07/25/33 4,035,860 4,060,661 ------------- COLLATERALIZED MORTGAGE OBLIGATIONS TOTAL 16,515,952 COMMERCIAL MORTGAGE-BACKED SECURITIES - 1.2% Nationslink Funding Corp. 6.888% 11/10/30 3,120,000 3,299,681 ------------- COMMERCIAL MORTGAGE-BACKED SECURITIES TOTAL 3,299,681 Total Collateralized Mortgage Obligations (Cost of $19,941,682) 19,815,633 ASSET-BACKED SECURITIES - 3.3% Cityscape Home Equity Loan Trust 7.940% 10/25/18 (a) 415,527 415,315 ContiMortgage Home Equity Trust 7.680% 12/25/29 1,370,707 1,390,418 Fannie Mae Whole Loan 7.800% 06/25/26 463,929 489,271 IMC Home Equity Loan Trust 7.310% 11/20/28 3,611,005 3,614,111 7.500% 04/25/26 1,137,240 1,164,866 7.520% 08/20/28 1,459,258 1,459,331 New Century Home Equity Loan Trust 7.320% 07/25/29 200,104 204,271 Salomon Brothers Mortgage Securities VII, Inc. 7.150% 06/25/28 490,144 486,266 ------------- Total Asset-Backed Securities (Cost of $9,147,562) 9,223,849 108 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Fixed Income Securities Fund PAR ($) VALUE ($) ------- ------------- SHORT-TERM OBLIGATIONS - 4.0% U.S. GOVERNMENT OBLIGATION - 2.1% U.S. Treasury Bill 2.480% 05/12/05 (d) 5,880,000 5,850,836 ------------- REPURCHASE AGREEMENT - 1.9% Repurchase agreement with State Street Bank & Trust Co., dated 02/28/05, due 03/01/05 at 2.500%, collateralized by a U.S. Treasury Note maturing 09/30/06, market value of $5,505,264 (repurchase proceeds $5,397,375) 5,397,000 5,397,000 ------------- Total Short-Term Obligations (Cost of $11,247,836) 11,247,836 TOTAL INVESTMENTS - 99.4% (COST OF $277,958,063) (e) 281,463,461 OTHER ASSETS & LIABILITIES, NET - 0.6% 1,591,111 NET ASSETS - 100.0% 283,054,572 NOTES TO INVESTMENT PORTFOLIO: (a) Floating rate security. The interest rate shown reflects the rate as of February 28, 2005. (b) Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. At February 28, 2005, these securities amounted to $6,270,403, which represents 2.2% of net assets. (c) Security pledged as collateral for open futures contracts. (d) The rate shown represents the annualized yield at the date of purchase. (e) Cost for federal income tax purposes is $278,841,750. At February 28, 2005, the Fund held the following open short futures contracts: NUMBER OF AGGREGATE EXPIRATION UNREALIZED TYPE CONTRACTS VALUE FACE VALUE DATE APPRECIATION -------------------------------------------------------------------------- 2-Year U.S. Treasury Notes 65 $13,480,391 $13,490,547 Jun-2005 $10,156 ---------- At February 28, 2005, the Fund held investments in the following sectors: % OF SECTOR NET ASSETS ---------------------------------------------------------------- Mortgage-Backed Obligations 38.8% Corporate Fixed-Income Bonds & Notes 36.5 Government Agencies & Obligations 9.8 Collateralized Mortgage Obligations 7.0 Asset-Backed Securities 3.3 Short-Term Obligations 4.0 Other Assets & Liabilities, Net 0.6 ----- 100.0% ===== See Accompanying Notes to Financial Statements. | 109 INVESTMENT PORTFOLIO ___________________________________________________________ February 28, 2005 (Unaudited) Columbia National Municipal Bond Fund PAR ($) VALUE ($) ------- ------------- MUNICIPAL BONDS - 90.0% EDUCATION - 2.4% EDUCATION - 2.4% IL State Educational Facilities Authority DePaul University, Series 2003 C, Insured: AMBAC 5.000% 09/01/18 250,000 263,945 ------------- Education Total 263,945 ------------- EDUCATION TOTAL 263,945 HEALTH CARE - 11.0% HOSPITALS - 11.0% IA Finance Authority Health Care Facilities Revenue, Genesis Medical Center, Insured: MBIA 6.100% 07/01/15 285,000 321,098 IN Board Bank Revenue Special Program, Hendricks, Series 2002 D, Insured: AMBAC 5.375% 04/01/15 250,000 274,758 NH Health & Education Facilities Authority Concord Hospital Revenue, Series 2004, Insured: FGIC 5.000% 10/01/12 230,000 250,339 OR Benton County Hospital Facilities Authority Refunding Samaritan Health Services Project, 4.600% 10/01/09 40,000 41,742 OR Deschutes County Hospital Facilities Authority Cascade Health Services, Inc., Series 2002, 5.600% 01/01/27 100,000 106,397 WA State Health Care Facilities Authority Revenue Grays Harbor Community Hospital, Series 1996, Insured: RAD 5.700% 07/01/16 200,000 209,796 ------------- Hospitals Total 1,204,130 ------------- HEALTH CARE TOTAL 1,204,130 PAR ($) VALUE ($) ------- ------------- HOUSING - 0.7% SINGLE FAMILY - 0.7% CO Housing Finance Authority Single Family, 4.875% 04/01/07 10,000 10,015 IA Single Family Mortgage Series A, Insured: GNMA 5.800% 07/01/16 60,000 62,744 ------------- Single Family Total 72,759 ------------- HOUSING TOTAL 72,759 OTHER - 16.0% POOL/BOND BANK - 6.0% AK Municipal Bond Bank Authority Series C, Insured: MBIA 5.500% 09/15/16 100,000 110,853 KS Development Finance Authority 5.000% 04/01/10 250,000 271,778 MS Development Bank, Natchez Convention Center Project, Insured: AMBAC 6.500% 07/01/13 230,000 275,662 ------------- Pool/Bond Bank Total 658,293 REFUNDED/ESCROWED (A) - 10.0% AK Industrial Development & Export Authority, Snettisham Hydroelectric, Series 1, AMT, Pre-refunded Escrowed to Maturity, Insured: AMBAC 5.500% 01/01/08 5,000 5,314 AK Palmer Valley Hospital Association Pre-refunded 12/01/09, Insured: RAD 5.350% 12/01/12 125,000 138,661 IL Madison & St. Clair Counties School District No. 010, Collinsville School Building, Pre-refunded 02/01/11, Insured: FGIC 5.500% 02/01/12 250,000 280,230 MI State Hospital Finance Authority Ascension Health Credit, Series A, Pre-refunded 11/15/09, Insured: MBIA 6.000% 11/15/19 100,000 113,464 NY New York City Pre-refunded 05/15/10, Series 2000 A, 6.000% 05/15/21 225,000 258,577 110 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia National Municipal Bond Fund PAR ($) VALUE ($) ------- ------------- MUNICIPAL BONDS - (CONTINUED) OTHER - (CONTINUED) REFUNDED/ESCROWED - (CONTINUED) WA Tacoma Solid Waste Utilities Pre-refunded Escrowed to Maturity, Series 1997 B, Insured: AMBAC 6.000% 12/01/09 15,000 16,981 WI Marshall School District Pre-refunded 03/01/12, Series 2002 A, Insured: FGIC 5.000% 03/01/14 250,000 274,872 ------------- Refunded/Escrowed Total 1,088,099 ------------- OTHER TOTAL 1,746,392 RESOURCE RECOVERY - 3.3% DISPOSAL - 3.3% AR Little Rock Waste Disposal Revenue Series 2002, Insured: MBIA 5.000% 05/01/16 250,000 266,865 WA Tacoma Solid Waste Utilities Unrefunded, Series 1997 B, Insured: AMBAC 6.000% 12/01/09 85,000 95,491 ------------- Disposal Total 362,356 ------------- RESOURCE RECOVERY TOTAL 362,356 TAX-BACKED - 39.6% LOCAL APPROPRIATED - 6.5% IN West Lafayette Industrial Building Corp. First Mortgage, Police Station Project, Insured: FGIC 5.000% 07/15/18 250,000 267,390 MI Sturgis Public School District School Building & Site, Insured: QSBLF 5.500% 05/01/14 250,000 277,930 SC Charleston County Certificates of Participation, Series 2004, Insured: MBIA 5.000% 12/01/10 150,000 162,505 ------------- Local Appropriated Total 707,825 PAR ($) VALUE ($) ------- ------------- LOCAL GENERAL OBLIGATIONS - 13.2% IL Chicago Park District Aquarium & Museum Insured: FGIC 5.800% 01/01/18 150,000 165,939 LA Calcasieu Parish School District No. 31 Public School Improvement, Series 2000, Insured: FGIC 5.500% 05/01/16 250,000 275,455 NY New York City Unrefunded, Series 2000 A, 6.000% 05/15/21 25,000 27,929 OH Oak Hills Local School District Insured: MBIA 7.200% 12/01/09 100,000 117,688 SC Charleston County School District, Series 2001, Insured: FSA 5.000% 02/01/18 200,000 214,110 TN Lawrenceburg Public Building Authority Electric System Public Works, Series C, Insured: FSA 5.500% 07/01/16 295,000 328,813 TX Magnolia Independent School District Insured: PSFG 5.250% 08/15/17 280,000 306,258 WA Yakima County School District No. 119 Selah, Insured: FGIC 5.000% 12/01/06 10,000 10,407 ------------- Local General Obligations Total 1,446,599 SPECIAL NON-PROPERTY TAX - 8.5% CA State Economic Recovery Series 2004 A, Insured: MBIA 5.000% 07/01/11 200,000 220,024 IL Chicago Motor Fuel Tax Revenue Series 2003 A, Insured: AMBAC 5.250% 01/01/17 250,000 274,035 OK Okmulgee County 1st Mortgage, Insured: MBIA 6.000% 03/01/15 200,000 220,000 TX Laredo Sports Venue Sales Tax Insured: FGIC 5.750% 03/15/13 200,000 219,754 ------------- Special Non-Property Tax Total 933,813 See Accompanying Notes to Financial Statements. | 111 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia National Municipal Bond Fund PAR ($) VALUE ($) ------- ------------- MUNICIPAL BONDS - (CONTINUED) TAX-BACKED - (CONTINUED) SPECIAL PROPERTY TAX - 1.9% OR Lebanon Urban Renewal Agency 5.625% 06/01/19 100,000 106,279 OR Redmond Urban Renewal Agency Downtown Area B, 5.650% 06/01/13 100,000 104,141 ------------- Special Property Tax Total 210,420 STATE APPROPRIATED - 3.5% KY State Property & Buildings Commission Revenues Series 2001, 5.250% 11/01/11 250,000 277,338 WA State Certificates of Participation Department of General Administration, 5.400% 07/01/13 100,000 106,014 ------------- State Appropriated Total 383,352 STATE GENERAL OBLIGATIONS - 6.0% NV Colorado River Commission Hoover Dam Project, Series 2002, Insured: FSA 5.375% 10/01/14 250,000 279,857 OR State Veterans Welfare Series 75, 5.875% 10/01/18 10,000 10,290 PR Public Finance Corp. Series 2004 A, Insured: AMBAC 5.250% 08/01/30 (b) 110,000 121,460 WI State GO Series 2004 2, Insured: MBIA 5.000% 05/01/12 225,000 246,240 ------------- State General Obligations Total 657,847 ------------- TAX-BACKED TOTAL 4,339,856 TRANSPORTATION - 1.1% TRANSPORTATION - 1.1% IL Regional Transportation Authority Series A, Insured: AMBAC 6.400% 06/01/12 100,000 116,687 ------------- Transportation Total 116,687 ------------- TRANSPORTATION TOTAL 116,687 PAR ($) VALUE ($) ------- ------------- UTILITIES - 15.9% INVESTOR OWNED - 1.9% AK Industrial Development & Export Authority Snettisham Hydroelectric, Series 1, Unrefunded, AMT, Insured: AMBAC 5.500% 01/01/08 95,000 101,366 OR Port of St. Helens Pollution Control Portland General Electric Co., Series B, 4.800% 06/01/10 105,000 106,867 ------------- Investor Owned Total 208,233 JOINT POWER AUTHORITY - 4.4% WA State Public Power Supply System Nuclear Project No. 1 Revenue, Series 1997 B, 5.125% 07/01/14 300,000 316,143 Nuclear Project No. 2 Refunding, Series A, 5.000% 07/01/11 50,000 53,671 WY Municipal Power Agency Power Supply Refunding, Series 1998, Insured: MBIA 5.250% 01/01/11 100,000 109,097 ------------- Joint Power Authority Total 478,911 MUNICIPAL ELECTRIC - 7.0% CA State Department of Water Resource Power Supply Revenue, Series 2002, Insured: AMBAC 5.000% 05/01/16 250,000 269,110 OR Eugene Trojan Nuclear Project 5.900% 09/01/09 20,000 20,406 TN Metropolitan Government Nashville Series 2002 A, Insured: AMBAC 5.125% 10/01/13 285,000 312,645 TX Harris County Health Facilities Development Corp., Teco Project, Series 1999 B, Insured: AMBAC 5.700% 02/15/15 150,000 164,992 ------------- Municipal Electric Total 767,153 112 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia National Municipal Bond Fund PAR ($) VALUE ($) ------- ------------- MUNICIPAL BONDS - (CONTINUED) UTILITIES - (CONTINUED) WATER & SEWER - 2.6% OH State Water Development Authority Revenue, Fresh Water, Series 2001 B, Insured: FSA 5.500% 12/01/18 250,000 291,100 ------------- Water & Sewer Total 291,100 ------------- UTILITIES TOTAL 1,745,397 Total Municipal Bonds (Cost of $9,391,309) 9,851,522 INVESTMENT COMPANY - 0.0% Dreyfus Tax-Exempt Cash Management Fund 1 1 ------------- Total Investment Company (Cost of $1) 1 SHORT-TERM OBLIGATIONS - 7.3% VARIABLE RATE DEMAND NOTES (C) - 7.3% IN Development Finance Authority Cathedral High Trustees, Inc., Series 2001, 1.850% 09/01/26 100,000 100,000 MN Mankato Minnesota Revenue Bethany Lutheran College, Series 2000 B, 1.850% 11/01/15 100,000 100,000 MO State Health & Educational Facilities Authority Washington University, Series 1996 C, 1.800% 09/01/30 300,000 300,000 MS Jackson County Pollution Control Revenue Chevron U.S.A., Inc. Project, Series 1992, 1.800% 12/01/16 300,000 300,000 ------------- VARIABLE RATE DEMAND NOTES TOTAL 800,000 Total Short-Term Obligations (Cost of $800,000) 800,000 VALUE ($) ------------- TOTAL INVESTMENTS - 97.3% (COST OF $10,191,310) (d) 10,651,523 OTHER ASSETS & LIABILITIES, NET - 2.7% 300,809 NET ASSETS - 100.0% 10,952,332 NOTES TO INVESTMENT PORTFOLIO: (a) The Fund has been informed that each issuer has placed direct obligations of the U.S. government in an irrevocable trust, solely for the payment of principal and interest. (b) Variable rate security. The interest rate shown reflects the rate as of February 28, 2005. (c) Variable rate demand notes. These securities are payable upon demand and are secured by letters of credit or other credit support agreements from banks. The interest rates change periodically and the interest rates shown reflect the rates as of February 28, 2005. (d) Cost for federal income tax purposes is $10,190,178. At February 28, 2005, the Fund held investments in the following sectors: % OF HOLDINGS BY REVENUE SOURCE NET ASSETS ---------------------------------------------------------------- Tax-Backed 39.6% Other 16.0 Utilities 15.9 Health Care 11.0 Resource Recovery 3.3 Education 2.4 Transportation 1.1 Housing 0.7 Investment Company 0.0 Short-Term Obligations 7.3 Other Assets & Liabilities, Net 2.7 ----- 100.0% ===== ACRONYM NAME ------- ---- AMBAC Ambac Assurance Corp. AMT Alternative Minimum Tax FGIC Financial Guaranty Insurance Co. FSA Financial Security Assurance, Inc. GNMA Government National Mortgage Association GO General Obligation MBIA MBIA Insurance Corp. PSFG Permanent School Fund Guaranteed QSBLF Qualified School Bond Loan Fund RAD Radian Assset Assurance, Inc. See Accompanying Notes to Financial Statements. | 113 INVESTMENT PORTFOLIO ___________________________________________________________ February 28, 2005 (Unaudited) Columbia Oregon Municipal Bond Fund PAR ($) VALUE ($) ------- ------------- MUNICIPAL BONDS - 98.1% EDUCATION - 6.4% EDUCATION - 5.1% OR Multnomah County Educational Facilities Authority, University of Portland Project: 5.700% 04/01/15 1,000,000 1,060,080 6.000% 04/01/20 1,000,000 1,086,470 6.000% 04/01/25 500,000 530,035 University of Portland Project, Refunding, Insured: AMBAC 5.000% 04/01/11 1,150,000 1,222,967 5.750% 04/01/10 2,000,000 2,159,720 OR State Health Sciences University Series A: Insured: MBIA (a) 07/01/09 1,530,000 1,331,299 (a) 07/01/12 1,315,000 996,757 (a) 07/01/14 2,550,000 1,750,167 (a) 07/01/15 4,325,000 2,815,272 (a) 07/01/21 12,515,000 5,923,475 OR State Health, Housing, Educational & Cultural Facilities Authority, Linfield College Project, Series A: 4.650% 10/01/09 555,000 578,488 5.500% 10/01/18 1,000,000 1,040,960 Reed College Project, Series A: 5.300% 07/01/11 500,000 526,195 Insured: MBIA 5.100% 07/01/10 900,000 967,311 ------------- Education Total 21,989,196 PREP SCHOOL - 1.3% OR State Facilities Authority Revenue French American International School Project, Series A, 6.250% 04/01/27 5,270,000 5,395,900 ------------- Prep School Total 5,395,900 ------------- EDUCATION TOTAL 27,385,096 PAR ($) VALUE ($) ------- ------------- HEALTH CARE - 12.3% CONTINUING CARE RETIREMENT - 0.7% OR Albany Hospital Facility Authority Mennonite Home Albany, Series PJ-A: 4.750% 10/01/11 660,000 687,878 5.000% 10/01/12 680,000 715,530 OR Clackamas County Hospital Facility Authority Willamette View, Inc. Project, Series A, 6.850% 11/01/15 1,480,000 1,603,240 ------------- Continuing Care Retirement Total 3,006,648 HOSPITALS - 11.4% OR Benton County Hospital Facilities Authority Samaritan Health Services Project, Refunding: 4.400% 10/01/07 220,000 226,455 4.800% 10/01/11 245,000 254,908 5.200% 10/01/17 2,255,000 2,333,677 OR Clackamas County Hospital Facility Authority Legacy Health System: 4.600% 05/01/10 885,000 934,542 5.000% 02/15/16 1,010,000 1,055,571 5.500% 02/15/13 5,450,000 5,880,877 5.500% 02/15/14 2,385,000 2,571,340 5.750% 05/01/12 2,000,000 2,237,960 Legacy Health System Insured: MBIA 5.500% 02/15/13 495,000 542,941 Legacy Health System, Refunding: 5.250% 05/01/21 4,890,000 5,195,625 5.750% 05/01/16 1,500,000 1,652,295 Williamette Falls Hospital Project, 5.750% 04/01/14 705,000 737,254 OR Deschutes County Hospital Facilities Authority Cascade Health Services, Inc.: 5.500% 01/01/22 2,000,000 2,129,840 5.600% 01/01/27 5,550,000 5,905,033 5.600% 01/01/32 2,000,000 2,119,500 OR Medford Hospital Facilities Authority Asante Health System, Series A: Insured: MBIA 5.250% 08/15/10 1,500,000 1,617,075 5.250% 08/15/11 800,000 859,704 OR Multnomah County Hospital Facilities Authority Revenue Providence Health System, 5.250% 10/01/16 2,970,000 3,260,733 114 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Oregon Municipal Bond Fund PAR ($) VALUE ($) ------- ------------- MUNICIPAL BONDS - (CONTINUED) HEALTH CARE - (CONTINUED) HOSPITALS - (CONTINUED) OR Ontario Catholic Health Holy Rosary Medical Center Insured: MBIA 5.500% 11/15/12 1,500,000 1,560,450 OR Salem Hospital Facility Authority 5.000% 08/15/18 2,000,000 2,069,420 5.250% 08/15/14 4,860,000 5,173,373 OR Umatilla County Hospital Facility Authority Catholic Health Initiatives, Series A, 5.750% 12/01/20 285,000 315,019 ------------- Hospitals Total 48,633,592 NURSING HOMES - 0.2% OR Clackamas County Hospital Facility Authority Odd Fellows Home, Series A, Refunding, 5.875% 09/15/21 705,000 658,294 ------------- Nursing Homes Total 658,294 ------------- HEALTH CARE TOTAL 52,298,534 HOUSING - 7.8% ASSISTED LIVING/SENIOR - 0.7% OR Clackamas County Hospital Facility Authority Robison Jewish Home Project, 6.250% 10/01/21 1,650,000 1,781,126 OR State Health, Housing, Educational & Cultural Facilities Authority St. Anthony's Village Housing, Series A, AMT, 7.250% 06/01/28 1,360,000 1,367,548 ------------- Assisted Living/Senior Total 3,148,674 MULTI-FAMILY - 4.4% OR Clackamas County Housing Authority Multi-Family Housing, Easton Ridge, Series A, 5.800% 12/01/16 2,255,000 2,294,530 OR State Housing & Community Services Department Multiple Purpose, Series A: Insured: FSA 3.550% 01/01/13 1,000,000 997,930 3.550% 07/01/13 1,000,000 994,960 3.650% 01/01/14 1,000,000 996,220 3.650% 07/01/14 1,000,000 994,480 PAR ($) VALUE ($) ------- ------------- OR State Housing & Community Services, Department of Housing, Finance Assisted, Insured: FHA 6.800% 07/01/13 7,250,000 7,263,485 OR Washington County Housing Authority Affordable Housing, Series A, 5.750% 07/01/23 1,000,000 1,024,510 Affordable Housing Pool, Series A: 6.000% 07/01/20 2,000,000 2,050,240 6.000% 07/01/23 1,000,000 1,032,250 PR Housing Finance Corp. Multi-Family Mortgage Portfolio A-1, Insured: FHA 7.500% 04/01/22 715,000 717,438 ------------- Multi-Family Total 18,366,043 SINGLE FAMILY - 2.7% OR State Housing & Community Services, Department of Mortgage Revenue, Single Family Program: Series A, 4.850% 07/01/10 150,000 157,731 Series D, 6.700% 07/01/13 495,000 495,891 Series E: 5.375% 07/01/21 3,230,000 3,394,149 Insured: FHA 5.700% 07/01/12 700,000 712,215 5.800% 07/01/14 620,000 631,228 6.000% 07/01/20 1,735,000 1,768,676 Series J, 5.150% 07/01/24 2,445,000 2,525,196 Series M, AMT, 5.800% 07/01/12 210,000 220,559 Series Q: 4.700% 07/01/15 690,000 721,029 4.900% 07/01/17 675,000 707,771 OR State Housing Finance Revenue Insured: FHA 5.800% 07/01/09 180,000 181,257 ------------- Single Family Total 11,515,702 ------------- HOUSING TOTAL 33,030,419 OTHER - 17.5% OTHER - 0.9% OR State Health, Housing, Educational & Cultural Facilities Authority Goodwill Industries Lane County, Series A, 6.650% 11/15/22 (b) 3,750,000 3,745,425 ------------- Other Total 3,745,425 See Accompanying Notes to Financial Statements. | 115 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Oregon Municipal Bond Fund PAR ($) VALUE ($) ------- ------------- MUNICIPAL BONDS - (CONTINUED) OTHER - (CONTINUED) POOL/BOND BANK - 0.3% OR State Economic Community Development Department Series A, Insured: MBIA 5.375% 01/01/11 1,105,000 1,200,671 ------------- Pool/Bond Bank Total 1,200,671 REFUNDED/ESCROWED (C) - 16.3% OR Board of Higher Education Series A, Pre-refunded 08/01/11: 5.250% 08/01/14 1,225,000 1,351,812 5.250% 08/01/16 4,550,000 5,021,016 OR Clackamas County Hospital Facility Authority Kaiser Permanente, Series A, Pre-refunded Escrowed to Maturity, 5.375% 04/01/14 7,135,000 7,816,963 OR Clackamas County School District No. 086, Pre-refunded 06/15/10, 6.000% 06/15/16 2,350,000 2,678,836 School District No. 12, North Clackamas, Pre-refunded 06/01/09: Insured: FGIC 5.250% 06/01/11 1,000,000 1,091,780 5.250% 06/01/15 2,750,000 3,002,395 School District No. 62C, Pre-refunded 06/15/10, 5.375% 06/15/17 1,250,000 1,387,038 OR Josephine County School District No. 7 Grants Pass, Pre-refunded 06/01/07, Insured: FGIC 5.700% 06/01/13 2,000,000 2,134,460 OR Multnomah County School District No. 7, Reynolds, Pre-refunded 06/15/11: 5.625% 06/15/14 2,670,000 3,021,692 5.625% 06/15/17 1,000,000 1,131,720 Series A, Pre-refunded 04/01/10, 5.500% 04/01/19 2,395,000 2,666,138 PAR ($) VALUE ($) ------- ------------- OR Multnomah-Clackamas Counties Centennial School District No. 28-302, Pre-refunded 06/15/11: Insured: FGIC 5.375% 06/15/16 2,055,000 2,296,689 5.375% 06/15/17 2,280,000 2,548,151 5.375% 06/15/18 2,490,000 2,782,849 OR North Clackamas Parks & Recreation District Facilities Pre-refunded Escrowed to Maturity, 5.700% 04/01/13 2,920,000 3,262,136 OR Northern Oregon Corrections Pre-refunded 09/15/07: Insured: AMBAC 5.250% 09/15/12 1,000,000 1,063,950 5.300% 09/15/13 1,000,000 1,065,180 OR Portland Arena Gas Tax Pre-refunded 06/01/06: Insured: FSA (a) 06/01/16 1,100,000 574,079 (a) 06/01/17 2,320,000 1,133,018 OR Salem Water & Sewer Pre-refunded 06/01/10, Insured: FSA 5.300% 06/01/15 1,500,000 1,658,370 OR Salem-Keizer School District No. 24J Pre-refunded 06/01/09: 5.000% 06/01/15 1,000,000 1,081,840 5.000% 06/01/16 1,380,000 1,492,939 OR State Board of Higher Education Lottery Education Project, Series A, Pre-refunded 04/01/09: Insured: FSA 5.000% 04/01/14 2,705,000 2,964,626 5.250% 04/01/13 1,600,000 1,756,960 OR State City Sewer Pre-refunded 10/01/05, 6.500% 10/01/07 390,000 402,386 OR State Department of Administrative Services Certificates of Participation, Series A, Pre-refunded 06/01/07, Insured: AMBAC 5.300% 05/01/08 750,000 799,500 OR State Department of Transportation Highway User Tax, Series A, Pre-refunded 11/15/12, 5.500% 11/15/16 2,500,000 2,844,375 OR Umatilla County Hospital Facility Authority Catholic Health Initiatives, Series A, Pre-refunded Escrowed to Maturity: 5.750% 12/01/20 245,000 276,441 6.000% 12/01/30 4,825,000 5,502,044 116 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Oregon Municipal Bond Fund PAR ($) VALUE ($) ------- ------------- MUNICIPAL BONDS - (CONTINUED) OTHER - (CONTINUED) REFUNDED/ESCROWED (C) - (CONTINUED) OR Washington County Beaverton: Pre-refunded 08/01/08, 5.250% 08/01/10 1,150,000 1,242,552 Pre-refunded 06/01/09, Insured: FGIC 5.100% 06/01/12 500,000 542,910 School District No. 088J, Sherwood, Pre-refunded 06/01/05, Insured: FSA 6.100% 06/01/12 185,000 186,881 School District No. 48J, Unified Sewer Agency Pre-refunded 10/01/06, Insured: FGIC 5.500% 10/01/16 1,250,000 1,319,938 VI Public Finance Authority Series A, Pre-refunded Escrowed to Maturity, 7.300% 10/01/18 1,185,000 1,540,784 ------------- Refunded/Escrowed Total 69,642,448 ------------- OTHER TOTAL 74,588,544 OTHER REVENUE - 2.2% RECREATION - 2.2% OR State Board of Higher Education Lottery Education Project, Series A: Insured: FSA 5.000% 04/01/14 2,830,000 3,109,902 5.250% 04/01/11 4,000,000 4,360,040 Series B, Insured: FSA 5.250% 04/01/15 1,315,000 1,427,538 OR State Health, Housing, Educational & Cultural Facilities Authority, Aquarium: 4.750% 10/01/08 (b)(d) 1,550,000 325,500 4.900% 10/01/09 (b)(d) 670,000 140,780 ------------- Recreation Total 9,363,760 ------------- OTHER REVENUE TOTAL 9,363,760 PAR ($) VALUE ($) ------- ------------- TAX-BACKED - 41.4% LOCAL APPROPRIATED - 0.6% OR Deschutes & Jefferson County School District No. 02J Series B, Insured: FGIC (a) 06/15/22 2,335,000 1,034,895 OR Deschutes County Certificates of Participation, Series A, 5.050% 06/01/17 420,000 428,833 OR Multnomah County Certificates of Participation, 4.550% 08/01/10 1,000,000 1,051,850 ------------- Local Appropriated Total 2,515,578 LOCAL GENERAL OBLIGATIONS - 27.0% OR Aurora 5.600% 06/01/24 1,205,000 1,272,757 OR Bend Municipal Airport Project Series B, AMT, 5.375% 06/01/13 150,000 158,058 OR Benton & Linn Counties School District No. 509J, Corvallis, Insured: FSA 5.000% 06/01/17 2,665,000 2,866,234 OR Canyonville South Umpqua Rural Fire District 5.400% 07/01/31 610,000 648,180 OR Clackamas & Washington Counties School District No. 003JT, Insured: FGIC (a) 06/15/17 4,000,000 2,293,120 OR Clackamas Community College Insured: FGIC 5.250% 06/15/15 1,500,000 1,643,565 OR Clackamas County Lake Oswego Series: 5.375% 06/01/15 2,450,000 2,710,386 5.375% 06/01/16 1,295,000 1,431,869 5.375% 06/01/17 2,535,000 2,799,324 School District No. 108, 5.375% 06/15/15 1,055,000 1,167,758 OR Columbia County School District No. 502, Defered Interest Insured: FGIC (a) 06/01/13 1,685,000 1,219,873 (a) 06/01/14 1,025,000 705,856 OR Coos Bay 4.900% 09/01/07 1,505,000 1,546,222 See Accompanying Notes to Financial Statements. | 117 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Oregon Municipal Bond Fund PAR ($) VALUE ($) ------- ------------- MUNICIPAL BONDS - (CONTINUED) TAX-BACKED - (CONTINUED) LOCAL GENERAL OBLIGATIONS - (CONTINUED) OR Coos County School District No. 13, North Bend, Insured: FSA 5.500% 06/15/15 1,765,000 1,977,224 OR Crook County School District, Insured: FSA 5.000% 02/01/14 2,860,000 3,105,674 OR Deschutes County School District No. 1, Series A, Insured: FSA 5.500% 06/15/18 1,000,000 1,110,310 OR Eugene Public Safety Facilities 5.500% 06/01/10 850,000 881,501 5.625% 06/01/13 1,295,000 1,344,327 OR Jackson County School District No. 4, Phoenix-Talent, Insured: FSA 5.500% 06/15/16 1,000,000 1,113,890 School District No. 6, Central Point, 6.000% 06/15/09 1,090,000 1,218,391 School District No. 9, Eagle Point, 5.625% 06/15/15 1,920,000 2,153,299 OR Jefferson County School District No. 509J, Madras School District, Insured: FGIC 5.250% 06/15/18 1,075,000 1,178,490 OR Josephine County School District No. 7, Grants Pass, 4.000% 06/15/11 2,000,000 2,072,600 Unit School District, Three Rivers: Insured: FGIC 5.000% 12/15/15 1,000,000 1,102,710 5.000% 12/15/16 1,000,000 1,104,160 PAR ($) VALUE ($) ------- ------------- OR Lane County School District No. 19, Springfield, Refunding: Insured: FGIC 6.000% 10/15/12 1,740,000 2,027,361 6.000% 10/15/14 1,310,000 1,553,110 School District No. 4J Eugene, Refunding, 5.000% 07/01/12 1,000,000 1,098,370 School District No. 4J: Eugene, Refunding, Insured: FGIC 5.250% 07/01/13 1,000,000 1,119,460 OR Lincoln County School District, Insured: FGIC 5.600% 06/15/10 3,480,000 3,832,489 OR Linn Benton Community College Insured: FGIC (a) 06/15/13 1,000,000 715,190 (a) 06/15/14 1,000,000 680,150 OR Linn County Community School District No. 9, Lebanon: Insured: FGIC 5.250% 06/15/15 710,000 786,368 5.550% 06/15/21 2,000,000 2,242,420 OR Metro Washington Park Zoo Series A, 5.300% 01/15/11 1,000,000 1,046,300 OR Metro 5.250% 09/01/14 3,130,000 3,473,517 OR Multnomah County School District No. 40, Insured: FSA 5.000% 12/01/14 1,790,000 1,944,101 OR Multnomah-Clackamas Counties School District Number 10JT, Series A, Insured: FSA 5.250% 06/15/12 1,000,000 1,114,170 OR Portland Community College District Series A: 5.375% 06/01/14 1,925,000 2,137,250 5.375% 06/01/16 2,705,000 2,990,891 5.375% 06/01/17 2,540,000 2,804,846 OR Portland Limited Tax Series A, 4.900% 04/01/12 1,430,000 1,488,987 Series B: (a) 06/01/12 1,750,000 1,329,423 (a) 06/01/13 1,500,000 1,084,170 (a) 06/01/16 3,500,000 2,155,090 (a) 06/01/18 4,000,000 2,211,560 (a) 06/01/19 4,000,000 2,097,240 (a) 06/01/20 4,000,000 1,986,560 118 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Oregon Municipal Bond Fund PAR ($) VALUE ($) ------- ------------- MUNICIPAL BONDS - (CONTINUED) TAX-BACKED - (CONTINUED) LOCAL GENERAL OBLIGATIONS - (CONTINUED) OR Rouge Community College District Refunding: Insured: MBIA 5.000% 06/15/15 1,015,000 1,119,941 5.000% 06/15/16 1,050,000 1,152,732 5.000% 06/15/17 1,255,000 1,371,088 OR Salem-Keizer School District No. 24J, Insured: FSA 5.000% 06/15/18 2,000,000 2,158,740 OR Tualatin Hills Park & Recreation District Insured: FGIC 5.750% 03/01/14 990,000 1,146,984 OR Washington & Clackamas Counties Deferred Interest, Series A, (a) 06/01/10 1,520,000 1,250,778 School District No. 23J, Tigard: (a) 06/15/18 2,700,000 1,488,267 Insured: MBIA 5.375% 06/15/17 1,500,000 1,658,805 OR Washington County 5.500% 06/01/16 2,785,000 3,100,429 School District No. 15, Forest Grove: Insured: FSA 5.375% 06/15/13 2,070,000 2,304,117 5.375% 06/15/15 2,515,000 2,783,803 School District No. 48J, Beaverton: 5.125% 01/01/14 2,000,000 2,177,980 5.125% 01/01/17 1,820,000 1,963,962 5.125% 01/01/18 2,260,000 2,436,303 Criminal Justice Facilities, Refunding, 5.000% 12/01/10 1,400,000 1,478,974 OR Washington Multnomah & Yamhill Counties School District No. 1J: 5.250% 06/01/14 500,000 540,330 Insured: MBIA 5.000% 11/01/13 1,100,000 1,213,212 5.000% 06/01/13 1,500,000 1,631,910 OR Yamhill County School District No. 029J, Insured: MBIA 5.250% 06/15/16 2,535,000 2,785,838 School District No. 40, Insured: FGIC 6.000% 06/01/09 500,000 559,795 ------------- Local General Obligations Total 115,068,789 PAR ($) VALUE ($) ------- ------------- SPECIAL NON-PROPERTY TAX - 0.4% OR Portland Gas Tax Series A, Insured: FSA 5.800% 06/01/16 1,640,000 1,703,025 ------------- Special Non-Property Tax Total 1,703,025 SPECIAL PROPERTY TAX - 6.8% OR Hood River Urban Renewal Agency 6.250% 12/15/11 1,120,000 1,186,058 OR Lebanon Urban Renewal Agency 5.625% 06/01/19 1,000,000 1,062,790 5.750% 06/01/15 1,120,000 1,170,310 6.000% 06/01/20 1,580,000 1,688,736 OR Medford Urban Renewal 5.875% 09/01/10 500,000 516,800 OR Portland Airport Way, Urban Renewal & Redevelopment Convention Center, Series A, Insured: AMBAC 5.750% 06/15/17 1,500,000 1,684,425 Series A, Insured: AMBAC 5.750% 06/15/18 2,050,000 2,298,767 OR Portland Limited Tax Series A, 3.400% 06/01/13 1,675,000 1,669,657 OR Portland River District, Urban Renewal & Redevelopment Series A: Insured: AMBAC 5.000% 06/15/17 1,500,000 1,613,715 5.000% 06/15/18 3,070,000 3,295,399 5.000% 06/15/20 2,000,000 2,134,760 OR Portland Urban Renewal & Redevelopment South Park Blocks, Series A: Insured: AMBAC 5.750% 06/15/17 2,065,000 2,318,892 5.750% 06/15/19 2,580,000 2,893,083 OR Redmond Urban Renewal Agency Revenue Refunding South Airport Industrial Area A, 5.700% 06/01/19 650,000 665,275 OR Redmond Urban Renewal Agency Downtown Area B: 5.650% 06/01/13 720,000 749,815 5.850% 06/01/19 785,000 816,730 OR Seaside Urban Renewal Agency Greater Seaside Urban Renewal, 5.250% 06/01/15 1,000,000 1,041,140 See Accompanying Notes to Financial Statements. | 119 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Oregon Municipal Bond Fund PAR ($) VALUE ($) ------- ------------- MUNICIPAL BONDS - (CONTINUED) TAX-BACKED - (CONTINUED) SPECIAL PROPERTY TAX - (CONTINUED) OR Veneta Urban Renewal Agency 5.375% 02/15/16 700,000 745,318 5.625% 02/15/21 1,100,000 1,163,547 OR Wilsonville Limited Tax Improvement 5.000% 12/01/10 250,000 251,358 ------------- Special Property Tax Total 28,966,575 STATE APPROPRIATED - 3.7% OR State Department of Administrative Services Certificates of Participation, Refunding, Series A: Insured: AMBAC 4.500% 05/01/12 1,020,000 1,066,869 5.000% 05/01/13 4,240,000 4,580,981 5.000% 05/01/14 1,000,000 1,080,420 Series B, Insured: MBIA 5.250% 05/01/10 840,000 921,782 Series C: Insured: MBIA 5.250% 11/01/15 1,000,000 1,094,860 5.250% 11/01/17 5,000,000 5,467,700 Series E, Insured: FSA 5.000% 11/01/13 1,470,000 1,598,949 ------------- State Appropriated Total 15,811,561 STATE GENERAL OBLIGATIONS - 2.9% OR Elderly & Disabled Housing Refunding, Series B: 6.250% 08/01/13 55,000 55,195 4.950% 08/01/20 985,000 1,024,617 OR State Board of Higher Education Deferred Interest, Series A, (a) 08/01/17 1,050,000 607,708 Series A: 5.000% 08/01/12 2,075,000 2,274,490 (a) 08/01/14 490,000 334,464 5.250% 08/01/14 255,000 281,288 5.250% 08/01/16 780,000 855,091 OR State 9.200% 10/01/08 385,000 466,709 Series A, 5.250% 10/15/15 1,735,000 1,920,801 OR Veterans Welfare 8.000% 07/01/08 580,000 673,931 5.850% 10/01/15 360,000 370,516 Series 80A, 5.700% 10/01/32 2,175,000 2,202,796 PAR ($) VALUE ($) ------- ------------- PR Commonwealth of Puerto Rico Series A, 5.000% 07/01/30 1,000,000 1,066,300 ------------- State General Obligations Total 12,133,906 ------------- TAX-BACKED TOTAL 176,199,434 TRANSPORTATION - 2.5% AIRPORTS - 0.6% OR Eugene Airport Refunding, AMT: 5.650% 05/01/06 325,000 334,627 5.650% 05/01/07 555,000 582,250 5.700% 05/01/08 515,000 548,851 OR Port of Portland International Airport Series 12B, Refunding, Insured: FGIC 5.250% 07/01/12 1,000,000 1,076,810 ------------- Airports Total 2,542,538 PORTS - 0.6% OR Port Morrow 6.700% 06/01/20 2,000,000 2,010,560 OR Port of St. Helens 5.600% 08/01/14 315,000 323,354 5.750% 08/01/19 425,000 437,291 ------------- Ports Total 2,771,205 TRANSPORTATION - 1.3% OR Tri-County Metropolitan Transportation District Series 1, 5.400% 06/01/19 4,200,000 4,431,924 Series A, 5.000% 09/01/15 1,000,000 1,087,220 ------------- Transportation Total 5,519,144 ------------- TRANSPORTATION TOTAL 10,832,887 UTILITIES - 8.0% INVESTOR OWNED - 2.1% OR Port of St. Helens Pollution Control Portland General Electric Co.: Series A, 4.800% 04/01/10 5,195,000 5,286,796 Series B, 4.800% 06/01/10 3,500,000 3,562,230 ------------- Investor Owned Total 8,849,026 120 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Oregon Municipal Bond Fund PAR ($) VALUE ($) ------- ------------- MUNICIPAL BONDS - (CONTINUED) UTILITIES - (CONTINUED) MUNICIPAL ELECTRIC - 3.3% OR Deschutes Valley Water District 5.875% 09/01/05 810,000 823,146 OR Emerald Peoples Utility District Insured: FGIC 7.350% 11/01/10 2,160,000 2,610,338 7.350% 11/01/11 2,000,000 2,459,900 7.350% 11/01/12 2,490,000 3,113,048 7.350% 11/01/13 2,675,000 3,401,209 Series A, Insured: FSA 5.250% 11/01/20 605,000 661,319 OR Eugene Electric Utilities System, Series B, Refunding, Insured: FSA 5.250% 08/01/13 1,040,000 1,147,214 ------------- Municipal Electric Total 14,216,174 WATER & SEWER - 2.6% OR Myrtle Point Water 6.000% 12/01/20 510,000 550,713 OR Portland Sewer System Revenue Series A, Refunding, Insured: FGIC 5.000% 06/01/12 4,835,000 5,067,080 OR Powell Valley Water District 6.000% 02/01/15 620,000 660,120 OR Reedsport Water 7.000% 10/01/14 520,000 521,362 OR Sheridan Water Revenue 6.200% 05/01/15 625,000 674,531 6.450% 05/01/20 520,000 563,405 Refunding, 5.350% 04/01/18 300,000 312,225 OR Washington County Clean Water Services Sewer, Series Lien, Insured: MBIA 5.000% 10/01/13 2,310,000 2,547,099 ------------- Water & Sewer Total 10,896,535 ------------- UTILITIES TOTAL 33,961,735 Total Municipal Bonds (Cost of $397,133,116) 417,660,409 SHARES VALUE ($) ------- ------------- INVESTMENT COMPANIES - 0.2% Dreyfus Tax-Exempt Cash Management Fund 205,974 205,974 Money Market Obligations Trust 505,542 505,542 ------------- Total Investment Companies (Cost of $711,516) 711,516 SHORT-TERM OBLIGATIONS - 0.6% PAR ($) VARIABLE RATE DEMAND NOTES (E) - 0.6% FL Alachua Health Facilities Authority Oak Hammock University, Series 2002 A, 1.750% 10/01/32 300,000 300,000 IL Health Facilities Authority Revenue OSF Healthcare Systems, Series 2002: 1.770% 11/15/27 300,000 300,000 1.800% 11/15/27 400,000 400,000 IN Health Facility Financing Authority Revenue Golden Years Homestead, Series 2002 A, 1.870% 06/01/25 800,000 800,000 MN Minneapolis Convention Center, Series 2000, 1.720% 12/01/18 200,000 200,000 MN State Higher Education Facilities Authority St. Olaf College, Series 2002 5-M1, LOC: Harris Trust & Savings Bank, 1.750% 10/01/32 200,000 200,000 NY New York City Municipal Water Finance Authority Water & Sewer Systems Revenue, Series 1994 G, Insured: FGIC 1.750% 06/15/24 500,000 500,000 ------------- VARIABLE RATE DEMAND NOTES TOTAL 2,700,000 Total Short-Term Obligations (Cost of $2,700,000) 2,700,000 See Accompanying Notes to Financial Statements. | 121 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Oregon Municipal Bond Fund VALUE ($) ------------- TOTAL INVESTMENTS - 98.9% (COST OF $400,544,632) (F) 421,071,925 OTHER ASSETS & LIABILITIES, NET - 1.1% 4,643,268 NET ASSETS - 100.0% 425,715,193 NOTES TO INVESTMENT PORTFOLIO: (a) Zero coupon bond. (b) Denotes a restricted security, which is subject to restrictions on resale under federal securities laws. At February 28, 2005, the value of these securities amounted to $4,211,705, which represents 1.0% of net assets. ACQUISITION ACQUISITION SECURITY DATE COST ------- ------------- ------------- Oregon State Health, Housing, Educational & Cultural Facilities Authority, Authority/Aquarium: 4.750% 10/01/08 09/21/98 $ 1,539,906 4.900% 10/01/09 09/21/98 667,383 Oregon State Health, Housing, Educational & Cultural Facilities Authority, Goodwill Industries Lane County, Series A, 6.650% 11/15/22 06/17/98 3,855,000 ------------- $ 6,062,289 ============= (c) The Fund has been informed that each issuer has placed direct obligations of the U.S. Government in an irrevocable trust, solely for the payment of principal and interest. (d) The issuer is in default of certain debt covenants. Income is not being accrued. (e) Variable rate demand notes. These securities are payable upon demand and are secured by letters of credit or other credit support agreements from banks. The interest rates change periodically and the interest rates shown reflect the rates as of February 28, 2005. (f) Cost for federal income tax purposes is $400,400,148. At February 28, 2005, the Fund held investments in the following sectors: % OF HOLDINGS BY REVENUE SOURCE NET ASSETS ---------------------------------------------------------------------- Tax-Backed 41.4% Other 17.5 Health Care 12.3 Utilities 8.0 Housing 7.8 Education 6.4 Transportation 2.5 Other Revenue 2.2 Investment Companies 0.2 Short-Term Obligations 0.6 Other Assets & Liabilities, Net 1.1 ----- 100.0% ===== ACRONYM NAME ------- ---- AMBAC Ambac Assurance Corp. AMT Alternative Minimum Tax FGIC Financial Guaranty Insurance Co. FHA Federal Housing Administration FSA Financial Security Assurance, Inc. MBIA MBIA Insurance Corp. 122 | See Accompanying Notes to Financial Statements. INVESTMENT PORTFOLIO ___________________________________________________________ February 28, 2005 (Unaudited) Columbia High Yield Fund PAR ($) VALUE ($) ------- ------------- CORPORATE FIXED-INCOME BONDS & NOTES - 92.3% BASIC MATERIALS - 5.1% CHEMICALS - 3.6% CHEMICAL-SPECIALTY - 1.8% Ethyl Corp. 8.875% 05/01/10 8,400,000 9,240,000 MacDermid, Inc. 9.125% 07/15/11 9,520,000 10,531,500 Nalco Co. 7.750% 11/15/11 10,220,000 11,063,150 PQ Corp. 7.500% 02/15/13 (a) 675,000 696,937 ------------- 31,531,587 CHEMICALS-DIVERSIFIED - 0.8% Equistar Chemicals LP 10.125% 09/01/08 7,370,000 8,493,925 10.625% 05/01/11 4,805,000 5,561,788 ------------- 14,055,713 INDUSTRIAL-GASES - 1.0% Airgas, Inc. 9.125% 10/01/11 16,358,000 18,116,485 ------------- 18,116,485 ------------- Chemicals Total 63,703,785 FOREST PRODUCTS & PAPER - 1.0% PAPER & RELATED PRODUCTS - 1.0% Boise Cascade LLC 7.125% 10/15/14 (a) 16,875,000 17,971,875 ------------- 17,971,875 ------------- Forest Products & Paper Total 17,971,875 IRON/STEEL - 0.5% STEEL-PRODUCERS - 0.5% Russel Metals, Inc. 6.375% 03/01/14 8,780,000 8,889,750 ------------- 8,889,750 ------------- Iron/Steel Total 8,889,750 ------------- BASIC MATERIALS TOTAL 90,565,410 COMMUNICATIONS - 14.8% ADVERTISING - 1.9% ADVERTISING SALES - 1.9% Lamar Media Corp. 7.250% 01/01/13 31,203,000 33,699,240 ------------- 33,699,240 ------------- Advertising Total 33,699,240 PAR ($) VALUE ($) ------- ------------- MEDIA - 9.6% CABLE TV - 4.9% DirecTV Holdings 8.375% 03/15/13 24,895,000 28,100,231 EchoStar DBS Corp. 5.750% 10/01/08 22,125,000 22,456,875 6.625% 10/01/14 (a) 13,170,000 13,548,637 Rogers Cable, Inc. 6.250% 06/15/13 9,790,000 9,985,800 7.875% 05/01/12 11,225,000 12,431,688 ------------- 86,523,231 MULTIMEDIA - 0.3% Emmis Operating Co. 6.875% 05/15/12 5,345,000 5,451,900 ------------- 5,451,900 PUBLISHING-PERIODICALS - 3.5% Dex Media West LLC 5.875% 11/15/11 (a) 26,043,000 25,912,785 R.H. Donnelley Finance Corp. 8.875% 12/15/10 (a) 1,320,000 1,458,600 10.875% 12/15/12 (a) 21,445,000 25,197,875 10.875% 12/15/12 8,150,000 9,576,250 ------------- 62,145,510 TELEVISION - 0.9% LIN Television Corp. 6.500% 05/15/13 14,365,000 14,688,213 ------------- 14,688,213 ------------- Media Total 168,808,854 TELECOMMUNICATIONS - 3.3% CELLULAR TELECOMMUNICATIONS - 3.3% Nextel Communications, Inc. 5.950% 03/15/14 2,845,000 2,951,687 6.875% 10/31/13 3,390,000 3,661,200 7.375% 08/01/15 26,475,000 28,990,125 Rogers Wireless, Inc. 7.500% 03/15/15 7,865,000 8,612,175 8.000% 12/15/12 13,670,000 14,831,950 ------------- 59,047,137 ------------- Telecommunications Total 59,047,137 ------------- COMMUNICATIONS TOTAL 261,555,231 See Accompanying Notes to Financial Statements. | 123 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia High Yield Fund PAR ($) VALUE ($) ------- ------------- CORPORATE FIXED-INCOME BONDS & NOTES - (CONTINUED) CONSUMER CYCLICAL - 20.5% AUTO PARTS & EQUIPMENT - 0.3% AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL - 0.3% Accuride Corp. 8.500% 02/01/15 (a) 5,850,000 6,047,437 ------------- 6,047,437 ------------- Auto Parts & Equipment Total 6,047,437 ENTERTAINMENT - 3.2% MUSIC - 0.8% Warner Music Group 7.375% 04/15/14 (a) 13,055,000 13,838,300 ------------- 13,838,300 RACETRACKS - 1.0% Speedway Motorsports, Inc. 6.750% 06/01/13 16,983,000 17,810,921 ------------- 17,810,921 THEATERS - 1.4% Cinemark USA, Inc. 9.000% 02/01/13 21,740,000 24,267,275 ------------- 24,267,275 ------------- Entertainment Total 55,916,496 HOME BUILDERS - 2.8% BUILDING RESIDENTIAL/COMMERCIAL - 2.8% KB Home 5.875% 01/15/15 7,085,000 7,208,987 7.750% 02/01/10 5,150,000 5,574,875 8.625% 12/15/08 6,325,000 7,163,062 9.500% 02/15/11 5,765,000 6,298,263 Toll Brothers, Inc. 8.250% 02/01/11 3,200,000 3,452,000 Toll Corp. 8.000% 05/01/09 5,765,000 5,988,394 8.250% 12/01/11 12,770,000 14,062,963 ------------- 49,748,544 ------------- Home Builders Total 49,748,544 LEISURE TIME - 2.5% CRUISE LINES - 2.0% Royal Caribbean Cruises Ltd. 6.750% 03/15/08 5,325,000 5,671,125 6.875% 12/01/13 6,275,000 6,855,438 8.750% 02/02/11 18,890,000 22,148,525 ------------- 34,675,088 PAR ($) VALUE ($) ------- ------------- LEISURE & RECREATIONAL PRODUCTS - 0.5% K2, Inc. 7.375% 07/01/14 8,380,000 9,067,160 ------------- 9,067,160 ------------- Leisure Time Total 43,742,248 LODGING - 8.3% CASINO HOTELS - 7.2% Kerzner International, Ltd. 8.875% 08/15/11 7,825,000 8,529,250 MGM Mirage, Inc. 6.000% 10/01/09 30,230,000 30,985,750 9.750% 06/01/07 3,045,000 3,372,337 Park Place Entertainment Corp. 7.875% 03/15/10 12,600,000 14,253,750 8.875% 09/15/08 5,150,000 5,832,375 9.375% 02/15/07 13,475,000 14,721,438 Station Casinos, Inc. 6.500% 02/01/14 20,305,000 21,269,488 6.875% 03/01/16 13,540,000 14,284,700 Wynn Las Vegas LLC 6.625% 12/01/14 (a) 13,830,000 13,864,575 ------------- 127,113,663 HOTELS & MOTELS - 1.1% ITT Corp. 6.750% 11/15/05 800,000 817,000 Starwood Hotels & Resorts Worldwide, Inc. 7.375% 05/01/07 5,300,000 5,631,250 7.875% 05/01/12 11,180,000 12,954,825 ------------- 19,403,075 ------------- Lodging Total 146,516,738 RETAIL - 3.4% CONVENIENCE STORES - 1.0% Couche-Tard 7.500% 12/15/13 16,480,000 17,674,800 ------------- 17,674,800 RETAIL-AUTOMOBILE - 1.4% Autonation, Inc. 9.000% 08/01/08 14,330,000 16,192,900 Group 1 Automotive, Inc. 8.250% 08/15/13 8,045,000 8,487,475 ------------- 24,680,375 RETAIL-PROPANE DISTRIBUTORS - 0.5% Suburban Propane Partners 6.875% 12/15/13 9,675,000 9,916,875 ------------- 9,916,875 124 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia High Yield Fund PAR ($) VALUE ($) ------- ------------- CORPORATE FIXED-INCOME BONDS & NOTES - (CONTINUED) CONSUMER CYCLICAL - (CONTINUED) RETAIL - (CONTINUED) RETAIL-RESTAURANTS - 0.5% Domino's, Inc. 8.250% 07/01/11 7,805,000 8,439,156 ------------- 8,439,156 ------------- Retail Total 60,711,206 ------------- CONSUMER CYCLICAL TOTAL 362,682,669 CONSUMER NON-CYCLICAL - 17.5% BEVERAGES - 3.4% BEVERAGES-NON-ALCOHOLIC - 1.8% Cott Beverages, Inc. 8.000% 12/15/11 29,250,000 31,663,125 ------------- 31,663,125 BEVERAGES-WINE/SPIRITS - 1.6% Constellation Brands, Inc. 8.000% 02/15/08 3,850,000 4,186,875 8.125% 01/15/12 17,585,000 19,167,650 8.625% 08/01/06 5,100,000 5,380,500 ------------- 28,735,025 ------------- Beverages Total 60,398,150 COMMERCIAL SERVICES - 4.3% COMMERCIAL SERVICES - 1.4% Iron Mountain, Inc. 7.750% 01/15/15 7,450,000 7,617,625 8.625% 04/01/13 17,140,000 18,082,700 ------------- 25,700,325 PRIVATE CORRECTIONS - 1.8% Corrections Corp. of America 7.500% 05/01/11 29,400,000 31,274,250 9.875% 05/01/09 275,000 303,875 ------------- 31,578,125 RENTAL AUTO/EQUIPMENT - 1.1% United Rentals, Inc. 7.000% 02/15/14 12,000,000 11,625,000 7.750% 11/15/13 7,005,000 7,040,025 ------------- 18,665,025 ------------- Commercial Services Total 75,943,475 PAR ($) VALUE ($) ------- ------------- HEALTH CARE SERVICES - 6.3% MEDICAL PRODUCTS - 0.9% Fisher Scientific International, Inc. 6.750% 08/15/14 (a) 14,360,000 15,239,550 ------------- 15,239,550 MEDICAL-HMO - 0.7% Coventry Health Care, Inc. 5.875% 01/15/12 (a) 12,825,000 13,113,563 ------------- 13,113,563 MEDICAL-HOSPITALS - 3.8% HCA, Inc. 6.950% 05/01/12 20,555,000 21,728,896 Province Healthcare Co. 7.500% 06/01/13 12,800,000 14,320,000 Triad Hospitals, Inc. 7.000% 05/15/12 24,453,000 26,042,445 7.000% 11/15/13 4,360,000 4,523,500 ------------- 66,614,841 MEDICAL-NURSING HOMES - 0.4% Extendicare Health Services, Inc. 6.875% 05/01/14 5,825,000 5,941,500 9.500% 07/01/10 1,280,000 1,417,600 ------------- 7,359,100 MEDICAL-OUTPATIENT/HOME MEDICAL - 0.5% Select Medical Corp. 7.625% 02/01/15 (a) 8,440,000 8,693,200 ------------- 8,693,200 ------------- Health Care Services Total 111,020,254 HOUSEHOLD PRODUCTS/WARES - 1.3% CONSUMER PRODUCTS-MISCELLANEOUS - 1.3% Scotts Co. 6.625% 11/15/13 21,530,000 22,741,062 ------------- 22,741,062 ------------- Household Products/Wares Total 22,741,062 PHARMACEUTICALS - 2.2% MEDICAL-WHOLESALE DRUG DISTRIBUTION - 0.7% AmerisourceBergen Corp. 7.250% 11/15/12 6,280,000 6,986,500 8.125% 09/01/08 5,985,000 6,643,350 ------------- 13,629,850 See Accompanying Notes to Financial Statements. | 125 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia High Yield Fund PAR ($) VALUE ($) ------- ------------- CORPORATE FIXED-INCOME BONDS & NOTES - (CONTINUED) CONSUMER NON-CYCLICAL - (CONTINUED) PHARMACEUTICALS - (CONTINUED) PHARMACY SERVICES - 1.5% Omnicare, Inc. 6.125% 06/01/13 10,700,000 10,726,750 Series B, 8.125% 03/15/11 14,740,000 15,698,100 ------------- 26,424,850 ------------- Pharmaceuticals Total 40,054,700 ------------- CONSUMER NON-CYCLICAL TOTAL 310,157,641 ENERGY - 14.1% COAL - 3.5% Arch Western Finance LLC 6.750% 07/01/13 28,790,000 29,869,625 Peabody Energy Corp. 5.875% 04/15/16 2,775,000 2,809,687 6.875% 03/15/13 26,655,000 28,920,675 ------------- 61,599,987 ------------- Coal Total 61,599,987 OIL & GAS - 5.6% OIL & GAS DRILLING - 0.9% Pride International, Inc. 7.375% 07/15/14 14,505,000 16,028,025 ------------- 16,028,025 OIL COMPANIES-EXPLORATION & PRODUCTION - 4.7% Chesapeake Energy Corp. 6.375% 06/15/15 (a) 18,735,000 19,765,425 7.500% 09/15/13 10,195,000 11,239,987 7.750% 01/15/15 425,000 468,562 Newfield Exploration Co. 6.625% 09/01/14 (a) 18,940,000 20,384,175 Plains Exploration & Production Co. 7.125% 06/15/14 13,265,000 14,591,500 Pogo Producing Co. 8.250% 04/15/11 3,080,000 3,295,600 Vintage Petroleum, Inc. 7.875% 05/15/11 7,125,000 7,641,563 8.250% 05/01/12 6,025,000 6,642,563 ------------- 84,029,375 ------------- Oil & Gas Total 100,057,400 PAR ($) VALUE ($) ------- ------------- OIL & GAS SERVICES - 3.3% OIL FIELD MACHINERY & EQUIPMENT - 1.8% Grant Prideco, Inc. 9.000% 12/15/09 14,995,000 16,531,987 9.625% 12/01/07 12,720,000 14,151,000 ------------- 30,682,987 OIL-FIELD SERVICES - 1.5% Hornbeck Offshore Services, Inc. 6.125% 12/01/14 (a) 9,975,000 9,999,938 Universal Compression, Inc. 7.250% 05/15/10 16,245,000 17,057,250 ------------- 27,057,188 ------------- Oil & Gas Services Total 57,740,175 PIPELINES - 1.7% MarkWest Energy Partners 6.875% 11/01/14 (a) 8,725,000 8,964,938 William Companies, Inc. 7.125% 09/01/11 1,935,000 2,128,500 8.125% 03/15/12 16,220,000 18,896,300 ------------- 29,989,738 ------------- Pipelines Total 29,989,738 ------------- ENERGY TOTAL 249,387,300 FINANCIALS - 0.9% REAL ESTATE INVESTMENT TRUSTS - 0.9% REAL ESTATE INVESTMENT TRUSTS-DIVERSIFIED - 0.9% iStar Financial, Inc., REIT Series B, 5.125% 04/01/11 7,350,000 7,343,679 7.000% 03/15/08 7,900,000 8,386,956 ------------- 15,730,635 ------------- Real Estate Investment Trusts Total 15,730,635 ------------- FINANCIALS TOTAL 15,730,635 INDUSTRIALS - 15.9% AEROSPACE & DEFENSE - 2.9% AEROSPACE/DEFENSE-EQUIPMENT - 0.9% TransDigm, Inc. 8.375% 07/15/11 15,710,000 16,770,425 ------------- 16,770,425 ELECTRONICS-MILITARY - 2.0% L-3 Communications Corp. 6.125% 07/15/13 1,855,000 1,908,331 7.625% 06/15/12 30,275,000 32,999,750 ------------- 34,908,081 ------------- Aerospace & Defense Total 51,678,506 126 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia High Yield Fund PAR ($) VALUE ($) ------- ------------- CORPORATE FIXED-INCOME BONDS & NOTES - (CONTINUED) INDUSTRIALS - (CONTINUED) ENVIRONMENTAL CONTROL - 1.5% ALTERNATIVE WASTE TECHNOLOGY - 0.5% Synagro Technologies, Inc. 9.500% 04/01/09 8,375,000 9,170,625 ------------- 9,170,625 NON-HAZARDOUS WASTE DISPOSAL - 1.0% Allied Waste North America, Inc. 6.375% 04/15/11 7,535,000 7,346,625 6.500% 11/15/10 7,875,000 7,756,875 Series B, 9.250% 09/01/12 2,075,000 2,292,875 ------------- 17,396,375 ------------- Environmental Control Total 26,567,000 HAND/MACHINE TOOLS - 0.9% MACHINE TOOLS & RELATED PRODUCTS - 0.9% Kennametal, Inc. 7.200% 06/15/12 15,195,000 16,864,171 ------------- 16,864,171 ------------- Hand/Machine Tools Total 16,864,171 MACHINERY DIVERSIFIED - 1.1% MACHINERY-GENERAL INDUSTRY - 1.1% Manitowoc Co., Inc. 7.125% 11/01/13 1,315,000 1,420,200 Westinghouse Air Brake Technologies Corp. 6.875% 07/31/13 16,475,000 17,339,938 ------------- 18,760,138 ------------- Machinery Diversified Total 18,760,138 PACKAGING & CONTAINERS - 6.4% CONTAINERS-METAL/GLASS - 5.0% Ball Corp. 6.875% 12/15/12 32,897,000 35,035,305 7.750% 08/01/06 2,850,000 2,981,812 Owens-Brockway Glass Container 6.750% 12/01/14 (a) 3,875,000 3,971,875 8.875% 02/15/09 7,225,000 7,821,063 Owens-Illinois, Inc. 7.500% 05/15/10 13,500,000 14,276,250 Silgan Holdings, Inc. 6.750% 11/15/13 22,380,000 23,163,300 ------------- 87,249,605 PAR ($) VALUE ($) ------- ------------- CONTAINERS-PAPER/PLASTIC - 1.4% Smurfit-Stone Container Corp. 7.375% 07/15/14 8,450,000 8,830,250 8.250% 10/01/12 4,505,000 4,876,662 8.375% 07/01/12 5,185,000 5,612,763 9.750% 02/01/11 5,425,000 5,913,250 ------------- 25,232,925 ------------- Packaging & Containers Total 112,482,530 TRANSPORTATION - 3.1% TRANSPORT-MARINE - 1.9% Teekay Shipping Corp. 8.875% 07/15/11 29,776,000 34,465,720 ------------- 34,465,720 TRANSPORT-SERVICES - 1.2% Offshore Logistics, Inc. 6.125% 06/15/13 20,800,000 20,904,000 ------------- 20,904,000 ------------- Transportation Total 55,369,720 ------------- INDUSTRIALS TOTAL 281,722,065 TECHNOLOGY - 1.1% SEMICONDUCTORS - 1.1% ELECTRONIC COMPONENTS-SEMICONDUCTORS - 1.1% Freescale Semiconductor, Inc. 6.875% 07/15/11 18,430,000 19,812,250 ------------- 19,812,250 ------------- Semiconductors Total 19,812,250 ------------- TECHNOLOGY TOTAL 19,812,250 UTILITIES - 2.4% ELECTRIC - 2.4% ELECTRIC-GENERATION - 1.8% AES Corp. 7.750% 03/01/14 14,130,000 15,631,312 Texas Genco LLC 6.875% 12/15/14 (a) 15,790,000 16,776,875 ------------- 32,408,187 ELECTRIC-INTEGRATED - 0.6% Nevada Power Co. 5.875% 01/15/15 (a) 5,000,000 5,087,500 6.500% 04/15/12 3,950,000 4,187,000 Northwestern Corp. 5.875% 11/01/14 (a) 975,000 992,063 ------------- 10,266,563 ------------- Electric Total 42,674,750 ------------- UTILITIES TOTAL 42,674,750 Total Corporate Fixed-Income Bonds & Notes (Cost of $1,576,788,206) 1,634,287,951 See Accompanying Notes to Financial Statements. | 127 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia High Yield Fund PAR ($) VALUE ($) ------- ------------- SHORT-TERM OBLIGATION - 6.4% Repurchase agreement with State Street Bank & Trust Co., dated 02/28/05, due 03/01/05 at 2.500%, collateralized by a U.S. Treasury Note maturing 09/30/06, market value of $114,839,017 (repurchase proceeds $112,590,818) 112,583,000 112,583,000 ------------- Total Short-Term Obligation (Cost of $112,583,000) 112,583,000 TOTAL INVESTMENTS - 98.7% (COST OF $1,689,371,206) (B) 1,746,870,951 OTHER ASSETS & LIABILITIES, NET - 1.3% 23,337,612 NET ASSETS - 100.0% 1,770,208,563 NOTES TO INVESTMENT PORTFOLIO: (a) Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. At February 28, 2005, these securities amounted to $241,526,123, which represents 13.6% of net assets. (b) Cost for federal income tax purposes is $1,697,231,933. At February 28, 2005, the Fund held investments in the following sectors: % OF SECTOR NET ASSETS ---------------------------------------------------------------- Consumer Cyclical 20.5% Consumer Non-Cyclical 17.5 Industrials 15.9 Communications 14.8 Energy 14.1 Basic Materials 5.1 Utilities 2.4 Technology 1.1 Financials 0.9 Short-Term Obligation 6.4 Other Assets & Liabilities, Net 1.3 ----- 100.0% ===== ACRONYM NAME ------- ---- REIT Real Estate Investment Trust 128 | See Accompanying Notes to Financial Statements. INVESTMENT PORTFOLIO ___________________________________________________________ February 28, 2005 (Unaudited) Columbia Daily Income Company PAR ($) VALUE ($) ------- ------------- CORPORATE FIXED-INCOME BONDS & NOTES - 37.7% CONSUMER CYCLICAL - 0.2% AUTO MANUFACTURERS - 0.2% Toyota Motor Credit Corp. 2.635% 03/17/05 (a) 1,000,000 1,000,047 ------------- Auto Manufacturers Total 1,000,047 ------------- CONSUMER CYCLICAL TOTAL 1,000,047 CONSUMER NON-CYCLICAL - 0.9% PHARMACEUTICALS - 0.9% Pfizer, Inc. 2.690% 11/04/05 (a) 5,000,000 4,997,750 ------------- Pharmaceuticals Total 4,997,750 ------------- CONSUMER NON-CYCLICAL TOTAL 4,997,750 FINANCIALS - 36.6% COMMERCIAL BANKS - 7.5% First Tennessee Bank 2.750% 05/03/05 (a) 15,000,000 15,000,522 US Bank NA 2.770% 02/17/06 (a) 9,000,000 8,999,930 Wells Fargo & Co.: 2.570% 03/24/05 (a) 7,000,000 7,000,422 2.579% 09/29/05 (a) 10,000,000 10,003,343 ------------- Commercial Banks Total 41,004,217 DIVERSIFIED FINANCIAL SERVICES - 29.1% 500 Thomas Moore Building LLC LOC: Fifth Third Bank 2.700% 06/01/22 (a) 1,105,000 1,105,000 American Express Credit Corp. 2.600% 06/15/05 (a) 4,000,000 4,000,316 2.600% 08/09/05 (a) 5,000,000 5,000,621 American Made LLC LOC: National City Bank 2.680% 12/01/24 (a) 6,300,000 6,300,000 Beckfield Properties LLC LOC: Fifth Third Bank 2.700% 12/01/24 (a) 1,000,000 1,000,000 Bedford Hills Golf Club, Inc. LOC: Fifth Third Bank 2.700% 04/01/13 (a) 1,000,000 1,000,000 CC USA, Inc. 2.398% 12/02/05 (a)(b) 5,000,000 4,998,958 Central Avenue Properties Ltd. LOC: Fifth Third Bank 2.700% 11/01/23 (a) 1,225,000 1,225,000 Central Ohio Medical Textiles LOC: National City Bank 2.640% 03/01/23 (a) 13,500,000 13,500,000 PAR ($) VALUE ($) ------- ------------- Central Supply Co. LOC: Fifth Third Bank 2.700% 08/01/23 (a) 2,000,000 2,000,000 Chagrin Valley Partners LLC LOC: Fifth Third Bank 2.700% 11/01/13 (a) 1,080,000 1,080,000 Citigroup, Inc. 2.900% 05/19/05 (a) 15,000,000 15,001,919 Crestmont Nursing Home LOC: Fifth Third Bank 2.650% 03/01/24 (a) 1,465,000 1,465,000 DiGerinomo Aggregates LOC: National City Bank 2.680% 01/01/15 (a) 5,600,000 5,600,000 Falls Village Realty LLC LOC: Fifth Third Bank 2.700% 12/01/29 (a) 2,000,000 2,000,000 Fresh Unlimited, Inc. LOC: Fifth Third Bank 2.700% 11/01/44 (a) 1,000,000 1,000,000 General Electric Capital Corp.: 2.615% 03/15/05 (a) 7,932,000 7,932,587 7.500% 05/15/05 5,564,000 5,619,588 Grand Rapids Christian School LOC: Fifth Third Bank 2.700% 09/01/28 (a) 4,120,000 4,120,000 Harlan Development Co.: LOC: Fifth Third Bank 2.700% 12/01/23 (a) 6,960,000 6,960,000 Harrier Finance Funding LLC 2.660% 10/25/05 (a)(b) 10,000,000 10,000,000 Holten Meat, Inc. LOC: US Bank NA 2.630% 05/01/25 (a) 6,475,000 6,475,000 Keating Muething & Klekamp LOC: Fifth Third Bank 2.700% 11/01/24 (a) 1,000,000 1,000,000 Lehmann Property Group LOC: Fifth Third Bank 2.700% 07/01/22 (a) 1,460,000 1,460,000 LRC Meadows Investors LLC 2.750% 12/01/34 (a) 1,300,000 1,300,000 LTC Investors LLC LOC: National City Bank 2.700% 11/01/24 (a) 2,320,000 2,320,000 Materials Processing, Inc. LOC: Fifth Third Bank 2.700% 09/01/34 (a) 905,000 905,000 R.O. Davis Real Estate LLC LOC: Fifth Third Bank 2.700% 04/01/23 (a) 1,000,000 1,000,000 RDV Finance LLC LOC: Fifth Third Bank 2.650% 10/01/39 (a) 3,000,000 3,000,000 See Accompanying Notes to Financial Statements. | 129 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Daily Income Company PAR ($) VALUE ($) ------- ------------- CORPORATE FIXED-INCOME BONDS & NOTES - (CONTINUED) FINANCIALS - (CONTINUED) DIVERSIFIED FINANCIAL SERVICES - (CONTINUED) Scott Street Land Co. LOC: Fifth Third Bank 2.700% 01/03/22 (a) 940,000 940,000 Skeletal Properties LLC LOC: Fifth Third Bank 2.700% 06/01/34 (a) 1,000,000 1,000,000 Spartan Medical Facility LOC: Fifth Third Bank 2.700% 12/01/26 (a) 1,500,000 1,500,000 Sumner Medical Plaza LLC LOC: Fifth Third Bank 2.700% 10/01/10 (a) 3,470,000 3,470,000 Tango Finance Corp. 2.650% 01/17/06 (a)(b) 10,000,000 10,001,120 Titan Holdings Group LLC LOC: Fifth Third Bank 2.700% 05/01/12 (a) 1,655,000 1,655,000 Union Hospital, Inc. LOC: Fifth Third Bank 2.700% 09/01/25 (a) 2,150,000 2,150,000 Vancouver Clinic Building LLC LOC: US Bank NA 2.630% 02/01/25 (a) 5,000,000 5,000,000 Whistlejacket Capital Ltd. 2.550% 10/14/05 (a)(b) 5,000,000 4,998,935 White Pine Finance LLC 2.393% 09/07/05 (a)(b) 10,000,000 9,997,929 ------------- Diversified Financial Services Total 159,081,973 ------------- FINANCIALS TOTAL 200,086,190 Total Corporate Fixed-Income Bonds & Notes (Cost of $206,083,987) 206,083,987 MUNICIPAL BONDS - 25.2% ALASKA - 0.8% AK Four Dam Pool Electric Revenue Series B, LOC: Dexia Credit Local 2.600% 07/01/26 (a) 4,250,000 4,250,000 ------------- ALASKA TOTAL 4,250,000 CALIFORNIA - 7.7% CA Abag Finance Authority for Nonprofit Corps. Multifamily Revenue Fine Arts Building Apartments, Series 2002 A, LOC: FNMA 2.580% 07/15/35 (a) 3,800,000 3,800,000 PAR ($) VALUE ($) ------- ------------- CA Educational Facilities Authority Revenue University Judaism, Series B, LOC: Allied Irish Bank 2.720% 12/01/28 (a) 6,000,000 6,000,000 CA San Diego Metropolitan Transportation Development Board Pension Obligation Revenue, Series B, Insured: MBIA, SPA: Dexia Credit Local 2.570% 12/01/33 (a) 17,595,000 17,595,000 CA San Jose Redevelopment Agency Revenue Merged Area, Series H, LOC: Bank of New York 2.600% 08/01/29 (a) 14,600,000 14,600,000 ------------- CALIFORNIA TOTAL 41,995,000 COLORADO - 3.8% CO Housing & Finance Authority Single Family Class Revenue, Class I-B1, SPA: Dexia Credit Local 2.570% 11/01/34 (a) 21,000,000 21,000,000 ------------- COLORADO TOTAL 21,000,000 FLORIDA - 1.4% FL Homestead Special Obligation Revenue Speedway Project, LOC: Suntrust Bank 2.590% 11/01/18 (a) 6,665,000 6,665,000 FL Housing Finance Corp. Revenue Waterford Pointe, Series E-2, LOC: FNMA 2.770% 02/15/33 (a) 1,150,000 1,150,000 ------------- FLORIDA TOTAL 7,815,000 GEORGIA - 0.2% GA Burke County Industrial Development Authority Revenue Fleetguard, Inc. Project, LOC: Fifth Third Bank 2.700% 08/01/18 (a) 925,000 925,000 ------------- GEORGIA TOTAL 925,000 INDIANA - 0.5% IN First Pentecostal Church, Inc. Noblesville Revenue, LOC: JPMorgan Chase Bank 2.650% 11/01/26 (a) 1,620,000 1,620,000 130 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Daily Income Company PAR ($) VALUE ($) ------- ------------- MUNICIPAL BONDS - (CONTINUED) INDIANA - (CONTINUED) IN Industrial Development Authority Revenue Lawrence Utilities, Series 2003 B, LOC: Fifth Third Bank 2.720% 07/01/23 (a) 1,000,000 1,000,000 ------------- INDIANA TOTAL 2,620,000 MARYLAND - 2.0% MD Baltimore Project Revenue Baltimore Parking Facilities Series 2002 Insured: FGIC SPA: Dexia Credit Local 2.620% 07/01/32 (a) 11,000,000 11,000,000 ------------- MARYLAND TOTAL 11,000,000 MASSACHUSETTS - 1.3% MA State Housing Finance Agency Revenue Avalon Upper Falls LLC Series 2004 A LOC: JP MorganChase Bank 2.570% 12/01/34 (a) 6,800,000 6,800,000 ------------- MASSACHUSETTS TOTAL 6,800,000 MICHIGAN - 2.7% MI Oakland County 1.625% 05/01/05 15,000,000 14,975,516 ------------- MICHIGAN TOTAL 14,975,516 PENNSYLVANIA - 2.5% PA Donegal Crossing LLC LOC: Federal Home Loan Bank 2.720% 08/15/27 (a) 13,615,000 13,615,000 ------------- PENNSYLVANIA TOTAL 13,615,000 TEXAS - 2.3% TX Harris County Houston Texas Sports Authority Special Revenue Series E, Insured: MBIA, SPA: JPMorgan Chase Bank 2.600% 11/15/30 (a) 12,600,000 12,600,000 ------------- TEXAS TOTAL 12,600,000 Total Municipal Bonds (Cost of $137,595,516) 137,595,516 PAR ($) VALUE ($) ------- ------------- COMMERCIAL PAPER - 23.1% Brahms Funding Corp. 2.700% 03/01/05 (b) 10,303,000 10,303,000 Cancara Asset Securitisation LLC 2.740% 05/18/05 (b) 7,000,000 6,958,443 CC U.S.A., Inc. 2.740% 05/18/05 (b) 5,000,000 4,970,317 Giro Balanced Funding Corp. 2.370% 03/07/05 (b) 15,000,000 14,994,075 Grampian Holdings PLC 2.860% 06/30/05 (b) 8,000,000 7,923,098 Greenwich Capital Holdings 2.550% 04/08/05 (a) 10,000,000 10,000,000 Harrier Group PLC 2.720% 06/10/05 (b) 8,000,000 7,938,951 Mane Funding Corp. 2.540% 04/07/05 (b) 5,000,000 4,986,947 Premier Asset Management PLC 2.350% 03/01/05 (b) 10,000,000 10,000,000 Sigma Finance, Inc. 2.370% 03/01/05 (b) 20,000,000 20,000,000 Thames Asset Global Securitisation LLC 2.390% 03/09/05 (b) 15,000,000 14,992,033 Whistlejacket Capital Ltd. 2.540% 04/15/05 (b) 5,000,000 4,999,818 White Pine Finance LLC 2.500% 05/03/05 (b) 8,000,000 7,965,000 ------------- Total Commercial Paper (Cost of $126,031,682) 126,031,682 CERTIFICATES OF DEPOSIT - 9.9% Canadian Imperial Bank of Commerce 2.535% 06/08/05 (a) 15,000,000 14,999,295 CS First Boston 2.569% 12/29/05 (a) 8,000,000 8,001,640 JPMorgan Chase & Co. 3.120% 05/20/05 (a) 6,000,000 6,004,041 Landesbank Baden-Wuerttemberg Girozentrale 2.610% 03/29/05 (a) 15,000,000 14,999,825 Unicredito Italiano S.p.A. 2.630% 07/27/05 (a) 10,000,000 9,997,278 ------------- Total Certificates of Deposit (Cost of $54,002,079) 54,002,079 See Accompanying Notes to Financial Statements. | 131 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Daily Income Company PAR ($) VALUE ($) ------- ------------- U.S. GOVERNMENT AGENCIES - 4.1% Federal National Mortgage Association (FNMA): 2.460% 03/23/05 (a) 2,500,000 2,499,995 2.430% 10/03/05 (a) 20,000,000 19,989,764 ------------- Total U.S. Government Agencies (Cost of $22,489,759) 22,489,759 TOTAL INVESTMENTS - 100.0% (COST OF $546,203,023) (C) 546,203,023 OTHER ASSETS & LIABILITIES, NET - 0.0% 5,996 NET ASSETS - 100.0% 546,209,019 NOTES TO INVESTMENT PORTFOLIO: (a) Floating rate note. The interest rate shown reflects the rate as of February 28, 2005. (b) Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. At February 28, 2005, these securities amounted to $156,028,624, which represents 28.6% of net assets. (c) Cost for federal income tax purposes is $546,203,023. ACRONYM NAME ------- ---- FGIC Financial Guaranty Insurance Co. FNMA Federal National Mortgage Association MBIA MBIA Insurance Corp. LOC Letter of Credit SPA Standby Purchase Agreement 132 | See Accompanying Notes to Financial Statements. This page intentionally left blank. STATEMENTS OF ASSETS AND LIABILITIES ___________________________________________ February 28, 2005 (Unaudited) Columbia Funds
COMMON INTERNATIONAL MID CAP SMALL CAP STOCK GROWTH STOCK GROWTH GROWTH FUND ($) FUND ($) FUND ($) FUND ($) FUND ($) -------------- -------------- -------------- -------------- -------------- ASSETS Unaffiliated investments, at identified cost (including short-term obligations) 198,193,246 631,338,598 565,225,710 741,891,108 249,783,973 Affiliated investments, at identified cost -- -- -- -- -- -------------- -------------- -------------- -------------- -------------- Total investments, at identified cost 198,193,246 631,338,598 565,225,710 741,891,108 249,783,973 -------------- -------------- -------------- -------------- -------------- Unaffiliated investments, at value 220,274,723 722,478,286 669,234,410 861,110,174 261,351,914 Affiliated investments, at value -- -- -- -- -- Repurchase agreement 525,000 -- 7,878,000 2,316,000 11,948,000 -------------- -------------- -------------- -------------- -------------- Total investments, at value 220,799,723 722,478,286 677,112,410 863,426,174 273,299,914 Cash 66 -- 359 857 978,750 Foreign currency (cost of $80,836 and $1,487, respectively) -- -- 80,887 1,497 -- Receivable for: Investments sold 12,862,053 28,947,899 6,849,194 1,894,583 4,401,610 Capital stock sold 236,158 292,795 695,077 598,986 304,064 Interest 36 -- 547 161 830 Dividends 278,865 851,019 872,501 204,783 28,162 Futures variation margin -- -- -- -- -- Foreign tax reclaim -- -- 166,930 -- -- Expense reimbursement due from Investment Advisor -- -- -- -- -- Deferred compensation plan 3,250 14,170 3,791 15,499 3,726 Other assets 157,834 449,449 5,926 953,333 2,952 -------------- -------------- -------------- -------------- -------------- Total assets 234,337,985 753,033,618 685,787,622 867,095,873 279,020,008 -------------- -------------- -------------- -------------- -------------- LIABILITIES Expense reimbursement due to Investment Advisor -- -- -- -- -- Payable to custodian bank -- 4,155,863 -- -- -- Payable for: Investments purchased 301,933 5,467,005 6,464,016 -- 6,688,433 Capital stock redeemed 5,642,768 5,065,507 757,117 1,273,722 10,024,581 Distributions -- -- -- -- -- Investment advisory fee 115,982 357,768 435,750 524,137 185,167 Transfer agent fee 129,102 255,348 42,647 196,278 102,427 Pricing and bookkeeping fees 16,392 11,144 8,849 11,497 9,816 Merger fees -- -- 17,775 -- -- Directors' fees -- -- -- 2,136 696 Audit fee 20,390 21,426 15,247 14,794 16,944 Service and distribution fees 2,028 5,299 14,697 13,433 -- Custody fee 7,878 -- 18,266 2,893 6,694 Legal fee 901 2,373 -- 7,096 4,831 Registration fees 24,528 -- -- 24,338 19,775 Reports to shareholders 24,092 44,670 45,234 105,771 29,605 Deferred compensation plan 3,250 14,170 3,791 15,499 3,726 -------------- -------------- -------------- -------------- -------------- Total liabilities 6,289,244 15,400,573 7,823,389 2,191,594 17,092,695 NET ASSETS 228,048,741 737,633,045 677,964,233 864,904,279 261,927,313 -------------- -------------- -------------- -------------- -------------- NET ASSETS CONSIST OF Paid-in capital 248,764,571 915,183,202 564,922,546 798,692,334 246,240,406 Undistributed (overdistributed) net investment income 182,214 512,736 84,031 -- -- Accumulated net investment loss -- -- -- (2,905,359) (1,932,697) Accumulated net realized gain (loss) (43,504,521) (269,202,581) 1,050,482 (52,417,772) (5,896,337) Unrealized appreciation (depreciation) on: Investments 22,606,477 91,139,688 111,886,700 121,535,066 23,515,941 Foreign currency translations -- -- 20,474 10 -- Futures contracts -- -- -- -- -- -------------- -------------- -------------- -------------- -------------- NET ASSETS 228,048,741 737,633,045 677,964,233 864,904,279 261,927,313
134 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ Columbia Funds
REAL ESTATE STRATEGIC SHORT TERM EQUITY TECHNOLOGY INVESTOR BALANCED BOND FUND ($) FUND ($) FUND ($) FUND ($) FUND ($) -------------- -------------- -------------- -------------- -------------- ASSETS Unaffiliated investments, at identified cost (including short-term obligations) 556,822,089 39,654,151 409,297,524 365,742,813 491,554,393 Affiliated investments, at identified cost -- -- -- -- 1,896,055 -------------- -------------- -------------- -------------- -------------- Total investments, at identified cost 556,822,089 39,654,151 409,297,524 365,742,813 493,450,448 -------------- -------------- -------------- -------------- -------------- Unaffiliated investments, at value 853,479,105 43,773,466 388,334,326 375,760,829 470,456,318 Affiliated investments, at value -- -- -- -- 1,851,535 Repurchase agreement 18,963,000 1,191,000 109,912,000 10,198,000 18,401,000 -------------- -------------- -------------- -------------- -------------- Total investments, at value 872,442,105 44,964,466 498,246,326 385,958,829 490,708,853 Cash 921 191 225 323 596 Foreign currency (cost of $80,836 and $1,487, respectively) -- -- -- -- -- Receivable for: Investments sold 4,188,919 1,586,090 4,424,847 1,009,754 -- Capital stock sold 1,052,348 490,760 1,852,069 715,475 1,106,692 Interest 1,317 83 7,633 1,149,534 3,281,788 Dividends 724,253 7,344 469,394 273,586 -- Futures variation margin -- -- -- 7,657 53,594 Foreign tax reclaim -- -- 13,910 -- -- Expense reimbursement due from Investment Advisor -- -- -- -- -- Deferred compensation plan 5,138 2,168 13,483 3,650 10,855 Other assets 15,232 1,972 1,607 107,919 9,897 -------------- -------------- -------------- -------------- -------------- Total assets 878,430,233 47,053,074 505,029,494 389,226,727 495,172,275 -------------- -------------- -------------- -------------- -------------- LIABILITIES Expense reimbursement due to Investment Advisor -- 16,194 -- -- 16,455 Payable to custodian bank -- -- -- -- -- Payable for: Investments purchased 1,797,842 3,152,118 2,799,041 418,061 -- Capital stock redeemed 2,016,431 177,193 613,811 3,229,059 823,048 Distributions -- -- -- -- 789,058 Investment advisory fee 516,692 28,825 281,097 157,209 160,434 Transfer agent fee 135,647 26,538 58,385 155,555 86,699 Pricing and bookkeeping fees 12,053 4,767 3,949 23,545 14,202 Merger fees -- -- -- -- -- Directors' fees 2,725 -- 237 -- -- Audit fee 9,999 16,200 14,892 23,570 21,194 Service and distribution fees 26,143 4,689 76,551 8,154 38,658 Custody fee 4,024 3,626 1,066 1,903 5,965 Legal fee 1,883 871 1,754 -- -- Registration fees 13,199 27,992 8,966 18,449 46,550 Reports to shareholders 85,733 8,998 29,581 18,333 7,179 Deferred compensation plan 5,138 2,168 13,483 3,650 10,855 -------------- -------------- -------------- -------------- -------------- Total liabilities 4,627,509 3,470,179 3,902,813 4,057,488 2,020,297 NET ASSETS 873,802,724 43,582,895 501,126,681 385,169,239 493,151,978 -------------- -------------- -------------- -------------- -------------- NET ASSETS CONSIST OF Paid-in capital 512,545,848 37,058,894 396,023,071 405,858,038 497,149,481 Undistributed (overdistributed) net investment income (1,442,510) -- 200,441 990,024 284,936 Accumulated net investment loss -- (336,464) -- -- -- Accumulated net realized gain (loss) 47,079,370 1,550,982 15,953,031 (41,900,308) (1,579,125) Unrealized appreciation (depreciation) on: Investments 315,620,016 5,310,315 88,948,802 20,216,016 (2,741,595) Foreign currency translations -- (832) 1,336 -- -- Futures contracts -- -- -- 5,469 38,281 -------------- -------------- -------------- -------------- -------------- NET ASSETS 873,802,724 43,582,895 501,126,681 385,169,239 493,151,978
FIXED NATIONAL OREGON INCOME MUNICIPAL MUNICIPAL DAILY SECURITIES BOND BOND HIGH YIELD INCOME FUND ($) FUND ($) FUND ($) FUND ($) COMPANY ($) -------------- -------------- -------------- -------------- -------------- ASSETS Unaffiliated investments, at identified cost (including short-term obligations) 277,958,063 10,191,310 400,544,632 1,689,371,206 546,203,023 Affiliated investments, at identified cost -- -- -- -- -- -------------- -------------- -------------- -------------- -------------- Total investments, at identified cost 277,958,063 10,191,310 400,544,632 1,689,371,206 546,203,023 -------------- -------------- -------------- -------------- -------------- Unaffiliated investments, at value 276,066,461 10,651,523 421,071,925 1,634,287,951 546,203,023 Affiliated investments, at value -- -- -- -- -- Repurchase agreement 5,397,000 -- -- 112,583,000 -- -------------- -------------- -------------- -------------- -------------- Total investments, at value 281,463,461 10,651,523 421,071,925 1,746,870,951 546,203,023 Cash 491 22,641 32,169 3,110,323 35,150 Foreign currency (cost of $80,836 and $1,487, respectively) -- -- -- -- -- Receivable for: Investments sold -- 940,841 842,975 -- -- Capital stock sold 268,440 2,450 129,885 2,524,488 1,817,743 Interest 2,215,785 133,568 4,933,212 29,118,465 1,270,315 Dividends -- -- -- -- -- Futures variation margin 14,219 -- -- -- -- Foreign tax reclaim -- -- -- -- -- Expense reimbursement due from Investment Advisor -- 21,646 -- -- -- Deferred compensation plan 3,849 1,004 4,010 8,213 4,493 Other assets 7,117 3,300 2,125 21,692 163,344 -------------- -------------- -------------- -------------- -------------- Total assets 283,973,362 11,776,973 427,016,301 1,781,654,132 549,494,068 -------------- -------------- -------------- -------------- -------------- LIABILITIES Expense reimbursement due to Investment Advisor -- -- -- -- -- Payable to custodian bank -- -- -- -- -- Payable for: Investments purchased -- -- -- 3,234,272 -- Capital stock redeemed 542,296 752,563 659,206 2,750,824 2,785,003 Distributions -- 9,958 344,363 4,064,268 -- Investment advisory fee 113,589 4,781 166,048 739,673 213,445 Transfer agent fee 141,099 4,490 39,801 211,706 188,904 Pricing and bookkeeping fees 12,696 6,645 14,226 13,589 13,013 Merger fees -- -- -- -- -- Directors' fees -- -- 4,986 1,411 -- Audit fee 20,560 18,130 15,825 16,569 20,014 Service and distribution fees 8,562 1,393 2,662 259,058 -- Custody fee 2,883 1,504 3,238 5,971 5,014 Legal fee 2,588 1,732 5,638 3,896 -- Registration fees 13,659 17,886 26,530 43,133 31,693 Reports to shareholders 57,009 4,555 14,575 92,986 23,470 Deferred compensation plan 3,849 1,004 4,010 8,213 4,493 -------------- -------------- -------------- -------------- -------------- Total liabilities 918,790 824,641 1,301,108 11,445,569 3,285,049 NET ASSETS 283,054,572 10,952,332 425,715,193 1,770,208,563 546,209,019 -------------- -------------- -------------- -------------- -------------- NET ASSETS CONSIST OF Paid-in capital 278,948,666 10,390,500 405,721,612 1,730,539,231 546,209,725 Undistributed (overdistributed) net investment income (1,144,058) 5,407 163,207 (12,628,636) -- Accumulated net investment loss -- -- -- -- -- Accumulated net realized gain (loss) 1,734,410 96,212 (696,919) (5,201,777) (706) Unrealized appreciation (depreciation) on: Investments 3,505,398 460,213 20,527,293 57,499,745 -- Foreign currency translations -- -- -- -- -- Futures contracts 10,156 -- -- -- -- -------------- -------------- -------------- -------------- -------------- NET ASSETS 283,054,572 10,952,332 425,715,193 1,770,208,563 546,209,019
See Accompanying Notes to Financial Statements. | 135 STATEMENTS OF ASSETS AND LIABILITIES ___________________________________________ February 28, 2005 (Unaudited) Columbia Funds
COMMON INTERNATIONAL MID CAP SMALL CAP STOCK GROWTH STOCK GROWTH GROWTH FUND ($) FUND ($) FUND ($) FUND ($) FUND ($) -------------- -------------- -------------- -------------- -------------- CLASS A Net assets 802,303 4,850,503 27,675,071 5,546,753 -- Shares outstanding 40,571 174,755 1,806,672 269,337 -- Net asset value per share (a)(b) 19.78 27.76 15.32 20.59 -- Maximum sales charge 5.75% 5.75% 5.75% 5.75% -- Maximum offering price per share (c) 20.99 29.45 16.25 21.85 -- -------------- -------------- -------------- -------------- -------------- CLASS B Net assets 2,102,495 2,386,824 11,316,896 5,912,508 -- Shares outstanding 107,407 87,250 754,575 292,245 -- Net asset value and offering price per share (a)(b) 19.58 27.36 15.00 20.23 -- -------------- -------------- -------------- -------------- -------------- CLASS C Net assets 49,564 293,882 621,545 566,252 -- Shares outstanding 2,531 10,768 41,285 27,930 -- Net asset value and offering price per share (a)(b) 19.58 27.29 15.05 20.27 -- -------------- -------------- -------------- -------------- -------------- CLASS D Net assets 122,693 119,322 749,574 538,665 -- Shares outstanding 6,271 4,358 49,607 26,596 -- Net asset value and offering price per share (a)(b) 19.57 27.38 15.11 20.25 -- -------------- -------------- -------------- -------------- -------------- CLASS G Net assets -- 13,330,906 -- 734,181 -- Shares outstanding -- 486,555 -- 36,391 -- Net asset value and offering price per share (a) -- 27.40 -- 20.17 -- -------------- -------------- -------------- -------------- -------------- CLASS T Net assets -- -- -- 28,306,653 -- Shares outstanding -- -- -- 1,371,801 -- Net asset value per share (a) -- -- -- 20.63 -- Maximum sales charge -- -- -- 5.75% -- Maximum offering price per share (c) -- -- -- 21.89 -- -------------- -------------- -------------- -------------- -------------- CLASS Z Net assets 224,971,686 716,651,608 637,601,147 823,299,267 261,927,313 Shares outstanding 11,372,995 25,642,947 41,443,170 39,582,462 10,427,604 Net asset value and offering price per share (b) 19.78 27.95 15.38 20.80 25.12
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge. (b) Redemption price per share is equal to net asset value less any applicable redemption fees. (c) On sales of $50,000 or more the offering price is reduced. 136 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ Columbia Funds
REAL ESTATE STRATEGIC SHORT TERM EQUITY TECHNOLOGY INVESTOR BALANCED BOND FUND ($) FUND ($) FUND ($) FUND ($) FUND ($) ------------- ------------- ------------- ------------- ------------- CLASS A Net assets 40,331,554 7,287,061 143,707,286 2,905,507 24,088,676 Shares outstanding 1,598,930 931,221 7,012,583 138,284 2,808,486 Net asset value per share (a)(b) 25.22 7.83 20.49 21.01 8.58 Maximum sales charge 5.75% 5.75% 5.75% 5.75% 4.75% Maximum offering price per share (c) 26.76 8.31 21.74 22.29 9.01 -------------- -------------- -------------- -------------- -------------- CLASS B Net assets 13,534,492 2,831,410 38,294,306 7,836,882 22,109,335 Shares outstanding 536,336 368,983 1,894,328 373,499 2,577,733 Net asset value and offering price per share (a)(b) 25.24 7.67 20.22 20.98 8.58 -------------- -------------- -------------- -------------- -------------- CLASS C Net assets 3,786,592 1,390,240 30,184,805 841,699 3,121,237 Shares outstanding 150,166 180,782 1,492,568 40,111 363,904 Net asset value and offering price per share (a)(b) 25.22 7.69 20.22 20.98 8.58 -------------- -------------- -------------- -------------- -------------- CLASS D Net assets 4,280,182 21,463 650,230 328,820 7,599,789 Shares outstanding 169,646 2,780 32,175 15,675 886,066 Net asset value and offering price per share (a)(b) 25.23 7.72 20.21 20.98 8.58 -------------- -------------- -------------- -------------- -------------- CLASS G Net assets -- -- -- -- 881,426 Shares outstanding -- -- -- -- 102,766 Net asset value and offering price per share (a) -- -- -- -- 8.58 -------------- -------------- -------------- -------------- -------------- CLASS T Net assets -- -- -- -- 19,465,624 Shares outstanding -- -- -- -- 2,269,504 Net asset value per share (a) -- -- -- -- 8.58 Maximum sales charge -- -- -- -- 4.75% Maximum offering price per share (c) -- -- -- -- 9.01 -------------- -------------- -------------- -------------- -------------- CLASS Z Net assets 811,869,904 32,052,721 288,290,054 373,256,331 415,885,891 Shares outstanding 32,168,410 4,061,584 14,045,432 17,776,786 48,488,676 Net asset value and offering price per share (b) 25.24 7.89 20.53 21.00 8.58
FIXED NATIONAL OREGON INCOME MUNICIPAL MUNICIPAL DAILY SECURITIES BOND BOND HIGH YIELD INCOME FUND ($) FUND ($) FUND ($) FUND ($) COMPANY ($) -------------- -------------- -------------- -------------- -------------- CLASS A Net assets 12,184,030 1,527,683 4,000,369 350,819,020 -- Shares outstanding 917,670 150,556 323,024 39,799,216 -- Net asset value per share (a)(b) 13.28 10.15 12.38 8.81 -- Maximum sales charge 4.75% 4.75% 4.75% 4.75% -- Maximum offering price per share (c) 13.94 10.66 13.00 9.25 -- -------------- -------------- -------------- -------------- -------------- CLASS B Net assets 4,027,135 766,368 1,245,939 101,165,052 -- Shares outstanding 303,313 75,527 100,608 11,476,876 -- Net asset value and offering price per share (a)(b) 13.28 10.15 12.38 8.81 -- -------------- -------------- -------------- -------------- -------------- CLASS C Net assets 221,220 355,123 401,635 22,754,438 -- Shares outstanding 16,661 34,998 32,433 2,581,469 -- Net asset value and offering price per share (a)(b) 13.28 10.15 12.38 8.81 -- -------------- -------------- -------------- -------------- -------------- CLASS D Net assets 1,495,516 259,101 780,835 73,770,069 -- Shares outstanding 112,639 25,535 63,051 8,368,998 -- Net asset value and offering price per share (a)(b) 13.28 10.15 12.38 8.81 -- -------------- -------------- -------------- -------------- -------------- CLASS G Net assets -- -- -- -- -- Shares outstanding -- -- -- -- -- Net asset value and offering price per share (a) -- -- -- -- -- -------------- -------------- -------------- -------------- -------------- CLASS T Net assets -- -- -- -- -- Shares outstanding -- -- -- -- -- Net asset value per share (a) -- -- -- -- -- Maximum sales charge -- -- -- -- -- Maximum offering price per share (c) -- -- -- -- -- -------------- -------------- -------------- -------------- -------------- CLASS Z Net assets 265,126,671 8,044,057 419,286,415 1,221,699,984 546,209,019 Shares outstanding 19,968,711 792,653 33,856,656 138,596,820 546,209,725 Net asset value and offering price per share (b) 13.28 10.15 12.38 8.81 1.00
See Accompanying Notes to Financial Statements. | 137 STATEMENTS OF OPERATIONS _______________________________________________________ For the Six Months Ended February 28, 2005 (Unaudited) Columbia Funds
COMMON INTERNATIONAL MID CAP SMALL CAP STOCK GROWTH STOCK GROWTH GROWTH FUND ($) FUND ($) FUND ($) FUND ($) FUND ($) ------------- ------------- ------------- ------------- ------------- NET INVESTMENT INCOME INCOME Dividends 2,925,955 7,257,527 4,254,312 1,668,758 310,047 Interest 44,789 46,234 177,664 90,133 40,082 Interest from affiliates -- -- -- -- -- Foreign taxes withheld (2,509) (10,840) (165,228) (15,641) -- -------------- -------------- -------------- -------------- -------------- Total income 2,968,235 7,292,921 4,266,748 1,743,250 350,129 -------------- -------------- -------------- -------------- -------------- EXPENSES Investment advisory fee 841,103 2,408,712 2,895,191 3,609,766 1,760,580 Distribution fee: Class B 7,893 8,941 40,135 20,610 -- Class C 165 1,041 2,508 2,103 -- Class D 455 524 2,826 2,251 -- Class G -- 43,411 -- 2,260 -- Service fee: Class A 1,218 6,170 32,272 6,202 -- Class B 2,631 2,980 13,378 6,870 -- Class C 55 347 836 701 -- Class D 152 175 942 751 -- Class G -- 20,036 -- 1,043 -- Shareholder services fee - Class T -- -- -- 40,556 -- Transfer agent fee 341,831 756,182 377,748 760,503 296,130 Pricing and bookkeeping fees 61,338 78,219 83,684 80,033 66,104 Directors' fees 6,691 9,680 7,879 16,193 12,292 Custody fee 14,155 14,699 185,358 18,822 26,757 Audit fee 16,444 17,480 16,965 14,948 17,099 Registration fees 42,347 26,533 57,078 60,415 33,237 Merger costs -- -- 17,775 -- -- Non-recurring costs (See Note 10) 2,299 6,719 5,715 7,512 2,733 Other expenses 39,166 68,333 77,963 145,661 65,293 -------------- -------------- -------------- -------------- -------------- Total Operating Expenses 1,377,943 3,470,182 3,818,253 4,797,200 2,280,225 Interest expense -- -- -- 5,137 5,340 -------------- -------------- -------------- -------------- -------------- Total Expenses 1,377,943 3,470,182 3,818,253 4,802,337 2,285,565 Expenses waived/reimbursed by Investment Advisor -- -- (102,216) -- -- Fees waived by Distributor: Class C -- -- -- -- -- Class D -- -- -- -- -- Fees waived by Transfer Agent -- -- (300,616) (219,053) -- Non-recurring costs assumed by Investment Advisor (See Note 10) (2,299) (6,719) (5,715) (7,512) (2,733) Custody earnings credit (3) -- (25) (1,036) (6) -------------- -------------- -------------- -------------- -------------- Net Expenses 1,375,641 3,463,463 3,409,681 4,574,736 2,282,826 -------------- -------------- -------------- -------------- -------------- Net Investment Income (Loss) 1,592,594 3,829,458 857,067 (2,831,486) (1,932,697)
138 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ Columbia Funds
REAL ESTATE STRATEGIC SHORT TERM EQUITY TECHNOLOGY INVESTOR BALANCED BOND FUND ($) FUND ($) FUND ($) FUND ($) FUND ($) ------------- ------------- ------------- ------------- ------------- NET INVESTMENT INCOME INCOME Dividends 24,203,923 24,817 2,614,815 2,989,334 -- Interest 201,029 9,514 1,075,367 3,905,103 8,608,182 Interest from affiliates -- -- -- -- 45,118 Foreign taxes withheld (19,805) (67) (39,358) (2,349) -- -------------- -------------- -------------- -------------- -------------- Total income 24,385,147 34,264 3,650,824 6,892,088 8,653,300 -------------- -------------- -------------- -------------- -------------- EXPENSES Investment advisory fee 3,536,584 189,093 1,701,237 1,101,994 1,198,182 Distribution fee: Class B 47,894 9,977 109,763 28,047 88,330 Class C 11,605 2,953 86,876 2,992 11,980 Class D 15,883 94 2,471 1,253 31,696 Class G -- -- -- -- 3,113 Service fee: Class A 47,214 5,583 149,582 3,365 32,504 Class B 15,965 3,326 36,588 9,349 29,444 Class C 3,868 985 28,873 997 3,994 Class D 5,295 31 824 417 10,565 Class G -- -- -- -- 718 Shareholder services fee - Class T -- -- -- -- 15,160 Transfer agent fee 543,560 83,983 346,046 392,581 223,610 Pricing and bookkeeping fees 79,406 31,396 73,658 93,024 94,169 Directors' fees 16,471 3,298 7,408 8,813 8,342 Custody fee 13,309 8,385 21,833 18,755 16,192 Audit fee 14,851 12,254 16,846 18,924 17,248 Registration fees 67,894 47,542 50,857 43,067 68,648 Merger costs -- -- -- -- -- Non-recurring costs (See Note 10) 8,095 372 4,100 3,583 4,404 Other expenses 142,561 10,742 57,385 48,467 40,127 -------------- -------------- -------------- -------------- -------------- Total Operating Expenses 4,570,455 410,014 2,694,347 1,775,628 1,898,426 Interest expense -- -- -- -- -- -------------- -------------- -------------- -------------- -------------- Total Expenses 4,570,455 410,014 2,694,347 1,775,628 1,898,426 Expenses waived/reimbursed by Investment Advisor -- (43,327) -- -- (29,236) Fees waived by Distributor: Class C -- -- -- -- (9,584) Class D -- -- -- -- (25,356) Fees waived by Transfer Agent -- -- (68,050) -- -- Non-recurring costs assumed by Investment Advisor (See Note 10) (8,095) (372) (4,100) (3,583) (4,404) Custody earnings credit (1,558) (320) (588) (35) (1,837) -------------- -------------- -------------- -------------- -------------- Net Expenses 4,560,802 365,995 2,621,609 1,772,010 1,828,009 -------------- -------------- -------------- -------------- -------------- Net Investment Income (Loss) 19,824,345 (331,731) 1,029,215 5,120,078 6,825,291
FIXED NATIONAL OREGON INCOME MUNICIPAL MUNICIPAL DAILY SECURITIES BOND BOND HIGH YIELD INCOME FUND ($) FUND ($) FUND ($) FUND ($) COMPANY ($) -------------- -------------- -------------- -------------- -------------- NET INVESTMENT INCOME INCOME Dividends -- -- -- -- -- Interest 7,468,511 277,575 9,925,305 57,097,657 6,107,967 Interest from affiliates -- -- -- -- -- Foreign taxes withheld -- -- -- (24,861) -- -------------- -------------- -------------- -------------- -------------- Total income 7,468,511 277,575 9,925,305 57,072,796 6,107,967 -------------- -------------- -------------- -------------- -------------- EXPENSES Investment advisory fee 783,160 34,435 1,074,375 4,961,823 1,472,270 Distribution fee: Class B 15,357 2,720 4,527 383,162 -- Class C 766 1,352 1,318 81,657 -- Class D 6,043 1,347 2,937 298,924 -- Class G -- -- -- -- -- Service fee: Class A 14,547 2,501 4,754 427,367 -- Class B 5,119 906 1,509 127,721 -- Class C 255 451 439 27,219 -- Class D 2,014 449 979 99,641 -- Class G -- -- -- -- -- Shareholder services fee - Class T -- -- -- -- -- Transfer agent fee 341,321 9,242 129,420 868,318 701,559 Pricing and bookkeeping fees 71,877 33,169 86,718 89,156 79,121 Directors' fees 7,228 1,792 10,213 25,766 11,009 Custody fee 11,150 3,711 11,526 30,684 14,593 Audit fee 18,214 15,784 17,981 16,723 16,067 Registration fees 41,683 40,239 47,487 99,046 48,198 Merger costs -- -- -- -- -- Non-recurring costs (See Note 10) 2,599 114 3,707 15,281 -- Other expenses 55,136 5,689 43,679 237,756 69,419 -------------- -------------- -------------- -------------- -------------- Total Operating Expenses 1,376,469 153,901 1,441,569 7,790,244 2,412,236 Interest expense -- -- -- -- -- -------------- -------------- -------------- -------------- -------------- Total Expenses 1,376,469 153,901 1,441,569 7,790,244 2,412,236 Expenses waived/reimbursed by Investment Advisor -- (98,849) -- -- -- Fees waived by Distributor: Class C (153) (631) (615) (16,331) -- Class D (1,209) (629) (1,371) (59,785) -- Fees waived by Transfer Agent -- -- -- -- -- Non-recurring costs assumed by Investment Advisor (See Note 10) (2,599) (114) (3,707) (15,281) -- Custody earnings credit (91) (443) (863) (11,794) (3,166) -------------- -------------- -------------- -------------- -------------- Net Expenses 1,372,417 53,235 1,435,013 7,687,053 2,409,070 -------------- -------------- -------------- -------------- -------------- Net Investment Income (Loss) 6,096,094 224,340 8,490,292 49,385,743 3,698,897
See Accompanying Notes to Financial Statements. | 139 STATEMENTS OF OPERATIONS _______________________________________________________ For the Six Months Ended February 28, 2005 (Unaudited) Columbia Funds
COMMON INTERNATIONAL MID CAP SMALL CAP STOCK GROWTH STOCK GROWTH GROWTH FUND ($) FUND ($) FUND ($) FUND ($) FUND ($) -------------- -------------- -------------- -------------- -------------- NETREALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS, FOREIGN CURRENCY, FOREIGN CAPITAL GAINS TAX, FUTURES CONTRACTS AND WRITTEN OPTIONS Net realized gain (loss) on: Unaffiliated investments 25,261,154 106,671,480 34,220,256 79,039,286 94,443,764 Affiliated investments -- -- -- -- -- Foreign currency transactions -- -- (485,129) (121) -- Foreign capital gains tax -- -- (185,530) -- -- Futures contracts -- -- -- -- -- Written options -- -- -- -- -- -------------- -------------- -------------- -------------- -------------- Net realized gain (loss) 25,261,154 106,671,480 33,549,597 79,039,165 94,443,764 -------------- -------------- -------------- -------------- -------------- Net change in unrealized appreciation (depreciation) on: Investments 1,249,477 (19,909,044) 70,192,486 96,218,575 (17,834,445) Foreign currency translations -- -- 6,296 (9) -- Foreign capital gains tax -- -- 69,167 -- -- Futures contracts -- -- -- -- -- -------------- -------------- -------------- -------------- -------------- Net change in net unrealized appreciation (depreciation) 1,249,477 (19,909,044) 70,267,949 96,218,566 (17,834,445) -------------- -------------- -------------- -------------- -------------- Net Gain (Loss) 26,510,631 86,762,436 103,817,546 175,257,731 76,609,319 -------------- -------------- -------------- -------------- -------------- Net Increase Resulting From Operations 28,103,225 90,591,894 104,674,613 172,426,245 74,676,622
140 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ Columbia Funds
REAL ESTATE STRATEGIC SHORT TERM EQUITY TECHNOLOGY INVESTOR BALANCED BOND FUND ($) FUND ($) FUND ($) FUND ($) FUND ($) -------------- -------------- -------------- -------------- -------------- NETREALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS, FOREIGN CURRENCY, FOREIGN CAPITAL GAINS TAX, FUTURES CONTRACTS AND WRITTEN OPTIONS Net realized gain (loss) on: Unaffiliated investments 35,675,864 4,370,719 18,071,454 25,853,287 (221,740) Affiliated investments -- -- -- -- -- Foreign currency transactions -- (725) (26,833) -- -- Foreign capital gains tax -- -- -- -- -- Futures contracts -- -- -- -- 618,423 Written options -- (49,201) -- -- -- -------------- -------------- -------------- -------------- -------------- Net realized gain (loss) 35,675,864 4,320,793 18,044,621 25,853,287 396,683 -------------- -------------- -------------- -------------- -------------- Net change in unrealized appreciation (depreciation) on: Investments 38,119,794 3,144,220 36,144,129 1,318,713 (4,400,334) Foreign currency translations -- (832) 955 -- -- Foreign capital gains tax -- -- -- -- -- Futures contracts -- -- -- 5,469 118,438 -------------- -------------- -------------- -------------- -------------- Net change in net unrealized appreciation (depreciation) 38,119,794 3,143,388 36,145,084 1,324,182 (4,281,896) -------------- -------------- -------------- -------------- -------------- Net Gain (Loss) 73,795,658 7,464,181 54,189,705 27,177,469 (3,885,213) -------------- -------------- -------------- -------------- -------------- Net Increase Resulting From Operations 93,620,003 7,132,450 55,218,920 32,297,547 2,940,078
FIXED NATIONAL OREGON INCOME MUNICIPAL MUNICIPAL DAILY SECURITIES BOND BOND HIGH YIELD INCOME FUND ($) FUND ($) FUND ($) FUND ($) COMPANY ($) -------------- -------------- -------------- -------------- -------------- NETREALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS, FOREIGN CURRENCY, FOREIGN CAPITAL GAINS TAX, FUTURES CONTRACTS AND WRITTEN OPTIONS Net realized gain (loss) on: Unaffiliated investments 1,907,537 158,136 (790,713) 11,092,114 (706) Affiliated investments -- -- -- -- -- Foreign currency transactions -- -- -- -- -- Foreign capital gains tax -- -- -- -- -- Futures contracts -- -- -- -- -- Written options -- -- -- -- -- -------------- -------------- -------------- -------------- -------------- Net realized gain (loss) 1,907,537 158,136 (790,713) 11,092,114 (706) -------------- -------------- -------------- -------------- -------------- Net change in unrealized appreciation (depreciation) on: Investments (2,994,038) (215,305) (313,369) 17,645,666 -- Foreign currency translations -- -- -- -- -- Foreign capital gains tax -- -- -- -- -- Futures contracts 10,156 -- -- -- -- -------------- -------------- -------------- -------------- -------------- Net change in net unrealized appreciation (depreciation) (2,983,882) (215,305) (313,369) 17,645,666 -- -------------- -------------- -------------- -------------- -------------- Net Gain (Loss) (1,076,345) (57,169) (1,104,082) 28,737,780 (706) -------------- -------------- -------------- -------------- -------------- Net Increase Resulting From Operations 5,019,749 167,171 7,386,210 78,123,523 3,698,191
See Accompanying Notes to Financial Statements. | 141 STATEMENTS OF CHANGES IN NET ASSETS ____________________________________________ Columbia Funds
COMMON STOCK FUND GROWTH FUND ------------------------------- ------------------------------- (UNAUDITED) (UNAUDITED) SIX MONTHS YEAR SIX MONTHS YEAR ENDED ENDED ENDED ENDED FEBRUARY 28, AUGUST 31, FEBRUARY 28, AUGUST 31, INCREASE (DECREASE) IN NET ASSETS 2005 ($) 2004 (a)($) 2005 ($) 2004 (a)($) -------------- -------------- -------------- -------------- OPERATIONS Net investment income (loss) 1,592,594 1,585,012 3,829,458 (308,677) Net realized gain on investments, foreign currency transactions and foreign capital gains tax 25,261,154 79,536,751 106,671,480 90,532,670 Net change in unrealized appreciation (depreciation) on investments, foreign currency translations and foreign capital gains tax 1,249,477 (53,832,811) (19,909,044) (70,015,156) -------------- -------------- -------------- -------------- Net increase (decrease) resulting from operations 28,103,225 27,288,952 90,591,894 20,208,837 -------------- -------------- -------------- -------------- DISTRIBUTIONS TO SHAREHOLDERS From net investment income: Class A (4,706) (707) (17,544) -- Class B -- -- (2,595) -- Class C -- -- (313) -- Class D -- -- (135) -- Class G -- -- (16,361) -- Class Z (2,179,613) (2,316,812) (3,275,459) -- -------------- -------------- -------------- -------------- Total distributions to shareholders (2,184,319) (2,317,519) (3,312,407) -- -------------- -------------- -------------- -------------- NET CAPITAL SHARE TRANSACTIONS (104,543,553) (146,922,763) (160,625,759) (138,965,772) -------------- -------------- -------------- -------------- REDEMPTION FEES -- -- -- -- -------------- -------------- -------------- -------------- Net increase (decrease) in net assets (78,624,647) (121,951,330) (73,346,272) (118,756,935) -------------- -------------- -------------- -------------- NET ASSETS Beginning of period 306,673,388 428,624,718 810,979,317 929,736,252 End of period 228,048,741 306,673,388 737,633,045 810,979,317 -------------- -------------- -------------- -------------- Undistributed net investment income, at end of period 182,214 773,939 512,736 -- Accumulated net investment loss, at end of period -- -- -- (4,315)
(a) Class C shares were initially offered on October 13, 2003. 142 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ Columbia Funds
INTERNATIONAL STOCK FUND MID CAP GROWTH FUND ------------------------------- ------------------------------- (UNAUDITED) (UNAUDITED) SIX MONTHS YEAR SIX MONTHS YEAR ENDED ENDED ENDED ENDED FEBRUARY 28, AUGUST 31, FEBRUARY 28, AUGUST 31, INCREASE (DECREASE) IN NET ASSETS 2005 ($) 2004 (a)($) 2005 ($) 2004 (a)($) -------------- -------------- -------------- -------------- OPERATIONS Net investment income (loss) 857,067 3,691,183 (2,831,486) (7,794,468) Net realized gain on investments, foreign currency transactions and foreign capital gains tax 33,549,597 29,666,692 79,039,165 136,610,324 Net change in unrealized appreciation (depreciation) on investments, foreign currency translations and foreign capital gains tax 70,267,949 12,929,801 96,218,566 (178,274,861) -------------- -------------- -------------- -------------- Net increase (decrease) resulting from operations 104,674,613 46,287,676 172,426,245 (49,459,005) -------------- -------------- -------------- -------------- DISTRIBUTIONS TO SHAREHOLDERS From net investment income: Class A (6,207) -- -- -- Class B -- -- -- -- Class C -- -- -- -- Class D -- -- -- -- Class G -- -- -- -- Class Z (3,041,055) (1,290,808) -- -- -------------- -------------- -------------- -------------- Total distributions to shareholders (3,047,262) (1,290,808) -- -- -------------- -------------- -------------- -------------- NET CAPITAL SHARE TRANSACTIONS (17,502,846) 267,394,781 (170,003,285) (127,233,529) -------------- -------------- -------------- -------------- REDEMPTION FEES 48,461 68,059 -- -- -------------- -------------- -------------- -------------- Net increase (decrease) in net assets 84,172,966 312,459,708 2,422,960 (176,692,534) -------------- -------------- -------------- -------------- NET ASSETS Beginning of period 593,791,267 281,331,559 862,481,319 1,039,173,853 End of period 677,964,233 593,791,267 864,904,279 862,481,319 -------------- -------------- -------------- -------------- Undistributed net investment income, at end of period 84,031 2,274,226 -- -- Accumulated net investment loss, at end of period -- -- (2,905,359) (73,873)
SMALL CAP GROWTH FUND ------------------------------- (UNAUDITED) SIX MONTHS YEAR ENDED ENDED FEBRUARY 28, AUGUST 31, INCREASE (DECREASE) IN NET ASSETS 2005 ($) 2004 ($) -------------- -------------- OPERATIONS Net investment income (loss) (1,932,697) (7,090,174) Net realized gain on investments, foreign currency transactions and foreign capital gains tax 94,443,764 108,746,196 Net change in unrealized appreciation (depreciation) on investments, foreign currency translations and foreign capital gains tax (17,834,445) (104,998,632) -------------- -------------- Net increase (decrease) resulting from operations 74,676,622 (3,342,610) -------------- -------------- DISTRIBUTIONS TO SHAREHOLDERS From net investment income: Class A -- -- Class B -- -- Class C -- -- Class D -- -- Class G -- -- Class Z -- -- -------------- -------------- Total distributions to shareholders -- -- -------------- -------------- NET CAPITAL SHARE TRANSACTIONS (355,765,616) (91,256,656) -------------- -------------- REDEMPTION FEES -- -- -------------- -------------- Net increase (decrease) in net assets (281,088,994) (94,599,266) -------------- -------------- NET ASSETS Beginning of period 543,016,307 637,615,573 End of period 261,927,313 543,016,307 -------------- -------------- Undistributed net investment income, at end of period -- -- Accumulated net investment loss, at end of period (1,932,697) --
See Accompanying Notes to Financial Statements. | 143 STATEMENTS OF CHANGES IN NET ASSETS ____________________________________________ Columbia Funds
REAL ESTATE EQUITY FUND TECHNOLOGY FUND ------------------------------- -------------------------------- (UNAUDITED) (UNAUDITED) SIX MONTHS YEAR SIX MONTHS YEAR ENDED ENDED ENDED ENDED FEBRUARY 28, AUGUST 31, FEBRUARY 28, AUGUST 31, INCREASE (DECREASE) IN NET ASSETS 2005 ($) 2004 (a)($) 2005 ($) 2004 (a)($) -------------- -------------- -------------- -------------- OPERATIONS Net investment income (loss) 19,824,345 33,479,872 (331,731) (500,247) Net realized gain on investments, foreign currency transactions, futures contracts and written options 35,675,864 103,930,894 4,320,793 3,148,988 Net change in unrealized appreciation (depreciation) on investments, foreign currency translations and futures contracts 38,119,794 86,151,012 3,143,388 (1,040,511) -------------- -------------- -------------- -------------- Net increase resulting from operations 93,620,003 223,561,778 7,132,450 1,608,230 -------------- -------------- -------------- -------------- DISTRIBUTIONS TO SHAREHOLDERS From net investment income: Class A (905,337) (812,573) -- -- Class B (262,371) (181,510) -- -- Class C (61,673) (21,166) -- -- Class D (85,345) (96,766) -- -- Class G -- -- -- -- Class T -- -- -- -- Class Z (22,518,021) (30,549,898) -- -- From net realized gains: Class A (3,329,894) (191,896) -- -- Class B (1,146,743) (55,846) -- -- Class C (270,229) (4,533) -- -- Class D (366,470) (37,082) -- -- Class Z (77,132,969) (8,007,605) -- -- -------------- -------------- -------------- -------------- Total distributions to shareholders (106,079,052) (39,958,875) -- -- -------------- -------------- -------------- -------------- NET CAPITAL SHARE TRANSACTIONS (37,061,566) (165,633,084) 655,640 12,887,088 -------------- -------------- -------------- -------------- Net increase (decrease) in net assets (49,520,615) 17,969,819 7,788,090 14,495,318 -------------- -------------- -------------- -------------- NET ASSETS Beginning of period 923,323,339 905,353,520 35,794,805 21,299,487 End of period 873,802,724 923,323,339 43,582,895 35,794,805 -------------- -------------- -------------- -------------- Undistributed (overdistributed) net investment income, at end of period (1,442,510) 2,565,892 -- -- Accumulated net investment loss, at end of period -- -- (336,464) (4,733)
(a) Class C shares were initially offered on October 13, 2003. 144 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ Columbia Funds
STRATEGIC INVESTOR FUND BALANCED FUND ------------------------------- -------------------------------- (UNAUDITED) (UNAUDITED) SIX MONTHS YEAR SIX MONTHS YEAR ENDED ENDED ENDED ENDED FEBRUARY 28, AUGUST 31, FEBRUARY 28, AUGUST 31, INCREASE (DECREASE) IN NET ASSETS 2005 ($) 2004 (a)($) 2005 ($) 2004 (a)($) -------------- -------------- -------------- -------------- OPERATIONS Net investment income (loss) 1,029,215 1,155,970 5,120,078 10,289,328 Net realized gain on investments, foreign currency transactions, futures contracts and written options 18,044,621 32,839,116 25,853,287 82,607,475 Net change in unrealized appreciation (depreciation) on investments, foreign currency translations and futures contracts 36,145,084 11,369,353 1,324,182 (57,419,638) -------------- -------------- -------------- -------------- Net increase resulting from operations 55,218,920 45,364,439 32,297,547 35,477,165 -------------- -------------- -------------- -------------- DISTRIBUTIONS TO SHAREHOLDERS From net investment income: Class A (166,914) (258,188) (28,713) (23,144) Class B -- -- (53,687) (36,893) Class C (169) -- (5,791) (2,894) Class D -- -- (2,436) (4,198) Class G -- -- -- -- Class T -- -- -- -- Class Z (1,065,597) (1,487,644) (5,373,597) (10,830,515) From net realized gains: Class A (1,363,900) -- -- -- Class B (348,215) -- -- -- Class C (284,993) -- -- -- Class D (6,971) -- -- -- Class Z (3,186,368) -- -- -- -------------- -------------- -------------- -------------- Total distributions to shareholders (6,423,127) (1,745,832) (5,464,224) (10,897,644) -------------- -------------- -------------- -------------- NET CAPITAL SHARE TRANSACTIONS 42,960,372 74,083,888 (136,364,326) (175,070,636) -------------- -------------- -------------- -------------- Net increase (decrease) in net assets 91,756,165 117,702,495 (109,531,003) (150,491,115) -------------- -------------- -------------- -------------- NET ASSETS Beginning of period 409,370,516 291,668,021 494,700,242 645,191,357 End of period 501,126,681 409,370,516 385,169,239 494,700,242 -------------- -------------- -------------- -------------- Undistributed (overdistributed) net investment income, at end of period 200,441 403,906 990,024 1,334,170 Accumulated net investment loss, at end of period -- -- -- --
SHORT TERM BOND FUND ------------------------------- (UNAUDITED) SIX MONTHS YEAR ENDED ENDED FEBRUARY 28, AUGUST 31, INCREASE (DECREASE) IN NET ASSETS 2005 ($) 2004 (a)($) -------------- -------------- OPERATIONS Net investment income (loss) 6,825,291 11,677,205 Net realized gain on investments, foreign currency transactions, futures contracts and written options 396,683 273,948 Net change in unrealized appreciation (depreciation) on investments, foreign currency translations and futures contracts (4,281,896) 671,338 -------------- -------------- Net increase resulting from operations 2,940,078 12,622,491 -------------- -------------- DISTRIBUTIONS TO SHAREHOLDERS From net investment income: Class A (322,131) (587,965) Class B (203,816) (312,592) Class C (37,191) (32,292) Class D (98,629) (283,218) Class G (9,208) (18,591) Class T (260,835) (518,577) Class Z (5,902,430) (9,814,113) From net realized gains: Class A -- -- Class B -- -- Class C -- -- Class D -- -- Class Z -- -- -------------- -------------- Total distributions to shareholders (6,834,240) (11,567,348) -------------- -------------- NET CAPITAL SHARE TRANSACTIONS (28,452,047) (24,733,033) -------------- -------------- Net increase (decrease) in net assets (32,346,209) (23,677,890) -------------- -------------- NET ASSETS Beginning of period 525,498,187 549,176,077 End of period 493,151,978 525,498,187 -------------- -------------- Undistributed (overdistributed) net investment income, at end of period 284,936 293,885 Accumulated net investment loss, at end of period -- --
(a) Class C shares were initially offered on October 13, 2003. See Accompanying Notes to Financial Statements. | 145 STATEMENTS OF CHANGES IN NET ASSETS ____________________________________________ Columbia Funds
FIXED INCOME NATIONAL MUNICIPAL SECURITIES FUND BOND FUND ------------------------------- -------------------------------- (UNAUDITED) (UNAUDITED) SIX MONTHS YEAR SIX MONTHS YEAR ENDED ENDED ENDED ENDED FEBRUARY 28, AUGUST 31, FEBRUARY 28, AUGUST 31, INCREASE (DECREASE) IN NET ASSETS 2005 ($) 2004 (a)($) 2005 ($) 2004 (a)($) -------------- -------------- -------------- -------------- OPERATIONS Net investment income 6,096,094 16,516,684 224,340 543,600 Net realized gain (loss) on investments and futures contracts 1,907,537 6,873,389 158,136 128,356 Net change in unrealized appreciation (depreciation) on investments and futures contracts (2,983,882) (509,297) (215,305) 251,062 -------------- -------------- -------------- -------------- Net increase resulting from operations 5,019,749 22,880,776 167,171 923,018 -------------- -------------- -------------- -------------- DISTRIBUTIONS TO SHAREHOLDERS From net investment income: Class A (228,247) (352,163) (30,924) (30,673) Class B (65,008) (142,805) (8,680) (19,451) Class C (3,385) (3,354) (4,950) (17,369) Class D (26,783) (76,542) (4,930) (14,134) Class Z (6,149,920) (16,812,198) (174,488) (460,894) From net realized gains: Class A (126,358) -- (18,003) (6,106) Class B (41,709) -- (6,522) (5,641) Class C (2,300) -- (3,295) (6,127) Class D (16,379) -- (2,764) (3,786) Class Z (3,091,101) -- (94,442) (98,282) -------------- -------------- -------------- -------------- Total distributions to shareholders (9,751,190) (17,387,062) (348,998) (662,463) -------------- -------------- -------------- -------------- NET CAPITAL SHARE TRANSACTIONS (53,483,550) (184,814,748) (3,677,644) (1,232,294) -------------- -------------- -------------- -------------- Net increase (decrease) in net assets (58,214,991) (179,321,034) (3,859,471) (971,739) -------------- -------------- -------------- -------------- NET ASSETS Beginning of period 341,269,563 520,590,597 14,811,803 15,783,542 End of period 283,054,572 341,269,563 10,952,332 14,811,803 -------------- -------------- -------------- -------------- Undistributed (overdistributed) net investment income, at end of period (1,144,058) (766,809) 5,407 5,039
(a) Class C shares were initially offered on October 13, 2003. 146 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ Columbia Funds
OREGON MUNICIPAL BOND FUND HIGH YIELD FUND ------------------------------- -------------------------------- (UNAUDITED) (UNAUDITED) SIX MONTHS YEAR SIX MONTHS YEAR ENDED ENDED ENDED ENDED FEBRUARY 28, AUGUST 31, FEBRUARY 28, AUGUST 31, INCREASE (DECREASE) IN NET ASSETS 2005 ($) 2004 (a)($) 2005 ($) 2004 (a)($) -------------- -------------- -------------- -------------- OPERATIONS Net investment income 8,490,292 18,807,129 49,385,743 102,105,979 Net realized gain (loss) on investments and futures contracts (790,713) 3,418,754 11,092,114 23,256,561 Net change in unrealized appreciation (depreciation) on investments and futures contracts (313,369) 9,460,520 17,645,666 23,594,415 -------------- -------------- -------------- -------------- Net increase resulting from operations 7,386,210 31,686,403 78,123,523 148,956,955 -------------- -------------- -------------- -------------- DISTRIBUTIONS TO SHAREHOLDERS From net investment income: Class A (70,171) (105,796) (10,221,155) (16,842,377) Class B (17,759) (36,225) (2,672,799) (5,543,127) Class C (5,754) (3,971) (585,279) (651,730) Class D (12,904) (26,303) (2,145,953) (5,747,649) Class Z (8,349,512) (18,620,689) (37,824,156) (81,901,552) From net realized gains: Class A (11,016) (28,392) -- -- Class B (3,546) (15,169) -- -- Class C (1,075) (702) -- -- Class D (2,262) (9,045) -- -- Class Z (1,212,920) (5,411,625) -- -- -------------- -------------- -------------- -------------- Total distributions to shareholders (9,686,919) (24,257,917) (53,449,342) (110,686,435) -------------- -------------- -------------- -------------- NET CAPITAL SHARE TRANSACTIONS (12,432,078) (56,244,778) 14,220,062 108,928,738 -------------- -------------- -------------- -------------- Net increase (decrease) in net assets (14,732,787) (48,816,292) 38,894,243 147,199,258 -------------- -------------- -------------- -------------- NET ASSETS Beginning of period 440,447,980 489,264,272 1,731,314,320 1,584,115,062 End of period 425,715,193 440,447,980 1,770,208,563 1,731,314,320 -------------- -------------- -------------- -------------- Undistributed (overdistributed) net investment income, at end of period 163,207 129,015 (12,628,636) (8,565,037)
DAILY INCOME COMPANY ------------------------------- (UNAUDITED) SIX MONTHS YEAR ENDED ENDED FEBRUARY 28, AUGUST 31, INCREASE (DECREASE) IN NET ASSETS 2005 ($) 2004 (a)($) -------------- -------------- OPERATIONS Net investment income 3,698,897 2,925,450 Net realized gain (loss) on investments and futures contracts (706) -- Net change in unrealized appreciation (depreciation) on investments and futures contracts -- -- -------------- -------------- from operations 3,698,191 2,925,450 -------------- -------------- DISTRIBUTIONS TO SHAREHOLDERS From net investment income: Class A -- -- Class B -- -- Class C -- -- Class D -- -- Class Z (3,698,897) (2,925,450) From net realized gains: Class A -- -- Class B -- -- Class C -- -- Class D -- -- Class Z -- -- -------------- -------------- Total distributions to shareholders (3,698,897) (2,925,450) -------------- -------------- NET CAPITAL SHARE TRANSACTIONS (114,903,821) (237,050,335) -------------- -------------- Net increase (decrease) in net assets (114,904,527) (237,050,335) -------------- -------------- NET ASSETS Beginning of period 661,113,546 898,163,881 End of period 546,209,019 661,113,546 -------------- -------------- Undistributed (overdistributed) net investment income, at end of period -- --
See Accompanying Notes to Financial Statements. | 147 STATEMENTS OF CHANGES IN NET ASSETS - CAPITAL STOCK ACTIVITY ___________________ Columbia Funds
COMMON STOCK FUND ------------------------------------------------------------------- (UNAUDITED) SIX MONTHS ENDED YEAR ENDED FEBRUARY 28, 2005 AUGUST 31, 2004 (a) ------------------------------- -------------------------------- SHARES DOLLARS ($) SHARES DOLLARS ($) -------------- -------------- -------------- -------------- CLASS A Subscriptions 5,019 92,982 64,115 1,177,263 Distributions reinvested 224 4,450 36 655 Redemptions (31,025) (596,132) (10,766) (202,298) -------------- -------------- -------------- -------------- Net increase (decrease) (25,782) (498,700) 53,385 975,620 CLASS B Subscriptions 2,618 47,991 107,474 1,972,354 Distributions reinvested -- -- -- -- Redemptions (10,373) (198,933) (28,529) (521,700) -------------- -------------- -------------- -------------- Net increase (decrease) (7,755) (150,942) 78,945 1,450,654 CLASS C Subscriptions 1,196 21,847 9,537 173,802 Distributions reinvested -- -- -- -- Redemptions (106) (2,037) (8,096) (153,076) -------------- -------------- -------------- -------------- Net increase 1,090 19,810 1,441 20,726 CLASS D Subscriptions -- -- 1,445 24,548 Distributions reinvested -- -- -- -- Redemptions (925) (17,048) (808) (14,636) -------------- -------------- -------------- -------------- Net increase (decrease) (925) (17,048) 637 9,912 CLASS G Subscriptions -- -- -- -- Distributions reinvested -- -- -- -- Redemptions -- -- -- -- -------------- -------------- -------------- -------------- Net decrease -- -- -- -- CLASS Z Subscriptions 512,882 9,869,852 3,255,220 60,420,176 Distributions reinvested 105,793 2,107,389 124,008 2,261,915 Redemptions (5,982,347) (115,873,914) (11,416,152) (212,061,766) -------------- -------------- -------------- -------------- Net decrease (5,363,672) (103,896,673) (8,036,924) (149,379,675)
(a) Class C shares were initially offered on October 13, 2003. 148 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ Columbia Funds
GROWTH FUND ------------------------------------------------------------------- (UNAUDITED) SIX MONTHS ENDED YEAR ENDED FEBRUARY 28, 2005 AUGUST 31, 2004 (a) ------------------------------- -------------------------------- SHARES DOLLARS ($) SHARES DOLLARS ($) -------------- -------------- -------------- -------------- CLASS A Subscriptions 9,478 243,032 60,274 1,566,301 Distributions reinvested 605 16,954 -- -- Redemptions (22,524) (615,629) (44,945) (1,160,956) -------------- -------------- -------------- -------------- Net increase (decrease) (12,441) (355,643) 15,329 405,345 CLASS B Subscriptions 7,927 206,340 68,478 1,760,207 Distributions reinvested 82 2,272 -- -- Redemptions (12,383) (327,172) (9,246) (238,352) -------------- -------------- -------------- -------------- Net increase (decrease) (4,374) (118,560) 59,232 1,521,855 CLASS C Subscriptions 3,690 94,633 12,996 335,297 Distributions reinvested 7 204 -- -- Redemptions (1,027) (27,174) (4,898) (126,885) -------------- -------------- -------------- -------------- Net increase 2,670 67,663 8,098 208,412 CLASS D Subscriptions 134 3,520 4,931 120,807 Distributions reinvested 4 115 -- -- Redemptions (2,546) (64,849) (10,160) (252,432) -------------- -------------- -------------- -------------- Net increase (decrease) (2,408) (61,214) (5,229) (131,625) CLASS G Subscriptions 724 18,241 4,481 115,330 Distributions reinvested 579 16,035 -- -- Redemptions (42,070) (1,120,099) (81,959) (2,115,829) -------------- -------------- -------------- -------------- Net decrease (40,767) (1,085,823) (77,478) (2,000,499) CLASS Z Subscriptions 495,182 13,171,365 4,176,203 108,867,109 Distributions reinvested 98,174 2,769,477 -- -- Redemptions (6,459,859) (175,013,024) (9,500,046) (247,836,369) -------------- -------------- -------------- -------------- Net decrease (5,866,503) (159,072,182) (5,323,843) (138,969,260)
See Accompanying Notes to Financial Statements. | 149 STATEMENTS OF CHANGES IN NET ASSETS - CAPITAL STOCK ACTIVITY ___________________ Columbia Funds
INTERNATIONAL STOCK FUND ------------------------------------------------------------------- (UNAUDITED) SIX MONTHS ENDED YEAR ENDED FEBRUARY 28, 2005 AUGUST 31, 2004 (a) ------------------------------- -------------------------------- SHARES DOLLARS ($) SHARES DOLLARS ($) -------------- -------------- -------------- -------------- CLASS A Subscriptions 125,691 1,805,237 373,131 4,764,290 Distributions reinvested 376 5,549 -- -- Redemptions (169,101) (2,420,867) (433,072) (5,595,729) -------------- -------------- -------------- -------------- Net increase (decrease) (43,034) (610,081) (59,941) (831,439) CLASS B Subscriptions 99,181 1,400,095 257,984 3,329,492 Redemptions (142,375) (1,998,720) (378,452) (4,865,635) -------------- -------------- -------------- -------------- Net increase (decrease) (43,194) (598,625) (120,468) (1,536,143) CLASS C Subscriptions 9,833 140,304 77,717 997,912 Redemptions (17,661) (254,140) (28,604) (374,843) -------------- -------------- -------------- -------------- Net increase (decrease) (7,828) (113,836) 49,113 623,069 CLASS D Subscriptions 1,838 25,592 8,022 101,833 Redemptions (9,379) (133,270) (7,016) (89,891) -------------- -------------- -------------- -------------- Net increase (decrease) (7,541) (107,678) 1,006 11,942 CLASS G Subscriptions -- -- -- -- Redemptions -- -- -- -- -------------- -------------- -------------- -------------- Net decrease -- -- -- -- CLASS T Subscriptions -- -- -- -- Redemptions -- -- -- -- -------------- -------------- -------------- -------------- Net decrease -- -- -- -- CLASS Z Subscriptions 8,038,237 115,442,679 26,956,809 352,679,563 Distributions reinvested 61,891 916,609 44,157 563,444 Redemptions (9,128,072) (132,431,914) (6,345,590) (84,115,655) -------------- -------------- -------------- -------------- Net increase (decrease) (1,027,944) (16,072,626) 20,655,376 269,127,352
(a) Class C shares were initially offered on October 13, 2003. 150 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ Columbia Funds
MID CAP GROWTH FUND ------------------------------------------------------------------- (UNAUDITED) SIX MONTHS ENDED YEAR ENDED FEBRUARY 28, 2005 AUGUST 31, 2004 (a) ------------------------------- -------------------------------- SHARES DOLLARS ($) SHARES DOLLARS ($) -------------- -------------- -------------- -------------- CLASS A Subscriptions 59,205 1,133,511 291,660 5,434,656 Distributions reinvested -- -- -- -- Redemptions (50,760) (961,410) (280,956) (5,162,016) -------------- -------------- -------------- -------------- Net increase (decrease) 8,445 172,101 10,704 272,640 CLASS B Subscriptions 25,765 487,981 125,421 2,339,336 Redemptions (36,647) (678,971) (58,231) (1,066,216) -------------- -------------- -------------- -------------- Net increase (decrease) (10,882) (190,990) 67,190 1,273,120 CLASS C Subscriptions 5,453 101,981 35,421 677,522 Redemptions (7,345) (140,754) (5,599) (102,551) -------------- -------------- -------------- -------------- Net increase (decrease) (1,892) (38,773) 29,822 574,971 CLASS D Subscriptions 404 7,563 3,419 61,969 Redemptions (9,528) (181,534) (8,721) (155,931) -------------- -------------- -------------- -------------- Net increase (decrease) (9,124) (173,971) (5,302) (93,962) CLASS G Subscriptions 456 8,662 1,362 25,257 Redemptions (2,778) (50,715) (7,466) (136,718) -------------- -------------- -------------- -------------- Net decrease (2,322) (42,053) (6,104) (111,461) CLASS T Subscriptions 7,263 142,102 26,462 498,501 Redemptions (117,655) (2,232,891) (195,050) (3,653,424) -------------- -------------- -------------- -------------- Net decrease (110,392) (2,090,789) (168,588) (3,154,923) CLASS Z Subscriptions 1,876,048 36,148,449 6,071,998 114,038,896 Distributions reinvested -- -- -- -- Redemptions (10,491,567) (203,787,259) (12,860,265) (240,032,810) -------------- -------------- -------------- -------------- Net increase (decrease) (8,615,519) (167,638,810) (6,788,267) (125,993,914)
See Accompanying Notes to Financial Statements. | 151 STATEMENTS OF CHANGES IN NET ASSETS - CAPITAL STOCK ACTIVITY ___________________ Columbia Funds
SMALL CAP GROWTH FUND ------------------------------------------------------------ (UNAUDITED) SIX MONTHS ENDED YEAR ENDED FEBRUARY 28, 2005 AUGUST 31, 2004 ---------------------------- ---------------------------- SHARES DOLLARS ($) SHARES DOLLARS ($) ------------ ------------ ------------ ------------ CLASS A Subscriptions -- -- -- -- Distributions reinvested -- -- -- -- Redemptions -- -- -- -- ------------ ------------ ------------ ------------ Net increase -- -- -- -- CLASS B Subscriptions -- -- -- -- Distributions reinvested -- -- -- -- Redemptions -- -- -- -- ------------ ------------ ------------ ------------ Net increase -- -- -- -- CLASS C Subscriptions -- -- -- -- Distributions reinvested -- -- -- -- Redemptions -- -- -- -- ------------ ------------ ------------ ------------ Net increase -- -- -- -- CLASS D Subscriptions -- -- -- -- Distributions reinvested -- -- -- -- Redemptions -- -- -- -- ------------ ------------ ------------ ------------ Net increase (decrease) -- -- -- -- CLASS Z Subscriptions 1,233,156 29,157,984 10,261,845 240,997,658 Distributions reinvested -- -- -- -- Redemptions (16,274,806) (384,923,600) (14,285,853) (332,254,314) ------------ ------------ ------------ ------------ Net decrease (15,041,650) (355,765,616) (4,024,008) (91,256,656)
(a) Class C shares were initially offered on October 13, 2003. 152 | See Accompanying Notes to Financial Statements. STATEMENTS OF CHANGES IN NET ASSETS - CAPITAL STOCK ACTIVITY ___________________ Columbia Funds
REAL ESTATE EQUITY FUND ------------------------------------------------------------ (UNAUDITED) SIX MONTHS ENDED YEAR ENDED FEBRUARY 28, 2005 AUGUST 31, 2004 (a) ---------------------------- ---------------------------- SHARES DOLLARS ($) SHARES DOLLARS ($) ------------ ------------ ------------ ------------ CLASS A Subscriptions 464,223 12,200,896 1,626,030 36,784,752 Distributions reinvested 146,867 3,850,743 38,787 907,726 Redemptions (290,077) (7,601,613) (974,687) (22,619,991) ------------ ------------ ------------ ------------ Net increase 321,013 8,450,026 690,130 15,072,487 CLASS B Subscriptions 109,176 2,898,128 294,726 6,857,490 Distributions reinvested 40,240 1,057,230 7,307 170,161 Redemptions (51,944) (1,364,081) (90,228) (2,141,291) ------------ ------------ ------------ ------------ Net increase 97,472 2,591,277 211,805 4,886,360 CLASS C Subscriptions 52,107 1,362,092 106,764 2,516,283 Distributions reinvested 11,413 299,769 954 22,917 Redemptions (7,342) (192,487) (13,730) (323,033) ------------ ------------ ------------ ------------ Net increase 56,178 1,469,374 93,988 2,216,167 CLASS D Subscriptions 3,349 94,453 45,881 1,008,069 Distributions reinvested 13,975 367,181 4,705 107,738 Redemptions (6,262) (169,333) (56,804) (1,309,816) ------------ ------------ ------------ ------------ Net increase (decrease) 11,062 292,301 (6,218) (194,009) CLASS Z Subscriptions 3,955,555 103,839,262 15,372,264 353,978,184 Distributions reinvested 2,913,634 76,364,754 1,287,979 29,504,145 Redemptions (8,795,867) (230,068,560) (24,582,645) (571,096,418) ------------ ------------ ------------ ------------ Net decrease (1,926,678) (49,864,544) (7,922,402) (187,614,089)
See Accompanying Notes to Financial Statements. | 153 STATEMENTS OF CHANGES IN NET ASSETS - CAPITAL STOCK ACTIVITY ___________________ Columbia Funds
TECHNOLOGY FUND ------------------------------------------------------------ (UNAUDITED) SIX MONTHS ENDED YEAR ENDED FEBRUARY 28, 2005 AUGUST 31, 2004 (a) ---------------------------- ---------------------------- SHARES DOLLARS ($) SHARES DOLLARS ($) ------------ ------------ ------------ ------------ CLASS A Subscriptions 596,406 4,666,080 618,899 4,301,075 Distributions reinvested -- -- -- -- Redemptions (98,564) (762,662) (249,120) (1,754,239) ------------ ------------ ------------ ------------ Net increase 497,842 3,903,418 369,779 2,546,836 CLASS B Subscriptions 132,518 1,022,052 504,341 3,487,212 Distributions reinvested -- -- -- -- Redemptions (107,185) (815,672) (373,299) (2,552,196) ------------ ------------ ------------ ------------ Net increase 25,333 206,380 131,042 935,016 CLASS C Subscriptions 118,744 927,392 92,300 649,419 Distributions reinvested -- -- -- -- Redemptions (14,039) (100,472) (16,223) (116,780) ------------ ------------ ------------ ------------ Net increase 104,705 826,920 76,077 532,639 CLASS D Subscriptions 120 875 7,740 48,269 Distributions reinvested -- -- -- -- Redemptions (660) (5,097) (6,929) (49,293) ------------ ------------ ------------ ------------ Net increase (decrease) (540) (4,222) 811 (1,024) CLASS Z Subscriptions 1,170,340 9,143,823 5,040,767 35,087,433 Distributions reinvested -- -- -- -- Redemptions (1,730,807) (13,420,679) (3,732,749) (26,213,812) ------------ ------------ ------------ ------------ Net increase (decrease) (560,467) (4,276,856) 1,308,018 8,873,621
(a) Class C shares were initially offered on October 13, 2003. 154 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ Columbia Funds
STRATEGIC INVESTOR FUND ------------------------------------------------------------ (UNAUDITED) SIX MONTHS ENDED YEAR ENDED FEBRUARY 28, 2005 AUGUST 31, 2004 (a) ---------------------------- ---------------------------- SHARES DOLLARS ($) SHARES DOLLARS ($) ------------ ------------ ------------ ------------ CLASS A Subscriptions 1,904,164 37,240,356 2,239,525 40,978,091 Distributions reinvested 73,071 1,459,945 13,874 239,722 Redemptions (385,548) (7,580,929) (602,009) (10,711,424) ------------ ------------ ------------ ------------ Net increase 1,591,687 31,119,372 1,651,390 30,506,389 CLASS B Subscriptions 760,800 14,694,030 1,117,349 20,292,528 Distributions reinvested 15,739 310,686 -- -- Redemptions (96,725) (1,861,797) (117,595) (2,110,515) ------------ ------------ ------------ ------------ Net increase 679,814 13,142,919 999,754 18,182,013 CLASS C Subscriptions 713,119 13,661,979 842,913 15,346,291 Distributions reinvested 12,556 247,992 -- -- Redemptions (48,339) (942,678) (27,681) (499,929) ------------ ------------ ------------ ------------ Net increase 677,336 12,967,293 815,232 14,846,362 CLASS D Subscriptions 214 4,100 1,168 20,852 Distributions reinvested 318 6,281 -- -- Redemptions (6,493) (124,773) (7,595) (136,369) ------------ ------------ ------------ ------------ Net increase (decrease) (5,961) (114,392) (6,427) (115,517) CLASS Z Subscriptions 2,420,214 47,656,555 5,588,367 100,270,955 Distributions reinvested 206,021 4,120,329 85,074 1,470,072 Redemptions (3,354,496) (65,931,704) (5,130,203) (91,076,386) ------------ ------------ ------------ ------------ Net increase (decrease) (728,261) (14,154,820) 543,238 10,664,641
See Accompanying Notes to Financial Statements. | 155 STATEMENTS OF CHANGES IN NET ASSETS - CAPITAL STOCK ACTIVITY ___________________ Columbia Funds
BALANCED FUND ------------------------------------------------------------ (UNAUDITED) SIX MONTHS ENDED YEAR ENDED FEBRUARY 28, 2005 AUGUST 31, 2004 (a) ---------------------------- ---------------------------- SHARES DOLLARS ($) SHARES DOLLARS ($) ------------ ------------ ------------ ------------ CLASS A Subscriptions 41,594 864,375 110,630 2,249,214 Distributions reinvested 1,251 25,845 1,059 21,473 Redemptions (34,357) (711,464) (16,827) (342,215) ------------ ------------ ------------ ------------ Net increase (decrease) 8,488 178,756 94,862 1,928,472 CLASS B Subscriptions 53,436 1,099,754 254,329 5,127,102 Distributions reinvested 2,204 45,745 1,523 30,867 Redemptions (49,590) (1,015,139) (63,198) (1,271,030) ------------ ------------ ------------ ------------ Net increase (decrease) 6,050 130,360 192,654 3,886,939 CLASS C Subscriptions 7,685 158,503 41,424 839,284 Distributions reinvested 226 4,713 136 2,777 Redemptions (4,608) (95,273) (4,752) (94,839) ------------ ------------ ------------ ------------ Net increase 3,303 67,943 36,808 747,222 CLASS D Subscriptions 30 622 7,349 141,785 Distributions reinvested 110 2,275 194 3,858 Redemptions (2,675) (53,814) (29,534) (593,961) ------------ ------------ ------------ ------------ Net decrease (2,535) (50,917) (21,991) (448,318) CLASS G Subscriptions -- -- -- -- Distributions reinvested -- -- -- -- Redemptions -- -- -- -- ------------ ------------ ------------ ------------ Net decrease -- -- -- -- CLASS T Subscriptions -- -- -- -- Distributions reinvested -- -- -- -- Redemptions -- -- -- -- ------------ ------------ ------------ ------------ Net decrease -- -- -- -- CLASS Z Subscriptions 1,151,535 23,667,230 3,762,668 75,662,935 Distributions reinvested 255,090 5,252,140 535,817 10,708,630 Redemptions (8,012,294) (165,609,838) (13,282,884) (267,556,516) ------------ ------------ ------------ ------------ Net decrease (6,605,669) (136,690,468) (8,984,399) (181,184,951)
(a) Class C shares were initially offered on October 13, 2003. 156 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ Columbia Funds
SHORT TERM BOND FUND ------------------------------------------------------------ (UNAUDITED) SIX MONTHS ENDED YEAR ENDED FEBRUARY 28, 2005 AUGUST 31, 2004 (a) ---------------------------- ---------------------------- SHARES DOLLARS ($) SHARES DOLLARS ($) ------------ ------------ ------------ ------------ CLASS A Subscriptions 445,385 3,839,593 2,363,890 20,470,127 Distributions reinvested 30,443 262,102 55,629 481,353 Redemptions (924,013) (7,966,221) (3,483,902) (30,155,847) ------------ ------------ ------------ ------------ Net increase (decrease) (448,185) (3,864,526) (1,064,383) (9,204,367) CLASS B Subscriptions 274,069 2,362,441 1,020,370 8,811,024 Distributions reinvested 18,846 162,242 28,513 246,689 Redemptions (622,351) (5,363,653) (1,268,886) (10,976,173) ------------ ------------ ------------ ------------ Net increase (decrease) (329,436) (2,838,970) (220,003) (1,918,460) CLASS C Subscriptions 104,530 901,678 446,619 3,866,656 Distributions reinvested 3,414 29,394 3,243 28,007 Redemptions (106,031) (914,556) (87,871) (758,972) ------------ ------------ ------------ ------------ Net increase 1,913 16,516 361,991 3,135,691 CLASS D Subscriptions 25,625 220,738 195,345 1,693,396 Distributions reinvested 9,556 82,277 25,582 221,473 Redemptions (284,050) (2,449,498) (1,232,826) (10,651,859) ------------ ------------ ------------ ------------ Net decrease (248,869) (2,146,483) (1,011,899) (8,736,990) CLASS G Subscriptions 42 360 584 5,059 Distributions reinvested 1,048 9,026 2,071 17,922 Redemptions (20,568) (177,322) (67,631) (585,284) ------------ ------------ ------------ ------------ Net decrease (19,478) (167,936) (64,976) (562,303) CLASS T Subscriptions 24,195 208,880 49,312 426,415 Distributions reinvested 26,447 227,679 51,571 446,329 Redemptions (229,530) (1,978,150) (926,216) (7,999,639) ------------ ------------ ------------ ------------ Net decrease (178,888) (1,541,591) (825,333) (7,126,895) CLASS Z Subscriptions 10,657,099 91,849,851 27,479,655 237,930,286 Distributions reinvested 200,798 1,728,910 389,324 3,368,689 Redemptions (12,942,397) (111,487,818) (27,927,420) (241,618,684) ------------ ------------ ------------ ------------ Net decrease (2,084,500) (17,909,057) (58,441) (319,709)
See Accompanying Notes to Financial Statements. | 157 STATEMENTS OF CHANGES IN NET ASSETS - CAPITAL STOCK ACTIVITY ___________________ Columbia Funds
FIXED INCOME SECURITIES FUND ------------------------------------------------------------ (UNAUDITED) SIX MONTHS ENDED YEAR ENDED FEBRUARY 28, 2005 AUGUST 31, 2004 (a) ---------------------------- ---------------------------- SHARES DOLLARS ($) SHARES DOLLARS ($) ------------ ------------ ------------ ------------ CLASS A Subscriptions 281,863 3,792,599 428,638 5,773,085 Distributions reinvested 24,644 330,221 23,362 314,190 Redemptions (182,827) (2,450,140) (220,544) (2,972,153) ------------ ------------ ------------ ------------ Net increase 123,680 1,672,680 231,456 3,115,122 CLASS B Subscriptions 16,459 220,539 118,362 1,602,183 Distributions reinvested 6,591 88,328 8,019 107,908 Redemptions (41,136) (553,271) (135,602) (1,820,197) ------------ ------------ ------------ ------------ Net increase (decrease) (18,086) (244,404) (9,221) (110,106) CLASS C Subscriptions 7,457 100,512 17,216 232,958 Distributions reinvested 332 4,452 209 2,809 Redemptions (2,871) (38,533) (5,682) (76,813) ------------ ------------ ------------ ------------ Net increase (decrease) 4,918 66,431 11,743 158,954 CLASS D Subscriptions 962 12,850 2,595 34,899 Distributions reinvested 1,878 25,171 3,148 42,410 Redemptions (19,577) (263,015) (73,680) (981,085) ------------ ------------ ------------ ------------ Net decrease (16,737) (224,994) (67,937) (903,776) CLASS Z Subscriptions 1,597,478 21,480,088 5,273,336 71,044,891 Distributions reinvested 635,883 8,524,750 1,165,214 15,695,834 Redemptions (6,314,865) (84,758,101) (20,329,678) (273,815,667) ------------ ------------ ------------ ------------ Net decrease (4,081,504) (54,753,263) (13,891,128) (187,074,942)
(a) Class C shares were initially offered on October 13, 2003. 158 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ Columbia Funds
NATIONAL MUNICIPAL BOND FUND ------------------------------------------------------------ (UNAUDITED) SIX MONTHS ENDED YEAR ENDED FEBRUARY 28, 2005 AUGUST 31, 2004 (a) ---------------------------- ---------------------------- SHARES DOLLARS ($) SHARES DOLLARS ($) ------------ ------------ ------------ ------------ CLASS A Subscriptions 163,379 1,678,097 99,258 1,025,824 Distributions reinvested 2,844 29,070 2,972 30,460 Redemptions (140,607) (1,440,260) (16,680) (167,045) ------------ ------------ ------------ ------------ Net increase 25,616 266,907 85,550 889,239 CLASS B Subscriptions 8,632 88,695 27,156 280,129 Distributions reinvested 976 9,964 1,592 16,368 Redemptions (8,103) (83,473) (13,453) (138,405) ------------ ------------ ------------ ------------ Net increase (decrease) 1,505 15,186 15,295 158,092 CLASS C Subscriptions 335 3,462 79,238 814,330 Distributions reinvested 379 3,865 1,646 16,916 Redemptions (996) (10,176) (45,604) (462,894) ------------ ------------ ------------ ------------ Net increase (decrease) (282) (2,849) 35,280 368,352 CLASS D Subscriptions 4 45 4,795 49,669 Distributions reinvested 482 4,916 831 8,544 Redemptions (16,976) (174,039) (7,399) (75,050) ------------ ------------ ------------ ------------ Net decrease (16,490) (169,078) (1,773) (16,837) CLASS Z Subscriptions 128,058 1,315,652 708,002 7,280,818 Distributions reinvested 19,231 196,503 45,767 470,822 Redemptions (516,864) (5,299,965) (1,011,506) (10,382,780) ------------ ------------ ------------ ------------ Net decrease (369,575) (3,787,810) (257,737) (2,631,140)
See Accompanying Notes to Financial Statements. | 159 STATEMENTS OF CHANGES IN NET ASSETS - CAPITAL STOCK ACTIVITY ___________________ Columbia Funds
OREGON MUNICIPAL BOND FUND ------------------------------------------------------------ (UNAUDITED) SIX MONTHS ENDED YEAR ENDED FEBRUARY 28, 2005 AUGUST 31, 2004 (a) ---------------------------- ---------------------------- SHARES DOLLARS ($) SHARES DOLLARS ($) ------------ ------------ ------------ ------------ CLASS A Subscriptions 30,816 383,230 170,654 2,095,832 Distributions reinvested 3,381 42,026 6,574 81,626 Redemptions (6,751) (84,126) (56,206) (688,255) ------------ ------------ ------------ ------------ Net increase 27,446 341,130 121,022 1,489,203 CLASS B Subscriptions 6,843 85,045 35,938 446,223 Distributions reinvested 932 11,579 2,314 28,769 Redemptions (2,763) (34,357) (24,250) (302,376) ------------ ------------ ------------ ------------ Net increase (decrease) 5,012 62,267 14,002 172,616 CLASS C Subscriptions 11,613 144,882 22,201 277,202 Distributions reinvested 287 3,560 227 2,808 Redemptions (1,811) (22,535) (84) (1,027) ------------ ------------ ------------ ------------ Net increase 10,089 125,907 22,344 278,983 CLASS D Subscriptions -- -- 12,020 148,564 Distributions reinvested 841 10,449 2,010 24,984 Redemptions (1,262) (15,700) (7,665) (95,185) ------------ ------------ ------------ ------------ Net increase (decrease) (421) (5,251) 6,365 78,363 CLASS Z Subscriptions 1,506,444 18,757,235 3,104,735 38,548,478 Distributions reinvested 588,726 7,320,118 1,524,565 18,948,258 Redemptions (3,134,594) (39,033,484) (9,361,486) (115,760,679) ------------ ------------ ------------ ------------ Net increase (decrease) (1,039,424) (12,956,131) (4,732,186) (58,263,943)
(a) Class C shares were initially offered on October 13, 2003. 160 | See Accompanying Notes to Financial Statements. ________________________________________________________________________________ Columbia Funds
HIGH YIELD FUND ------------------------------------------------------------ (UNAUDITED) SIX MONTHS ENDED YEAR ENDED FEBRUARY 28, 2005 AUGUST 31, 2004 (a) ---------------------------- ---------------------------- SHARES DOLLARS ($) SHARES DOLLARS ($) ------------ ------------ ------------ ------------ CLASS A Subscriptions 7,689,986 67,713,325 26,673,537 230,909,589 Distributions reinvested 1,028,495 9,056,105 1,708,530 14,793,686 Redemptions (7,567,598) (66,537,095) (12,505,103) (108,035,805) ------------ ------------ ------------ ------------ Net increase 1,150,883 10,232,335 15,876,964 137,667,470 CLASS B Subscriptions 542,602 4,776,180 3,063,956 26,566,619 Distributions reinvested 196,946 1,734,163 405,219 3,509,869 Redemptions (1,005,051) (8,844,126) (2,325,212) (20,086,982) ------------ ------------ ------------ ------------ Net increase (decrease) (265,503) (2,333,783) 1,143,963 9,989,506 CLASS C Subscriptions 560,120 4,936,171 2,692,176 23,449,925 Distributions reinvested 36,769 323,756 40,122 346,368 Redemptions (331,537) (2,920,671) (416,181) (3,598,943) ------------ ------------ ------------ ------------ Net increase 265,352 2,339,256 2,316,117 20,197,350 CLASS D Subscriptions 104,805 923,070 1,187,729 10,250,062 Distributions reinvested 142,094 1,251,256 379,149 3,285,854 Redemptions (1,873,050) (16,485,758) (3,773,325) (32,589,124) ------------ ------------ ------------ ------------ Net increase (decrease) (1,626,151) (14,311,432) (2,206,447) (19,053,208) CLASS Z Subscriptions 19,981,333 175,979,971 71,607,065 621,117,899 Distributions reinvested 1,919,929 16,905,677 5,291,757 45,884,199 Redemptions (19,837,117) (174,591,962) (81,442,188) (706,874,478) ------------ ------------ ------------ ------------ Net increase (decrease) 2,064,145 18,293,686 (4,543,366) (39,872,380)
See Accompanying Notes to Financial Statements. | 161 STATEMENTS OF CHANGES IN NET ASSETS - CAPITAL STOCK ACTIVITY ___________________ Columbia Funds
DAILY INCOME COMPANY ------------------------------------------------------------ (UNAUDITED) SIX MONTHS ENDED YEAR ENDED FEBRUARY 28, 2005 AUGUST 31, 2004 ---------------------------- ---------------------------- SHARES DOLLARS ($) SHARES DOLLARS ($) ------------ ------------ ------------ ------------ CLASS Z Subscriptions 189,906,515 189,906,516 522,717,108 522,717,108 Distributions reinvested 3,436,414 3,436,414 2,669,462 2,669,462 Redemptions (308,246,750) (308,246,751) (762,436,905) (762,436,905) ------------ ------------ ------------ ------------ Net decrease (114,903,821) (114,903,821) (237,050,335) (237,050,335)
162 | See Accompanying Notes to Financial Statements. NOTES TO FINANCIAL STATEMENTS __________________________________________________ February 28, 2005 (Unaudited) Columbia Funds NOTE 1. ORGANIZATION The Columbia Funds are registered under the Investment Company Act of 1940 (the "1940 Act"), as amended, as open-end management investment companies. Information presented in these financial statements pertains to the following Funds (individually referred to as a "Fund", collectively referred to as the "Funds"): Columbia Common Stock Fund Columbia Growth Fund Columbia International Stock Fund Columbia Mid Cap Growth Fund Columbia Small Cap Growth Fund Columbia Real Estate Equity Fund Columbia Technology Fund Columbia Strategic Investor Fund Columbia Balanced Fund Columbia Short Term Bond Fund Columbia Fixed Income Securities Fund Columbia National Municipal Bond Fund Columbia Oregon Municipal Bond Fund Columbia High Yield Fund Columbia Daily Income Company All Funds are diversified except for the Columbia Real Estate Equity Fund, Columbia Technology Fund and Columbia Oregon Municipal Bond Fund, which are non-diversified. INVESTMENT GOALS The Columbia Common Stock Fund seeks capital appreciation by investing primarily in common stocks of large capitalization, well-established companies. The Columbia Growth Fund seeks capital appreciation by investing in stocks of companies expected to experience long-term, above average earnings growth. The Columbia International Stock Fund seeks long-term capital appreciation by investing in stocks issued by companies from at least three countries outside the United States. The Columbia Mid Cap Growth Fund seeks significant capital appreciation by investing in stocks of companies with a market capitalization, at the time of initial purchase, equal to or less than the largest stock in the Russell Midcap Index. The Columbia Small Cap Growth Fund seeks capital appreciation by investing in stocks of companies with a market capitalization, at the time of initial purchase, equal to or less than the largest stock in the S&P SmallCap 600 Index. The Columbia Real Estate Equity Fund seeks capital appreciation and above-average income by investing in stocks of companies principally engaged in the real estate industry, including real estate investment trusts (REITs). The Columbia Technology Fund seeks capital appreciation by investing in stocks of technology companies that may benefit from technological improvements, advancements or developments. The Columbia Strategic Investor Fund seeks long-term growth of capital by using a "value" approach to investing primarily in common stocks. The Columbia Balanced Fund seeks high total return by investing in common stocks and debt securities. The Columbia Short Term Bond Fund seeks a high level of current income consistent with a high degree of principal stability by investing primarily in short-term, investment-grade, fixed income securities. The Columbia Fixed Income Securities Fund seeks a high level of income by investing in a broad range of debt securities with intermediate to long-term maturities. The Columbia National Municipal Bond Fund seeks a high level of income exempt from federal income tax by investing primarily in municipal securities issued by state and local governments, their agencies and authorities, as well as the District of Columbia and U.S. territories and possessions. The Columbia Oregon Municipal Bond Fund seeks a high level of income exempt from federal and Oregon income tax by investing primarily in municipal securities issued by the state of Oregon. The Columbia High Yield Fund seeks a high level of income, with capital appreciation as a secondary goal, by investing in non-investment-grade, corporate debt securities. The Columbia Daily Income Company seeks a high level of income consistent with the maintenance of liquidity and the preservation of capital by investing primarily in high quality money market securities. FUND SHARES Each Fund may issue one billion shares. Each of the Funds, except the Columbia Growth Fund, Columbia Mid Cap Growth Fund, Columbia Small Cap Growth Fund, Columbia Short Term Bond Fund and Columbia Daily Income Company, offer five classes of shares: Class A, Class B, Class C, Class D and Class Z. The Columbia Small Cap Growth Fund and Columbia Daily Income Company offer only Class Z shares. The Columbia Growth Fund offers six classes of shares: Class A, Class B, Class C, Class D, Class G and Class Z. The Columbia Mid Cap Growth Fund and Columbia Short Term Bond Fund offer seven classes of shares: 163 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Funds Class A, Class B, Class C, Class D, Class G, Class T and Class Z. Each share class has its own expense structure. Class A and Class T shares are subject to a front-end sales charge of based on the amount of initial investment. Class A and Class T shares purchased without an initial sales charge in accounts aggregating $1 million to $25 million at the time of purchase are subject to a 1.00% contingent deferred sales charge ("CDSC") on shares sold within eighteen months of the time of purchase. Class B and Class G shares are subject to a maximum CDSC of 5.00% based upon the holding period after purchase. Class B shares will convert to Class A shares in a certain number of years after purchase, depending on the program under which shares were purchased. Class G shares will convert to Class T shares in eight years after purchase. Class C shares are subject to a 1.00% CDSC on shares sold within one year after purchase. Class D shares are subject to a front-end sales charge of 1.00% and a 1.00% CDSC on shares sold within one year after purchase. Class D shares are closed to new investors. In addition, the Class D sales charge of 1.00% is waived for purchases of Class D shares by existing class D shareholders. Class Z shares are offered continuously at net asset value. There are certain restrictions on the purchase of Class Z shares, as described in each Fund's prospectus. NOTE 2. SIGNIFICANT ACCOUNTING POLICIES USE OF ESTIMATES The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. The following is a summary of significant accounting policies consistently followed by the Funds in the preparation of their financial statements. SECURITY VALUATION Equity securities are valued at the last sale price on the principal exchange on which they trade, except for securities traded on the NASDAQ, which are valued at the NASDAQ official close price. Unlisted securities or listed securities for which there were no sales during the day are valued at the closing bid price on such exchanges or over-the-counter markets. Debt securities generally are valued by a pricing service approved by the Funds' Board of Trustees, based upon market transactions for normal, institutional-size trading units of similar securities. The services may use various pricing techniques which take into account appropriate factors such as yield, quality, coupon rate, maturity, type of issue, trading characteristics and other data, as well as broker quotes. Debt securities for which quotations are readily available are valued at an over-the-counter or exchange bid quotation. Certain debt securities, which tend to be more thinly traded and of lesser quality, are priced based on fundamental analysis of the financial condition of the issuer and the estimated value of any collateral. Valuations developed through pricing techniques may vary from the actual amounts realized upon sale of the securities, and the potential variation may be greater for those securities valued using fundamental analysis. Short-term debt obligations maturing within 60 days are valued at amortized cost, which approximates market value. Investments in other investment companies are valued at net asset value. Futures contracts are valued at the settlement price established each day by the board of trade or exchange on which they are traded. Options are valued at the last reported sale price, or in the absence of a sale, the mean between the last quoted bid and ask price. Foreign securities are generally valued at the last sale price on the foreign exchange or market on which they trade. If any foreign share prices are not readily available as a result of limited share activity, the securities are valued at the last sale price of the local shares in the principal market in which such securities are normally traded. Generally, trading in foreign securities is substantially completed each day at various times prior to the close 164 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Funds of the New York Stock Exchange ("NYSE"). The values of such securities used in computing the net asset value of the Funds' shares are determined as of such times. Foreign currency exchange rates are generally determined at 2:00 p.m. Eastern (U.S.) time. Occasionally, events affecting the values of such foreign securities and such exchange rates may occur between the times at which they are determined and the close of the customary trading session of the NYSE, which would not be reflected in the computation of the Funds' net asset value. If events materially affecting the values of such foreign securities occur and it is determined that market quotations are not reliable, then these foreign securities will be valued at their fair value using procedures approved by the Board of Trustees. The Funds may use a systematic fair valuation model provided by an independent third party to value securities principally traded in foreign markets in order to adjust for possible stale pricing that may occur between the close of the foreign exchanges and the time for valuation. If a security is valued at a "fair value", such value is likely to be different from the last quoted market price for the security. Investments for which market quotations are not readily available, or have quotations which management believes are not appropriate, are valued at fair value under procedures approved by the Board of Trustees. Securities in the Columbia Daily Income Company are valued utilizing the amortized cost valuation method permitted in accordance with Rule 2a-7 under the 1940 Act provided certain conditions are met. This method involves valuing a portfolio security initially at its cost and thereafter assuming a constant accretion or amortization to maturity of any discount or premium, respectively. SECURITY TRANSACTIONS Security transactions are accounted for on the trade date. Cost is determined and gains (losses) are based upon the specific identification method for both financial statement and federal income tax purposes. FUTURES CONTRACTS Certain Funds may invest in municipal and U.S. Treasury futures contracts. The Funds will invest in these instruments to hedge against the effects of changes in the value of portfolio securities due to anticipated changes in interest rates and/or market conditions, for duration management, or when the transactions are economically appropriate to the reduction of risk inherent in the management of the Funds and not for trading purposes. The use of futures contracts involves certain risks, which include: (1) imperfect correlation between the price movement of the instruments and the underlying securities, (2) inability to close out positions due to differing trading hours, or the temporary absence of a liquid market, for either the instrument or the underlying securities, or (3) an inaccurate prediction by Columbia Management Advisors, Inc. of the future direction of interest rates. Any of these risks may involve amounts exceeding the variation margin recorded in the Funds' Statement of Assets and Liabilities at any given time. Upon entering into a futures contract, each Fund deposits cash or securities with the broker in an amount sufficient to meet the initial margin requirement. Subsequent payments are made or received by the Funds equal to the daily change in the contract value and are recorded as variation margin receivable or payable and offset in unrealized gains or losses. Each Fund also identifies portfolio securities as segregated with the custodian in a separate account in an amount equal to the futures contract. The Funds recognize a realized gain or loss when the contract is closed or expires. OPTIONS Certain Funds may write call and put options on futures they own or in which they may invest. Writing put options tends to increase the Funds' exposure to the underlying instrument. Writing call options tends to decrease the Funds' exposure to the underlying instrument. When the Funds write a call or put option, an amount equal to the premium received is recorded as a liability and subsequently marked-to-market to reflect the current value of the option written. Premiums received from writing options which expire are treated as realized gains. Premiums received from writing options which are exercised or closed are added to the proceeds or offset against the amounts paid on the underlying future transaction to determine the realized gain or loss. Each Fund as a writer of an option has no control over whether the underlying future may be sold (call) or purchased (put) and as a result bears the market risk of an unfavorable change in the price of the future underlying the written option. There is the risk the 165 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Funds Funds may not be able to enter into a closing transaction because of an illiquid market. Certain Funds may also purchase put and call options. Purchasing call options tends to increase the Funds' exposure to the underlying instrument. Purchasing put options tends to decrease the Funds' exposure to the underlying instrument. Each Fund pays a premium, which is included in the Funds' Statement of Assets and Liabilities as an investment and subsequently marked-to-market to reflect the current value of the option. The risk associated with purchasing put and call options is limited to the premium paid. Premiums paid for purchasing options which expire are treated as realized losses. Premiums paid for purchasing options which are exercised or closed are added to the amounts paid or offset against the proceeds on the underlying future transaction to determine the realized gain or loss. The Funds' custodian will set aside cash or liquid portfolio securities equal to the amount of the written options contract commitment in a separate account. FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS Forward foreign currency exchange contracts are agreements to exchange one currency for another at a future date at a specified price. These contracts are used to minimize the exposure to foreign exchange rate fluctuations during the period between trade and settlement date of the contracts. Certain Funds may utilize forward foreign currency exchange contracts in connection with the settlement of purchases and sales of securities. Certain Funds may also enter into these contracts to hedge certain other foreign currency denominated assets. Contracts to buy generally are used to acquire exposure to foreign currencies, while contracts to sell are used to hedge the Funds' investments against currency fluctuations. Forward currency contracts are valued daily at the current exchange rate of the underlying currency, resulting in unrealized gains (losses) which become realized at the time the foreign currency contracts are closed or mature. Realized and unrealized gains (losses) arising from such transactions are included in net realized and unrealized gains (losses) on foreign currency transactions. The use of forward currency contracts does not eliminate fluctuations in the prices of the Funds' portfolio securities. While the maximum potential loss from such contracts is the aggregate face value in U.S. dollars at the time the contract was opened, exposure is typically limited to the change in value of the contract (in U.S. dollars) over the period it remains open. The Funds could also be exposed to risk if the counterparties of the contracts are unable to fulfill the terms of the contracts. REPURCHASE AGREEMENTS Each Fund may engage in repurchase agreement transactions with institutions that the Funds' investment advisor has determined are creditworthy. Each Fund, through its custodian, receives delivery of underlying securities collateralizing a repurchase agreement. Collateral is at least equal, at all times, to the value of the repurchase obligation including interest. A repurchase agreement transaction involves certain risks in the event of default or insolvency of the counterparty. These risks include possible delays or restrictions upon each Fund's ability to dispose of the underlying securities and a possible decline in the value of the underlying securities during the period while the Funds seek to assert their rights. INCOME RECOGNITION Interest income is recorded on the accrual basis. Premium and discount are amortized and accreted, respectively, on all debt securities. Corporate actions and dividend income are recorded on the ex-date, except for certain foreign securities which are recorded as soon after ex-date as the Funds become aware of such, net of non-reclaimable tax withholdings. Awards from class action litigation are recorded as a reduction of cost if the Funds still own the applicable securities on the payment date. If the Funds no longer own the applicable securities, the proceeds are recorded as realized gains. The Funds estimate components of distributions from real estate investment trusts (REITs). Distributions received in excess of income are recorded as a reduction of the cost of the related investments. If the Funds no longer own the applicable securities, any distributions received in excess of income are recorded as realized gains. FOREIGN CURRENCY TRANSACTIONS The values of all assets and liabilities quoted in foreign currencies are translated into U.S. dollars at that day's exchange rates. Net realized and unrealized gains (losses) on foreign currency transactions include gains (losses) arising from the fluctuation in exchange rates between trade and settlement dates on securities 166 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Funds transactions, gains (losses) arising from the disposition of foreign currency and currency gains (losses) between the accrual and payment dates on dividends, interest income and foreign withholding taxes. For financial statement purposes, the Funds do not distinguish that portion of gains (losses) on investments which is due to changes in foreign exchange rates from that which is due to changes in market prices of the investments. Such fluctuations are included with the net realized and unrealized gains (losses) on investments. DETERMINATION OF CLASS NET ASSET VALUES All income, expenses (other than class-specific expenses, as shown on the Statements of Operations) and realized and unrealized gains (losses) are allocated to each class of the Funds on a daily basis for purposes of determining the net asset value of each class. Income and expenses are allocated to each class based on the settled shares method, while realized and unrealized gains (losses) are allocated based on the relative net assets of each class for the Columbia Short Term Bond Fund, Columbia Fixed Income Securities Fund, Columbia National Municipal Bond Fund, Columbia Oregon Municipal Bond Fund and Columbia High Yield Fund. For all other Funds' income, expenses (other than class-specific expenses, as shown on the Statements of Operations), and realized and unrealized gains (losses), are allocated to each class of a Fund, based on the relative net assets of each class. FEDERAL INCOME TAX STATUS Each Fund intends to qualify each year as a "regulated investment company" under Subchapter M of the Internal Revenue Code, as amended, and will distribute substantially all of its taxable income, if any, for its tax year, and as such will not be subject to federal income taxes. In addition, each Fund intends to distribute in each calendar year substantially all of its net investment income, capital gains and certain other amounts, if any, such that each Fund should not be subject to federal excise tax. Therefore, no federal income or excise tax provision is recorded. FOREIGN CAPITAL GAINS TAXES Realized gains in certain countries may be subject to foreign taxes at the fund level, at rates ranging from approximately 10% to 15%. The Funds accrue for such foreign taxes on net realized and unrealized gains at the appropriate rate for each jurisdiction. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS Dividends from net investment income of the Columbia Common Stock Fund, Columbia Growth Fund, Columbia International Stock Fund, Columbia Mid Cap Growth Fund, Columbia Small Cap Growth Fund, Columbia Technology Fund and Columbia Strategic Investor Fund are declared and paid annually. Dividends from net investment income of the Columbia Real Estate Equity Fund and Columbia Balanced Fund are declared and paid quarterly. Dividends from net investment income of the Columbia Short Term Bond Fund, Columbia Fixed Income Securities Fund, Columbia National Municipal Bond Fund, Columbia Oregon Municipal Bond Fund, and Columbia High Yield Fund are declared daily and paid monthly. Dividends from net investment income of the Columbia Daily Income Company are declared daily and paid daily. Net realized capital gains, if any, are distributed at least annually for all Funds. Additional distributions of net investment income and capital gains for each Fund may be made at the discretion of the Board of Trustees in accordance with federal income tax regulations. 167 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Funds NOTE 3.FEDERAL TAX INFORMATION The tax character of distributions paid during the year ended August 31, 2004 was as follows:
TAX-EXEMPT ORDINARY LONG-TERM INCOME INCOME* CAPITAL GAINS TOTAL ----------- ------------- ------------- ------------ Columbia Common Stock Fund .................................. $ -- $ 2,317,519 $ -- $ 2,317,519 Columbia International Stock Fund ........................... -- 1,290,808 -- 1,290,808 Columbia Real Estate Equity Fund ............................ -- 32,144,710 7,814,165 39,958,875 Columbia Strategic Investor Fund ............................ -- 1,745,832 -- 1,745,832 Columbia Balanced Fund ...................................... -- 10,897,644 -- 10,897,644 Columbia Short Term Bond Fund ............................... -- 11,567,348 -- 11,567,348 Columbia Fixed Income Securities Fund ....................... -- 17,387,062 -- 17,387,062 Columbia National Municipal Bond Fund ....................... 540,162 7,054 115,247 662,463 Columbia Oregon Municipal Bond Fund ......................... 18,792,984 95,636 5,369,297 24,257,917 Columbia High Yield Fund .................................... -- 110,686,435 -- 110,686,435 Columbia Daily Income Fund .................................. -- 2,925,450 -- 2,925,450
* For tax purposes short-term capital gains distributions, if any, are considered ordinary income distributions. Unrealized appreciation and depreciation at February 28, 2005, based on cost of investments for federal income tax purposes, and excluding any unrealized appreciation and depreciation from changes in the value of assets and liabilities resulting from changes in exchange rates, was:
NET UNREALIZED UNREALIZED UNREALIZED APPRECIATION APPRECIATION DEPRECIATION (DEPRECIATION) ------------ ------------- ------------ Columbia Common Stock Fund .................................. $ 26,895,967 $ (4,289,490) $ 22,606,477 Columbia Growth Fund ........................................ 102,025,070 (10,885,382) 91,139,688 Columbia International Stock Fund ........................... 115,994,991 (4,108,291) 111,886,700 Columbia Mid Cap Growth Fund ................................ 141,030,720 (19,495,654) 121,535,066 Columbia Small Cap Growth Fund .............................. 33,691,681 (10,175,740) 23,515,941 Columbia Real Estate Equity Fund ............................ 319,894,449 (4,274,433) 315,620,016 Columbia Technology Fund .................................... 6,012,208 (701,893) 5,310,315 Columbia Strategic Investor Fund ............................ 91,769,604 (2,820,802) 88,948,802 Columbia Balanced Fund ...................................... 25,908,716 (6,081,843) 19,826,873 Columbia Short Term Bond Fund ............................... 1,334,773 (3,919,257) (2,584,484 Columbia Fixed Income Securities Fund ....................... 4,968,605 (2,346,894) 2,621,711 Columbia National Municipal Bond Fund ....................... 471,816 (10,471) 461,345 Columbia Oregon Municipal Bond Fund ......................... 22,887,298 (2,215,521) 20,671,777 Columbia High Yield Fund .................................... 53,569,592 (3,930,574) 49,639,018
168 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Funds The following capital loss carryforwards, determined as of August 31, 2004, may be available to reduce taxable income arising from future net realized gains on investments, if any, to the extent permitted by the Internal Revenue Code:
YEAR OF EXPIRATION 2006 2007 2008 2009 2010 2011 TOTAL -------- ----------- ----------- ------------- -------------- ------------ ------------- Columbia Common Stock Fund ................. $ -- $ -- $ -- $ -- $ 49,129,624 $ 18,452,682 $ 67,582,306 Columbia Growth Fund ....... -- 12,669,149 7,477,479 97,550,243 201,393,752 43,705,919 362,796,542 Columbia International Stock Fund ................. -- 3,992,699 4,566,169 659,591 12,463,383 9,023,330 30,705,172 Columbia Mid Cap Growth Fund ................ -- -- 13,161,549 15,799,915 95,645,403 4,954,493 129,561,360 Columbia Small Cap Growth Fund ................ -- -- -- -- 97,865,374 -- 97,865,374 Columbia Technology Fund ... -- -- -- -- 1,969,604 -- 1,969,604 Columbia Balanced Fund ..... -- -- -- -- 56,019,395 10,165,186 66,184,581 Columbia Short Term Bond Fund .................. 256,035 -- 1,103,186 -- -- -- 1,359,221 Columbia High Yield Fund ... -- -- -- -- 16,290,578 -- 16,290,578 Columbia Daily Income Company .................... -- -- -- -- -- 320 320
Of the capital loss carryforwards attributable to Columbia Growth Fund, $20,146,628 ($12,669,149 expiring 08/31/07 and $7,477,479 expiring 08/31/08) remains from the Columbia Growth Fund's merger with Galaxy Large Cap Growth Fund. Of the capital loss carryforwards attributable to Columbia International Stock Fund, $5,920,504 ($3,992,699 expiring 08/31/07 and $1,927,805 expiring 08/31/08) and $3,297,955 ($2,638,364 expiring 08/31/08 and $659,591 expiring 08/31/09) remain from the Columbia International Stock Fund's merger with Liberty Newport International Equity Fund and Stein Roe International Fund, respectively. Of the capital loss carryforwards attributable to Columbia Mid Cap Growth Fund, $6,884,210 ($5,507,368 expiring 08/31/08 and $1,376,842 expiring 08/31/09) and $19,700,034 ($7,654,181 expiring 08/31/08 and $12,045,853 expiring 08/31/09) remain from the Columbia Mid Cap Growth Fund's merger with Liberty Mid Cap Growth Fund and Stein Roe Capital Opportunities Fund, respectively. Of the capital loss carryforwards attributable to Columbia Short Term Bond Fund, $1,359,221 ($256,035 expiring 08/31/06 and $1,103,186 expiring 08/31/08) remain from the Columbia Short Term Bond Fund's merger with Galaxy Short Term Bond Fund. NOTE 4. FEES AND COMPENSATION PAID TO AFFILIATES INVESTMENT ADVISORY FEE Columbia Management Advisors, Inc. ("Columbia"), an indirect wholly owned subsidiary of Bank of America Corporation ("BOA"), is the investment advisor to the Funds and provides administrative and other services to the Funds. Columbia receives a monthly investment advisory fee based on the each Fund's average daily net assets at the following annual rates: ANNUAL FEE RATE ------ Columbia Common Stock Fund 0.600% Columbia Real Estate Equity Fund 0.750% Columbia Strategic Investor Fund 0.750% Columbia Balanced Fund 0.500% Columbia Fixed Income Securities Fund 0.500% Columbia National Municipal Bond Fund 0.500% Columbia Oregon Municipal Bond Fund 0.500% 169 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Funds
FEES ON FEES ON FEES ON FEES ON FEES ON FEES ON FEES ON AVERAGE AVERAGE AVERAGE AVERAGE AVERAGE AVERAGE AVERAGE NET ASSETS NET ASSETS NET ASSETS NET ASSETS NET ASSETS NET ASSETS NET ASSETS FIRST NEXT NEXT NEXT NEXT NEXT OVER $200 $300 $500 $500 $1.5 $3 $6 MILLION MILLION MILLION MILLION BILLION BILLION BILLION ---------- ---------- ---------- ----------- ----------- ---------- ---------- Columbia Growth Fund 0.750% 0.625% 0.500% 0.500% 0.500% 0.500% 0.500% Columbia International Stock Fund 0.870% 0.870% 0.820% 0.770% 0.720% 0.700% 0.680% Columbia Mid Cap Growth Fund 0.820% 0.820% 0.750% 0.720% 0.670% 0.670% 0.670% Columbia Small Cap Growth Fund 0.870% 0.870% 0.820% 0.770% 0.770% 0.770% 0.770% Columbia Technology Fund 0.870% 0.870% 0.820% 0.770% 0.770% 0.770% 0.770% Columbia Short Term Bond Fund 0.450% 0.450% 0.400% 0.400% 0.400% 0.400% 0.400% Columbia High Yield Fund 0.600% 0.600% 0.550% 0.520% 0.490% 0.490% 0.490% Columbia Daily Income Company 0.500% 0.500% 0.450% 0.400% 0.400% 0.400% 0.400%
Prior to November 1, 2004, Columbia received a monthly investment advisory fee based on each Fund's average daily net assets as follows: ANNUAL FEE RATE ------ Columbia Common Stock Fund 0.600% Columbia Small Cap Growth Fund 1.000% Columbia Real Estate Equity Fund 0.750% Columbia Technology Fund 1.000% Columbia Strategic Investor Fund 0.750% Columbia Balanced Fund 0.500% Columbia Short Term Bond Fund 0.500% Columbia Fixed Income Securities Fund 0.500% Columbia National Municipal Bond Fund 0.500% Columbia Oregon Municipal Bond Fund 0.500% Columbia High Yield Fund 0.600% FEES ON FEES ON FEES ON FEES ON AVERAGE AVERAGE AVERAGE AVERAGE NET ASSETS NET ASSETS NET ASSETS NET ASSETS FIRST $200 NEXT $300 NEXT $500 OVER $1 MILLION MILLION MILLION BILLION ---------- ---------- ---------- ---------- Columbia Growth Fund 0.750% 0.625% 0.500% 0.500% Columbia International Stock Fund 1.000% 1.000% 0.950% 0.900% Columbia Mid Cap Growth Fund 1.000% 1.000% 0.750% 0.750% Columbia Daily Income Company 0.500% 0.500% 0.450% 0.400% Columbia had voluntarily agreed to waive a portion of its investment advisory fee for the Columbia International Stock Fund at an annual rate of 0.10% of the average daily net assets for the period September 1, 2004 through October 31, 2004. The annualized effective rate of this waiver is 0.03%. For the six months ended February 28, 2005, the annualized effective investment advisory fee rates for the Columbia Growth Fund, Columbia International Stock Fund, Columbia Mid Cap Growth Fund, Columbia Small Cap Growth Fund, Columbia Technology Fund, Columbia Short Term Bond Fund, Columbia High Yield Fund and Columbia Daily Income Company were 0.61%, 0.87%, 0.82%, 0.93%, 0.91%, 0.47%, 0.56% and 0.49%, respectively. PRICING AND BOOKKEEPING FEES Columbia is responsible for providing pricing and bookkeeping services to the Funds under a pricing, bookkeeping and fund administration agreement. Under a separate agreement (the "Outsourcing Agreement"), Columbia has delegated certain of those functions to State Street Corporation ("State Street"). As a result, Columbia pays the total fees collected to State Street under the Outsourcing Agreement. 170 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Funds Under its pricing, bookkeeping and fund administration agreement with the Funds, Columbia receives from each Fund an annual flat financial accounting fee of $25,000, an annual flat financial reporting fee of $19,965 and a monthly financial accounting fee at the annual rate of 0.02% of the average daily net assets of each Fund. The combined financial accounting and financial reporting fee for a Fund in any year will not exceed $150,000. The Funds also pay additional fees for pricing services based on the number of securities held by each Fund. For the six months ended February 28, 2005, the annualized effective pricing and bookkeeping fee rates for the Funds, inclusive of out-of-pocket expenses, were as follows: Columbia Common Stock Fund 0.044% Columbia Growth Fund 0.020% Columbia International Stock Fund 0.026% Columbia Mid Cap Growth Fund 0.018% Columbia Small Cap Growth Fund 0.035% Columbia Real Estate Equity Fund 0.017% Columbia Technology Fund 0.151% Columbia Strategic Investor Fund 0.032% Columbia Balanced Fund 0.042% Columbia Short Term Bond Fund 0.037% Columbia Fixed Income Securities Fund 0.046% Columbia National Municipal Bond Fund 0.482% Columbia Oregon Municipal Bond Fund 0.040% Columbia High Yield Fund 0.010% Columbia Daily Income Company 0.026% TRANSFER AGENT FEE Columbia Funds Services, Inc. (the "Transfer Agent"), an affiliate of Columbia, provides shareholder services to the Funds and has subcontracted with Boston Financial Data Services ("BFDS") to serve as sub-transfer agent. For such services, the Transfer Agent receives a fee per open account, in addition to reimbursement for certain out-of-pocket expenses. The Funds' annual charges per open account for the transfer agent fees and annualized transfer agent fee rates, inclusive of out of pocket expenses, for the six months ended February 28, 2005 are as follows: PER OPEN ACCOUNT ANNUALIZED FEE RATE FEE RATE ---------- ---------- Columbia Common Stock Fund $ 28.00 0.24% Columbia Growth Fund $ 28.00 0.19% Columbia International Stock Fund $ 28.00 0.12% Columbia Mid Cap Growth Fund $ 28.00 0.17% Columbia Small Cap Growth Fund $ 28.00 0.16% Columbia Real Estate Equity Fund $ 28.00 0.12% Columbia Technology Fund $ 28.00 0.40% Columbia Strategic Investor Fund $ 28.00 0.15% Columbia Balanced Fund $ 28.00 0.18% Columbia Short Term Bond Fund $ 34.00 0.09% Columbia Fixed Income Securities Fund $ 34.00 0.22% Columbia National Municipal Bond Fund $ 34.00 0.13% Columbia Oregon Municipal Bond Fund $ 34.00 0.06% Columbia High Yield Fund $ 34.00 0.10% Columbia Daily Income Company $ 33.50 0.23% Columbia has voluntarily agreed to waive a portion of the transfer agent fees for the Columbia International Stock Fund, Columbia Mid Cap Growth Fund and Columbia Strategic Investor Fund. For the six months ended February 28, 2005, the annualized effective fee rates after waivers for Columbia International Stock Fund, Columbia Mid Cap Growth Fund and Columbia Strategic Investor Fund were 0.02%, 0.12% and 0.12%, respectively. 171 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Funds UNDERWRITING DISCOUNTS, SERVICE AND DISTRIBUTION FEES Columbia Funds Distributor, Inc. (the "Distributor"), an affiliate of Columbia, is the principal underwriter of the Funds. For the six months ended February 28, 2005, the Distributor has retained net underwriting discounts and CDSC fees as follows:
FRONT-END SALES CHARGE CONTINGENT DEFERRED SALES CHARGE (CDSC) ----------------- ------------------------------------------------------------- CLASS A CLASS T CLASS A CLASS B CLASS C CLASS D CLASS G CLASS T ------- ------- -------- -------- ------- ------- -------- -------- Columbia Common Stock Fund .................. $ 374 $ -- $ -- $ 1,236 $ 32 $ -- $ -- $ -- Columbia Growth Fund ............... 374 -- -- 4,261 147 -- 9,222 -- Columbia International Stock Fund ........... 2,076 -- -- 12,410 760 42 -- -- Columbia Mid Cap Growth Fund ................ 3,233 123 -- 7,839 773 -- 1,030 -- Columbia Real Estate Equity Fund ............ 15,996 -- 1,889 18,338 491 353 -- -- Columbia Technology Fund ........... 4,963 -- -- 13,985 215 -- -- -- Columbia Strategic Investor Fund ............ 70,610 -- -- 37,521 3,229 1 -- -- Columbia Balanced Fund ............. 1,501 -- -- 10,129 68 1 -- -- Columbia Short Term Bond Fund ............... 2,834 -- 4,389 67,068 -- 283 2,608 -- Columbia Fixed Income Securities Fund .................... 337 -- -- 8,043 199 158 -- -- Columbia National Municipal Bond Fund ................ 445 -- -- 92 100 -- -- -- Columbia Oregon Municipal Bond Fund ................ 1,347 -- -- 1,531 222 -- -- -- Columbia High Yield Fund ........... 20,292 -- 207 139,158 2,715 833 -- --
172 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Funds The Funds have adopted a 12b-1 plan (the "Plan") which requires the payment of a monthly service and distribution fee to the Distributor based on the average daily net assets of each Fund at the following annual rates:
DISTRIBUTION FEE ---------------------------------------------------- CLASS A(A) CLASS B CLASS C CLASS D CLASS G ---------- -------- -------- -------- -------- Columbia Common Stock Fund .................. 0.10% 0.75% 0.75% 0.75% -- Columbia Growth Fund ........................ 0.10% 0.75% 0.75% 0.75% 0.65%(b) Columbia International Stock Fund ........... -- 0.75% 0.75% 0.75% -- Columbia Mid Cap Growth Fund ................ 0.10% 0.75% 0.75% 0.75% 0.65%(b) Columbia Real Estate Equity Fund ............ 0.10% 0.75% 0.75% 0.75% -- Columbia Technology Fund .................... 0.10% 0.75% 0.75% 0.75% -- Columbia Strategic Investor Fund ............ -- 0.75% 0.75% 0.75% -- Columbia Balanced Fund ...................... 0.10% 0.75% 0.75% 0.75% -- Columbia Short Term Bond Fund ............... 0.10% 0.75% 0.75% 0.75% 0.65%(c) Columbia Fixed Income Securities Fund ....... 0.10% 0.75% 0.75% 0.75% -- Columbia National Municipal Bond Fund ....... 0.10% 0.75% 0.75% 0.75% -- Columbia Oregon Municipal Bond Fund ......... 0.10% 0.75% 0.75% 0.75% -- Columbia High Yield Fund .................... 0.10% 0.75% 0.75% 0.75% --
SERVICE FEE -------------------------------------------------------- CLASS A(A) CLASS B CLASS C CLASS D CLASS G ---------- -------- -------- -------- -------- Columbia Common Stock Fund .................. 0.25% 0.25% 0.25% 0.25% -- Columbia Growth Fund ........................ 0.25% 0.25% 0.25% 0.25% 0.50%(b) Columbia International Stock Fund ........... 0.25% 0.25% 0.25% 0.25% -- Columbia Mid Cap Growth Fund ................ 0.25% 0.25% 0.25% 0.25% 0.50%(b) Columbia Real Estate Equity Fund ............ 0.25% 0.25% 0.25% 0.25% -- Columbia Technology Fund .................... 0.25% 0.25% 0.25% 0.25% -- Columbia Strategic Investor Fund ............ 0.25% 0.25% 0.25% 0.25% -- Columbia Balanced Fund ...................... 0.25% 0.25% 0.25% 0.25% -- Columbia Short Term Bond Fund ............... 0.25% 0.25% 0.25% 0.25% 0.50%(c) Columbia Fixed Income Securities Fund ....... 0.25% 0.25% 0.25% 0.25% -- Columbia National Municipal Bond Fund ....... 0.25% 0.25% 0.25% 0.25% -- Columbia Oregon Municipal Bond Fund ......... 0.25% 0.25% 0.25% 0.25% -- Columbia High Yield Fund .................... 0.25% 0.25% 0.25% 0.25% --
(a) The Fund's Board of Trustees currently limits payments under the Plan for Class A shares to 0.25% annually of the Class A average daily net assets. (b) The Distributor has contractually agreed to limit a portion of the Class G distribution and service fees so that combined the fee does exceed 0.95% annually of the Class G shares average daily net assets. Of the 0.50% service fee, 0.25% relates to shareholder liaison fees and 0.25% relates to administrative support fees. (c) The Distributor has contractually agreed to limit a portion of the Class G distribution and service fees so that combined the fee does exceed 0.80% annually of the Class G shares average daily net assets. Of the 0.50% service fee, 0.25% relates to shareholder liaison fees and 0.25% relates to administrative support fees. 173 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Funds The Distributor has voluntarily agreed to waive a portion of the Class C and Class D distribution and service fees so that combined these fees do not exceed the annual rates on the average daily net assets of Class C and Class D shares of each Fund as follows: Columbia Short Term Bond Fund ......................... 0.40% Columbia Fixed Income Securities Fund ................. 0.85% Columbia National Municipal Bond Fund ................. 0.65% Columbia Oregon Municipal Bond Fund ................... 0.65% Columbia High Yield Fund .............................. 0.85% The CDSC and the fees received from the Plan are used principally as repayment to the Distributor for amounts paid by the Distributor to dealers who sold such shares. SHAREHOLDER SERVICES FEES The Columbia Mid Cap Growth Fund and Columbia Short Term Bond Fund have adopted shareholder services plans that permit them to pay for certain services provided to Class T shareholders by their financial advisors. The annual service fee may equal up to 0.50% annually for Class T shares, but will not exceed each Fund's net investment income attributable to Class T shares. The Columbia Mid Cap Growth Fund and Columbia Short Term Bond Fund do not intend to pay more than 0.30% and 0.15%, respectively, for annual Class T shareholder services fees. EXPENSE LIMITS AND FEE REIMBURSEMENTS Columbia has voluntarily agreed to waive fees and reimburse the Funds for certain expenses so that total expenses (exclusive of service fees, distribution fees, brokerage commissions, interest, taxes and extraordinary expenses, if any) would not exceed certain expense limitations. These arrangements may be revised or discontinued at any time. Total expenses are limited to the following annual percentages based on each Fund's average daily net assets: Columbia Technology Fund 1.65% Columbia Short Term Bond Fund 0.66% Columbia National Municipal Bond Fund 0.65% CUSTODY CREDITS Each Fund has an agreement with its custodian bank under which custody fees may be reduced by balance credits. The Funds could have invested a portion of the assets utilized in connection with the expense offset arrangement in an income-producing asset if they had not entered into such an agreement. FEES PAID TO OFFICERS AND TRUSTEES With the exception of one officer, all officers of the Funds are employees of Columbia or its affiliates and receive no compensation from the Funds. The Board of Trustees has appointed a Chief Compliance Officer to the Funds in accordance with federal securities regulations. Each Fund, along with other affiliated funds, will pay its pro-rata share of the expenses associated with the Office of the Chief Compliance Officer. Each Fund's fee for the Office of the Chief Compliance Officer will not exceed $15,000 per year. The Funds' Trustees may participate in a deferred compensation plan which may be terminated at any time. Obligations of the plan will be paid solely out of the Funds' assets. OTHER Columbia provides certain services to the Funds related to Sarbanes-Oxley compliance. This amount is included in "Other expenses" on the Statements of Operations. For the six months ended February 28, 2005, the Funds paid fees to Columbia for such services as follows: Columbia Common Stock Fund ........................... $ 894 Columbia Growth Fund ................................. 1,151 Columbia International Stock Fund .................... 1,095 Columbia Mid Cap Growth Fund ......................... 1,196 Columbia Small Cap Growth Fund ....................... 907 Columbia Real Estate Equity Fund ..................... 1,247 Columbia Technology Fund ............................. 774 Columbia Strategic Investor Fund ..................... 994 Columbia Balanced Fund ............................... 967 Columbia Short Term Bond Fund ........................ 1,007 Columbia Fixed Income Securities Fund ................ 902 Columbia National Municipal Bond Fund ................ 757 Columbia Oregon Municipal Bond Fund .................. 964 Columbia High Yield Fund ............................. 1,643 Columbia Daily Income Company ........................ 1,037 174 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Funds NOTE 5. PORTFOLIO INFORMATION For the six months ended February 28, 2005, the cost of purchases and proceeds from sales of securities, excluding short-term obligations, were as follows:
U.S. GOVERNMENT OTHER INVESTMENT SECURITIES SECURITIES ----------------------------- ------------------------------- PURCHASES SALES PURCHASES SALES ------------ ------------- -------------- ------------- Columbia Common Stock Fund .................. $ -- $ -- $ 95,332,792 $ 201,885,721 Columbia Growth Fund ........................ -- -- 388,331,194 553,044,704 Columbia International Stock Fund ........... -- -- 239,287,114 244,778,059 Columbia Mid Cap Growth Fund ................ -- -- 341,242,109 498,963,643 Columbia Small Cap Growth Fund .............. -- -- 266,181,247 618,105,218 Columbia Real Estate Equity Fund ............ -- -- 40,144,063 148,679,718 Columbia Technology Fund .................... -- -- 75,742,831 73,254,668 Columbia Strategic Investor Fund ............ -- -- 141,216,438 135,725,726 Columbia Balanced Fund ...................... 18,418,912 24,889,475 101,348,618 228,135,228 Columbia Short Term Bond Fund ............... 50,232,473 13,284,901 34,309,989 74,544,864 Columbia Fixed Income Securities Fund ....... 35,294,086 46,510,020 8,209,676 50,386,186 Columbia National Municipal Bond Fund ....... -- -- 1,351,513 5,018,627 Columbia Oregon Municipal Bond Fund ......... -- -- 11,461,501 20,978,462 Columbia High Yield Fund .................... -- -- 380,356,426 356,297,273
For the six months ended February 28, 2005, Columbia Technology Fund had transactions in written options as follows: NUMBER OF PREMIUM CONTRACTS RECEIVED --------- --------- Options Outstanding at August 31, 2004 -- $ -- Options Written - Call 200 62,399 Options Written - Put -- -- Options Closed (200) (62,399) Options Expired -- -- --------- --------- Options Outstanding at February 28, 2005 -- $ -- NOTE 6. OTHER RELATED PARTY TRANSACTIONS During the six months ended February 28, 2005, the Columbia Technology Fund used Bank of America Securities, a wholly owned subsidiary of BOA, as a broker. Total commissions paid to Bank of America Securities during the period were $125. NOTE 7. REDEMPTION FEES The Columbia International Stock Fund imposes a 2.00% redemption fee to shareholders of Class Z shares who redeem shares held for 60 days or less. Effective January 3, 2005, the Columbia International Stock Fund also began imposing a 2.00% redemption fee to shareholders of Class A, Class B, Class C and Class D shares who redeem shares held for 60 days or less. Redemption fees, which are retained by the Fund, are accounted for as an addition to paid-in capital and are allocated to each class proportionately for purposes of determining the net asset value of each class. For the six months ended February 28, 2005, the redemption fees for the Class A, Class B, Class C, Class D and Class Z shares of the Columbia International Stock Fund amounted to $1,935, $810, $53, $58 and $45,605, respectively. NOTE 8. LINE OF CREDIT The Funds and other affiliated funds participate in a $350,000,000 committed unsecured revolving line of credit provided by State Street Bank and Trust Company. Borrowings are used for temporary or 175 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Funds emergency purposes to facilitate portfolio liquidity. Interest is charged to each participating fund based on its borrowings at a rate per annum equal to the Federal Funds rate plus 0.50%. In addition, a commitment fee of 0.10% per annum is accrued and apportioned among the participating funds based on their pro-rata portion of the unutilized line of credit. The commitment fee is included in "Other expenses" on the Statements of Operations. For the six months ended February 28, 2005, the average daily loan balance outstanding on days where borrowings existed for the Columbia Mid Cap Growth Fund was $34,000,000 at a weighted average interest rate of 2.72%. For the six months ended February 28, 2005, the average daily loan balance outstanding on days where borrowings existed for the Columbia Small Cap Growth Fund was $19,250,000 at a weighted average interest rate of 2.52%. For the six months ended February 28, 2005, the Funds, other than the Columbia Mid Cap Growth Fund and Columbia Small Cap Growth Fund, did not borrow under this arrangement. NOTE 9. SHARES OF BENEFICIAL INTEREST As of February 28, 2005, the Funds had shareholders whose shares were beneficially owned by participant accounts over which BOA and/or its affiliates had either sole or joint investment discretion. Subscription and redemption activity in these accounts may have a significant effect on the operations of the Funds. The numbers of such accounts and the percentage of shares of beneficial interest outstanding held therein are as follows: % OF SHARES NUMBER OF OUTSTANDING SHAREHOLDERS HELD ------------ ----------- Columbia Growth Fund ................... 1 9.8% Columbia International Stock Fund ...... 2 66.0% Columbia Mid Cap Growth Fund ........... 2 17.4% Columbia Real Estate Equity Fund ....... 2 21.4% Columbia Short Term Bond Fund .......... 3 65.9% Columbia National Municipal Bond Fund .................. 1 13.4% Columbia High Yield Fund ............... 2 33.1% NOTE 10. DISCLOSURE OF SIGNIFICANT RISKS AND CONTINGENCIES CONCENTRATION OF CREDIT RISK Columbia National Municipal Bond Fund and Columbia Oregon Municipal Bond Fund hold investments that are insured by private insurers who guarantee the payment of principal and interest in the event of default or that are supported by a letter of credit. Each of the Funds' insurers are rated AAA by Moody's Investors Services, Inc., except for Radian Asset Assurance, Inc., which is rated AA by Standard & Poor's. At February 28, 2005, private insurers who insured greater than 5% of the total investments of the Funds were as follows: Columbia National Municipal Bond Fund % OF TOTAL INSURER INVESTMENTS ---------------------------------- ----------- Ambac Assurance Corp. 20.9% MBIA Insurance Corp. 17.2% Financial Guaranty Insurance Co. 15.9% Financial Security Assurance, Inc. 10.2% Columbia Oregon Municipal Bond Fund % OF TOTAL INSURER INVESTMENTS ---------------------------------- ----------- Financial Guaranty Insurance Co. 13.5% Financial Security Assurance, Inc. 11.7% MBIA Insurance Corp. 9.2% Ambac Assurance Corp. 6.9% FOREIGN SECURITIES There are certain additional risks involved when investing in foreign securities that are not inherent with investments in domestic securities. These risks may involve foreign currency exchange rate fluctuations, adverse political and economic developments and the possible prevention of currency exchange or other foreign governmental laws or restrictions. In addition, the liquidity of foreign securities may be more limited than that of domestic securities. Investments in emerging market countries are subject to additional risk. The risk of foreign investments is typically increased in less developed countries. These countries are also more likely to experience high levels of inflation, deflation or currency devaluation which could hurt their economies and securities markets. 176 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Funds GEOGRAPHIC CONCENTRATION The Columbia National Municipal Bond Fund has greater than 5% of its total investments at February 28, 2005, invested in debt obligations issued by the states of Illinois, Indiana, Mississippi, Tennessee, Texas and Washington. Also on this date, the Columbia Oregon Municipal Bond Fund has greater than 5% of its total investments invested in debt obligations issued by the state of Oregon. The Funds are also invested in each state's respective political subdivisions, agencies and public authorities to obtain funds for various purposes. These Funds are more susceptible to economic and political factors adversely affecting issuers of each respective state's specific municipal securities than are municipal bond funds that are not concentrated to the same extent in these issuers. HIGH-YIELD SECURITIES Investing in high-yield securities may involve greater credit risk and considerations not typically associated with investing in U.S. Government bonds and other higher quality fixed income securities. These securities are non-investment grade securities, often referred to as "junk bonds." Economic downturns may disrupt the high yield market and impair the ability of issuers to repay principal and interest. Also, an increase in interest rates would likely have an adverse impact on the value of such obligations. Moreover, high-yield securities may be less liquid to the extent that there is no established retail secondary market. INDUSTRY FOCUS The Funds may focus their investments in certain industries, subjecting them to greater risk than a fund that is more diversified. ISSUER FOCUS As non-diversified funds, the Columbia Real Estate Equity Fund, the Columbia Technology Fund and the Columbia Oregon Municipal Bond Fund may invest a greater percentage of its total assets in the securities of fewer issuers than a diversified fund. The Funds may, therefore, have a greater risk of loss from a few issuers than a similar fund that invests more broadly. LEGAL PROCEEDINGS On February 9, 2005, Columbia and Columbia Funds Distributor, Inc. (collectively the "Columbia Group") entered into an Assurance of Discontinuance with the New York Attorney General ("NYAG") (the "NYAG Settlement") and consented to the entry of a cease-and-desist order by the Securities and Exchange Commission ("SEC") (the "SEC Order"). The SEC Order and the NYAG Settlement are referred to collectively as the "Settlements". The Settlements contain substantially the same terms and conditions as outlined in the agreements in principle which Columbia Group entered into with the SEC and NYAG in March 2004. Under the terms of the SEC Order, the Columbia Group has agreed, among other things, to: pay $70 million in disgorgement and $70 million in civil money penalties; cease and desist from violations of the antifraud provisions and certain other provisions of the federal securities laws; maintain certain compliance and ethics oversight structures; retain an independent consultant to review the Columbia Group's applicable supervisory, compliance, control and other policies and procedures; and retain an independent distribution consultant (see below). The Columbia Funds have also voluntarily undertaken to implement certain governance measures designed to maintain the independence of their boards of trustees. The NYAG Settlement also, among other things, requires Columbia and its affiliates, Banc of America Capital Management, LLC and BACAP Distributors LLC to reduce certain Columbia Funds, Nations Funds and other mutual fund management fees collectively by $32 million per year for five years, for a projected total of $160 million in management fee reductions. Pursuant to the procedures set forth in the SEC Order, the $140 million in settlement amounts described above will be distributed in accordance with a distribution plan to be developed by an independent distribution consultant, who is acceptable to the SEC staff and the Columbia Funds' independent trustees. The distribution plan must be based on a methodology developed in consultation with the Columbia Group and the Funds' independent trustees and not unacceptable to the staff of the SEC. As a result of these matters or any adverse publicity or other developments resulting from them, there may be increased redemptions or reduced sales of fund shares, which could increase transaction costs or operating expenses, or have other adverse consequences for the funds. 177 ________________________________________________________________________________ February 28, 2005 (Unaudited) Columbia Funds A copy of the SEC Order is available on the SEC website at http://www.sec.gov. A copy of the NYAG Settlement is available as part of the Bank of America Corporation Form 8-K filing on February 10, 2005. In connection with the events described in detail above, various parties have filed suit against certain funds, their Boards and/or Bank of America (and affiliated entities). More than 300 cases (including those filed against entities unaffiliated with the funds, their Boards and/or FleetBoston and its affiliated entities) have been consolidated in a multi-district proceeding and transferred to the Federal District Court in Maryland. Recently, certain Columbia funds and affiliated entities have been named as defendants in several direct and derivative actions under various sections of the Investment Company Act of 1940, as amended, alleging, among other things, that the fees and expenses paid by those funds are excessive. On January 11, 2005 a putative class action lawsuit was filed in federal district court in Massachusetts against, among others, the Trustees of the Funds and Columbia. The lawsuit alleges that defendants violated common law duties to fund shareholders as well as sections of the Investment Company Act of 1940, by failing to ensure that the Fund and other affiliated funds participated in securities class action settlements for which the funds were eligible. Specifically, plaintiffs allege that defendants failed to submit proof of claims in connection with settlements of securities class action lawsuits filed against companies in which the funds held positions. On March 2, 2005, four civil revenue sharing actions alleging, among other things, that various mutual funds advised by Columbia Management and certain other affiliates inappropriately used fund assets to pay brokers to promote the funds by directing fund brokerage transactions to such brokers and did not fully disclose such arrangements to shareholders, and charged excessive 12b-1 fees, were consolidated into a single action in the United States District Court for Massachusetts (In re Columbia Entities Litigation, Civil Action No. 04-11704-REK). The consolidated complaint has not yet been filed. The funds and the other defendants to these actions, including Columbia and various of its affiliates, certain other mutual funds advised by Columbia and its affiliates, and various directors of such funds, have denied these allegations and are contesting the plaintiffs' claims. These proceedings are ongoing, however, based on currently available information, Columbia believes that these lawsuits are without merit, that the likelihood they will have a material adverse impact on any fund is remote, and that the lawsuits are not likely to materially affect its ability to provide investment management services to its clients, including the funds. For the six months ended February 28, 2005, Columbia has assumed legal, consulting services and Trustees' fees incurred by the Funds in connection with these matters as follows: Columbia Common Stock Fund ......................... $ 2,299 Columbia Growth Fund ............................... 6,719 Columbia International Stock Fund .................. 5,715 Columbia Mid Cap Growth Fund ....................... 7,512 Columbia Small Cap Growth Fund ..................... 2,733 Columbia Real Estate Equity Fund ................... 8,095 Columbia Technology Fund ........................... 372 Columbia Strategic Investor Fund ................... 4,100 Columbia Balanced Fund ............................. 3,583 Columbia Short Term Bond Fund ...................... 4,404 Columbia Fixed Income Securities Fund .............. 2,599 Columbia National Municipal Bond Fund .............. 114 Columbia Oregon Municipal Bond Fund ................ 3,707 Columbia High Yield Fund ........................... 15,281 NOTE 11. PROPOSED REORGANIZATION On February 10, 2005, the Board of Trustees approved a proposal to merge the Columbia Short Term Bond Fund into the Nations Short-Term Income Fund. The merger is subject to approval by the Nations Funds Board of Trustees as well as shareholder approval and the satisfaction of certain other conditions. The Columbia Short Term Bond Fund will be closed to new investments as of the close of business on April 29, 2005. The merger is expected to be completed in the third quarter of 2005. The Columbia National Municipal Bond Fund will be closed to new investments as of the close of business on April 29, 2005. On February 10, 2005, the Board of Trustees have approved its liquidation, which will take effect later this year, pending shareholder approval. NOTE 12. SUBSEQUENT EVENT As of the end of business on March 18, 2005, the Columbia Common Stock Fund and the Columbia Growth Fund were acquired by the Columbia Large Cap Core Fund and Columbia Large Cap Growth Fund, respectively, pursuant to a plan of reorganization approved by the Funds' shareholders. 178 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Common Stock Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS A SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 18.10 $ 17.22 $ 14.91 $ 15.09 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) (c) 0.09(d) 0.02 0.01 --(e) Net realized and unrealized gain (loss) on investments 1.69 0.89 2.30 (0.11) ------------ ------------ ------------ ------------ Total from investment operations 1.78 0.91 2.31 (0.11) ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.10) (0.03) -- (0.07) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 19.78 $ 18.10 $ 17.22 $ 14.91 Total return (f) 9.86%(g) 5.28% 15.49%(g) (0.71)%(g) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 802 $ 1,201 $ 223 $ 32 Ratio of expenses to average net assets (h) 1.22%(i) 1.17% 1.40%(i) 1.32%(i) Ratio of net investment income (loss) to average net assets (h) 0.98%(i) 0.13% 0.08%(i) (0.03)%(i) Portfolio turnover rate 35%(g) 192% 102%(g) 107% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class A shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Net investment income per share reflects a special dividend which amounted to $0.08 per share. (e) Rounds to less than $0.01 per share. (f) Total return at net asset value assuming all distributions reinvested and no initial sales charge or contingent deferred sales charge. (g) Not annualized. (h) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (i) Annualized.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS B SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 17.88 $ 17.12 $ 14.91 $ 15.09 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) (c) 0.01(d) (0.12) (0.09) (0.01) Net realized and unrealized gain (loss) on investments 1.69 0.88 2.30 (0.12) ------------ ------------ ------------ ------------ Total from investment operations 1.70 0.76 2.21 (0.13) ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income -- -- -- (0.05) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 19.58 $ 17.88 $ 17.12 $ 14.91 Total return (e) 9.51%(f) 4.44% 14.82%(f) (0.84)%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 2,102 $ 2,060 $ 620 $ 109 Ratio of expenses to average net assets (g) 1.97%(h) 1.92% 2.36%(h) 2.07%(h) Ratio of net investment income (loss) to average net assets (g) 0.14%(h) (0.67)% (0.90)%(h) (0.78)%(h) Portfolio turnover rate 35%(f) 192% 102%(f) 107% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class B shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Net investment income per share reflects a special dividend which amounted to $0.08 per share. (e) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. 179 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Common Stock Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, CLASS C SHARES 2005 2004 (a) ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 17.88 $ 17.61 ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss)(b) 0.02(c) (0.11) Net realized and unrealized gain on investments 1.68 0.38 ------------ ------------ Total from investment operations 1.70 0.27 ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 19.58 $ 17.88 Total return (d)(e) 9.51% 1.53% ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 50 $ 26 Ratio of expenses to average net assets (f)(g) 1.97% 1.95% Ratio of net investment income (loss) to average net assets (f)(g) 0.22% (0.65)% Portfolio turnover rate 35%(e) 192% ------------ ------------
(a) Class C shares were initially offered on October 13, 2003. Per share data and total return reflect activity from that date. (b) Per share data was calculated using average shares outstanding during the period. (c) Net investment income per share reflects a special dividend which amounted to $0.08 per share. (d) Total return at net asset value assuming no contingent deferred sales charge. (e) Not annualized. (f) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (g) Annualized.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS D SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 17.88 $ 17.11 $ 14.92 $ 15.09 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) (c) 0.01(d) (0.11) (0.12) (0.01) Net realized and unrealized gain (loss) on investments 1.68 0.88 2.31 (0.11) ------------ ------------ ------------ ------------ Total from investment operations 1.69 0.77 2.19 (0.12) ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income -- -- -- (0.05) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 19.57 $ 17.88 $ 17.11 $ 14.92 Total return (e) 9.45%(f) 4.50% 14.68%(f) (0.77)%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 123 $ 129 $ 112 $ 30 Ratio of expenses to average net assets (g) 1.97%(h) 1.92% 2.61%(h) 2.07%(h) Ratio of net investment income (loss) to average net assets (g) 0.09%(h) (0.59)% (1.09)%(h) (0.78)%(h) Portfolio turnover rate 35%(f) 192% 102%(f) 107% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class D shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Net investment income per share reflects a special dividend which amounted to $0.08 per share. (e) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. 180 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Common Stock Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, CLASS Z SHARES 2005 2004 2003 (a) ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 18.12 $ 17.26 $ 14.91 ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) 0.11(c)(d) 0.08(c) 0.06(c) Net realized and unrealized gain (loss) on investments 1.70 0.88 2.29 ------------ ------------ ------------ Total from investment operations 1.81 0.96 2.35 ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.15) (0.10) -- From net realized gains -- -- -- ------------ ------------ ------------ Total distributions (0.15) (0.10) -- ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 19.78 $ 18.12 $ 17.26 Total return (e) 9.99%(f) 5.58% 15.76%(f) ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 224,972 $ 303,259 $ 427,669 Ratio of expenses to average net assets (g) 0.97%(h) 0.92% 0.94%(h) Ratio of net investment income (loss) to average net assets (g) 1.15%(h) 0.41% 0.55%(h) Portfolio turnover rate 35%(f) 192% 102%(f) ------------ ------------ ------------
YEAR ENDED DECEMBER 31, ------------------------------------------------------------------------ CLASS Z SHARES 2002 (b) 2001 2000 1999 ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 19.97 $ 24.34 $ 28.90 $ 24.40 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) 0.07(c) 0.07 (0.01) 0.03 Net realized and unrealized gain (loss) on investments (5.05) (4.35) (1.54) 6.25 ------------ ------------ ------------ ------------ Total from investment operations (4.98) (4.28) (1.55) 6.28 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.08) (0.07) -- (0.03) From net realized gains -- (0.02) (3.01) (1.75) ------------ ------------ ------------ ------------ Total distributions (0.08) (0.09) (3.01) (1.78) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 14.91 $ 19.97 $ 24.34 $ 28.90 Total return (e) (24.92)% (17.60)% (5.73)% 25.76% ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 416,638 $ 681,397 $ 895,134 $ 959,910 Ratio of expenses to average net assets (g) 0.86% 0.80% 0.75% 0.77% Ratio of net investment income (loss) to average net assets (g) 0.43% 0.32% (0.05)% 0.09% Portfolio turnover rate 107% 114% 104% 97% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) On November 1, 2002, the existing Fund shares were renamed Class Z shares. (c) Per share data was calculated using average shares outstanding during the period. (d) Net investment income per share reflects a special dividend which amounted to $0.08 per share. (e) Total return at net asset value assuming all distributions reinvested. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. 181 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Growth Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS A SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 24.93 $ 24.61 $ 20.83 $ 21.52 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) (c) 0.10(d) (0.07) (0.07) --(e) Net realized and unrealized gain (loss) on investments 2.82 0.39 3.85 (0.69) ------------ ------------ ------------ ------------ Total from investment operations 2.92 0.32 3.78 (0.69) ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.09) -- -- -- ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 27.76 $ 24.93 $ 24.61 $ 20.83 Total return (f) 11.73%(g) 1.30% 18.15%(g) (3.21)%(g) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 4,851 $ 4,668 $ 4,229 $ 3,077 Ratio of expenses to average net assets (h) 1.11%(i) 1.12% 1.33%(i) 1.15%(i) Ratio of net investment income (loss) to average net assets (h) 0.76%(i) (0.28)% (0.44)%(i) (0.36)%(i) Portfolio turnover rate 50%(g) 130% 110%(g) 165% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class A shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Net investment income per share reflects a special dividend which amounted to $0.12 per share. (e) Rounds to less than $0.01 per share. (f) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (g) Not annualized. (h) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (i) Annualized.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS B SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 24.60 $ 24.47 $ 20.82 $ 21.52 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) (c) --(d)(e (0.27) (0.19) (0.03) Net realized and unrealized gain (loss) on investments 2.79 0.40 3.84 (0.67) ------------ ------------ ------------ ------------ Total from investment operations 2.79 0.13 3.65 (0.70) ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.03) -- -- -- ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 27.36 $ 24.60 $ 24.47 $ 20.82 Total return (f) 11.33%(g) 0.53% 17.53%(g) (3.25)%(g) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 2,387 $ 2,254 $ 793 $ 114 Ratio of expenses to average net assets (h) 1.86%(i) 1.87% 2.11%(i) 1.88%(i) Ratio of net investment income (loss) to average net assets (h) --%(i)(j) (1.04)% (1.27)%(i) (1.09)%(i) Portfolio turnover rate 50%(g) 130% 110%(g) 165% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class B shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Net investment income per share reflects a special dividend which amounted to $0.12 per share. (e) Rounds to less than $0.01 per share. (f) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (g) Not annualized. (h) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (i) Annualized. (j) Rounds to less than 0.01%. 182 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Growth Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, CLASS C SHARES 2005 2004 (a) ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 24.54 $ 24.96 ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) (b) --(c)(d) (0.23) Net realized and unrealized gain (loss) on investments 2.78 (0.19) ------------ ------------ Total from investment operations 2.78 (0.42) ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.03) -- ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 27.29 $ 24.54 Total return (e)(f) 11.32% (1.68)% ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 294 $ 199 Ratio of expenses to average net assets (g)(h) 1.86% 1.90% Ratio of net investment income (loss) to average net assets (g)(h) 0.03% (1.01)% Portfolio turnover rate 50%(f) 130% ------------ ------------
(a) Class C shares were initially offered on October 13, 2003. Per share data and total return reflect activity from that date. (b) Per share data was calculated using average shares outstanding during the period. (c) Net investment income per share reflects a special dividend which amounted to $0.12 per share. (d) Rounds to less than $0.01 per share. (e) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS D SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 24.62 $ 24.48 $ 20.82 $ 21.52 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment loss (c) (0.02)(d) (0.27) (0.17) (0.02) Net realized and unrealized gain (loss) on investments 2.81 0.41 3.83 (0.68) ------------ ------------ ------------ ------------ Total from investment operations 2.79 0.14 3.66 (0.70) ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.03) -- -- -- ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 27.38 $ 24.62 $ 24.48 $ 20.82 Total return (e) 11.32%(f) 0.57% 17.58%(f) (3.25)%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 119 $ 167 $ 294 $ 103 Ratio of expenses to average net assets (g) 1.86%(h) 1.87% 2.02%(h) 1.88%(h) Ratio of net investment loss to average net assets (g) (0.14)%(h) (1.04)% (1.15)%(h) (1.09)%(h) Portfolio turnover rate 50%(f) 130% 110%(f) 165% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class D shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Net investment loss per share reflects a special dividend which amounted to $0.12 per share. (e) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. 183 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Growth Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS G SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 24.64 $ 24.49 $ 20.83 $ 21.52 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment loss (c) (0.01)(d) (0.25) (0.16) (0.03) Net realized and unrealized gain (loss) on investments 2.80 0.40 3.82 (0.66) ------------ ------------ ------------ ------------ Total from investment operations 2.79 0.15 3.66 (0.69) ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.03) -- -- -- ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 27.40 $ 24.64 $ 24.49 $ 20.83 Total return (e) 11.33%(f) 0.61% 17.57%(f) (3.21)%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 13,331 $ 12,996 $ 14,810 $ 13,705 Ratio of expenses to average net assets (g) 1.81%(h) 1.82% 2.00%(h) 1.83%(h) Ratio of net investment income (loss) to average net assets (g) 0.04%(h) (0.98)% (1.10)%(h) (1.04)%(h) Portfolio turnover rate 50%(f) 130% 110%(f) 165% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class G shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Net investment loss per share reflects a special dividend which amounted to $0.12 per share. (e) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, CLASS Z SHARES 2005 2004 2003 (a) ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 25.09 $ 24.70 $ 20.85 ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) 0.13(c)(d) --(c)(e) --(c)(e) Net realized and unrealized gain (loss) on investments 2.85 0.39 3.85 ------------ ------------ ------------ Total from investment operations 2.98 0.39 3.85 ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.12) -- -- From net realized gains -- -- -- ------------ ------------ ------------ Total distributions (0.12) -- -- ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 27.95 $ 25.09 $ 24.70 Total return (f) 11.86%(g) 1.58% 18.47%(g) ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 716,652 $ 790,696 $ 909,611 Ratio of expenses to average net assets (h) 0.86%(i) 0.87% 0.88%(i) Ratio of net investment income (loss) to average net assets (h) 0.99%(i) (0.01)% 0.01%(i) Portfolio turnover rate 50%(g) 130% 110%(g) ------------ ------------ ------------
YEAR ENDED DECEMBER 31, ------------------------------------------------------------------------ CLASS Z SHARES 2002 (b) 2001 2000 1999 ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 31.35 $ 40.07 $ 48.91 $ 42.51 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) (0.01)(c) (0.02) (0.08) (0.03) Net realized and unrealized gain (loss) on investments (10.49) (8.55) (3.49) 11.09 ------------ ------------ ------------ ------------ Total from investment operations (10.50) (8.57) (3.57) 11.06 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income -- -- -- --(e) From net realized gains -- (0.15) (5.27) (4.66) ------------ ------------ ------------ ------------ Total distributions -- (0.15) (5.27) (4.66) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 20.85 $ 31.35 $ 40.07 $ 48.91 Total return (f) (33.49)% (21.40)% (7.94)% 26.02% ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 811,648 $ 1,325,844 $ 1,919,227 $ 2,160,739 Ratio of expenses to average net assets (h) 0.82% 0.72% 0.65% 0.65% Ratio of net investment income (loss) to average net assets (h) (0.03)% (0.07)% (0.18)% (0.07)% Portfolio turnover rate 165% 122% 114% 118% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) On November 1, 2002, the existing Fund shares were renamed Class Z shares. (c) Per share data was calculated using average shares outstanding during the period. (d) Net investment income per share reflects a special dividend which amounted to $0.12 per share. (e) Rounds to less than $0.01 per share. (f) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (g) Not annualized. (h) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (i) Annualized. 184 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia International Stock Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS A SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 13.04 $ 11.34 $ 10.05 $ 10.04 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) (c) --(d) 0.01 0.04 (0.02) Net realized and unrealized gain on investments, foreign currency and foreign capital gains tax 2.28 1.69 1.25 0.03 ------------ ------------ ------------ ------------ Total from investment operations 2.28 1.70 1.29 0.01 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income --(d) -- -- -- ------------ ------------ ------------ ------------ REDEMPTION FEES: Redemption fees added to paid-in-capital --(c)(d) --(c)(d) -- -- ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 15.32 $ 13.04 $ 11.34 $ 10.05 Total return (e) 17.51%(f)(g) 14.99%(f) 12.84%(g) 0.10%(g) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 27,675 $ 24,119 $ 21,664 $ 20,178 Ratio of expenses to average net assets (h) 1.28%(i) 1.72% 1.90%(i) 1.86%(i) Ratio of net investment income (loss) to average net assets (h) 0.05%(i) 0.10% 0.61%(i) (0.39)% (i) Waiver 0.13%(i) 0.09% -- -- Portfolio turnover rate 38%(g) 90% 43%(g) 96% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class A shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Rounds to less than $0.01 per share. (e) Total return at net asset value assuming no initial sales charge or contingent deferred sales charge. (f) Had the Investment Advisor not waived a portion of expenses, total return would have been reduced. (g) Not annualized. (h) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (i) Annualized.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS B SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 12.81 $ 11.23 $ 10.02 $ 10.04 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment loss (c) (0.05) (0.09) (0.03) (0.05) Net realized and unrealized gain on investments, foreign currency and foreign capital gains tax 2.24 1.67 1.24 0.03 ------------ ------------ ------------ ------------ Total from investment operations 2.19 1.58 1.21 (0.02) ------------ ------------ ------------ ------------ REDEMPTION FEES: Redemption fees added to paid-in-capital --(c)(d) --(c)(d) -- -- ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 15.00 $ 12.81 $ 11.23 $ 10.02 Total return (e)(f) 17.10%(g) 14.07% 12.08%(g) (0.20)%(g) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 11,317 $ 10,221 $ 10,316 $ 10,920 Ratio of expenses to average net assets (h) 2.03%(i) 2.50% 2.98%(i) 3.64%(i) Ratio of net investment loss to average net assets (h) (0.70)%(i) (0.69)% (0.47)%(i) (2.17)%(i) Waiver 0.13%(i) 0.18% 0.11%(i) 0.11%(i) Portfolio turnover rate 38%(g) 90% 43%(g) 96% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class B shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Rounds to less than $0.01 per share. (e) Total return at net asset value assuming no contingent deferred sales charge. (f) Had the Investment Advisor not waived a portion of expenses, total return would have been reduced. (g) Not annualized. (h) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (i) Annualized. 185 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia International Stock Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, CLASS C SHARES 2005 2004 (a) ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 12.86 $ 12.27 ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment loss (b) (0.05) (0.01) Net realized and unrealized gain on investments, foreign currency and foreign capital gains tax 2.24 0.60 ------------ ------------ Total from investment operations 2.19 0.59 ------------ ------------ REDEMPTION FEES: Redemption fees added to paid-in-capital (b)(c) -- -- ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 15.05 $ 12.86 Total return (d)(e)(f) 17.03% 4.81% ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 622 $ 632 Ratio of expenses to average net assets (g)(h) 2.03% 2.11% Ratio of net investment loss to average net assets (g)(h) (0.70)% (0.05)% Waiver (h) 0.13% 0.35% Portfolio turnover rate 38%(f) 90% ------------ ------------
(a) Class C shares were initially offered on October 13, 2003. Per share data and total return reflect activity from that date. (b) Per share data was calculated using average shares outstanding during the period. (c) Rounds to less than $0.01 per share. (d) Total return at net asset value assuming no contingent deferred sales charge. (e) Had the Investment Advisor not waived a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS D SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 12.91 $ 11.27 $ 10.02 $ 10.04 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) (c) (0.05) (0.04) --(d) (0.04) Net realized and unrealized gain on investments, foreign currency and foreign capital gains tax 2.25 1.68 1.25 0.02 ------------ ------------ ------------ ------------ Total from investment operations 2.20 1.64 1.25 (0.02) ------------ ------------ ------------ ------------ REDEMPTION FEES: Redemption fees added to paid-in-capital --(c)(d) --(c)(d) -- -- ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 15.11 $ 12.91 $ 11.27 $ 10.02 Total return (e)(f) 17.04%(g) 14.55% 12.48%(g) (0.20)%(g) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 750 $ 738 $ 633 $ 542 Ratio of expenses to average net assets (h) 2.03%(i) 2.10% 2.49%(i) 3.48%(i) Ratio of net investment income (loss) to average net assets (h) (0.70)%(i) (0.27)% 0.02%(i) (2.01)%(i) Waiver 0.13%(i) 0.57% 0.75%(i) 0.75%(i) Portfolio turnover rate 38%(g) 90% 43%(g) 96% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class D shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Rounds to less than $0.01 per share. (e) Total return at net asset value assuming no contingent deferred sales charge. (f) Had the Investment Advisor not waived a portion of expenses, total return would have been reduced. (g) Not annualized. (h) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (i) Annualized. 186 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia International Stock Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, CLASS Z SHARES 2005 2004 2003 (a) ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 13.14 $ 11.40 $ 10.05 ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) 0.02(c) 0.11(c) 0.07(c) Net realized and unrealized gain (loss) on investments, foreign currency and foreign capital gains tax 2.29 1.67 1.27 ------------ ------------ ------------ Total from investment operations 2.31 1.78 1.34 ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.07) (0.04) -- From net realized gains -- -- -- Return of capital -- -- -- ------------ ------------ ------------ Total distributions (0.07) (0.04) -- ------------ ------------ ------------ REDEMPTION FEES: Redemption fees added to paid-in-capital --(c)(d) --(c)(d) 0.01(c) ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 15.38 $ 13.14 $ 11.40 Total return (e) 17.61%(f)(g) 15.65%(f) 13.43%(f)(g) ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 637,601 $ 558,082 $ 248,718 Ratio of expenses to average net assets (h) 1.03%(i) 1.10% 1.47%(i) Ratio of net investment income (loss) to average net assets (h) 0.30%(i) 0.81% 1.03%(i) Waiver 0.13%(i) 0.18% 0.12%(i) Portfolio turnover rate 38%(g) 90% 43%(g) ------------ ------------ ------------
YEAR ENDED DECEMBER 31, ------------------------------------------------------------------------ CLASS Z SHARES 2002 (b) 2001 2000 1999 ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 12.03 $ 14.77 $ 22.81 $ 15.45 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) --(c)(d) 0.01 (0.04) (0.05) Net realized and unrealized gain (loss) on investments, foreign currency and foreign capital gains tax (1.94) (2.74) (5.17) 9.00 ------------ ------------ ------------ ------------ Total from investment operations (1.94) (2.73) (5.21) 8.95 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.01) (0.01) -- -- From net realized gains -- -- (2.83) (1.59) Return of capital (0.03) -- -- -- ------------ ------------ ------------ ------------ Total distributions (0.04) (0.01) (2.83) (1.59) ------------ ------------ ------------ ------------ REDEMPTION FEES: Redemption fees added to paid-in-capital -- -- -- -- ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 10.05 $ 12.03 $ 14.77 $ 22.81 Total return (e) (16.10)%(f) (18.47)% (22.64)% 57.93% ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 143,332 $ 135,626 $ 175,316 $ 239,223 Ratio of expenses to average net assets (h) 1.49% 1.56% 1.42% 1.48% Ratio of net investment income (loss) to average net assets (h) (0.02)% 0.06% (0.19)% (0.35)% Waiver 0.12% -- -- Portfolio turnover rate 96% 130% 112% 94% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) On November 1, 2002, the existing Fund shares were renamed Class Z shares. (c) Per share data was calculated using average shares outstanding during the period. (d) Rounds to less than $0.01 per share. (e) Total return at net asset value assuming all distributions reinvested. (f) Had the Investment Advisor not waived a portion of expenses, total return would have been reduced. (g) Not annualized. (h) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (i) Annualized. 187 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Mid Cap Growth Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS A SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 16.99 $ 18.09 $ 14.77 $ 15.15 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment loss (c) (0.08) (0.23) (0.14) (0.02) Net realized and unrealized gain (loss) on investments and foreign currency 3.68 (0.87) 3.46 (0.36) ------------ ------------ ------------ ------------ Total from investment operations 3.60 (1.10) 3.32 (0.38) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 20.59 $ 16.99 $ 18.09 $ 14.77 Total return (d)(e) 21.19%(f) (6.08)% 22.48%(f) (2.51)%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 5,547 $ 4,432 $ 4,525 $ 1,180 Ratio of operating expenses to average net assets (g) 1.27%(h) 1.53% 1.60%(h) 1.49%(h) Ratio of interest expense to average net assets --%(h)(i) -- -- -- Ratio of total expenses to average net assets (g) 1.27%(h) 1.53% 1.60%(h) 1.49%(h) Ratio of net investment loss to average net assets (g) (0.87)%(h) (1.21)% (1.31)%(h) (1.22)%(h) Waiver 0.05%(h) 0.02% 0.01%(h) 0.01%(h) Portfolio turnover rate 39%(f) 139% 78%(f) 88% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class A shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming no initial sales charge or contingent deferred sales charge. (e) Had the Investment Advisor not waived a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. (i) Rounds to less than 0.01%.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS B SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 16.75 $ 17.98 $ 14.76 $ 15.15 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment loss (c) (0.15) (0.36) (0.22) (0.04) Net realized and unrealized gain (loss) on investments and foreign currency 3.63 (0.87) 3.44 (0.35) ------------ ------------ ------------ ------------ Total from investment operations 3.48 (1.23) 3.22 (0.39) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 20.23 $ 16.75 $ 17.98 $ 14.76 Total return (d)(e) 20.78%(f) (6.84)% 21.82%(f) (2.57)%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 5,913 $ 5,079 $ 4,242 $ 3,383 Ratio of operating expenses to average net assets (g) 2.02%(h) 2.29% 2.36%(h) 2.32%(h) Ratio of interest expense to average net assets --%(h)(i) -- -- -- Ratio of total expenses to average net assets (g) 2.02%(h) 2.29% 2.36%(h) 2.32%(h) Ratio of net investment loss to average net assets (g) (1.62)%(h) (1.97)% (2.06)%(h) (2.05)%(h) Waiver 0.05%(h) 0.10% 0.12%(h) 0.12%(h) Portfolio turnover rate 39%(f) 139% 78%(f) 88% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class B shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming no contingent deferred sales charge. (e) Had the Investment Advisor not waived a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. (i) Rounds to less than 0.01%. 188 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Mid Cap Growth Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, CLASS C SHARES 2005 2004 (a) ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 16.79 $ 17.88 ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment loss (b) (0.15) (0.30) Net realized and unrealized gain (loss) on investments and foreign currency 3.63 (0.79) ------------ ------------ Total from investment operations 3.48 (1.09) ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 20.27 $ 16.79 Total return (c)(d)(e) 20.73% (6.10)% ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 566 $ 501 Ratio of operating expenses to average net assets (f)(g) 2.02% 2.18% Ratio of interest expense to average net assets --%(g)(h) -- Ratio of total expenses to average net assets (f)(g) 2.02% 2.18% Ratio of net investment loss to average net assets (f)(g) (1.62)% (1.83)% Waiver (g) 0.05% 0.08% Portfolio turnover rate 39%(e) 139% ------------ ------------
(a) Class C shares were initially offered on October 13, 2003. Per share data and total return reflect activity from that date. (b) Per share data was calculated using average shares outstanding during the period. (c) Total return at net asset value assuming no contingent deferred sales charge. (d) Had the Investment Advisor not waived a portion of expenses, total return would have been reduced. (e) Not annualized. (f) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (g) Annualized. (h) Rounds to less than 0.01%.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS D SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 16.77 $ 17.98 $ 14.76 $ 15.15 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment loss (c) (0.15) (0.34) (0.21) (0.04) Net realized and unrealized gain (loss) on investments and foreign currency 3.63 (0.87) 3.43 (0.35) ------------ ------------ ------------ ------------ Total from investment operations 3.48 (1.21) 3.22 (0.39) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 20.25 $ 16.77 $ 17.98 $ 14.76 Total return (d)(e) 20.75%(f) (6.73)% 21.82%(f) (2.57)%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 539 $ 599 $ 737 $ 433 Ratio of operating expenses to average net assets (g) 2.02%(h) 2.19% 2.27%(h) 2.32%(h) Ratio of interest expense to average net assets --%(h)(i) -- -- -- Ratio of total expenses to average net assets (g) 2.02%(h) 2.19% 2.27%(h) 2.32%(h) Ratio of net investment loss to average net assets (g) (1.62)%(h) (1.87)% (1.97)%(h) (2.05)%(h) Waiver 0.05%(h) 0.08% 0.09%(h) 0.09%(h) Portfolio turnover rate 39%(f) 139% 78%(f) 88% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class D shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming no contingent deferred sales charge. (e) Had the Investment Advisor not waived a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. (i) Rounds to less than 0.01%. 189 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Mid Cap Growth Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS G SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 16.70 $ 17.98 $ 14.77 $ 15.15 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment loss (c) (0.15) (0.41) (0.23) (0.04) Net realized and unrealized gain (loss) on investments and foreign currency 3.62 (0.87) 3.44 (0.34) ------------ ------------ ------------ ------------ Total from investment operations 3.47 (1.28) 3.21 (0.38) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 20.17 $ 16.70 $ 17.98 $ 14.77 Total return (d) 20.78%(e)(f) (7.12)%(e) 21.73%(f) (2.51)%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 734 $ 647 $ 806 $ 753 Ratio of operating expenses to average net assets (g) 1.97%(h) 2.57% 2.47%(h) 2.35%(h) Ratio of interest expense to average net assets --%(h)(i) -- -- -- Ratio of total expenses to average net assets (g) 1.97%(h) 2.57% 2.47%(h) 2.35%(h) Ratio of net investment loss to average net assets (g) (1.57)%(h) (2.25)% (2.17)%(h) (2.08)%(h) Waiver 0.05%(h) 0.01% -- -- Portfolio turnover rate 39%(f) 139% 78%(f) 88% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class G shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming no contingent deferred sales charge. (e) Had the Investment Advisor not waived a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. (i) Rounds to less than 0.01%.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS T SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 17.03 $ 18.12 $ 14.79 $ 15.15 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment loss (c) (0.09) (0.22) (0.12) (0.02) Net realized and unrealized gain (loss) on investments and foreign currency 3.69 (0.87) 3.45 (0.34) ------------ ------------ ------------ ------------ Total from investment operations 3.60 (1.09) 3.33 (0.36) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 20.63 $ 17.03 $ 18.12 $ 14.79 Total return (d) 21.14%(e)(f) (6.02)%(e) 22.52%(f) (2.38)%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 28,307 $ 25,236 $ 29,920 $ 25,966 Ratio of operating expenses to average net assets (g) 1.32%(h) 1.50% 1.46%(h) 1.45%(h) Ratio of interest expense to average net assets --%(h)(i) -- -- -- Ratio of total expenses to average net assets (g) 1.32%(h) 1.50% 1.46%(h) 1.45%(h) Ratio of net investment loss to average net assets (g) (0.92)%(h) (1.19)% (1.16)%(h) (1.18)%(h) Waiver 0.05%(h) 0.01% -- -- Portfolio turnover rate 39%(f) 139% 78%(f) 88% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class T shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming no initial sales charge or contingent deferred sales charge. (e) Had the Investment Advisor not waived a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. (i) Rounds to less than 0.01%. 190 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Mid Cap Growth Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, CLASS Z SHARES 2005 2004 2003 (a) ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 17.14 $ 18.17 $ 14.79 ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment loss (0.06)(c) (0.14)(c) (0.08)(c) Net realized and unrealized gain (loss) on investments and foreign currency 3.72 (0.89) 3.46 ------------ ------------ ------------ Total from investment operations 3.66 (1.03) 3.38 ------------ ------------ ------------ LESS DISTRIBUTIONS: From net realized gains -- -- -- ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 20.80 $ 17.14 $ 18.17 Total return (d) 21.35%(e)(f) (5.67)%(e) 22.85%(e)(f) ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 823,299 $ 825,988 $ 998,943 Ratio of operating expenses to average net assets (g) 1.02%(h) 1.07% 1.09%(h) Ratio of interest expense to average net assets --%(h)(i) -- -- Ratio of total expenses to average net assets (g) 1.02%(h) 1.07% 1.09%(h) Ratio of net investment loss to average net assets (g) (0.62)%(h) (0.75)% (0.80)%(h) Waiver 0.05%(h) 0.05% 0.05%(h) Portfolio turnover rate 39%(f) 139% 78%(f) ------------ ------------ ------------
YEAR ENDED DECEMBER 31, ------------------------------------------------------------------------ CLASS Z SHARES 2002 (b) 2001 2000 1999 ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 19.60 $ 25.99 $ 29.93 $ 23.62 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment loss (0.13)(c) (0.11) (0.10) (0.16) Net realized and unrealized gain (loss) on investments and foreign currency (4.68) (5.35) 4.45 8.74 ------------ ------------ ------------ ------------ Total from investment operations (4.81) (5.46) 4.35 8.58 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net realized gains -- (0.93) (8.29) (2.27) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 14.79 $ 19.60 $ 25.99 $ 29.93 Total return (d) (24.54)%(e) (20.98)% 13.84% 36.33% ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 807,342 $ 786,071 $ 1,095,525 $ 918,322 Ratio of operating expenses to average net assets (g) 1.12% 1.08% 0.99% 1.09% Ratio of interest expense to average net assets -- -- -- -- Ratio of total expenses to average net assets (g) 1.12% 1.08% 0.99% 1.09% Ratio of net investment loss to average net assets (g) (0.85)% (0.49)% (0.38)% (0.64)% Waiver 0.05% -- -- -- Portfolio turnover rate 88% 186% 169% 135% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) On November 1, 2002, the existing Fund shares were renamed Class Z shares. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested. (e) Had the Investment Advisor not waived a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. (i) Rounds to less than 0.01%. 191 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Small Cap Growth Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, CLASS Z SHARES 2005 2004 2003 (a) ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 21.32 $ 21.62 $ 16.30 ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment loss (0.12)(c) (0.24)(c) (0.13)(c) Net realized and unrealized gain (loss) on investments 3.92 (0.06) 5.45 ------------ ------------ ------------ Total from investment operations 3.80 (0.30) 5.32 ------------ ------------ ------------ LESS DISTRIBUTIONS: From net realized gains -- -- -- ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 25.12 $ 21.32 $ 21.62 Total return (d) 17.82%(e) (1.39)% 32.64%(e) ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 261,927 $ 543,016 $ 637,616 Ratio of operating expenses to average net assets (f) 1.20%(g) 1.18% 1.28%(g) Ratio of interest expense to average net assets --%(g)(h) -- -- Ratio of total expenses to average net assets (f) 1.20%(g) 1.18% 1.28%(g) Ratio of net investment loss to average net assets (f) (1.02)%(g) (1.01)% (1.09)%(g) Portfolio turnover rate 70%(e) 118% 79%(e) ------------ ------------ ------------
YEAR ENDED DECEMBER 31, ------------------------------------------------------------------------ CLASS Z SHARES 2002 (b) 2001 2000 1999 ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 22.20 $ 25.87 $ 27.26 $ 17.43 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment loss (0.17)(c) (0.13) (0.10) (0.14) Net realized and unrealized gain (loss) on investments (5.73) (3.54) 1.75 10.45 ------------ ------------ ------------ ------------ Total from investment operations (5.90) (3.67) 1.65 10.31 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net realized gains -- -- (3.04) (0.48) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 16.30 $ 22.20 $ 25.87 $ 27.26 Total return (d) (26.58)% (14.19)% 5.85% 59.15% ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 493,031 $ 617,966 $ 518,970 $ 290,374 Ratio of operating expenses to average net assets (f) 1.24% 1.23% 1.22% 1.30% Ratio of interest expense to average net assets -- -- -- -- Ratio of total expenses to average net assets (f) 1.24% 1.23% 1.22% 1.30% Ratio of net investment loss to average net assets (f) (0.90)% (0.71)% (0.44)% (0.84)% Portfolio turnover rate 109% 129% 145% 188% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) On November 1, 2002, the existing Fund shares were renamed Class Z shares. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested. (e) Not annualized. (f) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (g) Annualized. (h) Rounds to less than 0.01%. 192 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Real Estate Equity Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS A SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 25.59 $ 21.04 $ 17.80 $ 17.01 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.51 0.77 0.36(d) 0.26 Net realized and unrealized gain on investments 2.10 4.67 3.11(d) 0.78 ------------ ------------ ------------ ------------ Total from investment operations 2.61 5.44 3.47 1.04 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.46) (0.70) (0.23) (0.25) From net realized gains (2.52) (0.19) -- -- ------------ ------------ ------------ ------------ Total distributions (2.98) (0.89) (0.23) (0.25) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 25.22 $ 25.59 $ 21.04 $ 17.80 Total return (e) 9.88%(f) 26.42% 19.62%(f) 6.10%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 40,332 $ 32,703 $ 12,364 $ 905 Ratio of expenses to average net assets (g) 1.19%(h) 1.20% 1.55%(h) 1.43%(h) Ratio of net investment income to average net assets (g) 3.93%(h) 3.27% 2.70%(d)(h) 4.81%(h) Portfolio turnover rate 4%(f) 28% 33%(f) 53% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class A shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Effective January 1, 2003, the Fund adopted the policy to reduce cost of investments for financial statement purposes by the distributions received in excess of income from Real Estate Investment Trusts. The effect of this change for the eight months ended August 31, 2003 was to decrease the net investment income per share by $0.05, increase net realized and unrealized gain on investments per share by $0.05 and decrease the ratio of net investment income to average net assets from 3.12% to 2.70%. Per share data and ratios for periods prior to August 31, 2003 have not been restated to reflect this change in policy. (e) Total return at net asset value assuming all distributions reinvested and no initial sales charge or contingent deferred sales charge. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS B SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 25.60 $ 21.03 $ 17.82 $ 17.01 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.42 0.58 0.24(d) 0.22 Net realized and unrealized gain on investments 2.10 4.70 3.12(d) 0.81 ------------ ------------ ------------ ------------ Total from investment operations 2.52 5.28 3.36 1.03 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.36) (0.52) (0.15) (0.22) From net realized gains (2.52) (0.19) -- -- ------------ ------------ ------------ ------------ Total distributions (2.88) (0.71) (0.15) (0.22) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 25.24 $ 25.60 $ 21.03 $ 17.82 Total return (e) 9.51%(f) 25.53% 18.97%(f) 6.09%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 13,534 $ 11,234 $ 4,776 $ 1,074 Ratio of expenses to average net assets (g) 1.94%(h) 1.98% 2.37%(h) 2.18%(h) Ratio of net investment income to average net assets (g) 3.20%(h) 2.47% 1.86%(d)(h) 4.06%(h) Portfolio turnover rate 4%(f) 28% 33%(f) 53% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class B shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Effective January 1, 2003, the Fund adopted the policy to reduce cost of investments for financial statement purposes by the distributions received in excess of income from Real Estate Investment Trusts. The effect of this change for the eight months ended August 31, 2003 was to decrease the net investment income per share by $0.05, increase net realized and unrealized gain on investments per share by $0.05 and decrease the ratio of net investment income to average net assets from 2.28% to 1.86%. Per share data and ratios for periods prior to August 31, 2003 have not been restated to reflect this change in policy. (e) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. 193 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Real Estate Equity Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, CLASS C SHARES 2005 2004 (a) ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 25.58 $ 21.99 ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (b) 0.40 0.41 Net realized and unrealized gain on investments 2.12 3.72 ------------ ------------ Total from investment operations 2.52 4.13 ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.36) (0.35) From net realized gains (2.52) (0.19) ------------ ------------ Total distributions (2.88) (0.54) ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 25.22 $ 25.58 Total return (c)(d) 9.51% 18.99% ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 3,787 $ 2,404 Ratio of expenses to average net assets (e)(f) 1.94% 1.95% Ratio of net investment income to average net assets (e)(f) 3.10% 1.93% Portfolio turnover rate (d) 4% 28% ------------ ------------
(a) Class C shares were initially offered on October 13, 2003. Per share data and total return reflect activity from that date. (b) Per share data was calculated using average shares outstanding during the period. (c) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (d) Not annualized. (e) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (f) Annualized.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS D SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 25.59 $ 21.03 $ 17.82 $ 17.01 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.41 0.65 0.27(d) 0.21 Net realized and unrealized gain on investments 2.11 4.63 3.10(d) 0.82 ------------ ------------ ------------ ------------ Total from investment operations 2.52 5.28 3.37 1.03 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.36) (0.53) (0.16) (0.22) From net realized gains (2.52) (0.19) -- -- ------------ ------------ ------------ ------------ Total distributions (2.88) (0.72) (0.16) (0.22) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 25.23 $ 25.59 $ 21.03 $ 17.82 Total return (e) 9.51%(f) 25.55% 18.99%(f) 6.09%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 4,280 $ 4,059 $ 3,466 $ 365 Ratio of expenses to average net assets (g) 1.94%(h) 1.96% 2.30%(h) 2.18%(h) Ratio of net investment income to average net assets (g) 3.17%(h) 2.81% 2.02%(d)(h) 4.06%(h) Portfolio turnover rate 4%(f) 28% 33%(f) 53% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class D shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Effective January 1, 2003, the Fund adopted the policy to reduce cost of investments for financial statement purposes by the distributions received in excess of income from Real Estate Investment Trusts. The effect of this change for the eight months ended August 31, 2003 was to decrease the net investment income per share by $0.05, increase net realized and unrealized gain on investments per share by $0.05 and decrease the ratio of net investment income to average net assets from 2.44% to 2.02%. Per share data and ratios for periods prior to August 31, 2003 have not been restated to reflect this change in policy. (e) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. 194 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Real Estate Equity Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, CLASS Z SHARES 2005 2004 2003 (a) ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 25.60 $ 21.06 $ 17.81 ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income 0.55(c) 0.88(c) 0.39(c)(d) Net realized and unrealized gain (loss) on investments 2.11 4.62 3.14(d) ------------ ------------ ------------ Total from investment operations 2.66 5.50 3.53 ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.50) (0.77) (0.28) From net realized gains (2.52) (0.19) -- Return of capital -- -- -- ------------ ------------ ------------ Total distributions (3.02) (0.96) (0.28) ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 25.24 $ 25.60 $ 21.06 Total return (e) 10.05%(f) 26.72% 20.01%(f) ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 811,870 $ 872,924 $ 884,747 Ratio of expenses to average net assets (g) 0.94%(h) 0.97% 1.08%(h) Ratio of net investment income to average net assets (g) 4.24%(h) 3.78% 3.09%(d)(h) Portfolio turnover rate 4%(f) 28% 33%(f) ------------ ------------ ------------
YEAR ENDED DECEMBER 31, ------------------------------------------------------------------------ CLASS Z SHARES 2002 (b) 2001 2000 1999 ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 18.04 $ 17.89 $ 14.57 $ 15.76 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income 0.82(c) 0.79 0.81 0.82 Net realized and unrealized gain (loss) on investments (0.25) 0.15 3.32 (1.19) ------------ ------------ ------------ ------------ Total from investment operations 0.57 0.94 4.13 (0.37) ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.71) (0.72) (0.75) (0.71) From net realized gains -- -- -- -- Return of capital (0.09) (0.07) (0.06) (0.11) ------------ ------------ ------------ ------------ Total distributions (0.80) (0.79) (0.81) (0.82) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 17.81 $ 18.04 $ 17.89 $ 14.57 Total return (e) 3.12% 5.41% 28.84% (2.45)% ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 774,646 $ 621,590 $ 436,764 $ 241,716 Ratio of expenses to average net assets (g) 0.94% 0.95% 0.96% 0.99% Ratio of net investment income to average net assets (g) 5.30% 4.65% 5.16% 5.66% Portfolio turnover rate 53% 41% 25% 29% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) On November 1, 2002, the existing Fund shares were renamed Class Z shares. (c) Per share data was calculated using average shares outstanding during the period. (d) Effective January 1, 2003, the Fund adopted the policy to reduce cost of investments for financial statement purposes by the distributions received in excess of income from Real Estate Investment Trusts. The effect of this change for the eight months ended August 31, 2003 was to decrease the net investment income per share by $0.05, increase net realized and unrealized gain on investments per share by $0.05 and decrease the ratio of net investment income to average net assets from 3.51% to 3.09%. Per share data and ratios for periods prior to August 31, 2003 have not been restated to reflect this change in policy. (e) Total return at net asset value assuming all distributions reinvested. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. 195 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Technology Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS A SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 6.50 $ 5.91 $ 3.79 $ 3.82 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment loss (c) (0.07) (0.11) (0.04) (0.01) Net realized and unrealized gain (loss) on investments, futures contracts and written options 1.40 0.70 2.16 (0.02) ------------ ------------ ------------ ------------ Total from investment operations 1.33 0.59 2.12 (0.03) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 7.83 $ 6.50 $ 5.91 $ 3.79 Total return (d)(e) 20.46%(f) 9.98% 55.94%(f) (0.79)%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 7,287 $ 2,818 $ 376 $ 1 Ratio of expenses to average net assets (g) 1.90%(h) 1.90% 1.90%(h) 1.76%(h) Ratio of net investment loss to average net assets (g) (1.74)%(h) (1.51)% (1.35)%(h) (1.35)%(h) Reimbursement 0.21%(h) 0.53% 3.06%(h) 1.24%(h) Portfolio turnover rate 181%(f) 488% 523%(f) 512% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class A shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming no initial sales charge or contingent deferred sales charge. (e) Had the Investment Advisor not reimbursed a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS B SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 6.40 $ 5.86 $ 3.78 $ 3.82 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment loss (c) (0.09) (0.16) (0.07) (0.01) Net realized and unrealized gain (loss) on investments, futures contracts and written options 1.36 0.70 2.15 (0.03) ------------ ------------ ------------ ------------ Total from investment operations 1.27 0.54 2.08 (0.04) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 7.67 $ 6.40 $ 5.86 $ 3.78 Total return (d)(e) 19.84%(f) 9.22% 55.03%(f) (1.05)%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 2,831 $ 2,200 $ 1,246 $ 7 Ratio of expenses to average net assets (g) 2.65%(h) 2.65% 2.65%(h) 2.51%(h) Ratio of net investment loss to average net assets (g) (2.49)%(h) (2.30)% (2.11)%(h) (2.10)%(h) Reimbursement 0.21%(h) 0.48% 2.40%(h) 1.24%(h) Portfolio turnover rate 181%(f) 488% 523%(f) 512% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class B shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming no contingent deferred sales charge. (e) Had the Investment Advisor not reimbursed a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. 196 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Technology Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, CLASS C SHARES 2005 2004 (a) ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 6.41 $ 6.48 ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment loss (b) (0.09) (0.14) Net realized and unrealized gain on investments, futures contracts and written options 1.37 0.07 ------------ ------------ Total from investment operations 1.28 (0.07) ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 7.69 $ 6.41 Total return (c)(d)(e) 19.97% (1.08)% ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 1,390 $ 488 Ratio of expenses to average net assets (f)(g) 2.65% 2.65% Ratio of net investment loss to average net assets (f)(g) (2.49)% (2.18)% Reimbursement (g) 0.21% 0.68% Portfolio turnover rate 181%(e) 488% ------------ ------------
(a) Class C shares were initially offered on October 13, 2003. Per share data and total return reflect activity from that date. (b) Per share data was calculated using average shares outstanding during the period. (c) Total return at net asset value assuming no contingent deferred sales charge. (d) Had the Investment Advisor not reimbursed a portion of expenses, total return would have been reduced. (e) Not annualized. (f) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (g) Annualized.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS D SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 6.43 $ 5.88 $ 3.78 $ 3.82 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment loss (c) (0.09) (0.16) (0.07) (0.01) Net realized and unrealized gain (loss) on investments, futures contracts and written options 1.38 0.71 2.17 (0.03) ------------ ------------ ------------ ------------ Total from investment operations 1.29 0.55 2.10 (0.04) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 7.72 $ 6.43 $ 5.88 $ 3.78 Total return (d)(e) 20.06%(f) 9.35% 55.56%(f) (1.05)%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 21 $ 21 $ 15 $ 1 Ratio of expenses to average net assets (g) 2.65%(h) 2.65% 2.65%(h) 2.51%(h) Ratio of net investment loss to average net assets (g) (2.49)%(h) (2.31)% (2.13)%(h) (2.10)%(h) Reimbursement 0.21%(h) 0.77% 4.00%(h) 1.24%(h) Portfolio turnover rate 181%(f) 488% 523%(f) 512% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class D shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming no contingent deferred sales charge. (e) Had the Investment Advisor not reimbursed a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. 197 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Technology Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, CLASS Z SHARES 2005 2004 2003 (a) ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 6.55 $ 5.93 $ 3.79 ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) (0.06)(d) (0.09)(d) (0.04)(d) Net realized and unrealized gain (loss) on investments, futures contracts and written options 1.40 0.71 2.18 ------------ ------------ ------------ Total from investment operations 1.34 0.62 2.14 ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income -- -- -- ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 7.89 $ 6.55 $ 5.93 Total return (e)(f) 20.46%(g) 10.46% 56.46%(g) ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 32,053 $ 30,268 $ 19,663 Ratio of expenses to average net assets (h) 1.65%(i) 1.65% 1.65%(i) Ratio of net investment income (loss) to average net assets (h) (1.49)%(i) (1.30)% (1.19)%(i) Reimbursement 0.21%(i) 0.53% 2.73%(i) Portfolio turnover rate 181%(g) 488% 523%(g) ------------ ------------ ------------
YEAR ENDED DECEMBER 31, PERIOD ENDED -------------------------------- DECEMBER 31, CLASS Z SHARES 2002 (b) 2001 2000 (c) ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 6.13 $ 8.63 $ 10.00 ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss) (0.06)(d) (0.08) 0.01 Net realized and unrealized gain (loss) on investments, futures contracts and written options (2.28) (2.42) (1.37) ------------ ------------ ------------ Total from investment operations (2.34) (2.50) (1.36) ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income -- -- (0.01) ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 3.79 $ 6.13 $ 8.63 Total return (e)(f) (38.17)% (28.97)% (13.78)%(g) ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 8,055 $ 10,385 $ 4,327 Ratio of expenses to average net assets (h) 1.65% 1.69% 1.48%(i) Ratio of net investment income (loss) to average net assets (h) (1.24)% (1.26)% 0.99%(i) Reimbursement 1.33% 1.13% 7.49%(i) Portfolio turnover rate 512% 413% 63%(g) ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) On November 1, 2002, the existing Fund shares were renamed Class Z shares. (c) The Fund commenced investment operations on October 27, 2000. Per share data, total return and portfolio turnover rate reflect activity from that date. (d) Per share data was calculated using average shares outstanding during the period. (e) Total return at net asset value assuming all distributions reinvested. (f) Had the Investment Advisor not reimbursed a portion of expenses, total return would have been reduced. (g) Not annualized. (h) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (i) Annualized. 198 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Strategic Investor Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS A SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 18.37 $ 15.95 $ 13.13 $ 12.72 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.04 0.03 0.06 0.01 Net realized and unrealized gain on investments and foreign currency 2.33 2.46 2.76 0.40 ------------ ------------ ------------ ------------ Total from investment operations 2.37 2.49 2.82 0.41 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.03) (0.07) -- -- From net realized gains (0.22) -- -- -- ------------ ------------ ------------ ------------ Total distributions (0.25) (0.07) -- -- NET ASSET VALUE, END OF PERIOD $ 20.49 $ 18.37 $ 15.95 $ 13.13 Total return (d) 12.91%(e)(f) 15.64%(e) 21.48%(f) 3.22%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 143,707 $ 99,608 $ 60,112 $ 53,526 Ratio of expenses to average net assets (g) 1.22%(h) 1.27% 1.30%(h) 1.21%(h) Ratio of net investment income to average net assets (g) 0.38%(h) 0.19% 0.60%(h) 0.64%(h) Waiver 0.03%(h) 0.01% -- Portfolio turnover rate 39%(f) 106% 68%(f) 188 % ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class A shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested and no initial sales charge or contingent deferred sales charge. (e) Had the Investment Advisor not waived a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS B SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 18.17 $ 15.82 $ 13.10 $ 12.72 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment loss (c) (0.03) (0.10) (0.03) (0.01) Net realized and unrealized gain on investments and foreign currency 2.30 2.45 2.75 0.39 ------------ ------------ ------------ ------------ Total from investment operations 2.27 2.35 2.72 0.38 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net realized gains (0.22) -- -- -- ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 20.22 $ 18.17 $ 15.82 $ 13.10 Total return (d)(e) 12.52%(f) 14.85% 20.76%(f) 2.99%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 38,294 $ 22,071 $ 3,398 $ 2,350 Ratio of expenses to average net assets (g) 1.97%(h) 2.02% 2.22%(h) 2.36%(h) Ratio of net investment loss to average net assets (g) (0.37)%(h) (0.57)% (0.33)%(h) (0.51)%(h) Waiver 0.03%(h) 0.14% 0.23%(h) 0.23%(h) Portfolio turnover rate 39%(f) 106% 68%(f) 188% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class B shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (e) Had the Investment Advisor not waived a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. 199 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Strategic Investor Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, CLASS C SHARES 2005 2004 (a) ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 18.18 $ 16.42 ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment loss (b) (0.03) (0.09) Net realized and unrealized gain on investments and foreign currency 2.29 1.85 ------------ ------------ Total from investment operations 2.26 1.76 ------------ ------------ LESS DISTRIBUTIONS: From net realized gains (0.22) -- NET ASSET VALUE, END OF PERIOD $ 20.22 $ 18.18 ------------ ------------ Total return (c)(d)(e) 12.45% 10.72% RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 30,185 $ 14,821 Ratio of expenses to average net assets (f)(g) 1.97% 2.05% Ratio of net investment loss to average net assets (f)(g) (0.37)% (0.57)% Waiver (g) 0.03% 0.07% Portfolio turnover rate 39%(e) 106% ------------ ------------
(a) Class C shares were initially offered on October 13, 2003. Per share data and total return reflect activity from that date. (b) Per share data was calculated using average shares outstanding during the period. (c) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (d) Had the Investment Advisor not waived a portion of expenses, total return would have been reduced. (e) Not annualized. (f) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (g) Annualized.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS D SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 18.17 $ 15.81 $ 13.11 $ 12.72 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment loss (c) (0.03) (0.08) (0.05) (0.01) Net realized and unrealized gain on investments and foreign currency 2.29 2.44 2.75 0.40 ------------ ------------ ------------ ------------ Total from investment operations 2.26 2.36 2.70 0.39 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net realized gains (0.22) -- -- -- ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 20.21 $ 18.17 $ 15.81 $ 13.11 Total return (d)(e) 12.46%(f) 14.93% 20.59%(f) 3.07%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 650 $ 693 $ 704 $ 355 Ratio of expenses to average net assets (g) 1.97%(h) 1.94% 2.34%(h) 2.28%(h) Ratio of net investment loss to average net assets (g) (0.37)%(h) (0.48)% (0.48)%(h) (0.43)%(h) Waiver 0.03%(h) 0.12% 0.15%(h) 0.15%(h) Portfolio turnover rate 39%(f) 106% 68%(f) 188% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class D shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (e) Had the Investment Advisor not waived a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. 200 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Strategic Investor Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, CLASS Z SHARES 2005 2004 2003 (a) ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 18.42 $ 15.98 $ 13.14 ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income 0.06(d) 0.08(d) 0.08(d) Net realized and unrealized gain (loss) on investments and foreign currency 2.34 2.47 2.76 ------------ ------------ ------------ Total from investment operations 2.40 2.55 2.84 ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.07) (0.11) -- From net realized gains (0.22) -- -- ------------ ------------ ------------ Total distributions (0.29) (0.11) -- ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 20.53 $ 18.42 $ 15.98 Total return (e) 13.08%(f)(g) 15.98%(f) 21.61%(f)(g) ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 288,290 $ 272,178 $ 227,454 Ratio of expenses to average net assets (h) 0.97%(i) 1.02% 1.08%(i) Ratio of net investment income to average net assets (h) 0.63%(i) 0.44% 0.82%(i) Waiver 0.03%(i) 0.03% 0.03%(i) Portfolio turnover rate 39%(g) 106% 68%(g) ------------ ------------ ------------
YEAR ENDED DECEMBER 31, PERIOD ENDED -------------------------------- DECEMBER 31, CLASS Z SHARES 2002 (b) 2001 2000 (c) ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 14.52 $ 11.23 $ 10.00 ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income 0.10(d) 0.05 0.02 Net realized and unrealized gain (loss) on investments and foreign currency (1.35) 3.29 1.23 ------------ ------------ ------------ Total from investment operations (1.25) 3.34 1.25 ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.11) (0.05) (0.02) From net realized gains (0.02) -- -- ------------ ------------ ------------ Total distributions (0.13) (0.05) (0.02) ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 13.14 $ 14.52 $ 11.23 Total return (e) (8.56)%(f) 29.76% 12.25%(f)(g) ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 209,610 $ 139,504 $ 9,526 Ratio of expenses to average net assets (h) 1.23% 1.13% 1.34%(i) Ratio of net investment income to average net assets (h) 0.62% 0.71% 1.92%(i) Waiver 0.03% -- 3.97%(i) Portfolio turnover rate 188% 278% 64%(g) ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) On November 1, 2002, the existing Fund shares were renamed Class Z shares. (c) The Fund commenced investment operations on October 27, 2000. Per share data, total return and portfolio turnover rate reflect activity from that date. (d) Per share data was calculated using average shares outstanding during the period. (e) Total return at net asset value assuming all distributions reinvested. (f) Had the Investment Advisor not waived a portion of expenses, total return would have been reduced. (g) Not annualized. (h) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (i) Annualized. 201 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Balanced Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS A SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 19.86 $ 19.18 $ 17.52 $ 17.58 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.21(d) 0.29 0.16 0.03 Net realized and unrealized gain on investments 1.16 0.67 1.64 --(e) ------------ ------------ ------------ ------------ Total from investment operations 1.37 0.96 1.80 0.03 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.22) (0.28) (0.14) (0.09) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 21.01 $ 19.86 $ 19.18 $ 17.52 Total return (f) 6.94%(g) 4.99 10.35%(g) 0.19%(g) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 2,906 $ 2,577 $ 670 $ 146 Ratio of expenses to average net assets (h) 1.03%(i) 1.02% 1.42%(i) 1.17%(i) Ratio of net investment income to average net assets (h) 2.10%(i) 1.45% 1.32%(i) 2.03%(i) Portfolio turnover rate 28%(g) 158% 110%(g) 98% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class A shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Net investment income per share reflects a special dividend which amounted to $0.06 per share. (e) Rounds to less than $0.01 per share. (f) Total return at net asset value assuming all distributions reinvested and no initial sales charge or contingent deferred sales charge. (g) Not annualized. (h) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (i) Annualized.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS B SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 19.83 $ 19.16 $ 17.52 $ 17.58 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.14(d) 0.14 0.07 0.02 Net realized and unrealized gain (loss) on investments 1.16 0.66 1.65 (0.01) ------------ ------------ ------------ ------------ Total from investment operations 1.30 0.80 1.72 0.01 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.15) (0.13) (0.08) (0.07) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 20.98 $ 19.83 $ 19.16 $ 17.52 Total return (e) 6.55%(f) 4.17% 9.83%(f) 0.06%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 7,837 $ 7,286 $ 3,349 $ 608 Ratio of expenses to average net assets (g) 1.78%(h) 1.77% 2.17%(h) 1.92%(h) Ratio of net investment income to average net assets (g) 1.35%(h) 0.71% 0.59%(h) 1.28%(h) Portfolio turnover rate 28%(f) 158% 110%(f) 98% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class B shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Net investment income per share reflects a special dividend which amounted to $0.06 per share. (e) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. 202 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Balanced Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, CLASS C SHARES 2005 2004 (a) ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 19.83 $ 19.59 ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (b) 0.14(c) 0.13 Net realized and unrealized gain on investments 1.16 0.23 ------------ ------------ Total from investment operations 1.30 0.36 ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.15) (0.12) ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 20.98 $ 19.83 Total return (d)(e) 6.55% 1.82% ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 842 $ 730 Ratio of expenses to average net assets (f)(g) 1.78% 1.80% Ratio of net investment income to average net assets (f)(g) 1.35% 0.72% Portfolio turnover rate 28%(e) 158% ------------ ------------
(a) Class C shares were initially offered on October 13, 2003. Per share data and total return reflect activity from that date. (b) Per share data was calculated using average shares outstanding during the period. (c) Net investment income per share reflects a special dividend which amounted to $0.06 per share. (d) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (e) Not annualized. (f) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (g) Annualized.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS D SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 19.82 $ 19.17 $ 17.51 $ 17.58 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.14(d) 0.15 0.11 0.02 Net realized and unrealized gain (loss) on investments 1.17 0.65 1.64 (0.02) ------------ ------------ ------------ ------------ Total from investment operations 1.31 0.80 1.75 -- ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.15) (0.15) (0.09) (0.07) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 20.98 $ 19.82 $ 19.17 $ 17.51 Total return (e) 6.61%(f) 4.14% 10.01%(f) 0.01%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 329 $ 361 $ 770 $ 446 Ratio of expenses to average net assets (g) 1.78%(h) 1.77% 1.87%(h) 1.92%(h) Ratio of net investment income to average net assets (g) 1.35%(h) 0.74% 0.89%(h) 1.28%(h) Portfolio turnover rate 28%(f) 158% 110%(f) 98% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class D shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Net investment income per share reflects a special dividend which amounted to $0.06 per share. (e) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. 203 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Balanced Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, CLASS Z SHARES 2005 2004 2003 (a) ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 19.84 $ 19.19 $ 17.51 ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income 0.24(c)(d) 0.35(c) 0.24(c) Net realized and unrealized gain (loss) on investments 1.17 0.66 1.64 ------------ ------------ ------------ Total from investment operations 1.41 1.01 1.88 ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.25) (0.36) (0.20) From net realized gains -- -- -- ------------ ------------ ------------ Total distributions (0.25) (0.36) (0.20) ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 21.00 $ 19.84 $ 19.19 Total return (f) 7.13%(g) 5.27% 10.81%(g) ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 373,256 $ 483,746 $ 640,402 Ratio of expenses to average net assets (h) 0.78%(i) 0.77% 0.77%(i) Ratio of net investment income to average net assets (h) 2.35%(i) 1.73% 2.03%(i) Portfolio turnover rate 28%(g) 158% 110%(g) ------------ ------------ ------------
YEAR ENDED DECEMBER 31, ------------------------------------------------------------------------ CLASS Z SHARES 2002 (b) 2001 2000 1999 ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 20.67 $ 22.96 $ 24.72 $ 23.17 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income 0.47(c) 0.57(e) 0.67 0.69 Net realized and unrealized gain (loss) on investments (3.13) (2.27)(e) (0.41) 2.21 ------------ ------------ ------------ ------------ Total from investment operations (2.66) (1.70) 0.26 2.90 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.50) (0.59) (0.68) (0.69) From net realized gains -- -- (1.34) (0.66) ------------ ------------ ------------ ------------ Total distributions (0.50) (0.59) (2.02) (1.35) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 17.51 $ 20.67 $ 22.96 $ 24.72 Total return (f) (12.97)% (7.40)% 0.82% 12.70% ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 668,290 $ 983,749 $ 1,126,854 $ 1,040,940 Ratio of expenses to average net assets (h) 0.70% 0.67% 0.65% 0.66% Ratio of net investment income to average net assets (h) 2.50% 2.70%(e) 2.73% 2.85% Portfolio turnover rate 98% 111% 105% 133% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) On November 1, 2002, the existing Fund shares were renamed Class Z shares. (c) Per share data was calculated using average shares outstanding during the period. (d) Net investment income per share reflects a special dividend which amounted to $0.06 per share. (e) Effective January 1, 2001, the Fund adopted the provisions of the AICPA Audit and Accounting Guide for Investment Companies and began amortizing premium and accreting discount on all debt securities. The effect of this change for the year ended December 31, 2001 was to decrease net investment income per share by $0.01, decrease net realized and unrealized loss per share by $0.01 and decrease the ratio of net investment income to average net assets from 2.73% to 2.70%. Per share data and ratios for periods prior to December 31, 2001 have not been restated to reflect this change in presentation. (f) Total return at net asset value assuming all distributions reinvested. (g) Not annualized. (h) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (i) Annualized. 204 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Short Term Bond Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS A SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 8.64 $ 8.62 $ 8.67 $ 8.63 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.11 0.17 0.10 0.04 Net realized and unrealized gain (loss) on investments and futures contracts (0.06) 0.02 (0.03) 0.04 ------------ ------------ ------------ ------------ Total from investment operations 0.05 0.19 0.07 0.08 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.11) (0.17) (0.12) (0.04) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 8.58 $ 8.64 $ 8.62 $ 8.67 Total return (d)(e) 0.54%(f) 2.25% 0.82%(f) 0.94%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 24,089 $ 28,146 $ 37,261 $ 5,543 Ratio of expenses to average net assets (g) 0.89%(h) 0.91% 1.00%(h) 1.00%(h) Ratio of net investment income to average net assets (g) 2.48%(h) 2.00% 1.78%(h) 3.53%(h) Reimbursement 0.01%(h) 0.05% 0.05%(h) 0.02%(h) Portfolio turnover rate 18%(f) 77% 137%(f) 182% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class A shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested and no initial sales charge or contingent deferred sales charge. (e) Had the Investment Advisor not reimbursed a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS B SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 8.64 $ 8.62 $ 8.67 $ 8.63 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.07 0.11 0.07 0.03 Net realized and unrealized gain (loss) on investments and futures contracts (0.06) 0.01 (0.04) 0.04 ------------ ------------ ------------ ------------ Total from investment operations 0.01 0.12 0.03 0.07 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.07) (0.10) (0.08) (0.03) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 8.58 $ 8.64 $ 8.62 $ 8.67 Total return (d)(e) 0.16%(f) 1.44% 0.35%(f) 0.77%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 22,109 $ 25,125 $ 26,965 $ 6,261 Ratio of expenses to average net assets (g) 1.64%(h) 1.66% 1.75%(h) 1.75%(h) Ratio of net investment income to average net assets (g) 1.73%(h) 1.25% 1.16%(h) 2.78%(h) Reimbursement 0.01%(h) 0.08% 0.15%(h) 0.04%(h) Portfolio turnover rate 18%(f) 77% 137%(f) 182% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class B shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (e) Had the Investment Advisor not reimbursed a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. 205 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Short Term Bond Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, CLASS C SHARES 2005 2004 (a) ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 8.64 $ 8.67 ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (b) 0.10 0.15 Net realized and unrealized loss on investments and futures contracts (0.06) (0.04) ------------ ------------ Total from investment operations 0.04 0.11 ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.10) (0.14) ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 8.58 $ 8.64 Total return (c)(d)(e) 0.47% 1.27% ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 3,121 $ 3,128 Ratio of expenses to average net assets (f)(g) 1.04% 1.06% Ratio of net investment income to average net assets (f)(g) 2.33% 1.88% Reimbursement (g) 0.01% 0.05% Waiver (g)(h) 0.60% 0.60% Portfolio turnover rate 18%(e) 77% ------------ ------------
(a) Class C shares were initially offered on October 13, 2003. Per share data and total return reflect activity from that date. (b) Per share data was calculated using average shares outstanding during the period. (c) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (d) Had the Investment Advisor/Distributor not waived or reimbursed a portion of expenses, total return would have been reduced. (e) Not annualized. (f) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (g) Annualized. (h) Amounts represent voluntary waivers of service and distribution fees.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS D SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 8.64 $ 8.62 $ 8.67 $ 8.63 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.10 0.16 0.10 0.04 Net realized and unrealized gain (loss) on investments and futures contracts (0.06) 0.02 (0.04) 0.04 ------------ ------------ ------------ ------------ Total from investment operations 0.04 0.18 0.06 0.08 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.10) (0.16) (0.11) (0.04) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 8.58 $ 8.64 $ 8.62 $ 8.67 Total return (d)(e) 0.47%(f) 2.08% 0.72%(f) 0.88%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 7,600 $ 9,809 $ 18,512 $ 5,223 Ratio of expenses to average net assets (g) 1.04%(h) 1.06% 1.15%(h) 1.15%(h) Ratio of net investment income to average net assets (g) 2.33%(h) 1.85% 1.71%(h) 3.38%(h) Reimbursement 0.01%(h) 0.03% 0.18%(h) 0.04%(h) Waiver (i) 0.60%(h) 0.60% 0.60%(h) 0.60%(h) Portfolio turnover rate 18%(f) 77% 137%(f) 182% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class D shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (e) Had the Investment Advisor/Distributor not waived or reimbursed a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. (i) Amounts represent voluntary waivers of service and distribution fees. 206 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Short Term Bond Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS G SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 8.64 $ 8.62 $ 8.67 $ 8.63 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.08 0.12 0.09 0.03 Net realized and unrealized gain (loss) on investments and futures contracts (0.06) 0.02 (0.05) 0.04 ------------ ------------ ------------ ------------ Total from investment operations 0.02 0.14 0.04 0.07 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.08) (0.12) (0.09) (0.03) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 8.58 $ 8.64 $ 8.62 $ 8.67 Total return (d)(e) 0.26%(f) 1.65% 0.47%(f) 0.85%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 881 $ 1,056 $ 1,614 $ 1,874 Ratio of expenses to average net assets (g) 1.44%(h) 1.46% 1.55%(h) 1.55%(h) Ratio of net investment income to average net assets (g) 1.93%(h) 1.44% 1.58%(h) 2.98%(h) Reimbursement 0.01%(h) 0.16% 0.10%(h) 0.05%(h) Portfolio turnover rate 18%(f) 77% 137%(f) 182% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class G shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (e) Had the Investment Advisor/Distributor not reimbursed a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS T SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 8.64 $ 8.62 $ 8.67 $ 8.63 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.11 0.18 0.13 0.04 Net realized and unrealized gain (loss) on investments and futures contracts (0.06) 0.02 (0.05) 0.04 ------------ ------------ ------------ ------------ Total from investment operations 0.05 0.20 0.08 0.08 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.11) (0.18) (0.13) (0.04) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 8.58 $ 8.64 $ 8.62 $ 8.67 Total return (d)(e) 0.59%(f) 2.31% 0.93%(f) 0.95%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 19,466 $ 21,160 $ 28,230 $ 30,859 Ratio of expenses to average net assets (g) 0.79%(h) 0.81% 0.90%(h) 0.90%(h) Ratio of net investment income to average net assets (g) 2.58%(h) 2.10% 2.25%(h) 3.63%(h) Reimbursement 0.01%(h) 0.05% 0.04%(h) 0.02%(h) Portfolio turnover rate 18%(f) 77% 137%(f) 182% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class T shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested and no initial sales charge or contingent deferred sales charge. (e) Had the Investment Advisor/Distributor not reimbursed a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. 207 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Short Term Bond Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, CLASS Z SHARES 2005 2004 2003 (a) ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 8.64 $ 8.62 $ 8.67 ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income 0.12(c) 0.20(c) 0.14(c) Net realized and unrealized gain (loss) on investments and futures contracts (0.06) 0.01 (0.05) ------------ ------------ ------------ Total from investment operations 0.06 0.21 0.09 ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.12) (0.19) (0.14) From net realized gains -- -- -- ------------ ------------ ------------ Total distributions (0.12) (0.19) (0.14) ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 8.58 $ 8.64 $ 8.62 Total return (f) 0.66%(g)(h) 2.51%(g) 1.06%(g)(h) ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 415,886 $ 437,074 $ 436,593 Ratio of expenses to average net assets (i) 0.64%(j) 0.66% 0.66%(j) Ratio of net investment income to average net assets (i) 2.73%(j) 2.27% 2.36%(j) Reimbursement 0.01%(j) 0.05% 0.07%(j) Portfolio turnover rate 18%(h) 77% 137%(h) ------------ ------------ ------------
YEAR ENDED DECEMBER 31, ------------------------------------------------------------------------ CLASS Z SHARES 2002 (b) 2001 2000 1999 ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 8.55 $ 8.36 $ 8.20 $ 8.39 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income 0.32(c) 0.46(d) 0.42 0.33 Net realized and unrealized gain (loss) on investments and futures contracts 0.14 0.21(d) 0.16 (0.18) ------------ ------------ ------------ ------------ Total from investment operations 0.46 0.67 0.58 0.15 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.34) (0.46) (0.42) (0.33) From net realized gains --(e) (0.02) -- (0.01) ------------ ------------ ------------ ------------ Total distributions (0.34) (0.48) (0.42) (0.34) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 8.67 $ 8.55 $ 8.36 $ 8.20 Total return (f) 5.56% 8.07%(g) 7.26%(g) 1.80% ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 317,588 $ 62,930 $ 35,856 $ 38,072 Ratio of expenses to average net assets (i) 0.67% 0.75% 0.88% 0.91% Ratio of net investment income to average net assets (i) 3.86% 5.29%(d) 5.09% 4.09% Reimbursement -- 0.16% 0.02% -- Portfolio turnover rate 182% 137% 147% 211% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) On November 1, 2002, the existing Fund shares were renamed Class Z shares. (c) Per share data was calculated using average shares outstanding during the period. (d) Effective January 1, 2001, the Fund adopted the provisions of the AICPA Audit and Accounting Guide for Investment Companies and began amortizing premium and accreting discount on all debt securities. The effect of this change for the year ended December 31, 2001 was to increase the ratio of net investment income to average net assets from 5.26% to 5.29%. The impact to net investment income and net realized and unrealized gain per share was less than $0.01. Per share data and ratios for periods prior to December 31, 2001 have not been restated to reflect this change in presentation. (e) Rounds to less than $0.01 per share. (f) Total return at net asset value assuming all distributions reinvested. (g) Had the Investment Advisor not reimbursed a portion of expenses, total return would have been reduced. (h) Not annualized. (i) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (j) Annualized. 208 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Fixed Income Securities Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS A SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 13.49 $ 13.34 $ 13.52 $ 13.42 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.24 0.50 0.26 0.11 Net realized and unrealized gain (loss) on investments (0.05) 0.17 (0.14) 0.08 ------------ ------------ ------------ ------------ Total from investment operations 0.19 0.67 0.12 0.19 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.26) (0.52) (0.30) (0.09) From net realized gains (0.14) -- -- -- ------------ ------------ ------------ ------------ Total distributions (0.40) (0.52) (0.30) (0.09) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 13.28 $ 13.49 $ 13.34 $ 13.52 Total return (d) 1.41%(e) 5.13% 0.84%(e) 1.41%(e) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 12,184 $ 10,707 $ 7,503 $ 945 Ratio of expenses to average net assets (f) 1.10%(g) 1.05% 1.44%(g) 0.92%(g) Ratio of net investment income to average net assets (f) 3.67%(g) 3.70% 2.84%(g) 4.78%(g) Portfolio turnover rate 15%(e) 124% 161%(e) 103% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class A shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested and no initial sales charge or contingent deferred sales charge. (e) Not annualized. (f) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (g) Annualized.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS B SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 13.49 $ 13.34 $ 13.52 $ 13.42 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.20 0.40 0.20 0.09 Net realized and unrealized gain (loss) on investments (0.06) 0.17 (0.15) 0.08 ------------ ------------ ------------ ------------ Total from investment operations 0.14 0.57 0.05 0.17 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.21) (0.42) (0.23) (0.07) From net realized gains (0.14) -- -- -- ------------ ------------ ------------ ------------ Total distributions (0.35) (0.42) (0.23) (0.07) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 13.28 $ 13.49 $ 13.34 $ 13.52 Total return (d) 1.04%(e) 4.33% 0.34%(e) 1.27%(e) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 4,027 $ 4,334 $ 4,410 $ 1,466 Ratio of expenses to average net assets (f) 1.85%(g) 1.82% 2.10%(g) 1.71%(g) Ratio of net investment income to average net assets (f) 2.92%(g) 2.94% 2.22%(g) 3.99%(g) Portfolio turnover rate 15%(e) 124% 161%(e) 103% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class B shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (e) Not annualized. (f) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (g) Annualized. 209 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Fixed Income Securities Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, CLASS C SHARES 2005 2004 (a) ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 13.49 $ 13.50 ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (b) 0.20 0.37 Net realized and unrealized gain (loss) on investments (0.05) 0.02 ------------ ------------ Total from investment operations 0.15 0.39 ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.22) (0.40) From net realized gains (0.14) -- ------------ ------------ Total distributions (0.36) (0.40) ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 13.28 $ 13.49 Total return (c)(d)(e) 1.11% 2.94% ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 221 $ 158 Ratio of expenses to average net assets (f)(g) 1.70% 1.64% Ratio of net investment income to average net assets (f)(g) 3.07% 3.09% Waiver (g)(h) 0.15% 0.15% Portfolio turnover rate 15%(e) 124% ------------ ------------
(a) Class C shares were initially offered on October 13, 2003. Per share data and total return reflect activity from that date. (b) Per share data was calculated using average shares outstanding during the period. (c) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (d) Had the Distributor not waived a portion of expenses, total return would have been reduced. (e) Not annualized. (f) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (g) Annualized. (h) Amounts represent voluntary waiver of service and distribution fees.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS D SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 13.49 $ 13.34 $ 13.52 $ 13.42 ------------ ------------ ------------ ------------ Income from investment operations: Net investment income (c) 0.21 0.42 0.22 0.09 Net realized and unrealized gain (loss) on investments (0.06) 0.17 (0.15) 0.08 ------------ ------------ ------------ ------------ Total from investment operations 0.15 0.59 0.07 0.17 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.22) (0.44) (0.25) (0.07) From net realized gains (0.14) -- -- -- ------------ ------------ ------------ ------------ Total distributions (0.36) (0.44) (0.25) (0.07) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 13.28 $ 13.49 $ 13.34 $ 13.52 Total return (d)(e) 1.11%(f) 4.51% 0.51%(f) 1.30%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 1,496 $ 1,745 $ 2,632 $ 427 Ratio of expenses to average net assets (g) 1.70%(h) 1.65% 1.79%(h) 1.58%(h) Ratio of net investment income to average net assets (g) 3.07%(h) 3.11% 2.44%(h) 4.12%(h) Waiver (i) 0.15%(h) 0.15% 0.15%(h) 0.15%(h) Portfolio turnover rate 15%(f) 124% 161%(f) 103% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class D shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (e) Had the Distributor not waived a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. (i) Amounts represent voluntary waiver of service and distribution fees. 210 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Fixed Income Securities Fund FOR A FUND SHARE OUTSTANDING THROUGH/HOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, CLASS Z SHARES 2005 2004 2003 (a) ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 13.49 $ 13.34 $ 13.52 ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income 0.26(c) 0.53(c) 0.33(c) Net realized and unrealized gain (loss) on investments (0.06) 0.18 (0.16) ------------ ------------ ------------ Total from investment operations 0.20 0.71 0.17 ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.27) (0.56) (0.35) From net realized gains (0.14) -- -- ------------ ------------ ------------ Total distributions (0.41) (0.56) (0.35) NET ASSET VALUE, END OF PERIOD $ 13.28 $ 13.49 $ 13.34 Total return (f) 1.51%(g) 5.40% 1.26%(g) ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 265,127 $ 324,325 $ 506,046 Ratio of expenses to average net assets (h) 0.85%(i) 0.80% 0.77%(i) Ratio of net investment income to average net assets (h) 3.92%(i) 3.96% 3.66%(i) Portfolio turnover rate 15%(g) 124% 161%(g) ------------ ------------ ------------
YEAR ENDED DECEMBER 31, ------------------------------------------------------------------------ 2002 (b) 2001 2000 1999 ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 13.22 $ 12.97 $ 12.44 $ 13.42 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income 0.67(c) 0.77(d) 0.82 0.78 Net realized and unrealized gain (loss) on investments 0.31 0.26(d) 0.53 (0.98) ------------ ------------ ------------ ------------ Total from investment operations 0.98 1.03 1.35 (0.20) ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.68) (0.78) (0.82) (0.78) From net realized gains -- -- -- --(e) ------------ ------------ ------------ ------------ Total distributions (0.68) (0.78) (0.82) (0.78) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 13.52 $ 13.22 $ 12.97 $ 12.44 Total return (f) 7.65% 8.13% 11.27% (1.50)% ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 547,524 $ 465,743 $ 378,799 $ 397,147 Ratio of expenses to average net assets (h) 0.67% 0.66% 0.66% 0.64% Ratio of net investment income to average net assets (h) 5.03% 5.83%(d) 6.53% 6.03% Portfolio turnover rate 103% 110% 105% 155% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) On November 1, 2002, the existing Fund shares were renamed Class Z shares. (c) Per share data was calculated using average shares outstanding during the period. (d) Effective January 1, 2001, the Fund adopted the provisions of the AICPA Audit and Accounting Guide for Investment Companies and began amortizing premium and accreting discount on all debt securities. The effect of this change for the year ended December 31, 2001 was to decrease net investment income per share by $0.01, increase net realized and unrealized gain per share by $0.01 and decrease the ratio of net investment income to average net assets from 5.92% to 5.83%. Per share data and ratios for periods prior to December 31, 2001 have not been restated to reflect this change in presentation. (e) Rounds to less than $0.01 per share. (f) Total return at net asset value assuming all distributions reinvested. (g) Not annualized. (h) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (i) Annualized. 211 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia National Municipal Bond Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS A SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 10.30 $ 10.11 $ 10.28 $ 10.22 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.16 0.34 0.24 0.06 Net realized and unrealized gain (loss) on investments (0.06) 0.28 (0.16) 0.10 ------------ ------------ ------------ ------------ Total from investment operations 0.10 0.62 0.08 0.16 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.16) (0.35) (0.24) (0.06) From net realized gains (0.09) (0.08) (0.01) (0.04) ------------ ------------ ------------ ------------ Total distributions (0.25) (0.43) (0.25) (0.10) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 10.15 $ 10.30 $ 10.11 $ 10.28 Total return (d)(e) 1.00%(f) 6.22% 0.75%(f) 1.59%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 1,528 $ 1,286 $ 398 $ 67 Ratio of expenses to average net assets (g) 0.90%(h) 0.90% 0.90%(h) 0.90%(h) Ratio of net investment income to average net assets (g) 3.10%(h) 3.35% 3.49%(h) 3.85%(h) Reimbursement 1.44%(h) 1.59% 2.87%(h) 0.56%(h) Portfolio turnover rate 11%(f) 22% 12%(f) 43% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class A shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested and no initial sales charge or contingent deferred sales charge. (e) Had the Investment Advisor not reimbursed a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS B SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 10.30 $ 10.11 $ 10.28 $ 10.22 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.12 0.27 0.19 0.05 Net realized and unrealized gain (loss) on investments (0.06) 0.27 (0.16) 0.10 ------------ ------------ ------------ ------------ Total from investment operations 0.06 0.54 0.03 0.15 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.12) (0.27) (0.19) (0.05) From net realized gains (0.09) (0.08) (0.01) (0.04) ------------ ------------ ------------ ------------ Total distributions (0.21) (0.35) (0.20) (0.09) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 10.15 $ 10.30 $ 10.11 $ 10.28 Total return (d)(e) 0.63%(f) 5.44% 0.25%(f) 1.47%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 766 $ 762 $ 593 $ 72 Ratio of expenses to average net assets (g) 1.65%(h) 1.65% 1.65%(h) 1.65%(h) Ratio of net investment income to average net assets (g) 2.40%(h) 2.67% 2.77%(h) 3.10%(h) Reimbursement 1.44%(h) 1.51% 2.82%(h) 0.56%(h) Portfolio turnover rate 11%(f) 22% 12%(f) 43% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class B shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (e) Had the Investment Advisor not reimbursed a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. 212 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia National Municipal Bond Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, CLASS C SHARES 2005 2004 (a) ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 10.30 $ 10.26 ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (b) 0.14 0.27 Net realized and unrealized gain (loss) on investments (0.06) 0.12 ------------ ------------ Total from investment operations 0.08 0.39 ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.14) (0.27) From net realized gains (0.09) (0.08) ------------ ------------ Total distributions (0.23) (0.35) ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 10.15 $ 10.30 Total return (c)(d)(e) 0.80% 3.89% ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 355 $ 363 Ratio of expenses to average net assets (f)(g) 1.30% 1.30% Ratio of net investment income to average net assets (f)(g) 2.75% 2.96% Reimbursement (g) 1.44% 1.70% Waiver (g)(h) 0.35% 0.35% Portfolio turnover rate 11%(e) 22% ------------ ------------
(a) Class C shares were initially offered on October 13, 2003. Per share data and total return reflect activity from that date. (b) Per share data was calculated using average shares outstanding during the period. (c) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (d) Had the Investment Advisor/Distributor not waived or reimbursed a portion of expenses, total return would have been reduced. (e) Not annualized. (f) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (g) Annualized. (h) Amounts represent voluntary waivers of service and distribution fees.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS D SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 10.30 $ 10.11 $ 10.28 $ 10.22 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.14 0.31 0.21 0.05 Net realized and unrealized gain (loss) on investments (0.06) 0.27 (0.16) 0.10 ------------ ------------ ------------ ------------ Total from investment operations 0.08 0.58 0.05 0.15 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.14) (0.31) (0.21) (0.05) From net realized gains (0.09) (0.08) (0.01) (0.04) ------------ ------------ ------------ ------------ Total distributions (0.23) (0.39) (0.22) (0.09) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 10.15 $ 10.30 $ 10.11 $ 10.28 Total return (d)(e) 0.80%(f) 5.79% 0.47%(f) 1.51%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 259 $ 433 $ 443 $ 50 Ratio of expenses to average net assets (g) 1.30%(h) 1.30% 1.30%(h) 1.30%(h) Ratio of net investment income to average net assets (g) 2.75%(h) 3.02% 3.00%(h) 3.45%(h) Reimbursement 1.44%(h) 1.43% 2.86%(h) 0.56%(h) Waiver (i) 0.35%(h) 0.35% 0.35%(h) 0.35%(h) Portfolio turnover rate 11%(f) 22% 12%(f) 43% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class D shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (e) Had the Investment Advisor/Distributor not waived or reimbursed a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. (i) Amounts represent voluntary waivers of service and distribution fees. 213 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia National Municipal Bond Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, CLASS Z SHARES 2005 2004 2003 (a) ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 10.30 $ 10.11 $ 10.28 ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income 0.17(d) 0.38(d) 0.27(d) Net realized and unrealized gain (loss) on investments (0.06) 0.26 (0.17) ------------ ------------ ------------ Total from investment operations 0.11 0.64 0.10 ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.17) (0.37) (0.26) From net realized gains (0.09) (0.08) (0.01) ------------ ------------ ------------ Total distributions (0.26) (0.45) (0.27) ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 10.15 $ 10.30 $ 10.11 Total return (f)(g) 1.12%(h) 6.47% 1.00%(h) ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 8,044 $ 11,967 $ 14,349 Ratio of expenses to average net assets (i) 0.65%(j) 0.65% 0.65%(j) Ratio of net investment income to average net assets (i) 3.39%(j) 3.68% 3.86%(j) Reimbursement 1.44%(j) 1.40% 1.90%(j) Portfolio turnover rate 11%(h) 22% 12%(h) ------------ ------------ ------------
YEAR ENDED DECEMBER 31, ------------------------------------------------------------------------ 2002 (b) 2001 2000 1999(c) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 9.77 $ 9.82 $ 9.28 $ 10.00 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income 0.41(d) 0.44(e) 0.44 0.34 Net realized and unrealized gain (loss) on investments 0.55 (0.03)(e) 0.54 (0.72) ------------ ------------ ------------ ------------ Total from investment operations 0.96 0.41 0.98 (0.38) ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.41) (0.44) (0.44) (0.34) From net realized gains (0.04) (0.02) -- -- ------------ ------------ ------------ ------------ Total distributions (0.45) (0.46) (0.44) (0.34) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 10.28 $ 9.77 $ 9.82 $ 9.28 Total return (f)(g) 10.04% 4.16% 10.87% (3.93)%(h) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 16,470 $ 13,769 $ 10,898 $ 10,135 Ratio of expenses to average net assets (i) 0.65% 0.65% 0.65% 0.65%(j) Ratio of net investment income to average net assets (i) 4.10% 4.44%(e) 4.68% 4.21%(j) Reimbursement 0.50% 0.66% 0.64% 1.07%(j) Portfolio turnover rate 43% 20% 21% 12%(h) ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) On November 1, 2002, the existing Fund shares were renamed Class Z shares. (c) The Fund commenced investment operations on February 10, 1999. Per share data, total return and portfolio turnover rate reflect activity from that date. (d) Per share data was calculated using average shares outstanding during the period. (e) Effective January 1, 2001, the Fund adopted the provisions of the AICPA Audit and Accounting Guide for Investment Companies and began amortizing premium and accreting discount on all debt securities. The effect of this change for the year ended December 31, 2001 was to decrease the ratio of net investment income to average net assets from 4.47% to 4.44%. The impact to net investment income and net realized and unrealized loss per share was less than $0.01. Per share data and ratios for periods prior to December 31, 2001 have not been restated to reflect this change in presentation. (f) Total return at net asset value assuming all distributions reinvested. (g) Had the Investment Advisor not reimbursed a portion of expenses, total return would have been reduced. (h) Not annualized. (i) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (j) Annualized. 214 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Oregon Municipal Bond Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS A SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 12.45 $ 12.25 $ 12.50 $ 12.52 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.23 0.46 0.29 0.08 Net realized and unrealized gain (loss) on investments (0.04) 0.34 (0.22) 0.07 ------------ ------------ ------------ ------------ Total from investment operations 0.19 0.80 0.07 0.15 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.22) (0.46) (0.31) (0.08) From net realized gains (0.04) (0.14) (0.01) (0.09) ------------ ------------ ------------ ------------ Total distributions (0.26) (0.60) (0.32) (0.17) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 12.38 $ 12.45 $ 12.25 $ 12.50 Total return (d) 1.56%(e) 6.68% 0.56%(e) 1.19%(e) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 4,000 $ 3,680 $ 2,138 $ 477 Ratio of expenses to average net assets (f) 0.91%(g) 0.92% 1.16%(g) 0.92%(g) Ratio of net investment income to average net assets (f) 3.70%(g) 3.73% 3.52%(g) 4.11%(g) Portfolio turnover rate 3%(e) 11% 10%(e) 21% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class A shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested and no initial sales charge or contingent deferred sales charge. (e) Not annualized. (f) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (g) Annualized.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS B SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 12.45 $ 12.25 $ 12.50 $ 12.52 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.18 0.37 0.24 0.06 Net realized and unrealized gain (loss) on investments (0.04) 0.34 (0.23) 0.08 ------------ ------------ ------------ ------------ Total from investment operations 0.14 0.71 0.01 0.14 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.17) (0.37) (0.25) (0.07) From net realized gains (0.04) (0.14) (0.01) (0.09) ------------ ------------ ------------ ------------ Total distributions (0.21) (0.51) (0.26) (0.16) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 12.38 $ 12.45 $ 12.25 $ 12.50 Total return (d) 1.17%(e) 5.87% 0.05%(e) 1.10%(e) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 1,246 $ 1,190 $ 999 $ 373 Ratio of expenses to average net assets (f) 1.66%(g) 1.68% 1.86%(g) 1.67%(g) Ratio of net investment income to average net assets (f) 2.96%(g) 2.97% 2.83%(g) 3.36%(g) Portfolio turnover rate 3%(e) 11% 10%(e) 21% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class B shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (e) Not annualized. (f) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (g) Annualized. 215 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Oregon Municipal Bond Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, CLASS C SHARES 2005 2004 (a) ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 12.45 $ 12.42 ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (b) 0.20 0.36 Net realized and unrealized gain (loss) on investments (0.03) 0.18 ------------ ------------ Total from investment operations 0.17 0.54 ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.20) (0.37) From net realized gains (0.04) (0.14) ------------ ------------ Total distributions (0.24) (0.51) ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 12.38 $ 12.45 Total return (c)(d)(e) 1.37% 4.41% ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 402 $ 278 Ratio of expenses to average net assets (f)(g) 1.31% 1.30% Ratio of net investment income to average net assets (f)(g) 3.28% 3.28% Waiver (g)(h) 0.35% 0.35% Portfolio turnover rate 3%(e) 11% ------------ ------------
(a) Class C shares were initially offered on October 13, 2003. Per share data and total return reflect activity from that date. (b) Per share data was calculated using average shares outstanding during the period. (c) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (d) Had the Distributor not waived a portion of expenses, total return would have been reduced. (e) Not annualized. (f) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (g) Annualized. (h) Amount represents voluntary waivers of service and distribution fees.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS D SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 12.45 $ 12.25 $ 12.50 $ 12.52 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.20 0.41 0.27 0.07 Net realized and unrealized gain (loss) on investments (0.03) 0.34 (0.23) 0.07 ------------ ------------ ------------ ------------ Total from investment operations 0.17 0.75 0.04 0.14 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.20) (0.41) (0.28) (0.07) From net realized gains (0.04) (0.14) (0.01) (0.09) ------------ ------------ ------------ ------------ Total distributions (0.24) (0.55) (0.29) (0.16) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 12.38 $ 12.45 $ 12.25 $ 12.50 Total return (d)(e) 1.35%(f) 6.25% 0.32%(f) 1.14%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 781 $ 790 $ 700 $ 488 Ratio of expenses to average net assets (g) 1.31%(h) 1.33% 1.43%(h) 1.32%(h) Ratio of net investment income to average net assets (g) 3.31%(h) 3.34% 3.30%(h) 3.71%(h) Waiver (i) 0.35%(h) 0.35% 0.35%(h) 0.35%(h) Portfolio turnover rate 3%(f) 11% 10%(f) 21% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class D shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (e) Had the Distributor not waived a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. (i) Amounts represent voluntary waivers of service and distribution fees. 216 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Oregon Municipal Bond Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, CLASS Z SHARES 2005 2004 2003 (a) ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 12.45 $ 12.25 $ 12.50 ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income 0.24(c) 0.50(c) 0.34(c) Net realized and unrealized gain (loss) on investments (0.03) 0.34 (0.23) ------------ ------------ ------------ Total from investment operations 0.21 0.84 0.11 ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.24) (0.50) (0.35) From net realized gains (0.04) (0.14) (0.01) ------------ ------------ ------------ Total distributions (0.28) (0.64) (0.36) ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 12.38 $ 12.45 $ 12.25 Total return (e) 1.68%(f) 6.97% 0.83%(f) ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 419,286 $ 434,509 $ 485,427 Ratio of expenses to average net assets (g) 0.66%(h) 0.65% 0.68%(h) Ratio of net investment income to average net assets (g) 3.96%(h) 4.03% 4.13%(h) Portfolio turnover rate 3%(f) 11% 10%(f) ------------ ------------ ------------
YEAR ENDED DECEMBER 31, ------------------------------------------------------------------------ 2002 (b) 2001 2000 1999 ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 12.08 $ 12.13 $ 11.56 $ 12.46 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income 0.55(c) 0.57(d) 0.58 0.56 Net realized and unrealized gain (loss) on investments 0.54 (0.02)(d) 0.58 (0.88) ------------ ------------ ------------ ------------ Total from investment operations 1.09 0.55 1.16 (0.32) ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.55) (0.57) (0.58) (0.56) From net realized gains (0.12) (0.03) (0.01) (0.02) ------------ ------------ ------------ ------------ Total distributions (0.67) (0.60) (0.59) (0.58) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 12.50 $ 12.08 $ 12.13 $ 11.56 Total return (e) 9.24% 4.55% 10.28% (2.65)% ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 508,865 $ 491,638 $ 436,544 $ 409,919 Ratio of expenses to average net assets (g) 0.58% 0.57% 0.58% 0.57% Ratio of net investment income to average net assets (g) 4.45% 4.64%(d) 4.92% 4.64% Portfolio turnover rate 21% 14% 22% 28% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) On November 1, 2002, the existing Fund shares were renamed Class Z shares. (c) Per share data was calculated using average shares outstanding during the period. (d) Effective January 1, 2001, the Fund adopted the provisions of the AICPA Audit and Accounting Guide for Investment Companies and began amortizing premium and accreting discount on all debt securities. The effect of this change for the year ended December 31, 2001 was less than $0.01 to net investment income and net realized and unrealized loss per share and less than 0.01% to the ratio of net investment income to average net assets. Per share data and ratios for the periods prior to December 31, 2001 have not been restated to reflect this change in presentation. (e) Total return at net asset value assuming all distributions reinvested. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. 217 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia High Yield Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS A SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 8.69 $ 8.49 $ 8.37 $ 8.17 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.24 0.50 0.33 0.09 Net realized and unrealized gain on investments 0.14 0.24 0.15 0.20 ------------ ------------ ------------ ------------ Total from investment operations 0.38 0.74 0.48 0.29 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.26) (0.54) (0.36) (0.09) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 8.81 $ 8.69 $ 8.49 $ 8.37 Total return (d) 4.42%(e) 8.90% 5.81%(e) 3.50%(e) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 350,819 $ 335,841 $ 193,267 $ 33,992 Ratio of expenses to average net assets (f) 0.97%(g) 1.01% 1.07%(g) 1.15%(g) Ratio of net investment income to average net assets (f) 5.52%(g) 5.74% 5.82%(g) 6.46%(g) Portfolio turnover rate 22%(e) 41% 38%(e) 42% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class A shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested and no initial sales charge or contingent deferred sales charge. (e) Not annualized. (f) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (g) Annualized.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS B SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 8.69 $ 8.49 $ 8.37 $ 8.17 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.21 0.43 0.28 0.07 Net realized and unrealized gain on investments 0.14 0.24 0.15 0.20 ------------ ------------ ------------ ------------ Total from investment operations 0.35 0.67 0.43 0.27 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.23) (0.47) (0.31) (0.07) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 8.81 $ 8.69 $ 8.49 $ 8.37 Total return (d) 4.04%(e) 8.07% 5.20%(e) 3.33%(e) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 101,165 $ 102,038 $ 89,950 $ 16,701 Ratio of expenses to average net assets (f) 1.72%(g) 1.77% 1.94%(g) 1.90%(g) Ratio of net investment income to average net assets (f) 4.77%(g) 4.97% 4.93%(g) 5.71%(g) Portfolio turnover rate 22%(e) 41% 38%(e) 42% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class B shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (e) Not annualized. (f) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (g) Annualized. 218 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia High Yield Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, CLASS C SHARES 2005 2004 (a) ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 8.69 $ 8.64 ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (b) 0.21 0.39 Net realized and unrealized gain on investments 0.14 0.09 ------------ ------------ Total from investment operations 0.35 0.48 ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.23) (0.43) ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 8.81 $ 8.69 Total return (c)(d)(e) 4.12% 5.65% ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 22,754 $ 20,126 Ratio of expenses to average net assets (f)(g) 1.57% 1.61% Ratio of net investment income to average net assets (f)(g) 4.92% 5.03% Waiver (g)(h) 0.15% 0.15% Portfolio turnover rate 22%(e) 41% ------------ ------------
(a) Class C shares were initially offered on October 13, 2003. Per share data and total return reflect activity from that date. (b) Per share data was calculated using average shares outstanding during the period. (c) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (d) Had the Distributor not waived a portion of expenses, total return would have been reduced. (e) Not annualized. (f) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (g) Annualized. (h) Amounts represent voluntary waivers of service and distribution fees.
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, DECEMBER 31, CLASS D SHARES 2005 2004 2003 (a) 2002 (b) ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 8.69 $ 8.49 $ 8.37 $ 8.17 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income (c) 0.22 0.44 0.29 0.07 Net realized and unrealized gain on investments 0.13 0.24 0.15 0.20 ------------ ------------ ------------ ------------ Total from investment operations 0.35 0.68 0.44 0.27 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.23) (0.48) (0.32) (0.07) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 8.81 $ 8.69 $ 8.49 $ 8.37 Total return (d)(e) 4.12%(f) 8.23% 5.35%(f) 3.35%(f) ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 73,770 $ 86,854 $ 103,559 $ 18,035 Ratio of expenses to average net assets (g) 1.57%(h) 1.62% 1.73%(h) 1.75%(h) Ratio of net investment income to average net assets (g) 4.92%(h) 5.12% 5.12%(h) 5.86%(h) Waiver (i) 0.15%(h) 0.15% 0.15%(h) 0.15%(h) Portfolio turnover rate 22%(f) 41% 38%(f) 42% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) Class D shares were initially offered on November 1, 2002. Per share data and total return reflect activity from that date. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested and no contingent deferred sales charge. (e) Had the Distributor not waived a portion of expenses, total return would have been reduced. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. (i) Amounts represent voluntary waivers of service and distribution fees. 219 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia High Yield Fund FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, CLASS Z SHARES 2005 2004 2003 (a) ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 8.69 $ 8.49 $ 8.37 ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income 0.25(c) 0.52(c) 0.35(c) Net realized and unrealized gain (loss) on investments 0.14 0.24 0.15 ------------ ------------ ------------ Total from investment operations 0.39 0.76 0.50 ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.27) (0.56) (0.38) From net realized gains -- -- -- ------------ ------------ ------------ Total distributions (0.27) (0.56) (0.38) ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 8.81 $ 8.69 $ 8.49 Total return (e) 4.54%(f) 9.16% 6.04%(f) ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 1,221,700 $ 1,186,454 $ 1,197,340 Ratio of expenses to average net assets (g) 0.72%(h) 0.77% 0.82%(h) Ratio of net investment income to average net assets (g) 5.77%(h) 5.97% 6.19%(h) Portfolio turnover rate 22%(f) 41% 38%(f) ------------ ------------ ------------
YEAR ENDED DECEMBER 31, ------------------------------------------------------------------------ 2002 (b) 2001 2000 1999 ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 8.87 $ 8.98 $ 9.32 $ 9.84 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income 0.57(c) 0.67(d) 0.75 0.74 Net realized and unrealized gain (loss) on investments (0.48) (0.09)(d) (0.34) (0.51) ------------ ------------ ------------ ------------ Total from investment operations 0.09 0.58 0.41 0.23 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.59) (0.69) (0.75) (0.74) From net realized gains -- -- -- (0.01) ------------ ------------ ------------ ------------ Total distributions (0.59) (0.69) (0.75) (0.75) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 8.37 $ 8.87 $ 8.98 $ 9.32 Total return (e) 1.17% 6.63% 4.61% 2.38% ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 702,785 $ 238,994 $ 97,575 $ 71,678 Ratio of expenses to average net assets (g) 0.77% 0.85% 0.93% 0.91% Ratio of net investment income to average net assets (g) 6.84% 7.47%(d) 8.22% 7.71% Portfolio turnover rate 42% 69% 50% 49% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) On November 1, 2002, the existing Fund shares were renamed Class Z shares. (c) Per share data was calculated using average shares outstanding during the period. (d) Effective January 1, 2001, the Fund adopted the provisions of the AICPA Audit and Accounting Guide for Investment Companies and began amortizing premium and accreting discount on all debt securities. The effect of this change for the year ended December 31, 2001 was to decrease net investment income per share by $0.02, decrease net realized and unrealized loss per share by $0.02 and decrease the ratio of net investment income to average net assets from 7.64% to 7.47%. Per share data and ratios for periods prior to December 31, 2001 have not been restated to reflect this change in presentation. (e) Total return at net asset value assuming all distributions reinvested. (f) Not annualized. (g) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (h) Annualized. 220 FINANCIAL HIGHLIGHTS ___________________________________________________________ Columbia Daily Income Company FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
(UNAUDITED) SIX MONTHS ENDED YEAR ENDED PERIOD ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, CLASS Z SHARES 2005 2004 2003 (a) ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 1.000 $ 1.000 $ 1.000 ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income 0.006(c) 0.004(c) 0.004(c) ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.006) (0.004) (0.004) ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 1.000 $ 1.000 $ 1.000 Total return (d) 0.59%(e) 0.36% 0.40%(e) ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 546,209 $ 661,114 $ 898,164 Ratio of expenses to average net assets (f) 0.80%(g) 0.71% 0.69%(g) Ratio of net investment income to average net assets (f) 1.23%(g) 0.38% 0.53%(g) ------------ ------------ ------------
YEAR ENDED DECEMBER 31, ------------------------------------------------------------------------ 2002 (b) 2001 2000 1999 ------------ ------------ ------------ ------------ NET ASSET VALUE, BEGINNING OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 ------------ ------------ ------------ ------------ INCOME FROM INVESTMENT OPERATIONS: Net investment income 0.012(c) 0.036 0.058 0.046 ------------ ------------ ------------ ------------ LESS DISTRIBUTIONS: From net investment income (0.012) (0.036) (0.058) (0.046) ------------ ------------ ------------ ------------ NET ASSET VALUE, END OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 Total return (d) 1.17% 3.70% 6.00% 4.71% ------------ ------------ ------------ ------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 1,136,075 $ 1,253,535 $ 1,198,151 $ 1,165,289 Ratio of expenses to average net assets (f) 0.60% 0.60% 0.60% 0.64% Ratio of net investment income to average net assets (f) 1.16% 3.61% 5.82% 4.61% ------------ ------------ ------------ ------------
(a) The Fund changed its fiscal year end from December 31 to August 31. (b) On November 1, 2002, the existing Fund shares were renamed Class Z shares. (c) Per share data was calculated using average shares outstanding during the period. (d) Total return at net asset value assuming all distributions reinvested. (e) Not annualized. (f) The benefits derived from custody credits and directed brokerage arrangements, if applicable, had an impact of less than 0.01%. (g) Annualized. 221 This page intentionally left blank. COLUMBIA FUNDS _________________________________________________________________ Columbia Funds ---------------------------------------- LARGE GROWTH Columbia Growth Stock Columbia Large Cap Growth Columbia Tax-Managed Growth Columbia Tax-Managed Growth II* Columbia Young Investor ---------------------------------------- LARGE VALUE Columbia Disciplined Value Columbia Growth & Income Columbia Large Cap Core Columbia Tax-Managed Value* ---------------------------------------- MIDCAP GROWTH Columbia Acorn Select Columbia Mid Cap Growth Columbia Tax-Managed Aggressive Growth ---------------------------------------- MIDCAP VALUE Columbia Dividend Income Columbia Mid Cap Value* Columbia Strategic Investor ---------------------------------------- SMALL GROWTH Columbia Acorn Columbia Acorn USA Columbia Small Company Equity ---------------------------------------- SMALL VALUE Columbia Small Cap Columbia Small Cap Value ---------------------------------------- BALANCED Columbia Asset Allocation Columbia Balanced Columbia Liberty Fund ---------------------------------------- SPECIALTY Columbia Real Estate Equity Columbia Technology Columbia Utilities ---------------------------------------- TAXABLE FIXED-INCOME Columbia Corporate Bond Columbia Federal Securities Columbia Fixed Income Securities Columbia High Yield Columbia High Yield Opportunities Columbia Income* Columbia Intermediate Bond Columbia Intermediate Government Income* Columbia Quality Plus Bond Columbia Short Term Bond* Columbia Strategic Income ---------------------------------------- TAX EXEMPT Columbia High Yield Municipal Columbia Intermediate Tax-Exempt Bond Columbia Managed Municipals* Columbia National Municipal Bond** Columbia Tax-Exempt Columbia Tax-Exempt Insured 223 ________________________________________________________________________________ Columbia Funds
-------------------------------------------------- SINGLE STATE TAX EXEMPT Columbia California Tax-Exempt Columbia Connecticut Intermediate Municipal Bond Columbia Connecticut Tax-Exempt Columbia Florida Intermediate Municipal Bond* Columbia Massachusetts Intermediate Municipal Bond Columbia Massachusetts Tax-Exempt Columbia New Jersey Intermediate Municipal Bond Columbia New York Intermediate Municipal Bond Columbia New York Tax-Exempt Columbia Oregon Municipal Bond Columbia Pennsylvania Intermediate Municipal Bond* Columbia Rhode Island Intermediate Municipal Bond -------------------------------------------------- MONEY MARKET Columbia Money Market Columbia Municipal Money Market -------------------------------------------------- INTERNATIONAL/GLOBAL Columbia Acorn International Columbia Acorn International Select Columbia Global Equity Columbia International Stock Columbia Newport Greater China Columbia Newport Tiger* -------------------------------------------------- INDEX Columbia Large Company Index* Columbia Small Company Index* Columbia U.S. Treasury Index*
* The fund will be closed to new investments after the close of business on April 29, 2005. The fund's trustees have approved the merger, which is scheduled to occur during September and October, pending shareholder approval ** The fund will be closed to new investments after the close of business on April 29, 2005. The fund's trustees have approved the liquidation, which is scheduled to occur during September, pending shareholder approval Please consider the investment objectives, risks, charges and expenses of a mutual fund carefully before investing. Contact us at 800-345-6611 for a prospectus which contains this and other important information about the fund. Read it carefully before you invest. For complete product information on any Columbia fund, visit our website at www.columbiafunds.com. Columbia Management Group and Columbia Management refer collectively to the various investment advisory and subsidiaries of Columbia Management Group, including Columbia Management Advisors, Inc., the registered investment advisor, and Columbia Funds Distributor, Inc. 224 IMPORTANT INFORMATION ABOUT THIS REPORT ________________________________________ Columbia Funds TRANSFER AGENT Columbia Funds Services, Inc. P.O. Box 8081 Boston MA 02266-8081 800.345.6611 DISTRIBUTOR Columbia Funds Distributor, Inc. One Financial Center Boston MA 02111 INVESTMENT ADVISOR Columbia Management Advisors, Inc. 100 Federal Street Boston MA 02110 INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM PricewaterhouseCoopers LLP 125 High Street Boston MA 02110 The funds mail one shareholder report to each shareholder address. If you would like more than one report, please call shareholder services at 800-345-6611 and additional reports will be sent to you. This report has been prepared for shareholders of Columbia Funds. This report may also be used as sales literature when preceded or accompanied by the current prospectus which provides details of sales charges, investment objectives and operating policies of the funds and with the most recent copy of the Columbia Funds Performance Update. A description of the policies and procedures that the fund uses to determine how to vote proxies and a copy of the fund's voting record are available (i) at www.columbiamanagement.com; (ii) on the Securities and Exchange Commission's website at www.sec.gov, and (iii) without charge, upon request, by calling 800-368-0346. Information regarding how the fund voted proxies relating to portfolio securities during the 12-month period ended June 30, 2004 is available from the SEC's website. Information regarding how the fund voted proxies relating to portfolio securities is also available from the fund's website. The fund files a complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund's Form N-Q is available on the SEC's website at www.sec.gov and may be reviewed and copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330. 225 [Photo of eDelivery] Help your fund reduce printing and postage costs! Elect to get your shareholder reports by electronic delivery. With Columbia's eDelivery program, you receive an e-mail message when your shareholder report becomes available online. If your fund account is registered with Columbia Funds, you can sign up quickly and easily on our website at www.columbiafunds.com. Please note -- if you own your fund shares through a financial institution, contact the institution to see if it offers electronic delivery. If you own your fund shares through a retirement plan, electronic delivery may not be available to you. Columbia Funds SEMIANNUAL REPORT, FEBRUARY 28, 2005 PRSRT STD U.S. POSTAGE PAID HOLLISTON, MA PERMIT NO. 20 COLUMBIA MANAGEMENT(R) (C)2005 COLUMBIA FUNDS DISTRIBUTOR, INC. ONE FINANCIAL CENTER, BOSTON, MA 02111-2621 800.345.6611 WWW.COLUMBIAFUNDS.COM COL-03/726U-0205 (04/05) 5130 ITEM 2. CODE OF ETHICS. Not applicable at this time. ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT. Not applicable at this time. ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES. Not applicable at this time. ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS. Not applicable. ITEM 6. SCHEDULE OF INVESTMENTS The registrant's "Schedule I - Investments in securities of unaffiliated issuers" (as set forth in 17 CFR 210.12-12) is included in Item 1 of this Form N-CSR. 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. PURCHASES 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. There have not been any material changes to the procedures by which shareholders may recommend nominees to the registrant's board of directors, since those procedures were last disclosed in response to the requirements of Item 7(d)(2)(ii)(G) of Schedule 14A or this Item. ITEM 11. CONTROLS AND PROCEDURES. (a) The registrant's principal executive officer and principal financial officers, based on their evaluation of the registrant's disclosure controls and procedures as of a date within 90 days of the filing of this report, have concluded that such controls and procedures are adequately designed to ensure that information required to be disclosed by the registrant in Form N-CSR is accumulated and communicated to the registrant's management, including the principal executive officer and principal financial officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. (b) There were no changes in the registrant's internal control over financial reporting that occurred during the registrant's 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. ITEM 12. EXHIBITS. (a)(1) Code of ethics required to be disclosed under Item 2 of Form N-CSR: Not applicable at this time. (a)(2) Certifications pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a-2(a)) attached hereto as Exhibit 99.CERT. (a)(3) Not applicable. (b) Certification pursuant to Rule 30a-2(b) under the Investment Company Act of 1940 (17 CFR 270.30a-2(b)) attached hereto as Exhibit 99.906CERT. 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) Columbia Mid Cap Growth Fund, Inc. -------------------------------------------------------------------- By (Signature and Title) /S/ Christopher L. Wilson -------------------------------------------------------- Christopher L. Wilson, President Date April 27, 2005 ---------------------------------------------------------------------------- Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By (Signature and Title) /S/ Christopher L. Wilson -------------------------------------------------------- Christopher L. Wilson, President Date April 27, 2005 ---------------------------------------------------------------------------- By (Signature and Title) /S/ J. Kevin Connaughton -------------------------------------------------------- J. Kevin Connaughton, Treasurer Date April 27, 2005 ----------------------------------------------------------------------------