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 811-5349
Goldman Sachs Trust
(Exact name of registrant as specified in charter)
4900 Sears Tower, Chicago, Illinois 60606-6303
(Address of principal executive offices) (Zip code)
Howard B. Surloff, Esq. | Copies to: | |
Goldman, Sachs & Co. | Jeffrey A. Dalke, Esq. | |
One New York Plaza | Drinker Biddle & Reath LLP | |
New York, New York 10004 | One Logan Square | |
18th and Cherry Streets | ||
Philadelphia, PA 19103 | ||
(Name and address of agents for service) |
Registrant’s telephone number, including area code: (312) 655-4400
Date of fiscal year end: August 31
Date of reporting period: February 28, 2005
ITEM 1. | REPORTS TO STOCKHOLDERS. | |
The Semi-Annual Report to Stockholders is filed herewith. |
Goldman Sachs Funds RESEARCH SELECT FUND SM Semiannual Report February 28, 2005 Long-term growth of capital potential through a focused portfolio of U.S. equity investments |
Goldman Sachs Research Select FundSM |
NOT FDIC-INSURED May Lose Value No Bank Guarantee |
GOLDMAN SACHS RESEARCH SELECT FUND How Is the Goldman Sachs Research Select Fund Constructed? |
Through this Fund, investors can access the best research ideas of the Goldman Sachs Value and Growth investment teams. |
INVESTMENT OBJECTIVE CAPITALIZE ON THE BEST IDEAS IN VALUE AND GROWTH Long-term growth of |
THROUGH A DIVERSIFIED PORTFOLIO capital by investing in a focused portfolio of U.S. equity investments. |
How Do We Construct the Fund? |
Value Team Contributes Growth Team Contributes 25 “best ideas” 25 “best ideas” 3 3 Senior members of each team meet to construct the portfolio Identify the optimal mix of companies, as well as sector and industry weights Monitor and understand total portfolio risk Professional and efficient portfolio rebalancing |
RESEARCH SELECT FUND 45-55 stocks |
GOLDMAN SACHS RESEARCH SELECT FUND Portfolio Results |
Dear Shareholder, |
This report provides an overview on the performance of the Goldman Sachs Research Select Fund during the six-month reporting period that ended February 28, 2005. |
Performance Review Over the six-month period that ended February 28, 2005, the Fund’s Class A, B, C, Institutional, and Service Shares generated cumulative total returns, without sales charges, of 8.21%, 7.65%, 7.65%, 8.23%, and 8.08%, respectively. These returns compare to the 9.99% cumulative total return of the Fund’s benchmark, the S&P 500 Index (with dividends reinvested), over the same period. |
While the Fund generated positive absolute results during the period, it lagged its benchmark on a relative basis. This was largely the result of weakness in both the Finance and Media sectors. On the positive side, the Fund benefited from strength in the Health Care and Consumer Discretionary sectors. |
The Fund’s holdings in Freddie Mac and Fannie Mae detracted from results during the period. We believe their shares have been weak due to legislation under consideration in Congress which would strengthen the powers of their regulator, the Office of Federal Housing Enterprise Oversight (OFHEO). We feel the majority of the weakness can be traced to comments made by Federal Reserve Board Chairman Greenspan, in which he said that the purpose of Freddie Mac’s and Fannie Mae’s large mortgage portfolios did not make sense and that the companies should shrink their portfolios over the next five to seven years. With the exception of the Bush Administration, whose current position is not known, we believe that most influential policy makers are focused on strengthening OFHEO and not impairing the companies’ business models, as Mr. Greenspan has suggested. Even if Mr. Greenspan’s ideas about decreasing Freddie Mac’s and Fannie Mae’s portfolios were passed by Congress, we believe the firms are still trading slightly below their liquidation values. |
Detractors from performance in the Media sector included Lamar Advertising Co. and Univision Communications, Inc. Lamar Advertising reported continued strength in revenue growth during the fourth quarter 2004. However, the company had to take a large one-time depreciation expense due to billboards destroyed during last year’s hurricanes in the Southern U.S. We believe the one-time charge does not change the fundamentals of the business, which generates strong operating free cash flow. Univision’s stock fell after it indicated that fourth quarter 2004 revenues would come in below expectations due to a weak television network scatter business. The scatter market is where national advertisers make a national purchase for a short period of time to supplement their other advertising commitments on a specific network. Univision’s weakness is primarily due to several advertisers, particularly retailers, who were absent from 2004’s scatter market. The company has more exposure to the network scatter business than a traditional broadcast network because it does not sell out its entire television inventory. Univision is willing to run fewer minutes of commercials in order to maintain pricing power. Importantly, the businesses that represent 90% of Univision’s revenues remain strong. These include the upfront advertising commitments on the network, its television station group, and a radio station group. Towards the end of the reporting period, its stock rallied strongly. |
GOLDMAN SACHS RESEARCH SELECT FUND |
Within the Health Care sector, Caremark Rx, Inc. and Baxter International, Inc. were notable contributors to performance. Caremark is a leading pharmacy benefit management (PBM) company. PBMs plan and administer programs for reducing drug costs, primarily by designing drug formularies. Now that Caremark has completed its acquisition of Advanced PCS, it ranks as the largest PBM in terms of covered lives and the second largest in terms of prescriptions processed. The stock has performed well during the reporting period. |
Sector Allocation (Percentage of Portfolio) as of 2/28/05 20% 18.1% 15.5% 15% 10% 9.4% 8.9% 8.9% 6.8% 7.0% 6.1% 4.8% 5% 4.1% 4.2% 2.5% 2.6% 1.1% 0% |
Discretionary Staples Cyclicals Energy Finance Industrials Insurance Media Services Services Investments Technology Utilities Consumer Health Care Consumer Goods and Producer Short Term |
The percentage shown for each investment category reflects the value of investments in that category as a percentage of market value. |
Several Consumer Discretionary businesses, including Harrah’s Entertainment, Inc., Family Dollar Stores, Inc., and Lowe’s Companies, Inc. contributed to performance. Harrah’s stock benefited from a solid quarterly earnings report, released in February 2005, which was driven by broad strength across the company’s geographically diverse set of gaming properties. The company owns and operates casinos in virtually every major gaming market in the country. Harrah’s seeks to drive shareholder value through same-store growth, acquisition, and selective new-build projects, while focusing on return on invested capital. |
GOLDMAN SACHS RESEARCH SELECT FUND |
Portfolio Positioning |
The Goldman Sachs Research Select Fund is a U.S. large-cap portfolio that blends the “best ideas” from Goldman Sachs Asset Management’s Growth and Value Investment Teams. During the reporting period, these teams continued to utilize their disciplined investment process to seek compelling investment opportunities. Throughout the period, the Fund continued to be style neutral. |
Portfolio Highlights While the Fund underperformed its benchmark during the reporting period, there were a number of holdings that enhanced results, including the following: |
Tyco International Ltd. — Tyco is one of the dominant market players in each of its five lines of business. Tyco’s management is moving its focus away from acquisitions for the time being and focusing more on international expansion, market share opportunities, research and development/new products, demographics and service opportunities. Finally, Tyco’s management has been in place since the middle of 2002 and has focused on restoring the company’s credibility and fixing its accounting issues along with restructuring its debt payments. These problems have largely been addressed and management can now focus on improving the business. |
Wyeth — Wyeth’s pharmaceutical division boasts a strong lineup of drugs for treatment in areas of women’s health, arthritis, pain suppression, cardiology, depression, and viral infections. Although the diet drug (“phen-fen”) issue will continue to hamper Wyeth, we believe that, over time, investors will also focus on the company’s product portfolio and its sustainable, solid growth rate. Also, Wyeth has minimal exposure to generic competition over the next few years and is not dependent on the approval of new products to achieve its growth, which is in sharp contrast to most of its peers. |
PepsiCo, Inc. — Pepsi’s strength has been driven by its dominance in the fast-growing global snack food and non-carbonated beverage categories. Its Frito-Lay unit boasts nine of the top ten selling snack food brands in the U.S. Pepsi also benefits from owning the top sports drink (Gatorade), bottled water (Aquafina), and juice businesses (Tropicana). Pepsi’s recent success is due to a strategy that focuses on enhancing its core Frito-Lay business, focusing its soft drink efforts on markets where it has some advantages of scale, and making strategic acquisitions that leverage its distribution system. |
We thank you for your investment and look forward to your continued confidence. |
Goldman Sachs Growth and Value Investment Teams New York, March 18, 2005 |
Fund Basics as of February 28, 2005 |
Assets Under Management $222.1 Million Number of Holdings 51 NASDAQ SYMBOLS Class A Shares GSRAX Class B Shares GSRBX Class C Shares GSRCX Institutional Shares GSRIX Service Shares GSRSX |
GOLDMAN SACHS RESEARCH SELECT FUND PERFORMANCE REVIEW Fund Total Return September 1, 2004-February 28, 2005 (based on NAV)1 S&P 500 Index2 Class A 8.21% 9.99% Class B 7.65 9.99 Class C 7.65 9.99 Institutional 8.23 9.99 Service 8.08 9.99 |
1The net asset value (NAV) represents the net assets of the class of the Fund (ex-dividend) divided by the total number of shares of the class outstanding. The Fund’s performance reflects the reinvestment of dividends and other distributions. The Fund’s performance does not reflect the deduction of any applicable sales charges. 2The S&P 500 Index (with dividends reinvested) is the Standard & Poor’s 500 Composite Stock Price Index of 500 stocks, an unmanaged index of common stock prices. The Index figures do not reflect any deduction for fees, expenses or taxes. |
STANDARDIZED TOTAL RETURNS 3 For the period ended 12/31/04 Class A Class B Class C Institutional Service One Year 6.71% 7.09% 11.09% 13.35% 12.94% Since Inception -8.70 -8.64 -8.23 -7.18 -7.61 (6/19/00) |
3The Standardized Total Returns are average annual or cumulative total returns (only if the performance period is one year or less) as of the most recent calendar quarter-end. They assume reinvestment of all distributions at NAV. These returns reflect a maximum initial sales charge of 5.5% for Class A Shares, the assumed contingent deferred sales charge for Class B Shares (5% maximum declining to 0% after six years) and the assumed contingent deferred sales charge for Class C Shares (1% if redeemed within 12 months of purchase). Because Institutional and Service Shares do not involve a sales charge, such a charge is not applied to their Standardized Total Returns. |
Total return figures in the above charts represent past performance and do not guarantee future results, which will vary. The investment return and principal value of an investment will fluctuate and, therefore, an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the total return figures in the above charts. Please visit www.gs.com/funds to obtain the most recent month-end returns. |
Performance reflects expense limitations in effect. In their absence, performance would be reduced. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. |
TOP 10 HOLDINGS AS OF 2 /2 8/0 5 4 Holding % of Net Assets Line of Business |
Burlington Resources, Inc. 4.8% Energy Resources ChevronTexaco Corp. 4.1 Energy Resources Tyco International Ltd. 4.1 Electrical Equipment Citigroup, Inc. 3.5 Banks Microsoft Corp. 2.9 Computer Software PepsiCo, Inc. 2.8 Food & Beverage Activision, Inc. 2.8 Computer Software The McGraw-Hill Companies, Inc. 2.7 Publishing PPL Corp. 2.6 Electrical Utilities Bank of America Corp. 2.5 Banks |
4The top 10 holdings may not be representative of the Fund’s future investments. |
Statement of Investments
Shares | Description | Value | ||||||||
Common Stocks – 97.2% | ||||||||||
Aerospace & Defense – 3.0% | ||||||||||
37,255 | General Dynamics Corp. | $ | 3,924,814 | |||||||
27,100 | United Technologies Corp. | 2,706,748 | ||||||||
6,631,562 | ||||||||||
Auto Parts & Related – 1.1% | ||||||||||
35,475 | Eaton Corp. | 2,474,381 | ||||||||
Banks – 9.9% | ||||||||||
118,550 | Bank of America Corp. | 5,530,358 | ||||||||
161,250 | Citigroup, Inc. | 7,694,850 | ||||||||
132,028 | J.P. Morgan Chase & Co. | 4,825,623 | ||||||||
118,918 | KeyCorp | 3,924,294 | ||||||||
21,975,125 | ||||||||||
Computer Hardware – 4.8% | ||||||||||
54,290 | CDW Corp. | 3,120,046 | ||||||||
123,720 | Cisco Systems, Inc.* | 2,155,202 | ||||||||
132,350 | Dell, Inc.* | 5,305,912 | ||||||||
10,581,160 | ||||||||||
Computer Software – 6.4% | ||||||||||
281,385 | Activision, Inc.* | 6,151,076 | ||||||||
25,000 | Electronic Arts, Inc.* | 1,612,250 | ||||||||
257,230 | Microsoft Corp. | 6,477,052 | ||||||||
14,240,378 | ||||||||||
Diversified Media – 4.9% | ||||||||||
31,100 | The Walt Disney Co. | 868,934 | ||||||||
279,300 | Time Warner, Inc.* | 4,812,339 | ||||||||
152,100 | Viacom, Inc. Class B | 5,308,290 | ||||||||
10,989,563 | ||||||||||
Drugs & Medicine – 2.5% | ||||||||||
70,750 | Pfizer, Inc. | 1,860,017 | ||||||||
88,230 | Wyeth | 3,601,549 | ||||||||
5,461,566 | ||||||||||
Electrical Equipment – 4.1% | ||||||||||
269,150 | Tyco International Ltd. | 9,011,142 | ||||||||
Electrical Utilities – 2.6% | ||||||||||
105,300 | PPL Corp. | 5,743,062 | ||||||||
Energy Resources – 8.8% | ||||||||||
212,706 | Burlington Resources, Inc. | 10,556,599 | ||||||||
145,717 | ChevronTexaco Corp. | 9,046,111 | ||||||||
19,602,710 | ||||||||||
Financial Technology – 2.1% | ||||||||||
111,500 | First Data Corp. | 4,573,730 | ||||||||
Financials – 8.1% | ||||||||||
145,160 | Countrywide Financial Corp. | 5,044,310 | ||||||||
90,130 | Fannie Mae | 5,269,000 | ||||||||
16,760 | Freddie Mac | 1,039,120 | ||||||||
184,100 | MBNA Corp. | 4,670,617 | ||||||||
194,420 | The Charles Schwab Corp. | 2,041,410 | ||||||||
18,064,457 | ||||||||||
Food & Beverage – 5.9% | ||||||||||
47,250 | General Mills, Inc. | 2,474,483 | ||||||||
116,300 | PepsiCo, Inc. | 6,263,918 | ||||||||
65,500 | Wm. Wrigley Jr. Co. | 4,359,680 | ||||||||
13,098,081 | ||||||||||
Gaming/ Lodging – 1.9% | ||||||||||
64,500 | Harrah’s Entertainment, Inc. | 4,230,555 | ||||||||
Home Building & Related – 2.0% | ||||||||||
130,875 | Masco Corp. | 4,413,105 | ||||||||
Hotel & Leisure – 2.2% | ||||||||||
226,500 | Cendant Corp. | 5,010,180 | ||||||||
Household/ Personal Care – 0.9% | ||||||||||
45,812 | Avon Products, Inc. | 1,959,379 | ||||||||
Insurance – 4.2% | ||||||||||
77,025 | American International Group, Inc. | 5,145,270 | ||||||||
56,090 | XL Capital Ltd. | 4,206,750 | ||||||||
9,352,020 | ||||||||||
Media – 1.9% | ||||||||||
159,700 | Univision Communications, Inc.* | 4,214,483 | ||||||||
Medical Products – 2.1% | ||||||||||
128,720 | Baxter International, Inc. | 4,590,155 | ||||||||
Medical Providers – 2.3% | ||||||||||
114,290 | Caremark Rx, Inc.* | 4,375,021 | ||||||||
15,960 | Medco Health Solutions, Inc.* | 708,943 | ||||||||
5,083,964 | ||||||||||
Networking Telecom Equipment – 0.7% | ||||||||||
551,450 | Nortel Networks Corp.* | 1,477,886 | ||||||||
Publishing – 3.3% | ||||||||||
28,938 | Lamar Advertising Co.* | 1,136,974 | ||||||||
66,400 | The McGraw-Hill Companies, Inc. | 6,098,840 | ||||||||
7,235,814 | ||||||||||
Retailing – 5.2% | ||||||||||
103,400 | Family Dollar Stores, Inc. | 3,403,928 | ||||||||
68,680 | Lowe’s Companies, Inc. | 4,037,011 | ||||||||
80,400 | Wal-Mart Stores, Inc. | 4,149,444 | ||||||||
11,590,383 | ||||||||||
Semiconductors/ Semiconductor Capital Equipment – 2.1% | ||||||||||
117,580 | Linear Technology Corp. | 4,592,675 | ||||||||
Telecom Equipment – 2.2% | ||||||||||
138,170 | QUALCOMM, Inc. | 4,989,319 | ||||||||
Tobacco – 2.0% | ||||||||||
69,165 | Altria Group, Inc. | 4,540,682 | ||||||||
TOTAL COMMON STOCKS | ||||||||||
(Cost $177,923,507) | $ | 215,727,517 | ||||||||
6
Principal | Interest | Maturity | ||||||||||||||
Amount | Rate | Date | Value | |||||||||||||
Repurchase Agreement(a) – 2.5% | ||||||||||||||||
Joint Repurchase Agreement Account II | ||||||||||||||||
$5,600,000 | 2.64 | % | 03/01/2005 | $ | 5,600,000 | |||||||||||
Maturity Value: $5,600,411 | ||||||||||||||||
(Cost $5,600,000) | ||||||||||||||||
TOTAL INVESTMENTS — 99.7% | ||||||||||||||||
(Cost $183,523,507) | $ | 221,327,517 | ||||||||||||||
The percentage shown for each investment category reflects the value of investments in that category as a percentage of net assets. |
* | Non-income producing security. | |
(a) | Joint repurchase agreement was entered into on February 28, 2005. |
ADDITIONAL INVESTMENT INFORMATION |
JOINT REPURCHASE AGREEMENT ACCOUNT II — At February 28, 2005, the Fund had an undivided interest in the following Joint Repurchase Agreement Account II which equaled $5,600,000 in principal amount.
Principal | Interest | Maturity | Maturity | |||||||||||||
Repurchase Agreements | Amount | Rate | Date | Value | ||||||||||||
Banc of America Securities LLC | $ | 1,900,000,000 | 2.64% | 03/01/2005 | $ | 1,900,139,333 | ||||||||||
Barclays Capital PLC | 2,500,000,000 | 2.65 | 03/01/2005 | 2,500,184,028 | ||||||||||||
Greenwich Capital Markets | 400,000,000 | 2.65 | 03/01/2005 | 400,029,444 | ||||||||||||
J.P. Morgan Securities, Inc. | 697,000,000 | 2.65 | 03/01/2005 | 697,051,307 | ||||||||||||
Morgan Stanley & Co. | 1,500,000,000 | 2.64 | 03/01/2005 | 1,500,110,000 | ||||||||||||
UBS Securities LLC | 800,000,000 | 2.64 | 03/01/2005 | 800,058,667 | ||||||||||||
Westdeutsche Landesbank AG | 500,000,000 | 2.64 | 03/01/2005 | 500,036,667 | ||||||||||||
TOTAL | $ | 8,297,000,000 | $ | 8,297,609,446 | ||||||||||||
At February 28, 2005, the Joint Repurchase Agreement Account II was fully collateralized by Federal Farm Credit Bank, 0.00% to 2.38%, due 03/01/2005 to 10/02/2006; Federal Home Loan Bank, 0.00% to 7.63%, due 02/15/2006 to 11/14/2014; Federal Home Loan Mortgage Association, 0.00% to 12.00%, due 04/04/2005 to 03/01/2035; Federal National Mortgage Association, 0.00% to 9.50%, due 03/22/2005 to 03/01/2035 and Government National Mortgage Association, 4.50% to 5.50%, due 09/15/2019 to 11/15/2033. |
7
Statement of Assets and Liabilities
Assets: | |||||||
Investment in securities, at value (identified cost $183,523,507) | $ | 221,327,517 | |||||
Cash | 2,358 | ||||||
Receivables: | |||||||
Investment securities sold | 1,419,581 | ||||||
Dividends and interest | 273,594 | ||||||
Reimbursement from investment adviser | 25,133 | ||||||
Fund shares sold | 24,977 | ||||||
Other assets | 3,680 | ||||||
Total assets | 223,076,840 | ||||||
Liabilities: | |||||||
Payables: | |||||||
Fund shares repurchased | 553,441 | ||||||
Amounts owed to affiliates | 336,733 | ||||||
Accrued expenses | 102,903 | ||||||
Total liabilities | 993,077 | ||||||
Net Assets: | |||||||
Paid-in capital | 617,760,068 | ||||||
Accumulated undistributed net investment income | 319,192 | ||||||
Accumulated net realized loss on investment transactions | (433,799,507 | ) | |||||
Net unrealized gain on investment transactions | 37,804,010 | ||||||
NET ASSETS | $ | 222,083,763 | |||||
Net assets: | |||||||
Class A | $73,326,513 | ||||||
Class B | 106,682,073 | ||||||
Class C | 39,794,699 | ||||||
Institutional | 2,265,054 | ||||||
Service | 15,424 | ||||||
Shares outstanding: | |||||||
Class A | 10,708,716 | ||||||
Class B | 16,139,140 | ||||||
Class C | 6,016,801 | ||||||
Institutional | 324,761 | ||||||
Service | 2,262 | ||||||
Total shares outstanding, $0.001 par value (unlimited number of shares authorized) | 33,191,680 | ||||||
Net asset value, offering and redemption price per share:(a) | |||||||
Class A | $6.85 | ||||||
Class B | 6.61 | ||||||
Class C | 6.61 | ||||||
Institutional | 6.97 | ||||||
Service | 6.82 | ||||||
(a) | Maximum public offering price per share (NAV per share multiplied by 1.0582) for Class A Shares is $7.25. At redemption, Class B and C Shares may be subject to a contingent deferred sales charge, assessed on the amount equal to the lesser of the current net asset value or the original purchase price of the shares. |
8
Statement of Operations
Investment income: | ||||||
Dividends | $ | 2,643,315 | ||||
Interest | 10,810 | |||||
Total income | 2,654,125 | |||||
Expenses: | ||||||
Management fees | 1,179,302 | |||||
Distribution and Service fees(a) | 870,789 | |||||
Transfer Agent fees(b) | 222,280 | |||||
Custody and accounting fees | 46,621 | |||||
Printing fees | 34,348 | |||||
Registration fees | 32,833 | |||||
Professional fees | 23,330 | |||||
Trustee fees | 7,674 | |||||
Service Share fees | 37 | |||||
Other | 28,077 | |||||
Total expenses | 2,445,291 | |||||
Less — expense reductions | (110,358 | ) | ||||
Net expenses | 2,334,933 | |||||
NET INVESTMENT INCOME | 319,192 | |||||
Realized and unrealized gain (loss) on investment transactions: | ||||||
Net realized gain from investment transactions | 19,001,539 | |||||
Net change in unrealized gain (loss) on investments | (1,018,358 | ) | ||||
Net realized and unrealized gain on investment transactions | 17,983,181 | |||||
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 18,302,373 | ||||
(a) | Class A, Class B and Class C Shares had Distribution and Service fees of $98,864, $559,107, and $212,818, respectively. |
(b) | Class A, Class B, Class C, Institutional Class and Service Class Shares had Transfer Agent fees of $75,137, $106,230, $40,435, $474 and $4, respectively. |
9
Statements of Changes in Net Assets
For the | ||||||||||
Six Months Ended | For the | |||||||||
February 28, 2005 | Year Ended | |||||||||
(Unaudited) | August 31, 2004 | |||||||||
From operations: | ||||||||||
Net investment income (loss) | $ | 319,192 | $ | (1,663,744 | ) | |||||
Net realized gain from investment transactions | 19,001,539 | 49,530,013 | ||||||||
Net change in unrealized gain (loss) on investments | (1,018,358 | ) | (15,349,960 | ) | ||||||
Net increase in net assets resulting from operations | 18,302,373 | 32,516,309 | ||||||||
From share transactions: | ||||||||||
Proceeds from sales of shares | 2,817,562 | 4,795,104 | ||||||||
Cost of shares repurchased | (45,155,611 | ) | (94,156,889 | ) | ||||||
Net decrease in net assets resulting from share transactions | (42,338,049 | ) | (89,361,785 | ) | ||||||
TOTAL DECREASE | (24,035,676 | ) | (56,845,476 | ) | ||||||
Net assets: | ||||||||||
Beginning of period | 246,119,439 | 302,964,915 | ||||||||
End of period | $ | 222,083,763 | $ | 246,119,439 | ||||||
Accumulated undistributed net investment income | $ | 319,192 | $ | — | ||||||
10
Notes to Financial Statements
1. ORGANIZATION |
2. SIGNIFICANT ACCOUNTING POLICIES |
A. Investment Valuation — Investments in securities and investment companies traded on a U.S. securities exchange or the NASDAQ system are valued daily at their last sale price or official closing price on the principal exchange or system on which they are traded. If no sale occurs, securities are valued at the last bid price. Debt securities are valued at prices supplied by independent pricing services, broker/dealer-supplied valuations or matrix pricing systems. Unlisted equity and debt securities for which market quotations are available are valued at the last sale price on valuation date, or if no sale occurs, at the last bid price. Short-term debt obligations maturing in sixty days or less are valued at amortized cost, which approximates market value. Securities for which quotations are not readily available or are deemed to be inaccurate by the investment adviser are valued at fair value using methods approved by the Trust’s Board of Trustees.
B. Security Transactions and Investment Income — Security transactions are recorded as of the trade date. Realized gains and losses on sales of portfolio securities are calculated using the identified-cost basis. Dividend income is recorded on the ex-dividend date, net of foreign withholding taxes, if any, which are reduced by any amounts reclaimable by the Fund, where applicable. Interest income is recorded on the basis of interest accrued, premium amortized and discount accreted.
C. Federal Taxes — It is the Fund’s policy to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute each year substantially all of its investment company taxable income and capital gains to its shareholders. Accordingly, no federal tax provision is required. Dividends and distributions to shareholders are recorded on the ex-dividend date. Income and capital gains distributions, if any, are declared and paid annually.
D. Expenses — Expenses incurred by the Trust that do not specifically relate to an individual fund of the Trust are allocated to the Fund on a straight-line or pro-rata basis depending upon the nature of the expense.
2. SIGNIFICANT ACCOUNTING POLICIES (continued) |
E. Repurchase Agreements — Repurchase agreements involve the purchase of securities subject to the seller’s agreement to repurchase them at a mutually agreed upon date and price. During the term of a repurchase agreement, the value of the underlying securities held as collateral on behalf of the Fund, including accrued interest, is required to equal or exceed the value of the repurchase agreement, including accrued interest. If the seller defaults or becomes insolvent, realization of the collateral by the Fund may be delayed or limited and there may be a decline in the value of the collateral during the period while the Fund seeks to assert its rights. The underlying securities for all repurchase agreements are held in safekeeping at the Fund’s custodian or designated subcustodians under triparty repurchase agreements.
Pursuant to exemptive relief granted by the Securities and Exchange Commission (the “SEC”) and terms and conditions contained therein, the Fund, together with other registered investment companies having management agreements with Goldman Sachs Asset Management, L.P. (“GSAM”), or its affiliates, transfer uninvested cash into joint accounts, the daily aggregate balance of which is invested in one or more repurchase agreements.
F. Segregation Transactions — As set forth in the prospectus, the Fund may enter into certain derivative transactions to seek to increase total return. Forward foreign currency exchange contracts, futures contracts, written options, when-issued securities and forward commitments represent examples of such transactions. As a result of entering into these transactions, the Fund is required to segregate liquid assets on the accounting records equal to or greater than the market value of the corresponding transactions.
3. AGREEMENTS |
3. AGREEMENTS (continued) |
4. PORTFOLIO SECURITIES TRANSACTIONS |
5. SECURITIES LENDING |
6. LINE OF CREDIT FACILITY |
7. ADDITIONAL TAX INFORMATION |
Capital loss carryforward: | |||||
Expiring 2010 | $ | (219,754,790 | ) | ||
Expiring 2011 | (230,211,382 | ) | |||
Total capital loss carryforward | $ | (449,966,172 | ) | ||
At February 28, 2005, the Fund’s aggregate security unrealized gains and losses based on a cost for U.S. federal income tax purposes was as follows:
Tax Cost | $ | 186,321,330 | ||
Gross unrealized gain | 38,550,923 | |||
Gross unrealized loss | (3,544,736 | ) | ||
Net unrealized security gain | $ | 35,006,187 | ||
The difference between book-basis and tax-basis unrealized gains is attributable primarily to wash sales.
8. OTHER MATTERS |
In addition, on March 10, 2005 Jeanne and Don Masden filed a purported class action lawsuit in the United States District Court for the Southern District of New York against Goldman Sachs Group, Inc., GSAM, Goldman, Sachs & Co., the Trustees of the Trust and John Doe Defendants (collectively the “Defendants”). The lawsuit amends a previously-filed complaint, and alleges that the Defendants breached their fiduciary duties and duties of care owed under federal and state law by failing to ensure that equity securities held by the Goldman Sachs Funds participated in class action settlements for which they were eligible. Plaintiffs seek compensatory damages, disgorgement of the fees paid to the investment advisers and punitive damages. Based on currently available information, GSAM believes that the likelihood that the pending purported class action lawsuit will have a material adverse financial impact on the Goldman Sachs Funds is remote, and the pending action is not likely to materially affect its ability to provide investment management services to its clients, including the Goldman Sachs Funds.
9. SUMMARY OF SHARE TRANSACTIONS |
For the Six Months | ||||||||
Ended February 28, 2005 | ||||||||
Shares | Dollars | |||||||
Class A Shares | ||||||||
Shares sold | 271,293 | $ | 1,840,099 | |||||
Shares converted from Class B(a) | 5,628 | 37,864 | ||||||
Shares repurchased | (2,813,745 | ) | (18,843,619 | ) | ||||
(2,536,824 | ) | (16,965,656 | ) | |||||
Class B Shares | ||||||||
Shares sold | 84,323 | 544,144 | ||||||
Shares Converted to Class A(a) | (5,814 | ) | (37,864 | ) | ||||
Shares repurchased | (2,676,630 | ) | (17,320,447 | ) | ||||
(2,598,121 | ) | (16,814,167 | ) | |||||
Class C Shares | ||||||||
Shares sold | 36,312 | 235,378 | ||||||
Shares repurchased | (1,272,000 | ) | (8,223,989 | ) | ||||
(1,235,688 | ) | (7,988,611 | ) | |||||
Institutional Shares | ||||||||
Shares sold | 28,589 | 197,866 | ||||||
Shares repurchased | (113,538 | ) | (767,481 | ) | ||||
(84,949 | ) | (569,615 | ) | |||||
Service Shares | ||||||||
Shares sold | 11 | 75 | ||||||
Shares repurchased | (11 | ) | (75 | ) | ||||
— | — | |||||||
NET DECREASE | (6,455,582 | ) | $ | (42,338,049 | ) | |||
(a) | Class B Shares will automatically convert into Class A Shares at the end of the calendar quarter that is eight years after the initial purchase date of either the Fund or another Goldman Sachs Fund. |
9. SUMMARY OF SHARE TRANSACTIONS (continued) |
For the Year Ended | ||||||||
August 31, 2004 | ||||||||
Shares | Dollars | |||||||
Class A Shares | ||||||||
Shares sold | 407,111 | $ | 2,479,659 | |||||
Shares converted from Class B(a) | 6,412 | 41,612 | ||||||
Shares repurchased | (5,516,446 | ) | (34,051,917 | ) | ||||
(5,102,923 | ) | (31,530,646 | ) | |||||
Class B Shares | ||||||||
Shares sold | 236,355 | 1,423,760 | ||||||
Shares Converted to Class A(a) | (6,605 | ) | (41,612 | ) | ||||
Shares repurchased | (6,147,488 | ) | (36,800,552 | ) | ||||
(5,917,738 | ) | (35,418,404 | ) | |||||
Class C Shares | ||||||||
Shares sold | 131,510 | 787,620 | ||||||
Shares repurchased | (3,794,401 | ) | (22,690,531 | ) | ||||
(3,662,891 | ) | (21,902,911 | ) | |||||
Institutional Shares | ||||||||
Shares sold | 17,061 | 104,065 | ||||||
Shares repurchased | (98,037 | ) | (613,889 | ) | ||||
(80,976 | ) | (509,824 | ) | |||||
NET DECREASE | (14,764,528 | ) | $ | (89,361,785 | ) | |||
(a) | Class B Shares will automatically convert into Class A Shares at the end of the calendar quarter that is eight years after the initial purchase date of either the Fund or another Goldman Sachs Fund. |
Financial Highlights
Income (loss) from | ||||||||||||||||||||||||||||
investment operations | ||||||||||||||||||||||||||||
Net asset | ||||||||||||||||||||||||||||
value, | Net | Net realized | Total from | Net asset | ||||||||||||||||||||||||
beginning | investment | and unrealized | investment | value, end | Total | |||||||||||||||||||||||
Year - Share Class | of period | income (loss)(c) | gain (loss) | operations | of period | return(a) | ||||||||||||||||||||||
FOR THE SIX MONTHS ENDED FEBRUARY 28, (Unaudited) | ||||||||||||||||||||||||||||
2005 - Class A Shares | $ | 6.33 | $ | 0.03 | $ | 0.49 | $ | 0.52 | $ | 6.85 | 8.21 | % | ||||||||||||||||
2005 - Class B Shares | 6.14 | — | (d) | 0.47 | 0.47 | 6.61 | 7.65 | |||||||||||||||||||||
2005 - Class C Shares | 6.14 | — | (d) | 0.47 | 0.47 | 6.61 | 7.65 | |||||||||||||||||||||
2005 - Institutional Shares | 6.44 | 0.04 | 0.49 | 0.53 | 6.97 | 8.23 | ||||||||||||||||||||||
2005 - Service Shares | 6.31 | 0.02 | 0.49 | 0.51 | 6.82 | 8.08 | ||||||||||||||||||||||
FOR THE YEARS ENDED AUGUST 31, | ||||||||||||||||||||||||||||
2004 - Class A Shares | 5.65 | (0.01 | ) | 0.69 | 0.68 | 6.33 | 12.04 | |||||||||||||||||||||
2004 - Class B Shares | 5.52 | (0.05 | ) | 0.67 | 0.62 | 6.14 | 11.23 | |||||||||||||||||||||
2004 - Class C Shares | 5.52 | (0.05 | ) | 0.67 | 0.62 | 6.14 | 11.23 | |||||||||||||||||||||
2004 - Institutional Shares | 5.73 | 0.02 | 0.69 | 0.71 | 6.44 | 12.39 | ||||||||||||||||||||||
2004 - Service Shares | 5.64 | (0.01 | ) | 0.68 | 0.67 | 6.31 | 11.88 | |||||||||||||||||||||
2003 - Class A Shares | 4.99 | (0.02 | ) | 0.68 | 0.66 | 5.65 | 13.23 | |||||||||||||||||||||
2003 - Class B Shares | 4.90 | (0.05 | ) | 0.67 | 0.62 | 5.52 | 12.65 | |||||||||||||||||||||
2003 - Class C Shares | 4.91 | (0.05 | ) | 0.66 | 0.61 | 5.52 | 12.42 | |||||||||||||||||||||
2003 - Institutional Shares | 5.03 | — | (d) | 0.70 | 0.70 | 5.73 | 13.92 | |||||||||||||||||||||
2003 - Service Shares | 4.98 | (0.02 | ) | 0.68 | 0.66 | 5.64 | 13.25 | |||||||||||||||||||||
2002 - Class A Shares | 7.07 | (0.04 | ) | (2.04 | ) | (2.08 | ) | 4.99 | (29.42 | ) | ||||||||||||||||||
2002 - Class B Shares | 7.01 | (0.08 | ) | (2.03 | ) | (2.11 | ) | 4.90 | (30.10 | ) | ||||||||||||||||||
2002 - Class C Shares | 7.02 | (0.08 | ) | (2.03 | ) | (2.11 | ) | 4.91 | (30.06 | ) | ||||||||||||||||||
2002 - Institutional Shares | 7.11 | (0.01 | ) | (2.07 | ) | (2.08 | ) | 5.03 | (29.25 | ) | ||||||||||||||||||
2002 - Service Shares | 7.07 | (0.04 | ) | (2.05 | ) | (2.09 | ) | 4.98 | (29.56 | ) | ||||||||||||||||||
2001 - Class A Shares | 10.77 | (0.06 | ) | (3.64 | ) | (3.70 | ) | 7.07 | (34.35 | ) | ||||||||||||||||||
2001 - Class B Shares | 10.76 | (0.13 | ) | (3.62 | ) | (3.75 | ) | 7.01 | (34.85 | ) | ||||||||||||||||||
2001 - Class C Shares | 10.77 | (0.13 | ) | (3.62 | ) | (3.75 | ) | 7.02 | (34.82 | ) | ||||||||||||||||||
2001 - Institutional Shares | 10.78 | (0.03 | ) | (3.64 | ) | (3.67 | ) | 7.11 | (34.04 | ) | ||||||||||||||||||
2001 - Service Shares | 10.78 | (0.08 | ) | (3.63 | ) | (3.71 | ) | 7.07 | (34.35 | ) | ||||||||||||||||||
FOR THE PERIOD ENDED AUGUST 31, | ||||||||||||||||||||||||||||
2000 - Class A Shares (commenced June 19, 2000) | 10.00 | (0.02 | ) | 0.79 | 0.77 | 10.77 | 7.70 | |||||||||||||||||||||
2000 - Class B Shares (commenced June 19, 2000) | 10.00 | (0.04 | ) | 0.80 | 0.76 | 10.76 | 7.60 | |||||||||||||||||||||
2000 - Class C Shares (commenced June 19, 2000) | 10.00 | (0.04 | ) | 0.81 | 0.77 | 10.77 | 7.70 | |||||||||||||||||||||
2000 - Institutional Shares (commenced June 19, 2000) | 10.00 | (0.01 | ) | 0.79 | 0.78 | 10.78 | 7.80 | |||||||||||||||||||||
2000 - Service Shares (commenced June 19, 2000) | 10.00 | (0.02 | ) | 0.80 | 0.78 | 10.78 | 7.70 | |||||||||||||||||||||
(a) | Assumes investment at the net asset value at the beginning of the period, reinvestment of all dividends and distributions, a complete redemption of the investment at the net asset value at the end of the period and no sales or redemption charges. Total return would be reduced if a sales or redemption charge were taken into account. Total returns for periods less than one full year are not annualized. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. |
(b) | Annualized. |
(c) | Calculated based on the average shares outstanding methodology. |
(d) | Less than $0.005 per share. |
18
Ratios assuming no | ||||||||||||||||||||||||||
expense reductions | ||||||||||||||||||||||||||
Ratio of | Ratio of | |||||||||||||||||||||||||
Net assets | Ratio of | net investment | Ratio of total | net investment | ||||||||||||||||||||||
at end of | net expenses | income (loss) | expenses | income (loss) | Portfolio | |||||||||||||||||||||
period | to average | to average | to average | to average | turnover | |||||||||||||||||||||
(in 000s) | net assets | net assets | net assets | net assets | rate | |||||||||||||||||||||
$ | 73,327 | 1.49 | %(b) | 0.76 | %(b) | 1.58 | %(b) | 0.67 | %(b) | 21 | % | |||||||||||||||
106,682 | 2.24 | (b) | 0.01 | (b) | 2.33 | (b) | (0.08 | )(b) | 21 | |||||||||||||||||
39,795 | 2.24 | (b) | 0.00 | (b) | 2.33 | (b) | (0.09 | )(b) | 21 | |||||||||||||||||
2,265 | 1.09 | (b) | 1.18 | (b) | 1.18 | (b) | 1.09 | (b) | 21 | |||||||||||||||||
15 | 1.59 | (b) | 0.63 | (b) | 1.68 | (b) | 0.54 | (b) | 21 | |||||||||||||||||
83,908 | 1.50 | (0.11 | ) | 1.57 | (0.18 | ) | 41 | |||||||||||||||||||
115,016 | 2.25 | (0.86 | ) | 2.32 | (0.93 | ) | 41 | |||||||||||||||||||
44,543 | 2.25 | (0.86 | ) | 2.32 | (0.93 | ) | 41 | |||||||||||||||||||
2,638 | 1.10 | 0.29 | 1.17 | 0.22 | 41 | |||||||||||||||||||||
14 | 1.60 | (0.20 | ) | 1.67 | (0.27 | ) | 41 | |||||||||||||||||||
103,749 | 1.52 | (0.35 | ) | 1.58 | (0.41 | ) | 121 | |||||||||||||||||||
136,103 | 2.27 | (1.10 | ) | 2.33 | (1.16 | ) | 121 | |||||||||||||||||||
60,290 | 2.27 | (1.10 | ) | 2.33 | (1.16 | ) | 121 | |||||||||||||||||||
2,810 | 1.12 | 0.04 | 1.18 | (0.02 | ) | 121 | ||||||||||||||||||||
13 | 1.62 | (0.43 | ) | 1.68 | (0.49 | ) | 121 | |||||||||||||||||||
129,737 | 1.51 | (0.57 | ) | 1.54 | (0.60 | ) | 107 | |||||||||||||||||||
153,395 | 2.26 | (1.32 | ) | 2.29 | (1.35 | ) | 107 | |||||||||||||||||||
78,434 | 2.26 | (1.32 | ) | 2.29 | (1.35 | ) | 107 | |||||||||||||||||||
5,220 | 1.11 | (0.18 | ) | 1.14 | (0.21 | ) | 107 | |||||||||||||||||||
11 | 1.61 | (0.66 | ) | 1.64 | (0.69 | ) | 107 | |||||||||||||||||||
304,677 | 1.50 | (0.73 | ) | 1.53 | (0.76 | ) | 171 | |||||||||||||||||||
303,539 | 2.25 | (1.48 | ) | 2.28 | (1.51 | ) | 171 | |||||||||||||||||||
169,576 | 2.25 | (1.48 | ) | 2.28 | (1.51 | ) | 171 | |||||||||||||||||||
17,077 | 1.10 | (0.32 | ) | 1.13 | (0.35 | ) | 171 | |||||||||||||||||||
13 | 1.60 | (0.91 | ) | 1.63 | (0.94 | ) | 171 | |||||||||||||||||||
217,861 | 1.50 | (b) | (1.04 | )(b) | 2.05 | (b) | (1.59 | )(b) | 5 | |||||||||||||||||
201,437 | 2.25 | (b) | (1.79 | )(b) | 2.80 | (b) | (2.34 | )(b) | 5 | |||||||||||||||||
96,393 | 2.25 | (b) | (1.78 | )(b) | 2.80 | (b) | (2.33 | )(b) | 5 | |||||||||||||||||
12,677 | 1.10 | (b) | (0.50 | )(b) | 1.65 | (b) | (1.05 | )(b) | 5 | |||||||||||||||||
12 | 1.60 | (b) | (1.13 | )(b) | 2.15 | (b) | (1.68 | )(b) | 5 | |||||||||||||||||
Fund Expenses (Unaudited) — Six Month Period Ended February 28, 2005
As a shareholder of Class A, Class B, Class C, Institutional or Service Shares of the Funds you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments (with respect to Class A Shares) or contingent deferred sales charges (loads) on redemptions (with respect to Class B and Class C Shares); and (2) ongoing costs, including management fees; distribution and service (12b-1) fees (with respect to Class A, Class B and Class C Shares); and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in Class A, Class B, Class C, Institutional and Service Shares of the Fund 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 from September 1, 2004 through February 28, 2005.
Actual Expenses — The first line under each share class in the table below provides information about actual account values and actual expenses. 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” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes — The second line under each share class in the table below provides information about hypothetical account values and hypothetical expenses based on the Funds’ actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Funds’ 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). Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Expenses | ||||||||||||
Beginning | Ending | Paid for the | ||||||||||
Account Value | Account Value | 6 months ended | ||||||||||
Share Class | 9/1/04 | 2/28/05 | 2/28/05* | |||||||||
Class A | ||||||||||||
Actual | $ | 1,000 | $ | 1,082.10 | $ | 7.76 | ||||||
Hypothetical 5% return | 1,000 | 1,017.34 | + | 7.52 | ||||||||
Class B | ||||||||||||
Actual | 1,000 | 1,076.50 | 11.60 | |||||||||
Hypothetical 5% return | 1,000 | 1,013.62 | + | 11.25 | ||||||||
Class C | ||||||||||||
Actual | 1,000 | 1,076.50 | 11.60 | |||||||||
Hypothetical 5% return | 1,000 | 1,013.62 | + | 11.25 | ||||||||
Institutional | ||||||||||||
Actual | 1,000 | 1,082.30 | 5.69 | |||||||||
Hypothetical 5% return | 1,000 | 1,019.33 | + | 5.52 | ||||||||
Service | ||||||||||||
Actual | 1,000 | 1,080.80 | 8.28 | |||||||||
Hypothetical 5% return | 1,000 | 1,016.84 | + | 8.03 | ||||||||
* | Expenses for each share class are calculated using the fund’s annualized expense ratio for each class, which represents the ongoing expenses as a percentage of net assets for the six months ended 2/28/05. Expenses are calculated by multiplying the annualized expense ratio by the average account value for the period; then multiplying the result by the number of days in the most recent fiscal half year; and then dividing that result by the number of days in the calendar year. The expense ratios for the period were 1.50%, 2.25%, 2.25%, 1.10% and 1.60% for Class A, Class B, Class C, Institutional Class and Service Class, respectively. |
+ | Hypothetical expenses are based on the Fund’s actual annualized expense ratios and an assumed rate of return of 5% per year before expenses. |
FUNDS PROFILE Goldman Sachs Funds THE GOLDMAN SACHS ADVANTAGE |
Our goal is to deliver: Strong, Consistent Investment Results Global Resources and Global Research Team Approach Disciplined Processes Innovative, Value-Added Investment Products Thoughtful Solutions Risk Management Outstanding Client Service Dedicated Service Teams Excellence and Integrity |
Goldman Sachs is a premier financial services firm, known since 1869 for creating thoughtful and customized investment solutions in complex global markets. |
Today, Goldman Sachs Asset Management, L.P. and other units of the Investment Management Division of Goldman Sachs serve a diverse set of clients worldwide, including private institutions, public entities and individuals. With portfolio management teams located around the world — and $451.3 billion in assets under management as of December 31, 2004 — our investment professionals bring firsthand knowledge of local markets to every investment decision, making us one of the few truly global asset managers. |
GOLDMAN SACHS FUNDS In building a globally diversified portfolio, you can select from more than 50 Goldman Sachs Funds and gain access to investment opportunities across borders, investment styles, asset classes and security capitalizations. |
FIXED INCOME MONEY Risk/Return MARKET Lower International Equity Funds Asia Growth Fund Emerging Markets Equity Fund International Growth Opportunities Fund Japanese Equity Fund European Equity Fund International Equity Fund CORESM International Equity Fund |
INTERNATIONAL EQUITY Risk/Return Higher DOMESTIC EQUITY PORTFOLIOS ALLOCATION SPECIALTY ASSET Asset Allocation Funds |
Balanced Fund |
Domestic Equity Funds |
Asset Allocation Portfolios Small Cap Value Fund CORESM Small Cap Equity Fund Fixed Income Funds Mid Cap Value Fund Emerging Markets Debt Fund Concentrated Growth Fund High Yield Fund Growth Opportunities Fund High Yield Municipal Fund Research Select FundSM Global Income Fund Strategic Growth Fund Investment Grade Credit Fund Capital Growth Fund Core Fixed Income Fund Large Cap Value Fund U.S. Mortgages Fund Growth and Income Fund Municipal Income Fund CORESM Large Cap Growth Fund Government Income Fund CORESM Large Cap Value Fund Short Duration Tax-Free Fund CORESM U.S. Equity Fund Short Duration Government Fund Ultra-Short Duration Government |
Specialty Funds |
Fund Tollkeeper FundSM |
Enhanced Income Fund CORESM Tax-Managed Equity Fund Real Estate Securities Fund Money Market Funds1 |
1An investment in a money market fund is neither insured nor guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Funds seek to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Funds. |
The Goldman Sachs Research Select FundSM, Tollkeeper FundSM and CORESM are registered service marks of Goldman, Sachs & Co. |
GOLDMAN SACHS ASSET MANAGEMENT, L.P. 32 OLD SLIP, 32ND FLOOR, NEW YORK, NEW YORK 10005 |
TRUSTEES OFFICERS Ashok N. Bakhru, Chairman Kaysie P. Uniacke, President John P. Coblentz, Jr. James A. Fitzpatrick, Vice President Patrick T. Harker James A. McNamara, Vice President Mary Patterson McPherson John M. Perlowski, Treasurer Alan A. Shuch Howard B. Surloff, Secretary Wilma J. Smelcer Richard P. Strubel Kaysie P. Uniacke |
GOLDMAN, SACHS & CO. GOLDMAN SACHS ASSET MANAGEMENT, L.P. Distributor and Transfer Agent Investment Adviser |
Visit our Web site at www.gs.com/funds to obtain the most recent month-end returns |
The reports concerning the Fund included in this shareholder report may contain certain forward-looking statements about the factors that may affect the performance of the Fund in the future. These statements are based on Fund management’s predictions and expectations concerning certain future events and their expected impact on the Fund, such as performance of the economy as a whole and of specific industry sectors, changes in the levels of interest rates, the impact of developing world events, and other factors that may influence the future performance of the Fund. Management believes these forward-looking statements to be reasonable, although they are inherently uncertain and difficult to predict. Actual events may cause adjustments in portfolio management strategies from those currently expected to be employed. |
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities and information regarding how a Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available (I) without charge, upon request by calling 1-800-526-7384 (for Retail Shareholders) or 1-800-621-2550 (for Institutional Shareholders); and (II) on the Securities and Exchange Commission Web site at http://www.sec.gov. |
The Fund files its complete schedule 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. The Fund’s Form N-Q is available on the Commission’s website at http://www.sec.gov. The Fund’s Form N-Q may be reviewed and copied at the Commission’s Public Reference Room in Washington, D.C. and information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330. Form N-Q may be obtained upon request and without charge by calling 1-800-526-7384 (for Retail Shareholders) or 1-800-621-2550 (for Institutional Shareholders). |
The Fund is subject to the risk of rising and falling stock prices. In recent years, the U.S. stock market has experienced substantial price volatility. |
The Fund may participate in the Initial Public Offering (IPO) market, and a portion of the Fund’s returns consequently may be attributable to its investment in IPOs,which may have a magnified impact due to the Fund’s small asset base. As the Fund’s assets grow, it is probable that the effect of the Fund’s investment in IPOs on its total returns may not be as significant. |
Holdings and allocations shown are unaudited, and may not be representative of current or future investments. Holdings and allocations may not include the Fund’s entire investment portfolio, which may change at any time. Fund holdings should not be relied on in making investment decisions and should not be construed as research or investment advice regarding particular securities. |
Goldman Sachs Research Select FundSM is a registered service mark of Goldman, Sachs & Co. |
This material is not authorized for distribution to prospective investors unless preceded or accompanied by a current Prospectus. Please consider a Fund’s objectives, risks, and charges and expenses, and read the Prospectus carefully before investing. The Prospectus contains this and other information about the Fund. |
Copyright 2005 Goldman, Sachs & Co. All rights reserved. Date of first use: April 29, 2005 / 05-608 RESSAR / 25.8K / 04-05 |
ITEM 2. | CODE OF ETHICS. — Not applicable to the Semi-Annual Report for the period ended February 28, 2005 |
ITEM 3. | AUDIT COMMITTEE FINANCIAL EXPERT. — Not applicable to the Semi-Annual Report for the period ended February 28, 2005 |
ITEM 4. | PRINCIPAL ACCOUNTANT FEES AND SERVICES. — Not applicable to the Semi-Annual Report for the period ended February 28, 2005 |
ITEM 5. | AUDIT COMMITTEE OF LISTED REGISTRANTS. | |
Not applicable. |
ITEM 6. | SCHEDULE OF INVESTMENTS. | |
Schedule of Investments is included as part of the Report to Shareholders filed under Item 1. |
ITEM 7. | DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. | |
Not applicable. |
ITEM 8. | PORTFOLIO MANAGERS OF CLOSED END MANAGEMENT INVESTMENT COMPANIES. | |
Not applicable. |
ITEM 9. | PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS. | |
Not applicable. |
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 trustees. | |
ITEM 11. | CONTROLS AND PROCEDURES. | |
(a) | The Registrant’s Principal Executive Officer and Principal Financial Officer concluded that the Registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940), as enhanced as described below, were effective as of a date within 90 days prior to the filing date of this report (the “Evaluation Date”), based on their evaluation of the effectiveness of the Registrant's disclosure controls and procedures as of the Evaluation Date. | ||
(b) | During the filing period of this report, the Registrant enhanced its control environment to ensure the increased tracking and filing of class action claims with respect to securities owned by the Funds and the recognition of gain contingencies on the financial statements. See the footnotes to the financial statements of the CORE Large Cap Growth Fund and Growth and Income Fund regarding related receivables for these Funds. Fund management has discussed these matters with the Registrant’s Audit Committee and auditors. | ||
ITEM 12. | EXHIBITS. |
(a)(1) | Goldman Sachs Trust’s Code of Ethics for Principal Executive and Senior Financial Officers is incorporated by reference to Exhibit 11(a)(1) of the registrant’s Form N-CSR filed on March 8, 2004 for its Real Estate Securities Fund (Accession Number 0000950123-04-0002984). | ||
(a)(2) | Exhibit 99.CERT | Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 filed herewith. | ||
(b) | Exhibit 99.906CERT | Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 filed 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. |
Goldman Sachs Trust | ||||||
By: | /s/ Kaysie P. Uniacke | |||||
Kaysie P. Uniacke | ||||||
President/Principal Executive Officer | ||||||
Goldman Sachs Trust | ||||||
Date: | May 9, 2005 |
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: | /s/ Kaysie P. Uniacke | |||||
Kaysie P. Uniacke | ||||||
President/Principal Executive Officer | ||||||
Goldman Sachs Trust | ||||||
Date: | May 9, 2005 | |||||
By: | /s/ John M. Perlowski | |||||
John M. Perlowski | ||||||
Treasurer/Principal Financial Officer | ||||||
Goldman Sachs Trust | ||||||
Date: | May 9, 2005 |