N-CSR/A

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:	811-06153
	Integrity Managed Portfolios
	(Exact name of registrant as specified in charter)
Address of Registrant:	1 Main Street North
	Minot, ND 58703
Name and Address of Agent for Service:	Brent Wheeler, Mutual Fund Chief Compliance Officer
	Kevin Flagstad, Investment Adviser Chief Compliance Officer
	1 Main Street North
	Minot, ND 58703

Registrant's telephone number, including area code: (701) 852-5292

Date of fiscal year end:	July 31
Date of reporting period:	July 31, 2008

Item 1—Reports to Shareholders

Dear Shareholder:

Enclosed is the report of the operations for the Kansas Municipal Fund (the "Fund") for the year ended July 31, 2008. The Fund's portfolio and related financial statements are presented within for your review.

As we end the year, what one might have thought was an uneventful year was much the opposite.

First, interest rates spiked higher early in June as Federal Reserve Chairman Ben Bernanke voiced concern about inflation and the slumping dollar. However, a string of weak economic reports in the last part of June (consumer confidence plunged to its lowest level since 1992) along with more losses and downgrades in the banking sector, reduced corporate earnings expectations as well as higher energy prices have encouraged market participants to dump stocks in favor of low-risk government bonds, sending the 10-year treasury to 3.95%

Second, while the market likes to talk about light at the end of the tunnel, unfortunately in these days of financial turmoil we can never be sure whether it is light from the other side or another freight train coming. Most recently, Fannie Mae and Freddie Mac who own or guarantee nearly half of the $12 trillion mortgage market have seen their company stocks fall 75-80% year-to-date, as the worst housing downturn since the Great Depression impacted expected solvency levels.

Municipals on the other hand didn't fare any better as a number of the secondary insurers saw significant downgrades of their ratings, the collapse of major financial institution Bear Stearns and the exit of UBS from the municipal bond market.

The secondary insurers of municipal debt are in turmoil as a number of the insurance companies are in dire straits. Many bond professionals and investors, who in the past treated all insured bonds equal from a credit perspective, now understand the importance of the underlying credit, the purpose of the debt issued, and its commitment to pay. Currently there are three insurers of municipal debt that have AAA ratings from all three rating agencies and two of those three insurers are on Credit Watch for possible downgrade.

These events have created great uncertainty and with that, opportunity. It is now a buyers market as high quality municipals are yielding in many instances, yields higher than taxable treasuries of similar maturities. Clearly there will be price rallies and price sell offs in the months ahead, but the underlying tone for tax-free municipals is bullish.

The Kansas Municipal Fund began the period at $10.54 and ended the period at $10.44 for a total return of 2.90%*. This compares to the Lehman Brothers Municipal Bond Index return of 2.84%.

The Fund's yearly overall performance can be attributed to its defensive portfolio, with an average maturity of 15.5 years and an average maturity to the first call date of 3.5 years. That, along with an average portfolio coupon of 5.38% helps relative performance in volatile environments.

An important part of the Fund's strategy includes searching the primary and secondary markets for high quality, double tax-exempt issues. Some purchases made throughout the year include: Harvey County Schools, 5.00% coupon, due 2025; Sedgwick County Schools, 5.00% coupon, due 2028; University of Kansas Athletic Facility, 5.00% coupon, due 2033; and Wyandotte County General Obligation, 5.00% coupon, due 2027.

Portfolio quality at year-end was as follows: AAA 35%, AA 34%, A 28%, BBB 2% and NR 1%. 

Income exempt from federal and Kansas state income taxes with preservation of capital remain the primary objectives of the Fund.

If you would like more frequent updates, visit the Fund's website at www.integrityfunds.com for daily prices along with pertinent Fund information.

Sincerely,

Monte Avery

Senior Portfolio Manager

The views expressed are those of Monte Avery, Senior Portfolio Manager with Integrity Mutual Funds, Inc. ("Integrity Mutual Funds"). The views are subject to change at any time in response to changing circumstances in the market and are not intended to predict or guarantee the future performance of any individual security, market sector, the markets generally, or any Integrity Mutual Fund.

*Performance does not include applicable front-end or contingent deferred sales charges ("CDSCs"), which would have reduced the performance.

Performance data quoted above is historical. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. The principal value and investment return of an investment will fluctuate so that your shares, when redeemed, may be worth more or less than the original cost. You can obtain performance data current to the most recent month end (available within seven business days of the most recent month end) by calling 800-276-1262.

You should consider the Fund's investment objectives, risks, charges, and expenses carefully before investing. For this and other important information, please obtain a Fund prospectus at no cost from your financial adviser and read it carefully before investing.

Bond prices and, therefore, the value of bond funds decline as interest rates rise. Because the Fund invests in securities of a single state, the Fund is more susceptible to factors adversely impacting the respective state securities more so than a municipal bond fund that does not concentrate its securities in a single state.

July 31, 2008 (Unaudited)

PROXY VOTING OF FUND PORTFOLIO SECURITIES

A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to securities held in the Fund's portfolio is available, without charge and upon request, by calling 800-276-1262. A report on Form N-PX of how the Fund voted any such proxies during the most recent twelve-month period ended June 30 is available through the Fund's website at www.integrityfunds.com. The information is also available from the Electronic Data Gathering, Analysis, and Retrieval ("EDGAR") database on the website of the Securities and Exchange Commission ("SEC") at www.sec.gov.

QUARTERLY PORTFOLIO SCHEDULE

Within 60 days of the end of its second and fourth fiscal quarters, the Fund provides a complete schedule of portfolio holdings in its semi-annual and annual reports on the Form N-CSR(S). These reports are filed electronically with the SEC and are delivered to the shareholders of the Fund. The Fund also files its 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 Forms N-Q and N-CSR(S) are available on the SEC's website at www.sec.gov. The Fund's Forms N-Q and N-CSR(S) 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 202-942-8090. You may also access this information from the Fund's website at www.integrityfunds.com.

SHAREHOLDER INQUIRIES AND MAILINGS

All inquiries regarding the Fund should be directed to:

Integrity Funds Distributor, Inc.

1 Main Street North

Minot, ND 58703

Phone: 800-276-1262

All inquiries regarding account information should be directed to:

Integrity Fund Services, Inc.

P.O. Box 759

Minot, ND 58702

Phone: 800-601-5593

To reduce expenses, the Fund may only mail one copy of its prospectus and each annual and semi-annual report to those addresses shared by two or more accounts. If you wish to receive individual copies of these documents, please call Integrity Funds Distributor, Inc. ("Integrity Funds Distributor") at 800-276-1262 (or contact your financial institution). Individual copies will be sent thirty days after receiving your request.

Terms & Definitions July 31, 2008 (Unaudited)

Appreciation

Increase in the value of an asset

Average Annual Total Return

A standardized measurement of the return (yield and appreciation) earned by a fund on an annual basis assuming all distributions are reinvested

Coupon Rate or Face Rate

Rate of interest payable annually based on the face amount of the bond; expressed as a percentage

Depreciation

Decrease in the value of an asset

Lehman Brothers Municipal Bond Index

An unmanaged list of long-term, fixed-rate, investment-grade, tax-exempt bonds representative of the municipal bond market; the index does not take into account brokerage commissions or other costs, may include bonds different from those in the Fund, and may pose different risks than the Fund

Market Value

Actual (or estimated) price at which a bond trades in the marketplace

Maturity

A measure of the term or life of a bond in years; when a bond "matures", the issuer repays the principal

Net Asset Value

The value of all of a fund's assets, minus any liabilities, divided by the number of outstanding shares, not including any initial sales charge

Quality Ratings

A designation assigned by independent rating companies to give a relative indication of a bond's creditworthiness; "AAA," "AA," "A," and "BBB" indicate investment grade securities. Ratings can range from a high of "AAA" to a low of "D".

Total Return

Measures both the net investment income and any realized and unrealized appreciation or depreciation of the underlying investments in a fund's portfolio for the period, assuming the reinvestment of all dividends; represents the aggregate percentage or dollar value change over the period

July 31, 2008 (Unaudited)

COMPOSITION

Portfolio Quality Ratings

(Based on total long-term investments)

AAA	34.6%
AA	34.0%
A	28.2%
BBB	2.2%
NR	1.0%

Quality ratings reflect the financial strength of the issuer. They are assigned by independent ratings services such as Moody's Investors Services ("Moody's") and Standard & Poor's Ratings Group ("S&P"). Non-rated bonds have been determined to be of appropriate quality for the portfolio by Integrity Money Management, Inc. ("Integrity Money Management"), the Fund's investment adviser.

These percentages are subject to change.

Portfolio Market Sectors

(As a percentage of Net Assets)

HC—Health Care	26.1%
S—School	20.2%
H—Housing	15.3%
O—Other	10.8%
W/S—Water/Sewer	9.1%
T—Transportation	8.7%
G—Government	5.6%
U—Utilities	4.2%

Market sectors are breakdowns of the Fund's portfolio holdings into specific investment classes.

These percentages are subject to change.

July 31, 2008 (Unaudited)

DISCLOSURE OF FUND EXPENSES

The example below is intended to describe the fees and expenses borne by shareholders and the impact of those costs on your investment.

EXAMPLE

As a shareholder of the Fund, you incur two types of costs:

•	transaction costs:	sales charges (loads), redemption fees, and exchange fees
•	ongoing costs:	management fees, distribution (12b-1) fees, and other Fund expenses

This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period from January 31, 2008 to July 31, 2008.

The example illustrates the Fund's costs in two ways:

Actual expenses

The section in the table under the heading "Actual" provides information about actual account values and actual expenses. You may use the information in these columns together with the amount you invested to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an account value of $8,600 divided by $1,000 equals 8.6), then multiply the result by the number in the column entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period.

Hypothetical example for comparison purposes

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

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees, or exchange fees. Therefore, the section in the table under the heading "Hypothetical (5% return before expenses)" is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

	Beginning Account Value 01/31/08	Ending Account Value 07/31/08		Expenses Paid During Period*
Actual	$1,000.00	$	990.02	$5.32
Hypothetical (5% return before expenses)	$1,000.00	$	1,019.51	$5.40

*Expenses are equal to the annualized expense ratio of 1.07%, multiplied by the average account value over the period, multiplied by 180/360 days. The Fund's ending account value on the first line in the table is based on its actual total return of (1.00%) for the six-month period of January 31, 2008 to July 31, 2008.

July 31, 2008 (Unaudited)

AVERAGE ANNUAL TOTAL RETURNS

		For periods ending July 31, 2008
Kansas Municipal Fund		1 year	3 year	5 year	10 year	Since Inception (November 15, 1990)
	Without Sales Charge	2.90%	3.45%	2.44%	2.80%	4.44%
	With Sales Charge (4.25%)	(1.49%)	1.96%	1.55%	2.35%	4.18%
Lehman Brothers Municipal Bond Index		1 year	3 year	5 year	10 year	Since Inception (November 15, 1990)
		2.84%	3.22%	4.35%	4.92%	6.27%

Putting Performance into Perspective

Performance data quoted above is historical. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. The principal value and investment return of an investment will fluctuate so that your shares, when redeemed, may be worth more or less than the original cost. You can obtain performance data current to the most recent month end (available within seven business days of the most recent month end) by calling 800-276-1262.

You should consider the Fund's investment objectives, risks, charges, and expenses carefully before investing. For this and other important information, please obtain a Fund prospectus at no cost from your financial adviser and read it carefully before investing.

The table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions and redemption of Fund shares.

July 31, 2008 (Unaudited)

COMPARATIVE INDEX GRAPH

Comparison of change in value of a $10,000 investment in the Fund and the Lehman Brothers Municipal Bond Index

	Kansas Municipal Fund without Sales Charge		Kansas Municipal Fund with Maximum Sales Charge		Lehman Brothers Municipal Bond Index
7/31/98	$	10,000	$	9,574	$	10,000
1999	$	10,344	$	9,904	$	10,288
2000	$	10,519	$	10,071	$	10,732
2001	$	11,374	$	10,890	$	11,815
2002	$	11,770	$	11,269	$	12,608
2003	$	11,682	$	11,185	$	13,061
2004	$	11,882	$	11,376	$	13,816
2005	$	11,908	$	11,401	$	14,695
2006	$	12,430	$	11,901	$	15,071
2007	$	12,810	$	12,265	$	15,713
7/31/08	$	13,182	$	12,621	$	16,160

Putting Performance into Perspective

Performance data quoted above is historical. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. The principal value and investment return of an investment will fluctuate so that your shares, when redeemed, may be worth more or less than the original cost. You can obtain performance data current to the most recent month end (available within seven business days of the most recent month end) by calling 800-276-1262.

You should consider the Fund's investment objectives, risks, charges, and expenses carefully before investing. For this and other important information, please obtain a Fund prospectus at no cost from your financial adviser and read it carefully before investing.

The graph does not reflect the deduction of taxes that a shareholder would pay on Fund distributions and redemptions of Fund shares.

The graph comparing the Fund's performance to a benchmark index provides you with a general sense of how the Fund performed. To put this information in context, it may be helpful to understand the special differences between the two. The Lehman Brothers Municipal Bond Index is a national index representative of the national municipal bond market, whereas the Fund concentrates its investments in Kansas municipal bonds. The Fund's total return for the periods shown appears with and without sales charges and includes Fund expenses and management fees. A securities index measures the performance of a theoretical portfolio. Unlike a fund, the index is unmanaged; there are no expenses that affect the results. In addition, few investors could purchase all of the securities necessary to match the index. If they could, they would incur transaction costs and other expenses. All Fund and benchmark returns include reinvested dividends.

July 31, 2008 (Unaudited)

MANAGEMENT OF THE FUND

The Board of the Fund consists of four Trustees. These same individuals, unless otherwise noted, also serve as Directors or Trustees for all of the funds in the Integrity family of funds, the six series of Integrity Managed Portfolios, and the three series of The Integrity Funds. Three Trustees (75% of the total) have no affiliation or business connection with Integrity Money Management or any of its affiliates; these are the "Independent" Trustees. Two of the remaining three Trustees and/or Officers are "interested" by virtue of their affiliation with Integrity Money Management and/or its affiliates.

The Independent Trustees of the Fund, their term of office and length of time served, their principal occupation(s) during the past five years, the number of portfolios overseen in the Fund Complex by each Independent Trustee, and other Directorships, if any, held outside the Fund Complex, are shown below.

INDEPENDENT TRUSTEES

NAME, ADDRESS, AND AGE	POSITION(S) HELD WITH REGISTRANT	TERM AND LENGTH SERVED	NUMBER OF PORTFOLIOS OVERSEEN IN THE FUND COMPLEX(1)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS	OTHER DIRECTORSHIPS HELD OUTSIDE THE FUND COMPLEX
Jerry M. Stai 2405 11th Ave. NW Minot, ND 58703 56	Trustee	Indefinite Since January 2006	12	Faculty, Embry-Riddle University (August 2000 to September 2005); Faculty, Park University (August 2005 to December 2005); Non-Profit Specialist, Bremer Bank (since July 2005); Faculty, Minot State University (since August 2000); Director, ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., Integrity Fund of Funds, Inc., (since January 2006); Trustee, The Integrity Funds (since January 2006).	Marycrest Franciscan Development, Inc.
Orlin W. Backes 948 13th Ave. SW Minot, ND 58701 73	Trustee	Indefinite Since January 1996	12	Attorney, McGee, Hankla, Backes & Dobrovolny, P.C.; Director, South Dakota Tax-Free Fund, Inc. (April 1995 to June 2004), ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., and Integrity Fund of Funds, Inc., (since April 2005); Trustee, The Integrity Funds (since June 2003).	First Western Bank & Trust
R. James Maxson 1 N. Main St. Minot, ND 58701 60	Trustee	Indefinite Since January 1999	12	Attorney, Maxson Law Office (since November 2002); Director, South Dakota Tax-Free Fund, Inc. (January 1999 to June 2004), Integrity Fund of Funds, Inc., ND Tax-Free Fund, Inc. and Montana Tax-Free Fund, Inc. (since January 1999); and Trustee, The Integrity Funds (since June 2003).	Vincent United Methodist Foundation Minot Area Development Corporation

⁽¹⁾ The Fund Complex consists of the three incorporated funds in the Integrity family of funds, the six series of Integrity Managed Portfolios, and the three series of The Integrity Funds.

Trustees and Officers of the Fund serve until their resignation, removal, or retirement.

The Statement of Additional Information ("SAI") contains more information about the Fund's Trustees and is available without charge upon request, by calling Integrity Funds Distributor at 800-276-1262.

The Interested Trustees and Officers of the Fund, their term of office and length of time served, their principal occupation(s) during the past five years, the number of portfolios overseen in the Fund Complex by each Interested Trustee, and other Directorships, if any, held outside the Fund Complex, are shown below.

INTERESTED TRUSTEE AND OFFICER

NAME, ADDRESS, AND AGE	POSITION(S) HELD WITH REGISTRANT	TERM AND LENGTH SERVED	NUMBER OF PORTFOLIOS OVERSEEN IN THE FUND COMPLEX(1)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS	OTHER DIRECTORSHIPS HELD OUTSIDE THE FUND COMPLEX
Robert E. Walstad(2)(3) 1 N. Main St. Minot, ND 58703 63	Trustee, Chairman, Interim President	Indefinite Since January 1996	12	Director (Sept. 1987 to Feb. 2007), CEO (Sept. 2001 to Feb. 2007), Integrity Mutual Funds; Director, President, and Treasurer, (Aug. 1988 to Feb. 2007), Integrity Money Management; Director, President, and Treasurer (Aug. 1988 to Sept. 2004), ND Capital, Inc.; Director, President, and Treasurer (May 1989 to Feb. 2007), Integrity Fund Services, Inc.; Director, President, CEO, and Treasurer, (Jan. 1996 to Aug. 2003), Integrity Funds Distributor, Inc.; Director, CEO, Chairman, (Jan. 2002 to Feb. 2007) and President (Sept. 2002 to Dec. 2004), Capital Financial Services, Inc.; Director and President, (April 1994 to June 2004) South Dakota Tax-Free Fund, Inc.; President (Jan. 1996 to July 2007) and (since March 2008) Integrity Managed Portfolios, (May 2003 to July 2007) and (since March 2008) The Integrity Funds, (Jan. 1995 to July 2007) and (since March 2008) Integrity Fund of Funds, Inc., (Jan. 1989 to July 2007) and (since March 2008) ND Tax-Free Fund, Inc., (Aug. 1993 to July 2007) and (since March 2008) Montana Tax-Free Fund, Inc.; Director and Chairman Montana Tax-Free Fund, Inc. (since May 1993), Integrity Fund of Funds, Inc. (since Aug. 1994), and ND Tax Free Fund, Inc. (since Oct. 1988); Trustee, Chairman, (since January 1996) and Treasurer (January 1996 to May 2004), Integrity Managed Portfolios; Trustee and Chairman (since June 2003), The Integrity Funds.	Minot Park Board

OFFICERS

NAME, ADDRESS, AND AGE	POSITION(S) HELD WITH REGISTRANT	TERM AND LENGTH SERVED	NUMBER OF PORTFOLIOS OVERSEEN IN THE FUND COMPLEX(1)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS	OTHER DIRECTORSHIPS HELD OUTSIDE THE FUND COMPLEX
Peter A. Quist 1 N. Main St. Minot, ND 58703 74	Vice President, Secretary	Indefinite Since January 1996	3	Attorney; Director and Vice President, Integrity Mutual Funds; Director, Vice President, and Secretary, Integrity Money Management, ND Capital, Inc. (August 1988 to August 2006), Integrity Fund Services, Inc., and Integrity Funds Distributor; Director, Vice President, and Secretary, South Dakota Tax-Free Fund, Inc. (April 1994 to June 2004), Montana Tax-Free Fund, Inc. (since May 1993), Integrity Fund of Funds, Inc. (since Aug. 1994), and ND Tax Free Fund, Inc. (since Oct. 1988); Vice President and Secretary, The Integrity Funds (since June 2003).	None
Adam C. Forthun 1 N. Main St. Minot, ND 32	Treasurer	Indefinite Since May 2008	N/A	Fund Accountant (May 2003 to October 2005), Fund Accounting Supervisor (October 2005 to March 2008), Fund Accounting Manager (since March 2008), Integrity Fund Services, Inc.; Treasurer (since May 2008), Integrity Managed Portfolios, The Integrity Funds, ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., and Integrity Fund of Funds, Inc.	None
Brent M. Wheeler 1 N. Main St. Minot, ND 58703 37	Mutual Fund Chief Compliance Officer	Indefinite Since October 2005	N/A	Fund Accounting Manager (May 1998 to October 2005), Integrity Fund Services, Inc.; Treasurer (May 2004 to October 2005), Mutual Fund Compliance Officer (since October 2005), Integrity Managed Portfolios, The Integrity Funds, ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., and Integrity Fund of Funds, Inc.	None

⁽¹⁾ The Fund Complex consists of the three incorporated funds in the Integrity family of funds, the six series of Integrity Managed Portfolios, and the three series of The Integrity Funds.

⁽²⁾ Trustees and/or Officers who are "interested persons" of the Fund as defined in the Investment Company Act of 1940, as amended (the "1940 Act"). Mr. Quist is an interested person by virtue of being an Officer and Director of the Fund's investment adviser and principal underwriter. Mr. Walstad is an interested person by virtue of being an Officer of the Fund and a shareholder of Integrity Mutual Funds.

⁽³⁾ Effective February 29, 2008, Mark R. Anderson resigned as President of the Fund, and effective March 4, 2008, Mr. Walstad succeeded Mr. Anderson as Interim President of the Fund. Mr. Walstad is also a Trustee and Chairman of the Fund.

Trustees and Officers of the Fund serve until their resignation, removal, or retirement.

The SAI contains more information about the Fund's Trustees and is available without charge upon request, by calling Integrity Funds Distributor at 800-276-1262.

Schedule of Investments July 31, 2008

Name of Issuer
Percentages represent the market value of each investment category to total net assets	Rating (Unaudited) Moody's/S&P	Coupon Rate	Maturity		Principal Amount		Market Value
KANSAS MUNICIPAL BONDS (97.3%)
Burlington, KS PCR (Gas & Elec.) MBIA	A/AA	5.300%	06/01/2031	$	1,000,000	$	993,800
Burlington, KS PCR (Gas & Elec.) MBIA	A/AA	4.850	06/01/2031		500,000		471,210
Butler Cty., KS Public Bldg. MBIA	A/NR	5.550	10/01/2021		300,000		320,157
Coffeyville, KS Pub. BLdg. (Coffeyville Medl. Center) Rev. AMBAC	Aa-3/AA	5.000	08/01/2022		250,000		254,252
Cowley Cty., KS USD #465 (Winfield) MBIA	A/AA	5.250	10/01/2014		250,000		271,790
Dodge, KS School District #443 FGIC	Baa-1/NR	5.000	09/01/2011		1,000,000		1,049,130
Douglas Cty., KS Sales Tax Ref. AMBAC	Aa-3/NR	5.000	08/01/2019		1,000,000		1,057,430
Harvey Cnty Ks USD #373 (Newton) MBIA	A/NR	5.000	09/01/2025		1,000,000		996,060
Hutchinson, KS Community College	NR/A-	5.000	10/01/2025		350,000		350,557
Hutchinson, KS Community College	NR/A-	5.250	10/01/2030		300,000		297,516
Hutchinson, KS Community College	NR/A-	5.250	10/01/2033		450,000		446,134
#Johnson Cty., KS USD #229 (Blue Valley) G.O.	Aa-1/AA	5.000	10/01/2018		1,350,000		1,395,589
Johnson Cty., KS USD #231 Gardner-Edgerton FGIC	NR/A-	5.000	10/01/2024		1,135,000		1,128,678
Johnson Cty., KS USD #232 (Desoto)	Aaa/NR	5.250	09/01/2023		500,000		532,330
Junction City, KS G.O. AMBAC	Aa-3/AA	5.000	09/01/2025		250,000		256,502
Kansas City, KS Mrtge. Rev. GNMA	Aaa/NR	5.900	11/01/2027		250,000		250,060
*Kansas City, KS Util. Syst. Ref. & Impvt. AMBAC	Aa-3/AA	6.300	09/01/2016		335,000		335,070
KS Devl. Finance Auth. (Dept. of Admin. Capital Restoration) Lease Rev. FSA	Aaa/AAA	5.375	10/01/2020		370,000		393,661
KS Devl. Finance Auth. (Juvenile Justice) Rev. MBIA	A/AA	5.250	05/01/2013		570,000		605,123
*KS Devl. Finance Auth. (Water Pollution Control) Rev.	Aaa/AAA	5.250	05/01/2011		250,000		252,217
KS Devl. Finance Auth. (KS St. Projects) Rev. MBIA	A/AA	5.000	10/01/2017		250,000		263,360
KS Devl. Finance Auth. (Water Pollution Control) Rev.	Aaa/AAA	5.250	11/01/2022		1,000,000		1,052,530
KS Devl. Finance Auth. (Water Pollution Control)	Aaa/AAA	5.000	11/01/2023		1,000,000		1,037,670
KS Devl. Finance Auth.	Aa/AA	5.000	05/01/2026		1,335,000		1,381,632
KS Devl. Finance Auth. (Dept. Admin.) FGIC	Aa/AA	5.000	11/01/2025		250,000		255,660
KS Devl. Finance Auth. (Univ. KS Research Cent.) XLCA	A-1/A	5.000	02/01/2026		500,000		503,885
KDFA Athletic Facs. University of KS	A-1/A	5.000	06/01/2033		250,000		240,748
*KS Devl. Finance Auth. (Park Apts.) Multifamily Hsg. Rev.	NR/AAA	6.000	12/01/2021		1,975,000		1,975,099
KS Devl. Finance Auth. (Sisters of Charity) Hlth. Rev.	Aa/AA	6.125	12/01/2020		1,000,000		1,057,620
KS Devl. Finance Auth. (Hays Medical Center)	A/NR	5.000	11/15/2022		500,000		505,515
KS Devl. Finance Auth. (Stormont Vail) Hlth. Care Rev.—Unrefunded MBIA	A/AA	5.375	11/15/2024		1,365,000		1,419,764
KS Turnpike Auth. Rev. FSA	Aaa/AAA	5.250	09/01/2021		500,000		529,990
KS Turnpike Auth. Rev. FSA	Aaa/AAA	5.000	09/01/2024		330,000		341,111
KS Turnpike Auth. Rev. FSA	Aaa/AAA	5.000	09/01/2025		750,000		770,993
Lawrence, KS (Unlimited Tax) Refunding G.O.	Aa/NR	5.375	09/01/2020		500,000		522,770
Lawrence, KS (Memorial Hospital) Rev. ASGUA-Radian	A-3/A	5.750	07/01/2024		1,000,000		1,037,790
Lawrence, KS (Memorial Hospital) Rev.	A-3/NR	5.125	07/01/2026		500,000		481,760
Lawrence, KS (Memorial Hospital) Rev.	A-3/NR	5.125	07/01/2036		300,000		282,432
Newton, KS (Newton) Hosp. Rev. ACA	NR/NR	5.750	11/15/2024		500,000		461,110
Olathe, KS (Medl. Ctr.) Hlth. Facs. Rev. AMBAC	Aa-3/AA	5.500	09/01/2025		235,000		242,612
Olathe, KS (Medl. Ctr.) Hlth. Facs. Rev. AMBAC	Aa-3/AA	5.500	09/01/2030		500,000		512,800
Olathe, Health Fac Rev (Med Center)	NR/A+	5.000	09/01/2029		500,000		477,855
#Olathe, KS Multifamily Hsg. (Bristol Pointe) Rev. Ref. FNMA	NR/AAA	5.700	11/01/2027		2,210,000		2,210,332
Reno Cty., KS USD #308 Hutchinson MBIA	A/NR	4.500	09/01/2023		500,000		498,075
Salina, KS (General Obligation)	Aa-3/NR	4.625	10/01/2027		200,000		194,450
Sedgwick Cty., KS (Catholic Care Center, Inc.) Hlth. Care Rev.	NR/A	5.800	11/15/2026		1,000,000		1,022,650
Sedgwick Cnty Kans Uni Sch Dist No. 262 Assumed Guaranty	NR/AAA	5.000	09/01/2028		500,000		503,355
Shawnee Cty., KS G.O. FSA	Aaa/NR	5.000	09/01/2016		655,000		709,647
Topeka, KS G.O. XLCA	Aa-3/NR	5.000	08/15/2021		400,000		410,708
*Topeka Public Bldg. Comm (10th & Jackson Prj.) MBIA	A/AA	5.625	06/01/2026		1,435,000		1,481,982
Topeka Public Bldg. Comm. (10th & Jackson Prj.) MBIA	A/AA	5.625	06/01/2031		1,200,000		1,239,288
University of Kansas Hosp. Auth. AMBAC	Aa-3/AAA	5.700	09/01/2020		830,000		865,790
*University of Kansas Hosp. Auth. AMBAC	Aa-3/AAA	5.550	09/01/2026		1,355,000		1,409,756
Wamego, KS PCR (Kansas Gas & Electric Project) MBIA	A/AA	5.300	06/01/2031		750,000		731,835
Washburn Univ. (Living Learning Ctr.) Bldg. Rev. AMBAC	Aa-3/NR	5.000	07/01/2019		700,000		740,768
#Wichita, KS (Via Christi Health System) Rev.	NR/A+	6.250	11/15/2024		1,500,000		1,558,110
Wichita, KS (Via Christi Health System) Rev.	NR/A+	5.625	11/15/2031		1,100,000		1,113,420
Wichita, KS Multifamily Hsg. (Broadmoor Chelsea) Rev. FNMA	NR/AAA	5.650	07/01/2016		990,000		991,049
#Wichita, KS Multifamily Hsg. (Broadmoor Chelsea) Rev. FNMA	NR/AAA	5.700	07/01/2022		2,000,000		2,001,880
Wichita, KS Water & Sewer Util. Rev. FGIC	A-1/NR	5.250	10/01/2018		1,465,000		1,569,132
Wichita, KS Water & Sewer Util. Rev. FGIC	A-1/NR	5.000	10/01/2028		500,000		495,155
Wyandotte City, KS General Obligation FSA	Aaa/AAA	5.000	08/01/2027		500,000		509,795
TOTAL KANSAS MUNICIPAL BONDS (COST: $46,621,048)						$	47,269,149
SHORT-TERM SECURITIES (1.3%)					Shares
Wells Fargo Advantage National Tax-Free Money Market (COST: $615,773)					615,773	$	615,773
TOTAL INVESTMENTS IN SECURITIES (COST: $47,236,821)						$	47,884,922
OTHER ASSETS LESS LIABILITIES							701,880
NET ASSETS						$	48,586,802

*Indicates bonds are segregated by the custodian to cover when-issued or delayed-delivery purchases.

#Indicates bonds are segregated by the custodian to cover initial margin requirements.

Footnote: Non-rated (NR) securities have been determined to be of investment grade quality by the Fund's Manager.

Various inputs are used in determining the value of the Fund's investments. These inputs are summarized in three broad levels:

Level 1—	quoted prices in active markets for identical securities
Level 2—	other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risks, etc.)
Level 3—	significant unobservable inputs (including the Fund's own assumptions in determining the fair value of investments)

The following is a summary of the inputs used to value the Fund's investments as of July 31, 2008:

Valuation Inputs	Investments in Securities
Level 1—Quoted Prices	$	615,773
Level 2—Other Significant Observable Inputs		47,269,149
Level 3—Significant Unobservable Inputs		0
Total	$	47,884,922

The accompanying notes are an integral part of these financial statements.

Financial Statements July 31, 2008

Statement of Assets and Liabilities

July 31, 2008

ASSETS
	Investments in securities, at value (cost: $47,236,821)		$	47,884,922
	Cash			268,806
	Accrued interest receivable			670,066
	Accrued dividends receivable			1,079
	Receivable from manager			4,366
	Prepaid expenses			2,669
		Total Assets	$	48,831,908
LIABILITIES
	Dividends payable		$	158,123
	Payable for fund shares redeemed			25,133
	Accrued expenses			33,544
	Payable to affiliates			28,306
		Total Liabilities	$	245,106
NET ASSETS			$	48,586,802
Net assets are represented by:
	Paid-in capital		$	56,630,679
	Accumulated undistributed net realized gain (loss) on investments and futures			(8,692,469)
	Accumulated undistributed net investment income (loss)			491
	Unrealized appreciation (depreciation) on investments			648,101
		Total amount representing net assets applicable to 4,653,648 outstanding shares of no par common stock (unlimited shares authorized)	$	48,586,802
Net asset value per share			$	10.44
Public offering price (based on sales charge of 4.25%)			$	10.90

The accompanying notes are an integral part of these financial statements.

Financial Statements July 31, 2008

Statement of Operations

For the year ended July 31, 2008

INVESTMENT INCOME
	Interest		$	2,471,321
	Dividends			20,955
		Total Investment Income	$	2,492,276
EXPENSES
	Investment advisory fees		$	255,394
	Distribution (12b-1) fees			127,697
	Administrative service fees			63,555
	Transfer agent fees			101,570
	Accounting service fees			49,422
	Custodian fees			7,605
	Professional fees			24,721
	Trustees fees			5,288
	Insurance expense			1,390
	Reports to shareholders			5,540
	Audit fees			6,773
	Legal fees			38,976
	Transfer agent out-of-pockets			4,061
	License, fees, and registrations			2,066
		Total Expenses	$	694,058
	Less expenses waived or absorbed by the Fund's manager			(147,515)
		Total Net Expenses	$	546,543
NET INVESTMENT INCOME (LOSS)			$	1,945,733
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
	Net realized gain (loss) from investment transactions		$	177,815
	Net change in unrealized appreciation (depreciation) of investments			(619,782)
		Net Realized and Unrealized Gain (Loss) on Investments	$	(441,967)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS			$	1,503,766

The accompanying notes are an integral part of these financial statements.

Financial Statements July 31, 2008

Statement of Changes in Net Assets

For the year ended July 31, 2008 and the year ended July 31, 2007

			For The Year Ended July 31, 2008		For The Year Ended July 31, 2007
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
	Net investment income (loss)		$	1,945,733	$	2,140,169
	Net realized gain (loss) on investment transactions			177,815		85,328
	Net change in unrealized appreciation (depreciation) on investments			(619,782)		(486,178)
		Net Increase (Decrease) in Net Assets Resulting From Operations	$	1,503,766	$	1,739,319
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
	Dividends from net investment income ($.40 and $.40 per share, respectively)		$	(1,945,509)	$	(2,140,064)
	Distributions from net realized gain on investment transactions ($.00 and $.00 per share, respectively)			0		0
		Total Dividends and Distributions	$	(1,945,509)	$	(2,140,064)
CAPITAL SHARE TRANSACTIONS
	Proceeds from sale of shares		$	1,520,973	$	1,094,761
	Proceeds from reinvested dividends			1,289,918		1,368,745
	Cost of shares redeemed			(6,777,875)		(8,160,511)
		Net Increase (Decrease) in Net Assets Resulting from Capital Share Transactions	$	(3,966,984)	$	(5,697,005)
TOTAL INCREASE (DECREASE) IN NET ASSETS			$	(4,408,727)	$	(6,097,750)
NET ASSETS, BEGINNING OF PERIOD				52,995,529		59,093,279
NET ASSETS, END OF PERIOD			$	48,586,802	$	52,995,529
Undistributed Net Investment Income			$	491	$	267

The accompanying notes are an integral part of these financial statements.

Notes to Financial Statements July 31, 2008

Note 1. ORGANIZATION

The Fund is an investment portfolio of Integrity Managed Portfolios (the "Trust") and is registered under the Investment Company Act of 1940, as amended (the "1940 Act") as a non-diversified, open-end management investment company. The Trust may offer multiple portfolios; currently six portfolios are offered. The Trust is an unincorporated business trust organized under Massachusetts law on August 10, 1990. The Fund had no operations from that date to November 15, 1990, other than matters relating to organization and registration. On November 15, 1990, the Fund commenced its Public Offering of capital shares.

The investment objective of the Fund is to provide its shareholders with as high a level of current income exempt from both federal and Kansas state income tax as is consistent with preservation of capital. The Fund will seek to achieve this objective by investing primarily in a portfolio of Kansas municipal securities.

Shares of the Fund are offered at net asset value plus a maximum sales charge of 4.25% of the offering price.

Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Investment security valuation—Securities for which quotations are not readily available (which will constitute a majority of the securities held by the Fund) are valued using a matrix system at fair value as determined by Integrity Money Management. The matrix system has been developed based on procedures approved by the Board of Trustees and includes consideration of the following:

• yields or prices of municipal bonds of comparable quality;

• type of issue, coupon, maturity, and rating;

• indications as to value from dealers; and

• general market conditions.

Because the market value of securities can only be established by agreement between parties in a sales transaction, and because of the uncertainty inherent in the valuation process, the fair values as determined may differ from the values that would have been used had a ready market for the securities existed. The Fund follows industry practice and records security transactions on the trade date.

The Fund concentrates its investments in a single state. This concentration may result in the Fund investing a relatively high percentage of its assets in a limited number of issuers.

When-issued securities—The Fund may purchase securities on a when-issued basis. Payment and delivery may take place after the customary settlement period for that security. The price of the underlying securities and the date when the securities will be delivered and paid for are fixed at the time the transaction is negotiated. The value of the securities purchased on a when-issued basis are identified as such in the Fund's Schedule of Investments. With respect to purchase commitments, the Fund identifies securities as segregated in its records with a value at least equal to the amount of the commitment. Losses may arise due to changes in the value of the underlying securities or if the counterparty does not perform under the contract's terms, or if the issuer does not issue the securities due to political, economic, or other factors.

Contingent Deferred Sales Charge—In the case of investments of $1 million or more, a 1.00% CDSC may be assessed on shares redeemed within 24 months of purchase (excluding shares purchased with reinvested dividends and/or distributions).

Federal and state income taxes—The Fund's policy is to comply with the requirements of the Internal Revenue Code that are applicable to regulated investment companies and to distribute all of its net investment income and any net realized gain on investments to its shareholders. Therefore, no provision for income taxes is required. Distributions during the year ended July 31, 2008 were characterized as tax-exempt for tax purposes.

In June 2006, the Financial Accounting Standards Board ("FASB") issued Interpretation No. 48, "Accounting for Uncertainty in Income Taxes" ("FIN 48"). FIN 48 establishes the minimum threshold for recognizing, and a system for measuring, the benefits of tax-return positions taken on federal income tax returns for all open tax years (tax years ended July 31, 2004 through July 31, 2008) for purposes of implementing FIN 48, and has concluded that no provision for income tax is required in the Fund's financial statements. Interest and penalties related to uncertain tax positions, if any, are classified in the Fund's financial statements as other expense.

The tax character of distributions paid was as follows:

			July 31, 2008		July 31, 2007
Tax-exempt income		$	1,945,509	$	2,140,064
Ordinary income			0		0
Long-term capital gains			0		0
	Total	$	1,945,509	$	2,140,064

As of July 31, 2008, the components of accumulated earnings/(deficit) on a tax basis were as follows:

Undistributed Ordinary Income	Undistributed Long-Term Capital Gains	Undistributed Accumulated Earnings	Accumulated Capital and Other Losses	Unrealized Appreciation/ (Depreciation)	Total Accumulated Earnings/(Deficit)
$0	$0	$0	($8,692,469)	$648,592	($8,043,877)

The Fund has unexpired capital loss carryforwards for tax purposes as of July 31, 2008 totaling $8,692,469, which may be used to offset capital gains. Any difference between book-basis and tax-basis unrealized appreciation/(depreciation) is attributable to timing differences associated with market discount. The capital loss carryforward amounts will expire in each of the years ended July 31 as shown in the table below.

Year	Unexpired Capital Losses
2009	$568,023
2010	$1,444,860
2011	$1,970,032
2012	$1,399,598
2013	$2,680,173
2014	$388,935
2015	$240,848

For the year ended July 31, 2008, the Fund made $353,577 in permanent reclassifications to reflect tax character. Reclassifications to paid-in capital relate primarily to expiring capital loss carryforwards.

Net capital losses incurred after October 31 and within the tax year are deemed to arise on the first business day of the Fund's next taxable year. For the year ended July 31, 2008, the Fund did not defer to August 1, 2008, any post-October capital losses, post-October currency losses, or post-October passive foreign investment company losses.

Distributions to shareholders—Dividends from net investment income, declared daily and paid monthly, are reinvested in additional shares of the Fund at net asset value or paid in cash. Capital gains, when available, are distributed at least annually.

Premiums and discounts—Premiums and discounts on municipal securities are amortized for financial reporting purposes.

Other—Income and expenses are recorded on the accrual basis. Investment transactions are accounted for on the trade date. Realized gains and losses are reported on the identified cost basis. Distributions to shareholders are recorded by the Fund on the ex-dividend date. Income and capital gain distributions are determined in accordance with federal income tax regulations and may differ from net investment income and realized gains determined in accordance with accounting principles generally accepted in the United States of America. These differences are primarily due to differing treatments for market discount, capital loss carryforwards, and losses due to wash sales and futures transactions.

Permanent book and tax basis differences relating to shareholder distributions will result in reclassifications to paid-in capital. Temporary book and tax basis differences will reverse in a subsequent period.

Futures contracts—The Fund may purchase and sell financial futures contracts to hedge against changes in the values of tax-exempt municipal securities the Fund owns or expects to purchase.

A futures contract is an agreement between two parties to buy or sell units of a particular index or a certain amount of U.S. government or municipal securities at a set price on a future date. Upon entering into a futures contract, the Fund is required to deposit with a broker an amount of cash or securities equal to the minimum "initial margin" requirement of the futures exchange on which the contract is traded. Subsequent payments ("variation margin") are made or received by the Fund, dependent on the fluctuations in the value of the underlying index. Daily fluctuations in value are recorded for financial reporting purposes as unrealized gains or losses by the Fund. When entering into a closing transaction, the Fund will realize, for book purposes, a gain or loss equal to the difference between the value of the futures contracts sold and the futures contracts to buy. Unrealized appreciation (depreciation) related to open futures contracts is required to be treated as realized gain (loss) for federal income tax purposes.

Securities held in collateralized accounts to cover initial margin requirements on open futures contracts are noted in the Schedule of Investments. The Statement of Assets and Liabilities reflects a receivable or payable for the daily mark to market for variation margin.

Certain risks may arise upon entering into futures contracts. These risks may include changes in the value of the futures contracts that may not directly correlate with changes in the value of the underlying securities.

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

Note 3. CAPITAL SHARE TRANSACTIONS

As of July 31, 2008, there were unlimited shares of no par authorized; 4,653,648 and 5,029,080 shares were outstanding at July 31, 2008 and July 31, 2007, respectively.

Transactions in capital shares were as follows:

	Shares
	For The Year Ended July 31, 2008	For The Year Ended July 31, 2007
Shares sold	144,053	102,578
Shares issued on reinvestment of dividends	122,244	128,616
Shares redeemed	(641,729)	(767,828)
Net increase (decrease)	(375,432)	(536,634)

Note 4. INVESTMENT ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES

Integrity Money Management, the Fund's investment adviser; Integrity Funds Distributor, the Fund's underwriter; and Integrity Fund Services, Inc. ("Integrity Fund Services"), the Fund's transfer, accounting, and administrative services agent; are subsidiaries of Integrity Mutual Funds, the Fund's sponsor.

The Fund has engaged Integrity Money Management to provide investment advisory and management services to the Fund. The Investment Advisory Agreement provides for fees to be computed at an annual rate of 0.50% of the Fund's average daily net assets. The Fund has recognized $116,481 of investment advisory fees after partial waiver for the year ended July 31, 2008. The Fund does not have a payable to Integrity Money Management at July 31, 2008 for investment advisory fees. Certain Officers and Trustees of the Fund are also Officers and Directors of Integrity Money Management.

Under the terms of the advisory agreement, Integrity Money Management has agreed to pay all the expenses of the Fund (excluding taxes and brokerage fees and commissions, if any) that exceed 1.07% of the Fund's average daily net assets on an annual basis up to the amount of the investment advisory and management fee. Integrity Money Management and Integrity Funds Distributor may also voluntarily waive fees or reimburse expenses not required under the advisory or other contracts from time to time. Accordingly, after fee waivers and expense reimbursements, the Fund's actual total annual operating expenses were 1.07% for the year ended July 31, 2008.

Principal underwriter and shareholder services

Integrity Funds Distributor serves as the principal underwriter for the Fund. The Fund has adopted a distribution plan as allowed by Rule 12b-1 of the 1940 Act. Distribution plans permit the Fund to reimburse its principal underwriter for costs related to selling shares of the Fund and for various other services. These costs, which consist primarily of commissions and service fees to broker-dealers who sell shares of the Fund, are paid by shareholders through expenses called "Distribution Plan expenses". The Fund currently pays an annual distribution fee of up to 0.25% of the average daily net assets of the Fund. Distribution Plan expenses are calculated daily and paid monthly. The Fund has recognized $127,697 of distribution fees for the year ended July 31, 2008. The Fund has a payable to Integrity Funds Distributor of $10,311 at July 31, 2008 for distribution fees.

Integrity Fund Services, the transfer agent, provides shareholder services for a variable fee equal to 0.20% of the Fund's average daily net assets on an annual basis for the Fund's first $50 million and at a lower rate on the average daily net assets in excess of $50 million, with a minimum of $2,000 per month plus reimbursement of out-of-pocket expenses. An additional fee of $500 per month is charged for each additional share class. The Fund has recognized $101,570 of transfer agency fees and expenses for the year ended July 31, 2008. The Fund has a payable to Integrity Fund Services of $8,249 at July 31, 2008 for transfer agency fees. Integrity Fund Services also acts as the Fund's accounting services agent for a monthly fee equal to the sum of a fixed fee of $2,000 and a variable fee equal to 0.05% of the Fund's average daily net assets on an annual basis for the Fund's first $50 million and at a lower rate on the average daily net assets in excess of $50 million, together with reimbursement of out-of-pocket expenses. An additional minimum fee of $500 per month is charged by Integrity Fund Services for each additional share class. The Fund has recognized $49,422 of accounting service fees for the year ended July 31, 2008. The Fund has a payable to Integrity Fund Services of $4,062 at July 31, 2008 for accounting service fees. Integrity Fund Services also acts as the Fund's administrative services agent for a variable fee equal to 0.125% of the Fund's average daily net assets on an annual basis for the Fund's first $50 million and at a lower rate on the average daily net assets in excess of $50 million, with a minimum of $2,000 per month plus out-of-pocket expenses. An additional fee of $500 per month is charged by Integrity Fund Services for each additional share class. The Fund has recognized $63,555 of administrative service fees for the year ended July 31, 2008. The Fund has a payable to Integrity Fund Services of $5,155 at July 31, 2008 for administrative service fees.

Note 5. INVESTMENT SECURITY TRANSACTIONS

The cost of purchases and proceeds from the sales of investment securities (excluding short-term securities) aggregated $3,240,873 and $7,245,185, respectively, for the year ended July 31, 2008.

Note 6. INVESTMENT IN SECURITIES

At July 31, 2008, the aggregate cost of securities for federal income tax purposes was substantially the same for financial reporting purposes at $47,236,821. The net unrealized appreciation of investments based on the cost was $648,101, which is comprised of $939,573 aggregate gross unrealized appreciation and $291,472 aggregate gross unrealized depreciation. Differences between financial reporting-basis and tax-basis unrealized appreciation/(depreciation) are due to differing treatment of market discount.

Note 7. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In September 2006, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards (SFAS) No. 157 Fair Value Measurements. This standard defines fair value, and establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands disclosures about fair value measurements. The standard is effective for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years.

In accordance with the provisions of SFAS No. 157, the Fund adopted this standard during the current fiscal year. The implementation of the standard did not impact the amounts reported in the financial statements.

In March 2008, FASB issued SFAS No. 161 Disclosures about Derivative Instruments and Hedging Activities. This standard requires enhanced disclosures to provide information about the reasons the Fund invests in derivative instruments, the accounting treatment and the effect derivatives have on financial performance. The standard is effective for fiscal years beginning after November 15, 2008, and interim periods within those fiscal years. Management is currently evaluating the impact the adoption of SFAS No. 161 will have on the Fund's financial statement disclosures.

Financial Highlights July 31, 2008

Selected per share data and ratios for the periods indicated

					For The Year Ended July 31, 2008		For The Year Ended July 31, 2007		For The Year Ended July 31, 2006		For The Year Ended July 29, 2005		For The Year Ended July 30, 2004
NET ASSET VALUE, BEGINNING OF PERIOD				$	10.54	$	10.62	$	10.57	$	10.93	$	11.19
Income from Investment Operations:
	Net investment income (loss)			$	.40	$	.40	$	.41	$	.38	$	.45
	Net realized and unrealized gain (loss) on investment and futures transactions				(.10)		(.08)		.05		(.36)		(.26)
		Total Income (Loss) From Investment Operations		$	.30	$	.32	$	.46	$	.02	$	.19
Less Distributions:
	Dividends from net investment income			$	(.40)	$	(.40)	$	(.41)	$	(.38)	$	(.45)
	Distributions from net realized gains				.00		.00		.00		.00		.00
			Total Distributions	$	(.40)	$	(.40)	$	(.41)	$	(.38)	$	(.45)
NET ASSET VALUE, END OF PERIOD				$	10.44	$	10.54	$	10.62	$	10.57	$	10.93
Total Return					2.90%(A)		3.06%(A)		4.39%(A)		0.22%(A)		1.71%(A)
RATIOS/SUPPLEMENTAL DATA:
	Net assets, end of period (in thousands)			$	48,587	$	52,996	$	59,093	$	67,470	$	78,478
	Ratio of net expenses (after expense assumption) to average net assets				1.07%(B)		1.07%(B)		1.03%(B)		0.97%(B)		0.95%(B)
	Ratio of net investment income to average net assets				3.81%		3.77%		3.82%		3.56%		4.05%
	Portfolio turnover rate				6.52%		4.77%		12.31%		44.85%		17.29%

^(A) Excludes maximum sales charge of 4.25%.

^(B) During the periods indicated above, Integrity Money Management assumed and/or waived expenses of $147,515, $106,719, $79,585, $130,764, and $127,695, respectively. If the expenses had not been assumed and/or waived, the annualized ratio of total expenses to average net assets would have been 1.36%, 1.26%, 1.15%, 1.15%, and 1.10%, respectively.

Total return represents the rate that an investor would have earned or lost on an investment in the Fund assuming reinvestment of all dividends and distributions.

The accompanying notes are an integral part of these financial statements.

Tax Information for the Year Ended July 31, 2008 (Unaudited)

We are required to advise you within 60 days of the Fund's fiscal year regarding the federal tax status of distributions received by shareholders during such fiscal year. The distributions made during the fiscal year by the Fund were earned from the following sources:

		Dividends and Distributions Per Share
To Shareholders of Record	Payment Date		From Net Investment Income	From Net Realized Short-Term Gains	From Net Realized Long-Term Gains
August 31, 2007	August 31, 2007	$	.033666	.0	.0
September 28, 2007	September 28, 2007	$	.031289	.0	.0
October 31, 2007	October 31, 2007	$	.035237	.0	.0
November 30, 2007	November 30, 2007	$	.033453	.0	.0
December 31, 2007	December 31, 20007	$	.033548	.0	.0
January 31, 2008	January 31, 2008	$	.033629	.0	.0
February 29, 2008	February 29, 2008	$	.033481	.0	.0
March 31, 2008	March 31, 2008	$	.033777	.0	.0
April 30, 2008	April 30, 2008	$	.033732	.0	.0
May 30, 2008	May 30, 2008	$	.033610	.0	.0
June 30, 2008	June 30, 2008	$	.033593	.0	.0
July 31, 2008	July 31, 2008	$	.033515	.0	.0

Shareholders should consult their tax advisors.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Trustees of the Kansas Municipal Fund

We have audited the accompanying statement of assets and liabilities of the Kansas Municipal Fund (one of the portfolios constituting the Integrity Managed Portfolios), including the schedule of investments as of July 31, 2008, the related statement of operations for the year then ended, the statement of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended. These financial statements and financial highlights are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of July 31, 2008 by correspondence with the custodian and brokers. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Kansas Municipal Fund of the Integrity Managed Portfolios as of July 31, 2008, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.

BRADY, MARTZ & ASSOCIATES, P.C.

Minot, North Dakota USA

September 12, 2008

Dear Shareholder:

Enclosed is the annual report of the Kansas Insured Intermediate Fund (the "Fund") for the year ended July 31, 2008. The Fund's portfolio and related financial statements are presented within for your review.

As we end the year, what one might have thought was an uneventful year was much the opposite.

First, interest rates spiked higher early in June as Federal Reserve Chairman Ben Bernanke voiced concern about inflation and the slumping dollar. However, a string of weak economic reports in the last part of June (consumer confidence plunged to its lowest level since 1992) along with more losses and downgrades in the banking sector, reduced corporate earnings expectations as well as higher energy prices have encouraged market participants to dump stocks in favor of low-risk government bonds, sending the 10-year treasury to 3.95%

Second, while the market likes to talk about light at the end of the tunnel, unfortunately in these days of financial turmoil we can never be sure whether it is light from the other side or another freight train coming. Most recently, Fannie Mae and Freddie Mac who own or guarantee nearly half of the $12 trillion mortgage market have seen their company stocks fall 75-80% year-to-date, as the worst housing downturn since the Great Depression impacted expected solvency levels.

Municipals on the other hand didn't fare any better as a number of the secondary insurers saw significant downgrades of their ratings, the collapse of major financial institution Bear Stearns and the exit of UBS from the municipal bond market.

The secondary insurers of municipal debt are in turmoil as a number of the insurance companies are in dire straits. Many bond professionals and investors, who in the past treated all insured bonds equal from a credit perspective, now understand the importance of the underlying credit, the purpose of the debt issued, and its commitment to pay. Currently there are three insurers of municipal debt that have AAA ratings from all three rating agencies and two of those three insurers are on Credit Watch for possible downgrade.

The bonds owned by the Fund that have their insurers downgraded tend to be of very high quality. Insurance companies tend to insure municipal bonds that are mostly in the "A" category and above. If an insured bond defaults, the insurance company is only liable for the interest and principal payments due. They are not required to pay off the entire bond issue.

These events have created great uncertainty and with that, opportunity. It is now a buyers market as high quality municipals are yielding in many instances, yields higher than taxable treasuries of similar maturities. Clearly there will be price rallies and price sell offs in the months ahead, but the underlying tone for tax-free municipals is bullish.

The Kansas Insured Intermediate Fund began the period at $10.87 and ended the period at $10.94 for a total return of 4.62%*. This compares to the Lehman Brothers Municipal Seven-Year Maturity Bond Index return of 5.83%.

We are pleased to report that Lipper Reporting Service has ranked the Kansas Insured Intermediate Fund the number one fund for the reporting period ended December 31, 2007 in the Insured Municipal Debt Fund category.

The Fund's yearly overall performance can be attributed to its defensive portfolio, with an average maturity of 8.2 years and an average maturity to the first call date of 3.2 years. That, along with an average portfolio coupon of 5.09% helps relative performance in volatile environments.

An important part of the Fund's strategy includes searching the primary and secondary markets for high quality, double tax-exempt issues. Some purchases made throughout the year include: Leavenworth County Schools, 4.50% coupon, due 2028; Butler County Schools, 5.25% coupon, due 2021; Cowley County Schools, 4.75% coupon, due 2023; and Sedgwick County Schools, 5.00% coupon, due 2018.

Portfolio quality at year-end was as follows: AAA 54.8%, AA 33.2%, A 9.8%, and NR 2.2%. 

Income exempt from federal and Kansas state income taxes with preservation of capital remain the primary objectives of the Fund.

If you would like more frequent updates, visit the Fund's website at www.integrityfunds.com for daily prices along with pertinent Fund information.

Sincerely,

Monte Avery

Senior Portfolio Manager

The views expressed are those of Monte Avery, Senior Portfolio Manager with Integrity Mutual Funds, Inc. ("Integrity Mutual Funds"). The views are subject to change at any time in response to changing circumstances in the market and are not intended to predict or guarantee the future performance of any individual security, market sector, the markets generally, or any Integrity Mutual Fund.

*Performance does not include applicable front-end or contingent deferred sales charges ("CDSCs"), which would have reduced the performance.

Performance data quoted above is historical. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. The principal value and investment return of an investment will fluctuate so that your shares, when redeemed, may be worth more or less than the original cost. You can obtain performance data current to the most recent month end (available within seven business days of the most recent month end) by calling 800-276-1262.

You should consider the Fund's investment objectives, risks, charges, and expenses carefully before investing. For this and other important information, please obtain a Fund prospectus at no cost from your financial adviser and read it carefully before investing.

Bond prices and, therefore, the value of bond funds decline as interest rates rise. Because the Fund invests in securities of a single state, the Fund is more susceptible to factors adversely impacting the respective state securities more so than a municipal bond fund that does not concentrate its securities in a single state.

July 31, 2008 (Unaudited)

PROXY VOTING OF FUND PORTFOLIO SECURITIES

A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to securities held in the Fund's portfolio is available, without charge and upon request, by calling 800-276-1262. A report on Form N-PX of how the Fund voted any such proxies during the most recent twelve-month period ended June 30 is available through the Fund's website at www.integrityfunds.com. The information is also available from the Electronic Data Gathering, Analysis, and Retrieval ("EDGAR") database on the website of the Securities and Exchange Commission ("SEC") at www.sec.gov.

QUARTERLY PORTFOLIO SCHEDULE

Within 60 days of the end of its second and fourth fiscal quarters, the Fund provides a complete schedule of portfolio holdings in its semi-annual and annual reports on the Form N-CSR(S). These reports are filed electronically with the SEC and are delivered to the shareholders of the Fund. The Fund also files its 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 Forms N-Q and N-CSR(S) are available on the SEC's website at www.sec.gov. The Fund's Forms N-Q and N-CSR(S) 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 202-942-8090. You may also access this information from the Fund's website at www.integrityfunds.com.

SHAREHOLDER INQUIRIES AND MAILINGS

All inquiries regarding the Fund should be directed to:

Integrity Funds Distributor, Inc.

1 Main Street North

Minot, ND 58703

Phone: 800-276-1262

All inquiries regarding account information should be directed to:

Integrity Fund Services, Inc.

P.O. Box 759

Minot, ND 58702

Phone: 800-601-5593

To reduce expenses, the Fund may only mail one copy of its prospectus and each annual and semi-annual report to those addresses shared by two or more accounts. If you wish to receive individual copies of these documents, please call Integrity Funds Distributor, Inc. ("Integrity Funds Distributor") at 800-276-1262 (or contact your financial institution). Individual copies will be sent thirty days after receiving your request.

Terms & Definitions July 31, 2008 (Unaudited)

Appreciation

Increase in the value of an asset

Average Annual Total Return

A standardized measurement of the return (yield and appreciation) earned by a fund on an annual basis assuming all distributions are reinvested

Coupon Rate or Face Rate

Rate of interest payable annually based on the face amount of the bond; expressed as a percentage

Depreciation

Decrease in the value of an asset

Lehman Brothers Municipal Bond Index

An unmanaged list of long-term, fixed-rate, investment-grade, tax-exempt bonds representative of the municipal bond market; the index does not take into account brokerage commissions or other costs, may include bonds different from those in the Fund, and may pose different risks than the Fund

Market Value

Actual (or estimated) price at which a bond trades in the marketplace

Maturity

A measure of the term or life of a bond in years; when a bond "matures", the issuer repays the principal

Net Asset Value

The value of all of a fund's assets, minus any liabilities, divided by the number of outstanding shares, not including any initial sales charge

Quality Ratings

A designation assigned by independent rating companies to give a relative indication of a bond's creditworthiness; "AAA," "AA," "A," and "BBB" indicate investment grade securities. Ratings can range from a high of "AAA" to a low of "D".

Total Return

Measures both the net investment income and any realized and unrealized appreciation or depreciation of the underlying investments in a fund's portfolio for the period, assuming the reinvestment of all dividends; represents the aggregate percentage or dollar value change over the period

July 31, 2008 (Unaudited)

COMPOSITION

Portfolio Quality Ratings

(Based on total long-term investments)

AAA	54.8%
AA	33.2%
A	9.8%
NR	2.2%

Quality ratings reflect the financial strength of the issuer. They are assigned by independent ratings services such as Moody's Investors Services ("Moody's") and Standard & Poor's Ratings Group ("S&P"). Non-rated bonds have been determined to be of appropriate quality for the portfolio by Integrity Money Management, Inc. ("Integrity Money Management"), the Fund's investment adviser.

These percentages are subject to change.

Portfolio Market Sectors

(As a percentage of Net Assets)

S—School	33.4%
H—Housing	21.2%
HC—Health Care	11.5%
T—Transportation	10.5%
W/S—Water/Sewer	10.5%
U—Utilities	5.8%
O—Other	3.9%
G—Government	3.2%

Market sectors are breakdowns of the Fund's portfolio holdings into specific investment classes.

These percentages are subject to change.

July 31, 2008 (Unaudited)

DISCLOSURE OF FUND EXPENSES

The example below is intended to describe the fees and expenses borne by shareholders and the impact of those costs on your investment.

EXAMPLE

As a shareholder of the Fund, you incur two types of costs:

•	transaction costs:	sales charges (loads), redemption fees, and exchange fees
•	ongoing costs:	management fees, distribution (12b-1) fees, and other Fund expenses

This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period from January 31, 2008 to July 31, 2008.

The example illustrates the Fund's costs in two ways:

Actual expenses

The section in the table under the heading "Actual" provides information about actual account values and actual expenses. You may use the information in these columns together with the amount you invested to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an account value of $8,600 divided by $1,000 equals 8.6), then multiply the result by the number in the column entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period.

Hypothetical example for comparison purposes

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

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees, or exchange fees. Therefore, the section in the table under the heading "Hypothetical (5% return before expenses)" is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

	Beginning Account Value 01/31/08	Ending Account Value 07/31/08	Expenses Paid During Period*
Actual	$1,000.00	$1,006.33	$3.76
Hypothetical (5% return before expenses)	$1,000.00	$1,021.11	$3.79

*Expenses are equal to the annualized expense ratio of 0.75%, multiplied by the average account value over the period, multiplied by 180/360 days. The Fund's ending account value on the first line in the table is based on its actual total return of 0.63% for the six-month period of January 31, 2008 to July 31, 2008.

July 31, 2008 (Unaudited)

AVERAGE ANNUAL TOTAL RETURNS

		For periods ending July 31, 2008
Kansas Insured Intermediate Fund		1 year	3 year	5 year	10 year	Since Inception (November 23, 1992)
	Without Sales Charge	4.62%	4.01%	2.70%	3.14%	3.91%
	With Sales Charge (2.75%)	1.71%	3.04%	2.12%	2.85%	3.73%
Lehman Brothers Municipal Seven-Year Maturity Bond Index		1 year	3 year	5 year	10 year	Since Inception (November 23, 1992)
		5.83%	3.96%	4.08%	4.83%	5.41%

Putting Performance into Perspective

Performance data quoted above is historical. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. The principal value and investment return of an investment will fluctuate so that your shares, when redeemed, may be worth more or less than the original cost. You can obtain performance data current to the most recent month end (available within seven business days of the most recent month end) by calling 800-276-1262.

You should consider the Fund's investment objectives, risks, charges, and expenses carefully before investing. For this and other important information, please obtain a Fund prospectus at no cost from your financial adviser and read it carefully before investing.

The table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions and redemption of Fund shares.

July 31, 2008 (Unaudited)

COMPARATIVE INDEX GRAPH

Comparison of change in value of a $10,000 investment in the Fund and the Lehman Brothers Municipal Seven-Year Maturity Bond Index

	Kansas Insured Intermediate Fund without Sales Charge		Kansas Insured Intermediate Fund with Maximum Sales Charge		Lehman Brothers Municipal Seven-Year Maturity Bond Index
7/31/98	$	10,000	$	9,726	$	10,000
1999	$	10,370	$	10,086	$	10,329
2000	$	10,594	$	10,304	$	10,803
2001	$	11,307	$	10,997	$	11,794
2002	$	11,772	$	11,450	$	12,635
2003	$	11,921	$	11,594	$	13,122
2004	$	12,196	$	11,862	$	13,719
2005	$	12,105	$	11,774	$	14,262
2006	$	12,597	$	12,252	$	14,568
2007	$	13,018	$	12,662	$	15,142
7/31/08	$	13,619	$	13,246	$	16,024

Putting Performance into Perspective

Performance data quoted above is historical. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. The principal value and investment return of an investment will fluctuate so that your shares, when redeemed, may be worth more or less than the original cost. You can obtain performance data current to the most recent month end (available within seven business days of the most recent month end) by calling 800-276-1262.

You should consider the Fund's investment objectives, risks, charges, and expenses carefully before investing. For this and other important information, please obtain a Fund prospectus at no cost from your financial adviser and read it carefully before investing.

The graph does not reflect the deduction of taxes that a shareholder would pay on Fund distributions and redemptions of Fund shares.

The graph comparing the Fund's performance to a benchmark index provides you with a general sense of how the Fund performed. To put this information in context, it may be helpful to understand the special differences between the two. The Lehman Brothers Municipal Seven-Year Maturity Bond Index is a national index representative of the national municipal bond market, whereas the Fund concentrates its investments in Kansas municipal bonds. The Fund's total return for the periods shown appears with and without sales charges and includes Fund expenses and management fees. A securities index measures the performance of a theoretical portfolio. Unlike a fund, the index is unmanaged; there are no expenses that affect the results. In addition, few investors could purchase all of the securities necessary to match the index. If they could, they would incur transaction costs and other expenses. All Fund and benchmark returns include reinvested dividends.

July 31, 2008 (Unaudited)

MANAGEMENT OF THE FUND

The Board of the Fund consists of four Trustees. These same individuals, unless otherwise noted, also serve as Directors or Trustees for all of the funds in the Integrity family of funds, the six series of Integrity Managed Portfolios, and the three series of The Integrity Funds. Three Trustees (75% of the total) have no affiliation or business connection with Integrity Money Management or any of its affiliates; these are the "Independent" Trustees. Two of the remaining three Trustees and/or Officers are "interested" by virtue of their affiliation with Integrity Money Management and/or its affiliates.

The Independent Trustees of the Fund, their term of office and length of time served, their principal occupation(s) during the past five years, the number of portfolios overseen in the Fund Complex by each Independent Trustee, and other Directorships, if any, held outside the Fund Complex, are shown below.

INDEPENDENT TRUSTEES

NAME, ADDRESS, AND AGE	POSITION(S) HELD WITH REGISTRANT	TERM AND LENGTH SERVED	NUMBER OF PORTFOLIOS OVERSEEN IN THE FUND COMPLEX(1)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS	OTHER DIRECTORSHIPS HELD OUTSIDE THE FUND COMPLEX
Jerry M. Stai 2405 11th Ave. NW Minot, ND 58703 56	Trustee	Indefinite Since January 2006	12	Faculty, Embry-Riddle University (August 2000 to September 2005); Faculty, Park University (August 2005 to December 2005); Non-Profit Specialist, Bremer Bank (since July 2005); Faculty, Minot State University (since August 2000); Director, ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., Integrity Fund of Funds, Inc., (since January 2006); Trustee, The Integrity Funds (since January 2006).	Marycrest Franciscan Development, Inc.
Orlin W. Backes 948 13th Ave.SW Minot, ND 58701 73	Trustee	Indefinite Since January 1996	12	Attorney, McGee, Hankla, Backes & Dobrovolny, P.C.; Director, South Dakota Tax-Free Fund, Inc. (April 1995 to June 2004), ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., and Integrity Fund of Funds, Inc., (since April 2005); Trustee, The Integrity Funds (since June 2003).	First Western Bank & Trust
R. James Maxson 1 N. Main St. Minot, ND 58703 60	Trustee	Indefinite Since January 1999	12	Attorney, Maxson Law Office (since November 2002); Director, South Dakota Tax-Free Fund, Inc. (January 1999 to June 2004), Integrity Fund of Funds, Inc., ND Tax-Free Fund, Inc. and Montana Tax-Free Fund, Inc. (since January 1999); and Trustee, The Integrity Funds (since June 2003).	Vincent United Methodist Foundation Minot Area Development Corporation

⁽¹⁾ The Fund Complex consists of the three incorporated funds in the Integrity family of funds, the six series of Integrity Managed Portfolios, and the three series of The Integrity Funds.

Trustees and Officers of the Fund serve until their resignation, removal, or retirement.

The Statement of Additional Information ("SAI") contains more information about the Fund's Trustees and is available without charge upon request, by calling Integrity Funds Distributor at 800-276-1262.

The Interested Trustees and Officers of the Fund, their term of office and length of time served, their principal occupation(s) during the past five years, the number of portfolios overseen in the Fund Complex by each Interested Trustee, and other Directorships, if any, held outside the Fund Complex, are shown below.

INTERESTED TRUSTEE AND OFFICER

NAME, ADDRESS, AND AGE	POSITION(S) HELD WITH REGISTRANT	TERM AND LENGTH SERVED	NUMBER OF PORTFOLIOS OVERSEEN IN THE FUND COMPLEX(1)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS	OTHER DIRECTORSHIPS HELD OUTSIDE THE FUND COMPLEX
Robert E. Walstad(2)(3) 1 N. Main St. Minot, ND 58703 63	Trustee, Chairman, Interim President	Indefinite Since January 1996	12	Director (Sept. 1987 to Feb. 2007), CEO (Sept. 2001 to Feb. 2007), Integrity Mutual Funds; Director, President, and Treasurer, (Aug. 1988 to Feb. 2007), Integrity Money Management; Director, President, and Treasurer (Aug. 1988 to Sept. 2004), ND Capital, Inc.; Director, President, and Treasurer (May 1989 to Feb. 2007), Integrity Fund Services, Inc.; Director, President, CEO, and Treasurer (Jan. 1996 to Aug. 2003), Integrity Funds Distributor, Inc.; Director, CEO, Chairman, (Jan. 2002 to Feb. 2007) and President (Sept. 2002 to Dec. 2004), Capital Financial Services, Inc.; Director and President (April 1994 to June 2004), South Dakota Tax-Free Fund, Inc.; President (Jan. 1996 to July 2007) and (since March 2008) Integrity Managed Portfolios, (May 2003 to July 2007) and (since March 2008) The Integrity Funds, (Jan. 1995 to July 2007) and (since March 2008) Integrity Fund of Funds, Inc., (Jan. 1989 to July 2007) and (since March 2008) ND Tax-Free Fund, Inc., (Aug. 1993 to July 2007) and (since March 2008) Montana Tax-Free Fund, Inc.; Director and Chairman Montana Tax-Free Fund, Inc. (since May 1993), Integrity Fund of Funds, Inc. (since Aug. 1994), and ND Tax Free Fund, Inc. (since Oct. 1988); Trustee, Chairman, (since January 1996) and Treasurer (January 1996 to May 2004), Integrity Managed Portfolios; Trustee and Chairman (since June 2003), The Integrity Funds.	Minot Park Board

OFFICERS

NAME, ADDRESS, AND AGE	POSITION(S) HELD WITH REGISTRANT	TERM AND LENGTH SERVED	NUMBER OF PORTFOLIOS OVERSEEN IN THE FUND COMPLEX(1)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS	OTHER DIRECTORSHIPS HELD OUTSIDE THE FUND COMPLEX
Peter A. Quist 1 N. Main St. Minot, ND 58703 74	Vice President, Secretary	Indefinite Since January 1996	3	Attorney; Director and Vice President, Integrity Mutual Funds; Director, Vice President, and Secretary, Integrity Money Management, ND Capital, Inc. (August 1988 to August 2006), Integrity Fund Services, Inc., and Integrity Funds Distributor; Director, Vice President, and Secretary, South Dakota Tax-Free Fund, Inc. (April 1994 to June 2004), Montana Tax-Free Fund, Inc. (since May 1993), Integrity Fund of Funds, Inc. (since Aug. 1994), and ND Tax Free Fund, Inc. (since Oct. 1988); Vice President and Secretary, The Integrity Funds (since June 2003).	None
Adam C. Forthun 1 N. Main St. Minot, ND 58703 32	Treasurer	Indefinite Since May 2008	N/A	Fund Accountant (May 2003 to October 2005), Fund Accounting Supervisor (October 2005 to March 2008), Fund Accounting Manager (since March 2008), Integrity Fund Services, Inc.; Treasurer (since May 2008), Integrity Managed Portfolios, The Integrity Funds, ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., and Integrity Fund of Funds, Inc.	None
Brent M. Wheeler 1 N. Main St. Minot, ND 58703 37	Mutual Fund Chief Compliance Officer	Indefinite Since October 2005	N/A	Fund Accounting Manager (May 1998 to October 2005), Integrity Fund Services, Inc.; Treasurer (May 2004 to October 2005), Mutual Fund Compliance Officer (since October 2005), Integrity Managed Portfolios, The Integrity Funds, ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., and Integrity Fund of Funds, Inc.	None

⁽¹⁾ The Fund Complex consists of the three incorporated funds in the Integrity family of funds, the six series of Integrity Managed Portfolios, and the three series of The Integrity Funds.

⁽²⁾ Trustees and/or Officers who are "interested persons" of the Fund as defined in the Investment Company Act of 1940, as amended (the "1940 Act"). Mr. Quist is an interested person by virtue of being an Officer and Director of the Fund's investment adviser and principal underwriter. Mr. Walstad is an interested person by virtue of being an Officer of the Fund and a shareholder of Integrity Mutual Funds.

⁽³⁾ Effective February 29, 2008, Mark R. Anderson resigned as President of the Fund, and effective March 4, 2008, Mr. Walstad succeeded Mr. Anderson as Interim President of the Fund. Mr. Walstad is also a Trustee and Chairman of the Fund.

Trustees and Officers of the Fund serve until their resignation, removal, or retirement.

The SAI contains more information about the Trustees and is available without charge upon request, by calling Integrity Funds Distributor at 800-276-1262.

Schedule of Investments July 31, 2008

Name of Issuer
Percentages represent the market value of each investment category to total net assets	Rating (Unaudited) Moody's/S&P	Coupon Rate	Maturity		Principal Amount		Market Value
KANSAS MUNICIPAL BONDS (96.2%)
Butler Cty., KS (Circle) USD #375 FSA	Aaa/NR	5.000%	09/01/2013	$	250,000	$	258,718
Butler Cty., KS USD#402 Assured GTY	Aaa/NR	5.250	09/01/2021		250,000		266,617
#Chisholm Creek Util. Auth. (Bel Aire & Park City, KS Pj.) MBIA	A/NR	5.250	09/01/2016		770,000		837,421
Cowley County, KS USD# 470 FSA	NR/AAA	4.750	09/01/2023		100,000		101,477
Cowley Cty., KS USD #465 (Winfield) MBIA	A/AA	5.250	10/01/2014		140,000		152,202
Dodge, KS USD #443 Unltd. General Obligation FSA	Aaa/AAA	5.750	09/01/2013		100,000		104,464
Harvey County KS MBIA	A/NR	4.000	09/01/2018		250,000		247,495
Johnson Cty., KS Community College Student Commons & Parking AMBAC	Aa-3/AA+	5.000	11/15/2019		235,000		246,327
Johnson Cty., KS USD #232 (Desoto) FSA	Aaa/NR	5.000	09/01/2015		100,000		109,120
Kansas City, KS Util. Syst. Ref. & Impvt. AMBAC	Aa-3/AA	6.300	09/01/2016		200,000		200,042
KS Devl. Finance Auth. (Dept. Admin. 7th & Harrison PJ) AMBAC	Aa-3/AA	5.500	12/01/2013		375,000		393,214
KS Devl. Finance Auth. (Sec. 8) Rev. Ref. MBIA	A/AA	6.400	01/01/2024		255,000		255,000
KS Devl. Finance Auth. (Wichita Univ.) AMBAC	Aa-3/AA	5.900	04/01/2015		305,000		319,969
KS Devl. Finance Auth. (Water Pollution Control) Rev.	Aaa/AAA	5.250	05/01/2011		380,000		383,371
KS Devl. Finance Auth. (KS St. Projects) Rev. MBIA	A/AA	5.000	10/01/2017		250,000		263,360
KS Devl. Finance Auth. (State of KS Projects) MBIA	Aa/AA	4.100	05/01/2019		250,000		248,850
KS Devl. Finance Auth. (Park Apts.) Multifamily Hsg. Rev. FNMA	NR/AAA	5.700	12/01/2009		170,000		170,425
*KS Devl. Finance Auth. (Stormont Vail) Hlth. Care Rev. MBIA	A/AA	5.750	11/15/2012		595,000		644,135
KS Turnpike Auth. Rev. FSA	Aaa/AAA	5.000	09/01/2024		200,000		206,734
Kingman Cty., KS USD #331 FGIC	NR/NR	5.500	10/01/2012		250,000		265,280
Leavenworth Cty., KS USD# 458 FSA	NR/AAA	4.500	09/01/2028		250,000		239,017
*Mission, KS Multifamily Hsg. (Lamar Place) Rev. FNMA	NR/AAA	5.000	10/01/2014		605,000		605,587
#Mission, KS Multifamily Hsg. (Lamar Place) Rev. FNMA	NR/AAA	5.180	10/01/2023		445,000		431,107
Morton Cty., KS USD #217 FSA	Aaa/AAA	4.000	09/01/2010		100,000		100,053
Olathe, KS Multifamily Hsg. (Bristol Pointe) Rev. Ref. FNMA	NR/AAA	5.250	11/01/2012		445,000		445,196
Saline Cty., KS USD #305 (Salina) G.O. Ref. FSA	Aaa/NR	5.500	09/01/2015		190,000		204,064
Sedgwick County KS UNI School Dist. # 262 Assumed Guaranty	NR/AAA	5.000	09/01/2018		100,000		107,608
Sedgwick Cty., KS USD #265 (Goddard) Assured GTY	Aaa/NR	4.500	10/01/2026		250,000		245,165
Shawnee Cty., KS USD #437 (Auburn-Washburn) G.O. Ref. FSA	Aaa/NR	5.000	09/01/2014		485,000		513,896
*Shawnee, KS Multifamily Hsg. (Thomasbrooks Apts.) Rev. FNMA COL.	NR/AAA	5.250	10/01/2014		185,000		187,076
*University of Kansas Hosp. Auth. AMBAC	Aa-3/AAA	5.500	09/01/2015		750,000		779,580
Washburn Univ. (Living Learning Ctr.) Bldg. Rev. AMBAC	Aa-3/AA	5.350	07/01/2011		105,000		108,353
Washburn Univ. (Living Learning Ctr.) Bldg. Rev. AMBAC	Aa-3/NR	5.000	07/01/2019		255,000		269,851
Wichita, KS GO AMBAC	Aa/AA+	4.500	09/01/2022		150,000		148,988
Wichita, KS GO AMBAC	Aa/AA+	4.750	09/01/2027		180,000		179,003
# Wichita, KS Multifamily Hsg. (Broadmoor Chelsea) Rev. FNMA	NR/AAA	5.375	07/01/2010		200,000		200,670
*Wichita, KS Multifamily Hsg. (Cimarron Apartments) FNMA	NR/AAA	5.250	10/01/2012		320,000		320,294
Wichita, KS Water & Sewer Util. Rev. FGIC	A-1/NR	5.250	10/01/2014		75,000		81,020
Wyandotte Cty, KS. GO FSA	Aaa/AAA	5.000	08/01/2025		250,000		256,373
#Wyandotte Cty., KS City, KS Gov't. Util. Syst. Rev. MBIA	A-1/AA	5.125	09/01/2013		500,000		514,585
Wyandotte Cty., KS USD #500 G.O. FSA	Aaa/AAA	5.250	09/01/2013		250,000		273,915
TOTAL KANSAS MUNICIPAL BONDS (COST: $11,644,968)						$	11,885,622
SHORT-TERM SECURITIES (3.1%)					Shares
Wells Fargo Advantage National Tax-Free Money Market (COST: $379,350)					379,350	$	379,350
TOTAL INVESTMENTS IN SECURITIES (COST: $12,024,318)						$	12,264,972
OTHER ASSETS LESS LIABILITIES							95,163
NET ASSETS						$	12,360,135

*Indicates bonds are segregated by the custodian to cover when-issued or delayed-delivery purchases.

#Indicates bonds are segregated by the custodian to cover initial margin requirements.

Footnote: Non-rated (NR) securities have been determined to be of investment grade quality by the Fund's Manager.

Various inputs are used in determining the value of the Fund's investments. These inputs are summarized in three broad levels:

Level 1—	quoted prices in active markets for identical securities
Level 2—	other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risks, etc.)
Level 3—	significant unobservable inputs (including the Fund's own assumptions in determining the fair value of investments)

The following is a summary of the inputs used to value the Fund's investments as of July 31, 2008:

Valuation Inputs	Investments in Securities
Level 1—Quoted Prices	$	379,350
Level 2—Other Significant Observable Inputs		11,885,622
Level 3—Significant Unobservable Inputs		—
Total	$	12,264,972

The accompanying notes are an integral part of these financial statements.

Financial Statements July 31, 2008

Statement of Assets and Liabilities

July 31, 2008

ASSETS
	Investments in securities, at value (cost: $12,024,318)		$	12,264,972
	Accrued interest receivable			195,638
	Accrued dividends receivable			628
	Receivable from manager			4,837
	Prepaid expenses			1,237
		Total Assets	$	12,467,312
LIABILITIES
	Disbursements in excess of demand deposit cash		$	45,312
	Dividends payable			39,360
	Accrued expenses			15,738
	Payable to affiliates			6,767
		Total Liabilities	$	107,177
NET ASSETS			$	12,360,135
Net assets are represented by:
	Paid-in capital		$	13,434,203
	Accumulated undistributed net realized gain (loss) on investments and futures			(1,315,125)
	Accumulated undistributed net investment income (loss)			403
	Unrealized appreciation (depreciation) on investments			240,654
		Total amount representing net assets applicable to 1,129,930 outstanding shares of no par common stock (unlimited shares authorized)	$	12,360,135
Net asset value per share			$	10.94
Public offering price (based on sales charge of 2.75%)			$	11.25

The accompanying notes are an integral part of these financial statements.

>Financial Statements July 31, 2008

Statement of Operations

For the year ended July 31, 2008

INVESTMENT INCOME
	Interest		$	511,429
	Dividends			15,562
		Total Investment Income	$	526,991
EXPENSES
	Investment advisory fees		$	57,110
	Administrative service fees			24,001
	Transfer agent fees			24,181
	Accounting service fees			29,711
	Custodian fees			2,673
	Professional fees			8,576
	Trustees fees			2,354
	Insurance expense			273
	Reports to shareholders			1,804
	Audit fees			6,576
	Legal fees			9,031
	Transfer agent out-of-pockets			1,163
	License, fees, and registrations			1,729
		Total Expenses	$	169,182
	Less expenses waived or absorbed by the Fund's manager			(83,516)
		Total Net Expenses	$	85,666
NET INVESTMENT INCOME (LOSS)			$	441,325
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
	Net realized gain (loss) from investment transactions		$	1,070
	Net change in unrealized appreciation (depreciation) of investments			55,789
		Net Realized and Unrealized Gain (Loss) on Investments	$	56,859
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS			$	498,184

The accompanying notes are an integral part of these financial statements.

Financial Statements July 31, 2008

Statement of Changes in Net Assets

For the year ended July 31, 2008 and the year ended July 31, 2007

			For The Year Ended July 31, 2008		For The Year Ended July 31, 2007
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
	Net investment income (loss)		$	441,325	$	475,082
	Net realized gain (loss) on investment transactions			1,070		24,918
	Net change in unrealized appreciation (depreciation) on investments			55,789		(96,950)
		Net Increase (Decrease) in Net Assets Resulting From Operations	$	498,184	$	403,050
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
	Dividends from net investment income ($.42 and $.44 per share, respectively)		$	(441,023)	$	(474,981)
	Distributions from net realized gain on investment transactions ($.00 and $.00 per share, respectively)			0		0
		Total Dividends and Distributions	$	(441,023)	$	(474,981)
CAPITAL SHARE TRANSACTIONS
	Proceeds from sale of shares		$	2,265,530	$	868,389
	Proceeds from reinvested dividends			323,079		313,886
	Cost of shares redeemed			(971,748)		(2,842,925)
		Net Increase (Decrease) in Net Assets Resulting from Capital Share Transactions	$	1,616,861	$	(1,660,650)
TOTAL INCREASE (DECREASE) IN NET ASSETS			$	1,674,022	$	(1,732,581)
NET ASSETS, BEGINNING OF PERIOD				10,686,113		12,418,694
NET ASSETS, END OF PERIOD			$	12,360,135	$	10,686,113
Undistributed Net Investment Income			$	402	$	101

The accompanying notes are an integral part of these financial statements.

Notes to Financial Statements July 31, 2008

Note 1. ORGANIZATION

The Fund is an investment portfolio of Integrity Managed Portfolios (the "Trust") and is registered under the Investment Company Act of 1940, as amended (the "1940 Act") as a non-diversified, open-end management investment company. The Trust may offer multiple portfolios; currently six portfolios are offered. The Trust is an unincorporated business trust organized under Massachusetts law on August 10, 1990. The Fund had no operations from that date to November 23, 1992, other than matters relating to organization and registration. On November 23, 1992, the Fund commenced its Public Offering of capital shares.

The investment objective of the Fund is to provide its shareholders with as high a level of current income exempt from both federal and Kansas state income tax as is consistent with preservation of capital. The Fund will seek to achieve this objective by investing primarily in a portfolio of Kansas municipal securities.

Shares of the Fund are offered at net asset value plus a maximum sales charge of 2.75% of the offering price.

Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Investment security valuation—Securities for which quotations are not readily available (which will constitute a majority of the securities held by the Fund) are valued using a matrix system at fair value as determined by Integrity Money Management. The matrix system has been developed based on procedures approved by the Board of Trustees and includes consideration of the following:

• yields or prices of municipal bonds of comparable quality;

• type of issue, coupon, maturity, and rating;

• indications as to value from dealers; and

• general market conditions.

Because the market value of securities can only be established by agreement between parties in a sales transaction, and because of the uncertainty inherent in the valuation process, the fair values as determined may differ from the values that would have been used had a ready market for the securities existed. The Fund follows industry practice and records security transactions on the trade date.

The Fund concentrates its investments in a single state. This concentration may result in the Fund investing a relatively high percentage of its assets in a limited number of issuers.

When-issued securities—The Fund may purchase securities on a when-issued basis. Payment and delivery may take place after the customary settlement period for that security. The price of the underlying securities and the date when the securities will be delivered and paid for are fixed at the time the transaction is negotiated. The value of the securities purchased on a when-issued basis are identified as such in the Fund's Schedule of Investments. With respect to purchase commitments, the Fund identifies securities as segregated in its records with a value at least equal to the amount of the commitment. Losses may arise due to changes in the value of the underlying securities or if the counterparty does not perform under the contract's terms, or if the issuer does not issue the securities due to political, economic, or other factors.

Federal and state income taxes—The Fund's policy is to comply with the requirements of the Internal Revenue Code that are applicable to regulated investment companies and to distribute all of its net investment income and any net realized gain on investments to its shareholders. Therefore, no provision for income taxes is required.

In June 2006, the Financial Accounting Standards Board ("FASB") issued Interpretation No. 48, "Accounting for Uncertainty in Income Taxes" ("FIN 48"). FIN 48 establishes the minimum threshold for recognizing, and a system for measuring, the benefits of tax-return positions in financial statements. Management has analyzed the Fund's tax positions taken on federal income tax returns for all open tax years (tax years ended July 31, 2004 through July 31, 2008) for purposes of implementing FIN 48, and has concluded that no provision for income tax is required in the Fund's financial statements. Interest and penalties related to uncertain tax positions, if any, are classified in the Fund's financial statements as other expense.

The tax character of distributions paid was as follows:

			July 31, 2008		July 31, 2007
Tax-exempt income		$	441,023	$	474,981
Ordinary income			0		0
Long-term capital gains			0		0
	Total	$	441,023	$	474,981

As of July 31, 2008, the components of accumulated earnings/(deficit) on a tax basis were as follows:

Undistributed Ordinary Income	Undistributed Long-Term Capital Gains	Undistributed Accumulated Earnings	Accumulated Capital and Other Losses	Unrealized Appreciation/ (Depreciation)	Total Accumulated Earnings/(Deficit)
$0	$0	$0	($1,315,125)	$241,057	($1,074,068)

The Fund has unexpired capital loss carryforwards for tax purposes as of July 31, 2008 totaling $1,315,125, which may be used to offset capital gains. Any difference between book-basis and tax-basis unrealized appreciation/(depreciation) is attributable to timing differences associated with market discount. The capital loss carryforward amounts will expire in each of the years ended July 31 as shown in the table below.

Year	Unexpired Capital Losses
2009	$78,788
2010	$178,976
2011	$209,757
2012	$303,542
2013	$544,062

For the year ended July 31, 2008, the Fund made $48,628 in permanent reclassifications to reflect tax character. Reclassifications to paid-in capital relate primarily to expiring capital loss carryforwards.

Net capital losses incurred after October 31 and within the tax year are deemed to arise on the first business day of the Fund's next taxable year. For the year ended July 31, 2008, the Fund did not defer to August 1, 2008, any post-October capital losses, post-October currency losses, or post-October passive foreign investment company losses.

Distributions to shareholders—Dividends from net investment income, declared daily and payable monthly, are reinvested in additional shares of the Fund at net asset value or paid in cash. Capital gains, when available, are distributed at least annually.

Premiums and discounts—Premiums and discounts on municipal securities are amortized for financial reporting purposes.

Other—Income and expenses are recorded on the accrual basis. Investment transactions are accounted for on the trade date. Realized gains and losses are reported on the identified cost basis. Distributions to shareholders are recorded by the Fund on the ex-dividend date. Income and capital gain distributions are determined in accordance with federal income tax regulations and may differ from net investment income and realized gains determined in accordance with accounting principles generally accepted in the >United States of America. These differences are primarily due to differing treatments for market discount, capital loss carryforwards, and losses due to wash sales and futures transactions.

Permanent book and tax basis differences relating to shareholder distributions will result in reclassifications to paid-in capital. Temporary book and tax basis differences will reverse in a subsequent period.

Futures contracts—The Fund may purchase and sell financial futures contracts to hedge against changes in the values of tax-exempt municipal securities the Fund owns or expects to purchase.

A futures contract is an agreement between two parties to buy or sell units of a particular index or a certain amount of U.S. government or municipal securities at a set price on a future date. Upon entering into a futures contract, the Fund is required to deposit with a broker an amount of cash or securities equal to the minimum "initial margin" requirement of the futures exchange on which the contract is traded. Subsequent payments ("variation margin") are made or received by the Fund, dependent on the fluctuations in the value of the underlying index. Daily fluctuations in value are recorded for financial reporting purposes as unrealized gains or losses by the Fund. When entering into a closing transaction, the Fund will realize, for book purposes, a gain or loss equal to the difference between the value of the futures contracts sold and the futures contracts to buy. Unrealized appreciation (depreciation) related to open futures contracts is required to be treated as realized gain (loss) for federal income tax purposes.

Securities held in collateralized accounts to cover initial margin requirements on open futures contracts are noted in the Schedule of Investments. The Statement of Assets and Liabilities reflects a receivable or payable for the daily mark to market for variation margin.

Certain risks may arise upon entering into futures contracts. These risks may include changes in the value of the futures contracts that may not directly correlate with changes in the value of the underlying securities.

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

Note 3. CAPITAL SHARE TRANSACTIONS

As of July 31, 2008, there were unlimited shares of no par authorized; 1,129,930 and 982,925 shares were outstanding at July 31, 2008 and July 31, 2007, respectively.

Transactions in capital shares were as follows:

	Shares
	For The Year Ended July 31, 2008	For The Year Ended July 31, 2007
Shares sold	206,132	79,386
Shares issued on reinvestment of dividends	29,527	28,663
Shares redeemed	(88,654)	(259,480)
Net increase (decrease)	147,005	(151,431)

Note 4. INVESTMENT ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES

Integrity Money Management, the Fund's investment adviser; Integrity Funds Distributor, the Fund's underwriter; and Integrity Fund Services, Inc. ("Integrity Fund Services"), the Fund's transfer, accounting, and administrative services agent; are subsidiaries of Integrity Mutual Funds, the Fund's sponsor.

The Fund has engaged Integrity Money Management to provide investment advisory and management services to the Fund. The Investment Advisory Agreement provides for fees to be computed at an annual rate of 0.50% of the Fund's average daily net assets. All investment advisory fees were waived for the year ended July 31, 2008. Certain Officers and Trustees of the Fund are also Officers and Directors of Integrity Money Management.

Under the terms of the advisory agreement, Integrity Money Management has agreed to pay all the expenses of the Fund (excluding taxes and brokerage fees and commissions, if any) that exceed 0.75% of the Fund's average daily net assets on an annual basis. Integrity Money Management may also voluntarily waive fees or reimburse expenses not required under the advisory agreement from time to time. Accordingly, after fee waivers and expense reimbursements, the Fund's actual total annual operating expenses were 0.75% for the year ended July 31, 2008.

Shareholder services

Integrity Fund Services, the transfer agent, provides shareholder services for a variable fee equal to 0.20% of the Fund's average daily net assets on an annual basis for the Fund's first $50 million and at a lower rate on the average daily net assets in excess of $50 million, with a minimum of $2,000 per month plus reimbursement of out-of-pocket expenses. An additional fee of $500 per month is charged for each additional share class. The Fund has recognized $24,181 of transfer agency fees and expenses for the year ended July 31, 2008. The Fund has a payable to Integrity Fund Services of $2,080 at July 31, 2008 for transfer agency fees. Integrity Fund Services also acts as the Fund's accounting services agent for a monthly fee equal to the sum of a fixed fee of $2,000 and a variable fee equal to 0.05% of the Fund's average daily net assets on an annual basis for the Fund's first $50 million and at a lower rate on the average daily net assets in excess of $50 million, together with reimbursement of out-of-pocket expenses. An additional minimum fee of $500 per month is charged by Integrity Fund Services for each additional share class. The Fund has recognized $29,711 of accounting service fees for the year ended July 31, 2008. The Fund has a payable to Integrity Fund Services of $2,520 at July 31, 2008 for accounting service fees. Integrity Fund Services also acts as the Fund's administrative services agent for a variable fee equal to 0.125% of the Fund's average daily net assets on an annual basis for the Fund's first $50 million and at a lower rate on the average daily net assets in excess of $50 million, with a minimum of $2,000 per month plus out-of-pocket expenses. An additional fee of $500 per month is charged by Integrity Fund Services for each additional share class. The Fund has recognized $24,001 of administrative service fees for the year ended July 31, 2008. The Fund has a payable to Integrity Fund Services of $2,000 at July 31, 2008 for administrative service fees.

Note 5. INVESTMENT SECURITY TRANSACTIONS

The cost of purchases and proceeds from the sales of investment securities (excluding short-term securities) aggregated $3,855,920 and $2,355,000, respectively, for the year ended July 31, 2008.

Note 6. INVESTMENT IN SECURITIES

At July 31, 2008, the aggregate cost of securities for federal income tax purposes was substantially the same for financial reporting purposes at $12,024,318. The net unrealized appreciation of investments based on the cost was $240,654, which is comprised of $275,472 aggregate gross unrealized appreciation and $34,818 aggregate gross unrealized depreciation. Differences between financial reporting-basis and tax-basis unrealized appreciation/(depreciation) are due to differing treatment of market discount.

Note 7. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In September 2006, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards (SFAS) No. 157 Fair Value Measurements. This standard defines fair value, and establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands disclosures about fair value measurements. The standard is effective for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years.

In accordance with the provisions of SFAS No. 157, the Fund adopted this standard during the current fiscal year. The implementation of the standard did not impact the amounts reported in the financial statements.

In March 2008, FASB issued SFAS No. 161 Disclosures about Derivative Instruments and Hedging Activities. This standard requires enhanced disclosures to provide information about the reasons the Fund invests in derivative instruments, the accounting treatment and the effect derivatives have on financial performance. The standard is effective for fiscal years beginning after November 15, 2008, and interim periods within those fiscal years. Management is currently evaluating the impact the adoption of SFAS No. 161 will have on the Fund's financial statement disclosures.

Financial Highlights July 31, 2008

Selected per share data and ratios for the periods indicated

					For The Year Ended July 31, 2008		For The Year Ended July 31, 2007		For The Year Ended July 31, 2006		For The Year Ended July 29, 2005		For The Year Ended July 30, 2004
NET ASSET VALUE, BEGINNING OF PERIOD				$	10.87	$	10.95	$	10.94	$	11.44	$	11.60
Income from Investment Operations:
	Net investment income (loss)			$	.42	$	.44	$	.43	$	.42	$	.43
	Net realized and unrealized gain (loss) on investment and futures transactions				.07		(.08)		.01		(.50)		(.16)
		Total Income (Loss) From Investment Operations		$	.49	$	.36	$	.44	$	(.08)	$	.27
Less Distributions:
	Dividends from net investment income			$	(.42)	$	(.44)	$	(.43)	$	(.42)	$	(.43)
	Distributions from net realized gains				.00		.00		.00		.00		.00
			Total Distributions	$	(.42)	$	(.44)	$	(.43)	$	(.42)	$	(.43)
NET ASSET VALUE, END OF PERIOD				$	10.94	$	10.87	$	10.95	$	10.94	$	11.44
Total Return					4.62%(A)		3.34%(A)		4.06%(A)		(0.75%)(A)		2.31%(A)
RATIOS/SUPPLEMENTAL DATA:
	Net assets, end of period (in thousands)			$	12,360	$	10,686	$	12,419	$	14,480	$	16,982
	Ratio of net expenses (after expense assumption) to average net assets				0.75%(B)		0.75%(B)		0.75%(B)		0.75%(B)		0.75%(B)
	Ratio of net investment income to average net assets				3.86%		4.02%		3.89%		3.71%		3.67%
	Portfolio turnover rate				21.80%		9.18%		4.15%		1.81%		4.39%

^(A)Excludes maximum sales charge of 2.75%.

^(B)During the periods indicated above, Integrity Money Management assumed and/or waived expenses of $83,516, $77,248, $62,295, $57,567, and $58,289, respectively. If the expenses had not been assumed and/or waived, the annualized ratio of total expenses to average net assets would have been 1.48%, 1.40%, 1.23%, 1.10%, and 1.08%, respectively.

Total return represents the rate that an investor would have earned or lost on an investment in the Fund assuming reinvestment of all dividends and distributions.

The accompanying notes are an integral part of these financial statements.

Tax Information for the Year Ended July 31, 2008 (Unaudited)

We are required to advise you within 60 days of the Fund's fiscal year regarding the federal tax status of distributions received by shareholders during such fiscal year. The distributions made during the fiscal year by the Fund were earned from the following sources:

		Dividends and Distributions Per Share
To Shareholders of Record	Payment Date		From Net Investment Income	From Net Realized Short-Term Gains	From Net Realized Long-Term Gains
August 31, 2007	August 31, 2007	$	.037083	.0	.0
September 28, 2007	September 28, 2007	$	.034591	.0	.0
October 31, 2007	October 31, 2007	$	.038584	.0	.0
November 30, 2007	November 30, 2007	$	.034860	.0	.0
December 31, 2007	December 31, 20007	$	.035329	.0	.0
January 31, 2008	January 31, 2008	$	.035212	.0	.0
February 29, 2008	February 29, 2008	$	.035215	.0	.0
March 31, 2008	March 31, 2008	$	.035117	.0	.0
April 30, 2008	April 30, 2008	$	.035159	.0	.0
May 30, 2008	May 30, 2008	$	.034450	.0	.0
June 30, 2008	June 30, 2008	$	.034151	.0	.0
July 31, 2008	July 31, 2008	$	.034604	.0	.0

Shareholders should consult their tax advisors.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Trustees of the Kansas Insured Intermediate Fund

We have audited the accompanying statement of assets and liabilities of the Kansas Insured Intermediate Fund (one of the portfolios constituting the Integrity Managed Portfolios), including the schedule of investments as of July 31, 2008, the related statement of operations for the year then ended, the statement of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended. These financial statements and financial highlights are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of July 31, 2008 by correspondence with the custodian and brokers. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Kansas Insured Intermediate Fund of the Integrity Managed Portfolios as of July 31, 2008, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.

BRADY, MARTZ & ASSOCIATES, P.C.

Minot, North Dakota USA

September 12, 2008

Dear Shareholder:

Enclosed is the annual report of the Maine Municipal Fund (the "Fund") for the year ended July 31, 2008. The Fund's portfolio and related financial statements are presented within for your review.

As we end the year, what one might have thought was an uneventful year was much the opposite.

First, interest rates spiked higher early in June as Federal Reserve Chairman Ben Bernanke voiced concern about inflation and the slumping dollar. However, a string of weak economic reports in the last part of June (consumer confidence plunged to its lowest level since 1992) along with more losses and downgrades in the banking sector, reduced corporate earnings expectations as well as higher energy prices have encouraged market participants to dump stocks in favor of low-risk government bonds, sending the 10-year treasury to 3.95%

Second, while the market likes to talk about light at the end of the tunnel, unfortunately in these days of financial turmoil we can never be sure whether it is light from the other side or another freight train coming. Most recently, Fannie Mae and Freddie Mac who own or guarantee nearly half of the $12 trillion mortgage market have seen their company stocks fall 75-80% year-to-date, as the worst housing downturn since the Great Depression impacted expected solvency levels.

Municipals on the other hand didn't fare any better as a number of the secondary insurers saw significant downgrades of their ratings, the collapse of major financial institution Bear Stearns and the exit of UBS from the municipal bond market.

The secondary insurers of municipal debt are in turmoil as a number of the insurance companies are in dire straits. Many bond professionals and investors, who in the past treated all insured bonds equal from a credit perspective, now understand the importance of the underlying credit, the purpose of the debt issued, and its commitment to pay. Currently there are three insurers of municipal debt that have AAA ratings from all three rating agencies and two of those three insurers are on Credit Watch for possible downgrade.

These events have created great uncertainty and with that, opportunity. It is now a buyers market as high quality municipals are yielding in many instances, yields higher than taxable treasuries of similar maturities. Clearly there will be price rallies and price sell offs in the months ahead, but the underlying tone for tax-free municipals is bullish.

The Maine Municipal Fund began the period at $10.45 and ended the period at $10.44 for a total return of 3.43%*. This compares to the Lehman Brothers Municipal Bond Index return of 2.84%.

The Fund's yearly overall performance can be attributed to its defensive portfolio, with an average maturity of 12.4 years and an average maturity to the first call date of 4.3 years. That, along with an average portfolio coupon of 5.15% helps relative performance in volatile environments.

An important part of the Fund's strategy includes searching the primary and secondary markets for high quality, double tax-exempt issues. Some purchases made throughout the year include: Westbrook General Obligation, 3.25% coupon, due 2009; Maine Health & Higher Ed, 5.00% coupon, due 2022; Windham General Obligation, 3.125% coupon, due 2010; and Lewistown General Obligation, 4.50% coupon, due 2025.

Portfolio quality at year-end was as follows: AAA 42.5%, AA 40.9%, A 16.1% and BBB 0.5%.

Income exempt from federal and Maine state income taxes with preservation of capital remain the primary objectives of the Fund.

If you would like more frequent updates, visit the Fund's website at www.integrityfunds.com for daily prices along with pertinent Fund information.

Sincerely,

Monte Avery
Senior Portfolio Manager

The views expressed are those of Monte Avery, Senior Portfolio Manager with Integrity Mutual Funds, Inc. ("Integrity Mutual Funds"). The views are subject to change at any time in response to changing circumstances in the market and are not intended to predict or guarantee the future performance of any individual security, market sector, the markets generally, or any Integrity Mutual Fund.

*Performance does not include applicable front-end or contingent deferred sales charges ("CDSCs"), which would have reduced the performance.

Performance data quoted above is historical. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. The principal value and investment return of an investment will fluctuate so that your shares, when redeemed, may be worth more or less than the original cost. You can obtain performance data current to the most recent month end (available within seven business days of the most recent month end) by calling 800-276-1262.

You should consider the Fund's investment objectives, risks, charges, and expenses carefully before investing. For this and other important information, please obtain a Fund prospectus at no cost from your financial adviser and read it carefully before investing.

Bond prices and, therefore, the value of bond funds decline as interest rates rise. Because the Fund invests in securities of a single state, the Fund is more susceptible to factors adversely impacting the respective state securities more so than a municipal bond fund that does not concentrate its securities in a single state.

July 31, 2008 (Unaudited)

PROXY VOTING OF FUND PORTFOLIO SECURITIES

A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to securities held in the Fund's portfolio is available, without charge and upon request, by calling 800-276-1262. A report on Form N-PX of how the Fund voted any such proxies during the most recent twelve-month period ended June 30 is available through the Fund's website at www.integrityfunds.com. The information is also available from the Electronic Data Gathering, Analysis, and Retrieval ("EDGAR") database on the website of the Securities and Exchange Commission ("SEC") at www.sec.gov.

QUARTERLY PORTFOLIO SCHEDULE

Within 60 days of the end of its second and fourth fiscal quarters, the Fund provides a complete schedule of portfolio holdings in its semi-annual and annual reports on the Form N-CSR(S). These reports are filed electronically with the SEC and are delivered to the shareholders of the Fund. The Fund also files its 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 Forms N-Q and N-CSR(S) are available on the SEC's website at www.sec.gov. The Fund's Forms N-Q and N-CSR(S) 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 202-942-8090. You may also access this information from the Fund's website at www.integrityfunds.com.

SHAREHOLDER INQUIRIES AND MAILINGS

All inquiries regarding the Fund should be directed to:

Integrity Funds Distributor, Inc.
1 Main Street North
Minot, ND 58703
Phone: 800-276-1262

All inquiries regarding account information should be directed to:

Integrity Fund Services, Inc.
P.O. Box 759
Minot, ND 58702
Phone: 800-601-5593

To reduce expenses, the Fund may only mail one copy of its prospectus and each annual and semi-annual report to those addresses shared by two or more accounts. If you wish to receive individual copies of these documents, please call Integrity Funds Distributor, Inc. ("Integrity Funds Distributor") at 800-276-1262 (or contact your financial institution). Individual copies will be sent thirty days after receiving your request.

Terms & Definitions July 31, 2008 (Unaudited)

Appreciation

Increase in the value of an asset

Average Annual Total Return

A standardized measurement of the return (yield and appreciation) earned by a fund on an annual basis assuming all distributions are reinvested

Coupon Rate or Face Rate

Rate of interest payable annually based on the face amount of the bond; expressed as a percentage

Depreciation

Decrease in the value of an asset

Lehman Brothers Municipal Bond Index

An unmanaged list of long-term, fixed-rate, investment-grade, tax-exempt bonds representative of the municipal bond market; the index does not take into account brokerage commissions or other costs, may include bonds different from those in the Fund, and may pose different risks than the Fund

Market Value

Actual (or estimated) price at which a bond trades in the marketplace

Maturity

A measure of the term or life of a bond in years; when a bond "matures", the issuer repays the principal

Net Asset Value

The value of all of a fund's assets, minus any liabilities, divided by the number of outstanding shares, not including any initial sales charge

Quality Ratings

A designation assigned by independent rating companies to give a relative indication of a bond's creditworthiness; "AAA," "AA," "A," and "BBB" indicate investment grade securities. Ratings can range from a high of "AAA" to a low of "D".

Total Return

Measures both the net investment income and any realized and unrealized appreciation or depreciation of the underlying investments in a fund's portfolio for the period, assuming the reinvestment of all dividends; represents the aggregate percentage or dollar value change over the period

July 31, 2008 (Unaudited)

COMPOSITION

Portfolio Quality Ratings
(Based on total long-term investments)

AAA	42.5%
AA	40.9%
A	16.1%
BBB	0.5%

Quality ratings reflect the financial strength of the issuer. They are assigned by independent ratings services such as Moody's Investors Services and Standard & Poor's Ratings Group. Non-rated bonds have been determined to be of appropriate quality for the portfolio by Integrity Money Management, Inc. ("Integrity Money Management"), the Fund's investment adviser.

These percentages are subject to change.

Portfolio Market Sectors
(As a percentage of Net Assets)

T—Transportation	35.2%
I—Industrial	21.0%
G—Government	14.8%
H—Health	8.0%
O—Other	7.4%
S—School	5.5%
U—Utilities	4.3%
W/S—Water/Sewer	3.8%

Market sectors are breakdowns of the Fund's portfolio holdings into specific investment classes.

These percentages are subject to change.

July 31, 2008 (Unaudited)

DISCLOSURE OF FUND EXPENSES

The example below is intended to describe the fees and expenses borne by shareholders and the impact of those costs on your investment.

EXAMPLE

As a shareholder of the Fund, you incur two types of costs:

•	transaction costs:	sales charges (loads), redemption fees, and exchange fees
•	ongoing costs:	management fees, distribution (12b-1) fees, and other Fund expenses

This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period from January 31, 2008 to July 31, 2008.

The example illustrates the Fund's costs in two ways:

Actual expenses

The section in the table under the heading "Actual" provides information about actual account values and actual expenses. You may use the information in these columns together with the amount you invested to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an account value of $8,600 divided by $1,000 equals 8.6), then multiply the result by the number in the column entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period.

Hypothetical example for comparison purposes

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

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees, or exchange fees. Therefore, the section in the table under the heading "Hypothetical (5% return before expenses)" is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

	Beginning Account Value 01/31/08	Ending Account Value 07/31/08		Expenses Paid During Period*
Actual	$1,000.00	$	987.19	$5.32
Hypothetical (5% return before expenses)	$1,000.00	$	1,019.51	$5.34

*Expenses are equal to the annualized expense ratio of 1.07%, multiplied by the average account value over the period, multiplied by 180/360 days. The Fund's ending account value on the first line in the table is based on its actual total return of (1.28%) for the six-month period of January 31, 2008 to July 31, 2008.

July 31, 2008 (Unaudited)

AVERAGE ANNUAL TOTAL RETURNS

		For periods ending July 31, 2008
Maine Municipal Fund		1 year	3 year	5 year	10 year	Since Inception (December 5, 1991)
	Without Sales Charge	3.43%	3.48%	2.71%	3.53%	4.79%
	With Sales Charge (4.25%)	(0.94%)	2.00%	1.83%	3.08%	4.52%
Lehman Brothers Municipal Bond Index		1 year	3 year	5 year	10 year	Since Inception (December 5, 1991)
		2.84%	3.22%	4.35%	4.92%	5.99%

Putting Performance into Perspective

Performance data quoted above is historical. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. The principal value and investment return of an investment will fluctuate so that your shares, when redeemed, may be worth more or less than the original cost. You can obtain performance data current to the most recent month end (available within seven business days of the most recent month end) by calling 800-276-1262.

You should consider the Fund's investment objectives, risks, charges, and expenses carefully before investing. For this and other important information, please obtain a Fund prospectus at no cost from your financial adviser and read it carefully before investing.

The table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions and redemption of Fund shares.

The Fund's performance prior to December 19, 2003 was achieved while the Fund was managed by another investment adviser that used different investment strategies and techniques, which may have produced different investment results than those achieved by the current investment adviser. Forum Investment Advisors, LLC served as investment adviser to the Fund until December 19, 2003.

July 31, 2008 (Unaudited)

COMPARATIVE INDEX GRAPH

Comparison of change in value of a $10,000 investment in the Fund and the Lehman Brothers Municipal Bond Index

	Maine Municipal Fund without Sales Charge		Maine Municipal Fund with Maximum Sales Charge		Lehman Brothers Municipal Bond Index
7/31/98	$	10,000	$	9,575	$	10,000
1999	$	10,267	$	9,832	$	10,288
2000	$	10,659	$	10,206	$	10,732
2001	$	11,504	$	11,016	$	11,815
2002	$	12,099	$	11,585	$	12,608
2003	$	12,369	$	11,844	$	13,061
2004	$	12,858	$	12,312	$	13,816
2005	$	12,762	$	12,221	$	14,695
2006	$	13,288	$	12,724	$	15,071
2007	$	13,672	$	13,091	$	15,713
7/31/08	$	14,140	$	13,540	$	16,160

Putting Performance into Perspective

Performance data quoted above is historical. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. The principal value and investment return of an investment will fluctuate so that your shares, when redeemed, may be worth more or less than the original cost. You can obtain performance data current to the most recent month end (available within seven business days of the most recent month end) by calling 800-276-1262.

You should consider the Fund's investment objectives, risks, charges, and expenses carefully before investing. For this and other important information, please obtain a Fund prospectus at no cost from your financial adviser and read it carefully before investing.

The graph does not reflect the deduction of taxes that a shareholder would pay on Fund distributions and redemptions of Fund shares.

The graph comparing the Fund's performance to a benchmark index provides you with a general sense of how the Fund performed. To put this information in context, it may be helpful to understand the special differences between the two. The Lehman Brothers Municipal Bond Index is a national index representative of the national municipal bond market, whereas the Fund concentrates its investments in Maine municipal bonds. The Fund's total return for the periods shown appears with and without sales charges and includes Fund expenses and management fees. A securities index measures the performance of a theoretical portfolio. Unlike a fund, the index is unmanaged; there are no expenses that affect the results. In addition, few investors could purchase all of the securities necessary to match the index. If they could, they would incur transaction costs and other expenses. All Fund and benchmark returns include reinvested dividends.

July 31, 2008 (Unaudited)

MANAGEMENT OF THE FUND

The Board of the Fund consists of four Trustees. These same individuals, unless otherwise noted, also serve as Directors or Trustees for all of the funds in the Integrity family of funds, the six series of Integrity Managed Portfolios, and the three series of The Integrity Funds. Three Trustees (75% of the total) have no affiliation or business connection with Integrity Money Management or any of its affiliates; these are the "Independent" Trustees. Two of the remaining three Trustees and/or Officers are "interested" by virtue of their affiliation with Integrity Money Management and/or its affiliates.

The Independent Trustees of the Fund, their term of office and length of time served, their principal occupation(s) during the past five years, the number of portfolios overseen in the Fund Complex by each Independent Trustee, and other Directorships, if any, held outside the Fund Complex, are shown below.

INDEPENDENT TRUSTEES

NAME, ADDRESS, AND AGE	POSITION(S) HELD WITH REGISTRANT	TERM AND LENGTH SERVED	NUMBER OF PORTFOLIOS OVERSEEN IN THE FUND COMPLEX(1)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS	OTHER DIRECTORSHIPS HELD OUTSIDE THE FUND COMPLEX
Jerry M. Stai 2405 11th Ave. NW Minot, ND 58703 56	Trustee	Indefinite Since January 2006	12	Faculty, Embry-Riddle University (August 2000 to September 2005); Faculty, Park University (August 2005 to December 2005); Non-Profit Specialist, Bremer Bank (since July 2005); Faculty, Minot State University (since August 2000); Director, ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., Integrity Fund of Funds, Inc., (since January 2006); Trustee, The Integrity Funds (since January 2006).	Marycrest Franciscan Development, Inc.
Orlin W. Backes 948 13th Ave. SW Minot, ND 58701 73	Trustee	Indefinite Since January 1996	12	Attorney, McGee, Hankla, Backes & Dobrovolny, P.C.; Director, South Dakota Tax-Free Fund, Inc. (April 1995 to June 2004), ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., and Integrity Fund of Funds, Inc., (since April 2005); Trustee, The Integrity Funds (since June 2003).	First Western Bank & Trust
R. James Maxson 1 N. Main St. Minot, ND 58701 60	Trustee	Indefinite Since January 1999	12	Attorney, Maxson Law Office (since November 2002); Director, South Dakota Tax-Free Fund, Inc. (January 1999 to June 2004), Integrity Fund of Funds, Inc., ND Tax-Free Fund, Inc. and Montana Tax-Free Fund, Inc. (since January 1999); and Trustee, The Integrity Funds (since June 2003).	Vincent United Methodist Foundation Minot Area Development Corporation

⁽¹⁾ The Fund Complex consists of the three incorporated funds in the Integrity family of funds, the six series of Integrity Managed Portfolios, and the three series of The Integrity Funds.

Trustees and officers of the Fund serve until their resignation, removal, or retirement.

The Statement of Additional Information ("SAI") contains more information about the Fund's Trustees and is available without charge upon request, by calling Integrity Funds Distributor at 800-276-1262.

The Interested Trustees and Officers of the Fund, their term of office and length of time served, their principal occupation(s) during the past five years, the number of portfolios overseen in the Fund Complex by each Interested Trustee, and other Directorships, if any, held outside the Fund Complex, are shown below.

INTERESTED TRUSTEE AND OFFICER

NAME, ADDRESS, AND AGE	POSITION(S) HELD WITH REGISTRANT	TERM AND LENGTH SERVED	NUMBER OF PORTFOLIOS OVERSEEN IN THE FUND COMPLEX(1)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS	OTHER DIRECTORSHIPS HELD OUTSIDE THE FUND COMPLEX
Robert E. Walstad(2)(3) 1 N. Main St. Minot, ND 58703 63	Trustee, Chairman, Interim President	Indefinite Since January 1996	12	Director (Sept. 1987 to Feb. 2007), CEO (Sept. 2001 to Feb. 2007), Integrity Mutual Funds; Director, President, and Treasurer, (Aug. 1988 to Feb. 2007), Integrity Money Management; Director, President, and Treasurer (Aug. 1988 to Sept. 2004), ND Capital, Inc.; Director, President, and Treasurer (May 1989 to Feb. 2007), Integrity Fund Services, Inc.; Director, President, CEO, and Treasurer, (Jan. 1996 to Aug. 2003), Integrity Funds Distributor, Inc.; Director, CEO, Chairman, (Jan. 2002 to Feb. 2007) and President (Sept. 2002 to Dec. 2004), Capital Financial Services, Inc.; Director and President, (April 1994 to June 2004) South Dakota Tax-Free Fund, Inc.; President (Jan. 1996 to July 2007) and (since March 2008) Integrity Managed Portfolios, (May 2003 to July 2007) and (since March 2008) The Integrity Funds, (Jan. 1995 to July 2007) and (since March 2008) Integrity Fund of Funds, Inc., (Jan. 1989 to July 2007) and (since March 2008) ND Tax-Free Fund, Inc., (Aug. 1993 to July 2007) and (since March 2008) Montana Tax-Free Fund, Inc.; Director and Chairman Montana Tax-Free Fund, Inc. (since May 1993), Integrity Fund of Funds, Inc. (since Aug. 1994), and ND Tax Free Fund, Inc. (since Oct. 1988); Trustee, Chairman, (since January 1996) and Treasurer (January 1996 to May 2004), Integrity Managed Portfolios; Trustee and Chairman (since June 2003), The Integrity Funds.	Minot Park Board

OFFICERS

NAME, ADDRESS, AND AGE	POSITION(S) HELD WITH REGISTRANT	TERM AND LENGTH SERVED	NUMBER OF PORTFOLIOS OVERSEEN IN THE FUND COMPLEX(1)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS	OTHER DIRECTORSHIPS HELD OUTSIDE THE FUND COMPLEX
Peter A. Quist 1 N. Main St. Minot, ND 58703 74	Vice President, Secretary	Indefinite Since January 1996	3	Attorney; Director and Vice President, Integrity Mutual Funds; Director, Vice President, and Secretary, Integrity Money Management, ND Capital, Inc. (August 1988 to August 2006), Integrity Fund Services, Inc., and Integrity Funds Distributor; Director, Vice President, and Secretary, South Dakota Tax-Free Fund, Inc. (April 1994 to June 2004), Montana Tax-Free Fund, Inc. (since May 1993), Integrity Fund of Funds, Inc. (since Aug. 1994), and ND Tax Free Fund, Inc. (since Oct. 1988); Vice President and Secretary, The Integrity Funds (since June 2003).	None
Adam C. Forthun 1 N. Main St. Minot, ND 58703 32	Treasurer	Indefinite Since May 2008	N/A	Fund Accountant (May 2003 to October 2005), Fund Accounting Supervisor (October 2005 to March 2008), Fund Accounting Manager (since March 2008), Integrity Fund Services, Inc.; Treasurer (since May 2008), Integrity Managed Portfolios, The Integrity Funds, ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., and Integrity Fund of Funds, Inc.	None
Brent M. Wheeler 1 N. Main St. Minot, ND 58703 37	Mutual Fund Chief Compliance Officer	Indefinite Since October 2005	N/A	Fund Accounting Manager (May 1998 to October 2005), Integrity Fund Services, Inc.; Treasurer (May 2004 to October 2005), Mutual Fund Compliance Officer (since October 2005), Integrity Managed Portfolios, The Integrity Funds, ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., and Integrity Fund of Funds, Inc.	None

⁽¹⁾ The Fund Complex consists of the three incorporated funds in the Integrity family of funds, the six series of Integrity Managed Portfolios, and the three series of The Integrity Funds.

⁽²⁾ Trustees and/or Officers who are "interested persons" of the Fund as defined in the Investment Company Act of 1940, as amended (the "1940 Act"). Mr. Quist is an interested person by virtue of being an Officer and Director of the Fund's investment adviser and principal underwriter. Mr. Walstad is an interested person by virtue of being an Officer of the Fund and a shareholder of Integrity Mutual Funds.

⁽³⁾ Effective February 29, 2008, Mark R. Anderson resigned as President of the Fund, and effective March 4, 2008, Mr. Walstad succeeded Mr. Anderson as Interim President of the Fund. Mr. Walstad is also a Trustee and Chairman of the Fund.

Trustees and Officers of the Fund serve until their resignation, removal, or retirement.

The SAI contains more information about the Fund's Trustees and is available without charge upon request, by calling Integrity Funds Distributor at 800-276-1262.

Schedule of Investments July 31, 2008

Name of Issuer
Percentages represent the market value of each investment category to total net assets	Rating (Unaudited) Moody's S&P	Coupon Rate	Maturity		Principal Amount		Market Value
MAINE MUNICIPAL BONDS (76.7%)
Bar Harbor, ME	A-1/NR	6.450%	06/01/2009	$	75,000	$	77,780
Bath, ME	A-3/NR	7.500	12/01/2008		20,000		20,364
Brewer, ME	A/A	4.600	11/01/2017		210,000		220,090
Freeport, ME	Aa-3/AA	7.250	09/01/2010		20,000		21,989
Gorham, ME Unlimited Tax G.O. MBIA	A-1/NR	4.300	02/01/2023		155,000		157,063
Gorham, ME Unlimited Tax G.O. MBIA	A-1/NR	4.350	02/01/2024		155,000		157,210
Houlton, ME Water District MBIA	A/NR	4.600	05/01/2014		100,000		101,970
Kennebec, ME Regl. Dev.	Baa-1/NR	5.500	08/01/2014		75,000		78,989
#Kennebec, ME Water District FSA	Aaa/NR	5.125	12/01/2021		500,000		506,040
Kittery, ME	A-1/AA	5.200	01/01/2009		25,000		25,278
Lewiston, ME G.O. FSA	Aaa/NR	5.000	04/01/2022		500,000		524,320
Lewiston, ME G.O. FSA	Aaa/NR	5.000	04/01/2024		250,000		261,645
Lewiston, ME G.O. FSA	Aaa/NR	4.500	01/15/2025		200,000		200,358
Maine Governmental Facs. Auth Lease MBIA	A-1/AA	5.375	10/01/2016		250,000		266,445
Maine Governmental Facs. Auth Lease Rent Rev.	Aaa/AAA	5.000	10/01/2023		125,000		129,417
Maine Health & Higher Educ. Facs. Auth. (Bates College) FSA	Aaa/AAA	5.250	07/01/2011		25,000		25,173
*Maine Health & Higher Educ. Facs. Auth. (Blue Hill Mem. Hosp) FSA	Aaa/AAA	5.250	07/01/2010		410,000		415,117
Maine Health & Higher Educ. Facs. Auth.	Aaa/NR	6.000	10/01/2013		195,000		217,550
Maine Health & Higher Educ. (University Systems) MBIA	Aa-3/NR	5.000	07/01/2023		200,000		207,872
Maine Health & Higher Educ. Facs. Auth. Rev. AMBAC	Aa-3/AA	7.300	05/01/2014		5,000		5,000
Maine Health & Higher Educ. Facs. Rev. AMBAC	Aa-3/NR	5.000	07/01/2022		250,000		255,308
Maine Health & Higher Educ. Auth. (Maine Maritime Academy) MBIA	Aa-3/NR	5.000	07/01/2025		340,000		351,852
*Maine Municipal Bond Bank MBIA	Aa-1/AAA	5.625	11/01/2016		1,000,000		1,076,710
Maine Municipal Bond Bank (Sewer & Water) Rev.	Aaa/AAA	4.900	11/01/2024		100,000		103,905
Maine State (Highway)	Aa-3/AA	5.000	06/15/2011		200,000		212,446
*Maine State Turnpike Auth. Rev. FGIC	Aa-3/A+	5.750	07/01/2028		750,000		807,383
Maine State Turnpike Auth.	Aa-3/AA	5.000	07/01/2033		450,000		452,138
Portland, ME	Aa/AA	5.000	09/01/2013		60,000		63,512
#Portland, ME Airport Rev. FSA	Aaa/AAA	5.000	07/01/2032		500,000		498,650
Scarborough, ME G.O. MBIA	Aa-3/AA	4.400	11/01/2031		250,000		231,360
Scarborough, ME G.O. MBIA	Aa-3/AA	4.400	11/01/2032		480,000		442,766
#Skowhegan, ME Pollution Ctl. Rev. (Scott Paper Co. Prj.)	A/A+	5.900	11/01/2013		1,465,000		1,465,000
South Portland, ME	Aa-1/NR	5.800	09/01/2008		150,000		150,532
South Portland, ME	Aa-1/NR	5.800	09/01/2011		40,000		43,695
University of Maine System Rev. AMBAC	Aa-3/AA	5.000	03/01/2024		100,000		101,277
#University of Maine System Rev. MBIA	A/AA	4.750	03/01/2037		550,000		531,954
Westbrook, ME G.O. MBIA	A/AA	3.250	10/15/2009		195,000		197,980
Westbrook, ME G.O. FGIC	NR/A+	4.250	10/15/2020		180,000		181,748
Windham, ME G.O. AMBAC	Aa-3/AA	3.125	11/01/2010		100,000		101,250
Windham, ME G.O. AMBAC	Aa-3/AA	4.000	11/01/2014		415,000		427,952
Yarmouth, ME AMBAC	Aa-3/NR	5.250	11/15/2009		250,000		260,653
#Yarmouth, ME	Aa-3/AA-	5.000	11/15/2019		500,000		532,040
York, ME G.O.	NR/AA	4.000	09/01/2010		75,000		77,810
TOTAL MAINE MUNICIPAL BONDS						$	12,187,591
GUAM MUNICIPAL BONDS (0.1%)
Guam Hsg. Corp. Single Family Mtg.	NR/AAA	5.750	09/01/2031		10,000	$	9,793
PUERTO RICO MUNICIPAL BONDS (13.3%)
*Puerto Rico Commonwealth Highway and Trans. Rev. MBIA	A/AA	5.500	07/01/2036		250,000	$	284,158
*Puerto Rico Public Finance Corp. Commonwealth Appropriations AMBAC	Aaa/AAA	5.375	06/01/2018		1,710,000		1,826,280
TOTAL PUERTO RICO MUNICIPAL BONDS						$	2,110,438
VIRGIN ISLANDS MUNICIPAL BONDS (3.2%)
Virgin Islands Water & Power Auth. Elec. Syst. Rev. ACA/MBIA	Aaa/AA	5.300	07/01/2021		500,000	$	505,195
TOTAL MUNICIPAL BONDS (COST: $14,520,093)						$	14,813,017
SHORT-TERM SECURITIES (6.2%)					Shares
Wells Fargo Advantage National Tax-Free Money Market (COST: $980,415)					980,415	$	980,415
TOTAL INVESTMENTS IN SECURITIES (COST: $15,500,508)						$	15,793,432
OTHER ASSETS LESS LIABILITIES							86,333
NET ASSETS						$	15,879,765

*Indicates bonds are segregated by the custodian to cover when-issued or delayed delivery purchases.

#Indicates bonds are segregated by the custodian to cover initial margin requirements.

Footnote: Non-rated (NR) securities have been determined to be of investment grade quality by the Fund's Manager.

Various inputs are used in determining the value of the Fund's investments. These inputs are summarized in three broad levels:

Level 1–	quoted prices in active markets for identical securities
Level 2–	other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risks, etc.)
Level 3–	significant unobservable inputs (including the Fund's own assumptions in determining the fair value of investments)

The following is a summary of the inputs used to value the Fund's investments as of July 31, 2008:

Valuation Inputs	Investments in Securities
Level 1–Quoted Prices	$	980,415
Level 2–Other Significant Observable Inputs		14,813,017
Level 3–Significant Unobservable Inputs		0
Total	$	15,793,432

The accompanying notes are an integral part of these financial statements.

Financial Statements July 31, 2008

Statement of Assets and Liabilities

July 31, 2008

ASSETS
	Investments in securities, at value (cost: $15,500,508)		$	15,793,432
	Accrued interest receivable			156,847
	Accrued dividends receivable			1,232
	Receivable from manager			4,006
	Prepaid expenses			2,217
		Total Assets	$	15,957,734
LIABILITIES
	Disbursements in excess of demand deposit cash		$	4,721
	Dividends payable			44,880
	Accrued expenses			17,561
	Payable to affiliates			10,807
		Total Liabilities	$	77,969
NET ASSETS			$	15,879,765
Net assets are represented by:
	Paid-in capital		$	16,225,635
	Accumulated undistributed net realized gain (loss) on investments and futures			(664,401)
	Accumulated undistributed net investment income (loss)			25,607
	Unrealized appreciation (depreciation) on investments			292,924
		Total amount representing net assets applicable to 1,521,598 outstanding shares of no par common stock (unlimited shares authorized)	$	15,879,765
Net asset value per share			$	10.44
Public offering price (based on sales charge of 4.25%)			$	10.90

The accompanying notes are an integral part of these financial statements.

Financial Statements July 31, 2008

Statement of Operations

For the year ended July 31, 2008

INVESTMENT INCOME
	Interest		$	725,347
	Dividends			17,020
		Total Investment Income	$	742,367
EXPENSES
	Investment advisory fees		$	81,327
	Distribution (12b-1) fees			40,663
	Administrative service fees			24,001
	Transfer agent fees			32,531
	Accounting service fees			32,133
	Custodian fees			3,142
	Professional fees			10,728
	Trustees fees			2,705
	Insurance expense			427
	Reports to shareholders			2,141
	Audit fees			6,576
	Legal fees			12,373
	Transfer agent out-of-pockets			1,207
	License, fees, and registrations			3,535
		Total Expenses	$	253,489
	Less expenses waived or absorbed by the Fund's manager			(79,450)
		Total Net Expenses	$	174,039
NET INVESTMENT INCOME (LOSS)			$	568,328
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
	Net realized gain (loss) from investment transactions		$	31,683
	Net change in unrealized appreciation (depreciation) of investments			(50,559)
		Net Realized and Unrealized Gain (Loss) on Investments	$	(18,876)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS			$	549,452

The accompanying notes are an integral part of these financial statements.

Financial Statements July 31, 2008

Statement of Changes in Net Assets

For the year ended July 31, 2008 and the year ended July 31, 2007

			For The Year Ended July 31, 2008		For The Year Ended July 31, 2007
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
	Net investment income (loss)		$	568,328	$	630,621
	Net realized gain (loss) on investment transactions			31,683		33,318
	Net change in unrealized appreciation (depreciation) on investments			(50,559)		(131,902)
		Net Increase (Decrease) in Net Assets Resulting From Operations	$	549,452	$	532,037
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
	Dividends from net investment income ($.36 and $.37 per share, respectively)		$	(562,812)	$	(624,718)
	Distributions from net realized gain on investment transactions ($.00 and $.00 per share, respectively)			0		0
		Total Dividends and Distributions	$	(562,812)	$	(624,718)
CAPITAL SHARE TRANSACTIONS
	Proceeds from sale of shares		$	366,136	$	611,753
	Proceeds from reinvested dividends			321,799		360,742
	Cost of shares redeemed			(1,501,361)		(2,901,433)
		Net Increase (Decrease) in Net Assets Resulting from Capital Share Transactions	$	(813,426)	$	(1,928,938)
TOTAL INCREASE (DECREASE) IN NET ASSETS			$	(826,786)	$	(2,021,619)
NET ASSETS, BEGINNING OF PERIOD				16,706,551		18,728,170
NET ASSETS, END OF PERIOD			$	15,879,765	$	16,706,551
Undistributed Net Investment Income			$	25,607	$	20,090

The accompanying notes are an integral part of these financial statements.

Notes to Financial Statements July 31, 2008

Note 1. ORGANIZATION

The Fund is an investment portfolio of Integrity Managed Portfolios (the "Trust") and is registered under the Investment Company Act of 1940, as amended (the "1940 Act") as a non-diversified, open-end management investment company. The Trust may offer multiple portfolios; currently six portfolios are offered. The Trust is an unincorporated business trust organized under Massachusetts law on August 10, 1990.

The investment objective of the Fund is to provide its shareholders with as high a level of current income exempt from both federal and Maine state income tax as is consistent with preservation of capital. The Fund will seek to achieve this objective by investing primarily in a portfolio of Maine municipal securities.

On December 19, 2003, the Fund became a series of the Trust. Prior to this date, the Fund was part of the Forum Funds and was named the Maine TaxSaver Bond Fund. The Maine TaxSaver Bond Fund commenced operations on December 5, 1991. The Forum Funds is a Delaware business trust that is registered as an open-end management investment company under the 1940 Act.

Shares of the Fund are offered at net asset value plus a maximum sales charge of 4.25% of the offering price.

Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Investment security valuation—Securities for which quotations are not readily available (which will constitute a majority of the securities held by the Fund) are valued using a matrix system at fair value as determined by Integrity Money Management. The matrix system has been developed based on procedures approved by the Board of Trustees and includes consideration of the following:

• yields or prices of municipal bonds of comparable quality;

• type of issue, coupon, maturity, and rating;

• indications as to value from dealers; and

• general market conditions.

Because the market value of securities can only be established by agreement between parties in a sales transaction, and because of the uncertainty inherent in the valuation process, the fair values as determined may differ from the values that would have been used had a ready market for the securities existed. The Fund follows industry practice and records security transactions on the trade date.

The Fund concentrates its investments in a single state. This concentration may result in the Fund investing a relatively high percentage of its assets in a limited number of issuers.

When-issued securities—The Fund may purchase securities on a when-issued basis. Payment and delivery may take place after the customary settlement period for that security. The price of the underlying securities and the date when the securities will be delivered and paid for are fixed at the time the transaction is negotiated. The value of the securities purchased on a when-issued basis are identified as such in the Fund's Schedule of Investments. With respect to purchase commitments, the Fund identifies securities as segregated in its records with a value at least equal to the amount of the commitment. Losses may arise due to changes in the value of the underlying securities or if the counterparty does not perform under the contract's terms, or if the issuer does not issue the securities due to political, economic, or other factors.

Contingent Deferred Sales Charge—In the case of investments of $1 million or more, a 1.00% CDSC may be assessed on shares redeemed within 24 months of purchase (excluding shares purchased with reinvested dividends and/or distributions).

Federal and state income taxes—The Fund's policy is to comply with the requirements of the Internal Revenue Code that are applicable to regulated investment companies and to distribute all of its net investment income and any net realized gain on investments to its shareholders. Therefore, no provision for income taxes is required.

In June 2006, the Financial Accounting Standards Board ("FASB") issued Interpretation No. 48, "Accounting for Uncertainty in Income Taxes" ("FIN 48"). FIN 48 establishes the minimum threshold for recognizing, and a system for measuring, the benefits of tax-return positions taken on federal income tax returns for all open tax years (tax years ended July 31, 2004 through July 31, 2008) for purposes of implementing FIN 48, and has concluded that no provision for income tax is required in the Fund's financial statements. Interest and penalties related to uncertain tax positions, if any, are classified in the Fund's financial statements as other expense.

The tax character of distributions paid was as follows:

		July 31, 2008		July 31, 2007
Tax-exempt income		$	562,812	$	624,718
Ordinary income			0		0
Long-term capital gains			0		0
	Total	$	562,812	$	624,718

As of July 31, 2008, the components of accumulated earnings/(deficit) on a tax basis were as follows:

Undistributed Ordinary Income	Undistributed Long-Term Capital Gains	Undistributed Accumulated Earnings	Accumulated Capital and Other Losses	Unrealized Appreciation/ (Depreciation)	Total Accumulated Earnings/(Deficit)
$0	$0	$0	($664,401)	$318,531	($345,870)

The Fund has unexpired capital loss carryforwards for tax purposes as of July 31, 2008 totaling $664,401, which may be used to offset capital gains. Any difference between book-basis and tax-basis unrealized appreciation/(depreciation) is attributable to timing differences associated with market discount. The capital loss carryforward amounts will expire in each of the years ended July 31 as shown in the table below.

Year	Unexpired Capital Losses
2013	$664,401

For the year ended July 31, 2008, the Fund did not make any permanent reclassifications to reflect tax character.

Net capital losses incurred after October 31 and within the tax year are deemed to arise on the first business day of the Fund's next taxable year. For the year ended July 31, 2008, the Fund did not defer to August 1, 2008, any post-October capital losses, post-October currency losses, or post-October passive foreign investment company losses.

Distributions to shareholders—Dividends from net investment income, declared daily and paid monthly, are reinvested in additional shares of the Fund at net asset value or paid in cash. Capital gains, when available, are distributed at least annually.

Premiums and discounts—Premiums and discounts on municipal securities are amortized for financial reporting purposes.

Other—Income and expenses are recorded on the accrual basis. Investment transactions are accounted for on the trade date. Realized gains and losses are reported on the identified cost basis. Distributions to shareholders are recorded by the Fund on the ex-dividend date. Income and capital gain distributions are determined in accordance with federal income tax regulations and may differ from net investment income and realized gains determined in accordance with accounting principles generally accepted in the United States of America. These differences are primarily due to differing treatments for market discount, capital loss carryforwards, and losses due to wash sales and futures transactions.

Permanent book and tax basis differences relating to shareholder distributions will result in reclassifications to paid-in capital. Temporary book and tax basis differences will reverse in a subsequent period.

Futures contracts—The Fund may purchase and sell financial futures contracts to hedge against changes in the values of tax-exempt municipal securities the Fund owns or expects to purchase.

A futures contract is an agreement between two parties to buy or sell units of a particular index or a certain amount of U.S. government or municipal securities at a set price on a future date. Upon entering into a futures contract, the Fund is required to deposit with a broker an amount of cash or securities equal to the minimum "initial margin" requirement of the futures exchange on which the contract is traded. Subsequent payments ("variation margin") are made or received by the Fund, dependent on the fluctuations in the value of the underlying index. Daily fluctuations in value are recorded for financial reporting purposes as unrealized gains or losses by the Fund. When entering into a closing transaction, the Fund will realize, for book purposes, a gain or loss equal to the difference between the value of the futures contracts sold and the futures contracts to buy. Unrealized appreciation (depreciation) related to open futures contracts is required to be treated as realized gain (loss) for federal income tax purposes.

Securities held in collateralized accounts to cover initial margin requirements on open futures contracts are noted in the Schedule of Investments. The Statement of Assets and Liabilities reflects a receivable or payable for the daily mark to market for variation margin.

Certain risks may arise upon entering into futures contracts. These risks may include changes in the value of the futures contracts that may not directly correlate with changes in the value of the underlying securities.

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

Note 3. CAPITAL SHARE TRANSACTIONS

As of July 31, 2008, there were unlimited shares of no par authorized; 1,521,598 and 1,598,291 shares were outstanding at July 31, 2008 and July 31, 2007, respectively.

Transactions in capital shares were as follows:

	Shares
	For The Year Ended July 31, 2008	For The Year Ended July 31, 2007
Shares sold	34,727	58,003
Shares issued on reinvestment of dividends	30,645	34,165
Shares redeemed	(142,065)	(274,649)
Net increase (decrease)	(76,693)	(182,481)

Note 4. INVESTMENT ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES

Integrity Money Management, the Fund's investment adviser; Integrity Funds Distributor, the Fund's underwriter; and Integrity Fund Services, Inc. ("Integrity Fund Services"), the Fund's transfer, accounting, and administrative services agent; are subsidiaries of Integrity Mutual Funds, the Fund's sponsor.

The Fund has engaged Integrity Money Management to provide investment advisory and management services to the Fund. The Investment Advisory Agreement provides for fees to be computed at an annual rate of 0.50% of the Fund's average daily net assets. The Fund has recognized $9,770 of investment advisory fees after partial waiver for the year ended July 31, 2008. The Fund does not have a payable to Integrity Money Management at July 31, 2008 for investment advisory fees. Certain Officers and Trustees of the Fund are also Officers and Directors of Integrity Money Management.

Under the terms of the advisory agreement, Integrity Money Management has agreed to pay all the expenses of the Fund (excluding taxes and brokerage fees and commissions, if any) that exceed 1.07% of the Fund's average daily net assets on an annual basis up to the amount of the investment advisory and management fee. Accordingly, after fee waivers and expense reimbursements, the Fund's actual total annual operating expenses were 1.07% for the year ended July 31, 2008.

Principal underwriter and shareholder services

Integrity Funds Distributor serves as the principal underwriter for the Fund. The Fund has adopted a distribution plan as allowed by Rule 12b-1 of the 1940 Act. Distribution plans permit the Fund to reimburse its principal underwriter for costs related to selling shares of the Fund and for various other services. These costs, which consist primarily of commissions and service fees to broker-dealers who sell shares of the Fund, are paid by shareholders through expenses called "Distribution Plan expenses". The Fund currently pays an annual distribution fee of up to 0.25% of the average daily net assets of the Fund. Distribution Plan expenses are calculated daily and paid monthly. The Fund has recognized $40,663 of distribution fees for the year ended July 31, 2008. The Fund has a payable to Integrity Funds Distributor of $3,324 at July 31, 2008 for distribution fees.

Integrity Fund Services, the transfer agent, provides shareholder services for a variable fee equal to 0.20% of the Fund's average daily net assets on an annual basis for the Fund's first $50 million and at a lower rate on the average daily net assets in excess of $50 million, with a minimum of $2,000 per month plus reimbursement of out-of-pocket expenses. An additional fee with a minimum of $500 per month is charged for each additional share class. The Fund has recognized $32,531 of transfer agency fees and expenses for the year ended July 31, 2008. The Fund has a payable to Integrity Fund Services of $2,659 at July 31, 2008 for transfer agency fees. Integrity Fund Services also acts as the Fund's accounting services agent for a monthly fee equal to the sum of a fixed fee of $2,000, and a variable fee equal to 0.05% of the Fund's average daily net assets on an annual basis for the Fund's first $50 million and at a lower rate on the average daily net assets in excess of $50 million. An additional fee with a minimum of $500 per month is charged for each additional share class. The Fund has recognized $32,133 of accounting service fees for the year ended July 31, 2008. The Fund has a payable to Integrity Fund Services of $2,665 at July 31, 2008 for accounting service fees. Integrity Fund Services also acts as the Fund's administrative services agent for a variable fee equal to 0.125% of the Fund's average daily net assets on an annual basis for the Fund's first $50 million and at a lower rate on the average daily net assets in excess of $50 million, with a minimum of $2,000 per month plus out-of-pocket expenses. An additional fee with a minimum of $500 per month will be charged for each additional share class. The Fund has recognized $24,001 of administrative service fees for the year ended July 31, 2008. The Fund has a payable to Integrity Fund Services of $2,000 at July 31, 2008 for administrative service fees.

Note 5. INVESTMENT SECURITY TRANSACTIONS

The cost of purchases and proceeds from the sales of investment securities (excluding short-term securities) aggregated $686,429 and $1,263,765, respectively, for the year ended July 31, 2008.

Note 6. INVESTMENT IN SECURITIES

At July 31, 2008, the aggregate cost of securities for federal income tax purposes was substantially the same for financial reporting purposes at $15,500,508. The net unrealized appreciation of investments based on the cost was $292,924, which is comprised of $414,400 aggregate gross unrealized appreciation and $121,476 aggregate gross unrealized depreciation. Differences between financial reporting-basis and tax-basis unrealized appreciation/(depreciation) are due to differing treatment of market discount.

Note 7. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In September 2006, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards (SFAS) No. 157 Fair Value Measurements. This standard defines fair value, and establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands disclosures about fair value measurements. The standard is effective for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years.

In accordance with the provisions of SFAS No. 157, the Fund adopted this standard during the current fiscal year. The implementation of the standard did not impact the amounts reported in the financial statements.

In March 2008, FASB issued SFAS No. 161 Disclosures about Derivative Instruments and Hedging Activities. This standard requires enhanced disclosures to provide information about the reasons the Fund invests in derivative instruments, the accounting treatment and the effect derivatives have on financial performance. The standard is effective for fiscal years beginning after November 15, 2008, and interim periods within those fiscal years. Management is currently evaluating the impact the adoption of SFAS No. 161 will have on the Fund's financial statement disclosures.

Financial Highlights July 31, 2008

Selected per share data and ratios for the periods indicated

				For The Year Ended July 31, 2008		For The Year Ended July 31, 2007		For The Year Ended July 31, 2006		For The Year Ended July 29, 2005		For The Four Month Period Ended July 30, 2004		For The Year Ended March 31, 2004
NET ASSET VALUE, BEGINNING OF PERIOD			$	10.45	$	10.52	$	10.45	$	11.10	$	11.19	$	11.35
Income from Investment Operations:
	Net investment income (loss)		$	.36	$	.37	$	.35	$	.35	$	.13	$	.39
	Net realized and unrealized gain (loss) on investment and futures transactions			(.01)		(.07)		.07		(.43)		(.09)		(.10)
		Total Income (Loss) From Investment Operations	$	.35	$	.30	$	.42	$	(.08)	$	.04	$	.29
Less Distributions:
	Dividends from net investment income		$	(.36)	$	(.37)	$	(.35)	$	(.35)	$	(.13)	$	(.39)
	Distributions from net realized gains			.00		.00		.00		(.22)		.00		(.06)
		Total Distributions	$	(.36)	$	(.37)	$	(.35)	$	(.57)	$	(.13)	$	(.45)
NET ASSET VALUE, END OF PERIOD			$	10.44	$	10.45	$	10.52	$	10.45	$	11.10	$	11.19
Total Return				3.43%(A)		2.89%(A)		4.12%(A)		(0.74%)(A)		1.23%(A)(C)		2.56%(A)
RATIOS/SUPPLEMENTAL DATA:
	Net assets, end of period (in thousands)		$	15,880	$	16,707	$	18,728	$	24,975	$	31,683	$	33,270
	Ratio of net expenses (after expense assumption) to average net assets			1.07%(B)		1.07%(B)		1.02%(B)		0.97%(B)		0.95%(B)(C)		0.95%(B)
	Ratio of net investment income to average net assets			3.46%		3.52%		3.35%		3.24%		3.49%(C)		3.44%
	Portfolio turnover rate			4.44%		8.50%		1.60%		4.87%		1.92%		34.40%

^(A) Excludes maximum sales charge of 4.25%.

^(B) During the periods since March 31, 2004, Integrity Money Management assumed and/or waived expenses of $79,450, $64,859, $58,447, $86,089, and $29,051, respectively. If the expenses had not been assumed and/or waived, the annualized ratio of total expenses to average net assets would have been 1.56%, 1.44%, 1.30%, 1.27%, and 1.22%, respectively. For the period 4/1/2003 through 12/19/2003, Forum Administrative Services assumed/waived expenses of $64,658. For the period from 12/20/2003 through 3/31/2004, Integrity Money Management assumed/waived expenses of $22,736. If the expenses had not been assumed and/or waived, the annualized ratio of total expenses to average net assets for the year would have been 1.20%.

^(C) Ratio is annualized.

Total return represents the rate that an investor would have earned or lost on an investment in the Fund assuming reinvestment of all dividends and distributions.

The accompanying notes are an integral part of these financial statements.

Tax Information for the Year Ended July 31, 2008 (Unaudited)

We are required to advise you within 60 days of the Fund's fiscal year regarding the federal tax status of distributions received by shareholders during such fiscal year. The distributions made during the fiscal year by the Fund were earned from the following sources:

		Dividends and Distributions Per Share
To Shareholders of Record	Payment Date		From Net Investment Income	From Net Realized Short-Term Gains	From Net Realized Long-Term Gains
August 31, 2007	August 31, 2007	$	.030599	.0	.0
September 28, 2007	September 28, 2007	$	.028694	.0	.0
October 31, 2007	October 31, 2007	$	.032513	.0	.0
November 30, 2007	November 30, 2007	$	.030580	.0	.0
December 31, 2007	December 31, 2007	$	.030519	.0	.0
January 31, 2008	January 31, 2008	$	.030427	.0	.0
February 29, 2008	February 29, 2008	$	.030083	.0	.0
March 31, 2008	March 31, 2008	$	.030465	.0	.0
April 30, 2008	April 30, 2008	$	.030425	.0	.0
May 30, 2008	May 30, 2008	$	.030299	.0	.0
June 30, 2008	June 30, 2008	$	.030184	.0	.0
July 31, 2008	July 31, 2008	$	.029447	.0	.0

Shareholders should consult their tax advisors.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Trustees of the Maine Municipal Fund

We have audited the accompanying statement of assets and liabilities of the Maine Municipal Fund (one of the portfolios constituting the Integrity Managed Portfolios), including the schedule of investments as of July 31, 2008, the related statement of operations for the year then ended, the statement of changes in net assets for each of the two years in the period then ended, and the financial highlights for the years ended July 31, 2008, July 31, 2007, July 31, 2006, and July 29, 2005, the four month period ended July 30, 2004, and the year ended March 31, 2004. These financial statements and financial highlights are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of July 31, 2008 by correspondence with the custodian and brokers. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Maine Municipal Fund of the Integrity Managed Portfolios as of July 31, 2008, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for the years ended July 31, 2008, July 31, 2007, July 31, 2006, and July 29, 2005, the four month period ended July 30, 2004, and the year ended March 31, 2004, in conformity with accounting principles generally accepted in the United States of America.

BRADY, MARTZ & ASSOCIATES, P.C.

Minot, North Dakota USA

September 12, 2008

Dear Shareholder:

Enclosed is the annual report of the Nebraska Municipal Fund (the "Fund") for the year ended July 31, 2008. The Fund's portfolio and related financial statements are presented within for your review.

As we end the year, what one might have thought was an uneventful year was much the opposite.

First, interest rates spiked higher early in June as Federal Reserve Chairman Ben Bernanke voiced concern about inflation and the slumping dollar. However, a string of weak economic reports in the last part of June (consumer confidence plunged to its lowest level since 1992) along with more losses and downgrades in the banking sector, reduced corporate earnings expectations as well as higher energy prices have encouraged market participants to dump stocks in favor of low-risk government bonds, sending the 10-year treasury to 3.95%.

Second, while the market likes to talk about light at the end of the tunnel, unfortunately in these days of financial turmoil we can never be sure whether it is light from the other side or another freight train coming. Most recently, Fannie Mae and Freddie Mac who own or guarantee nearly half of the $12 trillion mortgage market have seen their company stocks fall 75-80% year-to-date, as the worst housing downturn since the Great Depression impacted expected solvency levels.

Municipals on the other hand didn't fare any better as a number of the secondary insurers saw significant downgrades of their ratings, the collapse of major financial institution Bear Stearns and the exit of UBS from the municipal bond market.

The secondary insurers of municipal debt are in turmoil as a number of the insurance companies are in dire straits. Many bond professionals and investors, who in the past treated all insured bonds equal from a credit perspective, now understand the importance of the underlying credit, the purpose of the debt issued, and its commitment to pay. Currently there are three insurers of municipal debt that have AAA ratings from all three rating agencies and two of those three insurers are on Credit Watch for possible downgrade.

These events have created great uncertainty and with that, opportunity. It is now a buyers market as high quality municipals are yielding in many instances, yields higher than taxable treasuries of similar maturities. Clearly there will be price rallies and price sell offs in the months ahead, but the underlying tone for tax-free municipals is bullish.

The Nebraska Municipal Fund began the period at $10.13 and ended the period at $10.03 for a total return of 2.79%*. This compares to the Lehman Brothers Municipal Bond Index return of 2.84%.

The Fund's yearly overall performance can be attributed to its defensive portfolio, with an average maturity of 15.2 years and an average maturity to the first call date of 4.4 years. That, along with an average portfolio coupon of 5.21% helps relative performance in volatile environments.

An important part of the Fund's strategy includes searching the primary and secondary markets for high quality, double tax-exempt issues. Some purchases made throughout the year include: Public Power Generation (Whelan Energy), 5.00% coupon, due 2032; University of Nebraska Health & Rec. Projects, 5.00% coupon, due 2033; Douglas County (Methodist Health), 5.50% coupon, due 2038; and Adams County Hospital (Mary Lanning Memorial), 5.25% coupon, due 2033.

Portfolio quality at year-end was as follows: AAA 18.4%, AA 54.5%, A 19.7%, BBB 2.6% and NR 4.8%. 

Income exempt from federal and Nebraska state income taxes with preservation of capital remain the primary objectives of the Fund.

If you would like more frequent updates, visit the Fund's website at www.integrityfunds.com for daily prices along with pertinent Fund information.

Sincerely,

Monte Avery
Senior Portfolio Manager  

The views expressed are those of Monte Avery, Senior Portfolio Manager with Integrity Mutual Funds, Inc. ("Integrity Mutual Funds"). The views are subject to change at any time in response to changing circumstances in the market and are not intended to predict or guarantee the future performance of any individual security, market sector, the markets generally, or any Integrity Mutual Fund.

*Performance does not include applicable front-end or contingent deferred sales charges ("CDSCs"), which would have reduced the performance.

Performance data quoted above is historical. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. The principal value and investment return of an investment will fluctuate so that your shares, when redeemed, may be worth more or less than the original cost. You can obtain performance data current to the most recent month end (available within seven business days of the most recent month end) by calling 800-276-1262.

You should consider the Fund's investment objectives, risks, charges, and expenses carefully before investing. For this and other important information, please obtain a Fund prospectus at no cost from your financial adviser and read it carefully before investing.

Bond prices and, therefore, the value of bond funds decline as interest rates rise. Because the Fund invests in securities of a single state, the Fund is more susceptible to factors adversely impacting the respective state securities more so than a municipal bond fund that does not concentrate its securities in a single state.

July 31, 2008 (Unaudited)

PROXY VOTING OF FUND PORTFOLIO SECURITIES

A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to securities held in the Fund's portfolio is available, without charge and upon request, by calling 800-276-1262. A report on Form N-PX of how the Fund voted any such proxies during the most recent twelve-month period ended June 30 is available through the Fund's website at www.integrityfunds.com. The information is also available from the Electronic Data Gathering, Analysis, and Retrieval ("EDGAR") database on the website of the Securities and Exchange Commission ("SEC") at www.sec.gov.

QUARTERLY PORTFOLIO SCHEDULE

Within 60 days of the end of its second and fourth fiscal quarters, the Fund provides a complete schedule of portfolio holdings in its semi-annual and annual reports on the Form N-CSR(S). These reports are filed electronically with the SEC and are delivered to the shareholders of the Fund. The Fund also files its 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 Forms N-Q and N-CSR(S) are available on the SEC's website at www.sec.gov. The Fund's Forms N-Q and N-CSR(S) 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 202-942-8090. You may also access this information from the Fund's website at www.integrityfunds.com.

SHAREHOLDER INQUIRIES AND MAILINGS

All inquiries regarding the Fund should be directed to:

Integrity Funds Distributor, Inc.
1 Main Street North
Minot, ND 58703
Phone: 800-276-1262

All inquiries regarding account information should be directed to:

Integrity Fund Services, Inc.
P.O. Box 759
Minot, ND 58702
Phone: 800-601-5593

To reduce expenses, the Fund may only mail one copy of its prospectus and each annual and semi-annual report to those addresses shared by two or more accounts. If you wish to receive individual copies of these documents, please call Integrity Funds Distributor, Inc. ("Integrity Funds Distributor") at 800-276-1262 (or contact your financial institution). Individual copies will be sent thirty days after receiving your request.

Terms & Definitions July 31, 2008 (Unaudited)

Appreciation

Increase in the value of an asset

Average Annual Total Return

A standardized measurement of the return (yield and appreciation) earned by a fund on an annual basis assuming all distributions are reinvested

Coupon Rate or Face Rate

Rate of interest payable annually based on the face amount of the bond; expressed as a percentage

Depreciation

Decrease in the value of an asset

Lehman Brothers Municipal Bond Index

An unmanaged list of long-term, fixed-rate, investment-grade, tax-exempt bonds representative of the municipal bond market; the index does not take into account brokerage commissions or other costs, may include bonds different from those in the Fund, and may pose different risks than the Fund

Market Value

Actual (or estimated) price at which a bond trades in the marketplace

Maturity

A measure of the term or life of a bond in years; when a bond "matures", the issuer repays the principal

Net Asset Value

The value of all of a fund's assets, minus any liabilities, divided by the number of outstanding shares, not including any initial sales charge

Quality Ratings

A designation assigned by independent rating companies to give a relative indication of a bond's creditworthiness; "AAA," "AA," "A," and "BBB" indicate investment grade securities. Ratings can range from a high of "AAA" to a low of "D".

Total Return

Measures both the net investment income and any realized and unrealized appreciation or depreciation of the underlying investments in a fund's portfolio for the period, assuming the reinvestment of all dividends; represents the aggregate percentage or dollar value change over the period

July 31, 2008 (Unaudited)

COMPOSITION

Portfolio Quality Ratings
(Based on total long-term investments)

AAA	18.4%
AA	54.5%
A	19.7%
BBB	2.6%
NR	4.8%

Quality ratings reflect the financial strength of the issuer. They are assigned by independent ratings services such as Moody's Investors Services ("Moody's") and Standard & Poor's Ratings Group ("S&P"). Non-rated bonds have been determined to be of appropriate quality for the portfolio by Integrity Money Management, Inc. ("Integrity Money Management"), the Fund's investment adviser.

These percentages are subject to change.

Portfolio Market Sectors
(As a percentage of Net Assets)

S—School	35.8%
U—General Utilities	19.1%
H—Health	18.8%
I—Industrial	8.4%
O—Other	6.6%
T—Transportation	5.7%
WS—Water/Sewer	5.6%

Market sectors are breakdowns of the Fund's portfolio holdings into specific investment classes.

These percentages are subject to change.

July 31, 2008 (Unaudited)

DISCLOSURE OF FUND EXPENSES

The example below is intended to describe the fees and expenses borne by shareholders and the impact of those costs on your investment.

EXAMPLE

As a shareholder of the Fund, you incur two types of costs:

•	transaction costs:	sales charges (loads), redemption fees, and exchange fees
•	ongoing costs:	management fees, distribution (12b-1) fees, and other Fund expenses

This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period from January 31, 2008 to July 31, 2008.

The example illustrates the Fund's costs in two ways:

Actual expenses

The section in the table under the heading "Actual" provides information about actual account values and actual expenses. You may use the information in these columns together with the amount you invested to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an account value of $8,600 divided by $1,000 equals 8.6), then multiply the result by the number in the column entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period.

Hypothetical example for comparison purposes

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

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees, or exchange fees. Therefore, the section in the table under the heading "Hypothetical (5% return before expenses)" is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

	Beginning Account Value 01/31/08	Ending Account Value 07/31/08		Expenses Paid During Period*
Actual	$1,000.00	$	989.20	$5.32
Hypothetical (5% return before expenses)	$1,000.00	$	1,019.51	$5.40

*Expenses are equal to the annualized expense ratio of 1.07%, multiplied by the average account value over the period, multiplied by 180/360 days. The Fund's ending account value on the first line in the table is based on its actual total return of (1.08%) for the six-month period of January 31, 2008 to July 31, 2008.

July 31, 2008 (Unaudited)

AVERAGE ANNUAL TOTAL RETURNS

		For periods ending July 31, 2008
Nebraska Municipal Fund		1 year	3 year	5 year	10 year	Since Inception (November 17, 1993)
	Without Sales Charge	2.79%	3.61%	2.84%	3.33%	3.74%
	With Sales Charge (4.25%)	(1.59%)	2.12%	1.95%	2.88%	3.44%
Lehman Brothers Municipal Bond Index		1 year	3 year	5 year	10 year	Since Inception (November 17, 1993)
		2.84%	3.22%	4.35%	4.92%	5.34%

Putting Performance into Perspective

Performance data quoted above is historical. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. The principal value and investment return of an investment will fluctuate so that your shares, when redeemed, may be worth more or less than the original cost. You can obtain performance data current to the most recent month end (available within seven business days of the most recent month end) by calling 800-276-1262.

You should consider the Fund's investment objectives, risks, charges, and expenses carefully before investing. For this and other important information, please obtain a Fund prospectus at no cost from your financial adviser and read it carefully before investing.

The table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions and redemption of Fund shares.

July 31, 2008 (Unaudited)

COMPARATIVE INDEX GRAPH

Comparison of change in value of a $10,000 investment in the Fund and the Lehman Brothers Municipal Bond Index

	Nebraska Municipal Fund without Sales Charge		Nebraska Municipal Fund with Maximum Sales Charge		Lehman Brothers Municipal Bond Index
7/31/98	$	10,000	$	9,578	$	10,000
1999	$	10,382	$	9,944	$	10,288
2000	$	10,619	$	10,171	$	10,732
2001	$	11,683	$	11,190	$	11,815
2002	$	12,158	$	11,645	$	12,608
2003	$	12,060	$	11,551	$	13,061
2004	$	12,492	$	11,965	$	13,816
2005	$	12,469	$	11,943	$	14,695
2006	$	13,080	$	12,528	$	15,071
2007	$	13,494	$	12,925	$	15,713
7/31/08	$	13,870	$	13,285	$	16,160

Putting Performance into Perspective

Performance data quoted above is historical. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. The principal value and investment return of an investment will fluctuate so that your shares, when redeemed, may be worth more or less than the original cost. You can obtain performance data current to the most recent month end (available within seven business days of the most recent month end) by calling 800-276-1262.

You should consider the Fund's investment objectives, risks, charges, and expenses carefully before investing. For this and other important information, please obtain a Fund prospectus at no cost from your financial adviser and read it carefully before investing.

The graph does not reflect the deduction of taxes that a shareholder would pay on Fund distributions and redemptions of Fund shares.

The graph comparing the Fund's performance to a benchmark index provides you with a general sense of how the Fund performed. To put this information in context, it may be helpful to understand the special differences between the two. The Lehman Brothers Municipal Bond Index is a national index representative of the national municipal bond market, whereas the Fund concentrates its investments in Nebraska municipal bonds. The Fund's total return for the periods shown appears with and without sales charges and includes Fund expenses and management fees. A securities index measures the performance of a theoretical portfolio. Unlike a fund, the index is unmanaged; there are no expenses that affect the results. In addition, few investors could purchase all of the securities necessary to match the index. If they could, they would incur transaction costs and other expenses. All Fund and benchmark returns include reinvested dividends.

July 31, 2008 (Unaudited)

MANAGEMENT OF THE FUND

The Board of the Fund consists of four Trustees. These same individuals, unless otherwise noted, also serve as Directors or Trustees for all of the funds in the Integrity family of funds, the six series of Integrity Managed Portfolios, and the three series of The Integrity Funds. Three Trustees (75% of the total) have no affiliation or business connection with Integrity Money Management or any of its affiliates; these are the "Independent" Trustees. Two of the remaining three Trustees and/or Officers are "interested" by virtue of their affiliation with Integrity Money Management and/or its affiliates.

The Independent Trustees of the Fund, their term of office and length of time served, their principal occupation(s) during the past five years, the number of portfolios overseen in the Fund Complex by each Independent Trustee, and other Directorships, if any, held outside the Fund Complex, are shown below.

INDEPENDENT TRUSTEES

NAME, ADDRESS, AND AGE	POSITION(S) HELD WITH REGISTRANT	TERM AND LENGTH SERVED	NUMBER OF PORTFOLIOS OVERSEEN IN THE FUND COMPLEX(1)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS	OTHER DIRECTORSHIPS HELD OUTSIDE THE FUND COMPLEX
Jerry M. Stai 2405 11th Ave. NW Minot, ND 58703 56	Trustee	Indefinite Since January 2006	12	Faculty, Embry-Riddle University (August 2000 to September 2005); Faculty, Park University (August 2005 to December 2005); Non-Profit Specialist, Bremer Bank (since July 2005); Faculty, Minot State University (since August 2000); Director, ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., Integrity Fund of Funds, Inc., (since January 2006); Trustee, The Integrity Funds (since January 2006).	Marycrest Franciscan Development, Inc.
Orlin W. Backes 948 13th Ave. SW Minot, ND 58701 73	Trustee	Indefinite Since January 1996	12	Attorney, McGee, Hankla, Backes & Dobrovolny, P.C.; Director, South Dakota Tax-Free Fund, Inc. (April 1995 to June 2004), ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., and Integrity Fund of Funds, Inc., (since April 2005); Trustee, The Integrity Funds (since June 2003).	First Western Bank & Trust
R. James Maxson 1 N. Main St. Minot, ND 58701 60	Trustee	Indefinite Since January 1999	12	Attorney, Maxson Law Office (since November 2002); Director, South Dakota Tax-Free Fund, Inc. (January 1999 to June 2004), Integrity Fund of Funds, Inc., ND Tax-Free Fund, Inc. and Montana Tax-Free Fund, Inc. (since January 1999); and Trustee, The Integrity Funds (since June 2003).	Vincent United Methodist Foundation Minot Area Development Corporation

⁽¹⁾ The Fund Complex consists of the three incorporated funds in the Integrity family of funds, the six series of Integrity Managed Portfolios, and the three series of The Integrity Funds.

Trustees and Officers of the Fund serve until their resignation, removal, or retirement.

The Statement of Additional Information ("SAI") contains more information about the Fund's Trustees and is available without charge upon request, by calling Integrity Funds Distributor at 800-276-1262.

The Interested Trustees and Officers of the Fund, their term of office and length of time served, their principal occupation(s) during the past five years, the number of portfolios overseen in the Fund Complex by each Interested Trustee, and other Directorships, if any, held outside the Fund Complex, are shown below.

INTERESTED TRUSTEE AND OFFICER

NAME, ADDRESS, AND AGE	POSITION(S) HELD WITH REGISTRANT	TERM AND LENGTH SERVED	NUMBER OF PORTFOLIOS OVERSEEN IN THE FUND COMPLEX(1)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS	OTHER DIRECTORSHIPS HELD OUTSIDE THE FUND COMPLEX
Robert E. Walstad(2)(3) 1 N. Main St. Minot, ND 58703 63	Trustee, Chairman, Interim President	Indefinite Since January 1996	12	Director (Sept. 1987 to Feb. 2007), CEO (Sept. 2001 to Feb. 2007), Integrity Mutual Funds; Director, President, and Treasurer, (Aug. 1988 to Feb. 2007), Integrity Money Management; Director, President, and Treasurer (Aug. 1988 to Sept. 2004), ND Capital, Inc.; Director, President, and Treasurer (May 1989 to Feb. 2007), Integrity Fund Services, Inc.; Director, President, CEO, and Treasurer, (Jan. 1996 to Aug. 2003), Integrity Funds Distributor, Inc.; Director, CEO, Chairman, (Jan. 2002 to Feb. 2007) and President (Sept. 2002 to Dec. 2004), Capital Financial Services, Inc.; Director and President, (April 1994 to June 2004) South Dakota Tax-Free Fund, Inc.; President (Jan. 1996 to July 2007) and (since March 2008) Integrity Managed Portfolios, (May 2003 to July 2007) and (since March 2008) The Integrity Funds, (Jan. 1995 to July 2007) and (since March 2008) Integrity Fund of Funds, Inc., (Jan. 1989 to July 2007) and (since March 2008) ND Tax-Free Fund, Inc., (Aug. 1993 to July 2007) and (since March 2008) Montana Tax-Free Fund, Inc.; Director and Chairman Montana Tax-Free Fund, Inc. (since May 1993), Integrity Fund of Funds, Inc. (since Aug. 1994), and ND Tax Free Fund, Inc. (since Oct. 1988); Trustee, Chairman, (since January 1996) and Treasurer (January 1996 to May 2004), Integrity Managed Portfolios; Trustee and Chairman (since June 2003), The Integrity Funds.	Minot Park Board

OFFICERS

NAME, ADDRESS, AND AGE	POSITION(S) HELD WITH REGISTRANT	TERM AND LENGTH SERVED	NUMBER OF PORTFOLIOS OVERSEEN IN THE FUND COMPLEX(1)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS	OTHER DIRECTORSHIPS HELD OUTSIDE THE FUND COMPLEX
Peter A. Quist 1 N. Main St. Minot, ND 58703 74	Vice President, Secretary	Indefinite Since January 1996	3	Attorney; Director and Vice President, Integrity Mutual Funds; Director, Vice President, and Secretary, Integrity Money Management, ND Capital, Inc. (August 1988 to August 2006), Integrity Fund Services, Inc., and Integrity Funds Distributor; Director, Vice President, and Secretary, South Dakota Tax-Free Fund, Inc. (April 1994 to June 2004), Montana Tax-Free Fund, Inc. (since May 1993), Integrity Fund of Funds, Inc. (since Aug. 1994), and ND Tax Free Fund, Inc. (since Oct. 1988); Vice President and Secretary, The Integrity Funds (since June 2003).	None
Adam C. Forthun 1 N. Main St. Minot, ND 32	Treasurer	Indefinite Since May 2008	N/A	Fund Accountant (May 2003 to October 2005), Fund Accounting Supervisor (October 2005 to March 2008), Fund Accounting Manager (since March 2008), Integrity Fund Services, Inc.; Treasurer (since May 2008), Integrity Managed Portfolios, The Integrity Funds, ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., and Integrity Fund of Funds, Inc.	None
Brent M. Wheeler 1 N. Main St. Minot, ND 58703 37	Mutual Fund Chief Compliance Officer	Indefinite Since October 2005	N/A	Fund Accounting Manager (May 1998 to October 2005), Integrity Fund Services, Inc.; Treasurer (May 2004 to October 2005), Mutual Fund Compliance Officer (since October 2005), Integrity Managed Portfolios, The Integrity Funds, ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., and Integrity Fund of Funds, Inc.	None

⁽¹⁾ The Fund Complex consists of the three incorporated funds in the Integrity family of funds, the six series of Integrity Managed Portfolios, and the three series of The Integrity Funds.

⁽²⁾ Trustees and/or Officers who are "interested persons" of the Fund as defined in the Investment Company Act of 1940, as amended (the "1940 Act"). Mr. Quist is an interested person by virtue of being an Officer and Director of the Fund's investment adviser and principal underwriter. Mr. Walstad is an interested person by virtue of being an Officer of the Fund and a shareholder of Integrity Mutual Funds.

⁽³⁾ Effective February 29, 2008, Mark R. Anderson resigned as President of the Fund, and effective March 4, 2008, Mr. Walstad succeeded Mr. Anderson as Interim President of the Fund. Mr. Walstad is also a Trustee and Chairman of the Fund.

Trustees and Officers of the Fund serve until their resignation, removal, or retirement.

The SAI contains more information about the Fund's Trustees and is available without charge upon request, by calling Integrity Funds Distributor at 800-276-1262.

Schedule of Investments July 31, 2008

Name of Issuer
Percentages represent the market value of each investment category to total net assets	Rating (Unaudited) Moody's/S&P	Coupon Rate	Maturity		Principal Amount		Market Value
NEBRASKA MUNICIPAL BONDS (95.9%)
Adams Cty., NE Hosp. Auth. #001 (Mary Lanning Memorial Hosp.) ASGUA	NR/A	5.300%	12/15/2018	$	250,000	$	252,517
Adams County Hospital Rev Mary Lanning Memorial Radian Insured	NR/A	5.250	12/15/2033		250,000		240,372
Dawson Cty., NE SID #001 (IBP, Inc. Proj.) Ref. G.O.	Baa/BBB-	5.650	02/01/2022		700,000		687,750
Dawson Cty., NE School Dist. #20 (Gothenburg) G.O. MBIA	A/AA	4.500	12/15/2025		405,000		393,445
Dawson Cty. Public Power Electric Sys. Rev.	NR/AA-	4.750	12/01/2032		250,000		234,442
*Dodge Cty., NE SD #001 (Fremont Public Schools) FSA	Aaa/NR	5.500	12/15/2020		1,000,000		1,074,010
Douglas Cty., NE G.O.	Aa-1/AA+	4.750	12/01/2025		250,000		250,585
Douglas Cty., NE Hosp. Auth. #001 (Alegent Hlth—Immanuel Med. Ctr.) Rev. AMBAC	Aa-3/AA	5.250	09/01/2021		250,000		255,062
Douglas Cty., NE (Catholic Health Corp.) Rev. MBIA	A/AA	5.500	11/15/2021		340,000		340,105
Douglas Cty., NE Hosp. Auth. #002 (Nebraska Medical Center)	Aa-3/NR	5.000	11/15/2016		250,000		265,105
Douglas Cty., NE (Catholic Health Corp.) Rev. MBIA	A/AA	5.375	11/15/2015		45,000		45,113
Douglas Cty., NE (Catholic Health Corp.) Rev. MBIA	A/AA	5.375	11/15/2015		220,000		220,000
Douglas County, NE Hosp. Methodist Health	NR/A-	5.500	11/01/2038		500,000		482,820
Douglas Cty., NE SID #392 (Cinnamon Creek) G.O.	NR/NR	5.750	08/15/2017		200,000		200,000
Douglas Cty., NE SID #397 (Linden Estates II)	NR/NR	5.600	07/15/2018		265,000		265,000
Douglas Cty., NE SID #397 (Linden Estates II)	NR/NR	5.600	07/15/2019		280,000		280,000
Douglas Cty., NE SID #397 (Linden Estates II)	NR/NR	5.600	04/01/2023		500,000		500,000
Douglas Cty., NE SD #010 (Elkhorn Pub. Schools) G.O. FSA Insured	NR/AAA	4.500	12/15/2023		250,000		245,565
Fremont, NE Combined Utilities Rev. MBIA	A/AA	5.000	10/15/2021		500,000		515,140
Hall Cty., NE School Dist. #2 Grand Island FSA	Aaa/AAA	5.000	12/15/2023		500,000		526,975
Kearney Cty., NE Highway Allocation Fund AMBAC	Aa-3/NR	5.350	06/15/2021		100,000		100,039
Lancaster Cnty Neb Hosp Auth No 1 (Bryanlg Med Center)	A-1/NR	4.000	06/01/2010		250,000		252,805
*Lancaster Cty., NE Hosp. Auth. #1 (BryanLGH Medical Center Project)	A-1/NR	4.750	06/01/2021		1,000,000		986,520
Lancaster Cty., NE School Dist. #1 (Lincoln Public Schools)	Aa-1/AAA	5.250	01/15/2021		500,000		524,610
Lancaster Cty., NE School Dist. #1 (Lincoln Public Schools) G.O.	Aa-1/AAA	5.250	01/15/2022		500,000		524,370
Lancaster Cty, NE School District #0160 (Norris Schools) G.O. FSA	Aaa/NR	5.000	12/15/2025		250,000		254,560
*Lincoln, NE Elec. Syst. Rev.	Aa/AA	5.000	09/01/2021		1,000,000		1,043,220
Lincoln, NE San. Swr. Rev. MBIA	Aa/AA+	4.500	06/15/2029		250,000		236,892
Lincoln, NE Water Rev.	Aa/AA-	5.000	08/15/2022		575,000		599,236
Madison Cty., NE Hosp. Auth. #001 (Faith Regl. Hlth. Svcs.) Rev. ASGUA	NR/A	5.350	07/01/2018		250,000		252,680
#Metropolitan Community College South Omaha Bldg. Proj. AMBAC	Aa-3/AA	4.500	03/01/2026		1,000,000		966,320
NE Hgr. Educ. Loan Program Senior Subord. Term MBIA	A/AA	6.250	06/01/2018		800,000		824,776
NE Hgr. Educ. Loan Program Junior Subord. Rev. MBIA	A/AA	6.400	06/01/2013		145,000		147,952
NE Hgr. Educ. Loan Program Junior Subord. Term MBIA	A/AA	6.450	06/01/2018		400,000		412,276
*NE Hgr. Educ. Loan Program Student Loan MBIA	A/AA	5.875	06/01/2014		765,000		765,803
NE Hgr. Educ. Loan Program B Rev. MBIA	A/AA	6.000	06/01/2028		100,000		100,039
#NE Educ. Finance Auth. (Wesleyan Univ.) Rev. Radian Insured	NR/A	5.500	04/01/2027		1,000,000		1,008,380
NE Invmt. Finance Auth. Single Family Hsg. Rev. GNMA/FNMA	NR/AAA	6.250	09/01/2028		5,000		5,037
NE Invmt. Finance Auth. Single Family Hsg. Rev. GNMA	NR/AAA	6.200	09/01/2017		5,000		5,037
*NE Invmt. Finance Auth. Single Family Hsg. Rev.	NR/AAA	6.300	09/01/2028		10,000		10,075
NE Invmt. Finance Auth. Multifamily Hsg. Rev. FNMA	NR/AAA	6.200	06/01/2028		135,000		135,019
NE Public Power District	Aaa/AAA	5.125	01/01/2011		300,000		306,420
NE Invmt. Finance Auth. (Great Plains Regional Medical Center) ASGUA	NR/A	5.450	11/15/2017		400,000		403,628
NE Invmt. Finance Auth. (Great Plains Regional Medical Center) Rev. Asset Guaranty	NR/A	5.450	11/15/2022		750,000		758,685
Omaha, NE Various Purpose	Aaa/AAA	5.000	05/01/2022		250,000		261,638
Omaha, NE Various Purpose	Aaa/AAA	4.250	10/15/2026		500,000		473,210
Omaha, NE Public Power Dist. Elec. Syst. Rev.	Aa-1/AA	5.200	02/01/2022		500,000		523,855
#Omaha, NE Public Power Electric Rev.	Aa-1/AA	5.000	02/01/2034		1,000,000		1,003,570
Omaha, NE Public Power Dist. Elec. Syst. Rev.	Aa/NR	6.200	02/01/2017		650,000		739,616
#Omaha, NE (Riverfront Project) Special Obligation	Aa-1/AA+	5.500	02/01/2029		1,000,000		1,046,390
Omaha, NE Public Power Dist. (Electric Rev) AMBAC	Aa-3/AA	4.750	02/01/2025		250,000		251,478
Omaha, NE Public Power Dist. (Electric Rev) AMBAC	Aa-3/AA	4.300	02/01/2031		100,000		88,996
Papillion, NE G.O. MBIA	A/AA	4.350	12/15/2027		250,000		233,840
Platte Cty., NE Hosp. Auth. No. 1 (Columbus Community Hospital Proj.) Hosp. Rev. Asset Guaranty	NR/A	5.650	05/01/2012		100,000		105,309
Platte Cty., NE Hosp. Auth. No. 1 (Columbus Community Hospital Proj.) Hosp. Rev. Asset Guaranty	NR/A	6.150	05/01/2030		250,000		257,063
Public Power Generation Agy Whelan Energy Rev AMBAC	Aa-3/AA	5.000	01/01/2032		500,000		488,235
Sarpy Cty., NE School Dist. #046 FSA	Aaa/AAA	5.000	12/15/2022		200,000		200,070
Saunders Cty., NE G.O. FSA	Aaa/AAA	5.000	11/01/2030		250,000		250,903
Saunders Cty., NE G.O. MBIA	A/AA	4.250	12/15/2021		515,000		497,495
University of NE Fac. Corp. Deferred Maintenance AMBAC	Aa/AA	5.000	07/15/2020		500,000		526,660
Univ. of NE Board of Regents Student Facs.	Aa/AA-	5.000	05/15/2032		250,000		250,900
Univ. of NE Board of Regents (Heath & Rec. Proj.)	Aa/AA-	5.000	05/15/2033		600,000		604,674
Univ. of NE (U. of NE - Lincoln Student Fees) Rev.	Aa/AA-	5.125	07/01/2032		250,000		252,998
Washington Cnty S/D#1 (Blair)	NR/A	3.750	12/15/2013		145,000		146,939
TOTAL NEBRASKA MUNICIPAL BONDS (COST: $25,860,438)						$	26,102,224
SHORT-TERM SECURITIES (3.0%)					Shares
Wells Fargo Advantage National Tax-Free Money Market (COST: $810,031)					810,031	$	810,031
TOTAL INVESTMENTS IN SECURITIES (COST: $26,670,469)						$	26,912,255
OTHER ASSETS LESS LIABILITIES							316,908
NET ASSETS						$	27,229,163

*Indicates bonds are segregated by the custodian to cover when-issued or delayed-delivery purchases.

#Indicates bonds are segregated by the custodian to cover initial margin requirements.

Footnote: Non-rated (NR) securities have been determined to be of investment grade quality by the Fund's Manager.

Various inputs are used in determining the value of the Fund's investments. These inputs are summarized in three broad levels:

Level 1—	quoted prices in active markets for identical securities
Level 2—	other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risks, etc.)
Level 3—	significant unobservable inputs (including the Fund's own assumptions in determining the fair value of investments)

The following is a summary of the inputs used to value the Fund's investments as of July 31, 2008:

Valuation Inputs	Investments in Securities
Level 1—Quoted Prices	$	810,031
Level 2—Other Significant Observable Inputs		26,102,224
Level 3—Significant Unobservable Inputs		—
Total	$	26,912,255

The accompanying notes are an integral part of these financial statements.

Financial Statements July 31, 2008

Statement of Assets and Liabilities
July 31, 2008

ASSETS
	Investments in securities, at value (cost: $26,670,469)		$	26,912,255
	Cash			1,800
	Accrued interest receivable			345,849
	Accrued dividends receivable			586
	Receivable for fund shares sold			100,000
	Receivable from manager			3,839
	Prepaid expenses			2,116
		Total Assets	$	27,366,445
LIABILITIES
	Dividends payable		$	84,735
	Payable for fund shares redeemed			10,200
	Accrued expenses			22,781
	Payable to affiliates			19,566
		Total Liabilities	$	137,282
NET ASSETS			$	27,229,163
Net assets are represented by:
	Paid-in capital		$	30,113,265
	Accumulated undistributed net realized gain (loss) on investments and futures			(3,157,412)
	Accumulated undistributed net investment income (loss)			31,524
	Unrealized appreciation (depreciation) on investments			241,786
		Total amount representing net assets applicable to 2,715,976 outstanding shares of no par common stock (unlimited shares authorized)	$	27,229,163
Net asset value per share			$	10.03
Public offering price (based on sales charge of 4.25%)			$	10.48

The accompanying notes are an integral part of these financial statements.

Financial Statements July 31, 2008

Statement of Operations
For the year ended July 31, 2008

INVESTMENT INCOME
	Interest		$	1,319,376
	Dividends			21,687
		Total Investment Income	$	1,341,063
EXPENSES
	Investment advisory fees		$	139,084
	Distribution (12b-1) fees			69,542
	Administrative service fees			34,771
	Transfer agent fees			55,634
	Accounting service fees			37,908
	Custodian fees			4,875
	Professional fees			15,404
	Trustees fees			3,558
	Insurance expense			736
	Reports to shareholders			3,070
	Audit fees			6,576
	Legal fees			21,129
	Transfer agent out-of-pockets			1,648
	License, fees, and registrations			2,447
		Total Expenses	$	396,382
	Less expenses waived or absorbed by the Fund's manager			(98,742)
		Total Net Expenses	$	297,640
NET INVESTMENT INCOME (LOSS)			$	1,043,423
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
	Net realized gain (loss) from investment transactions		$	49,200
	Net change in unrealized appreciation (depreciation) of investments			(330,857)
		Net Realized and Unrealized Gain (Loss) on Investments	$	(281,657)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS			$	761,766

The accompanying notes are an integral part of these financial statements.

Financial Statements July 31, 2008

Statement of Changes in Net Assets
For the year ended July 31, 2008 and the year ended July 31, 2007

			For The Year Ended July 31, 2008		For The Year Ended July 31, 2007
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
	Net investment income (loss)		$	1,043,423	$	1,136,418
	Net realized gain (loss) on investment transactions			49,200		101,063
	Net change in unrealized appreciation (depreciation) on investments			(330,857)		(289,997)
		Net Increase (Decrease) in Net Assets Resulting From Operations	$	761,766	$	947,484
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
	Dividends from net investment income ($.38 and $.39 per share, respectively)		$	(1,039,415)	$	(1,132,417)
	Distributions from net realized gain on investment transactions ($.00 and $.00 per share, respectively)			0		0
		Total Dividends and Distributions	$	(1,039,415)	$	(1,132,417)
CAPITAL SHARE TRANSACTIONS
	Proceeds from sale of shares		$	1,513,172	$	697,160
	Proceeds from reinvested dividends			707,111		755,442
	Cost of shares redeemed			(3,094,308)		(3,629,141)
		Net Increase (Decrease) in Net Assets Resulting from Capital Share Transactions	$	(874,025)	$	(2,176,539)
TOTAL INCREASE (DECREASE) IN NET ASSETS			$	(1,151,674)	$	(2,361,472)
NET ASSETS, BEGINNING OF PERIOD				28,380,837		30,742,309
NET ASSETS, END OF PERIOD			$	27,229,163	$	28,380,837
Undistributed Net Investment Income			$	31,524	$	28,868

The accompanying notes are an integral part of these financial statements.

Notes to Financial Statements July 31, 2008

Note 1. ORGANIZATION

The Fund is an investment portfolio of Integrity Managed Portfolios (the "Trust") and is registered under the Investment Company Act of 1940, as amended (the "1940 Act") as a non-diversified, open-end management investment company. The Trust may offer multiple portfolios; currently six portfolios are offered. The Trust is an unincorporated business trust organized under Massachusetts law on August 10, 1990. The Fund had no operations from that date to November 17, 1993, other than matters relating to organization and registration. On November 17, 1993, the Fund commenced its Public Offering of capital shares.

The investment objective of the Fund is to provide its shareholders with as high a level of current income exempt from both federal and Nebraska state income tax as is consistent with preservation of capital. The Fund will seek to achieve this objective by investing primarily in a portfolio of Nebraska municipal securities.

Shares of the Fund are offered at net asset value plus a maximum sales charge of 4.25% of the offering price.

Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Investment security valuation—Securities for which quotations are not readily available (which will constitute a majority of the securities held by the Fund) are valued using a matrix system at fair value as determined by Integrity Money Management. The matrix system has been developed based on procedures approved by the Board of Trustees and includes consideration of the following:

• yields or prices of municipal bonds of comparable quality;

• type of issue, coupon, maturity, and rating;

• indications as to value from dealers; and

• general market conditions.

Because the market value of securities can only be established by agreement between parties in a sales transaction, and because of the uncertainty inherent in the valuation process, the fair values as determined may differ from the values that would have been used had a ready market for the securities existed. The Fund follows industry practice and records security transactions on the trade date.

The Fund concentrates its investments in a single state. This concentration may result in the Fund investing a relatively high percentage of its assets in a limited number of issuers.

When-issued securities—The Fund may purchase securities on a when-issued basis. Payment and delivery may take place after the customary settlement period for that security. The price of the underlying securities and the date when the securities will be delivered and paid for are fixed at the time the transaction is negotiated. The value of the securities purchased on a when-issued basis are identified as such in the Fund's Schedule of Investments. With respect to purchase commitments, the Fund identifies securities as segregated in its records with a value at least equal to the amount of the commitment. Losses may arise due to changes in the value of the underlying securities or if the counterparty does not perform under the contract's terms, or if the issuer does not issue the securities due to political, economic, or other factors.

Contingent Deferred Sales Charge—In the case of investments of $1 million or more, a 1.00% CDSC may be assessed on shares redeemed within 24 months of purchase (excluding shares purchased with reinvested dividends and/or distributions).

Federal and state income taxes—The Fund's policy is to comply with the requirements of the Internal Revenue Code that are applicable to regulated investment companies and to distribute all of its net investment income and any net realized gain on investments to its shareholders. Therefore, no provision for income taxes is required. Distributions during the year ended July 31, 2008 were characterized as tax-exempt for tax purposes.

In June 2006, the Financial Accounting Standards Board ("FASB") issued Interpretation No. 48, "Accounting for Uncertainty in Income Taxes" ("FIN 48"). FIN 48 establishes the minimum threshold for recognizing, and a system for measuring, the benefits of tax-return positions taken on federal income tax returns for all open tax years (tax years ended July 31, 2004 through July 31, 2008) for purposes of implementing FIN 48, and has concluded that no provision for income tax is required in the Fund's financial statements. Interest and penalties related to uncertain tax positions, if any, are classified in the Fund's financial statements as other expense.

The tax character of distributions paid was as follows:

			July 31, 2008		July 31, 2007
Tax-exempt income		$	1,039,415	$	1,132,417
Ordinary income			0		0
Long-term capital gains			0		0
	Total	$	1,039,415	$	1,132,417

As of July 31, 2008, the components of accumulated earnings/(deficit) on a tax basis were as follows:

Undistributed Ordinary Income	Undistributed Long-Term Capital Gains	Undistributed Accumulated Earnings	Accumulated Capital and Other Losses	Unrealized Appreciation/ (Depreciation)	Total Accumulated Earnings/(Deficit)
$0	$0	$0	($3,157,412)	$273,310	($2,884,102)

The Fund has unexpired capital loss carryforwards for tax purposes as of July 31, 2008 totaling $3,157,412, which may be used to offset capital gains. Any difference between book-basis and tax-basis unrealized appreciation/(depreciation) is attributable to timing differences associated with market discount. The capital loss carryforward amounts will expire in each of the years ended July 31 as shown in the table below.

Year	Unexpired Capital Losses
2009	$148,986
2010	$591,993
2011	$713,949
2012	$579,276
2013	$1,123,208

For the year ended July 31, 2008, the Fund did not make any permanent reclassifications to reflect tax character.

Net capital losses incurred after October 31 and within the tax year are deemed to arise on the first business day of the Fund's next taxable year. For the year ended July 31, 2008, the Fund did not defer to August 1, 2008, any post-October capital losses, post-October currency losses, or post-October passive foreign investment company losses.

Distributions to shareholders—Dividends from net investment income, declared daily and paid monthly, are reinvested in additional shares of the Fund at net asset value or paid in cash. Capital gains, when available, are distributed at least annually.

Premiums and discounts—Premiums and discounts on municipal securities are amortized for financial reporting purposes.

Other—Income and expenses are recorded on the accrual basis. Investment transactions are accounted for on the trade date. Realized gains and losses are reported on the identified cost basis. Distributions to shareholders are recorded by the Fund on the ex-dividend date. Income and capital gain distributions are determined in accordance with federal income tax regulations and may differ from net investment income and realized gains determined in accordance with accounting principles generally accepted in the United States of America. These differences are primarily due to differing treatments for market discount, capital loss carryforwards, and losses due to wash sales and futures transactions.

Permanent book and tax basis differences relating to shareholder distributions will result in reclassifications to paid-in capital. Temporary book and tax basis differences will reverse in a subsequent period.

Futures contracts—The Fund may purchase and sell financial futures contracts to hedge against changes in the values of tax-exempt municipal securities the Fund owns or expects to purchase.

A futures contract is an agreement between two parties to buy or sell units of a particular index or a certain amount of U.S. government or municipal securities at a set price on a future date. Upon entering into a futures contract, the Fund is required to deposit with a broker an amount of cash or securities equal to the minimum "initial margin" requirement of the futures exchange on which the contract is traded. Subsequent payments ("variation margin") are made or received by the Fund, dependent on the fluctuations in the value of the underlying index. Daily fluctuations in value are recorded for financial reporting purposes as unrealized gains or losses by the Fund. When entering into a closing transaction, the Fund will realize, for book purposes, a gain or loss equal to the difference between the value of the futures contracts sold and the futures contracts to buy. Unrealized appreciation (depreciation) related to open futures contracts is required to be treated as realized gain (loss) for federal income tax purposes.

Securities held in collateralized accounts to cover initial margin requirements on open futures contracts are noted in the Schedule of Investments. The Statement of Assets and Liabilities reflects a receivable or payable for the daily mark to market for variation margin.

Certain risks may arise upon entering into futures contracts. These risks may include changes in the value of the futures contracts that may not directly correlate with changes in the value of the underlying securities.

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

Note 3. CAPITAL SHARE TRANSACTIONS

As of July 31, 2008, there were unlimited shares of no par authorized; 2,715,976 and 2,801,059 shares were outstanding at July 31, 2008 and July 31, 2007, respectively.

Transactions in capital shares were as follows:

	Shares
	For The Year Ended July 31, 2008	For The Year Ended July 31, 2007
Shares sold	149,795	68,577
Shares issued on reinvestment of dividends	69,816	73,768
Shares redeemed	(304,694)	(354,984)
Net increase (decrease)	(85,083)	(212,639)

Note 4. INVESTMENT ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES

Integrity Money Management, the Fund's investment adviser; Integrity Funds Distributor, the Fund's underwriter; and Integrity Fund Services, Inc. ("Integrity Fund Services"), the Fund's transfer, accounting, and administrative services agent; are subsidiaries of Integrity Mutual Funds, the Fund's sponsor.

The Fund has engaged Integrity Money Management to provide investment advisory and management services to the Fund. The Investment Advisory Agreement provides for fees to be computed at an annual rate of 0.50% of the Fund's average daily net assets. The Fund has recognized $47,942 of investment advisory fees after partial waiver for the year ended July 31, 2008. The Fund does not have a payable to Integrity Money Management at July 31, 2008 for investment advisory fees. Certain Officers and Trustees of the Fund are also Officers and Directors of Integrity Money Management.

Under the terms of the advisory agreement, Integrity Money Management has agreed to pay all the expenses of the Fund (excluding taxes and brokerage fees and commissions, if any) that exceed 1.07% of the Fund's average daily net assets on an annual basis up to the amount of the investment advisory and management fee. Accordingly, after fee waivers and expense reimbursements, the Fund's actual total annual operating expenses were 1.07% for the year ended July 31, 2008.

Principal underwriter and shareholder services

Integrity Funds Distributor serves as the principal underwriter for the Fund. The Fund has adopted a distribution plan as allowed by Rule 12b-1 of the 1940 Act. Distribution plans permit the Fund to reimburse its principal underwriter for costs related to selling shares of the Fund and for various other services. These costs, which consist primarily of commissions and service fees to broker-dealers who sell shares of the Fund, are paid by shareholders through expenses called "Distribution Plan expenses". The Fund currently pays an annual distribution fee of up to 0.25% of the average daily net assets of the Fund. Distribution Plan expenses are calculated daily and paid monthly. The Fund has recognized $69,542 of distribution fees for the year ended July 31, 2008. The Fund has a payable to Integrity Funds Distributor of $5,626 at July 31, 2008 for distribution fees.

Integrity Fund Services, the transfer agent, provides shareholder services for a variable fee equal to 0.20% of the Fund's average daily net assets on an annual basis for the Fund's first $50 million and at a lower rate on the average daily net assets in excess of $50 million, with a minimum of $2,000 per month plus reimbursement of out-of-pocket expenses. An additional fee with a minimum of $500 per month is charged for each additional share class. The Fund has recognized $55,634 of transfer agency fees and expenses for the year ended July 31, 2008. The Fund has a payable to Integrity Fund Services of $4,500 at July 31, 2008 for transfer agency fees. Integrity Fund Services also acts as the Fund's accounting services agent for a monthly fee equal to the sum of a fixed fee of $2,000, and a variable fee equal to 0.05% of the Fund's average daily net assets on an annual basis for the Fund's first $50 million and at a lower rate on the average daily net assets in excess of $50 million. An additional fee with a minimum of $500 per month is charged for each additional share class. The Fund has recognized $37,908 of accounting service fees for the year ended July 31, 2008. The Fund has a payable to Integrity Fund Services of $3,125 at July 31, 2008 for accounting service fees. Integrity Fund Services also acts as the Fund's administrative services agent for a variable fee equal to 0.125% of the Fund's average daily net assets on an annual basis for the Fund's first $50 million and at a lower rate on the average daily net assets in excess of $50 million, with a minimum of $2,000 per month plus out-of-pocket expenses. An additional fee with a minimum of $500 per month will be charged for each additional share class. The Fund has recognized $34,771 of administrative service fees for the year ended July 31, 2008. The Fund has a payable to Integrity Fund Services of $2,813 at July 31, 2008 for administrative service fees.

Note 5. INVESTMENT SECURITY TRANSACTIONS

The cost of purchases and proceeds from the sales of investment securities (excluding short-term securities) aggregated $2,786,900 and $4,126,200, respectively, for the year ended July 31, 2008.

Note 6. INVESTMENT IN SECURITIES

At July 31, 2008, the aggregate cost of securities for federal income tax purposes was substantially the same for financial reporting purposes at $26,670,469. The net unrealized appreciation of investments based on the cost was $241,786, which is comprised of $491,179 aggregate gross unrealized appreciation and $249,393 aggregate gross unrealized depreciation. Differences between financial reporting-basis and tax-basis unrealized appreciation/(depreciation) are due to differing treatment of market discount.

Note 7. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In September 2006, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards (SFAS) No. 157 Fair Value Measurements. This standard defines fair value, and establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands disclosures about fair value measurements. The standard is effective for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years.

In accordance with the provisions of SFAS No. 157, the Fund adopted this standard during the current fiscal year. The implementation of the standard did not impact the amounts reported in the financial statements.

In March 2008, FASB issued SFAS No. 161 Disclosures about Derivative Instruments and Hedging Activities. This standard requires enhanced disclosures to provide information about the reasons the Fund invests in derivative instruments, the accounting treatment and the effect derivatives have on financial performance. The standard is effective for fiscal years beginning after November 15, 2008, and interim periods within those fiscal years. Management is currently evaluating the impact the adoption of SFAS No. 161 will have on the Fund's financial statement disclosures.

Financial Highlights July 31, 2008

Selected per share data and ratios for the periods indicated

				For The Year Ended July 31, 2008		For The Year Ended July 31, 2007		For The Year Ended July 31, 2006		For The Year Ended July 29, 2005		For The Year Ended July 30, 2004
NET ASSET VALUE, BEGINNING OF PERIOD			$	10.13	$	10.20	$	10.11	$	10.55	$	10.62
Income from Investment Operations:
	Net investment income (loss)		$	.38	$	.39	$	.40	$	.42	$	.45
	Net realized and unrealized gain (loss) on investment and futures transactions			(.10)		(.07)		.09		(.44)		(.07)
		Total Income (Loss) From Investment Operations	$	.28	$	.32	$	.49	$	(.02)	$	.38
Less Distributions:
	Dividends from net investment income		$	(.38)	$	(.39)	$	(.40)	$	(.42)	$	(.45)
	Distributions from net realized gains			.00		.00		.00		.00		.00
		Total Distributions	$	(.38)	$	(.39)	$	(.40)	$	(.42)	$	(.45)
NET ASSET VALUE, END OF PERIOD			$	10.03	$	10.13	$	10.20	$	10.11	$	10.55
Total Return				2.79%(A)		3.16(A)		4.90%(A)		(0.18%)(A)		3.59%(A)
RATIOS/SUPPLEMENTAL DATA:
	Net assets, end of period (in thousands)		$	27,229	$	28,381	$	30,742	$	32,488	$	34,682
	Ratio of net expenses (after expense assumption) to average net assets			1.07%(B)		1.07%(B)		1.03%(B)		0.98%(B)		0.95%(B)
	Ratio of net investment income to average net assets			3.74%		3.81%		3.89%		4.07%		4.18%
	Portfolio turnover rate			10.42%		17.42%		14.63%		4.36%		8.95%

^(A)Excludes maximum sales charge of 4.25%.

^(B)During the periods indicated above, Integrity Money Management assumed and/or waived expenses of $98,742, $81,123, $66,312, $84,449, and $93,640, respectively. If the expenses had not been assumed and/or waived, the annualized ratio of total expenses to average net assets would have been 1.43%, 1.34%, 1.24%, 1.22%, and 1.21%, respectively.

Total return represents the rate that an investor would have earned or lost on an investment in the Fund assuming reinvestment of all dividends and distributions.

The accompanying notes are an integral part of these financial statements.

Tax Information for the Year Ended July 31, 2008 (Unaudited)

We are required to advise you within 60 days of the Fund's fiscal year regarding the federal tax status of distributions received by shareholders during such fiscal year. The distributions made during the fiscal year by the Fund were earned from the following sources:

		Dividends and Distributions Per Share
To Shareholders of Record	Payment Date		From Net Investment Income	From Net Realized Short-Term Gains	From Net Realized Long-Term Gains
August 31, 2007	August 31, 2007	$	.032590	.0	.0
September 28, 2007	September 28, 2007	$	.029594	.0	.0
October 31, 2007	October 31, 2007	$	.034200	.0	.0
November 30, 2007	November 30, 2007	$	.031403	.0	.0
December 31, 2007	December 31, 20007	$	.032254	.0	.0
January 31, 2008	January 31, 2008	$	.031803	.0	.0
February 29, 2008	February 29, 2008	$	.030856	.0	.0
March 31, 2008	March 31, 2008	$	.030623	.0	.0
April 30, 2008	April 30, 2008	$	.031367	.0	.0
May 30, 2008	May 30, 2008	$	.031344	.0	.0
June 30, 2008	June 30, 2008	$	.031457	.0	.0
July 31, 2008	July 31, 2008	$	.031591	.0	.0

Shareholders should consult their tax advisors.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Trustees of the Nebraska Municipal Fund

We have audited the accompanying statement of assets and liabilities of the Nebraska Municipal Fund (one of the portfolios constituting the Integrity Managed Portfolios), including the schedule of investments as of July 31, 2008, the related statement of operations for the year then ended, the statement of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended. These financial statements and financial highlights are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of July 31, 2008 by correspondence with the custodian and brokers. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Nebraska Municipal Fund of the Integrity Managed Portfolios as of July 31, 2008, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.

BRADY, MARTZ & ASSOCIATES, P.C.
Minot, North Dakota USA

September 12, 2008

Dear Shareholder:

Enclosed is the report of the operations for the New Hampshire Municipal Fund (the "Fund") for the year ended July 31, 2008. The Fund's portfolio and related financial statements are presented within for your review.

As we end the year, what one might have thought was an uneventful year was much the opposite.

First, interest rates spiked higher early in June as Federal Reserve Chairman Ben Bernanke voiced concern about inflation and the slumping dollar. However, a string of weak economic reports in the last part of June (consumer confidence plunged to its lowest level since 1992) along with more losses and downgrades in the banking sector, reduced corporate earnings expectations as well as higher energy prices have encouraged market participants to dump stocks in favor of low-risk government bonds, sending the 10-year treasury to 3.95%

Second, while the market likes to talk about light at the end of the tunnel, unfortunately in these days of financial turmoil we can never be sure whether it is light from the other side or another freight train coming. Most recently, Fannie Mae and Freddie Mac who own or guarantee nearly half of the $12 trillion mortgage market have seen their company stocks fall 75-80% year-to-date, as the worst housing downturn since the Great Depression impacted expected solvency levels.

Municipals on the other hand didn't fare any better as a number of the secondary insurers saw significant downgrades of their ratings, the collapse of major financial institution Bear Stearns and the exit of UBS from the municipal bond market.

The secondary insurers of municipal debt are in turmoil as a number of the insurance companies are in dire straits. Many bond professionals and investors, who in the past treated all insured bonds equal from a credit perspective, now understand the importance of the underlying credit, the purpose of the debt issued, and its commitment to pay. Currently there are three insurers of municipal debt that have AAA ratings from all three rating agencies and two of those three insurers are on Credit Watch for possible downgrade.

These events have created great uncertainty and with that, opportunity. It is now a buyers market as high quality municipals are yielding in many instances, yields higher than taxable treasuries of similar maturities. Clearly there will be price rallies and price sell offs in the months ahead, but the underlying tone for tax-free municipals is bullish.

The New Hampshire Municipal Fund began the period at $10.24 and ended the period at $10.32 for a total return of 3.72%*. This compares to the Lehman Brothers Municipal Bond Index return of 2.84%.

The Fund's yearly overall performance can be attributed to its defensive portfolio, with an average maturity of 8.7 years and an average maturity to the first call date of 4.1 years. That, along with an average portfolio coupon of 4.87% helps relative performance in volatile environments.

An important part of the Fund's strategy includes searching the primary and secondary markets for high quality, double tax-exempt issues. Some purchases made throughout the year include: Manchester Water, 5.00% coupon, due 2028; N.H. State Capital Improvement, 4.75% coupon, due 2027; N.H. Housing, 4.90% coupon, due 2025; and Merrimack County General Obligations, 4.25% coupon, due 2019.

Portfolio quality at year-end was as follows: AAA 12.0%, AA 57.3% and A 30.7%.

Income exempt from federal income taxes and New Hampshire state interest and dividend taxes with preservation of capital remain the primary objectives of the Fund.

If you would like more frequent updates, visit the Fund's website at www.integrityfunds.com for daily prices along with pertinent Fund information.

Sincerely,

Monte Avery
Senior Portfolio Manager

The views expressed are those of Monte Avery, Senior Portfolio Manager with Integrity Mutual Funds, Inc. ("Integrity Mutual Funds"). The views are subject to change at any time in response to changing circumstances in the market and are not intended to predict or guarantee the future performance of any individual security, market sector, the markets generally, or any Integrity Mutual Fund.

*Performance does not include applicable front-end or contingent deferred sales charges ("CDSCs"), which would have reduced the performance.

Performance data quoted above is historical. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. The principal value and investment return of an investment will fluctuate so that your shares, when redeemed, may be worth more or less than the original cost. You can obtain performance data current to the most recent month end (available within seven business days of the most recent month end) by calling 800-276-1262.

You should consider the Fund's investment objectives, risks, charges, and expenses carefully before investing. For this and other important information, please obtain a Fund prospectus at no cost from your financial adviser and read it carefully before investing.

Bond prices and, therefore, the value of bond funds decline as interest rates rise. Because the Fund invests in securities of a single state, the Fund is more susceptible to factors adversely impacting the respective state securities more so than a municipal bond fund that does not concentrate its securities in a single state.

July 31, 2008 (Unaudited)

PROXY VOTING OF FUND PORTFOLIO SECURITIES

A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to securities held in the Fund's portfolio is available, without charge and upon request, by calling 800-276-1262. A report on Form N-PX of how the Fund voted any such proxies during the most recent twelve-month period ended June 30 is available through the Fund's website at www.integrityfunds.com. The information is also available from the Electronic Data Gathering, Analysis, and Retrieval ("EDGAR") database on the website of the Securities and Exchange Commission ("SEC") at www.sec.gov.

QUARTERLY PORTFOLIO SCHEDULE

Within 60 days of the end of its second and fourth fiscal quarters, the Fund provides a complete schedule of portfolio holdings in its semi-annual and annual reports on the Form N-CSR(S). These reports are filed electronically with the SEC and are delivered to the shareholders of the Fund. The Fund also files its 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 Forms N-Q and N-CSR(S) are available on the SEC's website at www.sec.gov. The Fund's Forms N-Q and N-CSR(S) 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 202-942-8090. You may also access this information from the Fund's website at www.integrityfunds.com.

SHAREHOLDER INQUIRIES AND MAILINGS

All inquiries regarding the Fund should be directed to:

Integrity Funds Distributor, Inc.
1 Main Street North
Minot, ND 58703
Phone: 800-276-1262

All inquiries regarding account information should be directed to:

Integrity Fund Services, Inc.
P.O. Box 759
Minot, ND 58702
Phone: 800-601-5593

To reduce expenses, the Fund may only mail one copy of its prospectus and each annual and semi-annual report to those addresses shared by two or more accounts. If you wish to receive individual copies of these documents, please call Integrity Funds Distributor, Inc. ("Integrity Funds Distributor") at 800-276-1262 (or contact your financial institution). Individual copies will be sent thirty days after receiving your request.

Terms & Definitions July 31, 2008 (Unaudited)

Appreciation

Increase in the value of an asset

Average Annual Total Return

A standardized measurement of the return (yield and appreciation) earned by a fund on an annual basis assuming all distributions are reinvested

Coupon Rate or Face Rate

Rate of interest payable annually based on the face amount of the bond; expressed as a percentage

Depreciation

Decrease in the value of an asset

Lehman Brothers Municipal Bond Index

An unmanaged list of long-term, fixed-rate, investment-grade, tax-exempt bonds representative of the municipal bond market; the index does not take into account brokerage commissions or other costs, may include bonds different from those in the Fund, and may pose different risks than the Fund

Market Value

Actual (or estimated) price at which a bond trades in the marketplace

Maturity

A measure of the term or life of a bond in years; when a bond "matures", the issuer repays the principal

Net Asset Value

The value of all of a fund's assets, minus any liabilities, divided by the number of outstanding shares, not including any initial sales charge

Quality Ratings

A designation assigned by independent rating companies to give a relative indication of a bond's creditworthiness; "AAA," "AA," "A," and "BBB" indicate investment grade securities. Ratings can range from a high of "AAA" to a low of "D".

Total Return

Measures both the net investment income and any realized and unrealized appreciation or depreciation of the underlying investments in a fund's portfolio for the period, assuming the reinvestment of all dividends; represents the aggregate percentage or dollar value change over the period

July 31, 2008 (Unaudited)

COMPOSITION

Portfolio Quality Ratings
(Based on total long-term investments)

AAA	12.0%
AA	57.3%
A	30.7%

Quality ratings reflect the financial strength of the issuer. They are assigned by independent ratings services such as Moody's Investors Services ("Moody's") and Standard & Poor's Ratings Group ("S&P"). Non-rated bonds have been determined to be of appropriate quality for the portfolio by Integrity Money Management, Inc. ("Integrity Money Management"), the Fund's investment adviser.

These percentages are subject to change.

Portfolio Market Sectors
(As a percentage of Net Assets)

T—Transportation	39.3%
O—Other	15.6%
GO—General Obligations	14.7%
HC—Health Care	12.5%
S—School	7.6%
H—Housing	5.2%
I—Industrial	5.1%

Market sectors are breakdowns of the Fund's portfolio holdings into specific investment classes.

These percentages are subject to change.

July 31, 2008 (Unaudited)

DISCLOSURE OF FUND EXPENSES

The example below is intended to describe the fees and expenses borne by shareholders and the impact of those costs on your investment.

EXAMPLE

As a shareholder of the Fund, you incur two types of costs:

•	transaction costs:	sales charges (loads), redemption fees, and exchange fees
•	ongoing costs:	management fees, distribution (12b-1) fees, and other Fund expenses

This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period from January 31, 2008 to July 31, 2008.

The example illustrates the Fund's costs in two ways:

Actual expenses

The section in the table under the heading "Actual" provides information about actual account values and actual expenses. You may use the information in these columns together with the amount you invested to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an account value of $8,600 divided by $1,000 equals 8.6), then multiply the result by the number in the column entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period.

Hypothetical example for comparison purposes

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

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees, or exchange fees. Therefore, the section in the table under the heading "Hypothetical (5% return before expenses)" is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

	Beginning Account Value 01/31/08	Ending Account Value 07/31/08		Expenses Paid During Period*
Actual	$1,000.00	$	997.54	$5.34
Hypothetical (5% return before expenses)	$1,000.00	$	1,019.51	$5.40

*Expenses are equal to the annualized expense ratio of 1.07%, multiplied by the average account value over the period, multiplied by 180/360 days. The Fund's ending account value on the first line in the table is based on its actual total return of (0.25%) for the six-month period of January 31, 2008 to July 31, 2008.

July 31, 2008 (Unaudited)

AVERAGE ANNUAL TOTAL RETURNS

		For periods ending July 31, 2008
New Hampshire Municipal Fund		1 year	3 year	5 year	10 year	Since Inception (December 31, 1992)
	Without Sales Charge	3.72%	3.50%	2.66%	3.43%	4.43%
	With Sales Charge (4.25%)	(0.65%)	2.02%	1.78%	2.98%	4.14%
Lehman Brothers Municipal Bond Index		1 year	3 year	5 year	10 year	Since Inception (December 31, 1992)
		2.84%	3.22%	4.35%	4.92%	5.70%

Putting Performance into Perspective

Performance data quoted above is historical. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. The principal value and investment return of an investment will fluctuate so that your shares, when redeemed, may be worth more or less than the original cost. You can obtain performance data current to the most recent month end (available within seven business days of the most recent month end) by calling 800-276-1262.

You should consider the Fund's investment objectives, risks, charges, and expenses carefully before investing. For this and other important information, please obtain a Fund prospectus at no cost from your financial adviser and read it carefully before investing.

The table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions and redemption of Fund shares.

The Fund's performance prior to December 19, 2003 was achieved while the Fund was managed by another investment adviser that used different investment strategies and techniques, which may have produced different investment results than those achieved by the current investment adviser. Forum Investment Advisors, LLC served as investment adviser to the Fund until December 19, 2003.

July 31, 2008 (Unaudited)

COMPARATIVE INDEX GRAPH

Comparison of change in value of a $10,000 investment in the Fund and the Lehman Brothers Municipal Bond Index

	New Hampshire Municipal Fund without Sales Charge		New Hampshire Municipal Fund with Maximum Sales Charge		Lehman Brothers Municipal Bond Index
7/31/98	$	10,000	$	9,573	$	10,000
1999	$	10,267	$	9,829	$	10,288
2000	$	10,631	$	10,177	$	10,732
2001	$	11,413	$	10,926	$	11,815
2002	$	12,009	$	11,496	$	12,608
2003	$	12,289	$	11,765	$	13,061
2004	$	12,872	$	12,322	$	13,816
2005	$	12,639	$	12,100	$	14,695
2006	$	13,114	$	12,554	$	15,071
2007	$	13,511	$	12,934	$	15,713
7/31/08	$	14,013	$	13,415	$	16,160

Putting Performance into Perspective

Performance data quoted above is historical. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. The principal value and investment return of an investment will fluctuate so that your shares, when redeemed, may be worth more or less than the original cost. You can obtain performance data current to the most recent month end (available within seven business days of the most recent month end) by calling 800-276-1262.

You should consider the Fund's investment objectives, risks, charges, and expenses carefully before investing. For this and other important information, please obtain a Fund prospectus at no cost from your financial adviser and read it carefully before investing.

The graph does not reflect the deduction of taxes that a shareholder would pay on Fund distributions and redemptions of Fund shares.

The graph comparing the Fund's performance to a benchmark index provides you with a general sense of how the Fund performed. To put this information in context, it may be helpful to understand the special differences between the two. The Lehman Brothers Municipal Bond Index is a national index representative of the national municipal bond market, whereas the Fund concentrates its investments in New Hampshire municipal bonds. The Fund's total return for the periods shown appears with and without sales charges and includes Fund expenses and management fees. A securities index measures the performance of a theoretical portfolio. Unlike a fund, the index is unmanaged; there are no expenses that affect the results. In addition, few investors could purchase all of the securities necessary to match the index. If they could, they would incur transaction costs and other expenses. All Fund and benchmark returns include reinvested dividends.

July 31, 2008 (Unaudited)

MANAGEMENT OF THE FUND

The Board of the Fund consists of four Trustees. These same individuals, unless otherwise noted, also serve as Directors or Trustees for all of the funds in the Integrity family of funds, the six series of Integrity Managed Portfolios, and the three series of The Integrity Funds. Three Trustees (75% of the total) have no affiliation or business connection with Integrity Money Management or any of its affiliates; these are the "Independent" Trustees. Two of the remaining three Trustees and/or Officers are "interested" by virtue of their affiliation with Integrity Money Management and/or its affiliates.

The Independent Trustees of the Fund, their term of office and length of time served, their principal occupation(s) during the past five years, the number of portfolios overseen in the Fund Complex by each Independent Trustee, and other Directorships, if any, held outside the Fund Complex, are shown below.

INDEPENDENT TRUSTEES

NAME, ADDRESS, AND AGE	POSITION(S) HELD WITH REGISTRANT	TERM AND LENGTH SERVED	NUMBER OF PORTFOLIOS OVERSEEN IN THE FUND COMPLEX(1)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS	OTHER DIRECTORSHIPS HELD OUTSIDE THE FUND COMPLEX
Jerry M. Stai 2405 11th Ave. NW Minot, ND 58703 56	Trustee	Indefinite Since January 2006	12	Faculty, Embry-Riddle University (August 2000 to September 2005); Faculty, Park University (August 2005 to December 2005); Non-Profit Specialist, Bremer Bank (since July 2005); Faculty, Minot State University (since August 2000); Director, ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., Integrity Fund of Funds, Inc., (since January 2006); Trustee, The Integrity Funds (since January 2006).	Marycrest Franciscan Development, Inc.
Orlin W. Backes 948 13th Ave. SW Minot, ND 58701 73	Trustee	Indefinite Since January 1996	12	Attorney, McGee, Hankla, Backes & Dobrovolny, P.C.; Director, South Dakota Tax-Free Fund, Inc. (April 1995 to June 2004), ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., and Integrity Fund of Funds, Inc., (since April 2005); Trustee, The Integrity Funds (since June 2003).	First Western Bank & Trust
R. James Maxson 1 N. Main St. Minot, ND 58701 60	Trustee	Indefinite Since January 1999	12	Attorney, Maxson Law Office (since November 2002); Director, South Dakota Tax-Free Fund, Inc. (January 1999 to June 2004), Integrity Fund of Funds, Inc., ND Tax-Free Fund, Inc. and Montana Tax-Free Fund, Inc. (since January 1999); and Trustee, The Integrity Funds (since June 2003).	Vincent United Methodist Foundation Minot Area Development Corporation

⁽¹⁾ The Fund Complex consists of the three incorporated funds in the Integrity family of funds, the six series of Integrity Managed Portfolios, and the three series of The Integrity Funds.

Trustees and Officers of the Fund serve until their resignation, removal, or retirement.

The Statement of Additional Information ("SAI") contains more information about the Fund's Trustees and is available without charge upon request, by calling Integrity Funds Distributor at 800-276-1262.

The Interested Trustees and Officers of the Fund, their term of office and length of time served, their principal occupation(s) during the past five years, the number of portfolios overseen in the Fund Complex by each Interested Trustee, and other Directorships, if any, held outside the Fund Complex, are shown below.

INTERESTED TRUSTEE AND OFFICER

NAME, ADDRESS, AND AGE	POSITION(S) HELD WITH REGISTRANT	TERM AND LENGTH SERVED	NUMBER OF PORTFOLIOS OVERSEEN IN THE FUND COMPLEX(1)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS	OTHER DIRECTORSHIPS HELD OUTSIDE THE FUND COMPLEX
Robert E. Walstad(2),(3) 1 N. Main St. Minot, ND 58703 63	Trustee, Chairman, Interim President	Indefinite Since January 1996	12	Director (Sept. 1987 to Feb. 2007), CEO (Sept. 2001 to Feb. 2007), Integrity Mutual Funds; Director, President, and Treasurer, (Aug. 1988 to Feb. 2007), Integrity Money Management; Director, President, and Treasurer (Aug. 1988 to Sept. 2004), ND Capital, Inc.; Director, President, and Treasurer (May 1989 to Feb. 2007), Integrity Fund Services, Inc.; Director, President, CEO, and Treasurer, (Jan. 1996 to Aug. 2003), Integrity Funds Distributor, Inc.; Director, CEO, Chairman, (Jan. 2002 to Feb. 2007) and President (Sept. 2002 to Dec. 2004), Capital Financial Services, Inc.; Director and President, (April 1994 to June 2004) South Dakota Tax-Free Fund, Inc.; President (Jan. 1996 to July 2007) and (since March 2008) Integrity Managed Portfolios, (May 2003 to July 2007) and (since March 2008) The Integrity Funds, (Jan. 1995 to July 2007) and (since March 2008) Integrity Fund of Funds, Inc., (Jan. 1989 to July 2007) and (since March 2008) ND Tax-Free Fund, Inc., (Aug. 1993 to July 2007) and (since March 2008) Montana Tax-Free Fund, Inc.; Director and Chairman Montana Tax-Free Fund, Inc. (since May 1993), Integrity Fund of Funds, Inc. (since Aug. 1994), and ND Tax Free Fund, Inc. (since Oct. 1988); Trustee, Chairman, (since January 1996) and Treasurer (January 1996 to May 2004), Integrity Managed Portfolios; Trustee and Chairman (since June 2003), The Integrity Funds.	Minot Park Board

OFFICERS

NAME, ADDRESS, AND AGE	POSITION(S) HELD WITH REGISTRANT	TERM AND LENGTH SERVED	NUMBER OF PORTFOLIOS OVERSEEN IN THE FUND COMPLEX(1)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS	OTHER DIRECTORSHIPS HELD OUTSIDE THE FUND COMPLEX
Peter A. Quist 1 N. Main St. Minot, ND 58703 74	Vice President, Secretary	Indefinite Since January 1996	3	Attorney; Director and Vice President, Integrity Mutual Funds; Director, Vice President, and Secretary, Integrity Money Management, ND Capital, Inc. (August 1988 to August 2006), Integrity Fund Services, Inc., and Integrity Funds Distributor; Director, Vice President, and Secretary, South Dakota Tax-Free Fund, Inc. (April 1994 to June 2004), Montana Tax-Free Fund, Inc. (since May 1993), Integrity Fund of Funds, Inc. (since Aug. 1994), and ND Tax Free Fund, Inc. (since Oct. 1988); Vice President and Secretary, The Integrity Funds (since June 2003).	None
Adam C. Forthun 1 N. Main St. Minot, ND 32	Treasurer	Indefinite Since May 2008	N/A	Fund Accountant (May 2003 to October 2005), Fund Accounting Supervisor (October 2005 to March 2008), Fund Accounting Manager (since March 2008), Integrity Fund Services, Inc.; Treasurer (since May 2008), Integrity Managed Portfolios, The Integrity Funds, ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., and Integrity Fund of Funds, Inc.	None
Brent M. Wheeler 1 N. Main St. Minot, ND 58703 37	Mutual Fund Chief Compliance Officer	Indefinite Since October 2005	N/A	Fund Accounting Manager (May 1998 to October 2005), Integrity Fund Services, Inc.; Treasurer (May 2004 to October 2005), Mutual Fund Compliance Officer (since October 2005), Integrity Managed Portfolios, The Integrity Funds, ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., and Integrity Fund of Funds, Inc.	None

⁽¹⁾ The Fund Complex consists of the three incorporated funds in the Integrity family of funds, the six series of Integrity Managed Portfolios, and the three series of The Integrity Funds.

⁽²⁾ Trustees and/or Officers who are "interested persons" of the Fund as defined in the Investment Company Act of 1940, as amended (the "1940 Act"). Mr. Quist is an interested person by virtue of being an Officer and Director of the Fund's investment adviser and principal underwriter. Mr. Walstad is an interested person by virtue of being an Officer of the Fund and a shareholder of Integrity Mutual Funds.

⁽³⁾ Effective February 29, 2008, Mark R. Anderson resigned as President of the Fund, and effective March 4, 2008, Mr. Walstad succeeded Mr. Anderson as Interim President of the Fund. Mr. Walstad is also a Trustee and Chairman of the Fund.

Trustees and Officers of the Fund serve until their resignation, removal, or retirement.

The SAI contains more information about the Fund's Trustees and is available without charge upon request, by calling Integrity Funds Distributor at 800-276-1262.

Schedule of Investments July 31, 2008

Name of Issuer
Percentages represent the market value of each investment category to total net assets	Rating (Unaudited) Moody's/S&P	Coupon Rate	Maturity		Principal Amount		Market Value
NEW HAMPSHIRE MUNICIPAL BONDS (89.7%)
#Belknap Cty., NH G.O. MBIA	A-1/AA	5.200%	06/15/2013	$	225,000	$	227,309
Concord, NH G.O.	Aa/AA	4.600	10/15/2014		100,000		105,569
*Derry, NH FSA	Aaa/NR	4.800	02/01/2018		115,000		120,827
Gorham, NH G.O. FSA	Aaa/NR	4.850	04/01/2014		65,000		67,015
#Hampton, NH G.O. XLCA	A-1/NR	4.000	12/15/2020		200,000		193,326
Hillsborough, NH G.O. XLCA	NR/A	4.000	11/01/2020		100,000		98,776
Hillsborough, NH G.O. XLCA	NR/A	4.000	11/01/2021		100,000		97,505
Hudson, NH School District Lot B	Aa-3/NR	7.300	12/15/2008		20,000		20,422
Manchester, NH Public Improvement	Aa/NR	5.875	05/01/2019		50,000		51,880
#Manchester, NH Airport Rev. MBIA	A/AA	5.000	01/01/2009		225,000		227,502
*Manchester, NH School Facs. Rev. MBIA	Aa-3/AA	5.250	06/01/2009		250,000		257,688
Manchester, NH Water Rev. FGIC	Aa-3/AA	5.000	12/01/2028		100,000		100,846
Merrimack Cty., NH G.O. FSA	NR/AAA	4.250	12/01/2019		100,000		101,586
Merrimack Cty., NH G.O. FSA	NR/AAA	4.500	12/01/2027		100,000		98,010
Nashua, NH G.O.	Aa/AA+	5.250	09/15/2017		100,000		107,353
New Hampshire Hlth. & Educ. Facs. Auth. (Exeter)	A/A+	5.100	10/01/2010		100,000		104,434
New Hampshire Hlth. & Educ. Facs. Auth. (Exeter)	A/A+	5.200	10/01/2011		60,000		62,768
*New Hampshire Hlth. & Educ. Facs. Auth. (Exeter)	A/A+	5.500	10/01/2015		120,000		126,116
New Hampshire Hlth. & Educ. Facs. Auth. (Exeter)	A/A+	5.625	10/01/2016		20,000		21,112
#New Hampshire Hlth. & Educ. Facs. Auth. (Univ. Sys. of NH) AMBAC	Aa-3/AA	5.500	07/01/2013		40,000		43,358
New Hampshire Hlth. & Educ. Facs. Auth. (Univ. Sys. of NH) AMBAC	Aa-3/AA	5.500	07/01/2013		95,000		102,526
*New Hampshire State Capital Improvement G.O.	Aa/AA	5.000	04/15/2013		250,000		269,030
New Hampshire State Capital Improvement G.O.	Aa/AA	4.750	03/01/2027		100,000		100,999
New Hampshire State Hsg. Single Fam. Rev.	Aa/NR	4.900	07/01/2025		200,000		183,070
Portsmouth, NH G.O. MBIA	Aa/AA	4.000	08/01/2019		100,000		99,644
*Rochester, NH G.O. MBIA	A/NR	4.750	07/15/2020		300,000		312,327
TOTAL NEW HAMPSHIRE MUNICIPAL BONDS						$	3,300,998
GUAM MUNICIPAL BONDS (0.3%)
Guam Hsg. Corp. Single Family Mtg.	NR/AAA	5.750	09/01/2031		10,000	$	9,793
TOTAL MUNICIPAL BONDS (COST: $3,294,620)						$	3,310,791
SHORT-TERM SECURITIES (9.4%)					Shares
Wells Fargo Advantage National Tax-Free Money Market (Cost: $347,524)					347,524	$	347,524
TOTAL INVESTMENTS IN SECURITIES (COST: $3,642,144)						$	3,658,315
OTHER ASSETS MINUS LIABILITIES							22,584
NET ASSETS						$	3,680,899

*Indicates bonds are segregated by the custodian to cover when-issued or delayed delivery purchases.

#Indicates bonds are segregated by the custodian to cover initial margin requirements.

Footnote: Non-rated (NR) securities have been determined to be of investment grade quality by the Fund's Manager.

Various inputs are used in determining the value of the Fund's investments. These inputs are summarized in three broad levels:

Level 1—	quoted prices in active markets for identical securities
Level 2—	other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risks, etc.)
Level 3—	significant unobservable inputs (including the Fund's own assumptions in determining the fair value of investments)

The following is a summary of the inputs used to value the Fund's investments as of July 31, 2008:

Valuation Inputs	Investments in Securities
Level 1—Quoted Prices	$	347,524
Level 2—Other Significant Observable Inputs		3,310,791
Level 3—Significant Unobservable Inputs		—
Total	$	3,658,315

The accompanying notes are an integral part of these financial statements.

Financial Statements July 31, 2008

Statement of Assets and Liabilities
July 31, 2008

ASSETS
	Investments in securities, at value (cost: $3,642,144)		$	3,658,315
	Accrued interest receivable			41,799
	Accrued dividends receivable			573
	Receivable from manager			6,514
	Prepaid expenses			1,279
		Total Assets	$	3,708,480
LIABILITIES
	Dividends payable		$	8,236
	Accrued expenses			12,377
	Payable to affiliates			6,968
		Total Liabilities	$	27,581
NET ASSETS			$	3,680,899
Net assets are represented by:
	Paid-in capital		$	3,810,768
	Accumulated undistributed net realized gain (loss) on investments and futures			(148,062)
	Accumulated undistributed net investment income (loss)			2,022
	Unrealized appreciation (depreciation) on investments			16,171
		Total amount representing net assets applicable to 356,507 outstanding shares of no par common stock (unlimited shares authorized)	$	3,680,899
Net asset value per share			$	10.32
Public offering price (based on sales charge of 4.25%)			$	10.78

The accompanying notes are an integral part of these financial statements.

Financial Statements July 31, 2008

Statement of Operations
For the year ended July 31, 2008

INVESTMENT INCOME
	Interest		$	144,922
	Dividends			9,569
		Total Investment Income	$	154,491
EXPENSES
	Investment advisory fees		$	19,560
	Distribution (12b-1) fees			9,778
	Administrative service fees			24,001
	Transfer agent fees			24,001
	Accounting service fees			25,956
	Custodian fees			1,911
	Professional fees			5,613
	Trustees fees			1,791
	Insurance expense			105
	Reports to shareholders			1,240
	Audit fees			6,576
	Legal fees			3,039
	Transfer agent out-of-pockets			287
	License, fees, and registrations			1,430
		Total Expenses	$	125,288
	Less expenses waived or absorbed by the Fund's manager			(83,438)
		Total Net Expenses	$	41,850
NET INVESTMENT INCOME (LOSS)			$	112,641
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
	Net realized gain (loss) from investment transactions		$	(529)
	Net change in unrealized appreciation (depreciation) of investments			30,921
		Net Realized and Unrealized Gain (Loss) on Investments	$	30,392
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS			$	143,033

The accompanying notes are an integral part of these financial statements.

Financial Statements July 31, 2008

Statement of Changes in Net Assets
For the year ended July 31, 2008 and the year ended July 31, 2007

			For The Year Ended July 31, 2008		For The Year Ended July 31, 2007
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
	Net investment income (loss)		$	112,641	$	148,624
	Net realized gain (loss) on investment transactions			(529)		6,631
	Net change in unrealized appreciation (depreciation) on investments			30,921		(792)
		Net Increase (Decrease) in Net Assets Resulting From Operations	$	143,033	$	154,463
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
	Dividends from net investment income ($.30 and $.32 per share, respectively)		$	(112,395)	$	(148,272)
	Distributions from net realized gain on investment transactions ($.00 and $.00 per share, respectively)			0		0
		Total Dividends and Distributions	$	(112,395)	$	(148,272)
CAPITAL SHARE TRANSACTIONS
	Proceeds from sale of shares		$	219,028	$	24,360
	Proceeds from reinvested dividends			54,708		77,717
	Cost of shares redeemed			(811,941)		(1,236,445)
		Net Increase (Decrease) in Net Assets Resulting from Capital Share Transactions	$	(538,205)	$	(1,134,368)
TOTAL INCREASE (DECREASE) IN NET ASSETS			$	(507,567)	$	(1,128,177)
NET ASSETS, BEGINNING OF PERIOD				4,188,466		5,316,643
NET ASSETS, END OF PERIOD			$	3,680,899	$	4,188,466
Undistributed Net Investment Income			$	2,022	$	1,776

The accompanying notes are an integral part of these financial statements.

Notes to Financial Statements July 31, 2008

Note 1. ORGANIZATION

The Fund is an investment portfolio of Integrity Managed Portfolios (the "Trust") and is registered under the Investment Company Act of 1940, as amended (the "1940 Act") as a non-diversified, open-end management investment company. The Trust may offer multiple portfolios; currently six portfolios are offered. The Trust is an unincorporated business trust organized under Massachusetts law on August 10, 1990.

The investment objective of the Fund is to provide its shareholders with as high a level of current income exempt from both federal income tax and New Hampshire state interest and dividend tax as is consistent with preservation of capital. The Fund will seek to achieve this objective by investing primarily in a portfolio of New Hampshire municipal securities.

On December 19, 2003 the Fund became a series of the Trust. Prior to this date, the Fund was part of the Forum Funds and was named the New Hampshire TaxSaver Bond Fund. The New Hampshire TaxSaver Bond Fund commenced operations on December 31, 1992. The Forum Funds is a Delaware business trust that is registered as an open-end management investment company under the 1940 Act.

Shares of the Fund are offered at net asset value plus a maximum sales charge of 4.25% of the offering price.

Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Investment security valuation—Securities for which quotations are not readily available (which will constitute a majority of the securities held by the Fund) are valued using a matrix system at fair value as determined by Integrity Money Management. The matrix system has been developed based on procedures approved by the Board of Trustees and includes consideration of the following:

• yields or prices of municipal bonds of comparable quality;

• type of issue, coupon, maturity, and rating;

• indications as to value from dealers; and

• general market conditions.

Because the market value of securities can only be established by agreement between parties in a sales transaction, and because of the uncertainty inherent in the valuation process, the fair values as determined may differ from the values that would have been used had a ready market for the securities existed. The Fund follows industry practice and records security transactions on the trade date.

The Fund concentrates its investments in a single state. This concentration may result in the Fund investing a relatively high percentage of its assets in a limited number of issuers.

When-issued securities—The Fund may purchase securities on a when-issued basis. Payment and delivery may take place after the customary settlement period for that security. The price of the underlying securities and the date when the securities will be delivered and paid for are fixed at the time the transaction is negotiated. The value of the securities purchased on a when-issued basis are identified as such in the Fund's Schedule of Investments. With respect to purchase commitments, the Fund identifies securities as segregated in its records with a value at least equal to the amount of the commitment. Losses may arise due to changes in the value of the underlying securities or if the counterparty does not perform under the contract's terms, or if the issuer does not issue the securities due to political, economic, or other factors.

Contingent Deferred Sales Charge—In the case of investments of $1 million or more, a 1.00% CDSC may be assessed on shares redeemed within 24 months of purchase (excluding shares purchased with reinvested dividends and/or distributions).

Federal and state income taxes—The Fund's policy is to comply with the requirements of the Internal Revenue Code that are applicable to regulated investment companies and to distribute all of its net investment income and any net realized gain on investments to its shareholders. Therefore, no provision for income taxes is required. Distributions during the year ended July 31, 2008 were characterized as tax-exempt for tax purposes.

In June 2006, the Financial Accounting Standards Board ("FASB") issued Interpretation No. 48, "Accounting for Uncertainty in Income Taxes" ("FIN 48"). FIN 48 establishes the minimum threshold for recognizing, and a system for measuring, the benefits of tax-return positions taken on federal income tax returns for all open tax years (tax years ended July 31, 2004 through July 31, 2008) for purposes of implementing FIN 48, and has concluded that no provision for income tax is required in the Fund's financial statements. Interest and penalties related to uncertain tax positions, if any, are classified in the Fund's financial statements as other expense.

The tax character of distributions paid was as follows:

			July 31, 2008		July 31, 2007
Tax-exempt income		$	112,395	$	148,272
Ordinary income			0		0
Long-term capital gains			0		0
	Total	$	112,395	$	148,272

As of July 31, 2008, the components of accumulated earnings/(deficit) on a tax basis were as follows:

Undistributed Ordinary Income	Undistributed Long-Term Capital Gains	Undistributed Accumulated Earnings	Accumulated Capital and Other Losses	Unrealized Appreciation/ (Depreciation)	Total Accumulated Earnings/(Deficit)
$0	$0	$0	($148,062)	$18,193	($129,869)

The Fund has unexpired capital loss carryforwards for tax purposes as of July 31, 2008 totaling $148,062, which may be used to offset capital gains. Any difference between book-basis and tax-basis unrealized appreciation/(depreciation) is attributable to timing differences associated with market discount. The capital loss carryforward amounts will expire in each of the years ended July 31 as shown in the table below.

Year	Unexpired Capital Losses
2013	$147,534
2016	$528

For the year ended July 31, 2008, the Fund did not make any permanent reclassifications to reflect tax character.

Net capital losses incurred after October 31 and within the tax year are deemed to arise on the first business day of the Fund's next taxable year. For the year ended July 31, 2008, the Fund did not defer to August 1, 2008, any post-October capital losses, post-October currency losses, or post-October passive foreign investment company losses.

Distributions to shareholders—Dividends from net investment income, declared daily and paid monthly, are reinvested in additional shares of the Fund at net asset value or paid in cash. Capital gains, when available, are distributed at least annually.

Premiums and discounts—Premiums and discounts on municipal securities are amortized for financial reporting purposes.

Other—Income and expenses are recorded on the accrual basis. Investment transactions are accounted for on the trade date. Realized gains and losses are reported on the identified cost basis. Distributions to shareholders are recorded by the Fund on the ex-dividend date. Income and capital gain distributions are determined in accordance with federal income tax regulations and may differ from net investment income and realized gains determined in accordance with accounting principles generally accepted in the United States of America. These differences are primarily due to differing treatments for market discount, capital loss carryforwards, and losses due to wash sales and futures transactions.

Permanent book and tax basis differences relating to shareholder distributions will result in reclassifications to paid-in capital. Temporary book and tax basis differences will reverse in a subsequent period.

Futures contracts—The Fund may purchase and sell financial futures contracts to hedge against changes in the values of tax-exempt municipal securities the Fund owns or expects to purchase.

A futures contract is an agreement between two parties to buy or sell units of a particular index or a certain amount of U.S. government or municipal securities at a set price on a future date. Upon entering into a futures contract, the Fund is required to deposit with a broker an amount of cash or securities equal to the minimum "initial margin" requirement of the futures exchange on which the contract is traded. Subsequent payments ("variation margin") are made or received by the Fund, dependent on the fluctuations in the value of the underlying index. Daily fluctuations in value are recorded for financial reporting purposes as unrealized gains or losses by the Fund. When entering into a closing transaction, the Fund will realize, for book purposes, a gain or loss equal to the difference between the value of the futures contracts sold and the futures contracts to buy. Unrealized appreciation (depreciation) related to open futures contracts is required to be treated as realized gain (loss) for federal income tax purposes.

Securities held in collateralized accounts to cover initial margin requirements on open futures contracts are noted in the Schedule of Investments. The Statement of Assets and Liabilities reflects a receivable or payable for the daily mark to market for variation margin.

Certain risks may arise upon entering into futures contracts. These risks may include changes in the value of the futures contracts that may not directly correlate with changes in the value of the underlying securities.

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

Note 3. CAPITAL SHARE TRANSACTIONS

As of July 31, 2008, there were unlimited shares of no par authorized; 356,507 and 408,879 shares were outstanding at July 31, 2008 and July 31, 2007, respectively.

Transactions in capital shares were as follows:

	For The Year Ended July 31, 2008	For The Year Ended July 31, 2007
Shares sold	20,945	2,358
Shares issued on reinvestment of dividends	5,298	7,535
Shares redeemed	(78,615)	(119,810)
Net increase (decrease)	(52,372)	(109,917)

Note 4. INVESTMENT ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES

Integrity Money Management, the Fund's investment adviser; Integrity Funds Distributor, the Fund's underwriter; and Integrity Fund Services, Inc. ("Integrity Fund Services"), the Fund's transfer, accounting, and administrative services agent; are subsidiaries of Integrity Mutual Funds, the Fund's sponsor.

The Fund has engaged Integrity Money Management to provide investment advisory and management services to the Fund. The Investment Advisory Agreement provides for fees to be computed at an annual rate of 0.50% of the Fund's average daily net assets. The Fund has recognized no investment advisory fees for the year ended July 31, 2008. Certain Officers and Trustees of the Fund are also Officers and Directors of Integrity Money Management.

Under the terms of the advisory agreement, Integrity Money Management has agreed to pay all the expenses of the Fund (excluding taxes and brokerage fees and commissions, if any ) that exceed 1.07% of the Fund's average daily net assets on an annual basis up to the amount of the investment advisory and management fee. Accordingly, after fee waivers and expense reimbursements, the Fund's actual total annual operating expenses were 1.07% for the year ended July 31, 2008.

Principal underwriter and shareholder services

Integrity Funds Distributor serves as the principal underwriter for the Fund. The Fund has adopted a distribution plan as allowed by Rule 12b-1 of the 1940 Act. Distribution plans permit the Fund to reimburse its principal underwriter for costs related to selling shares of the Fund and for various other services. These costs, which consist primarily of commissions and service fees to broker-dealers who sell shares of the Fund, are paid by shareholders through expenses called "Distribution Plan expenses". The Fund currently pays an annual distribution fee of up to 0.25% of the average daily net assets of the Fund. Distribution Plan expenses are calculated daily and paid monthly. The Fund has recognized $9,778 of distribution fees for the year ended July 31, 2008. The Fund has a payable to Integrity Funds Distributor of $771 at July 31, 2008 for distribution fees.

Integrity Fund Services, the transfer agent, provides shareholder services for a variable fee equal to 0.20% of the Fund's average daily net assets on an annual basis for the Fund's first $50 million and at a lower rate on the average daily net assets in excess of $50 million, with a minimum of $2,000 per month plus reimbursement of out-of-pocket expenses. An additional fee with a minimum of $500 per month is charged for each additional share class. The Fund has recognized $24,001 of transfer agency fees and expenses for the year ended July 31, 2008. The Fund has a payable to Integrity Fund Services of $2,000 at July 31, 2008 for transfer agency fees. Integrity Fund Services also acts as the Fund's accounting services agent for a monthly fee equal to the sum of a fixed fee of $2,000, and a variable fee equal to 0.05% of the Fund's average daily net assets on an annual basis for the Fund's first $50 million and at a lower rate on the average daily net assets in excess of $50 million. An additional fee with a minimum of $500 per month is charged for each additional share class. The Fund has recognized $25,956 of accounting service fees for the year ended July 31, 2008. The Fund has a payable to Integrity Fund Services of $2,154 at July 31, 2008 for accounting service fees. Integrity Fund Services also acts as the Fund's administrative services agent for a variable fee equal to 0.125% of the Fund's average daily net assets on an annual basis for the Fund's first $50 million and at a lower rate on the average daily net assets in excess of $50 million, with a minimum of $2,000 per month plus out-of-pocket expenses. An additional fee with a minimum of $500 per month will be charged for each additional share class. The Fund has recognized $24,001 of administrative service fees for the year ended July 31, 2008. The Fund has a payable to Integrity Fund Services of $2,000 at July 31, 2008 for administrative service fees.

Note 5. INVESTMENT SECURITY TRANSACTIONS

The cost of purchases and proceeds from the sales of investment securities (excluding short-term securities) aggregated $440,548 and $940,506, respectively, for the year ended July 31, 2008.

Note 6. INVESTMENT IN SECURITIES

At July 31, 2008, the aggregate cost of securities for federal income tax purposes was substantially the same for financial reporting purposes at $3,642,144. The net unrealized appreciation of investments based on the cost was $16,171, which is comprised of $38,583 aggregate gross unrealized appreciation and $22,412 aggregate gross unrealized depreciation. Differences between financial reporting-basis and tax-basis unrealized appreciation/(depreciation) are due to differing treatment of market discount.

Note 7. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In September 2006, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards (SFAS) No. 157 Fair Value Measurements. This standard defines fair value, and establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands disclosures about fair value measurements. The standard is effective for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years.

In accordance with the provisions of SFAS No. 157, the Fund adopted this standard during the current fiscal year. The implementation of the standard did not impact the amounts reported in the financial statements.

In March 2008, FASB issued SFAS No. 161 Disclosures about Derivative Instruments and Hedging Activities. This standard requires enhanced disclosures to provide information about the reasons the Fund invests in derivative instruments, the accounting treatment and the effect derivatives have on financial performance. The standard is effective for fiscal years beginning after November 15, 2008, and interim periods within those fiscal years. Management is currently evaluating the impact the adoption of SFAS No. 161 will have on the Fund's financial statement disclosures.

Financial Highlights July 31, 2008

Selected per share data and ratios for the periods indicated

				For The Year Ended July 31, 2008		For The Year Ended July 31, 2007		For The Year Ended July 31, 2006		For The Year Ended July 29, 2005		For The Four Month Period Ended July 30, 2004		For The Year Ended March 31, 2004
NET ASSET VALUE, BEGINNING OF PERIOD			$	10.24	$	10.25	$	10.20	$	10.82	$	10.73	$	10.88
Income from Investment Operations:
	Net investment income (loss)		$	.30	$	.32	$	.33	$	.33	$	.11	$	.37
	Net realized and unrealized gain (loss) on investment and futures transactions			.08		(.01)		.05		(.52)		.09		(.15)
		Total Income (Loss) From Investment Operations	$	.38	$	.31	$	.38	$	(.19)	$	.20	$	.22
Less Distributions:
	Dividends from net investment income		$	(.30)	$	(.32)	$	(.33)	$	(.33)	$	(.11)	$	(.37)
	Distributions from net realized gains			.00		.00		.00		(.10)		.00		.00
		Total Distributions	$	(.30)	$	(.32)	$	(.33)	$	(.43)	$	(.11)	$	(.37)
NET ASSET VALUE, END OF PERIOD			$	10.32	$	10.24	$	10.25	$	10.20	$	10.82	$	10.73
Total Return				3.72%(A)		3.02%(A)		3.76%(A)		(1.81%)(A)		5.69%(A)(C)		2.06%(A)
RATIOS/SUPPLEMENTAL DATA:
	Net assets, end of period (in thousands)		$	3,681	$	4,188	$	5,317	$	6,363	$	7,962	$	8,175
	Ratio of net expenses (after expense assumption) to average net assets			1.07%(B)		1.07%(B)		1.03%(B)		0.98%(B)		0.95(B)(C)		0.95%(B)
	Ratio of net investment income to average net assets			2.87%		3.09%		3.19%		3.14%		3.12%(C)		3.44%
	Portfolio turnover rate			12.56%		11.83%		8.10%		17.94%		10.02%		41.53%

^(A) Excludes maximum sales charge of 4.25%.

^(B) During the periods since March 31, 2004, Integrity Money Management assumed/waived expenses of $83,438, $79,544, $69,311, $64,102, and $23,856, respectively. If the expenses had not been assumed and/or waived, the annualized ratio of total expenses to average net assets would have been 3.20%, 2.72%, 2.22%, 1.80%, and 1.84%, respectively. For the period 4/1/2003 through 12/19/2003, Forum Administrative Services assumed/waived expenses of $62,210. For the period from 12/20/2003 through 3/31/2004, Integrity Money Management assumed/waived expenses of $21,859. If the expenses had not been assumed and/or waived, the annualized ratio of total expenses to average net assets for the year would have been 1.86%.

^(C) Ratio is annualized.

Total return represents the rate that an investor would have earned or lost on an investment in the Fund assuming reinvestment of all dividends and distributions.

The accompanying notes are an integral part of these financial statements.

Tax Information for the Year Ended July 31, 2008 (Unaudited)

We are required to advise you within 60 days of the Fund's fiscal year regarding the federal tax status of distributions received by shareholders during such fiscal year. The distributions made during the fiscal year by the Fund were earned from the following sources:

		Dividends and Distributions Per Share
To Shareholders of Record	Payment Date		From Net Investment Income	From Net Realized Short-Term Gains	From Net Realized Long-Term Gains
August 31, 2007	August 31, 2007	$	.026008	.0	.0
September 28, 2007	September 28, 2007	$	.024542	.0	.0
October 31, 2007	October 31, 2007	$	.027598	.0	.0
November 30, 2007	November 30, 2007	$	.025804	.0	.0
December 31, 2007	December 31, 2007	$	.025616	.0	.0
January 31, 2008	January 31, 2008	$	.024538	.0	.0
February 29, 2008	February 29, 2008	$	.023661	.0	.0
March 31, 2008	March 31, 2008	$	.024567	.0	.0
April 30, 2008	April 30, 2008	$	.023994	.0	.0
May 30, 2008	May 30, 2008	$	.024427	.0	.0
June 30, 2008	June 30, 2008	$	.023690	.0	.0
July 31, 2008	July 31, 2008	$	.023043	.0	.0

Shareholders should consult their tax advisors.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Trustees of the New Hampshire Municipal Fund

We have audited the accompanying statement of assets and liabilities of the New Hampshire Municipal Fund (one of the portfolios constituting the Integrity Managed Portfolios), including the schedule of investments as of July 31, 2008, the related statement of operations for the year then ended, the statement of changes in net assets for each of the two years in the period then ended, and the financial highlights for the years ended July 31, 2008, July 31, 2007, July 31, 2006, and July 29, 2005, the four month period ended July 30, 2004, and the year ended March 31, 2004. These financial statements and financial highlights are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of July 31, 2008 by correspondence with the custodian and brokers. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the New Hampshire Municipal Fund of the Integrity Managed Portfolios as of July 31, 2008, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for the years ended July 31, 2008, July 31, 2007, July 31, 2006, and July 29, 2005, the four month period ended July 30, 2004, and the year ended March 31, 2004, in conformity with accounting principles generally accepted in the United States of America.

BRADY, MARTZ & ASSOCIATES, P.C.
Minot, North Dakota USA

September 12, 2008

Dear Shareholder:

Enclosed is the report of the operations for the Oklahoma Municipal Fund (the "Fund") for the year ended July 31, 2008. The Fund's portfolio and related financial statements are presented within for your review.

As we end the year, what one might have thought was an uneventful year was much the opposite.

First, interest rates spiked higher early in June as Federal Reserve Chairman Ben Bernanke voiced concern about inflation and the slumping dollar. However, a string of weak economic reports in the last part of June (consumer confidence plunged to its lowest level since 1992) along with more losses and downgrades in the banking sector, reduced corporate earnings expectations as well as higher energy prices have encouraged market participants to dump stocks in favor of low-risk government bonds, sending the 10-year treasury to 3.95%

Second, while the market likes to talk about light at the end of the tunnel, unfortunately in these days of financial turmoil we can never be sure whether it is light from the other side or another freight train coming. Most recently, Fannie Mae and Freddie Mac who own or guarantee nearly half of the $12 trillion mortgage market have seen their company stocks fall 75-80% year-to-date, as the worst housing downturn since the Great Depression impacted expected solvency levels.

Municipals on the other hand didn't fare any better as a number of the secondary insurers saw significant downgrades of their ratings, the collapse of major financial institution Bear Stearns and the exit of UBS from the municipal bond market.

The secondary insurers of municipal debt are in turmoil as a number of the insurance companies are in dire straits. Many bond professionals and investors, who in the past treated all insured bonds equal from a credit perspective, now understand the importance of the underlying credit, the purpose of the debt issued, and its commitment to pay. Currently there are three insurers of municipal debt that have AAA ratings from all three rating agencies and two of those three insurers are on Credit Watch for possible downgrade.

These events have created great uncertainty and with that, opportunity. It is now a buyers market as high quality municipals are yielding in many instances, yields higher than taxable treasuries of similar maturities. Clearly there will be price rallies and price sell offs in the months ahead, but the underlying tone for tax-free municipals is bullish.

The Oklahoma Municipal Fund began the period at $11.03 and ended the period at $10.75 for a total return of 1.01%*. This compares to the Lehman Brothers Municipal Bond Index return of 2.84%.

We are pleased to report that Lipper Reporting Service has ranked the Oklahoma Municipal Fund the number one fund in the Other States Municipal Debt Funds category over three years for the period ended June 30, 2008.

The Fund's yearly overall performance can be attributed to its defensive portfolio, with an average maturity of 18.3 years and an average maturity to the first call date of 6.0 years. That, along with an average portfolio coupon of 5.01% helps relative performance in volatile environments.

An important part of the Fund's strategy includes searching the primary and secondary markets for high quality, double tax-exempt issues. Some purchases made throughout the year include: Glenpool Utility, 5.00% coupon, due 2027; Tulsa Public Facilities, 5.25% coupon, due 2036; Oklahoma Housing, 5.00% coupon, due 2017; and Oklahoma City Water Utility, 5.00% coupon, due 2034.

Portfolio quality at year-end was as follows: AAA 18.7%, AA 55.8%, A 14.5%, BBB 5.5% and NR 5.5%.

Income exempt from federal and Oklahoma state income taxes with preservation of capital remain the primary objectives of the Fund.

If you would like more frequent updates, visit the Fund's website at www.integrityfunds.com for daily prices along with pertinent Fund information.

Sincerely,

Monte Avery
Senior Portfolio Manager

The views expressed are those of Monte Avery, Senior Portfolio Manager with Integrity Mutual Funds, Inc. ("Integrity Mutual Funds"). The views are subject to change at any time in response to changing circumstances in the market and are not intended to predict or guarantee the future performance of any individual security, market sector, the markets generally, or any Integrity Mutual Fund.

*Performance does not include applicable front-end or contingent deferred sales charges ("CDSCs"), which would have reduced the performance.

Performance data quoted above is historical. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. The principal value and investment return of an investment will fluctuate so that your shares, when redeemed, may be worth more or less than the original cost. You can obtain performance data current to the most recent month end (available within seven business days of the most recent month end) by calling 800-276-1262.

You should consider the Fund's investment objectives, risks, charges, and expenses carefully before investing. For this and other important information, please obtain a Fund prospectus at no cost from your financial adviser and read it carefully before investing.

Bond prices and, therefore, the value of bond funds decline as interest rates rise. Because the Fund invests in securities of a single state, the Fund is more susceptible to factors adversely impacting the respective state securities more so than a municipal bond fund that does not concentrate its securities in a single state.

July 31, 2008 (Unaudited)

PROXY VOTING OF FUND PORTFOLIO SECURITIES

A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to securities held in the Fund's portfolio is available, without charge and upon request, by calling 800-276-1262. A report on Form N-PX of how the Fund voted any such proxies during the most recent twelve-month period ended June 30 is available through the Fund's website at www.integrityfunds.com. The information is also available from the Electronic Data Gathering, Analysis, and Retrieval ("EDGAR") database on the website of the Securities and Exchange Commission ("SEC") at www.sec.gov.

QUARTERLY PORTFOLIO SCHEDULE

Within 60 days of the end of its second and fourth fiscal quarters, the Fund provides a complete schedule of portfolio holdings in its semi-annual and annual reports on the Form N-CSR(S). These reports are filed electronically with the SEC and are delivered to the shareholders of the Fund. The Fund also files its 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 Forms N-Q and N-CSR(S) are available on the SEC's website at www.sec.gov. The Fund's Forms N-Q and N-CSR(S) 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 202-942-8090. You may also access this information from the Fund's website at www.integrityfunds.com.

SHAREHOLDER INQUIRIES AND MAILINGS

All inquiries regarding the Fund should be directed to:

Integrity Funds Distributor, Inc.
1 Main Street North
Minot, ND 58703
Phone: 800-276-1262

All inquiries regarding account information should be directed to:

Integrity Fund Services, Inc.
P.O. Box 759
Minot, ND 58702
Phone: 800-601-5593

To reduce expenses, the Fund may only mail one copy of its prospectus and each annual and semi-annual report to those addresses shared by two or more accounts. If you wish to receive individual copies of these documents, please call Integrity Funds Distributor, Inc. ("Integrity Funds Distributor") at 800-276-1262 (or contact your financial institution). Individual copies will be sent thirty days after receiving your request.

Terms & Definitions July 31, 2008 (Unaudited)

Appreciation

Increase in the value of an asset

Average Annual Total Return

A standardized measurement of the return (yield and appreciation) earned by a fund on an annual basis assuming all distributions are reinvested

Coupon Rate or Face Rate

Rate of interest payable annually based on the face amount of the bond; expressed as a percentage

Depreciation

Decrease in the value of an asset

Lehman Brothers Municipal Bond Index

An unmanaged list of long-term, fixed-rate, investment-grade, tax-exempt bonds representative of the municipal bond market; the index does not take into account brokerage commissions or other costs, may include bonds different from those in the Fund, and may pose different risks than the Fund

Market Value

Actual (or estimated) price at which a bond trades in the marketplace

Maturity

A measure of the term or life of a bond in years; when a bond "matures", the issuer repays the principal

Net Asset Value

The value of all of a fund's assets, minus any liabilities, divided by the number of outstanding shares, not including any initial sales charge

Quality Ratings

A designation assigned by independent rating companies to give a relative indication of a bond's creditworthiness; "AAA," "AA," "A," and "BBB" indicate investment grade securities. Ratings can range from a high of "AAA" to a low of "D".

Total Return

Measures both the net investment income and any realized and unrealized appreciation or depreciation of the underlying investments in a fund's portfolio for the period, assuming the reinvestment of all dividends; represents the aggregate percentage or dollar value change over the period

July 31, 2008 (Unaudited)

COMPOSITION

Portfolio Quality Ratings
(Based on total long-term investments)

AAA	18.7%
AA	55.8%
A	14.5%
BBB	5.5%
NR	5.5%

Quality ratings reflect the financial strength of the issuer. They are assigned by independent ratings services such as Moody's Investors Services ("Moody's") and Standard & Poor's Ratings Group ("S&P"). Non-rated bonds have been determined to be of appropriate quality for the portfolio by Integrity Money Management, Inc. ("Integrity Money Management"), the Fund's investment adviser.

These percentages are subject to change.

Portfolio Market Sectors
(As a percentage of Net Assets)

S—School	30.0%
U—Utilities	21.6%
T—Transportation	18.3%
O—Other	12.4%
H—Housing	5.4%
W/S—Water/Sewer	5.3%
HC—Health Care	3.8%
G—Government	3.2%

Market sectors are breakdowns of the Fund's portfolio holdings into specific investment classes.

These percentages are subject to change.

July 31, 2008 (Unaudited)

DISCLOSURE OF FUND EXPENSES

The example below is intended to describe the fees and expenses borne by shareholders and the impact of those costs on your investment.

EXAMPLE

As a shareholder of the Fund, you incur two types of costs:

•	transaction costs:	sales charges (loads), redemption fees, and exchange fees
•	ongoing costs:	management fees, distribution (12b-1) fees, and other Fund expenses

This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period from January 31, 2008 to July 31, 2008.

The example illustrates the Fund's costs in two ways:

Actual expenses

The section in the table under the heading "Actual" provides information about actual account values and actual expenses. You may use the information in these columns together with the amount you invested to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an account value of $8,600 divided by $1,000 equals 8.6), then multiply the result by the number in the column entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period.

Hypothetical example for comparison purposes

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

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees, or exchange fees. Therefore, the section in the table under the heading "Hypothetical (5% return before expenses)" is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

	Beginning Account Value 01/31/08	Ending Account Value 07/31/08		Expenses Paid During Period*
Actual	$1,000.00	$	975.84	$5.29
Hypothetical (5% return before expenses)	$1,000.00	$	1,019.51	$5.40

*Expenses are equal to the annualized expense ratio of 1.07%, multiplied by the average account value over the period, multiplied by 180/360 days. The Fund's ending account value on the first line in the table is based on its actual total return of (2.42%) for the six-month period of January 31, 2008 to July 31, 2008.

July 31, 2008 (Unaudited)

AVERAGE ANNUAL TOTAL RETURNS

		For periods ending July 31, 2008
Oklahoma Municipal Fund		1 year	3 year	5 year	10 year	Since Inception (September 25, 1996)
	Without Sales Charge	1.01%	2.82%	3.03%	3.45%	3.88%
	With Sales Charge (4.25%)	(3.29%)	1.34%	2.14%	3.00%	3.50%
Lehman Brothers Municipal Bond Index		1 year	3 year	5 year	10 year	Since Inception (September 25, 1996)
		2.84%	3.22%	4.35%	4.92%	5.51%

Putting Performance into Perspective

Performance data quoted above is historical. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. The principal value and investment return of an investment will fluctuate so that your shares, when redeemed, may be worth more or less than the original cost. You can obtain performance data current to the most recent month end (available within seven business days of the most recent month end) by calling 800-276-1262.

You should consider the Fund's investment objectives, risks, charges, and expenses carefully before investing. For this and other important information, please obtain a Fund prospectus at no cost from your financial adviser and read it carefully before investing.

The table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions and redemption of Fund shares.

July 31, 2008 (Unaudited)

COMPARATIVE INDEX GRAPH

Comparison of change in value of a $10,000 investment in the Fund and the Lehman Brothers Municipal Bond Index

	Oklahoma Municipal Fund without sales charge		Oklahoma Municipal Fund with maximum sales charge		Lehman Brothers Municipal Bond Index
7/31/98	$	10,000	$	9,574	$	10,000
1999	$	10,425	$	9,980	$	10,288
2000	$	10,412	$	9,969	$	10,732
2001	$	11,430	$	10,943	$	11,815
2002	$	12,054	$	11,540	$	12,608
2003	$	12,087	$	11,572	$	13,061
2004	$	12,531	$	11,997	$	13,816
2005	$	12,909	$	12,359	$	14,695
2006	$	13,476	$	12,901	$	15,071
2007	$	13,894	$	13,301	$	15,713
7/31/08	$	14,034	$	13,436	$	16,160

Putting Performance into Perspective

Performance data quoted above is historical. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. The principal value and investment return of an investment will fluctuate so that your shares, when redeemed, may be worth more or less than the original cost. You can obtain performance data current to the most recent month end (available within seven business days of the most recent month end) by calling 800-276-1262.

You should consider the Fund's investment objectives, risks, charges, and expenses carefully before investing. For this and other important information, please obtain a Fund prospectus at no cost from your financial adviser and read it carefully before investing.

The graph does not reflect the deduction of taxes that a shareholder would pay on Fund distributions and redemptions of Fund shares.

The graph comparing the Fund's performance to a benchmark index provides you with a general sense of how the Fund performed. To put this information in context, it may be helpful to understand the special differences between the two. The Lehman Brothers Municipal Bond Index is a national index representative of the national municipal bond market, whereas the Fund concentrates its investments in Oklahoma municipal bonds. The Fund's total return for the periods shown appears with and without sales charges and includes Fund expenses and management fees. A securities index measures the performance of a theoretical portfolio. Unlike a fund, the index is unmanaged; there are no expenses that affect the results. In addition, few investors could purchase all of the securities necessary to match the index. If they could, they would incur transaction costs and other expenses. All Fund and benchmark returns include reinvested dividends.

July 31, 2008 (Unaudited)

MANAGEMENT OF THE FUND

The Board of the Fund consists of four Trustees. These same individuals, unless otherwise noted, also serve as Directors or Trustees for all of the funds in the Integrity family of funds, the six series of Integrity Managed Portfolios, and the three series of The Integrity Funds. Three Trustees (75% of the total) have no affiliation or business connection with Integrity Money Management or any of its affiliates; these are the "Independent" Trustees. Two of the remaining three Trustees and/or Officers are "interested" by virtue of their affiliation with Integrity Money Management and/or its affiliates.

The Independent Trustees of the Fund, their term of office and length of time served, their principal occupation(s) during the past five years, the number of portfolios overseen in the Fund Complex by each Independent Trustee, and other Directorships, if any, held outside the Fund Complex, are shown below.

INDEPENDENT TRUSTEES

NAME, ADDRESS, AND AGE	POSITION(S) HELD WITH REGISTRANT	TERM AND LENGTH SERVED	NUMBER OF PORTFOLIOS OVERSEEN IN THE FUND COMPLEX(1)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS	OTHER DIRECTORSHIPS HELD OUTSIDE THE FUND COMPLEX
Jerry M. Stai 2405 11th Ave. NW Minot, ND 58703 56	Trustee	Indefinite Since January 2006	12	Faculty, Embry-Riddle University (August 2000 to September 2005); Faculty, Park University (August 2005 to December 2005); Non-Profit Specialist, Bremer Bank (since July 2005); Faculty, Minot State University (since August 2000); Director, ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., Integrity Fund of Funds, Inc., (since January 2006); Trustee, The Integrity Funds (since January 2006).	Marycrest Franciscan Development, Inc.
Orlin W. Backes 948 13th Ave. SW Minot, ND 58701 73	Trustee	Indefinite Since January 1996	12	Attorney, McGee, Hankla, Backes & Dobrovolny, P.C.; Director, South Dakota Tax-Free Fund, Inc. (April 1995 to June 2004), ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., and Integrity Fund of Funds, Inc., (since April 2005); Trustee, The Integrity Funds (since June 2003).	First Western Bank & Trust
R. James Maxson 1 N. Main St. Minot, ND 58701 60	Trustee	Indefinite Since January 1999	12	Attorney, Maxson Law Office (since November 2002); Director, South Dakota Tax-Free Fund, Inc. (January 1999 to June 2004), Integrity Fund of Funds, Inc., ND Tax-Free Fund, Inc. and Montana Tax-Free Fund, Inc. (since January 1999); and Trustee, The Integrity Funds (since June 2003).	Vincent United Methodist Foundation Minot Area Development Corporation

⁽¹⁾ The Fund Complex consists of the three incorporated funds in the Integrity family of funds, the six series of Integrity Managed Portfolios, and the three series of The Integrity Funds.

Trustees and Officers of the Fund serve until their resignation, removal, or retirement.

The Statement of Additional Information ("SAI") contains more information about the Fund's Trustees and is available without charge upon request, by calling Integrity Funds Distributor at 800-276-1262.

The Interested Trustees and Officers of the Fund, their term of office and length of time served, their principal occupation(s) during the past five years, the number of portfolios overseen in the Fund Complex by each Interested Trustee, and other Directorships, if any, held outside the Fund Complex, are shown below.

INTERESTED TRUSTEE AND OFFICER

NAME, ADDRESS, AND AGE	POSITION(S) HELD WITH REGISTRANT	TERM AND LENGTH SERVED	NUMBER OF PORTFOLIOS OVERSEEN IN THE FUND COMPLEX(1)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS	OTHER DIRECTORSHIPS HELD OUTSIDE THE FUND COMPLEX
Robert E. Walstad(2)(3) 1 N. Main St. Minot, ND 58703 63	Trustee, Chairman, Interim President	Indefinite Since January 1996	12	Director (Sept. 1987 to Feb. 2007), CEO (Sept. 2001 to Feb. 2007), Integrity Mutual Funds; Director, President, and Treasurer, (Aug. 1988 to Feb. 2007), Integrity Money Management; Director, President, and Treasurer (Aug. 1988 to Sept. 2004), ND Capital, Inc.; Director, President, and Treasurer (May 1989 to Feb. 2007), Integrity Fund Services, Inc.; Director, President, CEO, and Treasurer, (Jan. 1996 to Aug. 2003), Integrity Funds Distributor, Inc.; Director, CEO, Chairman, (Jan. 2002 to Feb. 2007) and President (Sept. 2002 to Dec. 2004), Capital Financial Services, Inc.; Director and President, (April 1994 to June 2004) South Dakota Tax-Free Fund, Inc.; President (Jan. 1996 to July 2007) and (since March 2008) Integrity Managed Portfolios, (May 2003 to July 2007) and (since March 2008) The Integrity Funds, (Jan. 1995 to July 2007) and (since March 2008) Integrity Fund of Funds, Inc., (Jan. 1989 to July 2007) and (since March 2008) ND Tax-Free Fund, Inc., (Aug. 1993 to July 2007) and (since March 2008) Montana Tax-Free Fund, Inc.; Director and Chairman Montana Tax-Free Fund, Inc. (since May 1993), Integrity Fund of Funds, Inc. (since Aug. 1994), and ND Tax Free Fund, Inc. (since Oct. 1988); Trustee, Chairman, (since January 1996) and Treasurer (January 1996 to May 2004), Integrity Managed Portfolios; Trustee and Chairman (since June 2003), The Integrity Funds.	Minot Park Board

OFFICERS

NAME, ADDRESS, AND AGE	POSITION(S) HELD WITH REGISTRANT	TERM AND LENGTH SERVED	NUMBER OF PORTFOLIOS OVERSEEN IN THE FUND COMPLEX(1)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS	OTHER DIRECTORSHIPS HELD OUTSIDE THE FUND COMPLEX
Peter A. Quist 1 N. Main St. Minot, ND 58703 74	Vice President, Secretary	Indefinite Since January 1996	3	Attorney; Director and Vice President, Integrity Mutual Funds; Director, Vice President, and Secretary, Integrity Money Management, ND Capital, Inc. (August 1988 to August 2006), Integrity Fund Services, Inc., and Integrity Funds Distributor; Director, Vice President, and Secretary, South Dakota Tax-Free Fund, Inc. (April 1994 to June 2004), Montana Tax-Free Fund, Inc. (since May 1993), Integrity Fund of Funds, Inc. (since Aug. 1994), and ND Tax Free Fund, Inc. (since Oct. 1988); Vice President and Secretary, The Integrity Funds (since June 2003).	None
Adam C. Forthun 1 N. Main St. Minot, ND 32	Treasurer	Indefinite Since May 2008	N/A	Fund Accountant (May 2003 to October 2005), Fund Accounting Supervisor (October 2005 to March 2008), Fund Accounting Manager (since March 2008), Integrity Fund Services, Inc.; Treasurer (since May 2008), Integrity Managed Portfolios, The Integrity Funds, ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., and Integrity Fund of Funds, Inc.	None
Brent M. Wheeler 1 N. Main St. Minot, ND 58703 37	Mutual Fund Chief Compliance Officer	Indefinite Since October 2005	N/A	Fund Accounting Manager (May 1998 to October 2005), Integrity Fund Services, Inc.; Treasurer (May 2004 to October 2005), Mutual Fund Compliance Officer (since October 2005), Integrity Managed Portfolios, The Integrity Funds, ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., and Integrity Fund of Funds, Inc.	None

⁽¹⁾ The Fund Complex consists of the three incorporated funds in the Integrity family of funds, the six series of Integrity Managed Portfolios, and the three series of The Integrity Funds.

⁽²⁾ Trustees and/or Officers who are "interested persons" of the Fund as defined in the Investment Company Act of 1940, as amended (the "1940 Act"). Mr. Quist is an interested person by virtue of being an Officer and Director of the Fund's investment adviser and principal underwriter. Mr. Walstad is an interested person by virtue of being an Officer of the Fund and a shareholder of Integrity Mutual Funds.

⁽³⁾ Effective February 29, 2008, Mark R. Anderson resigned as President of the Fund, and effective March 4, 2008, Mr. Walstad succeeded Mr. Anderson as Interim President of the Fund. Mr. Walstad is also a Trustee and Chairman of the Fund.

Trustees and Officers of the Fund serve until their resignation, removal, or retirement.

The SAI contains more information about the Fund's Trustees and is available without charge upon request, by calling Integrity Funds Distributor at 800-276-1262.

Schedule of Investments July 31, 2008

Name of Issuer
Percentages represent the market value of each investment category to total net assets	Rating (Unaudited) Moody's/S&P		Coupon Rate	Maturity		Principal Amount		Market Value
OKLAHOMA MUNICIPAL BONDS (96.5%)
Alva, OK Hosp. Auth. (Sales Tax Rev) Radian (Xcel)	A-3/A		5.250%	06/01/2025	$	250,000	$	253,705
Claremore, OK Student Hsg. Rev. (Rogers University) ACA	NR/NR		5.750	09/01/2034		500,000		445,660
Drumright, OK Utility Sys. Rev. Assured Guaranty Ins.	NR/AAA		4.750	02/01/2036		950,000		966,805
Durant, OK Community Fac. Auth. Sales Tax Rev. XLCA	NR/A		5.500	11/01/2019		500,000		532,745
Edmond Economic Dev. Auth., OK Student Housing Rev.	Baa-3/NR		5.375	12/01/2019		200,000		195,422
#Edmond Economic Dev. Auth., OK Student Housing Rev.	Baa-3/NR		5.500	12/01/2028		865,000		799,545
Edmond Public Works Auth. AMBAC	Aa-3/AA		4.850	01/01/2024		155,000		157,688
Edmond Public Works Auth. AMBAC	Aa-3/AA		4.750	07/01/2024		250,000		247,645
Edmond Public Works Sales Tax & Utility Rev. AMBAC	Aa-3/AA		4.750	07/01/2023		200,000		201,080
Garfield Cty., Criminal Justice Auth. (Enid, OK) Rev. MBIA	A/NR		4.500	04/01/2018		250,000		253,877
Glenpool Utility Authority XLCA	NR/BBB-		5.000	10/01/2027		555,000		555,228
Jackson Cty., OK Sales Tax Rev. AMBAC	Aa-3/AA		5.000	10/01/2022		500,000		511,185
Jenks Aquarium Auth. Rev. MBIA	A/AA		5.250	07/01/2029		500,000		510,920
Mannford Public Works Auth.	NR/BBB+		6.000	04/01/2027		300,000		315,402
Mannford Public Works Auth.	NR/BBB+		5.900	04/01/2032		250,000		259,355
McAlester, OK Public Works Auth. FSA	Aaa/NR		5.100	02/01/2030		100,000		102,210
McClain Cty., OK Econ. Dev. Auth. Ed. Lease Rev. (Purcell Schools) Assured GTY	Aaa/AAA		4.250	09/01/2020		585,000		576,851
Midwest City, OK Capital Impvt. MBIA	A/AA		5.375	09/01/2024		500,000		519,805
Norman, OK (Regl. Hospital) Auth. Radian	A-3/A		5.250	09/01/2016		180,000		187,490
Norman, OK Utilities Auth. Utility Rev. FGIC	A/NR		4.000	11/01/2022		265,000		242,894
OK Agric. & Mech. Colleges (OK St. Univ.) Athletic Facs. AMBAC	Aa-3/NR		5.000	08/01/2024		300,000		300,000
Oklahoma City, OK MBIA	Aa-1/AA+		4.250	03/01/2022		110,000		105,976
Oklahoma City Airport Trust Jr. Lien Refunding Series B. AMBAC	Aa-3/AA		5.000	07/01/2019		250,000		264,207
Oklahoma City Airport Trust Jr. Lien Refunding Series B AMBAC	Aa-3/AA		5.000	07/01/2021		250,000		259,440
Oklahoma City, OK Public Auth. (OKC Fairgrounds Fac.) FGIC	A/A		5.500	10/01/2019		250,000		268,127
Oklahoma City, OK Water Utility Trust (Water & Sewer) Rev. FGIC	Aa/AA+		5.000	07/01/2029		425,000		427,448
Oklahoma City, OK Water Utility Rev. FGIC	Aa/AA+		5.000	07/01/2034		250,000		249,297
OK Colleges Board of Regents (NE State Univ. Ctr.) Rev. FSA	Aaa/AAA		5.100	03/01/2016		140,000		140,032
OK Colleges Board of Regents (NE State Univ. Ctr.) Rev. FSA	Aaa/AAA		5.150	03/01/2021		100,000		100,032
OK Board of Regents (Univ. of Central OK) AMBAC	Aa-3/AA		5.600	08/01/2020		150,000		159,433
OK Board of Regents (Univ. of Central OK) AMBAC	Aa-3/AA		5.700	08/01/2025		390,000		407,827
OK Devl. Finance Auth. (DHS Lease Rev.) Series 2000A MBIA	A/NR		5.600	03/01/2015		280,000		284,267
OK Devl. Finance Auth. (Lease Rev.) Law Enforcement MBIA	A/AA		5.100	06/01/2027		120,000		121,987
OK Devl. Finance Auth. (OK State Syst. Higher Ed.) AMBAC	Aa-3/AA		4.900	12/01/2022		200,000		204,526
OK Devl. Finance Auth. OK Dept. of Corrections (McLoud Fac.) FGIC	NR/AA-		4.600	04/01/2022		250,000		249,982
OK Devl. Finance Auth. OK Dept. of Corrections (McLoud Fac.) FGIC	NR/AA-		4.650	04/01/2023		250,000		250,190
OK Devl. Finance Auth. OK State Higher Ed (Master Lease) FSA	Aaa/AAA		4.500	06/01/2026		250,000		245,172
OK Housing Finance Agency Single Family Homeownership		Aaa/NR	5.250	09/01/2021		90,000		89,520
*OK Housing Finance Agency Single Family Homeownership GNMA		Aaa/NR	5.375	03/01/2020		70,000		71,039
OK Housing Finance Agency Single Family Homeownership GNMA/FNMA		Aaa/NR	5.850	09/01/2020		30,000		30,354
Oklahoma Housing Finance GNMA/FNMA	Aaa/NR		5.050	09/01/2023		1,000,000		964,900
Oklahoma Housing Finance FNMA/GNMA	Aaa/NR		5.150	09/01/2029		500,000		463,295
Oklahoma Housing Finance GNMA/FNMA	Aaa/NR		5.200	09/01/2032		500,000		461,565
Oklahoma Housing Fin. Agy. Single Family Mtg. Rev	Aaa/NR		5.100	03/01/2017		100,000		99,525
Oklahoma Housing Fin. Agy. Single Family Mtg. Rev.	Aaa/NR		5.100	09/01/2017		100,000		99,450
OK Devl. Finance Auth. (St. John Health Syst.) Rev. Ref.—Unrefunded	A-1/AA-		5.750	02/15/2025		125,000		127,955
OK Devl. Finance Auth. (St. John Health Syst.) Rev. Ref.—Unrefunded	A-1/AA-		6.000	02/15/2029		100,000		102,641
OK Devl. Finance Auth. (St. John Health Syst.) MBIA	A-1/AA		5.750	02/15/2025		50,000		51,191
OK Devl. Finance Auth. (St. Ann's Retirement Village) Rev. MBIA	A/NR		5.000	12/01/2028		500,000		506,300
OK Devl. Finance Auth. (Comanche County Hosp.)	NR/BBB-		5.625	07/01/2009		105,000		107,596
OK Devl. Finance Auth. (Seminole State College)	NR/AA		5.125	12/01/2027		150,000		154,364
OK Devl. Finance Auth. (Langston Univ. Stadium)	NR/AA		5.000	07/01/2027		250,000		258,215
#OK State G.O. (OK Building Commission) FGIC	Aa-3/AA		5.000	07/15/2018		900,000		951,426
OK Capital Impvt. Auth. (State Highway) Rev. MBIA	A/AA		5.000	06/01/2014		250,000		269,978
OK Capital Impvt. Auth. (Higher Ed. Project) Rev. AMBAC	Aa-3/AA		5.000	07/01/2022		500,000		518,455
OK Capital Impvt. Auth. (Higher Ed. Project) AMBAC	Aa-3/AA		5.000	07/01/2024		250,000		258,323
*OK Capital Impvt. Auth. (Higher Ed. Project) Rev. AMBAC	Aa-3/AA		5.000	07/01/2030		2,000,000		2,012,000
OK Capital Impvt. Auth. (Supreme Court Proj.) CIFG	A-1/AA-		4.500	07/01/2026		500,000		473,160
OK Capital Impvt. Auth. (OK St. Bureau of Investigation) FSA	Aaa/AAA		4.375	07/01/2022		100,000		99,377
OK Capital Impvt. Auth. (OK St. Bureau of Investigation) FSA	Aaa/AAA		4.375	07/01/2023		100,000		98,915
OK Capital Impvt. Auth. (OK St. Bureau of Investigation) FSA	Aaa/AAA		4.500	07/01/2024		200,000		199,426
OK Municipal Power Auth. Rev. MBIA	A/AA		5.750	01/01/2024		2,230,000		2,480,719
OK Municipal Power Auth. Power Supply Rev. FGIC	A/A		4.250	01/01/2037		500,000		417,290
*OK Municipal Power Auth. Power Supply Rev. FGIC	A/A		4.500	01/01/2047		1,350,000		1,150,160
OK State Student Loan Auth.	A/NR		6.350	09/01/2025		280,000		283,945
*OK State Student Loan Auth.	Aaa/AAA		5.625	06/01/2031		685,000		685,007
OK State Student Loan Auth. MBIA	A/AA		5.300	12/01/2032		450,000		423,981
OK Water Resources Board Rev. AMBAC	Aaa/AAA		4.750	04/01/2024		100,000		102,105
OK State Water (Loan Program) Rev.	NR/AAA		5.400	09/01/2015		105,000		105,547
*OK State Water (Loan Program) Rev.	NR/AAA		5.100	09/01/2016		415,000		421,320
OK State Water Resources Board Rev.	NR/AAA		5.050	10/01/2022		200,000		210,812
OK State Water Resources Loan Rev.	NR/AAA		5.100	10/01/2027		500,000		517,460
OK State Water Resources Board Rev.	NR/AAA		4.625	10/01/2018		435,000		454,501
OK Transportation Auth. Turnpike Sys. Rev.—Prerefunded AMBAC	Aa-3/AA		5.000	01/01/2021		10,000		10,691
OK Transportation Auth. Turnpike Sys. Rev.—Unrefunded AMBAC	Aa-3/AA		5.000	01/01/2021		90,000		93,059
#Okmulgee Public Works Auth. Capital Improvement Rev. MBIA	A/AA		5.125	08/01/2030		750,000		760,725
Okmulgee Public Works Auth. Capital Improvement Rev. MBIA	A/AA		4.800	10/01/2027		500,000		510,350
Rural Enterprises, OK Inc. OK Govt. Fin. (Cleveland Cty. Hlth.) MBIA	A/NR		5.000	11/01/2021		250,000		257,378
Rural Enterprises, OK Inc. Okmulgee Student Housing Proj. Series A ACA	NR/NR		5.625	12/01/2020		140,000		134,044
Rural Enterprises, OK Inc. Okmulgee Student Housing Proj. Series A ACA	NR/NR		5.700	12/01/2025		220,000		201,265
Rural Enterprises, OK Inc. Okmulgee Student Housing Proj. ACA	NR/NR		5.750	12/01/2030		250,000		222,220
Rural Enterprises, OK Inc. Student Hsg. (Connors College) ACA	NR/NR		5.550	11/01/2021		250,000		233,398
Rural Enterprises, OK Inc. Student Hsg. (Connors College) ACA	NR/NR		5.650	11/01/2031		375,000		330,683
Rural Enterprises, OK Inc. USAOF Student Housing ACA	NR/NR		5.550	11/01/2021		250,000		231,493
Rural Enterprises, OK Inc. USAOF Student Housing ACA	NR/NR		5.650	11/01/2031		250,000		219,123
Sapulpa Municipal Authority Utility Rev. FSA	Aaa/AAA		5.125	01/01/2032		250,000		255,645
Texas Cty., OK Dev. Auth. (OPSU Student Hsg.) ACA	NR/NR		5.250	11/01/2023		250,000		221,290
Tulsa Cty, OK Indl. Auth. Recreation Facs.	NR/AA-		4.700	09/01/2024		500,000		500,105
Tulsa, OK General Obligation	Aa/AA		4.500	03/01/2023		700,000		709,324
Tulsa, OK General Obligation	Aa/AA		4.500	03/01/2026		1,035,000		1,036,035
Tulsa, Oklahoma Unlimited GO MBIA	Aa/AA		4.250	03/01/2024		500,000		479,850
City of Tulsa, OK MBIA	Aa/AA		4.250	03/01/2025		1,000,000		968,110
Tulsa Metropolitan Util. Auth. Utility Revs XLCA	Aa/AA		4.250	05/01/2026		650,000		594,815
Tulsa Metropolitan Util. Auth. Utility Revs XLCA	Aa/AA		4.500	05/01/2027		910,000		861,597
Tulsa Oklahoma Public Facs. Auth. XLCA	Aa-3/NR		5.250	11/15/2036		1,000,000		1,007,010
Tulsa Oklahoma Pub. Facs. Auth. XLCA	Aa-3/NR		4.750	11/15/2037		500,000		467,740
University of OK Board of Regents (Research Fac.) Rev. AMBAC	Aa-3/NR		4.800	03/01/2028		670,000		670,268
University of OK Board of Regents (Multi Facs.) Rev. MBIA	A-1/NR		4.750	06/01/2029		250,000		241,530
OK Board of Regents (Univ. of OK) FGIC	NR/AA-		4.125	07/01/2026		500,000		462,270
University of OK Board of Regents Student Hsg. Rev. FGIC	A-1/NR		5.000	11/01/2027		1,000,000		1,006,760
University of OK Student Hsg. (Cameron Univ.) Rev. AMBAC	Aa-3/AA		5.500	07/01/2023		250,000		266,523
TOTAL OKLAHOMA MUNICIPAL BONDS (COST: $41,349,990)							$	40,548,573
SHORT-TERM SECURITIES (0.7%)						Shares
Wells Fargo Advantage National Tax-Free Money Market (COST: $308,094)						308,094	$	308,094
TOTAL INVESTMENTS IN SECURITIES (COST: $41,658,084)							$	40,856,667
OTHER ASSETS LESS LIABILITIES								1,168,956
NET ASSETS							$	42,025,623

*Indicates bonds are segregated by the custodian to cover when-issued or delayed-delivery purchases.

#Indicates bonds are segregated by the custodian to cover initial margin requirements.

Footnote: Non-rated (NR) securities have been determined to be of investment grade quality by the Fund's Manager.

Various inputs are used in determining the value of the Fund's investments. These inputs are summarized in three broad levels:

Level 1—	quoted prices in active markets for identical securities
Level 2—	other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risks, etc.)
Level 3—	significant unobservable inputs (including the Fund's own assumptions in determining the fair value of investments)

The following is a summary of the inputs used to value the Fund's investments as of July 31, 2008:

Valuation Inputs	Investments in Securities
Level 1—Quoted Prices	$	308,094
Level 2—Other Significant Observable Inputs		40,548,573
Level 3—Significant Unobservable Inputs		—
Total	$	40,856,667

The accompanying notes are an integral part of these financial statements.

Financial Statements July 31, 2008

Statement of Assets and Liabilities

July 31, 2008

ASSETS
	Investments in securities, at value (cost: $41,658,084)		$	40,856,667
	Accrued interest receivable			515,560
	Accrued dividends receivable			468
	Security sales receivable			1,062,880
	Receivable from manager			4,472
	Prepaid expenses			2,506
		Total Assets	$	42,442,553
LIABILITIES
	Disbursements in excess of demand deposit cash		$	60,909
	Dividends payable			131,062
	Payable for fund shares redeemed			170,115
	Accrued expenses			30,562
	Payable to affiliates			24,282
		Total Liabilities	$	416,930
NET ASSETS			$	42,025,623
Net assets are represented by:
	Paid-in capital		$	45,091,556
	Accumulated undistributed net realized gain (loss) on investments and futures			(2,273,200)
	Accumulated undistributed net investment income (loss)			8,684
	Unrealized appreciation (depreciation) on investments			(801,417)
		Total amount representing net assets applicable to 3,909,928 outstanding shares of no par common stock (unlimited shares authorized)	$	42,025,623
Net asset value per share			$	10.75
Public offering price (based on sales charge of 4.25%)			$	11.23

The accompanying notes are an integral part of these financial statements.

Financial Statements July 31, 2008

Statement of Operations

For the year ended July 31, 2008

INVESTMENT INCOME
	Interest		$	2,197,052
	Dividends			50,573
		Total Investment Income	$	2,247,625
EXPENSES
	Investment advisory fees		$	242,729
	Distribution (12b-1) fees			121,365
	Administrative service fees			60,353
	Transfer agent fees			96,433
	Accounting service fees			48,141
	Custodian fees			7,515
	Professional fees			23,893
	Trustees fees			5,059
	Insurance expense			1,297
	Reports to shareholders			3,033
	Audit fees			6,772
	Legal fees			35,363
	Transfer agent out-of-pockets			716
	License, fees, and registrations			2,092
		Total Expenses	$	654,761
	Less expenses waived or absorbed by the Fund's manager			(135,321)
		Total Net Expenses	$	519,440
NET INVESTMENT INCOME (LOSS)			$	1,728,185
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
	Net realized gain (loss) from investment transactions		$	191,550
	Net change in unrealized appreciation (depreciation) of investments			(1,430,856)
		Net Realized and Unrealized Gain (Loss) on Investments	$	(1,239,306)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS			$	488,879

The accompanying notes are an integral part of these financial statements.

Financial Statements July 31, 2008

Statement of Changes in Net Assets

For the year ended July 31, 2008 and the year ended July 31, 2007

			For The Year Ended July 31, 2008		For The Year Ended July 31, 2007
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
	Net investment income (loss)		$	1,728,185	$	1,645,717
	Net realized gain (loss) on investment transactions			191,550		17,886
	Net change in unrealized appreciation (depreciation) on investments			(1,430,856)		(348,424)
		Net Increase (Decrease) in Net Assets Resulting From Operations	$	488,879	$	1,315,179
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
	Dividends from net investment income ($.39 and $.39 per share, respectively)		$	(1,723,635)	$	(1,644,054)
	Distributions from net realized gain on investment transactions ($.00 and $.00 per share, respectively)			0		0
		Total Dividends and Distributions	$	(1,723,635)	$	(1,644,054)
CAPITAL SHARE TRANSACTIONS
	Proceeds from sale of shares		$	7,697,361	$	14,210,933
	Proceeds from reinvested dividends			968,322		703,589
	Cost of shares redeemed			(13,252,678)		(10,301,303)
		Net Increase (Decrease) in Net Assets Resulting from Capital Share Transactions	$	(4,586,995)	$	4,613,219
TOTAL INCREASE (DECREASE) IN NET ASSETS			$	(5,821,751)	$	4,284,344
NET ASSETS, BEGINNING OF PERIOD				47,847,374		43,563,030
NET ASSETS, END OF PERIOD			$	42,025,623	$	47,847,374
Undistributed Net Investment Income			$	8,684	$	4,148

The accompanying notes are an integral part of these financial statements.

Notes to Financial Statements July 31, 2008

Note 1. ORGANIZATION

The Fund is an investment portfolio of Integrity Managed Portfolios (the "Trust") and is registered under the Investment Company Act of 1940, as amended (the "1940 Act") as a non-diversified, open-end management investment company. The Trust may offer multiple portfolios; currently six portfolios are offered. The Trust is an unincorporated business trust organized under Massachusetts law on August 10, 1990. The Fund had no operations from that date to September 25, 1996, other than matters relating to organization and registration. On September 25, 1996, the Fund commenced its Public Offering of capital shares.

The investment objective of the Fund is to provide its shareholders with as high a level of current income exempt from both federal and Oklahoma state income tax as is consistent with preservation of capital. The Fund will seek to achieve this objective by investing primarily in a portfolio of Oklahoma municipal securities.

Shares of the Fund are offered at net asset value plus a maximum sales charge of 4.25% of the offering price.

Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Investment security valuation—Securities for which quotations are not readily available (which will constitute a majority of the securities held by the Fund) are valued using a matrix system at fair value as determined by Integrity Money Management. The matrix system has been developed based on procedures approved by the Board of Trustees and includes consideration of the following:

• yields or prices of municipal bonds of comparable quality;

• type of issue, coupon, maturity, and rating;

• indications as to value from dealers; and

• general market conditions.

Because the market value of securities can only be established by agreement between parties in a sales transaction, and because of the uncertainty inherent in the valuation process, the fair values as determined may differ from the values that would have been used had a ready market for the securities existed. The Fund follows industry practice and records security transactions on the trade date.

The Fund concentrates its investments in a single state. This concentration may result in the Fund investing a relatively high percentage of its assets in a limited number of issuers.

When-issued securities—The Fund may purchase securities on a when-issued basis. Payment and delivery may take place after the customary settlement period for that security. The price of the underlying securities and the date when the securities will be delivered and paid for are fixed at the time the transaction is negotiated. The value of the securities purchased on a when-issued basis are identified as such in the Fund's Schedule of Investments. With respect to purchase commitments, the Fund identifies securities as segregated in its records with a value at least equal to the amount of the commitment. Losses may arise due to changes in the value of the underlying securities or if the counterparty does not perform under the contract's terms, or if the issuer does not issue the securities due to political, economic, or other factors.

Contingent Deferred Sales Charge—In the case of investments of $1 million or more, a 1.00% CDSC may be assessed on shares redeemed within 24 months of purchase (excluding shares purchased with reinvested dividends and/or distributions).

Federal and state income taxes— The Fund's policy is to comply with the requirements of the Internal Revenue Code that are applicable to regulated investment companies and to distribute all of its net investment income and any net realized gain on investments to its shareholders. Therefore, no provision for income taxes is required. Distributions during the year ended July 31, 2008 were characterized as tax-exempt for tax purposes.

In June 2006, the Financial Accounting Standards Board ("FASB") issued Interpretation No. 48, "Accounting for Uncertainty in Income Taxes" ("FIN 48"). FIN 48 establishes the minimum threshold for recognizing, and a system for measuring, the benefits of tax-return positions taken on federal income tax returns for all open tax years (tax years ended July 31, 2004 through July 31, 2008) for purposes of implementing FIN 48, and has concluded that no provision for income tax is required in the Fund's financial statements. Interest and penalties related to uncertain tax positions, if any, are classified in the Fund's financial statements as other expense.

The tax character of distributions paid was as follows:

			July 31, 2008		July 31, 2007
Tax-exempt income		$	1,723,635	$	1,644,054
Ordinary income			0		0
Long-term capital gains			0		0
	Total	$	1,723,635	$	1,644,054

As of July 31, 2008, the components of accumulated earnings/(deficit) on a tax basis were as follows:

Undistributed Ordinary Income	Undistributed Long-Term Capital Gains	Undistributed Accumulated Earnings	Accumulated Capital and Other Losses	Unrealized Appreciation/ (Depreciation)	Total Accumulated Earnings/(Deficit)
$0	$0	$0	($2,273,200)	($792,733)	($3,065,933)

The Fund has unexpired capital loss carryforwards for tax purposes as of July 31, 2008 totaling $2,273,200, which may be used to offset capital gains. Any difference between book-basis and tax-basis unrealized appreciation/(depreciation) is attributable to timing differences associated with market discount. The capital loss carryforward amounts will expire in each of the years ended July 31 as shown in the table below.

Year	Unexpired Capital Losses
2010	$165,920
2011	$412,304
2012	$547,833
2013	$1,147,143

For the year ended July 31, 2008, the Fund did not make any permanent reclassifications to reflect tax character.

Net capital losses incurred after October 31 and within the tax year are deemed to arise on the first business day of the Fund's next taxable year. For the year ended July 31, 2008, the Fund did not defer to August 1, 2008, any post-October capital losses, post-October currency losses, or post-October passive foreign investment company losses.

Distributions to shareholders—Dividends from net investment income, declared daily and paid monthly, are reinvested in additional shares of the Fund at net asset value or paid in cash. Capital gains, when available, are distributed at least annually.

Premiums and discounts—Premiums and discounts on municipal securities are amortized for financial reporting purposes.

Other—Income and expenses are recorded on the accrual basis. Investment transactions are accounted for on the trade date. Realized gains and losses are reported on the identified cost basis. Distributions to shareholders are recorded by the Fund on the ex-dividend date. Income and capital gain distributions are determined in accordance with federal income tax regulations and may differ from net investment income and realized gains determined in accordance with accounting principles generally accepted in the United States of America. These differences are primarily due to differing treatments for market discount, capital loss carryforwards, and losses due to wash sales and futures transactions.

Permanent book and tax basis differences relating to shareholder distributions will result in reclassifications to paid-in capital. Temporary book and tax basis differences will reverse in a subsequent period.

Futures contracts—The Fund may purchase and sell financial futures contracts to hedge against changes in the values of tax-exempt municipal securities the Fund owns or expects to purchase.

A futures contract is an agreement between two parties to buy or sell units of a particular index or a certain amount of U.S. government or municipal securities at a set price on a future date. Upon entering into a futures contract, the Fund is required to deposit with a broker an amount of cash or securities equal to the minimum "initial margin" requirement of the futures exchange on which the contract is traded. Subsequent payments ("variation margin") are made or received by the Fund, dependent on the fluctuations in the value of the underlying index. Daily fluctuations in value are recorded for financial reporting purposes as unrealized gains or losses by the Fund. When entering into a closing transaction, the Fund will realize, for book purposes, a gain or loss equal to the difference between the value of the futures contracts sold and the futures contracts to buy. Unrealized appreciation (depreciation) related to open futures contracts is required to be treated as realized gain (loss) for federal income tax purposes.

Securities held in collateralized accounts to cover initial margin requirements on open futures contracts are noted in the Schedule of Investments. The Statement of Assets and Liabilities reflects a receivable or payable for the daily mark to market for variation margin.

Certain risks may arise upon entering into futures contracts. These risks may include changes in the value of the futures contracts that may not directly correlate with changes in the value of the underlying securities.

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

Note 3. CAPITAL SHARE TRANSACTIONS

As of July 31, 2008, there were unlimited shares of no par authorized; 3,909,928 and 4,337,842 shares were outstanding at July 31, 2008 and July 31, 2007, respectively.

Transactions in capital shares were as follows:

	For The Year Ended July 31, 2008	For The Year Ended July 31, 2007
Shares sold	698,432	1,272,549
Shares issued on reinvestment of dividends	88,436	63,077
Shares redeemed	(1,214,782)	(930,317)
Net increase (decrease)	(427,914)	405,309

Note 4. INVESTMENT ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES

Integrity Money Management, the Fund's investment adviser; Integrity Funds Distributor, the Fund's underwriter; and Integrity Fund Services, Inc. ("Integrity Fund Services"), the Fund's transfer, accounting, and administrative services agent; are subsidiaries of Integrity Mutual Funds, the Fund's sponsor.

The Fund has engaged Integrity Money Management to provide investment advisory and management services to the Fund. The Investment Advisory Agreement provides for fees to be computed at an annual rate of 0.50% of the Fund's average daily net assets. The Fund has recognized $115,919 of investment advisory fees after partial waiver for the year ended July 31, 2008. The Fund does not have a payable to Integrity Money Management at July 31, 2008 for investment advisory fees. Certain Officers and Trustees of the Fund are also Officers and Directors of Integrity Money Management.

Under the terms of the advisory agreement, Integrity Money Management has agreed to pay all the expenses of the Fund (excluding taxes and brokerage fees and commissions, if any) that exceed 1.07% of the Fund's average daily net assets on an annual basis up to the amount of the investment advisory and management fee. Accordingly, after fee waivers and expense reimbursements, the Fund's actual total annual operating expenses were 1.07% for the year ended July 31, 2008.

Principal underwriter and shareholder services

Integrity Funds Distributor serves as the principal underwriter for the Fund. The Fund has adopted a distribution plan as allowed by Rule 12b-1 of the 1940 Act. Distribution plans permit the Fund to reimburse its principal underwriter for costs related to selling shares of the Fund and for various other services. These costs, which consist primarily of commissions and service fees to broker-dealers who sell shares of the Fund, are paid by shareholders through expenses called "Distribution Plan expenses". The Fund currently pays an annual distribution fee of up to 0.25% of the average daily net assets of the Fund. Distribution Plan expenses are calculated daily and paid monthly. The Fund has recognized $121,365 of distribution fees for the year ended July 31, 2008. The Fund has a payable to Integrity Funds Distributor of $8,875 at July 31, 2008 for distribution fees.

Integrity Fund Services, the transfer agent, provides shareholder services for a variable fee equal to 0.20% of the Fund's average daily net assets on an annual basis for the Fund's first $50 million and at a lower rate on the average daily net assets in excess of $50 million, with a minimum of $2,000 per month plus reimbursement of out-of-pocket expenses. An additional fee with a minimum of $500 per month is charged for each additional share class. The Fund has recognized $96,433 of transfer agency fees and expenses for the year ended July 31, 2008. The Fund has a payable to Integrity Fund Services of $7,100 at July 31, 2008 for transfer agency fees. Integrity Fund Services also acts as the Fund's accounting services agent for a monthly fee equal to the sum of a fixed fee of $2,000, and a variable fee equal to 0.05% of the Fund's average daily net assets on an annual basis for the Fund's first $50 million and at a lower rate on the average daily net assets in excess of $50 million. An additional fee with a minimum of $500 per month is charged for each additional share class. The Fund has recognized $48,141 of accounting service fees for the year ended July 31, 2008. The Fund has a payable to Integrity Fund Services of $3,775 at July 31, 2008 for accounting service fees. Integrity Fund Services also acts as the Fund's administrative services agent for a variable fee equal to 0.125% of the Fund's average daily net assets on an annual basis for the Fund's first $50 million and at a lower rate on the average daily net assets in excess of $50 million, with a minimum of $2,000 per month plus out-of-pocket expenses. An additional fee with a minimum of $500 per month will be charged for each additional share class. The Fund has recognized $60,353 of administrative service fees for the year ended July 31, 2008. The Fund has a payable to Integrity Fund Services of $4,438 at July 31, 2008 for administrative service fees.

Note 5. INVESTMENT SECURITY TRANSACTIONS

The cost of purchases and proceeds from the sales of investment securities (excluding short-term securities) aggregated $4,797,697 and $9,473,096, respectively, for the year ended July 31, 2008.

Note 6. INVESTMENT IN SECURITIES

At July 31, 2008, the aggregate cost of securities for federal income tax purposes was substantially the same for financial reporting purposes at $41,658,084. The net unrealized depreciation of investments based on the cost was $801,417, which is comprised of $359,425 aggregate gross unrealized appreciation and $1,160,842 aggregate gross unrealized depreciation. Differences between financial reporting-basis and tax-basis unrealized appreciation/(depreciation) are due to differing treatment of market discount.

Note 7. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In September 2006, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards (SFAS) No. 157 Fair Value Measurements. This standard defines fair value, and establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands disclosures about fair value measurements. The standard is effective for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years.

In accordance with the provisions of SFAS No. 157, the Fund adopted this standard during the current fiscal year. The implementation of the standard did not impact the amounts reported in the financial statements.

In March 2008, FASB issued SFAS No. 161 Disclosures about Derivative Instruments and Hedging Activities. This standard requires enhanced disclosures to provide information about the reasons the Fund invests in derivative instruments, the accounting treatment and the effect derivatives have on financial performance. The standard is effective for fiscal years beginning after November 15, 2008, and interim periods within those fiscal years. Management is currently evaluating the impact the adoption of SFAS No. 161 will have on the Fund's financial statement disclosures.

Financial Highlights July 31, 2008

Selected per share data and ratios for the periods indicated

				For The Year Ended July 31, 2008		For The Year Ended July 31, 2007		For The Year Ended July 31, 2006		For The Year Ended July 29, 2005		For The Year Ended July 30, 2004
NET ASSET VALUE, BEGINNING OF PERIOD			$	11.03	$	11.08	$	11.00	$	11.07	$	11.09
Income from Investment Operations:
	Net investment income (loss)		$	.39	$	.39	$	.39	$	.40	$	.42
	Net realized and unrealized gain (loss) on investment and futures transactions			(.28)		(.05)		.08		(.07)		(.02)
		Total Income (Loss) From Investment Operations	$	.11	$	.34	$	.47	$	.33	$	.40
Less Distributions:
	Dividends from net investment income		$	(.39)	$	(.39)	$	(.39)	$	(.40)	$	(.42)
	Distributions from net realized gains			.00		.00		.00		.00		.00
		Total Distributions	$	(.39)	$	(.39)	$	(.39)	$	(.40)	$	(.42)
NET ASSET VALUE, END OF PERIOD			$	10.75	$	11.03	$	11.08	$	11.00	$	11.07
Total Return				1.01%(A)		3.10%(A)		4.39%(A)		3.02%(A)		3.67%(A)
RATIOS/SUPPLEMENTAL DATA:
	Net assets, end of period (in thousands)		$	42,026	$	47,847	$	43,563	$	34,887	$	35,472
	Ratio of net expenses (after expense assumption) to average net assets			1.07%(B)		1.07%(B)		1.03%(B)		0.98%(B)		0.93%(B)
	Ratio of net investment income to average net assets			3.55%		3.50%		3.55%		3.60%		3.77%
	Portfolio turnover rate			10.37%		11.97%		4.65%		8.69%		10.70%

^(A) Excludes maximum sales charge of 4.25%.

^(B) During the periods indicated above, Integrity Money Management assumed and/or waived expenses of $135,321, $98,960, $60,854, $81,636, and $87,525, respectively. If the expenses had not been assumed and/or waived, the annualized ratio of total expenses to average net assets would have been 1.35%, 1.28%, 1.19%, 1.20%, and 1.19%, respectively.

Total return represents the rate that an investor would have earned or lost on an investment in the Fund assuming reinvestment of all dividends and distributions.

The accompanying notes are an integral part of these financial statements.

Tax Information for the Year Ended July 31, 2008 (Unaudited)

We are required to advise you within 60 days of the Fund's fiscal year regarding the federal tax status of distributions received by shareholders during such fiscal year. The distributions made during the fiscal year by the Fund were earned from the following sources:

		Dividends and Distributions Per Share
To Shareholders of Record	Payment Date		From Net Investment Income	From Net Realized Short-Term Gains	From Net Realized Long-Term Gains
August 31, 2007	August 31, 2007	$	.032603	.0	.0
September 28, 2007	September 28, 2007	$	.029739	.0	.0
October 31, 2007	October 31, 2007	$	.033890	.0	.0
November 30, 2007	November 30, 2007	$	.032427	.0	.0
December 31, 2007	December 31, 20007	$	.032557	.0	.0
January 31, 2008	January 31, 2008	$	.032313	.0	.0
February 29, 2008	February 29, 2008	$	.032229	.0	.0
March 31, 2008	March 31, 2008	$	.032967	.0	.0
April 30, 2008	April 30, 2008	$	.033120	.0	.0
May 30, 2008	May 30, 2008	$	.033012	.0	.0
June 30, 2008	June 30, 2008	$	.033050	.0	.0
July 31, 2008	July 31, 2008	$	.033339	.0	.0

Shareholders should consult their tax advisors.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Trustees of the Oklahoma Municipal Fund

We have audited the accompanying statement of assets and liabilities of the Oklahoma Municipal Fund (one of the portfolios constituting the Integrity Managed Portfolios), including the schedule of investments as of July 31, 2008, the related statement of operations for the year then ended, the statement of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended. These financial statements and financial highlights are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of July 31, 2008 by correspondence with the custodian and brokers. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Oklahoma Municipal Fund of the Integrity Managed Portfolios as of July 31, 2008, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.

BRADY, MARTZ & ASSOCIATES, P.C.

Minot, North Dakota USA

September 12, 2008

Item 2—Code of Ethics

(a)	The registrant has adopted a code of ethics that applies to the registrant's principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions (the "Code").
(b)	For purposes of this Item, the term "code of ethics" means written standards that are reasonably designed to deter wrongdoing and promote:
	(1)	Honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;
	(2)	Full, fair, accurate, timely, and understandable disclosure in reports and documents that a registrant files with, or submits to, the Commission and in other public communications made by the registrant;
	(3)	Compliance with applicable governmental laws, rules, and regulations;
	(4)	The prompt internal reporting of violations of the Code to an appropriate person or persons identified in the Code; and
	(5)	Accountability for adherence to the Code.
(c)	There were no amendments to the Code during the period covered by the Report.
(d)	The registrant did not grant any waivers, including implicit waivers, from any provisions of the Code to the PFO and PEO during the period covered by this report.
(e)	Not applicable.
(f)	See Item 12(a) regarding the filing of the Code of Ethics for the Principal Executive and Principal Financial Officers of the Integrity Managed Portfolios and Integrity Mutual Funds, Inc.

Item 3—Audit Committee Financial Expert

The Trust's Board of Trustees has determined that Jerry Stai is an audit committee financial expert, as defined in paragraph (a)(2) of Item 3 of Form N-CSR. Mr. Stai is independent for purposes of Item 3 of Form N-CSR.

Item 4—Principal Accountant Fees and Services

(a)	Audit fees include the amounts related to the professional services rendered by the principal accountant for the audit of the registrant's annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years.
		Audit Fees
		2007	$39,900
		2008	$39,900
(b)	Audit-related fees are fees principally paid for professional services rendered for due diligence and technical accounting consulting and research.
		Audit-Related Fees
		2007	$4,800
		2008	$7,200
(c)	Tax fees include amounts related to the preparation and review of the registrant's tax returns.
		Tax Fees
		2007	$7,200
		2008	$7,200
(d)	All Other Fees.
		None.
(e)	(1)	The registrant's audit committee has adopted policies and procedures that require the audit committee to pre-approve all audit and non-audit services provided to the registrant by the principal accountant.
	(2)	0% of the services described in paragraphs (b) through (d) of Item 4 were not pre-approved by the audit committee. All of the services described in paragraphs (b) through (d) of Item 4 were approved by the audit committee.
(f)	All services performed on the engagement to audit the registrant's financial statements for the most recent fiscal year end were performed by the principal accountant's full-time permanent employees.
(g)	None.
(h)	The registrant's independent auditor did not provide any non-audit services to the registrant's investment adviser or any entity controlling, controlled by, or controlled with the registrant's investment adviser that provides ongoing services to the registrant.

Item 5—Audit Committee of Listed Registrants

Not applicable

Item 6—Schedule of Investments

The Schedule of Investments 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 Company and Affiliated Purchasers

Not applicable

Item 9—Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers

Not applicable

Item 10—Submissions of Matters to a Vote of Security Holders

There have been no material changes to the procedures by which shareholders may recommend nominees to the registrant's board of directors in the last fiscal half-year.

Item 11—Controls and Procedures

(a)

Based on their evaluation of the registrant's disclosure controls and procedures as of a date within 90 days of the filing date of this Form N-CSR (the "Report"), the registrant's principal executive officer and principal financial officer believe that the disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended) are effectively designed to ensure that information required to be disclosed by the registrant in the Report is recorded, processed, summarized and reported by the filing date, including ensuring that information required to be disclosed in the Report is accumulated and communicated to the registrant's principal executive officer and principal financial officer who are making certifications in the Report, as appropriate, to allow timely decisions regarding required disclosure.

(b)

There were no changes in the registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the registrant's most recent fiscal half-year that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting.

Item 12—Exhibits

(a)	(1)	The registrant's Code of Ethics filed pursuant to Item 2 of the N-CSR is attached hereto.
	(2)	Certification pursuant to Section 30a-2(a) of the Sarbanes-Oxley Act of 2002 is filed and attached hereto.
(b)	Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 is filed and attached hereto.

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.

By:	/s/ Robert E. Walstad
	Robert E. Walstad
	Interim President, Integrity Managed Portfolios

Date: September 29, 2008

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.

By:	/s/ Adam Forthun
	Adam Forthun
	Treasurer, Integrity Managed Portfolios

Date: September 29, 2008

EX-99.CERT

CERTIFICATIONS

I, Robert E. Walstad, certify that:

1.	I have reviewed this report on Form N-CSR of Integrity Managed Portfolios;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;
4.	The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:
	(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principals;
	(c)	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation;
	(d)	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.	The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
	(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to affect the registrant's ability to record, process, summarize, and report financial information; and
	(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

By:	/s/ Robert E. Walstad
	Robert E. Walstad
	Interim President, Integrity Managed Portfolios

Date: September 29, 2008

I, Adam Forthun, certify that:

1.	I have reviewed this report on Form N-CSR of Integrity Managed Portfolios;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;
4.	The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:
	(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principals;
	(c)	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation;
	(d)	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.	The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
	(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to affect the registrant's ability to record, process, summarize, and report financial information; and
	(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

By:	/s/ Adam Forthun
	Adam Forthun
	Treasurer, Integrity Managed Portfolios

Date: September 29, 2008

EX-99.906 CERT

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

Name of Issuer: Integrity Managed Portfolios

In connection with the Report on Form N-CSR of the above-named issuer that is accompanied by this certification, the undersigned hereby certifies, to his knowledge, that:

1.	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the issuer.

By:	/s/ Robert E. Walstad
	Robert E. Walstad
	Interim President, Integrity Managed Portfolios

Date: September 29, 2008

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

Name of Issuer: Integrity Managed Portfolios

In connection with the Report on Form N-CSR of the above-named issuer that is accompanied by this certification, the undersigned hereby certifies, to his knowledge, that:

1.	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the issuer.

By:	/s/ Adam Forthun
	Adam Forthun
	Treasurer, Integrity Managed Portfolios

Date: September 29, 2008

EX-99.CODE ETH

CODE OF ETHICS FOR THE PRINCIPAL EXECUTIVE AND PRINCIPAL
FINANCIAL OFFICERS OF THE INTEGRITY FAMILY OF FUNDS

This Code of Ethics (the "Code") for Principal Executive and Principal Financial Officers has been adopted by each of the investment companies within the Integrity Mutual Funds, Inc. complex (collectively, "Funds") to effectuate compliance with Section 406 under the Sarbanes-Oxley Act of 2002 and the rules adopted to implement Section 406.

This Code applies to each Fund's principal executive officer, principal financial officer, controller or persons deemed to be performing similar critical financial and accounting functions (the "Covered Officers").

Purpose of the Code

This Code sets forth standards and procedures that are reasonably designed to promote:

• Honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;

• Full, fair, accurate, timely and understandable disclosure in reports and documents that a registrant files with, or submits to, the Securities and Exchange Commission ("SEC") and in other public communications made by the Funds;

• Compliance with applicable laws and governmental rules and regulations;

• The prompt internal reporting of violations of the Code to an appropriate person or persons identified in the Code; and

• Accountability for adherence to the Code.

In general, the principles that govern honest and ethical conduct, including the avoidance of conflicts of interest between personal and professional relationships, reflect, at the minimum: (1) the duty in performing any responsibilities as a Covered Officer, to place the interests of the Funds ahead of personal interests; (2) the fundamental standard that Covered Officers should not take inappropriate advantage of their positions; (3) the duty to assure that the Fund's financial reports to its shareholders are prepared honestly and accurately in accordance with applicable rules and regulations; and (4) the duties performed by the Covered Officer on behalf of the Funds are conducted in an honest and ethical manner.

Each Covered Officer should adhere to a high standard of business ethics and should be sensitive to situations that may give rise to actual and apparent conflicts of interest.

Ethical Handling of Actual and Apparent Conflicts of Interest

A "conflict of interest" occurs when a Covered Officer's private interest interferes with the interests of the Funds. Certain conflicts of interest arise out of the relationships between Covered Officers and the Funds and already are subject to the conflict of interest provisions in the Investment Company Act of 1940 ("Investment Company Act") and the Investment Advisers Act of 1940 ("Investment Advisers Act"). This Code does not, and is not intended to, repeat or replace existing programs and procedures, and such conflicts fall outside of the parameters of this Code.

Although typically not presenting an opportunity for improper personal benefit, conflicts arise from, or as a result of, the contractual relationship between each Fund and the investment adviser of which the Covered Officers are also officers and/or employees. As a result, this Code recognizes that the Covered Officers will, in the normal course of their duties, be involved in establishing procedures and implementing decisions that will have different effects on the adviser and the Funds. The participation of the Covered Officers in such activities is inherent in the contractual relationship between the Funds and the adviser and is consistent with the performance by the Covered Officers of their duties as officers of the Funds. If such duties are performed in conformity with the provisions of the Investment Company Act and the Investment Advisers Act, such activities will be deemed to have been handled ethically. In addition, it is recognized by the Funds' Boards of Directors/Trustees ("Boards") that the Covered Officers may also be officers or employees of one or more other investment companies covered by this or other codes.

Prohibited Activities

Other conflicts of interest are covered by the Code, even if such conflicts of interest are not subject to provisions in the Investment Company Act and the Investment Advisers Act. The following list provides examples of conflicts of interest under the Code, but keep in mind that these examples are not exhaustive. The foremost principle is that the personal interest of a Covered Officer should not be placed before the interest of the Funds or their shareholders.

Each Covered Officer must:

• Not use his personal influence or personal relationships improperly to influence investment decisions or financial reporting by the Funds whereby the Covered Officer would benefit personally to the detriment of the Funds or their shareholders;

• Not cause the Funds to take action, or fail to take action, for the individual personal benefit of the Covered Officer rather than the benefit the Funds;

• Not use material non-public knowledge of portfolio transactions made or contemplated for the Funds to trade personally or cause others to trade personally in contemplation of the market effect of such transactions;

• Not intentionally cause a Fund to fail to comply with applicable laws, rules and regulations, including failure to comply with the requirement of full, fair, accurate, understandable and timely disclosure in reports and documents that a Fund files with, or submits to, the SEC and in public communications made by the Funds;

• Not fail to acknowledge or certify compliance with this Code on an annual basis.

There are some conflict of interest situations that should always be discussed with the Compliance Department or, under certain circumstances, the Board of Directors/Trustees if material. Examples of these include:

• Service as a director on the board of any public company absent prior authorization by the Board;

• The receipt of any gifts of more than de minimis value, generally gifts in excess of $100;

• The receipt of any entertainment from any company with which the Funds have current or prospective business dealings unless such entertainment is business related, reasonable in cost, appropriate as to time and place, and not so frequent as to raise a suggestion of unethical conduct;

• Any ownership interest in, or employment relationship with, any of the Fund's service providers, other than its investment adviser, principal underwriter, administrator or any affiliated person thereof;

• A direct or indirect financial interest in commissions paid by the Funds for effecting portfolio transactions or for selling or redeeming shares other than an interest arising from the Covered Officer's employment, such as compensation or equity ownership.

Disclosure and Compliance

•	Each Covered Officer must familiarize himself with the disclosure requirements generally applicable to the Funds;
•	Each Covered Officer must not knowingly misrepresent, or cause others to misrepresent, facts about the Funds to others, including to the Fund's directors/trustees and auditors, and to governmental regulators and self-regulatory organizations;
•	Each Covered Officer should, to the extent appropriate within his area of responsibility, consult with other officers and employees of the Funds and the adviser with the goal of promoting full, fair, accurate, timely and understandable disclosure in the reports and documents the Funds file with the SEC and in other public communications made by the Funds; and
•	It is the responsibility of each Covered Officer to promote compliance with the standards and restrictions imposed by applicable laws, rules and regulations.
•

Reporting and Accountability

Each Covered Officer must:

• Upon adoption of the Code or upon becoming a Covered Officer, affirm in writing to the Board that he has received, read, understands and will adhere to this Code;

• Annually affirm to the Board that he has received and read the Code and that he understands that he is subject to, and has complied with, the requirements of the Code;

• Not retaliate against any other Covered Officer or any employee of the Funds or their affiliated persons for reports of potential violations that are made in good faith; and

• Notify Compliance, who will then notify the Fund's Audit Committee or the Fund's legal counsel promptly if he knows of any violation of this Code or if a potential violation exists. Failure to do so is itself a violation of this Code.

The Fund's Audit Committee (the "Committee") or in their discretion, the Fund's legal counsel, is responsible for applying this Code to specific situations in which questions are presented under it and has the authority to interpret this Code in any particular situation. Any approvals or waivers sought by the Principal Executive Officer will be considered by the Committee. In determining whether to waive any of the provisions of this Code, the Committee will consider whether the proposed waiver (1) is prohibited by the Code; (2) is consistent with honest and ethical conduct; and (3) will result in a conflict of interest between the Covered Officer's personal and professional obligations to the Funds.

Investigating Actual and Apparent Conflicts of Interest

The Funds will follow these procedures in investigating and enforcing the Code:

• The Committee will take all appropriate action to investigate any potential violations reported to them;

• If, after such investigation, the Committee believes that no violation has occurred, no further action is necessary;

• Any matter that the Committee believes is a violation will be reported to the Board;

• If the Board agrees that a violation has occurred, it will consider appropriate action, which may include review of, and appropriate modifications to, applicable policies and procedures; notification to appropriate personnel of the investment adviser or its board; or a recommendation to dismiss the Covered Officer;

• The Committee will be responsible for granting waivers, as appropriate; and

• Any changes to or waivers of this Code will, to the extent required, be disclosed as provided by SEC rules.

Other Policies and Procedures

This Code shall be the sole code of ethics adopted by the Funds for purposes of Section 406 of the Sarbanes-Oxley Act and the rules and forms applicable to registered investment companies thereunder. While other policies or procedures of the Funds, the Funds' adviser, principal underwriter, or other service providers govern the behavior or activities of the Covered Officers who are subject to this Code, they are superseded by this Code to the extent that they overlap or conflict with the provisions of this Code.

Amendments

At least annually, the Board of Directors/Trustees of each Fund will review the Code and determine whether any amendments are necessary or desirable. Any amendments to this Code, other than amendments to Exhibit A, must be approved or ratified by a majority vote of the Board, including a majority of independent directors.

Record Retention and Confidentiality

All reports and records prepared or maintained pursuant to this Code will be considered confidential and shall be maintained and protected accordingly to the extent permitted by applicable laws, rules and regulations. Except as otherwise required by law or this Code, such matters shall not be disclosed to anyone other than the appropriate Board and its counsel.

For Internal Use Only

The Code is intended solely for the internal use by the Funds and does not constitute an admission, by or on behalf of any Fund, as to any fact, circumstance, or legal conclusion.

_________________________________
Mark R. Anderson
President

Date: _____________________

Exhibit A

Persons covered by this Code of Ethics:

President
Treasurer