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 811-4181
FIRST INVESTORS U.S. GOVERNMENT PLUS FUND
(Exact name of registrant as specified in charter)
- --------
95 Wall Street
New York, NY 10005
(Address of principal executive offices) (Zip code)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE:
1-212-858-8000
DATE OF FISCAL YEAR END: DECEMBER 31, 2003
DATE OF REPORTING PERIOD: DECEMBER 31, 2003
Item 1. Reports to Stockholders
The Annual Report to Stockholders follows
[Logo: "FIRST INVESTORS"]
First Investors
U.S. Government Plus Fund
Annual Report
December 31, 2003
[Logo: "FIRST INVESTORS FINANCIAL NETWORK"]
F16146
Portfolio Managers' Letter
FIRST INVESTORS U.S. GOVERNMENT PLUS FUND -- 1ST FUND
Dear Investor:
This is the annual report for the First Investors U.S. Government Plus Fund
for the year ended December 31, 2003. During the year, the Fund's return on
a net asset value basis was 1.4% and the Fund declared dividends of 66.3
cents per share and capital gains of 10.1 cents per share.
The Fund's holdings were almost exclusively Treasury STRIPS, which are zero
coupon bonds, that mature in 2004. During 2003, the Fund's return was
primarily the result of the fact that these securities, which are very
sensitive to changes in interest rates, increased in price as interest
rates declined. In addition, the investment performance of such securities
is tied to their relative maturities, with those having shorter maturities,
such as those held in the Fund, generating returns only slightly higher
than cash or investments in commercial paper.
Thank you for placing your trust in First Investors. As always, we
appreciate the opportunity to serve your investment needs.
Sincerely,
/s/ EDWIN D. MISKA
Edwin D. Miska
Director of Equities
/s/ CLARK D. WAGNER
Clark D. Wagner
Director of Fixed Income
January 31, 2004
Cumulative Performance Information
FIRST INVESTORS U.S. GOVERNMENT PLUS FUND -- 1st FUND
Comparison of change in value of $10,000 investment in the First Investors
U.S. Government Plus Fund -- 1st Fund, the Lehman Brothers Intermediate
Treasury Index and the Lehman Brothers Long Term Treasury Index.
U.S. GOVERNMENT PLUS FUND -- 1st FUND
GRAPH PLOTS
As of December 31, 2003
LEHMAN BROTHERS LEHMAN BROTHERS
GOVT PLUS INTERMEDIATE LONG TERM
1st FUND TREASURY INDEX TREASURY INDEX
Dec-93 $ 9,200 $10,000 $10,000
Dec-94 8,200 9,824 9,236
Dec-95 10,578 11,240 12,071
Dec-96 10,319 11,687 11,966
Dec-97 11,258 12,586 13,770
Dec-98 12,550 13,671 15,632
Dec-99 11,907 13,727 14,265
Dec-00 13,244 15,135 17,157
Dec-01 14,244 16,370 17,879
Dec-02 15,192 17,889 20,881
Dec-03 15,411 18,267 21,399
(INSET BOX IN CHART READS:)
Average Annual Total Return*
N.A.V. Only S.E.C. Standardized
One Year 1.44% (6.70%)
Five Years 4.19% 2.47%
Ten Years 5.29% 4.42%
The graph compares a $10,000 investment in the First Investors U.S.
Government Plus Fund -- 1st Fund beginning 12/31/93 with theoretical
investments in the Lehman Brothers Intermediate Treasury Index and the
Lehman Brothers Long Term Treasury Index (the "Indices"). The Lehman
Brothers Intermediate Treasury Index is made up of all public obligations
of the U.S. Treasury with maturities of less than 10 years. The Lehman
Brothers Long Term Treasury Index is made up of all public obligations of
the U.S. Treasury with maturities of 10 years or greater. It is not
possible to invest directly in these Indices. In addition, the Indices do
not take into account fees and expenses that an investor would incur in
purchasing securities in the Indices. For purposes of the graph and the
accompanying table, unless otherwise indicated, it has been assumed that
the maximum sales charge was deducted from the initial $10,000 investment
in the Fund and dividends and distributions were reinvested.
* Average Annual Total Return figures (for the periods ended 12/31/03)
include the reinvestment of all dividends and distributions. "N.A.V.
Only" returns are calculated without sales charges. The "S.E.C.
Standardized" returns shown are based on the maximum sales charge of
8.00%. During the periods shown, some expenses of the Fund were waived or
assumed. If such expenses had been paid by the Fund, the "S.E.C.
Standardized" Average Annual Total Return for One Year, Five Years and
Ten Years would have been (8.05%), 1.22% and 3.59%, respectively. Results
represent past performance and do not indicate future results. 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 original
cost. Lehman Brothers Intermediate Treasury Index and Lehman Brothers
Long Term Treasury Index figures are from Lehman Brothers, Inc. and all
other figures are from First Investors Management Company, Inc.
Portfolio of Investments
FIRST INVESTORS U.S. GOVERNMENT PLUS FUND -- 1st FUND
December 31, 2003
- ------------------------------------------------------------------------------------------------
Amount
Principal Invested
Amount For Each
or $10,000 of
Shares Security Value Net Assets
- ------------------------------------------------------------------------------------------------
U.S. GOVERNMENT SECURITIES--94.7%
$900M Treasury STRIPS, due 11/15/2004 (cost $826,274) $890,734 $9,467
- ------------------------------------------------------------------------------------------------
COMMON STOCKS--2.3%
Consumer Discretionary--.5%
150 * Movie Gallery, Inc. 2,802 30
100 Pier 1 Imports, Inc. 2,186 23
- ------------------------------------------------------------------------------------------------
4,988 53
- ------------------------------------------------------------------------------------------------
Consumer Staples--.3%
100 * Chiquita Brands International, Inc. 2,253 24
100 * Pathmark Stores, Inc. 760 8
- ------------------------------------------------------------------------------------------------
3,013 32
- ------------------------------------------------------------------------------------------------
Health Care--.8%
150 * Centene Corporation 4,202 44
200 * Province Healthcare Company 3,200 34
- ------------------------------------------------------------------------------------------------
7,402 78
- ------------------------------------------------------------------------------------------------
Industrials--.2%
100 * Mobile Mini, Inc. 1,972 21
- ------------------------------------------------------------------------------------------------
Information Technology--.5%
86 * Intergraph Corporation 2,057 22
100 * Manhattan Associates, Inc. 2,764 29
- ------------------------------------------------------------------------------------------------
4,821 51
- ------------------------------------------------------------------------------------------------
Total Value of Common Stocks (cost $16,075) 22,196 235
- ------------------------------------------------------------------------------------------------
Total Value of Investments (cost $842,349) 97.0% 912,930 9,702
Other Assets, Less Liabilities 3.0 28,041 298
- ------------------------------------------------------------------------------------------------
Net Assets 100.0% $940,971 $10,000
================================================================================================
* Non-income producing
See notes to financial statements
Statement of Assets and Liabilities
FIRST INVESTORS U.S. GOVERNMENT PLUS FUND -- 1st FUND
December 31, 2003
- ---------------------------------------------------------------------------------------------
Assets
Investments in securities:
At identified cost $ 842,349
===========
At value (Note 1A) $ 912,930
Cash 30,339
Other assets 2,676
-----------
Total Assets 945,945
-----------
Liabilities
Distributions payable 590
Accrued expenses 3,697
Accrued advisory fees 511
Accrued shareholder servicing costs 176
-----------
Total Liabilities 4,974
-----------
Net Assets $ 940,971
===========
Net Assets Consist of:
Capital paid in $ 870,390
Net unrealized appreciation in value of investments 70,581
-----------
Total $ 940,971
===========
Shares of beneficial interest outstanding (Note 3) 118,341
===========
Net Asset Value and Redemption Price Per Share
(Net assets divided by shares of beneficial interest outstanding) $7.95
=====
Maximum Offering Price Per Share
(Net asset value /.92) $8.64
=====
See notes to financial statements
Statement of Operations
FIRST INVESTORS U.S. GOVERNMENT PLUS FUND -- 1st FUND
Year Ended December 31, 2003
- ---------------------------------------------------------------------------------------------
Investment Income
Income:
Interest $ 82,330
Dividends 28
-----------
Total income 82,358
-----------
Expenses (Notes 1 and 4):
Advisory fee 9,786
Professional fees 7,883
Shareholder servicing costs 2,057
Custodian fees 538
Other expenses 3,724
-----------
Total expenses 23,988
Less: Expenses waived or assumed (13,027)
Custodian fees paid indirectly (195)
-----------
Net expenses 10,766
-----------
Net investment income 71,592
-----------
Realized and Unrealized Gain (Loss) on Investments (Note 2):
Net realized gain on investments 10,876
Net unrealized depreciation of investments (68,183)
-----------
Net loss on investments (57,307)
-----------
Net Increase in Net Assets Resulting from Operations $ 14,285
===========
See notes to financial statements
Statement of Changes in Net Assets
FIRST INVESTORS U.S. GOVERNMENT PLUS FUND -- 1st FUND
- ---------------------------------------------------------------------------------------------
Year Ended December 31 2003 2002
- ---------------------------------------------------------------------------------------------
Increase (Decrease) in Net Assets from Operations
Net investment income $ 71,592 $ 73,929
Net realized gain on investments 10,876 30,439
Net unrealized depreciation of investments (68,183) (37,187)
---------- ----------
Net increase in net assets resulting from operations 14,285 67,181
---------- ----------
Distributions to Shareholders
Net investment income (71,594) (73,929)
Net realized gains (10,933) (30,036)
---------- ----------
Total distributions (82,527) (103,965)
---------- ----------
Trust Share Transactions *
Reinvestment of distributions 81,937 103,210
Cost of shares redeemed (90,211) (147,275)
---------- ----------
Net decrease from trust share transactions (8,274) (44,065)
Net decrease in net assets (76,516) (80,849)
Net Assets
Beginning of year 1,017,487 1,098,336
---------- ----------
End of year $ 940,971 $1,017,487
========== ==========
* Trust Shares Issued and Redeemed
Issued for distributions reinvested 10,307 12,015
Redeemed (10,404) (16,045)
---------- ----------
Net decrease in trust shares outstanding (97) (4,030)
========== ==========
See notes to financial statements
Notes to Financial Statements
FIRST INVESTORS U.S. GOVERNMENT PLUS FUND -- 1ST FUND
December 31, 2003
1. Significant Accounting Policies -- First Investors U.S. Government Plus
Fund (the "Trust") is organized as a Massachusetts business trust and is
registered under the Investment Company Act of 1940 (the "1940 Act") as a
diversified open-end management investment company. The Trust operates as a
series fund, currently issuing shares of beneficial interest of the 1st
Fund (the "Fund") only. The Fund's objective is first to generate income,
and, to a lesser extent, achieve long-term capital appreciation.
A. Security Valuation -- Except as provided below, a security listed or
traded on an exchange or the Nasdaq Stock Market is valued at its last sale
price on the exchange or market where the security is principally traded.
Securities which have no sales on a particular day and securities traded in
the over-the-counter market are valued at the mean between the closing bid
and asked prices. The Treasury STRIPS in which the Fund invests are traded
primarily in the over-the-counter market. Such securities are valued at the
mean between the last bid and asked prices based upon quotes furnished by a
market maker for such securities. Securities may also be priced by a
pricing service approved by the Fund's Board of Trustees. The pricing
service considers security type, rating, market condition and yield data as
well as market quotations, prices provided by market makers and other
available information in determining value. If market quotations or prices
are not readily available or determined to be unreliable, the securities
will be valued at fair value as determined in good faith pursuant to
procedures adopted by the Fund's Board of Trustees.
B. Federal Income Taxes -- No provision has been made for federal income
taxes on net income or capital gains, since it is the policy of the Fund to
continue to comply with the special provisions of the Internal Revenue Code
applicable to investment companies and to make sufficient distributions of
income and capital gains (in excess of any available capital loss
carryovers) to relieve the Fund from all, or substantially all, federal
income taxes.
C. Distributions to Shareholders -- Distributions to shareholders are
generally declared and paid annually. Income dividends and capital gain
distributions are determined in accordance with income tax regulations,
which may differ from accounting principles generally accepted in the
United States of America. These differences are primarily due to differing
treatments for post-October capital losses.
D. Security Transactions and Investment Income -- Security transactions are
accounted for on the date the securities are purchased or sold. Cost is
determined, and gains and losses are based, on the identified cost basis
for common stocks and the amortized cost basis for Treasury STRIPS for both
financial statement and federal income tax purposes. Dividend income is
recorded on the ex-dividend date. Interest income (consisting of accreted
discount) and estimated expenses are accrued daily. For the year ended
December 31, 2003, the Fund's custodian has provided credits in the amount
of $195 against custodian charges based on the uninvested cash balances of
the Fund.
E. Use of Estimates -- The preparation of the financial statements in
conformity with accounting principles generally accepted in the United
States of America requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities at the date of
the financial statements and the reported amounts of revenue and expense
during the reporting period. Actual results could differ from those
estimates.
Notes to Financial Statements (continued)
FIRST INVESTORS U.S. GOVERNMENT PLUS FUND -- 1ST FUND
December 31, 2003
2. Security Transactions -- For the year ended December 31, 2003, purchases
and sales of securities and long-term U.S. Government Obligations,
excluding short-term notes, were as follows:
Long-Term
Securities U.S. Government Obligations
---------- ---------------------------
Purchases $ -- $ --
Proceeds of sales 1,664 98,277
At December 31, 2003, the cost of investments for federal income tax
purposes was $842,349. Accumulated net unrealized appreciation on
investments was $70,581, consisting of $71,589 gross unrealized
appreciation and $1,008 gross unrealized depreciation.
3. Trust Shares -- The Declaration of Trust permits the Trust to issue an
unlimited number of no par value shares of beneficial interest of the fund.
4. Advisory Fee and Other Transactions With Affiliates -- Certain officers
and trustees of the Trust are officers and directors of its investment
adviser, First Investors Management Company, Inc. ("FIMCO"), its
underwriter, First Investors Corporation ("FIC"), its transfer agent,
Administrative Data Management Corp. ("ADM") and/or First Investors Federal
Savings Bank ("FIFSB"), custodian of the Trust's individual retirement
accounts ("IRA"). Trustees of the Trust who are not "interested persons" of
the Trust as defined in the 1940 Act are remunerated by the Fund. For the
year ended December 31, 2003, total trustees fees accrued by the Fund
amounted to $300.
The Investment Advisory Agreement provides as compensation to FIMCO, an
annual fee, payable monthly, at the rate of 1% of the first $200 million of
the Fund's average daily net assets, .75% on the next $300 million,
declining by .03% on each $250 million thereafter, down to .66% on average
daily net assets over $1 billion. For the year ended December 31, 2003,
FIMCO has voluntarily waived management fees in excess of 0.60% and assumed
other expenses in excess of 0.50%. For the year ended December 31, 2003,
the total advisory fee accrued to FIMCO was $9,786 of which $3,914 was
waived. In addition, FIMCO assumed $9,113 of other expenses.
For the year ended December 31, 2003, shareholder servicing costs included
$1,415 in transfer agent fees paid to ADM and $497 in IRA custodian fees
paid to FIFSB.
Notes to Financial Statements (continued)
FIRST INVESTORS U.S. GOVERNMENT PLUS FUND -- 1ST FUND
December 31, 2003
5. Tax Components of Capital and Distributions to Shareholders --
Distributions to shareholders on a tax basis during the years ended
December 31, 2003 and 2002 were as follows:
2003 2002
-------- --------
Ordinary Income $71,594 $73,929
Long-Term Capital Gains 10,933 30,036
-------- --------
$82,527 $103,965
======== ========
As of December 31, 2003, the components of distributable earnings on a tax
basis were $70,581 consisting entirely of unrealized appreciation.
For the year ended December 31, 2003, the Fund reclassified $2 from net
investment income and $14 from accumulated net realizes gains to capital
paid in to reflect permanent differences between book and tax reporting.
Financial Highlights
FIRST INVESTORS U.S. GOVERNMENT PLUS FUND -- 1st FUND
The following table sets forth the operating performance data for a share
of beneficial interest outstanding, total return, ratios to average net
assets and other supplemental data for each year indicated.
Year Ended December 31
-----------------------------------------------------
2003 2002 2001 2000 1999
-------- -------- -------- -------- ---------
Per Share Data
- --------------
Net Asset Value, Beginning of Year $8.59 $8.97 $9.06 $8.88 $10.23
======== ======== ======== ======== =========
Income from Investment Operations:
Net Investment Income .663 .695 .682 .680 .681
Net Realized and Unrealized
Gain (Loss) on Investments (.539) (.098) .002 .317 (1.205)
-------- -------- -------- -------- ---------
Total from Investment Operations .124 .597 .684 .997 (.524)
-------- -------- -------- -------- ---------
Less Distributions from:
Net Investment Income .663 .695 .682 .681 .681
Net Realized Gains .101 .282 .092 .136 .145
-------- -------- -------- -------- ---------
Total Distributions .764 .977 .774 .817 .826
-------- -------- -------- -------- ---------
Net Asset Value, End of Year $7.95 $8.59 $8.97 $9.06 $8.88
======== ======== ======== ======== =========
Total Return (%)+ 1.44 6.65 7.55 11.22 (5.12)
- ------------
Ratios/Supplemental Data
- ------------------------
Net Assets, End of Year (in thousands) $941 $1,017 $1,098 $1,093 $1,090
Ratio to Average Net Assets (%)*:
Expenses 1.10 1.10 1.10 1.10 1.10
Net Investment Income 7.32 7.08 7.04 7.18 6.65
Ratio to Average Net Assets Before Expenses
Waived or Assumed (%):
Expenses 2.45 2.61 2.24 2.26 2.08
Net Investment Income 5.97 5.57 5.90 6.02 5.67
Portfolio Turnover Rate (%) 0 2 0 0 1
+ Calculated without sales charges
* Net of expenses waived or assumed (Note 4)
See notes to financial statements
Independent Auditors' Report
To the Shareholders and Trustees of
First Investors U.S. Government Plus Fund -- 1st Fund
We have audited the accompanying statement of assets and liabilities,
including the portfolio of investments, of the 1st Fund of First Investors
U.S. Government Plus Fund as of December 31, 2003, and the related
statement of operations for the year then ended, the statement of changes
in net assets for each of the two years in the period then ended and the
financial highlights for each of the five years in the period then ended.
These financial statements and financial highlights are the responsibility
of the Trust's management. Our responsibility is to express an opinion on
these financial statements and financial highlights based on our audits.
We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. 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 December 31,
2003, by correspondence with the custodian. 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 1st Fund of First Investors U.S. Government Plus Fund as of December
31, 2003, and the results of its operations for the year then ended,
changes in its net assets for each of the two years in the period then
ended and the financial highlights for each of the five years in the period
then ended, in conformity with accounting principles generally accepted in
the United States of America.
Tait, Weller & Baker
Philadelphia, Pennsylvania
February 2, 2004
FIRST INVESTORS U.S. Government Plus Fund -- 1st FUND
Trustees and Officers*
Position
Held with Principal Number of Other
Fund and Occupation Portfolios in Trusteeships/
Name, Date of Birth Length of During Past Fund Complex Directorships
and Address Service 5 Years Overseen Held
- ------------ ------- ------- -------- ----
DISINTERESTED TRUSTEES
Robert M. Grohol 1/16/1932 Trustee None/Retired 50 None
c/o First Investors since 6/30/00
Management Company, Inc.
95 Wall Street
New York, NY 10005
Rex R. Reed 3/19/1922 Trustee None/Retired 50 None
c/o First Investors since 3/31/84
Management Company, Inc.
95 Wall Street
New York, NY 10005
Herbert Rubinstein 6/14/1921 Trustee None/Retired 50 None
c/o First Investors since 9/20/79
Management Company, Inc.
95 Wall Street
New York, NY 10005
James M. Srygley 10/17/1932 Trustee Owner 50 None
c/o First Investors since 1/19/95 Hampton
Management Company, Inc. Properties
95 Wall Street
New York, NY 10005
Robert F. Wentworth 7/5/1929 Trustee None/Retired 50 None
c/o First Investors since 10/15/92
Management Company, Inc.
95 Wall Street
New York, NY 10005
FIRST INVESTORS U.S. Government Plus Fund -- 1st FUND
Trustees and Officers* (continued)
Position(s)
Held with Principal Number of Other
Fund and Occupation(s) Portfolios in Trusteeships/
Name, Date of Birth Length of During Past Fund Complex Directorships
and Address Service 5 Years Overseen Held
- ------------ ------- ------- -------- ----
INTERESTED TRUSTEES**
Glenn O. Head 8/16/1925 Trustee Chairman of 50 None
c/o First Investors since 1968 First Investors
Management Company, Inc. Corporation,
95 Wall Street Chairman of
New York, NY 10005 First Investors
Consolidated
Corporation,
Chairman of
First Investors
Management
Company, Inc.,
Chairman of
Administrative Data
Management Corp.,
and officer of
other affiliated
companies***
Kathryn S. Head 12/31/1955 Trustee Vice President 50 None
c/o First Investors since 3/17/94 of First Investors
Management Company, Inc. Corporation,
581 Main Street President of
Woodbridge, NJ 07095 President First Investors
since 11/15/01 Consolidated
Corporation,
President of
First Investors
Management
Company, Inc.,
President of
Administrative Data
Management Corp.,
Chairman of
First Investors
Federal Savings
Bank and
officer of
other affiliated
companies***
Larry R. Lavoie 9/12/1947 Trustee General Counsel 50 None
c/o First Investors since 9/17/98 First Investors
Management Company, Inc. Corporation
95 Wall Street and other
New York, NY 10005 affiliated
companies***
John T. Sullivan 1/18/1932 Trustee Of Counsel 50 None
c/o First Investors since 9/20/79 Hawkins,
Management Company, Inc. Delafield &
95 Wall Street Wood; Director
New York, NY 10005 and Chairman
of Executive
Committee of
First Investors
Corporation
* Each Trustee serves for an indefinite term with the Funds, until
his/her successor is elected.
** Mr. Head and Ms. Head are interested trustees because (a) they are
indirect owners of more than 5% of the voting stock of the adviser and
principal underwriter of the Funds, and (b) they are officers,
directors and employees of the adviser and principal underwriter of the
Funds. Ms. Head is an officer of the Funds and the daughter of Mr.
Head. Mr. Lavoie is an interested trustee of the Funds because he
indirectly owns securities issued by and is an officer of the adviser
and principal underwriter of the Funds. Mr. Sullivan is an interested
trustee because he is a director and Chairman of the Executive
Committee of First Investors Corporation and he indirectly owns
securities issued by the adviser and principal underwriter of the Funds.
*** Other affiliated companies consist of: First Investors Realty
Company, Inc., First Investors Life Insurance Company, First Investors
Leverage Corporation, Route 33 Realty Corporation, First Investors
Credit Funding Corporation, N.A.K. Realty Corporation, Real Property
Development Corporation, School Financial Management Services, Inc.,
First Investors Federal Savings Bank, First Investors Credit
Corporation and First Investors Resources, Inc.
FIRST INVESTORS U.S. Government Plus Fund -- 1st FUND
Trustees and Officers* (continued)
Position
Held with Principal Number of Other
Fund and Occupation Portfolios in Trusteeships/
Name, Date of Birth Length of During Past Fund Complex Directorships
and Address Service 5 Years Overseen Held
- ------------ ------- ------- -------- ----
OFFICER(S) WHO ARE NOT TRUSTEES
Joseph I. Benedek 8/2/1957 Treasurer Treasurer 50 None
c/o First Investors since 1988 and Principal
Management Company, Inc. Accounting Officer
581 Main Street
Woodbridge, NJ 07095
FIRST INVESTORS U.S. GOVERNMENT PLUS FUND
Shareholder Information
- -----------------------
Investment Adviser
First Investors Management Company, Inc.
95 Wall Street
New York, NY 10005
Underwriter
First Investors Corporation
95 Wall Street
New York, NY 10005
Custodian
The Bank of New York
One Wall Street
New York, NY 10286
Transfer Agent
Administrative Data Management Corp.
581 Main Street
Woodbridge, NJ 07095-1198
Legal Counsel
Kirkpatrick & Lockhart LLP
1800 Massachusetts Avenue, N.W.
Washington, DC 20036
Auditors
Tait, Weller & Baker
1818 Market Street
Philadelphia, PA 19103
It is the Fund's practice to mail only one copy of its annual and
semi-annual reports to any address at which more than one shareholder with
the same last name has indicated that mail is to be delivered. Additional
copies of the reports will be mailed if requested by any shareholder in
writing or by calling 800-423-4026. The Fund will ensure that separate
reports are sent to any shareholder who subsequently changes his or her
mailing address.
This report is authorized for distribution only to existing shareholders,
and, if given to prospective shareholders, must be accompanied or preceded
by the Fund's prospectus.
Item 2. Code of Ethics
The Registrant's Board of Directors/Trustees ("Board") has
adopted a Code of Ethics that applies to the First Investors Funds'
("Funds") principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing
similar functions, regardless of whether these individuals are employed
by the Funds or a third party. The Code of Ethics is attached to this
report as Exhibit A.
During the period of the report, there have been no amendments to the
Code of Ethics or waivers, implicit or otherwise, from its provisions.
Item 3. Audit Committee Financial Expert - Filed herewith
The independent director currently serving as the audit committee
financial expert is Robert F. Wentworth.
The Registrant's Board has unanimously determined that Mr. Wentworth
satisfied the definition of an audit committee financial expert as
set forth in the instructions to Form N-CSR under the Investment
Company Act of 1940. Specifically, the Board determined that
Mr. Wentworth has all of the following: (i) an understanding of
generally accepted accounting principles and financial
statements; (ii) the ability to assess the general application of such
principles in connection with the accounting for estimates, accruals,
and reserves; (iii) experience preparing, auditing, analyzing or
evaluating financial statements that present the breadth and level of
complexity of accounting issues that are generally comparable to the
breadth and complexity of issues that can reasonably be expected to be
raised by the Funds' financial statements, or experience actively
supervising one or more persons engaged in such activities; (iv) an
understanding of internal controls and procedures for financial reports;
and (v) an understanding of audit committee functions. Furthermore, he
had acquired these attributes through education and many years of
relevant experience in various financial positions with American
Telephone and Telegraph Company, including the positions of
Director - Accounting, Director - Finance, Director - Financial
Reporting and Analysis, Controller, and Director of Business Planning.
Mr. Wentworth also has many years experience serving on the Audit
Committees of First Investors Funds and other organizations. Finally,
Mr. Wentworth is independent as defined in the instructions to the Form.
Item 4. Principal Accountant Fees and Services
Fiscal Year Ended
December 31,
-----------------
2003 2002
---- ----
(a) Audit Fees $4,250 $4,000
(b) Audit-Related Fees $ 0 $ 0
(c) Tax Fees $2,500 $2,500
Nature of fees: tax returns preparation and tax compliance
(d) All Other Fees $ 0 $ 0
(e)(1) Audit committee's pre-approval policies
The Audit Committee has adopted a charter under which it has the duties,
among other things,
(a) to pre-approve, and to recommend to the full Board, the
selection, retention or termination of the independent auditors to
provide audit, review or attest services to the Funds and, in
connection therewith, evaluate the independence of the auditors and to
obtain the auditors' specific representations as to their independence;
(b) to pre-approve all non-audit services to be provided to the
Funds by the independent auditor;
(c) to pre-approve all non-audit services to be provided by the
Funds' independent auditor to the Funds' investment adviser or to any
entity that controls, is controlled by or is under common control with
the Funds investment adviser and that provides ongoing services to the
Funds, if the engagement relates directly to the operations and
financial reporting of the Funds;
(d) to establish, if deemed necessary or appropriate as an
alternative to Audit Committee pre-approved of services to be provided
by the independent auditor as required by paragraphs (b) and (c) above,
policies and procedures to permit such services to be pre-approved by
other means, such as by action of a designated member and members of
the Audit Committee, subject to subsequent Committee review and
oversight;
(e) to meet with the Funds' independent auditors, including
meetings without management representatives, as necessary (i) to review
the arrangements for, and scope of, the annual audit, any special audits
and any other services to be provided to the Fund's by the auditors;
(ii) to discuss any matters of concern relating to the Fund's financial
statements, including any adjustments to such statements recommended by
the auditors, or other results of said audit(s); and (iii) to review the
form of opinion the auditors propose to render to the Board and
shareholders;
(f) to receive and consider (i) information and comments from the
auditors with respect to the Funds' accounting and financial reporting
policies, procedures and internal control over financial reporting
(including the Funds' critical accounting policies and practices) and
to consider management's responses to any such comments; (ii) reports
from the auditors regarding any material written communications between
the auditors and management; and (iii) reports from the auditors
regarding all non-audit services provided to any entity in the Funds'
investment company complex that were not pre-approved by the Audit
Committee or pursuant to pre-approved policies and procedures
established by the Audit Committee and associated fees;
(g) to review and approve the fees charged by the auditors for
audit and non-audit services for the Funds; and
(h) to report its activities to the full Board on a regular basis
and to make such recommendations with respect to the above and other
matters as the Audit Committee may deem necessary or appropriate.
(e)(2) None, or 0%, of the services relating to the Audit-Related Fees,
Tax Fees and All Other Fees paid by the Registrant and Related Entities
disclosed above were approved by the audit committee pursuant to paragraph
(c)(7)(i)(C) of Rule 2-01 of Regulation S-X (which permits audit committee
approval after the start of the engagement with respect to services other
than audit review or attest services, if certain conditions are satisfied).
(f) Not Applicable
(g) Aggregate non-audit fees billed by the Registrant's accountant
for services rendered to the Registrant and the Registrant's investment
adviser or any entity controlling, controlled by, or under common
control with the adviser that provides ongoing services to the
Registrant for the two fiscal years ended December 31, 2003 and 2002
were $35,000 and $32,000, respectively.
(h) Not Applicable
Item 5. Audit Committee of Listed Registrant
Audit Committe Members -
Robert M. Grohol
Rex R. Reed
Herbert Rubinstein
James M. Srygley
Robert F. Wentworth
Item 6. [Reserved]
Item 7. Disclosure of Proxy Voting Policies & Procedures for Closed-End
Management Investment Companies
Not applicable to the Registrant
Item 8. [Reserved]
Item 9. Controls and Procedures
(a) The Registrant's Principal Executive Officer and Principal
Financial Officer have concluded that the Registrant's disclosure controls
and procedures (as defined in Rule 30a-3(c) under the Investment Company
Act of 1940, as amended) are effective, based on their evaluation of these
disclosure controls and procedures as of a date within 90 days of the
filing date of this report.
(b) There were no significant changes in the Registrant's internal
controls or in other factors that could significantly affect these controls
subsequent to the date of their evaluation, including any corrective actions
with regard to significant deficiencies and material weaknesses.
Item 10. Exhibits
(a) Code of Ethics - Filed herewith
(b) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act
of 2002 - Filed herewith
(c) 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.
First Investors U.S. Government Plus Fund
(Registrant)
By /S/ KATHRYN S. HEAD
Kathryn S. Head
President and Principal Executive Officer
Date: March 1, 2004
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.
First Investors U.S. Government Plus Fund
(Registrant)
By /S/ JOSEPH I. BENEDEK
Joseph I. Benedek
Treasurer and Principal Financial Officer
Date: March 1, 2004