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 811-22045
Wisconsin Capital Funds, Inc.
(Exact name of registrant as specified in charter)
1200 John Q. Hammons Drive
Second Floor
Madison, Wisconsin 53717
(Address of principal executive offices) (Zip code)
Thomas G. Plumb
1200 John Q. Hammons Drive
Second Floor
Madison, Wisconsin 53717
(Name and address of agent for service)
(608) 824-8800
Registrant's telephone number, including area code
Date of fiscal year end: March 31
Date of reporting period: March 31, 2011
Item 1. Reports to Stockholders.
Plumb Balanced Fund
Plumb Equity Fund
ANNUAL REPORT
March 31, 2011
www.plumbfunds.com
PLUMB FUNDS
March 31, 2011
Dear Fellow Shareholders:
We are pleased to present you the fourth annual report of the Plumb Funds. The Funds commenced operations May 24, 2007, in a very challenging investment environment. The fiscal year ended March 31, 2011, continued the second year of recovery for the world stock markets, and both the Plumb Balanced Fund and the Plumb Equity Fund provided shareholders double-digit returns, with the Funds up 10.76% and 12.31%, respectively, for the past 12 months. For the last three years, the average annual return has been 2.97% for the Plumb Balanced Fund and 3.01% for the Plumb Equity Fund. Since inception (5/24/2007), the Plumb Balanced Fund and Plumb Equity Fund have averaged annual returns of -0.87% and -2.54%, respectively. The Balanced Fund’s Gross Expense Ratio for the year ended March 31, 2011 was 1.66%. The Equity Fund’s Gross Expense Ratio for the year ended March 31, 2011 was 2.21%.
Performance data quoted represents past performance and does not guarantee future results. Investment returns and principal value will fluctuate, and when sold, may be worth more or less than their original cost. Performance data current to the most recent month-end may be lower or higher than the performance quoted and can be obtained by calling 866-987-7888.
The Funds’ performance should be reviewed in the light of the markets that they operate in. For the last one year, three years, and since the Funds’ inception, the U.S. stock market has had average annual returns of 15.65%, 2.35% and -1.14%, as measured by the total return of the S&P 500. The broader international markets, as measured by the MSCI EAFE index, have averaged 7.47%, -5.83% and -6.93%, while the Barclays Capital Government/Corporate Bond index averaged 4.63%, 4.49% and 5.80% for the same time frames.
Our investment approach is to seek out good quality, growing companies trading at reasonable prices. In the Balanced Fund, we generally use fixed income investments in an attempt to moderate the impact of the volatility of the stock market and to provide an income component to our total return objective. With the low interest rate environment present since the financial crisis, it has been difficult to find attractive fixed income instruments to meet that objective. In fact, at times last year, the dividend yield on high quality blue-chip stocks exceeded the yield of ten-year U.S. Treasury Bonds. In this environment, we have added income generating securities that may have an equity component to the Balanced Fund’s overall asset mix. Convertible bonds, REITs, and MLPs are examples of higher yielding securities that combine capital appreciation potential with high current income yields.
Absolute and relative investment returns typically are influenced by the markets we operate in, our allocation to the sectors within the market, and our individual security selection. With the S&P 500 up in excess of 15% and the EAFE up less than half of that over the past year, overall our international exposure dampened our equity return. In addition, our relative under-weight in the financial stocks and our stock selection in the energy sector also provided a headwind to our relative returns over the last year.
Having said that, the largest individual contributor to our investment return over the last year was an energy technology company, Global Geophysical Services,
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PLUMB FUNDS
followed by our investments in a silver ETF, Discover Financial Services, and three other energy stocks. In the Balanced Fund, individual bond selections of convertible securities in RTI International Metals and Linear Technology Corporation, as well as the recovery in select financial company debt instruments, led our overall fixed income performance.
We believe that the Funds’ equities and fixed income investments are positioned to potentially benefit from an improving worldwide economic environment while seeking to protect us from a rising interest rate scenario.
Best wishes in the coming year from all of us at the Plumb Funds.
Thomas G. Plumb
Must be preceded or accompanied by a current prospectus.
Please refer to the schedule of investments in this report for complete holdings information.
Mutual fund investing involves risk. Principal loss is possible. The Funds may invest in small and mid-sized companies which involve additional risks such as limited liquidity and greater volatility. The Funds invest in foreign securities which involve greater volatility and political, economic and currency risks and differences in accounting methods. The Balanced Fund will invest in debt securities, which typically decrease in value when interest rates rise. This risk is usually greater for longer-term debt securities. Investments by the Balanced Fund in lower-rated and non-rated securities present a greater risk of loss to principal and interest than higher-rated securities. Investments in Asset Backed and Mortgage Backed Securities include additional risks that investors should be aware of such as credit risk, prepayment risk, possible illiquidity and default, as well as increased susceptibility to adverse economic developments. Because the Funds may invest in ETFs, they are subject to additional risks that do not apply to conventional mutual funds, including the risks that the market price of an ETF’s shares may trade at a discount to its net asset value (“NAV”), an active secondary trading market may not develop or be maintained, or trading may be halted by the exchange in which they trade, which may impact a Fund’s ability to sell its shares.
Fund holdings and sector allocations are subject to change and should not be considered recommendations to buy or sell any security.
The S&P 500 Index is an unmanaged market capitalization-weighted index based on the average weighted performance of 500 widely held common stocks. The Barclays Capital Intermediate Government/Credit Bond Index is an unmanaged market value weighted index measuring both the principal price changes of, and income provided by, the underlying universe of securities that comprise the index. The MSCI EAFE Index is an unmanaged market capitalization-weighted index that is designed to measure the equity market performance of developed markets, excluding the US & Canada. You cannot invest directly in an index.
The Plumb Funds are distributed by Quasar Distributors, LLC.
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PLUMB FUNDS
Expense Example
March 31, 2011 (Unaudited)
As a shareholder of the Plumb Funds (the “Funds”), you incur ongoing costs, including investment advisory fees; distribution (12b-1) fees; and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (October 1, 2010 – March 31, 2011).
Actual Expenses
The first line of the table on the following page provides information about actual account values and actual expenses. However, the table does not include shareholder specific fees such as the $15.00 fee charged for wire redemptions. The table also does not include portfolio trading commissions and related trading costs. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During the Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line of the table on the following page provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Funds and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees, or exchange fees, which, although not charged by the Funds, may be charged by other funds. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
5
PLUMB FUNDS
Expense Example
March 31, 2011 (Unaudited) (Continued)
Plumb Balanced Fund
| Expenses Paid | |||
| Beginning | Ending | During the Period* | |
| Account Value | Account Value | October 1, 2010 to | |
| October 1, 2010 | March 31, 2011 | March 31, 2011 | |
| Actual | $1,000.00 | $1,093.00 | $6.52 |
| Hypothetical | |||
| (5% return per | |||
| year before expenses) | $1,000.00 | $1,018.70 | $6.29 |
| * | Expenses are equal to the Fund’s annualized expense ratio of 1.25%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the partial year period). |
Plumb Equity Fund
| Expenses Paid | |||
| Beginning | Ending | During the Period* | |
| Account Value | Account Value | October 1, 2010 to | |
| October 1, 2010 | March 31, 2011 | March 31, 2011 | |
| Actual | $1,000.00 | $1,119.60 | $7.40 |
| Hypothetical | |||
| (5% return per | |||
| year before expenses) | $1,000.00 | $1,017.95 | $7.04 |
| * | Expenses are equal to the Fund’s annualized expense ratio of 1.40%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the partial year period). |
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PLUMB FUNDS
Plumb Balanced Fund (Unaudited)
Growth of a Hypothetical $10,000 Investment at March 31, 2011 vs. Barclays
Capital Intermediate Government/Credit Bond Index & S&P 500 Index
Average Annual Rate of Return
Periods ended March 31, 2011
| 1 Year | 3 Year | Since Inception | |
| Plumb Balanced Fund | 10.76% | 2.97% | -0.87% |
| Barclays Capital Intermediate | |||
| Government/Credit Bond Index | 4.63% | 4.49% | 5.80% |
| S&P 500 Index | 15.65% | 2.35% | -1.14% |
Performance data quoted represents past performance and does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling 1-866-987-7888.
The line graph and performance table do not reflect the deduction of taxes that a shareholder may pay on fund distributions or the redemption of fund shares. Total return calculations reflect expense reimbursements and fee waivers.
The Barclays Capital Intermediate Government/Credit Bond Index is an unmanaged index which includes nonconvertible bonds publicly issued by the U.S. government or its agencies; corporate bonds guaranteed by the U.S. government and quasi-federal corporations; and publicly issued, fixed rate, nonconvertible domestic bonds of companies in industry, public utilities, and finance.
The Standard & Poor’s 500 Index (S&P 500) is an unmanaged, capitalization-weighted index generally representative of the U.S. market for large capitalization stocks.
The Fund’s portfolio holdings may differ significantly from the securities held in the relevant index and, unlike a mutual fund, an unmanaged index assumes no transaction costs, taxes, management fees or other expenses. You cannot invest directly in an index.
7
PLUMB FUNDS
Plumb Equity Fund (Unaudited)
Growth of a Hypothetical $10,000 Investment
at March 31, 2011 vs. S&P 500 Index
Average Annual Rate of Return
Periods ended March 31, 2011
| 1 Year | 3 Year | Since Inception | |
| Plumb Equity Fund | 12.31% | 3.01% | -2.54% |
| S&P 500 Index | 15.65% | 2.35% | -1.14% |
Performance data quoted represents past performance and does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling 1-866-987-7888.
The line graph and performance table do not reflect the deduction of taxes that a shareholder may pay on fund distributions or the redemption of fund shares. Total return calculations reflect expense reimbursements and fee waivers.
The Standard & Poor’s 500 Index (S&P 500) is an unmanaged, capitalization-weighted index generally representative of the U.S. market for large capitalization stocks.
The Fund’s portfolio holdings may differ significantly from the securities held in the relevant index and, unlike a mutual fund, an unmanaged index assumes no transaction costs, taxes, management fees or other expenses. You cannot invest directly in an index.
8
PLUMB FUNDS
Plumb Balanced Fund
Investments by Asset Allocation as of March 31, 2011
(as a Percentage of Total Investments) (Unaudited)
9
PLUMB FUNDS
Plumb Equity Fund
Investments by Asset Allocation as of March 31, 2011
(as a Percentage of Total Investments) (Unaudited)
10
PLUMB FUNDS
Plumb Balanced Fund
Schedule of Investments – March 31, 2011
| Shares | Value | |||||||
| COMMON STOCKS – 66.26% | ||||||||
| Beverage and Tobacco Product Manufacturing – 2.31% | ||||||||
| PepsiCo, Inc. | 16,000 | $ | 1,030,560 | |||||
| Chemical Manufacturing – 11.43% | ||||||||
| Abbott Laboratories | 18,300 | 897,615 | ||||||
| Air Products & Chemicals, Inc. | 7,000 | 631,260 | ||||||
| Church & Dwight Company, Inc. | 7,500 | 595,050 | ||||||
| E.I. du Pont de Nemours & Company | 10,000 | 549,700 | ||||||
| Johnson & Johnson | 10,000 | 592,500 | ||||||
| Merck & Company, Inc. | 14,000 | 462,140 | ||||||
| Procter & Gamble Company | 10,000 | 616,000 | ||||||
| Teva Pharmaceutical Industries Ltd. – ADR | 15,100 | 757,567 | ||||||
| 5,101,832 | ||||||||
| Computer and Electronic Product Manufacturing – 5.62% | ||||||||
| Apple, Inc. (a) | 2,650 | 923,393 | ||||||
| Cisco Systems, Inc. | 30,000 | 514,500 | ||||||
| Microchip Technology, Inc. | 18,000 | 684,180 | ||||||
| QUALCOMM, Inc. | 7,000 | 383,810 | ||||||
| 2,505,883 | ||||||||
| Couriers and Messengers – 0.75% | ||||||||
| United Parcel Service, Inc. – Class B | 4,500 | 334,440 | ||||||
| Credit Intermediation and Related Activities – 6.36% | ||||||||
| CIT Group, Inc. (a) | 10,000 | 425,500 | ||||||
| Citigroup, Inc. | 100,000 | 442,000 | ||||||
| Discover Financial Services | 38,000 | 916,560 | ||||||
| Visa, Inc. – Class A | 14,300 | 1,052,766 | ||||||
| 2,836,826 | ||||||||
| Electrical Equipment, Appliance, and | ||||||||
| Component Manufacturing – 1.57% | ||||||||
| Emerson Electric Company | 12,000 | 701,160 | ||||||
| Food Manufacturing – 1.37% | ||||||||
| Unilever PLC – ADR | 20,000 | 612,400 | ||||||
| Food Services and Drinking Places – 1.36% | ||||||||
| McDonald’s Corporation | 8,000 | 608,720 | ||||||
The accompanying notes are an integral part of these financial statements.
11
PLUMB FUNDS
Plumb Balanced Fund
Schedule of Investments – March 31, 2011 (Continued)
| Shares | Value | |||||||
| COMMON STOCKS (Continued) | ||||||||
| General Merchandise Stores – 1.31% | ||||||||
| Kohl’s Corporation | 11,000 | $ | 583,440 | |||||
| Health and Personal Care Stores – 2.00% | ||||||||
| CVS Caremark Corporation | 26,000 | 892,320 | ||||||
| Insurance Carriers and Related Activities – 0.85% | ||||||||
| Greenlight Capital Re, Ltd. – Class A (a) (b) | 13,500 | 380,835 | ||||||
| Internet Service Providers, Web Search Portals – 1.49% | ||||||||
| Automatic Data Processing, Inc. | 13,000 | 667,030 | ||||||
| Management of Companies and Enterprises – 3.13% | ||||||||
| Foster Wheeler AG (a) (b) | 20,300 | 763,686 | ||||||
| The Goldman Sachs Group, Inc. | 4,000 | 633,880 | ||||||
| 1,397,566 | ||||||||
| Mining (except Oil and Gas) – 1.34% | ||||||||
| Newmont Mining Corporation | 11,000 | 600,380 | ||||||
| Miscellaneous Manufacturing – 2.21% | ||||||||
| 3M Company | 6,000 | 561,000 | ||||||
| CareFusion Corporation (a) | 15,000 | 423,000 | ||||||
| 984,000 | ||||||||
| Oil and Gas Extraction – 2.87% | ||||||||
| ATP Oil & Gas Corporation (a) | 28,710 | 519,938 | ||||||
| Petroleo Brasileiro S.A. – ADR | 18,800 | 760,084 | ||||||
| 1,280,022 | ||||||||
| Petroleum and Coal Products Manufacturing – 6.85% | ||||||||
| BP PLC – ADR | 17,100 | 754,794 | ||||||
| Chevron Corporation | 8,500 | 913,155 | ||||||
| ConocoPhillips | 10,000 | 798,600 | ||||||
| Exxon Mobil Corporation | 7,000 | 588,910 | ||||||
| 3,055,459 | ||||||||
| Primary Metal Manufacturing – 0.71% | ||||||||
| RTI International Metals, Inc. (a) | 10,150 | 316,172 | ||||||
The accompanying notes are an integral part of these financial statements.
12
PLUMB FUNDS
Plumb Balanced Fund
Schedule of Investments – March 31, 2011 (Continued)
| Shares | Value | |||||||
| COMMON STOCKS (Continued) | ||||||||
| Professional, Scientific, and Technical Services – 2.33% | ||||||||
| Global Geophysical Services, Inc. (a) | 30,000 | $ | 433,800 | |||||
| MasterCard, Inc. – Class A | 2,400 | 604,128 | ||||||
| 1,037,928 | ||||||||
| Publishing Industries – 2.15% | ||||||||
| BMC Software, Inc. (a) | 10,000 | 497,400 | ||||||
| Symantec Corporation (a) | 25,000 | 463,500 | ||||||
| 960,900 | ||||||||
| Rail Transportation – 1.10% | ||||||||
| Union Pacific Corporation | 5,000 | 491,650 | ||||||
| Support Activities for Mining – 2.92% | ||||||||
| Atwood Oceanics, Inc. (a) | 12,000 | 557,160 | ||||||
| Weatherford International Ltd. (a) (b) | 33,000 | 745,800 | ||||||
| 1,302,960 | ||||||||
| Telecommunications – 2.13% | ||||||||
| Vodafone Group PLC – ADR | 33,000 | 948,750 | ||||||
| Transportation Equipment Manufacturing – 2.10% | ||||||||
| Ford Motor Company (a) | 42,000 | 626,220 | ||||||
| Visteon Corporation (a) | 5,000 | 312,450 | ||||||
| 938,670 | ||||||||
| TOTAL COMMON STOCKS | ||||||||
| (Cost $24,995,857) | 29,569,903 | |||||||
| PUBLICLY-TRADED PARTNERSHIPS – 1.37% | ||||||||
| Real Estate – 1.37% | ||||||||
| Penn Virginia Resources Partners, L.P. | 22,000 | 609,400 | ||||||
| TOTAL PUBLICLY-TRADED PARTNERSHIPS | ||||||||
| (Cost $583,352) | 609,400 | |||||||
| PREFERRED SECURITIES – 1.79% | ||||||||
| Securities, Commodity Contracts, and Other | ||||||||
| Financial Investments and Related Activities – 1.79% | ||||||||
| The Goldman Sachs Group, Inc., Series D | ||||||||
| 4.000%, perpetual (c) | 25,000 | 555,250 | ||||||
The accompanying notes are an integral part of these financial statements.
13
PLUMB FUNDS
Plumb Balanced Fund
Schedule of Investments – March 31, 2011 (Continued)
| Shares | Value | |||||||
| PREFERRED SECURITIES (Continued) | ||||||||
| Securities, Commodity Contracts, and Other | ||||||||
| Financial Investments and Related Activities (Continued) | ||||||||
| Morgan Stanley Capital Trust VIII | ||||||||
| 6.450%, 01/15/2046 | 10,000 | $ | 242,100 | |||||
| 797,350 | ||||||||
| TOTAL PREFERRED SECURITIES | ||||||||
| (Cost $653,361) | 797,350 | |||||||
| EXCHANGE-TRADED FUNDS – 0.64% | ||||||||
| Funds, Trusts, and Other Financial Vehicles – 0.33% | ||||||||
| iShares Silver Trust (a) | 4,000 | 147,160 | ||||||
| Securities, Commodity Contracts, and Other | ||||||||
| Financial Investments and Related Activities – 0.31% | ||||||||
| SPDR Gold Trust (a) | 1,000 | 139,820 | ||||||
| TOTAL EXCHANGE-TRADED FUNDS | ||||||||
| (Cost $173,951) | 286,980 | |||||||
| Principal | ||||||||
| Amount | ||||||||
| CONVERTIBLE BONDS – 3.42% | ||||||||
| Primary Metal Manufacturing – 1.31% | ||||||||
| RTI International Metals, Inc. | ||||||||
| 3.000%, 12/01/2015 | $ | 500,000 | 582,500 | |||||
| Securities, Commodity Contracts, and Other | ||||||||
| Financial Investments and Related Activities – 1.56% | ||||||||
| NASDAQ OMX Group, Inc. | ||||||||
| 2.500%, 08/15/2013 | 700,000 | 696,500 | ||||||
| Specialty Trade Contractors – 0.55% | ||||||||
| Transocean, Inc., Series B | ||||||||
| 1.500%, 12/15/2037 (b) | 250,000 | 247,188 | ||||||
| TOTAL CONVERTIBLE BONDS | ||||||||
| (Cost $1,412,027) | 1,526,188 | |||||||
The accompanying notes are an integral part of these financial statements.
14
PLUMB FUNDS
Plumb Balanced Fund
Schedule of Investments – March 31, 2011 (Continued)
| Principal | ||||||||
| Amount | Value | |||||||
| CORPORATE BONDS – 21.11% | ||||||||
| Chemical Manufacturing – 1.20% | ||||||||
| Biogen Idec, Inc. | ||||||||
| 6.000%, 03/01/2013 | $ | 500,000 | $ | 534,563 | ||||
| Credit Intermediation and Related Activities – 3.80% | ||||||||
| Block Financial LLC | ||||||||
| 7.875%, 01/15/2013 | 500,000 | 538,660 | ||||||
| CIT Group, Inc. | ||||||||
| 7.000%, 05/01/2014 | 600,000 | 612,750 | ||||||
| Zions Bancorporation | ||||||||
| 7.750%, 09/23/2014 | 500,000 | 543,421 | ||||||
| 1,694,831 | ||||||||
| Food Manufacturing – 1.19% | ||||||||
| Kraft Foods, Inc. | ||||||||
| 6.250%, 06/01/2012 | 500,000 | 530,523 | ||||||
| Funds, Trusts, and Other Financial Vehicles – 1.23% | ||||||||
| HCP, Inc. | ||||||||
| 6.000%, 03/01/2015 | 500,000 | 546,863 | ||||||
| Health and Personal Care Stores – 1.97% | ||||||||
| CVS Pass-Through Trust | ||||||||
| 6.943%, 01/10/2030 | 307,547 | 335,158 | ||||||
| Medco Health Solutions, Inc. | ||||||||
| 6.125%, 03/15/2013 | 500,000 | 541,814 | ||||||
| 876,972 | ||||||||
| Machinery Manufacturing – 1.79% | ||||||||
| General Electric Company | ||||||||
| 5.000%, 02/01/2013 | 750,000 | 799,406 | ||||||
| Merchant Wholesalers, Nondurable Goods – 1.21% | ||||||||
| Lorillard Tobacco Company | ||||||||
| 6.875%, 05/01/2020 | 500,000 | 541,692 | ||||||
| Oil and Gas Extraction – 1.28% | ||||||||
| Noble Holding International Ltd. | ||||||||
| 7.375%, 03/15/2014 (b) | 500,000 | 570,513 | ||||||
The accompanying notes are an integral part of these financial statements.
15
PLUMB FUNDS
Plumb Balanced Fund
Schedule of Investments – March 31, 2011 (Continued)
| Principal | ||||||||
| Amount | Value | |||||||
| CORPORATE BONDS (Continued) | ||||||||
| Paper Manufacturing – 1.25% | ||||||||
| Sealed Air Corporation | ||||||||
| 7.875%, 06/15/2017 | $ | 500,000 | $ | 559,405 | ||||
| Petroleum and Coal Products Manufacturing – 1.28% | ||||||||
| Atlantic Richfield Company | ||||||||
| 8.500%, 04/01/2012 | 539,000 | 572,847 | ||||||
| Securities, Commodity Contracts, and Other | ||||||||
| Financial Investments and Related Activities – 3.34% | ||||||||
| The Goldman Sachs Group, Inc. | ||||||||
| 5.375%, 03/15/2020 | 500,000 | 508,564 | ||||||
| Morgan Stanley | ||||||||
| 5.000%, 08/31/2025 (c) | 500,000 | 490,369 | ||||||
| 5.000%, 08/19/2025 (c) | 500,000 | 492,374 | ||||||
| 1,491,307 | ||||||||
| Telecommunications – 1.15% | ||||||||
| Qwest Corporation | ||||||||
| 7.875%, 09/01/2011 | 500,000 | 515,000 | ||||||
| Utilities – 0.42% | ||||||||
| Alliant Energy Corporation | ||||||||
| 4.000%, 10/15/2014 | 180,000 | 187,293 | ||||||
| TOTAL CORPORATE BONDS | ||||||||
| (Cost $9,101,185) | 9,421,215 | |||||||
| U.S. GOVERNMENT AGENCY ISSUES – 2.19% | ||||||||
| Federal Home Loan Banks | ||||||||
| 2.000%, 08/18/2025 (c) | 250,000 | 247,224 | ||||||
| Federal National Mortgage Association | ||||||||
| 2.000%, 07/29/2030 (c) | 750,000 | 729,022 | ||||||
| TOTAL U.S. GOVERNMENT AGENCY ISSUES | ||||||||
| (Cost $974,125) | 976,246 | |||||||
The accompanying notes are an integral part of these financial statements.
16
PLUMB FUNDS
Plumb Balanced Fund
Schedule of Investments – March 31, 2011 (Continued)
| Principal | ||||||||
| Amount | Value | |||||||
| MUNICIPAL BONDS – 0.50% | ||||||||
| West Virginia State Job Investment Trust Board | ||||||||
| 0.000%, 06/12/2013 | $ | 250,000 | $ | 225,087 | ||||
| TOTAL MUNICIPAL BONDS | ||||||||
| (Cost $229,266) | 225,087 | |||||||
| Contracts | ||||||||
| CALL OPTIONS PURCHASED – 0.57% | ||||||||
| Computer and Electronic Product Manufacturing – 0.57% | ||||||||
| QUALCOMM, Inc. | ||||||||
| Expiration: 01/19/2013, Exercise Price $30 (a) | 100 | 256,250 | ||||||
| TOTAL CALL OPTIONS PURCHASED | ||||||||
| (Cost $231,531) | 256,250 | |||||||
| Shares | ||||||||
| SHORT-TERM INVESTMENTS – 1.72% | ||||||||
| Money Market Funds – 1.72% | ||||||||
| STIT-STIC Prime Portfolio 0.12% (c) | 765,865 | 765,865 | ||||||
| TOTAL SHORT-TERM INVESTMENTS | ||||||||
| (Cost $765,865) | 765,865 | |||||||
| Total Investments | ||||||||
| (Cost $39,120,520) – 99.57% | 44,434,484 | |||||||
| Other Assets in Excess of Liabilities – 0.43% | 191,058 | |||||||
| TOTAL NET ASSETS – 100.00% | $ | 44,625,542 | ||||||
Percentages are stated as a percent of net assets.
ADR – American Depository Receipt
| (a) | Non-income producing security. |
| (b) | Foreign issued security. Total foreign concentration was as follows: Cayman Islands 2.13%, Switzerland 3.94%. |
| (c) | Variable rate security. The rate listed is as of March 31, 2011. |
The accompanying notes are an integral part of these financial statements.
17
PLUMB FUNDS
Plumb Equity Fund
Schedule of Investments – March 31, 2011
| Shares | Value | |||||||
| COMMON STOCKS – 88.37% | ||||||||
| Beverage and Tobacco Product Manufacturing – 3.35% | ||||||||
| PepsiCo, Inc. | 9,000 | $ | 579,690 | |||||
| Chemical Manufacturing – 10.33% | ||||||||
| Abbott Laboratories | 9,800 | 480,690 | ||||||
| Air Products & Chemicals, Inc. | 4,500 | 405,810 | ||||||
| Church & Dwight Company, Inc. | 4,000 | 317,360 | ||||||
| Procter & Gamble Company | 3,000 | 184,800 | ||||||
| Teva Pharmaceutical Industries Ltd. – ADR | 8,000 | 401,360 | ||||||
| 1,790,020 | ||||||||
| Computer and Electronic | ||||||||
| Product Manufacturing – 7.42% | ||||||||
| Apple, Inc. (a) | 1,450 | 505,252 | ||||||
| Cisco Systems, Inc. | 15,000 | 257,250 | ||||||
| Microchip Technology, Inc. | 8,000 | 304,080 | ||||||
| QUALCOMM, Inc. | 4,000 | 219,320 | ||||||
| 1,285,902 | ||||||||
| Couriers and Messengers – 1.50% | ||||||||
| United Parcel Service, Inc. – Class B | 3,500 | 260,120 | ||||||
| Credit Intermediation and Related Activities – 9.22% | ||||||||
| CIT Group, Inc. (a) | 6,000 | 255,300 | ||||||
| Citigroup, Inc. | 65,000 | 287,300 | ||||||
| Discover Financial Services | 20,800 | 501,696 | ||||||
| Visa, Inc. – Class A | 7,500 | 552,150 | ||||||
| 1,596,446 | ||||||||
| Electrical Equipment, Appliance, and | ||||||||
| Component Manufacturing – 2.36% | ||||||||
| Emerson Electric Company | 7,000 | 409,010 | ||||||
| Food Manufacturing – 1.77% | ||||||||
| Unilever PLC – ADR | 10,000 | 306,200 | ||||||
| Food Services and Drinking Places – 1.76% | ||||||||
| McDonald’s Corporation | 4,000 | 304,360 | ||||||
| General Merchandise Stores – 1.84% | ||||||||
| Kohl’s Corporation | 6,000 | 318,240 | ||||||
The accompanying notes are an integral part of these financial statements.
18
PLUMB FUNDS
Plumb Equity Fund
Schedule of Investments – March 31, 2011 (Continued)
| Shares | Value | |||||||
| COMMON STOCKS (Continued) | ||||||||
| Health and Personal Care Stores – 2.38% | ||||||||
| CVS Caremark Corporation | 12,000 | $ | 411,840 | |||||
| Insurance Carriers and Related Activities – 1.30% | ||||||||
| Greenlight Capital Re, Ltd. – Class A (a) (b) | 8,000 | 225,680 | ||||||
| Internet Service Providers, Web Search Portals – 2.07% | ||||||||
| Automatic Data Processing, Inc. | 7,000 | 359,170 | ||||||
| Management of Companies and Enterprises – 4.15% | ||||||||
| Foster Wheeler AG (a) (b) | 10,700 | 402,534 | ||||||
| The Goldman Sachs Group, Inc. | 2,000 | 316,940 | ||||||
| 719,474 | ||||||||
| Merchant Wholesalers, Nondurable Goods – 0.51% | ||||||||
| Alliance One International, Inc. (a) | 22,000 | 88,440 | ||||||
| Mining (except Oil and Gas) – 1.58% | ||||||||
| Newmont Mining Corporation | 5,000 | 272,900 | ||||||
| Miscellaneous Manufacturing – 2.97% | ||||||||
| 3M Co | 4,000 | 374,000 | ||||||
| CareFusion Corporation (a) | 5,000 | 141,000 | ||||||
| 515,000 | ||||||||
| Motor Vehicle and Parts Dealers – 1.21% | ||||||||
| Sonic Automotive, Inc. – Class A | 15,000 | 210,150 | ||||||
| Oil and Gas Extraction – 3.12% | ||||||||
| ATP Oil & Gas Corporation (a) | 18,700 | 338,657 | ||||||
| Petroleo Brasileiro S.A. – ADR | 5,000 | 202,150 | ||||||
| 540,807 | ||||||||
| Petroleum and Coal Products Manufacturing – 7.80% | ||||||||
| BP PLC – ADR | 10,000 | 441,400 | ||||||
| Chevron Corporation | 4,000 | 429,720 | ||||||
| ConocoPhillips | 6,000 | 479,160 | ||||||
| 1,350,280 | ||||||||
| Primary Metal Manufacturing – 2.70% | ||||||||
| RTI International Metals, Inc. (a) | 15,000 | 467,250 | ||||||
The accompanying notes are an integral part of these financial statements.
19
PLUMB FUNDS
Plumb Equity Fund
Schedule of Investments – March 31, 2011 (Continued)
| Shares | Value | |||||||
| COMMON STOCKS (Continued) | ||||||||
| Professional, Scientific, and Technical Services – 4.39% | ||||||||
| Global Geophysical Services, Inc. (a) | 30,000 | $ | 433,800 | |||||
| MasterCard, Inc. – Class A | 1,300 | 327,236 | ||||||
| 761,036 | ||||||||
| Publishing Industries – 3.62% | ||||||||
| BMC Software, Inc. (a) | 7,000 | 348,180 | ||||||
| Symantec Corporation (a) | 15,000 | 278,100 | ||||||
| 626,280 | ||||||||
| Support Activities for Mining – 4.48% | ||||||||
| Atwood Oceanics, Inc. (a) | 6,000 | 278,580 | ||||||
| Weatherford International Ltd. (a) (b) | 22,000 | 497,200 | ||||||
| 775,780 | ||||||||
| Telecommunications – 2.82% | ||||||||
| Vodafone Group PLC – ADR | 17,000 | 488,750 | ||||||
| Transportation Equipment Manufacturing – 3.71% | ||||||||
| Ford Motor Company (a) | 22,200 | 331,002 | ||||||
| Visteon Corporation (a) | 5,000 | 312,450 | ||||||
| 643,452 | ||||||||
| TOTAL COMMON STOCKS | ||||||||
| (Cost $12,726,642) | 15,306,277 | |||||||
| PUBLICLY-TRADED PARTNERSHIPS – 1.92% | ||||||||
| Real Estate – 1.92% | ||||||||
| Penn Virginia Resources Partners, L.P. | 12,000 | 332,400 | ||||||
| TOTAL PUBLICLY-TRADED PARTNERSHIPS | ||||||||
| (Cost $318,192) | 332,400 | |||||||
| EXCHANGE-TRADED FUNDS – 3.81% | ||||||||
| Funds, Trusts, and Other Financial Vehicles – 3.00% | ||||||||
| iShares MSCI South Korea Index Fund | 3,000 | 193,050 | ||||||
| iShares Silver Trust (a) | 4,000 | 147,160 | ||||||
| Market Vectors Gold Miners ETF | 3,000 | 180,180 | ||||||
| 520,390 | ||||||||
The accompanying notes are an integral part of these financial statements.
20
PLUMB FUNDS
Plumb Equity Fund
Schedule of Investments – March 31, 2011 (Continued)
| Shares | Value | |||||||
| EXCHANGE-TRADED FUNDS (Continued) | ||||||||
| Securities, Commodity Contracts, and Other | ||||||||
| Financial Investments and Related Activities – 0.81% | ||||||||
| SPDR Gold Trust (a) | 1,000 | $ | 139,820 | |||||
| TOTAL EXCHANGE-TRADED FUNDS | ||||||||
| (Cost $509,954) | 660,210 | |||||||
| Contracts | ||||||||
| CALL OPTIONS PURCHASED – 2.76% | ||||||||
| Computer and Electronic | ||||||||
| Product Manufacturing – 1.48% | ||||||||
| QUALCOMM, Inc. | ||||||||
| Expiration: 01/19/2013, Exercise Price $30 (a) | 100 | 256,250 | ||||||
| Educational Services – 0.35% | ||||||||
| Corinthian Colleges, Inc. | ||||||||
| Expiration: 01/21/2012, Exercise Price $2.50 (a) | 301 | 60,802 | ||||||
| Oil and Gas Extraction – 0.93% | ||||||||
| Petroleo Brasileiro S.A. – ADR | ||||||||
| Expiration: 01/19/2013, Exercise Price $25 (a) | 100 | 161,250 | ||||||
| TOTAL CALL OPTIONS PURCHASED | ||||||||
| (Cost $452,236) | 478,302 | |||||||
| Shares | ||||||||
| SHORT-TERM INVESTMENTS – 2.42% | ||||||||
| Money Market Funds – 2.42% | ||||||||
| STIT-STIC Prime Portfolio 0.12% (c) | 419,494 | 419,494 | ||||||
| TOTAL SHORT-TERM INVESTMENTS | ||||||||
| (Cost $419,494) | 419,494 | |||||||
| Total Investments | ||||||||
| (Cost $14,426,518) – 99.28% | 17,196,683 | |||||||
| Other Assets in Excess of Liabilities – 0.72% | 125,086 | |||||||
| TOTAL NET ASSETS – 100.00% | $ | 17,321,769 | ||||||
Percentages are stated as a percent of net assets.
ADR – American Depository Receipt
| (a) | Non-income producing security. |
| (b) | Foreign issued security. Total foreign concentration was as follows: Cayman Islands 1.30%, Switzerland 5.19%. |
| (c) | Variable rate security. The rate listed is as of March 31, 2011. |
The accompanying notes are an integral part of these financial statements.
21
PLUMB FUNDS
Statements of Assets and Liabilities
March 31, 2011
| Plumb | Plumb | |||||||
| Balanced | Equity | |||||||
| Fund | Fund | |||||||
| Assets | ||||||||
| Investments, at value* | $ | 44,434,484 | $ | 17,196,683 | ||||
| Dividends and interest receivable | 144,311 | 7,966 | ||||||
| Receivable for investments sold | 339,332 | 185,680 | ||||||
| Receivable for fund shares sold | 89,100 | 60,000 | ||||||
| Prepaid assets | 19,525 | 9,807 | ||||||
| Total Assets | 45,026,752 | 17,460,136 | ||||||
| Liabilities | ||||||||
| Payable for investments purchased | 310,995 | — | ||||||
| Payable for fund shares redeemed | 13,418 | 106,132 | ||||||
| Accrued distribution fee | 8,429 | 1,666 | ||||||
| Payable to Advisor (a) | 18,221 | 5,792 | ||||||
| Administrative & accounting services fee payable (a) | 7,461 | 2,929 | ||||||
| Accrued expenses and other liabilities | 42,686 | 21,848 | ||||||
| Total Liabilities | 401,210 | 138,367 | ||||||
| Net Assets | $ | 44,625,542 | $ | 17,321,769 | ||||
| Net Assets Consist Of: | ||||||||
| Paid in capital | 52,995,592 | 20,244,175 | ||||||
| Accumulated net investment income | 166,897 | 1,263 | ||||||
| Accumulated net realized loss | (13,850,911 | ) | (5,693,834 | ) | ||||
| Net unrealized appreciation on investments | 5,313,964 | 2,770,165 | ||||||
| Net Assets | $ | 44,625,542 | $ | 17,321,769 | ||||
| Capital shares outstanding, $0.001 par value | ||||||||
| (200 million shares issued each) | 2,504,645 | 986,380 | ||||||
| Net asset value, offering and | ||||||||
| redemption price per share | $ | 17.82 | $ | 17.56 | ||||
| * Cost of Investments | $ | 39,120,520 | $ | 14,426,518 | ||||
| (a) | See Note 4 in the Notes to Financial Statements. |
The accompanying notes are an integral part of these financial statements.
22
PLUMB FUNDS
Statements of Operations
For the Fiscal Year Ended March 31, 2011
| Plumb | Plumb | |||||||
| Balanced | Equity | |||||||
| Fund | Fund | |||||||
| Investment Income: | ||||||||
| Dividends (Net of foreign withholding | ||||||||
| taxes of $5,291 and $2,507, respectively) | $ | 710,583 | $ | 282,325 | ||||
| Interest | 564,930 | 461 | ||||||
| Total Investment Income | 1,275,513 | 282,786 | ||||||
| Expenses: | ||||||||
| Investment Advisor’s fee (a) | 276,569 | 101,547 | ||||||
| Distribution fees | 106,373 | 39,056 | ||||||
| Administrative & accounting service fees (a) | 76,210 | 28,226 | ||||||
| Legal fees | 44,729 | 15,749 | ||||||
| Administration fee | 24,225 | 20,352 | ||||||
| Transfer agent fees and expenses | 29,869 | 19,679 | ||||||
| Fund accounting fees | 31,114 | 26,940 | ||||||
| Registration fees | 12,276 | 8,953 | ||||||
| Trustee fees and expenses | 21,476 | 7,228 | ||||||
| Audit and tax fees | 15,987 | 7,026 | ||||||
| Custody fees | 8,650 | 8,850 | ||||||
| Insurance expense | 11,675 | 3,645 | ||||||
| Printing and mailing expense | 3,968 | 2,168 | ||||||
| Other expenses | 360 | 170 | ||||||
| Total expenses before waiver | 663,481 | 289,589 | ||||||
| Less: Fees waived/reimbursed by Advisor (a) | (147,474 | ) | (77,943 | ) | ||||
| Net expenses | 516,007 | 211,646 | ||||||
| Net Investment Income | 759,506 | 71,140 | ||||||
| Realized and Unrealized Gain: | ||||||||
| Net realized gain on investments | 2,162,222 | 1,069,650 | ||||||
| Net change in unrealized appreciation: | ||||||||
| Investments | 1,251,314 | 820,937 | ||||||
| Options | 24,719 | 26,066 | ||||||
| Net realized and unrealized | ||||||||
| gain on investments | 3,438,255 | 1,916,653 | ||||||
| Net Increase in Net Assets | ||||||||
| Resulting from Operations | $ | 4,197,761 | $ | 1,987,793 | ||||
| (a) | See Note 4 in the Notes to the Financial Statements. |
The accompanying notes are an integral part of these financial statements.
23
PLUMB FUNDS
Plumb Balanced Fund
Statement of Changes in Net Assets
| For the | For the | |||||||
| Year Ended | Year Ended | |||||||
| March 31, | March 31, | |||||||
| 2011 | 2010 | |||||||
| Operations: | ||||||||
| Net investment income | $ | 759,506 | $ | 887,923 | ||||
| Net realized gain (loss) on investments | 2,162,222 | (772,096 | ) | |||||
| Net change in unrealized appreciation | ||||||||
| on investments and options | 1,276,033 | 10,987,208 | ||||||
| Net increase in net assets | ||||||||
| resulting from operations | 4,197,761 | 11,103,035 | ||||||
| Dividends And Distributions To Shareholders: | ||||||||
| Net investment income | (895,239 | ) | (934,405 | ) | ||||
| Total dividends and distributions | (895,239 | ) | (934,405 | ) | ||||
| Capital Share Transactions: | ||||||||
| Proceeds from shares sold | 4,378,229 | 3,367,649 | ||||||
| Shares issued in reinvestment of dividends | 424,112 | 391,602 | ||||||
| Cost of shares redeemed | (7,955,658 | ) | (4,205,291 | ) | ||||
| Net decrease in net assets | ||||||||
| from capital share transactions | (3,153,317 | ) | (446,040 | ) | ||||
| Total increase in net assets | 149,205 | 9,722,590 | ||||||
| Net Assets: | ||||||||
| Beginning of year | 44,476,337 | 34,753,747 | ||||||
| End of year* | $ | 44,625,542 | $ | 44,476,337 | ||||
| * Including undistributed net | ||||||||
| investment income of | $ | 166,897 | $ | 193,268 | ||||
| Change In Shares Outstanding: | ||||||||
| Shares sold | 256,862 | 222,104 | ||||||
| Shares issued in reinvestment of dividends | 24,777 | 24,785 | ||||||
| Shares redeemed | (483,555 | ) | (273,460 | ) | ||||
| Net decrease | (201,916 | ) | (26,571 | ) | ||||
The accompanying notes are an integral part of these financial statements.
24
PLUMB FUNDS
Plumb Equity Fund
Statement of Changes in Net Assets
| For the | For the | |||||||
| Year Ended | Year Ended | |||||||
| March 31, | March 31, | |||||||
| 2011 | 2010 | |||||||
| Operations: | ||||||||
| Net investment income | $ | 71,140 | $ | 133,141 | ||||
| Net realized gain on investments | 1,069,650 | 7,212 | ||||||
| Net change in unrealized appreciation | ||||||||
| on investments and options | 847,003 | 4,309,637 | ||||||
| Net increase in net assets | ||||||||
| resulting from operations | 1,987,793 | 4,449,990 | ||||||
| Dividends And Distributions To Shareholders: | ||||||||
| Net investment income | (120,439 | ) | (140,237 | ) | ||||
| Total dividends and distributions | (120,439 | ) | (140,237 | ) | ||||
| Capital Share Transactions: | ||||||||
| Proceeds from shares sold | 3,808,024 | 2,655,244 | ||||||
| Shares issued in reinvestment of dividends | 57,540 | 82,314 | ||||||
| Cost of shares redeemed | (3,817,351 | ) | (2,474,276 | ) | ||||
| Net increase in net assets | ||||||||
| from capital share transactions | 48,213 | 263,282 | ||||||
| Total increase in net assets | 1,915,567 | 4,573,035 | ||||||
| Net Assets: | ||||||||
| Beginning of year | 15,406,202 | 10,833,167 | ||||||
| End of year* | $ | 17,321,769 | $ | 15,406,202 | ||||
| * Including undistributed net | ||||||||
| investment income of | $ | 1,263 | $ | 24,543 | ||||
| Change In Shares Outstanding: | ||||||||
| Shares sold | 241,514 | 187,940 | ||||||
| Shares issued in reinvestment of dividends | 3,438 | 5,477 | ||||||
| Shares redeemed | (236,738 | ) | (173,111 | ) | ||||
| Net increase | 8,214 | 20,306 | ||||||
The accompanying notes are an integral part of these financial statements.
25
PLUMB FUNDS
Plumb Balanced Fund
Financial Highlights
| For the Period | ||||||||||||||||
| For the | May 24, 2007* | |||||||||||||||
| Years Ended | through | |||||||||||||||
| March 31, | March 31, | |||||||||||||||
| 2011 | 2010 | 2009 | 2008 | |||||||||||||
| Per share operating performance | ||||||||||||||||
| (For a share outstanding throughout the period) | ||||||||||||||||
| Net asset value, | ||||||||||||||||
| beginning of period | $ | 16.43 | $ | 12.72 | $ | 17.52 | $ | 20.00 | ||||||||
| Operations: | ||||||||||||||||
Net investment income(1) | 0.31 | 0.33 | 0.37 | 0.28 | ||||||||||||
| Net realized and | ||||||||||||||||
| unrealized gain (loss) | 1.44 | 3.73 | (4.80 | ) | (2.55 | ) | ||||||||||
| Total from investment operations | 1.75 | 4.06 | (4.43 | ) | (2.27 | ) | ||||||||||
| Dividends and distributions | ||||||||||||||||
| to shareholders: | ||||||||||||||||
| Dividends from net | ||||||||||||||||
| investment income | (0.36 | ) | (0.35 | ) | (0.37 | ) | (0.21 | ) | ||||||||
| Total dividends and distributions | (0.36 | ) | (0.35 | ) | (0.37 | ) | (0.21 | ) | ||||||||
| Change in net asset | ||||||||||||||||
| value for the period | 1.39 | 3.71 | (4.80 | ) | (2.48 | ) | ||||||||||
| Net asset value, | ||||||||||||||||
| end of period | $ | 17.82 | $ | 16.43 | $ | 12.72 | $ | 17.52 | ||||||||
Total return(4) | 10.76 | % | 32.01 | % | (25.33 | )% | (11.44 | )%(2) | ||||||||
The accompanying notes are an integral part of these financial statements.
26
PLUMB FUNDS
Plumb Balanced Fund
Financial Highlights (Continued)
| For the Period | ||||||||||||||||
| For the | May 24, 2007* | |||||||||||||||
| Years Ended | through | |||||||||||||||
| March 31, | March 31, | |||||||||||||||
| 2011 | 2010 | 2009 | 2008 | |||||||||||||
| Ratios/supplemental data | ||||||||||||||||
| Net assets, end of period (000) | $ | 44,626 | $ | 44,476 | $ | 34,754 | $ | 55,701 | ||||||||
| Ratio of net expenses | ||||||||||||||||
| to average net assets: | ||||||||||||||||
| Before expense | ||||||||||||||||
| reimbursement and waivers | 1.56 | % | 1.64 | % | 1.57 | % | 1.56 | %(3) | ||||||||
| After expense | ||||||||||||||||
reimbursement and waivers(5) | 1.21 | % | 1.10 | % | 1.10 | % | 1.10 | %(3) | ||||||||
| Ratio of net investment income | ||||||||||||||||
| to average net assets: | ||||||||||||||||
| After expense | ||||||||||||||||
reimbursement and waivers(5) | 1.79 | % | 2.15 | % | 2.19 | % | 1.78 | %(3) | ||||||||
| Portfolio turnover rate | 85 | % | 54 | % | 63 | % | 51 | %(2) | ||||||||
| * | Commencement of operations. |
| (1) | Net investment income per share is calculated using ending balances prior to consideration of adjustment for permanent book and tax differences. |
| (2) | Not annualized. |
| (3) | Annualized. |
| (4) | Total return represents the rate that the investor would have earned or lost on an investment in the Fund, assuming reinvestment of dividends. |
| (5) | Effective July 1, 2010, the Advisor contractually agreed to cap the Fund’s expenses at 1.25%. Prior to July 1, 2010, the Fund’s expense cap was 1.10%. |
The accompanying notes are an integral part of these financial statements.
27
PLUMB FUNDS
Plumb Equity Fund
Financial Highlights
| For the Period | ||||||||||||||||
| For the | May 24, 2007* | |||||||||||||||
| Years Ended | through | |||||||||||||||
| March 31, | March 31, | |||||||||||||||
| 2011 | 2010 | 2009 | 2008 | |||||||||||||
| Per share operating performance | ||||||||||||||||
| (For a share outstanding throughout the period) | ||||||||||||||||
| Net asset value, | ||||||||||||||||
| beginning of period | $ | 15.75 | $ | 11.31 | $ | 16.49 | $ | 20.00 | ||||||||
| Operations: | ||||||||||||||||
Net investment income(1) | 0.07 | 0.14 | 0.10 | 0.08 | ||||||||||||
| Net realized and | ||||||||||||||||
| unrealized gain (loss) | 1.86 | 4.45 | (5.17 | ) | (3.50 | ) | ||||||||||
| Total from investment operations | 1.93 | 4.59 | (5.07 | ) | (3.42 | ) | ||||||||||
| Dividends and distributions | ||||||||||||||||
| to shareholders: | ||||||||||||||||
| Dividends from net | ||||||||||||||||
| investment income | (0.12 | ) | (0.15 | ) | (0.11 | ) | (0.09 | ) | ||||||||
| Total dividends and distributions | (0.12 | ) | (0.15 | ) | (0.11 | ) | (0.09 | ) | ||||||||
| Change in net asset | ||||||||||||||||
| value for the period | 1.81 | 4.44 | (5.18 | ) | (3.51 | ) | ||||||||||
| Net asset value, end of period | $ | 17.56 | $ | 15.75 | $ | 11.31 | $ | 16.49 | ||||||||
Total return(4) | 12.31 | % | 40.66 | % | (30.81 | )% | (17.14 | )%(2) | ||||||||
The accompanying notes are an integral part of these financial statements.
28
PLUMB FUNDS
Plumb Equity Fund
Financial Highlights (Continued)
| For the Period | ||||||||||||||||
| For the | May 24, 2007* | |||||||||||||||
| Years Ended | through | |||||||||||||||
| March 31, | March 31, | |||||||||||||||
| 2011 | 2010 | 2009 | 2008 | |||||||||||||
| Ratios/supplemental data | ||||||||||||||||
| Net assets, end of period (000) | $ | 17,322 | $ | 15,406 | $ | 10,883 | $ | 17,629 | ||||||||
| Ratio of net expenses | ||||||||||||||||
| to average net assets: | ||||||||||||||||
| Before expense | ||||||||||||||||
| reimbursement and waivers | 1.85 | % | 2.18 | % | 2.14 | % | 2.10 | %(3) | ||||||||
| After expense | ||||||||||||||||
reimbursement and waivers(5) | 1.35 | % | 1.20 | % | 1.20 | % | 1.20 | %(3) | ||||||||
| Ratio of net investment income | ||||||||||||||||
| to average net assets: | ||||||||||||||||
| After expense | ||||||||||||||||
reimbursement and waivers(5) | 0.46 | % | 0.98 | % | 0.65 | % | 0.56 | %(3) | ||||||||
| Portfolio turnover rate | 111 | % | 73 | % | 83 | % | 67 | %(2) | ||||||||
| * | Commencement of operations. |
| (1) | Net investment income per share is calculated using ending balances prior to consideration of adjustment for permanent book and tax differences. |
| (2) | Not annualized. |
| (3) | Annualized. |
| (4) | Total return represents the rate that the investor would have earned or lost on an investment in the Fund, assuming reinvestment of dividends. |
| (5) | Effective July 1, 2010, the Advisor contractually agreed to cap the Fund’s expenses at 1.40%. Prior to July 1, 2010, the Fund’s expense cap was 1.20%. |
The accompanying notes are an integral part of these financial statements.
29
PLUMB FUNDS
Notes to Financial Statements
March 31, 2011
1.ORGANIZATION
Wisconsin Capital Funds, Inc. (the “Company”) is registered under the Investment Company Act of 1940 (the “1940 Act”) as an open-end, diversified management investment company. The Company was organized as a Maryland corporation on April 3, 2007. The Company is authorized to issue up to 2 billion shares, which are units of beneficial interest with a $0.001 par value. The Company currently offers shares of two series, each with its own investment strategy and risk/reward profile: the Plumb Balanced Fund and the Plumb Equity Fund (individually a “Fund”, collectively the “Funds”). The investment objective of the Plumb Balanced Fund is high total return through capital appreciation while attempting to preserve principal, with current income as a secondary objective. The investment objective of the Plumb Equity Fund is long-term capital appreciation. Wisconsin Capital Management, LLC (the “Advisor”) serves as the Funds’ investment advisor. On February 28, 2011, the indirect parent of the Advisor combined with SVA Wealth Management, Inc. and related entities to form SVA Plumb Financial, LLC. Notwithstanding the merger, the Advisor continues to be controlled by Thomas G. Plumb indirectly through TGP, Inc., and no new person or entity controls the Advisor. The merger did not result in any change in the portfolio managers or other personnel of the Advisor who are responsible for the Funds’ operations or in the business operations of the Funds or the Advisor.
2.SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently followed by the Funds in the preparation of its financial statements. These policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”).
Security Valuation:
The Funds have adopted authoritative fair valuation accounting standards which establish an authoritative definition of fair value and set out a hierarchy for measuring fair value. These standards require additional disclosures about the various inputs and valuation techniques used to develop the measurements of fair value and a discussion in changes in valuation techniques and related inputs during the year. These inputs are summarized in the three broad levels listed below.
| Level 1 – | quoted prices in active markets for identical securities | |
| Level 2 – | other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.) | |
| Level 3 – | significant unobservable inputs (including the Funds’ own assumptions in determining fair value of investments) |
30
PLUMB FUNDS
Notes to Financial Statements
March 31, 2011 (Continued)
Equity securities, including common stocks, publicly-traded partnerships, foreign issued common stocks, preferred securities, exchange-traded funds, and real estate investment trusts, which are traded on an exchange are valued at the last sale price reported by the exchange on which the securities are primarily traded on the day of valuation. Nasdaq-listed securities are valued at their Nasdaq Official Closing Price. Equity securities not traded on a listed exchange or not traded using Nasdaq are valued at the last sale price at the close of the U.S. market. If there are no sales on a given day for securities traded on an exchange, the latest bid quotation will be used.
An option that is purchased by the Funds is generally valued at the last sale price or, in the absence of the last sale price, the average of the quoted bid and asked prices. If an options exchange closes after the time at which the Funds’ net asset value is calculated, snapshot prices are provided by the independent pricing services or other sources at the close of the New York Stock Exchange to calculate the net asset value.
When using the market quotations or closing price provided by a pricing service and when the market is considered active, the security will be classified as a Level 1 security. Listed options for which no sale was reported on that date are valued at their evaluated mean prices as furnished by the independent pricing services and generally will be classified as a Level 2 security. These securities are typically valued using market observable data such as broker quotes, bid and ask offers, and market quotes for the underlying equities.
Investments in mutual funds, including money market funds, are generally priced at the ending net asset value (NAV) provided by the service agent of the Funds and will be classified as Level 1 securities.
Debt securities, such as corporate bonds, convertible bonds, municipal bonds, and U.S. government agency issues are valued using a market approach based on information supplied by independent pricing services, including services using matrix pricing formulas as well as market transactions and/or independent broker bid quotations. The significant inputs of these matrix pricing formulas include coupons, ratings, maturities, and other fundamental data relating to the issuer. Debt securities with remaining maturities of 60 days or less may be valued on an amortized cost basis, which involves valuing an instrument at its cost and thereafter assuming a constant amortization to maturity of any discount or premium, regardless of the impact of fluctuating rates on the fair value of the instrument. To the extent the inputs are observable and timely, these debt securities will generally be classified as Level 2 securities.
Any securities or other assets for which market quotations are not readily available are valued at fair value as determined in good faith by the Advisor pursuant to procedures established under the general supervision and
31
PLUMB FUNDS
Notes to Financial Statements
March 31, 2011 (Continued)
responsibility of the Funds’ Board of Directors and will be classified as Level 3 securities.
The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety is determined based on the lowest level input that is significant to the fair value measurement in its entirety.
The following is a summary of the inputs used, as of March 31, 2011, to value the Funds’ investments carried at fair value:
| Description | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| The Plumb Balanced Fund | ||||||||||||||||
| Investments in: | ||||||||||||||||
| Common Stock* | $ | 29,569,903 | $ | — | $ | — | $ | 29,569,903 | ||||||||
| Publicly-Traded | ||||||||||||||||
| Partnerships* | 609,400 | — | — | 609,400 | ||||||||||||
| Preferred Securities* | 797,350 | — | — | 797,350 | ||||||||||||
| Exchange-Traded Funds* | 286,980 | — | — | 286,980 | ||||||||||||
| Convertible Bonds* | — | 1,526,188 | — | 1,526,188 | ||||||||||||
| Corporate Bonds* | — | 9,421,215 | — | 9,421,215 | ||||||||||||
| U.S. Government | ||||||||||||||||
| Agency Issues | — | 976,246 | — | 976,246 | ||||||||||||
| Municipal Bonds | — | 225,087 | — | 225,087 | ||||||||||||
| Purchased Options* | — | 256,250 | — | 256,250 | ||||||||||||
| Money Market Funds | 765,865 | — | — | 765,865 | ||||||||||||
| Total | $ | 32,029,498 | $ | 12,404,986 | $ | — | $ | 44,434,484 | ||||||||
| Description | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| The Plumb Equity Fund | ||||||||||||||||
| Investments in: | ||||||||||||||||
| Common Stock* | $ | 15,306,277 | $ | — | $ | — | $ | 15,306,277 | ||||||||
| Publicly-Traded Partnerships* | 332,400 | — | — | 332,400 | ||||||||||||
| Exchange-Traded Funds* | 660,210 | — | — | 660,210 | ||||||||||||
| Purchased Options* | 60,802 | 417,500 | — | 478,302 | ||||||||||||
| Money Market Funds | 419,494 | — | — | 419,494 | ||||||||||||
| Total | $ | 16,779,183 | $ | 417,500 | $ | — | $ | 17,196,683 | ||||||||
*For detailed industry descriptions, refer to the Schedule of Investments.
The Funds did not hold any investments during the period with significant unobservable inputs which would be classified as Level 3. As of and during the
32
PLUMB FUNDS
Notes to Financial Statements
March 31, 2011 (Continued)
year ended March 31, 2011, no securities were transferred into or out of Level 1 or Level 2. It is the Funds’ policy to consider transfers into or out of Level 1 and Level 2 as of the end of the reporting period.
Use of Estimates:
The presentation of the financial statements in conformity with 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.
Expenses:
Expenses directly attributable to a Fund are charged to the Fund, while expenses attributable to more than one series of the Company are allocated among the respective series based on relative net assets or another appropriate basis.
Federal Income Taxes:
The Funds intend to meet the requirements of the Internal Revenue Code (the “Code”) applicable to regulated investment companies and to distribute substantially all net investment taxable income and net capital gains to shareholders in a manner which results in no tax cost to the Funds. Therefore, no federal income or excise tax provision is recorded.
As of and during the year ended March 31, 2011, the Funds did not have a liability for any unrecognized tax benefits. The Funds recognize interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the Statement of Operations. During the year ended March 31, 2011, the Funds did not incur any interest or penalties. The Funds are not subject to examination by U.S. taxing authorities for tax years prior to 2007.
Distributions to Shareholders:
Dividends from net investment income are declared and paid at least annually. Distributions of net realized capital gains, if any, will be declared and paid at least annually. Distributions to shareholders are recorded on the ex-dividend date.
The Funds may periodically make reclassifications among certain of its capital accounts as a result of the recognition and characterization of certain income and capital gain distributions determined annually in accordance with federal tax regulations which may differ from GAAP. Any such reclassifications will have no effect on net assets, results of operations or net asset values per share of the Funds.
33
PLUMB FUNDS
Notes to Financial Statements
March 31, 2011 (Continued)
For the fiscal year ended March 31, 2011, the Funds made the following reclassifications to increase (decrease) the components of net assets:
| Accumulated Net | Accumulated Net | ||
| Paid In Capital | Investment Income | Realized Loss | |
| Plumb Balanced Fund | $ — | $109,362 | $(109,362) |
| Plumb Equity Fund | $(27,300) | $ 26,019 | $ 1,281 |
Options:
Each of the Funds may purchase call or put options on securities and indices and enter into related closing transactions. Each of the Funds may engage in transactions in options either for bona fide hedging purposes or to seek to increase total return. During the year ended March 31, 2011, the Funds invested in purchased call options in an attempt to achieve increased total returns. As a holder of a call option, a Fund pays a non-refundable premium to the seller for the right, but not the obligation, to purchase a security at a fixed price (the exercise price) during the specified period (exercise period). As a holder of a put option, a Fund pays a non-refundable premium for the right, but not the obligation, to sell a security at the exercise price during the exercise period. The premium that a Fund pays when purchasing a call option will reflect, among other things, the market price of the security, the relationship of the exercise price to the market price of the security, the relationship of the exercise price to the volatility of the security, the length of the option period and supply and demand factors.
The counterparty risk associated with purchased options is minimal because the options are exchange-traded, and the Options Clearing Corporation guarantees performance to selling and purchasing clearing members.
If a purchased call option is exercised by a Fund, the premium is added to the cost basis of the security purchased, which will subsequently decrease the gain or increase the loss recognized at the time of sale. If a purchased put option is exercised by the Fund, the premium is deducted from the proceeds of the sale of the underlying security in determining whether the Fund has realized a gain or loss.
The Plumb Balanced and Plumb Equity Funds’ derivative instruments at March 31, 2011 consisted solely of purchased options–equity contracts. The balance sheet location and fair value of these purchased options at March 31, 2011 were as follows:
| Location on | ||
| Statements of | Fair | |
| Fund | Assets and Liabilities | Value |
| Plumb Balanced Fund | Investments, at value | $256,250 |
| Plumb Equity Fund | Investments, at value | $478,302 |
34
PLUMB FUNDS
Notes to Financial Statements
March 31, 2011 (Continued)
The Plumb Balanced and Plumb Equity Funds did not have any realized gains or losses on derivatives for the year ended March 31, 2011. The effect of equity contract derivative instruments on the Statements of Operations for the year ended March 31, 2011 was as follows:
| Change in Unrealized | ||
| Location of Gain on | Appreciation on | |
| Purchased Options | Purchased Options | |
| Recognized in Statements | Recognized in Statements | |
| Fund | of Operations | of Operations |
| Plumb Balanced Fund | Net change in unrealized | |
| appreciation: Options | $24,719 | |
| Plumb Equity Fund | Net change in unrealized | |
| appreciation: Options | $26,066 |
The option contract activity during the year ended March 31, 2011 was as follows:
| Plumb Balanced Fund | Plumb Equity Fund | |||||||||||||||
| Number of | Premiums | Number of | Premiums | |||||||||||||
| Contracts | Paid | Contracts | Paid | |||||||||||||
| Options outstanding, | ||||||||||||||||
| beginning of year | — | $ | — | — | $ | — | ||||||||||
| Options purchased | 100 | 231,531 | 501 | 452,236 | ||||||||||||
| Options expired | — | — | — | — | ||||||||||||
| Options sold | — | — | — | — | ||||||||||||
| Options outstanding, | ||||||||||||||||
| end of year | 100 | $ | 231,531 | 501 | $ | 452,236 | ||||||||||
Other:
Investment and shareholder transactions are recorded on the trade date. Gains or losses from investment transactions are determined using the specific identification method. Dividend income is recognized on the ex-dividend date and interest income is recognized on an accrual basis. Discounts and premiums on securities purchased are amortized using the effective interest method. Withholding taxes on foreign dividends have been provided for in accordance with the Funds’ understanding of the applicable country’s tax rules and rates.
3.DISTRIBUTION PLAN
The Company has adopted a plan pursuant to Rule 12b-1 under the 1940 Act (the “12b-1 Plan”), on behalf of the Funds, which authorizes it to pay Quasar Distributors, LLC (the “Distributor”) a distribution fee of 0.25% of the Funds’
35
PLUMB FUNDS
Notes to Financial Statements
March 31, 2011 (Continued)
average daily net assets for services to prospective Fund shareholders and distribution of Fund shares. During the year ended March 31, 2011, the Plumb Balanced Fund and the Plumb Equity Fund incurred expenses of $106,373 and $39,056, respectively, pursuant to the 12b-1 Plan. As of March 31, 2011, $8,429 and $1,666 for the Plumb Balanced Fund and Plumb Equity Fund, respectively, were accrued.
4.INVESTMENT ADVISOR AND OTHER AFFILIATES
The Funds have an Investment Advisory Agreement (the “Advisory Agreement”) with Wisconsin Capital Management, LLC, with whom certain officers and directors of the Funds are affiliated. The Advisory Agreement provides for advisory fees computed daily and paid monthly at an annual rate of 0.65% of the Funds’ average daily net assets.
Under the terms of the Advisory Agreement, the Advisor has contractually agreed to limit the Funds’ expenses. Prior to July 1, 2010, annual operating expenses were limited to 1.10% and 1.20% of the Funds’ average daily net assets for the Plumb Balanced Fund and the Plumb Equity Fund, respectively. Effective July 1, 2010 until July 31, 2011, the Advisor has agreed to limit annual operating expenses to 1.25% and 1.40% of the Funds’ average daily net assets for the Plumb Balanced Fund and the Plumb Equity Fund, respectively. Any such waiver or reimbursement is subject to later adjustment to allow the Advisor to recoup amounts waived or reimbursed to the extent actual fees and expenses for a period are less than the expense limitation caps in place at the time the waiver was made, provided, however, that the Advisor shall only be entitled to recoup such amounts for a period of three years from the date such amount was waived or reimbursed. For the year ended March 31, 2011, the Advisor waived expenses for the Plumb Balanced Fund and the Plumb Equity Fund of $147,474 and $77,943, respectively.
The following table shows the remaining waived or reimbursed expenses subject to potential recovery as of March 31, 2011 expiring in:
| Plumb Balanced Fund | Plumb Equity Fund |
| 2012 . . . . . . . $213,244 | 2012 . . . . . . . $137,938 |
| 2013 . . . . . . . $223,649 | 2013 . . . . . . . $132,191 |
| 2014 . . . . . . . $147,474 | 2014 . . . . . . . $ 77,943 |
The Funds also have an Administrative and Accounting Services Agreement (“Agreement”) with the Advisor. The original Agreement was amended and restated effective September 1, 2010, when the Advisor took over fund administration responsibilities from another party. These fund administration responsibilities include general fund management, compliance, financial reporting, and oversight and assistance to other providers. Effective September
36
PLUMB FUNDS
Notes to Financial Statements
March 31, 2011 (Continued)
1, 2010, the Advisor’s administrative and accounting fees were increased from an annual rate of 0.15% to 0.20% of the Funds’ average daily net assets, computed daily and paid monthly.
5.INVESTMENT TRANSACTIONS
For the year ended March 31, 2011, purchases and sales of investment securities (including options), other than short-term investment securities and short-term U.S. Government Obligations, were as follows:
| Plumb Balanced Fund | Plumb Equity Fund | |
| Purchases: | $35,342,067 | $16,984,885 |
| Sales: | $39,150,856 | $17,260,348 |
6.BENEFICIAL OWNERSHIP
The beneficial ownership, either directly or indirectly, of more than 25% of the voting securities of a fund creates a presumption of control of the fund under Section 2(a)(9) of the Investment Company Act of 1940. As of March 31, 2011, the SVA Plumb Trust Company, for the benefit of its customers, owned 53.51% and 52.13% of the Plumb Balanced Fund and the Plumb Equity Fund, respectively. As a result, the SVA Plumb Trust Company may be deemed to control both the Plumb Balanced Fund and the Plumb Equity Fund. SVA Plumb Trust Company is wholly owned by SVA Plumb Financial, LLC.
7.FEDERAL TAX INFORMATION
As of March 31, 2011 the components of accumulated earnings (losses) for income tax purposes were as follows:
| Plumb Balanced Fund | Plumb Equity Fund | |||||||
| Unrealized appreciation | $ | 5,897,321 | $ | 3,090,610 | ||||
| Unrealized depreciation | (628,151 | ) | (346,660 | ) | ||||
| Net tax unrealized | ||||||||
| appreciation on investments | 5,269,170 | 2,743,950 | ||||||
| Undistributed ordinary income | 166,283 | — | ||||||
| Other accumulated losses | (13,805,503 | ) | (5,666,356 | ) | ||||
| Total accumulated losses | $ | (8,370,050 | ) | $ | (2,922,406 | ) | ||
The tax cost of investments as of March 31, 2011 was $39,165,314 and $14,452,733 for the Plumb Balanced Fund and Plumb Equity Fund, respectively. The tax basis of investments for tax and financial reporting purposes differs principally due to the deferral of losses on wash sales and the timing of income generated from certain underlying investments.
37
PLUMB FUNDS
Notes to Financial Statements
March 31, 2011 (Continued)
As of March 31, 2011 the Funds had tax basis capital losses which may be carried over to offset future capital gains as shown below.
| Capital Loss Carryover | ||||||||
| Plumb Balanced Fund | Plumb Equity Fund | |||||||
| Expires: | ||||||||
| March 31, 2017 | $ | (5,587,505 | ) | $ | (2,491,019 | ) | ||
| March 31, 2018 | $ | (8,217,998 | ) | $ | (3,175,337 | ) | ||
8.DISTRIBUTIONS TO SHAREHOLDERS
The tax character of distributions paid during the fiscal years ended March 31, 2011 and 2010 were as follows:
| Plumb Balanced Fund | ||||||||
| Year Ended | Year Ended | |||||||
| March 31, 2011 | March 31, 2010 | |||||||
| Distributions paid from: | ||||||||
| Ordinary Income | $ | 895,239 | $ | 934,405 | ||||
| Total Distributions Paid | $ | 895,239 | $ | 934,405 | ||||
| Plumb Equity Fund | ||||||||
| Year Ended | Year Ended | |||||||
| March 31, 2011 | March 31, 2010 | |||||||
| Distributions paid from: | ||||||||
| Ordinary Income | $ | 120,439 | $ | 140,237 | ||||
| Total Distributions Paid | $ | 120,439 | $ | 140,237 | ||||
38
PLUMB FUNDS
Report of Independent Registered Public Accounting Firm
To The Shareholders and Board of Directors
Wisconsin Capital Funds, Inc.
We have audited the accompanying statements of assets and liabilities, including the schedules of investments, of Wisconsin Capital Funds, Inc., comprising the Plumb Balanced Fund and Plumb Equity Fund (the “Funds”), as of March 31, 2011, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the four periods in the 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 March 31, 2011 by correspondence with the Funds’ custodian and brokers. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Plumb Balanced Fund and the Plumb Equity Fund as of March 31, 2011, the results of their operations for the year then ended, the changes in their net assets for each of the two years in the period then ended, and the financial highlights for each of the four periods in the period then ended, in conformity with accounting principles generally accepted in the United States of America.
COHEN FUND AUDIT SERVICES, LTD.
Westlake, Ohio
May 20, 2011
39
PLUMB FUNDS
Additional Information (Unaudited)
1.ADDITIONAL DISCLOSURE REGARDING FUND DIRECTORS AND OFFICERS
| Position(s) Held with | Principal | Number of | Other | ||
| Wisconsin Capital | Occupation(s) | Plumb Funds | Directorships | ||
| Name, Address | Funds, Inc. and Length | During Past | Overseen | Held by | |
| and Age | of Time Served(1) | Five Years | by Director | Director | |
| Independent Directors: | |||||
| Patrick J. Quinn | Director since | • | Currently retired | 2 | National |
| 1200 John Q. | May 2007 | • | President and | Presto | |
| Hammons Dr., | Chairman of the | Industries | |||
| 2nd Floor | Board of Ayres | since May | |||
| Madison, WI 53719 | Associates (professional | 2001 | |||
| Birth date: | civil engineering firm), | ||||
| September 1949 | from April 2000 to | ||||
| December 2010 | |||||
| Jay Loewi | Director since | • | Chief Executive | 2 | None |
| 1200 John Q. | May 2007 | Officer,QTI Group, | |||
| Hammons Dr., | since November 2007 | ||||
| 2nd Floor | • | President, QTI Group | |||
| Madison, WI 53719 | of Companies, | ||||
| Birth date: | since 2002 | ||||
| March 1957 | |||||
| Jeffrey B. Sauer | Director since | • | Assistant to the | 2 | None |
| 1200 John Q. | May 2007 | Commissioner of | |||
| Hammons Dr., | Western Collegiate | ||||
| 2nd Floor | Hockey Association, | ||||
| Madison, WI 53719 | since 2002 | ||||
| Birth date: | |||||
| March 1943 | |||||
| Interested Directors and Officers: | |||||
Thomas G. Plumb(2) | Director, Chairman, | • | President of SVA | 2 | None |
| 1200 John Q. | President and Chief | Plumb Wealth | |||
| Hammons Dr., | Executive Officer | Management, LLC, | |||
| 2nd Floor | since May 2007 | since March 2011 | |||
| Madison, WI 53719 | • | President of SVA | |||
| Birth date: | Plumb Financial, LLC, | ||||
| July 1952 | since March 2011 | ||||
| • | CEO of SVA Plumb | ||||
| Trust Company, | |||||
| since March 2011 | |||||
| • | President of Wisconsin | ||||
| Capital Management, | |||||
| LLC, since January 2004 | |||||
| • | CEO of Plumb Trust | ||||
| Company from 2001 | |||||
| to February 2011 | |||||
40
PLUMB FUNDS
Additional Information (Unaudited) (Continued)
| Position(s) Held with | Other | |||
| Wisconsin Capital | Directorships | |||
| Name, Address | Funds, Inc. and Length | Principal Occupation(s) | Held by | |
| and Age | of Time Served(1) | During Past Five Years | Director | |
| Timothy R. O’Brien | Chief Financial Officer | • | Principal of SVA Plumb | N/A |
| 1200 John Q. | since May 2007 | Wealth Management, | ||
| Hammons Dr., | LLC since March 2011 | |||
| 2nd Floor | Vice President | • | Vice President and | |
| Madison, WI 53719 | since August 2010 | Portfolio Manager for | ||
| Birth date: | Wisconsin Capital | |||
| June 1959 | Secretary | Management, LLC | ||
| from January | since 2004 | |||
| 2009 to July 2010 | ||||
| Treasurer | ||||
| from May 2007 | ||||
| to July 2010 | ||||
| Connie M. Redman | Chief Compliance | • | Vice President, Chief | N/A |
| 1200 John Q. | Officer since May 2007 | Compliance Officer, and | ||
| Hammons Dr., | Corporate Secretary of | |||
| 2nd Floor | Secretary | Wisconsin Capital | ||
| Madison, WI 53719 | since August 2010 | Management, LLC | ||
| Birth date: | since March 2008 | |||
| February 1966 | • | Vice President, Chief | ||
| Compliance Officer, Human | ||||
| Resources Manager and | ||||
| Corporate Secretary of | ||||
| Wisconsin Capital | ||||
| Management, LLC from | ||||
| October 2005 to March 2008 | ||||
41
PLUMB FUNDS
Additional Information (Unaudited) (Continued)
| Position(s) Held with | Other | |||
| Wisconsin Capital | Directorships | |||
| Name, Address | Funds, Inc. and Length | Principal Occupation(s) | Held by | |
| and Age | of Time Served(1) | During Past Five Years | Director | |
| Donna M. Baker | Treasurer | • | Operations Manager of | N/A |
| 1200 John Q. | since August 2010 | SVA Plumb Trust Company | ||
| Hammons Dr., | since March 2011 | |||
| 2nd Floor | Secretary | • | Chief Financial Officer and | |
| Madison, WI 53719 | from May 2007 to | Human Resource Manager | ||
| Birth date: | December 2008 | of Wisconsin Capital | ||
| March 1964 | Management, LLC, from | |||
| June 2010 to February 2011 | ||||
| • | Controller, HospiceCare, Inc. | |||
| from January 2009 to | ||||
| February 2010 | ||||
| • | Controller and Human | |||
| Resource Manager of | ||||
| Wisconsin Capital | ||||
| Management, LLC from | ||||
| March 2008 to | ||||
| December 2008 | ||||
| • | Controller of Wisconsin | |||
| Capital Management, LLC | ||||
| from August 2004 to | ||||
| March 2008 | ||||
| (1) | Officers of the Funds serve one-year terms, subject to annual reappointment by the Board of Directors. Directors of the Funds serve a term of indefinite length until their resignation or removal, and stand for re-election by shareholders as and when required under the 1940 Act. |
| (2) | Thomas G. Plumb is an “interested person” of the Funds by virtue of his positions with the Funds and the Advisor. |
42
PLUMB FUNDS
Additional Information (Unaudited) (Continued)
The Board of Directors of the Funds has an audit committee and a nominating committee. The audit committee consults with the independent auditors for the Funds on matters pertaining to their audits of the Funds’ annual financial statements, and approves all audit and non-audit services to be provided by the independent auditors. The audit committee has adopted a written charter, which is available upon request. The audit committee consists of Jay Loewi (Chair), Patrick J. Quinn and Jeffrey B. Sauer, none of whom is an “interested” person of the Funds. Jay Loewi has been determined by the Board to be an audit committee financial expert.
The nominating committee considers and recommends nominees for directors to the Board to fill vacancies and for election and re-election as and when required. All nominations of directors who are not “interested persons” of the Funds must be made and approved by the nominating committee. The nominating committee has not established any specific, minimum qualifications or standards for director nominees. The nominating committee will generally not consider any director candidates recommended by shareholders. The nominating committee has adopted a written charter, which is available upon request. No policy or procedure has been established as to the recommendation of director nominees by shareholders, except that nominations of directors who are not “interested persons” of the Funds must be made and approved by the nominating committee. The nominating committee consists of Jeffrey B. Sauer (Chair), Jay Loewi and Patrick J. Quinn.
The Funds’ Statement of Additional Information includes additional information about the directors of the Company and is available, without charge, at www.wiscap.com or upon request, by calling 1-866-987-7888.
2.QUALIFIED DIVIDEND INCOME/DIVIDENDS RECEIVED DEDUCTION
For the fiscal year ended March 31, 2011, certain dividends paid by the Funds may be subject to a maximum tax rate of 15%, as provided for by the Jobs and Growth Tax Relief Reconciliation Act of 2003. The percentage of dividends declared from ordinary income designated as qualified dividend income was as follows:
| Plumb Balanced Fund | 81.70% | |
| Plumb Equity Fund | 100.00% |
For corporate shareholders, the percent of ordinary income distributions qualifying for the corporate dividends–received deduction for the fiscal year ended March 31, 2011, was as follows:
| Plumb Balanced Fund | 67.70% | |
| Plumb Equity Fund | 100.00% |
43
WISCONSIN CAPITAL FUNDS, INC.
c/o U.S. Bancorp Fund Services, LLC
P.O. Box 701
Milwaukee, WI 53201-0701
1-866-987-7888
INVESTMENT ADVISOR
Wisconsin Capital Management, LLC
1200 John Q. Hammons Drive
Madison, WI 53717
Telephone: (608) 824-8800
DISTRIBUTOR
Quasar Distributors, LLC
615 East Michigan Street
Milwaukee, WI 53202
CUSTODIAN
U.S. Bank National Association
1555 N. Rivercenter Drive
MK-WI-5302
Milwaukee, WI 53212
TRANSFER AGENT AND
DIVIDEND DISBURSING AGENT
US Bancorp Fund Services, LLC
615 East Michigan Street
Milwaukee, WI 53202
INDEPENDENT ACCOUNTANTS
Cohen Fund Audit Services, Ltd.
800 Westpoint Parkway
Suite 1100
Westlake, OH 44145
LEGAL COUNSEL
Quarles & Brady LLP
411 East Wisconsin Avenue
Milwaukee, WI 53202
This report has been prepared for shareholders and may be distributed to others only if preceded or accompanied by a current prospectus.
The Funds’ Proxy Voting Policies and Procedures are available without charge upon request by calling 1-866-987-7888. Information regarding how the Funds voted proxies relating to portfolio securities during the 12-month period ended June 30, 2010 is available by calling 1-866-987-7888 and on the SEC’s website at www.sec.gov.
The Funds’ complete schedule of portfolio holdings for the first and third quarters is filed with the SEC on Form N-Q. The Funds’ Form N-Q is available without charge, upon request, by calling 1-866-987-7888 and on the SEC’s website at www.sec.gov. The Funds’ Forms N-Q may also 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.
Item 2. Code of Ethics.
The registrant has adopted a code of ethics that applies to the registrant’s principal executive officer and principal financial officer. The registrant has not made any material amendments to its code of ethics during the period covered by this report. The registrant has not granted any waivers from any provisions of the code of ethics during the period covered by this report.
A copy of the registrant’s Code of Ethics for the registrant’s principal executive officer and principal financial officer will be sent to you free of charge, upon request, by calling or writing to the registrant, 1200 John Q. Hammons Drive, Second Floor, Madison, Wisconsin 53717 or calling (608) 824-8800.
Item 3. Audit Committee Financial Expert.
The registrant’s board of directors has determined that there is at least one audit committee financial expert serving on its audit committee. Jay V. Loewi is the “audit committee financial expert” and is considered to be “independent” as each term is defined in Item 3 of Form N-CSR.
Item 4. Principal Accountant Fees and Services.
The registrant has engaged its principal accountant to perform audit services, audit-related services, tax services, and other services during the past two fiscal years. “Audit services” refer to performing an audit of the registrant's annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years. “Audit-related services” refer to the assurance and related services by the principal accountant that are reasonably related to the performance of the audit. “Tax services” refer to professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning. Other services rendered by the principal accountant consisted of a cursory reading of the disclosures and flow of figures to and from the body of the semi-annual financial statements. No services described in paragraphs (b) – (d) of this item were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X. The following table details the aggregate fees billed or expected to be billed for the last two fiscal years for audit fees, audit-related fees, tax fees and other fees by the principal accountant.
| FYE 3/31/11 | FYE 3/31/10 | |
| Audit Fees | $22,600 | $22,000 |
| Audit-Related Fees | 0 | 0 |
| Tax Fees | $ 4,000 | $ 4,000 |
| All Other Fees | $ 1,500 | 0 |
The audit committee has adopted pre-approval policies and procedures that require the audit committee to pre-approve all audit and non-audit services of the registrant, including services provided to any entity affiliated with the registrant. All of the principal accountant’s hours spent on auditing the registrant’s financial statements were attributed to work performed by full-time permanent employees of the principal accountant.
The following table indicates the non-audit fees billed or expected to be billed by the registrant’s accountant for services to the registrant and to the registrant’s investment adviser (and any other controlling entity, etc.—not sub-adviser) for the last year. The audit committee of the board of directors has considered whether the provision of non-audit services that were rendered to the registrant's investment adviser is compatible with maintaining the principal accountant's independence in its audit of the Registrant and has concluded that the provision of such non-audit services by the accountant has not compromised the accountant’s independence.
| Non-Audit Related Fees | FYE 3/31/11 | FYE 3/31/10 |
| Registrant | $1,500 | $0 |
| Registrant’s Investment Adviser | $ 0 | $0 |
Item 5. Audit Committee of Listed Registrants.
Not applicable to registrants who are not listed issuers (as defined in Rule 10A-3 under the Securities Exchange Act of 1934).
Item 6. Investments.
Schedule of Investments is included as part of the report to shareholders filed under Item 1 of this Form.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not applicable to open-end investment companies.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable to open-end investment companies.
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
Not applicable to open-end investment companies.
Item 10. Submission of Matters to a Vote of Security Holders.
There have been no material changes to the procedures by which shareholders may recommend nominees to the registrant’s board of directors/trustees.
Item 11. Controls and Procedures.
| (a) | The Registrant’s President/Chief Executive Officer (principal executive officer) and Vice President/Chief Financial Officer (principal financial officer) have reviewed the Registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the “Act”)) as of a date within 90 days of the filing of this report, as required by Rule 30a-3(b) under the Act and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934. Based on their review, such officers have concluded that the disclosure controls and procedures are effective in ensuring that information required to be disclosed in this report is appropriately recorded, processed, summarized and reported and made known to them by others within the Registrant. |
| (b) | There were no changes in the Registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting. |
Item 12. Exhibits.
| (a) | (1) Any code of ethics or amendment thereto, that is the subject of the disclosure required by Item 2, to the extent that the registrant intends to satisfy Item 2 requirements through filing an exhibit. Incorporated by reference to the Registrant’s June 6, 2009 N-CSR filing. |
(2) A separate certification for each principal executive and principal financial officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith.
| (b) | Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Furnished herewith. |
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) Wisconsin Capital Funds, Inc.
By (Signature and Title) /s/Thomas G. Plumb
Thomas G. Plumb, President
Date May 19, 2011
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/Thomas G. Plumb
Thomas G. Plumb, Principal Executive Officer
Date May 19, 2011
By (Signature and Title) /s/Timothy R. O’Brien
Timothy R. O’Brien, Principal Financial Officer
Date May 19, 2011