UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-01829
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Columbia Acorn Trust
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(Exact name of registrant as specified in charter)
227 West Monroe, Suite 3000, Chicago, Illinois 60606
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(Address of principal executive offices) (Zip code)
Vincent Pietropaolo, Esq.
Columbia Management Group, Inc.
One Financial Center
Boston, MA 02111
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(Name and address of agent for service)
Registrant's telephone number, including area code: 1-617-772-3698
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Date of fiscal year end: December 31, 2004
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Date of reporting period: June 30, 2004
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Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO STOCKHOLDERS.
[LADY HOLDING FILE]
COLUMBIA ACORN FUNDS
SEMIANNUAL REPORT
JUNE 30, 2004
Columbia Acorn Fund
Columbia Acorn International
Columbia Acorn USA
Columbia Acorn International Select
Columbia Acorn Select
Columbia Thermostat Fund
Look inside for the date and NEW LOCATION
of the 2004 Columbia Acorn Funds
Shareholder Information Meeting.
Not FDIC May Lose Value
Insured No Bank Guarantee
PLEASE JOIN US FOR THE 2004 COLUMBIA ACORN FUNDS SHAREHOLDER INFORMATION MEETING
WHEN
September 28, 2004
9:00 a.m. CST
NEW MEETING LOCATION
BANK OF AMERICA
LASALLE ROOM, 21ST FLOOR
231 S. LASALLE STREET
CHICAGO, IL 60604
REFRESHMENTS WILL BE SERVED.
The Bank of America Building is bordered by LaSalle Street on the west, Clark
Street on the east and Jackson Boulevard on the South. The building is easily
accessible by public transportation and is near Chicago Metra stations. See the
map below for the exact location.
RSVP BY SEPTEMBER 21
PLEASE CALL US AT (800) 922-6769 BY SEPTEMBER 21 IF YOU PLAN TO ATTEND. To
comply with security requirements, we must provide Bank of America building
management with a list of guests attending the meeting. Calling to RSVP should
prevent security delays at the door on the day of the event.
TO ACCESS THE 21ST FLOOR MEETING ROOM, YOU MAY CHECK IN AT THE SECURITY DESK
LOCATED ON THE LASALLE STREET SIDE OF THE BUILDING LOBBY. YOU WILL NEED TO
PRESENT A VALID PICTURE ID (SUCH AS A DRIVER'S LICENSE) TO BUILDING SECURITY FOR
ADMITTANCE TO THE MEETING FLOOR.
We hope you will join us to meet your Columbia Acorn Funds' portfolio managers,
analysts and your fellow shareholders. Presentations will offer market updates
and provide in-depth information on your Columbia Acorn investments. A question
and answer period will follow the presentations.
[IMAGE OF LOCATION MAP]
FOR DIRECTIONS AND PARKING INFORMATION, PLEASE SEE THE INSIDE BACK COVER OF THIS
REPORT.
Columbia Acorn Family of Funds Semiannual Report 2004
TABLE OF CONTENTS
COLUMBIA ACORN FAMILY OF FUNDS
Mid-Year Distributions 2
Net Asset Value Per Share 2
Share Class Performance 3
Fund Performance vs. Benchmarks 4
Squirrel Chatter: Why The Heck Should We
Own Small-cap Stocks? 5
COLUMBIA ACORN FUND
In a Nutshell 8
At a Glance 9
Major Portfolio Changes 20
Statement of Investments 23
COLUMBIA ACORN INTERNATIONAL
In a Nutshell 10
At a Glance 11
Major Portfolio Changes 35
Statement of Investments 37
Portfolio Diversification 41
COLUMBIA ACORN USA
In a Nutshell 12
At a Glance 13
Major Portfolio Changes 42
Statement of Investments 43
COLUMBIA ACORN INTERNATIONAL SELECT
In a Nutshell 14
At a Glance 15
Major Portfolio Changes 48
Statement of Investments 49
Portfolio Diversification 51
COLUMBIA ACORN SELECT
In a Nutshell 16
At a Glance 17
Major Portfolio Changes 52
Statement of Investments 53
COLUMBIA THERMOSTAT FUND
In a Nutshell 18
At a Glance 19
Statement of Investments 73
Statement of Assets and Liabilities 74
Statement of Operations 75
Statement of Changes in Net Assets 76
Financial Highlights 78
Notes to Financial Statements 79
COLUMBIA ACORN FAMILY OF FUNDS
Statements of Assets and Liabilities 56
Statements of Operations 57
Statements of Changes in Net Assets 58
Financial Highlights 62
Notes to Financial Statements 67
Change in Independent Registered
Public Accounting Firm 83
Columbia Acorn Family of Funds Information 84
Board of Trustees and
Management of Acorn 88
THE DISCUSSION IN THIS REPORT OF PORTFOLIO COMPANIES IS FOR ILLUSTRATION ONLY
AND IS NOT A RECOMMENDATION OF INDIVIDUAL STOCKS. THE INFORMATION IS BELIEVED TO
BE ACCURATE, BUT THE INFORMATION AND THE VIEWS OF THE PORTFOLIO MANAGERS MAY
CHANGE AT ANY TIME WITHOUT NOTICE AND THE PORTFOLIO MANAGERS MAY ALTER A FUND'S
PORTFOLIO HOLDINGS BASED ON THESE VIEWS AND THE FUND'S CIRCUMSTANCES AT THAT
TIME.
1
Columbia Acorn Family of Funds
>MID-YEAR DISTRIBUTIONS
The following table details the funds' mid-year distributions. The record date
was June 2, 2004, and the payable date was June 3, 2004. Columbia Acorn USA and
Columbia Acorn Select did not have any mid-year distributions.
LONG-TERM SHORT-TERM ORDINARY REINVESTMENT
CAPITAL GAINS CAPITAL GAINS INCOME PRICE
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Columbia Acorn Fund Class A $ 0.0283 None None $ 23.45
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Columbia Acorn Fund Class B and C $ 0.0283 None None $ 22.90
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Columbia Acorn International Class A None None $ 0.1546 $ 23.32
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Columbia Acorn International Class B None None $ 0.0399 $ 22.96
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Columbia Acorn International Class C None None $ 0.0399 $ 22.97
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Columbia Acorn International Select
Class A None None $ 0.0278 $ 15.09
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Columbia Thermostat Fund Class A $ 0.0028 $ 0.0145 None $ 12.43
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Columbia Thermostat Fund Class B
and Class C $ 0.0028 $ 0.0145 None $ 12.41
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>NET ASSET VALUE PER SHARE as of 6/30/04
COLUMBIA COLUMBIA ACORN COLUMBIA
COLUMBIA ACORN COLUMBIA INTERNATIONAL COLUMBIA THERMOSTAT
ACORN FUND INTERNATIONAL ACORN USA SELECT ACORN SELECT FUND
- -------------------------------------------------------------------------------------------------------------------
Class A $ 24.11 $ 24.20 $ 22.74 $ 15.50 $ 19.30 $ 12.61
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Class B $ 23.54 $ 23.81 $ 22.23 $ 15.12 $ 18.84 $ 12.58
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Class C $ 23.54 $ 23.82 $ 22.25 $ 15.15 $ 18.84 $ 12.58
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2
>SHARE CLASS PERFORMANCE Average Annual Total Returns through 6/30/04
CLASS A CLASS B CLASS C
WITHOUT WITH WITHOUT WITH WITHOUT WITH
SALES CHARGE SALES CHARGE SALES CHARGE SALES CHARGE SALES CHARGE SALES CHARGE
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COLUMBIA ACORN
FUND (10/16/2000)
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3 months* 1.51% -4.33% 1.29% -3.71% 1.33% 0.33%
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Year to date* 8.73% 2.48% 8.36% 3.36% 8.36% 7.36%
- ----------------------------------------------------------------------------------------------------------------------------
1 year 35.21% 27.43% 34.27% 29.27% 34.27% 33.27%
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3 years 9.63% 7.49% 8.90% 8.05% 8.90% 8.90%
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Life of fund 12.31% 10.53% 11.59% 10.99% 11.59% 11.59%
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COLUMBIA ACORN
INTERNATIONAL (10/16/2000)
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3 months* 1.63% -4.21% 1.41% -3.59% 1.45% 0.45%
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Year to date* 8.51% 2.27% 8.07% 3.07% 8.17% 7.17%
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1 year 40.65% 32.56% 39.73% 34.73% 39.79% 38.79%
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3 years 6.76% 4.67% 6.03% 5.13% 6.06% 6.06%
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Life of fund -0.17% -1.75% -0.82% -1.51% -0.81% -0.81%
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COLUMBIA ACORN USA
(10/16/2000)
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3 months* 4.55% -1.46% 4.32% -0.68% 4.36% 3.36%
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Year to date* 9.64% 3.34% 9.18% 4.18% 9.28% 8.28%
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1 year 34.00% 26.30% 33.03% 28.03% 33.15% 32.15%
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3 years 7.01% 4.92% 6.30% 5.41% 6.31% 6.31%
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Life of fund 14.61% 12.79% 13.87% 13.30% 13.90% 13.90%
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COLUMBIA ACORN INT'L
SELECT (10/16/2000)
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3 months* 0.57% -5.21% 0.40% -4.60% 0.40% -0.60%
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Year to date* 7.46% 1.28% 7.08% 2.08% 7.14% 6.14%
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1 year 38.03% 30.09% 36.96% 31.96% 36.98% 35.98%
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3 years 4.65% 2.60% 3.93% 2.99% 3.97% 3.97%
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Life of fund -3.31% -4.84% -4.00% -4.78% -3.95% -3.95%
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COLUMBIA ACORN
SELECT (10/16/2000)
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3 months* 1.79% -4.06% 1.62% -3.38% 1.62% 0.62%
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Year to date* 7.16% 1.00% 6.80% 1.80% 6.80% 5.80%
- ----------------------------------------------------------------------------------------------------------------------------
1 year 19.81% 12.93% 19.03% 14.03% 19.03% 18.03%
- ----------------------------------------------------------------------------------------------------------------------------
3 years 9.98% 7.83% 9.26% 8.41% 9.28% 9.28%
- ----------------------------------------------------------------------------------------------------------------------------
Life of fund 10.80% 9.05% 10.09% 9.46% 10.09% 10.09%
- ----------------------------------------------------------------------------------------------------------------------------
COLUMBIA THERMOSTAT
FUND (3/3/2003)
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3 months* -0.18% -5.92% -0.49% -5.46% -0.41% -1.41%
- ----------------------------------------------------------------------------------------------------------------------------
Year to date* 2.66% -3.24% 2.25% -2.75% 2.25% 1.25%
- ----------------------------------------------------------------------------------------------------------------------------
1 year 12.58% 6.11% 11.77% 6.77% 11.77% 10.77%
- ----------------------------------------------------------------------------------------------------------------------------
Life of fund 19.18% 14.01% 18.30% 15.46% 18.30% 18.30%
- ----------------------------------------------------------------------------------------------------------------------------
*Not annualized.
PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND
PRINCIPAL VALUE OF AN INVESTMENT IN A FUND WILL FLUCTUATE SO THAT FUND SHARES,
WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. PERFORMANCE
CHANGES OVER TIME. VISIT COLUMBIAFUNDS.COM FOR DAILY UPDATES.
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM 5.75% SALES CHARGE FOR CLASS
A SHARES, THE APPROPRIATE CLASS B CONTINGENT DEFERRED SALES CHARGE FOR THE
HOLDING PERIOD AFTER PURCHASE AS FOL- LOWS: THROUGH FIRST YEAR--5%, SECOND
YEAR--4%, THIRD YEAR--3%, FOURTH YEAR--3%, FIFTH YEAR--2%, SIXTH YEAR--1%,
THEREAFTER--0%; AND THE CLASS C CONTINGENT DEFERRED SALES CHARGE OF 1% FOR THE
FIRST YEAR ONLY. PERFORMANCE OF THE DIFFERENT SHARE CLASSES WILL VARY BASED ON
DIFFERENCES IN SALES CHARGES AND FEES ASSOCIATED WITH EACH CLASS.
Performance results reflect any voluntary waivers or reimbursements of Fund
expenses by the Advisor or its affiliates. Absent these waivers or reimburse-
ment arrangements, performance results would have been lower.
3
COLUMBIA ACORN FAMILY OF FUNDS
>FUND PERFORMANCE VS. BENCHMARKS Class A Shares, without sales charge,
Average Annual Total Returns through 6/30/04
2ND* YEAR TO* 1 3 LIFE
QUARTER DATE YEAR YEARS OF FUND
- ---------------------------------------------------------------------------------------
COLUMBIA ACORN
FUND (10/16/2000) 1.51% 8.73% 35.21% 9.63% 12.31%
- ---------------------------------------------------------------------------------------
S&P 500 1.72% 3.44% 19.11% -0.69% -3.37%
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Russell 2500 0.34% 6.24% 32.21% 7.40% 7.97%
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Russell 2000 0.47% 6.76% 33.37% 6.24% 7.19%
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Lipper Small-Cap
Core Funds Index 1.56% 7.76% 32.80% 7.22% 8.27%
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Lipper Mid-Cap
Core Funds Index 1.05% 5.51% 26.28% 4.34% 3.19%
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COLUMBIA ACORN
INTERNATIONAL (10/16/2000) 1.63% 8.51% 40.65% 6.76% -0.17%
- ---------------------------------------------------------------------------------------
Citigroup EMI
Global ex-US -0.24% 9.52% 44.13% 13.29% 8.18%
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MSCI EAFE 0.22% 4.56% 32.37% 3.87% -0.91%
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Lipper Int'l Small-
Cap Funds Index 1.27% 11.16% 45.62% 12.44% 6.38%
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COLUMBIA ACORN USA
(10/16/2000) 4.55% 9.64% 34.00% 7.01% 14.61%
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Russell 2000 0.47% 6.76% 33.37% 6.24% 7.19%
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Lipper Small-Cap
Core Funds Index 1.56% 7.76% 32.80% 7.22% 8.27%
- ---------------------------------------------------------------------------------------
S&P 500 1.72% 3.44% 19.11% -0.69% -3.37%
- ---------------------------------------------------------------------------------------
COLUMBIA ACORN INT'L
SELECT (10/16/2000) 0.57% 7.46% 38.03% 4.65% -3.31%
- ---------------------------------------------------------------------------------------
Citigroup World ex-US
Cap Range $2-10B -1.23% 7.29% 42.32% 10.36% 6.71%
- ---------------------------------------------------------------------------------------
MSCI EAFE 0.22% 4.56% 32.37% 3.87% -0.91%
- ---------------------------------------------------------------------------------------
Lipper International
Funds Index -1.08% 3.86% 29.36% 3.93% -0.27%
- ---------------------------------------------------------------------------------------
COLUMBIA ACORN
SELECT (10/16/2000) 1.79% 7.16% 19.81% 9.98% 10.80%
- ---------------------------------------------------------------------------------------
S&P MidCap 400 0.97% 6.08% 27.98% 6.58% 6.50%
- ---------------------------------------------------------------------------------------
Lipper Mid-Cap
Growth Index 1.32% 5.28% 23.14% -2.76% -9.45%
- ---------------------------------------------------------------------------------------
S&P 500 1.72% 3.44% 19.11% -0.69% -3.37%
- ---------------------------------------------------------------------------------------
COLUMBIA THERMOSTAT
FUND (3/3/2003) -0.18% 2.66% 12.58% -- 19.18%
- ---------------------------------------------------------------------------------------
S&P 500 1.72% 3.44% 19.11% -- 27.84%
- ---------------------------------------------------------------------------------------
Lehman U.S Credit
Intermediate Bond Index -2.82% -0.08% 0.44% -- 3.50%
- ---------------------------------------------------------------------------------------
Lehman U.S. Govt.
Intermediate Bond Index -2.30% -0.15% -0.48% -- 0.91%
- ---------------------------------------------------------------------------------------
Lipper Flexible
Portfolio Funds Index -0.11% 2.25% 14.64% -- 21.23%
- ---------------------------------------------------------------------------------------
*Not annualized.
PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND
PRINCIPAL VALUE OF AN INVESTMENT IN A FUND WILL FLUCTUATE SO THAT FUND SHARES,
WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. PERFORMANCE
CHANGES OVER TIME. VISIT COLUMBIAFUNDS.COM FOR DAILY UPDATES.
DESCRIPTION OF INDEXES: S&P 500 is a broad, market-weighted average of U.S.
blue-chip company stock performance. S&P MIDCAP 400 is a broad market-weighted
index of 400 stocks that are in the next size/tier down from the S&P 500.
RUSSELL 2000 is a market-weighted index of 2000 smaller U.S. companies, formed
by taking the largest 3,000 companies and eliminating the largest 1,000. RUSSELL
2500 is the smallest 2,500 U.S. companies from this same group. CITIGROUP EMI
GLOBAL EX-US is the bottom 20% of institutionally investable capital of
developed and emerging countries, selected by index sponsor, outside the U.S.
MSCI EAFE is Morgan Stanley's Europe, Australasia and Far East Index, a widely
recognized international benchmark that comprises 20 major markets in proportion
to world stock market capitalization. CITIGROUP WORLD EX-US CAP RANGE $2-$10B is
a subset of the Broad Market Index, representing a mid-cap developed market
index excluding the U.S. LIPPER INDEXES include the largest funds tracked by
Lipper, Inc. in the named category. LIPPER MID-CAP GROWTH INDEX, 30 mid-cap
growth funds; LIPPER MID-CAP CORE FUNDS INDEX, 30 mid-cap core funds; LIPPER
INTERNATIONAL FUNDS INDEX, 30 largest non-U.S. funds, not including non-U.S.
small-cap funds; LIPPER INTERNATIONAL SMALL-CAP FUNDS INDEX, 10 largest non-U.S.
funds investing in small-cap companies, including Columbia Acorn International;
LIPPER SMALL-CAP CORE FUNDS INDEX, 30 largest small-cap core funds, including
Columbia Acorn Fund. LIPPER FLEXIBLE PORTFOLIO FUNDS INDEX is an equal dollar
weighted index of the 30 largest mutual funds within the Flexible Portfolio fund
classification, as defined by Lipper. LEHMAN U.S. GOVERNMENT INTERMEDIATE BOND
INDEX is made up of 1 to 10 year treasury and agency bonds, excluding targeted
investor notes and state and local government series bonds. The LEHMAN U.S.
CREDIT INTERMEDIATE BOND INDEX is the intermediate component of the U.S. Credit
Index. The U.S. Credit Index includes publicly issued U.S. corporate and foreign
debentures and secured notes that meet specified maturity, liquidity, and
quality requirements. All indexes are unmanaged and returns include reinvested
distributions. A more complete description of each index is included in the
Fund's statement of additional information. It is not possible to invest
directly in an index.
4
>Squirrel Chatter: WHY THE HECK SHOULD WE OWN SMALL-CAP STOCKS?
[Photo of Ralph Wanger]
I often get asked the question, "Why own small caps rather than the great
American blue chip companies?" My answer is that many of the so-called blue chip
companies remind me of the Rolling Stones: Once great but 30 years past their
prime. The rapid change and growth of the past 30 years created today's
corporate behemoths. But that was then. The world has moved on and the
environment is different. This creates a big problem for old giants as the
market embraces new companies that are able to adapt to the world as it is now.
The cycle of creation, growth, maturity and decline can be seen in all
companies.
One of the most successful companies for generations was Eastman Kodak.
Today people are switching from film cameras to digital cameras so Kodak's
expertise in making film is fast becoming obsolete. The company is trying
desperately to figure out how to survive in today's world but it is likely to be
a considerably smaller and less profitable company in the years to come.
In the computer industry, IBM was once considered so dominant that the
government brought an antitrust action against the company to keep it from
completely dominating the world. Well, IBM does not dominate the world, but the
antitrust settlement was not the reason for it. IBM had a lock on the mainframe
computer market but PC networks rendered IBM's position irrelevant. IBM is still
a big company but it is no longer dominant in the computer industry.
We also see a great deal of American manufacturing moving overseas,
especially to China. An example is Levi's, a famous brand that was synonymous
with blue jeans. Today Levi's no longer manufactures, distributes or designs
blue jeans anywhere. Levi's owns the brand and collects royalties but the rest
of the business has been turned over to a Hong Kong company named Li & Fung. Li
& Fung outsources the entire production process for Levi's jeans.
This is not the first time foreign markets have encroached upon U.S.
manufacturing. Twenty years ago we were worried about Japan. In area after area,
Japanese companies were knocking off U.S. companies. Ford and General Motors
were suddenly marginalized when Toyota came on the scene. General Motors has
gone from the most powerful company in the United States to what we consider an
unhealthy company with low profits and a poor balance sheet.
Today, the Internet has created new businesses like Ebay, Expedia, and
Amazon and put enormous pressure on old-line companies. Voice over Internet
protocol is likely to do the same thing to the telephone industry that digital
cameras did to Kodak. Free phone calls via the Internet is not the pricing model
that big phone companies have in mind. The music industry has been severely hurt
by file sharing online just as the post office and FedEx are losing market share
to email. There is a great deal of innovation required to keep a business sound
in today's technology-driven world.
One business crushed by the Internet was Encyclopedia Britannica. Believe
it or not, there was a time when research was conducted using books. Now, we
Google. Few of us have a set of Encyclopedia Britannica at home today. Thirty
years ago, we would have. Tornadoes blow away houses everyday that would have
been safe if they only had three hundred pounds of encyclopedias ballasting the
living room like we used to.
Big companies not only have to manage technological change, but they have
to do it in a world of union contracts that have seriously complicated their
ability to change with the times. They must also continually adapt to political
and regulatory changes. Sarbanes-Oxley requirements, for example, have increased
accounting costs for companies.
We think one of the next big battles already underway is with large
pharmaceutical companies. It's fairly well known that you can buy prescription
drugs cheaper in Canada than you can in the United States. Foreign countries
have discovered that they can "free ride" on American-company drug prices
because they don't have to pay for research and development (R&D). Some people
are working to figure out how to increase the amount of drugs imported from
Canada but it makes no sense to make a product in Indianapolis, ship it to
Toronto, and then ship it back to Indianapolis. Government regulation may soon
require that U.S. pharmaceutical companies price drugs sold in the U.S. market
the same as those sent to foreign markets. Perhaps, if drug-company R&D is
5
retained, a subsidy will be issued by the government to cover that cost. If this
happens, major drug companies will find their profits severely reduced. The drug
industry, which was the center of institutional portfolios for the last 50 years
because of steady, stable growth, may be less attractive over the next couple of
decades. This sort of shift has happened before.
Forty years ago electric utilities served as the stable growth base for
institutional portfolios. I can remember having arguments with Duff and Phelps
analysts about whether Commonwealth Edison would have a six-percent growth rate
or a six-and-a-half-percent growth rate in the future. The distinction seemed to
be makeable, reasonable and important. Today, electric utilities don't have
long-term growth rates. They are highly cyclical businesses with profits that
can be variable from one year to the next and are now considered anything but
the base of a stable growth portfolio. While our funds don't own big
pharmaceutical companies or big electric utilities, we think there will always
be small companies that find ways to make money and grow as the old favorites
peak and start to mature and decline.
What kinds of things do the Columbia Acorn Funds look for in small-cap
investing? We've found opportunities in the financial area. We believe regional
banks and savings and loans have the potential to grow and prosper. Sometimes
this occurs because they are in areas where giant banks haven't shown up yet.
Here in Chicago, a few very large banks headquartered elsewhere dominate the
city's banking industry. Still, some people prefer to bank at smaller local
banks where they are treated more as a customer than an account number. Some of
the smaller banks we own in our funds are Glacier Bancorp in Montana, Republic
in Michigan, and Peoples Bank Bridgeport in Connecticut. These companies will
often prosper on their own. If they are taken over by one of the big banks, the
funds would make a profit that way.
Specialty retail is also an interesting area for the small-cap investor.
Retail is dominated by large shopping malls. If someone can formulate a new
retail idea and prove it out with a half-dozen stores, it doesn't take very long
to increase from five stores to 500 because malls always look for new hot
concepts. Some of the companies we own that have done well are Christopher &
Banks, Chico's FAS, Hot Topic, Cheesecake Factory and AFC Enterprises.
An investor may want to look for companies that have very strong brands
such as Procter & Gamble and Gillette. Don't make the mistake of thinking
smaller companies lack recognizable brands. One of Columbia Acorn Fund's most
successful stocks has been Harley-Davidson, the only brand that we can think of
that people tattoo on their bodies. Coach, a top brand in leather goods, is
another small-cap stock owned in the funds. We also own Scotts in lawn care;
International Speedway in NASCAR racing; Carnival in cruise lines and Weight
Watchers in weight watching.
What we look for in all of these companies is what we call a "reason to
own." We need to find a factor that we believe will give a company a reason to
prosper over a long period of time. Our favorite theme under "reason to own" is
Downstream from Technology. Making microchips is a very important business but
when you get into the manufacturing of high-tech devices, it is notoriously
competitive with very short product life cycles, a high degree of price
competition and the profitability of these companies is often very short lived.
It is hard to prosper in a business when you must cut prices 30% every year. We
think it is better to own companies that are customers of these electronic
companies. Getty Images is downstream from technology and one of our favorite
stocks. The company sells photography over the Internet. They have 2.6 million
photos that you can search for by subject and download at a moderate price. If
you want to do an ad with a photo of a retired couple walking on the beach,
buying one of Getty's pictures can save you the money and time required to
create the same shot.
Other downstream stocks that have done well for our funds include Zebra
Technologies, a manufacturer of bar code printers, and International Game
Technology (IGT). IGT has taken a low-priced, microprocessor and used it to
create an electronic slot machine, capitalizing on the American people's
willingness to spend about $30 an hour to play a fairly dull video game. This
willingness also has created the modern gaming industry, which has spread into
most states across the country.
6
1-800-922-6769
Not all technology is electronic. Nektar Therapeutics uses biotech and
technology to generate inhaleable insulin to treat diabetes, one of the most
serious health problems facing Americans. We believe anyone who can change
insulin therapy from injections to some less objectionable form is likely to
have a good business.
Small growth companies may succeed because they grow in the niche areas
between the giants. Of course, not all small companies work but when they do,
there is potential for significant gains. Columbia Acorn Fund profits on stocks
such as IGT and Harley-Davidson have been on the order of 100:1. A good idea, a
hard-working entrepreneur, and long-term equity owners should continue to
partner together to build winning companies in the future.
/s/ Ralph Wanger
Ralph Wanger
FOUNDER, ADVISOR AND TRUSTEE
COLUMBIA WANGER ASSET MANAGEMENT, L.P.
________________________________________________________________________________
THIS ESSAY WAS TAKEN FROM A SPEECH GIVEN BY RALPH WANGER AT THE THINKEQUITY
CONFERENCE HELD IN CHICAGO ON JUNE 22, 2004.
AS OF JUNE 30, 2004, FUND POSITIONS IN THE COMPANIES MENTIONED WERE: LI & FUNG:
COLUMBIA ACORN FUND, 0.1%; COLUMBIA ACORN INTERNATIONAL SELECT FUND, 1.6%.
GLACIER BANCORP: COLUMBIA ACORN FUND, 0.5%. REPUBLIC: COLUMBIA ACORN FUND, 0.2%.
PEOPLES BANK BRIDGEPORT: COLUMBIA ACORN FUND, 0.8%. CHRISTOPHER & BANKS:
COLUMBIA ACORN FUND, 0.5%; COLUMBIA ACORN USA, 0.8%. CHICO'S FAS: COLUMBIA ACORN
FUND, 0.9%. HOT TOPIC: COLUMBIA ACORN FUND, 0.2%. CHEESECAKE FACTORY: COLUMBIA
ACORN FUND, 0.1%. AFC ENTERPRISES: COLUMBIA ACORN FUND, 0.3%. HARLEY-DAVIDSON:
COLUMBIA ACORN FUND, 0.9%; COLUMBIA ACORN SELECT, 6.3%. COACH: COLUMBIA ACORN
FUND, 1.0%; COLUMBIA ACORN USA, 0.4%; COLUMBIA ACORN SELECT, 2.9%. SCOTTS
COMPANY: COLUMBIA ACORN FUND, 0.5%; COLUMBIA ACORN USA, 1.4%. INTERNATIONAL
SPEEDWAY MOTORS: COLUMBIA ACORN FUND, 0.3%; COLUMBIA ACORN USA, 0.6%; COLUMBIA
ACORN SELECT, 2.3%. CARNIVAL: COLUMBIA ACORN FUND, 0.2%. WEIGHT WATCHERS:
COLUMBIA ACORN FUND, 0.2%; COLUMBIA ACORN USA, 0.3%; COLUMBIA ACORN SELECT,
2.9%. GETTY IMAGES: COLUMBIA ACORN FUND, 0.6%; COLUMBIA ACORN USA, 0.8%. ZEBRA
TECHNOLOGIES: COLUMBIA ACORN FUND, 0.3%; COLUMBIA ACORN USA, 1.9%. INTERNATIONAL
GAME TECHNOLOGY: COLUMBIA ACORN FUND, 2.1%. NEKTAR THERAPEUTICS: COLUMBIA ACORN
FUND, 0.2%; COLUMBIA ACORN USA, 0.9%.
COMPANIES THAT WERE MENTIONED BUT NOT LISTED ABOVE WERE NOT HELD BY ANY OF THE
COLUMBIA ACORN FUNDS AS OF JUNE 30, 2004.
THE COMPANIES NAMED ARE FOR ILLUSTRATION PURPOSES ONLY AND ARE NOT INTENDED TO
BE A RECOMMENDATION TO BUY OR SELL ANY STOCK.
7
Columbia Acorn Fund
>In a Nutshell
[Photo of Charles P. McQuaid] [Photo of Robert A. Mohn]
Columbia Acorn Fund rose 1.51% (Class A shares, without sales charge) in the
second quarter, somewhat more than its smaller cap benchmarks and in line with
the large-cap S&P 500. In the first half of 2004, Columbia Acorn grew 8.73%,
beating all of its benchmarks (see Page 4 for performance data). Performance for
both periods was helped by our investments in energy. We also profited from good
stock picking.
On the advice of our energy analyst, Jason Selch, we had built energy to
about 9% of the Fund--nearly twice the energy weighting of the Russell 2500
Index. Energy prices remained high, and both our large weighting and fine stock
selection paid off. Quicksilver hit pay dirt, and was Columbia Acorn's largest
percentage winner in both periods, rising about 73% in the quarter and doubling
in the half. XTO Energy was the Fund's largest dollar winner year-to-date,
gaining over $200 million for shareholders while rising 32%. Other energy
successes included Western Gas and Ultra Petroleum, each up more than 24% in the
quarter and 35% in the half.
Other excellent stock picks included Rogers, a provider of electronic
components, up on fine earnings. Retailer Urban Outfitters also jumped, as
amazing sales increases drove earnings. Cell phone service provider Western
Wireless benefited from growth overseas. Each of these stocks jumped at least
24% in the quarter and 57% in the half.
Gaming stocks were volatile. International Game Technology was Columbia
Acorn's largest dollar winner in the first quarter but its largest dollar loser
in the second, despite making its growth targets. For the half, it rose 9%. We
trimmed the stock due to valuation concerns, locking in fantastic gains.
Alliance Gaming gained 30% in the first quarter, but dropped 47% in the second
quarter on lower earnings expectations. Technology was tough year-to-date, as
gains in hardware stocks were more than offset by drops in the Fund's software
and service companies. After a 49% gain in the first quarter, Skillsoft
Publishing retreated 41% on an order shortfall.
Columbia Acorn's foreign stocks rose over 2% in the quarter and 10% in the
half. Gambro, a leading worldwide dialysis provider, and Rhoen-Klinikum, a
leading private hospital company in Germany, each rose more than 25% in the
quarter. United Kingdom-based Tullow Oil gained 49% in the half. We've built the
Fund's foreign stock position to 15% of assets, and plan to stay near this level
since we believe foreign stocks appear attractive.
Most of the Fund's companies are reporting what we consider good business
conditions and excellent earnings gains. Macro economic concerns recently have
kept a lid on stock prices. We hope that earnings gains will rule in the future.
/s/ Charles P. McQuaid /s/ Robert A. Mohn
Charles P. McQuaid Robert A. Mohn
LEAD PORTFOLIO MANAGER CO-PORTFOLIO MANAGER
DEMOGRAPHY IS DESTINY
- --------------------------------------------------------------------------------
The baby boomer population continues to provide investment opportunities. Baby
boomers are aging worldwide and many are becoming obese. Age plus obesity has
caused an epidemic of diabetes. This disease often causes kidney failure.
Gambro, headquartered in Sweden, operates dialysis centers and sells renal
products in many parts of the world. Columbia Wanger Asset Management analyst
Stephen Kusmierczak concluded that Gambro was improving its cost structure and
enhancing its sales mix. He saw through goodwill amortization charges and valued
the stock based on free cash flow. When Stephen's research indicated that the
market expectations concerning Medicare dialysis reimbursement may be unduly
pessimistic, we added to Columbia Acorn Fund's position. Good research paid off
as Gambro's stock rose 30% in the second quarter.
INVESTMENTS IN SMALL-CAP COMPANIES MAY BE SUBJECT TO GREATER VOLATILITY AND
PRICE FLUCTUATIONS BECAUSE THEY MAY BE THINLY TRADED AND LESS LIQUID THAN
INVESTMENTS IN LARGER COMPANIES. INVESTMENTS IN FOREIGN SECURITIES HAVE SPECIAL
RISKS, INCLUDING POLITICAL OR ECONOMIC INSTABILITY, HIGHER COSTS, DIFFERENT
REGULATIONS, ACCOUNTING STANDARDS, TRADING PRACTICES AND LEVELS OF INFORMATION,
AND CURRENCY EXCHANGE RATE FLUCTUATIONS.
AS OF 6/30/04, THE FUND'S POSITIONS IN THE HOLDINGS MENTIONED WERE: QUICKSILVER,
0.3%; XTO ENERGY, 1.8%; WESTERN GAS, 0.7%; ULTRA PETROLEUM, 0.7%; ROGERS, 0.3%;
URBAN OUTFITTERS, 0.4%; WESTERN WIRELESS, 0.7%; INTERNATIONAL GAME TECHNOLOGY,
2.1%; ALLIANCE GAMING, 0.4%; SKILLSOFT PUBLISHING, 0.6%; RHOEN-KLINIKUM, 0.2%;
TULLOW OIL, 0.3%; GAMBRO, 0.2%.
8
1-800-922-6769
Columbia Acorn Fund TICKER SYMBOL: LACAX
>At a Glance TOTAL NET ASSETS: $12,289.6 MILLION
PRETAX AND AFTER-TAX AVERAGE ANNUAL TOTAL RETURNS (BASED ON CLASS A SHARE
RETURNS)
>through June 30, 2004
YEAR TO LIFE
DATE* 1 YEAR 3 YEARS OF FUND
----- ------ ------- -------
Returns before NAV 8.73% 35.21% 9.63% 12.31%
taxes POP 2.48 27.43 7.49 10.53
- -------------------------------------------------------------------------
Returns after taxes NAV 8.72 35.16 9.59 11.48
on distributions POP 2.46 27.39 7.45 9.72
- -------------------------------------------------------------------------
Returns after taxes NAV 5.70 22.94 8.28 10.28
on distributions and POP 1.64 17.88 6.42 8.72
sale of fund shares
- -------------------------------------------------------------------------
S&P 500 (pretax) 3.44 19.11 -0.69 -3.37
- -------------------------------------------------------------------------
Russell 2500 (pretax) 6.24 32.21 7.40 7.97
- -------------------------------------------------------------------------
Russell 2000 (pretax) 6.76 33.37 6.24 7.19
Past performance, before and after taxes, cannot predict future investment
results. After-tax returns are calculated using the highest historical
individual federal marginal income tax rates, and do not reflect the impact of
state and local taxes. Returns after taxes on distributions and sale of fund
shares reflect the additional tax impact of long-term gains or losses realized
when fund shares are sold. The returns are taxed at the maximum rate and assume
shares were purchased at the beginning of the period. Actual after-tax returns
depend on the investor's tax situation and may differ from those shown.
After-tax returns are not relevant to investors who hold their fund shares
through tax-deferred arrangements such as 401(k) plans or individual retirement
accounts. After-tax returns are shown for Class A shares only; after-tax returns
for other share classes will vary. Indexes do not reflect any deduction for
fees, expenses or taxes. Investment returns and principal value may fluctuate,
resulting in a gain or loss on sale. PUBLIC OFFERING PRICE (POP) RETURNS INCLUDE
THE MAXIMUM SALES CHARGE OF 5.75% FOR CLASS A SHARES. NET ASSET VALUE (NAV)
RETURNS DO NOT INCLUDE SALES CHARGES OR CONTINGENT DEFERRED SALES CHARGES
(CDSC).
*Year to date data not annualized.
COLUMBIA ACORN FUND PORTFOLIO DIVERSIFICATION
>as a % of net assets, as of June 30, 2004
[PIE CHART]
Consumer 21.8%
Goods/Services
Industrial 13.5%
Goods/Services
Finance 12.3%
Other* 6.7%
Health Care 9.1%
Energy/Minerals 9.1%
Real Estate 2.6%
Information 24.9%
Software/Services 11.6%
Computer Related Hardware 8.0%
Media 2.1%
Telecommunications 3.2%
*Other includes cash and other assets less liabilities of 5.7%. Foreign equities
within the portfolio were 15.0% diversified by country as follows: 9.0% Europe;
1.7% Asia without Japan; 2.0% Canada; 1.3% Japan; 0.5% Australia/New Zealand;
0.5% Latin America.
THE VALUE OF A $10,000 INVESTMENT IN COLUMBIA ACORN FUND
>October 16, 2000 through June 30, 2004
Illustration is based on a hypothetical $10,000 investment from inception in
Class A shares of the Fund, which includes the 5.75% maximum initial sales
charge. Performance may reflect any voluntary waiver or reimbursement of Fund
expenses by the Advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower. The Russell 2500 is the
smallest 2,500 U.S. companies taken from a group of the largest 3000 companies.
The index is unmanaged and returns for the index and the Fund include reinvested
dividends and capital gains. It is not possible to invest directly in an index.
PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND
PRINCIPAL VALUE OF AN INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT FUND SHARES,
WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. PERFORMANCE
CHANGES OVER TIME. VISIT COLUMBIAFUNDS.COM FOR DAILY UPDATES.
[MOUNTAIN CHART]
WITHOUT CLASS A CLASS B CLASS C
SALES CHARGE $15,388 $15,026 $15,026
- ------------------------------------------------
WITH
SALES CHARGE $14,503 $14,726 $15,026
COLUMBIA COLUMBIA
ACORN FUND - A ACORN FUND - A
AT NAV WITH SALES CHARGE RUSSELL 2500
--------------- ----------------- ------------
10/16/00 10000.00 9425.00 10000.00
10/31/00 10274.00 9683.25 10431.90
9733.59 9173.91 9513.81
12/31/00 10739.10 10121.60 10333.20
10932.40 10303.80 10672.80
10651.40 10039.00 9985.52
3/31/01 10164.60 9580.17 9437.70
11058.10 10422.30 10271.20
11527.00 10864.20 10580.10
6/30/01 11678.00 11006.50 10730.30
11449.10 10790.80 10346.60
10992.30 10360.20 10007.60
9/30/01 9495.12 8949.15 8712.50
9901.52 9332.18 9162.99
10656.00 10043.30 9904.06
12/31/01 11335.90 10684.00 10459.30
11221.40 10576.10 10329.40
11074.40 10437.60 10148.60
3/31/02 11882.80 11199.50 10850.20
11850.70 11169.30 10822.60
11488.10 10827.50 10505.40
6/30/02 10902.20 10275.30 9913.40
9602.65 9050.50 8730.34
9679.47 9122.90 8756.74
9/30/02 9099.67 8576.44 8062.97
9481.86 8936.65 8325.77
10093.40 9513.07 9005.47
12/31/02 9768.43 9206.75 8598.02
9533.01 8984.86 8369.56
9380.48 8841.10 8168.45
3/31/03 9494.92 8948.97 8246.32
10316.20 9723.05 8981.24
11042.50 10407.50 9864.53
6/30/03 11380.40 10726.00 10053.00
11908.50 11223.70 10593.40
12526.50 11806.20 11083.60
9/30/03 12379.90 11668.10 10932.80
13386.40 12616.70 11796.60
13820.10 13025.50 12240.70
12/31/03 14151.80 13338.10 12510.90
14661.30 13818.30 12967.40
14941.30 14082.20 13167.90
3/31/04 15158.00 14286.40 13247.00
14609.30 13769.20 12610.70
14870.80 14015.70 12868.10
6/30/04 15388.00 14503.20 13291.50
COLUMBIA ACORN FUND TOP 10 HOLDINGS (AS A % OF NET ASSETS)
1. International Game Technology 2.1%
SLOT MACHINES & Progressive Jackpots
2. XTO Energy 1.8%
NATURAL GAS PRODUCER
3. Expeditors International of Washington 1.1%
INTERNATIONAL FREIGHT FORWARDER
4. Coach 1.0%
DESIGNER & RETAILER OF BRANDED LEATHER ACCESSORIES
5. AmeriCredit 0.9%
AUTO LENDING
6. Chico's FAS 0.9%
WOMEN'S SPECIALTY RETAILER
7. Harley-Davidson 0.9%
MOTORCYCLES & RELATED MERCHANDISE
8. Peoples Bank Bridgeport 0.8%
CONNECTICUT SAVINGS & Loan
9. TCF Financial 0.8%
GREAT LAKES BANK
10. Novell 0.8%
DIRECTORY, OPERATING SYSTEM & IDENTITY
MANAGEMENT SOFTWARE
The Fund's top 10 holdings and portfolio diversification vary with changes in
portfolio investments. See the Statement of Investments for a complete list of
the Fund's holdings.
9
COLUMBIA ACORN INTERNATIONAL
>In a Nutshell
[Photo of P. Zachary Egan] [Photo of Louis J. Mendes III]
Columbia Acorn International finished the quarter up 1.63% (Class A shares,
without sales charge), exceeding the Citigroup EMI Global ex-US benchmark
decline of 0.24%. By posting a positive result in a flat market, the Fund gained
back much of the ground lost relative to its benchmark in the first quarter. It
is now up 8.51% year-to-date, trailing the benchmark return of 9.52%. The Fund
also led the larger cap MSCI EAFE Index by 1.41% in the quarter and 3.95%
year-to-date. Stock selection, as opposed to country or sector weightings, was
the primary driver of performance in the second quarter.
Winners included Kappa Create, a sushi restaurant chain in Japan, which was
up 20% in the second quarter, after rising 31% in the first quarter. Geberit, a
Swiss manufacturer of bathroom plumbing systems, was up 23% in the quarter and
up 37% for the first half of the year. Energy prices remain high, which boosted
profitability for many energy exploration and production companies. A holding in
the United Kingdom, Tullow Oil, was up 23% in the quarter and nearly 49% for the
six months. Rhoen-Klinikum, a private hospital operator in Germany and the
Fund's second largest holding, also had a strong second quarter, rising 26%.
The Fund's biggest loser in the second quarter was ASE Test, a
semiconductor packaging and test services company, which was down 33% in the
quarter and 51% in the year-to-date period on concerns that excess capacity in
the semiconductor industry will weigh on profitability. Sales data for June,
however, show an 88% increase over numbers reported this time last year. While
the stock continues to exhibit volatility, we feel the fundamental investment
case remains intact. Another laggard was Jardine Lloyd Thompson Group, an
insurance broker in the United Kingdom, which was down over 20% for both the
quarter and the first half. Wah Lee Industrial, a Taiwanese distributor of
chemicals, materials and equipment, was down 15% for the quarter and 19% for the
first half.
We continued to increase the Fund's exposure to Japan in the quarter,
largely in businesses geared to the domestic economy, such as consumer goods and
services, and financials. We also built small positions in countries where the
Fund had little or no exposure in recent years. In South Africa, the Fund now
holds family clothing chain Edgars Consolidated Stores. In Brazil, Columbia
Acorn International participated in the initial public offering of Natura
Cosmeticos, a direct retailer of high-end skin care products. These investments
reflect the Fund's continuous efforts to locate value wherever it may be.
/s/ P. Zachary Egan /s/ Louis J. Mendes III
P. Zachary Egan Louis J. Mendes III
CO-PORTFOLIO MANAGER CO-PORTFOLIO MANAGER
PROFITS IN THE WIND
- --------------------------------------------------------------------------------
Gamesa manufactures and services wind-driven turbines and develops and operates
so-called "windfarms" for electric generation. Columbia Acorn International
built a position in the company two and a half years ago when we believed there
was considerable opportunity for the company to strengthen its balance sheet by
selling some of its Spanish windfarms. We felt that freeing up cash through
these asset sales would also allow the company to pursue higher return projects
outside of Spain. This strategy was so successful that management was looking to
return cash to shareholders within nine months of the Fund's initial investment,
and the share price has almost tripled over the holding period. While originally
an attempt to strengthen the financial position of the company, selling
windfarms is now viewed by management as a sustainable, high-return business
opportunity in itself. While some investors are skeptical about this strategic
direction, we believe that Gamesa, as a leading equipment supplier with an
intimate understanding of the planning and permit process, is indeed
well-positioned to benefit as a windfarm developer.
INVESTMENTS IN FOREIGN SECURITIES HAVE SPECIAL RISKS, INCLUDING POLITICAL OR
ECONOMIC INSTABILITY, HIGHER COSTS, DIFFERENT REGULATIONS, ACCOUNTING STANDARDS,
TRADING PRACTICES AND LEVELS OF INFORMATION, AND CURRENCY EXCHANGE RATE
FLUCTUATIONS. INVESTMENTS IN SMALL-CAP COMPANIES MAY BE SUBJECT TO GREATER
VOLATILITY AND PRICE FLUCTUATIONS BECAUSE THEY MAY BE THINLY TRADED AND LESS
LIQUID THAN INVESTMENTS IN LARGER COMPANIES.
AS OF 6/30/04, THE FUND'S POSITIONS IN THE HOLDINGS MENTIONED WERE: KAPPA
CREATE, 0.8%; GEBERIT, 1.0%; TULLOW OIL, 1.2%; RHOEN-KLINIKUM, 1.9%; ASE TEST,
0.5%; JARDINE LLOYD THOMPSON GROUP, 0.7%; WAH LEE INDUSTRIAL, 0.4%; EDGARS
CONSOLIDATED STORES, 0.3%; NATURA COSMETICOS, 0.5%; GAMESA, 0.7%.
10
1-800-922-6769
COLUMBIA ACORN INTERNATIONAL
>At a Glance TICKER SYMBOL: LAIAX
TOTAL NET ASSETS: $1,728.2 MILLION
PRETAX AND AFTER-TAX AVERAGE ANNUAL TOTAL RETURNS (BASED ON CLASS A SHARE
RETURNS)
>through June 30, 2004
YEAR TO LIFE
DATE* 1 YEAR 3 YEARS OF FUND
----- ------ ------- -------
Returns before NAV 8.51% 40.65% 6.76% -0.17%
taxes POP 2.27 32.56 4.67 -1.75
- --------------------------------------------------------------------------------
Returns after taxes NAV 8.26 40.55 6.69 -1.00
on distributions POP 2.03 32.47 4.60 -2.57
- --------------------------------------------------------------------------------
Returns after taxes NAV 5.53 26.63 5.77 -0.36
on distributions and POP 1.47 21.36 3.97 -1.69
sale of fund shares
- --------------------------------------------------------------------------------
Citigroup EMI Global 9.52 44.13 13.29 8.18
ex-US (pretax)
Past performance, before and after taxes, cannot predict future investment
results. After-tax returns are calculated using the highest historical
individual federal marginal income tax rates, and do not reflect the impact of
state and local taxes. Returns after taxes on distributions and sale of fund
shares reflect the additional tax impact of long-term gains or losses realized
when fund shares are sold. The returns are taxed at the maximum rate and assume
shares were purchased at the beginning of the period. Actual after- tax returns
depend on the investor's tax situation and may differ from those shown.
After-tax returns are not relevant to investors who hold their fund shares
through tax-deferred arrangements such as 401(k) plans or individual retirement
accounts. After-tax returns are shown for Class A shares only; after-tax returns
for other share classes will vary. The return after taxes on distributions may
be higher than the return before taxes due to qualified foreign tax credits.
Indexes do not reflect any deduction for fees, expenses or taxes. Investment
returns and principal value may fluctuate, resulting in a gain or loss on sale.
PUBLIC OFFERING PRICE (POP) RETURNS INCLUDE THE MAXIMUM SALES CHARGE OF 5.75%
FOR CLASS A SHARES. NET ASSET VALUE (NAV) RETURNS DO NOT INCLUDE SALES CHARGES
OR CONTINGENT DEFERRED SALES CHARGES (CDSC).
*Year to date data not annualized.
COLUMBIA ACORN INTERNATIONAL PORTFOLIO DIVERSIFICATION
>as a % of net assets, as of June 30, 2004
[PIE CHART]
Consumer 24.8%
Goods/Services
Finance 12.1%
Other* 5.1%
Information Technology 10.6%
Health Care 8.5%
Energy/Minerals 8.1%
Transportation 3.0%
Industrial 27.8%
Goods/Services
*Other includes cash and other assets less liabilities of 3.2%.
THE VALUE OF A $10,000 INVESTMENT IN COLUMBIA ACORN INTERNATIONAL
>October 16, 2000 through June 30, 2004
Illustration is based on a hypothetical $10,000 investment from inception in
Class A shares of the Fund, which includes the 5.75% maximum initial sales
charge. Performance may reflect any voluntary waiver or reimbursement of Fund
expenses by the Advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower. The Citigroup EMI
Global ex-US is Citigroup's index of the bottom 20% of institutionally
investable capital of developed and emerging countries, as selected by
Citigroup, excluding the U.S. The index is unmanaged and returns for both the
index and Fund include reinvested dividends and capital gains. It is not
possible to invest directly in an index.
PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND
PRINCIPAL VALUE OF AN INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT FUND SHARES,
WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. PERFORMANCE
CHANGES OVER TIME. VISIT COLUMBIAFUNDS.COM FOR DAILY UPDATES.
[MOUNTAIN CHART]
WITHOUT CLASS A CLASS B CLASS C
SALES CHARGE $9,938 $9,698 $9,702
- ------------------------------------------------
WITH
SALES CHARGE $9,366 $9,449 $9,702
COLUMBIA ACORN COLUMBIA ACORN
INTERNATIONAL - A INTERNATIONAL - A CITIGROUP EMI
AT NAV WITH SALES CHARGE GLOBAL EX-US
---------------- ----------------- ------------
10/16/00 10000.00 9425.00 10000.00
10/31/00 10153.00 9569.20 10000.00
9322.48 8786.44 9559.32
12/31/00 9513.60 8966.56 9932.93
9940.76 9369.16 10117.90
9222.04 8691.77 9724.76
3/31/01 8332.11 7853.02 8971.57
8651.23 8153.79 9558.77
8591.54 8097.53 9539.59
6/30/01 8167.12 7697.51 9215.96
7837.98 7387.30 8945.71
7675.74 7234.38 8921.10
9/30/01 6626.46 6245.44 7759.62
6939.23 6540.23 8074.91
7325.75 6904.52 8406.88
12/31/01 7459.81 7030.87 8476.11
7277.04 6858.61 8322.64
7252.30 6835.29 8461.93
3/31/02 7626.52 7187.99 9013.27
7874.38 7421.60 9200.94
7838.16 7387.47 9495.38
6/30/02 7516.79 7084.58 9125.04
6720.01 6333.61 8345.16
6610.48 6230.38 8295.11
9/30/02 6016.86 5670.89 7529.41
6045.14 5697.54 7699.57
6228.30 5870.18 7987.33
12/31/02 6232.66 5874.29 7892.24
6078.09 5728.60 7759.62
5911.55 5571.64 7621.16
3/31/03 5822.29 5487.51 7546.93
6350.95 5985.77 8258.41
6871.73 6476.61 8962.39
6/30/03 7066.20 6659.90 9296.87
7217.42 6802.42 9628.00
7535.71 7102.40 10088.40
9/30/03 7821.31 7371.58 10549.70
8417.29 7933.30 11317.00
8642.04 8145.12 11523.10
12/31/03 9160.56 8633.83 12234.60
9429.88 8887.66 12674.10
9780.67 9218.28 13111.20
3/31/04 9780.67 9218.28 13432.30
9564.52 9014.56 12981.10
9593.21 9041.60 12982.80
6/30/04 9937.81 9366.38 13389.00
COLUMBIA ACORN INTERNATIONAL TOP 10 HOLDINGS (AS A % OF NET ASSETS)
1. Anglo Irish Bank (Ireland) 2.1%
SMALL BUSINESS & MIDDLE MARKET BANKING
2. Rhoen-Klinikum (Germany) 1.9%
HOSPITAL MANAGEMENT
3. Neopost (France) 1.5%
POSTAGE METERS
4. Exel (United Kingdom) 1.4%
GLOBAL LOGISTICS & FREIGHT FORWARDING
5. Kerry Group (Ireland) 1.3%
FOOD INGREDIENTS
6. Grafton Group (Ireland) 1.3%
BUILDERS, WHOLESALERS & DIY Retailing
7. Talisman Energy (Canada) 1.3%
OIL & GAS PRODUCER
8. Tullow Oil (United Kingdom) 1.2%
OIL & GAS PRODUCER
9. Venture (Singapore) 1.2%
ELECTRONIC CONTRACT MANUFACTURER
10. Daito Trust Construction 1.1%
(JAPAN) APARTMENT BUILDER
The Fund's top 10 holdings and portfolio diversification vary with changes in
portfolio investments. See the Statement of Investments for a complete list of
the Fund's holdings.
11
COLUMBIA ACORN USA
>In a Nutshell
[Photo of Robert A. Mohn]
Columbia Acorn USA strongly outperformed in the second quarter, up 4.55% (Class
A shares, without sales charge) vs. a 0.47% gain for the Russell 2000. The Fund
was also ahead year-to-date as of June 30, 2004, up 9.64% for the six months vs.
a 6.76% gain for the Russell 2000.
Good calls in the energy and telecom sectors contributed to the Fund's
outperformance. Our energy analyst, Jason Selch, believed energy stock prices
were lagging behind increases in oil prices. We added to the Fund's energy
weighting at the beginning of the year and it paid off as the sector rallied in
the first half of 2004. Quicksilver, a company that does coal seam gas drilling
in the Midwest, was up more than 107% for the six months and 73% in the quarter.
Western Gas, another coal seam gas producer, was up 38% year-to-date and up 28%
for the quarter.
We believe the Fund's outperformance in telecom was a testament to Columbia
Wanger's niche stock-picking talent. While the telecom component of the Russell
2000 was the worst performing sector in the index (down 2% for the quarter), our
telecom portion in Columbia Acorn USA was up 17%. We mentioned the growth of
Western Wireless and Crown Castle International in our first quarter report.
Both stocks showed continued strength in the second quarter. Western Wireless
was up 24% in the quarter and had a six-month gain of over 57%. Crown Castle was
up 17% for the quarter and 34% year-to-date. Regional phone company Commonwealth
Telephone was another telecom winner. The stock was up 9% for the quarter and
19% year-to-date.
Health care hurt performance. PPO network First Health was down 29% for the
second quarter and off 20% year-to-date. Competitor pricing pressure dampened
first quarter revenues. The company continued to generate a lot of cash--cash
they have been using to buy back stock. We believe they are doing the right
things in a tough environment. Par Pharmaceuticals, a generic drug manufacturer
recently added to the Fund, missed its first quarter earnings and suffered from
investor fears that the generics industry is becoming too competitive. We bought
the stock because we like the way the company is run and expect recent R&D
investments to begin paying off in 2005. Another new addition, Atherogenics, is
developing a promising product to treat cardiovascular disease but investors
fear unknowns that could come out in data to be released in the third quarter.
We are willing to accept the risk if the payoff is high enough. In this case, we
believe it could be.
We have been tweaking our stock emphasis to try and capture market
opportunities. In the financial sector, for example, we have shifted into banks
that we believe may benefit if short rates rise. We're also trying to focus more
on commercial banks over retail banks. In the health care sector, we believe
there are opportunities in select companies that have not participated in the
recent bull market. Short-term problems are making the outlook for these
companies somewhat unclear but the fog could be masking sunny days ahead.
/s/ Robert A. Mohn
Robert A. Mohn
LEAD PORTFOLIO MANAGER
ESCO'S TRIPLE PLAY
- --------------------------------------------------------------------------------
Esco Technologies manufactures filtration, communications and radio frequency
shielding/testing equipment. Filtration is an attractive "razor blade" industry.
Filters ("blades") generate higher profits than the original equipment
("razors") and generally have to be replaced on a regular basis, providing a
predictable revenue stream. The communications segment's largest and highest
growth product is its two-way automatic communications system. This system
enables utilities to remotely read meters by transmitting data over existing
electrical power lines and also allows for electrical grid load monitoring and
control. The radio frequency shielding segment of Esco's business makes products
that measure or contain electromagnetic emissions. This segment serves the
health care, electronics and transportation industries and has a leading share
of the market. For the first half of 2004, Esco's stock was up 22%. We like the
company's long-term prospects given its future growth potential, strong cash
flow, solid balance sheet and reasonable valuation.
INVESTMENTS IN SMALL-CAP COMPANIES MAY BE SUBJECT TO GREATER VOLATILITY AND
PRICE FLUCTUATIONS BECAUSE THEY MAY BE THINLY TRADED AND LESS LIQUID THAN
INVESTMENTS IN LARGER COMPANIES.
AS OF 6/30/04, THE FUND'S POSITIONS IN THE HOLDINGS MENTIONED WERE: QUICKSILVER,
2.7%; WESTERN GAS, 1.2%; WESTERN WIRELESS, 3.5%; CROWN CASTLE INTERNATIONAL,
1.9%; COMMONWEALTH TELEPHONE, 1.9%; FIRST HEALTH, 1.5%; PAR PHARMACEUTICALS,
0.9%; ATHEROGENICS, 0.6%; ESCO TECHNOLOGIES, 2.0%.
12
1-800-922-6769
COLUMBIA ACORN USA
>At a Glance TICKER SYMBOL: LAUAX
TOTAL NET ASSETS: $767.9 MILLION
PRETAX AND AFTER-TAX AVERAGE ANNUAL TOTAL RETURNS (BASED ON CLASS A SHARE
RETURNS)
>through June 30, 2004
YEAR TO LIFE OF
DATE* 1 YEAR 3 YEARS FUND
----- ------ ------- ----
Returns before NAV 9.64% 34.00% 7.01% 14.61%
taxes POP 3.34 26.30 4.92 12.79
- --------------------------------------------------------------------------
Returns after taxes NAV 9.64 34.00 6.94 14.55
on distributions POP 3.34 26.30 4.85 12.73
- --------------------------------------------------------------------------
Returns after taxes NAV 6.27 22.10 5.99 12.70
on distributions and POP 2.17 17.09 4.18 11.09
sale of fund shares
- --------------------------------------------------------------------------
Russell 2000 (pretax) 6.76 33.37 6.24 7.19
Past performance, before and after taxes, cannot predict future investment
results. After-tax returns are calculated using the highest historical
individual federal marginal income tax rates, and do not reflect the impact of
state and local taxes. Returns after taxes on distributions and sale of fund
shares reflect the additional tax impact of long-term gains or losses realized
when fund shares are sold. The returns are taxed at the maximum rate and assume
shares were purchased at the beginning of the period. Actual after-tax returns
depend on the investor's tax situation and may differ from those shown.
After-tax returns are not relevant to investors who hold their fund shares
through tax-deferred arrangements such as 401(k) plans or individual retirement
accounts. After-tax returns are shown for Class A shares only; after-tax returns
for other share classes will vary. Indexes do not reflect any deduction for
fees, expenses or taxes.
Investment returns and principal value may fluctuate, resulting in a gain or
loss on sale. PUBLIC OFFERING PRICE (POP) RETURNS INCLUDE THE MAXIMUM SALES
CHARGE OF 5.75% FOR CLASS A SHARES. NET ASSET VALUE (NAV) RETURNS DO NOT INCLUDE
SALES CHARGES OR CONTINGENT DEFERRED SALES CHARGES (CDSC).
*Year to date data not annualized.
COLUMBIA ACORN USA PORTFOLIO DIVERSIFICATION
>as a % of net assets, as of June 30, 2004
Consumer 15.4%
Goods/Services
Health Care 15.1%
Other* 8.8%
Energy/Minerals 10.3%
Finance 9.8%
Industrial 6.7%
Goods/Services
Information 33.9%
Software/Services 14.8%
Telecommunications 9.1%
Computer Related Hardware 6.7%
Media 3.3%
*Other includes cash and other assets less liabilities of 8.0%.
THE VALUE OF A $10,000 INVESTMENT IN COLUMBIA ACORN USA
>October 16, 2000 through June 30, 2004
Illustration is based on a hypothetical $10,000 investment from inception in
Class A shares of the Fund, which includes the 5.75% maximum initial sales
charge. Performance may reflect any voluntary waiver or reimbursement of Fund
expenses by the Advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower. The Russell 2000 is a
market-weighted index of 2,000 smaller U.S. companies formed by taking the
largest 3,000 U.S. companies and eliminating the largest 1,000. The index is
unmanaged and returns for both the index and the Fund include reinvested
dividends and capital gains. It is not possible to invest directly in an index.
PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND
PRINCIPAL VALUE OF AN INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT FUND SHARES,
WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. PERFORMANCE
CHANGES OVER TIME. VISIT COLUMBIAFUNDS.COM FOR DAILY UPDATES.
[MOUNTAIN CHART]
WITHOUT CLASS A CLASS B CLASS C
SALES CHARGE $16,589 $16,198 $16,213
- ------------------------------------------------
WITH
SALES CHARGE $15,635 $15,898 $16,213
COLUMBIA ACORN
COLUMBIA ACORN USA - A WITH
USA - A AT NAV SALES CHARGE RUSSELL 2000
-------------- ------------ ------------
10/16/00 10000.00 9425.00 10000.00
10/31/00 10412.00 9813.31 10363.90
9804.98 9241.19 9300.03
12/31/00 10759.00 10140.40 10098.70
11439.00 10781.20 10624.50
11402.40 10746.70 9927.40
3/31/01 11134.40 10494.20 9441.79
12479.50 11761.90 10180.40
13173.30 12415.80 10430.60
6/30/01 13534.30 12756.00 10790.80
13671.00 12884.90 10206.70
13288.20 12524.10 9877.05
9/30/01 11365.40 10711.90 8547.48
11393.80 10738.60 9047.68
12059.20 11365.80 9748.12
12/31/01 12764.60 12030.70 10349.80
12910.20 12167.80 10242.20
12464.80 11748.00 9961.45
3/31/02 13521.80 12744.30 10762.10
13719.20 12930.30 10860.20
12938.60 12194.60 10378.20
6/30/02 12158.40 11459.30 9863.22
10495.10 9891.64 8373.58
10334.50 9740.29 8352.25
9/30/02 9561.51 9011.72 7752.44
10013.80 9437.97 8001.00
10882.00 10256.20 8715.04
12/31/02 10342.20 9747.54 8229.80
10181.90 9596.45 8002.02
10036.30 9459.22 7760.24
3/31/03 10058.40 9480.03 7860.16
11043.10 10408.10 8605.44
12188.30 11487.50 9528.92
6/30/03 12378.40 11666.60 9701.36
12955.20 12210.30 10308.40
13662.60 12877.00 10781.00
9/30/03 13341.50 12574.40 10582.00
14705.00 13859.50 11470.60
15018.20 14154.70 11877.70
12/31/03 15127.90 14258.00 12118.70
15908.50 14993.80 12645.20
15981.70 15062.70 12758.50
3/31/04 15865.00 14952.80 12877.50
15471.50 14581.90 12220.90
16076.50 15152.10 12415.40
6/30/04 16588.60 15634.80 12938.30
COLUMBIA ACORN USA TOP 10 HOLDINGS (AS A % OF NET ASSETS)
1. Western Wireless 3.5%
RURAL CELLULAR PHONE SERVICES
2. AmeriCredit 2.8%
AUTO LENDING
3. Quicksilver 2.7%
NATURAL GAS & COAL SEAM GAS PRODUCER
4. Edwards Lifesciences 2.6%
HEART VALVES
5. ITT Educational Services 2.0%
TECHNOLOGY-ORIENTED POST SECONDARY
DEGREE PROGRAMS
6. Esco Technologies 2.0%
FILTRATION & TEST EQUIPMENT
7. Commonwealth Telephone 1.9%
RURAL PHONE FRANCHISES & CLEC
8. Crown Castle International 1.9%
COMMUNICATION TOWERS IN USA & UK
9. Zebra Technologies 1.9%
BAR CODE PRINTERS
10. HCC Insurance Holdings 1.9%
AVIATION INSURANCE
The Fund's top 10 holdings and portfolio diversification vary with changes in
portfolio investments. See the Statement of Investments for a complete list of
the Fund's holdings.
13
COLUMBIA ACORN INTERNATIONAL SELECT
>In a Nutshell
[Photo of Todd M. Narter] [Photo of Christopher J. Olson]
Columbia Acorn International Select rose 0.57% (Class A shares, without sales
charge) in the second quarter. By comparison, the Citigroup World ex-US Cap
Range $2-10B Index was down 1.23%. In the first half of the year, the Fund was
up 7.46%, outperforming the Citigroup World ex-US Cap Range $2-10B Index return
of 7.29%.
Big dollar winners for the quarter included Neopost, a French company that
makes postage meters. The company was up 10% for the quarter and 18% for the
half on solid results and continued growth. Talisman Energy, a Canadian oil and
gas producer, was up 11% in the quarter and 15% for the six months due to higher
oil prices and subsequent improvements in margins and profitability. Japan's
Hoya, a maker of eyeglass lenses and opto-electrical components, finished the
quarter up 8% and up 16% for the half.
Jardine Lloyd Thompson Group in the United Kingdom was the Fund's biggest
dollar loser this quarter. The company is an insurance broker offering marine,
aviation, property and casualty insurance. Shares dropped 20% in the quarter due
to the weaker dollar and the softer market for reinsurance this year. For the
six months, shares are down over 20%. Despite the recent weakness in the stock
price, management has continued to deliver good growth. With more than a 5%
dividend yield, attractive valuation and strong management, we feel that the
recent weakness may be overdone.
Other laggards to performance included Venture, an electronic manufacturing
services provider in Singapore, down 7% for the quarter and 9% for the six
months. Sinotrans, a Chinese logistics provider, was down 12% in the quarter and
24% for the half year. USS Co., a Japanese used car auctioneer, was down 9% for
the quarter but shares were up 7% for the six months. We sold the Fund's
positions in both Sinotrans and USS Co. during the quarter.
/s/ Todd M. Narter /s/ Christopher J. Olson
Todd M. Narter Christopher J. Olson
CO-PORTFOLIO MANAGER CO-PORTFOLIO MANAGER
A BRAND YOU'VE NEVER
- --------------------------------------------------------------------------------
HEARD OF
Funai Electric is a top-notch Japanese consumer electronics company and most
people do not know that it owns such recognizable brands as Sylvania, Emerson
and Symphonic. Funai Electric is a low-cost producer and has risen near the top
in all of its major product lines. Globally it is the fourth largest maker of
DVD players, second largest maker of VCR machines and the third largest maker of
TV sets. Funai Electric has the best operating margins of any consumer
electronics company in Japan but trades at a discount to its closest peers since
its name is not well known. We believe the market is bound to take notice and we
are hopeful that share price increases will follow. For the six months, the
shares were up 8%.
MID-CAP STOCKS TEND TO BE MORE VOLATILE AND MAY BE LESS LIQUID THAN THE STOCKS
OF LARGER COMPANIES. INVESTMENTS IN FOREIGN SECURITIES HAVE SPECIAL RISKS,
INCLUDING POLITICAL OR ECONOMIC INSTABILITY, HIGHER COSTS, DIFFERENT
REGULATIONS, ACCOUNTING STANDARDS, TRADING PRACTICES AND LEVELS OF INFORMATION,
AND CURRENCY EXCHANGE RATE FLUCTUATIONS.
AS OF 6/30/04, THE FUND'S POSITIONS IN THE HOLDINGS MENTIONED WERE: NEOPOST,
3.3%; TALISMAN ENERGY, 2.5%; HOYA, 2.9%; JARDINE LLOYD THOMPSON GROUP, 1.7%;
VENTURE, 2.0%; SINOTRANS, 0.0%; USS CO., 0.0%; FUNAI ELECTRIC, 3.3%.
14
1-800-922-6769
COLUMBIA ACORN INTERNATIONAL SELECT TICKER SYMBOL: LAFAX
>At a Glance TOTAL NET ASSETS: $44.7 MILLION
PRETAX AND AFTER-TAX AVERAGE ANNUAL TOTAL RETURNS (BASED ON CLASS A SHARE
RETURNS)
>through June 30, 2004
YEAR TO LIFE OF
DATE* 1 YEAR 3 YEARS FUND
----- ------ ------- -------
Returns before NAV 7.46% 38.03% 4.65% -3.31%
taxes POP 1.28 30.09 2.60 -4.84
- -----------------------------------------------------------------------------
Returns after taxes NAV 7.39 38.12 4.67 -3.33
on distributions POP 1.22 30.18 2.62 -4.86
- -----------------------------------------------------------------------------
Returns after taxes NAV 4.85 24.89 4.01 -2.79
on distributions and POP 0.83 19.72 2.25 -4.06
sale of fund shares
- -----------------------------------------------------------------------------
Citigroup World 7.29 42.32 10.36 6.71
ex-US Cap Range
$2-10B (pretax)
Past performance, before and after taxes, cannot predict future investment
results. After-tax returns are calculated using the highest historical
individual federal marginal income tax rates, and do not reflect the impact of
state and local taxes. Returns after taxes on distributions and sale of fund
shares reflect the additional tax impact of long-term gains or losses realized
when fund shares are sold. The returns are taxed at the maximum rate and assume
shares were purchased at the beginning of the period. Actual after-tax returns
depend on the investor's tax situation and may differ from those shown.
After-tax returns are not relevant to investors who hold their fund shares
through tax-deferred arrangements such as 401(k) plans or individual retirement
accounts. After-tax returns are shown for Class A shares only; after-tax returns
for other share classes will vary. The return after taxes on distributions may
be higher than the return before taxes due to qualified foreign tax credits.
Indexes do not reflect any deduction for fees, expenses or taxes.
Investment returns and principal value may fluctuate, resulting in a gain or
loss on sale. PUBLIC OFFERING PRICE (POP) RETURNS INCLUDE THE MAXIMUM SALES
CHARGE OF 5.75% FOR CLASS A SHARES. NET ASSET VALUE (NAV) RETURNS DO NOT INCLUDE
SALES CHARGES OR CONTINGENT DEFERRED SALES CHARGES (CDSC).
*Year to date data not annualized.
COLUMBIA ACORN INTERNATIONAL SELECT PORTFOLIO DIVERSIFICATION
>as a % of net assets, as of June 30, 2004
[PIE CHART]
Consumer 24.0%
Goods/Services
Finance 16.6%
Other* 4.8%
Information Technology 10.3%
Energy/Minerals 9.2%
Health Care 7.6%
Industrial 27.5%
Goods/Services
*Other includes cash and other assets less liabilities of 3.2%.
THE VALUE OF A $10,000 INVESTMENT IN COLUMBIA ACORN INTERNATIONAL SELECT
>October 16, 2000 through June 30, 2004
Illustration is based on a hypothetical $10,000 investment from inception in
Class A shares of the Fund, which includes the 5.75% maximum initial sales
charge. Performance may reflect any voluntary waiver or reimbursement of Fund
expenses by the Advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower. Citigroup World ex-US
Cap Range $2-$10B is a subset of Citigroup's Broad Market Index, representing a
mid-cap developed market index excluding the U.S. The index is unmanaged and
returns for the index and Fund include reinvested dividends and capital gains.
It is not possible to invest directly in an index.
PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND
PRINCIPAL VALUE OF AN INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT FUND SHARES,
WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. PERFORMANCE
CHANGES OVER TIME. VISIT COLUMBIAFUNDS.COM FOR DAILY UPDATES.
[MOUNTAIN CHART]
WITHOUT CLASS A CLASS B CLASS C
SALES CHARGE $8,824 $8,592 $8,610
- ------------------------------------------------
WITH
SALES CHARGE $8,317 $8,336 $8,610
COLUMBIA ACORN COLUMBIA ACORN
INTERNATIONAL INTERNATIONAL CITIGROUP WORLD
SELECT - A AT SELECT - A WITH EX-US CAP
NAV SALES CHARGE RANGE $2-$10B
------------- ------------ -------------
10/16/00 10000.00 9425.00 10000.00
10/31/00 10344.00 9749.22 10000.00
9023.07 8504.24 9702.13
12/31/00 9683.56 9126.76 10175.70
9994.40 9419.72 10125.20
8848.04 8339.28 9757.43
3/31/01 7662.41 7221.82 8996.21
8063.15 7599.52 9660.39
8040.57 7578.24 9577.79
6/30/01 7699.65 7256.92 9328.63
7296.19 6876.66 9094.53
7142.97 6732.25 9012.07
9/30/01 5937.95 5596.52 7965.33
6313.23 5950.22 8285.25
6659.83 6276.89 8581.37
12/31/01 6858.96 6464.57 8599.89
6506.41 6132.29 8345.99
6427.03 6057.47 8473.08
3/31/02 6654.54 6271.91 8957.79
6858.84 6464.46 9121.86
6926.74 6528.45 9411.67
6/30/02 6710.63 6324.77 9084.98
5989.23 5644.85 8271.31
6097.04 5746.46 8251.71
9/30/02 5653.79 5328.69 7513.39
5642.48 5318.04 7647.55
5779.03 5446.73 8036.96
12/31/02 5818.90 5484.31 7810.46
5534.94 5216.68 7614.45
5301.92 4997.06 7472.01
3/31/03 5347.51 5040.03 7344.39
5847.51 5511.28 7993.41
6353.32 5988.00 8566.64
6/30/03 6393.34 6025.73 8811.00
6495.64 6122.14 9164.69
6774.30 6384.78 9693.06
9/30/03 7024.27 6620.37 10092.50
7546.88 7112.93 10871.80
7706.12 7263.01 10963.20
12/31/03 8211.64 7739.47 11688.00
8359.45 7878.78 11933.70
8717.23 8215.99 12220.80
3/31/04 8773.89 8269.39 12696.00
8592.27 8098.22 12263.90
8598.29 8103.89 12229.90
6/30/04 8824.37 8316.97 12727.00
COLUMBIA ACORN INTERNATIONAL SELECT TOP 10 HOLDINGS (AS A % OF NET ASSETS)
1. Anglo Irish Bank (Ireland) 5.7%
SMALL BUSINESS & MIDDLE MARKET BANKING
2. Exel (United Kingdom) 4.2%
GLOBAL LOGISTICS & FREIGHT FORWARDING
3. BG Group (United Kingdom) 3.7%
OIL & GAS PRODUCER
4. Neopost (France) 3.3%
POSTAGE METERS
5. Funai Electric (Japan) 3.3%
CONSUMER ELECTRONICS
6. Daito Trust Construction (Japan) 3.3%
APARTMENT BUILDER
7. Den Norske Bank (Norway) 3.2%
LARGEST NORWEGIAN BANK
8. Komercni Banka (Czech Republic) 3.0%
LEADING CZECH UNIVERSAL BANK
9. Sugi Pharmacy (Japan) 3.0%
DRUGSTORES
10. Hoya (Japan) 2.9%
OPTO-ELECTRICAL COMPONENTS & EYEGLASS LENSES
The Fund's top 10 holdings and portfolio diversification vary with changes in
portfolio investments. See the Statement of Investments for a complete list of
the Fund's holdings.
15
COLUMBIA ACORN SELECT
>In a Nutshell
[Photo of Ben Andrews]
Columbia Acorn Select increased 1.79% (Class A shares, without sales charge) for
the quarter, outperforming the S&P MidCap 400's 0.97% gain and the S&P 500's
1.72% return. Year-to-date through June 30, 2004, Columbia Acorn Select is up
7.16% vs. a 6.08% gain for the S&P MidCap 400 and a 3.44% gain for the S&P 500.
The quarter's winners included Expeditors International, Safeway and ITT
Educational Services, all up between 22% and 25%. Each of these companies
reported strong first quarter results and we are bullish on future outlooks.
Year-to-date through June 30, the Fund's performance drivers were
Harley-Davidson, ITT Educational Services, and Abercrombie and Fitch, which were
each up between 31% to 60% and added a combined $35 million profit to the Fund's
portfolio.
The biggest loser during the quarter and the six months was First Health.
Weak demand for the company's managed-care programs, coupled with enhanced
nationwide PPO offerings by many of its competitors, sent the stock down 20% in
the first half of the year. We believe that First Health's network and new
program offerings have a competitive advantage and should help the company gain
share in the corporate market.
We added two new names to the Fund's portfolio during the quarter:
Skillsoft Publishing, an Internet-delivered software training company, and
Tellabs, a manufacturer of telecom hardware. During the last three years of
dismal telecom capital spending, Tellabs made inroads into new markets, such as
data switching and fiber to residential users, while preserving its dominant
market share in digital transport. We believe that cable and telephone companies
worldwide will push to offer value-added services to their customers and Tellabs
will be a beneficiary.
As your new portfolio manager (as of March 11, 2004), I would like to
assure you that my sole focus is to continue to deliver competitive performance.
I am backed by the same analyst team, following the same investment process, to
pursue the same investment objective, as the previous manager. This investment
process has existed within Columbia Acorn's family for more than three decades
and I intend to honor the process.
/s/ Ben Andrews
Ben Andrews
LEAD PORTFOLIO MANAGER
FRESHENING THE BUSINESS
- --------------------------------------------------------------------------------
Once a darling of Wall Street, grocery retailer Safeway has fallen from grace.
The culprits: botched acquisitions, elevated labor and health care costs and
increased competition. These factors have reduced the company's stock price by
65% from its early 2001 peak, but there just might be light at the end of the
tunnel. Management has begun to clean up the company's acquisitions. Two-tier
wage contracts in many of its markets and workers compensation reforms in
California will improve labor expenses over time. Marketing programs touting the
stores' freshness and quality are starting to improve store sales. In time, we
believe these results should improve sales and margins, which could lead to an
increase in Safeway's stock price.
COLUMBIA ACORN SELECT IS A NON-DIVERSIFIED FUND. THE PERFORMANCE OF EACH OF ITS
HOLDINGS WILL HAVE A GREATER IMPACT ON THE FUND'S TOTAL RETURN, AND MAY MAKE THE
FUND'S RETURNS MORE VOLATILE THAN A MORE DIVERSIFIED FUND. MID-CAP STOCKS TEND
TO BE MORE VOLATILE AND MAY BE LESS LIQUID THAN THE STOCKS OF LARGER COMPANIES.
AS OF 6/30/04, THE FUND'S POSITIONS IN THE HOLDINGS MENTIONED WERE: EXPEDITORS
INTERNATIONAL, 3.1%; SAFEWAY, 3.8%; HARLEY-DAVIDSON, 6.3%; ITT EDUCATIONAL
SERVICES, 4.8%; ABERCROMBIE AND FITCH, 3.4%; FIRST HEALTH, 4.3%; SKILLSOFT
PUBLISHING, 1.6%; TELLABS, 3.0%.
16
1-800-922-6769
COLUMBIA ACORN SELECT
>At a Glance TICKER SYMBOL: LTFAX
TOTAL NET ASSETS: $989.0 MILLION
PRETAX AND AFTER-TAX AVERAGE ANNUAL TOTAL RETURNS (BASED ON CLASS A SHARE
RETURNS)
>through June 30, 2004
YEAR TO LIFE OF
DATE* 1 YEAR 3 YEARS FUND
----- ------ ------- -------
Returns before NAV 7.16% 19.81% 9.98% 10.80%
taxes POP 1.00 12.93 7.83 9.05
- -----------------------------------------------------------------------------
Returns after taxes NAV 7.16 19.69 9.93 10.68
on distributions POP 1.00 12.81 7.78 8.93
- -----------------------------------------------------------------------------
Returns after taxes NAV 4.66 12.95 8.58 9.31
on distributions and POP 0.65 8.47 6.71 7.77
sale of fund shares
- -----------------------------------------------------------------------------
S&P MidCap 6.08 27.98 6.58 6.50
400 (pretax)
Past performance, before and after taxes, cannot predict future investment
results. After-tax returns are calculated using the highest historical
individual federal marginal income tax rates, and do not reflect the impact of
state and local taxes. Returns after taxes on distributions and sale of fund
shares reflect the additional tax impact of long-term gains or losses realized
when fund shares are sold. The returns are taxed at the maximum rate and assume
shares were purchased at the beginning of the period. Actual after-tax returns
depend on the investor's tax situation and may differ from those shown.
After-tax returns are not relevant to investors who hold their fund shares
through tax-deferred arrangements such as 401(k) plans or individual retirement
accounts. After-tax returns are shown for Class A shares only; after-tax returns
for other share classes will vary. Indexes do not reflect any deduction for
fees, expenses or taxes.
Investment returns and principal value may fluctuate, resulting in a gain or
loss on sale. PUBLIC OFFERING PRICE (POP) RETURNS INCLUDE THE MAXIMUM SALES
CHARGE OF 5.75% FOR CLASS A SHARES. NET ASSET VALUE (NAV) RETURNS DO NOT INCLUDE
SALES CHARGES OR CONTINGENT DEFERRED SALES CHARGES (CDSC).
*Year to date data not annualized.
COLUMBIA ACORN SELECT PORTFOLIO DIVERSIFICATION
> as a % of net assets, as of June 30, 2004
Consumer 32.8%
Goods/Services
Finance 13.5%
Health Care 7.1%
Industrial Goods/Services 3.1%
Other* 9.5%
Information 34.0%
*Cash and other assets less liabilities.
THE VALUE OF A $10,000 INVESTMENT IN COLUMBIA ACORN SELECT
>October 16, 2000 through June 30, 2004
Illustration is based on a hypothetical $10,000 investment from inception in
Class A shares of the Fund, which includes the 5.75% maximum initial sales
charge. Performance may reflect any voluntary waiver or reimbursement of Fund
expenses by the Advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower. The S&P MidCap 400 is a
broad, market-weighted index of 400 stocks that are in the next size/tier down
from the S&P 500. The index is unmanaged and returns for the index and the Fund
include reinvested dividends and capital gains. It is not possible to invest
directly in an index.
PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND
PRINCIPAL VALUE OF AN INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT FUND SHARES,
WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. PERFORMANCE
CHANGES OVER TIME. VISIT COLUMBIAFUNDS.COM FOR DAILY UPDATES.
[MOUNTAIN CHART]
WITHOUT CLASS A CLASS B CLASS C
SALES CHARGE $14,636 $14,289 $14,289
- ------------------------------------------------
WITH
SALES CHARGE $13,794 $13,989 $14,289
COLUMBIA ACORN COLUMBIA ACORN
SELECT - A AT SELECT - A WITH S&P
NAV SALES CHARGE MIDCAP 400
-------------- --------------- ----------
10/16/00 10000.00 9425.00 10000.00
10/31/00 10958.00 10327.90 10000.00
11/30/00 9893.98 9325.07 9245.17
12/31/00 10632.10 10020.70 9952.44
10940.40 10311.30 10174.10
10300.40 9708.11 9593.48
3/31/01 9893.52 9324.64 8880.22
10608.80 9998.81 9859.85
11188.10 10544.80 10089.50
6/30/01 11000.10 10367.60 10048.70
10894.50 10268.10 9899.05
10382.50 9785.47 9575.28
9/30/01 9742.90 9182.69 8384.23
9946.53 9374.60 8755.11
10978.00 10346.80 9406.40
12/31/01 11445.60 10787.50 9892.33
11219.00 10573.90 9840.95
10977.80 10346.60 9853.06
3/31/02 11355.50 10702.50 10557.40
10736.60 10119.20 10508.00
11038.30 10403.60 10330.80
6/30/02 10849.50 10225.70 9574.68
10162.80 9578.39 8647.22
10404.60 9806.35 8690.72
9/30/02 9921.85 9351.34 7990.55
10465.60 9863.79 8336.79
10985.70 10354.00 8819.12
12/31/02 10510.00 9905.69 8456.70
10464.80 9863.10 8209.56
10479.50 9876.91 8014.06
3/31/03 10691.20 10076.40 8081.61
11302.70 10652.80 8668.36
11906.30 11221.60 9386.74
6/30/03 12215.80 11513.40 9506.39
12797.30 12061.50 9843.70
13325.80 12559.60 10290.20
9/30/03 13031.30 12282.00 10132.70
13507.00 12730.30 10898.80
13401.60 12631.00 11278.50
12/31/03 13658.90 12873.50 11468.90
14030.50 13223.70 11717.40
14386.80 13559.60 11998.80
3/31/04 14379.60 13552.80 12049.70
13955.40 13153.00 11654.20
14182.90 13367.40 11896.00
6/30/04 14635.50 13794.00 12632.00
COLUMBIA ACORN SELECT TOP 10 HOLDINGS (AS A % OF NET ASSETS)
1. Harley-Davidson 6.3%
MOTORCYCLES & RELATED MERCHANDISE
2. TCF Financial 5.8%
GREAT LAKES BANK
3. McAfee 5.0%
SECURITY SOFTWARE & SERVICES
4. ITT Educational Services 4.8%
TECHNOLOGY-ORIENTED POST SECONDARY
DEGREE PROGRAMS
5. First Health 4.3%
PPO NETWORK
6. PeopleSoft 4.0%
HR, ERP, CRM & SUPPLY CHAIN SOFTWARE
7. Safeway 3.8%
RETAIL FOOD & DRUG STORES
8. Interpublic Group 3.8%
ADVERTISING
9. Synopsys 3.7%
SOFTWARE FOR DESIGNING SEMICONDUCTOR CHIPS
10. Tektronix 3.4%
ANALYTICAL INSTRUMENTS
The Fund's top 10 holdings and portfolio diversification vary with changes in
portfolio investments. See the Statement of Investments for a complete list of
the Fund's holdings.
17
COLUMBIA THERMOSTAT FUND
>In a Nutshell
[Photo of Ralph Wanger] [Photo of Charles P. McQuaid]
Columbia Thermostat Fund was down 0.18% (Class A shares, without sales charge)
for the quarter but ended the six months up 2.66%. These returns were in line
with the Lipper Flexible Portfolio Funds Index. As expected, Fund performance
was in between the S&P 500 and the Lehman Brothers U.S. Credit Intermediate Bond
Index (see Page 4 for index results).
The first six months of 2004 favored our small-, mid- and value-stock funds
in the portfolio. Columbia Mid Cap Value Fund, Columbia Acorn Fund, and Columbia
Acorn Select were each up over 7.40% for the six-month period. Overall,
Thermostat's equity portfolio had a 4.61% return year-to-date and the fixed
income piece was up 0.17%. During the second quarter, the equity portion of the
portfolio had a 1.37% gain vs. a 2.27% drop on the income side.
As noted in the table below, the Fund hit three reallocation triggers
during the second quarter. We increased bond exposure in the portfolio in April
and June and increased stock fund exposure in May.
Assets in Columbia Thermostat Fund were just over $183 million at the end
of the period. We believe this is a good result for a fund that is less than two
years old. We are pleased with the steady inflows of money and appreciate your
investment. We will continue to strive to keep Fund results at an even
temperature despite ongoing market volatility.
/s/ Ralph Wanger /s/ Charles P. McQuaid
Ralph Wanger Charles P. McQuaid
CO-PORTFOLIO MANAGER CO-PORTFOLIO MANAGER
RESULTS OF THE FUNDS OWNED IN
COLUMBIA THERMOSTAT FUND
Equities
2ND SIX-MONTH
WEIGHTING QUARTER RETURNS TO
FUND IN FUND RETURNS 6/30/04
----------------------------------------------------
Columbia 20% 1.65% 8.99%
Acorn Fund
----------------------------------------------------
Columbia 15% 1.93% 7.42%
Acorn Select
---------------------------------------------------
Columbia Growth 25% 1.01% -2.17%
Stock Fund
----------------------------------------------------
Columbia Growth 25% 0.42% 4.26%
& Income Fund
----------------------------------------------------
Columbia Mid Cap 15% 2.64% 7.86%
Value Fund
----------------------------------------------------
WEIGHTED AVERAGE 100% 1.37%* 4.61%*
----------------------------------------------------
*WEIGHTED AVERAGE RETURN OF EQUITY FUNDS IN THE PORTFOLIO.
Fixed Income
2ND SIX-MONTH
WEIGHTING QUARTER RETURNS TO
FUND IN FUND RETURNS 6/30/04
----------------------------------------------------
Columbia Federal 30% -2.37% 0.11%
Securities Fund
----------------------------------------------------
Columbia Intermediate 50% -2.35% 0.14%
Bond Fund
----------------------------------------------------
Columbia High 20% -1.91% 0.32%
Yield Fund
----------------------------------------------------
WEIGHTED AVERAGE 100% -2.27%* 0.17%*
----------------------------------------------------
*WEIGHTED AVERAGE RETURN FOR INCOME FUNDS IN THE PORTFOLIO.
COLUMBIA THERMOSTAT FUND
REBALANCING IN THE QUARTER
----------------------------------------------------
APRIL 22, 2004: 50% stock, 50% fixed income
MAY 21, 2004: 55% stock, 45% fixed income
JUNE 23, 2004: 50% stock, 50% fixed income
THE VALUE OF AN INVESTMENT IN THE FUND IS BASED PRIMARILY ON THE PERFORMANCE OF
THE UNDERLYING PORTFOLIO FUNDS AND THE ALLOCATION OF THE FUND'S ASSETS AMONG
THEM. AN INVESTMENT IN THE UNDERLYING FUNDS MAY PRESENT CERTAIN RISKS, INCLUDING
STOCK MARKET FLUCTUATIONS THAT OCCUR IN RESPONSE TO ECONOMIC AND BUSINESS
DEVELOPMENTS; AND A GREATER DEGREE OF SOCIAL, POLITICAL AND ECONOMIC VOLATILITY
ASSOCIATED WITH INTERNATIONAL INVESTING. INVESTING IN SMALL- AND MID-CAP STOCKS
MAY PRESENT SPECIAL RISKS INCLUDING POSSIBLE ILLIQUIDITY AND GREATER PRICE
VOLATILITY THAN STOCKS OF LARGER, MORE ESTABLISHED COMPANIES. CHANGES IN
INTEREST RATES AND CHANGES IN THE FINANCIAL STRENGTH OF ISSUERS OF LOWER-RATED
BONDS MAY ALSO AFFECT UNDERLYING FUND PERFORMANCE. THE FUND IS ALSO SUBJECT TO
THE RISK THAT THE INVESTMENT ADVISER'S DECISIONS REGARDING ASSET CLASSES AND
PORTFOLIO FUNDS WILL NOT ANTICIPATE MARKET TRENDS SUCCESSFULLY, RESULTING IN A
FAILURE TO PRESERVE CAPITAL OR LOWER TOTAL RETURN. IN ADDITION, THE FUND MAY BUY
AND SELL SHARES OF THE PORTFOLIO FUNDS FREQUENTLY. THIS MAY RESULT IN HIGHER
TRANSACTION COSTS AND ADDITIONAL TAX LIABILITY. THIS IS NOT AN OFFER OF THE
SHARES OF ANY OTHER MUTUAL FUND MENTIONED HEREIN.
18
1-800-922-6769
COLUMBIA THERMOSTAT FUND
>At a Glance TICKER SYMBOL: CTFAX
TOTAL NET ASSETS: $183.4 MILLION
PRETAX AND AFTER-TAX AVERAGE ANNUAL TOTAL RETURNS (BASED ON CLASS A SHARE
RETURNS)
>through June 30, 2004
YEAR TO LIFE OF
DATE* 1 YEAR FUND
------- ------ -------
Returns before taxes NAV 2.66% 12.58% 19.18%
POP -3.24 6.11 14.01
- ----------------------------------------------------------------------------
Returns after taxes NAV 2.62 12.20 18.86
on distributions POP -3.28 5.75 13.70
- ----------------------------------------------------------------------------
Returns after taxes NAV 1.74 8.23 16.21
on distributions and POP -2.10 4.02 11.78
sale of fund shares
- ----------------------------------------------------------------------------
S&P 500 (pretax) 3.44 19.11 27.84
- ----------------------------------------------------------------------------
Lehman U.S. Credit
Intermediate Bond -0.08 0.44 3.50
Index (pretax)
- ----------------------------------------------------------------------------
Lehman U.S. Govt.
Intermediate Bond -0.15 -0.48 0.91
Index (pretax)
- ----------------------------------------------------------------------------
Lipper Flexible Portfolio 2.25 14.64 21.23
Funds Index (pretax)
Past performance, before and after taxes, cannot predict future investment
results. After-tax returns are calculated using the highest historical
individual federal marginal income tax rates, and do not reflect the impact of
state and local taxes. Returns after taxes on distributions and sale of fund
shares reflect the additional tax impact of long-term gains or losses realized
when fund shares are sold. The returns are taxed at the maximum rate and assume
shares were purchased at the beginning of the period. Actual after-tax returns
depend on the investor's tax situation and may differ from those shown.
After-tax returns are not relevant to investors who hold their fund shares
through tax-deferred arrangements such as 401(k) plans or individual retirement
accounts. After-tax returns are shown for Class A shares only; after-tax returns
for other share classes will vary. Indexes do not reflect any deduction for
fees, expenses or taxes.
Investment returns and principal value may fluctuate, resulting in a gain or
loss on sale. PUBLIC OFFERING PRICE (POP) RETURNS INCLUDE THE MAXIMUM SALES
CHARGE OF 5.75% FOR CLASS A SHARES. NET ASSET VALUE (NAV) RETURNS DO NOT INCLUDE
SALES CHARGES OR CONTINGENT DEFERRED SALES CHARGES (CDSC).
*Year to date data not annualized.
PORTFOLIO WEIGHTINGS
>as a % of assets in each investment category, as of June 30, 2004
[PIE CHART]
STOCK MUTUAL FUND
Columbia Acorn Fund 20%
Columbia Acorn Select 15%
Columbia Growth Stock Fund 25%
Columbia Growth & Income Fund 25%
Columbia Mid Cap Value Fund 15%
[PIE CHART]
BOND MUTUAL FUNDS
Columbia Federal Securities Fund 30%
Columbia Intermediate Bond Fund 50%
Columbia High Yield Fund 20%
THE VALUE OF A $10,000 INVESTMENT IN COLUMBIA THERMOSTAT FUND
>March 3, 2003 through June 30, 2004
Illustration is based on a hypothetical $10,000 investment from inception in
Class A shares of the Fund, which includes the 5.75% maximum initial sales
charge. Performance may reflect any voluntary waiver or reimbursement of Fund
expenses by the Advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower. The S&P 500 is a broad,
market-weighted average of U.S. blue-chip company stock performance. The Lehman
U.S. Govt. Intermediate Bond Index is made up of 1 to 10 year treasury and
agency bonds, excluding targeted investor notes and state and local government
series bonds. The Lehman U.S. Credit Intermediate Bond Index is the intermediate
component of the U.S. Credit Index. The U.S. Credit Index includes publicly
issued U.S. corporate and foreign debentures and secured notes that meet
specified maturity, liquidity, and quality requirements. The indexes are
unmanaged and returns for the indexes and the Fund include reinvested dividends
and capital gains. It is not possible to invest directly in an index.
PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND
PRINCIPAL VALUE OF AN INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT FUND SHARES,
WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. PERFORMANCE
CHANGES OVER TIME. VISIT COLUMBIAFUNDS.COM FOR DAILY UPDATES.
[MOUNTAIN CHART]
WITHOUT CLASS A CLASS B CLASS C
SALES CHARGE $12,638 $12,514 $12,514
- ------------------------------------------------
WITH
SALES CHARGE $11,911 $12,114 $12,514
COLUMBIA THERMOSTAT LEHMAN U.S. CREDIT LEHMAN U.S.
COLUMBIA THERMOSTAT FUND - A INTERMEDIATE BOND GOVT. INTERMEDIATE
FUND - A AT NAV WITH SALES CHARGE S&P 500 INDEX BOND INDEX
--------------- ----------------- --------- ------------------ ------------------
3/3/03 10000.00 9425.00 10000.00 10000.00 10000.00
3/31/03 10089.00 9508.88 10097.10 10020.70 10002.10
10603.50 9993.84 10928.80 10158.30 10030.20
11078.60 10441.60 11504.60 10417.70 10187.70
6/30/03 11224.80 10579.40 11651.40 10423.30 10171.00
11284.30 10635.50 11856.80 10103.60 9923.81
11512.20 10850.30 12088.00 10134.20 9941.68
9/30/03 11482.30 10822.10 11959.70 10436.00 10157.20
11868.10 11185.70 12636.20 10343.10 10057.60
12007.00 11316.60 12747.40 10374.30 10058.50
12/31/03 12308.40 11600.60 13416.00 10477.20 10136.90
12478.20 11760.70 13662.20 10561.60 10191.90
12618.00 11892.40 13852.10 10678.60 10289.00
3/31/04 12658.30 11930.50 13643.10 10773.10 10360.60
12397.60 11684.70 13428.90 10498.20 10129.00
12437.20 11722.10 13613.20 10431.60 10096.60
6/30/04 12637.90 11911.20 13877.90 10469.20 10121.90
COLUMBIA THERMOSTAT FUND ASSET ALLOCATION
>as a % of net assets, as of June 30, 2004
[PIE CHART]
Stock Mutual Funds 49.7%
Bond Mutual Funds 49.8%
Cash and Other Assets Less Liabilities 0.5%
19
COLUMBIA ACORN FUND
>MAJOR PORTFOLIO CHANGES IN THE SECOND QUARTER (UNAUDITED)
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
ADDITIONS
- ----------------------------------------------------------------------------
INFORMATION
American Tower 1,500,000 1,750,000
ASE Test (Taiwan) 780,000 1,380,000
Autobytel 0 500,000
Bearing Point 3,100,000 3,350,000
Ceridian 0 1,000,000
Concurrent Computer 2,325,000 4,656,000
Crown Castle International 3,500,000 4,000,000
E.Piphany 5,700,000 6,700,000
Entravision Communications 301,000 1,000,000
Fair Isaac 0 530,000
Gestevis Telecino 0 75,000
Igate Capital 4,550,000 4,656,000
Insight Communications 1,700,000 2,700,000
Integrated Circuit Systems 1,195,000 1,315,000
Jabil Circuit 1,420,000 1,500,000
Liberty Media International 0 131,000
Novell 11,000,000 11,500,000
Pegasus Systems 1,125,000 1,250,000
Plexus 1,300,000 1,600,000
Radiant Systems 1,500,000 1,575,000
Semtech 800,000 850,000
SES Global (Luxembourg) 1,337,000 2,537,000
Shuffle Master 827,000 940,000
Tellabs 5,700,000 8,700,000
ValueClick 1,954,000 2,000,000
Venture (Singapore) 2,710,000 3,150,000
Western Wireless 2,800,000 3,000,000
- ----------------------------------------------------------------------------
CONSUMER GOODS/SERVICES
Alliance Gaming 2,010,000 2,750,000
Ann Taylor 795,000 863,000
(INCLUDES THE EFFECT OF A 3 FOR 2 STOCK SPLIT)
Brookstone 130,500 600,000
(INCLUDES THE EFFECT OF A 3 FOR 2 STOCK SPLIT)
Callaway Golf 0 500,000
Carter's 53,000 369,000
Columbia Sportswear 200,000 400,000
Global Bio-Chem Technology
Group (China) 14,730,000 30,000,000
Global Bio-Chem Technology
Group (Warrants) (China) 0 1,841,250
HNI 0 1,600,000
Masonite International (Canada) 440,000 550,000
Natura Cosmeticos (Brazil) 0 500,000
NBTY 0 850,000
Orbitz 0 750,000
Otsuke Kagu (Japan) 0 210,000
Pacific Brands (Australia) 0 5,000,000
Rank Group (United Kingdom) 0 230,700
RC2 425,000 545,000
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
- ----------------------------------------------------------------------------
CONSUMER GOODS/SERVICES (CONTINUED)
Sports Authority 0 773,000
Wacoal (Japan) 0 1,100,000
West Marine 0 823,000
Williams-Sonoma 607,000 1,400,000
- ----------------------------------------------------------------------------
INDUSTRIAL GOODS/SERVICES
Aalberts Industrie (Netherlands) 720,000 737,560
Aviall 300,000 600,000
Dominion Homes 0 290,000
Exel (United Kingdom) 1,800,000 2,600,000
Genlyte Group 0 300,000
Jaako Poyry (Finland) 0 185,000
Sika (Switzerland) 0 25,000
Tenaris (Argentina) 605,000 750,000
United Services Group
(Netherlands) 420,000 640,000
Vallourec (France) 66,000 95,000
Watts Water Technologies 543,000 554,000
Wienerberger (Austria) 700,000 787,500
- ----------------------------------------------------------------------------
FINANCE
Bank of the Ozarks 0 231,000
BOK Financial 1,524,000 1,638,000
CityBank Lynnwood 267,000 360,000
Credito Emiliano (Italy) 0 210,000
Cullen Frost Bankers 108,000 370,000
First Mutual Bancshares 76,000 125,000
Glacier Bancorp 1,917,500 2,187,000
(INCLUDES THE EFFECT OF A 5 FOR 4 STOCK SPLIT)
Great Southern Bancorp 348,000 455,000
(INCLUDES THE EFFECT OF A 2 FOR 1 STOCK SPLIT)
Imperial Thrift & Loan 0 74,000
Jardine Lloyd Thompson
(United Kingdom) 1,000,000 1,992,000
Komercni Banka (Czech Republic) 0 145,000
Northgate (United Kingdom) 0 784,000
Stewart Information Services 0 245,000
Texas Regional Bancshares 1,015,000 1,300,000
West Coast Bancorp 1,045,000 1,320,000
20
1-800-922-6769
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
ADDITIONS (CONTINUED)
- ----------------------------------------------------------------------------
HEALTH CARE
Accredo Health 0 450,000
Atherogenics 389,000 789,000
Bioveris 1,000,000 1,150,000
DOV Pharmaceuticals 0 1,165,000
Hogy Medical (Japan) 0 190,000
La Jolla Pharmaceutical 0 3,500,000
Lexicon Genetics 0 1,876,000
Ligand Pharmaceuticals 0 1,250,000
Myriad Genetics 160,000 460,000
Neurocrine Biosciences 0 360,000
NPS Pharmaceuticals 426,000 776,000
OPG Groep (Netherlands) 420,000 510,000
Par Pharmaceuticals 0 775,000
Pozen 0 1,709,000
- ----------------------------------------------------------------------------
ENERGY/MINERALS
Chicago Bridge & Iron 428,000 700,000
Clayton Williams Energy 0 400,000
Clayton Williams Energy -- 40,000
Esprit Exploration (Canada) 0 3,458,200
FMC Technologies 1,900,000 2,300,000
Fugro (Netherlands) 250,000 333,000
Gamesa (Spain) 570,000 1,470,000
McMoRan Exploration 875,000 915,000
Nexen (Canada) 800,000 925,000
Noranda (Canada) 500,000 700,000
Range Resources 0 916,000
Tullow Oil (United Kingdom) 10,000,000 15,400,000
Western Gas 2,600,000 2,800,000
(INCLUDES THE EFFECT OF A 2 FOR 1 STOCK SPLIT)
- ----------------------------------------------------------------------------
OTHER INDUSTRIES
Diamondrock Hospitality 0 1,000,000
Highland Hospitality 440,000 1,240,000
Northeast Utilities 1,350,000 1,650,000
Sponda (Finland) 875,000 1,352,600
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
SALES
- ----------------------------------------------------------------------------
INFORMATION
Agilysys 1,410,000 710,000
Alliance Atlantis Communication
(Canada) 750,000 500,000
American Management Systems 58,000 0
Aspect Communications 3,959,000 3,550,000
Avid Technology 1,800,000 1,600,000
Ciber 3,319,000 3,100,000
COMARCO 533,000 300,000
Commonwealth Telephone 900,000 800,000
Dionex 836,000 536,000
DoubleClick 2,000,000 1,400,000
Euronet Worldwide 406,000 286,000
Euronext (France) 725,000 0
Global Payments 1,487,000 1,457,000
Hit Entertainment
(United Kingdom) 2,750,000 0
International Game Technology 8,768,000 6,700,000
Kronos 1,900,000 1,625,000
Neopost (France) 431,900 371,900
Perot Systems 900,000 205,000
RH Donnelley 150,000 119,000
RSA Security 2,500,000 2,200,000
Salem Communications 850,000 770,000
Skillsoft Publishing 9,800,000 9,500,000
Tech Data 780,000 680,000
TVB (Hong Kong) 3,300,000 224,700
Varian 668,000 428,000
Witness Systems 1,660,000 1,500,000
- ----------------------------------------------------------------------------
CONSUMER GOODS/SERVICES
Borders Group 1,400,000 1,300,000
Furniture Brands International 510,000 0
Helen of Troy 2,200,000 1,381,000
Hon Industries 1,455,000 0
Jones Apparel 418,000 0
SCP Pool 1,511,000 1,326,000
Shimano (Japan) 800,000 644,100
USS (Japan) 260,000 135,000
Whole Foods Market 500,000 350,000
- ----------------------------------------------------------------------------
INDUSTRIAL GOODS/SERVICES
Expeditors International of
Washington 2,900,000 2,750,000
G&K Services 725,000 550,000
Hub Group 759,000 549,000
Insituform Technologies 500,000 0
Labor Ready 1,900,000 1,800,000
Munters (Sweden) 590,000 0
Northwest Pipe Company 120,000 0
21
COLUMBIA ACORN FUND
>MAJOR PORTFOLIO CHANGES IN THE SECOND QUARTER (UNAUDITED),
CONTINUED
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
SALES (CONTINUED)
- ----------------------------------------------------------------------------
FINANCE
Harleysville Group 200,000 0
Irish Life & Permanent (Ireland) 1,000,000 959,400
Republic 1,798,000 1,698,000
- ----------------------------------------------------------------------------
HEALTH CARE
Aclara Biosciences 1,982,000 0
Applera Celera Genomics 900,000 0
Enzon 1,665,000 0
Gene Logic 210,000 0
Guilford Pharmaceuticals 316,000 0
Incyte Genomics 320,000 0
Kinetic Concepts 276,000 0
Nektar Therapeutics 2,055,000 1,055,000
Novoste 1,273,000 0
Patheon (Canada) 422,000 0
Pharmacyclics 528,000 0
- ----------------------------------------------------------------------------
ENERGY/MINERALS
Aquila 1,270,000 0
Evergreen Resources 1,460,000 0
Quicksilver 600,000 465,000
Westport Resources 517,000 0
XTO Energy 7,875,000 7,275,000
- ----------------------------------------------------------------------------
OTHER INDUSTRIES
Airports of Thailand (Thailand) 1,250,600 0
Chelsea Properties Group 400,000 0
Federal Realty Investment Trust 690,000 575,000
General Growth Properties 1,845,000 1,320,000
LNR Property 80,000 0
Macerich Company 800,000 635,000
Mills 725,000 620,000
Red Electrica (Spain) 899,800 799,800
The Rouse Company 1,160,000 825,000
Security Capital European
Realty (Luxembourg) 299,275 194,827
Unisource Energy 800,000 0
22
1-800-922-6769
COLUMBIA ACORN FUND
>STATEMENT OF INVESTMENTS (UNAUDITED), JUNE 30, 2004
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
SECURITIES: 94.3%
- ----------------------------------------------------------------------------
INFORMATION: 24.9%
SOFTWARE/SERVICES
>BUSINESS SOFTWARE: 5.6%
11,500,000 Novell (b) $ 96,485
DIRECTORY, OPERATING SYSTEM & IDENTITY
MANAGEMENT SOFTWARE
1,600,000 Avid Technology (b)(c) 87,312
DIGITAL NONLINEAR EDITING SOFTWARE & SYSTEMS
1,625,000 Kronos (b)(c) 66,950
LABOR MANAGEMENT SOLUTIONS
3,450,000 PeopleSoft (b) 63,825
HR, ERP, CRM & SUPPLY CHAIN SOFTWARE
3,550,000 Aspect Communications (b) 50,410
CALL CENTER SOFTWARE
950,000 Micros Systems (b)(c) 45,571
INFORMATION SYSTEMS FOR RESTAURANTS & HOTELS
1,875,000 McAfee (b) 33,994
SECURITY SOFTWARE & SERVICES
6,700,000 E.Piphany (b)(c) 32,361
CRM SOFTWARE
2,200,000 JDA Software Group (b)(c) 28,974
APPLICATIONS/SOFTWARE & SERVICES FOR RETAILERS
2,035,000 MRO Software (b)(c) 27,696
ENTERPRISE MAINTENANCE SOFTWARE
1,521,000 Sybase (b) 27,378
DATABASE SOFTWARE
6,000,000 Actuate (b)(c) 23,700
INFORMATION DELIVERY SOFTWARE & SOLUTIONS
2,200,000 MAPICS (b)(c) 23,232
MID MARKET ERP SOFTWARE
3,000,000 Lawson Software (b) 21,240
ENTERPRISE RESOURCE PLANNING (ERP) SOFTWARE
1,500,000 Witness Systems (b)(c) 18,225
CUSTOMER EXPERIENCE MANAGEMENT SOFTWARE
5,600,000 Indus International (b)(c) 11,760
ENTERPRISE ASSET MANAGEMENT SOFTWARE
500,000 SPSS (b) 8,985
STATISTICAL/BUSINESS ANALYSIS SOFTWARE
1,575,000 Radiant Systems (b)(c) 7,387
POINT OF SALE SYSTEMS FOR CONVENIENCE STORES
750,000 Netegrity (b) 6,345
ENTERPRISE SECURITY SOFTWARE
3,300,000 BSQUARE (b)(c) 3,300
SOFTWARE TO HELP DESIGN MOBILE DEVICES
1,250,000 ClickSoftware Technologies (b) 2,875
SERVICE CHAIN OPTIMIZATION SOFTWARE
70,000 Group 1 Software (b) 1,606
ADDRESS VERIFICATION SOFTWARE
- ----------------------------------------------------------------------------
689,611
>BUSINESS INFORMATION/MARKETING
SERVICES/PUBLISHING: 1.7%
1,200,000 Getty Images (b) 72,000
PHOTOGRAPHS FOR PUBLICATIONS & ELECTRONIC MEDIA
1,336,000 Navigant Consulting (b) 28,644
CONSULTING FIRM
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
2,685,000 InfoUSA (b)(c) $ 27,226
BUSINESS DATA FOR SALES LEADS
1,000,000 Ceridian (b) 22,500
HR SERVICES & PAYMENT PROCESSING
530,000 Fair Isaac 17,691
CREDIT SCORING & DECISION ANALYTIC SOFTWARE
600,000 Information Holdings (b) 16,422
PATENT & OTHER BUSINESS INFORMATION
950,000 Administaff (b) 15,770
PROFESSIONAL EMPLOYER ORGANIZATION
119,000 RH Donnelley (b) 5,205
YELLOW PAGES PUBLISHER
1,700,000 PRIMEDIA (b) 4,726
SPECIALTY MAGAZINES & OTHER PUBLICATIONS
- ----------------------------------------------------------------------------
210,184
>INTERNET: 1.3%
9,500,000 Skillsoft Publishing (b)(c) 72,200
PROVIDER OF WEB-BASED LEARNING SOLUTIONS (E-LEARNING)
2,200,000 RSA Security (b) 45,034
ENTERPRISE SECURITY SOFTWARE
2,000,000 ValueClick (b) 23,960
INTERNET ADVERTISING
1,400,000 DoubleClick (b) 10,878
INTERNET ADVERTISING & DIRECT MARKETING STATISTICAL DATA
500,000 Autobytel (b) 4,540
AUTO WEBSITES FOR SALES LEADS & ADVERTISING
1,879,808 Vital Stream, Cl. C (b)(c) 1,410
STREAMING SERVICES FOR THE INTERNET
250,000 NeoPlanet, Series A (d) 51
53,376 NeoPlanet, Series B (d) 18
WEB BROWSER
- ----------------------------------------------------------------------------
158,091
>TRANSACTION PROCESSORS: 1.0%
1,457,000 Global Payments 65,594
CREDIT CARD PROCESSOR
1,250,000 Pegasus Systems (b)(c) 16,413
TRANSACTION PROCESSOR FOR HOTEL INDUSTRY
600,000 Cubic 12,558
REVENUE COLLECTION & DEFENSE SYSTEMS
5,000,000 Hong Kong Exchanges &
Clearing (Hong Kong) 10,308
TRADING, CLEARING & SETTLEMENT SERVICES FOR
FINANCIAL MARKETS
175,000 Deutsche Boerse (Germany) 8,910
TRADING, CLEARING & SETTLEMENT SERVICES
FOR FINANCIAL MARKETS
286,000 Euronet Worldwide (b) 6,615
ATM PROCESSOR
- ----------------------------------------------------------------------------
120,398
>COMPUTER SERVICES: 0.9%
3,350,000 Bearing Point (b) 29,714
BUSINESS CONSULTING & TECHNOLOGY STRATEGY
4,600,000 AnswerThink Consulting (b)(c) 26,358
IT INTEGRATOR FOR FORTUNE 2000
3,100,000 Ciber (b)(c) 25,482
SOFTWARE SERVICES & STAFFING
4,656,000 Igate Capital (b)(c) 18,531
TECHNOLOGY STAFFING SERVICES
23
COLUMBIA ACORN FUND
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>COMPUTER SERVICES--CONTINUED
2,300,000 Analysts International (b)(c) $ 7,084
TECHNOLOGY STAFFING SERVICES
1,025,000 New Horizons Worldwide (b)(c) 6,150
COMPUTER TRAINING SERVICES
205,000 Perot Systems (b) 2,720
BUSINESS CONSULTING & TECHNOLOGY STRATEGY
- ----------------------------------------------------------------------------
116,039
>ELECTRONICS DISTRIBUTION: 0.6%
1,695,000 Avnet (b) 38,476
ELECTRONIC COMPONENTS DISTRIBUTION
680,000 Tech Data (b) 26,608
I/T DISTRIBUTOR
710,000 Agilysys 9,791
I/T DISTRIBUTOR
- ----------------------------------------------------------------------------
74,875
>CONSUMER SOFTWARE: 0.5%
1,400,000 THQ (b) 32,060
ENTERTAINMENT SOFTWARE
1,125,000 Activision (b) 17,887
ENTERTAINMENT SOFTWARE
2,000,000 Pinnacle Systems (b) 14,300
VIDEO EDITING SOFTWARE & HARDWARE
- ----------------------------------------------------------------------------
64,247
COMPUTER RELATED HARDWARE
>COMPUTER HARDWARE/RELATED SYSTEMS: 2.5%
494,000 Zebra Technologies (b) 42,978
BAR CODE PRINTERS
2,500,000 Seachange International (b)(c) 42,200
SYSTEMS FOR VIDEO ON DEMAND & AD INSERTION
1,060,000 Avocent (b) 38,944
COMPUTER CONTROL SWITCHES
445,000 Rogers (b) 31,106
PCB LAMINATES & HIGH PERFORMANCE FOAMS
1,525,000 Unova (b) 30,881
BARCODE & WIRELESS LAN SYSTEMS
371,900 Neopost (France) 22,008
POSTAGE METERS
625,000 Excel Technologies (b)(c) 20,781
LASER SYSTEMS & ELECTRO-OPTICAL COMPONENTS
2,900,000 3Com (b) 18,125
NETWORKING EQUIPMENT
1,575,000 Cable Design Technologies (b)(c) 16,695
NETWORKING & SPECIALTY CABLES
535,000 II VI (b) 16,403
LASER COMPONENTS
1,350,000 CTS 16,281
ELECTRONIC COMPONENTS, SENSORS & EMS
4,656,000 Concurrent Computer (b)(c) 9,219
VIDEO ON DEMAND SYSTEMS & SERVICES
230,000 Applied Films (b) 6,675
THIN-FILM GLASS COATING EQUIPMENT
351,000 Phoenixtec Power (Taiwan) 346
UNINTERRUPTIBLE POWER SUPPLIES
- ----------------------------------------------------------------------------
312,642
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>GAMING EQUIPMENT: 2.4%
6,700,000 International Game Technology $ 258,620
SLOT MACHINES & PROGRESSIVE JACKPOTS
940,000 Shuffle Master (b) 34,131
CARD SHUFFLERS, CASINO GAMES & SLOT MACHINES
- ----------------------------------------------------------------------------
292,751
>INSTRUMENTATION: 1.2%
810,000 Mettler Toledo (b) 39,803
LABORATORY EQUIPMENT
1,350,000 Trimble Navigation (b) 37,517
GPS-BASED INSTRUMENTS
536,000 Dionex (b) 29,571
ION & LIQUID CHROMATOGRAPHY
2,300,000 Spectris (United Kingdom) 20,859
ELECTRONIC INSTRUMENTATION & CONTROLS
428,000 Varian (b) 18,040
ANALYTICAL INSTRUMENTS
- ----------------------------------------------------------------------------
145,790
>SEMICONDUCTORS/RELATED EQUIPMENT: 1.1%
1,315,000 Integrated Circuit Systems (b) 35,715
SILICON TIMING DEVICES
685,000 Littelfuse (b) 29,051
LITTLE FUSES
850,000 Semtech (b) 20,009
ANALOG SEMICONDUCTORS
1,380,000 Ase Test (Taiwan) (b) 10,171
SEMICONDUCTOR PACKAGING & TEST SERVICES
1,250,000 IXYS (b) 9,850
POWER SEMICONDUCTORS
565,000 Supertex (b) 9,232
MIXED-SIGNAL SEMICONDUCTORS
664,000 Asyst Technologies (b) 6,866
SEMICONDUCTOR FAB AUTOMATION EQUIPMENT
361,000 Actel (b) 6,678
FIELD PROGRAMMABLE GATE ARRAYS
604,000 Pericom Semiconductor (b) 6,469
SEMICONDUCTORS - INTERFACE INTEGRATED CIRCUITS
- ----------------------------------------------------------------------------
134,041
>CONTRACT MANUFACTURING: 0.8%
1,500,000 Jabil Circuit (b) 37,770
ELECTRONIC MANUFACTURING SERVICES
3,150,000 Venture (Singapore) 33,115
ELECTRONIC CONTRACT MANUFACTURER
1,600,000 Plexus (b) 21,600
ELECTRONIC MANUFACTURING SERVICES
- ----------------------------------------------------------------------------
92,485
TELECOMMUNICATIONS
>MOBILE COMMUNICATIONS: 1.7%
3,000,000 Western Wireless (b) 86,730
RURAL CELLULAR PHONE SERVICES
4,000,000 Crown Castle International (b) 59,000
COMMUNICATION TOWERS IN USA & UK
520,000 Telephone & Data Systems 37,024
CELLULAR & TELEPHONE SERVICES
1,750,000 American Tower (b) 26,600
COMMUNICATION TOWERS IN USA & MEXICO
24
1-800-922-6769
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>MOBILE COMMUNICATIONS--CONTINUED
300,000 COMARCO (b) $ 2,115
WIRELESS NETWORK TESTING
- ----------------------------------------------------------------------------
211,469
>TELECOMMUNICATION EQUIPMENT: 1.2%
8,700,000 Tellabs (b) 76,038
TELECOMMUNICATIONS & CABLE EQUIPMENT
830,000 Plantronics (b) 34,943
COMMUNICATION HEADSETS
1,600,000 Andrew (b) 32,016
WIRELESS INFRASTRUCTURE EQUIPMENT
1,200,000 Symmetricom (b) 10,680
NETWORK TIMING & SYNCHRONIZATION DEVICES
- ----------------------------------------------------------------------------
153,677
>TELECOMMUNICATIONS/WIRELINE
COMMUNICATIONS: 0.3%
800,000 Commonwealth Telephone (b) 35,816
RURAL PHONE FRANCHISES & CLEC
- ----------------------------------------------------------------------------
MEDIA
>TELEVISION PROGRAMMING/CATV: 1.0%
2,700,000 Insight Communications (b)(c) 25,002
CATV FRANCHISES IN MIDWEST
2,605,000 Liberty Media (b) 23,419
CATV PROGRAMMING & MEDIA COMPANY HOLDINGS
1,150,000 Corus Entertainment (Canada) 22,297
TELEVISION PROGRAMMING & RADIO STATIONS
2,500,000 Mediacom Communications (b) 19,550
CABLE TELEVISION FRANCHISES
2,379,000 United Global Com (b) 17,272
VIDEO, VOICE & DATA SERVICES OUTSIDE THE USA
500,000 Alliance Atlantis Communication
(Canada) (b) 9,317
CATV CHANNELS, TV/MOVIE
PRODUCTION/DISTRIBUTION
131,000 Liberty Media International (b) 4,860
CATV HOLDING COMPANY
- ----------------------------------------------------------------------------
121,717
>RADIO BROADCASTING: 0.6%
770,000 Salem Communications (b) 20,890
RADIO STATIONS FOR RELIGIOUS PROGRAMMING
1,200,000 Cumulus Media, Cl. A (b) 20,172
RADIO STATIONS IN SMALL CITIES
992,000 Saga Communications (b)(c) 18,104
RADIO STATIONS IN SMALL & MID-SIZED CITIES
1,200,000 Spanish Broadcasting (b) 11,172
SPANISH LANGUAGE RADIO STATIONS
- ----------------------------------------------------------------------------
70,338
>TV/SATELLITE BROADCASTING: 0.5%
2,537,000 SES Global (Luxembourg) 21,447
SATELLITE BROADCASTING SERVICES
1,400,000 Gray Television 19,446
MID MARKET AFFILIATED TV STATIONS
1,000,000 Entravision Communications (b) 7,680
SPANISH LANGUAGE TV, RADIO & OUTDOOR
270,000 Metropole TV (France) 7,633
TELEVISION BROADCASTER
200,000 Young Broadcasting (b) 2,630
TELEVISION STATIONS
NUMBER OF SHARES
OR PRINCIPAL AMOUNT (000) VALUE (000)
- ----------------------------------------------------------------------------
75,000 Gestevis Telecino (Spain) (b) $ 1,119
SPAIN'S SECOND LARGEST BROADCASTER
224,700 TVB (Hong Kong) 970
TELEVISION PROGRAMMING & BROADCASTING
- ----------------------------------------------------------------------------
60,925
-----------
INFORMATION: TOTAL 3,065,096
- ----------------------------------------------------------------------------
CONSUMER GOODS/SERVICES: 21.8%
SERVICES
>RETAIL: 6.6%
2,495,000 Chico's FAS (b) 112,674
WOMEN'S SPECIALTY RETAILER
1,600,000 Michaels Stores 88,000
CRAFT & HOBBY SPECIALTY RETAILER
3,743,000 Christopher & Banks (c) 66,288
WOMEN'S APPAREL RETAILER
2,265,000 Aeropostale (b) 60,951
MALL BASED TEEN RETAILER
788,000 Urban Outfitters (b) 47,997
ECLECTIC HOME & APPAREL RETAILER
1,400,000 Williams Sonoma (b) 46,144
HOME GOODS & FURNISHING RETAILER
5,100,000 Winn Dixie Stores 36,720
SUPERMARKETS IN THE SOUTHEAST US
895,000 Abercrombie & Fitch 34,681
TEEN APPAREL RETAILER
350,000 Whole Foods Market 33,408
NATURAL FOOD SUPERMARKETS
1,015,000 Petco Animal Supplies (b) 32,693
PET SUPPLIES & SERVICES
1,300,000 Borders Group 30,472
BOOKSTORES
1,072,000 Zale (b) 29,223
SPECIALTY RETAILER OF JEWELRY
1,370,000 Hot Topic (b) 28,071
MUSIC INSPIRED RETAILER OF APPAREL, ACCESSORIES
& GIFTS
773,000 Sports Authority (b) 27,751
SPORTING GOODS STORES
863,000 Ann Taylor (b) 25,010
WOMEN'S APPAREL RETAILER
823,000 West Marine (b) 22,098
LARGEST RETAILER OF BOATING SUPPLIES
700,000 Genesco (b) 16,541
MULTI-CONCEPT BRANDED FOOTWEAR RETAILER
200,000 Fast Retailing (Japan) 16,251
APPAREL RETAILER
1,700,000 Burberry Group (United Kingdom) 12,630
APPAREL RETAILER
600,000 Brookstone (b) 12,030
SPECIALTY CONSUMER PRODUCT RETAILER
2,250,000 Esprit Holdings (Hong Kong) (b) 10,117
GLOBAL APPAREL BRAND MANAGER
210,000 Otsuke Kagu (Japan) 6,556
FURNITURE RETAILER
950,000 Gaiam (b)(c) 6,441
HEALTHY LIVING CATALOG & E-COMMERCE
$ 6,000 Gadzooks 5% Convertible 10/07/08 (b)(d) 2,941
TEEN APPAREL RETAILER
- ----------------------------------------------------------------------------
805,688
25
COLUMBIA ACORN FUND
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>CONSUMER SERVICES: 1.6%
2,250,000 ITT Educational Services (b) $ 85,545
TECHNOLOGY-ORIENTED POST SECONDARY DEGREE
PROGRAMS
775,000 Weight Watchers (b) 30,334
WEIGHT LOSS PROGRAMS
1,290,000 Coinstar (b)(c) 28,341
OWNER/OPERATOR OF COIN COUNTING MACHINES
900,000 Central Parking 16,821
OWNER, OPERATOR & MANAGER OF PARKING LOTS &
GARAGES
1,750,000 Princeton Review (b)(c) 13,248
COLLEGE PREPARATION COURSES
2,350,000 Bally Total Fitness (b)(c) 11,750
NATIONAL CHAIN OF FITNESS CENTERS
135,000 USS (Japan) 11,615
USED CAR AUCTIONEER
- ----------------------------------------------------------------------------
197,654
>ENTERTAINMENT/LEISURE PRODUCTS: 1.5%
805,000 International Speedway Motors 39,155
LARGEST MOTORSPORT RACETRACK OWNER & OPERATOR
1,250,000 Leapfrog Enterprises (b) 24,862
EDUCATIONAL TOYS
2,765,000 Six Flags (b) 20,074
WORLDWIDE THEME PARK OPERATOR
545,000 RC2 (b) 19,348
COLLECTIBLES & TOYS
1,276,000 Action Performance (c) 19,229
MOTORSPORT COLLECTIBLES & MERCHANDISING
370,000 Amer Group (Finland) 19,281
BRANDED SPORTING GOODS
363,000 Speedway Motorsports 12,139
MOTORSPORT RACETRACK OWNER & OPERATOR
1,750,000 Magna Entertainment, Cl. A
(Canada) (b) 10,325
OWNER/OPERATOR THOROUGHBRED RACETRACKS
500,000 Natura Cosmetics (Brazil) (b) 8,042
DIRECT SALES OF HIGH-END COSMETICS
500,000 Callaway Golf 5,670
PREMIUM GOLF CLUBS & BALLS
345,000 Intralot (Greece) 5,485
LOTTERY & GAMING SYSTEMS & SERVICES
- ----------------------------------------------------------------------------
183,610
>CASINOS: 1.4%
2,750,000 Alliance Gaming (b)(c) 47,190
DIVERSIFIED GAMING COMPANY
890,000 Station Casinos 43,076
CASINOS & RIVERBOATS
875,000 Argosy Gaming (b) 32,900
REGIONAL RIVERBOAT CASINOS
1,925,000 Pinnacle Entertainment (b)(c) 24,274
REGIONAL RIVERBOAT CASINOS
5,000,000 Sky City Entertainment (New Zealand) 15,143
CASINO/ENTERTAINMENT COMPLEX
805,000 Monarch Casino & Resort (b)(c) 11,350
CASINO/HOTEL IN RENO
226,000 Lakes Entertainment (b) 2,619
GAMING ENTREPRENEUR
230,700 Rank Group (United Kingdom) 1,257
GAMING & MEDIA SERVICES
- ----------------------------------------------------------------------------
177,809
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>TRAVEL: 1.0%
2,314,500 Intrawest (Canada) $ 36,921
OWNER/OPERATOR OF SKI RESORTS
3,380,000 LaQuinta (b) 28,392
OWNER/FRANCHISER OF MID-PRICED HOTELS
1,115,000 Vail Resorts (b) 21,363
OWNER/OPERATOR OF SKI RESORTS
959,000 Navigant International (b)(c) 17,061
CORPORATE TRAVEL AGENCY
750,000 Orbitz (b)(c) 16,215
ONLINE TRAVEL DISTRIBUTION
720,000 Jurys Doyle Hotel (Ireland) 9,123
HOTEL GROUP
- ----------------------------------------------------------------------------
129,075
>RESTAURANTS: 0.8%
2,000,000 AFC Enterprises (b)(c) 43,000
POPEYES, CHURCHES FRIED CHICKEN
1,447,000 Autogrill (Italy) (b) 20,534
TOLLWAY RESTAURANTS
155,000 Kappa Create (Japan) 10,742
155,000 Kappa Create New Shares (Japan) 10,398
SUSHI CHAIN RESTAURANT OPERATOR
243,000 Cheesecake Factory (b) 9,669
CASUAL DINING RESTAURANTS
- ----------------------------------------------------------------------------
94,343
>CRUISE LINES: 0.1%
400,000 Carnival 18,800
LARGEST CRUISE LINE
- ----------------------------------------------------------------------------
GOODS
>APPAREL: 2.0%
2,840,000 Coach (b) 128,340
DESIGNER & RETAILER OF BRANDED LEATHER ACCESSORIES
564,000 Oxford Industries 24,568
BRANDED & PRIVATE LABEL APPAREL
400,000 Columbia Sportswear (b) 21,848
ACTIVE OUTDOOR APPAREL, FOOTWEAR & ACCESSORIES
3,000,000 Billabong International (Australia) 17,219
SURFWEAR APPAREL MANUFACTURER
828,000 Steven Madden (b)(c) 16,535
WHOLESALER/RETAILER OF FASHION FOOTWEAR
1,100,000 Wacoal (Japan) 11,695
WOMEN'S SPECIALTY APPAREL
369,000 Carter's (b) 10,742
CHILDREN'S BRANDED APPAREL
5,000,000 Pacific Brands (Australia) (b) 9,274
DOMINANT AUSTRALIAN APPAREL BRAND MANAGER
- ----------------------------------------------------------------------------
240,221
>FURNITURE/TEXTILES: 1.9%
1,600,000 HNI 67,728
OFFICE FURNITURE & FIREPLACES
1,900,000 Herman Miller 54,986
OFFICE FURNITURE
740,000 Mohawk Industries (b) 54,264
CARPET & FLOORING
422,000 American Woodmark (c) 25,257
KITCHEN CABINETS
1,700,000 Nobia (Sweden) 20,023
KITCHEN INTERIORS MANUFACTURING & DISTRIBUTION
26
1-800-922-6769
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>FURNITURE/TEXTILES--CONTINUED
550,000 Masonite International (Canada) (b) $ 14,186
DOOR MANUFACTURER
- ----------------------------------------------------------------------------
236,444
>LEISURE VEHICLES: 1.5%
1,745,000 Harley-Davidson 108,085
MOTORCYCLES & RELATED MERCHANDISE
1,495,000 Monaco Coach (c) 42,114
RECREATIONAL VEHICLES
550,000 Polaris Industries 26,400
MANUFACTURER OF LEISURE VEHICLES & RELATED PRODUCTS
2,850,000 Ducati Motor (Italy) (b) 3,995
MOTORCYCLES & RELATED MERCHANDISE
- ----------------------------------------------------------------------------
180,594
>DURABLE GOODS: 1.3%
1,326,000 SCP Pool 59,670
DISTRIBUTOR OF SWIMMING POOL SUPPLIES
605,000 Hunter Douglas (Netherlands) 29,455
WINDOW SHADES & VENETIAN BLINDS
465,000 Hyundai Mobis (South Korea) 20,716
AUTO PARTS
10,000,000 Techtronic Industries (Hong Kong) 15,978
POWER TOOLS
105,000 Funai Electric (Japan) 15,852
CONSUMER ELECTRONICS
644,100 Shimano (Japan) 15,326
BICYCLE COMPONENTS & FISHING TACKLE
- ----------------------------------------------------------------------------
156,997
>NONDURABLES: 1.1%
895,000 Scotts Company (b) 57,173
CONSUMER LAWN & GARDEN PRODUCTS
1,381,000 Helen of Troy (b) 50,917
HAIRDRYERS & CURLING IRONS
255,000 Uni-Charm (Japan) 12,704
INFANT HYGIENE & FEMININE CARE PRODUCTS
601,000 First Years (c) 11,179
INFANT & TODDLER PRODUCTS
- ----------------------------------------------------------------------------
131,973
>FOOD & BEVERAGES: 1.0%
1,600,000 Kerry (Ireland) 33,894
FOOD INGREDIENTS
850,000 NBTY (b) 24,981
VITAMINS & SUPPLEMENTS
30,000,000 Global Bio-Chem Technology
Group (China) 21,789
1,841,250 Global Bio-Chem Technology
Group Warrants (China) (b) 120
CHINESE REFINER OF CORN-BASED COMMODITIES
4,000,000 Lion Nathan (Australia) 18,845
BEER BREWER/DISTRIBUTOR
725,000 Orkla (Norway) 18,132
DIVERSIFIED CONSUMER GOODS
180,000 Davide Campari (Italy) 8,885
SPIRITS & WINE
- ----------------------------------------------------------------------------
126,646
-----------
CONSUMER GOODS/SERVICES: TOTAL 2,679,854
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
INDUSTRIAL GOODS/SERVICES: 13.5%
>LOGISTICS: 2.4%
2,750,000 Expeditors International of
Washington $ 135,877
INTERNATIONAL FREIGHT FORWARDER
900,000 UTI Worldwide 47,421
INTERNATIONAL FREIGHT FORWARDER
1,000,000 Forward Air (b) 37,400
FREIGHT TRANSPORTATION BETWEEN AIRPORTS
2,600,000 Exel (United Kingdom) 36,255
GLOBAL LOGISTICS & FREIGHT FORWARDING
549,000 Hub Group (b)(c) 18,721
TRUCK & RAIL FREIGHT FORWARDER
40,000,000 Sinotrans (China) 14,405
INTEGRATED LOGISTICS IN CHINA
11,000,000 Sembcorp Logistics (Singapore) 11,778
LOGISTIC SERVICES FOR MARINE TRANSPORT
- ----------------------------------------------------------------------------
301,857
>MACHINERY: 1.6%
2,250,000 Ametek 69,525
AEROSPACE/INDUSTRIAL INSTRUMENTS
1,050,000 Esco Technologies (b)(c) 56,028
FILTRATION & TEST EQUIPMENT
840,000 Pentair 28,258
PUMPS, WATER TREATMENT & TOOLS
785,000 Gardner Denver (b) 21,901
AIR COMPRESSORS, BLOWERS & PUMPS
500,000 Cobham (United Kingdom) 12,683
AEROSPACE
150,000 Tennant 6,218
NON-RESIDENTIAL FLOOR CLEANING EQUIPMENT
- ----------------------------------------------------------------------------
194,613
>SPECIALTY CHEMICALS & INDUSTRIAL
MATERIALS: 1.6%
2,550,000 Spartech (c) 66,147
PLASTICS DISTRIBUTION & COMPOUNDING
47,000 Geberit International (Switzerland) 31,331
PLUMBING SUPPLIES
1,000,000 Schulman 21,490
PLASTICS DISTRIBUTION & COMPOUNDING
37,000 Givaudan (Switzerland) 21,451
INDUSTRIAL FRAGRANCES & FLAVORS
450,000 Novozymes (Denmark) 20,305
INDUSTRIAL ENZYMES
25,000 Sika (Switzerland) (b) 13,763
CHEMICALS FOR CONSTRUCTION & INDUSTRIAL APPLICATION
200,000 Imerys (France) 11,660
INDUSTRIAL MINERALS PRODUCER
347,000 SYMYX (b) 8,370
MATERIALS & CHEMICALS
- ----------------------------------------------------------------------------
194,517
>INDUSTRIAL GOODS: 1.5%
1,400,000 Clarcor (c) 64,120
MOBILE & INDUSTRIAL FILTERS
1,500,000 Donaldson 43,950
INDUSTRIAL AIR FILTRATION
27
COLUMBIA ACORN FUND
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>INDUSTRIAL GOODS--CONTINUED
804,000 Mine Safety Appliances $ 27,095
SAFETY EQUIPMENT
300,000 Genlyte Group (b) 18,864
COMMERCIAL LIGHTING FIXTURES
500,000 Intermagnetics General (b) 17,015
SUPERCONDUCTING WIRE
100,000 Bacou Dalloz (France) 7,424
SAFETY EQUIPMENT
309,000 Electric City (b) 584
ELECTRICITY CONSERVATION DEVICES
- ----------------------------------------------------------------------------
179,052
>INDUSTRIAL DISTRIBUTION: 1.4%
1,525,000 Watsco (c) 42,807
HVAC DISTRIBUTION
600,000 Hughes Supply 35,358
INDUSTRIAL DISTRIBUTION
1,375,000 Airgas 32,876
INDUSTRIAL GAS DISTRIBUTOR
3,800,000 Grafton Group (Ireland) (b) 30,321
BUILDERS, WHOLESALERS & DIY RETAILING
900,000 Nuco2 (b)(c) 17,730
BULK CO2 GAS DISTRIBUTION TO RESTAURANTS
600,000 Aviall (b) 11,406
AIRCRAFT REPLACEMENT PARTS DISTRIBUTOR
- ----------------------------------------------------------------------------
170,498
>WATER: 1.0%
856,000 Cuno (b)(c) 45,668
FILTRATION & FLUIDS CLARIFICATION
2,600,000 Tetra Tech (b) 42,432
RESOURCE MANAGEMENT & INFRASTRUCTURE CONSULTING
900,000 Pall 23,571
FILTRATION & FLUIDS CLARIFICATION
554,000 Watts Water Technologies 14,930
WATER, VALVES, REGULATORS & FILTRATION
- ----------------------------------------------------------------------------
126,601
>CONSTRUCTION: 1.0%
787,500 Wienerberger (Austria) 27,473
BRICKS & CLAY ROOFING TILES
488,000 Simpson 27,387
WALL JOINT MAKER
638,000 Florida Rock Industries 26,904
CONCRETE & AGGREGATES
380,000 Daito Trust Construction (Japan) 14,612
APARTMENT BUILDER
3,000,000 Consorcio (Mexico) (b) 8,634
LOW/MEDIUM INCOME HOME BUILDER
750,000 McCarthy & Stone (United Kingdom) 7,925
BUILDER OF RETIREMENT APARTMENTS
290,000 Dominion Homes (b) 6,699
OHIO/KENTUCKY HOME BUILDER
- ----------------------------------------------------------------------------
119,634
>STEEL: 1.0%
1,900,000 Gibraltar Steel (c) 62,358
STEEL PROCESSING
750,000 Tenaris (Argentina) 24,563
STEEL PIPE FOR OIL WELLS & PIPELINES
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
1,050,000 Worthington Industries $ 21,557
STEEL PROCESSING
95,000 Vallourec (France) 9,339
SEAMLESS TUBES
- ----------------------------------------------------------------------------
117,817
>OTHER INDUSTRIAL SERVICES: 0.9%
1,500,000 Clark/Bardes Consulting (b)(c) 27,825
EXECUTIVE COMPENSATION & BENEFITS CONSULTING
825,000 Mobile Mini (b)(c) 23,438
LEASES PORTABLE STORAGE UNITS
550,000 G&K Services 22,104
UNIFORM RENTAL
1,125,000 Ushio (Japan) 20,353
INDUSTRIAL LIGHT SOURCES
60,000 Schindler (Switzerland) 17,238
ELEVATOR MANUFACTURER & SERVICE PROVIDER
185,000 Jaakko Poyry (Finland) 4,673
ENGINEERING CONSULTANTS IN FORESTRY, ENERGY
- ----------------------------------------------------------------------------
115,631
>OUTSOURCING SERVICES & TRAINING: 0.6%
1,800,000 Labor Ready (b) 27,900
TEMPORARY MANUAL LABOR
525,000 Bilfinger Berger (Germany) 18,167
CONSTRUCTION & RELATED SERVICES
9,500,000 Li & Fung (Hong Kong) 13,928
SOURCING OF CONSUMER GOODS
640,000 United Services Group (Netherlands) 10,443
TEMPORARY STAFFING SERVICES
600,000 GP Strategies (b) 3,954
TRAINING PROGRAMS
- ----------------------------------------------------------------------------
74,392
>CONGLOMERATES: 0.3%
737,560 Aalberts Industrie (Netherlands) 22,086
FLOW CONTROL & HEAT TREATMENT
5,550 Pargesa (Switzerland) 14,945
INDUSTRIAL & MEDIA HOLDINGS
- ----------------------------------------------------------------------------
37,031
>INDUSTRIAL SUPPLIERS: 0.2%
1,800,000 Xstrata (United Kingdom) 24,118
DIVERSIFIED MINING HOLDING COMPANY
- ----------------------------------------------------------------------------
-----------
INDUSTRIAL GOODS/SERVICES: TOTAL 1,655,761
- ----------------------------------------------------------------------------
FINANCE: 12.3%
>BANKS: 5.1%
1,751,000 TCF Financial 101,646
GREAT LAKES BANK
2,412,000 Associated Banc-Corp 71,468
MIDWEST BANK
1,638,000 BOK Financial (b) 64,324
OKLAHOMA BANK
2,187,000 Glacier Bancorp (c) 61,608
MOUNTAIN STATES BANK
1,300,000 Texas Regional Bancshares 59,683
SOUTH TEXAS BANK
28
1-800-922-6769
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>BANKS--CONTINUED
3,300,000 Anglo Irish Bank (Ireland) $ 51,693
SMALL BUSINESS & MIDDLE MARKET BANKING
1,320,000 West Coast Bancorp (c) 28,301
PORTLAND SMALL BUSINESS LENDER
1,850,000 Depfa Bank (Ireland) 27,005
INTERNATIONAL PUBLIC SECTOR FINANCE
1,698,000 Republic 23,602
MICHIGAN BANK
605,000 Chittenden 21,266
VERMONT & WESTERN MASSACHUSETTS BANK
2,800,000 Den Norske Bank (Norway) 19,099
LARGEST NORWEGIAN BANK
370,000 Cullen Frost Bankers 16,557
TOP SAN ANTONIO BANK
145,000 Komercni Banka (Czech Republic) 16,266
LEADING CZECH UNIVERSAL BANK
455,000 Great Southern Bancorp 13,309
MISSOURI REAL ESTATE LENDER
360,000 CityBank Lynnwood 11,527
SEATTLE REAL ESTATE LENDER
400,000 CorpBanca (Chile) (b)(d) 9,560
CHILE'S 3RD LARGEST LOCAL BANK
231,000 Bank of the Ozarks 5,382
ARKANSAS BANK
82,000 BankFirst 4,899
OKLAHOMA COMMUNITY BANK
170,000 Midwest Bank 3,791
CHICAGO BANK
82,000 First Financial BankShares 3,438
WEST TEXAS COMMUNITY BANK
188,000 Cascade Financial 3,290
SEATTLE COMMUNITY BANK
125,000 First Mutual Bancshares 3,156
SEATTLE COMMUNITY BANK
210,000 Credito Emiliano (Italy) 1,727
ITALIAN REGIONAL BANK
47,000 West Bancorporation 822
DES MOINES SMALL BUSINESS BANK
- ----------------------------------------------------------------------------
623,419
>INSURANCE: 2.6%
1,320,000 HCC Insurance Holdings 44,101
AVIATION INSURANCE
720,000 Philadelphia Consolidated Holding (b) 43,250
SPECIALTY INSURANCE
826,000 Leucadia National 41,052
INSURANCE HOLDING COMPANY
995,000 Protective Life 38,477
LIFE INSURANCE
138,000 Markel (b) 38,295
SPECIALTY INSURANCE
1,000,000 RLI 36,500
SPECIALTY INSURANCE
400,000 Selective Insurance Group 15,952
COMMERCIAL & PERSONAL LINES INSURANCE
650,000 Scottish Re Group 15,113
LIFE REINSURER
1,992,000 Jardine Lloyd Thompson
(United Kingdom) 14,851
BUSINESS INSURANCE BROKER
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
210,000 StanCorp Financial $ 14,070
GROUP LIFE, DISABILITY & 401K
700,000 United National Group (b) 10,577
SPECIALTY INSURANCE
245,000 Stewart Information Services 8,274
TITLE COMPANY
- ----------------------------------------------------------------------------
320,512
>SAVINGS & LOANS: 2.3%
3,276,000 Peoples Bank Bridgeport 102,047
CONNECTICUT SAVINGS & LOAN
1,227,000 Downey Financial 65,338
CALIFORNIA HOME LENDER
1,178,000 Anchor Bancorp Wisconsin (c) 31,146
WISCONSIN THRIFT
700,000 First Federal Capital 19,481
WISCONSIN THRIFT
1,700,000 Housing Development Finance (India) 19,131
PREMIER MORTGAGE LENDER IN INDIA
709,000 Washington Federal 17,016
OLD FASHIONED MORTGAGE LENDER
959,400 Irish Life & Permanent (Ireland) 14,787
SAVINGS PRODUCTS
200,000 Bankinter (Spain) 7,621
MORTGAGE LENDER
74,000 Imperial Thrift & Loan (b) 3,002
SAN DIEGO SPECIALTY LENDER
- ----------------------------------------------------------------------------
279,569
>FINANCE COMPANIES: 1.4%
5,831,000 AmeriCredit (b) 113,879
AUTO LENDING
1,820,000 World Acceptance (b)(c) 33,361
PERSONAL LOANS
784,000 Northgate (United Kingdom) 9,878
LIGHT COMMERCIAL VEHICLE RENTAL SPECIALIST
500,000 Intermediate Capital (United Kingdom) 9,815
EUROPEAN PROVIDER OF MEZZANINE CAPITAL
- ----------------------------------------------------------------------------
166,933
>MONEY MANAGEMENT: 0.8%
2,390,000 SEI Investments 69,406
MUTUAL FUND ADMINISTRATION & INVESTMENT MANAGEMENT
855,000 Eaton Vance 32,670
SPECIALTY MUTUAL FUNDS
200,000 The Investment Company of
China (China) (d) 90
CLOSED-END FUND
- ----------------------------------------------------------------------------
102,166
>BROKERAGE: 0.1%
1,215,000 Investment Technology Group (b) 15,540
ELECTRONIC TRADING
- ----------------------------------------------------------------------------
-----------
FINANCE: TOTAL 1,508,139
- ----------------------------------------------------------------------------
HEALTH CARE: 9.1%
>SERVICES: 3.2%
5,586,000 First Health (b)(c) 87,197
PPO NETWORK
2,491,000 Lincare Holdings (b) 81,854
HOME HEALTH CARE SERVICES
29
COLUMBIA ACORN FUND
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>SERVICES--CONTINUED
2,592,000 NDCHealth Group (c) $ 60,134
HEALTH CLAIMS PROCESSING & DRUG MARKETING SERVICES
640,000 Charles River Laboratories (b) 31,277
PHARMACEUTICAL RESEARCH
3,070,000 Gambro (Sweden) 29,798
PRODUCTS/SERVICES FOR RENAL CARE
510,000 OPG Groep (Netherlands) 27,296
PHARMACEUTICAL WHOLESALER & RETAILER
1,333,000 Dendrite International (b) 24,767
SOFTWARE FOR PHARMACEUTICAL SALES FORCE
450,000 Accredo Health (b) 17,527
SPECIALTY PHARMACY
296,000 Omega Pharma (Belgium) 15,019
OTC PRODUCTS, PHARMACY & DENTAL SUPPLIES
550,000 Serologicals (b) 10,995
BLOOD COLLECTION & ANTIBODY PRODUCTION
440,000 Medquist (b) 5,038
MEDICAL TRANSCRIPTION SERVICES
- ----------------------------------------------------------------------------
390,902
>MEDICAL EQUIPMENT/LABORATORY
SUPPLIES: 2.8%
1,629,000 Edwards Lifesciences (b) 56,771
HEART VALVES
1,239,000 Diagnostic Products 54,442
IMMUNODIAGNOSTIC KITS
2,910,000 Smith & Nephew (United Kingdom) 31,402
MEDICAL EQUIPMENT & SUPPLIES
1,900,000 CTI Molecular Imaging (b) 26,942
MEDICAL DIAGNOSTIC DEVICES
1,000,000 VISX (b) 26,720
LASER EYE SURGERY EQUIPMENT
583,000 Orthofix International (b) 24,912
BONE FIXATION & STIMULATION DEVICES
365,000 Essilor International (France) 23,845
EYEGLASS LENSES
200,000 Synthes-Stratec (Switzerland) 22,820
PRODUCTS FOR ORTHOPEDIC SURGERY
670,000 ICU Medical (b) 22,465
INTRAVENOUS THERAPY PRODUCTS
875,000 Viasys Healthcare (b) 18,296
RESPIRATORY & NEUROLOGY MEDICAL EQUIPMENT
1,000,000 Sola International (b) 17,230
SPECIALTY EYEGLASS LENSES
350,000 Haemonetics (b) 10,377
BLOOD & PLASMA COLLECTION EQUIPMENT
190,000 Hogy Medical (Japan) 9,549
DISPOSABLE SURGICAL PRODUCTS
- ----------------------------------------------------------------------------
345,771
>BIOTECHNOLOGY/DRUG DELIVERY: 2.4%
519,000 Martek Biosciences (b) 29,152
FATTY ACIDS FOR BABY FORMULA & OTHER FOODS
775,000 Par Pharmaceuticals (b) 27,288
GENERICS
1,250,000 Ligand Pharmaceuticals (b) 21,725
DRUGS FOR PAIN, CANCER, OSTEOPOROSIS, & DIABETES
1,055,000 Nektar Therapeutics (b) 21,058
DRUG DELIVERY TECHNOLOGIES
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
360,000 Neurocrine Biosciences (b) $ 18,666
DRUGS FOR SLEEP, DIABETES, MS & ENDOMETRIOSIS
776,000 NPS Pharmaceuticals (b) 16,296
SMALL MOLECULE DRUGS
1,165,000 DOV Pharmaceutical (b)(c) 16,263
DRUGS FOR INSOMNIA, ANXIETY, PAIN & DEPRESSION
789,000 Atherogenics (b) 15,015
DRUGS FOR ATHEROSCLEROSIS, RHEUMATOID ARTHRITIS, ASTHMA
1,876,000 Lexicon Genetics (b) 14,708
DRUG DISCOVERY
2,000,000 Medarex (b) 14,580
HUMANIZED ANTIBODIES
1,708,000 Ciphergen Biosystems (b)(c) 12,503
PROTEIN CHIPS USED FOR DRUG TARGET DISCOVERY
1,709,000 Pozen (b)(c) 11,690
DRUGS FOR MIGRAINES
608,000 Protein Design Labs (b) 11,631
MONOCLONAL ANTIBODIES
1,700,000 Sangamo Biosciences (b)(c) 10,234
DRUG DISCOVERY
1,150,000 Bioveris (b) 9,568
IMMUNODIAGNOSTIC TECHNOLOGY
3,500,000 La Jolla Pharmaceutical (b)(c) 8,505
LUPUS TREATMENT
460,000 Myriad Genetics (b) 6,863
GENE DISCOVERY & DIAGNOSTIC PRODUCTS
635,000 Maxygen (b) 6,712
MOLECULAR BREEDING
638,000 Diversa (b) 6,463
MOLECULAR BREEDING
304,000 Alexion Pharmaceuticals (b) 5,654
MONOCLONAL ANTIBODIES
865,000 Arena Pharmaceuticals (b) 4,723
NOVEL DRUG TARGETING TECHNOLOGY
2,800,000 Sequenom (b)(c) 4,088
HIGH SPEED DNA ANALYSIS INSTRUMENTS
1,875 Locus Discovery, Series D, Pfd. (d) 3,750
HIGH THROUGHPUT RATIONAL DRUG DESIGN
461,000 SYRRX, Series C (d) 2,305
X-RAY CRYSTALLOGRAPHY
1,249,999 Perlegen Sciences (d) 1,950
LARGE SCALE GENE SEQUENCING
359,944 Microdose (d) 180
DRUG INHALERS
- ----------------------------------------------------------------------------
301,570
>MEDICAL SUPPLIES: 0.4%
686,000 Techne (b) 29,807
CYTOKINES, ANTIBODIES, OTHER REAGENTS FOR LIFE SCIENCES
650,000 Owens & Minor 16,835
DISTRIBUTION OF MEDICAL SUPPLIES
- ----------------------------------------------------------------------------
46,642
>HOSPITAL MANAGEMENT: 0.2%
500,000 Rhoen-Klinikum (Germany) 26,875
HOSPITAL MANAGEMENT
- ----------------------------------------------------------------------------
30
1-800-922-6769
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>PHARMACEUTICALS: 0.1%
138,000 Yuhan (South Korea) $ 8,482
ETHICAL DRUG PRODUCER
2,000,000 United Drug (Ireland) 6,811
IRISH PHARMACEUTICAL WHOLESALER & OUTSOURCER
- ----------------------------------------------------------------------------
15,293
-----------
HEALTH CARE: TOTAL 1,127,053
- ----------------------------------------------------------------------------
ENERGY/MINERALS: 9.1%
>OIL/GAS PRODUCERS: 5.6%
7,275,000 XTO Energy 216,722
NATURAL GAS PRODUCER
2,800,000 Western Gas 90,944
OIL PRODUCER & COAL SEAM GAS PRODUCER
2,350,000 Ultra Petroleum (b) 87,726
NATURAL GAS PRODUCER
3,000,000 Talisman Energy (Canada) 65,227
OIL & GAS PRODUCER
1,300,000 Southwestern Energy (b) 37,271
NATURAL GAS PRODUCER
925,000 Nexen (Canada) 35,938
OIL & GAS PRODUCER
15,400,000 Tullow Oil (United Kingdom) 34,399
OIL & GAS PRODUCER
465,000 Quicksilver (b) 31,188
NATURAL GAS & COAL SEAM GAS PRODUCER
814,000 Denbury Resources (b) 17,053
OIL PRODUCER USING CO2 INJECTION
915,000 McMoRan Exploration (b)(c) 14,256
NATURAL GAS PRODUCERS & LNG DEVELOPER
582,000 Petrokazakhstan (Canada) (b) 15,842
OIL PRODUCER & REFINER IN KAZAKHSTAN
916,000 Range Resources 13,374
OIL & GAS PRODUCER
440,000 Clayton Williams Energy (b)(d) 9,675
40,000 Clayton Williams Energy (b) 956
OIL & GAS PRODUCER
3,458,200 Esprit Exploration (Canada) (b) 9,018
NATURAL GAS PRODUCER
2,265,000 Tipperary (b)(c) 8,086
COAL SEAM GAS PRODUCER
- ----------------------------------------------------------------------------
687,675
>OIL SERVICES: 2.0%
2,300,000 FMC Technologies (b) 66,240
OIL & GAS WELL HEAD MANUFACTURER
730,000 Carbo Ceramics 49,822
NATURAL GAS WELL STIMULANTS
4,750,000 Newpark Resources (b)(c) 29,450
DRILLING FLUID SERVICES TO OIL & GAS INDUSTRY
333,000 Fugro (Netherlands) 21,459
SURVEY & GPS SERVICES
700,000 Chicago Bridge & Iron 19,495
ENGINEERING & CONSTRUCTION FOR PETROCHEMICALS & LNG
2,000,000 Key Energy Services (b) 18,880
OIL & GAS WELL WORKOVER SERVICES
2,000,000 Saipem (Italy) 18,226
OFFSHORE CONSTRUCTION & DRILLING
1,050,000 Enerflex Systems (Canada) 16,475
NATURAL GAS COMPRESSOR
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
800,000 Hanover Compressor (b) $ 9,520
NATURAL GAS COMPRESSOR RENTAL
- ----------------------------------------------------------------------------
249,567
>DISTRIBUTION/MARKETING/REFINING: 1.2%
1,600,000 Equitable Resources 82,736
NATURAL GAS UTILITY & PRODUCER
1,900,000 Oneok 41,781
NATURAL GAS UTILITY, MARKETING & PROCESSING
761,000 Atmos Energy 19,482
NATURAL GAS UTILITY
- ----------------------------------------------------------------------------
143,999
>INDEPENDENT POWER: 0.2%
1,470,000 Gamesa (Spain) 21,712
SPANISH WIND TURBINES
314,000 Millennium Cell (b) 584
FUEL CELL TECHNOLOGY
- ----------------------------------------------------------------------------
22,296
>MINING: 0.1%
700,000 Noranda (Canada) 11,998
DIVERSIFIED NON-FERROUS METALS MINER
- ----------------------------------------------------------------------------
-----------
ENERGY/MINERALS: TOTAL 1,115,535
- ----------------------------------------------------------------------------
OTHER INDUSTRIES: 3.6%
>REAL ESTATE: 2.6%
825,000 The Rouse Company 39,188
REGIONAL SHOPPING MALLS
1,320,000 General Growth Properties 39,032
REGIONAL SHOPPING MALLS
699,000 Forest City Enterprises, Cl. B 36,942
COMMERCIAL & RESIDENTIAL PROPERTY DEVELOPER
650,000 SL Green Realty 30,420
MANHATTAN OFFICE BUILDINGS
635,000 Macerich Company 30,397
REGIONAL SHOPPING MALLS
620,000 Mills 28,954
REGIONAL SHOPPING MALLS
575,000 Federal Realty Investment Trust 23,914
SHOPPING CENTERS
1,375,000 Crescent Real Estate Equities 22,165
CLASS A OFFICE BUILDINGS
650,000 United Dominion Realty 12,857
APARTMENTS
1,240,000 Highland Hospitality (b) 12,462
HOTEL REAL ESTATE INVESTMENT TRUST
1,352,600 Sponda (Finland) 11,490
OFFICE & WAREHOUSE PROPERTY COMPANY
1,000,000 Diamondrock Hospitality (b) 10,000
HOTEL REAL ESTATE INVESTMENT TRUST
190,000 Consolidated Tomoka 7,174
FLORIDA LAND OWNER
686,111 Am NV (Netherlands) 6,428
PROPERTY DEVELOPER
194,827 Security Capital European
Realty (Luxembourg) (d) 3,112
SELF STORAGE PROPERTIES
- ----------------------------------------------------------------------------
314,535
31
COLUMBIA ACORN FUND
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>REGULATED UTILITIES: 0.4%
1,650,000 Northeast Utilities $ 32,125
REGULATED ELECTRIC UTILITY
799,800 Red Electrica (Spain) 13,618
SPANISH POWER GRID
- ----------------------------------------------------------------------------
45,743
>TRANSPORTATION: 0.3%
140,000 Kobenhavns Lufthavne (Denmark) 20,416
COPENHAGEN AIRPORT AUTHORITY
620,000 Grupo Aeroportaurio Del
Sureste (Mexico) 11,470
CANCUN & COZUMEL AIRPORT OPERATOR
15,000,000 Comfort Group (Singapore) 10,742
TAXI SERVICE
- ----------------------------------------------------------------------------
42,628
>WASTE MANAGEMENT: 0.3%
1,275,000 Waste Connections (b) 37,817
SOLID WASTE MANAGEMENT
- ----------------------------------------------------------------------------
-----------
OTHER INDUSTRIES: TOTAL 440,723
TOTAL COMMON STOCKS AND OTHER
EQUITY-LIKE SECURITIES: 94.3% 11,592,161
(COST: $7,214,239)
PRINCIPAL AMOUNT (000) VALUE (000)
- ----------------------------------------------------------------------------
SHORT-TERM OBLIGATIONS: 5.6%
Yield 1.04% - 1.30%
Due 7/01/04 - 8/05/04
$ 77,000 General Electric Capital $ 76,939
76,000 Bayer 75,980
72,000 Citigroup 71,934
71,000 Bell South 70,942
70,000 Cargill 69,955
63,980 Campbell Soup 63,950
60,000 Household Finance 59,970
55,000 Coca Cola Enterprises 54,978
40,000 Virginia Electric & Power 39,993
40,000 Toyota Credit de Puerto Rico 39,951
30,000 Toyota Motors 29,978
30,000 John Hancock Finance 29,970
2,506 Repurchase Agreement with State
Street Bank & Trust Dated
6/30/04, Due 7/01/04 at 1.30%
Collateralized by Federal Home
Loan Mortgage Corporation,
Notes, Maturing 2/15/05, Market
Value $2,560 (Repurchase
proceeds: $2,506) 2,506
- ----------------------------------------------------------------------------
(AMORTIZED COST: $687,046) 687,046
-----------
TOTAL INVESTMENTS (E): 99.9% 12,279,207
(COST: $7,901,285) (A)
-----------
CASH AND OTHER ASSETS LESS LIABILITIES: 0.1% 10,343
-----------
TOTAL NET ASSETS: 100% $12,289,550
============================================================================
32
1-800-922-6769
- --------------------------------------------------------------------------------
>NOTES TO STATEMENT OF INVESTMENTS (IN THOUSANDS)
(a) At June 30, 2004, for federal income tax purposes cost of investments was
the same and net unrealized appreciation was $4,377,922 consisting of gross
unrealized appreciation of $4,722,467 and gross unrealized depreciation of
$344,545.
(b) Non-income producing security.
(c) An affiliate may include any company in which the Fund owns five percent or
more of its outstanding voting securities. On June 30, 2004, the Fund held
five percent or more of the outstanding voting securities of the following
companies:
Christopher & Banks 10.26%
AnswerThink Consulting 10.23%
World Acceptance 9.84%
Indus International 9.81%
New Horizons Worldwide 9.81%
Actuate 9.75%
Gibraltar Steel 9.71%
Analysts International 9.50%
MAPICS 9.25%
Seachange International 9.11%
Skillsoft Publishing 9.02%
Igate Capital 8.96%
Glacier Bancorp 8.93%
E.Piphany 8.82%
West Coast Bancorp 8.79%
BSQUARE 8.71%
Monarch Casino & Resort 8.59%
Nuco2 8.41%
MRO Software 8.18%
Esco Technologies 8.12%
Clark/Bardes Consulting 8.06%
Spartech 7.94%
Cable Design Technologies 7.66%
Concurrent Computer 7.58%
JDA Software Group 7.57%
First Years 7.20%
NDCHealth Group 7.20%
AFC Enterprises 7.13%
Sequenom 7.06%
Action Performance 6.96%
Bally Total Fitness 6.90%
Sangamo Biosciences 6.76%
Watsco 6.66%
Witness Systems 6.55%
Navigant International 6.52%
Gaiam 6.46%
DOV Pharmaceutical 6.45%
Princeton Review 6.38%
Steve Madden 6.21%
First Health 6.10%
Coinstar 6.05%
Pozen 5.93%
Vital Stream, Cl. C 5.92%
Hub Group 5.89%
Ciphergen Biosystems 5.87%
Orbitz 5.79%
La Jolla Pharmaceutical 5.77%
Tipperary 5.76%
Mobile Mini 5.75%
Radiant Systems 5.71%
Newpark Resources 5.67%
Clarcor 5.51%
Pegasus Systems 5.44%
Alliance Gaming 5.43%
Pinnacle Entertainment 5.42%
Saga Communications 5.38%
McMoRan Exploration 5.31%
Insight Communications 5.29%
Kronos 5.23%
Excel Technologies 5.19%
Ciber 5.14%
Micros Systems 5.13%
American Woodmark 5.13%
Anchor Bancorp Wisconsin 5.13%
Monaco Coach 5.10%
Avid Technology 5.06%
Cuno 5.05%
InfoUSA 5.03%
The aggregate cost and value of these companies at June 30, 2004, was
$1,459,400 and $2,055,516 respectively. Investments in affiliate companies
represent 16.73% of total net assets at June 30, 2004. Investment activity
and income amounts relating to affiliates during the six months ended June
30, 2004 were as follows:
Dividend Income $ 3,333
Net realized gain or loss $ 62,019
Change in unrealized gain or loss $ 4,005
Purchases $ 182,823
Proceeds from sales $ 214,679
In addition, additional purchases of existing portfolio holdings that were
not considered affiliates in prior years, resulted in the Fund owning more
than 5% of the outstanding shares of certain issues at June 30, 2004.
Therefore, the cost and market value of the affiliate disclosure amounts
include both acquisitions of new investments in affiliates during the
period, as well as prior period investment holdings that became affiliates
during the current period.
33
COLUMBIA ACORN FUND
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
(d) Denotes a restricted security, which is subject to restrictions on resale
under federal securities laws. These securities, except for CorpBanca, are
valued in good faith by the Board of Trustees. At June 30, 2004, these
securities amounted to $33,632, which represents 0.27% of total net assets.
Additional information on these securities is as follows:
ACQUISITION SHARES/
SECURITY DATES PAR (000) COST (000) VALUE (000)
- -------- ----------- --------- --------- ----------
CorpBanca 11/19/03 400 $ 10,290 $ 9,560
Clayton Williams Energy 05/25/04 440 10,120 9,675
Gadzooks 5.00% Convertible 10/07/08 10/08/03 $ 6,000 6,000 2,941
Locus Discovery, Series D, Pfd. 09/05/01 1,875 7,500 3,750
Microdose 11/24/00 360 2,005 180
NeoPlanet, Series A 02/12/99 250 2,000 51
NeoPlanet, Series B 02/17/00 53 641 18
Perlegen Sciences 03/30/01 1,250 4,500 1,950
Security Capital European Realty 08/20/98-11/12/99 195 3,897 3,112
SYRRX, Series C, Pfd. 01/08/01 461 2,997 2,305
The Investment Company of China 10/22/92-03/15/00 200 1,690 90
---------- ----------
$ 51,640 $ 33,632
========== ==========
(e) On June 30, 2004, the market value of foreign securities represents 15.0% of
total net assets. The Fund's foreign portfolio was diversified as follows:
VALUE PERCENT
------------ -----------
Canada $ 247,544 2.0%
United Kingdom 216,072 1.8
Ireland 173,634 1.4
Japan 155,653 1.3
Switzerland 121,548 1.0
Netherlands 117,167 1.0
France 81,909 0.7
Singapore 55,635 0.5
Germany 53,952 0.4
Italy 53,367 0.4
Hong Kong 51,301 0.4
Sweden 49,821 0.4
Australia 45,338 0.4
Spain 44,070 0.4
Denmark 40,721 0.3
Norway 37,231 0.3
VALUE PERCENT
------------ -----------
China $ 36,404 0.3%
Finland 35,444 0.3
South Korea 29,198 0.3
Austria 27,473 0.2
Argentina 24,563 0.2
Luxembourg 24,559 0.2
Mexico 20,104 0.1
India 19,131 0.1
Czech Republic 16,266 0.1
New Zealand 15,143 0.1
Belgium 15,019 0.1
Taiwan 10,517 0.1
Chile 9,560 0.1
Brazil 8,042 0.1
Greece 5,485 0.0
------------ -----------
Total Foreign Portfolio $ 1,841,871 15.0%
============ ===========
34
1-800-922-6769
COLUMBIA ACORN INTERNATIONAL
>MAJOR PORTFOLIO CHANGES IN THE SECOND QUARTER (UNAUDITED)
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
ADDITIONS
- ----------------------------------------------------------------------------
EUROPE
>UNITED KINGDOM/IRELAND
Business Post 810,000 1,050,000
Exel 1,500,000 1,750,000
Jardine Lloyd Thompson 800,000 1,593,000
Jurys Doyle Hotel (Ireland) 740,000 810,000
Northgate 0 473,000
Rank Group 0 230,800
RPS Group 5,800,000 6,158,000
Tullow Oil 8,000,000 9,200,000
>NETHERLANDS
Fugro 200,000 278,800
Koninklijke Ten Cate 0 157,947
>GERMANY/AUSTRIA
Wienerberger (Austria) 420,000 472,500
Wincor Nixdorf 0 66,000
>FRANCE
Camaieu 35,000 54,000
Metropole TV 200,000 300,000
>SPAIN
Gamesa 380,000 850,000
Gestevision Telecinco 0 132,000
Prosegur 400,000 550,000
>SWEDEN
Hexagon 293,000 368,000
>ITALY
Amplifon 90,000 216,000
Credit Emiliano 0 210,000
>LUXEMBOURG
SES Global 1,280,000 1,880,000
>CZECH REPUBLIC
Komercni Banka 0 100,000
>POLAND
Central European Distribution 159,900 207,450
(INCLUDES THE EFFECT OF A 3 FOR 2 STOCK SPLIT)
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
- ----------------------------------------------------------------------------
ASIA
>JAPAN
Ain Pharmaciez 0 155,200
Bank of Fukuoka 0 1,500,000
Bank of Yokohama 0 1,400,000
Chiyoda Integre 150,000 234,900
Daito Trust Construction 346,300 480,100
Hogy Medical 186,000 226,000
Olympus Optical 0 325,000
Otsuke Kagu 0 326,900
Sugi Pharmacy 270,000 330,000
Wacoal 0 1,500,000
>HONG KONG/CHINA
Global Bio-Chem Technology
Group (China) 15,842,000 23,000,000
>TAIWAN
ASE Test 1,130,000 1,230,000
Bank of Kaohsiung 5,320,000 7,700,000
Phoenixtec Power 8,539,000 11,540,000
Springsoft Systems 435,000 3,200,000
- ----------------------------------------------------------------------------
OTHER COUNTRIES
>AUSTRALIA
Pacific Brands 0 5,000,000
>SOUTH AFRICA
Edgars Consolidated Stores 0 252,000
- ----------------------------------------------------------------------------
LATIN AMERICA
>MEXICO
URBI Desarrollo 0 690,000
>ARGENTINA
Tenaris 400,000 440,000
>BRAZIL
Natura Cosmetics 0 517,000
35
COLUMBIA ACORN INTERNATIONAL
>MAJOR PORTFOLIO CHANGES IN THE SECOND QUARTER (UNAUDITED),
CONTINUED
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
SALES
- ----------------------------------------------------------------------------
EUROPE
>UNITED KINGDOM/IRELAND
Bunzl 1,400,000 1,000,000
Depfa Bank (Ireland) 1,200,000 1,000,000
(INCLUDES THE EFFECT OF A 10 FOR 1 STOCK SPLIT)
Euro Money Institutional Investor 1,200,000 0
Grafton Group (Ireland) 2,900,000 2,750,000
Hit Entertainment 3,000,000 0
Irish Life & Permanent (Ireland) 800,000 767,600
McCarthy & Stone 450,000 0
>NETHERLANDS
IM Tech 545,000 400,000
Vopak 792,000 581,886
>FRANCE
Essilor International 230,000 140,000
Euronext 300,000 0
Fininfo 476,000 404,000
Groupe Bourbon 40,000 0
Neopost 549,400 429,400
>SWITZERLAND
BKW Energie 15,000 0
Givaudan 25,000 15,000
Kaba Holdings 30,000 0
>SPAIN
Cortefiel 800,000 0
Red Electrica 600,000 420,000
>SWEDEN
Intrum Justitia 2,980,000 2,630,000
Munters 80,000 0
>NORWAY
Orkla 291,000 221,000
>DENMARK
Kobenhavns Lufthavne 100,000 65,000
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
- ----------------------------------------------------------------------------
ASIA
>JAPAN
ARRK 360,000 280,000
Bellsystem 24 35,000 0
Fast Retailing 263,000 220,000
Nissin Healthcare 390,000 0
Park 24 370,000 210,000
Shimano 650,000 442,500
Taisei Lamick 100,000 0
USS 190,000 0
>HONG KONG
Lianhua Supermarket 5,000,000 930,000
TVB 2,000,000 108,300
>INDIA
Gas Authority of India 660,000 0
>THAILAND
Airports of Thailand 1,357,800 0
- ----------------------------------------------------------------------------
OTHER COUNTRIES
>CANADA
Corus Entertainment 825,000 500,000
Nexen 400,000 0
Noranda 500,000 400,000
Patheon 1,112,000 0
Power Financial 200,000 0
Shawcor 392,000 0
36
1-800-922-6769
COLUMBIA ACORN INTERNATIONAL
>STATEMENT OF INVESTMENTS (UNAUDITED), JUNE 30, 2004
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
COMMON STOCKS AND OTHER
EQUITY-LIKE SECURITIES: 96.8%
- ----------------------------------------------------------------------------
EUROPE: 57.0%
>UNITED KINGDOM/IRELAND: 19.0%
2,350,000 Anglo Irish Bank (Ireland) $ 36,812
SMALL BUSINESS & MIDDLE MARKET BANKING
1,750,000 Exel 24,402
GLOBAL LOGISTICS & FREIGHT FORWARDING
1,100,000 Kerry (Ireland) 23,302
FOOD INGREDIENTS
2,750,000 Grafton Group (Ireland) 21,943
BUILDERS, WHOLESALERS & DIY RETAILING
9,200,000 Tullow Oil 20,550
OIL & GAS PRODUCER
1,450,000 Smith & Nephew 15,647
MEDICAL EQUIPMENT & SUPPLIES
600,000 Cobham 15,220
AEROSPACE
1,000,000 Depfa Bank (Ireland) 14,597
INTERNATIONAL PUBLIC SECTOR FINANCE
6,158,000 RPS Group 14,555
ENVIRONMENTAL CONSULTING
1,700,000 Burberry 12,630
APPAREL RETAILER
2,400,000 Expro International 11,981
OFFSHORE OIL FIELD SERVICES
1,593,000 Jardine Lloyd Thompson 11,876
BUSINESS INSURANCE BROKER
767,600 Irish Life & Permanent (Ireland) 11,831
SAVINGS PRODUCTS
1,200,000 Spectris 10,883
ELECTRONIC INSTRUMENTATION & CONTROLS
810,000 Jurys Doyle Hotel (Ireland) 10,264
HOTEL GROUP
750,000 Xstrata 10,049
DIVERSIFIED MINING HOLDING COMPANY
2,950,000 United Drug (Ireland) 10,046
IRISH PHARMACEUTICAL WHOLESALER & OUTSOURCER
500,000 Intermediate Capital 9,815
EUROPEAN PROVIDER OF MEZZANINE CAPITAL
1,050,000 Business Post 9,355
PARCEL & EXPRESS MAIL SERVICE
1,000,000 Bunzl 8,348
DISTRIBUTION OF DISPOSABLE PRODUCTS TO FOOD INDUSTRY
1,000,000 Kensington 7,995
NON-CONFORMING MORTGAGE COMPANY
473,000 Northgate 5,960
LIGHT COMMERCIAL VEHICLE RENTAL SPECIALIST
1,200,000 BBA Group 5,942
AVIATION SUPPORT SERVICES
200,000 Surfcontrol (b) 2,222
INTERNET FILTERING SOFTWARE
230,800 Rank Group 1,258
GAMING & MEDIA SERVICES
- ----------------------------------------------------------------------------
327,483
>NETHERLANDS: 7.4%
278,800 Fugro 17,966
SURVEY & GPS SERVICES
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
327,000 OPG Groep $ 17,502
PHARMACEUTICAL WHOLESALER & RETAILER
353,000 Hunter Douglas 17,186
DECORATIVE WINDOW COVERINGS
569,390 Aalberts Industrie 17,050
FLOW CONTROL & HEAT TREATMENT
684,000 United Services Group 11,161
TEMPORARY STAFFING SERVICES
400,000 IM Tech 10,962
TECHNICAL ENGINEERING
339,928 Sligro Food Group 10,838
FOOD SERVICE & WHOLESALING
581,886 Vopak 9,594
OIL & CHEMICAL STORAGE
157,947 Koninklijke Ten Cate 8,638
ADVANCED TEXTILES & INDUSTRIAL FABRICS
686,111 Am NV 6,428
PROPERTY DEVELOPER
- ----------------------------------------------------------------------------
127,325
>GERMANY/AUSTRIA: 6.9%
315,000 Rhoen-Klinikum Pfd. 17,310
300,000 Rhoen-Klinikum 16,125
HOSPITAL MANAGEMENT
472,500 Wienerberger (Austria) 16,484
BRICKS & CLAY ROOFING TILES
550,000 Hugo Boss Designs 12,467
FASHION APPAREL
300,000 Bilfinger Berger 10,381
CONSTRUCTION & RELATED SERVICES
300,000 Kali & Salz 10,179
POTASH PRODUCTS, FERTILIZERS, SALT & WASTE MANAGEMENT
250,000 GFK 8,734
MARKET RESEARCH SERVICES
1,000,000 Takkt 8,335
MAIL ORDER RETAILER OF OFFICE & WAREHOUSE DURABLES
300,000 Zapf Creation 7,062
TOY MANUFACTURER
75,000 Beru 5,752
AUTO PARTS & ELECTRONICS
66,000 Wincor Nixdorf (b) 3,637
MANUFACTURES ATM MACHINES & RETAIL POS SYSTEMS
260,000 Deutsche Beteiligungs (b) 3,376
PRIVATE EQUITY INVESTMENT MANAGEMENT
- ----------------------------------------------------------------------------
119,842
>FRANCE/BELGIUM: 6.3%
429,400 Neopost 25,411
POSTAGE METERS
244,000 Omega Pharma (Belgium) 12,380
OTC PRODUCTS, PHARMACY & DENTAL SUPPLIES
150,000 Bacou Dalloz 11,136
SAFETY EQUIPMENT
404,000 Fininfo 11,095
DATA FEEDS FOR FRENCH BANKS & BROKERS
160,000 Imerys 9,328
INDUSTRIAL MINERALS PRODUCER
140,000 Essilor International 9,146
EYEGLASS LENSES
90,000 Vallourec 8,847
SEAMLESS TUBES
37
COLUMBIA ACORN INTERNATIONAL
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>FRANCE/BELGIUM--CONTINUED
90,000 Bonduelle $ 8,541
PRODUCER OF CANNED, FROZEN & FRESH VEGETABLES
300,000 Metropole TV 8,481
TELEVISION BROADCASTER
54,000 Camaieu 4,826
WOMEN'S APPAREL RETAILER
- ----------------------------------------------------------------------------
109,191
>SWITZERLAND: 4.6%
25,000 Geberit International 16,666
PLUMBING SUPPLIES
130,000 Synthes-Stratec 14,833
PRODUCTS FOR ORTHOPEDIC SURGERY
24,000 Sika 13,213
CHEMICALS FOR CONSTRUCTION & INDUSTRIAL APPLICATION
40,000 Schindler 11,492
ELEVATOR MANUFACTURER & SERVICE PROVIDER
15,000 Givaudan 8,696
INDUSTRIAL FRAGRANCES & FLAVORS
3,000 Pargesa 8,079
INDUSTRIAL & MEDIA CONGLOMERATE
110,000 Bachem 6,286
PEPTIDES
- ----------------------------------------------------------------------------
79,265
>SPAIN: 3.0%
2,000,000 Abengoa 17,762
ENGINEERING & CONSTRUCTION
850,000 Gamesa 12,554
WIND TURBINES
550,000 Prosegur 8,467
SECURITY GUARDS
420,000 Red Electrica 7,151
SPANISH POWER GRID
120,000 Bankinter 4,573
MORTGAGE LENDER
132,000 Gestevision Telecinco (b) 1,970
SPAIN'S SECOND LARGEST BROADCASTER
- ----------------------------------------------------------------------------
52,477
>SWEDEN: 2.2%
2,630,000 Intrum Justitia (b) 15,394
RECEIVABLES MANAGEMENT & DEBT COLLECTION
368,000 Hexagon 12,371
DIVERSIFIED ENGINEERING
860,000 Nobia 10,130
KITCHEN INTERIORS MANUFACTURING & DISTRIBUTION
- ----------------------------------------------------------------------------
37,895
>ITALY: 2.1%
1,130,000 Autogrill (b) 16,035
RESTAURANTS & CATERING FOR TRAVELERS
212,000 Davide Campari 10,464
BEVERAGES
216,000 Amplifon 7,694
HEARING AID RETAILER
210,000 Credit Emiliano 1,727
REGIONAL BANK
- ----------------------------------------------------------------------------
35,920
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>FINLAND: 1.7%
438,300 Jaakko Poyry $ 11,071
ENGINEERING CONSULTANTS IN FORESTRY, ENERGY
185,000 Amer Group 9,640
BRANDED SPORTING GOODS
950,000 Sponda 8,070
OFFICE & WAREHOUSE PROPERTY COMPANY
- ----------------------------------------------------------------------------
28,781
>NORWAY: 1.0%
1,210,000 Den Norske Bank 8,253
LARGEST NORWEGIAN BANK
221,000 Orkla 5,527
DIVERSIFIED CONSUMER GOODS
220,000 Ekornes 4,312
NICHE FURNITURE MANUFACTURER
- ----------------------------------------------------------------------------
18,092
>LUXEMBOURG: 0.9%
1,880,000 SES Global 15,893
SATELLITE BROADCASTING SERVICES
- ----------------------------------------------------------------------------
>CZECH REPUBLIC: 0.7%
100,000 Komercni Banka 11,218
LEADING CZECH UNIVERSAL BANK
- ----------------------------------------------------------------------------
>DENMARK: 0.5%
65,000 Kobenhavns Lufthavne 9,479
COPENHAGEN AIRPORT AUTHORITY
- ----------------------------------------------------------------------------
>GREECE: 0.4%
465,000 Intralot 7,393
LOTTERY & GAMING SYSTEMS & SERVICES
- ----------------------------------------------------------------------------
>POLAND: 0.3%
207,450 Central European Distribution (b) 5,375
SPIRITS & WINE DISTRIBUTION
- ----------------------------------------------------------------------------
-----------
EUROPE: TOTAL 985,629
- ----------------------------------------------------------------------------
ASIA: 28.9%
>JAPAN: 15.6%
480,100 Daito Trust Construction 18,461
APARTMENT BUILDER
220,000 Fast Retailing 17,876
APPAREL RETAILER
1,500,000 Wacoal 15,947
WOMEN'S SPECIALTY APPAREL
800,000 Ushio 14,474
INDUSTRIAL LIGHT SOURCES
358,000 Eneserve 14,268
POWER GENERATORS
1,181,000 Toyo Technica 13,942
VALUE ADDED RESELLER OF IMPORTED INSTRUMENTATION
201,000 Kappa Create 13,930
201,000 Kappa Create New Shares 13,484
SUSHI CHAIN RESTAURANT OPERATOR
330,000 Sugi Pharmacy 13,506
DRUGSTORES
38
1-800-922-6769
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>JAPAN--CONTINUED
5,200 Dentsu $ 13,440
ADVERTISING AGENCY
817,500 NIFCO 12,936
MOLDED PLASTIC COMPONENTS
280,000 ARRK 12,265
PROTOTYPES & MOLDS FOR NEW PRODUCT DEVELOPMENT
226,000 Hogy Medical 11,359
DISPOSABLE SURGICAL PRODUCTS
75,000 Funai Electric 11,323
CONSUMER ELECTRONICS
442,500 Shimano 10,529
BICYCLE COMPONENTS & FISHING TACKLE
326,900 Otsuke Kagu 10,206
FURNITURE RETAILER
1,500,000 Bank of Fukuoka 8,921
REGIONAL BANK
1,400,000 Bank of Yokohama 8,769
REGIONAL BANK
172,000 Uni-Charm 8,569
INFANT HYGIENE & FEMININE CARE PRODUCTS
210,000 Park 24 7,988
PARKING LOT OPERATOR
234,900 Chiyoda Integre 7,232
PLASTIC COMPONENTS FOR CONSUMER ELECTRONICS
325,000 Olympus Optical 6,158
MEDICAL EQUIPMENT & CAMERAS
155,200 Ain Pharmaciez 2,716
DISPENSING PHARMACY/DRUGSTORE OPERATOR
112,000 Hiroshima Bank 599
REGIONAL BANK
- ----------------------------------------------------------------------------
268,898
>HONG KONG/CHINA: 5.1%
23,000,000 Global Bio-Chem Technology
Group (China) 16,705
1,875,000 Global Bio-Chem Technology
Group Warrant (China) (b) 123
CHINESE REFINER OF CORN-BASED COMMODITIES
6,000,000 Techtronic Industries 9,587
POWER TOOLS
2,000,000 Esprit Holdings 8,992
GLOBAL APPAREL BRAND MANAGER
4,000,000 Hong Kong Exchanges & Clearing 8,246
TRADING, CLEARING & SETTLEMENT SERVICES FOR
FINANCIAL MARKETS
9,815,000 Hainan Meilan Airport (China) 7,507
CHINESE AIRPORT OPERATOR
20,000,000 Sinotrans (China) 7,203
INTEGRATED LOGISTICS IN CHINA
17,674,000 Linmark 6,531
SOURCING OF CONSUMER GOODS
12,000,000 Jiangsu Expressway (China) 5,767
TOLL ROAD BUILDER & OPERATOR
8,000,000 Zhejiang Expressway (China) 5,720
TOLL ROAD BUILDER & OPERATOR
14,500,000 Ngai Lik Industrial 5,562
CHINA BASED ELECTRONICS CONTRACT MANUFACTURER
27,969,225 Lerado Group 4,958
BABY PARAPHERNALIA
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
930,000 Lianhua Supermarket $ 941
CHINESE SUPERMARKET CHAIN
108,300 TVB 467
TELEVISION PROGRAMMING & BROADCASTING
- ----------------------------------------------------------------------------
88,309
>TAIWAN: 2.5%
11,540,000 Phoenixtec Power 11,367
UNINTERRUPTIBLE POWER SUPPLIES
1,230,000 ASE Test (b) 9,065
SEMICONDUCTOR PACKAGING & TEST SERVICES
3,200,000 Springsoft Systems 7,343
ELECTRONIC DESIGN AUTOMATION SOFTWARE
5,000,000 Wah Lee Industrial 6,671
DISTRIBUTOR OF CHEMICALS, MATERIALS & EQUIPMENT
7,700,000 Bank of Kaohsiung 5,473
COMMERCIAL BANKING
3,010,000 Taiwan Fu Hsing 2,783
DOOR LOCK MANUFACTURER
- ----------------------------------------------------------------------------
42,702
>SINGAPORE: 2.3%
1,920,000 Venture 20,184
ELECTRONIC CONTRACT MANUFACTURER
15,000,000 Comfort Group 10,742
TAXI SERVICE
9,000,000 Sembcorp Logistics 9,637
LOGISTIC SERVICES FOR MARINE TRANSPORT
- ----------------------------------------------------------------------------
40,563
>SOUTH KOREA: 2.0%
355,000 Hyundai Mobis 15,815
AUTO PARTS
165,000 Yuhan 10,142
ETHICAL DRUG PRODUCER
100,000 Samsung Fire & Marine 6,410
NON-LIFE INSURANCE
252,100 Samyoung Heat Exchange (b) 2,253
POWER PLANT RELATED MACHINERY
- ----------------------------------------------------------------------------
34,620
>INDIA: 1.0%
1,500,000 Housing Development Finance 16,880
PREMIER MORTGAGE LENDER IN INDIA
- ----------------------------------------------------------------------------
>INDONESIA: 0.3%
40,000,000 PT Perusahaan Gas Negara 6,185
GAS PIPELINE OPERATOR
- ----------------------------------------------------------------------------
>THAILAND: 0.1%
4,000,000 Thai Union Frozen Products 2,005
CANNED TUNA FISH
- ----------------------------------------------------------------------------
-----------
ASIA: TOTAL 500,162
- ----------------------------------------------------------------------------
OTHER COUNTRIES: 7.8%
>CANADA: 3.9%
995,000 Talisman Energy 21,634
OIL & GAS PRODUCER
5,000,000 Esprit Exploration (b) 13,038
NATURAL GAS PRODUCER
39
COLUMBIA ACORN INTERNATIONAL
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>CANADA--CONTINUED
500,000 Corus Entertainment $ 9,694
TELEVISION PROGRAMMING & RADIO STATIONS
340,000 Masonite International (b) 8,769
DOOR MANUFACTURER
450,000 Intrawest 7,178
OWNER/OPERATOR OF SKI RESORTS
400,000 Noranda 6,856
DIVERSIFIED NON-FERROUS METALS MINER
- ----------------------------------------------------------------------------
67,169
>AUSTRALIA/NEW ZEALAND: 3.6%
3,000,000 Billabong International 17,219
SURFWEAR APPAREL MANUFACTURER
4,000,000 Sky City Entertainment (New Zealand) 12,114
CASINO/ENTERTAINMENT COMPLEX
2,500,000 Lion Nathan 11,778
AUSTRALIAN BEER BREWER/DISTRIBUTOR
350,000 Perpetual Trustees 11,429
AUSTRALIAN MUTUAL FUND MANAGER
5,000,000 Pacific Brands (b) 9,274
DOMINANT AUSTRALIAN APPAREL BRAND MANAGER
- ----------------------------------------------------------------------------
61,814
>SOUTH AFRICA: 0.3%
252,000 Edgars Consolidated Stores 5,986
LEADING RETAIL CONGLOMERATE
- ----------------------------------------------------------------------------
-----------
OTHER: TOTAL 134,969
- ----------------------------------------------------------------------------
LATIN AMERICA: 3.1%
>MEXICO: 1.4%
660,000 Grupo Aeroportuario 12,210
MEXICAN AIRPORT AUTHORITY
3,000,000 Consorcio (b) 8,634
LOW/MEDIUM INCOME HOUSE BUILDER
690,000 URBI Desarrollo (b) 2,228
AFFORDABLE HOUSING BUILDER
- ----------------------------------------------------------------------------
23,072
NUMBER OF SHARES OR
PRINCIPAL AMOUNT (000) VALUE (000)
- ----------------------------------------------------------------------------
>ARGENTINA: 0.8%
440,000 Tenaris $ 14,410
STEEL PIPE FOR OIL WELLS & PIPELINES
- ----------------------------------------------------------------------------
>BRAZIL: 0.5%
517,000 Natura Cosmetics (b) 8,315
DIRECT SALES OF HIGH-END COSMETICS
- ----------------------------------------------------------------------------
>CHILE: 0.4%
300,000 CorpBanca (c) 7,170
CHILE'S 3RD LARGEST LOCAL BANK
- ----------------------------------------------------------------------------
-----------
LATIN AMERICA: TOTAL 52,967
TOTAL COMMON STOCKS AND OTHER -----------
EQUITY-LIKE SECURITIES: 96.8% 1,673,727
(COST: $1,193,325)
- ----------------------------------------------------------------------------
SHORT-TERM OBLIGATIONS: 3.2%
Yield 1.17% - 1.22%
Due 7/6/04 - 7/7/04
$ 30,000 SBC International 29,995
25,000 American General Finance 24,995
- ----------------------------------------------------------------------------
(AMORTIZED COST: $54,990) 54,990
-----------
TOTAL INVESTMENTS (d): 100.0% 1,728,717
(COST: $1,248,315) (a)
CASH AND OTHER ASSETS LESS LIABILITIES: 0.0% (531)
-----------
TOTAL NET ASSETS: 100% $ 1,728,186
============================================================================
- --------------------------------------------------------------------------------
>NOTES TO STATEMENT OF INVESTMENTS (IN THOUSANDS)
(a) At June 30, 2004, for federal income tax purpose cost of investments was
$1,249,530 and net unrealized appreciation was $479,187 consisting of gross
unrealized appreciation of $512,988 and gross unrealized depreciation of
$33,801.
(b) Non-income producing security.
(c) Denotes a restricted security, which is subject to restrictions on resale
under federal securities laws. This security amounted to $7,170, which
represents 0.40% of total net assets.
Additional information on this security is as follows:
ACQUISITION
SECURITY DATE SHARES (000) COST (000) VALUE (000)
- -------- ----------- ----------- ---------- -----------
CorpBanca 11/19/03 300 $ 7,564 $ 7,170
(d) On June 30, 2004, the Fund's total investments were denominated in
currencies as follows:
CURRENCY VALUE % OF NET ASSETS
------------- ------------ ---------------
Euro $ 625,619 36.2%
Japanese Yen 268,898 15.6
British Pounds 198,688 11.5
US Dollar 103,220 5.9
Hong Kong Dollar 88,309 5.1
Other currencies less than
5% of total net assets 443,983 25.7
------------ ---------------
$ 1,728,717 100.0%
============ ===============
40
1-800-922-6769
COLUMBIA ACORN INTERNATIONAL
>PORTFOLIO DIVERSIFICATION (UNAUDITED)
At June 30, 2004, the Fund's portfolio investments as a percent of net assets
was diversified as follows:
VALUE (000) PERCENT
------------ -----------
>INDUSTRIAL GOODS/SERVICES
Other Industrial Services $ 103,277 5.8%
Industrial Materials 81,897 4.7
Outsourcing and
Training Services 61,139 3.5
Conglomerates 55,262 3.2
Electrical Components 49,480 2.9
Construction 37,728 2.2
Machinery 27,664 1.6
Steel 23,257 1.3
Industrial Distribution 21,943 1.3
Specialty Chemicals 21,909 1.3
- ----------------------------------------------------------------------------
480,556 27.8
>CONSUMER GOODS/SERVICES
Retail 85,373 4.9
Apparels 61,438 3.6
Food 50,213 2.9
Restaurants 43,449 2.5
Furniture and Textiles 40,397 2.3
Durables Goods 25,868 1.5
Beverage 22,242 1.3
Leisure Products 17,955 1.0
Travel 17,442 1.0
Casinos 13,372 0.8
Other Consumer Services 12,946 0.8
Consumer Electronics 11,323 0.7
Nondurables 8,569 0.5
Gaming 7,393 0.4
Other Entertainment 7,062 0.4
Consumer Goods Distribution 5,375 0.3
- ----------------------------------------------------------------------------
430,417 24.9
>FINANCE
Banks 103,539 6.0
Other Finance Companies 39,164 2.3
Insurance 30,117 1.7
Savings and Loans 21,453 1.2
Money Management 14,805 0.9
- ----------------------------------------------------------------------------
209,078 12.1
VALUE (000) PERCENT
------------ -----------
>INFORMATION TECHNOLOGY
Business Information and
Marketing Services $ 34,384 2.0%
Contract Manufacturing 25,746 1.5
Instrumentation 24,825 1.4
Satellite Broadcasting Services 15,893 0.9
Computer Hardware and
Related Equipment 15,004 0.9
Advertising 13,440 0.8
Television Broadcasting 10,918 0.6
Television Programming 9,694 0.6
Business Software 9,565 0.5
Semiconductors and
Related Equipment 9,065 0.5
Financial Processors 8,246 0.5
Electronics Distribution 6,671 0.4
- ----------------------------------------------------------------------------
183,451 10.6
>HEALTH CARE
Medical Equipment 45,784 2.6
Hospital Management 33,435 1.9
Services 29,882 1.7
Pharmaceuticals 20,188 1.2
Hospital/ Laboratory Supplies 11,359 0.7
Biotechnology/ Drug Delivery 6,286 0.4
- ----------------------------------------------------------------------------
146,934 8.5
>ENERGY/MINERALS
Oil/Gas Producers 55,222 3.2
Oil Services 29,947 1.7
Agricultural Commodities 16,828 1.0
Independent Power 14,268 0.8
Non-Ferrous Metals 10,049 0.6
Mining 6,856 0.4
Refining/Marketing/Distribution 6,185 0.4
- ----------------------------------------------------------------------------
139,355 8.1
>OTHER INDUSTRIES
Transportation 51,425 3.0
Real Estate 25,360 1.4
Regulated Utilities 7,151 0.4
- ----------------------------------------------------------------------------
83,936 4.8
TOTAL COMMON STOCKS AND ------------ -----------
OTHER EQUITY-LIKE SECURITIES 1,673,727 96.8
SHORT-TERM OBLIGATIONS 54,990 3.2
------------ -----------
TOTAL INVESTMENTS 1,728,717 100.0
CASH AND OTHER ASSETS
LESS LIABILITIES (531) 0.0
------------ -----------
NET ASSETS $ 1,728,186 100.0%
============================================================================
41
COLUMBIA ACORN USA
>MAJOR PORTFOLIO CHANGES IN THE SECOND QUARTER (UNAUDITED)
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
ADDITIONS
- ----------------------------------------------------------------------------
INFORMATION
Entravision Communications 0 510,000
Unova 180,000 260,000
ValueClick 140,000 285,000
- ----------------------------------------------------------------------------
CONSUMER GOODS/SERVICES
Aeropostale 290,500 435,750
Ann Taylor 75,000 187,500
(INCLUDES THE EFFECT OF A 3 FOR 2 STOCK SPLIT)
Brookstone 12,750 129,900
(INCLUDES THE EFFECT OF A 3 FOR 2 STOCK SPLIT)
HNI 0 40,000
ITT Educational Services 376,000 396,000
NBTY 0 37,000
Sports Authority 0 70,000
Weight Watchers 0 60,000
- ----------------------------------------------------------------------------
HEALTH CARE
Atherogenics 0 260,000
Diagnostic Products 66,300 141,300
Lexicon Genetics 0 281,200
Ligand Pharmaceuticals 0 415,000
Par Pharmaceuticals 0 192,000
- ----------------------------------------------------------------------------
ENERGY/MINERALS
Chicago Bridge & Iron 0 160,000
Clayton Williams Energy 0 95,000
Oneok 95,000 245,000
Range Resources 0 73,000
- ----------------------------------------------------------------------------
INDUSTRIAL GOODS/SERVICES
Genlyte Group 0 17,000
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
SALES
- ----------------------------------------------------------------------------
INFORMATION
DoubleClick 925,600 460,600
Kronos 331,650 296,650
Micros Systems 347,600 287,600
Telephone & Data Systems 40,000 10,000
Zebra Technologies 186,000 166,000
- ----------------------------------------------------------------------------
HEALTH CARE
Applera Celera Genomics 245,000 0
Enzon 311,500 0
Nektar Therapeutics 720,000 360,000
- ----------------------------------------------------------------------------
INDUSTRIAL GOODS/SERVICES
Insurance Auto Auctions 206,900 41,900
42
1-800-922-6769
COLUMBIA ACORN USA
>STATEMENT OF INVESTMENTS (UNAUDITED), JUNE 30, 2004
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
COMMON STOCKS: 92.0%
- ----------------------------------------------------------------------------
INFORMATION: 33.9%
>BUSINESS/CONSUMER SOFTWARE: 9.9%
287,600 Micros Systems (b) $ 13,796
INFORMATION SYSTEMS FOR RESTAURANTS & HOTELS
974,000 JDA Software (b) 12,828
APPLICATIONS/SOFTWARE & SERVICES FOR RETAILERS
296,650 Kronos (b) 12,222
LABOR MANAGEMENT SOLUTIONS
1,330,000 Novell (b) 11,159
DIRECTORY, OPERATING SYSTEM & IDENTITY
MANAGEMENT SOFTWARE
473,500 MRO Software (b) 6,444
ENTERPRISE MAINTENANCE SOFTWARE
304,991 PeopleSoft (b) 5,642
HR, ERP, CRM & SUPPLY CHAIN SOFTWARE
206,000 Group 1 Software (b) 4,728
ADDRESS VERIFICATION SOFTWARE
653,200 E.Piphany (b) 3,155
CRM SOFTWARE
140,000 SPSS (b) 2,516
STATISTICAL ANALYSIS SOFTWARE
64,000 THQ (b) 1,466
ENTERTAINMENT SOFTWARE
100,000 Aspect Communications (b) 1,420
CALL CENTER SOFTWARE
65,000 MAPICS (b) 686
MID MARKET ERP SOFTWARE
- ----------------------------------------------------------------------------
76,062
>COMPUTER HARDWARE/SEMICONDUCTORS/
RELATED EQUIPMENT: 6.1%
166,000 Zebra Technologies (b) 14,442
BAR CODE PRINTERS
365,300 Integrated Circuit Systems (b) 9,922
SILICON TIMING DEVICES
424,100 Seachange International (b) 7,159
SYSTEMS FOR VIDEO ON DEMAND & AD INSERTION
260,000 Unova (b) 5,265
BARCODE & WIRELESS LAN SYSTEMS
70,000 Littelfuse (b) 2,969
LITTLE FUSES
40,000 Rogers (b) 2,796
PCB LAMINATES & HIGH PERFORMANCE FOAMS
200,000 Cable Design Technologies (b) 2,120
NETWORKING & SPECIALTY CABLES
50,000 Avocent (b) 1,837
COMPUTER CONTROL SWITCHES
- ----------------------------------------------------------------------------
46,510
>MOBILE COMMUNICATIONS: 5.5%
927,000 Western Wireless (b) 26,800
RURAL CELLULAR PHONE SERVICES
1,005,000 Crown Castle International (b) 14,824
COMMUNICATION TOWERS IN USA & UK
10,000 Telephone & Data Systems 712
CELLULAR & TELEPHONE SERVICES
- ----------------------------------------------------------------------------
42,336
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>TELECOMMUNICATIONS/WIRELINE
COMMUNICATIONS: 3.2%
333,800 Commonwealth Telephone (b) $ 14,944
RURAL PHONE FRANCHISES & CLEC
480,000 Andrew (b) 9,605
WIRELESS INFRASTRUCTURE EQUIPMENT
- ----------------------------------------------------------------------------
24,549
>BROADCASTING: 2.7%
315,800 Salem Communications (b) 8,568
RADIO STATIONS FOR RELIGIOUS PROGRAMMING
695,000 Spanish Broadcasting (b) 6,470
SPANISH LANGUAGE RADIO STATIONS
510,000 Entravision Communications (b) 3,917
SPANISH LANGUAGE TV, RADIO & OUTDOOR
138,500 Gray Television 1,924
MID MARKET AFFILIATED TV STATIONS
- ----------------------------------------------------------------------------
20,879
>TRANSACTION PROCESSORS: 1.7%
211,640 Global Payments 9,528
CREDIT CARD PROCESSOR
143,100 Pegasus Systems (b) 1,878
TRANSACTION PROCESSOR FOR HOTEL INDUSTRY
80,000 Euronet Worldwide (b) 1,850
ATM PROCESSOR
- ----------------------------------------------------------------------------
13,256
>COMPUTER SERVICES: 1.5%
1,005,500 AnswerThink Consulting (b) 5,761
IT INTEGRATOR FOR FORTUNE 2000
786,000 RCM Technologies (b)(c) 4,990
TECHNOLOGY ENGINEERING SERVICES
200,000 Igate Capital (b) 796
TECHNOLOGY STAFFING SERVICES
- ----------------------------------------------------------------------------
11,547
>INTERNET: 0.9%
460,600 DoubleClick (b) 3,579
INTERNET ADVERTISING & DIRECT MARKETING STATISTICAL DATA
285,000 ValueClick (b) 3,414
INTERNET ADVERTISING
- ----------------------------------------------------------------------------
6,993
>BUSINESS INFORMATION/MARKETING
SERVICES/PUBLISHING: 0.8%
102,800 Getty Images (b) 6,168
PHOTOGRAPHS FOR PUBLICATIONS & ELECTRONIC MEDIA
- ----------------------------------------------------------------------------
>TELEVISION PROGRAMMING: 0.6%
600,000 Mediacom Communications (b) 4,692
CABLE TELEVISION FRANCHISES
- ----------------------------------------------------------------------------
>TELECOMMUNICATION EQUIPMENT: 0.4%
300,000 Symmetricom (b) 2,670
NETWORK TIMING & SYNCHRONIZATION DEVICES
- ----------------------------------------------------------------------------
>INSTRUMENTATION: 0.3%
90,000 Trimble Navigation (b) 2,501
GPS-BASED INSTRUMENTS
- ----------------------------------------------------------------------------
43
COLUMBIA ACORN USA
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>CONTRACT MANUFACTURING: 0.3%
140,000 Plexus (b) $ 1,890
ELECTRONIC MANUFACTURING SERVICES
- ----------------------------------------------------------------------------
-----------
INFORMATION: TOTAL 260,053
- ----------------------------------------------------------------------------
CONSUMER GOODS/SERVICES: 15.4%
>RETAIL: 7.0%
435,750 Aeropostale (b) 11,726
MALL BASED TEEN RETAILER
116,600 Urban Outfitters (b) 7,102
MULTI CHANNEL LIFESTYLE RETAILER
343,750 Christopher & Banks 6,088
WOMEN'S APPAREL RETAILER
187,500 Ann Taylor (b) 5,434
WOMEN'S APPAREL RETAILER
710,000 Winn Dixie Stores 5,112
SUPERMARKETS IN THE SOUTHEAST US
130,000 Abercrombie & Fitch 5,037
TEEN APPAREL RETAILER
95,000 Petco Animal Supplies (b) 3,060
PET SUPPLIES & SERVICES
50,000 Michaels Stores 2,750
CRAFT & HOBBY SPECIALTY RETAILER
129,900 Brookstone (b) 2,604
SPECIALTY CONSUMER PRODUCT RETAILER
70,000 Sports Authority (b) 2,513
SPORTING GOODS STORES
95,000 Genesco (b) 2,245
MULTI-CONCEPT BRANDED FOOTWEAR RETAILER
- ----------------------------------------------------------------------------
53,671
>CONSUMER SERVICES: 4.0%
396,000 ITT Educational Services (b) 15,056
TECHNOLOGY-ORIENTED POST SECONDARY DEGREE PROGRAMS
435,000 Coinstar (b) 9,557
OWNER/OPERATOR OF COIN COUNTING MACHINES
181,700 Central Parking 3,396
OWNER, OPERATOR & MANAGER OF PARKING LOTS & GARAGES
60,000 Weight Watchers 2,348
WEIGHT LOSS PROGRAMS
- ----------------------------------------------------------------------------
30,357
>NONDURABLES: 1.4%
167,200 Scotts Company (b) 10,681
CONSUMER LAWN & GARDEN PRODUCTS
- ----------------------------------------------------------------------------
>APPAREL: 1.2%
197,600 Steven Madden (b) 3,946
WHOLESALER/RETAILER OF FASHION FOOTWEAR
64,000 Coach (b) 2,892
DESIGNER & RETAILER OF BRANDED LEATHER ACCESSORIES
59,200 Oxford Industries 2,579
BRANDED & PRIVATE LABEL APPAREL
- ----------------------------------------------------------------------------
9,417
>FURNITURE: 1.0%
85,000 Herman Miller 2,460
OFFICE FURNITURE
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
30,000 American Woodmark $ 1,795
KITCHEN CABINETS
40,000 HNI 1,693
OFFICE FURNITURE & FIREPLACES
20,000 Mohawk Industries (b) 1,467
CARPET & FLOORING
- ----------------------------------------------------------------------------
7,415
>ENTERTAINMENT/LEISURE PRODUCTS: 0.7%
91,300 International Speedway Motors 4,441
LARGEST MOTORSPORT RACETRACK OWNER & OPERATOR
50,000 Leapfrog Enterprises (b) 994
EDUCATIONAL TOYS
- ----------------------------------------------------------------------------
5,435
>FOOD & BEVERAGES: 0.1%
37,000 NBTY (b) 1,087
VITAMINS & SUPPLEMENTS
- ----------------------------------------------------------------------------
-----------
CONSUMER GOODS/SERVICES: TOTAL 118,063
- ----------------------------------------------------------------------------
HEALTH CARE: 15.1%
>MEDICAL EQUIPMENT: 6.5%
573,000 Edwards Lifesciences (b) 19,970
HEART VALVES
415,000 Ligand Pharmaceuticals (b) 7,213
DRUGS FOR PAIN, CANCER, OSTEOPOROSIS, & DIABETES
141,300 Diagnostic Products 6,209
IMMUNODIAGNOSTIC KITS
220,000 Viasys Healthcare (b) 4,600
RESPIRATORY & NEUROLOGY MEDICAL EQUIPMENT
170,600 VISX (b) 4,558
LASER EYE SURGERY
111,700 ICU Medical (b) 3,745
INTRAVENOUS THERAPY PRODUCTS
245,000 CTI Molecular Imaging (b) 3,474
MEDICAL DIAGNOSTIC DEVICES
- ----------------------------------------------------------------------------
49,769
>SERVICES: 4.3%
744,000 First Health (b) 11,614
PPO NETWORK
423,800 NDCHealth Group 9,832
HEALTH CLAIMS PROCESSING & DRUG MARKETING SERVICES
246,800 Lincare Holdings (b) 8,110
HOME HEALTH CARE SERVICES
40,000 Charles River Laboratories (b) 1,955
PHARMACEUTICAL RESEARCH
100,000 Dendrite International (b) 1,858
SOFTWARE FOR PHARMACEUTICAL SALES FORCE
- ----------------------------------------------------------------------------
33,369
>BIOTECHNOLOGY/DRUG DELIVERY: 3.0%
360,000 Nektar Therapeutics (b) 7,186
DRUG DELIVERY TECHNOLOGIES
192,000 Par Pharmaceuticals (b) 6,760
GENERICS
260,000 Atherogenics (b) 4,948
DRUGS FOR ATHEROSCLEROSIS, RHEUMATOID ARTHRITIS, ASTHMA
44
1-800-922-6769
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>BIOTECHNOLOGY/DRUG DELIVERY--CONTINUED
281,200 Lexicon Genetics (b) $ 2,205
DRUG DISCOVERY
154,000 SYRRX, Series C (b)(d) 770
X-RAY CRYSTALLOGRAPHY
375,000 Locus Discovery, Series D, Pfd. (b)(d) 750
HIGH THROUGHPUT RATIONAL DRUG DESIGN
75,000 Bioveris (b) 624
IMMUNODIAGNOSTIC TECHNOLOGY
363,636 Metabolex, Series F (b)(d) 53
DRUGS FOR DIABETES
- ----------------------------------------------------------------------------
23,296
>MEDICAL SUPPLIES: 1.3%
222,800 Techne (b) 9,681
CYTOKINES, ANTIBODIES, OTHER REAGENTS FOR LIFE SCIENCES
- ----------------------------------------------------------------------------
-----------
HEALTH CARE: TOTAL 116,115
- ----------------------------------------------------------------------------
ENERGY/MINERALS: 10.3%
>OIL & GAS PRODUCERS: 4.6%
305,000 Quicksilver (b) 20,456
NATURAL GAS & COAL SEAM GAS PRODUCER
272,000 Western Gas 8,835
OIL & COAL SEAM GAS PRODUCER
82,100 Southwestern Energy (b) 2,354
NATURAL GAS PRODUCER
95,000 Clayton Williams Energy (b) 2,270
OIL & GAS PRODUCER
73,000 Range Resources 1,066
OIL & GAS PRODUCER
43,300 McMoRan Exploration (b) 675
NATURAL GAS PRODUCERS & LNG DEVELOPER
- ----------------------------------------------------------------------------
35,656
>OIL SERVICES: 3.6%
401,700 FMC Technologies (b) 11,569
OIL & GAS WELL HEAD MANUFACTURER
941,000 Newpark Resources (b) 5,834
DRILLING FLUID SERVICES TO OIL & GAS INDUSTRY
160,000 Chicago Bridge & Iron 4,456
ENGINEERING & CONSTRUCTION FOR PETROCHEMICALS & LNG
61,000 Carbo Ceramics 4,163
NATURAL GAS WELL STIMULANTS
135,000 Key Energy Services (b) 1,274
OIL & GAS WELL WORKOVER SERVICES
- ----------------------------------------------------------------------------
27,296
>DISTRIBUTION/MARKETING/REFINING: 2.1%
115,600 Equitable Resources 5,978
NATURAL GAS UTILITY & PRODUCER
245,000 Oneok 5,388
NATURAL GAS UTILITY, MARKETING & PROCESSING
193,000 Atmos Energy 4,941
NATURAL GAS UTILITY
- ----------------------------------------------------------------------------
16,307
-----------
ENERGY/MINERALS: TOTAL 79,259
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
FINANCE: 9.8%
>FINANCE COMPANIES: 4.0%
1,091,500 AmeriCredit (b) $ 21,317
AUTO LENDING
520,200 World Acceptance (b) 9,535
PERSONAL LOANS
- ----------------------------------------------------------------------------
30,852
>INSURANCE: 2.9%
430,000 HCC Insurance Holdings 14,367
AVIATION INSURANCE
16,500 Markel (b) 4,579
SPECIALTY INSURANCE
35,000 Philadelphia Consolidated Holding (b) 2,102
SPECIALTY INSURANCE
91,000 United National Group (b) 1,375
SPECIALTY INSURANCE
- ----------------------------------------------------------------------------
22,423
>BANKS: 1.7%
131,500 TCF Financial 7,634
GREAT LAKES BANK
158,125 Chittenden 5,558
VERMONT & WEST MASSACHUSETTS BANK
- ----------------------------------------------------------------------------
13,192
>SAVINGS & LOAN: 1.2%
110,000 Downey Financial 5,857
CALIFORNIA HOME LENDER
116,400 Anchor Bancorp Wisconsin 3,078
WISCONSIN THRIFT
- ----------------------------------------------------------------------------
8,935
-----------
FINANCE: TOTAL 75,402
- ----------------------------------------------------------------------------
INDUSTRIAL GOODS/SERVICES: 6.7%
>MACHINERY: 3.3%
282,000 Esco Technologies (b) 15,047
FILTRATION & TEST EQUIPMENT
194,000 Pentair 6,526
PUMPS, WATER TREATMENT & TOOLS
110,000 Ametek 3,399
AEROSPACE/INDUSTRIAL INSTRUMENTS
- ----------------------------------------------------------------------------
24,972
>LOGISTICS: 1.3%
286,000 Hub Group (b) 9,753
TRUCK & RAIL FREIGHT FORWARDER
- ----------------------------------------------------------------------------
>WATER: 0.9%
134,000 Cuno (b) 7,149
FILTRATION & FLUIDS CLARIFICATION
- ----------------------------------------------------------------------------
>INDUSTRIAL SERVICES: 0.3%
95,000 Clark/Bardes Consulting (b) 1,762
EXECUTIVE COMPENSATION & BENEFITS CONSULTING
41,900 Insurance Auto Auctions (b) 712
AUTO SALVAGE SERVICES
- ----------------------------------------------------------------------------
2,474
45
COLUMBIA ACORN USA
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>SPECIALTY CHEMICALS/INDUSTRIAL
MATERIALS: 0.3%
95,000 Spartech $ 2,464
PLASTICS DISTRIBUTION & COMPOUNDING
- ----------------------------------------------------------------------------
>INDUSTRIAL DISTRIBUTION: 0.3%
100,000 Nuco2 (b) 1,970
BULK CO2 GAS DISTRIBUTION TO RESTAURANTS
- ----------------------------------------------------------------------------
>CONSTRUCTION: 0.2%
45,000 Florida Rock Industries 1,898
CONCRETE & AGGREGATES
- ----------------------------------------------------------------------------
>INDUSTRIAL GOODS: 0.1%
17,000 Genlyte Group (b) 1,069
COMMERCIAL LIGHTING FIXTURES
- ----------------------------------------------------------------------------
-----------
INDUSTRIAL GOODS/SERVICES: TOTAL 51,749
- ----------------------------------------------------------------------------
OTHER INDUSTRIES: 0.8%
>REAL ESTATE: 0.6%
47,000 The Rouse Company 2,232
REGIONAL SHOPPING MALLS
100,000 Crescent Real Estate Equities 1,612
CLASS A OFFICE BUILDINGS
35,000 Highland Hospitality (b) 352
HOTEL REAL ESTATE INVESTMENT TRUST
- ----------------------------------------------------------------------------
4,196
>REGULATED UTILITIES: 0.2%
90,000 Northeast Utilities 1,752
REGULATED ELECTRIC UTILITY
- ----------------------------------------------------------------------------
-----------
OTHER INDUSTRIES: TOTAL 5,948
-----------
TOTAL COMMON STOCKS: 92.0% 706,589
(COST: $486,876)
PRINCIPAL AMOUNT (000) VALUE (000)
- ----------------------------------------------------------------------------
SHORT-TERM OBLIGATIONS: 8.0%
Yield 1.12% - 1.17%
Due 7/6/04 - 7/7/04
$ 20,000 SBC International $ 19,997
20,000 Prudential Funding 19,996
21,514 Repurchase Agreement with
State Street Bank & Trust
Dated 6/30/04, Due 7/01/04
at 1.30% Collateralized by
Federal Home Loan Mortgage
Corporation Notes, Maturing
2/15/05, Market Value $21,945
(Repurchase proceeds: $21,515) 21,514
- ----------------------------------------------------------------------------
(AMORTIZED COST: $61,507) 61,507
-----------
TOTAL INVESTMENTS: 100.0% 768,096
(COST: $548,383) (a)
CASH AND OTHER ASSETS LESS LIABILITIES: 0.0% (180)
-----------
TOTAL NET ASSETS: 100% $ 767,916
============================================================================
46
1-800-922-6769
- --------------------------------------------------------------------------------
>NOTES TO STATEMENT OF INVESTMENTS (IN THOUSANDS)
(a) At June 30, 2004, for federal income tax purposes cost of investments was
the same and net unrealized appreciation was $219,713 consisting of gross
unrealized appreciation of $242,584 and gross unrealized depreciation of
$22,871.
(b) Non-income producing security.
(c) An affiliate may include any company in which the Fund owns five percent or
more of its outstanding voting securities. On June 30, 2004, the Fund held
five percent or more of the outstanding voting securities of the following
company:
RCM Technologies 6.95%
The aggregate cost and value of this company at June 30, 2004, was $5,636
and $4,990 respectively. Investments in affiliate companies represent 0.65%
of total net assets at June 30, 2004. Investment activity and income amounts
relating to affiliates during the six months ended June 30, 2004 were as
follows:
Dividend Income $ --
Net realized gain or loss $ (3,800)
Change in unrealized gain or loss $ (2,712)
Purchases $ --
Proceeds from sales $ 562
(d) Denotes a restricted security, which is subject to restrictions on resale
under federal securities laws. These securities are valued in good faith by
the Board of Trustees. At June 30, 2004, these securities amounted to
$1,573, which represents 0.20% of total net assets.
Additional information on these securities is as follows:
ACQUISITION
SECURITY DATES SHARES (000) COST (000) VALUE (000)
- -------- ----------- ------------ ---------- ----------
SYRRX, Series C 01/08/01 154 $ 1,101 $ 770
Locus Discovery, Series D, Pfd. 09/05/01 375 1,500 750
Metabolex, Series F 05/11/00 364 2,000 53
----------- ----------
$ 4,601 $ 1,573
=========== ==========
47
COLUMBIA ACORN INTERNATIONAL SELECT
>MAJOR PORTFOLIO CHANGES IN THE SECOND QUARTER (UNAUDITED)
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
ADDITIONS
- ----------------------------------------------------------------------------
EUROPE
>UNITED KINGDOM
British Sky Broadcasting 35,000 70,000
Exel 80,000 135,000
>CZECH REPUBLIC
Komercni Banka 0 12,000
- ----------------------------------------------------------------------------
ASIA
>JAPAN
Daito Trust Construction 26,100 38,000
Olympus Optical 0 23,000
Sugi Pharmacy 23,000 32,300
Uni-Charm 20,500 25,100
- ----------------------------------------------------------------------------
OTHER COUNTRIES
>CANADA
Kinross Gold 0 80,000
- ----------------------------------------------------------------------------
LATIN AMERICA
>ARGENTINA
Tenaris 19,200 39,200
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
SALES
- ----------------------------------------------------------------------------
EUROPE
>UNITED KINGDOM
BG Group 350,000 270,000
>FRANCE
Essilor International 18,000 12,000
Neopost 33,600 25,100
>SWEDEN
Gambro 58,000 0
- ----------------------------------------------------------------------------
ASIA
>JAPAN
Fast Retailing 19,500 11,500
Nidec 12,900 0
USS 11,700 0
>HONG KONG/CHINA
Esprit Holdings 200,000 0
Sinotrans (China) 2,000,000 0
- ----------------------------------------------------------------------------
OTHER COUNTRIES
>CANADA
Power Financial 20,000 0
Talisman Energy 72,000 52,000
(INCLUDES THE EFFECT OF A 3 FOR 1 STOCK SPLIT)
48
1-800-922-6769
COLUMBIA ACORN INTERNATIONAL SELECT
>STATEMENT OF INVESTMENTS (UNAUDITED) JUNE 30, 2004
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
COMMON STOCKS: 96.8%
- ----------------------------------------------------------------------------
EUROPE: 56.3%
>UNITED KINGDOM/IRELAND: 29.7%
161,486 Anglo Irish Bank (Ireland) $ 2,530
SMALL BUSINESS & MIDDLE MARKET BANKING
135,000 Exel 1,882
GLOBAL LOGISTICS & FREIGHT FORWARDING
270,000 BG Group 1,667
OIL & GAS PRODUCER
88,000 Depfa Bank (Ireland) 1,285
INTERNATIONAL PUBLIC SECTOR FINANCE
40,000 Cobham 1,015
AEROSPACE
120,000 Grafton Group (Ireland) 957
BUILDERS, WHOLESALERS & DIY RETAILING
70,000 British Sky Broadcasting (b) 792
DIGITAL SATELLITE BROADCASTING
100,000 Jardine Lloyd Thompson 745
BUSINESS INSURANCE BROKER
120,000 Compass Group 735
INTERNATIONAL CONCESSION & CONTRACT CATERER
75,000 Burberry 557
APPAREL RETAILER
25,000 Kerry (Ireland) 530
FOOD INGREDIENTS
46,000 Smith & Nephew 496
MEDICAL EQUIPMENT & SUPPLIES
15,400 Rank Group 84
GAMING & MEDIA SERVICES
- ----------------------------------------------------------------------------
13,275
>SWITZERLAND: 7.2%
4,000 Schindler 1,149
ELEVATOR MANUFACTURER & SERVICE PROVIDER
7,000 Swatch Group 913
WATCH & ELECTRONICS MANUFACTURER
1,000 Givaudan 580
INDUSTRIAL FRAGRANCES & FLAVORS
5,000 Synthes-Stratec 570
PRODUCTS FOR ORTHOPEDIC SURGERY
- ----------------------------------------------------------------------------
3,212
>FRANCE: 6.1%
25,100 Neopost 1,485
POSTAGE METERS
12,000 Essilor International 784
EYEGLASS LENSES
8,000 Imerys 466
INDUSTRIAL MINERALS PRODUCER
- ----------------------------------------------------------------------------
2,735
>NORWAY: 3.2%
209,500 Den Norske Bank 1,429
LARGEST NORWEGIAN BANK
- ----------------------------------------------------------------------------
>CZECH REPUBLIC: 3.0%
12,000 Komercni Banka 1,346
LEADING CZECH UNIVERSAL BANK
- ----------------------------------------------------------------------------
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>GERMANY: 2.5%
20,000 Rhoen-Klinikum $ 1,099
HOSPITAL MANAGEMENT
- ----------------------------------------------------------------------------
>SPAIN: 1.8%
43,000 Red Electrica 732
SPANISH POWER GRID
6,000 Gestevis Telecino (b) 90
SPAIN'S SECOND LARGEST BROADCASTER
- ----------------------------------------------------------------------------
822
>LUXEMBOURG: 1.7%
90,000 SES Global 761
SATELLITE BROADCASTING SERVICES
- ----------------------------------------------------------------------------
>ITALY: 1.1%
34,000 Autogrill (b) 482
RESTAURANTS & CATERING FOR TRAVELERS
- ----------------------------------------------------------------------------
-----------
EUROPE: TOTAL 25,161
- ----------------------------------------------------------------------------
ASIA: 29.4%
>JAPAN: 25.8%
9,700 Funai Electric 1,464
CONSUMER ELECTRONICS
38,000 Daito Trust Construction 1,461
APARTMENT BUILDER
32,300 Sugi Pharmacy 1,322
DRUGSTORES
12,400 Hoya 1,301
OPTO-ELECTRICAL COMPONENTS & EYEGLASS LENSES
71,000 Ushio 1,285
INDUSTRIAL LIGHT SOURCES
25,100 Uni-Charm 1,251
INFANT HYGIENE & FEMININE CARE PRODUCTS
51,500 Shimano 1,225
BICYCLE COMPONENTS & FISHING TACKLE
11,500 Fast Retailing 934
APPAREL RETAILER
310 Dentsu 801
ADVERTISING AGENCY
23,000 Olympus Optical 436
MEDICAL EQUIPMENT & CAMERAS
11,000 Hiroshima Bank 59
REGIONAL BANK
- ----------------------------------------------------------------------------
11,539
>SINGAPORE: 2.0%
83,000 Venture 873
ELECTRONIC CONTRACT MANUFACTURER
- ----------------------------------------------------------------------------
>HONG KONG: 1.6%
500,000 Li & Fung 733
SOURCING OF CONSUMER GOODS
- ----------------------------------------------------------------------------
-----------
ASIA: TOTAL 13,145
49
COLUMBIA ACORN INTERNATIONAL SELECT
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
OTHER COUNTRIES: 8.2%
>CANADA: 5.5%
52,000 Talisman Energy $ 1,131
OIL & GAS PRODUCER
50,000 Noranda 857
DIVERSIFIED NON-FERROUS METALS MINER
80,000 Kinross Gold (b) 444
GOLD MINING
- ----------------------------------------------------------------------------
2,432
>AUSTRALIA: 2.7%
260,000 Lion Nathan 1,225
BEER BREWER/DISTRIBUTOR
- ----------------------------------------------------------------------------
-----------
OTHER COUNTRIES: TOTAL 3,657
- ----------------------------------------------------------------------------
LATIN AMERICA: 2.9%
>ARGENTINA: 2.9%
39,200 Tenaris 1,284
STEEL PIPE FOR OIL WELLS & PIPELINES
- ----------------------------------------------------------------------------
-----------
LATIN AMERICA: TOTAL 1,284
-----------
TOTAL COMMON STOCKS: 96.8% 43,247
(COST: $32,172)
PRINCIPAL AMOUNT (000) VALUE (000)
- ----------------------------------------------------------------------------
SHORT-TERM OBLIGATIONS: 3.7%
$1,663 Repurchase Agreement with
State Street Bank & Trust
Dated 6/30/04, Due 7/01/04
at 1.30% Collateralized by
Federal Home Loan Mortgage
Corporation Notes, Maturing
2/15/05, Market Value $1,698
(Repurchase proceeds: $1,663) $ 1,663
- ----------------------------------------------------------------------------
(COST: $1,663) 1,663
-----------
TOTAL INVESTMENTS (c): 100.5% 44,910
(COST: $33,835) (a)
CASH AND OTHER ASSETS LESS LIABILITIES: (0.5%) (208)
-----------
TOTAL NET ASSETS: 100% $ 44,702
============================================================================
- ----------------------------------------------------------------------------
>NOTES TO STATEMENT OF INVESTMENTS (IN THOUSANDS)
(a) At June 30, 2004, for federal income tax purpose cost of investments was
the same and net unrealized appreciation was $11,075 consisting of gross
unrealized appreciation of $11,840 and gross unrealized depreciation of
$765.
(b) Non-income producing security.
(c) On June 30, 2004, the Fund's total investments were denominated in
currencies as follows:
CURRENCY VALUE % OF NET ASSETS
-------------------- ------------ ---------------
Japanese Yen $ 11,539 25.8%
Euro 11,201 25.1
British Pounds 7,974 17.8
Swiss Franc 3,212 7.2
US Dollar 2,946 6.6
Canadian Dollar 2,432 5.5
Other currencies less
than 5% of total
net assets 5,606 12.5
------------ ---------------
$ 44,910 100.5%
============ ===============
50
1-800-922-6769
COLUMBIA ACORN INTERNATIONAL SELECT
>PORTFOLIO DIVERSIFICATION (UNAUDITED)
At June 30, 2004, the Fund's portfolio investments as a percent of net assets
was diversified as follows:
VALUE (000) PERCENT
- ----------------------------------------------------------------------------
>INDUSTRIAL GOODS/SERVICES
Other Industrial Services $ 3,031 6.8%
Electrical Components 2,300 5.2
Machinery 1,485 3.3
Construction 1,461 3.3
Steel 1,284 2.9
Industrial Distribution 957 2.1
Outsourcing and Training Services 733 1.6
Specialty Chemicals 580 1.3
Industrial Materials 466 1.0
- ----------------------------------------------------------------------------
12,297 27.5
>CONSUMER GOODS/SERVICES
Retail 2,813 6.3
Durable Goods 2,138 4.8
Consumer Electronics 1,464 3.3
Nondurables 1,251 2.8
Beverage 1,225 2.7
Restaurants 1,217 2.7
Food 530 1.2
Casinos 84 0.2
- ----------------------------------------------------------------------------
10,722 24.0
>FINANCE
Banks 6,649 14.9
Insurance 745 1.7
- ----------------------------------------------------------------------------
7,394 16.6
VALUE (000) PERCENT
- ----------------------------------------------------------------------------
>INFORMATION TECHNOLOGY
Semiconductors and
Related Equipment $ 1,301 2.9%
Television Broadcasting 882 2.0
Contract Manufacturing 873 1.9
Advertising 801 1.8
Satellite Broadcasting Services 761 1.7
- ----------------------------------------------------------------------------
4,618 10.3
>ENERGY/MINERALS
Oil/Gas Producers 2,798 6.3
Mining 857 1.9
Non-Ferrous Metals 444 1.0
- ----------------------------------------------------------------------------
4,099 9.2
>HEALTH CARE
Medical Equipment 2,286 5.1
Hospital Management 1,099 2.5
- ----------------------------------------------------------------------------
3,385 7.6
>OTHER INDUSTRIES
Regulated Utilities 732 1.6
- ----------------------------------------------------------------------------
732 1.6
------------ -----------
TOTAL COMMON STOCKS 43,247 96.8
SHORT-TERM OBLIGATIONS 1,663 3.7
------------ -----------
TOTAL INVESTMENTS 44,910 100.5
CASH AND OTHER ASSETS
LESS LIABILITIES (208) (0.5)
------------ -----------
NET ASSETS $ 44,702 100.0%
============================================================================
51
COLUMBIA ACORN SELECT
>MAJOR PORTFOLIO CHANGES IN THE SECOND QUARTER (UNAUDITED)
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
ADDITIONS
- ----------------------------------------------------------------------------
INFORMATION
McAfee 2,200,000 2,750,000
PeopleSoft 1,800,000 2,135,000
Skillsoft Publishing 0 2,063,700
Tellabs 0 3,400,000
- ----------------------------------------------------------------------------
CONSUMER GOODS/SERVICES
Abercrombie & Fitch 660,000 855,000
Safeway 1,050,000 1,500,000
- ----------------------------------------------------------------------------
FINANCE
SEI Investments 600,000 729,500
- ----------------------------------------------------------------------------
HEALTH CARE
Lincare Holdings 660,000 835,000
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
SALES
- ----------------------------------------------------------------------------
CONSUMER GOODS/SERVICES
Weight Watchers 1,040,000 728,000
- ----------------------------------------------------------------------------
FINANCE
TCF Financial 1,160,000 985,000
- ----------------------------------------------------------------------------
HEALTH CARE
Guidant 355,000 0
- ----------------------------------------------------------------------------
INDUSTRIAL GOODS/SERVICES
EXPEDITORS INTERNATIONAL OF
WASHINGTON 720,000 620,000
52
1-800-922-6769
COLUMBIA ACORN SELECT
>STATEMENT OF INEVESTMENTS (UNAUDITED) JUNE 30, 2004
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
COMMON STOCKS: 90.5%
- ----------------------------------------------------------------------------
INFORMATION: 34.0%
>BUSINESS SOFTWARE: 12.8%
2,750,000 McAfee (b) $ 49,858
SECURITY SOFTWARE & SERVICES
2,135,000 PeopleSoft (b) 39,498
HR, ERP, CRM & SUPPLY CHAIN SOFTWARE
1,300,000 Synopsys (b) 36,959
SOFTWARE FOR DESIGNING SEMICONDUCTOR CHIPS
- ----------------------------------------------------------------------------
126,315
>BUSINESS INFORMATION: 6.1%
470,000 Moody's 30,390
CREDIT RATING SERVICE
900,000 Fair Isaac 30,042
CREDIT SCORING & DECISION ANALYTIC SOFTWARE
- ----------------------------------------------------------------------------
60,432
>ADVERTISING: 3.8%
2,700,000 Interpublic Group (b) 37,071
ADVERTISING
- ----------------------------------------------------------------------------
>INSTRUMENTATION: 3.4%
1,000,000 Tektronix 34,020
ANALYTICAL INSTRUMENTS
- ----------------------------------------------------------------------------
>CONSUMER SOFTWARE: 3.3%
600,000 Electronic Arts (b) 32,730
ENTERTAINMENT SOFTWARE
- ----------------------------------------------------------------------------
>TELECOMMUNICATION EQUIPMENT: 3.0%
3,400,000 Tellabs (b) 29,716
TELECOMMUNICATIONS & CABLE EQUIPMENT
- ----------------------------------------------------------------------------
>INTERNET: 1.6%
2,063,700 Skillsoft Publishing (b) 15,684
PROVIDER OF WEB-BASED LEARNING SOLUTIONS (E-LEARNING)
- ----------------------------------------------------------------------------
-----------
INFORMATION: TOTAL 335,968
- ----------------------------------------------------------------------------
CONSUMER GOODS/SERVICES: 32.8%
>RETAIL: 10.3%
1,500,000 Safeway (b) 38,010
RETAIL FOOD & DRUG STORES
855,000 Abercrombie & Fitch 33,131
TEEN APPAREL RETAILER
750,000 Costco 30,802
WAREHOUSE SUPERSTORES
- ----------------------------------------------------------------------------
101,943
>CONSUMER SERVICES: 7.7%
1,250,000 ITT Educational Services (b) 47,525
TECHNOLOGY-ORIENTED POST SECONDARY DEGREE PROGRAMS
728,000 Weight Watchers (b) 28,494
WEIGHT LOSS PROGRAMS
- ----------------------------------------------------------------------------
76,019
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>FURNITURE & MANUFACTURERS: 6.3%
1,160,000 Herman Miller $ 33,570
OFFICE FURNITURE
630,000 Coach (b) 28,470
DESIGNER & RETAILER OF BRANDED LEATHER ACCESSORIES
- ----------------------------------------------------------------------------
62,040
>LEISURE VEHICLES: 6.3%
1,000,000 Harley-Davidson 61,940
MOTORCYCLES & RELATED MERCHANDISE
- ----------------------------------------------------------------------------
>ENTERTAINMENT: 2.2%
460,000 International Speedway Motors 22,374
LARGEST MOTORSPORT RACETRACK OWNER & OPERATOR
- ----------------------------------------------------------------------------
-----------
CONSUMER GOODS/SERVICES: TOTAL 324,316
- ----------------------------------------------------------------------------
FINANCE: 13.5%
>BANKS: 8.0%
985,000 TCF Financial 57,179
GREAT LAKES BANK
750,000 Associated Banc-Corp 22,223
MIDWEST BANK
- ----------------------------------------------------------------------------
79,402
>INSURANCE: 3.4%
120,000 Markel (b) 33,300
SPECIALTY INSURANCE
- ----------------------------------------------------------------------------
>MONEY MANAGEMENT: 2.1%
729,500 SEI Investments 21,185
MUTUAL FUND ADMINISTRATION & INVESTMENT MANAGEMENT
- ----------------------------------------------------------------------------
-----------
FINANCE: TOTAL 133,887
- ----------------------------------------------------------------------------
HEALTH CARE: 7.1%
>SERVICES: 7.1%
2,750,000 First Health (b) 42,928
PPO NETWORK
835,000 Lincare Holdings (b) 27,438
HOME HEALTH CARE SERVICES
- ----------------------------------------------------------------------------
70,366
-----------
HEALTH CARE: TOTAL 70,366
- ----------------------------------------------------------------------------
INDUSTRIAL GOODS/SERVICES: 3.1%
>LOGISTICS: 3.1%
620,000 Expeditors International of
Washington 30,634
INTERNATIONAL FREIGHT FORWARDER
-----------
INDUSTRIAL GOODS/SERVICES: TOTAL 30,634
-----------
TOTAL COMMON STOCKS: 90.5% 895,171
(COST: $768,527)
53
COLUMBIA ACORN SELECT
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
PRINCIPAL AMOUNT (000) VALUE (000)
- ----------------------------------------------------------------------------
SHORT-TERM OBLIGATIONS: 9.6%
Yield 1.00% - 1.30%
Due 7/1/04 - 7/8/04
$ 35,000 Virginia Electric $ 34,991
30,000 Prudential Funding 29,999
25,000 Coca Cola Enterprises 25,000
4,668 Repurchase Agreement with
State Street Bank & Trust
Dated 6/30/04, Due 7/01/04
at 1.30% Collateralized by
Federal Home Loan Mortgage
Corporation Notes, Maturing
2/15/05, Market Value $4,765
(Repurchase proceeds: $4,668) 4,668
- ----------------------------------------------------------------------------
(AMORTIZED COST: $94,658) 94,658
-----------
TOTAL INVESTMENTS: 100.1% 989,829
(COST: $863,185) (a)
CASH AND OTHER ASSETS LESS LIABILITIES: (0.1%) (848)
-----------
TOTAL NET ASSETS: 100% $ 988,981
============================================================================
>NOTES TO STATEMENT OF INVESTMENTS (IN THOUSANDS)
(a) At June 30, 2004, for federal income tax purposes cost of investments was
the same and net unrealized appreciation was $126,644, consisting of gross
unrealized appreciation of $158,975 and gross unrealized depreciation of
$32,331.
(b) Non-income producing security.
54
1-800-922-6769
COLUMBIA ACORN FAMILY OF FUNDS
> STATEMENTS OF ASSETS AND LIABILITIES
> STATEMENTS OF OPERATIONS
> STATEMENTS OF CHANGES IN NET ASSETS
> FINANCIAL HIGHLIGHTS
> NOTES TO FINANCIAL STATEMENTS
55
Columbia Acorn Family of Funds
>Statements of Assets and Liabilities (Unaudited)
COLUMBIA COLUMBIA
ACORN ACORN
JUNE 30, 2004 FUND INTERNATIONAL
-------------------- -------------------
(IN THOUSANDS)
ASSETS
Unaffiliated investments, at Cost $ 6,441,885 $ 1,248,315
Affiliated investments, at Cost (See Note 4) 1,459,400 --
-------------------- -------------------
Unaffiliated investments, at Value $ 10,223,691 $ 1,728,717
Affiliated investments, at Value (See Note 4) 2,055,516 --
Cash -- --
Foreign currency (cost: Columbia Acorn
Fund $12,413; Columbia Acorn
International $3,802; Columbia Acorn
International Select $94) 12,404 3,794
Receivable for:
Investments sold 11,447 21,118
Fund shares sold 25,309 928
Dividends and interest 6,289 3,910
Expense reimbursement due from Advisor -- --
Deferred Trustees' Compensation Investments 1,155 440
Other assets 691 612
-------------------- -------------------
Total Assets 12,336,502 1,759,519
LIABILITIES
Payable to custodian bank -- 18,587
Payable for:
Investments purchased 30,626 6,414
Fund shares redeemed 11,305 5,528
Custodian -- --
Management fee -- 3
12b-1 Service & Distribution fees 2,661 71
Legal & audit fees 37 --
Reports to shareholders -- --
Deferred Trustees' fees 1,155 440
Transfer agent fees 441 99
Trustees' fees -- --
Registration & blue sky fees 60 16
Foreign capital gains tax 667 175
-------------------- -------------------
Total Liabilities 46,952 31,333
-------------------- -------------------
NET ASSETS $ 12,289,550 $ 1,728,186
==================== ===================
COMPOSITION OF NET ASSETS
Paid in capital $ 7,481,497 $ 1,386,259
Undistributed net investment income
(Accumulated net investment loss) 9,339 13,761
Accumulated net realized gain (loss) 421,428 (150,889)
Net unrealized appreciation (depreciation) on:
Investments (net of unrealized PFIC
gains of $1,215 for Columbia Acorn
International) 4,377,922 479,187
Foreign currency transactions 31 43
Foreign capital gains tax (667) (175)
-------------------- -------------------
NET ASSETS $ 12,289,550 $ 1,728,186
==================== ===================
Net asset value per share --
Class A (a) $ 24.11 $ 24.20
(Net assets/shares) ($2,317,581/96,128) ($55,692/2,302)
Maximum offering price
per share -- Class A (b) $ 25.58 $ 25.68
(Net asset value per share/
front-end sales charge) ($24.11/0.9425) ($24.20/0.9425)
Net asset value and offering
price per share -- Class B (a) $ 23.54 $ 23.81
(Net assets/shares) ($1,302,614/55,347) ($45,081/1,894)
Net asset value and offering
price per share -- Class C (a) $ 23.54 $ 23.82
(Net assets/shares) ($981,925/41,721) ($25,023/1,051)
Net asset value, offering and
redemption price per share --
Class Z $ 24.56 $ 24.39
(Net assets/shares) ($7,687,430/313,049) ($1,602,390/65,709)
COLUMBIA COLUMBIA COLUMBIA
ACORN ACORN ACORN
JUNE 30, 2004 USA INTERNATIONAL SELECT SELECT
----------------- -------------------- -----------------
(IN THOUSANDS)
ASSETS
Unaffiliated investments, at Cost $ 542,747 $ 33,835 $ 863,185
Affiliated investments, at Cost (See Note 4) 5,636 -- --
----------------- -------------------- -----------------
Unaffiliated investments, at Value $ 763,106 $ 44,910 $ 989,829
Affiliated investments, at Value (See Note 4) 4,990 -- --
Cash 1 -- 1
Foreign currency (cost: Columbia Acorn
Fund $12,413; Columbia Acorn
International $3,802; Columbia Acorn
International Select $94) -- 93 --
Receivable for:
Investments sold -- 29 --
Fund shares sold 1,378 83 4,435
Dividends and interest 92 46 84
Expense reimbursement due from Advisor -- 8 --
Deferred Trustees' Compensation Investments 79 -- --
Other assets 89 1 72
----------------- -------------------- -----------------
Total Assets 769,735 45,170 994,421
LIABILITIES
Payable to custodian bank -- -- --
Payable for:
Investments purchased 17 392 3,225
Fund shares redeemed 1,562 28 1,791
Custodian 2 -- 2
Management fee -- -- --
12b-1 Service & Distribution fees 118 5 326
Legal & audit fees -- 8 11
Reports to shareholders -- 11 --
Deferred Trustees' fees 79 -- --
Transfer agent fees 41 9 79
Trustees' fees -- 1 --
Registration & blue sky fees -- 14 6
Foreign capital gains tax -- -- --
----------------- -------------------- -----------------
Total Liabilities 1,819 468 5,440
----------------- -------------------- -----------------
NET ASSETS $ 767,916 $ 44,702 $ 988,981
================= ==================== =================
COMPOSITION OF NET ASSETS
Paid in capital $ 555,632 $ 67,136 $ 819,743
Undistributed net investment income
(Accumulated net investment loss) (3,256) 41 (4,253)
Accumulated net realized gain (loss) (4,173) (33,551) 46,847
Net unrealized appreciation (depreciation) on:
Investments (net of unrealized PFIC
gains of $1,215 for Columbia Acorn
International) 219,713 11,075 126,644
Foreign currency transactions -- 1 --
Foreign capital gains tax -- -- --
----------------- -------------------- -----------------
NET ASSETS $ 767,916 $ 44,702 $ 988,981
================= ==================== =================
Net asset value per share --
Class A (a) $ 22.74 $ 15.50 $ 19.30
(Net assets/shares) ($103,174/4,538) ($3,194/206) ($384,079/19,897)
Maximum offering price
per share -- Class A (b) $ 24.13 $ 16.45 $ 20.48
(Net asset value per share/
front-end sales charge) ($22.74/0.9425) ($15.50/0.9425) ($19.30/0.9425)
Net asset value and offering
price per share -- Class B (a) $ 22.23 $ 15.12 $ 18.84
(Net assets/shares) ($70,114/3,153) ($3,928/260) ($156,718/8,320)
Net asset value and offering
price per share -- Class C (a) $ 22.25 $ 15.15 $ 18.84
(Net assets/shares) ($38,992/1,753) ($2,094/138) ($89,703/4,762)
Net asset value, offering and
redemption price per share --
Class Z $ 23.08 $ 15.63 $ 19.55
(Net assets/shares) ($555,636/24,074) ($35,486/2,271) ($358,481/18,336)
(a) Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
(b) On sales of $50,000 or more the offering price is reduced.
See accompanying notes to financial statements.
56
1-800-922-6769
COLUMBIA ACORN FAMILY OF FUNDS
>STATEMENTS OF OPERATIONS (UNAUDITED)
FOR THE SIX MONTHS ENDED JUNE 30, 2004
COLUMBIA COLUMBIA
ACORN ACORN
(IN THOUSANDS) FUND INTERNATIONAL
--------- -------------
INVESTMENT INCOME:
Dividend income $ 62,690 $ 26,029
Dividend income from affiliates (See Note 4) 3,333 --
Interest income 3,970 231
--------- -------------
69,993 26,260
Foreign taxes withheld (3,122) (2,608)
--------- -------------
Total Investment Income 66,871 23,652
EXPENSES:
Management fee 38,885 7,073
Administration fee 2,939 430
12b-1 Service and Distribution fees:
Class A 3,815 98
Class B 6,333 214
Class C 4,738 124
Transfer agent fees:
Class A 1,663 53
Class B 1,571 76
Class C 1,019 30
Class Z 1,421 591
Custody fees 634 520
Trustees' fees 209 34
Registration & blue sky fees 302 49
Reports to shareholders 834 148
Legal & audit fees 669 75
Non-recurring costs (See Note 7) 135 20
Other expenses 118 21
--------- -------------
Total expenses 65,285 9,556
Less custody fees paid indirectly (16) --*
Less reimbursement of expenses by Advisor (647) (93)
Non-recurring costs reimbursed (See Note 7) (135) (20)
--------- -------------
Net Expenses 64,487 9,443
--------- -------------
Net Investment Income (Loss) 2,384 14,209
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON PORTFOLIO POSITIONS:
Net realized gain (loss) on:
Unaffiliated investments 362,021 87,220
Affiliated investments (See Note 4) 62,019 --
Foreign currency transactions (41) 416
--------- -------------
Net realized gain 423,999 87,636
========= =============
Net change in net unrealized appreciation/
depreciation on:
Unaffiliated investments 553,555 40,841
Affiliated investments (See Note 4) 4,005 --
Foreign currency transactions 1,560 518
Foreign capital gains tax (667) (175)
--------- -------------
Net change in unrealized appreciation/
depreciation 558,453 41,184
========= =============
Net realized and unrealized gain 982,452 128,820
--------- -------------
Net Increase in Net Assets resulting
from Operations $ 984,836 $ 143,029
========= =============
COLUMBIA COLUMBIA COLUMBIA
ACORN ACORN ACORN
(IN THOUSANDS) USA INTERNATIONAL SELECT SELECT
-------- -------------------- --------
INVESTMENT INCOME:
Dividend income $ 1,080 $ 458 $ 2,238
Dividend income from affiliates (See Note 4) -- -- --
Interest income 255 7 427
-------- -------------------- --------
1,335 465 2,665
Foreign taxes withheld (1) (48) --
-------- -------------------- --------
Total Investment Income 1,334 417 2,665
EXPENSES:
Management fee 3,299 210 4,008
Administration fee 181 11 223
12b-1 Service and Distribution fees:
Class A 171 5 583
Class B 343 17 700
Class C 189 17 397
Transfer agent fees:
Class A 83 4 283
Class B 88 9 214
Class C 39 4 101
Class Z 119 33 162
Custody fees 16 22 13
Trustees' fees 13 3 8
Registration & blue sky fees 55 38 113
Reports to shareholders 87 31 113
Legal & audit fees 29 12 34
Non-recurring costs (See Note 7) 8 1 10
Other expenses 7 3 9
-------- -------------------- --------
Total expenses 4,727 420 6,971
Less custody fees paid indirectly (1) --* --*
Less reimbursement of expenses by Advisor (36) (58) (64)
Non-recurring costs reimbursed (See Note 7) (8) (1) (10)
-------- -------------------- --------
Net Expenses 4,682 361 6,897
-------- -------------------- --------
Net Investment Income (Loss) (3,348) 56 (4,232)
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON PORTFOLIO POSITIONS:
Net realized gain (loss) on:
Unaffiliated investments 12,979 4,798 47,083
Affiliated investments (See Note 4) (3,800) -- --
Foreign currency transactions -- (3) --
-------- -------------------- --------
Net realized gain 9,179 4,795 47,083
======== ==================== ========
Net change in net unrealized appreciation/
depreciation on:
Unaffiliated investments 64,025 (1,679) 16,432
Affiliated investments (See Note 4) (2,712) -- --
Foreign currency transactions -- (13) --
Foreign capital gains tax -- -- --
-------- -------------------- --------
Net change in unrealized appreciation/
depreciation 61,313 (1,692) 16,432
======== ==================== ========
Net realized and unrealized gain 70,492 3,103 63,515
-------- -------------------- --------
Net Increase in Net Assets resulting
from Operations $ 67,144 $ 3,159 $ 59,283
======== ==================== ========
* Rounds to less than $500.
See accompanying notes to financial statements.
57
COLUMBIA ACORN FAMILY OF FUNDS
>STATEMENTS OF CHANGES IN NET ASSETS
COLUMBIA COLUMBIA ACORN
ACORN FUND INTERNATIONAL
(UNAUDITED) (UNAUDITED)
SIX MONTHS YEAR ENDED SIX MONTHS YEAR ENDED
INCREASE (DECREASE) IN NET ASSETS ENDED JUNE 30, DECEMBER 31, ENDED JUNE 30, DECEMBER 31,
-------------- ------------ -------------- ------------
(IN THOUSANDS) 2004 2003 2004 2003
OPERATIONS:
Net investment income (loss) $ 2,384 $ (9,911) $ 14,209 $ 15,934
Net realized gain (loss) on investments
and foreign currency transactions 423,999 90,682 87,636 (7,144)
Net change in net unrealized appreciation
(depreciation) of investments and foreign
currency transactions 558,453 2,974,675 41,184 561,990
-------------- ------------ -------------- ------------
Net Increase from Operations 984,836 3,055,446 143,029 570,780
DISTRIBUTION TO SHAREHOLDERS FROM:
Net investment income -- Class A -- -- (356) (106)
Net realized gain -- Class A (2,709) (1,752) -- --
Net investment income -- Class B -- -- (75) --
Net realized gain -- Class B (1,570) (1,116) -- --
Net investment income -- Class C -- -- (42) --
Net realized gain -- Class C (1,182) (813) -- --
Net investment income -- Class Z -- -- (16,468) (5,829)
Net realized gain -- Class Z (8,844) (6,236) -- --
-------------- ------------ -------------- ------------
Total Distribution to Shareholders (14,305) (9,917) (16,941) (5,935)
SHARE TRANSACTIONS:
Subscriptions -- Class A 394,994 1,041,782 9,334 45,279
Distributions reinvested -- Class A 2,456 1,584 288 80
Redemptions -- Class A (237,930) (259,438) (10,981) (42,948)
-------------- ------------ -------------- ------------
Net Increase (Decrease) -- Class A 159,520 783,928 (1,359) 2,411
Subscriptions -- Class B 55,758 364,144 5,820 11,463
Distributions reinvested -- Class B 1,433 1,018 66 --
Redemptions -- Class B (75,752) (88,744) (3,800) (5,639)
-------------- ------------ -------------- ------------
Net Increase (Decrease) -- Class B (18,561) 276,418 2,086 5,824
Subscriptions -- Class C 77,410 375,513 4,006 14,870
Distributions reinvested -- Class C 972 673 35 --
Redemptions -- Class C (70,493) (73,548) (3,818) (13,396)
-------------- ------------ -------------- ------------
Net Increase (Decrease) -- Class C 7,889 302,638 223 1,474
Subscriptions -- Class Z 873,722 1,682,204 95,148 220,802
Distributions reinvested -- Class Z 7,792 5,443 14,698 5,336
Redemptions -- Class Z (880,158) (667,986) (187,093) (434,204)
-------------- ------------ -------------- ------------
Net Increase (Decrease) -- Class Z 1,356 1,019,661 (77,247) (208,066)
-------------- ------------ -------------- ------------
Net Increase (Decrease) from
Share Transactions 150,204 2,382,645 (76,297) (198,357)
-------------- ------------ -------------- ------------
Redemption Fees -- -- 63 400
-------------- ------------ -------------- ------------
Total Increase in Net Assets 1,120,735 5,428,174 49,854 366,888
NET ASSETS:
Beginning of period 11,168,815 5,740,641 1,678,332 1,311,444
-------------- ------------ -------------- ------------
End of period $ 12,289,550 $ 11,168,815 $ 1,728,186 $ 1,678,332
============== ============ ============== ============
UNDISTRIBUTED NET INVESTMENT INCOME
(ACCUMULATED NET INVESTMENT LOSS) $ 9,339 $ 6,955 $ 13,761 $ 16,493
============== ============ ============== ============
COLUMBIA COLUMBIA ACORN
ACORN USA INTERNATIONAL SELECT
(UNAUDITED) (UNAUDITED)
SIX MONTHS YEAR ENDED SIX MONTHS YEAR ENDED
INCREASE (DECREASE) IN NET ASSETS ENDED JUNE 30, DECEMBER 31, ENDED JUNE 30, DECEMBER 31,
-------------- ------------ -------------- ------------
(IN THOUSANDS) 2004 2003 2004 2003
OPERATIONS:
Net investment income (loss) $ (3,348) $ (4,408) $ 56 $ 136
Net realized gain (loss) on investments
and foreign currency transactions 9,179 7,301 4,795 (425)
Net change in net unrealized appreciation
(depreciation) of investments and foreign
currency transactions 61,313 172,313 (1,692) 12,936
-------------- ------------ -------------- ------------
Net Increase from Operations 67,144 175,206 3,159 12,647
DISTRIBUTION TO SHAREHOLDERS FROM:
Net investment income -- Class A -- -- (6) --
Net realized gain -- Class A -- -- -- --
Net investment income -- Class B -- -- -- --
Net realized gain -- Class B -- -- -- --
Net investment income -- Class C -- -- -- --
Net realized gain -- Class C -- -- -- --
Net investment income -- Class Z -- -- (151) (19)
Net realized gain -- Class Z -- -- -- --
-------------- ------------ -------------- ------------
Total Distribution to Shareholders -- -- (157) (19)
SHARE TRANSACTIONS:
Subscriptions -- Class A 17,327 60,457 821 2,350
Distributions reinvested -- Class A -- -- 5 --
Redemptions -- Class A (12,605) (23,188) (380) (3,212)
-------------- ------------ -------------- ------------
Net Increase (Decrease) -- Class A 4,722 37,269 446 (862)
Subscriptions -- Class B 3,084 19,327 762 1,577
Distributions reinvested -- Class B -- -- -- --
Redemptions -- Class B (5,153) (8,053) (239) (989)
-------------- ------------ -------------- ------------
Net Increase (Decrease) -- Class B (2,069) 11,274 523 588
Subscriptions -- Class C 3,376 13,056 445 3,211
Distributions reinvested -- Class C -- -- -- --
Redemptions -- Class C (3,355) (4,575) (2,222) (3,564)
-------------- ------------ -------------- ------------
Net Increase (Decrease) -- Class C 21 8,481 (1,777) (353)
Subscriptions -- Class Z 116,241 221,496 2,488 23,389
Distributions reinvested -- Class Z -- -- 146 18
Redemptions -- Class Z (111,417) (83,975) (3,534) (25,393)
-------------- ------------ -------------- ------------
Net Increase (Decrease) -- Class Z 4,824 137,521 (900) (1,986)
-------------- ------------ -------------- ------------
Net Increase (Decrease) from
Share Transactions 7,498 194,545 (1,708) (2,613)
-------------- ------------ -------------- ------------
Redemption Fees -- -- 2 39
-------------- ------------ -------------- ------------
Total Increase in Net Assets 74,642 369,751 1,296 10,054
NET ASSETS:
Beginning of period 693,274 323,523 43,406 33,352
-------------- ------------ -------------- ------------
End of period $ 767,916 $ 693,274 $ 44,702 $ 43,406
============== ============ ============== ============
UNDISTRIBUTED NET INVESTMENT INCOME
(ACCUMULATED NET INVESTMENT LOSS) $ (3,256) $ 92 $ 41 $ 142
============== ============ ============== ============
COLUMBIA
ACORN SELECT
(UNAUDITED)
SIX MONTHS YEAR ENDED
INCREASE (DECREASE) IN NET ASSETS ENDED JUNE 30, DECEMBER 31,
-------------- ------------
(IN THOUSANDS) 2004 2003
OPERATIONS:
Net investment income (loss) $ (4,232) $ (4,419)
Net realized gain (loss) on investments
and foreign currency transactions 47,083 8,643
Net change in net unrealized appreciation
(depreciation) of investments and foreign
currency transactions 16,432 95,023
-------------- ------------
Net Increase from Operations 59,283 99,247
DISTRIBUTION TO SHAREHOLDERS FROM:
Net investment income -- Class A -- --
Net realized gain -- Class A -- (1,172)
Net investment income -- Class B -- --
Net realized gain -- Class B -- (563)
Net investment income -- Class C -- --
Net realized gain -- Class C -- (301)
Net investment income -- Class Z -- --
Net realized gain -- Class Z -- (2,145)
-------------- ------------
Total Distribution to Shareholders -- (4,181)
SHARE TRANSACTIONS:
Subscriptions -- Class A 147,794 237,520
Distributions reinvested -- Class A -- 1,096
Redemptions -- Class A (50,572) (30,378)
-------------- ------------
Net Increase (Decrease) -- Class A 97,222 208,238
Subscriptions -- Class B 39,146 78,641
Distributions reinvested -- Class B -- 507
Redemptions -- Class B (9,370) (9,321)
-------------- ------------
Net Increase (Decrease) -- Class B 29,776 69,827
Subscriptions -- Class C 28,340 50,838
Distributions reinvested -- Class C -- 257
Redemptions -- Class C (7,816) (4,391)
-------------- ------------
Net Increase (Decrease) -- Class C 20,524 46,704
Subscriptions -- Class Z 110,515 301,467
Distributions reinvested -- Class Z -- 1,920
Redemptions -- Class Z (68,958) (150,913)
-------------- ------------
Net Increase (Decrease) -- Class Z 41,557 152,474
-------------- ------------
Net Increase (Decrease) from
Share Transactions 189,079 477,243
-------------- ------------
Redemption Fees -- --
-------------- ------------
Total Increase in Net Assets 248,362 572,309
NET ASSETS:
Beginning of period 740,619 168,310
-------------- ------------
End of period $ 988,981 $ 740,619
============== ============
UNDISTRIBUTED NET INVESTMENT INCOME
(ACCUMULATED NET INVESTMENT LOSS) $ (4,253) $ (21)
============== ============
See accompanying notes to financial statements.
58-59 Spread
1-800-922-6769
COLUMBIA ACORN FAMILY OF FUNDS
>STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
COLUMBIA COLUMBIA ACORN
ACORN FUND INTERNATIONAL
(UNAUDITED) (UNAUDITED)
SIX MONTHS YEAR ENDED SIX MONTHS YEAR ENDED
CHANGES IN SHARES OF BENEFICIAL INTEREST: ENDED JUNE 30, DECEMBER 31, ENDED JUNE 30, DECEMBER 31,
--------------- ------------- -------------- ------------
(IN THOUSANDS) 2004 2003 2004 2003
Subscriptions -- Class A 16,980 56,202 396 2,734
Shares issued in reinvestment and capital
gains -- Class A 105 73 13 5
Less shares redeemed -- Class A (10,239) (14,204) (462) (2,590)
--------------- ------------ -------------- ------------
Net Increase (Decrease) -- Class A 6,846 42,071 (53) 149
Subscriptions -- Class B 2,448 20,371 252 653
Shares issued in reinvestment and capital
gains -- Class B 63 48 3 --
Less shares redeemed -- Class B (3,332) (5,154) (164) (343)
--------------- ------------ -------------- ------------
Net Increase (Decrease) -- Class B (821) 15,265 91 310
Subscriptions -- Class C 3,397 20,690 173 911
Shares issued in reinvestment and capital
gains -- Class C 43 32 2 --
Less shares redeemed -- Class C (3,096) (4,207) (166) (833)
--------------- ------------ -------------- ------------
Net Increase (Decrease) -- Class C 344 16,515 9 78
Subscriptions -- Class Z 36,993 89,984 4,001 13,104
Shares issued in reinvestment and capital
gains -- Class Z 327 249 625 313
Less shares redeemed -- Class Z (37,398) (36,502) (7,872) (25,027)
--------------- ------------ -------------- ------------
Net Increase (Decrease) -- Class Z (78) 53,731 (3,246) (11,610)
--------------- ------------ -------------- ------------
Net Increase (Decrease) in Shares of
Beneficial Interest 6,291 127,582 (3,199) (11,073)
--------------- ------------ -------------- ------------
COLUMBIA COLUMBIA ACORN
ACORN USA INTERNATIONAL SELECT
(UNAUDITED) (UNAUDITED)
SIX MONTHS YEAR ENDED SIX MONTHS YEAR ENDED
CHANGES IN SHARES OF BENEFICIAL INTEREST: ENDED JUNE 30, DECEMBER 31, ENDED JUNE 30, DECEMBER 31,
--------------- ------------ -------------- ------------
(IN THOUSANDS) 2004 2003 2004 2003
Subscriptions -- Class A 795 3,345 54 216
Shares issued in reinvestment and capital
gains -- Class A -- -- -- --
Less shares redeemed -- Class A (579) (1,309) (25) (294)
--------------- ------------ -------------- ------------
Net Increase (Decrease) -- Class A 216 2,036 29 (78)
Subscriptions -- Class B 144 1,087 52 137
Shares issued in reinvestment and capital
gains -- Class B -- -- -- --
Less shares redeemed -- Class B (241) (512) (16) (95)
--------------- ------------ -------------- ------------
Net Increase (Decrease) -- Class B (97) 575 36 42
Subscriptions -- Class C 158 724 30 311
Shares issued in reinvestment and capital
gains -- Class C -- -- -- --
Less shares redeemed -- Class C (157) (279) (153) (339)
--------------- ------------ -------------- ------------
Net Increase (Decrease) -- Class C 1 445 (123) (28)
Subscriptions -- Class Z 5,262 12,184 163 2,239
Shares issued in reinvestment and capital
gains -- Class Z -- -- 10 2
Less shares redeemed -- Class Z (5,074) (4,772) (233) (2,435)
--------------- ------------ -------------- ------------
Net Increase (Decrease) -- Class Z 188 7,412 (60) (194)
--------------- ------------ -------------- ------------
Net Increase (Decrease) in Shares of
Beneficial Interest 308 10,468 (118) (258)
--------------- ------------ -------------- ------------
COLUMBIA
ACORN SELECT
(UNAUDITED)
SIX MONTHS YEAR ENDED
CHANGES IN SHARES OF BENEFICIAL INTEREST: ENDED JUNE 30, DECEMBER 31,
--------------- ------------
(IN THOUSANDS) 2004 2003
Subscriptions -- Class A 7,899 14,227
Shares issued in reinvestment and capital
gains -- Class A -- 63
Less shares redeemed -- Class A (2,702) (1,869)
--------------- ------------
Net Increase (Decrease) -- Class A 5,197 12,421
Subscriptions -- Class B 2,138 4,854
Shares issued in reinvestment and capital
gains -- Class B -- 30
Less shares redeemed -- Class B (512) (601)
--------------- ------------
Net Increase (Decrease) -- Class B 1,626 4,283
Subscriptions -- Class C 1,549 3,102
Shares issued in reinvestment and capital
gains -- Class C -- 15
Less shares redeemed -- Class C (428) (271)
--------------- ------------
Net Increase (Decrease) -- Class C 1,121 2,846
Subscriptions -- Class Z 5,839 18,117
Shares issued in reinvestment and capital
gains -- Class Z -- 108
Less shares redeemed -- Class Z (3,641) (8,676)
--------------- ------------
Net Increase (Decrease) -- Class Z 2,198 9,549
--------------- ------------
Net Increase (Decrease) in Shares of
Beneficial Interest 10,142 29,099
--------------- ------------
See accompanying notes to financial statements.
60 - 61 Spread
1-800-922-6769
COLUMBIA ACORN FAMILY OF FUNDS
>FINANCIAL HIGHLIGHTS
COLUMBIA ACORN FUND
(UNAUDITED)
SIX MONTHS
CLASS A SHARES ENDED JUNE 30,
--------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004
NET ASSET VALUE, BEGINNING OF PERIOD $ 22.20
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (b) (0.01)
Net realized and unrealized gain (loss) 1.95
--------------
Total from Investment Operations 1.94
--------------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income --
From net realized gains (0.03)
--------------
Total Distributions Declared to Shareholders (0.03)
--------------
NET ASSET VALUE, END OF PERIOD $ 24.11
==============
Total Return (c) 8.73%(d)(e)
--------------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 1.25%(g)
Net investment income (loss) (f) (0.11)%(g)
Reimbursement 0.01%(g)
Portfolio turnover rate 11%(d)
Net assets at end of period (000's) $ 2,317,581
CLASS A SHARES YEAR ENDED DECEMBER 31,
-------------------------------------------------------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2003 2002 2001 2000(a)
NET ASSET VALUE, BEGINNING OF PERIOD $ 15.34 $ 17.80 $ 17.19 $ 17.88
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (b) (0.07) (0.07) (0.05) 0.01
Net realized and unrealized gain (loss) 6.95 (2.39) 1.01 1.22
-------------- ----------- ----------- ----------
Total from Investment Operations 6.88 (2.46) 0.96 1.23
-------------- ----------- ----------- ----------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income -- -- -- (0.06)
From net realized gains (0.02) -- (0.35) (1.86)
-------------- ----------- ----------- ----------
Total Distributions Declared to Shareholders (0.02) -- (0.35) (1.92)
-------------- ----------- ----------- ----------
NET ASSET VALUE, END OF PERIOD $ 22.20 $ 15.34 $ 17.80 $ 17.19
============== =========== =========== ==========
Total Return (c) 44.85% (13.82)% 5.56% 7.40%(d)
-------------- ----------- ----------- ----------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 1.33% 1.42% 1.42% 1.25%(g)(h)
Net investment income (loss) (f) (0.36)% (0.45)% (0.33)% 0.17%(g)(h)
Reimbursement -- -- -- --
Portfolio turnover rate 10% 13% 20% 29%(d)
Net assets at end of period (000's) $ 1,982,260 $ 724,121 $ 306,405 $ 18,252
(a) Class A Shares were initially offered on October 16, 2000. Per share data
reflects activity from that date.
(b) Per share data was calculated using average shares outstanding during the
period.
(c) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(d) Not annualized.
(e) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(f) The benefits derived from custody fees paid indirectly had no impact.
(g) Annualized.
(h) The ratios of expenses and net investment loss to average net assets,
previously reported as 1.03% and 0.39% respectively, were revised to reflect
all class specific expenses in this period.
(UNAUDITED)
SIX MONTHS
CLASS B SHARES ENDED JUNE 30,
--------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004
NET ASSET VALUE, BEGINNING OF PERIOD $ 21.75
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (b) (0.10)
Net realized and unrealized gain (loss) 1.92
--------------
Total from Investment Operations 1.82
--------------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income --
From net realized gains (0.03)
--------------
Total Distributions Declared to Shareholders (0.03)
--------------
NET ASSET VALUE, END OF PERIOD $ 23.54
==============
Total Return (c) 8.36%(d)(e)
--------------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 1.99%(g)
Net investment loss (f) (0.85)%(g)
Reimbursement 0.01%(g)
Portfolio turnover rate 11%(d)
Net assets at end of period (000's) $ 1,302,614
CLASS B SHARES YEAR ENDED DECEMBER 31,
------------------------------------------------------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2003 2002 2001 2000(a)
NET ASSET VALUE, BEGINNING OF PERIOD $ 15.13 $ 17.67 $ 17.17 $ 17.88
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (b) (0.18) (0.17) (0.16) (0.01)
Net realized and unrealized gain (loss) 6.82 (2.37) 1.01 1.22
------------- ----------- ----------- ----------
Total from Investment Operations 6.64 (2.54) 0.85 1.21
------------- ----------- ----------- ----------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income -- -- -- (0.06)
From net realized gains (0.02) -- (0.35) (1.86)
------------- ----------- ----------- ----------
Total Distributions Declared to Shareholders (0.02) -- (0.35) (1.92)
------------- ----------- ----------- ----------
NET ASSET VALUE, END OF PERIOD $ 21.75 $ 15.13 $ 17.67 $ 17.17
============= =========== =========== ==========
Total Return (c) 43.89% (14.37)% 4.92% 7.27%(d)
------------- ----------- ----------- ----------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 1.98% 2.07% 2.07% 1.90%(g)(h)
Net investment loss (f) (1.01)% (1.10)% (0.98)% (0.48)%(g)(h)
Reimbursement -- -- -- --
Portfolio turnover rate 10% 13% 20% 29%(d)
Net assets at end of period (000's) $ 1,221,931 $ 618,727 $ 286,422 $ 15,951
(a) Class B Shares were initially offered on October 16, 2000. Per share data
reflects activity from that date.
(b) Per share data was calculated using average shares outstanding during the
period.
(c) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(d) Not annualized.
(e) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(f) The benefits derived from custody fees paid indirectly had no impact.
(g) Annualized.
(h) The ratios of expenses and net investment loss to average net assets,
previously reported as 1.68% and (0.26)% respectively, were revised to
reflect all class specific expenses in this period.
(UNAUDITED)
SIX MONTHS
CLASS C SHARES ENDED JUNE 30,
--------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004
NET ASSET VALUE, BEGINNING OF PERIOD $ 21.75
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (b) (0.09)
Net realized and unrealized gain (loss) 1.91
--------------
Total from Investment Operations 1.82
--------------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income --
From net realized gains (0.03)
--------------
Total Distributions Declared to Shareholders (0.03)
--------------
NET ASSET VALUE, END OF PERIOD $ 23.54
==============
Total Return (c) 8.36%(d)(e)
--------------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 1.96%(g)
Net investment loss (f) (0.82)%(g)
Reimbursement 0.01%(g)
Portfolio turnover rate 11%(d)
Net assets at end of period (000's) $ 981,925
CLASS C SHARES YEAR ENDED DECEMBER 31,
---------------------------------------------------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2003 2002 2001 2000(a)
NET ASSET VALUE, BEGINNING OF PERIOD $ 15.12 $ 17.66 $ 17.17 $ 17.88
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (b) (0.18) (0.17) (0.17) (0.01)
Net realized and unrealized gain (loss) 6.83 (2.37) 1.01 1.22
----------- ----------- ----------- ---------
Total from Investment Operations 6.65 (2.54) 0.84 1.21
----------- ----------- ----------- ---------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income -- -- -- (0.06)
From net realized gains (0.02) -- (0.35) (1.86)
----------- ----------- ----------- ---------
Total Distributions Declared to Shareholders (0.02) -- (0.35) (1.92)
----------- ----------- ----------- ---------
NET ASSET VALUE, END OF PERIOD $ 21.75 $ 15.12 $ 17.66 $ 17.17
=========== =========== =========== =========
Total Return (c) 43.99% (14.38)% 4.86% 7.27%(d)
----------- ----------- ----------- ---------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 1.98% 2.07% 2.07% 1.90%(g)(h)
Net investment loss (f) (1.01)% (1.10)% (0.98)% (0.48)%(g)(h)
Reimbursement -- -- -- --
Portfolio turnover rate
10% 13% 20% 29%(d)
Net assets at end of period (000's) $ 900,016 $ 376,024 $ 150,727 $ 8,510
(a) Class C Shares were initially offered on October 16, 2000. Per share data
reflects activity from that date.
(b) Per share data was calculated using average shares outstanding during the
period.
(c) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(d) Not annualized.
(e) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(f) The benefits derived from custody fees paid indirectly had no impact.
(g) Annualized.
(h) The ratios of expenses and net investment loss to average net assets,
previously reported as 1.68% and (0.26)% respectively, were revised to
reflect all class specific expenses in this period.
See accompanying notes to financial statements
62
1-800-922-6769
COLUMBIA ACORN INTERNATIONAL
(UNAUDITED)
SIX MONTHS
CLASS A SHARES ENDED JUNE 30,
--------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004
NET ASSET VALUE, BEGINNING OF PERIOD $ 22.45
INCOME FROM INVESTMENT OPERATIONS
Net investment income (b) 0.15
Net realized and unrealized gain (loss) 1.75
--------------
Total from Investment Operations 1.90
--------------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income (0.15)
From net realized gains --
--------------
Total Distributions Declared to Shareholders (0.15)
--------------
NET ASSET VALUE, END OF PERIOD $ 24.20
==============
Total Return (c) 8.51%(d)(e)
--------------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 1.50%(g)
Net investment income (f) 1.25%(g)
Reimbursement 0.01%(g)
Portfolio turnover rate 25%(d)
Net assets at end of period (000's) $ 55,692
CLASS A SHARES YEAR ENDED DECEMBER 31,
-------------------------------------------------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2003 2002 2001 2000(a)
NET ASSET VALUE, BEGINNING OF PERIOD $ 15.32 $ 18.35 $ 23.84 $ 28.67
INCOME FROM INVESTMENT OPERATIONS
Net investment income (b) 0.10 0.05 0.01 0.02
Net realized and unrealized gain (loss) 7.08 (3.07) (5.11) (1.26)
---------- ---------- ---------- ----------
Total from Investment Operations 7.18 (3.02) (5.10) (1.24)
---------- ---------- ---------- ----------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income (0.05) (0.01) -- --
From net realized gains -- -- (0.39) (3.59)
---------- ---------- ---------- ----------
Total Distributions Declared to Shareholders (0.05) (0.01) (0.39) (3.59)
---------- ---------- ---------- ----------
NET ASSET VALUE, END OF PERIOD $ 22.45 $ 15.32 $ 18.35 $ 23.84
========== ========== ========== ==========
Total Return (c) 46.94% (16.46)% (21.59)% (4.85)%(d)
---------- ---------- ---------- ----------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 1.59% 1.56% 1.65% 1.26%(g)(h)
Net investment income (f) 0.57% 0.30% 0.03% 0.73%(g)(h)
Reimbursement -- -- -- --
Portfolio turnover rate 40% 52% 45% 63%(d)
Net assets at end of period (000's) $ 52,872 $ 33,806 $ 25,587 $ 10,323
(a) Class A Shares were initially offered on October 16, 2000. Per share data
reflects activity from that date.
(b) Per share data was calculated using average shares outstanding during the
period.
(c) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(d) Not annualized.
(e) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(f) The benefits derived from custody fees paid indirectly had no impact.
(g) Annualized.
(h) The ratios of expenses and net investment loss to average net assets,
previously reported as 1.59% and 0.40% respectively, were revised to reflect
all classes specific expenses in this period.
(UNAUDITED)
SIX MONTHS
CLASS B SHARES ENDED JUNE 30,
--------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004
NET ASSET VALUE, BEGINNING OF PERIOD $ 22.07
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (b) 0.05
Net realized and unrealized gain (loss) 1.73
--------------
Total from Investment Operations 1.78
--------------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income (0.04)
From net realized gains --
--------------
Total Distributions Declared to Shareholders (0.04)
--------------
NET ASSET VALUE, END OF PERIOD $ 23.81
==============
Total Return (c) 8.07%(d)(e)
--------------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 2.32%(g)
Net investment income (loss) (f) 0.47%(g)
Reimbursement 0.01%(g)
Portfolio turnover rate 25%(d)
Net assets at end of period (000's) $ 45,081
CLASS B SHARES YEAR ENDED DECEMBER 31,
---------------------------------------------------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2003 2002 2001 2000(a)
NET ASSET VALUE, BEGINNING OF PERIOD $ 15.11 $ 18.22 $ 23.81 $ 28.67
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (b) (0.02) (0.06) (0.12) 0.01
Net realized and unrealized gain (loss) 6.98 (3.05) (5.08) (1.28)
---------- ---------- ---------- ---------
Total from Investment Operations 6.96 (3.11) (5.20) (1.27)
---------- ---------- ---------- ---------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income -- -- -- --
From net realized gains -- -- (0.39) (3.59)
---------- ---------- ---------- ---------
Total Distributions Declared to Shareholders -- -- (0.39) (3.59)
---------- ---------- ---------- ---------
NET ASSET VALUE, END OF PERIOD $ 22.07 $ 15.11 $ 18.22 $ 23.81
========== ========== ========== =========
Total Return (c) 46.06% (17.07)% (22.04)% (4.97)%(d)
---------- ---------- ---------- ---------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 2.24% 2.21% 2.30% 1.91%(g)(h)
Net investment income (loss) (f) (0.10)% (0.35)% (0.62)% 0.08%(g)(h)
Reimbursement -- -- -- --
Portfolio turnover rate 40% 52% 45% 63%(d)
Net assets at end of period (000's) $ 39,800 $ 22,560 $ 17,235 $ 5,675
(a) Class B Shares were initially offered on October 16, 2000. Per share data
reflects activity from that date.
(b) Per share data was calculated using average shares outstanding during the
period.
(c) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(d) Not annualized.
(e) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(f) The benefits derived from custody fees paid indirectly had no impact.
(g) Annualized.
(h) The ratios of expenses and net investment loss to average net assets,
previously reported as 2.24% and (0.25)% respectively, were revised to
reflect all classes specific expenses in this period.
(UNAUDITED)
SIX MONTHS
CLASS C SHARES ENDED JUNE 30,
--------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004
NET ASSET VALUE, BEGINNING OF PERIOD $ 22.06
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (b) 0.07
Net realized and unrealized gain (loss) 1.73
--------------
Total from Investment Operations 1.80
--------------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income (0.04)
From net realized gains --
--------------
Total Distributions Declared to Shareholders (0.04)
--------------
NET ASSET VALUE, END OF PERIOD $ 23.82
==============
Total Return (c) 8.17%(d)(e)
--------------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 2.20%(g)
Net investment income (loss) (f) 0.58%(g)
Reimbursement 0.01%(g)
Portfolio turnover rate 25%(d)
Net assets at end of period (000's) $ 25,023
CLASS C SHARES YEAR ENDED DECEMBER 31,
------------------------------------------------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2003 2002 2001 2000(a)
NET ASSET VALUE, BEGINNING OF PERIOD $ 15.11 $ 18.21 $ 23.81 $ 28.67
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (b) (0.01) (0.06) (0.13) 0.01
Net realized and unrealized gain (loss) 6.96 (3.04) (5.08) (1.28)
---------- ---------- ---------- ---------
Total from Investment Operations 6.95 (3.10) (5.21) (1.27)
---------- ---------- ---------- ---------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income -- -- -- --
From net realized gains -- -- (0.39) (3.59)
---------- ---------- ---------- ---------
Total Distributions Declared to Shareholders -- -- (0.39) (3.59)
---------- ---------- ---------- ---------
NET ASSET VALUE, END OF PERIOD $ 22.06 $ 15.11 $ 18.21 $ 23.81
========== ========== ========== =========
Total Return (c) 46.00% (17.02)% (22.08)% (4.97)%(d)
---------- ---------- ---------- ---------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 2.24% 2.21% 2.30% 1.91%(g)(h)
Net investment income (loss) (f) (0.06)% (0.35)% (0.62)% 0.08%(g)(h)
Reimbursement -- -- -- --
Portfolio turnover rate 40% 52% 45% 63%(d)
Net assets at end of period (000's) $ 22,990 $ 14,575 $ 14,327 $ 3,965
(a) Class C Shares were initially offered on October 16, 2000. Per share data
reflects activity from that date.
(b) Per share data was calculated using average shares outstanding during the
period.
(c) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(d) Not annualized.
(e) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(f) The benefits derived from custody fees paid indirectly had no impact.
(g) Annualized.
(h) The ratios of expenses and net investment loss to average net assets,
previously reported as 2.24% and (0.25)% respectively, were revised to
reflect all classes specific expenses in this period.
See accompanying notes to financial statements
63
COLUMBIA ACORN FAMILY OF FUNDS
>FINANCIAL HIGHLIGHTS CONTINUED
COLUMBIA ACORN USA
(UNAUDITED)
SIX MONTHS
CLASS A SHARES ENDED JUNE 30,
--------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004
NET ASSET VALUE, BEGINNING OF PERIOD $ 20.74
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (b) (0.13)
Net realized and unrealized gain (loss) 2.13
--------------
Total from Investment Operations 2.00
--------------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net realized gains --
--------------
Total Distributions Declared to Shareholders --
--------------
NET ASSET VALUE, END OF PERIOD $ 22.74
==============
Total Return (c) 9.64%(d)(e)
--------------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 1.53%(g)
Net investment loss (f) (1.16)%(g)
Reimbursement 0.01%(g)
Portfolio turnover rate 11%(d)
Net assets at end of period (000's) $ 103,174
CLASS A SHARES YEAR ENDED DECEMBER 31,
-----------------------------------------------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2003 2002 2001 2000(a)
NET ASSET VALUE, BEGINNING OF PERIOD $ 14.18 $ 17.50 $ 14.88 $ 13.83
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (b) (0.22) (0.19) (0.19) (0.01)
Net realized and unrealized gain (loss) 6.78 (3.13) 2.96 1.06
---------- ---------- ---------- --------
Total from Investment Operations 6.56 (3.32) 2.77 1.05
---------- ---------- ---------- --------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net realized gains -- -- (0.15) --
---------- ---------- ---------- --------
Total Distributions Declared to Shareholders -- -- (0.15) --
---------- ---------- ---------- --------
NET ASSET VALUE, END OF PERIOD $ 20.74 $ 14.18 $ 17.50 $ 14.88
========== ========== ========== ========
Total Return (c) 46.26% (18.97)% 18.65% 7.59%(d)
---------- ---------- ---------- --------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 1.65% 1.74% 1.84% 1.41%(g)(h)
Net investment loss (f) (1.26)% (1.21)% (1.13)% (0.73)%(g)(h)
Reimbursement -- -- -- --
Portfolio turnover rate 7% 31% 24% 45%(d)
Net assets at end of period (000's) $ 89,650 $ 32,422 $ 20,455 $ 798
(a) Class A Shares were initially offered on October 16, 2000. Per share data
reflects activity from that date.
(b) Per share data was calculated using average shares outstanding during the
period.
(c) Total return at net asset value assuming all distributions reinvested and
no initial sales charge or contingent deferred sales charge.
(d) Not annualized.
(e) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(f) The benefits derived from custody fees paid indirectly had no impact.
(g) Annualized.
(h) The ratios of expenses and net investment loss to average net assets,
previously reported as 1.17% and (0.49)% respectively, were revised to
reflect all class specific expenses in this period.
(UNAUDITED)
SIX MONTHS
CLASS B SHARES ENDED JUNE 30,
--------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004
NET ASSET VALUE, BEGINNING OF PERIOD $ 20.36
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (b) (0.20)
Net realized and unrealized gain (loss) 2.07
--------------
Total from Investment Operations 1.87
--------------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net realized gains --
--------------
Total Distributions Declared to Shareholders --
--------------
NET ASSET VALUE, END OF PERIOD $ 22.23
==============
Total Return (c) 9.18%(d)(e)
--------------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 2.27%(g)
Net investment loss (f) (1.90)%(g)
Reimbursement 0.01%(g)
Portfolio turnover rate 11%(d)
Net assets at end of period (000's) $ 70,114
CLASS B SHARES YEAR ENDED DECEMBER 31,
-----------------------------------------------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2003 2002 2001 2000(a)
NET ASSET VALUE, BEGINNING OF PERIOD $ 14.01 $ 17.40 $ 14.87 $ 13.83
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (b) (0.32) (0.29) (0.30) (0.03)
Net realized and unrealized gain (loss) 6.67 (3.10) 2.96 1.07
---------- ---------- ---------- --------
Total from Investment Operations 6.35 (3.39) 2.66 1.04
---------- ---------- ---------- --------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net realized gains -- -- (0.13) --
---------- ---------- ---------- --------
Total Distributions Declared to Shareholders -- -- (0.13) --
---------- ---------- ---------- --------
NET ASSET VALUE, END OF PERIOD $ 20.36 $ 14.01 $ 17.40 $ 14.87
========== ========== ========== ========
Total Return (c) 45.32% (19.48)% 17.92% 7.52%(d)
---------- ---------- ---------- --------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 2.30% 2.39% 2.49% 2.06%(g)(h)
Net investment loss (f) (1.91)% (1.86)% (1.78)% (1.38)%(g)(h)
Reimbursement -- -- -- --
Portfolio turnover rate 7% 31% 24% 45%(d)
Net assets at end of period (000's) $ 66,175 $ 37,478 $ 27,722 $ 685
(a) Class B Shares were initially offered on October 16, 2000. Per share data
reflects activity from that date.
(b) Per share data was calculated using average shares outstanding during the
period.
(c) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(d) Not annualized.
(e) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(f) The benefits derived from custody fees paid indirectly had no impact.
(g) Annualized.
(h) The ratios of expenses and net investment loss to average net assets,
previously reported as 1.82% and (1.14)% respectively, were revised to
reflect all class specific expenses in this period.
(UNAUDITED)
SIX MONTHS
CLASS C SHARES ENDED JUNE 30,
--------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004
NET ASSET VALUE, BEGINNING OF PERIOD $ 20.36
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (b) (0.20)
Net realized and unrealized gain (loss) 2.09
--------------
Total from Investment Operations 1.89
--------------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net realized gains --
--------------
Total Distributions Declared to Shareholders --
--------------
NET ASSET VALUE, END OF PERIOD $ 22.25
==============
Total Return (c) 9.28%(d)(e)
--------------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 2.21%(g)
Net investment loss (f) (1.84)%(g)
Reimbursement 0.01%(g)
Portfolio turnover rate 11%(d)
Net assets at end of period (000's) $ 38,992
CLASS C SHARES YEAR ENDED DECEMBER 31,
-----------------------------------------------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2003 2002 2001 2000(a)
NET ASSET VALUE, BEGINNING OF PERIOD $ 14.01 $ 17.40 $ 14.87 $ 13.83
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (b) (0.32) (0.29) (0.30) (0.03)
Net realized and unrealized gain (loss) 6.67 (3.10) 2.96 1.07
---------- ---------- ---------- --------
Total from Investment Operations 6.35 (3.39) 2.66 1.04
---------- ---------- ---------- --------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net realized gains -- -- (0.13) --
---------- ---------- ---------- --------
Total Distributions Declared to Shareholders -- -- (0.13) --
---------- ---------- ---------- --------
NET ASSET VALUE, END OF PERIOD $ 20.36 $ 14.01 $ 17.40 $ 14.87
========== ========== ========== ========
Total Return (c) 45.32% (19.48)% 17.92% 7.52%(d)
---------- ---------- ---------- --------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 2.30% 2.39% 2.49% 2.06%(g)(h)
Net investment loss (f) (1.91)% (1.86)% (1.78)% (1.38)%(g)(h)
Reimbursement -- -- -- --
Portfolio turnover rate 7% 31% 24% 45%(d)
Net assets at end of period (000's) $ 35,662 $ 18,313 $ 13,049 $ 347
(a) Class C Shares were initially offered on October 16, 2000. Per share data
reflects activity from that date.
(b) Per share data was calculated using average shares outstanding during the
period.
(c) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(d) Not annualized.
(e) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(f) The benefits derived from custody fees paid indirectly had no impact.
(g) Annualized.
(h) The ratios of expenses and net investment loss to average net assets,
previously reported as 1.82% and (1.14)% respectively, were revised to
reflect all class specific expenses in this period.
See accompanying notes to financial statements
64
1-800-922-6769
COLUMBIA ACORN INTERNATIONAL SELECT
(UNAUDITED)
SIX MONTHS
CLASS A SHARES ENDED JUNE 30,
--------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004
NET ASSET VALUE, BEGINNING OF PERIOD $ 14.45
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (b) 0.01
Net realized and unrealized gain (loss) 1.07
--------------
Total from Investment Operations 1.08
--------------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income (0.03)
From net realized gains --
--------------
Total Distributions Declared to Shareholders (0.03)
--------------
NET ASSET VALUE, END OF PERIOD $ 15.50
==============
Total Return (c) 7.46%(d)(e)
--------------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 1.80%(g)
Net investment income (loss) (f) 0.18%(g)
Reimbursement 0.33%(g)
Portfolio turnover rate 46%(e)
Net assets at end of period (000's) $ 3,194
CLASS A SHARES YEAR ENDED DECEMBER 31,
-----------------------------------------------------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2003 2002 2001 2000(a)
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.24 $ 12.07 $ 17.15 $ 17.71
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (b) 0.03 (0.01) (0.09) (0.03)
Net realized and unrealized gain (loss) 4.18 (1.82) (4.90) (0.53)
--------- --------- --------- ---------
Total from Investment Operations 4.21 (1.83) (4.99) (0.56)
--------- --------- --------- ---------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income -- -- (0.01) --
From net realized gains -- -- (0.08) --
--------- --------- --------- ---------
Total Distributions Declared to Shareholders -- -- (0.09) --
--------- --------- --------- ---------
NET ASSET VALUE, END OF PERIOD $ 14.45 $ 10.24 $ 12.07 $ 17.15
========= ========= ========= =========
Total Return (c) 41.11%(d) (15.16)%(d) (29.17)%(d) (3.16)%(e)
--------- --------- --------- ---------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 1.80% 1.80% 1.80% 1.68%(g)(h)
Net investment income (loss) (f) 0.24% (0.09)% (0.67)% (1.18)%(g)(h)
Reimbursement 0.44% 0.33% 0.23% --
Portfolio turnover rate 69% 102% 82% 79%(e)
Net assets at end of period (000's) $ 2,557 $ 2,612 $ 2,861 $ 3,172
(a) Class A Shares were initially offered on October 16, 2000. Per share data
reflects activity from that date.
(b) Per share data was calculated using average shares outstanding during the
period.
(c) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(d) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(e) Not annualized.
(f) The benefits derived from custody fees paid indirectly had no impact.
(g) Annualized.
(h) The ratios of expenses and net investment loss to average net assets,
previously reported as 1.29% and (0.79)% respectively, were revised to
reflect all class specific expenses in this period.
(UNAUDITED)
SIX MONTHS
CLASS B SHARES ENDED JUNE 30,
--------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004
NET ASSET VALUE, BEGINNING OF PERIOD $ 14.12
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (b) (0.04)
Net realized and unrealized gain (loss) 1.04
--------------
Total from Investment Operations 1.00
--------------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income --
From net realized gains --
--------------
Total Distributions Declared to Shareholders --
--------------
NET ASSET VALUE, END OF PERIOD $ 15.12
==============
Total Return (c) 7.08%(d)(e)
--------------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 2.45%(g)
Net investment loss (f) (0.50)%(g)
Reimbursement 0.55%(g)
Portfolio turnover rate 46%(e)
Net assets at end of period (000's) $ 3,928
CLASS B SHARES YEAR ENDED DECEMBER 31,
-----------------------------------------------------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2003 2002 2001 2000(a)
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.08 $ 11.96 $ 17.13 $ 17.71
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (b) (0.06) (0.08) (0.18) (0.05)
Net realized and unrealized gain (loss) 4.10 (1.80) (4.90) (0.53)
--------- --------- --------- ---------
Total from Investment Operations 4.04 (1.88) (5.08) (0.58)
--------- --------- --------- ---------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income -- -- (0.01) --
From net realized gains -- -- (0.08) --
--------- --------- --------- ---------
Total Distributions Declared to Shareholders -- -- (0.09) --
--------- --------- --------- ---------
NET ASSET VALUE, END OF PERIOD $ 14.12 $ 10.08 $ 11.96 $ 17.13
========= ========= ========= =========
Total Return (c) 40.08%(d) (15.72)%(d) (29.73)%(d) (3.27)%(e)
--------- --------- --------- ---------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 2.45% 2.45% 2.45% 2.33%(g)(h)
Net investment loss (f) (0.52)% (0.74)% (1.32)% (1.83)%(g)(h)
Reimbursement 0.44% 0.33% 0.23% --
Portfolio turnover rate 69% 102% 82% 79%(e)
Net assets at end of period (000's) $ 3,162 $ 1,835 $ 2,069 $ 1,551
(a) Class B Shares were initially offered on October 16, 2000. Per share data
reflects activity from that date.
(b) Per share data was calculated using average shares outstanding during the
period.
(c) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(d) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(e) Not annualized.
(f) The benefits derived from custody fees paid indirectly had no impact.
(g) Annualized.
(h) The ratios of expenses and net investment loss to average net assets,
previously reported as 1.94% and (1.44)% respectively, were revised to
reflect all class specific expenses in this period.
(UNAUDITED)
SIX MONTHS
CLASS C SHARES ENDED JUNE 30,
--------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004
NET ASSET VALUE, BEGINNING OF PERIOD $ 14.14
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (b) (0.05)
Net realized and unrealized gain (loss) 1.06
--------------
Total from Investment Operations 1.01
--------------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income --
From net realized gains --
--------------
Total Distributions Declared to Shareholders --
--------------
NET ASSET VALUE, END OF PERIOD $ 15.15
==============
Total Return (c) 7.14%(d)(e)
--------------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 2.45%(g)
Net investment loss (f) (0.63)%(g)
Reimbursement 0.32%(g)
Portfolio turnover rate 46%(e)
Net assets at end of period (000's) $ 2,094
CLASS C SHARES YEAR ENDED DECEMBER 31,
------------------------------------------------------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2003 2002 2001 2000(a)
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.09 $ 11.97 $ 17.14 $ 17.71
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (b) (0.05) (0.08) (0.18) (0.05)
Net realized and unrealized gain (loss) 4.10 (1.80) (4.90) (0.52)
--------- --------- --------- ---------
Total from Investment Operations 4.05 (1.88) (5.08) (0.57)
--------- --------- --------- ---------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income -- -- (0.01) --
From net realized gains -- -- (0.08) --
--------- --------- --------- ---------
Total Distributions Declared to Shareholders -- -- (0.09) --
--------- --------- --------- ---------
NET ASSET VALUE, END OF PERIOD $ 14.14 $ 10.09 $ 11.97 $ 17.14
========= ========= ========= =========
Total Return (c) 40.14%(d) (15.71)%(d) (29.71)%(d) (3.22)%(e)
--------- --------- --------- ---------
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 2.45% 2.45% 2.45% 2.33%(g)(h)
Net investment loss (f) (0.41)% (0.74)% (1.32)% (1.83)%(g)(h)
Reimbursement 0.44% 0.33% 0.23% --
Portfolio turnover rate 69% 102% 82% 79%(e)
Net assets at end of period (000's) $ 3,691 $ 2,915 $ 3,885 $ 3,399
(a) Class C Shares were initially offered on October 16, 2000. Per share data
reflects activity from that date.
(b) Per share data was calculated using average shares outstanding during the
period.
(c) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(d) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(e) Not annualized.
(f) The benefits derived from custody fees paid indirectly had no impact.
(g) Annualized.
(h) The ratios of expenses and net investment loss to average net assets,
previously reported as 1.94% and (1.44)% respectively, were revised to
reflect all class specific expenses in this period.
See accompanying notes to financial statements
65
COLUMBIA ACORN FAMILY OF FUNDS
>FINANCIAL HIGHLIGHTS CONTINUED
COLUMBIA ACORN SELECT (UNAUDITED)
SIX MONTHS
CLASS A SHARES ENDED JUNE 30, YEAR ENDED DECEMBER 31,
------------- ------------------------------------------------------
SELECTED DATA FOR A SHARE OUTSTANDING
THROUGHOUT EACH PERIOD 2004 2003 2002 2001 2000(a)
NET ASSET VALUE, BEGINNING OF PERIOD $ 18.01 $ 13.93 $ 15.17 $ 14.12 $ 13.47
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (b) (0.09) (0.20) (0.16) (0.10) (0.01)
Net realized and unrealized gain (loss) 1.38 4.37 (1.08) 1.18 0.86
------------- --------- --------- --------- --------
Total from Investment Operations 1.29 4.17 (1.24) 1.08 0.85
------------- --------- --------- --------- --------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income -- -- -- -- (0.01)
From net realized gains -- (0.09) -- (0.03) (0.19)
------------- --------- --------- --------- --------
Total Distributions Declared
to Shareholders -- (0.09) -- (0.03) (0.20)
------------- --------- --------- --------- --------
NET ASSET VALUE, END OF PERIOD $ 19.30 $ 18.01 $ 13.93 $ 15.17 $ 14.12
============= ========= ========= ========= ========
Total Return (c) 7.16%(d)(e) 29.95% (8.17)%(e) 7.65%(e) 6.32%(d)
------------- --------- --------- --------- --------
RATIOS TO AVERAGE NET ASSETS
Expenses 1.52%(f)(g) 1.63%(f) 1.70%(f) 1.70% 1.61%(f)(g)(h)
Net investment loss (0.92)%(f)(g) (1.15)%(f) (1.11)%(f) (0.79)% (0.62)%(f)(g)(h)
Reimbursement 0.01%(g) -- 0.10% 0.18% --
Portfolio turnover rate 19%(d) 16% 40% 82% 116%(d)
Net assets at end of period (000's) $ 384,079 $ 264,679 $ 31,742 $ 11,900 $ 3,267
(a) Class A Shares were initially offered on October 16, 2000. Per share data
reflects activity from that date.
(b) Per share data was calculated using average shares outstanding during the
period.
(c) Total return at net asset value assuming all distributions reinvested and
no initial sales charge or contingent deferred sales charge.
(d) Not annualized.
(e) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(f) The benefits derived from custody fees paid indirectly had no impact.
(g) Annualized.
(h) The ratios of expenses and net investment loss to average net assets,
previously reported as 0.76% and 0.23% respectively, were revised to
reflect all class specific expenses in this period.
(UNAUDITED)
SIX MONTHS
CLASS B SHARES ENDED JUNE 30, YEAR ENDED DECEMBER 31,
------------- ------------------------------------------------------
SELECTED DATA FOR A SHARE OUTSTANDING
THROUGHOUT EACH PERIOD 2004 2003 2002 2001 2000(a)
NET ASSET VALUE, BEGINNING OF PERIOD $ 17.64 $ 13.73 $ 15.05 $ 14.10 $ 13.47
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (b) (0.16) (0.29) (0.25) (0.20) (0.01)
Net realized and unrealized gain (loss) 1.36 4.29 (1.07) 1.18 0.84
------------- --------- --------- --------- --------
Total from Investment Operations 1.20 4.00 (1.32) 0.98 0.83
------------- --------- --------- --------- --------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income -- -- -- -- (0.01)
From net realized gains -- (0.09) -- (0.03) (0.19)
------------- --------- --------- --------- --------
Total Distributions Declared to
Shareholders -- (0.09) -- (0.03) (0.20)
------------- --------- --------- --------- --------
NET ASSET VALUE, END OF PERIOD $ 18.84 $ 17.64 $ 13.73 $ 15.05 $ 14.10
============= ========= ========= ========= ========
Total Return (c) 6.80%(d)(e) 29.14% (8.77)%(e) 6.95%(e) 6.17%(d)
------------- --------- --------- --------- --------
RATIOS TO AVERAGE NET ASSETS
Expenses 2.30%(f)(g) 2.28%(f) 2.35%(f) 2.35% 2.26%(f)(g)(h)
Net investment loss (1.70)%(f)(g) (1.80)%(f) (1.76)%(f) (1.44)% (1.27)%(f)(g)(h)
Reimbursement 0.01%(g) -- 0.10% 0.18% --
Portfolio turnover rate 19%(d) 16% 40% 82% 116%(d)
Net assets at end of period (000's) $ 156,718 $ 118,064 $ 33,106 $ 13,358 $ 4,249
(a) Class B Shares were initially offered on October 16, 2000. Per share data
reflects activity from that date.
(b) Per share data was calculated using average shares outstanding during the
period.
(c) Total return at net asset value assuming all distributions reinvested and
no initial sales charge or contingent deferred sales charge.
(d) Not annualized.
(e) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(f) The benefits derived from custody fees paid indirectly had no impact.
(g) Annualized.
(h) The ratios of expenses and net investment loss to average net assets,
previously reported as 1.41% and (0.42)% respectively, were revised to
reflect all class specific expenses in this period.
(UNAUDITED)
SIX MONTHS
CLASS C SHARES ENDED JUNE 30, YEAR ENDED DECEMBER 31,
- -------------- ------------- ------------------------------------------------------
SELECTED DATA FOR A SHARE OUTSTANDING
THROUGHOUT EACH PERIOD 2004 2003 2002 2001 2000(a)
NET ASSET VALUE, BEGINNING OF PERIOD $ 17.64 $ 13.73 $ 15.05 $ 14.10 $ 13.47
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (b) (0.15) (0.30) (0.25) (0.20) (0.01)
Net realized and unrealized gain (loss) 1.35 4.30 (1.07) 1.18 0.84
------------- --------- --------- --------- --------
Total from Investment Operations 1.20 4.00 (1.32) 0.98 0.83
------------- --------- --------- --------- --------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income -- -- -- -- (0.01)
From net realized gains -- (0.09) -- (0.03) (0.19)
------------- --------- --------- --------- --------
Total Distributions Declared to
Shareholders -- (0.09) -- (0.03) (0.20)
------------- --------- --------- --------- --------
NET ASSET VALUE, END OF PERIOD $ 18.84 $ 17.64 $ 13.73 $ 15.05 $ 14.10
============= ========= ========= ========= ========
Total Return (c) 6.80%(d)(e) 29.14% (8.77)%(e) 6.95%(e) 6.17%(d)
------------- --------- --------- --------- --------
RATIOS TO AVERAGE NET ASSETS
Expenses 2.25%(f)(g) 2.28%(f) 2.35%(f) 2.35% 2.26%(f)(g)(h)
Net investment loss (1.65)%(f)(g) (1.80)%(f) (1.76)%(f) (1.44)% (1.27)%(f)(g)(h)
Reimbursement 0.01%(g) -- 0.10% 0.18% --
Portfolio turnover rate 19%(d) 16% 40% 82% 116%(d)
Net assets at end of period (000's) $ 89,703 $ 64,212 $ 10,919 $ 4,945 $ 1,070
(a) Class C Shares were initially offered on October 16, 2000. Per share data
reflects activity from that date.
(b) Per share data was calculated using average shares outstanding during the
period.
(c) Total return at net asset value assuming all distributions reinvested and
no initial sales charge or contingent deferred sales charge.
(d) Not annualized.
(e) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(f) The benefits derived from custody fees paid
indirectly had no impact.
(g) Annualized.
(h) The ratios of expenses and net investment loss to average net assets,
previously reported as 1.41% and (0.42)% respectively, were revised to
reflect all class specific expenses in this period.
See accompanying notes to financial statements
66
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COLUMBIA ACORN FAMILY OF FUNDS
> NOTES TO FINANCIAL STATEMENTS, (UNAUDITED)
1. Nature of Operations
Columbia Acorn Fund, Columbia Acorn International, Columbia Acorn USA, Columbia
Acorn International Select and Columbia Acorn Select (the "Funds") are series of
Columbia Acorn Trust (the "Trust"), an open-end management investment company
organized as a Massachusetts business trust. The investment objective of each
Fund is to seek long-term growth of capital. The Funds may issue an unlimited
number of shares. The Funds offer four classes of shares: Class A, Class B,
Class C and Class Z.
Class A shares are sold with a front-end sales charge. A contingent
deferred sales charge ("CDSC") is assessed to Class A shares purchased without
an initial sales charge on redemptions made within eighteen months on an
original purchase of $1 million to $25 million.
Class B shares are subject to a CDSC. Class B shares will convert to Class
A shares in three, four or eight years after purchase, depending on the program
under which shares are purchased.
Class C shares are subject to a CDSC on redemptions made within one year
after purchase.
Class Z shares are offered continuously at net asset value. There are
certain restrictions on the purchase of Class Z shares. Generally, you may
exchange your Class Z or Class A shares of the Fund for shares of another fund
at no additional charge. However, if you exchange Class Z shares of Columbia
Acorn International or Columbia Acorn International Select that you have owned
60 days or less for Class Z shares of a fund distributed by Columbia Funds
Distributor, Inc., that does not have a redemption fee (including Columbia Acorn
Fund, Columbia Acorn USA and Columbia Acorn Select), the Fund will charge you a
redemption fee of 2% of the redemption proceeds. Exchanges between Columbia
Acorn International and Columbia Acorn International Select (or a fund
distributed by Columbia Funds Distributor, Inc. that has a redemption fee) will
not be subject to the 2% redemption fee. In addition, if you redeem shares of
Columbia Acorn International or Columbia Acorn International Select that you
have owned 60 days or less, the Fund will charge you a redemption fee of 2% of
redemption proceeds, with certain exceptions. See "Fund Policy on Trading of
Fund Shares and Redemption Fees" as disclosed within the Funds' prospectus for
more information.
The financial highlights for Class Z shares are presented in a separate
semi-annual report. The semi-annual financial statements for the Columbia
Thermostat Fund, another Fund of the Trust, begins on page 73 of this report.
Investment income, realized and unrealized gains and losses, and certain
fund-level expenses are borne pro rata on the basis of the relative net assets
of all classes, except each class bears certain expenses unique to that class
such as distribution services, transfer agent, and certain other class specific
expenses. Differences in class expenses may result in payment of different
dividend distributions for each class. All the share classes of the Trust have
equal rights with respect to voting subject to class specific arrangements.
2. Significant Accounting Policies
>Security valuation
Securities of the Funds are valued at marked value or, if a market quotation for
a security is not readily available or is deemed not to be reliable because of
events or circumstances that have occurred between the market quotation and the
time as of which the security is to be valued, the security is valued at a fair
value determined in accordance with procedures established by the Board of
Trustees. Securities traded on securities exchanges or in over-the-counter
markets in which transaction prices are reported are valued at the last sales
price at the time of valuation. If a security is traded principally on the
Nasdaq Stock Market Inc., the Nasdaq Official Closing Price will be applied.
Securities for which there are no reported sales on the valuation date are
valued at the latest bid quotation. Short-term debt obligations having a
maturity of 60 days or less from the valuation date are valued on an amortized
cost basis, which approximates fair value. Securities for which quotations are
not available are valued at a fair value as determined in good faith by the
Board of Trustees. The Funds may use a systematic fair valuation model provided
by an independent third party to value securities principally traded in foreign
markets in order to adjust for possible stale pricing that may occur between the
close of the foreign exchanges and the time for valuation. If a security is
valued at a "fair value", that value is likely to be different from the last
quoted market price for the security.
67
COLUMBIA ACORN FAMILY OF FUNDS
>NOTES TO FINANCIAL STATEMENTS (UNAUDITED), CONTINUED
>Repurchase agreements
The Funds may engage in repurchase agreement transactions. The Funds, through
their custodians, receive delivery of underlying securities collateralizing
repurchase agreements. The Funds' investment advisor determines that the value
of the underlying securities is at all times at least equal to the resale price.
In the event of default or bankruptcy by the other party to the agreement,
realization and/or retention of the collateral may be subject to legal
proceedings.
>Foreign currency translations
Values of investments denominated in foreign currencies are converted into U.S.
dollars using the spot market rate of exchange at the time of valuation.
Purchases and sales of investments and dividend and interest income are
translated into U.S. dollars using the spot market rate of exchange prevailing
on the respective dates of such transactions. The gain or loss resulting from
changes in foreign exchange rates is included with net realized and unrealized
gain or loss from investments, as appropriate.
>Security transactions and investment income
Security transactions are accounted for on the trade date (date the order to buy
or sell is executed) and dividend income is recorded on the ex-dividend date,
except that certain dividends from foreign securities are recorded as soon as
the information is available to the Funds. Interest income is recorded on the
accrual basis and includes amortization of discounts on short-term debt
obligations and long-term debt obligations when required for federal income tax
purposes. Realized gains and losses from security transactions are reported on
an identified cost basis.
Awards from class action litigation may be recorded as a reduction of cost.
If the Funds no longer own the applicable securities, the proceeds are recorded
as realized gains.
The Funds estimate components of distributions from Real Estate Investment
Trusts (REITs). Distributions received in excess of income are recorded as a
reduction of the cost of the related investments. Results of operations for the
year reflect a change in estimate of these components using more current tax
reporting received from REIT investments. The change in estimate had no impact
on each of the Fund's net assets.
>Use of estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and accompanying notes.
Actual results may differ from those estimates.
>Financial instruments
Each Fund may purchase or sell exchange-traded financial futures contracts,
which are contracts that obligate that Fund to make or take delivery of a
financial instrument or the cash value of a securities index at a specified
future date at a specified price. The Funds enter into such contracts to hedge a
portion of their portfolio. Gains and losses are reflected as "Net Realized Gain
(Loss) on Futures" in the Statements of Operations. Additionally, each Fund,
except for Columbia Acorn USA and Columbia Acorn Select, may engage in portfolio
hedging with respect to changes in foreign currency exchange rates by entering
into forward foreign currency contracts to purchase or sell foreign currencies.
The Statements of Operations reflect gains and losses as realized for closed
forward foreign currency contracts and unrealized for open contracts. The Funds
bear the market risk that arises from changes in the value of financial
instruments and securities indices (futures contracts) or from changes in
foreign currency rates (forward foreign currency contracts) and the credit risk
should a counterparty fail to perform under such contracts.
None of the Funds entered into any futures contracts or forward foreign
currency contracts during the six months ended June 30, 2004.
>Fund share valuation
Fund shares are sold and redeemed on a continuing basis at net asset value. Net
asset value per share is determined daily as of the close of trading on the New
York Stock Exchange on each day the Exchange is open for trading. All income,
expenses (other than the Class A, Class B and Class C 12b-1 service and
distribution fees, and Class A, Class B, Class C and Class Z shares Transfer
Agent fees) and realized and unrealized gains (losses) of a fund are allocated
to each class proportionately on a daily basis for purposes of determining the
net asset value of each class. Redemption fees are allocated to paid-in-capital
of each class proportionately for the purposes of determining net asset value of
each class.
68
1-800-922-6769
>Custody fees
Custody fees are reduced based on each Fund's cash balances maintained with the
custodian. The amount is disclosed as a reduction of total expenses in the
Statement of Operations.
>Federal income taxes
The Funds have complied with the special provisions of the Internal Revenue Code
available to regulated investment companies and, in the manner provided therein,
distribute all their taxable income, as well as any net realized gain on sales
of investments and foreign currency transactions reportable for federal income
tax purposes. Accordingly, the Fund paid no federal income taxes and no federal
income tax provision was required.
>Foreign capital gains taxes
Realized gains in certain countries may be subject to foreign taxes at the fund
level, at rates ranging from approximately 10% to 30%. The Funds accrue for such
foreign taxes on net realized and unrealized gains at the appropriate rate for
each jurisdiction.
>Distributions to shareholders
Distributions to shareholders are recorded on the ex-date.
3. FEDERAL TAX INFORMATION
The tax character of distributions paid during the year ended December 31, 2003
was as follows:
LONG-
TERM
ORDINARY CAPITAL
DECEMBER 31, 2003 INCOME GAINS
- ----------------- ------------- -------------
(IN THOUSANDS)
Columbia Acorn Fund $ -- $ 9,917
Columbia Acorn International 5,935 --
Columbia Acorn USA -- --
Columbia Acorn International Select 19 --
Columbia Acorn Select 736 3,445
For the year ended December 31, 2003, the following capital loss carryforwards
are available to reduce taxable income arising from future net realized gains on
investments, if any, to the extent permitted by the Internal Revenue Code:
COLUMBIA COLUMBIA
YEAR OF ACORN ACORN
EXPIRATION INTERNATIONAL USA
- ---------- ------------- -------------
(IN THOUSANDS)
2009 $ 111,479 $ 3,035
2010 76,335 10,064
2011 48,476 --
------------- -------------
TOTAL $ 236,290 $ 13,099
COLUMBIA
ACORN
YEAR OF INTERNATIONAL
EXPIRATION SELECT
- ---------- -------------
(IN THOUSANDS)
2009 $ 23,084
2010 12,528
2011 2,488
-------------
TOTAL $ 38,100
Columbia Acorn Fund and Columbia Acorn International have elected to
mark-to-market their investments in Passive Foreign Investment Companies
("PFIC's") for federal income tax purposes. Gains and losses relating to PFIC's
are treated as ordinary income for federal income tax purposes. A summary of
transactions relating to PFIC's is as follows (in thousands):
COLUMBIA ACORN FUND
- -------------------
Cumulative unrealized appreciation
on PFIC's recognized in prior years
at December 31, 2002 $ 409
Unrealized appreciation (depreciation)
on PFIC's recognized for federal income
tax purposes during 2003 --
Unrealized appreciation recognized in
prior years on PFIC's sold during 2003 (409)
-------------
Cumulative unrealized appreciation on
PFIC's carried forward at December 31, 2003 $ --
-------------
COLUMBIA ACORN INTERNATIONAL
- ----------------------------
Cumulative unrealized appreciation
on PFIC's recognized in prior years
at December 31, 2002 $ 7,225
Unrealized appreciation (depreciation)
on PFIC's recognized for federal income
tax purposes during 2003 1,215
Unrealized appreciation recognized in
prior years on PFIC's sold during 2003 (7,225)
-------------
Cumulative unrealized appreciation on
PFIC's carried forward at December 31, 2003 $ 1,215
-------------
4. TRANSACTIONS WITH AFFILIATES
Columbia Wanger Asset Management, L.P. ("Columbia WAM"), an indirect
wholly-owned subsidiary of Columbia Management Group, Inc., which in turn is a
wholly-owned subsidiary of Bank of America Corporation ("BOA") furnishes
continuing investment supervision to the Funds and is responsible for the
overall management of the Funds' business affairs. Prior to April 1, 2004,
Columbia Management Group, Inc. was a wholly-owned subsidiary of Fleet National
Bank, which in turn was a wholly-owned subsidiary of FleetBoston Financial
Corporation ("Fleet"). On April 1, 2004, Fleet was acquired by BOA.
69
COLUMBIA ACORN FAMILY OF FUNDS
>NOTES TO FINANCIAL STATEMENTS (UNAUDITED), CONTINUED
Under the Funds' investment management agreement, fees are accrued daily
and paid monthly to Columbia WAM at the annual rates shown in the table below
for each fund.
COLUMBIA ACORN FUND
- --------------------------------------------------------------------------------
Net asset value:
On the first $700 million 0.75%
Next $1.3 billion 0.70%
Net assets in excess of $2 billion 0.65%
COLUMBIA ACORN INTERNATIONAL
- --------------------------------------------------------------------------------
Net asset value:
On the first $100 million 1.20%
Next $400 million 0.95%
Net assets in excess of $500 million 0.75%
COLUMBIA ACORN USA
- --------------------------------------------------------------------------------
Net asset value:
On the first $200 million 0.95%
Net assets in excess of $200 million 0.90%
COLUMBIA ACORN INTERNATIONAL SELECT
- --------------------------------------------------------------------------------
On average daily net assets: 0.95%
COLUMBIA ACORN SELECT
- --------------------------------------------------------------------------------
On average daily net assets: 0.90%
Effective August 1, 2004:
Net asset value:
On the first $700 million 0.90%
Net assets in excess of $700 million 0.85%
>Expense Limit
Columbia WAM has voluntarily agreed to reimburse the ordinary operating expenses
(exclusive of 12b-1 service and distribution fees, interest, taxes and
extraordinary expenses, if any) exceeding 1.45% of the average annual net assets
for Columbia Acorn International Class A, Class B and Class C shares and 1.35%
of the average annual net assets for Columbia Acorn Select Class A, Class B and
Class C shares.
Columbia WAM also provides administrative services to each Fund at an
annual rate of 0.05% of average daily net assets.
Effective August 1, 2004 Columbia WAM will receive an administration fee
from the Funds, based on average daily net assets of the Trust, at the following
annual rates:
COLUMBIA ACORN TRUST
- --------------------
Average daily net asset value:
On the first $8 billion 0.05%
Next $8 billion 0.04%
Average daily net assets in excess of $16 billion 0.03%
Columbia Funds Distributor, Inc. ("CFDI"), an indirect wholly-owned
subsidiary of BOA, is the Funds' principal underwriter and receives no
compensation on the sale of Class Z shares.
For the six months ended June 30, 2004, Columbia Acorn Fund, Columbia Acorn
International, Columbia Acorn USA, Columbia Acorn International Select and
Columbia Acorn Select have been advised that CFDI retained $669,879 in
underwriting discounts on the sale of Class A shares and received CDSCs of
$16,312, $1,457,101, $109,925, respectively, on Class A, Class B and Class C
share redemptions.
Each Fund has adopted a 12b-1 plan which requires it to pay CFDI a monthly
service fee equal to 0.25% annually of the average daily net assets attributable
to Class A, Class B and Class C shares. The 12b-1 plan also requires each Fund
to pay CFDI a monthly distribution fee equal to 0.10%, 0.75% and 0.75%,
annually, of the average daily net assets attributable to Class A, Class B and
Class C shares, respectively. Effective August 1, 2004, each Fund's Class A
share 12b-1 fee was reduced to 25 basis points, resulting in the elimination of
the 10 basis point distribution fee on Class A shares. In addition, each Fund's
12b-1 fee for Class B shares was reduced from 100 basis points to 85 basis
points, decreasing the distribution portion of the 12b-1 fee to 60 basis points.
Columbia Funds Services, Inc. (the "Transfer Agent"), an indirect,
wholly-owned subsidiary of BOA, provides shareholder services to the Funds. For
such services, the Transfer Agent receives a fee, paid monthly, at the annual
rate of $28.00 per open account. The Transfer Agent also receives reimbursement
for certain out-of-pocket expenses. Effective February 1, 2004 the Transfer
Agent made the decision to waive the reimbursement for certain out-of-pocket
expenses. Prior to February 1, 2004, the Transfer Agent was entitled to receive
a monthly transfer agent fee at the annual rate of 0.07% of the average daily
net assets attributable to Class A, Class B and Class C shares plus flat-rate
charges based on the number of shareholder accounts and transactions.
Certain officers and trustees of the Trust are also officers of Columbia
WAM. The Trust makes no direct payments to its officers and trustees who are
affiliated with Columbia WAM. Trustees' fees and expenses paid by the Funds for
the six months ended June 30, 2004 were as follows, including each Fund's
portion of a special payment
70
1-800-922-6769
to the chairman of the board of $25,000 for extraordinary time and effort spent
on board matters during 2003:
- --------------------------------------------------------------------------------
(IN THOUSANDS)
Columbia Acorn Fund $ 209
Columbia Acorn International 34
Columbia Acorn USA 13
Columbia Acorn International Select 3
Columbia Acorn Select 8
================================================================================
The Trust provides a deferred compensation plan for its trustees. Under
that plan, a trustee may elect to defer all or a portion of his or her
compensation. Amounts deferred are retained by the Trust and represent an
unfunded obligation of the Trust. The value of amounts deferred is determined by
reference to the change in value of Class Z shares of one or more series of the
Trust or a money market fund as specified by the trustee. Benefits under the
deferred compensation plan are payable upon retirement.
An affiliate may include any company in which a fund owns five percent or
more of its outstanding voting securities. On June 30, 2004, Columbia Acorn Fund
and Columbia Acorn USA each held five percent or more of the outstanding voting
securities of one or more companies. Details of investments in those affiliated
companies are presented on pages 33 and 47, respectively.
During the six months ended June 30, 2004, the Funds engaged in purchase
and sale transactions with funds that have a common investment advisor (or
affiliated investment advisors), common Directors/Trustees, and/or common
Officers. Those transactions complied with Rule 17a-7 under the Investment
Company Act of 1940 and were as follows:
FUNDS PURCHASES SALES
- --------------------------------------------------------------------------------
(IN THOUSANDS)
Columbia Acorn Fund $ 27,980 $ 741
Columbia Acorn International 3,657 13,528
Columbia Acorn USA -- 1,111
Columbia Acorn International Select 608 4,794
Columbia Acorn Select -- --
5. BORROWING ARRANGEMENTS
The Trust participates in a $150 million credit facility, which was entered into
to facilitate portfolio liquidity. No amounts have been borrowed under this
facility for the six months ended June 30, 2004.
6. INVESTMENT TRANSACTIONS
The aggregate cost of purchases and proceeds from sales other than short-term
obligations for the six months ended June 30, 2004 were:
COLUMBIA ACORN FUND
- --------------------------------------------------------------------------------
(IN THOUSANDS)
Investment securities
Purchases $ 1,694,313
Proceeds from sales 1,235,992
================================================================================
COLUMBIA ACORN INTERNATIONAL
- --------------------------------------------------------------------------------
(IN THOUSANDS)
Investment securities
Purchases $ 414,826
Proceeds from sales 486,377
================================================================================
COLUMBIA ACORN USA
- --------------------------------------------------------------------------------
(IN THOUSANDS)
Investment securities
Purchases $ 74,090
Proceeds from sales 78,807
================================================================================
COLUMBIA ACORN INTERNATIONAL SELECT
- --------------------------------------------------------------------------------
(IN THOUSANDS)
Investment securities
Purchases $ 19,664
Proceeds from sales 20,833
================================================================================
COLUMBIA ACORN SELECT
- --------------------------------------------------------------------------------
(IN THOUSANDS)
Investment securities
Purchases $ 296,012
Proceeds from sales 153,883
================================================================================
7. LEGAL PROCEEDINGS
The Securities and Exchange Commission (the "SEC"), the New York Attorney
General (the "NYAG") and various other regulatory authorities are investigating
late trading and market timing in mutual fund shares, and have sent information
requests and subpoenas to certain affiliates of Columbia Management Group, Inc.
("CMG") (collectively, "Columbia"). These affiliates include CFDI, Columbia
Management Advisors, Inc. ("CMA"), and Columbia WAM. CMA is the adviser to the
Columbia Family of Funds, but is not the adviser to the Columbia Acorn Family of
Funds. Columbia has not uncovered any instances where any of its affiliates were
knowingly involved in late trading of mutual fund shares.
On February 24, 2004, the SEC filed a civil complaint in the United States
District Court for the District of Massachusetts against CFDI and CMA, alleging
that they had violated certain provisions of the federal securities laws in
connection with trading activity in mutual fund
71
COLUMBIA ACORN FAMILY OF FUNDS
>NOTES TO FINANCIAL STATEMENTS (UNAUDITED), CONTINUED
shares. Also on February 24, 2004, the NYAG filed a civil complaint in New York
Supreme Court, County of New York against CFDI and CMA alleging that CFDI and
CMA had violated certain New York anti-fraud statutes. Both complaints are based
on arrangements between 1998 and 2003 with nine investors for the trading of
mutual fund shares. Neither complaint was filed against Columbia WAM nor the
Columbia Acorn Family of Funds. However, the complaints against CFDI and CMA
identified Columbia Acorn Fund, Columbia Acorn International and Columbia Acorn
International Select as funds in which one or more of the nine investors
invested. If either CFDI or CMA were unsuccessful in its defense of those
proceedings, it could be barred from serving as a distributor or investment
adviser for any investment company registered under the Investment Company Act
of 1940, as amended (a "registered investment company"), which could prevent
CFDI from serving as the Funds' distributor and could affect the ability of an
affiliated person of CFDI or CMA to serve as a distributor or investment adviser
for any registered investment company. The Funds have been informed by CFDI
that, in such a situation, it will seek exemptive relief from the SEC to permit
it to continue to serve as the Funds' distributor. There is no assurance that
such exemptive relief would be granted.
On March 15, 2004, CFDI and CMA entered into agreements in principle with
the SEC Division of Enforcement and NYAG in settlement of the charges. Under the
agreements, CFDI and CMA agreed, among other things, to the following
conditions: payment of $70 million in disgorgement; payment of $70 million in
civil penalties; an order requiring CFDI and CMA to cease and desist from
violations of the antifraud provisions and other provisions of the federal
securities laws; governance changes designed to maintain the independence of the
mutual fund boards of trustees and ensure compliance with securities laws and
fiduciary duties; and retention of an independent consultant to review CFDI's
and CMA's compliance policies and procedures. The agreement requires the final
approval of the SEC. In a separate agreement with the NYAG, Columbia has agreed
to reduce mutual fund fees by $80 million over a five-year period.
The Trust and Columbia WAM are defendants in several derivative and class
action lawsuits that allege, in summary, defendants permitted investors to
engage in improper trading of shares of various funds in violation of certain
federal and state laws. The Trust and Columbia WAM are also defendants in a
class action lawsuit that alleges, in summary, that the Trust and Columbia WAM
exposed shareholders of Columbia Acorn International Fund to trading by market
timers by allegedly (a) failing to properly evaluate daily whether a significant
event affecting the value of that Fund's securities had occurred after foreign
markets had closed but before the calculation of the Fund's net asset value
("NAV"); (b) failing to implement the Fund's portfolio valuation and share
pricing policies and procedures; and (c) failing to know and implement
applicable rules and regulations concerning the calculation of NAV (the "Fair
Valuation Lawsuit"). All of these lawsuits have been transferred to a federal
court in Maryland, where they will be consolidated with similar suits in a
Multi-District Litigation proceeding.
The Trust and Columbia WAM are defendants in a class action lawsuit in
Illinois state court similar to the Fair Valuation Lawsuit. Lastly, Columbia WAM
is also defendant in a lawsuit alleging that Columbia WAM used Fund assets to
make undisclosed payments to brokers as an incentive for the brokers to market
the Funds over other mutual funds to investors. The complaint alleges Columbia
WAM breached certain common law duties and federal laws.
The Trust and Columbia WAM intend to defend these suits vigorously. The
Trust does not believe that the pending actions will have a material adverse
effect on the financial statements of any Fund, and Columbia WAM does not
believe that the pending actions will have a material adverse effect on its
ability to perform under its contracts with the Funds.
As a result of these matters or any adverse publicity or other developments
resulting from them, there may be increased redemptions or reduced sales of Fund
shares, which could increase transaction costs or operating expenses, or have
other adverse consequences for the Funds.
In connection with the events described in detail above, various parties
have filed suit against certain funds, their Boards and/or Fleet (and affiliated
entities). These suits and certain regulatory investigations are ongoing.
Accordingly, an estimate of the financial impact of this litigation on any fund,
if any, cannot currently be made.
For the six months ended June 30, 2004, CMG has assumed consulting services
and fees incurred by the Funds in connection with these matters as follows:
- --------------------------------------------------------------------------------
(IN THOUSANDS)
Columbia Acorn Fund $ 135
Columbia Acorn International 20
Columbia Acorn USA 8
Columbia Acorn International Select 1
Columbia Acorn Select 10
================================================================================
72
1-800-922-6769
COLUMBIA THERMOSTAT FUND
>STATEMENT OF INVESTMENTS (UNAUDITED), JUNE 30, 2004
NUMBER OF SHARES
OR PRINCIPAL AMOUNT (000) VALUE (000)
- ----------------------------------------------------------------------------
>BOND FUNDS: 49.8%
5,107 Columbia Intermediate Bond Fund,
Class Z $ 45,657
2,604 Columbia Federal Securities Fund,
Class Z 27,416
2,146 Columbia High Yield Fund, Class Z 18,221
- ----------------------------------------------------------------------------
TOTAL BOND FUNDS (COST: $92,408) 91,294
>STOCK FUNDS: 49.7%
2,519 Columbia Growth Stock Fund,
Class Z (b) 22,745
1,345 Columbia Growth & Income Fund,
Class Z 22,736
746 Columbia Acorn Fund, Class Z 18,320
525 Columbia Mid-Cap Value Fund,
Class Z (b) 13,694
699 Columbia Acorn Select, Class Z (b) 13,670
- ----------------------------------------------------------------------------
TOTAL STOCK FUNDS (COST: $78,577) 91,165
>SHORT-TERM OBLIGATIONS: 0.5%
$ 1,008 Repurchase Agreement with State
Street Bank & Trust, Co. Dated
6/30/04, Due 7/01/04 at 1.30%
Collateralized by Federal Home
Loan Mortgage Corporation,
Notes, Maturing 2/15/05, Market
Value $1,031 (Repurchase
proceeds: $1,008) 1,008
- ----------------------------------------------------------------------------
(COST: $1,008) 1,008
-------------
TOTAL INVESTMENTS: 100.0% 183,467
(COST: $171,993) (a)
CASH AND OTHER ASSETS LESS LIABILITIES: (0.0%) (55)
-------------
TOTAL NET ASSETS: 100% $ 183,412
============================================================================
>NOTES TO STATEMENT OF INVESTMENTS (IN THOUSANDS)
(a) At June 30, 2004, for federal income tax purposes cost of investments was
the same and net unrealized appreciation was $11,474 consisting of gross
unrealized appreciation of $12,704 and gross unrealized depreciation of
$1,230.
73
COLUMBIA THERMOSTAT FUND
>STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
JUNE 30, 2004
- -------------------------------------------------------------------------------
(IN THOUSANDS)
ASSETS
Investments, at value (cost: $171,993) $ 183,467
Receivable for:
Investments sold 463
Fund shares sold 1,023
Dividends and interest 347
Expense reimbursement due from Advisor 30
Other Assets 3
----------------
Total Assets 185,333
LIABILITIES
Payable for:
Investments purchased 789
Fund shares redeemed 991
Transfer agent fees 16
Custody fees 4
Registration & blue sky fees 14
12b-1 Service & Distribution fees 100
Legal & audit fees 7
----------------
Total Liabilities 1,921
----------------
NET ASSETS $ 183,412
================
COMPOSITION OF NET ASSETS
Paid in capital $ 170,738
Undistributed net investment income 1,244
Accumulated net realized loss (44)
Net unrealized appreciation on investments 11,474
----------------
NET ASSETS $ 183,412
================
Net asset value per share -- Class A (a) $ 12.61
(Net assets/shares) ($67,687/5,370)
Maximum offering price per share -- Class A (b) $ 13.38
(Net asset value per share/front-end sales charge) ($12.61/0.9425)
Net asset value and offering price per share -- Class B (a) $ 12.58
(Net assets/shares) ($69,753/5,543)
Net asset value and offering price per share -- Class C (a) $ 12.58
(Net assets/shares) ($28,944/2,300)
Net asset value, offering and redemption price per
share -- Class Z $ 12.63
(Net assets/shares) ($17,028/1,348)
(a) Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
(b) On sales of $50,000 or more the offering price is reduced.
See accompanying notes to financial statements.
74
1-800-922-6769
COLUMBIA THERMOSTAT FUND
>STATEMENT OF OPERATIONS (UNAUDITED)
FOR THE SIX MONTHS ENDED JUNE 30, 2004
(IN THOUSANDS)
- ----------------------------------------------------------------------------
INVESTMENT INCOME:
Dividends from investment company shares $ 1,947
Interest income 5
-------------
Total Investment Income 1,952
EXPENSES:
Management fee 80
Administration fee 40
12b-1 Service and Distribution fees:
Class A 98
Class B 312
Class C 127
Transfer agent fees:
Class A 46
Class B 70
Class C 25
Class Z 15
Trustees fees 1
Custody fees 12
Registration & blue sky fees 59
Legal & audit fees 14
Non-recurring costs (See Note 7) 2
Other expenses 27
-------------
Total expenses 928
Less custody fees paid indirectly --*
Less fees waived by Distributor (28)
Less reimbursement of expenses by Advisor (190)
Non-recurring costs reimbursed (See Note 7) (2)
-------------
Net Expenses 708
-------------
Net Investment Income 1,244
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on:
Investments (28)
Distributions from investment company shares 23
-------------
Net realized loss (5)
-------------
Net change in net unrealized appreciation on investments 2,195
-------------
Net realized and unrealized gain 2,190
-------------
Net Increase in Net Assets resulting from Operations $ 3,434
=============
*Rounds to less than $500.
See accompanying notes to financial statements.
75
COLUMBIA THERMOSTAT FUND
>STATEMENT OF CHANGES IN NET ASSETS
(UNAUDITED)
SIX MONTHS YEAR ENDED
INCREASE IN NET ASSETS ENDED JUNE 30, DECEMBER 31,
- ------------------------------------------------------------------------------------------------
(IN THOUSANDS) 2004 2003 (a)
OPERATIONS:
Net investment income $ 1,244 $ 696
Net realized gain (loss) on investments and distributions from
investment company shares (5) 272
Net change in net unrealized appreciation on investments 2,195 9,219
-------------- ------------
Net Increase from Operations 3,434 10,187
DISTRIBUTION TO SHAREHOLDERS FROM:
Net investment income -- Class A -- (395)
Net realized gain -- Class A (89) (21)
Net investment income -- Class B -- (108)
Net realized gain -- Class B (94) (30)
Net investment income -- Class C -- (43)
Net realized gain -- Class C (40) (10)
Net investment income -- Class Z -- (160)
Net realized gain -- Class Z (22) (14)
-------------- ------------
Total Distributions to Shareholders (245) (781)
SHARE TRANSACTIONS:
Subscriptions -- Class A 27,577 40,815
Distributions reinvested -- Class A 80 373
Redemptions -- Class A (3,455) (1,441)
-------------- ------------
Net Increase -- Class A 24,202 39,747
Subscriptions -- Class B 20,217 48,741
Distributions reinvested -- Class B 86 125
Redemptions -- Class B (3,207) (1,176)
-------------- ------------
Net Increase -- Class B 17,096 47,690
Subscriptions -- Class C 9,956 19,668
Distributions reinvested -- Class C 34 44
Redemptions -- Class C (1,584) (1,015)
-------------- ------------
Net Increase -- Class C 8,406 18,697
Subscriptions -- Class Z 4,377 9,094
Distributions reinvested -- Class Z 22 166
Redemptions -- Class Z (1,809) (1,023)
-------------- ------------
Net Increase -- Class Z 2,590 8,237
-------------- ------------
Net Increase from Share Transactions 52,294 114,371
-------------- ------------
Total Increase in Net Assets 55,483 123,777
-------------- ------------
NET ASSETS:
Beginning of period 127,929 4,152
-------------- ------------
End of period $ 183,412 $ 127,929
============== ============
UNDISTRIBUTED NET INVESTMENT INCOME $ 1,244 $ --
============== ============
(a) Class A, Class B and Class D commenced operations March 3, 2003. On October
13, 2003, Class D was redesignated Class C.
See accompanying notes to financial statements.
76
1-800-922-6769
(UNAUDITED)
SIX MONTHS PERIOD ENDED
CHANGES IN SHARES OF BENEFICIAL INTEREST: ENDED JUNE 30, DECEMBER 31,
- ------------------------------------------------------------------------------------------------
(IN THOUSANDS) 2004 2003 (a)
Subscriptions -- Class A 2,219 3,529
Shares issued in reinvestment and capital gains -- Class A 7 31
Less shares redeemed -- Class A (293) (123)
-------------- ------------
Net increase -- Class A 1,933 3,437
Subscriptions -- Class B 1,614 4,268
Shares issued in reinvestment and capital gains -- Class B 7 10
Less shares redeemed -- Class B (257) (99)
-------------- ------------
Net increase -- Class B 1,364 4,179
Subscriptions -- Class C 793 1,712
Shares issued in reinvestment and capital gains -- Class C 3 4
Less shares redeemed -- Class C (127) (85)
-------------- ------------
Net increase -- Class C 669 1,631
Subscriptions -- Class Z 349 821
Shares issued in reinvestment and capital gains -- Class Z 2 14
Less shares redeemed -- Class Z (146) (91)
-------------- ------------
Net increase -- Class Z 205 744
-------------- ------------
Net increase in Shares of Beneficial Interest 4,171 9,991
-------------- ------------
(a) Class A, Class B and Class D commenced operations March 3, 2003. On October
13, 2003, Class D was redesignated Class C.
See accompanying notes to financial statements.
77
COLUMBIA THERMOSTAT FUND
>FINANCIAL HIGHLIGHTS
(UNAUDITED) INCEPTION
SIX MONTHS MARCH 3, 2003
ENDED THROUGH
CLASS A SHARES JUNE 30, DECEMBER 31,
-------------- -------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004 2003
NET ASSET VALUE, BEGINNING OF PERIOD $ 12.30 $ 10.10
INCOME FROM INVESTMENT OPERATIONS
Net investment income (a) 0.12 0.18
Net realized and unrealized gain 0.21 2.15
-------------- -------------
Total from Investment Operations 0.33 2.33
-------------- -------------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income -- (0.13)
From net realized gains (0.02) (0.00)(b)
-------------- -------------
Total Distributions Declared to Shareholders (0.02) (0.13)
-------------- -------------
NET ASSET VALUE, END OF PERIOD $ 12.61 $ 12.30
============== =============
Total Return (c)(d)(e) 2.66% 23.10%
-------------- -------------
RATIOS TO AVERAGE NET ASSETS
Expenses (f)(g)(h) 0.50% 0.57%
Net investment income (g)(h) 1.95% 1.86%
Reimbursement (h) 0.31% 0.66%
Portfolio turnover rate 32%(e) 61%
Net assets at end of period (000's) $ 67,687 $ 42,271
(a) Per share data was calculated using average shares outstanding during the
period. Recognition of net investment income by the Fund is affected by the
timing of the declaration of dividends by the underlying investment
companies in which the Fund invests.
(b) Rounds to less than $0.01 per share.
(c) Total return at net asset value assuming all distributions reinvested and
no initial sales charge or contingent deferred sales charge.
(d) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(e) Not annualized.
(f) Does not include expenses of the investment companies in which the Fund
invests.
(g) The benefits derived from custody fees paid indirectly had no impact.
(h) Annualized.
(UNAUDITED) INCEPTION
SIX MONTHS MARCH 3, 2003
ENDED THROUGH
CLASS B SHARES JUNE 30, DECEMBER 31,
-------------- -------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004 2003
NET ASSET VALUE, BEGINNING OF PERIOD $ 12.32 $ 10.10
INCOME FROM INVESTMENT OPERATIONS
Net investment income (a) 0.07 0.10
Net realized and unrealized gain 0.21 2.16
-------------- -------------
Total from Investment Operations 0.28 2.26
-------------- -------------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income -- (0.04)
From net realized gains (0.02) (0.00)(b)
-------------- -------------
Total Distributions Declared to Shareholders (0.02) (0.04)
-------------- -------------
NET ASSET VALUE, END OF PERIOD $ 12.58 $ 12.32
============== =============
Total Return (c)(d)(e) 2.25% 22.38%
-------------- -------------
RATIOS TO AVERAGE NET ASSETS
Expenses (f)(g)(h) 1.25% 1.32%
Net investment income (g)(h) 1.20% 1.06%
Reimbursement (h) 0.27% 0.66%
Portfolio turnover rate 32%(e) 61%
Net assets at end of period (000's) $ 69,753 $ 51,501
(a) Per share data was calculated using average shares outstanding during the
period. Recognition of net investment income by the Fund is affected by the
timing of the declaration of dividends by the underlying investment
companies in which the Fund invests.
(b) Rounds to less than $0.01 per share.
(c) Total return at net asset value assuming all distributions reinvested and
no initial sales charge or contingent deferred sales charge.
(d) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(e) Not annualized.
(f) Does not include expenses of the investment companies in which the Fund
invests.
(g) The benefits derived from custody fees paid indirectly had no impact.
(h) Annualized.
(UNAUDITED) INCEPTION
SIX MONTHS MARCH 3, 2003
ENDED THROUGH
CLASS C SHARES JUNE 30, DECEMBER 31,
-------------- -------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004 2003
NET ASSET VALUE, BEGINNING OF PERIOD $ 12.32 $ 10.10
INCOME FROM INVESTMENT OPERATIONS
Net investment income (a) 0.07 0.11
Net realized and unrealized gain 0.21 2.15
-------------- -------------
Total from Investment Operations 0.28 2.26
-------------- -------------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income -- (0.04)
From net realized gains (0.02) (0.00)(b)
-------------- -------------
Total Distributions Declared to Shareholders (0.02) (0.04)
NET ASSET VALUE, END OF PERIOD $ 12.58 $ 12.32
============== =============
Total Return (c)(d)(e) 2.25% 22.38%
-------------- -------------
RATIOS TO AVERAGE NET ASSETS
Expenses (f)(g)(h) 1.25% 1.32%
Net investment income (g)(h) 1.20% 1.10%
Reimbursement (h) 0.24% 0.66%
Portfolio turnover rate 32%(e) 61%
Net assets at end of period (000's) $ 28,944 $ 20,087
(a) Per share data was calculated using average shares outstanding during the
period. Recognition of net investment income by the Fund is affected by the
timing of the declaration of dividends by the underlying investment
companies in which the Fund invests.
(b) Rounds to less than $0.01 per share.
(c) Total return at net asset value assuming all distributions reinvested and
no initial sales charge or contingent deferred sales charge.
(d) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(e) Not annualized.
(f) Does not include expenses of the investment companies in which the Fund
invests.
(g) The benefits derived from custody fees paid indirectly had no impact.
(h) Annualized.
See accompanying notes to financial statements.
78
1-800-922-6769
COLUMBIA THERMOSTAT FUND
>NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1. Nature of Operations
Columbia Thermostat Fund (the "Fund"), a series of Columbia Acorn Trust (the
"Trust"), an open-end management investment company organized as a Massachusetts
business trust, commenced operations September 25, 2002. The Fund may issue an
unlimited number of shares. The Fund currently offers four classes of shares:
Class A, Class B, Class C and Class Z. On October 13, 2003, Class D was
redesignated Class C.
Class A shares are sold with a front-end sales charge. A contingent
deferred sales charge ("CDSC") may be assessed to Class A shares purchased
without an initial sales charge on redemptions made within eighteen months on an
original purchase of $1 million to $25 million.
Class B shares are subject to a CDSC. Class B shares will convert to Class
A shares in three, four or eight years after purchase, depending on the program
under which shares are purchased.
Class C shares are subject to a CDSC on redemptions made within one year
after purchase.
Class Z shares are offered continuously at net asset value. There are
certain restrictions on the purchase of Class Z shares.
The financial highlights for Class Z shares are presented in a separate
semi-annual report. The semi-annual report for the other series of the Trust is
also included in this report.
The investment objective of the Fund is to provide long-term total return.
The Fund pursues its investment objective by investing in shares of other mutual
funds. As a `fund of funds', under normal circumstances, the Fund allocates at
least 95% of its net assets among a selected group of stock and bond mutual
funds (the "Portfolio Funds") according to the current level of the Standard &
Poor's 500 Stock Index in relation to predetermined ranges set by the Fund's
investment adviser. As of June 30, 2004, the Fund invested in five stock
Portfolio Funds (Columbia Acorn Fund, Columbia Acorn Select Fund, Columbia
Growth & Income Fund, Columbia Mid-Cap Value Fund and Columbia Growth Stock
Fund) and three bond Portfolio Funds (Columbia Federal Securities Fund, Columbia
Intermediate Bond Fund and Columbia High-Yield Fund). The Fund may also invest
up to 5% of its net assets plus any cash received that day in cash, repurchase
agreements, high quality short-term paper and government securities.
2. Significant Accounting Policies
>Security valuation
Investments in Portfolio Funds are valued at their net asset value as reported
by the underlying funds. High quality short-term paper and government securities
having a maturity of 60 days or less from the valuation date are valued on an
amortized cost basis, which approximates fair value.
>Repurchase agreements
The Fund may engage in repurchase agreement transactions. The Fund, through its
custodian, receives delivery of underlying securities collateralizing each
repurchase agreement. The Fund's investment advisor determines that the value of
the underlying securities is at all times at least equal to the resale price. In
the event of default or bankruptcy by the other party to the agreement,
realization and/or retention of the collateral may be subject to legal
proceedings.
>Security transactions and investment income
Portfolio Fund transactions are accounted for on the trade date (date the order
to buy or sell is executed). Dividend income and realized gain distributions
from other funds are recorded on the ex-dividend date. Interest income is
recorded on the accrual basis and includes amortization of discounts on
short-term debt obligations when required for federal income tax purposes.
Realized gains and losses from security transactions are reported on an
identified cost basis. Awards from class action litigation may be recorded as a
reduction of cost by Portfolio Funds. If the Portfolio Fund no longer owns the
applicable securities, the proceeds are recorded as realized gains.
>Use of estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and accompanying notes.
Actual results may differ from those estimates.
>Fund share valuation
Fund shares are sold and redeemed on a continuing basis at net asset value. Net
asset value per share is determined daily as of the close of trading on the New
York Stock Exchange on each day the Exchange is open for trading. All income,
expenses (other than Class A, Class B and Class C 12b-1 service and distribution
fees, and Class A, Class B, Class C and Class Z Transfer Agent fees) and
realized and
79
COLUMBIA THERMOSTAT FUND
>NOTES TO FINANCIAL STATEMENTS (UNAUDITED), CONTINUED
unrealized gains (losses) of the Fund are allocated to each class
proportionately on a daily basis for purposes of determining the net asset value
of each class.
>Custody fees
The custody fees are reduced based on the Fund's cash balance maintained with
the custodian. The amount is disclosed as a reduction of total expenses in the
Statement of Operations.
>Federal income taxes
The Fund has complied with the special provisions of the Internal Revenue Code
available to regulated investment companies and, in the manner provided therein,
distributes all of its taxable income, as well as any net realized gain on sales
of Portfolio Fund shares and any distributions of net realized gains received by
the Fund from its Portfolio Funds, reportable for federal income tax purposes.
Accordingly, the Fund paid no federal income taxes and no federal income tax
provision was required.
>Distributions to Shareholders
Distributions to shareholders are recorded on the ex-date.
3. FEDERAL TAX INFORMATION
The tax character of distributions paid during the year ended December 31, 2003
was as follows:
ORDINARY LONG-TERM
INCOME CAPITAL GAINS
- --------------------------------------------------------------------------------
(IN THOUSANDS)
$ 771 $ 10
4. TRANSACTIONS WITH AFFILIATES
Columbia Wanger Asset Management, L.P. ("Columbia WAM"), an indirect
wholly-owned subsidiary of Columbia Management Group, Inc., which in turn is a
wholly-owned subsidiary of Bank of America Corporation ("BOA") furnishes
continuing investment supervision to the Fund and is responsible for the overall
management of the Fund's business affairs. Prior to April 1, 2004, Columbia
Management Group, Inc. was a wholly-owned subsidiary of Fleet National Bank,
which in turn was a wholly-owned subsidiary of FleetBoston Financial Corporation
("Fleet"). On April 1, 2004, Fleet was acquired by BOA.
Under the Fund's investment management agreement, fees are accrued daily
and paid monthly to Columbia WAM at the annual rate of 0.10% of the Fund's
average daily net assets.
>Expense Limit
Columbia WAM has agreed to voluntarily reimburse the direct operating expenses
(exclusive of 12b-1 service and distribution fees, interest and fees on
borrowings and expenses associated with the Fund's investment in other
investment companies) exceeding 0.60% of the average annual net assets of the
Fund's Class A, Class B and Class C shares. Effective August 1, 2003, Columbia
WAM agreed to contractually reimburse the direct operating expenses (exclusive
of 12b-1 service and distribution fees, interest and fees on borrowings and
expenses associated with the Fund's investment in other investment companies)
exceeding 0.25% of the average annual net assets of the Fund's Class A, Class B
and Class C shares.
Columbia WAM also provides administrative services to the Fund at an annual
rate of 0.05% of average daily net assets.
Effective August 1, 2004 Columbia WAM will receive an administration fee
from the Fund, based on the average daily net assets of the Trust, at the
following annual rates:
COLUMBIA ACORN TRUST
- --------------------------------------------------------------------------------
Average daily net asset value:
On the first $8 billion 0.05%
Next $8 billion 0.04%
Average daily net assets in excess of $16 billion 0.03%
Columbia Funds Distributor, Inc. ("CFDI"), an indirect wholly-owned
subsidiary of BOA, is the Fund's principal underwriter and receives no
compensation on the sale of Class Z shares.
For the six months ended June 30, 2004, the Fund has been advised that CFDI
retained $108,017 in underwriting discounts on the sale of Class A shares and
received CDSCs of $34, $71,173 and $6,621 on Class A, Class B and Class C share
redemptions, respectively.
The Fund has adopted a 12b-1 plan which requires it to pay CFDI a monthly
service fee equal to 0.25% annually, of the average daily net assets
attributable to Class A, Class B and Class C shares. The 12b-1 plan also
requires the Fund to pay CFDI a monthly distribution fee equal to 0.10%, 0.75%,
0.75%, annually, of the average daily net asset attributable to Class A, Class B
and Class C shares, respectively. For Class A shares the Fund may pay
distribution and service fees up to a maximum of 0.35% annually of the Fund's
average daily net assets (comprised of up to 0.10% for distribution services and
up to 0.25% for shareholder liaison services)
80
1-800-922-6769
but will limit such fees to an aggregate of not more than 0.25% during the
current fiscal year. Effective August 1, 2004, the Fund's Class A share 12b-1
fee was reduced to 25 basis points, resulting in the elimination of the 10 basis
point distribution fee on Class A shares. In addition, the Fund's 12b-1 fee for
Class B shares was reduced from 100 basis points to 85 basis points, decreasing
the distribution portion of the 12b-1 fee to 60 basis points.
Columbia Funds Services, Inc. (the "Transfer Agent"), an indirect,
wholly-owned subsidiary of BOA, provides shareholder services to the Fund. For
such services, the Transfer Agent receives a fee, paid monthly, at the annual
rate of $28.00 per open account. The Transfer Agent also receives reimbursement
for certain out-of-pocket expenses. Effective February 1, 2004 the Transfer
Agent made the decision to waive the reimbursement for certain out-of-pocket
expenses. Prior to February 1, 2004, the Transfer Agent was entitled to receive
a monthly transfer agent fee at the annual rate of 0.07% of the average daily
net assets attributable to Class A, Class B and Class C shares plus flat-rate
charges based on the number of shareholder accounts and transactions.
Certain officers and trustees of the Trust are also officers of Columbia
WAM. The Trust makes no direct payments to its officers and trustees who are
affiliated with Columbia WAM. Trustees' fees and expenses paid by the Fund for
the six months ended June 30, 2004, including the Fund's portion of a special
payment to the chairman of the board of $25,000 for extraordinary time and
effort spent on board matters during 2003, were $1,240.
5. BORROWING ARRANGEMENTS
The Trust participates in a $150,000,000 credit facility, which was entered into
to facilitate portfolio liquidity. No amounts have been borrowed under this
facility for the six months ended June 30, 2004.
6. INVESTMENT TRANSACTIONS
The aggregate cost of purchases and proceeds from sales other than short-term
obligations for the six months ended June 30, 2004 were:
(IN THOUSANDS)
- --------------------------------------------------------------------------------
Purchases $ 103,922
Proceeds from sales $ 50,510
================================================================================
7. LEGAL PROCEEDINGS
The Securities and Exchange Commission (the "SEC"), the New York Attorney
General (the "NYAG") and various other regulatory authorities are investigating
late trading and market timing in mutual fund shares, and have sent information
requests and subpoenas to certain affiliates of Columbia Management Group, Inc.
("CMG") (collectively, "Columbia"). These affiliates include CFDI, Columbia
Management Advisors, Inc. ("CMA"), and Columbia WAM. CMA is the adviser to the
Columbia Family of Funds, but is not the adviser to the Columbia Acorn Family of
Funds. Columbia has not uncovered any instances where any of its affiliates were
knowingly involved in late trading of mutual fund shares.
On February 24, 2004, the SEC filed a civil complaint in the United States
District Court for the District of Massachusetts against CFDI and CMA, alleging
that they had violated certain provisions of the federal securities laws in
connection with trading activity in mutual fund shares. Also on February 24,
2004, the NYAG filed a civil complaint in New York Supreme Court, County of New
York against CFDI and CMA alleging that CFDI and CMA had violated certain New
York anti-fraud statutes. Both complaints are based on arrangements between 1998
and 2003 with nine investors for the trading of mutual fund shares. Neither
complaint was filed against Columbia WAM nor the Columbia Acorn Family of Funds.
However, the complaints against CFDI and CMA identified Columbia Acorn Fund,
Columbia Acorn International and Columbia Acorn International Select as funds in
which one or more of the nine investors invested. If either CFDI or CMA were
unsuccessful in its defense of those proceedings, it could be barred from
serving as a distributor or investment adviser for any investment company
registered under the Investment Company Act of 1940, as amended (a "registered
investment company"), which could prevent CFDI from serving as the Fund's
distributor and could affect the ability of an affiliated person of CFDI or CMA
to serve as a distributor or investment adviser for any registered investment
company. The Funds have been informed by CFDI that, in such a situation, it will
seek exemptive relief from the SEC to permit it to continue to serve as the
Fund's
81
COLUMBIA THERMOSTAT FUND
>NOTES TO FINANCIAL STATEMENTS (UNAUDITED), CONTINUED
distributor. There is no assurance that such exemptive relief would be granted.
On March 15, 2004, CFDI and CMA entered into agreements in principle with
the SEC Division of Enforcement and NYAG in settlement of the charges. Under the
agreements, CFDI and CMA agreed, among other things, to the following
conditions: payment of $70 million in disgorgement; payment of $70 million in
civil penalties; an order requiring CFDI and CMA to cease and desist from
violations of the antifraud provisions and other provisions of the federal
securities laws; governance changes designed to maintain the independence of the
mutual fund boards of trustees and ensure compliance with securities laws and
fiduciary duties; and retention of an independent consultant to review CFDI's
and CMA's compliance policies and procedures. The agreement requires the final
approval of the SEC. In a separate agreement with the NYAG, Columbia has agreed
to reduce mutual fund fees by $80 million over a five-year period.
The Trust and Columbia WAM are defendants in several derivative and class
action lawsuits that allege, in summary, defendants permitted investors to
engage in improper trading of shares of various funds in violation of certain
federal and state laws. The Trust and Columbia WAM are also defendants in a
class action lawsuit that alleges, in summary, that the Trust and Columbia WAM
exposed shareholders of Columbia Acorn International Fund to trading by market
timers by allegedly (a) failing to properly evaluate daily whether a significant
event affecting the value of that Fund's securities had occurred after foreign
markets had closed but before the calculation of the Fund's net asset value
("NAV"); (b) failing to implement the Fund's portfolio valuation and share
pricing policies and procedures; and (c) failing to know and implement
applicable rules and regulations concerning the calculation of NAV (the "Fair
Valuation Lawsuit"). All of these lawsuits have been transferred to a federal
court in Maryland, where they will be consolidated with similar suits in a
Multi-District Litigation proceeding.
The Trust and Columbia WAM are defendants in a class action lawsuit in
Illinois state court similar to the Fair Valuation Lawsuit. Lastly, Columbia WAM
is also defendant in a lawsuit alleging that Columbia WAM used Fund assets to
make undisclosed payments to brokers as an incentive for the brokers to market
the Funds over other mutual funds to investors. The complaint alleges Columbia
WAM breached certain common law duties and federal laws.
The Trust and Columbia WAM intend to defend these suits vigorously. The
Trust does not believe that the pending actions will have a material adverse
effect on the financial statements of any Fund, and Columbia WAM does not
believe that the pending actions will have a material adverse effect on its
ability to perform under its contracts with the Funds.
As a result of these matters or any adverse publicity or other developments
resulting from them, there may be increased redemptions or reduced sales of Fund
shares, which could increase transaction costs or operating expenses, or have
other adverse consequences for the Fund.
In connection with the events described in detail above, various parties
have filed suit against certain funds, their Boards and/or Fleet (and affiliated
entities). These suits and certain regulatory investigations are ongoing.
Accordingly, an estimate of the financial impact of this litigation on any fund,
if any, cannot currently be made.
For the six months ended June 30, 2004, CMG has assumed $1,830 consulting
services and fees incurred by the Fund in connection with these matters.
82
1-800-922-6769
CHANGE IN INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
Effective April 13, 2004, the audit committee of the Trust requested that Ernst
& Young LLP ("E&Y") resign as the auditors of the Funds. Also effective July 14,
2004, upon the recommendation of the audit committee, the Trust selected
PricewaterhouseCoopers LLP ("PWC") as independent registered public accounting
firm to audit the books and records of each Fund for its fiscal year ending
December 31, 2004. The cessation of the relationship with E&Y was based on the
impairment of E&Y's independence resulting from the consummation of the merger
of FleetBoston Financial Corporation and Bank of America Corporation and
accordingly, E&Y's ability to provide audit services to the Funds.
E&Y's report on the financial statements of each Fund for the past two
years did not contain an adverse opinion or disclaimer of opinion, and was not
qualified or modified as to uncertainty, audit scope or accounting principles.
During the period E&Y was engaged, there were no disagreements with E&Y on any
matter of accounting principles or practices, financial statement disclosure, or
auditing scope or procedure which, if not resolved to E&Y's satisfaction, would
have caused it to make reference to that matter in connection with its report.
83
COLUMBIA ACORN FAMILY OF FUNDS CLASS A, B AND C SHARE INFORMATION
MINIMUM INITIAL INVESTMENT IN
COLUMBIA ACORN INTERNATIONAL,
COLUMBIA ACORN INTERNATIONAL
SELECT, COLUMBIA ACORN SELECT,
COLUMBIA THERMOSTAT FUND $ 1,000
$ 1,000 FOR AN IRA
MINIMUM INITIAL INVESTMENT
IN COLUMBIA ACORN FUND
AND COLUMBIA ACORN USA $ 50,000
MINIMUM SUBSEQUENT
INVESTMENT $ 50
EXCHANGE FEE NONE
COLUMBIA ACORN FUND CLASS A CLASS B CLASS C
Management Fees 0.66% 0.66% 0.66%
Distribution and Service (12b-1) Fees 0.35% 1.00% 1.00%
Other Expenses 0.24% 0.33% 0.30%
------- ------- -------
Expense Ratio 1.25% 1.99% 1.96%
COLUMBIA ACORN INTERNATIONAL CLASS A CLASS B CLASS C
Management Fees 0.82% 0.82% 0.82%
Distribution and Service (12b-1) Fees 0.35% 1.00% 1.00%
Other Expenses 0.33% 0.50% 0.38%
------- ------- -------
Expense Ratio 1.50% 2.32% 2.20%
COLUMBIA ACORN USA CLASS A CLASS B CLASS C
Management Fees 0.91% 0.91% 0.91%
Distribution and Service (12b-1) Fees 0.35% 1.00% 1.00%
Other Expenses 0.27% 0.36% 0.30%
------- ------- -------
Expense Ratio 1.53% 2.27% 2.21%
COLUMBIA ACORN INTERNATIONAL SELECT CLASS A CLASS B CLASS C
Management Fees 0.95% 0.95% 0.95%
Distribution and Service (12b-1) Fees 0.35% 1.00% 1.00%
Other Expenses 0.50% 0.50% 0.50%
------- ------- -------
Expense Ratio 1.80% 2.45% 2.45%
COLUMBIA ACORN SELECT CLASS A CLASS B CLASS C
Management Fees 0.90% 0.90% 0.90%
Distribution and Service (12b-1) Fees 0.35% 1.00% 1.00%
Other Expenses 0.27% 0.40% 0.35%
------- ------- -------
Expense Ratio 1.52% 2.30% 2.25%
COLUMBIA THERMOSTAT* CLASS A CLASS B CLASS C
Management Fees 0.10% 0.10% 0.10%
Distribution and Service (12b-1) Fees 0.25% 1.00% 1.00%
Other Expenses 0.15% 0.15% 0.15%
------- ------- -------
Expense Ratio 0.50% 1.25% 1.25%
Fees and expenses are for the six months ended June 30, 2004 and for Columbia
Acorn International Select and Columbia Thermostat Fund include the effect of
Columbia Wanger Asset Management's undertaking to reimburse those funds for any
ordinary operating expenses, exclusive of 12b-1 service and distribution fees,
interest, taxes and extraordinary expenses, if any, exceeding 1.45% and 0.25% of
their average net assets, respectively. The expense limitation for Columbia
Acorn International Select is voluntary and can be terminated by either the Fund
or Columbia Wanger Asset Management, L.P. on 30 days' notice. Columbia
Thermostat Fund's reimbursement arrangement is contractual through April 30,
2005. The Fund's adviser and/or affiliates have contractually agreed to waive a
portion of "other expenses" through April 30, 2005. Effective August 1, 2004,
each Fund's Class A share 12b-1 fee was reduced to 25 basis points, resulting in
the elimination of the 10 basis point distribution fee on Class A shares. In
addition, each Fund's 12b-1 fee for Class B shares was reduced from 100 basis
points to 85 basis points, decreasing the distribution portion of the 12b-1 fee
to 60 basis points.
* Expenses for Columbia Thermostat do not include estimated fees and expenses of
0.94% incurred by the Fund from the underlying portfolio funds.
84
1-800-922-6769
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COLUMBIA ACORN
- --------------------------------------------------------------------------------
FAMILY OF FUNDS
TRUSTEES
Robert E. Nason
CHAIRMAN
Margaret Eisen
Leo A. Guthart
Jerome Kahn, Jr.
Steven N. Kaplan
David C. Kleinman
Charles P. McQuaid
Allan B. Muchin
Ralph Wanger
John A. Wing
OFFICERS
Charles P. McQuaid
PRESIDENT
Ben Andrews
VICE PRESIDENT
Michael G. Clarke
ASSISTANT TREASURER
J. Kevin Connaughton
ASSISTANT TREASURER
P. Zachary Egan
VICE PRESIDENT
Kenneth A. Kalina
ASSISTANT TREASURER
Bruce H. Lauer
VICE PRESIDENT, SECRETARY AND TREASURER
Louis J. Mendes
VICE PRESIDENT
Robert A. Mohn
VICE PRESIDENT
Todd M. Narter
VICE PRESIDENT
Christopher J. Olson
VICE PRESIDENT
Vincent P. Pietropaolo
ASSISTANT SECRETARY
Robert P. Scales
CHIEF COMPLIANCE OFFICER, VICE PRESIDENT
GENERAL COUNSEL AND CHIEF LEGAL OFFICER
INVESTMENT ADVISER
Columbia Wanger Asset Management, L.P.
227 West Monroe Street, Suite 3000
Chicago, Illinois 60606
1-800-922-6769
DISTRIBUTOR
Columbia Funds Distributor, Inc.
One Financial Center
Boston, Massachusetts 02111-2621
TRANSFER AGENT, DIVIDEND DISBURSING AGENT
Columbia Funds Services, Inc.
P.O. Box 8081
Boston, Massachusetts 02266-8081
1-800-345-6611
LEGAL COUNSEL
Bell, Boyd & Lloyd LLC
Chicago, Illinois
THIS REPORT, INCLUDING THE SCHEDULES OF INVESTMENTS, IS SUBMITTED FOR THE
GENERAL INFORMATION OF THE SHAREHOLDERS OF COLUMBIA ACORN TRUST. THIS REPORT IS
NOT AUTHORIZED FOR DISTRIBUTION UNLESS PRECEDED OR ACCOMPANIED BY A PROSPECTUS.
AN INVESTOR SHOULD CAREFULLY CONSIDER CHARGES AND EXPENSES BEFORE INVESTING. TO
OBTAIN A PROSPECTUS CONTAINING THIS AND OTHER INFORMATION, PLEASE CALL (800)
922-6769 OR VISIT OUR WEBSITE (SHOWN BELOW). PLEASE READ THE PROSPECTUS
CAREFULLY BEFORE YOU INVEST OR SEND MONEY.
A DESCRIPTION OF THE POLICIES AND PROCEDURES THAT THE FUNDS USE TO DETERMINE HOW
TO VOTE PROXIES RELATING TO THEIR PORTFOLIO SECURITIES IS AVAILABLE (I) WITHOUT
CHARGE, UPON REQUEST, BY CALLING 800-922-6769 AND (II) ON THE SECURITIES AND
EXCHANGE COMMISSION'S WEBSITE AT HTTP://WWW.SEC.GOV.
Find out what's new - visit our web site at:
www.columbiafunds.com
OUR E-MAIL ADDRESS IS:
serviceinquiries@columbiamanagement.com
SHAREHOLDERS SHOULD NOT INCLUDE PERSONAL INFORMATION SUCH AS ACCOUNT
NUMBERS, SOCIAL SECURITY NUMBERS OR TAXPAYER IDENTIFICATION NUMBERS IN
E-MAIL. WE ARE UNABLE TO ACCEPT ACCOUNT TRANSACTIONS SENT VIA E-MAIL.
88
1-800-922-6769
DIRECTIONS TO THE 2004 COLUMBIA ACORN FUNDS SHAREHOLDER INFORMATION MEETING
FROM THE SOUTH:
Take 1-57 (which merges with I-94, also known as the Dan Ryan Expressway). Take
the Dan Ryan into Chicago. Follow the signs for the Kennedy (I-90/94) Expressway
West. Travel on the Kennedy and exit using the Monroe Street exit. Turn right
(east) from the exit onto Monroe Street. Proceed east to LaSalle Street and turn
right (south).
FROM THE NORTH:
Take the Kennedy Expressway (I-90/94) south to Chicago. Exit at Jackson
Boulevard. Turn left (east) from the exit onto Jackson Boulevard. Proceed east
on Jackson to LaSalle Street.
FROM THE WEST:
Take the Eisenhower Expressway (I-290) from the west. This becomes Congress
Parkway in the city. Bear right (south) off of Congress onto Franklin Street.
Turn right (east) on Jackson Boulevard. Proceed east on Jackson to LaSalle
Street.
FROM THE SOUTHWEST:
Take the Stevenson Expressway (I-55). Exit to the Kennedy Expressway
(North-Wisconsin). Travel on the Kennedy and exit using the Monroe Street exit.
Turn right (east) from the exit onto Monroe Street. Proceed east to LaSalle
Street and turn right (south).
PARKING INFORMATION
There is no parking in the Bank of America Building but several public parking
lots are located within two blocks of the building. The South Loop Self Park is
located at 318 S. Federal Street. Traders Self Park is located at 326 S. Wells
Street. Both lots are marked on the map on the inside front cover of this
report.
For directions using public transportation, call (312) 836-7000 for CTA travel
information or visit the CTA website at www.transitchicago.com. For Metra
information call (312) 322-6777 during business hours or find information at
www.metrarail.com.
COLUMBIA ACORN FUNDS SEMIANNUAL REPORT, JUNE 30, 2004
[U.S. Postage Stamp]
[EAGLE HEAD LOGO] COLUMBIA FUNDS
A MEMBER OF COLUMBIA MANAGEMENT GROUP
(C)2004 COLUMBIA FUNDS DISTRIBUTOR, INC.
ONE FINANCIAL CENTER, BOSTON, MA 02111-2621
800.345.6611 WWW.COLUMBIAFUNDS.COM
ACN-03/220S-06/04 (08/04) 04/1956
LOOK INSIDE FOR THE DATE
AND NEW LOCATION
OF THE 2004 COLUMBIA
ACORN FUNDS SHAREHOLDER
INFORMATION MEETING.
COLUMBIA ACORN FAMILY OF FUNDS
CLASS Z SHARES
SEMIANNUAL REPORT
JUNE 30, 2004
MANAGED BY COLUMBIA WANGER ASSET MANAGEMENT, L.P. 2
COLUMBIA ACORN FUND
COLUMBIA ACORN INTERNATIONAL
COLUMBIA ACORN USA
COLUMBIA ACORN INTERNATIONAL SELECT
COLUMBIA ACORN SELECT
COLUMBIA THERMOSTAT FUND
PLEASE JOIN US FOR THE 2004 COLUMBIA ACORN FUNDS SHAREHOLDER INFORMATION MEETING
WHEN
September 28, 2004
9:00 a.m. CST
NEW MEETING LOCATION
Bank of America
LaSalle Room, 21st Floor
231 S. LaSalle Street
Chicago, IL 60604
REFRESHMENTS WILL BE SERVED.
The Bank of America Building is bordered by LaSalle Street on the west, Clark
Street on the east and Jackson Boulevard on the South. The building is easily
accessible by public transportation and is near Chicago Metra stations. See the
map below for the exact location.
RSVP BY SEPTEMBER 21
PLEASE CALL US AT (800) 922-6769 BY SEPTEMBER 21 IF YOU PLAN TO ATTEND. To
comply with security requirements, we must provide Bank of America building
management with a list of guests attending the meeting. Calling to RSVP should
prevent security delays at the door on the day of the event.
TO ACCESS THE 21ST FLOOR MEETING ROOM, YOU MAY CHECK IN AT THE SECURITY DESK
LOCATED ON THE LASALLE STREET SIDE OF THE BUILDING LOBBY. YOU WILL NEED TO
PRESENT A VALID PICTURE ID (SUCH AS A DRIVER'S LICENSE) TO BUILDING SECURITY FOR
ADMITTANCE TO THE MEETING FLOOR.
We hope you will join us to meet your Columbia Acorn Funds' portfolio managers,
analysts and your fellow shareholders. Presentations will offer market updates
and provide in-depth information on your Columbia Acorn investments. A question
and answer period will follow the presentations.
[IMAGE OF LOCATION MAP]
FOR DIRECTIONS AND PARKING INFORMATION, PLEASE SEE THE INSIDE BACK COVER OF THIS
REPORT.
COLUMBIA ACORN FAMILY OF FUNDS SEMIANNUAL REPORT 2004
TABLE OF CONTENTS
Columbia Acorn Family of Funds
Performance At A Glance 2
Squirrel Chatter: Why The Heck Should We
Own Small-cap Stocks? 3
COLUMBIA ACORN FUND
In a Nutshell 6
At a Glance 7
Major Portfolio Changes 18
Statement of Investments 21
COLUMBIA ACORN INTERNATIONAL
In a Nutshell 8
At a Glance 9
Major Portfolio Changes 33
Statement of Investments 35
Portfolio Diversification 39
COLUMBIA ACORN USA
In a Nutshell 10
At a Glance 11
Major Portfolio Changes 40
Statement of Investments 41
COLUMBIA ACORN INTERNATIONAL SELECT
In a Nutshell 12
At a Glance 13
Major Portfolio Changes 46
Statement of Investments 47
Portfolio Diversification 49
COLUMBIA ACORN SELECT
In a Nutshell 14
At a Glance 15
Major Portfolio Changes 50
Statement of Investments 51
COLUMBIA THERMOSTAT FUND
In a Nutshell 16
At a Glance 17
Statement of Investments 70
Statement of Assets and Liabilities 71
Statement of Operations 72
Statement of Changes in Net Assets 73
Financial Highlights 75
Notes to Financial Statements 76
COLUMBIA ACORN FAMILY OF FUNDS
Statements of Assets and Liabilities 54
Statements of Operations 55
Statements of Changes in Net Assets 56
Financial Highlights 60
Notes to Financial Statements 64
Change in Independent Registered
Public Accounting Firm 80
Columbia Acorn Family of Funds Information 81
Board of Trustees and
Management of Acorn 84
> MID-YEAR DISTRIBUTIONS
The following table details the funds' mid-year distributions. The record date
was June 2, 2004, and the payable date was June 3, 2004. Columbia Acorn USA and
Columbia Acorn Select did not have any mid-year distributions.
COLUMBIA ACORN
COLUMBIA ACORN COLUMBIA ACORN INTERNATIONAL COLUMBIA
FUND INTERNATIONAL SELECT THERMOSTAT FUND
-------------- -------------- -------------- ---------------
Long-term Capital Gains $0.0283 None None $0.0028
Short-term Capital Gains None None None $0.0145
Income Dividend None $0.2498 $0.0678 None
Reinvestment Price $23.87 $23.50 $15.21 $12.45
THE DISCUSSION IN THIS REPORT OF PORTFOLIO COMPANIES IS FOR ILLUSTRATION ONLY
AND IS NOT A RECOMMENDATION OF INDIVIDUAL STOCKS. THE INFORMATION IS BELIEVED TO
BE ACCURATE, BUT THE INFORMATION AND THE VIEWS OF THE PORTFOLIO MANAGERS MAY
CHANGE AT ANY TIME WITHOUT NOTICE AND THE PORTFOLIO MANAGERS MAY ALTER A FUND'S
PORTFOLIO HOLDINGS BASED ON THESE VIEWS AND THE FUND'S CIRCUMSTANCES AT THAT
TIME.
1
COLUMBIA ACORN FAMILY OF FUNDS
>PERFORMANCE AT A GLANCE CLASS Z AVERAGE ANNUAL TOTAL RETURNS
THROUGH 6/30/04
2ND* YEAR TO* 1 3 5 10 LIFE
QUARTER DATE YEAR YEARS YEARS YEARS OF FUND
- -----------------------------------------------------------------------------------------------------------------
COLUMBIA ACORN
FUND (6/10/70) 1.65% 8.99% 35.90% 10.23% 13.94% 15.65% 16.34%
- -----------------------------------------------------------------------------------------------------------------
S&P 500 1.72% 3.44% 19.11% -0.69% -2.20% 11.83% 12.05%
- -----------------------------------------------------------------------------------------------------------------
Russell 2500 0.34% 6.24% 32.21% 7.40% 8.47% 13.08% NA
- -----------------------------------------------------------------------------------------------------------------
Russell 2000 0.47% 6.76% 33.37% 6.24% 6.63% 10.93% NA
- -----------------------------------------------------------------------------------------------------------------
Lipper Small-Cap
Core Funds Index 1.56% 7.76% 32.80% 7.22% 9.85% 12.48% NA
- -----------------------------------------------------------------------------------------------------------------
Lipper Mid-Cap
Core Funds Index 1.05% 5.51% 26.28% 4.34% 7.50% 12.47% NA
- -----------------------------------------------------------------------------------------------------------------
COLUMBIA ACORN
INTERNATIONAL (9/23/92) 1.77% 8.78% 41.42% 7.33% 5.48% 8.62% 11.38%
- -----------------------------------------------------------------------------------------------------------------
Citigroup EMI
Global ex-US -0.24% 9.52% 44.13% 13.29% 6.22% 4.42% 6.83%
- -----------------------------------------------------------------------------------------------------------------
MSCI EAFE 0.22% 4.56% 32.37% 3.87% 0.02% 4.06% 6.29%
- -----------------------------------------------------------------------------------------------------------------
Lipper Int'l Small-
Cap Funds Index 1.27% 11.16% 45.62% 12.44% 9.03% NA NA
- -----------------------------------------------------------------------------------------------------------------
COLUMBIA ACORN USA
(9/4/96) 4.67% 9.85% 34.66% 7.62% 10.20% -- 14.42%
- -----------------------------------------------------------------------------------------------------------------
Russell 2000 0.47% 6.76% 33.37% 6.24% 6.63% -- 8.97%
- -----------------------------------------------------------------------------------------------------------------
Lipper Small-Cap
Core Funds Index 1.56% 7.76% 32.80% 7.22% 9.85% -- 10.29%
- -----------------------------------------------------------------------------------------------------------------
S&P 500 1.72% 3.44% 19.11% -0.69% -2.20% -- 8.99%
- -----------------------------------------------------------------------------------------------------------------
COLUMBIA ACORN INT'L
SELECT (11/23/98) 0.70% 7.68% 38.45% 5.06% 4.01% -- 8.70%
- -----------------------------------------------------------------------------------------------------------------
Citigroup World ex-US
Cap Range $2-10B -1.23% 7.29% 42.32% 10.36% 6.19% -- 7.23%
- -----------------------------------------------------------------------------------------------------------------
MSCI EAFE 0.22% 4.56% 32.37% 3.87% 0.02% -- 1.49%
- -----------------------------------------------------------------------------------------------------------------
Lipper International
Funds Index -1.08% 3.86% 29.36% 3.93% 1.54% -- 2.98%
- -----------------------------------------------------------------------------------------------------------------
COLUMBIA ACORN
SELECT (11/23/98) 1.93% 7.42% 20.40% 10.47% 10.62% -- 14.74%
- -----------------------------------------------------------------------------------------------------------------
S&P MidCap 400 0.97% 6.08% 27.98% 6.58% 9.05% -- 11.40%
- -----------------------------------------------------------------------------------------------------------------
Lipper Mid-Cap
Growth Index 1.32% 5.28% 23.14% -2.76% 0.19% -- 5.31%
- -----------------------------------------------------------------------------------------------------------------
S&P 500 1.72% 3.44% 19.11% -0.69% -2.20% -- 1.11%
- -----------------------------------------------------------------------------------------------------------------
COLUMBIA THERMOSTAT
FUND (9/25/02) -0.18% 2.74% 12.91% -- -- -- 15.08%
- -----------------------------------------------------------------------------------------------------------------
S&P 500 1.72% 3.44% 19.11% -- -- -- 22.82%
- -----------------------------------------------------------------------------------------------------------------
Lehman U.S Credit
Intermediate Bond Index -2.82% -0.08% 0.44% -- -- -- 5.61%
- -----------------------------------------------------------------------------------------------------------------
Lehman U.S. Govt.
Intermediate Bond Index -2.30% -0.15% -0.48% -- -- -- 1.99%
- -----------------------------------------------------------------------------------------------------------------
Lipper Flexible
Portfolio Funds Index -0.11% 2.25% 14.64% -- -- -- 17.58%
- -----------------------------------------------------------------------------------------------------------------
*Not annualized.
PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND
PRINCIPAL VALUE OF AN INVESTMENT IN A FUND WILL FLUCTUATE SO THAT FUND SHARES,
WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. PERFORMANCE
CHANGES OVER TIME. VISIT COLUMBIAFUNDS.COM FOR DAILY UPDATES.
DESCRIPTION OF INDEXES: S&P 500 is a broad, market-weighted average of U.S.
blue-chip company stock performance. S&P MIDCAP 400 is a broad market-weighted
index of 400 stocks that are in the next size/tier down from the S&P 500.
RUSSELL 2000 is a market-weighted index of 2000 smaller U.S. companies, formed
by taking the largest 3,000 companies and eliminating the largest 1,000. RUSSELL
2500 is the smallest 2,500 U.S. companies from this same group. CITIGROUP EMI
GLOBAL EX-US is the bottom 20% of institutionally investable capital of
developed and emerging countries, selected by index sponsor, outside the U.S.
MSCI EAFE is Morgan Stanley's Europe, Australasia and Far East Index, a widely
recognized international benchmark that comprises 20 major markets in proportion
to world stock market capitalization. CITIGROUP WORLD EX-US CAP RANGE $2-$10B is
a subset of the Broad Market Index, representing a mid-cap developed market
index excluding the U.S. LIPPER INDEXES include the largest funds tracked by
Lipper, Inc. in the named category. LIPPER MID-CAP GROWTH INDEX, 30 mid-cap
growth funds; LIPPER MID-CAP CORE FUNDS INDEX, 30 mid-cap core funds; LIPPER
INTERNATIONAL FUNDS INDEX, 30 largest non-U.S. funds, not including non-U.S.
small-cap funds; LIPPER INTERNATIONAL SMALL-CAP FUNDS INDEX, 10 largest non-U.S.
funds investing in small-cap companies, including Columbia Acorn International;
LIPPER SMALL-CAP CORE FUNDS INDEX, 30 largest small-cap core funds, including
Columbia Acorn Fund. LIPPER FLEXIBLE PORTFOLIO FUNDS INDEX is an equal dollar
weighted index of the 30 largest mutual funds within the Flexible Portfolio fund
classification, as defined by Lipper. LEHMAN U.S. GOVERNMENT INTERMEDIATE BOND
INDEX is made up of 1 to 10 year treasury and agency bonds, excluding targeted
investor notes and state and local government series bonds. The LEHMAN U.S.
CREDIT INTERMEDIATE BOND INDEX is the intermediate component of the U.S. Credit
Index. The U.S. Credit Index includes publicly issued U.S. corporate and foreign
debentures and secured notes that meet specified maturity, liquidity, and
quality requirements. All indexes are unmanaged and returns include reinvested
distributions. A more complete description of each index is included in the
Fund's statement of additional information. It is not possible to invest
directly in an index.
2
>SQUIRREL CHATTER: WHY THE HECK SHOULD WE OWN SMALL-CAP STOCKS?
[Photo of Ralph Wanger]
I often get asked the question, "Why own small caps rather than the great
American blue chip companies?" My answer is that many of the so-called blue chip
companies remind me of the Rolling Stones: Once great but 30 years past their
prime.
The rapid change and growth of the past 30 years created today's corporate
behemoths. But that was then. The world has moved on and the environment is
different. This creates a big problem for old giants as the market embraces new
companies that are able to adapt to the world as it is now. The cycle of
creation, growth, maturity and decline can be seen in all companies.
One of the most successful companies for generations was Eastman Kodak.
Today people are switching from film cameras to digital cameras so Kodak's
expertise in making film is fast becoming obsolete. The company is trying
desperately to figure out how to survive in today's world but it is likely to be
a considerably smaller and less profitable company in the years to come.
In the computer industry, IBM was once considered so dominant that the
government brought an antitrust action against the company to keep it from
completely dominating the world. Well, IBM does not dominate the world, but the
antitrust settlement was not the reason for it. IBM had a lock on the mainframe
computer market but PC networks rendered IBM's position irrelevant. IBM is still
a big company but it is no longer dominant in the computer industry.
We also see a great deal of American manufacturing moving overseas,
especially to China. An example is Levi's, a famous brand that was synonymous
with blue jeans. Today Levi's no longer manufactures, distributes or designs
blue jeans anywhere. Levi's owns the brand and collects royalties but the rest
of the business has been turned over to a Hong Kong company named Li & Fung. Li
& Fung outsources the entire production process for Levi's jeans.
This is not the first time foreign markets have encroached upon U.S.
manufacturing. Twenty years ago we were worried about Japan. In area after area,
Japanese companies were knocking off U.S. companies. Ford and General Motors
were suddenly marginalized when Toyota came on the scene. General Motors has
gone from the most powerful company in the United States to what we consider an
unhealthy company with low profits and a poor balance sheet.
Today, the Internet has created new businesses like Ebay, Expedia, and
Amazon and put enormous pressure on old-line companies. Voice over Internet
protocol is likely to do the same thing to the telephone industry that digital
cameras did to Kodak. Free phone calls via the Internet is not the pricing model
that big phone companies have in mind. The music industry has been severely hurt
by file sharing online just as the post office and FedEx are losing market share
to email. There is a great deal of innovation required to keep a business sound
in today's technology-driven world.
One business crushed by the Internet was Encyclopedia Britannica. Believe
it or not, there was a time when research was conducted using books. Now, we
Google. Few of us have a set of Encyclopedia Britannica at home today. Thirty
years ago, we would have. Tornadoes blow away houses everyday that would have
been safe if they only had three hundred pounds of encyclopedias ballasting the
living room like we used to.
Big companies not only have to manage technological change, but they have
to do it in a world of union contracts that have seriously complicated their
ability to change with the times. They must also continually adapt to political
and regulatory changes. Sarbanes-Oxley requirements, for example, have increased
accounting costs for companies.
We think one of the next big battles already underway is with large
pharmaceutical companies. It's fairly well known that you can buy prescription
drugs cheaper in Canada than you can in the United States. Foreign countries
have discovered that they can "free ride" on American-company drug prices
because they don't have to pay for research and development (R&D). Some people
are working to figure out how to increase the amount of drugs imported from
Canada but it makes no sense to make a product in Indianapolis, ship it to
Toronto, and then ship it back to Indianapolis. Government regulation may soon
require that U.S. pharmaceutical companies price drugs sold in the U.S. market
the same as those sent to foreign markets. Perhaps, if drug-company R&D is
3
retained, a subsidy will be issued by the government to cover that cost. If this
happens, major drug companies will find their profits severely reduced. The drug
industry, which was the center of institutional portfolios for the last 50 years
because of steady, stable growth, may be less attractive over the next couple of
decades. This sort of shift has happened before.
Forty years ago electric utilities served as the stable growth base for
institutional portfolios. I can remember having arguments with Duff and Phelps
analysts about whether Commonwealth Edison would have a six-percent growth rate
or a six-and-a-half-percent growth rate in the future. The distinction seemed to
be makeable, reasonable and important. Today, electric utilities don't have
long-term growth rates. They are highly cyclical businesses with profits that
can be variable from one year to the next and are now considered anything but
the base of a stable growth portfolio. While our funds don't own big
pharmaceutical companies or big electric utilities, we think there will always
be small companies that find ways to make money and grow as the old favorites
peak and start to mature and decline.
What kinds of things do the Columbia Acorn Funds look for in small-cap
investing? We've found opportunities in the financial area. We believe regional
banks and savings and loans have the potential to grow and prosper. Sometimes
this occurs because they are in areas where giant banks haven't shown up yet.
Here in Chicago, a few very large banks headquartered elsewhere dominate the
city's banking industry. Still, some people prefer to bank at smaller local
banks where they are treated more as a customer than an account number. Some of
the smaller banks we own in our funds are Glacier Bancorp in Montana, Republic
in Michigan, and Peoples Bank Bridgeport in Connecticut. These companies will
often prosper on their own. If they are taken over by one of the big banks, the
funds would make a profit that way.
Specialty retail is also an interesting area for the small-cap investor.
Retail is dominated by large shopping malls. If someone can formulate a new
retail idea and prove it out with a half-dozen stores, it doesn't take very long
to increase from five stores to 500 because malls always look for new hot
concepts. Some of the companies we own that have done well are Christopher &
Banks, Chico's FAS, Hot Topic, Cheesecake Factory and AFC Enterprises.
An investor may want to look for companies that have very strong brands
such as Procter & Gamble and Gillette. Don't make the mistake of thinking
smaller companies lack recognizable brands. One of Columbia Acorn Fund's most
successful stocks has been Harley-Davidson, the only brand that we can think of
that people tattoo on their bodies. Coach, a top brand in leather goods, is
another small-cap stock owned in the funds. We also own Scotts in lawn care;
International Speedway in NASCAR racing; Carnival in cruise lines and Weight
Watchers in weight watching.
What we look for in all of these companies is what we call a "reason to
own." We need to find a factor that we believe will give a company a reason to
prosper over a long period of time. Our favorite theme under "reason to own" is
Downstream from Technology. Making microchips is a very important business but
when you get into the manufacturing of high-tech devices, it is notoriously
competitive with very short product life cycles, a high degree of price
competition and the profitability of these companies is often very short lived.
It is hard to prosper in a business when you must cut prices 30% every year. We
think it is better to own companies that are CUSTOMERS of these electronic
companies. Getty Images is downstream from technology and one of our favorite
stocks. The company sells photography over the Internet. They have 2.6 million
photos that you can search for by subject and download at a moderate price. If
you want to do an ad with a photo of a retired couple walking on the beach,
buying one of Getty's pictures can save you the money and time required to
create the same shot.
Other downstream stocks that have done well for our funds include Zebra
Technologies, a manufacturer of bar code printers, and International Game
Technology (IGT). IGT has taken a low-priced, microprocessor and used it to
create an electronic slot machine, capitalizing on the American people's
willingness to spend about $30 an hour to play a fairly dull video game. This
willingness also has created the modern gaming industry, which has spread into
most states across the country.
1-800-922-6769
4
Not all technology is electronic. Nektar Therapeutics uses biotech and
technology to generate inhaleable insulin to treat diabetes, one of the most
serious health problems facing Americans. We believe anyone who can change
insulin therapy from injections to some less objectionable form is likely to
have a good business.
Small growth companies may succeed because they grow in the niche areas
between the giants. Of course, not all small companies work but when they do,
there is potential for significant gains. Columbia Acorn Fund profits on stocks
such as IGT and Harley-Davidson have been on the order of 100:1. A good idea, a
hard-working entrepreneur, and long-term equity owners should continue to
partner together to build winning companies in the future.
/s/ Ralph Wanger
Ralph Wanger
FOUNDER, ADVISOR AND TRUSTEE
COLUMBIA WANGER ASSET MANAGEMENT, L.P.
- --------------------------------------------------------------------------------
THIS ESSAY WAS TAKEN FROM A SPEECH GIVEN BY RALPH WANGER AT THE THINKEQUITY
CONFERENCE HELD IN CHICAGO ON JUNE 22, 2004.
AS OF JUNE 30, 2004, FUND POSITIONS IN THE COMPANIES MENTIONED WERE: LI & FUNG:
COLUMBIA ACORN FUND, 0.1%; COLUMBIA ACORN INTERNATIONAL SELECT FUND, 1.6%.
GLACIER BANCORP: COLUMBIA ACORN FUND, 0.5%. REPUBLIC: COLUMBIA ACORN FUND, 0.2%.
PEOPLES BANK BRIDGEPORT: COLUMBIA ACORN FUND, 0.8%. CHRISTOPHER & BANKS:
COLUMBIA ACORN FUND, 0.5%; COLUMBIA ACORN USA, 0.8%. CHICO'S FAS: COLUMBIA ACORN
FUND, 0.9%. HOT TOPIC: COLUMBIA ACORN FUND, 0.2%. CHEESECAKE FACTORY: COLUMBIA
ACORN FUND, 0.1%. AFC ENTERPRISES: COLUMBIA ACORN FUND, 0.3%. HARLEY-DAVIDSON:
COLUMBIA ACORN FUND, 0.9%; COLUMBIA ACORN SELECT, 6.3%. COACH: COLUMBIA ACORN
FUND, 1.0%; COLUMBIA ACORN USA, 0.4%; COLUMBIA ACORN SELECT, 2.9%. SCOTTS
COMPANY: COLUMBIA ACORN FUND, 0.5%; COLUMBIA ACORN USA, 1.4%. INTERNATIONAL
SPEEDWAY MOTORS: COLUMBIA ACORN FUND, 0.3%; COLUMBIA ACORN USA, 0.6%; COLUMBIA
ACORN SELECT, 2.3%. CARNIVAL: COLUMBIA ACORN FUND, 0.2%. WEIGHT WATCHERS:
COLUMBIA ACORN FUND, 0.2%; COLUMBIA ACORN USA, 0.3%; COLUMBIA ACORN SELECT,
2.9%. GETTY IMAGES: COLUMBIA ACORN FUND, 0.6%; COLUMBIA ACORN USA, 0.8%. ZEBRA
TECHNOLOGIES: COLUMBIA ACORN FUND, 0.3%; COLUMBIA ACORN USA, 1.9%. INTERNATIONAL
GAME TECHNOLOGY: COLUMBIA ACORN FUND, 2.1%. NEKTAR THERAPEUTICS: COLUMBIA ACORN
FUND, 0.2%; COLUMBIA ACORN USA, 0.9%.
COMPANIES THAT WERE MENTIONED BUT NOT LISTED ABOVE WERE NOT HELD BY ANY OF THE
COLUMBIA ACORN FUNDS AS OF JUNE 30, 2004.
THE COMPANIES NAMED ARE FOR ILLUSTRATION PURPOSES ONLY AND ARE NOT INTENDED TO
BE A RECOMMENDATION TO BUY OR SELL ANY STOCK.
5
COLUMBIA ACORN FUND
> IN A NUTSHELL
[Photo of Charles P. McQuaid] [Photo of Robert A. Mohn]
Columbia Acorn Fund rose 1.65% in the second quarter, somewhat more than
its smaller cap benchmarks and in line with the large-cap S&P 500. In the first
half of 2004, Columbia Acorn grew 8.99%, beating all of its benchmarks (see Page
2 for performance data). Performance for both periods was helped by our
investments in energy. We also profited from good stock picking.
On the advice of our energy analyst, Jason Selch, we had built energy to
about 9% of the Fund--nearly twice the energy weighting of the Russell 2500
Index. Energy prices remained high, and both our large weighting and fine stock
selection paid off. Quicksilver hit pay dirt, and was Columbia Acorn's largest
percentage winner in both periods, rising about 73% in the quarter and doubling
in the half. XTO Energy was the Fund's largest dollar winner year-to-date,
gaining over $200 million for shareholders while rising 32%. Other energy
successes included Western Gas and Ultra Petroleum, each up more than 24% in the
quarter and 35% in the half.
Other excellent stock picks included Rogers, a provider of electronic
components, up on fine earnings. Retailer Urban Outfitters also jumped, as
amazing sales increases drove earnings. Cell phone service provider Western
Wireless benefited from growth overseas. Each of these stocks jumped at least
24% in the quarter and 57% in the half.
Gaming stocks were volatile. International Game Technology was Columbia
Acorn's largest dollar winner in the first quarter but its largest dollar loser
in the second, despite making its growth targets. For the half, it rose 9%. We
trimmed the stock due to valuation concerns, locking in fantastic gains.
Alliance Gaming gained 30% in the first quarter, but dropped 47% in the second
quarter on lower earnings expectations. Technology was tough year-to-date, as
gains in hardware stocks were more than offset by drops in the Fund's software
and service companies. After a 49% gain in the first quarter, Skillsoft
Publishing retreated 41% on an order shortfall.
Columbia Acorn's foreign stocks rose 2.42% in the quarter and 10.02% in the
half. Gambro, a leading worldwide dialysis provider, and Rhoen-Klinikum, a
leading private hospital company in Germany, each rose more than 25% in the
quarter. United Kingdom-based Tullow Oil gained 49% in the half. We've built the
Fund's foreign stock position to 15% of assets, and plan to stay near this level
since we believe foreign stocks appear attractive.
Most of the Fund's companies are reporting what we consider good business
conditions and excellent earnings gains. Macro economic concerns recently have
kept a lid on stock prices. We hope that earnings gains will rule in the future.
/s/ Charles P. McQuaid /s/ Robert A. Mohn
Charles P. McQuaid Robert A. Mohn
LEAD PORTFOLIO MANAGER CO-PORTFOLIO MANAGER
DEMOGRAPHY IS DESTINY
- --------------------------------------------------------------------------------
The baby boomer population continues to provide investment opportunities. Baby
boomers are aging worldwide and many are becoming obese. Age plus obesity has
caused an epidemic of diabetes. This disease often causes kidney failure.
Gambro, headquartered in Sweden, operates dialysis centers and sells renal
products in many parts of the world. Columbia Wanger Asset Management analyst
Stephen Kusmierczak concluded that Gambro was improving its cost structure and
enhancing its sales mix. He saw through goodwill amortization charges and valued
the stock based on free cash flow. When Stephen's research indicated that the
market expectations concerning Medicare dialysis reimbursement may be unduly
pessimistic, we added to Columbia Acorn Fund's position. Good research paid off
as Gambro's stock rose 30% in the second quarter.
INVESTMENTS IN SMALL-CAP COMPANIES MAY BE SUBJECT TO GREATER VOLATILITY AND
PRICE FLUCTUATIONS BECAUSE THEY MAY BE THINLY TRADED AND LESS LIQUID THAN
INVESTMENTS IN LARGER COMPANIES. INVESTMENTS IN FOREIGN SECURITIES HAVE SPECIAL
RISKS, INCLUDING POLITICAL OR ECONOMIC INSTABILITY, HIGHER COSTS, DIFFERENT
REGULATIONS, ACCOUNTING STANDARDS, TRADING PRACTICES AND LEVELS OF INFORMATION,
AND CURRENCY EXCHANGE RATE FLUCTUATIONS.
AS OF 6/30/04, THE FUND'S POSITIONS IN THE HOLDINGS MENTIONED WERE: QUICKSILVER,
0.3%; XTO ENERGY, 1.8%; WESTERN GAS, 0.7%; ULTRA PETROLEUM, 0.7%; ROGERS, 0.3%;
URBAN OUTFITTERS, 0.4%; WESTERN WIRELESS, 0.7%; INTERNATIONAL GAME TECHNOLOGY,
2.1%; ALLIANCE GAMING, 0.4%; SKILLSOFT PUBLISHING, 0.6%; RHOEN-KLINIKUM, 0.2%;
TULLOW OIL, 0.3%; GAMBRO, 0.2%.
1-800-922-6769
6
COLUMBIA ACORN FUND
>AT A GLANCE TICKER SYMBOL: ACRNX
PRETAX AND AFTER-TAX AVERAGE ANNUAL TOTAL RETURNS (CLASS Z)
>through June 30, 2004
YEAR
TO DATE* 1 YEAR 5 YEARS 10 YEARS
-------- ------ ------- --------
Returns before taxes 8.99% 35.90% 13.94% 15.65%
Returns after taxes 8.97 35.86 12.26 13.54
on distributions
Returns after taxes 5.87 23.39 11.37 12.80
on distributions and
sale of fund shares
S&P 500 (pretax) 3.44 19.11 -2.20 11.83
Russell 2500 (pretax) 6.24 32.21 8.47 13.08
Russell 2000 (pretax) 6.76 33.37 6.63 10.93
Past performance, before and after taxes, cannot predict future investment
results. After-tax returns are calculated using the highest historical
individual federal marginal income tax rates, and do not reflect the impact of
state and local taxes. Returns after taxes on distributions and sale of fund
shares reflect the additional tax impact of long-term gains or losses realized
when fund shares are sold. The returns are taxed at the maximum rate and assume
shares were purchased at the beginning of the period. Actual after-tax returns
depend on the investor's tax situation and may differ from those shown.
After-tax returns are not relevant to investors who hold their fund shares
through tax-deferred arrangements such as 401(k) plans or individual retirement
accounts. After-tax returns are shown for class Z shares only; after-tax returns
for other share classes will vary. Indexes do not reflect any deduction for
fees, expenses or taxes.
Investment returns and principal value may fluctuate, resulting in a gain or
loss on sale.
*Year to date data not annualized.
COLUMBIA ACORN FUND PORTFOLIO DIVERSIFICATION
>as a % of net assets, as of June 30, 2004
[PIE CHART]
Consumer Goods/Services 21.8%
Industrial Goods/Services 13.5%
Finance 12.3%
Other* 6.7%
Health Care 9.1%
Energy/Minerals 9.1%
Real Estate 2.6%
Information 24.9%
Software/Services 11.6%
Computer Related Hardware 8.0%
Media 2.1%
Telecommunications 3.2%
*Other includes cash and other assets less liabilities of 5.7%. Foreign equities
within the portfolio were 15.0% diversified by country as follows: 9.0% Europe;
1.7% Asia without Japan; 2.0% Canada; 1.3% Japan; 0.5% Australia/New Zealand;
0.5% Latin America.
THE VALUE OF A $10,000 INVESTMENT IN COLUMBIA ACORN FUND (CLASS Z)
>June 10, 1970 through June 30, 2004
This graph compares the results of $10,000 invested in Columbia Acorn Fund at
inception on June 10, 1970 to the S&P 500 Stock Index, a broad, market-weighted
average of U.S. blue-chip company stock performance. The index is unmanaged and
returns for both the index and the Fund include reinvested dividends and capital
gains. It is not possible to invest directly in an index. The graph and table do
not reflect tax deductions that a shareholder would pay on Fund distributions or
the sale of Fund shares.
PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND
PRINCIPAL VALUE OF AN INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT FUND SHARES,
WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. PERFORMANCE
CHANGES OVER TIME. VISIT COLUMBIAFUNDS.COM FOR DAILY UPDATES.
COLUMBIA ACORN FUND NAV ON 6/30/04: $24.56
TOTAL NET ASSETS: $12,289.6 MILLION
[MOUNTAIN CHART]
AVERAGE ANNUAL TOTAL RETURN
------------------------------------------
1 YEAR 5 YEARS 10 YEARS LIFE OF FUND
35.90% 13.94% 15.65% 16.34%
COLUMBIA
ACORN
FUND S&P 500
------------- -------------
6/10/70 9694.96 9819.82
6/30/70 10517.20 10575.00
7/31/70 11223.10 11081.10
8/31/70 12022.80 11481.20
9/30/70 11916.20 11385.80
10/31/70 12169.40 11962.10
11/30/70 13586.70 12676.20
12/31/70 14953.40 13224.70
1/31/71 15837.70 13378.40
2/28/71 17020.50 13905.70
3/31/71 18230.50 14446.20
4/30/71 17275.90 13881.80
5/31/71 17397.30 13928.20
6/30/71 17289.40 13389.00
7/31/71 17640.10 13908.30
8/31/71 17571.50 13846.10
9/30/71 16516.40 13304.20
10/31/71 15677.70 13306.80
11/30/71 17828.50 14489.90
12/31/71 18652.50 14788.00
1/31/72 19648.80 15197.40
2/29/72 20119.20 15323.30
3/31/72 20672.70 15426.60
4/30/72 20824.90 15731.30
5/31/72 20562.00 15425.30
6/30/72 19521.50 15498.10
7/31/72 19129.90 16070.50
8/31/72 18962.10 16029.40
9/30/72 18920.10 16218.90
10/31/72 19745.20 17000.50
11/30/72 19367.60 17241.70
12/31/72 18270.10 16984.60
1/31/73 16883.50 16385.80
2/28/73 16563.50 16399.00
3/31/73 15055.00 15373.60
4/30/73 13637.80 15515.40
5/31/73 13637.80 15453.10
6/30/73 15214.60 16081.10
7/31/73 14555.10 15532.60
8/31/73 16825.00 16196.30
9/30/73 17469.20 16222.80
10/31/73 14877.20 14423.70
11/30/73 14769.80 14708.50
12/31/73 15110.60 14603.90
1/31/74 15188.10 14593.30
2/28/74 15017.60 14293.90
3/31/74 13824.30 13781.10
4/30/74 12925.40 13365.10
5/31/74 12506.90 13212.80
6/30/74 11718.20 12366.20
7/31/74 10621.60 11176.50
8/31/74 9697.29 9888.71
9/30/74 12015.90 11551.40
10/31/74 11436.20 10987.00
11/30/74 10684.30 10816.10
12/31/74 12371.50 12191.30
1/31/75 12895.60 12969.00
2/28/75 13022.60 13298.90
3/31/75 13642.00 13975.90
4/30/75 14928.40 14642.30
5/31/75 15944.80 15341.80
6/30/75 15106.10 14353.50
7/31/75 14224.10 14100.40
8/31/75 13646.80 13660.60
9/30/75 14160.00 14553.50
10/31/75 14224.10 14964.20
11/30/75 13951.50 14842.30
12/31/75 16285.70 16649.40
1/31/76 17970.90 16509.00
2/29/76 18959.40 17065.40
3/31/76 18943.20 16933.00
4/30/76 19461.80 16744.80
5/31/76 20498.90 17486.80
6/30/76 19796.30 17403.30
7/31/76 19861.60 17371.50
8/31/76 20727.30 17819.30
9/30/76 19926.90 17488.10
10/31/76 21217.30 17416.50
11/30/76 23046.60 18394.30
12/31/76 24091.10 17523.80
1/31/77 23235.40 17204.60
2/28/77 23910.10 17024.40
3/31/77 24486.10 17094.60
4/30/77 24979.70 16759.40
5/31/77 26608.90 17587.40
6/30/77 26441.50 17368.80
7/31/77 25778.00 17070.70
8/31/77 25628.70 17097.20
9/30/77 24666.60 16430.80
10/31/77 26740.10 16950.20
11/30/77 27171.40 17077.40
12/31/77 25528.80 16097.00
1/31/78 25780.50 15771.10
2/28/78 26754.00 16234.80
3/31/78 28919.20 17698.70
4/30/78 30094.10 17861.70
5/31/78 30094.10 17616.60
6/30/78 32149.90 18643.30
7/31/78 35492.20 19203.80
8/31/78 34745.70 19142.80
9/30/78 28519.30 17473.50
10/31/78 30826.60 17848.40
11/30/78 31776.70 18199.50
12/31/78 33357.00 19006.40
1/31/79 32583.80 18395.60
2/28/79 36376.10 19492.60
3/31/79 36504.90 19617.10
4/30/79 37057.20 19189.20
5/31/79 40131.50 20023.80
6/30/79 41505.20 20292.80
7/31/79 44852.30 21464.00
8/31/79 45298.60 21555.40
9/30/79 42063.00 20174.90
10/31/79 45614.80 21134.10
11/30/79 47790.40 21585.90
12/31/79 50478.20 22927.90
1/31/80 50602.40 22926.60
2/29/80 42258.40 20696.90
3/31/80 44556.60 21654.70
4/30/80 47393.20 22768.90
5/31/80 49111.70 23489.70
6/30/80 52126.70 25123.20
7/31/80 54232.80 25377.60
8/31/80 56697.00 26124.80
9/30/80 57876.40 26653.40
10/31/80 61793.80 29492.60
11/30/80 62594.10 28602.30
12/31/80 61405.10 27405.90
1/31/81 61124.80 27881.60
2/28/81 65118.90 28997.10
3/31/81 65445.90 28436.70
4/30/81 66637.10 28509.50
5/31/81 64184.60 28330.70
6/30/81 61688.10 28389.00
7/31/81 57933.60 26750.10
8/31/81 54131.50 25431.90
9/30/81 57600.90 26804.50
10/31/81 58955.30 27910.70
11/30/81 58004.80 27195.30
12/31/81 55855.50 26840.20
1/31/82 54397.10 25339.20
2/28/82 53546.40 25206.70
3/31/82 55247.80 26346.10
4/30/82 54299.90 25447.80
5/31/82 53692.20 25066.20
6/30/82 52745.60 24619.80
7/31/82 55713.30 27608.60
8/31/82 56586.10 27953.10
9/30/82 62596.40 31169.80
10/31/82 67559.20 32429.80
11/30/82 68207.60 33053.80
12/31/82 71999.10 34283.30
1/31/83 75490.60 35068.90
2/28/83 77580.20 36364.60
3/31/83 80463.40 39228.90
4/30/83 85065.80 38888.40
5/31/83 87777.20 40401.40
6/30/83 85603.50 39209.10
7/31/83 83886.10 39798.60
8/31/83 85388.90 40347.10
9/30/83 82356.50 39880.80
10/31/83 85254.70 40722.00
11/30/83 85388.90 40510.10
12/31/83 82835.90 40283.50
1/31/84 79613.70 38865.90
2/29/84 80298.10 39539.00
3/31/84 80212.50 39913.90
4/30/84 77304.00 37705.40
5/31/84 79416.90 38524.10
6/30/84 78263.90 38045.80
7/31/84 87574.80 42248.30
8/31/84 87718.90 42257.60
9/30/84 87978.40 42420.50
10/31/84 87401.90 41946.20
11/30/84 89045.00 43051.10
12/31/84 98794.40 46405.70
1/31/85 100452.00 46974.00
2/28/85 99746.10 47004.50
3/31/85 99838.20 46960.80
4/30/85 105733.00 49674.10
5/31/85 107107.00 50451.80
6/30/85 108625.00 50378.90
7/31/85 107665.00 49948.30
8/31/85 103142.00 48386.30
9/30/85 107696.00 50621.40
10/31/85 114788.00 54092.50
11/30/85 117142.00 56710.40
12/31/85 119848.00 57027.00
1/31/86 126521.00 61289.10
2/28/86 132668.00 64708.50
3/31/86 134936.00 63979.90
4/30/86 139176.00 67383.40
5/31/86 141429.00 68522.80
6/30/86 134782.00 64690.00
7/31/86 138982.00 69487.30
8/31/86 132005.00 63742.70
9/30/86 134914.00 67417.90
10/31/86 136502.00 69096.40
11/30/86 136843.00 67294.60
12/31/86 147564.00 76356.70
1/31/87 157864.00 79373.30
2/28/87 160298.00 81664.00
3/31/87 155055.00 80938.00
4/30/87 158913.00 81640.20
5/31/87 164942.00 85763.10
6/30/87 170980.00 90107.30
7/31/87 179878.00 93469.80
8/31/87 180519.00 91420.20
9/30/87 135087.00 71731.60
10/31/87 133089.00 65826.70
11/30/87 142923.00 70828.00
12/31/87 147022.00 73807.60
1/31/88 158881.00 77248.30
2/29/88 159366.00 74860.90
3/31/88 163642.00 75688.90
4/30/88 161394.00 76343.40
5/31/88 169946.00 79847.60
6/30/88 171144.00 79544.30
7/31/88 167856.00 76844.20
8/31/88 173543.00 80117.90
9/30/88 174832.00 82349.00
10/31/88 172344.00 81175.10
11/30/88 178370.00 82591.40
12/31/88 185925.00 88639.40
1/31/89 189702.00 86430.80
2/28/89 192253.00 88447.30
3/31/89 200936.00 93039.20
4/30/89 208099.00 96803.10
5/31/89 204223.00 96254.60
6/30/89 215945.00 104944.00
7/31/89 221422.00 106997.00
8/31/89 226493.00 106562.00
9/30/89 213358.00 104089.00
10/31/89 217568.00 106211.00
11/30/89 222681.00 108761.00
12/31/89 208258.00 101460.00
1/31/90 210852.00 102766.00
2/28/90 217234.00 105490.00
3/31/90 210956.00 102858.00
4/30/90 226002.00 112887.00
5/31/90 229686.00 112125.00
6/30/90 226379.00 111766.00
7/31/90 195903.00 101664.00
8/31/90 175081.00 96715.70
9/30/90 170959.00 96303.70
10/31/90 177743.00 102529.00
11/30/90 183674.00 105386.00
12/31/90 194615.00 109975.00
1/31/91 210518.00 117839.00
2/28/91 219033.00 120693.00
3/31/91 226082.00 120979.00
4/30/91 236741.00 126198.00
5/31/91 226533.00 120416.00
6/30/91 237001.00 126029.00
7/31/91 245977.00 129014.00
8/31/91 246204.00 126856.00
9/30/91 253986.00 128561.00
10/31/91 246772.00 123381.00
11/30/91 270641.00 137492.00
12/31/91 285157.00 134930.00
1/31/92 295551.00 136684.00
2/29/92 293460.00 134018.00
3/31/92 284576.00 137954.00
4/30/92 285796.00 138630.00
5/31/92 278828.00 136567.00
6/30/92 289313.00 142146.00
7/31/92 284681.00 139238.00
8/31/92 289723.00 140877.00
9/30/92 305027.00 141361.00
10/31/92 322837.00 146174.00
11/30/92 336210.00 147928.00
12/31/92 350678.00 149205.00
1/31/93 349705.00 151239.00
2/28/93 368610.00 154429.00
3/31/93 359370.00 150697.00
4/30/93 388973.00 154728.00
5/31/93 393411.00 155182.00
6/30/93 391413.00 154556.00
7/31/93 417246.00 160421.00
8/31/93 429428.00 159193.00
9/30/93 445772.00 162484.00
10/31/93 428938.00 160935.00
11/30/93 444889.00 162882.00
12/31/93 447121.00 168418.00
1/31/94 441700.00 163847.00
2/28/94 420332.00 156704.00
3/31/94 423840.00 158714.00
4/30/94 419057.00 161318.00
5/31/94 404705.00 157364.00
6/30/94 417781.00 162532.00
7/31/94 437059.00 169194.00
8/31/94 431588.00 165057.00
9/30/94 429979.00 168765.00
10/31/94 413243.00 162619.00
11/30/94 411750.00 165032.00
12/31/94 404013.00 169311.00
1/31/95 417133.00 175910.00
2/28/95 423188.00 181101.00
3/31/95 427897.00 186433.00
4/30/95 441017.00 193884.00
5/31/95 458846.00 198388.00
6/30/95 481143.00 204967.00
7/31/95 486243.00 205482.00
8/31/95 496104.00 214155.00
9/30/95 475362.00 213389.00
10/31/95 488963.00 222756.00
11/30/95 497407.00 227047.00
12/31/95 505453.00 234775.00
1/31/96 525203.00 236952.00
2/29/96 535444.00 239232.00
3/31/96 563972.00 242760.00
4/30/96 584087.00 249020.00
5/31/96 572749.00 249970.00
6/30/96 543209.00 238927.00
7/31/96 563988.00 243967.00
8/31/96 584766.00 257697.00
9/30/96 581798.00 264805.00
10/31/96 598124.00 284821.00
11/30/96 609569.00 279177.00
12/31/96 631050.00 296619.00
1/31/97 622944.00 297752.00
2/28/97 594573.00 286661.00
3/31/97 597816.00 303775.00
4/30/97 645235.00 322269.00
5/31/97 674822.00 336708.00
6/30/97 709392.00 363498.00
7/31/97 712680.00 343135.00
8/31/97 767344.00 361926.00
9/30/97 744739.00 349840.00
10/31/97 744739.00 366035.00
11/30/97 761852.00 372320.00
12/31/97 748400.00 376439.00
1/31/98 803106.00 403589.00
2/28/98 853328.00 424257.00
3/31/98 865884.00 428524.00
4/30/98 833150.00 421159.00
5/31/98 850978.00 438266.00
6/30/98 802766.00 433600.00
7/31/98 656313.00 370910.00
8/31/98 684967.00 394671.00
9/30/98 719533.00 426775.00
10/31/98 749097.00 452640.00
11/30/98 807685.00 478724.00
12/31/98 807206.00 498743.00
1/31/99 770776.00 483242.00
2/28/99 778925.00 502576.00
3/31/99 842677.00 522039.00
4/30/99 856098.00 509711.00
5/31/99 901844.00 537999.00
6/30/99 914942.00 521200.00
7/31/99 888260.00 518622.00
8/31/99 883409.00 504404.00
9/30/99 910091.00 536324.00
10/31/99 974612.00 547226.00
11/30/99 1077260.00 579455.00
12/31/99 1051090.00 550342.00
1/31/00 1129000.00 539924.00
2/29/00 1081910.00 592744.00
3/31/00 1044700.00 574911.00
4/30/00 1022610.00 563116.00
5/31/00 1062100.00 576998.00
6/30/00 1066420.00 567977.00
7/31/00 1144140.00 603257.00
8/31/00 1163260.00 571409.00
9/30/00 1133650.00 568993.00
10/31/00 1074010.00 524134.00
11/30/00 1185610.00 526699.00
12/31/00 1207650.00 545386.00
1/31/01 1177340.00 495657.00
2/28/01 1124300.00 464257.00
3/31/01 1223500.00 500334.00
4/30/01 1275170.00 503686.00
5/31/01 1293240.00 491427.00
6/30/01 1268730.00 486590.00
7/31/01 1218320.00 456128.00
8/31/01 1053070.00 419295.00
9/30/01 1097880.00 427290.00
10/31/01 1182610.00 460066.00
11/30/01 1258360.00 464097.00
12/31/01 1246390.00 457324.00
1/31/02 1230910.00 448504.00
2/28/02 1320990.00 465372.00
3/31/02 1318180.00 437158.00
4/30/02 1278770.00 433937.00
5/31/02 1214020.00 403024.00
6/30/02 1070450.00 371610.00
7/31/02 1079600.00 374050.00
8/31/02 1015550.00 333398.00
9/30/02 1058480.00 362743.00
10/31/02 1126750.00 384093.00
11/30/02 1090860.00 361529.00
12/31/02 1065520.00 352058.00
1/31/03 1048630.00 346776.00
2/28/03 1062000.00 350143.00
3/31/03 1154200.00 378984.00
4/30/03 1236540.00 398952.00
5/31/03 1274540.00 404041.00
6/30/03 1334360.00 411165.00
7/31/03 1404740.00 419183.00
8/31/03 1388550.00 414732.00
9/30/03 1501860.00 438193.00
10/31/03 1550420.00 442049.00
11/30/03 1589180.00 465234.00
12/31/03 1646950.00 473771.00
1/31/04 1678650.00 480356.00
2/28/04 1704000.00 473109.00
3/31/04 1643420.00 465683.00
4/30/04 1673010.00 472073.00
5/31/04 1732120.00 481252.00
6/30/04 1732120.00 481252.00
COLUMBIA ACORN FUND TOP 10 HOLDINGS (AS A % OF NET ASSETS)
1. International Game Technology 2.1%
SLOT MACHINES & PROGRESSIVE JACKPOTS
2. XTO Energy 1.8%
NATURAL GAS PRODUCER
3. Expeditors International of Washington 1.1%
INTERNATIONAL FREIGHT FORWARDER
4. Coach 1.0%
DESIGNER & RETAILER OF BRANDED LEATHER ACCESSORIES
5. AmeriCredit 0.9%
AUTO LENDING
6. Chico's FAS 0.9%
WOMEN'S SPECIALTY RETAILER
7. Harley-Davidson 0.9%
MOTORCYCLES & RELATED MERCHANDISE
8. Peoples Bank Bridgeport 0.8%
CONNECTICUT SAVINGS & LOAN
9. TCF Financial 0.8%
GREAT LAKES BANK
10.Novell 0.8%
DIRECTORY, OPERATING SYSTEM & IDENTITY MANAGEMENT SOFTWARE
The Fund's top 10 holdings and portfolio diversification vary with changes in
portfolio investments. See the Statement of Investments for a complete list of
the Fund's holdings.
7
COLUMBIA ACORN INTERNATIONAL
>IN A NUTSHELL
[Photo of P.Zachary Egan] [Photo of Louis J. Mendes III]
Columbia Acorn International finished the quarter up 1.77%, exceeding by
just over 2% the Citigroup EMI Global ex-US benchmark decline of 0.24%. By
posting a positive result in a flat market, the Fund gained back much of the
ground lost relative to its benchmark in the first quarter. It is now up 8.78%
year-to-date, trailing the benchmark return of 9.52%. The Fund also led the
larger cap MSCI EAFE Index by 1.55% in the quarter and 4.22% year-to-date. Stock
selection, as opposed to country or sector weightings, was the primary driver of
performance in the second quarter.
Winners included Kappa Create, a sushi restaurant chain in Japan, which was
up 20% in the second quarter, after rising 31% in the first quarter. Geberit, a
Swiss manufacturer of bathroom plumbing systems, was up 23% in the quarter and
up 37% for the first half of the year. Energy prices remain high, which boosted
profitability for many energy exploration and production companies. A holding in
the United Kingdom, Tullow Oil, was up 23% in the quarter and nearly 49% for the
six months. Rhoen-Klinikum, a private hospital operator in Germany and the
Fund's second largest holding, also had a strong second quarter, rising 26%.
The Fund's biggest loser in the second quarter was ASE Test, a
semiconductor packaging and test services company, which was down 33% in the
quarter and 51% in the year-to-date period on concerns that excess capacity in
the semiconductor industry will weigh on profitability. Sales data for June,
however, show an 88% increase over numbers reported this time last year. While
the stock continues to exhibit volatility, we feel the fundamental investment
case remains intact. Another laggard was Jardine Lloyd Thompson Group, an
insurance broker in the United Kingdom, which was down over 20% for both the
quarter and the first half. Wah Lee Industrial, a Taiwanese distributor of
chemicals, materials and equipment, was down 15% for the quarter and 19% for the
first half.
We continued to increase the Fund's exposure to Japan in the quarter,
largely in businesses geared to the domestic economy, such as consumer goods and
services, and financials. We also built small positions in countries where the
Fund had little or no exposure in recent years. In South Africa, the Fund now
holds family clothing chain Edgars Consolidated Stores. In Brazil, Columbia
Acorn International participated in the initial public offering of Natura
Cosmeticos, a direct retailer of high-end skin care products. These investments
reflect the Fund's continuous efforts to locate value wherever it may be.
/s/ P. Zachary Egan /s/ Louis J. Mendes III
P. Zachary Egan Louis J. Mendes III
CO-PORTFOLIO MANAGER CO-PORTFOLIO MANAGER
PROFITS IN THE WIND
- --------------------------------------------------------------------------------
Gamesa manufactures and services wind-driven turbines and develops and operates
so-called "wind-farms" for electric generation. Columbia Acorn International
built a position in the company two and a half years ago when we believed there
was considerable opportunity for the company to strengthen its balance sheet by
selling some of its Spanish windfarms. We felt that freeing up cash through
these asset sales would also allow the company to pursue higher return projects
outside of Spain. This strategy was so successful that management was looking to
return cash to shareholders within nine months of the Fund's initial investment,
and the share price has almost tripled over the holding period. While originally
an attempt to strengthen the financial position of the company, selling
windfarms is now viewed by management as a sustainable, high-return business
opportunity in itself. While some investors are skeptical about this strategic
direction, we believe that Gamesa, as a leading equipment supplier with an
intimate understanding of the planning and permit process, is indeed
well-positioned to benefit as a windfarm developer.
INVESTMENTS IN FOREIGN SECURITIES HAVE SPECIAL RISKS, INCLUDING POLITICAL OR
ECONOMIC INSTABILITY, HIGHER COSTS, DIFFERENT REGULATIONS, ACCOUNTING STANDARDS,
TRADING PRACTICES AND LEVELS OF INFORMATION, AND CURRENCY EXCHANGE RATE
FLUCTUATIONS. INVESTMENTS IN SMALL-CAP COMPANIES MAY BE SUBJECT TO GREATER
VOLATILITY AND PRICE FLUCTUATIONS BECAUSE THEY MAY BE THINLY TRADED AND LESS
LIQUID THAN INVESTMENTS IN LARGER COMPANIES.
AS OF 6/30/04, THE FUND'S POSITIONS IN THE HOLDINGS MENTIONED WERE: KAPPA
CREATE, 0.8%; GEBERIT, 1.0%; TULLOW OIL, 1.2%; RHOEN-KLINIKUM, 1.9%; ASE TEST,
0.5%; JARDINE LLOYD THOMPSON GROUP, 0.7%; WAH LEE INDUSTRIAL, 0.4%; EDGARS
CONSOLIDATED STORES, 0.3%; NATURA COSMETICOS, 0.5%; GAMESA, 0.7%.
1-800-922-6769
8
COLUMBIA ACORN INTERNATIONAL
>AT A GLANCE TICKER SYMBOL: ACINX
PRETAX AND AFTER-TAX AVERAGE ANNUAL TOTAL RETURNS (CLASS Z)
>through June 30, 2004
YEAR
TO DATE* 1 YEAR 5 YEARS 10 YEARS
-------- ------ ------- --------
Returns before taxes 8.78% 41.42% 5.48% 8.62%
Returns after taxes 8.38 41.12 4.29 7.67
on distributions
Returns after taxes 5.70 27.13 4.32 7.23
on distributions and
sale of fund shares
Citigroup EMI Global 9.52 44.13 6.22 4.42
ex-US (pretax)
Past performance, before and after taxes, cannot predict future investment
results. After-tax returns are calculated using the highest historical
individual federal marginal income tax rates, and do not reflect the impact of
state and local taxes. Returns after taxes on distributions and sale of fund
shares reflect the additional tax impact of long-term gains or losses realized
when fund shares are sold. The returns are taxed at the maximum rate and assume
shares were purchased at the beginning of the period. Actual after-tax returns
depend on the investor's tax situation and may differ from those shown.
After-tax returns are not relevant to investors who hold their fund shares
through tax-deferred arrangements such as 401(k) plans or individual retirement
accounts. After-tax returns are shown for class Z shares only; after-tax returns
for other share classes will vary. The return after taxes on distributions may
be higher than the return before taxes due to qualified foreign tax credits.
Indexes do not reflect any deduction for fees, expenses or taxes.
Investment returns and principal value may fluctuate, resulting in a gain or
loss on sale.
*Year to date data not annualized.
COLUMBIA ACORN INTERNATIONAL PORTFOLIO DIVERSIFICATION
>as a % of net assets, as of June 30, 2004
[PIE CHART]
Consumer Goods/Services 24.8%
Finance 12.1%
Other* 5.1%
Information Technology 10.6%
Health Care 8.5%
Energy/Minerals 8.1%
Transportation 3.0%
Industrial Goods/Services 27.8%
*Other includes cash and other assets less liabilities of 3.2%.
THE VALUE OF A $10,000 INVESTMENT IN COLUMBIA ACORN INTERNATIONAL (CLASS Z)
>September 23, 1992 through June 30, 2004
This graph compares the results of $10,000 invested in Columbia Acorn
International at inception on September 23, 1992 to the Citigroup EMI Global
ex-US, Citigroup's index of the bottom 20% of institutionally investable capital
of developed and emerging countries, as selected by Citigroup, excluding the
U.S. The index is unmanaged and returns for both the index and Fund include
reinvested dividends and capital gains. It is not possible to invest directly in
an index. The graph and table do not reflect tax deductions that a shareholder
would pay on Fund distributions or the sale of Fund shares.
PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND
PRINCIPAL VALUE OF AN INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT FUND SHARES,
WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. PERFORMANCE
CHANGES OVER TIME. VISIT COLUMBIAFUNDS.COM FOR DAILY UPDATES.
COLUMBIA ACORN INTERNATIONAL NAV ON 6/30/04: $24.39
TOTAL NET ASSETS: $1,728.2 MILLION
[MOUNTAIN CHART]
AVERAGE ANNUAL TOTAL RETURN
------------------------------------------
1 YEAR 5 YEARS 10 YEARS LIFE OF FUND
41.42% 5.48% 8.62% 11.38%
COLUMBIA CITIGROUP
ACORN EMI GLOBAL
INTERNATIONAL EX-US
------------- -------------
9/23/92 10010.00 10000.00
9/30/92 10380.00 9383.91
10/31/92 10570.00 9403.64
11/30/92 10690.00 9537.99
12/31/92 10780.00 9623.14
1/31/93 11460.00 9965.42
2/28/93 12000.00 10968.70
3/31/93 12450.00 11975.90
4/30/93 12910.00 12611.20
5/31/93 12920.00 12126.90
6/30/93 12920.00 12500.40
7/31/93 13760.00 13145.40
8/31/93 13910.00 12871.10
9/30/93 14560.00 12825.70
10/31/93 14620.00 11753.50
11/30/93 15940.00 12508.70
12/31/93 16630.00 13759.70
1/31/94 16570.00 13855.90
2/28/94 15850.00 13629.20
3/31/94 15960.00 14036.90
4/30/94 15870.00 13834.00
5/31/94 15550.00 14122.60
6/30/94 15980.00 14289.40
7/31/94 16481.40 14451.90
8/31/94 16491.50 14040.50
9/30/94 16521.70 14277.80
10/31/94 15606.00 13454.40
11/30/94 15334.40 13537.60
12/31/94 14640.10 12974.20
1/31/95 14549.50 12760.30
2/28/95 14811.10 13250.60
3/31/95 15263.90 13662.70
4/30/95 15505.40 13487.70
5/31/95 15726.80 13338.70
6/30/95 16582.20 14086.10
7/31/95 16411.00 13752.70
8/31/95 16823.80 13845.30
9/30/95 16300.30 13431.40
10/31/95 16068.70 13547.00
11/30/95 16703.00 14056.20
12/31/95 17357.40 14388.00
1/31/96 17881.00 14556.00
2/29/96 18203.20 14862.80
3/31/96 18787.10 15629.20
4/30/96 19340.90 15506.80
5/31/96 19592.60 15499.60
6/30/96 18967.90 14897.90
7/31/96 19240.40 15045.70
8/31/96 19361.60 15129.60
9/30/96 19553.30 15033.30
10/31/96 20088.40 15292.80
11/30/96 20152.90 14905.90
12/31/96 20636.00 14691.40
1/31/97 20892.90 14986.40
2/28/97 20584.60 14800.10
3/31/97 20286.50 14599.20
4/30/97 21170.40 15460.10
5/31/97 21807.50 15852.60
6/30/97 21951.10 15699.60
7/31/97 20788.10 15012.50
8/31/97 21660.30 15252.50
9/30/97 20487.00 14513.10
10/31/97 20268.90 13840.70
11/30/97 20190.30 13552.80
12/31/97 20475.70 13978.20
1/31/98 22122.60 15035.10
2/28/98 23857.20 15762.10
3/31/98 24351.30 15889.60
4/30/98 24768.50 16024.60
5/31/98 24334.70 15459.90
6/30/98 24491.40 15362.20
7/31/98 21368.40 13343.30
8/31/98 20428.20 13047.60
9/30/98 21111.00 13946.60
10/31/98 22308.70 14427.10
11/30/98 23304.90 14732.80
12/31/98 23842.20 14630.10
1/31/99 23125.80 14356.00
2/28/99 23573.50 14978.00
3/31/99 24983.90 15891.60
4/30/99 25140.60 15500.90
5/31/99 27222.30 16103.90
6/30/99 28190.90 16623.50
7/31/99 29001.80 16916.00
8/31/99 29486.10 16839.10
9/30/99 30758.80 16685.50
10/31/99 35365.30 17285.70
11/30/99 41761.10 18462.30
12/31/99 41607.50 18110.40
1/31/00 48297.80 18807.10
2/29/00 46808.40 18890.60
3/31/00 41359.30 17650.20
4/30/00 38286.00 17281.10
5/31/00 40170.90 18330.80
6/30/00 39669.10 17723.40
7/31/00 40562.60 18230.90
8/31/00 38494.10 17294.80
9/30/00 35630.00 16248.40
10/31/00 32730.10 15532.40
11/30/00 33402.30 16139.40
12/31/00 34914.90 16439.90
1/31/01 32408.00 15801.20
2/28/01 29284.80 14577.40
3/31/01 30419.20 15531.50
4/30/01 30223.20 15500.30
5/31/01 28746.50 14974.40
6/30/01 27590.90 14535.30
7/31/01 27034.60 14495.40
8/31/01 23353.90 12608.10
9/30/01 24466.60 13120.40
10/31/01 25850.50 13659.80
11/30/01 26349.80 13772.30
12/31/01 25707.80 13522.90
1/31/02 25636.50 13749.30
2/28/02 26977.50 14645.10
3/31/02 27862.00 14950.10
4/30/02 27747.90 15428.50
5/31/02 26646.10 14826.70
6/30/02 23854.00 13559.50
7/31/02 23496.10 13478.20
8/31/02 21405.60 12234.10
9/30/02 21491.50 12510.60
10/31/02 22150.20 12978.10
11/30/02 22107.40 12823.60
12/31/02 21561.90 12608.10
1/31/03 20987.70 12383.20
2/28/03 20686.20 12262.50
3/31/03 22566.80 13418.60
4/30/03 24433.00 14562.40
5/31/03 25133.50 15105.90
6/30/03 25681.50 15644.00
7/31/03 26835.00 16392.10
8/31/03 27844.40 17141.50
9/30/03 29978.50 18388.40
10/31/03 30800.50 18723.10
11/30/03 32675.00 19879.20
12/31/03 33641.10 20593.40
1/31/04 34910.10 21303.60
2/28/04 34924.50 21825.40
3/31/04 34174.70 21092.20
4/30/04 34290.00 21094.90
5/31/04 35543.50 21772.50
6/30/04 35543.00 21773.00
COLUMBIA ACORN INTERNATIONAL TOP 10 HOLDINGS (AS A % OF NET ASSETS)
1. Anglo Irish Bank (Ireland) 2.1%
SMALL BUSINESS & MIDDLE MARKET BANKING
2. Rhoen-Klinikum (Germany) 1.9%
HOSPITAL MANAGEMENT
3. Neopost (France) 1.5%
POSTAGE METERS
4. Exel (United Kingdom) 1.4%
GLOBAL LOGISTICS & FREIGHT FORWARDING
5. Kerry Group (Ireland) 1.3%
FOOD INGREDIENTS
6. Grafton Group (Ireland) 1.3%
BUILDERS, WHOLESALERS & DIY RETAILING
7. Talisman Energy (Canada) 1.3%
OIL & GAS PRODUCER
8. Tullow Oil (United Kingdom) 1.2%
OIL & GAS PRODUCER
9. Venture (Singapore) 1.2%
ELECTRONIC CONTRACT MANUFACTURER
10.Daito Trust Construction (Japan) 1.1%
APARTMENT BUILDER
The Fund's top 10 holdings and portfolio diversification vary with changes in
portfolio investments. See the Statement of Investments for a complete list of
the Fund's holdings.
9
COLUMBIA ACORN USA
>IN A NUTSHELL
[Photo of Robert A. Mohn]
Columbia Acorn USA strongly outperformed in the second quarter, up 4.67%
vs. a 0.47% gain for the Russell 2000. The Fund was also ahead year-to-date as
of June 30, 2004, up 9.85% for the six months vs. a 6.76% gain for the Russell
2000.
Good calls in the energy and telecom sectors contributed to the Fund's
outperformance. Our energy analyst, Jason Selch, believed energy stock prices
were lagging behind increases in oil prices. We added to the Fund's energy
weighting at the beginning of the year and it paid off as the sector rallied in
the first half of 2004. Quicksilver, a company that does coal seam gas drilling
in the Midwest, was up more than 107% for the six months and 73% in the quarter.
Western Gas, another coal seam gas producer, was up 38% year-to-date and up 28%
for the quarter.
We believe the Fund's outperformance in telecom was a testament to Columbia
Wanger's niche stock-picking talent. While the telecom component of the Russell
2000 was the worst performing sector in the index (down 2% for the quarter), our
telecom portion in Columbia Acorn USA was up 17%. We mentioned the growth of
Western Wireless and Crown Castle International in our first quarter report.
Both stocks showed continued strength in the second quarter. Western Wireless
was up 24% in the quarter and had a six-month gain of over 57%. Crown Castle was
up 17% for the quarter and 34% year-to-date. Regional phone company Commonwealth
Telephone was another telecom winner. The stock was up 9% for the quarter and
19% year-to-date.
Health care hurt performance. PPO network First Health was down 29% for the
second quarter and off 20% year-to-date. Competitor pricing pressure dampened
first quarter revenues. The company continued to generate a lot of cash--cash
they have been using to buy back stock. We believe they are doing the right
things in a tough environment. Par Pharmaceuticals, a generic drug manufacturer
recently added to the Fund, missed its first quarter earnings and suffered from
investor fears that the generics industry is becoming too competitive. We bought
the stock because we like the way the company is run and expect recent R&D
investments to begin paying off in 2005. Another new addition, Atherogenics, is
developing a promising product to treat cardiovascular disease but investors
fear unknowns that could come out in data to be released in the third quarter.
We are willing to accept the risk if the payoff is high enough. In this case, we
believe it could be.
We have been tweaking our stock emphasis to try and capture market
opportunities. In the financial sector, for example, we have shifted into banks
that we believe may benefit if short rates rise. We're also trying to focus more
on commercial banks over retail banks. In the health care sector, we believe
there are opportunities in select companies that have not participated in the
recent bull market. Short-term problems are making the outlook for these
companies somewhat unclear but the fog could be masking sunny days ahead.
/s/ Robert A. Mohn
Robert A. Mohn
LEAD PORTFOLIO MANAGER
ESCO'S TRIPLE PLAY
- --------------------------------------------------------------------------------
Esco Technologies manufactures filtration, communications and radio frequency
shielding/testing equipment. Filtration is an attractive "razor blade" industry.
Filters ("blades") generate higher profits than the original equipment
("razors") and generally have to be replaced on a regular basis, providing a
predictable revenue stream. The communications segment's largest and highest
growth product is its two-way automatic communications system. This system
enables utilities to remotely read meters by transmitting data over existing
electrical power lines and also allows for electrical grid load monitoring and
control. The radio frequency shielding segment of Esco's business makes products
that measure or contain electromagnetic emissions. This segment serves the
health care, electronics and transportation industries and has a leading share
of the market. For the first half of 2004, Esco's stock was up 22%. We like the
company's long-term prospects given its future growth potential, strong cash
flow, solid balance sheet and reasonable valuation.
INVESTMENTS IN SMALL-CAP COMPANIES MAY BE SUBJECT TO GREATER VOLATILITY AND
PRICE FLUCTUATIONS BECAUSE THEY MAY BE THINLY TRADED AND LESS LIQUID THAN
INVESTMENTS IN LARGER COMPANIES.
AS OF 6/30/04, THE FUND'S POSITIONS IN THE HOLDINGS MENTIONED WERE: QUICKSILVER,
2.7%; WESTERN GAS, 1.2%; WESTERN WIRELESS, 3.5%; CROWN CASTLE INTERNATIONAL,
1.9%; COMMONWEALTH TELEPHONE, 1.9%; FIRST HEALTH, 1.5%; PAR PHARMACEUTICALS,
0.9%; ATHEROGENICS, 0.6%; ESCO TECHNOLOGIES, 2.0%.
1-800-922-6769
10
COLUMBIA ACORN USA
>AT A GLANCE TICKER SYMBOL: AUSAX
PRETAX AND AFTER-TAX AVERAGE ANNUAL TOTAL RETURNS (CLASS Z)
>through June 30, 2004
YEAR LIFE OF
TO DATE* 1 YEAR 5 YEARS FUND
-------- ------ ------- -------
Returns before taxes 9.85% 34.66% 10.20% 14.42%
Returns after taxes 9.85 34.66 9.65 13.67
on distributions
Returns after taxes 6.40 22.53 8.62 12.46
on distributions and
sale of fund shares
Russell 2000 (pretax) 6.76 33.37 6.63 8.97
Past performance, before and after taxes, cannot predict future investment
results. After-tax returns are calculated using the highest historical
individual federal marginal income tax rates, and do not reflect the impact of
state and local taxes. Returns after taxes on distributions and sale of fund
shares reflect the additional tax impact of long-term gains or losses realized
when fund shares are sold. The returns are taxed at the maximum rate and assume
shares were purchased at the beginning of the period. Actual after-tax returns
depend on the investor's tax situation and may differ from those shown.
After-tax returns are not relevant to investors who hold their fund shares
through tax-deferred arrangements such as 401(k) plans or individual retirement
accounts. After-tax returns are shown for class Z shares only; after-tax returns
for other share classes will vary. Indexes do not reflect any deduction for
fees, expenses or taxes.
Investment returns and principal value may fluctuate, resulting in a gain or
loss on sale.
*Year to date data not annualized.
COLUMBIA ACORN USA PORTFOLIO DIVERSIFICATION
>as a % of net assets, as of June 30, 2004
[PIE CHART]
Consumer Goods/Services 15.4%
Health Care 15.1%
Other* 8.8%
Energy/Minerals 10.3%
Finance 9.8%
Industrial Goods/Services 6.7%
Information 33.9%
Software/Services 14.8%
Telecommunications 9.1%
Computer Related Hardware 6.7%
Media 3.3%
*Other includes cash and other assets less liabilities of 8.0%.
THE VALUE OF A $10,000 INVESTMENT IN COLUMBIA ACORN USA (CLASS Z)
>September 4, 1996 through June 30, 2004
This graph compares the results of $10,000 invested in Columbia Acorn USA at
inception on September 4, 1996 to the Russell 2000 Index, a market-weighted
index of 2,000 smaller U.S. companies formed by taking the largest 3,000 U.S.
companies and eliminating the largest 1,000. The index is unmanaged and returns
for both the index and the Fund include reinvested dividends and capital gains.
It is not possible to invest directly in an index. The graph and table do not
reflect tax deductions that a shareholder would pay on Fund distributions or the
sale of Fund shares.
PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND
PRINCIPAL VALUE OF AN INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT FUND SHARES,
WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. PERFORMANCE
CHANGES OVER TIME. VISIT COLUMBIAFUNDS.COM FOR DAILY UPDATES.
COLUMBIA ACORN USA NAV ON 6/30/04: $23.08
TOTAL NET ASSETS: $767.9 MILLION
[MOUNTAIN CHART]
AVERAGE ANNUAL TOTAL RETURN
----------------------------------
1 YEAR 5 YEARS LIFE OF FUND
34.66% 10.20% 14.42%
COLUMBIA
ACORN USA RUSSELL 2000
--------- ------------
09/04/96 10720.00 10359.90
09/30/96 10810.00 10200.20
10/31/96 11260.00 10620.50
11/30/96 11650.00 10898.90
12/31/96 12210.00 11116.70
01/31/97 11920.00 10847.10
02/28/97 11480.00 10335.30
03/31/97 11420.00 10364.10
04/30/97 12510.00 11517.10
05/31/97 13320.00 12010.70
06/30/97 14000.00 12569.60
07/31/97 14350.00 12857.20
08/31/97 15340.00 13798.30
09/30/97 15140.00 13192.10
10/31/97 15170.00 13106.80
11/30/97 15413.10 13336.20
12/31/97 15076.70 13125.70
01/31/98 16320.40 14096.30
02/28/98 17400.90 14677.70
03/31/98 17992.10 14758.80
04/30/98 17227.60 13964.00
05/31/98 17525.00 13993.40
06/30/98 16591.90 12860.50
07/31/98 13936.00 10363.30
08/31/98 14151.30 11174.30
09/30/98 14653.80 11630.10
10/31/98 15402.40 12239.40
11/30/98 16305.10 12996.70
12/31/98 15776.20 13169.40
01/31/99 14894.90 12102.80
02/28/99 15016.10 12291.70
03/31/99 16095.70 13393.20
04/30/99 16734.70 13588.80
05/31/99 17650.20 14203.30
06/30/99 18047.90 13813.60
07/31/99 16821.80 13302.30
08/31/99 16866.00 13305.20
09/30/99 17860.10 13359.10
10/31/99 18810.00 14156.80
11/30/99 20059.00 15759.40
12/31/99 19053.10 15506.30
01/31/00 19867.40 18066.90
02/29/00 19819.50 16875.80
03/31/00 17568.10 15860.30
04/30/00 16526.20 14935.90
05/31/00 16834.00 16237.90
06/30/00 16748.30 15715.40
07/31/00 17765.20 16914.50
08/31/00 17642.60 16417.40
09/30/00 17654.90 15684.50
10/31/00 16625.70 14074.50
11/30/00 18255.20 15283.30
12/31/00 19406.90 16079.00
01/31/01 19370.10 15023.90
02/28/01 18904.60 14289.00
03/31/01 21195.70 15406.90
04/30/01 22384.10 15785.60
05/31/01 23008.90 16330.60
06/30/01 23254.00 15446.70
07/31/01 22616.90 14947.80
08/31/01 19345.60 12935.60
09/30/01 19394.60 13692.60
10/31/01 20546.30 14752.60
11/30/01 21770.20 15663.20
12/31/01 22031.20 15500.30
01/31/02 21285.60 15075.50
02/28/02 23099.80 16287.10
03/31/02 23447.70 16435.60
04/30/02 22130.60 15706.10
05/31/02 20801.00 14926.80
06/30/02 17967.90 12672.40
07/31/02 17706.90 12640.10
08/31/02 16389.80 11732.40
09/30/02 17172.60 12108.60
10/31/02 18663.70 13189.20
11/30/02 17744.20 12454.80
12/31/02 17483.30 12110.10
01/31/03 17247.20 11744.20
02/28/03 17284.50 11895.40
03/31/03 18974.40 13023.30
04/30/03 20962.50 14420.90
05/31/03 21298.00 14681.90
06/30/03 22304.50 15600.50
07/31/03 23534.70 16315.80
08/31/03 22988.00 16014.60
09/30/03 25348.90 17359.50
10/31/03 25908.10 17975.50
11/30/03 26106.90 18340.20
12/31/03 27461.30 19137.00
01/31/04 27585.60 19308.60
02/28/04 27399.20 19488.50
03/31/04 26728.20 18494.90
04/30/04 27796.80 18789.30
05/31/04 28679.00 19580.60
06/30/04 28679.00 19581.00
COLUMBIA ACORN USA TOP 10 HOLDINGS (AS A % OF NET ASSETS)
1. Western Wireless 3.5%
RURAL CELLULAR PHONE SERVICES
2. AmeriCredit 2.8%
AUTO LENDING
3. Quicksilver 2.7%
NATURAL GAS & COAL SEAM GAS PRODUCER
4. Edwards Lifesciences 2.6%
HEART VALVES
5. ITT Educational Services 2.0%
TECHNOLOGY-ORIENTED POST SECONDARY DEGREE PROGRAMS
6. Esco Technologies 2.0%
FILTRATION & TEST EQUIPMENT
7. Commonwealth Telephone 1.9%
RURAL PHONE FRANCHISES & CLEC
8. Crown Castle International 1.9%
COMMUNICATION TOWERS IN USA & UK
9. Zebra Technologies 1.9%
BAR CODE PRINTERS
10. HCC Insurance Holdings 1.9%
AVIATION INSURANCE
The Fund's top 10 holdings and portfolio diversification vary with changes in
portfolio investments. See the Statement of Investments for a complete list of
the Fund's holdings.
11
COLUMBIA ACORN INTERNATIONAL SELECT
>IN A NUTSHELL
[Photo of Todd M. Narter] [Photo of Christopher J. Olson]
Columbia Acorn International Select rose 0.70% in the second quarter. By
comparison, the Citigroup World ex-US Cap Range $2-10B Index was down 1.23%. In
the first half of the year, the Fund was up 7.68%, outperforming the Citigroup
World ex-US Cap Range $2-10B Index return of 7.29%.
Big dollar winners for the quarter included Neopost, a French company that
makes postage meters. The company was up 10% for the quarter and 18% for the
half on solid results and continued growth. Talisman Energy, a Canadian oil and
gas producer, was up 11% in the quarter and 15% for the six months due to higher
oil prices and subsequent improvements in margins and profitability. Japan's
Hoya, a maker of eyeglass lenses and opto-electrical components, finished the
quarter up 8% and up 16% for the half.
Jardine Lloyd Thompson Group in the United Kingdom was the Fund's biggest
dollar loser this quarter. The company is an insurance broker offering marine,
aviation, property and casualty insurance. Shares dropped 20% in the quarter due
to the weaker dollar and the softer market for reinsurance this year. For the
six months, shares are down over 20%. Despite the recent weakness in the stock
price, management has continued to deliver good growth. With more than a 5%
dividend yield, attractive valuation and strong management, we feel that the
recent weakness may be overdone.
Other laggards to performance included Venture, an electronic manufacturing
services provider in Singapore, down 7% for the quarter and 9% for the six
months. Sinotrans, a Chinese logistics provider, was down 12% in the quarter and
24% for the half year. USS Co., a Japanese used car auctioneer, was down 9% for
the quarter but shares were up 7% for the six months. We sold the Fund's
positions in both Sinotrans and USS Co. during the quarter.
/s/ Todd M. Narter /s/ Christopher J. Olson
Todd M. Narter Christopher J. Olson
CO-PORTFOLIO MANAGER CO-PORTFOLIO MANAGER
A BRAND YOU'VE NEVER
- --------------------------------------------------------------------------------
HEARD OF
Funai Electric is a top-notch Japanese consumer electronics company and most
people do not know that it owns such recognizable brands as Sylvania, Emerson
and Symphonic. Funai Electric is a low-cost producer and has risen near the top
in all of its major product lines. Globally it is the fourth largest maker of
DVD players, second largest maker of VCR machines and the third largest maker of
TV sets. Funai Electric has the best operating margins of any consumer
electronics company in Japan but trades at a discount to its closest peers since
its name is not well known. We believe the market is bound to take notice and we
are hopeful that share price increases will follow. For the six months, the
shares were up 8%.
MID-CAP STOCKS TEND TO BE MORE VOLATILE AND MAY BE LESS LIQUID THAN THE STOCKS
OF LARGER COMPANIES. INVESTMENTS IN FOREIGN SECURITIES HAVE SPECIAL RISKS,
INCLUDING POLITICAL OR ECONOMIC INSTABILITY, HIGHER COSTS, DIFFERENT
REGULATIONS, ACCOUNTING STANDARDS, TRADING PRACTICES AND LEVELS OF INFORMATION,
AND CURRENCY EXCHANGE RATE FLUCTUATIONS.
AS OF 6/30/04, THE FUND'S POSITIONS IN THE HOLDINGS MENTIONED WERE: NEOPOST,
3.3%; TALISMAN ENERGY, 2.5%; HOYA, 2.9%; JARDINE LLOYD THOMPSON GROUP, 1.7%;
VENTURE, 2.0%; SINOTRANS, 0.0%; USS CO., 0.0%; FUNAI ELECTRIC, 3.3%.
1-800-922-6769
12
COLUMBIA ACORN INTERNATIONAL SELECT:
>AT A GLANCE TICKER SYMBOL: ACFFX
PRETAX AND AFTER-TAX AVERAGE ANNUAL TOTAL RETURNS (CLASS Z)
>through June 30, 2004
YEAR LIFE OF
TO DATE* 1 YEAR 5 YEARS FUND
-------- ------ ------- ----
Returns before taxes 7.68% 38.45% 4.01% 8.70%
Returns after taxes 7.51 38.41 3.91 8.59
on distributions
Returns after taxes 4.99 25.16 3.41 7.54
on distributions and
sale of fund shares
Citigroup World 7.29 42.32 6.19 7.23
ex-US Cap Range
$2-10B (pretax)
Past performance, before and after taxes, cannot predict future investment
results. After-tax returns are calculated using the highest historical
individual federal marginal income tax rates, and do not reflect the impact of
state and local taxes. Returns after taxes on distributions and sale of fund
shares reflect the additional tax impact of long-term gains or losses realized
when fund shares are sold. The returns are taxed at the maximum rate and assume
shares were purchased at the beginning of the period. Actual after-tax returns
depend on the investor's tax situation and may differ from those shown.
After-tax returns are not relevant to investors who hold their fund shares
through tax-deferred arrangements such as 401(k) plans or individual retirement
accounts. After-tax returns are shown for class Z shares only; after-tax returns
for other share classes will vary. The return after taxes on distributions may
be higher than the return before taxes due to qualified foreign tax credits.
Indexes do not reflect any deduction for fees, expenses or taxes.
Investment returns and principal value may fluctuate, resulting in a gain or
loss on sale.
*Year to date data not annualized.
COLUMBIA ACORN INTERNATIONAL SELECT PORTFOLIO DIVERSIFICATION
>as a % of net assets, as of June 30, 2004
[PIE CHART]
Consumer Goods/Services 24.0%
Finance 16.6%
Other* 4.8%
Information Technology 10.3%
Energy/Minerals 9.2%
Health Care 7.6%
Industrial 27.5%
Goods/Services
*Other includes cash and other assets less liabilities of 3.2%
THE VALUE OF A $10,000 INVESTMENT IN COLUMBIA ACORN INTERNATIONAL SELECT
(CLASS Z)
>November 23, 1998 through June 30, 2004
This graph compares the results of $10,000 invested in Columbia Acorn
International Select at inception on November 23, 1998 to the Citigroup World
ex-US Cap Range $2-10B Index, a subset of Citigroup's Broad Market Index,
representing a mid-cap developed market index excluding the U.S. The index and
Fund returns include reinvested dividends and capital gains. It is not possible
to invest directly in an index. The graph and table do not reflect tax
deductions that a shareholder would pay on Fund distributions or the sale of
Fund shares.
PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND
PRINCIPAL VALUE OF AN INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT FUND SHARES,
WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. PERFORMANCE
CHANGES OVER TIME. VISIT COLUMBIAFUNDS.COM FOR DAILY UPDATES.
COLUMBIA ACORN INTERNATIONAL SELECT NAV ON 6/30/04: $15.63
TOTAL NET ASSETS: $44.7 MILLION
[MOUNTAIN CHART]
AVERAGE ANNUAL TOTAL RETURN
------------------------------------
1 YEAR 5 YEARS LIFE OF FUND
38.45% 4.01% 8.70%
CITIGROUP WORLD
COLUMBIA ACORN EX-US CAP
INTERNATIONAL SELECT RANGE $2-10B
-------------------- ------------
11/23/98 10000 10000
11/30/98 10140 10045
12/31/98 11000 10339
1/31/99 11790 10310
2/28/99 11590 10052
3/31/99 11980 10449
4/30/99 12240 11032
5/31/99 12170 10567
6/30/99 13110 10953
7/31/99 13511 11362
8/31/99 13771 11490
9/30/99 13621 11530
10/31/99 14132 11535
11/30/99 16999 11864
12/31/99 19975 12772
1/31/00 19665 12154
2/29/00 24245 12311
3/31/00 23093 12680
4/30/00 21258 12172
5/31/00 18923 11976
6/30/00 19853 12611
7/31/00 19469 12203
8/31/00 20266 12586
9/30/00 19237 12168
10/31/00 18480 11791
11/30/00 16128 11440
12/31/00 17309 11998
1/31/01 17874 11939
2/28/01 15826 11505
3/31/01 13706 10607
4/30/01 14413 11391
5/31/01 14382 11293
6/30/01 13763 10999
7/31/01 13062 10723
8/31/01 12778 10626
9/30/01 10625 9392
10/31/01 11305 9769
11/30/01 11925 10118
12/31/01 12280 10140
1/31/02 11650 9841
2/28/02 11508 9991
3/31/02 11915 10562
4/30/02 12290 10756
5/31/02 12433 11097
6/30/02 12047 10712
7/31/02 10746 9753
8/31/02 10950 9730
9/30/02 10147 8859
10/31/02 10127 9017
11/30/02 10381 9476
12/31/02 10452 9209
1/31/03 9944 8978
2/28/03 9528 8810
3/31/03 9629 8660
4/30/03 10533 9425
5/31/03 11447 10101
6/30/03 11527 10389
7/31/03 11710 10806
8/31/03 12218 11429
9/30/03 12675 11900
10/31/03 13621 12819
11/30/03 13905 12927
12/31/03 14820 13781
1/31/04 15094 14071
2/28/04 15745 14410
3/31/04 15847 14970
4/30/04 15532 14460
5/31/04 15552 14420
6/30/04 15958 14786
COLUMBIA ACORN INTERNATIONAL SELECT TOP 10 HOLDINGS (AS A % OF NET ASSETS)
1. Anglo Irish Bank (Ireland) 5.7%
SMALL BUSINESS & MIDDLE MARKET BANKING
2. Exel (United Kingdom) 4.2%
GLOBAL LOGISTICS & FREIGHT FORWARDING
3. BG Group (United Kingdom) 3.7%
OIL & GAS PRODUCER
4. Neopost (France) 3.3%
POSTAGE METERS
5. Funai Electric (Japan) 3.3%
CONSUMER ELECTRONICS
6. Daito Trust Construction (Japan) 3.3%
APARTMENT BUILDER
7. Den Norske Bank (Norway) 3.2%
LARGEST NORWEGIAN BANK
8. Komercni Banka (Czech Republic) 3.0%
LEADING CZECH UNIVERSAL BANK
9. Sugi Pharmacy (Japan) 3.0%
DRUGSTORES
10. Hoya (Japan) 2.9%
OPTO-ELECTRICAL COMPONENTS & EYEGLASS LENSES
The Fund's top 10 holdings and portfolio diversification vary with changes in
portfolio investments. See the Statement of Investments for a complete list of
the Fund's holdings.
13
COLUMBIA ACORN SELECT
>IN A NUTSHELL
[Photo of Ben Andrews]
Columbia Acorn Select increased 1.93% for the quarter, outperforming the
S&P MidCap 400's 0.97% gain and the S&P 500's 1.72% return. Year-to-date through
June 30, 2004, Columbia Acorn Select is up 7.42% vs. a 6.08% gain for the S&P
MidCap 400 and a 3.44% gain for the S&P 500.
The quarter's winners included Expeditors International, Safeway and ITT
Educational Services, all up between 22% and 25%. Each of these companies
reported strong first quarter results and we are bullish on future outlooks.
Year-to-date through June 30, the Fund's performance drivers were
Harley-Davidson, ITT Educational Services, and Abercrombie and Fitch, which were
each up between 31% to 60% and added a combined $35 million profit to the Fund's
portfolio.
The biggest loser during the quarter and the six months was First Health.
Weak demand for the company's managed-care programs, coupled with enhanced
nationwide PPO offerings by many of its competitors, sent the stock down 20% in
the first half of the year. We believe that First Health's network and new
program offerings have a competitive advantage and should help the company gain
share in the corporate market.
We added two new names to the Fund's portfolio during the quarter:
Skillsoft Publishing, an Internet-delivered software training company, and
Tellabs, a manufacturer of telecom hardware. During the last three years of
dismal telecom capital spending, Tellabs made inroads into new markets, such as
data switching and fiber to residential users, while preserving its dominant
market share in digital transport. We believe that cable and telephone companies
worldwide will push to offer value-added services to their customers and Tellabs
will be a beneficiary.
As your new portfolio manager (as of March 11, 2004), I would like to
assure you that my sole focus is to continue to deliver competitive performance.
I am backed by the same analyst team, following the same investment process, to
pursue the same investment objective, as the previous manager. This investment
process has existed within Columbia Acorn's family for more than three decades
and I intend to honor the process.
/s/ Ben Andrews
Ben Andrews
LEAD PORTFOLIO MANAGER
FRESHENING THE BUSINESS
- --------------------------------------------------------------------------------
Once a darling of Wall Street, grocery retailer Safeway has fallen from grace.
The culprits: botched acquisitions, elevated labor and health care costs and
increased competition. These factors have reduced the company's stock price by
65% from its early 2001 peak, but there just might be light at the end of the
tunnel. Management has begun to clean up the company's acquisitions. Two-tier
wage contracts in many of its markets and workers compensation reforms in
California will improve labor expenses over time. Marketing programs touting the
stores' freshness and quality are starting to improve store sales. In time, we
believe these results should improve sales and margins, which could lead to an
increase in Safeway's stock price.
COLUMBIA ACORN SELECT IS A NON-DIVERSIFIED FUND. THE PERFORMANCE OF EACH OF ITS
HOLDINGS WILL HAVE A GREATER IMPACT ON THE FUND'S TOTAL RETURN, AND MAY MAKE THE
FUND'S RETURNS MORE VOLATILE THAN A MORE DIVERSIFIED FUND. MID-CAP STOCKS TEND
TO BE MORE VOLATILE AND MAY BE LESS LIQUID THAN THE STOCKS OF LARGER COMPANIES.
AS OF 6/30/04, THE FUND'S POSITIONS IN THE HOLDINGS MENTIONED WERE: EXPEDITORS
INTERNATIONAL, 3.1%; SAFEWAY, 3.8%; HARLEY-DAVIDSON, 6.3%; ITT EDUCATIONAL
SERVICES, 4.8%; ABERCROMBIE AND FITCH, 3.4%; FIRST HEALTH, 4.3%; SKILLSOFT
PUBLISHING, 1.6%; TELLABS, 3.0%.
1-800-922-6769
14
COLUMBIA ACORN SELECT
>AT A GLANCE TICKER SYMBOL: ACTWX
PRETAX AND AFTER-TAX AVERAGE ANNUAL TOTAL RETURNS (CLASS Z)
>through June 30, 2004
YEAR LIFE
TO DATE* 1 YEAR 5 YEARS OF FUND
-------- ------ ------- -------
Returns before taxes 7.42% 20.40% 10.62% 14.74%
Returns after taxes 7.42 20.24 10.06 14.22
on distributions
Returns after taxes on 4.82 13.39 8.95 12.72
distributions and sale
of fund shares
S&P MidCap 400 6.08 27.98 9.05 11.40
(pretax)
Past performance, before and after taxes, cannot predict future investment
results. After-tax returns are calculated using the highest historical
individual federal marginal income tax rates, and do not reflect the impact of
state and local taxes. Returns after taxes on distributions and sale of fund
shares reflect the additional tax impact of long-term gains or losses realized
when fund shares are sold. The returns are taxed at the maximum rate and assume
shares were purchased at the beginning of the period. Actual after-tax returns
depend on the investor's tax situation and may differ from those shown.
After-tax returns are not relevant to investors who hold their fund shares
through tax-deferred arrangements such as 401(k) plans or individual retirement
accounts. After-tax returns are shown for class Z shares only; after-tax returns
for other share classes will vary. Indexes do not reflect any deduction for
fees, expenses or taxes.
Investment returns and principal value may fluctuate, resulting in a gain or
loss on sale.
*Year to date data not annualized.
COLUMBIA ACORN SELECT PORTFOLIO DIVERSIFICATION
>as a % of net assets, as of June 30, 2004
[PIE CHART]
Consumer Goods/Services 32.8%
Finance 13.5%
Health Care 7.1%
Industrial Goods/Services 3.1%
Other* 9.5%
Information 34.0%
*Cash and other assets less liabilities.
THE VALUE OF A $10,000 INVESTMENT IN COLUMBIA ACORN SELECT (CLASS Z)
>November 23, 1998 through June 30, 2004
This graph compares the results of $10,000 invested in Columbia Acorn Select at
inception on November 23, 1998 to the S&P MidCap 400, a broad, market-weighted
index of 400 stocks that are in the next size/tier down from the S&P 500. The
Index is unmanaged and returns for both the index and the Fund include
reinvested dividends and capital gains. It is not possible to invest directly in
an index. The graph and table do not reflect tax deductions that a shareholder
would pay on Fund distributions or the sale of Fund shares.
PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND
PRINCIPAL VALUE OF AN INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT FUND SHARES,
WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. PERFORMANCE
CHANGES OVER TIME. VISIT COLUMBIAFUNDS.COM FOR DAILY UPDATES.
COLUMBIA ACORN SELECT NAV ON 6/30/04: $19.55
TOTAL NET ASSETS: $989.0 MILLION
[MOUNTAIN CHART]
AVERAGE ANNUAL TOTAL RETURN
------------------------------------
1 YEAR 5 YEARS LIFE OF FUND
20.04% 10.62% 14.74%
COLUMBIA S&P
ACORN SELECT MIDCAP 400
------------ ----------
11/23/98 10030.00 9911.29
11/30/98 10710.00 11108.90
12/31/98 11000.00 10676.20
01/31/99 10710.00 10117.20
02/28/99 11480.00 10399.90
03/31/99 12710.00 11220.20
04/30/99 12730.00 11268.80
05/31/99 13040.00 11872.20
06/30/99 13190.00 11619.90
07/31/99 12060.00 11221.70
08/31/99 12110.00 10875.10
09/30/99 12970.00 11429.30
10/31/99 13250.00 12029.20
11/30/99 13848.00 12744.10
12/31/99 13474.00 12385.20
01/31/00 13554.90 13252.00
02/29/00 14171.50 14361.10
03/31/00 13463.90 13859.60
04/30/00 13100.00 13686.70
05/31/00 14319.80 13887.70
06/30/00 13931.30 14107.10
07/31/00 15431.30 15682.20
08/31/00 15798.20 15574.80
09/30/00 15927.70 15046.70
10/31/00 14381.60 13910.90
11/30/00 15465.20 14975.10
12/31/00 15913.90 15308.60
01/31/01 14983.60 14435.00
02/28/01 14403.50 13361.80
03/31/01 15454.20 14835.80
04/30/01 16297.00 15181.30
05/31/01 16023.40 15120.00
06/30/01 15870.20 14894.80
07/31/01 15125.90 14407.60
08/31/01 14206.50 12615.50
09/30/01 14513.00 13173.50
10/31/01 16023.40 14153.50
11/30/01 16702.50 14884.70
12/31/01 16373.50 14807.30
01/31/02 16022.60 14825.60
02/28/02 16581.90 15885.40
03/31/02 15682.60 15811.10
04/30/02 16143.20 15544.40
05/31/02 15869.00 14406.70
06/30/02 14860.10 13011.20
07/31/02 15222.00 13076.60
08/31/02 14520.10 12023.10
09/30/02 15320.70 12544.10
10/31/02 16088.40 13269.80
11/30/02 15397.50 12724.50
12/31/02 15331.70 12352.70
01/31/03 15375.50 12058.50
02/28/03 15682.60 12160.10
03/31/03 16581.90 13043.00
04/30/03 17481.20 14123.90
05/31/03 17941.80 14303.90
06/30/03 18808.10 14811.50
07/31/03 19586.80 15483.30
08/31/03 19159.10 15246.30
09/30/03 19861.00 16399.10
10/31/03 19718.40 16970.50
11/30/03 20110.90 17256.80
12/31/03 20663.40 17630.80
01/31/04 21204.90 18054.20
02/28/04 21193.80 18130.80
03/31/04 20586.10 17535.70
04/30/04 20917.60 17899.40
05/31/04 21602.70 18306.80
06/30/04
COLUMBIA ACORN SELECT TOP 10 HOLDINGS (AS A % OF NET ASSETS)
1. Harley-Davidson 6.3%
MOTORCYCLES & RELATED MERCHANDISE
2. TCF Financial 5.8%
GREAT LAKES BANK
3. McAfee 5.0%
SECURITY SOFTWARE & SERVICES
4. ITT Educational Services 4.8%
TECHNOLOGY-ORIENTED POST SECONDARY DEGREE PROGRAMS
5. First Health 4.3%
PPO NETWORK
6. PeopleSoft 4.0%
HR, ERP, CRM & SUPPLY CHAIN SOFTWARE
7. Safeway 3.8%
RETAIL FOOD & DRUG STORES
8. Interpublic Group 3.8%
ADVERTISING
9. Synopsys 3.7%
SOFTWARE FOR DESIGNING SEMICONDUCTOR CHIPS
10. Tektronix 3.4%
ANALYTICAL INSTRUMENTS
The Fund's top 10 holdings and portfolio diversification vary with changes in
portfolio investments. See the Statement of Investments for a complete list of
the Fund's holdings.
15
COLUMBIA THERMOSTAT FUND
>IN A NUTSHELL
[Photo of Ralph Wanger] [PHOTO OF Charles P. McQuaid]
Columbia Thermostat Fund was down 0.18% for the quarter but ended the six
months up 2.74%. These returns were in line with the Lipper Flexible Portfolio
Funds Index. As expected, Fund performance was in between the S&P 500 and the
Lehman Brothers U.S. Credit Intermediate Bond Index (see Page 2 for index
results).
The first six months of 2004 favored our small-, mid-and value-stock funds
in the portfolio. Columbia Mid Cap Value Fund, Columbia Acorn Fund, and Columbia
Acorn Select were each up over 7.40% for the six-month period. Overall,
Thermostat's equity portfolio had a 4.61% return year-to-date and the fixed
income piece was up 0.17%.
RESULTS OF THE FUNDS OWNED IN COLUMBIA THERMOSTAT FUND
Equities
2ND SIX-MONTH
WEIGHTING QUARTER RETURNS TO
FUND IN FUND RETURNS 6/30/04
- ----------------------------------------------------------
Columbia 20% 1.65% 8.99%
Acorn Fund
- ----------------------------------------------------------
Columbia 15% 1.93% 7.42%
Acorn Select
- ----------------------------------------------------------
Columbia Growth 25% 1.01% -2.17%
Stock Fund
- ----------------------------------------------------------
Columbia Growth 25% 0.42% 4.26%
& Income Fund
- ----------------------------------------------------------
Columbia Mid Cap 15% 2.64% 7.86%
Value Fund
- ----------------------------------------------------------
WEIGHTED AVERAGE 100% 1.37% 4.61%*
- ----------------------------------------------------------
* WEIGHTED AVERAGE RETURN OF EQUITY FUNDS IN THE PORTFOLIO.
Fixed Income
2ND SIX-MONTH
WEIGHTING QUARTER RETURNS TO
FUND IN FUND RETURNS 6/30/04
- ----------------------------------------------------------
Columbia Federal 30% -2.37% 0.11%
Securities Fund
- ----------------------------------------------------------
Columbia Intermediate 50% -2.35% 0.14%
Bond Fund
- ----------------------------------------------------------
Columbia High 20% -1.91% 0.32%
Yield Fund
- ----------------------------------------------------------
WEIGHTED AVERAGE 100% -2.27%* 0.17%*
- ----------------------------------------------------------
* WEIGHTED AVERAGE RETURN FOR INCOME FUNDS IN THE PORTFOLIO.
COLUMBIA THERMOSTAT FUND
REBALANCING IN THE QUARTER
- ----------------------------------------------------------
APRIL 22, 2004: 50% stock, 50% fixed income
MAY 21, 2004: 55% stock, 45% fixed income
JUNE 23, 2004: 50% stock, 50% fixed income
During the second quarter, the equity portion of the portfolio had a 1.37% gain
vs. a 2.27% drop on the income side.
As noted in the table below, the Fund hit three reallocation triggers
during the second quarter. We increased bond exposure in the portfolio in April
and June and increased stock fund exposure in May.
Assets in Columbia Thermostat Fund were just over $183 million at the end
of the period. We believe this is a good result for a fund that is less than two
years old. We are pleased with the steady inflows of money and appreciate your
investment. We will continue to strive to keep Fund results at an even
temperature despite ongoing market volatility.
/s/ Ralph Wanger /s/ Charles P. McQuaid
Ralph Wanger Charles P. McQuaid
CO-PORTFOLIO MANAGER CO-PORTFOLIO MANAGER
THE VALUE OF AN INVESTMENT IN THE FUND IS BASED PRIMARILY ON THE PERFORMANCE OF
THE UNDERLYING PORTFOLIO FUNDS AND THE ALLOCATION OF THE FUND'S ASSETS AMONG
THEM. AN INVESTMENT IN THE UNDERLYING FUNDS MAY PRESENT CERTAIN RISKS, INCLUDING
STOCK MARKET FLUCTUATIONS THAT OCCUR IN RESPONSE TO ECONOMIC AND BUSINESS
DEVELOPMENTS; AND A GREATER DEGREE OF SOCIAL, POLITICAL AND ECONOMIC VOLATILITY
ASSOCIATED WITH INTERNATIONAL INVESTING. INVESTING IN SMALL-AND MID-CAP STOCKS
MAY PRESENT SPECIAL RISKS INCLUDING POSSIBLE ILLIQUIDITY AND GREATER PRICE
VOLATILITY THAN STOCKS OF LARGER, MORE ESTABLISHED COMPANIES. CHANGES IN
INTEREST RATES AND CHANGES IN THE FINANCIAL STRENGTH OF ISSUERS OF LOWER-RATED
BONDS MAY ALSO AFFECT UNDERLYING FUND PERFORMANCE. THE FUND IS ALSO SUBJECT TO
THE RISK THAT THE INVESTMENT ADVISER'S DECISIONS REGARDING ASSET CLASSES AND
PORTFOLIO FUNDS WILL NOT ANTICIPATE MARKET TRENDS SUCCESSFULLY, RESULTING IN A
FAILURE TO PRESERVE CAPITAL OR LOWER TOTAL RETURN. IN ADDITION, THE FUND MAY BUY
AND SELL SHARES OF THE PORTFOLIO FUNDS FREQUENTLY. THIS MAY RESULT IN HIGHER
TRANSACTION COSTS AND ADDITIONAL TAX LIABILITY. THIS IS NOT AN OFFER OF THE
SHARES OF ANY OTHER MUTUAL FUND MENTIONED HEREIN.
1-800-922-6769
16
COLUMBIA THERMOSTAT FUND
>AT A GLANCE TICKER SYMBOL: COTZX
PRETAX AND AFTER-TAX AVERAGE ANNUAL TOTAL RETURNS (CLASS Z)
>through June 30, 2004
YEAR TO LIFE OF
DATE* 1 YEAR FUND
------- ------ -------
Returns before taxes 2.74% 12.91% 15.08%
Returns after taxes 2.70 12.45 14.81
on distributions
Returns after taxes on distribu- 1.79 8.46 12.77
tions and sale of fund shares
S&P 500 (pretax) 3.44 19.11 22.82
Lehman U.S. Credit Intermediate -0.08 0.44 5.61
Bond Index (pretax)
Lehman U.S. Govt. Intermediate -0.15 -0.48 1.99
Bond Index (pretax)
Lipper Flexible Portfolio Funds 2.25 14.64 17.58
Index (pretax)
Past performance, before and after taxes, cannot predict future investment
results. After-tax returns are calculated using the highest historical
individual federal marginal income tax rates, and do not reflect the impact of
state and local taxes. Returns after taxes on distributions and sale of fund
shares reflect the additional tax impact of long-term gains or losses realized
when fund shares are sold. The returns are taxed at the maximum rate and assume
shares were purchased at the beginning of the period. Actual after-tax returns
depend on the investor's tax situation and may differ from those shown.
After-tax returns are not relevant to investors who hold their fund shares
through tax-deferred arrangements such as 401(k) plans or individual retirement
accounts. After-tax returns are shown for class Z shares only; after-tax returns
for other share classes will vary. Indexes do not reflect any deduction for
fees, expenses or taxes. Investment returns and principal value may fluctuate,
resulting in a gain or loss on sale.
*Year to date data not annualized.
PORTFOLIO WEIGHTINGS
>as a % of assets in each investment category, as of June 30, 2004
[PIE CHART]
STOCK MUTUAL FUNDS
Columbia Acorn Fund 20%
Columbia Acorn Select 15%
Columbia Growth Stock Fund 25%
Columbia Growth & Income Fund 25%
Columbia Mid Cap Value Fund 15%
BOND MUTUAL FUNDS
Columbia Federal Securities Fund 30%
Columbia Intermediate Bond Fund 50%
Columbia High Yield Fund 20%
THE VALUE OF A $10,000 INVESTMENT IN COLUMBIA THERMOSTAT FUND (CLASS Z)
>September 25, 2002 through June 30, 2004
This graph compares the results of $10,000 invested in Columbia Thermostat Fund
at inception on September 25, 2002 to three indexes. The S&P 500 is a broad,
market-weighted average of U.S. blue-chip company stock performance. The Lehman
U.S. Govt. Bond Index is comprised of 1 to 10 year treasury and agency bonds,
excluding targeted investor notes and state and local government series bonds.
The Lehman U.S. Credit Intermediate Bond Index is the intermediate component of
the U.S. Credit Index. The U.S. Credit Index includes publicly issued U.S.
corporate and foreign debentures and secured notes that meet specified maturity,
liquidity, and quality requirements. The Indexes are unmanaged and returns for
the indexes and the Fund include reinvested dividends and capital gains. It is
not possible to invest directly in an index. The graph and table do not reflect
tax deductions that a shareholder would pay on Fund distributions or the sale of
Fund shares.
PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND
PRINCIPAL VALUE OF AN INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT FUND SHARES,
WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. PERFORMANCE
CHANGES OVER TIME. VISIT COLUMBIAFUNDS.COM FOR DAILY UPDATES.
COLUMBIA THERMOSTAT FUND NAV ON 6/30/04: $12.63
TOTAL NET ASSETS: $183.4 MILLION
[MOUNTAIN CHART]
AVERAGE ANNUAL TOTAL RETURN
-------------------------------
1 YEAR LIFE OF FUND
12.91% 15.08%
COLUMBIA
THERMOSTAT LEHMAN U.S. CREDIT LEHMAN U.S. GOVT.
S&P 500 FUND INTERMEDIATE BOND INTERMEDIATE BOND
------- ----------- ----------------- -----------------
09/30/02 9955.60 9850.00 10042.80 10038.80
10/31/02 10831.90 10220.00 9962.13 10032.00
11/30/02 11469.40 10700.00 10044.60 9952.60
12/31/02 10795.60 10410.00 10306.80 10136.50
01/31/03 10512.80 10260.00 10335.10 10114.10
02/28/03 10355.10 10100.00 10517.50 10228.30
03/31/03 10455.60 10190.00 10539.30 10230.50
04/30/03 11316.80 10710.00 10683.90 10259.20
05/31/03 11913.10 11200.00 10956.80 10420.30
06/30/03 12065.10 11348.00 10962.70 10403.20
07/31/03 12277.80 11418.00 10626.40 10150.40
08/31/03 12517.20 11648.20 10658.60 10168.70
09/30/03 12384.30 11618.20 10976.00 10389.10
10/31/03 13084.90 12018.40 10878.30 10287.30
11/30/03 13200.00 12148.50 10911.20 10288.10
12/31/03 13892.30 12470.60 11019.40 10368.30
01/31/04 14147.30 12642.80 11108.10 10424.50
02/28/04 14343.90 12784.60 11231.20 10523.90
03/31/04 14127.50 12835.20 11330.60 10597.10
04/30/04 13905.70 12571.90 11041.40 10360.30
05/31/04 14096.60 12612.40 10971.40 10327.10
06/30/04 14370.70 12812.50 11021.30 10265.90
COLUMBIA THERMOSTAT FUND ASSET ALLOCATION
>as a % of net assets, as of June 30, 2004
[PIE CHART]
Stock Mutual Funds 49.7%
Bond Mutual Funds 49.8%
Cash and Other Assets Less Liabilities 0.5%
17
COLUMBIA ACORN FUND
>MAJOR PORTFOLIO CHANGES IN THE SECOND QUARTER (UNAUDITED)
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
ADDITIONS
- ----------------------------------------------------------------------------
INFORMATION
American Tower 1,500,000 1,750,000
ASE Test (Taiwan) 780,000 1,380,000
Autobytel 0 500,000
Bearing Point 3,100,000 3,350,000
Ceridian 0 1,000,000
Concurrent Computer 2,325,000 4,656,000
Crown Castle International 3,500,000 4,000,000
E.Piphany 5,700,000 6,700,000
Entravision Communications 301,000 1,000,000
Fair Isaac 0 530,000
Gestevis Telecino 0 75,000
Igate Capital 4,550,000 4,656,000
Insight Communications 1,700,000 2,700,000
Integrated Circuit Systems 1,195,000 1,315,000
Jabil Circuit 1,420,000 1,500,000
Liberty Media International 0 131,000
Novell 11,000,000 11,500,000
Pegasus Systems 1,125,000 1,250,000
Plexus 1,300,000 1,600,000
Radiant Systems 1,500,000 1,575,000
Semtech 800,000 850,000
SES Global (Luxembourg) 1,337,000 2,537,000
Shuffle Master 827,000 940,000
Tellabs 5,700,000 8,700,000
ValueClick 1,954,000 2,000,000
Venture (Singapore) 2,710,000 3,150,000
Western Wireless 2,800,000 3,000,000
- ----------------------------------------------------------------------------
CONSUMER GOODS/SERVICES
Alliance Gaming 2,010,000 2,750,000
Ann Taylor 795,000 863,000
(INCLUDES THE EFFECT OF A 3 FOR 2
STOCK SPLIT)
Brookstone 130,500 600,000
(INCLUDES THE EFFECT OF A 3 FOR 2
STOCK SPLIT)
Callaway Golf 0 500,000
Carter's 53,000 369,000
Columbia Sportswear 200,000 400,000
Global Bio-Chem Technology
Group (China) 14,730,000 30,000,000
Global Bio-Chem Technology
Group (Warrants) (China) 0 1,841,250
HNI 0 1,600,000
Masonite International (Canada) 440,000 550,000
Natura Cosmeticos (Brazil) 0 500,000
NBTY 0 850,000
Orbitz 0 750,000
Otsuke Kagu (Japan) 0 210,000
Pacific Brands (Australia) 0 5,000,000
Rank Group (United Kingdom) 0 230,700
RC2 425,000 545,000
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
- ----------------------------------------------------------------------------
CONSUMER GOODS/SERVICES (CONTINUED)
Sports Authority 0 773,000
Wacoal (Japan) 0 1,100,000
West Marine 0 823,000
Williams-Sonoma 607,000 1,400,000
- ----------------------------------------------------------------------------
INDUSTRIAL GOODS/SERVICES
Aalberts Industrie (Netherlands) 720,000 737,560
Aviall 300,000 600,000
Dominion Homes 0 290,000
Exel (United Kingdom) 1,800,000 2,600,000
Genlyte Group 0 300,000
Jaako Poyry (Finland) 0 185,000
Sika (Switzerland) 0 25,000
Tenaris (Argentina) 605,000 750,000
United Services Group
(Netherlands) 420,000 640,000
Vallourec (France) 66,000 95,000
Watts Water Technologies 543,000 554,000
Wienerberger (Austria) 700,000 787,500
- ----------------------------------------------------------------------------
FINANCE
Bank of the Ozarks 0 231,000
BOK Financial 1,524,000 1,638,000
CityBank Lynnwood 267,000 360,000
Credito Emiliano (Italy) 0 210,000
Cullen Frost Bankers 108,000 370,000
First Mutual Bancshares 76,000 125,000
Glacier Bancorp 1,917,500 2,187,000
(INCLUDES THE EFFECT OF A 5 FOR
4 STOCK SPLIT)
Great Southern Bancorp 348,000 455,000
(INCLUDES THE EFFECT OF A 2 FOR 1
STOCK SPLIT)
Imperial Thrift & Loan 0 74,000
Jardine Lloyd Thompson
(United Kingdom) 1,000,000 1,992,000
Komercni Banka (Czech Republic) 0 145,000
Northgate (United Kingdom) 0 784,000
Stewart Information Services 0 245,000
Texas Regional Bancshares 1,015,000 1,300,000
West Coast Bancorp 1,045,000 1,320,000
1-800-922-6769
18
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
ADDITIONS (CONTINUED)
- ----------------------------------------------------------------------------
HEALTH CARE
Accredo Health 0 450,000
Atherogenics 389,000 789,000
Bioveris 1,000,000 1,150,000
DOV Pharmaceuticals 0 1,165,000
Hogy Medical (Japan) 0 190,000
La Jolla Pharmaceutical 0 3,500,000
Lexicon Genetics 0 1,876,000
Ligand Pharmaceuticals 0 1,250,000
Myriad Genetics 160,000 460,000
Neurocrine Biosciences 0 360,000
NPS Pharmaceuticals 426,000 776,000
OPG Groep (Netherlands) 420,000 510,000
Par Pharmaceuticals 0 775,000
Pozen 0 1,709,000
- ----------------------------------------------------------------------------
ENERGY/MINERALS
Chicago Bridge & Iron 428,000 700,000
Clayton Williams Energy 0 400,000
Clayton Williams Energy -- 40,000
Esprit Exploration (Canada) 0 3,458,200
FMC Technologies 1,900,000 2,300,000
Fugro (Netherlands) 250,000 333,000
Gamesa (Spain) 570,000 1,470,000
McMoRan Exploration 875,000 915,000
Nexen (Canada) 800,000 925,000
Noranda (Canada) 500,000 700,000
Range Resources 0 916,000
Tullow Oil (United Kingdom) 10,000,000 15,400,000
Western Gas 2,600,000 2,800,000
(INCLUDES THE EFFECT OF A 2 FOR 1
STOCK SPLIT)
- ----------------------------------------------------------------------------
OTHER INDUSTRIES
Diamondrock Hospitality 0 1,000,000
Highland Hospitality 440,000 1,240,000
Northeast Utilities 1,350,000 1,650,000
Sponda (Finland) 875,000 1,352,600
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
SALES
- ----------------------------------------------------------------------------
INFORMATION
Agilysys 1,410,000 710,000
Alliance Atlantis Communication
(Canada) 750,000 500,000
American Management Systems 58,000 0
Aspect Communications 3,959,000 3,550,000
Avid Technology 1,800,000 1,600,000
Ciber 3,319,000 3,100,000
COMARCO 533,000 300,000
Commonwealth Telephone 900,000 800,000
Dionex 836,000 536,000
DoubleClick 2,000,000 1,400,000
Euronet Worldwide 406,000 286,000
Euronext (France) 725,000 0
Global Payments 1,487,000 1,457,000
Hit Entertainment
(United Kingdom) 2,750,000 0
International Game Technology 8,768,000 6,700,000
Kronos 1,900,000 1,625,000
Neopost (France) 431,900 371,900
Perot Systems 900,000 205,000
RH Donnelley 150,000 119,000
RSA Security 2,500,000 2,200,000
Salem Communications 850,000 770,000
Skillsoft Publishing 9,800,000 9,500,000
Tech Data 780,000 680,000
TVB (Hong Kong) 3,300,000 224,700
Varian 668,000 428,000
Witness Systems 1,660,000 1,500,000
- ----------------------------------------------------------------------------
CONSUMER GOODS/SERVICES
Borders Group 1,400,000 1,300,000
Furniture Brands International 510,000 0
Helen of Troy 2,200,000 1,381,000
Hon Industries 1,455,000 0
Jones Apparel 418,000 0
SCP Pool 1,511,000 1,326,000
Shimano (Japan) 800,000 644,100
USS (Japan) 260,000 135,000
Whole Foods Market 500,000 350,000
- ----------------------------------------------------------------------------
INDUSTRIAL GOODS/SERVICES
Expeditors International of
Washington 2,900,000 2,750,000
G&K Services 725,000 550,000
Hub Group 759,000 549,000
Insituform Technologies 500,000 0
Labor Ready 1,900,000 1,800,000
Munters (Sweden) 590,000 0
Northwest Pipe Company 120,000 0
19
COLUMBIA ACORN FUND
>MAJOR PORTFOLIO CHANGES IN THE SECOND QUARTER (UNAUDITED),
CONTINUED
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
SALES (CONTINUED)
- ----------------------------------------------------------------------------
FINANCE
Harleysville Group 200,000 0
Irish Life & Permanent (Ireland) 1,000,000 959,400
Republic 1,798,000 1,698,000
- ----------------------------------------------------------------------------
HEALTH CARE
Aclara Biosciences 1,982,000 0
Applera Celera Genomics 900,000 0
Enzon 1,665,000 0
Gene Logic 210,000 0
Guilford Pharmaceuticals 316,000 0
Incyte Genomics 320,000 0
Kinetic Concepts 276,000 0
Nektar Therapeutics 2,055,000 1,055,000
Novoste 1,273,000 0
Patheon (Canada) 422,000 0
Pharmacyclics 528,000 0
- ----------------------------------------------------------------------------
ENERGY/MINERALS
Aquila 1,270,000 0
Evergreen Resources 1,460,000 0
Quicksilver 600,000 465,000
Westport Resources 517,000 0
XTO Energy 7,875,000 7,275,000
- ----------------------------------------------------------------------------
OTHER INDUSTRIES
Airports of Thailand (Thailand) 1,250,600 0
Chelsea Properties Group 400,000 0
Federal Realty Investment Trust 690,000 575,000
General Growth Properties 1,845,000 1,320,000
LNR Property 80,000 0
Macerich Company 800,000 635,000
Mills 725,000 620,000
Red Electrica (Spain) 899,800 799,800
The Rouse Company 1,160,000 825,000
Security Capital European
Realty (Luxembourg) 299,275 194,827
Unisource Energy 800,000 0
1-800-922-6769
20
COLUMBIA ACORN FUND
>STATEMENT OF INVESTMENTS (UNAUDITED), JUNE 30, 2004
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
SECURITIES: 94.3%
- ----------------------------------------------------------------------------
INFORMATION: 24.9%
SOFTWARE/SERVICES
>BUSINESS SOFTWARE: 5.6%
11,500,000 Novell (b) $ 96,485
DIRECTORY, OPERATING SYSTEM & IDENTITY
MANAGEMENT SOFTWARE
1,600,000 Avid Technology (b)(c) 87,312
DIGITAL NONLINEAR EDITING SOFTWARE & SYSTEMS
1,625,000 Kronos (b)(c) 66,950
LABOR MANAGEMENT SOLUTIONS
3,450,000 PeopleSoft (b) 63,825
HR, ERP, CRM & SUPPLY CHAIN SOFTWARE
3,550,000 Aspect Communications (b) 50,410
CALL CENTER SOFTWARE
950,000 Micros Systems (b)(c) 45,571
INFORMATION SYSTEMS FOR RESTAURANTS & HOTELS
1,875,000 McAfee (b) 33,994
SECURITY SOFTWARE & SERVICES
6,700,000 E.Piphany (b)(c) 32,361
CRM SOFTWARE
2,200,000 JDA Software Group (b)(c) 28,974
APPLICATIONS/SOFTWARE & SERVICES FOR RETAILERS
2,035,000 MRO Software (b)(c) 27,696
ENTERPRISE MAINTENANCE SOFTWARE
1,521,000 Sybase (b) 27,378
DATABASE SOFTWARE
6,000,000 Actuate (b)(c) 23,700
INFORMATION DELIVERY SOFTWARE & SOLUTIONS
2,200,000 MAPICS (b)(c) 23,232
MID MARKET ERP SOFTWARE
3,000,000 Lawson Software (b) 21,240
ENTERPRISE RESOURCE PLANNING (ERP) SOFTWARE
1,500,000 Witness Systems (b)(c) 18,225
CUSTOMER EXPERIENCE MANAGEMENT SOFTWARE
5,600,000 Indus International (b)(c) 11,760
ENTERPRISE ASSET MANAGEMENT SOFTWARE
500,000 SPSS (b) 8,985
STATISTICAL/BUSINESS ANALYSIS SOFTWARE
1,575,000 Radiant Systems (b)(c) 7,387
POINT OF SALE SYSTEMS FOR CONVENIENCE STORES
750,000 Netegrity (b) 6,345
ENTERPRISE SECURITY SOFTWARE
3,300,000 BSQUARE (b)(c) 3,300
SOFTWARE TO HELP DESIGN MOBILE DEVICES
1,250,000 ClickSoftware Technologies (b) 2,875
SERVICE CHAIN OPTIMIZATION SOFTWARE
70,000 Group 1 Software (b) 1,606
ADDRESS VERIFICATION SOFTWARE
- ----------------------------------------------------------------------------
689,611
>BUSINESS INFORMATION/MARKETING
SERVICES/PUBLISHING: 1.7%
1,200,000 Getty Images (b) 72,000
PHOTOGRAPHS FOR PUBLICATIONS & ELECTRONIC MEDIA
1,336,000 Navigant Consulting (b) 28,644
CONSULTING FIRM
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
2,685,000 InfoUSA (b)(c) $ 27,226
BUSINESS DATA FOR SALES LEADS
1,000,000 Ceridian (b) 22,500
HR SERVICES & PAYMENT PROCESSING
530,000 Fair Isaac 17,691
CREDIT SCORING & DECISION ANALYTIC SOFTWARE
600,000 Information Holdings (b) 16,422
PATENT & OTHER BUSINESS INFORMATION
950,000 Administaff (b) 15,770
PROFESSIONAL EMPLOYER ORGANIZATION
119,000 RH Donnelley (b) 5,205
YELLOW PAGES PUBLISHER
1,700,000 PRIMEDIA (b) 4,726
SPECIALTY MAGAZINES & OTHER PUBLICATIONS
- ----------------------------------------------------------------------------
210,184
>INTERNET: 1.3%
9,500,000 Skillsoft Publishing (b)(c) 72,200
PROVIDER OF WEB-BASED LEARNING SOLUTIONS
(E-LEARNING)
2,200,000 RSA Security (b) 45,034
ENTERPRISE SECURITY SOFTWARE
2,000,000 ValueClick (b) 23,960
INTERNET ADVERTISING
1,400,000 DoubleClick (b) 10,878
INTERNET ADVERTISING & DIRECT MARKETING
STATISTICAL DATA
500,000 Autobytel (b) 4,540
AUTO WEBSITES FOR SALES LEADS & ADVERTISING
1,879,808 Vital Stream, Cl. C (b)(c) 1,410
STREAMING SERVICES FOR THE INTERNET
250,000 NeoPlanet, Series A (d) 51
53,376 NeoPlanet, Series B (d) 18
WEB BROWSER
- ----------------------------------------------------------------------------
158,091
>TRANSACTION PROCESSORS: 1.0%
1,457,000 Global Payments 65,594
CREDIT CARD PROCESSOR
1,250,000 Pegasus Systems (b)(c) 16,413
TRANSACTION PROCESSOR FOR HOTEL INDUSTRY
600,000 Cubic 12,558
REVENUE COLLECTION & DEFENSE SYSTEMS
5,000,000 Hong Kong Exchanges &
Clearing (Hong Kong) 10,308
TRADING, CLEARING & SETTLEMENT SERVICES FOR
FINANCIAL MARKETS
175,000 Deutsche Boerse (Germany) 8,910
TRADING, CLEARING & SETTLEMENT SERVICES
FOR FINANCIAL MARKETS
286,000 Euronet Worldwide (b) 6,615
ATM PROCESSOR
- ----------------------------------------------------------------------------
120,398
>COMPUTER SERVICES: 0.9%
3,350,000 Bearing Point (b) 29,714
BUSINESS CONSULTING & TECHNOLOGY STRATEGY
4,600,000 AnswerThink Consulting (b)(c) 26,358
IT INTEGRATOR FOR FORTUNE 2000
3,100,000 Ciber (b)(c) 25,482
SOFTWARE SERVICES & STAFFING
4,656,000 Igate Capital (b)(c) 18,531
TECHNOLOGY STAFFING SERVICES
21
COLUMBIA ACORN FUND
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>COMPUTER SERVICES--CONTINUED
2,300,000 Analysts International (b)(c) $ 7,084
TECHNOLOGY STAFFING SERVICES
1,025,000 New Horizons Worldwide (b)(c) 6,150
COMPUTER TRAINING SERVICES
205,000 Perot Systems (b) 2,720
BUSINESS CONSULTING & TECHNOLOGY STRATEGY
- ----------------------------------------------------------------------------
116,039
>ELECTRONICS DISTRIBUTION: 0.6%
1,695,000 Avnet (b) 38,476
ELECTRONIC COMPONENTS DISTRIBUTION
680,000 Tech Data (b) 26,608
I/T DISTRIBUTOR
710,000 Agilysys 9,791
I/T DISTRIBUTOR
- ----------------------------------------------------------------------------
74,875
>CONSUMER SOFTWARE: 0.5%
1,400,000 THQ (b) 32,060
ENTERTAINMENT SOFTWARE
1,125,000 Activision (b) 17,887
ENTERTAINMENT SOFTWARE
2,000,000 Pinnacle Systems (b) 14,300
VIDEO EDITING SOFTWARE & HARDWARE
- ----------------------------------------------------------------------------
64,247
COMPUTER RELATED HARDWARE
>COMPUTER HARDWARE/RELATED SYSTEMS: 2.5%
494,000 Zebra Technologies (b) 42,978
BAR CODE PRINTERS
2,500,000 Seachange International (b)(c) 42,200
SYSTEMS FOR VIDEO ON DEMAND & AD INSERTION
1,060,000 Avocent (b) 38,944
COMPUTER CONTROL SWITCHES
445,000 Rogers (b) 31,106
PCB LAMINATES & HIGH PERFORMANCE FOAMS
1,525,000 Unova (b) 30,881
BARCODE & WIRELESS LAN SYSTEMS
371,900 Neopost (France) 22,008
POSTAGE METERS
625,000 Excel Technologies (b)(c) 20,781
LASER SYSTEMS & ELECTRO-OPTICAL COMPONENTS
2,900,000 3Com (b) 18,125
NETWORKING EQUIPMENT
1,575,000 Cable Design Technologies (b)(c) 16,695
NETWORKING & SPECIALTY CABLES
535,000 II VI (b) 16,403
LASER COMPONENTS
1,350,000 CTS 16,281
ELECTRONIC COMPONENTS, SENSORS & EMS
4,656,000 Concurrent Computer (b)(c) 9,219
VIDEO ON DEMAND SYSTEMS & SERVICES
230,000 Applied Films (b) 6,675
THIN-FILM GLASS COATING EQUIPMENT
351,000 Phoenixtec Power (Taiwan) 346
UNINTERRUPTIBLE POWER SUPPLIES
- ----------------------------------------------------------------------------
312,642
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>GAMING EQUIPMENT: 2.4%
6,700,000 International Game Technology $ 258,620
SLOT MACHINES & PROGRESSIVE JACKPOTS
940,000 Shuffle Master (b) 34,131
CARD SHUFFLERS, CASINO GAMES & SLOT MACHINES
- ----------------------------------------------------------------------------
292,751
>INSTRUMENTATION: 1.2%
810,000 Mettler Toledo (b) 39,803
LABORATORY EQUIPMENT
1,350,000 Trimble Navigation (b) 37,517
GPS-BASED INSTRUMENTS
536,000 Dionex (b) 29,571
ION & LIQUID CHROMATOGRAPHY
2,300,000 Spectris (United Kingdom) 20,859
ELECTRONIC INSTRUMENTATION & CONTROLS
428,000 Varian (b) 18,040
ANALYTICAL INSTRUMENTS
- ----------------------------------------------------------------------------
145,790
>SEMICONDUCTORS/RELATED EQUIPMENT: 1.1%
1,315,000 Integrated Circuit Systems (b) 35,715
SILICON TIMING DEVICES
685,000 Littelfuse (b) 29,051
LITTLE FUSES
850,000 Semtech (b) 20,009
ANALOG SEMICONDUCTORS
1,380,000 Ase Test (Taiwan) (b) 10,171
SEMICONDUCTOR PACKAGING & TEST SERVICES
1,250,000 IXYS (b) 9,850
POWER SEMICONDUCTORS
565,000 Supertex (b) 9,232
MIXED-SIGNAL SEMICONDUCTORS
664,000 Asyst Technologies (b) 6,866
SEMICONDUCTOR FAB AUTOMATION EQUIPMENT
361,000 Actel (b) 6,678
FIELD PROGRAMMABLE GATE ARRAYS
604,000 Pericom Semiconductor (b) 6,469
SEMICONDUCTORS - INTERFACE INTEGRATED CIRCUITS
- ----------------------------------------------------------------------------
134,041
>CONTRACT MANUFACTURING: 0.8%
1,500,000 Jabil Circuit (b) 37,770
ELECTRONIC MANUFACTURING SERVICES
3,150,000 Venture (Singapore) 33,115
ELECTRONIC CONTRACT MANUFACTURER
1,600,000 Plexus (b) 21,600
ELECTRONIC MANUFACTURING SERVICES
- ----------------------------------------------------------------------------
92,485
TELECOMMUNICATIONS
>MOBILE COMMUNICATIONS: 1.7%
3,000,000 Western Wireless (b) 86,730
RURAL CELLULAR PHONE SERVICES
4,000,000 Crown Castle International (b) 59,000
COMMUNICATION TOWERS IN USA & UK
520,000 Telephone & Data Systems 37,024
CELLULAR & TELEPHONE SERVICES
1,750,000 American Tower (b) 26,600
COMMUNICATION TOWERS IN USA & MEXICO
1-800-922-6769
22
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>MOBILE COMMUNICATIONS--CONTINUED
300,000 COMARCO (b) $ 2,115
WIRELESS NETWORK TESTING
- ----------------------------------------------------------------------------
211,469
>TELECOMMUNICATION EQUIPMENT: 1.2%
8,700,000 Tellabs (b) 76,038
TELECOMMUNICATIONS & CABLE EQUIPMENT
830,000 Plantronics (b) 34,943
COMMUNICATION HEADSETS
1,600,000 Andrew (b) 32,016
WIRELESS INFRASTRUCTURE EQUIPMENT
1,200,000 Symmetricom (b) 10,680
NETWORK TIMING & SYNCHRONIZATION DEVICES
- ----------------------------------------------------------------------------
153,677
>TELECOMMUNICATIONS/WIRELINE
COMMUNICATIONS: 0.3%
800,000 Commonwealth Telephone (b) 35,816
RURAL PHONE FRANCHISES & CLEC
- ----------------------------------------------------------------------------
MEDIA
>TELEVISION PROGRAMMING/CATV: 1.0%
2,700,000 Insight Communications (b)(c) 25,002
CATV FRANCHISES IN MIDWEST
2,605,000 Liberty Media (b) 23,419
CATV PROGRAMMING & MEDIA COMPANY HOLDINGS
1,150,000 Corus Entertainment (Canada) 22,297
TELEVISION PROGRAMMING & RADIO STATIONS
2,500,000 Mediacom Communications (b) 19,550
CABLE TELEVISION FRANCHISES
2,379,000 United Global Com (b) 17,272
VIDEO, VOICE & DATA SERVICES OUTSIDE THE USA
500,000 Alliance Atlantis Communication
(Canada) (b) 9,317
CATV CHANNELS, TV/MOVIE
PRODUCTION/DISTRIBUTION
131,000 Liberty Media International (b) 4,860
CATV HOLDING COMPANY
- ----------------------------------------------------------------------------
121,717
>RADIO BROADCASTING: 0.6%
770,000 Salem Communications (b) 20,890
RADIO STATIONS FOR RELIGIOUS PROGRAMMING
1,200,000 Cumulus Media, Cl. A (b) 20,172
RADIO STATIONS IN SMALL CITIES
992,000 Saga Communications (b)(c) 18,104
RADIO STATIONS IN SMALL & MID-SIZED CITIES
1,200,000 Spanish Broadcasting (b) 11,172
SPANISH LANGUAGE RADIO STATIONS
- ----------------------------------------------------------------------------
70,338
>TV/SATELLITE BROADCASTING: 0.5%
2,537,000 SES Global (Luxembourg) 21,447
SATELLITE BROADCASTING SERVICES
1,400,000 Gray Television 19,446
MID MARKET AFFILIATED TV STATIONS
1,000,000 Entravision Communications (b) 7,680
SPANISH LANGUAGE TV, RADIO & OUTDOOR
270,000 Metropole TV (France) 7,633
TELEVISION BROADCASTER
200,000 Young Broadcasting (b) 2,630
TELEVISION STATIONS
NUMBER OF SHARES
OR PRINCIPAL AMOUNT (000) VALUE (000)
- ----------------------------------------------------------------------------
75,000 Gestevis Telecino (Spain) (b) $ 1,119
SPAIN'S SECOND LARGEST BROADCASTER
224,700 TVB (Hong Kong) 970
TELEVISION PROGRAMMING & BROADCASTING
- ----------------------------------------------------------------------------
60,925
-----------
INFORMATION: TOTAL 3,065,096
- ----------------------------------------------------------------------------
CONSUMER GOODS/SERVICES: 21.8%
SERVICES
>RETAIL: 6.6%
2,495,000 Chico's FAS (b) 112,674
WOMEN'S SPECIALTY RETAILER
1,600,000 Michaels Stores 88,000
CRAFT & HOBBY SPECIALTY RETAILER
3,743,000 Christopher & Banks (c) 66,288
WOMEN'S APPAREL RETAILER
2,265,000 Aeropostale (b) 60,951
MALL BASED TEEN RETAILER
788,000 Urban Outfitters (b) 47,997
ECLECTIC HOME & APPAREL RETAILER
1,400,000 Williams Sonoma (b) 46,144
HOME GOODS & FURNISHING RETAILER
5,100,000 Winn Dixie Stores 36,720
SUPERMARKETS IN THE SOUTHEAST US
895,000 Abercrombie & Fitch 34,681
TEEN APPAREL RETAILER
350,000 Whole Foods Market 33,408
NATURAL FOOD SUPERMARKETS
1,015,000 Petco Animal Supplies (b) 32,693
PET SUPPLIES & SERVICES
1,300,000 Borders Group 30,472
BOOKSTORES
1,072,000 Zale (b) 29,223
SPECIALTY RETAILER OF JEWELRY
1,370,000 Hot Topic (b) 28,071
MUSIC INSPIRED RETAILER OF APPAREL, ACCESSORIES
& GIFTS
773,000 Sports Authority (b) 27,751
SPORTING GOODS STORES
863,000 Ann Taylor (b) 25,010
WOMEN'S APPAREL RETAILER
823,000 West Marine (b) 22,098
LARGEST RETAILER OF BOATING SUPPLIES
700,000 Genesco (b) 16,541
MULTI-CONCEPT BRANDED FOOTWEAR RETAILER
200,000 Fast Retailing (Japan) 16,251
APPAREL RETAILER
1,700,000 Burberry Group (United Kingdom) 12,630
APPAREL RETAILER
600,000 Brookstone (b) 12,030
SPECIALTY CONSUMER PRODUCT RETAILER
2,250,000 Esprit Holdings (Hong Kong) (b) 10,117
GLOBAL APPAREL BRAND MANAGER
210,000 Otsuke Kagu (Japan) 6,556
FURNITURE RETAILER
950,000 Gaiam (b)(c) 6,441
HEALTHY LIVING CATALOG & E-COMMERCE
$ 6,000 Gadzooks 5% Convertible 10/07/08 (b)(d) 2,941
TEEN APPAREL RETAILER
- ----------------------------------------------------------------------------
805,688
23
COLUMBIA ACORN FUND
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>CONSUMER SERVICES: 1.6%
2,250,000 ITT Educational Services (b) $ 85,545
TECHNOLOGY-ORIENTED POST SECONDARY DEGREE
PROGRAMS
775,000 Weight Watchers (b) 30,334
WEIGHT LOSS PROGRAMS
1,290,000 Coinstar (b)(c) 28,341
OWNER/OPERATOR OF COIN COUNTING MACHINES
900,000 Central Parking 16,821
OWNER, OPERATOR & MANAGER OF PARKING
LOTS & GARAGES
1,750,000 Princeton Review (b)(c) 13,248
COLLEGE PREPARATION COURSES
2,350,000 Bally Total Fitness (b)(c) 11,750
NATIONAL CHAIN OF FITNESS CENTERS
135,000 USS (Japan) 11,615
USED CAR AUCTIONEER
- ----------------------------------------------------------------------------
197,654
>ENTERTAINMENT/LEISURE PRODUCTS: 1.5%
805,000 International Speedway Motors 39,155
LARGEST MOTORSPORT RACETRACK OWNER & OPERATOR
1,250,000 Leapfrog Enterprises (b) 24,862
EDUCATIONAL TOYS
2,765,000 Six Flags (b) 20,074
WORLDWIDE THEME PARK OPERATOR
545,000 RC2 (b) 19,348
COLLECTIBLES & TOYS
1,276,000 Action Performance (c) 19,229
MOTORSPORT COLLECTIBLES & MERCHANDISING
370,000 Amer Group (Finland) 19,281
BRANDED SPORTING GOODS
363,000 Speedway Motorsports 12,139
MOTORSPORT RACETRACK OWNER & OPERATOR
1,750,000 Magna Entertainment, Cl. A
(Canada) (b) 10,325
OWNER/OPERATOR THOROUGHBRED
RACETRACKS
500,000 Natura Cosmetics (Brazil) (b) 8,042
DIRECT SALES OF HIGH-END COSMETICS
500,000 Callaway Golf 5,670
PREMIUM GOLF CLUBS & BALLS
345,000 Intralot (Greece) 5,485
LOTTERY & GAMING SYSTEMS & SERVICES
- ----------------------------------------------------------------------------
183,610
>CASINOS: 1.4%
2,750,000 Alliance Gaming (b)(c) 47,190
DIVERSIFIED GAMING COMPANY
890,000 Station Casinos 43,076
CASINOS & RIVERBOATS
875,000 Argosy Gaming (b) 32,900
REGIONAL RIVERBOAT CASINOS
1,925,000 Pinnacle Entertainment (b)(c) 24,274
REGIONAL RIVERBOAT CASINOS
5,000,000 Sky City Entertainment (New Zealand) 15,143
CASINO/ENTERTAINMENT COMPLEX
805,000 Monarch Casino & Resort (b)(c) 11,350
CASINO/HOTEL IN RENO
226,000 Lakes Entertainment (b) 2,619
GAMING ENTREPRENEUR
230,700 Rank Group (United Kingdom) 1,257
GAMING & MEDIA SERVICES
- ----------------------------------------------------------------------------
177,809
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>TRAVEL: 1.0%
2,314,500 Intrawest (Canada) $ 36,921
OWNER/OPERATOR OF SKI RESORTS
3,380,000 LaQuinta (b) 28,392
OWNER/FRANCHISER OF MID-PRICED HOTELS
1,115,000 Vail Resorts (b) 21,363
OWNER/OPERATOR OF SKI RESORTS
959,000 Navigant International (b)(c) 17,061
CORPORATE TRAVEL AGENCY
750,000 Orbitz (b)(c) 16,215
ONLINE TRAVEL DISTRIBUTION
720,000 Jurys Doyle Hotel (Ireland) 9,123
HOTEL GROUP
- ----------------------------------------------------------------------------
129,075
>RESTAURANTS: 0.8%
2,000,000 AFC Enterprises (b)(c) 43,000
POPEYES, CHURCHES FRIED CHICKEN
1,447,000 Autogrill (Italy) (b) 20,534
TOLLWAY RESTAURANTS
155,000 Kappa Create (Japan) 10,742
155,000 Kappa Create New Shares (Japan) 10,398
SUSHI CHAIN RESTAURANT OPERATOR
243,000 Cheesecake Factory (b) 9,669
CASUAL DINING RESTAURANTS
- ----------------------------------------------------------------------------
94,343
>CRUISE LINES: 0.1%
400,000 Carnival 18,800
LARGEST CRUISE LINE
- ----------------------------------------------------------------------------
GOODS
>APPAREL: 2.0%
2,840,000 Coach (b) 128,340
DESIGNER & RETAILER OF BRANDED LEATHER
ACCESSORIES
564,000 Oxford Industries 24,568
BRANDED & PRIVATE LABEL APPAREL
400,000 Columbia Sportswear (b) 21,848
ACTIVE OUTDOOR APPAREL, FOOTWEAR & ACCESSORIES
3,000,000 Billabong International (Australia) 17,219
SURFWEAR APPAREL MANUFACTURER
828,000 Steven Madden (b)(c) 16,535
WHOLESALER/RETAILER OF FASHION FOOTWEAR
1,100,000 Wacoal (Japan) 11,695
WOMEN'S SPECIALTY APPAREL
369,000 Carter's (b) 10,742
CHILDREN'S BRANDED APPAREL
5,000,000 Pacific Brands (Australia) (b) 9,274
DOMINANT AUSTRALIAN APPAREL BRAND MANAGER
- ----------------------------------------------------------------------------
240,221
>FURNITURE/TEXTILES: 1.9%
1,600,000 HNI 67,728
OFFICE FURNITURE & FIREPLACES
1,900,000 Herman Miller 54,986
OFFICE FURNITURE
740,000 Mohawk Industries (b) 54,264
CARPET & FLOORING
422,000 American Woodmark (c) 25,257
KITCHEN CABINETS
1,700,000 Nobia (Sweden) 20,023
KITCHEN INTERIORS MANUFACTURING & DISTRIBUTION
1-800-922-6769
24
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>FURNITURE/TEXTILES--CONTINUED
550,000 Masonite International (Canada) (b) $ 14,186
DOOR MANUFACTURER
- ----------------------------------------------------------------------------
236,444
>LEISURE VEHICLES: 1.5%
1,745,000 Harley-Davidson 108,085
MOTORCYCLES & RELATED MERCHANDISE
1,495,000 Monaco Coach (c) 42,114
RECREATIONAL VEHICLES
550,000 Polaris Industries 26,400
MANUFACTURER OF LEISURE VEHICLES & RELATED
PRODUCTS
2,850,000 Ducati Motor (Italy) (b) 3,995
MOTORCYCLES & RELATED MERCHANDISE
- ----------------------------------------------------------------------------
180,594
>DURABLE GOODS: 1.3%
1,326,000 SCP Pool 59,670
DISTRIBUTOR OF SWIMMING POOL SUPPLIES
605,000 Hunter Douglas (Netherlands) 29,455
WINDOW SHADES & VENETIAN BLINDS
465,000 Hyundai Mobis (South Korea) 20,716
AUTO PARTS
10,000,000 Techtronic Industries (Hong Kong) 15,978
POWER TOOLS
105,000 Funai Electric (Japan) 15,852
CONSUMER ELECTRONICS
644,100 Shimano (Japan) 15,326
BICYCLE COMPONENTS & FISHING TACKLE
- ----------------------------------------------------------------------------
156,997
>NONDURABLES: 1.1%
895,000 Scotts Company (b) 57,173
CONSUMER LAWN & GARDEN PRODUCTS
1,381,000 Helen of Troy (b) 50,917
HAIRDRYERS & CURLING IRONS
255,000 Uni-Charm (Japan) 12,704
INFANT HYGIENE & FEMININE CARE PRODUCTS
601,000 First Years (c) 11,179
INFANT & TODDLER PRODUCTS
- ----------------------------------------------------------------------------
131,973
>FOOD & Beverages: 1.0%
1,600,000 Kerry (Ireland) 33,894
FOOD INGREDIENTS
850,000 NBTY (b) 24,981
VITAMINS & SUPPLEMENTS
30,000,000 Global Bio-Chem Technology
Group (China) 21,789
1,841,250 Global Bio-Chem Technology
Group Warrants (China) (b) 120
CHINESE REFINER OF CORN-BASED COMMODITIES
4,000,000 Lion Nathan (Australia) 18,845
BEER BREWER/DISTRIBUTOR
725,000 Orkla (Norway) 18,132
DIVERSIFIED CONSUMER GOODS
180,000 Davide Campari (Italy) 8,885
SPIRITS & WINE
- ----------------------------------------------------------------------------
126,646
-----------
CONSUMER GOODS/SERVICES: TOTAL 2,679,854
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
INDUSTRIAL GOODS/SERVICES: 13.5%
>LOGISTICS: 2.4%
2,750,000 Expeditors International of
Washington $ 135,877
INTERNATIONAL FREIGHT FORWARDER
900,000 UTI Worldwide 47,421
INTERNATIONAL FREIGHT FORWARDER
1,000,000 Forward Air (b) 37,400
FREIGHT TRANSPORTATION BETWEEN AIRPORTS
2,600,000 Exel (United Kingdom) 36,255
GLOBAL LOGISTICS & FREIGHT FORWARDING
549,000 Hub Group (b)(c) 18,721
TRUCK & RAIL FREIGHT FORWARDER
40,000,000 Sinotrans (China) 14,405
INTEGRATED LOGISTICS IN CHINA
11,000,000 Sembcorp Logistics (Singapore) 11,778
LOGISTIC SERVICES FOR MARINE TRANSPORT
- ----------------------------------------------------------------------------
301,857
>MACHINERY: 1.6%
2,250,000 Ametek 69,525
AEROSPACE/INDUSTRIAL INSTRUMENTS
1,050,000 Esco Technologies (b)(c) 56,028
FILTRATION & TEST EQUIPMENT
840,000 Pentair 28,258
PUMPS, WATER TREATMENT & TOOLS
785,000 Gardner Denver (b) 21,901
AIR COMPRESSORS, BLOWERS & PUMPS
500,000 Cobham (United Kingdom) 12,683
AEROSPACE
150,000 Tennant 6,218
NON-RESIDENTIAL FLOOR CLEANING EQUIPMENT
- ----------------------------------------------------------------------------
194,613
>SPECIALTY CHEMICALS & INDUSTRIAL
MATERIALS: 1.6%
2,550,000 Spartech (c) 66,147
PLASTICS DISTRIBUTION & COMPOUNDING
47,000 Geberit International (Switzerland) 31,331
PLUMBING SUPPLIES
1,000,000 Schulman 21,490
PLASTICS DISTRIBUTION & COMPOUNDING
37,000 Givaudan (Switzerland) 21,451
INDUSTRIAL FRAGRANCES & FLAVORS
450,000 Novozymes (Denmark) 20,305
INDUSTRIAL ENZYMES
25,000 Sika (Switzerland) (b) 13,763
CHEMICALS FOR CONSTRUCTION & INDUSTRIAL
APPLICATION
200,000 Imerys (France) 11,660
INDUSTRIAL MINERALS PRODUCER
347,000 SYMYX (b) 8,370
MATERIALS & CHEMICALS
- ----------------------------------------------------------------------------
194,517
>INDUSTRIAL GOODS: 1.5%
1,400,000 Clarcor (c) 64,120
MOBILE & INDUSTRIAL FILTERS
1,500,000 Donaldson 43,950
INDUSTRIAL AIR FILTRATION
25
COLUMBIA ACORN FUND
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>INDUSTRIAL GOODS--CONTINUED
804,000 Mine Safety Appliances $ 27,095
SAFETY EQUIPMENT
300,000 Genlyte Group (b) 18,864
COMMERCIAL LIGHTING FIXTURES
500,000 Intermagnetics General (b) 17,015
SUPERCONDUCTING WIRE
100,000 Bacou Dalloz (France) 7,424
SAFETY EQUIPMENT
309,000 Electric City (b) 584
ELECTRICITY CONSERVATION DEVICES
- ----------------------------------------------------------------------------
179,052
>INDUSTRIAL DISTRIBUTION: 1.4%
1,525,000 Watsco (c) 42,807
HVAC DISTRIBUTION
600,000 Hughes Supply 35,358
INDUSTRIAL DISTRIBUTION
1,375,000 Airgas 32,876
INDUSTRIAL GAS DISTRIBUTOR
3,800,000 Grafton Group (Ireland) (b) 30,321
BUILDERS, WHOLESALERS & DIY RETAILING
900,000 Nuco2 (b)(c) 17,730
BULK CO2 GAS DISTRIBUTION TO RESTAURANTS
600,000 Aviall (b) 11,406
AIRCRAFT REPLACEMENT PARTS DISTRIBUTOR
- ----------------------------------------------------------------------------
170,498
>WATER: 1.0%
856,000 Cuno (b)(c) 45,668
FILTRATION & FLUIDS CLARIFICATION
2,600,000 Tetra Tech (b) 42,432
RESOURCE MANAGEMENT & INFRASTRUCTURE CONSULTING
900,000 Pall 23,571
FILTRATION & FLUIDS CLARIFICATION
554,000 Watts Water Technologies 14,930
WATER, VALVES, REGULATORS & FILTRATION
- ----------------------------------------------------------------------------
126,601
>CONSTRUCTION: 1.0%
787,500 Wienerberger (Austria) 27,473
BRICKS & CLAY ROOFING TILES
488,000 Simpson 27,387
WALL JOINT MAKER
638,000 Florida Rock Industries 26,904
CONCRETE & AGGREGATES
380,000 Daito Trust Construction (Japan) 14,612
APARTMENT BUILDER
3,000,000 Consorcio (Mexico) (b) 8,634
LOW/MEDIUM INCOME HOME BUILDER
750,000 McCarthy & Stone (United Kingdom) 7,925
BUILDER OF RETIREMENT APARTMENTS
290,000 Dominion Homes (b) 6,699
OHIO/KENTUCKY HOME BUILDER
- ----------------------------------------------------------------------------
119,634
>STEEL: 1.0%
1,900,000 Gibraltar Steel (c) 62,358
STEEL PROCESSING
750,000 Tenaris (Argentina) 24,563
STEEL PIPE FOR OIL WELLS & PIPELINES
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
1,050,000 Worthington Industries $ 21,557
STEEL PROCESSING
95,000 Vallourec (France) 9,339
SEAMLESS TUBES
- ----------------------------------------------------------------------------
117,817
>OTHER INDUSTRIAL SERVICES: 0.9%
1,500,000 Clark/Bardes Consulting (b)(c) 27,825
EXECUTIVE COMPENSATION & BENEFITS CONSULTING
825,000 Mobile Mini (b)(c) 23,438
LEASES PORTABLE STORAGE UNITS
550,000 G&K Services 22,104
UNIFORM RENTAL
1,125,000 Ushio (Japan) 20,353
INDUSTRIAL LIGHT SOURCES
60,000 Schindler (Switzerland) 17,238
ELEVATOR MANUFACTURER & SERVICE PROVIDER
185,000 Jaakko Poyry (Finland) 4,673
ENGINEERING CONSULTANTS IN FORESTRY, ENERGY
- ----------------------------------------------------------------------------
115,631
>OUTSOURCING SERVICES & Training: 0.6%
1,800,000 Labor Ready (b) 27,900
TEMPORARY MANUAL LABOR
525,000 Bilfinger Berger (Germany) 18,167
CONSTRUCTION & RELATED SERVICES
9,500,000 Li & Fung (Hong Kong) 13,928
SOURCING OF CONSUMER GOODS
640,000 United Services Group (Netherlands) 10,443
TEMPORARY STAFFING SERVICES
600,000 GP Strategies (b) 3,954
TRAINING PROGRAMS
- ----------------------------------------------------------------------------
74,392
>CONGLOMERATES: 0.3%
737,560 Aalberts Industrie (Netherlands) 22,086
FLOW CONTROL & HEAT TREATMENT
5,550 Pargesa (Switzerland) 14,945
INDUSTRIAL & MEDIA HOLDINGS
- ----------------------------------------------------------------------------
37,031
>INDUSTRIAL SUPPLIERS: 0.2%
1,800,000 Xstrata (United Kingdom) 24,118
DIVERSIFIED MINING HOLDING COMPANY
- ----------------------------------------------------------------------------
-----------
INDUSTRIAL GOODS/SERVICES: TOTAL 1,655,761
- ----------------------------------------------------------------------------
FINANCE: 12.3%
>BANKS: 5.1%
1,751,000 TCF Financial 101,646
GREAT LAKES BANK
2,412,000 Associated Banc-Corp 71,468
MIDWEST BANK
1,638,000 BOK Financial (b) 64,324
OKLAHOMA BANK
2,187,000 Glacier Bancorp (c) 61,608
MOUNTAIN STATES BANK
1,300,000 Texas Regional Bancshares 59,683
SOUTH TEXAS BANK
1-800-922-6769
26
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>BANKS--CONTINUED
3,300,000 Anglo Irish Bank (Ireland) $ 51,693
SMALL BUSINESS & MIDDLE MARKET BANKING
1,320,000 West Coast Bancorp (c) 28,301
PORTLAND SMALL BUSINESS LENDER
1,850,000 Depfa Bank (Ireland) 27,005
INTERNATIONAL PUBLIC SECTOR FINANCE
1,698,000 Republic 23,602
MICHIGAN BANK
605,000 Chittenden 21,266
VERMONT & WESTERN MASSACHUSETTS BANK
2,800,000 Den Norske Bank (Norway) 19,099
LARGEST NORWEGIAN BANK
370,000 Cullen Frost Bankers 16,557
TOP SAN ANTONIO BANK
145,000 Komercni Banka (Czech Republic) 16,266
LEADING CZECH UNIVERSAL BANK
455,000 Great Southern Bancorp 13,309
MISSOURI REAL ESTATE LENDER
360,000 CityBank Lynnwood 11,527
SEATTLE REAL ESTATE LENDER
400,000 CorpBanca (Chile) (b)(d) 9,560
CHILE'S 3RD LARGEST LOCAL BANK
231,000 Bank of the Ozarks 5,382
ARKANSAS BANK
82,000 BankFirst 4,899
OKLAHOMA COMMUNITY BANK
170,000 Midwest Bank 3,791
CHICAGO BANK
82,000 First Financial BankShares 3,438
WEST TEXAS COMMUNITY BANK
188,000 Cascade Financial 3,290
SEATTLE COMMUNITY BANK
125,000 First Mutual Bancshares 3,156
SEATTLE COMMUNITY BANK
210,000 Credito Emiliano (Italy) 1,727
ITALIAN REGIONAL BANK
47,000 West Bancorporation 822
DES MOINES SMALL BUSINESS BANK
- ----------------------------------------------------------------------------
623,419
>INSURANCE: 2.6%
1,320,000 HCC Insurance Holdings 44,101
AVIATION INSURANCE
720,000 Philadelphia Consolidated Holding (b) 43,250
SPECIALTY INSURANCE
826,000 Leucadia National 41,052
INSURANCE HOLDING COMPANY
995,000 Protective Life 38,477
LIFE INSURANCE
138,000 Markel (b) 38,295
SPECIALTY INSURANCE
1,000,000 RLI 36,500
SPECIALTY INSURANCE
400,000 Selective Insurance Group 15,952
COMMERCIAL & PERSONAL LINES INSURANCE
650,000 Scottish Re Group 15,113
LIFE REINSURER
1,992,000 Jardine Lloyd Thompson
(United Kingdom) 14,851
BUSINESS INSURANCE BROKER
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
210,000 StanCorp Financial $ 14,070
GROUP LIFE, DISABILITY & 401K
700,000 United National Group (b) 10,577
SPECIALTY INSURANCE
245,000 Stewart Information Services 8,274
TITLE COMPANY
- ----------------------------------------------------------------------------
320,512
>SAVINGS & LOANS: 2.3%
3,276,000 Peoples Bank Bridgeport 102,047
CONNECTICUT SAVINGS & LOAN
1,227,000 Downey Financial 65,338
CALIFORNIA HOME LENDER
1,178,000 Anchor Bancorp Wisconsin (c) 31,146
WISCONSIN THRIFT
700,000 First Federal Capital 19,481
WISCONSIN THRIFT
1,700,000 Housing Development Finance (India) 19,131
PREMIER MORTGAGE LENDER IN INDIA
709,000 Washington Federal 17,016
OLD FASHIONED MORTGAGE LENDER
959,400 Irish Life & Permanent (Ireland) 14,787
SAVINGS PRODUCTS
200,000 Bankinter (Spain) 7,621
MORTGAGE LENDER
74,000 Imperial Thrift & Loan (b) 3,002
SAN DIEGO SPECIALTY LENDER
- ----------------------------------------------------------------------------
279,569
>FINANCE COMPANIES: 1.4%
5,831,000 AmeriCredit (b) 113,879
AUTO LENDING
1,820,000 World Acceptance (b)(c) 33,361
PERSONAL LOANS
784,000 Northgate (United Kingdom) 9,878
LIGHT COMMERCIAL VEHICLE RENTAL SPECIALIST
500,000 Intermediate Capital (United Kingdom) 9,815
EUROPEAN PROVIDER OF MEZZANINE CAPITAL
- ----------------------------------------------------------------------------
166,933
>MONEY MANAGEMENT: 0.8%
2,390,000 SEI Investments 69,406
MUTUAL FUND ADMINISTRATION & INVESTMENT
MANAGEMENT
855,000 Eaton Vance 32,670
SPECIALTY MUTUAL FUNDS
200,000 The Investment Company of
China (China) (d) 90
CLOSED-END FUND
- ----------------------------------------------------------------------------
102,166
>BROKERAGE: 0.1%
1,215,000 Investment Technology Group (b) 15,540
ELECTRONIC TRADING
- ----------------------------------------------------------------------------
-----------
FINANCE: TOTAL 1,508,139
- ----------------------------------------------------------------------------
HEALTH CARE: 9.1%
>SERVICES: 3.2%
5,586,000 First Health (b)(c) 87,197
PPO NETWORK
2,491,000 Lincare Holdings (b) 81,854
HOME HEALTH CARE SERVICES
27
COLUMBIA ACORN FUND
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>SERVICES--CONTINUED
2,592,000 NDCHealth Group (c) $ 60,134
HEALTH CLAIMS PROCESSING & DRUG MARKETING
SERVICES
640,000 Charles River Laboratories (b) 31,277
PHARMACEUTICAL RESEARCH
3,070,000 Gambro (Sweden) 29,798
PRODUCTS/SERVICES FOR RENAL CARE
510,000 OPG Groep (Netherlands) 27,296
PHARMACEUTICAL WHOLESALER & RETAILER
1,333,000 Dendrite International (b) 24,767
SOFTWARE FOR PHARMACEUTICAL SALES FORCE
450,000 Accredo Health (b) 17,527
SPECIALTY PHARMACY
296,000 Omega Pharma (Belgium) 15,019
OTC PRODUCTS, PHARMACY & DENTAL SUPPLIES
550,000 Serologicals (b) 10,995
BLOOD COLLECTION & ANTIBODY PRODUCTION
440,000 Medquist (b) 5,038
MEDICAL TRANSCRIPTION SERVICES
- ----------------------------------------------------------------------------
390,902
>MEDICAL EQUIPMENT/LABORATORY
SUPPLIES: 2.8%
1,629,000 Edwards Lifesciences (b) 56,771
HEART VALVES
1,239,000 Diagnostic Products 54,442
IMMUNODIAGNOSTIC KITS
2,910,000 Smith & Nephew (United Kingdom) 31,402
MEDICAL EQUIPMENT & SUPPLIES
1,900,000 CTI Molecular Imaging (b) 26,942
MEDICAL DIAGNOSTIC DEVICES
1,000,000 VISX (b) 26,720
LASER EYE SURGERY EQUIPMENT
583,000 Orthofix International (b) 24,912
BONE FIXATION & STIMULATION DEVICES
365,000 Essilor International (France) 23,845
EYEGLASS LENSES
200,000 Synthes-Stratec (Switzerland) 22,820
PRODUCTS FOR ORTHOPEDIC SURGERY
670,000 ICU Medical (b) 22,465
INTRAVENOUS THERAPY PRODUCTS
875,000 Viasys Healthcare (b) 18,296
RESPIRATORY & NEUROLOGY MEDICAL EQUIPMENT
1,000,000 Sola International (b) 17,230
SPECIALTY EYEGLASS LENSES
350,000 Haemonetics (b) 10,377
BLOOD & PLASMA COLLECTION EQUIPMENT
190,000 Hogy Medical (Japan) 9,549
DISPOSABLE SURGICAL PRODUCTS
- ----------------------------------------------------------------------------
345,771
>BIOTECHNOLOGY/DRUG DELIVERY: 2.4%
519,000 Martek Biosciences (b) 29,152
FATTY ACIDS FOR BABY FORMULA & OTHER FOODS
775,000 Par Pharmaceuticals (b) 27,288
GENERICS
1,250,000 Ligand Pharmaceuticals (b) 21,725
DRUGS FOR PAIN, CANCER, OSTEOPOROSIS, & DIABETES
1,055,000 Nektar Therapeutics (b) 21,058
DRUG DELIVERY TECHNOLOGIES
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
360,000 Neurocrine Biosciences (b) $ 18,666
DRUGS FOR SLEEP, DIABETES, MS & ENDOMETRIOSIS
776,000 NPS Pharmaceuticals (b) 16,296
SMALL MOLECULE DRUGS
1,165,000 DOV Pharmaceutical (b)(c) 16,263
DRUGS FOR INSOMNIA, ANXIETY, PAIN & DEPRESSION
789,000 Atherogenics (b) 15,015
DRUGS FOR ATHEROSCLEROSIS, RHEUMATOID
ARTHRITIS, ASTHMA
1,876,000 Lexicon Genetics (b) 14,708
DRUG DISCOVERY
2,000,000 Medarex (b) 14,580
HUMANIZED ANTIBODIES
1,708,000 Ciphergen Biosystems (b)(c) 12,503
PROTEIN CHIPS USED FOR DRUG TARGET DISCOVERY
1,709,000 Pozen (b)(c) 11,690
DRUGS FOR MIGRAINES
608,000 Protein Design Labs (b) 11,631
MONOCLONAL ANTIBODIES
1,700,000 Sangamo Biosciences (b)(c) 10,234
DRUG DISCOVERY
1,150,000 Bioveris (b) 9,568
IMMUNODIAGNOSTIC TECHNOLOGY
3,500,000 La Jolla Pharmaceutical (b)(c) 8,505
LUPUS TREATMENT
460,000 Myriad Genetics (b) 6,863
GENE DISCOVERY & DIAGNOSTIC PRODUCTS
635,000 Maxygen (b) 6,712
MOLECULAR BREEDING
638,000 Diversa (b) 6,463
MOLECULAR BREEDING
304,000 Alexion Pharmaceuticals (b) 5,654
MONOCLONAL ANTIBODIES
865,000 Arena Pharmaceuticals (b) 4,723
NOVEL DRUG TARGETING TECHNOLOGY
2,800,000 Sequenom (b)(c) 4,088
HIGH SPEED DNA ANALYSIS INSTRUMENTS
1,875 Locus Discovery, Series D, Pfd. (d) 3,750
HIGH THROUGHPUT RATIONAL DRUG DESIGN
461,000 SYRRX, Series C (d) 2,305
X-RAY CRYSTALLOGRAPHY
1,249,999 Perlegen Sciences (d) 1,950
LARGE SCALE GENE SEQUENCING
359,944 Microdose (d) 180
DRUG INHALERS
- ----------------------------------------------------------------------------
301,570
>MEDICAL SUPPLIES: 0.4%
686,000 Techne (b) 29,807
CYTOKINES, ANTIBODIES, OTHER REAGENTS FOR
LIFE SCIENCES
650,000 Owens & Minor 16,835
DISTRIBUTION OF MEDICAL SUPPLIES
- ----------------------------------------------------------------------------
46,642
>HOSPITAL MANAGEMENT: 0.2%
500,000 Rhoen-Klinikum (Germany) 26,875
HOSPITAL MANAGEMENT
- ----------------------------------------------------------------------------
1-800-922-6769
28
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>PHARMACEUTICALS: 0.1%
138,000 Yuhan (South Korea) $ 8,482
ETHICAL DRUG PRODUCER
2,000,000 United Drug (Ireland) 6,811
IRISH PHARMACEUTICAL WHOLESALER & OUTSOURCER
- ----------------------------------------------------------------------------
15,293
-----------
HEALTH CARE: TOTAL 1,127,053
- ----------------------------------------------------------------------------
ENERGY/MINERALS: 9.1%
>OIL/GAS PRODUCERS: 5.6%
7,275,000 XTO Energy 216,722
NATURAL GAS PRODUCER
2,800,000 Western Gas 90,944
OIL PRODUCER & COAL SEAM GAS PRODUCER
2,350,000 Ultra Petroleum (b) 87,726
NATURAL GAS PRODUCER
3,000,000 Talisman Energy (Canada) 65,227
OIL & GAS PRODUCER
1,300,000 Southwestern Energy (b) 37,271
NATURAL GAS PRODUCER
925,000 Nexen (Canada) 35,938
OIL & GAS PRODUCER
15,400,000 Tullow Oil (United Kingdom) 34,399
OIL & GAS PRODUCER
465,000 Quicksilver (b) 31,188
NATURAL GAS & COAL SEAM GAS PRODUCER
814,000 Denbury Resources (b) 17,053
OIL PRODUCER USING CO2 INJECTION
915,000 McMoRan Exploration (b)(c) 14,256
NATURAL GAS PRODUCERS & LNG DEVELOPER
582,000 Petrokazakhstan (Canada) (b) 15,842
OIL PRODUCER & REFINER IN KAZAKHSTAN
916,000 Range Resources 13,374
OIL & GAS PRODUCER
440,000 Clayton Williams Energy (b)(d) 9,675
40,000 Clayton Williams Energy (b) 956
OIL & GAS PRODUCER
3,458,200 Esprit Exploration (Canada) (b) 9,018
NATURAL GAS PRODUCER
2,265,000 Tipperary (b)(c) 8,086
COAL SEAM GAS PRODUCER
- ----------------------------------------------------------------------------
687,675
>OIL SERVICES: 2.0%
2,300,000 FMC Technologies (b) 66,240
OIL & GAS WELL HEAD MANUFACTURER
730,000 Carbo Ceramics 49,822
NATURAL GAS WELL STIMULANTS
4,750,000 Newpark Resources (b)(c) 29,450
DRILLING FLUID SERVICES TO OIL & GAS INDUSTRY
333,000 Fugro (Netherlands) 21,459
SURVEY & GPS SERVICES
700,000 Chicago Bridge & Iron 19,495
ENGINEERING & CONSTRUCTION FOR PETROCHEMICALS
& LNG
2,000,000 Key Energy Services (b) 18,880
OIL & GAS WELL WORKOVER SERVICES
2,000,000 Saipem (Italy) 18,226
OFFSHORE CONSTRUCTION & DRILLING
1,050,000 Enerflex Systems (Canada) 16,475
NATURAL GAS COMPRESSOR
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
800,000 Hanover Compressor (b) $ 9,520
NATURAL GAS COMPRESSOR RENTAL
- ----------------------------------------------------------------------------
249,567
>DISTRIBUTION/MARKETING/REFINING: 1.2%
1,600,000 Equitable Resources 82,736
NATURAL GAS UTILITY & PRODUCER
1,900,000 Oneok 41,781
NATURAL GAS UTILITY, MARKETING & PROCESSING
761,000 Atmos Energy 19,482
NATURAL GAS UTILITY
- ----------------------------------------------------------------------------
143,999
>INDEPENDENT POWER: 0.2%
1,470,000 Gamesa (Spain) 21,712
SPANISH WIND TURBINES
314,000 Millennium Cell (b) 584
FUEL CELL TECHNOLOGY
- ----------------------------------------------------------------------------
22,296
>MINING: 0.1%
700,000 Noranda (Canada) 11,998
DIVERSIFIED NON-FERROUS METALS MINER
- ----------------------------------------------------------------------------
-----------
Energy/Minerals: Total 1,115,535
- ----------------------------------------------------------------------------
OTHER INDUSTRIES: 3.6%
>REAL ESTATE: 2.6%
825,000 The Rouse Company 39,188
REGIONAL SHOPPING MALLS
1,320,000 General Growth Properties 39,032
REGIONAL SHOPPING MALLS
699,000 Forest City Enterprises, Cl. B 36,942
COMMERCIAL & RESIDENTIAL PROPERTY DEVELOPER
650,000 SL Green Realty 30,420
MANHATTAN OFFICE BUILDINGS
635,000 Macerich Company 30,397
REGIONAL SHOPPING MALLS
620,000 Mills 28,954
REGIONAL SHOPPING MALLS
575,000 Federal Realty Investment Trust 23,914
SHOPPING CENTERS
1,375,000 Crescent Real Estate Equities 22,165
CLASS A OFFICE BUILDINGS
650,000 United Dominion Realty 12,857
APARTMENTS
1,240,000 Highland Hospitality (b) 12,462
HOTEL REAL ESTATE INVESTMENT TRUST
1,352,600 Sponda (Finland) 11,490
OFFICE & WAREHOUSE PROPERTY COMPANY
1,000,000 Diamondrock Hospitality (b) 10,000
HOTEL REAL ESTATE INVESTMENT TRUST
190,000 Consolidated Tomoka 7,174
FLORIDA LAND OWNER
686,111 Am NV (Netherlands) 6,428
PROPERTY DEVELOPER
194,827 Security Capital European
Realty (Luxembourg) (d) 3,112
SELF STORAGE PROPERTIES
- ----------------------------------------------------------------------------
314,535
29
COLUMBIA ACORN FUND
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>REGULATED UTILITIES: 0.4%
1,650,000 Northeast Utilities $ 32,125
REGULATED ELECTRIC UTILITY
799,800 Red Electrica (Spain) 13,618
SPANISH POWER GRID
- ----------------------------------------------------------------------------
45,743
>TRANSPORTATION: 0.3%
140,000 Kobenhavns Lufthavne (Denmark) 20,416
COPENHAGEN AIRPORT AUTHORITY
620,000 Grupo Aeroportaurio Del
Sureste (Mexico) 11,470
CANCUN & COZUMEL AIRPORT OPERATOR
15,000,000 Comfort Group (Singapore) 10,742
TAXI SERVICE
- ----------------------------------------------------------------------------
42,628
>WASTE MANAGEMENT: 0.3%
1,275,000 Waste Connections (b) 37,817
SOLID WASTE MANAGEMENT
- ----------------------------------------------------------------------------
-----------
OTHER INDUSTRIES: TOTAL 440,723
TOTAL COMMON STOCKS AND OTHER -----------
EQUITY-LIKE SECURITIES: 94.3% 11,592,161
(COST: $7,214,239)
PRINCIPAL AMOUNT (000) VALUE (000)
- ----------------------------------------------------------------------------
SHORT-TERM OBLIGATIONS: 5.6%
Yield 1.04% - 1.30%
Due 7/01/04 - 8/05/04
$ 77,000 General Electric Capital $ 76,939
76,000 Bayer 75,980
72,000 Citigroup 71,934
71,000 Bell South 70,942
70,000 Cargill 69,955
63,980 Campbell Soup 63,950
60,000 Household Finance 59,970
55,000 Coca Cola Enterprises 54,978
40,000 Virginia Electric & Power 39,993
40,000 Toyota Credit de Puerto Rico 39,951
30,000 Toyota Motors 29,978
30,000 John Hancock Finance 29,970
2,506 Repurchase Agreement with State
Street Bank & Trust Dated
6/30/04, Due 7/01/04 at 1.30%
Collateralized by Federal Home
Loan Mortgage Corporation,
Notes, Maturing 2/15/05, Market
Value $2,560 (Repurchase
proceeds: $2,506) 2,506
- ----------------------------------------------------------------------------
(AMORTIZED COST: $687,046) 687,046
-----------
TOTAL INVESTMENTS (e): 99.9% 12,279,207
(COST: $7,901,285) (a)
-----------
CASH AND OTHER ASSETS LESS LIABILITIES: 0.1% 10,343
-----------
TOTAL NET ASSETS: 100% $12,289,550
============================================================================
1-800-922-6769
30
- --------------------------------------------------------------------------------
>NOTES TO STATEMENT OF INVESTMENTS (IN THOUSANDS)
(a) At June 30, 2004, for federal income tax purposes cost of investments was
the same and net unrealized appreciation was $4,377,922 consisting of gross
unrealized appreciation of $4,722,467 and gross unrealized depreciation of
$344,545.
(b) Non-income producing security.
(c) An affiliate may include any company in which the Fund owns five percent or
more of its outstanding voting securities. On June 30, 2004, the Fund held
five percent or more of the outstanding voting securities of the following
companies:
Christopher & Banks 10.26%
AnswerThink Consulting 10.23%
World Acceptance 9.84%
Indus International 9.81%
New Horizons Worldwide 9.81%
Actuate 9.75%
Gibraltar Steel 9.71%
Analysts International 9.50%
MAPICS 9.25%
Seachange International 9.11%
Skillsoft Publishing 9.02%
Igate Capital 8.96%
Glacier Bancorp 8.93%
E.Piphany 8.82%
West Coast Bancorp 8.79%
BSQUARE 8.71%
Monarch Casino & Resort 8.59%
Nuco2 8.41%
MRO Software 8.18%
Esco Technologies 8.12%
Clark/Bardes Consulting 8.06%
Spartech 7.94%
Cable Design Technologies 7.66%
Concurrent Computer 7.58%
JDA Software Group 7.57%
First Years 7.20%
NDCHealth Group 7.20%
AFC Enterprises 7.13%
Sequenom 7.06%
Action Performance 6.96%
Bally Total Fitness 6.90%
Sangamo Biosciences 6.76%
Watsco 6.66%
Witness Systems 6.55%
Navigant International 6.52%
Gaiam 6.46%
DOV Pharmaceutical 6.45%
Princeton Review 6.38%
Steve Madden 6.21%
First Health 6.10%
Coinstar 6.05%
Pozen 5.93%
Vital Stream, Cl. C 5.92%
Hub Group 5.89%
Ciphergen Biosystems 5.87%
Orbitz 5.79%
La Jolla Pharmaceutical 5.77%
Tipperary 5.76%
Mobile Mini 5.75%
Radiant Systems 5.71%
Newpark Resources 5.67%
Clarcor 5.51%
Pegasus Systems 5.44%
Alliance Gaming 5.43%
Pinnacle Entertainment 5.42%
Saga Communications 5.38%
McMoRan Exploration 5.31%
Insight Communications 5.29%
Kronos 5.23%
Excel Technologies 5.19%
Ciber 5.14%
Micros Systems 5.13%
American Woodmark 5.13%
Anchor Bancorp Wisconsin 5.13%
Monaco Coach 5.10%
Avid Technology 5.06%
Cuno 5.05%
InfoUSA 5.03%
The aggregate cost and value of these companies at June 30, 2004, was
$1,459,400 and $2,055,516 respectively. Investments in affiliate companies
represent 16.73% of total net assets at June 30, 2004. Investment activity
and income amounts relating to affiliates during the six months ended June
30, 2004 were as follows:
Dividend Income $ 3,333
Net realized gain or loss $ 62,019
Change in unrealized gain or loss $ 4,005
Purchases $ 182,823
Proceeds from sales $ 214,679
In addition, additional purchases of existing portfolio holdings that were
not considered affiliates in prior years, resulted in the Fund owning more
than 5% of the outstanding shares of certain issues at June 30, 2004.
Therefore, the cost and market value of the affiliate disclosure amounts
include both acquisitions of new investments in affiliates during the
period, as well as prior period investment holdings that became affiliates
during the current period.
31
COLUMBIA ACORN FUND
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
(d) Denotes a restricted security, which is subject to restrictions on resale
under federal securities laws. These securities, except for CorpBanca, are
valued in good faith by the Board of Trustees. At June 30, 2004, these
securities amounted to $33,632, which represents 0.27% of total net assets.
Additional information on these securities is as follows:
ACQUISITION SHARES/
SECURITY DATES PAR (000) COST (000) VALUE (000)
- -------- ----------------- -------- --------- ----------
CorpBanca 11/19/03 400 $ 10,290 $ 9,560
Clayton Williams Energy 05/25/04 440 10,120 9,675
Gadzooks 5.00% Convertible 10/07/08 10/08/03 $ 6,000 6,000 2,941
Locus Discovery, Series D, Pfd. 09/05/01 1,875 7,500 3,750
Microdose 11/24/00 360 2,005 180
NeoPlanet, Series A 02/12/99 250 2,000 51
NeoPlanet, Series B 02/17/00 53 641 18
Perlegen Sciences 03/30/01 1,250 4,500 1,950
Security Capital European Realty 08/20/98-11/12/99 195 3,897 3,112
SYRRX, Series C, Pfd. 01/08/01 461 2,997 2,305
The Investment Company of China 10/22/92-03/15/00 200 1,690 90
--------- ----------
$ 51,640 $ 33,632
========= ==========
(e) On June 30, 2004, the market value of foreign securities represents 15.0%
of total net assets. The Fund's foreign portfolio was diversified as
follows:
VALUE PERCENT
------------ -----------
Canada $ 247,544 2.0%
United Kingdom 216,072 1.8
Ireland 173,634 1.4
Japan 155,653 1.3
Switzerland 121,548 1.0
Netherlands 117,167 1.0
France 81,909 0.7
Singapore 55,635 0.5
Germany 53,952 0.4
Italy 53,367 0.4
Hong Kong 51,301 0.4
Sweden 49,821 0.4
Australia 45,338 0.4
Spain 44,070 0.4
Denmark 40,721 0.3
Norway 37,231 0.3
VALUE PERCENT
------------ -----------
China $ 36,404 0.3%
Finland 35,444 0.3
South Korea 29,198 0.3
Austria 27,473 0.2
Argentina 24,563 0.2
Luxembourg 24,559 0.2
Mexico 20,104 0.1
India 19,131 0.1
Czech Republic 16,266 0.1
New Zealand 15,143 0.1
Belgium 15,019 0.1
Taiwan 10,517 0.1
Chile 9,560 0.1
Brazil 8,042 0.1
Greece 5,485 0.0
------------ -----------
Total Foreign Portfolio $ 1,841,871 15.0%
============ ===========
1-800-922-6769
32
COLUMBIA ACORN INTERNATIONAL
>MAJOR PORTFOLIO CHANGES IN THE SECOND QUARTER (UNAUDITED)
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
ADDITIONS
- ----------------------------------------------------------------------------
EUROPE
>UNITED KINGDOM/IRELAND
Business Post 810,000 1,050,000
Exel 1,500,000 1,750,000
Jardine Lloyd Thompson 800,000 1,593,000
Jurys Doyle Hotel (Ireland) 740,000 810,000
Northgate 0 473,000
Rank Group 0 230,800
RPS Group 5,800,000 6,158,000
Tullow Oil 8,000,000 9,200,000
>NETHERLANDS
Fugro 200,000 278,800
Koninklijke Ten Cate 0 157,947
>GERMANY/AUSTRIA
Wienerberger (Austria) 420,000 472,500
Wincor Nixdorf 0 66,000
>FRANCE
Camaieu 35,000 54,000
Metropole TV 200,000 300,000
>SPAIN
Gamesa 380,000 850,000
Gestevision Telecinco 0 132,000
Prosegur 400,000 550,000
>SWEDEN
Hexagon 293,000 368,000
>ITALY
Amplifon 90,000 216,000
Credit Emiliano 0 210,000
>LUXEMBOURG
SES Global 1,280,000 1,880,000
>CZECH REPUBLIC
Komercni Banka 0 100,000
>POLAND
Central European Distribution 159,900 207,450
(INCLUDES THE EFFECT OF A 3 FOR 2
STOCK SPLIT)
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
- ----------------------------------------------------------------------------
ASIA
>JAPAN
Ain Pharmaciez 0 155,200
Bank of Fukuoka 0 1,500,000
Bank of Yokohama 0 1,400,000
Chiyoda Integre 150,000 234,900
Daito Trust Construction 346,300 480,100
Hogy Medical 186,000 226,000
Olympus Optical 0 325,000
Otsuke Kagu 0 326,900
Sugi Pharmacy 270,000 330,000
Wacoal 0 1,500,000
>HONG KONG/CHINA
Global Bio-Chem Technology
Group (China) 15,842,000 23,000,000
>TAIWAN
ASE Test 1,130,000 1,230,000
Bank of Kaohsiung 5,320,000 7,700,000
Phoenixtec Power 8,539,000 11,540,000
Springsoft Systems 435,000 3,200,000
- ----------------------------------------------------------------------------
OTHER COUNTRIES
>AUSTRALIA
Pacific Brands 0 5,000,000
>SOUTH AFRICA
Edgars Consolidated Stores 0 252,000
- ----------------------------------------------------------------------------
LATIN AMERICA
>MEXICO
URBI Desarrollo 0 690,000
>ARGENTINA
Tenaris 400,000 440,000
>BRAZIL
Natura Cosmetics 0 517,000
33
COLUMBIA ACORN INTERNATIONAL
>MAJOR PORTFOLIO CHANGES IN THE SECOND QUARTER (UNAUDITED),
CONTINUED
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
SALES
- ----------------------------------------------------------------------------
EUROPE
>UNITED KINGDOM/IRELAND
Bunzl 1,400,000 1,000,000
Depfa Bank (Ireland) 1,200,000 1,000,000
(INCLUDES THE EFFECT OF A 10 FOR
1 STOCK SPLIT)
Euro Money Institutional Investor 1,200,000 0
Grafton Group (Ireland) 2,900,000 2,750,000
Hit Entertainment 3,000,000 0
Irish Life & Permanent (Ireland) 800,000 767,600
McCarthy & Stone 450,000 0
>NETHERLANDS
IM Tech 545,000 400,000
Vopak 792,000 581,886
>FRANCE
Essilor International 230,000 140,000
Euronext 300,000 0
Fininfo 476,000 404,000
Groupe Bourbon 40,000 0
Neopost 549,400 429,400
>SWITZERLAND
BKW Energie 15,000 0
Givaudan 25,000 15,000
Kaba Holdings 30,000 0
>SPAIN
Cortefiel 800,000 0
Red Electrica 600,000 420,000
>SWEDEN
Intrum Justitia 2,980,000 2,630,000
Munters 80,000 0
>NORWAY
Orkla 291,000 221,000
>DENMARK
Kobenhavns Lufthavne 100,000 65,000
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
- ----------------------------------------------------------------------------
ASIA
>JAPAN
ARRK 360,000 280,000
Bellsystem 24 35,000 0
Fast Retailing 263,000 220,000
Nissin Healthcare 390,000 0
Park 24 370,000 210,000
Shimano 650,000 442,500
Taisei Lamick 100,000 0
USS 190,000 0
>HONG KONG
Lianhua Supermarket 5,000,000 930,000
TVB 2,000,000 108,300
>INDIA
Gas Authority of India 660,000 0
>THAILAND
Airports of Thailand 1,357,800 0
- ----------------------------------------------------------------------------
OTHER COUNTRIES
>CANADA
Corus Entertainment 825,000 500,000
Nexen 400,000 0
Noranda 500,000 400,000
Patheon 1,112,000 0
Power Financial 200,000 0
Shawcor 392,000 0
1-800-922-6769
34
COLUMBIA ACORN INTERNATIONAL
>STATEMENT OF INVESTMENTS (UNAUDITED), JUNE 30, 2004
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
COMMON STOCKS AND OTHER
EQUITY-LIKE SECURITIES: 96.8%
- ----------------------------------------------------------------------------
EUROPE: 57.0%
>UNITED KINGDOM/IRELAND: 19.0%
2,350,000 Anglo Irish Bank (Ireland) $ 36,812
SMALL BUSINESS & MIDDLE MARKET BANKING
1,750,000 Exel 24,402
GLOBAL LOGISTICS & FREIGHT FORWARDING
1,100,000 Kerry (Ireland) 23,302
FOOD INGREDIENTS
2,750,000 Grafton Group (Ireland) 21,943
BUILDERS, WHOLESALERS & DIY RETAILING
9,200,000 Tullow Oil 20,550
OIL & GAS PRODUCER
1,450,000 Smith & Nephew 15,647
MEDICAL EQUIPMENT & SUPPLIES
600,000 Cobham 15,220
AEROSPACE
1,000,000 Depfa Bank (Ireland) 14,597
INTERNATIONAL PUBLIC SECTOR FINANCE
6,158,000 RPS Group 14,555
ENVIRONMENTAL CONSULTING
1,700,000 Burberry 12,630
APPAREL RETAILER
2,400,000 Expro International 11,981
OFFSHORE OIL FIELD SERVICES
1,593,000 Jardine Lloyd Thompson 11,876
BUSINESS INSURANCE BROKER
767,600 Irish Life & Permanent (Ireland) 11,831
SAVINGS PRODUCTS
1,200,000 Spectris 10,883
ELECTRONIC INSTRUMENTATION & CONTROLS
810,000 Jurys Doyle Hotel (Ireland) 10,264
HOTEL GROUP
750,000 Xstrata 10,049
DIVERSIFIED MINING HOLDING COMPANY
2,950,000 United Drug (Ireland) 10,046
IRISH PHARMACEUTICAL WHOLESALER & OUTSOURCER
500,000 Intermediate Capital 9,815
EUROPEAN PROVIDER OF MEZZANINE CAPITAL
1,050,000 Business Post 9,355
PARCEL & EXPRESS MAIL SERVICE
1,000,000 Bunzl 8,348
DISTRIBUTION OF DISPOSABLE PRODUCTS TO FOOD INDUSTRY
1,000,000 Kensington 7,995
NON-CONFORMING MORTGAGE COMPANY
473,000 Northgate 5,960
LIGHT COMMERCIAL VEHICLE RENTAL SPECIALIST
1,200,000 BBA Group 5,942
AVIATION SUPPORT SERVICES
200,000 Surfcontrol (b) 2,222
INTERNET FILTERING SOFTWARE
230,800 Rank Group 1,258
GAMING & MEDIA SERVICES
- ----------------------------------------------------------------------------
327,483
>NETHERLANDS: 7.4%
278,800 Fugro 17,966
SURVEY & GPS SERVICES
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
327,000 OPG Groep $ 17,502
PHARMACEUTICAL WHOLESALER & RETAILER
353,000 Hunter Douglas 17,186
DECORATIVE WINDOW COVERINGS
569,390 Aalberts Industrie 17,050
FLOW CONTROL & HEAT TREATMENT
684,000 United Services Group 11,161
TEMPORARY STAFFING SERVICES
400,000 IM Tech 10,962
TECHNICAL ENGINEERING
339,928 Sligro Food Group 10,838
FOOD SERVICE & WHOLESALING
581,886 Vopak 9,594
OIL & CHEMICAL STORAGE
157,947 Koninklijke Ten Cate 8,638
ADVANCED TEXTILES & INDUSTRIAL FABRICS
686,111 Am NV 6,428
PROPERTY DEVELOPER
- ----------------------------------------------------------------------------
127,325
>GERMANY/AUSTRIA: 6.9%
315,000 Rhoen-Klinikum Pfd. 17,310
300,000 Rhoen-Klinikum 16,125
HOSPITAL MANAGEMENT
472,500 Wienerberger (Austria) 16,484
BRICKS & CLAY ROOFING TILES
550,000 Hugo Boss Designs 12,467
FASHION APPAREL
300,000 Bilfinger Berger 10,381
CONSTRUCTION & RELATED SERVICES
300,000 Kali & Salz 10,179
POTASH PRODUCTS, FERTILIZERS, SALT & WASTE MANAGEMENT
250,000 GFK 8,734
MARKET RESEARCH SERVICES
1,000,000 Takkt 8,335
MAIL ORDER RETAILER OF OFFICE & WAREHOUSE DURABLES
300,000 Zapf Creation 7,062
TOY MANUFACTURER
75,000 Beru 5,752
AUTO PARTS & ELECTRONICS
66,000 Wincor Nixdorf (b) 3,637
MANUFACTURES ATM MACHINES & RETAIL POS SYSTEMS
260,000 Deutsche Beteiligungs (b) 3,376
PRIVATE EQUITY INVESTMENT MANAGEMENT
- ----------------------------------------------------------------------------
119,842
>FRANCE/BELGIUM: 6.3%
429,400 Neopost 25,411
POSTAGE METERS
244,000 Omega Pharma (Belgium) 12,380
OTC PRODUCTS, PHARMACY & DENTAL SUPPLIES
150,000 Bacou Dalloz 11,136
SAFETY EQUIPMENT
404,000 Fininfo 11,095
DATA FEEDS FOR FRENCH BANKS & BROKERS
160,000 Imerys 9,328
INDUSTRIAL MINERALS PRODUCER
140,000 Essilor International 9,146
EYEGLASS LENSES
90,000 Vallourec 8,847
SEAMLESS TUBES
35
COLUMBIA ACORN INTERNATIONAL
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>FRANCE/BELGIUM--CONTINUED
90,000 Bonduelle $ 8,541
PRODUCER OF CANNED, FROZEN & FRESH VEGETABLES
300,000 Metropole TV 8,481
TELEVISION BROADCASTER
54,000 Camaieu 4,826
WOMEN'S APPAREL RETAILER
- ----------------------------------------------------------------------------
109,191
>SWITZERLAND: 4.6%
25,000 Geberit International 16,666
PLUMBING SUPPLIES
130,000 Synthes-Stratec 14,833
PRODUCTS FOR ORTHOPEDIC SURGERY
24,000 Sika 13,213
CHEMICALS FOR CONSTRUCTION & INDUSTRIAL APPLICATION
40,000 Schindler 11,492
ELEVATOR MANUFACTURER & SERVICE PROVIDER
15,000 Givaudan 8,696
INDUSTRIAL FRAGRANCES & FLAVORS
3,000 Pargesa 8,079
INDUSTRIAL & MEDIA CONGLOMERATE
110,000 Bachem 6,286
PEPTIDES
- ----------------------------------------------------------------------------
79,265
>SPAIN: 3.0%
2,000,000 Abengoa 17,762
ENGINEERING & CONSTRUCTION
850,000 Gamesa 12,554
WIND TURBINES
550,000 Prosegur 8,467
SECURITY GUARDS
420,000 Red Electrica 7,151
SPANISH POWER GRID
120,000 Bankinter 4,573
MORTGAGE LENDER
132,000 Gestevision Telecinco (b) 1,970
SPAIN'S SECOND LARGEST BROADCASTER
- ----------------------------------------------------------------------------
52,477
>SWEDEN: 2.2%
2,630,000 Intrum Justitia (b) 15,394
RECEIVABLES MANAGEMENT & DEBT COLLECTION
368,000 Hexagon 12,371
DIVERSIFIED ENGINEERING
860,000 Nobia 10,130
KITCHEN INTERIORS MANUFACTURING & DISTRIBUTION
- ----------------------------------------------------------------------------
37,895
>ITALY: 2.1%
1,130,000 Autogrill (b) 16,035
RESTAURANTS & CATERING FOR TRAVELERS
212,000 Davide Campari 10,464
BEVERAGES
216,000 Amplifon 7,694
HEARING AID RETAILER
210,000 Credit Emiliano 1,727
REGIONAL BANK
- ----------------------------------------------------------------------------
35,920
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>FINLAND: 1.7%
438,300 Jaakko Poyry $ 11,071
ENGINEERING CONSULTANTS IN FORESTRY, ENERGY
185,000 Amer Group 9,640
BRANDED SPORTING GOODS
950,000 Sponda 8,070
OFFICE & WAREHOUSE PROPERTY COMPANY
- ----------------------------------------------------------------------------
28,781
>NORWAY: 1.0%
1,210,000 Den Norske Bank 8,253
LARGEST NORWEGIAN BANK
221,000 Orkla 5,527
DIVERSIFIED CONSUMER GOODS
220,000 Ekornes 4,312
NICHE FURNITURE MANUFACTURER
- ----------------------------------------------------------------------------
18,092
>LUXEMBOURG: 0.9%
1,880,000 SES Global 15,893
SATELLITE BROADCASTING SERVICES
- ----------------------------------------------------------------------------
>CZECH REPUBLIC: 0.7%
100,000 Komercni Banka 11,218
LEADING CZECH UNIVERSAL BANK
- ----------------------------------------------------------------------------
>DENMARK: 0.5%
65,000 Kobenhavns Lufthavne 9,479
COPENHAGEN AIRPORT AUTHORITY
- ----------------------------------------------------------------------------
>GREECE: 0.4%
465,000 Intralot 7,393
LOTTERY & GAMING SYSTEMS & SERVICES
- ----------------------------------------------------------------------------
>POLAND: 0.3%
207,450 Central European Distribution (b) 5,375
SPIRITS & WINE DISTRIBUTION
- ----------------------------------------------------------------------------
-----------
EUROPE: TOTAL 985,629
- ----------------------------------------------------------------------------
ASIA: 28.9%
>JAPAN: 15.6%
480,100 Daito Trust Construction 18,461
APARTMENT BUILDER
220,000 Fast Retailing 17,876
APPAREL RETAILER
1,500,000 Wacoal 15,947
WOMEN'S SPECIALTY APPAREL
800,000 Ushio 14,474
INDUSTRIAL LIGHT SOURCES
358,000 Eneserve 14,268
POWER GENERATORS
1,181,000 Toyo Technica 13,942
VALUE ADDED RESELLER OF IMPORTED INSTRUMENTATION
201,000 Kappa Create 13,930
201,000 Kappa Create New Shares 13,484
SUSHI CHAIN RESTAURANT OPERATOR
330,000 Sugi Pharmacy 13,506
DRUGSTORES
1-800-922-6769
36
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>JAPAN--CONTINUED
5,200 Dentsu $ 13,440
ADVERTISING AGENCY
817,500 NIFCO 12,936
MOLDED PLASTIC COMPONENTS
280,000 ARRK 12,265
PROTOTYPES & MOLDS FOR NEW PRODUCT DEVELOPMENT
226,000 Hogy Medical 11,359
DISPOSABLE SURGICAL PRODUCTS
75,000 Funai Electric 11,323
CONSUMER ELECTRONICS
442,500 Shimano 10,529
BICYCLE COMPONENTS & FISHING TACKLE
326,900 Otsuke Kagu 10,206
FURNITURE RETAILER
1,500,000 Bank of Fukuoka 8,921
REGIONAL BANK
1,400,000 Bank of Yokohama 8,769
REGIONAL BANK
172,000 Uni-Charm 8,569
INFANT HYGIENE & FEMININE CARE PRODUCTS
210,000 Park 24 7,988
PARKING LOT OPERATOR
234,900 Chiyoda Integre 7,232
PLASTIC COMPONENTS FOR CONSUMER ELECTRONICS
325,000 Olympus Optical 6,158
MEDICAL EQUIPMENT & CAMERAS
155,200 Ain Pharmaciez 2,716
DISPENSING PHARMACY/DRUGSTORE OPERATOR
112,000 Hiroshima Bank 599
REGIONAL BANK
- ----------------------------------------------------------------------------
268,898
>HONG KONG/CHINA: 5.1%
23,000,000 Global Bio-Chem Technology
Group (China) 16,705
1,875,000 Global Bio-Chem Technology
Group Warrant (China) (b) 123
CHINESE REFINER OF CORN-BASED COMMODITIES
6,000,000 Techtronic Industries 9,587
POWER TOOLS
2,000,000 Esprit Holdings 8,992
GLOBAL APPAREL BRAND MANAGER
4,000,000 Hong Kong Exchanges & Clearing 8,246
TRADING, CLEARING & SETTLEMENT SERVICES FOR
FINANCIAL MARKETS
9,815,000 Hainan Meilan Airport (China) 7,507
CHINESE AIRPORT OPERATOR
20,000,000 Sinotrans (China) 7,203
INTEGRATED LOGISTICS IN CHINA
17,674,000 Linmark 6,531
SOURCING OF CONSUMER GOODS
12,000,000 Jiangsu Expressway (China) 5,767
TOLL ROAD BUILDER & OPERATOR
8,000,000 Zhejiang Expressway (China) 5,720
TOLL ROAD BUILDER & OPERATOR
14,500,000 Ngai Lik Industrial 5,562
CHINA BASED ELECTRONICS CONTRACT MANUFACTURER
27,969,225 Lerado Group 4,958
BABY PARAPHERNALIA
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
930,000 Lianhua Supermarket $ 941
Chinese Supermarket Chain
108,300 TVB 467
TELEVISION PROGRAMMING & BROADCASTING
- ----------------------------------------------------------------------------
88,309
>TAIWAN: 2.5%
11,540,000 Phoenixtec Power 11,367
UNINTERRUPTIBLE POWER SUPPLIES
1,230,000 ASE Test (b) 9,065
SEMICONDUCTOR PACKAGING & TEST SERVICES
3,200,000 Springsoft Systems 7,343
ELECTRONIC DESIGN AUTOMATION SOFTWARE
5,000,000 Wah Lee Industrial 6,671
DISTRIBUTOR OF CHEMICALS, MATERIALS & EQUIPMENT
7,700,000 Bank of Kaohsiung 5,473
COMMERCIAL BANKING
3,010,000 Taiwan Fu Hsing 2,783
DOOR LOCK MANUFACTURER
- ----------------------------------------------------------------------------
42,702
>SINGAPORE: 2.3%
1,920,000 Venture 20,184
ELECTRONIC CONTRACT MANUFACTURER
15,000,000 Comfort Group 10,742
TAXI SERVICE
9,000,000 Sembcorp Logistics 9,637
LOGISTIC SERVICES FOR MARINE TRANSPORT
- ----------------------------------------------------------------------------
40,563
>SOUTH KOREA: 2.0%
355,000 Hyundai Mobis 15,815
AUTO PARTS
165,000 Yuhan 10,142
ETHICAL DRUG PRODUCER
100,000 Samsung Fire & Marine 6,410
NON-LIFE INSURANCE
252,100 Samyoung Heat Exchange (b) 2,253
POWER PLANT RELATED MACHINERY
- ----------------------------------------------------------------------------
34,620
>INDIA: 1.0%
1,500,000 Housing Development Finance 16,880
PREMIER MORTGAGE LENDER IN INDIA
- ----------------------------------------------------------------------------
>INDONESIA: 0.3%
40,000,000 PT Perusahaan Gas Negara 6,185
GAS PIPELINE OPERATOR
- ----------------------------------------------------------------------------
>THAILAND: 0.1%
4,000,000 Thai Union Frozen Products 2,005
CANNED TUNA FISH
- ----------------------------------------------------------------------------
-----------
ASIA: TOTAL 500,162
- ----------------------------------------------------------------------------
OTHER COUNTRIES: 7.8%
>CANADA: 3.9%
995,000 Talisman Energy 21,634
OIL & GAS PRODUCER
5,000,000 Esprit Exploration (b) 13,038
NATURAL GAS PRODUCER
37
COLUMBIA ACORN INTERNATIONAL
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>CANADA--CONTINUED
500,000 Corus Entertainment $ 9,694
TELEVISION PROGRAMMING & RADIO STATIONS
340,000 Masonite International (b) 8,769
DOOR MANUFACTURER
450,000 Intrawest 7,178
OWNER/OPERATOR OF SKI RESORTS
400,000 Noranda 6,856
DIVERSIFIED NON-FERROUS METALS MINER
- ----------------------------------------------------------------------------
67,169
>AUSTRALIA/NEW ZEALAND: 3.6%
3,000,000 Billabong International 17,219
SURFWEAR APPAREL MANUFACTURER
4,000,000 Sky City Entertainment (New Zealand) 12,114
CASINO/ENTERTAINMENT COMPLEX
2,500,000 Lion Nathan 11,778
AUSTRALIAN BEER BREWER/DISTRIBUTOR
350,000 Perpetual Trustees 11,429
AUSTRALIAN MUTUAL FUND MANAGER
5,000,000 Pacific Brands (b) 9,274
DOMINANT AUSTRALIAN APPAREL BRAND MANAGER
- ----------------------------------------------------------------------------
61,814
>SOUTH AFRICA: 0.3%
252,000 Edgars Consolidated Stores 5,986
LEADING RETAIL CONGLOMERATE
- ----------------------------------------------------------------------------
-----------
OTHER: TOTAL 134,969
- ----------------------------------------------------------------------------
LATIN AMERICA: 3.1%
>MEXICO: 1.4%
660,000 Grupo Aeroportuario 12,210
MEXICAN AIRPORT AUTHORITY
3,000,000 Consorcio (b) 8,634
LOW/MEDIUM INCOME HOUSE BUILDER
690,000 URBI Desarrollo (b) 2,228
AFFORDABLE HOUSING BUILDER
- ----------------------------------------------------------------------------
23,072
NUMBER OF SHARES OR
PRINCIPAL AMOUNT (000) VALUE (000)
- ----------------------------------------------------------------------------
>ARGENTINA: 0.8%
440,000 Tenaris $ 14,410
STEEL PIPE FOR OIL WELLS & PIPELINES
- ----------------------------------------------------------------------------
>BRAZIL: 0.5%
517,000 Natura Cosmetics (b) 8,315
DIRECT SALES OF HIGH-END COSMETICS
- ----------------------------------------------------------------------------
>CHILE: 0.4%
300,000 CorpBanca (c) 7,170
CHILE'S 3RD LARGEST LOCAL BANK
- ----------------------------------------------------------------------------
-----------
LATIN AMERICA: TOTAL 52,967
TOTAL COMMON STOCKS AND OTHER
-----------
EQUITY-LIKE SECURITIES: 96.8% 1,673,727
(COST: $1,193,325)
- ----------------------------------------------------------------------------
SHORT-TERM OBLIGATIONS: 3.2%
Yield 1.17% - 1.22%
Due 7/6/04 - 7/7/04
$ 30,000 SBC International 29,995
25,000 American General Finance 24,995
- ----------------------------------------------------------------------------
(AMORTIZED COST: $54,990) 54,990
-----------
TOTAL INVESTMENTS (d): 100.0% 1,728,717
(COST: $1,248,315) (a)
CASH AND OTHER ASSETS LESS LIABILITIES: 0.0% (531)
-----------
TOTAL NET ASSETS: 100% $ 1,728,186
============================================================================
- --------------------------------------------------------------------------------
>NOTES TO STATEMENT OF INVESTMENTS (IN THOUSANDS)
(a) At June 30, 2004, for federal income tax purpose cost of investments was
$1,249,530 and net unrealized appreciation was $479,187 consisting of gross
unrealized appreciation of $512,988 and gross unrealized depreciation of
$33,801.
(b) Non-income producing security.
(c) Denotes a restricted security, which is subject to restrictions on resale
under federal securities laws. This security amounted to $7,170, which
represents 0.40% of total net assets.
Additional information on this security is as follows:
ACQUISITION
SECURITY DATE SHARES (000) COST (000) VALUE (000)
- -------------- ----------- ----------- --------- ----------
CorpBanca 11/19/03 300 $ 7,564 $ 7,170
(d) On June 30, 2004, the Fund's total investments were denominated in
currencies as follows:
CURRENCY VALUE % OF NET ASSETS
-------- ---------- ----------------
Euro $ 625,619 36.2%
Japanese Yen 268,898 15.6
British Pounds 198,688 11.5
US Dollar 103,220 5.9
Hong Kong Dollar 88,309 5.1
Other currencies less than
5% of total net assets 443,983 25.7
---------- ----------------
$1,728,717 100.0%
========== ================
1-800-922-6769
38
COLUMBIA ACORN INTERNATIONAL
>PORTFOLIO DIVERSIFICATION (UNAUDITED)
At June 30, 2004, the Fund's portfolio investments as a percent of net assets
was diversified as follows:
VALUE (000) PERCENT
- ----------------------------------------------------------------------------
>INDUSTRIAL GOODS/SERVICES
Other Industrial Services $ 103,277 5.8%
Industrial Materials 81,897 4.7
Outsourcing and
Training Services 61,139 3.5
Conglomerates 55,262 3.2
Electrical Components 49,480 2.9
Construction 37,728 2.2
Machinery 27,664 1.6
Steel 23,257 1.3
Industrial Distribution 21,943 1.3
Specialty Chemicals 21,909 1.3
- ----------------------------------------------------------------------------
480,556 27.8
>CONSUMER GOODS/SERVICES
Retail 85,373 4.9
Apparels 61,438 3.6
Food 50,213 2.9
Restaurants 43,449 2.5
Furniture and Textiles 40,397 2.3
Durables Goods 25,868 1.5
Beverage 22,242 1.3
Leisure Products 17,955 1.0
Travel 17,442 1.0
Casinos 13,372 0.8
Other Consumer Services 12,946 0.8
Consumer Electronics 11,323 0.7
Nondurables 8,569 0.5
Gaming 7,393 0.4
Other Entertainment 7,062 0.4
Consumer Goods Distribution 5,375 0.3
- ----------------------------------------------------------------------------
430,417 24.9
>FINANCE
Banks 103,539 6.0
Other Finance Companies 39,164 2.3
Insurance 30,117 1.7
Savings and Loans 21,453 1.2
Money Management 14,805 0.9
- ----------------------------------------------------------------------------
209,078 12.1
VALUE (000) PERCENT
- ----------------------------------------------------------------------------
>INFORMATION TECHNOLOGY
Business Information and
Marketing Services $ 34,384 2.0%
Contract Manufacturing 25,746 1.5
Instrumentation 24,825 1.4
Satellite Broadcasting Services 15,893 0.9
Computer Hardware and
Related Equipment 15,004 0.9
Advertising 13,440 0.8
Television Broadcasting 10,918 0.6
Television Programming 9,694 0.6
Business Software 9,565 0.5
Semiconductors and
Related Equipment 9,065 0.5
Financial Processors 8,246 0.5
Electronics Distribution 6,671 0.4
- ----------------------------------------------------------------------------
183,451 10.6
>HEALTH CARE
Medical Equipment 45,784 2.6
Hospital Management 33,435 1.9
Services 29,882 1.7
Pharmaceuticals 20,188 1.2
Hospital/ Laboratory Supplies 11,359 0.7
Biotechnology/ Drug Delivery 6,286 0.4
- ----------------------------------------------------------------------------
146,934 8.5
>ENERGY/MINERALS
Oil/Gas Producers 55,222 3.2
Oil Services 29,947 1.7
Agricultural Commodities 16,828 1.0
Independent Power 14,268 0.8
Non-Ferrous Metals 10,049 0.6
Mining 6,856 0.4
Refining/Marketing/Distribution 6,185 0.4
- ----------------------------------------------------------------------------
139,355 8.1
>OTHER INDUSTRIES
Transportation 51,425 3.0
Real Estate 25,360 1.4
Regulated Utilities 7,151 0.4
- ----------------------------------------------------------------------------
83,936 4.8
TOTAL COMMON STOCKS AND ----------------------------
OTHER EQUITY-LIKE SECURITIES 1,673,727 96.8
SHORT-TERM OBLIGATIONS 54,990 3.2
----------------------------
TOTAL INVESTMENTS 1,728,717 100.0
CASH AND OTHER ASSETS
LESS LIABILITIES (531) 0.0
----------------------------
NET ASSETS $ 1,728,186 100.0%
============================================================================
39
COLUMBIA ACORN USA
>MAJOR PORTFOLIO CHANGES IN THE SECOND QUARTER (UNAUDITED)
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
ADDITIONS
- ----------------------------------------------------------------------------
INFORMATION
Entravision Communications 0 510,000
Unova 180,000 260,000
ValueClick 140,000 285,000
- ----------------------------------------------------------------------------
CONSUMER GOODS/SERVICES
Aeropostale 290,500 435,750
Ann Taylor 75,000 187,500
(INCLUDES THE EFFECT OF A 3 FOR 2
STOCK SPLIT)
Brookstone 12,750 129,900
(INCLUDES THE EFFECT OF A 3 FOR 2
STOCK SPLIT)
HNI 0 40,000
ITT Educational Services 376,000 396,000
NBTY 0 37,000
Sports Authority 0 70,000
Weight Watchers 0 60,000
- ----------------------------------------------------------------------------
HEALTH CARE
Atherogenics 0 260,000
Diagnostic Products 66,300 141,300
Lexicon Genetics 0 281,200
Ligand Pharmaceuticals 0 415,000
Par Pharmaceuticals 0 192,000
- ----------------------------------------------------------------------------
ENERGY/MINERALS
Chicago Bridge & Iron 0 160,000
Clayton Williams Energy 0 95,000
Oneok 95,000 245,000
Range Resources 0 73,000
- ----------------------------------------------------------------------------
INDUSTRIAL GOODS/SERVICES
Genlyte Group 0 17,000
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
SALES
- ----------------------------------------------------------------------------
INFORMATION
DoubleClick 925,600 460,600
Kronos 331,650 296,650
Micros Systems 347,600 287,600
Telephone & Data Systems 40,000 10,000
Zebra Technologies 186,000 166,000
- ----------------------------------------------------------------------------
HEALTH CARE
Applera Celera Genomics 245,000 0
Enzon 311,500 0
Nektar Therapeutics 720,000 360,000
- ----------------------------------------------------------------------------
INDUSTRIAL GOODS/SERVICES
Insurance Auto Auctions 206,900 41,900
1-800-922-6769
40
COLUMBIA ACORN USA
>STATEMENT OF INVESTMENTS (UNAUDITED), JUNE 30, 2004
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
COMMON STOCKS: 92.0%
- ----------------------------------------------------------------------------
INFORMATION: 33.9%
>BUSINESS/CONSUMER SOFTWARE: 9.9%
287,600 Micros Systems (b) $ 13,796
INFORMATION SYSTEMS FOR RESTAURANTS & HOTELS
974,000 JDA Software (b) 12,828
APPLICATIONS/SOFTWARE & SERVICES FOR RETAILERS
296,650 Kronos (b) 12,222
LABOR MANAGEMENT SOLUTIONS
1,330,000 Novell (b) 11,159
DIRECTORY, OPERATING SYSTEM & IDENTITY
MANAGEMENT SOFTWARE
473,500 MRO Software (b) 6,444
ENTERPRISE MAINTENANCE SOFTWARE
304,991 PeopleSoft (b) 5,642
HR, ERP, CRM & SUPPLY CHAIN SOFTWARE
206,000 Group 1 Software (b) 4,728
ADDRESS VERIFICATION SOFTWARE
653,200 E.Piphany (b) 3,155
CRM SOFTWARE
140,000 SPSS (b) 2,516
STATISTICAL ANALYSIS SOFTWARE
64,000 THQ (b) 1,466
ENTERTAINMENT SOFTWARE
100,000 Aspect Communications (b) 1,420
CALL CENTER SOFTWARE
65,000 MAPICS (b) 686
MID MARKET ERP SOFTWARE
- ----------------------------------------------------------------------------
76,062
>COMPUTER HARDWARE/SEMICONDUCTORS/
RELATED EQUIPMENT: 6.1%
166,000 Zebra Technologies (b) 14,442
BAR CODE PRINTERS
365,300 Integrated Circuit Systems (b) 9,922
SILICON TIMING DEVICES
424,100 Seachange International (b) 7,159
SYSTEMS FOR VIDEO ON DEMAND & AD INSERTION
260,000 Unova (b) 5,265
BARCODE & WIRELESS LAN SYSTEMS
70,000 Littelfuse (b) 2,969
LITTLE FUSES
40,000 Rogers (b) 2,796
PCB LAMINATES & HIGH PERFORMANCE FOAMS
200,000 Cable Design Technologies (b) 2,120
NETWORKING & SPECIALTY CABLES
50,000 Avocent (b) 1,837
COMPUTER CONTROL SWITCHES
- ----------------------------------------------------------------------------
46,510
>MOBILE COMMUNICATIONS: 5.5%
927,000 Western Wireless (b) 26,800
RURAL CELLULAR PHONE SERVICES
1,005,000 Crown Castle International (b) 14,824
COMMUNICATION TOWERS IN USA & UK
10,000 Telephone & Data Systems 712
CELLULAR & TELEPHONE SERVICES
- ----------------------------------------------------------------------------
42,336
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>TELECOMMUNICATIONS/WIRELINE
COMMUNICATIONS: 3.2%
333,800 Commonwealth Telephone (b) $ 14,944
RURAL PHONE FRANCHISES & CLEC
480,000 Andrew (b) 9,605
WIRELESS INFRASTRUCTURE EQUIPMENT
- ----------------------------------------------------------------------------
24,549
>BROADCASTING: 2.7%
315,800 Salem Communications (b) 8,568
RADIO STATIONS FOR RELIGIOUS PROGRAMMING
695,000 Spanish Broadcasting (b) 6,470
SPANISH LANGUAGE RADIO STATIONS
510,000 Entravision Communications (b) 3,917
SPANISH LANGUAGE TV, RADIO & OUTDOOR
138,500 Gray Television 1,924
MID MARKET AFFILIATED TV STATIONS
- ----------------------------------------------------------------------------
20,879
>TRANSACTION PROCESSORS: 1.7%
211,640 Global Payments 9,528
CREDIT CARD PROCESSOR
143,100 Pegasus Systems (b) 1,878
TRANSACTION PROCESSOR FOR HOTEL INDUSTRY
80,000 Euronet Worldwide (b) 1,850
ATM PROCESSOR
- ----------------------------------------------------------------------------
13,256
>COMPUTER SERVICES: 1.5%
1,005,500 AnswerThink Consulting (b) 5,761
IT INTEGRATOR FOR FORTUNE 2000
786,000 RCM Technologies (b)(c) 4,990
TECHNOLOGY ENGINEERING SERVICES
200,000 Igate Capital (b) 796
TECHNOLOGY STAFFING SERVICES
- ----------------------------------------------------------------------------
11,547
>INTERNET: 0.9%
460,600 DoubleClick (b) 3,579
INTERNET ADVERTISING & DIRECT MARKETING
STATISTICAL DATA
285,000 ValueClick (b) 3,414
INTERNET ADVERTISING
- ----------------------------------------------------------------------------
6,993
>BUSINESS INFORMATION/MARKETING
SERVICES/PUBLISHING: 0.8%
102,800 Getty Images (b) 6,168
PHOTOGRAPHS FOR PUBLICATIONS & ELECTRONIC MEDIA
- ----------------------------------------------------------------------------
>TELEVISION PROGRAMMING: 0.6%
600,000 Mediacom Communications (b) 4,692
CABLE TELEVISION FRANCHISES
- ----------------------------------------------------------------------------
>TELECOMMUNICATION EQUIPMENT: 0.4%
300,000 Symmetricom (b) 2,670
NETWORK TIMING & SYNCHRONIZATION DEVICES
- ----------------------------------------------------------------------------
>INSTRUMENTATION: 0.3%
90,000 Trimble Navigation (b) 2,501
GPS-BASED INSTRUMENTS
- ----------------------------------------------------------------------------
41
COLUMBIA ACORN USA
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>Contract Manufacturing: 0.3%
140,000 Plexus (b) $ 1,890
ELECTRONIC MANUFACTURING SERVICES
- ----------------------------------------------------------------------------
-----------
INFORMATION: TOTAL 260,053
- ----------------------------------------------------------------------------
CONSUMER GOODS/SERVICES: 15.4%
>RETAIL: 7.0%
435,750 Aeropostale (b) 11,726
MALL BASED TEEN RETAILER
116,600 Urban Outfitters (b) 7,102
MULTI CHANNEL LIFESTYLE RETAILER
343,750 Christopher & Banks 6,088
WOMEN'S APPAREL RETAILER
187,500 Ann Taylor (b) 5,434
WOMEN'S APPAREL RETAILER
710,000 Winn Dixie Stores 5,112
SUPERMARKETS IN THE SOUTHEAST US
130,000 Abercrombie & Fitch 5,037
TEEN APPAREL RETAILER
95,000 Petco Animal Supplies (b) 3,060
PET SUPPLIES & SERVICES
50,000 Michaels Stores 2,750
CRAFT & HOBBY SPECIALTY RETAILER
129,900 Brookstone (b) 2,604
SPECIALTY CONSUMER PRODUCT RETAILER
70,000 Sports Authority (b) 2,513
SPORTING GOODS STORES
95,000 Genesco (b) 2,245
MULTI-CONCEPT BRANDED FOOTWEAR RETAILER
- ----------------------------------------------------------------------------
53,671
>CONSUMER SERVICES: 4.0%
396,000 ITT Educational Services (b) 15,056
TECHNOLOGY-ORIENTED POST SECONDARY DEGREE PROGRAMS
435,000 Coinstar (b) 9,557
OWNER/OPERATOR OF COIN COUNTING MACHINES
181,700 Central Parking 3,396
OWNER, OPERATOR & MANAGER OF PARKING LOTS & GARAGES
60,000 Weight Watchers 2,348
WEIGHT LOSS PROGRAMS
- ----------------------------------------------------------------------------
30,357
>NONDURABLES: 1.4%
167,200 Scotts Company (b) 10,681
CONSUMER LAWN & GARDEN PRODUCTS
- ----------------------------------------------------------------------------
>APPAREL: 1.2%
197,600 Steven Madden (b) 3,946
WHOLESALER/RETAILER OF FASHION FOOTWEAR
64,000 Coach (b) 2,892
DESIGNER & RETAILER OF BRANDED LEATHER ACCESSORIES
59,200 Oxford Industries 2,579
BRANDED & PRIVATE LABEL APPAREL
- ----------------------------------------------------------------------------
9,417
>FURNITURE: 1.0%
85,000 Herman Miller 2,460
OFFICE FURNITURE
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
30,000 American Woodmark $ 1,795
KITCHEN CABINETS
40,000 HNI 1,693
OFFICE FURNITURE & FIREPLACES
20,000 Mohawk Industries (b) 1,467
CARPET & FLOORING
- ----------------------------------------------------------------------------
7,415
>ENTERTAINMENT/LEISURE PRODUCTS: 0.7%
91,300 International Speedway Motors 4,441
LARGEST MOTORSPORT RACETRACK OWNER & OPERATOR
50,000 Leapfrog Enterprises (b) 994
EDUCATIONAL TOYS
- ----------------------------------------------------------------------------
5,435
>FOOD & BEVERAGES: 0.1%
37,000 NBTY (b) 1,087
VITAMINS & SUPPLEMENTS
- ----------------------------------------------------------------------------
-----------
CONSUMER GOODS/SERVICES: TOTAL 118,063
- ----------------------------------------------------------------------------
HEALTH CARE: 15.1%
>MEDICAL EQUIPMENT: 6.5%
573,000 Edwards Lifesciences (b) 19,970
HEART VALVES
415,000 Ligand Pharmaceuticals (b) 7,213
DRUGS FOR PAIN, CANCER, OSTEOPOROSIS, & DIABETES
141,300 Diagnostic Products 6,209
IMMUNODIAGNOSTIC KITS
220,000 Viasys Healthcare (b) 4,600
RESPIRATORY & NEUROLOGY MEDICAL EQUIPMENT
170,600 VISX (b) 4,558
LASER EYE SURGERY
111,700 ICU Medical (b) 3,745
INTRAVENOUS THERAPY PRODUCTS
245,000 CTI Molecular Imaging (b) 3,474
MEDICAL DIAGNOSTIC DEVICES
- ----------------------------------------------------------------------------
49,769
>SERVICES: 4.3%
744,000 First Health (b) 11,614
PPO NETWORK
423,800 NDCHealth Group 9,832
HEALTH CLAIMS PROCESSING & DRUG MARKETING SERVICES
246,800 Lincare Holdings (b) 8,110
HOME HEALTH CARE SERVICES
40,000 Charles River Laboratories (b) 1,955
PHARMACEUTICAL RESEARCH
100,000 Dendrite International (b) 1,858
SOFTWARE FOR PHARMACEUTICAL SALES FORCE
- ----------------------------------------------------------------------------
33,369
>BIOTECHNOLOGY/DRUG DELIVERY: 3.0%
360,000 Nektar Therapeutics (b) 7,186
DRUG DELIVERY TECHNOLOGIES
192,000 Par Pharmaceuticals (b) 6,760
GENERICS
260,000 Atherogenics (b) 4,948
DRUGS FOR ATHEROSCLEROSIS, RHEUMATOID ARTHRITIS,
ASTHMA
1-800-922-6769
42
NUMBER OF SHARES VALUE (000)
- --------------------------------------------------------------------------------
>BIOTECHNOLOGY/DRUG DELIVERY--CONTINUED
281,200 Lexicon Genetics (b) $ 2,205
DRUG DISCOVERY
154,000 SYRRX, Series C (b)(d) 770
X-RAY CRYSTALLOGRAPHY
375,000 Locus Discovery, Series D, Pfd. (b)(d) 750
HIGH THROUGHPUT RATIONAL DRUG DESIGN
75,000 Bioveris (b) 624
IMMUNODIAGNOSTIC TECHNOLOGY
363,636 Metabolex, Series F (b)(d) 53
DRUGS FOR DIABETES
- ----------------------------------------------------------------------------
23,296
>MEDICAL SUPPLIES: 1.3%
222,800 Techne (b) 9,681
CYTOKINES, ANTIBODIES, OTHER REAGENTS FOR LIFE SCIENCES
- ----------------------------------------------------------------------------
-----------
Health Care: Total 116,115
- ----------------------------------------------------------------------------
ENERGY/MINERALS: 10.3%
>OIL & GAS PRODUCERS: 4.6%
305,000 Quicksilver (b) 20,456
NATURAL GAS & COAL SEAM GAS PRODUCER
272,000 Western Gas 8,835
OIL & COAL SEAM GAS PRODUCER
82,100 Southwestern Energy (b) 2,354
NATURAL GAS PRODUCER
95,000 Clayton Williams Energy (b) 2,270
OIL & GAS PRODUCER
73,000 Range Resources 1,066
OIL & GAS PRODUCER
43,300 McMoRan Exploration (b) 675
NATURAL GAS PRODUCERS & LNG DEVELOPER
- ----------------------------------------------------------------------------
35,656
>OIL SERVICES: 3.6%
401,700 FMC Technologies (b) 11,569
OIL & GAS WELL HEAD MANUFACTURER
941,000 Newpark Resources (b) 5,834
DRILLING FLUID SERVICES TO OIL & GAS INDUSTRY
160,000 Chicago Bridge & Iron 4,456
ENGINEERING & CONSTRUCTION FOR PETROCHEMICALS & LNG
61,000 Carbo Ceramics 4,163
NATURAL GAS WELL STIMULANTS
135,000 Key Energy Services (b) 1,274
OIL & GAS WELL WORKOVER SERVICES
- ----------------------------------------------------------------------------
27,296
>DISTRIBUTION/MARKETING/REFINING: 2.1%
115,600 Equitable Resources 5,978
NATURAL GAS UTILITY & PRODUCER
245,000 Oneok 5,388
NATURAL GAS UTILITY, MARKETING & PROCESSING
193,000 Atmos Energy 4,941
NATURAL GAS UTILITY
- ----------------------------------------------------------------------------
16,307
-----------
Energy/Minerals: Total 79,259
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
FINANCE: 9.8%
>FINANCE COMPANIES: 4.0%
1,091,500 AmeriCredit (b) $ 21,317
AUTO LENDING
520,200 World Acceptance (b) 9,535
PERSONAL LOANS
- ----------------------------------------------------------------------------
30,852
>INSURANCE: 2.9%
430,000 HCC Insurance Holdings 14,367
AVIATION INSURANCE
16,500 Markel (b) 4,579
SPECIALTY INSURANCE
35,000 Philadelphia Consolidated Holding (b) 2,102
SPECIALTY INSURANCE
91,000 United National Group (b) 1,375
SPECIALTY INSURANCE
- ----------------------------------------------------------------------------
22,423
>BANKS: 1.7%
131,500 TCF Financial 7,634
GREAT LAKES BANK
158,125 Chittenden 5,558
VERMONT & WEST MASSACHUSETTS BANK
- ----------------------------------------------------------------------------
13,192
>SAVINGS & LOAN: 1.2%
110,000 Downey Financial 5,857
CALIFORNIA HOME LENDER
116,400 Anchor Bancorp Wisconsin 3,078
WISCONSIN THRIFT
- ----------------------------------------------------------------------------
8,935
-----------
FINANCE: TOTAL 75,402
- ----------------------------------------------------------------------------
INDUSTRIAL GOODS/SERVICES: 6.7%
>MACHINERY: 3.3%
282,000 Esco Technologies (b) 15,047
FILTRATION & TEST EQUIPMENT
194,000 Pentair 6,526
PUMPS, WATER TREATMENT & TOOLS
110,000 Ametek 3,399
AEROSPACE/INDUSTRIAL INSTRUMENTS
- ----------------------------------------------------------------------------
24,972
>LOGISTICS: 1.3%
286,000 Hub Group (b) 9,753
TRUCK & RAIL FREIGHT FORWARDER
- ----------------------------------------------------------------------------
>WATER: 0.9%
134,000 Cuno (b) 7,149
FILTRATION & FLUIDS CLARIFICATION
- ----------------------------------------------------------------------------
>INDUSTRIAL SERVICES: 0.3%
95,000 Clark/Bardes Consulting (b) 1,762
EXECUTIVE COMPENSATION & BENEFITS CONSULTING
41,900 Insurance Auto Auctions (b) 712
AUTO SALVAGE SERVICES
- ----------------------------------------------------------------------------
2,474
43
COLUMBIA ACORN USA
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>SPECIALTY CHEMICALS/INDUSTRIAL
MATERIALS: 0.3%
95,000 Spartech $ 2,464
PLASTICS DISTRIBUTION & COMPOUNDING
- ----------------------------------------------------------------------------
>INDUSTRIAL DISTRIBUTION: 0.3%
100,000 Nuco2 (b) 1,970
BULK CO2 GAS DISTRIBUTION TO RESTAURANTS
- ----------------------------------------------------------------------------
>CONSTRUCTION: 0.2%
45,000 Florida Rock Industries 1,898
CONCRETE & AGGREGATES
- ----------------------------------------------------------------------------
>INDUSTRIAL GOODS: 0.1%
17,000 Genlyte Group (b) 1,069
COMMERCIAL LIGHTING FIXTURES
- ----------------------------------------------------------------------------
-----------
Industrial Goods/Services: Total 51,749
- ----------------------------------------------------------------------------
OTHER INDUSTRIES: 0.8%
>REAL ESTATE: 0.6%
47,000 The Rouse Company 2,232
REGIONAL SHOPPING MALLS
100,000 Crescent Real Estate Equities 1,612
CLASS A OFFICE BUILDINGS
35,000 Highland Hospitality (b) 352
HOTEL REAL ESTATE INVESTMENT TRUST
- ----------------------------------------------------------------------------
4,196
>REGULATED UTILITIES: 0.2%
90,000 Northeast Utilities 1,752
REGULATED ELECTRIC UTILITY
- ----------------------------------------------------------------------------
-----------
Other Industries: Total 5,948
-----------
Total Common Stocks: 92.0% 706,589
(Cost: $486,876)
PRINCIPAL AMOUNT (000) VALUE (000)
- ----------------------------------------------------------------------------
SHORT-TERM OBLIGATIONS: 8.0%
Yield 1.12% - 1.17%
Due 7/6/04 - 7/7/04
$ 20,000 SBC International $ 19,997
20,000 Prudential Funding 19,996
21,514 Repurchase Agreement with
State Street Bank & Trust
Dated 6/30/04, Due 7/01/04
at 1.30% Collateralized by
Federal Home Loan Mortgage
Corporation Notes, Maturing
2/15/05, Market Value $21,945
(Repurchase proceeds: $21,515) 21,514
- ----------------------------------------------------------------------------
(AMORTIZED COST: $61,507) 61,507
-----------
TOTAL INVESTMENTS: 100.0% 768,096
(COST: $548,383) (a)
CASH AND OTHER ASSETS LESS LIABILITIES: 0.0% (180)
-----------
TOTAL NET ASSETS: 100% $ 767,916
============================================================================
1-800-922-6769
44
- --------------------------------------------------------------------------------
>NOTES TO STATEMENT OF INVESTMENTS (IN THOUSANDS)
(a) At June 30, 2004, for federal income tax purposes cost of investments was
the same and net unrealized appreciation was $219,713 consisting of gross
unrealized appreciation of $242,584 and gross unrealized depreciation of
$22,871.
(b) Non-income producing security.
(c) An affiliate may include any company in which the Fund owns five percent or
more of its outstanding voting securities. On June 30, 2004, the Fund held
five percent or more of the outstanding voting securities of the following
company:
RCM Technologies 6.95%
The aggregate cost and value of this company at June 30, 2004, was $5,636
and $4,990 respectively. Investments in affiliate companies represent 0.65%
of total net assets at June 30, 2004. Investment activity and income amounts
relating to affiliates during the six months ended June 30, 2004 were as
follows:
Dividend Income $ --
Net realized gain or loss $ (3,800)
Change in unrealized gain or loss $ (2,712)
Purchases $ --
Proceeds from sales $ 562
(d) Denotes a restricted security, which is subject to restrictions on resale
under federal securities laws. These securities are valued in good faith by
the Board of Trustees. At June 30, 2004, these securities amounted to
$1,573, which represents 0.20% of total net assets.
Additional information on these securities is as follows:
ACQUISITION
SECURITY DATES SHARES (000) COST (000) VALUE (000)
- -------- ----------- ----------- --------- ----------
SYRRX, Series C 01/08/01 154 $1,101 $770
Locus Discovery, Series D, Pfd. 09/05/01 375 1,500 750
Metabolex, Series F 05/11/00 364 2,000 53
--------- ----------
$4,601 $1,573
========= ==========
45
COLUMBIA ACORN INTERNATIONAL SELECT
>MAJOR PORTFOLIO CHANGES IN THE SECOND QUARTER (UNAUDITED)
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
ADDITIONS
- ----------------------------------------------------------------------------
EUROPE
>UNITED KINGDOM
British Sky Broadcasting 35,000 70,000
Exel 80,000 135,000
>CZECH REPUBLIC
Komercni Banka 0 12,000
- ----------------------------------------------------------------------------
ASIA
>JAPAN
Daito Trust Construction 26,100 38,000
Olympus Optical 0 23,000
Sugi Pharmacy 23,000 32,300
Uni-Charm 20,500 25,100
- ----------------------------------------------------------------------------
OTHER COUNTRIES
>CANADA
Kinross Gold 0 80,000
- ----------------------------------------------------------------------------
LATIN AMERICA
>ARGENTINA
Tenaris 19,200 39,200
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
Sales
- ----------------------------------------------------------------------------
EUROPE
>UNITED KINGDOM
BG Group 350,000 270,000
>FRANCE
Essilor International 18,000 12,000
Neopost 33,600 25,100
>SWEDEN
Gambro 58,000 0
- ----------------------------------------------------------------------------
ASIA
>JAPAN
Fast Retailing 19,500 11,500
Nidec 12,900 0
USS 11,700 0
>HONG KONG/CHINA
Esprit Holdings 200,000 0
Sinotrans (China) 2,000,000 0
- ----------------------------------------------------------------------------
OTHER COUNTRIES
>CANADA
Power Financial 20,000 0
Talisman Energy 72,000 52,000
(includes the effect of a 3 for 1
stock split)
1-800-922-6769
46
COLUMBIA ACORN INTERNATIONAL SELECT
>STATEMENT OF INVESTMENTS (UNAUDITED) JUNE 30, 2004
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
COMMON STOCKS: 96.8%
- ----------------------------------------------------------------------------
EUROPE: 56.3%
>UNITED KINGDOM/IRELAND: 29.7%
161,486 Anglo Irish Bank (Ireland) $ 2,530
SMALL BUSINESS & MIDDLE MARKET BANKING
135,000 Exel 1,882
GLOBAL LOGISTICS & FREIGHT FORWARDING
270,000 BG Group 1,667
OIL & GAS PRODUCER
88,000 Depfa Bank (Ireland) 1,285
INTERNATIONAL PUBLIC SECTOR FINANCE
40,000 Cobham 1,015
AEROSPACE
120,000 Grafton Group (Ireland) 957
BUILDERS, WHOLESALERS & DIY RETAILING
70,000 British Sky Broadcasting (b) 792
DIGITAL SATELLITE BROADCASTING
100,000 Jardine Lloyd Thompson 745
BUSINESS INSURANCE BROKER
120,000 Compass Group 735
INTERNATIONAL CONCESSION & CONTRACT CATERER
75,000 Burberry 557
APPAREL RETAILER
25,000 Kerry (Ireland) 530
FOOD INGREDIENTS
46,000 Smith & Nephew 496
MEDICAL EQUIPMENT & SUPPLIES
15,400 Rank Group 84
GAMING & MEDIA SERVICES
- ----------------------------------------------------------------------------
13,275
>SWITZERLAND: 7.2%
4,000 Schindler 1,149
ELEVATOR MANUFACTURER & SERVICE PROVIDER
7,000 Swatch Group 913
WATCH & ELECTRONICS MANUFACTURER
1,000 Givaudan 580
INDUSTRIAL FRAGRANCES & FLAVORS
5,000 Synthes-Stratec 570
PRODUCTS FOR ORTHOPEDIC SURGERY
- ----------------------------------------------------------------------------
3,212
>FRANCE: 6.1%
25,100 Neopost 1,485
POSTAGE METERS
12,000 Essilor International 784
EYEGLASS LENSES
8,000 Imerys 466
INDUSTRIAL MINERALS PRODUCER
- ----------------------------------------------------------------------------
2,735
>NORWAY: 3.2%
209,500 Den Norske Bank 1,429
LARGEST NORWEGIAN BANK
- ----------------------------------------------------------------------------
>CZECH REPUBLIC: 3.0%
12,000 Komercni Banka 1,346
LEADING CZECH UNIVERSAL BANK
- ----------------------------------------------------------------------------
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>GERMANY: 2.5%
20,000 Rhoen-Klinikum $ 1,099
HOSPITAL MANAGEMENT
- ----------------------------------------------------------------------------
>SPAIN: 1.8%
43,000 Red Electrica 732
SPANISH POWER GRID
6,000 Gestevis Telecino (b) 90
SPAIN'S SECOND LARGEST BROADCASTER
- ----------------------------------------------------------------------------
822
>LUXEMBOURG: 1.7%
90,000 SES Global 761
SATELLITE BROADCASTING SERVICES
- ----------------------------------------------------------------------------
>ITALY: 1.1%
34,000 Autogrill (b) 482
RESTAURANTS & CATERING FOR TRAVELERS
- ----------------------------------------------------------------------------
-----------
Europe: Total 25,161
- ----------------------------------------------------------------------------
ASIA: 29.4%
>JAPAN: 25.8%
9,700 Funai Electric 1,464
CONSUMER ELECTRONICS
38,000 Daito Trust Construction 1,461
APARTMENT BUILDER
32,300 Sugi Pharmacy 1,322
DRUGSTORES
12,400 Hoya 1,301
OPTO-ELECTRICAL COMPONENTS & EYEGLASS LENSES
71,000 Ushio 1,285
INDUSTRIAL LIGHT SOURCES
25,100 Uni-Charm 1,251
INFANT HYGIENE & FEMININE CARE PRODUCTS
51,500 Shimano 1,225
BICYCLE COMPONENTS & FISHING TACKLE
11,500 Fast Retailing 934
APPAREL RETAILER
310 Dentsu 801
ADVERTISING AGENCY
23,000 Olympus Optical 436
MEDICAL EQUIPMENT & CAMERAS
11,000 Hiroshima Bank 59
REGIONAL BANK
- ----------------------------------------------------------------------------
11,539
>SINGAPORE: 2.0%
83,000 Venture 873
ELECTRONIC CONTRACT MANUFACTURER
- ----------------------------------------------------------------------------
>HONG KONG: 1.6%
500,000 Li & Fung 733
SOURCING OF CONSUMER GOODS
- ----------------------------------------------------------------------------
-----------
ASIA: TOTAL 13,145
47
COLUMBIA ACORN INTERNATIONAL SELECT
>STATEMENT OF INVESTMENTS (UNAUDITED)C0UNTIED
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
OTHER COUNTRIES: 8.2%
>CANADA: 5.5%
52,000 Talisman Energy $ 1,131
OIL & GAS PRODUCER
50,000 Noranda 857
DIVERSIFIED NON-FERROUS METALS MINER
80,000 Kinross Gold (b) 444
GOLD MINING
- ----------------------------------------------------------------------------
2,432
>AUSTRALIA: 2.7%
260,000 Lion Nathan 1,225
BEER BREWER/DISTRIBUTOR
- ----------------------------------------------------------------------------
-----------
OTHER COUNTRIES: TOTAL 3,657
- ----------------------------------------------------------------------------
LATIN AMERICA: 2.9%
>ARGENTINA: 2.9%
39,200 Tenaris 1,284
STEEL PIPE FOR OIL WELLS & PIPELINES
- ----------------------------------------------------------------------------
-----------
LATIN AMERICA: TOTAL 1,284
-----------
TOTAL COMMON STOCKS: 96.8% 43,247
(COST: $32,172)
PRINCIPAL AMOUNT(000) VALUE (000)
- ----------------------------------------------------------------------------
SHORT-TERM OBLIGATIONS: 3.7%
$1,663 Repurchase Agreement with
State Street Bank & Trust
Dated 6/30/04, Due 7/01/04
at 1.30% Collateralized by
Federal Home Loan Mortgage
Corporation Notes, Maturing
2/15/05, Market Value $1,698
(Repurchase proceeds: $1,663) $1,663
- ----------------------------------------------------------------------------
(COST: $1,663) 1,663
-----------
TOTAL INVESTMENTS (C): 100.5% 44,910
(COST: $33,835) (A)
CASH AND OTHER ASSETS LESS LIABILITIES: (0.5%) (208)
-----------
TOTAL NET ASSETS: 100% $44,702
============================================================================
- --------------------------------------------------------------------------------
>NOTES TO STATEMENT OF INVESTMENTS (IN THOUSANDS)
(a) At June 30, 2004, for federal income tax purpose cost of investments was
the same and net unrealized appreciation was $11,075 consisting of gross
unrealized appreciation of $11,840 and gross unrealized depreciation of
$765.
(b) Non-income producing security.
(c) On June 30, 2004, the Fund's total investments were denominated in
currencies as follows:
CURRENCY VALUE % OF NET ASSETS
================================================================
Japanese Yen $ 11,539 25.8%
Euro 11,201 25.1
British Pounds 7,974 17.8
Swiss Franc 3,212 7.2
US Dollar 2,946 6.6
Canadian Dollar 2,432 5.5
Other currencies less
than 5% of total
net assets 5,606 12.5
--------- ---------------
$ 44,910 100.5%
========= ===============
1-800-922-6769
48
COLUMBIA ACORN INTERNATIONAL SELECT
>PORTFOLIO DIVERSIFICATION (UNAUDITED)
At June 30, 2004, the Fund's portfolio investments as a percent of net assets
was diversified as follows:
VALUE (000) PERCENT
- ----------------------------------------------------------------------------
>INDUSTRIAL GOODS/SERVICES
Other Industrial Services $3,031 6.8%
Electrical Components 2,300 5.2
Machinery 1,485 3.3
Construction 1,461 3.3
Steel 1,284 2.9
Industrial Distribution 957 2.1
Outsourcing and Training Services 733 1.6
Specialty Chemicals 580 1.3
Industrial Materials 466 1.0
- ----------------------------------------------------------------------------
12,297 27.5
>CONSUMER GOODS/SERVICES
Retail 2,813 6.3
Durable Goods 2,138 4.8
Consumer Electronics 1,464 3.3
Nondurables 1,251 2.8
Beverage 1,225 2.7
Restaurants 1,217 2.7
Food 530 1.2
Casinos 84 0.2
- ----------------------------------------------------------------------------
10,722 24.0
>FINANCE
Banks 6,649 14.9
Insurance 745 1.7
- ----------------------------------------------------------------------------
7,394 16.6
VALUE (000) PERCENT
- ----------------------------------------------------------------------------
>INFORMATION TECHNOLOGY
Semiconductors and
Related Equipment $1,301 2.9%
Television Broadcasting 882 2.0
Contract Manufacturing 873 1.9
Advertising 801 1.8
Satellite Broadcasting Services 761 1.7
- ----------------------------------------------------------------------------
4,618 10.3
>ENERGY/MINERALS
Oil/Gas Producers 2,798 6.3
Mining 857 1.9
Non-Ferrous Metals 444 1.0
- ----------------------------------------------------------------------------
4,099 9.2
>HEALTH CARE
Medical Equipment 2,286 5.1
Hospital Management 1,099 2.5
- ----------------------------------------------------------------------------
3,385 7.6
>OTHER INDUSTRIES
Regulated Utilities 732 1.6
- ----------------------------------------------------------------------------
732 1.6
----------------------------
TOTAL COMMON STOCKS 43,247 96.8
SHORT-TERM OBLIGATIONS 1,663 3.7
----------------------------
TOTAL INVESTMENTS 44,910 100.5
CASH AND OTHER ASSETS
LESS LIABILITIES (208) (0.5)
----------------------------
NET ASSETS $44,702 100.0%
============================================================================
49
COLUMBIA ACORN SELECT
>MAJOR PORTFOLIO CHANGES IN THE SECOND QUARTER (UNAUDITED)
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
ADDITIONS
- ----------------------------------------------------------------------------
INFORMATION
McAfee 2,200,000 2,750,000
PeopleSoft 1,800,000 2,135,000
Skillsoft Publishing 0 2,063,700
Tellabs 0 3,400,000
- ----------------------------------------------------------------------------
CONSUMER GOODS/SERVICES
Abercrombie & Fitch 660,000 855,000
Safeway 1,050,000 1,500,000
- ----------------------------------------------------------------------------
FINANCE
SEI Investments 600,000 729,500
- ----------------------------------------------------------------------------
HEALTH CARE
Lincare Holdings 660,000 835,000
NUMBER OF SHARES
----------------------------
03/31/04 06/30/04
SALES
- ----------------------------------------------------------------------------
CONSUMER GOODS/SERVICES
Weight Watchers 1,040,000 728,000
- ----------------------------------------------------------------------------
FINANCE
TCF Financial 1,160,000 985,000
- ----------------------------------------------------------------------------
HEALTH CARE
Guidant 355,000 0
- ----------------------------------------------------------------------------
INDUSTRIAL GOODS/SERVICES
Expeditors International of
Washington 720,000 620,000
1-800-922-6769
50
COLUMBIA ACORN SELECT
>STATEMENT OF INVESTMENTS (UNAUDITED) JUNE 30, 2004
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
COMMON STOCKS: 90.5%
- ----------------------------------------------------------------------------
INFORMATION: 34.0%
>BUSINESS SOFTWARE: 12.8%
2,750,000 McAfee (b) $49,858
SECURITY SOFTWARE & SERVICES
2,135,000 PeopleSoft (b) 39,498
HR, ERP, CRM & SUPPLY CHAIN SOFTWARE
1,300,000 Synopsys (b) 36,959
SOFTWARE FOR DESIGNING SEMICONDUCTOR CHIPS
- ----------------------------------------------------------------------------
126,315
>BUSINESS INFORMATION: 6.1%
470,000 Moody's 30,390
CREDIT RATING SERVICE
900,000 Fair Isaac 30,042
CREDIT SCORING & DECISION ANALYTIC SOFTWARE
- ----------------------------------------------------------------------------
60,432
>ADVERTISING: 3.8%
2,700,000 Interpublic Group (b) 37,071
ADVERTISING
- ----------------------------------------------------------------------------
>INSTRUMENTATION: 3.4%
1,000,000 Tektronix 34,020
ANALYTICAL INSTRUMENTS
- ----------------------------------------------------------------------------
>CONSUMER SOFTWARE: 3.3%
600,000 Electronic Arts (b) 32,730
ENTERTAINMENT SOFTWARE
- ----------------------------------------------------------------------------
>TELECOMMUNICATION EQUIPMENT: 3.0%
3,400,000 Tellabs (b) 29,716
TELECOMMUNICATIONS & CABLE EQUIPMENT
- ---------------------------------------------------------------------------
>INTERNET: 1.6%
2,063,700 Skillsoft Publishing (b) 15,684
PROVIDER OF WEB-BASED LEARNING SOLUTIONS
(E-LEARNING)
- ----------------------------------------------------------------------------
-----------
INFORMATION: TOTAL 335,968
- ----------------------------------------------------------------------------
CONSUMER GOODS/SERVICES: 32.8%
>RETAIL: 10.3%
1,500,000 Safeway (b) 38,010
RETAIL FOOD & DRUG STORES
855,000 Abercrombie & Fitch 33,131
TEEN APPAREL RETAILER
750,000 Costco 30,802
WAREHOUSE SUPERSTORES
- ----------------------------------------------------------------------------
101,943
>CONSUMER SERVICES: 7.7%
1,250,000 ITT Educational Services (b) 47,525
TECHNOLOGY-ORIENTED POST SECONDARY DEGREE PROGRAMS
728,000 Weight Watchers (b) 28,494
WEIGHT LOSS PROGRAMS
- ----------------------------------------------------------------------------
76,019
NUMBER OF SHARES VALUE (000)
- ----------------------------------------------------------------------------
>FURNITURE & MANUFACTURERS: 6.3%
1,160,000 Herman Miller $33,570
OFFICE FURNITURE
630,000 Coach (b) 28,470
DESIGNER & RETAILER OF BRANDED LEATHER ACCESSORIES
- ----------------------------------------------------------------------------
62,040
>LEISURE VEHICLES: 6.3%
1,000,000 Harley-Davidson 61,940
MOTORCYCLES & RELATED MERCHANDISE
- ----------------------------------------------------------------------------
>ENTERTAINMENT: 2.2%
460,000 International Speedway Motors 22,374
LARGEST MOTORSPORT RACETRACK OWNER & OPERATOR
- ----------------------------------------------------------------------------
-----------
CONSUMER GOODS/SERVICES: TOTAL 324,316
- ----------------------------------------------------------------------------
FINANCE: 13.5%
>BANKS: 8.0%
985,000 TCF Financial 57,179
GREAT LAKES BANK
750,000 Associated Banc-Corp 22,223
MIDWEST BANK
- ----------------------------------------------------------------------------
79,402
>INSURANCE: 3.4%
120,000 Markel (b) 33,300
SPECIALTY INSURANCE
- ----------------------------------------------------------------------------
>MONEY MANAGEMENT: 2.1%
729,500 SEI Investments 21,185
MUTUAL FUND ADMINISTRATION & INVESTMENT MANAGEMENT
- ----------------------------------------------------------------------------
-----------
FINANCE: TOTAL 133,887
- ----------------------------------------------------------------------------
HEALTH CARE: 7.1%
>SERVICES: 7.1%
2,750,000 First Health (b) 42,928
PPO NETWORK
835,000 Lincare Holdings (b) 27,438
HOME HEALTH CARE SERVICES
- ----------------------------------------------------------------------------
70,366
-----------
HEALTH CARE: TOTAL 70,366
- ----------------------------------------------------------------------------
INDUSTRIAL GOODS/SERVICES: 3.1%
>LOGISTICS: 3.1%
620,000 Expeditors International of
Washington 30,634
INTERNATIONAL FREIGHT FORWARDER
-----------
INDUSTRIAL GOODS/SERVICES: TOTAL 30,634
-----------
TOTAL COMMON STOCKS: 90.5% 895,171
(COST: $768,527)
51
COLUMBIA ACORN SELECT
>STATEMENT OF INVESTMENTS (UNAUDITED), CONTINUED
PRINCIPAL AMOUNT (000) VALUE (000)
- ----------------------------------------------------------------------------
SHORT-TERM OBLIGATIONS: 9.6%
Yield 1.00% - 1.30%
Due 7/1/04 - 7/8/04
$35,000 Virginia Electric $ 34,991
30,000 Prudential Funding 29,999
25,000 Coca Cola Enterprises 25,000
4,668 Repurchase Agreement with
State Street Bank & Trust
Dated 6/03/04, Due 7/01/04
at 1.30% Collateralized by
Federal Home Loan Mortgage
Corporation Notes, Maturing
2/15/05, Market Value $4,765
(Repurchase proceeds: $4,668) 4,668
- ----------------------------------------------------------------------------
(AMORTIZED COST: $94,658) 94,658
-----------
TOTAL INVESTMENTS: 100.1% 989,829
(COST: $863,185) (A)
CASH AND OTHER ASSETS LESS LIABILITIES: (0.1%) (848)
-----------
TOTAL NET ASSETS: 100% $ 988,981
- ----------------------------------------------------------------------------
>NOTES TO STATEMENT OF INVESTMENTS (IN THOUSANDS)
(a) At June 30, 2004, for federal income tax purposes cost of investments was
the same and net unrealized appreciation was $126,644, consisting of gross
unrealized appreciation of $158,975 and gross unrealized depreciation of
$32,331.
(b) Non-income producing security.
1-800-922-6769
52
COLUMBIA ACORN FAMILY OF FUNDS
> STATEMENTS OF ASSETS AND LIABILITIES
> STATEMENTS OF OPERATIONS
> STATEMENTS OF CHANGES IN NET ASSETS
> FINANCIAL HIGHLIGHTS
> NOTES TO FINANCIAL STATEMENTS
53
COLUMBIA ACORN FAMILY OF FUNDS
>STATEMENTS OF ASSETS AND LIABILITIES (UNAUDITED)
COLUMBIA COLUMBIA COLUMBIA
ACORN ACORN ACORN
JUNE 30, 2004 FUND INTERNATIONAL USA
- ------------- -------------------- ------------------- -----------------
(IN THOUSANDS)
ASSETS
Unaffiliated investments, at Cost $ 6,441,885 $ 1,248,315 $ 542,747
Affiliated investments, at Cost (See Note 4) 1,459,400 -- 5,636
-------------------- ------------------- -----------------
Unaffiliated investments, at Value $ 10,223,691 $ 1,728,717 $ 763,106
Affiliated investments, at Value (See Note 4) 2,055,516 -- 4,990
Cash -- -- 1
Foreign currency (cost: Columbia Acorn
Fund $12,413; Columbia Acorn
International $3,802; Columbia Acorn
International Select $94) 12,404 3,794 --
Receivable for:
Investments sold 11,447 21,118 --
Fund shares sold 25,309 928 1,378
Dividends and interest 6,289 3,910 92
Expense reimbursement due from Advisor -- -- --
Deferred Trustees' Compensation Investments 1,155 440 79
Other assets 691 612 89
-------------------- ------------------- -----------------
Total Assets 12,336,502 1,759,519 769,735
LIABILITIES
Payable to custodian bank -- 18,587 --
Payable for:
Investments purchased 30,626 6,414 17
Fund shares redeemed 11,305 5,528 1,562
Custodian -- -- 2
Management fee -- 3 --
12b-1 Service & Distribution fees 2,661 71 118
Legal & audit fees 37 -- --
Reports to shareholders -- -- --
Deferred Trustees' fees 1,155 440 79
Transfer agent fees 441 99 41
Trustees' fees -- -- --
Registration & blue sky fees 60 16 --
Foreign capital gains tax 667 175 --
-------------------- ------------------- -----------------
Total Liabilities 46,952 31,333 1,819
-------------------- ------------------- -----------------
NET ASSETS $ 12,289,550 $ 1,728,186 $ 767,916
==================== =================== =================
COMPOSITION OF NET ASSETS
Paid in capital $ 7,481,497 $ 1,386,259 $ 555,632
Undistributed net investment income
(Accumulated net investment loss) 9,339 13,761 (3,256)
Accumulated net realized gain (loss) 421,428 (150,889) (4,173)
Net unrealized appreciation (depreciation) on:
Investments (net of unrealized PFIC
gains of $1,215 for Columbia Acorn
International) 4,377,922 479,187 219,713
Foreign currency transactions 31 43 --
Foreign capital gains tax (667) (175) --
-------------------- ------------------- -----------------
NET ASSETS $ 12,289,550 $ 1,728,186 $ 767,916
==================== =================== =================
Net asset value per share--
Class A (a) $ 24.11 $ 24.20 $ 22.74
(Net assets/shares) ($2,317,581/96,128) ($55,692/2,302) ($103,174/4,538)
Maximum offering price
per share-- Class A (b) $ 25.58 $ 25.68 $ 24.13
(Net asset value per share/
front-end sales charge) ($24.11/0.9425) ($24.20/0.9425) ($22.74/0.9425)
Net asset value and offering
price per share-- Class B (a) $ 23.54 $ 23.81 $ 22.23
(Net assets/shares) ($1,302,614/55,347) ($45,081/1,894) ($70,114/3,153)
Net asset value and offering
price per share-- Class C (a) $ 23.54 $ 23.82 $ 22.25
(Net assets/shares) ($981,925/41,721) ($25,023/1,051) ($38,992/1,753)
Net asset value, offering and
redemption price per share--
Class Z $ 24.56 $ 24.39 $ 23.08
(Net assets/shares) ($7,687,430/313,049) ($1,602,390/65,709) ($555,636/24,074)
COLUMBIA COLUMBIA
ACORN ACORN
JUNE 30, 2004 INTERNATIONAL SELECT SELECT
- ------------- -------------------- -------------------
(IN THOUSANDS)
ASSETS
Unaffiliated investments, at Cost $ 33,835 $ 863,185
Affiliated investments, at Cost (See Note 4) -- --
-------------------- -------------------
Unaffiliated investments, at Value $ 44,910 $ 989,829
Affiliated investments, at Value (See Note 4) -- --
Cash -- 1
Foreign currency (cost: Columbia Acorn
Fund $12,413; Columbia Acorn
International $3,802; Columbia Acorn
International Select $94) 93 --
Receivable for:
Investments sold 29 --
Fund shares sold 83 4,435
Dividends and interest 46 84
Expense reimbursement due from Advisor 8 --
Deferred Trustees' Compensation Investments -- --
Other assets 1 72
-------------------- -------------------
Total Assets 45,170 994,421
LIABILITIES
Payable to custodian bank -- --
Payable for:
Investments purchased 392 3,225
Fund shares redeemed 28 1,791
Custodian -- 2
Management fee -- --
12b-1 Service & Distribution fees 5 326
Legal & audit fees 8 11
Reports to shareholders 11 --
Deferred Trustees' fees -- --
Transfer agent fees 9 79
Trustees' fees 1 --
Registration & blue sky fees 14 6
Foreign capital gains tax -- --
-------------------- -------------------
Total Liabilities 468 5,440
-------------------- -------------------
NET ASSETS $ 44,702 $ 988,981
==================== ===================
COMPOSITION OF NET ASSETS
Paid in capital $ 67,136 $ 819,743
Undistributed net investment income
(Accumulated net investment loss) 41 (4,253)
Accumulated net realized gain (loss) (33,551) 46,847
Net unrealized appreciation (depreciation) on:
Investments (net of unrealized PFIC
gains of $1,215 for Columbia Acorn
International) 11,075 126,644
Foreign currency transactions 1 --
Foreign capital gains tax -- --
-------------------- -------------------
NET ASSETS $ 44,702 $ 988,981
==================== ===================
Net asset value per share--
Class A (a) $ 15.50 $ 19.30
(Net assets/shares) ($3,194/206) ($384,079/19,897)
Maximum offering price
per share-- Class A (b) $ 16.45 $ 20.48
(Net asset value per share/
front-end sales charge) ($15.50/0.9425) ($19.30/0.9425)
Net asset value and offering
price per share-- Class B (a) $ 15.12 $ 18.84
(Net assets/shares) ($3,928/260) ($156,718/8,320)
Net asset value and offering
price per share-- Class C (a) $ 15.15 $ 18.84
(Net assets/shares) ($2,094/138) ($89,703/4,762)
Net asset value, offering and
redemption price per share--
Class Z $ 15.63 $ 19.55
(Net assets/shares) ($35,486/2,271) ($358,481/18,336)
(a) Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
(b) On sales of $50,000 or more the offering price is reduced.
See accompanying notes to financial statements.
1-800-922-6769
54
COLUMBIA ACORN FAMILY OF FUNDS
>STATEMENTS OF OPERATIONS (UNAUDITED)
FOR THE SIX MONTHS ENDED JUNE 30, 2004
COLUMBIA COLUMBIA COLUMBIA
ACORN ACORN ACORN
(IN THOUSANDS) FUND INTERNATIONAL USA
- -------------- -------------------- ------------------- -----------------
INVESTMENT INCOME:
Dividend income $ 62,690 $ 26,029 $ 1,080
Dividend income from affiliates (See Note 4) 3,333 -- --
Interest income 3,970 231 255
-------------------- ------------------- -----------------
69,993 26,260 1,335
Foreign taxes withheld (3,122) (2,608) (1)
-------------------- ------------------- -----------------
Total Investment Income 66,871 23,652 1,334
EXPENSES:
Management fee 38,885 7,073 3,299
Administration fee 2,939 430 181
12b-1 Service and Distribution fees:
Class A 3,815 98 171
Class B 6,333 214 343
Class C 4,738 124 189
Transfer agent fees:
Class A 1,663 53 83
Class B 1,571 76 88
Class C 1,019 30 39
Class Z 1,421 591 119
Custody fees 634 520 16
Trustees' fees 209 34 13
Registration & blue sky fees 302 49 55
Reports to shareholders 834 148 87
Legal & audit fees 669 75 29
Non-recurring costs (See Note 7) 135 20 8
Other expenses 118 21 7
-------------------- ------------------- -----------------
Total expenses 65,285 9,556 4,727
Less custody fees paid indirectly (16) --* (1)
Less reimbursement of expenses by Advisor (647) (93) (36)
Non-recurring costs reimbursed (See Note 7) (135) (20) (8)
-------------------- ------------------- -----------------
Net Expenses 64,487 9,443 4,682
-------------------- ------------------- -----------------
Net Investment Income (Loss) 2,384 14,209 (3,348)
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON PORTFOLIO POSITIONS:
Net realized gain (loss) on:
Unaffiliated investments 362,021 87,220 12,979
Affiliated investments (See Note 4) 62,019 -- (3,800)
Foreign currency transactions (41) 416 --
-------------------- ------------------- -----------------
Net realized gain 423,999 87,636 9,179
==================== =================== =================
Net change in net unrealized appreciation/
depreciation on:
Unaffiliated investments 553,555 40,841 64,025
Affiliated investments (See Note 4) 4,005 -- (2,712)
Foreign currency transactions 1,560 518 --
Foreign capital gains tax (667) (175) --
-------------------- ------------------- -----------------
Net change in unrealized appreciation/
depreciation 558,453 41,184 61,313
==================== =================== =================
Net realized and unrealized gain 982,452 128,820 70,492
-------------------- ------------------- -----------------
Net Increase in Net Assets resulting
from Operations $ 984,836 $ 143,029 $ 67,144
==================== =================== =================
COLUMBIA COLUMBIA
ACORN ACORN
(IN THOUSANDS) INTERNATIONAL SELECT SELECT
- -------------- -------------------- -------------------
INVESTMENT INCOME:
Dividend income $ 458 $ 2,238
Dividend income from affiliates (See Note 4) -- --
Interest income 7 427
-------------------- -------------------
465 2,665
Foreign taxes withheld (48) --
-------------------- -------------------
Total Investment Income 417 2,665
EXPENSES:
Management fee 210 4,008
Administration fee 11 223
12b-1 Service and Distribution fees:
Class A 5 583
Class B 17 700
Class C 17 397
Transfer agent fees:
Class A 4 283
Class B 9 214
Class C 4 101
Class Z 33 162
Custody fees 22 13
Trustees' fees 3 8
Registration & blue sky fees 38 113
Reports to shareholders 31 113
Legal & audit fees 12 34
Non-recurring costs (See Note 7) 1 10
Other expenses 3 9
-------------------- -------------------
Total expenses 420 6,971
Less custody fees paid indirectly --* --*
Less reimbursement of expenses by Advisor (58) (64)
Non-recurring costs reimbursed (See Note 7) (1) (10)
-------------------- -------------------
Net Expenses 361 6,897
-------------------- -------------------
Net Investment Income (Loss) 56 (4,232)
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON PORTFOLIO POSITIONS:
Net realized gain (loss) on:
Unaffiliated investments 4,798 47,083
Affiliated investments (See Note 4) -- --
Foreign currency transactions (3) --
-------------------- -------------------
Net realized gain 4,795 47,083
==================== ===================
Net change in net unrealized appreciation/
depreciation on:
Unaffiliated investments (1,679) 16,432
Affiliated investments (See Note 4) -- --
Foreign currency transactions (13) --
Foreign capital gains tax -- --
-------------------- -------------------
Net change in unrealized appreciation/
depreciation (1,692) 16,432
==================== ===================
Net realized and unrealized gain 3,103 63,515
-------------------- -------------------
Net Increase in Net Assets resulting
from Operations $ 3,159 $ 59,283
==================== ===================
* Rounds to less than $500.
See accompanying notes to financial statements.
55
COLUMBIA ACORN FAMILY OF FUNDS
>STATEMENTS OF CHANGES IN NET ASSETS
COLUMBIA COLUMBIA ACORN
ACORN FUND INTERNATIONAL
(UNAUDITED) (UNAUDITED)
SIX MONTHS YEAR ENDED SIX MONTHS YEAR ENDED
INCREASE (DECREASE) IN NET ASSETS ENDED JUNE 30, DECEMBER 31, ENDED JUNE 30, DECEMBER 31,
- --------------------------------- -------------- -------------- -------------- --------------
(IN THOUSANDS) 2004 2003 2004 2003
OPERATIONS:
Net investment income (loss) $ 2,384 $ (9,911) $ 14,209 $ 15,934
Net realized gain (loss) on investments
and foreign currency transactions 423,999 90,682 87,636 (7,144)
Net change in net unrealized appreciation
(depreciation) of investments and foreign
currency transactions 558,453 2,974,675 41,184 561,990
-------------- -------------- -------------- --------------
Net Increase from Operations 984,836 3,055,446 143,029 570,780
DISTRIBUTION TO SHAREHOLDERS FROM:
Net investment income -- Class A -- -- (356) (106)
Net realized gain -- Class A (2,709) (1,752) -- --
Net investment income -- Class B -- -- (75) --
Net realized gain -- Class B (1,570) (1,116) -- --
Net investment income -- Class C -- -- (42) --
Net realized gain -- Class C (1,182) (813) -- --
Net investment income -- Class Z -- -- (16,468) (5,829)
Net realized gain -- Class Z (8,844) (6,236) -- --
-------------- -------------- -------------- --------------
Total Distribution to Shareholders (14,305) (9,917) (16,941) (5,935)
SHARE TRANSACTIONS:
Subscriptions -- Class A 394,994 1,041,782 9,334 45,279
Distributions reinvested -- Class A 2,456 1,584 288 80
Redemptions -- Class A (237,930) (259,438) (10,981) (42,948)
-------------- -------------- -------------- --------------
Net Increase (Decrease) -- Class A 159,520 783,928 (1,359) 2,411
Subscriptions -- Class B 55,758 364,144 5,820 11,463
Distributions reinvested -- Class B 1,433 1,018 66 --
Redemptions -- Class B (75,752) (88,744) (3,800) (5,639)
-------------- -------------- -------------- --------------
Net Increase (Decrease) -- Class B (18,561) 276,418 2,086 5,824
Subscriptions -- Class C 77,410 375,513 4,006 14,870
Distributions reinvested -- Class C 972 673 35 --
Redemptions -- Class C (70,493) (73,548) (3,818) (13,396)
-------------- -------------- -------------- --------------
Net Increase (Decrease) -- Class C 7,889 302,638 223 1,474
Subscriptions -- Class Z 873,722 1,682,204 95,148 220,802
Distributions reinvested -- Class Z 7,792 5,443 14,698 5,336
Redemptions -- Class Z (880,158) (667,986) (187,093) (434,204)
-------------- -------------- -------------- --------------
Net Increase (Decrease) -- Class Z 1,356 1,019,661 (77,247) (208,066)
-------------- -------------- -------------- --------------
Net Increase (Decrease) from
Share Transactions 150,204 2,382,645 (76,297) (198,357)
-------------- -------------- -------------- --------------
Redemption Fees -- -- 63 400
-------------- -------------- -------------- --------------
Total Increase in Net Assets 1,120,735 5,428,174 49,854 366,888
NET ASSETS:
Beginning of period 11,168,815 5,740,641 1,678,332 1,311,444
-------------- -------------- -------------- --------------
End of period $ 12,289,550 $ 11,168,815 $ 1,728,186 $ 1,678,332
============== ============== ============== ==============
UNDISTRIBUTED NET INVESTMENT INCOME
(ACCUMULATED NET INVESTMENT LOSS) $ 9,339 $ 6,955 $ 13,761 $ 16,493
============== ============== ============== ==============
COLUMBIA COLUMBIA ACORN
ACORN USA INTERNATIONAL SELECT
(UNAUDITED) (UNAUDITED)
SIX MONTHS YEAR ENDED SIX MONTHS YEAR ENDED
INCREASE (DECREASE) IN NET ASSETS ENDED JUNE 30, DECEMBER 31, ENDED JUNE 30, DECEMBER 31,
- --------------------------------- -------------- -------------- -------------- --------------
(IN THOUSANDS) 2004 2003 2004 2003
OPERATIONS:
Net investment income (loss) $ (3,348) $ (4,408) $ 56 $ 136
Net realized gain (loss) on investments
and foreign currency transactions 9,179 7,301 4,795 (425)
Net change in net unrealized appreciation
(depreciation) of investments and foreign
currency transactions 61,313 172,313 (1,692) 12,936
-------------- -------------- -------------- --------------
Net Increase from Operations 67,144 175,206 3,159 12,647
DISTRIBUTION TO SHAREHOLDERS FROM:
Net investment income -- Class A -- -- (6) --
Net realized gain -- Class A -- -- -- --
Net investment income -- Class B -- -- -- --
Net realized gain -- Class B -- -- -- --
Net investment income -- Class C -- -- -- --
Net realized gain -- Class C -- -- -- --
Net investment income -- Class Z -- -- (151) (19)
Net realized gain -- Class Z -- -- -- --
-------------- -------------- -------------- --------------
Total Distribution to Shareholders -- -- (157) (19)
SHARE TRANSACTIONS:
Subscriptions -- Class A 17,327 60,457 821 2,350
Distributions reinvested -- Class A -- -- 5 --
Redemptions -- Class A (12,605) (23,188) (380) (3,212)
-------------- -------------- -------------- --------------
Net Increase (Decrease) -- Class A 4,722 37,269 446 (862)
Subscriptions -- Class B 3,084 19,327 762 1,577
Distributions reinvested -- Class B -- -- -- --
Redemptions -- Class B (5,153) (8,053) (239) (989)
-------------- -------------- -------------- --------------
Net Increase (Decrease) -- Class B (2,069) 11,274 523 588
Subscriptions -- Class C 3,376 13,056 445 3,211
Distributions reinvested -- Class C -- -- -- --
Redemptions -- Class C (3,355) (4,575) (2,222) (3,564)
-------------- -------------- -------------- --------------
Net Increase (Decrease) -- Class C 21 8,481 (1,777) (353)
Subscriptions -- Class Z 116,241 221,496 2,488 23,389
Distributions reinvested -- Class Z -- -- 146 18
Redemptions -- Class Z (111,417) (83,975) (3,534) (25,393)
-------------- -------------- -------------- --------------
Net Increase (Decrease) -- Class Z 4,824 137,521 (900) (1,986)
-------------- -------------- -------------- --------------
Net Increase (Decrease) from
Share Transactions 7,498 194,545 (1,708) (2,613)
-------------- -------------- -------------- --------------
Redemption Fees -- -- 2 39
-------------- -------------- -------------- --------------
Total Increase in Net Assets 74,642 369,751 1,296 10,054
NET ASSETS:
Beginning of period 693,274 323,523 43,406 33,352
-------------- -------------- -------------- --------------
End of period $ 767,916 $ 693,274 $ 44,702 $ 43,406
============== ============== ============== ==============
UNDISTRIBUTED NET INVESTMENT INCOME
(ACCUMULATED NET INVESTMENT LOSS) $ (3,256) $ 92 $ 41 $ 142
============== ============== ============== ==============
COLUMBIA
ACORN SELECT
(UNAUDITED)
SIX MONTHS YEAR ENDED
INCREASE (DECREASE) IN NET ASSETS ENDED JUNE 30, DECEMBER 31,
- --------------------------------- -------------- --------------
(IN THOUSANDS) 2004 2003
OPERATIONS:
Net investment income (loss) $ (4,232) $ (4,419)
Net realized gain (loss) on investments
and foreign currency transactions 47,083 8,643
Net change in net unrealized appreciation
(depreciation) of investments and foreign
currency transactions 16,432 95,023
-------------- --------------
Net Increase from Operations 59,283 99,247
DISTRIBUTION TO SHAREHOLDERS FROM:
Net investment income -- Class A -- --
Net realized gain -- Class A -- (1,172)
Net investment income -- Class B -- --
Net realized gain -- Class B -- (563)
Net investment income -- Class C -- --
Net realized gain -- Class C -- (301)
Net investment income -- Class Z -- --
Net realized gain -- Class Z -- (2,145)
-------------- --------------
Total Distribution to Shareholders -- (4,181)
SHARE TRANSACTIONS:
Subscriptions -- Class A 147,794 237,520
Distributions reinvested -- Class A -- 1,096
Redemptions -- Class A (50,572) (30,378)
-------------- --------------
Net Increase (Decrease) -- Class A 97,222 208,238
Subscriptions -- Class B 39,146 78,641
Distributions reinvested -- Class B -- 507
Redemptions -- Class B (9,370) (9,321)
-------------- --------------
Net Increase (Decrease) -- Class B 29,776 69,827
Subscriptions -- Class C 28,340 50,838
Distributions reinvested -- Class C -- 257
Redemptions -- Class C (7,816) (4,391)
-------------- --------------
Net Increase (Decrease) -- Class C 20,524 46,704
Subscriptions -- Class Z 110,515 301,467
Distributions reinvested -- Class Z -- 1,920
Redemptions -- Class Z (68,958) (150,913)
-------------- --------------
Net Increase (Decrease) -- Class Z 41,557 152,474
-------------- --------------
Net Increase (Decrease) from
Share Transactions 189,079 477,243
-------------- --------------
Redemption Fees -- --
-------------- --------------
Total Increase in Net Assets 248,362 572,309
NET ASSETS:
Beginning of period 740,619 168,310
-------------- --------------
End of period $ 988,981 $ 740,619
============== ==============
UNDISTRIBUTED NET INVESTMENT INCOME
(ACCUMULATED NET INVESTMENT LOSS) $ (4,253) $ (21)
============== ==============
See accompanying notes to financial statements.
1-800-922-6769
56-57 Spread
COLUMBIA ACORN FAMILY OF FUNDS
>STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
COLUMBIA COLUMBIA ACORN
ACORN FUND INTERNATIONAL
(UNAUDITED) (UNAUDITED)
SIX MONTHS YEAR ENDED SIX MONTHS YEAR ENDED
CHANGES IN SHARES OF BENEFICIAL INTEREST: ENDED JUNE 30, DECEMBER 31, ENDED JUNE 30, DECEMBER 31,
- ---------------------------------------- -------------- -------------- -------------- --------------
(IN THOUSANDS) 2004 2003 2004 2003
Subscriptions -- Class A 16,980 56,202 396 2,734
Shares issued in reinvestment and capital
gains -- Class A 105 73 13 5
Less shares redeemed -- Class A (10,239) (14,204) (462) (2,590)
-------------- -------------- -------------- --------------
Net Increase (Decrease) -- Class A 6,846 42,071 (53) 149
Subscriptions -- Class B 2,448 20,371 252 653
Shares issued in reinvestment and capital
gains -- Class B 63 48 3 --
Less shares redeemed -- Class B (3,332) (5,154) (164) (343)
-------------- -------------- -------------- --------------
Net Increase (Decrease) -- Class B (821) 15,265 91 310
Subscriptions -- Class C 3,397 20,690 173 911
Shares issued in reinvestment and capital
gains -- Class C 43 32 2 --
Less shares redeemed -- Class C (3,096) (4,207) (166) (833)
-------------- -------------- -------------- --------------
Net Increase (Decrease) -- Class C 344 16,515 9 78
Subscriptions -- Class Z 36,993 89,984 4,001 13,104
Shares issued in reinvestment and capital
gains -- Class Z 327 249 625 313
Less shares redeemed -- Class Z (37,398) (36,502) (7,872) (25,027)
-------------- -------------- -------------- --------------
Net Increase (Decrease) -- Class Z (78) 53,731 (3,246) (11,610)
-------------- -------------- -------------- --------------
Net Increase (Decrease) in Shares of
Beneficial Interest 6,291 127,582 (3,199) (11,073)
-------------- -------------- -------------- --------------
COLUMBIA COLUMBIA ACORN
ACORN USA INTERNATIONAL SELECT
(UNAUDITED) (UNAUDITED)
SIX MONTHS YEAR ENDED SIX MONTHS YEAR ENDED
CHANGES IN SHARES OF BENEFICIAL INTEREST: ENDED JUNE 30, DECEMBER 31, ENDED JUNE 30, DECEMBER 31,
- ---------------------------------------- -------------- -------------- -------------- --------------
(IN THOUSANDS) 2004 2003 2004 2003
Subscriptions -- Class A 795 3,345 54 216
Shares issued in reinvestment and capital
gains -- Class A -- -- -- --
Less shares redeemed -- Class A (579) (1,309) (25) (294)
-------------- -------------- -------------- --------------
Net Increase (Decrease) -- Class A 216 2,036 29 (78)
Subscriptions -- Class B 144 1,087 52 137
Shares issued in reinvestment and capital
gains -- Class B -- -- -- --
Less shares redeemed -- Class B (241) (512) (16) (95)
-------------- -------------- -------------- --------------
Net Increase (Decrease) -- Class B (97) 575 36 42
Subscriptions -- Class C 158 724 30 311
Shares issued in reinvestment and capital
gains -- Class C -- -- -- --
Less shares redeemed -- Class C (157) (279) (153) (339)
-------------- -------------- -------------- --------------
Net Increase (Decrease) -- Class C 1 445 (123) (28)
Subscriptions -- Class Z 5,262 12,184 163 2,239
Shares issued in reinvestment and capital
gains -- Class Z -- -- 10 2
Less shares redeemed -- Class Z (5,074) (4,772) (233) (2,435)
-------------- -------------- -------------- --------------
Net Increase (Decrease) -- Class Z 188 7,412 (60) (194)
-------------- -------------- -------------- --------------
Net Increase (Decrease) in Shares of
Beneficial Interest 308 10,468 (118) (258)
-------------- -------------- -------------- --------------
COLUMBIA
ACORN SELECT
(UNAUDITED)
SIX MONTHS YEAR ENDED
CHANGES IN SHARES OF BENEFICIAL INTEREST: ENDED JUNE 30, DECEMBER 31,
- ---------------------------------------- -------------- --------------
(IN THOUSANDS) 2004 2003
Subscriptions -- Class A 7,899 14,227
Shares issued in reinvestment and capital
gains -- Class A -- 63
Less shares redeemed -- Class A (2,702) (1,869)
-------------- --------------
Net Increase (Decrease) -- Class A 5,197 12,421
Subscriptions -- Class B 2,138 4,854
Shares issued in reinvestment and capital
gains -- Class B -- 30
Less shares redeemed -- Class B (512) (601)
-------------- --------------
Net Increase (Decrease) -- Class B 1,626 4,283
Subscriptions -- Class C 1,549 3,102
Shares issued in reinvestment and capital
gains -- Class C -- 15
Less shares redeemed -- Class C (428) (271)
-------------- --------------
Net Increase (Decrease) -- Class C 1,121 2,846
Subscriptions -- Class Z 5,839 18,117
Shares issued in reinvestment and capital
gains -- Class Z -- 108
Less shares redeemed -- Class Z (3,641) (8,676)
-------------- --------------
Net Increase (Decrease) -- Class Z 2,198 9,549
-------------- --------------
Net Increase (Decrease) in Shares of
Beneficial Interest 10,142 29,099
-------------- --------------
See accompanying notes to financial statements.
1-800-922-6769
58-59 Spread
COLUMBIA ACORN FAMILY OF FUNDS
>FINANCIAL HIGHLIGHTS
(UNAUDITED)
SIX MONTHS
COLUMBIA ACORN FUND CLASS Z ENDED JUNE 30,
- ------------------- ----------- -------------- -----------
SELECTED DATA FOR A SHARE OUTSTANDING
THROUGHOUT EACH PERIOD 2004 2003
NET ASSET VALUE, BEGINNING OF PERIOD $ 22.56 $ 15.50
INCOME FROM INVESTMENT OPERATIONS
Net investment income (a) 0.04 0.03
Net realized and unrealized gain (loss) 1.99 7.05
-------------- -----------
Total from Investment Operations 2.03 7.08
-------------- -----------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income -- --
From net realized gains (0.03) (0.02)
-------------- -----------
Total Distributions Declared to Shareholders (0.03) (0.02)
============== ===========
NET ASSET VALUE, END OF PERIOD $ 24.56 $ 22.56
============== ===========
Total Return (b) 8.99%(c)(d) 45.68%
============== ===========
RATIOS TO AVERAGE NET ASSETS
Expenses (e) 0.79%(f) 0.80%
Net investment income (e) 0.35%(f) 0.17%
Reimbursement 0.01%(f) --
Portfolio turnover rate 11%(d) 10%
Net assets at end of period (in millions) $ 7,687 $ 7,065
COLUMBIA ACORN FUND YEARS ENDED DECEMBER 31,
- ------------------- ------------------------------ ----------- -----------
SELECTED DATA FOR A SHARE OUTSTANDING
THROUGHOUT EACH PERIOD 2002 2001 2000 1999
NET ASSET VALUE, BEGINNING OF PERIOD $ 17.88 $ 17.21 $ 18.53 $ 16.85
INCOME FROM INVESTMENT OPERATIONS
Net investment income (a) 0.02 0.05 0.10 0.09
Net realized and unrealized gain (loss) (2.40) 1.01 1.55 5.22
----------- -------------- ----------- -----------
Total from Investment Operations (2.38) 1.06 1.65 5.31
----------- -------------- ----------- -----------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income -- (0.04) (0.11) (0.09)
From net realized gains -- (0.35) (2.86) (3.54)
----------- -------------- ----------- -----------
Total Distributions Declared to Shareholders -- (0.39) (2.97) (3.63)
=========== ============== =========== ===========
NET ASSET VALUE, END OF PERIOD $ 15.50 $ 17.88 $ 17.21 $ 18.53
=========== ============== =========== ===========
Total Return (b) (13.31)% 6.14% 10.06% 33.40%
=========== ============== =========== ===========
RATIOS TO AVERAGE NET ASSETS
Expenses (e) 0.82% 0.82% 0.83% 0.85%
Net investment income (e) 0.15% 0.28% 0.55% 0.49%
Reimbursement -- -- -- --
Portfolio turnover rate 13% 20% 29% 34%
Net assets at end of period (IN MILLIONS) $ 4,022 $ 4,220 $ 3,983 $ 3,921
(a) Per share data was calculated using average shares outstanding during the
period.
(b) Total return at net asset value assuming all distributions reinvested.
(c) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(d) Not annualized.
(e) The benefits derived from custody fees paid indirectly had no impact.
(f) Annualized.
(UNAUDITED)
SIX MONTHS
COLUMBIA ACORN INTERNATIONAL CLASS Z ENDED JUNE 30,
- ---------------------------- ----------- -------------- -----------
SELECTED DATA FOR A SHARE OUTSTANDING
THROUGHOUT EACH PERIOD 2004 2003
NET ASSET VALUE, BEGINNING OF PERIOD $ 22.66 $ 15.40
INCOME FROM INVESTMENT OPERATIONS
Net investment income (a) 0.20 0.21
Net realized and unrealized gain (loss) 1.78 7.13
-------------- -----------
Total from Investment Operations 1.98 7.34
-------------- -----------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income (0.25) (0.08)
From net realized gains -- --
-------------- -----------
Total Distributions Declared to Shareholders (0.25) (0.08)
============== ===========
NET ASSET VALUE, END OF PERIOD $ 24.39 $ 22.66
============== ===========
Total Return (b) 8.78%(c)(d) 47.80%
============== ===========
RATIOS TO AVERAGE NET ASSETS
Expenses (e) 1.03%(f) 1.05%
Net investment income (e) 1.72%(f) 1.19%
Reimbursement 0.01%(f) --
Portfolio turnover rate 25%(d) 40%
Net assets at end of period (IN MILLIONS) $ 1,602 $ 1,563
COLUMBIA ACORN INTERNATIONAL YEARS ENDED DECEMBER 31,
- ---------------------------- ------------------------------ ----------- -----------
SELECTED DATA FOR A SHARE OUTSTANDING
THROUGHOUT EACH PERIOD 2002 2001 2000 1999
NET ASSET VALUE, BEGINNING OF PERIOD $ 18.47 $ 23.85 $ 35.33 $ 20.82
INCOME FROM INVESTMENT OPERATIONS
Net investment income (a) 0.14 0.12 0.01 0.83
Net realized and unrealized gain (loss) (3.10) (5.11) (6.73) 15.45
----------- -------------- ----------- -----------
Total from Investment Operations (2.96) (4.99) (6.72) 16.28
----------- -------------- ----------- -----------
Less Distributions Declared to Shareholders
From net investment income (0.11) -- (0.66) (0.22)
From net realized gains -- (0.39) (4.10) (1.55)
----------- -------------- ----------- -----------
Total Distributions Declared to Shareholders (0.11) (0.39) (4.76) (1.77)
=========== ============== =========== ===========
NET ASSET VALUE, END OF PERIOD $ 15.40 $ 18.47 $ 23.85 $ 35.33
=========== ============== =========== ===========
Total Return (b) (16.10)% (21.11)% (20.02)% 79.20%
=========== ============== =========== ===========
RATIOS TO AVERAGE NET ASSETS
Expenses (e) 1.06% 1.06% 1.05% 1.11%
Net investment income (e) 0.80% 0.62% 0.02% 0.12%
Reimbursement -- -- -- --
Portfolio turnover rate 52% 45% 63% 46%
Net assets at end of period (IN MILLIONS) $ 1,241 $ 1,613 $ 2,459 $ 2,868
(a) Per share data was calculated using average shares outstanding during the
period.
(b) Total return at net asset value assuming all distributions reinvested.
(c) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(d) Not annualized.
(e) The benefits derived from custody fees paid indirectly had no impact.
(f) Annualized.
(UNAUDITED)
SIX MONTHS
COLUMBIA ACORN USA CLASS Z ENDED JUNE 30,
- ------------------ ----------- -------------- -----------
SELECTED DATA FOR A SHARE OUTSTANDING
THROUGHOUT EACH PERIOD 2004 2003
NET ASSET VALUE, BEGINNING OF PERIOD $ 21.01 $ 14.28
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (a) (0.08) (0.13)
Net realized and unrealized gain (loss) 2.15 6.86
-------------- -----------
Total from Investment Operations 2.07 6.73
-------------- -----------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income -- --
From net realized gains -- --
-------------- -----------
Total Distributions Declared to Shareholders -- --
============== ===========
NET ASSET VALUE, END OF PERIOD $ 23.08 $ 21.01
============== ===========
Total Return (c) 9.85%(d)(e) 47.13%
============== ===========
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 1.06%(g) 1.11%
Net investment income (loss) (f) (0.69)%(g) (0.72)%
Reimbursement 0.01%(g) --
Portfolio turnover rate 11%(e) 7%
Net assets at end of period (IN MILLIONS) $ 556 $ 502
COLUMBIA ACORN USA YEARS ENDED DECEMBER 31,
- ------------------ ------------------------------ ----------- -----------
SELECTED DATA FOR A SHARE OUTSTANDING
THROUGHOUT EACH PERIOD 2002 2001 2000 1999
NET ASSET VALUE, BEGINNING OF PERIOD $ 17.52 $ 14.90 $ 16.75 $ 14.80
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (a) (0.10) (0.08) (0.05) 0.00(b)
Net realized and unrealized gain (loss) (3.14) 2.94 (1.48) 3.32
----------- -------------- ----------- -----------
Total from Investment Operations (3.24) 2.86 (1.53) 3.32
----------- -------------- ----------- -----------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income -- -- (0.00)(b) --
From net realized gains -- (0.24) (0.32) (1.37)
----------- -------------- ----------- -----------
Total Distributions Declared to Shareholders -- (0.24) (0.32) (1.37)
=========== ============== =========== ===========
NET ASSET VALUE, END OF PERIOD $ 14.28 $ 17.52 $ 14.90 $ 16.75
=========== ============== =========== ===========
Total Return (c) (18.49)% 19.25% (8.99)% 23.00%
=========== ============== =========== ===========
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 1.17% 1.17% 1.15% 1.15%
Net investment income (loss) (f) (0.64)% (0.46)% (0.32)% 0.00%(h)
Reimbursement -- -- -- --
Portfolio turnover rate 31% 24% 45% 49%
Net assets at end of period (IN MILLIONS) $ 235 $ 229 $ 222 $ 371
(a) Per share data was calculated using average shares outstanding during the
period.
(b) Rounds to less than $0.01 per share.
(c) Total return at net asset value assuming all distributions reinvested.
(d) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(e) Not annualized.
(f) The benefits derived from custody fees paid indirectly had no impact.
(g) Annualized.
(h) Rounds to less than 0.01%.
See accompanying notes to financial statements.
1-800-922-6769
60-61 Spread
COLUMBIA ACORN FAMILY OF FUNDS
>FINANCIAL HIGHLIGHTS
(UNAUDITED)
SIX MONTHS
COLUMBIA ACORN INTERNATIONAL SELECT CLASS Z ENDED JUNE 30,
- ----------------------------------- ----------- -------------- -----------
SELECTED DATA FOR A SHARE OUTSTANDING
THROUGHOUT EACH PERIOD 2004 2003
NET ASSET VALUE, BEGINNING OF PERIOD $ 14.58 $ 10.29
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (a) 0.03 0.06
Net realized and unrealized gain (loss) 1.09 4.24
-------------- -----------
Total from Investment Operations 1.12 4.30
-------------- -----------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income (0.07) (0.01)
From net realized gains -- --
-------------- -----------
Total Distributions Declared to Shareholders (0.07) (0.01)
============== ===========
NET ASSET VALUE, END OF PERIOD $ 15.63 $ 14.58
============== ===========
Total Return (b) 7.68%(c)(d) 41.79%(c)
============== ===========
RATIOS TO AVERAGE NET ASSETS
Expenses 1.45%(e)(f) 1.45%(e)
Net investment income (loss) 0.42%(e)(f) 0.56%(e)
Reimbursement 0.21%(f) 0.42%
Portfolio turnover rate 46%(d) 69%
Net assets at end of period (IN MILLIONS) $ 35 $ 34
COLUMBIA ACORN INTERNATIONAL SELECT YEARS ENDED DECEMBER 31,
- ----------------------------------- --------------------------------- ----------- -----------
SELECTED DATA FOR A SHARE OUTSTANDING
THROUGHOUT EACH PERIOD 2002 2001 2000 1999
NET ASSET VALUE, BEGINNING OF PERIOD $ 12.09 $ 17.15 $ 19.93 $ 11.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (a) 0.03 (0.05) (0.11) (0.02)
Net realized and unrealized gain (loss) (1.83) (4.92) (2.53) 8.98
----------- -------------- ----------- -----------
Total from Investment Operations (1.80) (4.97) (2.64) 8.96
----------- -------------- ----------- -----------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income -- (0.01) (0.04) --
From net realized gains -- (0.08) (0.10) (0.03)
----------- -------------- ----------- -----------
Total Distributions Declared to Shareholders -- (0.09) (0.14) (0.03)
=========== ============== =========== ===========
NET ASSET VALUE, END OF PERIOD $ 10.29 $ 12.09 $ 17.15 $ 19.93
=========== ============== =========== ===========
Total Return (b) (14.89)%(c) (29.05)%(c) (13.35)% 81.60%(c)
=========== ============== =========== ===========
RATIOS TO AVERAGE NET ASSETS
Expenses 1.45%(e) 1.45%(e) 1.33%(e) 1.48%(g)
Net investment income (loss) 0.26%(e) (0.32)%(e) (0.42)%(e) (0.17)%(g)
Reimbursement 0.33% 0.01% -- 0.09%
Portfolio turnover rate 102% 82% 79% 60%
Net assets at end of period (IN MILLIONS) $ 26 $ 37 $ 130 $ 107
(a) Per share data was calculated using average shares outstanding during the
period.
(b) Total return at net asset value assuming all distributions reinvested.
(c) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(d) Not annualized.
(e) The benefits derived from custody fees paid indirectly had no impact.
(f) Annualized.
(g) In accordance with a requirement of the Securities and Exchange Commission,
the ratios reflect total expenses prior to the reduction of custody fees
for cash balances it maintains with the custodian ("custody fees paid
indirectly"). The ratios of expenses to average daily net assets and net
investment loss to average daily net assets net of custody fees paid
indirectly would have been 1.45% and (0.14)%, respectively for the year
ended December 31, 1999.
(UNAUDITED)
SIX MONTHS
COLUMBIA ACORN SELECT CLASS Z ENDED JUNE 30,
- --------------------- ----------- -------------- -----------
SELECTED DATA FOR A SHARE OUTSTANDING
THROUGHOUT EACH PERIOD 2004 2003
NET ASSET VALUE, BEGINNING OF PERIOD $ 18.20 $ 14.04
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (a) (0.05) (0.10)
Net realized and unrealized gain (loss) 1.40 4.39
-------------- -----------
Total from Investment Operations 1.35 4.29
-------------- -----------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income -- --
From net realized gains -- (0.13)
-------------- -----------
Total Distributions Declared to Shareholders -- (0.13)
============== ===========
NET ASSET VALUE, END OF PERIOD $ 19.55 $ 18.20
============== ===========
Total Return (b) 7.42%(c)(d) 30.61%
============== ===========
RATIOS TO AVERAGE NET ASSETS
Expenses 1.10%(e)(f) 1.12%(e)
Net investment loss (0.50)%(e)(f) (0.63)%(e)
Reimbursement 0.01%(f) --
Portfolio turnover rate 19%(d) 16%
Net assets at end of period (IN MILLIONS) $ 358 $ 294
COLUMBIA ACORN SELECT YEARS ENDED DECEMBER 31,
- --------------------- ------------------------------- ---------- -----------
SELECTED DATA FOR A SHARE OUTSTANDING
THROUGHOUT EACH PERIOD 2002 2001 2000 1999
NET ASSET VALUE, BEGINNING OF PERIOD $ 15.23 $ 14.13 $ 13.70 $ 10.71
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (a) (0.10) (0.05) (0.07) (0.08)
Net realized and unrealized gain (loss) (1.09) 1.18 1.59 3.21
----------- -------------- ----------- -----------
Total from Investment Operations (1.19) 1.13 1.52 3.13
----------- -------------- ----------- -----------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income -- -- (0.01) --
From net realized gains -- (0.03) (1.08) (0.14)
----------- -------------- ----------- -----------
Total Distributions Declared to Shareholders -- (0.03) (1.09) (0.14)
=========== ============== =========== ===========
NET ASSET VALUE, END OF PERIOD $ 14.04 $ 15.23 $ 14.13 $ 13.70
=========== ============== =========== ===========
Total Return (b) (7.81)%(c) 8.00%(c) 11.68% 29.30%(c)
=========== ============== =========== ===========
RATIOS TO AVERAGE NET ASSETS
Expenses 1.26%(e) 1.35% 1.34%(g) 1.37%(g)
Net investment loss (0.67)%(e) (0.44)% (0.52)%(g) (0.62)%(g)
Reimbursement 0.01% 0.03% -- 0.04%
Portfolio turnover rate 40% 82% 116% 101%
Net assets at end of period (IN MILLIONS) $ 93 $ 70 $ 67 $ 68
(a) Per share data was calculated using average shares outstanding during the
period.
(b) Total return at net asset value assuming all distributions reinvested.
(c) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(d) Not annualized.
(e) The benefits derived from custody fees paid indirectly had no impact.
(f) Annualized.
(g) In accordance with a requirement of the Securities and Exchange Commission,
the ratios reflect total expenses prior to the reduction of custody fees
for cash balances it maintains with the custodian ("custody fees paid
indirectly"). The ratios of expenses to average daily net assets and net
investment loss to average daily net assets net of custody fees paid
indirectly would have been 1.32% and (0.50)%, respectively for the year
ended December 31, 2000 and 1.35% and (0.60)%, respectively for the year
ended December 31, 1999.
See accompanying notes to financial statements.
1-800-922-6769
62-63 Spread
COLUMBIA ACORN FAMILY OF FUNDS
>NOTES TO FINANCIAL STATEMENTS, (UNAUDITED)
1. Nature of Operations
Columbia Acorn Fund, Columbia Acorn International, Columbia Acorn USA, Columbia
Acorn International Select and Columbia Acorn Select (the "Funds") are series of
Columbia Acorn Trust (the "Trust"), an open-end management investment company
organized as a Massachusetts business trust. The investment objective of each
Fund is to seek long-term growth of capital. The Funds may issue an unlimited
number of shares. The Funds offer four classes of shares: Class A, Class B,
Class C and Class Z.
Class A shares are sold with a front-end sales charge. A contingent deferred
sales charge ("CDSC") is assessed to Class A shares purchased without an initial
sales charge on redemptions made within eighteen months on an original purchase
of $1 million to $25 million.
Class B shares are subject to a CDSC. Class B shares will convert to Class A
shares in three, four or eight years after purchase, depending on the program
under which shares are purchased.
Class C shares are subject to a CDSC on redemptions made within one year
after purchase.
Class Z shares are offered continuously at net asset value. There are
certain restrictions on the purchase of Class Z shares. Generally, you may
exchange your Class Z or Class A shares of the Fund for shares of another fund
at no additional charge. However, if you exchange Class Z shares of Columbia
Acorn International or Columbia Acorn International Select that you have owned
60 days or less for Class Z shares of a fund distributed by Columbia Funds
Distributor, Inc., that does not have a redemption fee (including Columbia Acorn
Fund, Columbia Acorn USA and Columbia Acorn Select), the Fund will charge you a
redemption fee of 2% of the redemption proceeds. Exchanges between Columbia
Acorn International and Columbia Acorn International Select (or a fund
distributed by Columbia Funds Distributor, Inc. that has a redemption fee) will
not be subject to the 2% redemption fee. In addition, if you redeem shares of
Columbia Acorn International of Columbia Acorn International Select that you
have owned 60 days or less, the Fund will charge you a redemption fee of 2% of
redemption proceeds, with certain exceptions. See "Fund Policy on Trading of
Fund Shares and Redemption Fees" as disclosed within the Funds' prospectus for
more information.
The financial highlights for Class A, Class B and Class C shares are
presented in a separate semi-annual report. The semi-annual financial statements
for the Columbia Thermostat Fund, another Fund of the Trust, begin on page 70 of
this report.
Investment income, realized and unrealized gains and losses, and certain
fund-level expenses are borne pro rata on the basis of the relative net assets
of all classes, except each class bears certain expenses unique to that class
such as distribution services, transfer agent, and certain other class specific
expenses. Differences in class expenses may result in payment of different
dividend distributions for each class. All the share classes of the Trust have
equal rights with respect to voting subject to class specific arrangements.
2. Significant Accounting Policies
>Security valuation
Securities of the Funds are valued at marked value or, if a market quotation for
a security is not readily available or is deemed not to be reliable because of
events or circumstances that have occurred between the market quotation and the
time as of which the security is to be valued, the security is valued at a fair
value determined in accordance with procedures established by the Board of
Trustees. Securities traded on securities exchanges or in over-the-counter
markets in which transaction prices are reported are valued at the last sales
price at the time of valuation. If a security is traded principally on the
Nasdaq Stock Market Inc., the Nasdaq Official Closing Price will be applied.
Securities for which there are no reported sales on the valuation date are
valued at the latest bid quotation. Short-term debt obligations having a
maturity of 60 days or less from the valuation date are valued on an amortized
cost basis, which approximate fair value. Securities for which quotations are
not available are valued at a fair value as determined in good faith by the
Board of Trustees. The Funds may use a systematic fair valuation model provided
by an independent third party to value securities principally traded in foreign
markets in order to adjust for possible stale pricing that may occur between the
close of the foreign exchanges and the time for valuation. If a security is
valued at a "fair value", that value is likely to be different from the last
quoted market price for the security.
>Repurchase agreements
The Funds may engage in repurchase agreement transactions. The Funds, through
their custodians, receive delivery of underlying securities collateralizing
repurchase agreements. The Funds' investment advisor determines that the
1-800-922-6769
64
value of the underlying securities is at all times at least equal to the resale
price. In the event of default or bankruptcy by the other party to the
agreement, realization and/or retention of the collateral may be subject to
legal proceedings.
>Foreign currency translations
Values of investments denominated in foreign currencies are converted into U.S.
dollars using the spot market rate of exchange at the time of valuation.
Purchases and sales of investments and dividend and interest income are
translated into U.S. dollars using the spot market rate of exchange prevailing
on the respective dates of such transactions. The gain or loss resulting from
changes in foreign exchange rates is included with net realized and unrealized
gain or loss from investments, as appropriate.
>Security transactions and investment income
Security transactions are accounted for on the trade date (date the order to buy
or sell is executed) and dividend income is recorded on the ex-dividend date,
except that certain dividends from foreign securities are recorded as soon as
the information is available to the Funds. Interest income is recorded on the
accrual basis and includes amortization of discounts on short-term debt
obligations and long-term debt obligations when required for federal income tax
purposes. Realized gains and losses from security transactions are reported on
an identified cost basis.
Awards from class action litigation may be recorded as a reduction of cost.
If the Funds no longer own the applicable securities, the proceeds are recorded
as realized gains.
The Funds estimate components of distributions from Real Estate Investment
Trusts (REITs). Distributions received in excess of income are recorded as a
reduction of the cost of the related investments. Results of operations for the
year reflect a change in estimate of these components using more current tax
reporting received from REIT investments. The change in estimate had no impact
on each of the Fund's net assets.
>Use of estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and accompanying notes.
Actual results may differ from those estimates.
>Financial instruments
Each Fund may purchase or sell exchange-traded financial futures contracts,
which are contracts that obligate that Fund to make or take delivery of a
financial instrument or the cash value of a securities index at a specified
future date at a specified price. The Funds enter into such contracts to hedge a
portion of their portfolio. Gains and losses are reflected as "Net Realized Gain
(Loss) on Futures" in the Statements of Operations. Additionally, each Fund,
except for Columbia Acorn USA and Columbia Acorn Select, may engage in portfolio
hedging with respect to changes in foreign currency exchange rates by entering
into forward foreign currency contracts to purchase or sell foreign currencies.
The Statements of Operations reflect gains and losses as realized for closed
forward foreign currency contracts and unrealized for open contracts. The Funds
bear the market risk that arises from changes in the value of financial
instruments and securities indices (futures contracts) or from changes in
foreign currency rates (forward foreign currency contracts) and the credit risk
should a counterparty fail to perform under such contracts.
None of the Funds entered into any futures contracts or forward foreign
currency contracts during the six months ended June 30, 2004.
>Fund share valuation
Fund shares are sold and redeemed on a continuing basis at net asset value. Net
asset value per share is determined daily as of the close of trading on the New
York Stock Exchange on each day the Exchange is open for trading. All income,
expenses (other than the Class A, Class B and Class C 12b-1 service and
distribution fees, and Class A, Class B, Class C and Class Z shares Transfer
Agent fees) and realized and unrealized gains (losses) of a fund are allocated
to each class proportionately on a daily basis for purposes of determining the
net asset value of each class. Redemption fees are allocated to paid-in-capital
of each class proportionately for the purposes of determining net asset value of
each class.
>Custody fees
Custody fees are reduced based on each Fund's cash balances maintained with the
custodian. The amount is disclosed as a reduction of total expenses in the
Statement of Operations.
>Federal income taxes
The Funds have complied with the special provisions of the Internal Revenue Code
available to regulated investment companies and, in the manner provided therein,
distribute all their taxable income, as well as any net realized gain on sales
of investments and foreign currency transactions
65
COLUMBIA ACORN FAMILY OF FUNDS
>NOTES TO FINANCIAL STATEMENTS (UNAUDITED), CONTINUED
reportable for federal income tax purposes. Accordingly, the Fund paid no
federal income taxes and no federal income tax provision was required.
>Foreign capital gains taxes
Realized gains in certain countries may be subject to foreign taxes at the fund
level, at rates ranging from approximately 10% to 30%. The Funds accrue for such
foreign taxes on net realized and unrealized gains at the appropriate rate for
each jurisdiction.
>Distributions to Shareholders
Distributions to shareholders are recorded on the ex-date.
3. Federal Tax Information
The tax character of distributions paid during the year ended December 31, 2003
was as follows:
LONG-
TERM
ORDINARY CAPITAL
DECEMBER 31, 2003 INCOME GAINS
- ----------------------------------------------------------------------------
(IN THOUSANDS)
Columbia Acorn Fund $ -- $ 9,917
Columbia Acorn International 5,935 --
Columbia Acorn USA -- --
Columbia Acorn International Select 19 --
Columbia Acorn Select 736 3,445
For the year ended December 31, 2003, the following capital loss carryforwards
are available to reduce taxable income arising from future net realized gains on
investments, if any, to the extent permitted by the Internal Revenue Code:
YEAR OF COLUMBIA ACORN COLUMBIA ACORN
EXPIRATION INTERNATIONAL USA
- ----------------------------------------------------------------------------
(IN THOUSANDS)
2009 $ 111,479 $ 3,035
2010 76,335 10,064
2011 48,476 --
- ----------------------------------------------------------------------------
TOTAL $ 236,290 $ 13,099
COLUMBIA ACORN
YEAR OF INTERNATIONAL
EXPIRATION SELECT
- ----------------------------------------------------------------------------
(IN THOUSANDS)
2009 $ 23,084
2010 12,528
2011 2,488
- ----------------------------------------------------------------------------
TOTAL $ 38,100
Columbia Acorn Fund and Columbia Acorn International have elected to
mark-to-market their investments in Passive Foreign Investment Companies
("PFIC's") for federal income tax purposes. Gains and losses relating to PFIC's
are treated as ordinary income for federal income tax purposes. A summary of
transactions relating to PFIC's is as follows (in thousands):
COLUMBIA ACORN FUND
- ----------------------------------------------------------------------------
Cumulative unrealized appreciation
on PFIC's recognized in prior years
at December 31, 2002 $ 409
Unrealized appreciation (depreciation)
on PFIC's recognized for federal income
tax purposes during 2003 --
Unrealized appreciation recognized in
prior years on PFIC's sold during 2003 (409)
-----------
Cumulative unrealized appreciation on
PFIC's carried forward at December 31, 2003 $ --
-----------
COLUMBIA ACORN INTERNATIONAL
- ----------------------------------------------------------------------------
Cumulative unrealized appreciation
on PFIC's recognized in prior years
at December 31, 2002 $ 7,225
Unrealized appreciation (depreciation)
on PFIC's recognized for federal income
tax purposes during 2003 1,215
Unrealized appreciation recognized in
prior years on PFIC's sold during 2003 (7,225)
-----------
Cumulative unrealized appreciation on
PFIC's carried forward at December 31, 2003 $ 1,215
-----------
4. Transactions with Affiliates
Columbia Wanger Asset Management, L.P. ("Columbia WAM"), an indirect
wholly-owned subsidiary of Columbia Management Group, Inc., which in turn is a
wholly-owned subsidiary of Bank of America Corporation ("BOA"), furnishes
continuing investment supervision to the Funds and is responsible for the
overall management of the Funds' business affairs. Prior to April 1, 2004,
Columbia Management Group, Inc. was a wholly-owned subsidiary of Fleet National
Bank, which in turn was a wholly-owned subsidiary of FleetBoston Financial
Corporation ("Fleet"). On April 1, 2004, Fleet was acquired by BOA.
Under the Funds' investment management agreement, fees are accrued daily
and paid monthly to Columbia WAM at the annual rates shown in the table below
for each fund.
COLUMBIA ACORN FUND
- ----------------------------------------------------------------------------
Net asset value:
On the first $700 million 0.75%
Next $1.3 billion 0.70%
Net assets in excess of $2 billion 0.65%
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66
COLUMBIA ACORN INTERNATIONAL
- ----------------------------------------------------------------------------
Net asset value:
On the first $100 million 1.20%
Next $400 million 0.95%
Net assets in excess of $500 million 0.75%
COLUMBIA ACORN USA
- ----------------------------------------------------------------------------
Net asset value:
On the first $200 million 0.95%
Net assets in excess of $200 million 0.90%
COLUMBIA ACORN INTERNATIONAL SELECT
- ----------------------------------------------------------------------------
On average daily net assets: 0.95%
COLUMBIA ACORN SELECT
- ----------------------------------------------------------------------------
On average daily net assets: 0.90%
Effective August 1, 2004:
Net asset value:
On the first $700 million 0.90%
Net assets in excess of $700 million 0.85%
>Expense Limit
Columbia WAM has voluntarily agreed to reimburse the ordinary operating expenses
(exclusive of interest, taxes and extraordinary expenses, if any) exceeding
1.45% of the average annual net assets for Columbia Acorn International Select
Class Z shares and 1.35% of the average annual net assets for Columbia Acorn
Select Class Z shares.
Columbia WAM also provides administrative services to each Fund at an annual
rate of 0.05% of average daily net assets.
Effective August 1, 2004 Columbia WAM will receive an administration fee
from the Funds, based on the average daily net assets of the Trust, at the
following annual rates:
COLUMBIA ACORN TRUST
- ----------------------------------------------------------------------------
Average daily net asset value:
On the first $8 billion 0.05%
Next $8 billion 0.04%
Average daily net assets in excess of $16 billion 0.03%
Columbia Funds Distributor, Inc. ("CFDI"), an indirect wholly-owned
subsidiary of BOA, is the Fund's principal underwriter and receives no
compensation on the sale of Class Z shares.
Each Fund has adopted a 12b-1 plan which requires it to pay CFDI a service
and distribution fee on the net assets attributable to Class A, Class B and
Class C shares.
Columbia Funds Services, Inc. (the "Transfer Agent"), an indirect,
wholly-owned subsidiary of BOA, provides shareholder services to the Funds and
receives account charges plus reimbursement for out of pocket expenses.
Certain officers and trustees of the Trust are also officers of Columbia
WAM. The Trust makes no direct payments to its officers and trustees who are
affiliated with Columbia WAM. Trustees' fees and expenses paid by the Funds for
the six months ended June 30, 2004 were as follows, including each Fund's
portion of a special payment to the chairman of the board of $25,000 for
extraordinary time and effort spent on board matters during 2003:
- ----------------------------------------------------------------------------
(IN THOUSANDS)
Columbia Acorn Fund $209
Columbia Acorn International 34
Columbia Acorn USA 13
Columbia Acorn International Select 3
Columbia Acorn Select 8
============================================================================
The Trust provides a deferred compensation plan for its trustees. Under that
plan, a trustee may elect to defer all or a portion of his or her compensation.
Amounts deferred are retained by the Trust and represent an unfunded obligation
of the Trust. The value of amounts deferred is determined by reference to the
change in value of Class Z shares of one or more series of the Trust or a money
market fund as specified by the trustee. Benefits under the deferred
compensation plan are payable upon retirement.
An affiliate may include any company in which a fund owns five percent or
more of its outstanding voting securities. On June 30, 2004, Columbia Acorn Fund
and Columbia Acorn USA each held five percent or more of the outstanding voting
securities of one or more companies. Details of investments in those affiliated
companies are presented on pages 31 and 45, respectively.
During the six months ended June 30, 2004, the Funds engaged in purchase and
sale transactions with funds that have a common investment advisor (or
affiliated investment advisors), common Directors/Trustees, and/or common
Officers. Those transactions complied with Rule 17a-7 under the Investment
Company Act of 1940 and were as follows:
FUNDS PURCHASES SALES
- ----------------------------------- ----------- ---------
(IN THOUSANDS)
Columbia Acorn Fund $ 27,980 $ 741
Columbia Acorn International 3,657 13,528
Columbia Acorn USA -- 1,111
Columbia Acorn International Select 608 4,794
Columbia Acorn Select -- --
67
COLUMBIA ACORN FAMILY OF FUNDS
>NOTES TO FINANCIAL STATEMENTS (UNAUDITED), CONTINUED
5. Borrowing Arrangements
The Trust participates in a $150 million credit facility, which was entered into
to facilitate portfolio liquidity. No amounts have been borrowed under this
facility for the six months ended June 30, 2004.
6. Investment Transactions
The aggregate cost of purchases and proceeds from sales other than short-term
obligations for the six months ended June 30, 2004 were:
COLUMBIA ACORN FUND
- ----------------------------------------------------------------------------
(IN THOUSANDS)
Investment securities
Purchases $1,694,313
Proceeds from sales 1,235,992
============================================================================
COLUMBIA ACORN INTERNATIONAL
- ----------------------------------------------------------------------------
(IN THOUSANDS)
Investment securities
Purchases $414,826
Proceeds from sales 486,377
============================================================================
COLUMBIA ACORN USA
- ----------------------------------------------------------------------------
(IN THOUSANDS)
Investment securities
Purchases $74,090
Proceeds from sales 78,807
============================================================================
COLUMBIA ACORN INTERNATIONAL SELECT
- ----------------------------------------------------------------------------
(IN THOUSANDS)
Investment securities
Purchases $19,664
Proceeds from sales 20,833
============================================================================
COLUMBIA ACORN SELECT
- ----------------------------------------------------------------------------
(IN THOUSANDS)
Investment securities
Purchases $296,012
Proceeds from sales 153,883
============================================================================
7. Legal Proceedings
The Securities and Exchange Commission (the "SEC"), the New York Attorney
General (the "NYAG") and various other regulatory authorities are investigating
late trading and market timing in mutual fund shares, and have sent information
requests and subpoenas to certain affiliates of Columbia Management Group, Inc.
("CMG") (collectively, "Columbia"). These affiliates include CFDI, Columbia
Management Advisors, Inc. ("CMA"), and Columbia WAM. CMA is the adviser to the
Columbia Family of Funds, but is not the adviser to the Columbia Acorn Family of
Funds. Columbia has not uncovered any instances where any of its affiliates were
knowingly involved in late trading of mutual fund shares.
On February 24, 2004, the SEC filed a civil complaint in the United States
District Court for the District of Massachusetts against CFDI and CMA, alleging
that they had violated certain provisions of the federal securities laws in
connection with trading activity in mutual fund shares. Also on February 24,
2004, the NYAG filed a civil complaint in New York Supreme Court, County of New
York against CFDI and CMA alleging that CFDI and CMA had violated certain New
York anti-fraud statutes. Both complaints are based on arrangements between 1998
and 2003 with nine investors for the trading of mutual fund shares. Neither
complaint was filed against Columbia WAM nor the Columbia Acorn Family of Funds.
However, the complaints against CFDI and CMA identified Columbia Acorn Fund,
Columbia Acorn International and Columbia Acorn International Select as funds in
which one or more of the nine investors invested. If either CFDI or CMA were
unsuccessful in its defense of those proceedings, it could be barred from
serving as a distributor or investment adviser for any investment company
registered under the Investment Company Act of 1940, as amended (a "registered
investment company"), which could prevent CFDI from serving as the Funds'
distributor and could affect the ability of an affiliated person of CFDI or CMA
to serve as a distributor or investment adviser for any registered investment
company. The Funds have been informed by CFDI that, in such a situation, it will
seek exemptive relief from the SEC to permit it to continue to serve as the
Funds' distributor. There is no assurance that such exemptive relief would be
granted.
On March 15, 2004, CFDI and CMA entered into agreements in principle with
the SEC Division of Enforcement and NYAG in settlement of the charges. Under the
agreements, CFDI and CMA agreed, among other things, to the following
conditions: payment of $70 million in disgorgement; payment of $70 million in
civil penalties; an order requiring CFDI and CMA to cease and desist from
violations of the antifraud provisions and other provisions of the federal
securities laws; governance changes designed to maintain the independence of the
mutual fund boards of trustees and ensure compliance with securities laws and
fiduciary duties; and retention of an independent consultant to review CFDI's
and CMA's compliance policies and procedures. The agreement requires the final
approval of the SEC. In a separate agreement with the NYAG, Columbia has agreed
to reduce mutual fund fees by $80 million over a five-year period.
1-800-922-6769
68
The Trust and Columbia WAM are defendants in several derivative and class
action lawsuits that allege, in summary, defendants permitted investors to
engage in improper trading of shares of various funds in violation of certain
federal and state laws. The Trust and Columbia WAM are also defendants in a
class action lawsuit that alleges, in summary, that the Trust and Columbia WAM
exposed shareholders of Columbia Acorn International Fund to trading by market
timers by allegedly (a) failing to properly evaluate daily whether a significant
event affecting the value of that Fund's securities had occurred after foreign
markets had closed but before the calculation of the Fund's net asset value
("NAV"); (b) failing to implement the Fund's portfolio valuation and share
pricing policies and procedures; and (c) failing to know and implement
applicable rules and regulations concerning the calculation of NAV (the "Fair
Valuation Lawsuit"). All of these lawsuits have been transferred to a federal
court in Maryland, where they will be consolidated with similar suits in a
Multi-District Litigation proceeding.
The Trust and Columbia WAM are defendants in a class action lawsuit in
Illinois state court similar to the Fair Valuation Lawsuit. Lastly, Columbia WAM
is also defendant in a lawsuit alleging that Columbia WAM used Fund assets to
make undisclosed payments to brokers as an incentive for the brokers to market
the Funds over other mutual funds to investors. The complaint alleges Columbia
WAM breached certain common law duties and federal laws.
The Trust and Columbia WAM intend to defend these suits vigorously. The
Trust does not believe that the pending actions will have a material adverse
effect on the financial statements of any Fund, and Columbia WAM does not
believe that the pending actions will have a material adverse effect on its
ability to perform under its contracts with the Funds.
As a result of these matters or any adverse publicity or other developments
resulting from them, there may be increased redemptions or reduced sales of Fund
shares, which could increase transaction costs or operating expenses, or have
other adverse consequences for the Funds.
In connection with the events described in detail above, various parties
have filed suit against certain funds, their Boards and/or Fleet (and affiliated
entities). These suits and certain regulatory investigations are ongoing.
Accordingly, an estimate of the financial impact of this litigation on any fund,
if any, cannot currently be made.
For the six months ended June 30, 2004, CMG has assumed consulting services
and fees incurred by the Funds in connection with these matters as follows:
- ----------------------------------------------------------------------------
(IN THOUSANDS)
Columbia Acorn Fund $ 135
Columbia Acorn International 20
Columbia Acorn USA 8
Columbia Acorn International Select 1
Columbia Acorn Select 10
============================================================================
69
COLUMBIA THERMOSTAT FUND
>STATEMENT OF INVESTMENTS (UNAUDITED), JUNE 30, 2004
NUMBER OF SHARES
OR PRINCIPAL AMOUNT (000) VALUE (000)
- ----------------------------------------------------------------------------
>BOND FUNDS: 49.8%
5,107 Columbia Intermediate Bond Fund,
Class Z $45,657
2,604 Columbia Federal Securities Fund,
Class Z 27,416
2,146 Columbia High Yield Fund, Class Z 18,221
- ----------------------------------------------------------------------------
TOTAL BOND FUNDS (COST: $92,408) 91,294
>STOCK FUNDS: 49.7%
2,519 Columbia Growth Stock Fund,
Class Z (b) 22,745
1,345 Columbia Growth & Income Fund,
Class Z 22,736
746 Columbia Acorn Fund, Class Z 18,320
525 Columbia Mid-Cap Value Fund,
Class Z (b) 13,694
699 Columbia Acorn Select, Class Z (b) 13,670
- ----------------------------------------------------------------------------
TOTAL STOCK FUNDS (COST: $78,577) 91,165
>SHORT-TERM OBLIGATIONS: 0.5%
$ 1,008 Repurchase Agreement with State
Street Bank & Trust, Co. Dated
6/30/04, Due 7/01/04 at 1.30%
Collateralized by Federal Home
Loan Mortgage Corporation,
Notes, Maturing 2/15/05, Market
Value $1,031 (Repurchase
proceeds: $1,008) 1,008
- ----------------------------------------------------------------------------
(Cost: $1,008) 1,008
-----------
TOTAL INVESTMENTS: 100.0% 183,467
(Cost: $171,993) (a)
CASH AND OTHER ASSETS LESS LIABILITIES: (0.0%) (55)
-----------
TOTAL NET ASSETS: 100% $183,412
============================================================================
>Notes to Statement of Investments (in thousands)
(a) At June 30, 2004, for federal income tax purposes cost of investments was
the same and net unrealized appreciation was $11,474 consisting of gross
unrealized appreciation of $12,704 and gross unrealized depreciation of
$1,230.
1-800-922-6769
70
COLUMBIA THERMOSTAT FUND
>STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
JUNE 30, 2004
- ------------------------------------------------------------------------------
(IN THOUSANDS)
ASSETS
Investments, at value (cost: $171,993) $183,467
Receivable for:
Investments sold 463
Fund shares sold 1,023
Dividends and interest 347
Expense reimbursement due from Advisor 30
Other Assets 3
----------------
Total Assets 185,333
LIABILITIES
Payable for:
Investments purchased 789
Fund shares redeemed 991
Transfer agent fees 16
Custody fees 4
Registration & blue sky fees 14
12b-1 Service & Distribution fees 100
Legal & audit fees 7
----------------
Total Liabilities 1,921
----------------
NET ASSETS $183,412
================
COMPOSITION OF NET ASSETS
Paid in capital $170,738
Undistributed net investment income 1,244
Accumulated net realized loss (44)
Net unrealized appreciation on investments 11,474
----------------
NET ASSETS $183,412
================
Net asset value per share -- Class A (a) $12.61
(Net assets/shares) ($67,687/5,370)
Maximum offering price per share -- Class A (b) $13.38
(Net asset value per share/front-end sales charge) ($12.61/0.9425)
Net asset value and offering price per share -- Class B (a) $12.58
(Net assets/shares) ($69,753/5,543)
Net asset value and offering price per share -- Class C (a) $12.58
(Net assets/shares) ($28,944/2,300)
Net asset value, offering and redemption price per share --
Class Z $12.63
(Net assets/shares) ($17,028/1,348)
(a) Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
(b) On sales of $50,000 or more the offering price is reduced.
See accompanying notes to financial statements.
71
COLUMBIA THERMOSTAT FUND
>STATEMENT OF OPERATIONS (UNAUDITED)
FOR THE SIX MONTHS ENDED JUNE 30, 2004
(IN THOUSANDS)
- ------------------------------------------------------------------------------
INVESTMENT INCOME:
Dividends from investment company shares $ 1,947
Interest income 5
-------
Total Investment Income 1,952
EXPENSES:
Management fee 80
Administration fee 40
12b-1 Service and Distribution fees:
Class A 98
Class B 312
Class C 127
Transfer agent fees:
Class A 46
Class B 70
Class C 25
Class Z 15
Trustees fees 1
Custody fees 12
Registration & blue sky fees 59
Legal & audit fees 14
Non-recurring costs (See Note 7) 2
Other expenses 27
-------
Total expenses 928
Less custody fees paid indirectly --*
Less fees waived by Distributor (28)
Less reimbursement of expenses by Advisor (190)
Non-recurring costs reimbursed (See Note 7) (2)
-------
Net Expenses 708
-------
Net Investment Income 1,244
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on:
Investments (28)
Distributions from investment company shares 23
-------
Net realized loss (5)
-------
Net change in net unrealized appreciation on investments 2,195
-------
Net realized and unrealized gain 2,190
-------
Net Increase in Net Assets resulting from Operations $ 3,434
=======
*Rounds to less than $500.
See accompanying notes to financial statements.
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72
COLUMBIA THERMOSTAT FUND
>STATEMENT OF CHANGES IN NET ASSETS
(UNAUDITED)
SIX MONTHS
ENDED YEAR ENDED
INCREASE IN NET ASSETS JUNE 30, DECEMBER 31,
- ---------------------- ----------- ------------
(IN THOUSANDS) 2004 2003 (a)
OPERATIONS:
Net investment income $1,244 $696
Net realized gain (loss) on investments and distributions
from investment company shares (5) 272
Net change in net unrealized appreciation on investments 2,195 9,219
----------- ------------
Net Increase from Operations 3,434 10,187
DISTRIBUTION TO SHAREHOLDERS FROM:
Net investment income -- Class A -- (395)
Net realized gain -- Class A (89) (21)
Net investment income -- Class B -- (108)
Net realized gain -- Class B (94) (30)
Net investment income -- Class C -- (43)
Net realized gain -- Class C (40) (10)
Net investment income -- Class Z -- (160)
Net realized gain -- Class Z (22) (14)
----------- ------------
Total Distributions to Shareholders (245) (781)
SHARE TRANSACTIONS:
Subscriptions -- Class A 27,577 40,815
Distributions reinvested -- Class A 80 373
Redemptions -- Class A (3,455) (1,441)
----------- ------------
Net Increase -- Class A 24,202 39,747
Subscriptions -- Class B 20,217 48,741
Distributions reinvested -- Class B 86 125
Redemptions -- Class B (3,207) (1,176)
----------- ------------
Net Increase -- Class B 17,096 47,690
Subscriptions -- Class C 9,956 19,668
Distributions reinvested -- Class C 34 44
Redemptions -- Class C (1,584) (1,015)
----------- ------------
Net Increase -- Class C 8,406 18,697
Subscriptions -- Class Z 4,377 9,094
Distributions reinvested -- Class Z 22 166
Redemptions -- Class Z (1,809) (1,023)
----------- ------------
Net Increase -- Class Z 2,590 8,237
----------- ------------
Net Increase from Share Transactions 52,294 114,371
----------- ------------
Total Increase in Net Assets 55,483 123,777
----------- ------------
NET ASSETS:
Beginning of period 127,929 4,152
----------- ------------
End of period $183,412 $127,929
=========== ============
UNDISTRIBUTED NET INVESTMENT INCOME $1,244 $--
=========== ============
(a) Class A, Class B and Class D commenced operations March 3, 2003. On October
13, 2003, Class D was redesignated Class C.
See accompanying notes to financial statements
73
COLUMBIA THERMOSTAT FUND
>STATEMENT OF CHANGES IN NET ASSETS, CONTINUED
(UNAUDITED)
SIX MONTHS
ENDED PERIOD ENDED
CHANGES IN SHARES OF BENEFICIAL INTEREST: JUNE 30, DECEMBER 31,
- ----------------------------------------- ----------- ------------
(IN THOUSANDS) 2004 2003 (a)
Subscriptions -- Class A 2,219 3,529
Shares issued in reinvestment and capital gains -- Class A 7 31
Less shares redeemed -- Class A (293) (123)
----------- ------------
Net increase -- Class A 1,933 3,437
Subscriptions -- Class B 1,614 4,268
Shares issued in reinvestment and capital gains -- Class B 7 10
Less shares redeemed -- Class B (257) (99)
----------- ------------
Net increase -- Class B 1,364 4,179
Subscriptions -- Class C 793 1,712
Shares issued in reinvestment and capital gains -- Class C 3 4
Less shares redeemed -- Class C (127) (85)
----------- ------------
Net increase -- Class C 669 1,631
Subscriptions -- Class Z 349 821
Shares issued in reinvestment and capital gains -- Class Z 2 14
Less shares redeemed -- Class Z (146) (91)
----------- ------------
Net increase -- Class Z 205 744
----------- ------------
Net increase in Shares of Beneficial Interest 4,171 9,991
----------- ------------
(a) Class A, Class B and Class D commenced operations March 3, 2003. On October
13, 2003, Class D was redesignated Class C.
See accompanying notes to financial statements
1-800-922-6769
74
COLUMBIA THERMOSTAT FUND
>FINANCIAL HIGHLIGHTS
(UNAUDITED) INCEPTION
SIX MONTHS SEPTEMBER 25,
ENDED YEAR ENDED 2002 THROUGH
CLASS Z JUNE 30, DECEMBER 31, DECEMBER 31,
- ------- ----------- ------------ -------------
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004 2003 2002
NET ASSET VALUE, BEGINNING OF PERIOD $12.31 $10.41 $10.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income (a) 0.14 0.19 0.04
Net realized and unrealized gain 0.20 1.87 0.37
----------- ------------ -------------
Total from Investment Operations 0.34 2.06 0.41
----------- ------------ -------------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS
From net investment income -- (0.16) --
From net realized gains (0.02) 0.00(b) --
----------- ------------ -------------
Total Distributions Declared to Shareholders (0.02) (0.16) --
----------- ------------ -------------
NET ASSET VALUE, END OF PERIOD $12.63 $12.31 $10.41
=========== ============ =============
Total Return (c)(d) 2.74%(e) 19.79% 4.10%(e)
=========== ============ =============
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 0.25%(g)(h) 0.38%(g) 0.62%(h)(i)
Net investment income 2.19%(g)(h) 1.64%(g) 1.41%(h)(i)
Reimbursement 0.22%(h) 0.88% 19.94%(h)
Portfolio turnover rate 32%(e) 61% 11%(e)
Net assets at end of period (IN MILLIONS) $17 $14 $4
(a) Per share data was calculated using average shares outstanding during the
period. Recognition of net investment income by the Fund is affected by the
timing of the declaration of dividends by the underlying investment
companies in which the Fund invests.
(b) Rounds to less than $0.01 per share.
(c) Total return at net asset value assuming all distributions reinvested.
(d) Had the Advisor not reimbursed a portion of expenses, total return would
have been reduced.
(e) Not annualized.
(f) Does not include expenses of the investment companies in which the Fund
invests.
(g) The benefits derived from custody fees paid indirectly had no impact.
(h) Annualized.
(i) In accordance with a requirement of the Securities and Exchange Commission,
the ratios reflect total expenses prior to the reduction of custody fees for
cash balances it maintains with the custodian ("custody fees paid
indirectly"). The ratios of expenses to average daily net assets and net
investment income to average daily net assets net of custody fees paid
indirectly would have been 0.60% and 1.43%, respectively for the period
ended December 31, 2002.
See accompanying notes to financial statements
75
COLUMBIA THERMOSTAT FUND
>NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1. Nature of Operations
Columbia Thermostat Fund (the "Fund"), a series of Columbia Acorn Trust (the
"Trust"), an open-end management investment company organized as a Massachusetts
business trust, commenced operations September 25, 2002. The Fund may issue an
unlimited number of shares. The Fund currently offers four classes of shares:
Class A, Class B, Class C and Class Z. On October 13, 2003, Class D was
redesignated Class C.
Class A shares are sold with a front-end sales charge. A contingent deferred
sales charge ("CDSC") may be assessed to Class A shares purchased without an
initial sales charge on redemptions made within eighteen months on an original
purchase of $1 million to $25 million.
Class B shares are subject to a CDSC. Class B shares will convert to Class A
shares in three, four or eight years after purchase, depending on the program
under which shares are purchased.
Class C shares are subject to a CDSC on redemptions made within one year
after purchase.
Class Z shares are offered continuously at net asset value. There are
certain restrictions on the purchase of Class Z shares.
The financial highlights for Class A, Class B and Class C shares are
presented in a separate semi-annual report. The semi-annual report for the other
series of the Trust is also included in this report.
The investment objective of the Fund is to provide long-term total return.
The Fund pursues its investment objective by investing in shares of other mutual
funds. As a 'fund of funds', under normal circumstances, the Fund allocates at
least 95% of its net assets among a selected group of stock and bond mutual
funds (the "Portfolio Funds") according to the current level of the Standard &
Poor's 500 Stock Index in relation to predetermined ranges set by the Fund's
investment adviser. As of June 30, 2004, the Fund invested in five stock
Portfolio Funds (Columbia Acorn Fund, Columbia Acorn Select Fund, Columbia
Growth & Income Fund, Columbia Mid Cap Value Fund and Columbia Growth Stock
Fund) and three bond Portfolio Funds (Columbia Federal Securities Fund, Columbia
Intermediate Bond Fund and Columbia High Yield Fund). The Fund may also invest
up to 5% of its net assets plus any cash received that day in cash, repurchase
agreements, high quality short-term paper and government securities.
2. Significant Accounting Policies
>Security valuation
Investments in Portfolio Funds are valued at their net asset value as reported
by the underlying funds. High quality short-term paper and government securities
having a maturity of 60 days or less from the valuation date are valued on an
amortized cost basis, which approximates fair value.
>Repurchase agreements
The Fund may engage in repurchase agreement transactions. The Fund, through its
custodian, receives delivery of underlying securities collateralizing each
repurchase agreement. The Fund's investment advisor determines that the value of
the underlying securities is at all times at least equal to the resale price. In
the event of default or bankruptcy by the other party to the agreement,
realization and/or retention of the collateral may be subject to legal
proceedings.
>Security transactions and investment income
Portfolio Fund transactions are accounted for on the trade date (date the order
to buy or sell is executed). Dividend income and realized gain distributions
from other funds are recorded on the ex-dividend date. Interest income is
recorded on the accrual basis and includes amortization of discounts on
short-term debt obligations when required for federal income tax purposes.
Realized gains and losses from security transactions are reported on an
identified cost basis. Awards from class action litigation may be recorded as a
reduction of cost by Portfolio Funds. If the Portfolio Fund no longer owns the
applicable securities, the proceeds are recorded as realized gains.
>Use of estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and accompanying notes.
Actual results may differ from those estimates.
>Fund share valuation
Fund shares are sold and redeemed on a continuing basis at net asset value. Net
asset value per share is determined daily as of the close of trading on the New
York Stock Exchange on each day the Exchange is open for trading. All income,
expenses (other than the Class A, Class B and Class C 12b-1 service and
distribution fees, and Class A, Class B, Class C and Class Z Transfer Agent
fees) and
1-800-922-6769
76
realized and unrealized gains (losses) of the Fund are allocated to each class
proportionately on a daily basis for purposes of determining the net asset value
of each class.
>Custody fees
The custody fees are reduced based on the Fund's cash balance maintained with
the custodian. The amount is disclosed as a reduction of total expenses in the
Statement of Operations.
>Federal income taxes
The Fund has complied with the special provisions of the Internal Revenue Code
available to regulated investment companies and, in the manner provided therein,
distributes all of its taxable income, as well as any net realized gain on sales
of Portfolio Fund shares and any distributions of net realized gains received by
the Fund from its Portfolio Funds, reportable for federal income tax purposes.
Accordingly, the Fund paid no federal income taxes and no federal income tax
provision was required.
>Distributions to Shareholders
Distributions to shareholders are recorded on the ex-date.
3. Federal Tax Information
The tax character of distributions paid during the year ended December 31, 2003
was as follows:
ORDINARY LONG-TERM
INCOME CAPITAL GAINS
- -------------------------------------------------------
(IN THOUSANDS)
$ 771 $ 10
4. Transactions with Affiliates
Columbia Wanger Asset Management, L.P. ("Columbia WAM"), an indirect
wholly-owned subsidiary of Columbia Management Group, Inc., which in turn is a
wholly-owned subsidiary of Bank of America Corporation ("BOA"), furnishes
continuing investment supervision to the Fund and is responsible for the overall
management of the Fund's business affairs. Prior to April 1, 2004, Columbia
Management Group, Inc. was a wholly-owned subsidiary of Fleet National Bank,
which in turn was a wholly-owned subsidiary of FleetBoston Financial Corporation
("Fleet"). On April 1, 2004, Fleet was acquired by BOA.
Under the Fund's investment management agreement, fees are accrued daily and
paid monthly to Columbia WAM at the annual rate of 0.10% of the Fund's average
daily net assets.
>Expense Limit
Columbia WAM has agreed to voluntarily reimburse the direct operating expenses
(exclusive of interest and fees on borrowings and expenses associated with the
Fund's investment in other investment companies) exceeding 0.60% of the average
annual net assets of the Fund's Class Z shares. Effective August 1, 2003,
Columbia WAM agreed to contractually reimburse the direct operating expenses
(exclusive of interest and fees on borrowings and expenses associated with the
Fund's investment in other investment companies) exceeding 0.25% of the average
annual net assets of the Fund's Class Z shares.
Columbia WAM also provides administrative services to the Fund at an annual
rate of 0.05% of average daily net assets.
Effective August 1, 2004 Columbia WAM will receive an administration fee
from the Fund, based on the average daily total net assets of the Trust, at the
following annual rates:
COLUMBIA ACORN TRUST
- -------------------------------------------------------------------
Average daily net asset value:
On the first $8 billion 0.05%
Next $8 billion 0.04%
Average daily net assets in excess of $16 billion 0.03%
Columbia Funds Distributor, Inc. ("CFDI"), an indirect wholly-owned
subsidiary of BOA, is the Fund's principal indirect underwriter and receives no
compensation on the sale of Class Z shares.
The Fund has adopted a 12b-1 plan which requires it to pay CFDI a service
and/or distribution fee on net assets attributable to Class A, Class B and Class
C shares.
Columbia Funds Services, Inc. (the "Transfer Agent"), an indirect,
wholly-owned subsidiary of BOA, provides shareholder services to the Fund and
receives account charges plus reimbursement for out of pocket expenses.
Certain officers and trustees of the Trust are also officers of Columbia
WAM. The Trust makes no direct payments
77
COLUMBIA THERMOSTAT FUND
>NOTES TO FINANCIAL STATEMENTS (UNAUDITED), CONTINUED
to its officers and trustees who are affiliated with Columbia WAM. Trustees'
fees and expenses paid by the Fund for the six months ended June 30, 2004,
including the Fund's portion of a special payment to the chairman of the board
of $25,000 for extraordinary time and effort spent on board matters during 2003,
were $1,240.
5. Borrowing Arrangements
The Trust participates in a $150,000,000 credit facility, which was entered into
to facilitate portfolio liquidity. No amounts have been borrowed under this
facility for the six months ended June 30, 2004.
6. Investment Transactions
The aggregate cost of purchases and proceeds from sales other than short-term
obligations for the six months ended June 30, 2004 were:
- ----------------------------------------------------------------------------
(IN THOUSANDS)
Purchases $103,922
Proceeds from sales $50,510
============================================================================
7. Legal Proceedings
The Securities and Exchange Commission (the "SEC"), the New York Attorney
General (the "NYAG") and various other regulatory authorities are investigating
late trading and market timing in mutual fund shares, and have sent information
requests and subpoenas to certain affiliates of Columbia Management Group, Inc.
("CMG") (collectively, "Columbia"). These affiliates include CFDI, Columbia
Management Advisors, Inc. ("CMA"), and Columbia WAM. CMA is the adviser to the
Columbia Family of Funds, but is not the adviser to the Columbia Acorn Family of
Funds. Columbia has not uncovered any instances where any of its affiliates were
knowingly involved in late trading of mutual fund shares.
On February 24, 2004, the SEC filed a civil complaint in the United States
District Court for the District of Massachusetts against CFDI and CMA, alleging
that they had violated certain provisions of the federal securities laws in
connection with trading activity in mutual fund shares. Also on February 24,
2004, the NYAG filed a civil complaint in New York Supreme Court, County of New
York against CFDI and CMA alleging that CFDI and CMA had violated certain New
York anti-fraud statutes. Both complaints are based on arrangements between 1998
and 2003 with nine investors for the trading of mutual fund shares. Neither
complaint was filed against Columbia WAM nor the Columbia Acorn Family of Funds.
However, the complaints against CFDI and CMA identified Columbia Acorn Fund,
Columbia Acorn International and Columbia Acorn International Select as funds in
which one or more of the nine investors invested. If either CFDI or CMA were
unsuccessful in its defense of those proceedings, it could be barred from
serving as a distributor or investment adviser for any investment company
registered under the Investment Company Act of 1940, as amended (a "registered
investment company"), which could prevent CFDI from serving as the Funds'
distributor and could affect the ability of an affiliated person of CFDI or CMA
to serve as a distributor or investment adviser for any registered investment
company. The Funds have been informed by CFDI that, in such a situation, it will
seek exemptive relief from the SEC to permit it to continue to serve as the
Funds' distributor. There is no assurance that such exemptive relief would be
granted.
On March 15, 2004, CFDI and CMA entered into agreements in principle with
the SEC Division of Enforcement and NYAG in settlement of the charges. Under the
agreements, CFDI and CMA agreed, among other things, to the following
conditions: payment of $70 million in disgorgement; payment of $70 million in
civil penalties; an order requiring CFDI and CMA to cease and desist from
violations of the antifraud provisions and other provisions of the federal
securities laws; governance changes designed to maintain the independence of the
mutual fund boards of trustees and ensure compliance with securities laws and
fiduciary duties; and retention of an independent consultant to review CFDI's
and CMA's compliance policies and procedures. The agreement requires the final
approval of the SEC. In a separate agreement with the NYAG, Columbia has agreed
to reduce mutual fund fees by $80 million over a five-year period.
The Trust and Columbia WAM are defendants in several derivative and class
action lawsuits that allege, in summary, defendants permitted investors to
engage in improper trading of shares of various funds in violation of certain
federal
1-800-922-6769
78
and state laws. The Trust and Columbia WAM are also defendants in a class action
lawsuit that alleges, in summary, that the Trust and Columbia WAM exposed
shareholders of Columbia Acorn International Fund to trading by market timers by
allegedly (a) failing to properly evaluate daily whether a significant event
affecting the value of that Fund's securities had occurred after foreign markets
had closed but before the calculation of the Fund's net asset value ("NAV"); (b)
failing to implement the Fund's portfolio valuation and share pricing policies
and procedures; and (c) failing to know and implement applicable rules and
regulations concerning the calculation of NAV (the "Fair Valuation Lawsuit").
All of these lawsuits have been transferred to a federal court in Maryland,
where they will be consolidated with similar suits in a Multi-District
Litigation proceeding.
The Trust and Columbia WAM are defendants in a class action lawsuit in
Illinois state court similar to the Fair Valuation Lawsuit. Lastly, Columbia WAM
is also defendant in a lawsuit alleging that Columbia WAM used Fund assets to
make undisclosed payments to brokers as an incentive for the brokers to market
the Funds over other mutual funds to investors. The complaint alleges Columbia
WAM breached certain common law duties and federal laws.
The Trust and Columbia WAM intend to defend these suits vigorously. The
Trust does not believe that the pending actions will have a material adverse
effect on the financial statements of any Fund, and Columbia WAM does not
believe that the pending actions will have a material adverse effect on its
ability to perform under its contracts with the Funds.
As a result of these matters or any adverse publicity or other developments
resulting from them, there may be increased redemptions or reduced sales of Fund
shares, which could increase transaction costs or operating expenses, or have
other adverse consequences for the Fund.
In connection with the events described in detail above, various parties
have filed suit against certain funds, their Boards and/or Fleet (and affiliated
entities). These suits and certain regulatory investigations are ongoing.
Accordingly, an estimate of the financial impact of this litigation on any fund,
if any, cannot currently be made.
For the six months ended June 30, 2004, CMG has assumed $1,830 consulting
services and fees incurred by the Fund in connection with these matters.
79
CHANGE IN INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Effective April 13, 2004, the audit committee of the Trust requested that Ernst
& Young LLP ("E&Y") resign as the auditors of the Funds. Also effective July 14,
2004, upon the recommendation of the audit committee, the Trust selected
PricewaterhouseCoopers LLP ("PWC") as independent registered public accounting
firm to audit the books and records of each Fund for its fiscal year ending
December 31, 2004. The cessation of the relationship with E&Y was based on the
impairment of E&Y's independence resulting from the consummation of the merger
of FleetBoston Financial Corporation and Bank of America Corporation and
accordingly, E&Y's ability to provide audit services to the Funds.
E&Y's report on the financial statements of each Fund for the past two
years did not contain an adverse opinion or disclaimer of opinion, and was not
qualified or modified as to uncertainty, audit scope or accounting principles.
During the period E&Y was engaged, there were no disagreements with E&Y on any
matter of accounting principles or practices, financial statement disclosure, or
auditing scope or procedure which, if not resolved to E&Y's satisfaction, would
have caused it to make reference to that matter in connection with its report.
1-800-922-6769
80
COLUMBIA ACORN FAMILY OF FUNDS CLASS Z SHARE INFORMATION
MINIMUM INITIAL INVESTMENT IN
COLUMBIA ACORN INTERNATIONAL,
COLUMBIA ACORN INTERNATIONAL
SELECT, COLUMBIA ACORN SELECT,
COLUMBIA THERMOSTAT FUND $1,000
$1,000 FOR AN IRA
COLUMBIA ACORN FUND ACRNX
Management Fee 0.66%
12b-1 Fee None
Other Expenses 0.13%
-------
Expense Ratio 0.79%
COLUMBIA ACORN INTERNATIONAL ACINX
Management Fee 0.82%
12b-1 Fee None
Other Expenses 0.21%
-------
Expense Ratio 1.03%
COLUMBIA ACORN USA AUSAX
Management Fee 0.91%
12b-1 Fee None
Other Expenses 0.15%
-------
Expense Ratio 1.06%
MINIMUM INITIAL INVESTMENT
IN COLUMBIA ACORN FUND
AND COLUMBIA ACORN USA $50,000
MINIMUM SUBSEQUENT
INVESTMENT $50
EXCHANGE FEE NONE
COLUMBIA ACORN INTERNATIONAL SELECT ACFFX
Management Fee 0.95%
12b-1 Fee None
Other Expenses 0.50%
-------
Net Expense Ratio 1.45%
COLUMBIA ACORN SELECT ACTWX
Management Fee 0.90%
12b-1 Fee None
Other Expenses 0.20%
-------
Expense Ratio 1.10%
COLUMBIA THERMOSTAT FUND COTZX
Management Fee 0.10%
12b-1 Fee None
Other Expenses 0.15%
-------
Net Expense Ratio 0.25%*
Fees and expenses are for the six months ended June 30, 2004 and for Columbia
Acorn International Select and Columbia Thermostat Fund include the effect of
Columbia Wanger Asset Management's undertaking to reimburse those funds for any
ordinary operating expenses, net of custody fees paid indirectly, exceeding
1.45% and 0.25% of their average net assets, respectively. The expense
limitation for Columbia Acorn International Select is voluntary and can be
terminated by either the Fund or Columbia Wanger Asset Management, L.P. on 30
days' notice. Columbia Thermostat Fund's reimbursement arrangement is
contractual through April 30, 2005. The Fund's adviser and/or affiliates have
contractually agreed to waive a portion of "other expenses" through April 30,
2005.
*Does not include estimated fees and expenses of 0.94% incurred by the Fund
from the underlying portfolio funds.
81
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COLUMBIA ACORN
- --------------------------------------------------------------------------------
FAMILY OF FUNDS
TRUSTEES
Robert E. Nason
CHAIRMAN
Margaret Eisen
Leo A. Guthart
Jerome Kahn, Jr.
Steven N. Kaplan
David C. Kleinman
Charles P. McQuaid
Allan B. Muchin
Ralph Wanger
John A. Wing
OFFICERS
Charles P. McQuaid
PRESIDENT
Ben Andrews
VICE PRESIDENT
Michael G. Clarke
ASSISTANT TREASURER
J. Kevin Connaughton
ASSISTANT TREASURER
P. Zachary Egan
VICE PRESIDENT
Kenneth A. Kalina
ASSISTANT TREASURER
Bruce H. Lauer
VICE PRESIDENT, SECRETARY AND TREASURER
Louis J. Mendes
VICE PRESIDENT
Robert A. Mohn
VICE PRESIDENT
Todd M. Narter
VICE PRESIDENT
Christopher J. Olson
VICE PRESIDENT
Vincent P. Pietropaolo
ASSISTANT SECRETARY
Robert P. Scales
CHIEF COMPLIANCE OFFICER, VICE PRESIDENT
GENERAL COUNSEL AND CHIEF LEGAL OFFICER
INVESTMENT ADVISER
Columbia Wanger Asset Management, L.P.
227 West Monroe Street, Suite 3000
Chicago, Illinois 60606
1-800-922-6769
DISTRIBUTOR
Columbia Funds Distributor, Inc.
One Financial Center
Boston, Massachusetts 02111-2621
TRANSFER AGENT, DIVIDEND DISBURSING AGENT
Columbia Funds Services, Inc.
P.O. Box 8081
Boston, Massachusetts 02266-8081
1-800-345-6611
LEGAL COUNSEL
Bell, Boyd & Lloyd LLC
Chicago, Illinois
THIS REPORT, INCLUDING THE SCHEDULES OF INVESTMENTS, IS SUBMITTED FOR THE
GENERAL INFORMATION OF THE SHAREHOLDERS OF COLUMBIA ACORN TRUST. THIS REPORT IS
NOT AUTHORIZED FOR DISTRIBUTION UNLESS PRECEDED OR ACCOMPANIED BY A PROSPECTUS.
AN INVESTOR SHOULD CAREFULLY CONSIDER CHARGES AND EXPENSES BEFORE INVESTING. TO
OBTAIN A PROSPECTUS CONTAINING THIS AND OTHER INFORMATION, PLEASE CALL (800)
922-6769 OR VISIT OUR WEBSITE (SHOWN BELOW). PLEASE READ THE PROSPECTUS
CAREFULLY BEFORE YOU INVEST OR SEND MONEY.
A DESCRIPTION OF THE POLICIES AND PROCEDURES THAT THE FUNDS USE TO DETERMINE HOW
TO VOTE PROXIES RELATING TO THEIR PORTFOLIO SECURITIES IS AVAILABLE (I) WITHOUT
CHARGE, UPON REQUEST, BY CALLING 800-922-6769 AND (II) ON THE SECURITIES AND
EXCHANGE COMMISSION'S WEBSITE AT http://www.sec.gov.
FIND OUT WHAT'S NEW - VISIT OUR WEB SITE AT:
www.columbiafunds.com
OUR E-MAIL ADDRESS IS:
serviceinquiries@columbiamanagement.com
SHAREHOLDERS SHOULD NOT INCLUDE PERSONAL INFORMATION SUCH AS ACCOUNT NUMBERS,
SOCIAL SECURITY NUMBERS OR TAXPAYER IDENTIFICATION NUMBERS IN E-MAIL. WE ARE
UNABLE TO ACCEPT ACCOUNT TRANSACTIONS SENT VIA E-MAIL.
1-800-922-6769
84
DIRECTIONS TO THE 2004 COLUMBIA ACORN FUNDS SHAREHOLDER INFORMATION MEETING
FROM THE SOUTH:
Take 1-57 (which merges with I-94, also known as the Dan Ryan Expressway). Take
the Dan Ryan into Chicago. Follow the signs for the Kennedy (I-90/94) Expressway
West. Travel on the Kennedy and exit using the Monroe Street exit. Turn right
(east) from the exit onto Monroe Street. Proceed east to LaSalle Street and turn
right (south).
FROM THE NORTH:
Take the Kennedy Expressway (I-90/94) south to Chicago. Exit at Jackson
Boulevard. Turn left (east) from the exit onto Jackson Boulevard. Proceed east
on Jackson to LaSalle Street.
FROM THE WEST:
Take the Eisenhower Expressway (I-290) from the west. This becomes Congress
Parkway in the city. Bear right (south) off of Congress onto Franklin Street.
Turn right (east) on Jackson Boulevard. Proceed east on Jackson to LaSalle
Street.
FROM THE SOUTHWEST:
Take the Stevenson Expressway (I-55). Exit to the Kennedy Expressway
(North-Wisconsin). Travel on the Kennedy and exit using the Monroe Street exit.
Turn right (east) from the exit onto Monroe Street. Proceed east to LaSalle
Street and turn right (south).
PARKING INFORMATION
There is no parking in the Bank of America Building but several public parking
lots are located within two blocks of the building. The South Loop Self Park is
located at 318 S. Federal Street. Traders Self Park is located at 326 S. Wells
Street. Both lots are marked on the map on the inside front cover of this
report.
For directions using public transportation, call (312) 836-7000 for CTA travel
information or visit the CTA website at www.transitchicago.com. For Metra
information call (312) 322-6777 during business hours or find information at
www.metrarail.com.
Photo of: berries
--------------------
PRESORTED
FIRST-CLASS MAIL
U.S. POSTAGE PAID
HOLLISTON, MA
PERMIT NO. 20
--------------------
[EAGLE HEAD LOGO] COLUMBIAFUNDS
A MEMBER OF COLUMBIA MANAGEMENT GROUP
(C)2004 COLUMBIA FUNDS DISTRIBUTOR, INC.
ONE FINANCIAL CENTER, BOSTON, MA 02111-2621
ACN-03/221S-0604 (8/04) 04/1812
ITEM 2. CODE OF ETHICS.
Not applicable at this time.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable at this time.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable at this time.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. SCHEDULE OF INVESTMENTS
Not applicable at this time.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
The registrant has not filed Schedule 14A subsequent to the effective date of
that Schedule's Item 7(d)(2)(ii)(G). Although the registrant's investment
adviser, Trustees, or shareholders may submit suggested candidates for
Independent Trustees to the Governance Committee (the "Committee"), neither the
Committee nor the Independent Trustees as a group shall consider those
candidates on a preferential basis as opposed to other possible candidates. Any
shareholders may submit the name of a candidate for consideration by the
Committee by submitting the recommendation to the Trust's Secretary. The
Secretary will forward any such recommendation to the Chairman of the Committee
promptly upon receipt.
ITEM 10. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive officer and principal financial
officer, based on their evaluation of the registrant's disclosure
controls and procedures as of a date within 90 days of the filing of
this report, have concluded that such controls and procedures are
adequately designed to ensure that information required to be
disclosed by the registrant in Form N-CSR is accumulated and
communicated to the registrant's management, including the principal
executive officer and principal financial officer, or persons
performing similar functions, as appropriate to allow timely decisions
regarding required disclosure.
(b) There were no changes in the registrant's internal control over
financial reporting that occurred during the registrant's last fiscal
half-year (the registrant's second fiscal half-year in the case of an
annual report) that has materially affected, or is reasonably likely
to materially affect, the registrant's internal control over financial
reporting.
ITEM 11. EXHIBITS.
(a)(1) Code of ethics required to be disclosed under Item 2 of Form N-CSR: Not
applicable at this time.
(a)(2) Certifications pursuant to Rule 30a-2(a) under the Investment Company Act
of 1940 (17 CFR 270.30a-2(a)) attached hereto as Exhibit 99.CERT.
(a)(3) Not applicable.
(b) Certification pursuant to Rule 30a-2(b) under the Investment Company Act of
1940 (17 CFR 270.30a-2(b)) attached hereto as Exhibit 99.906CERT.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(registrant) Columbia Acorn Trust
-----------------------------------------------------------------
By (Signature and Title) /s/ Charles P. McQuaid
-----------------------------------------------------
Charles P. McQuaid, President
Date September 2, 2004
-------------------------------------------------------------------------
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title) /s/ Charles P. McQuaid
-----------------------------------------------------
Charles P. McQuaid, President
Date September 2, 2004
-------------------------------------------------------------------------
By (Signature and Title) /s/ Bruce H. Lauer
-----------------------------------------------------
Bruce H. Lauer, Treasurer
Date September 2, 2004
-------------------------------------------------------------------------