-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Igjg7sa2YVXfUdsmwTC9UC8Up8vBUIcPR/UCLA+3tnKNTnYyMN7jDTdJv1sENRG4 FwShCixmEYfHp6XcZOI/8g== 0000935069-04-001046.txt : 20040809 0000935069-04-001046.hdr.sgml : 20040809 20040809134237 ACCESSION NUMBER: 0000935069-04-001046 CONFORMED SUBMISSION TYPE: N-CSR PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 20040531 FILED AS OF DATE: 20040809 EFFECTIVENESS DATE: 20040809 FILER: COMPANY DATA: COMPANY CONFORMED NAME: STI CLASSIC FUNDS CENTRAL INDEX KEY: 0000883939 IRS NUMBER: 232678674 STATE OF INCORPORATION: MA FISCAL YEAR END: 0531 FILING VALUES: FORM TYPE: N-CSR SEC ACT: 1940 Act SEC FILE NUMBER: 811-06557 FILM NUMBER: 04960522 BUSINESS ADDRESS: STREET 1: 2 OLIVER STREET CITY: BOSTON STATE: MA ZIP: 02109 BUSINESS PHONE: 6109896602 MAIL ADDRESS: STREET 1: 530 E SWEDESFORD ROAD CITY: WAYNE STATE: PA ZIP: 19087-1693 N-CSR 1 stiinstlmmcomb_ar.txt STI CLASSIC INST. B&M COMB AR5_04 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 811-06557 STI CLASSIC FUNDS (Exact name of registrant as specified in charter) -------- 2 Oliver Street Boston, MA 02109 (Address of principal executive offices) (Zip code) Trusco Capital Management, Inc. 50 Hurt Plaza; Suite 1400 Atlanta, Georgia 30303 (Name and address of agent for service) REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: 1-800-428-6970 DATE OF FISCAL YEAR END: MAY 31, 2004 DATE OF REPORTING PERIOD: MAY 31, 2004 ITEM 1. REPORTS TO STOCKHOLDERS. ANNUAL ................................................................................. FINANCIAL REPORT ................................................................................. STI CLASSIC FUNDS ................................................................................. A Family of Mutual Funds ................................................................................. BOND FUNDS CLASSIC INSTITUTIONAL HIGH QUALITY BOND FUND CLASSIC INSTITUTIONAL SHORT-TERM BOND FUND CLASSIC INSTITUTIONAL SUPER SHORT INCOME PLUS FUND CLASSIC INSTITUTIONAL TOTAL RETURN BOND FUND CLASSIC INSTITUTIONAL U.S. GOVERNMENT SECURITIES SUPER SHORT INCOME PLUS FUND MONEY MARKET FUNDS CLASSIC INSTITUTIONAL CASH MANAGEMENT MONEY MARKET FUND CLASSIC INSTITUTIONAL U.S. GOVERNMENT SECURITIES MONEY MARKET FUND CLASSIC INSTITUTIONAL U.S. TREASURY SECURITIES MONEY MARKET FUND May 31, 2004 [GRAPHIC OMITTED] STI Classic logo Dear Valued STI Classic Funds' Shareholder: For investors, the year ending May 31, 2004 decidedly brighter and a welcome change from the post bubble weakness that began in early 2000. The economy grew at an above-average pace, helped significantly by lower interest rates and tax rebates. This in turn lifted corporate profits and equity prices, both domestic and international. However, bond yields bottomed during the year in response to the risks associated with a strengthening economy. I will expand on these developments in the following paragraphs and share Trusco Capital's outlook. Generally, after a period of vulnerability, the character of the economic expansion and the markets appear poised to shift to a more "traditional," sustained, cyclical nature, which historically has been favorable for the equity markets. Economic growth during the past year was very strong, statistically speaking. Available data showed inflation adjusted growth of nearly 5% on a year-over-year basis, matching the best periods of the record expansion of the 1990s. However, much of the growth could be traced directly to the massive and simultaneous stimulus from Federal tax cuts/rebates and low mortgage/bond yields. While this stimulus was an essential element to increased spending, the expansion was not yet self-sustaining, and so was viewed as vulnerable to setbacks. Sales growth improved as did corporate profits, but the rebound in earnings was due in large part to corporate self-help measures that were manifested in improved productivity. A resumption of job growth was seen as the litmus test to sustainability. This potential vulnerability, combined with low core inflation, kept the Federal Reserve interest rate policy accommodative during the year, with the key Fed Funds rate holding at 1%; the lowest level since 1958. The S&P 500 Index rose 18.3% on a total return basis in the year ended May 31, 2004, with the bulk of the rise concentrated in the third and fourth quarters of last year. Mid-cap and small-cap stocks were even stronger, with the S&P 400 MidCap Index posting a 26.7% gain and the Russell 2000 Small-Cap Index rising 30.3%. On the international front, the MSCI EAFE Index gained 33.2%. Cyclically sensitive sectors led the market as did those closely linked to commodities. The materials, energy, industrials, and information technology sectors each rose more than 20% during the twelve months ended May 31, 2004, while consumer discretionary and financial stocks also posted above market returns. The above average gains in the commodity price sensitive sectors helped the Value style generally outperform the Growth style for the period. A final theme that dominated market performance during the year was a sharp rebound in stocks with no earnings and/or weak financial quality. This frustrated investors investing in higher quality companies with strong balance sheets and visible earnings growth. In the fixed-income markets bond yields moved higher over the course of the twelve months, though intra-year volatility was significant. The yield on the 10-year Treasury note fell to as low as 3.11% in June 2003 and rose as high as 4.86% just before the close of the fiscal year in May. However, the steady Federal Reserve policy kept short-term rates constant causing the yield differential between long and short maturity bonds to rise to near record levels. The Lehman Aggregate Bond Index fell a modest 0.4% during the year ending May 31, 2004, though longer-term bonds such as the 10-year Treasury note were considerably weaker falling over 5%. The stronger economy helped credit-sensitive sectors such as High Yield to perform well, while Treasury securities generally underperformed. As we look ahead, the economic expansion looks both solid and sustainable, and is capable of supporting further gains in corporate profits and in equity prices. A key reason for this was the resumption of job growth in 2004, following an uncomfortably long drought which kept interest rate policy stimulative. However the pace of growth is likely to slow as the stimulative benefits of tax rebates and mortgage financing subside. Inflation pressures will increase from their historically low level, putting pressure on the Federal Reserve to begin raising interest rates following a protracted period of stimulus. Bond yields are likely to rise further as the Fed starts to apply monetary restraint, but the pace of rate hikes is expected to be gradual as long as inflation pressures do not escalate sharply. We remain cyclically overweight in stocks within our asset allocation mix, but recognize volatility could increase once the Fed begins raising interest rates. 1 Adherence to investment disciplines and greater price sensitivity on stocks will be much more important in the years ahead, as I have mentioned before, particularly if there is a meaningful rise in interest rates. The cornerstone of our investment philosophy is diversification and execution of the disciplined investment process by experienced investment professionals. I encourage you to read through the remainder of the report, as it contains comments from our fund managers on specific investment sectors and styles. Trusco has excellent fund managers and I am sure you will find their insights valuable. In closing, I want to take this opportunity to thank you for investing in the STI Classic Funds. We value the relationship we have with you and look forward to expanding it in the coming year through continued investment excellence and a broader array of investment alternatives. Sincerely, /s/Douglas S. Philips Douglas S. Phillips, CFA Chief Investment Officer 2 CLASSIC INSTITUTIONAL HIGH QUALITY BOND FUND -------------------------------------------- The investment goal of the Classic Institutional High Quality Bond Fund is to maximize yield and stability consistent with an intermediate bond portfolio invested in U.S. dollar debt securities of domestic and foreign issuers. The average dollar weighted credit rating of the portfolio should be "A" or higher. The Institutional Shares started in September 2003 and the T Shares opened in November of that same year. Bond yields remained at very low levels during most of the fiscal year ended May 31, 2004. The primary factors that kept yields low and monetary policy accommodative during 2003 and early 2004 were the war with Iraq, terrorism fears, lingering deflation concerns, and lack of improvement in labor markets and manufacturing. The Federal Reserve made only one policy rate change during the Fund's fiscal year. That move occurred in June, 2003 when the Fed lowered the Fed Funds rate to 1.00% from 1.25%. The bond market can be broken down into three distinct periods. At the beginning of the year, bond yields were rising steadily from historic lows as the Fed was backpedaling from deflationary comments that had brought yields to unrealistically low levels. In the middle of the year, yields remained low and were relatively range bound as there was no clear cut direction for the economy as investors waited patiently for good economic news. By the end of the Fund's fiscal year, while Iraq and terrorism fears remained, most of the issues that held yields in check had reversed course: economic growth was strong, labor markets were improving rapidly, manufacturing was gaining momentum, and inflation concerns had resurfaced. As a result, bond yields rose rapidly late in the Fund's fiscal year and market participants were anticipating the Federal Reserve would initiate a series of tightening moves. The Institutional Shares commenced on October 27, 2003, with the T shares opening November 13, 2003. By the end of October, 2003, the market value was under $9 million. The Fund value by the end of the fiscal year May 31, 2004, exceeded $126 million. This tremendous growth, while good, also presented investment challenges such as locating attractively priced corporate bonds in which to invest. As additional participants joined the Fund, the cash was initially earmarked for government securities in an effort to maintain the overall integrity of the Fund's duration relative to its benchmark. This hurt performance in the fourth quarter of 2003, as corporate securities outperformed government securities. In the five months ending May 31, 2004, corporates have underperformed governments as the Fund has held a slight underweight in corporates. On a positive note, the Fund has a 15% weighting in mortgage securities which has had tremendous out performance year to date 2004. The Fund has an underweight in the 1-10 year part of the curve offset by an overweight in the 0-1 year and 10 year and longer part of the curve. On an absolute basis, the longer securities underperformed in the rising rate environment, but on an absolute basis, this enabled the manager to underweight the belly of the curve and as the yield curve flattened this enhanced overall performance. Although corporate credits have stabilized from the tumultuous period of 2000 and 2001, there continues to be sporadic credit problems affecting the market. The Fund, being a high quality Fund, has been able to avoid any credit issues since its inception. The Fund is well diversified today relative to its benchmark index, the Lehman Intermediate Government/Credit A+ Index. The overall credit quality of the portfolio is AAA. /s/Robert W. Corner /s/H. Rick Nelson Robert W. Corner H. Rick Nelson Managing Director Managing Director 3 INSTITUTIONAL SHARES(1) AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2004) - ---------- Cumulative Inception to Date - ---------- -0.37% - ---------- [GRAPHIC OMITTED] EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $1,000,000 INVESTMENT STI Classic Institutional High Quality Bond Fund, Institutional Lehman Intermediate Shares Government/Credit A+ Index 10/31/03 1,000,000 1,000,000 5/04 998,245 1,004,298 T SHARES(2) AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2004) - ---------- Cumulative Inception to Date - ---------- -0.44% - ---------- [GRAPHIC OMITTED] EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT STI Classic Institutional High Quality Bond Fund, Lehman Intermediate T Shares Government/Credit A+ Index 10/31/03 $10,000 $10,000 5/04 9,975 $10,043 Past performance is no indication of future performance. The Funds' comparative benchmark does not include the annual operating expenses incurred by the Fund. (1) Institutional Shares were offered beginning on October 27, 2003. (2) T Shares were offered beginning on November 13, 2003. T Shares' performance for the period prior to November 13, 2003 reflects the performance of the Fund's Institutional Shares. The performance of the Institutional Shares has not been adjusted to reflect the higher operating expenses of the T Shares. If it had, performance would have been lower than that shown. The cumulative total return of the T Shares from its inception date of November 13, 2003 to May 31, 2004 was -0.52%. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. 4 CLASSIC INSTITUTIONAL SHORT-TERM BOND FUND ------------------------------------------ The investment goal of the Classic Institutional Short-Term Bond Fund is to maximize income while preserving principal value. The Fund focuses on investing in short duration investment grade fixed income and money market securities with the objective of generating a higher yield and better return potential than money market funds, while not assuming the greater market risk of longer-term bond funds. Money market yields and short-term bond yields remained at very low levels during most of the fiscal year ended May 31, 2004. The primary factors that kept yields low and monetary policy accommodative during 2003 and early 2004 were the war with Iraq, terrorism fears, lingering deflation concerns, and lack of improvement in labor markets and manufacturing. The Federal Reserve made only one policy rate change during the Fund's fiscal year. That move occurred in June, 2003 when the Fed lowered the Fed Funds rate to 1.00% from 1.25%. The Fund's fiscal year can be broken down into three distinct periods. At the beginning of the year, short-term bond yields were rising steadily from historic lows as the Fed was backpedaling from deflationary comments that had brought yields to unrealistically low levels. In the middle of the year, yields remained low and were relatively range bound as there was no clear cut direction for the economy as investors waited patiently for good economic news. By the end of the Fund's fiscal year, while Iraq and terrorism fears remained, most of the issues that held yields in check had reversed course: economic growth was strong, labor markets were improving rapidly, manufacturing was gaining momentum, and inflation concerns had resurfaced. As a result, short-term bond yields rose rapidly late in the Fund's fiscal year and market participants were anticipating the Federal Reserve would initiate a series of tightening moves. Some of the positive actions that helped performance of the Fund over the last year was shortening the duration range and increasing the allocation to floating rate and adjustable rate securities to. The most significant sector change was an increase to asset backed securities and mortgage backed securities. The Fund maintained its overweight in corporate bonds for the fiscal year ending May, 2004, which elevated the overall return of the portfolio. The largest overweight was in the finance sector which performed well relative to the corporate sector as a whole. There were no significant credit problems in the portfolio during the fiscal year ending May, 2004. Intelstat was purchased in the Fund at the beginning of May, 2004, and over the last two weeks some negative developments have occurred which resulted in our reevaluating the investment. The bond has underperformed over the holding period; our holding however, is less than one half of one percent of the total Fund. The best performing sector in the Fund was the automotive sector with holdings of GMAC, Ford Motor Credit and DaimlerChrysler. The overweight in corporates was offset by a large underweight in U.S. Treasury Securities. As noted, Treasuries underperformed corporates during the fiscal year. The Fund had an underweight in the 1-3 year part of the curve offset by an overweight in the 0-1 year and 3-5 year part of the curve. On an absolute basis, the longer securities underperformed in the rising rate environment, but on an absolute basis this enabled the manager to underweight the 1-3 year part of the curve and as the yield curve flattened this enhanced the overall performance. Over the past year, the dividend yield of the Fund has been consistently higher than that of money market funds. The NAV has fluctuated in a relatively narrow range, ending the year down -2.14% from the same period a year ago. The total return for the one year time period ending May 31, 2004 was a positive 0.48%. /s/Robert W. Corner /s/H. Rick Nelson Robert W. Corner H. Rick Nelson Managing Director Managing Director 5 INSTITUTIONAL SHARES(1) AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2004) - --------------------------------------------- Annualized Cumulative Inception Inception One Year to Date to Date - --------------------------------------------- 0.48% 3.38% 7.04% - --------------------------------------------- [GRAPHIC OMITTED] EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $1,000,000 INVESTMENT STI Classic Institutional Citigroup 1-3 Year Short-Term Bond Fund, Treasury/Government Insitutional Shares /Credit Index 5/31/02 $1,000,000 $1,000,000 5/03 1,060,800 1,064,900 5/04 1,065,892 1,076,614 Past performance is no indication of future performance. The Funds' comparative benchmark does not include the annual operating expenses incurred by the Fund. (1) Institutional Shares were offered beginning on May 14, 2002. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. 6 CLASSIC INSTITUTIONAL SUPER SHORT INCOME PLUS FUND -------------------------------------------------- The investment goal of the Classic Institutional Super Short Income Plus Fund is to generate high current income consistent with preserving capital and maintaining liquidity. Opened in April of 2002, the Fund focuses on investing in short duration investment grade fixed income and money market securities with the objective of generating a higher yield and better return potential than money market funds, while not assuming the greater market risk of longer-term bond funds. Money market yields and short-term bond yields remained at very low levels during most of the fiscal year ended May 31, 2004. The primary factors that kept yields low and monetary policy accommodative during 2003 and early 2004 were the war with Iraq, terrorism fears, lingering deflation concerns, and lack of improvement in labor markets and manufacturing. The Federal Reserve made only one policy rate change during the Fund's fiscal year. That move occurred in June, 2003 when the Fed lowered the Federal Funds rate to 1.00% from 1.25%. The Fund's fiscal year can be broken down into three distinct periods. At the beginning of the year, short-term bond yields were rising steadily from historic lows as the Fed was backpedaling from deflationary comments that had brought yields to unrealistically low levels. In the middle of the year, yields remained low and were relatively range bound as there was no clear cut direction for the economy as investors waited patiently for good economic news. By the end of the Fund's fiscal year, while Iraq and terrorism fears remained, most of the issues that held yields in check had reversed course: economic growth was strong, labor markets were improving rapidly, manufacturing was gaining momentum, and inflation concerns had resurfaced. As a result, short-term bond yields rose rapidly late in the Fund's fiscal year and market participants were anticipating the Federal Reserve would initiate a series of tightening moves. Over the past year, the dividend yield of the Fund has been consistently higher than that of money market funds. The NAV has fluctuated in a relatively narrow range, ending the year down slightly from the same period a year ago. During this time, the Fund shortened its duration range from 0.7-0.9 years to 0.5-0.7 years. The maximum permitted duration of the Fund is one year. The Fund performed as expected over the last year returning 1.01% (Institutional Shares) and 0.81% (T Shares). This compares to a return of 0.95% for the Lipper Ultra-Short Obligations Objective. Some of the positive actions that helped performance of the Fund over the last year was shortening the duration range to 0.5-0.7 years and increasing the allocation to floating rate and adjustable rate securities to 44%. The most significant sector change was an increase to asset-backed securities (26%) at the expense of cash and equivalent securities (13%). While holdings in mortgage-backed securities remained relatively constant at 15% of the Fund, the performance of mortgage backed securities actually detracted from overall performance as yields rose early in the fiscal year. As a result, we boosted the holdings of adjustable rate mortgages (8%) and reduced collateralized mortgage obligations (5%). The Classic Institutional Super Short Income Plus Fund has been an acceptable low risk bond fund alternative for money market investors. /s/Robert W. Corner Robert W. Corner Managing Director 7 INTITUTIONAL SHARES(1) AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2004) - ---------------------------------------------------------------- Annualized Cumulative Inception Inception One Year to Date to Date - ---------------------------------------------------------------- 1.01% 2.10% 4.51% - ---------------------------------------------------------------- [GRAPHIC OMITTED] EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $1,000,000 INVESTMENT
STI Classic Institutional Super iMoney Citigroup Short Income Plus Fund, Net First Tier 6 Month Lipper Ultra-Short Insitutional Shares Institutional Average Treasury Bill Index Obligations Objective 4/30/02 $1,000,000 $1,000,000 $1,000,000 $1,000,000 5/02 1,002,000 1,001,300 1,001,600 1,002,600 5/03 1,033,663 1,013,816 1,017,525 1,026,362 5/04 1,040,103 1,021,217 1,028,209 1,036,112
T SHARES(2) AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2004) - ---------------------------------------------------------------- Annualized Cumulative Inception Inception One Year to Date to Date - ---------------------------------------------------------------- 0.81% 1.68% 3.60% - ---------------------------------------------------------------- [GRAPHIC OMITTED] EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT
STI Classic Institutional Super iMoney Citigroup Short Income Plus Fund, Net First Tier 6 Month Lipper Ultra-Short T Shares Institutional Average Treasury Bill Index Obligations Objective 4/30/02 $10,000 $10,000 $10,000 $10,000 5/02 $10,020 $10,013 $10,016 $10,026 5/03 $10,266 $10,138 $10,175 $10,264 5/04 $10,350 $10,212 $10,282 $10,361
Past performance is no indication of future performance. The Funds' comparative benchmark does not include the annual operating expenses incurred by the Fund. (1) Institutional Shares were offered beginning on April 15, 2002. (2) T Shares were offered beginning on October 3, 2002. T Shares' performance for the period prior to October 3, 2002 reflects the performance of the Fund's Institutional Shares. The performance of the Institutional Shares has not been adjusted to reflect the higher operating expenses of the T Shares. If it had, performance would have been lower than that shown. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. 8 CLASSIC INSTITUTIONAL TOTAL RETURN BOND FUND -------------------------------------------- After getting started in October, 2003, the Fund had a good fourth quarter gathering assets, growing from about $10 million to over $40 million during the quarter. Transaction activity was devoted to investing new cash flow and adding securities to reflect our overall strategy and diversification goals. We also kept the portfolio fully invested, increasing the non-investment allocation to 10% to take advantage of the higher yield spreads in this period of improving credit fundamentals. Portfolio quality remained high with an overall rating of AA2. In the environment of falling interest rates, returns kept pace with the overall market in a strong quarter. The high yield allocation was a modest drag on results. In stark contrast to the 4th quarter of 2003, the first quarter of 2004 was very difficult for fixed income investors, as interest rates rose dramatically during the quarter, offsetting the first quarter gains. The Federal Reserve announced its intention to gradually raise interest rates, which began on June 30, 2004 with a quarter-point increase. All sectors of the credit market declined during the quarter, but the mortgage-backed and high yield exposures in the portfolio weathered the yield increases better than high grade and government sectors. Returns were negatively impacted by investments in the high yield sector, but we continue to believe these will be positive contributors as we move through an improving economic cycle. Returns lagged the Lehman U.S. Aggregate Index at - -3.0% vs. -2.4% for the quarter, after a solid first quarter. The secular bull market in bonds may be over as the Fed begins to raise rates, but we do think the moves will be gradual. Thus, we continue to hold a neutral duration as well as an overweight in mortgages and corporates to maintain a yield advantage. /s/Robert W. Corner Robert W. Corner Managing Director 9 INSTITUIONAL SHARES(1) AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2004) - ---------- Cumulative Inception to Date - ---------- 0.03% - ---------- [GRAPHIC OMITTED] EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $1,000,000 INVESTMENT STI Classic Institutional Total Return Bond Fund, Institutional Shares Lehman US Aggregate Index 10/31/03 $1,000,000 $1,000,000 5/04 997,088 1,008,411 T SHARES (2) AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2004) - ---------- Cumulative Inception to Date - ---------- -0.04% - ---------- [GRAPHIC OMITTED] EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT STI Classic Institutional Total Return Bond Fund, T Shares Lehman US Aggregate Index 10/31/03 $10,000 $10,000 5/04 9,965 10,084 Past performance is no indication of future performance. The Funds' comparative benchmark does not include the annual operating expenses incurred by the Fund. (1) Institutional Shares were offered beginning on October 15, 2003. (2) T Shares were offered beginning January 14, 2004. T Shares' performance for the period prior to January 14, 2004 reflects the performance of the Fund's Institutional Shares. The performance of the Institutional Shares has not been adjusted to reflect the higher operating expenses of the T Shares. If it had, performance would have been lower than that shown. The cumulative total return of the T Shares from its inception date of January 14, 2004 to May 31, 2004 was -2.69%. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. 10 CLASSIC INSTITUTIONAL U.S. GOVERNMENT SECURITIES SUPER SHORT INCOME PLUS FUND ----------------------------------------------------------------------------- The investment goal of the Classic Institutional U.S. Government Securities Super Short Income Plus Fund is to generate high current income consistent with preserving capital and maintaining liquidity. Opened in April of 2002, the Fund focuses on investing in short duration U.S. Government securities with the objective of generating a higher yield and better return potential than money market funds, while not assuming the greater market risk of longer-term bond funds. Money market yields and short-term bond yields remained at very low levels during most of the fiscal year ended May 31, 2004. The primary factors that kept yields low and monetary policy accommodative during 2003 and early 2004 were the war with Iraq, terrorism fears, lingering deflation concerns, and lack of improvement in labor markets and manufacturing. The Federal Reserve made only one policy rate change during the Fund's fiscal year. That move occurred in June, 2003 when the Fed lowered the Federal Funds rate to 1.00% from 1.25%. The Fund's fiscal year can be broken down into three distinct periods. At the beginning of the year, short-term bond yields were rising steadily from historic lows as the Fed was backpedaling from deflationary comments that had brought yields to unrealistically low levels. In the middle of the year, yields remained low and were relatively range bound as there was no clear-cut direction for the economy as investors waited patiently for good economic news. By the end of the Fund's fiscal year, while Iraq and terrorism fears remained, most of the issues that held yields in check had reversed course: economic growth was strong, labor markets were improving rapidly, manufacturing was gaining momentum, and inflation concerns had resurfaced. As a result, short-term bond yields rose rapidly late in the Fund's fiscal year and market participants were anticipating the Federal Reserve would initiate a series of tightening moves. Over the past year, the dividend yield of the Fund has been consistently higher than that of money market funds. The NAV has fluctuated in a relatively narrow range, ending the year down slightly from the same period a year ago. During this time, the Fund shortened its duration range from 0.7-0.9 years to 0.5-0.7 years. The maximum permitted duration of the Fund is one year. The Fund performed as expected over the last year returning 1.01% (Institutional Shares) and 0.47% (L Shares). This compares to a return of 0.95% for the Lipper Ultra-Short Obligations Objective. Some of the positive actions that helped performance of the Fund over the last year was shortening the duration range to 0.5-0.7 years and increasing the allocation to floating rate and adjustable rate securities to 43%. The most significant sector change was an increase to U.S. Government Agency notes/bonds (39%) at the expense of cash and equivalent securities (25%). In addition, for the first time, we added student loan asset-backed securities to the portfolio (8%) to help increase yield. While holdings in U.S. Government Agency mortgage-backed securities remained relatively constant between 25% and 30% of the Fund, the performance of mortgage-backed securities actually detracted from overall performance as yields rose early in the fiscal year. As a result, we boosted the holdings of adjustable rate mortgages (13%) and reduced collateralized mortgage obligations (10%). The Classic Institutional U.S. Government Securities Super Short Income Plus Fund has been an acceptable low risk bond fund alternative for money market investors. /s/ Robert W. Corner Robert W. Corner Managing Director 11 INSTITUTIONAL SHARES(1) AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2004) - -------------------------------------------------------------- Annualized Cumulative Inception Inception One Year to Date to Date - -------------------------------------------------------------- 1.01% 1.93% 4.18% - -------------------------------------------------------------- [GRAPHIC OMITTED] EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $1,000,000 INVESTMENT
STI Classic U.S. Government Super Short iMoney Net Citigroup Income Plus Fund, Net Government 6 Month Lipper Ultra-Short Institutional Shares Institutional Average Treasury Bill Index Obligations Objective 4/30/02 $1,000,000 $1,000,000 $1,000,000 $1,000,000 5/02 1,002,000 1,001,200 1,001,600 1,002,600 5/03 1,030,056 1,012,714 1,017,525 1,026,362 5/04 1,040,460 1,018,891 1,028,209 1,036,112
L SHARES(2) AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2004) - --------------------------------------------------------------- Annualized Cumulative Inception Inception One Year to Date to Date - --------------------------------------------------------------- 0.47% 1.70% 3.66% - --------------------------------------------------------------- [GRAPHIC OMITTED] EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $50,000 INVESTMENT
STI Classic U.S. Government Super Short iMoney Net Citigroup Income Plus Fund, Government 6 Month Lipper Ultra-Short L Shares Institutional Average Treasury Bill Index Obligations Objective 5/31/02 $50,000 $50,000 $50,000 $50,000 5/02 50,100 50,060 50,080 50,130 5/03 51,528 50,636 50,876 51,318 5/04 51,770 50,945 51,410 51,806
Past performance is no indication of future performance. The Funds' comparative benchmark does not include the annual operating expenses incurred by the Fund. (1) Institutional Shares were offered beginning on April 11, 2002. (2) L Shares were offered beginning on April 16, 2003. L Shares' performance for the period prior to April 16, 2003 reflects the performance of the Fund's Institutional Shares. The performance of the Institutional Shares has not been adjusted to reflect the higher operating expenses of the L Shares. If it had, performance would have been lower than that shown. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. 12 CLASSIC INSTITUTIONAL CASH MANAGEMENT MONEY MARKET FUND ------------------------------------------------------- The investment objective of the Classic Institutional Cash Management Money Market Fund is to provide as high a level of current income as is consistent with the preservation of capital and liquidity by investing exclusively in high quality money market instruments. The investment discipline used in managing the Fund, emphasizes adding incremental value through yield curve, sector and credit analysis. Investments are made in those sectors, credits and segments of the yield curve within the universe of money market eligible securities, which offer the most attractive risk/reward trade-off and current yield. The maturity structure and average maturity of the Fund are actively managed to maximize the yield of the Fund based on the current market rates and conditions and our market outlook. The Federal Reserve Open Market Committee is expected to raise interest rates at its upcoming June 30th meeting. In anticipation of this action interest rates have recently risen from historical lows. Over the last year the Federal Reserve has maintained the Funds Rate at a 45-year low of 1.00%. Our outlook is that the Federal Reserve will raise interest rates at the upcoming meeting as the economy continues to improve and to guard against an unexpected rise in inflation. We do expect the Federal Reserve to transition monetary policy from an accommodative stance to neutral over the balance of the year. With this in mind the portfolio has been structured to benefit from a rising rate policy by the Federal Reserve. The Fund was able to meet its objective and was able to provide a very competitive return and yield as compared to its peer money market funds during the year ending May 31, 2004. The Fund had a one-year return of 0.86% as compared to the iMoneyNet, Inc. First Tier Institutional Average return of 0.73%. /s/Robert S. Bowman Robert S. Bowman, CFA Managing Director 13 CLASSIC INSTITUTIONAL U.S. GOVERNMENT SECURITIES MONEY MARKET FUND ------------------------------------------------------------------ The investment objective of the STI Classic U.S. Government Securities Money Market Fund is to provide as high a level of current income as is consistent with the preservation of capital and liquidity by investing exclusively in money market eligible securities. Eligible securities include U.S. Government Agency securities and repurchase agreements collateralized by U.S. Government Agency obligations. The investment discipline, which we use in managing the Fund, emphasizes adding incremental value through yield curve analysis. The maturity structure and average maturity of the Fund are actively managed to maximize the yield of the Fund based on the current market rates and conditions and our market outlook. The Federal Reserve Open Market Committee is expected to raise interest rates at its upcoming June 30th meeting. In anticipation of this action interest rates have recently risen from historical lows. Over the last year the Federal Reserve has maintained the Funds Rate at a 45-year low of 1.00%. Our outlook is that the Federal Reserve will raise interest rates at the upcoming meeting as the economy continues to improve and to guard against an unexpected rise in inflation. We do expect the Federal Reserve to transition monetary policy from an accommodative stance to neutral over the balance of the year. With this in mind the portfolio has been structured to benefit from a rising rate policy by the Federal Reserve. The Fund was able to meet its objective and was able to provide a very competitive return and yield as compared to its peer money market funds during the year ending May 31, 2004. The Fund has a one-year return of 0.82% as compared to the iMoneyNet, Inc. Government Institutional Average return of 0.61%. /s/Robert S. Bowman Robert S. Bowman, CFA Managing Director CLASSIC INSTITUTIONAL U.S. TREASURY SECURITIES MONEY MARKET FUND ---------------------------------------------------------------- The investment objective of the Classic Institutional U.S. Treasury Securities Money Market Fund is to provide as high a level of current income as is consistent with the preservation of capital and liquidity by investing exclusively in money market eligible securities. Eligible securities include U.S. Treasury securities and repurchase agreements collateralized by U.S. Treasury obligations. The investment discipline, which we use in managing the Fund, emphasizes adding incremental value through yield curve analysis. The maturity structure and average maturity of the Fund are actively managed to maximize the yield of the Fund based on the current market rates and conditions and our market outlook. The Federal Reserve maintained the Funds Rate at a 45-year low of 1.00% since June of last year. The Federal Reserve Open Market Committee is expected to raise the Federal Funds Rate and Discount Rate at its upcoming June 30th meeting. In anticipation of this action interest rates have recently risen from historical lows. Our outlook is that the Federal Reserve will raise interest rates at the upcoming meeting as the economy continues to improve and to guard against an unexpected rise in inflation. We do expect the Federal Reserve to transition monetary policy from an accommodative stance to neutral over the balance of the year. With this in mind the portfolio has been structured to benefit from a rising rate policy by the Federal Reserve. The Fund was able to meet its objective and was able to provide a very competitive return and yield as compared to its peer money market funds during the year ending May 31, 2004. The Fund's Institutional Shares had a one-year return of 0.77% and the Fund's Corporate Trust Shares had a return of 0.57% as compared to the iMoneyNet, Inc. U.S. Treasury & Repo Average return of 0.36%. /s/David S. Yealy David S. Yealy Managing Director 14 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 CLASSIC INSTITUTIONAL HIGH QUALITY BOND FUND - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ U.S. TREASURY OBLIGATIONS (36.2%) U.S. Treasury Notes 5.750%, 08/15/10 $2,000 $ 2,178 5.375%, 02/15/31 4,175 4,191 4.375%, 08/15/12 6,310 6,260 4.250%, 08/15/13 8,750 8,507 3.250%, 08/15/07 4,150 4,160 3.125%, 10/15/08 6,000 5,875 1.625%, 09/30/05 17,500 17,397 -------- Total U.S. Treasury Obligations (Cost $49,570) 48,568 -------- U.S. GOVERNMENT AGENCY OBLIGATIONS (26.8%) FHLB, Ser 421 3.875%, 06/14/13 3,000 2,735 FHLB, Ser 430 2.875%, 09/15/06 4,000 3,985 FHLB, Ser 443 1.625%, 06/15/05 5,000 4,980 FHLB, Ser DQ07 2.625%, 05/15/07 350 342 FHLMC 6.625%, 09/15/09 625 691 5.875%, 03/21/11 1,670 1,748 5.500%, 07/15/06 2,000 2,108 5.250%, 01/15/06 4,025 4,198 3.875%, 01/12/09 965 947 3.050%, 01/19/07 1,200 1,196 2.125%, 11/15/05 3,000 2,989 FNMA 5.500%, 05/02/06 2,025 2,120 4.100%, 08/27/08 1,200 1,203 4.000%, 12/15/08 1,225 1,208 3.375%, 12/15/08 3,000 2,906 2.625%, 01/19/07 2,750 2,702 -------- Total U.S. Government Agency Obligations (Cost $36,647) 36,058 -------- - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ CORPORATE OBLIGATIONS (19.7%) BANKS (1.8%) Bank One 5.500%, 03/26/07 $ 480 $ 505 Bank of America 4.750%, 10/15/06 300 310 Wachovia 6.800%, 06/01/05 1,590 1,658 -------- 2,473 COMMUNICATION SERVICES (0.4%) SBC Communications 5.750%, 05/02/06 550 578 -------- COMPUTER SERVICES (0.2%) Computer Sciences 3.500%, 04/15/08 200 196 First Data 3.375%, 08/01/08 60 58 -------- 254 FINANCE (9.4%) Boeing Capital 6.100%, 03/01/11 805 845 CIT Group 4.125%, 02/21/06 1,065 1,087 General Electric Capital 3.500%, 05/01/08 2,120 2,082 Golden West Financial 4.125%, 08/15/07 750 759 Household Finance 5.750%, 01/30/07 1,060 1,119 International Lease Finance 3.750%, 08/01/07 1,590 1,584 Merrill Lynch, Ser B, MTN 3.375%, 09/14/07 1,580 1,562 National Rural Utilities 3.000%, 02/15/06 380 381 SLM, MTN 3.625%, 03/17/08 855 847 15 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 CLASSIC INSTITUTIONAL HIGH QUALITY BOND FUND -- CONCLUDED - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ FINANCE--CONTINUED Verizon Global Funding 7.250%, 12/01/10 $1,295 $ 1,447 Wells Fargo 3.500%, 04/04/08 850 836 -------- 12,549 FOOD, BEVERAGE & TOBACCO (0.7%) Coca-Cola Enterprises 5.250%, 05/15/07 865 908 -------- INSURANCE (0.8%) Prudential Financial, Ser B, MTN 4.750%, 04/01/14 1,190 1,105 -------- INVESTMENT BANKERS/BROKER DEALERS (3.6%) Bear Stearns 4.000%, 01/31/08 1,170 1,170 Citigroup 6.750%, 12/01/05 200 212 Goldman Sachs Group 4.750%, 07/15/13 615 575 JP Morgan Chase 5.250%, 05/30/07 1,060 1,106 Morgan Stanley 4.750%, 04/01/14 1,250 1,149 3.625%, 04/01/08 675 667 -------- 4,879 METALS (0.7%) Alcan 5.200%, 01/15/14 1,000 974 -------- PETROLEUM & FUEL PRODUCTS (0.9%) Conoco Funding 5.450%, 10/15/06 1,000 1,055 ConocoPhillips 8.500%, 05/25/05 100 106 -------- 1,161 - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ UTILITIES (1.2%) Alabama Power, Ser X 3.125%, 05/01/08 $ 425 $ 411 PacifiCorp 6.900%, 11/15/11 1,100 1,226 -------- 1,637 -------- Total Corporate Obligations (Cost $27,384) 26,518 -------- U.S. GOVERNMENT AGENCY MORTGAGE-BACKED OBLIGATIONS (7.1%) FHLMC, Ser A14166 5.000%, 10/01/33 1,071 1,030 FHLMC, Ser B11936 4.500%, 01/01/19 928 908 FHLMC, Ser E01488 5.000%, 10/01/18 407 407 FHLMC, Ser E01489 4.500%, 11/01/18 327 320 FHLMC, Ser G11453 6.000%, 10/01/14 1,806 1,883 FNMA, Ser 384981 5.725%, 03/01/12 237 250 FNMA, Ser 385097 6.260%, 05/01/12 314 340 FNMA, Ser 545759 6.500%, 07/01/32 1,727 1,789 FNMA, Ser 747594 6.500%, 11/01/33 478 495 GNMA, Ser 595260 5.500%, 12/15/32 209 208 GNMA, Ser 604549 5.000%, 08/15/33 93 90 GNMA, Ser 604945 5.000%, 01/15/34 969 935 GNMA, Ser 604946 5.500%, 01/15/34 834 830 -------- Total U.S. Government Agency Mortgage-Backed Obligations (Cost $9,654) 9,485 -------- 16 - ------------------------------------------------------------ FACE AMOUNT (000)/SHARES VALUE (000) - ------------------------------------------------------------ ASSET-BACKED SECURITIES (4.7%) Capital Auto Receivables Asset Trust, Ser 2002-2, Cl A4 4.500%, 10/15/07 $1,000 $ 1,021 Citibank Credit Card Issuance Trust, Ser 2004-A1, Cl A1 2.550%, 01/20/09 2,135 2,096 General Electric Commercial Mortgage, Ser 2002-1A, Cl A3 6.269%, 12/10/35 1,000 1,075 Jp Morgan Chase Commercial Mortgage Security, Ser 2004-CB8, Cl A4 4.404%, 01/12/39 1,690 1,569 Whole Auto Loan Trust, Ser 2003-1, Cl A3A 1.840%, 10/15/06 500 498 -------- Total Asset-Backed Securities (Cost $6,515) 6,259 -------- CASH EQUIVALENT (4.6%) Federated Prime Value Money Market Fund 6,186,773 6,187 -------- Total Cash Equivalent (Cost $6,187) 6,187 -------- Total Investments (99.1%) (Cost $135,957) 133,075 -------- - ------------------------------------------------------------ VALUE (000) - ------------------------------------------------------------ OTHER ASSETS AND LIABILITIES (0.9%) Receivable from Adviser $ 6 Investment Advisory Fees Payable (45) Shareholder Service Fees Payable (26) Payable to Affiliated Funds (14) Administration Fees Payable (8) Custodian Fees Payable (1) Transfer Agent Shareholder Servicing Fees Payable (1) Other Assets and Liabilities, Net 1,302 -------- Total Other Assets and Liabilities 1,213 -------- NET ASSETS: Paid in Capital -- Institutional Shares (unlimited authorization -- no par value) based on 2,590,795 outstanding shares of beneficial interest 25,887 Paid in Capital -- T Shares (unlimited authorization -- no par value) based on 11,049,979 outstanding shares of beneficial interest 111,119 Undistributed net investment income 3 Accumulated net realized gain on investments 161 Net unrealized depreciation on investments (2,882) -------- Total Net Assets (100.0%) $134,288 ======== Net Asset Value, Offering and Redemption Price Per Share -- Institutional Shares ($25,505,818 / 2,590,795 shares) $9.84 ======== Net Asset Value, Offering and Redemption Price Per Share -- T Shares ($108,781,920 / 11,049,979 shares) $9.84 ======== THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. FOR DESCRIPTIONS OF ABBREVIATIONS AND FOOTNOTES, PLEASE SEE PAGE 45. 17 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 CLASSIC INSTITUTIONAL SHORT-TERM BOND FUND - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ CORPORATE OBLIGATIONS (37.4%) AUTOMOTIVE (2.7%) DaimlerChrysler 7.750%, 06/15/05 $ 250 $ 263 Ford Motor Credit 7.500%, 03/15/05 175 182 6.875%, 02/01/06 175 184 GMAC 6.750%, 01/15/06 305 321 ------- 950 ------- BANKS (3.0%) Bank of America 5.250%, 02/01/07 275 287 KFW International Finance, Ser DTC 4.750%, 01/24/07 335 349 Wachovia 6.800%, 06/01/05 425 443 ------- 1,079 ------- CABLE (0.9%) Comcast Cable Communications 8.375%, 05/01/07 145 163 Intelsat 5.250%, 11/01/08 90 83 Univision Communications 2.875%, 10/15/06 85 84 ------- 330 ------- CAPITAL GOODS (0.5%) Masco 6.750%, 03/15/06 160 171 ------- FINANCE (9.1%) Boeing Capital 5.650%, 05/15/06 145 152 Capital One Financial 7.250%, 05/01/06 150 160 CIT Group 4.125%, 02/21/06 425 434 - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ FINANCE--CONTINUED Citigroup 6.750%, 12/01/05 $ 450 $ 477 Countrywide Home Loan, Ser J, MTN 5.500%, 08/01/06 350 366 Household Finance 6.500%, 01/24/06 395 418 International Lease Finance 3.500%, 04/01/09 125 119 JP Morgan Chase 5.250%, 05/30/07 345 360 National Rural Utilities 3.000%, 02/15/06 425 426 SLM, Ser A, MTN (B) 1.310%, 09/15/06 330 331 ------- 3,243 ------- FOOD, BEVERAGE & TOBACCO (2.5%) Coca-Cola Enterprises 5.250%, 05/15/07 450 473 ConAgra Foods 7.500%, 09/15/05 90 95 Diageo Capital PLC 3.375%, 03/20/08 170 166 Safeway 6.150%, 03/01/06 160 168 ------- 902 ------- GOVERNMENT-REGIONAL (0.7%) Quebec Providence 5.500%, 04/11/06 225 236 ------- INDUSTRIAL (0.6%) Weyerhaeuser 6.125%, 03/15/07 215 228 ------- 18 - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ INSURANCE (1.9%) Allstate 7.875%, 05/01/05 $ 455 $ 478 MetLife 3.911%, 05/15/05 115 117 Safeco 4.200%, 02/01/08 65 66 ------- 661 ------- INVESTMENT BANKERS/BROKER DEALERS (5.6%) Bear Stearns 5.700%, 01/15/07 275 290 Credit Suisse First Boston 5.875%, 08/01/06 325 343 Goldman Sachs Group 7.625%, 08/17/05 450 477 Lehman Brothers Holdings 7.750%, 01/15/05 225 233 Merrill Lynch, Ser B, MTN 3.375%, 09/14/07 435 430 Morgan Stanley 7.750%, 06/15/05 225 238 ------- 2,011 ------- MULTIMEDIA (1.8%) Liberty Media 3.500%, 09/25/06 200 200 Time Warner 6.125%, 04/15/06 175 184 Viacom 7.750%, 06/01/05 250 264 ------- 648 ------- PETROLEUM & FUEL PRODUCTS (1.7%) Anadarko Petroleum 3.250%, 05/01/08 165 161 ConocoPhillips 8.500%, 05/25/05 250 265 - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ PETROLEUM & FUEL PRODUCTS--CONTINUED Kerr-McGee 5.875%, 09/15/06 $ 160 $ 168 ------- 594 ------- REAL ESTATE (0.4%) EOP Operating LP 8.375%, 03/15/06 150 164 ------- RETAIL (0.5%) Kroger 7.375%, 03/01/05 160 166 ------- TELEPHONE & TELECOMMUNICATIONS (4.2%) AT&T Wireless 7.500%, 05/01/07 210 231 British Telecom PLC 7.875%, 12/15/05 325 350 Deutsche Telekom 8.250%, 06/15/05 300 318 Verizon Wireless 5.375%, 12/15/06 225 236 Vodafone Group PLC (A) 7.625%, 02/15/05 340 353 ------- 1,488 ------- UTILITIES (1.3%) Alabama Power, Ser X 3.125%, 05/01/08 50 48 Dominion Resources, Ser B 7.625%, 07/15/05 175 185 PacifiCorp 6.750%, 04/01/05 100 104 Pacific Gas & Electric (B) 1.810%, 04/03/06 125 125 ------- 462 ------- Total Corporate Obligations (Cost $13,725) 13,333 ------- 19 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 CLASSIC INSTITUTIONAL SHORT-TERM BOND FUND -- CONCLUDED - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ U.S. GOVERNMENT AGENCY OBLIGATIONS (24.1%) FHLB, Ser 322 3.250%, 08/15/05 $ 875 $ 886 FHLB, Ser 392 2.500%, 03/15/06 1,075 1,071 FHLB, Ser DQ07 2.625%, 05/15/07 100 98 FHLMC 4.250%, 06/15/05 875 895 3.375%, 04/15/09 185 178 3.050%, 01/19/07 400 399 2.875%, 11/03/06 525 521 2.400%, 03/29/07 425 415 2.375%, 02/15/07 345 337 FHLMC, MTN 2.500%, 12/04/06 425 419 2.050%, 07/14/06 425 418 FNMA 3.875%, 03/15/05 1,750 1,780 3.125%, 03/16/09 175 166 2.625%, 01/19/07 525 516 1.875%, 12/15/04 500 501 ------- Total U.S. Government Agency Obligations (Cost $8,669) 8,600 ------- U.S. TREASURY OBLIGATIONS (18.4%) U.S. Treasury Notes 5.750%, 11/15/05 (E) 2,225 2,339 3.125%, 05/15/07 875 876 2.625%, 03/15/09 1,090 1,036 2.250%, 02/15/07 (E) 815 800 2.000%, 11/30/04 725 727 1.250%, 05/31/05 775 771 ------- Total U.S. Treasury Obligations (Cost $6,587) 6,549 ------- - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ ASSET-BACKED SECURITIES (12.0%) Bank One Issuance Trust, Ser 2002-A4, Cl A4 2.940%, 06/16/08 $ 500 $ 503 Capital Auto Receivables Asset Trust, Ser 2002-3, Cl A3 3.580%, 10/16/06 350 355 Capital Auto Receivables Asset Trust, Ser 2002-4, Cl A4 2.640%, 03/17/08 500 500 Citibank Credit Card Issuance Trust, Ser 2001-A8, Cl A8 4.100%, 12/07/06 300 304 Citibank Credit Card Issuance Trust, Ser 2004-A1, Cl A1 2.550%, 01/20/09 350 344 DaimlerChrysler Auto Trust, Ser 2004-A, Cl A2 1.410%, 11/08/06 575 573 Ford Credit Auto Owner Trust, Ser 2004-A, Cl A2 2.130%, 10/15/06 425 425 Honda Automobile Receivables Owner Trust, Ser 2002-3, Cl A4 3.610%, 12/18/07 500 508 MBNA Credit Card Master Note Trust, Ser 2003-A11, Cl A11 3.650%, 03/15/11 300 295 USAA Auto Owner Trust, Ser 2004-1, Cl A3 2.060%, 04/15/08 450 444 ------- Total Asset-Backed Securities (Cost $3,948) 4,251 ------- 20 - ------------------------------------------------------------ FACE AMOUNT (000)/SHARES VALUE (000) - ------------------------------------------------------------ U.S. GOVERNMENT AGENCY MORTGAGE-BACKED OBLIGATIONS (6.8%) FHLMC, Ser 2558, Cl BA 5.000%, 05/15/11 $ 118 $ 120 FHLMC, Ser 780675 (B) 3.352%, 07/01/33 225 226 FHLMC, Ser 847259 (B) 4.359%, 03/01/34 405 406 FHLMC, Ser M90826 4.000%, 07/01/08 237 237 FNMA, Ser 2003-9, Cl UA 4.000%, 11/25/16 275 278 FNMA, Ser 555817 (B) 3.135%, 09/01/33 225 229 FNMA, Ser 555844 (B) 3.108%, 10/01/33 269 279 FNMA, Ser 688988 (B) 3.195%, 05/01/33 288 288 FNMA, Ser 772346 (B) 4.360%, 03/01/34 347 347 ------- Total U.S. Government Agency Mortgage-Backed Obligations (Cost $2,428) 2,410 ------- CASH EQUIVALENTS (5.3%) Boston Global Investment Trust Enhanced Portfolio (F) 1,799,250 1,799 Federated Prime Value Money Market Fund 107,383 107 ------- Total Cash Equivalents (Cost $1,906) 1,906 ------- Total Investments (104.0%) (Cost $37,263) 37,049 ------- - ------------------------------------------------------------ VALUE (000) - ------------------------------------------------------------ OTHER ASSETS AND LIABILITIES (-4.0%) Payable Upon Return of Securities Loaned $(1,799) Investment Advisory Fees Payable (11) Administration Fees Payable (2) Other Assets and Liabilities, Net 372 ------- Total Other Assets and Liabilities (1,440) ------- NET ASSETS: Paid in Capital -- Institutional Shares (unlimited authorization -- no par value) based on 3,554,721 outstanding shares of beneficial interest 35,766 Undistributed net investment income 1 Accumulated net realized gain on investments 56 Net unrealized depreciation on investments (214) ------- Total Net Assets (100.0%) $35,609 ======= Net Asset Value, Offering and Redemption Price Per Share -- Institutional Shares ($35,609,402 / 3,554,721 shares) $10.02 ======= THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. FOR DESCRIPTIONS OF ABBREVIATIONS AND FOOTNOTES, PLEASE SEE PAGE 45. 21 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 CLASSIC INSTITUTIONAL SUPER SHORT INCOME PLUS FUND - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ CORPORATE OBLIGATIONS (34.4%) AEROSPACE & DEFENSE (0.4%) Northrop Grumman 8.625%, 10/15/04 $1,000 $ 1,025 --------- AUTOMOTIVE (0.4%) DaimlerChrysler 6.400%, 05/15/06 1,000 1,056 --------- BANKS (3.8%) Bank of America 6.625%, 06/15/04 2,000 2,002 Capital One Bank 6.500%, 07/30/04 1,500 1,512 PNC Funding 7.000%, 09/01/04 2,000 2,028 US Bank (B) 1.120%, 12/05/05 2,000 2,001 Wells Fargo 6.625%, 07/15/04 1,000 1,006 1.220%, 03/03/06 (B) 1,000 1,002 --------- 9,551 --------- BUILDING & CONSTRUCTION (0.2%) Masco 6.750%, 03/15/06 500 533 --------- CABLE (1.7%) Cox Communications 7.500%, 08/15/04 1,500 1,517 TCI Communications 8.650%, 09/15/04 1,400 1,430 6.875%, 02/15/06 500 531 Univision Communications 2.875%, 10/15/06 875 864 --------- 4,342 --------- - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ COMMUNICATION SERVICES (0.2%) Liberty Media 3.500%, 09/25/06 $ 500 $ 500 --------- ELECTRICAL SERVICES (1.6%) Alabama Power, Ser N 4.875%, 09/01/04 1,500 1,512 Alabama Power, Ser Y 2.800%, 12/01/06 500 494 Pacific Gas & Electric (B) 1.810%, 04/03/06 775 775 Virginia Electric & Power 5.750%, 03/31/06 1,250 1,311 --------- 4,092 --------- FINANCE (9.1%) American Honda Finance, MTN (A) (B) 1.282%, 01/16/07 2,500 2,499 Capital One Financial 7.250%, 05/01/06 750 798 CIT Group 4.125%, 02/21/06 1,000 1,021 CIT Group, MTN (B) 1.470%, 05/18/07 2,500 2,498 Countrywide Home Loan 6.850%, 06/15/04 1,475 1,478 Countrywide Home Loan, Ser J, MTN 5.500%, 08/01/06 1,000 1,047 Ford Motor Credit 7.500%, 03/15/05 1,500 1,559 6.875%, 02/01/06 500 525 General Electric Capital, Ser A, MTN 5.375%, 03/15/07 1,000 1,051 General Electric Capital, Ser A, MTN (B) 1.235%, 03/15/05 2,000 2,003 22 - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ FINANCE--CONTINUED GMAC 6.850%, 06/17/04 $1,000 $ 1,002 6.750%, 01/15/06 750 789 6.125%, 09/15/06 750 783 Household Finance 5.750%, 01/30/07 1,000 1,056 SLM, Ser A, MTN (B) 1.370%, 01/25/06 2,000 2,005 1.310%, 09/15/06 2,000 2,006 Textron Financial, Ser E, MTN 2.750%, 06/01/06 635 631 --------- 22,751 --------- FOOD, BEVERAGE & TOBACCO (1.3%) Conagra Foods 7.500%, 09/15/05 750 795 Diageo Capital PLC 6.625%, 06/24/04 1,350 1,355 Safeway 6.150%, 03/01/06 1,000 1,051 --------- 3,201 --------- FORESTRY (0.5%) Weyerhaeuser 5.500%, 03/15/05 1,250 1,283 --------- INDUSTRIAL (0.4%) PPG Industries 6.750%, 08/15/04 1,000 1,011 --------- INSURANCE (2.3%) ASIF Global (A) (B) 1.440%, 05/30/06 2,500 2,506 MetLife Global (A) (B) 1.450%, 08/28/06 3,250 3,255 --------- 5,761 --------- - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ INVESTMENT BANKERS/BROKER DEALERS (5.8%) Credit Suisse, MTN (B) 1.540%, 02/22/05 $2,000 $ 2,004 Goldman Sachs Group, MTN (B) 1.210%, 03/30/07 3,000 2,998 JP Morgan Chase 5.625%, 08/15/06 1,000 1,054 JP Morgan Chase, Ser C, MTN (B) 1.240%, 12/18/06 3,000 3,005 Merrill Lynch, Ser B, MTN 5.350%, 06/15/04 2,875 2,879 Morgan Stanley (B) 1.280%, 01/12/07 2,500 2,502 --------- 14,442 --------- METALS & MINING (0.4%) 3M, Ser C, MTN 4.250%, 09/01/04 1,000 1,007 --------- MULTIMEDIA (1.0%) Time Warner 6.125%, 04/15/06 1,000 1,053 Viacom 7.750%, 06/01/05 1,250 1,319 --------- 2,372 --------- PETROLEUM & FUEL PRODUCTS (0.3%) Kerr-McGee 5.875%, 09/15/06 750 788 --------- REAL ESTATE INVESTMENT TRUSTS (0.5%) EOP Operating LP 6.500%, 06/15/04 1,250 1,252 --------- RETAIL (1.6%) Kroger 7.375%, 03/01/05 1,500 1,558 May Department Stores 7.150%, 08/15/04 475 480 23 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 CLASSIC INSTITUTIONAL SUPER SHORT INCOME PLUS FUND -- CONTINUED - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ RETAIL--CONTINUED Wal-Mart Stores, MTN (B) 1.238%, 02/22/05 $1,875 $ 1,875 --------- 3,913 --------- TELEPHONE & TELECOMMUNICATIONS (2.7%) British Telecom PLC 7.875%, 12/15/05 1,000 1,076 Deutsche Telekom 8.250%, 06/15/05 1,500 1,588 SBC Communications 5.750%, 05/02/06 1,000 1,051 Verizon Global Funding 6.750%, 12/01/05 1,250 1,326 Vodafone Group PLC (A) 7.625%, 02/15/05 1,500 1,560 --------- 6,601 --------- TRANSPORTATION (0.2%) Union Pacific 6.400%, 02/01/06 500 528 --------- Total Corporate Obligations (Cost $86,107) 86,009 --------- ASSET-BACKED SECURITIES (26.4%) BMW Vehicle Owner Trust, Ser 2003-A, Cl A2 1.450%, 11/25/05 306 306 Bank One Issuance Trust, Ser 2003-A5, Cl A5 (B) 1.150%, 02/17/09 2,500 2,501 Capital Auto Receivables Asset Trust, Ser 2001-2, Cl A4 5.000%, 12/15/06 4,375 4,383 Capital Auto Receivables Asset Trust, Ser 2003-1, Cl A2A 2.270%, 01/17/06 925 928 - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ ASSET-BACKED SECURITIES--CONTINUED CIT Equipment Collateral, Ser 2003-VT1, Cl A3A (B) 1.230%, 04/20/07 $2,000 $ 2,003 CIT Group Home Loan Equity Trust, Ser 2003-1, Cl A1 (B) 1.190%, 08/20/18 26 26 Citibank Credit Card Issuance Trust, Ser 2003-A2, Cl A2 2.700%, 01/15/08 1,500 1,501 Collegiate Funding Services Education Loan, Ser 2003-B, Cl A6 (B) 1.200%, 12/28/43 2,500 2,500 DaimlerChrysler Auto Trust, Ser 2004-A, Cl A2 1.410%, 11/08/06 1,750 1,742 DaimlerChrysler Master Owner Trust, Ser 2003-A, Cl A (B) 1.150%, 02/15/08 2,575 2,577 Education Funding Capital Trust I, Ser 2003-A1, Cl 8 (B) 1.140%, 06/01/42 2,500 2,500 Education Loans, Ser 2003-1, Cl A (B) 1.250%, 12/01/35 2,500 2,500 First USA Credit Master Trust, Ser 2001-1, Cl A (B) 1.250%, 09/19/08 3,500 3,508 Ford Credit Owner Trust, Ser 2003-B, Cl A2A 1.400%, 06/15/05 940 940 GMAC Mortgage Corporation Loan Trust, Ser 2003-HE1, Cl A1 (B) 1.190%, 04/25/33 1,000 1,000 GMAC Mortgage Corporation Loan Trust, Ser 2004-HE1, Cl A1 (B) 1.180%, 06/25/34 2,275 2,275 24 - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ ASSET-BACKED SECURITIES--CONTINUED Harley Davidson Motorcycle Trust, Ser 2004-1, Cl A1 1.400%, 10/15/08 $2,451 $ 2,439 Honda Auto Receivables Owner Trust, Ser 2003-2, Cl A2 1.340%, 12/21/05 1,533 1,532 MBNA Master Credit Card Trust, Ser 2000-C, Cl A (B) 1.260%, 07/15/07 2,500 2,503 Navistar Financial Corporate Owner Trust, Ser 2002-B, Cl A3A (B) 1.350%, 03/15/07 2,296 2,296 Nelnet Student Loan Corporation, Ser 2002-A, Cl A7 (B) 1.100%, 06/01/35 2,500 2,500 Nissan Auto Receivables Owner Trust, Ser 2002-A, Cl A4 4.280%, 10/16/06 1,750 1,779 Nissan Master Owner Trust Receivables, Ser 2003-A, Cl A1 (B) 1.160%, 09/15/08 3,000 3,002 Regions Auto Receivables Trust, Ser 2003-2, Cl A1 1.164%, 11/15/04 640 640 Residential Asset Mortgage Products, Ser 2004-RS2, Cl AI1 (B) 1.230%, 01/25/24 883 883 Residential Asset Securites Corporation, Ser 2003-KS11, Cl AI1 (B) 1.270%, 09/25/21 1,231 1,231 Residential Asset Securities Corporation, Ser 2002-KS6, Cl AI3 3.580%, 12/25/26 1,500 1,509 - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ ASSET-BACKED SECURITIES--CONTINUED Residential Asset Securities Corporation, Ser 2002-KS8, Cl A2 3.040%, 05/25/23 $ 879 $ 880 SLM Student Loan Trust, Ser 2003-11, Cl A1 (B) 1.110%, 09/15/09 2,712 2,711 SLM Student Loan Trust, Ser 2004-2, Cl A2 (B) 1.190%, 04/25/13 3,000 2,998 Student Loan Financial Association, Ser 2003-04, Cl A (B) 1.200%, 12/01/38 2,500 2,500 Toyota Auto Receivables Owner Trust, Ser 2003-B, Cl A3 (B) 1.130%, 08/15/07 3,000 3,001 USAA Auto Owner Trust, Ser 2004-1, Cl A3 2.060%, 04/15/08 2,150 2,122 Washington Mutual, Ser 2003-AR12, Cl A1 (B) 1.601%, 02/25/34 287 287 --------- Total Asset-Backed Securities (Cost $66,161) 66,003 --------- U.S. GOVERNMENT AGENCY MORTGAGE-BACKED OBLIGATIONS (15.5%) FHLMC, Ser 1520, Cl H 6.250%, 11/15/07 398 401 FHLMC, Ser 1629, Cl HA 3.500%, 12/15/21 109 109 FHLMC, Ser 1B1002 (B) 3.686%, 08/01/33 1,184 1,174 FHLMC, Ser 2485, Cl AF 5.500%, 12/15/15 242 251 FHLMC, Ser 2485, Cl AH 5.500%, 12/15/13 13 13 25 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 CLASSIC INSTITUTIONAL SUPER SHORT INCOME PLUS FUND -- CONTINUED - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ U.S. GOVERNMENT AGENCY MORTGAGE-BACKED OBLIGATIONS--CONTINUED FHLMC, Ser 2497, Cl NM 4.500%, 05/15/14 $ 165 $ 167 FHLMC, Ser 2508, Cl MF 5.000%, 04/15/13 305 309 FHLMC, Ser 2542, Cl AG 4.000%, 11/15/11 1,610 1,623 FHLMC, Ser 2558, Cl BA 5.000%, 05/15/11 455 460 FHLMC, Ser 2572, Cl LB 5.000%, 04/15/16 1,000 1,024 FHLMC, Ser 2595, Cl AB 5.000%, 02/15/14 1,581 1,623 FHLMC, Ser 2685, Cl NA 4.000%, 11/15/06 1,953 1,973 FHLMC, Ser 780675 (B) 3.352%, 07/01/33 938 942 FHLMC, Ser 847259 (B) 4.359%, 03/01/34 2,025 2,032 FHLMC, Ser M80812 4.500%, 04/01/10 1,270 1,269 FHLMC, Ser M90803 4.500%, 03/01/08 1,332 1,349 FHLMC, Ser M90814 4.000%, 05/01/08 1,942 1,942 FHLMC, Ser M90818 4.000%, 06/01/08 1,694 1,694 FNMA, Ser 1993-197, Cl PH 6.000%, 07/25/08 1,415 1,439 FNMA, Ser 2003-9, Cl UA 4.000%, 11/25/16 1,500 1,519 FNMA, Ser 555817 (B) 3.135%, 09/01/33 2,287 2,328 FNMA, Ser 555844 (B) 3.108%, 10/01/33 2,772 2,870 FNMA, Ser 635082 (B) 5.128%, 05/01/32 897 928 - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ U.S. GOVERNMENT AGENCY MORTGAGE-BACKED OBLIGATIONS--CONTINUED FNMA, Ser 688988 (B) 3.195%, 05/01/33 $2,305 $ 2,305 FNMA, Ser 701045 (B) 3.473%, 04/01/33 1,619 1,624 FNMA, Ser 709050 (B) 3.781%, 06/01/33 2,196 2,192 FNMA, Ser 722615 (B) 3.703%, 08/01/33 1,066 1,060 FNMA, Ser 759258 (B) 3.372%, 01/01/34 1,448 1,452 FNMA, Ser 772346 (B) 4.360%, 03/01/34 1,313 1,315 GNMA, Ser 2003-79, Cl PA 5.500%, 01/20/21 1,186 1,196 --------- Total U.S. Government Agency Mortgage-Backed Obligations (Cost $38,714) 38,583 --------- U.S. GOVERNMENT AGENCY OBLIGATIONS (11.3%) FHLB 1.450%, 03/11/05 4,500 4,489 FHLMC 2.875%, 11/03/06 700 695 FHLMC (B) 1.135%, 11/07/05 5,500 5,500 1.100%, 10/07/05 3,000 2,999 FHLMC, MTN 2.500%, 12/04/06 700 690 FNMA 1.750%, 05/23/05 3,425 3,417 FNMA (B) 0.990%, 09/06/05 5,500 5,495 FNMA Discount Note (C) 1.053%, 07/21/04 5,000 4,993 --------- Total U.S. Government Agency Obligations (Cost $28,311) 28,278 --------- 26 - ------------------------------------------------------------ FACE AMOUNT (000)/SHARES VALUE (000) - ------------------------------------------------------------ COMMERCIAL PAPER (6.8%) FINANCE (3.9%) ABN Amro (C) 1.068%, 07/21/04 $4,750 $ 4,743 Bank of America (C) 1.163%, 06/01/04 5,000 5,000 --------- 9,743 --------- ASSET BACKED (2.9%) Ciesco LLC (C) 1.072%, 07/06/04 3,125 3,122 New Center Asset (C) 1.052%, 07/12/04 4,125 4,120 --------- 7,242 --------- Total Commercial Paper (Cost $16,985) 16,985 --------- MUNICIPAL BOND (1.0%) Student Loan Financial Association Education, RB (B) 1.250%, 06/01/38 2,450 2,450 --------- Total Municipal Bond (Cost $2,450) 2,450 --------- U.S. TREASURY OBLIGATION (0.3%) U.S. Treasury Note 2.250%, 02/15/07 850 835 --------- Total U.S. Treasury Obligation (Cost $833) 835 --------- CASH EQUIVALENTS (0.8%) Dreyfus Government Cash Management Fund 1,000,000 1,000 Federated Prime Value Money Market Fund 1,000,000 1,000 --------- Total Cash Equivalents (Cost $2,000) 2,000 --------- - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ REPURCHASE AGREEMENTS (3.9%) Merrill Lynch 1.020% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $6,429,141 (collateralized by FNMA Obligations: total market value $6,561,196) (D) $6,428 $ 6,428 UBS Paine Webber 1.010% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $3,305,886 (collateralized by FNMA Obligations: total market value $3,372,496) (D) 3,306 3,306 --------- Total Repurchase Agreements (Cost $9,734) 9,734 --------- Total Investments (100.4%) (Cost $251,295) 250,877 --------- OTHER ASSETS AND LIABILITIES (-0.4%) Receivable from Affiliated Funds 1 Investment Advisory Fees Payable (43) Shareholder Service Fees Payable (24) Administration Fees Payable (15) Payable to Adviser (1) Custodian Fees Payable (1) Transfer Agent Shareholder Servicing Fees Payable (1) Other Assets and Liabilities, Net (953) --------- Total Other Assets and Liabilities (1,037) --------- 27 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 CLASSIC INSTITUTIONAL SUPER SHORT INCOME PLUS FUND -- CONCLUDED - ----------------------------------------------------------- VALUE (000) - ----------------------------------------------------------- NET ASSETS: Paid in Capital -- Institutional Shares (unlimited authorization -- no par value) based on 56,061,108 outstanding shares of beneficial interest $112,758 Paid in Capital -- T Shares (unlimited authorization -- no par value) based on 68,790,145 outstanding shares of beneficial interest 138,111 Accumulated net realized loss on investments (611) Net unrealized depreciation on investments (418) --------- Total Net Assets (100.0%) $249,840 ========= Net Asset Value, Offering and Redemption Price Per Share -- Institutional Shares ($112,453,417 / 56,061,108 shares) $2.01 ========= Net Asset Value, Offering and Redemption Price Per Share -- T Shares ($137,386,936 / 68,790,145 shares) $2.00 ========= THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. FOR DESCRIPTIONS OF ABBREVIATIONS AND FOOTNOTES, PLEASE SEE PAGE 45. 28 CLASSIC INSTITUTIONAL TOTAL RETURN BOND FUND - ------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------- CORPORATE OBLIGATIONS (38.5%) AUTOMOTIVE (0.9%) DaimlerChrysler 4.750%, 01/15/08 $ 130 $ 130 Ford Motor 7.450%, 07/16/31 150 142 General Motors 8.375%, 07/15/33 160 167 ------- 439 ------- BANKS (1.7%) Bank One 5.500%, 03/26/07 50 53 Bank of America 4.750%, 10/15/06 100 103 First Union Capital, Ser A 7.935%, 01/15/27 100 109 First Union Institutional Capital I 8.040%, 12/01/26 150 163 Wachovia 6.800%, 06/01/05 100 104 Washington Mutual 4.625%, 04/01/14 150 137 Wells Fargo 3.500%, 04/04/08 100 98 Wells Fargo Capital I 7.960%, 12/15/26 50 55 ------- 822 ------- CABLE (3.7%) British Sky Broadcasting 8.200%, 07/15/09 115 133 Comcast 7.125%, 06/15/13 875 955 6.500%, 01/15/15 150 156 Cox Communications 7.125%, 10/01/12 30 33 - ------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------- CABLE--CONTINUED Rogers Cable 5.500%, 03/15/14 $ 500 $ 438 Univision Communications 3.500%, 10/15/07 35 35 ------- 1,750 ------- COMPUTER SERVICES (0.1%) Computer Sciences 3.500%, 04/15/08 70 68 ------- ENVIRONMENTAL SERVICES (1.0%) Allied Waste (A) 6.125%, 02/15/14 250 227 5.750%, 02/15/11 250 233 ------- 460 ------- FINANCE (7.6%) Boeing Capital 6.100%, 03/01/11 245 257 Capital One Bank 6.500%, 06/13/13 300 306 CIT Group 4.125%, 02/21/06 500 511 Citicorp Capital I 7.933%, 02/15/27 100 107 General Electric Capital 3.500%, 05/01/08 775 761 Golden West Financial 4.125%, 08/15/07 50 51 Household Finance 5.750%, 01/30/07 300 317 International Lease Finance 3.750%, 08/01/07 490 488 National Rural Utilities 3.000%, 02/15/06 70 70 SLM, MTN 3.625%, 03/17/08 100 99 Textron Financial, Ser E, MTN 2.750%, 06/01/06 30 30 29 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 CLASSIC INSTITUTIONAL TOTAL RETURN BOND FUND -- CONTINUED - ------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------- FINANCE--CONTINUED Verizon Global Funding 7.750%, 12/01/30 $ 130 $ 146 7.250%, 12/01/10 410 458 ------- 3,601 ------- FOOD, BEVERAGE & TOBACCO (1.1%) Albertson's 7.500%, 02/15/11 115 129 Kraft Foods 5.250%, 10/01/13 150 145 Safeway 6.150%, 03/01/06 240 253 ------- 527 ------- FORESTRY (0.3%) Millar Western Forest (A) 7.750%, 11/15/13 100 100 Weyerhaeuser 7.950%, 03/15/25 35 39 ------- 139 ------- GOVERNMENT-REGIONAL (1.1%) Province of Quebec 7.125%, 02/09/24 100 114 Republic of Brazil 8.250%, 01/20/34 150 109 Republic of Columbia 8.125%, 05/21/24 350 272 United Mexican States 4.625%, 10/08/08 35 35 ------- 530 ------- HOTELS & LODGING (1.5%) MGM Mirage 5.875%, 02/27/14 500 459 Station Casinos (A) 6.000%, 04/01/12 250 240 ------- 699 ------- - ------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------- INDUSTRIAL (1.8%) Alcan 6.125%, 12/15/33 $ 300 $ 287 International Paper 6.750%, 09/01/11 30 32 International Steel Group (A) 6.500%, 04/15/14 250 233 Masco 5.875%, 07/15/12 30 31 Packaging Corp. of America 5.750%, 08/01/13 275 272 ------- 855 ------- INSURANCE (1.0%) Fund American 5.875%, 05/15/13 135 134 Prudential Financial, Ser B, MTN 4.750%, 04/01/14 325 302 Safeco 6.875%, 07/15/07 30 33 ------- 469 ------- INVESTMENT BANKERS/BROKER DEALERS (3.9%) Bear Stearns 4.000%, 01/31/08 365 365 Goldman Sachs Capital I 6.345%, 02/15/34 410 385 JP Morgan Chase 5.250%, 05/30/07 315 329 Merrill Lynch, Ser B, MTN 3.375%, 09/14/07 500 494 Morgan Stanley 3.625%, 04/01/08 280 277 ------- 1,850 ------- 30 - ------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------- MEDICAL & MEDICAL PRODUCTS (1.4%) HCA 7.875%, 02/01/11 $ 525 $ 566 Wyeth 6.500%, 02/01/34 135 128 ------- 694 ------- MULTIMEDIA (0.4%) Time Warner 6.750%, 04/15/11 125 135 Viacom 7.875%, 09/01/23 35 40 ------- 175 ------- PETROLEUM & FUEL PRODUCTS (3.2%) Amerada Hess 7.125%, 03/15/33 220 219 Anadarko Petroleum 3.250%, 05/01/08 35 34 Conoco 6.950%, 04/15/29 320 350 Devon Financing 6.875%, 09/30/11 30 33 Evergreen Resources (A) 5.875%, 03/15/12 100 101 Kerr-McGee 5.875%, 09/15/06 210 220 Petro Mexicanos 9.250%, 03/30/18 210 236 XTO Energy 4.900%, 02/01/14 350 327 ------- 1,520 ------- PRINTING & PUBLISHING (0.2%) Reader's Digest 6.500%, 03/01/11 100 98 ------- - ------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------- REAL ESTATE INVESTMENT TRUSTS (1.0%) EOP Operating LP 8.375%, 03/15/06 $ 125 $ 136 Istar Financial 6.000%, 12/15/10 100 98 4.875%, 01/15/09 (A) 250 238 Simon Property Group LP 6.375%, 11/15/07 30 32 ------- 504 ------- RETAIL (0.6%) Ferrellgas (A) 6.750%, 05/01/14 250 239 May Department Stores 5.950%, 11/01/08 30 32 ------- 271 ------- TELEPHONE & TELECOMMUNICATIONS (2.1%) British Telecom PLC 7.875%, 12/15/05 30 32 Corning 5.900%, 03/15/14 300 280 Deutsche Telekom 8.750%, 06/15/30 105 128 Nextel Communications 5.950%, 03/15/14 300 278 Rogers Wireless (A) 6.375%, 03/01/14 250 235 US Cellular 6.700%, 12/15/33 30 28 ------- 981 ------- TRANSPORTATION (1.6%) Norfolk Southern 7.800%, 05/15/27 140 161 OMI 7.625%, 12/01/13 100 97 31 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 CLASSIC INSTITUTIONAL TOTAL RETURN BOND FUND -- CONCLUDED - ------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------- TRANSPORTATION--CONTINUED Overseas Shipholding Group 7.500%, 02/15/24 $ 500 $ 460 Union Pacific 5.750%, 10/15/07 30 32 ------- 750 ------- UTILITIES (2.3%) Alabama Power, Ser X 3.125%, 05/01/08 50 48 Carolina Power & Light 6.500%, 07/15/12 30 32 Centerpoint Energy Resources, Ser B 7.875%, 04/01/13 600 669 PacifiCorp 6.900%, 11/15/11 150 167 Pacific Gas & Electric 4.800%, 03/01/14 145 137 Southern California Edison 8.000%, 02/15/07 25 28 ------- 1,081 ------- Total Corporate Obligations (Cost $19,132) 18,283 ------- U.S. GOVERNMENT AGENCY MORTGAGE-BACKED OBLIGATIONS (32.6%) FHLMC, Ser 847259 (B) 4.359%, 03/01/34 415 416 FHLMC, Ser A13662 5.000%, 09/01/33 1,351 1,300 FHLMC, Ser A15182 6.000%, 11/01/33 1,220 1,241 FHLMC, Ser B11431 4.500%, 12/01/18 324 317 FHLMC, Ser B11936 4.500%, 01/01/19 1,855 1,816 FHLMC, Ser C90780 5.500%, 01/01/24 1,274 1,285 - ------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------- U.S. GOVERNMENT AGENCY MORTGAGE-BACKED OBLIGATIONS--CONTINUED FHLMC, Ser E01490 5.000%, 11/01/18 $ 457 $ 458 FHLMC, Ser E01539 5.500%, 12/01/18 184 188 FHLMC, Ser E01545 5.000%, 01/01/19 1,030 1,032 FHLMC, Ser E01582 6.000%, 01/01/19 760 790 FHLMC, Ser G01058 7.000%, 09/01/29 134 141 FNMA, Ser 254766 5.000%, 06/01/33 452 436 FNMA, Ser 254963 5.500%, 10/01/23 452 455 FNMA, Ser 545759 6.500%, 07/01/32 2,608 2,702 FNMA, Ser 747820 5.500%, 11/01/18 469 479 FNMA, Ser 757867 6.000%, 11/01/33 437 445 FNMA, Ser 759522 5.500%, 02/01/34 939 932 FNMA, Ser 766916 (B) 4.551%, 03/01/34 462 462 GNMA, Ser 604639 5.000%, 09/15/33 360 348 GNMA, Ser 621873 5.500%, 02/15/34 239 237 ------- Total U.S. Government Agency Mortgage-Backed Obligations (Cost $15,818) 15,480 ------- 32 - ------------------------------------------------------------- FACE AMOUNT (000)/SHARES VALUE (000) - ------------------------------------------------------------- U.S. TREASURY OBLIGATIONS (12.7%) U.S. Treasury Bonds 5.375%, 02/15/31 $1,300 $ 1,305 U.S. Treasury Notes 4.375%, 08/15/12 3,245 3,219 2.125%, 10/31/04 1,500 1,505 ------- Total U.S. Treasury Obligations (Cost $6,238) 6,029 ------- U.S. GOVERNMENT AGENCY OBLIGATIONS (9.4%) FHLB, Ser 430 2.875%, 09/15/06 1,500 1,494 FNMA 2.500%, 06/15/06 3,000 2,975 ------- Total U.S. Government Agency Obligations (Cost $4,508) 4,469 ------- ASSET-BACKED SECURITIES (2.5%) Citibank Credit Card Issuance Trust, Ser 2004-A1, Cl A1 2.550%, 01/20/09 745 731 JP Morgan Chase Commercial Mortgage, Ser 2004-CB8, Cl A4 4.404%, 01/12/39 485 451 ------- Total Asset-Backed Securities (Cost $1,232) 1,182 ------- CASH EQUIVALENT (3.3%) Federated Prime Value Money Market Fund 1,585,952 1,586 ------- Total Cash Equivalent (Cost $1,586) 1,586 ------- Total Investments (99.0%) (Cost $48,514) 47,029 ------- - ------------------------------------------------------------- VALUE (000) - ------------------------------------------------------------- OTHER ASSETS AND LIABILITIES (1.0%) Receivable from Adviser $ 10 Shareholder Service Fees Receivable 2 Payable to Affiliated Funds (17) Investment Advisory Fees Payable (14) Administration Fees Payable (3) Other Assets and Liabilities, Net 483 ------- Total Other Assets and Liabilities 461 ------- NET ASSETS: Paid in Capital -- Institutional Shares (unlimited authorization -- no par value) based on 1,586,205 outstanding shares of beneficial interest 15,985 Paid in Capital -- T Shares (unlimited authorization -- no par value) based on 3,255,949 outstanding shares of beneficial interest 33,214 Accumulated net realized loss on investments (224) Net unrealized depreciation on investments (1,485) ------- Total Net Assets (100.0%) $47,490 ======= Net Asset Value, Offering and Redemption Price Per Share -- Institutional Shares ($15,553,079 / 1,586,205 shares) $9.81 ======= Net Asset Value, Offering and Redemption Price Per Share -- T Shares ($31,936,507 / 3,255,949 shares) $9.81 ======= THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. FOR DESCRIPTIONS OF ABBREVIATIONS AND FOOTNOTES, PLEASE SEE PAGE 45. 33 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 CLASSIC INSTITUTIONAL U.S. GOVERNMENT SECURITIES SUPER SHORT INCOME PLUS FUND - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ U.S. GOVERNMENT AGENCY OBLIGATIONS (56.4%) FFCB (B) 1.010%, 04/29/05 $2,000 $ 2,000 FHLB 1.450%, 03/11/05 1,750 1,746 FHLB Discount Note (C) 1.179%, 08/25/04 3,000 2,992 1.032%, 07/09/04 3,000 2,997 0.970%, 06/02/04 1,750 1,750 FHLB, Ser 273 3.875%, 12/15/04 1,750 1,772 FHLB, Ser 412 (B) 0.975%, 09/20/04 3,875 3,874 FHLB, Ser 423 (B) 1.156%, 12/17/04 3,875 3,876 FHLMC 3.875%, 02/15/05 1,035 1,051 3.250%, 11/15/04 2,300 2,319 3.000%, 07/15/04 3,000 3,006 2.875%, 11/03/06 575 571 2.400%, 03/29/07 575 561 FHLMC (B) 1.135%, 11/07/05 2,500 2,500 1.100%, 10/07/05 2,000 2,000 1.085%, 09/09/05 2,500 2,500 FHLMC Discount Note (C) 1.039%, 07/06/04 3,000 2,996 FHLMC, MTN 2.500%, 12/04/06 325 320 2.000%, 02/23/06 575 570 FHLMC, Ser 1, MTN 2.500%, 11/25/05 1,000 996 FNMA 3.500%, 09/15/04 1,250 1,258 2.750%, 08/11/06 500 496 1.750%, 05/23/05 1,575 1,571 1.330%, 02/23/05 2,500 2,493 - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ U.S. GOVERNMENT AGENCY OBLIGATIONS--CONTINUED FNMA (B) 1.216%, 10/07/05 $3,000 $ 3,000 1.040%, 03/23/05 2,000 2,000 0.990%, 09/06/05 2,500 2,498 FNMA Discount Note (C) 1.052%, 07/21/04 3,000 2,996 1.034%, 06/15/04 3,000 2,999 1.002%, 06/09/04 3,000 2,999 SLMA, MTN (B) 1.516%, 08/27/04 2,500 2,503 -------- Total U.S. Government Agency Obligations (Cost $65,256) 65,210 -------- U.S. GOVERNMENT AGENCY MORTGAGE-BACKED OBLIGATIONS (27.0%) FHLMC, Ser 1520, Cl H 6.250%, 11/15/07 597 601 FHLMC, Ser 1629, Cl HA 3.500%, 12/15/21 72 73 FHLMC, Ser 1B1002 (B) 3.686%, 08/01/33 1,175 1,166 FHLMC, Ser 2485, Cl AF 5.500%, 12/15/15 546 564 FHLMC, Ser 2485, Cl AH 5.500%, 12/15/13 26 26 FHLMC, Ser 2497, Cl NM 4.500%, 05/15/14 275 278 FHLMC, Ser 2508, Cl MF 5.000%, 04/15/13 610 619 FHLMC, Ser 2542, Cl AG 4.000%, 11/15/11 1,016 1,024 FHLMC, Ser 2558, Cl BA 5.000%, 05/15/11 546 553 FHLMC, Ser 2572, Cl LB 5.000%, 04/15/16 1,000 1,024 FHLMC, Ser 2595, Cl AB 5.000%, 02/15/14 971 996 FHLMC, Ser 2685, Cl NA 4.000%, 11/15/06 679 686 34 - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ U.S. GOVERNMENT AGENCY MORTGAGE-BACKED OBLIGATIONS--CONTINUED FHLMC, Ser 780675 (B) 3.352%, 07/01/33 $1,170 $ 1,175 FHLMC, Ser 847259 (B) 4.359%, 03/01/34 1,150 1,154 FHLMC, Ser M80812 4.500%, 04/01/10 1,270 1,269 FHLMC, Ser M90803 4.500%, 03/01/08 1,332 1,349 FHLMC, Ser M90814 4.000%, 05/01/08 1,757 1,757 FHLMC, Ser M90818 4.000%, 06/01/08 753 753 FNMA, Ser 1993-197, Cl PH 6.000%, 07/25/08 772 785 FNMA, Ser 1993-43, Cl H 6.500%, 12/25/07 106 107 FNMA, Ser 2001-80, Cl PC 5.250%, 09/25/23 610 612 FNMA, Ser 2003-21, Cl XA 4.500%, 05/25/18 519 520 FNMA, Ser 2003-9, Cl UA 4.000%, 11/25/16 1,750 1,772 FNMA, Ser 555817 (B) 3.135%, 09/01/33 995 1,012 FNMA, Ser 555844 (B) 3.108%, 10/01/33 1,188 1,230 FNMA, Ser 635082 (B) 5.128%, 05/01/32 1,021 1,055 FNMA, Ser 688988 (B) 3.195%, 05/01/33 1,172 1,172 FNMA, Ser 701045 (B) 3.473%, 04/01/33 1,619 1,624 FNMA, Ser 709050 (B) 3.781%, 06/01/33 2,196 2,192 FNMA, Ser 722615 (B) 3.703%, 08/01/33 1,149 1,143 - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ U.S. GOVERNMENT AGENCY MORTGAGE-BACKED OBLIGATIONS--CONTINUED FNMA, Ser 2002-75, Cl QJ 3.250%, 11/25/32 $ 628 $ 630 FNMA, Ser 759258 (B) 3.372%, 01/01/34 652 653 FNMA, Ser 772346 (B) 4.360%, 03/01/34 1,164 1,166 GNMA, Ser 2003-75, Cl YM 4.000%, 10/20/21 389 393 -------- Total U.S. Government Agency Mortgage-Backed Obligations (Cost $31,230) 31,133 -------- ASSET-BACKED SECURITIES (7.6%) Collegiate Funding Services Education Loan, Ser 2003-B, Cl A6 (B) 1.200%, 12/28/43 1,200 1,200 Education Funding Capital Trust I, Ser 2003-A1, Cl 8 (B) 1.140%, 06/01/42 1,150 1,150 Education Loans, Ser 2003-1, Cl A (B) 1.250%, 12/01/35 1,200 1,200 Nelnet Student Loan Corporation, Ser 2002-A, Cl A7 (B) 1.100%, 06/01/35 1,200 1,200 SLM Student Loan Trust, Ser 2003-11, Cl A1 (B) 1.110%, 09/15/09 1,072 1,072 SLM Student Loan Trust, Ser 2004-2, Cl A2 (B) 1.190%, 04/25/13 1,750 1,749 Student Loan Financial Association, Ser 2003-04, Cl A (B) 1.200%, 12/01/38 1,200 1,200 -------- Total Asset-Backed Securities (Cost $8,773) 8,771 -------- 35 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 CLASSIC INSTITUTIONAL U.S. GOVERNMENT SECURITIES SUPER SHORT INCOME PLUS FUND -- CONCLUDED - ------------------------------------------------------------ FACE AMOUNT (000)/SHARES VALUE (000) - ------------------------------------------------------------ MUNICIPAL BOND (1.0%) Student Loan Financial Association Education, RB (B) 1.250%, 06/01/38 $1,200 $ 1,200 -------- Total Municipal Bond (Cost $1,199) 1,200 -------- CASH EQUIVALENTS (2.2%) Dreyfus Government Cash Management Fund 1,250,000 1,250 Federated U.S. Government Fund 1,250,000 1,250 -------- Total Cash Equivalents (Cost $2,500) 2,500 -------- REPURCHASE AGREEMENTS (5.9%) Merrill Lynch 1.020% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $4,503,193 (collateralized by U.S. Government Obligations: total market value $4,592,777) (D) $4,503 4,503 UBS Paine Webber 1.010% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $2,284,865 (collateralized by U.S. Government Obligations: total market value $2,333,249) (D) 2,285 2,285 -------- Total Repurchase Agreements (Cost $6,788) 6,788 -------- Total Investments (100.1%) (Cost $115,746) 115,602 -------- - ------------------------------------------------------------ VALUE (000) - ------------------------------------------------------------ OTHER ASSETS AND LIABILITIES (-0.1%) Investment Advisory Fees Payable $ (12) Administration Fees Payable (7) Distribution Fees Payable (7) Custodian Fees Payable (1) Transfer Agent Shareholder Servicing Fees Payable (1) Other Assets and Liabilities, Net (55) -------- Total Other Assets and Liabilities (83) -------- NET ASSETS: Paid in Capital -- Institutional Shares (unlimited authorization -- no par value) based on 38,705,074 outstanding shares of beneficial interest 77,875 Paid in Capital -- L Shares (unlimited authorization -- no par value) based on 3,841,425 outstanding shares of beneficial interest 38,543 Undistributed net investment income 2 Accumulated net realized loss on investments (757) Net unrealized depreciation on investments (144) -------- Total Net Assets (100.0%) $115,519 ======== Net Asset Value, Offering and Redemption Price Per Share -- Institutional Shares ($77,360,384 / 38,705,074 shares) $2.00 ======== Net Asset Value, Offering and Redemption Price Per Share -- L Shares ($38,158,622 / 3,841,425 shares) $9.93 ======== THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. FOR DESCRIPTIONS OF ABBREVIATIONS AND FOOTNOTES, PLEASE SEE PAGE 45. 36 CLASSIC INSTITUTIONAL CASH MANAGEMENT MONEY MARKET FUND - ----------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - ----------------------------------------------------------- U.S. GOVERNMENT AGENCY OBLIGATIONS (47.2%) FHLB 1.360%, 03/09/05 $30,000 $ 30,000 1.200%, 04/01/05 25,000 24,994 FHLB, Ser RX04 1.141%, 06/09/04 75,000 75,000 FHLB, Ser VF04 1.166%, 09/29/04 50,000 50,000 FHLB, Ser VI04 1.186%, 10/06/04 50,000 50,000 FHLMC 1.875%, 01/15/05 20,000 20,026 FHLMC Discount Note (C) 1.209%, 06/21/04 25,000 24,983 1.225%, 08/12/04 45,000 44,891 1.455%, 11/16/04 25,000 24,831 1.471%, 11/23/04 25,000 24,823 1.078%, 12/06/04 25,000 24,860 FNMA 1.196%, 08/13/04 80,000 80,000 1.030%, 08/23/04 120,000 120,000 1.375%, 02/11/05 55,000 55,000 1.360%, 02/15/05 40,000 40,000 1.050%, 02/23/05 100,000 100,000 FNMA Discount Note (C) 1.212%, 07/01/04 50,000 49,950 1.160%, 08/20/04 50,000 49,851 1.119%, 10/04/04 30,000 29,884 1.416%, 11/03/04 40,000 39,758 1.073%, 11/12/04 30,000 29,820 1.296%, 12/10/04 30,000 29,795 1.295%, 02/04/05 50,000 49,559 FRMMT 1.065%, 02/24/05 50,000 50,000 ---------- Total U.S. Government Agency Obligations (Cost $1,118,025) 1,118,025 ---------- - ----------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - ----------------------------------------------------------- CORPORATE OBLIGATIONS (22.5%) COMMERCIAL BANKS (3.1%) American Express Centurion 1.050%, 01/20/05 $25,000 $ 25,000 Wells Fargo Bank (B) 1.040%, 10/07/04 49,500 49,500 ---------- 74,500 ---------- FINANCE (13.5%) Beta Finance, MTN 1.216%, 09/07/04 (A) (B) 25,000 25,000 1.226%, 01/18/05 50,000 50,000 1.535%, 04/29/05 25,000 24,981 Dorada Finance, MTN 1.216%, 08/13/04 (A) (B) 25,000 25,000 1.226%, 01/14/05 50,000 50,000 1.181%, 03/18/05 20,000 20,000 Liberty Light US Capital, MTN 1.060%, 05/10/05 50,000 49,990 Sigma Finance, MTN 1.206%, 09/01/04 (A) (B) 25,000 24,999 1.226%, 01/12/05 50,000 49,995 ---------- 319,965 ---------- INVESTMENT BANKERS/BROKER DEALERS (2.1%) Bear Stearns, Ser B, MTN (B) 1.070%, 07/19/04 25,000 25,000 Morgan Stanley 1.100%, 05/04/05 25,000 25,000 ---------- 50,000 ---------- SPECIAL PURPOSE ENTITY (3.8%) Barrington Development (B) 1.120%, 12/01/32 21,135 21,135 37 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 CLASSIC INSTITUTIONAL CASH MANAGEMENT MONEY MARKET FUND -- CONTINUED - ----------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - ----------------------------------------------------------- SPECIAL PURPOSE ENTITY--CONTINUED Carmichael Properties (B) 1.150%, 10/01/20 $ 3,070 $ 3,070 Gasmor Corp. & Scientific (B) 1.110%, 02/01/31 3,710 3,710 Principal Life Global, MTN (B) 1.350%, 06/26/04 61,000 61,147 ---------- 89,062 ---------- Total Corporate Obligations (Cost $533,527) 533,527 ---------- TAXABLE MUNICIPAL BONDS (12.8%) Alabaster, Alabama, Ser A, GO, AMBAC (B) 1.110%, 04/01/14 9,355 9,355 Alaska State, Housing Finance Agency, Ser C, RB, MBIA (B) 1.050%, 12/01/32 47,700 47,700 Colorado State, Housing Finance Authority, Ser AA-1, RB (B) 1.090%, 05/01/41 20,025 20,025 Colorado State, Housing Finance Authority, Ser B-2, RB (B) 1.090%, 11/01/33 20,700 20,700 Colorado State, Housing Finance Authority, Ser C-2, RB (B) 1.090%, 05/01/22 10,000 10,000 Colorado State, Housing Finance Authority, Ser I-C-1, RB (B) 1.090%, 11/01/32 35,000 35,000 Florida, Housing Finance, Ser A-2, RB (LOC: FNMA) (B) 1.090%, 01/15/35 2,500 2,500 Illinois State, Student Assistance Community, Ser D, RB (LOC: Bank of America) (B) 1.100%, 09/01/23 40,000 40,000 - ----------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - ----------------------------------------------------------- TAXABLE MUNICIPAL BONDS--CONTINUED LP Pinewood SPV, LLC, Ser 2003 (B) 1.100%, 02/01/18 $14,900 $ 14,900 Mississippi, Development Bank, McEda Building Project, RB, AMBAC (B) 1.100%, 12/01/23 4,200 4,200 New Jersey, Economic Development, Morey Organization Project, RB (LOC: First Union National Bank) (B) 1.150%, 10/01/15 3,340 3,340 New Jersey, Economic Development, Pension Funding (B) 1.090%, 02/15/29 40,000 40,000 New York City, Housing Development, Chelsea Centro Project, RB (LOC: Bayerische Landesbank) (B) 1.100%, 06/01/33 28,200 28,200 Newport News, Virginia, Economic Development Authority, Shipbuilding Project, Ser A, RB (LOC: First Union National Bank) (B) 1.120%, 07/01/31 4,560 4,560 Newport News, Virginia, Economic Development Authority, Shipbuilding Project, Ser B, RB (LOC: First Union National Bank) (B) 1.070%, 07/01/31 22,880 22,880 ---------- Total Taxable Municipal Bonds (Cost $303,360) 303,360 ---------- 38 - ----------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - ----------------------------------------------------------- CERTIFICATES OF DEPOSIT (6.7%) American Express Centurion (B) 1.060%, 09/27/04 $ 30,000 $ 30,000 Branch Banking & Trust 1.105%, 01/24/05 30,000 30,000 Credit Suisse First Boston, Ser YCD (B) 1.075%, 09/20/04 40,000 40,000 First Tennessee Bank, Ser CD (B) 1.060%, 06/30/04 30,000 30,000 Regions Bank, Ser CD (B) 1.050%, 07/29/04 30,000 30,000 ---------- Total Certificates of Deposit (Cost $160,000) 160,000 ---------- COMMERCIAL PAPER (5.0%) ASSET-BACKED (0.8%) Atlantis One Funding (C) 1.066%, 09/09/04 20,000 19,941 ---------- FINANCE (2.9%) Banc of America (C) 1.163%, 06/01/04 67,500 67,500 ---------- INVESTMENT BANKERS/BROKER DEALERS (1.3%) Morgan Stanley 1.110%, 07/27/04 30,000 30,000 ---------- Total Commercial Paper (Cost $117,441) 117,441 ---------- REPURCHASE AGREEMENTS (5.7%) ABN Amro 0.980% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $19,238,778 (collateralized by U.S. Government Obligations: total market value $19,622,192) (D) 19,237 19,237 - ----------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - ----------------------------------------------------------- REPURCHASE AGREEMENTS--CONTINUED Banque Nationale de Paris 0.980% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $30,216,798 (collateralized by U.S. Government Obligations: total market value $30,818,563) (D) $30,214 $ 30,214 Bear Stearns 1.020% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $6,766,820 (collateralized by U.S. Government Obligations: total market value $6,903,567) (D) 6,766 6,766 Lehman Brothers 1.040% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $31,265,629 (collateralized by U.S. Government Obligations: total market value $31,887,447) (D) 31,262 31,262 Merrill Lynch 1.020% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $31,427,703 (collateralized by U.S. Government Obligations: total market value $32,053,020) (D) 31,424 31,424 UBS Paine Webber 1.010% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $16,360,664 (collateralized by U.S. Government Obligations: total market value $16,689,771) (D) 16,359 16,359 ---------- Total Repurchase Agreements (Cost $135,262) 135,262 ---------- Total Investments (99.9%) (Cost $2,367,615) 2,367,615 ---------- 39 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 CLASSIC INSTITUTIONAL CASH MANAGEMENT MONEY MARKET FUND -- CONCLUDED - ----------------------------------------------------------- VALUE (000) - ----------------------------------------------------------- OTHER ASSETS AND LIABILITIES (0.1%) Receivable from Affiliated Funds $ 8 Investment Advisory Fees Payable (342) Administration Fees Payable (97) Transfer Agent Shareholder Servicing Fees Payable (11) Custodian Fees Payable (10) Payable to Adviser (8) Trustees Fees Payable (2) Other Assets and Liabilities, Net 1,696 ---------- Total Other Assets and Liabilities 1,234 ---------- NET ASSETS: Paid in Capital -- Institutional Shares (unlimited authorization -- no par value) based on 2,368,770,436 outstanding shares of beneficial interest 2,368,770 Undistributed net investment income 79 ---------- Total Net Assets (100.0%) $2,368,849 ========== Net Asset Value, Offering and Redemption Price Per Share -- Institutional Shares ($2,368,849,297 / 2,368,770,436 shares) $1.00 ========== THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. FOR DESCRIPTIONS OF ABBREVIATIONS AND FOOTNOTES, PLEASE SEE PAGE 45. 40 CLASSIC INSTITUTIONAL U.S. GOVERNMENT SECURITIES MONEY MARKET FUND - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ U.S. GOVERNMENT AGENCY OBLIGATIONS (87.3%) FFCB (B) 0.980%, 08/24/04 $15,000 $ 14,998 1.254%, 01/27/05 25,000 24,999 1.000%, 01/28/05 30,000 30,000 1.000%, 05/16/05 25,000 24,995 FHLB 1.400%, 04/01/05 10,000 10,000 1.200%, 04/01/05 10,000 9,998 FHLB, Ser 423 (B) 1.249%, 12/17/04 50,000 49,997 FHLB, Ser MF04 (B) 0.985%, 10/12/04 21,400 21,399 FHLB, Ser RX04 (B) 1.234%, 06/09/04 50,000 50,000 FHLB, Ser VF04 (B) 1.259%, 09/29/04 25,000 25,000 FHLB, Ser VI04 (B) 1.279%, 10/06/04 25,000 25,000 FHLB, Ser YP04 (B) 1.259%, 12/15/04 25,000 25,000 FHLMC Discount Note (C) 1.210%, 06/21/04 15,000 14,990 1.471%, 11/23/04 10,000 9,929 FHLMC, Ser 3, MTN 1.520%, 12/24/04 15,000 15,000 FNMA 1.289%, 08/13/04 (B) 35,000 35,000 1.050%, 08/23/04 (B) 40,000 40,000 1.360%, 02/15/05 10,000 10,000 1.050%, 02/23/05 (B) 50,000 50,000 1.038%, 05/03/05 (B) 25,000 24,995 FNMA Discount Note (C) 1.212%, 07/01/04 10,000 9,990 1.358%, 08/20/04 10,000 9,970 1.273%, 09/01/04 15,000 14,952 1.311%, 09/17/04 10,000 9,964 1.119%, 10/04/04 15,000 14,942 - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ U.S. GOVERNMENT AGENCY OBLIGATIONS--CONTINUED FNMA Discount Note (C)--continued 1.167%, 10/13/04 $15,000 $ 14,935 1.337%, 11/12/04 20,000 19,880 1.316%, 12/10/04 15,000 14,896 1.079%, 12/16/04 10,000 9,941 1.214%, 01/07/05 15,000 14,890 1.413%, 03/04/05 15,000 14,840 1.573%, 04/01/05 10,000 9,869 FRMMT 1.065%, 02/24/05 (B) 30,000 30,000 SLMA (B) 1.219%, 08/19/04 24,000 24,000 1.137%, 10/21/04 25,000 25,000 -------- Total U.S. Government Agency Obligations (Cost $749,369) 749,369 -------- REPURCHASE AGREEMENTS (12.7%) ABN Amro 0.980% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $22,516,801 (collateralized by U.S. Government Obligations: total market value $22,964,823) (D) 22,514 22,514 Banque Nationale de Paris 0.980% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $7,798,094 (collateralized by U.S. Government Obligations: total market value $7,964,060) (D) 7,797 7,797 Bear Stearns 1.020% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $8,974,754 (collateralized by U.S. Government Obligations: total market value $9,154,834) (D) 8,974 8,974 41 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 CLASSIC INSTITUTIONAL U.S. GOVERNMENT SECURITIES MONEY MARKET FUND -- CONCLUDED - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ REPURCHASE AGREEMENTS--CONTINUED Lehman Brothers 1.040% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $22,694,016 (collateralized by U.S. Government Obligations: total market value $23,146,230) (D) $22,691 $ 22,691 Merrill Lynch 1.020% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $25,137,210 (collateralized by U.S. Government Obligations: total market value $25,640,464) (D) 25,134 25,134 Morgan Stanley 1.010% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $8,756,977 (collateralized by U.S. Government Obligations: total market value $8,931,221) (D) 8,756 8,756 UBS Paine Webber 1.010% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $12,690,391 (collateralized by U.S. Government Obligations: total market value $12,946,024) (D) 12,689 12,689 -------- Total Repurchase Agreements (Cost $108,555) 108,555 -------- Total Investments (100.0%) (Cost $857,924) 857,924 -------- - ------------------------------------------------------------ VALUE (000) - ------------------------------------------------------------ OTHER ASSETS AND LIABILITIES (0.0%) Receivable from Affiliated Funds $ 3 Investment Advisory Fees Payable (136) Administration Fees Payable (35) Custodian Fees Payable (4) Transfer Agent Shareholder Servicing Fees Payable (4) Payable to Adviser (3) Trustees Fees Payable (1) Other Assets and Liabilities, Net 516 -------- Total Other Assets and Liabilities 336 -------- NET ASSETS: Paid in Capital -- Institutional Shares (unlimited authorization -- no par value) based on 858,257,432 outstanding shares of beneficial interest 858,257 Undistributed net investment income 3 -------- Total Net Assets (100.0%) $858,260 ======== Net Asset Value, Offering and Redemption Price Per Share -- Institutional Shares ($858,259,924 / 858,257,432 shares) $1.00 ======== THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. FOR DESCRIPTIONS OF ABBREVIATIONS AND FOOTNOTES, PLEASE SEE PAGE 45. 42 SCHEDULE OF INVESTMENTS - -------------------------------------------------------------------------------- CLASSIC INSTITUTIONAL U.S. TREASURY SECURITIES MONEY MARKET FUND - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ U.S. TREASURY OBLIGATIONS (33.5%) U.S. Treasury Bills (C) 0.945%, 06/15/04 $200,000 $ 199,937 0.903%, 06/17/04 240,000 239,904 U.S. Treasury Notes 1.625%, 04/30/05 110,000 110,256 6.750%, 05/15/05 50,000 52,474 ---------- Total U.S. Treasury Obligations (Cost $602,571) 602,571 ---------- REPURCHASE AGREEMENTS (67.8%) ABN Amro 0.960% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $229,602,561 (collateralized by U.S. Treasury Obligations: total market value $234,170,474) (D) 229,578 229,578 Banque Nationale de Paris 0.950% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $83,225,884 (collateralized by U.S. Treasury Obligations: total market value $84,882,009) (D) 83,217 83,217 Bear Stearns 0.930% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $35,366,862 (collateralized by U.S. Treasury Obligations: total market value $36,073,340) (D) 35,363 35,363 Deutsche Bank 0.970% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $86,442,878 (collateralized by U.S. Treasury Obligations: total market value $88,162,875) (D) 86,434 86,434 - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ REPURCHASE AGREEMENTS--CONTINUED Dresdner Bank 0.950% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $75,917,062 (collateralized by U.S. Treasury Obligations: total market value $77,431,500) (D) $ 75,909 $ 75,909 Greenwich Capital 0.960% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $82,383,184 (collateralized by U.S. Treasury Obligations: total market value $84,023,496) (D) 82,374 82,374 JP Morgan Chase 0.950% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $59,763,553 (collateralized by U.S. Treasury Obligations: total market value $60,952,669) (D) 59,757 59,757 Lehman Brothers 0.950% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $86,782,691 (collateralized by U.S. Treasury Obligations: total market value $88,510,492) (D) 86,773 86,773 Merrill Lynch 0.950% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $57,168,603 (collateralized by U.S. Treasury Obligations: total market value $58,306,753) (D) 57,163 57,163 43 SCHEDULE OF INVESTMENTS - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 CLASSIC INSTITUTIONAL U.S. TREASURY SECURITIES MONEY MARKET FUND -- CONCLUDED - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ REPURCHASE AGREEMENTS--CONTINUED Morgan Stanley 0.960% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $62,199,642 (collateralized by U.S. Treasury Obligations: total market value $63,436,921) (D) $ 62,193 $ 62,193 Salomon Smith Barney 0.960% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $73,756,424 (collateralized by U.S. Treasury Obligations: total market value $75,241,627) (D) 73,749 73,749 - ------------------------------------------------------------ FACE AMOUNT (000) VALUE (000) - ------------------------------------------------------------ REPURCHASE AGREEMENTS--CONTINUED UBS Paine Webber 0.970% dated 05/28/04, to be repurchased on 06/01/04, repurchase price $287,441,544 (collateralized by U.S. Treasury Obligations: total market value $293,162,832) (D) $287,411 $ 287,411 ---------- Total Repurchase Agreements (Cost $1,219,921) 1,219,921 ---------- Total Investments (101.3%) (Cost $1,822,492) $1,822,492 ========== PERCENTAGES ARE BASED ON NET ASSETS OF $1,799,499. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. FOR DESCRIPTIONS OF ABBREVIATIONS AND FOOTNOTES, PLEASE SEE PAGE 45. 44 - -------------------------------------------------------------------------------- KEY TO ABBREVIATIONS AND FOOTNOTES USED IN THE STATEMENTS OF NET ASSETS/SCHEDULE OF INVESTMENTS AMBAC American Municipal Bond Assurance Corporation Cl Class FFCB Federal Farm Credit Bank FHLB Federal Home Loan Bank FHLMC Federal Home Loan Mortgage Corporation FNMA Federal National Mortgage Association FRMMT Farmer Mac Medium Term Note GNMA Government National Mortgage Association GO General Obligation LLC Limited Liability Company LOC Letter of Credit LP Limited Partnership MBIA Security insured by the Municipal Bond Insurance Association MTN Medium Term Note PLC Public Limited Company RB Revenue Bond Ser Series SLMA Student Loan Marketing Association (A) Securities sold within terms of a private placement memorandum, exempt from registration under section 144a of the Securities Act of 1933, as amended, and may be sold only to dealers in that program or other "accredited investors." (B) Adjustable Rate Security. The rate reported on the Statement of Net Assets is the rate in effect on May 31, 2004. Demand and interest rate reset features give these securities a shorter effective maturity date. (C) Rate shown is the effective yield at the date of purchase. (D) Tri-Party Repurchase Agreement (E) This security or a partial position of this security is on loan at May 31, 2004 (See Note 8 in the Notes to Financial Statements). The total value of securities on loan at May 31, 2004 was $1,752,554 for the Institutional Short-Term Bond Fund. (F) This security was purchased with cash collateral held from securities lending (See Note 8 in the Notes to Financial Statements). 45 This page intentionally left blank STATEMENT OF ASSETS & LIABILITIES (000) - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004
CLASSIC INSTITUTIONAL U.S. TREASURY SECURITIES MONEY MARKET FUND ---------------- Assets: Investments, Excluding Repurchase Agreements, at Market Value (Cost $602,571) ......... $ 602,571 Repurchase Agreements at Market Value (Cost $1,219,921) ............................... 1,219,921 Receivable for Investment Securities Sold ............................................. 175,000 Interest Receivable ................................................................... 4,173 Prepaid Expenses ...................................................................... 54 Receivable from Affiliated Funds ...................................................... 5 ---------- Total Assets .......................................................................... 2,001,724 ---------- Liabilities: Payable for Investment Securities Purchased ........................................... 200,878 Income Distribution Payable ........................................................... 639 Investment Advisory Fees Payable ...................................................... 286 Shareholder Service Fees Payable - Corporate Trust Shares ............................. 238 Administration Fees Payable ........................................................... 75 Custodian Fees Payable ................................................................ 8 Transfer Agent Shareholder Servicing Fees Payable ..................................... 8 Payable to Adviser .................................................................... 5 Trustees' Fees Payable ................................................................ 1 Accrued Expenses ...................................................................... 87 ---------- Total Liabilities ..................................................................... 202,225 ---------- Total Net Assets ...................................................................... $1,799,499 ========== Net Assets: Paid in Capital - Institutional Shares (unlimited authorization - no par value) based on 420,731,323 outstanding shares of beneficial interest ...................... $ 420,731 Paid in Capital - Corporate Trust Shares (unlimited authorization - no par value) based on 1,378,031,196 outstanding shares of beneficial interest .................... 1,378,031 Distributions in excess of net investment income ...................................... (5) Accumulated net realized gain on investments .......................................... 742 ---------- Total Net Assets ...................................................................... $1,799,499 ========== Net Asset Value, Offering and Redemption Price Per Share - Institutional Shares ($420,948,291 / 420,731,323 shares) ................................................. $1.00 ========== Net Asset Value, Offering and Redemption Price Per Share - Corporate Trust Shares ($1,378,551,144 / 1,378,031,196 shares) ............................................. $1.00 ========== THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
47 STATEMENTS OF OPERATIONS (000) - -------------------------------------------------------------------------------- STI CLASSIC FUNDS FOR THE YEAR OR PERIOD ENDED MAY 31, 2004
CLASSIC CLASSIC CLASSIC INSTITUTIONAL CLASSIC INSTITUTIONAL INSTITUTIONAL SUPER SHORT INSTITUTIONAL HIGH QUALITY SHORT-TERM INCOME TOTAL RETURN BOND FUND (1) BOND FUND PLUS FUND BOND FUND (2) ----------- ------------ ----------- ------------- Income: Interest Income ............................... $ 1,389 $ 640 $ 4,833 $ 660 Dividend Income ............................... 26 7 74 34 Income from Securities Lending ................ -- 2 5 -- -------- -------- -------- -------- Total Income .................................. 1,415 649 4,912 694 -------- -------- -------- -------- Expenses: Investment Advisory Fees ...................... 252 162 1,355 86 Administration Fees ........................... 35 19 186 13 Shareholder Service Fees - Institutional Shares ........................ 31 68 360 16 Shareholder Service Fees - Corporate Trust Shares ...................... -- -- -- -- Shareholder Service Fees - T Shares ........... 152 -- 317 39 Custodian Fees ................................ 1 1 6 -- Distribution Fees - L Shares .................. -- -- -- -- Transfer Agent Shareholder Servicing Fees ..... 1 1 7 -- Transfer Agent Fees - Institutional Shares .... 8 16 16 8 Transfer Agent Fees - Corporate Trust Shares ...................... -- -- -- -- Transfer Agent Fees - T Shares ................ 7 -- 16 7 Transfer Agent Fees - L Shares ................ -- -- -- -- Transfer Agent Out of Pocket Expenses ......... 2 1 9 1 Offering Costs ................................ 12 -- -- 13 Professional Fees ............................. 4 1 12 2 Printing Fees ................................. 2 1 10 1 Trustee Fees .................................. 1 -- 3 -- Registration Fees ............................. -- 1 11 -- Insurance and Other Fees ...................... 2 1 18 1 -------- -------- -------- -------- Total Expenses ................................ 510 272 2,326 187 -------- -------- -------- -------- Less: Investment Advisory Fees Waived ......... (57) (68) (812) (29) Administration Fees Waived ................ -- -- -- -- Shareholder Service Fees Waived - Institutional Shares .................... (20) (68) (360) (16) Shareholder Service Fees Waived - T Shares ................................ (41) -- (63) (17) Distribution Fees Waived - L Shares ....... -- -- -- -- -------- -------- -------- -------- Net Expenses .................................. 392 136 1,091 125 -------- -------- -------- -------- Net Investment Income ......................... 1,023 513 3,821 569 -------- -------- -------- -------- Net Realized Gain (Loss) on Investments Sold .. 197 91 (460) (186) Net Change in Unrealized Depreciation on Investments ................. (2,882) (557) (1,377) (1,485) -------- -------- -------- -------- Net Increase (Decrease) in Net Assets Resulting from Operations ............................. $ (1,662) $ 47 $ 1,984 $ (1,102) ======== ======== ======== ========
CLASSIC INSTITUTIONAL CLASSIC CLASSIC CLASSIC U.S. GOVERNMENT INSTITUTIONAL INSTITUTIONAL INSTITUTIONAL SECURITIES SUPER CASH MANAGEMENT U.S. GOVERNMENT U.S. TREASURY SHORT INCOME MONEY MARKET SECURITIES MONEY SECURITIES MONEY PLUS FUND FUND MARKET FUND MARKET FUND ---------------- --------------- ---------------- ---------------- Income: Interest Income ............................... $ 1,948 $ 30,109 $ 10,632 $ 19,313 Dividend Income ............................... 41 583 -- 69 Income from Securities Lending ................ 1 -- -- -- -------- -------- -------- -------- Total Income .................................. 1,990 30,692 10,632 19,382 -------- -------- -------- -------- Expenses: Investment Advisory Fees ...................... 537 5,543 1,967 3,982 Administration Fees ........................... 92 1,899 674 1,364 Shareholder Service Fees - Institutional Shares ........................ 224 -- -- -- Shareholder Service Fees - Corporate Trust Shares ...................... -- -- -- 2,947 Shareholder Service Fees - T Shares ........... -- -- -- -- Custodian Fees ................................ 3 65 24 50 Distribution Fees - L Shares .................. 177 -- -- -- Transfer Agent Shareholder Servicing Fees ..... 4 74 26 53 Transfer Agent Fees - Institutional Shares .... 16 16 16 16 Transfer Agent Fees - Corporate Trust Shares ...................... -- -- -- 16 Transfer Agent Fees - T Shares ................ -- -- -- -- Transfer Agent Fees - L Shares ................ 17 -- -- -- Transfer Agent Out of Pocket Expenses ......... 4 91 33 66 Offering Costs ................................ -- -- -- -- Professional Fees ............................. 6 104 39 78 Printing Fees ................................. 5 84 31 63 Trustee Fees .................................. 1 29 10 21 Registration Fees ............................. 5 101 35 63 Insurance and Other Fees ...................... 11 66 17 57 -------- -------- -------- -------- Total Expenses ................................ 1,102 8,072 2,872 8,776 -------- -------- -------- -------- Less: Investment Advisory Fees Waived ......... (375) (740) (84) (274) Administration Fees Waived ................ -- (321) (170) (329) Shareholder Service Fees Waived - Institutional Shares .................... (224) -- -- -- Shareholder Service Fees Waived - T Shares ................................ -- -- -- -- Distribution Fees Waived - L Shares ....... (82) -- -- -- -------- -------- -------- -------- Net Expenses .................................. 421 7,011 2,618 8,173 -------- -------- -------- -------- Net Investment Income ......................... 1,569 23,681 8,014 11,209 -------- -------- -------- -------- Net Realized Gain (Loss) on Investments Sold .. (257) 81 3 1,300 Net Change in Unrealized Depreciation on Investments ................. (560) -- -- -- -------- -------- -------- -------- Net Increase (Decrease) in Net Assets Resulting from Operations ............................. $ 752 $ 23,762 $ 8,017 $ 12,509 ======== ======== ======== ======== (1) Commenced operations on October 27, 2003. (2) Commenced operations on October 15, 2003. Amounts designated as "--" are either $0 or have been rounded to $0.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. 48 - 49 STATEMENTS OF CHANGES IN NET ASSETS (000) - -------------------------------------------------------------------------------- STI CLASSIC FUNDS FOR THE YEARS OR PERIODS ENDED MAY 31,
CLASSIC INSTITUTIONAL CLASSIC INSTITUTIONAL CLASSIC INSTITUTIONAL SUPER SHORT HIGH QUALITY BOND FUND SHORT-TERM BOND FUND INCOME PLUS FUND ---------------------- ------------------------- ------------------------- 10/27/03*- 06/01/03- 06/01/02- 06/01/03- 06/01/02- 05/31/04 05/31/04 05/31/03 05/31/04 05/31/03 ----------- ----------- ----------- ----------- ----------- Operations: Net Investment Income ...................... $ 1,023 $ 513 $ 450 $ 3,821 $ 1,924 Net Realized Gain (Loss) on Investments Sold 197 91 392 (460) 73 Net Change in Unrealized Appreciation (Depreciation) on Investments ............ (2,882) (557) 291 (1,377) 929 ----------- ----------- ----------- ----------- ----------- Increase (Decrease) in Net Assets Resulting from Operations .......................... (1,662) 47 1,133 1,984 2,926 ----------- ----------- ----------- ----------- ----------- Dividends and Distributions to Shareholders: Net Investment Income: Institutional Shares ..................... (267) (512) (450) (2,161) (1,869) Corporate Trust Shares ................... -- -- -- -- -- T Shares ................................. (789) -- -- (1,656) (264) L Shares ................................. -- -- -- -- -- Capital Gains: Institutional Shares ..................... -- (159) (268) -- (14) Corporate Trust Shares ................... -- -- -- -- -- T Shares ................................. -- -- -- -- (1) ----------- ----------- ----------- ----------- ----------- Total Dividends and Distributions ........ (1,056) (671) (718) (3,817) (2,148) ----------- ----------- ----------- ----------- ----------- Capital Transactions (1): Institutional Shares: Proceeds from Shares Issued .............. 26,414 24,777 11,283 155,867 190,846 Reinvestment of Cash Distributions ....... 147 401 450 493 125 Cost of Shares Repurchased ............... (674) (9,722) (7,547) (189,463) (78,814) ----------- ----------- ----------- ----------- ----------- Increase (Decrease) in Net Assets from Institutional Share Transactions .... 25,887 15,456 4,186 (33,103) 112,157 ----------- ----------- ----------- ----------- ----------- Corporate Trust Shares: Proceeds from Shares Issued .............. -- -- -- -- -- Reinvestment of Cash Distributions ....... -- -- -- -- -- Cost of Shares Repurchased ............... -- -- -- -- -- ----------- ----------- ----------- ----------- ----------- Increase (Decrease) in Net Assets from Corporate Trust Share Transactions .. -- -- -- -- -- ----------- ----------- ----------- ----------- ----------- T Shares (2): Proceeds from Shares Issued .............. 116,614 -- -- 150,211 76,338 Reinvestment of Cash Distributions ....... 82 -- -- 210 35 Cost of Shares Repurchased ............... (5,577) -- -- (82,032) (6,651) ----------- ----------- ----------- ----------- ----------- Increase in Net Assets from T Share Transactions ................ 111,119 -- -- 68,389 69,722 ----------- ----------- ----------- ----------- ----------- L Shares (3): Proceeds from Shares Issued .............. -- -- -- -- -- Reinvestment of Cash Distributions ....... -- -- -- -- -- Cost of Shares Repurchased ............... -- -- -- -- -- ----------- ----------- ----------- ----------- ----------- Increase in Net Assets from L Share Transactions ................ -- -- -- -- -- ----------- ----------- ----------- ----------- ----------- Increase (Decrease) in Net Assets from Share Transactions ................ 137,006 15,456 4,186 35,286 181,879 ----------- ----------- ----------- ----------- ----------- Total Increase (Decrease) in Net Assets 134,288 14,832 4,601 33,453 182,657 ----------- ----------- ----------- ----------- ----------- Net Assets: Beginning of Period ...................... -- 20,777 16,176 216,387 33,730 ----------- ----------- ----------- ----------- ----------- End of Period ............................ $ 134,288 $ 35,609 $ 20,777 $ 249,840 $ 216,387 =========== =========== =========== =========== =========== Undistributed (Distributions in Excess of) Net Investment Income .................... $ 3 $ 1 $ -- $ -- $ (4) =========== =========== =========== =========== ===========
CLASSIC INSTITUTIONAL CLASSIC INSTITUTIONAL U.S. GOVERNMENT TOTAL RETURN SECURITIES SUPER SHORT BOND FUND INCOME PLUS FUND --------------------- ------------------------------------- 10/15/03*- 06/01/03- 06/01/02- 05/31/04 05/31/04 05/31/03 ----------- ----------- ----------- Operations: Net Investment Income ...................... $ 569 $ 1,569 $ 1,239 Net Realized Gain (Loss) on Investments Sold (186) (257) 192 Net Change in Unrealized Appreciation (Depreciation) on Investments ............ (1,485) (560) 356 ----------- ----------- ----------- Increase (Decrease) in Net Assets Resulting from Operations .......................... (1,102) 752 1,787 ----------- ----------- ----------- Dividends and Distributions to Shareholders: Net Investment Income: Institutional Shares ..................... (255) (1,347) (1,504) Corporate Trust Shares ................... -- -- -- T Shares ................................. (352) -- -- L Shares ................................. -- (559) (16) Capital Gains: Institutional Shares ..................... -- -- (61) Corporate Trust Shares ................... -- -- -- T Shares ................................. -- -- -- ----------- ----------- ----------- Total Dividends and Distributions ........ (607) (1,906) (1,581) ----------- ----------- ----------- Capital Transactions (1): Institutional Shares: Proceeds from Shares Issued .............. 18,136 62,017 123,870 Reinvestment of Cash Distributions ....... 225 596 919 Cost of Shares Repurchased ............... (2,376) (79,764) (57,852) ----------- ----------- ----------- Increase (Decrease) in Net Assets from Institutional Share Transactions .... 15,985 (17,151) 66,937 ----------- ----------- ----------- Corporate Trust Shares: Proceeds from Shares Issued .............. -- -- -- Reinvestment of Cash Distributions ....... -- -- -- Cost of Shares Repurchased ............... -- -- -- ----------- ----------- ----------- Increase (Decrease) in Net Assets from Corporate Trust Share Transactions .. -- -- -- ----------- ----------- ----------- T Shares (2): Proceeds from Shares Issued .............. 34,463 -- -- Reinvestment of Cash Distributions ....... 352 -- -- Cost of Shares Repurchased ............... (1,601) -- -- ----------- ----------- ----------- Increase in Net Assets from T Share Transactions ................ 33,214 -- -- ----------- ----------- ----------- L Shares (3): Proceeds from Shares Issued .............. -- 85,370 25,108 Reinvestment of Cash Distributions ....... -- 480 14 Cost of Shares Repurchased ............... -- (71,061) (1,368) ----------- ----------- ----------- Increase in Net Assets from L Share Transactions ................ -- 14,789 23,754 ----------- ----------- ----------- Increase (Decrease) in Net Assets from Share Transactions ................ 49,199 (2,362) 90,691 ----------- ----------- ----------- Total Increase (Decrease) in Net Assets 47,490 (3,516) 90,897 ----------- ----------- ----------- Net Assets: Beginning of Period ...................... -- 119,035 28,138 ----------- ----------- ----------- End of Period ............................ $ 47,490 $ 115,519 $ 119,035 =========== =========== =========== Undistributed (Distributions in Excess of) Net Investment Income .................... $ -- $ 2 $ (3) =========== =========== ===========
CLASSIC INSTITUTIONAL CLASSIC INSTITUTIONAL CASH MANAGEMENT U.S. GOVERNMENT MONEY MARKET FUND SECURITIES MONEY MARKET FUND ------------------------- ---------------------------- 06/01/03- 06/01/02- 06/01/03- 06/01/02- 05/31/04 05/31/03 05/31/04 05/31/03 ----------- ----------- ----------- ----------- Operations: Net Investment Income ...................... $ 23,681 $ 45,953 $ 8,014 $ 14,586 Net Realized Gain (Loss) on Investments Sold 81 13 3 -- Net Change in Unrealized Appreciation (Depreciation) on Investments ............ -- -- -- -- ----------- ----------- ----------- ----------- Increase (Decrease) in Net Assets Resulting from Operations .......................... 23,762 45,966 8,017 14,586 ----------- ----------- ----------- ----------- Dividends and Distributions to Shareholders: Net Investment Income: Institutional Shares ..................... (23,681) (45,956) (8,014) (14,586) Corporate Trust Shares ................... -- -- -- -- T Shares ................................. -- -- -- -- L Shares ................................. -- -- -- -- Capital Gains: Institutional Shares ..................... (15) -- -- -- Corporate Trust Shares ................... -- -- -- -- T Shares ................................. -- -- -- -- ----------- ----------- ----------- ----------- Total Dividends and Distributions ........ (23,696) (45,956) (8,014) (14,586) ----------- ----------- ----------- ----------- Capital Transactions (1): Institutional Shares: Proceeds from Shares Issued .............. 7,415,918 8,275,886 2,512,598 2,229,173 Reinvestment of Cash Distributions ....... 14,226 28,135 2,820 4,993 Cost of Shares Repurchased ............... (8,047,111) (8,727,887) (2,697,227) (2,219,814) ----------- ----------- ----------- ----------- Increase (Decrease) in Net Assets from Institutional Share Transactions .... (616,967) (423,866) (181,809) 14,352 ----------- ----------- ----------- ----------- Corporate Trust Shares: Proceeds from Shares Issued .............. -- -- -- -- Reinvestment of Cash Distributions ....... -- -- -- -- Cost of Shares Repurchased ............... -- -- -- -- ----------- ----------- ----------- ----------- Increase (Decrease) in Net Assets from Corporate Trust Share Transactions .. -- -- -- -- ----------- ----------- ----------- ----------- T Shares (2): Proceeds from Shares Issued .............. -- -- -- -- Reinvestment of Cash Distributions ....... -- -- -- -- Cost of Shares Repurchased ............... -- -- -- -- ----------- ----------- ----------- ----------- Increase in Net Assets from T Share Transactions ................ -- -- -- -- ----------- ----------- ----------- ----------- L Shares (3): Proceeds from Shares Issued .............. -- -- -- -- Reinvestment of Cash Distributions ....... -- -- -- -- Cost of Shares Repurchased ............... -- -- -- -- ----------- ----------- ----------- ----------- Increase in Net Assets from L Share Transactions ................ -- -- -- -- ----------- ----------- ----------- ----------- Increase (Decrease) in Net Assets from Share Transactions ................ (616,967) (423,866) (181,809) 14,352 ----------- ----------- ----------- ----------- Total Increase (Decrease) in Net Assets (616,901) (423,856) (181,806) 14,352 ----------- ----------- ----------- ----------- Net Assets: Beginning of Period ...................... 2,985,750 3,409,606 1,040,066 1,025,714 ----------- ----------- ----------- ----------- End of Period ............................ $ 2,368,849 $ 2,985,750 $ 858,260 $ 1,040,066 =========== =========== =========== =========== Undistributed (Distributions in Excess of) Net Investment Income .................... $ 79 $ -- $ 3 $ -- =========== =========== =========== ===========
CLASSIC INSTITUTIONAL U.S. TREASURY SECURITIES MONEY MARKET FUND ---------------------------- 06/01/03- 06/01/02- 05/31/04 05/31/03 ----------- ----------- Operations: Net Investment Income ...................... $ 11,209 $ 22,122 Net Realized Gain (Loss) on Investments Sold 1,300 900 Net Change in Unrealized Appreciation (Depreciation) on Investments ............ -- -- ----------- ----------- Increase (Decrease) in Net Assets Resulting from Operations .......................... 12,509 23,022 ----------- ----------- Dividends and Distributions to Shareholders: Net Investment Income: Institutional Shares ..................... (3,696) (6,751) Corporate Trust Shares ................... (7,522) (15,371) T Shares ................................. -- -- L Shares ................................. -- -- Capital Gains: Institutional Shares ..................... (280) (290) Corporate Trust Shares ................... (903) (844) T Shares ................................. -- -- ----------- ----------- Total Dividends and Distributions ........ (12,401) (23,256) ----------- ----------- Capital Transactions (1): Institutional Shares: Proceeds from Shares Issued .............. 3,003,944 3,267,354 Reinvestment of Cash Distributions ....... 2,922 5,216 Cost of Shares Repurchased ............... (3,239,309) (3,170,785) ----------- ----------- Increase (Decrease) in Net Assets from Institutional Share Transactions .... (232,443) 101,785 ----------- ----------- Corporate Trust Shares: Proceeds from Shares Issued .............. 3,290,925 3,516,733 Reinvestment of Cash Distributions ....... -- -- Cost of Shares Repurchased ............... (3,211,341) (4,022,699) ----------- ----------- Increase (Decrease) in Net Assets from Corporate Trust Share Transactions .. 79,584 (505,966) ----------- ----------- T Shares (2): Proceeds from Shares Issued .............. -- -- Reinvestment of Cash Distributions ....... -- -- Cost of Shares Repurchased ............... -- -- ----------- ----------- Increase in Net Assets from T Share Transactions ................ -- -- ----------- ----------- L Shares (3): Proceeds from Shares Issued .............. -- -- Reinvestment of Cash Distributions ....... -- -- Cost of Shares Repurchased ............... -- -- ----------- ----------- Increase in Net Assets from L Share Transactions ................ -- -- ----------- ----------- Increase (Decrease) in Net Assets from Share Transactions ................ (152,859) (404,181) ----------- ----------- Total Increase (Decrease) in Net Assets (152,751) (404,415) ----------- ----------- Net Assets: Beginning of Period ...................... 1,952,250 2,356,665 ----------- ----------- End of Period ............................ $ 1,799,499 $ 1,952,250 =========== =========== Undistributed (Distributions in Excess of) Net Investment Income .................... $ (5) $ 4 =========== =========== * Commencement of Operations. (1) See Note 6 in the Notes to Financial Statements for additional information. (2) The STI Classic Institutional High Quality Bond Fund T Shares commenced operations on November 13, 2003. The STI Classic Institutional Super Short Income Plus Fund T Shares commenced operations on October 3, 2002. The STI Classic Institutional Total Return Bond Fund T Shares commenced operations on January 14, 2004. (3) The STI Classic Institutional U.S. Government Securities Super Short Income Plus Fund L Shares commenced operations on April 16, 2003. Amounts designated as "--" are either $0 or have been rounded to $0.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. 50 - 51 FINANCIAL HIGHLIGHTS - -------------------------------------------------------------------------------- STI CLASSIC FUNDS FOR THE PERIODS ENDED MAY 31, FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
NET ASSET NET REALIZED DIVIDENDS DISTRIBUTIONS VALUE, NET AND UNREALIZED FROM FROM TOTAL NET ASSET BEGINNING OF INVESTMENT GAINS (LOSSES) TOTAL FROM NET INVESTMENT REALIZED DIVIDENDS AND VALUE, END PERIOD INCOME ON INVESTMENTS OPERATIONS INCOME CAPITAL GAINS DISTRIBUTIONS OF PERIOD ------------ ---------- -------------- -------------- ---------- ------------- ------------- ---------- CLASSIC INSTITUTIONAL HIGH QUALITY BOND FUND Institutional Shares 2004 (A) $10.00 $0.12++ $(0.16)++ $(0.04) $(0.12) $ -- $(0.12) $ 9.84 T Shares 2004 (B) $10.00 $0.11++ $(0.16)++ $(0.05) $(0.11) $ -- $(0.11) $ 9.84 CLASSIC INSTITUTIONAL SHORT-TERM BOND FUND Institutional Shares 2004 $10.24 $0.19++ $(0.15)++ $ 0.04 $(0.19) $(0.07) $(0.26) $10.02 2003 10.03 0.24 0.36 0.60 (0.24) (0.15) (0.39) 10.24 2002 (C) 10.00 0.01 0.03 0.04 (0.01) -- (0.01) 10.03 CLASSIC INSTITUTIONAL SUPER SHORT INCOME PLUS FUND Institutional Shares 2004 $ 2.02 $0.03++ $(0.01)++ $ 0.02 $(0.03) $ -- $(0.03) $ 2.01 2003 2.00 0.04 0.02 0.06 (0.04) --* (0.04) 2.02 2002 (D) 2.00 0.01 -- 0.01 (0.01) -- (0.01) 2.00 T Shares 2004 $ 2.01 $0.03++ $(0.01)++ $ 0.02 $(0.03) $ -- $(0.03) $ 2.00 2003 (E) 2.02 0.02 (0.01) 0.01 (0.02) --* (0.02) 2.01 CLASSIC INSTITUTIONAL TOTAL RETURN BOND FUND Institutional Shares 2004 (F) $10.00 $0.19++ $(0.18)++ $ 0.01 $(0.20) $ -- $(0.20) $ 9.81 T Shares 2004 (G) $10.20 $0.11++ $(0.38)++ $(0.27) $(0.12) $ -- $(0.12) $ 9.81 CLASSIC INSTITUTIONAL U.S. GOVERNMENT SECURITIES SUPER SHORT INCOME PLUS FUND Institutional Shares 2004 $ 2.01 $0.03++ $(0.01)++ $ 0.02 $(0.03) $ -- $(0.03) $ 2.00 2003 2.00 0.04 0.01 0.05 (0.04) --* (0.04) 2.01 2002 (H) 2.00 0.01 -- 0.01 (0.01) -- (0.01) 2.00 L Shares 2004 $10.01 $0.10++ $(0.05)++ $ 0.05 $(0.13) $ -- $(0.13) $ 9.93 2003 (I) 10.00 0.02 0.01 0.03 (0.02) -- (0.02) 10.01
RATIO OF RATIO OF NET ASSETS, RATIO OF NET NET INVESTMENT EXPENSES TO PORTFOLIO TOTAL END OF EXPENSES TO INCOME TO AVERAGE NET ASSETS TURNOVER RETURN+ PERIOD (000) AVERAGE NET ASSETS AVERAGE NET ASSETS (EXCLUDING WAIVERS) RATE ------- ------------ ------------------ ------------------ ------------------- -------- CLASSIC INSTITUTIONAL HIGH QUALITY BOND FUND Institutional Shares 2004 (A) (0.37)% $ 25,506 0.65% 2.09% 0.92% 31% T Shares 2004 (B) (0.52)% $108,782 0.82% 2.00% 1.04% 31% CLASSIC INSTITUTIONAL SHORT-TERM BOND FUND Institutional Shares 2004 0.48% $ 35,609 0.50% 1.90% 1.00% 70% 2003 6.08 20,777 0.52 2.32 1.02 146 2002 (C) 0.41 16,176 0.57 2.60 1.07 -- CLASSIC INSTITUTIONAL SUPER SHORT INCOME PLUS FUND Institutional Shares 2004 1.01% $112,453 0.31% 1.50% 0.86% 83% 2003 3.16 146,590 0.31 1.84 0.86 56 2002 (D) 0.30 33,730 0.36 2.44 0.91 30 T Shares 2004 0.81% $137,387 0.51% 1.31% 0.86% 83% 2003 (E) 0.64 69,797 0.57 1.43 0.92 56 CLASSIC INSTITUTIONAL TOTAL RETURN BOND FUND Institutional Shares 2004 (F) 0.03% $ 15,553 0.56% 3.05% 0.90% 121% T Shares 2004 (G) (2.69)% $ 31,937 0.72% 2.96% 1.03% 121% CLASSIC INSTITUTIONAL U.S. GOVERNMENT SECURITIES SUPER SHORT INCOME PLUS FUND Institutional Shares 2004 1.01% $ 77,360 0.24% 1.25% 0.77% 109% 2003 2.80 95,277 0.23 1.76 0.76 87 2002 (H) 0.32 28,138 0.30 2.42 0.83 34 L Shares 2004 0.47% $ 38,159 0.47% 1.01% 0.94% 109% 2003 (I) 0.27 23,758 0.47 0.99 1.06 87 + Returns are for the period indicated and have not been annualized. ++ Per share data calculated using average shares method. * Amount represents less than $0.01 per share. (A) Commenced operations on October 27, 2003. All ratios have been annualized. (B) Commenced operations on November 13, 2003. All ratios have been annualized. (C) Commenced operations on May 14, 2002. All ratios have been annualized. (D) Commenced operations on April 15, 2002. All ratios have been annualized. (E) Commenced operations on October 3, 2002. All ratios have been annualized. (F) Commenced operations on October 15, 2003. All ratios have been annualized. (G) Commenced operations on January 14, 2004. All ratios have been annualized. (H) Commenced operations on April 11, 2002. All ratios have been annualized. (I) Commenced operations on April 16, 2003. All ratios have been annualized. Amounts designated as "--" are either $0 or have been rounded to $0.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. 52 - 53 FINANCIAL HIGHLIGHTS - -------------------------------------------------------------------------------- STI CLASSIC FUNDS FOR THE PERIODS ENDED MAY 31, FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
DISTRIBUTIONS TOTAL NET NET REALIZED FROM DIVIDENDS NET ASSET VALUE, INVESTMENT GAIN (LOSS) TOTAL FROM DIVIDENDS FROM REALIZED AND BEGINNING OF PERIOD INCOME ON INVESTMENTS OPERATIONS NET INVESTMENT INCOME CAPITAL GAINS DISTRIBUTIONS ------------------- ---------- -------------- ---------- --------------------- ------------- ------------- CLASSIC INSTITUTIONAL CASH MANAGEMENT MONEY MARKET FUND Institutional Shares 2004 $1.00 $0.01 $-- $0.01 $(0.01) $--* $(0.01) 2003 1.00 0.01 -- 0.01 (0.01) -- (0.01) 2002 1.00 0.03 -- 0.03 (0.03) -- (0.03) 2001 1.00 0.06 -- 0.06 (0.06) -- (0.06) 2000 1.00 0.05 -- 0.05 (0.05) -- (0.05) CLASSIC INSTITUTIONAL U.S. GOVERNMENT SECURITIES MONEY MARKET FUND Institutional Shares 2004 $1.00 $0.01 $-- $0.01 $(0.01) $-- $(0.01) 2003 1.00 0.01 -- 0.01 (0.01) -- (0.01) 2002 1.00 0.03 -- 0.03 (0.03) -- (0.03) 2001 1.00 0.06 -- 0.06 (0.06) -- (0.06) 2000 1.00 0.05 -- 0.05 (0.05) -- (0.05) CLASSIC INSTITUTIONAL U.S. TREASURY SECURITIES MONEY MARKET FUND Institutional Shares 2004 $1.00 $0.01 $-- $0.01 $(0.01) $--* $(0.01) 2003 1.00 0.01 -- 0.01 (0.01) --* (0.01) 2002 1.00 0.02 -- 0.02 (0.02) -- (0.02) 2001 1.00 0.06 -- 0.06 (0.06) -- (0.06) 2000 1.00 0.05 -- 0.05 (0.05) -- (0.05) Corporate Trust Shares 2004 $1.00 $0.01 $-- $0.01 $(0.01) $--* $(0.01) 2003 1.00 0.01 -- 0.01 (0.01) --* (0.01) 2002 1.00 0.02 -- 0.02 (0.02) -- (0.02) 2001 1.00 0.05 -- 0.05 (0.05) -- (0.05) 2000 (A) 1.00 0.05 -- 0.05 (0.05) -- (0.05)
RATIO OF RATIO OF NET ASSET NET ASSETS, RATIO OF NET NET INVESTMENT EXPENSES TO VALUE, END TOTAL END OF EXPENSES TO INCOME TO AVERAGE NET ASSETS OF PERIOD RETURN+ PERIOD (000) AVERAGE NET ASSETS AVERAGE NET ASSETS (EXCLUDING WAIVERS) ---------- ------- ------------ ------------------ ------------------ ------------------- CLASSIC INSTITUTIONAL CASH MANAGEMENT MONEY MARKET FUND Institutional Shares 2004 $1.00 0.86% $2,368,849 0.25% 0.86% 0.29% 2003 1.00 1.46 2,985,750 0.25 1.45 0.29 2002 1.00 2.68 3,409,606 0.25 2.61 0.29 2001 1.00 6.13 3,229,400 0.25 5.91 0.30 2000 1.00 5.56 2,311,685 0.25 5.42 0.30 CLASSIC INSTITUTIONAL U.S. GOVERNMENT SECURITIES MONEY MARKET FUND Institutional Shares 2004 $1.00 0.82% $ 858,260 0.27% 0.82% 0.29% 2003 1.00 1.40 1,040,066 0.26 1.39 0.29 2002 1.00 2.61 1,025,714 0.27 2.49 0.30 2001 1.00 5.98 896,189 0.26 5.72 0.29 2000 1.00 5.39 650,626 0.25 5.27 0.29 CLASSIC INSTITUTIONAL U.S. TREASURY SECURITIES MONEY MARKET FUND Institutional Shares 2004 $1.00 0.77% $ 420,948 0.26% 0.71% 0.29% 2003 1.00 1.30 653,340 0.26 1.23 0.29 2002 1.00 2.28 551,599 0.26 2.25 0.30 2001 1.00 5.74 580,227 0.27 5.44 0.30 2000 1.00 5.25 329,725 0.25 5.17 0.31 Corporate Trust Shares 2004 $1.00 0.57% $1,378,551 0.46% 0.51% 0.49% 2003 1.00 1.10 1,298,910 0.46 1.05 0.49 2002 1.00 2.08 1,805,066 0.46 2.11 0.50 2001 1.00 5.53 1,303,630 0.46 5.38 0.50 2000 (A) 1.00 5.02 1,138,541 0.45 4.93 0.49 + Returns are for the period indicated and have not been annualized. The performance in the above table does not reflect the deduction of taxes the shareholder would pay on fund distributions or redemption of fund shares. * Amount represents less than $0.01 per share. (A) Commenced operations on June 3, 1999. All ratios for the period have been annualized. Amounts designated as "--" are either $0 or have been rounded to $0.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. 54 - 55 NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 1. Organization: The STI Classic Funds (the "Trust") was organized as a Massachusetts business trust under a Declaration of Trust dated January 15, 1992. The Trust is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company offering 45 funds as of May 31, 2004. The financial statements presented herein are those of the Classic Institutional High Quality Bond Fund, the Classic Institutional Short-Term Bond Fund, the Classic Institutional Super Short Income Plus Fund, the Classic Institutional Total Return Bond Fund, the Classic Institutional U.S. Government Securities Super Short Income Plus Fund, the Classic Institutional Cash Management Money Market Fund, the Classic Institutional U.S. Government Securities Money Market Fund and the Classic Institutional U.S. Treasury Securities Money Market Fund (each a "Fund" and collectively the "Funds"). The Funds may offer the following share classes: Institutional shares, T shares, Corporate Trust shares and L shares. The financial statements of the remaining funds are presented separately. The assets of each Fund are segregated, and a shareholder's interest is limited to the Fund in which shares are held. The Funds' prospectus provides a description of the Funds' investment objectives, policies and strategies. 2. Significant Accounting Policies: The following is a summary of significant accounting policies followed by the Trust: 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 amount of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and reported amounts of revenues and expenses during the reporting period. Actual amounts could differ from these estimates. SECURITY VALUATION -- Debt securities are priced based upon valuations provided by independent, third-party pricing agents, if available. Such values generally reflect the last reported sales price if the security is actively traded. The third-party pricing agents may also value debt securities at an evaluated bid price by employing methodologies that utilize actual market transactions, broker-supplied valuations, or other methodologies designed to identify the market value for such securities. Debt obligations with remaining maturities of sixty days or less may be valued at their amortized cost, which approximates market value. Prices for most securities held in the Funds are provided daily by recognized independent pricing agents. If a security price cannot be obtained from an independent, third-party pricing agent, the Funds seek to obtain a bid price from at least one independent broker. Securities for which market prices are not "readily available" are valued in accordance with Fair Value Procedures established by the Funds' Board of Trustees. The Funds' Fair Value Procedures are implemented through a Fair Value Committee (the "Committee") designated by the Funds' Board of Trustees. Some of the more common reasons that may necessitate that a security be valued using Fair Value Procedures include: the security's trading has 56 been halted or suspended; the security has been de-listed from a national exchange; the security's primary trading market is temporarily closed at a time when under normal conditions it would be open; or the security's primary pricing source is not able or willing to provide a price. When a security is valued in accordance with the Fair Value Procedures, the Committee will determine the value after taking into consideration relevant information reasonably available to the Committee. SECURITY TRANSACTIONS AND INVESTMENT INCOME -- Security transactions are accounted for on the date the security is purchased or sold (trade date). Interest income is recognized on an accrual basis. Costs used in determining net realized gains and losses on the sales of investment securities are those of the specific securities sold adjusted for the accretion and amortization of purchase discounts and premiums during the respective holding period. Purchase discounts and premiums on securities held by the Funds are accreted and amortized ratably to the next interest readjustment date, the date that the principal owned can be recovered through demand, or the maturity of the security and are included in interest income. REPURCHASE AGREEMENTS -- In connection with transactions involving repurchase agreements, a third party custodian bank takes possession of the underlying securities ("collateral"), the value of which exceeds the principal amount of the repurchase transaction, including accrued interest. In the event of default on the obligation to repurchase, each Fund has the right to liquidate the collateral and apply the proceeds in satisfaction of the obligation. In the event of default or bankruptcy by the counterparty to the agreement, realization and/or retention of the collateral or proceeds may be subject to legal proceedings. EXPENSES -- Expenses that are directly related to a specific Fund are charged to that Fund. Class specific expenses are borne by that class. Other operating expenses of the Trust are pro-rated to the Funds on the basis of relative net assets. Fund expenses are pro-rated to the respective classes on the basis of relative net assets. CLASSES -- Income, non-class specific expenses and realized/unrealized gains and losses are allocated to the respective classes on the basis of the relative daily net assets. OFFERING COSTS -- Offering costs of the Classic Institutional High Quality Bond Fund and the Classic Institutional Total Return Bond Fund, which commenced operations on October 27, 2003 and October 15, 2003, respectively, include costs of printing initial prospectuses and registration fees, are being amortized to expenses over twelve months. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS -- Dividends and distributions to shareholders, which are determined in accordance with federal tax regulations, are recorded on the ex-dividend date. Dividends from net investment income of each of the Funds are declared daily and paid monthly. Any net realized capital gains on sales of securities are distributed to shareholders at least annually. 57 NOTES TO FINANCIAL STATEMENTS (continued) - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 COMPENSATING BALANCES -- If a Fund has a cash overdraft in excess of $100,000 it is required to leave 110% in compensating balance with SunTrust Bank (the "Custodian"), a wholly-owned subsidiary of SunTrust Banks, Inc., on the following day. If a Fund has a positive cash balance in excess of $100,000 it is allowed to overdraw 90% of the balance with the Custodian on the following business day. 3. Agreements and Other Transactions with Affiliates: INVESTMENT ADVISORY AGREEMENT -- The Trust and Trusco Capital Management, Inc. (the "Investment Adviser"), a wholly owned subsidiary of SunTrust Banks, Inc., have entered into advisory agree- ments dated June 15, 1993, and last amended November 12, 2003. Under terms of the agreement, the Funds are charged the following annual fees based upon average daily net assets: MAXIMUM ANNUAL NET ADVISORY FEES FEE PAID -------- ---- Classic Institutional High Quality Bond Fund ...................... 0.50% 0.40% Classic Institutional Short-Term Bond Fund ...................... 0.60 0.35 Classic Institutional Super Short Income Plus Fund ............... 0.50 0.20 Classic Institutional Total Return Bond Fund ...................... 0.45 0.35 Classic Institutional U.S. Government Securities Super Short Income Plus Fund ...................... 0.40 0.12 MAXIMUM ANNUAL NET ADVISORY FEES FEE PAID -------- ---- Classic Institutional Cash Management Money Market Fund .................. 0.20 0.17 Classic Institutional U.S. Government Securities Money Market Fund ....... 0.20 0.19 Classic Institutional U.S. Treasury Securities Money Market Fund ....... 0.20 0.19 The Investment Adviser has voluntarily agreed to waive all or a portion of its fees (and to reimburse Fund expenses). Fee waivers and expense reimbursements are voluntary and may be terminated at any time. ADMINISTRATION AGREEMENT -- The Trust and SEI Investments Global Funds Services (the "Administrator") are parties to an Administration Agreement dated May 29, 1995, as amended February 28, 2004 under which the Administrator provides administrative services for an annual fee (expressed as a percentage of the combined average daily net assets of the Trust and STI Classic Variable Trust) of: 0.12% up to $1 billion, 0.09% on the next $4 billion, 0.07% on on the next $3 billion, 0.065% on the next $2 billion and 0.06% for over $10 billion. The Administrator has voluntarily agreed to waive all or a portion of their fees (and to reimburse Fund expenses). Fee waivers and expense reimbursements are voluntary and may be terminated at any time. DISTRIBUTION AGREEMENT -- The Trust and SEI Investments Distribution Co. (the "Distributor") are parties to a Distribution Agreement dated November 21, 1995. The Distributor will receive no fees for its distribution services under this 58 agreement for the Institutional, Corporate Trust, and T Shares of any Fund. With respect to the L Shares of the Classic Institutional U.S. Government Securities Super Short Income Plus Fund the Distributor receives 0.40%, pursuant to a Distribution and Service Plan. The Fund is currently paying net fees of 0.21%. The Distributor has voluntarily agreed to waive all or a portion of its fees (and to reimburse Fund expenses). Fee waivers and expense reimbursements are voluntary and may be terminated at any time. SHAREHOLDER SERVICING AGREEMENT -- The Classic Institutional U.S. Treasury Securities Money Market Fund has adopted a Shareholder Services Plan for the Corporate Trust Shares. The Fund pays SunTrust Bank ("SunTrust") a monthly shareholder services fee at an annual rate of up to 0.25% of the average daily net assets of the average daily net assets of the Fund's Corporate Trust Shares, which may be used by SunTrust to provide compensation to service providers that have agreed to provide shareholder support services for their customers who own Corporate Trust Shares of the Fund. The Fund is currently paying SunTrust an annual rate of 0.20%. The Classic Institutional High Quality Bond Fund, Classic Institutional Short-Term Bond, Classic Institutional Super Short Income Plus, Classic Institutional Total Return Bond Fund, and Classic Institutional U.S. Government Securities Super Short Income Plus Funds have adopted a Shareholder Services Plan whereby each Fund pays SunTrust a monthly shareholder services fee as outlined below, which may be used by SunTrust to provide compensation to service providers that have agreed to provide shareholder support services for their customers who own shares of the Fund. SunTrust has voluntarily agreed to waive all or a portion of its fees. These fee waivers are voluntary and may be terminated at any time. MAXIMUM ANNUAL SHAREHOLDER NET FEES SERVICE FEE PAID (INSTITUTIONAL (INSTITUTIONAL SHARES) SHARES) -------------- -------------- Classic Institutional High Quality Bond Fund ........................ 0.25% 0.09% Classic Institutional Short-Term Bond Fund ........................ 0.25 -- Classic Institutional Super Short Income Plus Fund ................. 0.25 -- Classic Institutional Total Return Bond Fund ........................ 0.25 -- Classic Institutional U.S. Government Securities Super Short Income Plus Fund ........................ 0.25 -- MAXIMUM ANNUAL SHAREHOLDER NET FEES SERVICE FEE PAID (T SHARES) (T SHARES) -------------- -------------- Classic Institutional High Quality Bond Fund ........................ 0.40% 0.29% Classic Institutional Short-Term Bond Fund ........................ -- -- Classic Institutional Super Short Income Plus Fund ................. 0.25 0.20 Classic Institutional Total Return Bond Fund ........................ 0.35 0.20 Classic Institutional U.S. Government Securities Super Short Income Plus Fund ........................ -- -- TRANSFER AGENCY AGREEMENTS -- The Trust and Federated Services Company are parties to an Agreement for Shareholder Recordkeeping, dated May 14, 1994, as amended April 16, 2003, under which Federated Services Company provides transfer agency services to the Trust. The Trust and SunTrust Securities Inc. ("STS"), a wholly-owned subsidiary of SunTrust Banks, Inc., 59 NOTES TO FINANCIAL STATEMENTS (continued) - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 are parties to an agreement under which STS provides certain transfer agency account activity processing and servicing. The transfer agent shareholder service fees are based upon a monthly per account charge for the total shareholder accounts at the Trust's transfer agent. These fees are presented on the Statements of Operations as Transfer Agent Shareholder Servicing Fees. CUSTODIAN AGREEMENT -- The custodian is paid on the basis of the net assets and transaction costs of the Funds. The custodian plays no role in determining the investment policies of the Trust or which securities are to be purchased or sold in the Funds. OTHER -- Certain officers of the Trust are also officers of the Adviser, Administrator and/or the Distributor. Such officers are paid no fees by the Trust for serving as officers of the Trust. The Trust has entered into an agreement with SunTrust Robinson Humphrey, a division of SunTrust Capital Markets, Inc. which is a direct non-bank subsidiary of SunTrust Banks, Inc. to act as an agent in placing repurchase agreements for the Trust. For the year or period ended May 31, 2004, the following Funds paid SunTrust Robinson Humphrey, through a reduction in the yield, earned by the Funds on those repurchase agreements: FEES ------ Classic Institutional High Quality Bond Fund ................................. $ 864 Classic Institutional Super Short Income Plus Fund ................................. 10,693 Classic Institutional Total Return Bond Fund ................................. 364 Classic Institutional U.S. Government Securities Super Short Income Plus Fund .............. 6,955 Classic Institutional Cash Management Money Market Fund ............................... 201,722 Classic Institutional U.S. Government Securities Money Market Fund ......................... 133,911 Classic Institutional U.S. Treasury Securities Money Market Fund ......................... 751,820 4. Investment Transactions: The cost of purchases and the proceeds from sales and maturities of securities, excluding short-term investments and U.S. Government securities, for the year or period ended May 31, 2004, were as follows: SALES AND PURCHASES MATURITIES (000) (000) --------- ---------- Classic Institutional High Quality Bond Fund ......................... $37,845 $ 1,121 Classic Institutional Short-Term Bond Fund ......................... 14,118 5,089 Classic Institutional Super Short Income Plus Fund ................. 64,944 55,558 Classic Institutional Total Return Bond Fund ......................... 25,710 5,265 Classic Institutional U.S. Government Super Short Income Plus Fund ...... 4,936 4,002 The cost of purchases and proceeds from sales and maturities of U.S. Government securities, for the year or period ended May 31, 2004, were as follows: SALES AND PURCHASES MATURITIES (000) (000) --------- ---------- Classic Institutional High Quality Bond Fund ........................ $114,368 $23,536 Classic Institutional Short-Term Bond Fund ........................ 16,687 11,961 Classic Institutional Super Short Income Plus Fund ................. 40,730 34,154 Classic Institutional Total Return Bond Fund ........................ 57,797 32,472 Classic Institutional U.S. Government Securities Super Short Income Plus Fund ........................ 41,281 54,496 5. Federal Tax Policies and Information: It is each Fund's intention to continue to qualify as a regulated investment company for Federal income tax purposes and distribute all of its taxable income and net capital gains. Accordingly, no provisions for Federal income taxes are required. 60 - -------------------------------------------------------------------------------- The timing and characterization of certain income and capital gains distributions are determined annually in accordance with federal tax regulations which may differ from accounting principles generally accepted in the United States of America. As a result, net investment income (loss) and net realized gain (loss) on investment transactions for a reporting period may differ significantly from distributions during such period. These book/tax differences may be temporary or permanent. To the extent theses differences are permanent in nature, they are charged or credited to paid-in-capital or accumulated net realized gain, as appropriate, in the period that the differences arise. Accordingly, the following permanent differences, primarily attributable to the classification of short-term capital gains and ordinary income for tax purposes, and paydowns on mortgage-backed securities have been reclassified to/from the following accounts: UNDISTRIBUTED ACCUMULATED NET INVESTMENT REALIZED INCOME LOSS (000) (000) -------------- ----------- Classic Institutional High Quality Bond Fund ....................... $ 36 $ (36) Classic Institutional Total Return Bond Fund ....................... 38 (38) Classic Institutional U.S. Government Securities Super Short Income Plus Fund ....................... 342 (342) Classic Institutional Cash Management Money Market Fund ............... 79 (79) Classic Institutional U.S. Government Securities Money Market Fund .... 3 (3) The tax character of dividends and distributions declared during the periods ended May 31, 2004 and May 31, 2003 were as follows: LONG-TERM ORDINARY CAPITAL INCOME GAIN TOTALS (000) (000) (000) -------- -------- ------ Classic Institutional High Quality Bond Fund 2004 ........................... $1,056 $-- $ 1,056 Classic Institutional Short-Term Bond Fund 2004 ........................... 651 20 671 2003 ........................... 718 -- 718 Classic Institutional Super Short Income Plus Fund 2004 ........................... 3,817 -- 3,817 2003 ........................... 2,148 -- 2,148 Classic Institutional Total Return Bond Fund 2004 ........................... 607 -- 607 Classic Institutional U.S. Government Securities Super Short Income Plus Fund 2004 ........................... 1,906 -- 1,906 2003 ........................... 1,581 -- 1,581 Classic Institutional Cash Management Money Market Fund 2004 ........................... 23,696 -- 23,696 2003 ........................... 45,956 -- 45,956 Classic Institutional U.S. Government Securities Money Market Fund 2004 ........................... 8,014 -- 8,014 2003 ........................... 14,586 -- 14,586 Classic Institutional U.S. Treasury Securities Money Market Fund 2004 ........................... 12,365 36 12,401 2003 ........................... 23,256 -- 23,256 61 NOTES TO FINANCIAL STATEMENTS (continued) - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 As of May 31, 2004, the components of Distributable Earnings/(Accumulated Losses) on a tax basis were as follows:
UNDISTRIBUTED UNDISTRIBUTED POST CAPITAL OTHER ORDINARY LONG-TERM UNREALIZED OCTOBER LOSS TEMPORARY INCOME CAPITAL GAIN DEPRECIATION LOSSES CARRYFORWARDS DIFFERENCES TOTALS (000) (000) (000) (000) (000) (000) (000) ------------- ------------ ------------ ------- ------------- ----------- ------ Classic Institutional High Quality Bond Fund ............................. $ 196 $-- $(2,904) $-- $-- $ (10) $(2,718) Classic Institutional Short-Term Bond Fund ............................. 17 44 (218) -- -- -- (157) Classic Institutional Super Short Income Plus Fund ...................... -- -- (418) (23) (588) -- (1,029) Classic Institutional Total Return Bond Fund ............................. 11 -- (1,491) -- (219) (10) (1,709) Classic Institutional U.S. Government Securities Super Short Income Plus Fund 1 -- (144) (238) (518) -- (899) Classic Institutional Cash Management Money Market Fund ..................... 79 -- -- -- -- -- 79 Classic Institutional U.S. Government Securities Money Market Fund .......... 3 -- -- -- -- -- 3 Classic Institutional U.S. Treasury Securities Money Market Fund .......... 737 -- -- -- -- -- 737 Amounts designated as "--" are either $0 or have been rounded to $0.
Post-October losses represent losses realized on investment transactions from November 1, 2003 through May 31, 2004, that in accordance with Federal income tax regulations the Funds may elect to defer and treat as having arisen in the following fiscal year. For Federal income tax purposes, capital loss carryforwards may be carried forward and applied against future capital gains. At May 31, 2004, the Classic Institutional Super Short Income Plus, the Classic Institutional Total Return Bond and the Classic Institutional U.S. Government Securities Super Short Income Plus Funds had capital loss carryforwards of $587,658, $218,476 and $518,385, respectively, available to offset future capital gains through May 31, 2012. During the year ended May 31, 2004, the Classic Institutional U.S. Government Securities Money Market Fund utilized capital loss carryforwards in the amount of $74 to offset capital gains realized. At May 31, 2004, the total cost of securities and the net realized gains or losses on securities sold for Federal income tax purposes were different from amounts reported for financial reporting purposes. The aggregate gross unrealized appreciation and depreciation for securities held by the Funds at May 31, 2004, were as follows:
AGGREGATE GROSS GROSS FEDERAL TAX UNREALIZED UNREALIZED UNREALIZED COST APPRECIATION DEPRECIATION DEPRECIATION (000) (000) (000) (000) ----------- ------------ ------------ ------------ Classic Institutional High Quality Bond Fund ..... $135,979 $ 13 $ (2,917) $ (2,904) Classic Institutional Short-Term Bond Fund ....... 37,267 74 (292) (218) Classic Institutional Super Short Income Plus Fund 251,295 272 (690) (418) Classic Institutional Total Return Bond Fund ..... 48,520 4 (1,495) (1,491) Classic Institutional U.S. Government Securities Super Short Income Plus Fund .................. 115,746 105 (249) (144)
62
- -------------------------------------------------------------------------------------- 6. Capital Share Transactions: Capital share transactions for the Funds were as follows (000): CLASSIC CLASSIC CLASSIC INSTITUTIONAL INSTITUTIONAL INSTITUTIONAL HIGH QUALITY SHORT-TERM SUPER SHORT BOND BOND INCOME PLUS FUND FUND FUND ------- ------------------ ------------------ 10/27/03*- 06/01/03- 06/01/02- 06/01/03- 06/01/02- 05/31/04 05/31/04 05/31/03 05/31/04 05/31/03 ------- ------- ------- ------- ------- Shares Issued and Redeemed: Institutional Shares: Shares Issued .............. 2,643 2,444 1,113 77,447 94,687 Shares Issued in Lieu of Cash Distributions .... 15 40 44 245 62 Shares Redeemed ............ (67) (958) (741) (94,148) (39,084) ------- ------- ------- ------- ------- Net Institutional Share Transactions ....... 2,591 1,526 416 (16,456) 55,665 ------- ------- ------- ------- ------- Corporate Trust Shares: Shares Issued .............. -- -- -- -- -- Shares Issued in Lieu of Cash Distributions ....... -- -- -- -- -- Shares Redeemed ............ -- -- -- -- -- ------- ------- ------- ------- ------- Net Corporate Trust Share Transactions ....... -- -- -- -- -- ------- ------- ------- ------- ------- T Shares: Shares Issued .............. 11,601 -- -- 74,978 37,979 Shares Issued in Lieu of Cash Distributions ....... 8 -- -- 105 18 Shares Redeemed ............ (559) -- -- (40,981) (3,309) ------- ------- ------- ------- ------- Net T Share Transactions ... 11,050 -- -- 34,102 34,688 ------- ------- ------- ------- ------- L Shares: Shares Issued .............. -- -- -- -- -- Shares Issued in Lieu of Cash Distributions ....... -- -- -- -- -- Shares Redeemed ............ -- -- -- -- -- ------- ------- ------- ------- ------- Net L Share Transactions ... -- -- -- -- -- ------- ------- ------- ------- ------- Net Change in Capital Shares 13,641 1,526 416 17,646 90,353 ======= ======= ======= ======= ======= *COMMENCEMENT OF OPERATIONS
63 NOTES TO FINANCIAL STATEMENTS (continued) - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 6. Capital Share Transactions (continued): Capital share transactions for the Funds were as follows (000): CLASSIC CLASSIC INSTITUTIONAL INSTITUTIONAL TOTAL RETURN U.S. GOVERNMENT SECURITIES BOND SUPER SHORT INCOME PLUS FUND FUND ------------- -------------------------- 10/15/03*- 06/01/03- 06/01/02- 05/31/04 05/31/04 05/31/03 --------- -------- -------- Shares Issued and Redeemed: Institutional Shares: Shares Issued .............. 1,796 30,928 61,485 Shares Issued in Lieu of Cash Distributions .... 22 297 455 Shares Redeemed ............ (232) (39,825) (28,680) ------- ------- ------- Net Institutional Share Transactions ....... 1,586 (8,600) 33,260 ------- ------- ------- Corporate Trust Shares: Shares Issued .............. -- -- -- Shares Issued in Lieu of Cash Distributions ....... -- -- -- Shares Redeemed ............ -- -- -- ------- ------- ------- Net Corporate Trust Share Transactions ....... -- -- -- ------- ------- ------- T Shares: Shares Issued .............. 3,381 -- -- Shares Issued in Lieu of Cash Distributions ....... 35 -- -- Shares Redeemed ............ (160) -- -- ------- ------- ------- Net T Share Transactions ... 3,256 -- -- ------- ------- ------- L Shares: Shares Issued .............. -- 8,554 2,509 Shares Issued in Lieu of Cash Distributions ....... -- 48 1 Shares Redeemed ............ -- (7,134) (137) ------- ------- ------- Net L Share Transactions ... -- 1,468 2,373 ------- ------- ------- Net Change in Capital Shares 4,842 (7,132) 35,633 ======= ======= ======= *COMMENCEMENT OF OPERATIONS 64
- ------------------------------------------------------------------------------------------------------------------------ CLASSIC CLASSIC CLASSIC INSTITUTIONAL INSTITUTIONAL INSTITUTIONAL CASH MANAGEMENT U.S. GOVERNMENT U.S. TREASURY MONEY MARKET SECURITIES MONEY SECURITIES MONEY FUND MARKET FUND MARKET FUND --------------- ---------------- ---------------- 06/01/03- 06/01/02- 06/01/03- 06/01/02- 06/01/03- 06/01/02- 05/31/04 05/31/03 05/31/04 05/31/03 05/31/04 05/31/03 ---------- ---------- ---------- ---------- ---------- ---------- Shares Issued and Redeemed: Institutional Shares: Shares Issued .............. 7,415,918 8,275,886 2,512,598 2,229,173 3,003,944 3,267,354 Shares Issued in Lieu of Cash Distributions .... 14,226 28,135 2,820 4,993 2,922 5,216 Shares Redeemed ............ (8,047,111) (8,727,887) (2,697,227) (2,219,814) (3,239,309) (3,170,785) ---------- ---------- ---------- ---------- ---------- ---------- Net Institutional Share Transactions ....... (616,967) (423,866) (181,809) 14,352 (232,443) 101,785 ---------- ---------- ---------- ---------- ---------- ---------- Corporate Trust Shares: Shares Issued .............. -- -- -- -- 3,290,925 3,516,733 Shares Redeemed ............ -- -- -- -- (3,211,341) (4,022,699) ---------- ---------- ---------- ---------- ---------- ---------- Net Corporate Trust Share Transactions ....... -- -- -- -- 79,584 (505,966) ---------- ---------- ---------- ---------- ---------- ---------- Net Change in Capital Shares (616,967) (423,866) (181,809) 14,352 (152,859) (404,181) ========== ========== ========== ========== ========== ==========
7. Concentrations/Risk: The Classic Institutional Cash Management Money Market Fund, the Classic Institutional U.S. Government Securities Money Market Fund and the Classic Institutional U.S. Treasury Securities Money Market Fund invest primarily in money market instruments maturing in 397 days or less whose ratings are within one of the two highest ratings categories assigned by a nationally recognized statistical rating agency, or, if not rated, are believed to be of comparable quality. The ability of the issuers of the securities held by the Fund to meet their obligations may be affected by economic developments in a specific industry, state or region. Certain securities are backed by letters of credit from various financial institutions and financial guaranty assurance agencies. These letters of credit enhance the credit quality of the individual securities; however, if any of the financial institutions or financial guaranty assurance agencies' credit quality should deteriorate, it could cause the individual security's credit quality to change. Additionally, if any of the Funds concentrate their letters of credit in any one financial institution, the risk of credit quality deterioration increases. The Funds hold certain securities whereby the issuer operates under a congressional charter; these securities (Federal Home Loan Mortgage 65 NOTES TO FINANCIAL STATEMENTS (concluded) - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 Corporation, Federal Home Loan Bank and Federal National Mortgage Association) are neither issued nor guaranteed by the U.S. Government. If needed, access to additional funding from the U.S. Treasury (beyond the issuer's line of credit), would require congressional action. In the normal course of business, the Funds may enter into contracts that provide general indemnifications. The Funds' maximum exposure under these arrangements is dependent on future claims that may be made against the Funds and, therefore, cannot be estimated; however, based on experience, the risk of loss from such claims is considered remote. 8. Securities Lending Each Fund may lend portfolio securities to brokers, dealers and other financial organizations that meet capital and other credit requirements or other criteria established by the Trust's Board of Trustees. These loans may not exceed 33 1/3% of the total asset value of the Fund (including the loan collateral). No Fund will lend portfolio securities to its investment adviser or its affiliates unless it has applied for and received specific authority to do so from the Securities and Exchange Commission. Loans of portfolio securities will be fully collateralized by cash. The value of the collateral is at least equal to the market value of the securities loaned. However, due to market fluctuations during the day, the value of securities loaned on a particular day may, during the course of the day, exceed the value of collateral. On each business day, the amount of collateral is adjusted based on the prior day's market fluctuations and the current day's lending activity. Income from lending activity is determined by the amount of interest earned on collateral, less any amounts payable to the borrowers of the securities and the lending agent. Lending securities involves certain risks, including the risk that the Fund may be delayed or prevented from recovering the collateral if the borrower fails to return the securities. Cash collateral received in connection with securities lending is invested in the Boston Global Investment Trust -- Enhanced Portfolio. This investment consists of money market instruments including money market mutual funds registered under the Investment Company Act of 1940, commercial paper, repurchase agreements and U.S. Agency Obligations. 9. Subsequent Event Effective July 26, 2004, under separate administration, distribution and transfer agency agreements dated July 24, 2004, July 24, 2004 and July 23, 2004, respectively, BISYS Fund Services began providing administration, distribution and transfer agency services for the Funds. 66 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 To the Board of Trustees and Shareholders of STI Classic Funds: In our opinion, the accompanying statements of net assets of Classic Institutional High Quality Bond Fund, Classic Institutional Short-Term Bond Fund, Classic Institutional Super Short Income Plus Fund, Classic Institutional Total Return Bond Fund, Classic Institutional U.S. Government Securities Super Short Income Plus Fund, Classic Institutional Cash Management Money Market Fund and Classic Institutional U.S. Government Securities Money Market Fund and the statement of assets and liabilities, including the schedule of investments, of Classic Institutional U.S. Treasury Securities Money Market Fund (eight of the forty-five funds constituting STI Classic Funds, hereafter referred to as the "Funds") and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of the Funds at May 31, 2004, the results of each of their operations for the year (or period) then ended, the changes in each of their net assets for each of the two years (or periods) then ended and the financial highlights for each of the three years (or periods) then ended and for the Classic Institutional High Quality Bond Fund and the Classic Institutional Total Return Bond Fund the changes in their net assets and their financial highlights for the period then ended, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Funds' management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States), which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included physical inspection of securities at May 31, 2004, provide a reasonable basis for our opinion. The financial highlights for each of the two years (or periods) ended May 31, 2001 were audited by other independent accountants who have ceased operations. Those independent accountants expressed an unqualified opinion on those financial statements in their report dated July 18, 2001. PricewaterhouseCoopers LLP Philadelphia, Pennsylvania July 26, 2004 67 TRUSTEES AND OFFICERS OF THE STI CLASSIC FUNDS - -------------------------------------------------------------------------------- Information pertaining to the trustees and officers of the Trust is set forth below. Trustees who are not deemed to be "interested persons" of the Trust as defined in the 1940 Act are referred to as "Independent Trustees." Trustees who are deemed
- --------------------------------------------------------------------------------------------------------------------------- TERM OF NUMBER OF OFFICE PORTFOLIOS AND PRINCIPAL IN STI CLASSIC NAME POSITION(S) LENGTH OF OCCUPATION(S) COMPLEX OTHER DIRECTORSHIPS ADDRESS, HELD WITH TIME DURING PAST OVERSEEN BY HELD BY AND AGE 1 THE TRUST SERVED 2 5 YEARS BOARD MEMBER 3 BOARD MEMBER 4 - --------------------------------------------------------------------------------------------------------------------------- INTERESTED BOARD MEMBERS 5 Richard W. Courts, II, Trustee Since Chairman of the Board, Atlantic 52 Current Trustee of STI 68 November, Investment Company, 1970 to the Classic Variable Trust. 2001 present. - --------------------------------------------------------------------------------------------------------------------------- Clarence H. Ridley, 62 Trustee Since Chairman of the Board; Haverty 52 Current Trustee of STI November, Furniture Companies, 2001 to the Classic Variable Trust. 2001 present; Partner, King and Spaulding LLP (law firm), 1971 to 2000. - --------------------------------------------------------------------------------------------------------------------------- INDEPENDENT BOARD MEMBERS Thomas Gallagher, 56 Trustee Since President, Genuine Parts Company 52 Director, National Service May, 2000 Wholesale Distribution, 1970 to the Industries; Director, Oxford present. Industries. Current Trustee of STI Classic Variable Trust. - --------------------------------------------------------------------------------------------------------------------------- F. Wendell Gooch, 71 Trustee Since Retired. 52 Current Trustee on the Board May, 1992 Board of Trustees for the SEI Family of Funds, The Capitol Mutual Funds and STI Classic Variable Trust. - --------------------------------------------------------------------------------------------------------------------------- James O. Robbins, 62 Trustee Since President and Chief Executive 52 Director, NCR; Director, May, 2000 Officer, Cox Communications, Inc., Cox Communications, 1983 to the present. Current Trustee of STI Classic Variable Trust. - --------------------------------------------------------------------------------------------------------------------------- Jonathan T. Walton, 74 Trustee Since Retired. 52 Trustee, W.K. Kellogg Trust. February, Current Trustee of STI 1998 Classic Variable Trust. - ---------------------------------------------------------------------------------------------------------------------------
68 - -------------------------------------------------------------------------------- (UNAUDITED) to be "interested persons" of the Trust are referred to as "Interested Trustees." Messrs. Courts and Ridley are Trustees who may be deemed to be "interested" persons of the Trust.
- ----------------------------------------------------------------------------------------------------------------------- TERM OF NUMBER OF OFFICE PORTFOLIOS AND PRINCIPAL IN STI CLASSIC NAME POSITION(S) LENGTH OF OCCUPATION(S) COMPLEX OTHER DIRECTORSHIPS ADDRESS, HELD WITH TIME DURING PAST OVERSEEN BY HELD BY AND AGE 1 THE TRUST SERVED 5 YEARS BOARD MEMBER BOARD MEMBER - ----------------------------------------------------------------------------------------------------------------------- OFFICERS James F. Volk, President Since SEI Investments since 1996; N/A N/A 41 November, Senior Operations Officer Fund 2003 Accounting and Administration, 1996-2004, Chief Accounting Officer, present; Assistant Chief Accountant, U.S. Securities and Exchange Commission, 1993- 1996; Audit Manager, Coopers & Lybrand LLP, 1985-1993. - ----------------------------------------------------------------------------------------------------------------------- Timothy D. Barto, Vice Since SEI Investments since 1999; N/A N/A 36 President November, General Counsel, Vice President and 2001 and Secretary of the Administrator Secretary and Adviser, present; Associate, Dechert, Price & Rhodes, 1997-1999. - ----------------------------------------------------------------------------------------------------------------------- Lydia A. Gavalis, Vice Since SEI Investments since 1998; Vice N/A N/A 40 President May, 1998 President and Assistant Secretary and of the Administrator and Adviser, Assistant present; Assistant General Counsel Secretary and Director of Arbitration, Philadelphia Stock Exchange, 1989-1998. - ----------------------------------------------------------------------------------------------------------------------- Christine M. Vice Since SEI Investments since 1999; Vice N/A N/A McCullough, President May, 2000 President and Assistant Secretary 43 and of the Adviser, present; Associate, Assistant White and Williams LLP, Secretary 1991-1999. - ----------------------------------------------------------------------------------------------------------------------- William E. Vice Since SEIInvestments since 2000; N/A N/A Zitelli Jr., President November, Assistant Secretary of the 35 and 2000 Administrator and Adviser, Assistant present; Vice President, Merrill Secretary Lynch & Co. Asset Management Group, 1998-2000; Associate, Pepper Hamilton LLP, 1997-1998. - ----------------------------------------------------------------------------------------------------------------------- 1 Each trustee and officer may be contacted by writing to c/o STI Classic Funds, SEI Investments Company, Oaks, PA 19456. 2 Each trustee shall hold office during the lifetime of this Trust until the election and qualification of his or her successor, or until he or she sooner dies, resigns or is removed in accordance with the Trust's Declaration of Trust. 3 The "STI Classic Complex" consists of all registered investment companies for which Trusco Capital Management, Inc. serves as investment adviser. As of May 31, 2004, the STI Classic Complex consisted of 52 Funds. 4 Directorships of companies required to report to the U.S. Securities and Exchange Commission under the Securities Exchange Act of 1934 (i.e., "public companies") or other investment companies registered under the 1940 Act. 5 Mr. Courts is deemed an interested trustee because of his directorships with affiliates of the Adviser. Mr. Ridley is deemed an interested trustee because of his material business relationships with the parent to the Adviser.
69 TRUSTEES AND OFFICERS OF THE STI CLASSIC FUNDS (concluded) - --------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------- TERM OF NUMBER OF OFFICE PORTFOLIOS AND PRINCIPAL IN STI CLASSIC NAME POSITION(S) LENGTH OF OCCUPATION(S) COMPLEX OTHER DIRECTORSHIPS ADDRESS, HELD WITH TIME DURING PAST OVERSEEN BY HELD BY AND AGE 1 THE TRUST SERVED 5 YEARS BOARD MEMBER BOARD MEMBER - ------------------------------------------------------------------------------------------------------------------------- OFFICERS (CONTINUED) Douglas Phillips, Vice Since President, Chief Executive Officer N/A N/A 56 President August, and Chief Investment Officer and 2003 of Trusco Capital Management, Assistant Inc. since its inception in Secretary November 1984. - ------------------------------------------------------------------------------------------------------------------------- Deborah A. Lamb, Vice Since Chief Compliance Officer and N/A N/A 51 President November, Vice President of Trusco Capital and 2003 Management, Inc. since March Assistant 2003 and President of Investment Secretary Industry Consultants, LLC since June 2000. Director of Compliance at INVESCO, Inc. from March 1995 to June 2000. - ------------------------------------------------------------------------------------------------------------------------- Kathleen Lentz, Vice Since Vice President and Manager of N/A N/A 43 President November, Special Entities in Financial and 2003 Intelligence Unit of SunTrust Assistant Bank since 2002. Vice President Secretary of the Third Party Mutual Funds Unit of SunTrust Bank, 1996-2002. - ------------------------------------------------------------------------------------------------------------------------- John Munera, Vice Since Middle Office Compliance Officer N/A N/A 41 President November, at SEI Investments since 2000. and 2003 Supervising Examiner at Federal Assistant Reserve Bank of Philadelphia Secretary 1998-2000. - ------------------------------------------------------------------------------------------------------------------------- Jennifer E. Spratley, Treasurer Since Funds Accounting Director, SEI N/A N/A 35 and May, 2000 Investments, 1999-present; Audit CFO Manager, Ernst & Young LLP, 1991-1999. - ------------------------------------------------------------------------------------------------------------------------- 1 Each trustee and officer may be contacted by writing to c/o STI Classic Funds, SEI Investments Company, Oaks, PA 19456.
70 NOTICE TO SHAREHOLDERS - -------------------------------------------------------------------------------- STI CLASSIC FUNDS MAY 31, 2004 (UNAUDITED) For shareholders that do not have a May 31, 2004 tax year end, this notice is for informational purposes only. For shareholders with a May 31, 2004 tax year end, please consult your tax adviser as to the pertinence of this notice. For the fiscal period ended May 31, 2004, each portfolio is designating the following items with regard to distributions paid during the year.
LONG TERM LONG TERM (15% RATE) (20% RATE) QUALIFIED ORDINARY CAPITAL GAINS CAPITAL GAIN 5-YEAR GAIN INCOME TAX-EXEMPT TOTAL QUALIFYING FUND DISTRIBUTIONS DISTRIBUTIONS DISTRIBUTION DISTRIBUTIONS INTEREST DISTRIBUTIONS DIVIDENDS (1) - ------------------------------------ ------------- ------------- ------------ ------------- --------- ------------- ------------- Classic Institutional High Quality Bond Fund ........................ 0.00% 0.00% 0.00% 100.00% 0.00% 100.00% 0.00% Classic Institutional Short-Term Bond Fund ........................ 3.07% 0.00% 0.00% 96.93% 0.00% 100.00% 0.00% Classic Institutional Super Short Income Plus Fund ................. 0.00% 0.00% 0.00% 100.00% 0.00% 100.00% 0.00% Classic Institutional Total Return Bond Fund ........................ 0.00% 0.00% 0.00% 100.00% 0.00% 100.00% 0.00% Classic Institutional U.S. Government Securities Super Short Income Plus Fund ................. 0.00% 0.00% 0.00% 100.00% 0.00% 100.00% 0.00% Classic Institutional Cash Management Money Market Fund ................ 0.00% 0.00% 0.00% 100.00% 0.00% 100.00% 0.00% Classic Institutional U.S. Government Securities Money Market Fund ............... 0.00% 0.00% 0.00% 100.00% 0.00% 100.00% 0.00% Classic Institutional U.S. Treasury Securities Money Market Fund ............... 0.00% 0.27% 0.00% 99.73% 0.00% 100.00% 0.00% (1) Qualifying dividends represent dividends which qualify for the corporate dividends received deduction and is reflected as a percentage of "Ordinary Income Distributions".
71 NOTES - -------------------------------------------------------------------------------- INVESTMENT ADVISER Trusco Capital Management, Inc. STI Classic Funds are not deposits, are not insured or guaranteed by the FDIC or any other government agency, and are not endorsed by and do not constitute obligations of SunTrust Banks, Inc. or any other of its affiliates. Investment in the Funds involves risk, including the possible loss of principal. There is no guarantee that any STI Classic Fund will achieve its investment objective. The STI Classic Funds are advised by an affiliate of SunTrust Banks, Inc. DISTRIBUTOR SEI Investments Distribution Co. This information must be preceded or accompanied by a current prospectus for each Fund described. STI-AR-004-0400 ITEM 2. CODE OF ETHICS. The registrant has adopted a code of ethics that applies to the registrant's principal executive officer, principal financial officer, principal accounting officer, officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party. ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT. The registrant's Board of Trustees has determined that the Board's Audit Committee does not have an "audit committee financial expert," as the Securities and Exchange Commission has defined that term. After carefully considering all of the factors involved in the definition of "audit committee financial expert," the Board determined that none of the members of the audit committee met all five qualifications in the definition, although some members of the Audit Committees met some of the qualifications. The Board also determined that the Audit Committee members collectively have many years of experience in business and finance, including working with mutual fund financial statements and auditors, and that in light of the nature of the accounting and valuation issues the registrant's portfolios have presented over the past several years, it did not appear that the Audit Committee members lacked any necessary skill to serve on the Audit Committee. ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES. Fees billed by PricewaterhouseCoopers LLP ("PWC") related to the Trust PWC billed the Trust aggregate fees for services rendered to the Trust for the last two fiscal years as follows:
- -------------------------------------------------------------------------------------------------------------------------------- 2004 2003 - -------------------------------------------------------------------------------------------------------------------------------- All fees and All fees and All other fees All fees and All fees and All other fees services to the services to and services to services to the services to and services to Trust that were service service Trust that were service service pre-approved affiliates that affiliates that pre-approved affiliates that affiliates that were did not require were did not require pre-approved pre-approval pre-approved pre-approval - -------------------------------------------------------------------------------------------------------------------------------- (a) Audit $ 563,000 N/A $ 0 $ 448,509 N/A $ 0 Fees(1) - -------------------------------------------------------------------------------------------------------------------------------- (b) Audit- $ 72,000 (2) $ 60,000 (3) $ 1,795,277 (4) $ 61,500 (2) $ 0 $ 1,498,453 (4) Related Fees - -------------------------------------------------------------------------------------------------------------------------------- (c) Tax Fees $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 - -------------------------------------------------------------------------------------------------------------------------------- (d) All $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 Other Fees - --------------------------------------------------------------------------------------------------------------------------------
Notes: (1) Audit fees include amounts related to the audit of the registrant's annual financial statements and services normally provided by the accountant in connection with statutory and regulatory filings. (2) Services related to security count examinations under Rule 17f-2 of the Investment Company Act for 2004 and 2003 fiscal years. (3) Services related to the audit of the controls around custody operations at SunTrust Bank (SAS No. 70) in 2003. (4) Non-audit services relate principally to certain technical accounting advice on financial products of the Bank; Sarbanes-Oxley 404 implementation; and, tax compliance services to other entities controlled by SunTrust Banks, Inc. (e)(1) The registrant has adopted an Audit and Non-Audit Services Pre-Approval Policy, as follows: I. Statement of Principles As set forth in the chart below, the Sarbanes-Oxley Act of 2002 (the "Act"), and rules adopted by the Securities and Exchange Commission ("SEC") require that the Audit Committee of the Board of Trustees pre-approve all audit services and non-audit services provided to the STI Classic Funds and the STI Classic Variable Trust (the "Trusts") and their respective portfolios (the "Funds") by its independent accountant ("Auditor"),1 as well as non-audit services provided by the Auditor to the Funds' investment adviser and to affiliates of the adviser that provide ongoing services to the Funds ("Service Affiliates") if the services directly impact the Funds' operations and financial reporting.
WHERE PRE-APPROVAL IS REQUIRED - -------------------------------------------------------------------------------------------------------- AUDIT SERVICE NON-AUDIT SERVICE - -------------------------------------------------------------------------------------------------------- Fund Yes Yes - -------------------------------------------------------------------------------------------------------- Adviser No Yes, if directly related to Fund operation and financial reporting - -------------------------------------------------------------------------------------------------------- Service Affiliate 2 No Yes, if directly related to Fund operation and financial reporting - --------------------------------------------------------------------------------------------------------
The following policies and procedures govern the ways in which the Audit Committee will pre-approve audit and various types of non-audit services that the Auditor provides to the Trusts and to Service Affiliates. These policies and procedures do not apply in the case of audit services that the Auditor provides to Service Affiliates, nor do they apply to services that an audit firm other than the Auditor provides to such entities. - -------------------------------------------------------------------------------- 1 The Audit Committee also is permitted to ratify the provision of inadvertent non-audit services, BUT ONLY IF: o the value of all such services do not exceed 5% of total revenues paid by the Fund, the Adviser and Service Affiliates to the Auditor in the fiscal year when services are provided; 2 o the services were not recognized as non-audit services at the time they were provided; and o the services are promptly brought to the attention of the Audit Committee and approved prior to the completion of the audit. 2 A list of Service Affiliates is set out in Exhibit I, attached hereto. These policies and procedures comply with the requirements for pre-approval, but also provide a mechanism by which management of the Trusts may request and secure pre-approval of audit and non-audit services in an orderly manner with minimal disruption to normal business operations. Pre-approval of non-audit services may be achieved through a combination of the procedures described in Sections II and VI below. II. Delegation As contemplated by the Act and applicable SEC rules, the Audit Committee hereby delegates to the Chairperson of the Audit Committee the authority to approve the engagement of the independent auditor to provide non-audit services as permitted by the Act, to the extent that such non-audit services are not pre-approved by the entire Audit Committee as set forth herein. The Chairman shall report, for informational purposes only, any pre-approval decisions to the Audit Committee at its next scheduled meeting. III. Audit Services The annual Audit services engagement scope and terms will be subject to the specific pre-approval of the Audit Committee. Audit services include the annual financial statement audit (including required rating agency reviews) and other procedures required to be performed by the independent auditor to be able to form an opinion on the Trusts' financial statements. The Audit Committee will monitor the Audit services engagement throughout the year and will also approve, if necessary, any changes in terms and conditions resulting from changes in audit scope, Fund structure or other items. The Audit Committee will pre-approve all Audit services for the Trusts. IV. Audit-related Services Audit-related services are assurance and related services that are reasonably related to the performance of the audit or review of the Trusts' financial statements or that are traditionally performed by the Auditor. The Audit Committee will pre-approve all Audit-related services for the Trusts. V. Tax Services Tax services to the Trusts include tax compliance, tax planning and tax advice. The Audit Committee will review all proposed tax related services to assure that their provision would not impair the independence of the Auditor. The Audit Committee will pre-approve all tax services for the Trusts. VI. All Other Services The Audit Committee believes, based on the SEC's rules prohibiting the independent auditor from providing specific non-audit services, 3 that other types of non-audit services are permitted. Accordingly, the Audit Committee believes it may pre-approve those permissible non-audit services classified as All Other Services that it believes would not impair the independence of the auditor, and are consistent with the SEC's rules on auditor independence. The Audit Committee will pre-approve all other services for the Trusts. - -------------------------------------------------------------------------------- 3 A list of specific prohibited non-audit services is set out in Exhibit II, attached hereto. VII. Procedures Annually, the Audit Committee will review and approve the types of services to be provided by the Auditor and review the projected fees for the next fiscal year at a regularly scheduled meeting. That approval will acknowledge that the Audit Committee is in agreement with the specific types of services that the Auditor will be permitted to perform. If subsequent to the annual approval by the Audit Committee, the Funds' or the Trusts or any Service Affiliate seeks to engage the Auditor to perform a service that was not approved, the Auditor, upon learning of such proposed engagement, should submit the proposed engagement to the Trusts' [Treasurer or the Adviser] and if the service fits within the independence guidelines, the [Treasurer or the Adviser] will arrange for a discussion of the service to be included on the agenda for the next regularly scheduled Audit Committee meeting so that specific approval can be obtained. If the timing of the project is critical and the project needs to commence before the regularly scheduled meeting, the specific pre-approval by the Chairperson of the Audit Committee must be obtained before any services are provided. The [Treasurer or the Adviser] will arrange this. The Auditor must not commence any such project until specific approval has been given. VIII. Recordkeeping The Trusts shall maintain a written record of all decisions made by the Audit Committee or by the Chairperson of the Audit Committee pursuant to these procedures, together with appropriate supporting material. In connection with the ratification of any inadvertent non-audit services, a record shall be made indicating that each of the conditions for this exception to the pre-approval requirement has been satisfied. 4 IX. Amendment The Audit Committee may review and amend these policies and procedures from time to time as it deems appropriate. Exhibit I STI CLASSIC FUNDS/STI CLASSIC VARIABLE TRUST Service Affiliates Subject to Pre-Approval of Non-Audit Services o Trusco Capital Management, Inc. o SunTrust Banks, Inc. o SunTrust Securities Inc. o SunTrust Robinson Humphrey o [any other affiliates that provide services to the Trusts] - -------------------------------------------------------------------------------- 4 See footnote 1 herein. Exhibit II STI CLASSIC FUNDS/STI CLASSIC VARIABLE TRUST Prohibited Non-Audit Services o Bookkeeping or other services related to the accounting records or financial statements of the audit client o Financial information systems design and implementation o Appraisal or valuation services, fairness opinions or contribution-in-kind reports o Actuarial services o Internal audit outsourcing services o Management functions o Human resources o Broker-dealer, investment adviser or investment banking services o Legal services o Expert services unrelated to the audit (e)(2) Percentage of fees billed applicable to non-audit services pursuant to waiver of pre-approval requirement were as follows: --------------------------------------------------------------- 2004 2003 --------------------------------------------------------------- Audit-Related Fees 0 % 0 % --------------------------------------------------------------- Tax Fees 0 % 0 % --------------------------------------------------------------- All Other Fees 0 % 0 % --------------------------------------------------------------- (f) Not applicable. (g) The aggregate non-audit fees and services billed by PWC for the last two fiscal years were $1,855,277 and $1,498,453 for 2004 and 2003, respectively. (h) The audit committee of the registrant's Board of Trustees reviewed and considered whether the provision of non-audit services that were rendered to the registrant's investment adviser, and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant, that were not pre-approved pursuant to paragraph (c)(7) (ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant's independence. ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS. Not applicable. ITEM 6. SCHEDULE OF INVESTMENTS. Not applicable. ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. Not applicable. ITEM 8. PURCHASERS OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT COMPANY AND AFFILIATED PURCHASERS. Not applicable. ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. Not applicable. ITEM 10. CONTROLS AND PROCEDURES. (a) The certifying officers, whose certifications are included herewith, have evaluated the registrant's disclosure controls and procedures within 90 days of the filing date of this report. In their opinion, based on their evaluation, the registrant's disclosure controls and procedures are adequately designed, and are operating effectively to ensure, that information required to be disclosed by the registrant in the reports it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms. (b) There were no changes in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year that have materially affected, or are reasonably likely to materially affect, the registrants internal control over financial reporting. ITEMS 11. EXHIBITS. (a)(1) Code of Ethics attached hereto. (a)(2) A separate certification for the principal executive officer and the principal financial officer of the registrant as required by Rule 30a-2(a) under the Investment Company Act of 1940, as amended (17 CFR 270.30a-2(a)), are filed herewith. (b) Officer certifications as required by Rule 30a-2(b) under the Investment Company Act of 1940, as amended (17 CFR 270.30a-2(b)) also accompany this filing as an exhibit. - -------------------------------------------------------------------------------- SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. (Registrant) STI Classic Funds By (Signature and Title)* /s/ James F. Volk ------------------------------------- James F. Volk, President Date 07/26/04 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By (Signature and Title)* /s/ James F. Volk ------------------------------------- James F. Volk, President Date 07/26/04 By (Signature and Title)* /s/ Jennifer E. Spratley ------------------------------------- Jennifer E. Spratley, Treasurer & CFO Date 07/26/04 * Print the name and title of each signing officer under his or her signature. EX-99.CODE ETH 2 stiinstlmmcodeofethics.txt STICLASSICB&MCODEOFETHICS5_04 STI CLASSIC FUNDS STI CLASSIC VARIABLE TRUST FINANCIAL OFFICER CODE OF ETHICS I. INTRODUCTION The reputation and integrity of the STI Classic Funds and STI Classic Variable Trust (the "Trusts") are valuable assets that are vital to the Trusts' success. The Trusts' senior financial officers ("SFOs") are responsible for conducting the Trusts' business in a manner that demonstrates a commitment to the highest standards of integrity. The Trusts' SFOs include the principal executive officer, the principal financial officer, comptroller or principal accounting officer, and any person who performs a similar function. The Sarbanes-Oxley Act of 2002 (the "Act") effected sweeping corporate disclosure and financial reporting reform on public companies, including mutual funds, to address corporate malfeasance and assure investors that the companies in which they invest are accurately and completely disclosing financial information. Under the Act, all public companies (including the Trust) must either have a code of ethics for their SFOs, or disclose why it does not. The Act was intended to foster corporate environments which encourage employees to question and report unethical and potentially illegal business practices. The Trusts have chosen to adopt this Financial Officer Code of Ethics (the "Code") to encourage their SFOs to act in a manner consistent with the highest principles of ethical conduct. II. PURPOSES OF THE CODE The purposes of this Code are: o To promote honest and ethical conduct by the Trusts' SFOs, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships; o To assist the Trusts' SFOs in recognizing and avoiding conflicts of interest, including disclosing to an appropriate person any material transaction or relationship that reasonably could be expected to give rise to such a conflict; o To promote full, fair, accurate, timely, and understandable disclosure in reports and documents that the Trusts file with, or submit to, the SEC and in other public communications made by the Trusts; o To promote compliance with applicable laws, rules and regulations; o To encourage the prompt internal reporting to an appropriate person of violations of this Code; and o To establish accountability for adherence to this Code. 1 III. QUESTIONS ABOUT THIS CODE The Trusts' compliance officer designated to oversee compliance with the Trusts' Code of Ethics adopted pursuant to Rule 17j-1 shall serve as Compliance Officer for the implementation and administration of this Code. You should direct your questions about this Code to the Compliance Officer. IV. CONDUCT GUIDELINES The Trusts have adopted the following guidelines under which the Trusts' SFOs must perform their official duties and conduct the business affairs of the Trusts. 1. ETHICAL AND HONEST CONDUCT IS OF PARAMOUNT IMPORTANCE. The Trusts' SFOs must act with honesty and integrity and avoid violations of this Code, including the avoidance of actual or apparent conflicts of interest with the Trusts in personal and professional relationships. 2. SFOS MUST DISCLOSE MATERIAL TRANSACTIONS OR RELATIONSHIPS. The Trusts' SFOs must disclose to the Compliance Officer any actual or apparent conflicts of interest the SFO may have with the Trusts that reasonably could be expected to give rise to any violations of this Code. Such conflicts of interest may arise as a result of material transactions or business or personal relationships to which the SFO may be a party. If it is not possible to disclose the matter to the Compliance Officer, it should be disclosed to the Trusts' Chief Financial Officer, Chief Executive Officer or another appropriate person. In addition to disclosing any actual or apparent conflicts of interest in which an SFO is personally involved, the Trusts' SFOs have an obligation to report any other actual or apparent conflicts which they discover or of which they otherwise become aware. If you are unsure whether a particular fact pattern gives rise to a conflict of interest, or whether a particular transaction or relationship is "material," you should bring the matter to the attention of the Compliance Officer. 3. STANDARDS FOR QUALITY OF INFORMATION SHARED WITH SERVICE PROVIDERS OF THE TRUSTS. The Trusts' SFOs must at all times seek to provide information to the Trusts' service providers (adviser, administrator, outside auditor, outside counsel, custodian, ETC.) that is accurate, complete, objective, relevant, timely, and understandable. 4. STANDARDS FOR QUALITY OF INFORMATION INCLUDED IN PERIODIC REPORTS. The Trusts' SFOs must at all times endeavor to ensure full, fair, timely, accurate, and understandable disclosure in the Trusts' periodic reports. 5. COMPLIANCE WITH LAWS. The Trusts' SFOs must comply with the federal securities laws and other laws and rules applicable to the Trusts, such as the Internal Revenue Code. 2 6. STANDARD OF CARE. The Trusts' SFOs must at all times act in good faith and with due care, competence and diligence, without misrepresenting material facts or allowing your independent judgment to be subordinated. The Trusts' SFOs must conduct the affairs of the Trusts in a responsible manner, consistent with this Code. 7. CONFIDENTIALITY OF INFORMATION. The Trusts' SFOs must respect and protect the confidentiality of information acquired in the course of their professional duties, except when authorized by the Trusts to disclose it or where disclosure is otherwise legally mandated. You may not use confidential information acquired in the course of your work for personal advantage. 8. SHARING OF INFORMATION AND EDUCATIONAL STANDARDS. The Trusts' SFOs should share information with relevant parties to keep them informed of the business affairs of the Trusts, as appropriate, and maintain skills important and relevant to the Trusts' needs. 9. PROMOTE ETHICAL CONDUCT. The Trusts' SFOs should at all times proactively promote ethical behavior among peers in your work environment. 10. STANDARDS FOR RECORDKEEPING. The Trusts' SFOs must at all times endeavor to ensure that the Trusts' financial books and records are thoroughly and accurately maintained to the best of their knowledge in a manner consistent with applicable laws and this Code. V. WAIVERS OF THIS CODE You may request a waiver of a provision of this Code by submitting your request in writing to the Compliance Officer for appropriate review. For example, if a family member works for a service provider that prepares the Trusts' financial statements, you may have a potential conflict of interest in reviewing those statements and should seek a waiver of this Code to review the work. An executive officer of the Trusts, or another appropriate person (such as a designated Board or Audit Committee member), will decide whether to grant a waiver. All waivers of this code must be disclosed to the Trusts' shareholders to the extent required by SEC rules. VI. AFFIRMATION OF THE CODE Upon adoption of the Code, the Trusts' SFOs must affirm in writing that they have received, read and understand the Code, and annually thereafter must affirm that they have complied with the requirements of the Code. To the extent necessary, the Trusts' Compliance Officer will provide guidance on the conduct required by this Code and the manner in which violations or suspected violations must be reported and waivers must be requested. 3 VII. REPORTING VIOLATIONS In the event that an SFO discovers or, in good faith, suspects a violation of this Code, the SFO MUST immediately report the violation or suspected violation to the Compliance Officer. The Compliance Officer may, in his or her discretion, consult with another member of the Trusts' senior management or the Board in determining how to address the suspected violation. For example, a Code violation may occur when a periodic report or financial statement of the Trusts omits a material fact, or is technically accurate but, in the view of the SFO, is written in a way that obscures its meaning. SFOs who report violations or suspected violations in good faith will not be subject to retaliation of any kind. Reported violations will be investigated and addressed promptly and will be treated as confidential to the extent possible. VIII. VIOLATIONS OF THE CODE Dishonest or unethical conduct or conduct that is illegal will constitute a violation of this Code, regardless of whether this Code specifically refers to such particular conduct. A violation of this Code may result in disciplinary action, up to and including removal as an SFO of the Trust. A variety of laws apply to the Trusts and their operations, including the Securities Act of 1933, the Investment Company Act of 1940, state laws relating to duties owed by Trust officers, and criminal laws. The Trusts will report any suspected criminal violations to the appropriate authorities, and will investigate, address and report, as appropriate, non-criminal violations. ADOPTED: NOVEMBER 20, 2003 4 EX-99.CERT 3 stiinstlmm302cert_jv.txt STICLASSICINSTB&MCERTJV5_04 CERTIFICATION Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 I, James F. Volk, certify that: 1. I have reviewed this report on Form N-CSR of STI Classic Funds; 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) 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) [intentionally left blank]; (c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and (d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: 07/26/04 /s/ James F. Volk - ----------------- James F. Volk President EX-99.CERT 4 stiinstlmm302cert_js.txt STICLASSICINST302CERTJS5_04 CERTIFICATION Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 I, Jennifer E. Spratley, certify that: 1. I have reviewed this report on Form N-CSR of STI Classic Funds; 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) 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) [intentionally left blank]; (c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and (d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: 07/26/04 /s/ Jennifer E. Spratley - ------------------------ Jennifer E. Spratley Treasurer & CFO EX-99.906 5 stiinstlmm906cert_jv.txt STICLASSICINSTB&MCERTJV5_04 CERTIFICATION Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 The undersigned, the PRESIDENT of STI CLASSIC FUNDS (the "Fund"), with respect to the Form N-CSR for the period ended MAY 31, 2004 as filed with the Securities and Exchange Commission, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, hereby certifies that, to the best of my knowledge: 1. such Form N-CSR 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 such Form N-CSR fairly presents, in all material respects, the financial condition and results of operations of the Fund. Dated: 07/26/04 /s/ James F. Volk ----------------- James F. Volk EX-99.906 6 stiinstlmm906cert_js.txt STICLASSICINSTB&MCERTJS5_04 CERTIFICATION Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 The undersigned, the CFO of STI CLASSIC FUNDS (the "Fund"), with respect to the Form N-CSR for the period ended MAY 31, 2004 as filed with the Securities and Exchange Commission, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, hereby certifies that, to the best of my knowledge: 1. such Form N-CSR 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 such Form N-CSR fairly presents, in all material respects, the financial condition and results of operations of the Fund. Dated: 07/26/04 /s/ Jennifer E. Spratley ------------------------ Jennifer E. Spratley -----END PRIVACY-ENHANCED MESSAGE-----