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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT
COMPANIES
REGISTRATION NO. 33-87498
811-08910
VINTAGE MUTUAL FUNDS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
1415 28th STREET, SUITE 200
WEST DES MOINES, IOWA 50266
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
AMY M. MITCHELL, TREASURER
VINTAGE MUTUAL FUNDS, INC.
1415 28th STREET, SUITE 200
WEST DES MOINES, IOWA 50266
(NAME AND ADDRESS OF AGENT FOR SERVICE)
COPIES OF ALL COMMUNICATIONS TO:
VERA LICHTENBERGER, ESQ. JOHN C. MILES, ESQ., DONALD F. BURT, ESQ.
VINTAGE MUTUAL FUNDS, INC. CLINE, WILLIAMS, WRIGHT, JOHNSON & OLDFATHER
1415 28th STREET, SUITE 200 1900 U.S. BANK BUILDING, 233 S. 13TH STREET
WEST DES MOINES, IOWA 50266 LINCOLN, NEBRASKA 68508
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (515) 244-5426
DATE OF FISCAL YEAR END: 03/31/2006
DATE OF REPORTING PERIOD: 03/31/2006
ITEM 1. REPORTS TO STOCKHOLDERS.
ANNUAL REPORT FOR THE PERIOD ENDING MARCH 31, 2006.
VINTAGE
MUTUAL FUNDS
----------------------------------------------
ANNUAL
REPORT
TO
SHAREHOLDERS
MARCH 31, 2006
TABLE OF CONTENTS
Performance Reports and Schedules of Portfolio Investments
Page 4
Statements of Assets and Liabilities
Page 31
Statements of Operations
Page 35
Statements of Changes in Net ssets
Page 37
Notes to Financial Statements
Page 43
Financial Highlights
Page 52
Independent Auditors' Report
Page 56
Directors and Officers
Page 57
Additional Information
Page 59
Message From the President Vintage Mutual Funds, Inc.
Dear Shareholder:
We are pleased to present this annual report for the Vintage Mutual Funds
covering the 12-month period from April 1, 2005 through March 31, 2006.
During the 12-month period the investment management team managed well through a
tightening in Federal Monetary policy. As a result of sound strategic
positioning, the bond funds finished another strong year of relative
performance. Rising interest rates hinder bond total returns, but increase
income opportunities. The next year will continue to be difficult to navigate in
the bond market as interest rates continue to drift higher. Uncertainty
surrounding domestic and global economic growth, inflation, and consumer trends
will likely create some volatility.
The Vintage money market funds will continue to benefit from a tighter monetary
policy supported by the Federal Reserve. The Federal Reserve's ability to
balance growth with inflation will be the key determinant as to how high
short-term rates rise. As the Fed Funds target rate increases so will the yields
on the money market funds. In the last twelve months, short-term interest rates
have risen more than 2 percent. With this volatility and uncertainty, we
recommend you view the financial markets from a long-term perspective, measured
in years rather than weeks or months.
This year brought changes to our family of funds. Shareholders of our three
equity funds (Balanced, Equity, and Growth) approved a merger into the Federated
Funds as of September 19, 2005. Each Vintage Fund's shareholders approved a new
investment advisory agreement which was required by the sale of the Investment
Adviser, Investors Management Group, by AMCORE Investment Group, N.A. to West
Bancorporation on December 30, 2005.
In closing I would like to thank you for your confidence and loyalty in the
Vintage Mutual Funds. Our daily motivation is driven by the desire to deliver
strong and consistent performance on your behalf.
/s/ Jeff Lorenzen
Jeff D. Lorenzen, CFA
President, Vintage Mutual Funds, Inc.
The Vintage Mutual Funds are distributed by BISYS Fund Services Limited
Partnership.
Shares of the Vintage Mutual Funds are NOT INSURED BY THE FDIC. Investment
products involve investment risk, including the possible loss of principal. Past
performance is not predictive of future results, and the composition of each
Fund's portfolio is subject to change.
Information not authorized for distribution unless accompanied or preceded by a
current prospectus. An investor should consider the Funds' investment
objectives, risks, charges, and expenses carefully before investing or sending
money. This and other important information about the investment company can be
found in the Funds' prospectus. To obtain more information, please call
1-800-798-1819 or visit the website www.VintageFunds.com. Please read the
prospectus carefully before investing.
1
Message From the Investment Adviser Vintage Mutual Funds, Inc.
Dear Shareholders,
This year the markets continued to send mixed signals about the US economy. The
Federal Reserve (Fed) has raised rates fifteen times since their shift in
monetary policy. The Fed, in our minds, is reaching the end of their policy
accommodations. The Fed Funds target rate has finally reached a level consistent
with historical perspectives which meet moderate growth expectations.
The first quarter of 2006 economic results presented few surprises. The softer
Gross Domestic Product (GDP) report from the fourth quarter will likely be
offset by higher GDP in the first quarter. Consensus estimates indicate first
quarter GDP growth will be 4.6 percent. Consumer spending remained strong while
employment data remained positive. In addition, oil prices hovered in the mid
$60 range, inflation was stable, and the Fed responded with another 25 basis
point hike in the discount rate. Although not anticipated to be down, the equity
market posted stronger than expected gains on overall favorable earnings.
First quarter consumer spending was strong, climbing almost 5 percent. Much of
the strong consumer trends are being driven by strong employment. Employment
trends continue to be positive, with the unemployment rate declining to 4.7
percent in March. Also first quarter unemployment claims averaged about 300,000,
low by historical standards. The number of new jobs created in March was 211,000
and in the past twelve months over 2 million. Employment growth remains quite
healthy. Consumer spending should remain strong into the second quarter as
employment trends continue to remain positive. Concern surrounding higher
interest rates will eventually spook consumers but we expect several quarters
will pass before this occurs.
Throughout the first quarter energy price volatility has been mixed, oil prices
fluctuated between the upper $50s and $60s before finishing at $67 a barrel. A
continuation of prices in the mid $60s is likely due to continuing strong global
oil demand and modest declines in inventory levels in recent weeks. In addition,
production outages in Nigeria, concerns regarding Iran, and longer than expected
shut-ins in the Gulf of Mexico support a price level in the mid $60s. Prices
above $70 a barrel will likely shift sentiment and cause short-term disruptions
in spending.
In contrast, natural gas prices have declined by nearly 30 percent since the
beginning of the year. A warmer than expected January and growth in storage
levels over the past several months contributed to the decline. However, longer
than expected shut-ins in the Gulf of Mexico and recent modest storage declines
are supporting natural gas prices at the current level.
Despite continued increases in commodity prices (especially metals), overall
inflation remains in check, with Core Consumer Price Index (CPI) averaging about
2.1 percent. While inflation has remained contained, elements exist that could
begin to push inflation higher. Capacity utilization has almost reached the
levels of the late 1990s. Utilization rates reached 81.2 percent in February,
which is the area that normally spurs business capital spending to increase
capacity through construction and machinery orders. Likewise, the labor market
is showing signs of reaching the point where a drop in the unemployment rate is
expected to push labor costs higher. This is already being seen in
year-over-year average hourly earnings which continues to move higher. With
continued strong labor and rising demand overseas, inflation has the potential
to increase over the next several quarters and vigilance is still needed.
2
In light of strong economic growth, monetary policy is continuing as expected.
Specifically, the Fed increased the discount rate another 25 basis points in
March, bringing the current Fed Funds target rate to 4.75 percent. Many expect
the Fed to raise the rate one more time in May, likely by 25 basis points, then
pause as the economy moves through the summer and into the fall. The possibility
of further rate increases will depend mostly on the pace of future economic
growth, which will be heavily influenced by the effects of past rate hikes,
higher energy prices, general employment growth, and inflationary pressures.
It is likely that second quarter GDP growth will be softer than the first
quarter. However, growth should remain strong and provide a backdrop for asset
appreciation. The second quarter will likely provide higher interest rates which
will eventually impact equity prices, slowing their pace of appreciation.
Meanwhile, the Treasury yield curve will likely remain flat for some time as
economic growth continues in light of tightening monetary policy.
In summary, the equity market should continue to perform well in the near term
as earnings in general have remained strong, however higher interest will
eventually impair valuations. The current rising interest rate environment will
cause bond funds to perform below historical norms. By late year, return
expectations for bond investors will likely improve as interests stabilize. Cash
investors will continue to benefit from a rising Fed Funds rate resulting in
higher yields on their investments.
In closing, regardless of the economic situation or the fund in which you have
invested, we will continue to manage your money as if it were our own and strive
for consistent, above-market, long-term returns.
/s/ Jeff Lorenzen
Jeff D. Lorenzen, CFA
President & Chief Investment Officer
Investors Management Group
3
PERFORMANCE REPORT
VINTAGE MONEY MARKET FUNDS
The Federal Reserve raised overnight rates in May for the sixteenth consecutive
meeting, reaching 5.00 percent and refusing to speculate on a deadline for
ending the rate hike cycle. Money market yields rose in sympathy and the money
market yield curve flattened with longer rates rising less than shorter rates.
As GDP growth remains strong and labor markets tighten, the potential for
excessive inflation rises and keeps the Fed engaged in the cycle. The results of
each Fed meeting will be highly data-dependent, leaving investors to read the
tea leaves for signs of decelerating growth. The end of Fed activity should come
in 2006, but the terminal date is difficult to predict given recent economic
strength.
THE GOVERNMENT ASSETS FUND
The Fund's average days fell during the quarter and ended the quarter slightly
short the index. Agencies cheapened offering better relative value over
Treasurys. The Fund is currently adding agency paper in the four to six month
part of the curve where rates appear most attractive.
THE INSTITUTIONAL RESERVES FUND
The Fund's average days fell during the quarter and ended the quarter even with
the index. Agencies cheapened offering better relative value over Treasurys. The
Fund is currently adding agency paper in the four to six month part of the curve
where rates appear most attractive.
INSTITUTIONAL MONEY MARKET FUND
The Fund has grown over the period, though it remains invested exclusively in
overnight repurchase agreements. Some short term paper was invested and matured
during the quarter. As assets grow and become more permanent, longer term agency
paper will be added to the portfolio.
THE LIQUID ASSETS FUND
Very short corporate paper is relatively rich reflecting strong corporate
fundamentals. The Fund's average days were roughly even to the index at the end
of the period, although rate resets on April 1 for many of the FmHA loans drove
days longer. The Fund is currently adding agency paper in the four to six month
part of the curve where rates appear most attractive.
THE MUNICIPAL ASSETS FUND
The municipal money market yield curve rose along with its taxable counterparts,
though the curve remains fairly flat. Floating rate notes decreased as a
percentage of the Fund as longer term paper offered advantageous yields. Average
days ended the period slightly longer than the index and the Fund is looking for
opportunities in municipal commercial paper to improve yield.
AN INVESTMENT IN THE VINTAGE MONEY MARKET FUNDS IS NOT INSURED OR GUARANTEED BY
THE FEDERAL DEPOSIT INSURANCE CORPORATION (FDIC) OR ANY OTHER GOVERNMENT AGENCY.
ALTHOUGH THE FUNDS SEEK TO PRESERVE THE VALUE OF YOUR INVESTMENT OF $1.00 PER
SHARE, IT IS POSSIBLE TO LOSE MONEY BY INVESTING IN THE FUNDS.
4
VINTAGE MUTUAL FUNDS, INC.
Government Assets Fund
Schedule of Portfolio Investments
March 31, 2006
Par Value Description Value
--------- ----------- -----
U.S. GOVERNMENT AGENCIES (40.10%)
Federal Farm Credit Bank
2,000,000 4.561% *** 04/04/06 $ 1,999,997
1,800,000 3.000% 06/27/06 1,793,219
2,000,000 4.650% ** 07/19/06 2,000,000
Federal Home Loan Bank
500,000 2.125% 07/07/06 496,564
1,500,000 3.250% 08/11/06 1,491,276
1,000,000 2.875% 08/15/06 992,083
1,000,000 2.130% 09/25/06 988,151
100,000 4.000% 09/29/06 99,594
175,000 2.375% 10/30/06 172,622
1,000,000 4.230% 11/28/06 995,526
1,575,000 4.610% **** 09/06/07 1,574,095
1,000,000 4.720% ***** 11/21/07 1,000,000
1,000,000 4.760% ** 11/28/07 1,000,000
Federal Home Loan Mortgage Corporation
1,000,000 4.084% * 04/04/06 999,667
1,424,000 4.100% ****** 08/16/06 1,423,043
1,000,000 3.625% 09/15/06 994,804
592,000 5.085% * 02/06/07 567,170
Federal National Mortgage Association
1,000,000 2.150% 04/13/06 999,359
500,000 2.250% 05/15/06 498,650
1,000,000 5.250% 06/15/06 1,001,485
1,000,000 1.750% 06/16/06 994,158
900,000 3.300% 07/14/06 896,791
1,000,000 4.995% * 08/23/06 980,680
-----------
Total U.S. Government Agencies 23,958,934
-----------
Repurchase Agreements (59.96%)
Bear Stearns and Company, Inc.
13,000,000 4.820% 4/3/2006 $ 13,000,000
(Purchased on 03/31/06, proceeds at
maturity $13,005,222; Collateralized
by $13,535,601 Government Agencies,
09/01/20 - 09/01/33, market value
$13,261,169)
Seattle-Northwest Securities Corporation
12,824,737 4.810% 04/03/06 12,824,737
(Purchased on 03/31/06, proceeds at
maturity $12,829,878; Collateralized
by $13,090,000 Government Agencies,
08/11/06 - 02/22/07, market value
$13,085,032)
UBS Securities LLC
10,000,000 4.760% 4/3/2006 10,000,000
(Purchased on 03/31/06, proceeds at
maturity $10,003,967; Collateralized
by $9,854,000 Government Agencies,
05/02/06 - 10/01/28, market value
$10,204,433)
-------------
Total Repurchase Agreements 35,824,737
-------------
Total Investments in Securities
(100.06%) (Cost $59,783,671) $ 59,783,671
Other Assets and Liabilities (-0.06%) ($36,498)
--------------
Net Assets (100.00%) $ 59,747,173
==============
* Effective yield at date of purchase
** Interest rate fluctuates weekly with 3-month US Treasury bill rate
*** Interest rate is Libor plus a stated rate
**** Interest rate flucuates monthly with 2-year US Treasury note
***** Interest rate flucuates monthly with 1-year US Treasury note
******Step-coupon, resets quarterly
See notes to financial statements.
5
VINTAGE MUTUAL FUNDS, INC.
Institutional Money Market Fund
Schedule of Portfolio Investments
March 31, 2006
Par Value Description Value
- --------- ----------- -----
REPURCHASE AGREEMENTS (100.00%)
Bear Stearns and Company, Inc.
33,000,000 4.820% 04/03/06 33,000,000
(Purchased on 03/31/06, proceeds
at maturity $33,013,255;
Collateralized by $33,906,376
Government Agency Pools, 03/01/16 - 04/01/36,
market value $33,662,356)
Seattle-Northwest Securities Corporation
30,487,753 4.810% 04/03/06 30,487,753
(Purchased on 03/31/06, proceeds
at maturity $30,499,974;
Collateralized by $31,383,000
Government Agencies, 05/17/06 - 05/15/13,
market value $31,097,951)
------------
Total Repurchase Agreements 63,487,753
------------
Total Investments in Securities
(100.00%) (Cost $63,487,753) $ 63,487,753
Other Assets and Liabilities (0.00%) ($1,394)
------------
NET ASSETS (100.00%) $ 63,486,359
============
See notes to financial statements.
6
VINTAGE MUTUAL FUNDS, INC.
Institutional Reserves Fund
Schedule of Portfolio Investments
March 31, 2006
Par Value Description Value
--------- ----------- -----
U.S. GOVERNMENT AGENCIES (52.36%)
Federal Farm Credit Bank
1,000,000 4.561% *** 04/04/06 $ 999,998
1,000,000 4.650% ** 07/19/06 1,000,000
200,000 4.520% *** 08/01/06 199,913
204,167 3.050% 08/25/06 202,972
Federal Home Loan Bank
500,000 2.125% 07/07/06 496,564
1,465,000 2.020% 07/14/06 1,455,412
500,000 2.875% 08/15/06 496,042
230,000 4.185% 09/22/06 230,000
500,000 2.130% 09/25/06 494,075
500,000 2.615% 02/07/07 489,414
1,000,000 4.610% **** 09/06/07 999,426
1,000,000 4.720% ***** 11/21/07 1,000,000
1,000,000 4.760% ** 11/28/07 1,000,000
Federal Home Loan Mortgage Corporation
1,000,000 4.084% * 04/04/06 999,667
544,000 2.340% 04/28/06 543,220
2,000,000 2.260% 06/09/06 1,991,288
1,000,000 5.500% 07/15/06 1,001,923
2,000,000 3.625% 09/15/06 1,989,607
Federal National Mortgage Association
1,000,000 2.150% 04/13/06 999,359
2,000,000 2.125% 04/15/06 1,998,360
1,500,000 2.250% 05/15/06 1,495,950
2,610,000 4.665% ****** 05/22/06 2,609,872
1,000,000 4.782% * 08/09/06 983,118
500,000 4.995% * 08/23/06 490,340
------------
Total U.S. Government Agencies 24,166,520
------------
REPURCHASE AGREEMENTS (47.73%)
Bear Stearns and Company Inc.
9,000,000 4.820% 4/3/2006 $ 9,000,000
(Purchased on 03/31/06, proceeds
at maturity $9,003,615;
Collateralized by $9,527,287
Government Agencies, 03/01/18 - 12/01/35,
market value $9,184,452)
Seattle-Northwest Securities Corporation
7,030,456 4.810% 4/3/2006 7,030,456
(Purchased on 03/31/06, proceeds
at maturity $7,033,274;
Collateralized by $7,112,000
Government Agencies, 08/11/06 -04/05/07,
market value $7,175,704)
UBS Securities LLC
6,000,000 4.760% 4/3/2006 6,000,000
(Purchased on 03/31/06, proceeds
at maturity $6,002,380;
Collateralized by $5,788,000
Government Agencies, 12/15/06 - 01/19/23,
market value $6,122,124)
--------------
Total Repurchase Agreements 22,030,456
--------------
Total Investments in Securities
(100.09%) (Cost $46,196,976) $ 46,196,976
Other Assets and Liabilites (-0.09%) ($42,010)
--------------
NET ASSETS (100.00%) $ 46,154,966
==============
* Effective yield at date of purchase
** Interest rate fluctuates weekly with 3-month US Treasury bill rate
***Interest rate is Libor plus a stated rate
****Interest rate flucuates monthly with 2-year US Treasury note
*****Interest rate flucuates monthly with 1-year US Treasury note
******Interest rate flucuates quarterly with Libor
See notes to financial statements.
7
VINTAGE MUTUAL FUNDS, INC.
Liquid Assets Fund
Schedule of Portfolio Investments
March 31, 2006
Par Value Description Value
--------- ----------- -----
U.S. GOVERNMENT AGENCIES (15.65%)
Federal Farm Credit Bank
2,000,000 4.650% ** 07/19/06 $ 2,000,040
2,500,000 2.850% 09/07/06 2,478,483
Federal Home Loan Bank
2,000,000 4.050% 06/06/06 2,000,000
3,100,000 2.030% 06/30/06 3,079,454
1,000,000 2.800% 08/25/06 991,793
100,000 2.875% 09/15/06 99,088
1,000,000 2.600% 09/26/06 989,458
400,000 3.000% 11/15/06 395,398
200,000 6.350% 12/04/06 201,875
1,000,000 4.610% ***** 09/06/07 999,426
1,000,000 4.720% ****** 11/21/07 1,000,000
Federal Home Loan Mortgage Corporation
2,000,000 2.750% 05/17/06 1,995,472
990,000 2.700% ******** 05/19/06 987,396
1,500,000 2.000% 06/30/06 1,490,400
Federal National Mortgage Association
2,000,000 2.125% 06/15/06 1,989,941
------------
Total U.S. Government Agencies 20,698,224
------------
LOAN CERTIFICATES - FMHA GUARANTEED LOAN
CERTIFICATES (14.46%)
19,118,296 4.85 % - 5.55%*********
04/01/06 to 3/11/45 19,118,296
--------------
COMMERCIAL PAPER (19.33%)
Danske Corporation
1,000,000 4.578% * 04/06/06 $ 999,368
1,000,000 4.856% * 06/08/06 990,915
UBS Finance
1,000,000 4.515% * 04/10/06 998,883
1,000,000 4.640% * 04/24/06 997,061
1,000,000 4.865% * 06/06/06 991,163
National Rural Utilities
1,500,000 4.605% * 04/10/06 1,498,282
PNC Bank
1,300,000 4.609% * 04/10/06 1,298,508
1,300,000 4.776% * 06/07/06 1,288,580
Cooperative Association Tractor
1,010,000 4.629% * 04/20/06 1,007,558
1,500,000 4.970% * 07/11/06 1,479,379
BNP Paribas Financial
1,000,000 4.500% * 04/10/06 998,888
1,000,000 4.617% * 04/20/06 997,583
1,000,000 4.900% * 06/28/06 988,169
Paccar Financial
1,000,000 4.518% * 05/15/06 994,341
1,500,000 4.727% * 05/24/06 1,489,665
* Effective yield at date of purchase
** Interest rate fluctuates weekly with 3-month US Treasury bill rate
***Variable rate, put option subject to no longer than 7-day settlement
****Interest rate is Libor plus a stated rate
*****Interest rate flucuates monthly with 2-year US Treasury note
******Interest rate flucuates monthly with 1-year US Treasury note
******* Interest rate flucuates quarterly with Libor
********Step-coupon, resets quarterly
*********Interest rate fluctuates with prime rate, put option subject to no
longer than 7-day setttlement
See notes to financial statements.
8
VINTAGE MUTUAL FUNDS, INC.
Liquid Assets Fund (continued)
Schedule of Portfolio Investments
March 31, 2006
Par Value Description Value
--------- ----------- -----
COMMERCIAL PAPER (CONT.)
Citigroup Funding
1,000,000 4.694% * 05/16/06 $ 994,200
1,500,000 4.718% * 05/17/06 1,491,049
Southern Company
1,499,000 4.748% * 04/10/06 1,497,224
Thunder Bay Funding
1,200,000 4.674% * 04/18/06 1,197,365
Edison Asset Securities
578,000 4.555% * 04/25/06 576,266
Northern Rock
1,800,000 4.676% * 04/28/06 1,793,736
1,000,000 4.835% * 05/22/06 993,200
------------
Total Commercial Paper 25,561,383
------------
CORPORATE BONDS (22.41%)
Aerospace - Defense
General Dynamics
2,000,000 2.125% 05/15/06 1,994,286
McDonnell Douglas
1,500,000 6.875% 11/01/06 1,514,224
Banking & Financial
Wells Fargo Company
1,416,000 6.875% 04/01/06 1,416,000
Norwest Corporation
995,000 6.875% 08/08/06 1,000,871
Wachovia Corporation
2,000,000 4.950% 11/01/06 2,000,513
HSBC USA Inc
1,500,000 8.375% 02/15/07 1,538,625
Chemicals
EI DuPont de Nemours
268,000 8.250% 09/15/06 272,096
Computer Hardware
Hewlett-Packard Company
1,000,000 5.750% 12/15/06 1,004,196
Drugs
Abbott Laboratories
1,004,000 5.625% 07/01/06 1,006,244
Financial Services
Morgan Stanley Dean Witter
3,476,000 6.100% 04/15/06 3,477,955
National Rural Utilities
1,230,000 6.000% 05/15/06 1,231,981
* Effective yield at date of purchase
** Interest rate fluctuates weekly with 3-month US Treasury bill rate
***Variable rate, put option subject to no longer than 7-day settlement
****Interest rate is Libor plus a stated rate
*****Interest rate flucuates monthly with 2-year US Treasury note
******Interest rate flucuates monthly with 1-year US Treasury note
******* Interest rate flucuates quarterly with Libor
********Step-coupon, resets quarterly
*********Interest rate fluctuates with prime rate, put option subject to no
longer than 7-day setttlement
See notes to financial statements.
9
VINTAGE MUTUAL FUNDS, INC.
Liquid Assets Fund (continued)
Schedule of Portfolio Investments
March 31, 2006
Par Value Description Value
--------- ----------- -----
Household Finance
1,131,000 7.200% 07/15/06 1,138,757
Credit Suisse FB USA
2,500,000 5.875% 08/01/06 2,509,104
General Electric Capital
1,000,000 5.060% ******* 09/18/06 1,000,791
Bear Stearns Company
1,000,000 7.250% 10/15/06 1,011,046
Goldman Sachs Group
1,000,000 2.850% 10/27/06 989,379
Bear Stearns Company
1,000,000 4.711% **** 01/05/07 1,000,000
Merrill Lynch & Company
1,655,000 4.755% ******* 01/26/07 1,656,559
Miscellaneous
Schneider Capital
1,900,000 4.780% *** 07/01/43 1,900,000
Kuehn Enterprises
970,000 4.780% *** 10/01/43 970,000
Retail General Merchandise
Wal-Mart Stores
1,000,000 5.586% 06/01/06 1,001,537
------------
Total Corporate Bonds 29,634,164
------------
REPURCHASE AGREEMENTS (29.84%)
Seattle-Northwest Securities Corporation
14,465,121 4.810% 04/03/06 14,465,121
(Purchased on 03/31/06, proceeds at
maturity $14,470,919; Collateralized
by $14,910,000 Government Agencies,
07/15/06 - 02/15/07, market value
$14,755,711)
Bear, Stearns and Company, Inc.
15,000,000 4.820% 04/03/06 15,000,000
(Purchased on 03/31/06, proceeds at
maturity $15,006,025; Collateralized
by $15,316,905 Government Agency Pools,
03/01/18 - 04/01/36, market value
$15,301,780)
UBS Securities LLC
10,000,000 4.760% 04/03/06 10,000,000
(Purchased on 03/31/06, proceeds
at maturity $10,003,967;
Collateralized by $10,295,000
Government Agencies, 04/03/06 -
06/27/06, market value
$10,200,651)
------------
Total Repurchase Agreements 39,465,121
------------
Total Investment in Securities
(101.69%) (Cost $134,477,188) $134,477,188
Other Assets and Liabilities (-1.69 ($2,229,360)
------------
NET ASSETS (100.00%) $132,247,828
============
* Effective yield at date of purchase
** Interest rate fluctuates weekly with 3-month US Treasury bill rate
***Variable rate, put option subject to no longer than 7-day settlement
****Interest rate is Libor plus a stated rate
*****Interest rate flucuates monthly with 2-year US Treasury note
******Interest rate flucuates monthly with 1-year US Treasury note
******* Interest rate flucuates quarterly with Libor
********Step-coupon, resets quarterly
*********Interest rate fluctuates with prime rate, put option subject to no
longer than 7-day setttlement
See notes to financial statements.
10
VINTAGE MUTUAL FUNDS, INC.
Municipal Assets Fund
Schedule of Portfolio Investments
March 31, 2006
Par Value Description Value
--------- ----------- -----
MUNICIPAL BONDS (98.86%)
Arkansas (0.74%)
135,000 Hot Springs, AR
4.250% 07/01/06 $ 135,271
Arizona (2.19%)
400,000 Apache County, AZ Development
3.160%*** 12/15/18 400,000
California (1.09%)
200,000 California Health
3.180%*** 08/01/21 200,000
Florida (2.81%)
500,000 Florida Housing Finance Agency
5.700% 08/01/06 514,228
Hawaii (5.46%)
1,000,000 ABN AMRO MuniTOPS, HI
3.220%*** 07/01/12 1,000,000
Iowa (4.84%)
100,000 Iowa Finance Authority
5.000% 08/01/06 100,589
785,000 Iowa Finance West Foundation
Project, 3.200%*** 01/01/32 785,000
Idaho (2.73%)
500,000 Idaho State University
4.000% 04/01/06 500,000
Illinois (7.49%)
300,000 Illinois Regional Transportation
4.000% 06/01/06 300,566
315,000 LaSalle County School District, IL
5.900% 12/01/06 319,901
150,000 Cook County, IL School District #142
3.350% 12/01/06 150,195
300,000 Illinois Health NW Hospital
3.220%*** 08/15/25 300,000
300,000 Illinois Development Finance
Authority, 3.220%*** 12/01/28 300,000
Indiana (2.19%)
400,000 Indianapolis, IN
3.180%*** 02/01/20 400,000
Kentucky (1.10%)
200,000 Kentucky Asset.Liability
Commission, 4.000% 06/28/06 200,556
Louisiana (2.73%)
500,000 Louisiana State
5.500% 04/15/06 500,420
Maryland (3.28%)
600,000 Maryland Health and Higher
Education, 3.200%*** 10/01/37 600,000
Michigan (1.10%)
200,000 Hudsonville, MI Schools
6.000% 05/01/06 200,519
Minnesota (1.24%)
225,000 Minnesota State
5.000% 08/01/06 226,325
Nebraska (3.55%)
650,000 Nebraska Educational Finance
Authority, 3.240%** 12/15/35 650,000
New Jersey (1.09%)
200,000 New Jersey Economic
Development, 3.140%** 11/01/25 200,000
New Mexico (1.64%)
300,000 New Mexico Severance Tax
4.500% 07/01/06 300,956
New York (1.09%)
200,000 Long Island Power Authority, NY
3.180%** 05/01/33 200,000
* Effective Yield at date of purchase
** Variable Rate, put option subject to no longer than next business day
*** Variable Rate, put option subject to no longer than 7 day settlement
**** Tax Exempt Commercial Paper - Interest Bearing at Maturity (rollover
Eligible)
See notes to financial statements.
11
VINTAGE MUTUAL FUNDS, INC.
Municipal Assets Fund (continued)
Schedule of Portfolio Investments
March 31, 2006
Par Value Description Value
--------- ----------- -----
MUNICIPAL BONDS (CONT.)
Ohio (5.93%)
785,000 Cincinnati & Hamilton Counties, OH
3.240%** 09/01/25 $ 785,000
300,000 Ohio State University
3.150%*** 12/01/31 300,000
Pennsylvania (18.52%)
100,000 Penn Manor School District, PA
4.850%, 06/01/06 100,222
685,000 Erie County, PA Hospital
3.120%** 05/15/20 685,000
300,000 Delaware County, PA Development
3.170%** 04/01/21 300,000
305,000 New Castle, PA Hospital
3.230%*** 07/01/26 305,000
500,000 Philadelphia, PA IDR
3.120%** 03/01/27 500,000
400,000 Allentown, PA Development
3.120%** 12/01/29 400,000
100,000 Benzinger Township, PA
3.210%*** 12/01/30 100,000
300,000 Chester County, PA Development
3.120%** 07/01/31 300,000
700,000 Allegheny County, PA Development
3.200%*** 08/01/32 700,000
Tennessee (9.29%)
300,000 Metro Nashville, TN
5.250% 05/15/06 300,871
700,000 Clarksville, TN Building
3.170%** 07/01/31 700,000
700,000 Montgomery County, TN
3.170%** 04/01/32 700,000
Texas (6.20%)
500,000 Austin, TX Commercial Paper
3.110%**** 05/01/06 500,000
Texas (6.20%) (continued)
235,000 Texas A&M University
4.650% 05/15/06 235,464
400,000 Harris County, TX IDR
3.220%*** 02/01/20 400,000
Utah (1.64%)
300,000 Emery County, Utah PCR
3.180%** 11/01/24 300,000
Virginia (0.55%)
100,000 Virginia State
4.500% 10/01/06 100,537
Washington (4.91%)
200,000 Seattle, WA Refunding
3.000% 10/01/06 199,457
700,000 Lake Tapps Parkway, WA
3.220%*** 12/01/19 700,000
Wisconsin (1.09%)
200,000 Wisconsin State
4.700% 05/01/06 200,283
Wyoming (4.37%)
800,000 Sweetwater County, WY
Commercial Paper, 3.290% 06/05/06 800,000
------------
Total Municipal Bonds 18,096,360
------------
MUTUAL FUNDS (0.72%)
131,010 AIM Institutional Tax Free
Cash Reserve, 2.960%** 04/01/06 131,010
------------
Total Investments in Securities
(99.58%) (Cost $18,227,370) $ 18,227,370
Other Assets and Liabilities (0.42%) 76,587
------------
NET ASSETS (100.00%) $ 18,303,957
============
* Effective Yield at date of purchase
** Variable Rate, put option subject to no longer than next business day
*** Variable Rate, put option subject to no longer than 7 day settlement
**** Tax Exempt Commercial Paper - Interest Bearing at Maturity (rollover
Eligible)
See notes to financial statements.
12
PERFORMANCE REPORT VINTAGE MUTUAL FUNDS, INC.
VINTAGE FIXED INCOME FUNDS
During the past twelve months, the economy has proven resilient to many
challenges and financial assets have increased in value. As a result of the
continued economic growth trajectory, equity markets moved higher as the
Standard & Poor's 500 index advanced 11.73 percent and a muted response from the
fixed income markets as the Lehman Aggregate index rose 2.26 percent. Interest
rates moved higher during the year on continued strength in the labor market and
further interest rate hikes by the Federal Reserve. The ten-year U.S. Treasury
rate rose 0.37 percent to finish the period at 4.85 percent.
The Federal Reserve continued to increase the Fed funds rate at each meeting
over the past twelve months. The Federal Reserve funds rate has moved from 2.75
percent in March 2005 to 4.75 percent in March 2006. The March 2006 meeting
marked the fifteenth consecutive 0.25 percent rate increase. The Federal Reserve
shared with investors their key drivers of taking the economy's temperature as
to inflation. In addition to inflation expectations, the Federal Reserve
indicated resource utilization rates, energy and other commodity price increases
and the growth in unit labor costs to be the main drivers. Each of these
economic measures is at or near the point where further growth generally leads
to higher inflation. As core inflation is holding steady near the high end of
the Federal Reserve's preferred range of 1 - 2 percent, vigilance is still
needed.
The Federal Reserve's interest rate hikes have been supported by continued
growth in economic output and employment. Economic growth, as measured by the
Gross Domestic Product (GDP), has advanced at an above-trend pace over the past
twelve months. The national unemployment rate declined from 5.10 percent to 4.70
percent throughout the year. Likewise, the average number of jobs created is
174,000 per month throughout the last twelve months. A falling unemployment rate
indicates this amount of job creation is sufficient to absorb new workers
entering the workforce.
In addition to domestic issues, the global economy and interest rate markets
impact U.S. interest rates. Changes are afoot within many of the world's biggest
central banks. Not only has the U.S. been on a multi-year interest rate hike
campaign, other central banks are concerned about resource utilization and
particularly inflation. German business confidence is at the highest level in
fifteen years and retail sales are growing at the fastest pace since 1999. In
Japan the picture is even brighter with four consecutive months of inflation and
a jobless rate at a 7 1/2 year low. The European Central Bank began increasing
rates during the first quarter and the Bank of Japan is signaling an end to its
deflation fighting quantitative easing campaign. These are all signs of global
growth and indicate global interest rates may be moving higher. This matters to
U.S. domestic investors because the major rate markets show a significant degree
of correlation. Since 1990, ninety-three percent of the change in ten-year U.S.
yields can be explained by changes in Germany's interest rates. Likewise, the
U.S. has a ninety-one percent correlation to the United Kingdom and an
eighty-nine percent correlation to Japan. A move higher in rates for both the
Euro zone and Japan will certainly put upward pressure on U.S. interest rates.
Interest rates rose across all maturities over the past year. Short-term
interest rates moved more than intermediate and long rates, causing the yield
curve to significantly flatten. On March 31, 2006, the two-year Treasury yield
was 4.82 percent. Investors were compensated only an additional .03 percent or
4.85 percent for purchasing ten-year Treasury notes. While many market
prognosticators suggested that this flattening of the yield curve and minor
inversion during the first quarter of 2006 sowed the seeds for an impending
recession, we have been much more optimistic about the economic outlook despite
movements in the Treasury market. Given the low overall level of interest rates,
the amount of wind taken out of the economic sails due to the Federal Reserve's
rate hike campaign has been less than many expected.
13
Our outlook for the fixed income markets is for modestly higher interest rates,
the Federal Reserve to move policy rates higher should the economy remain at an
above-trend growth rate and modest performance from the risk sectors of the
fixed income universe. This outlook is supported by four main themes: consistent
economic growth, sustained corporate profitability, continued job growth and
moderate rates of inflation. Consumer spending (more than two-thirds of the
economy) is buoyed by increasing employment and has taken higher energy costs in
stride. Corporate profit growth and high profit margins generate the ability to
pay for capital expenditures.
In summary, we see the economy to be on solid footing and expect the Federal
Reserve to remain vigilant on the risk of inflation. The impact of a tightening
Federal Reserve and higher oil prices may place strain on yet unidentified
sectors of the market. The portfolios are defensively positioned for a higher
interest rate environment with a focus on capital preservation.
VINTAGE LIMITED TERM BOND FUND
Fixed income total returns were modest during the past twelve months as interest
rates rose and bond prices fell, eroding the Fund's income benefits. The
ten-year Treasury reached a low of 3.89 percent during the summer of 2005, only
to move higher throughout the fall and winter months. The ten-year Treasury
reached its peak for the past year at the end of the period with a yield of 4.85
percent. For the period, the Vintage Bond Fund outperformed its benchmark before
expenses, yet trailed after expenses.
The continued path of economic growth and job creation led the Federal Reserve
to raise the Federal Reserve funds rate eight more times during the past twelve
months. As expected, the Federal Reserve increased rates at a "measured" pace,
moving 0.25 percent in each move. The Federal Reserve's focus is on resource
utilization rates, energy and other commodity price increases and the growth in
unit labor costs as the main drivers of inflation. Each of these economic
measures is at or near the point where further growth generally leads to higher
inflation.
As the Federal Reserve proceeded with interest rate hikes, short-term interest
rates moved higher during the period. The two-year Treasury rate increased 1.04
percent while the ten-year rate moved higher by a more modest 0.37 percent. The
result is a flattening of the yield curve between two-year and ten-year rates.
The difference between these two rates collapsed by 0.67 percent as their
difference is now a modest 0.03 percent. The market certainly believes in the
inflation fighting ability of the Federal Reserve as it allocates little extra
income for extending a maturity out to ten years.
Portfolio performance during the period benefited from nimble duration
management, an overweight to the asset-backed securities sector, effective
trading of the mortgage-backed sector and an income advantage relative to the
benchmark. Mortgage-backed securities performed poorly throughout most of 2005
and were an underweight position. In December 2005, the portfolio added CMO's
prior to a mortgage rally through the winter months of 2006. Return dispersion
among bond sectors was muted for the period. Corporate bonds securities modestly
underperformed the market while mortgage-backed securities, high quality
asset-backed securities and U.S. agencies modestly outperformed. The portfolio
had less interest rate risk than the benchmark, which benefited performance as
interest rates moved higher. In total, active investment decisions enhanced
performance in a low total return environment.
Investment strategy is focused on holding less interest rate risk than the
benchmark and continues to hold an overweight in fixed income sectors that
generate an income advantage over the index. Corporate bonds and asset-backed
securities continue to hold overweight positions. Mortgage-backed securities
weightings are slightly above benchmark levels. U.S. Treasury allocations
continue to possess a significant underweight. An expectation of sustained
economic and job growth supports the strategy.
14
Performance Report Limited Term Bond Fund
Graph Omitted - Information presented
Value of $10,000 Investment
Average Annual Returns
as of 3/31/2006
1 Year 5 Year 10 Year Value
------ ------ ------- -----
Vintage Limited Term Bond Fund 2.31% 2.68% 4.02% $14,840
Lehman Brothers 1-3 Yr Gov't/Credit Index 2.50% 3.64% 5.07% $16,398
PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE; PAST PERFORMANCE IS NOT
PREDICATIVE OF FUTURE RESULTS. THE VALUE OF SHARES IN THE VINTAGE MUTUAL FUNDS
WILL FLUCTUATE SO THAT THE SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN
THEIR ORIGINAL COST. THE COMPOSITION OF THE FUND'S HOLDINGS IS SUBJECT TO
CHANGE. PERFORMANCE DATA CURRENT TO THE MOST RECENT MONTH END MAY BE OBTAINED BY
ACCESSING THE WEBSITE AT WWW.VINTAGEFUNDS.COM.
Bond funds will tend to experience smaller fluctuations in value than stock
funds. However, investors in any bond fund should anticipate fluctuations in
price, especially for longer-term issues and in an environment of rising
interest rates.
The performance of the Vintage Limited Term Bond Fund is measured against the
Lehman Brothers 1-3 Year Government/Credit Index which represents the
performance of government and corporate bonds with maturities of 1-3 years. The
index is unmanaged and does not reflect the deduction of fees associated with a
mutual fund, such as investment management fees. The Fund's performance reflects
the deduction of fees for these value-added services. The performance table and
graph do not reflect the deduction of taxes that a shareholder would pay on fund
distributions or redemption of fund shares.
15
VINTAGE MUTUAL FUNDS, INC.
Limited Term Bond Fund
Schedule of Portfolio Investments
March 31, 2006
Par Value Description Value
- --------- ----------- -----
U.S. GOVERNMENT AGENCIES (28.32%)
1,000,000 Federal Home Loan Bank, 3.375%
9/14/2007 $ 976,441
6,600,000 Federal Home Loan Mortgage Corp.,
3.875%, 06/15/08 6,437,706
3,000,000 Federal Home Loan Mortgage Corp.,
5.750%, 03/15/09 3,052,293
800,000 Federal National Mortgage Assoc.,
5.250%, 04/15/07 800,878
1,000,000 Federal National Mortgage Assoc.,
4.300%, 6/30/08 983,977
52,500 Naples City SA Sink, 7.520%
7/15/2006 52,813
400,000 Quebec Province, 7.000%
1/30/2007 405,656
------------
Total U.S. Government Agencies 12,709,764
------------
MORTGAGE RELATED SECURITIES (34.77%)
Airlines (0.52%)
235,415 Continental Airlines Certs, 6.410%
4/15/2007 234,756
------------
Collateralized Mortgage Obligations (5.15%)
1,103,389 Federal Home Loan Mortgage Corp.,
2971 Class PE, 4.500%, 03/15/26 1,082,002
963,053 Federal Home Loan Mortgage Corp.,
3089 Class LP, 5.500%, 12/15/29 960,111
2,890 Federal National Mortgage Assoc.,
1993-14 Class A, 6.000%, 02/25/08 2,886
209,521 Structured Asset Securities Corp.,
2001-1B2, 7.142%, 02/25/31 208,739
57,076 Structured Asset Securities Corp.,
5.330%, 04/25/32 56,813
------------
2,310,551
------------
Federal Home Loan Mortgage Corp.
Mortgage-Backed Pools (11.14%)
872,071 Pool #M90830, 3.500%
8/1/2008 833,331
1,232,730 Pool #M90842, 4.000%
09/01/08 1,199,092
707,970 Pool #M90876, 4.000%
11/01/08 688,651
511,181 Pool #M90877, 4.000%
12/1/2008 497,231
25,934 Pool #E61274, 7.000%
8/1/2009 26,191
875,201 Pool #M90980, 5.000%
5/1/2010 870,026
887,985 Pool #M90988, 5.000%
7/1/2010 882,734
-------------
4,997,256
-------------
Asset Backed Securities (17.96%)
220,212 Indymac 1998-2 A2, 6.170%
12/25/11 211,744
211,744 1,742 Vanderbilt Mortgage, 7.820%
11/07/17 1,740
2,795 Oakwood Mortgage 6.600%
05/15/21 2,789
1,200,000 Chase Mortgage 2003-6 1A3, 3.340%
05/25/26 1,179,036
341,623 Green Tree, 7.350%
05/15/27 352,790
587,454 Amresco 1997-2 M1F, 7.430%
06/25/27 585,281
278,206 Green Tree, 7.600%
10/15/27 287,280
287,280 133,521 Residential Asset Mortgage Products,
1999-KS4, 7.220%, 06/25/28 133,466
38,115 IMC Home Equity, 7.080%
08/20/28 38,004
800,000 Residentail Asset Mortgage Products,
2004-RS12 AI3, 3.981%, 04/25/29 789,278
133,102 First Alliance, 6.520%
09/20/29 132,680
990,986 Countrywide 2004-9 AF3, 3.854%
10/25/1930 985,315
See notes to financial statements.
16
VINTAGE MUTUAL FUNDS, INC.
Limited Term Bond Fund (continued)
Schedule of Portfolio Investments
March 31, 2006
Par Value Description Value
- --------- ----------- -----
MORTGAGE RELATED SECURITIES (CONT.)
Asset Backed Securities (cont.)
37,704 Conseco Financial Series, 7.272%
6/15/1932 $ 38,018
1,110,000 Chase Mortgage 2003-4 1A5, 5.416%
5/25/1933 1,096,886
350,000 Residential Asset Mortgage Products
2005-RS1, 4.109%, 01/25/35 342,065
625,000 Countrywide ABS, 4.575%
5/25/1935 615,930
1,300,000 POPLR 2005-B AF3, 4.620%
8/25/1935 1,267,284
------------
8,059,586
------------
Total Mortgage Related Securities 15,602,149
------------
MUNICIPAL BONDS (1.35%)
General Obligation
40,000 Reeves County, TX, 6.800%
6/1/2006 40,122
500,000 Chemeketa, OR, 1.940%
6/15/2006 497,090
------------
537,212
------------
Rev Bond - Education
65,000 Azusa Pacific University, 7.250%
4/1/2009 66,398
------------
Total Municipal Bonds 603,610
------------
CORPORATE BONDS (33.95%)
Airlines (0.40%)
178,789 Southwest Airlines, 5.100%
5/1/2006 178,772
------------
Automotive Finance (0.66%)
300,000 Daimler Chrysler NA, 4.750%
1/15/2008 295,796
------------
Banking & Financial (4.19%)
400,000 General Electric Cap Corp, 5.000%
2/15/2007 399,439
300,000 JP Morgan Chase, 5.250%
5/30/2007 299,528
300,000 CIT Group Inc, 5.750%
09/25/07 301,818
300,000 Bank of America Corp, 3.875%
01/15/08 293,052
300,000 U.S. Bank NA, 4.125%
03/17/08 293,973
300,000 Wells Fargo Company, 4.000%
08/15/08 291,902
-------------
1,879,712
-------------
Banks- International (0.64%)
300,000 Wachovia Corp, 3.500%
08/15/08 288,792
-------------
Beverages (0.87%)
400,000 Diageo Capital PLC, 3.500%
11/19/07 388,719
-------------
Electric Utility (3.57%)
1,000,000 LA Electric Inc, 6.950%
06/21/06 1,004,054
300,000 Duke Energy Corp, 3.750%
03/05/08 291,482
304,000 Arkansas Electric, 7.330%
06/30/08 308,636
-------------
1,604,172
-------------
Financial Services (9.17%)
300,000 Ford Motor, 6.500%
01/25/07 298,852
300,000 GE Capital, 5.375%
03/15/07 300,338
400,000 Morgan Stanley, 5.800%
04/01/07 401,828
200,000 John Deere Corp, 3.625%
05/25/07 196,298
300,000 General Motors Acceptance Credit,
6.125%, 08/28/07 290,978
400,000 Goldman Sachs Group, 4.125%
01/15/08 392,137
300,000 Washington Mutual Finance, 4.375%
01/15/08 294,966
See notes to financial statements.
17
VINTAGE MUTUAL FUNDS, INC.
Limited Term Bond Fund (continued)
Schedule of Portfolio Investments
March 31, 2006
Par Value Description Value
- --------- ----------- -----
CORPORATE BONDS (CONT.)
Financial Services (cont)
400,000 Household Finance Co, 4.625%
1/15/2008 $ 395,811
300,000 Lehman Bros, 4.000%
1/22/2008 293,366
600,000 Citigroup Inc, 3.500%
2/1/2008 581,971
400,000 Countrywide Home Loan, 3.250%
5/21/2008 382,769
300,000 American General Financial AIG, 2.750%
6/15/2008 283,406
------------
4,112,720
------------
Food Products (1.36%)
300,000 Campbell Soup, 5.500%
3/15/2007 299,298
300,000 Kroger Co, 7.450%
3/1/2008 310,032
------------
609,330
------------
Forest Products (0.90%)
400,000 Weyerhaeuser Co, 5.950%
11/1/2008 403,679
------------
Manufactured Capital Goods (0.90%)
400,000 Tyco Intl Group, 6.125%
11/1/2008 405,422
------------
Media (4.82%)
400,000 Cox Communications Inc, 7.750%
8/15/2006 402,901
450,000 Tribune Co, 6.875%
11/1/2006 453,004
300,000 AOL Time Warner, 6.150%
5/1/2007 302,249
400,000 Comcast Cable Communications, 8.375%
5/1/2007 412,311
300,000 Disney Company, 5.375%
6/1/2007 300,064
300,000 Gannett Company, 4.125%
6/15/2008 291,367
------------
2,161,896
------------
Mining (0.88%)
400,000 Alcoa Inc, 4.250%
08/15/07 $ 393,951
------------
Oil & Gas (0.67%)
300,000 Marathon Oil Corp, 5.375%
6/1/2007 300,155
------------
Real Estate Investement Trust (0.68%)
300,000 Simon Property Group REIT, 6.375%
11/15/2007 304,343
------------
Retail General Merchandise (1.08%)
400,000 Target Corp, 5.500%
4/1/2007 400,879
85,000 May Department Stores, 3.950%
7/15/2007 83,224
------------
484,103
------------
Telecommunications (3.17%)
300,000 AT&T Wireless, 7.500%
6/1/2007 306,818
300,000 Telus Corp, 7.500%
6/1/2007 306,779
500,000 Verizon Corp, 6.125%
6/15/2007 504,402
300,000 Sprint Corp, 6.125%
11/15/2008 305,320
------------
1,423,319
------------
Total Corporate Bonds 15,234,881
------------
MUTUAL FUND (1.02%)
458,698 Vintage Government Assets Fund
T-Shares, 3.845%* 458,698
-------------
Total Investments in Securities
(99.41%) (Cost $45,294,382) $ 44,609,102
Other Assets & Liabilities (0.59%) 264,715
-------------
NET ASSETS (100.00%) $ 44,873,817
=============
*Rate shown is as of March 31, 2006
See notes to financial statements.
18
PERFORMANCE REPORT VINTAGE MUTUAL FUNDS, INC.
THE VINTAGE BOND FUND
Fixed income total returns were modest during the past twelve months as interest
rates rose and bond prices fell, eroding the Fund's income benefits. The
two-year Treasury reached a low of 3.48 percent during the summer of 2005, only
to move higher throughout the fall and winter months. The two-year Treasury
reached its peak for the past year in March 2006 with a yield of 4.84 percent.
For the period, the Vintage Limited Term Bond Fund outperformed its benchmark
before expenses, yet trailed after expenses.
The continued path of economic growth and job creation led the Federal Reserve
to raise the Federal Reserve funds rate eight more times during the past twelve
months. As expected, the Federal Reserve increased rates at a "measured" pace,
moving 0.25 percent in each move. The Federal Reserve's focus is on resource
utilization rates, energy and other commodity price increases and the growth in
unit labor costs as the main drivers of inflation. Each of these economic
measures is at or near the point where further growth generally leads to higher
inflation.
As the Federal Reserve proceeded with interest rate hikes, short-term interest
rates moved higher during the period. The two-year Treasury rate increased 1.04
percent while the ten-year rate moved higher by a more modest 0.37 percent. The
result is a flattening of the yield curve between two-year and ten-year rates.
The difference between these two rates collapsed by 0.67 percent as their
difference is now a modest 0.03 percent. The market certainly believes in the
inflation fighting ability of the Federal Reserve as it allocates little extra
income for extending a maturity out to ten years.
Portfolio performance during the period benefited from nimble duration
management, an overweight to the asset-backed securities and mortgage-backed
securities sectors, and an income advantage relative to the benchmark. Return
dispersion among bond sectors was muted for the period. Corporate bonds
securities modestly underperformed the market while mortgage-backed securities,
high quality asset-backed securities and U.S. agencies modestly outperformed.
The portfolio had less interest rate risk than the benchmark, which benefited
performance as interest rates moved higher. In total, active investment
decisions enhanced performance in a low total return environment.
Investment strategy is focused on holding less interest rate risk than the
benchmark and continues to hold an overweight in fixed income sectors that
generate an income advantage over the index. Corporate bonds, asset-backed
securities and mortgage-backed securities continue to hold overweight positions.
U.S. Treasury allocations continue to possess a significant underweight. An
expectation of sustained economic and job growth supports the strategy.
19
Performance Report Bond Fund
Graph Omitted - Information presented
Value of $10,000 Investment
Average Annual Returns
as of 3/31/2006
1 Year 5 Year 10 Year Value
------ ------ ------- -----
Vintage Bond Fund 1.67% 3.98% 5.56% $17,182
Lehman Brothers Aggregate Index 2.26% 5.11% 6.32% $18,450
PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE; PAST PERFORMANCE IS NOT
PREDICATIVE OF FUTURE RESULTS. THE VALUE OF SHARES IN THE VINTAGE MUTUAL FUNDS
WILL FLUCTUATE SO THAT THE SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN
THEIR ORIGINAL COST. THE COMPOSITION OF THE FUND'S HOLDINGS IS SUBJECT TO
CHANGE. PERFORMANCE DATA CURRENT TO THE MOST RECENT MONTH END MAY BE OBTAINED BY
ACCESSING THE WEBSITE AT WWW.VINTAGEFUNDS.COM.
Bond funds will tend to experience smaller fluctuations in value than stock
funds. However, investors in any bond fund should anticipate fluctuations in
price, especially for longer-term issues and in an environment of rising
interest rates.
The performance of the Vintage Bond Fund is compared to the Lehman Brothers
Aggregate Index, which represents the performance of the overall bond market.
The index is unmanaged and does not reflect the deduction of fees associated
with a mutual fund, such as investment management fees. The Fund's performance
reflects the deduction of fees for these value-added services. The performance
table and graph do not reflect the deduction of taxes that a shareholder would
pay on fund distributions or the redemption of fund shares.
20
VINTAGE MUTUAL FUNDS, INC.
BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
MARCH 31, 2006
Par Value Description Value
- --------- ----------- -----
U.S. TREASURY NOTES (2.09%)
1,170,000 U.S. Treasury Note, 3.625%
5/15/2013 $ 1,084,261
980,000 U.S. Treasury Note, 4.000%
2/15/2014 924,033
--------------
Total U.S. Treasury Notes 2,008,294
--------------
U.S. TREASURY STRIPS (4.69%)
1,810,000 U.S Treasury Strip, 0.00%
11/15/2015 1,133,120
2,200,000 U.S Treasury Strip, 0.00%
11/15/2018 1,168,283
2,410,000 U.S Treasury Strip, 0.00%
5/15/2020 1,178,890
2,720,000 U.S Treasury Strip, 0.00%
8/15/2025 1,023,702
--------------
Total U.S. Treasury Strips 4,503,995
--------------
U.S. GOVERNMENT AGENCIES (5.70%)
300,000 Federal Home Loan Mortgage Corp.,
7.000%, 03/15/10 319,708
730,000 Federal Home Loan Mortgage Corp.,
6.750%, 09/15/29 865,022
2,040,000 Federal National Mortgage Assoc.,
4.500%, 06/01/10 1,983,096
500,000 Federal National Mortgage Assoc.,
6.125%, 03/15/12 523,675
1,210,000 Federal National Mortgage Assoc.,
4.625%, 10/15/14 1,165,376
500,000 Federal National Mortgage Assoc.,
7.125%, 01/15/30 619,354
--------------
Total U.S. Government Agencies 5,476,231
--------------
OTHER GOVERNMENT RELATED (1.26%)
25,000 Naples City SA Sink,
7.520%, 07/15/06 25,149
185,000 Nova Scotia,
8.250%, 11/15/19 233,652
500,000 Quebec Province MTN,
7.035%, 03/10/26 582,692
360,000 United Mexican States,
6.750%, 09/27/34 371,700
--------------
Total Other Government Related 1,213,193
--------------
MORTGAGE RELATED SECURITIES (51.57%)
Collateralized Mortgage Obligation (4.49%)
1,925,000 Federal Home Loan Mortgage Corp.,
3076 Class PC, 5.500%, 11/15/25 $ 1,921,233
170,845 Federal Home Loan Mortgage Corp.,
2123 Class PE, 6.000%, 12/15/27 171,522
39,431 Federal Home Loan Mortgage Corp.,
2535 Class PL, 4.000%, 06/15/29 39,235
1,070,969 Structured Asset Securities Corp.
2001-1 B2, 7.142%, 02/25/31 1,066,972
1,150,320 Washington Mutual 2003-AR4 A6,
3.423%, 05/25/33 1,117,634
-----------
4,316,596
-----------
Federal Home Loan Mortgage Corp. Pool (13.48%)
476,700 Pool #M90876, 4.000%, 11/01/08 463,692
84,950 Pool #E00436, 7.000%, 06/01/11 87,423
995,122 Pool #E01419, 5.500%, 05/01/18 989,332
90,453 Pool #E99510, 5.500%, 09/01/18 89,898
2,226,913 Pool #E01488, 5.000%, 10/01/18 2,174,866
1,183,809 Pool #E01545, 5.000%, 01/01/19 1,155,883
97,080 Pool #G80135, 7.000%, 10/25/24 100,608
71,853 Pool #C00592, 7.000%, 03/01/28 74,069
129,990 Pool #C19588, 6.500%, 12/01/28 133,144
75,587 Pool #C00896, 7.500%, 12/01/29 79,071
61,734 Pool #C53696, 7.000%, 06/01/31 63,616
876,180 Pool #G01444, 6.500%, 08/01/32 895,586
114,369 Pool #C72044, 6.500%, 10/01/32 116,832
141,901 Pool #C76748, 6.000%, 02/01/33 142,065
909,572 Pool #C01491, 6.000%, 02/01/33 910,993
909,309 Pool #C78237, 5.500%, 04/01/33 889,574
1,582,560 Pool #G01563, 5.500%, 06/01/33 1,548,213
426,927 Pool #A19963, 5.500%, 03/01/34 417,471
877,079 Pool #G08010, 5.500%, 09/01/34 857,653
901,128 Pool #G01772, 5.000%, 02/01/35 858,980
950,758 Pool #G01896, 5.000%, 09/01/35 904,840
-----------
12,953,808
-----------
Federal National Mortgage Assoc. Pool (18.17%)
518,340 Pool #254473, 5.500%, 10/01/17 515,721
1,125,806 Pool #254759, 4.500%, 06/01/18 1,078,650
1,109,153 Pool #254802, 4.500%, 07/01/18 1,062,694
265,015 Pool #255079, 5.000%, 02/01/19 258,895
1,057,203 Pool #742088, 4.500%, 04/01/19 1,011,786
See note to financial statements.
21
VINTAGE MUTUAL FUNDS, INC.
BOND FUND (CONTINUED)
SCHEDULE OF PORTFOLIO INVESTMENTS
MARCH 31, 2006
Par Value Description Value
- --------- ----------- -----
MORTGAGE RELATED SECURITIES (CONT.)
Federal National Mortgage Assoc. Pool (cont.)
210,341 Pool #240650, 7.500%, 07/01/21 $ 221,091
1,115,829 Pool #255075, 5.500%, 02/01/24 1,099,775
90,539 Pool #346287, 7.000%, 05/01/26 93,443
60,535 Pool #250990, 7.500%, 07/01/27 63,302
90,970 Pool #251614, 7.000%, 04/01/28 93,858
120,308 Pool #251697, 6.500%, 05/01/28 123,353
203,790 Pool #323282, 7.500%, 07/01/28 213,107
200,519 Pool #252334, 6.500%, 02/01/29 208,132
95,952 Pool #323640, 7.500%, 04/01/29 100,305
95,249 Pool #252518, 7.000%, 05/01/29 99,484
77,966 Pool #535817, 7.000%, 04/01/31 80,396
74,935 Pool #581592, 7.000%, 06/01/31 77,255
157,548 Pool #640002, 5.652%, 07/01/31 162,034
224,484 Pool #686168, 5.536%, 05/01/32 231,071
475,865 Pool #545759, 6.500%, 07/01/32 486,529
1,201,271 Pool #545993, 6.000%, 11/01/32 1,202,398
998,854 Pool #17315, 6.500%, 12/01/32 1,021,936
2,089,912 Pool #683387, 5.500%, 02/01/33 2,044,078
1,111,954 Pool #555272, 6.000%, 03/01/33 1,112,997
248,507 Pool #713974, 5.500%, 07/01/33 243,057
1,102,739 Pool #721502, 5.000%, 07/01/33 1,052,791
1,176,278 Pool #737730, 5.500%, 09/01/33 1,150,481
549,553 Pool #254905, 6.000%, 10/01/33 549,847
187,795 Pool #254982, 5.000%, 12/01/33 179,289
1,664,474 Pool #357467, 5.500%, 12/01/33 1,627,970
--------------
17,465,725
--------------
Government National Mortgage Association
Pool (2.80%)
71,313 Pool #780453, 7.500%, 12/15/25 75,012
113,511 Pool #780584, 7.000%, 06/15/27 118,435
57,183 Pool #451522, 7.500%, 10/15/27 60,088
166,427 Pool #22536, 7.500%, 01/20/28 173,415
127,590 Pool #780717, 7.000%, 02/15/28 133,171
121,468 Pool #462556, 6.500%, 02/15/28 126,079
77,997 Pool #469699, 7.000%, 11/15/28 81,333
16,232 Pool #466138, 7.500%, 12/15/28 17,045
171,570 Pool #780990, 7.500%, 12/15/28 180,247
81,525 Pool #780936, 7.500%, 12/15/28 85,733
102,926 Pool #486760, 6.500%, 12/15/28 106,834
1,523,182 Pool #23584, 6.000%, 07/20/34 1,536,503
--------------
2,693,895
--------------
Asset Backed Securities (12.63%)
440,424 Indymac 1998-2 A2,
6.170%, 12/25/11 423,488
201,074 Conti Mortgage 1999-1 A7,
6.470%, 12/25/13 199,970
1,310,000 Chase Mortgage 2003-6 1A3,
3.340%, 05/25/26 1,287,114
781,866 GreenTree 1996-3 A6,
7.850%, 05/15/27 818,509
587,454 Amresco 1997-2 M1F,
7.430%, 06/25/27 585,281
172,168 South Pacific 1998-1 A6,
7.080%, 03/25/28 171,516
83,527 Federal Home Loan Mortgage Corp.,
7.120%, 06/25/28 83,209
1,000,000 Residential Asset Mortgage Products
2004-RS12 AI3,3.981%, 04/25/29 986,597
1,532,216 Countrywide 2004-9 AF3,
3.854%, 10/25/30 1,523,449
310,781 ML Mortgage 2002-AFC1 AF3,
6.550%, 09/25/32 310,281
422,607 Equity One 2000-1 A5,
8.015%, 02/25/32 422,100
207,916 Conseco Finance 2000-6 A4,
6.770%, 09/01/32 208,122
1,000,000 Equity One,
6.039%, 11/25/32 997,434
1,160,000 CIT Group 2002-1 AF5,
6.710%, 02/25/33 1,170,239
1,100,000 Chase Mortgage 2003-4 1A5,
5.416%, 05/25/33 1,087,005
805,000 Countrywide ABS,
4.575%, 07/25/35 793,319
1,100,000 POPLR 2005-B AF3,
4.620%, 08/25/35 1,072,317
-----------
12,139,951
-----------
Total Mortgage Related Securities 49,569,976
-----------
See note to financial statements.
22
VINTAGE MUTUAL FUNDS, INC.
BOND FUND (CONTINUED)
SCHEDULE OF PORTFOLIO INVESTMENTS
MARCH 31, 2006
Par Value Description Value
- --------- ----------- -----
MUNICIPAL BONDS (2.64%)
General Obligation County / City / School
District Bonds (0.96%)
125,000 Fulton, MO Sink 7/08, 7.600%,
7/1/2011 $ 129,528
815,000 Oregon State G/O, 3.742%,
6/1/2008 790,338
--------------
919,866
--------------
Revenue Bond - Education (1.57%)
285,000 PA Higher Education Housing, 4.700%,
7/1/2009 277,858
1,200,000 University of Southern California
Revenute, 5.870%, 01/01/14 1,235,220
--------------
1,513,078
--------------
Revenue Bond - Public Facilities (0.10%)
100,000 Prairie Du Chien RDV, 7.625%,
4/1/2006 100,000
--------------
Total Municipal Bonds 2,532,944
--------------
CORPORATE BONDS (30.51%)
Automotive Finance (0.97%)
605,000 Ford Motor Credit Co, 7.375%,
2/1/2011 556,578
365,000 Daimler Chrysler NA, 6.500%,
11/15/2013 371,230
--------------
927,808
--------------
Banking & Financial (1.12%)
1,000,000 Bank of America Corp, 7.400%,
1/15/2011 1,080,825
--------------
Beverages (0.56%)
535,000 Anheuser-Busch Co, 5.950%,
1/15/1933 535,655
--------------
Broker - Dealer (2.19%)
705,000 Morgan Stanley, 3.875%,
1/15/2009 678,321
490,000 JP Morgan Chase & Co, 3.500%,
3/15/2009 466,234
490,000 JP Morgan Chase & Co, 4.500%,
1/15/2012 463,714
470,000 Lehman Bros Holdings, 6.625%,
01/18/12... 494,459
-----------
2,102,728
-----------
Building Products (0.95%)
520,000 Masco Corp, 4.800%,
6/15/2015 473,942
475,000 Valspar Corp, 5.100%,
8/1/2015 443,163
-----------
917,105
-----------
Conglomerates (1.35%)
880,000 GE Capital Corp MTN, 6.125%,
2/22/2011 906,663
350,000 GE Capital Corp MTN, 6.750%,
3/15/1932 389,753
-----------
1,296,416
-----------
Consumer Goods & Services (0.81%)
490,000 Fortune Brands Inc. 5.375%,
1/15/2016 470,339
300,000 Alberto-Culver Co, 6.375%,
6/15/2028 304,434 -----------
774,773
-----------
Data Processing (0.41%)
420,000 First Data Corp, 4.700%,
08/01/13 394,233
-----------
Aerospace - Defense (0.75%)
630,000 Northrop Grumman, 7.750%,
3/1/2016 725,713
-----------
Electrical (0.48%)
490,000 Pacific Gas & Electric, 4.800%,
3/1/2014 463,353
-----------
See note to financial statements.
23
VINTAGE MUTUAL FUNDS, INC.
BOND FUND (CONTINUED)
SCHEDULE OF PORTFOLIO INVESTMENTS
MARCH 31, 2006
Par Value Description Value
- --------- ----------- -----
Par Value Description Value
- --------- ----------- -----
CORPORATE BONDS (CONT.)
Electric Utility (1.11%)
630,000 Duke Energy Corp, 3.750%,
3/5/2008 $ 612,113
490,000 Appalachian Power CO, 5.000%,
6/1/2017 452,327
--------------
1,064,440
--------------
Financial Services (3.87%)
800,000 Goldman Sachs Group, 4.125%,
1/15/08 784,274
250,000 General Motors Acceptance Corp.,
5.125%, 05/09/08 235,280
705,000 Countrywide Home Loan, 3.250%,
5/21/2008 674,630
705,000 CIT Group Inc, 4.750%,
12/15/2010 682,455
500,000 Household Finance, 4.750%,
7/15/2013 470,439
900,000 Citigroup Inc, 5.125%,
5/5/2014 874,087
--------------
3,721,165
--------------
Food Products (0.87%)
810,000 Kroger Co, 7.450%,
3/1/2008 837,086
--------------
Home Building & Services (0.70%)
715,000 DR Horton Inc, 5.625%,
9/15/2014 672,058
--------------
Indust Goods & Services (0.44%)
410,000 Tyco Intl Group, 6.375%,
10/15/2011 420,899
--------------
Insurance (0.46%)
440,000 Genworth Financial, 5.750%,
6/15/2014 442,503
--------------
Medical Hospital Management (0.49%)
490,000 Wellpoint Inc., 5.250%,
1/15/2016 472,528
--------------
Media (1.59%)
355,000 AOL Time Warner, 6.875%,
5/1/2012 372,209
910,000 Comcast (AT&T Broadband), 8.375%,
3/15/2013 1,023,430
120,000 AOL Time Warner, 7.625%,
4/15/1931 130,721
-----------
1,526,360
-----------
Mining (0.49%)
490,000 BHP Finance USA, 5.250%,
12/15/2015 475,285
-----------
Networking Products (0.50%)
490,000 Cisco Systems, Inc., 5.500%,
2/22/2016 482,640
-----------
Oil & Gas (1.64%)
615,000 Marathon Oil Corp, 5.375%,
6/1/2007 615,319
450,000 Enterprise Products, 5.000%,
3/1/2015 417,515
480,000 Conoco Inc, 6.950%,
4/15/2029 543,020
-----------
1,575,854
-----------
Pipelines (0.69%)
630,000 Kinder Morgan Energy, 6.750%,
3/15/2011 658,678
-----------
Printing & Publish (0.88%)
920,000 R.R. Donnelley & Sons, 4.950%,
4/1/2014 844,041
-----------
Railroads (0.53%)
480,000 Union Pacific Corp, 6.625%
2/1/2029 513,045
-----------
Real Estate Investment Trust (0.71%)
630,000 Simon Property Group REIT 7.750%,
01/20/11+F30 683,673
-----------
See note to financial statements.
24
VINTAGE MUTUAL FUNDS, INC.
BOND FUND (CONTINUED)
SCHEDULE OF PORTFOLIO INVESTMENTS
MARCH 31, 2006
Par Value Description Value
CORPORATE BONDS (CONT.)
Retail General Merchandise (0.98%)
150,000 May Deptartment Stores, 3.950%,
7/15/2007 $ 146,866
660,000 Wal-Mart Stores, 7.550%,
2/15/1930 791,303
--------------
938,169
--------------
Telecommunications (4.98%)
900,000 Telus Corp., 7.500%,
6/1/2007 920,337
630,000 America Movil SA, 4.125%,
3/1/2009 605,599
945,000 GTE Corp (Verizon), 7.510%,
4/1/2009 993,375
425,000 France Telecom, 7.750%,
3/1/2011 464,147
910,000 AT&T Wireless, 7.875%,
3/1/2011 997,419
710,000 Sprint Corp, 8.375%,
3/15/2012 802,229
--------------
4,783,106
--------------
Total Corporate Bonds 29,330,139
--------------
PREFERRED STOCK (0.27%)
Real Estate Investment Trust
10,000 Realty Income Sr PFD, 8.250%,
11/15/2008 264,000
--------------
MUTUAL FUND (0.92%)
882,886 Vintage Government Assets Fund
T Shares, 3.845%* 882,886
--------------
Total Investments in Securities
(99.65%) (Cost $97,881,702) $ 95,781,658
Other Assets & Liabilities (0.35%) 340,990
--------------
NET ASSETS (100.00%) $ 96,122,648
==============
*Rate shown is as of March 31, 2006
See note to financial statements.
25
PERFORMANCE REPORT
THE VINTAGE MUNICIPAL BOND FUND
Interest rates jumped higher as economic activity advanced and the Federal
Reserve continued to raise interest rates. The ten-year U.S. Treasury rate rose
0.46 percent on continued strength in the labor market and finished the quarter
at 4.85 percent. Municipal bonds followed suit with the ten year rising 0.22
percent to finish at 4.00 percent. Performance benefited from the addition of
callable bonds and some healthcare and non-essential revenue bond exposure.
Concentrations in ten year maturities hindered performance as rates rose.
The Fund made significant strides toward increasing income and improving
relative performance over the last quarter. Increasing callable bond exposure as
well as the addition of some higher yielding exposures such as healthcare pushed
overall portfolio yield higher and resulted in improving performance relative to
peers. The Fund ended February in the 96th percentile of Morningstar funds but
finished March in the 55th percentile for the month. Investment strategy
continues to increase exposure to municipal sectors and structures that generate
an income advantage over the index while maintaining interest rate risk modestly
lower than the index.
Performance Report Municipal Bond Fund
Graph Omitted - Information presented
Value of $10,000 Investment
Average Annual Returns
as of 3/31/2006
1 Year 5 Year 10 Year Value
------ ------ ------- -----
Vintage Municipal Bond Fund 1.30% 3.24% 4.04% $14,950
Lehman Brothers 1-12 Yr Gov't/Credit Index 2.64% 4.58% 5.35% $16,678
Lehman Brothers 2-17 Yr Gov't/Credit Index 3.11% 5.00% N/A $16,701
PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE; PAST PERFORMANCE IS NOT
PREDICATIVE OF FUTURE RESULTS. THE VALUE OF SHARES IN THE VINTAGE MUTUAL FUNDS
WILL FLUCTUATE SO THAT THE SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN
THEIR ORIGINAL COST. THE COMPOSITION OF THE FUND'S HOLDINGS IS SUBJECT TO
CHANGE. PERFORMANCE DATA CURRENT TO THE MOST RECENT MONTH END MAY BE OBTAINED BY
ACCESSING THE WEBSITE AT WWW.VINTAGEFUNDS.COM.
Bond funds will tend to experience smaller fluctuations in value than stock
funds. However, investors in any bond fund should anticipate fluctuations in
price, especially for longer-term issues and in an environment of rising
interest rates.
The performance of the Vintage Municipal Bond Fund is measured against the
Merrill Lynch 2-17 Year Municipal Bond Index, an unmanaged index generally
representative of the performance of municipal bonds with maturities of 2-17
years. During this period, the benchmark changed from the Merrill Lynch 1-12
Year Index to the Merrill Lynch 2-17 Year Index because the longer maturity
profile is expected to result in higher income. The index does not reflect the
deduction of fees associated with a mutual fund, such as investment management
fees. The Fund's performance reflects the deduction of fees for these
value-added services. The performance table and graph do not reflect the
deduction of taxes that a shareholder would pay on fund distributions or the
redemption of fund shares.
27
VINTAGE MUTUAL FUNDS, INC.
MUNICIPAL BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
MARCH 31,2006
Par Value Description Value
- --------- ----------- -----
MUNICIPAL BONDS (91.19%)
Alabama (3.39%)
585,000 AL Public Schools and Colleges,
4.000%, 02/01/08 $ 588,960
290,000 Montgomery, AL G.O.,
5.000%, 01/01/23 302,487
--------------
891,447
--------------
Arkansas (1.87%)
465,000 Arkansas State G.O.,
5.500%, 08/01/09 491,849
--------------
Arizona (1.21%)
300,000 Arizona Development Authority
Revenue, 5.000%, 08/01/18 318,642
--------------
California (5.24%)
500,000 California State,
5.250%, 03/01/11 531,530
500,000 California State,
5.250%, 07/01/13 541,585
290,000 California State,
5.000%, 12/01/17 304,268
--------------
1,377,383
--------------
Colorado (3.64%)
150,000 Denver, CO Parks Department,
4.000%, 09/01/07 149,655
465,000 Arapahoe, County CO,
6.000%, 12/15/09 500,354
290,000 Evergreen, CO G.O.,
5.000%, 12/01/19 305,901
--------------
955,910
--------------
Florida (3.94%)
475,000 FL State Board of Education,
5.000%, 06/01/15 508,602
200,000 Bay County, FL,
5.000%, 09/01/18 212,332
300,000 Collier County, FL,
5.000%, 06/01/21 315,522
--------------
1,036,456
--------------
Illinois (8.47%)
435,000 Will County, IL School District,
6.500%, 11/01/10 485,704
750,000 Illinois State,
5.375%, 10/01/13 816,758
240,000 DuPage County, IL,
5.000%, 11/01/16 253,276
320,000 Will County, IL SD,
6.500%, 11/01/17 355,775
300,000 De Kalb County, IL G.O.,
5.000%, 12/01/20 315,723
-------------
2,227,236
-------------
Indiana (1.88%)
450,000 Allen County, IN,
5.750%, 04/01/11 494,424
-------------
Kansas (2.03%)
500,000 Johnson County, KS,
5.000%, 10/01/15 533,500
-------------
Massachusetts (1.88%)
465,000 MA State Special Revenue,
5.000%, 06/01/14 493,872
-------------
Maryland (2.45%)
485,000 Frederick County, MD,
5.250%, 11/01/21 542,788
100,000 MD Economic Development,
3.180%, 07/01/34 100,000
-------------
642,788
-------------
Michigan (4.04%)
1,000,000 Wayne State University, MI,
5.375%, 11/15/13 1,061,340
-------------
Mississippi (1.83%)
465,000 Mississippi State - Series B,
5.800%, 11/15/07 479,815
-------------
See notes to financial statements.
28
VINTAGE MUTUAL FUNDS, INC.
MUNICIPAL BOND FUND (CONTINUED)
SCHEDULE OF PORTFOLIO INVESTMENTS
MARCH 31,2006
Par Value Description Value
- --------- ----------- -----
MUNICIPAL BONDS (CONT.)
New Jersey (2.17%)
30,000 NJ Wastewater,
4.800%, 09/01/06 $ 30,164
500,000 New Jersey State,
5.250%, 06/15/14 540,490
--------------
570,654
--------------
Nevada (1.16%)
290,000 Nevada State G.O.,
5.000%, 02/01/18 305,863
--------------
New York (4.13%)
440,000 New York ,NY,
5.000%, 08/01/12 464,050
245,000 New York, NY - Series G,
5.000%, 12/01/17 257,466
250,000 New York, NY Transitional
Authority, 5.000%, 11/01/19 264,193
100,000 New York, NY Transitional
Authority 3.040%, 11/01/22 100,000
--------------
1,085,709
--------------
Ohio (3.25%)
490,000 Ohio State Water Development
Board, 5.250%, 06/01/16 533,458
300,000 Ohio State University,
5.250% , 06/01/19 321,027
--------------
854,485
--------------
Pennsylvania (3.84%)
290,000 Neshaminy, PA G.O.,
5.000%, 05/01/18 308,656
500,000 Philadelphia, PA IDR,
3.120%, 03/01/27 500,000
200,000 Chester Co., PA Dev,
3.120%, 07/01/31 200,000
--------------
1,008,656
--------------
Tennessee (6.16%)
1,000,000 Johnson City, TN,
5.500%, 07/01/12 $ 1,085,610
500,000 Memphis, TN,
5.000%, 11/01/14 533,275
-------------
1,618,885
-------------
Texas (16.99%)
500,000 San Antonio, TX,
6.000%, 08/01/08 525,530
750,000 Texas State,
5.250%, 08/01/10 795,128
900,000 Sam Rayburn, TX,
6.000%, 09/01/10 970,272
1,000,000 San Antonio, TX,
5.000%, 02/01/12 1,056,580
490,000 Texas State,
5.250%, 10/15/12 525,887
280,000 Denton, TX Utilities Systems,
5.000%, 12/01/13 293,457
290,000 Plano, TX G.O,
4.750%, 09/01/19 299,727
-------------
4,466,580
-------------
Washington (7.61%)
340,000 Clark County, WA School,
5.250%, 12/01/09 358,136
465,000 Grays Harbor County, WA Utilities,
5.50%, 01/01/14 496,736
500,000 King County, WA,
5.000%, 01/01/11 526,710
465,000 WA State Series R03A,
5.000%, 01/01/15 487,673
125,000 Clark County, WA School Districts,
5.250%, 12/01/14 130,720
-------------
1,999,975
-------------
See notes to financial statements.
29
VINTAGE MUTUAL FUNDS, INC.
MUNICIPAL BOND FUND (CONTINUED)
SCHEDULE OF PORTFOLIO INVESTMENTS
MARCH 31,2006
Par Value Description Value
- --------- ----------- -----
MUNICIPAL BONDS (CONT.)
Wisconsin (4.01%)
520,000 Milwaukee, WI - Series K,
5.000%, 06/15/10 $ 535,054
500,000 Wisconsin State,
5.000%, 05/01/11 519,250
--------------
1,054,304
--------------
Total Municipal Bonds 23,969,773
--------------
ALTERNATIVE MINIMUM TAX PAPER (8.26%)
Iowa (3.89%)
1,000,000 Iowa Student Loan Corp.,
5.100%, 06/01/09 1,023,540
Massachusetts (0.48%)
125,000 MA Education Revenue,
5.600%, 07/01/06 125,321
Utah (3.89%)
1,000,000 Utah State,
5.200%, 05/01/08 1,022,660
--------------
Total Alternative Minimum Tax Paper 2,171,521
--------------
MUTUAL FUNDS (0.53%)
139,000 Vintage Municipal Assets Fund
I Shares, 2.178%* 139,000
--------------
Total Investments in Securities
(99.98%) (Cost $26,203,058) $ 26,280,294
Other Assets & Liabilities (0.02%) 6,326
--------------
NET ASSETS (100.00%) $ 26,286,620
==============
*Rate shown is as of March 31, 2006
See notes to financial statements.
30
VINTAGE MUTUAL FUNDS, INC.
STATEMENTS OF ASSETS AND LIABILITIES
MARCH 31, 2006
GOVERNMENT INSTITUTIONAL INSTITUTIONAL LIQUID MUNICIPAL LIMITED MUNICIPAL
ASSETS MONEY MARKET RESERVES ASSETS ASSETS TERM BOND BOND BOND
FUND FUND FUND FUND FUND FUND FUND FUND
------------ ------------- ------------ ------------- ------------ ------------ ------------ -----------
ASSETS:
Investments, at value $23,958,934 $ ----- $24,166,520 $ 95,012,067 $18,227,370 $44,609,102 $95,781,658 $26,280,294
Repurchase agreements 35,824,737 63,487,753 22,030,456 39,465,121 ----- ----- ----- -----
------------ ------------- ------------ ------------- ------------ ------------ ------------ -----------
Total Investments 59,783,671 63,487,753 46,196,976 134,477,188 18,227,370 44,609,102 95,781,658 26,280,294
Interest and dividends
receivable 127,675 8,492 130,855 929,732 116,981 403,569 734,609 359,928
Receivable for capital
shares issued 11,048 ----- ----- 1,995 ----- 13,245 61,180 -----
Dividend reinvestment
receivable 46,192 204,712 ----- 12,502 1,190 36,047 86,276 6,548
Prepaid expenses 10,698 2,364 8,430 14,269 4,914 7,449 15,171 5,019
------------ ------------- ------------ ------------- ------------ ------------ ------------ -----------
Total Assets 59,979,284 63,703,321 46,336,261 135,435,686 18,350,455 45,069,412 96,678,894 26,651,789
------------ ------------- ------------ ------------- ------------ ------------ ------------ -----------
LIABILITIES:
Dividends payable 175,010 204,712 166,865 407,015 33,377 134,179 343,854 72,408
Payable to brokers
for investments purchased ----- ----- ----- 2,567,584 ----- ----- ----- 271,400
Payable for capital
shares redeemed ----- ----- ----- 17,362 ----- 20,562 120,601 -----
Accrued expenses and
other payables:
Investment advisory fees 16,589 2,346 5,863 39,802 5,725 20,010 47,703 11,867
Administration fees 9,954 3,285 1,954 23,881 3,435 5,603 18,214 6,171
Accounting fees 1,422 ----- ----- 3,412 491 1,201 2,602 712
Distribution fees ----- ----- ----- 34,829 861 ----- ----- -----
Servicing fees ----- ----- ----- 55,876 2,609 ----- ----- -----
Other 29,136 6,619 6,613 38,097 ----- 14,040 23,272 2,611
------------ ------------- ------------ ------------- ------------ ------------ ------------ -----------
Total Liabilities 232,111 216,962 181,295 3,187,858 46,498 195,595 556,246 365,169
------------ ------------- ------------ ------------- ------------ ------------ ------------ -----------
Net Assets $59,747,173 $ 63,486,359 $46,154,966 $ 132,247,828 $18,303,957 $44,873,817 $96,122,648 $26,286,620
============ ============= ============ ============= ============ ============ ============ ===========
Investments, at cost $59,783,671 $ 63,487,753 $46,196,976 $ 134,477,188 $18,227,370 $45,294,382 $97,881,702 $26,203,058
============ ============= ============ ============= ============ ============ ============ ===========
See notes to finanical statements.
31
VINTAGE MUTUAL FUNDS, INC.
STATEMENTS OF ASSETS AND LIABILITIES
MARCH 31, 2006
Limited Municipal
Term Bond Bond Bond
Fund Fund Fund
------------- ------------- --------------
ASSETS:
Investments, at value $ 44,609,102 $ 95,781,658 $ 26,280,294
Repurchase agreements ----- ----- -----
------------- ------------- -------------
Total Investments 44,609,102 95,781,658 26,280,294
Interest and dividends receivable 403,569 734,609 359,928
Receivable for capital shares issued 13,245 61,180 -----
Dividend reinvestment receivable 36,047 86,276 6,548
Prepaid expenses 7,449 15,171 5,019
------------- ------------- -------------
Total Assets 45,069,412 96,678,894 26,651,789
------------- ------------- -------------
LIABILITIES:
Dividends payable 134,179 343,854 72,408
Payable to brokers for investments purchased ----- ----- 271,400
Payable for capital shares redeemed 20,562 120,601 -----
Accrued expenses and other payables:
Investment advisory fees 20,010 47,703 11,867
Administration fees 5,603 18,214 6,171
Accounting fees 1,201 2,602 712
Distribution fees ----- ----- -----
Servicing fees ----- ----- -----
Other 14,040 23,272 2,611
------------- ------------- -------------
Total Liabilities 195,595 556,246 365,169
------------- ------------- -------------
Net Assets $ 44,873,817 $ 96,122,648 $ 26,286,620
============= ============= =============
Investments, at cost $ 45,294,382 $ 97,881,702 $ 26,203,058
============= ============= =============
See notes to finanical statements.
32
VINTAGE MUTUAL FUNDS, INC.
STATEMENTS OF ASSETS AND LIABILITIES
MARCH 31, 2006
Government Institutional Institutional Liquid Municipal
Assets Money Market Reserves Assets Assets
Fund Fund Fund Fund Fund
--------------- --------------- ---------------- --------------- ---------------
NET ASSETS:
Paid-in capital $ 59,731,727 $ 63,486,359 $ 46,154,966 $ 132,259,104 $ 18,303,957
Accumulated undistributed
(distributions in excess of)
net investment income 15,446 ----- ----- (109) -----
Net unrealized appreciation
(depreciation) on investments ----- ----- ----- ----- -----
Accumulated undistributed net
realized gains (losses)
on investment transactions ----- ----- ----- (11,167) -----
--------------- --------------- ---------------- --------------- ---------------
Net Assets $ 59,747,173 $ 63,486,359 $ 46,154,966 $ 132,247,828 $ 18,303,957
=============== =============== ================ =============== ===============
Authorized shares 1,250,000,000 1,250,000,000
=============== ================
Shares outstanding, $.001 par value 63,486,359 46,154,966
=============== ================
Net asset value--offering and
redemption price per share $1.00 $1.00
=============== ================
PRICING OF S SHARES
Net assets applicable to
S Shares outstanding $ 11,581,272 $ 2,102,055
=============== ===============
Authorized shares 1,250,000,000 1,250,000,000
=============== ===============
Shares outstanding, $.001 par value 11,587,350 2,102,055
=============== ===============
Net asset value--offering and
redemption price per share $1.00 $1.00
=============== ===============
PRICING OF S2 SHARES
Net assets applicable to
S2 Shares outstanding $ 60,513,482
===============
Authorized shares 1,250,000,000
===============
Shares outstanding, $.001 par value 60,513,808
===============
Net asset value--offering and
redemption price per share $1.00
===============
PRICING OF T SHARES
Net assets applicable to
T Shares outstanding $ 59,747,173 $ 27,536,719 $ 3,275,742
=============== =============== ===============
Authorized shares 1,250,000,000 1,250,000,000 1,250,000,000
=============== =============== ===============
Shares outstanding, $.001 par value 59,759,807 27,539,117 3,275,742
=============== =============== ===============
Net asset value--offering and
redemption price per share $1.00 $1.00 $1.00
=============== =============== ===============
PRICING OF I SHARES
Net assets applicable to
I Shares outstanding $ 32,616,355 $ 12,926,160
=============== ===============
Authorized shares 1,250,000,000 1,250,000,000
=============== ===============
Shares outstanding, $.001 par value 32,618,722 12,926,160
=============== ===============
Net asset value--offering and
redemption price per share $1.00 $1.00
=============== ===============
See notes to finanical statements.
33
VINTAGE MUTUAL FUNDS, INC.
STATEMENTS OF ASSETS AND LIABILITIES
MARCH 31, 2006
Limited Municipal
Term Bond Bond Bond
Fund Fund Fund
------------- ------------- --------------
NET ASSETS:
Paid-in capital $ 48,623,801 $ 100,753,213 $ 26,101,569
Accumulated undistributed (distributions in excess of)
net investment income 140,248 10,740 (673)
Net unrealized appreciation (depreciation) on investments (685,280) (2,100,044) 77,236
Accumulated undistributed net realized gains (losses)
on investment transactions (3,204,952) (2,541,261) 108,488
------------- ------------- --------------
Net Assets $ 44,873,817 $ 96,122,648 $ 26,286,620
============= ============= ==============
Authorized shares 800,000,000 809,987,393 800,000,000
============= ============= ==============
Shares outstanding, $.001 par value 4,767,945 10,054,087 2,597,765
============= ============= ==============
Net asset value--offering and redemption
price per share $9.41 $9.56 $10.12
============= ============= ==============
See notes to finanical statements.
34
VINTAGE MUTUAL FUNDS, INC.
STATEMENTS OF OPERATIONS
For the Year Ended March 31, 2006
Government Institutional Institutional Liquid Municipal
Assets Money Market Reserves Assets Assets
Fund Fund Fund Fund Fund
- --------------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME:
Interest income $ 2,562,721 $ 1,130,062 $ 2,145,465 $ 4,519,556 $ 594,744
Dividend income ----- ----- ----- ----- -----
-------------- -------------- ------------- ------------- -----------
Total Income 2,562,721 1,130,062 2,145,465 4,519,556 594,744
-------------- -------------- ------------- ------------- -----------
EXPENSES:
Investment advisory fees 285,846 95,269 201,576 401,394 77,510
Administration fees 150,069 57,162 120,946 240,837 46,506
Distribution and shareholder service fees ----- ----- ----- ----- -----
Distribution and shareholder service fees S Shares ----- ----- ----- 113,095 14,216
Distribution and shareholder service fees S2 Shares ----- ----- ----- 260,660 -----
Distribution and shareholder service fees T Shares 178,654 ----- ----- 71,711 8,944
Custody fees 41,060 23,289 29,922 87,537 9,541
Accounting fees 21,438 8,166 17,278 34,405 6,644
Legal fees 3,346 1,142 2,058 5,035 808
Audit fees 15,185 5,003 8,439 19,156 5,704
Directors' fees 15,216 4,646 8,908 18,926 3,489
Transfer agent fees 73,894 ----- 6,416 99,815 21,787
Registration and filing fees 5,203 324 ----- 9,224 2,688
Printing fees 6,552 912 3,315 8,326 1,678
Insurance expense 15,425 3,486 9,843 19,143 1,801
Other 5,568 2,028 3,501 8,081 3,531
-------------- -------------- ------------- ------------- -----------
Total Expenses 817,456 201,427 412,202 1,397,345 204,847
Less: Expenses voluntarily reduced/waived (214,385) (145,115) (239,423) (95,896) (9,018)
-------------- -------------- ------------- ------------- -----------
Net Expenses 603,071 56,312 172,779 1,301,449 195,829
-------------- -------------- ------------- ------------- -----------
Net Investment Income 1,959,650 1,073,750 1,972,686 3,218,107 398,915
-------------- -------------- ------------- ------------- -----------
REALIZED/UNREALIZED GAINS (LOSSES) FROM
INVESTMENTS:
Net realized gains (losses) from investment
transactions ----- ----- ----- ----- -----
Net change in unrealized appreciation
(depreciation) from investments ----- ----- ----- ----- -----
-------------- -------------- ------------- ------------- -----------
Net realized and unrealized losses from
investments ----- ----- ----- ----- -----
-------------- -------------- ------------- ------------- -----------
Change in net assets resulting from operations $ 1,959,650 $ 1,073,750 $ 1,972,686 $ 3,218,107 $ 398,915
============== ============== ============= ============= ===========
See notes to finanical statements.
35
VINTAGE MUTUAL FUNDS, INC.
STATEMENTS OF OPERATIONS
For the Year Ended March 31, 2006
Limited Municipal
Term Bond Bond Bond
Fund Fund Fund
- --------------------------------------------------------------------------------------------------------
INVESTMENT INCOME:
Interest income $ 2,047,591 $ 5,156,431 $ 1,371,698
Dividend income ----- 20,625 -----
-------------- --------------- ---------------
Total Income 2,047,591 5,177,056 1,371,698
-------------- --------------- ---------------
EXPENSES:
Investment advisory fees 259,850 590,903 170,119
Administration fees 135,122 279,336 88,462
Distribution and shareholder service fees 129,925 268,592 85,059
Distribution and shareholder service fees S Shares ----- ----- -----
Distribution and shareholder service fees S2 Shares ----- ----- -----
Distribution and shareholder service fees T Shares ----- ----- -----
Custody fees 9,266 16,048 5,124
Accounting fees 15,591 32,231 10,207
Legal fees 2,165 4,394 1,144
Audit fees 9,328 17,358 6,392
Directors' fees 9,103 18,150 4,849
Transfer agent fees 50,840 70,247 15,890
Registration and filing fees 3,656 4,644 1,313
Printing fees 3,863 7,556 2,015
Insurance expense 9,430 18,792 5,056
Other 17,708 33,711 9,497
-------------- --------------- ---------------
Total Expenses 655,847 1,361,962 405,127
Less: Expenses voluntarily reduced/waived (192,289) (322,311) (85,059)
-------------- --------------- ---------------
Net Expenses 463,558 1,039,651 320,068
-------------- --------------- ---------------
Net Investment Income 1,584,033 4,137,405 1,051,630
-------------- --------------- ---------------
REALIZED/UNREALIZED GAINS (LOSSES) FROM
INVESTMENTS:
Net realized gains (losses) from investment
transactions (808,802) (276,031) 345,195
Net change in unrealized appreciation (depreciation) from
investments 424,621 (1,933,025) (867,305)
-------------- --------------- ---------------
Net realized and unrealized losses from
investments (384,181) (2,209,056) (522,110)
-------------- --------------- ---------------
Change in net assets resulting from operations $ 1,199,852 $ 1,928,349 $ 529,520
============== =============== ===============
See notes to finanical statements.
36
VINTAGE MUTUAL FUNDS, INC.
STATEMENTS OF CHANGES IN NET ASSETS
GOVERNMENT ASSETS INSTITUTIONAL MONEY MARKET INSTITUTIONAL RESERVES
FUND FUND FUND
--------------------------- -------------------------- ------------------------
YEAR YEAR YEAR FROM MARCH 7, YEAR YEAR
ENDED ENDED ENDED 2005 THROUGH ENDED ENDED
MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31,
2006 2005 2006 2005 2006 2005
------------- ------------ ------------ ------------ ----------- -----------
OPERATIONS:
Net investment income $ 1,959,650 $ 983,856 $ 1,073,750 $ 10,990 $ 1,972,686 $ 793,517
Net realized gains (losses)
from investment transactions ------ ------ ------ ------ ------ ------
Net change in unrealized appreciation
(depreciation) from investments ------ ------ ------ ------ ------ ------
Change in net assets resulting from
operations ----------- ----------- ------------ ---------- ------------ ----------
1,959,650 983,856 1,073,750 10,990 1,972,686 793,517
----------- ----------- ------------ ---------- ------------ ----------
DISTRIBUTIONS TO
SHAREHOLDERS:
From net investment income:
Capital Shares ------ ------ (1,073,750) (10,990) (1,972,686) (793,517)
S Shares ------ ------ ------ ------ ------ ------
S2 Shares ------ ------ ------ ------ ------ ------
T Shares (1,959,650) (983,856) ------ ------ ------ ------
I Shares ------ ------ ------ ------ ------ ------
From net realized gains:
Capital Shares ------ ------ ------ ------ ------ ------
S Shares ------ ------ ------ ------ ------ ------
T Shares ------ ------ ------ ------ ------ ------
Return of capital ------ ------ ------ ------ ------ ------
Change in net assets from
shareholder distributions ----------- ----------- ------------ ---------- ------------ ----------
$(1,959,650) $ (983,856) $(1,073,750) $ (10,990) $(1,972,686) $(793,517)
----------- ----------- ------------ ---------- ------------ ----------
LIQUID ASSETS MUNICIPAL ASSETS
FUND FUND
--------------------------- -------------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
MARCH 31, MARCH 31, MARCH 31, MARCH 31,
2006 2005 2006 2005
--------------- ------------ ------------ ------------
OPERATIONS:
Net investment income $3,218,107 $ 736,741 $ 398,915 $ 148,834
Net realized gains (losses)
from investment transactions ------ ------ ------ ------
Net change in unrealized appreciation
(depreciation) from investments ------ ------ ------ ------
Change in net assets resulting from
operations ---------- ---------- ---------- -----------
3,218,107 736,741 398,915 148,834
---------- ---------- ---------- -----------
DISTRIBUTIONS TO
SHAREHOLDERS:
From net investment income:
Capital Shares ------ ------ ------ ------
S Shares (355,197) (104,572) (44,087) (15,480)
S2 Shares (1,375,224) (293,767) ------ ------
T Shares (872,120) (189,661) (61,414) (20,825)
I Shares (615,566) (148,741) (293,414) (112,529)
From net realized gains:
Capital Shares ------ ------ ------ ------
S Shares ------ ------ ------ ------
T Shares ------ ------ ------ ------
Return of capital ------ ------ ------ ------
Change in net assets from
shareholder distributions ---------- ---------- ---------- -----------
(3,218,107) $(736,741) $ (398,915) $(148,834)
---------- ---------- ---------- -----------
See notes to finanical statements.
37
VINTAGE MUTUAL FUNDS, INC.
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
LIMITED TERM BOND BOND FUND MUNICIPAL BOND
FUND FUND FUND
---------------------------- --------------------------- -----------------------
YEAR YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31,
2006 2005 2006 2005 2006 2005
------------- ------------ ------------ ------------- ----------- ----------
OPERATIONS:
Net investment income $ 1,584,033 $ 1,720,611 $ 4,137,405 $ 4,642,928 $ 1,051,630 $ 1,293,115
Net realized gains (losses)
from investment transactions (808,802) (159,338) (276,031) 914,128 345,195 433,703
Net change in unrealized appreciation
(depreciation) from investments 424,621 (1,744,562) (1,933,025) (4,012,600) (867,305) (1,913,060)
Change in net assets resulting from
operations ---------- ------------ ----------- ------------ ---------- ----------
1,199,852 (183,289) 1,928,349 1,544,456 529,520 (186,242)
---------- ------------ ----------- ------------ ---------- ----------
DISTRIBUTIONS TO
SHAREHOLDERS:
From net investment income:
Capital Shares (1,486,952) (1,580,322) (4,412,560) (4,642,928) (1,052,079) (1,293,115)
S Shares ------ ------ ------ ------ ------ ------
S2 Shares ------ ------ ------ ------ ------ ------
T Shares ------ ------ ------ ------ ------ ------
I Shares ------ ------ ------ ------ ------ ------
From net realized gains:
Capital Shares ------ ------ ------ ------ (551,669) (578,806)
S Shares ------ ------ ------ ------ ------ ------
T Shares ------ ------ ------ ------ ------ ------
Return of capital ------ (140,289) ------ ------ ------ ------
Change in net assets from
shareholder distributions ------------ ------------ ----------- ------------ ---------- ----------
$(1,486,952) $(1,720,611) $(4,412,560) $(4,642,928) $(1,603,748) $(1,871,921)
------------ ------------ ----------- ------------ ---------- ----------
See notes to finanical statements.
40
VINTAGE MUTUAL FUNDS, INC.
STATEMENTS OF CHANGES IN NET ASSETS
GOVERNMENT ASSETS INSTITUTIONAL MONEY MARKET INSTITUTIONAL RESERVES
FUND FUND FUND
--------------------------- -------------------------- ------------------------
YEAR YEAR YEAR FROM MARCH 7, YEAR YEAR
ENDED ENDED ENDED 2005 THROUGH ENDED ENDED
MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31,
2006 2005 2006 2005 2006 2005
------------- ------------ ------------ ------------ ----------- -----------
CAPITAL SHARE TRANSACTIONS:
ISSUED:
Capital Shares ------ ------ 172,452,017 10,726,480 197,521,583 341,975,590
S Shares ------ ------ ------ ------ ------ ------
S2 Shares ------ ------ ------ ------ ------ ------
T Shares 232,156,672 352,501,493 ------ ------ ------ ------
I Shares ------ ------ ------ ------ ------ ------
REINVESTMENTS:
Capital Shares ------ ------ 1,084,739 ------ ------ ------
S Shares ------ ------ ------ ------ ------ ------
S2 Shares ------ ------ ------ ------ ------ ------
T Shares 469,097 150,153 ------ ------ ------ ------
I Shares ------ ------ ------ ------ ------ ------
REDEMPTIONS:
Capital Shares ------ ------ (120,162,877) (614,000)(195,039,629)(331,336,325)
S Shares ------ ------ ------ ------ ------ ------
S2 Shares ------ ------ ------ ------ ------ ------
T Shares (269,629,640) (353,711,468) ------ ------ ------ ------
I Shares ------ ------ ------ ------ ------ ------
------------- ------------ ------------ ------------ ---------- ----------
Change in net assets
from capital transactions (37,003,871) (1,059,822) 53,373,879 10,112,480 2,481,954 10,639,265
------------- ------------ ------------ ------------ ---------- ----------
Change in net assets (37,003,871) (1,059,822) 53,373,879 10,112,480 2,481,954 10,639,265
NET ASSETS:
Beginning of period 96,751,044 97,810,866 10,112,480 ------ 43,673,012 33,033,747
------------- ------------ ------------ ----------- ----------- ----------
End of period $59,747,173 $96,751,044 $63,486,359 $10,112,480 $46,154,966 $43,673,012
============= ============ ============ =========== =========== ==========
LIQUID ASSETS MUNICIPAL ASSETS
FUND FUND
--------------------------- -------------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
MARCH 31, MARCH 31, MARCH 31, MARCH 31,
2006 2005 2006 2005
--------------- ------------ ------------ ------------
CAPITAL SHARE TRANSACTIONS:
ISSUED:
Capital Shares ------ ------ ------ ------
S Shares 69,214,128 100,822,881 9,603,471 6,131,575
S2 Shares 295,821,875 249,211,827 ------ ------
T Shares 275,516,554 178,247,680 8,039,451 9,937,198
I Shares 59,546,020 35,128,546 43,700,653 66,058,434
REINVESTMENTS:
Capital Shares ------ ------ ------ ------
S Shares ------ ------ ------ ------
S2 Shares ------ ------ ------ ------
T Shares 137,553 58,424 11,852 3,115
I Shares 13,003 21,250 ------ ------
REDEMPTIONS:
Capital Shares ------ ------ ------ ------
S Shares (71,003,387) (124,589,161) (10,443,172) (5,972,939)
S2 Shares (283,549,395) (229,721,091) ------ ------
T Shares (261,578,141) (183,649,324) (8,736,851) (9,645,393)
I Shares (37,299,624) (47,527,041) (50,593,904) (73,710,334)
------------- ----------- ------------ ------------
Change in net assets
from capital transactions 46,818,586 (21,996,009) (8,418,500) (7,198,344)
------------- ----------- ------------ ------------
Change in net assets 46,818,586 (21,996,009) (8,418,500) (7,198,344)
NET ASSETS:
Beginning of period 85,429,242 107,425,251 26,722,457 33,920,801
------------- ------------ ------------ ------------
End of period $132,247,828 $85,429,242 $18,303,957 $ 26,722,457
============= ============ ============ ============
See notes to finanical statements.
38
VINTAGE MUTUAL FUNDS, INC.
STATEMENTS OF CHANGES IN NET ASSETS
GOVERNMENT ASSETS INSTITUTIONAL MONEY MARKET INSTITUTIONAL RESERVES
FUND FUND FUND
--------------------------- -------------------------- ------------------------
YEAR YEAR YEAR FROM MARCH 7, YEAR YEAR
ENDED ENDED ENDED 2005 THROUGH ENDED ENDED
MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31,
2006 2005 2006 2005 2006 2005
------------- ------------ ------------ ------------ ----------- -----------
SHARE TRANSACTIONS:
ISSUED:
Capital Shares ------ ------ 172,452,017 10,726,480 197,521,583 341,975,590
S Shares ------ ------ ------ ------ ------ ------
S2 Shares ------ ------ ------ ------ ------ ------
T Shares 232,156,672 352,501,493 ------ ------ ------ ------
I Shares ------ ------ ------ ------ ------ ------
REINVESTMENTS:
Capital Shares ------ ------ 1,084,739 ------ ------ ------
S Shares ------ ------ ------ ------ ------ ------
S2 Shares ------ ------ ------ ------ ------ ------
T Shares 469,097 150,153 ------ ------ ------ ------
I Shares ------ ------ ------ ------ ------ ------
REDEMPTIONS:
Capital Shares ------ ------ (120,162,877) (614,000)(195,039,629)(331,336,325)
S Shares ------ ------ ------ ------ ------ ------
S2 Shares ------ ------ ------ ------ ------ ------
T Shares (269,629,640) (353,711,468) ------ ------ ------ ------
I Shares ------ ------ ------ ------ ------ ------
------------ ------------ ------------- ------------ ----------- ------------
Change in shares (37,003,871) (1,059,822) 53,373,879 10,112,480 2,481,954 10,639,265
============ ============ ============= ============ =========== ============
LIQUID ASSETS MUNICIPAL ASSETS
FUND FUND
--------------------------- -------------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
MARCH 31, MARCH 31, MARCH 31, MARCH 31,
2006 2005 2006 2005
--------------- ------------ ------------ ------------
SHARE TRANSACTIONS:
ISSUED:
Capital Shares ------ ------ ------ ------
S Shares 69,214,128 100,822,881 9,603,471 6,131,575
S2 Shares 295,821,875 249,211,827 ------ ------
T Shares 275,516,554 178,247,680 8,039,451 9,937,198
I Shares 59,546,020 35,128,546 43,700,653 66,058,434
REINVESTMENTS:
Capital Shares ------ ------ ------ ------
S Shares ------ ------ ------ ------
S2 Shares ------ ------ ------ -----
T Shares 137,553 58,424 11,852 3,115
I Shares 13,003 21,250 ------ ------
REDEMPTIONS:
Capital Shares ------ ------ ------ ------
S Shares (71,003,387) (124,589,161) (10,443,172) (5,972,939)
S2 Shares (283,549,395) (229,721,091) ------ ------
T Shares (261,578,141) (183,649,324) (8,736,851) (9,645,393)
I Shares (37,299,624) (47,527,041) (50,593,904 (73,710,334)
------------- ------------- ---------- -----------
Change in shares 46,818,586 (21,996,009) (8,418,500) (7,198,344)
============= ============= ========== ===========
See notes to finanical statements.
39
VINTAGE MUTUAL FUNDS, INC.
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
LIMITED TERM BOND BOND FUND MUNICIPAL BOND
FUND FUND FUND
---------------------------- --------------------------- -----------------------
YEAR YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31,
2006 2005 2006 2005 2006 2005
------------- ------------ ------------ ------------- ----------- ----------
CAPITAL SHARE TRANSACTION
ISSUED:
Capital Shares 6,670,575 11,800,804 12,291,124 14,709,193 1,724,285 2,833,158
S Shares ------ ------ ------ ------ ------ ------
S2 Shares ------ ------ ------ ------ ------ ------
T Shares ------ ------ ------ ------ ------ ------
I Shares ------ ------ ------ ------ ------ ------
REINVESTMENTS:
Capital Shares 456,636 530,629 1,210,236 1,165,191 137,414 126,649
S Shares ------ ------ ------ ------ ------ ------
S2 Shares ------ ------ ------ ------ ------ ------
T Shares ------ ------ ------ ------ ------ ------
I Shares ------ ------ ------ ------ ------ ------
REDEMPTIONS:
Capital Shares (19,216,854) (19,058,028) (27,566,466) (25,600,415) (13,069,959) (5,852,325)
S Shares ------ ------ ------ ------ ------ ------
S2 Shares ------ ------ ------ ------ ------ ------
T Shares ------ ------ ------ ------ ------ ------
I Shares ------ ------ ------ ------ ------ ------
------------- ------------ ------------ ------------- ----------- ----------
Change in net assets
from capital transactions (12,089,643) (6,726,595) (14,065,106) (9,726,031) (11,208,260) (2,892,518)
------------- ------------ ------------ ------------- ----------- ----------
Change in net assets (12,376,743) (8,630,495) (16,549,317) (12,824,503) (12,282,488) (4,950,681)
NET ASSETS:
Beginning of period 57,250,560 65,881,055 112,671,965 125,496,468 38,569,108 43,519,789
------------- ------------ ------------ ------------- ----------- ----------
End of period 44,873,817 $ 57,250,560 $ 96,122,648 $ 112,671,965 $26,286,620 $38,569,108
============= ============ ============ ============= =========== ==========
See notes to finanical statements.
41
VINTAGE MUTUAL FUNDS, INC.
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
LIMITED TERM BOND BOND FUND MUNICIPAL BOND
FUND FUND FUND
---------------------------- --------------------------- -----------------------
YEAR YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31,
2006 2005 2006 2005 2006 2005
------------- ------------ ------------ ------------- ----------- ----------
SHARE TRANSACTIONS:
Issued:
Capital Shares 703,873 1,230,705 1,255,250 1,482,568 166,389 262,207
S Shares ------ ------ ------ ------ ------ ------
S2 Shares ------ ------ ------ ------ ------ ------
T Shares ------ ------ ------ ------ ------ ------
I Shares ------ ------ ------ ------ ------ ------
Reinvestments:
Capital Shares 48,273 52,202 123,586 118,463 13,273 11,755
S Shares ------ ------ ------ ------ ------ ------
S2 Shares ------ ------ ------ ------ ------ ------
T Shares ------ ------ ------ ------ ------ ------
I Shares ------ ------ ------ ------ ------ ------
Redemptions:
Capital Shares (2,030,038) (1,983,773) (2,816,589) (2,591,749) (1,260,290) (543,364)
S Shares ------ ------ ------ ------ ------ ------
S2 Shares ------ ------ ------ ------ ------ ------
T Shares ------ ------ ------ ------ ------ ------
I Shares ------ ------ ------ ------ ------ ------
Change in shares -------------- ------------ ----------- ------------ ----------- -----------
(1,277,892) (700,866) (1,437,753) (990,718) (1,080,628) (269,402)
============== ============ =========== ============ =========== ===========
See notes to finanical statements.
42
VINTAGE MUTUAL FUNDS, INC.
Notes to Financial Statements
March 31, 2006
1. ORGANIZATION:
IMG Mutual Funds, Inc. was incorporated on November 16, 1994 and capitalized on
May 1, 1995. IMG Mutual Funds, Inc. was renamed Vintage Mutual Funds, Inc., (the
"Funds"), in February 1998. The Funds are registered under the Investment
Company Act of 1940 (the "1940 Act"), as amended, as a diversified open-end
management investment company issuing its shares in eight portfolios. The Funds
currently consist of the following diversified portfolios (individually, a
"Fund"): Government Assets Fund, Institutional Money Market Fund, Institutional
Reserves Fund, Liquid Assets Fund, Municipal Assets Fund, Vintage Limited Term
Bond Fund ("Limited Term Bond Fund"), Vintage Bond Fund ("Bond Fund"), Vintage
Municipal Bond Fund ("Municipal Bond Fund").
Liquid Assets Fund and Municipal Assets Fund offer four and three classes of
shares, respectively. S and S2 Shares are offered to customers of banks. S and
S2 Shares are normally offered through financial institutions providing
automatic "sweep" investment programs to their own customers. T Shares may be
purchased only by financial institutions acting on their own behalf or on behalf
of certain customers' accounts. I Shares may be purchased by individual and
institutional investors directly from BISYS Fund Services Limited Partnership
(the "Distributor").
Each class of shares has equal rights to earnings, assets, and voting privileges
except each class bears different distribution and shareholder servicing
expenses. Each class of shares has exclusive voting rights on matters affecting
only that class. Income, expenses (other than expenses attributable to a
specific class), and realized and unrealized gains or losses on investments are
allocated to each class of shares based upon its relative net assets.
2. SIGNIFICANT ACCOUNTING POLICIES:
The following is a summary of significant accounting policies followed by the
Funds in the preparation of the financial statements. The policies are in
conformity with accounting principles generally accepted in the United States of
America ("GAAP"). The preparation of financial statements 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 increase and decrease in
net assets from operations during the period. Actual results could differ from
those estimates.
SECURITIES VALUATION
Investments of the Government Assets Fund, Institutional Money Market Fund,
Institutional Reserves Fund, Liquid Assets Fund and Municipal Assets Fund (the
"Money Market Funds") are valued at amortized cost, which approximates market
value. Under the amortized cost method of valuation, discount or premium is
amortized on an effective yield basis to the maturity of the security.
43
Investments of the Limited Term Bond Fund, Bond Fund, and Municipal Bond Fund
(collectively the "Variable Net Asset Funds") for which the primary market is a
national securities exchange are valued at the last reported sale price or
official closing price, on the day of valuation. In the absence of any sale of
such securities on the valuation date, the valuations are based on the latest
available bid quotation.
Substantially all fixed-income securities are valued each business day as of the
close of regular trading by one or more independent pricing services (the
"Pricing Services") approved by the Fund's Board of Directors (the "Board").
When quoted bid prices are readily available, the Pricing Services generally
value fixed-income securities at the bid price, provided that the Pricing
Services believe those prices to reflect the fair market value of the
securities. Other investments valued by the Pricing Services are carried at fair
value as determined by the Pricing Services, based on methods which include
consideration of: yields or prices of securities of comparable quality, coupon,
maturity and type; indications as to values from dealers; and general market
conditions. Pricing Services may take other factors into consideration in
pricing securities, including institutional size transactions in similar groups
of securities as well as developments related to specific securities.
Investments in investment companies are valued at their respective net asset
values as reported by such companies. Securities, including restricted
securities, for which market quotations are not readily available, are valued at
fair market value as determined in good faith by the investment adviser under
the supervision of the Board. The difference between the cost and market values
of investments held by the variable net asset funds is reflected as either
unrealized appreciation or depreciation.
SECURITY TRANSACTIONS AND INVESTMENT INCOME
Security transactions are accounted for on the date the security is purchased or
sold ("trade date"). Interest income is recognized on the accrual basis and
includes, when applicable, the pro rata amortization of premium or accretion of
discount. Dividends are recorded on the ex-dividend date. Gains or losses
realized on sales of securities are determined on the identified cost basis.
REPURCHASE AGREEMENTS
The Funds may engage in repurchase agreements with financial institutions such
as banks, brokers, or dealers that the investment advisor, Investors Management
Group, ("IMG"), deems creditworthy under guidelines approved by the Board,
subject to the seller's agreement to repurchase such securities at a mutually
agreed-upon date and price. The seller under a repurchase agreement will be
required to maintain continually the value of collateral held pursuant to the
agreement at not less than the repurchase price (including accrued interest). If
the seller were to default on its repurchase obligation or become insolvent, the
Fund holding such obligation would suffer a loss to the extent that the proceeds
from a sale of the underlying portfolio were less than the repurchase price
under the agreement, or to the extent that the disposition of such securities by
the Fund were delayed pending court action. The repurchase price generally
equals the price paid plus interest negotiated on the basis of current
short-term rates, which may be more or less than the rate on the underlying
portfolio securities.
44
VINTAGE MUTUAL FUNDS, INC.
Notes to Financial Statements (Continued)
March 31, 2005
LOAN CERTIFICATES
The Liquid Assets Fund invests in Farmer's Home Administration Guaranteed Loan
Certificates ("FmHA") which represent interests in the guaranteed portion of
FmHA loans issued by one or more guaranteed loan trusts subject to repurchase on
no more than five business days' written notice. The FmHAs are diversified
through limitations on certificates sold by any one individual bank.
SECURITIES PURCHASED ON A WHEN-ISSUED OR DELAYED-DELIVERY BASIS
Each Fund may purchase securities on a when-issued or delayed-delivery basis.
When-issued securities are securities purchased with delivery to occur at a
later date at a stated price and/or yield, thereby involving the risk that the
price and/or yield obtained may be more or less than those available in the
market when delivery takes place. At the time a Fund makes a commitment to
purchase a security on a when-issued basis, the Fund records the transaction and
reflects the value of the security in determining net asset value. A segregated
account is established and the Fund maintains cash and marketable securities at
least equal in value to commitments for when-issued securities.
DIVIDENDS TO SHAREHOLDERS
Dividends from net investment income are declared daily and paid monthly for the
Government Assets Fund, Institutional Money Market Fund, Institutional Reserves
Fund, Liquid Assets Fund and Municipal Assets Fund. Dividends from net
investment income are declared and paid monthly for the Limited Term Bond Fund,
Bond Fund, and Municipal Bond Fund. Distributable net realized capital gains, if
any, are declared and distributed at least annually for each of the Funds.
The dividends from net investment income and distributions from net realized
gains are determined in accordance with federal income tax regulations, which
may differ from GAAP. These "book/tax" differences are either considered
temporary or permanent in nature. To the extent these differences are permanent
in nature, such amounts are reclassified within the composition of net assets
based on their federal treatment; temporary differences do not require
reclassification.
BANK LINE OF CREDIT
The Funds have a $5,000,000 bank line of credit agreement with the Bank of New
York. The Funds utilize short-term borrowings when redemptions exceed
expectations or a trade settlement is delayed. Aside from such short-term
borrowings, the Funds did not borrow from the line during the year ended March
31, 2006.
EXPENSES
Expenses attributable to a Fund are charged to that Fund; other expenses of the
Funds are prorated to the Funds on the basis of each Fund's relative net assets
or on another reasonable basis.
TAXES
Each Fund's policy is to comply with the requirements of the Internal Revenue
Code applicable to regulated investment companies and to distribute taxable
income to shareholders in amounts that will avoid or minimize federal income or
excise taxes of the Fund.
45
3. PURCHASES AND SALES OF SECURITIES:
Purchases and sales of securities (excluding short-term securities) for the year
ended March 31, 2006 are as follows:
PROCEEDS
PURCHASES FROM SALES
--------- ----------
Limited Term Bond Fund $33,250,452 $44,068,312
Bond Fund $30,508,343 $43,332,739
Municipal Bond Fund $10,828,880 $20,905,250
4. RELATED PARTY TRANSACTIONS:
Under the terms of its Investment Advisory Agreement, IMG is entitled to receive
fees computed daily on a percentage of the average daily net assets of each fund
as follows:
Government Assets Fund 0.40%
Institutional Money Market Fund 0.35%
Institutional Reserves Fund 0.35%
Liquid Assets Fund 0.35%
Municipal Assets Fund 0.35%
Limited Term Bond Fund 0.50%
Bond Fund 0.55%
Municipal Bond Fund 0.50%
IMG voluntarily limited advisory fees for the Government Assets Fund to 0.35
percent, Institutional Money Market Fund to a range from 0.00 to 0.08 percent,
and Institutional Reserves Fund to a range from 0.10 to 0.15 percent.
The Funds have entered into a management and administration agreement with IMG
pursuant to which the Funds pay administrative fees at an annual rate of 0.21
percent of the average daily net assets for the Money Market Funds and 0.26
percent of the average daily net assets for the Variable Net Asset Funds. IMG
voluntarily limited administrative fees for the Institutional Money Market Fund
to a range from 0.00 to 0.07 percent, Institutional Reserves Fund to 0.05
percent, Limited Term Bond Fund to 0.14 percent, and Bond Fund to 0.21 percent.
IMG also provides fund accounting services for the Funds pursuant to a Fund
Accounting Agreement and receives a fee of 0.03 percent of the average daily net
assets of each Fund for such services. IMG voluntarily waived all fund
accounting fees for the Institutional Money Market Fund and Institutional
Reserves Fund, during the fiscal year ended March 31, 2006.
46
The Funds have adopted an Administrative Services Plan (the "Services Plan")
pursuant to which each Fund is authorized to pay compensation to banks and other
financial institutions (each a "Participating Organization"), which may include
AMCORE Financial, Inc. ("AMCORE", which owned IMG until December 30, 2005), its
correspondent and affiliated banks, which agree to provide recordkeeping and/or
administrative support services for their customers or account holders
(collectively, "customers") who are beneficial or record owner of shares of that
Fund. In consideration for such services, a Participating Organization receives
a fee from a Fund, computed daily and paid monthly, at an annual rate of up to
0.25 percent of the average daily net asset value of shares of that Fund owned
beneficially or of record by such Participating Organization's customers for
whom the Participating Organization provides such services. At March 31, 2006,
the Funds are required to pay servicing fees as follows: 0.25 percent on S
shares of the Liquid Assets Fund and Municipal Assets Fund, 0.25 percent on S2
shares of the Liquid Assets Fund, and 0.25 percent on T shares of the Liquid
Assets Fund and Municipal Assets Fund, which has been reduced to 0.15 percent
due to IMG supplementing 0.10 percent. During a portion of the year IMG limited
administrative service fees on S shares of the Municipal Assets Fund to 0.07
percent and supplemented the portion of fees waived at the Fund level to the
Participating Organization. IMG has the ability to supplement Administrative
Service fees up to 0.25 percent on the Government Assets Fund, Limited Term Bond
Fund, Bond Fund, and Municipal Bond Fund. During the year ended March 31, 2006,
AMCORE recorded revenue of $18,703 and $4,962 for administrative service fees
from the Liquid Assets Fund and Municipal Assets Fund, respectively.
BISYS Fund Services Limited Partnership serves as distributor to the Funds
pursuant to a Distribution Agreement. The Distributor receives no compensation
under the Distribution Agreement with the Funds, but may receive compensation
under a Distribution and Shareholder Service Plan (the "Plan") adopted pursuant
to Rule 12b-1 under the 1940 Act under which the Funds are authorized to pay the
Distributor for payments it makes to Participating Organizations. As authorized
by the Plan, the Distributor will enter into Shareholder Agreements with
Participating Organizations, including AMCORE, or its affiliates, pursuant to
which the Participating Organization agrees to provide certain administrative
and shareholder support services in connection with Shares of a Fund purchased
and held by Customers of the Participating Organization. The Distributor will be
compensated by a Fund up to the amount of any payments it makes to Participating
Organizations under the Rule 12b-1 Agreement. The maximum fee is 0.50 percent on
S Shares of the Liquid Assets Fund, 0.25 percent on S2 Shares of the Liquid
Assets Fund, and 0.25 percent on T Shares of the Liquid Assets and Municipal
Assets Funds, Limited Term Bond Fund, Bond Fund, and Municipal Bond Fund. As of
March 31, 2006, such fees were limited to 0.40 percent for S Shares of the
Liquid Assets Fund, 0.15 percent for S2 Shares of the Liquid Assets Fund, 0.15
percent for S Shares of the Municipal Assets Fund and no fees for all other
classes and Funds including T and I Shares of the Liquid Assets Fund and
Municipal Assets Fund, the Government Assets Fund, Limited Term Bond Fund, Bond
Fund, and Municipal Bond Fund. However, IMG as Adviser and Administrator of the
Fund may in its sole discretion make payments to the Distributor to supplement
shareholder fees paid by the Fund up to the maximum fee approved by the Plan
without further notice to shareholders and at no cost to the Fund. During the
year ended March 31, 2006, IMG limited distribution fees on S shares of Liquid
Assets Fund and Municipal Assets Fund, and S2 shares of Liquid Assets Fund and
supplemented the portion of fees waived at the Fund level to the Participating
Organization. During the year ended March 31, 2006, AMCORE received $1,935 and
$354 for distribution fees from the Liquid Assets Fund and Municipal Assets
Fund, respectively.
47
IMG also serves as the Fund's transfer agent to certain classes of the
Institutional Money Market Fund, Institutional Reserves Fund, S, S2, and I Share
classes of Liquid Assets Fund and S and I Share classes of Municipal Assets
Fund. IMG is paid a fee for Transfer Agency Services based on the number of
shareholder accounts serviced or a minimum fee amount. During the fiscal year
ended March 31, 2006, IMG received $36,000 in transfer agent service fees. BISYS
Fund Services Limited Partnership serves as transfer agent to the other classes
and Funds pursuant to a Transfer Agency Agreement with the Funds and receives a
fee for such services.
5. FEDERAL INCOME TAXES:
Each Fund's policy is to comply with the requirements of the Internal Revenue
Code applicable to regulated investment companies and to distribute taxable
income to shareholders in amounts that will avoid or minimize federal income or
excise taxes of the Fund.
The amounts of aggregate unrealized gain (loss) and the cost of investment
securities as of March 31, 2006 for tax purposes follow:
Aggregate Aggregate Net
Unrealized Unrealized Unrealized Cost of
Gain (Loss) Gain (Loss) Investments
---- ------ ----------- -----------
Government Assets Fund - - - $59,783,671
Institutional Money Market - - - $63,487,753
Fund
Institutional Reserves Fund - - - $46,196,976
Liquid Assets Fund - - - $134,477,188
Municipal Assets Fund - - - $18,227,370
Limited Term Bond Fund $19,288 ($708,100) ($688,812) $45,297,915
Bond Fund $508,776 ($2,624,039) ($2,115,263) $97,896,921
Municipal Bond Fund $357,689 ($280,453) $77,236 $26,203,058
Distributable earnings as of March 31, 2006 for tax purposes follow:
Distributable Earnings
Long-term
Ordinary Gains
Income (Losses) Tax Exempt
------ -------- ----------
Government Assets Fund $190,456 $ - $ -
Institutional Money Market Fund $204,712 $ - $ -
Institutional Reserves Fund $166,865 $ - $ -
Liquid Assets Fund $407,015 $ - $ -
Municipal Assets Fund $ - $ - $33,377
Limited Term Bond Fund $249,853 $ - $ -
Bond Fund $354,539 $ - $ -
Municipal Bond Fund $ - $ 108,488 $71,735
48
Distributions for the year ended March 31, 2006 for tax purposes follow:
Ordinary Long-term Return of
Income Capital Gains Tax Exempt Capital
------ ------------- ---------- -------
Government Assets Fund $ 1,942,819 $ - $ - $ -
Institutional Money Market Fund $ 880,028 $ - $ - $ -
Institutional Reserves Fund $ 1,896,964 $ - $ - $ -
Liquid Assets Fund $ 2,924,491 $ - $ - $ -
Municipal Assets Fund $ - $ - $ 389,744 $ -
Limited Term Bond Fund $ 1,488,584 $ - $ - $ -
Bond Fund $ 4,441,663 $ - $ - $ -
Municipal Bond Fund $ - $ 551,669 $ 1,081,120 $ -
Capital loss carryovers are available to offset future realized capital gains
for Federal income tax purposes. The following shows the totals by year in which
capital loss carryovers will expire if not used:
Liquid Assets Limited Term
Fund Bond Fund Bond Fund
---- --------- ---------
March 31, 2007 $ - $ 434 $ -
March 31, 2008 $ - $ 32,964 $ -
March 31, 2009 $ - $ 496,477 $ 415,441
March 31, 2010 $ - $ - $ -
March 31, 2011 $ 4,519 $ 17,563 $ -
March 31, 2012 $ 6,648 $1,659,350 $1,793,103
March 31, 2013 $ - $ 88,259 $ -
March 31, 2014 - $ 624,709 $ 8,157
------------- ------------ ------------
Total Carryover $ 11,167 $2,919,756 $2,216,701
============= ============ ============
At March 31, 2006, the Limited Term Bond Fund and Bond Fund had $281,666 and
$309,321 respectively, in deferred capital losses occurring subsequent to
October 31, 2005. For tax purposes, such losses will be reflected in the year
ended March 31, 2007.
49
6. OTHER TAX INFORMATION (UNAUDITED):
The Municipal Bond Fund designated $551,669 of capital gain dividends for the
fiscal year ended March 31, 2006. The Municipal Assets Fund and Municipal Bond
Fund designated $389,744 and $1,081,120, respectively, of tax-exempt dividends
for the fiscal year ended March 31, 2006.
7. SUBSEQUENT EVENTS
The Vintage Board of Directors approved the termination and liquidation of the
Government Assets Fund effective June 29, 2006. All shareholders in Government
Assets Fund on that date will automatically have the proceeds of the liquidation
invested in the Liquid Assets Fund, and they will become shareholders of Liquid
Assets Fund with the exact same account balance as they had in Government Assets
Fund. This action was taken to improve the operating efficiency of the Funds.
50
(THIS PAGE INTENTIONALLY LEFT BLANK)
51
VINTAGE MUTUAL FUNDS, INC.
FINANCIAL HIGHLIGHTS
INVESTMENT ACTIVITIES DIVIDENDS AND DISTRIBUTIONS
-------------------------------- ---------------------------------------------
Net Net Realized/ Total Total
NAV Investment Unrealized from From Net From Net Dividends NAV
Beginning Income Gains Investment Investment Realized Return of and End
of Period (Loss) (Losses) Activities Income Gains Capital Distributions of Period
--------- ---------- ----------- ---------- ------ ----- ------- ------------- ---------
Government Assets Fund "T" Shares
Year Ended March 31, 2006 $1.00 0.03 0.00 0.03 (0.03) 0.00 0.00 (0.03) $1.00
Year Ended March 31, 2005 $1.00 0.01 0.00 0.01 (0.01) 0.00 0.00 (0.01) $1.00
Year Ended March 31, 2004 $1.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 $1.00
Year Ended March 31, 2003 $1.00 0.01 0.00 0.01 (0.01) 0.00 0.00 (0.01) $1.00
Year Ended March 31, 2002 $1.00 0.03 0.00 0.03 (0.03) 0.00 0.00 (0.03) $1.00
INSTITUTIONAL MONEY MARKET FUND
Year Ended March 31, 2006 $1.00 0.04 0.00 0.04 (0.04) 0.00 0.00 (0.04) $1.00
From March 7, 2005
through March 31, 2005 $1.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 $1.00
INSTITUTIONAL RESERVES FUND
Year Ended March 31, 2006 $1.00 0.03 0.00 0.03 (0.03) 0.00 0.00 (0.03) $1.00
Year Ended March 31, 2005 $1.00 0.02 0.00 0.02 (0.02) 0.00 0.00 (0.02) $1.00
Year Ended March 31, 2004 $1.00 0.01 0.00 0.01 (0.01) 0.00 0.00 (0.01) $1.00
LIQUID ASSETS FUND "S" SHARES
Year Ended March 31, 2006 $1.00 0.02 0.00 0.02 (0.02) 0.00 0.00 (0.02) $1.00
Year Ended March 31, 2005 $1.00 0.01 0.00 0.01 (0.01) 0.00 0.00 (0.01) $1.00
Year Ended March 31, 2004 $1.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 $1.00
Year Ended March 31, 2003 $1.00 0.01 0.00 0.01 (0.01) 0.00 0.00 (0.01) $1.00
Year Ended March 31, 2002 $1.00 0.02 0.00 0.02 (0.02) 0.00 0.00 (0.02) $1.00
LIQUID ASSETS FUND "S2" SHARES
Year Ended March 31, 2006 $1.00 0.03 0.00 0.03 (0.03) 0.00 0.00 (0.03) $1.00
Year Ended March 31, 2005 $1.00 0.01 0.00 0.01 (0.01) 0.00 0.00 (0.01) $1.00
Year Ended March 31, 2004 $1.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 $1.00
Year Ended March 31, 2003 $1.00 0.01 0.00 0.01 (0.01) 0.00 0.00 (0.01) $1.00
Year Ended March 31, 2002 $1.00 0.02 0.00 0.02 (0.02) 0.00 0.00 (0.02) $1.00
LIQUID ASSETS FUND "T" SHARES
Year Ended March 31, 2006 $1.00 0.03 0.00 0.03 (0.03) 0.00 0.00 (0.03) $1.00
Year Ended March 31, 2005 $1.00 0.01 0.00 0.01 (0.01) 0.00 0.00 (0.01) $1.00
Year Ended March 31, 2004 $1.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 $1.00
Year Ended March 31, 2003 $1.00 0.01 0.00 0.01 (0.01) 0.00 0.00 (0.01) $1.00
Year Ended March 31, 2002 $1.00 0.03 0.00 0.03 (0.03) 0.00 0.00 (0.03) $1.00
LIQUID ASSETS FUND "I" SHARES
Year Ended March 31, 2006 $1.00 0.03 0.00 0.03 (0.03) 0.00 0.00 (0.03) $1.00
Year Ended March 31, 2005 $1.00 0.01 0.00 0.01 (0.01) 0.00 0.00 (0.01) $1.00
Year Ended March 31, 2004 $1.00 0.01 0.00 0.01 (0.01) 0.00 0.00 (0.01) $1.00
Year Ended March 31, 2003 $1.00 0.01 0.00 0.01 (0.01) 0.00 0.00 (0.01) $1.00
Year Ended March 31, 2002 $1.00 0.03 0.00 0.03 (0.03) 0.00 0.00 (0.03) $1.00
MUNICIPAL ASSETS FUND "S" SHARES
Year Ended March 31, 2006 $1.00 0.02 0.00 0.02 (0.02) 0.00 0.00 (0.02) $1.00
Year Ended March 31, 2005 $1.00 0.01 0.00 0.01 (0.01) 0.00 0.00 (0.01) $1.00
Year Ended March 31, 2004 $1.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 $1.00
Year Ended March 31, 2003 $1.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 $1.00
Year Ended March 31, 2002 $1.00 0.01 0.00 0.01 (0.01) 0.00 0.00 (0.01) $1.00
MUNICIPAL ASSETS FUND "T" SHARES
Year Ended March 31, 2006 $1.00 0.02 0.00 0.02 (0.02) 0.00 0.00 (0.02) $1.00
Year Ended March 31, 2005 $1.00 0.01 0.00 0.01 (0.01) 0.00 0.00 (0.01) $1.00
Year Ended March 31, 2004 $1.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 $1.00
Year Ended March 31, 2003 $1.00 0.01 0.00 0.01 (0.01) 0.00 0.00 (0.01) $1.00
Year Ended March 31, 2002 $1.00 0.02 0.00 0.02 (0.02) 0.00 0.00 (0.02) $1.00
MUNICIPAL ASSETS FUND "I" SHARES
Year Ended March 31, 2006 $1.00 0.02 0.00 0.02 (0.02) 0.00 0.00 (0.02) $1.00
Year Ended March 31, 2005 $1.00 0.01 0.00 0.01 (0.01) 0.00 0.00 (0.01) $1.00
Year Ended March 31, 2004 $1.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 $1.00
Year Ended March 31, 2003 $1.00 0.01 0.00 0.01 (0.01) 0.00 0.00 (0.01) $1.00
Year Ended March 31, 2002 $1.00 0.02 0.00 0.02 (0.02) 0.00 0.00 (0.02) $1.00
* During the period certain fees were voluntarily reduced. If such
voluntary fee reductions had not occurred, the ratios would have been as
indicated.
** Total return is for the period and has not been annualized.
*** Ratios are annualized.
See notes to financial statements.
52
VINTAGE MUTUAL FUNDS, INC.
FINANCIAL HIGHLIGHTS
TOTAL RETURN / RATIOS / SUPPLEMENTARY DATA
---------------------------------------------------------------------------
Ratio of Net Ratio of Net
Ratio of Investment Ratio of Investment
Net Assets Expenses to Income (Loss) Expenses to Income (Loss)
Total End of Period Average to Average Average to Average
Return (000 omitted) Net Assets Net Assets* Net Assets* Net Assets*
------ ------------------------ ----------- ----------- -----------
Government Assets Fund "T" Shares
Year Ended March 31, 2006 2.88% $59,747 0.84% 2.74% 1.14% 2.44%
Year Ended March 31, 2005 0.95% $96,751 0.78% 0.93% 1.08% 0.63%
Year Ended March 31, 2004 0.40% $97,811 0.75% 0.41% 0.81% 0.36%
Year Ended March 31, 2003 0.96% $168,574 0.72% 0.95% 0.77% 0.90%
Year Ended March 31, 2002 2.66% $134,316 0.68% 2.69% 0.73% 2.64%
INSTITUTIONAL MONEY MARKET FUND
Year Ended March 31, 2006 3.64% $63,486 0.21% 3.94% 0.74% 3.41%
From March 7, 2005
through March 31, 2005 0.17% ** $10,112 0.15% *** 2.54% *** 0.74% *** 1.95% ***
INSTITUTIONAL RESERVES FUND
Year Ended March 31, 2006 3.47% $46,155 0.30% 3.43% 0.72% 3.01%
Year Ended March 31, 2005 1.59% $43,673 0.17% 1.62% 0.72% 1.07%
Year Ended March 31, 2004 1.03% $33,034 0.14% 1.00% 0.68% 0.46%
LIQUID ASSETS FUND "S" SHARES
Year Ended March 31, 2006 2.39% $11,581 1.48% 2.36% 1.58% 2.26%
Year Ended March 31, 2005 0.56% $13,371 1.32% 0.41% 1.58% 0.16%
Year Ended March 31, 2004 0.08% $37,139 1.37% 0.08% 1.55% (0.10%)
Year Ended March 31, 2003 0.56% $74,250 1.36% 0.56% ----- -----
Year Ended March 31, 2002 2.22% $79,744 1.36% 2.14% ----- -----
LIQUID ASSETS FUND "S2" SHARES
Year Ended March 31, 2006 2.65% $60,514 1.23% 2.64% 1.33% 2.54%
Year Ended March 31, 2005 0.77% $48,241 1.16% 0.88% 1.33% 0.71%
Year Ended March 31, 2004 0.29% $28,748 1.12% 0.29% 1.30% 0.10%
Year Ended March 31, 2003 0.81% $3,958 1.11% 0.86% ----- -----
Year Ended March 31, 2002 2.48% $8,519 1.11% 2.44% ----- -----
LIQUID ASSETS FUND "T" SHARES
Year Ended March 31, 2006 2.90% $27,537 0.98% 3.04% 1.08% 2.94%
Year Ended March 31, 2005 0.94% $13,461 0.98% 0.93% 1.08% 0.83%
Year Ended March 31, 2004 0.41% $18,804 0.87% 0.41% 1.05% 0.23%
Year Ended March 31, 2003 1.06% $29,287 0.86% 1.09% ----- -----
Year Ended March 31, 2002 2.73% $44,038 0.86% 2.57% ----- -----
LIQUID ASSETS FUND "I" SHARES
Year Ended March 31, 2006 3.06% $32,616 0.83% 3.28% ----- -----
Year Ended March 31, 2005 1.09% $10,357 0.83% 1.03% ----- -----
Year Ended March 31, 2004 0.56% $22,734 0.62% 0.56% 0.80% 0.38%
Year Ended March 31, 2003 1.22% $28,948 0.71% 1.21% ----- -----
Year Ended March 31, 2002 2.89% $43,041 0.71% 2.72% ----- -----
MUNICIPAL ASSETS FUND "S" SHARES
Year Ended March 31, 2006 1.58% $2,102 1.13% 1.55% 1.32% 1.36%
Year Ended March 31, 2005 0.54% $2,942 0.90% 0.55% 1.34% 0.10%
Year Ended March 31, 2004 0.23% $2,783 1.20% 0.24% 1.65% (0.21%)
Year Ended March 31, 2003 0.35% $2,993 1.10% 0.33% 1.17% 0.26%
Year Ended March 31, 2002 1.47% $2,151 1.11% 1.40% ----- -----
MUNICIPAL ASSETS FUND "T" SHARES
Year Ended March 31, 2006 1.75% $3,276 0.97% 1.72% 1.07% 1.62%
Year Ended March 31, 2005 0.58% $3,961 0.85% 0.59% 1.09% 0.35%
Year Ended March 31, 2004 0.26% $3,666 0.95% 0.26% 1.16% 0.05%
Year Ended March 31, 2003 0.55% $5,493 0.92% 0.56% ----- -----
Year Ended March 31, 2002 1.70% $6,053 0.86% 1.67% ----- -----
MUNICIPAL ASSETS FUND "I" SHARES
Year Ended March 31, 2006 1.90% $12,926 0.82% 1.87% ----- -----
Year Ended March 31, 2005 0.64% $19,819 0.79% 0.60% 0.84% 0.55%
Year Ended March 31, 2004 0.30% $27,471 0.70% 0.31% ----- -----
Year Ended March 31, 2003 0.70% $33,568 0.77% 0.68% ----- -----
Year Ended March 31, 2002 1.88% $26,516 0.71% 1.82% ----- -----
* During the period certain fees were voluntarily reduced. If such
voluntary fee reductions had not occurred, the ratios would have been as
indicated.
** Total return is for the period and has not been annualized.
*** Ratios are annualized.
See notes to finanical statements.
53
VINTAGE MUTUAL FUNDS, INC.
FINANCIAL HIGHLIGHTS
INVESTMENT ACTIVITIES DIVIDENDS AND DISTRIBUTIONS
-------------------------------- ---------------------------------------------
Net Net Realized/ Total Total
NAV Investment Unrealized from From Net From Net Dividends NAV
Beginning Income Gains Investment Investment Realized Return of and End
of Period (Loss) (Losses) Activities Income Gains Capital Distributions of Period
--------- ---------- ----------- ---------- ------ ----- ------- ------------- ---------
LIMITED TERM BOND FUND
Year Ended March 31, 2006 $9.47 0.30 (0.08) 0.22 (0.28) 0.00 0.00 (0.28) $9.41
Year Ended March 31, 2005 $9.76 0.26 (0.29) (0.03) (0.24) 0.00 (0.02) (0.26) $9.47
Year Ended March 31, 2004 $9.62 0.28 0.14 0.42 (0.28) 0.00 0.00 (0.28) $9.76
Year Ended March 31, 2003 $9.98 0.47 (0.36) 0.11 (0.47) 0.00 0.00 (0.47) $9.62
Year Ended March 31, 2002 $9.94 0.55 0.03 0.58 (0.54) 0.00 0.00 (0.54) $9.98
BOND FUND
Year Ended March 31, 2006 $9.80 0.40 (0.24) 0.16 (0.40) 0.00 0.00 (0.40) $9.56
Year Ended March 31, 2005 $10.05 0.40 (0.25) 0.15 (0.40) 0.00 0.00 (0.40) $9.80
Year Ended March 31, 2004 $9.78 0.41 0.28 0.69 (0.42) 0.00 0.00 (0.42) $10.05
Year Ended March 31, 2003 $9.94 0.58 (0.14) 0.44 (0.59) (0.01) 0.00 (0.60) $9.78
Year Ended March 31, 2002 $9.97 0.56 (0.03) 0.53 (0.56) 0.00 0.00 (0.56) $9.94
MUNICIPAL BOND FUND
Year Ended March 31, 2006 $10.49 0.33 (0.19) 0.14 (0.33) (0.18) 0.00 (0.51) $10.12
Year Ended March 31, 2005 $11.02 0.34 (0.38) (0.04) (0.34) (0.15) 0.00 (0.49) $10.49
Year Ended March 31, 2004 $11.06 0.37 0.07 0.44 (0.38) (0.10) 0.00 (0.48) $11.02
Year Ended March 31, 2003 $10.54 0.40 0.54 0.94 (0.40) (0.02) 0.00 (0.42) $11.06
Year Ended March 31, 2002 $10.68 0.41 (0.14) 0.27 (0.41) 0.00 0.00 (0.41) $10.54
* During the period certain fees were voluntarily reduced. If such
voluntary fee reductions had not occurred, the ratios would have been as
indicated.
** Total return is for the period and has not been annualized.
*** Ratios are annualized.
See notes to financial statements.
54
VINTAGE MUTUAL FUNDS, INC.
FINANCIAL HIGHLIGHTS
TOTAL RETURN / RATIOS / SUPPLEMENTARY DATA
---------------------------------------------------------------------------
Ratio of Net Ratio of Net
Ratio of Investment Ratio of Investment
Net Assets Expenses to Income (Loss) Expenses to Income (Loss)
Total End of Period Average to Average Average to Average Portfolio
Return (000 omitted) Net Assets Net Assets* Net Assets* Net Assets* Turnover
------ ------------------------ ----------- ----------- ----------- ----------
LIMITED TERM BOND FUND
Year Ended March 31, 2006 2.31% $44,874 0.89% 3.05% 1.26% 2.68% 64.57%
Year Ended March 31, 2005 (0.27%) $57,251 0.89% 2.72% 1.24% 2.38% 43.35%
Year Ended March 31, 2004 4.37% $65,881 0.96% 2.85% ----- ----- 73.81%
Year Ended March 31, 2003 1.13% $58,746 0.92% 4.73% ----- ----- 55.05%
Year Ended March 31, 2002 5.96% $54,153 0.93% 5.43% ----- ----- 47.31%
BOND FUND
Year Ended March 31, 2006 1.67% $96,123 0.97% 3.85% 1.27% 3.55% 28.60%
Year Ended March 31, 2005 1.47% $112,672 0.98% 3.97% 1.28% 3.67% 46.31%
Year Ended March 31, 2004 7.08% $125,496 0.99% 4.12% ----- ----- 79.75%
Year Ended March 31, 2003 4.46% $131,296 0.95% 5.78% ----- ----- 32.67%
Year Ended March 31, 2002 5.20% $143,385 0.99% 5.79% ----- ----- 41.67%
MUNICIPAL BOND FUND
Year Ended March 31, 2006 1.30% $26,287 0.94% 3.09% 1.19% 2.84% 32.16%
Year Ended March 31, 2005 (0.34%) $38,569 0.99% 3.15% 1.24% 2.90% 37.92%
Year Ended March 31, 2004 3.91% $43,520 0.93% 3.30% ----- ----- 24.51%
Year Ended March 31, 2003 9.06% $47,187 0.85% 3.60% ----- ----- 9.95%
Year Ended March 31, 2002 2.41% $46,695 0.91% 3.81% ----- ----- 27.61%
See notes to financial statements.
55
REPORT OF INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM VINTAGE MUTUAL FUNDS,INC.
To the Shareholders and Board of Directors of Vintage Mutual Funds, Inc.
We have audited the accompanying statements of assets and liabilities, including
the schedules of portfolio investments, of Vintage Bond Fund, Vintage Limited
Term Bond Fund, Vintage Municipal Bond Fund, Government Assets Fund,
Institutional Money Market Fund, Institutional Reserves Fund, Liquid Assets Fund
and Municipal Assets Fund (the "Funds") comprising Vintage Mutual Funds, Inc.,
as of March 31, 2006, and the related statements of operations for the year then
ended, and the statements of changes in net assets and financial highlights for
the periods presented. 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. The financial highlights for each of the periods presented in the
two-year period ended March 31, 2003 were audited by other auditors whose
report, dated May 16, 2003, expressed an unqualified opinion on those financial
highlights.
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. The Funds
are not required to have, nor were we engaged to perform, an audit of their
internal control over financial reporting. Our audit included consideration of
internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Funds' internal control over
financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. Our procedures included confirmation of securities owned as of
March 31, 2006, by correspondence with the custodian and brokers. 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 positions of each
of the respective Funds comprising Vintage Mutual Funds, Inc., as of March 31,
2006, the results of their operations for the year then ended, the changes in
their net assets and the financial highlights for the periods presented (except
as noted above in reference to the reports of other auditors), in conformity
with accounting principles generally accepted in the United States of America.
Deloitte & Touche LLP
Kansas City, Missouri
May 19, 2006
56
DIRECTORS AND OFFICERS Vintage Mutual Funds, Inc.
The following table contains basic information regarding directors and officers,
respectively that oversee operations of the Vintage Funds complex.
- ----------------------- ------------ ----------- -------------------- ----------- ---------------
TERM OF NUMBER OF
OFFICE PORTFOLIOS OTHER
POSITION AND OVERSEEN DIRECTORSHIPS
NAME, CONTACT, HELD WITH LENGTH OF PRINCIPAL BY HELD OUTSIDE
ADDRESS AND AGE VINTAGE TIME OCCUPATIONS DURING DIRECTOR OF VINTAGE
SERVED PAST FIVE YEARS
- ----------------------- ------------ ----------- --------------------- ----------- ---------------
INDEPENDENT DIRECTORS:
William J. Howard, Director Since 1998 Attorney, William J. 8 None
1415 28th Street, Howard Attorney at
Suite 200, West Des Law from 1998 to
Moines, IA 50266, present
Age 60
- ----------------------- ------------ ----------- ---------------------- ----------- ---------------
Debra L. Johnson Jones, Director Since 1998 President, Vodaci 8 None
1415 28th Street, Technologies from
Suite 200, West Des 2000 to present
Moines, IA 50266,
Age 45
- ----------------------- ------------ ----------- ---------------------- ----------- ---------------
Fred Lorber, Director Since 1998 Retired 8 None
1415 28th Street,
Suite 200,
West Des Moines, IA 50266,
Age 82
- ----------------------- ------------ ----------- ---------------------- ----------- ---------------
Edward J. Stanek, Director Since 1998 President and CEO, 8 None
Ph.D. Iowa Lottery from
1415 28th Street, 1985 to present;
Suite 200, West Des Chairman,
Moines, IA 50266, International Game
Age 59 Group from 2000 to
present; Senior Vice
President, World
Lottery Association
from 1999 to present
- ----------------------- ------------ ----------- ---------------------- ----------- ---------------
Steven Zumbach, Chair, Since 1998 Attorney, Belin, 8 None
1415 28th Street, Director Lamson, McCormick,
Suite 200, West Des Zumbach, and Flynn
Moines, IA 50266, from 1977 to present
Age 56
- ----------------------- ------------ ----------- ---------------------- ----------- ---------------
INTERESTED DIRECTOR:
Joseph B. McGougan, Director Since 2004 Founding officer of 8 None
1415 28th Street, AMCORE Mortgage,
Suite 200, West Des Inc. from 1987 to
Moines, IA 50266, present; President
Age 45 and Chief Executive
Officer, AMCORE
Mortgage, Inc. from
1993 to present
- ----------------------- ------------ ----------- ---------------------- ----------- ---------------
57
OFFICERS:
Jeffrey D. Lorenzen President Since 2005 President and CIO, N/A N/A
1415 28th Street, Investors Management
Suite 200, West Des Group, with
Moines, IA 50266, Age Investors Management
40 Group since 1992
- ----------------------- ------------ ----------- ---------------------- ----------- ---------------
Amy Mitchell, Secretary/ Since 1998 Vice President, N/A N/A
1415 28th Street, Treasurer Investors Management
Suite 200, West Des Group; Director of
Moines, IA 50266, Fund Administration,
Age 36 Investors Management
Group 1990 to present
- ----------------------- ------------ ----------- ---------------------- ----------- ---------------
Vera Lichtenberger Chief Since 2005 CCO, Investors N/A N/A
1415 28th Street, Compliance Management Group;
Suite 200, West Des Officer Iowa Legal Aid
Moines, IA 50266, 2002-2004; GMAC Home
Age 54 Services
1998-2001
- ----------------------- ------------ ----------- ---------------------- ----------- ---------------
The statement of Additional Information (SAI) has additional information about
the Funds' Directors and is available without charge, upon request, by calling
1-800-798-1819.
58
VINTAGE MUTUAL FUNDS, INC
ADDITIONAL INFORMATION (UNAUDITED) (CONTINUED)
MARCH 31, 2006
1. ABOUT YOUR FUND EXPENSES
It is important for you to understand the impact of costs on your investment.
All mutual funds have operating expenses. As a shareholder of the fund, you
incur ongoing costs, including management fees, distribution and service fees,
and other fund expenses. Expenses, which are deducted from a fund's investment
income, directly reduce the investment return of the fund.
A fund's expenses are expressed as a percentage of its average net assets. This
figure is known as the expense ratio. The following examples are intended to
help you understand the ongoing costs (in dollars) of investing in your fund and
compare these costs with those of other mutual funds. The examples are based on
an investment of $1,000 made at the beginning of the period and held for the
entire period from October 1, 2005 to March 31, 2006. The table on page 84
illustrates your fund's costs in two ways:
1. BASED ON ACTUAL FUND RETURN. This section helps you to estimate the actual
expenses that you paid over the period. The "Ending Account Value" shown is
derived from the fund's actual return, and the third column shows the dollar
amount that would have been paid by an investor who started with $1,000 in
the fund. You may use the information here, together with the amount you
invested, to estimate the expenses that you paid over the period.
2. BASED ON HYPOTHETICAL 5% RETURN. This section is intended to help you
compare your fund's costs with those of other mutual funds. It assumes that
the fund had a return of 5% before expenses during the period shown, but
that the expense ratio is unchanged. In this case, because the return used
is not the fund's actual return, the results do not apply to your
investment. The example is useful in making comparisons because the
Securities and Exchange Commission requires all mutual funds to calculate
expenses based on a 5% return. You can assess your fund's costs by comparing
this hypothetical example with the hypothetical examples that appear in
shareholder reports of other funds.
Your fund does not carry a "sales load" or transaction fee. The calculations
assume no shares were bought or sold during the period. Your actual costs may
have been higher or lower, depending on the amount of your investment and the
timing of any purchases or redemptions.
You can find more information about the fund's expenses, including annual
expense ratios for the past five years, in the Financial Highlights section of
this report. For additional information on operating expenses and other
shareholder costs, please refer to the appropriate fund prospectus.
59
VINTAGE MUTUAL FUNDS, INC
ADDITIONAL INFORMATION (UNAUDITED) (CONTINUED)
MARCH 31, 2006
YEAR ENDED MARCH 31, 2006
Beginning Ending Expenses Annualized
Account Value Account Value Paid During Expense
Vintage Mutual Funds 3/31/2005 3/31/2006 Period* Ratio*
- -------------------------------------------------------------------------------
BASED ON ACTUAL FUND RETURN
Money Market Funds:
Government Assets Fund $1,000.00 $1,028.80 $4.47 0.89%
Institutional Money Market Fund 1,000.00 1,032.69 1.37 0.27%
Institutional Reserves Fund 1,000.00 1,031.02 1.52 0.30%
Liquid Assets Fund S Shares 1,000.00 1,021.23 7.48 1.48%
Liquid Assets Fund S2 Shares 1,000.00 1,023.57 6.16 1.23%
Liquid Assets Fund T Shares 1,000.00 1,025.92 4.91 0.98%
Liquid Assets Fund I Shares 1,000.00 1,027.32 4.16 0.83%
Municipal Assets Fund S Shares 1,000.00 1,014.36 6.71 1.34%
Municipal Assets Fund T Shares 1,000.00 1,015.82 5.45 1.09%
Municipal Assets Fund I Shares 1,000.00 1,017.21 4.70 0.94%
Fixed Income Funds:
Limited Term Bond Fund 1,000.00 1,023.10 4.60 0.91%
Bond Fund 1,000.00 1,020.69 5.25 1.04%
Municipal Bond Fund 1,000.00 1,013.00 4.13 0.82%
- -----------------------------------------------------------------------------
BASED ON HYPOTHETICAL 5% RETURN
Money Market Funds:
Government Assets Fund $1,000.00 $1,020.55 $4.50 0.89%
Institutional Money Market Fund 1,000.00 1,023.65 1.37 0.27%
Institutional Reserves Fund 1,000.00 1,023.50 1.52 0.30%
Liquid Assets Fund S Shares 1,000.00 1,017.60 7.47 1.48%
Liquid Assets Fund S2 Shares 1,000.00 1,018.85 6.21 1.23%
Liquid Assets Fund T Shares 1,000.00 1,020.10 4.95 0.98%
Liquid Assets Fund I Shares 1,000.00 1,020.85 4.19 0.83%
Municipal Assets Fund S Shares 1,000.00 1,018.30 6.76 1.34%
Municipal Assets Fund T Shares 1,000.00 1,019.55 5.50 1.09%
Municipal Assets Fund I Shares 1,000.00 1,020.30 4.75 0.94%
Fixed Income Funds:
Limited Term Bond Fund 1,000.00 1,045.45 4.65 0.91%
Bond Fund 1,000.00 1,044.80 5.32 1.04%
Municipal Bond Fund 1,000.00 1,045.90 4.19 0.82%
- --------------------------------------------------------------------------------
*Expenses are equal to the fund's annualized expense ratio, multiplied by the
average account value over the period, multiplied by number of days in the most
recent fiscal half-year, then divided by 366.
60
VINTAGE MUTUAL FUNDS, INC
ADDITIONAL INFORMATION (UNAUDITED) (CONTINUED)
MARCH 31, 2006
2. PROXY VOTING POLICIES AND PROCEDURES, PROXY VOTING RECORD AND SCHEDULE OF
PORTFOLIO HOLDINGS, FORM N-PX
Complete schedules of portfolio holdings for the first and third quarters (Form
N-Q) are available free of charge. Form N-PX is a record of proxy votes by the
Funds. Since the Funds only hold non-voting securities, there are no votes
recorded.
Form N-PX and the Form N-Q are available upon request:
>> By calling the Funds toll free at 1-800-798-1819,
>> At www.sec.gov, or by phone at 1-800-SEC-0330, or
>> By mail at Public Reference Section, SEC, Washington, D.C. 20549
(duplicating fee required).
61
Shareholder Meeting
A special meeting of shareholders of the Vintage Mutual Funds was held December
16, 2005 at the offices of Investors Management Group, 1415 28th Street, West
Des Moines, Iowa to approve:
A new Investment Advisory Agreement with Investors Management Group, Ltd. to be
effective upon the closing of the acquisition of Investors Management Group,
Ltd. by West Bancorporation, Inc.
The matter was approved at the meeting, with the results outlined below.
- --------------------------------------------------------------------------------
Affirmative Against Abstain Total
- --------------------------------------------------------------------------------
Government Assets Fund 32,962,719 61,277 169,946 33,193,942
- --------------------------------------------------------------------------------
Liquid Assets Fund 59,544,409 158,793 2,204,294 61,907,496
- --------------------------------------------------------------------------------
Municipal Assets Fund 6,342,047 0 0 16,342,047
- --------------------------------------------------------------------------------
Institutional Reserves Fund 35,856,617 0 3,506,457 39,363,074
- --------------------------------------------------------------------------------
Institutional Money Market Fund 19,607,114 0 2,619,359 22,226,473
- --------------------------------------------------------------------------------
Limited Term Bond Fund 4,573,619 194 39,401 4,613,214
- --------------------------------------------------------------------------------
Bond Fund 8,941,383 0 101,451 9,042,834
- --------------------------------------------------------------------------------
Municipal Bond Fund 3,050,600 6,258 0 3,056,858
- --------------------------------------------------------------------------------
62
SERVICE PROVIDERS
- -------------------------------------------------------
INVESTMENT ADVISER AND ADMINISTRATOR
Investors Management Group
1415 28th Street, Suite 200
West Des Moines, Iowa 50266-1461
DISTRIBUTOR BISYS Fund
Services Limited Partnership
3435 Stelzer Road
Columbus, Ohio 43219
LEGAL COUNSEL
Cline, Williams, Wright, Johnson & Oldfather, L.L.P.
1900 U.S. Bank Building
Lincoln, Nebraska 68508
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Deloitte & Touche LLP
1100 Walnut Street, Suite 3300
Kansas City, Missouri 64106
ITEM 2. CODE OF ETHICS.
(A) THE REGISTRANT HAS ADOPTED A CODE OF ETHICS THAT APPLIES TO THE REGISTRANT'S
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 REGISTRANT OR A THIRD PARTY.
(B) NO COMMENT REQUIRED.
(C) THE CODE OF ETHICS WAS NOT AMENDED DURING THE REPORTING PERIOD. (D) THERE
WAS NO WAIVER GRANTED UNDER THE CODE OF ETHICS DURING THE REPORTING PERIOD. (E)
NOT APPLICABLE.
(F)(1) NOT APPLICABLE. (F)(2) NOT APPLICABLE.
(F)(3) TO REQUEST A FREE COPY OF THE VINTAGE MUTUAL FUNDS, INC. CODE OF ETHICS,
PLEASE CALL 1-800-438-6375.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
(a)(1) The registrant's board of directors has determined that the registrant
has at least one audit committee financial expert serving on its audit
committee. (a)(2) Debra Jones is the independent director named as the audit
committee financial expert.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a)The aggregate fees for each of the last two fiscal years for professional
services rendered by the principal accountant for the 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
are listed below. These numbers include professional services for the
preparation of the Registrant's tax returns.
March 31, 2005 $144,250
March 31, 2006 $107,565
(B)NOT APPPLICABLE.
(C)SEE ITEM 4(A)
(D)NOT APPLICABLE.
(E)NOT APPLICABLE.
(F)NOT APPLICABLE.
(G) The aggregate fees for each of the last two fiscal years for professional
services rendered by the principal accountant for the audit of the investment
adviser for internal control under 17Ad-13 (transfer agency).
March 31, 2005 $15,750
March 31, 2006 $18,200
(H) The audit committee of the registrant's Board of Directors considered the
effect of the services performed for the investment adviser and decided the
engagement did not compromise the independence of the auditor.
ITEM 5. NOT APPLICABLE.
ITEM 6. NOT APPLICABLE.
ITEM 7. NOT APPLICABLE.
ITEM 8. NOT APPLICABLE.
ITEM 9. NOT APPLICABLE.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
THERE HAVE BEEN NO CHANGES TO THE PROCEDURES BY WHICH A SHAREHOLDER MAY
RECOMMEND NOMINEES TO THE REGISTRANT'S BOARD OF DIRECTORS.
ITEM 11. CONTROLS AND PROCEDURES.
(A) THE PRINCIPAL EXECUTIVE AND FINANCIAL OFFICERS CONCLUDED THAT THE
REGISTRANT'S DISCLOSURE CONTROLS AND PROCEDURES ARE EFFECTIVE BASED ON THEIR
EVALUATION OF THE DISCLOSURE CONTROLS AND PROCEDURES AS OF MAY 30, 2006, A DATE
WITHIN 90 DAYS OF THE FILING DATE OF THIS REPORT.
(B) THERE WERE NO SIGNIFICANT CHANGES IN 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 12. EXHIBITS.
(A) A CERTIFICATION FROM THE CHIEF EXECUTIVE OFFICER AND THE CHIEF FINANCIAL
OFFICER ARE ATTACHED AS EXHIBITS.
SIGNATURES
Pursuant to the requirements of the Securities 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.
By /s/ Jeff Lorenzen
------------------------
Jeff Lorenzen, President
Date: June 1, 2006
Pursuant to the requirements of the Securities 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.
Signature and Title
/s/ Jeff Lorenzen President and Principal Executive,
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Jeff Lorenzen
June 1, 2006
/s/ Amy M. Mitchell Treasurer and Principal Financial and Accounting Officer,
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Amy M. Mitchell
June 1, 2006