-----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, SBvUssbY37V/3zA6Tn6ZRejaOu3+dAA/ZikoZQXFrNqi6pMUhMDqHWj/1jrRPgG/ ZSP3/2IvmOvHDPrpO2eiuA== 0000867502-00-000001.txt : 20000203 0000867502-00-000001.hdr.sgml : 20000203 ACCESSION NUMBER: 0000867502-00-000001 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19991130 FILED AS OF DATE: 20000127 FILER: COMPANY DATA: COMPANY CONFORMED NAME: WACHOVIA MUNICIPAL FUNDS CENTRAL INDEX KEY: 0000867502 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 251643095 STATE OF INCORPORATION: MA FISCAL YEAR END: 1130 FILING VALUES: FORM TYPE: N-30D SEC ACT: SEC FILE NUMBER: 811-06201 FILM NUMBER: 514507 BUSINESS ADDRESS: STREET 1: FEDERATED INVESTORS TOWER CITY: PITTSBURGH STATE: PA ZIP: 15222-3779 BUSINESS PHONE: 8009944414 MAIL ADDRESS: STREET 1: FEDERATED INVESTORS TOWER CITY: PITTSBURGH STATE: PA ZIP: 15222-3779 FORMER COMPANY: FORMER CONFORMED NAME: BILTMORE MUNICIPAL FUNDS DATE OF NAME CHANGE: 19930611 FORMER COMPANY: FORMER CONFORMED NAME: PASSAGEWAY FUNDS DATE OF NAME CHANGE: 19930611 FORMER COMPANY: FORMER CONFORMED NAME: SCNB PRIVATE LABEL TRUST DATE OF NAME CHANGE: 19901028 N-30D 1 THE WACHOVIA FUNDS Wachovia Equity Fund Wachovia Quantitative Equity Fund Wachovia Growth and Income Fund Wachovia Equity Index Fund Wachovia Special Values Fund Wachovia Emerging Markets Fund Wachovia personal equity fund Wachovia Balanced Fund Wachovia Fixed Income Fund Wachovia Intermediate Fixed Income Fund Wachovia Short-Term Fixed Income Fund the Wachovia municipal funds Wachovia GA Municipal Bond Fund Wachovia NC Municipal Bond Fund Wachovia SC Municipal Bond Fund Wachovia VA Municipal Bond Fund Combined Annual Report November 30, 1999 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Table of Contents - -------------------------------------------------------------------------------- President's Message 1 - -------------------------------------------------- Overview 5 - -------------------------------------------------- Wachovia Equity Fund Information 8 Line Graphs 8 Portfolio of Investments 11 - -------------------------------------------------- Wachovia Quantitative Equity Fund Information 13 Line Graphs 13 Portfolio of Investments 16 - -------------------------------------------------- Wachovia Growth and Income Fund Information 18 Line Graphs 18 Portfolio of Investments 20 - -------------------------------------------------- Wachovia Equity Index Fund Information 22 Line Graphs 22 Portfolio of Investments 24 - -------------------------------------------------- Wachovia Special Values Fund Information 31 Line Graphs 31 Portfolio of Investments 34 - -------------------------------------------------- Wachovia Emerging Markets Fund Information 37 Line Graphs 37 Portfolio of Investments 39 - -------------------------------------------------- Wachovia Personal Equity Fund Information 44 Line Graphs 44 Portfolio of Investments 46 - -------------------------------------------------- Wachovia Balanced Fund Information 48 Line Graphs 48 Portfolio of Investments 51 - -------------------------------------------------- Wachovia Fixed Income Fund Information 56 Line Graphs 56 Portfolio of Investments 59
- -------------------------------------------------------------------------------- Wachovia Intermediate Fixed Income Fund Information 66 Line Graphs 66 Portfolio of Investments 68 - ------------------------------------------------------------ Wachovia Short-Term Fixed Income Fund Information 71 Line Graphs 71 Portfolio of Investments 73 - ------------------------------------------------------------ Wachovia Georgia Municipal Bond Fund Information 74 Line Graphs 74 Portfolio of Investments 76 - ------------------------------------------------------------ Wachovia North Carolina Municipal Bond Fund Information 81 Line Graphs 81 Portfolio of Investments 83 - ------------------------------------------------------------ Wachovia South Carolina Municipal Bond Fund Information 92 Line Graphs 92 Portfolio of Investments 94 - ------------------------------------------------------------ Wachovia Virginia Municipal Bond Fund Information 107 Line Graphs 107 Portfolio of Investments 109 - ------------------------------------------------------------ Notes to Portfolio of Investments 117 - ------------------------------------------------------------ Statements of Assets and Liabilities 118 - ------------------------------------------------------------ Statements of Operations 121 - ------------------------------------------------------------ Statements of Changes in Net Assets 124 - ------------------------------------------------------------ Financial Highlights--Class A Shares 130 - ------------------------------------------------------------ Financial Highlights--Class B Shares 134 - ------------------------------------------------------------ Financial Highlights--Class Y Shares 136 - ------------------------------------------------------------ Combined Notes to Financial Statements 138 - ------------------------------------------------------------ Auditors Report 154 - ------------------------------------------------------------ Officer and Trustees Table 155
- ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- President's Message Dear Shareholder: I am pleased to present the Combined Annual Report to Shareholders for The Wachovia Funds and The Wachovia Municipal Funds. This Report covers the 12-month period from December 1, 1998 through November 30, 1999, and includes commentary by portfolio management, a complete list of fund holdings and the fund's financial statements. The following fund-by-fund highlights cover performance activity in Class A Shares, Class B Shares, and Class Y Shares. It was a continued positive environment for stocks, while bond returns were weak due to the negative impact of rising interest rates. I urge you to read the portfolio manager commentary for additional information about your fund's performance. Fund-by fund performance highlights are as follows. The Wachovia Funds Wachovia Equity Fund pursues growth through a portfolio of blue-chip stocks issued by some of America's largest and best-known companies. In particular, the fund's manager seeks stocks issued by companies that are both undervalued and have good growth opportunities. At the end of the reporting period, the fund's extensive stock holdings included such well-known names as AT&T, American Express, DuPont, Exxon, General Electric, Intel, Microsoft, Time Warner and Wal-Mart. Fund net assets reached $351.8 million at the end of the reporting period.
Total Return* Income Capital Gains Based on NAV Distributions Distributions Share Price Change ------------- ------------- ------------- ------------------ Class A Share 24.31% $0.07 $1.89 $15.91 to $17.42 Class B Shares 23.37% $0.00** $1.89 $15.87 to $17.32 Class Y Shares 24.52% $0.11 $1.89 $15.92 to $17.42
Wachovia Quantitative Equity Fund pursues growth and income by investing in a portfolio of stocks issued by large, established companies across the entire industrial spectrum. On the last day of the reporting period, the portfolio included quality names like Anheuser-Busch, DuPont, Ford, Home Depot, Intel, J.P. Morgan, Merck, Pepsi Co, Procter & Gamble, and Sprint. Fund net assets ended the reporting period at $712.2 million.
Total Return* Income Capital Gains Based on NAV Distributions Distributions Share Price Change ------------- ------------- ------------- ------------------ Class A Shares 16.60% $0.11 $2.43 $20.29 to $21.00 Class B Shares 15.85% $0.00 $2.43 $20.23 to $20.91 Class Y Shares 16.97% $0.16 $2.43 $20.31 to $21.04
Wachovia Growth and Income Fund pursues total return through growth of capital and income. At the end of the reporting period, the fund's holdings included such names as America Online, AT&T, Bank of America, Colgate-Palmolive, General Motors, IBM, Johnson & Johnson, and Wal-Mart. Fund net assets totaled $349.6 million at the end of the reporting period.
Total Return* Based on NAV Income Capital Gains Share Price Change ------------- ------ ------------- ------------------ Class A Shares 20.40% $0.08 $2.89 $23.54 to $24.86 Class Y Shares 20.73% $0.14 $2.89 $23.55 to $24.88
Wachovia Equity Index Fund pursues a total return that approximates that of the Standard & Poor's 500 Index--a classic benchmark of stock market performance.*** As a result, the fund's extensive portfolio contained a "who's who" of well-known, quality American companies. Fund net assets increased substantially to reach $544.6 million at the end of the reporting period.
Total Return* Income Capital Gains Based on NAV Distributions Distributions Share Price Change ------------- ------------- ------------- ------------------ Class A Shares 19.97% $0.26 $0.37 $22.41 to $26.18 Class Y Shares 20.24% $0.32 $0.37 $22.44 to $26.21
*Performance quoted represents past performance and is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. **Less than $0.01 per share. ***The Standard & Poor's 500 Index is an unmanaged index comprised of common stocks in industry, transportation, and financial and public utility companies, Investments cannot be made in an index. Wachovia Special Values Fund pursues growth by investing in a diversified portfolio of small-company stocks.* Unlike many other funds that invest in small-company stocks through a high-flying approach, this fund is managed through a highly disciplined approach. Its manager seeks stocks issued by well-capitalized and well-run small companies that are selling at less than their estimated long-term values. The fund's positive returns reflected an improved environment for small cap stocks. At the end of the reporting period, the fund's net assets reached $175.7 million. Class B Shares performance is from March 26, 1999, when it began operation, through November 30, 1999.
Total Return** Income Capital Gains Based on NAV Distributions Distributions Share Price Change -------------- ------------- ------------- ------------------ Class A Shares 5.40% $0.16 $0.75 $16.13 to $16.03 Class B Shares 9.52% $0.00 $0.00 $14.60 to $15.99 Class Y Shares 5.61% $0.20 $0.75 $16.18 to $16.07
Wachovia Emerging Markets Fund pursues growth over the long term by investing in stocks of foreign companies located in emerging market countries.*** The fund's managers use a unique "two-tier, equal weighting" approach to selecting stocks for the fund that offers greater diversification than most emerging market funds, with the opportunity for better protection from unexpected negative developments in any one country. The fund's strong returns reflect a positive environment for international stocks. Fund net assets ended the reporting period at $194.4 million.
Total Return** Income Based on NAV Distributions Share Price Change -------------- ------------- ------------------ Class A Shares 40.07% $0.05 $8.43 to $11.74 Class Y Shares 40.39% $0.07 $8.44 to $11.75
Wachovia Personal Equity Fund, the latest addition to the Wachovia Funds, pursues growth of principal and income by investing in a portfolio of high quality companies. This fund is specifically managed to minimize the unpleasant tax consequence of capital gains distributions through a long-term, buy-and-hold strategy that avoids short-term trading, as well as offsetting or minimizing capital gains by selling securities that have declined in value, have the highest cost basis, or have not met expectations for growth. Fund net assets ended the reporting period at $444.6 million. The following performance is for the period from July 30, 1999, when the fund began operation, through November 30, 1999.
Total Return** Income Based on NAV Distributions Share Price Change -------------- ------------- ------------------ Class A Shares 6.75% $0.01 $10.00 to $10.67 Class Y Shares 6.85% $0.01 $10.00 to $10.68
Wachovia Balanced Fund pursues a popular investment objective--long-term growth and current income--by investing in a quality combination of stocks (60.5% of net assets at the end of the reporting period) and bonds. Bond holdings were diversified across corporate bonds (14.9% of net assets), mortgage-backed securities (13.2% of net assets), U.S. Treasury securities (7.7% of net assets), closed end investment companies (1.8%) and a repurchase agreement (1.5%). At the end of the reporting period, fund assets totaled $650.6 million.
Total Return** Income Capital Gains Based on NAV Distributions Distributions Share Price Change -------------- ------------- ------------- ------------------ Class A Shares 13.95% $0.31 $1.69 $13.72 to $13.45 Class B Shares 13.08% $0.21 $1.69 $13.69 to $13.41 Class Y Shares 14.21% $0.34 $1.69 $13.74 to $13.47
Wachovia Fixed Income Fund pursues a high level of total return from a diversified portfolio of income-producing securities. At the end of the reporting period, the fund's $558.3 million in net assets were invested across government agency securities (39.0%), corporate bonds (26.1%), U.S. Treasury obligations (12.7%), closed-end investment companies (7.3%), asset-backed securities (7.3%), collateralized mortgage obligations (1.9%), foreign bonds (1.9%), a repurchase agreement (1.3%), and corporate notes (1.3%).
Total Return** Income Capital Gains Based on NAV Distributions Distributions Share Price Change -------------- ------------- ------------- ------------------ Class A Shares (0.77%) $0.51 $0.04 $10.14 to $9.52 Class B Shares (1.51%) $0.43 $0.04 $10.14 to $9.52 Class Y Shares (0.53%) $0.53 $0.04 $10.14 to $9.52
*Small cap stocks have historically experienced greater volatility than average. ** Performance quoted represents past performance and is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. *** Foreign investing involves special risks including currency risk, increased volatility of foreign securities, and differences in auditing and other financial standards. Emerging markets economic structures may be less diverse and mature, and their political systems may be less stable than those of established markets. Wachovia Intermediate Fixed Income Fund pursues current income consistent with preservation of capital from a diversified portfolio of intermediate-term income-producing securities. At the end of the reporting period, the fund's $141.7 million in net assets was invested across U.S. government agency securities (32.8%), corporate bonds (32.4%), U.S. Treasury obligations (16.7%), asset-backed securities (6.7%), closed-end investment companies (5.9%), collateralized mortgage obligations (1.3%), and a repurchase agreement (2.9%).
Total Return* Capital Gains Based on NAV Income Distributions Share Price Change ------------- ------ ------------- ------------------ Class A Shares (1.03%) $0.50 $0.20 3$10.38 to $9.57 Class Y Shares (0.77%) $0.53 $0.20 $10.38 to $9.57
Wachovia Short-Term Fixed Income Fund pursues a high level of income from a diversified portfolio that, at the end of the reporting period, consisted primarily of corporate bonds (35.7% of net assets), U.S. government agency obligations, (20.6% of net assets), U.S. Treasury obligations (25.4% of net assets). These short-term, income-producing securities are managed to provide an income stream and cushion shareholders against volatility during periods of interest rate increases. Net assets totaled $48.7 million on the last day of the reporting period.
Total Return* Income Based on NAV Distributions Share Price Change ------------- ------------- ------------------ Class A Shares 2.44% $0.52 $9.92 to $9.63 Class Y Shares 2.70% $0.55 $9.92 to $9.63
The Wachovia Municipal Funds Wachovia Georgia Municipal Bond Fund pursues monthly income exempt from federal regular income tax and Georgia state income tax.+ The fund invests in a portfolio of bonds issued by municipalities across Georgia that are rated A or higher by nationally recognized rating agencies. Total net assets reached $114.2 million on the last day of the reporting period.
Total Return* Income Capital Gains Based on NAV Distributions Distributions Share Price Change ------------- ------------- ------------- ------------------ Class A Shares (2.83%) $0.43 $0.03 $11.38 to $10.61 Class Y Shares (2.59%) $0.45 $0.03 $11.38 to $10.61
Wachovia North Carolina Municipal Bond Fund pursues monthly income exempt from federal regular income tax and North Carolina state income tax.+ At the end of the reporting period, the fund's net assets of $443.2 million were invested in bonds issued by municipalities across North Carolina. All holdings are rated A or higher at the time of purchase by nationally recognized rating agencies.
Total Return* Income Capital Gains Based on NAV Distributions Distributions Share Price Change ------------- ------------- ------------- ------------------ Class A Shares (2.34%) $0.42 $0.06 $11.46 to $10.72 Class Y Shares (2.09%) $0.45 $0.06 $11.46 to $10.72
Wachovia South Carolina Municipal Bond Fund pursues monthly income exempt from federal regular income tax and South Carolina state income tax.+ The fund invests in a portfolio of bonds issued by municipalities across South Carolina that are rated A or higher at the time of purchase by nationally recognized rating agencies. Total net assets reached $348.5 million at the reporting period's end.
Total Return* Income Capital Gains Based on NAV Distributions Distributions Share Price Change ------------- ------------- ------------- ------------------ Class A Shares (2.49%) $0.50 $0.02 $11.36 to $10.57 Class Y Shares (2.24%) $0.52 $0.02 $11.36 to $10.57
*Performance quoted represents past performance and is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. +Income may be subject to the federal alternative minimum tax. Wachovia Virginia Municipal Bond Fund pursues monthly income exempt from federal regular income tax and Virginia state income tax.+ The fund invests in a portfolio of bonds issued by Virginia municipalities that are rated A or higher at the time of purchase by nationally recognized rating agencies. Total net assets reached $137.5 million at the period's end.
Total Return* Income Based on NAV Distributions Share Price Change ------------- ------------- ------------------ Class A Shares (2.01%) $0.45 $10.49 to $9.84 Class Y Shares (1.76%) $0.47 $10.49 to $9.84
Thank you for pursuing your financial goals through the diversification and professional management of the Wachovia Funds. As we begin a new millennium, we renew our commitment to keep you up-to-date on your investment progress through the highest level of service. Sincerely, [logo] John W. McGonigle President January 15, 2000 *Performance quoted represents past performance and is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. +Income may be subject to the federal alternative minimum tax. Total returns for the period adjusted for the sales charge (Class A Shares) or deferred sales charge (Class B Shares) are as follows: Wachovia Equity Fund, Class A Shares, 18.71%; Class B Shares, 18.37% Wachovia Quantitative Equity Fund, Class A Shares, 11.33%; Class B Shares, 10.85% Wachovia Growth & Income Fund, Class A Shares, 14.98% Wachovia Equity Index Fund, Class A Shares, 14.56% Wachovia Special Values Fund, Class A Shares, 0.66%; Class B Shares, 4.52% Wachovia Emerging Markets Fund, Class A Shares, 33.72% Wachovia Personal Equity Fund, Class A Shares, 1.96% Wachovia Balanced Fund, Class A Shares, 8.80%; Class B Shares, 8.18% Wachovia Fixed Income Fund, Class A Shares, (5.26%); Class B Shares, (6.21%) Wachovia Intermediate Fixed Income Fund, Class A Shares, (5.50%) Wachovia Short-Term Fixed Income Fund, Class A Shares, (0.08%) Wachovia Georgia Municipal Bond Fund, Class A Shares, (7.23%) Wachovia North Carolina Municipal Bond Fund, Class A Shares, (6.73%) Wachovia South Carolina Municipal Bond Fund, Class A Shares, (6.91%) Wachovia Virginia Municipal Bond Fund, Class A Shares, (6.38%) - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Overview Equity Market Markets around the world experienced solid returns during 1999 as the revival of Asian economies and the arrival of the euro contributed to growth overseas. In the U.S., the Standard & Poor's 500 Index Common Stocks (the "S&P 500")* delivered a total return in excess of 20 percent for the fifth consecutive year--the first time in history such a streak has continued for such a long period of time. The NASDAQ Composite Index (the "NASDAQ Composite")**, dominated by large technology names, performed very well, returning in excess of 85 percent for the year. The growth style of investing outperformed value investing for the fifth consecutive year as investors continued to focus on innovative companies that deliver on the promise of accelerating growth despite interest rate concerns. Large-capitalization names performed better, on average, than small-cap issues, with the very largest companies delivering the best performances. Only the top two market capitalization deciles delivered results that were higher than the index as a whole, highlighting the fact that the larger companies drove performance. On a sector basis, those S&P 500 sectors that were heavily leveraged to the new knowledge economy delivered exceptional results, while the growth sectors of past years (consumer staples and health care, in particular) struggled with slowing revenue growth and political uncertainties. Wachovia Equity Fund Shareholder: The Wachovia Equity Fund outperformed the benchmark S&P 500 Index behind strong stock selection, especially in technology, financials, and utilities. The technology sector focused on Internet infrastructure, including companies leveraged to bandwidth, storage, and servers. The Fund's financial sector holdings benefited from strong earnings gains and an improving global economy. Despite the rising interest rates, questionable mergers, and warmer weather that drove the utilities index downward, the Fund's stocks performed well. Wachovia Quantitative Equity Fund Shareholder: The Wachovia Quantitative Equity Fund underperformed the benchmark S&P 500 Index in 1999. The increase in the market's volatility more negatively impacted the Fund's stock selection with the value-oriented factors than with the growth-oriented factors. While the index returns were impressive, the lack of market breadth was nearly unprecedented in 1999. The Fund's sector neutral approach weighed down the total return as four of the eleven S&P 500 Sector indices (Health, Transports, Utilities, and Consumer Staples) suffered substantial declines for the year, and were only partially offset with the outperformance in the Technology and Communication Services sectors. The quantitative model has clearly provided discrimination between the best and worst performing stocks over the long term. The Fund's returns should more closely track the market's returns as the breadth widens and the volatility subsides with more rational valuations. Wachovia Growth & Income Fund Shareholder: The Wachovia Growth and Income Fund returned 23.5 percent in 1999, outperforming the S&P 500 by nearly three percentage points. The fund benefited substantially from strong returns in the financial and technology sectors. The Fund's technology sector holdings focused primarily on Internet infrastructure, including companies leveraged to bandwidth, storage, and servers. The Fund's financial sector holdings benefited from strong earnings gains and an improving global economy. * The S&P 500 is a composite index of common stocks in industry, transportation, and financial and public utility companies. In addition, the S&P 500 assumes reinvestment of all dividends paid by stocks listed on the index. Taxes due on any of the distributions are not included, nor are brokerage or other fees calculated in index figures. Investments cannot be made in an index. ** NASDAQ Composite is an unmanaged index that measures all NASDAQ domestic and non-U.S.-based common stocks listed on the NASDAQ Stock Market. Investments cannot be made in an index. Wachovia Equity Index Fund Shareholder: While the equity market performed strongly in 1999, the breadth of the market was narrow, with the larger capitalization companies driving market performance. This pronounced capitalization effect saw the largest 100 companies in the S&P 500 Index significantly outperforming the rest of the market. Growth-style investing outperformed value investing, and those sectors that were connected with the technology based knowledge economy significantly outperformed the growth sectors of past years such as consumer staples and health care. The transportation and utilities sectors struggled with rising oil prices, higher interest rates, and a number of other difficulties. Wachovia Special Values Fund Shareholder: Similar to bio-tech companies of the early 1990's, a promising new profitless corner of the equity market captured investor enthusiasm and attracted capital to the small-cap arena. The IPO market responded with an increasing number of offerings as investor money followed performance. In fact, the result was a record year in the IPO market, with nearly $80 billion being raised. Although the benchmark Russell 2000 Index* posted respectable returns for the year, over half of the stocks currently in the Index are down for the year, with one-fourth being down 30 percent or more. Extraordinary performance by a narrow leadership of names explains the divergence. The Special Values Fund's performance experienced a similar phenomenon, with performance being driven by a relatively small number of names in semiconductors and energy. A cyclical semiconductor rebound and higher oil prices helped fuel returns in these sectors and benefited the Fund substantially. In addition, media/entertainment companies fared well as the group's assets garnered increased investor attention. Value investing rests on the premise of holding businesses that are believed to be trading well below their perceived fair market value. Strong returns occur when other investors realize that a company is, indeed, undervalued. This realization can occur through increased merger/acquisition activity or simply when a stock is discovered in the marketplace and its price rises. Although 1999 was not a year of significant discovery and value realization, the fund did experience a substantial amount of merger activity that benefited performance, with twelve portfolio holdings undergoing merger/acquisition activity. Wachovia Emerging Markets Fund Shareholder: The market recovery that began in the fourth quarter of 1998 continued throughout 1999. Prompt actions taken during the year by central bankers around the globe helped to avert a global recession and formed the basis for the impressive resurgence of emerging markets in 1999. Investor confidence in a growth world economy allowed commodity prices to stabilize and improve, thereby improving the export picture for many emerging countries that had been hit hard by the falling prices of raw materials. The high interest rates that were necessary to defend the value of many currencies began to decline and took pressure off of local economies. Furthermore, the positive side of currency weakness began to show in the improved competitiveness of many industries in global export markets, thus turning what were once trade deficits into trade surpluses. The return of capital flows to these countries meant that many emerging market currencies ultimately strengthened from their undervalued levels, adding significantly to U.S. dollar returns. The Wachovia Emerging Markets Fund performed well during the year despite employing a style that appeared to be out of favor. The fund employs a unique style that emphasizes portfolio diversification, controlling risk by limiting the exposure to any single market to a maximum of ten percent of the portfolio. The net effect of this approach is to have less exposure to the largest markets and more exposure to the smaller markets. In a year in which larger emerging markets outperformed the smaller ones, the fund allocated close to maximum levels in most of the larger markets such as South Korea and Mexico, while getting very strong performance from overweight positions in smaller markets such as Russia and Turkey. The result was performance that was competitive with the averages, while staying true to a style that recognizes that investing heavily in any single emerging market can exceed our clients' risk tolerance. Wachovia Personal Equity Fund Shareholder: The Wachovia Personal Equity Fund was officially launched in August 1999. In its initial stages, the Fund's returns have been driven by strong stock selection in the technology, financial, and utilities sectors. The Fund's technology sector holdings focused primarily on Internet infrastructure, including companies leveraged to bandwidth, storage, and servers, while its financial sector holdings benefited from strong earnings gains and an improving global economy. Despite an environment of rising interest rates, questionable mergers, and warmer weather that drove the utilities index downward, the Fund's utilities holdings performed well. * The Russell 2000 Index is a broadly diversified index consisting of approximately 2,000 capitalization common stocks that can be used to compare the total returns of funds whose portfolios are invested primarily in small capitalization common stocks. Investments cannot be made in an index. Wachovia Balanced Fund Shareholder: The Wachovia Balanced significantly outperformed the Lipper Balanced Funds Average, returning 15.05 percent for the year compared to the Lipper Average return of 8.69 percent. Allocation remained relatively stable throughout the year, with approximately 59 percent in equities, 40 percent in fixed income securities, and a 1 percent cash position. Fixed Income Market With regard to the fixed income component of the fund's portfolio, interest rates increased steadily over the course of 1999, moving higher in ten out of twelve months during the year. Long-term treasuries recorded their worst absolute performance since the government began auctioning them almost 22 years ago. The corporate bond market experienced a year of improving liquidity, generally stable spreads, and higher new issue volume. Most of the 10 percent 1999 increase in corporate volume was over by the end of the 3rd quarter as companies locked in financing before the Y2K conversion. The mortgage market was the best performing major sector in the Lehman Brothers Aggregate Bond Index*, and the only sector to record an absolute positive return for the year, while spreads improved with declining prepayment risk and rising rates. Agency sector spreads ended the year approximately where they began 1999. Allocation remained relatively stable throughout the year, with 59 percent in equities, 40 percent in fixed income securities, and a 1 percent cash position. Wachovia Fixed Income Fund Shareholder: Interest rates increased steadily over the course of 1999, moving higher in ten out of twelve months during the year. Long-term treasuries recorded their worst absolute performance since the government began auctioning them almost 22 years ago. The corporate bond market experienced a year of improving liquidity, generally stable spreads, and higher new issue volume. Most of the 10 percent 1999 increase in corporate volume was over by the end of the 3rd quarter as companies locked in financing before the Y2K conversion. The mortgage market was the best performing major sector in the Lehman Brothers Aggregate Bond Index*, and the only sector to record an absolute positive return for the year, while spreads improved with declining prepayment risk and rising rates. Agency sector spreads ended the year approximately where they began 1999. Wachovia Intermediate Fixed-Income Fund/Short Term Fixed Income Fund Shareholders: For securities maturing inside of 5 years, interest rates increased by 0.60 percent for the 4th quarter of 1999 and 1.75 percent for the year. In fact, rates increased in 10 out of 12 months for 1999, which was driven by strong domestic economic activity, an Asian economic rebound, higher commodity prices, and three Federal Reserve rate increases. Corporate bond yields increased by roughly the same amount as Treasuries and still appear attractive on a relative basis. The expectation is for at least 0.50 percent rate increase by the Fed in the 1st quarter of 2000, and if economic activity remains strong then more rate hikes could follow. Municipal Bond Market Wachovia Georgia Municipal Bond Fund Wachovia North Carolina Municipal Bond Fund Wachovia South Carolina Municipal Bond Fund Wachovia Virginia Municipal Bond Fund The municipal market in 1999 was characterized by a nearly uninterrupted rise in interest rates, the unfortunate consequence being a seemingly relentless decline in bond prices. Early in the year the fund's portfolio manager anticipated a rising interest rate environment and endeavored to respond by taking defensive measures early and often. Primarily, efforts were made to sell longer dated, lower coupon bonds to reinvest into shorter dated, higher coupon bonds. The objective of repositioning the fund into higher income, more defensive bonds was accomplished. Additionally, the fund manager sought to improve credit quality by generally selling lesser quality bonds and replacing them with better quality bonds. These measures served the fund well in the face of a bond year arguably as difficult as any experienced in the past twenty years. * The Lehman Brothers Aggregate Bond Index (LBABI) is an unmanaged index measuring both the capital price changes and income provided by the underlying universe of securities, comprised of U.S. Treasury obligations, U.S. agency obligations, foreign obligations, U.S. investment-grade corporate debt and mortgage-backed obligations. The LBABI is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Equity Fund (Class A Shares) Growth of $10,000 Invested in Wachovia Equity Fund (Class A Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Equity Fund (Class A Shares) (the "Fund") from May 7, 1993 (start of performance) to November 30, 1999 compared to the Standard and Poor's 500 Index (S&P 500).+ [Please see Appendix A1] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * Represents a hypothetical investment of $10,000 in the Fund after deducting the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge = $9,550). The Fund's performance assumes the reinvestment of all dividends and distributions. The S&P 500 has been adjusted to reflect reinvestment of dividends on securities in the index. ** Total returns quoted reflect all applicable sales charges and contingent deferred sales charges. + The S&P 500 is an unmanaged index comprised of common stocks in industry, transportation, and financial and public utility companies. The S&P 500 is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Equity Fund (Class B Shares) Growth of $10,000 Invested in Wachovia Equity Fund (Class B Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Equity Fund (Class B Shares) (the "Fund") from July 23, 1996 (start of performance) to November 30, 1999 compared to the Standard and Poor's 500 Index (S&P 500).+ [Please see Appendix A2] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * Represents a hypothetical investment of $10,000 in the Fund. The ending value reflects a 3.00% contingent deferred sales charge on any redemption less than four years from the purchase date. The maximum contingent deferred sales charge is 5.00% on any redemption less than one year from the purchase date. The Fund's performance assumes the reinvestment of all dividends and distributions. The S&P 500 has been adjusted to reflect reinvestment of dividends on securities in the index. ** Total returns quoted reflect all applicable sales charges and contingent deferred sales charges. + The S&P 500 is an unmanaged index comprised of common stocks in industry, transportation, and financial and public utility companies. The S&P 500 is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Equity Fund (Class Y Shares) Growth of $10,000 Invested in Wachovia Equity Fund (Class Y Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Equity Fund (Class Y Shares) (the "Fund") from July 23, 1996 (start of performance) to November 30, 1999 compared to the Standard and Poor's 500 Index (S&P 500).+ [Please see Appendix A3] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * The Fund's performance assumes the reinvestment of all dividends and distributions. The S&P 500 has been adjusted to reflect reinvestment of dividends on securities in the index. + The S&P 500 is an unmanaged index comprised of common stocks in industry, transportation, and financial and public utility companies. The S&P 500 is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Equity Fund Portfolio of Investments November 30, 1999
Shares Value - ---------------------------------------------------------------------------- Common Stocks--83.8% Basic Materials--3.4% 34,171 Air Products & Chemicals, Inc. $ 1,106,286 23,975 Alcoa, Inc. 1,570,363 11,161 Dow Chemical Co. 1,307,231 15,876 Du Pont (E.I.) de Nemours & Co. 943,630 49,279 Rohm & Haas Co. 1,804,843 84,425 Weyerhaeuser Co. 5,171,031 ------------ Total 11,903,384 ------------ Capital Goods--5.6% 65,974 General Electric Co. 8,576,620 38,388 Ingersoll-Rand Co. 1,859,419 125,366 Tyco International Ltd. 5,022,475 72,649 United Technologies Corp. 4,104,669 ------------ Total 19,563,183 ------------ Communication Services--5.6% 101,413 AT&T Corp. 5,666,451 115,178 (1)MCI Worldcom, Inc. 9,523,781 33,121 (1)Nextel Communications, Inc., Class A 3,283,119 24,020 Vodafone AirTouch PLC, ADR 1,133,444 ------------ Total 19,606,795 ------------ Consumer Cyclicals--5.2% 54,446 Black & Decker Corp. 2,443,264 41,907 Carnival Corp. 1,849,146 18,471 (1)Federated Department Stores, Inc. 869,291 51,997 Lowe's Cos., Inc. 2,590,101 51,327 McGraw-Hill Cos., Inc. 2,909,598 38,917 Nordstrom, Inc. 1,082,379 24,384 Tandy Corp. 1,868,424 81,405 Wal-Mart Stores, Inc. 4,690,963 ------------ Total 18,303,166 ------------ Consumer Staples--8.0% 64,737 (1)AT&T Corp.-Liberty Media Group, Inc., Class A 2,706,816 73,252 CBS Corp. 3,809,104 93,557 CVS Corp. 3,713,043 39,053 (1)Clear Channel Communications, Inc. 3,138,885 80,922 Comcast Corp., Class A 3,656,662 185,889 (1)Kroger Co., Inc. 3,961,759
Shares Value Common Stocks--continued Consumer Staples--continued 96,775 (1)Outback Steakhouse, Inc. $ 2,280,261 78,352 Time Warner, Inc. 4,833,339 ------------ Total 28,099,869 ------------ Energy--4.9% 53,638 BP Amoco PLC, ADR 3,268,566 61,090 Baker Hughes, Inc. 1,542,523 129,792 Conoco, Inc., Class A 3,415,152 68,635 Exxon Corp. 5,443,613 34,494 Schlumberger Ltd. 2,071,796 25,988 Texaco, Inc. 1,583,644 ------------ Total 17,325,294 ------------ Finance--14.0% 37,505 American Express Co. 5,674,975 12,166 American General Corp. 891,920 65,061 American International Group, Inc. 6,717,548 17,753 Associates First Capital Corp., Class A 590,287 42,285 Bank One Corp. 1,490,546 65,852 Bank of America Corp. 3,852,342 30,577 Bank of New York Co., Inc. 1,219,258 41,533 Chase Manhattan Corp. 3,208,424 159,211 Citigroup, Inc. 8,577,493 27,092 Fannie Mae 1,805,005 55,522 Freddie Mac 2,741,399 21,865 First Union Corp. 845,902 25,255 MBIA, Inc. 1,262,750 55,897 MBNA Corp. 1,411,399 19,138 Marsh & McLennan Cos., Inc. 1,504,725 14,472 Merrill Lynch & Co., Inc. 1,166,805 37,942 SunTrust Banks, Inc. 2,651,197 82,463 Wells Fargo Co. 3,834,530 ------------ Total 49,446,505 ------------ Healthcare--9.1% 31,854 Abbott Laboratories 1,210,452 28,228 (1)Amgen, Inc. 1,286,138 69,230 Bristol-Myers Squibb Co. 5,058,117 16,402 Guidant Corp. 820,100 59,630 Johnson & Johnson 6,186,613 33,701 Lilly (Eli) & Co. 2,418,047 54,996 Medtronic, Inc. 2,137,970 59,004 Merck & Co., Inc. 4,631,814
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Equity Fund
Shares Value - ------------------------------------------------------------------- Common Stocks--continued Healthcare--continued 101,676 Pfizer, Inc. $ 3,679,400 17,856 Pharmacia & Upjohn, Inc. 976,500 16,764 Schering Plough Corp. 857,060 30,183 Warner-Lambert Co. 2,707,038 ------------ Total 31,969,249 ------------ Technology--24.0% 70,176 (1)America Online, Inc. 5,100,918 126,230 (1)Cisco Systems, Inc. 11,258,138 2 Computer Associates International, Inc. 130 81,674 (1)EMC Corp. 6,824,884 80,808 Intel Corp. 6,196,964 42,315 International Business Machines Corp. 4,361,090 35,116 (1)JDS Uniphase Corp. 8,032,785 71,535 Lucent Technologies, Inc. 5,226,526 108,726 (1)Microsoft Corp. 9,899,163 25,030 (1)Network Appliance, Inc. 2,945,718 22,292 Nokia Oyj, Class A, ADR 3,080,476 70,233 (1)Sun Microsystems, Inc. 9,288,314 61,420 Texas Instruments, Inc. 5,900,159 71,501 (1)Veritas Software Corp. 6,546,810 ------------ Total 84,662,075 ------------ Transportation--1.0% 37,866 Burlington Northern Santa Fe 1,098,114 148,700 Southwest Airlines Co. 2,425,661 ------------ Total 3,523,775 ------------
Shares or Principal Amount Value Common Stocks--continued Utilities--3.0% 24,736 Burlington Resources, Inc. $ 831,748 36,517 Consolidated Edison Co. 1,259,837 65,538 Duke Energy Corp. 3,321,957 72,078 Enron Corp. 2,743,469 102,366 Southern Co. 2,392,806 ------------ Total 10,549,817 ------------ Total Common Stocks (identified cost $200,599,010) 294,953,112 ------------ U.S.Government Agency--5.7% $20,000,000 (2)Federal National Mortgage Association, Discount Note, 12/10/1999 (identified cost $19,973,700) 19,973,700 ------------ U.S. Treasury Obligation--0.9% 3,100,000 (2)United States Treasury Bill, 12/16/1999 (identified cost $3,094,020) 3,094,020 ------------ Repurchase Agreement (3)--9.7% 34,173,073 Goldman Sachs Group, LP, 5.60%, dated 11/30/1999, due 12/1/1999 (at amortized cost) 34,173,073 ------------ Total Investments (identified cost $257,839,803) $352,193,905 ------------
(See Notes to Portfolios of Investments) - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Quantitative Equity Fund (Class A Shares) Growth of $10,000 Invested in Wachovia Quantitative Equity Fund (Class A Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Quantitative Equity Fund (Class A Shares) (the "Fund") from March 25, 1994 (start of performance) to November 30, 1999 compared to the Standard and Poor's 500 Index (S&P 500).+ [Please see Appendix A4] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * Represents a hypothetical investment of $10,000 in the Fund after deducting the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge = $9,550). The Fund's performance assumes the reinvestment of all dividends and distributions. The S&P 500 has been adjusted to reflect the reinvestment of dividends on securities in the index. ** Total returns quoted reflect all applicable sales charges and contingent deferred sales charges. + The S&P 500 is an unmanaged index comprised of common stocks in industry, transportation, and financial and public utility companies. The S&P 500 is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Quantitative Equity Fund (Class B Shares) Growth of $10,000 Invested in Wachovia Quantitative Equity Fund (Class B Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Quantitative Equity Fund (Class B Shares) (the "Fund") from July 23, 1996 (start of performance) to November 30, 1999 compared to the Standard and Poor's 500 Index (S&P 500).+ [Please see Appendix A5] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * Represents a hypothetical investment of $10,000 in the Fund. The ending value of the Fund reflects a 3.00% contingent deferred sales charge on any redemption less than four years from the purchase date. The maximum contingent deferred sales charge is 5.00% on any redemption less than one year from the purchase date. The Fund's performance assumes the reinvestment of all dividends and distributions. The S&P 500 has been adjusted to reflect the reinvestment of dividends on securities in the index. ** Total returns quoted reflect all applicable sales charges and contingent deferred sales charges. + The S&P 500 is an unmanaged index comprised of common stocks in industry, transportation, and financial and public utility companies. The S&P 500 is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Quantitative Equity Fund (Class Y Shares) Growth of $10,000 Invested in Wachovia Quantitative Equity Fund (Class Y Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Quantitative Equity Fund (Class Y Shares) (the "Fund") from July 23, 1996 (start of performance) to November 30, 1999 compared to the Standard and Poor's 500 Index (S&P 500).+ [Please see Appendix A6] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * The Fund's performance assumes the reinvestment of all dividends and distributions. The S&P 500 has been adjusted to reflect the reinvestment of dividends on securities in the index. + The S&P 500 is an unmanaged index comprised of common stocks in industry, transportation, and financial and public utility companies. The S&P 500 is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Quantitative Equity Fund Portfolio of Investments November 30, 1999
Shares Value - ----------------------------------------------------------- Common Stocks--97.7% Basic Materials--2.9% 60,000 Du Pont (E.I.) de Nemours & Co. $ 3,566,250 220,000 Ecolab, Inc. 7,617,500 80,000 Georgia-Pacific Corp. 3,185,000 100,000 Weyerhaeuser Co. 6,125,000 ------------ Total 20,493,750 ------------ Capital Goods--9.4% 110,000 Ball Corp. 4,090,625 178,000 Corning, Inc. 16,676,375 173,000 General Electric Co. 22,490,000 129,296 Illinois Tool Works, Inc. 8,371,916 95,000 Ingersoll-Rand Co. 4,601,562 240,000 Tyco International Ltd. 9,615,000 25,000 United Technologies Corp. 1,412,500 ------------ Total 67,257,978 ------------ Communication Services--7.8% 70,500 AT&T Corp. 3,939,187 45,000 Alltel Corp. 3,892,500 100,000 Bell Atlantic Corp. 6,331,250 240,000 BellSouth Corp. 11,085,000 85,000 GTE Corp. 6,205,000 326,760 SBC Communications, Inc. 16,971,098 60,000 Sprint Corp. 4,162,500 50,000 U.S. West, Inc. 3,103,125 ------------ Total 55,689,660 ------------ Consumer Cyclicals--7.4% 170,000 Arvin Industries, Inc. 4,515,625 40,000 (1)Best Buy Co., Inc. 2,500,000 120,000 Dayton-Hudson Corp. 8,467,500 50,000 Ford Motor Co. 2,525,000 80,000 Gannett Co., Inc. 5,725,000 25,000 Home Depot, Inc. 1,976,562 70,000 Knight-Ridder, Inc. 3,819,375 245,000 TJX Cos., Inc. 6,415,938 100,000 Times Mirror Co., Class A 6,456,250 175,000 Wal-Mart Stores, Inc. 10,084,375 ------------ Total 52,485,625 ------------ Consumer Staples--10.2% 130,000 Albertsons, Inc. 4,151,875 78,000 Anheuser-Busch Cos., Inc. 5,835,375 40,000 BestFoods 2,192,500
Shares Value Common Stocks--continued Consumer Staples--continued 158,760 CBS Corp. $ 8,255,520 40,000 CVS Corp. 1,587,500 210,000 IBP, Inc. 4,633,125 195,000 PepsiCo, Inc. 6,739,688 192,000 Philip Morris Cos., Inc. 5,052,000 75,000 Procter & Gamble Co. 8,100,000 115,000 Quaker Oats Co. 7,503,750 194,000 (1)Safeway, Inc. 7,153,750 266,000 SUPERVALU Inc. 5,170,375 170,000 SYSCO Corp. 6,470,625 ------------ Total 72,846,083 ------------ Energy--5.8% 100,000 BP Amoco PLC, ADR 6,093,750 40,000 Chevron Corp. 3,542,500 154,200 Exxon Corp. 12,229,987 77,000 Mobil Corp. 8,032,063 180,000 Royal Dutch Petroleum Co., ADR 10,440,000 20,000 Texaco, Inc. 1,218,750 ------------ Total 41,557,050 ------------ Finance--13.9% 24,000 AEGON NV, ADR 2,163,000 200,000 Ambac Financial Group, Inc. 10,900,000 95,000 American General Corp. 6,964,687 30,000 American National Insurance Co. 1,991,250 270,000 AmSouth Bancorporation 6,091,875 75,000 Bank of America Corp. 4,387,500 140,000 Bank of New York Co., Inc. 5,582,500 40,000 CIGNA Corp. 3,290,000 170,000 Chase Manhattan Corp. 13,132,500 420,000 Citigroup, Inc. 22,627,500 20,000 J.P. Morgan & Co., Inc. 2,630,000 47,000 Marsh & McLennan Cos., Inc. 3,695,375 125,000 PNC Bank Corp. 6,968,750 216,600 SouthTrust Corp. 8,406,788 ------------ Total 98,831,725 ------------ Health Care--10.8% 85,000 Abbott Laboratories 3,230,000 120,000 (1)Amgen, Inc. 5,467,500 38,000 Baxter International, Inc. 2,567,375 205,200 Bristol-Myers Squibb Co. 14,992,425 150,000 Guidant Corp. 7,500,000
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Quantitative Equity Fund
Shares Value - ------------------------------------------------------------------- Common Stocks--continued Health Care--continued 75,000 Johnson & Johnson $ 7,781,250 110,000 Lilly (Eli) & Co. 7,892,500 69,200 Merck & Co., Inc. 5,432,200 150,000 Pfizer, Inc. 5,428,125 319,200 Schering Plough Corp. 16,319,100 ------------ Total 76,610,475 ------------ Technology--25.1% 50,000 (1)America Online, Inc. 3,634,375 244,000 (1)Cisco Systems, Inc. 21,761,750 295,000 Comdisco, Inc. 7,116,875 200,000 Computer Associates International, Inc. 13,000,000 135,000 (1)Dell Computer Corp. 5,805,000 279,000 (1)EMC Corp. 23,313,937 90,000 Intel Corp. 6,901,875 128,000 International Business Machines Corp. 13,192,000 215,000 (1)Lexmark International Group, Class A 17,845,000 303,000 Lucent Technologies, Inc. 22,137,938 185,000 (1)Microsoft Corp. 16,843,672 205,000 (1)Sun Microsystems, Inc. 27,111,250 ------------ Total 178,663,672 ------------
Shares or Principal Amount Value Common Stocks--continued Transportation--0.5% 50,000 GATX Corp. $ 1,643,750 40,000 Union Pacific Corp. 1,882,500 ------------ Total 3,526,250 ------------ Utilities--3.9% 230,000 Coastal Corp. 8,107,500 112,500 DQE, Inc. 4,141,406 57,442 Duke Energy Corp. 2,911,591 60,000 Enron Corp. 2,283,750 155,000 GPU, Inc. 4,960,000 65,000 Southern Co. 1,519,375 125,000 Williams Cos., Inc. (The) 4,218,750 ------------ Total 28,142,372 ------------ Total Common Stocks (identified cost $345,624,827) 696,104,640 ------------ U.S. Treasury Obligation--0.3% $ 2,000,000 (2)United States Treasury Bill, 12/16/1999 (identified cost $1,996,142) 1,996,142 ------------ Repurchase Agreement (3)--2.0% 14,096,935 Goldman Sachs Group, LP, 5.60%, dated 11/30/1999, due 12/1/1999 (at amortized cost) 14,096,935 ------------ Total Investments (identified cost $361,717,904) $712,197,717 ------------
(See Notes to Portfolios of Investments) - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Growth and Income Fund (Class A Shares) Growth of $10,000 Invested in Wachovia Growth and Income Fund (Class A Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Growth and Income Fund (Class A Shares) (the "Fund") from January 29, 1993 (start of performance) to November 30, 1999 compared to the Standard and Poor's 500 Index ( S&P 500).+ [Please see Appendix A7] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * Represents a hypothetical investment of $10,000 in the Fund after deducting the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge = $9,550). The Fund's performance assumes the reinvestment of all dividends and distributions. The S&P 500 has been adjusted to reflect the reinvestment of dividends on securities in the index. ** Total returns quoted reflect all applicable sales charges and contingent deferred sales charges. + The S&P 500 is an unmanaged index comprised of common stocks in industry, transportation, and financial and public utility companies. The S&P 500 is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Growth and Income Fund (Class Y Shares) Growth of $10,000 Invested in Wachovia Growth and Income Fund (Class Y Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Growth and Income Fund (Class Y Shares) (the "Fund") from March 29, 1998 (start of performance) to November 30, 1999 compared to the Standard and Poor's 500 Index ( S&P 500).+ [Please see Appendix A8] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * The Fund's performance assumes the reinvestment of all dividends and distributions. The S&P 500 has been adjusted to reflect the reinvestment of dividends on securities in the index. + The S&P 500 is an unmanaged index comprised of common stocks in industry, transportation, and financial and public utility companies. The S&P 500 is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Growth & Income Fund Portfolio of Investments November 30, 1999
Shares Value - ----------------------------------------------------------------------------- Common Stocks--93.8% Basic Materials--3.6% 121,127 Du Pont (E.I.) de Nemours & Co. $ 7,199,486 87,226 Weyerhaeuser Co. 5,342,593 ------------ Total 12,542,079 ------------ Capital Goods--7.0% 81,389 General Electric Co. 10,580,570 177,824 Tyco International Ltd. 7,124,074 118,293 United Technologies Corp. 6,683,555 ------------ Total 24,388,199 ------------ Communication Services--6.3% 50,820 AT&T Corp. 2,839,567 75,000 Alltel Corp. 6,487,500 130,281 (1)MCI Worldcom, Inc. 10,772,610 57,417 (1)Qwest Communications International, Inc. 1,962,944 ------------ Total 22,062,621 ------------ Consumer Cyclicals--7.1% 64,046 (1)Federated Department Stores, Inc. 3,014,165 47,836 Gannett Co., Inc. 3,423,264 33,157 General Motors Corp. 2,387,304 57,960 Lowe's Cos., Inc. 2,887,132 116,433 Marriott International, Inc., Class A 3,791,350 54,149 McGraw-Hill Cos., Inc. 3,069,571 54,711 (1)Tommy Hilfiger Corp. 1,347,258 85,186 Wal-Mart Stores, Inc. 4,908,843 ------------ Total 24,828,887 ------------ Consumer Staples--9.3% 41,631 (1)AT&T Corp.--Liberty Media Group, Inc., Class A 1,740,696 20,644 Anheuser-Busch Cos., Inc. 1,544,429 61,933 CBS Corp. 3,220,516 18,032 CVS Corp. 715,645 47,197 (1)Clear Channel Communications, Inc. 3,793,459 106,510 Colgate-Palmolive Co. 5,844,736 44,176 Comcast Corp., Class A 1,996,203 105,312 PepsiCo, Inc. 3,639,846 70,834 Procter & Gamble Co. 7,650,072 40,094 Time Warner, Inc. 2,473,299 ------------ Total 32,618,901 ------------
Shares Value Common Stocks--continued Energy--6.6% 138,224 Exxon Mobil Corp. $ 10,962,891 112,140 Royal Dutch Petroleum Co., ADR 6,504,120 95,461 Schlumberger Ltd. 5,733,626 ------------ Total 23,200,637 ------------ Finance--16.5% 25,878 American Express Co. 3,915,665 242 American General Corp. 17,742 37,075 American International Group, Inc. 3,827,994 883 Bank of America Corp. 51,655 124,000 Bank of New York Co., Inc. 4,944,500 831 Chase Manhattan Corp. 64,195 204,631 Citigroup, Inc. 11,024,495 185,714 Freddie Mac 9,169,629 155,000 Franklin Resources, Inc. 4,872,812 298 Marsh & McLennan Cos., Inc. 23,430 30,400 Merrill Lynch & Co., Inc. 2,451,000 84,709 Morgan Stanley, Dean Witter & Co. 10,218,023 30,000 Progressive Corp. 2,416,875 680 SunTrust Banks, Inc. 47,515 100,000 Wells Fargo Co. 4,650,000 ------------ Total 57,695,530 ------------ Healthcare--10.1% 153,703 Abbott Laboratories 5,840,714 40,978 Bristol-Myers Squibb Co. 2,993,955 75,489 Johnson & Johnson 7,831,984 114,632 Merck & Co., Inc. 8,998,612 187,654 Schering Plough Corp. 9,593,811 ------------ Total 35,259,076 ------------ Technology--25.6% 49,098 (1)America Online, Inc. 3,568,811 135,589 (1)Cisco Systems, Inc. 12,092,844 100,670 (1)EMC Corp. 8,412,237 102,524 Intel Corp. 7,862,309 64,316 International Business Machines Corp. 6,628,568 96,300 Lucent Technologies, Inc. 7,035,919 104,481 (1)Microsoft Corp. 9,512,669 38,105 Nokia Oyj, Class A, ADR 5,265,635 145,163 (1)Sun Microsystems, Inc. 19,197,807 101,744 Texas Instruments, Inc. 9,773,783 ------------ Total 89,350,582 ------------
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Growth & Income Fund
Shares or Principal Amount Value - ------------------------------------------------------------------------------ Common Stocks--continued Utilities--1.7% 117,752 Duke Energy Corp. $ 5,968,554 ------------ Total Common Stocks (identified cost $171,566,453) 327,915,066 ------------ U.S. Government Agency--2.9% Federal National Mortgage Association--2.9% $10,000,000 Discount Note, 12/10/1999 (identified cost $9,986,850) 9,986,300 ------------
Principal Amount Value U.S. Treasury Obligation--0.4% $ 1,500,000 (2)United States Treasury Bill, 12/16/1999 (identified cost $1,497,106) $ 1,498,140 ------------ (3) Repurchase Agreement--2.9% 10,292,097 Goldman Sachs Group, LP, 5.60%, dated 11/30/1999, due 12/1/1999 (at amortized cost) 10,292,097 ------------ Total Investments (identified cost $193,342,506) $349,691,603 ------------
(See Notes to Portfolios of Investments) - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Equity Index Fund (Class A Shares) Growth of $10,000 Invested in Wachovia Equity Index Fund (Class A Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Equity Index Fund (Class A Shares) (the "Fund") from May 7, 1993 (start of performance) to November 30, 1999 compared to the Standard and Poor's 500 Index (S&P 500).+ [Please see Appendix A9] Past performance is no guarantee of future results. investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * Represents a hypothetical investment of $10,000 in the Fund after deducting the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge = $9,550). The Fund's performance assumes the reinvestment of all dividends and distributions. The S&P 500 has been adjusted to reflect the reinvestment of dividends on securities in the index. ** Total returns quoted reflect all applicable sales charges and contingent deferred sales charges. + The S&P 500 is an unmanaged index comprised of common stocks in industry, transportation, and financial and public utility companies. The S&P 500 is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Equity Index Fund (Class Y Shares) Growth of $10,000 Invested in Wachovia Equity Index Fund (Class Y Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Equity Index Fund (Class Y Shares) (the "Fund") from July 23, 1996 (start of performance) to November 30, 1999 compared to the Standard and Poor's 500 Index (S&P 500).+ [Please see Appendix A10] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * The Fund's performance assumes the reinvestment of all dividends and distributions. The S&P 500 has been adjusted to reflect the reinvestment of dividends on securities in the index. + The S&P 500 is an unmanaged index comprised of common stocks in industry, transportation, and financial and public utility companies. The S&P 500 is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Equity Index Fund Portfolio of Investments November 30, 1999
Shares Value - ------------------------------------------------------------------------- Common Stocks--88.8% Basic Materials--2.5% 9,722 Air Products & Chemicals, Inc. $ 314,750 9,562 Alcan Aluminum, Ltd. 325,108 15,422 Alcoa, Inc. 1,010,141 1,681 Armstrong World Industries, Inc. 56,313 16,579 Barrick Gold Corp. 298,422 2,200 Bemis Co., Inc. 69,300 5,460 (1)Bethlehem Steel Corp. 34,125 2,366 Boise Cascade Corp. 81,923 4,015 Champion International Corp. 222,582 9,298 Dow Chemical Co. 1,089,028 44,105 Du Pont (E.I.) de Nemours & Co. 2,621,491 3,329 Eastman Chemical Co. 129,415 5,435 Ecolab, Inc. 188,187 5,317 Engelhard Corp. 89,392 1,390 (1)FMC Corp. 67,415 6,954 Freeport-McMoRan Copper & Gold, Inc., Class B 109,960 7,392 Georgia-Pacific Corp. 294,294 4,603 Goodrich (B.F.) Co. 103,855 2,638 (1)Grace (W.R.) & Co. 35,943 2,483 Great Lakes Chemical Corp. 82,405 4,225 Hercules, Inc. 100,344 10,041 Homestake Mining Co. 82,838 7,426 Inco Ltd. 136,453 4,457 International Flavors & Fragrances, Inc. 164,073 17,224 International Paper Co. 898,877 4,565 Louisiana-Pacific Corp. 55,921 4,316 Mead Corp. 154,027 26,317 Monsanto Co. 1,110,248 7,024 Newmont Mining Corp. 166,381 3,679 Nucor Corp. 185,560 7,443 PPG Industries, Inc. 435,881 3,771 Phelps Dodge Corp. 196,092 13,753 Placer Dome, Inc. 156,440 1,219 Potlatch Corp. 49,293 6,627 Praxair, Inc. 295,730 2,708 Reynolds Metals Co. 169,419 8,872 Rohm & Haas Co. 324,937 4,227 Sigma-Aldrich Corp. 120,998 2,336 Temple-Inland, Inc. 133,736 3,711 USX-U.S. Steel Group, Inc. 93,935 5,582 Union Carbide Corp. 326,547 4,250 Vulcan Materials Co. 171,063
Shares Value Common Stocks--continued Basic Materials--continued 4,252 Westvaco Corp. $ 128,357 9,879 Weyerhaeuser Co. 605,089 4,661 Willamette Industries, Inc. 192,849 3,884 Worthington Industries, Inc. 62,144 ------------ Total 13,741,281 ------------ Capital Goods--7.2% 23,526 Allied-Signal, Inc. 1,407,149 7,650 (1)Allied Waste Industries, Inc. 62,156 4,884 Avery Dennison Corp. 289,987 1,295 Ball Corp. 48,158 40,942 Boeing Co. 1,670,929 977 Briggs & Stratton Corp. 52,208 15,067 Caterpillar, Inc. 698,732 4,346 Cooper Industries, Inc. 186,606 9,711 Corning, Inc. 909,799 2,883 Crane Co. 52,975 5,139 Crown Cork & Seal Co., Inc. 104,707 5,618 Danaher Corp. 275,984 9,569 Deere & Co. 410,869 8,922 Dover Corp. 386,992 2,999 Eaton Corp. 232,235 18,502 Emerson Electric Co. 1,054,614 8,523 General Dynamics Corp. 439,467 137,650 General Electric Co. 17,894,500 3,989 Grainger (W.W.), Inc. 187,982 5,290 Honeywell, Inc. 592,149 12,629 Illinois Tool Works, Inc. 817,728 6,907 Ingersoll-Rand Co. 334,558 4,360 ITT Industries, Inc. 152,055 3,557 Johnson Controls, Inc. 193,856 13,853 Laidlaw, Inc. 84,850 16,488 Lockheed Martin Corp. 327,699 18,250 Masco Corp. 460,812 1,615 Milacron, Inc. 23,518 1,848 Millipore Corp. 60,637 16,859 Minnesota Mining & Manufacturing Co. 1,611,088 6,500 Molex, Inc. 328,250 344 NACCO Industries, Inc., Class A 16,663 1,742 National Service Industries, Inc. 51,498 2,891 Northrop Grumman Corp. 162,438 6,526 (1)Owens-Illinois, Inc. 156,216 7,147 (1)Pactiv Corp. 73,257
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Equity Index Fund
Shares Value - ------------------------------------------------------------------- Common Stocks--continued Capital Goods--continued 5,205 Pall Corp. $ 121,992 4,575 Parker-Hannifin Corp. 215,311 11,453 Pitney Bowes, Inc. 549,028 8,031 Rockwell International Corp. 398,538 3,504 (1)Sealed Air Corp. 164,688 11,286 (1)Solectron Corp. 929,684 6,206 Textron, Inc. 441,014 6,672 (1)Thermo Electron Corp. 100,080 2,384 Thomas & Betts Corp. 97,744 2,609 Timken Co. 49,897 71,334 Tyco International Ltd. 2,857,818 20,247 United Technologies Corp. 1,143,956 25,378 Waste Management, Inc. 412,393 ------------ Total 39,295,464 ------------ Communication Services--8.5% 134,282 AT&T Corp. 7,503,007 11,978 Alltel Corp. 1,036,097 65,207 Bell Atlantic Corp. 4,128,418 79,869 BellSouth Corp. 3,688,949 5,775 CenturyTel, Inc. 265,650 32,678 (1)Global Crossing Ltd. 1,425,578 40,991 GTE Corp. 2,992,343 77,927 (1)MCI Worldcom, Inc. 6,443,589 25,494 (1)MediaOne Group, Inc. 2,020,399 15,076 (1)NEXTEL Communications, Inc., Class A 1,494,408 6,320 (1)Qualcomm, Inc. 2,289,815 143,604 SBC Communications, Inc. 7,458,433 35,618 Sprint Corp. 2,470,999 17,450 (1)Sprint Corp. (PCS Group) 1,601,038 21,109 U.S. West, Inc. 1,310,077 ------------ Total 46,128,800 ------------ Consumer Cyclicals--8.0% 2,976 American Greetings Corp., Class A 70,122 6,416 (1)AutoZone, Inc. 176,841 5,880 (1)Bed Bath & Beyond, Inc. 183,750 8,560 (1)Best Buy Co., Inc. 535,000 3,691 Black & Decker Corp. 165,634 4,223 Block (H&R), Inc. 181,589 25,712 Carnival Corp. 1,134,542 33,835 (1)Cendant Corp. 560,392 2,496 Centex Corp. 59,280 8,430 Circuit City Stores, Inc. 408,855 8,698 Clorox Co. 387,605 4,599 (1)Consolidated Stores Corp. 72,434
Shares Value Common Stocks--continued Consumer Cyclicals--continued 3,184 Cooper Tire & Rubber Co. $ 47,760 9,094 Costco Cos., Inc. 833,806 1,760 Cummins Engine Co., Inc. 71,280 6,954 Dana Corp. 192,974 18,481 Dayton-Hudson Corp. 1,304,066 23,665 Delphi Automotive Systems Corp. 372,724 3,379 Deluxe Corp. 88,488 4,487 Dillards, Inc., Class A 84,692 9,203 Dollar General Corp. 225,474 5,705 Donnelley (R.R.) & Sons Co. 136,920 3,943 Dow Jones & Co. 239,044 7,020 Dun & Bradstreet Corp. 189,540 9,008 (1)Federated Department Stores, Inc. 423,939 1,458 Fleetwood Enterprises, Inc. 30,618 3,183 Fluor Corp. 133,885 50,829 Ford Motor Co. 2,566,864 1,710 Foster Wheeler Corp. 17,421 11,829 Gannett Co., Inc. 846,513 35,913 Gap (The), Inc. 1,454,476 27,043 General Motors Corp. 1,947,096 7,557 Genuine Parts Co. 194,593 6,548 Goodyear Tire & Rubber Co. 220,995 2,983 Harcourt General, Inc. 98,812 8,242 Hasbro, Inc. 177,718 15,454 Hilton Hotels Corp. 155,506 62,459 Home Depot, Inc. 4,938,165 13,456 IMS Health, Inc. 317,057 11,676 Interpublic Group Cos., Inc. 548,772 1,484 Jostens, Inc. 27,268 20,707 (1)K Mart Corp. 205,776 2,008 Kaufman & Broad Homes Corp. 44,427 3,296 Knight-Ridder, Inc. 179,838 6,645 (1)Kohl's Corp. 479,686 8,260 Leggett & Platt, Inc. 177,074 8,802 Limited, Inc. 373,535 2,713 Liz Claiborne, Inc. 101,568 14,808 Lowe's Cos., Inc. 737,623 10,557 Marriott International, Inc., Class A 343,762 14,271 May Department Stores Co. 479,862 3,779 Maytag Corp. 180,211 2,479 McDermott International, Inc. 21,226 8,266 McGraw-Hill Cos., Inc. 468,579 2,198 Meredith Corp. 83,112 2,816 (1)Navistar International Corp. 104,720 7,211 New York Times Co., Class A 277,173 12,027 Nike, Inc., Class B 553,242
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Equity Index Fund
Shares Value - ----------------------------------------------------------------- Common Stocks--continued Consumer Cyclicals--continued 5,857 Nordstrom, Inc. $ 162,898 15,600 (1)Office Depot, Inc. 173,550 7,536 Omnicom Group, Inc. 664,110 2,279 Owens Corning 35,894 3,282 PACCAR, Inc. 134,972 10,305 Paychex, Inc. 411,556 11,068 Penney (J.C.) Co., Inc. 246,955 2,280 Pep Boys-Manny Moe & Jack 22,088 1,813 Pulte Corp. 36,373 2,371 (1)Reebok International Ltd. 21,339 1,518 Russell Corp. 19,829 16,093 Sears, Roebuck & Co. 550,179 10,832 Service Corp. International 81,917 7,223 Sherwin-Williams Co. 154,843 2,473 Snap-On Inc. 74,808 753 Springs Industries, Inc., Class A 30,120 3,730 Stanley Works 116,096 19,241 (1)Staples, Inc. 452,164 13,533 TJX Cos., Inc. 354,395 5,030 TRW, Inc. 262,503 8,316 Tandy Corp. 637,214 3,343 Times Mirror Co., Class A 215,832 10,577 (1)Toys 'R' Us, Inc. 185,098 9,978 Tribune Co. 479,568 2,420 Tupperware Corp. 43,106 5,038 V.F. Corp. 150,510 186,872 Wal-Mart Stores, Inc. 10,768,499 2,825 (1)Wellpoint Health Networks, Inc. 162,614 3,194 Whirlpool Corp. 194,834 ------------ Total 43,477,788 ------------ Consumer Staples--10.0% 2,315 Alberto-Culver Co., Class B 60,913 17,579 Albertsons, Inc. 561,429 20,076 Anheuser-Busch Cos., Inc. 1,501,936 25,694 Archer-Daniels-Midland Co. 319,569 11,035 Avon Products, Inc. 402,088 11,554 BestFoods 633,304 2,885 Brown-Forman Corp., Class B 180,853 3,635 Brunswick Corp. 79,288 32,151 CBS Corp. 1,671,852 16,381 CVS Corp. 650,121 18,369 Campbell Soup Co. 819,717 13,868 (1)Clear Channel Communications, Inc. 1,114,640 17,764 Coca Cola Enterprises, Inc. 376,375 103,552 Coca-Cola Co. 6,970,344
Shares Value Common Stocks--continued Consumer Staples--continued 24,600 Colgate-Palmolive Co. $ 1,349,925 31,012 Comcast Corp., Class A 1,401,355 20,555 ConAgra, Inc. 495,889 1,537 Coors Adolph Co., Class B 76,466 5,838 Darden Restaurants, Inc. 103,989 86,459 Disney (Walt) Co. 2,410,045 9,261 Fort James Corp. 266,254 7,184 Fortune Brands, Inc. 245,603 12,848 General Mills, Inc. 484,209 46,599 Gillette Co. 1,872,697 1,608 Great Atlantic & Pacific Tea Co., Inc. 40,903 5,304 (1)Harrah's Entertainment, Inc. 146,523 15,209 Heinz (H.J.) Co. 636,877 6,013 Hershey Foods Corp. 295,389 17,026 Kellogg Co. 576,756 22,313 Kimberly-Clark Corp. 1,425,243 34,506 (1)Kroger Co., Inc. 735,409 1,634 Longs Drug Stores Corp. 41,054 16,383 Mattel, Inc. 234,482 56,840 McDonald's Corp. 2,557,800 8,212 (1)Mirage Resorts, Inc. 105,216 13,650 Nabisco Group Holdings Corp. 157,828 11,798 Newell Rubbermaid, Inc. 387,122 62,084 PepsiCo, Inc. 2,145,778 101,363 Philip Morris Cos., Inc. 2,667,114 55,736 Procter & Gamble Co. 6,019,488 5,724 Quaker Oats Co. 373,491 13,515 Ralston Purina Co. 401,227 10,858 Rite Aid Corp. 82,114 20,874 (1)Safeway, Inc. 769,729 37,921 Sara Lee Corp. 919,584 16,559 Seagram Co. Ltd. 721,351 5,862 SUPERVALU, Inc. 113,943 14,034 SYSCO Corp. 534,169 54,171 Time Warner, Inc. 3,341,674 6,407 (1)Tricon Global Restaurants, Inc. 265,891 7,362 UST, Inc. 196,013 24,009 Unilever NV, ADR 1,306,990 29,222 (1)Viacom, Inc., Class B 1,453,795 41,898 Walgreen Co. 1,220,279 5,228 Wendy's International, Inc. 115,343 6,239 Winn-Dixie Stores, Inc. 163,384 4,882 Wrigley (Wm.), Jr. Co. 406,121 ------------ Total 54,606,941 ------------
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Equity Index Fund
Shares Value - ------------------------------------------------------------------- Common Stocks--continued Energy--5.2% 3,796 Amerada-Hess Corp. $ 219,931 4,605 Anadarko Petroleum Corp. 138,726 4,106 Apache Corp. 147,046 3,212 Ashland, Inc. 108,405 13,493 Atlantic Richfield Co. 1,300,388 13,734 Baker Hughes, Inc. 346,784 9,185 Burlington Resources, Inc. 308,846 27,407 Chevron Corp. 2,427,232 26,321 Conoco, Inc., Class B 689,281 102,129 Exxon Corp. 8,100,106 18,469 Halliburton Co. 714,519 2,113 Helmerich & Payne, Inc. 47,807 3,627 Kerr-McGee Corp. 207,646 32,759 Mobil Corp. 3,417,173 14,531 Occidental Petroleum Corp. 318,774 10,696 Phillips Petroleum Co. 511,403 3,522 (1)Rowan Cos., Inc. 60,314 90,076 Royal Dutch Petroleum Co., ADR 5,224,408 22,932 Schlumberger Ltd. 1,377,353 10,082 Sempra Energy 186,517 3,929 Sunoco, Inc. 100,435 22,454 Texaco, Inc. 1,368,291 10,544 Union Pacific Resources Group, Inc. 137,731 10,139 Unocal Corp. 336,488 12,921 USX Corp. 341,599 ------------ Total 28,137,203 ------------ Finance--12.9% 10,716 AON Corp. 382,427 6,275 Aetna, Inc. 342,772 10,850 AFLAC, Inc. 519,444 34,016 Allstate Corp. 890,794 18,991 American Express Co. 2,873,576 10,588 American General Corp. 776,233 64,941 American International Group, Inc. 6,705,158 16,610 AmSouth Bancorporation 374,763 30,356 Associates First Capital Corp., Class A 1,009,337 13,057 BB&T Corp. 419,456 50,040 Bank One Corp. 1,763,910 73,150 Bank of America Corp. 4,279,275 31,953 Bank of New York Co., Inc. 1,274,126 4,793 Bear Stearns Cos., Inc. 195,625 7,804 CIGNA Corp. 641,879 8,265 Capital One Financial Corp. 384,839
Shares Value Common Stocks--continued Finance--continued 35,529 Chase Manhattan Corp. $ 2,744,615 7,445 Chubb Corp. 398,773 7,014 Cincinnati Financial Corp. 234,969 142,108 Citigroup, Inc. 7,656,069 6,534 Comerica, Inc. 346,302 13,609 Conseco, Inc. 275,582 4,699 Countrywide Credit Industries, Inc. 132,159 43,107 Fannie Mae 2,872,004 29,416 Freddie Mac 1,452,415 12,496 Fifth Third Bancorp 874,720 40,709 First Union Corp. 1,574,929 41,437 Firstar Corp. 1,077,362 38,532 Fleet Boston Financial Corp. 1,456,991 10,629 Franklin Resources, Inc. 334,149 2,391 Golden West Financial Corp. 241,342 9,356 Hartford Financial Services Group, Inc. 436,808 20,281 Household International, Inc. 802,367 9,752 Huntington Bancshares, Inc. 270,008 7,344 J.P. Morgan & Co., Inc. 965,736 4,452 Jefferson-Pilot Corp. 302,179 18,671 KeyCorp 504,117 5,322 Lehman Brothers Holdings, Inc. 406,468 8,488 Lincoln National Corp. 353,843 4,776 Loews Corp. 305,664 4,173 MBIA, Inc. 208,650 33,681 MBNA Corp. 850,445 4,600 MGIC Investment Corp. 259,900 11,259 Marsh & McLennan Cos., Inc. 885,239 21,940 Mellon Bank Corp. 799,439 15,350 Merrill Lynch & Co., Inc. 1,237,594 23,816 Morgan Stanley, Dean Witter & Co. 2,872,805 26,888 National City Corp. 670,519 4,665 Northern Trust Corp. 451,630 6,000 PaineWebber Group, Inc. 235,125 12,639 PNC Bank Corp. 704,624 4,400 Price (T. Rowe) Associates 158,400 3,045 Progressive Corp. 245,313 5,948 Providian Financial Corp. 470,636 9,290 Regions Financial Corp. 254,894 4,506 Republic New York Corp. 318,518 5,724 SAFECO Corp. 135,587 6,961 SLM Holding Corp. 345,005 34,584 Schwab (Charles) Corp. 1,312,031 6,730 SouthTrust Corp. 261,208
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Equity Index Fund
Shares Value - ------------------------------------------------------------ Common Stocks--continued Finance--continued 9,452 St. Paul Cos., Inc. $ 285,332 6,742 State Street Corp. 495,116 7,293 Summit Bancorp 237,934 13,350 SunTrust Banks, Inc. 932,831 11,679 Synovus Financial Corp. 233,580 5,442 Torchmark Corp. 172,784 30,485 U.S. Bancorp, Inc. 1,042,206 9,960 UNUM Corp. 324,323 5,716 Union Planters Corp. 243,645 8,517 Wachovia Corp. 659,535 24,921 Washington Mutual, Inc. 722,709 69,182 Wells Fargo Co. 3,216,963 ------------ Total 70,097,705 ------------ Health Care--9.5% 63,751 Abbott Laboratories 2,422,538 2,772 Allergan, Inc. 272,695 3,660 (1)Alza Corp. 158,066 54,916 American Home Products Corp. 2,855,632 42,764 (1)Amgen, Inc. 1,948,435 2,252 Bard (C.R.), Inc. 122,312 2,356 Bausch & Lomb, Inc. 129,138 12,014 Baxter International, Inc. 811,696 10,385 Becton, Dickinson & Co. 282,991 4,713 Biomet, Inc. 149,343 16,505 (1)Boston Scientific Corp. 348,668 83,474 Bristol-Myers Squibb Co. 6,098,819 11,212 Cardinal Health, Inc. 586,528 23,926 Columbia/HCA Healthcare Corp. 651,983 12,656 Guidant Corp. 632,800 17,321 (1)HEALTHSOUTH, Corp. 98,513 7,031 (1)Humana, Inc. 49,217 56,486 Johnson & Johnson 5,860,422 46,195 Lilly (Eli) & Co. 3,314,491 2,997 Mallinckrodt, Inc. 99,650 4,656 (1)Manor Care, Inc. 93,411 11,400 McKesson HBOC, Inc. 266,475 49,078 Medtronic, Inc. 1,907,907 99,156 Merck & Co., Inc. 7,783,746 4,184 PE Corp.-PE Biosystems Group 341,519 163,548 Pfizer, Inc. 5,918,393 21,342 Pharmacia & Upjohn, Inc. 1,167,141 4,840 (1)Quintiles Transnational Corp. 106,783 61,734 Schering Plough Corp. 3,156,151 3,535 (1)St. Jude Medical, Inc. 93,898 13,007 (1)Tenet Healthcare Corp. 290,219 7,373 United Healthcare Corp. 382,935
Shares Value Common Stocks--continued Health Care--continued 35,875 Warner-Lambert Co. $ 3,217,539 412 (1)Water Pik Technologies, Inc. 3,039 4,060 (1)Watson Pharmaceuticals, Inc. 150,981 ------------ Total 51,774,074 ------------ Technology--22.2% 15,064 (1)3Com Corp. 599,736 5,500 (1)ADC Telecommunications, Inc. 293,219 5,520 Adobe System, Inc. 379,155 4,330 (1)Adaptec, Inc. 233,279 6,082 (1)Advanced Micro Devices, Inc. 171,817 4,121 Allegheny Technologies Inc. 103,785 92,940 (1)America Online, Inc. 6,755,576 7,500 (1)Analog Devices, Inc. 430,781 3,617 (1)Andrew Corp. 50,412 6,631 (1)Apple Computer, Inc. 649,009 15,524 (1)Applied Materials, Inc. 1,512,620 1,948 Autodesk, Inc. 57,101 25,781 Automatic Data Processing, Inc. 1,272,937 9,054 (1)BMC Software, Inc. 659,244 7,319 (1)Cabletron Systems, Inc. 167,880 6,010 (1)Ceridian Corp. 129,966 136,682 (1)Cisco Systems, Inc. 12,190,326 3,720 (1)Citrix Systems, Inc. 352,935 71,462 Compaq Computer Corp. 1,746,353 22,611 Computer Associates International, Inc. 1,469,715 6,657 (1)Computer Sciences Corp. 434,369 15,438 (1)Compuware Corp. 521,997 2,930 (1)Comverse Technology, Inc. 354,164 106,542 (1)Dell Computer Corp. 4,581,306 43,261 (1)EMC Corp. 3,614,997 13,608 Eastman Kodak Co. 841,995 20,699 Electronic Data Systems Corp. 1,331,204 6,194 Equifax, Inc. 153,301 18,144 First Data Corp. 784,728 13,130 (1)Gateway 2000, Inc. 1,002,804 7,482 (1)General Instrument Corp. 490,071 42,766 Hewlett-Packard Co. 4,057,424 5,694 Ikon Office Solutions, Inc. 38,079 139,142 Intel Corp. 10,670,452 76,220 International Business Machines Corp. 7,855,424 3,672 (1)KLA-Tencor Corp. 310,513 5,934 (1)LSI Logic Corp. 358,636 5,400 (1)Lexmark International Group, Class A 448,200
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Equity Index Fund
Shares Value - ----------------------------------------------------------------- Common Stocks--continued Technology--continued 127,684 Lucent Technologies, Inc. $ 9,328,912 10,769 Micron Technology, Inc. 722,869 214,174 (1)Microsoft Corp. 19,499,873 25,212 Motorola, Inc. 2,880,471 6,980 (1)National Semiconductor Corp. 296,650 3,000 (1)Network Appliance, Inc. 353,062 55,588 Nortel Networks Corp. 4,113,512 13,990 (1)Novell, Inc. 273,679 60,440 (1)Oracle Corp. 4,098,588 11,035 (1)Parametric Technology Corp. 250,357 10,238 (1)PeopleSoft, Inc. 192,602 1,878 PerkinElmer, Inc. 77,233 1,842 Polaroid Corp. 35,459 14,155 Raytheon Co., Class B 434,382 3,148 Scientific-Atlanta, Inc. 183,568 8,742 (1)Seagate Technology, Inc. 323,454 1,117 Shared Medical Systems Corp. 48,869 7,874 (1)Silicon Graphics, Inc. 74,311 31,974 (1)Sun Microsystems, Inc. 4,228,562 1,988 Tektronix, Inc. 67,592 7,150 (1)Teradyne, Inc. 311,472 1,177 (1)Teledyne Technologies Inc. 10,372 16,320 (1)Tellabs, Inc. 1,058,760 32,758 Texas Instruments, Inc. 3,146,815 11,570 (1)Unisys Corp. 332,638 28,000 Xerox Corp. 757,750 6,700 (1)Xilinx, Inc. 599,650 ------------ Total 120,776,972 ------------ Transportation--0.7% 6,290 (1)AMR Corp. 382,904 19,705 Burlington Northern Santa Fe 571,445 9,169 CSX Corp. 326,073 5,998 Delta Air Lines, Inc. 295,402 12,396 (1)FDX Corp. 522,956 4,920 Kansas City Southern Industries, Inc. 293,047 15,929 Norfolk Southern Corp. 340,482 2,701 Ryder Systems, Inc. 60,941 21,193 Southwest Airlines Co. 345,711 3,222 (1)US Airways Group, Inc. 90,015 10,392 Union Pacific Corp. 489,074 ------------ Total 3,718,050 ------------
Shares Value Common Stocks--continued Utilities--2.1% 8,574 (1)AES Corp. $ 496,756 5,764 Ameren Corp. 199,578 8,038 American Electric Power Co., Inc. 252,192 6,657 Carolina Power & Light Co. 200,542 8,931 Central & South West Corp. 178,620 6,662 Cinergy Corp. 168,632 4,300 CMS Energy Corp. 142,975 8,934 Coastal Corp. 314,924 3,505 Columbia Energy Group 219,939 9,345 Consolidated Edison Co. 322,402 6,269 Constellation Energy Group 184,544 4,026 Consolidated Natural Gas Co. 258,167 6,094 DTE Energy Co. 201,483 8,207 Dominion Resources, Inc. 372,393 15,205 Duke Energy Corp. 770,703 945 Eastern Enterprises 53,629 14,816 Edison International 392,624 9,622 El Paso Energy Corp. 370,447 29,386 Enron Corp. 1,118,505 10,359 Entergy Corp. 285,520 4,100 Florida Progress Corp. 175,275 7,598 FPL Group, Inc. 332,413 9,959 FirstEnergy Corp. 232,169 5,375 GPU, Inc. 172,000 4,802 New Century Energies, Inc. 150,963 7,871 Niagara Mohawk Holdings, Inc. 118,065 2,001 NICOR, Inc. 69,410 6,409 Northern States Power Co. 130,984 1,324 ONEOK, Inc. 35,665 16,068 P G & E Corp. 359,522 6,804 P P & L Resources, Inc. 156,917 8,042 PECO Energy Co. 264,883 1,487 Peoples Energy Corp. 54,647 3,570 Pinnacle West Capital Corp. 118,479 9,187 Public Service Enterprises Group, Inc. 321,545 12,400 Reliant Energy, Inc. 307,675 29,289 Southern Co. 684,630 11,860 Texas Utilities Co. 424,736 6,400 Tosco Corp. 173,200 9,123 Unicom Corp. 291,366 17,969 Williams Cos., Inc. (The) 606,454 ------------ Total 11,685,573 ------------ Total Common Stocks (identified cost $219,457,860) 483,439,851 ------------
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Equity Index Fund
Principal Amount Value - ------------------------------------------------------------------------------ U.S. Government Agency--3.7% $20,000,000 (2)Federal National Mortgage Association, Discount Bond, 12/10/1999 (identified cost $19,973,701) $ 19,972,600 ------------ U.S. Treasury Obligation--0.8% 4,400,000 (2)United States Treasury Bill, 12/16/1999 (identified cost $4,391,520) 4,394,544 ------------
Principal Amount Value (3) Repurchase Agreement--6.9% $37,901,020 Goldman Sachs Group, LP, 5.60%, dated 11/30/1999, due 12/1/1999 (at amortized cost) $ 37,901,020 ------------ Total Investments (identified cost $281,724,101) $545,708,015 ------------
(See Notes to Portfolios of Investments) - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Special Values Fund (Class A Shares) Growth of $10,000 Invested in Wachovia Special Values Fund (Class A Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Special Values Fund (Class A Shares) (the "Fund") from May 7, 1993 (start of performance) to November 30, 1999 compared to the Russell 2000 Small Stock Index (Russell 2000 Index).+ [Please see Appendix A11] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * Represents a hypothetical investment of $10,000 in the Fund after deducting the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge = $9,550). The Fund's performance assumes the reinvestment of all dividends and distributions. The Russell 2000 Index has been adjusted to reflect the reinvestment of dividends on securities in the index. ** Total returns quoted reflect all applicable sales charges and contingent deferred sales charges. + The Russell 2000 Index is an unmanaged capitalization-weighted index consisting of 2,000 small capitalization common stocks. The Russell 2000 Index is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Special Values Fund (Class B Shares) Growth of $10,000 Invested in Wachovia Special Values Fund (Class B Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Special Values Fund (Class B Shares) (the "Fund") from March 26, 1999 (start of performance) to November 30, 1999 compared to the Russell 2000 Small Stock Index (Russell 2000 Index).+ [Please see Appendix A12] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * Represents a hypothetical investment of $10,000 in the Fund. The ending value of the Fund reflects the maximum 5.0% contingent deferred sales charge on any redemption less than one year from the purchase date. The Fund's performance assumes the reinvestment of all dividends and distributions. The Russell 2000 Index has been adjusted to reflect the reinvestment of dividends on securities in the index. ** Total returns quoted reflect all applicable sales charges and contingent deferred sales charges. + The Russell 2000 Index is an unmanaged capitalization-weighted index consisting of 2,000 small capitalization common stocks. The Russell 2000 Index is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Special Values Fund (Class Y Shares) Growth of $10,000 Invested in Wachovia Special Values Fund (Class Y Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Special Values Fund (Class Y Shares) (the "Fund") from July 23, 1996 (start of performance) to November 30, 1999 compared to the Russell 2000 Small Stock Index (Russell 2000 Index).+ [Please see Appendix A13] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * The Fund's performance assumes the reinvestment of all dividends and distributions. The Russell 2000 Index has been adjusted to reflect the reinvestment of dividends on securities in the index. + The Russell 2000 Index is an unmanaged capitalization-weighted index consisting of 2,000 small capitalization common stocks. The Russell 2000 Index is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Special Values Fund Portfolio of Investments November 30, 1999 Shares Value - ---------------- Common Stocks--78.6% Basic Materials--11.1% 90,000 (1)American Pacific Corp. $ 658,125 30,400 Barrick Gold Corp. 547,200 17,500 (1)Bush Boake Allen, Inc. 439,687 59,600 (1)Chase Industries, Inc. 525,225 79,300 Cleveland Cliffs, Inc. 2,319,525 73,300 Deltic Timber Corp. 1,887,475 55,500 Greif Brothers Corp., Class A 1,637,250 64,400 Lafarge Corp. 1,738,800 14,900 NCH Corp. 694,713 108,650 Roanoke Electric Corp. 1,765,563 88,000 Rock-Tenn Co. 1,364,000 48,900 Southdown, Inc. 2,258,569 33,900 Texas Industries, Inc. 1,228,875 92,000 Universal Corp. 2,363,250 ------------ Total 19,428,257 ------------ Capital Goods--10.0% 119,600 Amcast Industrial Corp. 1,674,400 104,600 Ampco-Pittsburgh Corp. 1,287,887 28,000 (1)BFC Construction Corp. 252,000 90,050 Butler Manufacturing Co. 1,930,447 85,900 (1)EMCOR Group, Inc. 1,503,250 10,500 Franklin Electronics, Inc. 752,062 99,300 Granite Construction, Inc. 1,886,700 31,000 (1)Harding Lawson Associates Group 232,500 28,500 Millipore Corp. 935,156 127,400 (1)Morrison Knudsen Corp. 1,106,788 96,450 Smith (A.O.) Corp. 2,121,900 14,000 Smith Investment Co. 861,000 159,558 (1)Supreme Industries, Inc. 1,196,685 95,000 (1)Todd Shipyards Corp. 831,250 29,800 Twin Disc, Inc. 415,338 16,170 Westinghouse Air Brake, Co. 293,081 39,800 World Fuel Services Corp. 318,400 ------------ Total 17,598,844 ------------ Consumer Cyclicals--10.1% 15,800 Allen Organ Co., Class B 601,387 192,700 (1)Barnett, Inc. 1,692,147 81,500 Boston Acoustics, Inc. 1,181,750 63,000 (1)Buckhead America Corp. 374,062 6,000 Capital Southwest Corp. 417,000 62,300 Cavalier Homes, Inc. 268,669 33,100 (1)Coastcast Corp. 430,300
Shares Value Common Stocks--continued Consumer Cyclicals--continued 34,850 Cordiant Communications Group PLC, ADR $ 694,822 12,900 Enesco Group, Inc. 157,219 4,200 Grey Advertising, Inc. 1,454,775 32,750 (1)GTECH Holdings Corp. 687,750 106,300 GP Strategies Corp. 837,112 210,550 Intermet Corp. 2,131,819 137,000 Johns Manville Corp. 1,566,937 145,000 (1)Oneita Industries, Inc. 290 126,400 (1)Racing Champions Corp. 628,050 44,800 Raven Industries, Inc. 638,400 27,600 Russell Corp. 360,525 136,200 (1)SPR, Inc. 612,900 56,700 Skyline Corp. 1,406,869 32,700 (1)Sport-Haley, Inc. 128,756 119,500 Velcro Industries NV 1,568,438 ------------ Total 17,839,977 ------------ Consumer Staples--7.0% 99,000 (1)800-JR Cigar, Inc. 822,937 98,100 (1)Alltrista Corp. 2,109,150 33,300 (1)Ascent Entertainment Group, Inc. 403,762 39,247 (1)Chris Craft Industries, Inc. 2,722,761 23,400 (1)Craig Corp. 140,400 13,000 (1)Emmis Communications, Corp., Class A 1,053,000 30,000 (1)GC Cos., Inc. 845,625 42,000 (1)Lone Star Steakhouse & Saloon, Inc. 316,969 217,450 (1)M & F Worldwide Corp. 1,195,975 33,800 National Presto Industries, Inc. 1,191,450 231,400 (1)Omega Protein Corp. 607,425 55,300 (1)On Command Corp. 832,956 ------------ Total 12,242,410 ------------ Energy--3.6% 26,400 (1)Atwood Oceanics, Inc. 887,700 73,200 Berry Petroleum Co., Class A 1,015,650 68,328 (1)Forest Oil Corp. 781,501 77,000 (1)Global Marine, Inc. 1,179,062
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Special Values Fund
Shares Value - ---------------------------------------------------------------------- Common Stocks--continued Energy--continued 243,150 (1)Kaneb Services, Inc. $ 1,063,781 171,020 (1)(4)Santa Fe Snyder Corp. 1,368,160 ------------ Total 6,295,854 ------------ Finance--21.6% 93,900 Aegis Realty, Inc. 874,444 57,500 Argonaut Group, Inc. 1,329,687 76,400 CNA Surety Corp. 849,950 29,000 Cameron Financial Corp. 366,125 55,800 Capital Re Corp. 767,250 141,600 Charter Municipal Mortgage Acceptance Co. 1,708,050 200,100 (1)Danielson Holding Corp. 1,000,500 11,900 Duff & Phelps Credit Rating 947,537 47,100 Eaton Vance Corp. 1,692,656 71,400 Enhance Financial Services Group, Inc. 1,222,725 46,994 Equity Residential Properties Trust 1,888,571 50,879 Financial Security Assurance Holdings Ltd. 2,687,047 137,800 First Union Real Estate Equity & Mortgage Investments 706,225 88,550 Forest City Enterprises, Inc., Class A 2,197,147 202,500 (1)Healthcare Recoveries, Inc. 658,125 58,631 (1)HomeFed Corp. 28,143 122,500 IPC Holdings Ltd. 2,227,969 66,000 John Nuveen & Co., Inc., Class A 2,466,750 127,000 LaSalle Re Holdings Ltd. 1,524,000 83,500 Leucadia National Corp. 1,821,344 20,300 Liberty Corp. 928,725 101,800 Liberty Financial Cos., Inc. 2,392,300 157,000 Meditrust Cos. 1,030,313 50,500 Merchants Group, Inc. 1,148,875 83,000 (1)Standard Management Corp. 503,188 116,400 Stewart Information Services Corp. 1,571,400 55,000 Unico American Corp. 378,125 43,200 Virginia Capital Bancshares, Inc. 702,000 20,100 White Mountain Insurance Group, Inc. 2,371,800 ------------ Total 37,990,971 ------------
Shares Value Common Stocks--continued Healthcare--2.4% 82,700 (1)America Service Group, Inc. $ 1,147,463 10,000 (1)Astrosystems, Inc. 28,750 60,600 (1)Hanger Orthopedic Group, Inc. 621,150 20,850 (1)Healthcare Services Group, Inc. 166,800 3,500 Mine Safety Appliances Co. 222,250 94,067 (1)Per-Se Technologies, Inc. 711,379 98,500 (1)Sunrise Medical, Inc. 591,000 92,950 (1)Thermotrex Corp. 755,219 ------------ Total 4,244,011 ------------ Technology--9.9% 32,250 (1)4Front Software, International, Inc. 685,312 51,260 (1)Anacomp, Inc. 925,884 13,000 (1)Cypress Semiconductor Corp. 354,250 121,500 (1)ESCO Electronics Corp. 1,177,031 53,400 (1)Eagle Point Software Corp. 287,025 52,700 (1)Electroglas, Inc. 1,500,303 22,000 (1)Exar Corp. 1,069,750 39,300 (1)Kulicke & Soffa Industries, Inc. 1,402,519 36,700 Moore Products Co. 1,236,331 64,200 Nam Tai Electronics, Inc. 818,550 28,500 (1)National Semiconductor Corp. 1,211,250 13,800 (1)Novell, Inc. 269,963 62,000 (1)Parametric Technology Corp. 1,406,625 50,449 (1)Phoenix Technology, Ltd. 725,204 50,000 (1)Remedy Corp. 1,743,750 70,000 (1)Silicon Valley Group, Inc. 1,001,875 132,100 United Industrial Corp. 1,147,619 16,300 (1)Vertex Communications Corp. 346,375 ------------ Total 17,309,616 ------------ Transportation--1.5% 52,500 (1)A.C.L.N. Ltd. 958,125 121,800 (1)Consolidated Freightways Corp. 1,111,425 31,500 (1)Kirby Corp. 578,813 ------------ Total 2,648,363 ------------ Utilities--1.4% 124,600 UGI Corp. 2,437,488 ------------ Total Common Stocks (identified cost $132,199,706) 138,035,791 ------------
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Special Values Fund
Shares or Principal Amount Value - ------------------------------------------------------------------------------- Preferred Stocks--0.9% Consumer Staples--0.5% 151,300 (1)Craig Corp., Pfd., Class A $ 869,975 ------------ Finance--0.4% 52,000 Price Enterprises, Inc., Cumulative Pfd., Series A, $1.40 754,000 ------------ Total Preferred Stocks (identified cost $1,544,693) 1,623,975 ------------ Corporate Bond--0.3% Healthcare--0.3% $ 600,000 Medaphis Corp., Company Guarantee, Series B, 9.50%, 2/15/2005 (identified cost $432,000) 444,000 ------------
Principal Amount or Shares Value U.S. Treasury Obligations--0.3% $ 600,000 United States Treasury Bill, 12/16/1999 (identified cost $598,843) $ 599,256 ------------ Closed-End Investment Company--0.4% 138,400 (1)Royce FocusTrust, Inc. (identified cost $643,560) 666,050 ------------ (3) Repurchase Agreement--19.5% $34,226,952 Goldman Sachs Group, LP, 5.60%, dated 11/30/1999, due 12/1/1999 (at amortized cost) 34,226,952 ------------ Total Investments (identified cost $169,645,754) $175,596,024 ------------
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Emerging Markets Fund (Class A Shares) Growth of $10,000 Invested in Wachovia Emerging Markets Fund (Class A Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Emerging Markets Fund (Class A Shares) (the "Fund") from December 23, 1994 (start of performance) to November 30, 1999 compared to the International Finance Corporation Investable Index (Total Return Series) (IFCI).+ [Please see Appendix A14] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * Represents a hypothetical investment of $10,000 in the Fund after deducting the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge = $9,550). The Fund's performance assumes the reinvestment of all dividends and distributions. The IFCI has been adjusted to reflect the reinvestment of dividends on securities in the index. ** Total returns quoted reflect all applicable sales charges and contingent deferred sales charges. + The IFCI is an unmanaged market capitalization-weighted index of over 1,000 securities in 26 emerging market countries. The IFCI is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Emerging Markets Fund (Class Y Shares) Growth of $10,000 Invested in Wachovia Emerging Markets Fund (Class Y Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Emerging Markets Fund (Class Y Shares) (the "Fund") from July 23, 1996 (start of performance) to November 30, 1999 compared to the International Finance Corporation Investable Index (Total Return Series) (IFCI).+ [Please see Appendix A15] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * The Fund's performance assumes the reinvestment of all dividends and distributions. The IFCI has been adjusted to reflect the reinvestment of dividends on securities in the index. + The IFCI is an unmanaged market capitalization-weighted index of over 1,000 securities in 26 emerging market countries. The IFCI is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Emerging Markets Fund Portfolio of Investments November 30, 1999
Shares Value - ------------------------------------------------------------------------------ Common Stocks--85.4% Argentina--1.8% 34,680 Banco de Galicia y Buenos Aires SA de CV, Class B, ADR $ 708,772 120,000 Compania Naviera Perez Companc SA, Class B 637,296 25,000 Quilmes Industrial SA, ADR 290,625 150,000 Siderca SA, Class A 298,545 50,000 Telecom Argentina SA, ADR 1,468,750 ------------ Total 3,403,988 ------------ Brazil--6.3% 35,000 Aracruz Cellulose, ADR 713,125 15,000 Companhia Brasileira de Distribuicao Groupo Pao de Acucar, ADR 400,312 60,000 Companhia Cervajaria Brahma, ADR 780,000 57,000 Companhia Vale Do Rio Doce 1,101,743 120,000 (1)Embratel Participacoes SA, ADR 2,235,000 23,000 (1)Tele Centro Sul Participacoes SA, ADR 1,569,750 140,000 Tele Norte Leste Participacoes SA, ADR 2,493,750 29,000 (1)Telesp Celular Participacoes SA, ADR 831,938 90,000 Unibanco-Uniao de Bancos Brasileiros SA, GDR 2,120,625 ------------ Total 12,246,243 ------------ Chile--2.0% 30,000 Banco de A. Edwards, ADR 468,750 25,800 Compania Cervecerias Unidas SA, ADR 722,400 47,000 Compania Telecomunicacion de Chile, ADR 863,625 10,000 Cristalerias de Chile, ADR 130,625 25,000 (1)Distribucion y Servicio D&S SA, ADR 443,750 48,542 Gener SA, ADR 749,367 30,000 (1)Quinenco SA, ADR 266,250 10,578 Sociedad Quimica Y Minera de Chile, ADR 300,812 ------------ Total 3,945,579 ------------
Shares Value Common Stocks--continued Croatia--0.7% 90,000 (1)(5)Pliva D.D., GDR $ 1,076,193 33,250 (1)(5)Zagrebacka Banka, GDR 308,394 ------------ Total 1,384,587 ------------ Czech Republic--1.2% 24,100 (1)(5)Ceske Radiokomunikace, GDR 731,257 115,710 Ceska Sporitelna AS 553,630 50,000 (1)SPT Telecom AS 714,625 250,000 (1)Unipetrol 352,427 ------------ Total 2,351,939 ------------ Egypt--1.0% 64,000 (1)Al-Ahram Beverages Co., GDR 1,027,200 50,000 (1)Commercial International Bank Egypt, GDR 615,000 20,000 Suez Cement Co., Class S, GDR 323,000 ------------ Total 1,965,200 ------------ Greece--4.1% 9,124 Alpha Credit Bank SA 732,930 13,875 Commercial Bank of Greece 1,020,987 22,976 Goody's SA 697,406 27,500 Hellenic Bottling Co., SA 657,663 40,000 (1)Hellenic Petroleum SA 596,036 7,800 Hellenic Technodomiki SA 308,504 57,188 Hellenic Telecommunication Organization SA 1,225,626 8,881 National Bank of Greece SA 634,172 25,000 (1)STET Hellas Telecommunications SA, ADR 493,750 16,730 Sarantis SA 646,312 8,700 Titan Cement Co. SA 1,024,298 ------------ Total 8,037,684 ------------ Hong Kong--7.6% 500,000 Amoy Properties Ltd. 386,274 117,000 CLP Holdings Ltd. 545,342 60,000 Cheung Kong 675,980 300,000 (1)China Telecom (Hong Kong) Ltd. 1,603,039 340,000 Citic Pacific Ltd. 921,522 1,600,000 Cosco Pacific Ltd. 1,308,183
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Emerging Markets Fund
Shares Value - ---------------------------------------------------------------- Common Stocks--continued Hong Kong--continued 230,000 Dao Heng Bank Group Ltd. $ 1,311,917 172,900 HSBC Holdings PLC 2,281,884 100,000 Henderson Land Development Co., Ltd. 540,784 55,000 Hong Kong Electric Holdings Ltd. 173,502 100,000 Hutchison Whampoa Ltd. 1,232,859 120,000 Johnson Electric Holdings Ltd. 853,666 348,000 Li & Fung Ltd. 799,820 20,000 Sun Hung Kai Properties Ltd. 182,193 200,000 Swire Pacific Ltd., Class A 1,151,098 125,000 Television Broadcasts Ltd. 812,786 ------------ Total 14,780,849 ------------ Hungary--3.1% 25,354 (1)Antenna Hungaria RT 461,878 15,000 (1)(5)BorsodChem RT, GDR 458,750 15,000 Danubius Hotels RT 260,756 17,000 EGIS RT 532,346 10,000 (1)(5)MOL Magyar Olay, GDR 194,375 80,000 (1)Matav RT, ADR 2,415,000 22,000 OTP Bank RT, GDR 1,038,400 14,000 Pick Szeged RT 522,861 25,000 (1)Synergon Information Systems 183,561 ------------ Total 6,067,927 ------------ India--1.2% 23,800 BSES Ltd., GDR 311,780 18,000 (5)Hindalco Industries Ltd., GDR 427,500 26,500 Indian Hotels Co. Ltd., GDR 225,913 24,500 Larsen & Toubro Ltd., GDR 551,250 22,000 Ranbaxy Laboratories Ltd., GDR 502,700 26,000 (1)(5)Reliance Industries Ltd., GDR 350,350 ------------ Total 2,369,493 ------------ Indonesia--1.7% 770,000 PT Daya Guna Samudera 247,368 225,000 PT Gudang Garam 535,202 1,742,115 PT Indah Kiat Pulp & Paper Corp. 619,207 517,500 PT Indosat 723,368 419,345 PT Semen Gresik 624,861 1,333,800 PT Telekomunikasi Indonesia 569,805 ------------ Total 3,319,811 ------------
Shares Value Common Stocks--continued Israel--2.3% 270,000 Bank Hapoalim Ltd. $ 712,863 560,000 Bank Leumi Le-Israel 1,032,057 2,200 Blue Square Chain Stores Investments & Properties Ltd. 26,950 9,250 Koor Industries Ltd. 916,925 10,500 Matav-Cable Systems Media Ltd., ADR 518,438 18,500 (1)NICE-Systems Ltd., ADR 757,344 9,500 Teva Pharmaceutical Industries Ltd. 525,917 ------------ Total 4,490,494 ------------ Korea, Republic Of--11.0% 42,500 Dongwon Securities 1,195,169 70,000 (1)(5)Housing & Commercial Bank, GDR 1,939,000 49,520 Kookmin Bank 824,443 40,000 Korea Electric Power Corp. 1,587,233 13,000 (1)Korea Telecom, ADR 689,000 40,000 Korean Air Co. Ltd. 546,905 43,118 (1)LG Electronics, Inc., GDR 965,203 19,069 LG Information & Communication Ltd. 2,253,572 12,500 Pohang Iron and Steel Co. Ltd. 1,710,373 237 SK Telecom Co. Ltd. 547,702 16,511 SK Telecom Co. Ltd., ADR 391,104 27,875 Samsung Display Devices Co. Ltd. 1,486,025 25,027 Samsung Electronics Co. 5,181,350 14,650 Samsung Fire & Marine Insurance 650,830 12,000 Shinsegae Department Store Co. 740,134 27,000 Ssangyong Oil Refining Co. 663,791 ------------ Total 21,371,834 ------------ Lithuania--0.2% 50,000 Vilniaus Bankas AB, GDR 300,000 ------------ Malaysia--3.4% 40,200 APM Automotive Holdings Berhad 0 110,000 Genting Berhad 382,105 375,000 Malayan Banking Berhad 1,282,895 150,000 Malaysian International Shipping Berhad 223,026 375,000 Petronas Gas Berhad 759,868 950,000 Public Bank Berhad 950,000
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Emerging Markets Fund
Shares Value - ------------------------------------------------------------------------------- Common Stocks--continued Malaysia--continued 200,000 Resorts World Berhad $ 536,842 100,000 Rothmans of Pall Mall (Malaysia) Berhad 710,526 268,000 Tan Chong Motor Holdings Berhad 114,958 180,000 Tanjong PLC 350,526 165,000 Telekom Malaysia Berhad 521,053 350,000 Tenaga Nasional Berhad 773,684 13,400 Warisan Tc Holdings Berhad 0 ------------ Total 6,605,483 ------------ Mexico--10.5% 150,000 Carso Global Telecom, Class A-1 1,178,219 370,299 Cemex SA de CV 1,811,993 550,000 Cifra SA de CV 969,112 30,000 Coca-Cola Femsa SA, ADR 461,250 260,000 (1)Corporacion GEO, SA de CV, Class B 883,133 20,310 Desc SA de CV, Class C, ADR 350,347 45,000 (1)Fomento Economico Mexicano, SA de CV, ADR 1,704,375 300,000 GPO Continental SA 445,176 249,800 Grupo Carso SA de CV 1,161,367 600,000 Grupo Elektra, SA de CV 401,231 650,000 Grupo Financiero Banamex Accival, SA de CV, Class O 2,190,585 200,000 Grupo Mexico SA, Class B 827,938 35,000 Grupo Televisa SA, GDR 1,708,437 200,000 Kimberly-Clark de Mexico, SA de CV 750,451 90,000 Organizacion Soriana SA de CV, Class B 415,561 55,000 Telefonos de Mexico SA, Class L, ADR 5,090,938 ------------ Total 20,350,113 ------------ Peru--1.3% 448,738 Banco Continental 268,767 35,000 CPT Telefonica del Peru SA, Class B, ADR 452,813 27,721 Cementos Lima SA 434,940 684,685 Cervecer Backus & Johnston, Class T 270,774 45,000 Cia de Minas Buenaventura SA, Class B 371,400 48,721 Credicorp Ltd. 526,187
Shares Value Common Stocks--continued Peru--continued 69,185 Minsur SA $ 144,734 ------------ Total 2,469,615 ------------ Philippines--2.0% 2,167,811 Ayala Land, Inc. 512,872 7,000,000 (1)Belle Corp. 341,463 430,000 Manila Electric Co., Class B 1,101,220 110,880 Metro Bank and Trust Co. 797,795 48,500 Philippine Long Distance Telephone Co., ADR 994,250 7,100,000 Solid Group, Inc. 207,805 ------------ Total 3,955,405 ------------ Poland--1.8% 20,000 (1)Agora SA 204,393 25,000 Bank Handlowy W. Warszawie 358,276 6,500 Bank Slaski SA 369,552 54,756 (1)Budimex SA 322,889 75,000 Elektrim Spolka Akcyina SA 560,320 55,000 KGHM Polska Miedz SA 301,069 25,000 (1)Orbis SA 192,059 15,000 (5)Polski Koncern Naftowy SA, GDR 154,875 15,000 Prokom Software SA, GDR 186,000 8,000 Softbank SA 232,116 50,000 (1)(5)Telekomunikacja Polska SA, GDR 281,250 50,000 WBK (Wielkopolski Bank Kreditowy SA) 279,572 ------------ Total 3,442,371 ------------ Romania--0.1% 15,039 (1)Alro Slatina 80,746 35,000 (1)LaFarge Romcin 68,512 341,254 (1)Sanex SA 10,879 158,826 (1)Terapia SA 39,973 ------------ Total 200,110 ------------ Russia--1.9% 702,000 Aeroflot 58,266 34,142 Kubanelectrosvyaz 200,472 50,000 Lukoil Holding Co. Class B, ADR 1,680,000 30,000 (1)Sun Interbrew Ltd., Class A 30,000 90,000 (1)Sun Interbrew Ltd., Class B 279,000 140,000 Surgutneftegaz 1,326,500 16,000 (1)Udmurt Telecom 9,600 ------------ Total 3,583,838 ------------
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Emerging Markets Fund
Shares Value - -------------------------------------------------------------------------- Common Stocks--continued Slovakia--0.4% 275,000 (1)(5)Slovakofarma AS, GDR $ 776,875 ------------ South Africa--6.9% 75,000 ABSA Group Ltd. 282,836 40,000 ASA Ltd. 765,000 20,000 (1)Anglo American PLC 1,172,453 70,504 Bidvest Group Ltd. 600,228 50,000 (1)DataTec Ltd. 679,777 45,000 De Beers Consolidated Mines, ADR 1,209,375 70,763 Dimension Data Holdings Ltd. 366,499 30,000 Impala Platinum Holdings Ltd. 1,092,498 40,464 Imperial Holdings Ltd. 412,597 90,000 Johnnies Industries Corp. 808,449 30,000 Nedcor Ltd. 549,648 500,000 Profurn Ltd. 493,647 1,000,000 (1)Sanlam Ltd. 1,170,187 100,000 Sappi Ltd. 896,658 100,000 Sasol Ltd. 758,275 225,000 (1)South African Breweries PLC 2,112,163 ------------ Total 13,370,290 ------------ Taiwan, Republic Of China--1.4% 24,446 Advanced Semiconductor Engineering Inc., GDR 545,146 36,685 Asia Cement Corp., GDR 274,979 32,207 (1)GVC Corp., GDR 116,750 24,600 (1)Taiwan Semiconductor Manufacturing Co., ADR 880,988 38,016 (1)Uni-President Enterprises Co., GDR 251,856 76,146 (1)Yageo Corp., GDR 369,308 37,179 (1)Yang Ming Marine Transport, GDR 284,419 ------------ Total 2,723,446 ------------ Thailand--4.4% 220,000 BEC World Public Co., Ltd. 1,354,367 300,000 Bangkok Bank Public Co., Ltd. 642,555 120,000 Electricity Generating PLC 153,905 350,000 Hana Microelectronics Co., Ltd. 1,436,450 135,000 PTT Exploration and Production Public Co. 831,089 328,600 Shin Corp. PLC 2,090,363
Shares Value Common Stocks--continued Thailand--continued 35,000 Siam Cement Co. Ltd. $ 1,016,288 800,000 Thai Farmers Bank Co. 1,077,337 ------------ Total 8,602,354 ------------ Turkey--5.9% 172,443,828 Akbank T.A.S. 2,729,463 29,350,000 Akcansa Cimento AS 441,894 27,840,000 Aksigorta 1,115,072 9,700,000 Alcatel Teletas 1,085,964 15,240,000 Eregli Demir Ve Celik Fabrikalari T.A.S. 426,549 7,745,468 Koc Holding AS 986,750 537,300 Migros Turk 220,390 122,375,000 Sabanci Holding 3,956,610 7,720,000 Tupras Turkiye Petrol Rafinerileri AS 543,909 ------------ Total 11,506,601 ------------ Venezuela--1.2% 50,000 Compania Anonima Nacional Telefonos de Venezuela, Class D, ADR 1,196,875 2,903,032 La Electricidad de Caracas 973,141 70,000 Mavesa SA, ADR 210,000 ------------ Total 2,380,016 ------------ Total Common Stocks (identified cost $132,357,245) 166,002,145 ------------ Preferred Stocks--4.2% Brazil--4.1% 50,000,000 Centrais Eletricas Brasileiras SA, Preference, Series B 1,035,380 55,251,630 Companhia Energetica de Minas Gerais, Preference 1,039,490 120,000,000 Companhia Paranaense de Energia-Copel, Preference, Series B 927,159 65,000,000 Gerdau SA, Preference 1,285,120 14,000,000 Petroleo Brasileiro SA, Preference 2,829,865 66,740 Telecomunicacoes de Minas Gerais, Preference, Series B 2,049 10,000,000 Telecomunicacoes de Sao Paulo SA, Preference 962,539 ------------ Total 8,081,602 ------------
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Emerging Markets Fund
Principal or Shares Value - ------------------------------------------------------------------------------- Preferred Stocks--continued Russia--0.1% 1,540,550 (1)Karelia Electrosvyaz, Pfd. $ 19,257 2,000,000 Surgutneftegaz, Pfd. 110,938 ------------ Total 130,195 ------------ Total Preferred Stocks (identified cost $7,676,535) 8,211,797 ------------ Rights--0.1% Korea, Republic Of--0.1% 3,649 (1)SK Telecom Co. Ltd., Rights 54,045 2,096 (1)Shinsegae Department Store Co., Rights 48,449 ------------ Total 102,494 ------------ Greece--0.0% 7,800 (1)Hellenic Technodomiki, Rights 30,013 ------------ Total Rights (identified cost $0) 132,507 ------------ Warrants--0.0% Indonesia--0.0% 109,374 (1)PT Bank Dagang Nasional Indonesia 0 148,486 (1)PT Bank Internasional Indonesia 20 233,350 (1)PT Bank Pan Indonesia 5,423 163,544 (1)PT Indah Kiat Pulp & Paper Corp. 33,536 ------------ Total 38,979 ------------ Philippines--0.0% 500,000 (1)Belle Corp. 3,537 ------------ Thailand--0.0% 9,375 (1)Thai Farmers Bank Co. 1,996 ------------ Total Warrants (identified cost $12,455) 44,512 ------------ Convertible Bond--0.0% Brazil--0.0% $ 53,500 Companhia Vale do Rio Doce, Conv. Deb., 12/31/1999 (identified cost $417) 278 ------------
Principal or Shares Value Closed-End Investment Companies--6.0% Bulgaria--0.2% 65,000 Framlington Bulgaria Fund $ 284,375 ------------ India--1.7% 35,000 (1)India Fund, Inc. 492,188 10,000 (1)India I.T. Fund 477,500 175,000 (1)The Morgan Stanley India Investment Fund, Inc. 2,362,500 ------------ Total 3,332,188 ------------ Romania--0.5% 2,200 (1)Romania Investment Fund Ltd. 962,500 ------------ South Africa--0.7% 102,457 Southern Africa Fund, Inc. 1,363,959 ------------ Taiwan, Republic Of China--2.8% 90,000 Formosa Growth Fund Ltd. 2,009,700 185,000 (1)ROC Taiwan Fund 1,480,000 110,000 Taiwan Fund, Inc. 2,028,125 ------------ Total 5,517,825 ------------ Ukraine--0.1% 6,667 (1)Societe Generale Ukraine Fund 243,346 ------------ Total Closed-End Investment Companies (identified cost $11,239,866) 11,704,193 ------------ Open-End Investment Company--0.9% United States--0.9% 1,795,485 (1)Bank of New York Cash Reserve Fund (at cost) 1,795,485 ------------ (3) Repurchase Agreement--3.2% $ 6,189,219 Goldman Sachs Group, LP, 5.60%, dated 11/30/1999, due 12/1/1999 (at amortized cost) 6,189,219 ------------ Total Investments (identified cost $159,271,222) $194,080,136 ------------
(See Notes to Portfolios of Investments) - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Personal Equity Fund (Class A Shares) Growth of $10,000 Invested in Wachovia Emerging Markets Fund (Class A Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Personal Equity Fund (Class A Shares) (the "Fund") from July 30, 1999 (start of performance) to November 30, 1999 compared to the Standard & Poor's 500 Index (S&P 500).+ [Please see Appendix A16] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * Represents a hypothetical investment of $10,000 in the Fund after deducting the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge = $9,550). The Fund's performance assumes the reinvestment of dividends on securities in the indices. ** Total return quoted reflects all applicable sales charges and contingent deferred sales charges. + The S&P 500 is an unmanaged index comprised of common stocks in industry, transportation, and financial and public utility companies. The S&P 500 is not adjusted to reflect sales charges, expenses, or other fees than the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Personal Equity Fund (Class Y Shares) Growth of $10,000 Invested in Wachovia Personal Equity Fund (Class Y Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Personal Equity Fund (Class Y Shares) (the "Fund") from July 30, 1999 (start of performance) to November 30, 1999 compared to the Standard & Poor's 500 Index (S&P 500).+ [Please see Appendix A17] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * The Fund's performance assumes the reinvestment of all dividends and distributions. The S&P 500 has been adjusted to reflect the reinvestment of dividends on securities in the index. + The S&P 500 is an unmanaged index comprised of common stocks in industry, transportation, and financial and public utility companies. The S&P 500 is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Personal Equity Fund Portfolio of Investments November 30, 1999
Shares Value - ----------------------------------------------------------------------- Common Stocks--93.8% Basic Materials--3.6% 153,436 Du Pont (E.I.) de Nemours & Co. $ 9,119,852 114,980 Weyerhaeuser Co. 7,042,525 ------------ Total 16,162,377 ------------ Capital Goods--7.9% 114,754 General Electric Co. 14,918,020 260,996 Tyco International Ltd. 10,456,152 169,033 United Technologies Corp. 9,550,365 ------------ Total 34,924,537 ------------ Communication Services--6.0% 94,765 AT&T Corp. 5,294,994 204,992 (1)MCI Worldcom, Inc. 16,950,276 43,151 (1)Qwest Communications International, Inc. 1,475,225 65,955 Vodafone AirTouch PLC, ADR 3,112,252 ------------ Total 26,832,747 ------------ Consumer Cyclicals--6.4% 71,145 Carnival Corp. 3,139,273 44,664 Circuit City Stores, Inc. 2,166,204 38,307 (1)Federated Department Stores, Inc. 1,802,823 21,771 Gannett Co., Inc. 1,557,987 44,466 Home Depot, Inc. 3,515,593 27,801 Lowe's Cos., Inc. 1,384,837 48,741 Marriott International, Inc., Class A 1,587,129 33,364 McGraw-Hill Cos., Inc. 1,891,322 194,722 Wal-Mart Stores, Inc. 11,220,855 ------------ Total 28,266,023 ------------ Consumer Staples--8.4% 85,954 CBS Corp. 4,469,608 63,325 CVS Corp. 2,513,211 71,498 (1)Clear Channel Communications, Inc. 5,746,652 126,785 Comcast Corp., Class A 5,729,097 166,332 (1)Kroger Co. 3,544,951 143,652 PepsiCo, Inc. 4,964,972 12,704 Procter & Gamble Co. 1,372,032 76,564 (1)Safeway, Inc. 2,823,298 102,597 Time Warner, Inc. 6,328,952 ------------ Total 37,492,773 ------------
Shares Value Common Stocks--continued Energy--6.5% 175,183 Exxon Mobil Corp. $ 13,894,202 141,969 Royal Dutch Petroleum Co., ADR 8,234,202 112,073 Schlumberger Ltd. 6,731,384 ------------ Total 28,859,788 ------------ Finance--16.7% 78,020 American Express Co. 11,805,401 111,177 American International Group, Inc. 11,479,025 59,304 Bank One Corp. 2,090,466 61,481 Bank of New York Co., Inc. 2,451,555 79,627 Chase Manhattan Corp. 6,151,185 261,387 Citigroup, Inc. 14,082,225 48,987 Fannie Mae 3,263,759 153,000 Freddie Mac 7,554,375 41,931 MBIA, Inc. 2,096,550 32,411 Marsh & McLennan Cos., Inc. 2,548,315 11,532 Merrill Lynch & Co., Inc. 929,768 43,937 SunTrust Banks, Inc. 3,070,098 145,826 Wells Fargo Co. 6,780,909 ------------ Total 74,303,631 ------------ Healthcare--10.7% 121,486 Abbott Laboratories 4,616,468 154,988 Bristol-Myers Squibb Co. 11,323,811 57,269 Johnson & Johnson 5,941,658 50,139 Lilly (Eli) & Co. 3,597,473 102,128 Merck & Co., Inc. 8,017,048 265,671 Pfizer, Inc. 9,613,969 84,418 Schering Plough Corp. 4,315,870 ------------ Total 47,426,297 ------------ Technology--24.9% 85,098 (1)America Online, Inc. 6,185,561 200,030 (1)Cisco Systems, Inc. 17,840,176 131,765 (1)EMC Corp. 11,010,613 120,000 Intel Corp. 9,202,500 81,072 International Business Machines Corp. 8,355,483 112,936 Lucent Technologies, Inc. 8,251,386 174,755 (1)Microsoft Corp. 15,910,897 43,259 Nokia Oyj, Class A, ADR 5,977,853 129,980 (1)Sun Microsystems, Inc. 17,189,855 111,288 Texas Instruments, Inc. 10,690,604 ------------ Total 110,614,928 ------------
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Personal Equity Fund
Shares or Principal Amount Value - ------------------------------------------------------------------------------- Common Stocks--continued Utilities--2.7% 95,300 Duke Energy Corp. $ 4,830,519 104,900 Enron Corp. 3,992,756 145,580 Southern Co. 3,402,933 ------------ Total 12,226,208 ------------ Total Common Stocks (identified cost $233,368,167) 417,109,309 ------------ U.S. Government Agency--4.5% Finance--4.5% $20,000,000 (2)Federal Home Loan Mortgage Corp., Discount Bond, 12/17/1999 (identified cost $19,953,778) 19,953,778 ------------
Principal Amount Value U.S. Treasury Obligation--0.4% $ 2,000,000 (2)United States Treasury Bill, 12/16/1999 (identified cost $1,996,046) $ 1,996,046 ------------ (3) Repurchase Agreement--1.6% 7,169,987 Goldman Sachs Group, LP, 5.60%, dated 11/30/1999, due 12/1/1999 (at amortized cost) 7,169,987 ------------ Total Investments (identified cost $262,487,978) $446,229,120 ------------
(See Notes to Portfolios of Investments) - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Balanced Fund (Class A Shares) Growth of $10,000 Invested in Wachovia Balanced Fund (Class A Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Balanced Fund (Class A Shares) (the "Fund") from May 7, 1993 (start of performance) to November 30, 1999 compared to the Standard and Poor's 500 Index (S&P 500)+ and the Lehman Brothers Aggregate Bond Index (LBABI).+ [Please see Appendix A18] Past performance is no guarantee of future results. Your investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * Represents a hypothetical investment of $10,000 in the Fund after deducting the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge = $9,550). The Fund's performance assumes the reinvestment of all dividends and distributions. The S&P 500 and the LBABI have been adjusted to reflect the reinvestment of dividends on securities in the indices. ** Total returns quoted reflect all applicable sales charges and contingent deferred sales charges. + The S&P 500 is an unmanaged index comprised of common stocks in industry, transportation, and financial and public utility companies. The LBABI is an unmanaged index measuring both the capital price changes and income provided by the underlying universe of securities, comprised of U.S. Treasury obligations, U.S. agency obligations, foreign obligations, U.S. investment- grade corporate debt and mortgage-backed obligations. The S&P 500 and the LBABI are not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Balanced Fund (Class B Shares) Growth of $10,000 Invested in Wachovia Balanced Fund (Class B Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Balanced Fund (Class B Shares) (the "Fund") from July 23, 1996 (start of performance) to November 30, 1999 compared to the Standard and Poor's 500 Index (S&P 500)+ and the Lehman Brothers Aggregate Bond Index (LBABI).+ [Please see Appendix A19] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * Represents a hypothetical investment of $10,000 in the Fund. The ending value of the Fund reflects a 3.00% contingent deferred sales charge on any redemption less than four years from the purchase date. The maximum contingent deferred sales charge is 5.00% on any redemption less than one year from the purchase date. The Fund's performance assumes the reinvestment of all dividends and distributions. The S&P 500 and the LBABI have been adjusted to reflect the reinvestment of dividends on securities in the indices. ** Total returns quoted reflect all applicable sales charges and contingent deferred sales charges. + The S&P 500 is an unmanaged index comprised of common stocks in industry, transportation, and financial and public utility companies. The LBABI is an unmanaged index measuring both the capital price changes and income provided by the underlying universe of securities, comprised of U.S. Treasury obligations, U.S. agency obligations, foreign obligations, U.S. investment- grade corporate debt and mortgage-backed obligations. The S&P 500 and the LBABI are not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Balanced Fund (Class Y Shares) Growth of $10,000 Invested in Wachovia Balanced Fund (Class Y Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Balanced Fund (Class Y Shares) (the "Fund") from July 23, 1996 (start of performance) to November 30, 1999 compared to the Standard and Poor's 500 Index (S&P 500)+ and the Lehman Brothers Aggregate Bond Index (LBABI).+ [Please see Appendix A20] Past performance is no guarantee of future results. Your investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * The Fund's performance assumes the reinvestment of all dividends and distributions. The S&P 500 and the LBABI have been adjusted to reflect the reinvestment of dividends on securities in the indices. + The S&P 500 is an unmanaged index comprised of common stocks in industry, transportation, and financial and public utility companies. The LBABI is an unmanaged index measuring both the capital price changes and income provided by the underlying universe of securities, comprised of U.S. Treasury obligations, U.S. agency obligations, foreign obligations, U.S. investment- grade corporate debt and mortgage-backed obligations. The S&P 500 and the LBABI are not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Balanced Fund Portfolio of Investments November 30, 1999
Shares Value - ---------------------------------------------------------------------------- Common Stocks--60.5% Basic Materials--2.4% 45,614 Air Products & Chemicals, Inc. $ 1,476,753 32,004 Alcoa, Inc. 2,096,262 14,898 Dow Chemical Co. 1,744,928 21,193 Du Pont (E.I.) de Nemours & Co. 1,259,658 65,782 Rohm & Haas Co. 2,409,266 112,696 Weyerhaeuser Co. 6,902,630 ------------ Total 15,889,497 ------------ Capital Goods--4.0% 88,067 General Electric Co. 11,448,710 51,243 Ingersoll-Rand Co. 2,482,082 167,348 Tyco International Ltd. 6,704,379 96,977 United Technologies Corp. 5,479,201 ------------ Total 26,114,372 ------------ Communication Services--4.0% 135,354 AT&T Corp. 7,562,877 153,725 (1)MCI Worldcom, Inc. 12,711,136 44,207 (1)NEXTEL Communications, Inc., Class A 4,382,019 32,059 Vodafone AirTouch PLC, ADR 1,512,784 ------------ Total 26,168,816 ------------ Consumer Cyclicals--3.8% 72,681 Black & Decker Corp. 3,261,560 55,949 Carnival Corp. 2,468,750 24,657 (1)Federated Department Stores, Inc. 1,160,420 69,047 Lowe's Cos., Inc. 3,439,403 68,515 McGraw-Hill Cos., Inc. 3,883,944 51,949 Nordstrom, Inc. 1,444,832 32,555 Tandy Corp. 2,494,526 108,665 Wal-Mart Stores, Inc. 6,261,821 ------------ Total 24,415,256 ------------ Consumer Staples--5.8% 86,402 (1)AT&T Corp.--Liberty Media Group, Inc., Class A 3,612,684 97,782 CBS Corp. 5,084,664 124,820 CVS Corp. 4,953,794 52,131 (1)Clear Channel Communications, Inc. 4,190,029 108,020 Comcast Corp., Class A 4,881,153 248,006 (1)Kroger Co., Inc. 5,285,628 129,164 (1)Outback Steakhouse, Inc. 3,043,415 104,590 Time Warner, Inc. 6,451,896 ------------ Total 37,503,263 ------------
Shares Value Common Stocks--continued Energy--3.7% 71,600 BP Amoco PLC, ADR $ 4,363,125 81,547 Baker Hughes, Inc. 2,059,062 33,019 Burlington Resources, Inc. 1,110,264 173,255 Conoco, Inc., Class A 4,558,772 91,619 Exxon Corp. 7,266,532 46,045 Schlumberger Ltd. 2,765,578 34,691 Texaco, Inc. 2,113,983 ------------ Total 24,237,316 ------------ Finance--10.1% 50,058 American Express Co. 7,574,401 16,240 American General Corp. 1,190,595 86,836 American International Group, Inc. 8,965,817 23,698 Associates First Capital Corp., Class A 787,958 56,445 Bank One Corp. 1,989,686 87,904 Bank of America Corp. 5,142,384 40,816 Bank of New York Co., Inc. 1,627,538 55,441 Chase Manhattan Corp. 4,282,817 212,526 Citigroup, Inc. 11,449,838 36,164 Fannie Mae 2,409,426 74,115 Freddie Mac 3,659,428 29,187 First Union Corp. 1,129,172 33,712 MBIA Inc. 1,685,600 74,615 MBNA Corp. 1,884,028 25,547 Marsh & McLennan Cos., Inc. 2,008,633 19,318 Merrill Lynch & Co., Inc. 1,557,514 50,648 SunTrust Banks, Inc. 3,539,029 110,077 Wells Fargo Co. 5,118,581 ------------ Total 66,002,445 ------------ Healthcare--6.6% 42,521 Abbott Laboratories 1,615,798 37,680 (1)Amgen, Inc. 1,716,795 92,413 Bristol-Myers Squibb Co. 6,751,925 21,891 Guidant Corp. 1,094,550 79,589 Johnson & Johnson 8,257,359 44,980 Lilly (Eli) & Co. 3,227,315 73,412 Medtronic, Inc. 2,853,892 78,763 Merck & Co., Inc. 6,182,894 135,706 Pfizer, Inc. 4,910,861 23,832 Pharmacia & Upjohn, Inc. 1,303,313 22,378 Schering Plough Corp. 1,144,075 40,297 Warner-Lambert Co. 3,614,137 ------------ Total 42,672,914 ------------
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Balanced Fund
Shares or Principal Amount Value - ------------------------------------------------------------------------------- Common Stocks--continued Technology--17.4% 93,676 (1)America Online, Inc. $ 6,809,074 168,502 (1)Cisco Systems, Inc. 15,028,272 109,002 (1)EMC Corp. 9,108,479 107,727 Intel Corp. 8,261,314 56,485 International Business Machines Corp. 5,821,485 46,875 (1)JDS Uniphase Corp. 10,722,656 95,491 Lucent Technologies, Inc. 6,976,778 144,942 (1)Microsoft Corp. 13,196,516 33,405 (1)Network Appliance, Inc. 3,931,351 29,757 Nokia Oyj, Class A, ADR 4,112,045 93,752 (1)Sun Microsystems, Inc. 12,398,702 81,881 Texas Instruments, Inc. 7,865,693 95,424 (1)Veritas Software Corp. 8,737,260 ------------ Total 112,969,625 ------------ Transportation--0.7% 50,535 Burlington Northern Santa Fe 1,465,515 198,447 Southwest Airlines Co. 3,237,167 ------------ Total 4,702,682 ------------ Utilities--2.0% 48,683 Consolidated Edison Co. 1,679,564 87,372 Duke Energy Corp. 4,428,668 96,214 Enron Corp. 3,662,145 136,645 Southern Co. 3,194,077 ------------ Total 12,964,454 ------------ Total Common Stocks (identified cost $266,202,281) 393,640,640 ------------ Asset Backed Securities--2.0% $4,000,000 American Express Credit Account Master Trust 1997-1, Class A, 6.40%, 4/15/2005 3,976,240 1,000,000 AT&T Universal Card Master Trust 1995-2, Class A, 5.95%, 10/17/2002 996,560 2,025,000 Carco Auto Loan Master Trust 1999-4, Class A, 6.43%, 11/15/2004 2,012,850 1,350,000 Chase Credit Card Master Trust, Class A, 6.30%, 4/15/2003 1,349,568 7,938,170 Deutsche Mortgage and Asset Receiving Corp. 1998-C1, Class X, 1.242%, 2/15/2023 401,870 629,500 Deutsche Mortgage and Asset Receiving Corp. 1998-C1, Class D, 7.23%, 6/15/2031 547,124
Principal Amount Value Asset Backed Securities--continued $2,100,000 DLJ Commercial Mortgage Corp. 1999-CG1, Class A1B, 6.46%, 1/10/2009 $ 1,992,417 1,000,000 First Omni Bank Credit Card Master Trust 1996-A, Class A, 6.65%, 9/15/2003 1,000,000 628,028 First Plus Home Loan Trust 1997-1, Class A4, 6.60%, 7/10/2010 627,079 138,558 Prudential Home Mortgage Securities 1993-60, Class A1, 6.75%, 12/25/2023 138,212 ------------ Total Asset Backed Securities (identified cost $13,581,010) 13,041,920 ------------ Corporate Bonds--12.9% Basic Materials--0.5% 1,365,000 Du Pont (E.I.) de Nemours & Co., Note, 6.75%, 10/15/2004 1,357,806 1,330,000 Nalco Chemical Co., Bond, 6.25%, 5/15/2008 1,175,946 750,000 Temple-Inland, Inc., Unsecd. Note, 7.25%, 9/15/2004 734,753 ------------ Total 3,268,505 ------------ Communication Services--1.2% 2,500,000 AT&T Corp., Global Bond, 6.00%, 3/15/2009 2,295,275 1,000,000 New England Telephone & Telegraph, Note, 5.875%, 4/15/2009 909,220 3,980,000 New York Telephone Co., Deb., 6.00%, 4/15/2008 3,685,958 1,300,000 Southwestern Bell Telephone Co., Note, 7.00%, 8/26/2002 1,307,501 ------------ Total 8,197,954 ------------ Consumer Cyclicals--0.3% 2,000,000 Tribune Co., Note, 6.25%, 11/10/2026 1,970,880 ------------ Consumer Staples--0.1% 750,000 Archer-Daniels-Midland Co., Note, 6.625%, 5/1/2029 652,388 ------------ Finance--8.1% 1,000,000 American General Finance Corp., Sr. Note, 6.52%, 6/23/2000 1,001,610 2,500,000 Aon Capital Trust A, Company Guarantee, 8.205%, 1/1/2027 2,555,025
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Balanced Fund
Principal Amount Value - ------------------------------------------------------------------------------- Corporate Bonds--continued Finance--continued $ 1,100,000 Associates Corp. of North America, Sr. Note, 6.50%, 7/15/2002 $ 1,092,553 1,000,000 Associates Corp. of North America, Sr. Note, 6.50%, 10/15/2002 992,170 750,000 Bank of America Corp., Note, 6.625%, 6/15/2004 737,783 865,000 Bankers Trust Corp., Sub. Note, 7.375%, 5/1/2008 854,352 1,000,000 Bear Stearns Cos., Inc., Sr. Note, 6.50%, 7/5/2000 999,180 2,000,000 CIT Group, Inc., Sr. Note, 6.375%, 10/1/2002 1,968,600 500,000 Caterpillar Financial Services Corp., MTN, 6.50%, 10/15/2002 495,875 3,000,000 Chase Manhattan Corp., Sr. Note, 5.15%, 12/15/2000 2,962,290 1,605,000 Chase Manhattan Corp., Sr. Note, 6.75%, 12/1/2004 1,590,074 1,492,839 Chase Manhattan Bank First Union National, Class A1, 7.134%, 7/15/2007 1,488,003 1,075,000 Commercial Credit Co., Deb., 8.70%, 6/15/2010 1,182,704 1,000,000 Commercial Credit Co., Note, 6.50%, 8/1/2004 978,060 1,000,000 Countrywide Home Loans, Inc., Company Guarantee, 6.05%, 3/1/2001 992,510 1,000,000 DaimlerChrysler North America Holding Corp. , 6.63%, 9/21/2001 999,200 1,000,000 Distribution Financial Services RV Trust, 6.48%, 10/15/2013 989,250 1,937,174 Federal National Mortgage Association, Class J, 7.00%, 2/25/2021 1,940,196 1,000,000 Ford Motor Credit Corp., Note, 7.00%, 9/25/2001 1,004,110 1,500,000 General Motors Acceptance Corp., Note, 6.625%, 10/1/2002 1,491,345 1,000,000 Goldman Sachs Group, Inc., Sr. Unsub., 6.65%, 5/15/2009 946,750 1,500,000 Hartford Life, Inc., Note, 7.10%, 6/15/2007 1,472,280 1,295,000 Household Finance Corp., Note, 6.00%, 5/1/2004 1,240,468
Principal Amount Value Corporate Bonds--continued Finance--continued $ 2,750,000 IBM Credit Corp., MTN, 5.79%, 3/20/2010 (Callable 3/20/2000 @100) $ 2,746,645 1,000,000 KFW International Finance, Company Guarantee, 8.25%, 11/30/2004 1,057,682 1,500,000 KFW International Finance, Note, 7.00%, 3/1/2013 1,452,840 735,000 Landeskreditbank B-W, Sub. Note, 7.875%, 4/15/2004 758,300 2,000,000 Lehman Brothers Holdings, Inc., Bond, 7.00%, 5/15/2003 1,974,840 1,000,000 Lehman Brothers Holdings, Inc., Note, 6.125%, 7/15/2003 960,690 2,500,000 Merrill Lynch & Co., Inc., Bond, 6.00%, 7/15/2005 2,372,900 500,000 Merrill Lynch & Co., Inc., Note, 7.375%, 5/15/2006 505,155 1,000,000 Morgan Stanley, Dean Witter & Co., Sr. Note, Series C, MTN, 5.875%, 2/28/2001 989,560 750,000 Morgan Stanley, Dean Witter & Co., Unsecd. Note, Series I, 7.07%, 2/10/2014 723,945 750,000 National Rural Utilities Cooperative Finance Corp., Collateral Trust, 5.75%, 11/1/2008 678,818 1,000,000 NationsBank Corp., MTN, 6.94%, 4/12/2002 1,003,580 1,000,000 NationsBank Corp., Sub. Note, 6.875%, 2/15/2005 989,230 3,500,000 Norwest Financial, Inc., Sr. Note, 6.375%, 9/15/2002 3,462,795 1,000,000 Norwest Financial, Inc., Sr. Note, 6.625%, 7/15/2004 985,820 2,380,000 Union Planters Corp., Sub. Note, 6.50%, 3/15/2018 2,136,621 ------------ Total 52,773,809 ------------ Industrial Services--0.2% 1,335,000 WMX Technologies, Inc., Note, 8.00%, 4/30/2004 1,240,896 ------------ Technology--0.9% 4,250,000 Eastman Kodak Co., Note, 6.50%, 8/15/2001 4,227,050 1,500,000 Motorola, Inc., Sr. Deb., 6.50%, 9/1/2025 1,469,580 ------------ Total 5,696,630 ------------
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Balanced Fund
Principal Amount Value - ------------------------------------------------------------------------------- Corporate Bonds--continued Utilities--1.6% $ 680,000 GTE California, Inc. , Deb., Series G, 5.50%, 1/15/2009 $ 602,949 1,750,000 General Electric Capital Corp., 6.81%, 11/3/2003 1,755,863 1,956,367 General Services Administration--Rosecliff Realty, Note, 8.00%, 11/15/2008 2,025,661 3,060,000 National Fuel Gas Co., Series D, MTN, 6.303%, 5/27/2008 2,845,219 1,500,000 Ontario Hydro, Sr. Note, 6.10%, 1/30/2008 1,410,000 1,500,000 Virginia Electric Power Co., 1st Ref. Mtg., Series B, 6.625%, 4/1/2003 1,486,665 ------------ Total 10,126,357 ------------ Total Corporate Bonds (identified cost $86,880,925) 83,927,419 ------------ Mortgage Backed Securities--13.2% Federal Home Loan Bank--0.1% 1,000,000 5.40%, 3/1/2004 954,690 ------------ Federal Home Loan Mortgage Corporation--0.5% 575,399 6.00%, 10/1/2000 572,913 1,364,191 6.00%, 8/1/2013 1,307,059 139,376 6.50%, 12/1/2008 137,347 32,407 6.50%, 2/1/2009 31,935 439,188 6.50%, 3/1/2009 432,793 36,704 6.50%, 4/1/2009 36,170 177,724 6.50%, 6/1/2009 175,136 185,441 6.50%, 7/1/2010 182,469 388,700 7.00%, 2/1/2023 381,898 ------------ Total 3,257,720 ------------ Federal National Mortgage Association--8.1% 5,869,000 5.13%, 2/13/2004 5,559,058 688,719 6.00%, 12/1/2010 663,533 1,120,970 6.00%, 4/1/2011 1,077,880 5,038,794 6.00%, 12/1/2012 4,835,630 1,624,423 6.00%, 1/1/2013 1,558,926 3,313,211 6.00%, 4/1/2013 3,179,622 2,009,736 6.00%, 7/1/2013 1,924,946 1,699,171 6.13%, 9/1/2008 1,595,641 2,378,111 6.50%, 7/1/2013 2,325,341
Principal Amount Value Mortgage Backed Securities--continued Federal National Mortgage Association--continued $ 1,040,709 6.50%, 1/1/2028 $ 992,576 12,335,055 6.50%, 2/1/2029 11,764,559 5,437,924 6.50%, 8/1/2029 5,186,420 5,432,997 6.50%, 10/1/2029 5,181,721 490,569 6.54%, 12/1/2007 473,739 1,855,157 6.56%, 12/1/2007 1,793,525 2,425,777 7.06%, 8/1/2006 2,418,385 816,427 7.50%, 4/1/2007 824,592 422,576 7.50%, 9/1/2022 423,434 111,329 8.00%, 6/1/2022 113,278 151,374 8.00%, 1/1/2023 153,928 16,757 8.50%, 8/1/2016 17,342 10,118 8.50%, 6/1/2024 10,424 124,763 8.50%, 7/1/2024 128,544 10,454 8.50%, 10/1/2024 10,770 186,446 8.50%, 12/1/2024 192,096 20,094 10.50%, 6/1/2001 20,195 ------------ Total 52,426,105 ------------ Government National Mortgage Association--4.2% 3,682,982 6.00%, 2/15/2029 3,402,155 3,139,879 6.00%, 2/15/2029 2,900,463 3,029,143 6.00%, 2/15/2029 2,795,263 5,990,335 6.00%, 3/15/2029 5,533,572 650,471 6.50%, 10/15/2008 641,065 884,910 6.50%, 12/15/2012 866,654 856,861 6.50%, 2/15/2013 839,449 792,438 6.50%, 2/15/2013 776,336 710,062 6.50%, 2/15/2013 695,413 347,871 6.50%, 3/15/2024 333,413 1,985,631 6.50%, 4/15/2029 1,888,832 1,903,209 6.50%, 4/15/2029 1,810,428 516,030 7.00%, 5/15/2023 506,674 1,099,648 7.00%, 8/15/2023 1,079,712 254,338 7.00%, 8/15/2023 249,727 608,113 7.00%, 12/20/2025 591,390 280,835 7.50%, 3/15/2023 281,186 985,701 7.50%, 8/15/2027 983,543 414,769 8.00%, 10/15/2022 422,674 162,864 8.00%, 6/15/2023 165,968 51,281 9.00%, 3/15/2009 54,073 39,343 9.00%, 11/15/2016 41,531 79,869 9.00%, 11/15/2019 84,361 242,616 9.00%, 12/15/2019 256,260
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Balanced Fund
Principal Amount Value - ------------------------------------------------------------------------------ Mortgage Backed Securities--continued Government National Mortgage Association-- continued $ 134,506 9.00%, 1/15/2021 $ 141,734 27,462 9.00%, 4/15/2021 28,938 ------------ Total 27,370,814 ------------ Tennessee Valley Authority--0.3% 2,200,000 Tennessee Valley Authority, Bond, 5.28%, 9/14/2001 2,161,852 ------------ Total Mortgage Backed Securities (identified cost $89,336,514) 86,171,181 ------------ (2) U.S. Treasury Obligations--7.7% U.S. Treasury Bill--0.2% 1,100,000 12/16/1999 1,098,636 ------------ U.S. Treasury Bonds--5.5% 5,400,000 6.125%, 11/15/2027 5,141,826 11,625,000 6.375%, 8/15/2027 11,423,423 16,079,000 (2)7.125%, 2/15/2023 17,144,234 1,900,000 8.125%, 8/15/2019 2,212,018 ------------ Total 35,921,501 ------------ U.S. Treasury Notes--2.0% 1,000,000 5.50%, 5/31/2000 999,370 8,210,000 5.875%, 11/15/2005 8,076,588 1,000,000 5.875%, 9/30/2002 995,160 2,955,000 7.875%, 11/15/2004 3,161,850 ------------ Total 13,232,968 ------------ Total U.S. Treasury Obligations (identified cost $52,125,657) 50,253,105 ------------
Shares or Principal Amount Value Closed-End Investment Companies--1.8% 44,000 2002 Target Term Trust, Inc. $ 596,750 338,501 Blackrock 2001 Term Trust, Inc. 3,004,196 30,600 Blackrock Advantage Term Trust 277,313 222,900 Blackrock Strategic Term Trust, Inc. 1,964,306 329,711 Blackrock Target Term Trust 3,152,861 55,900 RCM Strategic Global Government Fund 492,619 12,500 TCW/DW Term Trust 2002 116,406 124,800 TCW/DW Term Trust 2003 1,138,800 153,700 Templeton Global Income Fund 941,413 ------------ Total Closed-End Investment Companies (identified cost $11,640,672) 11,684,664 ------------ (3) Repurchase Agreement--1.5% $9,709,927 Goldman Sachs Group, LP, 5.60%, dated 11/30/1999, due 12/1/1999 (at amortized cost) 9,709,927 ------------ Total Investments (identified cost $529,476,986) $648,428,856 ------------
(See Notes to Portfolios of Investments) - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Fixed Income Fund (Class A Shares) Growth of $10,000 Invested in Wachovia Fixed Income Fund (Class A Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Fixed Income Fund (Class A Shares) (the "Fund") from May 7, 1993 (start of performance) to November 30, 1999 compared to the Lehman Brothers Aggregate Bond Index (LBABI).+ [Please see Appendix A21] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * Represents a hypothetical investment of $10,000 in the Fund after deducting the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge = $9,550). The Fund's performance assumes the reinvestment of all dividends and distributions. The LBABI has been adjusted to reflect the reinvestment of dividends on securities in the index. ** Total returns quoted reflect all applicable sales charges and contingent deferred sales charges. + The LBABI is an unmanaged index measuring both the capital price changes and income provided by the underlying universe of securities, comprised of U.S. Treasury obligations, U.S. agency obligations, foreign obligations, U.S. investment-grade corporate debt and mortgage-backed obligations. The LBABI is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Fixed Income Fund (Class B Shares) Growth of $10,000 Invested in Wachovia Fixed Income Fund (Class B Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Fixed Income Fund (Class B Shares) (the "Fund") from July 23, 1996 (start of performance) to November 30, 1999 compared to the Lehman Brothers Aggregate Bond Index (LBABI).+ [Please see Appendix A22] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * Represents a hypothetical investment of $10,000 in the Fund. The ending value of the Fund reflects a 3.00% contingent deferred sales charge on any redemption less than four years from the purchase date. The maximum contingent deferred sales charge is 5.00% on any redemption less than one year from the date of purchase. The Fund's performance assumes the reinvestment of all dividends and distributions. The LBABI has been adjusted to reflect the reinvestment of dividends on securities in the index. ** Total returns quoted reflect all applicable sales charges and contingent deferred sales charges. + The LBABI is an unmanaged index measuring both the capital price changes and income provided by the underlying universe of securities, comprised of U.S. Treasury obligations, U.S. agency obligations, foreign obligations, U.S. investment-grade corporate debt and mortgage-backed obligations. The LBABI is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Fixed Income Fund (Class Y Shares) Growth of $10,000 Invested in Wachovia Fixed Income Fund (Class Y Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Fixed Income Fund (Class Y Shares) (the "Fund") from July 23, 1996 (start of performance) to November 30, 1999 compared to the Lehman Brothers Aggregate Bond Index (LBABI).+ [Please see Appendix A23] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * The Fund's performance assumes the reinvestment of all dividends and distributions. The LBABI has been adjusted to reflect the reinvestment of dividends on securities in the index. + The LBABI is an unmanaged index measuring both the capital price changes and income provided by the underlying universe of securities, comprised of U.S. Treasury obligations, U.S. agency obligations, foreign obligations, U.S. investment-grade corporate debt and mortgage-backed obligations. The LBABI is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Fixed Income Fund Portfolio of Investments November 30, 1999
Principal Amount Value - ------------------------------------------------------------------------------- Asset-Backed Securities--7.3% Finance--7.3% $11,575,000 American Express Credit Account Master Trust, Series 1997-1, Class A, 6.40%, 4/15/2005 $ 11,506,245 8,020,000 Carco Auto Loan Master Trust, Series 1999-4, Class A, 6.43%, 11/15/2004 7,971,880 640,000 Chase Manhattan Credit Card Master Trust, Series 1996-3, Class A, 7.04%, 2/15/2005 643,597 2,300,000 Circuit City Credit Card Master Trust, Series 1995- 1, Class A, 6.375%, 8/15/2005 2,298,114 4,880,000 DLJ Commercial Mortgage Corp., Series 1999-CG1, Class A1B, 6.46%, 1/10/2009 4,629,998 3,250,000 Distribution Financial Services RV Trust, Series 1999-1, Class A5, 5.97%, 8/15/2013 3,187,893 2,905,762 Federal National Mortgage Association, Class J, 7.00%, 2/25/2021 2,910,295 942,042 First Plus Home Loan Trust, Series 1996-4, Class A4, 6.60%, 7/10/2010 940,619 1,885,000 First USA Credit Card Master Trust, Series 1997-6, Class A, 6.42%, 3/17/2005 1,876,744 5,000,000 Prime Credit Card Master Trust, Series 1996-1, Class A, 6.70%, 7/15/2004 5,003,100 ------------ Total Asset-Backed Securities (identified cost $41,520,603) 40,968,485 ------------ Collateralized Mortgage Obligations--1.9% Finance--1.9% 2,000,000 Commercial Mortgage Asset Trust, Series 1999-C1, Class C, 7.35%, 8/17/2013 1,878,880 2,000,000 Criimi Mae CMBS Corp., Series 1998-1, Class A2, 6.01%, 2/20/2005 1,847,030 2,825,000 Deutsche Mortgage and Asset Receiving Corp., Series 1998-C1, Class D, 7.23%, 6/15/2031 2,455,321
Principal Amount Value Collateralized Mortgage Obligations--continued Finance--continued $33,712,723 Deutsche Mortgage and Asset Receiving Corp., Series 1998-C1, Class X, 1.254%, 2/15/2023 $ 1,706,707 2,000,000 Nomura Asset Securities Corp., Series 1998-D6, Class A3, 6.98%, 3/17/2028 1,846,040 31,818,483 Nomura Asset Securities Corp., Series 1998-D6, Class ACS1, 1.65%, 3/17/2028 782,098 ------------ Total Collateralized Mortgage Obligations (identified cost $15,534,930) 10,516,076 ------------ Corporate Bonds--26.1% Banking & Finance--2.4% 1,340,000 BB&T Corp., Sub. Note, 7.25%, 6/15/2007 1,299,733 3,559,087 Chase Manhattan Bank--First Union National, Series 1999-1, Class A1, 7.13%, 7/15/2007 3,547,556 500,000 First Colony Corp., Sr. Note, 6.625%, 8/1/2003 490,575 3,000,000 First National Bank of Commerce, Sr. Note, 6.50%, 1/14/2000 3,002,010 4,915,000 Landeskreditbank B-W, Sub. Note, 7.88%, 4/15/2004 5,070,806 ------------ Total 13,410,680 ------------ Basic Materials--0.9% 240,000 Armstrong World Industries, Inc., Deb., 9.75%, 4/15/2008 266,364 1,405,000 Du Pont (E.I.) de Nemours & Co., Note, 6.875%, 10/15/2009 1,383,293 500,000 Du Pont (E.I.) de Nemours & Co., Sr. Note, 6.75%, 9/1/2007 490,580 1,000,000 Du Pont (E.I.) de Nemours & Co., Unsecd. Note, Series G, 6.47%, 9/26/2002 997,440 1,320,000 Nalco Chemical Co., Bond, 6.25%, 5/15/2008 1,167,104 750,000 Temple-Inland, Inc., Unsecd. Note, 7.25%, 9/15/2004 734,753 ------------ Total 5,039,534 ------------
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Fixed Income Fund
Principal Amount Value - ------------------------------------------------------------------------------ Corporate Bonds--continued Capital Goods--1.0% $ 5,670,000 Ingersoll-Rand Co., Note, 6.13%, 11/18/2027 $ 5,595,099 ------------ Communication Services--1.0% 5,100,000 AT&T Corp., Global Bond, 6.00%, 3/15/2009 4,682,361 1,200,000 Sprint Capital Corp., Company Guarantee, 6.88%, 11/15/2028 1,087,836 ------------ Total 5,770,197 ------------ Consumer Cyclicals--0.7% 500,000 General Motors Corp., Unsecd. Note, 7.10%, 3/15/2006 499,010 3,000,000 Tribune Co., Note, 6.25%, 11/10/2026 2,956,320 500,000 Wal-Mart Stores, Inc., Unsecd. Note, 6.75%, 5/15/2002 501,120 ------------ Total 3,956,450 ------------ Consumer Staples--0.6% 500,000 Anheuser-Busch Cos., Inc., Unsecd. Note, 6.90%, 10/1/2002 498,295 840,000 Archer-Daniels-Midland Co., Note, 6.625%, 5/1/2029 730,674 2,000,000 McDonald's Corp., Sr. Note, 6.00%, 6/23/2012 1,971,660 ------------ Total 3,200,629 ------------ Finance--14.4% 2,135,000 Abbey National Bank PLC, London, Sub., 6.69%, 10/17/2005 2,077,120 1,000,000 American Express Co., Discount Note, 12/12/2000 930,557 1,250,000 Bank of America Corp., Note, 6.625%, 6/15/2004 1,229,638 1,000,000 Bank of America Corp., Sub. Note, 6.625%, 8/1/2007 962,260 1,000,000 Bankers Trust Corp., Sr. Note, 6.75%, 10/3/2001 999,990 1,220,000 Bankers Trust Corp., Sub. Note, 7.25%, 10/15/2011 1,170,871 1,880,000 Bankers Trust Corp., Sub. Note, 7.375%, 5/1/2008 1,856,857 1,975,000 Bear Stearns Cos., Inc., Sr. Note, 6.70%, 8/1/2003 1,939,450 1,000,000 Beneficial Corp., Note, 6.20%, 12/4/2000 998,680 2,500,000 Commercial Credit Co., Unsecd. Note, 7.375%, 4/15/2005 2,494,450
Principal Amount Value Corporate Bonds--continued Finance--continued $ 185,000 Deutsche Bank Financial, Inc., Bank Guarantee, 7.50%, 4/25/2009 $ 184,193 5,000,000 Distribution Financial Services RV Trust, Series 1999-2, Class A4, 6.480%, 10/15/2013 4,946,250 755,000 First Union Corp., Sub. Note, 6.824%, 8/1/2026 753,724 800,000 General Motors Acceptance Corp., Note, 6.30%, 7/8/2002 789,712 3,000,000 Hanson Overseas B.V., Sr. Note, 7.375%, 1/15/2003 3,028,890 2,000,000 Hartford Life, Inc., Note, 7.10%, 6/15/2007 1,963,040 500,000 Heller Financial, Inc., Unsecd. Note, 5.625%, 3/15/2000 499,015 500,000 Household Finance Corp., 6.40%, 6/17/2008 469,600 3,750,000 IBM Credit Corp., Sr. Note, 5.79%, 3/20/2010 (Callable 3/20/2000 @100) 3,745,425 3,000,000 Ikon Capital Resources, Note, 6.94%, 5/21/2001 3,001,350 2,000,000 Inter-American Development Bank, Deb., 8.88%, 6/1/2009 2,274,900 2,145,000 International Lease Finance Corp., Note, 5.625%, 5/1/2002 2,087,964 7,165,000 Lehman Brothers Holdings, Inc., Bond, 7.00%, 5/15/2003 7,074,864 1,000,000 Lehman Brothers Holdings, Inc., Sr. Note, 8.75%, 3/15/2005 1,053,060 1,375,000 Mercantile Bancorporation, Inc., 6.80%, 6/15/2001 1,373,708 2,000,000 Merrill Lynch & Co., Inc., Bond, 6.00%, 7/15/2005 1,898,320 500,000 Merrill Lynch & Co., Inc., Sr. Note, 7.00%, 4/27/2008 491,655 2,000,000 Merrill Lynch & Co., Inc., Sr. Note, Series B, 6.80%, 4/26/2001 2,006,820 1,100,000 Metropolitan Life Insurance Co., 7.00%, 11/1/2005 1,075,591 2,090,000 Morgan Stanley Group, Inc., Note, 6.88%, 3/1/2007 2,054,407 4,000,000 Morgan Stanley, Dean Witter & Co., Sr. MTN, Series C, 5.875%, 2/28/2001 3,958,240
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Fixed Income Fund
Principal Amount Value - ------------------------------------------------------------------------------ Corporate Bonds--continued Finance--continued $ 1,500,000 Morgan Stanley, Dean Witter & Co., Unsecd. Note, Series I, 7.07%, 2/10/2014 $ 1,447,890 2,250,000 National Rural Utilities Cooperative Finance Corp., Collateral Trust, 5.75%, 11/1/2008 2,036,453 2,100,000 Salomon, Inc., Note, 6.38%, 10/1/2004 2,035,341 4,250,000 Smithkline Beecham Corp., Company Guarantee, 6.75%, 9/5/2000 4,262,627 4,700,000 Union Planters Corp., Sub. Note, 6.50%, 3/15/2018 4,219,378 2,000,000 Wells Fargo & Co., Sr. Note, Series H, 6.75%, 6/15/2007 1,934,360 2,615,000 World Bank, Note, 5.00%, 11/28/2000 2,581,439 3,000,000 Xerox Capital Trust I, Company Guarantee, 8.00%, 2/1/2027 2,772,060 ------------ Total 80,680,149 ------------ Technology--1.8% 3,000,000 Electronic Data Systems Corp., Note, 7.125%, 10/15/2009 2,962,290 3,370,000 Motorola, Inc., Deb., 5.22%, 10/1/2097 2,170,819 5,000,000 Motorola, Inc., Sr. Deb., 6.50%, 9/1/2025 4,898,600 ------------ Total 10,031,709 ------------ Utilities--3.3% 500,000 Baltimore Gas & Electric Co., 1st Ref. Mtg., 6.50%, 2/15/2003 495,575 1,000,000 General Electric Capital Corp., 6.81%, 11/3/2003 1,003,350 2,500,000 General Electric Capital Corp., Note, 8.85%, 4/1/2005 2,706,125 4,469,372 General Services Administration--Rosecliff Realty, Note, 8.00%, 11/15/2008 4,648,316 5,000,000 National Fuel Gas Co., Note, 6.303%, 5/27/2008 4,649,050
Principal Amount Value Corporate Bonds--continued Utilities--continued $ 1,135,000 Ontario Hydro, Sr. Note, 6.10%, 1/30/2008 $ 1,066,900 250,000 Public Service Electric & Gas Co., 1st Ref. Mtg., Series FF, 7.875%, 11/1/2001 254,005 3,000,000 SCANA Corp., Sr. Note, Series B, 6.25%, 7/8/2003 2,942,190 500,000 Union Electric Co., 1st Mtg. Bond, 6.875%, 8/1/2004 497,740 ------------ Total 18,263,251 ------------ Total Corporate Bonds (identified cost $147,425,190) 145,947,698 ------------ Foreign Bonds--1.9% Finance--1.5% 1,000,000 Israel AID, 5.63%, 9/15/2003 963,800 1,590,000 Israel AID, 6.125%, 3/15/2003 1,562,286 5,000,000 Israel AID, 8.00%, 11/15/2001 5,129,550 1,005,000 Province of Manitoba, 9.00%, 12/15/2000 1,030,788 ------------ Total 8,686,424 ------------ Utilities--0.4% 500,000 GTE California, Inc. , Deb., Series A, 5.625%, 2/1/2001 494,890 1,820,000 GTE California, Inc. , Deb., Series G, 5.50%, 1/15/2009 1,613,776 ------------ Total 2,108,666 ------------ Total Foreign Bonds (identified cost $10,764,592) 10,795,090 ------------ Corporate Notes--1.3% Finance--1.3% 5,000,000 BankUnited Financial Corp., Note, 5.40%, 2/2/2004 4,699,850 1,000,000 Caterpillar Financial Services Corp., MTN, 6.50%, 10/15/2002 991,750 1,750,000 Norwest Financial, Inc., Sr. Note, 6.625%, 7/15/2004 1,725,185 ------------ Total Corporate Notes (identified cost $7,692,103) 7,416,785 ------------
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Fixed Income Fund
Principal Amount Value - ------------------------------------------------------------------------ U.S. Government Agencies--39.0% Federal Farm Credit Bank--0.3% $ 1,700,000 5.730%, 7/28/2003 $ 1,654,576 ------------ Federal Home Loan Bank--2.2% 1,000,000 6.520%, 4/2/2003 998,750 1,000,000 6.050%, 11/26/2001 994,840 4,300,000 5.765%, 6/11/2003 4,194,521 2,000,000 5.720%, 8/25/2003 1,945,320 1,500,000 5.625%, 6/2/2000 1,495,305 500,000 5.500%, 1/21/2003 485,235 2,000,000 5.485%, 3/23/2004 1,914,680 ------------ Total 12,028,651 ------------ Federal Home Loan Mortgage Corporation--2.1% 6,682 12.50%, 7/1/2011 7,367 2,438 12.50%, 3/1/2014 2,711 1,762 12.50%, 2/1/2010 1,932 8,355 11.00%, 10/1/2015 8,963 1,504 11.00%, 10/1/2010 1,614 13,828 9.50%, 7/1/2016 14,591 737 9.50%, 2/1/2019 781 403 9.50%, 2/1/2019 427 5,612 9.00%, 5/15/2016 5,938 821 9.00%, 1/1/2019 852 1,010 9.00%, 1/1/2019 1,049 811 8.50%, 8/1/2017 833 5,497 8.50%, 7/1/2017 5,646 6,348 8.25%, 10/1/2007 6,468 28,956 8.00%, 4/1/2009 29,327 795,592 8.00%, 2/1/2017 805,783 4,309 8.00%, 2/1/2009 4,355 8,296 8.00%, 12/1/2008 8,385 1,342 8.00%, 1/1/2019 1,359 472 8.00%, 1/1/2009 477 13,377 8.00%, 1/1/2008 13,548 500,000 7.75%, 11/7/2001 512,810 25,341 7.50%, 9/1/2007 25,674 95,997 7.50%, 2/1/2023 96,237 62,564 7.50%, 2/1/2023 62,720 187,073 7.50%, 2/1/2023 187,541 54,359 7.50%, 2/1/2023 54,495 72,423 7.50%, 2/1/2023 72,604 487,570 7.00%, 6/1/2008 487,277 693,471 7.00%, 2/1/2023 681,335 171,695 7.00%, 1/1/2023 168,690 1,653,286 6.50%, 8/1/2013 1,616,599 107,218 6.50%, 7/1/2008 105,656
Principal Amount Value U.S. Government Agencies--continued Federal Home Loan Mortgage Corporation--continued $ 217,715 6.50%, 6/1/2008 $ 214,545 75,562 6.50%, 6/1/2008 74,461 11,193 6.50%, 6/1/2008 11,047 405,241 6.50%, 6/1/2008 399,937 427,023 6.50%, 5/1/2008 421,433 446,768 6.50%, 4/1/2009 440,263 1,198,571 6.50%, 11/1/2011 1,173,473 1,000,000 6.05%, 9/15/2022 975,930 304,961 6.00%, 10/1/2000 303,644 3,000,000 5.75%, 7/15/2003 2,926,410 ------------ Total 11,935,187 ------------ Federal National Mortgage Association--24.7% 179 12.50%, 9/1/2013 198 190 9.50%, 7/1/2016 202 1,342 9.50%, 7/1/2016 1,415 299 9.00%, 1/1/2017 313 149 8.50%, 2/1/2019 154 20,890 8.00%, 9/1/2009 21,283 1,188,632 8.00%, 7/1/2025 1,206,830 31,072 8.00%, 6/1/2022 31,616 2,240 8.00%, 11/1/2008 2,282 4,451 8.00%, 1/1/2009 4,535 182,126 7.50%, 6/1/2023 182,410 260,612 7.50%, 6/1/2023 261,018 703,973 7.50%, 5/1/2026 703,311 371,103 7.50%, 4/1/2007 374,814 414,354 7.50%, 12/1/2022 415,000 624,784 7.50%, 1/1/2023 625,952 184,913 7.50%, 1/1/2023 185,288 262,073 7.50%, 1/1/2023 262,482 89,362 7.50%, 1/1/2023 89,501 84,908 7.50%, 1/1/2023 85,080 3,554,808 7.10%, 12/1/2006 3,550,638 4,985,435 7.00%, 8/1/2029 4,871,667 2,272,411 7.00%, 11/1/2028 2,220,555 14,985,389 7.00%, 10/1/2029 14,643,422 4,394,220 6.94%, 4/1/2004 4,373,699 6,282,644 6.90%, 4/1/2006 6,217,654 2,112,232 6.50%, 9/1/2012 2,066,671 2,555,395 6.50%, 9/1/2012 2,500,275 865,498 6.50%, 8/1/2013 846,293 1,000,000 6.50%, 7/29/2002 991,250 1,689,244 6.50%, 7/1/2013 1,651,759 6,886,331 6.50%, 7/1/2013 6,733,523
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Fixed Income Fund
Principal Amount Value - -------------------------------------------------------------------------- U.S. Government Agencies--continued Federal National Mortgage Association--continued $ 2,844,350 6.50%, 3/1/2029 $ 2,712,799 29,594,680 6.50%, 2/1/2029 28,225,926 2,400,000 6.50%, 1/25/2014 2,321,232 2,317,793 6.50%, 1/1/2028 2,210,595 2,952,485 6.29%, 4/1/2008 2,805,467 1,000,000 6.29%, 1/22/2008 940,000 2,526,272 6.28%, 6/1/2009 2,385,089 2,765,396 6.26%, 6/1/2009 2,530,338 987,661 6.20%, 9/1/2008 931,398 2,508,606 6.10%, 8/1/2008 2,352,217 3,435,195 6.10%, 3/1/2008 3,229,223 3,520,940 6.00%, 8/1/2013 3,372,392 8,976,633 6.00%, 7/1/2013 8,597,909 2,664,707 6.00%, 7/1/2013 2,552,283 1,748,288 6.00%, 6/1/2013 1,674,528 3,000,000 6.00%, 5/15/2008 2,852,820 10,353,790 6.00%, 4/1/2013 9,936,325 1,256,472 6.00%, 4/1/2011 1,208,173 845,705 6.00%, 1/1/2009 819,124 900,000 5.44%, 1/29/2001 892,827 ------------ Total 137,671,755 ------------ Government National Mortgage Association--9.7% 8 12.25%, 5/15/2014 9 6,437 11.00%, 9/15/2015 7,096 107 11.00%, 11/15/2015 118 1,010 11.00%, 11/15/2015 1,115 841 10.50%, 8/15/2017 913 469 10.50%, 11/15/2000 472 181 10.50%, 11/15/2000 185 744 10.50%, 10/15/2000 750 22,082 9.50%, 9/15/2020 23,486 8,729 9.50%, 9/15/2017 9,288 2,632 9.50%, 7/15/2021 2,799 1,370 9.50%, 7/15/2018 1,457 4,491 9.50%, 7/15/2016 4,779 2,279 9.50%, 7/15/2016 2,425 9,501 9.50%, 6/15/2020 10,105 67,325 9.50%, 6/15/2020 71,604 20,145 9.50%, 6/15/2016 21,436 906 9.50%, 5/15/2016 965 1,062 9.50%, 5/15/2016 1,130 10,806 9.50%, 5/15/2016 11,498 11,005 9.50%, 4/15/2020 11,704 15,695 9.50%, 4/15/2020 16,693
Principal Amount Value U.S. Government Agencies--continued Government National Mortgage Association--continued $ 15,209 9.50%, 12/15/2020 $ 16,176 98,323 9.50%, 12/15/2016 104,621 2,273 9.50%, 12/15/2016 2,419 14,014 9.50%, 11/15/2020 14,905 12,989 9.50%, 10/15/2020 13,814 6,323 9.50%, 10/15/2020 6,725 39,965 9.50%, 10/15/2020 42,505 8,773 9.50%, 10/15/2017 9,333 19,221 9.00%, 9/15/2022 20,206 161,720 9.00%, 9/15/2020 170,613 90,076 9.00%, 9/15/2019 95,142 18,342 9.00%, 9/15/2016 19,409 13,151 9.00%, 9/15/2016 13,916 1,025 9.00%, 9/15/2016 1,085 11,989 9.00%, 9/15/2016 12,656 8,235 9.00%, 9/15/2016 8,693 45,301 9.00%, 8/15/2021 47,736 5,707 9.00%, 8/15/2020 6,021 860 9.00%, 8/15/2016 910 71 9.00%, 8/15/2016 76 4,201 9.00%, 7/15/2022 4,416 68,426 9.00%, 7/15/2021 72,104 22,843 9.00%, 7/15/2021 24,070 58,032 9.00%, 7/15/2021 61,150 8,119 9.00%, 7/15/2018 8,581 235 9.00%, 7/15/2017 249 1,401 9.00%, 7/15/2016 1,482 7,628 9.00%, 7/15/2016 8,071 9,980 9.00%, 7/15/2016 10,535 9,985 9.00%, 6/15/2018 10,553 2,316 9.00%, 6/15/2017 2,449 6,323 9.00%, 6/15/2017 6,686 3,089 9.00%, 6/15/2016 3,261 11,996 9.00%, 6/15/2016 12,693 58,617 9.00%, 5/15/2022 61,621 8,275 9.00%, 5/15/2017 8,751 10,829 9.00%, 5/15/2016 11,431 5,340 9.00%, 5/15/2016 5,651 66,112 9.00%, 4/15/2022 69,501 1,939 9.00%, 4/15/2018 2,050 121,220 9.00%, 3/15/2020 127,886 156,087 9.00%, 3/15/2017 165,060 64,690 9.00%, 2/15/2021 68,166 12,467 9.00%, 2/15/2020 13,152 68,340 9.00%, 2/15/2017 72,269 15,821 9.00%, 12/15/2019 16,711
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Fixed Income Fund
Principal Amount Value - --------------------------------------------- U.S. Government Agencies--continued Government National Mortgage Association--continued $ 2,111 9.00%, 12/15/2016 $ 2,234 50,995 9.00%, 11/15/2020 53,799 7,896 9.00%, 11/15/2020 8,330 16,403 9.00%, 11/15/2020 17,305 10,182 9.00%, 11/15/2019 10,755 21,537 9.00%, 11/15/2016 22,789 21,497 9.00%, 11/15/2016 22,693 29,107 9.00%, 10/15/2020 30,707 21,135 9.00%, 10/15/2019 22,323 269 9.00%, 10/15/2016 284 17,084 9.00%, 10/15/2016 18,077 29,751 9.00%, 10/15/2016 31,406 15,688 9.00%, 10/15/2016 16,561 23,152 9.00%, 1/15/2021 24,396 48,066 9.00%, 1/15/2021 50,649 10,883 9.00%, 1/15/2021 11,468 23,924 9.00%, 1/15/2021 25,210 17,267 9.00%, 1/15/2021 18,195 18,363 9.00%, 1/15/2021 19,350 14,956 9.00%, 1/15/2020 15,778 43,665 9.00%, 1/15/2017 46,176 2,247 9.00%, 1/15/2017 2,376 16,559 9.00%, 1/15/2017 17,511 5,866 9.00%, 1/15/2017 6,186 133,983 9.00%, 1/15/2017 141,685 20,424 9.00%, 1/15/2017 21,598 269,928 8.50%, 9/15/2022 279,626 380,692 8.50%, 9/15/2022 394,370 653 8.50%, 9/15/2017 679 1,989 8.50%, 7/15/2016 2,069 16,745 8.50%, 6/15/2022 17,347 3,425 8.50%, 6/15/2017 3,560 54,626 8.50%, 6/15/2016 56,817 11,825 8.50%, 6/15/2016 12,300 7,515 8.50%, 6/15/2016 7,817 53,363 8.50%, 5/15/2022 55,280 19,412 8.50%, 5/15/2021 20,109 14,489 8.50%, 5/15/2016 15,070 3,060 8.50%, 4/15/2022 3,170 27,302 8.50%, 12/15/2021 28,283 203,613 8.50%, 11/15/2022 210,928 33,198 8.50%, 11/15/2021 34,391 12,695 8.50%, 11/15/2021 13,151 41,210 8.50%, 11/15/2021 42,691 88,695 8.00%, 9/15/2022 90,385 97,509 8.00%, 9/15/2022 99,367
Principal Amount Value U.S. Government Agencies--continued Government National Mortgage Association--continued $ 193,129 8.00%, 9/15/2022 $ 196,810 687,649 8.00%, 6/15/2023 700,755 7,459 8.00%, 6/15/2017 7,637 8,036 8.00%, 6/15/2004 8,157 198,855 8.00%, 5/15/2022 202,645 71,588 8.00%, 4/15/2022 72,952 463,242 8.00%, 4/15/2017 474,239 6,691 8.00%, 2/15/2017 6,849 128,188 7.50%, 8/15/2022 128,387 49,988 7.50%, 3/15/2023 50,051 92,871 7.50%, 2/15/2023 92,987 90,181 7.50%, 2/15/2023 90,294 84,675 7.50%, 2/15/2022 84,807 74,278 7.50%, 2/15/2022 74,394 118,283 7.50%, 12/15/2022 118,467 47,740 7.50%, 12/15/2022 47,815 83,574 7.50%, 12/15/2022 83,705 85,473 7.50%, 12/15/2022 85,606 95,177 7.50%, 11/15/2022 95,325 109,349 7.50%, 10/15/2022 109,519 623,927 7.50%, 1/15/2024 624,507 4,991,227 7.00%, 9/15/2029 4,874,233 571,702 7.00%, 6/15/2023 561,336 600,566 6.50%, 5/15/2011 589,240 939,891 6.50%, 5/15/2009 924,909 2,091,454 6.50%, 4/15/2024 2,004,533 3,475,341 6.50%, 3/15/2029 3,305,918 695,741 6.50%, 3/15/2024 666,826 3,434,975 6.50%, 11/20/2027 3,256,803 9,622,570 6.50%, 1/15/2029 9,153,470 978,801 6.00%, 5/15/2009 947,293 5,951,505 6.00%, 3/15/2029 5,497,702 3,659,109 6.00%, 2/15/2029 3,380,102 3,119,526 6.00%, 2/15/2029 2,881,662 3,009,508 6.00%, 2/15/2029 2,777,143 6,825,691 6.00%, 1/15/2029 6,305,231 ------------ Total 54,183,097 ------------ Total U.S. Government Agencies (identified cost $224,965,219) 217,473,266 ------------ U.S. Treasury Obligations--12.7% United States Treasury Notes--0.8% 550,000 (2)5.75%, 8/15/2003 543,296 4,000,000 (2)5.875%, 11/15/2005 3,935,000 ------------ Total 4,478,296 ------------
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Fixed Income Fund
Principal Amount or Shares Value - ---------------------------------------------------------------------------- U.S. Treasury Obligations--continued U.S. Treasury Bonds--11.9% $13,195,000 6.375%, 8/15/2027 $ 12,966,199 40,100,000 6.75%, 8/15/2026 41,240,444 10,720,000 8.00%, 11/15/2021 12,451,923 ------------ Total 66,658,566 ------------ Total U.S. Treasury Obligations (identified cost $74,632,993) 71,136,862 ------------ Closed-End Investment Companies--7.3% 265,250 2002 Target Term Trust, Inc. 3,597,453 356,845 Blackrock 1999 Term Trust 3,613,056 780,100 Blackrock 2001 Term Trust, Inc. 6,923,388 28,400 Blackrock Advantage Term Trust 257,375 570,900 Blackrock Strategic Term Trust, Inc. 5,031,056 1,379,000 Blackrock Target Term Trust 13,186,688
Principal Amount or Shares Value Closed-Ended Investment Companies--continued 3,200 Nations Government Income Term Trust 2003 $ 28,600 652,500 RCM Strategic Global Government Fund 5,750,156 14,400 TCW/DW Term Trust 2002 134,100 58,400 TCW/DW Term Trust 2003 532,900 296,300 Templeton Global Income Fund 1,814,838 ------------ Total Closed-End Investment Companies (identified cost $40,990,930) 40,869,610 ------------ (3) Repurchase Agreement--1.3% $ 7,355,266 Goldman Sachs Group, LP, 5.60%, dated 11/30/1999, due 12/1/1999 (at amortized cost) 7,355,266 ------------ Total Investments (identified cost $570,881,826) $552,479,138 ------------
(See Notes to Portfolios of Investments) - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Intermediate Fixed Income Fund (Class A Shares) Growth of $10,000 Invested in Wachovia Intermediate Fixed Income Fund (Class A Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Intermediate Fixed Income Fund (Class A Shares) (the "Fund") from January 29, 1993 (start of performance) to November 30, 1999 compared to the Lehman Brothers Govt./Corp. Intermediate Index (LBGCII).+ [Please see Appendix A24] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * Represents a hypothetical investment of $10,000 in the Fund after deducting the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge = $9,550). The Fund's performance assumes the reinvestment of all dividends and distributions. The LBGCII has been adjusted to reflect the reinvestment of dividends on securities in the index. **Total returns quoted reflect all applicable sales charges and contingent deferred sales charges. + The LBGCII is an unmanaged index generally representative of the performance of government and corporate bonds with maturities between 1 and 10 years. The LBGCII is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Intermediate Fixed Income Fund (Class Y Shares) Growth of $10,000 Invested in Wachovia Intermediate Fixed Income Fund (Class Y Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Intermediate Fixed Income Fund (Class Y Shares) (the "Fund") from March 29, 1998 (start of performance) to November 30, 1999 compared to the Lehman Brothers Govt./Corp. Intermediate Index (LBGCII).+ [Please see Appendix A25] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * The Fund's performance assumes the reinvestment of all dividends and distributions. The LBGCII has been adjusted to reflect the reinvestment of dividends on securities in the index. + The LBGCII is an unmanaged index generally representative of the performance of government and corporate bonds with maturities between 1 and 10 years. The LBGCII is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Intermediate Fixed Income Fund Portfolio of Investments November 30, 1999
Principal Amount Value - ----------------------------------------------------------------------------- Asset-Backed Securities--6.7% Finance--6.7% $2,000,000 AT&T Universal Card Master Trust 1995-2, Class A, 5.950%, 10/17/2002 $ 1,993,120 2,000,000 Chase Credit Card Owner Trust 1999-3, Class A, 6.660%, 10/15/2004 1,981,780 760,000 DLJ Commercial Mortgage Corp. 1999-CG1, Class A1B, 6.460%, 1/10/2009 721,065 1,135,000 Discover Card Master Trust I 1998-7, Class A, 5.600%, 5/16/2006 1,086,047 1,475,000 Distribution Financial Services RV Trust 1999-1, Class A5, 5.970%, 8/15/2013 1,446,813 100,000 MBNA Master Credit Card Trust II 1995-D, Class A, 6.050%, 11/15/2002 99,906 2,140,000 Premier Auto Trust 1998-1, Class A4, 5.700%, 10/6/2002 2,119,263 ------------ Total Asset-Backed Securities (identified cost $9,626,843) 9,447,994 ------------ Collateralized Mortgage Obligations--1.3% 1,581,817 Chase Manhattan Bank N.A., New York, Class A1, 7.134%, 8/15/2031 1,576,692 9,190,459 Nomura Asset Securities Corp. 1998-D6, Class ACS1, 1.650%, 3/17/2028 225,902 ------------ Total Collateralized Mortgage Obligations (identified cost $1,815,349) 1,802,594 ------------ Corporate Bonds--32.4% Bank--0.9% 750,000 Citicorp, Sr. MTN, Series C, 6.650%, 5/15/2000 751,455 500,000 Dresdner Bank AG, Frankfurt, Sub. Note, 6.625%, 9/15/2005 481,665 ------------ Total 1,233,120 ------------ Basic Materials--1.2% 750,000 Du Pont (E.I.) de Nemours & Co., Unsecd. Note, 6.750%, 10/15/2002 752,828
Principal Amount Value Corporate Bonds--continued Basic Materials--continued $1,000,000 Monsanto Co., Note, 6.000%, 7/1/2000 $ 997,460 ------------ Total 1,750,288 ------------ Communication Services--0.6% 900,000 AT&T Corp., Global Bond, 6.000%, 3/15/2009 826,299 ------------ Consumer Cyclicals--2.0% 750,000 Coca Cola Enterprises, Inc., 5.750%, 11/1/2008 677,355 1,000,000 Ford Motor Co., Note, 7.250%, 10/1/2008 998,200 1,300,000 Hasbro, Inc., 5.600%, 11/1/2005 1,188,382 ------------ Total 2,863,937 ------------ Consumer Non-Durables--0.7% 1,000,000 Philip Morris Cos., Inc., 7.650%, 7/1/2008 968,530 ------------ Finance--8.7% 1,000,000 BankBoston, N.A., Sub. Note, 6.500%, 12/19/2007 944,730 1,000,000 CIGNA Corp., Note, 7.400%, 5/15/2007 988,140 2,350,000 Ford Motor Credit Corp., Unsecd. Note, 6.250%, 11/8/2000 2,343,162 750,000 General Electric Capital Corp., Note, 5.500%, 4/15/2002 730,523 1,000,000 General Electric Capital Corp., Sr. Note, Series MTNA, 5.960%, 5/14/2001 992,130 1,000,000 General Electric Capital Corp., Sr. Note, Series MTNA, 6.875%, 4/15/2000 1,002,930 1,000,000 J.P. Morgan & Co., Inc., Sub. Note, 6.000%, 1/15/2009 912,260 1,000,000 J.P. Morgan & Co., Inc., Sub. Note, 7.625%, 9/15/2004 1,021,940 500,000 McDonnell Douglas Finance Corp., Sr. Note, Series MTN, 6.830%, 5/21/2001 501,480 1,000,000 Pitney Bowes Credit Corp., MTN, 6.780%, 7/16/2001 1,005,600 1,000,000 State Street Boston Corp., 5.950%, 9/15/2003 958,920
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Intermediate Fixed Income Fund
Principal Amount Value - ------------------------------------------------------------------------------- Corporate Bonds--continued Finance--continued $1,000,000 Union Planters Corp., Sub. Note, 6.500%, 3/15/2018 $ 897,740 ------------ Total 12,299,555 ------------ Financial Services--11.6% 2,000,000 CIT Group, Inc., Sr. Note, 5.800%, 3/26/2002 1,949,520 1,180,000 Chase Manhattan Corp., Sr. Note, 6.750%, 12/1/2004 1,169,026 2,000,000 Countrywide Home Loans, Inc., Company Guarantee, 6.050%, 3/1/2001 1,985,020 1,500,000 First Union Corp., Note, 6.625%, 6/15/2004 1,468,215 2,000,000 Fleet Credit Card LLC, Sub. Note, 7.000%, 8/1/2003 1,982,580 1,000,000 KFW International Finance, Company Guarantee, 8.250%, 11/30/2004 1,057,682 1,000,000 Lehman Brothers Holdings, Inc., Note, 6.890%, 10/10/2000 1,001,530 1,000,000 Lehman Brothers Holdings, Inc., Note, 7.375%, 5/15/2004 996,960 1,000,000 Merrill Lynch & Co., Inc., Bond, 6.000%, 7/15/2005 949,160 1,000,000 Merrill Lynch & Co., Inc., Note, 6.000%, 2/12/2003 974,920 1,000,000 Merrill Lynch & Co., Inc., Sr. MTN, Series B, 5.710%, 1/15/2002 979,280 1,000,000 Norwest Financial, Inc., Sr. Note, Series 2002, 7.875%, 2/15/2002 1,022,750 1,000,000 Salomon, Inc., Sr. Note, 7.300%, 5/15/2002 1,007,910 ------------ Total 16,544,553 ------------ Healthcare--0.7% 1,000,000 Bristol-Myers Squibb Co., Deb., 6.800%, 11/15/2026 940,920 ------------ Recreation--2.3% 3,250,000 Disney (Walt) Co., Bond, Series B, 6.750%, 3/30/2006 3,198,715 ------------ Retail--0.8% 265,000 Archer-Daniels-Midland Co., Note, 6.625%, 5/1/2029 230,510
Principal Amount Value Corporate Bonds--continued Retail--continued $1,000,000 Wal-Mart Stores, Inc., Note, 5.875%, 10/15/2005 $ 953,530 ------------ Total 1,184,040 ------------ Technology--0.3% 500,000 First Data Corp., Sr. MTN, Series D, 6.610%, 6/9/2000 500,855 ------------ Transportation--1.4% 1,000,000 Burlington Northern, Inc., Equip. Trust, Series 96AA, 7.460%, 9/24/2011 985,742 1,000,000 CSX Corp., Deb., 7.050%, 5/1/2002 999,340 ------------ Total 1,985,082 ------------ Utilities--1.2% 730,000 National Rural Utilities Cooperative Finance Corp., Collateral Trust, 5.750%, 11/1/2008 660,716 1,000,000 SCANA Corp., MTN Note, Series B, 7.440%, 10/19/2004 1,018,910 ------------ Total 1,679,626 ------------ Total Corporate Bonds (identified cost $48,349,435) 45,975,520 ------------ U.S. Government Agencies--32.8% Federal Farm Credit--1.4% 2,080,000 5.750%, 9/1/2005 1,983,467 ------------ Federal Home Loan Bank System--5.2% 1,000,000 5.280%, 1/6/2004 952,340 2,000,000 6.250%, 8/13/2004 1,970,940 1,500,000 6.405%, 4/10/2001 1,503,750 1,890,000 7.010%, 4/19/2000 1,894,725 1,030,000 8.090%, 12/28/2004 1,096,785 ------------ Total 7,418,540 ------------ Federal Home Loan Mortgage Corporation--1.7% 2,524,298 7.000%, 7/1/2029 2,468,284 ------------ Federal National Mortgage Association--19.9% 2,958,000 5.125%, 2/13/2004 2,801,788 2,000,000 5.460%, 11/3/2003 1,915,320 3,683,796 6.000%, 8/1/2013 3,528,377 1,000,000 6.240%, 9/7/2000 1,000,620 3,184,481 6.500%, 7/1/2013 3,113,818
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Intermediate Fixed Income Fund
Principal Amount Value - --------------------------------------------------------------------------- U.S. Government Agencies--continued Federal National Mortgage Association--continued $3,585,697 6.500%, 8/1/2028 $ 3,419,859 7,089,112 6.500%, 2/1/2029 6,761,241 1,500,000 6.710%, 7/24/2001 1,508,430 1,467,136 6.740%, 1/1/2004 1,452,435 2,746,682 7.000%, 9/1/2027 2,687,436 ------------ Total 28,189,324 ------------ Government National Mortgage Association--4.2% 1,485,940 6.000%, 2/15/2029 1,372,637 1,266,819 6.000%, 2/15/2029 1,170,224 1,222,141 6.000%, 2/15/2029 1,127,780 2,416,867 6.000%, 3/15/2029 2,232,581 ------------ Total 5,903,222 ------------ Other--0.4% 600,000 Israel AID, Note, Series 3-C, 6.60%, 2/15/2008 592,932 ------------ Total U.S. Government Agencies (identified cost $46,779,143) 46,555,769 ------------ U.S. Treasury Obligations--16.7% United States Treasury Bonds--4.1% 3,470,000 (2)6.125%, 11/15/2027 3,304,099 1,600,000 7.125%, 2/15/2023 1,706,000 675,000 7.250%, 5/15/2016 718,139 ------------ Total 5,728,238 ------------ United States Treasury Notes--12.6% 1,000,000 5.250%, 5/15/2004 966,090 1,000,000 5.625%, 5/15/2008 956,720 474,000 5.750%, 10/31/2000 473,630 335,000 5.750%, 8/15/2003 330,916 455,000 5.875%, 11/30/2001 453,935 1,000,000 5.875%, 9/30/2002 995,160 2,000,000 6.250%, 2/15/2003 2,008,120 3,705,000 6.375%, 8/15/2002 3,733,936 680,000 6.500%, 5/31/2002 687,439 900,000 6.500%, 8/15/2005 911,529 1,500,000 6.875%, 5/15/2006 1,547,805
Principal Amount or Shares Value U.S. Treasury Obligations--continued United States Treasury Notes--continued $4,150,000 7.000%, 7/15/2006 $ 4,310,813 500,000 7.750%, 2/15/2001 510,310 ------------ Total 17,886,403 ------------ Total U.S. Treasury Obligations (identified cost $23,951,998) 23,614,641 ------------ Closed-End Investment Companies--5.9% 26,155 2002 Target Term Trust, Inc. 354,727 98,427 Blackrock 1999 Term Trust, Inc. 996,573 235,965 Blackrock 2001 Term Trust, Inc. 2,094,189 146,167 Blackrock Strategic Term Trust, Inc. 1,288,097 104,905 Blackrock Target Term Trust, Inc. 1,003,154 50,000 TCW/DW Term Trust 2002 465,625 228,550 TCW/DW Term Trust 2003 2,085,519 ------------ Total Closed-End Investment Companies (identified cost $8,118,517) 8,287,884 ------------ (3) Repurchase Agreement--2.9% $4,155,232 Goldman Sachs Group, LP, 5.60%, dated 11/30/1999, due 12/1/1999 (at amortized cost) 4,155,232 ------------ Total Investments (identified cost $142,796,517) $139,839,634 ------------
(See Notes to Portfolios of Investments) - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Short-Term Fixed Income Fund (Class A Shares) Growth of $10,000 Invested in Wachovia Short-Term Fixed Income Fund (Class A Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Short-Term Fixed Income Fund (Class A Shares) (the "Fund") from May 7, 1993 (start of performance) to November 30, 1999 compared to the Merrill Lynch 1-3 Year U.S. Treasury Index.+ [Please see Appendix A26] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * Represents a hypothetical investment of $10,000 in the Fund after deducting the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge = $9,550) that was in effect prior to February 1, 1995. As of February 1, 1995, the Fund's maximum sales charge is 2.50%. The Fund's performance assumes the reinvestment of all dividends and distributions. The Merrill Lynch 1-3 Year U.S. Treasury Index has been adjusted to reflect the reinvestment of dividends on securities in the index. ** Total returns quoted reflect all applicable sales charges and contingent deferred sales charges. + The Merrill Lynch 1-3 Year U.S. Treasury Index is an unmanaged index tracking short-term U.S. government securities with maturities between 1 and 2.99 years. The index is produced by Merrill Lynch & Co., Inc. The Merrill Lynch 1-3 Year U.S. Treasury Index is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Short-Term Fixed Income Fund (Class Y Shares) Growth of $10,000 Invested in Wachovia Short-Term Fixed Income Fund (Class Y Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Short-Term Fixed Income Fund (Class Y Shares) (the "Fund") from July 23, 1996 (start of performance) to November 30, 1999 compared to the Merrill Lynch 1-3 Year U.S. Treasury Index.+ [Please see Appendix A27] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * The Fund's performance assumes the reinvestment of all dividends and distributions. The Merrill Lynch 1-3 Year U.S. Treasury Index has been adjusted to reflect the reinvestment of dividends on securities in the index. + The Merrill Lynch 1-3 Year U.S. Treasury Index is an unmanaged index tracking short-term U.S. government securities with maturities between 1 and 2.99 years. The index is produced by Merrill Lynch & Co., Inc. The Merrill Lynch 1-3 Year U.S. Treasury Index is not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Short-Term Fixed Income Fund Portfolio of Investments November 30, 1999
Principal Amount Value - ------------------------------------------------------------------------------ Asset-Backed Securities--2.0% $1,000,000 Distribution Financial Services RV Trust, Series 1999-2, Class A4, 6.48%, 10/15/2013 (identified cost $999,781) $ 989,250 ----------- Collateralized Mortgage Obligations--2.0% 969,323 Federal National Mortgage Association, Series 1993- 137, Class B, 5.85%, 7/25/2000 (identified cost $966,143) 963,866 ----------- Corporate Bonds--35.7% Banking & Finance--7.1% 1,000,000 Bank One, NA, 7.000%, 5/8/2000 1,001,570 2,500,000 NationsBank Corp., 5.750%, 3/15/2001 2,471,900 ----------- Total 3,473,470 ----------- Finance--14.3% 2,000,000 Bankers Trust Corp., MTN, 5.850%, 5/11/2000 1,996,980 2,000,000 General Motors Acceptance Corp., 6.850%, 6/17/2004 1,988,520 1,000,000 Household Finance Corp., MTN, 6.125%, 7/15/2002 977,930 2,000,000 Merrill Lynch & Co., Inc., 6.020%, 5/11/2001 1,982,020 ----------- Total 6,945,450 ----------- Health Services--5.1% 2,500,000 McKesson Corp., 6.600%, 3/1/2000 2,500,550 ----------- Technology--9.2% 1,500,000 Eastman Kodak Co., 6.500%, 8/15/2001 1,491,900 3,000,000 Xerox Corp., 5.750%, 7/21/2000 2,991,573 ----------- Total 4,483,473 ----------- Total Corporate Bonds (identified cost $17,523,395) 17,402,943 -----------
Principal Amount or Shares Value U.S. Government Agencies--20.6% Federal Home Loan Bank System--12.0% $6,000,000 5.735%, 7/22/2003 $ 5,842,500 ----------- Federal National Mortgage Association--8.6% 4,390,031 6.000%, 9/1/2013 4,204,816 ----------- Total U.S. Government Agencies (identified cost $10,346,202) 10,047,316 ----------- U.S. Treasury Obligations--25.4% United States Treasury Notes--25.4% 1,000,000 5.500%, 12/31/2000 995,470 1,000,000 5.500%, 1/31/2003 983,280 2,000,000 5.625%, 12/31/2002 1,975,320 3,000,000 5.750%, 4/30/2003 2,967,660 2,000,000 5.750%, 8/15/2003 1,975,620 200,000 6.250%, 8/31/2000 200,624 750,000 6.250%, 10/31/2001 753,165 500,000 6.250%, 8/31/2002 502,420 1,000,000 6.375%, 3/31/2001 1,005,000 1,000,000 6.500%, 5/31/2001 1,007,500 ----------- Total U.S. Treasury Obligations (identified cost $12,621,687) 12,366,059 ----------- Closed-End Investment Company--4.0% 192,301 Black Rock 1999 Term Trust (identified cost $1,785,515) 1,947,048 ----------- (3) Repurchase Agreement--9.0% $4,397,275 Goldman Sachs Group, LP, 5.600%, dated 11/30/1999, due 12/1/1999 (at amortized cost) 4,397,275 ----------- Total Investments (identified cost $48,639,998) $48,113,757 -----------
(See Notes to Portfolios of Investments) - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Georgia Municipal Bond Fund (Class A Shares) Growth of $10,000 Invested in Wachovia Georgia Municipal Bond Fund (Class A Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Georgia Municipal Bond Fund (Class A Shares) (the "Fund") from December 23, 1994 (start of performance) to November 30, 1999 compared to the Lehman Brothers State General Obligation Bond Index (LBSGOBI) and the Lehman Brothers Municipal Bond Index (LBMBI).+ [Please see Appendix A28] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * Represents a hypothetical investment of $10,000 in the Fund after deducting the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge = $9,550). The Fund's performance assumes the reinvestment of all dividends and distributions. The LBSGOBI and the LBMBI has been adjusted to reflect the reinvestment of dividends on securities in the index. ** Total returns quoted reflect all applicable sales charges and contingent deferred sales charges. + The LBSGOBI is an unmanaged index comprised of all state general obligation debt issues and is compiled without regard to maturities. These bonds are rated A or better and represent a variety of coupon ranges. The LBMBI is an unmanaged index generally representative of the performance of the municipal bond market as a whole. The investment adviser has elected to change the benchmark from LBSGOBI to LBMBI. The LBMBI is more representative of the securities typically held by the Fund. The indices are not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Georgia Municipal Bond Fund (Class Y Shares) Growth of $10,000 Invested in Wachovia Georgia Municipal Bond Fund (Class Y Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Georgia Municipal Bond Fund (Class Y Shares) (the "Fund") from July 23, 1996 (start of performance) to November 30, 1999 compared to the Lehman Brothers State General Obligation Bond Index (LBSGOBI) and the Lehman Brothers Municipal Bond Index (LBMBI).+ [Please see Appendix A28] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * The Fund's performance assumes the reinvestment of all dividends and distributions. The LBSGOBI and the LBMBI has been adjusted to reflect the reinvestment of dividends on securities in the index. + The LBSGOBI is an unmanaged index comprised of all state general obligation debt issues and is compiled without regard to maturities. These bonds are rated A or better and represent a variety of coupon ranges. The LBMBI is an unmanaged index generally representative of the performance of the municipal bond market as a whole. The investment adviser has elected to change the benchmark from LBSGOBI to LBMBI. The LBMBI is more representative of the securities typically held by the Fund. The indices are not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Georgia Municipal Bond Fund Portfolio of Investments November 30, 1999
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--97.0% Georgia--96.8% $1,530,000 Alpharetta, GA Development Authority, University and College Improvement Revenue Bonds, 4.80% (Original Issue Yield: 4.925%), 11/1/2018 AA $ 1,339,454 2,000,000 Atlanta, GA Downtown Development Authority, Refunding Bonds, 6.00% (Original Issue Yield: 6.10%), 10/1/2006 AA 2,096,380 100,000 Atlanta, GA Downtown Development Authority, Refunding Revenue Bonds, 6.25% (Original Issue Yield: 6.435%), 10/1/2016 AA 102,562 1,500,000 Atlanta, GA Downtown Development Authority, Revenue Bonds, 6.75% (Trust Co. Bank LOC)/(Original Issue Yield: 6.95%), 11/1/2014 Aa3 1,639,785 3,500,000 Atlanta, GA, GO UT (Series A), 6.125% (Original Issue Yield: 6.18%), 12/1/2023 AA 3,786,160 510,000 Atlanta, GA, Urban Residential Finance Authority, Dorm Facility Refunding Revenue Bonds, 5.70% (Morehouse College)/(MBIA INS), 12/1/2010 AAA 528,039 80,000 Brunswick, GA, Water & Sewer Refunding Revenue Bonds, 6.10% (MBIA INS)/(Original Issue Yield: 6.27%), 10/1/2019 AAA 83,522 1,490,000 Burke County, GA Development Authority, PCR Bonds, 7.50% (Oglethorpe Power Corp.)/(MBIA INS), 1/1/2003 AAA 1,558,346 50,000 Chatham County, GA School District, GO UT, 6.75% (MBIA INS), 8/1/2018 AAA 54,620
Principal Credit Amount Rating* Value Long-Term Municipals--continued Georgia--continued $ 500,000 Cherokee County, GA Water & Sewer Authority, Refunding Bonds, 6.90% (MBIA INS)/(Original Issue Yield: 6.982%), 8/1/2018 AAA $ 528,220 1,400,000 Cherokee County, GA Water & Sewer Authority, Revenue Bonds, 4.75% (Original Issue Yield: 4.99%), 8/1/2028 AAA 1,149,456 1,835,000 Cherokee County, GA Water & Sewer Authority, Revenue Bonds, 5.20% (MBIA INS)/(Original Issue Yield: 5.30%), 8/1/2025 AAA 1,683,282 1,790,000 Clayton County & Clayton County, GA Water Authority, Refunding Revenue Bonds, 5.20% (MBIA INS)/(Original Issue Yield: 5.30%), 5/1/2005 AAA 1,828,449 100,000 Cobb County, GA Solid Waste Management Authority, Revenue Bonds, 6.35%, 1/1/2009 AAA 107,688 3,750,000 Cobb County, GA, GO UT, 5.375% (Original Issue Yield: 5.50%), 1/1/2010 AAA 3,801,375 2,915,000 Cobb County, GA, Refunding Revenue Bonds (Series A), 5.20% (Original Issue Yield: 5.25%), 7/1/2005 AA 2,979,305 1,000,000 Cobb County, GA, Refunding Revenue Bonds, 5.125% (Original Issue Yield: 5.55%), 7/1/2008 AA 1,010,530 2,000,000 Cobb-Marietta, GA Coliseum & Exhibit Hall Authority, Refunding Revenue Bonds, 5.625% (MBIA LOC)/(Original Issue Yield: 5.70%), 10/1/2026 AAA 1,945,860 500,000 Coweta County, GA Development Authority, School Improvements, 3.70% (AMBAC)/(Original Issue Yield: 3.85%), 12/1/1999 AAA 499,995
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Georgia Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--continued Georgia--continued $1,140,000 Coweta County, GA School System, GO UT Refunding Bonds, 5.40% (Original Issue Yield: 5.50%), 2/1/2003 AAA $ 1,170,427 1,000,000 Dalton, GA, Refunding Revenue Bonds, 5.00% (MBIA INS), 1/1/2004 AAA 1,014,150 2,000,000 Dalton, GA, Revenue Bonds, 5.00%, 1/1/2004 AAA 2,027,560 150,000 De Kalb County, GA Development Authority, GO UT Bonds, 5.50% (Original Issue Yield: 5.60%), 1/1/2016 AA+ 146,782 3,075,000 De Kalb County, GA Development Authority, Refunding Bonds (Series A), 6.00% (Original Issue Yield: 6.086%), 10/1/2014 AA 3,178,136 2,000,000 De Kalb County, GA School District, GO UT Bonds (Series A), 6.25%, 7/1/2010 AA 2,192,260 200,000 De Kalb County, GA School District, GO UT Bonds (Series A), 6.25%, 7/1/2011 AA 219,464 1,000,000 De Kalb County, GA School District, GO UT Refunding Bonds, 5.60% (Original Issue Yield: 5.70%), 7/1/2008 AA 1,032,080 3,055,000 De Kalb County, GA Water & Sewer, Refunding Revenue Bonds, 5.25% (Original Issue Yield: 5.42%), 10/1/2023 AA 2,793,950 500,000 De Kalb County, GA, Refunding Revenue Bonds (Series A), 5.375% (Emory University), 11/1/2005 AA 518,160 100,000 Decatur, GA Housing Authority, Mortgage Refunding Revenue Bonds, 6.45% (FHA and MBIA INS)/(Original Issue Yield: 6.524%), 7/1/2025 AAA 102,417 500,000 Downtown Savannah, GA, Refunding Revenue Bonds (Series A), 4.95% (Original Issue Yield: 5.05%), 1/1/2006 AA 502,095
Principal Credit Amount Rating* Value Long-Term Municipals--continued Georgia--continued $1,995,000 Fayette County, GA School District, GO UT Bonds, 6.25%, 3/1/2005 A+ $ 2,132,974 160,000 Fayette County, GA, Water Revenue Bonds (Series B), 6.20% (FGIC INS)/(Original Issue Yield: 6.30%), 10/1/2022 AAA 170,528 60,000 Forsyth County, GA School District, GO UT Bonds, 6.70%, 7/1/2012 AA- 67,458 1,000,000 Forsyth County, GA School District, GO UT Bonds, 6.75%, 7/1/2016 AA- 1,117,010 1,000,000 Forsyth County, GA School District, GO, Revenue Bond, 5.00%, 2/1/2004 AA- 1,014,390 1,880,000 Fulton County, GA Building Authority, Refunding Bonds (Series A), 5.80% (Original Issue Yield: 5.90%), 1/1/2005 AA 1,968,604 25,000 Fulton County, GA School District, GO UT Bonds, 5.60% (Original Issue Yield: 5.65%), 1/1/2011 AA 26,302 5,250,000 Fulton County, GA Water & Sewage System, Revenue Bonds, 4.75%, 1/1/2020 AA- 4,503,293 475,000 Fulton County, GA Water & Sewage System, 6.25% (FGIC INS)/(Original Issue Yield: 6.425%), 1/1/2007 AAA 512,240 1,000,000 Fulton County, GA Water & Sewage System, Refunding Revenue Bonds, 5.25% (FGIC LOC)/(Original Issue Yield: 4.974%), 1/1/2014 AAA 973,270 300,000 Fulton County, GA Water & Sewage System, Revenue Refunding Bonds, 5.625% (FGIC INS)/(Original Issue Yield: 5.75%), 1/1/2001 AAA 304,560 2,000,000 Fulton De Kalb, GA Hospital Authority, Revenue Bonds, 5.50% (MBIA INS)/(Original Issue Yield: 5.85%), 1/1/2012 AAA 2,010,860
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Georgia Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--continued Georgia--continued $ 300,000 Georgia Medical Center Hospital Authority, Refunding Revenue Anticipation Certificates (Series C), 5.90% (Columbus Regional Healthcare System)/(MBIA INS)/(Original Issue Yield: 5.95%), 8/1/2001 AAA $ 307,755 285,000 Georgia Municipal Electric Authority, Electric Power Refunding Revenue Bonds (Series B), 6.125% (FGIC INS)/(Original Issue Yield: 6.30%), 1/1/2014 AAA 295,668 500,000 Georgia Municipal Electric Authority, Refunding Bonds (Series B), 6.375% (Original Issue Yield: 6.45%), 1/1/2016 A 509,725 1,000,000 Georgia Municipal Electric Authority, Refunding Bonds (Series EE), 6.00% (AMBAC INS)/(Original Issue Yield: 6.47%), 1/1/2020 AAA 1,001,700 505,000 Georgia State HFA, Refunding Revenue Bonds (Series A), 7.50% (FHA/VA mtgs GTD), 6/1/2017 AA+ 519,155 500,000 Georgia State HFA, Refunding Revenue SFM Bonds (Subseries A-2), 6.55% (FHA/VA mtgs GTD), 12/1/2027 AAA 507,965 500,000 Georgia State Municipal Gas Authority, Revenue Bonds, 6.00%, 7/1/2004 A- 524,935 1,000,000 Georgia State Municipal Gas Authority, Revenue Bonds, 6.30% (Original Issue Yield: 6.40%), 7/1/2009 A- 1,018,510 2,000,000 Georgia State, GO UT (Series D), 6.80%, 8/1/2005 AAA 2,212,080 1,000,000 Georgia State, GO UT Bonds (Series A), 6.00% (Original Issue Yield: 6.40%), 2/1/2007 AAA 1,038,060 1,300,000 Georgia State, GO UT Bonds (Series A), 6.25%, 4/1/2008 AAA 1,418,352
Principal Credit Amount Rating* Value Long-Term Municipals--continued Georgia--continued $1,000,000 Georgia State, GO UT Bonds (Series B), 5.95%, 3/1/2004 AAA $ 1,054,490 200,000 Georgia State, GO UT Bonds (Series B), 7.20%, 3/1/2006 AAA 225,954 765,000 Georgia State, GO UT Bonds (Series C), 7.25%, 7/1/2004 AAA 848,852 500,000 Georgia State, GO UT Bonds (Series D), 6.80%, 8/1/2000 AAA 509,520 200,000 Georgia State, GO UT Bonds (Series F), 6.50%, 12/1/2007 AAA 221,742 1,430,000 Georgia State, GO UT Bonds (Series A), 6.25%, 4/1/2007 AAA 1,553,609 500,000 Georgia State, GO UT Bonds (Series C), 6.50% (Original Issue Yield: 6.63%), 4/1/2006 AAA 547,495 1,895,000 Gwinnett County, GA Housing Authority, Refunding Revenue Bonds (Series A), 5.50% (FNMA COL), 4/1/2026 AAA 1,915,030 1,100,000 Gwinnett County, GA, Water & Sewage Utility Certificates of Participation, 8.40%, 8/1/2001 AAA 1,173,469 1,000,000 Hall County, GA School District, GO UT Refunding Bonds, 4.50% (Original Issue Yield: 5.20%), 11/1/2014 Aa3 869,970 1,000,000 Hart County, GA School District, GO UT, 4.25%, 4/1/2001 Aa2 1,000,020 3,600,000 Henry County, GA Water & Sewer Authority, Revenue Bond, 5.00% (AMBAC INS)/(Original Issue Yield: 5.32%), 2/1/2026 AAA 3,125,304 1,000,000 Henry County, GA School District, GO UT Bonds (Series A), 6.45%, 8/1/2011 A+ 1,095,750 1,000,000 Henry County, GA School District, GO UT Bonds, 5.625% (MBIA INS), 8/1/2007 AAA 1,039,880 1,000,000 Macon-Bibb County, GA Hospital Authority, Refunding Revenue Bond (Series A), 5.30% (FGIC INS), 8/1/2011 AAA 1,013,400
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Georgia Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--continued Georgia--continued $ 500,000 Macon-Bibb County, GA Hospital Authority, Refunding Revenue Bond (Series C), 5.25% (FGIC INS), 8/1/2011 AAA $ 504,525 400,000 Marietta, GA Development Authority, Revenue Bonds (Series B), 5.75% (Life College, Inc.)/(CGIC LOC)/(Original Issue Yield: 5.91%), 9/1/2014 AAA 404,320 3,425,000 Marietta, GA, GO UT (Series A) School Improvement Bonds, 4.50% (Original Issue Yield: 4.88%), 2/1/2019 AA- 2,842,476 500,000 Meriwether County, GA School District, GO UT Bonds, 7.00% (FSA INS), 2/1/2007 AAA 561,025 4,000,000 Metropolitan Atlanta GA Rapid Transit Authority, Refunding Revenue Bonds (Series A), 6.90% (MBIA LOC), 7/1/2020 AAA 4,440,000 400,000 Newton County School District, GA, GO UT Bonds, 5.625% (FGIC INS)/(Original Issue Yield: 5.70%), 2/1/2013 AAA 405,980 1,000,000 Paulding County, GA School District, GO UT, (Series A), 6.625% (Original Issue Yield: 6.75%), 2/1/2009 A 1,112,430 100,000 Peach County, GA School District, GO UT Bonds, 6.30% (MBIA INS)/(Original Issue Yield: 6.35%), 2/1/2014 AAA 108,809 2,000,000 Private Colleges & Universities Facilities of GA, Refunding Revenue Bonds, 5.625% (Agnes Scott College Project)/(Original Issue Yield: 5.70%), 6/1/2023 AA 1,921,960 1,500,000 Private Colleges & Universities Facilities of GA, Revenue Bonds, 5.00% (Agnes Scott College Project)/(MBIA LOC)/(Original Issue Yield: 5.06%), 6/1/2024 AAA 1,313,070
Principal Credit Amount Rating* Value Long-Term Municipals--continued Georgia--continued $2,800,000 Private Colleges & Universities Facilities of GA, University and College Improvements, 4.75% (Agnes Scott College Project)/(MBIA LOC)/ (Original Issue Yield: 5.079%), 6/1/2028 AAA $ 2,300,228 1,500,000 Rockdale County, GA School District, GO UT Bonds, 6.30%, 1/1/2007 A1 1,611,990 1,000,000 Rockdale County, GA School District, GO UT, 6.20%, 1/1/2006 A1 1,071,290 3,000,000 Rockdale County, GA Water & Sewer, (Series A), 5.375% (MBIA LOC), 7/1/2029 AAA 2,755,230 150,000 Savannah, GA Resources Recovery Development Authority, Refunding Revenue Bonds, 5.95% (Savannah Energy Systems Co.), 12/1/2002 A+ 155,450 2,335,000 Savannah, GA Resources Recovery Development Authority, Revenue Bonds, 6.30% (Savannah Energy Systems Co. Project), 12/1/2006 A+ 2,424,617 110,000 Savannah, GA Water & Sewage, Revenue Bonds, 5.10% (Original Issue Yield: 5.55%), 12/1/2010 AA- 109,205 5,000,000 Upper Oconee Basin, GA Water Authority, Revenue Bonds, 5.25% (FGIC LOC)/(Original Issue Yield: 5.41%), 7/1/2027 AAA 4,512,600 ------------ Total 110,525,593 ------------ Puerto Rico--0.2% 35,000 Puerto Rico Commonwealth Infrastructure Financing Authority, Revenue Bonds (Series A), 5.00% (AMBAC LOC)/(Original Issue Yield: 5.28%), 7/1/2028 AAA 30,751 30,000 Puerto Rico Electric Power Authority, Revenue Bonds (Series DD), 5.00% (MBIA INS)/(Original Issue Yield: 5.28%), 7/1/2028 AAA 26,358
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Georgia Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--continued Puerto Rico--continued $ 265,000 Puerto Rico Highway and Transportation Authority, Refunding Revenue Bonds (Series A), 5.00% (AMBAC LOC)/(Original Issue Yield: 5.16%), 7/1/2028 AAA $ 232,826 ------------ Total 289,935 ------------ Total Long-Term Municipals (identified cost $112,241,382) 110,815,528 ------------
Shares Value Open-End Investment Companies--1.4% 17,221 AIM Global Management S\T Investments $ 17,221 617 Dreyfus Tax Exempt Money Market Fund 617 152,086 Federated Tax-Free Obligations Fund 152,086 1,440,557 Fidelity Tax Exempt Money Market Fund 1,440,557 ------------ Total Open-End Investment Companies (at cost) 1,610,481 ------------ Total Investments (identified cost $113,851,863) $112,426,009 ------------
(See Notes to Portfolios of Investments) - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia North Carolina Municipal Bond Fund (Class A Shares) Growth of $10,000 Invested in Wachovia North Carolina Municipal Bond Fund (Class A Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia North Carolina Municipal Bond Fund (Class A Shares) (the "Fund") from December 23, 1994 (start of performance) to November 30, 1999 compared to the Lehman Brothers State General Obligation Bond Index (LBSGOBI) and the Lehman Brothers Municipal Bond Index (LBMBI).+ [Please see Appendix A30] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * Represents a hypothetical investment of $10,000 in the Fund after deducting the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge = $9,550). The Fund's performance assumes the reinvestment of all dividends and distributions. The LBSGOBI and the LBMBI has been adjusted to reflect the reinvestment of dividends on securities in the index. ** Total returns quoted reflect all applicable sales charges and contingent deferred sales charges. + The LBSGOBI is an unmanaged index comprised of all state general obligation debt issues and is compiled without regard to maturities. These bonds are rated A or better and represent a variety of coupon ranges. The LBMBI is an unmanaged index generally representative of the performance of the municipal bond market as a whole. The investment adviser has elected to change the benchmark from LBSGOBI to LBMBI. The LBMBI is more representative of the securities typically held by the Fund. The indices are not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia North Carolina Municipal Bond Fund (Class Y Shares) Growth of $10,000 Invested in Wachovia North Carolina Municipal Bond Fund (Class Y Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia North Carolina Municipal Bond Fund (Class Y Shares) (the "Fund") from July 23, 1996 (start of performance) to November 30, 1999 compared to the Lehman Brothers State General Obligation Bond Index (LBSGOBI) and the Lehman Brothers Municipal Bond Index (LBMBI).+ [Please see Appendix A31] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * The Fund's performance assumes the reinvestment of all dividends and distributions. The LBSGOBI and the LBMBI has been adjusted to reflect the reinvestment of dividends on securities in the index. + The LBSGOBI is an unmanaged index comprised of all state general obligation debt issues and is compiled without regard to maturities. These bonds are rated A or better and represent a variety of coupon ranges. The LBMBI is an unmanaged index generally representative of the performance of the municipal bond market as a whole. The investment adviser has elected to change the benchmark from LBSGOBI to LBMBI. The LBMBI is more representative of the securities typically held by the Fund. The indices are not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia North Carolina Municipal Bond Fund Portfolio of Investments November 30, 1999
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--96.8% North Carolina--95.3% $8,650,000 Appalachian State University, NC, Electricity, Light, Power, University and College Improvement Revenue Bonds, 6.20% (MBIA LOC)/(Original Issue Yield: 6.27%), 5/15/2024 AAA $ 9,348,660 1,030,000 Buncombe County, NC, GO UT Bonds, 4.90% (Original Issue Yield: 5.15%), 4/1/2014 AA 964,420 1,400,000 Carteret County, NC, GO UT Bonds, 5.40% (MBIA INS)/ (Original Issue Yield: 5.60%), 5/1/2015 AAA 1,373,386 1,150,000 Carteret County, NC, GO UT School Improvements, 5.40% (MBIA LOC)/(Original Issue Yield: 5.50%), 5/1/2012 AAA 1,164,386 1,300,000 Carteret County, NC, GO UT School Improvements, 5.40% (MBIA LOC)/(Original Issue Yield: 5.55%), 5/1/2013 AAA 1,304,498 1,305,000 Carteret County, NC, GO UT School Improvements, 5.40% (MBIA LOC)/(Original Issue Yield: 5.55%), 5/1/2014 AAA 1,296,544 1,000,000 Centennial Authority, NC, Revenue Bonds, 4.85% (FSA INS)/(Original Issue Yield: 4.95%), 9/1/2009 AAA 977,220 1,000,000 Charlotte, NC, (Series A) GO UT, 5.50%, 7/1/2005 AAA 1,034,630 1,960,000 Charlotte, NC, GO UT Bonds, 5.70%, 2/1/2007 AAA 2,066,291 2,000,000 Charlotte, NC, GO UT Refunding Bonds (Series A), 5.50%, 7/1/2004 AAA 2,065,320 1,500,000 Charlotte, NC, GO UT Refunding Bonds, 5.00% (Original Issue Yield: 3.95%), 2/1/2001 AAA 1,515,150 1,250,000 Charlotte, NC, GO UT Refunding Bonds, 5.00% (Original Issue Yield: 5.10%), 2/1/2009 AAA 1,253,100
Principal Credit Amount Rating* Value Long-Term Municipals--continued North Carolina--continued $ 840,000 Charlotte, NC, GO UT Refunding Bonds, 5.00% (Original Issue Yield: 5.15%), 2/1/2012 AAA $ 824,561 3,000,000 Charlotte, NC, GO UT Refunding Bonds, 5.40%, 6/1/2012 AAA 3,048,840 2,205,000 Charlotte, NC, GO UT Refunding Bonds, 5.50% (Original Issue Yield: 5.55%), 7/1/2004 AAA 2,277,015 900,000 Charlotte, NC, GO UT Water & Sewer Bonds (Series A), 5.30%, 4/1/2008 AAA 925,263 3,110,000 Charlotte, NC, GO UT Water & Sewer Bonds, 4.75%, 2/1/2001 AAA 3,132,610 9,200,000 Charlotte, NC, GO UT Water & Sewer Bonds, 5.60%, 5/1/2018 AAA 9,745,652 1,000,000 Charlotte, NC, GO UT, 5.00% (Original Issue Yield: 4.45%), 6/1/2003 AAA 1,019,770 1,000,000 Charlotte, NC, GO UT, 5.00% (Original Issue Yield: 5.10%), 2/1/2020 AAA 902,770 1,755,000 Charlotte, NC, GO UT, 5.00% (Original Issue Yield: 5.15%), 6/1/2024 AAA 1,554,790 3,675,000 Charlotte, NC, GO UT, 5.25% (Original Issue Yield: 4.35%), 2/1/2006 AAA 3,778,929 1,120,000 Charlotte, NC, GO UT, 5.50%, 5/1/2005 AAA 1,163,198 5,050,000 Charlotte, NC, GO UT, 5.80%, 2/1/2014 AAA 5,363,706 1,000,000 Charlotte, NC, GO UT, 5.90%, 2/1/2018 AAA 1,065,870 3,500,000 Charlotte, NC, Public Improvements, 5.375% (Original Issue Yield: 5.50%), 6/1/2013 AA 3,460,310
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia North Carolina Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--continued North Carolina--continued $2,000,000 Charlotte, NC, Refunding Bonds, 5.25% (AMBAC LOC)/(Original Issue Yield: 5.70%), 12/1/2020 AAA $ 1,852,560 960,000 Charlotte-Mecklenburg Hospital Authority, NC, Health System Refunding Revenue Bonds, 5.75% (Original Issue Yield: 6.498%), 1/1/2012 AA 969,149 1,140,000 Charlotte-Mecklenburg Hospital Authority, NC, Refunding Bonds, 5.75% (Original Issue Yield: 6.50%), 1/1/2012 AA 1,150,864 860,000 Charlotte-Mecklenburg Hospital Authority, NC, PRF, 5.75% (Original Issue Yield: 6.50%), 1/1/2012 AA 899,010 1,190,000 Charlotte-Mecklenburg Hospital Authority, NC, Refunding Bonds, 6.00% (Original Issue Yield: 6.25%), 1/1/2005 AA 1,237,231 3,950,000 Charlotte-Mecklenburg Hospital Authority, NC, Refunding Revenue Bonds, 5.00% (Original Issue Yield: 5.05%), 1/15/2012 AA 3,764,903 1,500,000 Charlotte-Mecklenburg Hospital Authority, NC, Refunding Revenue Bonds, 5.00% (Original Issue Yield: 5.30%), 1/15/2017 AA 1,338,525 735,000 Charlotte-Mecklenburg Hospital Authority, NC, Refunding Revenue Bonds, 6.00% (Original Issue Yield: 6.25%), 1/1/2005 AA 771,963 1,000,000 Charlotte-Mecklenburg Hospital Authority, NC, Revenue Bonds, 5.60% (Original Issue Yield: 5.70%), 1/15/2009 AA 1,023,170 2,250,000 Concord, NC, (Series A) Multiple Utility Improvement Revenue Bonds, 5.00% (MBIA INS), 12/1/2022 AAA 1,985,535
Principal Credit Amount Rating* Value Long-Term Municipals--continued North Carolina--continued $ 345,000 Concord, NC, Certificate of Participation, 5.60% (MBIA INS)/(Original Issue Yield: 5.70%), 6/1/2005 AAA $ 356,609 445,000 Concord, NC, Certificate of Participation, 5.40% (MBIA INS)/(Original Issue Yield: 5.50%), 6/1/2003 AAA 455,747 2,600,000 Concord, NC, Revenue Bonds (Series A), 5.00% (MBIA INS), 12/1/2017 AAA 2,362,724 2,250,000 Cumberland County, NC Civic Center Project, (Series A), 6.40% (AMBAC INS)/(Original Issue Yield: 6.62%), 12/1/2024 AAA 2,466,585 2,000,000 Cumberland County, NC Hospital Facilities, Refunding Revenue Bonds, 4.00%, 10/1/2002 A- 1,950,960 1,000,000 Cumberland County, NC Hospital Facilities, Refunding Revenue Bonds, 4.20% (Original Issue Yield: 4.25%), 10/1/2004 A- 958,530 210,000 Cumberland County, NC Hospital Facilities, Revenue Bonds, 6.00% (MBIA INS)/(Original Issue Yield: 6.84%), 10/1/2021 AAA 216,430 2,000,000 Cumberland County, NC Hospital Facilities, Refunding Revenue Bonds, 4.10%, 10/1/2003 A- 1,933,360 1,000,000 Cumberland County, NC, Certificate of Participation (Series A), 6.375%, Civic Center Project)/(AMBAC INS)/(Original Issue Yield: 6.50%), 12/1/2010 AAA 1,095,160 615,000 Currituck County, NC, GO UT Bonds, 5.40% (MBIA INS), 4/1/2009 AAA 632,896 100,000 Durham County, NC, GO UT Bonds, 5.75% (Original Issue Yield: 5.95%), 2/1/2009 AAA 104,202
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia North Carolina Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--continued North Carolina--continued $2,820,000 Durham County, NC, GO UT Bonds, 5.75% (Original Issue Yield: 5.95%), 2/1/2010 AAA $ 2,938,496 4,400,000 Durham County, NC, GO UT Public Improvement Bonds, 5.90%, 4/1/2012 AAA 4,582,512 1,810,000 Durham County, NC, Refunding Bonds, 5.00%, 5/1/2004 AA 1,835,340 2,130,000 Durham County, NC, Refunding Bonds, 5.00%, 5/1/2005 AA 2,153,579 2,235,000 Durham County, NC, Refunding Bonds, 5.00%, 5/1/2006 AA 2,251,383 1,000,000 Durham County, NC, Refunding Bonds, 5.00%, 5/1/2007 AA 1,002,110 1,500,000 Durham County, NC, Refunding Bonds, 5.00% (Original Issue Yield: 5.18%), 5/1/2014 AA 1,415,235 1,550,000 Durham, NC, GO UT Bonds, 5.20% (Original Issue Yield: 5.30%), 2/1/2008 AAA 1,582,457 2,000,000 Durham, NC, GO UT Revenue Bonds, 5.80% (Original Issue Yield: 5.95%), 2/1/2012 AAA 2,084,760 8,950,000 Fayetteville, NC Public Works Commission, Refunding Revenue Bonds, 4.75% (FGIC INS)/(Original Issue Yield: 5.23%), 3/1/2014 AAA 8,114,965 3,140,000 Forsyth County, NC, GO UT Bonds, 4.90% (Original Issue Yield: 5.00%), 3/1/2007 AAA 3,155,951 2,510,000 Forsyth County, NC, GO UT Bonds, 5.40% (Original Issue Yield: 5.65%), 6/1/2006 AAA 2,594,813 1,000,000 Forsyth County, NC, GO UT, 4.75%, 2/1/2005 AAA 1,006,090 160,000 Franklin County, NC, Certificates of Participation, 6.10% (Jail & School Project)/(FGIC INS)/(Original Issue Yield: 6.20%), 6/1/2003 AAA 168,290
Principal Credit Amount Rating* Value Long-Term Municipals--continued North Carolina--continued $ 310,000 Fremont, NC Housing Development Corp., First Lien Refunding Revenue Bonds, 6.75% (Torhunta Apts)/(FNMA COL), 7/15/2022 NR $ 318,764 1,050,000 Gaston County, NC, GO UT Bonds, 5.20% (AMBAC INS)/(Original Issue Yield: 5.35%), 3/1/2014 AAA 1,022,805 1,600,000 Gaston County, NC, GO UT Bonds, 5.20% (AMBAC INS)/(Original Issue Yield: 5.40%), 3/1/2015 AAA 1,538,432 2,115,000 Gaston County, NC, GO UT Bonds, 5.20% (AMBAC INS)/(Original Issue Yield: 5.40%), 3/1/2016 AAA 2,017,266 2,025,000 Gastonia, NC Combined Utilities System, Refunding Revenue Bonds, 4.75% (Original Issue Yield: 4.98%), 5/1/2015 AAA 1,805,368 2,000,000 Gastonia, NC Combined Utilities System, Refunding Revenue Bonds, 6.10% (MBIA INS)/(Original Issue Yield: 6.15%), 5/1/2019 AAA 2,152,620 100,000 Gastonia, NC Combined Utilities System, Revenue Bonds, 6.00% (MBIA INS)/(Original Issue Yield: 6.10%), 5/1/2014 AAA 107,235 500,000 Gastonia, NC, GO UT Bonds, 5.30% (FGIC INS)/(Original Issue Yield: 5.40%), 6/1/2009 AAA 511,045 500,000 Gastonia, NC, GO UT, 5.40% (MBIA INS), 5/1/2011 AAA 510,190 3,485,000 Greensboro, NC, Certificate of Participation (Series A), 5.625% (Original Issue Yield: 6.05%), 12/1/2015 AA 3,683,959 105,000 Greensboro, NC, Certificates of Participation, 6.65% (Coliseum Arena Expansion Project)/ (Original Issue Yield: 6.70%), 12/1/2004 AA 111,562
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia North Carolina Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--continued North Carolina--continued $2,200,000 Greensboro, NC, GO UT Bonds, 4.70% (Original Issue Yield: 4.80%), 4/1/2014 AAA $ 2,006,664 2,535,000 Greensboro, NC, GO UT Bonds, 4.70% (Original Issue Yield: 4.90%), 4/1/2016 AAA 2,253,032 2,455,000 Greensboro, NC, GO UT Bonds, 4.75% (Original Issue Yield: 4.95%), 4/1/2017 AAA 2,176,554 1,465,000 Greensboro, NC Enterprise System, Revenue Bonds, 6.50%, 6/1/2006 AA- 1,601,421 1,000,000 Greensboro, NC Enterprise System, Water & Sewer Improvements (Series A), 5.30% (MBIA INS)/(Original Issue Yield: 5.518%), 6/1/2015 AAA 964,070 2,500,000 Greensboro, NC Enterprise System, Water & Sewer Improvements (Series A), 5.375% (Original Issue Yield: 5.594%), 6/1/2019 AA- 2,361,550 1,000,000 Guilford County, NC, GO UT, 6.10%, 2/1/2000 AA+ 1,003,680 1,400,000 Guilford County, NC, GO UT, 6.10%, 2/1/2001 AA+ 1,431,304 1,735,000 Harnett County, NC, Certificates of Participation, 5.90% (AMBAC INS), 12/1/2000 AAA 1,768,173 500,000 Harnett County, NC, Certificates of Participation, 6.20% (AMBAC INS), 12/1/2009 AAA 532,405 600,000 High Point, NC, GO UT Revenue Bonds, 5.60%, 3/1/2008 AA 625,746 1,980,000 Iredell County, NC Iredell Memorial Hospital, 5.125% (AMBAC INS)/(Original Issue Yield: 5.30%), 10/1/2013 AAA 1,907,651 5,000,000 Iredell County, NC, Certificates of Participation, 6.125% (FGIC INS)/(Original Issue Yield: 6.23%), 6/1/2007 AAA 5,267,550
Principal Credit Amount Rating* Value Long-Term Municipals--continued North Carolina--continued $1,130,000 Lee County, NC, GO UT, 5.00% (MBIA INS)/(Original Issue Yield: 5.05%), 4/1/2009 AAA $ 1,129,503 1,725,000 Lee County, NC, GO UT, 5.00% (MBIA INS)/(Original Issue Yield: 5.15%), 4/1/2010 AAA 1,714,581 2,700,000 Lee County, NC, GO UT, 5.00% (MBIA INS)/(Original Issue Yield: 5.20%), 4/1/2011 AAA 2,664,225 100,000 Martin County, NC IFA, PCR Bonds, 6.80% (Weyerhaeuser Co.), 5/1/2024 A 103,398 1,925,000 Mecklenburg County, NC, GO UT (Series B), 4.40% (Original Issue Yield: 4.60%), 2/1/2013 AAA 1,717,466 2,000,000 Mecklenburg County, NC, GO UT Bonds (Series A), 4.40% (Original Issue Yield: 4.65%), 2/1/2014 AAA 1,754,560 8,435,000 Mecklenburg County, NC, GO UT Bonds (Series B), 4.90% (Original Issue Yield: 5.10%), 3/1/2011 AAA 8,252,382 3,500,000 Mecklenburg County, NC, GO UT Bonds, 4.10% (Original Issue Yield: 4.25%), 4/1/2003 AAA 3,462,130 4,405,000 Mecklenburg County, NC, GO UT Bonds, 4.80% (Original Issue Yield: 4.90%), 3/1/2009 AAA 4,330,115 4,000,000 Mecklenburg County, NC, GO UT Bonds, 5.00%, 4/1/2008 AAA 4,030,920 10,000,000 Mecklenburg County, NC, GO UT Bonds, 5.40%, 4/1/2007 AAA 10,307,400 3,670,000 Mecklenburg County, NC, GO UT, 4.40% (Original Issue Yield: 4.45%), 2/1/2011 AAA 3,379,703 13,000,000 Mecklenburg County, NC, GO UT, 4.40%, 2/1/2010 AAA 12,157,470 1,000,000 Moore County, NC, GO UT Bonds, 4.60% (MBIA INS)/(Original Issue Yield: 4.65%), 6/1/2011 AAA 940,370
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia North Carolina Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--continued North Carolina--continued $1,675,000 Moore County, NC, GO UT Public Improvements, 4.90% (MBIA INS)/(Original Issue Yield: 4.95%), 6/1/2015 AAA $ 1,544,601 1,600,000 Moore County, NC, GO UT Public Improvement, 4.90% (MBIA INS)/(Original Issue Yield: 4.90%), 6/1/2014 AAA 1,497,472 3,225,000 New Hanover County, NC Hospital, Revenue Bond, 4.75% (New Hanover Regal Medical)/ (Original Issue Yield: 5.23%), 10/1/2023 AAA 2,704,517 750,000 New Hanover County, NC PCR Financial Authority, Revenue Bond, 6.90% (Carolina Power & Light Co.), 4/1/2009 A 767,460 1,195,000 New Hanover County, NC, Certificate Participation, 4.80% (Original Issue Yield: 4.90%), 12/1/2009 AAA 1,161,982 1,250,000 New Hanover County, NC, Certificate Participation, 4.90% (MBIA LOC)/(Original Issue Yield: 5.00%), 12/1/2010 AAA 1,215,925 1,315,000 New Hanover County, NC, Certificate Participation, 5.00% (MBIA LOC)/(Original Issue Yield: 5.05%), 12/1/2011 AAA 1,286,570 2,475,000 New Hanover County, NC, GO UT Bonds, 4.80%, 2/1/2017 AA- 2,193,914 2,475,000 New Hanover County, NC, GO UT Bonds, 4.90%, 2/1/2018 AA- 2,205,967 1,000,000 North Carolina Eastern Municipal Power Agency, (Series B), 7.00% (Original Issue Yield: 6.25%), 1/1/2008 A 1,098,840 1,650,000 North Carolina Eastern Municipal Power Agency, Refunding Revenue Bond (Series A), 5.75% (FSA LOC)/(Original Issue Yield: 6.734%), 1/1/2019 AAA 1,611,637
Principal Credit Amount Rating* Value Long-Term Municipals--continued North Carolina--continued $ 100,000 North Carolina Educational Facilities Finance Agency, Refunding Revenue Bonds, 6.00% (Davidson College)/ (Original Issue Yield: 6.20%), 12/1/2012 AA $ 104,356 450,000 North Carolina Educational Facilities Finance Agency, Revenue Bonds (Series B), 4.25% (Duke University)/ (Original Issue Yield: 4.30%), 10/1/2003 AA+ 446,211 1,000,000 North Carolina Educational Facilities Finance Agency, Revenue Bonds (Series C), 6.75% (Duke University)/ (Original Issue Yield: 6.769%), 10/1/2021 AA+ 1,056,250 20,000 North Carolina HFA, Multi-family Refunding Revenue Bonds (Series B), 6.90% (FHA INS), 7/1/2024 NR 20,968 85,000 North Carolina HFA, Revenue Bonds (Series Z), 6.60%, 9/1/2026 AA 86,890 750,000 North Carolina HFA, Revenue Bonds, 6.20%, 3/1/2018 AA 757,140 2,275,000 North Carolina HFA, Single Family Revenue Bonds, 6.45%, 9/1/2014 AA 2,339,382 1,000,000 North Carolina Medical Care Commission, Refunding Revenue Bond, 5.00% (Original Issue Yield: 5.03%), 10/1/2004 AA 1,000,570 4,000,000 North Carolina Medical Care Commission, Refunding Revenue Bond, 5.40% (Original Issue Yield: 5.75%), 2/15/2011 A+ 3,972,120 6,335,000 North Carolina Medical Care Commission, Refunding Revenue Bond, 5.50% (Original Issue Yield: 6.10%), 5/1/2015 AA 6,164,715 1,355,000 North Carolina Medical Care Commission, Refunding Revenue Bonds, 4.625% (Rex Healthcare)/(Original Issue Yield: 4.93%), 6/1/2011 AAA 1,239,215
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia North Carolina Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------ Long-Term Municipals--continued North Carolina--continued $2,000,000 North Carolina Medical Care Commission, Refunding Revenue Bonds, 5.00% BANs, 6/1/2013 AAA $ 1,882,840 50,000 North Carolina Medical Care Commission, Refunding Revenue Bonds, 6.125% (Rex Hospital)/(Original Issue Yield: 6.219%), 6/1/2010 A+ 53,420 6,240,000 North Carolina Medical Care Commission, Revenue Bond (Series C), 5.25% (Duke University Hospital)/(Original Issue Yield: 5.72%), 6/1/2021 AA 5,696,309 8,000,000 North Carolina Medical Care Commission, Revenue Bond, 5.25% (Original Issue Yield: 5.72%), 5/1/2026 AA 7,098,400 1,000,000 North Carolina Medical Care Commission, Revenue Bonds (Series C), 5.25% (Duke University Hospital)/(Original Issue Yield: 5.65%), 6/1/2017 AA 936,380 5,000,000 North Carolina Medical Care Commission, Revenue Bonds, 4.75% (Firsthealth of the Carolina's)/(Original Issue Yield: 5.14%), 10/1/2026 AA- 4,049,050 525,000 North Carolina Medical Care Commission, Revenue Bonds, 5.20% (Moore Regional Hospital)/(FGIC INS)/(Original Issue Yield: 5.30%), 10/1/2013 AAA 504,483 1,000,000 North Carolina Medical Care Commission, Revenue Bonds, 7.00% (Duke University Hospital)/(Original Issue Yield: 7.08%), 6/1/2021 NR 1,058,480 1,095,000 North Carolina Medical Care Commission, Refunding Revenue Bonds, 5.10% (Wilson Memorial Hospital)/(AMBAC INS)/(Original Issue Yield: 5.25%), 11/1/2009 AAA 1,094,365
Principal Credit Amount Rating* Value Long-Term Municipals--continued North Carolina--continued $1,525,000 North Carolina Medical Care Commission, Refunding Revenue Bonds, 5.20% (Wilson Memorial Hospital)/(AMBAC INS)/(Original Issue Yield: 5.35%), 11/1/2010 AAA $ 1,525,030 850,000 North Carolina Medical Care Commission, Refunding Revenue Bonds, 7.375% (Presbyterian Hospital)/(United States Treasury PRF)/(Original Issue Yield: 7.417%), 10/1/2000 (Callable @102) AAA 890,171 3,680,000 North Carolina Municipal Power Agency No. 1, Refunding Revenue Bonds, 6.25% (Original Issue Yield: 6.477%), 1/1/2017 BBB+ 3,917,176 3,500,000 North Carolina State, (Series A), 4.70% (Original Issue Yield: 4.30%), 2/1/2003 AAA 3,534,160 2,225,000 North Carolina State, Capital Inprovement GO UT Bonds (Series A), 4.70%, 2/1/2006 AAA 2,221,685 5,000,000 North Carolina State, GO (Series A), 4.50%, 5/1/2006 AAA 4,924,550 3,000,000 North Carolina State, GO (Series B), 4.50% (Original Issue Yield: 4.55%), 6/1/2005 AAA 2,980,530 2,140,000 North Carolina State, GO UT (Series A), 6.10%, 3/1/2001 AAA 2,190,996 1,675,000 North Carolina State, GO UT (Series A), 4.50%, 5/1/2005 AAA 1,664,213 5,000,000 North Carolina State, GO UT (Series A), 5.20% (Original Issue Yield: 5.45%), 3/1/2015 AAA 4,822,550 700,000 North Carolina State, GO UT (Series A), 6.00% (Original Issue Yield: 5.85%), 3/1/2000 AAA 703,675 7,260,000 North Carolina State, GO UT Bonds (Series A), 4.70%, 2/1/2005 AAA 7,286,354
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia North Carolina Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--continued North Carolina--continued $5,000,000 North Carolina State, GO UT Bonds (Series A), 4.75%, 4/1/2006 AAA $ 5,009,200 5,000,000 North Carolina State, GO UT Bonds, 5.00%, 5/1/2011 AAA 4,950,500 1,000,000 North Carolina State, GO UT Bonds, 5.10%, 3/1/2003 AAA 1,021,690 1,000,000 North Carolina State, GO UT Refunding Bonds (Series C), 4.80% (North Carolina Prison Facilities)/(Original Issue Yield: 4.85%), 3/1/2009 AAA 983,000 2,850,000 North Carolina State, GO UT (Series A), 4.75% (Original Issue Yield: 5.00%), 2/1/2012 AAA 2,701,943 4,575,000 North Carolina State, GO UT, 4.60% (Original Issue Yield: 3.72%), 4/1/2003 AAA 4,604,966 3,500,000 North Carolina State, GO UT, 4.60% (Original Issue Yield: 3.82%), 4/1/2004 AAA 3,511,410 1,000,000 North Carolina State, GO UT, 5.10%, 3/1/2008 AAA 1,014,380 575,000 Onslow County, NC, GO UT Bonds, 5.70% (MBIA INS)/(Original Issue Yield: 5.85%), 3/1/2013 AAA 592,905 2,500,000 Orange County, NC, GO UT Bonds, 5.50% (Original Issue Yield: 5.75%), 2/1/2013 AA+ 2,524,325 1,000,000 Piedmont Triad Airport Authority, NC, Bonds (Series A), 6.50% (MBIA INS)/ (Original Issue Yield: 6.55%), 7/1/2000 AAA 1,014,790 4,845,000 Piedmont Triad Airport Authority, NC, Bonds, 5.00% (MBIA INS), 7/1/2008 AAA 4,846,114 1,250,000 Pitt County, NC, GO UT Bonds, 6.10% (Original Issue Yield: 6.25%), 6/1/2009 AA- 1,322,413 3,000,000 Pitt County, NC, Refunding Bonds, 5.25% (Pitt County Memorial Hospital)/(Original Issue Yield: 5.85%), 12/1/2021 NR 2,780,580
Principal Credit Amount Rating* Value Long-Term Municipals--continued North Carolina--continued $3,000,000 Pitt County, NC, Refunding Bonds, 5.30% (Pitt County Memorial Hospital)/(Original Issue Yield: 5.40%), 12/1/2009 Aaa $ 3,055,800 2,380,000 Pitt County, NC, Refunding Revenue Bonds, 5.10% (Pitt County Memorial Hospital)/ (Original Issue Yield: 5.20%), 12/1/2007 NR 2,413,558 3,635,000 Pitt County, NC, Refunding Revenue Bonds, 5.20% (Pitt County Memorial Hospital)/ (Original Issue Yield: 5.30%), 12/1/2008 NR 3,698,031 350,000 Raleigh, NC, Certificate Participation Refunding Bonds, 5.00% (Cabarrus Street Parking Facilities Project)/(Original Issue Yield: 5.10%), 12/1/2009 AA 343,658 230,000 Raleigh, NC, Certificate Participation Refunding Bonds, 5.10% (Cabarrus Street Parking Facilities Project)/(Original Issue Yield: 5.20%), 12/1/2010 AA 226,033 400,000 Raleigh, NC, GO UT Refunding Bonds, 6.40%, 3/1/2006 AAA 418,336 2,945,000 Raleigh, NC, Refunding Bonds, 5.00%, 4/1/2005 AAA 2,997,892 2,905,000 Raleigh, NC, Revenue Bonds, 4.75% (Original Issue Yield: 5.04%), 3/1/2024 AA+ 2,442,204 2,000,000 Raleigh, NC, Water Utility Improvement Revenue Bonds, 5.125% (Original Issue Yield: 5.61%), 3/1/2022 AA+ 1,801,140 800,000 Randolph County, NC, Certificates of Participation, 4.875% (MBIA INS)/(Original Issue Yield: 5.05%), 6/1/2006 AAA 802,208 500,000 Robeson County, NC, GO UT Refunding Revenue Bonds, 4.90% (AMBAC INS), 2/1/2007 AAA 501,615 1,025,000 Sanford, NC, GO UT Bonds, 4.90% (MBIA INS), 3/1/2009 AAA 1,015,232
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia North Carolina Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--continued North Carolina--continued $1,085,000 Shelby, NC Housing Development Corp., Mortgage Revenue Bonds, 6.10% (Hickory Creek Apartments)/ (FHA INS), 2/1/2023 AAA $ 1,088,841 2,500,000 University of North Carolina at Chapel Hill, Hospital Revenue Bonds, 5.25%, 2/15/2026 AA 2,219,050 6,220,000 University of North Carolina at Chapel Hill, Refunding Bonds, 5.00% (Original Issue Yield: 5.65%), 8/1/2011 AA 6,135,781 8,200,000 University of North Carolina at Chapel Hill, Utility Refunding Bonds, 5.00% (Original Issue Yield: 5.60%), 8/1/2010 AA 8,149,242 1,500,000 Wake County, NC Industrial Facilities & PCFA, (Series 1990A) Daily VRDNs (Carolina Power & Light Co.)/(Fuji Bank, Ltd., Tokyo LOC) AA- 1,500,000 1,000,000 Wake County, NC, GO UT Bonds, 4.50% (Original Issue Yield: 4.52%), 3/1/2008 AAA 968,760 3,000,000 Wake County, NC, GO UT Bonds, 4.50% (Original Issue Yield: 4.72%), 3/1/2010 AAA 2,837,940 4,000,000 Wake County, NC, GO UT Bonds, 4.50%, 3/1/2002 AAA 4,020,360 7,925,000 Wake County, NC, GO UT Bonds, 4.60% (Original Issue Yield: 4.87%), 3/1/2012 AAA 7,372,945 500,000 Wake County, NC, GO UT Refunding Bonds, 4.60% (Original Issue Yield: 4.70%), 4/1/2004 AAA 501,630 650,000 Wake County, NC, GO UT Refunding Bonds, 4.70% (Original Issue Yield: 4.80%), 4/1/2005 AAA 652,425 7,400,000 Wake County, NC, GO UT, 4.50% (Original Issue Yield: 4.62%), 3/1/2009 AAA 7,088,386
Principal Credit Amount Rating* Value Long-Term Municipals--continued North Carolina--continued $1,375,000 Wake County, NC, Hospital Revenue Bonds, 5.125% (MBIA INS)/(Original Issue Yield: 5.35%), 10/1/2026 AAA $ 1,259,308 825,000 Winston-Salem, NC Water & Sewer System, Refunding Bonds, 5.00%, 6/1/2012 AA+ 800,745 2,745,000 Winston-Salem, NC Water & Sewer System, Revenue Bonds, 4.80% (Original Issue Yield: 4.90%), 6/1/2013 AA+ 2,544,533 3,350,000 Winston-Salem, NC Water & Sewer System, Revenue Bonds, 4.875% (Original Issue Yield: 4.95%), 6/1/2014 AA+ 3,093,725 3,725,000 Winston-Salem, NC Water & Sewer System, Revenue Bonds, 5.00% (Original Issue Yield: 5.03%), 6/1/2016 AA+ 3,435,381 ------------ Total 422,436,746 ------------ Puerto Rico--1.5% 45,000 Puerto Rico Commonwealth Infrastructure Financing Authority, Revenue Bonds (Series A), 5.00% (AMBAC LOC)/(Original Issue Yield: 5.28%), 7/1/2028 AAA 39,537 400,000 Puerto Rico Electric Power Authority, (Series W), 5.00% (MBIA LOC)/(Original Issue Yield: 5.05%), 7/1/2004 AAA 408,604 2,955,000 Puerto Rico Electric Power Authority, Revenue Bonds (Series DD), 5.00% (MBIA INS)/(Original Issue Yield: 5.28%), 7/1/2028 AAA 2,596,233 4,045,000 Puerto Rico Highway and Transportation Authority, Refunding Revenue Bonds (Series A), 5.00% (AMBAC LOC)/(Original Issue Yield: 5.16%), 7/1/2028 AAA 3,553,897 ------------ Total 6,598,271 ------------ Total Long-Term Municipals (identified cost $432,684,518) 429,035,017 ------------
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia North Carolina Municipal Bond Fund
Shares Value - --------------------------------------------------------------------- Open-End Investment Companies--2.0% 3,836,588 AIM Global Management Money Market Fund $ 3,836,588 1,030,665 Dreyfus Tax Exempt Money Market Fund 1,030,665
Shares Value Open-End Investment Companies--continued 278,230 Federated Tax-Free Obligations Fund $ 278,230 3,796,045 Fidelity Tax Exempt Money Market Fund 3,796,045 ------------ Total Open-End Investment Companies (at cost) 8,941,528 ------------ Total Investments (identified cost $441,626,046) $437,976,545 ------------
(See Notes to Portfolios of Investments) - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia South Carolina Municipal Bond Fund (Class A Shares) Growth of $10,000 Invested in Wachovia South Carolina Municipal Bond Fund (Class A Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia South Carolina Municipal Bond Fund (Class A Shares) (the "Fund") from January 11, 1991 (start of performance) to November 30, 1999 compared to the Lehman Brothers State General Obligation Bond Index (LBSGOBI) and the Lehman Brothers Municipal Bond Index (LBMBI).+ [Please see Appendix A32] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * Represents a hypothetical investment of $10,000 in the Fund after deducting the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge = $9,550). The Fund's performance assumes the reinvestment of all dividends and distributions. The LBSGOBI and the LBMBI has been adjusted to reflect the reinvestment of dividends on securities in the index. ** Total returns quoted reflect all applicable sales charges and contingent deferred sales charges. + The LBSGOBI is an unmanaged index comprised of all state general obligation debt issues and is compiled without regard to maturities. These bonds are rated A or better and represent a variety of coupon ranges. The LBMBI is an unmanaged index generally representative of the performance of the municipal bond market as a whole. The investment adviser has elected to change the benchmark from LBSGOBI to LBMBI. The LBMBI is more representative of the securities typically held by the Fund. The indices are not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia South Carolina Municipal Bond Fund (Class Y Shares) Growth of $10,000 Invested in Wachovia South Carolina Municipal Bond Fund (Class Y Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia South Carolina Municipal Bond Fund (Class Y Shares) (the "Fund") from July 23, 1996 (start of performance) to November 30, 1999 compared to the Lehman Brothers State General Obligation Bond Index (LBSGOBI) and the Lehman Brothers Municipal Bond Index (LBMBI).+ [Please see Appendix A33] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * The Fund's performance assumes the reinvestment of all dividends and distributions. The LBSGOBI and the LBMBI has been adjusted to reflect the reinvestment of dividends on securities in the index. + The LBSGOBI is an unmanaged index comprised of all state general obligation debt issues and is compiled without regard to maturities. These bonds are rated A or better and represent a variety of coupon ranges. The LBMBI is an unmanaged index generally representative of the performance of the municipal bond market as a whole. The investment adviser has elected to change the benchmark from LBSGOBI to LBMBI. The LBMBI is more representative of the securities typically held by the Fund. The indices are not adjusted to reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia South Carolina Municipal Bond Fund Portfolio of Investments November 30, 1999
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--98.4% South Carolina--98.1% $ 540,000 Barnwell County, SC School District No. 45, GO UT Refunding Bonds, 5.60% (AMBAC INS)/(State Aid Withholding LOC)/ (Original Issue Yield: 5.65%), 2/1/2012 AAA $ 548,710 570,000 Barnwell County, SC School District No. 45, GO UT Refunding Bonds, 5.60% (AMBAC INS)/(State Aid Withholding LOC)/ (Original Issue Yield: 5.70%), 2/1/2013 AAA 575,478 850,000 Barnwell County, SC School District No. 45, GO UT, 5.40% (Original Issue Yield: 5.45%), 2/1/2009 AAA 866,881 1,600,000 Beaufort County, SC School District, GO UT, (Series B), 4.85% (MBIA INS), 3/1/2004 AAA 1,614,880 1,300,000 Beaufort County, SC School District, GO UT, 4.70%, 3/1/2006 AA 1,289,288 500,000 Beaufort County, SC, Certificate of Participation, 5.00% (Hilton Head Airport), 7/1/2001 NR 503,575 675,000 Beaufort County, SC, Certificates of Participation, 7.125% (AMBAC INS)/ (Original Issue Yield: 7.45%), 6/1/2012 AAA 698,976
Principal Credit Amount Rating* Value Long-Term Municipals--continued South Carolina--continued $ 2,855,000 Beaufort-Jasper, SC Water & Sewer Authority, Waterworks and Sewer System Revenue Bonds, 5.90% (FGIC INS)/(Original Issue Yield: 6.00%), 3/1/2016 AAA $ 2,884,035 750,000 Berkeley County, SC Pollution Control Facilities, 6.50% (South Carolina Electric and Gas), 10/1/2014 A 784,920 1,500,000 Berkeley County, SC Water & Sewer, Refunding Revenue Bonds, 5.50% (MBIA INS)/(Original Issue Yield: 5.55%), 6/1/2013 AAA 1,507,410 2,420,000 Berkeley County, SC Water & Sewer, Refunding Revenue Bonds, 5.55% (MBIA INS)/(Original Issue Yield: 5.60%), 6/1/2014 AAA 2,411,651 1,040,000 Berkeley County, SC Water & Sewer, Refunding Revenue Bonds, 6.55% (MBIA INS), 6/1/2002 AAA 1,091,574 1,000,000 Camden, SC Public Utility, Revenue Refunding Bonds, 5.50% (MBIA INS)/ (Original Issue Yield: 5.80%), 3/1/2022 AAA 946,550 2,000,000 Cayce SC, Water and Sewer, Refunding Revenue Bond, 5.25% (AMBAC INS)/ (Original Issue Yield: 5.65%), 7/1/2015 AAA 1,906,760
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia South Carolina Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------ Long-Term Municipals--continued South Carolina--continued $ 1,105,000 Charleston County, SC Airport District, Airport System Refunding Revenue Bonds, 4.75% (MBIA INS), 7/1/2015 AAA $ 981,240 1,950,000 Charleston County, SC Park & Recreational Community, Go UT, 5.20% (Original Issue Yield: 5.25%), 2/1/2002 AA- 1,984,573 1,000,000 Charleston County, SC School District, Certificate of Participation, 5.625% (Original Issue Yield: 5.761%), 2/1/2003 A 1,018,150 3,000,000 Charleston County, SC School District, GO UT School Improvement, 4.00%, 2/1/2002 AA 2,976,990 5,500,000 Charleston County, SC, 5.50% (Charleston Public Facilities Corp.)/(MBIA INS)/ (Original Issue Yield: 5.70%), 12/1/2015 AAA 5,394,015 3,495,000 Charleston County, SC, 6.00% (MBIA LOC)/ (Original Issue Yield: 5.40%), 12/1/2009 AAA 3,734,827 500,000 Charleston County, SC, 7.05%, 2/1/2002 A 512,205 3,260,000 Charleston, SC Waterworks and Sewer, 5.00% (MBIA INS), 1/1/2022 AAA 2,865,540 1,000,000 Charleston, SC Waterworks and Sewer, 6.00% (Original Issue Yield: 6.242%), 1/1/2012 AA- 1,032,580
Principal Credit Amount Rating* Value Long-Term Municipals--continued South Carolina--continued $ 2,000,000 Charleston, SC Waterworks and Sewer, Refunding Revenue Bond, 5.50% (Original Issue Yield: 6.10%), 1/1/2008 AA- $ 2,018,900 7,030,000 Charleston, SC Waterworks and Sewer, Refunding Revenue Bond, 6.00% (AMBAC INS)/(Original Issue Yield: 6.201%), 1/1/2016 AAA 7,127,717 2,000,000 Charleston, SC Waterworks and Sewer, Refunding Revenue Bond, 6.00% (Original Issue Yield: 6.285%), 1/1/2018 AA- 2,013,160 4,295,000 Charleston, SC Waterworks and Sewer, Refunding Revenue Bonds, 5.125%, 1/1/2013 AA- 4,196,773 9,500,000 Charleston, SC Waterworks and Sewer, Revenue Refunding Bonds, 4.50% (FGIC LOC)/(Original Issue Yield: 5.03%), 1/1/2024 AAA 7,568,460 1,900,000 Charleston, SC, Certificates of Participation, 5.00% (AMBAC INS)/ (Original Issue Yield: 5.39%), 9/1/2015 AAA 1,741,483 1,000,000 Charleston, SC, Certificates of Participation, 7.10% (MBIA INS)/(United States Treasury PRF), 6/1/2001 (Callable @102) AAA 1,059,710 250,000 Charleston, SC, GO Bonds (Series A), 6.30%, 9/1/2005 AA 262,367
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia South Carolina Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------ Long-Term Municipals--continued South Carolina--continued $ 1,155,000 Chester County, SC School District, GO UT, 5.30% (AMBAC INS)/(Original Issue Yield: 5.45%), 2/1/2011 AAA $ 1,157,957 875,000 Chester County, SC School District, GO UT, 6.85% (United States Treasury PRF)/ (Original Issue Yield: 6.95%), 2/1/2012 AA 896,665 1,140,000 Chester County, SC School District, GO UT, 5.30% (AMBAC INS)/(Original Issue Yield: 5.50%), 2/1/2012 AAA 1,130,743 1,125,000 Chester County, SC School District, GO UT, 6.85% (United States Treasury PRF)/ (Original Issue Yield: 6.90%), 2/1/2000 (Callable @102) AA 1,152,855 1,000,000 Clover, SC School District No 2 York County, GO UT, 6.00%, 2/1/2001 AA 1,019,700 2,785,000 Clover, SC School District No 2 York County, GO UT, 6.10%, 2/1/2002 AA 2,881,974 840,000 College Francis Marion SC, Revenue State College Board Trustees, Refunding Revenue Bond, 7.00%, 4/1/2001 864,998 1,000,000 Columbia, SC Waterworks & Sewer System, Refunding Revenue Bond, 5.30% (Original Issue Yield: 5.50%), 2/1/2006 AA 1,021,430 1,705,000 Columbia, SC Waterworks & Sewer System, Refunding Revenue Bond, 6.50% (Original Issue Yield: 6.55%), 2/1/2002 AA 1,778,213
Principal Credit Amount Rating* Value Long-Term Municipals--continued South Carolina--continued $ 2,970,000 Columbia, SC Waterworks & Sewer System, Refunding Revenue Bonds, 5.70%, 2/1/2010 AA $ 3,115,797 2,160,000 Columbia, SC Waterworks & Sewer System, Revenue Bonds, 5.00%, 2/1/2003 AA 2,193,026 2,000,000 Columbia, SC, Parking Facilities Refunding Revenue Bonds, 5.875% (AMBAC INS)/ (Original Issue Yield: 6.007%), 12/1/2013 AAA 2,055,380 1,250,000 Dillon County SC, Health Facilities, Refunding Revenue Bond, 6.25% (MBIA INS), 6/1/2008 AAA 1,326,812 1,065,000 Dorchester County, SC School District No. 002, GO UT Bonds, 5.125% (FGIC INS)/ (Original Issue Yield: 5.25%), 2/1/2012 AAA 1,042,294 3,000,000 Dorchester County, SC School District No. 002, GO UT Bonds, 5.20% (FGIC INS), 2/1/2018 AAA 2,783,340 2,250,000 Dorchester County, SC School District No. 002, GO UT Bonds, 5.20% (FGIC INS)/ (Original Issue Yield: 5.35%), 2/1/2017 AAA 2,104,965 1,000,000 Dorchester County, SC School District No. 002, GO UT, 5.50% (AMBAC INS)/ (Original Issue Yield: 5.55%), 1/1/2005 AAA 1,028,450 870,000 Edgefield County, SC School District, GO UT Bonds, 6.40% (FSA INS)/(Original Issue Yield: 6.60%), 2/1/2009 AAA 933,762
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia South Carolina Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--continued South Carolina--continued $ 1,155,000 Fairfield County, SC School District, Certificates of Participation, 5.50% (Fairfield Primary Geiger)/(Asset Guaranty GTD)/ (Original Issue Yield: 5.60%), 3/1/2007 AA $ 1,170,396 2,000,000 Fairfield County, SC, PCR Bonds, 6.50% (South Carolina Electric and Gas), 9/1/2014 A+ 2,130,840 1,000,000 Fairfield County, SC, PCR Bond, 6.50% (South Carolina Electric and Gas)/ (MBIA INS), 9/1/2014 AAA 1,068,110 1,000,000 Florence County, SC Hospital, Refunding Revenue Bond, 5.25% (FGIC INS)/(Original Issue Yield: 5.457%), 11/1/2009 AAA 1,001,720 1,500,000 Florence County, SC Hospital, Revenue Bonds, 4.75% (Mcleod Regional Medical Center)/(MBIA INS)/ (Original Issue Yield: 4.75%), 11/1/2027 AAA 1,206,345 500,000 Florence County, SC Hospital, Revenue Bonds, 6.75% (Mcleod Regional Medical Center)/(FGIC INS)/ (Original Issue Yield: 7.00%), 11/1/2010 AAA 522,275 1,485,000 Florence County, SC, Law Enforcement Control Project, 5.70% (AMBAC INS)/ (Original Issue Yield: 5.90%), 3/1/2003 AAA 1,537,242
Principal Credit Amount Rating* Value Long-Term Municipals--continued South Carolina--continued $ 1,220,000 Florence County, SC, Law Enforcement Control Project, 6.00% (AMBAC INS)/ (Original Issue Yield: 6.15%), 3/1/2006 AAA $ 1,278,218 1,600,000 Florence, SC Water & Sewer, Refunding Revenue Bond, 5.20% (AMBAC INS)/ (Original Issue Yield: 5.35%), 3/1/2007 AAA 1,620,016 3,805,000 Grand Strand Water & Sewage Authority, SC, Revenue Refunding Bonds, 6.375% (South Carolina Waterworks & Sewer System)/ (MBIA INS)/(Original Issue Yield: 6.508%), 6/1/2012 AAA 4,203,003 1,800,000 Grand Strand Water & Sewage Authority, SC, Waterworks & Sewer System Revenue Refunding Bonds, 6.00% (MBIA INS)/ (Original Issue Yield: 6.595%), 6/1/2019 AAA 1,805,994 1,230,000 Greenville County, SC, Certificate of Participation, PRF, 6.80% (AMBAC INS), 3/1/2005 AAA 1,292,140 500,000 Greenville County, SC, IRB, 7.10% (Lockheed Aeromod Center Incorporated Project), 11/1/2011 BBB- 518,855 1,000,000 Greenville, SC Hospital System Facilities, Refunding Revenue Bond, (Series A), 5.75% (Original Issue Yield: 6.00%), 5/1/2014 AA 998,490
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia South Carolina Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--continued South Carolina--continued $10,250,000 Greenville, SC Hospital System Facilities, Refunding Revenue Bonds (Series B), 5.25% (Original Issue Yield: 6.125%), 5/1/2023 AA $ 9,129,983 600,000 Greenville, SC Hospital System Facilities, Refunding Revenue Bonds, 5.75% (Original Issue Yield: 5.95%), 5/1/2013 AA 603,348 10,480,000 Greenville, SC Hospital System Facilities, Revenue Bonds (Series B), 5.25% (Original Issue Yield: 6.076%), 5/1/2017 AA 9,621,269 760,000 Greenville, SC Hospital System Facilities, Revenue Bonds, 7.00% (Greenville Health Corp.)/(Original Issue Yield: 7.454%), 5/1/2017 AAA 784,464 2,000,000 Greenville, SC Waterworks Revenue, Revenue Bonds, 5.50% (Original Issue Yield: 5.60%), 2/1/2022 AA 1,902,540 1,020,000 Greenwood County, SC Hospital, Refunding Revenue Bond, 5.875% (Self Memorial Hospital)/(MBIA INS)/ (Original Issue Yield: 6.112%), 10/1/2017 1,017,674 1,400,000 Greenwood SC, Combined Public Utility, Refunding Revenue Bond, 5.35% (AMBAC INS)/ (Original Issue Yield: 5.45%), 12/1/2005 AAA 1,445,276
Principal Credit Amount Rating* Value Long-Term Municipals--continued South Carolina--continued $ 1,320,000 Greenwood SC, Combined Public Utility, Refunding Revenue Bond, 5.70% (AMBAC INS), 12/1/2010 AAA $ 1,354,069 1,125,000 Greer, SC Combined Utility System, Revenue Bonds, 4.75% (AMBAC LOC)/(Original Issue Yield: 4.85%), 9/1/2011 AAA 1,064,227 1,000,000 Hilton Head Island, SC Public Facilities Corp., Certificates of Participation, 5.40% (AMBAC INS)/ (Original Issue Yield: 5.599%), 3/1/2009 AAA 1,020,040 2,000,000 Hilton Head Public Services District No. 1, SC, Water Workes & Sewer Refunding Revenue Bond, 5.50% (MBIA INS)/(Original Issue Yield: 5.80%), 8/1/2015 AAA 1,971,980 4,000,000 Hilton Head Public Services District No. 1, SC, Waterworks and Sewer Systems Revenue Bonds, 5.50% (MBIA INS)/(Original Issue Yield: 5.85%), 8/1/2020 AAA 3,821,480 2,350,000 Lancaster County, SC School District, GO UT, 5.25% (FSA INS)/ (Original Issue Yield: 5.39%), 3/1/2014 AAA 2,277,597 1,960,000 Lancaster County, SC School District, GO UT, 6.50% (MBIA INS)/(Original Issue Yield: 6.599%), 7/1/2008 AAA 2,096,259
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia South Carolina Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------ Long-Term Municipals--continued South Carolina--continued $ 3,650,000 Lancaster County, SC Water & Sewer District, Refunding Revenue Bond, 5.20% (FGIC INS)/(Original Issue Yield: 5.32%), 5/1/2015 AAA $ 3,459,580 1,030,000 Laurens County, SC Health Care Systems, GO UT, 5.70% (MBIA INS), 1/1/2008 AAA 1,055,287 1,025,000 Laurens County, SC School District Number 055, GO UT, 5.50% (FGIC INS), 3/1/2016 AAA 1,006,027 1,395,000 Laurens, SC Public Utility, Refunding Revenue Bond, 5.00% (FGIC INS)/(Original Issue Yield: 5.393%), 1/1/2018 AAA 1,251,468 655,000 Lexington & Richland Counties, SC School District No. 005, GO UT Bonds, 5.05% (MBIA INS), 3/1/2005 AAA 664,753 4,000,000 Lexington County, SC Health Services District, Inc., Refunding Revenue Bonds, 5.125% (FSA INS)/(Original Issue Yield: 5.50%), 11/1/2021 AAA 3,516,400 1,210,000 Lexington County, SC Health Services District, Inc., Revenue Bond, 6.60% (FSA INS)/(Original Issue Yield: 6.65%), 10/1/2001 AAA 1,260,167
Principal Credit Amount Rating* Value Long-Term Municipals--continued South Carolina--continued $ 2,500,000 Lexington County, SC Health Services District, Inc., Revenue Bonds, 5.125% (FSA INS)/(Original Issue Yield: 5.53%), 11/1/2026 AAA $ 2,157,475 370,000 Lexington County, SC School Distict Number 001, Prerefunded Certificate Participation,, 6.90% (MBIA INS), 9/1/2003 AAA 393,162 805,000 Medical University of South Carolina, Hospital Facilities Revenue Bonds, 5.25% (MBIA INS)/(Original Issue Yield: 5.25%), 7/1/2004 AAA 824,875 3,750,000 North Charleston, SC Sewer District, Refunding Revenue Bond, 6.375% (MBIA INS)/(Original Issue Yield: 6.508%), 7/1/2012 AAA 4,143,900 3,100,000 North Charleston, SC Sewer District, Refunding Revenue Bonds (Series A), 6.00% (MBIA INS)/ (Original Issue Yield: 6.593%), 7/1/2018 AAA 3,113,392 500,000 North Charleston, SC Sewer District, Revenue Bonds (Series B), 6.00% (MBIA INS)/ (Original Issue Yield: 6.593%), 7/1/2018 AAA 519,765 2,075,000 North Charleston, SC, Certificate of Participation, 5.50% (FGIC INS)/(Original Issue Yield: 5.65%), 1/1/2002 AAA 2,122,227
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia South Carolina Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------ Long-Term Municipals--continued South Carolina--continued $ 1,670,000 North Charleston, SC, GO UT, 5.50% (Original Issue Yield: 5.60%), 8/1/2006 AA- $ 1,725,210 1,000,000 North Charleston, SC, GO UT, 5.50%, 8/1/2005 AA- 1,038,080 275,000 Oconee County, SC School District, GO UT Bonds, 5.10% (MBIA INS)/(Original Issue Yield: 5.50%), 9/1/2013 AAA 265,309 1,000,000 Oconee County, SC School District, GO UT, 5.00% (Original Issue Yield: 5.35%), 9/1/2010 AAA 986,440 1,155,000 Oconee County, SC School District, GO UT, 5.10% (Original Issue Yield: 5.40%), 9/1/2011 AAA 1,140,355 1,090,000 Oconee County, SC School District, GO UT, 5.10% (Original Issue Yield: 5.45%), 9/1/2012 AAA 1,065,246 2,500,000 Oconee County, SC, PCR Refunding Bonds, 5.80% (Duke Energy Corp.), 4/1/2014 AA- 2,515,125 590,000 Piedmont Municipal Power Agency, SC, Electricity Refunding Revenue Bonds, 6.85% (FGIC INS), 1/1/2007 AAA 615,813 290,000 Piedmont Municipal Power Agency, SC, Escrowed to Maturity, Refunding Revenue Bond, 6.50% (FGIC INS)/(Original Issue Yield: 6.625%), 1/1/2014 AAA 320,409
Principal Credit Amount Rating* Value Long-Term Municipals--continued South Carolina--continued $ 970,000 Piedmont Municipal Power Agency, SC, Refunding Revenue Bonds (Series A), 6.375% (FGIC LOC)/ (Original Issue Yield: 6.45%), 1/1/2006 AAA $ 1,038,404 695,000 Piedmont Municipal Power Agency, SC, Refunding Revenue Bonds, 5.50% (MBIA INS)/(Original Issue Yield: 5.60%), 1/1/2013 AAA 706,322 1,000,000 Piedmont Municipal Power Agency, SC, Refunding Revenue Bonds, 6.50% (FGIC INS)/(Original Issue Yield: 6.88%), 1/1/2011* AAA 1,040,080 1,325,000 Richland-Lexington Airport District, Airport & Marina Revenue Bonds, 6.125% (Columbia Metropolitan Airport)/(AMBAC INS)/(Original Issue Yield: 6.40%), 1/1/2025 AAA 1,323,225 1,000,000 Richland County, SC Hospital Facilities, Refunding Revenue Bond, (Series B), 5.00% (Richland Memoral Hospital)/(MBIA INS)/ (Original Issue Yield: 5.15%), 6/1/2005 AAA 1,032,330 1,000,000 Richland County, SC Hospital Facilities, Refunding Revenue Bond, 4.90% (Richland Memoral Hospital)/ (MBIA INS)/(Original Issue Yield: 5.05%), 6/1/2004 AAA 1,029,120
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia South Carolina Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--continued South Carolina--continued $ 2,435,000 Richland County, SC Hospital Facilities, Revenue Bonds (Series PG-A), 7.10% (Community Provider Pooled Loan Program)/ (CGIC INS), 7/1/2005 AAA $ 2,646,090 3,175,000 Richland County, SC School District No. 001, GO UT, 4.625%, 3/1/2022 AA 2,631,504 650,000 Richland County, SC Solid Waste Disposal Facilities, Revenue Bonds (Series A), 7.45% (Union Camp Corp. Project)/ (Original Issue Yield: 7.513%), 4/1/2021 BBB+ 684,158 1,390,000 Richland County, SC, GO UT Refunding Bonds (Series B), 6.25% (State Aid Withholding LOC), 3/1/2001 AA 1,424,416 1,645,000 Richland County, SC, GO UT, (Series C), 5.80% (Original Issue Yield: 5.85%), 3/1/2007 AA 1,708,958 1,000,000 Richland County, SC, Refunding Revenue Bond, (Series C), 6.10%, 11/1/2004 BBB+ 1,040,990 1,000,000 Richland County, SC, Refunding Revenue Bond, (Series C), 6.20%, 11/1/2005 BBB+ 1,041,330 1,000,000 Richland County, SC, Refunding Revenue Bond, (Series C), 6.30%, 11/1/2006 BBB+ 1,040,120 130,000 Rock Hill, SC Housing Development Corp., Multi-family Refunding Revenue Bonds, 7.50%, 7/1/2010 NR 135,265
Principal Credit Amount Rating* Value Long-Term Municipals--continued South Carolina--continued $ 2,630,000 Rock Hill, SC Utility System, Refunding Revenue Bond, 5.25% (AMBAC INS)/ (Original Issue Yield: 5.40%), 1/1/2008 AAA $ 2,659,666 2,190,000 South Carolina Job Development Authority, (Series A) Refunding Bonds, 5.20% (South Carolina Baptist Hospital)/ (AMBAC LOC)/ (Original Issue Yield: 5.30%), 8/1/2006 AAA 2,217,528 2,000,000 South Carolina Job Development Authority, Revenue Bonds, 5.25% (Anderson Area Medical Center, Inc.)/ (MBIA INS)/(Original Issue Yield: 5.63%), 2/1/2015 AAA 1,888,880 500,000 South Carolina Resources Authority, Local Government Program, Revenue Bonds (Series A), 7.00%, 6/1/2003 A+ 516,565 1,000,000 South Carolina State Educational Assistance Authority, Refunding Revenue Bonds (Series A-3), 5.80% (Original Issue Yield: 5.90%), 9/1/2004 AAA 1,038,950 1,000,000 South Carolina State Educational Assistance Authority, Refunding Revenue Bonds (Series B), 5.70% (Original Issue Yield: 5.75%), 9/1/2005 A 1,030,000
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia South Carolina Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--continued South Carolina--continued $ 3,475,000 South Carolina State Housing Finance & Development Authority, Refunding Revenue Bonds (Series A), 6.15%, 7/1/2008 AA $ 3,548,184 1,200,000 South Carolina State Housing Finance & Development Authority, Revenue Bonds (Series A), 7.30% (FHA/VA mtgs GTD), 7/1/2011 AA 1,250,592 1,000,000 South Carolina State Housing Finance & Development Authority, Revenue Bonds (Series A-1), 6.45% (FHA/VA mtgs GTD), 7/1/2017 NR 1,023,570 500,000 South Carolina State Housing Finance & Development Authority, Revenue Bonds (Series C), 7.70% (FHA/VA mtgs GTD), 7/1/2011 AA 512,480 520,000 South Carolina State Housing Finance & Development Authority, Revenue Bonds (Series C), 7.75% (FHA/VA mtgs GTD), 7/1/2022 AA 533,910 1,000,000 South Carolina State Ports Authority, Revenue Bonds, 6.50% (AMBAC INS)/ (Original Issue Yield: 6.75%), 7/1/2006 AAA 1,052,540 1,000,000 South Carolina State Ports Authority, Revenue Bonds, 6.625% (AMBAC INS)/(Original Issue Yield: 6.823%), 7/1/2011 AAA 1,054,440
Principal Credit Amount Rating* Value Long-Term Municipals--continued South Carolina--continued $ 525,000 South Carolina State Ports Authority, Revenue Bonds, 6.75% (AMBAC INS)/ (Original Issue Yield: 6.90%), 7/1/2021 AAA $ 554,568 2,495,000 South Carolina State Public Service Authority, (Series C) Refunding Revenue Bonds, 5.125% (Original Issue Yield: 5.47%), 1/1/2032 AAA 2,128,135 5,000,000 South Carolina State Public Service Authority, (Series D) Electric Light and Power Improvements, 6.625% (Original Issue Yield: 6.70%), 7/1/2031 AAA 5,362,700 5,000,000 South Carolina State Public Service Authority, Electric, Light, & Power Improvement Refunding Revenue Bonds, 7.10%, 7/1/2021 AAA 5,310,500 2,200,000 South Carolina State Public Service Authority, Refunding Revenue Bond, (Series B), 5.875% (FGIC INS)/(Original Issue Yield: 6.19%), 1/1/2023 AAA 2,161,698 2,500,000 South Carolina State Public Service Authority, Refunding Revenue Bond, (Series C), 5.00% (AMBAC INS)/(Original Issue Yield: 5.25%), 1/1/2014 AAA 2,346,950
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia South Carolina Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------ Long-Term Municipals--continued South Carolina--continued $ 2,585,000 South Carolina State Public Service Authority, Refunding Revenue Bond, 5.125% (MBIA INS)/(Original Issue Yield: 5.40%), 1/1/2021 AAA $ 2,289,741 2,250,000 South Carolina State Public Service Authority, Refunding Revenue Bond, 5.50% (AMBAC INS)/ (Original Issue Yield: 5.834%), 1/1/2023 AAA 2,093,040 2,500,000 South Carolina State Public Service Authority, Refunding Revenue Bonds(Series A), 5.125% (MBIA INS)/(Original Issue Yield: 5.35%), 1/1/2032 AAA 2,132,400 1,000,000 South Carolina State Public Service Authority, Refunding Revenue Bonds, 5.00% (MBIA INS)/(Original Issue Yield: 5.15%), 1/1/2014 AAA 938,780 2,500,000 South Carolina State Public Service Authority, Refunding Revenue Bonds, 5.00% (MBIA LOC)/(Original Issue Yield: 5.20%), 1/1/2025 AAA 2,136,100 1,000,000 South Carolina State Public Service Authority, Revenue Bond, (Series D), 5.80% (Santee Cooper), 7/1/2000 AA- 1,009,970 2,000,000 South Carolina State Public Service Authority, Revenue Bond, 5.00% (MBIA INS)/(Original Issue Yield: 5.20%), 1/1/2015 AAA 1,850,900
Principal Credit Amount Rating* Value Long-Term Municipals--continued South Carolina--continued $ 1,950,000 South Carolina State Public Service Authority, Revenue Bonds (Series D), 6.50% (Santee Cooper)/(AMBAC INS)/(Original Issue Yield: 6.553%), 7/1/2014 AAA $ 2,085,564 2,500,000 South Carolina State Public Service Authority, Revenue Refunding Bonds, 5.00% (FGIC INS)/ (Original Issue Yield: 5.30%), 1/1/2018 AAA 2,242,775 1,040,000 South Carolina State, (Series A) GO UT Highway Improvement Bonds, 4.50%, 4/1/2020 AAA 863,938 2,540,000 South Carolina State, GO UT (Series A) Highway Improvement Bonds, 4.50% (Original Issue Yield: 4.90%), 2/1/2010 AAA 2,401,748 2,625,000 South Carolina State, GO UT (Series A) Highway Improvement Bonds, 4.50% (Original Issue Yield: 4.95%), 2/1/2011 AAA 2,446,343 800,000 South Carolina State, GO UT (Series A) Highway Improvement Bonds, 4.50%, 4/1/2021 AAA 659,528 1,000,000 South Carolina State, GO UT (Series A), 6.20% (Original Issue Yield: 4.75%), 2/1/2000 AAA 1,003,840 1,400,000 South Carolina State, GO UT (Series B) Highway Improvement Bonds, 5.625%, 7/1/2008 AAA 1,470,882
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia South Carolina Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--continued South Carolina--continued $ 1,000,000 South Carolina State, GO UT (Series W), 6.00% (Medical University of South Carolina), 5/1/2000 AAA $ 1,008,780 1,210,000 South Carolina State, GO UT Bonds (Series A), 4.50% (State Highway), 4/1/2023 AAA 986,816 3,900,000 South Carolina State, GO UT Bonds (Series A), 4.60% (Original Issue Yield: 4.93%), 5/1/2019 AAA 3,313,908 4,500,000 South Carolina State, GO UT Revenue Bonds (Series A), 5.00% (Original Issue Yield: 5.45%), 3/1/2008 AAA 4,528,215 1,150,000 South Carolina State, GO UT, 4.50% (State Highway), 4/1/2022 AAA 942,241 1,000,000 South Carolina State, GO UT, 5.75% (Original Issue Yield: 4.70%), 8/1/2003 AAA 1,045,670 325,000 South Carolina State, GO UT, 6.00% (Medical University of South Carolina)/ (Original Issue Yield: 6.05%), 3/1/2002 AAA 333,050 350,000 South Carolina State, GO UT, 6.00% (Medical University of South Carolina)/ (Original Issue Yield: 6.15%), 3/1/2003 AAA 358,670 375,000 South Carolina State, GO UT, 6.00% (Medical University of South Carolina)/ (Original Issue Yield: 6.25%), 3/1/2004 AAA 384,289
Principal Credit Amount Rating* Value Long-Term Municipals--continued South Carolina--continued $ 975,000 South Carolina State, Revenue Bond, 4.00% (Columbia Mill Building)/(MBIA INS)/ (Original Issue Yield: 5.10%), 2/1/2007 AAA $ 904,829 3,200,000 South Carolina State, Revenue Bonds, GO UT, (Series A), 6.35%, 3/1/2001 AAA 3,285,152 1,000,000 South Carolina State, Series A) GO UT, 4.25% (Original Issue Yield: 5.60%), 3/1/2009 AAA 938,910 590,000 South Carolina State, State Capital Improvement (Series B), 5.75%, 8/1/2000 AAA 597,263 10,900,000 South Carolina Transportation Infrastructure Bank, Revenue Bonds (Series A), 4.50% (MBIA INS), 10/1/2016 AAA 9,248,214 1,640,000 South Carolina Transportation Infrastructure Bank, Revenue Bonds (Series A), 5.00% (MBIA LOC), 10/1/2007 AAA 1,647,806 6,000,000 South Carolina Transportation Infrastructure Bank, Revenue Bonds, 4.50% (MBIA INS), 10/1/2014 AAA 5,222,400 1,000,000 Spartanburg County, SC Health Services District, Inc., Refunding Revenue Bond, (Series B), 5.125% (MBIA INS)/ (Original Issue Yield: 5.55%), 4/15/2022 AAA 876,790
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia South Carolina Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--continued South Carolina--continued $ 2,595,000 Spartanburg County, SC Health Services District, Inc., Refunding Revenue Bond, 5.00% (AMBAC INS)/(Original Issue Yield: 5.60%), 4/15/2011 AAA $ 2,530,047 3,000,000 Spartanburg County, SC Health Services District, Inc., Refunding Revenue Bonds, 5.50% (AMBAC INS)/(Original Issue Yield: 5.70%), 4/15/2015 AAA 2,943,390 1,125,000 Spartanburg County, SC Hospital Facilities, Revenue Bond, (Series B), 6.20% (Spartanburg General Hospital System)/(FSA INS), 4/15/2002 AAA 1,167,683 955,000 Spartanburg County, SC Hospital Facilities, Revenue Bond, (Series B), 6.30% (Spartanburg General Hospital System)/(FSA INS), 4/15/2003 AAA 1,012,768 3,000,000 Spartanburg County, SC Hospital Facilities, Revenue Refunding Bonds, 6.55% (Spartanburg General Hospital System)/(FSA INS), 4/15/2010 AAA 3,167,130 450,000 Spartanburg, SC Leased Housing Corp., Refunding Revenue Bonds, 7.50%, 10/1/2011 NR 471,510 1,000,000 Spartanburg, SC Waterworks, Refunding Revenue Bonds, 5.00% (FGIC INS), 6/1/2027 AAA 861,690
Principal Credit Amount Rating* Value Long-Term Municipals--continued South Carolina--continued $ 1,755,000 Sumter County, SC Hospital Facilities, Refunding Revenue Bond, 6.45% (Tuomey Regional Medical Center)/(MBIA INS)/ (Original Issue Yield: 6.55%), 11/15/2000 AAA $ 1,793,084 2,000,000 Sumter County, SC Hospital Facilities, Refunding Revenue Bond, 6.50% (Tuomey Regional Medical Center)/(MBIA INS)/ (Original Issue Yield: 6.80%), 11/15/2002 AAA 2,109,300 1,000,000 Sumter County, SC Hospital Facilities, Refunding Revenue Bonds, 6.625% (Tuomey Regional Medical Center)/(MBIA INS)/(Original Issue Yield: 6.98%), 11/15/2004 AAA 1,081,710 2,295,000 University South Carolina, Parking Facilities Refunding Revenue Bonds, 5.00% (MBIA INS)/(Original Issue Yield: 5.40%), 5/1/2015 AAA 2,132,652 1,015,000 University of South Carolina, Revenue Bond, 5.60% (AMBAC INS)/(Original Issue Yield: 5.70%), 6/1/2017 996,689 3,465,000 University of South Carolina, Revenue Bonds, 5.70% (MBIA INS), 6/1/2020 AAA 3,385,201
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia South Carolina Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--continued South Carolina--continued $ 2,000,000 Western Carolina Regional Sewer Authority, SC, Partially Prerefunded Revenue Bond, 7.00% (AMBAC INS)/(Original Issue Yield: 7.125%), 3/1/2002 AAA $ 2,053,980 1,000,000 Western Carolina Regional Sewer Authority, SC, Refunding Revenue Bond, 5.10% (FGIC INS)/(Original Issue Yield: 5.20%), 3/1/2004 AAA 1,018,080 2,090,000 Western Carolina Regional Sewer Authority, SC, Refunding Revenue Bond, 5.40% (FGIC INS)/(Original Issue Yield: 5.465%), 3/1/2007 AAA 2,135,290 4,800,000 Western Carolina Regional Sewer Authority, SC, Sewer System Revenue Bonds, 5.50% (FGIC INS)/ (Original Issue Yield: 5.627%), 3/1/2010 AAA 4,867,248 1,830,000 York County, SC PCR, Refunding Revenue Bond, (Series A), 7.40%, 1/1/2010 BBB 1,890,536 1,000,000 York County, SC, GO UT Refunding Bonds, 4.90% (AMBAC INS)/ (Original Issue Yield: 5.10%), 6/1/2010 AAA 973,670 3,050,000 York County, SC, GO UT, 4.70% (AMBAC INS)/(Original Issue Yield: 4.85%), 6/1/2006 AAA 3,024,899 ------------ Total 341,811,331 ------------
Principal Amount Credit or Shares Rating* Value Long-Term Municipals--continued Puerto Rico--0.3% $ 35,000 Puerto Rico Commonwealth Infrastructure Financing Authority, Revenue Bonds (Series A), 5.00% (AMBAC LOC)/(Original Issue Yield: 5.28%), 7/1/2028 AAA $ 30,751 1,115,000 Puerto Rico Electric Power Authority, Revenue Bonds (Series DD), 5.00% (MBIA INS)/(Original Issue Yield: 5.28%), 7/1/2028 AAA 979,628 150,000 Puerto Rico Highway and Transportation Authority, Refunding Revenue Bonds (Series A), 5.00% (AMBAC LOC)/(Original Issue Yield: 5.16%), 7/1/2028 AAA 131,789 ------------ Total 1,142,168 ------------ Total Long-Term Municipals (identified cost $345,009,437) 342,953,499 ------------ Open-End Investment Companies--0.4% 255,903 AIM Global Management Money Market Fund 255,903 140,598 Dreyfus Tax Exempt Money Market Fund 140,598 817,013 Fidelity Tax Exempt Money Market Fund 817,013 ------------ Total Open-End Investment Companies (at cost) 1,213,514 ------------ Total Investments (identified cost $346,222,951) $344,167,013 ------------
(See Notes to Portfolios of Investments) - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Virginia Municipal Bond Fund (Class A Shares) Growth of $10,000 Invested in Wachovia Virginia Municipal Bond Fund (Class A Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Virginia Municipal Bond Fund (Class A Shares) (the "Fund") from February 1, 1993 (start of performance) to November 30, 1999 compared to the Lehman Brothers Municipal Bond Index (LBMBI),+ and the Lehman Brothers Municipal Bond 7-Year Index (LBMB7YI).+ [Please see Appendix A34] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * Represents a hypothetical investment of $10,000 in the Fund after deducting the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge = $9,550). The Fund's performance assumes the reinvestment of all dividends and distributions. The LBMBI and LBMB7YI have been adjusted to reflect the reinvestment of dividends on securities in the indices. ** Total returns quoted reflect all applicable sales charges and contingent deferred sales charges. + The LBMBI is an unmanaged index generally representative of the performance of the municipal bond market as a whole. The LBMB7YI is an unmanaged index representative of municipal bonds with remaining maturities of seven years. The indices do not reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Wachovia Virginia Municipal Bond Fund (Class Y Shares) Growth of $10,000 Invested in Wachovia Virginia Municipal Bond Fund (Class Y Shares) The graph below illustrates the hypothetical investment of $10,000* in the Wachovia Virginia Municipal Bond Fund (Class Y Shares) (the "Fund") from March 29, 1998 (start of performance) to November 30, 1999 compared to the Lehman Brothers Municipal Bond Index (LBMBI)+ and Lehman Brothers Municipal Bond 7- Year Index (LBMB7YI).+ [Please see Appendix A35] Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. * The Fund's performance assumes the reinvestment of all dividends and distributions. The LBMBI and LBMB7YI have been adjusted to reflect the reinvestment of dividends on securities in the indices. + The LBMBI is an unmanaged index generally representative of the performance of the municipal bond market as a whole. The LBMB7YI is an unmanaged index representative of municipal bonds with remaining maturities of seven years. The indices do not reflect sales charges, expenses, or other fees that the SEC requires to be reflected in the Fund's performance. Investments cannot be made in an index. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Virginia Municipal Bond Fund Portfolio of Investments November 30, 1999
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--95.4% Virginia--94.3% $ 500,000 Albemarle County, VA, Refunding Revenue Bonds, 5.50% (Original Issue Yield: 5.634%), 8/1/2006 A+ $ 512,665 250,000 Alexandria, VA, GO UT, 5.65% (Original Issue Yield: 5.70%), 12/1/2001 AAA 257,073 850,000 Arlington County, VA, GO UT Refunding Bonds, 6.00%, 6/1/2004 AAA 901,272 500,000 Arlington County, VA, GO UT, 5.00%, 7/15/2000 AAA 503,475 1,000,000 Arlington County, VA, GO UT, 5.40% (Original Issue Yield: 5.55%), 6/1/2015 AAA 988,120 1,255,000 Arlington County, VA, Refunding Bonds, 4.70% (Original Issue Yield: 4.75%), 6/1/2006 AAA 1,253,820 2,080,000 Arlington, VA IDA, Revenue Bonds, 5.45% (The Nature Conservancy)/(Original Issue Yield: 5.57%), 7/1/2027 Aa1 1,937,915 1,100,000 Arlington, VA IDA, Refunding Revenue Bonds, 5.30% (Arlington Hospital)/(United States Treasury PRF)/(Original Issue Yield: 5.47%), 9/1/2003 A1 1,020,327 200,000 Augusta County, VA IDA, Refunding Revenue Bond, 6.30% (AMBAC INS)/(Original Issue Yield: 6.40%), 9/1/2002 AAA 210,572 2,000,000 Augusta County, VA IDA, Revenue Bonds, 6.625% (Augusta Hospital Corp.)/(AMBAC INS)/(Original Issue Yield: 6.817%), 9/1/2012 AAA 2,116,580
Principal Credit Amount Rating* Value Long-Term Municipals--continued Virginia--continued $1,000,000 Chesapeake Bay Bridge & Tunnel District, VA, Refunding Revenue Bonds, 5.50% (MBIA LOC)/(Original Issue Yield: 4.86%), 7/1/2025 AAA $ 956,990 1,750,000 Chesapeake, VA, GO UT, 5.40% (Original Issue Yield: 5.50%), 5/1/2008 AA 1,803,008 1,485,000 Chesterfield County, VA, 4.50% (Original Issue Yield: 4.75%), 1/1/2019 AAA 1,246,464 1,000,000 Chesterfield County, VA, GO UT, 5.60% (Original Issue Yield: 5.65%), 7/15/2006 AAA 1,043,660 250,000 Culpeper, VA IDA, Refunding Revenue Bond, 6.40% (FHA INS), 1/15/2003 AA- 254,078 600,000 Danville, VA, GO UT, 6.40% (Original Issue Yield: 6.45%), 5/1/2009 A3 638,100 500,000 Danville, VA, GO UT, 6.40% (Original Issue Yield: 6.50%), 5/1/2010 A3 531,750 1,000,000 Fairfax County, VA IDA, Refunding Revenue Bonds, 5.00% (Inova Health System)/(AMBAC INS)/(Original Issue Yield: 5.30%), 8/15/2013 AAA 957,320 400,000 Fairfax County, VA IDA, Refunding Revenue Bonds, 5.00% (Inova Health System)/(Original Issue Yield: 5.10%), 8/15/2008 AA 393,188 1,250,000 Fairfax County, VA IDA, Refunding Revenue Bonds, 5.25% (Inova Health System)/(FSA INS)/(Original Issue Yield: 5.35%), 8/15/2019 AAA 1,166,287
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Virginia Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--continued Virginia--continued $1,000,000 Fairfax County, VA IDA, Refunding Revenue Bonds, 5.25% (Inova Health System)/(Original Issue Yield: 5.35%), 8/15/2019 AA $ 924,210 2,735,000 Fairfax County, VA Water Authority, Refunding Revenue Bonds, 6.00% (Original Issue Yield: 6.281%), 4/1/2022 AAA 2,968,159 1,265,000 Fairfax County, VA Water Authority, Refunding Revenue Bonds, 6.00% (Original Issue Yield: 6.281%), 4/1/2022 AA 1,276,840 500,000 Fairfax County, VA Water Authority, Revenue Bonds, 5.00% (Original Issue Yield: 5.375%), 4/1/2016 AA 461,325 3,800,000 Fairfax County, VA Water Authority, Refunding Revenue Bonds, 5.00% (Original Issue Yield: 5.22%), 4/1/2021 AA 3,402,520 1,000,000 Fairfax County, VA Water Authority, Refunding Revenue Bonds, 5.00% (Original Issue Yield: 5.30%), 4/1/2029 AA 863,290 570,000 Fairfax County, VA, (Series B) GO UT, 6.00% (Original Issue Yield: 6.10%), 5/1/2007 AAA 582,323 2,000,000 Fairfax County, VA, GO UT Refunding Bonds (Series A), 4.50% (Original Issue Yield: 4.68%), 6/1/2013 AAA 1,803,180
Principal Credit Amount Rating* Value Long-Term Municipals--continued Virginia--continued $ 500,000 Fairfax County, VA, GO UT, (Series A), 5.00% (Original Issue Yield: 5.07%), 6/1/2018 AAA $ 457,365 850,000 Fairfax County, VA, GO UT, 4.50% (Original Issue Yield: 4.426%), 6/1/2010 801,984 5,000,000 Fairfax County, VA, GO UT, 4.50% (Original Issue Yield: 4.73%), 6/1/2014 AAA 4,438,200 500,000 Hampton, VA Sanitation District, Refunding Revenue Bond, 4.30% (Original Issue Yield: 4.40%), 10/1/2000 AA 501,565 1,000,000 Hampton, VA, GO UT, 5.90% (Original Issue Yield: 6.00%), 1/15/2007 AA 1,068,610 500,000 Hanover County, VA IDA, Revenue Bond, 4.50% (Original Issue Yield: 4.60%), 8/15/2000 AAA 501,475 500,000 Hanover County, VA IDA, Revenue Bond, 5.375% (Original Issue Yield: 5.55%), 5/1/2004 Aa 509,610 250,000 Hanover County, VA IDA, Revenue Bond, 6.00% (MBIA INS)/(Original Issue Yield: 6.10%), 10/1/2001 AAA 257,520 1,000,000 Hanover County, VA IDA, Revenue Bonds, 6.375% (Memorial Regional Medical Center)/(MBIA INS), 8/15/2018 AAA 1,059,000
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Virginia Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--continued Virginia--continued $ 250,000 Harrisonburg, VA Redevelopment & Housing Authority, Refunding Revenue Bond, 6.60% (Original Issue Yield: 6.70%), 9/1/2002 A2 $ 264,337 2,000,000 Henrico County, VA, GO UT Refunding Bonds, 5.30% (Original Issue Yield: 5.45%), 1/15/2010 AAA 2,023,560 1,000,000 Henrico County, VA, Refunding Revenue Bonds, 6.25% (Original Issue Yield: 6.65%), 5/1/2013 AA- 1,026,840 250,000 Henry County, VA Public Service Authority, Refunding Revenue Bond, 6.00% (FGIC INS)/(Original Issue Yield: 6.05%), 11/15/2003 AAA 259,525 1,000,000 James City County, VA, GO UT, 5.20% (State Aid Withholding GTD)/(FGIC INS)/(Original Issue Yield: 5.35%), 12/15/2010 AAA 1,008,150 250,000 Loudoun County, VA Sanitation Authority, Refunding Revenue Bond, 6.00% (FGIC INS)/(Original Issue Yield: 6.05%), 1/1/2003 AAA 260,937 1,000,000 Loudoun County, VA Sanitation Authority, Revenue Bonds, 4.75% (MBIA INS), 1/1/2021 AAA 849,920 1,000,000 Loudoun County, VA Sanitation Authority, Revenue Bonds, 4.75% (MBIA INS)/(Original Issue Yield: 5.04%), 1/1/2030 AAA 817,880
Principal Credit Amount Rating* Value Long-Term Municipals--continued Virginia--continued $ 250,000 Loudoun County, VA, Refunding Revenue Bond, 6.875%, 3/1/2001 AA $ 256,782 1,000,000 Manassa, VA, GO UT, 5.00% (Original Issue Yield: 5.05%), 1/1/2012 AA- 972,130 50,000 Metropolitan Washington, DC Airports Authority, Refunding Revenue Bond, 4.90% (MBIA INS)/(Original Issue Yield: 5.00%), 10/1/2005 AAA 50,489 1,000,000 Newport News, VA, GO UT (Series A), 5.20% (Original Issue Yield: 5.35%), 1/15/2018 AA 931,060 1,000,000 Newport News, VA, GO UT (Series A), 6.00% (Original Issue Yield: 6.05%), 6/1/2006 AA 1,046,620 1,000,000 Newport News, VA, GO UT (Series A), 6.00% (Original Issue Yield: 6.10%), 6/1/2007 AA 1,048,860 500,000 Newport News, VA, GO UT Bonds (Series A), 5.80% (Original Issue Yield: 5.85%), 6/1/2004 AA 518,720 500,000 Norfolk, VA IDA, Refunding Bonds (Series A), 4.20% (Sentara Hospitals), 11/1/2000 AA 500,515 900,000 Norfolk, VA IDA, Refunding Revenue Bonds, 5.50% (Sentara Hospitals), 11/1/2017 AA 859,977 1,000,000 Norfolk, VA IDA, Refunding Revenue Bonds, 6.50% (Daughter's Charity-DePaul Hospital), 12/1/2007 AA+ 1,076,050
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Virginia Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------ Long-Term Municipals--continued Virginia--continued $2,500,000 Norfolk, VA IDA, Refunding Revenue Bonds, 6.50% (Sentara Hospitals), 11/1/2013 AA $ 2,688,925 100,000 Norfolk, VA IDA, Revenue Bonds (Series A), 6.75% (Children's Hospital King's Group), 6/1/2001 103,257 250,000 Norfolk, VA IDA, Revenue Bonds, 6.80% (Sentara Hospitals)/(Original Issue Yield: 6.85%), 11/1/2002 AA 266,055 500,000 Norfolk, VA Water System, Revenue Bonds, 5.90% (MBIA INS)/(Original Issue Yield: 6.194%), 11/1/2025 AAA 497,275 1,000,000 Norfolk, VA, GO UT (Series A), 5.90% (Original Issue Yield: 6.00%), 2/1/2006 AA 1,038,670 1,000,000 Norfolk, VA, GO UT Refunding Bonds (Series A), 6.00% (Original Issue Yield: 6.20%), 2/1/2008 AA 1,039,790 125,000 Norfolk, VA, GO UT Refunding Bonds, 5.00% (FGIC INS), 7/1/2009 AAA 124,759 500,000 Norfolk, VA, GO UT Refunding Bonds, 5.00% (FGIC INS)/(Original Issue Yield: 5.05%), 7/1/2015 AAA 465,855 1,000,000 Norfolk, VA, GO UT Refunding Bonds, 5.25% (Original Issue Yield: 5.35%), 2/1/2006 AA 1,019,170 3,000,000 Norfolk, VA, GO UT Refunding Bonds, 5.25% (Virginia State GTD)/(Original Issue Yield: 5.35%), 6/1/2008 AA 3,036,420
Principal Credit Amount Rating* Value Long-Term Municipals--continued Virginia--continued $2,000,000 Norfolk, VA, GO UT Refunding Bonds, 5.50% (Original Issue Yield: 5.55%), 2/1/2008 AA $ 2,045,360 500,000 Peumansend Creek Regional Jail Authority, VA, Revenue Bonds, 5.00% (MBIA INS)/(Original Issue Yield: 5.05%), 6/1/2006 AAA 504,835 250,000 Portsmouth, VA, GO UT Refunding Bonds, 6.25%, 11/1/2002 AA- 262,447 500,000 Prince William County, VA, Certificate Participation Refunding Bonds, 5.20% (MBIA INS)/(Original Issue Yield: 5.35%), 12/1/2005 AAA 509,410 500,000 Prince William County, VA, GO UT Bonds (Series C), 5.00% (Original Issue Yield: 5.10%), 8/1/2006 AA 505,995 1,000,000 Prince William County, VA, GO UT Refunding Bonds, 5.90% (Original Issue Yield: 6.00%), 12/1/2003 AA 1,038,390 1,980,000 Richmond, VA Metropolitan Authority, Refunding Revenue Bonds, 5.25% (FGIC LOC), 7/15/2022 AAA 1,826,055 1,000,000 Richmond, VA Public Utility, Refunding Revenue Bonds, 5.125% (FGIC LOC)/(Original Issue Yield: 5.31%), 1/15/2028 AAA 879,420 1,500,000 Richmond, VA, GO UT Bonds, 5.50% (State Aid Withholding INS)/(Original Issue Yield: 5.72%), 7/15/2023 AA 1,419,375
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Virginia Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--continued Virginia--continued $1,000,000 Richmond, VA, GO UT Refunding Bonds (Series B), 5.00% (FGIC INS)/(Original Issue Yield: 5.259%), 1/15/2021 AAA $ 885,990 1,000,000 Rivanna Water & Sewer Authority, Refunding Revenue Bonds, 4.80% (Original Issue Yield: 5.10%), 10/1/2015 A+ 897,900 500,000 Roanoke County, VA Water System, Refunding Revenue Bonds, 5.00% (FGIC INS), 7/1/2021 AAA 442,380 250,000 Roanoke, VA IDA, Refunding Bonds (Series B), 5.80% (Roanoke Memorial Hospital)/(Original Issue Yield: 5.90%), 7/1/2005 AA- 257,012 250,000 Roanoke, VA, GO UT Bonds (Series B), 6.00%, 8/1/2003 AA 258,147 2,225,000 Roanoke, VA, GO UT Bonds, 5.25% (Original Issue Yield: 5.30%), 8/1/2024 AA 2,007,417 1,000,000 Roanoke, VA, GO UT Bonds, 6.20%, 8/1/2005 AA 1,040,440 1,250,000 Roanoke, VA, GO UT Bonds, 6.30% (Original Issue Yield: 6.35%), 8/1/2007 AA 1,308,375 500,000 Southeastern Public Service Authority, VA, Refunding Bonds (Series A), 4.90% (MBIA INS)/(Original Issue Yield: 4.95%), 7/1/2006 AAA 500,675 500,000 Spotsylvania County, VA, GO UT Bonds, 5.40% (Original Issue Yield: 5.45%), 7/15/2004 A+ 515,940
Principal Credit Amount Rating* Value Long-Term Municipals--continued Virginia--continued $1,000,000 Spotsylvania County, VA, GO UT Bonds, 5.50% (Original Issue Yield: 5.55%), 7/15/2005 A+ $ 1,044,140 1,000,000 Spotsylvania County, VA, GO UT Bonds, 5.70% (Original Issue Yield: 5.75%), 7/15/2007 A+ 1,049,040 1,500,000 University of Virginia, Refunding Revenue Bonds (Series A), 5.20% (Original Issue Yield: 5.45%), 6/1/2015 AA+ 1,433,880 6,010,000 Upper Occoquan Sewage Authority, VA, (Series A), 4.75% (MBIA LOC)/(Original Issue Yield: 5.30%), 7/1/2029 AAA 4,922,010 250,000 Upper Occoquan Sewage Authority, VA, Refunding Bonds, 5.45% (AMBAC INS)/(Original Issue Yield: 5.55%), 7/1/2003 AAA 257,900 250,000 Virginia Beach, VA IDA, Hospital Facilities Revenue Bonds, 6.30% (Sentara Bayside Hospital)/(Sentara Bayside Hospital LOC)/(Original Issue Yield: 6.35%), 11/1/2004 AA 263,833 500,000 Virginia Beach, VA IDA, Refunding Bonds, 5.00% (AMBAC INS)/(Original Issue Yield: 5.15%), 2/15/2007 AAA 501,010 250,000 Virginia Beach, VA, Certificate of Participation, 6.90% (FGIC INS)/(Original Issue Yield: 6.95%), 9/1/2000 AAA 255,465 1,250,000 Virginia Beach, VA, GO UT Bonds (Series C), 6.10% (Original Issue Yield: 6.15%), 8/1/2002 AA 1,304,125
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Virginia Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--continued Virginia--continued $1,000,000 Virginia Beach, VA, GO UT Bonds, 5.70%, 7/15/2006 AA $ 1,049,810 250,000 Virginia Beach, VA, GO UT Bonds, 5.80%, 2/1/2003 AA 259,820 1,000,000 Virginia Beach, VA, GO UT Bonds, 5.80%, 7/15/2007 AA 1,052,260 1,000,000 Virginia Beach, VA, GO UT Refunding Bonds, 6.20% (State Aid Withholding INS)/(Original Issue Yield: 6.25%), 9/1/2014 AA 1,082,520 860,000 Virginia College Building Authority, (Series A), 5.00% (Original Issue Yield: 5.275%), 9/1/2016 AA 790,710 1,000,000 Virginia College Building Authority, Refunding Revenue Bonds, 5.80% (Washington & Lee University Project), 1/1/2024 AAA 1,059,840 815,000 Virginia College Building Authority, Revenue Bonds (Series A), 4.625%, 9/1/2014 AA 725,317 500,000 Virginia College Building Authority, Revenue Bonds, 5.00%, 8/1/2008 AA 500,835 500,000 Virginia Commonwealth Transportation Board, Revenue Bonds (Series A), 5.00%, 5/15/2004 AA 508,270 1,500,000 Virginia Polytechnical Institute & State University, Refunding Revenue Bonds (Series C), 5.50% (Original Issue Yield: 5.70%), 6/1/2016 AA 1,468,965
Principal Credit Amount Rating* Value Long-Term Municipals--continued Virginia--continued $ 500,000 Virginia State Housing Development Authority, Refunding Revenue Bonds, 6.10%, 1/1/2007 AA+ $ 506,560 500,000 Virginia State Housing Development Authority, Refunding Revenue Bonds, 6.20%, 1/1/2008 AA+ 513,090 500,000 Virginia State Housing Development Authority, Refunding Revenue Bonds, 6.30%, 1/1/2009 AA+ 515,205 400,000 Virginia State Housing Development Authority, Refunding Revenue Bonds, 6.45%, 5/1/2001 AA+ 405,472 985,000 Virginia State Housing Development Authority, Revenue Bonds (Series A), 6.40%, 7/1/2017 AA+ 1,004,139 1,000,000 Virginia State Housing Development Authority, Revenue Bonds (Series B), 6.35%, 1/1/2015 AA+ 1,026,610 1,000,000 Virginia State Housing Development Authority, Revenue Bonds (Series B), 6.55%, 1/1/2011 AA+ 1,028,580 500,000 Virginia State Housing Development Authority, Revenue Bonds (Series C), 5.45%, 7/1/2002 AA+ 505,165 710,000 Virginia State Housing Development Authority, Revenue Bonds (Series F), 6.40%, 7/1/2017 AA+ 722,553 2,000,000 Virginia State Public Building Authority, (Series A) Refunding Bonds, 5.40%, 8/1/2012 AA 2,006,320 515,000 Virginia State Public Building Authority, (Series B), 5.50% (Original Issue Yield: 5.63%), 8/1/2014 AA 514,186
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Virginia Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------ Long-Term Municipals--continued Virginia--continued $ 300,000 Virginia State Public Building Authority, Refunding Bonds (Series A), 5.00%, 8/1/2004 AA $ 304,656 3,000,000 Virginia State Public Building Authority, Refunding Revenue Bonds, 5.00% (Original Issue Yield: 4.64%), 8/1/2009 AA 2,982,750 500,000 Virginia State Public Building Authority, Revenue Bonds (Series C), 5.20% (Original Issue Yield: 5.30%), 8/1/2003 AA 511,600 2,500,000 Virginia State Public School Authority, (Series A) Revenue Bonds, 6.00% (State Aid Withholding LOC), 8/1/2006 AA 2,665,625 2,550,000 Virginia State Public School Authority, (Series B), 5.25% (Original Issue Yield: 5.58%), 1/1/2010 AA 2,567,697 2,000,000 Virginia State Public School Authority, Refunding Revenue Bonds, 5.00% (Original Issue Yield: 5.10%), 8/1/2012 AA+ 1,942,300 250,000 Virginia State Public School Authority, Revenue Bonds (Series A), 6.30% (Original Issue Yield: 6.40%), 8/1/2001 AA 258,178 1,000,000 Virginia State Public School Authority, Refunding Revenue Bonds, 6.25% (Original Issue Yield: 6.30%), 1/1/2004 AA 1,051,220
Principal Credit Amount Rating* Value Long-Term Municipals--continued Virginia--continued $ 300,000 Virginia State Public School Authority, School Financing Revenue Bonds (Series B), 5.75% (State Aid Withholding COL), 1/1/2008 AA $ 309,708 250,000 Virginia State Resource Authority Solid Waste Disposal Systems, Revenue Bonds (Series B), 5.20%, 5/1/2003 AA 255,440 225,000 Virginia State Resources Authority Water and Sewer System, Refunding Bonds, 5.65% (Original Issue Yield: 5.75%), 10/1/2004 AA 234,875 1,000,000 Virginia State Resources Authority Water and Sewer System, Refunding Revenue Bonds, 5.25% (Appomattox River Water Authority)/ (Original Issue Yield: 5.70%), 10/1/2013 AA 980,190 1,000,000 Virginia State Resources Authority Water and Sewer System, Revenue Bonds (Series A), 5.60% (Original Issue Yield: 5.75%), 10/1/2025 AA 1,046,020 690,000 Virginia State Resources Authority Water and Sewer System, Revenue Bonds, 5.50% (Original Issue Yield: 5.80%), 10/1/2022 AA 654,320 500,000 Virginia State Transportation Board, Revenue Bonds, 5.80%, 5/15/2001 AA 510,800
(See Notes to Portfolios of Investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Wachovia Virginia Municipal Bond Fund
Principal Credit Amount Rating* Value - ------------------------------------------------------------------------------- Long-Term Municipals--continued Virginia--continued $ 250,000 Virginia State, GO UT Bonds (Series A), 5.90% (Original Issue Yield: 5.95%), 6/1/2000 AAA $ 252,523 250,000 Virginia State, GO UT Bonds (Series C), 5.80%, 6/1/2004 AAA 257,445 1,000,000 Virginia State, GO UT Bonds, 5.50% (Original Issue Yield: 5.55%), 6/1/2006 AAA 1,038,150 1,000,000 Virginia State, GO UT Bonds, 6.00%, 6/1/2006 AAA 1,038,370 750,000 Washington County, VA IDA, Refunding Revenue Bonds, 6.00% (Original Issue Yield: 6.16%), 7/1/2014 A2 802,635 ------------ Total 129,670,063 ------------ Puerto Rico--1.1% 1,595,000 Puerto Rico Commonwealth Infrastructure Financing Authority, Revenue Bonds (Series A), 5.00% (AMBAC LOC)/(Original Issue Yield: 5.28%), 7/1/2028 AAA 1,401,352 40,000 Puerto Rico Electric Power Authority, Revenue Bonds (Series DD), 5.00% (MBIA INS)/(Original Issue Yield: 5.28%), 7/1/2028 AAA 35,144
Principal Amount Credit or Shares Rating* Value Long-Term Municipals--continued Puerto Rico--continued $ 45,000 Puerto Rico Highway and Transportation Authority, Refunding Revenue Bonds (Series A), 5.00% (AMBAC LOC)/(Original Issue Yield: 5.16%), 7/1/2028 AAA $ 39,537 ------------ Total 1,476,033 ------------ Total Long-Term Municipals (identified cost $131,915,377) 131,146,096 ------------ Open-End Investment Companies--3.8% 2,065,841 AIM Global Management Short Term Investments 2,065,841 364 Dreyfus Tax Exempt Money Market 364 3,145,179 Fidelity Tax Exempt Money Market 3,145,179 ------------ Total Open-End Investment Companies (at cost) 5,211,384 ------------ Total Investments (identified cost $137,126,761) $136,357,480 ------------
(See Notes to Portfolios of Investments) - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Notes to Portfolios of Investments * Please refer to the Appendix of the Statement of Additional Information for an explanation of the credit ratings. Current credit ratings are unaudited. (1) Non-income producing. (2) Represents securities held as collateral within a margin account, used to ensure the fund is able to satisfy the obligations of its outstanding long futures contracts. (3) The repurchase agreements are fully collateralized by U.S. Government and/or agency obligations based on market prices at the date of the portfolio. (4) Current rate and next demand date shown. (5) Denotes a restricted security which is subject to restrictions on resale under federal securities laws. These securities have been deemed liquid based upon criteria approved by the fund's Board of Directors. At November 30, 1999, Emerging Markets Fund held restricted securities amounting to $6,698,819, which represents 3.4% of net assets. The following abbreviations are used in these portfolios: ADR--American Depositary Receipt IFA--Industrial Finance Authority AMBAC--American Municipal Bond INS--Insured Assurance Corporation IRB--Industrial Revenue Bond BAN--Bank Anticipation Note LOC--Letter of Credit CGIC--Capital Guaranty Insurance MBIA--Municipal Bond Investors Corporation Assurance COL--Collateralized MTN--Medium Term Note FGIC--Financial Guaranty Insurance PCFA--Pollution Control Finance Corporation Authority FHA--Federal Housing Administration PCR--Pollution Control Revenue FNMA--Federal National Mortgage PRF--Prerefunded Association SFM--Single Family Mortgage FSA--Financial Security Assurance UT--Unlimited Tax GDR--Global Depositary Receipt VA--Veterans Administration GO--General Obligation VRDN-Variable Rate Demand Note GTD--Guaranteed HFA--Housing Finance Authority IDA--Industrial Development Authority
Net Unrealized Gross Gross Cost of Appreciation/ Unrealized Unrealized Investments (Depreciation) Appreciation Depreciation for Federal for Federal for Federal for Federal Total Net Fund Tax Purposes Tax Purposes Tax Purposes Tax Purposes Assets** - ------------------------------------------------------------------------------------------- Equity Fund 258,746,673 93,447,232 101,666,353 8,219,121 351,836,262 Quantitative Equity Fund 361,717,904 350,479,813 354,674,568 4,194,755 712,212,696 Growth and Income Fund 193,510,223 156,181,380 156,923,599 742,219 349,593,378 Equity Index Fund 281,729,436 263,978,579 273,810,716 9,832,137 544,631,351 Special Value Fund 169,706,043 5,889,981 21,257,438 15,367,457 175,667,583 Emerging Markets Fund 160,489,346 33,590,790 51,781,705 18,190,915 194,449,828 Personal Equity Fund 262,487,978 183,741,142 187,810,827 4,069,685 444,562,356 Balanced Fund 531,063,252 117,365,604 136,570,399 19,204,795 650,598,794 Fixed Income Fund 570,897,953 (18,418,815) 2,153,392 20,572,207 558,275,832 Intermediate Fixed In- come Fund 142,796,517 (2,956,883) 773,980 3,730,863 141,712,691 Short-Term Fixed Income Fund 48,639,998 (526,241) 203,673 729,914 48,732,245 Georgia Municipal Bond Fund 113,851,863 (1,425,854) 1,509,477 2,935,331 114,205,551 North Carolina Municipal Bond Fund 441,637,516 (3,638,031) 6,538,634 10,176,665 443,167,488 South Carolina Municipal Bond Fund 346,222,951 (2,048,965) 6,255,568 8,304,533 348,455,611 Virginia Municipal Bond Fund 137,126,761 (769,281) 2,425,864 3,195,145 137,493,589
** The categories of investments are shown as a percentage of net assets at November 30, 1999. At November 30, 1999, the following Funds had investments that were subject to alternative minimum tax:
Percentage of total market value Fund subject to alternative minimum tax - ------------------------------------------------------------ Georgia Municipal Bond Fund 0.5% North Carolina Municipal Bond Fund 0.3% South Carolina Municipal Bond Fund 2.3%
(See Notes which are an integral part of the Financial Statements) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The Wachovia Funds and The Wachovia Municipal Funds Statements of Assets and Liabilities November 30, 1999
Wachovia Wachovia Wachovia Wachovia Wachovia Quantitative Growth & Equity Index Special Equity Fund Equity Fund Income Fund Fund Values Fund - ----------------------------------------------------------------------------------------------------- Assets: Investments in securities, at value $318,020,832 $698,100,782 $339,399,506 $507,806,995 $141,369,072 Investments in repurchase agreements 34,173,073 14,096,935 10,292,097 37,901,020 34,226,952 Income receivable 351,759 690,994 315,716 622,389 215,112 Receivable for investments sold 2,224,723 -- -- 250,728 752,916 Receivable for shares sold 538,693 1,473,383 247,375 415,485 595,901 ------------ ------------ ------------ ------------ ------------ Total assets 355,309,080 714,362,094 350,254,694 546,996,617 177,159,953 ------------ ------------ ------------ ------------ ------------ Liabilities: Payable for investments purchased 2,348,838 -- -- 726,691 972,364 Payable for shares redeemed 101,334 1,285,315 80,217 490,760 292,774 Payable to adviser 179,328 393,733 213,790 134,049 114,001 Payable for daily variation margin 727,650 195,107 289,515 835,841 21,250 Accrued expenses 115,668 275,243 77,794 177,925 91,981 ------------ ------------ ------------ ------------ ------------ Total liabilities 3,472,818 2,149,398 661,316 2,365,266 1,492,370 ------------ ------------ ------------ ------------ ------------ Net Assets Consist of: Paid in capital 248,138,610 361,639,339 133,971,417 268,552,475 161,177,709 Net unrealized appreciation of investments, futures contracts, and translation of assets and liabilities in foreign currency 95,227,495 351,352,262 156,642,309 264,852,798 6,115,370 Accumulated net realized gain (loss) on investments, futures, and foreign currency transactions 8,120,549 (873,668) 58,786,756 10,132,224 5,654,239 Undistributed net investment income 349,608 94,763 192,896 1,093,854 2,720,265 ------------ ------------ ------------ ------------ ------------ Total Net Assets $351,836,262 $712,212,696 $349,593,378 $544,631,351 $175,667,583 ------------ ------------ ------------ ------------ ------------ Net Assets Class A Shares $118,967,111 $ 89,140,198 $ 94,674,157 $182,697,398 $ 65,348,415 ------------ ------------ ------------ ------------ ------------ Class B Shares $ 8,991,592 $ 24,652,354 -- -- $ 350,021 ------------ ------------ ------------ ------------ ------------ Class Y Shares $223,877,559 $598,420,144 $254,919,221 $361,933,953 $109,969,147 ------------ ------------ ------------ ------------ ------------ Shares Outstanding Class A Shares 6,830,417 4,244,152 3,807,705 6,979,128 4,077,085 Class B Shares 519,148 1,178,965 -- -- 21,890 Class Y Shares 12,850,672 28,441,672 10,244,607 13,807,435 6,843,214 ------------ ------------ ------------ ------------ ------------ Total Shares Outstanding 20,200,237 33,864,789 14,052,312 20,786,563 10,942,189 ------------ ------------ ------------ ------------ ------------ Net Asset Value Per Share Class A Shares $ 17.42 $ 21.00 $ 24.86 $ 26.18 $ 16.03 ------------ ------------ ------------ ------------ ------------ Class B Shares $ 17.32 $ 20.91 -- -- $ 15.99 ------------ ------------ ------------ ------------ ------------ Class Y Shares $ 17.42 $ 21.04 $ 24.88 $ 26.21 $ 16.07 ------------ ------------ ------------ ------------ ------------ Offering Price Per Share* Class A Shares $ 18.24** $ 21.99** $ 26.03** $ 27.41** $ 16.79** ------------ ------------ ------------ ------------ ------------ Class B Shares $ 17.32 $ 20.91 -- -- $ 15.99 ------------ ------------ ------------ ------------ ------------ Class Y Shares $ 17.42 $ 21.04 $ 24.88 $ 26.21 $ 16.07 ------------ ------------ ------------ ------------ ------------ Redemption Proceeds Per Share* Class A Shares $ 17.42 $ 21.00 $ 24.86 $ 26.18 $ 16.03 ------------ ------------ ------------ ------------ ------------ Class B Shares $ 16.45*** $ 19.86*** -- -- $ 15.19*** ------------ ------------ ------------ ------------ ------------ Class Y Shares $ 17.42 $ 21.04 $ 24.88 $ 26.21 $ 16.07 ------------ ------------ ------------ ------------ ------------ Investments, at identified cost $257,839,803 $361,717,904 $193,342,506 $281,724,101 $169,645,754 ------------ ------------ ------------ ------------ ------------ Investments, at tax cost $258,746,673 $361,717,904 $193,510,223 $281,729,436 $169,706,043 ------------ ------------ ------------ ------------ ------------
* See "What do Shares Cost" in the Prospectus. ** Computation of Offering Price: 100\95.50 of net asset value. *** Computation of Redemption Price: 95\100 of net asset value. (See Notes which are an integral part of the Financial Statements) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The Wachovia Funds and The Wachovia Municipal Funds Statements of Assets and Liabilities--Continued November 30, 1999
Wachovia Wachovia Wachovia Emerging Personal Wachovia Wachovia Intermediate Markets Equity Balanced Fixed Income Fixed Income Fund Fund Fund Fund Fund - ---------------------------------------------------------------------------------------------------- Assets: Investments in securities, at value $187,890,917 $439,059,133 $638,718,929 $545,123,872 $135,684,402 Investments in repurchase agreements 6,189,219 7,169,987 9,709,927 7,355,266 4,155,232 Cash denominated in foreign currencies 1,083,997 -- -- -- -- Income receivable 337,281 423,196 2,975,783 5,221,210 1,503,498 Receivable for investments sold 275,631 2,854 2,971,567 549,571 440,767 Receivable for shares sold 441,553 -- 535,212 921,028 81,095 ------------ ------------ ------------ ------------ ------------ Total assets 196,218,598 446,655,170 654,911,418 559,170,947 141,864,994 ------------ ------------ ------------ ------------ ------------ Liabilities: Payable for investments purchased 3,436 -- 3,132,722 219,294 23,825 Payable for shares redeemed 1,086,511 1,317,342 523,996 84,376 1,000 Payable for capital gains taxes withheld 368,894 -- -- -- -- Payable for daily variation margin -- 344,925 9,016 132,329 10,031 Payable to adviser 153,608 256,520 340,191 271,878 68,374 Accrued expenses 156,321 174,027 306,699 187,238 49,073 ------------ ------------ ------------ ------------ ------------ Total liabilities 1,768,770 2,092,814 4,312,624 895,115 152,303 ------------ ------------ ------------ ------------ ------------ Net Assets Consist of: Paid in capital 185,713,595 252,555,395 527,490,709 578,280,790 144,472,220 Net unrealized appreciation (depreciation) of investments, futures contracts, and translation of assets and liabilities in foreign currency 34,796,120 183,948,683 118,981,957 (18,537,915) (2,910,922) Accumulated net realized gain (loss) on investments, futures, and foreign currency transactions (27,440,055) 7,806,983 2,066,625 (2,059,929) 33,824 Undistributed net investment income 1,380,168 251,295 2,059,503 592,886 117,569 ------------ ------------ ------------ ------------ ------------ Total Net Assets $194,449,828 $444,562,356 $650,598,794 $558,275,832 $141,712,691 ------------ ------------ ------------ ------------ ------------ Net Assets Class A Shares $ 16,006,640 $ 109,744 $205,166,649 $ 69,475,002 $ 3,205,137 ------------ ------------ ------------ ------------ ------------ Class B Shares -- -- $ 20,926,567 $ 819,074 -- ------------ ------------ ------------ ------------ ------------ Class Y Shares $178,443,188 $444,452,612 $424,505,578 $487,981,756 $138,507,554 ------------ ------------ ------------ ------------ ------------ Shares Outstanding Class A Shares 1,363,725 10,285 15,250,570 7,298,488 334,959 Class B Shares -- -- 1,560,350 86,077 -- Class Y Shares 15,180,508 41,629,797 31,520,188 51,280,029 14,473,236 ------------ ------------ ------------ ------------ ------------ Total Shares Outstanding 16,544,233 41,640,082 48,331,108 58,664,594 14,808,195 ------------ ------------ ------------ ------------ ------------ Net Asset Value Per Share Class A Shares $ 11.74 $ 10.67 $ 13.45 $ 9.52 $ 9.57 ------------ ------------ ------------ ------------ ------------ Class B Shares -- -- $ 13.41 $ 9.52 -- ------------ ------------ ------------ ------------ ------------ Class Y Shares $ 11.75 $ 10.68 $ 13.47 $ 9.52 $ 9.57 ------------ ------------ ------------ ------------ ------------ Offering Price Per Share* Class A Shares $ 12.29** $ 11.17** $ 14.08** $ 9.97** $ 10.02** ------------ ------------ ------------ ------------ ------------ Class B Shares -- -- $ 13.41 $ 9.52 -- ------------ ------------ ------------ ------------ ------------ Class Y Shares $ 11.75 $ 10.68 $ 13.47 $ 9.52 $ 9.57 ------------ ------------ ------------ ------------ ------------ Redemption Proceeds Per Share* Class A Shares $ 11.74 $ 10.67 $ 13.45 $ 9.52 $ 9.57 ------------ ------------ ------------ ------------ ------------ Class B Shares -- -- $ 12.74*** $ 9.04*** -- ------------ ------------ ------------ ------------ ------------ Class Y Shares $ 11.75 $ 10.68 $ 13.47 $ 9.52 $ 9.57 ------------ ------------ ------------ ------------ ------------ Investments, at identified cost $159,271,222 $262,487,978 $529,476,986 $570,881,826 $142,796,517 ------------ ------------ ------------ ------------ ------------ Investments, at tax cost $160,489,346 $262,487,978 $531,063,252 $570,897,953 $142,796,517 ------------ ------------ ------------ ------------ ------------
*See "What do Shares Cost" in the Prospectus. **Computation of Offering Price: 100\95.50 of net asset value. ***Computation of Redemption Price: 95\100 of net asset value. (See Notes which are an integral part of the Financial Statements) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The Wachovia Funds and The Wachovia Municipal Funds Statements of Assets and Liabilities--Continued November 30, 1999
Wachovia Wachovia Wachovia Wachovia North South Wachovia Short Term Georgia Carolina Carolina Virginia Fixed Income Municipal Municipal Municipal Municipal Fund Bond Fund Bond Fund Bond Fund Bond Fund - --------------------------------------------------------------------------------------------------- Assets: Investments in securities, at value $43,716,482 $112,426,009 $437,976,545 $344,167,013 $136,357,480 Investments in repurchase agreements 4,397,275 -- -- -- -- Income receivable 616,771 2,141,141 6,564,286 6,031,642 2,539,742 Receivable for shares sold 82,342 150,000 524,992 -- -- Deferred organizational costs -- -- 8,168 -- -- Other assets -- -- 6,190 -- -- ----------- ------------ ------------ ------------ ------------ Total assets 48,812,870 114,717,150 445,080,181 350,198,655 138,897,222 ----------- ------------ ------------ ------------ ------------ Liabilities: Payable for shares redeemed 26,620 2,181 -- 246,722 785,315 Income distribution payable -- 425,164 1,577,384 1,244,309 516,121 Payable to adviser 18,640 30,905 142,607 109,826 47,215 Accrued expenses 35,365 53,349 192,702 142,187 54,982 ----------- ------------ ------------ ------------ ------------ Total liabilities 80,625 511,599 1,912,693 1,743,044 1,403,633 ----------- ------------ ------------ ------------ ------------ Net Assets Consist of: Paid in capital 52,188,521 116,191,310 446,542,980 350,448,958 139,690,732 Net unrealized appreciation (depreciation) of investments, futures contracts, and translation of assets and liabilities in foreign currency (526,241) (1,425,854) (3,649,501) (2,055,938) (769,281) Accumulated net realized gain (loss) on investments, futures, and foreign currency transactions (3,064,915) (575,481) 245,432 63,977 (1,435,169) Undistributed net investment income 134,880 15,576 28,577 (1,386) 7,307 ----------- ------------ ------------ ------------ ------------ Total Net Assets $48,732,245 $114,205,551 $443,167,488 $348,455,611 $137,493,589 ----------- ------------ ------------ ------------ ------------ Net Assets Class A Shares $10,408,947 $ 5,450,288 $ 8,644,277 $ 59,655,366 $ 7,682,572 ----------- ------------ ------------ ------------ ------------ Class Y Shares $38,323,298 $108,755,263 $434,523,211 $288,800,245 $129,811,017 ----------- ------------ ------------ ------------ ------------ Shares Outstanding Class A Shares 1,080,626 513,760 806,163 5,646,106 780,367 Class Y Shares 3,978,997 10,251,540 40,522,854 27,333,816 13,185,478 ----------- ------------ ------------ ------------ ------------ Total Shares Outstanding 5,059,623 10,765,300 41,329,017 32,979,922 13,965,845 ----------- ------------ ------------ ------------ ------------ Net Asset Value Per Share Class A Shares $ 9.63 $ 10.61 $ 10.72 $ 10.57 $ 9.84 ----------- ------------ ------------ ------------ ------------ Class Y Shares $ 9.63 $ 10.61 $ 10.72 $ 10.57 $ 9.84 ----------- ------------ ------------ ------------ ------------ Offering Price Per Share* Class A Shares $ 9.88*** $ 11.11** $ 11.23** $ 11.07** $ 10.30** ----------- ------------ ------------ ------------ ------------ Class Y Shares $ 9.63 $ 10.61 $ 10.72 $ 10.57 $ 9.84 ----------- ------------ ------------ ------------ ------------ Redemption Proceeds Per Share* Class A Shares $ 9.63 $ 10.61 $ 10.72 $ 10.57 $ 9.84 ----------- ------------ ------------ ------------ ------------ Class Y Shares $ 9.63 $ 10.61 $ 10.72 $ 10.57 $ 9.84 ----------- ------------ ------------ ------------ ------------ Investments, at identified cost $48,639,998 $113,851,863 $441,626,046 $346,222,951 $137,126,761 ----------- ------------ ------------ ------------ ------------ Investments, at tax cost $48,639,998 $113,851,863 $441,637,516 $346,222,951 $137,126,761 ----------- ------------ ------------ ------------ ------------
*See "What do Shares Cost" in the Prospectus. **Computation of Offering Price: 100\95.50 of net asset value. ***Computation of Offering Price: 100\97.50 of net asset value. (See Notes which are an integral part of the Financial Statements) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The Wachovia Funds and The Wachovia Municipal Funds Statements of Operations Year Ended November 30, 1999
Wachovia Wachovia Wachovia Quantitative Wachovia Wachovia Special Equity Equity Growth & Equity Values Fund Fund Income Fund Index Fund Fund - ---------------------------------------------------------------------------------------- Investment Income: Dividends $ 2,554,864 $ 5,462,963 $ 3,540,389 $ 5,817,702 $ 3,317,159 Interest 2,181,840 1,553,806 948,653 2,961,887 1,358,375 ----------- ----------- ----------- ----------- ----------- Total income 4,736,704 7,016,769 4,489,042 8,779,589 4,675,534 ----------- ----------- ----------- ----------- ----------- Expenses: Investment adviser fee 2,103,351 3,185,116 2,356,482 1,507,843 1,322,706 Administrative personnel and services fee 250,356 370,364 281,898 419,626 137,842 Custodian fees 57,567 77,415 62,996 87,126 33,068 Transfer and dividend disbursing agent fees and expenses 25,597 56,460 44,721 11,083 34,647 Trustees' fees 5,180 6,509 8,860 8,407 3,589 Auditing fees 15,520 14,955 15,245 15,165 14,899 Legal fees 5,185 8,784 10,684 8,436 4,236 Portfolio accounting fees 3,003 3,025 2,470 7,107 3,534 Distribution services fee--Class B Shares 54,300 171,432 -- -- 940 Shareholder services fee--Class A Shares 236,058 217,413 340,460 411,379 164,684 Shareholder services fee--Class B Shares 18,100 57,144 -- -- 313 Share registration costs 41,905 153,695 27,951 52,279 37,484 Printing and postage 13,177 14,861 13,992 10,590 20,526 Insurance premiums 1,243 2,146 1,870 2,701 1,218 Miscellaneous 5,169 10,441 10,047 8,177 5,318 ----------- ----------- ----------- ----------- ----------- Total expenses 2,835,711 4,349,760 3,177,676 2,549,919 1,785,004 ----------- ----------- ----------- ----------- ----------- Waivers and reimbursements-- Waiver of investment adviser fee -- -- -- -- (3,432) ----------- ----------- ----------- ----------- ----------- Net expenses 2,835,711 4,349,760 3,177,676 2,549,919 1,781,572 ----------- ----------- ----------- ----------- ----------- Net investment income 1,900,993 2,667,009 1,311,366 6,229,670 2,893,962 ----------- ----------- ----------- ----------- ----------- Realized and Unrealized Gain (Loss) on Investments: Net realized gain on investments, futures contracts and foreign currency transactions 14,330,020 29,407,587 60,678,778 17,541,090 7,161,252 Net change in unrealized appreciation (depreciation) of investments, futures contracts and translation of assets and liabilities in foreign currency 48,286,545 31,769,230 1,531,826 64,241,493 (1,650,644) ----------- ----------- ----------- ----------- ----------- Net realized and unrealized gain (loss) on investments, futures contracts and foreign currency 62,616,565 61,176,817 62,210,604 81,782,583 5,510,608 ----------- ----------- ----------- ----------- ----------- Change in net assets resulting from operations $64,517,558 $63,843,826 $63,521,970 $88,012,253 $ 8,404,570 ----------- ----------- ----------- ----------- -----------
(See Notes which are an integral part of the Financial Statements) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The Wachovia Funds and The Wachovia Municipal Funds Statements of Operations--Continued Year Ended November 30, 1999
Wachovia Wachovia Wachovia Emerging Personal Wachovia Wachovia Intermediate Markets Equity Balanced Fixed Fixed Fund Fund(1) Fund Income Fund Income Fund - -------------------------------------------------------------------------------------------- Investment Income: Dividends $ 2,981,450* $ 1,334,495 $ 3,147,886 $ 1,351,671 $ 339,693 Interest 269,832 406,438 12,899,497 21,605,090 6,224,225 ----------- ----------- ----------- ----------- ----------- Total income 3,251,282 1,740,933 16,047,383 22,956,761 6,563,918 ----------- ----------- ----------- ----------- ----------- Expenses: Investment adviser fee 1,655,474 990,713 3,422,031 2,163,987 635,402 Administrative personnel and services fee 137,802 104,036 402,347 291,783 86,913 Custodian fees 313,931 25,760 83,589 65,590 21,180 Transfer and dividend disbursing agent fees and expenses 36,847 11,000 18,331 17,629 14,772 Trustees' fees 4,874 3,500 7,652 6,342 2,110 Auditing fees 15,968 15,000 14,867 15,121 14,864 Legal fees 9,115 2,000 9,308 10,090 4,311 Portfolio accounting fees 8,191 500 9,641 13,194 1,235 Distribution services fee--Class B Shares -- -- 134,080 5,854 -- Shareholder services fee--Class A Shares 33,617 16 480,755 139,078 9,931 Shareholder services fee--Class B Shares -- -- 44,693 1,951 -- Share registration costs 32,014 125,922 97,685 99,016 24,139 Printing and postage 15,223 5,000 11,456 14,264 15,279 Insurance premiums 2,382 4,500 3,014 1,310 1,027 Miscellaneous 4,182 5,000 13,399 8,068 4,302 ----------- ----------- ----------- ----------- ----------- Total expenses 2,269,620 1,292,947 4,752,848 2,853,277 835,465 ----------- ----------- ----------- ----------- ----------- Waivers and reimbursements-- Waiver of investment adviser fee -- (15,909) (372,597) (110,201) (42,003) ----------- ----------- ----------- ----------- ----------- Net expenses 2,269,620 1,277,038 4,380,251 2,743,076 793,462 ----------- ----------- ----------- ----------- ----------- Net investment income 981,662 463,895 11,667,132 20,213,685 5,770,456 ----------- ----------- ----------- ----------- ----------- Realized and Unrealized Gain (Loss) on Investments: Net realized gain (loss) on investments, futures contracts and foreign currency transactions 2,891,987** 7,806,983 21,074,744 (1,975,659) 35,200 Net change in unrealized appreciation (depreciation) of investments, futures contracts and translation of assets and liabilities in foreign currency 52,585,006 20,381,700 37,368,946 (16,216,784) (5,768,480) ----------- ----------- ----------- ----------- ----------- Net realized and unrealized gain (loss) on investments, futures contracts and foreign currency 55,476,993 28,188,683 58,443,690 (18,192,443) (5,733,280) ----------- ----------- ----------- ----------- ----------- Change in net assets resulting from operations $56,458,655 $28,652,578 $70,110,822 $ 2,021,242 $ 37,176 ----------- ----------- ----------- ----------- -----------
*Net of foreign taxes withheld of $221,723. **Net of foreign capital gain taxes of $243,267. (1)Reflects operations for the period from July 30, 1999 (date of initial public investment) to November 30, 1999. (See Notes which are an integral part of the Financial Statements) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The Wachovia Funds and The Wachovia Municipal Funds Statements of Operations--Continued Year Ended November 30, 1999
Wachovia Wachovia Wachovia Wachovia North South Wachovia Short Term Georgia Carolina Carolina Virginia Fixed Municipal Municipal Municipal Municipal Income Fund Bond Fund Bond Fund Bond Fund Bond Fund - --------------------------------------------------------------------------------------------- Investment Income: Dividends $ 82,738 $ -- $ -- $ -- $ -- Interest 3,236,702 2,837,197 9,635,223 10,846,610 6,259,975 ----------- ----------- ------------ ------------ ----------- Total income 3,319,440 2,837,197 9,635,223 10,846,610 6,259,975 ----------- ----------- ------------ ------------ ----------- Expenses: Investment adviser fee 310,181 415,853 1,466,791 1,507,188 876,247 Administrative personnel and services fee 47,798 43,476 151,115 160,810 98,127 Custodian fees 11,279 11,089 35,897 38,504 23,682 Transfer and dividend disbursing agent fees and expenses 6,534 11,891 18,169 8,773 15,611 Trustees' fees 2,607 2,386 2,677 2,960 2,987 Auditing fees 15,099 15,394 15,245 15,022 13,368 Legal fees 6,010 5,777 5,138 5,917 5,203 Portfolio accounting fees 3,019 9,316 17,834 15,110 12,793 Shareholder services fee--Class A Shares 25,565 15,941 23,325 162,729 21,071 Share registration costs 15,451 45,425 115,004 86,928 31,895 Printing and postage 10,816 11,275 18,712 26,018 24,825 Insurance premiums 1,049 1,000 891 1,120 833 Miscellaneous 4,175 11,283 16,542 4,980 6,347 ----------- ----------- ------------ ------------ ----------- Total expenses 459,583 600,106 1,887,340 2,036,059 1,132,989 ----------- ----------- ------------ ------------ ----------- Waivers and reimbursements-- Waiver of investment adviser fee (78,764) (198,440) (568,554) (709,176) (344,472) ----------- ----------- ------------ ------------ ----------- Net expenses 380,819 401,666 1,318,786 1,326,883 788,517 ----------- ----------- ------------ ------------ ----------- Net investment income 2,938,621 2,435,531 8,316,437 9,519,727 5,471,458 ----------- ----------- ------------ ------------ ----------- Realized and Unrealized Gain (Loss) on Investments: Net realized gain (loss) on investments, futures contracts and foreign currency transactions 491,231 (561,411) 263,247 64,300 169,324 Net change in unrealized appreciation (depreciation) of investments, futures contracts and translation of assets and liabilities in foreign currency (1,634,947) (3,747,837) (13,454,369) (15,832,915) (7,994,414) ----------- ----------- ------------ ------------ ----------- Net realized and unrealized gain (loss) on investments, futures contracts and foreign currency (1,143,716) (4,309,248) (13,191,122) (15,768,615) (7,825,090) ----------- ----------- ------------ ------------ ----------- Change in net assets resulting from operations $ 1,794,905 $(1,873,717) $ (4,874,685) $ (6,248,888) $(2,353,632) ----------- ----------- ------------ ------------ -----------
(See Notes which are an integral part of the Financial Statements) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The Wachovia Funds and The Wachovia Municipal Funds Statements of Changes in Net Assets
Wachovia Wachovia Wachovia Equity Fund Quantitative Equity Fund Growth & Income Fund ------------------------------------------------------------------------------------- Year Year Year Year Year Year Ended Ended Ended Ended Ended Ended November 30, November 30, November 30, November 30, November 30, November 30, 1999 1998 1999 1998 1999 1998 - ------------------------------------------------------------------------------------------------------------- Increase (Decrease) in Net Assets: Operations-- Net investment income $ 1,900,993 $ 2,562,164 $ 2,667,009 $ 3,010,939 $ 1,311,366 $ 2,327,051 Net realized gain (loss) on investments and futures contracts 14,330,020 25,423,254 29,407,587 8,106,935 60,678,778 39,310,322 Net change in unrealized appreciation (depreciation) of investments and futures contracts 48,286,545 9,686,441 31,769,230 34,370,766 1,531,826 20,725,093 ------------ ------------ ------------ ------------ ------------ ------------ Change in net assets resulting from operations 64,517,558 37,671,859 63,843,826 45,488,640 63,521,970 62,362,466 ------------ ------------ ------------ ------------ ------------ ------------ Distributions to Shareholders-- Distributions from net investment income Class A Shares (362,278) (434,085) (504,434) (550,325) (456,714) (1,096,382) Class B Shares (293) (9,956) (10,684) (38,995) -- -- Class Y Shares (1,373,680) (2,078,302) (2,379,853) (2,433,040) (1,160,298) (847,829) Distributions from net realized gain on investments and futures contracts Class A Shares (6,403,780) (4,382,604) (9,777,137) (3,354,334) (15,960,065) (16,598,781) Class B Shares (682,925) (386,343) (2,553,864) (633,226) -- -- Class Y Shares (23,092,487) (17,186,819) (25,353,209) (16,891,130) (25,242,279) -- ------------ ------------ ------------ ------------ ------------ ------------ Change in net assets from distributions to shareholders (31,915,443) (24,478,109) (40,579,181) (23,901,050) (42,819,356) (18,542,992) ------------ ------------ ------------ ------------ ------------ ------------ Share Transactions-- Proceeds from sale of shares 126,213,398 79,804,293 45,216,048 85,542,784 79,304,120 228,486,710 Proceeds from shares issued in connection with the tax-free transfer of assets from a Common Trust Fund -- -- 373,318,412 -- -- -- Net asset value of shares issued to shareholders in payment of dividends declared 24,618,584 18,768,160 36,090,601 21,884,659 20,328,598 9,768,460 Cost of shares redeemed (90,750,849) (51,792,656) (75,233,898) (44,449,005) (107,223,683) (284,316,544) ------------ ------------ ------------ ------------ ------------ ------------ Change in net assets from share transactions 60,081,133 46,779,797 379,391,163 62,978,438 (7,590,965) (46,061,374) ------------ ------------ ------------ ------------ ------------ ------------ Change in net assets 92,683,248 59,973,547 402,655,808 84,566,028 13,111,649 (2,241,900) Net Assets: Beginning of period 259,153,014 199,179,467 309,556,888 224,990,860 336,481,729 338,723,629 ------------ ------------ ------------ ------------ ------------ ------------ End of period $351,836,262 $259,153,014 $712,212,696 $309,556,888 $349,593,378 $336,481,729 ------------ ------------ ------------ ------------ ------------ ------------ Undistributed net investment income included in net assets at end of period $ 349,608 $ 184,893 $ 94,763 $ 322,725 $ 192,896 $ 498,542 ------------ ------------ ------------ ------------ ------------ ------------ Net gain as computed for federal tax purposes $ 10,259,620 $ 29,886,669 $ 26,412,197 $ 11,277,361 $ 59,248,423 $ 41,201,605 ------------ ------------ ------------ ------------ ------------ ------------
(See Notes which are an integral part of the Financial Statements) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The Wachovia Funds and The Wachovia Municipal Funds Statements of Changes in Net Assets--Continued
Wachovia Wachovia Equity Index Fund Special Values Fund --------------------------------------------------------- Year Year Year Year Ended Ended Ended Ended November 30, November 30, November 30, November 30, 1999 1998 1999 1998 - --------------------------------------------------------------------------------- Increase (Decrease) in Net Assets: Operations-- Net investment income $ 6,229,670 $ 5,003,197 $ 2,893,962 $ 1,701,412 Net realized gain on investments and futures contracts 17,541,090 421,731 7,161,252 5,464,983 Net change in unrealized appreciation (depreciation) of investments and futures contracts 64,241,493 68,214,882 (1,650,644) (15,392,292) ------------ ------------ ------------ ------------ Change in net assets resulting from operations 88,012,253 73,639,810 8,404,570 (8,225,897) ------------ ------------ ------------ ------------ Distributions to Shareholders-- Distributions from net investment income Class A Shares (1,667,787) (945,159) (597,826) (273,707) Class B Shares -- -- -- -- Class Y Shares (4,270,929) (3,814,497) (1,140,362) (656,635) Distributions from net realized gain on investments and futures contracts Class A Shares (2,179,495) (1,188,632) (2,756,902) (3,883,188) Class B Shares -- -- -- -- Class Y Shares (4,801,448) (5,186,506) (4,195,184) (7,685,327) ------------ ------------ ------------ ------------ Change in net assets from distributions to shareholders (12,919,659) (11,134,794) (8,690,274) (12,498,857) ------------ ------------ ------------ ------------ Share Transactions-- Proceeds from sale of shares 148,792,010 134,592,835 55,734,701 70,849,082 Proceeds from shares issued in connection with the tax-free transfer of assets from a Common Trust Fund -- -- 6,217,889 -- Net asset value of shares issued to shareholders in payment of dividends declared 12,226,266 10,713,271 7,362,549 11,067,462 Cost of shares redeemed (114,781,275) (83,275,340) (43,319,704) (33,500,251) ------------ ------------ ------------ ------------ Change in net assets from share transactions 46,237,001 62,030,766 25,995,435 48,416,293 ------------ ------------ ------------ ------------ Change in net assets 121,329,595 124,535,782 25,709,731 27,691,539 Net Assets: Beginning of period 423,301,756 298,765,974 149,957,852 122,266,313 ------------ ------------ ------------ ------------ End of period $544,631,351 $423,301,756 $175,667,583 $149,957,852 ------------ ------------ ------------ ------------ Undistributed net investment income included in net assets at end of period $ 1,093,854 $ 802,900 $ 2,752,766 $ 1,564,491 ------------ ------------ ------------ ------------ Net gain as computed for federal tax purposes $ 11,284,463 $ 7,032,936 $ 5,879,628 $ 6,952,058 ------------ ------------ ------------ ------------
(See Notes which are an integral part of the Financial Statements) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The Wachovia Funds and The Wachovia Municipal Funds Statements of Changes in Net Assets--Continued
Wachovia Wachovia Personal Wachovia Emerging Markets Fund Equity Fund Balanced Fund ----------------------------------------------------------------------- Year Year Period Year Year Ended Ended Ended Ended Ended November 30, November 30, November 30, November 30, November 30, 1999 1998 1999(1) 1999 1998 - ---------------------------------------------------------------------------------------------- Increase (Decrease) in Net Assets: Operations-- Net investment income $ 981,662 $ 1,727,317 $ 463,895 $ 11,667,132 $ 11,937,638 Net realized gain (loss) on investments, futures contracts and foreign currency transactions 2,891,987 (26,904,345) 7,806,983 21,074,744 34,803,316 Net change in unrealized appreciation (depreciation) of investments, futures contracts and translation of assets and liabilities in foreign currency 52,585,006 (16,292,727) 20,381,700 37,368,946 5,465,835 ------------ ------------ ------------ ------------ ------------ Change in net assets resulting from operations 56,458,655 (41,469,755) 28,652,578 70,110,822 52,206,789 ------------ ------------ ------------ ------------ ------------ Distributions to Shareholders-- Distributions from net investment income Class A Shares (48,950) (79,885) -- (4,340,110) (2,395,836) Class B Shares -- -- -- (276,558) (210,069) Class Y Shares (1,079,581) (1,627,997) (212,600) (6,781,441) (9,025,669) Distributions from net realized gain on investments, futures contracts and foreign currency Class A Shares -- -- -- (17,377,408) (3,838,968) Class B Shares -- -- -- (1,929,181) (425,121) Class Y Shares -- -- -- (32,938,534) (16,816,255) ------------ ------------ ------------ ------------ ------------ Change in net assets from distributions to shareholders (1,128,531) (1,707,882) (212,600) (63,643,232) (32,711,918) ------------ ------------ ------------ ------------ ------------ Share Transactions-- Proceeds from sale of shares 35,132,998 59,662,218 2,244,187 216,793,701 167,115,147 Proceeds from shares issued in connection with the tax-free transfer of assets from a Common Trust Fund -- -- 428,394,696 249,842,105 -- Net asset value of shares issued to shareholders in payment of dividends declared 384,631 616,589 63 57,849,606 30,283,351 Cost of shares redeemed (35,972,883) (25,222,374) (14,516,568) (304,243,599) (99,971,459) ------------ ------------ ------------ ------------ ------------ Change in net assets from share transactions (455,254) 35,056,433 416,122,378 220,241,813 97,427,039 ------------ ------------ ------------ ------------ ------------ Change in net assets 54,874,870 (8,121,204) 444,562,356 226,709,403 116,921,910 Net Assets: Beginning of period 139,574,958 147,696,162 -- 423,889,391 306,967,481 ------------ ------------ ------------ ------------ ------------ End of period $194,449,828 $139,574,958 $444,562,356 $650,598,794 $423,889,391 ------------ ------------ ------------ ------------ ------------ Undistributed net investment income included in net assets at end of period $ 1,380,168 $ 861,148 $ 251,295 $ 2,059,503 $ 1,790,481 ------------ ------------ ------------ ------------ ------------ Net gain (loss) as computed for federal tax purposes $ 2,465,582 $(25,282,206) $ 8,014,524 $ 17,205,726 $ 39,461,216 ------------ ------------ ------------ ------------ ------------
(1) Reflects operations for the period from July 30, 1999 (date of initial public investment) to November 30, 1999. (See Notes which are an integral part of the Financial Statements) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The Wachovia Funds and The Wachovia Municipal Funds Statements of Changes in Net Assets--Continued
Wachovia Wachovia Wachovia Short- Fixed Income Fund Intermediate Fixed Income Fund Term Fixed Income Fund ------------------------------------------------------------------------------------------- Year Year Year Year Year Year Ended Ended Ended Ended Ended Ended November 30, November 30, November 30, November 30, November 30, November 30, 1999 1998 1999 1998 1999 1998 - ------------------------------------------------------------------------------------------------------------------ Increase (Decrease) in Net Assets: Operations-- Net investment income $ 20,213,685 $ 12,119,208 $ 5,770,456 $ 5,108,991 $ 2,938,621 $ 5,662,695 Net realized gain (loss) on investments and futures contracts (1,975,659) 3,568,877 35,200 4,965,732 491,231 536,985 Net change in unrealized appreciation (depreciation) of investments and futures contracts (16,216,784) 2,972,507 (5,768,480) (1,521,439) (1,634,947) 920,118 ------------- ------------ -------------- --------------- ------------ ------------ Change in net assets resulting from operations 2,021,242 18,660,592 37,176 8,553,284 1,794,905 7,119,798 ------------- ------------ -------------- --------------- ------------ ------------ Distributions to Shareholders-- Distributions from net investment income Class A Shares (2,884,514) (940,460) (202,679) (2,130,033) (547,972) (502,454) Class B Shares (35,054) (16,381) -- -- -- -- Class Y Shares (16,617,132) (11,358,420) (5,512,076) (3,157,720) (2,779,470) (5,081,639) Distributions from net realized gain on investments and futures contracts Class A Shares (111,279) -- (92,062) -- -- -- Class B Shares (2,141) -- -- -- -- -- Class Y Shares (741,696) -- (1,701,330) -- -- -- ------------- ------------ -------------- --------------- ------------ ------------ Change in net assets from distributions to shareholders (20,391,816) (12,315,261) (7,508,147) (5,287,753) (3,327,442) (5,584,093) ------------- ------------ -------------- --------------- ------------ ------------ Share Transactions-- Proceeds from sale of shares 165,467,506 81,647,518 20,483,149 99,110,496 13,979,811 28,878,718 Proceeds from shares issued in connection with the tax-free transfer of assets from a Common Trust Fund 265,851,176 -- 59,122,769 -- 7,116,836 -- Net asset value of shares issued to shareholders in payment of distributions declared 9,617,907 7,498,622 651,094 592,995 2,803,311 5,384,024 Cost of shares redeemed (102,333,202) (53,025,914) (23,663,167) (107,004,830) (82,504,658) (25,225,385) ------------- ------------ -------------- --------------- ------------ ------------ Change in net assets from share transactions 338,603,387 36,120,226 56,593,845 (7,301,339) (58,604,700) 9,037,357 ------------- ------------ -------------- --------------- ------------ ------------ Change in net assets 320,232,813 42,465,557 49,122,874 (4,035,808) (60,137,237) 10,573,062 Net Assets: Beginning of period 238,043,019 195,577,462 92,589,817 96,625,625 108,869,482 98,296,420 ------------- ------------ -------------- --------------- ------------ ------------ End of period $ 558,275,832 $238,043,019 $ 141,712,691 $ 92,589,817 $ 48,732,245 $108,869,482 ------------- ------------ -------------- --------------- ------------ ------------ Undistributed net investment income included in net assets at end of period $ 592,886 $ -- $ 117,569 $ 61,868 $ 134,880 $ 523,701 ------------- ------------ -------------- --------------- ------------ ------------ Net gain (loss) as computed for federal tax purposes $ (2,177,586) $ 3,793,537 $ 79,785 $ 4,972,877 $ 491,231 $ 531,738 ------------- ------------ -------------- --------------- ------------ ------------
(See Notes which are an integral part of the Financial Statements) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The Wachovia Funds and The Wachovia Municipal Funds Statements of Changes in Net Assets--Continued
Wachovia Wachovia Georgia Municipal North Carolina Municipal Bond Fund Bond Fund ------------------------------------------------------- Year Year Year Year Ended Ended Ended Ended November 30, November 30, November 30, November 30, 1999 1998 1999 1998 - --------------------------------------------------------------------------------- Increase (Decrease) in Net Assets: Operations-- Net investment income $ 2,435,531 $ 825,254 $ 8,316,437 $ 2,437,336 Net realized gain (loss) on investments (561,411) 61,857 263,247 327,825 Net change in unrealized appreciation (depreciation) of investments (3,747,837) 428,018 (13,454,369) 1,360,515 ------------ ----------- ------------ ----------- Change in net assets resulting from operations (1,873,717) 1,315,129 (4,874,685) 4,125,676 ------------ ----------- ------------ ----------- Distributions to Shareholders-- Distributions from net investment income Class A Shares (245,913) (251,879) (354,496) (393,274) Class Y Shares (2,174,539) (573,430) (7,981,753) (2,044,014) Distributions from net realized gain on investments Class A Shares (17,469) (2,076) (47,957) (6,494) Class Y Shares (43,655) (3,949) (279,986) (25,032) ------------ ----------- ------------ ----------- Change in net assets from distributions to shareholders (2,481,576) (831,334) (8,664,192) (2,468,814) ------------ ----------- ------------ ----------- Share Transactions-- Proceeds from sale of shares 13,513,690 6,541,536 40,895,769 17,216,738 Proceeds from shares issued in connection with the tax-free transfer of assets from a Common Trust Fund 88,191,199 -- 366,043,958 -- Net asset value of shares issued to shareholders in payment of distributions declared 290,940 271,955 717,052 527,425 Cost of shares redeemed (7,365,394) (2,205,784) (17,244,173) (8,774,593) ------------ ----------- ------------ ----------- Change in net assets from share transactions 94,630,435 4,607,707 390,412,606 8,969,570 ------------ ----------- ------------ ----------- Change in net assets 90,275,142 5,091,502 376,873,729 10,626,432 Net Assets: Beginning of period 23,930,409 18,838,907 66,293,759 55,667,327 ------------ ----------- ------------ ----------- End of period $114,205,551 $23,930,409 $443,167,488 $66,293,759 ------------ ----------- ------------ ----------- Undistributed net investment income included in net assets at end of period $ 15,576 $ 497 $ 28,577 $ 48 ------------ ----------- ------------ ----------- Net gain (loss) as computed for federal tax purposes $ (575,481) $ 61,164 $ 257,307 $ 327,826 ------------ ----------- ------------ -----------
(See Notes which are an integral part of the Financial Statements) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The Wachovia Funds and The Wachovia Municipal Funds Statements of Changes in Net Assets--Continued
Wachovia Wachovia South Carolina Municipal Virginia Municipal Bond Fund Bond Fund ----------------------------------------------------------- Year Year Year Year Ended Ended Ended Ended November 30, November 30, November 30, November 30, 1999 1998 1999 1998 - --------------------------------------------------------------------------------- Increase (Decrease) in Net Assets: Operations-- Net investment income $ 9,519,727 $ 5,366,704 $ 5,471,458 $ 4,906,389 Net realized gain on investments 64,300 209,185 169,324 723,926 Net change in unrealized appreciation (depreciation) of investments (15,832,915) 2,123,645 (7,994,414) 1,656,976 ------------ ------------ ------------ ------------- Change in net assets resulting from operations (6,248,888) 7,699,534 (2,353,632) 7,287,291 ------------ ------------ ------------ ------------- Distributions to Shareholders-- Distributions from net investment income Class A Shares (2,932,843) (2,984,948) (366,695) (2,135,085) Class Y Shares (6,591,278) (2,379,402) (5,090,199) (3,026,800) Distributions from net realized gain on investments Class A Shares (116,632) (5,753) -- -- Class Y Shares (92,877) (4,021) -- -- ------------ ------------ ------------ ------------- Change in net assets from distributions to shareholders (9,733,630) (5,374,124) (5,456,894) (5,161,885) ------------ ------------ ------------ ------------- Share Transactions-- Proceeds from sale of shares 37,278,910 23,937,897 26,296,082 110,194,596 Proceeds from shares issued in connection with the tax-free transfer of assets from a Common Trust Fund 225,809,305 -- 32,818,769 -- Net asset value of shares issued to shareholders in payment of distributions declared 2,188,807 2,037,672 555,659 341,749 Cost of shares redeemed (23,066,610) (14,650,172) (22,355,749) (115,832,370) ------------ ------------ ------------ ------------- Change in net assets from share transactions 242,210,412 11,325,397 37,314,761 (5,296,025) ------------ ------------ ------------ ------------- Change in net assets 226,227,894 13,650,807 29,504,235 (3,170,619) Net Assets: Beginning of period 122,227,717 108,576,910 107,989,354 111,159,973 ------------ ------------ ------------ ------------- End of period $348,455,611 $122,227,717 $137,493,589 $ 107,989,354 ------------ ------------ ------------ ------------- Undistributed net investment income included in net assets at end of period $ (1,386) $ 3,008 $ 7,307 $ (7,257) ------------ ------------ ------------ ------------- Net gain (loss) as computed for federal tax purposes $ 64,300 $ 207,167 $ 169,324 $ 723,926 ------------ ------------ ------------ -------------
(See Notes which are an integral part of the Financial Statements) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The Wachovia Funds and The Wachovia Municipal Funds Financial Highlights--Class A Shares (For a share outstanding throughout each period)
Distributions from Net Net Realized and Realized Gain on Net Asset Unrealized Gain/(Loss) on Distributions Investment Transactions and Value, Net Investments and Futures Total from from Net Futures Contracts Year Ended beginning Investment Contracts, and Foreign Investment Investment and Foreign Total November 30, of period Income Currency Transactions Operations Income Currency Transactions Distributions - ------------------------------------------------------------------------------------------------------------------------------- Wachovia Equity Fund 1995 $10.32 0.23 2.64 2.87 (0.25) (0.23) (0.48) 1996 $12.71 0.22(4) 2.83 3.05 (0.22) (0.73) (0.95) 1997 $14.81 0.14(4) 2.43 2.57 (0.13) (1.86) (1.99) 1998 $15.39 0.13(4) 2.21 2.34 (0.14) (1.68) (1.82) 1999 $15.91 0.06 3.41 3.47 (0.07) (1.89) (1.96) Wachovia Quantitative Equity Fund 1995 $ 9.60 0.22 3.51 3.73 (0.22) -- (0.22) 1996 $13.11 0.24(4) 2.77 3.01 (0.21) (0.24) (0.45) 1997 $15.67 0.18(4) 4.14 4.32 (0.20) (0.79) (0.99) 1998 $19.00 0.11(4) 3.12 3.23 (0.19) (1.75) (1.94) 1999 $20.29 0.09 3.16 3.25 (0.12) (2.42) (2.54) Wachovia Growth & Income Fund 1995 $ 9.80 0.17 3.09 3.26 (0.18) -- (0.18) 1996 $12.88 0.15 3.67 3.82 (0.15) (0.14) (0.29) 1997 $16.41 0.13 4.44 4.57 (0.13) (0.25) (0.38) 1998 $20.60 0.11 3.94 4.05 (0.10) (1.01) (1.11) 1999 $23.54 0.05 4.24 4.29 (0.08) (2.89) (2.97) Wachovia Equity Index Fund 1995 $10.27 0.28 3.37 3.65 (0.27) (0.03) (0.30) 1996 $13.62 0.32(4) 3.13 3.45 (0.31) (0.78) (1.09) 1997 $15.98 0.25(4) 3.85 4.10 (0.28) (0.91) (1.19) 1998 $18.89 0.26(4) 3.90 4.16 (0.24) (0.40) (0.64) 1999 $22.41 0.27 4.13 4.40 (0.26) (0.37) (0.63) Wachovia Special Values Fund 1995 $ 9.75 0.09 2.42 2.51 (0.02) (0.06) (0.08) 1996 $12.18 0.35 4.13 4.48 (0.08) (0.91) (0.99) 1997 $15.67 0.13(4) 4.53 4.66 (0.08) (1.61) (1.69) 1998 $18.64 0.19(4) (0.87) (0.68) (0.12) (1.71) (1.83) 1999 $16.13 0.25 0.56 0.81 (0.16) (0.75) (0.91) Wachovia Emerging Markets Fund 1995(1) $10.00 0.05 0.36 0.41 -- -- -- 1996 $10.41 0.09(4) 1.20 1.29 (0.03) -- (0.03) 1997 $11.67 0.03(4) (0.47) (0.44) (0.11) -- (0.11) 1998 $11.12 0.09(4) (2.68) (2.59) (0.10) -- (0.10) 1999 $ 8.43 0.04(4) 3.32 3.36 (0.05) -- (0.05) Wachovia Personal Equity Fund 1999(6) $10.00 0.01 0.67 0.68 (0.01) -- (0.01)
(1) Reflects operations for the period from December 26, 1994 (date of initial public investment) to November 30, 1995. (2) Based on net asset value, which does not reflect the sales charge or contingent deferred sales charge, if applicable. (3) This contractual expense decrease is reflected in both the expense and net investment income ratios. (4) Per share information is based on average shares outstanding. (5) Computed on an annualized basis. (6) Reflects operations for the period from July 30, 1999 (date of initial public investment) to November 30, 1999. (7) Less then 0.01%. (See Notes which are an integral part of the Financial Statements) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The Wachovia Funds and The Wachovia Municipal Funds Financial Highlights--Class A Shares (For a share outstanding throughout each period)
Ratios to Average Net Assets --------------------------------------- Net Asset Net Net Assets, Portfolio Year Ended Value, end Total Investment Expense Waiver/ end of period Turnover November 30, of period Return(2) Expenses Income Reimbursement(3) (000 omitted) Rate - --------------------------------------------------------------------------------------------------- Wachovia Equity Fund 1995 $12.71 28.74% 0.90% 1.99% 0.07% $130,150 65% 1996 $14.81 25.56% 0.90% 1.62% 0.15% $ 20,774 64% 1997 $15.39 20.22% 1.14% 0.95% 0.07% $ 39,494 124% 1998 $15.91 17.34% 1.12% 0.91% -- $ 53,103 150% 1999 $17.42 24.31% 1.09% 0.49% -- $118,967 45% Wachovia Quantitative Equity Fund 1995 $13.11 39.33% 0.87% 1.93% 0.10% $121,895 63% 1996 $15.67 23.74% 0.87% 1.70% 0.15% $ 15,742 44% 1997 $19.00 29.38% 1.11% 1.09% 0.07% $ 35,413 74% 1998 $20.29 18.98% 1.11% 0.95% -- $ 82,682 38% 1999 $21.00 16.60% 1.11% 0.48% -- $ 89,140 34% Wachovia Growth & Income Fund 1995 $12.88 33.59% 1.35% 1.58% 0.36% $119,484 30% 1996 $16.41 30.10% 1.35% 1.04% 0.31% $186,147 12% 1997 $20.60 28.50% 1.30% 0.70% 0.30% $338,724 13% 1998 $23.54 20.77% 1.21% 0.59% 0.08% $130,306 24% 1999 $24.86 20.40% 1.09% 0.24% -- $ 94,674 44% Wachovia Equity Index Fund 1995 $13.62 36.15% 0.48% 2.39% 0.05% $186,841 60% 1996 $15.98 27.19% 0.48% 2.23% 0.13% $ 18,154 12% 1997 $18.89 27.55% 0.72% 1.46% 0.02% $ 50,917 4% 1998 $22.41 22.74% 0.70% 1.23% -- $131,594 29% 1999 $26.18 19.97% 0.69% 1.07% -- $182,697 11% Wachovia Special Values Fund 1995 $12.18 25.91% 1.29% 0.80% 0.58% $ 24,093 57% 1996 $15.67 39.78% 1.21% 0.47% 0.29% $ 6,642 38% 1997 $18.64 33.08% 1.35% 0.74% 0.01% $ 37,766 46% 1998 $16.13 (3.86%) 1.25% 0.98% -- $ 59,408 20% 1999 $16.03 5.40% 1.23% 1.61% 0.00%(7) $ 65,348 44% Wachovia Emerging Markets Fund 1995(1) $10.41 4.10% 1.80%(5) 0.85%(5) 0.28%(5) $ 71,276 17% 1996 $11.67 12.45% 1.69% 0.73% 0.09% $ 5,488 30% 1997 $11.12 (3.82%) 1.79% 0.26% -- $ 7,996 60% 1998 $ 8.43 (23.46%) 1.68% 0.90% -- $ 8,677 51% 1999 $11.74 40.07% 1.60% 0.37% -- $ 16,007 56% Wachovia Personal Equity Fund 1999(6) $10.67 6.75% 1.15%(5) 0.39%(5) 0.01%(5) $ 110 11%
(1) Reflects operations for the period from December 26, 1994 (date of initial public investment) to November 30, 1995. (2) Based on net asset value, which does not reflect the sales charge or contingent deferred sales charge, if applicable. (3) This contractual expense decrease is reflected in both the expense and net investment income ratios. (4) Per share information is based on average shares outstanding. (5) Computed on an annualized basis. (6) Reflects operations for the period from July 30, 1999 (date of initial public investment) to November 30, 1999. (7) Less than 0.01%. (See Notes which are an integral part of the Financial Statements) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The Wachovia Funds and The Wachovia Municipal Funds Financial Highlights--Class A Shares (For a share outstanding throughout each period)
Distributions Net Asset Net Realized and Distributions from Net Value, Net Unrealized Gain/(Loss) Total from from Net Realized Gain on Year Ended beginning Investment on Investments Investment Investment Investment Transaction Total November 30, of period Income and Futures Contracts Operations Income and Futures Contracts Distributions - ----------------------------------------------------------------------------------------------------------------------- Wachovia Balanced Fund 1995 $ 9.93 0.40 2.13 2.53 (0.38) (0.16) (0.54) 1996 $11.92 0.38(4) 1.72 2.10 (0.38) (0.34) (0.72) 1997 $13.30 0.34(4) 1.40 1.74 (0.34) (1.44) (1.78) 1998 $13.26 0.24(4) 1.50 1.74 (0.38) (0.90) (1.28) 1999 $13.72 0.29 1.44 1.73 (0.31) (1.69) (2.00) Wachovia Fixed Income Fund 1995 $ 8.97 0.58 0.92 1.50 (0.57) -- (0.57) 1996 $ 9.90 0.61(4) (0.09) 0.52 (0.59) -- (0.59) 1997 $ 9.83 0.54(4) 0.04 0.58 (0.56) -- (0.56) 1998 $ 9.85 0.53(4) 0.30 0.83 (0.54) -- (0.54) 1999 $10.14 0.51 (0.58) (0.07) (0.51) (0.04) (0.55) Wachovia Intermediate Fixed Income Fund 1995 $ 9.31 0.55 0.76 1.31 (0.55) -- (0.55) 1996 $10.07 0.55 (0.11) 0.44 (0.55) -- (0.55) 1997 $ 9.96 0.54 0.06 0.60 (0.53) -- (0.53) 1998 $10.03 0.47 0.40 0.87 (0.52) -- (0.52) 1999 $10.38 0.50 (0.61) (0.11) (0.50) (0.20) (0.70) Wachovia Short-Term Fixed Income Fund 1995 $ 9.58 0.59 0.24 0.83 (0.52) -- (0.52) 1996 $ 9.89 0.56(4) (0.06) 0.50 (0.60) -- (0.60) 1997 $ 9.79 0.50(4) (0.01) 0.49 (0.51) -- (0.51) 1998 $ 9.77 0.52(4) 0.14 0.66 (0.51) -- (0.51) 1999 $ 9.92 0.48 (0.25) 0.23 (0.52) -- (0.52) Wachovia Georgia Municipal Bond Fund 1995(1) $10.00 0.41 0.96 1.37 (0.41) -- (0.41) 1996 $10.96 0.47 0.05 0.52 (0.47) (0.01) (0.48) 1997 $11.00 0.44 0.13 0.57 (0.44) (0.02) (0.46) 1998 $11.11 0.42 0.27 0.69 (0.42) (0.00)(6) (0.42) 1999 $11.38 0.43 (0.74) (0.31) (0.43) (0.03) (0.46) Wachovia North Carolina Municipal Bond Fund 1995(1) $10.00 0.43 0.99 1.42 (0.43) -- (0.43) 1996 $10.99 0.45 0.09 0.54 (0.45) (0.05) (0.50) 1997 $11.03 0.43 0.14 0.57 (0.43) (0.02) (0.45) 1998 $11.15 0.43 0.32 0.75 (0.43) (0.01) (0.44) 1999 $11.46 0.42 (0.68) (0.26) (0.42) (0.06) (0.48) Wachovia South Carolina Municipal Bond Fund 1995 $10.05 0.56 1.10 1.66 (0.56) (0.10) (0.66) 1996 $11.05 0.55 0.03 0.58 (0.55) (0.03) (0.58) 1997 $11.05 0.53 0.11 0.64 (0.52) (0.05) (0.57) 1998 $11.12 0.51 0.24 0.75 (0.51) (0.00)(6) (0.51) 1999 $11.36 0.50 (0.77) (0.27) (0.50) (0.02) (0.52) Wachovia Virginia Municipal Bond Fund 1995 $ 9.40 0.42 0.85 1.27 (0.42) -- (0.42) 1996 $10.25 0.44 (0.10) 0.34 (0.44) -- (0.44) 1997 $10.15 0.46 0.13 0.59 (0.45) -- (0.45) 1998 $10.29 0.48 0.14 0.62 (0.48) -- (0.42) 1999 $10.49 0.45 (0.65) (0.20) (0.45) -- (0.45)
(1) Reflects operations for the period from December 26, 1994 (date of initial public investment) to November 30, 1995. (2) Based on net asset value, which does not reflect the sales charge or contingent deferred sales charge, if applicable. (3) This contractual expense decrease is reflected in both the expense and net investment income ratios. (4) Per share information is based on average shares outstanding. (5) Computed on an annualized basis. (6) Less than $0.01 per share. (See Notes which are an integral part of the Financial Statements) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The Wachovia Funds and The Wachovia Municipal Funds Financial Highlights--Class A Shares (For a share outstanding throughout each period)
Ratios to Average Net Assets --------------------------------------- Net Asset Net Net Assets, Portfolio Year Ended Value, end Total Investment Expense Waiver/ end of period Turnover November 30, of period Return(2) Expenses Income Reimbursement(3) (000 omitted) Rate - -------------------------------------------------------------------------------------------------- Wachovia Balanced Fund 1995 $11.92 26.32% 0.76% 3.58% 0.16% $207,421 102% 1996 $13.30 18.55% 0.76% 3.05% 0.24% $ 18,619 99% 1997 $13.26 15.17% 1.02% 2.77% 0.16% $ 50,968 143% 1998 $13.72 14.36% 1.01% 2.88% 0.09% $119,093 124% 1999 $13.45 13.95% 1.01% 2.26% 0.08% $205,167 66% Wachovia Fixed Income Fund 1995 $ 9.90 17.20% 0.74% 6.07% 0.10% $169,846 155% 1996 $ 9.83 5.51% 0.74% 6.05% 0.18% $ 4,853 181% 1997 $ 9.85 6.14% 0.98% 5.65% 0.11% $ 10,039 174% 1998 $10.14 8.65% 0.97% 5.30% 0.05% $ 24,624 111% 1999 $ 9.52 (0.77)% 0.97% 5.34% 0.03% $ 69,475 49% Wachovia Intermediate Fixed Income Fund 1995 $10.07 14.44% 1.10% 5.60% 0.41% $ 35,796 44% 1996 $ 9.96 4.46% 1.09% 5.62% 0.31% $ 43,277 84% 1997 $10.03 6.32% 1.04% 5.50% 0.30% $ 96,626 81% 1998 $10.38 9.39% 1.06% 5.39% 0.14% $ 4,759 57% 1999 $ 9.57 (1.03)% 0.99% 5.16% 0.04% $ 3,205 89% Wachovia Short-Term Fixed Income Fund 1995 $ 9.89 8.82% 0.63% 5.83% 0.18% $124,720 147% 1996 $ 9.79 5.29% 0.63% 5.50% 0.27% $ 1,675 145% 1997 $ 9.77 5.10% 0.87% 5.49% 0.19% $ 7,233 215% 1998 $ 9.92 6.93% 0.88% 5.22% 0.10% $ 10,437 135% 1999 $ 9.63 2.44% 0.88% 4.97% 0.14% $ 10,409 25% Wachovia Georgia Municipal Bond Fund 1995(1) $10.96 13.93% 0.92%(5) 4.30%(5) 1.88%(5) $ 10,220 14% 1996 $11.00 4.97% 0.89% 4.40% 1.61% $ 7,531 14% 1997 $11.11 5.41% 1.14% 4.03% 1.11% $ 6,531 25% 1998 $11.38 6.35% 1.17% 3.72% 0.34% $ 6,900 14% 1999 $10.61 (2.83)% 1.07% 3.87% 0.30% $ 5,450 48% Wachovia North Carolina Municipal Bond Fund 1995(1) $10.99 14.40% 0.85%(5) 4.40%(5) 1.19%(5) $ 18,679 19% 1996 $11.03 5.17% 0.84% 4.24% 0.77% $ 13,752 7% 1997 $11.15 5.36% 1.07% 3.91% 0.44% $ 11,563 17% 1998 $11.46 6.82% 1.10% 3.80% 0.16% $ 9,533 9% 1999 $10.72 (2.34)% 1.02% 3.73% 0.20% $ 8,644 11% Wachovia South Carolina Municipal Bond Fund 1995 $11.05 16.97% 0.58% 5.23% 0.55% $ 93,725 15% 1996 $11.05 5.54% 0.57% 5.10% 0.59% $ 65,981 20% 1997 $11.12 6.01% 0.81% 4.79% 0.48% $ 64,696 12% 1998 $11.36 6.88% 0.83% 4.52% 0.36% $ 67,458 6% 1999 $10.57 (2.49)% 0.83% 4.50% 0.35% $ 59,655 9% Wachovia Virginia Municipal Bond Fund 1995 $10.25 13.79% 1.05% 4.33% 0.46% $ 54,041 78% 1996 $10.15 3.50% 1.04% 4.45% 0.40% $ 70,378 37% 1997 $10.30 5.97% 0.96% 4.50% 0.40% $111,160 15% 1998 $10.49 6.76% 0.95% 4.35% 0.33% $ 8,835 15% 1999 $ 9.84 (2.01)% 0.90% 4.36% 0.29% $ 7,682 29%
(1) Reflects operations for the period from December 26, 1994 (date of initial public investment) to November 30, 1995. (2) Based on net asset value, which does not reflect the sales charge or contingent deferred sales charge, if applicable. (3) This contractual expense decrease is reflected in both the expense and net investment income ratios. (4) Per share information is based on average shares outstanding. (5) Computed on an annualized basis. (See Notes which are an integral part of the Financial Statements) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The Wachovia Funds and The Wachovia Municipal Funds Financial Highlights--Class B Shares (For a share outstanding throughout The period)
Net Realized and Distributions Unrealized Gain/ from Net Net Asset (Loss) on Total Distributions Realized Gain Value, Net Investment from from Net on Investment Year Ended beginning Investment and Futures Investment Investment Transaction and Total November 30, of period Income/(Loss) Contracts Operations Income Futures Contracts Distributions - --------------------------------------------------------------------------------------------------------------- Wachovia Equity Fund 1996(1) $12.43 0.02 2.37 2.39 (0.03) -- (0.03) 1997 $14.79 0.04 2.42 2.46 (0.04) (1.86) (1.90) 1998 $15.35 0.03 2.20 2.23 (0.03) (1.68) (1.71) 1999 $15.87 (0.04) 3.38 3.34 (0.00)(3) (1.89) (1.89) Wachovia Quantitative Equity Fund 1996(1) $13.09 0.04 2.56 2.60 (0.04) -- (0.04) 1997 $15.65 0.08 4.10 4.18 (0.09) (0.79) (0.88) 1998 $18.95 0.05 3.04 3.09 (0.06) (1.75) (1.81) 1999 $20.23 (0.05) 3.16 3.11 (0.01) (2.42) (2.43) Wachovia Special Values Fund 1999(5) $14.60 0.17 1.22 1.39 -- -- -- Wachovia Balanced Fund 1996(1) $11.68 0.09 1.59 1.68 (0.07) -- (0.07) 1997 $13.29 0.26 1.38 1.64 (0.26) (1.44) (1.70) 1998 $13.23 0.28 1.37 1.65 (0.29) (0.90) (1.19) 1999 $13.69 0.20 1.42 1.62 (0.21) (1.69) (1.90) Wachovia Fixed Income Fund 1996(1) $ 9.45 0.15 0.40 0.55 (0.17) -- (0.17) 1997 $ 9.83 0.48 0.01 0.49 (0.48) -- (0.48) 1998 $ 9.84 0.47 0.30 0.77 (0.47) -- (0.47) 1999 $10.14 0.43 (0.58) (0.15) (0.43) (0.04) (0.47)
(1) Reflects operations for the period from July 22, 1996 (date of initial public investment) to November 30, 1996. (2) Based on net asset value, which does not reflect the sales charge or contingent deferred sales charge, if applicable. (3) Less than $0.01 per share. (4) Computed on an annualized basis. (5) Reflects operations for the period from March 26, 1999 (date of initial public investment) to November 30, 1999. (6) This contractual expense decrease is reflected in both the expense and net investment income ratios. (See Notes which are an integral part of the Financial Statements) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The Wachovia Funds and The Wachovia Municipal Funds Financial Highlights--Class B Shares (For a share outstanding throughout the period)
Ratios to Average Net Assets ----------------------------------------- Net Asset Net Expense Net Assets, Portfolio Year Ended Value, end Total Investment Waiver/ end of period Turnover November 30, of period Return(2) Expenses Income/(Loss) Reimbursement(6) (000 omitted) Rate - ---------------------------------------------------------------------------------------------------- Wachovia Equity Fund 1996(1) $14.79 19.25% 1.90%(4) 0.02%(4) 0.20%(4) $ 976 64% 1997 $15.35 19.27% 1.90% 0.18% 0.06% $ 3,448 124% 1998 $15.87 16.52% 1.87% 0.17% -- $ 5,725 150% 1999 $17.32 23.37% 1.84% (0.26)% -- $ 8,992 45% Wachovia Quantitative Equity Fund 1996(1) $15.65 19.90% 1.87%(4) 0.46%(4) 0.11%(4) $ 1,414 44% 1997 $18.95 28.33% 1.85% 0.31% 0.07% $ 6,564 74% 1998 $20.23 18.15% 1.86% 0.20% -- $19,532 38% 1999 $20.91 15.85% 1.86% (0.27)% -- $24,652 34% Wachovia Special Values Fund 1999(5) $15.99 9.52% 1.98%(4) 0.93%(4) 0.01%(4) $ 350 44% Wachovia Balanced Fund 1996(1) $13.29 14.47% 1.76%(4) 1.93%(4) 0.16%(4) $ 1,821 99% 1997 $13.23 14.19% 1.78% 2.01% 0.16% $ 5,916 143% 1998 $13.69 13.56% 1.76% 2.13% 0.09% $13,963 124% 1999 $13.41 13.08% 1.76% 1.50% 0.08% $20,927 66% Wachovia Fixed Income Fund 1996(1) $ 9.83 5.83% 1.74%(4) 5.20%(4) 0.13%(4) $ 113 181% 1997 $ 9.84 5.21% 1.75% 4.89% 0.11% $ 140 174% 1998 $10.14 7.97% 1.72% 4.55% 0.05% $ 533 111% 1999 $ 9.52 (1.51)% 1.72% 4.57% 0.03% $ 819 49%
(1) Reflects operations for the period from July 22, 1996 (date of initial public investment) to November 30, 1996. (2) Based on net asset value, which does not reflect the sales charge or contingent deferred sales charge, if applicable. (3) Less than $0.01 per share. (4) Computed on an annualized basis. (5) Reflects operations for the period from March 26, 1999 (date of initial public investment) to November 30, 1999. (6) This contractual expense decrease is reflected in both the expense and net investment income ratios. (See Notes which are an integral part of the Financial Statements) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The Wachovia Funds and The Wachovia Municipal Funds Financial Highlights--Class Y Shares (For a share outstanding throughout each period)
Distributions Net Realized and from Net Net Asset Unrealized Gain/(Loss) on Distributions Realized Gain on Value Net Investments, Futures Total from from Net Investment Transactions, Year Ended beginning Investment Contracts, and Foreign Investment Investment Futures Contracts and November 30, of period Income Currency Transactions Operations Income Foreign Currency Transactions - ---------------------------------------------------------------------------------------------------------------------- Wachovia Equity Fund 1996(1) $12.43 0.03 2.40 2.43 (0.05) -- 1997 $14.81 0.17 2.43 2.60 (0.16) (1.86) 1998 $15.39 0.17 2.21 2.38 (0.17) (1.68) 1999 $15.92 0.12 3.38 3.50 (0.11) (1.89) Wachovia Quantitative Equity Fund 1996(1) $13.09 0.04 2.60 2.64 (0.06) -- 1997 $15.67 0.23 4.12 4.35 (0.23) (0.79) 1998 $19.00 0.23 3.06 3.29 (0.23) (1.75) 1999 $20.31 0.18 3.14 3.32 (0.17) (2.42) Wachovia Growth & Income Fund 1998(6) $22.31 0.09 1.24 1.33 (0.09) -- 1999 $23.55 0.12 4.24 4.36 (0.14) (2.89) Wachovia Equity Index Fund 1996(1) $13.37 0.09(5) 2.60 2.69 (0.08) -- 1997 $15.98 0.29 3.86 4.15 (0.31) (0.91) 1998 $18.91 0.30 3.92 4.22 (0.29) (0.40) 1999 $22.44 0.33 4.13 4.46 (0.32) (0.37) Wachovia Special Values Fund 1996(1) $13.62 0.03 2.02 2.05 -- -- 1997 $15.67 0.16 4.53 4.69 (0.08) (1.61) 1998 $18.67 0.21 (0.84) (0.63) (0.15) (1.71) 1999 $16.18 0.30 0.54 0.84 (0.20) (0.75) Wachovia Emerging Markets Fund 1996(1) $11.92 0.01(5) (0.26) (0.25) -- -- 1997 $11.67 0.07 (0.50) (0.43) (0.11) -- 1998 $11.13 0.13 (2.69) (2.56) (0.13) -- 1999 $ 8.44 0.04 3.34 3.38 (0.07) -- Wachovia Personal Equity Fund 1996(3) $10.00 0.02 0.67 0.69 (0.01) -- Wachovia Balanced Fund 1996(1) $11.68 0.08 1.63 1.71 (0.09) -- 1997 $13.30 0.38 1.39 1.77 (0.37) (1.44) 1998 $13.26 0.42 1.37 1.79 (0.41) (0.90) 1999 $13.74 0.32 1.44 1.76 (0.34) (1.69) Wachovia Fixed Income Fund 1996(1) $ 9.45 0.17 0.40 0.57 (0.19) -- 1997 $ 9.83 0.57 0.03 0.60 (0.58) -- 1998 $ 9.85 0.56 0.29 0.85 (0.56) -- 1999 $10.14 0.53 (0.58) (0.05) (0.53) (0.04) Wachovia Intermediate Fixed Income Fund 1998(6) $10.12 0.42 0.25 0.67 (0.41) -- 1999 $10.38 0.53 (0.61) (0.08) (0.53) (0.20) Wachovia Short-Term Fixed Income Fund 1996(1) $ 9.67 0.11(5) 0.18 0.29 (0.17) -- 1997 $ 9.79 0.56 (0.05) 0.51 (0.53) -- 1998 $ 9.77 0.54 0.14 0.68 (0.53) -- 1999 $ 9.92 0.51 (0.25) 0.26 (0.55) -- Wachovia Georgia Municipal Bond Fund 1996(1) $10.71 0.17 0.29 0.46 (0.17) -- 1997 $11.00 0.47 0.13 0.60 (0.47) (0.02) 1998 $11.11 0.45 0.27 0.72 (0.45) (0.00)(7) 1999 $11.38 0.45 (0.74) (0.29) (0.45) (0.03) Wachovia North Carolina Municipal Bond Fund 1996(1) $10.71 0.16 0.32 0.48 (0.16) -- 1997 $11.03 0.46 0.13 0.59 (0.45) (0.02) 1998 $11.15 0.46 0.32 0.78 (0.46) (0.01) 1999 $11.46 0.45 (0.68) (0.23) (0.45) (0.06) Wachovia South Carolina Municipal Bond Fund 1996(1) $10.73 0.20 0.32 0.52 (0.20) -- 1997 $11.05 0.55 0.12 0.67 (0.55) (0.05) 1998 $11.12 0.54 0.24 0.78 (0.54) (0.00)(7) 1999 $11.36 0.52 (0.77) (0.25) (0.52) (0.02) Wachovia Virginia Municipal Bond Fund 1998(6) $10.34 0.32 0.15 0.47 (0.32) -- 1999 $10.49 0.47 (0.65) (0.18) (0.47) -- Year Ended Total November 30, Distributions - ---------------------------------------------------------------------------------------------------------------------- Wachovia Equity Fund 1996(1) (0.05) 1997 (2.02) 1998 (1.85) 1999 (2.00) Wachovia Quantitative Equity Fund 1996(1) (0.06) 1997 (1.02) 1998 (1.98) 1999 (2.59) Wachovia Growth & Income Fund 1998(6) (0.09) 1999 (3.03) Wachovia Equity Index Fund 1996(1) (0.08) 1997 (1.22) 1998 (0.69) 1999 (0.69) Wachovia Special Values Fund 1996(1) -- 1997 (1.69) 1998 (1.86) 1999 (0.95) Wachovia Emerging Markets Fund 1996(1) -- 1997 (0.11) 1998 (0.13) 1999 (0.07) Wachovia Personal Equity Fund 1996(3) (0.01) Wachovia Balanced Fund 1996(1) (0.09) 1997 (1.81) 1998 (1.31) 1999 (2.03) Wachovia Fixed Income Fund 1996(1) (0.19) 1997 (0.58) 1998 (0.56) 1999 (0.57) Wachovia Intermediate Fixed Income Fund 1998(6) (0.41) 1999 (0.73) Wachovia Short-Term Fixed Income Fund 1996(1) (0.17) 1997 (0.53) 1998 (0.53) 1999 (0.55) Wachovia Georgia Municipal Bond Fund 1996(1) (0.17) 1997 (0.49) 1998 (0.45) 1999 (0.48) Wachovia North Carolina Municipal Bond Fund 1996(1) (0.16) 1997 (0.47) 1998 (0.47) 1999 (0.51) Wachovia South Carolina Municipal Bond Fund 1996(1) (0.20) 1997 (0.60) 1998 (0.54) 1999 (0.54) Wachovia Virginia Municipal Bond Fund 1998(6) (0.32) 1999 (0.47)
(1) Reflects operations for the period from July 22, 1996 (date of initial public investment) to November 30, 1996. (2) Based on net asset value, which does not reflect the sales charge or contingent deferred sales charge, if applicable. (3) Reflects operations for the period from July 30, 1999 (date of initial public investment) to November 30, 1999. (4) Computed on an annualized basis. (5) Per share information is based on average shares outstanding. (6) Reflects operations for the period from March 30, 1998 (date of initial public investment) to November 30, 1998. (7) Less than $0.01 per share. (8) This contractual expense decrease is reflected in both the expense and net investment income ratios. (9) Less than 0.01%. (See Notes which are an integral part of the Financial Statements) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The Wachovia Funds and The Wachovia Municipal Funds Financial Highlights--Class Y Shares (For a share outstanding throughout each period)
Ratios to Average Net Assets --------------------------------------- Net Asset Net Net Assets, Portfolio Year Ended Value, end Total Investment Expense Waiver/ end of period Turnover November 30, of period Return(2) Expenses Income Reimbursement(8) (000 omitted) Rate - --------------------------------------------------------------------------------------------------- Wachovia Equity Fund 1996(1) $14.81 19.57% 0.90%(4) 0.91%(4) 0.19%(4) $129,205 64% 1997 $15.39 20.44% 0.90% 1.18% 0.07% $156,238 124% 1998 $15.92 17.69% 0.90% 1.13% -- $200,324 150% 1999 $17.42 24.52% 0.84% 0.73% -- $223,878 45% Wachovia Quantitative Equity Fund 1996(1) $15.67 20.19% 0.87%(4) 1.19%(4) 0.11(4) $152,571 44% 1997 $19.00 29.60% 0.87% 1.35% 0.08% $183,019 74% 1998 $20.31 19.38% 0.87% 1.21% -- $207,343 38% 1999 $21.04 16.97% 0.86% 0.67% -- $598,420 34% Wachovia Growth & Income Fund 1998(6) $23.55 6.03% 0.86%(4) 0.90%(4) 0.08%(4) $206,176 24% 1999 $24.88 20.73% 0.84% 0.49% -- $254,919 44% Wachovia Equity Index Fund 1996(1) $15.98 20.14% 0.48%(4) 1.92%(4) 0.06%(4) $213,833 12% 1997 $18.91 27.91% 0.47% 1.72% 0.02% $248,030 4% 1998 $22.44 23.05% 0.45% 1.46% -- $291,708 29% 1999 $26.21 20.24% 0.44% 1.32% -- $361,934 11% Wachovia Special Values Fund 1996(1) $15.67 15.05% 1.15%(4) 1.76%(4) 0.24%(4) $ 58,697 38% 1997 $18.67 33.29% 1.11% 0.88% 0.02% $ 84,501 46% 1998 $16.18 (3.59%) 1.00% 1.26% -- $ 90,550 20% 1999 $16.07 5.61% 0.98% 1.85% 0.00%(9) $109,969 44% Wachovia Emerging Markets Fund 1996(1) $11.67 0.00% 0.63%(4) 0.45%(4) 0.13%(4) $123,036 30% 1997 $11.13 (3.73%) 1.54% 0.54% -- $139,700 60% 1998 $ 8.44 (23.34%) 1.44% 1.04% -- $130,898 51% 1999 $11.75 40.39% 1.35% 0.61% -- $178,443 56% Wachovia Personal Equity Fund 1999(3) $10.68 6.85% 0.90%(4) 0.33%(4) 0.01%(4) $444,453 11% Wachovia Balanced Fund 1996(1) $13.30 14.69% 0.76%(4) 2.85%(4) 0.16%(4) $235,791 99% 1997 $13.26 15.37% 0.77% 3.02% 0.16% $250,083 143% 1998 $13.74 14.77% 0.76% 3.15% 0.09% $290,833 124% 1999 $13.47 14.21% 0.76% 2.50% 0.08% $424,506 66% Wachovia Fixed Income Fund 1996(1) $ 9.83 6.12% 0.75%(4) 6.33%(4) 0.14%(4) $175,836 181% 1997 $ 9.85 6.38% 0.74% 5.91% 0.11% $185,398 174% 1998 $10.14 8.92% 0.72% 5.55% 0.05% $212,886 111% 1999 $ 9.52 (0.53%) 0.72% 5.65% 0.03% $487,982 49% Wachovia Intermediate Fixed Income Fund 1998(6) $10.38 7.11% 0.74%(4) 5.39%(4) 0.14%(4) $ 87,831 57% 1999 $ 9.57 (0.77%) 0.74% 5.46% 0.04% $138,508 89% Wachovia Short-Term Fixed Income Fund 1996(1) $ 9.79 3.00% 0.64%(4) 5.77%(4) 0.19%(4) $116,138 145% 1997 $ 9.77 5.33% 0.63% 5.63% 0.20% $ 91,063 215% 1998 $ 9.92 7.19% 0.63% 5.47% 0.10% $ 98,433 135% 1999 $ 9.63 2.70% 0.63% 5.26% 0.14% $ 38,323 25% Wachovia Georgia Municipal Bond Fund 1996(1) $11.00 4.31% 0.89%(4) 4.84%(4) 1.57%(4) $ 6,803 14% 1997 $11.11 5.63% 0.92% 4.24% 1.06% $ 12,308 25% 1998 $11.38 6.62% 0.91% 3.96% 0.34% $ 17,030 14% 1999 $10.61 (2.59%) 0.68% 4.46% 0.37% $108,755 48% Wachovia North Carolina Municipal Bond Fund 1996(1) $11.03 4.55% 0.84%(4) 4.16%(4) 0.65%(4) $ 28,283 7% 1997 $11.15 5.57% 0.85% 4.16% 0.42% $ 44,104 17% 1998 $11.46 7.09% 0.85% 4.05% 0.16% $ 56,760 9% 1999 $10.72 (2.09%) 0.66% 4.27% 0.30% $434,523 11% Wachovia South Carolina Municipal Bond Fund 1996(1) $11.05 4.86% 0.57%(4) 5.56%(4) 0.54%(4) $ 36,511 20% 1997 $11.12 6.23% 0.58% 5.01% 0.48% $ 43,881 12% 1998 $11.36 7.15% 0.58% 4.77% 0.36% $ 54,770 6% 1999 $10.57 (2.24%) 0.58% 4.85% 0.35% $288,800 9% Wachovia Virginia Municipal Bond Fund 1998(6) $10.49 4.61% 0.68%(4) 4.62%(4) 0.33%(4) $ 99,154 15% 1999 $ 9.84 (1.76%) 0.65% 4.64% 0.29% $129,811 29%
(1) Reflects operations for the period from July 22, 1996 (date of initial public investment) to November 30, 1996. (2) Based on net asset value, which does not reflect the sales charge or contingent deferred sales charge, if applicable. (3) Reflects operations for the period from July 30, 1999 (date of initial public investment) to November 30, 1999. (4) Computed on an annualized basis. (5) Per share information is based on average shares outstanding. (6) Reflects operations for the period from March 30, 1998 (date of initial public investment) to November 30, 1998. (7) Less than $0.01 per share. (8) This contractual expense decrease is reflected in both the expense and net investment income ratios. (9) Less than 0.01%. (See Notes which are an integral part of the Financial Statements) - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- The Wachovia Funds The Wachovia Municipal Funds Combined Notes to Financial Statements November 30, 1999 1. Organization The Wachovia Funds and The Wachovia Municipal Funds (individually referred to as the "Trust" or collectively as the "Trusts") are registered under the Investment Company Act of 1940, as amended (the "Act") as open-end management investment companies. The Trusts consist of nineteen portfolios. The financial statements of the following portfolios (individually referred to as the "Fund" or collectively as the "Funds") are presented herein: The Wachovia Funds* Portfolio Investment Objective --------- -------------------- Wachovia Equity Fund ("Equity Fund") To produce growth of principal and income. Wachovia Quantitative Equity Fund To provide growth of principal and ("Quantitative Equity Fund") income. Wachovia Growth & Income Fund To provide total return through ("Growth & Income Fund") growth of capital and current income. Wachovia Equity Index Fund To provide a total return that ("Equity Index Fund") approximates that of the stock market as measured by the S&P 500 Index. Wachovia Special Values Fund To produce growth of principal. ("Special Values Fund") Wachovia Emerging Markets Fund To produce long-term capital ("Emerging Markets Fund") appreciation. Wachovia Personal Equity Fund To produce growth of principal and ("Personal Equity Fund") income. Wachovia Balanced Fund To provide long-term growth of ("Balanced Fund") principal and current income. Wachovia Fixed Income Fund To seek a high level of total ("Fixed Income Fund") return. Wachovia Intermediate Fixed Income Fund To seek current income consistent ("Intermediate Fixed Income Fund") with preservation of capital. Wachovia Short-Term Fixed Income Fund To produce a high level of current ("Short-Term Fixed Income Fund") income. The Wachovia Municipal Funds Portfolio Investment Objective --------- -------------------- Wachovia Georgia Municipal Bond Fund To provide current income which is ("Georgia Municipal Bond Fund")** exempt from federal regular income tax and the income taxes imposed by the State of Georgia. Wachovia North Carolina Municipal Bond To provide current income which is Fund exempt from federal regular income ("North Carolina Municipal Bond tax and the income taxes imposed Fund")** by the State of North Carolina. Wachovia South Carolina Municipal Bond To provide current income which is Fund exempt from federal regular income ("South Carolina Municipal Bond Fund")** tax and South Carolina state income taxes. Wachovia Virginia Municipal Bond Fund To provide a high level of current ("Virginia Municipal Bond Fund")** income that is exempt from federal regular income tax and the income tax imposed by the Commonwealth of Virginia as is consistent with the preservation of capital.
* In addition, The Wachovia Funds offer the following money market portfolios, each having distinctive investment objectives and policies: Wachovia Money Market Fund, Wachovia Prime Cash Management Fund, Wachovia Tax-Free Money Market Fund, and Wachovia U.S. Treasury Money Market Fund. The financial statements of the money market portfolios are presented separately. ** Non-diversified portfolio. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- The Wachovia Funds The Wachovia Municipal Funds The assets of each portfolio are segregated and a shareholder's interest is limited to the portfolio in which shares are held. Effective March 30, 1998, the following events affected the organization of the Trusts. The Growth & Income Fund, the Intermediate Fixed Income Fund, and the Virginia Municipal Bond Fund converted into Class A Shares of the Trusts from the MarketWatch Funds. The Equity Fund, formerly a portfolio of the MarketWatch Funds, changed its name to the Growth & Income Fund upon conversion. The Growth & Income Fund, the Intermediate Fixed Income Fund, and the Virginia Municipal Bond Fund added a second class of shares, Class Y Shares. Class A Shares resulting from the conversion of the MarketWatch Funds, were exchanged into Class Y Shares. On July 30, 1999, the following Funds received a tax-free transfer of assets from the Wachovia Common Trust Funds.
Common Fund Trust Fund Unrealized Shares Net Assets Appreciation/ Issued Received (Depreciation) (1) ---------- ------------ ------------------ Quantitative Equity Fund 18,308,897 $373,318,412 $210,964,004 Special Values Fund 368,577 6,217,889 740,648 Personal Equity Fund 42,839,470 428,394,696 163,566,983 Balanced Fund 19,580,102 249,842,105 32,051,587 Fixed Income Fund 27,808,700 265,851,176 (7,410,780) Intermediate Fixed Income Fund 6,139,436 59,122,769 101,597 Short-Term Fixed Income Fund 737,496 7,116,836 12,696 Georgia Municipal Bond Fund 8,083,520 88,191,199 1,136,482 North Carolina Municipal Bond Fund 33,367,726 366,043,958 6,254,172 South Carolina Municipal Bond Fund 20,754,532 225,809,305 5,863,930 Virginia Municipal Bond Fund 3,242,961 32,818,769 (57,431)
(1) Unrealized appreciation/(depreciation) is included in the Common Trust Fund net assets acquired above. 2. Significant Accounting Policies The following is a summary of significant accounting policies consistently followed by the Funds in the preparation of their financial statements. These policies are in conformity with generally accepted accounting principles. Investment Valuations--Municipal bonds are valued by an independent pricing service, taking into consideration yield, liquidity, risk, credit quality, coupon, maturity, type of issue, and any other factors or market data the pricing service deems relevant. U.S. government securities, listed corporate bonds, other fixed income and asset-backed securities, unlisted securities and private placement securities are generally valued at the latest bid prices as furnished by an independent pricing service. Listed equity securities and investments in closed-end investment companies are valued at the last sale price reported on a national securities exchange. Short-term securities are valued at the prices provided by an independent pricing service. However, short-term securities with remaining maturities of sixty days or less at the time of purchase may be valued at amortized cost, which approximates fair market value. Investments in other open-end regulated investment companies are valued at net asset value. With respect to valuation of foreign securities, trading in foreign cities may be completed at times which vary from the closing of the New York Stock Exchange. Therefore, foreign securities are valued at the latest closing price on the exchange on which they are traded prior to the closing of the New York Stock Exchange. Foreign securities quoted in foreign currencies are translated into US dollars at the foreign exchange rate in effect at noon, eastern time, on the day the value of the foreign security is determined. Repurchase Agreements--It is the policy of the Funds to require the custodian bank to take possession, to have legally segregated in the Federal Reserve Book Entry System, or to have segregated within the custodian bank's vault, all securities held as collateral under repurchase agreement transactions. Additionally, procedures have been established by the Funds to monitor, on a daily basis, the market value of each repurchase agreement's collateral to ensure that the value of collateral at least equals the repurchase price to be paid under the repurchase agreement transaction. The Funds will only enter into repurchase agreements with banks and other recognized financial institutions, such as broker/dealers, which are deemed by the Funds' adviser to be creditworthy pursuant to the guidelines and/or standards reviewed or established by the Boards of Trustees (the "Trustees"). Risks may arise from the potential inability of counterparties to honor the terms of the repurchase agreement. Accordingly, the Funds could receive less than the repurchase price on the sale of collateral securities. Investment Income, Expenses and Distributions--Interest income and expenses are accrued daily. Bond premium and discount, if applicable, are amortized as required by the Internal Revenue Code, as amended (the "Code"). Dividend income and distributions to shareholders are recorded on the ex-dividend date. Certain dividends from foreign securities may be recorded after the ex-dividend date based upon when the Fund is reasonably able to obtain information. Non-cash dividends included in dividend income, if any, are recorded at fair value. The Trusts offer multiple classes of shares, which differ in their respective distribution and service fees. All shareholders bear the common expenses of the Fund based on average daily net assets of each class, without distinction between share classes. Dividends are declared separately for each class. No class has preferential dividend rights; differences in per share dividend rates are generally due to differences in separate class expenses. Federal Taxes--It is the Funds' policy to comply with the provisions of the Code applicable to regulated investment companies and to distribute to shareholders each year substantially all of their income. Accordingly, no provision for federal tax is necessary. Withholding taxes on foreign interest, dividends and capital gains in the Emerging Markets Fund have been provided for in accordance with the applicable country's tax rules and rates. At November 30, 1999, the Funds listed below, for federal tax purposes, had capital loss carryforwards, as noted, which will reduce each Fund's taxable income arising from future net realized gain on investments, if any, to the extent permitted by the Code, and thus will reduce the amount of the distributions to shareholders which would otherwise be necessary to relieve the Funds of any liability for federal tax.
Total Amount Amount Amount Amount Amount Amount Tax Loss Expiring Expiring Expiring Expiring Expiring Expiring Fund Carryforward In 2002 In 2003 In 2004 In 2005 In 2006 In 2007 ---- ------------ ---------- -------- -------- -------- ----------- ---------- Emerging Markets Fund $26,221,931 $ -- $ -- $ -- $939,725 $25,282,206 $ -- Fixed Income Fund 2,177,586 -- -- -- -- -- 2,177,586 Short-Term Fixed Income Fund 3,064,915 2,260,880 250,580 467,184 86,271 -- -- Georgia Municipal Bond Fund 575,481 -- -- -- -- -- 575,481 Virginia Municipal Bond Fund 1,435,169 950,642 -- 484,527 -- -- --
When-Issued and Delayed Delivery Transactions--The Funds may engage in when-issued or delayed delivery transactions. The Funds record when-issued securities on the trade date and maintain security positions such that sufficient liquid assets will be available to make payment for the securities purchased. Securities purchased on a when-issued or delayed delivery basis are marked to market daily and begin earning interest on the settlement date. Losses may occur on these transactions due to changes in market conditions or the failure of counterparties to perform under the contract. Futures Contracts--The Funds listed below purchased stock index or bond futures contracts to manage cashflows, enhance yield, and to potentially reduce transaction costs. Upon entering into a futures contract with a broker, the Funds listed below are required to deposit in a segregated account a specified amount of cash or U.S. government securities. Futures contracts are valued daily and unrealized gains or losses are recorded in a "variation margin" account. Daily, the Funds receive from or pay to the broker a specified amount of cash based upon changes in the variation margin account. When a contract is closed, the Funds recognize a realized gain or loss. For the period ended November 30, 1999, the following Funds had realized gains/losses on futures contracts as follows:
Realized Gain (Loss) Fund on Futures Contracts ---- --------------------- Equity Fund $10,856,267 Quantitative Fund 8,641,991 Growth & Income Fund 4,553,978 Equity Index Fund 13,483,203 Special Values Fund 2,674,490 Personal Equity Fund (439,279) Balanced Fund 7,746,562 Fixed Income Fund 615,573 Intermediate Fixed Income Fund 150,517
Futures contracts have market risks, including the risk that the change in the value of the contract may not correlate with changes in the value of the underlying securities. At November 30, 1999, the Funds had outstanding futures contracts as set forth below: Equity Fund
Contract to Unrealized Expiration Date Deliver/Receive Position Appreciation --------------- --------------- -------- ------------ December 1999 154 S&P 500 Index Futures Long $ 873,393
Quantitative Equity Fund
Contract to Unrealized Expiration Date Deliver/Receive Position Appreciation --------------- --------------- -------- ------------ December 1999 45 S&P 500 Index Futures Long $ 872,449
Growth & Income Fund
Contract to Unrealized Expiration Date Deliver/Receive Position Appreciation --------------- --------------- -------- ------------ December 1999 61 S&P 500 Index Futures Long $ 293,212
Equity Index Fund
Contract to Unrealized Expiration Date Deliver/Receive Position Appreciation --------------- --------------- -------- ------------ December 1999 177 S&P 500 Index Futures Long $ 868,884
Special Values FUND
Contract to Unrealized Expiration Date Deliver/Receive Position Appreciation --------------- ------------------------------- -------- ------------ December 1999 50 S&P Midcap 400 Index Futures Long $ 165,100
Personal Equity Fund
Contract to Unrealized Expiration Date Deliver/Receive Position Appreciation --------------- --------------- -------- ------------ December 1999 73 S&P 500 Index Futures Long $ 207,541
Balanced Fund
Unrealized Contract to Appreciation/ Expiration Date Deliver/Receive Position (Depreciation) --------------- --------------- -------- -------------- December 1999 39 5-Year U.S. Treasury Notes Futures Long $ (33,203) December 1999 30 U.S. Treasury Bonds Futures Short 77,552 December 1999 17 10-Year U.S. Treasury Notes Futures Short (14,262) --------- $ 30,087
Fixed Income Fund
Unrealized Contract to Appreciation/ Expiration Date Deliver/Receive Position (Depreciation) --------------- --------------- -------- -------------- December 1999 40 CAN Gov't Bonds Futures Long $(110,129) December 1999 19 5-Year U.S. Treasury Notes Futures Long (17,334) December 1999 150 U.S. Treasury Bonds Futures Long (201,054) December 1999 50 2-Year U.S. Treasury Notes Futures Short 56,491 December 1999 129 5-Year U.S. Treasury Notes Futures Short 138,214 --------- $(133,812)
Intermediate Fixed Income Fund
Contract to Unrealized Expiration Date Deliver/Receive Position Appreciation --------------- --------------- -------- ------------ December 1999 20 5-Year U.S. Treasury Notes Futures Short $ 16,875 December 1999 17 U.S. Treasury Long Bond Futures Short 29,086 --------- $ 45,961
Foreign Exchange Contracts--Emerging Markets Fund may enter into foreign currency exchange contracts as a way of managing foreign exchange rate risk. The Fund may enter into these contracts for the purchase or sale of a specific foreign currency at a fixed price on a future date as a hedge or cross hedge against either specific transactions or portfolio positions. The objective of the Fund's foreign currency hedging transactions is to reduce the risk that the U.S. dollar value of the Fund's foreign currency denominated securities will decline in value due to changes in foreign currency exchange rates. All foreign currency exchange contracts are "marked to market" daily at the applicable translation rates resulting in unrealized gains or losses. Realized gains or losses are recorded at the time the foreign currency exchange contract is offset by entering into a closing transaction or by the delivery or receipt of the currency. Risk may arise upon entering into these contracts from the potential inability of counterparties to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. At November 30, 1999, Emerging Markets Fund had no outstanding foreign currency contracts. Foreign Currency Translation--The accounting records of Emerging Markets Fund are maintained in U.S. dollars. All assets and liabilities denominated in foreign currencies ("FC") are translated into U.S. dollars based on the rate of exchange of such currencies against U.S. dollars on the date of valuation. Purchases and sales of securities, income and expenses are translated at the rate of exchange quoted on the respective date that such transactions are recorded. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss from investments. Reported net realized foreign exchange gains or losses arise from sales of portfolio securities, sales and maturities of short-term securities, sales of FCs, currency gains or losses realized between the trade and settlement dates on securities transactions, the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund's books, and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in the value of assets and liabilities other than investments in securities at fiscal year end, resulting from changes in the exchange rate. Reclassification--In accordance with Statement of Position 93-2 Determination, Disclosure, and Financial Statement Presentation of Income, Capital Gain, and Return of Capital by Investment Companies ("SOP 93-2"), permanent book and tax differences have been reclassified to paid-in- capital. These differences are primarily due to differing treatments for foreign currency transactions, market discount and paydowns on certain debt instruments. Amounts for the Funds, as of November 30, 1999, have been reclassified to reflect the following:
Increase (Decrease) ---------------------------------------------------------------------------- Undistributed Net Investment Accumulated Income/Accumulated Paid-In Net Realized Distributions in Excess of Fund Name Capital Gain/Loss Net Investment Income --------- ------- ------------ ---------------------------- Equity Fund (131) 158 (27) Emerging Market Fund 31,679 (697,568) 665,889 Balanced Fund 852 (851) (1) Fixed Income Fund (1) 19,649 (19,648) North Carolina Municipal Bond Fund (42,405) (5,936) 48,341
Restricted Securities--Restricted securities are securities that may only be resold upon registration under federal securities laws or in transactions exempt from such registration. Many restricted securities may be resold in the secondary market in transactions exempt from registration. Such restricted securities may be determined to be liquid under criteria established by the Trustees. The Fund will not incur any registration costs upon such resales. The Fund's restricted securities are valued at the price provided by dealers in the secondary market or, if no market prices are available, at the fair value as determined by the Funds' pricing committee. 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 amounts of assets, liabilities, expenses and revenues reported in the financial statements. Actual results could differ from those estimated. Other--Investment transactions are accounted for on a trade date basis. 3. Shares of Beneficial Interest The Declaration of Trust of both The Wachovia Funds and The Wachovia Municipal Funds permits the Trustees to issue an unlimited number of full and fractional shares of beneficial interest (without par value). Transactions in shares were as follows:
Equity Fund Quantitative Equity Fund ---------------------------------------------- ----------------------------------------------- Year Ended Year Ended November 30, November 30, 1999 1998 1999 1998 Class A Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars - -------------------------------------------------------------------------------------------------------------------------- Shares sold 4,052,281 $63,873,580 924,716 $13,703,327 953,578 $19,776,828 2,588,389 $48,886,094 Shares issued to shareholders in payment of distributions declared 461,898 6,725,775 353,528 4,797,366 485,602 10,032,446 222,235 3,819,153 Shares redeemed (1,021,992) (16,434,402) (506,801) (7,457,571) (1,269,823) (26,574,214) (599,567) (11,284,446) ---------- ----------- -------- ----------- ---------- ----------- --------- ----------- Net change resulting from Class A Shares transactions 3,492,187 $54,164,953 771,443 $11,043,122 169,357 $ 3,235,060 2,211,057 $41,420,801 ---------- ----------- -------- ----------- ---------- ----------- --------- -----------
Equity Fund continued Quantitative Equity Fund continued ---------------------------------------------------- ------------------------------------------------- Year Ended Year Ended November 30, November 30, 1999 1998 1999 1998 Class B Shares Dollars Shares Dollars Shares Dollars Shares Dollars - --------------------------------------------------------------------------------------------------------------------------- Shares sold 143,892 $ 2,281,670 139,205 $ 2,092,971 210,364 $ 4,363,910 633,822 $12,088,957 Shares issued to shareholders in payment of distributions declared 46,508 673,905 29,176 393,654 122,061 2,518,535 39,020 665,947 Shares redeemed (32,015) (512,884) (32,270) (471,352) (118,994) (2,474,854) (53,666) (995,247) ---------- ------------ ----------- ------------- ---------- ------------ ---------- ----------- Net change resulting from Class B Shares transactions 158,385 $ 2,442,691 136,111 $ 2,015,273 213,431 $ 4,407,591 619,176 $11,759,657 ---------- ------------ ----------- ------------- ---------- ------------ ---------- ----------- Year Ended Year Ended November 30, November 30, 1999 1998 1999 1998 Class Y Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars - --------------------------------------------------------------------------------------------------------------------------- Shares sold 3,776,292 $ 60,058,148 4,380,401 $ 64,007,995 1,025,164 $ 21,075,310 1,326,703 $24,567,733 Shares issued in connection with the tax-free exchange of assets from a Common Trust Fund -- -- -- -- 18,308,897 373,318,412 -- -- Shares issued to shareholders in payment of distributions declared 1,183,674 17,218,904 1,000,056 13,577,140 1,137,268 23,539,620 1,014,452 17,399,559 Shares redeemed (4,695,161) (73,803,563) (2,944,530) (43,863,733) (2,241,018) (46,184,830) (1,761,030) (32,169,312) ---------- ------------ ----------- ------------- ---------- ------------ ---------- ----------- Net change resulting from Class Y Shares transactions 264,805 $ 3,473,489 2,435,927 $ 33,721,402 18,230,311 $371,748,512 580,125 $ 9,797,980 ---------- ------------ ----------- ------------- ---------- ------------ ---------- ----------- Net change resulting from fund shares transactions 3,915,377 $ 60,081,133 3,343,481 $ 46,779,797 18,613,098 $379,391,163 3,410,358 $62,978,438 ---------- ------------ ----------- ------------- ---------- ------------ ---------- ----------- Growth & Income Fund ---------------------------------------------------- Year Ended November 30, 1999 1998 Class A Shares Shares Dollars Shares Dollars - -------------------------------------------------------------------------------- Shares sold 281,205 $ 6,454,877 500,103 $ 10,555,907 Shares issued to shareholders in payment of distributions declared 755,024 16,039,988 484,959 9,614,799 Exchange into Class Y shares -- -- (9,553,829) (213,145,727) Shares redeemed (2,764,933) (66,276,113) (2,336,814) (48,594,932) ---------- ------------ ----------- ------------- Net change resulting from Class A Shares transactions (1,728,704) $(43,781,248) (10,905,581) $(241,569,953) ---------- ------------ ----------- -------------
Growth & Income Fund continued ------------------------------------------------- Period Ended November 30, 1999 1998 (1) Class Y Shares Shares Dollars Shares Dollars - -------------------------------------------------------------------------------- Shares sold 3,064,027 $72,849,243 215,719 $ 4,785,076 Exchange from Class A shares -- -- 9,553,829 213,145,727 Shares issued to shareholders in payment of distributions declared 201,549 4,288,610 7,342 153,661 Shares redeemed (1,776,432) (40,947,570) (1,021,427) (22,575,885) ---------- ----------- ---------- ------------ Net change resulting from Class Y Shares transactions 1,489,144 $36,190,283 8,755,463 $195,508,579 ---------- ----------- ---------- ------------ Net change resulting from fund shares transactions (239,560) $(7,590,965) (2,150,118) $(46,061,374) ---------- ----------- ---------- ------------ Equity Index Fund Special Values Fund ------------------------------------------------- ------------------------------------------------ Year Ended Year Ended November 30, November 30, 1999 1998 1999 1998 Class A Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars - ------------------------------------------------------------------------------------------------------------------------ Shares sold 2,433,185 $59,425,268 3,701,907 $ 76,535,465 1,648,997 $25,747,530 2,610,113 $45,663,955 Shares issued to shareholders in payment of distributions declared 161,487 3,783,553 109,762 2,088,409 221,638 3,320,559 248,937 4,102,490 Shares redeemed (1,486,793) (36,669,214) (636,039) (13,107,910) (1,475,880) (23,294,839) (1,202,936) (19,509,112) ---------- ----------- ---------- ------------ ---------- ----------- ---------- ----------- Net change resulting from Class A Shares transactions 1,107,879 $26,539,607 3,175,630 $ 65,515,964 394,755 $ 5,773,250 1,656,114 $30,257,333 ---------- ----------- ---------- ------------ ---------- ----------- ---------- ----------- Year Ended Period Ended November 30, November 30, 1999 1998 1999(2) 1998 Class B Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars - ------------------------------------------------------------------------------------------------------------------------ Shares sold -- -- -- -- 22,330 $360,128 -- -- Shares redeemed -- -- -- -- (440) (7,001) -- -- ---------- ----------- ---------- ------------ ---------- ----------- ---------- ----------- Net change resulting from Class B Shares transactions -- -- -- -- 21,890 $353,127 -- -- ---------- ----------- ---------- ------------ ---------- ----------- ---------- -----------
(1) Reflects operations for the period from March 30, 1998 (date of initial public investment) to November 30, 1998. (2) Reflects operations for the period from March 26, 1999 (date of initial public investment) to November 30, 1999.
Equity Index Fund continued Special Values Fund continued -------------------------------------------------- ------------------------------------------------- Year Ended Year Ended November 30, November 30, 1999 1998 1999 1998 Class Y Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars - --------------------------------------------------------------------------------------------------------------------------- Shares sold 3,624,816 $ 89,366,742 2,854,402 $ 58,057,370 1,866,656 $ 29,627,043 1,475,771 $ 25,185,127 Shares issued in connection with the tax-free exchange of assets from a Common Trust Fund -- -- -- -- 368,577 6,217,889 -- -- Shares issued to shareholders in payment of distributions declared 359,520 8,442,713 454,689 8,624,862 269,815 4,041,990 422,376 6,964,972 Shares redeemed (3,174,724) (78,112,061) (3,418,715) (70,167,430) (1,259,252) (20,017,864) (827,147) (13,991,139) ---------- ------------ ---------- ------------ ---------- ------------ --------- ------------ Net change resulting from Class Y Shares transactions 809,612 $ 19,697,394 (109,624) $ (3,485,198) 1,245,796 $ 19,869,058 1,071,000 $ 18,158,960 ---------- ------------ ---------- ------------ ---------- ------------ --------- ------------ Net change resulting from fund shares transactions 1,917,491 $ 46,237,001 3,066,006 $ 62,030,766 1,662,441 $ 25,995,435 2,727,114 $ 48,416,293 ---------- ------------ ---------- ------------ ---------- ------------ --------- ------------ Emerging Markets Fund Personal Equity Fund -------------------------------------------------- ------------------------------------------------- Year Ended Period Ended November 30, November 30, 1999 1998 1999(1) 1998 Class A Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars - --------------------------------------------------------------------------------------------------------------------------- Shares sold 1,435,937 $ 13,700,861 692,384 $ 6,536,524 10,285 $ 108,394 -- -- Shares issued to shareholders in payment of distributions declared 5,838 48,574 7,323 79,306 -- -- -- -- Shares redeemed (1,107,036) (11,087,791) (389,449) (3,539,372) -- -- -- -- ---------- ------------ ---------- ------------ ---------- ------------ --------- ------------ Net change resulting from Class A Shares transactions 334,739 $ 2,661,644 310,258 $ 3,076,458 10,285 $ 108,394 -- -- ---------- ------------ ---------- ------------ ---------- ------------ --------- ------------ Year Ended Period Ended November 30, November 30, 1999 1998 1999(1) 1998 Class Y Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars - --------------------------------------------------------------------------------------------------------------------------- Shares sold 2,120,687 $ 21,432,137 5,272,409 $ 53,125,694 212,717 $ 2,135,793 -- -- Shares issued in connection with the tax-free exchange of assets from a Common Trust Fund -- -- -- -- 42,839,470 428,394,696 -- -- Shares issued to shareholders in payment of distributions declared 40,439 336,056 49,656 537,283 6 63 -- -- Shares redeemed (2,487,448) (24,885,093) (2,367,712) (21,683,002) (1,422,396) (14,516,568) -- -- ---------- ------------ ---------- ------------ ---------- ------------ --------- ------------ Net change resulting from Class Y Shares transactions (326,322) $ (3,116,900) 2,954,353 $ 31,979,975 41,629,797 $416,013,984 -- -- ---------- ------------ ---------- ------------ ---------- ------------ --------- ------------ Net change resulting from fund shares transactions 8,417 $ (455,254) 3,264,611 $ 35,056,433 41,640,082 $416,122,378 -- -- ---------- ------------ ---------- ------------ ---------- ------------ --------- ------------
(1) Reflects operations for the period from July 30, 1999 (date of initial public investment) to November 30, 1999.
Balanced Fund Fixed Income Fund -------------------------------------------------- ------------------------------------------------- Year Ended Year Ended November 30, November 30, 1999 1998 1999 1998 Class A Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars - -------------------------------------------------------------------------------------------------------------------------- Shares sold 13,302,993 $175,398,809 5,764,174 $75,056,038 5,871,429 $ 58,049,075 1,958,828 $19,573,923 Shares issued to shareholders in payment of distributions declared 1,655,692 21,296,221 490,771 6,104,654 303,232 2,942,729 89,113 890,891 Shares redeemed (8,386,327) (110,347,891) (1,421,643) (18,503,796) (1,305,306) (12,764,043) (638,391) (6,425,094) ----------- ------------ ---------- ----------- ---------- ------------ ---------- ----------- Net change resulting from Class A Shares transactions 6,572,358 $ 86,347,139 4,833,302 $62,656,896 4,869,355 $ 48,227,761 1,409,550 $14,039,720 ----------- ------------ ---------- ----------- ---------- ------------ ---------- ----------- Year Ended Year Ended November 30, November 30, 1999 1998 1999 1998 Class B Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars - -------------------------------------------------------------------------------------------------------------------------- Shares sold 482,978 $ 6,309,015 593,884 $ 7,769,427 34,614 $ 346,537 39,258 $ 390,310 Shares issued to shareholders in payment of distributions declared 168,767 2,160,724 50,089 621,444 2,744 26,754 1,271 12,687 Shares redeemed (111,088) (1,451,271) (71,305) (925,661) (3,870) (37,172) (2,161) (21,523) ----------- ------------ ---------- ----------- ---------- ------------ ---------- ----------- Net change resulting from Class B Shares transactions 540,657 $ 7,018,468 572,668 $ 7,465,210 33,488 $ 336,119 38,368 $ 381,474 ----------- ------------ ---------- ----------- ---------- ------------ ---------- ----------- Year Ended Year Ended November 30, November 30, 1999 1998 1999 1998 Class Y Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars - -------------------------------------------------------------------------------------------------------------------------- Shares sold 2,668,388 $ 35,085,877 6,639,501 $84,289,682 10,929,844 $107,071,894 6,174,243 $61,683,285 Shares issued in connection with the tax-free exchange of assets from a Common Trust Fund 19,580,102 249,842,105 -- -- 27,808,700 265,851,176 -- -- Shares issued to shareholders in payment of distributions declared 2,693,593 34,392,661 1,895,507 23,557,253 680,497 6,648,424 661,726 6,595,044 Shares redeemed (14,589,443) (192,444,437) (6,222,414) (80,542,002) (9,142,482) (89,531,987) (4,662,142) (46,579,297) ----------- ------------ ---------- ----------- ---------- ------------ ---------- ----------- Net change resulting from Class Y Shares transactions 10,352,640 $126,876,206 2,312,594 $27,304,933 30,276,559 $290,039,507 2,173,827 $21,699,032 ----------- ------------ ---------- ----------- ---------- ------------ ---------- ----------- Net change resulting from fund shares transactions 17,465,655 $220,241,813 7,718,564 $97,427,039 35,179,402 $338,603,387 3,621,745 $36,120,226 ----------- ------------ ---------- ----------- ---------- ------------ ---------- -----------
Intermediate Fixed Income Fund Short-Term Fixed Income Fund ------------------------------------------------- ------------------------------------------------- Year Ended Year Ended November 30, November 30, 1999 1998 1999 1998 Class A Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars - ------------------------------------------------------------------------------------------------------------------------- Shares sold 9,273 $ 90,669 432,820 $ 4,395,676 334,823 $ 3,271,760 728,996 $ 7,145,299 Shares issued to shareholders in payment of distributions declared 25,998 258,389 36,581 370,365 53,919 526,016 48,837 478,947 Exchange into Class Y shares -- -- (8,913,728) (89,493,831) -- -- -- -- Shares redeemed (158,864) (1,556,247) (732,895) (7,416,845) (360,394) (3,523,088) (465,982) (4,580,525) ---------- ----------- ---------- ------------ ---------- ------------ ---------- ----------- Net change resulting from Class A Shares transactions (123,593) $(1,207,189) (9,177,222) $(92,144,635) 28,348 $ 274,688 311,851 $ 3,043,721 ---------- ----------- ---------- ------------ ---------- ------------ ---------- ----------- Year Ended Year Ended November 30, November 30, 1999 1998(1) 1999 1998 Class Y Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars - ------------------------------------------------------------------------------------------------------------------------- Shares sold 2,073,597 $20,392,480 512,332 $ 5,220,989 1,090,901 $ 10,708,051 2,210,120 $21,733,419 Exchange from Class A shares -- -- 8,913,728 89,493,831 -- -- -- -- Shares issued in connection with the tax-free exchange of assets from a Common Trust Fund 6,139,436 59,122,769 -- -- 737,496 7,116,836 -- -- Shares issued to shareholders in payment of distributions declared 39,790 392,705 21,849 222,630 232,891 2,277,295 500,524 4,905,077 Shares redeemed (2,241,312) (22,106,920) (986,184) (10,094,154) (8,005,559) (78,981,570) (2,109,395) (20,644,860) ---------- ----------- ---------- ------------ ---------- ------------ ---------- ----------- Net change resulting from Class Y Shares transactions 6,011,511 $57,801,035 8,461,725 $ 84,843,296 (5,944,271) $(58,879,388) 601,249 $ 5,993,636 ---------- ----------- ---------- ------------ ---------- ------------ ---------- ----------- Net change resulting from fund shares transactions 5,887,918 $56,593,845 (715,497) $ (7,301,339) (5,915,921) $(58,604,700) 913,100 $ 9,037,357 ---------- ----------- ---------- ------------ ---------- ------------ ---------- ----------- (1) Reflects operations for the period from March 30, 1998 (date of initial public investment) to November 30, 1998.
Georgia Municipal Bond Fund North Carolina Municipal Bond Fund ---------------------------------------- ------------------------------------------- Year Ended Year Ended November 30, November 30, 1999 1998 1999 1998 Class A Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars - ----------------------------------------------------------------------------------------------------------------- Shares sold 33,237 $ 371,656 65,313 $734,230 90,928 $1,014,339 73,195 $ 827,761 Shares issued to shareholders in payment of distributions declared 19,481 215,076 18,608 209,598 28,563 317,676 28,831 326,515 Shares redeemed (145,519) (1,595,698) (65,246) (732,153) (145,558) (1,600,626) (308,552) (3,504,406) -------- ----------- ------- -------- -------- ---------- -------- ----------- Net change resulting from Class A Shares transactions (92,801) $(1,008,966) 18,675 $211,675 (26,067) $ (268,611) (206,526) $(2,350,130) -------- ----------- ------- -------- -------- ---------- -------- -----------
Georgia Municipal Bond Fund continued North Carolina Municipal Bond Fund continued ------------------------------------------------ ------------------------------------------------ Year Ended Year Ended November 30, November 30, 1999 1998 1999 1998 Class Y Shares Shares Dollars Shares Dollars Shares Dollars Shares Dollars - ----------------------------------------------------------------------------------------------------------------------------- Shares sold 1,193,251 $ 13,142,034 514,361 $ 5,807,306 3,602,963 $ 39,881,430 1,450,528 $16,388,977 Shares issued in connection with the tax-free exchange of assets from a Common Trust Fund 8,083,520 88,191,199 -- -- 33,367,726 366,043,958 -- -- Shares issued to shareholders in payment of distributions declared 6,888 75,864 5,535 62,357 35,745 399,376 17,718 200,910 Shares redeemed (529,304) (5,769,696) (130,688) (1,473,631) (1,438,326) (15,643,547) (465,404) (5,270,187) ---------- ------------ --------- ----------- ---------- ------------ --------- ----------- Net change resulting from Y Shares transactions 8,754,355 $ 95,639,401 389,208 $ 4,396,032 35,568,108 $390,681,219 1,002,842 $11,319,700 ---------- ------------ --------- ----------- ---------- ------------ --------- ----------- Net change resulting from fund shares transactions 8,661,554 $ 94,630,435 407,883 $ 4,607,707 35,542,041 $390,412,606 796,316 $ 8,969,570 ---------- ------------ --------- ----------- ---------- ------------ --------- ----------- South Carolina Municipal Bond Fund ------------------------------------------------ Year Ended November 30, 1999 1998 Class A Shares Shares Dollars Shares Dollars - -------------------------------------------------------------------------------- Shares sold 499,667 $ 5,542,698 742,299 $ 8,356,816 Shares issued to shareholders in payment of distributions declared 181,068 1,989,742 167,413 1,887,761 Shares redeemed (974,649) (10,649,307) (786,074) (8,835,765) ---------- ------------ --------- ----------- Net change resulting from Class A Shares transactions (293,914) $ (3,116,867) 123,638 $ 1,408,812 ---------- ------------ --------- ----------- Year Ended November 30, 1999 1998 Class Y Shares Shares Dollars Shares Dollars - -------------------------------------------------------------------------------- Shares sold 2,892,396 $ 31,736,212 1,382,049 $15,581,081 Shares issued in connection with the tax-free exchange of assets from a Common Trust Fund 20,754,532 225,809,305 -- -- Shares issued to shareholders in payment of distributions declared 18,138 199,065 13,296 149,911 Shares redeemed (1,154,051) (12,417,303) (517,410) (5,814,407) ---------- ------------ --------- ----------- Net change resulting from Class Y Shares transactions 22,511,015 $245,327,279 877,935 $ 9,916,585 ---------- ------------ --------- ----------- Net change resulting from fund shares transactions 22,217,101 $242,210,412 1,001,573 $11,325,397 ---------- ------------ --------- -----------
Virginia Municipal Bond Fund -------------------------------------------------- Year Ended November 30, 1999 1998 Class A Shares Shares Dollars Shares Dollars - ---------------------------------------------------------------------- Shares sold 24,086 $ 251,062 293,734 $ 3,057,205 Shares issued to shareholders in payment of distributions declared 27,430 279,843 29,282 304,418 Exchange into Class Y shares -- -- (9,794,711) (101,277,312) Shares redeemed (113,459) (1,154,829) (488,052) (5,071,444) ---------- ----------- ---------- ------------- Net change resulting from Class A Shares transactions (61,943) $ (623,924) (9,959,747) $(102,987,133) ---------- ----------- ---------- ------------- Period Ended November 30, 1999 1998(1) Class Y Shares Shares Dollars Shares Dollars - ---------------------------------------------------------------------- Shares sold 2,556,035 $26,045,020 561,359 $ 5,860,079 Shares issued in connection with the tax-free exchange of assets from a Common Trust Fund 3,242,961 32,818,769 -- -- Exchange from Class A shares -- -- 9,794,711 101,277,312 Shares issued to shareholders in payment of distributions declared 27,283 275,816 3,580 37,331 Shares redeemed (2,089,477) (21,200,920) (910,974) (9,483,614) ---------- ----------- ---------- ------------- Net change resulting from Class Y Shares transactions 3,736,802 $37,938,685 9,448,676 $ 97,691,108 ---------- ----------- ---------- ------------- Net change resulting from fund shares transactions 3,674,859 $37,314,761 (511,071) $ (5,296,025) ---------- ----------- ---------- -------------
(1) Reflects operations for the period from March 30, 1998 (date of initial public investment) to November 30, 1998. 4. Investment Adviser Fee and Other Transactions with Affiliates Investment Adviser Fee--Wachovia Asset Management, a subsidiary of Wachovia Bank, N.A. and the Funds' investment adviser (the "Adviser"), receives for its services an annual investment adviser fee based on a percentage of each Fund's average daily net assets as listed below.
Annual Rate Fund ----------- ---- Equity Fund 0.70% Quantitative Equity Fund 0.70% Growth & Income Fund 0.70%* Equity Index Fund 0.30% Special Values Fund 0.80% Emerging Markets Fund 1.00% Personal Equity Fund 0.70% Balanced Fund 0.70% Fixed Income Fund 0.60% Intermediate Fixed Income Fund 0.60%* Short-Term Fixed Income Fund 0.55% Georgia Municipal Bond Fund 0.75% North Carolina Municipal Bond Fund 0.75% South Carolina Municipal Bond Fund 0.75% Virginia Municipal Bond Fund 0.74%*
As a result of contractual obligations, the Adviser may be required to waive any portion of its fee. The Adviser can modify or terminate this waiver at its sole discretion at any time after January 31, 2001. * Prior to March 29, 1998, the annual investment adviser fee based on a percentage of the Fund's average daily net assets for Growth & Income Fund, and Intermediate Fixed Income Fund was 1.00% and 0.74%, respectively. Effective March 29, 1998, Growth & Income Fund, Intermediate Fixed Income Fund, and Virginia Municipal Bond Fund changed investment advisors from Central Fidelity National Bank to Wachovia Asset Management. Sub Adviser Fee--The Adviser has entered into a sub-advisory agreement with Twin Capital Management, Inc. (the "Sub-Adviser"). The Sub-Adviser furnishes certain adviser services to the Adviser for Quantitative Equity Fund, including investment research, quantitative analysis, statistical and other factual information, and recommendations based on the Sub-Adviser's analysis, and assists the Adviser in identifying securities for potential purchase and/or sale. The Sub-Adviser is entitled to receive an annual fee of $55,000 payable by the Adviser. The Sub-Adviser may elect to waive some or all of its fee. Administrative Fee, and Transfer and Dividend Disbursing Agent and Portfolio Accounting Fees--Federated Services Company ("FServ") provides the Funds with certain administrative personnel and portfolio accounting services. FServ, through its subsidiary Federated Shareholder Services Company ("FSSC"), serves as transfer and dividend disbursing agent for the funds. The fee paid to FServ is based on the level of average aggregate net assets of the Trusts (excluding Wachovia Prime Cash Management Fund) for the period. Distribution Services Fee--Equity Fund, Quantitative Equity Fund, Special Values Fund, Balanced Fund, and Fixed Income Fund have adopted a Distribution Plan (the "Plan") pursuant to Rule 12b-1 under the Act. Under the terms of the Plan, the Funds will compensate Federated Securities Corp. ("FSC"), the principal distributor, from their respective net assets to finance certain activities intended to result in the sale of Class B Shares. The Plan provides that each Fund may incur distribution expenses up to 0.75% of the average daily net assets of each Fund's Class B Shares, annually, to compensate FSC. FSC may voluntarily choose to waive any portion of its fee and/or reimburse certain operating expenses of the Funds. FSC can modify or terminate this voluntary waiver and/or reimbursement at any time at its sole discretion. Shareholder Services Fee--Under the terms of a Shareholder Services Agreement with Federated Administrative Services, ("FAS"), the Fund will pay FAS up to 0.25% of average daily net assets of each Fund's Class A Shares and Class B Shares for the period. The fee paid to FAS is used to finance certain services for shareholders and to maintain shareholder accounts. FAS may voluntarily choose to waive any portion of its fee. FAS can modify or terminate this voluntary waiver at any time at its sole discretion. Custodian Fees--Wachovia Bank, N.A. is the Funds' custodian. The fee is based on the level of each Fund's average daily net assets for the period, plus out- of-pocket expenses. Organizational Expenses--Organizational expenses were borne initially by FAS. The Funds have reimbursed FAS for the organizational expenses. These expenses have been deferred and are being amortized over the five-year period following each Fund's effective date. For the year ended November 30, 1999, the Funds expensed the following amounts pursuant to this agreement:
Organizational Organizational Fund Expenses Expenses Paid ---- -------------- -------------- Emerging Markets Fund $40,764 $17,788 Georgia Municipal Bond Fund $30,000 $ 9,391 North Carolina Municipal Bond Fund $30,000 $ 294
General--Certain of the Officers of the Trusts are Officers and Directors or Trustees of the above companies. 5. Investment Transactions Purchases and sales of investments, excluding short-term securities, for the period ended November 30, 1999, were as follows:
Fund Purchases Sales - ---- ------------ ------------ Equity Fund $144,635,541 $119,428,961 Quantitative Equity Fund 144,082,605 151,133,803 Growth & Income Fund 140,984,246 180,637,704 Equity Index Fund 51,058,748 99,147,328 Special Values Fund 62,038,604 60,932,871 Emerging Markets Fund 86,988,003 87,303,268 Personal Equity Fund 45,991,790 74,705,882 Balanced Fund 305,133,992 354,886,877 Fixed Income Fund 246,207,093 166,264,291 Intermediate Fixed Income Fund 91,539,161 90,284,722 Short-Term Fixed Income Fund 14,124,900 77,256,318 Georgia Municipal Bond Fund 31,871,447 24,453,363 North Carolina Municipal Bond Fund 51,723,218 18,881,237 South Carolina Municipal Bond Fund 35,212,957 16,614,268 Virginia Municipal Bond Fund 32,884,704 44,235,101
6. Concentration of Credit Risk Emerging Markets Fund invests in securities of non-U.S. issuers. Although the Fund maintains a diversified investment portfolio, the political or economic developments within a particular country or region may have an adverse effect on the ability of domiciled issuers to meet their obligations. Additionally, political or economic developments may have an effect on the liquidity and volatility of portfolio securities and currency holdings. At November 30, 1999, the diversification of the industries for the Emerging Markets Fund was as follows:
Industry % of Net Assets - -------- --------------- Communication Services 18.1% Finance 16.9% Basic Materials 10.8% Technology 8.5% Consumer Staples 7.8% Multi-Industry 6.5% Closed End Funds 6.1% Energy 5.9% Consumer Cyclicals 4.9% Utilities 4.8% Other 1.9% Health Care 1.8% Transportation 1.5% Capital Goods 0.4%
Since The Wachovia Municipal Funds invest a substantial portion of their assets in issuers located in one state, they will be more susceptible to factors adversely affecting issuers of that state than would be a comparable tax-exempt mutual fund that invests nationally. In order to reduce the credit risk associated with such factors, at November 30, 1999, the securities in the portfolio of investments are backed by letters of credit or bond insurance of various financial institutions and financial guaranty assurance agencies, as indicated below. The largest percentage of investments insured by or supported (backed) by a letter of credit from any one institution or agency is also indicated below.
% of Portfolio Backed by % of Portfolio Largest Fund Guaranteed/Insured Guarantor/Insurer - ---- ------------------ ------------------------ Georgia Municipal Bond Fund 35.4% 9.6% North Carolina Municipal Bond Fund 17.4% 7.2% South Carolina Municipal Bond Fund 61.3% 25.3% Virginia Municipal Bond Fund 21.5% 4.3%
- ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Report of Ernst & Young LLP, Independent Auditors To the Trustees and Shareholders of THE WACHOVIA FUNDS and THE WACHOVIA MUNICIPAL FUNDS: We have audited the accompanying statements of assets and liabilities, including the portfolios of investments, of the Wachovia Equity Fund, Wachovia Quantitative Equity Fund, Wachovia Growth and Income Fund, Wachovia Equity Index Fund, Wachovia Special Values Fund, Wachovia Emerging Markets Fund, Wachovia Personal Equity Fund, Wachovia Balanced Fund, Wachovia Fixed Income Fund, Wachovia Intermediate Fixed Income Fund, and the Wachovia Short-Term Fixed Income Fund (11 of the portfolios constituting The Wachovia Funds) and the Wachovia Georgia Municipal Bond Fund, Wachovia North Carolina Municipal Bond Fund, Wachovia South Carolina Municipal Bond Fund, and Wachovia Virginia Municipal Bond Fund (the 4 portfolios constituting The Wachovia Municipal Funds) as of November 30, 1999, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended and the financial highlights for each of the periods presented therein. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of November 30, 1999, by correspondence with the custodian and brokers or other appropriate auditing procedures where replies from brokers were not received. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Wachovia Equity Fund, Wachovia Quantitative Equity Fund, Wachovia Growth and Income Fund, Wachovia Equity Index Fund, Wachovia Special Values Fund, Wachovia Emerging Markets Fund, Wachovia Personal Equity Fund, Wachovia Balanced Fund, Wachovia Fixed Income Fund, Wachovia Intermediate Fixed Income Fund, Wachovia Short-Term Fixed Income Fund (portfolios of The Wachovia Funds) and the Wachovia Georgia Municipal Bond Fund, Wachovia North Carolina Municipal Bond Fund, Wachovia South Carolina Municipal Bond Fund, and Wachovia Virginia Municipal Bond Fund (portfolios of The Wachovia Municipal Funds) at November 30, 1999, the results of their operations for the year then ended, the changes in their net assets for each of the two years in the period then ended, and the financial highlights for each of the periods presented therein, in conformity with accounting principles generally accepted in the United States. Boston, Massachusetts January 17, 2000 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Trustees Officers James A. Hanley John W. McGonigle Samuel E. Hudgins President and Treasurer J. Berkley Ingram, Jr. Charles L. Davis, Jr. D. Dean Kaylor Vice President and Assistant Treasurer Alvin J. Schexnider Gail Cagney Charles S. Way, Jr. Secretary Timothy S. Johnson Assistant Secretary Mutual funds are not bank deposits or obligations, are not guaranteed by any bank, and are not insured or guaranteed by the U.S. government, the Federal Deposit Insurance Corporation, the Federal Reserve Board, or any other government agency. Investment in mutual funds involves risk, including possible loss of principal. This report is authorized for distribution to prospective investors only when preceded or accompanied by the Fund's prospectus which contains facts concerning its investment objective and policies, management fees, expenses and other information. Federated Securities Corp., Distributor 831-27 (1/00) G01512-17 (1/00) WACHOVIA APPENDIX DOCUMENT A1 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class A Shares of Wachovia Equity Fund based on a 4.50% sales load are represented by a solid line. The Standard & Poor's 500 Index (the "S&P 500") is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class A Shares of the fund, and the S&P 500. The "x" axis reflects computation periods from 5/7/93 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class A Shares, based on a 4.50% sales load, as compared to the S&P 500. The ending values were $28,936, and $36,086, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class A Shares Average Annual Total Returns for the one-year and five-year periods ended 11/30/99 and from the fund's start of performance (5/7/93) (cumulative) and start of performance (5/7/93) to 11/30/99. The total returns were 18.71%, 22.03%, 189.36% and 17.55%, respectively. A2 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class B Shares of Wachovia Equity Fund are represented by a solid line. The Standard & Poor's 500 Index (the "S&P 500") is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class A Shares of the fund, and the S&P 500. The "x" axis reflects computation periods from 7/23/96 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class B Shares, as compared to the S&P 500. The ending values were $20,147, and $23,397, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class B Shares Average Annual Total Returns for the one-year period ended 11/30/99 and from the fund's start of performance (7/23/96) (cumulative) and start of performance (7/23/96) to 11/30/99. The total returns were 18.37%, 101.47% and 23.19%, respectively. A3. The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class Y Shares of Wachovia Equity Fund are represented by a solid line. The Standard & Poor's 500 Index (the "S&P 500") is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class Y Shares of the fund, and the S&P 500. The "x" axis reflects computation periods from 7/23/96 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class A Shares, as compared to the S&P 500. The ending values were $21,105, and $23,397, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class Y Shares Average Annual Total Returns for the one-year period ended 11/30/99 and from the fund's start of performance (7/23/96) (cumulative) and start of performance (7/23/96) to 11/30/99. The total returns were 24.52%, 111.05% and 24.90%, respectively. A4 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class A Shares of Wachovia Quantitative Equity Fund based on a 4.50% sales load are represented by a solid line. The Standard & Poor's 500 Index (the "S&P 500") is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class A Shares of the fund, and the S&P 500. The "x" axis reflects computation periods from 3/25/94 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class A Shares, based on a 4.50% sales load, as compared to the S&P 500. The ending values were $28,648, and $33,809, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class A Shares Average Annual Total Returns for the one-year and five-year periods ended 11/30/99 and from the fund's start of performance (3/25/94) (cumulative) and start of performance (3/25/94) to 11/30/99. The total returns were 11.33%, 24.21%, 186.48% and 20.33%, respectively. A5 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class B Shares of Wachovia Quantitative Equity Fund are represented by a solid line. The Standard & Poor's 500 Index (the "S&P 500") is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class B Shares of the fund, and the S&P 500. The "x" axis reflects computation periods from 7/23/96 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class A Shares, as compared to the S&P 500. The ending values were $20,760, and $23,397, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class B Shares Average Annual Total Returns for the one-year period ended 11/30/99 and from the fund's start of performance (7/23/96) (cumulative) and start of performance (7/23/96) to 11/30/99. The total returns were 10.85%, 107.60% and 24.29%, respectively. A6 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class Y Shares of Wachovia Quantitative Equity Fund are represented by a solid line. The Standard & Poor's 500 Index (the "S&P 500") is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class Y Shares of the fund, and the S&P 500. The "x" axis reflects computation periods from 7/23/96 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class Y Shares, as compared to the S&P 500. The ending values were $21,753, and $23,397, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class Y Shares Average Annual Total Returns for the one-year period ended 11/30/99 and from the fund's start of performance (7/23/96) (cumulative) and start of performance (7/23/96) to 11/30/99. The total returns were 16.97%, 117.53% and 26.03%, respectively. A7 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class A Shares of Wachovia Growth and Income Fund based on a 4.50% sales load are represented by a solid line. The Standard & Poor's 500 Index (the "S&P 500") is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class A Shares of the fund, and the S&P 500. The "x" axis reflects computation periods from 1/29/93 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class A Shares, based on a 4.50% sales load, as compared to the S&P 500. The ending values were $31,357, and $36,674, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class A Shares Average Annual Total Returns for the one-year and five-year periods ended 11/30/99 and from the fund's start of performance (1/29/93) (cumulative) and start of performance (1/29/93) to 11/30/99. The total returns were 14.98%, 25.41%, 213.57% and 18.95%, respectively. A8 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class Y Shares of Wachovia Growth and Income Fund are represented by a solid line. The Standard & Poor's 500 Index (the "S&P 500") is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class Y Shares of the fund, and the S&P 500. The "x" axis reflects computation periods from 3/29/98 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class Y Shares, as compared to the S&P 500. The ending values were $12,801, and $12,974, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class Y Shares Average Annual Total Returns for the one-year period ended 3/29/98 and from the fund's start of performance (3/29/98) (cumulative) and start of performance (3/29/98) to 11/30/99. The total returns were 20.73%, 28.01% and 15.90%, respectively. A9 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class A Shares of Wachovia Equity Index Fund based on a 4.50% sales load are represented by a solid line. The Standard & Poor's 500 Index (the "S&P 500") is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class A Shares of the fund, and the S&P 500. The "x" axis reflects computation periods from 5/7/93 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class A Shares, based on a 4.50% sales load, as compared to the S&P 500. The ending values were $33,050, and $36,086, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class A Shares Average Annual Total Returns for the one-year and five-year periods ended 11/30/99 and from the fund's start of performance (5/7/93) (cumulative) and start of performance (5/7/93) to 11/30/99. The total returns were 14.56%, 25.45%, 230.50% and 19.96%, respectively. A10 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class Y Shares of Wachovia Equity Index Fund are represented by a solid line. The Standard & Poor's 500 Index (the "S&P 500") is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class Y Shares of the fund, and the S&P 500. The "x" axis reflects computation periods from 7/23/96 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class Y Shares, as compared to the S&P 500. The ending values were $22,738, and $23,397, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class Y Shares Average Annual Total Returns for the one-year period ended 11/30/99 and from the fund's start of performance (7/23/93) (cumulative) and start of performance (7/23/93) to 11/30/99. The total returns were 20.24%, 127.38% and 27.71%, respectively. A11 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class A Shares of Wachovia Special Values Fund based on a 4.50% sales load are represented by a solid line. The Russell 2000 Index (the "Russell 2000") is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class A Shares of the fund, and the Russell 2000. The "x" axis reflects computation periods from 5/7/93 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class A Shares, based on a 4.50% sales load, as compared to the Russell 2000. The ending values were $20,183, and $22,839, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class A Shares Average Annual Total Returns for the one-year and five-year periods ended 11/30/99 and from the fund's start of performance (5/7/93) (cumulative) and start of performance (5/7/93) to 11/30/99. The total returns were 0.66%, 17.78%, 128.39% and 13.39%, respectively. A12 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class B Shares of Wachovia Special Values Fund are represented by a solid line. The Russell 2000 Index (the "Russell 2000") is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class A Shares of the fund, and the Russell 2000. The "x" axis reflects computation periods from 3/26/99 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class B Shares, as compared to the Russell 2000. The ending values were $10,452, and $11,633, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class B Shares Average Annual Total Returns from the fund's start of performance (5/7/93) (cumulative) to 11/30/99. The total returns was 4.52. A13 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class Y Shares of Wachovia Special Values are represented by a solid line. The Russell 2000 Index (the "Russell 2000") is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class Y Shares of the fund, and the Russell 2000. The "x" axis reflects computation periods from 7/23/96 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class Y Shares, as compared to the Russell 2000. The ending values were $15,615, and $14,759, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class Y Shares Average Annual Total Returns for the one-year period ended 11/30/99 and from the fund's start of performance (7/23/96) (cumulative) and start of performance (7/23/96) to 11/30/99. The total returns were 5.61%, 56.15% and 14.19%, respectively. A14 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class A Shares of Wachovia Emerging Markets Fund based on a 4.50% sales load are represented by a solid line. The International Finance Corporation Investable Index (the "IFCI") is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class A Shares of the fund, and the IFCA. The "x" axis reflects computation periods from 12/23/94 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class A Shares, based on a 4.50% sales load, as compared to the IFCA. The ending values were $11,529, and $9,767, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class A Shares Average Annual Total Returns for the one-year period ended 11/30/99 and from the fund's start of performance (12/22/94) (cumulative) and start of performance (12/23/94) to 11/30/99. The total returns were 33.72%, 15.29% and 2.92%, respectively. A15 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class Y Shares of Wachovia Emerging Markets Fund are represented by a solid line. The International Finance Corporation Investable Index (the "IFCI") is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class Y Shares of the fund, and the IFCA. The "x" axis reflects computation periods from 7/23/96 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class Y Shares, compared to the IFCA. The ending values were $10,153, and $9,859, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class A Shares Average Annual Total Returns for the one-year period ended 11/30/99 and from the fund's start of performance (7/23/96) (cumulative) and start of performance (17/23/96) to 11/30/99. The total returns were 40.39%, 1.53% and 0.45%, respectively. A16 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class A Shares of Wachovia Personal Equity Fund based on a 4.50% sales load are represented by a solid line. The Standard & Poor's 500 Index (the "S&P 500") is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class A Shares of the fund, and the S&P 500. The "x" axis reflects computation periods from 7/30/99 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class A Shares, based on a 4.50% sales load, as compared to the S&P500. The ending values were $10,196 and $11,483, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class A Shares Average Annual Total Returns for the fund's start of performance (12/22/94) (cumulative) to 11/30/99. The total returns were 1.96% A17 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class Y Shares of Wachovia Personal Equity Fund are represented by a solid line. The Standard & Poor's 500 Index (the "S&P 500") is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class Y Shares of the fund, and the S&P 500. The "x" axis reflects computation periods from 7/30/99 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class Y Shares, as compared to the S&P500. The ending values were $10,685 and $11,483, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class A Shares Average Annual Total Returns for the fund's start of performance (12/22/94) (cumulative) to 11/30/99. The total returns were 6.85%. A18 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class A Shares of Wachovia Balanced Fund based on a 4.50% sales load are represented by a solid line. The Standard & Poor's 500 Index (the "S&P 500") is represented by a dotted line and the Lehman Brothers Aggregate Bond Index (the "LBABI"). The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class A Shares of the fund, the S&P 500 and the LBABI. The "x" axis reflects computation periods from 5/7/93 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class A Shares, based on a 4.50% sales load, as compared to the S&P 500, and the LBABI. The ending values were $22,429, $36,086 and $14,730, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class A Shares Average Annual Total Returns for the one-year and five-year periods ended 11/30/99 and from the fund's start of performance (5/7/93) (cumulative) and start of performance (5/7/93) to 11/30/99. The total returns were 8.80%, 16.50%, 124.29% and 13.08%, respectively. A19 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class B Shares of Wachovia Balanced Fund are represented by a solid line. The Standard & Poor's 500 Index (the "S&P 500") is represented by a dotted line and the Lehman Brothers Aggregate Bond Index (the "LBABI"). The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class B Shares of the fund, the S&P 500 and the LBABI. The "x" axis reflects computation periods from 7/23/96 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class B Shares, as compared to the S&P 500, and the LBABI. The ending values were $16,485, $23,397 and $12,247, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class A Shares Average Annual Total Returns for the one-year period ended 11/30/99 and from the fund's start of performance (7/23/96) (cumulative) and start of performance (7/23/96) to 11/30/99. The total returns were 8.18%, 64.85% and 16.05%, respectively. A20 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class Y Shares of Wachovia Balanced Fund are represented by a solid line. The Standard & Poor's 500 Index (the "S&P 500") is represented by a dotted line and the Lehman Brothers Aggregate Bond Index (the "LBABI"). The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class Y Shares of the fund, the S&P 500 and the LBABI. The "x" axis reflects computation periods from 7/23/96 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class Y Shares, as compared to the S&P 500, and the LBABI. The ending values were $17,344, $23,397 and $12,247, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class A Shares Average Annual Total Returns for the one-year period ended 11/30/99 and from the fund's start of performance (7/23/96) (cumulative) and start of performance (7/23/96) to 11/30/99. The total returns were 14.21%, 73.44% and 17.82%, respectively. A21 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class A Shares of Wachovia Fixed Income Fund based on a 4.50% sales load are represented by a solid line. The Lehman Brothers Aggregate Bond Index (the "LBABI") is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class A Shares of the fund, and the LBABI. The "x" axis reflects computation periods from 5/7/93 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class A Shares, based on a 4.50% sales load, as compared to the LBABI. The ending values were, $13,323 and $14,730, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class A Shares Average Annual Total Returns for the one-year and five-year periods ended 11/30/99 and from the fund's start of performance (5/7/93) (cumulative) and start of performance (5/7/93) to 11/30/99. The total returns were (5.26)%, 6.21%, 33.23% and 4.46%, respectively. A22 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class B Shares of Wachovia Fixed Income Fund are represented by a solid line. The Lehman Brothers Aggregate Bond Index (the "LBABI") is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class B Shares of the fund, and the LBABI. The "x" axis reflects computation periods from 7/23/96 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class B Shares, as compared to the LBABI. The ending values were, $11,541 and $12,427, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class B Shares Average Annual Total Returns for the one-year period ended 11/30/99 and from the fund's start of performance (7/23/96) (cumulative) and start of performance (7/23/96) to 11/30/99. The total returns were (6.21)%, 15.41% and 4.36%, respectively. A23 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class Y Shares of Wachovia Fixed Income Fund are represented by a solid line. The Lehman Brothers Aggregate Bond Index (the "LBABI") is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class Y Shares of the fund, and the LBABI. The "x" axis reflects computation periods from 7/23/96 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class Y Shares, as compared to the LBABI. The ending values were, $12,231 and $12,427, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class Y Shares Average Annual Total Returns for the one-year period ended 11/30/99 and from the fund's start of performance (7/23/96) (cumulative) and start of performance (7/23/96) to 11/30/99. The total returns were (0.53)%, 22.31% and 6.18%, respectively. A24 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class A Shares of Wachovia Intermediate Fixed Income Fund based on a 4.50% sales load are represented by a solid line. The Lehman Brothers Gov.t/ Corp. Intermediate Index (the "LBGCII") is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class A Shares of the fund, and the LBGCII. The "x" axis reflects computation periods from 1/29/93 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class A Shares, based on a 4.50% sales load, as compared to the LBGCII. The ending values were, $13,338 and $14,616, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class A Shares Average Annual Total Returns for the one-year and five-year periods ended 11/30/99 and from the fund's start of performance (1/29/93) (cumulative) and start of performance (1/29/93) to 11/30/99. The total returns were (5.50)%, 5.61%, 33.38% and 4.30%, respectively. A25 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class Y Shares of Wachovia Intermediate Fixed Income Fund are represented by a solid line. The Lehman Brothers Gov.t/ Corp. Intermediate Index (the "LBGCII") is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class Y Shares of the fund, and the LBGCII. The "x" axis reflects computation periods from 3/29/98 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class Y Shares, as compared to the LBGCII. The ending values were, $10,626 and $10,629, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class Y Shares Average Annual Total Returns for the one-year period ended 11/30/99 and from the fund's start of performance (3/29/98) (cumulative) and start of performance (3/29/9893) to 11/30/99. The total returns were (0.77)%, 6.28%, and 3.71%, respectively. A26 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class A Shares of Wachovia Short-Term Fixed Income Fund based on a 4.50% sales load are represented by a solid line. The Merrill Lynch 1-3 Year U.S. Treasury Index is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class A Shares of the fund, and the Merrill Lynch 1-3 Year U.S. Treasury Index. The "x" axis reflects computation periods from 5/7/93 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class A Shares, based on a 4.50% sales load, as compared to the Merrill Lynch 1-3 Year U.S. Treasury Index. The ending values were, $12,973 and $14,090, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class A Shares Average Annual Total Returns for the one-year and five-year periods ended 11/30/99 and from the fund's start of performance (5/7/93) (cumulative) and start of performance (5/7/93) to 11/30/99. The total returns were (0.08)%, 5.15%, 32.38% and 4.36%, respectively. A27 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class Y Shares of Wachovia Short-Term Fixed Income Fund are represented by a solid line. The Merrill Lynch 1-3 Year U.S. Treasury Index is represented by a dotted line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class Y Shares of the fund, and the Merrill Lynch 1-3 Year U.S. Treasury Index. The "x" axis reflects computation periods from 7/23/96 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class Y Shares, , as compared to the Merrill Lynch 1-3 Year U.S. Treasury Index. The ending values were, $11,943 and $12,144, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class Y Shares Average Annual Total Returns for the one-year period ended 11/30/99 and from the fund's start of performance (7/23/96) (cumulative) and start of performance (7/23/96) to 11/30/99. The total returns were 2.70%, 19.43% and 5.43%, respectively. A28 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class A Shares of Wachovia Georgia Municipal Bond Fund based on a 4.50% sales load are represented by a solid line. The Lehman Brothers State General Obligation Bond Index (LBSGOBI) is represented by a dotted line and the Lehman Brothers Municipal Bond Index (LBMBI) is represented by a dashed line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class A Shares of the fund, and the LBSGOBI and the LBMBI. The "x" axis reflects computation periods from 12/23/94 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class A Shares, based on a 4.50% sales load, as compared to the LBSGOBI and the LBMBI. The ending values were, $12,442, $13,942 and $14,383, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class A Shares Average Annual Total Returns for the one-year period ended 11/30/99 and from the fund's start of performance (12/23/94) (cumulative) and start of performance (12/23/94) to 11/30/99. The total returns were (7.23)%, 24.42% and 4.52%, respectively. A29 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class Y Shares of Wachovia Georgia Municipal Bond Fund are represented by a solid line. The Lehman Brothers State General Obligation Bond Index (LBSGOBI) is represented by a dotted line and the Lehman Brothers Municipal Bond Index (LBMBI) is represented by a dashed line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class Y Shares of the fund, and the LBSGOBI and the LBMBI. The "x" axis reflects computation periods from 7/23/96 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class Y Shares, as compared to the LBSGOBI and the LBMBI. The ending values were, $11,443, $12,035 and $11,896, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class Y Shares Average Annual Total Returns for the one-year period ended 11/30/99 and from the fund's start of performance (7/23/96) (cumulative) and start of performance (7/23/96) to 11/30/99. The total returns were (2.59)%, 14.43% and 4.10%, respectively. A30 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class A Shares of Wachovia North Carolina Municipal Bond Fund based on a 4.50% sales load are represented by a solid line. The Lehman Brothers State General Obligation Bond Index (LBSGOBI) is represented by a dotted line and the Lehman Brothers Municipal Bond Index (LBMBI) is represented by a dashed line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class A Shares of the fund, and the LBSGOBI and the LBMBI. The "x" axis reflects computation periods from 12/23/94 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class A Shares, based on a 4.50% sales load, as compared to the LBSGOBI and the LBMBI. The ending values were, $12,631, $13,942 and $14,383, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class A Shares Average Annual Total Returns for the one-year period ended 11/30/99 and from the fund's start of performance (12/23/94) (cumulative) and start of performance (12/23/94) to 11/30/99. The total returns were (6.73)%, 26.31% and 4.84%, respectively. A31 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class Y Shares of Wachovia North Carolina Municipal Bond Fund are represented by a solid line. The Lehman Brothers State General Obligation Bond Index (LBSGOBI) is represented by a dotted line and the Lehman brothers Municipal Bond Index (LBMBI) is represented by a dashed line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class Y Shares of the fund, and the LBSGOBI and the LBMBI. The "x" axis reflects computation periods from 12/23/94 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class Y Shares, as compared to the LBSGOBI and the LBMBI. The ending values were, $11,573, $11,896 and $12,035, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class A Shares Average Annual Total Returns for the one-year period ended 11/30/99 and from the fund's start of performance (7/23/96) (cumulative) and start of performance (7/23/96) to 11/30/99. The total returns were (2.09)%, 15.73% and 4.44%, respectively. A32 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class A Shares of Wachovia South Carolina Municipal Bond Fund based on a 4.50% sales load are represented by a solid line. The Lehman Brothers State General Obligation Bond Index (LBSGOBI) is represented by a dotted line and the Lehman Brothers Municipal Bond Index (LBMBI) is represented by a dashed line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class A Shares of the fund, and the LBSGOBI and the LBMBI. The "x" axis reflects computation periods from 1/11/91 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class A Shares, based on a 4.50% sales load, as compared to the LBSGOBI and the LBMBI. The ending values were, $16,323, $17,869 and $18,827, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class A Shares Average Annual Total Returns for the one-year and five-year periods ended 11/30/99 and from the fund's start of performance (1/11/91) (cumulative) and start of performance (1/11/91) to 11/30/99. The total returns were (6.91)%, , 5.44%, 63.23% and 5.67%, respectively. A33 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class Y Shares of Wachovia South Carolina Municipal Bond Fund are represented by a solid line. The Lehman Brothers State General Obligation Bond Index (LBSGOBI) is represented by a dotted line and the Lehman Brothers Municipal Bond Index (LBMBI) is represented by a dashed line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class Y Shares of the fund, and the LBSGOBI and the LBMBI. The "x" axis reflects computation periods from 7/23/96 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class Y Shares, as compared to the LBSGOBI and the LBMBI. The ending values were, $11,668, $11,896 and $12,035, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class A Shares Average Annual Total Returns for the one-year period ended 11/30/99 and from the fund's start of performance (7/23/96) (cumulative) and start of performance (7/23/96) to 11/30/99. The total returns were (2.24)%, 16.68% and 4.70%, respectively. A34 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class A Shares of Wachovia Virginia Municipal Bond Fund based on a 4.50% sales load are represented by a solid line. The Lehman Municipal Bond Index (LBMBI) is represented by a dotted line and the Lehman Brothers Municipal Bond 7-Year Index (LBMB7YI) is represented by a dashed line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class A Shares of the fund, and the LBMBI and the LBMB7YI. The "x" axis reflects computation periods from 2/1/93 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class A Shares, based on a 4.50% sales load, as compared to the LBMBI and the LBMB7YI. The ending values were, $12,515, $14,813 and $14,458, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class A Shares Average Annual Total Returns for the one-year and five-year periods ended 11/30/99 and from the fund's start of performance (2/1/93) (cumulative) and start of performance (2/1/93) to 11/30/99. The total returns were (6.38)%, 4.52%, 25.15% and 3.34%, respectively. A35 The graphic presentation here displayed consists of a line graph. The corresponding components of the line graph are listed underneath. The Class Y Shares of Wachovia Virginia Municipal Bond Fund are represented by a solid line. The Lehman Municipal Bond Index (LBMBI) is represented by a dotted line and the Lehman Brothers Municipal Bond 7-Year Index (LBMB7YI) is represented by a dashed line. The line graph is a visual representation of a comparison of change in value of a $10,000 hypothetical investment in the Class Y Shares of the fund, and the LBMBI and the LBMB7YI. The "x" axis reflects computation periods from 3/29/98 to 11/30/99. The "y" axis reflects the cost of the investment. The right margin reflects the ending value of the hypothetical investment in the fund's Class Y Shares, as compared to the LBMBI and the LBMB7YI. The ending values were, $10,276, $10,388 and $10,531, respectively. The legend in the bottom quadrant of the graphic presentation indicates the fund's Class Y Shares Average Annual Total Returns for the one-year period ended 11/30/99 and from the fund's start of performance (3/29/98) (cumulative) and start of performance (3/29/98) to 11/30/99. The total returns were (1.76)%, 2.76% and 1.64%, respectively. -----END PRIVACY-ENHANCED MESSAGE-----