-----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, BvXsCy8aNyOzImGP11/ziTLNbqa1IOzddVbX8cAYVTv1YzjtmiH10BLumhDEZldp VG8L7UMcy1nltNb9Q2dVhA== 0000950147-00-000666.txt : 20000505 0000950147-00-000666.hdr.sgml : 20000505 ACCESSION NUMBER: 0000950147-00-000666 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20000229 FILED AS OF DATE: 20000504 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ADVISORS SERIES TRUST CENTRAL INDEX KEY: 0001027596 STANDARD INDUSTRIAL CLASSIFICATION: [] STATE OF INCORPORATION: DE FISCAL YEAR END: 1130 FILING VALUES: FORM TYPE: N-30D SEC ACT: SEC FILE NUMBER: 811-07959 FILM NUMBER: 619264 BUSINESS ADDRESS: STREET 1: 2020 E FINANCIAL WAY SUITE 100 CITY: GLENDORA STATE: CA ZIP: 91741 BUSINESS PHONE: 8188521033 MAIL ADDRESS: STREET 1: 2020 E FINANCIAL WAY STREET 2: SUITE 100 CITY: GLENDORA STATE: CA ZIP: 91741 N-30D 1 ANNUAL REPORT FOR YEAR ENDING 2-29-2000 The American Trust Allegiance Fund One Court Street Lebanon, New Hampshire 03766 ANNUAL REPORT FEBRUARY 29, 2000 April, 2000 Dear Fellow Shareholder, We are pleased to send you the American Trust Allegiance Fund's annual report for the twelve months ending February 29, 2000. Asset growth of the Fund has been encouraging with total net assets reaching $36.9 million as of February 29, 2000. The Fund's investment performance continues to be quite competitive, as it ranked in the top 17% of growth mutual funds over the past twelve months according to Lipper Analytic Services, Inc. Based on total return, Lipper ranked the Fund 200 out of 1207 growth funds for the year ending February 29, 2000. In an effort to provide shareholders with more information on the Fund, we established our own website on the Internet, located at www.AllegianceFund.com. Our website is updated each evening with the closing net asset value and on a quarterly basis, investment performance is updated. Our "ticker" symbol for the Fund is "ATAFX" which can also be used to obtain current net asset values. And finally, we remind shareholders that the Fund is now included in many newspapers around the country, including the WALL STREET JOURNAL, and is listed as "AMTRALLEGNC", just before the heading for Am Skandia Funds. Our investment discipline utilizes a "bottom up" approach and our focus continues to be on any changes in the competitive position or the underlying fundamentals of the companies we own, rather than timing the stock market or reacting to perceived valuation levels. Our job is to look through the day to day volatility of the U.S. stock market and track the operating performance of companies in our portfolio. We believe that fundamentals for our companies are quite robust and earnings will be strong overall. However, the extended valuation levels in the U.S. market have been widely discussed and have been apparent to most investors. Again, our job is to keep an eye on the long term potential of our companies. Our research continues to favor predominantly large capitalization, domestic, high quality companies which possess, on average, growth in earnings per share faster than that of the general stock market. In the current market environment, we feel companies that have demonstrated a more predictable, consistent record of growth in earnings per share are the most attractive. Despite inherent shorter term volatility, our research continues to favor companies in the technology sector and consequently, the Fund's portfolio is overweighted, relative to the S&P 500 Index, in this area. We thank you for your support and look forward to helping you achieve your financial goals. /s/ Jeffrey M. Harris Jeffrey M. Harris, CFA /s/ Paul H. Collins Paul H. Collins Remember past performance is not a guarantee of future results. Fund share values and returns fluctuate and investors may have a gain or a loss when shares are redeemed. During the year ended February 29, 2000, fees were waived and expenses advanced to the Fund. AMERICAN TRUST ALLEGIANCE FUND AMERICAN TRUST ALLEGIANCE FUND Comparison of the change in value of a $10,000 investment in the American Trust Allegiance Fund versus the S & P 500 Composite Stock Price Index American Trust S&P 500 Composite Allegiance Fund Stock Price Index --------------- ----------------- 11-Mar-97 $10,000 $10,000 31-Mar-97 $9,210 $9,342 31-May-97 $10,630 $10,497 31-Aug-97 $11,450 $11,175 30-Nov-97 $12,200 $11,927 28-Feb-98 $13,480 $13,149 29-May-98 $13,620 $13,718 31-Aug-98 $12,110 $12,086 30-Nov-98 $15,130 $14,750 28-Feb-99 $17,183 $15,742 31-May-99 $17,842 $16,600 31-Aug-99 $17,893 $16,892 30-Nov-99 $20,765 $17,829 29-Feb-00 $25,942 $17,585 Average Annual Total Return(1) 1 Year..............................50.97% Since Inception (3/11/97)...........37.81% - ---------- (1) Average Annual Total Return represents the average change in account value over the periods indicated. Past performance is not predictive of future performance. * The S&P 500 Composite Stock Price Index is an unmanaged capitalization-weighted index of 500 stocks designed to represent the broad domestic economy. 2 AMERICAN TRUST ALLEGIANCE FUND TOP 10 HOLDINGS AT FEBRUARY 29, 2000 - -------------------------------------------------------------------------------- Analog Devices, Inc. Cisco Systems, Inc. EMC Corporation Intel Corporation JDS Uniphase Corporation Juniper Networks, Inc. Network Appliance, Inc. SDL, Inc. Sun Microsystems, Inc. Texas Instruments, Incorporated 3 AMERICAN TRUST ALLEGIANCE FUND SCHEDULE OF INVESTMENTS AT FEBRUARY 29, 2000 - -------------------------------------------------------------------------------- Shares COMMON STOCKS: 98.59% Market Value - -------------------------------------------------------------------------------- AIR FREIGHT: 1.01% 9,900 Expeditors International of Washington, Inc.......... $ 373,725 ----------- ALUMINUM: 1.78% 9,600 Alcoa Inc............................................ 657,600 ----------- BANKS - MAJOR REGIONAL: 1.56% 6,050 Fifth Third Bancorp.................................. 314,978 4,600 Northern Trust Corporation........................... 259,900 ----------- 574,878 ----------- BROADCAST MEDIA: 1.55% 13,500 Comcast Corporation - Special Class A............... 573,750 ----------- COMMUNICATIONS EQUIPMENT: 7.24% 9,400 Lucent Technologies Inc.............................. 559,300 3,800 Nokia Corporation, ADR, Class A...................... 753,588 8,100 Nortel Networks Corporation.......................... 903,150 9,500 Tellabs, Inc.*....................................... 456,000 ----------- 2,672,038 ----------- COMPUTER HARDWARE: 3.42% 2,500 International Business Machines Corporation.......... 255,000 10,600 Sun Microsystems, Inc.*.............................. 1,009,650 ----------- 1,264,650 ----------- COMPUTER SOFTWARE AND SERVICES: 7.71% 9,700 America Online, Inc.*................................ 572,300 7,450 Microsoft Corporation*............................... 665,844 2,800 Oracle Corporation*.................................. 207,900 5,400 Siebel Systems, Inc.*................................ 748,913 3,300 VERITAS Software Corporation*........................ 652,987 ----------- 2,847,944 ----------- COMPUTERS - NETWORKING: 8.84% 8,910 Cisco Systems, Inc.*................................. 1,177,791 3,750 Juniper Networks, Inc.*.............................. 1,028,672 5,600 Network Appliance, Inc.*............................. 1,057,000 ----------- 3,263,463 ----------- See accompanying Notes to Financial Statements. 4 AMERICAN TRUST ALLEGIANCE FUND SCHEDULE OF INVESTMENTS AT FEBRUARY 29, 2000, CONTINUED - -------------------------------------------------------------------------------- Shares Market Value - -------------------------------------------------------------------------------- COMPUTERS - PERIPHERAL: 2.93% 9,100 EMC Corporation*..................................... $ 1,082,900 ----------- ELECTRICAL EQUIPMENT: 1.98% 7,700 Symbol Technologies, Inc............................. 732,462 ----------- ELECTRONIC COMPONENT: 2.98% 9,300 Flextronics International Ltd.*...................... 566,138 8,150 Solectron Corporation*............................... 533,825 ----------- 1,099,963 ----------- ELECTRONICS - SEMICONDUCTOR: 22.98% 6,400 Analog Devices, Inc.*................................ 1,004,800 4,000 Broadcom Corporation - Class A*...................... 789,500 6,700 Conexant Systems, Inc.*.............................. 658,275 9,400 Intel Corporation.................................... 1,062,200 4,700 JDS Uniphase Corporation*............................ 1,239,625 3,300 SDL, Inc.*........................................... 1,353,000 8,300 Taiwan Semiconductor Manufacturing Co., Ltd., ADR*... 496,444 5,700 Texas Instruments, Incorporated...................... 949,050 9,000 Vitesse Semiconductor Corporation*................... 934,314 ----------- 8,487,208 ----------- ELECTRONICS - SEMICONDUCTOR EQUIPMENT: 3.77% 4,900 Applied Materials, Inc.*............................. 896,394 5,700 Teradyne, Inc.*...................................... 495,900 ----------- 1,392,294 ----------- FINANCIAL - DIVERSIFIED: 1.05% 7,300 Fannie Mae........................................... 386,900 ----------- HOUSEHOLD PRODUCTS: 1.87% 13,250 Colgate-Palmolive Company............................ 691,484 ----------- INSURANCE - BROKERS: 1.42% 6,775 Marsh & McLennan Companies, Inc...................... 524,216 ----------- INSURANCE - MULTILINE: 1.96% 8,178 American International Group, Inc.................... 723,242 ----------- See accompanying Notes to Financial Statements. 5 AMERICAN TRUST ALLEGIANCE FUND SCHEDULE OF INVESTMENTS AT FEBRUARY 29, 2000, CONTINUED - -------------------------------------------------------------------------------- Shares Market Value - -------------------------------------------------------------------------------- MANUFACTURER - DIVERSE: 0.97% 6,900 Illinois Tool Works Inc.............................. $ 356,644 ----------- OIL - INTERNATIONAL: 1.28% 6,300 Exxon Mobil Corporation.............................. 474,469 ----------- OIL AND GAS - DRILL AND EQUIPMENT: 1.92% 9,600 Schlumberger Limited................................. 709,200 ----------- PAPER AND FOREST PRODUCTS: 1.93% 13,900 Weyerhaeuser Company................................. 713,244 ----------- RESTAURANTS: 1.15% 13,500 McDonald's Corporation............................... 426,094 ----------- RETAIL - APPAREL: 2.04% 15,575 The Gap, Inc......................................... 752,467 ----------- RETAIL - BUILDING SUPPLY: 2.09% 13,350 The Home Depot, Inc.................................. 771,797 ----------- RETAIL - DISCOUNTS: 0.90% 15,900 Dollar General Corporation........................... 332,906 ----------- RETAIL - SPECIALTY: 1.31% 17,100 Bed Bath & Beyond Inc.*.............................. 485,212 ----------- SERVICES - DATA PROCESSING: 2.92% 9,400 Automatic Data Processing............................ 409,487 13,350 Paychex, Inc......................................... 668,334 ----------- 1,077,821 ----------- STEEL: 1.45% 10,800 Nucor Corporation.................................... 536,625 ----------- TELECOMMUNICATIONS - CELLULAR: 1.63% 4,400 Nextel Communications, Inc.*......................... 599,775 ----------- See accompanying Notes to Financial Statements. 6 AMERICAN TRUST ALLEGIANCE FUND SCHEDULE OF INVESTMENTS AT FEBRUARY 29, 2000, CONTINUED - -------------------------------------------------------------------------------- Shares Market Value - -------------------------------------------------------------------------------- TELECOMMUNICATIONS - LONG DISTANCE: 3.01% 14,650 MCI WorldCom Incorporated*........................... $ 653,756 9,900 Qwest Communications International Inc.*............. 459,112 ----------- 1,112,868 ----------- TELEPHONE: 1.94% 8,700 BellSouth Corporation................................ 354,525 9,500 SBC Communications Inc............................... 361,000 ----------- 715,525 ----------- Total Common Stocks (Cost $23,086,784)+: 98.59%...... 36,413,364 ----------- SHORT-TERM INVESTMENTS: 0.66% - -------------------------------------------------------------------------------- $242,416 Firstar Stellar Treasury Fund (Cost $242,416)........ 242,416 ----------- Total Investments in Securities (Cost $23,329,200): 99.25%............................................. 36,655,780 Assets in excess of Liabilities: 0.75%............... 276,241 ----------- Total Net Assets: 100.00%............................ $36,932,021 =========== * Non-income producing security. + At February 29, 2000, the cost of securities for Federal tax purposes was $23,332,259. Gross unrealized appreciation and depreciation of securities is as follows: Gross unrealized appreciation........................ $14,227,399 Gross unrealized depreciation........................ (903,878) ----------- Net unrealized appreciation.................. $13,323,521 =========== See accompanying Notes to Financial Statements. 7 AMERICAN TRUST ALLEGIANCE FUND STATEMENT OF ASSETS AND LIABILITIES AT FEBRUARY 29, 2000 - -------------------------------------------------------------------------------- ASSETS Investments in securities, at value (identified cost $23,329,200) ............................................ $36,655,780 Receivables Fund shares sold ........................................... 178,723 Securities sold ............................................ 302,670 Dividends and interest ..................................... 8,629 Deferred Organization Costs .................................... 7,498 Prepaid expenses ............................................... 9,550 ----------- Total assets ............................................ 37,162,850 ----------- LIABILITIES Payables Due to Advisor ............................................. 2,922 Fund shares repurchased .................................... 4,999 Securities purchased ....................................... 205,450 Administration fees ........................................ 5,401 Accrued expenses ............................................... 12,057 ----------- Total liabilities ....................................... 230,829 ----------- NET ASSETS ....................................................... $36,932,021 =========== Net asset value, offering and redemption price per share [$36,932,021 / 1,444,929 shares outstanding; unlimited number of shares (par value $0.01) authorized] ........................ $ 25.56 =========== COMPONENTS OF NET ASSETS Paid-in capital ................................................ $22,606,750 Accumulated net realized gain on investments ................... 998,691 Net unrealized appreciation on investments ..................... 13,326,580 ----------- Net assets ................................................. $36,932,021 =========== See accompanying Notes to Financial Statements. 8 AMERICAN TRUST ALLEGIANCE FUND STATEMENT OF OPERATIONS - FOR THE YEAR ENDED FEBRUARY 29, 2000 - -------------------------------------------------------------------------------- INVESTMENT INCOME Income Dividends ............................................... $ 114,621 Interest ................................................ 43,313 ------------ Total income ...................................... 157,934 ------------ Expenses Advisory fees (Note 3) .................................. 205,744 Administration fees (Note 3) ............................ 43,444 Custodian and accounting fees ........................... 27,872 Transfer agent fees ..................................... 37,644 Audit fees .............................................. 14,503 Registration fees ....................................... 30,575 Miscellaneous ........................................... 2,005 Trustees' fees .......................................... 2,642 Reports to shareholders ................................. 4,011 Legal fees .............................................. 5,987 Insurance ............................................... 2,216 Amortization of deferred organization costs ............. 3,711 ------------ Total expenses ..................................... 380,354 Less: advisory fee waiver (Note 3) ................. (64,883) ------------ Net expenses ....................................... 315,471 ------------ Net investment loss ............................ (157,537) ------------ REALIZED AND UNREALIZED GAIN ON INVESTMENTS Net realized gain from security transactions ................ 1,178,889 Net change in unrealized appreciation on investments ........ 9,654,443 ------------ Net realized and unrealized gain on investments ......... 10,833,332 ------------ Net Increase in Net Assets Resulting from Operations $ 10,675,795 ============ See accompanying Notes to Financial Statements. 9 AMERICAN TRUST ALLEGIANCE FUND
STATEMENTS OF CHANGES IN NET ASSETS - ------------------------------------------------------------------------------------------------------- Year Year Ended Ended February 29, 2000 February 28, 1999 ----------------- ----------------- INCREASE / (DECREASE) IN NET ASSETS FROM OPERATIONS Net investment loss........................................ $ (157,537) $ (52,858) Net realized gain (loss) from security transactions ....... 1,178,889 (94,763) Net change in unrealized appreciation on investments....... 9,654,443 2,552,998 ----------- ----------- Net increase in net assets resulting from operations... 10,675,795 2,405,377 ----------- ----------- DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS Net realized gain on security transactions ................ -- (147,358) ----------- ----------- Total dividends and distributions to shareholders....... -- (147,358) ----------- ----------- CAPITAL SHARE TRANSACTIONS Net increase in net assets derived from net change in outstanding shares (a)............................... 12,926,816 4,711,269 ----------- ----------- Total increase in net assets............................... 23,602,611 6,969,288 NET ASSETS Beginning of year............................................... 13,329,410 6,360,122 ----------- ----------- End of year .................................................. $36,932,021 $13,329,410 =========== ===========
(a) A summary of capital shares transactions is as follows: Year Year Ended Ended February 29, 2000 February 28, 1999 ---------------------- --------------------- Shares Value Shares Value ------ ----- ------ ----- Shares sold .................. 743,011 $14,552,043 384,345 $5,725,856 Shares issued in reinvestment of distributions.............. -- -- 9,895 144,009 Shares redeemed................. (85,249) (1,625,227) (79,048) (1,158,596) ------- ----------- ------- ---------- Net increase .................. 657,762 $12,926,816 315,192 $4,711,269 ======= =========== ======= ========== See accompanying Notes to Financial Statements. 10 AMERICAN TRUST ALLEGIANCE FUND
FINANCIAL HIGHLIGHTS - FOR A CAPITAL SHARE OUTSTANDING THROUGHOUT EACH PERIOD - -------------------------------------------------------------------------------------------------------- Year Year March 11, 1997* Ended Ended through Feb. 29, 2000 Feb. 28, 1999 Feb. 28, 1998 ------------- ------------- ------------- Net asset value, beginning of period.................... $16.93 $13.48 $10.00 ------ ------ ------ Income from investment operations: Net investment loss................................ (0.11) (0.07) (0.03) Net realized and unrealized gain on investments.... 8.74 3.74 3.51 ------ ------ ------ Total from investment operations........................ 8.63 3.67 3.48 ------ ------ ------ Less distributions: From net realized gain............................. 0.00 (0.22) 0.00 ------ ------ ------ Total distributions..................................... 0.00 (0.22) 0.00 ------ ------ ------ Net asset value, end of period.......................... $25.56 $16.93 $13.48 ====== ====== ====== Total return .......................................... 50.97% 27.47% 34.80%+ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (thousands)................... $36,932 $13,329 $6,360 Ratio of expenses to average net assets: Before expense reimbursement....................... 1.75% 2.30% 4.04%** After expense reimbursement........................ 1.45% 1.45% 1.45%** Ratio of net investment loss to average net assets After expense reimbursement........................ (0.73)% (0.57)% (0.42)%** Portfolio turnover rate................................. 39.81% 40.99% 27.65%
*Commencement of operations. **Annualized. + Not Annualized. See accompanying Notes to Financial Statements. 11 AMERICAN TRUST ALLEGIANCE FUND NOTES TO FINANCIAL STATEMENTS FEBRUARY 29, 2000 - -------------------------------------------------------------------------------- NOTE 1 - ORGANIZATION The American Trust Allegiance Fund (the "Fund") is a series of shares of beneficial interest of Advisors Series Trust (the "Trust"), which is registered under the Investment Company Act of 1940 as a diversified, open-end management investment company. The investment objective of the Fund is to seek capital appreciation. The Fund began operations on March 11, 1997. NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES The following is a summary of significant accounting policies consistently followed by the Fund. These policies are in conformity with generally accepted accounting principles. A. SECURITY VALUATION: The Fund's investments are carried at fair value. Securities that are primarily traded on a national securities exchange shall be valued at the last sale price on the exchange on which they are primarily traded on the day of valuation or, if there has been no sale on such day, at the mean between the bid and asked prices. Securities primarily traded in the NASDAQ National Market System for which market quotations are readily available shall be valued at the last sale price on the day of valuation, or if there has been no sale on such day, at the mean between the bid and asked prices. Over-the-counter ("OTC") securities which are not traded in the NASDAQ National Market System shall be valued at the most recent trade price. Securities for which market quotations are not readily available, if any, are valued following procedures approved by the Board of Trustees. Short-term investments are valued at amortized cost, which approximates market value. B. FEDERAL INCOME TAXES: It is the Fund's policy to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Therefore, no federal income tax provision is required. C. SECURITY TRANSACTIONS, DIVIDENDS AND DISTRIBUTIONS: Security transactions are accounted for on the trade date. Dividend income and distributions to shareholders, which are determined in accordance with income tax regulations, are recorded on the ex-dividend date. Realized gains and losses on securities sold are determined on the basis of identified cost. Discounts and premiums on securities purchased are amortized over the life of the respective securities. D. DEFERRED ORGANIZATION COSTS: The Fund has incurred expenses of $18,500 in connection with its organization. These costs have been deferred and are being amortized on a straight-line basis over a period of sixty months from the date the Fund commenced investment operations. E. USE OF ESTIMATES: The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets during the reporting period. Actual results could differ from those estimates. NOTE 3 - INVESTMENT ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES For the year ended February 29, 2000, American Trust Company (the "Advisor") provided the Fund with investment management services under an Investment Advisory Agreement. The Advisor furnished all investment advice, 12 AMERICAN TRUST ALLEGIANCE FUND NOTES TO FINANCIAL STATEMENTS, CONTINUED - -------------------------------------------------------------------------------- office space, facilities, and provides most of the personnel needed by the Fund. As compensation for its services, the Advisor is entitled to a monthly fee at the annual rate of 0.95% based upon the average daily net assets of the Fund. For the year ended February 29, 2000, the Fund incurred $205,744 in Advisory Fees. The Fund is responsible for its own operating expenses. The Advisor has agreed to reduce fees payable to it by the Fund and to pay Fund operating expenses to the extent necessary to limit the Fund's aggregate annual operating expenses to 1.45% of average net assets (the "expense cap"). Any such reductions made by the Advisor in its fees or payment of expenses which are the Fund's obligation are subject to reimbursement by the Fund to the Advisor, if so requested by the Advisor, in subsequent fiscal years if the aggregate amount actually paid by the Fund toward the operating expenses for such fiscal year (taking into account the reimbursement) does not exceed the applicable limitation on Fund expenses. The Advisor is permitted to be reimbursed only for fee reductions and expense payments made in the previous three fiscal years, but is permitted to look back five years and four years, respectively, during the initial six years and seventh year of the Fund's operations. Any such reimbursement is also contingent upon Board of Trustees review and approval at the time the reimbursed is made. Such reimbursement may not be paid prior to the Fund's payment of current ordinary operating expenses. For the year ended February 29, 2000 the Advisor reduced its fees and absorbed Fund expenses in the amount of $64,883; no amounts were reimbursed to the Advisor. Cumulative expenses subject to recapture pursuant to the aforementioned conditions amounted to $239,848 for the Fund at February, 29, 2000. Investment Company Administration, L.L.C. (the "Administrator") acts as the Fund's Administrator under an Administration Agreement. The Administrator prepares various federal and state regulatory filings, reports and returns for the Fund; prepares reports and materials to be supplied to the Trustees; monitors the activities of the Fund's custodian, transfer agent and accountants; coordinates the preparation and payment of the Fund's expenses and reviews the Fund's expense accruals. For its services, the Administrator receives a monthly fee at the following annual rate: Fund asset level Fee rate ---------------- -------- Less than $15 million $30,000 $15 million to less than $50 million 0.20% of average daily net assets $50 million to less than $100 million 0.15% of average daily net assets $100 million to less than $150 million 0.10% of average daily net assets More than $150 million 0.05% of average daily net assets First Fund Distributors, Inc. (the "Distributor") acts as the Fund's principal underwriter in a continuous public offering of the Fund's shares. The Distributor is an affiliate of the Administrator. Certain officers of the Fund are also officers and/or directors of the Administrator and the Distributor. NOTE 4 - PURCHASES AND SALES OF SECURITIES For the year ended February 29, 2000, the cost of purchases and the proceeds from sales of securities, excluding short-term securities, were $21,049,941 and $8,288,323, respectively. 13 REPORT OF INDEPENDENT ACCOUNTANTS - -------------------------------------------------------------------------------- To the Board of Trustees and Shareholders American Trust Allegiance Fund In our opinion, the accompanying statement of assets and liabilities, including the schedule of investments, 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 American Trust Allegiance Fund, series of Advisor Series Trust (the "Fund") at February 29, 2000, and the results of its operations, the changes in its net assets and the financial highlights for the year then ended, in conformity with accounting principles generally accepted in the United States. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Fund's management; our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit of these financial statements in accordance with auditing standards generally accepted in the 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 audit, which included confirmation of securities at February 29, 2000 by correspondence with the custodian and brokers, provides a reasonable basis for the opinion expressed above. The financial statements for the year ended February 28, 1999, including the financial highlights for the periods prior to February 29, 2000, were audited by other independent accountants whose report dated March 26, 1999 expressed an unqualified opinion on those financial statements. PricewaterhouseCoopers LLP New York, New York April 7, 2000 14 CHANGE IN INDEPENDENT ACCOUNTANT - -------------------------------------------------------------------------------- On August 27, 1999, McGladrey & Pullen, LLP ("McGladrey") resigned as independent auditors of the Fund pursuant to an agreement by PricewaterhouseCoopers LLP ("PwC") to acquire McGladrey's investment company practice. The McGladrey partners and professionals serving the Fund at the time of the acquisition joined PwC. The reports of McGladrey on the financial statements of the Fund during the past two fiscal years contained no adverse opinion or disclaimer of opinion, and were not qualified or modified as to uncertainly, audit scope or accounting principles. In connection with its audit for the most recent two fiscal years and through August 27, 1999, there were no disagreements with McGladrey on any matter of accounting principle or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of McGladrey would have caused it to make reference to the subject matter of disagreement in connection with its report. On September 10, 1999, the Fund, with the approval of its Board of Trustees and its Audit Committee, engaged PwC as its independent auditors. 15 ADVISOR American Trust Company One Court Street Lebanon, NH 03766 1-800-788-8806 DISTRIBUTOR First Fund Distributors, Inc. 4455 East Camelback Road, Suite 261E Phoenix, AZ 85018 CUSTODIAN Firstar Institutional Custody Services 425 Walnut Street Cincinnati, OH 45202 TRANSFER AGENT American Data Service, Inc. 150 Motor Parkway, Suite 109 Hauppauge, NY 11788 1-800-385-7003 LEGAL COUNSEL Paul, Hastings, Janofsky & Walker, LLP 345 California Street, 29th Floor San Francisco, CA 94104 AUDITOR PricewaterhouseCoopers LLP 1177 Avenue of the Americas New York, NY 10036 This report is intended for shareholders of the Fund and may not be used as sales literature unless preceded or accompanied by a current prospectus. Past performance results shown in this report should not be considered a representation of future performance. Share price and returns will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Statements and other information herein are dated and are subject to change. -----END PRIVACY-ENHANCED MESSAGE-----