UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________
FORM N-CSR
________
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number 811-0792
CNI Charter Funds
(Exact name of registrant as specified in charter)
________
400 North Roxbury Drive
Beverly Hills, CA 90210
(Address of principal executive offices) (Zip code)
SEI Investments Distributors
1 Freedom Valley Drive
Oaks, PA 19456
(Name and address of agent for service)
Registrant’s telephone number, including area code: 1-888-889-0799
Date of fiscal year end: September 30, 2012
Date of reporting period: September 30, 2012
Item 1. Reports to Stockholders.
This report and the financial statements contained herein are provided for the general information of the shareholders of CNI Charter Funds. This report is not authorized for distribution to prospective investors in CNI Charter Funds unless preceded or accompanied by an effective prospectus. Please remember that past performance is no guarantee of future results.
Shares of CNI Charter Funds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency and involve investment risks, including the possible loss of the principal amount invested.
TABLE OF CONTENTS
CNI Charter Funds Annual Report
| 2 | Letter to Our Shareholders |
| 4 | Money Market Funds Investment Adviser's Report |
| 6 | Fixed Income and Blended Funds Investment Adviser's Report |
| 10 | Fixed Income and Blended Funds Overview |
| 17 | Equity Funds Investment Adviser's Report |
| 20 | Equity Funds Overview |
| 24 | Schedule of Investments |
| 82 | Statements of Assets and Liabilities |
| 86 | Statements of Operations |
| 90 | Statements of Changes in Net Assets |
| 96 | Financial Highlights |
| 100 | Notes to Financial Statements |
| 111 | Report of Independent Registered Public Accounting Firm |
| 112 | Trustees and Officers |
| 114 | Notice to Shareholders |
| 115 | Disclosure of Fund Expenses |
| 117 | Board Approval of Advisory and Sub-Advisory Agreements |
The Funds file their complete schedules of portfolio holdings with the Securities and Exchange Commission (the “Commission”) for the first and third quarters of each fiscal year on Form N-Q within 60 days after the end of the period. The Funds’ Form N-Q filings are available on the Commission’s website at http://www.sec.gov, and may be reviewed and copied at the Commission’s Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330. The most current Form N-Q filing is also available on the Funds’ website at www.cnicharterfunds.com and without charge, upon request, by calling 1-888-889-0799.
A description of the policies and procedures that the Funds use to determine how to vote proxies relating to the Funds’ portfolio securities, and information on how the Funds voted proxies relating to portfolio securities during the most recent 12-month period ending June 30 is available (1) without charge, upon request, by calling 1-888-889-0799, (2) on the Funds’ website at www.cnicharterfunds.com, and (3) on the Securities and Exchange Commission’s website at www.sec.gov.
CNI CHARTER FUNDS | PAGE 1
| letter to our shareholders |
September 30, 2012 |
| ECONOMIC AND MARKET OVERVIEW |
The beginning of the fiscal year nearly coincided with the October 3, 2011 low point of the U.S. stock market. The downturn had been triggered by concerns about slower economic growth in China and the U.S., European sovereign debt and the federal budget ceiling showdown in Washington. These three themes framed stock and bond market results and the economy figured predominantly in the election campaign over the past twelve months. After compromises were reached, albeit temporarily, within the European Union and Congress, domestic stocks rebounded in the first half of the fiscal year, with the S&P 500 gaining 29.6% at the mid-point of the year as investors concentrated on strong corporate balance sheets and an improving economic scenario.
The June quarter saw a pullback in the domestic and international equity markets as signs of a slowdown became apparent and optimistic economic growth estimates in the U.S. and China were revised downward. While the U.S. rate of growth was lowered from 2% to 1.5%, expectations for China’s declined from 10% to 7%, still an exuberant rate of growth. The European Central Bank (“ECB”) had a series of stop-start resolutions within the Union as Spain and Italy began to show mounting signs of financial strain. As global equity and foreign markets retreated, domestic bonds gained, as investors sought the safe haven of U.S. government bonds and the improving financial condition of many U.S. corporations.
Beginning in early June, equity markets began a steady climb that peaked with the Fed’s announcement of another round of quantitative easing in September. The question arises: what accounts for the strong performance over the summer of the riskier asset classes such as stocks? As stated above, U.S. economic activity weakened slightly from its already sluggish pace while the European recession deepened. Predictions of China’s soft economic landing were threatened by a number of data points that were below forecasters’ already-diminished expectations. No visible progress was achieved in solving the notorious “fiscal cliff” problem, which threatens to cause a recession next year in the U.S. if left unattended. What, then, caused investors to rediscover their appetite for risk?
One of the stock market’s tried-and-true maxims is “don’t fight the Fed,” meaning that when the Federal Open Market Committee (“FOMC”) is attempting to stimulate the economy through monetary easing, it is generally a bad time to be betting against stocks. In the environment we face today, one could easily extend that adage to “don’t fight the ECB, the People’s Bank of China, or the hundreds of other less influential central banks that have made easing moves around the world over the past year.” Not quite as crisp, but equally important as the Fed message.
Indeed, as the global economic conditions worsened throughout the summer, investors became convinced that more aggressive stimulus would be forthcoming. And they were not disappointed. Comments by ECB President Mario Draghi and Fed Chairman Ben Bernanke confirmed their intentions to “do whatever is necessary” to improve the economic conditions in their regions. Only China, confronting an important leadership change planned for November, has so far failed to follow through with the aggressive stimulus that many economists are advocating.
Are these easing moves a panacea for the world’s ailing economies and a ticket to higher stock prices? Certainly not. Many of these actions involve injecting additional liquidity into local economies by central banks’ increasing the money supply, i.e. “printing more money.” The risks of such a strategy include rising inflation, declining value of the local currency, and increasing governmental debt burdens. Gold’s 13.5% rise in the last fiscal quarter is testimony to investors’ concerns about these actions, in that gold is viewed as a safe haven during periods of monetary expansion.
So far, none of the negative side effects of these actions has been realized. Inflation remains well under control at around 2%, and the U.S. dollar has been relatively stable versus other major currencies (whose central banks are undertaking similar forms of stimulus). As a result, interest rates have remained benign, providing another quarter of solid returns from fixed income securities. High yield bonds, an area we highlighted late last year as particularly attractive, have delivered outstanding results, generating a total return of more than 12% in 2012.
CNI CHARTER FUNDS | PAGE 2
While our preference would be for higher asset prices to be driven by accelerating economic growth and stronger corporate earnings, for now the actions of global central banks appear to be winning the day. It remains to be seen how long this will appease investors before the bill comes due.
Post the Funds’ fiscal year end the U.S. saw the culmination of a long election campaign with the result that the federal government will continue to be divided between a Democratic White House and a split Congress, with Republicans holding the majority in the House. What kind of compromise will be reached to solve the $600 billion “fiscal cliff” is the overwhelming question for investors in the coming months. The triggering of sequestration of the federal budget would possibly cause a recession, while an increase in taxes may be a drag on growth. Countering that argument, continued borrowing by the federal government, predominantly from China, mounts further debt on a large deficit. Since these issues are at the top of investors’ agendas there will be significant pressure on our political leaders to find a workable solution. City National Asset Management (“CNAM”) continues to closely monitor these events and plans to make necessary portfolio adjustments as the outcome becomes clearer.
| ORGANIZATIONAL CHANGES |
On July 2, 2012 City National Corporation announced the purchase of Rochdale Investment Management LLC of New York City. Rochdale will be merged with CNI Charter Funds adviser, City National Asset Management, Inc. The addition of the Rochdale investment professionals has opened up exciting opportunities, including the recently announced introduction of the new CNI Charter U.S. Core Equity Fund. We continue to work with the Rochdale investment team to combine their experience and talents with ours to enhance the management of CNI Charter Funds.
| FEE WAIVERS FOR MONEY MARKET FUNDS |
The Federal Reserve Bank Open Market Committee has announced its intention to maintain its low interest rate policy for short maturity funds into 2015. The purpose of this strategy is to keep borrowing costs low in order to stimulate credit demand and encourage investors to assume more risk. For money market investors it also means that yields on money market funds are likely to remain near zero for the foreseeable future. In order to protect the interests and preserve the capital of the CNI Charter Money Market Fund investors, CNAM has waived a substantial amount of its fees on these Funds since the financial crisis began in late 2008. The three Funds subject to this policy are the Prime, Government and California Tax Exempt Money Market Funds. This fee waiver has enabled all three Funds to produce positive, though modest, returns throughout the period.
As the adviser to CNI Charter Funds, CNAM proactively seeks to meet each of our mutual funds’ investment objectives through security research, continuous monitoring and re-evaluation of the portfolios holdings in a constantly changing market environment. CNAM maintains high standards of compliance review of our investment managers for each Fund.
Please read the following pages carefully as they contain important information on the assets and financial condition of the Funds. If you have any questions about this report you may call your investment professional or our toll-free number at (888) 889-0799.
Thank you for the confidence you place in CNI Charter Funds.
Sincerely,
Bruce Simon
Chief Investment Officer
CNI Charter Funds
Past performance is no guarantee of future results. Certain shareholders may be subject to the Alternative Minimum Tax (AMT). Federal income tax rules apply to any capital gain distributions.
Fund expenses have been waived during the period on which the performance is based. Without waivers, performance would be lower.
This information must be preceded or accompanied by a current prospectus. Please read the prospectus carefully before investing.
CNI CHARTER FUNDS | PAGE 3
| investment adviser’s report |
September 30, 2012 |
Money Market Funds |
Many of the same difficulties that confronted the short term markets in the last few years have continued. The perpetual uncertainty regarding the European debt crisis, downgrades of domestic and global financial institutions and continued low interest rates lead the list of issues that made it such a challenging period.
The European sovereign debt crisis reached perilous levels late last year forcing the European Central Bank to implement long-term financing operations that eventually calmed markets and provided needed liquidity. As the year progressed, political discussions among member countries presented financial markets with variable moments of salvation and stress. While European Union policymakers have addressed liquidity challenges and contagion issues, the longer-term solvency and economic stability remain a concern. Most money market participants continue to hold reduced exposure to European financials.
In June, Moody’s announced the downgrades of 15 banks and securities firms with global capital markets operations. The downgrades had little impact on the money markets, as all ratings remained Tier 1 (as defined by the Securities and Exchanges Commission’s Rule 2a-7 under the Investment Company Act of 1940), and the long interval between the announcement and actual downgrades gave us and the markets ample time to reposition portfolios.
Historically low interest rates continue to beleaguer short term markets and money market fund managers. The effective Federal Reserve (“Fed”) Funds target rate has remained at 0.00% to 0.25% since late 2008. In September the Federal Reserve pledged to keep the benchmark rate at a record low level until early 2015. The average money market fund continues to offer yields at or near 0.00%. As a result of this ultra low yield environment, nearly all money market fund advisers are waiving fees and absorbing a portion of expenses.
| FUND COMMENTARY |
| • | The Government Money Market Fund was positioned properly for Fed policy and market conditions that changed frequently throughout the year. The Fund has maintained a maturity profile of approximately 50 days average life in order to benefit from higher yielding securities in the face of continued low interest rates. City National Asset Management, Inc. (“CNAM”) waived the majority of its fees to produce a positive return of 0.01% for the year in the Institutional Class, Class N and Class S of this Fund. |
| • | The Prime Money Market Fund continues to focus on a well diversified strategy of high quality, liquid issuers. Due to continued uncertainty regarding European financial institutions with exposure to the sovereign debt crisis, the adviser decided that the Fund will not own their securities out of an abundance of caution. CNAM waived the majority of its fees to produce a positive return of 0.02% for the year in Institutional Class and 0.01% for the year in Class N and Class S. |
| • | The objective for the California Tax Exempt Money Market Fund continues to focus on the fundamental objective of principal preservation and liquidity. The yield curve for allowable money market securities remains relatively flat, the benefit gained generally outweighed by the risk of extending. Therefore, the average maturity of the portfolio remains short at 32 days. While the California economy has shown improvement, the adviser continues to carefully watch credit developments and remains very selective of the municipalities in which the Fund invests. Additionally, the adviser eliminated exposure to European bank liquidity providers for the Fund’s variable rate demand notes as the European credit crisis deepened. CNAM waived the majority of its fees to produce a return of 0.01% in the Institutional Class, Class N and Class S of the Fund. |
CNI CHARTER FUNDS | PAGE 4
| STRATEGIC OUTLOOK |
Due to the continued slow pace of the economic recovery and high levels of unemployment the Fed has pledged to keep rates at historically low levels for an extended period of time. The adviser considers the CNI Charter Money Market Funds to be appropriately positioned for the slow economic growth that is forecasted for the coming year. As always, City National Asset Management continues to monitor the objectives of the Funds very closely and seek opportunities in the markets to best serve the Funds’ shareholders.
Sincerely,
 |  |
| Gregory Kaplan | William Miller |
 | |
| Paul Single |
Directors of Fixed Income Investments
City National Asset Management, Inc.
This material represents the managers’ assessment of the portfolios and market environment at a specific point in time and should not be relied upon by the reader as research or investment advice.
CNI CHARTER FUNDS | PAGE 5
| investment adviser’s report |
September 30, 2012 |
Fixed Income and Blended Funds |
The first fiscal quarter of the year came at a peak in U.S. Treasury prices after the flight out of European sovereign debt drove investors to a safe haven. Early October 2011 showed the bond market at a high when both U.S. and foreign stock markets reached a bottom. As investors came out of the “risk-off” scenario and ventured back into non-safe haven securities, U.S. government securities began to sell-off and corporate and high yield bonds began to recover.
During the middle two fiscal quarters of 2012, equity and bond performance seemed eerily similar to that of 2011. Risk assets performed very well in the second fiscal quarter only to pull back in the third. Risk assets initially improved on the back of high levels of bullish optimism stemming from the announcement of European Central Bank’s (ECB) Long Term Refinancing Operation which quelled market fears of a near term European Union collapse. However, in late March the trend in U.S. economic data began to weaken with cautionary notes persisting into the summer. At the same time Europe dipped into recessionary conditions and China and major emerging market economies experienced a material slowdown in GDP growth rates. With the rose colored glasses removed, the global economic headwinds proved too much for the markets bullish sentiment resulting, once again, in a flight to quality into fixed income product with a bias towards U.S. Treasuries and Agencies.
Despite these woes, the last fiscal quarter proved positive for risk assets. Markets once again embraced a new ECB supportive/easing program, the Outright Monetary Transactions Programme, which is intended to keep European Sovereign debt yields relatively low via open market purchases. The market simply shrugged off relatively anemic domestic and global GDP growth rates, continued high levels of unemployment, “fiscal cliff” rumblings, a divisive Presidential election and continued unease in Europe. Oddly enough, improved U.S. housing data was a notable bright spot.
In late September the Fed announced a third round of quantitative easing which targets mortgage-backed securities in an effort to keep mortgage rates low to encourage GDP growth through home sales. The impact of the program is difficult to quantify at this time as it has only been in use for a short time period and its absolute size remains unknown given its open ended nature.
In spite of the ups and down from quarter to quarter, fixed income markets ended the fiscal year with positive, and in some cases above average, returns.
| LIMITED MATURITY FIXED INCOME FUND |
The objectives of the Limited Maturity Fixed Income Fund are to provide a high level of current income, consistent with the preservation of capital and liquidity. These objectives were achieved in the fiscal year under review. This Fund’s dual benchmarks are the BofA Merrill Lynch 3-Month U.S. Treasury Index, so risk averse yield oriented investors can compare the Fund’s returns to what economists call the “risk-free” return; and the BofA Merrill Lynch 1-3 Year U.S. Treasury Index as a total return short-maturity index. For the fiscal year the Institutional Class of the Fund returned 1.88% versus 0.56% for the BofA Merrill Lynch 1-3 Year U.S. Treasury Index and 0.07% for the BofA Merrill Lynch 3-Month U.S. Treasury Index.
The objective of providing a high level of income was demonstrated by outpacing both of the yield benchmarks; the Fund’s 30-day SEC yield at September 30, 2012 was 0.67%, compared to 0.25% for the BofA Merrill Lynch 1-3 Year U.S. Treasury Index, and 0.02% for BofA Merrill Lynch 3-Month U.S. Treasury Index. This kind of spread was maintained throughout the fiscal year. The Fund’s two largest sector weightings are high grade corporate and agency securities. At year end all the holdings in the Fund were rated single “A” or higher.
CNI CHARTER FUNDS | PAGE 6
| GOVERNMENT BOND FUND |
The Servicing Class of the Government Bond Fund produced a return of 1.15%. By comparison the Barclays Capital U.S. 1-5 Year Government Bond Index returned 1.33%. The Fund performed closely with the benchmark due to its overweight in agency-backed debt and collateralized mortgage obligations. By comparison, the Fund maintains a somewhat shorter duration versus the Barclays Capital U.S. 1-5 Year Government Bond Index in order to keep liquidity higher than normal to support shareholder activity.
| CORPORATE BOND FUND |
The Servicing Class of the Corporate Bond Fund produced a total annual net return of 5.89%, while the Barclays Capital U.S. Corporate 1-5 A3 or Higher, 2% Issuer Constrained Index returned 5.27%. The Fund maintains its positive stance on corporate credit quality while its overweight in lower quality (BBB) issues contributed to lower performance over the very volatile third quarter.
Continued positive domestic GDP growth (albeit slow) and tentatively positive news out of Europe are both supportive of credit quality. In addition, credit is expected to perform well in the near term given the relative values created with the sell-off in August and September.
| CALIFORNIA TAX EXEMPT BOND FUND |
The California Tax Exempt Bond Fund produced a total return of 4.59% for the Servicing Class, while the Barclays Capital CA Intermediate-Short Municipal Index returned 4.97%. By comparison the Lipper CA Short/Intermediate Municipal Objective median return was 3.68%. The first quarter of the fiscal year experienced a significant increase in market volatility due to the expiration of the Build America Bond Program combined with heightened credit fears. This set the market up for good returns late in the second fiscal quarter. Very limited bond supply and improving economic outlook helped to more than offset earlier weakness. This was followed by further strength in high quality bond markets due to the debt ceiling debate and ultimate downgrade of U.S. Treasury debt by Standard & Poor’s in August. The fiscal year wrapped up on a very strong note for the Fund as its high quality intermediate structure benefited from the acute concern of an imminent Greek default.
| FULL MATURITY FIXED INCOME FUND |
The Full Maturity Fixed Income Fund combines two portfolios designed to complement each other in the core + alpha strategy and to provide a “full” maturity spectrum.
| • | Boyd Watterson Asset Management, the alpha sub-adviser, manages its portfolio compared to the Barclays Capital U.S. Intermediate Government/Credit Bond Index, and will more aggressively move duration above or below its index by 20%; |
| • | Baird Advisors, the core sub-adviser, structures its portfolio compared to the Barclays Capital U.S. Aggregate Bond Index, and seeks to add value through sector selection while maintaining a neutral duration to the index. |
Following its investment objectives of providing a high level of current income, consistent with the preservation of capital, the Fund is broadly diversified in government and investment grade securities. The Fund began the fiscal year with a 60% tilt towards the intermediate portfolio, which was a defensive allocation in case of an interest rate increase in the first two quarters of the fiscal year.
By February the Federal Reserve had announced that interest rates were to remain at low levels for at least another 18 months (it has since been extended to mid-2015). It was determined that the higher yielding instruments, including corporate bonds and mortgage-backed securities, held in the aggregate portfolio would provide a better opportunity for investment income. The weighting of the Fund was changed to allocate 60% to the aggregate portfolio at that time. The Fund ended the fiscal year with 40.8% of the net assets in corporate bonds and 21.7% in U.S. government-backed mortgage obligations. Further, the Fund maintained a safe haven position of 18.8% in Treasuries and 7.7% in Agencies. The diversification among sectors for the Fund is designed to protect investors from any one sector’s risk, while maintaining a steady cashflow stream from the fixed income payments. The Fund invests in investment grade bonds only and has maintained an overall portfolio AA investment quality rating.
CNI CHARTER FUNDS | PAGE 7
| investment adviser’s report |
September 30, 2012 |
Fixed Income and Blended Funds (continued) |
The net return of the Fund’s Institutional Class was 5.11% for the fiscal year. This was higher than the Barclays Capital U.S. Intermediate Government/Credit Bond Index return of 4.40% for the period and tracked closely to the Barclays Capital U.S. Aggregate Bond Index return of 5.16%. The Lipper Corporate Debt Funds A-Rated Objective, which includes bond funds that are 100% weighted in corporate bonds, compared to the Fund’s 40.9% weighting, returned 7.71% for the fiscal year.
| HIGH YIELD BOND FUND |
The High Yield Bond Fund is sub-advised by Guggenheim Partners Investment Management, LLC. The first fiscal quarter was a time of recovery from the downswing investors experienced at the end of the previous fiscal year. High yield bonds are closely related to equity market returns and both began an upswing in tandem. Industrial sector bonds began the fiscal year with a 71.6% weight in the portfolio, and even as slower economic growth became apparent over the course of the fiscal year, the Fund experienced growth in returns as the sub-adviser increased investment in corporate Industrial bonds to 82.9% by fiscal year end. The Fund underweighted investments in the riskier Financials sector by minimizing bank sector bonds which ranged from an 8.2% allocation at the start of the fiscal year and decreased slightly to 7.7% at fiscal year end.
The net return of the Fund’s Servicing Class of 16.77% for the fiscal year tracked slightly below the Lipper High Current Yield Objective return for this category of 17.54% for the same period. By comparison, the Fund’s primary benchmark, the Citigroup High Yield Market Capped Index, was up 18.69% for the fiscal year (the “Market Capped” refers to the fact that no one security can comprise more than a 2% weighting of the index). The difference in return from the benchmark may be attributed in part to higher levels of cash and the sub-adviser taking a gradual approach to investing in late 2011 and early 2012, as new issuance of bonds in this category was low. The Fund’s portfolio managers have followed a strategy of buying the high yielding bonds of middle sized companies, rather than those of very large capitalized companies. Mid-sized company bonds tend to yield income at a higher rate than larger capitalization company bonds. There were 251 holdings at fiscal year end, which enables the portfolio to spread risk among more entities. The sub-adviser also invests in higher credit range, intermediate maturity bonds in an effort to avoid defaults in this category. It has been successful in meeting its objective of maximizing return in the high yield market.
| MULTI-ASSET FUND |
For the fiscal year, the Multi-Asset Fund’s Servicing Class returned 7.89%, beating the 4.73% median return for the Lipper Absolute Return Funds Classification peer group. Risk assets performed well, headlined by substantial gains in equity markets and Real Estate Investment Trusts (“REITs”). Fixed income markets also generated positive returns, with the higher yielding products leading the way.
Given the uncertainties in Europe, we liquidated the Fund’s position in developed international equities. The exposure to mid cap was also liquidated, leaving the Fund allocated exclusively to large cap focused funds. A greater emphasis has been placed on dividend paying stocks, as these provide enhanced yield and should offer some protection in the event of a market decline. During the year, the portfolio managers exited positions in individual short-term bonds, placing the proceeds into limited maturity fixed income funds. Also, a new position in a mutual fund that invests primarily in mortgage-backed securities was added and the Fund’s position in international bonds was reduced. We increased the allocation to real assets over the course of the year, initiating a position in domestic REITs and adding to gold.
CNI CHARTER FUNDS | PAGE 8
Sincerely,
 |  |
| Gregory Kaplan | William Miller |
 | |
| Paul Single |
Directors of Fixed Income Investments
City National Asset Management, Inc.
Timothy G. Solberg, CFA
Director of Sub-advised Funds
City National Asset Management, Inc.
This material represents the managers’ assessment of the portfolios and market environment at a specific point in time and should not be relied upon by the reader as research or investment advice.
CNI CHARTER FUNDS | PAGE 9
| fund overview |
September 30, 2012 |
Limited Maturity Fixed Income Fund |
The Fund seeks to provide a high level of current income, consistent with the preservation of capital and liquidity by investing primarily in fixed income securities either issued or guaranteed by the U.S. government or its agencies or instrumentalities, money market instruments and non-convertible fixed income securities of U.S. companies.
Comparison of Change in the Value of a $1,000,000 Investment in the Limited Maturity Fixed Income Fund, Institutional Class Shares, versus the BofA Merrill Lynch 1-3 Year U.S. Treasury Index and the BofA Merrill Lynch 3-Month U.S. Treasury Index(1)
| (1) | The performance in the above graph does not reflect the deduction of taxes the shareholder will pay on Fund distributions or the redemptions of Fund shares. Investment performance reflects fee waivers in effect. In the absence of such waivers, total return would be reduced. |
Past performance is no indication of future performance.
The Fund’s comparative benchmarks do not include the annual operating expenses incurred by the Fund. Please note that one cannot invest directly in an unmanaged index.
AVERAGE ANNUAL TOTAL RETURNS | ||||||
Shares | Ticker Symbol | 1-Year Return | 3-Year Return | 5-Year Return | 10-Year Return | Inception to Date |
Institutional Class*(1) | AHLFX | 1.88% | 2.02% | 3.38% | 2.91% | 4.86% |
Class N(2) | AHALX | 1.71% | 1.77% | 3.11% | 2.71% | 4.77% |
BofA Merrill Lynch 1-3 Year U.S. Treasury Index | n/a | 0.56% | 1.43% | 2.79% | 2.80% | 5.24% |
BofA Merrill Lynch 3-Month U.S. Treasury Index | n/a | 0.07% | 0.11% | 0.72% | 1.82% | 3.88% |
| * | The graph is based on only Institutional Class Shares; performance for Class N Shares would be different due to differences in fee structures. |
| (1) | Class I Shares of the predecessor to the Limited Maturity Fixed Income Fund (the “Predecessor Fund”) commenced operations on October 22, 1988. On September 30, 2005, the Predecessor Fund reorganized into the Fund. The performance results for Institutional Class Shares of the Fund for the period of October 22, 1988 to September 29, 2005, reflects the performance of the Predecessor Fund’s Class I Shares. |
| (2) | Class A Shares of the Predecessor Fund, the predecessor to the Class N Shares of the Fund, commenced operations on October 22, 2004. On September 30, 2005, the Predecessor Fund reorganized into the Fund. The performance results for Class N Shares of the Fund for the period of October 22, 2004, to September 29, 2005, reflects the performance of the Predecessor Fund’s Class A Shares. The performance results for Class N Shares of the Fund for the period of October 22, 1988 to October 21, 2004, reflects the performance of the Predecessor Fund’s Class I Shares. The performance of the Predecessor Fund’s Class I Shares has not been adjusted to reflect the higher Rule 12b-1 fees and expenses applicable to the Fund’s Class N Shares. If it had, the performance of the Fund’s Class N Shares would have been lower than that shown. |
| TOP TEN HOLDINGS* | |
| % OF PORTFOLIO | |
| FNMA | |
| 0.500%, 07/02/15 | 7.2% |
| FHLMC REMIC, Ser 2004-2825, Cl VP | |
| 5.500%, 06/15/15 | 6.2% |
| U.S. Treasury Note | |
| 0.250%, 06/30/14 | 4.5% |
| FNMA | |
| 5.000%, 03/15/16 | 3.7% |
| FHLMC | |
| 1.000%, 07/30/14 | 3.7% |
| FHLMC | |
| 4.375%, 07/17/15 | 3.6% |
| FHLMC | |
| 1.250%, 05/12/17 | 3.3% |
| Southern California, Public Power Authority, Ser B, RB, AGM, ETM | |
| 6.930%, 05/15/17 | 2.7% |
| U.S. Treasury Note | |
| 2.375%, 09/30/14 | 2.6% |
| Wachovia | |
| 5.750%, 06/15/17 | 2.4% |
| * | Excludes Cash Equivalents |
CNI CHARTER FUNDS | PAGE 10
| fund overview |
September 30, 2012 |
Government Bond Fund |
The Fund seeks to provide current income (as the primary component of a total return intermediate duration strategy) by investing primarily in securities either issued or guaranteed by the U.S. government or its agencies or instrumentalities.
Comparison of Change in the Value of a $10,000 Investment in the Government Bond Fund, Servicing Class Shares, versus the Barclays Capital U.S. 1-5 Year Government Bond Index(1)
| (1) | The performance in the above graph does not reflect the deduction of taxes the shareholder will pay on Fund distributions or the redemptions of Fund shares. Investment performance reflects fee waivers in effect. In the absence of such waivers, total return would be reduced. |
Past performance is no indication of future performance.
The Fund’s comparative benchmarks do not include the annual operating expenses incurred by the Fund. Please note that one cannot invest directly in an unmanaged index.
AVERAGE ANNUAL TOTAL RETURNS | ||||||
Shares | Ticker Symbol | 1-Year Return | 3-Year Return | 5-Year Return | 10-Year Return | Inception to Date |
Servicing Class*(1)^ | CNBIX | 1.15% | 2.45% | 3.47% | 3.01% | 4.30% |
Institutional Class(2)^^† | CNIGX | 1.41% | 2.54% | 3.53% | 3.04% | 4.32% |
Class N(3)†† | CGBAX | 0.99% | 2.22% | 3.23% | 2.79% | 3.98% |
Barclays Capital U.S. 1-5 Year Government Bond Index | n/a | 1.33% | 2.55% | 3.95% | 3.48% | 4.65% |
| * | The graph is based on only Servicing Class Shares; performance for Institutional Class and Class N Shares would be different due to differences in fee structures. |
| (1) | Commenced operations on January 14, 2000. |
| (2) | Commenced operations on February 1, 2012. |
| (3) | Commenced operations on April 13, 2000. |
| ^ | The Fund’s Servicing Class Shares are available only to fiduciary, advisory, agency, custodial and other similar accounts maintained at City National Bank. |
| ^^ | The Fund’s Institutional Class Shares are available only to fiduciary, advisory, agency, custodial and other similar accounts maintained at City National Bank which meet the Fund’s minimum initial investment requirement. |
| † | Institutional Class Shares’ performance for the period of January 14, 2000 to February 1, 2012 was calculated using the performance of the Servicing Class Shares adjusted to reflect the expenses of the Institutional Class Shares. If performance of the Servicing Class Shares had not been adjusted, the performance of the Institutional Class Shares for that period would have been lower because the expenses of the Institutional Class Shares are lower than those of the Servicing Class Shares. |
| †† | Class N Shares’ performance for the period of January 14, 2000 to April 13, 2000 was calculated using the performance of the Servicing Class Shares adjusted to reflect the expenses of the Class N Shares. If performance of the Servicing Class Shares had not been adjusted, the performance of the Class N Shares for that period would have been higher because the expenses of the Class N Shares are higher than those of the Servicing Class Shares. |
| TOP TEN HOLDINGS | |
| % OF PORTFOLIO | |
| Israel Government AID Bond | |
| 4.115%, 05/15/20 | 7.2% |
| Tennessee Valley Authority, Ser E | |
| 6.250%, 12/15/17 | 5.4% |
| Egypt Government AID Bond | |
| 4.450%, 09/15/15 | 4.7% |
| GNMA, Ser 2012-43, Cl HA | |
| 3.500%, 06/20/40 | 4.4% |
| FNMA REMIC, Ser 2011-99, Cl AV | |
| 4.000%, 08/25/24 | 4.3% |
| FHLB | |
| 0.683%, 04/08/14 | 4.3% |
| FHLMC, Ser 2012-4077, Cl BA | |
| 2.000%, 05/15/42 | 4.3% |
| FFCB | |
| 1.875%, 12/07/12 | 4.2% |
| FNMA REMIC, Ser 2012-32, Cl DE | |
| 3.000%, 12/25/26 | 4.2% |
| FHLMC REMIC, Ser 2011-3806, Cl UP | |
| 4.500%, 02/15/41 | 4.1% |
CNI CHARTER FUNDS | PAGE 11
| fund overview |
September 30, 2012 |
Corporate Bond Fund |
The Fund seeks to provide current income (as the primary component of a total return intermediate duration strategy) by investing in a diversified portfolio of fixed income securities, primarily investment grade corporate bonds issued by domestic and international companies denominated in U.S. dollars.
Comparison of Change in the Value of a $10,000 Investment in the Corporate Bond Fund, Servicing Class Shares, versus the Barclays Capital U.S. Corporate 1-5 A3 or Higher, 2% Issuer Constrained Index(1)
| (1) | The performance in the above graph does not reflect the deduction of taxes the shareholder will pay on Fund distributions or the redemptions of Fund shares. Investment performance reflects fee waivers in effect. In the absence of such waivers, total return would be reduced. |
Past performance is no indication of future performance.
The Fund’s comparative benchmarks do not include the annual operating expenses incurred by the Fund. Please note that one cannot invest directly in an unmanaged index.
AVERAGE ANNUAL TOTAL RETURNS | ||||||
Shares | Ticker Symbol | 1-Year Return | 3-Year Return | 5-Year Return | 10-Year Return | Inception to Date |
Servicing Class*(1)^ | CNCIX | 5.89% | 4.14% | 4.91% | 4.23% | 5.20% |
Class N(2)† | CCBAX | 5.62% | 3.87% | 4.66% | 3.98% | 4.91% |
Barclays Capital U.S. Corporate 1-5 A3 or Higher, 2% Issuer Constrained Index | n/a | 5.27% | 4.78% | 5.22% | 4.53% | 5.60% |
| * | The graph is based on only Servicing Class Shares; performance for Class N Shares would be different due to differences in fee structures. |
| (1) | Commenced operations on January 14, 2000. |
| (2) | Commenced operations on April 13, 2000. |
| ^ | The Fund’s Servicing Class Shares are available only to fiduciary, advisory, agency, custodial and other similar accounts maintained at City National Bank. |
| † | Class N Shares’ performance for the period of January 14, 2000 to April 13, 2000 was calculated using the performance of the Servicing Class Shares adjusted to reflect the expenses of the Class N Shares. If performance of the Servicing Class Shares had not been adjusted, the performance of the Class N Shares for that period would have been higher because the expenses of the Class N Shares are higher than those of the Servicing Class Shares. |
| TOP TEN HOLDINGS | |
| % OF PORTFOLIO | |
| Lowe's | |
| 6.100%, 09/15/17 | 2.7% |
| Caisse Centrale Desjardins du Quebec | |
| 2.650%, 09/16/15 | 2.3% |
| General Electric Capital | |
| 2.150%, 01/09/15 | 2.3% |
| Teva Pharmaceutical Finance IV | |
| 1.700%, 11/10/14 | 2.3% |
| VW Credit, MTN | |
| 1.875%, 10/13/16 | 2.3% |
| Total Capital International | |
| 1.500%, 02/17/17 | 2.3% |
| GNMA REMIC, Ser 2012-3, Cl AK | |
| 3.000%, 01/16/27 | 2.2% |
| JPMorgan Chase | |
| 6.000%, 10/01/17 | 2.1% |
| General Electric Capital, FDIC Insured, MTN | |
| 2.625%, 12/28/12 | 2.1% |
| American Express Credit, MTN | |
| 2.800%, 09/19/16 | 2.1% |
CNI CHARTER FUNDS | PAGE 12
| fund overview |
September 30, 2012 |
California Tax Exempt Bond Fund |
The Fund seeks to provide current income exempt from federal and California state income tax (as the primary component of a total return strategy) by investing primarily in California municipal bonds and notes.
Comparison of Change in the Value of a $10,000 Investment in the California Tax Exempt Bond Fund, Servicing Class Shares, versus the Barclays Capital CA Intermediate-Short Municipal Index and the Lipper CA Short/Intermediate Municipal Objective(1)
| (1) | The performance in the above graph does not reflect the deduction of taxes the shareholder will pay on Fund distributions or the redemptions of Fund shares. Investment performance reflects fee waivers in effect. In the absence of such waivers, total return would be reduced. |
Past performance is no indication of future performance.
The Fund’s comparative benchmarks do not include the annual operating expenses incurred by the Fund. Please note that one cannot invest directly in an unmanaged index.
AVERAGE ANNUAL TOTAL RETURNS | ||||||
Shares | Ticker Symbol | 1-Year Return | 3-Year Return | 5-Year Return | 10-Year Return | Inception to Date |
Servicing Class*(1)^ | CNTIX | 4.59% | 3.95% | 4.31% | 3.39% | 4.25% |
Class N(2)† | CCTEX | 4.32% | 3.68% | 4.03% | 3.14% | 4.01% |
Barclays Capital CA Intermediate-Short Municipal Index | n/a | 4.97% | 4.46% | 5.18% | 4.05% | 4.84% |
Lipper CA Short/Intermediate Municipal Objective | n/a | 3.68% | 2.86% | 3.44% | 3.01% | 3.66% |
| * | The graph is based on only Servicing Class Shares; performance for Class N Shares would be different due to differences in fee structures. |
| (1) | Commenced operations on January 14, 2000. |
| (2) | Commenced operations on April 13, 2000. |
| ^ | The Fund’s Servicing Class Shares are available only to fiduciary, advisory, agency, custodial and other similar accounts maintained at City National Bank. |
| † | Class N Shares’ performance for the period of January 14, 2000 to April 13, 2000 was calculated using the performance of the Servicing Class Shares adjusted to reflect the expenses of the Class N Shares. If performance of the Servicing Class Shares had not been adjusted, the performance of the Class N Shares for that period would have been higher because the expenses of the Class N Shares are higher than those of the Servicing Class Shares. |
| TOP TEN HOLDINGS* | |
| % OF PORTFOLIO | |
| Riverside County, Ser A, COP, AMBAC | |
| 5.000%, 11/01/17 | 3.1% |
| California State, GO | |
| Callable 03/01/15 @ 100 | |
| 5.000%, 03/01/16 | 2.8% |
| California State, GO | |
| 5.000%, 09/01/21 | 2.5% |
| Southern California, Public Power Authority, Subordinated Southern Transmission Project, Ser A, RB | |
| 5.000%, 07/01/17 | 2.4% |
| Orange County, Public Financing Authority, RB, NATL-RE | |
| 5.000%, 07/01/17 | 2.1% |
| California State, GO | |
| 5.000%, 09/01/20 | 2.1% |
| California State, GO | |
| Callable 11/01/20 @ 100 | |
| 5.000%, 11/01/22 | 2.1% |
| Los Angeles, Unified School District, Ser I, GO | |
| Callable 07/01/19 @ 100 | |
| 5.250%, 07/01/23 | 2.0% |
| San Francisco California Public Utilities Commission Water Revenue, Ser D, RB | |
| 4.000%, 11/01/19 | 2.0% |
| Modesto Irrigation District, Ser A, RB | |
| 5.000%, 07/01/17 | 2.0% |
| * | Excludes Cash Equivalent |
CNI CHARTER FUNDS | PAGE 13
| fund overview |
September 30, 2012 |
Full Maturity Fixed Income Fund |
The Fund seeks to provide a high level of current income, consistent with the preservation of capital by investing primarily in fixed income securities either issued or guaranteed by the U.S. government or its agencies or instrumentalities, money market instruments, non-convertible fixed income securities of U.S. companies and U.S. dollar-denominated debt obligations issued by foreign governments and corporations.
Comparison of Change in the Value of a $1,000,000 Investment in the Full Maturity Fixed Income Fund, Institutional Class Shares, versus the Barclays Capital U.S. Intermediate Government/Credit Bond Index, the Barclays Capital U.S. Aggregate Bond Index and the Lipper Corporate Debt Funds A-Rated Objective (1)
| (1) | The performance in the above graph does not reflect the deduction of taxes the shareholder will pay on Fund distributions or the redemptions of Fund shares. Investment performance reflects fee waivers in effect. In the absence of such waivers, total return would be reduced. |
Past performance is no indication of future performance.
The Fund’s comparative benchmarks do not include the annual operating expenses incurred by the Fund. Please note that one cannot invest directly in an unmanaged index.
AVERAGE ANNUAL TOTAL RETURNS | ||||||
Shares | Ticker Symbol | 1-Year Return | 3-Year Return | 5-Year Return | 10-Year Return | Inception to Date |
Institutional Class*(1) | AHFMX | 5.11% | 5.63% | 5.69% | 4.71% | 5.95% |
Class N(2) | AHAFX | 4.85% | 5.34% | 5.41% | 4.49% | 5.85% |
Barclays Capital U.S. Intermediate Government/Credit Bond Index | n/a | 4.40% | 5.18% | 5.71% | 4.76% | 6.65% |
Barclays Capital U.S. Aggregate Bond Index | n/a | 5.16% | 6.19% | 6.53% | 5.32% | 7.22% |
Lipper Corporate Debt Funds A-Rated Objective | n/a | 7.71% | 7.26% | 6.65% | 5.43% | 6.99% |
| * | The graph is based on only Institutional Class Shares; performance for Class N Shares would be different due to differences in fee structures. |
| (1) | Class I Shares of the predecessor to the Full Maturity Fixed Income Fund (the “Predecessor Fund”) commenced operations on October 20, 1988. On September 30, 2005, the Predecessor Fund reorganized into the Fund. The performance results for Institutional Class Shares of the Fund for the period of October 20, 1988 to September 29, 2005, reflects the performance of the Predecessor Fund’s Class I Shares. |
| (2) | Class A Shares of the Predecessor Fund, the predecessor to the Class N Shares of the Fund, commenced operations on May 11, 2004. On September 30, 2005, the Predecessor Fund reorganized into the Fund. The performance results for Class N Shares of the Fund for the period of May 11, 2004, to September 29, 2005, reflects the performance of the Predecessor Fund’s Class A Shares. The performance results for Class N Shares of the Fund for the period of October 20, 1988 to May 11, 2004, reflects the performance of the Predecessor Fund’s Class I Shares. The performance of the Predecessor Fund’s Class I Shares has not been adjusted to reflect the higher Rule 12b-1 fees and expenses applicable to the Fund’s Class N Shares. If it had, the performance of the Fund’s Class N Shares would have been lower than that shown. |
| TOP TEN HOLDINGS* | |
| % OF PORTFOLIO | |
| U.S. Treasury Bond | |
| 6.250%, 08/15/23 | 3.4% |
| U.S. Treasury Bond | |
| 4.375%, 02/15/38 | 2.7% |
| U.S. Treasury Note | |
| 2.375%, 07/31/17 | 2.4% |
| U.S. Treasury Bond | |
| 5.250%, 11/15/28 | 2.2% |
| U.S. Treasury Note | |
| 2.750%, 02/15/19 | 1.9% |
| FNMA | |
| 2.375%, 07/28/15 | 1.9% |
| FNMA | |
| 0.625%, 10/30/14 | 1.8% |
| U.S. Treasury Note | |
| 1.750%, 05/15/22 | 1.7% |
| FHLMC, Pool C03490 | |
| 4.500%, 08/01/40 | 1.7% |
| U.S. Treasury Note | |
| 0.875%, 07/31/19 | 1.6% |
| * | Excludes Cash Equivalents |
CNI CHARTER FUNDS | PAGE 14
| fund overview |
September 30, 2012 |
High Yield Bond Fund |
The Fund seeks to maximize total return by investing primarily in fixed income securities rated below investment grade including corporate bonds and debentures, convertible and preferred securities, zero coupon obligations and debt securities that are issued by U.S. and foreign governments and their agencies.
Comparison of Change in the Value of a $10,000 Investment in the High Yield Bond Fund, Servicing Class Shares, versus the Citigroup High Yield Market Capped Index and the Lipper High Current Yield Objective(1)
| (1) | The performance in the above graph does not reflect the deduction of taxes the shareholder will pay on Fund distributions or the redemptions of Fund shares. Investment performance reflects fee waivers in effect. In the absence of such waivers, total return would be reduced. |
Past performance is no indication of future performance.
The Fund’s comparative benchmarks do not include the annual operating expenses incurred by the Fund. Please note that one cannot invest directly in an unmanaged index.
AVERAGE ANNUAL TOTAL RETURNS | ||||||
Shares | Ticker Symbol | 1-Year Return | 3-Year Return | 5-Year Return | 10-Year Return | Inception to Date |
Servicing Class*(1)^ | CHYIX | 16.77% | 13.59% | 8.34% | 9.23% | 7.72% |
Institutional Class(2)^^† | CNIHX | 17.12% | 13.70% | 8.41% | 9.26% | 7.75% |
Class N(1) | CHBAX | 16.56% | 13.30% | 8.04% | 8.91% | 7.41% |
Citigroup High Yield Market Capped Index | n/a | 18.69% | 12.52% | 8.81% | 10.60% | 7.77% |
Lipper High Current Yield Objective | n/a | 17.54% | 11.37% | 7.08% | 9.23% | 6.19% |
| * | The graph is based on only Servicing Class Shares; performance for Institutional and Class N Shares would be different due to differences in fee structures. |
| (1) | Commenced operations on January 14, 2000. |
| (2) | Commenced operations on February 2, 2012. |
| ^ | The Fund’s Servicing Class Shares are available only to fiduciary, advisory, agency, custodial and other similar accounts maintained at City National Bank. |
| ^^ | The Fund’s Institutional Class Shares are available only to fiduciary, advisory, agency, custodial and other similar accounts maintained at City National Bank which meet the Fund’s minimum initial investment requirement. |
| † | Institutional Class Shares’ performance for the period of January 14, 2000 to February 2, 2012 was calculated using the performance of the Servicing Class Shares adjusted to reflect the expenses of the Institutional Class Shares. If performance of the Servicing Class Shares had not been adjusted, the performance of the Institutional Class Shares for that period would have been lower because the expenses of the Institutional Class Shares are lower than those of the Servicing Class Shares. |
| TOP TEN HOLDINGS* | |
| % OF PORTFOLIO | |
| Thermadyne Holdings | |
| 9.000%, 12/15/17 | 1.2% |
| Nuveen Investments | |
| 9.125%, 10/15/17 | 1.2% |
| First Data | |
| 8.750%, 01/15/22 | 1.1% |
| BreitBurn Energy Partners | |
| 7.875%, 04/15/22 | 1.1% |
| Exterran Holdings | |
| 7.250%, 12/01/18 | 1.1% |
| Burlington Coat Factory Warehouse | |
| 10.000%, 02/15/19 | 1.1% |
| Reynolds Group Issuer | |
| 6.875%, 02/15/21 | 1.1% |
| Central Garden and Pet | |
| 8.250%, 03/01/18 | 1.1% |
| Crestwood Midstream Partners | |
| 7.750%, 04/01/19 | 1.0% |
| Univision Communications | |
| 6.875%, 05/15/19 | 1.0% |
| * | Excludes Cash Equivalents |
CNI CHARTER FUNDS | PAGE 15
| fund overview |
September 30, 2012 |
Multi-Asset Fund |
The Fund seeks to generate a positive total return in excess of inflation in a manner consistent with capital preservation in all market environments by investing all or a substantial portion of its assets in other mutual funds or other types of funds like exchange-traded funds.
Comparison of Change in the Value of a $10,000 Investment in the Multi-Asset Fund, Servicing Class Shares, versus the Barclays Capital U.S. TIPS Index; a 60/40 hybrid of the following two indexes: the S&P 500 Index and the Barclays Capital U.S. Intermediate Government/Credit Index; the CPI + Annualized 500 basis points; and the Lipper Absolute Return Funds Classification(1)
| (1) | The performance in the above graph does not reflect the deduction of taxes the shareholder will pay on Fund distributions or the redemptions of Fund shares. Investment performance reflects fee waivers in effect. In the absence of such waivers, total return would be reduced. |
Past performance is no indication of future performance.
The Fund’s comparative benchmarks do not include the annual operating expenses incurred by the Fund. Please note that one cannot invest directly in an unmanaged index.
AVERAGE ANNUAL TOTAL RETURNS | ||||
Shares | Ticker Symbol | 1-Year Return | 3-Year Return | Inception to Date |
Servicing Class*(1)^ | CNLIX | 7.89% | 3.90% | 0.93% |
Institutional Class(2)^^† | CNIMX | 8.09% | 3.97% | 0.96% |
Class N(1) | CVEAX | 7.61% | 3.68% | 0.69% |
Barclays Capital U.S. TIPS Index | n/a | 9.10% | 9.29% | 7.93% |
| 60/40 hybrid of the following two indexes: | ||||
| S&P 500 Index | ||||
Barclays Capital U.S. Intermediate Government/Credit Index | n/a | 19.50% | 10.27% | 3.19% |
CPI + Annualized 500 basis points | n/a | 7.08% | 7.43% | 7.20% |
Lipper Absolute Return Funds Classification | n/a | 4.73% | 2.05% | -0.91% |
| * | The graph is based on only Servicing Class Shares; performance for Institutional and Class N Shares would be different due to differences in fee structures. |
| (1) | Commenced operations on October 1, 2007. |
| (2) | Commenced operations on March 22, 2012. |
| ^ | The Fund’s Servicing Class Shares are available only to fiduciary, advisory, agency, custodial and other similar accounts maintained at City National Bank. |
| ^^ | The Fund’s Institutional Class Shares are available only to fiduciary, advisory, agency, custodial and other similar accounts maintained at City National Bank which meet the Fund’s minimum initial investment requirement. |
| † | Institutional Class Shares’ performance for the period of October 1, 2007 to March 22, 2012 was calculated using the performance of the Servicing Class Shares adjusted to reflect the expenses of the Institutional Class Shares. If performance of the Servicing Class Shares had not been adjusted, the performance of the Institutional Class Shares for that period would have been lower because the expenses of the Institutional Class Shares are lower than those of the Servicing Class Shares. |
| TOP TEN HOLDINGS | |
| % OF PORTFOLIO | |
| Vanguard Short-Term Bond Index Fund | 21.3% |
| SPDR S&P 500 | 9.5% |
| CNI Corporate Bond Fund, Cl I | 7.1% |
| Principal Preferred Securities Fund | 6.8% |
| DoubleLine Total Return Bond Fund | 6.1% |
| Powershares DB Gold | 5.3% |
| CNI Limited Maturity Fixed Income Fund, Cl I | 5.3% |
| CNI Government Bond Fund, Cl I | 5.1% |
| Vanguard Dividend Appreciation | 4.7% |
| SPDR S&P Dividend | 4.7% |
CNI CHARTER FUNDS | PAGE 16
| investment adviser’s report |
September 30, 2012 |
Equity Funds |
| INVESTORS RETURN TO “RISK-ON” MODE |
The fiscal year began last October with the beginning of the recovery from the sharp downswing in share prices due to the twin crises of the U.S. debt ceiling stand-off in Washington and the possible default of European sovereign debt and its effects on banks with exposure to it. After compromises were reached in both arenas, even though the solutions were not long term, the U.S. stock markets began to climb and forecasts were for a moderate economic recovery in the United States even with a recession occurring in the European Monetary Union.
After a difficult spring that saw equity markets surrender most of the gains posted earlier in the fiscal year, a rally resumed in June and continued with little interruption through the end of the third quarter. The S&P 500 Stock Index returned 6.4% in the final fiscal quarter, extending its calendar year-to-date gain to an impressive 16.4%, and 30.2% for the fiscal year ended September 30. Other equity markets around the world also rallied late in the year, generating similar returns as the U.S. stock market in the final fiscal quarter. On a fiscal year basis, the United States remained among the leaders in stock market performance versus other large investable markets, demonstrated by the MSCI EAFE Index (which measures equity market performance of developed markets in Europe, Australasia and the Far East) fiscal year return of 13.75%. In general we anticipate that the U.S. economy will continue to support slow but steady growth but cannot remove the possibility of a black swan geopolitical or economic event from the near term time horizon.
The following section provides a brief synopsis of the equity funds in the CNI Charter Fund family with related performance for the fiscal year. Further information may be found on our website, cnicharterfunds.com.
| DIVERSIFIED EQUITY FUND |
The Diversified Equity Fund is split among three portfolio management teams to create a large/mid multi-cap blend portfolio. The Fund’s allocations are:
| • | 45% allocation to SKBA Capital Management LLC, a large/midcap value equity sub-adviser; |
| • | 30% allocation to Turner Investments L.P., an alpha large/midcap growth equity sub-adviser; |
| • | 25% allocation to City National Asset Management, the Fund’s investment adviser, which uses a customized, tobacco-free S&P 500 Index replication strategy to create the Fund’s core portfolio weighting. |
The index replication portion of the portfolio was added at the mid-point of the fiscal year; for the first half of the year the Fund was split between SKBA and Turner. The Fund’s Institutional Class shares produced returns of 22.75% this fiscal year. Lipper Analytics compares the Fund to its Multi-Cap Core Funds Classification, which had a median return of 25.79% for the year. The S&P 500 Index returned 30.20% for the period. At the beginning of the fiscal year the Fund’s combined sub-advisers matched the gains in the S&P 500 Index as it rose from its low point in October 2011. The Fund’s second fiscal quarter was also favorable as the Fund’s largest holding, Apple, comprising 4% of the Fund, led the Technology sector and the market upward. However, many of the Technology and Consumer Discretionary stocks reversed course in the next quarter, including the Facebook IPO, which was held in the Turner portfolio of the Fund.
At fiscal year-end the Fund’s portfolio was most heavily allocated to information technology companies, non-money center bank financial sector equities (insurance companies and regional banks) and Healthcare companies. Defensive sectors like Telecommunication Services, Consumer Staples and Utilities are underweighted. Overall the Fund’s portfolio reflects an expectation of continued U.S. economic growth in the near term.
| LARGE CAP VALUE EQUITY FUND |
Large cap value style stocks posted robust returns this fiscal year, as equities rallied off of the depressed lows reached at the beginning of October 2011. The Large Cap Value Equity Fund’s Servicing Class produced healthy gains of 26.57% over the fiscal year, compared to the 30.81% return of the
CNI CHARTER FUNDS | PAGE 17
| investment adviser’s report |
September 30, 2012 |
Equity Funds (continued) |
S&P 500 Value Index and 27.74% return of the Lipper Large Cap Value Funds Classification. The difference in returns is attributable in part to the adviser’s conservative strategy of structuring the portfolio with “deep” value characteristics which are more pronounced than those of the index. The strategy is designed with the intention to withstand the wide swings of market volatility and to provide growth in capital with less risk.
Solid results from the high dividend yielding Telecommunication Services, Consumer Staples and Utilities sectors were offset by lagging returns from companies owned in the Consumer Discretionary, Energy and Materials sectors as the U.S. economy slowed its rate of expansion. The latter half of the fiscal year proved more favorable to the style of the Fund as it generated a return of 3.34% over the volatile last six months of the fiscal period, topping both the Index’s 2.49% and the Lipper peer category’s 2.09%. At fiscal year end, with the three largest allocations a 25.4% weight in Financials (normally a heavy weighting in the value style), 11.0% in Energy and 10.4% in Industrials, the Fund remains largely sector neutral to the Index. There is slight underweight to Telecommunication Services, where securities were sold to realize profits.
| LARGE CAP GROWTH EQUITY FUND |
Large cap growth oriented stocks posted very strong returns during the fiscal year. For the fiscal year, the Large Cap Growth Equity Fund’s Servicing Class returned 30.43%, which exceeded the S&P 500 Growth Index and Lipper Large Cap Growth Funds Classification benchmarks of 29.65% and 27.19%, respectively, during the same period. During the fiscal period, the Healthcare, Information Technology, Consumer Staples and Consumer Discretionary sectors outperformed the benchmark, while Energy, Materials, Telecommunication Service, Financials and Industrials sectors trailed.
The Fund remains well diversified with exposure across all economic sectors and within major industry classifications. Holdings in the Information Technology sector comprised the largest allocation of the Fund at 28.3%, followed by Healthcare, Consumer Staples and Energy at 16.5%, 13.2% and 11.2%, respectively. Due to the current uncertain economic environment and diminished prospects for reaccelerating growth at fiscal year end, CNAM maintained a sector neutral strategy, preferring not to overweight or underweight sectors relative to the benchmark, but rather to add value through stock selection. The managers continue to employ a disciplined investment process focusing on higher quality companies with good earnings growth prospects and reasonable valuations.
| SOCIALLY RESPONSIBLE EQUITY FUND |
The Socially Responsible Equity Fund seeks to invest in companies that follow “ESG” (i.e., Environmental, Social and Governance) guidelines. It is sub-advised by SKBA Capital Management, a value style equity manager with long-term experience in ESG responsible investing. Besides seeking companies with favorable financial results and social worth, the Fund seeks to restrict investment companies which profit from activities that are not socially responsible, (including manufacturing tobacco-related products), showing poor product or employee safety records, or following unsound environmental practices. For the fiscal year, the Fund’s Institutional Class shares gained 21.63%. Lipper classifies the Fund in the Multi-Cap Value category, as it follows a large cap bias but holds up to 20% in middle sized capitalization companies. This Lipper classification had a 26.71% return for the fiscal year, but does not restrict investment in any stocks for socially responsible purposes. The MSCI KLD Social 400 Index, a socially responsible equity index, produced a return of 25.90% over the same period.
At September 30, 2012, the 50 holdings in this portfolio were biased towards value oriented stocks that will produce yields even in a slower economy. Heaviest sector weights were tilted towards non-money center bank Financials, including insurance companies, at 28.0%; Healthcare companies at 15.8%; 11.1% in Information Technology; and 10.4% each in Energy and Industrials. The sub-adviser chose to underweight Consumer Staples, Telecommunication Services and Utilities sectors.
CNI CHARTER FUNDS | PAGE 18
Sincerely,
Otis “Tres” Heald III
Director of Equity Investments
City National Asset Management, Inc.
Timothy G. Solberg, CFA
Director of Sub-advised Funds
City National Asset Management, Inc.
This material represents the managers’ assessment of the portfolios and market environment at a specific point in time and should not be relied upon by the reader as research or investment advice.
CNI CHARTER FUNDS | PAGE 19
| fund overview |
September 30, 2012 |
Diversified Equity Fund |
The Fund seeks to provide long-term capital growth by investing primarily in common stocks of large-capitalization U.S. companies that are diversified among various industries and market sectors.
Comparison of Change in the Value of a $1,000,000 Investment in the Diversified Equity Fund, Institutional Class Shares, versus the S&P 500 Index and the Lipper Multi-Cap Core Funds Classification(1)
| (1) | The performance in the above graph does not reflect the deduction of taxes the shareholder will pay on Fund distributions or the redemptions of Fund shares. Investment performance reflects fee waivers in effect. In the absence of such waivers, total return would be reduced. |
Past performance is no indication of future performance.
The Fund’s comparative benchmarks do not include the annual operating expenses incurred by the Fund. Please note that one cannot invest directly in an unmanaged index.
AVERAGE ANNUAL TOTAL RETURNS | ||||||
Shares | Ticker Symbol | 1-Year Return | 3-Year Return | 5-Year Return | 10-Year Return | Inception to Date |
Institutional Class*(1) | AHDEX | 22.75% | 7.83% | -2.08% | 6.21% | 8.83% |
Class N(2) | AHADX | 22.35% | 7.56% | -2.33% | 5.95% | 8.71% |
S&P 500 Index | n/a | 30.20% | 13.20% | 1.05% | 8.01% | 9.41% |
Lipper Multi-Cap Core Funds Classification | n/a | 25.79% | 10.50% | -0.07% | 8.03% | 8.98% |
| * | The graph is based on only Institutional Class Shares; performance for Class N Shares would be different due to differences in fee structures. |
| (1) | Class I Shares of the predecessor to the Diversified Equity Fund (the “Predecessor Fund”) commenced operations on October 20, 1988. On September 30, 2005, the Predecessor Fund reorganized into the Fund. The performance results for Institutional Class Shares of the Fund for the period of October 20, 1988 to September 29, 2005, reflects the performance of the Predecessor Fund’s Class I Shares. |
| (2) | Class A Shares of the Predecessor Fund, the predecessor to the Class N Shares of the Fund, commenced operations on December 30, 2002. On September 30, 2005, the Predecessor Fund reorganized into the Fund. The performance results for Class N Shares of the Fund for the period of December 30, 2002, to September 29, 2005, reflects the performance of the Predecessor Fund’s Class A Shares. The performance results for Class N Shares of the Fund for the period of October 20, 1988 to December 30, 2002, reflects the performance of the Predecessor Fund’s Class I Shares. The performance of the Predecessor Fund’s Class I Shares has not been adjusted to reflect the higher Rule 12b-1 fees and expenses applicable to the Fund’s Class N Shares. If it had, the performance of the Fund’s Class N Shares would have been lower than that shown. |
| TOP TEN HOLDINGS* | |
| % OF PORTFOLIO | |
| Apple | 4.0% |
| Tyco International | 1.5% |
| Berkshire Hathaway, Cl B | 1.5% |
| BB&T | 1.5% |
| PepsiCo | 1.4% |
| Cisco Systems | 1.4% |
| Brookfield Asset Management, Cl A | 1.4% |
| Google, Cl A | 1.3% |
| CareFusion | 1.3% |
| Microsoft | 1.3% |
| * | Excludes Cash Equivalents |
CNI CHARTER FUNDS | PAGE 20
| fund overview |
September 30, 2012 |
Large Cap Value Equity Fund |
The Fund seeks to provide capital appreciation and moderate income consistent with current returns available in the marketplace by investing in large U.S. corporations and U.S. dollar-denominated American Depositary Receipts of large foreign corporations which are undervalued.
Comparison of Change in the Value of a $10,000 Investment in the Large Cap Value Equity Fund, Servicing Class Shares, versus the S&P 500 Value Index and the Lipper Large Cap Value Funds Classification(1)
| (1) | The performance in the above graph does not reflect the deduction of taxes the shareholder will pay on Fund distributions or the redemptions of Fund shares. Investment performance reflects fee waivers in effect. In the absence of such waivers, total return would be reduced. |
Past performance is no indication of future performance.
The Fund’s comparative benchmarks do not include the annual operating expenses incurred by the Fund. Please note that one cannot invest directly in an unmanaged index.
AVERAGE ANNUAL TOTAL RETURNS | ||||||
Shares | Ticker Symbol | 1-Year Return | 3-Year Return | 5-Year Return | 10-Year Return | Inception to Date |
Servicing Class*(1)^ | CNLIX | 26.57% | 9.77% | -1.37% | 7.66% | 2.88% |
Institutional Class(2)^^† | CNILX | 26.82% | 9.84% | -1.33% | 7.69% | 2.89% |
Class N(3)†† | CVEAX | 26.18% | 9.47% | -1.62% | 7.39% | 2.62% |
S&P 500 Value Index | n/a | 30.81% | 11.39% | -1.56% | 7.79% | 3.13% |
Lipper Large Cap Value Funds Classification | n/a | 27.74% | 9.74% | -1.30% | 7.09% | 3.92% |
| * | The graph is based on only Servicing Class Shares; performance for Institutional and Class N Shares would be different due to differences in fee structures. |
| (1) | Commenced operations on January 14, 2000. |
| (2) | Commenced operations on February 1, 2012. |
| (3) | Commenced operations on April 13, 2000. |
| ^ | The Fund’s Servicing Class Shares are available only to fiduciary, advisory, agency, custodial and other similar accounts maintained at City National Bank. |
| ^^ | The Fund’s Institutional Class Shares are available only to fiduciary, advisory, agency, custodial and other similar accounts maintained at City National Bank which meet the Fund’s minimum initial investment requirement. |
| † | Institutional Class Shares’ performance for the period of January 14, 2000 to February 1, 2012 was calculated using the performance of the Servicing Class Shares adjusted to reflect the expenses of the Institutional Class Shares. If performance of the Servicing Class Shares had not been adjusted, the performance of the Institutional Class Shares for that period would have been lower because the expenses of the Institutional Class Shares are lower than those of the Servicing Class Shares. |
| †† | Class N Shares’ performance for the period of January 14, 2000 to April 13, 2000 was calculated using the performance of the Servicing Class Shares adjusted to reflect the expenses of the Class N Shares. If performance of the Servicing Class Shares had not been adjusted, the performance of the Class N Shares for that period would have been higher because the expenses of the Class N Shares are higher than those of the Servicing Class Shares. |
| TOP TEN HOLDINGS* | |
| % OF PORTFOLIO | |
| Wells Fargo | 2.7% |
| Microsoft | 2.7% |
| JPMorgan Chase | 2.7% |
| Wal-Mart Stores | 2.7% |
| General Electric | 2.6% |
| Berkshire Hathaway, Cl B | 2.5% |
| Exxon Mobil | 2.5% |
| AT&T | 2.4% |
| Chevron | 2.4% |
| Citigroup | 2.3% |
| * | Excludes Cash Equivalents |
CNI CHARTER FUNDS | PAGE 21
| fund overview |
September 30, 2012 |
Large Cap Growth Equity Fund |
The Fund seeks to provide capital appreciation by investing in large U.S. corporations and U.S. dollar-denominated American Depositary Receipts of large foreign corporations with the potential for growth.
Comparison of Change in the Value of a $10,000 Investment in the Large Cap Growth Equity Fund, Servicing Class Shares, versus the S&P 500 Growth Index and the Lipper Large Cap Growth Funds Classification(1)
| (1) | The performance in the above graph does not reflect the deduction of taxes the shareholder will pay on Fund distributions or the redemptions of Fund shares. Investment performance reflects fee waivers in effect. In the absence of such waivers, total return would be reduced. |
Past performance is no indication of future performance.
The Fund’s comparative benchmarks do not include the annual operating expenses incurred by the Fund. Please note that one cannot invest directly in an unmanaged index.
AVERAGE ANNUAL TOTAL RETURNS | ||||||
Shares | Ticker Symbol | 1-Year Return | 3-Year Return | 5-Year Return | 10-Year Return | Inception to Date |
Servicing Class*(1)^ | CNGIX | 30.43% | 11.32% | 2.19% | 6.69% | 0.03% |
Class N(2)† | CLEAX | 30.22% | 11.11% | 1.95% | 6.45% | -0.22% |
S&P 500 Growth Index | n/a | 29.65% | 14.93% | 3.55% | 8.14% | -0.06% |
Lipper Large Cap Growth Funds Classification | n/a | 27.19% | 11.96% | 1.40% | 7.34% | 0.01% |
| * | The graph is based on only Servicing Class Shares; performance for Class N Shares would be different due to differences in fee structures. |
| (1) | Commenced operations on January 14, 2000. |
| (2) | Commenced operations on March 28, 2000. |
| ^ | The Fund’s Servicing Class Shares are available only to fiduciary, advisory, agency, custodial and other similar accounts maintained at City National Bank. |
| † | Class N Shares’ performance for the period of January 14, 2000 to March 28, 2000 was calculated using the performance of the Servicing Class Shares adjusted to reflect the expenses of the Class N Shares. If performance of the Servicing Class Shares had not been adjusted, the performance of the Class N Shares for that period would have been higher because the expenses of the Class N Shares are higher than those of the Servicing Class Shares. |
| TOP TEN HOLDINGS | |
| % OF PORTFOLIO | |
| Apple | 11.3% |
| Exxon Mobil | 3.9% |
| Google, Cl A | 3.4% |
| Gilead Sciences | 3.4% |
| Qualcomm | 3.4% |
| CVS | 2.8% |
| DIRECTV | 2.6% |
| EMC | 2.6% |
| Mylan | 2.5% |
| Celgene | 2.4% |
CNI CHARTER FUNDS | PAGE 22
| fund overview |
September 30, 2012 |
Socially Responsible Equity Fund |
The Fund seeks to provide long-term capital growth by investing primarily in common stocks of U.S. issuers that meet certain socially responsible criteria.
Comparison of Change in the Value of a $1,000,000 Investment in the Socially Responsible Equity Fund, Institutional Class Shares, versus the MSCI KLD 400 Social Index and the Lipper Multi-Cap Value Funds Classification(1)
| (1) | The performance in the above graph does not reflect the deduction of taxes the shareholder will pay on Fund distributions or the redemptions of Fund shares. Investment performance reflects fee waivers in effect. In the absence of such waivers, total return would be reduced. |
Past performance is no indication of future performance.
The Fund’s comparative benchmarks do not include the annual operating expenses incurred by the Fund. Please note that one cannot invest directly in an unmanaged index.
AVERAGE ANNUAL TOTAL RETURNS | |||||
Shares | Ticker Symbol | 1-Year Return | 3-Year Return | 5-Year Return | Inception to Date |
Institutional Class*(1) | AHRAX | 21.63% | 8.34% | -1.31% | 2.26% |
Class N(2) | AHSRX | 21.28% | 8.06% | -1.57% | 2.02% |
MSCI KLD 400 Social Index | n/a | 25.90% | 11.41% | 1.31% | 3.88% |
Lipper Multi-Cap Value Funds Classification | n/a | 26.71% | 10.24% | -0.61% | 3.14% |
| * | The graph is based on only Institutional Class Shares; performance for Class N Shares would be different due to differences in fee structures. |
| (1) | Class I Shares of the predecessor to the Socially Responsible Equity Fund (the “Predecessor Fund”) commenced operations on January 3, 2005. On September 30, 2005, the Predecessor Fund reorganized into the Fund. The performance results for Institutional Class Shares of the Fund for the period of January 3, 2005 to September 29, 2005, reflects the performance of the Predecessor Fund’s Class I Shares. |
| (2) | Class A Shares of the Predecessor Fund, the predecessor to the Class N Shares of the Fund, commenced operations on August 12, 2005. On September 30, 2005, the Predecessor Fund reorganized into the Fund. The performance results for Class N Shares of the Fund for the period of August 12, 2005, to September 29, 2005, reflects the performance of the Predecessor Fund’s Class A Shares. The performance results for Class N Shares of the Fund for the period of January 3, 2005 to August 12, 2005, reflects the performance of the Predecessor Fund’s Class I Shares. The performance of the Predecessor Fund’s Class I Shares has not been adjusted to reflect the higher Rule 12b-1 fees and expenses applicable to the Fund’s Class N Shares. If it had, the performance of the Fund’s Class N Shares would have been lower than that shown. |
| TOP TEN HOLDINGS* | |
| % OF PORTFOLIO | |
| Brookfield Asset Management, Cl A | 3.3% |
| Abbott Laboratories | 3.0% |
| PepsiCo | 2.9% |
| Chubb | 2.9% |
| Laboratory Corp of America Holdings | 2.9% |
| Spectra Energy | 2.9% |
| ConocoPhillips | 2.9% |
| EI du Pont de Nemours | 2.7% |
| Arrow Electronics | 2.5% |
| Patterson | 2.5% |
| * | Excludes Cash Equivalent |
CNI CHARTER FUNDS | PAGE 23
| schedule of investments |
September 30, 2012 |
Government Money Market Fund |
Description | Face Amount (000) | Value (000) |
| U.S. Government Agency Obligations [45.4%] | ||||||||
| FAMC DN (A) | ||||||||
| 0.100%, 10/02/12 | $ | 5,000 | $ | 5,000 | ||||
| 0.160%, 11/06/12 | 22,000 | 21,996 | ||||||
| 0.160%, 11/08/12 | 30,000 | 29,995 | ||||||
| 0.170%, 11/27/12 | 20,000 | 19,995 | ||||||
| 0.155%, 11/29/12 | 25,000 | 24,994 | ||||||
| 0.135%, 12/21/12 | 20,000 | 19,994 | ||||||
| 2.060%, 01/02/13 | 38,689 | 38,672 | ||||||
| 0.196%, 02/01/13 | 50,000 | 49,966 | ||||||
| 0.170%, 03/01/13 | 25,000 | 24,982 | ||||||
| 0.170%, 03/08/13 | 25,000 | 24,981 | ||||||
| 0.190%, 03/25/13 | 30,000 | 29,972 | ||||||
| 0.220%, 04/01/13 | 12,927 | 12,913 | ||||||
| 0.180%, 04/23/13 | 10,000 | 9,990 | ||||||
| 0.203%, 05/10/13 | 70,000 | 69,913 | ||||||
| 0.190%, 06/10/13 | 25,000 | 24,967 | ||||||
| 0.185%, 06/21/13 | 40,000 | 39,946 | ||||||
| FFCB (B) | ||||||||
| 0.240%, 10/01/12 | 5,000 | 5,001 | ||||||
| 0.230%, 10/01/12 | 25,000 | 24,997 | ||||||
| 0.256%, 10/02/12 | 31,690 | 31,693 | ||||||
| 0.206%, 10/02/12 | 43,750 | 43,751 | ||||||
| 0.196%, 10/02/12 | 25,000 | 24,997 | ||||||
| 0.166%, 10/02/12 | 25,000 | 24,997 | ||||||
| 0.236%, 10/03/12 | 14,000 | 14,003 | ||||||
| 0.246%, 10/04/12 | 20,000 | 20,000 | ||||||
| 0.193%, 10/11/12 | 20,000 | 20,000 | ||||||
| 0.210%, 12/06/12 | 50,000 | 49,994 | ||||||
| 0.351%, 02/10/13 | 22,075 | 22,094 | ||||||
| FHLB | ||||||||
| 0.300%, 10/01/12(B) | 10,000 | 10,004 | ||||||
| 0.250%, 10/01/12(B) | 20,000 | 19,999 | ||||||
| 0.240%, 10/01/12(B) | 25,000 | 24,994 | ||||||
| 0.230%, 10/01/12(B) | 15,000 | 14,996 | ||||||
| 0.200%, 10/01/12(B) | 70,000 | 69,998 | ||||||
| 0.190%, 10/01/12(B) | 20,000 | 19,999 | ||||||
| 0.180%, 10/01/12(B) | 20,000 | 19,999 | ||||||
| 0.210%, 10/09/12(B) | 15,000 | 15,000 | ||||||
Description | Face Amount (000) | Value (000) |
| 0.224%, 12/12/12(B) | $ | 20,000 | $ | 20,000 | ||||
| 0.289%, 12/20/12(B) | 9,400 | 9,404 | ||||||
| 0.170%, 01/24/13 | 23,000 | 23,000 | ||||||
| 0.160%, 02/08/13 | 10,000 | 9,997 | ||||||
| 0.240%, 04/16/13 | 10,000 | 10,001 | ||||||
| 3.625%, 05/29/13 | 21,565 | 22,051 | ||||||
| 0.250%, 06/07/13 | 20,000 | 20,000 | ||||||
| 1.625%, 06/14/13 | 26,125 | 26,388 | ||||||
| 4.000%, 09/06/13 | 6,515 | 6,743 | ||||||
| FHLB DN | ||||||||
| 0.180%, 10/03/12(A) | 20,000 | 20,000 | ||||||
| FHLMC | ||||||||
| 0.375%, 11/30/12 | 25,000 | 25,008 | ||||||
| 0.750%, 03/28/13 | 15,000 | 15,038 | ||||||
| 4.125%, 09/27/13 | 11,808 | 12,262 | ||||||
| FHLMC DN (A) | ||||||||
| 0.159%, 10/01/12 | 80,873 | 80,873 | ||||||
| 0.140%, 10/22/12 | 20,000 | 19,998 | ||||||
| FNMA | ||||||||
| 0.350%, 10/01/12(B) | 15,000 | 15,004 | ||||||
| 4.750%, 11/19/12 | 11,432 | 11,502 | ||||||
| 3.875%, 07/12/13 | 31,414 | 32,297 | ||||||
| 0.500%, 08/09/13 | 6,500 | 6,517 | ||||||
| FNMA DN (A) | ||||||||
| 0.060%, 10/01/12 | 12,796 | 12,796 | ||||||
| 0.140%, 10/03/12 | 99,000 | 99,000 | ||||||
| 2.012%, 01/23/13 | 25,000 | 24,987 | ||||||
Total U.S. Government Agency Obligations (Cost $1,447,658) | 1,447,658 | |||||||
| U.S. Government Related Securities [15.7%] | ||||||||
| Straight-A Funding | ||||||||
| 0.190%, 10/17/12 | 25,000 | 24,998 | ||||||
| 0.180%, 10/02/12 | 65,000 | 65,000 | ||||||
| 0.180%, 10/09/12 | 64,253 | 64,250 | ||||||
| 0.180%, 10/10/12 | 54,358 | 54,356 | ||||||
| 0.180%, 10/25/12 | 23,075 | 23,072 | ||||||
| 0.180%, 10/26/12 | 50,000 | 49,994 | ||||||
| 0.180%, 10/30/12 | 17,148 | 17,145 | ||||||
| 0.180%, 11/05/12 | 54,026 | 54,017 | ||||||
| 0.180%, 11/06/12 | 30,076 | 30,071 | ||||||
| 0.180%, 11/07/12 | 3,250 | 3,249 | ||||||
| 0.180%, 11/26/12 | 25,000 | 24,993 | ||||||
| 0.180%, 12/03/12 | 40,453 | 40,440 | ||||||
| 0.180%, 12/04/12 | 50,000 | 49,984 | ||||||
Total U.S. Government Related Securities (Cost $501,569) | 501,569 | |||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 24
| schedule of investments |
September 30, 2012 |
Government Money Market Fund (continued) |
Description | Face Amount (000) | Value (000) |
| Municipal Bonds [4.7%] | ||||||||
| California [1.6%] | ||||||||
| Abag Finance Authority for Nonprofit, Ser A, RB, FNMA, AMT | ||||||||
| 0.170%, 10/04/12(B) (C) | $ | 15,000 | $ | 15,000 | ||||
| California Statewide, Communities Development Authority, Fairway Family Apartments Project, Ser PP, RB, FNMA, AMT | ||||||||
| 0.190%, 10/04/12(B) (C) | 8,000 | 8,000 | ||||||
| Los Angeles, Community Redevelopment Agency, Ser A, RB, FNMA, AMT | ||||||||
| 0.170%, 10/04/12(B) (C) | 15,450 | 15,450 | ||||||
| Sacramento County Housing Authority, Ser H, RB, FNMA, AMT | ||||||||
| 0.180%, 10/04/12(B) (C) | 9,000 | 9,000 | ||||||
Total California | 47,450 | |||||||
| New York [1.8%] | ||||||||
| New York State, Housing Finance Agency, West 38th Street, RB, FNMA, AMT | ||||||||
| 0.190%, 10/03/12(B) | 20,000 | 20,000 | ||||||
| New York State, Housing Finance Agency, 360 West 43rd Street, RB, FNMA, AMT | ||||||||
| 0.190%, 10/03/12(B) | 13,900 | 13,900 | ||||||
| New York State, Housing Finance Agency, 750 6th Avenue Project, RB, FNMA, AMT | ||||||||
| 0.190%, 10/03/12(B) | 5,800 | 5,800 | ||||||
| New York State, Housing Finance Agency, 316 11th Avenue Project, Ser A, RB, FNMA, AMT | ||||||||
| 0.190%, 10/03/12(B) | 19,000 | 19,000 | ||||||
Total New York | 58,700 | |||||||
| Texas [0.8%] | ||||||||
| Houston, Housing Finance, Regency Park Apartments Project, RB, FNMA, AMT | ||||||||
| 0.220%, 10/03/12(B) (C) | 13,695 | 13,695 |
Description | Face Amount (000) | Value (000) |
| Texas Department of Housing & Community Affairs, RB, FNMA, AMT | ||||||||
| 0.210%, 10/04/12(B) (C) | $ | 13,830 | $ | 13,830 | ||||
Total Texas | 27,525 | |||||||
| Washington [0.5%] | ||||||||
| Washington State, Housing Finance Commission, Vintage Spokane Project, Ser A, RB, FNMA, AMT | ||||||||
0.220%, 10/04/12(B) (C) | 16,295 | 16,295 | ||||||
Total Municipal Bonds (Cost $149,970) | 149,970 | |||||||
| Corporate Bonds [3.9%] | ||||||||
| Financial Services [1.1%] | ||||||||
| General Electric Capital, MTN | ||||||||
0.376%, 12/21/12(B) | 33,115 | 33,138 | ||||||
| Investment Banker/Broker Dealer [2.8%] | ||||||||
| Ally Financial | ||||||||
| 1.750%, 10/30/12 | 25,000 | 25,031 | ||||||
| 0.381%, 12/19/12(B) | 24,140 | 24,156 | ||||||
| Citigroup Funding | ||||||||
| 1.875%, 11/15/12 | 11,272 | 11,295 | ||||||
| JPMorgan Chase | ||||||||
| 0.617%, 12/26/12(B) | 31,525 | 31,567 | ||||||
Total Investment Banker/Broker Dealer | 92,049 | |||||||
Total Corporate Bonds (Cost $125,187) | 125,187 | |||||||
| U.S. Treasury Obligations [1.1%] | ||||||||
| U.S. Treasury Notes | ||||||||
| 0.625%, 04/30/13 | 20,000 | 20,048 | ||||||
| 1.375%, 05/15/13 | 15,000 | 15,108 | ||||||
Total U.S. Treasury Obligations (Cost $35,156) | 35,156 | |||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 25
| schedule of investments |
September 30, 2012 |
Government Money Market Fund (continued) |
Description | Face Amount (000) | Value (000) |
| Repurchase Agreements (D) [24.4%] | ||||||||
| Bank of America | ||||||||
| 0.150%, dated 09/28/12, repurchased on 10/01/12, repurchase price $175,002,188 (collateralized by various U.S. Government obligations, par valued ranging from $2,859,000 to $26,427,000, 0.000% to 5.625%, 02/01/13 to 07/15/37; with total market value $178,502,144) | $ | 175,000 | $ | 175,000 | ||||
| Barclays | ||||||||
| 0.200%, dated 09/28/12, repurchased 10/01/12, repurchase price $230,003,833 (collateralized by various U.S. Treasury obligations, par values ranging from $88,695,400 to $113,880,000, 0.250% to 4.500%, 06/30/14 to 05/15/38; with total market value $234,600,004) | 230,000 | 230,000 | ||||||
| Deutsche Bank | ||||||||
| 0.150%, dated 09/28/12, repurchased 10/01/12, repurchase price $200,002,500 (collateralized by various U.S. Treasury obligations, par values ranging from $67,045,100 to $135,900,400, 0.250% to 0.875%, 02/15/15 to 04/30/17; with total market value $204,000,033) | 200,000 | 200,000 | ||||||
| Deutsche Bank | ||||||||
| 0.200%, dated 09/28/12, repurchased 10/01/12, repurchase price $100,001,667 (collateralized by various U.S. Government obligations, par values ranging from $7,850,000 to $22,300,000, 0.500% to 5.270%, 11/20/15 to 05/01/29; with total market value $102,004,274) | 100,000 | 100,000 | ||||||
Description | Face Amount (000)/Shares | Value (000) | ||||||
| Goldman Sachs | ||||||||
| 0.180%, dated 09/28/12, repurchased 10/01/12, repurchase price $75,001,125 (collateralized by various U.S. Government obligations, par values ranging from $11,382,000 to $65,140,000, 0.178% to 0.190%, 09/25/13 to 01/06/14; with total market value $76,500,373) | $ | 75,000 | $ | 75,000 | ||||
Total Repurchase Agreements (Cost $780,000) | 780,000 | |||||||
| Short-Term Investments [4.8%] | ||||||||
| Fidelity Institutional Money Market Government Portfolio-III, Cl I, 0.010%* | 50,000,000 | 50,000 | ||||||
| Goldman Sachs Financial Square Funds - Treasury Obligations Fund, 0.010%* | 50,000,000 | 50,000 | ||||||
| Morgan Stanley Institutional Liquidity Funds - Government Portfolio, 0.050%* | 3,133,048 | 3,133 | ||||||
| Wells Fargo Advantage Government Money Market Fund, Cl I, 0.010%* | 50,000,000 | 50,000 | ||||||
Total Short-Term Investments (Cost $153,133) | 153,133 | |||||||
Total Investments [100.0%] (Cost $3,192,673) | $ | 3,192,673 | ||||||
| Percentages are based on Net Assets of $3,193,442 ($ Thousands). |
| * | The rate reported is the 7-day effective yield as of September 30, 2012. |
| (A) | Zero coupon security. The rate reported is the effective yield at time of purchase. |
| (B) | Floating Rate Security — The rate reported is the rate in effect on September 30, 2012. |
| (C) | Put and Demand Feature — The date reported is the next reset date or put date. |
| (D) | Tri-Party Repurchase Agreement. |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 26
| schedule of investments |
September 30, 2012 |
Government Money Market Fund (concluded) |
| AMT — Alternative Minimum Tax (subject to) |
| Cl — Class |
| DN — Discount Note |
| FAMC — Federal Agriculture Mortgage Corporation |
| FFCB — Federal Farm Credit Bank |
| FHLB — Federal Home Loan Bank |
| FHLMC — Federal Home Loan Mortgage Corporation |
| FNMA — Federal National Mortgage Association |
| MTN — Medium Term Note |
| RB — Revenue Bond |
| Ser — Series |
The following is a summary of the inputs used as of September 30, 2012 in valuing the Fund’s investments carried at value ($ Thousands):
| Investments in Securities | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| U.S. Government Agency Obligations | $ | — | $ | 1,447,658 | $ | — | $ | 1,447,658 | ||||||||
| U.S. Government Related Securities | — | 501,569 | — | 501,569 | ||||||||||||
| Municipal Bonds | — | 149,970 | — | 149,970 | ||||||||||||
| Corporate Bonds | — | 125,187 | — | 125,187 | ||||||||||||
| U.S. Treasury Obligations | — | 35,156 | — | 35,156 | ||||||||||||
| Repurchase Agreements | — | 780,000 | — | 780,000 | ||||||||||||
| Short-Term Investments | 153,133 | — | — | 153,133 | ||||||||||||
| Total Investments in Securities | $ | 153,133 | $ | 3,039,540 | $ | — | $ | 3,192,673 | ||||||||
For the period ended September 30, 2012, there have been no transfers between Level 1 and Level 2 assets and liabilities. Transfers, if any, between Levels are recognized at period end.
For more information on valuation inputs, see Note 2 — Significant Accounting Policies in the Notes to Financial Statements.
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 27
| schedule of investments |
September 30, 2012 |
Prime Money Market Fund |
Description | Face Amount (000) | Value (000) |
| Commercial Paper [45.8%] | ||||||||
| Air Transportation [1.7%] | ||||||||
| United Parcel Service (A) | ||||||||
0.030%, 10/02/12 | $ | 20,000 | $ | 20,000 | ||||
| Banks [20.9%] | ||||||||
| ANZ National Int'l (A) | ||||||||
| 0.441%, 01/11/13 | 6,000 | 5,992 | ||||||
| 0.331%, 02/27/13 | 15,000 | 14,979 | ||||||
| ASB Finance (A) | ||||||||
| 0.327%, 10/11/12 | 15,000 | 15,000 | ||||||
| 0.614%, 11/21/12 | 10,000 | 10,003 | ||||||
| Bank of Nova Scotia | ||||||||
| 0.125%, 10/03/12 | 10,000 | 10,000 | ||||||
| Bank of Tokyo-Mitsubishi UFJ NY | ||||||||
| 0.471%, 11/05/12 | 15,000 | 14,993 | ||||||
| 0.521%, 12/10/12 | 10,000 | 9,990 | ||||||
| BNZ International Funding (A) | ||||||||
| 0.350%, 10/02/12 | 10,000 | 10,000 | ||||||
| 0.496%, 10/28/12 | 15,000 | 15,000 | ||||||
| Commonwealth Bank of Australia | ||||||||
| 0.300%, 10/26/12(A) | 10,000 | 9,998 | ||||||
| Korea Development Bank NY | ||||||||
| 0.551%, 10/03/12 | 10,000 | 10,000 | ||||||
| 0.471%, 11/13/12 | 15,000 | 14,992 | ||||||
| 0.300%, 11/30/12 | 10,000 | 9,993 | ||||||
| National Australia Funding Delaware | ||||||||
| 0.285%, 02/19/13(A) | 7,087 | 7,079 | ||||||
| National Bank of Canada | ||||||||
| 0.351%, 01/07/13 | 10,000 | 9,990 | ||||||
| Sumitomo Corp of America | ||||||||
| 0.380%, 10/22/12 | 10,000 | 9,998 | ||||||
| 0.260%, 11/05/12 | 9,000 | 8,997 | ||||||
| Sumitomo Mitsui Banking | ||||||||
| 0.340%, 10/17/12(A) | 10,000 | 9,998 | ||||||
Description | Face Amount (000) | Value (000) |
| Sumitomo Mitsui Trust Bank Limited | ||||||||
| 0.340%, 11/20/12(A) | $ | 15,000 | $ | 14,993 | ||||
| Toronto-Dominion Holdings USA | ||||||||
| 0.240%, 10/22/12(A) | 10,000 | 9,999 | ||||||
| Westpac Securities NZ (A) | ||||||||
| 0.655%, 10/16/12 | 5,000 | 5,001 | ||||||
| 0.381%, 11/21/12 | 15,000 | 14,992 | ||||||
Total Banks | 241,987 | |||||||
| Computer System Design & Services [2.2%] | ||||||||
| Dell (A) | ||||||||
| 0.200%, 10/25/12 | 15,000 | 14,998 | ||||||
| 0.300%, 03/01/13 | 10,000 | 9,987 | ||||||
Total Computer System Design & Services | 24,985 | |||||||
| Financial Services [11.2%] | ||||||||
| Caisse Centrale Desjardins du Quebec (A) | ||||||||
| 0.200%, 10/09/12 | 20,000 | 19,999 | ||||||
| 0.200%, 10/12/12 | 5,000 | 5,000 | ||||||
| 0.210%, 12/12/12 | 10,000 | 9,996 | ||||||
| General Electric Capital | ||||||||
| 0.361%, 12/10/12 | 10,000 | 9,993 | ||||||
| 0.371%, 12/24/12 | 15,000 | 14,987 | ||||||
| 0.300%, 03/04/13 | 10,000 | 9,987 | ||||||
| Govco (A) | ||||||||
| 0.220%, 10/16/12 | 15,000 | 14,999 | ||||||
| 0.230%, 10/19/12 | 10,000 | 9,999 | ||||||
| Toyota Credit Canada | ||||||||
| 0.310%, 01/09/13 | 10,000 | 9,991 | ||||||
| Toyota Financial Services de Puerto Rico | ||||||||
| 0.331%, 02/06/13 | 15,000 | 14,982 | ||||||
| Toyota Motor Credit | ||||||||
| 0.391%, 11/01/12 | 10,000 | 9,997 | ||||||
Total Financial Services | 129,930 | |||||||
| Food, Beverage & Tobacco [0.9%] | ||||||||
| Nestle Capital | ||||||||
0.320%, 07/10/13(A) | 10,000 | 9,974 | ||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 28
| schedule of investments |
September 30, 2012 |
Prime Money Market Fund (continued) |
Description | Face Amount (000) | Value (000) |
| Import/Export [3.0%] | ||||||||
| Mitsui & USA | ||||||||
| 0.300%, 10/22/12 | $ | 15,000 | $ | 14,997 | ||||
| 0.360%, 11/01/12 | 10,000 | 9,997 | ||||||
| 0.285%, 12/05/12 | 10,000 | 9,994 | ||||||
Total Import/Export | 34,988 | |||||||
| Investment Banker/Broker Dealer [2.2%] | ||||||||
| AllianceBernstein (A) | ||||||||
| 0.491%, 10/16/12 | 15,000 | 14,997 | ||||||
| 0.511%, 12/06/12 | 10,000 | 9,991 | ||||||
Total Investment Banker/Broker Dealer | 24,988 | |||||||
| Petroleum & Fuel Products [2.4%] | ||||||||
| BP Capital Markets (A) | ||||||||
| 0.441%, 10/10/12 | 10,000 | 9,999 | ||||||
| 0.200%, 11/15/12 | 7,500 | 7,498 | ||||||
| 0.602%, 01/02/13 | 10,000 | 9,985 | ||||||
Total Petroleum & Fuel Products | 27,482 | |||||||
| Schools [1.3%] | ||||||||
| University of California | ||||||||
0.180%, 11/14/12 | 15,000 | 14,997 | ||||||
Total Commercial Paper (Cost $529,331) | 529,331 | |||||||
| Municipal Bonds [7.5%] | ||||||||
| California [2.2%] | ||||||||
| Los Angeles, Department of Water & Power, Ser B-3, RB | ||||||||
| 0.090%, 10/01/12(B) (E) | 14,740 | 14,740 | ||||||
| California State, Ser A-2, RB | ||||||||
| 2.500%, 06/20/13 | 10,000 | 10,148 | ||||||
Total California | 24,888 | |||||||
| Illinois [1.3%] | ||||||||
| Chicago, Midway Airport Authority, RB, AMT | ||||||||
0.220%, 10/01/12(B) (C) (E) | 14,500 | 14,500 | ||||||
| Massachusetts [1.1%] | ||||||||
| Massachusetts State, Health & Educational Facilities Authority, Ser N-4, RB | ||||||||
0.130%, 10/01/12(B) (C) (E) | 13,255 | 13,255 | ||||||
Description | Face Amount (000) | Value (000) |
| North Carolina [1.4%] | ||||||||
| Charlotte, Water and Sewer System, Ser B, RB | ||||||||
0.170%, 10/04/12(B) (E) | $ | 16,300 | $ | 16,300 | ||||
| Ohio [1.5%] | ||||||||
| Ohio State, Higher Educational Facility Commission, RB | ||||||||
0.120%, 10/01/12(B) (E) | 17,490 | 17,490 | ||||||
Total Municipal Bonds (Cost $86,433) | 86,433 | |||||||
| U.S. Government Related Securities [2.0%] | ||||||||
| Straight-A Funding | ||||||||
| 0.180%, 10/02/12 | 10,000 | 10,000 | ||||||
| 0.180%, 10/10/12 | 3,531 | 3,531 | ||||||
| 0.180%, 10/25/12 | 10,000 | 9,999 | ||||||
Total U.S. Government Related Securities (Cost $23,530) | 23,530 | |||||||
| U.S. Government Agency Obligations [2.0%] | ||||||||
| FAMC DN | ||||||||
| 0.100%, 10/02/12(D) | 10,000 | 10,000 | ||||||
| FHLB | ||||||||
| 0.200%, 10/01/12(B) | 10,000 | 10,000 | ||||||
| FHLMC DN | ||||||||
| 0.080%, 10/02/12(D) | 3,525 | 3,525 | ||||||
Total U.S. Government Agency Obligations (Cost $23,525) | 23,525 | |||||||
| Corporate Bonds [1.5%] | ||||||||
| Banks [1.5%] | ||||||||
| ANZ National Int'l | ||||||||
| 2.375%, 12/21/12(A) | 1,900 | 1,908 | ||||||
| National Australia Bank | ||||||||
| 0.512%, 11/04/12(B) | 15,000 | 15,000 | ||||||
Total Banks | 16,908 | |||||||
Total Corporate Bonds (Cost $16,908) | 16,908 | |||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 29
| schedule of investments |
September 30, 2012 |
Prime Money Market Fund (continued) |
Description | Face Amount (000)/Shares | Value (000) | ||||||
| Certificates of Deposit [21.6%] | ||||||||
| Banco Del Estado De Chile | ||||||||
| 0.670%, 10/03/12 | $ | 10,000 | $ | 10,000 | ||||
| 0.740%, 12/18/12 | 10,000 | 10,000 | ||||||
| 0.720%, 01/07/13 | 15,000 | 15,000 | ||||||
| Bank of America | ||||||||
| 0.220%, 10/01/12 | 10,000 | 10,000 | ||||||
| 0.200%, 10/15/12 | 10,000 | 10,000 | ||||||
| 0.200%, 10/17/12 | 15,000 | 15,000 | ||||||
| Bank of Montreal | ||||||||
| 0.130%, 10/05/12 | 15,000 | 15,000 | ||||||
| 0.300%, 12/04/12 | 10,000 | 10,000 | ||||||
| 0.355%, 01/02/13 | 10,000 | 10,000 | ||||||
| Bank of Nova Scotia | ||||||||
| 0.648%, 10/26/12 | 15,000 | 15,004 | ||||||
| 0.518%, 11/09/12 | 10,000 | 10,003 | ||||||
| Canadian Imperial Bank of Commerce NY | ||||||||
| 0.280%, 10/01/12 | 15,000 | 15,000 | ||||||
| 0.520%, 04/04/13 | 9,700 | 9,707 | ||||||
| Mitsubishi UFJ Financial | ||||||||
| 0.530%, 10/12/12 | 10,000 | 10,000 | ||||||
| National Australia Bank | ||||||||
| 0.500%, 11/16/12 | 10,000 | 10,002 | ||||||
| National Bank of Canada | ||||||||
| 0.287%, 11/09/12 | 15,000 | 15,000 | ||||||
| Norinchukin Bank | ||||||||
| 0.400%, 10/22/12 | 10,000 | 10,000 | ||||||
| 0.370%, 11/19/12 | 15,000 | 15,000 | ||||||
| 0.360%, 12/06/12 | 10,000 | 10,000 | ||||||
| Sumitomo Mitsui Banking | ||||||||
| 0.320%, 12/06/12 | 10,000 | 10,000 | ||||||
| Toronto-Dominion Bank | ||||||||
| 0.289%, 10/20/12 | 15,000 | 15,000 | ||||||
Total Certificates of Deposit (Cost $249,716) | 249,716 | |||||||
| Short-Term Investment [7.1%] | ||||||||
| SEI Daily Income Trust, Prime Obligation Fund, Cl A, 0.070%* | 82,449,045 | �� | 82,449 | |||||
Total Short-Term Investment (Cost $82,449) | 82,449 | |||||||
Description | Face Amount (000) | Value (000) |
| Repurchase Agreements (F)[12.5%] | ||||||||
| Bank of America | ||||||||
| 0.150%, dated 09/28/12, repurchased on 10/01/12, repurchase price $45,000,563 (collateralized by a U.S. Government obligation, par value $42,886,000, 4.424%, 04/01/26; with total market value $45,900,943) | $ | 45,000 | $ | 45,000 | ||||
| Barclays | ||||||||
| 0.200%, dated 09/28/12, repurchased on 10/01/12, repurchase price $25,000,417 (collateralized by a U.S. Treasury Note, par value $24,040,700, 2.125%, 02/29/16; with total market value $25,500,058) | 25,000 | 25,000 | ||||||
| Deutsche Bank | ||||||||
| 0.150%, dated 09/28/12, repurchased on 10/01/12, repurchase price $35,000,438 (collateralized by a U.S. Treasury obligation, par value $33,394,300, 3.125%, 02/15/42; with total market value $35,700,057) | 35,000 | 35,000 | ||||||
| 0.200%, dated 09/28/12, repurchased on 10/01/12, repurchase price $15,000,250 (collateralized by a U.S. Government obligation, par value $14,956,000, 4.625%, 10/25/12; with total market value $15,300,829) | 15,000 | 15,000 | ||||||
| Goldman Sachs | ||||||||
| 0.180%, dated 09/28/12, repurchased on 10/01/12, repurchase price $25,000,375 (collateralized by various U.S. Government obligations, ranging in par value $1,740,000 to $23,745,000, 0.000% to 0.240%, 11/30/12 to 08/09/13; with total market value $25,500,708) | 25,000 | 25,000 | ||||||
Total Repurchase Agreements (Cost $145,000) | 145,000 | |||||||
Total Investments [100.0%] (Cost $1,156,892) | $ | 1,156,892 | ||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 30
| schedule of investments |
September 30, 2012 |
Prime Money Market Fund (concluded) |
| Percentages are based on Net Assets of $1,156,824 ($ Thousands). |
| * | The rate reported is the 7-day effective yield as of September 30, 2012. |
| (A) | Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration normally to qualified institutions. On September 30, 2012, the value of these securities amounted to $312,364 ($ Thousands), representing 27.0% of the net assets of the Fund. |
| (B) | Floating Rate Security — The rate reported is the rate in effect on September 30, 2012. |
| (C) | Securities are held in conjunction with a letter of credit from a major bank or financial institution. |
| (D) | Zero coupon security. The rate reported is the effective yield at time of purchase. |
| (E) | Put and Demand Feature — The date reported is the next reset date or put date. |
| (F) | Tri-Party Repurchase Agreement. |
| AMT — Alternative Minimum Tax (subject to) |
| Cl — Class |
| DN — Discount Note |
| FAMC — Federal Agriculture Mortgage Corporation |
| FHLB — Federal Home Loan Bank |
| FHLMC — Federal Home Loan Mortgage Corporation |
| RB — Revenue Bond |
| Ser — Series |
The following is a list of the inputs used as of September 30, 2012 in valuing the Fund’s investments carried at value ($ Thousands):
| Investments in Securities | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| Commercial Paper | $ | — | $ | 529,331 | $ | — | $ | 529,331 | ||||||||
| Municipal Bonds | — | 86,433 | — | 86,433 | ||||||||||||
| U.S. Government Related Securities | — | 23,530 | — | 23,530 | ||||||||||||
| U.S. Government Agency Obligations | — | 23,525 | — | 23,525 | ||||||||||||
| Corporate Bonds | — | 16,908 | — | 16,908 | ||||||||||||
| Certificates of Deposit | — | 249,716 | — | 249,716 | ||||||||||||
| Short-Term Investment | 82,449 | — | — | 82,449 | ||||||||||||
| Repurchase Agreements | — | 145,000 | — | 145,000 | ||||||||||||
| Total Investments in Securities | $ | 82,449 | $ | 1,074,443 | $ | — | $ | 1,156,892 | ||||||||
For the period ended September 30, 2012, there have been no transfers between Level 1 and Level 2 assets and liabilities. Transfers between Levels are recognized at period end.
For more information on valuation inputs, see Note 2 — Significant Accounting Policies in the Notes to Financial Statements.
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 31
| schedule of investments |
September 30, 2012 |
California Tax Exempt Money Market Fund |
Description | Face Amount (000) | Value (000) |
| Municipal Bonds [84.9%] | ||||||||
| California [79.3%] | ||||||||
| Bay Area Toll Authority, Ser A-2, RB | ||||||||
| 0.160%, 10/04/12(A) (B) (C) | $ | 5,000 | $ | 5,000 | ||||
| Bay Area Toll Authority, Ser C-1, RB | ||||||||
| 0.180%, 10/04/12(A) (B) (C) | 23,350 | 23,350 | ||||||
| Bay Area Toll Authority, Ser C-1, RB | ||||||||
| 0.140%, 10/04/12(A) (B) (C) | 19,445 | 19,445 | ||||||
| Bay Area Toll Authority, Ser C-2, RB | ||||||||
| 0.140%, 10/04/12(A) (B) (C) | 4,190 | 4,190 | ||||||
| California Infrastructure & Economic Development Bank, Ser A, RB | ||||||||
| 0.120%, 10/01/12(A) (B) (C) | 3,450 | 3,450 | ||||||
| California Infrastructure & Economic Development Bank, Ser B, RB | ||||||||
| 0.120%, 10/01/12(A) (B) (C) | 11,500 | 11,500 | ||||||
| California State, Department of Water Resources, Ser RB, FGIC | ||||||||
| Pre-Refunded @ 100 | ||||||||
| 5.000%, 12/01/12(D) | 2,100 | 2,117 | ||||||
| California State, Economic Recovery Project, Ser C-1, GO | ||||||||
| 0.180%, 10/01/12(A) (B) (C) | 23,635 | 23,635 | ||||||
| California State, Health Facilities Financing Authority, RB | ||||||||
| 0.180%, 10/03/12(A) (B) (C) | 6,750 | 6,750 | ||||||
Description | Face Amount (000) | Value (000) |
| California State, Health Facilities Financing Authority, RB | ||||||||
| 0.140%, 10/03/12(A) (B) (C) | $ | 13,500 | $ | 13,500 | ||||
| California State, Health Facilities Financing Authority, Ser A, RB | ||||||||
| 0.180%, 10/03/12(A) (B) (C) | 1,800 | 1,800 | ||||||
| California State, Health Facilities Financing Authority, Ser B, RB | ||||||||
| 0.120%, 10/01/12(A) (B) (C) | 6,400 | 6,400 | ||||||
| California State, Health Facilities Financing Authority, Ser B, RB | ||||||||
| 0.170%, 10/03/12(A) (B) (C) | 15,955 | 15,955 | ||||||
| California State, Health Facilities Financing Authority, Ser C, RB | ||||||||
| 0.170%, 10/03/12(A) (B) (C) | 9,125 | 9,125 | ||||||
| California State, Health Facilities Financing Authority, Ser RB | ||||||||
| 0.167%, 10/03/12(A) (C) | 10,885 | 10,885 | ||||||
| California State, Infrastructure & Economic Development Authority, Pacific Gas & Electric Project, Ser D, RB | ||||||||
| 0.180%, 10/01/12(A) (B) (C) | 12,225 | 12,225 | ||||||
| California State, Kindergarten Project, Ser A-2, GO | ||||||||
| 0.160%, 10/01/12(A) (B) (C) | 7,950 | 7,950 | ||||||
| California State, Kindergarten Project, Ser A-3, GO | ||||||||
| 0.180%, 10/01/12(A) (B) (C) | 14,200 | 14,200 | ||||||
| California State, Kindergarten Project, Ser A-8, GO | ||||||||
| 0.160%, 10/04/12(A) (B) (C) | 10,400 | 10,400 | ||||||
| California State, Kindergarten Project, Ser B-5, GO | ||||||||
| 0.180%, 10/04/12(A) (B) (C) | 4,200 | 4,200 | ||||||
| California State, Municipal Finance Authority, RB | ||||||||
| 0.130%, 10/01/12(A) (C) | 9,550 | 9,550 | ||||||
| California State, Ser A-1, GO | ||||||||
| 0.150%, 10/03/12(A) (B) (C) | 5,000 | 5,000 | ||||||
| California State, Ser A-2, GO | ||||||||
| 0.160%, 10/01/12(A) (B) (C) | 5,100 | 5,100 | ||||||
| California State, Ser A-2, GO | ||||||||
| 0.140%, 10/03/12(A) (B) (C) | 7,000 | 7,000 | ||||||
| California State, Ser B-4, GO | ||||||||
| 0.170%, 10/03/12(A) (B) (C) | 15,000 | 15,000 | ||||||
| California State, Sub-Ser A, GO | ||||||||
| 0.140%, 10/03/12(A) (B) (C) | 1,500 | 1,500 |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 32
| schedule of investments |
September 30, 2012 |
California Tax Exempt Money Market Fund (continued) |
Description | Face Amount (000) | Value (000) |
| California Statewide, Communities Development Authority, Masters College Project, Ser A, RB | ||||||||
| 0.180%, 10/04/12(A) (B) (C) | $ | 3,000 | $ | 3,000 | ||||
| California Statewide, Communities Development Authority, Ser D, RB | ||||||||
| 0.180%, 10/03/12(A) (C) | 16,500 | 16,500 | ||||||
| California Statewide, Communities Development Authority, Ser RB | ||||||||
| 0.170%, 10/03/12(A) (C) | 5,000 | 5,000 | ||||||
| East Bay, Municipal Utility District, Ser A-1, RB | ||||||||
| 0.140%, 10/03/12(A) (C) | 23,905 | 23,905 | ||||||
| Eastern Municipal Water District, Ser C, COP | ||||||||
| 0.160%, 10/03/12(A) (C) | 3,200 | 3,200 | ||||||
| Eastern Municipal Water District, Ser D, COP | ||||||||
| 0.180%, 10/03/12(A) (C) | 22,375 | 22,375 | ||||||
| Elsinore Valley, Municipal Water District, Ser A, COP | ||||||||
| 0.170%, 10/03/12(A) (B) (C) | 3,335 | 3,335 | ||||||
| Elsinore Valley, Municipal Water District, Ser B, COP | ||||||||
| 0.170%, 10/03/12(A) (B) (C) | 14,400 | 14,400 | ||||||
| Glendale, Police Building Project, COP | ||||||||
| 0.210%, 10/04/12(A) (C) | 18,800 | 18,800 | ||||||
| Golden State Tobacco Securitization, RB, FGIC | ||||||||
| Pre-Refunded @ 100 | ||||||||
| 5.500%, 06/01/13(D) | 1,000 | 1,035 | ||||||
| Golden State Tobacco Securitization, Ser B, RB | ||||||||
| Pre-Refunded @ 100 | ||||||||
| 5.500%, 06/01/13(D) | 1,000 | 1,035 | ||||||
| Golden State Tobacco Securitization, Ser B, RB, AGM, | ||||||||
| Pre-Refunded @ 100 | ||||||||
| 5.000%, 06/01/13(D) | 1,040 | 1,073 | ||||||
| Golden State, Tobacco Settlement, Ser A-3, RB | ||||||||
| Pre-Refunded @ 100 | ||||||||
| 7.875%, 06/01/13(D) | 2,170 | 2,280 | ||||||
| Kern County, TRAN | ||||||||
| 2.500%, 06/28/13 | 10,000 | 10,168 | ||||||
| Los Angeles County, Metropolitan Transportation Authority, Ser A1, RB | ||||||||
| 0.190%, 10/04/12 (A) (C) | 1,040 | 1,040 |
Description | Face Amount (000) | Value (000) |
| Los Angeles County, Metropolitan Transportation Authority, Ser A2, RB | ||||||||
| 0.170%, 10/01/12(A) (C) | $ | 37,050 | $ | 37,050 | ||||
| Los Angeles Department of Water & Power, Sub-Ser A-8, RB | ||||||||
| 0.170%, 10/04/12(A) (C) | 3,000 | 3,000 | ||||||
| Los Angeles, Department of Water & Power, Ser A-3, RB | ||||||||
| 0.150%, 10/04/12(A) (C) | 2,500 | 2,500 | ||||||
| Los Angeles, Department of Water & Power, Ser B-2, RB | ||||||||
| 0.150%, 10/01/12(A) (C) | 10,400 | 10,400 | ||||||
| Los Angeles, Department of Water & Power, Ser B-3, RB | ||||||||
| 0.180%, 10/01/12(A) (C) | 5,860 | 5,860 | ||||||
| Los Angeles, Department of Water & Power, Ser B-4, RB | ||||||||
| 0.160%, 10/04/12(A) (C) | 14,075 | 14,075 | ||||||
| Los Angeles, Department of Water & Power, Sub-Ser B-6, RB | ||||||||
| 0.080%, 10/01/12(A) (C) | 2,600 | 2,600 | ||||||
| Metropolitan Water District of Southern California, Ser A-1, RB | ||||||||
| 0.180%, 10/04/12(A) (C) | 10,000 | 10,000 | ||||||
| Metropolitan Water District of Southern California, Ser A-2, RB | ||||||||
| 0.180%, 10/04/12(A) (C) | 11,000 | 11,000 | ||||||
| Metropolitan Water District of Southern California, Ser A-3, RB | ||||||||
| 0.180%, 10/04/12(A) (C) | 10,000 | 10,000 | ||||||
| Modesto, Water Revenue, Ser A, RB | ||||||||
| 0.190%, 10/04/12(A) (B) (C) | 4,800 | 4,800 | ||||||
| Newport Beach, Hoag Memorial Hospital Project, Ser C, RB | ||||||||
| 0.140%, 10/03/12(A) (C) | 14,200 | 14,200 | ||||||
| Orange County, Apartment Development Authority, Riverbend Apartments Project, Ser B, RB | ||||||||
| 0.190%, 10/04/12(A) (C) | 10,000 | 10,000 | ||||||
| Orange County, Water District Authority, Ser A, COP | ||||||||
| 0.180%, 10/03/12(A) (B) (C) | 25,350 | 25,350 | ||||||
| Riverside County, Public Facilities Authority, Ser C, COP | ||||||||
| 0.160%, 10/03/12(A) (B) (C) | 8,000 | 8,000 |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 33
| schedule of investments |
September 30, 2012 |
California Tax Exempt Money Market Fund (continued) |
Description | Face Amount (000) | Value (000) |
| Riverside County, Water Authority, Ser A, RB | ||||||||
| 0.230%, 10/04/12(A) (C) | $ | 5,000 | $ | 5,000 | ||||
| Sacramento County, Sanitation District Financing Authority, Ser E, RB | ||||||||
| 0.170%, 10/03/12(A) (B) (C) | 6,700 | 6,700 | ||||||
| San Bernardino County, Ser A, TRAN | ||||||||
| 2.000%, 06/28/13 | 4,000 | 4,053 | ||||||
| San Diego County, Regional Transportation Commission, Ser B, RB | ||||||||
| 0.200%, 10/04/12(A) (C) | 9,180 | 9,180 | ||||||
| San Diego County, Regional Transportation Commission, Ser D, RB | ||||||||
| 0.160%, 10/04/12(A) (C) | 7,890 | 7,890 | ||||||
| San Francisco City & County, Airports Commission, Ser 37C, RB | ||||||||
| 0.160%, 10/03/12(A) (B) (C) | 15,900 | 15,900 | ||||||
| Santa Barbara County, Ser A, RB | ||||||||
| 2.000%, 06/28/13 | 5,000 | 5,066 | ||||||
| Santa Clara County, Financing Authority, VMC Facility Replacement Project, Ser B, RB | ||||||||
| 0.190%, 10/03/12(A) (C) | 14,820 | 14,820 | ||||||
| Santa Clara Valley, Transportation Authority, Ser C, RB | ||||||||
| 0.180%, 10/04/12(A) (C) | 12,000 | 12,000 | ||||||
| Santa Clara Valley, Transportation Authority, Ser C, RB | ||||||||
| 0.150%, 10/04/12(A) (C) | 995 | 995 | ||||||
| Santa Clara Valley, Transportation Authority, Ser D, RB | ||||||||
| 0.150%, 10/04/12(A) (C) | 22,800 | 22,800 | ||||||
| Southern California Public Power Authority, RB | ||||||||
| 0.180%, 10/03/12(A) (B) (C) | 19,400 | 19,400 | ||||||
| Southern California, Public Power Authority, RB | ||||||||
| 0.170%, 10/03/12(A) (B) (C) | 8,900 | 8,900 | ||||||
| State of California, Ser A-2, RB | ||||||||
| 2.500%, 06/20/13 | 20,000 | 20,296 | ||||||
| University of California, Regents Medical Center, Ser B-1, RB | ||||||||
| 0.170%, 10/01/12(A) (C) | 12,565 | 12,565 |
Description | Face Amount (000) | Value (000) |
| Ventura County, TRAN | ||||||||
| 2.500%, 07/01/13 | $ | 5,000 | $ | 5,086 | ||||
Total California | 715,859 | |||||||
| Connecticut [0.1%] | ||||||||
| Connecticut State, Health & Educational Facility Authority, Yale University Project, Ser Y-2, RB | ||||||||
0.080%, 10/01/12(A) (C) | 1,200 | 1,200 | ||||||
| New York [2.8%] | ||||||||
| New York City, Municipal Water Finance Authority, RB | ||||||||
0.110%, 10/01/12(A) (C) | 25,010 | 25,010 | ||||||
| Texas [2.7%] | ||||||||
| Lower Neches Valley Authority Industrial Development, RB | ||||||||
| 0.120%, 10/01/12(A) (C) | 13,025 | 13,025 | ||||||
| Lower Neches Valley Authority Industrial Development, RB | ||||||||
| 0.120%, 10/01/12(A) (C) | 12,000 | 12,000 | ||||||
Total Texas | 25,025 | |||||||
Total Municipal Bonds (Cost $767,094) | 767,094 | |||||||
| Commercial Paper [10.7%] | ||||||||
| California [10.7%] | ||||||||
| California State, Department of Water Resources | ||||||||
| 0.160%, 10/04/12 | 4,871 | 4,871 | ||||||
| 0.150%, 10/10/12 | 6,600 | 6,600 | ||||||
| 0.140%, 10/10/12 | 5,763 | 5,763 | ||||||
| California State, Municipal Finance Authority | ||||||||
| 0.180%, 10/03/12 | 10,000 | 10,000 | ||||||
| City & County of San Francisco | ||||||||
| 0.160%, 12/05/12 | 15,234 | 15,234 | ||||||
| County of Orange | ||||||||
| 0.180%, 12/05/12 | 13,130 | 13,130 | ||||||
| Sacramento, Municipal Utility District | ||||||||
| 0.140%, 11/02/12 | 15,000 | 15,000 | ||||||
| San Diego, Water Authority | ||||||||
| 0.160%, 12/04/12 | 13,100 | 13,100 | ||||||
| San Francisco, Public Utilities Commission | ||||||||
| 0.170%, 10/18/12 | 5,800 | 5,800 |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 34
| schedule of investments |
September 30, 2012 |
California Tax Exempt Money Market Fund (concluded) |
Description | Face Amount (000) | Value (000) |
| Santa Clara Valley, Water District | ||||||||
| 0.160%, 12/05/12 | $ | 4,080 | $ | 4,080 | ||||
| University of California | ||||||||
| 0.150%, 11/06/12 | 3,400 | 3,400 | ||||||
Total California | ||||||||
Total Commercial Paper (Cost $96,978) | 96,978 | |||||||
Total Investments [95.6%] (Cost $864,072) | $ | 864,072 |
| Percentages are based on Net Assets of $904,167 ($ Thousands). |
| (A) | Put and Demand Feature — The date reported is the next reset or put date. |
| (B) | Securities are held in conjunction with a letter of credit from a major bank or financial institution. |
| (C) | Floating Rate Security — The rate reported is the rate in effect on September 30, 2012. |
| (D) | Pre-Refunded Security — The maturity date shown is the pre-refunded date. |
AGM — Assured Guaranty Municipal
COP — Certificate of Participation
FGIC — Financial Guaranty Insurance Company
GO — General Obligation
RB — Revenue Bond
Ser — Series
TRAN — Tax and Revenue Anticipation Note
As of September 30, 2012, all of the Fund’s investments are Level 2.
For the period ended September 30, 2012, there have been no transfers between Level 1 and Level 2 assets and liabilities. Transfers between Levels are recognized at period end.
For more information on valuation inputs, see Note 2 — Significant Accounting Policies in the Notes to Financial Statements.
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 35
| schedule of investments |
September 30, 2012 |
Limited Maturity Fixed Income Fund |
Description | Face Amount (000) | Value (000) |
| Corporate Bonds [33.6%] | ||||||||
| Banks [18.0%] | ||||||||
| ANZ National International | ||||||||
| 6.200%, 07/19/13 | $ | 625 | $ | 650 | ||||
| Bank of America | ||||||||
| 4.875%, 01/15/13 | 150 | 152 | ||||||
| Barclays Bank, MTN | ||||||||
| 2.110%, 03/10/17(A) | 545 | 556 | ||||||
| Citigroup | ||||||||
| 6.375%, 08/12/14 | 1,100 | 1,197 | ||||||
| Commonwealth Bank of Australia, MTN | ||||||||
| 0.897%, 10/28/13(A) (B) | 1,100 | 1,096 | ||||||
| Credit Suisse NY, MTN | ||||||||
| 5.000%, 05/15/13 | 1,100 | 1,129 | ||||||
| Goldman Sachs Group | ||||||||
| 5.125%, 01/15/15 | 1,100 | 1,183 | ||||||
| JPMorgan Chase | ||||||||
| 2.000%, 08/15/17 | 940 | 948 | ||||||
| Morgan Stanley | ||||||||
| 5.375%, 10/15/15 | 1,100 | 1,185 | ||||||
| Wachovia | ||||||||
| 5.750%, 06/15/17 | 1,100 | 1,319 | ||||||
Total Banks | 9,415 | |||||||
| Computer System Design & Services [0.6%] | ||||||||
| IBM | ||||||||
| 4.750%, 11/29/12 | 165 | 166 | ||||||
| 2.100%, 05/06/13 | 140 | 142 | ||||||
Total Computer System Design & Services | 308 | |||||||
| Financial Services [3.5%] | ||||||||
| Caterpillar Financial Services, MTN | ||||||||
| 1.625%, 06/01/17 | 545 | 556 | ||||||
Description | Face Amount (000) | Value (000) |
| General Electric Capital | ||||||||
| 2.950%, 05/09/16 | $ | 1,100 | $ | 1,163 | ||||
| John Deere Capital, MTN | ||||||||
| 5.250%, 10/01/12 | 150 | 150 | ||||||
Total Financial Services | 1,869 | |||||||
| Food, Beverage & Tobacco [4.6%] | ||||||||
| Anheuser-Busch InBev Worldwide | ||||||||
| 5.375%, 11/15/14 | 1,100 | 1,210 | ||||||
| Bottling Group | ||||||||
| 6.950%, 03/15/14 | 1,100 | 1,201 | ||||||
Total Food, Beverage & Tobacco | 2,411 | |||||||
| Investment Banker/Broker Dealer [2.2%] | ||||||||
| Merrill Lynch, MTN | ||||||||
5.000%, 01/15/15 | 1,100 | 1,182 | ||||||
| Oil, Gas & Consumable Fuels [2.5%] | ||||||||
| ConocoPhillips Canada Funding I | ||||||||
5.625%, 10/15/16 | 1,100 | 1,304 | ||||||
| Telephones & Telecommunications [2.2%] | ||||||||
| AT&T | ||||||||
2.400%, 08/15/16 | 1,100 | 1,163 | ||||||
Total Corporate Bonds (Cost $17,395) | 17,652 | |||||||
| U.S. Government Agency Obligations [31.3%] | ||||||||
| FHLB | ||||||||
| 0.375%, 11/27/13 | 1,000 | 1,002 | ||||||
| FHLMC | ||||||||
| 4.375%, 07/17/15 | 1,800 | 1,999 | ||||||
| 2.500%, 04/23/14 | 1,200 | 1,242 | ||||||
| 1.250%, 05/12/17 | 1,800 | 1,843 | ||||||
| 1.000%, 07/30/14 | 2,000 | 2,026 | ||||||
| 1.000%, 09/29/17 | 940 | 949 | ||||||
| FNMA | ||||||||
| 5.000%, 03/15/16 | 1,800 | 2,077 | ||||||
| 1.000%, 10/16/17 | 1,300 | 1,299 | ||||||
| 0.500%, 07/02/15 | 4,000 | 4,012 | ||||||
Total U.S. Government Agency Obligations (Cost $16,353) | 16,449 | |||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 36
| schedule of investments |
September 30, 2012 |
Limited Maturity Fixed Income Fund (continued) |
Description | Face Amount (000) | Value (000) |
| U.S. Government Mortgage-Backed Obligations [16.8%] | ||||||||
| FHLMC, Pool G12806 | ||||||||
| 5.500%, 09/01/22 | $ | 109 | $ | 118 | ||||
| FHLMC, Pool G18247 | ||||||||
| 5.000%, 04/01/23 | 70 | 75 | ||||||
| FHLMC, Pool G18251 | ||||||||
| 5.000%, 05/01/23 | 105 | 113 | ||||||
| FHLMC, Pool G18321 | ||||||||
| 4.500%, 08/01/24 | 56 | 61 | ||||||
| FHLMC, Pool J04241 | ||||||||
| 5.500%, 01/01/22 | 48 | 53 | ||||||
| FHLMC, Pool J04459 | ||||||||
| 5.000%, 03/01/22 | 61 | 65 | ||||||
| FHLMC, Pool J04508 | ||||||||
| 5.000%, 03/01/22 | 78 | 85 | ||||||
| FHLMC, Pool J07575 | ||||||||
| 5.000%, 04/01/23 | 58 | 63 | ||||||
| FHLMC REMIC, Ser 2004-2825, Cl VP | ||||||||
| 5.500%, 06/15/15 | 3,286 | 3,429 | ||||||
| FHLMC REMIC, Ser 2012-4077, Cl BA | ||||||||
| 2.000%, 05/15/42 | 537 | 538 | ||||||
| FNMA, Pool 837196 | ||||||||
| 5.500%, 02/01/21 | 126 | 138 | ||||||
| FNMA, Pool 933915 | ||||||||
| 4.500%, 06/01/23 | 108 | 117 | ||||||
| FNMA, Pool 961783 | ||||||||
| 4.500%, 02/01/23 | 119 | 129 | ||||||
| FNMA REMIC, Ser 2010-39, Cl PD | ||||||||
| 3.000%, 06/25/38 | 1,062 | 1,078 | ||||||
| FNMA REMIC, Ser 2011-79, Cl GC | ||||||||
| 2.000%, 12/25/22 | 663 | 678 | ||||||
| FNMA REMIC, Ser 2012-1, Cl AE | ||||||||
| 1.750%, 12/25/21 | 514 | 527 | ||||||
| FNMA REMIC, Ser 2012-56, Cl A | ||||||||
| 7.000%, 11/25/28 | 422 | 425 | ||||||
| GNMA, Ser 2012-3, Cl AK | ||||||||
| 3.000%, 01/16/27 | 1,055 | 1,114 | ||||||
Total U.S. Government Mortgage-Backed Obligations (Cost $8,732) | 8,806 | |||||||
Description | Face Amount (000) | Value (000) |
| U.S. Treasury Obligations [9.7%] | ||||||||
| U.S. Treasury Notes | ||||||||
| 4.250%, 08/15/15 | $ | 1,000 | $ | 1,112 | ||||
| 2.375%, 09/30/14 | 1,400 | 1,460 | ||||||
| 0.250%, 06/30/14 | 2,500 | 2,500 | ||||||
Total U.S. Treasury Obligations (Cost $5,007) | 5,072 | |||||||
| Municipal Bonds [3.9%] | ||||||||
| California [3.9%] | ||||||||
| Southern California, Public Power Authority, Ser B, RB, AGM, ETM | ||||||||
| 6.930%, 05/15/17 | 1,195 | 1,514 | ||||||
| University of California, RB | ||||||||
| 1.988%, 12/14/12(A) | 545 | 550 | ||||||
Total California | 2,064 | |||||||
Total Municipal Bonds (Cost $1,953) | 2,064 | |||||||
| Sovereign Debt [2.4%] | ||||||||
| Province of Ontario, Canada | ||||||||
| 1.875%, 11/19/12 | 125 | 125 | ||||||
| 1.600%, 09/21/16 | 1,100 | 1,138 | ||||||
Total Sovereign Debt (Cost $1,245) | 1,263 | |||||||
| Asset-Backed Securities [0.5%] | ||||||||
| Mercedes-Benz Auto Receivables Trust, Ser 2009-1, Cl A4 | ||||||||
| 2.430%, 03/15/16 | 165 | 166 | ||||||
| USAA Auto Owner Trust, Ser 2009-2, Cl A4 | ||||||||
| 2.530%, 07/15/15 | 115 | 116 | ||||||
Total Asset-Backed Securities (Cost $280) | 282 | |||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 37
| schedule of investments |
September 30, 2012 |
Limited Maturity Fixed Income Fund (concluded) |
Description | Shares | Value (000) | ||||||
| Short-Term Investments [7.5%] | ||||||||
CNI Government Money Market Fund, Cl I, 0.010% *† | 1,953,958 | $ | 1,954 | |||||
| SEI Daily Income Trust Government Fund, Cl A, 0.020% * | 1,953,958 | 1,954 | ||||||
Total Short-Term Investments (Cost $3,908) | 3,908 | |||||||
Total Investments [105.7%] (Cost $54,873) | $ | 55,496 | ||||||
Percentages are based on Net Assets of $52,488 ($ Thousands).
| * | The rate reported is the 7-day effective yield as of September 30, 2012. |
| † | Investment in Affiliate. |
| (A) | Floating Rate Security — The rate reported is the rate in effect on September 30, 2012. |
| (B) | Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration normally to qualified institutions. On September 30, 2012, the value of these securities amounted to $1,096 ($ Thousands), representing 2.1% of the net assets of the Fund. |
AGM — Assured Guarantee Municipal
Cl — Class
ETM — Escrowed to Maturity
FHLB — Federal Home Loan Bank
FHLMC — Federal Home Loan Mortgage Corporation
FNMA — Federal National Mortgage Association
GNMA — Government National Mortgage Association
MTN — Medium Term Note
RB — Revenue Bond
REMIC — Real Estate Mortgage Investment Conduit
Ser — Series
The following is a list of the inputs used as of September 30, 2012 in valuing the Fund’s investments carried at value ($ Thousands):
| Investments in Securities | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| Corporate Bonds | $ | — | $ | 17,652 | $ | — | $ | 17,652 | ||||||||
| U.S. Government Agency Obligations | — | 16,449 | — | 16,449 | ||||||||||||
| U.S. Government Mortgage-Backed Obligations | — | 8,806 | — | 8,806 | ||||||||||||
| U.S. Treasury Obligations | — | 5,072 | — | 5,072 | ||||||||||||
| Municipal Bonds | — | 2,064 | — | 2,064 | ||||||||||||
| Sovereign Debt | — | 1,263 | — | 1,263 | ||||||||||||
| Asset-Backed Securities | — | 282 | — | 282 | ||||||||||||
| Short-Term Investments | 3,908 | — | — | 3,908 | ||||||||||||
| Total Investments in Securities | $ | 3,908 | $ | 51,588 | $ | — | $ | 55,496 | ||||||||
For the year ended September 30, 2012, there have been no transfers between Level 1 and Level 2 assets and liabilities. Transfers between Levels are recognized at period end.
For more information on valuation inputs, see Note 2 — Significant Accounting Policies in the Notes to Financial Statements.
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 38
| schedule of investments |
September 30, 2012 |
Government Bond Fund |
Description | Face Amount (000) | Value (000) |
| U.S. Government Mortgage-Backed Obligations [50.9%] | ||||||||
| FHLB CMO, Ser 2008-1239, Cl I | ||||||||
| 4.805%, 08/20/15 | $ | 2,882 | $ | 3,054 | ||||
| FHLMC REMIC, Ser 2006-R009, Cl AJ | ||||||||
| 5.750%, 12/15/18 | 84 | 85 | ||||||
| FHLMC REMIC, Ser 2007-R012, Cl AB | ||||||||
| 5.500%, 12/15/20 | 289 | 290 | ||||||
| FHLMC REMIC, Ser 2010-3775, Cl MH | ||||||||
| 4.000%, 12/15/40 | 6,906 | 7,535 | ||||||
| FHLMC REMIC, Ser 2011-3805, Cl EK | ||||||||
| 4.000%, 06/15/40 | 5,559 | 5,855 | ||||||
| FHLMC REMIC, Ser 2011-3806, Cl UP | ||||||||
| 4.500%, 02/15/41 | 7,190 | 7,799 | ||||||
| FHLMC REMIC, Ser 2012-4020, Cl EJ | ||||||||
| 3.000%, 02/15/42 | 4,665 | 4,854 | ||||||
| FHLMC REMIC, Ser 2012-4077, Cl BA | ||||||||
| 2.000%, 05/15/42 | 8,024 | 8,048 | ||||||
| FNMA, Pool 735288 | ||||||||
| 5.000%, 03/01/35 | 6,320 | 6,939 | ||||||
| FNMA ARM | ||||||||
| 2.758%, 03/01/34(A) | 258 | 276 | ||||||
| FNMA REMIC, Ser 2011-144, Cl CE | ||||||||
| 1.250%, 06/25/35 | 1,505 | 1,502 | ||||||
| FNMA REMIC, Ser 2011-79, Cl GC | ||||||||
| 2.000%, 12/25/22 | 5,533 | 5,655 | ||||||
| FNMA REMIC, Ser 2011-99, Cl AV | ||||||||
| 4.000%, 08/25/24 | 7,513 | 8,155 | ||||||
| FNMA REMIC, Ser 2012-32, Cl DE | ||||||||
| 3.000%, 12/25/26 | 7,627 | 7,960 | ||||||
| FNMA REMIC, Ser 2012-56, Cl A | ||||||||
| 7.000%, 11/25/28 | 2,110 | 2,126 | ||||||
Description | Face Amount (000) | Value (000) |
| GNMA, Pool 329656 | ||||||||
| 8.000%, 08/15/22 | $ | 9 | $ | 11 | ||||
| GNMA, Pool 376533 | ||||||||
| 7.500%, 06/15/24 | 2 | 3 | ||||||
| GNMA, Pool 398660 | ||||||||
| 7.500%, 05/15/26 | 3 | 3 | ||||||
| GNMA, Pool 497411 | ||||||||
| 6.000%, 01/15/29 | 5 | 6 | ||||||
| GNMA, Pool 571376 | ||||||||
| 7.000%, 12/15/16 | 6 | 7 | ||||||
| GNMA, Pool 584992 | ||||||||
| 7.500%, 04/15/32 | 29 | 32 | ||||||
| GNMA, Ser 2012-43, Cl HA | ||||||||
| 3.500%, 06/20/40 | 7,864 | 8,367 | ||||||
| GNMA ARM (A) | ||||||||
| 1.750%, 04/20/35 | 377 | 393 | ||||||
| 1.625%, 08/20/35 | 78 | 80 | ||||||
| GNMA CMO, Ser 2010-87, Cl NE | ||||||||
| 3.000%, 09/20/38 | 6,480 | 6,738 | ||||||
| GNMA CMO, Ser 2010-99, Cl XJ | ||||||||
| 3.500%, 08/20/39 | 6,752 | 7,189 | ||||||
Total U.S. Government Mortgage-Backed Obligations (Cost $92,019) | 92,962 | |||||||
| U.S. Government Agency Obligations [42.4%] | ||||||||
| Egypt Government AID Bond | ||||||||
| 4.450%, 09/15/15 | 8,000 | 8,934 | ||||||
| FAMC, MTN | ||||||||
| 3.250%, 06/25/14 | 7,000 | 7,337 | ||||||
| FFCB | ||||||||
| 1.875%, 12/07/12 | 8,000 | 8,025 | ||||||
| FHLB | ||||||||
| 3.250%, 09/12/14 | 3,000 | 3,173 | ||||||
| 1.000%, 06/09/17 | 7,000 | 7,066 | ||||||
| 0.683%, 04/08/14(A) | 8,000 | 8,053 | ||||||
| FHLMC | ||||||||
| 1.000%, 09/29/17 | 4,000 | 4,041 | ||||||
| FNMA | ||||||||
| 1.000%, 10/16/17 | 7,000 | 6,994 | ||||||
| Israel Government AID Bond | ||||||||
| 4.115%, 05/15/20(B) | 15,528 | 13,626 | ||||||
| Tennessee Valley Authority, Ser E | ||||||||
| 6.250%, 12/15/17 | 8,000 | 10,197 | ||||||
Total U.S. Government Agency Obligations (Cost $73,928) | 77,446 | |||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 39
| schedule of investments |
September 30, 2012 |
Government Bond Fund (concluded) |
Description | Face Amount (000)/Shares | Value (000) | ||||||
| U.S. Treasury Obligations [5.3%] | ||||||||
| U.S. Treasury Notes | ||||||||
| 1.375%, 11/30/15 | $ | 5,500 | $ | 5,678 | ||||
| 1.250%, 02/15/14 | 4,000 | 4,056 | ||||||
Total U.S. Treasury Obligations (Cost $9,477) | 9,734 | |||||||
| Short-Term Investments [5.0%] | ||||||||
CNI Charter Government Money Market Fund, Cl I, 0.010%*† | 4,541,763 | 4,542 | ||||||
| SEI Daily Income Trust Government Fund, Cl A, 2.070%* | 4,541,763 | 4,542 | ||||||
Total Short-Term Investments (Cost $9,084) | 9,084 | |||||||
Total Investments [103.6%] (Cost $184,508) | $ | 189,226 | ||||||
Percentages are based on Net Assets of $182,593 ($ Thousands).
| * | The rate reported is the 7-day effective yield as of September 30, 2012. |
| † | Investment in Affiliate. |
| (A) | Floating Rate Security — The rate reported is the rate in effect on September 30, 2012. |
| (B) | Zero coupon security. The rate reported is the effective yield at time of purchase. |
AID — Agency for International Development
ARM — Adjustable Rate Mortgage
Cl — Class
CMO — Collateralized Mortgage Obligation
FAMC — Federal Agriculture Mortgage Corporation
FFCB — Federal Farm Credit Bank
FHLB — Federal Home Loan Bank
FHLMC — Federal Home Loan Mortgage Corporation
FNMA — Federal National Mortgage Association
GNMA — Government National Mortgage Association
MTN — Medium Term Note
REMIC — Real Estate Mortgage Investment Conduit
Ser — Series
The following is a summary of the inputs used as of September 30, 2012 in valuing the Fund’s investments carried at value ($ Thousands):
| Investments in Securities | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| U.S. Government Mortgage-Backed Obligations | $ | — | $ | 92,962 | $ | — | $ | 92,962 | ||||||||
| U.S. Government Agency Obligations | — | 77,446 | — | 77,446 | ||||||||||||
| U.S. Treasury Obligations | — | 9,734 | — | 9,734 | ||||||||||||
| Short-Term Investments | 9,084 | — | — | 9,084 | ||||||||||||
| Total Investments in Securities | $ | 9,084 | $ | 180,142 | $ | — | $ | 189,226 | ||||||||
For the period ended September 30, 2012, there have been no transfers between Level 1 and Level 2 assets and liabilities. Transfers between Levels are recognized at period end.
For more information on valuation inputs, see Note 2 — Significant Accounting Policies in the Notes to Financial Statements.
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 40
| schedule of investments |
September 30, 2012 |
Corporate Bond Fund |
Description | Face Amount (000) | Value (000) |
| Corporate Bonds [90.8%] | ||||||||
| Aerospace & Defense [1.5%] | ||||||||
| United Technologies | ||||||||
0.918%, 06/01/15(A) | $ | 2,000 | $ | 2,024 | ||||
| Banks [12.9%] | ||||||||
| Barclays Bank, MTN | ||||||||
| 2.110%, 03/10/17(A) | 1,950 | 1,989 | ||||||
| Citigroup | ||||||||
| 5.850%, 08/02/16 | 980 | 1,106 | ||||||
| 5.500%, 02/15/17 | 250 | 277 | ||||||
| Citigroup Funding, FDIC Insured | ||||||||
| 2.250%, 12/10/12 | 2,500 | 2,510 | ||||||
| Countrywide Financial | ||||||||
| 6.250%, 05/15/16 | 1,200 | 1,309 | ||||||
| Credit Suisse USA | ||||||||
| 5.500%, 08/15/13 | 1,250 | 1,301 | ||||||
| Deutsche Bank, MTN | ||||||||
| 3.875%, 08/18/14 | 853 | 896 | ||||||
| JPMorgan Chase | ||||||||
| 6.000%, 10/01/17 | 2,390 | 2,828 | ||||||
| JPMorgan Chase, FDIC Insured | ||||||||
| 2.125%, 12/26/12 | 2,500 | 2,512 | ||||||
| Nordea Bank | ||||||||
| 2.250%, 03/20/15(B) | 500 | 509 | ||||||
Description | Face Amount (000) | Value (000) |
| Wachovia Bank, MTN | ||||||||
| 4.800%, 11/01/14 | $ | 2,179 | $ | 2,343 | ||||
Total Banks | 17,580 | |||||||
| Communication & Media [1.0%] | ||||||||
| Comcast Cable Communications Holdings | ||||||||
| 8.375%, 03/15/13 | 160 | 166 | ||||||
| Time Warner Cable | ||||||||
| 5.850%, 05/01/17 | 1,000 | 1,191 | ||||||
Total Communication & Media | 1,357 | |||||||
| Computer System Design & Services [3.8%] | ||||||||
| Cisco Systems | ||||||||
| 5.500%, 02/22/16 | 1,250 | 1,452 | ||||||
| Dell | ||||||||
| 5.625%, 04/15/14 | 1,000 | 1,073 | ||||||
| 2.300%, 09/10/15 | 1,000 | 1,039 | ||||||
| Hewlett-Packard | ||||||||
| 6.125%, 03/01/14 | 1,470 | 1,567 | ||||||
Total Computer System Design & Services | 5,131 | |||||||
| Diversified Minerals [1.7%] | ||||||||
| Teck Resources | ||||||||
| 3.150%, 01/15/17 | 1,250 | 1,300 | ||||||
| 2.500%, 02/01/18 | 1,000 | 1,004 | ||||||
Total Diversified Minerals | 2,304 | |||||||
| Diversified Operations [2.1%] | ||||||||
| 3M, MTN | ||||||||
| 4.375%, 08/15/13 | 500 | 518 | ||||||
| Siemens Financieringsmaatschappij | ||||||||
| 5.750%, 10/17/16(B) | 2,000 | 2,356 | ||||||
Total Diversified Operations | 2,874 | |||||||
| Electric Utilities [1.8%] | ||||||||
| Commonwealth Edison | ||||||||
| 6.950%, 07/15/18 | 1,000 | 1,222 | ||||||
| Exelon | ||||||||
| 4.900%, 06/15/15 | 1,138 | 1,251 | ||||||
Total Electric Utilities | 2,473 | |||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 41
| schedule of investments |
September 30, 2012 |
Corporate Bond Fund (continued) |
Description | Face Amount (000) | Value (000) |
| Electrical Services [1.8%] | ||||||||
| Alabama Power | ||||||||
| 4.850%, 12/15/12 | $ | 1,380 | $ | 1,392 | ||||
| American Electric Power | ||||||||
| 5.250%, 06/01/15 | 986 | 1,074 | ||||||
Total Electrical Services | 2,466 | |||||||
| Financial Services [20.2%] | ||||||||
| Ally Financial, FDIC Insured | ||||||||
| 2.200%, 12/19/12 | 2,500 | 2,511 | ||||||
| American Express Credit, MTN | ||||||||
| 2.800%, 09/19/16 | 2,600 | 2,765 | ||||||
| Caisse Centrale Desjardins du Quebec | ||||||||
| 2.650%, 09/16/15(B) | 3,000 | 3,143 | ||||||
| CME Group | ||||||||
| 5.400%, 08/01/13 | 95 | 99 | ||||||
| Daimler Finance North America (B) | ||||||||
| 2.300%, 01/09/15 | 1,350 | 1,385 | ||||||
| 1.875%, 09/15/14 | 1,000 | 1,015 | ||||||
| Ford Motor Credit | ||||||||
| 8.000%, 12/15/16 | 1,000 | 1,195 | ||||||
| General Electric Capital | ||||||||
| 2.150%, 01/09/15 | 3,000 | 3,088 | ||||||
| General Electric Capital, FDIC Insured, MTN | ||||||||
| 2.625%, 12/28/12 | 2,770 | 2,787 | ||||||
| Harley-Davidson Financial Services, MTN | ||||||||
| 3.875%, 03/15/16(B) | 1,000 | 1,072 | ||||||
| HSBC Finance | ||||||||
| 5.250%, 04/15/15 | 1,250 | 1,350 | ||||||
| John Deere Capital, MTN | ||||||||
| 1.250%, 12/02/14 | 2,000 | 2,031 | ||||||
| Nissan Motor Acceptance, MTN | ||||||||
| 1.950%, 09/12/17(B) | 2,000 | 2,018 | ||||||
| VW Credit, MTN | ||||||||
| 1.875%, 10/13/16 | 3,000 | 3,033 | ||||||
Total Financial Services | 27,492 | |||||||
| Food, Beverage & Tobacco [3.6%] | ||||||||
| Anheuser-Busch InBev Worldwide | ||||||||
| 5.375%, 11/15/14 | 1,195 | 1,315 | ||||||
| Bottling Group | ||||||||
| 6.950%, 03/15/14 | 1,000 | 1,092 | ||||||
| 5.500%, 04/01/16 | 1,000 | 1,158 | ||||||
| 4.625%, 11/15/12 | 435 | 437 | ||||||
Description | Face Amount (000) | Value (000) |
| Dr Pepper Snapple Group | ||||||||
| 2.900%, 01/15/16 | $ | 1,000 | $ | 1,059 | ||||
Total Food, Beverage & Tobacco | 5,061 | |||||||
| Household Furniture & Fixtures [0.4%] | ||||||||
| Newell Rubbermaid | ||||||||
2.000%, 06/15/15 | 500 | 507 | ||||||
| Internet Security [0.7%] | ||||||||
| Symantec | ||||||||
2.750%, 09/15/15 | 1,000 | 1,034 | ||||||
| Investment Banker/Broker Dealer [5.4%] | ||||||||
| Goldman Sachs Group | ||||||||
| 5.625%, 01/15/17 | 1,700 | 1,874 | ||||||
| Jefferies Group | ||||||||
| 8.500%, 07/15/19 | 870 | 998 | ||||||
| Macquarie Group | ||||||||
| 6.000%, 01/14/20(B) | 2,000 | 2,143 | ||||||
| Morgan Stanley, MTN | ||||||||
| 6.250%, 08/28/17 | 2,000 | 2,269 | ||||||
Total Investment Banker/Broker Dealer | 7,284 | |||||||
| Medical Products & Services [2.3%] | ||||||||
| Teva Pharmaceutical Finance IV | ||||||||
1.700%, 11/10/14 | 3,000 | 3,069 | ||||||
| Metal-Copper [0.7%] | ||||||||
| Freeport-McMoRan Copper & Gold | ||||||||
1.400%, 02/13/15 | 1,000 | 1,007 | ||||||
| Petroleum & Fuel Products [9.7%] | ||||||||
| BP Capital Markets | ||||||||
| 5.250%, 11/07/13 | 2,000 | 2,103 | ||||||
| ConocoPhillips Canada Funding I | ||||||||
| 5.625%, 10/15/16 | 2,000 | 2,371 | ||||||
| Kinder Morgan Energy Partners | ||||||||
| 6.000%, 02/01/17 | 1,000 | 1,175 | ||||||
| Shell International Finance | ||||||||
| 3.250%, 09/22/15 | 2,500 | 2,701 | ||||||
| Spectra Energy | ||||||||
| 5.500%, 03/01/14 | 615 | 651 | ||||||
| Total Capital International | ||||||||
| 1.500%, 02/17/17 | 2,980 | 3,033 | ||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 42
| schedule of investments |
September 30, 2012 |
Corporate Bond Fund (continued) |
Description | Face Amount (000) | Value (000) |
| Transocean | ||||||||
| 6.000%, 03/15/18 | $ | 1,000 | $ | 1,168 | ||||
Total Petroleum & Fuel Products | 13,202 | |||||||
| Real Estate Investment Trusts [4.3%] | ||||||||
| HCP | ||||||||
| 5.650%, 12/15/13 | 500 | 528 | ||||||
| 5.625%, 05/01/17 | 500 | 567 | ||||||
| Health Care REIT | ||||||||
| 4.700%, 09/15/17 | 1,000 | 1,104 | ||||||
| Kimco Realty | ||||||||
| 6.875%, 10/01/19 | 1,080 | 1,324 | ||||||
| Simon Property Group | ||||||||
| 6.100%, 05/01/16 | 2,000 | 2,307 | ||||||
Total Real Estate Investment Trusts | 5,830 | |||||||
| Retail [7.7%] | ||||||||
| Kroger | ||||||||
| 5.500%, 02/01/13 | 450 | 457 | ||||||
| Lowe's | ||||||||
| 6.100%, 09/15/17 | 3,000 | 3,654 | ||||||
| McDonald's, MTN | ||||||||
| 0.750%, 05/29/15 | 1,000 | 1,010 | ||||||
| Penske Truck Leasing PTL Finance (B) | ||||||||
| 3.750%, 05/11/17 | 750 | 769 | ||||||
| 3.125%, 05/11/15 | 500 | 512 | ||||||
| Tesco | ||||||||
| 2.000%, 12/05/14(B) | 2,000 | 2,039 | ||||||
| Wal-Mart Stores | ||||||||
| 2.875%, 04/01/15 | 2,000 | 2,119 | ||||||
Total Retail | 10,560 | |||||||
| Telephones & Telecommunications [9.2%] | ||||||||
| AT&T | ||||||||
| 5.100%, 09/15/14 | 2,000 | 2,174 | ||||||
| 2.400%, 08/15/16 | 1,870 | 1,978 | ||||||
| Motorola Solutions | ||||||||
| 6.000%, 11/15/17 | 1,000 | 1,194 | ||||||
| Telefonica Emisiones | ||||||||
| 6.421%, 06/20/16 | 1,000 | 1,056 | ||||||
| Verizon Communications | ||||||||
| 5.550%, 02/15/16 | 2,195 | 2,540 | ||||||
| Vivendi | ||||||||
| 3.450%, 01/12/18(B) | 1,000 | 1,019 | ||||||
Description | Face Amount (000) | Value (000) |
| Vodafone Group | ||||||||
| 5.000%, 09/15/15 | $ | 2,250 | $ | 2,528 | ||||
Total Telephones & Telecommunications | 12,489 | |||||||
Total Corporate Bonds (Cost $118,850) | 123,744 | |||||||
| U.S. Government Mortgage-Backed Obligations [2.4%] | ||||||||
| FNMA REMIC, Ser 2002-56, Cl MC | ||||||||
| 5.500%, 09/25/17 | 209 | 226 | ||||||
| GNMA REMIC, Ser 2012-3, Cl AK | ||||||||
| 3.000%, 01/16/27 | 2,856 | 3,017 | ||||||
Total U.S. Government Mortgage-Backed Obligations (Cost $3,225) | 3,243 | |||||||
| Unaffiliated Registered Investment Company [1.9%] | ||||||||
| Vanguard High-Yield Corporate Fund | 427,350 | 2,573 | ||||||
Total Registered Investment Company (Cost $2,500) | 2,573 | |||||||
| Sovereign Debt [1.1%] | ||||||||
| Korea National Oil | ||||||||
| 2.875%, 11/09/15(B) | 1,000 | 1,040 | ||||||
| United Mexican States, MTN | ||||||||
| 5.875%, 01/15/14 | 450 | 476 | ||||||
Total Sovereign Debt (Cost $1,451) | 1,516 | |||||||
| U.S. Treasury Obligation [0.5%] | ||||||||
| U.S. Treasury Inflation Protection Security | ||||||||
| 2.000%, 01/15/14 | 620 | 647 | ||||||
Total U.S. Treasury Obligation (Cost $624) | 647 | |||||||
| Municipal Bond [0.1%] | ||||||||
| California [0.1%] | ||||||||
| California State, GO | ||||||||
| 5.700%, 11/01/21 | 185 | 209 | ||||||
Total Municipal Bond (Cost $188) | 209 | |||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 43
| schedule of investments |
September 30, 2012 |
Corporate Bond Fund (concluded) |
Description | Shares | Value (000) | ||||||
| Short-Term Investments [2.1%] | ||||||||
CNI Prime Money Market Fund, Cl I, 0.030%*† | 1,412,639 | $ | 1,413 | |||||
| SEI Daily Income Trust, Prime Obligation Fund, Cl A, 0.070%* | 1,412,639 | 1,413 | ||||||
Total Short-Term Investments (Cost $2,825) | 2,826 | |||||||
Total Investments [98.9%] (Cost $129,663) | $ | 134,758 | ||||||
Percentages are based on Net Assets of $136,322 ($ Thousands).
| * | The rate reported is the 7-day effective yield as of September 30, 2012. |
| † | Investment in Affiliate. |
| (A) | Floating Rate Security — The rate reported is the rate in effect on September 30, 2012. |
| (B) | Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration normally to qualified institutions. On September 30, 2012, the value of these securities amounted to $19,020 ($ Thousands), representing 14.0% of the net assets of the Fund. |
Cl — Class
FDIC Insured — Federal Depositary Insurance Corporation
FNMA — Federal National Mortgage Association
GNMA — Government National Mortgage Association
GO — General Obligation
MTN — Medium Term Note
REIT — Real Estate Investment Trust
REMIC — Real Estate Mortgage Investment Conduit
Ser — Series
The following is a summary of the inputs used as of September 30, 2012 in valuing the Fund’s investments carried at value ($ Thousands):
| Investments in Securities | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| Corporate Bonds | $ | — | $ | 123,744 | $ | — | $ | 123,744 | ||||||||
| U.S. Government Mortgage-Backed Obligations | — | 3,243 | — | 3,243 | ||||||||||||
| Unaffiliated Registered Investment Company | 2,573 | — | — | 2,573 | ||||||||||||
| Sovereign Debt | — | 1,516 | — | 1,516 | ||||||||||||
| U.S. Treasury Obligation | — | 647 | — | 647 | ||||||||||||
| Municipal Bond | — | 209 | — | 209 | ||||||||||||
| Short-Term Investments | 2,826 | — | — | 2,826 | ||||||||||||
| Total Investments in Securities | $ | 5,399 | $ | 129,359 | $ | — | $ | 134,758 | ||||||||
For the period ended September 30, 2012, there have been no transfers between Level 1 and Level 2 assets and liabilities. Transfers between Levels are recognized at period end.
For more information on valuation inputs, see Note 2 — Significant Accounting Policies in the Notes to Financial Statements.
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 44
| schedule of investments |
September 30, 2012 |
California Tax Exempt Bond Fund |
Description | Face Amount (000) | Value (000) |
| Municipal Bonds [99.0%] | ||||||||
| Arizona [1.4%] | ||||||||
| Arizona State, School Facilities Board, Ser C, COP, AGM | ||||||||
| Callable 09/01/14 @ 100 | ||||||||
5.000%, 09/01/15 | $ | 750 | $ | 805 | ||||
| California [93.2%] | ||||||||
| Azusa, Redevelopment Agency, Mortgage-Backed Securities Program, Ser A, RB, FNMA, ETM | ||||||||
| 6.875%, 10/01/12 | 200 | 200 | ||||||
| Bay Area, Infrastructure Financing Authority, State Payment Acceleration Project, RB, NATL-RE FGIC | ||||||||
| Callable 08/01/14 @ 100 | ||||||||
| 5.000%, 08/01/17 | 860 | 923 | ||||||
| California State Public Works Board, Ser G-1, RB | ||||||||
| Callable 10/01/19 @ 100 | ||||||||
| 5.250%, 10/01/23 | 250 | 291 | ||||||
| California State, Economic Recovery Authority, Ser A, GO, NATL-RE | ||||||||
| Callable 07/01/14 @ 100 | ||||||||
| 5.000%, 07/01/15 | 965 | 1,043 | ||||||
| California State, Economic Recovery Authority, Ser B, GO | ||||||||
| 4.000%, 07/01/23(A) | 750 | 792 | ||||||
Description | Face Amount (000) | Value (000) |
| California State, Educational Facilities Authority, Loyola Marymount, RB | ||||||||
| 4.000%, 10/01/13 | $ | 500 | $ | 517 | ||||
| California State, Educational Facilities Authority, Stanford University Project, Ser T-4, RB | ||||||||
| 5.000%, 03/15/14 | 350 | 374 | ||||||
| California State, GO | ||||||||
| Callable 03/01/15 @ 100 | ||||||||
| 5.000%, 03/01/16 | 1,500 | 1,654 | ||||||
| California State, GO | ||||||||
| Callable 11/02/12 @ 100 | ||||||||
| 5.000%, 02/01/18 | 175 | 176 | ||||||
| California State, GO | ||||||||
| 4.000%, 02/01/18 | 1,000 | 1,141 | ||||||
| California State, GO | ||||||||
| 5.000%, 09/01/20 | 1,000 | 1,223 | ||||||
| California State, GO | ||||||||
| 5.000%, 09/01/21(C) | 1,200 | 1,471 | ||||||
| California State, GO | ||||||||
| Callable 11/01/20 @ 100 | ||||||||
| 5.000%, 11/01/22 | 1,025 | 1,222 | ||||||
| California State, GO | ||||||||
| Callable 09/01/21 @ 100 | ||||||||
| 5.250%, 09/01/25 | 900 | 1,092 | ||||||
| California State, Health Facilities Financing Authority, Ser A, RB | ||||||||
| 5.000%, 10/01/15 | 450 | 505 | ||||||
| California State, Health Facilities Financing Authority, Ser A, RB | ||||||||
| 5.500%, 08/15/17 | 500 | 604 | ||||||
| California State, Health Facilities Financing Authority, Ser A, RB | ||||||||
| 5.000%, 07/01/18 | 500 | 585 | ||||||
| California State, Health Facilities Financing Authority, Ser A, RB | ||||||||
| 5.500%, 08/15/18 | 125 | 154 | ||||||
| California State, Health Facilities Financing Authority, Stanford Hospital, Ser A, RB | ||||||||
| Pre-Refunded @ 100 | ||||||||
| 5.000%, 11/15/13(B) | 1,000 | 1,053 | ||||||
| California State, Public Works Board, Department of Corrections-Administration Project, Ser A, RB, AMBAC | ||||||||
| Callable 11/02/12 @ 100 | ||||||||
| 5.250%, 03/01/18 | 155 | 155 |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 45
| schedule of investments |
September 30, 2012 |
California Tax Exempt Bond Fund (continued) |
Description | Face Amount (000) | Value (000) |
| California State, Public Works Board, Department of Corrections-State Prisons, Ser A, RB, AMBAC | ||||||||
| 5.000%, 12/01/19 | $ | 850 | $ | 943 | ||||
| California State, Public Works Board, Department of Mental Health Project, Ser A, RB | ||||||||
| 5.250%, 06/01/13 | 200 | 206 | ||||||
| California State, Public Works Board, Ser A, RB | ||||||||
| 4.000%, 04/01/17 | 500 | 555 | ||||||
| California State, Public Works Board, State Prisons, Ser C, RB | ||||||||
| 5.000%, 10/01/16 | 1,000 | 1,146 | ||||||
| California State, Public Works Board, University of California Project, Ser C-1, RB | ||||||||
| Callable 03/01/20 @ 100 | ||||||||
| 5.000%, 03/01/21 | 660 | 804 | ||||||
| California State, Public Works Board, University of California Research Project, Ser L, RB, NATL-RE | ||||||||
| Callable 11/01/15 @ 100 | ||||||||
| 5.250%, 11/01/16 | 1,000 | 1,147 | ||||||
| California Statewide, Communities Development Authority, Kaiser Permanente, Ser A, RB | ||||||||
| 5.000%, 04/01/19 | 200 | 238 | ||||||
| California Statewide, Communities Development Authority, Kaiser Permanente, Ser B, RB | ||||||||
| 3.900%, 08/01/31(A) | 625 | 659 | ||||||
| California Statewide, Communities Development Authority, Ser A, RB | ||||||||
| 5.000%, 08/15/18 | 200 | 240 | ||||||
| Carlsbad, Public Financing Authority, Municipal Golf Course Project, Ser A, RB, AMBAC | ||||||||
| 4.500%, 09/01/16 | 350 | 394 | ||||||
| Castaic Lake, Water Agency, 1999 Project, Ser A, COP, AMBAC | ||||||||
| Callable 08/01/16 @ 100 | ||||||||
| 5.000%, 08/01/22 | 275 | 306 | ||||||
| Castaic Lake, Water Agency, Water Systems Improvement Project, Ser A, COP, NATL-RE | ||||||||
| 7.000%, 08/01/13 | 300 | 315 |
Description | Face Amount (000) | Value (000) |
| El Camino, Hospital District, GO, NATL-RE | ||||||||
| Callable 02/01/17 @ 100 | ||||||||
| 5.000%, 08/01/20 | $ | 500 | $ | 552 | ||||
| El Dorado, Irrigation District, Ser A, RB, AGM | ||||||||
| 4.500%, 03/01/19 | 500 | 579 | ||||||
| Gilroy, Unified School District, GO | ||||||||
| 3.624%, 04/01/13(D) | 500 | 499 | ||||||
| Gilroy, Unified School District, GO, NATL-RE FGIC | ||||||||
| Callable 08/01/13 @ 100 | ||||||||
| 5.250%, 08/01/19 | 800 | 831 | ||||||
| Golden State, Tobacco Settlement, Enhanced-Asset Backed, Ser A, RB, AMBAC | ||||||||
| Callable 10/18/12 @ 100 | ||||||||
| 5.000%, 06/01/20 | 500 | 501 | ||||||
| Jefferson, Unified High School District, Ser A, GO, NATL-RE FGIC | ||||||||
| 5.000%, 08/01/14 | 200 | 212 | ||||||
| Los Angeles County Metropolitan Transportation Authority, RB | ||||||||
| Callable 07/01/19 @ 100 | ||||||||
| 5.000%, 07/01/23 | 350 | 424 | ||||||
| Los Angeles County, Metropolitan Transportation Authority, Proposition C, Ser A, RB, NATL-RE | ||||||||
| Callable 07/01/14 @ 100 | ||||||||
| 5.000%, 07/01/16 | 200 | 217 | ||||||
| Los Angeles County, Sanitation Districts Financing Authority, Capital Projects (District #14), Sub-Ser B, RB, NATL-RE FGIC | ||||||||
| 3.750%, 10/01/14 | 175 | 186 | ||||||
| Los Angeles, Department of Water & Power, Power Systems Project, Sub-Ser A-2, RB, AGM | ||||||||
| Callable 07/01/15 @ 100 | ||||||||
| 5.000%, 07/01/25 | 1,000 | 1,115 | ||||||
| Los Angeles, Municipal Improvement Authority, Capital Equipment, Ser A, RB | ||||||||
| 4.000%, 11/01/19 | 575 | 636 | ||||||
| Los Angeles, Municipal Improvement Authority, Central Library Project, Ser A, RB, NATL-RE | ||||||||
| Callable 11/02/12 @ 100 | ||||||||
| 5.500%, 06/01/18 | 500 | 502 |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 46
| schedule of investments |
September 30, 2012 |
California Tax Exempt Bond Fund (continued) |
Description | Face Amount (000) | Value (000) |
| Los Angeles, Municipal Improvement Authority, Real Property, Ser E, RB | ||||||||
| 5.000%, 09/01/15 | $ | 275 | $ | 306 | ||||
| Los Angeles, Municipal Improvement Authority, Ser C, RB | ||||||||
| 4.000%, 09/01/16 | 500 | 548 | ||||||
| Los Angeles, Unified School District, COP, AMBAC | ||||||||
| 5.000%, 10/01/12 | 750 | 750 | ||||||
| Los Angeles, Unified School District, Ser A-1, GO, NATL-RE | ||||||||
| Callable 07/01/14 @ 100 | ||||||||
| 5.000%, 07/01/17 | 165 | 179 | ||||||
| Los Angeles, Unified School District, Ser I, GO | ||||||||
| Callable 07/01/19 @ 100 | ||||||||
| 5.250%, 07/01/23 | 1,000 | 1,187 | ||||||
| Los Angeles, Wastewater Systems Authority, Ser A, RB | ||||||||
| 5.000%, 06/01/14 | 825 | 889 | ||||||
| Modesto Irrigation District, Ser A, RB | ||||||||
| 5.000%, 07/01/21 | 310 | 377 | ||||||
| Modesto, Irrigation District, Ser A, RB | ||||||||
| 5.000%, 07/01/17 | 1,000 | 1,173 | ||||||
| Mount San Antonio, Community College District, GO | ||||||||
| 3.280%, 05/01/15(D) | 635 | 621 | ||||||
| Mountain View School District Community Facilities District, GO, NATL-RE | ||||||||
| 1.997%, 08/01/16(D) | 100 | 91 | ||||||
| M-S-R Public Power Agency, Sub-Ser L, RB, AGM | ||||||||
| 5.000%, 07/01/18 | 500 | 595 | ||||||
| Orange County, Public Financing Authority, RB, NATL-RE | ||||||||
| 5.000%, 07/01/17 | 1,050 | 1,228 | ||||||
| Orange County, Sanitation District, Ser A, COP | ||||||||
| 3.000%, 02/01/17 | 500 | 552 | ||||||
| Port of Oakland, Ser B, RB, NATL-RE | ||||||||
| Callable 11/01/17 @ 100 | ||||||||
| 5.000%, 11/01/23 | 500 | 551 | ||||||
| Port of Oakland, Ser C, RB, NATL-RE | ||||||||
| 5.000%, 11/01/15 | 450 | 500 |
Description | Face Amount (000) | Value (000) |
| Riverside County, Ser A, COP, AMBAC | ||||||||
| 5.000%, 11/01/17 | $ | 1,600 | $ | 1,852 | ||||
| Sacramento, Area Flood Control Agency, Ser A, SAB, NATL-RE FGIC | ||||||||
| Callable 10/01/17 @ 100 | ||||||||
| 5.000%, 10/01/21 | 400 | 464 | ||||||
| Sacramento, City Financing Authority, EPA Building Project, Ser A, RB, AMBAC | ||||||||
| Callable 11/02/12 @ 100 | ||||||||
| 4.750%, 05/01/17 | 525 | 526 | ||||||
| Sacramento, Municipal Utility District, Ser T, RB, NATL-RE FGIC | ||||||||
| Pre-Refunded @ 100 | ||||||||
| 5.250%, 05/15/14(B) | 690 | 745 | ||||||
| Sacramento, Municipal Utility District, Ser T, RB, NATL-RE FGIC | ||||||||
| Callable 05/15/14 @ 100 | ||||||||
| 5.250%, 05/15/22 | 115 | 123 | ||||||
| Sacramento, Unified School District, Election of 2002, GO, NATL-RE | ||||||||
| Callable 07/01/15 @ 100 | ||||||||
| 5.000%, 07/01/18 | 300 | 332 | ||||||
| San Diego, Public Facilities Financing Authority Sewer Revenue, Ser A, RB | ||||||||
| Callable 05/15/20 @ 100 | ||||||||
| 5.250%, 05/15/24 | 500 | 614 | ||||||
| San Diego, Public Facilities Financing Authority, Ser B, RB | ||||||||
| 5.000%, 05/15/14 | 750 | 806 | ||||||
| San Francisco California Public Utilities Commission Water Revenue, Ser D, RB | ||||||||
| 4.000%, 11/01/19 | 1,000 | 1,175 | ||||||
| San Francisco California Public Utilities Commission Water Revenue, Sub-Ser A, RB | ||||||||
| 5.000%, 11/01/20 | 250 | 316 | ||||||
| San Francisco City & County, Airports Commission, Ser B, RB | ||||||||
| 5.000%, 05/01/17 | 495 | 579 | ||||||
| San Francisco City & County, Finance, RB, NATL-RE | ||||||||
| Callable 07/01/14 @ 100 | ||||||||
| 3.750%, 07/01/18 | 500 | 519 |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 47
| schedule of investments |
September 30, 2012 |
California Tax Exempt Bond Fund (continued) |
Description | Face Amount (000) | Value (000) |
| San Francisco City & County, Multiple Capital Improvement Projects, Ser B, COP | ||||||||
| Callable 04/01/19 @ 100 | ||||||||
| 5.000%, 04/01/22 | $ | 735 | $ | 856 | ||||
| San Francisco City & County, Redevelopment Agency, Redevelopment Projects, Ser B, TA | ||||||||
| 5.000%, 08/01/17 | 540 | 595 | ||||||
| San Francisco City & County, Redevelopment Agency, Redevelopment Projects, Ser B, TA, NATL-RE FGIC | ||||||||
| 5.250%, 08/01/13 | 500 | 519 | ||||||
| San Francisco City & County, Redevelopment Agency, Redevelopment Projects, Ser B, TA, NATL-RE FGIC | ||||||||
| Callable 08/01/13 @ 100 | ||||||||
| 5.250%, 08/01/18 | 600 | 616 | ||||||
| San Francisco, Bay Area Transit Financing Authority, Ser A, RB, NATL-RE | ||||||||
| Callable 07/01/15 @ 100 | ||||||||
| 5.000%, 07/01/24 | 550 | 599 | ||||||
| San Mateo, Unified High School District, GO | ||||||||
| 1.054%, 02/15/15(D) | 1,000 | 980 | ||||||
| Santa Clara County Financing Authority, RB | ||||||||
| 5.000%, 02/01/20 | 500 | 599 | ||||||
| Santa Margarita, Dana Point Authority, Improvement Districts 3-3A-4-4A, Ser A, RB, AMBAC | ||||||||
| Callable 08/01/14 @ 100 | ||||||||
| 5.000%, 08/01/15 | 290 | 314 | ||||||
| Santa Monica, Public Financing Authority, Ser A, RB | ||||||||
| 5.000%, 06/01/21 | 580 | 726 | ||||||
| Southern California, Public Power Authority, Subordinated Southern Transmission Project, Ser A, RB | ||||||||
| 5.000%, 07/01/17 | 1,200 | 1,435 | ||||||
| University of California, Regents Medical Center, Ser E, RB | ||||||||
| Callable 05/15/17 @ 101 | ||||||||
| 5.000%, 05/15/21 | 250 | 286 | ||||||
| University of California, Ser A, RB, AMBAC | ||||||||
| Pre-Refunded @ 100 | ||||||||
| 5.125%, 05/15/13(B) | 40 | 41 |
Description | Face Amount (000)/Shares | Value (000) | ||||||
| University of California, Ser A, RB, AMBAC | ||||||||
| Callable 05/15/13 @ 100 | ||||||||
| 5.125%, 05/15/15 | $ | 470 | $ | 484 | ||||
Total California | 54,030 | |||||||
| Illinois [0.6%] | ||||||||
| Cook County, Forest Preservation District, GO, AMBAC | ||||||||
| Pre-Refunded @ 100 | ||||||||
5.250%, 11/15/14(B) | 300 | 331 | ||||||
| New York [0.7%] | ||||||||
| New York State, Local Assistance Correction Authority, Ser E, RB | ||||||||
6.000%, 04/01/14 | 370 | 390 | ||||||
| Washington [1.9%] | ||||||||
| Central Puget Sound, Regional Transit Authority, Ser A, RB, AMBAC | ||||||||
| Pre-Refunded @ 100 | ||||||||
5.000%, 05/01/15(B) | 1,000 | 1,120 | ||||||
| Puerto Rico [1.2%] | ||||||||
| Puerto Rico, Sales Tax Financing, Sub-Ser A, RB, ETM | ||||||||
| 4.000%, 08/01/16 | 130 | 148 | ||||||
| Puerto Rico, Sales Tax Financing, Sub-Ser A, RB | ||||||||
| 4.000%, 08/01/16 | 475 | 514 | ||||||
Total Puerto Rico | 662 | |||||||
Total Municipal Bonds (Cost $55,002) | 57,338 | |||||||
| Short-Term Investment [2.6%] | ||||||||
CNI Charter California Tax Exempt Money Market Fund, Cl I, 0.010%*† | 1,498,903 | 1,499 | ||||||
Total Short-Term Investment (Cost $1,499) | 1,499 | |||||||
Total Investments [101.6%] (Cost $56,501) | $ | 58,837 | ||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 48
| schedule of investments |
September 30, 2012 |
California Tax Exempt Bond Fund (concluded) |
Percentages are based on Net Assets of $57,933 ($ Thousands).
| * | The rate reported is the 7-day effective yield as of September 30, 2012. |
| † | Investment in Affiliate. |
| (A) | Floating Rate Security — The rate reported is the rate in effect on September 30, 2012. |
| (B) | Pre-Refunded Security — The maturity date shown is the pre-refunded date. |
| (C) | Security is held in conjunction with a letter of credit from a major bank or financial institution. |
| (D) | Zero coupon security. The rate reported is the effective yield at time of purchase. |
AGM — Assured Guarantee Municipal
AMBAC — American Municipal Bond Assurance Company
Cl — Class
COP — Certificate of Participation
ETM — Escrowed to Maturity
FGIC — Financial Guaranty Insurance Company
FNMA — Federal National Mortgage Association
GO — General Obligation
NATL-RE — National Public Finance Guarantee Corporation
RB — Revenue Bond
SAB — Special Assessment Board
Ser — Series
TA — Tax Allocation
The following is a summary of the inputs used as of September 30, 2012 in valuing the Fund’s investments carried at value ($ Thousands):
| Investments in Securities | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| Municipal Bonds | $ | — | $ | 57,338 | $ | — | $ | 57,338 | ||||||||
| Short-Term Investment | 1,499 | — | — | 1,499 | ||||||||||||
| Total Investments in Securities | $ | 1,499 | $ | 57,338 | $ | — | $ | 58,837 | ||||||||
For the period ended September 30, 2012, there have been no transfers between Level 1 and Level 2 assets and liabilities. Transfers between Levels are recognized at period end.
For more information on valuation inputs, see Note 2 — Significant Accounting Policies in the Notes to Financial Statements.
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 49
| schedule of investments |
September 30, 2012 |
Full Maturity Fixed Income Fund |
Description | Face Amount (000) | Value (000) |
| Corporate Bonds [40.9%] | ||||||||
| Agriculture [0.2%] | ||||||||
| Bunge NA Finance | ||||||||
5.900%, 04/01/17 | $ | 100 | $ | 114 | ||||
| Automotive [0.5%] | ||||||||
| Johnson Controls | ||||||||
| 5.500%, 01/15/16 | 100 | 115 | ||||||
| Volkswagen International Finance | ||||||||
| 2.375%, 03/22/17 (A) | 125 | 130 | ||||||
Total Automotive | 245 | |||||||
| Banks [10.8%] | ||||||||
| Bank of America | ||||||||
| 10.200%, 07/15/15 | 100 | 116 | ||||||
| Bank of America, MTN | ||||||||
| 7.375%, 05/15/14 | 175 | 192 | ||||||
| Barclays Bank | ||||||||
| 5.125%, 01/08/20 | 100 | 112 | ||||||
| BB&T, MTN | ||||||||
| 1.600%, 08/15/17 | 355 | 361 | ||||||
| Capital One Financial | ||||||||
| 7.375%, 05/23/14 | 100 | 110 | ||||||
| Citigroup | ||||||||
| 6.375%, 08/12/14 | 180 | 196 | ||||||
| Commonwealth Bank of Australia | ||||||||
| 5.000%, 10/15/19 (A) | 150 | 172 | ||||||
| Credit Suisse NY, MTN | ||||||||
| 5.300%, 08/13/19 | 150 | 176 | ||||||
| Deutsche Bank, MTN | ||||||||
| 3.450%, 03/30/15 | 100 | 106 | ||||||
| Dresdner Bank - New York | ||||||||
| 7.250%, 09/15/15 | 150 | 159 | ||||||
Description | Face Amount (000) | Value (000) |
| Fifth Third Bancorp | ||||||||
| 3.625%, 01/25/16 | $ | 180 | $ | 194 | ||||
| Goldman Sachs Group | ||||||||
| 3.625%, 02/07/16 | 355 | 374 | ||||||
| ING Bank | ||||||||
| 3.750%, 03/07/17 (A) | 200 | 211 | ||||||
| JPMorgan Chase | ||||||||
| 4.650%, 06/01/14 | 335 | 355 | ||||||
| 4.250%, 10/15/20 | 150 | 164 | ||||||
| KeyBank | ||||||||
| 5.800%, 07/01/14 | 150 | 161 | ||||||
| KeyCorp, MTN | ||||||||
| 3.750%, 08/13/15 | 90 | 97 | ||||||
| Kookmin Bank | ||||||||
| 7.250%, 05/14/14 (A) | 100 | 109 | ||||||
| PNC Funding | ||||||||
| 4.250%, 09/21/15 | 325 | 356 | ||||||
| 3.000%, 05/19/14 | 125 | 130 | ||||||
| Sumitomo Mitsui Banking | ||||||||
| 3.150%, 07/22/15 (A) | 200 | 210 | ||||||
| SunTrust Banks | ||||||||
| 6.000%, 09/11/17 | 119 | 139 | ||||||
| US Bancorp, MTN | ||||||||
| 1.650%, 05/15/17 | 345 | 353 | ||||||
| Wells Fargo | ||||||||
| 3.625%, 04/15/15 | 125 | 134 | ||||||
| Wells Fargo, MTN | ||||||||
| 2.100%, 05/08/17 | 325 | 336 | ||||||
Total Banks | 5,023 | |||||||
| Cable/Media [1.0%] | ||||||||
| DIRECTV Holdings | ||||||||
| 3.500%, 03/01/16 | 180 | 192 | ||||||
| TCI Communications | ||||||||
| 7.875%, 08/01/13 | 75 | 79 | ||||||
| Time Warner Cable | ||||||||
| 4.125%, 02/15/21 | 180 | 199 | ||||||
Total Cable/Media | 470 | |||||||
| Chemicals [0.4%] | ||||||||
| Dow Chemical | ||||||||
2.500%, 02/15/16 | 185 | 193 |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 50
| schedule of investments |
September 30, 2012 |
Full Maturity Fixed Income Fund (continued) |
Description | Face Amount (000) | Value (000) |
| Computer System Design & Services [0.7%] | ||||||||
| Hewlett-Packard | ||||||||
| 4.650%, 12/09/21 | $ | 150 | $ | 156 | ||||
| 2.125%, 09/13/15 | 190 | 193 | ||||||
Total Computer System Design & Services | 349 | |||||||
| Drugs [0.6%] | ||||||||
| Teva Pharmaceutical | ||||||||
| 5.550%, 02/01/16 | 75 | 86 | ||||||
| Wyeth | ||||||||
| 5.500%, 02/15/16 | 160 | 185 | ||||||
Total Drugs | 271 | |||||||
| Electronic Compo-Semicon [0.3%] | ||||||||
| Texas Instruments | ||||||||
1.650%, 08/03/19 | 150 | 151 | ||||||
| Energy [1.8%] | ||||||||
| Carolina Power & Light | ||||||||
| 5.150%, 04/01/15 | 80 | 88 | ||||||
| Exelon | ||||||||
| 5.625%, 06/15/35 | 75 | 85 | ||||||
| Exelon Generation | ||||||||
| 4.250%, 06/15/22 (A) | 100 | 106 | ||||||
| Korea Electric Power | ||||||||
| 7.750%, 04/01/13 | 95 | 98 | ||||||
| 6.750%, 08/01/27 | 75 | 93 | ||||||
| PPL Energy Supply, Ser A | ||||||||
| 5.700%, 10/15/15 | 75 | 82 | ||||||
| Trans-Allegheny Interstate Line | ||||||||
| 4.000%, 01/15/15 (A) | 100 | 105 | ||||||
| Virginia Electric and Power | ||||||||
| 8.875%, 11/15/38 | 100 | 172 | ||||||
Total Energy | 829 | |||||||
| Finance Auto Loans [0.2%] | ||||||||
| Toyota Motor Credit, MTN | ||||||||
2.000%, 09/15/16 | 100 | 104 | ||||||
| Financial Services [3.5%] | ||||||||
| American Express Credit, MTN | ||||||||
| 7.300%, 08/20/13 | 180 | 191 | ||||||
| Associates Corp of North America | ||||||||
| 6.950%, 11/01/18 | 150 | 180 | ||||||
| Bank of New York Mellon, MTN | ||||||||
| 3.100%, 01/15/15 | 175 | 185 | ||||||
Description | Face Amount (000) | Value (000) |
| General Electric Capital, MTN | ||||||||
| 6.000%, 08/07/19 | $ | 125 | $ | 152 | ||||
| 4.375%, 09/16/20 | 150 | 165 | ||||||
| 2.250%, 11/09/15 | 350 | 363 | ||||||
| HSBC Finance | ||||||||
| 6.676%, 01/15/21 (A) | 83 | 96 | ||||||
| National Rural Utilities Cooperative Finance | ||||||||
| 10.375%, 11/01/18 | 125 | 185 | ||||||
| UFJ Finance Aruba | ||||||||
| 6.750%, 07/15/13 | 125 | 131 | ||||||
Total Financial Services | 1,648 | |||||||
| Food, Beverage & Tobacco [1.1%] | ||||||||
| General Mills | ||||||||
| 5.650%, 02/15/19 | 80 | 97 | ||||||
| Kraft Foods | ||||||||
| 6.500%, 08/11/17 | 155 | 191 | ||||||
| PepsiCo | ||||||||
| 3.125%, 11/01/20 | 220 | 237 | ||||||
Total Food, Beverage & Tobacco | 525 | |||||||
| Gas-Distribution [0.2%] | ||||||||
| KeySpan | ||||||||
8.000%, 11/15/30 | 50 | 69 | ||||||
| Insurance [2.4%] | ||||||||
| Manulife Financial | ||||||||
| 3.400%, 09/17/15 | 198 | 207 | ||||||
| MetLife | ||||||||
| 5.000%, 06/15/15 | 175 | 194 | ||||||
| Metropolitan Life Global Funding I | ||||||||
| 3.875%, 04/11/22 (A) | 125 | 136 | ||||||
| Protective Life | ||||||||
| 4.300%, 06/01/13 | 100 | 102 | ||||||
| Prudential Financial, MTN | ||||||||
| 6.200%, 01/15/15 | 160 | 177 | ||||||
| 5.375%, 06/21/20 | 170 | 197 | ||||||
| Travelers | ||||||||
| 3.900%, 11/01/20 | 120 | 136 | ||||||
Total Insurance | 1,149 | |||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 51
| schedule of investments |
September 30, 2012 |
Full Maturity Fixed Income Fund (continued) |
Description | Face Amount (000) | Value (000) |
| Insurance Brokers [0.6%] | ||||||||
| Aon | ||||||||
| 3.500%, 09/30/15 | $ | 200 | $ | 212 | ||||
| Marsh & McLennan | ||||||||
| 5.750%, 09/15/15 | 79 | 88 | ||||||
Total Insurance Brokers | 300 | |||||||
| Invest Mgmnt/Advis Serv [0.4%] | ||||||||
| BlackRock | ||||||||
3.500%, 12/10/14 | 170 | 181 | ||||||
| Investment Banker/Broker Dealer [1.6%] | ||||||||
| Goldman Sachs Group | ||||||||
| 5.150%, 01/15/14 | 75 | 79 | ||||||
| Jefferies Group | ||||||||
| 6.450%, 06/08/27 | 100 | �� | 102 | |||||
| Morgan Stanley | ||||||||
| 5.300%, 03/01/13 | 190 | 193 | ||||||
| 4.750%, 04/01/14 | 75 | 78 | ||||||
| Morgan Stanley, MTN | ||||||||
| 6.625%, 04/01/18 | 100 | 115 | ||||||
| TD Ameritrade Holding | ||||||||
| 4.150%, 12/01/14 | 180 | 192 | ||||||
Total Investment Banker/Broker Dealer | 759 | |||||||
| Medical Products [0.2%] | ||||||||
| Zimmer Holdings | ||||||||
4.625%, 11/30/19 | 75 | 86 | ||||||
| Medical-HMO [0.4%] | ||||||||
| UnitedHealth Group | ||||||||
| 4.750%, 02/10/14 | 40 | 42 | ||||||
| 4.700%, 02/15/21 | 125 | 146 | ||||||
Total Medical-HMO | 188 | |||||||
| Metal-Copper [0.3%] | ||||||||
| Freeport-McMoRan Copper | ||||||||
2.150%, 03/01/17 | 120 | 121 | ||||||
| Metals & Mining [0.4%] | ||||||||
| Rio Tinto Finance USA | ||||||||
| 6.500%, 07/15/18 | 100 | 124 | ||||||
| Vale Overseas | ||||||||
| 6.875%, 11/21/36 | 100 | 116 | ||||||
Total Metals & Mining | 240 | |||||||
Description | Face Amount (000) | Value (000) |
| Multi-Media [1.6%] | ||||||||
| CBS | ||||||||
| 3.375%, 03/01/22 | $ | 185 | $ | 193 | ||||
| Time Warner | ||||||||
| 7.700%, 05/01/32 | 150 | 211 | ||||||
| 5.875%, 11/15/16 | 160 | 190 | ||||||
| Viacom | ||||||||
| 6.250%, 04/30/16 | 125 | 146 | ||||||
Total Multi-Media | 740 | |||||||
| Networking Products [0.3%] | ||||||||
| Cisco Systems | ||||||||
5.500%, 01/15/40 | 100 | 128 | ||||||
| Oil, Gas & Consumable Fuels [2.2%] | ||||||||
| BP Capital Markets | ||||||||
| 3.200%, 03/11/16 | 100 | 107 | ||||||
| 3.125%, 10/01/15 | 345 | 369 | ||||||
| Husky Energy | ||||||||
| 3.950%, 04/15/22 | 150 | 161 | ||||||
| Marathon Oil | ||||||||
| 6.000%, 10/01/17 | 150 | 184 | ||||||
| Petrobras International Finance | ||||||||
| 3.875%, 01/27/16 | 100 | 106 | ||||||
| Total Capital International | ||||||||
| 1.500%, 02/17/17 | 100 | 102 | ||||||
Total Oil, Gas & Consumable Fuels | 1,029 | |||||||
| Petroleum & Fuel Products [1.9%] | ||||||||
| Anadarko Finance | ||||||||
| 7.500%, 05/01/31 | 150 | 201 | ||||||
| DCP Midstream | ||||||||
| 9.750%, 03/15/19 (A) | 114 | 147 | ||||||
| Energy Transfer Partners | ||||||||
| 6.625%, 10/15/36 | 75 | 85 | ||||||
| Enterprise Products Operating | ||||||||
| 3.700%, 06/01/15 | 125 | 134 | ||||||
| Kinder Morgan Energy Partners | ||||||||
| 5.300%, 09/15/20 | 125 | 146 | ||||||
| ONEOK | ||||||||
| 4.250%, 02/01/22 | 100 | 108 | ||||||
| ONEOK Partners | ||||||||
| 2.000%, 10/01/17 | 80 | 81 | ||||||
Total Petroleum & Fuel Products | 902 | |||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 52
| schedule of investments |
September 30, 2012 |
Full Maturity Fixed Income Fund (continued) |
Description | Face Amount (000) | Value (000) |
| Pharmacy Services [0.4%] | ||||||||
| Aristotle Holding | ||||||||
3.500%, 11/15/16 (A) | $ | 150 | $ | 162 | ||||
| Property Trust [0.3%] | ||||||||
| WEA Finance | ||||||||
7.500%, 06/02/14 (A) | 125 | 138 | ||||||
| REITS-Health Care [0.4%] | ||||||||
| Health Care | ||||||||
4.950%, 01/15/21 | 180 | 197 | ||||||
| REITS-Office Property [0.4%] | ||||||||
| Boston Properties | ||||||||
5.875%, 10/15/19 | 165 | 197 | ||||||
| REITS-Regional Malls [0.8%] | ||||||||
| Simon Property Group | ||||||||
2.150%, 09/15/17 | 350 | 362 | ||||||
| Retail [1.2%] | ||||||||
| Home Depot | ||||||||
| 5.400%, 03/01/16 | 315 | 364 | ||||||
| Lowe's | ||||||||
| 5.000%, 10/15/15 | 165 | 186 | ||||||
Total Retail | 550 | |||||||
| Retail-Regnl Dept Store [0.4%] | ||||||||
| Macy's Retail Holdings | ||||||||
5.900%, 12/01/16 | 165 | 193 | ||||||
| Telephones & Telecommunications [3.2%] | ||||||||
| AT&T | ||||||||
| 5.600%, 05/15/18 | 310 | 380 | ||||||
| British Telecommunications | ||||||||
| 9.625%, 12/15/30 | 100 | 163 | ||||||
| Deutsche Telekom International Finance | ||||||||
| 8.750%, 06/15/30 | 75 | 113 | ||||||
| 6.000%, 07/08/19 | 50 | 60 | ||||||
| GTE | ||||||||
| 6.840%, 04/15/18 | 100 | 126 | ||||||
| New Cingular Wireless Services | ||||||||
| 8.750%, 03/01/31 | 75 | 120 | ||||||
| Telecom Italia Capital | ||||||||
| 7.200%, 07/18/36 | 75 | 74 | ||||||
| Telefonica Emisiones | ||||||||
| 6.421%, 06/20/16 | 75 | 79 | ||||||
Description | Face Amount (000) | Value (000) |
| Verizon Communications | ||||||||
| 3.000%, 04/01/16 | $ | 345 | $ | 372 | ||||
Total Telephones & Telecommunications | 1,487 | |||||||
| Waste Disposal [0.2%] | ||||||||
| Waste Management | ||||||||
2.600%, 09/01/16 | 100 | 105 | ||||||
Total Corporate Bonds (Cost $17,981) | 19,205 | |||||||
| U.S. Government Mortgage-Backed Obligations [21.8%] | ||||||||
| FHLMC, Pool A93505 | ||||||||
| 4.500%, 08/01/40 | 102 | 110 | ||||||
| FHLMC, Pool A93996 | ||||||||
| 4.500%, 09/01/40 | 133 | 144 | ||||||
| FHLMC, Pool C03490 | ||||||||
| 4.500%, 08/01/40 | 742 | 800 | ||||||
| FHLMC, Pool C20300 | ||||||||
| 6.500%, 01/01/29 | 6 | 7 | ||||||
| FHLMC, Pool E01280 | ||||||||
| 5.000%, 12/01/17 | 11 | 12 | ||||||
| FHLMC, Pool G04222 | ||||||||
| 5.500%, 04/01/38 | 75 | 81 | ||||||
| FHLMC, Pool G04913 | ||||||||
| 5.000%, 03/01/38 | 230 | 249 | ||||||
| FHLMC, Pool G08003 | ||||||||
| 6.000%, 07/01/34 | 46 | 51 | ||||||
| FHLMC, Pool G11431 | ||||||||
| 6.000%, 02/01/18 | 8 | 8 | ||||||
| FHLMC, Pool G11880 | ||||||||
| 5.000%, 12/01/20 | 36 | 39 | ||||||
| FHLMC, Pool G18124 | ||||||||
| 6.000%, 06/01/21 | 26 | 29 | ||||||
| FHLMC, Pool J19197 | ||||||||
| 3.000%, 05/01/27 | 266 | 281 | ||||||
| FHLMC, Pool Q08998 | ||||||||
| 3.500%, 06/01/42 | 271 | 292 | ||||||
| FHLMC ARM (B) | ||||||||
| 2.778%, 01/01/35 | 12 | 13 | ||||||
| 2.754%, 01/01/35 | 7 | 8 | ||||||
| 2.620%, 12/01/34 | 21 | 22 | ||||||
| FHLMC Multifamily Structured Pass-Through Certificates, Ser 2011-K704, Cl A2 | ||||||||
| 2.412%, 08/25/18 | 400 | 424 | ||||||
| FHLMC Multifamily Structured Pass-Through Certificates, Ser 2012-K705, Cl A2 | ||||||||
| 2.303%, 09/25/18 | 200 | 212 | ||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 53
| schedule of investments |
September 30, 2012 |
Full Maturity Fixed Income Fund (continued) |
Description | Face Amount (000) | Value (000) |
| FHLMC Multifamily Structured Pass-Through Certificates, Ser 2012-K706, Cl A2 | ||||||||
| 2.323%, 10/25/18 | $ | 150 | $ | 159 | ||||
| FHLMC Multifamily Structured Pass-Through Certificates, Ser 2012-K708, Cl A2 | ||||||||
| 2.130%, 01/25/19 | 300 | 314 | ||||||
| FHLMC REMIC, Ser 2007-R010, Cl VA | ||||||||
| 5.500%, 04/15/17 | 77 | 79 | ||||||
| FHLMC REMIC, Ser 2804, Cl VC | ||||||||
| 5.000%, 07/15/21 | 124 | 137 | ||||||
| FHLMC REMIC, Ser 3132, Cl MA | ||||||||
| 5.500%, 12/15/23 | 1 | 1 | ||||||
| FHLMC REMIC, Ser R003, Cl VA | ||||||||
| 5.500%, 08/15/16 | 85 | 86 | ||||||
| FHLMC REMIC, Ser R009, Cl AJ | ||||||||
| 5.750%, 12/15/18 | 2 | 2 | ||||||
| FHLMC REMIC, Ser R010, Cl AB | ||||||||
| 5.500%, 12/15/19 | 24 | 24 | ||||||
| FNMA REMIC, Ser 136, Cl PK | ||||||||
| 6.000%, 08/25/22 | 12 | 13 | ||||||
| FNMA REMIC, Ser 33, Cl LD | ||||||||
| 4.250%, 09/25/22 | 21 | 21 | ||||||
| FNMA Whole Loan, Ser W6, Cl 1A6 | ||||||||
| 5.500%, 07/25/34 | 35 | 36 | ||||||
| FNMA, Pool 252570 | ||||||||
| 6.500%, 07/01/29 | 11 | 13 | ||||||
| FNMA, Pool 253183 | ||||||||
| 7.500%, 04/01/30 | 1 | 1 | ||||||
| FNMA, Pool 253398 | ||||||||
| 8.000%, 08/01/30 | 4 | 5 | ||||||
| FNMA, Pool 254510 | ||||||||
| 5.000%, 11/01/17 | 16 | 17 | ||||||
| FNMA, Pool 254545 | ||||||||
| 5.000%, 12/01/17 | 31 | 34 | ||||||
| FNMA, Pool 254685 | ||||||||
| 5.000%, 04/01/18 | 26 | 28 | ||||||
| FNMA, Pool 254949 | ||||||||
| 5.000%, 11/01/33 | 33 | 36 | ||||||
| FNMA, Pool 255814 | ||||||||
| 5.500%, 08/01/35 | 75 | 83 | ||||||
| FNMA, Pool 303168 | ||||||||
| 9.500%, 02/01/25 | 3 | 4 |
Description | Face Amount (000) | Value (000) |
| FNMA, Pool 725424 | ||||||||
| 5.500%, 04/01/34 | $ | 57 | $ | 63 | ||||
| FNMA, Pool 735060 | ||||||||
| 6.000%, 11/01/34 | 34 | 39 | ||||||
| FNMA, Pool 735228 | ||||||||
| 5.500%, 02/01/35 | 31 | 34 | ||||||
| FNMA, Pool 735230 | ||||||||
| 5.500%, 02/01/35 | 74 | 82 | ||||||
| FNMA, Pool 745275 | ||||||||
| 5.000%, 02/01/36 | 334 | 365 | ||||||
| FNMA, Pool 745418 | ||||||||
| 5.500%, 04/01/36 | 404 | 446 | ||||||
| FNMA, Pool 844809 | ||||||||
| 5.000%, 11/01/35 | 191 | 209 | ||||||
| FNMA, Pool AD0454 | ||||||||
| 5.000%, 11/01/21 | 81 | 88 | ||||||
| FNMA, Pool AD8522 | ||||||||
| 4.000%, 08/01/40 | 105 | 113 | ||||||
| FNMA, Pool AE0828 | ||||||||
| 3.500%, 02/01/41 | 580 | 623 | ||||||
| FNMA, Pool AE0949 | ||||||||
| 4.000%, 02/01/41 | 632 | 682 | ||||||
| FNMA, Pool AH0621 | ||||||||
| 3.500%, 01/01/41 | 156 | 167 | ||||||
| FNMA, Pool AJ1407 | ||||||||
| 4.000%, 09/01/41 | 155 | 168 | ||||||
| FNMA, Pool AJ7689 | ||||||||
| 4.000%, 12/01/41 | 467 | 504 | ||||||
| FNMA, Pool AJ9355 | ||||||||
| 3.000%, 01/01/27 | 576 | 612 | ||||||
| FNMA, Pool AO2970 | ||||||||
| 3.000%, 05/01/42 | 270 | 285 | ||||||
| FNMA, Pool AO4137 | ||||||||
| 3.500%, 06/01/42 | 297 | 319 | ||||||
| FNMA ARM | ||||||||
| 2.590%, 04/01/35 (B) | 93 | 97 | ||||||
| GNMA, Pool 479168 | ||||||||
| 8.000%, 02/15/30 | 8 | 8 | ||||||
| GNMA, Pool 780315 | ||||||||
| 9.500%, 12/15/17 | 5 | 6 | ||||||
| GNMA, Pool G2 4696 | ||||||||
| 4.500%, 05/20/40 | 308 | 342 | ||||||
| GNMA, Pool G2 4747 | ||||||||
| 5.000%, 07/20/40 | 121 | 135 | ||||||
| GNMA, Pool G2 4923 | ||||||||
| 4.500%, 01/20/41 | 159 | 176 | ||||||
| GNMA, Pool G2 MA0155 | ||||||||
| 4.000%, 06/20/42 | 395 | 435 | ||||||
| NCUA Guaranteed Notes, Ser 2010-C1, Cl A2 | ||||||||
| 2.900%, 10/29/20 | 225 | 242 |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 54
| schedule of investments |
September 30, 2012 |
Full Maturity Fixed Income Fund (continued) |
Description | Face Amount (000) | Value (000) |
| NCUA Guaranteed Notes, Ser 2010-R1, Cl 2A | ||||||||
| 1.840%, 10/07/20 | $ | 93 | $ | 95 | ||||
Total U.S. Government Mortgage-Backed Obligations (Cost $9,779) | 10,210 | |||||||
| U.S. Treasury Obligations [18.9%] | ||||||||
| U.S. Treasury Bonds | ||||||||
| 6.250%, 08/15/23 | 1,100 | 1,596 | ||||||
| 5.250%, 11/15/28 | 725 | 1,015 | ||||||
| 4.375%, 02/15/38 | 950 | 1,251 | ||||||
| U.S. Treasury Notes | ||||||||
| 2.750%, 02/15/19 | 810 | 902 | ||||||
| 2.625%, 04/30/16 | 395 | 426 | ||||||
| 2.625%, 11/15/20 | 425 | 469 | ||||||
| 2.375%, 07/31/17 | 1,025 | 1,112 | ||||||
| 1.750%, 05/15/22 | 795 | 806 | ||||||
| 1.250%, 04/30/19 | 525 | 535 | ||||||
| 0.875%, 07/31/19 | 745 | 738 | ||||||
Total U.S. Treasury Obligations (Cost $8,300) | 8,850 | |||||||
| U.S. Government Agency Obligations [7.7%] | ||||||||
| FHLMC | ||||||||
| 2.500%, 01/07/14 | 375 | 386 | ||||||
| FNMA | ||||||||
| 4.625%, 10/15/13 | 415 | 434 | ||||||
| 2.875%, 12/11/13 | 460 | 475 | ||||||
| 2.375%, 07/28/15 | 830 | 876 | ||||||
| 1.375%, 11/15/16 | 370 | 381 | ||||||
| 1.125%, 04/27/17 | 200 | 204 | ||||||
| 0.625%, 10/30/14 | 860 | 866 | ||||||
Total U.S. Government Agency Obligations (Cost $3,574) | 3,622 | |||||||
| Asset-Backed Securities [3.3%] | ||||||||
| American Express Credit Account Master Trust, Ser 2008-5, Cl A | ||||||||
| 1.021%, 03/15/16 (B) | 200 | 201 | ||||||
| American Express Credit Account Master Trust, Ser 2009-2, Cl A | ||||||||
| 1.471%, 03/15/17 (B) | 300 | 307 | ||||||
| Bayview Financial Acquisition Trust, Ser 2007-A, Cl 1A2 | ||||||||
| 6.205%, 05/28/37 | 174 | 176 | ||||||
Description | Face Amount (000) | Value (000) |
| Cityscape Home Equity Loan Trust, Ser 1997-C, Cl A4 | ||||||||
| 7.000%, 07/25/28 (C) | $ | 3 | $ | 3 | ||||
| Discover Card Master Trust, Ser 2010-A1 | ||||||||
| 0.871%, 09/15/15 (B) | 650 | 652 | ||||||
| GMAC Mortgage Corporation Loan Trust, Ser 2004-GH1, Cl A6 | ||||||||
| 4.810%, 07/25/35 | 79 | 77 | ||||||
| Green Tree Financial, Ser 1997-7, Cl A6 | ||||||||
| 6.760%, 07/15/29 | 48 | 51 | ||||||
| RAAC, Ser 2004-SP1, Cl AI4 | ||||||||
| 5.285%, 08/25/27 (B) | 34 | 34 | ||||||
| Residential Asset Mortgage Products, Ser 2002-RS3, Cl AI5 | ||||||||
| 5.572%, 06/25/32 (B) | 40 | 33 | ||||||
Total Asset-Backed Securities (Cost $1,541) | 1,534 | |||||||
| Commercial Mortgage-Backed Obligations [2.3%] | ||||||||
| Citigroup, Ser 2005-CD1, Cl A4 | ||||||||
| 5.393%, 07/15/44 (B) | 200 | 224 | ||||||
| Citigroup, Ser 2007-CD4, Cl A2B | ||||||||
| 5.205%, 12/11/49 | 32 | 33 | ||||||
| Commercial Mortgage Trust, Ser 2012-CR2, Cl A4 | ||||||||
| 3.147%, 08/15/45 | 125 | 132 | ||||||
| Commercial Mortgage, Ser 2005-C6, Cl A5A | ||||||||
| 5.116%, 06/10/44 (B) | 200 | 222 | ||||||
| JPMorgan Chase, Ser 2006-CB17, Cl ASB | ||||||||
| 5.415%, 12/12/43 | 163 | 175 | ||||||
| Wachovia Bank Commercial Mortgage Trust, Ser 2005-C22 | ||||||||
| 5.469%, 12/15/44 (B) | 250 | 281 | ||||||
Total Commercial Mortgage-Backed Obligations (Cost $995) | 1,067 | |||||||
| Residential Mortgage-Backed Securities [0.5%] | ||||||||
| Banc of America Alternative Loan Trust, Ser 2004-2, Cl 5A1 | ||||||||
| 5.500%, 03/25/19 | 54 | 56 | ||||||
| Chase Mortgage Finance, Ser 2003-S13, Cl A11 | ||||||||
| 5.500%, 11/25/33 | 35 | 35 | ||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 55
| schedule of investments |
September 30, 2012 |
Full Maturity Fixed Income Fund (concluded) |
Description | Face Amount (000)/Shares | Value (000) | ||||||
| Residential Accredit Loans, Ser 2004-QS5, Cl A5 | ||||||||
| 4.750%, 04/25/34 | $ | 18 | $ | 18 | ||||
| Residential Accredit Loans, Ser 2004-QS6, Cl A1 | ||||||||
| 5.000%, 05/25/19 | 29 | 29 | ||||||
| WaMu Mortgage Pass-Through Certificates, Ser 2004-CB2, Cl 5A | ||||||||
| 5.000%, 07/25/19 | 87 | 90 | ||||||
Total Residential Mortgage-Backed Securities (Cost $222) | 228 | |||||||
| Sovereign Debt [0.2%] | ||||||||
| United Mexican States, MTN | ||||||||
| 5.125%, 01/15/20 | 100 | 120 | ||||||
Total Sovereign Debt (Cost $99) | 120 | |||||||
| Municipal Bond [0.2%] | ||||||||
| Puerto Rico [0.2%] | ||||||||
| Government Development Bank for Puerto Rico, Ser B, RB | ||||||||
| 4.704%, 05/01/16 | 100 | 103 | ||||||
Total Municipal Bond (Cost $100) | 103 | |||||||
| Short-Term Investments [4.5%] | ||||||||
CNI Government Money Market Fund, Cl I, 0.010% *† | 1,045,027 | 1,045 | ||||||
| SEI Daily Income Trust Government Fund, Cl A, 0.020% * | 1,045,027 | 1,045 | ||||||
Total Short-Term Investments (Cost $2,090) | 2,090 | |||||||
Total Investments [100.3%] (Cost $44,681) | $ | 47,029 | ||||||
Percentages are based on Net Assets of $46,901 ($ Thousands).
| * | The rate reported is the 7-day effective yield as of September 30, 2012. |
| † | Investment in Affiliate. |
| (A) | Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration normally to qualified institutions. On September 30, 2012, the value of these securities amounted to $1,722 ($ Thousands), representing 3.7% of the net assets of the Fund. |
| (B) | Floating Rate Security — The rate reported is the rate in effect on September 30, 2012. |
| (C) | In default on interest payments. Rate shown represents the last coupon rate prior to default. |
ARM — Adjustable Rate Mortgage
Cl — Class
FHLMC — Federal Home Loan Mortgage Corporation
FNMA — Federal National Mortgage Association
GNMA — Government National Mortgage Association
HMO — Health Maintenance Organization
MTN — Medium Term Note
NA — National Association
NCUA — National Credit Union Administration
RB — Revenue Bond
REITS — Real Estate Investment Trusts
REMIC — Real Estate Mortgage Investment Conduit
Ser — Series
The following is a list of the inputs used as of September 30, 2012 in valuing the Fund’s investments carried at value ($ Thousands):
| Investments in Securities | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| Corporate Bonds | $ | — | $ | 19,205 | $ | — | $ | 19,205 | ||||||||
| U.S. Government Mortgage-Backed Obligations | — | 10,210 | — | 10,210 | ||||||||||||
| U.S. Treasury Obligations | — | 8,850 | — | 8,850 | ||||||||||||
| U.S. Government Agency Obligations | — | 3,622 | — | 3,622 | ||||||||||||
| Asset-Backed Securities | — | 1,534 | — | 1,534 | ||||||||||||
| Commercial Mortgage-Backed Obligations | — | 1,067 | — | 1,067 | ||||||||||||
| Residential Mortgage-Backed Securities | — | 228 | — | 228 | ||||||||||||
| Sovereign Debt | — | 120 | — | 120 | ||||||||||||
| Municipal Bond | — | 103 | — | 103 | ||||||||||||
| Short-Term Investments | 2,090 | — | — | 2,090 | ||||||||||||
| Total Investments in Securities | $ | 2,090 | $ | 44,939 | $ | — | $ | 47,029 | ||||||||
For the year ended September 30, 2012, there have been no transfers between Level 1 and Level 2 assets and liabilities. Transfers between Levels are recognized at period end.
For more information on valuation inputs, see Note 2 — Significant Accounting Policies in the Notes to Financial Statements.
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 56
| schedule of investments |
September 30, 2012 |
High Yield Bond Fund |
Description | Face Amount (000) | Value (000) |
| Corporate Bonds [91.7%] | ||||||||
| Advertising Agencies [0.7%] | ||||||||
| MDC Partners | ||||||||
11.000%, 11/01/16 | $ | 925 | $ | 1,008 | ||||
| Aerospace & Defense [0.7%] | ||||||||
| Global Aviation Holdings | ||||||||
| 14.000%, 08/15/13(B) | 547 | 156 | ||||||
| Sequa | ||||||||
| 13.500%, 12/01/15(A) | 101 | 107 | ||||||
| 11.750%, 12/01/15(A) | 775 | 814 | ||||||
Total Aerospace & Defense | 1,077 | |||||||
| Airlines [0.9%] | ||||||||
| American Airlines 2011-2 Cl A Pass-Through Trust | ||||||||
| 8.625%, 10/15/21 | 485 | 522 | ||||||
| Continental Airlines, Ser 2007-1, Cl C | ||||||||
| 7.339%, 04/19/14 | 262 | 272 | ||||||
| Continental Airlines 2009-2 Cl B Pass-Through Trust | ||||||||
| 9.250%, 05/10/17 | 156 | 172 | ||||||
| DAE Aviation Holdings | ||||||||
| 11.250%, 08/01/15(A) | 150 | 154 | ||||||
| Delta Airlines | ||||||||
| 12.250%, 03/15/15(A) | 250 | 271 | ||||||
Total Airlines | 1,391 | |||||||
| Apparel/Textiles [0.4%] | ||||||||
| Levi Strauss | ||||||||
6.875%, 05/01/22 | 620 | 646 | ||||||
Description | Face Amount (000) | Value (000) |
| Auto Rent & Lease [0.2%] | ||||||||
| Avis Budget Car Rental | ||||||||
8.250%, 01/15/19 | $ | 300 | $ | 327 | ||||
| Autoparts [0.7%] | ||||||||
| Asbury Automotive Group | ||||||||
| 7.625%, 03/15/17 | 100 | 103 | ||||||
| Stanadyne | ||||||||
| 10.000%, 08/15/14 | 900 | 839 | ||||||
| Stanadyne Holdings | ||||||||
| 10.000%, 02/15/15(D) | 75 | 50 | ||||||
Total Autoparts | 992 | |||||||
| Broadcasting & Cable [3.9%] | ||||||||
| Bonten Media Acquisition | ||||||||
| 9.000%, 06/01/15(A) (E) | 190 | 151 | ||||||
| Bresnan Broadband Holdings | ||||||||
| 8.000%, 12/15/18(A) | 750 | 819 | ||||||
| Cablevision Systems | ||||||||
| 8.000%, 04/15/20 | 400 | 446 | ||||||
| CSC Holdings | ||||||||
| 7.625%, 07/15/18 | 100 | 115 | ||||||
| 6.750%, 11/15/21(A) | 300 | 331 | ||||||
| DCP | ||||||||
| 10.750%, 08/15/15(A) | 500 | 510 | ||||||
| DISH DBS | ||||||||
| 5.875%, 07/15/22(A) | 875 | 897 | ||||||
| Local TV Finance | ||||||||
| 9.250%, 06/15/15(A) | 122 | 124 | ||||||
| Newport Television | ||||||||
| 13.000%, 03/15/17(A) | 149 | 161 | ||||||
| Unitymedia Hessen GmbH & KG | ||||||||
| 7.500%, 03/15/19(A) | 500 | 549 | ||||||
| Univision Communications (A) | ||||||||
| 6.875%, 05/15/19 | 1,525 | 1,571 | ||||||
| 6.750%, 09/15/22 | 250 | 250 | ||||||
Total Broadcasting & Cable | 5,924 | |||||||
| Building & Construction [1.7%] | ||||||||
| APERAM (A) | ||||||||
| 7.750%, 04/01/18 | 950 | 779 | ||||||
| 7.375%, 04/01/16 | 400 | 342 | ||||||
| Building Materials Corp of America | ||||||||
| 6.750%, 05/01/21(A) | 950 | 1,040 | ||||||
| Dycom Investments | ||||||||
| 7.125%, 01/15/21 | 300 | 323 | ||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 57
| schedule of investments |
September 30, 2012 |
High Yield Bond Fund (continued) |
Description | Face Amount (000) | Value (000) |
| Interline Brands | ||||||||
| 7.500%, 11/15/18 | $ | 190 | $ | 206 | ||||
Total Building & Construction | 2,690 | |||||||
| Chemicals [0.4%] | ||||||||
| Nexeo Solutions | ||||||||
| 8.375%, 03/01/18 | 250 | 247 | ||||||
| Polymer Group | ||||||||
| 7.750%, 02/01/19 | 380 | 405 | ||||||
Total Chemicals | 652 | |||||||
| Coal Mining [1.4%] | ||||||||
| CONSOL Energy | ||||||||
| 8.250%, 04/01/20 | 400 | 419 | ||||||
| Penn Virginia Resource Partners | ||||||||
| 8.375%, 06/01/20(A) | 1,380 | 1,425 | ||||||
| 8.250%, 04/15/18 | 405 | 418 | ||||||
Total Coal Mining | 2,262 | |||||||
| Commercial Services [2.4%] | ||||||||
| Bankrate | ||||||||
| 11.750%, 07/15/15 | 162 | 182 | ||||||
| Ceridian | ||||||||
| 8.875%, 07/15/19(A) | 600 | 648 | ||||||
| CKE Holdings | ||||||||
| 10.500%, 03/14/16(A) | 801 | 865 | ||||||
| DynCorp International | ||||||||
| 10.375%, 07/01/17 | 1,000 | 863 | ||||||
| ServiceMaster | ||||||||
| 8.000%, 02/15/20 | 425 | 450 | ||||||
| 7.450%, 08/15/27 | 275 | 229 | ||||||
| 7.100%, 03/01/18 | 380 | 369 | ||||||
Total Commercial Services | 3,606 | |||||||
| Communications Software [0.4%] | ||||||||
| Aspect Software | ||||||||
10.625%, 05/15/17 | 600 | 616 | ||||||
| Computer Graphics [0.3%] | ||||||||
| Epicor Software | ||||||||
8.625%, 05/01/19 | 400 | 422 | ||||||
Description | Face Amount (000) | Value (000) |
| Computer System Design & Services [2.8%] | ||||||||
| CompuCom Systems | ||||||||
| 12.500%, 10/01/15(A) | $ | 1,125 | $ | 1,167 | ||||
| iGate | ||||||||
| 9.000%, 05/01/16 | 850 | 933 | ||||||
| Stratus Technologies Bermuda | ||||||||
| 12.000%, 03/29/15 | 766 | 713 | ||||||
| Stream Global Services | ||||||||
| 11.250%, 10/01/14 | 1,510 | 1,570 | ||||||
Total Computer System Design & Services | 4,383 | |||||||
| Consumer Products & Services [5.6%] | ||||||||
| American Achievement | ||||||||
| 10.875%, 04/15/16(A) | 500 | 434 | ||||||
| American Standard Americas | ||||||||
| 10.750%, 01/15/16(A) | 250 | 236 | ||||||
| Armored Autogroup | ||||||||
| 9.250%, 11/01/18 | 1,560 | 1,396 | ||||||
| Central Garden and Pet | ||||||||
| 8.250%, 03/01/18 | 1,500 | 1,590 | ||||||
| Prestige Brands | ||||||||
| 8.250%, 04/01/18 | 250 | 275 | ||||||
| Reynolds Group Issuer | ||||||||
| 6.875%, 02/15/21 | 1,525 | 1,609 | ||||||
| Spectrum Brands Holdings | ||||||||
| 9.500%, 06/15/18(A) | 850 | 958 | ||||||
| WMG Acquisition | ||||||||
| 11.500%, 10/01/18 | 1,260 | 1,418 | ||||||
| Yankee Acquisition, Ser B | ||||||||
| 9.750%, 02/15/17 | 50 | 52 | ||||||
| Yankee Candle | ||||||||
| 8.500%, 02/15/15 | 91 | 92 | ||||||
| YCC Holdings | ||||||||
| 10.250%, 02/15/16(C) | 600 | 621 | ||||||
Total Consumer Products & Services | 8,681 | |||||||
| Containers & Packaging [0.8%] | ||||||||
| Intertape Polymer US | ||||||||
| 8.500%, 08/01/14 | 79 | 79 | ||||||
| Pretium Packaging | ||||||||
| 11.500%, 04/01/16 | 350 | 358 | ||||||
| Sealed Air | ||||||||
| 8.125%, 09/15/19(A) | 750 | 834 | ||||||
Total Containers & Packaging | 1,271 | |||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 58
| schedule of investments |
September 30, 2012 |
High Yield Bond Fund (continued) |
Description | Face Amount (000) | Value (000) |
| Data Processing/Mgmt [1.5%] | ||||||||
| Fidelity National Information Services | ||||||||
| 7.875%, 07/15/20 | $ | 365 | $ | 408 | ||||
| First Data (A) | ||||||||
| 8.875%, 08/15/20 | 150 | 163 | ||||||
| 8.750%, 01/15/22 | 1,710 | 1,723 | ||||||
Total Data Processing/Mgmt | 2,294 | |||||||
| Distribution/Wholesale [1.9%] | ||||||||
| Baker & Taylor | ||||||||
| 11.500%, 07/01/13(A) | 475 | 475 | ||||||
| HD Supply (A) | ||||||||
| 11.000%, 04/15/20 | 580 | 644 | ||||||
| 8.125%, 04/15/19 | 565 | 613 | ||||||
| INTCOMEX | ||||||||
| 13.250%, 12/15/14 | 750 | 765 | ||||||
| VWR Funding | ||||||||
| 10.250%, 07/15/15(E) | 423 | 432 | ||||||
Total Distribution/Wholesale | 2,929 | |||||||
| Diversified Operations [0.3%] | ||||||||
| Amsted Industries | ||||||||
8.125%, 03/15/18(A) | 450 | 486 | ||||||
| Drugs [0.5%] | ||||||||
| Endo Health Solutions | ||||||||
| 7.000%, 07/15/19 | 400 | 431 | ||||||
| Grifols | ||||||||
| 8.250%, 02/01/18 | 300 | 331 | ||||||
Total Drugs | 762 | |||||||
| E-Commerce/Products [0.4%] | ||||||||
| GXS Worldwide | ||||||||
9.750%, 06/15/15 | 650 | 669 | ||||||
| Educational Services [0.4%] | ||||||||
| Laureate Education | ||||||||
9.250%, 09/01/19(A) | 600 | 603 | ||||||
| Electric Utilities [0.8%] | ||||||||
| AES | ||||||||
| 7.375%, 07/01/21 | 850 | 969 | ||||||
| RRI Energy | ||||||||
| 7.625%, 06/15/14 | 200 | 214 | ||||||
Total Electric Utilities | 1,183 | |||||||
Description | Face Amount (000) | Value (000) |
| Engines-Internal Combust [0.4%] | ||||||||
| Briggs & Stratton | ||||||||
6.875%, 12/15/20 | $ | 500 | $ | 545 | ||||
| Enterprise Software/Serv [0.7%] | ||||||||
| Infor US | ||||||||
9.375%, 04/01/19(A) | 990 | 1,099 | ||||||
| Entertainment & Gaming [8.1%] | ||||||||
| Buffalo Thunder Development Authority | ||||||||
| 9.375%, 12/15/14(A) (B) | 75 | 27 | ||||||
| Caesars Entertainment Operating | ||||||||
| 10.000%, 12/15/18 | 650 | 426 | ||||||
| 8.500%, 02/15/20(A) | 650 | 650 | ||||||
| Carmike Cinemas | ||||||||
| 7.375%, 05/15/19 | 310 | 333 | ||||||
| Chester Downs & Marina | ||||||||
| 9.250%, 02/01/20(A) | 500 | 503 | ||||||
| Choctaw Resort Development Enterprise | ||||||||
| 7.250%, 11/15/19(A) | 175 | 152 | ||||||
| Chukchansi Economic Development Authority | ||||||||
| 9.750%, 05/30/20(A) | 476 | 309 | ||||||
| Diamond Resorts | ||||||||
| 12.000%, 08/15/18 | 750 | 808 | ||||||
| Inn of the Mountain Gods Resort & Casino (A) | ||||||||
| 8.750%, 11/30/20 | 28 | 28 | ||||||
| 1.250%, 11/30/20 | 103 | 82 | ||||||
| Lions Gate Entertainment | ||||||||
| 10.250%, 11/01/16(A) | 1,200 | 1,335 | ||||||
| Mashantucket Western Pequot Tribe | ||||||||
| 8.500%, 11/15/15(A) (B) | 170 | 15 | ||||||
| MGM Resorts International | ||||||||
| 11.375%, 03/01/18 | 400 | 472 | ||||||
| 8.625%, 02/01/19(A) | 975 | 1,063 | ||||||
| Mohegan Tribal Gaming Authority | ||||||||
| 11.000%, 09/15/18(A) | 100 | 70 | ||||||
| NAI Entertainment Holdings | ||||||||
| 8.250%, 12/15/17(A) | 450 | 502 | ||||||
| Regal Entertainment Group | ||||||||
| 9.125%, 08/15/18 | 225 | 251 | ||||||
| Scientific Games | ||||||||
| 8.125%, 09/15/18 | 325 | 355 | ||||||
| Seminole Indian Tribe of Florida | ||||||||
| 7.750%, 10/01/17(A) | 360 | 395 | ||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 59
| schedule of investments |
September 30, 2012 |
High Yield Bond Fund (continued) |
Description | Face Amount (000) | Value (000) |
| Shingle Springs Tribal Gaming Authority | ||||||||
| 9.375%, 06/15/15(A) | $ | 100 | $ | 83 | ||||
| Snoqualmie Entertainment Authority (A) | ||||||||
| 9.125%, 02/01/15 | 255 | 258 | ||||||
| 4.476%, 02/01/14(E) | 450 | 446 | ||||||
| Speedway Motorsports | ||||||||
| 6.750%, 02/01/19 | 250 | 266 | ||||||
| Sugarhouse HSP Gaming Prop Mezz | ||||||||
| 8.625%, 04/15/16(A) | 700 | 751 | ||||||
| Tunica-Biloxi Gaming Authority | ||||||||
| 9.000%, 11/15/15(A) | 125 | 111 | ||||||
| Vail Resorts | ||||||||
| 6.500%, 05/01/19 | 500 | 544 | ||||||
| Waterford Gaming | ||||||||
| 8.625%, 09/15/14(A) (F) | 50 | 16 | ||||||
| Wynn Las Vegas | ||||||||
| 7.875%, 05/01/20 | 175 | 192 | ||||||
| 7.750%, 08/15/20 | 400 | 445 | ||||||
| 5.375%, 03/15/22(A) | 600 | 609 | ||||||
| Yonkers Racing | ||||||||
| 11.375%, 07/15/16(A) | 975 | 1,053 | ||||||
Total Entertainment & Gaming | 12,550 | |||||||
| Financial Services [3.0%] | ||||||||
| CNH Capital | ||||||||
| 6.250%, 11/01/16(A) | 250 | 271 | ||||||
| Credit Acceptance | ||||||||
| 9.125%, 02/01/17 | 500 | 551 | ||||||
| Icahn Enterprises | ||||||||
| 8.000%, 01/15/18 | 450 | 483 | ||||||
| 7.750%, 01/15/16 | 1,150 | 1,199 | ||||||
| Nationstar Mortgage | ||||||||
| 10.875%, 04/01/15 | 50 | 54 | ||||||
| 9.625%, 05/01/19(A) | 800 | 870 | ||||||
| 7.875%, 10/01/20(A) | 240 | 244 | ||||||
| Pinnacle Foods Finance | ||||||||
| 9.250%, 04/01/15 | 208 | 213 | ||||||
| Rural | ||||||||
| 10.125%, 07/15/19(A) | 400 | 397 | ||||||
| Serta Simmons Holdings | ||||||||
| 8.125%, 10/01/20(A) | 300 | 298 | ||||||
Total Financial Services | 4,580 | |||||||
Description | Face Amount (000) | Value (000) |
| Food, Beverage & Tobacco [2.6%] | ||||||||
| Beverages & More | ||||||||
| 9.625%, 10/01/14(A) | $ | 750 | $ | 772 | ||||
| Bumble Bee Acquisition | ||||||||
| 9.000%, 12/15/17(A) | 665 | 696 | ||||||
| Bumble Bee Holdco SCA | ||||||||
| 9.625%, 03/15/18(A) | 1,000 | 957 | ||||||
| Darling International | ||||||||
| 8.500%, 12/15/18 | 350 | 399 | ||||||
| Le-Nature's | ||||||||
| 9.000%, 06/15/13(A) (B) (F) | 150 | 3 | ||||||
| US Foods | ||||||||
| 8.500%, 06/30/19(A) | 1,050 | 1,095 | ||||||
Total Food, Beverage & Tobacco | 3,922 | |||||||
| Gold Mining [0.4%] | ||||||||
| IAMGOLD | ||||||||
6.750%, 10/01/20(A) | 550 | 539 | ||||||
| Human Resources [0.5%] | ||||||||
| Emergency Medical Services | ||||||||
8.125%, 06/01/19 | 650 | 689 | ||||||
| Insurance [1.9%] | ||||||||
| Hub International | ||||||||
| 8.125%, 10/15/18(A) | 350 | 354 | ||||||
| Ironshore Holdings US | ||||||||
| 8.500%, 05/15/20(A) | 950 | 1,048 | ||||||
| National Life Insurance | ||||||||
| 10.500%, 09/15/39(A) | 150 | 200 | ||||||
| USI Holdings (A) | ||||||||
| 9.750%, 05/15/15 | 758 | 767 | ||||||
| 4.309%, 11/15/14(E) | 650 | 629 | ||||||
Total Insurance | 2,998 | |||||||
| Internet & Catalog Retail [0.9%] | ||||||||
| Expedia | ||||||||
5.950%, 08/15/20 | 1,250 | 1,379 | ||||||
| Internet Connectiv Svcs [0.5%] | ||||||||
| Zayo Group | ||||||||
| 10.125%, 07/01/20 | 510 | 564 | ||||||
| 8.125%, 01/01/20 | 250 | 273 | ||||||
Total Internet Connectiv Svcs | 837 | |||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 60
| schedule of investments |
September 30, 2012 |
High Yield Bond Fund (continued) |
Description | Face Amount (000) | Value (000) |
| Investment Banker/Broker Dealer [1.4%] | ||||||||
| Jefferies Group | ||||||||
| 8.500%, 07/15/19 | $ | 240 | $ | 275 | ||||
| Nuveen Investments | ||||||||
| 9.125%, 10/15/17(A) | 1,775 | 1,762 | ||||||
Total Investment Banker/Broker Dealer | 2,037 | |||||||
| Machinery [1.5%] | ||||||||
| Tempel Steel | ||||||||
| 12.000%, 08/15/16(A) | 500 | 489 | ||||||
| Thermadyne Holdings | ||||||||
| 9.000%, 12/15/17 | 1,670 | 1,778 | ||||||
Total Machinery | 2,267 | |||||||
| Medical Products & Services [3.8%] | ||||||||
| Apria Healthcare Group | ||||||||
| 12.375%, 11/01/14 | 1,185 | 1,156 | ||||||
| 11.250%, 11/01/14 | 600 | 615 | ||||||
| Biomet | ||||||||
| 11.625%, 10/15/17 | 647 | 689 | ||||||
| BioScrip | ||||||||
| 10.250%, 10/01/15 | 600 | 646 | ||||||
| CHS | ||||||||
| 5.125%, 08/15/18 | 250 | 259 | ||||||
| HCA | ||||||||
| 7.500%, 02/15/22 | 1,225 | 1,387 | ||||||
| OnCure Holdings | ||||||||
| 11.750%, 05/15/17 | 500 | 295 | ||||||
| Physio-Control International | ||||||||
| 9.875%, 01/15/19(A) | 125 | 137 | ||||||
| Symbion | ||||||||
| 11.000%, 08/23/15 | 418 | 416 | ||||||
| Tenet Healthcare | ||||||||
| 6.250%, 11/01/18 | 350 | 386 | ||||||
Total Medical Products & Services | 5,986 | |||||||
| Metal-Copper [0.5%] | ||||||||
| KGHM International | ||||||||
7.750%, 06/15/19(A) | 800 | 824 | ||||||
| Metals & Mining [1.6%] | ||||||||
| AM Castle | ||||||||
| 12.750%, 12/15/16 | 220 | 249 | ||||||
| Midwest Vanadium | ||||||||
| 11.500%, 02/15/18(A) | 500 | 305 | ||||||
| Mirabela Nickel | ||||||||
| 8.750%, 04/15/18(A) | 870 | 652 | ||||||
Description | Face Amount (000) | Value (000) |
| Noranda Aluminum Acquisition | ||||||||
| 4.730%, 05/15/15(E) | $ | 673 | $ | 640 | ||||
| Novelis | ||||||||
| 8.375%, 12/15/17 | 500 | 546 | ||||||
Total Metals & Mining | 2,392 | |||||||
| Miscellaneous Business Services [0.2%] | ||||||||
| MCBC Holdings | ||||||||
| 6.817%, 10/15/14(A) (F) | 50 | 5 | ||||||
| Sitel | ||||||||
| 11.000%, 08/01/17(A) | 340 | 342 | ||||||
Total Miscellaneous Business Services | 347 | |||||||
| Miscellaneous Manufacturing [2.5%] | ||||||||
| AGY Holding | ||||||||
| 11.000%, 11/15/14 | 100 | 49 | ||||||
| Atkore International | ||||||||
| 9.875%, 01/01/18 | 435 | 423 | ||||||
| CEVA Group (A) | ||||||||
| 11.625%, 10/01/16 | 250 | 256 | ||||||
| 11.500%, 04/01/18 | 100 | 88 | ||||||
| 8.375%, 12/01/17 | 1,275 | 1,229 | ||||||
| Coleman Cable | ||||||||
| 9.000%, 02/15/18 | 1,175 | 1,252 | ||||||
| Rivers Pittsburgh Borrower | ||||||||
| 9.500%, 06/15/19(A) | 275 | 292 | ||||||
| Thermon Industries | ||||||||
| 9.500%, 05/01/17 | 241 | 269 | ||||||
Total Miscellaneous Manufacturing | 3,858 | |||||||
| Multi-line Insurance [0.1%] | ||||||||
| Kemper | ||||||||
6.000%, 05/15/17 | 195 | 212 | ||||||
| Non-Ferrous Metals [0.4%] | ||||||||
| Horsehead Holding | ||||||||
10.500%, 06/01/17(A) | 550 | 553 | ||||||
| Office Automation and Equip [0.3%] | ||||||||
| CDW | ||||||||
8.000%, 12/15/18 | 400 | 442 | ||||||
| Oil-Field Services [2.5%] | ||||||||
| Exterran Holdings | ||||||||
| 7.250%, 12/01/18 | 1,600 | 1,684 | ||||||
| Hiland Partners | ||||||||
| 7.250%, 10/01/20(A) | 725 | 754 | ||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 61
| schedule of investments |
September 30, 2012 |
High Yield Bond Fund (continued) |
Description | Face Amount (000) | Value (000) |
| SESI | ||||||||
| 7.125%, 12/15/21 | $ | 1,000 | $ | 1,105 | ||||
| 6.375%, 05/01/19 | 300 | 321 | ||||||
Total Oil-Field Services | 3,864 | |||||||
| Paper & Related Products [0.1%] | ||||||||
| Verso Paper Holdings | ||||||||
8.750%, 02/01/19 | 300 | 144 | ||||||
| Petroleum & Fuel Products [7.6%] | ||||||||
| Bill Barrett | ||||||||
| 9.875%, 07/15/16 | 250 | 275 | ||||||
| 7.625%, 10/01/19 | 1,325 | 1,404 | ||||||
| BreitBurn Energy Partners | ||||||||
| 7.875%, 04/15/22(A) | 1,660 | 1,718 | ||||||
| Carrizo Oil & Gas | ||||||||
| 7.500%, 09/15/20 | 175 | 178 | ||||||
| Continental Resources | ||||||||
| 7.375%, 10/01/20 | 500 | 560 | ||||||
| Crestwood Midstream Partners | ||||||||
| 7.750%, 04/01/19 | 1,550 | 1,573 | ||||||
| Eagle Rock Energy Partners | ||||||||
| 8.375%, 06/01/19(A) | 1,750 | 1,719 | ||||||
| EP Energy | ||||||||
| 6.875%, 05/01/19(A) | 325 | 348 | ||||||
| Midstates Petroleum | ||||||||
| 10.750%, 10/01/20(A) | 400 | 417 | ||||||
| Milagro Oil & Gas | ||||||||
| 10.500%, 05/15/16 | 400 | 284 | ||||||
| Newfield Exploration | ||||||||
| 5.625%, 07/01/24 | 300 | 333 | ||||||
| Penn Virginia | ||||||||
| 7.250%, 04/15/19 | 900 | 837 | ||||||
| Precision Drilling | ||||||||
| 6.500%, 12/15/21 | 400 | 427 | ||||||
| SandRidge Energy | ||||||||
| 8.125%, 10/15/22(A) | 1,000 | 1,065 | ||||||
| 8.000%, 06/01/18(A) | 150 | 158 | ||||||
| 7.500%, 03/15/21 | 250 | 258 | ||||||
Total Petroleum & Fuel Products | 11,554 | |||||||
| Phys Therapy/Rehab Cntrs [0.4%] | ||||||||
| Physiotherapy Associates Holdings | ||||||||
11.875%, 05/01/19(A) | 595 | 610 | ||||||
Description | Face Amount (000) | Value (000) |
| Printing & Publishing [0.1%] | ||||||||
| Houghton Mifflin Harcourt Publishers | ||||||||
10.500%, 06/01/19(A) (B) | $ | 400 | $ | 217 | ||||
| Property/Casualty Ins [0.2%] | ||||||||
| QBE Capital Funding III | ||||||||
7.250%, 05/24/41(A) (E) | 250 | 253 | ||||||
| Publishing-Books [0.2%] | ||||||||
| Baker & Taylor Acquisitions | ||||||||
15.000%, 04/01/17(A) | 475 | 366 | ||||||
| Real Estate [0.4%] | ||||||||
| Kennedy-Wilson | ||||||||
8.750%, 04/01/19 | 600 | 639 | ||||||
| Real Estate Investment Trusts [0.2%] | ||||||||
| Entertainment Properties Trust | ||||||||
5.750%, 08/15/22 | 360 | 374 | ||||||
| Research and Development [1.4%] | ||||||||
| Alion Science and Technology | ||||||||
| 12.000%, 11/01/14 | 602 | 564 | ||||||
| 10.250%, 02/01/15 | 330 | 188 | ||||||
| Catalent Pharma Solutions | ||||||||
| 9.500%, 04/15/15 | 689 | 702 | ||||||
| Jaguar Holding II | ||||||||
| 9.500%, 12/01/19(A) | 675 | 758 | ||||||
Total Research and Development | 2,212 | |||||||
| Retail [5.6%] | ||||||||
| Academy | ||||||||
| 9.250%, 08/01/19(A) | 750 | 824 | ||||||
| AmeriGas Finance | ||||||||
| 7.000%, 05/20/22 | 1,420 | 1,530 | ||||||
| Brands | ||||||||
| 5.625%, 02/15/22 | 250 | 269 | ||||||
| Burlington Coat Factory Warehouse | ||||||||
| 10.000%, 02/15/19 | 1,500 | 1,659 | ||||||
| Fifth & Pacific | ||||||||
| 10.500%, 04/15/19(A) | 940 | 1,061 | ||||||
| GRD Holdings III | ||||||||
| 10.750%, 06/01/19(A) | 1,285 | 1,288 | ||||||
| Logan's Roadhouse | ||||||||
| 10.750%, 10/15/17 | 220 | 215 | ||||||
| Mobile Mini | ||||||||
| 7.875%, 12/01/20 | 755 | 819 | ||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 62
| schedule of investments |
September 30, 2012 |
High Yield Bond Fund (continued) |
Description | Face Amount (000) | Value (000) |
| Party City Holdings | ||||||||
| 8.875%, 08/01/20(A) | $ | 425 | $ | 453 | ||||
| Wok Acquisition | ||||||||
| 10.250%, 06/30/20(A) | 450 | 476 | ||||||
Total Retail | 8,594 | |||||||
| Rubber & Plastic [0.2%] | ||||||||
| Goodyear Tire & Rubber | ||||||||
7.000%, 05/15/22 | 250 | 265 | ||||||
| Schools-Day Care [0.2%] | ||||||||
| Knowledge Universe Education | ||||||||
7.750%, 02/01/15(A) | 400 | 344 | ||||||
| Shipbuilding [0.4%] | ||||||||
| Huntington Ingalls Industries | ||||||||
| 7.125%, 03/15/21 | 250 | 269 | ||||||
| 6.875%, 03/15/18 | 250 | 271 | ||||||
Total Shipbuilding | 540 | |||||||
| Steel & Steel Works [0.4%] | ||||||||
| Standard Steel | ||||||||
12.000%, 05/01/15(A) | 600 | 658 | ||||||
| Telephones & Telecommunications [5.1%] | ||||||||
| Avaya | ||||||||
| 10.125%, 11/01/15 | 1,280 | 1,142 | ||||||
| 9.750%, 11/01/15 | 250 | 222 | ||||||
| 7.000%, 04/01/19(A) | 420 | 390 | ||||||
| Clearwire Communications | ||||||||
| 12.000%, 12/01/15(A) | 280 | 277 | ||||||
| CommScope | ||||||||
| 8.250%, 01/15/19(A) | 1,325 | 1,431 | ||||||
| Level 3 Financing | ||||||||
| 10.000%, 02/01/18 | 250 | 278 | ||||||
| 4.469%, 02/15/15(E) | 1,250 | 1,247 | ||||||
| SBA Telecommunications | ||||||||
| 5.750%, 07/15/20(A) | 300 | 315 | ||||||
| Sprint Nextel | ||||||||
| 7.000%, 03/01/20(A) | 1,150 | 1,288 | ||||||
| Syniverse Holdings | ||||||||
| 9.125%, 01/15/19 | 675 | 726 | ||||||
| UPCB Finance | ||||||||
| 7.250%, 11/15/21(A) | 500 | 544 | ||||||
Total Telephones & Telecommunications | 7,860 | |||||||
Description | Face Amount (000) | Value (000) |
| Textile-Home Furnishings [0.5%] | ||||||||
| Empire Today | ||||||||
11.375%, 02/01/17(A) | $ | 750 | $ | 793 | ||||
| Transactional Software [0.7%] | ||||||||
| Open Solutions | ||||||||
9.750%, 02/01/15(A) | 1,200 | 1,020 | ||||||
| Transportation Services [4.4%] | ||||||||
| ACL I | ||||||||
| 10.625%, 02/15/16 | 539 | 528 | ||||||
| Commercial Barge Line | ||||||||
| 12.500%, 07/15/17 | 250 | 279 | ||||||
| Florida East Coast Railway | ||||||||
| 8.125%, 02/01/17 | 750 | 789 | ||||||
| Marquette Transportation | ||||||||
| 10.875%, 01/15/17 | 1,160 | 1,221 | ||||||
| Pegasus Solutions | ||||||||
| 10.500%, 04/15/15(A) | 100 | 75 | ||||||
| Quality Distribution | ||||||||
| 9.875%, 11/01/18 | 800 | 872 | ||||||
| Rural/Metro | ||||||||
| 10.125%, 07/15/19(A) | 650 | 645 | ||||||
| Sabre | ||||||||
| 8.500%, 05/15/19(A) | 595 | 611 | ||||||
| Sabre Holdings | ||||||||
| 8.350%, 03/15/16 | 1,245 | 1,264 | ||||||
| Stena | ||||||||
| 7.000%, 12/01/16 | 150 | 149 | ||||||
| Travelport | ||||||||
| 11.875%, 09/01/16 | 90 | 34 | ||||||
| 9.875%, 09/01/14 | 300 | 240 | ||||||
Total Transportation Services | 6,707 | |||||||
| Web Hosting/Design [0.2%] | ||||||||
| Equinix | ||||||||
7.000%, 07/15/21 | 250 | 280 | ||||||
| X-Ray Equipment [0.5%] | ||||||||
| Hologic | ||||||||
6.250%, 08/01/20(A) | 700 | 744 | ||||||
Total Corporate Bonds (Cost $137,417) | 140,968 | |||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 63
| schedule of investments |
September 30, 2012 |
High Yield Bond Fund (concluded) |
Description | Face Amount (000)/Shares | Value (000) | ||||||
| Warrants [0.1%] | ||||||||
| Alion Science and Technology, | ||||||||
| Expires 03/15/17 * | $ | 380 | $ | — | ||||
| CUI Acquisition (F)(G)(H) | 2,756 | 125 | ||||||
Total Warrants (Cost $250) | 125 | |||||||
| Special Stock [0.0%] | ||||||||
| Broadcasting & Cable [0.0%] | ||||||||
| Adelphia CVV (F)(G) | 8,500 | 7 | ||||||
Total Special Stock (Cost $9) | 7 | |||||||
| Convertible Bond [0.0%] | ||||||||
| Food, Beverage & Tobacco [0.0%] | ||||||||
| Vector Group | ||||||||
| 3.875%, 06/15/26(E) | 54 | 59 | ||||||
Total Convertible Bond (Cost $55) | 59 | |||||||
| Short-Term Investments [6.0%] | ||||||||
CNI Prime Money Market Fund, Cl I, 0.030%**† | 4,630,269 | 4,630 | ||||||
| SEI Daily Income Trust, Prime Obligation Fund, Cl A, 0.070%** | 4,630,269 | 4,630 | ||||||
Total Short-Term Investments (Cost $9,261) | 9,260 | |||||||
Total Investments [97.8%] (Cost $146,992) | $ | 150,419 | ||||||
Percentages are based on Net Assets of $153,765 ($ Thousands).
| * | Non-income producing security. |
| ** | The rate reported is the 7-day effective yield as of September 30, 2012. |
| † | Investment in Affiliate. |
| (A) | Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration normally to qualified institutions. On September 30, 2012, the value of these securities amounted to $67,394 ($ Thousands), representing 43.8% of the net assets of the Fund. |
| (B) | In default on interest payments. Rate shown represents the last coupon rate prior to default. |
| (C) | Payment in Kind |
| (D) | Step Bond — The rate reported is the rate in effect on September 30, 2012. The coupon on a step bond changes on a specific date. |
| (E) | Floating Rate Security — The rate reported is the rate in effect on September 30, 2012. |
| (F) | Security considered illiquid. The total value of such securities as of September 30, 2012 was $156 ($ Thousands) and represented 0.10% of net assets. |
| (G) | Securities are fair valued. The total value of such securities as of September 30, 2012 was $132 ($ Thousands) and represented 0.09% of net assets of the Fund. |
| (H) | This warrant is a result of the restructuring of Cleveland Unlimited, has an exercise price of $0.0001 per share of common stock and does not have an expiration date. |
Cl — Class
Ser — Series
Amounts designated as “—” are either $0 or have been rounded to $0.
The following is a summary of the inputs used as of September 30, 2012 in valuing the Fund’s investments carried at value ($ Thousands):
| Investments in Securities | Level 1 | Level 2 | Level 3(1) | Total | ||||||||||||
| Corporate Bonds | $ | — | $ | 140,960 | $ | 8 | $ | 140,968 | ||||||||
| Warrants | — | — | 125 | 125 | ||||||||||||
| Special Stock | — | — | 7 | 7 | ||||||||||||
| Convertible Bond | — | 59 | — | 59 | ||||||||||||
| Short-Term Investments | 9,260 | — | — | 9,260 | ||||||||||||
| Total Investments in Securities | $ | 9,260 | $ | 141,019 | $ | 140 | $ | 150,419 | ||||||||
| (1) | Of the $140 ($ Thousands) in Level 3 securities as of September 30, 2012, $132 ($ Thousands) or 0.09% are not valued via third party pricing vendors and broker quotes. If significant, the disclosure of the unobservable inputs and the interrelationships and sensitivity between these inputs are required for those Level 3 securities that are not valued by third party pricing vendors or broker quotes. |
For the period ended September 30, 2012, there have been no transfers between Level 1 and Level 2 assets and liabilities. For the period ended September 30, 2012, there have been no transfers between Level 2 and Level 3 assets and liabilities. Transfers between Levels are recognized at period end.
For more information on valuation inputs, see Note 2 — Significant Accounting Policies in the Notes to Financial Statements.
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 64
| schedule of investments |
September 30, 2012 |
Multi-Asset Fund |
Description | Shares | Value (000) |
| Unaffiliated Registered Investment Companies [47.0%] | ||||||||
| DoubleLine Total Return Bond Fund | 237,835 | $ | 2,711 | |||||
| Fidelity Floating Rate High Income Fund | 197,381 | 1,962 | ||||||
| Harbor High Yield Bond Fund | 76,087 | 845 | ||||||
| ING Global Real Estate Fund | 88,917 | 1,553 | ||||||
| PIMCO Emerging Markets Bond Fund, Cl I | 112,994 | 1,389 | ||||||
| Principal Preferred Securities Fund | 293,860 | 3,053 | ||||||
| Vanguard Short-Term Bond Index Fund | 891,802 | 9,525 | ||||||
Total Unaffiliated Registered Investment Companies (Cost $20,439) | 21,038 | |||||||
| Exchange-Traded Funds [29.3%] | ||||||||
| Powershares DB Gold | 39,039 | 2,385 | ||||||
| SPDR S&P 500 | 29,607 | 4,261 | ||||||
| SPDR S&P Dividend | 36,117 | 2,098 | ||||||
| Vanguard Dividend Appreciation | 35,302 | 2,107 | ||||||
| Vanguard Global Ex-U.S. Real Estate | 13,037 | 671 | ||||||
| Vanguard REIT | 10,039 | 652 | ||||||
| Wisdomtree Emerging Markets Equity Income Fund | 17,498 | 940 | ||||||
Total Exchange-Traded Funds (Cost $11,975) | 13,114 | |||||||
Affiliated Registered Investment Companies† [20.4%] | ||||||||
| CNI Corporate Bond Fund, Cl I | 290,725 | 3,169 | ||||||
| CNI Government Bond Fund, Cl I | 213,166 | 2,287 | ||||||
| CNI High Yield Bond Fund, Cl I | 148,846 | 1,286 | ||||||
| CNI Limited Maturity Fixed Income Fund, Cl I | 211,748 | 2,382 | ||||||
Total Affiliated Registered Investment Companies (Cost $8,961) | 9,124 | |||||||
Description | Shares | Value (000) |
| Short-Term Investments [3.0%] | ||||||||
CNI Prime Money Market Fund, Cl I, 0.030% *† | 682,468 | $ | 682 | |||||
| SEI Daily Income Trust, Prime Obligation Fund, Cl A, 0.070% * | 682,468 | 682 | ||||||
Total Short-Term Investments (Cost $1,365) | 1,364 | |||||||
Total Investments [99.7%] (Cost $42,740) | $ | 44,640 | ||||||
Percentages are based on Net Assets of $44,767 ($ Thousands).
| * | The rate reported is the 7-day effective yield as of September 30, 2012. |
| † | Investment in Affiliate. |
Cl — Class
REIT — Real Estate Investment Trust
S&P — Standard & Poor’s
SPDR — Standard & Poor’s Depositary Receipts
As of September 30, 2012, all of the Fund’s investments are Level 1.
For the year ended September 30, 2012, there have been no transfers between Level 1 and Level 2 assets and liabilities. Transfers between Levels are recognized at period end.
For more information on valuation inputs, see Note 2 — Significant Accounting Policies in the Notes to Financial Statements.
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 65
| schedule of investments |
September 30, 2012 |
Diversified Equity Fund |
Description | Shares | Value (000) |
| Common Stock [97.8%] | ||||||||
| Aerospace & Defense [1.3%] | ||||||||
| Boeing | 579 | $ | 40 | |||||
| General Dynamics | 284 | 19 | ||||||
| Honeywell International | 668 | 40 | ||||||
| L-3 Communications Holdings, Cl 3 | 83 | 6 | ||||||
| Lockheed Martin | 230 | 21 | ||||||
| Northrop Grumman | 211 | 14 | ||||||
| Precision Castparts | 944 | 154 | ||||||
| Raytheon | 3,599 | 206 | ||||||
| Rockwell Collins | 122 | 7 | ||||||
| United Technologies | 717 | 56 | ||||||
Total Aerospace & Defense | 563 | |||||||
| Airlines [0.0%] | ||||||||
Southwest Airlines | 635 | 6 | ||||||
| Apparel/Textiles [1.1%] | ||||||||
| Coach | 244 | 14 | ||||||
| Fossil * | 46 | 4 | ||||||
| Lululemon Athletica * | 1,330 | 98 | ||||||
| Michael Kors Holdings * | 1,790 | 95 | ||||||
| Nike, Cl B | 314 | 30 | ||||||
| Ralph Lauren, Cl A | 962 | 145 | ||||||
| Under Armour, Cl A * | 1,570 | 88 | ||||||
| VF | 75 | 12 | ||||||
Total Apparel/Textiles | 486 | |||||||
Description | Shares | Value (000) |
| Auto Components [0.0%] | ||||||||
| BorgWarner * | 97 | $ | 7 | |||||
| Goodyear Tire & Rubber * | 210 | 2 | ||||||
Total Auto Components | 9 | |||||||
| Automotive [3.4%] | ||||||||
| AutoZone * | 312 | 116 | ||||||
| Ford Motor | 40,961 | 404 | ||||||
| Harley-Davidson | 195 | 8 | ||||||
| Johnson Controls | 14,384 | 394 | ||||||
| Paccar | 13,902 | 556 | ||||||
Total Automotive | 1,478 | |||||||
| Banks [3.6%] | ||||||||
| Bank of America | 9,215 | 81 | ||||||
| Bank of New York Mellon | 1,010 | 23 | ||||||
| CIT Group * | 12,500 | 493 | ||||||
| Citigroup | 2,507 | 82 | ||||||
| Comerica | 165 | 5 | ||||||
| Fifth Third Bancorp | 786 | 12 | ||||||
| First Horizon National | 212 | 2 | ||||||
| Huntington Bancshares | 734 | 5 | ||||||
| KeyCorp | 807 | 7 | ||||||
| Leucadia National | 170 | 4 | ||||||
| M&T Bank | 3,103 | 295 | ||||||
| Moody's | 165 | 7 | ||||||
| PNC Financial Services Group | 453 | 29 | ||||||
| State Street | 410 | 17 | ||||||
| SunTrust Banks | 460 | 13 | ||||||
| US Bancorp | 10,021 | 344 | ||||||
| Wells Fargo | 4,200 | 145 | ||||||
| Zions Bancorporation | 158 | 3 | ||||||
Total Banks | 1,567 | |||||||
| Beauty Products [0.6%] | ||||||||
| Estee Lauder, Cl A | 2,005 | 124 | ||||||
| Procter & Gamble | 2,355 | 163 | ||||||
Total Beauty Products | 287 | |||||||
| Biomedical Research & Products [0.1%] | ||||||||
Celgene * | 369 | 28 | ||||||
| Biotechnology [1.5%] | ||||||||
| Alexion Pharmaceuticals * | 1,875 | 214 | ||||||
| Amgen | 659 | 56 | ||||||
| Ariad Pharmaceuticals * | 2,730 | 66 | ||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 66
| schedule of investments |
September 30, 2012 |
Diversified Equity Fund (continued) |
Description | Shares | Value (000) |
| Biogen Idec * | 1,722 | $ | 257 | |||||
| Gilead Sciences * | 647 | 43 | ||||||
Total Biotechnology | 636 | |||||||
| Broadcasting & Cable [3.2%] | ||||||||
| Cisco Systems | 35,223 | 672 | ||||||
| F5 Networks * | 1,198 | 125 | ||||||
| Harris | 96 | 5 | ||||||
| JDS Uniphase * | 199 | 3 | ||||||
| Motorola Solutions | 245 | 12 | ||||||
| Palo Alto Networks * | 1,200 | 74 | ||||||
| Qualcomm | 7,546 | 472 | ||||||
Total Broadcasting & Cable | 1,363 | |||||||
| Building & Construction [1.1%] | ||||||||
| DR Horton | 237 | 5 | ||||||
| Masco | 305 | 5 | ||||||
| Owens Corning * | 13,700 | 458 | ||||||
Total Building & Construction | 468 | |||||||
| Business Services [2.1%] | ||||||||
| Accenture, Cl A | 543 | 38 | ||||||
| Automatic Data Processing | 415 | 24 | ||||||
| Cognizant Technology Solutions, Cl A * | 255 | 18 | ||||||
| Computer Sciences | 133 | 4 | ||||||
| eBay * | 5,342 | 259 | ||||||
| Fidelity National Information Services | 4,794 | 150 | ||||||
| Fiserv * | 116 | 9 | ||||||
| Mastercard, Cl A | 92 | 41 | ||||||
| Omnicom Group | 227 | 12 | ||||||
| Paychex | 276 | 9 | ||||||
| SAIC | 243 | 3 | ||||||
| Total System Services | 138 | 3 | ||||||
| Visa, Cl A | 2,417 | 325 | ||||||
| Xerox | 1,118 | 8 | ||||||
Total Business Services | 903 | |||||||
| Chemicals [2.6%] | ||||||||
| Air Products & Chemicals | 181 | 15 | ||||||
| Airgas | 59 | 5 | ||||||
| CF Industries Holdings | 54 | 12 | ||||||
| Dow Chemical | 1,024 | 30 | ||||||
| Eastman Chemical | 131 | 7 | ||||||
| Ecolab | 225 | 15 | ||||||
| EI du Pont de Nemours | 796 | 40 | ||||||
Description | Shares | Value (000) |
| FMC | 118 | $ | 6 | |||||
| International Flavors & Fragrances | 70 | 4 | ||||||
| LyondellBasell Industries, Cl A | 6,290 | 325 | ||||||
| Monsanto | 3,545 | 323 | ||||||
| Mosaic | 237 | 14 | ||||||
| Potash Corp of Saskatchewan | 6,600 | 287 | ||||||
| PPG Industries | 131 | 15 | ||||||
| Praxair | 255 | 26 | ||||||
| Sigma-Aldrich | 103 | 7 | ||||||
Total Chemicals | 1,131 | |||||||
| Commercial Banks [1.6%] | ||||||||
| BB&T | 20,697 | 686 | ||||||
| Regions Financial | 1,209 | 9 | ||||||
Total Commercial Banks | 695 | |||||||
| Communication & Media [2.0%] | ||||||||
| Cablevision Systems, Cl A | 185 | 3 | ||||||
| CBS, Cl B | 509 | 18 | ||||||
| Comcast, Cl A | 7,428 | 266 | ||||||
| DIRECTV * | 537 | 28 | ||||||
| Discovery Communications, Cl A * | 211 | 13 | ||||||
| Interpublic Group | 374 | 4 | ||||||
| McGraw-Hill | 239 | 13 | ||||||
| News, Cl A | 1,741 | 43 | ||||||
| Scripps Networks Interactive, Cl A | 74 | 4 | ||||||
| Time Warner | 9,278 | 421 | ||||||
| Time Warner Cable, Cl A | 262 | 25 | ||||||
| Viacom, Cl B | 404 | 22 | ||||||
| Washington Post, Cl B | 4 | 1 | ||||||
Total Communication & Media | 861 | |||||||
| Computer & Electronics Retail [0.0%] | ||||||||
GameStop, Cl A | 106 | 2 | ||||||
| Computer Software [1.7%] | ||||||||
| Adobe Systems * | 420 | 14 | ||||||
| CA | 293 | 8 | ||||||
| Microsoft | 20,023 | 596 | ||||||
| Oracle | 3,256 | 102 | ||||||
| Symantec * | 601 | 11 | ||||||
Total Computer Software | 731 | |||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 67
| schedule of investments |
September 30, 2012 |
Diversified Equity Fund (continued) |
Description | Shares | Value (000) |
| Computer System Design & Services [5.4%] | ||||||||
| Apple | 2,810 | $ | 1,875 | |||||
| Dell | 1,246 | 12 | ||||||
| Fusion-io * | 2,430 | 74 | ||||||
| Hewlett-Packard | 1,681 | 29 | ||||||
| IBM | 918 | 191 | ||||||
| Lexmark International, Cl A | 60 | 1 | ||||||
| NetApp * | 311 | 10 | ||||||
| SanDisk * | 207 | 9 | ||||||
| Seagate Technology | 302 | 9 | ||||||
| Stratasys * | 1,540 | 84 | ||||||
| Teradata * | 144 | 11 | ||||||
| Western Digital | 190 | 7 | ||||||
Total Computer System Design & Services | 2,312 | |||||||
| Computers & Peripherals [1.0%] | ||||||||
EMC * | 16,535 | 451 | ||||||
| Construction & Engineering [0.0%] | ||||||||
| Jacobs Engineering Group * | 111 | 4 | ||||||
| Quanta Services * | 182 | 5 | ||||||
Total Construction & Engineering | 9 | |||||||
| Construction Materials [0.0%] | ||||||||
Vulcan Materials | 110 | 5 | ||||||
| Consumer Products & Services [0.2%] | ||||||||
| Clorox | 110 | 8 | ||||||
| Colgate-Palmolive | 381 | 41 | ||||||
| Hasbro | 99 | 4 | ||||||
| Kimberly-Clark | 338 | 29 | ||||||
| Mattel | 291 | 10 | ||||||
Total Consumer Products & Services | 92 | |||||||
| Containers & Packaging [0.9%] | ||||||||
| Ball | 133 | 5 | ||||||
| Bemis | 88 | 3 | ||||||
| Crown Holdings * | 10,400 | 382 | ||||||
| Owens-Illinois * | 141 | 3 | ||||||
Total Containers & Packaging | 393 | |||||||
| Distributors [0.0%] | ||||||||
Genuine Parts | 133 | 8 | ||||||
Description | Shares | Value (000) |
| Diversified Consumer Services [0.0%] | ||||||||
| DeVry | 49 | $ | 1 | |||||
| H&R Block | 232 | 4 | ||||||
Total Diversified Consumer Services | 5 | |||||||
| Diversified Manufacturing [0.7%] | ||||||||
| 3M | 544 | 50 | ||||||
| Danaher | 499 | 28 | ||||||
| General Electric | 9,028 | 205 | ||||||
| Parker Hannifin | 128 | 11 | ||||||
| Textron | 240 | 6 | ||||||
Total Diversified Manufacturing | 300 | |||||||
| Diversified Metals & Mining [0.2%] | ||||||||
| Alcoa | 912 | 8 | ||||||
| Allegheny Technologies | 92 | 3 | ||||||
| Cliffs Natural Resources | 122 | 5 | ||||||
| Freeport-McMoRan Copper & Gold, Cl B | 812 | 32 | ||||||
| Newmont Mining | 424 | 24 | ||||||
| Titanium Metals | 63 | 1 | ||||||
| United States Steel | 123 | 2 | ||||||
Total Diversified Metals & Mining | 75 | |||||||
| Drugs [3.6%] | ||||||||
| Abbott Laboratories | 1,342 | 92 | ||||||
| Allergan | 2,173 | 199 | ||||||
| AmerisourceBergen, Cl A | 215 | 8 | ||||||
| Bristol-Myers Squibb | 7,036 | 238 | ||||||
| Eli Lilly | 873 | 41 | ||||||
| Forest Laboratories * | 200 | 7 | ||||||
| Johnson & Johnson | 2,357 | 163 | ||||||
| Merck | 2,604 | 118 | ||||||
| Mylan * | 16,147 | 394 | ||||||
| Perrigo | 1,045 | 121 | ||||||
| Pfizer | 6,387 | 159 | ||||||
| Watson Pharmaceuticals * | 109 | 9 | ||||||
Total Drugs | 1,549 | |||||||
| Electrical Equipment [0.1%] | ||||||||
Emerson Electric | 622 | 30 | ||||||
| Electrical Services [2.1%] | ||||||||
| Ameren | 208 | 7 | ||||||
| American Electric Power | 415 | 18 | ||||||
| AMETEK | 5,185 | 184 | ||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 68
| schedule of investments |
September 30, 2012 |
Diversified Equity Fund (continued) |
Description | Shares | Value (000) |
| CenterPoint Energy | 365 | $ | 8 | |||||
| CMS Energy | 226 | 5 | ||||||
| Consolidated Edison | 250 | 15 | ||||||
| Cooper Industries | 136 | 10 | ||||||
| DTE Energy | 147 | 9 | ||||||
| Duke Energy | 602 | 39 | ||||||
| Exelon | 730 | 26 | ||||||
| First Solar * | 51 | 1 | ||||||
| FirstEnergy | 358 | 16 | ||||||
| Integrys Energy Group | 67 | 4 | ||||||
| NextEra Energy | 362 | 25 | ||||||
| NiSource | 244 | 6 | ||||||
| Northeast Utilities | 10,768 | 412 | ||||||
| Pepco Holdings | 196 | 4 | ||||||
| Pinnacle West Capital | 94 | 5 | ||||||
| PPL | 496 | 14 | ||||||
| Public Service Enterprise Group | 432 | 14 | ||||||
| Rockwell Automation | 121 | 9 | ||||||
| Roper Industries | 83 | 9 | ||||||
| SCANA | 112 | 5 | ||||||
| Southern | 748 | 34 | ||||||
| TECO Energy | 174 | 3 | ||||||
| Wisconsin Energy | 197 | 7 | ||||||
| Xcel Energy | 416 | 12 | ||||||
Total Electrical Services | 901 | |||||||
| Electronic Equipment & Instruments [1.3%] | ||||||||
| Amphenol, Cl A | 137 | 8 | ||||||
| Avnet * | 19,000 | 553 | ||||||
| FLIR Systems | 129 | 3 | ||||||
| Jabil Circuit | 160 | 3 | ||||||
| Molex | 118 | 3 | ||||||
| TE Connectivity | 365 | 12 | ||||||
Total Electronic Equipment & Instruments | 582 | |||||||
| Energy [0.2%] | ||||||||
| Dominion Resources | 491 | 26 | ||||||
| Edison International | 278 | 13 | ||||||
| Entergy | 151 | 10 | ||||||
| PG&E | 365 | 16 | ||||||
| Sempra Energy | 192 | 12 | ||||||
Total Energy | 77 | |||||||
| Engineering Services [0.0%] | ||||||||
Fluor | 143 | 8 | ||||||
Description | Shares | Value (000) |
| Entertainment [2.3%] | ||||||||
| Carnival | 382 | $ | 14 | |||||
| Chipotle Mexican Grill, Cl A * | 217 | 69 | ||||||
| Darden Restaurants | 109 | 6 | ||||||
| International Game Technology | 228 | 3 | ||||||
| Las Vegas Sands | 3,960 | 184 | ||||||
| Marriott International, Cl A | 215 | 8 | ||||||
| Starbucks | 5,040 | 256 | ||||||
| Starwood Hotels & Resorts Worldwide | 3,468 | 201 | ||||||
| Wendy's | 46,300 | 211 | ||||||
| Wyndham Worldwide | 122 | 6 | ||||||
| Wynn Resorts | 68 | 8 | ||||||
Total Entertainment | 966 | |||||||
| Financial Services [2.3%] | ||||||||
| American Express | 9,013 | 513 | ||||||
| Capital One Financial | 7,297 | 416 | ||||||
| Charles Schwab | 937 | 12 | ||||||
| CME Group, Cl A | 262 | 15 | ||||||
| Discover Financial Services | 441 | 18 | ||||||
| Hudson City Bancorp | 406 | 3 | ||||||
| IntercontinentalExchange * | 62 | 8 | ||||||
| Nasdaq Stock Market | 101 | 2 | ||||||
| NYSE Euronext | 211 | 5 | ||||||
| People's United Financial | 301 | 4 | ||||||
| SLM | 402 | 6 | ||||||
| Western Union | 515 | 9 | ||||||
Total Financial Services | 1,011 | |||||||
| Food, Beverage & Tobacco [3.3%] | ||||||||
| Beam | 135 | 8 | ||||||
| Brown-Forman, Cl B | 130 | 8 | ||||||
| Coca-Cola | 15,471 | 587 | ||||||
| Coca-Cola Enterprises | 237 | 7 | ||||||
| ConAgra Foods | 347 | 10 | ||||||
| Constellation Brands, Cl A * | 126 | 4 | ||||||
| Dr Pepper Snapple Group | 180 | 8 | ||||||
| General Mills | 555 | 22 | ||||||
| Kellogg Company | 211 | 11 | ||||||
| Kraft Foods, Cl A | 1,518 | 63 | ||||||
| Molson Coors Brewing, Cl B | 133 | 6 | ||||||
| Monster Beverage * | 131 | 7 | ||||||
| PepsiCo | 9,540 | 675 | ||||||
| Safeway | 205 | 3 | ||||||
Total Food, Beverage & Tobacco | 1,419 | |||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 69
| schedule of investments |
September 30, 2012 |
Diversified Equity Fund (continued) |
Description | Shares | Value (000) |
| Gas/Natural Gas [0.0%] | ||||||||
| AGL Resources | 100 | $ | 4 | |||||
| ONEOK | 175 | 9 | ||||||
Total Gas/Natural Gas | 13 | |||||||
| Healthcare Technology [0.4%] | ||||||||
Cerner * | 2,584 | 200 | ||||||
| Healthcare Products & Services [1.8%] | ||||||||
| Agilent Technologies | 4,208 | 162 | ||||||
| Cardinal Health | 291 | 11 | ||||||
| Humana | 138 | 10 | ||||||
| Life Technologies * | 150 | 7 | ||||||
| McKesson | 5,664 | 487 | ||||||
| Medtronic | 872 | 38 | ||||||
| PerkinElmer | 97 | 3 | ||||||
| Thermo Fisher Scientific | 313 | 18 | ||||||
| UnitedHealth Group | 883 | 49 | ||||||
| Waters * | 75 | 6 | ||||||
Total Healthcare Products & Services | 791 | |||||||
| Household Furniture & Fixtures [0.4%] | ||||||||
| Harman International Industries | 58 | 3 | ||||||
| Lennar, Cl A | 3,559 | 124 | ||||||
| Newell Rubbermaid | 247 | 5 | ||||||
| PulteGroup * | 288 | 4 | ||||||
| Stanley Black & Decker | 144 | 11 | ||||||
| Whirlpool | 66 | 5 | ||||||
Total Household Furniture & Fixtures | 152 | |||||||
| Independent Power Producers & Energy Trader [0.0%] | ||||||||
| AES | 531 | 6 | ||||||
| NRG Energy | 195 | 4 | ||||||
Total Independent Power Producers & Energy Trader | 10 | |||||||
| Industrial [0.0%] | ||||||||
| Dun & Bradstreet | 38 | 3 | ||||||
| Equifax | 102 | 5 | ||||||
| Robert Half International | 122 | 3 | ||||||
Total Industrial | 11 | |||||||
| Insurance [6.3%] | ||||||||
| ACE | 290 | 22 | ||||||
| Aetna | 286 | 11 | ||||||
| Aflac | 401 | 19 | ||||||
Description | Shares | Value (000) |
| Allstate | 415 | $ | 16 | |||||
| American International Group * | 12,697 | 416 | ||||||
| Aon | 276 | 14 | ||||||
| Assurant | 70 | 3 | ||||||
| Berkshire Hathaway, Cl B * | 7,990 | 705 | ||||||
| Chubb | 227 | 17 | ||||||
| Cigna | 247 | 12 | ||||||
| Cincinnati Financial | 125 | 5 | ||||||
| Coventry Health Care | 114 | 5 | ||||||
| DaVita * | 72 | 8 | ||||||
| Express Scripts Holding * | 693 | 43 | ||||||
| Genworth Financial, Cl A * | 420 | 2 | ||||||
| Hartford Financial Services Group | 373 | 7 | ||||||
| HCC Insurance Holdings | 17,000 | 576 | ||||||
| Lincoln National | 238 | 6 | ||||||
| Loews | 4,967 | 205 | ||||||
| Marsh & McLennan | 466 | 16 | ||||||
| MetLife | 15,108 | 521 | ||||||
| Principal Financial Group | 237 | 6 | ||||||
| Progressive | 480 | 10 | ||||||
| Prudential Financial | 399 | 22 | ||||||
| Tenet Healthcare * | 356 | 2 | ||||||
| Torchmark | 82 | 4 | ||||||
| Travelers | 329 | 23 | ||||||
| Unum Group | 239 | 5 | ||||||
| XL Group, Cl A | 262 | 6 | ||||||
Total Insurance | 2,707 | |||||||
| Internet & Catalog Retail [0.1%] | ||||||||
| Expedia | 80 | 5 | ||||||
| Netflix * | 47 | 2 | ||||||
| priceline.com * | 43 | 27 | ||||||
| TripAdvisor * | 94 | 3 | ||||||
Total Internet & Catalog Retail | 37 | |||||||
| Investment Banker/Broker Dealer [1.1%] | ||||||||
| Affiliated Managers Group * | 1,650 | 203 | ||||||
| Ameriprise Financial | 180 | 10 | ||||||
| BlackRock, Cl A | 109 | 19 | ||||||
| E*Trade Financial * | 220 | 2 | ||||||
| Federated Investors, Cl B | 80 | 2 | ||||||
| Franklin Resources | 118 | 15 | ||||||
| Goldman Sachs Group | 385 | 44 | ||||||
| Invesco | 380 | 9 | ||||||
| JPMorgan Chase | 3,248 | 131 | ||||||
| Legg Mason | 103 | 3 | ||||||
| Morgan Stanley | 1,183 | 20 | ||||||
| Northern Trust | 187 | 9 | ||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 70
| schedule of investments |
September 30, 2012 |
Diversified Equity Fund (continued) |
Description | Shares | Value (000) |
| T Rowe Price Group | 217 | $ | 14 | |||||
Total Investment Banker/Broker Dealer | 481 | |||||||
| Machinery [2.3%] | ||||||||
| AGCO * | 4,600 | 218 | ||||||
| Caterpillar | 3,318 | 285 | ||||||
| Cummins | 1,491 | 138 | ||||||
| Deere | 1,715 | 141 | ||||||
| Dover | 157 | 9 | ||||||
| Eaton | 288 | 14 | ||||||
| Flowserve | 44 | 6 | ||||||
| Illinois Tool Works | 369 | 22 | ||||||
| Ingersoll-Rand | 245 | 11 | ||||||
| Joy Global | 91 | 5 | ||||||
| Pall | 99 | 6 | ||||||
| Snap-on | 50 | 4 | ||||||
| SPX | 2,110 | 138 | ||||||
| Xylem | 159 | 4 | ||||||
Total Machinery | 1,001 | |||||||
| Manufacturing [1.6%] | ||||||||
Tyco International | 12,543 | 706 | ||||||
| Medical Products & Services [6.4%] | ||||||||
| Bard (C.R.) | 67 | 7 | ||||||
| Baxter International | 5,268 | 317 | ||||||
| Becton Dickinson | 171 | 13 | ||||||
| Boston Scientific * | 1,213 | 7 | ||||||
| CareFusion * | 21,532 | 611 | ||||||
| Covidien | 9,961 | 592 | ||||||
| DENTSPLY International | 122 | 5 | ||||||
| Edwards Lifesciences * | 99 | 11 | ||||||
| Hospira * | 141 | 5 | ||||||
| Intuitive Surgical * | 384 | 190 | ||||||
| Laboratory Corp of America Holdings * | 6,282 | 581 | ||||||
| Patterson | 11,072 | 379 | ||||||
| Quest Diagnostics | 135 | 9 | ||||||
| St. Jude Medical | 268 | 11 | ||||||
| Stryker | 248 | 14 | ||||||
| Varian Medical Systems * | 95 | 6 | ||||||
| WellPoint | 278 | 16 | ||||||
| Zimmer Holdings | 149 | 10 | ||||||
Total Medical Products & Services | 2,784 | |||||||
| Miscellaneous Manufacturing [0.0%] | ||||||||
Leggett & Platt | 121 | 3 | ||||||
Description | Shares | Value (000) |
| Multi-Media [0.2%] | ||||||||
Walt Disney | 1,534 | $ | 80 | |||||
| Office Equipment & Supplies [0.0%] | ||||||||
Avery Dennison | 87 | 3 | ||||||
| Office Furniture & Fixtures [1.6%] | ||||||||
| Autodesk * | 194 | 7 | ||||||
| BMC Software * | 125 | 5 | ||||||
| Citrix Systems * | 160 | 12 | ||||||
| Electronic Arts * | 272 | 3 | ||||||
| Fortinet * | 2,810 | 68 | ||||||
| Intuit | 236 | 14 | ||||||
| Red Hat * | 165 | 9 | ||||||
| Salesforce.com * | 1,059 | 162 | ||||||
| Splunk * | 2,100 | 77 | ||||||
| TIBCO Software * | 4,690 | 142 | ||||||
| VMware, Cl A * | 2,170 | 210 | ||||||
Total Office Furniture & Fixtures | 709 | |||||||
| Paper & Related Products [0.5%] | ||||||||
| International Paper | 374 | 14 | ||||||
| MeadWestvaco | 148 | 5 | ||||||
| Packaging Corp of America | 5,600 | 203 | ||||||
| Sealed Air | 149 | 2 | ||||||
Total Paper & Related Products | 224 | |||||||
| Personal Products [0.0%] | ||||||||
Avon Products | 369 | 6 | ||||||
| Petroleum & Fuel Products [8.9%] | ||||||||
| Alpha Natural Resources * | 188 | 1 | ||||||
| Anadarko Petroleum | 1,718 | 120 | ||||||
| Apache | 335 | 29 | ||||||
| Baker Hughes | 376 | 17 | ||||||
| Cabot Oil & Gas | 2,170 | 97 | ||||||
| Cameron International * | 211 | 12 | ||||||
| Chesapeake Energy | 443 | 8 | ||||||
| Chevron | 1,678 | 196 | ||||||
| Concho Resources * | 1,750 | 166 | ||||||
| ConocoPhillips | 4,439 | 254 | ||||||
| Consol Energy | 195 | 6 | ||||||
| Denbury Resources * | 335 | 5 | ||||||
| Devon Energy | 322 | 19 | ||||||
| Diamond Offshore Drilling | 59 | 4 | ||||||
| Enbridge | 3,050 | 119 | ||||||
| Ensco, Cl A | 199 | 11 | ||||||
| EOG Resources | 231 | 26 | ||||||
| EQT | 128 | 8 | ||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 71
| schedule of investments |
September 30, 2012 |
Diversified Equity Fund (continued) |
Description | Shares | Value (000) |
| Exxon Mobil | 3,947 | $ | 361 | |||||
| FMC Technologies * | 204 | 9 | ||||||
| Halliburton | 793 | 27 | ||||||
| Helmerich & Payne | 90 | 4 | ||||||
| Hess | 254 | 14 | ||||||
| Kinder Morgan | 488 | 17 | ||||||
| Marathon Oil | 603 | 18 | ||||||
| Marathon Petroleum | 289 | 16 | ||||||
| Murphy Oil | 158 | 8 | ||||||
| Nabors Industries * | 249 | 3 | ||||||
| National Oilwell Varco | 365 | 29 | ||||||
| Newfield Exploration * | 115 | 4 | ||||||
| Noble | 13,416 | 480 | ||||||
| Noble Energy | 152 | 14 | ||||||
| Occidental Petroleum | 693 | 60 | ||||||
| Peabody Energy | 229 | 5 | ||||||
| Phillips 66 | 5,186 | 240 | ||||||
| Pioneer Natural Resources | 105 | 11 | ||||||
| QEP Resources | 152 | 5 | ||||||
| Range Resources | 139 | 10 | ||||||
| Rowan, Cl A * | 106 | 4 | ||||||
| Schlumberger | 5,054 | 366 | ||||||
| Southwestern Energy * | 11,198 | 389 | ||||||
| Spectra Energy | 13,758 | 404 | ||||||
| Sunoco | 90 | 4 | ||||||
| Tesoro | 120 | 5 | ||||||
| Valero Energy | 471 | 15 | ||||||
| Whiting Petroleum * | 4,500 | 213 | ||||||
| Williams | 535 | 19 | ||||||
| WPX Energy * | 170 | 3 | ||||||
Total Petroleum & Fuel Products | 3,855 | |||||||
| Printing & Publishing [0.1%] | ||||||||
| Cintas | 92 | 4 | ||||||
| Gannett | 198 | 4 | ||||||
| Iron Mountain | 129 | 4 | ||||||
| Pitney Bowes | 172 | 2 | ||||||
| Republic Services, Cl A | 256 | 7 | ||||||
| RR Donnelley & Sons | 154 | 2 | ||||||
| Stericycle * | 73 | 7 | ||||||
Total Printing & Publishing | 30 | |||||||
| Railroads [0.1%] | ||||||||
CSX | 890 | 18 | ||||||
| Real Estate Investment Trust [0.9%] | ||||||||
| American Tower, Cl A | 338 | 24 | ||||||
| Apartment Investment & Management, Cl A | 124 | 3 | ||||||
Description | Shares | Value (000) |
| AvalonBay Communities | 83 | $ | 11 | |||||
| Boston Properties | 129 | 14 | ||||||
| Equity Residential | 257 | 15 | ||||||
| HCP | 367 | 16 | ||||||
| Health Care | 218 | 13 | ||||||
| Host Hotels & Resorts | 618 | 10 | ||||||
| Kimco Realty | 348 | 7 | ||||||
| Plum Creek Timber | 138 | 6 | ||||||
| ProLogis | 394 | 14 | ||||||
| Public Storage | 123 | 17 | ||||||
| Simon Property Group | 1,240 | 188 | ||||||
| Ventas | 252 | 16 | ||||||
| Vornado Realty Trust | 145 | 12 | ||||||
| Weyerhaeuser | 460 | 12 | ||||||
Total Real Estate Investment Trust | 378 | |||||||
| Real Estate Management & Development [1.9%] | ||||||||
| Brookfield Asset Management, Cl A | 19,400 | 669 | ||||||
| CBRE Group, Cl A * | 8,938 | 165 | ||||||
Total Real Estate Management & Development | 834 | |||||||
| Retail [3.7%] | ||||||||
| Abercrombie & Fitch, Cl A | 70 | 2 | ||||||
| AutoNation * | 33 | 1 | ||||||
| Bed Bath & Beyond * | 199 | 13 | ||||||
| Best Buy | 227 | 4 | ||||||
| Big Lots * | 51 | 2 | ||||||
| CarMax * | 195 | 6 | ||||||
| Costco Wholesale | 370 | 37 | ||||||
| CVS | 1,088 | 52 | ||||||
| Dollar Tree * | 197 | 10 | ||||||
| Family Dollar Stores | 83 | 5 | ||||||
| Gap | 255 | 9 | ||||||
| GNC Holdings, Cl A | 3,320 | 129 | ||||||
| Home Depot | 5,609 | 339 | ||||||
| JC Penney | 10,522 | 256 | ||||||
| Kohl's | 185 | 9 | ||||||
| Kroger | 466 | 11 | ||||||
| Limited Brands | 204 | 10 | ||||||
| Lowe's | 975 | 29 | ||||||
| Macy's | 344 | 13 | ||||||
| McDonald's | 863 | 79 | ||||||
| Nordstrom | 131 | 7 | ||||||
| O'Reilly Automotive * | 102 | 9 | ||||||
| Ross Stores | 191 | 12 | ||||||
| Sherwin-Williams | 73 | 11 | ||||||
| Staples | 583 | 7 | ||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 72
| schedule of investments |
September 30, 2012 |
Diversified Equity Fund (continued) |
Description | Shares | Value (000) |
| SYSCO | 502 | $ | 16 | |||||
| Target | 560 | 36 | ||||||
| Tiffany | 102 | 6 | ||||||
| TJX | 630 | 28 | ||||||
| Urban Outfitters * | 94 | 4 | ||||||
| Walgreen | 733 | 27 | ||||||
| Wal-Mart Stores | 1,437 | 106 | ||||||
| Whole Foods Market | 1,727 | 168 | ||||||
| Yum! Brands | 1,680 | 111 | ||||||
Total Retail | 1,564 | |||||||
| Schools [0.0%] | ||||||||
Apollo Group, Cl A * | 86 | 2 | ||||||
| Semi-Conductors [2.3%] | ||||||||
| Advanced Micro Devices * | 514 | 2 | ||||||
| Altera | 7,414 | 252 | ||||||
| Analog Devices | 256 | 10 | ||||||
| Applied Materials | 1,058 | 12 | ||||||
| ASML Holding, Cl G | 2,670 | 143 | ||||||
| Broadcom, Cl A | 6,970 | 241 | ||||||
| Intel | 4,278 | 97 | ||||||
| KLA-Tencor | 142 | 7 | ||||||
| Lam Research * | 156 | 5 | ||||||
| Linear Technology | 197 | 6 | ||||||
| LSI * | 477 | 3 | ||||||
| Microchip Technology | 166 | 5 | ||||||
| Micron Technology * | 870 | 5 | ||||||
| NVIDIA * | 530 | 7 | ||||||
| NXP Semiconductor * | 6,900 | 173 | ||||||
| Teradyne * | 160 | 2 | ||||||
| Texas Instruments | 973 | 27 | ||||||
| Xilinx | 224 | 8 | ||||||
Total Semi-Conductors | 1,005 | |||||||
| Steel & Steel Works [0.1%] | ||||||||
Nucor | 272 | 10 | ||||||
| Telephones & Telecommunications [3.6%] | ||||||||
| AT&T | 14,933 | 563 | ||||||
| CenturyLink | 532 | 22 | ||||||
| Corning | 31,374 | 413 | ||||||
| Crown Castle International * | 250 | 16 | ||||||
| Frontier Communications | 853 | 4 | ||||||
| MetroPCS Communications * | 270 | 3 | ||||||
| Sprint Nextel * | 2,566 | 14 | ||||||
| Verizon Communications | 2,436 | 111 | ||||||
| Vodafone Group ADR | 13,400 | 382 | ||||||
Description | Shares | Value (000) |
| Windstream | 503 | $ | 5 | |||||
Total Telephones & Telecommunications | 1,533 | |||||||
| Trading Companies & Distributors [0.1%] | ||||||||
| Fastenal | 230 | 10 | ||||||
| WW Grainger | 51 | 10 | ||||||
Total Trading Companies & Distributors | 20 | |||||||
| Transportation Services [0.3%] | ||||||||
| CH Robinson Worldwide | 138 | 8 | ||||||
| Expeditors International of Washington | 180 | 7 | ||||||
| FedEx | 250 | 21 | ||||||
| Norfolk Southern | 274 | 17 | ||||||
| Union Pacific | 405 | 48 | ||||||
| United Parcel Service, Cl B | 615 | 44 | ||||||
Total Transportation Services | 145 | |||||||
| Trucking [0.0%] | ||||||||
Ryder System | 44 | 2 | ||||||
| Waste Management Services [0.0%] | ||||||||
Waste Management | 373 | 12 | ||||||
| Web Portals/ISP [3.2%] | ||||||||
| Akamai Technologies * | 151 | 6 | ||||||
| Amazon.com * | 1,329 | 339 | ||||||
| Facebook, Cl A * | 6,920 | 150 | ||||||
| Google, Cl A * | 833 | 628 | ||||||
| Juniper Networks * | 7,850 | 134 | ||||||
| LinkedIn, Cl A * | 740 | 89 | ||||||
| VeriSign * | 134 | 7 | ||||||
| Yahoo! * | 891 | 14 | ||||||
Total Web Portals/ISP | 1,367 | |||||||
| Wholesale [0.4%] | ||||||||
| Archer-Daniels-Midland | 563 | 15 | ||||||
| Campbell Soup | 154 | 5 | ||||||
| Dean Foods * | 158 | 3 | ||||||
| Hershey | 130 | 9 | ||||||
| HJ Heinz | 274 | 15 | ||||||
| Hormel Foods | 115 | 4 | ||||||
| JM Smucker | 94 | 8 | ||||||
| McCormick | 113 | 7 | ||||||
| Mead Johnson Nutrition, Cl A | 1,634 | 120 | ||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 73
| schedule of investments |
September 30, 2012 |
Diversified Equity Fund (concluded) |
Description | Shares | Value (000) |
| Tyson Foods, Cl A | 248 | $ | 4 | |||||
Total Wholesale | 190 | |||||||
Total Common Stock (Cost $37,705) | 42,290 | |||||||
| Short-Term Investments [10.0%] | ||||||||
CNI Government Money Market Fund, Cl I, 0.010% **† | 2,152,391 | 2,152 | ||||||
| SEI Daily Income Trust Government Fund, Cl A, 0.020% ** | 2,152,391 | 2,152 | ||||||
Total Short-Term Investments (Cost $4,305) | 4,304 | |||||||
Total Investments [107.8%] (Cost $42,010) | $ | 46,594 | ||||||
Percentages are based on Net Assets of $43,236 ($ Thousands).
| * | Non-income producing security. |
| ** | The rate reported is the 7-day effective yield as of September 30, 2012. |
| † | Investment in Affiliate. |
ADR — American Depositary Receipt
Cl — Class
As of September 30, 2012, all of the Fund’s investments are Level 1.
For the year ended September 30, 2012, there have been no transfers between Level 1 and Level 2 assets and liabilities. Transfers between Levels are recognized at period end.
For more information on valuation inputs, see Note 2 — Significant Accounting Policies in the Notes to Financial Statements.
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 74
| schedule of investments |
September 30, 2012 |
Large Cap Value Equity Fund |
Description | Shares | Value (000) |
| Common Stock [93.4%] | ||||||||
| Aerospace & Defense [0.9%] | ||||||||
| Engility Holdings * | 2,600 | $ | 48 | |||||
| L-3 Communications Holdings, Cl 3 | 15,600 | 1,119 | ||||||
Total Aerospace & Defense | 1,167 | |||||||
| Auto Components [1.5%] | ||||||||
Magna International | 42,300 | 1,830 | ||||||
| Beverages [0.6%] | ||||||||
PepsiCo | 10,200 | 722 | ||||||
| Capital Markets [3.7%] | ||||||||
| Bank of New York Mellon | 52,900 | 1,197 | ||||||
| Goldman Sachs Group | 16,531 | 1,879 | ||||||
| State Street | 34,800 | 1,460 | ||||||
Total Capital Markets | 4,536 | |||||||
| Commercial Banks [4.8%] | ||||||||
| US Bancorp | 74,500 | 2,555 | ||||||
| Wells Fargo | 98,960 | 3,417 | ||||||
Total Commercial Banks | 5,972 | |||||||
| Commercial Services & Supplies [2.5%] | ||||||||
| Iron Mountain | 64,000 | 2,183 | ||||||
| Waste Management | 30,500 | 979 | ||||||
Total Commercial Services & Supplies | 3,162 | |||||||
Description | Shares | Value (000) |
| Communications Equipment [2.2%] | ||||||||
Cisco Systems | 146,000 | $ | 2,787 | |||||
| Consumer Finance [1.8%] | ||||||||
American Express | 40,200 | 2,286 | ||||||
| Diversified Financial Services [5.0%] | ||||||||
| Citigroup | 88,397 | 2,892 | ||||||
| JPMorgan Chase | 83,200 | 3,368 | ||||||
Total Diversified Financial Services | 6,260 | |||||||
| Diversified Telecommunication Services [3.5%] | ||||||||
| AT&T | 79,917 | 3,013 | ||||||
| Verizon Communications | 30,500 | 1,390 | ||||||
Total Diversified Telecommunication Services | 4,403 | |||||||
| Electric Utilities [2.7%] | ||||||||
| American Electric Power | 23,800 | 1,046 | ||||||
| Edison International | 35,500 | 1,622 | ||||||
| NextEra Energy | 10,200 | 717 | ||||||
Total Electric Utilities | 3,385 | |||||||
| Electronic Equipment [1.9%] | ||||||||
Corning | 177,200 | 2,330 | ||||||
| Food & Staples Retailing [4.2%] | ||||||||
| Walgreen | 52,000 | 1,895 | ||||||
| Wal-Mart Stores | 45,000 | 3,321 | ||||||
Total Food & Staples Retailing | 5,216 | |||||||
| Gas Utilities [0.6%] | ||||||||
Southwest Gas | 15,500 | 685 | ||||||
| Healthcare Equipment & Supplies [0.5%] | ||||||||
Becton Dickinson | 6,900 | 542 | ||||||
| Healthcare Providers & Services [1.8%] | ||||||||
| Aetna | 34,200 | 1,354 | ||||||
| Cigna | 18,500 | 873 | ||||||
Total Healthcare Providers & Services | 2,227 | |||||||
| Household Products [1.9%] | ||||||||
Procter & Gamble | 34,700 | 2,406 | ||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 75
| schedule of investments |
September 30, 2012 |
Large Cap Value Equity Fund (continued) |
Description | Shares | Value (000) |
| Industrial Conglomerates [2.6%] | ||||||||
General Electric | 143,200 | $ | 3,252 | |||||
| Insurance [8.2%] | ||||||||
| Aflac | 58,362 | 2,795 | ||||||
| Berkshire Hathaway, Cl B * | 35,400 | 3,122 | ||||||
| Marsh & McLennan | 63,100 | 2,141 | ||||||
| Travelers | 31,700 | 2,164 | ||||||
Total Insurance | 10,222 | |||||||
| IT Services [1.5%] | ||||||||
Western Union | 100,000 | 1,822 | ||||||
| Machinery [1.6%] | ||||||||
AGCO * | 40,700 | 1,932 | ||||||
| Media [3.8%] | ||||||||
| Cablevision Systems, Cl A | 161,000 | 2,552 | ||||||
| Comcast, Cl A | 61,100 | 2,185 | ||||||
Total Media | 4,737 | |||||||
| Metals & Mining [3.1%] | ||||||||
| Barrick Gold | 45,400 | 1,896 | ||||||
| Newmont Mining | 34,400 | 1,927 | ||||||
Total Metals & Mining | 3,823 | |||||||
| Multiline Retail [4.1%] | ||||||||
| Big Lots * | 66,300 | 1,961 | ||||||
| JC Penney | 55,300 | 1,343 | ||||||
| Target | 28,200 | 1,790 | ||||||
Total Multiline Retail | 5,094 | |||||||
| Multi-Utilities [3.2%] | ||||||||
| National Grid PLC ADR | 27,200 | 1,506 | ||||||
| PG&E | 42,000 | 1,792 | ||||||
| Public Service Enterprise Group | 22,100 | 711 | ||||||
Total Multi-Utilities | 4,009 | |||||||
| Oil, Gas & Consumable Fuels [11.1%] | ||||||||
| BP ADR | 40,900 | 1,732 | ||||||
| Chesapeake Energy | 101,300 | 1,912 | ||||||
| Chevron | 25,440 | 2,965 | ||||||
| ConocoPhillips | 46,680 | 2,669 | ||||||
| Exxon Mobil | 33,500 | 3,064 | ||||||
Description | Shares | Value (000) |
| Hess | 26,000 | $ | 1,397 | |||||
Total Oil, Gas & Consumable Fuels | 13,739 | |||||||
| Pharmaceuticals [4.7%] | ||||||||
| Abbott Laboratories | 21,700 | 1,488 | ||||||
| Eli Lilly | 35,600 | 1,688 | ||||||
| Merck | 32,200 | 1,452 | ||||||
| Teva Pharmaceutical Industries ADR | 29,900 | 1,238 | ||||||
Total Pharmaceuticals | 5,866 | |||||||
| Real Estate Management & Development [1.9%] | ||||||||
Brookfield Asset Management, Cl A | 68,200 | 2,354 | ||||||
| Road & Rail [1.7%] | ||||||||
Union Pacific | 17,800 | 2,113 | ||||||
| Semiconductors & Semiconductor Equipment [1.3%] | ||||||||
Intel | 72,200 | 1,638 | ||||||
| Software [2.7%] | ||||||||
Microsoft | 114,600 | 3,412 | ||||||
| Specialty Retail [0.7%] | ||||||||
Staples | 82,700 | 953 | ||||||
| Trading Companies & Distributors [1.1%] | ||||||||
United Rentals * | 40,000 | 1,308 | ||||||
Total Common Stock (Cost $105,121) | 116,190 | |||||||
| Short-Term Investments [6.7%] | ||||||||
CNI Prime Money Market Fund, Cl I, 0.030% **† | 4,191,720 | 4,192 | ||||||
| SEI Daily Income Trust, Prime Obligation Fund, Cl A, 0.070% ** | 4,191,720 | 4,192 | ||||||
Total Short-Term Investments (Cost $8,383) | 8,384 | |||||||
Total Investments [100.1%] (Cost $113,504) | $ | 124,574 | ||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 76
| schedule of investments |
September 30, 2012 |
Large Cap Value Equity Fund (concluded) |
Percentages are based on Net Assets of $124,400 ($ Thousands).
| * | Non-income producing security. |
| ** | The rate reported is the 7-day effective yield as of September 30, 2012. |
| † | Investment in Affiliate. |
ADR — American Depositary Receipt
Cl — Class
PLC — Public Limited Company
As of September 30, 2012, all of the Fund’s investments are Level 1.
For the year ended September 30, 2012, there have been no transfers between Level 1 and Level 2 assets and liabilities. Transfers between Levels are recognized at period end.
For more information on valuation inputs, see Note 2 — Significant Accounting Policies in the Notes to Financial Statements.
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 77
| schedule of investments |
September 30, 2012 |
Large Cap Growth Equity Fund |
Description | Shares | Value (000) |
| Common Stock [98.1%] | ||||||||
| Aerospace & Defense [2.6%] | ||||||||
| Boeing | 8,500 | $ | 592 | |||||
| Textron | 26,400 | 691 | ||||||
Total Aerospace & Defense | 1,283 | |||||||
| Air Freight & Logistics [1.4%] | ||||||||
FedEx | 8,400 | 711 | ||||||
| Beverages [2.5%] | ||||||||
| Dr Pepper Snapple Group | 13,800 | 615 | ||||||
| Fomento Economico Mexicano ADR | 6,800 | 625 | ||||||
Total Beverages | 1,240 | |||||||
| Biotechnology [7.4%] | ||||||||
| Celgene * | 15,600 | 1,192 | ||||||
| Gilead Sciences * | 25,300 | 1,678 | ||||||
| Onyx Pharmaceuticals * | 9,400 | 794 | ||||||
Total Biotechnology | 3,664 | |||||||
| Chemicals [1.4%] | ||||||||
Mosaic | 12,100 | 697 | ||||||
| Commercial Banks [1.2%] | ||||||||
Wells Fargo | 17,650 | 609 | ||||||
| Communications Equipment [3.4%] | ||||||||
Qualcomm | 26,600 | 1,662 | ||||||
Description | Shares | Value (000) |
| Computers & Peripherals [13.8%] | ||||||||
| Apple | 8,300 | $ | 5,538 | |||||
| EMC * | 46,600 | 1,271 | ||||||
Total Computers & Peripherals | 6,809 | |||||||
| Diversified Telecommunication Services [0.9%] | ||||||||
Verizon Communications | 9,500 | 433 | ||||||
| Energy Equipment & Services [5.5%] | ||||||||
| Baker Hughes | 16,300 | 737 | ||||||
| Halliburton | 14,100 | 475 | ||||||
| National Oilwell Varco | 8,300 | 665 | ||||||
| Schlumberger | 11,600 | 839 | ||||||
Total Energy Equipment & Services | 2,716 | |||||||
| Food & Staples Retailing [5.0%] | ||||||||
| CVS | 28,000 | 1,356 | ||||||
| Wal-Mart Stores | 14,800 | 1,092 | ||||||
Total Food & Staples Retailing | 2,448 | |||||||
| Food Products [4.2%] | ||||||||
| Bunge | 14,300 | 959 | ||||||
| Dean Foods * | 68,700 | 1,123 | ||||||
Total Food Products | 2,082 | |||||||
| Healthcare Equipment & Supplies [2.1%] | ||||||||
Baxter International | 17,000 | 1,025 | ||||||
| Healthcare Providers & Services [1.7%] | ||||||||
UnitedHealth Group | 14,900 | 826 | ||||||
| Hotels, Restaurants & Leisure [1.4%] | ||||||||
Starbucks | 13,500 | 685 | ||||||
| Household Products [1.5%] | ||||||||
Energizer Holdings | 10,000 | 746 | ||||||
| Independent Power Producers & Energy Traders [0.8%] | ||||||||
AES | 37,400 | 410 | ||||||
| Industrial Conglomerates [1.9%] | ||||||||
Danaher | 16,700 | 921 | ||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 78
| schedule of investments |
September 30, 2012 |
Large Cap Growth Equity Fund (concluded) |
Description | Shares | Value (000) |
| Insurance [1.9%] | ||||||||
Prudential Financial | 16,800 | $ | 916 | |||||
| Internet & Catalog Retail [1.3%] | ||||||||
priceline.com * | 1,000 | 619 | ||||||
| Internet Software & Services [3.4%] | ||||||||
Google, Cl A * | 2,250 | 1,698 | ||||||
| IT Services [4.3%] | ||||||||
| IBM | 5,100 | 1,058 | ||||||
| Mastercard, Cl A | 2,300 | 1,038 | ||||||
Total IT Services | 2,096 | |||||||
| Life Sciences Tools & Services [1.4%] | ||||||||
Agilent Technologies | 18,000 | 692 | ||||||
| Machinery [1.6%] | ||||||||
Cummins | 8,500 | 784 | ||||||
| Media [5.8%] | ||||||||
| Comcast, Cl A | 27,100 | 969 | ||||||
| DIRECTV * | 24,600 | 1,291 | ||||||
| Omnicom Group | 12,100 | 624 | ||||||
Total Media | 2,884 | |||||||
| Metals & Mining [2.2%] | ||||||||
| Allegheny Technologies | 16,300 | 520 | ||||||
| Goldcorp | 12,700 | 582 | ||||||
Total Metals & Mining | 1,102 | |||||||
| Multiline Retail [1.7%] | ||||||||
Target | 13,000 | 825 | ||||||
| Oil, Gas & Consumable Fuels [5.7%] | ||||||||
| Chevron | 7,300 | 851 | ||||||
| Exxon Mobil | 21,200 | 1,939 | ||||||
Total Oil, Gas & Consumable Fuels | 2,790 | |||||||
| Pharmaceuticals [3.8%] | ||||||||
| Mylan * | 49,900 | 1,217 | ||||||
| Shire ADR | 7,800 | 692 | ||||||
Total Pharmaceuticals | 1,909 | |||||||
Description | Shares | Value (000) |
| Real Estate Management & Development [1.5%] | ||||||||
Jones Lang LaSalle | 9,500 | $ | 725 | |||||
| Road & Rail [1.4%] | ||||||||
Norfolk Southern | 10,900 | 693 | ||||||
| Software [3.4%] | ||||||||
| Microsoft | 35,200 | 1,049 | ||||||
| Nuance Communications * | 25,800 | 642 | ||||||
Total Software | 1,691 | |||||||
Total Common Stock (Cost $38,854) | 48,391 | |||||||
| Short-Term Investments [1.7%] | ||||||||
CNI Prime Money Market Fund, Cl I, 0.030% **† | 418,821 | 419 | ||||||
| SEI Daily Income Trust, Prime Obligation Fund, Cl A, 0.070% ** | 418,821 | 419 | ||||||
Total Short-Term Investments (Cost $838) | 838 | |||||||
Total Investments [99.8%] (Cost $39,692) | $ | 49,229 | ||||||
Percentages are based on Net Assets of $49,333 ($ Thousands).
| * | Non-income producing security. |
| ** | The rate reported is the 7-day effective yield as of September 30, 2012. |
| † | Investment in Affiliate. |
ADR — American Depositary Receipt
Cl — Class
As of September 30, 2012, all of the Fund’s investments are Level 1.
For the year ended September 30, 2012, there have been no transfers between Level 1 and Level 2 assets and liabilities. Transfers between Levels are recognized at period end.
For more information on valuation inputs, see Note 2 — Significant Accounting Policies in the Notes to Financial Statements.
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 79
| schedule of investments |
September 30, 2012 |
Socially Responsible Equity Fund |
Description | Shares | Value (000) |
| Common Stock [96.0%] | ||||||||
| Automotive [4.8%] | ||||||||
| Ford Motor | 154,200 | $ | 1,521 | |||||
| Johnson Controls | 58,700 | 1,608 | ||||||
| Paccar | 49,000 | 1,961 | ||||||
Total Automotive | 5,090 | |||||||
| Banks [7.8%] | ||||||||
| CIT Group * | 66,500 | 2,620 | ||||||
| Cullen | 21,400 | 1,229 | ||||||
| M&T Bank | 23,500 | 2,236 | ||||||
| US Bancorp | 64,000 | 2,195 | ||||||
Total Banks | 8,280 | |||||||
| Broadcasting & Cable [2.0%] | ||||||||
Cisco Systems | 109,800 | 2,096 | ||||||
| Building & Construction [1.8%] | ||||||||
Owens Corning * | 58,900 | 1,971 | ||||||
| Chemicals [2.7%] | ||||||||
EI du Pont de Nemours | 56,200 | 2,825 | ||||||
| Commercial Banks [1.9%] | ||||||||
BB&T | 62,000 | 2,056 | ||||||
| Communication & Media [1.0%] | ||||||||
Time Warner | 22,700 | 1,029 | ||||||
Description | Shares | Value (000) |
| Computer Software [0.9%] | ||||||||
Microsoft | 32,200 | $ | 959 | |||||
| Distributors [1.7%] | ||||||||
Genuine Parts | 30,200 | 1,843 | ||||||
| Drugs [3.0%] | ||||||||
Abbott Laboratories | 46,400 | 3,181 | ||||||
| Electrical Equipment [1.8%] | ||||||||
Emerson Electric | 39,200 | 1,892 | ||||||
| Electrical Services [1.8%] | ||||||||
Northeast Utilities | 49,600 | 1,896 | ||||||
| Electronic Equipment & Instruments [2.6%] | ||||||||
Arrow Electronics * | 80,300 | 2,707 | ||||||
| Financial Services [2.9%] | ||||||||
| American Express | 25,500 | 1,450 | ||||||
| CME Group, Cl A | 27,200 | 1,558 | ||||||
Total Financial Services | 3,008 | |||||||
| Food, Beverage & Tobacco [2.9%] | ||||||||
PepsiCo | 43,700 | 3,093 | ||||||
| Healthcare Products & Services [3.5%] | ||||||||
| Cardinal Health | 45,100 | 1,758 | ||||||
| McKesson | 23,200 | 1,996 | ||||||
Total Healthcare Products & Services | 3,754 | |||||||
| Household Furniture & Fixtures [1.6%] | ||||||||
Whirlpool | 20,000 | 1,658 | ||||||
| Insurance [10.6%] | ||||||||
| American International Group * | 61,000 | 2,000 | ||||||
| Berkshire Hathaway, Cl B * | 28,200 | 2,487 | ||||||
| Chubb | 40,500 | 3,090 | ||||||
| HCC Insurance Holdings | 62,500 | 2,118 | ||||||
| Loews | 36,600 | 1,510 | ||||||
Total Insurance | 11,205 | |||||||
| Machinery [2.0%] | ||||||||
Eaton | 44,000 | 2,079 | ||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 80
| schedule of investments |
September 30, 2012 |
Socially Responsible Equity Fund (concluded) |
Description | Shares | Value (000) |
| Manufacturing [2.0%] | ||||||||
Tyco International | 37,475 | $ | 2,108 | |||||
| Medical Products & Services [9.3%] | ||||||||
| Baxter International | 33,000 | 1,989 | ||||||
| CareFusion * | 74,500 | 2,115 | ||||||
| Laboratory Corp of America Holdings * | 33,300 | 3,079 | ||||||
| Patterson | 76,700 | 2,626 | ||||||
Total Medical Products & Services | 9,809 | |||||||
| Paper & Related Products [1.9%] | ||||||||
Packaging Corp of America | 55,800 | 2,026 | ||||||
| Petroleum & Fuel Products [10.5%] | ||||||||
| ConocoPhillips | 53,000 | 3,030 | ||||||
| Encana | 45,800 | 1,004 | ||||||
| Phillips 66 | 21,000 | 974 | ||||||
| Southwestern Energy * | 57,600 | 2,003 | ||||||
| Spectra Energy | 103,600 | 3,042 | ||||||
| Whiting Petroleum * | 21,000 | 995 | ||||||
Total Petroleum & Fuel Products | 11,048 | |||||||
| Property & Casualty Insurance [1.6%] | ||||||||
Fidelity National Financial, Cl A | 80,000 | 1,711 | ||||||
| Real Estate Management & Development [3.3%] | ||||||||
Brookfield Asset Management, Cl A | 101,000 | 3,486 | ||||||
| Retail [1.6%] | ||||||||
Home Depot | 28,000 | 1,691 | ||||||
| Semi-Conductors [3.9%] | ||||||||
| Analog Devices | 55,500 | 2,175 | ||||||
| Intel | 87,900 | 1,994 | ||||||
Total Semi-Conductors | 4,169 | |||||||
| Telephones & Telecommunications [3.6%] | ||||||||
| Corning | 141,400 | 1,859 | ||||||
| Vodafone Group ADR | 67,900 | 1,935 | ||||||
Total Telephones & Telecommunications | 3,794 | |||||||
Description | Shares | Value (000) |
| Transportation Services [1.0%] | ||||||||
United Parcel Service, Cl B | 14,300 | $ | 1,024 | |||||
Total Common Stock (Cost $88,870) | 101,488 | |||||||
| Short-Term Investment [4.5%] | ||||||||
| AIM STIT-Government TaxAdvantage Portfolio, 0.020% ** | 4,730,376 | 4,730 | ||||||
Total Short-Term Investment (Cost $4,730) | 4,730 | |||||||
Total Investments [100.5%] (Cost $93,600) | $ | 106,218 | ||||||
Percentages are based on Net Assets of $105,740 ($ Thousands).
| * | Non-income producing security. |
| ** | The rate reported is the 7-day effective yield as of September 30, 2012. |
ADR — American Depositary Receipt
Cl — Class
As of September 30, 2012, all of the Fund’s investments are Level 1.
For the year ended September 30, 2012, there have been no transfers between Level 1 and Level 2 assets and liabilities. Transfers between Levels are recognized at period end.
For more information on valuation inputs, see Note 2 — Significant Accounting Policies in the Notes to Financial Statements.
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 81
| statements of assets and liabilities (000) |
September 30, 2012 |
Government Money Market Fund | Prime Money Market Fund | California Tax Exempt Money Market Fund | ||||||||||
| ASSETS: | ||||||||||||
Cost of securities (including repurchase agreements) | $ | 3,192,673 | $ | 1,156,892 | $ | 864,072 | ||||||
| Investments in securities, at value | $ | 2,412,673 | $ | 1,011,892 | $ | 864,072 | ||||||
| Repurchase agreements, at value | 780,000 | 145,000 | — | |||||||||
| Cash | — | — | 39,709 | |||||||||
| Dividend and interest receivable | 1,537 | 335 | 577 | |||||||||
Prepaid expenses | 50 | 19 | 14 | |||||||||
Total Assets | 3,194,260 | 1,157,246 | 904,372 | |||||||||
| LIABILITIES: | ||||||||||||
| Payable for income distributions | 8 | 14 | 2 | |||||||||
| Investment adviser fees payable | 293 | 214 | 19 | |||||||||
| Shareholder servicing & distribution fees payable | — | 8 | — | |||||||||
| Administrative fees payable | 102 | 36 | 27 | |||||||||
| Trustees' fees payable | 3 | 1 | 1 | |||||||||
Accrued expenses | 412 | 149 | 156 | |||||||||
Total Liabilities | 818 | 422 | 205 | |||||||||
Net Assets | $ | 3,193,442 | $ | 1,156,824 | $ | 904,167 | ||||||
| NET ASSETS: | ||||||||||||
| Paid-in Capital (unlimited authorization — $0.01 par value) | $ | 3,193,449 | $ | 1,156,838 | $ | 904,165 | ||||||
Accumulated net realized gain (loss) on investments | (7 | ) | (14 | ) | 2 | |||||||
Net Assets | $ | 3,193,442 | $ | 1,156,824 | $ | 904,167 | ||||||
| Institutional Class Shares ($Dollars): | ||||||||||||
| Net Assets | $ | 96,452,291 | $ | 506,728,203 | $ | 137,665,448 | ||||||
| Total shares outstanding at end of year | 96,453,760 | 506,807,571 | 137,667,186 | |||||||||
| Net asset value, offering and redemption price per share | ||||||||||||
| (net assets ÷ shares outstanding) | $ | 1.00 | $ | 1.00 | $ | 1.00 | ||||||
| Class N Shares ($Dollars): | ||||||||||||
| Net Assets | $ | 2,808,067,900 | $ | 394,035,798 | $ | 666,531,441 | ||||||
| Total shares outstanding at end of year | 2,808,071,704 | 394,097,984 | 666,532,990 | |||||||||
| Net asset value, offering and redemption price per share | ||||||||||||
| (net assets ÷ shares outstanding) | $ | 1.00 | $ | 1.00 | $ | 1.00 | ||||||
| Class S Shares ($Dollars): | ||||||||||||
| Net Assets | $ | 288,921,922 | $ | 256,060,484 | $ | 99,970,081 | ||||||
| Total shares outstanding at end of year | 288,923,674 | 256,025,908 | 99,966,390 | |||||||||
| Net asset value, offering and redemption price per share | ||||||||||||
| (net assets ÷ shares outstanding) | $ | 1.00 | $ | 1.00 | $ | 1.00 | ||||||
| Amounts designated as “—” are either $0 or have been rounded to $0. |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 82
| statements of assets and liabilities (000) |
September 30, 2012 |
Limited Maturity Fixed Income Fund | Government Bond Fund | Corporate Bond Fund | California Tax Exempt Bond Fund | |||||||||||||
| ASSETS: | ||||||||||||||||
Cost of securities (including affiliated investments) | $ | 54,873 | $ | 184,508 | $ | 129,663 | $ | 56,501 | ||||||||
| Investments in securities, at value | $ | 53,542 | $ | 184,684 | $ | 133,345 | $ | 57,338 | ||||||||
| Affiliated investments, at value | 1,954 | 4,542 | 1,413 | 1,499 | ||||||||||||
| Cash | 17 | — | — | — | ||||||||||||
| Receivable for investment securities sold | 545 | — | — | — | ||||||||||||
| Dividend and income receivable | 323 | 608 | 1,139 | 656 | ||||||||||||
| Receivable for capital shares sold | — | 1,099 | 849 | 66 | ||||||||||||
Prepaid expenses | 1 | 3 | 2 | 1 | ||||||||||||
Total Assets | 56,382 | 190,936 | 136,748 | 59,560 | ||||||||||||
| LIABILITIES: | ||||||||||||||||
| Payable for income distributions | 19 | 68 | 198 | 87 | ||||||||||||
| Payable for capital shares redeemed | 2,525 | 1,147 | 125 | 45 | ||||||||||||
| Payable for investment securities purchased | 1,300 | 7,000 | — | 1,460 | ||||||||||||
| Investment adviser fees payable | 26 | 70 | 42 | 13 | ||||||||||||
| Shareholder servicing & distribution fees payable | 4 | 27 | 27 | 14 | ||||||||||||
| Administrative fees payable | 2 | 7 | 5 | 2 | ||||||||||||
Accrued expenses | 18 | 24 | 29 | 6 | ||||||||||||
Total Liabilities | 3,894 | 8,343 | 426 | 1,627 | ||||||||||||
Net Assets | $ | 52,488 | $ | 182,593 | $ | 136,322 | $ | 57,933 | ||||||||
| NET ASSETS: | ||||||||||||||||
| Paid-in Capital (unlimited authorization — $0.01 par value) | $ | 54,015 | $ | 178,782 | $ | 130,150 | $ | 55,169 | ||||||||
| Accumulated net realized gain (loss) on investments | (2,150 | ) | (907 | ) | 1,077 | 428 | ||||||||||
Net unrealized appreciation on investments | 623 | 4,718 | 5,095 | 2,336 | ||||||||||||
Net Assets | $ | 52,488 | $ | 182,593 | $ | 136,322 | $ | 57,933 | ||||||||
| Institutional Class Shares ($Dollars): | ||||||||||||||||
| Net Assets | $ | 48,140,353 | $ | 55,501,972 | $ | — | $ | — | ||||||||
| Total shares outstanding at end of year | 4,279,098 | 5,173,476 | — | — | ||||||||||||
| Net asset value, offering and redemption price per share | ||||||||||||||||
| (net assets ÷ shares outstanding) | $ | 11.25 | $ | 10.73 | $ | — | $ | — | ||||||||
| Class N Shares ($Dollars): | ||||||||||||||||
| Net Assets | $ | 4,347,229 | $ | 2,970,259 | $ | 2,535,162 | $ | 6,093,144 | ||||||||
| Total shares outstanding at end of year | 386,167 | 276,415 | 232,310 | 561,150 | ||||||||||||
| Net asset value, offering and redemption price per share | ||||||||||||||||
| (net assets ÷ shares outstanding) | $ | 11.26 | $ | 10.75 | $ | 10.91 | $ | 10.86 | ||||||||
| Servicing Class Shares ($Dollars)^: | ||||||||||||||||
| Net Assets | $ | — | $ | 124,121,155 | $ | 133,786,961 | $ | 51,839,687 | ||||||||
| Total shares outstanding at end of year | — | 11,573,869 | 12,273,969 | 4,788,216 | ||||||||||||
| Net asset value, offering and redemption price per share | ||||||||||||||||
| (net assets ÷ shares outstanding) | $ | — | $ | 10.72 | $ | 10.90 | $ | 10.83 | ||||||||
| ^ | Effective December 19, 2011, Institutional Class Shares were redesignated as Servicing Class Shares. This share class name change had no impact on the Fund’s operations or investment policy. |
| Amounts designated as “—” are either $0 or have been rounded to $0. |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 83
| statements of assets and liabilities (000) |
September 30, 2012 |
Full Maturity Fixed Income Fund | High Yield Bond Fund | Multi-Asset Fund | Diversified Equity Fund | |||||||||||||
| ASSETS: | ||||||||||||||||
Cost of securities (including affiliated investments) | $ | 44,681 | $ | 146,992 | $ | 42,740 | $ | 42,010 | ||||||||
| Investments in securities, at value | $ | 45,984 | $ | 145,789 | $ | 34,834 | $ | 44,442 | ||||||||
| Affiliated investments, at value | 1,045 | 4,630 | 9,806 | 2,152 | ||||||||||||
| Cash | 11 | 864 | 11 | — | ||||||||||||
| Dividend and income receivable | 333 | 3,500 | 108 | 33 | ||||||||||||
| Receivable for investment securities sold | 814 | 178 | — | 305 | ||||||||||||
| Receivable for capital shares sold | — | 374 | 98 | — | ||||||||||||
Prepaid expenses | 1 | 2 | 1 | 1 | ||||||||||||
Total Assets | 48,188 | 155,337 | 44,858 | 46,933 | ||||||||||||
| LIABILITIES: | ||||||||||||||||
| Payable for income distributions | 13 | 467 | 53 | 13 | ||||||||||||
| Payable for capital shares redeemed | 1,236 | 74 | — | 3,318 | ||||||||||||
| Payable for investment securities purchased | — | 875 | — | 321 | ||||||||||||
| Investment adviser fees payable | 20 | 94 | 18 | 25 | ||||||||||||
| Shareholder servicing & distribution fees payable | — | 39 | 12 | 2 | ||||||||||||
| Administrative fees payable | 2 | 6 | 2 | 2 | ||||||||||||
Accrued expenses | 16 | 17 | 6 | 16 | ||||||||||||
Total Liabilities | 1,287 | 1,572 | 91 | 3,697 | ||||||||||||
Net Assets | $ | 46,901 | $ | 153,765 | $ | 44,767 | $ | 43,236 | ||||||||
| NET ASSETS: | ||||||||||||||||
| Paid-in Capital (unlimited authorization — $0.01 par value) | $ | 43,598 | $ | 150,849 | $ | 46,525 | $ | 55,764 | ||||||||
| Undistributed net investment income | — | 23 | 19 | — | ||||||||||||
| Accumulated net realized gain (loss) on investments | 955 | (534 | ) | (3,677 | ) | (17,112 | ) | |||||||||
Net unrealized appreciation on investments | 2,348 | 3,427 | 1,900 | 4,584 | ||||||||||||
Net Assets | $ | 46,901 | $ | 153,765 | $ | 44,767 | $ | 43,236 | ||||||||
| Institutional Class Shares ($Dollars): | ||||||||||||||||
| Net Assets | $ | 46,594,895 | $ | 40,891,153 | $ | 12,535,826 | $ | 39,412,049 | ||||||||
| Total shares outstanding at end of year | 4,211,604 | 4,734,257 | 1,201,052 | 2,852,341 | ||||||||||||
| Net asset value, offering and redemption price per share | ||||||||||||||||
| (net assets ÷ shares outstanding) | $ | 11.06 | $ | 8.64 | $ | 10.44 | $ | 13.82 | ||||||||
| Class N Shares ($Dollars): | ||||||||||||||||
| Net Assets | $ | 306,302 | $ | 38,628,649 | $ | 25,001,719 | $ | 3,823,649 | ||||||||
| Total shares outstanding at end of year | 27,708 | 4,473,145 | 2,395,172 | 275,890 | ||||||||||||
| Net asset value, offering and redemption price per share | ||||||||||||||||
| (net assets ÷ shares outstanding) | $ | 11.05 | $ | 8.64 | $ | 10.44 | $ | 13.86 | ||||||||
| Servicing Class Shares ($Dollars)^: | ||||||||||||||||
| Net Assets | $ | — | $ | 74,245,320 | $ | 7,229,852 | $ | — | ||||||||
| Total shares outstanding at end of year | — | 8,598,833 | 691,827 | — | ||||||||||||
| Net asset value, offering and redemption price per share | ||||||||||||||||
| (net assets ÷ shares outstanding) | $ | — | $ | 8.63 | $ | 10.45 | $ | — | ||||||||
| ^ | Effective December 19, 2011, Institutional Class Shares were redesignated as Servicing Class Shares. This share class name change had no impact on the Fund’s operations or investment policy. |
| Amounts designated as “—” are either $0 or have been rounded to $0. |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 84
| statements of assets and liabilities (000) |
September 30, 2012 |
Large Cap Value Equity Fund | Large Cap Growth Equity Fund | Socially Responsible Equity Fund | ||||||||||
| ASSETS: | ||||||||||||
Cost of securities (including affiliated investments) | $ | 113,504 | $ | 39,692 | $ | 93,600 | ||||||
| Investments in securities, at value | $ | 120,382 | $ | 48,810 | $ | 106,218 | ||||||
| Affiliated investments, at value | 4,192 | 419 | — | |||||||||
| Cash | — | — | 8 | |||||||||
| Dividend and income receivable | 142 | 23 | 126 | |||||||||
| Receivable for investment securities sold | — | — | 4,395 | |||||||||
| Receivable for capital shares sold | 237 | 145 | 115 | |||||||||
Prepaid expenses | 2 | 1 | 1 | |||||||||
Total Assets | 124,955 | 49,398 | 110,863 | |||||||||
| LIABILITIES: | ||||||||||||
| Payable for income distributions | 113 | 16 | — | |||||||||
| Payable for capital shares redeemed | 337 | 2 | 131 | |||||||||
| Payable for investment securities purchased | — | — | 4,891 | |||||||||
| Investment adviser fees payable | 63 | 26 | 65 | |||||||||
| Shareholder servicing & distribution fees payable | 22 | 13 | 6 | |||||||||
| Administrative fees payable | 5 | 2 | 4 | |||||||||
Accrued expenses | 15 | 6 | 26 | |||||||||
Total Liabilities | 555 | 65 | 5,123 | |||||||||
Net Assets | $ | 124,400 | $ | 49,333 | $ | 105,740 | ||||||
| NET ASSETS: | ||||||||||||
| Paid-in Capital (unlimited authorization — $0.01 par value) | $ | 112,873 | $ | 39,560 | $ | 103,543 | ||||||
| Accumulated net realized gain (loss) on investments | 457 | 236 | (10,421 | ) | ||||||||
Net unrealized appreciation on investments | 11,070 | 9,537 | 12,618 | |||||||||
Net Assets | $ | 124,400 | $ | 49,333 | $ | 105,740 | ||||||
| Institutional Class Shares ($Dollars): | ||||||||||||
| Net Assets | $ | 33,445,054 | $ | — | $ | 80,109,390 | ||||||
| Total shares outstanding at end of year | 3,620,026 | — | 7,964,719 | |||||||||
| Net asset value, offering and redemption price per share | ||||||||||||
| (net assets ÷ shares outstanding) | $ | 9.24 | $ | — | $ | 10.06 | ||||||
| Class N Shares ($Dollars): | ||||||||||||
| Net Assets | $ | 9,883,041 | $ | 11,535,552 | $ | 25,631,057 | ||||||
| Total shares outstanding at end of year | 1,071,622 | 1,206,008 | 2,553,490 | |||||||||
| Net asset value, offering and redemption price per share | ||||||||||||
| (net assets ÷ shares outstanding) | $ | 9.22 | $ | 9.57 | $ | 10.04 | ||||||
| Servicing Class Shares ($Dollars)^: | ||||||||||||
| Net Assets | $ | 81,071,779 | $ | 37,797,173 | $ | — | ||||||
| Total shares outstanding at end of year | 8,775,289 | 3,906,841 | — | |||||||||
| Net asset value, offering and redemption price per share | ||||||||||||
| (net assets ÷ shares outstanding) | $ | 9.24 | $ | 9.67 | $ | — | ||||||
| ^ | Effective December 19, 2011, Institutional Class Shares were redesignated as Servicing Class Shares. This share class name change had no impact on the Fund’s operations or investment policy. |
| Amounts designated as “—” are either $0 or have been rounded to $0. |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 85
| statements of operations |
For the year ended September 30, 2012 |
Government Money Market Fund (000) | Prime Money Market Fund (000) | California Tax Exempt Money Market Fund (000) | ||||||||||
| INCOME: | ||||||||||||
Interest Income | $ | 4,887 | $ | 3,125 | $ | 1,205 | ||||||
Total Investment Income | 4,887 | 3,125 | 1,205 | |||||||||
| EXPENSES: | ||||||||||||
| Investment Advisory Fees | 8,621 | 3,091 | 2,476 | |||||||||
| Shareholder Servicing Fees — Institutional Class | 262 | 1,373 | 380 | |||||||||
Shareholder Servicing Fees — Class N(1) | 21,821 | 3,052 | 5,130 | |||||||||
Shareholder Servicing Fees — Class S(1) | 2,261 | 2,103 | 606 | |||||||||
| Administration Fees | 1,606 | 599 | 445 | |||||||||
| Transfer Agent Fees | 217 | 81 | 60 | |||||||||
| Trustee Fees | 159 | 61 | 44 | |||||||||
| Professional Fees | 447 | 159 | 133 | |||||||||
| Printing Fees | 144 | 48 | 39 | |||||||||
| Custody Fees | 146 | 54 | 12 | |||||||||
| Registration Fees | 128 | 53 | 37 | |||||||||
Insurance and Other Expenses | 293 | 117 | 86 | |||||||||
Total Expenses | 36,105 | 10,791 | 9,448 | |||||||||
| Less, Waivers of: | ||||||||||||
| Investment Advisory Fees | (6,662 | ) | (1,222 | ) | (2,066 | ) | ||||||
| Shareholder Servicing Fees — Institutional Class | (262 | ) | (1,373 | ) | (380 | ) | ||||||
Shareholder Servicing Fees — Class N(1) | (21,821 | ) | (3,011 | ) | (5,130 | ) | ||||||
Shareholder Servicing Fees — Class S(1) | (2,260 | ) | (2,065 | ) | (606 | ) | ||||||
| Administration Fees | (329 | ) | (123 | ) | (92 | ) | ||||||
Transfer Agent Fees | (217 | ) | (81 | ) | (60 | ) | ||||||
Net Expenses | 4,554 | 2,916 | 1,114 | |||||||||
Net Investment Income | 333 | 209 | 91 | |||||||||
Net Realized Loss from Securities Transactions | (2 | ) | (2 | ) | — | |||||||
Net Increase in Net Assets Resulting from Operations | $ | 331 | $ | 207 | $ | 91 | ||||||
| (1) | Includes class specific distribution expenses. |
| Amounts designated as “—” are either $0 or have been rounded to $0. |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 86
| statements of operations |
For the year ended September 30, 2012 |
Limited Maturity Fixed Income Fund (000) | Government Bond Fund (000) | Corporate Bond Fund (000) | California Tax Exempt Bond Fund (000) | |||||||||||||
| INCOME: | ||||||||||||||||
Interest Income | $ | 682 | $ | 2,821 | $ | 3,701 | $ | 1,713 | ||||||||
Total Investment Income | 682 | 2,821 | 3,701 | 1,713 | ||||||||||||
| EXPENSES: | ||||||||||||||||
| Investment Advisory Fees | 221 | 763 | 486 | 158 | ||||||||||||
Shareholder Servicing Fees — Class N(1) | 28 | 14 | 12 | 26 | ||||||||||||
| Shareholder Servicing Fees — Servicing Class | — | 364 | 298 | 134 | ||||||||||||
| Administration Fees | 21 | 86 | 59 | 28 | ||||||||||||
| Transfer Agent Fees | 41 | 13 | 8 | 4 | ||||||||||||
| Trustee Fees | 2 | 8 | 6 | 3 | ||||||||||||
| Professional Fees | 8 | 24 | 17 | 8 | ||||||||||||
| Custody Fees | 2 | 8 | 5 | 3 | ||||||||||||
| Registration Fees | 2 | 7 | 5 | 2 | ||||||||||||
| Printing Fees | 2 | 7 | 5 | 3 | ||||||||||||
Insurance and Other Expenses | 4 | 17 | 19 | 5 | ||||||||||||
Total Expenses | 331 | 1,311 | 920 | 374 | ||||||||||||
Recovery of Investment Advisory Fees Previously Waived(2) | — | 43 | 1 | — | ||||||||||||
| Less, Waivers of: | ||||||||||||||||
| Investment Advisory Fees | — | (25 | ) | — | (17 | ) | ||||||||||
| Shareholder Servicing Fees — Class N | (14 | ) | — | — | — | |||||||||||
Transfer Agent Fees | — | (13 | ) | (8 | ) | (4 | ) | |||||||||
Net Expenses | 317 | 1,316 | 913 | 353 | ||||||||||||
Net Investment Income | 365 | 1,505 | 2,788 | 1,360 | ||||||||||||
| Net Realized Gain from Securities Transactions | 330 | 19 | 1,084 | 462 | ||||||||||||
Net Change in Unrealized Appreciation on Investments | 120 | 638 | 3,119 | 781 | ||||||||||||
Net Increase in Net Assets Resulting from Operations | $ | 815 | $ | 2,162 | $ | 6,991 | $ | 2,603 | ||||||||
| (1) | Includes class specific distribution expenses. |
| (2) | See Note 4 for Advisory Fees recovered. |
| Amounts designated as “—” are either $0 or have been rounded to $0. |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 87
| statements of operations |
For the year ended September 30, 2012 |
Full Maturity Fixed Income Fund (000) | High Yield Bond Fund (000) | Multi-Asset Fund (000) | Diversified Equity Fund (000) | |||||||||||||
| INCOME: | ||||||||||||||||
| Dividend Income | $ | — | $ | 1 | $ | 1,009 | $ | 734 | ||||||||
| Dividend Income from Affiliated Investments | — | — | 223 | — | ||||||||||||
| Interest Income | 1,318 | 11,145 | 70 | — | ||||||||||||
Less: Foreign Taxes Withheld | — | — | — | (5 | ) | |||||||||||
Total Investment Income | 1,318 | 11,146 | 1,302 | 729 | ||||||||||||
| EXPENSES: | ||||||||||||||||
| Investment Advisory Fees | 232 | 951 | 231 | 371 | ||||||||||||
Shareholder Servicing Fees — Class N(1) | 2 | 185 | 132 | 22 | ||||||||||||
| Shareholder Servicing Fees — Servicing Class | — | 192 | 34 | — | ||||||||||||
| Administration Fees | 22 | 62 | 23 | 24 | ||||||||||||
| Transfer Agent Fees | 43 | 9 | 3 | 44 | ||||||||||||
| Trustee Fees | 2 | 6 | 2 | 2 | ||||||||||||
| Professional Fees | 6 | 20 | 6 | 7 | ||||||||||||
| Custody Fees | 2 | 5 | 2 | 2 | ||||||||||||
| Registration Fees | 2 | 4 | 2 | 3 | ||||||||||||
| Printing Fees | 2 | 6 | 2 | 2 | ||||||||||||
Insurance and Other Expenses | 4 | 10 | 4 | 4 | ||||||||||||
Total Expenses | 317 | 1,450 | 441 | 481 | ||||||||||||
Recovery of Investment Advisory Fees Previously Waived (2) | — | 10 | — | — | ||||||||||||
| Less, Waiver of: | ||||||||||||||||
| Investment Advisory Fees | — | (17 | ) | — | (24 | ) | ||||||||||
Shareholder Servicing Fees — Class N(1) | (1 | ) | — | — | (11 | ) | ||||||||||
Transfer Agent Fees | — | (9 | ) | (3 | ) | — | ||||||||||
Net Expenses | 316 | 1,434 | 438 | 446 | ||||||||||||
Net Investment Income | 1,002 | 9,712 | 864 | 283 | ||||||||||||
| Net Realized Gain (Loss) from Securities Transactions | 1,134 | 1,469 | (1,722 | ) | 2,951 | |||||||||||
| Net Realized Gain from Affiliated Investments | — | — | 76 | — | ||||||||||||
| Distributions of Realized Gains from Investment Company Shares | — | — | 39 | — | ||||||||||||
| Net Change in Unrealized Appreciation on Investments | 211 | 8,146 | 3,988 | 7,353 | ||||||||||||
Net Change in Unrealized Appreciation on Affiliated Investments | — | — | 187 | — | ||||||||||||
Net Increase in Net Assets Resulting from Operations | $ | 2,347 | $ | 19,327 | $ | 3,432 | $ | 10,587 | ||||||||
| (1) | Includes class specific distribution expenses. |
| (2) | See Note 4 for Advisory Fees recovered. |
| Amounts designated as “—” are either $0 or have been rounded to $0. |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 88
| statements of operations |
For the year ended September 30, 2012 |
Large Cap Value Equity Fund (000) | Large Cap Growth Equity Fund (000) | Socially Responsible Equity Fund (000) | ||||||||||
| INCOME: | ||||||||||||
| Dividend Income | $ | 2,924 | $ | 613 | $ | 2,074 | ||||||
Less: Foreign Taxes Withheld | (18 | ) | — | (16 | ) | |||||||
Total Investment Income | 2,906 | 613 | 2,058 | |||||||||
| EXPENSES: | ||||||||||||
| Investment Advisory Fees | 722 | 303 | 680 | |||||||||
Shareholder Servicing Fees — Class N(1) | 48 | 54 | 84 | |||||||||
| Shareholder Servicing Fees — Servicing Class | 224 | 89 | — | |||||||||
| Administration Fees | 57 | 23 | 44 | |||||||||
| Transfer Agent Fees | 8 | 3 | 56 | |||||||||
| Trustee Fees | 6 | 2 | 4 | |||||||||
| Professional Fees | 17 | 7 | 14 | |||||||||
| Custody Fees | 5 | 2 | 4 | |||||||||
| Printing Fees | 5 | 2 | 4 | |||||||||
| Registration Fees | 4 | 2 | 3 | |||||||||
Insurance and Other Expenses | 10 | 5 | 8 | |||||||||
Total Expenses | 1,106 | 492 | 901 | |||||||||
| Less, Waiver of: | ||||||||||||
| Shareholder Servicing Fees — Class N | — | — | (42 | ) | ||||||||
Transfer Agent Fees | (8 | ) | (3 | ) | — | |||||||
Net Expenses | 1,098 | 489 | 859 | |||||||||
Net Investment Income | 1,808 | 124 | 1,199 | |||||||||
| Net Realized Gain from Securities Transactions | 4,281 | 1,533 | 1,279 | |||||||||
Net Change in Unrealized Appreciation on Investments | 20,416 | 10,608 | 12,623 | |||||||||
Net Increase in Net Assets Resulting from Operations | $ | 26,505 | $ | 12,265 | $ | 15,101 | ||||||
| (1) | Includes class specific distribution expenses. |
| Amounts designated as “—” are either $0 or have been rounded to $0. |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 89
| statements of changes in net assets |
For the years ended September 30, |
Government Money Market Fund (000) | Prime Money Market Fund (000) | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
| OPERATIONS: | ||||||||||||||||
| Net Investment Income | $ | 333 | $ | 489 | $ | 209 | $ | 495 | ||||||||
| Net Realized Gain (Loss) from Security Transactions | (2 | ) | — | (2 | ) | (12 | ) | |||||||||
Net Change in Unrealized Appreciation (Depreciation) on Investments | — | — | — | — | ||||||||||||
Net Increase in Net Assets Resulting from Operations | 331 | 489 | 207 | 483 | ||||||||||||
| DIVIDENDS AND DISTRIBUTIONS FROM: | ||||||||||||||||
| Net Investment Income: | ||||||||||||||||
| Institutional Class | (11 | ) | (19 | ) | (127 | ) | (330 | ) | ||||||||
| Class N | (292 | ) | (458 | ) | (54 | ) | (146 | ) | ||||||||
| Class S | (30 | ) | (32 | ) | (28 | ) | (57 | ) | ||||||||
| Servicing Class^ | — | — | — | — | ||||||||||||
| Realized Capital Gains: | ||||||||||||||||
| Institutional Class | — | — | — | — | ||||||||||||
| Class N | — | — | — | — | ||||||||||||
Servicing Class^ | — | — | — | — | ||||||||||||
Total Dividends and Distributions | (333 | ) | (509 | ) | (209 | ) | (533 | ) | ||||||||
CAPITAL SHARE TRANSACTIONS:(1) | ||||||||||||||||
| Institutional Class: | ||||||||||||||||
| Shares Issued | 779,564 | 468,707 | 3,258,448 | 2,567,876 | ||||||||||||
| Shares Issued in Lieu of Dividends and Distributions | — | — | 21 | 51 | ||||||||||||
Shares Redeemed | (734,817 | ) | (498,052 | ) | (3,381,990 | ) | (2,427,636 | ) | ||||||||
Increase (Decrease) in Net Assets From Institutional Class Share Transactions | 44,747 | (29,345 | ) | (123,521 | ) | 140,291 | ||||||||||
| Class N: | ||||||||||||||||
| Shares Issued | 4,477,708 | 6,046,915 | 788,534 | 1,236,194 | ||||||||||||
| Shares Issued in Lieu of Dividends and Distributions | 237 | 374 | 37 | 93 | ||||||||||||
Shares Redeemed | (4,595,995 | ) | (5,719,187 | ) | (844,817 | ) | (1,218,312 | ) | ||||||||
Increase (Decrease) in Net Assets from Class N Share Transactions | (118,050 | ) | 328,102 | (56,246 | ) | 17,975 | ||||||||||
| Class S: | ||||||||||||||||
| Shares Issued | 903,404 | 849,467 | 1,112,831 | 1,490,167 | ||||||||||||
| Shares Issued in Lieu of Dividends and Distributions | — | — | — | — | ||||||||||||
Shares Redeemed | (905,676 | ) | (906,968 | ) | (1,121,886 | ) | (1,577,615 | ) | ||||||||
Increase (Decrease) in Net Assets from Class S Share Transactions | (2,272 | ) | (57,501 | ) | (9,055 | ) | (87,448 | ) | ||||||||
| Servicing Class^: | ||||||||||||||||
| Shares Issued | — | — | — | — | ||||||||||||
| Shares Issued in Lieu of Dividends and Distributions | — | — | — | — | ||||||||||||
Shares Redeemed | — | — | — | — | ||||||||||||
Increase (Decrease) in Net Assets from Servicing Class Share Transactions | — | — | — | — | ||||||||||||
Net Increase (Decrease) in Net Assets From Share Transactions | (75,575 | ) | 241,256 | (188,822 | ) | 70,818 | ||||||||||
Total Increase (Decrease) in Net Assets | (75,577 | ) | 241,236 | (188,824 | ) | 70,768 | ||||||||||
| NET ASSETS: | ||||||||||||||||
Beginning of Year | 3,269,019 | 3,027,783 | 1,345,648 | 1,274,880 | ||||||||||||
End of Year | $ | 3,193,442 | $ | 3,269,019 | $ | 1,156,824 | $ | 1,345,648 | ||||||||
Undistributed Net Investment Income | $ | — | $ | — | $ | — | $ | — | ||||||||
| (1) | See Note 8 for shares issued and redeemed. |
| (2) | Institutional Class commenced operations on February 1, 2012. |
| ^ | Effective December 19, 2011, Institutional Class Shares were redesignated as Servicing Class Shares. This share class name change had no impact on the Fund’s operations or investment policy. |
| Amounts designated as “—” are either $0 or have been rounded to $0. |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 90
California Tax Exempt Money Market Fund (000) | Limited Maturity Fixed Income Fund (000) | Government Bond Fund (000)(2) | Corporate Bond Fund (000) | |||||||||||||||||||||||||||
2012 | 2011 | 2012 | 2011 | 2012 | 2011 | 2012 | 2011 | |||||||||||||||||||||||
| $ | 91 | $ | 164 | $ | 365 | $ | 579 | $ | 1,505 | $ | 2,380 | $ | 2,788 | $ | 3,384 | |||||||||||||||
| — | — | 330 | 359 | 19 | 1,609 | 1,084 | 1,063 | |||||||||||||||||||||||
| — | — | 120 | (607 | ) | 638 | 1,187 | 3,119 | (3,970 | ) | |||||||||||||||||||||
| 91 | 164 | 815 | 331 | 2,162 | 5,176 | 6,991 | 477 | |||||||||||||||||||||||
| (15 | ) | (36 | ) | (348 | ) | (471 | ) | (431 | ) | — | — | — | ||||||||||||||||||
| (68 | ) | (121 | ) | (41 | ) | (108 | ) | (32 | ) | (52 | ) | (51 | ) | (63 | ) | |||||||||||||||
| (8 | ) | (7 | ) | — | — | — | — | — | — | |||||||||||||||||||||
| — | — | — | — | (1,969 | ) | (3,304 | ) | (2,744 | ) | (3,327 | ) | |||||||||||||||||||
| — | — | — | — | — | — | — | — | |||||||||||||||||||||||
| — | — | — | — | (2 | ) | — | (11 | ) | — | |||||||||||||||||||||
| — | — | — | — | (141 | ) | — | (527 | ) | — | |||||||||||||||||||||
| (91 | ) | (164 | ) | (389 | ) | (579 | ) | (2,575 | ) | (3,356 | ) | (3,333 | ) | (3,390 | ) | |||||||||||||||
| 1,079,873 | 1,057,959 | 41,212 | 2,339 | 59,073 | — | — | — | |||||||||||||||||||||||
| — | — | 206 | 306 | 412 | — | — | — | |||||||||||||||||||||||
| (1,112,139 | ) | (1,028,266 | ) | (25,396 | ) | (3,982 | ) | (4,191 | ) | — | — | — | ||||||||||||||||||
| (32,266 | ) | 29,693 | 16,022 | (1,337 | ) | 55,294 | — | — | — | |||||||||||||||||||||
| 1,072,087 | 1,294,708 | 1,021 | 8,524 | 410 | 529 | 458 | 1,077 | |||||||||||||||||||||||
| 66 | 117 | 41 | 76 | 19 | 29 | 38 | 33 | |||||||||||||||||||||||
| (1,033,785 | ) | (1,305,501 | ) | (3,167 | ) | (11,411 | ) | (392 | ) | (883 | ) | (514 | ) | (945 | ) | |||||||||||||||
| 38,368 | (10,676 | ) | (2,105 | ) | (2,811 | ) | 37 | (325 | ) | (18 | ) | 165 | ||||||||||||||||||
| 335,463 | 301,856 | — | — | — | — | — | — | |||||||||||||||||||||||
| — | — | — | — | — | — | — | — | |||||||||||||||||||||||
| (313,714 | ) | (271,899 | ) | — | — | — | — | — | — | |||||||||||||||||||||
| 21,749 | 29,957 | — | — | — | — | — | — | |||||||||||||||||||||||
| — | — | — | — | 49,341 | 56,798 | 60,716 | 40,990 | |||||||||||||||||||||||
| — | — | — | — | 1,378 | 2,397 | 1,069 | 1,062 | |||||||||||||||||||||||
| — | — | — | — | (101,850 | ) | (40,511 | ) | (43,147 | ) | (33,215 | ) | |||||||||||||||||||
| — | — | — | — | (51,131 | ) | 18,684 | 18,638 | 8,837 | ||||||||||||||||||||||
| 27,851 | 48,974 | 13,917 | (4,148 | ) | 4,200 | 18,359 | 18,620 | 9,002 | ||||||||||||||||||||||
| 27,851 | 48,974 | 14,343 | (4,396 | ) | 3,787 | 20,179 | 22,278 | 6,089 | ||||||||||||||||||||||
| 876,316 | 827,342 | 38,145 | 42,541 | 178,806 | 158,627 | 114,044 | 107,955 | |||||||||||||||||||||||
| $ | 904,167 | $ | 876,316 | $ | 52,488 | $ | 38,145 | $ | 182,593 | $ | 178,806 | $ | 136,322 | $ | 114,044 | |||||||||||||||
| $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 91
| statements of changes in net assets |
For the years ended September 30, |
California Tax Exempt Bond Fund (000) | Full Maturity Fixed Income Fund (000) | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
| OPERATIONS: | ||||||||||||||||
| Net Investment Income | $ | 1,360 | $ | 1,360 | $ | 1,002 | $ | 1,252 | ||||||||
| Net Realized Gain (Loss) from Security Transactions and Affiliated Investments | 462 | 362 | 1,134 | 609 | ||||||||||||
Net Change in Unrealized Appreciation (Depreciation) on Investments and Affiliated Investments | 781 | (50 | ) | 211 | (395 | ) | ||||||||||
Increase (Decrease) in Net Assets Resulting from Operations | 2,603 | 1,672 | 2,347 | 1,466 | ||||||||||||
| DIVIDENDS AND DISTRIBUTIONS FROM: | ||||||||||||||||
| Net Investment Income: | ||||||||||||||||
| Institutional Class | — | — | (1,056 | ) | (1,204 | ) | ||||||||||
| Class N | (105 | ) | (93 | ) | (8 | ) | (86 | ) | ||||||||
| Servicing Class^ | (1,255 | ) | (1,267 | ) | — | — | ||||||||||
| Realized Capital Gains: | ||||||||||||||||
| Institutional Class | — | — | (585 | ) | (225 | ) | ||||||||||
| Class N | (30 | ) | (14 | ) | (6 | ) | (22 | ) | ||||||||
Servicing Class^ | (365 | ) | (173 | ) | — | — | ||||||||||
Total Dividends and Distributions | (1,755 | ) | (1,547 | ) | (1,655 | ) | (1,537 | ) | ||||||||
CAPITAL SHARE TRANSACTIONS:(1) | ||||||||||||||||
| Institutional Class: | ||||||||||||||||
| Shares Issued | — | — | 2,933 | 1,116 | ||||||||||||
| Shares Issued in Lieu of Dividends and Distributions | — | — | 1,363 | 1,207 | ||||||||||||
Shares Redeemed | — | — | (2,282 | ) | (4,147 | ) | ||||||||||
Increase (Decrease) in Net Assets From Institutional Class Share Transactions | — | — | 2,014 | (1,824 | ) | |||||||||||
| Class N: | ||||||||||||||||
| Shares Issued | 3,425 | 1,527 | 94 | 2,493 | ||||||||||||
| Shares Issued in Lieu of Dividends and Distributions | 97 | 67 | 14 | 66 | ||||||||||||
Shares Redeemed | (2,064 | ) | (349 | ) | (304 | ) | (5,847 | ) | ||||||||
Increase (Decrease) in Net Assets from Class N Share Transactions | 1,458 | 1,245 | (196 | ) | (3,288 | ) | ||||||||||
| Servicing Class^: | ||||||||||||||||
| Shares Issued | 17,636 | 26,410 | — | — | ||||||||||||
| Shares Issued in Lieu of Dividends and Distributions | 703 | 691 | — | — | ||||||||||||
Shares Redeemed | (20,739 | ) | (14,210 | ) | — | — | ||||||||||
Increase (Decrease) in Net Assets from Servicing Class Share Transactions | (2,400 | ) | 12,891 | — | — | |||||||||||
Net Increase (Decrease) in Net Assets From Share Transactions | (942 | ) | 14,136 | 1,818 | (5,112 | ) | ||||||||||
Total Increase (Decrease) in Net Assets | (94 | ) | 14,261 | 2,510 | (5,183 | ) | ||||||||||
| NET ASSETS: | ||||||||||||||||
Beginning of Year | 58,027 | 43,766 | 44,391 | 49,574 | ||||||||||||
End of Year | $ | 57,933 | $ | 58,027 | $ | 46,901 | $ | 44,391 | ||||||||
Undistributed Net Investment Income | $ | — | $ | — | $ | — | $ | — | ||||||||
| (1) | See Note 8 for shares issued and redeemed. |
| (2) | Institutional Class commenced operations on February 2, 2012. |
| (3) | Institutional Class commenced operations on March 22, 2012. |
| ^ | Effective December 19, 2011, Institutional Class Shares were redesignated as Servicing Class Shares. This share class name change had no impact on the Fund’s operations or investment policy. |
| Amounts designated as “—” are either $0 or have been rounded to $0. |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 92
High Yield Bond Fund (000)(2) | Multi-Asset Fund (000)(3) | Diversified Equity Fund (000) | ||||||||||||||||||||
2012 | 2011 | 2012 | 2011 | 2012 | 2011 | |||||||||||||||||
| $ | 9,712 | $ | 6,045 | $ | 864 | $ | 675 | $ | 283 | $ | 232 | |||||||||||
| 1,469 | 1,560 | (1,607 | ) | 1,914 | 2,951 | 4,639 | ||||||||||||||||
| 8,146 | (5,656 | ) | 4,175 | (4,662 | ) | 7,353 | (6,927 | ) | ||||||||||||||
| 19,327 | 1,949 | 3,432 | (2,073 | ) | 10,587 | (2,056 | ) | |||||||||||||||
| (1,277 | ) | — | (193 | ) | — | (267 | ) | (224 | ) | |||||||||||||
| (2,482 | ) | (2,228 | ) | (470 | ) | (392 | ) | (16 | ) | (7 | ) | |||||||||||
| (5,925 | ) | (3,817 | ) | (236 | ) | (270 | ) | — | — | |||||||||||||
| — | — | — | — | — | — | |||||||||||||||||
| — | — | — | — | — | — | |||||||||||||||||
| — | — | — | — | — | — | |||||||||||||||||
| (9,684 | ) | (6,045 | ) | (899 | ) | (662 | ) | (283 | ) | (231 | ) | |||||||||||
| 42,923 | — | 15,151 | — | 328 | 3,691 | |||||||||||||||||
| 1,195 | — | 193 | — | 234 | 134 | |||||||||||||||||
| (3,910 | ) | — | (2,777 | ) | — | (20,515 | ) | (8,556 | ) | |||||||||||||
| 40,208 | — | 12,567 | — | (19,953 | ) | (4,731 | ) | |||||||||||||||
| 10,301 | 8,503 | 2,415 | 10,429 | 39 | 526 | |||||||||||||||||
| 1,589 | 1,349 | 303 | 228 | 16 | 4 | |||||||||||||||||
| (4,485 | ) | (3,817 | ) | (5,550 | ) | (4,754 | ) | (2,041 | ) | (2,060 | ) | |||||||||||
| 7,405 | 6,035 | (2,832 | ) | 5,903 | (1,986 | ) | (1,530 | ) | ||||||||||||||
| 71,253 | 50,134 | 4,333 | 10,915 | — | — | |||||||||||||||||
| 2,062 | 1,254 | 189 | 225 | — | — | |||||||||||||||||
| (71,307 | ) | (16,681 | ) | (17,484 | ) | (2,124 | ) | — | — | |||||||||||||
| 2,008 | 34,707 | (12,962 | ) | 9,016 | — | — | ||||||||||||||||
| 49,621 | 40,742 | (3,227 | ) | 14,919 | (21,939 | ) | (6,261 | ) | ||||||||||||||
| 59,264 | 36,646 | (694 | ) | 12,184 | (11,635 | ) | (8,548 | ) | ||||||||||||||
| 94,501 | 57,855 | 45,461 | 33,277 | 54,871 | 63,419 | |||||||||||||||||
| $ | 153,765 | $ | 94,501 | $ | 44,767 | $ | 45,461 | $ | 43,236 | $ | 54,871 | |||||||||||
| $ | 23 | $ | — | $ | 19 | $ | 15 | $ | — | $ | — | |||||||||||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 93
| statements of changes in net assets |
For the years ended September 30, |
Large Cap Value Equity Fund (000)(2) | Large Cap Growth Equity Fund (000) | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
| OPERATIONS: | ||||||||||||||||
| Net Investment Income | $ | 1,808 | $ | 1,480 | $ | 124 | $ | 47 | ||||||||
| Net Realized Gain (Loss) from Security Transactions | 4,281 | 4,640 | 1,533 | 3,717 | ||||||||||||
Net Change in Unrealized Appreciation (Depreciation) on Investments | 20,416 | (8,528 | ) | 10,608 | (5,911 | ) | ||||||||||
Increase (Decrease) in Net Assets Resulting from Operations | 26,505 | (2,408 | ) | 12,265 | (2,147 | ) | ||||||||||
| DIVIDENDS FROM: | ||||||||||||||||
| Net Investment Income: | ||||||||||||||||
| Institutional Class | (407 | ) | (1,364 | ) | — | — | ||||||||||
| Class N | (124 | ) | (114 | ) | (1 | ) | (6 | ) | ||||||||
Servicing Class^ | (1,277 | ) | — | (123 | ) | (56 | ) | |||||||||
Total Dividends | (1,808 | ) | (1,478 | ) | (124 | ) | (62 | ) | ||||||||
CAPITAL SHARE TRANSACTIONS:(1) | ||||||||||||||||
| Institutional Class: | ||||||||||||||||
| Shares Issued | 34,262 | — | — | — | ||||||||||||
| Shares Issued in Lieu of Dividends and Distributions | 407 | — | — | — | ||||||||||||
Shares Redeemed | (2,481 | ) | — | — | — | |||||||||||
Increase in Net Assets From Institutional Class Share Transactions | 32,188 | — | — | — | ||||||||||||
| Class N: | ||||||||||||||||
| Shares Issued | 878 | 615 | 1,148 | 1,461 | ||||||||||||
| Shares Issued in Lieu of Dividends and Distributions | 88 | 76 | 1 | 4 | ||||||||||||
Shares Redeemed | (2,245 | ) | (1,463 | ) | (1,679 | ) | (1,072 | ) | ||||||||
Increase (Decrease) in Net Assets From Class N Share Transactions | (1,279 | ) | (772 | ) | (530 | ) | 393 | |||||||||
| Servicing Class^: | ||||||||||||||||
| Shares Issued | 22,691 | 24,244 | 11,874 | 18,340 | ||||||||||||
| Shares Issued in Lieu of Dividends and Distributions | 893 | 1,032 | 45 | 22 | ||||||||||||
Shares Redeemed | (54,159 | ) | (26,063 | ) | (17,887 | ) | (13,444 | ) | ||||||||
Increase (Decrease) in Net Assets From Servicing Class Share Transactions | (30,575 | ) | (787 | ) | (5,968 | ) | 4,918 | |||||||||
Net Increase (Decrease) in Net Assets from Share Transactions | 334 | (1,559 | ) | (6,498 | ) | 5,311 | ||||||||||
Total Increase (Decrease) in Net Assets | 25,031 | (5,445 | ) | 5,643 | 3,102 | |||||||||||
| NET ASSETS: | ||||||||||||||||
Beginning of Year | 99,369 | 104,814 | 43,690 | 40,588 | ||||||||||||
End of Year | $ | 124,400 | $ | 99,369 | $ | 49,333 | $ | 43,690 | ||||||||
Undistributed Net Investment Income | $ | — | $ | — | $ | — | $ | — | ||||||||
| (1) | See Note 8 for shares issued and redeemed. |
| (2) | Institutional Class commenced operations on February 1, 2012. |
| ^ | Effective December 19, 2011, Institutional Class Shares were redesignated as Servicing Class Shares. This share class name change had no impact on the Fund’s operations or investment policy. |
| Amounts designated as “—” are either $0 or have been rounded to $0. |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 94
Socially Responsible Equity Fund (000) | ||||||
2012 | 2011 | |||||
| $ | 1,199 | $ | 901 | |||
| 1,279 | (1,057 | ) | ||||
| 12,623 | (2,820 | ) | ||||
| 15,101 | (2,976 | ) | ||||
| (995 | ) | (867 | ) | |||
| (204 | ) | (35 | ) | |||
| — | — | |||||
| (1,199 | ) | (902 | ) | |||
| 13,033 | 16,039 | |||||
| 994 | 867 | |||||
| (8,834 | ) | (10,863 | ) | |||
| 5,193 | 6,043 | |||||
| 23,297 | 1,850 | |||||
| 204 | 34 | |||||
| (2,181 | ) | (894 | ) | |||
| 21,320 | 990 | |||||
| — | — | |||||
| — | — | |||||
| — | — | |||||
| — | — | |||||
| 26,513 | 7,033 | |||||
| 40,415 | 3,155 | |||||
| 65,325 | 62,170 | |||||
| $ | 105,740 | $ | 65,325 | |||
| $ | — | $ | — | |||
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 95
| financial highlights |
For a Share Outstanding Throughout Each Period For the year or period ended September 30, |
Net Asset Value Beginning of Period | Net Investment Income† | Dividends from Net Investment Income | Net Asset Value End of Period | Total Return‡ | Net Assets End of Period (000) | Ratio of Expenses to Average Net Assets(1)(2) | Ratio of Net Investment Income to Average Net Assets(1) | Ratio of Expenses to Average Net Assets (Excluding Waivers & Recovered Fees)(1) | ||||||||||||||||||||||||||||
| Government Money Market Fund | ||||||||||||||||||||||||||||||||||||
| Institutional Class (commenced operations on April 3, 2000) | ||||||||||||||||||||||||||||||||||||
| 2012 | $ | 1.00 | $ | 0.000 | ^ | $ | (0.000 | )^ | $ | 1.00 | 0.01 | % | $ | 96,452 | 0.14 | % | 0.01 | % | 0.61 | % | ||||||||||||||||
| 2011 | 1.00 | 0.000 | ^ | (0.000 | )^ | 1.00 | 0.02 | 51,705 | 0.14 | 0.03 | 0.61 | |||||||||||||||||||||||||
| 2010 | 1.00 | 0.000 | ^ | (0.000 | )^ | 1.00 | 0.04 | 81,050 | 0.17 | 0.04 | 0.62 | |||||||||||||||||||||||||
| 2009 | 1.00 | 0.003 | (0.003 | ) | 1.00 | 0.27 | 123,863 | 0.36 | 0.26 | 0.65 | ||||||||||||||||||||||||||
| 2008 | 1.00 | 0.027 | (0.027 | ) | 1.00 | 2.72 | 100,674 | 0.59 | 2.62 | 0.59 | ||||||||||||||||||||||||||
| Class N (commenced operations on June 21, 1999) | ||||||||||||||||||||||||||||||||||||
| 2012 | $ | 1.00 | $ | 0.000 | ^ | $ | (0.000 | )^ | $ | 1.00 | 0.01 | % | $ | 2,808,068 | 0.14 | % | 0.01 | % | 1.11 | % | ||||||||||||||||
| 2011 | 1.00 | 0.000 | ^ | (0.000 | )^ | 1.00 | 0.02 | 2,926,120 | 0.14 | 0.02 | 1.11 | |||||||||||||||||||||||||
| 2010 | 1.00 | 0.000 | ^ | (0.000 | )^ | 1.00 | 0.02 | 2,598,035 | 0.19 | 0.02 | 1.12 | |||||||||||||||||||||||||
| 2009 | 1.00 | 0.002 | (0.002 | ) | 1.00 | 0.19 | 2,549,147 | 0.47 | 0.21 | 1.13 | ||||||||||||||||||||||||||
| 2008 | 1.00 | 0.025 | (0.025 | ) | 1.00 | 2.49 | 3,006,935 | 0.81 | 2.40 | 1.09 | ||||||||||||||||||||||||||
| Class S (commenced operations on October 6, 1999) | ||||||||||||||||||||||||||||||||||||
| 2012 | $ | 1.00 | $ | 0.000 | ^ | $ | (0.000 | )^ | $ | 1.00 | 0.01 | % | $ | 288,922 | 0.14 | % | 0.01 | % | 1.11 | % | ||||||||||||||||
| 2011 | 1.00 | 0.000 | ^ | (0.000 | )^ | 1.00 | 0.01 | 291,194 | 0.15 | 0.01 | 1.11 | |||||||||||||||||||||||||
| 2010 | 1.00 | 0.000 | ^ | (0.000 | )^ | 1.00 | 0.01 | 348,698 | 0.20 | 0.01 | 1.12 | |||||||||||||||||||||||||
| 2009 | 1.00 | 0.001 | (0.001 | ) | 1.00 | 0.12 | 298,842 | 0.54 | 0.13 | 1.13 | ||||||||||||||||||||||||||
| 2008 | 1.00 | 0.023 | (0.023 | ) | 1.00 | 2.29 | 408,747 | 1.02 | 2.23 | 1.09 | ||||||||||||||||||||||||||
Prime Money Market Fund | ||||||||||||||||||||||||||||||||||||
| Institutional Class (commenced operations on March 23, 1998) | ||||||||||||||||||||||||||||||||||||
| 2012 | $ | 1.00 | $ | 0.000 | ^ | $ | (0.000 | )^ | $ | 1.00 | 0.02 | % | $ | 506,728 | 0.23 | % | 0.02 | % | 0.60 | % | ||||||||||||||||
| 2011 | 1.00 | 0.001 | (0.001 | ) | 1.00 | 0.06 | 630,250 | 0.22 | 0.05 | 0.60 | ||||||||||||||||||||||||||
| 2010 | 1.00 | 0.001 | (0.001 | )* | 1.00 | 0.09 | 489,980 | 0.24 | 0.08 | 0.60 | ||||||||||||||||||||||||||
| 2009 | 1.00 | 0.005 | (0.005 | ) | 1.00 | 0.46 | 543,326 | 0.44 | 0.46 | 0.65 | ||||||||||||||||||||||||||
| 2008 | 1.00 | 0.030 | (0.030 | ) | 1.00 | 3.01 | 532,931 | 0.58 | 2.90 | 0.58 | ||||||||||||||||||||||||||
| Class N (commenced operations on October 18, 1999) | ||||||||||||||||||||||||||||||||||||
| 2012 | $ | 1.00 | $ | 0.000 | ^ | $ | (0.000 | )^ | $ | 1.00 | 0.01 | % | $ | 394,036 | 0.24 | % | 0.01 | % | 1.10 | % | ||||||||||||||||
| 2011 | 1.00 | 0.000 | ^ | (0.000 | )^ | 1.00 | 0.03 | 450,282 | 0.25 | 0.03 | 1.10 | |||||||||||||||||||||||||
| 2010 | 1.00 | 0.000 | ^ | (0.000 | )*^ | 1.00 | 0.06 | 432,235 | 0.28 | 0.04 | 1.10 | |||||||||||||||||||||||||
| 2009 | 1.00 | 0.003 | (0.003 | ) | 1.00 | 0.33 | 656,769 | 0.61 | 0.39 | 1.15 | ||||||||||||||||||||||||||
| 2008 | 1.00 | 0.027 | (0.027 | ) | 1.00 | 2.78 | 1,123,900 | 0.80 | 2.65 | 1.08 | ||||||||||||||||||||||||||
| Class S (commenced operations on October 26, 1999) | ||||||||||||||||||||||||||||||||||||
| 2012 | $ | 1.00 | $ | 0.000 | ^ | $ | (0.000 | )^ | $ | 1.00 | 0.01 | % | $ | 256,060 | 0.24 | % | 0.01 | % | 1.10 | % | ||||||||||||||||
| 2011 | 1.00 | 0.000 | ^ | 0.000 | ^ | 1.00 | 0.02 | 265,116 | 0.27 | 0.01 | 1.10 | |||||||||||||||||||||||||
| 2010 | 1.00 | 0.000 | ^ | (0.000 | )*^ | 1.00 | 0.04 | 352,575 | 0.30 | 0.02 | 1.10 | |||||||||||||||||||||||||
| 2009 | 1.00 | 0.002 | (0.002 | ) | 1.00 | 0.23 | 372,762 | 0.73 | 0.28 | 1.15 | ||||||||||||||||||||||||||
| 2008 | 1.00 | 0.025 | (0.025 | ) | 1.00 | 2.57 | 633,815 | 1.00 | 2.54 | 1.08 | ||||||||||||||||||||||||||
California Tax Exempt Money Market Fund | ||||||||||||||||||||||||||||||||||||
| Institutional Class (commenced operations on April 3, 2000) | ||||||||||||||||||||||||||||||||||||
| 2012 | $ | 1.00 | $ | 0.000 | ^ | $ | (0.000 | )^ | $ | 1.00 | 0.01 | % | $ | 137,665 | 0.12 | % | 0.01 | % | 0.61 | % | ||||||||||||||||
| 2011 | 1.00 | 0.000 | ^ | (0.000 | )^ | 1.00 | 0.02 | 169,932 | 0.16 | 0.02 | 0.62 | |||||||||||||||||||||||||
| 2010 | 1.00 | 0.000 | ^ | (0.000 | )*^ | 1.00 | 0.04 | 140,238 | 0.19 | 0.04 | 0.63 | |||||||||||||||||||||||||
| 2009 | 1.00 | 0.003 | (0.003 | ) | 1.00 | 0.33 | 141,579 | 0.30 | 0.31 | 0.65 | ||||||||||||||||||||||||||
| 2008 | 1.00 | 0.018 | (0.018 | ) | 1.00 | 1.80 | 157,427 | 0.55 | 1.69 | 0.61 | ||||||||||||||||||||||||||
| Class N (commenced operations on June 21, 1999) | ||||||||||||||||||||||||||||||||||||
| 2012 | $ | 1.00 | $ | 0.000 | ^ | $ | (0.000 | )^ | $ | 1.00 | 0.01 | % | $ | 666,532 | 0.12 | % | 0.01 | % | 1.11 | % | ||||||||||||||||
| 2011 | 1.00 | 0.000 | ^ | (0.000 | )^ | 1.00 | 0.02 | 628,163 | 0.17 | 0.02 | 1.12 | |||||||||||||||||||||||||
| 2010 | 1.00 | 0.000 | ^ | (0.000 | )*^ | 1.00 | 0.03 | 638,839 | 0.20 | 0.02 | 1.12 | |||||||||||||||||||||||||
| 2009 | 1.00 | 0.002 | (0.002 | ) | 1.00 | 0.23 | 704,840 | 0.41 | 0.25 | 1.16 | ||||||||||||||||||||||||||
| 2008 | 1.00 | 0.016 | (0.016 | ) | 1.00 | 1.57 | 880,794 | 0.78 | 1.47 | 1.11 | ||||||||||||||||||||||||||
| Class S (commenced operations on November 12, 1999) | ||||||||||||||||||||||||||||||||||||
| 2012 | $ | 1.00 | $ | 0.000 | ^ | $ | (0.000 | )^ | $ | 1.00 | 0.01 | % | $ | 99,970 | 0.12 | % | 0.01 | % | 1.11 | % | ||||||||||||||||
| 2011 | 1.00 | 0.000 | ^ | (0.000 | )^ | 1.00 | 0.01 | 78,221 | 0.17 | 0.01 | 1.12 | |||||||||||||||||||||||||
| 2010 | 1.00 | 0.000 | ^ | (0.000 | )*^ | 1.00 | 0.01 | 48,265 | 0.22 | 0.01 | 1.12 | |||||||||||||||||||||||||
| 2009 | 1.00 | 0.002 | (0.002 | ) | 1.00 | 0.17 | 74,396 | 0.54 | 0.26 | 1.16 | ||||||||||||||||||||||||||
| 2008 | 1.00 | 0.014 | (0.014 | ) | 1.00 | 1.37 | 141,757 | 0.98 | 1.40 | 1.11 | ||||||||||||||||||||||||||
| † | Per share calculations are based on Average Shares outstanding throughout the period. |
| ‡ | Returns are for the period indicated and have not been annualized. Fee waivers are in effect; if they had not been in effect, performance would have been lower. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. |
| ^ | Amount represents less than $0.001. |
| * | Includes a realized capital gain distribution of less than $0.001. |
| (1) | Annualized for periods less than one year. |
| (2) | Ratio includes waivers and previously waived investment advisory fees recovered. The impact of the recovered fees may cause a higher net expense ratio. |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 96
Net Asset Value Beginning of Period | Net Investment Income† | Net Realized and Unrealized Gains (Losses) on Securities† | Dividends from Net Investment Income | Distri-butions from Realized Capital Gains | Net Asset Value End of Period | Total Return‡ | Net Assets End of Period (000) | Ratio of Expenses to Average Net Assets(1)(2) | Ratio of Net Investment Income to Average Net Assets(1) | Ratio of Expenses to Average Net Assets (Excluding Waivers & Recovered Fees)(1) | Portfolio Turnover Rate | |||||||||||||||||||||||||||||||||||||
| Limited Maturity Fixed Income Fund | ||||||||||||||||||||||||||||||||||||||||||||||||
| Institutional Class (commenced operations on October 22,1988) | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 11.15 | $ | 0.09 | $ | 0.12 | $ | (0.11 | ) | $ | — | $ | 11.25 | 1.88 | % | $ | 48,141 | 0.68 | % | 0.85 | % | 0.68 | % | 87 | % | |||||||||||||||||||||||
| 2011 | 11.21 | 0.16 | (0.06 | ) | (0.16 | ) | — | 11.15 | 0.92 | 31,743 | 0.66 | 1.46 | 0.67 | 50 | ||||||||||||||||||||||||||||||||||
| 2010 | 11.06 | 0.20 | 0.16 | (0.21 | ) | — | 11.21 | 3.28 | 33,279 | 0.73 | 1.82 | 0.71 | 118 | |||||||||||||||||||||||||||||||||||
| 2009 | 10.49 | 0.30 | 0.57 | (0.30 | ) | — | 11.06 | 8.44 | 37,255 | 0.75 | 2.66 | 0.76 | 98 | |||||||||||||||||||||||||||||||||||
| 2008 | 10.59 | 0.37 | (0.10 | ) | (0.37 | ) | — | 10.49 | 2.54 | 92,681 | 0.76 | 3.44 | 0.67 | 79 | ||||||||||||||||||||||||||||||||||
| Class N (commenced operations on October 22, 2004) | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 11.15 | $ | 0.08 | $ | 0.11 | $ | (0.08 | ) | $ | — | $ | 11.26 | 1.71 | % | $ | 4,347 | 0.94 | % | 0.69 | % | 1.19 | % | 87 | % | |||||||||||||||||||||||
| 2011 | 11.22 | 0.14 | (0.08 | ) | (0.13 | ) | — | 11.15 | 0.58 | 6,402 | 0.91 | 1.21 | 1.17 | 50 | ||||||||||||||||||||||||||||||||||
| 2010 | 11.07 | 0.16 | 0.17 | (0.18 | ) | — | 11.22 | 3.04 | 9,262 | 0.98 | 1.48 | 1.22 | 118 | |||||||||||||||||||||||||||||||||||
| 2009 | 10.51 | 0.27 | 0.57 | (0.28 | ) | — | 11.07 | 8.07 | 1,471 | 1.00 | 2.29 | 1.24 | 98 | |||||||||||||||||||||||||||||||||||
| 2008 | 10.61 | 0.35 | (0.10 | ) | (0.35 | ) | — | 10.51 | 2.29 | 432 | 1.00 | 3.24 | 0.92 | 79 | ||||||||||||||||||||||||||||||||||
Government Bond Fund | ||||||||||||||||||||||||||||||||||||||||||||||||
| Institutional Class (commenced operations on February 1, 2012) | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 10.75 | $ | 0.05 | $ | 0.04 | $ | (0.11 | ) | $ | — | $ | 10.73 | 0.82 | % | $ | 55,502 | 0.55 | % | 0.96 | % | 0.53 | % | 55 | % | |||||||||||||||||||||||
| Class N (commenced operations on April 13, 2000) | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 10.77 | $ | 0.06 | $ | 0.05 | $ | (0.12 | ) | $ | (0.01 | ) | $ | 10.75 | 0.99 | % | $ | 2,970 | 1.03 | % | 0.56 | % | 1.03 | % | 55 | % | ||||||||||||||||||||||
| 2011 | 10.68 | 0.12 | 0.15 | (0.18 | ) | — | 10.77 | 2.60 | 2,940 | 0.95 | 1.17 | 1.03 | 86 | |||||||||||||||||||||||||||||||||||
| 2010 | 10.60 | 0.16 | 0.16 | (0.24 | ) | — | 10.68 | 3.10 | 3,251 | 0.95 | 1.57 | 1.03 | 93 | |||||||||||||||||||||||||||||||||||
| 2009 | 10.42 | 0.32 | 0.18 | (0.32 | ) | — | 10.60 | 4.91 | 3,109 | 0.95 | 3.04 | 1.02 | 85 | |||||||||||||||||||||||||||||||||||
| 2008 | 10.35 | 0.40 | 0.07 | (0.40 | ) | — | 10.42 | 4.59 | 2,761 | 0.95 | 3.80 | 1.02 | 36 | |||||||||||||||||||||||||||||||||||
Servicing Class (commenced operations on January 14, 2000)^ | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 10.75 | $ | 0.09 | $ | 0.03 | $ | (0.14 | ) | $ | (0.01 | ) | $ | 10.72 | 1.15 | % | $ | 124,121 | 0.77 | % | 0.83 | % | 0.78 | % | 55 | % | ||||||||||||||||||||||
| 2011 | 10.66 | 0.15 | 0.15 | (0.21 | ) | — | 10.75 | 2.86 | 175,866 | 0.70 | 1.40 | 0.78 | 86 | |||||||||||||||||||||||||||||||||||
| 2010 | 10.58 | 0.19 | 0.16 | (0.27 | ) | — | 10.66 | 3.37 | 155,376 | 0.70 | 1.81 | 0.78 | 93 | |||||||||||||||||||||||||||||||||||
| 2009 | 10.40 | 0.35 | 0.18 | (0.35 | ) | — | 10.58 | 5.18 | 71,966 | 0.70 | 3.29 | 0.77 | 85 | |||||||||||||||||||||||||||||||||||
| 2008 | 10.33 | 0.42 | 0.08 | (0.43 | ) | — | 10.40 | 4.87 | 66,097 | 0.70 | 4.05 | 0.77 | 36 | |||||||||||||||||||||||||||||||||||
Corporate Bond Fund | ||||||||||||||||||||||||||||||||||||||||||||||||
| Class N (commenced operations on April 13, 2000) | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 10.59 | $ | 0.22 | $ | 0.37 | $ | (0.22 | ) | $ | (0.05 | ) | $ | 10.91 | 5.62 | % | $ | 2,535 | 1.00 | % | 2.05 | % | 1.00 | % | 31 | % | ||||||||||||||||||||||
| 2011 | 10.89 | 0.29 | (0.30 | ) | (0.29 | ) | — | 10.59 | (0.10 | ) | 2,481 | 1.00 | 2.69 | 1.00 | 40 | |||||||||||||||||||||||||||||||||
| 2010 | 10.57 | 0.33 | 0.32 | (0.33 | ) | — | 10.89 | 6.23 | 2,384 | 0.99 | 3.05 | 1.00 | 28 | |||||||||||||||||||||||||||||||||||
| 2009 | 9.77 | 0.36 | 0.81 | (0.37 | ) | — | 10.57 | 12.19 | 995 | 0.99 | 3.59 | 1.00 | 30 | |||||||||||||||||||||||||||||||||||
| 2008 | 10.18 | 0.41 | (0.41 | ) | (0.41 | ) | — | 9.77 | (0.11 | ) | 608 | 0.98 | 4.02 | 0.99 | 12 | |||||||||||||||||||||||||||||||||
| Servicing Class (commenced operations on January 14, 2000)^ | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 10.58 | $ | 0.25 | $ | 0.37 | $ | (0.25 | ) | $ | (0.05 | ) | $ | 10.90 | 5.89 | % | $ | 133,787 | 0.75 | % | 2.30 | % | 0.75 | % | 31 | % | ||||||||||||||||||||||
| 2011 | 10.88 | 0.32 | (0.30 | ) | (0.32 | ) | — | 10.58 | 0.15 | 111,563 | 0.75 | 2.94 | 0.75 | 40 | ||||||||||||||||||||||||||||||||||
| 2010 | 10.56 | 0.35 | 0.32 | (0.35 | ) | — | 10.88 | 6.50 | 105,571 | 0.74 | 3.32 | 0.75 | 28 | |||||||||||||||||||||||||||||||||||
| 2009 | 9.76 | 0.39 | 0.80 | (0.39 | ) | — | 10.56 | 12.48 | 88,897 | 0.74 | 3.88 | 0.75 | 30 | |||||||||||||||||||||||||||||||||||
| 2008 | 10.18 | 0.43 | (0.41 | ) | (0.44 | ) | — | 9.76 | 0.04 | 69,709 | 0.73 | 4.25 | 0.74 | 12 | ||||||||||||||||||||||||||||||||||
California Tax Exempt Bond Fund | ||||||||||||||||||||||||||||||||||||||||||||||||
| Class N (commenced operations on April 13, 2000) | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 10.70 | $ | 0.22 | $ | 0.23 | $ | (0.22 | ) | $ | (0.07 | ) | $ | 10.86 | 4.32 | % | $ | 6,093 | 0.83 | % | 2.07 | % | 0.86 | % | 27 | % | ||||||||||||||||||||||
| 2011 | 10.73 | 0.26 | 0.01 | (0.26 | ) | (0.04 | ) | 10.70 | 2.65 | 4,563 | 0.75 | 2.46 | 0.87 | 26 | ||||||||||||||||||||||||||||||||||
| 2010 | 10.60 | 0.29 | 0.13 | (0.29 | ) | — | 10.73 | 4.06 | 3,309 | 0.75 | 2.75 | 0.87 | 28 | |||||||||||||||||||||||||||||||||||
| 2009 | 10.09 | 0.30 | 0.51 | (0.30 | ) | — | 10.60 | 8.15 | 1,902 | 0.75 | 2.92 | 0.87 | 50 | |||||||||||||||||||||||||||||||||||
| 2008 | 10.27 | 0.30 | (0.18 | ) | (0.30 | ) | — | 10.09 | 1.12 | 1,049 | 0.75 | 2.87 | 0.86 | 55 | ||||||||||||||||||||||||||||||||||
| Servicing Class (commenced operations on January 14, 2000)^ | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 10.67 | $ | 0.25 | $ | 0.23 | $ | (0.25 | ) | $ | (0.07 | ) | $ | 10.83 | 4.59 | % | $ | 51,840 | 0.58 | % | 2.34 | % | 0.61 | % | 27 | % | ||||||||||||||||||||||
| 2011 | 10.70 | 0.29 | 0.01 | (0.29 | ) | (0.04 | ) | 10.67 | 2.92 | 53,464 | 0.50 | 2.73 | 0.62 | 26 | ||||||||||||||||||||||||||||||||||
| 2010 | 10.57 | 0.32 | 0.13 | (0.32 | ) | — | 10.70 | 4.34 | 40,457 | 0.50 | 3.03 | 0.62 | 28 | |||||||||||||||||||||||||||||||||||
| 2009 | 10.06 | 0.33 | 0.51 | (0.33 | ) | — | 10.57 | 8.45 | 38,581 | 0.50 | 3.18 | 0.61 | 50 | |||||||||||||||||||||||||||||||||||
| 2008 | 10.24 | 0.32 | (0.18 | ) | (0.32 | ) | — | 10.06 | 1.38 | 34,262 | 0.50 | 3.13 | 0.61 | 55 | ||||||||||||||||||||||||||||||||||
| † | Per share calculations are based on Average Shares outstanding throughout the period. |
| ‡ | Returns are for the period indicated and have not been annualized. Fee waivers are in effect; if they had not been in effect, performance would have been lower. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. |
| ^ | Effective December 19, 2011, Institutional Class Shares were redesignated as Servicing Class Shares. This share class name change had no impact on the Fund’s operations or investment policy. |
| (1) | Annualized for periods less than one year. |
| (2) | Ratio includes waivers and previously waived investment advisory fees recovered. The impact of the recovered fees may cause a higher net expense ratio. |
| Amounts designated as “—” are either $0 or have been rounded to $0. |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 97
| financial highlights |
For a Share Outstanding Throughout Each Period For the year or period ended September 30, |
Net Asset Value Beginning of Period | Net Investment Income† | Net Realized and Unrealized Gains (Losses) on Securities† | Dividends from Net Investment Income | Distri-butions from Realized Capital Gains | Net Asset Value End of Period | Total Return‡ | Net Assets End of Period (000) | Ratio of Expenses to Average Net Assets(1)(2) | Ratio of Net Investment Income to Average Net Assets(1) | Ratio of Expenses to Average Net Assets (Excluding Waivers & Recovered Fees)(1) | Portfolio Turnover Rate | |||||||||||||||||||||||||||||||||||||
| Full Maturity Fixed Income Fund | ||||||||||||||||||||||||||||||||||||||||||||||||
| Institutional Class (commenced operations on October 20, 1988) | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 10.91 | $ | 0.24 | $ | 0.30 | $ | (0.25 | ) | $ | (0.14 | ) | $ | 11.06 | 5.11 | % | $ | 46,595 | 0.68 | % | 2.16 | % | 0.68 | % | 68 | % | ||||||||||||||||||||||
| 2011 | 10.91 | 0.29 | 0.07 | (0.30 | ) | (0.06 | ) | 10.91 | 3.36 | 43,894 | 0.66 | 2.70 | 0.67 | 43 | ||||||||||||||||||||||||||||||||||
| 2010 | 10.46 | 0.36 | 0.50 | (0.36 | ) | (0.05 | ) | 10.91 | 8.48 | 45,756 | 0.70 | 3.40 | 0.71 | 63 | ||||||||||||||||||||||||||||||||||
| 2009 | 9.90 | 0.40 | 0.56 | (0.40 | ) | — | 10.46 | 9.95 | 39,495 | 0.75 | 3.97 | 0.75 | 56 | |||||||||||||||||||||||||||||||||||
| 2008 | 10.16 | 0.44 | (0.26 | ) | (0.44 | ) | — | 9.90 | 1.76 | 42,579 | 0.64 | 4.32 | 0.64 | 34 | ||||||||||||||||||||||||||||||||||
| Class N (commenced operations on May 11, 2004) | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 10.90 | $ | 0.21 | $ | 0.30 | $ | (0.22 | ) | $ | (0.14 | ) | $ | 11.05 | 4.85 | % | $ | 306 | 0.93 | % | 1.94 | % | 1.18 | % | 68 | % | ||||||||||||||||||||||
| 2011 | 10.90 | 0.26 | 0.07 | (0.27 | ) | (0.06 | ) | 10.90 | 3.10 | 497 | 0.91 | 2.46 | 1.17 | 43 | ||||||||||||||||||||||||||||||||||
| 2010 | 10.46 | 0.33 | 0.50 | (0.34 | ) | (0.05 | ) | 10.90 | 8.12 | 3,818 | 0.95 | 3.08 | 1.21 | 63 | ||||||||||||||||||||||||||||||||||
| 2009 | 9.89 | 0.39 | 0.56 | (0.38 | ) | — | 10.46 | 9.79 | 1,086 | 1.00 | 3.70 | 1.26 | 56 | |||||||||||||||||||||||||||||||||||
| 2008 | 10.16 | 0.42 | (0.27 | ) | (0.42 | ) | — | 9.89 | 1.42 | 687 | 0.89 | 4.02 | 0.89 | 34 | ||||||||||||||||||||||||||||||||||
High Yield Bond Fund | ||||||||||||||||||||||||||||||||||||||||||||||||
| Institutional Class (commenced operations on February 2, 2012) | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 8.39 | $ | 0.43 | $ | 0.26 | $ | (0.44 | ) | $ | — | $ | 8.64 | 8.39 | % | $ | 40,891 | 0.85 | % | 7.66 | % | 0.85 | % | 41 | % | |||||||||||||||||||||||
| Class N (commenced operations on January 14, 2000) | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 7.98 | $ | 0.62 | $ | 0.66 | $ | (0.62 | ) | $ | — | $ | 8.64 | 16.56 | % | $ | 38,629 | 1.38 | % | 7.43 | % | 1.39 | % | 41 | % | |||||||||||||||||||||||
| 2011 | 8.31 | 0.69 | (0.33 | ) | (0.69 | ) | — | 7.98 | 4.14 | 28,672 | 1.30 | 8.12 | 1.40 | 56 | ||||||||||||||||||||||||||||||||||
| 2010 | 7.56 | 0.70 | 0.74 | (0.69 | ) | — | 8.31 | 19.81 | 24,010 | 1.30 | 8.68 | 1.40 | 87 | |||||||||||||||||||||||||||||||||||
| 2009 | 7.40 | 0.60 | 0.18 | (0.62 | ) | — | 7.56 | 12.61 | 19,637 | 1.30 | 9.43 | 1.40 | 59 | |||||||||||||||||||||||||||||||||||
| 2008 | 8.91 | 0.62 | (1.47 | ) | (0.66 | ) | — | 7.40 | (10.10 | ) | 17,521 | 1.30 | 7.43 | 1.39 | 20 | |||||||||||||||||||||||||||||||||
| Servicing Class (commenced operations on January 14, 2000)^^ | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 7.98 | $ | 0.65 | $ | 0.65 | $ | (0.65 | ) | $ | — | $ | 8.63 | 16.77 | % | $ | 74,245 | 1.08 | % | 7.76 | % | 1.09 | % | 41 | % | |||||||||||||||||||||||
| 2011 | 8.31 | 0.72 | (0.33 | ) | (0.72 | ) | — | 7.98 | 4.45 | 65,829 | 1.00 | 8.43 | 1.10 | 56 | ||||||||||||||||||||||||||||||||||
| 2010 | 7.56 | 0.72 | 0.75 | (0.72 | ) | — | 8.31 | 20.17 | 33,845 | 1.00 | 8.89 | 1.10 | 87 | |||||||||||||||||||||||||||||||||||
| 2009 | 7.40 | 0.62 | 0.18 | (0.64 | ) | — | 7.56 | 12.94 | 16,355 | 1.00 | 9.75 | 1.10 | 59 | |||||||||||||||||||||||||||||||||||
| 2008 | 8.91 | 0.64 | (1.47 | ) | (0.68 | ) | — | 7.40 | (9.83 | ) | 13,926 | 1.00 | 7.72 | 1.09 | 20 | |||||||||||||||||||||||||||||||||
Multi-Asset Fund | ||||||||||||||||||||||||||||||||||||||||||||||||
| Institutional Class (commenced operations on March 22, 2012) | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 10.45 | $ | 0.12 | $ | 0.03 | $ | (0.16 | ) | $ | — | $ | 10.44 | 1.45 | % | $ | 12,536 | 0.59 | % | 2.17 | % | 0.61 | % | 89 | % | |||||||||||||||||||||||
| Class N (commenced operations on October 1, 2007) | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 9.88 | $ | 0.18 | $ | 0.57 | $ | (0.19 | ) | $ | — | $ | 10.44 | 7.61 | % | $ | 25,001 | 1.09 | % | 1.72 | % | 1.10 | % | 89 | % | |||||||||||||||||||||||
| 2011 | 10.36 | 0.17 | (0.48 | ) | (0.17 | ) | — | 9.88 | (3.11 | ) | 26,377 | 1.09 | 1.57 | 1.10 | 67 | |||||||||||||||||||||||||||||||||
| 2010 | 9.86 | 0.17 | 0.50 | (0.17 | ) | — | 10.36 | 6.89 | 22,019 | 1.09 | 1.69 | 1.10 | 76 | |||||||||||||||||||||||||||||||||||
| 2009 | 9.69 | 0.13 | 0.18 | (0.14 | ) | — | 9.86 | 3.29 | 16,837 | 1.09 | 1.46 | 1.10 | 94 | |||||||||||||||||||||||||||||||||||
| 2008 | 11.00 | 0.23 | (1.33 | ) | (0.21 | ) | — | 9.69 | (10.12 | ) | 16,708 | 1.53 | 2.22 | 1.54 | 141 | |||||||||||||||||||||||||||||||||
| Servicing Class (commenced operations on October 1, 2007)^^ | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 9.88 | $ | 0.20 | $ | 0.57 | $ | (0.20 | ) | $ | — | $ | 10.45 | 7.89 | % | $ | 7,230 | 0.84 | % | 1.99 | % | 0.84 | % | 89 | % | |||||||||||||||||||||||
| 2011 | 10.37 | 0.19 | (0.48 | ) | (0.20 | ) | — | 9.88 | (2.97 | ) | 19,084 | 0.84 | 1.76 | 0.85 | 67 | |||||||||||||||||||||||||||||||||
| 2010 | 9.87 | 0.20 | 0.50 | (0.20 | ) | — | 10.37 | 7.15 | 11,258 | 0.84 | 1.96 | 0.85 | 76 | |||||||||||||||||||||||||||||||||||
| 2009 | 9.70 | 0.15 | 0.18 | (0.16 | ) | — | 9.87 | 3.54 | 8,423 | 0.83 | 1.71 | 0.84 | 94 | |||||||||||||||||||||||||||||||||||
| 2008 | 11.00 | 0.25 | (1.32 | ) | (0.23 | ) | — | 9.70 | (9.84 | ) | 10,741 | 1.29 | 2.37 | 1.30 | 141 | |||||||||||||||||||||||||||||||||
Diversified Equity Fund | ||||||||||||||||||||||||||||||||||||||||||||||||
| Institutional Class (commenced operations on October 20, 1988) | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 11.33 | $ | 0.08 | $ | 2.49 | $ | (0.08 | ) | $ | — | $ | 13.82 | 22.75 | % | $ | 39,412 | 0.88 | % | 0.60 | % | 0.93 | % | 72 | % | |||||||||||||||||||||||
| 2011 | 11.88 | 0.05 | (0.55 | ) | (0.05 | ) | — | 11.33 | (4.27 | ) | 50,029 | 0.89 | 0.37 | 0.90 | 112 | |||||||||||||||||||||||||||||||||
| 2010 | 11.19 | 0.06 | 0.69 | (0.06 | )* | — | 11.88 | 6.69 | 56,809 | 0.94 | 0.51 | 0.95 | 105 | |||||||||||||||||||||||||||||||||||
| 2009 | 12.19 | 0.11 | (1.00 | ) | (0.11 | )^ | — | 11.19 | (7.08 | ) | 50,425 | 0.98 | 1.15 | 0.99 | 93 | |||||||||||||||||||||||||||||||||
| 2008 | 18.48 | 0.14 | (3.84 | ) | (0.14 | ) | (2.45 | ) | 12.19 | (22.73 | ) | 74,997 | 0.97 | 0.98 | 0.94 | 143 | ||||||||||||||||||||||||||||||||
| Class N (commenced operations on December 30, 2002) | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 11.37 | $ | 0.04 | $ | 2.50 | $ | (0.05 | ) | $ | — | $ | 13.86 | 22.35 | % | $ | 3,824 | 1.13 | % | 0.34 | % | 1.43 | % | 72 | % | |||||||||||||||||||||||
| 2011 | 11.92 | 0.02 | (0.56 | ) | (0.01 | ) | — | 11.37 | (4.50 | ) | 4,842 | 1.14 | 0.11 | 1.40 | 112 | |||||||||||||||||||||||||||||||||
| 2010 | 11.22 | 0.03 | 0.70 | (0.03 | ) | — | 11.92 | 6.50 | 6,610 | 1.19 | 0.26 | 1.45 | 105 | |||||||||||||||||||||||||||||||||||
| 2009 | 12.22 | 0.09 | (1.00 | ) | (0.09 | ) | — | 11.22 | (7.30 | ) | 5,560 | 1.23 | 0.91 | 1.49 | 93 | |||||||||||||||||||||||||||||||||
| 2008 | 18.52 | 0.11 | (3.85 | ) | (0.11 | ) | (2.45 | ) | 12.22 | (22.93 | ) | 7,102 | 1.22 | 0.74 | 1.19 | 143 | ||||||||||||||||||||||||||||||||
| † | Per share calculations are based on Average Shares outstanding throughout the period. |
| ‡ | Returns are for the period indicated and have not been annualized. Fee waivers are in effect; if they had not been in effect, performance would have been lower. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. |
| * | Includes return of capital less than $0.01 per share. |
| ^ | Includes return of capital of $0.01 per share. |
| ^^ | Effective December 19, 2011, Institutional Class Shares were redesignated as Servicing Class Shares. This share class name change had no impact on the Fund’s operations or investment policy. |
| (1) | Annualized for periods less than one year. |
| (2) | Ratio includes waivers and previously waived investment advisory fees recovered. The impact of the recovered fees may cause a higher net expense ratio. |
| Amounts designated as “—” are either $0 or have been rounded to $0. |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 98
Net Asset Value Beginning of Period | Net Investment Income (Loss)† | Net Realized and Unrealized Gains (Losses) on Securities† | Dividends from Net Investment Income | Distri-butions from Realized Capital Gains | Net Asset Value End of Period | Total Return‡ | Net Assets End of Period (000) | Ratio of Expenses to Average Net Assets(1)(2) | Ratio of Net Investment Income (Loss) to Average Net Assets(1) | Ratio of Expenses to Average Net Assets (Excluding Waivers & Recovered Fees)(1) | Portfolio Turnover Rate | |||||||||||||||||||||||||||||||||||||
| Large Cap Value Equity Fund | ||||||||||||||||||||||||||||||||||||||||||||||||
| Institutional Class (commenced operations on February 1, 2012) | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 8.59 | $ | 0.10 | $ | 0.67 | $ | (0.12 | ) | $ | — | $ | 9.24 | 8.95 | % | $ | 33,445 | 0.71 | % | 1.78 | % | 0.72 | % | 30 | % | |||||||||||||||||||||||
| Class N (commenced operations on April 13, 2000) | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 7.40 | $ | 0.11 | $ | 1.82 | $ | (0.11 | ) | $ | — | $ | 9.22 | 26.18 | % | $ | 9,883 | 1.21 | % | 1.29 | % | 1.22 | % | 30 | % | |||||||||||||||||||||||
| 2011 | 7.67 | 0.09 | (0.27 | ) | (0.09 | ) | — | 7.40 | (2.45 | ) | 9,064 | 1.21 | 1.09 | 1.22 | 43 | |||||||||||||||||||||||||||||||||
| 2010 | 7.27 | 0.08 | 0.40 | (0.08 | ) | — | 7.67 | 6.59 | 10,089 | 1.21 | 1.03 | 1.22 | 26 | |||||||||||||||||||||||||||||||||||
| 2009 | 8.24 | 0.12 | (0.98 | ) | (0.11 | ) | — | 7.27 | (10.27 | ) | 8,960 | 1.21 | 1.89 | 1.22 | 18 | |||||||||||||||||||||||||||||||||
| 2008 | 11.19 | 0.13 | (2.46 | ) | (0.13 | ) | (0.49 | ) | 8.24 | (21.72 | ) | 11,712 | 1.20 | 1.38 | 1.21 | 36 | ||||||||||||||||||||||||||||||||
| Servicing Class (commenced operations on January 14, 2000)^^ | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 7.41 | $ | 0.13 | $ | 1.83 | $ | (0.13 | ) | $ | — | $ | 9.24 | 26.57 | % | $ | 81,072 | 0.96 | % | 1.54 | % | 0.97 | % | 30 | % | |||||||||||||||||||||||
| 2011 | 7.68 | 0.11 | (0.27 | ) | (0.11 | ) | — | 7.41 | (2.20 | ) | 90,305 | 0.96 | 1.34 | 0.97 | 43 | |||||||||||||||||||||||||||||||||
| 2010 | 7.28 | 0.10 | 0.40 | (0.10 | ) | — | 7.68 | 6.85 | 94,725 | 0.96 | 1.29 | 0.97 | 26 | |||||||||||||||||||||||||||||||||||
| 2009 | 8.25 | 0.13 | (0.98 | ) | (0.12 | ) | — | 7.28 | (10.03 | ) | 81,308 | 0.96 | 2.11 | 0.97 | 18 | |||||||||||||||||||||||||||||||||
| 2008 | 11.21 | 0.16 | (2.48 | ) | (0.15 | ) | (0.49 | ) | 8.25 | (21.57 | ) | 88,361 | 0.95 | 1.64 | 0.96 | 36 | ||||||||||||||||||||||||||||||||
Large Cap Growth Equity Fund | ||||||||||||||||||||||||||||||||||||||||||||||||
| Class N (commenced operations on March 28, 2000) | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 7.35 | $ | 0.01 | $ | 2.21 | $ | (0.00 | )^ | $ | — | $ | 9.57 | 30.22 | % | $ | 11,536 | 1.24 | % | 0.07 | % | 1.25 | % | 37 | % | |||||||||||||||||||||||
| 2011 | 7.59 | (0.01 | ) | (0.23 | ) | (0.00 | )^ | — | 7.35 | (3.11 | ) | 9,303 | 1.24 | (0.10 | ) | 1.25 | 82 | |||||||||||||||||||||||||||||||
| 2010 | 7.00 | 0.02 | 0.59 | (0.02 | ) | — | 7.59 | 8.72 | 9,271 | 1.24 | 0.27 | 1.25 | 61 | |||||||||||||||||||||||||||||||||||
| 2009 | 7.31 | 0.03 | (0.31 | ) | (0.03 | ) | — | 7.00 | (3.77 | ) | 9,120 | 1.24 | 0.45 | 1.25 | 12 | |||||||||||||||||||||||||||||||||
| 2008 | 8.77 | 0.01 | (1.46 | ) | (0.01 | ) | — | 7.31 | (16.55 | ) | 11,341 | 1.23 | 0.11 | 1.24 | 26 | |||||||||||||||||||||||||||||||||
| Servicing Class (commenced operations on January 14, 2000)^^ | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 7.44 | $ | 0.03 | $ | 2.23 | $ | (0.03 | ) | $ | — | $ | 9.67 | 30.43 | % | $ | 37,797 | 0.99 | % | 0.33 | % | 1.00 | % | 37 | % | |||||||||||||||||||||||
| 2011 | 7.67 | 0.01 | (0.23 | ) | (0.01 | ) | — | 7.44 | (2.86 | ) | 34,387 | 0.99 | 0.14 | 1.00 | 82 | |||||||||||||||||||||||||||||||||
| 2010 | 7.08 | 0.04 | 0.59 | (0.04 | ) | — | 7.67 | 8.89 | 31,317 | 0.99 | 0.52 | 1.00 | 61 | |||||||||||||||||||||||||||||||||||
| 2009 | 7.38 | 0.04 | (0.30 | ) | (0.04 | ) | — | 7.08 | (3.36 | ) | 28,050 | 0.99 | 0.70 | 1.00 | 12 | |||||||||||||||||||||||||||||||||
| 2008 | 8.86 | 0.03 | (1.48 | ) | (0.03 | ) | — | 7.38 | (16.40 | ) | 31,074 | 0.98 | 0.35 | 0.99 | 26 | |||||||||||||||||||||||||||||||||
Socially Responsible Equity Fund | ||||||||||||||||||||||||||||||||||||||||||||||||
| Institutional Class (commenced operations on January 3, 2005) | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 8.38 | $ | 0.13 | $ | 1.68 | $ | (0.13 | ) | $ | — | $ | 10.06 | 21.63 | % | $ | 80,109 | 0.90 | % | 1.37 | % | 0.90 | % | 38 | % | |||||||||||||||||||||||
| 2011 | 8.81 | 0.12 | (0.43 | ) | (0.12 | ) | — | 8.38 | (3.67 | ) | 62,193 | 0.88 | 1.27 | 0.89 | 22 | |||||||||||||||||||||||||||||||||
| 2010 | 8.20 | 0.09 | 0.61 | (0.09 | )* | — | 8.81 | 8.51 | 59,746 | 0.95 | 1.01 | 0.96 | 36 | |||||||||||||||||||||||||||||||||||
| 2009 | 9.51 | 0.12 | (1.30 | ) | (0.13 | ) | — | 8.20 | (12.11 | ) | 52,406 | 0.97 | 1.74 | 0.98 | 48 | |||||||||||||||||||||||||||||||||
| 2008 | 12.12 | 0.16 | (2.04 | ) | (0.15 | ) | (0.58 | ) | 9.51 | (16.24 | ) | 53,256 | 0.99 | 1.51 | 0.90 | 41 | ||||||||||||||||||||||||||||||||
| Class N (commenced operations on August 12, 2005) | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2012 | $ | 8.37 | $ | 0.11 | $ | 1.67 | $ | (0.11 | ) | $ | — | $ | 10.04 | 21.28 | % | $ | 25,631 | 1.15 | % | 1.13 | % | 1.40 | % | 38 | % | |||||||||||||||||||||||
| 2011 | 8.79 | 0.10 | (0.42 | ) | (0.10 | ) | — | 8.37 | (3.80 | ) | 3,132 | 1.13 | 1.05 | 1.39 | 22 | |||||||||||||||||||||||||||||||||
| 2010 | 8.19 | 0.07 | 0.60 | (0.07 | ) | — | 8.79 | 8.15 | 2,424 | 1.20 | 0.81 | 1.46 | 36 | |||||||||||||||||||||||||||||||||||
| 2009 | 9.50 | 0.11 | (1.31 | ) | (0.11 | ) | — | 8.19 | (12.34 | ) | 1,101 | 1.22 | 1.49 | 1.48 | 48 | |||||||||||||||||||||||||||||||||
| 2008 | 12.11 | 0.14 | (2.05 | ) | (0.12 | ) | (0.58 | ) | 9.50 | (16.46 | ) | 885 | 1.24 | 1.26 | 1.15 | 41 | ||||||||||||||||||||||||||||||||
| † | Per share calculations are based on Average Shares outstanding throughout the period. |
| ‡ | Returns are for the period indicated and have not been annualized. Fee waivers are in effect; if they had not been in effect, performance would have been lower. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. |
| * | Includes return of capital less than $0.01 per share. |
| ^ | Amount represents less than $0.01 per share. |
| ^^ | Effective December 19, 2011, Institutional Class Shares were redesignated as Servicing Class Shares. This share class name change had no impact on the Fund’s operations or investment policy. |
| (1) | Annualized for periods less than one year. |
| (2) | Ratio includes waivers and previously waived investment advisory fees recovered. The impact of the recovered fees may cause a higher net expense ratio. |
| Amounts designated as “—” are either $0 or have been rounded to $0. |
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 99
| notes to financial statements |
September 30, 2012 |
| 1. | ORGANIZATION: |
CNI Charter Funds, a Delaware statutory trust (the “Trust”), is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company currently offering the following 14 series (each a “Fund” and collectively, the “Funds”): Government Money Market Fund, Prime Money Market Fund, California Tax Exempt Money Market Fund (collectively, the “Money Market Funds”); Limited Maturity Fixed Income Fund, Government Bond Fund, Corporate Bond Fund, California Tax Exempt Bond Fund, Full Maturity Fixed Income Fund, High Yield Bond Fund (collectively, the “Fixed Income Funds”); Multi-Asset Fund; and Diversified Equity Fund, Large Cap Value Equity Fund, Large Cap Growth Equity Fund and Socially Responsible Equity Fund (collectively, the “Equity Funds”). The Money Market Funds are registered to offer Institutional, Servicing, Class N and Class S Shares. The Fixed Income Funds, Equity Funds and Multi-Asset Fund offer Institutional, Class N and/or Servicing Class Shares.
City National Asset Management, Inc. (“CNAM”) serves as the investment manager of the Funds.
Effective December 19, 2011 Institutional Class was redesignated Servicing Class for the Government Bond Fund, Corporate Bond Fund, California Tax Exempt Bond Fund, High Yield Bond Fund, Multi-Asset Fund, Large Cap Value Equity Fund and Large Cap Growth Equity Fund. During the year, the Government Bond Fund, High Yield Bond Fund, Large Cap Value Equity Fund and Multi-Asset Fund opened new Institutional Classes.
The assets of each Fund are segregated, and a shareholder’s interest is limited to the Fund in which shares are held. Each Fund is diversified with the exception of the California Tax Exempt Bond Fund, which is non-diversified. The Funds’ prospectus provides descriptions of each Fund’s investment objectives, policies and strategies.
| 2. | SIGNIFICANT ACCOUNTING POLICIES: |
The following is a summary of significant accounting policies followed by the Funds.
Use of Estimates – The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.
Security Valuation – Securities listed on a securities exchange, market or automated quotation system for which quotations are readily available (except for securities traded on NASDAQ) are valued at the last quoted sale price on the primary exchange or market (foreign or domestic) on which they are traded, or, if there is no such reported sale, at the most recent quoted bid price. For securities traded on NASDAQ, the NASDAQ Official Closing Price is used. If available, debt securities are priced based upon valuations provided by independent, third-party pricing agents. Such values generally reflect the last reported sales price if the security is actively traded. The third-party pricing agents may also value debt securities at an evaluated bid price by employing methodologies that utilize actual market transactions, broker-supplied valuations, or other methodologies designed to identify the market value for such securities. Debt obligations with remaining maturities of 60 days or less may be valued at their amortized cost, which approximates market value. The prices for foreign securities are reported in local currency and converted to U.S. dollars using currency exchange rates. Investments in registered open-end investment companies are priced at their daily net asset values. Prices for most securities held in the Funds are provided daily by recognized independent pricing agents. If a security price cannot be obtained from an independent, third-party pricing agent, the Funds seek to obtain a bid price from at least one independent broker.
Securities for which market prices are not “readily available” are valued in accordance with Fair Value Procedures established by the Trust’s Board of Trustees. The Funds’ Fair Value Procedures are implemented through a Fair Value Committee (the “Committee”) designated by the Trust’s Board of Trustees. Some of the more common reasons that may necessitate that a security be valued using Fair Value Procedures include: the security’s trading has been halted or suspended; the security has been de-listed from a national exchange; the security’s primary trading market is temporarily closed at a time when under normal conditions it would be open; for international securities, market events occur after the close of the foreign markets that make closing prices not representative of fair value; or the security’s primary pricing source is not able or willing to provide a price. When a security is valued in accordance with the Fair Value Procedures, the Committee will determine the value after taking into consideration relevant information reasonably available to the Committee.
In accordance with GAAP, the objective of a fair value measurement is to determine the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit
CNI CHARTER FUNDS | PAGE 100
price). The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below:
| • | Level 1 — Unadjusted quoted prices in active markets for identical, unrestricted assets or liabilities that the Funds have the ability to access at the measurement date; |
| • | Level 2 — Quoted prices in inactive markets, or inputs that are observable (either directly or indirectly) for substantially the full term of the asset or liability; and |
| • | Level 3 — Prices, inputs or exotic modeling techniques which are both significant to the fair value measurement and unobservable (supported by little or no market activity). |
Investments are classified within the level of the lowest significant input considered in determining fair value. Investments classified within Level 3 whose fair value measurement considers several inputs may include Level 1 or Level 2 inputs as components of the overall fair value measurement.
In May 2011, the FASB issued ASU No. 2011-04, “Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS.” ASU No. 2011-04 clarifies the application of existing fair value measurement and disclosure requirements, changes certain principles related to measuring fair value, and requires additional disclosures about fair value measurements. ASU No. 2011-04 is effective for periods beginning after December 15, 2011. ASU No. 2011-04 does not materially affect the Funds’ financial condition or results of operations.
For the year ended September 30, 2012, there have been no changes to the Funds’ fair valuation methodologies. For more details of the investment classification, reference the Schedules of Investments.
Security Transactions and Related Income – Security transactions are accounted for on the trade date of the security purchase or sale. Costs used in determining net realized capital gains and losses on the sale of securities are those of the specific securities sold. Interest income is recognized on an accrual basis and dividend income is recognized on the ex-dividend date. Purchase discounts and premiums on securities held by the Funds are accreted and amortized to maturity using the scientific method, which approximates the effective interest method over the holding period of a security, except for the Money Market Funds, which use a straight line basis which is not materially different from the scientific method.
Repurchase Agreements – Securities pledged as collateral for repurchase agreements are held by each Fund’s custodian bank, U.S. Bank, N.A., until maturity of the repurchase agreements. Provisions of the agreements and procedures adopted by the investment adviser require that the market value of the collateral, including accrued interest thereon, is sufficient in the event of default by the counterparty. The Funds also invest in tri-party repurchase agreements. Securities held as collateral for tri-party repurchase agreements are maintained by the broker’s custodian bank in a segregated account until maturity of the repurchase agreement. Provisions of the agreements require that the market value of the collateral, including accrued interest thereon, is sufficient in the event of default. If the counterparty defaults and the value of the collateral declines or if the counterparty enters into an insolvency proceeding, realization of the collateral by the Fund may be delayed or limited.
TBA Transactions – The Funds may engage in “to be announced” (“TBA”) security transactions. Such transactions involve a commitment by a Fund to purchase or sell securities for a predetermined price or yield, with payment and delivery taking place beyond the customary settlement period. The Funds record TBA securities on the trade date and maintain security positions such that sufficient liquid assets will be available to make payments for the securities purchased.
Expense Allocation – Common expenses incurred by the Funds are allocated among the Funds (i) based upon relative average daily net assets, (ii) as incurred on a specific identification basis, or (iii) equally among the Funds, depending on the nature of the expenditure.
Classes – Class-specific expenses are borne by that class. Income, non class-specific expenses, and realized and unrealized gains/losses are allocated to the respective class on the basis of relative net asset value each day.
Dividends and Distributions to Shareholders – Dividends from net investment income are declared daily and paid to shareholders monthly for the Money Market Funds and Fixed Income Funds. Dividends from net investment income are declared and paid quarterly for the Multi-Asset Fund and Equity Funds. Distributions from net realized capital gains are distributed to shareholders at least annually.
CNI CHARTER FUNDS | PAGE 101
| notes to financial statements |
September 30, 2012 |
| 3. | ADMINISTRATION, TRANSFER AGENT, DISTRIBUTION AND SHAREHOLDER SERVICES AGREEMENTS: |
Pursuant to an administration agreement dated April 1, 1999, as amended April 1, 2008, January 1, 2009, January 1, 2010, January 1, 2011 and January 1, 2012 (the “Agreement”), SEI Investments Global Funds Services (the “Administrator”), a wholly owned subsidiary of SEI Investments Company, acts as the Trust’s administrator. Under the terms of the Agreement, the Administrator is entitled to receive an annual fee of 0.065% of aggregate average daily net assets of the Trust not exceeding $2.5 billion, 0.045% of aggregate average daily net assets of the Trust exceeding $2.5 billion but not exceeding $5 billion, 0.025% of aggregate average daily net assets of the Trust exceeding $5 billion but not exceeding $7.5 billion, and 0.02% of aggregate average daily net assets of the Trust exceeding $7.5 billion. Each Fund is subject to a minimum annual fee of $90,000, which may be reduced at the sole discretion of the Administrator.
The Trust has adopted a Rule 12b-1 Distribution Plan (“the Plan”) with respect to Class N and Class S Shares that allows each Fund to pay distribution and servicing fees. Pursuant to the Plan, SEI Investments Distribution Co. (the “Distributor”) receives a distribution fee, computed daily and paid monthly, at the annual rate of 0.50% of the average daily net assets of the Class N Shares and Class S Shares of the Money Market Funds and 0.25% of the Class N Shares of the Fixed Income Funds, Multi-Asset Fund and Equity Funds, with the exception of 0.30% charged to the Class N Shares of the High Yield Bond Fund, which may be used by the Distributor to provide compensation for sales support and distribution-related activities.
SEI Institutional Transfer Agency, a division of SEI Investments Management Corporation (the “Transfer Agent”), serves as transfer agent for the Trust and provides services at an annual rate of $15,000 per share class for all funds other than Limited Maturity Fixed Income Fund, Full Maturity Fixed Income Fund, Diversified Equity Fund and Socially Responsible Equity Fund. The Transfer Agent has agreed to waive these fees.
UMB Fund Services serves as sub-transfer agent for all share classes of the Limited Maturity Fixed Income Fund, Full Maturity Fixed Income Fund, Diversified Equity Fund and Socially Responsible Equity Fund, and provides services at an annual rate of $14,000 per share class plus other transaction based fees and out of pocket expenses.
The Trust has entered into Shareholder Servicing Agreements that permit payment of compensation to City National Bank (“CNB”) and its affiliates (including CNAM) which provide certain shareholder support for their customers who own Institutional Class (for the Money Market Funds only), Class N, Class S or Servicing Class Shares. In consideration for such services, a shareholder servicing fee is charged at the annual rate of up to 0.25% of average daily net assets of the relevant class of each Fund. CNB and CNAM have both agreed to voluntarily waive portions of their shareholder servicing fees with respect to certain Funds. For the year ended September 30, 2012, CNB and CNAM received Shareholder Servicing fees from the Trust in the amounts of $837,858 and $0, respectively.
Certain officers of the Trust are also officers of CNAM or the Administrator. Such officers are paid no fees by the Trust for serving as officers of the Trust.
| 4. | INVESTMENT ADVISORY FEES AND OTHER AGREEMENTS: |
Under the terms of the current investment management agreements, CNAM receives an annual fee equal to a percentage of the average daily net assets of the Funds, as follows:
Fund | Fee |
| Government Money Market Fund | 0.26% |
| Prime Money Market Fund | 0.25 |
| California Tax Exempt Money Market Fund | 0.27 |
| Limited Maturity Fixed Income Fund | 0.50 |
| Government Bond Fund | 0.43 |
| Corporate Bond Fund | 0.40 |
| California Tax Exempt Bond Fund | 0.27 |
| Full Maturity Fixed Income Fund | 0.50 |
| High Yield Bond Fund | 0.75 |
| Multi-Asset Fund | 0.50 |
| Diversified Equity Fund | 0.75* |
| Large Cap Value Equity Fund | 0.62 |
| Large Cap Growth Equity Fund | 0.65 |
| Socially Responsible Equity Fund | 0.75 |
| * | CNAM has contractually agreed to waive a portion of the annual management fee payable to it by the Diversified Equity Fund, thereby reducing the annual management fee from 0.75% of average daily net assets to 0.65% of average daily net assets. This limitation will be in effect until January 28, 2013. |
Robert W. Baird & Co., Incorporated and Boyd Watterson Asset Management, LLC act as the investment sub-advisers with respect to the Full Maturity Fixed Income Fund.
Guggenheim Partners Investment Management, LLC acts as the investment sub-adviser with respect to the High Yield Bond Fund.
CNI CHARTER FUNDS | PAGE 102
SKBA Capital Management, LLC and Turner Investments, L.P. act as the investment sub-advisers with respect to the Diversified Equity Fund.
SKBA Capital Management, LLC acts as the investment sub-adviser with respect to the Socially Responsible Equity Fund.
Sub-adviser fees are paid by CNAM.
CNAM has agreed to limit its fees or reimburse expenses to the extent necessary to keep operating expenses at or below certain percentages of certain of the Funds’ respective average daily net assets. For the Limited Maturity Fixed Income Fund, Full Maturity Fixed Income Fund, Diversified Equity Fund and Socially Responsible Equity Fund the expense limitations are contractual and for the other Funds they are voluntary. The expense limitations (expressed as percentages of average daily net assets) are as follows:
Government Money Market Fund | Prime Money Market Fund | California Tax Exempt Money Market Fund | ||
| Institutional Class | 0.63% | 0.63% | 0.55% | |
| Class N | 0.85% | 0.85% | 0.78% | |
| Class S | 1.05% | 1.05% | 0.98% |
Limited Maturity Fixed Income Fund | Government Bond Fund | Corporate Bond Fund | California Tax Exempt Bond Fund | |
| Institutional Class | 1.00% | 0.55% | n/a | n/a |
| Class N | 1.25% | 1.05% | 1.05% | 0.85% |
| Servicing Class | n/a | 0.80% | 0.80% | 0.60% |
Full Maturity Fixed Income Fund | High Yield Bond Fund | Multi-Asset Fund | Diversified Equity Fund | |
| Institutional Class | 1.00% | 0.85% | 1.25% | 1.25% |
| Class N | 1.25% | 1.40% | 1.75% | 1.50% |
| Servicing Class | n/a | 1.10% | 1.50% | n/a |
Large Cap Value Equity Fund | Large Cap Growth Equity Fund | Socially Responsible Equity Fund | ||
| Institutional Class | 0.75% | n/a | 1.25% | |
| Class N | 1.25% | 1.30% | 1.50% | |
| Servicing Class | 1.00% | 1.05% | n/a |
Any fee reductions or expense reimbursements may be repaid by a Fund to CNAM, as applicable, within three years after occurrence, subject to certain restrictions and only if such repayments do not cause the Fund’s expense ratios, at the time of repayment, to exceed the applicable amount shown in the preceding table.
As of September 30, 2012, fees which were previously waived by CNAM which may be subject to possible future reimbursement were as follows:
Fund | Potential Amount of Recovery (000) | Expiration | ||||||
| Government Money Market Fund | $ | 5,102 | 2013 | |||||
| 6,470 | 2014 | |||||||
| 6,662 | 2015 | |||||||
| Prime Money Market Fund | 1,372 | 2013 | ||||||
| 1,533 | 2014 | |||||||
| 1,222 | 2015 | |||||||
| California Tax Exempt Money Market Fund | 1,560 | 2013 | ||||||
| 1,775 | 2014 | |||||||
| 2,066 | 2015 | |||||||
| Government Bond Fund | 101 | 2013 | ||||||
| 122 | 2014 | |||||||
| 25 | 2015 | |||||||
| California Tax Exempt Bond Fund | 46 | 2013 | ||||||
| 56 | 2014 | |||||||
| 17 | 2015 | |||||||
| High Yield Bond Fund | 43 | 2013 | ||||||
| 67 | 2014 | |||||||
| 17 | 2015 | |||||||
CNI CHARTER FUNDS | PAGE 103
| notes to financial statements |
September 30, 2012 |
CNAM, CNB and the Administrator have voluntarily agreed to further waive and reduce their fees and/or reimburse certain expenses of the Money Market Funds in order to maintain a one-day net income yield (yield floor) of each Fund of not less than 0.01% of the Fund’s average daily net assets. The following table shows waivers, with respect to such yield floor, by class for the year ended September 30, 2012:
Shareholder Servicing Fee Waiver (000) | Investment Advisory Fee Waiver (000) | Administration Fee Waiver (000) | ||||||||||
| Government Money Market Fund | ||||||||||||
| Institutional | $ | 262 | $ | 213 | $ | 11 | ||||||
| Class N | 14,256 | (1) | 5,848 | 288 | ||||||||
Class S | 2,080 | (1) | 601 | 30 | ||||||||
| Prime Money Market Fund | ||||||||||||
| Institutional | 1,373 | 544 | 55 | |||||||||
| Class N | 1,953 | (1) | 402 | 40 | ||||||||
Class S | 1,897 | (1) | 276 | 28 | ||||||||
| California Tax Exempt Money Market Fund | ||||||||||||
| Institutional | 380 | 258 | 15 | |||||||||
| Class N | 3,283 | (1) | 1,148 | 69 | ||||||||
Class S | 549 | (1) | 136 | 8 | ||||||||
| (1) | Includes class specific distribution expenses. |
| 5. | INVESTMENT TRANSACTIONS: |
The cost of security purchases and proceeds from the sale and maturities of securities, other than temporary investments in short-term securities for the year ended September 30, 2012, were as follows for the Fixed Income Funds, Multi-Asset Fund and Equity Funds:
Purchases | Sales and Maturities | |||||||||||||||
Fund | U.S. Gov’t (000) | Other (000) | U.S. Gov’t (000) | Other (000) | ||||||||||||
| Limited Maturity Fixed Income Fund | $ | 34,942 | $ | 14,620 | $ | 27,958 | $ | 7,153 | ||||||||
| Government Bond Fund | 91,383 | — | 84,594 | — | ||||||||||||
| Corporate Bond Fund | 3,153 | 51,109 | 263 | 35,229 | ||||||||||||
| California Tax Exempt Bond Fund | — | 16,696 | — | 15,243 | ||||||||||||
| Full Maturity Fixed Income Fund | 21,115 | 9,816 | 20,486 | 9,994 | ||||||||||||
| High Yield Bond Fund | — | 90,612 | — | 47,444 | ||||||||||||
| Multi-Asset Fund | — | 44,289 | * | — | 37,340 | * | ||||||||||
| Diversified Equity Fund | — | 34,238 | — | 54,720 | ||||||||||||
| Large Cap Value Equity Fund | — | 33,374 | — | 39,491 | ||||||||||||
| Large Cap Growth Equity Fund | — | 16,864 | — | 24,222 | ||||||||||||
| Socially Responsible Equity Fund | — | 58,406 | — | 32,760 | ||||||||||||
| * | Includes $6,825(000) and $3,479(000) of purchases and sales, respectively, of affiliated registered investment companies. |
| 6. | FEDERAL TAX INFORMATION: |
It is each Fund’s intention to continue to qualify as a regulated investment company for Federal income tax purposes and distribute all of its taxable income and net capital gains. Accordingly, no provisions for Federal income taxes are required.
Management has analyzed the Funds’ tax position taken on federal income tax returns for all open tax years and has concluded that as of September 30, 2012, no provision for income tax would be required in the Funds’ financial statements. The Funds’ federal and state income and federal excise tax returns for tax years for which the applicable statutes of limitations have not expired are subject to examination by the Internal Revenue Service and state departments of revenue.
The Funds may be subject to taxes imposed by countries in which they invest, with respect to their investments in issuers existing or operating in such countries. Such taxes are generally based on income earned. The Funds accrue such taxes when the related income is earned.
CNI CHARTER FUNDS | PAGE 104
The timing and characterization of certain income and capital gains distributions are determined annually in accordance with Federal tax regulations, which may differ from accounting principles generally accepted in the United States of America. As a result, net investment income (loss) and net realized gain (loss) on investment transactions for a reporting period may differ significantly from distributions during such period. These book/tax differences may be temporary or permanent. To the extent these differences are permanent in nature, they are charged or credited to undistributed net investment income (loss), accumulated net realized gain (loss), or paid-in capital, as appropriate, in the period that the differences arise.
Accordingly, the following permanent differences, primarily attributable to REIT adjustments, realized gains (losses) on paydowns and timing of distributions, were reclassified to/from the following accounts as of September 30, 2012:
Fund | Increase (Decrease) Undistributed Net Investment Income (Loss) (000) | Increase (Decrease) Accumulated Net Realized Gain (Loss) (000) | ||||||
| Limited Maturity Fixed Income Fund | $ | 24 | $ | (24 | ) | |||
| Government Bond Fund | 927 | (927 | ) | |||||
| Corporate Bond Fund | 7 | (7 | ) | |||||
| Full Maturity Fixed Income Fund | 62 | (62 | ) | |||||
| High Yield Bond Fund | (5 | ) | 5 | |||||
| Multi-Asset Fund | 39 | (39 | ) | |||||
The tax character of dividends and distributions declared during the years ended September 30, 2012 and September 30, 2011 were as follows:
Fund | Tax Exempt Income (000) | Ordinary Income (000) | Long-Term Capital Gain (000) | Return of Capital (000) | Total (000) | |||||||||||||||
| Government Money Market Fund | ||||||||||||||||||||
| 2012 | $ | — | $ | 333 | $ | — | $ | — | $ | 333 | ||||||||||
| 2011 | — | 509 | — | — | 509 | |||||||||||||||
| Prime Money Market Fund | ||||||||||||||||||||
| 2012 | $ | — | $ | 209 | $ | — | $ | — | $ | 209 | ||||||||||
| 2011 | — | 533 | — | — | 533 | |||||||||||||||
| California Tax Exempt Money Market Fund | ||||||||||||||||||||
| 2012 | $ | 90 | $ | 1 | $ | — | $ | — | $ | 91 | ||||||||||
| 2011 | 163 | 1 | — | — | 164 | |||||||||||||||
| Limited Maturity Fixed Income Fund | ||||||||||||||||||||
| 2012 | $ | — | $ | 389 | $ | — | $ | — | $ | 389 | ||||||||||
| 2011 | — | 579 | — | — | 579 | |||||||||||||||
| Government Bond Fund | ||||||||||||||||||||
| 2012 | $ | — | $ | 2,432 | $ | 143 | $ | — | $ | 2,575 | ||||||||||
| 2011 | — | 3,356 | — | — | 3,356 | |||||||||||||||
| Corporate Bond Fund | ||||||||||||||||||||
| 2012 | $ | — | $ | 2,795 | $ | 538 | $ | — | $ | 3,333 | ||||||||||
| 2011 | — | 3,390 | — | — | 3,390 | |||||||||||||||
| California Tax Exempt Bond Fund | ||||||||||||||||||||
| 2012 | $ | 1,360 | $ | 63 | $ | 332 | $ | — | $ | 1,755 | ||||||||||
| 2011 | 1,360 | — | 187 | — | 1,547 | |||||||||||||||
| Full Maturity Fixed Income Fund | ||||||||||||||||||||
| 2012 | $ | — | $ | 1,125 | $ | 530 | $ | — | $ | 1,655 | ||||||||||
| 2011 | — | 1,427 | 110 | — | 1,537 | |||||||||||||||
| High Yield Bond Fund | ||||||||||||||||||||
| 2012 | $ | — | $ | 9,684 | $ | — | $ | — | $ | 9,684 | ||||||||||
| 2011 | — | 6,045 | — | — | 6,045 | |||||||||||||||
| Multi-Asset Fund | ||||||||||||||||||||
| 2012 | $ | — | $ | 899 | $ | — | $ | — | $ | 899 | ||||||||||
| 2011 | — | 662 | — | — | 662 | |||||||||||||||
| Diversified Equity Fund | ||||||||||||||||||||
| 2012 | $ | — | $ | 283 | $ | — | $ | — | $ | 283 | ||||||||||
| 2011 | — | 231 | — | — | 231 | |||||||||||||||
| Large Cap Value Equity Fund | ||||||||||||||||||||
| 2012 | $ | — | $ | 1,808 | $ | — | $ | — | $ | 1,808 | ||||||||||
| 2011 | — | 1,478 | — | — | 1,478 | |||||||||||||||
| Large Cap Growth Equity Fund | ||||||||||||||||||||
| 2012 | $ | — | $ | 124 | $ | — | $ | — | $ | 124 | ||||||||||
| 2011 | — | 62 | — | — | 62 | |||||||||||||||
| Socially Responsible Equity Fund | ||||||||||||||||||||
| 2012 | $ | — | $ | 1,199 | $ | — | $ | — | $ | 1,199 | ||||||||||
| 2011 | — | 902 | — | — | 902 | |||||||||||||||
CNI CHARTER FUNDS | PAGE 105
| notes to financial statements |
September 30, 2012 |
As of September 30, 2012, the components of Distributable Earnings/(Accumulated Losses) on a tax basis were as follows:
Fund | Undistributed Tax-Exempt Income (000) | Undistributed Ordinary Income (000) | Undistributed Long-Term Capital Gain (000) | Capital Loss Carryforwards (000) | Post-October Losses (000) | Unrealized Appreciation (000) | Other Temporary Differences (000) | Total Distributable Earnings (Accumulated Losses) (000) | ||||||||||||||||||||||||
| Government Money Market Fund | $ | — | $ | 27 | $ | — | $ | (6 | ) | $ | (1 | ) | $ | — | $ | (27 | ) | $ | (7 | ) | ||||||||||||
| Prime Money Market Fund | — | 21 | — | (12 | ) | (2 | ) | — | (21 | ) | (14 | ) | ||||||||||||||||||||
| California Tax Exempt Money Market Fund | 8 | — | — | — | — | — | (6 | ) | 2 | |||||||||||||||||||||||
| Limited Maturity Fixed Income Fund | — | 27 | — | (2,140 | ) | (10 | ) | 623 | (27 | ) | (1,527 | ) | ||||||||||||||||||||
| Government Bond Fund | — | 193 | — | (73 | ) | (834 | ) | 4,718 | (193 | ) | 3,811 | |||||||||||||||||||||
| Corporate Bond Fund | — | 255 | 1,038 | — | — | 5,095 | (216 | ) | 6,172 | |||||||||||||||||||||||
| California Tax Exempt Bond Fund | 105 | 150 | 278 | — | — | 2,336 | (105 | ) | 2,764 | |||||||||||||||||||||||
| Full Maturity Fixed Income Fund | — | 393 | 644 | — | — | 2,347 | (81 | ) | 3,303 | |||||||||||||||||||||||
| High Yield Bond Fund | — | 981 | — | (504 | ) | — | 3,397 | (958 | ) | 2,916 | ||||||||||||||||||||||
| Multi-Asset Fund | — | 222 | — | (2,359 | ) | (1,296 | ) | 1,879 | (204 | ) | (1,758 | ) | ||||||||||||||||||||
| Diversified Equity Fund | — | 75 | — | (16,563 | ) | — | 4,035 | (75 | ) | (12,528 | ) | |||||||||||||||||||||
| Large Cap Value Equity Fund | — | 420 | 957 | — | (500 | ) | 11,070 | (420 | ) | 11,527 | ||||||||||||||||||||||
| Large Cap Growth Equity Fund | — | 18 | 256 | — | — | 9,517 | (18 | ) | 9,773 | |||||||||||||||||||||||
| Socially Responsible Equity Fund | — | 281 | — | (10,257 | ) | (138 | ) | 12,592 | (281 | ) | 2,197 | |||||||||||||||||||||
For tax purposes, the losses in the Funds can be carried forward for a maximum of eight years to offset any future net realized capital gains. As of September 30, 2012, the breakdown of capital loss carryforwards was as follows:
Expiring September 30, | ||||||||||||||||||||||||||||||||
Fund | 2013 (000) | 2014 (000) | 2015 (000) | 2016 (000) | 2017 (000) | 2018 (000) | 2019 (000) | Total (000) | ||||||||||||||||||||||||
| Government Money Market Fund | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 5 | $ | 5 | ||||||||||||||||
| Limited Maturity Fixed Income Fund | 185 | 132 | 1,415 | — | 81 | 327 | — | 2,140 | ||||||||||||||||||||||||
| High Yield Bond Fund | — | — | — | — | — | 504 | — | 504 | ||||||||||||||||||||||||
| Multi-Asset Fund | — | — | — | — | 686 | 1,328 | — | 2,014 | ||||||||||||||||||||||||
| Diversified Equity Fund | — | — | — | — | 3,230 | 13,333 | — | 16,563 | ||||||||||||||||||||||||
| Socially Responsible Equity Fund | — | — | — | — | 1,402 | 7,193 | 1,662 | 10,257 | ||||||||||||||||||||||||
Under the Regulated Investment Company Modernization Act of 2010, the Funds will be permitted to carry forward capital losses incurred in taxable years beginning after December 22, 2010 for an unlimited period. However, any losses incurred during those future taxable years will be required to be utilized prior to the losses incurred in pre-enactment taxable years. As a result of this ordering rule, pre-enactment capital loss carryforwards may be more likely to expire unused. Additionally, post-enactment capital losses that are carried forward will retain their character as either short-term or long-term capital losses rather than being considered all short-term as under previous law. Losses carried forward under these new provisions are as follows:
Fund | Short-Term Loss (000) | Long-Term Loss (000) | Total (000)* | |||||||||
| Government Money Market Fund | $ | 1 | $ | — | $ | 1 | ||||||
| Prime Money Market Fund | 12 | — | 12 | |||||||||
| Government Bond Fund | 28 | 45 | 73 | |||||||||
| Multi-Asset Fund | 345 | — | 345 | |||||||||
| * | This table should be used in conjunction with the capital loss carryforwards table. |
CNI CHARTER FUNDS | PAGE 106
During the year ended September 30, 2012, the following Funds utilized capital loss carryforwards to offset capital gains amounting to:
Fund | Amount (000) | |||
| Limited Maturity Fixed Income Fund | $ | 317 | ||
| High Yield Bond Fund | 1,494 | |||
| Diversified Equity Fund | 2,860 | |||
| Large Cap Value Equity Fund | 3,824 | |||
| Large Cap Growth Equity Fund | 1,195 | |||
Socially Responsible Equity Fund | 840 | |||
Post-October losses represent losses realized on investments and foreign currency transactions from November 1, 2010, through September 30, 2012, that, in accordance with Federal income tax regulations, the Funds have elected to defer and treat as having arisen in the following fiscal year.
The aggregate gross unrealized appreciation on securities, the aggregate gross unrealized depreciation on securities and the net unrealized appreciation/ (depreciation) for tax purposes at September 30, 2012, for each of the Fixed Income Funds, Equity Funds and Multi-Asset Fund were as follows:
Fund | Federal Tax Cost (000) | Aggregate Gross Unrealized Appreciation (000) | Aggregate Gross Unrealized Depreciation (000) | Net Unrealized Appreciation (Depreciation) (000) | ||||||||||||
| Limited Maturity Fixed Income Fund | $ | 54,873 | $ | 659 | $ | (36 | ) | $ | 623 | |||||||
| Government Bond Fund | 184,508 | 4,829 | (111 | ) | 4,718 | |||||||||||
| Corporate Bond Fund | 129,663 | 5,127 | (32 | ) | 5,095 | |||||||||||
| California Tax Exempt Bond Fund | 56,501 | 2,365 | (29 | ) | 2,336 | |||||||||||
| Full Maturity Fixed Income Fund | 44,682 | 2,382 | (35 | ) | 2,347 | |||||||||||
| High Yield Bond Fund | 147,021 | 7,095 | (3,697 | ) | 3,398 | |||||||||||
| Multi-Asset Fund | 42,761 | 1,924 | (45 | ) | 1,879 | |||||||||||
| Diversified Equity Fund | 42,559 | 5,759 | (1,724 | ) | 4,035 | |||||||||||
| Large Cap Value Equity Fund | 113,504 | 16,761 | (5,691 | ) | 11,070 | |||||||||||
| Large Cap Growth Equity Fund | 39,712 | 10,751 | (1,234 | ) | 9,517 | |||||||||||
| Socially Responsible Equity Fund | 93,626 | 14,797 | (2,205 | ) | 12,592 | |||||||||||
At September 30, 2012, the Money Market Funds’ cost of securities for Federal income tax purposes approximates the cost disclosed in the Schedule of Investments.
| 7. | CONCENTRATION OF CREDIT RISK |
In the normal course of business, the Funds enter into contracts that provide general indemnifications. The Funds’ maximum exposure under these arrangements is dependent on future claims that may be made against the Funds and, therefore, cannot be established; however, based on experience, the risk of loss from such claims is considered remote.
The Multi-Asset Fund may invest in exchange-traded notes (“ETNs”) as a non-principal investment strategy. ETNs are unsecured debt obligations of investment banks which are traded on exchanges and the returns of which are linked to the performance of market indexes. In addition to trading ETNs on exchanges, investors may redeem ETNs directly with the issuer on a weekly basis, typically in a minimum amount of 50,000 units, or hold the ETNs until maturity. ETNs are riskier than ordinary unsecured debt securities and have no principal protection. The Fund will generally invest in ETNs which are linked to commodities indexes. The Fund’s investment in an ETN may be influenced by many unpredictable factors, including highly volatile commodities prices, changes in supply and demand relationships, weather, agriculture, trade, changes in interest rates, and monetary and other governmental policies, action and inaction. Investing in ETNs is not equivalent to investing directly in index components or the relevant index itself. Because ETNs are debt securities, they possess credit risk; if the issuer has financial difficulties or goes bankrupt, the investor may not receive the return it was promised.
California Tax Exempt Funds – Specific Risks
The ability of issuers to pay interest on, and repay principal of, California municipal securities may be affected by economic and political developments in the State of California.
Certain securities are backed by letters of credit from various financial institutions and financial guaranty assurance agencies. These letters of credit enhance the credit quality of the individual securities; however, if any of the financial institutions or financial guaranty assurance agencies’ credit quality should deteriorate, it could cause the individual security’s credit quality to change. Additionally, if any of the Funds concentrate their letters of credit in any one financial institution, the risk of credit quality deterioration increases.
CNI CHARTER FUNDS | PAGE 107
| notes to financial statements |
September 30, 2012 |
| 8. | CAPITAL SHARES ISSUED AND REDEEMED: |
Capital share activity for the years ended September 30, were as follows:
Government Money Market Fund (000) | Prime Money Market Fund (000) | California Tax Exempt Money Market Fund (000) | ||||||||||||||||||||||
2012 | 2011 | 2012 | 2011 | 2012 | 2011 | |||||||||||||||||||
| CAPITAL SHARES ISSUED AND REDEEMED: | ||||||||||||||||||||||||
| Institutional Class: | ||||||||||||||||||||||||
| Shares issued | 779,564 | 468,707 | 3,258,448 | 2,567,876 | 1,079,873 | 1,057,959 | ||||||||||||||||||
| Shares issued in Lieu of Dividends and Distributions | — | — | 21 | 51 | — | — | ||||||||||||||||||
Shares redeemed | (734,817 | ) | (498,052 | ) | (3,381,990 | ) | (2,427,636 | ) | (1,112,139 | ) | (1,028,266 | ) | ||||||||||||
Net Institutional Class transactions | 44,747 | (29,345 | ) | (123,521 | ) | 140,291 | (32,266 | ) | 29,693 | |||||||||||||||
| Class N: | ||||||||||||||||||||||||
| Shares issued | 4,477,708 | 6,046,915 | 788,534 | 1,236,194 | 1,072,087 | 1,294,708 | ||||||||||||||||||
| Shares issued in Lieu of Dividends and Distributions | 237 | 374 | 37 | 93 | 66 | 117 | ||||||||||||||||||
Shares redeemed | (4,595,995 | ) | (5,719,187 | ) | (844,817 | ) | (1,218,312 | ) | (1,033,785 | ) | (1,305,501 | ) | ||||||||||||
Net Class N transactions | (118,050 | ) | 328,102 | (56,246 | ) | 17,975 | 38,368 | (10,676 | ) | |||||||||||||||
| Class S: | ||||||||||||||||||||||||
| Shares issued | 903,404 | 849,467 | 1,112,831 | 1,490,167 | 335,463 | 301,856 | ||||||||||||||||||
| Shares issued in Lieu of Dividends and Distributions | — | — | — | — | — | — | ||||||||||||||||||
Shares redeemed | (905,676 | ) | (906,968 | ) | (1,121,886 | ) | (1,577,615 | ) | (313,714 | ) | (271,899 | ) | ||||||||||||
Net Class S transactions | (2,272 | ) | (57,501 | ) | (9,055 | ) | (87,448 | ) | 21,749 | 29,957 | ||||||||||||||
Limited Maturity Fixed Income Fund (000) | Government Bond Fund (000)(1) | Corporate Bond Fund (000) | California Tax Exempt Bond Fund (000) | |||||||||||||||||||||||||||||
2012 | 2011 | 2012 | 2011 | 2012 | 2011 | 2012 | 2011 | |||||||||||||||||||||||||
| CAPITAL SHARES ISSUED AND REDEEMED: | ||||||||||||||||||||||||||||||||
| Institutional Class: | ||||||||||||||||||||||||||||||||
| Shares issued | 3,674 | 210 | 4,604 | — | — | — | — | — | ||||||||||||||||||||||||
| Shares issued in Lieu of Dividends and Distributions | 18 | 28 | 128 | — | — | — | — | — | ||||||||||||||||||||||||
Shares redeemed | (2,261 | ) | (358 | ) | (9,518 | ) | — | — | — | — | — | |||||||||||||||||||||
Net Institutional Class transactions | 1,431 | (120 | ) | (4,786 | ) | — | — | — | — | — | ||||||||||||||||||||||
| Class N: | ||||||||||||||||||||||||||||||||
| Shares issued | 91 | 763 | 38 | 50 | 42 | 100 | 317 | 145 | ||||||||||||||||||||||||
| Shares issued in Lieu of Dividends and Distributions | 4 | 5 | 2 | 3 | 4 | 3 | 9 | 6 | ||||||||||||||||||||||||
Shares redeemed | (283 | ) | (1,021 | ) | (36 | ) | (84 | ) | (48 | ) | (88 | ) | (191 | ) | (33 | ) | ||||||||||||||||
Net Class N transactions | (188 | ) | (253 | ) | 4 | (31 | ) | (2 | ) | 15 | 135 | 118 | ||||||||||||||||||||
| Servicing Class^: | ||||||||||||||||||||||||||||||||
| Shares issued | — | — | 5,526 | 5,375 | 5,654 | 3,825 | 1,643 | 2,513 | ||||||||||||||||||||||||
| Shares issued in Lieu of Dividends and Distributions | — | — | 38 | 227 | 100 | 99 | 66 | 66 | ||||||||||||||||||||||||
Shares redeemed | — | — | (391 | ) | (3,818 | ) | (4,022 | ) | (3,090 | ) | (1,931 | ) | (1,349 | ) | ||||||||||||||||||
Net Servicing Class transactions | — | — | 5,173 | 1,784 | 1,732 | 834 | (222 | ) | 1,230 | |||||||||||||||||||||||
| (1) | Institutional Class commenced operations on February 1, 2012. |
| ^ | Effective December 19, 2011, Institutional Class Shares were redesignated as Servicing Class Shares. This share class name change had no impact on the Fund’s operations or investment policy. |
CNI CHARTER FUNDS | PAGE 108
Full Maturity Fixed Income Fund (000) | High Yield Bond Fund (000)(1) | Multi-Asset Fund (000)(2) | Diversified Equity Fund (000) | |||||||||||||||||||||||||||||
2012 | 2011 | 2012 | 2011 | 2012 | 2011 | 2012 | 2011 | |||||||||||||||||||||||||
| CAPITAL SHARES ISSUED AND REDEEMED: | ||||||||||||||||||||||||||||||||
| Institutional Class: | ||||||||||||||||||||||||||||||||
| Shares issued | 270 | 103 | 5,055 | — | 1,451 | — | 26 | 271 | ||||||||||||||||||||||||
| Shares issued in Lieu of Dividends and Distributions | 125 | 113 | 140 | — | 19 | — | 18 | 11 | ||||||||||||||||||||||||
Shares redeemed | (207 | ) | (385 | ) | (461 | ) | — | (269 | ) | — | (1,606 | ) | (647 | ) | ||||||||||||||||||
Net Institutional Class transactions | 188 | (169 | ) | 4,734 | — | 1,201 | — | (1,562 | ) | (365 | ) | |||||||||||||||||||||
| Class N: | ||||||||||||||||||||||||||||||||
| Shares issued | 9 | 233 | 1,231 | 992 | 235 | 964 | 3 | 39 | ||||||||||||||||||||||||
| Shares issued in Lieu of Dividends and Distributions | 1 | 6 | 189 | 159 | 29 | 21 | 1 | — | ||||||||||||||||||||||||
Shares redeemed | (28 | ) | (544 | ) | (541 | ) | (446 | ) | (540 | ) | (439 | ) | (154 | ) | (168 | ) | ||||||||||||||||
Net Class N transactions | (18 | ) | (305 | ) | 879 | 705 | (276 | ) | 546 | (150 | ) | (129 | ) | |||||||||||||||||||
| Servicing Class^: | ||||||||||||||||||||||||||||||||
| Shares issued | — | — | 8,522 | 6,022 | 419 | 1,023 | — | — | ||||||||||||||||||||||||
| Shares issued in Lieu of Dividends and Distributions | — | — | 245 | 147 | 19 | 21 | — | — | ||||||||||||||||||||||||
Shares redeemed | — | — | (8,421 | ) | (1,989 | ) | (1,678 | ) | (198 | ) | — | — | ||||||||||||||||||||
Net Servicing Class transactions | — | — | 346 | 4,180 | (1,240 | ) | 846 | — | — | |||||||||||||||||||||||
Large Cap Value Equity Fund (000)(3) | Large Cap Growth Equity Fund (000) | Socially Responsible Equity Fund (000) | ||||||||||||||||||||||
2012 | 2011 | 2012 | 2011 | 2012 | 2011 | |||||||||||||||||||
| CAPITAL SHARES ISSUED AND REDEEMED: | ||||||||||||||||||||||||
| Institutional Class: | ||||||||||||||||||||||||
| Shares issued | 3,855 | — | — | — | 1,358 | 1,674 | ||||||||||||||||||
| Shares issued in Lieu of Dividends and Distributions | 45 | — | — | — | 102 | 91 | ||||||||||||||||||
Shares redeemed | (280 | ) | — | — | — | (917 | ) | (1,127 | ) | |||||||||||||||
Net Institutional Class transactions | 3,620 | — | — | — | 543 | 638 | ||||||||||||||||||
| Class N: | ||||||||||||||||||||||||
| Shares issued | 102 | 73 | 132 | 172 | 2,382 | 189 | ||||||||||||||||||
| Shares issued in Lieu of Dividends and Distributions | 10 | 9 | — | — | 21 | 4 | ||||||||||||||||||
Shares redeemed | (265 | ) | (172 | ) | (192 | ) | (128 | ) | (223 | ) | (95 | ) | ||||||||||||
Net Class N transactions | (153 | ) | (90 | ) | (60 | ) | 44 | 2,180 | 98 | |||||||||||||||
| Servicing Class^: | ||||||||||||||||||||||||
| Shares issued | 2,676 | 2,893 | 1,343 | 2,163 | — | — | ||||||||||||||||||
| Shares issued in Lieu of Dividends and Distributions | 103 | 124 | 5 | 3 | — | — | ||||||||||||||||||
Shares redeemed | (6,187 | ) | (3,161 | ) | (2,063 | ) | (1,627 | ) | — | — | ||||||||||||||
Net Servicing Class transactions | (3,408 | ) | (144 | ) | (715 | ) | 539 | — | — | |||||||||||||||
| (1) | Institutional Class commenced operations on February 2, 2012. |
| (2) | Institutional Class commenced operations on March 22, 2012. |
| (3) | Institutional Class commenced operations on February 1, 2012. |
| ^ | Effective December 19, 2011, Institutional Class Shares were redesignated as Servicing Class Shares. This share class name change had no impact on the Fund’s operations or investment policy. |
CNI CHARTER FUNDS | PAGE 109
| notes to financial statements |
September 30, 2012 |
| 9. | SUBSEQUENT EVENTS |
The Trust has evaluated the need for additional disclosures and/or adjustments resulting from subsequent events. Based on this evaluation, no adjustments were required to the financial statements as of September 30, 2012 and no issues were noted to disclose, except as follows:
At a special meeting held November 7, 2012, the Board of Trustees of CNI Charter Funds decided to close the Large Cap Value Equity Fund and the Large Cap Growth Equity Fund on or about January 3, 2013. In connection with the closing of the Funds, the Board of Trustees has directed City National Asset Management, Inc., the Funds’ investment adviser, to liquidate the Funds’ portfolio holdings in an orderly manner and to invest the proceeds in money market and other short-term instruments.
The Trust has filed an amendment to the registration statement with the Securities and Exchange Commission to create an Institutional Share Class for the Prime Money Market Fund as well as a new U.S. Core Equity Trust Fund.
CNI CHARTER FUNDS | PAGE 110
| report of independent registered public accounting firm |
To the Shareholders and Board of Trustees of
CNI Charter Funds:
We have audited the accompanying statements of assets and liabilities of the Government Money Market Fund, Prime Money Market Fund, California Tax Exempt Money Market Fund, Limited Maturity Fixed Income Fund, Government Bond Fund, Corporate Bond Fund, California Tax Exempt Bond Fund, Full Maturity Fixed Income Fund, High Yield Bond Fund, Multi-Asset Fund, Diversified Equity Fund, Large Cap Value Equity Fund, Large Cap Growth Equity Fund, and Socially Responsible Equity Fund (collectively, the “Funds”), including the schedules of investments, as of September 30, 2012, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years or periods in the five-year period then ended. These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of September 30, 2012, by correspondence with the custodian, and brokers, or other appropriate auditing procedures when 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 each of the aforementioned funds of the CNI Charter Funds as of September 30, 2012, the results of their operations for the year then ended, the changes in their net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years or periods in the five-year period then ended, in conformity with U.S. generally accepted accounting principles.
Philadelphia, Pennsylvania
November 21, 2012
CNI CHARTER FUNDS | PAGE 111
trustees and officers (Unaudited) |
September 30, 2012 |
Information pertaining to the Trustees and Officers of the Trust is set forth below as of September 30, 2012. Trustees who are not deemed to be “interested persons” of the Trust as defined in the Investment Company Act of 1940 are referred to as “Independent Trustees.” The Trust’s Statement of Additional Information (“SAI”) includes additional information about the Trustees and Officers. The SAI may be obtained without charge by calling 1-888-889-0799.
Name, Address, and Age | Position with the Trust | Term of Office(1) and Length of Time Served | Principal Occupation for the Past Five Years | Number of Portfolios in Fund Complex(2) Overseen by Trustee | Other Directorships Held by Trustee |
INDEPENDENT TRUSTEES | |||||
Irwin G. Barnet, Esq. CNI Charter Funds 400 North Roxbury Drive Beverly Hills, California 90210 Age: 74 | Trustee | Since 1999 | Attorney and of counsel, Reed Smith LLP, a law firm (2009-present). Partner, Reed Smith LLP (2003-2008). Attorney and principal, Crosby, Heafey, Roach & May P.C., a law firm (2000-2002). Attorney and principal, Sanders, Barnet, Goldman, Simons & Mosk, a law firm (1980-2000). | 14 | None |
Vernon C. Kozlen CNI Charter Funds 400 N. Roxbury Drive Beverly Hills, California 90210 Age: 69 | Trustee | Since 2007 | Retired (2007-present). President and Chief Executive Officer, CNI Charter Funds (2000-2007). Executive Vice President and Director of Asset Management Development, CNB (1996-2007). Director, Reed, Conner & Birdwell LLC (2000-2007), and Convergent Capital Management, LLC (2003-2007). Chairman of the Board, CNAM, Inc. (2001-2005). Chairman of the Board, City National Securities, Inc. (1999-2005). Director, CNAM, Inc. (2001-2006), and City National Securities, Inc. (1999-2006). | 14 | Windermere Jupiter Fund, LLC. CMS/Ironwood Multi-Strategy Fund LLC. CMS/Barlow Long-Short Equity Fund, LLC. |
Victor Meschures CNI Charter Funds 400 North Roxbury Drive Beverly Hills, California 90210 Age: 74 | Trustee | Since 1999 | Certified Public Accountant, Meschures, Campeas, Thompson, Snyder, Pocras & Levin LLP, an accounting firm (1964-present). | 14 | None |
William R. Sweet CNI Charter Funds 400 North Roxbury Drive Beverly Hills, California 90210 Age: 75 | Trustee | Since 1999 | Retired. Executive Vice President, Union Bank of California (1985-1996). | 14 | None |
James Wolford CNI Charter Funds 400 North Roxbury Drive Beverly Hills, California 90210 Age: 58 | Trustee | Since 1999 | Chief Financial Officer, Pacific Office Properties, a real estate investment trust (April 2010-present). Chief Financial Officer, Bixby Land Company, a real estate company (2004-March 2010). Regional Financial Officer, AIMCO, a real estate investment trust (2004). Chief Financial Officer, DBM Group, a direct mail marketing company (2001-2004). Senior Vice President and Chief Operating Officer, Forecast Commercial Real Estate Service, Inc. (2000-2001). Senior Vice President and Chief Financial Officer, Bixby Ranch Company (1985-2000). | 14 | None |
| (1) | Each Trustee serves until the next meeting of shareholders, if any, called for the purpose of electing trustees and until the election and qualification of his or her successor or until death, resignation, declaration of bankruptcy or incompetence by a court of competent jurisdiction, or removal by a majority vote of the Trustees or the shares entitled to vote. |
| (2) | “Fund complex” is defined as two or more registered investment companies that hold themselves out to investors as related companies or have a common investment adviser or affiliated investment advisers. |
CNI CHARTER FUNDS | PAGE 112
Name Address, and Age | Position with the Trust | Term of Office(1) and Length of Time Served | Principal Occupation for the Past Five Years |
OFFICERS | |||
Richard Gershen City National Bank 400 N. Roxbury Drive Beverly Hills, California 90210 Age: 58 | President and Chief Executive Officer | Since May 2010 | Executive Vice President, Wealth Management Division, CNB (2009-present). Executive Managing Director, Business Management and Strategy, Evergreen Investments, a division of Wachovia (2000-2009). |
Eric Kleinschmidt SEI Investments One Freedom Valley Drive Oaks, Pennsylvania 19456 Age: 44 | Controller and Chief Operating Officer | Since 2005 | Director of Fund Accounting, SEI Investments (2004-present). Manager of Fund Accounting, SEI Investments (1999-2004). |
William Souza City National Bank 555 South Flower Street Los Angeles, California 90071 Age: 61 | Vice President and Chief Compliance Officer | Since May 2012 | Senior Vice President and Senior Counsel, Legal Services Division, CNB (1998-present). |
Carolyn Mead SEI Investments One Freedom Valley Drive Oaks, Pennsylvania 19456 Age: 55 | Vice President and Secretary | Since February 2010 | Attorney, SEI Investments Company (2007-present). Associate, Stradley, Ronon, Stevens & Young (2004-2007). Counsel, ING Variable Annuities (1999-2002). |
Susan S. Rudzinski Convergent Capital Management LLC 500 W. Madison, Ste. 2620 Chicago, Illinois 60661 Age: 49 | Vice President | Since 2007 | Compliance Director, Convergent Capital Management, LLC (2006-present). Chief Compliance Officer, CCM Advisors, LLC (2006-2010). Self-employed Investment Advisory Compliance and Operations Consultant (2005-2006). Manager, Affiliate Contracts, The Burridge Group LLC (2003-2004). |
Timothy G. Solberg City National Bank 500 W. Madison, Ste. 2620 Chicago, Illinois 60661 Age: 59 | Vice President and Assistant Secretary | Since 2005 | Senior Vice President and Director – Sub-Advised Funds, City National Bank (2011-Present). Managing Director and Chief Investment Officer, CCM Advisors, LLC (2002-2010). |
Bernadette Sparling SEI Investments One Freedom Valley Drive Oaks, Pennsylvania 19456 Age: 35 | Vice President and Assistant Secretary | Since February 2010 | Attorney, SEI Investments Company (2005-present). Associate, Blank Rome LLP (2001-2005). |
Brent Vasher SEI Investments One Freedom Valley Drive Oaks, Pennsylvania 19456 Age: 30 | Vice President and Assistant Secretary | Since February 2010 | Attorney, SEI Investments Company (2008-present). Associate, Law Office of Lloyd Z. Remick (2006-2008). |
| (1) | Each officer serves until removed by the Board or the principal executive officer of the Trust, or until such officer resigns. |
CNI CHARTER FUNDS | PAGE 113
notice to shareholders (Unaudited) |
September 30, 2012 |
For shareholders that do not have a September 30, 2012 taxable year end, this notice is for informational purposes only. For shareholders with a September 30, 2012 taxable year end, please consult your tax advisor as to the pertinence of this notice.
For California income tax purposes, for the fiscal year ended September 30, 2012, each of the California Tax Exempt Bond Fund and California Tax Exempt Money Market Fund is designating 91.99% and 95.98%, respectively, of its distributions paid from net investment income as exempt-interest dividends under Section 17145 of the California Revenue and Taxation Code.
For Federal income tax purposes, for the fiscal year ended September 30, 2012 each Fund is designating the following items with regard to distributions paid during the year:
(A) Long Term Capital Gain Distributions | (B) Return of Capital | (C) Ordinary Income Distributions | (D) Tax Exempt Interest | (E) Total Distributions | (F) Dividends Qualifying for Corporate Dividends Rec. Deduction (1) | (G) Qualifying Dividend Income (2) | (H) U.S. Government Interest (3) | (I) Interest Related Dividends (4) | (J) Qualified Short-Term Capital Gain Dividends (5) | |
| Government Money Market Fund | 0.00% | 0.00% | 100.00% | 0.00% | 100.00% | 0.00% | 0.00% | 22.97% | 96.84% | 0.00% |
| Prime Money Market Fund | 0.00% | 0.00% | 100.00% | 0.00% | 100.00% | 0.00% | 0.00% | 0.77% | 95.82% | 0.00% |
| California Tax Exempt Money Market Fund | 0.00% | 0.00% | 0.49% | 99.51% | 100.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
| Limited Maturity Fixed Income Fund | 0.00% | 0.00% | 100.00% | 0.00% | 100.00% | 0.00% | 0.00% | 11.87% | 93.35% | 0.00% |
| Government Bond Fund | 5.52% | 0.00% | 94.48% | 0.00% | 100.00% | 0.00% | 0.00% | 16.01% | 96.11% | 0.00% |
| Corporate Bond Fund | 15.95% | 0.00% | 84.05% | 0.00% | 100.00% | 0.00% | 0.00% | 0.50% | 95.46% | 0.00% |
| California Tax Exempt Bond Fund | 18.78% | 0.00% | 3.54% | 77.68% | 100.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
| Full Maturity Fixed Income Fund | 31.70% | 0.00% | 68.30% | 0.00% | 100.00% | 0.00% | 0.00% | 17.23% | 82.57% | 100.00% |
| High Yield Bond Fund | 0.00% | 0.00% | 100.00% | 0.00% | 100.00% | 0.00% | 0.00% | 0.00% | 99.14% | 0.00% |
| Multi-Asset Fund | 0.00% | 0.00% | 100.00% | 0.00% | 100.00% | 12.87% | 26.11% | 0.00% | 5.05% | 0.00% |
| Diversified Equity Fund | 0.00% | 0.00% | 100.00% | 0.00% | 100.00% | 100.00% | 100.00% | 0.00% | 0.00% | 0.00% |
| Large Cap Value Equity Fund | 0.00% | 0.00% | 100.00% | 0.00% | 100.00% | 100.00% | 100.00% | 0.00% | 0.00% | 0.00% |
| Large Cap Growth Equity Fund | 0.00% | 0.00% | 100.00% | 0.00% | 100.00% | 100.00% | 100.00% | 0.00% | 0.00% | 0.00% |
| Socially Responsible Equity Fund | 0.00% | 0.00% | 100.00% | 0.00% | 100.00% | 100.00% | 100.00% | 0.00% | 0.00% | 0.00% |
| (1) | “Dividends Received Deduction” represent dividends which qualify for the corporate dividends received deduction. |
| (2) | “Qualifying Dividend Income” represent qualifying dividends as created by the Jobs and Growth Tax Relief Reconciliation Act of 2003. The Fund intends to designate the maximum amount permitted by law. |
| (3) | “U.S. Government Interest” represent the amount of interest that was derived from direct U.S. Government obligations and distributed during the fiscal year. This amount is reflected as a percentage of ordinary income. Generally, interest from direct U.S. Government obligations is exempt from state income tax. However, for shareholders who are residents of California, Connecticut or New York, the statutory threshold requirements were not satisfied to permit exemption of these amounts from state income. |
| (4) | “Interest Related Dividends” represent qualifying interest that is exempt from U.S. withholding tax when paid to foreign investors as created by the American Jobs Creation Act of 2004. |
| (5) | “Short-Term Capital Gain Dividends” represent qualifying short-term capital gain that is exempt from U.S. withholding tax when paid to foreign investors as created by the American Jobs Creation Act of 2004. |
Items (A), (B), (C), (D) and (E) are based on the percentage of each fund’s total distribution.
Items (F) and (G) are based on the percentage of “Ordinary Income Distributions.”
Item (H) is based on the percentage of gross income of each Fund.
Item (I) is based on the percentage of net investment income distributions.
Item (J) is based on the percentage of short-term capital gain distributions.
CNI CHARTER FUNDS | PAGE 114
disclosure of fund expenses (Unaudited) |
All mutual funds have operating expenses. As a shareholder of a Fund, your investment is affected by these ongoing costs, which include (among others) costs for portfolio management, administrative services, class-specific distribution fees and shareholder reports like this one. It is important for you to understand the impact of these costs on your investment returns.
Operating expenses such as these are deducted from the Fund’s gross income and directly reduce your final investment return. These expenses are expressed as a percentage of the Fund’s average net assets; this percentage is known as the Fund’s expense ratio.
The following examples use the expense ratio and are intended to help you understand the ongoing costs (in dollars) of investing in your Fund and to compare these costs with those of other mutual funds. The examples are based on an investment of $1,000 made at the beginning of the period shown and held for the entire period.
The table below illustrates your Fund’s costs in two ways:
Actual Fund Return. This section helps you to estimate the actual expenses that your Fund incurred over the period. The “Expenses Paid During Period” column shows the actual dollar expense cost incurred by a $1,000 investment in the Fund, and the “Ending Account Value” number is derived from deducting that expense cost from the Fund’s gross investment return.
You can use this information, together with the actual amount you invested in the Fund, to estimate the expenses you paid over that period. Simply divide your actual account value by $1,000 to arrive at a ratio (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply that ratio by the number shown for your Fund under “Expenses Paid During Period.”
Hypothetical 5% Return. This section helps you compare your Fund’s costs with those of other mutual funds. It assumes that the Fund had an annual 5% return before expenses during the year, but that the expense ratio (Column 3) for the period is unchanged. This example is useful in making comparisons because the Securities and Exchange Commission requires all mutual funds to make this 5% calculation. You can assess your Fund’s comparative cost by comparing the hypothetical result for your Fund in the “Expenses Paid During Period” column with those that appear in the same charts in the shareholder reports for other funds.
NOTE: Because the return is set at 5% for comparison purposes – NOT your Fund’s actual return – the account values shown do not apply to your specific investment.
| Beginning Account Value 4/1/2012 | Ending Account Value 9/30/2012 | Annualized Expense Ratios | Expense Paid During Period* | |||||||||||||
Government Money Market Fund | ||||||||||||||||
| Actual Fund Return | ||||||||||||||||
| Institutional Class | $ | 1,000.00 | $ | 1,000.10 | 0.16 | % | $ | 0.80 | ||||||||
| Class N | 1,000.00 | 1,000.10 | 0.16 | 0.80 | ||||||||||||
| Class S | 1,000.00 | 1,000.10 | 0.17 | 0.85 | ||||||||||||
| Hypothetical 5% Return | ||||||||||||||||
| Institutional Class | $ | 1,000.00 | $ | 1,024.20 | 0.16 | % | $ | 0.81 | ||||||||
| Class N | 1,000.00 | 1,024.20 | 0.16 | 0.81 | ||||||||||||
| Class S | 1,000.00 | 1,024.15 | 0.17 | 0.86 | ||||||||||||
Prime Money Market Fund | ||||||||||||||||
| Actual Fund Return | ||||||||||||||||
| Institutional Class | $ | 1,000.00 | $ | 1,000.10 | 0.26 | % | $ | 1.30 | ||||||||
| Class N | 1,000.00 | 1,000.10 | 0.27 | 1.35 | ||||||||||||
| Class S | 1,000.00 | 1,000.10 | 0.28 | 1.40 | ||||||||||||
| Hypothetical 5% Return | ||||||||||||||||
| Institutional Class | $ | 1,000.00 | $ | 1,023.70 | 0.26 | % | $ | 1.32 | ||||||||
| Class N | 1,000.00 | 1,023.65 | 0.27 | 1.37 | ||||||||||||
| Class S | 1,000.00 | 1,023.60 | 0.28 | 1.42 | ||||||||||||
| Beginning Account Value 4/1/2012 | Ending Account Value 9/30/2012 | Annualized Expense Ratios | Expense Paid During Period* | |||||||||||||
California Tax Exempt Money Market Fund | ||||||||||||||||
| Actual Fund Return | ||||||||||||||||
| Institutional Class | $ | 1,000.00 | $ | 1,000.10 | 0.15 | % | $ | 0.75 | ||||||||
| Class N | 1,000.00 | 1,000.10 | 0.15 | 0.75 | ||||||||||||
| Class S | 1,000.00 | 1,000.10 | 0.15 | 0.75 | ||||||||||||
| Hypothetical 5% Return | ||||||||||||||||
| Institutional Class | $ | 1,000.00 | $ | 1,024.25 | 0.15 | % | $ | 0.76 | ||||||||
| Class N | 1,000.00 | 1,024.25 | 0.15 | 0.76 | ||||||||||||
| Class S | 1,000.00 | 1,024.25 | 0.15 | 0.76 | ||||||||||||
Limited Maturity Fixed Income Fund | ||||||||||||||||
| Actual Fund Return | ||||||||||||||||
| Institutional Class | $ | 1,000.00 | $ | 1,009.30 | 0.68 | % | $ | 3.42 | ||||||||
| Class N | 1,000.00 | 1,009.00 | 0.94 | 4.72 | ||||||||||||
| Hypothetical 5% Return | ||||||||||||||||
| Institutional Class | $ | 1,000.00 | $ | 1,021.60 | 0.68 | % | $ | 3.44 | ||||||||
| Class N | 1,000.00 | 1,020.30 | 0.94 | 4.75 | ||||||||||||
| * | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period, multiplied by 183/366 (to reflect the one-half year period). |
CNI CHARTER FUNDS | PAGE 115
disclosure of fund expenses (Unaudited) (Continued) |
| Beginning Account Value 4/1/2012 | Ending Account Value 9/30/2012 | Annualized Expense Ratios | Expense Paid During Period* |
Government Bond Fund | ||||||||||||||||
| Actual Fund Return | ||||||||||||||||
| Institutional Class | $ | 1,000.00 | $ | 1,013.10 | 0.55 | % | $ | 2.77 | ||||||||
| Class N | 1,000.00 | 1,010.60 | 1.05 | 5.28 | ||||||||||||
| Servicing Class | 1,000.00 | 1,010.60 | 0.80 | 4.02 | ||||||||||||
| Hypothetical 5% Return | ||||||||||||||||
| Institutional Class | $ | 1,000.00 | $ | 1,022.25 | 0.55 | % | $ | 2.78 | ||||||||
| Class N | 1,000.00 | 1,019.75 | 1.05 | 5.30 | ||||||||||||
| Servicing Class | 1,000.00 | 1,021.00 | 0.80 | 4.04 | ||||||||||||
Corporate Bond Fund | ||||||||||||||||
| Actual Fund Return | ||||||||||||||||
| Class N | $ | 1,000.00 | $ | 1,023.90 | 0.99 | % | $ | 5.01 | ||||||||
| Servicing Class | 1,000.00 | 1,025.30 | 0.74 | 3.75 | ||||||||||||
| Hypothetical 5% Return | ||||||||||||||||
| Class N | $ | 1,000.00 | $ | 1,020.05 | 0.99 | % | $ | 5.00 | ||||||||
| Servicing Class | 1,000.00 | 1,021.30 | 0.74 | 3.74 | ||||||||||||
California Tax Exempt Bond Fund | ||||||||||||||||
| Actual Fund Return | ||||||||||||||||
| Class N | $ | 1,000.00 | $ | 1,021.20 | 0.85 | % | $ | 4.30 | ||||||||
| Servicing Class | 1,000.00 | 1,022.50 | 0.60 | 3.03 | ||||||||||||
| Hypothetical 5% Return | ||||||||||||||||
| Class N | $ | 1,000.00 | $ | 1,020.75 | 0.85 | % | $ | 4.29 | ||||||||
| Servicing Class | 1,000.00 | 1,022.00 | 0.60 | 3.03 | ||||||||||||
Full Maturity Fixed Income Fund | ||||||||||||||||
| Actual Fund Return | ||||||||||||||||
| Institutional Class | $ | 1,000.00 | $ | 1,036.00 | 0.68 | % | $ | 3.46 | ||||||||
| Class N | 1,000.00 | 1,033.80 | 0.93 | 4.73 | ||||||||||||
| Hypothetical 5% Return | ||||||||||||||||
| Institutional Class | $ | 1,000.00 | $ | 1,021.60 | 0.68 | % | $ | 3.44 | ||||||||
| Class N | 1,000.00 | 1,020.35 | 0.93 | 4.70 | ||||||||||||
High Yield Bond Fund | ||||||||||||||||
| Actual Fund Return | ||||||||||||||||
| Institutional Class | $ | 1,000.00 | $ | 1,058.50 | 0.85 | % | $ | 4.37 | ||||||||
| Class N | 1,000.00 | 1,056.80 | 1.40 | 7.20 | ||||||||||||
| Servicing Class | 1,000.00 | 1,057.20 | 1.10 | 5.66 | ||||||||||||
| Hypothetical 5% Return | ||||||||||||||||
| Institutional Class | $ | 1,000.00 | $ | 1,020.75 | 0.85 | % | $ | 4.29 | ||||||||
| Class N | 1,000.00 | 1,018.00 | 1.40 | 7.06 | ||||||||||||
| Servicing Class | 1,000.00 | 1,019.50 | 1.10 | 5.55 | ||||||||||||
| Beginning Account Value 4/1/2012 | Ending Account Value 9/30/2012 | Annualized Expense Ratios | Expense Paid During Period* |
Multi-Asset Fund | ||||||||||||||||
| Actual Fund Return | ||||||||||||||||
| Institutional Class | $ | 1,000.00 | $ | 1,013.20 | 0.59 | % | $ | 2.97 | ||||||||
| Class N | 1,000.00 | 1,010.70 | 1.09 | 5.48 | ||||||||||||
| Servicing Class | 1,000.00 | 1,010.90 | 0.84 | 4.22 | ||||||||||||
| Hypothetical 5% Return | ||||||||||||||||
| Institutional Class | $ | 1,000.00 | $ | 1,022.05 | 0.59 | % | $ | 2.98 | ||||||||
| Class N | 1,000.00 | 1,019.55 | 1.09 | 5.50 | ||||||||||||
| Servicing Class | 1,000.00 | 1,020.80 | 0.84 | 4.24 | ||||||||||||
Diversified Equity Fund | ||||||||||||||||
| Actual Fund Return | ||||||||||||||||
| Institutional Class | $ | 1,000.00 | $ | 997.20 | 0.83 | % | $ | 4.14 | ||||||||
| Class N | 1,000.00 | 995.90 | 1.08 | 5.39 | ||||||||||||
| Hypothetical 5% Return | ||||||||||||||||
| Institutional Class | $ | 1,000.00 | $ | 1,020.85 | 0.83 | % | $ | 4.19 | ||||||||
| Class N | 1,000.00 | 1,019.60 | 1.08 | 5.45 | ||||||||||||
Large Cap Value Equity Fund | ||||||||||||||||
| Actual Fund Return | ||||||||||||||||
| Institutional Class | $ | 1,000.00 | $ | 1,034.70 | 0.71 | % | $ | 3.61 | ||||||||
| Class N | 1,000.00 | 1,032.20 | 1.21 | 6.15 | ||||||||||||
| Servicing Class | 1,000.00 | 1,033.40 | 0.96 | 4.88 | ||||||||||||
| Hypothetical 5% Return | ||||||||||||||||
| Institutional Class | $ | 1,000.00 | $ | 1,021.45 | 0.71 | % | $ | 3.59 | ||||||||
| Class N | 1,000.00 | 1,018.95 | 1.21 | 6.11 | ||||||||||||
| Servicing Class | 1,000.00 | 1,020.20 | 0.96 | 4.85 | ||||||||||||
Large Cap Growth Equity Fund | ||||||||||||||||
| Actual Fund Return | ||||||||||||||||
| Class N | $ | 1,000.00 | $ | 1,035.90 | 1.24 | % | $ | 6.31 | ||||||||
| Servicing Class | 1,000.00 | 1,036.60 | 0.99 | 5.04 | ||||||||||||
| Hypothetical 5% Return | ||||||||||||||||
| Class N | $ | 1,000.00 | $ | 1,018.80 | 1.24 | % | $ | 6.26 | ||||||||
| Servicing Class | 1,000.00 | 1,020.05 | 0.99 | 5.00 | ||||||||||||
Socially Responsible Equity Fund | ||||||||||||||||
| Actual Fund Return | ||||||||||||||||
| Institutional Class | $ | 1,000.00 | $ | 999.10 | 0.90 | % | $ | 4.50 | ||||||||
| Class N | 1,000.00 | 997.90 | 1.15 | 5.74 | ||||||||||||
| Hypothetical 5% Return | ||||||||||||||||
| Institutional Class | $ | 1,000.00 | $ | 1,020.50 | 0.90 | % | $ | 4.55 | ||||||||
| Class N | 1,000.00 | 1,019.25 | 1.15 | 5.81 | ||||||||||||
| * | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period, multiplied by 183/366 (to reflect the one-half year period). |
CNI CHARTER FUNDS | PAGE 116
| board approval of advisory and sub-advisory agreements |
(Unaudited) |
The Board of Trustees of CNI Charter Funds (the “Trust”) is comprised of five Trustees, each of whom is independent of the Trust’s investment adviser and sub-advisers (the “Independent Trustees”). During the six months ended September 30, 2012, the Board and the Independent Trustees approved renewal of the Trust’s advisory agreements with City National Asset Management, Inc. (“CNAM”) with respect to each series of the Trust (each a “Fund” and collectively the “Funds”). They also approved renewal of the following agreements with the sub-advisers to certain of the Funds (collectively the “Sub-Advisers”):
| • | CNAM’s sub-advisory agreement with Robert W. Baird & Co. Incorporated (“Baird”) with respect to the Full Maturity Fixed Income Fund; |
| • | CNAM’s sub-advisory agreement with Boyd Watterson Asset Management, LLC (“Boyd Watterson”) with respect to the Full Maturity Fixed Income Fund; |
| • | CNAM’s sub-advisory agreement with Guggenheim Partners Investment Management, LLC (“Guggenheim”) with respect to the High Yield Bond Fund; |
| • | CNAM’s sub-advisory agreements with SKBA Capital Management, LLC (“SKBA”) with respect to the Socially Responsible Equity Fund and the Diversified Equity Fund; and |
| • | CNAM’s sub-advisory agreement with Turner Investments, L.P. (“Turner”) with respect to the Diversified Equity Fund. |
The advisory and sub-advisory agreements listed above are collectively referred to below as the “Agreements.”
| GENERAL INFORMATION |
The following information summarizes the Board’s considerations associated with its review of the Agreements. In connection with their deliberations, the Board considered such information and factors as they believed, in light of the legal advice furnished to them and their own business judgment, to be relevant. The Agreements were considered separately for each Fund, although the Board took into account the common interests of the Funds in its review. As described below, the Board considered the nature, quality and extent of the various investment advisory and administrative services performed by CNAM and each sub-adviser. In considering these matters, the Independent Trustees discussed the approval of the Agreements with management and in private sessions with counsel at which no representatives of CNAM or the Sub-Advisers were present.
The Board reviewed extensive materials regarding investment results of CNAM and each Sub-Adviser, advisory fee and expense comparisons, financial information with respect to each entity, descriptions of various functions such as compliance monitoring and portfolio trading practices, and information about the personnel providing investment management and administrative services to the Funds. They also took into account information they received at past meetings of the Board and its committees with respect to these matters.
In deciding to approve renewal of the Agreements, the Board and the Independent Trustees did not identify a single factor as controlling and this summary does not describe all of the matters considered. However, the Board and the Independent Trustees concluded that each of the various factors referred to below favored such approval.
| CITY NATIONAL ASSET MANAGEMENT, INC. |
| Nature, Extent and Quality of Services |
In reviewing the services provided by CNAM, the Board considered a variety of matters, including the background, education and experience of its key portfolio management and operational personnel; its overall financial strength and stability; its resources and efforts to retain, attract and motivate capable personnel to serve the Funds; and the overall general quality and depth of its organization. The Board also took into account the experience, capability and integrity of CNAM’s senior management; its investment philosophy and processes, including sub-adviser oversight processes; its brokerage, trading and soft dollar practices; its disaster recovery and contingency planning; and its commitment and systems in place with regard to compliance with applicable laws and regulations. The Board found all of these matters to be satisfactory.
| Investment Performance |
The Board assessed the performance of each Fund compared with its respective benchmark index or indexes and the average of all funds in its respective peer group category (each a “universe”) selected by Lipper, Inc. and iMoneyNet, Inc. (for the money market funds only) for the one-, three-, five- and ten-year and since inception periods ended June 30, 2012, as applicable. The Board also reviewed the performance of each Fund (other than the Limited Maturity Fixed Income Fund, Full Maturity Fixed Income Fund, Diversified Equity Fund and Socially Responsible Equity Fund, which are distributed through retail channels) compared with the average performance of all funds in its respective “bank channel” universe, which includes only those funds in the Fund’s Lipper universe that are distributed
CNI CHARTER FUNDS | PAGE 117
| board approval of advisory and sub-advisory agreements |
(Unaudited) (Continued) |
through institutional and retail bank channels. In addition, the Board reviewed the performance of each Fund compared to a select group of comparable funds determined by CNAM to have investment objectives similar to that of the Fund.
The Board’s observations with respect to the annualized total returns of the Funds’ Institutional Class shares were as follows:
| • | The returns of the Government Money Market Fund were equal to or above the returns of the relevant Lipper institutional money market fund universe and bank channel universe for the one-year and three-year periods, and above the returns of the iMoneyNet institutional fund universe for the one-, three- and five-year periods. They were below the average returns of the Lipper, bank channel and iMoneyNet universes for all other periods. |
| • | The returns of the Prime Money Market Fund and California Tax Exempt Money Market Fund were very close or equal to the returns of the relevant Lipper institutional money market fund universes, iMoneyNet institutional fund universes, and bank channel universes for the one- and three-year periods (except that the California Tax Exempt Money Market Fund return was significantly lower than the bank channel universe return for the one-year period), and below those measures for all other periods. |
| • | The returns of the Limited Maturity Fixed Income Fund were above the BofA Merrill Lynch U.S. 3-Month Treasury Bill Index returns for all periods (one-, three-, five- and ten-year and since inception) and above the BofA Merrill Lynch 1-3 Year U.S. Treasury Index returns for all periods except the since inception period. They were below the returns of the Lipper short/intermediate investment grade debt funds universe for all periods. |
| • | The returns of the Government Bond Fund were above the returns of the Barclays Capital U.S. 1-5 Year Government Bond Index for the one- and three-year periods, and below that measure for all other periods. They were below the returns of the Lipper short/intermediate U.S. government universe, bank channel universe and Barclays Capital U.S. Intermediate Government Bond Index for all periods. In considering this information, the Board noted CNAM’s observation that the Fund’s peer funds generally have greater maturity ranges than the Fund. |
| • | The returns of the Corporate Bond Fund were above the returns of the Lipper short/intermediate investment-grade universe and the bank channel universe for the ten-year and since-inception periods, and below those measures for all other periods. They were below the returns of the Barclays Capital U.S. Corporate 1-5 A3 or Higher, 2% Issuer Constrained Index and the Barclays Capital U.S. Intermediate Corporate Bond Index for all periods. The Board noted CNAM’s observation that the Fund at times held significant cash positions, which affected its performance. |
| • | The returns of the California Tax Exempt Bond Fund were above the returns of the Lipper California short/intermediate municipal debt universe and the bank channel universe for all periods. They were above the Barclays Capital CA Intermediate-Short Municipal Index returns for the one-year period, and below that measure for all other periods. |
| • | The returns of the Full Maturity Fixed Income Fund were above the returns of the Barclays Capital U.S. Intermediate US Government/Credit Index for the one- and three-year period. They were below the returns of that Index for the other periods, and below the returns of the Barclays Capital U.S. Aggregate Bond Index and the Lipper corporate A-rated debt funds universe for all periods. The Board considered CNAM’s observation that the Fund’s Lipper peer group included corporate bond funds, which had benefited from recent strong performance by corporate bonds, and that the Fund was more broadly diversified and had more low-grade investments than corporate bond funds generally. |
| • | The returns of the High Yield Bond Fund were above the returns of the Lipper high current yield fund universe for all periods, above or equal to the returns of the bank channel universe for all periods other than the ten-year period, and above or very close to the returns of the Citigroup High-Yield Market Capped Index returns for the three-year and since inception periods. |
| • | The returns of the Multi-Asset Fund were above the returns of the Lipper absolute return funds and bank channel universes for the three-year and since inception periods, and above the returns of the S&P 500 Index for the since inception period. They were below the returns of the Barclays Capital U.S. TIPS Index, a blended index comprised 60% of the S&P 500 Index and 40% of the Barclays Capital U.S. Intermediate Government/Credit Index, and the CPI plus 500 basis points benchmark for all periods. The Board noted CNAM’s observation that due to the Fund’s unique composition, the Fund’s benchmarks are very different from the Fund and that the Lipper universe is a better measure of the Fund’s performance. |
CNI CHARTER FUNDS | PAGE 118
| • | The returns of the Diversified Equity Fund were below the returns of the S&P 500 Index and the Lipper multi-cap core funds universe for all periods. In reviewing the Fund’s performance, the Board considered that CNAM had begun to manage a portion of the Fund in February 2012 using an index replication strategy and noted CNAM’s observation that both of the Fund’s sub-advisers had demonstrated past ability to recapture losses in positive markets. |
| • | The returns of the Large Cap Value Equity Fund were above or close to the Lipper large cap value funds universe returns for the one-, three-, five- and ten-year periods, above or close to the returns of the bank channel universe for the one-, five- and ten-year periods, and above or close to the returns of the S&P 500 Value Index returns for the five- and ten-year and since inception periods. |
| • | The returns of the Large Cap Growth Equity Fund were above or close to the returns of the Lipper large cap growth fund universe for the one- and five-year and since inception periods, above or close to the returns for the bank channel universe for the five- and ten-year and since inception periods, and above the returns of the S&P 500 Growth Index for the since inception period. |
| • | The returns of the Socially Responsible Equity Fund were above or close to the returns of the Lipper multi-cap value fund universe for the one- and five-year periods. They were below the returns of the MSCI KLD 400 Social Index and the Russell 1000 Value Index for all periods. The Board noted CNAM’s observation that as a value-oriented fund, the Fund differs from most socially responsible funds, which are generally growth oriented. |
The Board concluded that CNAM continued to provide satisfactory management and oversight services to the Funds. They noted that the investment results of the Funds over the long term were generally competitive; that the results for the Money Market Funds compared to their peer groups were acceptable given the special services and investment focuses of those Funds and the unusual market conditions applicable to the money market fund industry in recent years; and that consideration of returns of market indexes needed to take into account that indexes do not reflect the expenses of operating mutual funds.
| Advisory Fees and Fund Expenses |
The Board reviewed information regarding the advisory fees charged by CNAM and the total expenses of the Institutional Class of each Fund (as percentages of their respective average annual net assets) compared to those of the funds included in the relevant Lipper and bank channel universes, as applicable, and concluded that the advisory fees and expenses of the Funds continued to be reasonable.
The Board observed that the actual investment advisory fees (net of fee waivers) paid by the Government Money Market Fund and California Tax Exempt Money Market Fund were below the averages of the Lipper and bank channel universes; the fees paid by the California Tax Exempt Bond Fund and the Multi- Asset Fund were below the averages of the Lipper universes; and the fees paid by the other Funds generally were above the relevant Lipper and bank channel averages, but were within or below the middle 60% range for the relevant Lipper universes (except for the Limited Maturity Fixed Income Fund and the High Yield Bond Fund). In considering the information about advisory fees, the Board noted the relatively small sizes of the Funds compared to the average sizes of the funds in the relevant Lipper and bank channel universes. The Board considered that other than the Trust CNAM had only one investment advisory client, which was a cash management account, and that CNAM stopped providing services to that account in January 2012. The Board noted that although the advisory fees paid by the cash management account to CNAM were lower than the fees paid by the Trust’s Money Market Funds to CNAM, the Money Market Funds are required to comply with Rule 2a-7 and other regulations and restrictions under the 1940 Act, and that such compliance requires significantly more work and resources than management of separate accounts.
The Board considered that the total expense ratios of the Money Market Funds (net of fee waivers) were below the relevant Lipper universe and bank channel averages and except for the Prime Money Market Fund were in the lowest 20% of the relevant Lipper universes, and that the total expense ratios for all other Funds (net of fee waivers) were below the relevant Lipper universe averages and above the bank channel averages, as applicable (except for the expense ratios of the Government Bond Fund, California Tax Exempt Bond Fund, and the Large Cap Value Equity Fund, which were below or the same as both measures). They further noted that the expense ratios of all Funds were within the middle 60% range for the relevant Lipper universes (except for the Government Money Market Fund, California Tax Exempt Money Market Fund, Government Bond
CNI CHARTER FUNDS | PAGE 119
| board approval of advisory and sub-advisory agreements |
(Unaudited) (Continued) |
Fund, Multi-Asset Fund, Large Cap Value Fund and Socially Responsible Equity Fund, which were in the lowest 20% of the relevant Lipper universes).
The Board considered information prepared by CNAM relating to its costs and profits with respect to the Funds. The Board also considered the benefits received by CNAM and its affiliates as a result of CNAM’s relationship with the Funds, including investment advisory fees paid to CNAM, fees paid to City National Bank and City National Securities, Inc. for providing certain shareholder servicing and sub-distribution services to the Trust, benefits to City National Bank’s brokerage and wealth management business as a result of the availability of the Funds to its customers, and the intangible benefits of any favorable publicity arising in connection with the Funds’ performance. They also noted that although there were no advisory fee breakpoints, based on CNAM’s operations significant economies of scale were not likely to be realized until the asset levels of most of the Funds were significantly higher than their current levels.
| Conclusions |
Based on their review, including their consideration of each of the factors referred to above, the Board and the Independent Trustees concluded that the compensation payable to CNAM with respect to each of the Funds pursuant to its advisory agreements with the Trust is fair and reasonable in light of the nature and quality of the services being provided by CNAM to the respective Funds and their shareholders, and that renewal of the agreements was in the best interest of the Funds and their shareholders.
| SUB-ADVISERS |
| Nature, Extent and Quality of Services |
In reviewing the services provided by each of the Sub-Advisers, the Board considered a variety of matters, including the background, education and experience of the Sub-Adviser’s key portfolio management and operational personnel; its overall financial strength and stability; its resources and related efforts to retain, attract and motivate capable personnel to serve the relevant Funds; and the overall general quality and depth of its organization. The Board also reviewed each Sub-Adviser’s investment philosophy and processes as well as its brokerage and trading practices, its disaster recovery and contingency planning, and its commitment and systems in place with regard to compliance with applicable laws and regulations. The Board found all of these matters to be satisfactory.
| Investment Performance |
The Board’s observations regarding the performance of the Full Maturity Fixed Income Fund, High Yield Bond Fund, Diversified Equity Fund and Socially Responsible Equity Fund are described above. In addition, the Board assessed the performance of each of Baird’s and Boyd Watterson’s portions of the Full Maturity Fixed Income Fund, and SKBA’s and Turner’s portions of the Diversified Equity Fund, compared with the Sub-Adviser’s respective benchmark for various periods ended June 30, 2012. The Board made the following additional observations in reviewing the annualized total returns of each Sub-Adviser:
| • | The returns for Baird’s portion of the Full Maturity Fixed Income Fund were above the returns of the Barclays Capital U.S. Aggregate Bond Index for the one-, two-, three- and ten-year periods, and were below but close to the returns of the Index for the five- and seven-year periods. |
| • | The returns for Boyd Watterson’s portion of the Full Maturity Fixed Income Fund were above the returns of the Barclays Capital U.S. Intermediate Government/Credit Index for the three- and five-year periods and were below but close to the returns of the Index for the two-year period. |
| • | The returns for SKBA’s portion of the Diversified Equity Fund were below the returns of the Russell 1000 Value Index for all periods (up to and including the five-year period). The Board noted CNAM’s observations that SKBA’s portfolio performance for the five-year period underperformed its benchmark by a narrow margin, and that SKBA has demonstrated past ability to make up losses in positive markets. |
| • | The returns for Turner’s portion of the Diversified Equity Fund were below the returns of the Russell 1000 Growth Index for all periods (up to and including the three-year period). In considering this information, the Board noted that Turner began serving as a sub-adviser to the Fund in March 2008, at a time when the growth style was not in favor, and that in analyzing Turner’s performance, CNAM had concluded that Turner’s portfolio was not expected to perform well in the recent equity market, but that Turner has demonstrated past ability to outperform in positive markets. |
The Board concluded that each Sub-Adviser continued to provide satisfactory services to the Funds.
CNI CHARTER FUNDS | PAGE 120
| Advisory Fees and Fund Expenses |
The Board reviewed information regarding the advisory fees charged by each Sub-Adviser and observed that the fees charged by each Sub-Adviser were generally low compared to the fees it charged to its other institutional clients. The Board noted that Guggenheim’s advisory fee with respect to the High Yield Bond Fund was higher than its fees with respect to other mutual funds for which it serves as sub-adviser, but also noted that each of those other funds was significantly larger than the Fund. Similarly, the Board observed that Turner’s advisory fee with respect to the Diversified Equity Fund was higher than its fees with respect to another mutual fund for which it serves as sub-adviser, but noted that the other fund was larger than the Fund and was an “earlier adopter” of Turner’s strategy. The Trustees noted that CNAM pays all sub-advisory fees out of CNAM’s advisory fee.
The Board considered information prepared by each Sub-Adviser relating to its revenues and profits with respect to the Fund or Funds for which it serves as sub-adviser. The Board also considered the benefits received by each Sub-Adviser and its affiliates as a result of its relationship with the Funds, including the sub-advisory fees paid to the Sub-Adviser, the intangible benefits of its association with the Funds generally and any favorable publicity arising in connection with the Funds’ performance.
| Conclusions |
Based on their review, including their consideration of each of the factors referred to above, the Board and the Independent Trustees concluded that the compensation payable to each Sub-Adviser pursuant to its respective sub-advisory agreement is fair and reasonable in light of the nature and quality of the services being provided by each Sub-Adviser to the respective Funds and their shareholders, and that renewal of each sub-advisory agreement was in the best interest of the Funds and their shareholders.
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CNI CHARTER FUNDS | PAGE 124
For more information on CNI Charter Funds, including charges
and expenses, please call 1-888-889-0799 or go to cnicharterfunds.com
for a free prospectus. Read it carefully before you invest or send money.
| 3958.01 | 10/12 | CNI-AR-001-1100 |
Item 2. Code of Ethics.
The registrant has adopted a code of ethics that applies to the registrant’s principal executive officer, principal financial officer and principal accounting officer.
Item 3. Audit Committee Financial Expert.
(a)(1) The registrant’s board of trustees has determined that the registrant has at least one audit committee financial expert serving on the audit committee.
(a)(2) The audit committee financial experts are William R. Sweet and James R. Wolford. Messrs. Sweet and Wolford are independent as defined in Form N-CSR Item 3(a)(2).
Item 4. Principal Accountant Fees and Services.
Fees billed by KPMG LLP Related to the Trust
KPMG LLP billed the Trust aggregate fees for services rendered to the Trust for the last two fiscal years as follows:
| 2012 | 2011 | ||||||
| All fees and services to the Trust that were pre-approved | All fees and services to service affiliates that were pre-approved | All other fees and services to service affiliates that did not require pre-approval | All fees and services to the Trust that were pre-approved | All fees and services to service affiliates that were pre-approved | All other fees and services to service affiliates that did not require pre-approval | ||
| (a) | Audit Fees(1) | $290,500 | N/A | N/A | $309,500 | N/A | N/A |
| (b) | Audit-Related Fees | N/A | N/A | N/A | N/A | N/A | N/A |
| (c) | Tax Fees | $62,200 | N/A | N/A | $61,875 | N/A | N/A |
| (d) | All Other Fees | N/A | N/A | N/A | N/A | N/A | N/A |
Notes:
| (1) | Audit fees include amounts related to the audit of the registrant’s annual financial statements and services normally provided by the accountant in connection with statutory and regulatory filings. |
| (e)(1) | Not Applicable |
| (e)(2) | Percentage of fees billed applicable to non-audit services pursuant to waiver of pre-approval requirement were as follows: |
| 2012 | 2011 | |
| Audit-Related Fees | N/A | N/A |
| Tax Fees | N/A | N/A |
| All Other Fees | N/A | N/A |
| (f) | Not Applicable |
| (g) | The aggregate non-audit fees and services billed by KPMG LLP for the last two fiscal years were $62,200 and $61,875 for 2012 and 2011, respectively. |
| (h) | Not Applicable |
Item 5. Audit Committee of Listed Registrants.
Not applicable to open-end management investment companies.
Item 6. Schedule of Investments
Not applicable.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not applicable to open-end management investment companies.
Item 8. Portfolio Managers of Closed-End Management Investment Companies
Not applicable. Effective for closed-end management investment companies for fiscal years ending on or after December 31, 2005
Item 9. Purchases of Equity Securities by Closed-End Management Company and Affiliated Purchasers.
Not applicable to open-end management investment companies.
Item 10. Submission of Matters to a Vote of Security Holders.
There have been no changes to the procedures by which shareholders may recommend nominees to the registrant’s Board of Trustees during the period covered by this report.
Item 11. Controls and Procedures.
(a) The certifying officers, whose certifications are included herewith, have evaluated the registrant’s disclosure controls and procedures within 90 days of the filing date of this report. In their opinion, based on their evaluation, the registrant’s disclosure controls and procedures are adequately designed, and are operating effectively to ensure, that information required to be disclosed by the registrant in the reports it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms.
(b) There were no significant changes in the registrant’s internal control over financial reporting that occurred during the registrant’s last fiscal half-year that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
Items 12. Exhibits.
(a)(1) Code of Ethics attached hereto.
(a)(2) A separate certification for the principal executive officer and the principal financial officer of the registrant as required by Rule 30a-2(a) under the Investment Company Act of 1940, as amended (17 CFR 270.30a-2(a)), are filed herewith.
(b) Officer certifications as required by Rule 30a-2(b) under the Investment Company Act of 1940, as amended (17 CFR 270.30a-2(b)) also accompany this filing as an Exhibit.
SIGNATURES
Pursuant to the requirements of the securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| (Registrant) | CNI Charter Funds | |
| By (Signature and Title) | /s/ Rich Gershen | |
| Rich Gershen, President & CEO | ||
Date: December 5, 2012 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| By (Signature and Title) | /s/ Rich Gershen | |
| Rich Gershen, President & CEO | ||
Date: December 5, 2012 | ||
| By (Signature and Title) | /s/ Eric Kleinschmidt | |
| Eric Kleinschmidt, Controller and COO | ||
Date: December 5, 2012 |