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 811-06338
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Columbia Balanced Fund, Inc.
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(Exact name of registrant as specified in charter)
One Financial Center, Boston, Massachusetts 02111
- ------------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
Vincent Pietropaolo, Esq.
Columbia Management Group, Inc.
One Financial Center
Boston, MA 02111
- ------------------------------------------------------------------------------
(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: 08/31/2004
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Date of reporting period: 08/31/2004
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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.
COLUMBIA FUNDS
ANNUAL REPORT
AUGUST 31, 2004
[PHOTO OF WOMAN STANDING]
COLUMBIA COMMON STOCK FUND
COLUMBIA GROWTH FUND
COLUMBIA INTERNATIONAL STOCK FUND
COLUMBIA MID CAP GROWTH FUND
COLUMBIA SMALL CAP GROWTH FUND
COLUMBIA REAL ESTATE EQUITY FUND
COLUMBIA TECHNOLOGY FUND
COLUMBIA STRATEGIC INVESTOR FUND
COLUMBIA BALANCED FUND
COLUMBIA SHORT TERM BOND FUND
COLUMBIA FIXED INCOME SECURITIES FUND
COLUMBIA NATIONAL MUNICIPAL BOND FUND
COLUMBIA OREGON MUNICIPAL BOND FUND
COLUMBIA HIGH YIELD FUND
COLUMBIA DAILY INCOME COMPANY
TABLE OF CONTENTS
ECONOMIC UPDATE ......................................... 1
COLUMBIA COMMON STOCK FUND .............................. 2
COLUMBIA GROWTH FUND .................................... 6
COLUMBIA INTERNATIONAL STOCK FUND ....................... 10
COLUMBIA MID CAP GROWTH FUND ............................ 14
COLUMBIA SMALL CAP GROWTH FUND .......................... 18
COLUMBIA REAL ESTATE EQUITY FUND ........................ 22
COLUMBIA TECHNOLOGY FUND ................................ 26
COLUMBIA STRATEGIC INVESTOR FUND ........................ 30
COLUMBIA BALANCED FUND .................................. 34
COLUMBIA SHORT TERM BOND FUND ........................... 38
COLUMBIA FIXED INCOME SECURITIES FUND ................... 42
COLUMBIA NATIONAL MUNICIPAL BOND FUND ................... 46
COLUMBIA OREGON MUNICIPAL BOND FUND ..................... 50
COLUMBIA HIGH YIELD FUND ................................ 54
COLUMBIA DAILY INCOME COMPANY ........................... 58
FINANCIAL STATEMENTS .................................... 62
REPORT OF INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM .................................. 213
UNAUDITED INFORMATION ................................... 214
TRUSTEES ................................................ 216
OFFICERS ................................................ 218
COLUMBIA FUNDS .......................................... 219
IMPORTANT INFORMATION
ABOUT THIS REPORT ....................................... 225
Economic and market conditions change frequently. There is no assurance that the
trends described in this report will continue or commence.
NOT FDIC MAY LOSE VALUE
INSURED NO BANK GUARANTEE
TO OUR FELLOW SHAREHOLDERS _____________________________________________________
COLUMBIA FUNDS
DEAR SHAREHOLDER:
We are pleased to let you know that FleetBoston Financial Corporation and Bank
of America Corporation have merged, effective April 1, 2004. As a result of the
merger, Columbia Management Group became part of the Bank of America family of
companies. Looking ahead, we believe this merger will be a real benefit to our
shareholders. Preserving and leveraging our strengths, the combined organization
intends to deliver additional research and management capabilities, as well as
new products to you. There are no immediate changes planned for fund names or
customer service contacts.
As you might know, on March 15, 2004, FleetBoston Financial announced an
agreement in principle between Columbia Management Advisors, Inc. and Columbia
Funds Distributor, Inc. (collectively "Columbia Management") with the staff of
the Securities and Exchange Commission ("SEC") and the New York Attorney General
("NYAG") to settle charges involving market timing in Columbia Management mutual
funds. (Bank of America came to a similar settlement in principle at the same
time.) Under the agreements Columbia Management agreed, among other things, to
pay $70 million in disgorgement and $70 million in civil penalties. In a
separate agreement with the NYAG, the Columbia Group and its affiliate Bank of
America Capital Management, LLC have agreed to collectively reduce mutual fund
fees by $160 million over a five-year period. Please rest assured that the
settlement and all associated legal fees will be paid by Columbia Management;
not by the affected funds or their shareholders. The agreement requires the
final approval of the SEC and the NYAG.
You should know that your fund's Board of Trustees has taken another important
step to strengthen its capacity to oversee your fund. Recently, the Board of
Trustees appointed Mary Joan Hoene as Chief Compliance Officer of Columbia
funds. In this role, Ms. Hoene will work with the Board of Trustees,
particularly focused on the overall compliance program of the funds and the
responsibility and performance of the funds' service providers. Ms. Hoene will
report directly to the Board of Trustees and will work closely with senior
leadership of Columbia Management, the investment arm of Bank of America, and
with Bank of America's principal compliance executives. Prior to her
appointment, Ms. Hoene was a partner in the law firm of Carter, Ledyard &
Milburn, LLP. Among the firm's clients were investment advisors and independent
directors of mutual funds. Ms. Hoene has also worked for the Securities and
Exchange Commission as associate director and deputy director for the Division
of Investment Management. She has also been an active advisor to several fund
boards in developing independent board practices. The Board is pleased that it
has appointed Ms. Hoene with her broad and extensive experience to this
important new position.
Both your fund's trustees and Columbia Management are committed to serving the
interests of our shareholders, and we will continue to work hard to help you
achieve your financial goals.
In the pages that follow, you'll find valuable information about the economic
environment during the period and the performance of your Columbia fund. These
discussions are followed by financial statements for your fund. We hope that you
will take time to read this report and discuss it with your financial advisor if
you have any questions.
As always, thank you for choosing Columbia funds. It is a privilege to play a
role in your financial future.
Sincerely,
/s/ Thomas C. Theobald /s/ J. Kevin Connaughton
Thomas C. Theobald J. Kevin Connaughton
Chairman, Board of Trustees President, Columbia Funds
J. Kevin Connaughton was named president of Columbia Funds on February 27, 2004.
SUMMARY
FOR THE 12-MONTH PERIOD ENDED AUGUST 31, 2004
o Stock prices rose for all segments of the stock market, as measured by the
S&P 500 Index and the broader Russell 3000 Index. Many sectors retreated as
interest rates moved higher in the spring and a host of uncertainties
unsettled investors. However, performance picked up again slightly just
before the period ended.
[Illustration of two arrows pointing up]
S&P 500 RUSSELL 3000
INDEX INDEX
11.46% 11.31%
o Investment grade bonds chalked up respectable gains despite a period of
extreme interest rate volatility in April and May. The Lehman Brothers
Aggregate Bond Index returned 6.13%. High-yield bonds, which can be less
sensitive to changing interest rates, outperformed the stock market. The
Merrill Lynch US High Yield, Cash Pay Only Index returned 13.64%.
[Illustration of two arrows pointing up]
MERRILL LYNCH LEHMAN
INDEX INDEX
13.64% 6.13%
The S&P 500 Index is an unmanaged index that tracks the performance of 500
widely held, large capitalization US stocks.
The Russell 3000 Index is an unmanaged index that tracks the performance of the
3,000 largest US companies based on total market capitalization.
The Lehman Brothers Aggregate Bond Index is a market value-weighted index that
tracks fixed-rate, publicly placed, dollar-denominated, and non-convertible
investment grade debt issues.
The Merrill Lynch US High Yield, Cash Pay Only Index is an unmanaged index that
tracks the performance of non-investment-grade corporate bonds.
ECONOMIC UPDATE ________________________________________________________________
COLUMBIA FUNDS
Despite occasional uncertainty about jobs and consumer spending, the US economy
grew at a pace of more than 4.5% during the 12-month period that began September
1, 2003 and ended August 31, 2004. Growth slowed in the final months of the
period, and many economists lowered their expectations for the balance of 2004.
Nevertheless, the US economy remained on solid ground.
Consumer confidence seesawed, mostly in reaction to changing job data, which
dominated much of the economic news during the year. The Conference Board
reported that confidence declined on weak job figures early in 2004. Confidence
rose after the US labor markets added more than 1.2 million new jobs between
March and May. However, disappointing job creation in June and July curbed
consumer enthusiasm again in August.
Consumers expressed their confidence in the economy by spending on retail goods,
autos and housing. Low mortgage rates continued to fuel a red-hot housing
market. However, consumer spending declined in two of the last three months of
the period, the first such pullback in a year. Businesses stepped into the gap
and helped fuel the economy during the period. Industrial production rose and
factories utilized more of their capacity. Spending on technology and capital
equipment picked up, and outlays for office and warehouse construction turned
the corner after a three-year downturn.
US STOCKS OUTPERFORMED BONDS
Buoyed by strong gains at the beginning of the period, the S&P 500 Index
returned 11.46% during this 12-month reporting period. However, concerns about
new terror threats and higher interest rates and energy prices sidelined
investors as the period wore on. Late in the period, leadership passed from
small-cap stocks, which were strong performers early in the period, to mid- and
large-cap stocks. Value stocks continued to lead growth stocks. Energy stocks
and real estate investment trusts were the best-performing stocks for the
period.
BONDS REFLECTED THE ECONOMIC NEWS
Despite periods of interest rate volatility, the US bond market delivered
respectable gains. The yield on the 10-year US Treasury bond drifted generally
lower for the first eight months of the period. Then it rose sharply as the
economy strengthened, the employment picture brightened and investors began to
anticipate a shift in the Federal Reserve Board's policy on short-term interest
rates. The Fed delivered on these expectations and raised the federal funds
rate, a key short-term rate, twice during the period--from 1.00% to 1.25% in
June and to 1.50% in August. 1
A shaky stock market, higher energy prices and some weak economic data gave the
bond market a boost in July and August as the 10-year Treasury yield fell to
4.10%, ending the period lower than where it started. As a result, the Lehman
Brothers Aggregate Bond Index, a broad measure of investment grade bond market
performance, returned 6.13%. Municipals were the best performers among
investment-grade bonds, returning 7.11% as measured by the Lehman Brothers
Municipal Bond Index. However, the high-yield sector outdistanced all other
sectors. The Merrill Lynch US High Yield, Cash Pay Only Index returned 13.64%.
1 In September, the federal funds rate was raised to 1.75%.
1
[Sidebar]
PERFORMANCE OF A $ 10,000 INVESTMENT
09/01/94 - 08/31/04 ($)
SALES CHARGE WITHOUT WITH
------------------------------------------
Class A 21,761 20,506
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Class B 21,435 21,435
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Class C 21,435 21,435
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Class D 21,435 21,221
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Class Z 21,890 n/a
Performance data quoted represents past performance and current performance may
be lower or higher. Past performance is no guarantee of future results. The
investment return and principal value will fluctuate so that shares, when
redeemed, may be worth more or less than the original cost. Please visit
www.columbiafunds.com for daily and most recent month-end performance updates.
PERFORMANCE INFORMATION ________________________________________________________
COLUMBIA COMMON STOCK FUND
VALUE OF A $10,000 INVESTMENT 09/01/94 - 08/31/04
[MOUNTAIN CHART]
CLASS A CLASS A
SHARES WITHOUT SHARES WITH
SALES CHARGE SALES CHARGE S&P 500 INDEX
------------ ------------ -------------
09/1994 10000.00 9425.00 10000.00
9754.00 9193.00 9755.00
9805.00 9241.00 9974.00
9564.00 9014.00 9611.00
9766.00 9205.00 9754.00
9850.00 9284.00 10006.00
10256.00 9666.00 10397.00
10468.00 9866.00 10703.00
10585.00 9976.00 11018.00
10928.00 10299.00 11459.00
11089.00 10452.00 11724.00
11512.00 10850.00 12114.00
11615.00 10947.00 12144.00
12017.00 11326.00 12656.00
11848.00 11167.00 12611.00
12382.00 11670.00 13165.00
12777.00 12042.00 13419.00
13017.00 12269.00 13875.00
13217.00 12457.00 14004.00
13491.00 12716.00 14138.00
13678.00 12891.00 14346.00
13959.00 13157.00 14716.00
14049.00 13241.00 14772.00
13393.00 12623.00 14119.00
13938.00 13136.00 14417.00
14484.00 13651.00 15229.00
14532.00 13696.00 15649.00
15516.00 14624.00 16832.00
15421.00 14534.00 16499.00
15933.00 15017.00 17530.00
16084.00 15160.00 17667.00
15850.00 14938.00 16941.00
16292.00 15355.00 17952.00
17240.00 16249.00 19045.00
17947.00 16915.00 19899.00
19228.00 18123.00 21483.00
18665.00 17592.00 20280.00
19462.00 18343.00 21391.00
18726.00 17649.00 20676.00
19016.00 17923.00 21634.00
19332.00 18220.00 22006.00
19446.00 18328.00 22250.00
20543.00 19362.00 23854.00
21517.00 20279.00 25076.00
21534.00 20296.00 25329.00
21112.00 19898.00 24893.00
22362.00 21076.00 25904.00
22107.00 20835.00 25629.00
18822.00 17739.00 21923.00
19798.00 18660.00 23329.00
20998.00 19791.00 25225.00
22313.00 21030.00 26754.00
24412.00 23009.00 28295.00
25533.00 24065.00 29478.00
24892.00 23461.00 28561.00
26204.00 24697.00 29703.00
26615.00 25085.00 30853.00
25905.00 24415.00 30125.00
27767.00 26170.00 31797.00
26915.00 25367.00 30805.00
26425.00 24905.00 30654.00
25933.00 24442.00 29814.00
27476.00 25896.00 31701.00
28457.00 26821.00 32345.00
30702.00 28937.00 34250.00
29533.00 27835.00 32530.00
30723.00 28956.00 31915.00
33887.00 31939.00 35037.00
32827.00 30939.00 33982.00
31425.00 29618.00 33286.00
32839.00 30951.00 34108.00
32445.00 30579.00 33576.00
34453.00 32472.00 35661.00
31873.00 30040.00 33778.00
30862.00 29088.00 33636.00
28397.00 26764.00 30985.00
28945.00 27280.00 31137.00
29492.00 27796.00 32243.00
26292.00 24780.00 29302.00
24614.00 23199.00 27444.00
26529.00 25004.00 29577.00
26649.00 25116.00 29775.00
25924.00 24433.00 29051.00
25413.00 23952.00 28767.00
23677.00 22316.00 26966.00
21407.00 20176.00 24787.00
21811.00 20557.00 25261.00
23524.00 22171.00 27198.00
23853.00 22481.00 27437.00
23209.00 21874.00 27037.00
22731.00 21424.00 26515.00
23495.00 22144.00 27512.00
21918.00 20658.00 25845.00
21942.00 20681.00 25653.00
20294.00 19127.00 23827.00
18419.00 17360.00 21971.00
18611.00 17541.00 22114.00
16651.00 15694.00 19710.00
18025.00 16988.00 21444.00
19220.00 18115.00 22707.00
17897.00 16868.00 21374.00
17489.00 16484.00 20814.00
17141.00 16156.00 20502.00
17237.00 16246.00 20701.00
18606.00 17536.00 22407.00
19458.00 18339.00 23588.00
19662.00 18532.00 23890.00
20034.00 18882.00 24310.00
20671.00 19483.00 24784.00
20299.00 19132.00 24521.00
21452.00 20219.00 25909.00
21739.00 20489.00 26137.00
22616.00 21315.00 27507.00
22869.00 21554.00 28013.00
23338.00 21996.00 28402.00
23002.00 21679.00 27974.00
22353.00 21068.00 27534.00
22713.00 21407.00 27912.00
23085.00 21758.00 28453.00
21908.00 20648.00 27511.00
08/2004 21761.00 20506.00 27614.00
The graph and table do not reflect the deduction of taxes that a shareholder
would pay on fund distributions or the redemption of fund shares. The Standard &
Poor's (S&P) 500 Index is an unmanaged index that tracks the performance of 500
widely held, large-capitalization U.S. stocks. Unlike mutual funds, indices are
not investments, do not incur fees or expenses and are not professionally
managed. It is not possible to invest directly in an index. Securities in the
fund may not match those in an index.
AVERAGE ANNUAL TOTAL RETURN AS OF 08/31/04 (%)
SHARE CLASS A B C D Z
- ----------------------------------------------------------------------------------------------------------------------------
INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 10/01/91
- ----------------------------------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- ----------------------------------------------------------------------------------------------------------------------------
1-year 5.28 -0.78 4.44 -0.56 4.44 3.44 4.50 2.47 5.58
- ----------------------------------------------------------------------------------------------------------------------------
5-year -3.81 -4.95 -4.10 -4.43 -4.10 -4.10 -4.10 -4.30 -3.70
- ----------------------------------------------------------------------------------------------------------------------------
10-year 8.09 7.45 7.92 7.92 7.92 7.92 7.92 7.81 8.15
AVERAGE ANNUAL TOTAL RETURN AS OF 06/30/04 (%)
SHARE CLASS A B C D Z
- ----------------------------------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- ----------------------------------------------------------------------------------------------------------------------------
1-year 17.40 10.65 16.49 11.49 16.49 15.49 16.43 14.28 17.79
- ----------------------------------------------------------------------------------------------------------------------------
5-year -3.63 -4.76 -3.89 -4.21 -3.89 -3.89 -3.90 -4.09 -3.52
- ----------------------------------------------------------------------------------------------------------------------------
10-year 9.49 8.84 9.34 9.34 9.34 9.34 9.34 9.23 9.55
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF
5.75% FOR CLASS A SHARES AND 1% FOR CLASS D SHARES, MAXIMUM CONTINGENT DEFERRED
SALES CHARGE OF 5.00% FOR CLASS B SHARES AND 1.00% FOR CLASS C AND D SHARES FOR
THE FIRST YEAR ONLY.
ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS, IF ANY. CLASS Z SHARES
ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT
SHARE CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES
ASSOCIATED WITH EACH CLASS.
Effective October 13, 2003, class D shares were closed to all new investors and
new accounts. Existing class D shareholders will be able to make additional
purchases at any time. In addition, the class D initial sales charge of 1.00% is
waived after October 13, 2003.
Performance results reflect any voluntary waivers or reimbursement of fund
expenses by the advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
Classes A, B, and D (newer class shares) share performance information includes
returns of the fund's class Z shares (the oldest existing fund class) for
periods prior to the inception of the newer class shares. The returns for class
C include the returns of class B prior to 10/13/03, the date on which class C
was initially offered by the fund. The returns shown for class C also include
the performance of class Z prior to the inception of class B (11/01/02). Class Z
share returns are not restated to reflect any expense differential (e.g., Rule
12b-1 fees) between class Z shares and the newer class shares. Had the expense
differential been reflected, the returns for the periods prior to the inception
of classes A, B, C, and D would have been lower.
2
[Sidebar]
ESTIMATING YOUR ACTUAL EXPENSES
To estimate the expenses that you paid over the period, first you will need your
account balance at the end of the period:
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS
SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT
WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE
FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE
1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT
BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6
2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD,"
LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE
COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1.
YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING
THE PERIOD
UNDERSTANDING YOUR EXPENSES ____________________________________________________
COLUMBIA COMMON STOCK FUND
As a fund shareholder, you incur two types of costs. There are transaction
costs, which generally include sales charges on purchases and may include
redemption or exchange fees. There are also ongoing costs, which generally
include investment advisory fees, and/or Rule 12b-1 fees, and other fund
expenses. The information on this page is intended to help you understand your
ongoing costs of investing in the fund and to compare these costs with the
ongoing costs of investing in other mutual funds.
ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS
To illustrate these ongoing costs, we have provided an example and calculated
the expenses paid by investors in each share class during the reporting period.
The information in the following table is based on an initial investment of
$1,000, which is invested at the beginning of the reporting period and held for
the entire period. Expense information is calculated two ways and each method
provides you with different information. The amount listed in the "actual"
column is calculated using the fund's actual operating expenses and total return
for the period. The amount listed in the "hypothetical" column for each share
class assumes that the return each year is 5% before expenses and includes the
fund's actual expense ratio. You should not use the hypothetical account values
and expenses to estimate either your actual account balance at the end of the
period or the expenses you paid during this reporting period.
MARCH 1, 2004 - AUGUST 31, 2004
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED
BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%)
- --------------------------------------------------------------------------------------------------------------------
ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL
- --------------------------------------------------------------------------------------------------------------------
Class A 1,000.00 1,000.00 935.20 1,019.25 5.69 5.94 1.17
- --------------------------------------------------------------------------------------------------------------------
Class B 1,000.00 1,000.00 932.18 1,015.48 9.33 9.73 1.92
- --------------------------------------------------------------------------------------------------------------------
Class C 1,000.00 1,000.00 933.29 1,015.48 9.33 9.73 1.92
- --------------------------------------------------------------------------------------------------------------------
Class D 1,000.00 1,000.00 933.74 1,015.48 9.33 9.73 1.92
- --------------------------------------------------------------------------------------------------------------------
Class Z 1,000.00 1,000.00 935.40 1,020.51 4.48 4.67 0.92
Expenses paid during the period are equal to the fund's annualized expense
ratio, multiplied by the average account value over the period, then multiplied
by the number of days in the fund's most recent fiscal half-year and divided by
366.
It is important to note that the expense amounts shown in the table are meant to
highlight only ongoing costs of investing in the fund and do not reflect any
transactional costs, such as sales charges, redemption or exchange fees.
Therefore, the hypothetical examples provided may not help you determine the
relative total costs of owning different funds. If these transactional costs
were included, your costs would have been higher.
COMPARE WITH OTHER FUNDS
Since all mutual fund companies are required to include the same hypothetical
calculations about expenses in shareholder reports, you can use this information
to compare the ongoing cost of investing in the fund with other funds. To do so,
compare the 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of other funds. As you compare hypothetical
examples of other funds, it is important to note that hypothetical examples are
meant to highlight the continuing cost of investing in a fund and do not reflect
any transactional costs, such as sales charges or redemption or exchange fees.
3
[Sidebar]
SUMMARY
o FOR THE 12-MONTH PERIOD THAT ENDED AUGUST 31, 2004, THE FUND'S CLASS A
SHARES RETURNED 5.28% WITHOUT SALES CHARGE.
o THE FUND'S RETURN WAS LOWER THAN BOTH THE S&P 500 INDEX AND THE AVERAGE OF
THE LIPPER LARGE CAP CORE FUNDS CATEGORY.
o A COMBINATION OF ABOVE-AVERAGE EXPOSURE TO THE TROUBLED INFORMATION
TECHNOLOGY AND CONSUMER DISCRETIONARY SECTORS AND STOCK SELECTION RESTRAINED
THE FUND'S PERFORMANCE.
[Illustration of two arrows pointing up]
CLASS A SHARES S&P 500 Index
5.28% 11.46%
OBJECTIVE
Seeks capital appreciation by
investing primarily in common
stocks of large capitalization,
well-established companies.
TOTAL NET ASSETS
$306.7 million
NET ASSET VALUE PER SHARE
AS OF 08/31/04 ($)
Class A 18.10
------------------------------------------
Class B 17.88
------------------------------------------
Class C 17.88
------------------------------------------
Class D 17.88
------------------------------------------
Class Z 18.12
DISTRIBUTIONS DECLARED PER SHARE
09/01/03 - 08/31/04 ($)
Class A 0.03
------------------------------------------
Class B 0.00
------------------------------------------
Class C 0.00
------------------------------------------
Class D 0.00
------------------------------------------
Class Z 0.10
PORTFOLIO MANAGERS' REPORT _____________________________________________________
COLUMBIA COMMON STOCK FUND
For the 12-month period ended August 31, 2004, Columbia Common Stock Fund class
A shares returned 5.28% without sales charge. This was less than the S&P 500
Index, which returned 11.46% over the same period. The fund's performance was
also lower than the average return of its peer group, the Lipper Large Cap Core
Funds Category, 7.46%. 1
The fund's underperformance was due to a combination of poor sector and stock
selection. The fund's relatively low exposure to the strong energy and utilities
sectors and an above-index weight in consumer and information technology stocks
detracted from the fund's return. Although tech stocks QUALCOMM and Yahoo! both
rose more than 70% during the period, most tech stocks fared poorly, and losses
from holdings such as Veritas Software and Seagate Technology outweighed those
gains. We eliminated all four positions. Financial and materials stocks helped
performance. In financials, Bank One, which was acquired by JPMorgan Chase &
Co., was a top performer.
CONTINUED FOCUS ON CONSUMER DISCRETIONARY SECTOR
While our above-index exposure to consumer discretionary stocks did not help
returns during this reporting period, we continue to believe that the modest
economic growth we expect in the coming year could favor this sector. We have
recently purchased DirecTV Group and increased positions on Comcast. In many
parts of the country, telephone and Internet service are now available through a
cable connection, and we believe this trend has the potential to continue.
CAUTIOUS ON CONSUMER STAPLES
We are less confident about the prospects for consumer staples stocks and
currently have a low investment weight in that sector. Higher commodity prices
have driven up the price of basic materials, such as cardboard for boxes and the
aluminum for cans. In today's competitive markets, it is more difficult for
companies to pass those costs on to the consumer in the form of higher prices.
We believe it is just a matter of time before these cost increases affect the
profitability of consumer staples companies. At the end of the period, we
eliminated our positions in companies we believe might be affected by this
trend, including Kellogg, Hershey and Avon Products.
NEW HOLDING IN INDUSTRIALS
In a variation on that theme, we added Southwest Airlines to the portfolio at
the end of the period because we were impressed that the company anticipated
rising fuel costs and took action to control them. Southwest Airlines has locked
in its fuel costs for 2004 at $24 a barrel,
1 Lipper Inc., a widely respected data provider in the industry, calculates an
average total return for mutual funds with similar investment objectives as
those of the fund.
4
[Sidebar]
TOP 5 SECTORS AS OF 08/31/04 (%)
Financials 20.0
------------------------------------------
Information technology 17.2
------------------------------------------
Consumer discretionary 17.2
------------------------------------------
Health care 14.6
------------------------------------------
Energy 7.4
TOP 10 HOLDINGS AS OF 08/31/04 (%)
Microsoft 3.8
------------------------------------------
MGIC Investment 2.7
------------------------------------------
JPMorgan Chase & Co. 2.5
------------------------------------------
Citigroup 2.4
------------------------------------------
Fannie Mae 2.1
------------------------------------------
Pfizer 2.0
------------------------------------------
DirecTV Group 2.0
------------------------------------------
Time Warner 2.0
------------------------------------------
Telefonos De Mexico SA 2.0
------------------------------------------
Kohl's 1.9
HOLDINGS DISCUSSED IN THIS REPORT
AS OF 08/31/04 (%)
JPMorgan Chase & Co. 2.5
------------------------------------------
Comcast 1.8
------------------------------------------
DirecTV Group 2.0
------------------------------------------
Southwest Airlines 1.5
Your fund is actively managed and the composition of its portfolio will change
over time. Information provided is calculated as a percentage of net assets.
________________________________________________________________________________
COLUMBIA COMMON STOCK FUND
and 50% of its supply for 2005 at $25 a barrel. With oil prices in the $40 range
throughout much of this year, and many airlines struggling financially, we
believe this enhances Southwest Airline's competitive position.
CAUTIOUS OPTIMISM GOING FORWARD
Although we are generally confident about US economic growth, we believe the
past year has been a turning point for consumers. While inflation as measured by
the Consumer Price Index has been negligible, we believe actual living costs
have risen significantly for most Americans. Mortgage and interest rates have
been low, but the cost of health coverage, car insurance and gasoline have all
risen steadily. We believe this "stealth inflation" may be poised to catch up
with the US economy, and could have an unexpected impact. As a result, we
believe we have positioned the fund to take advantage of--and avoid the pitfalls
of--some of these trends.
Columbia Common Stock Fund is managed by a group of managers from Columbia's
large cap core team:
/s/ John Maack /s/ Guy W. Pope, CFA
John Maack Guy W. Pope, CFA
An investment in the fund may present certain risks, including stock market
fluctuations that occur in response to economic and business developments.
On October 13, 2004, the Board of Trustees approved a proposal to reorganize the
Columbia Common Stock Fund, subject to shareholder approval and the satisfaction
of certain other conditions.
5
[Sidebar]
PERFORMANCE OF A $10,000 INVESTMENT
09/01/94 - 08/31/04 ($)
SALES CHARGE WITHOUT WITH
------------------------------------------
Class A 18,697 17,622
------------------------------------------
Class B 18,449 18,449
------------------------------------------
Class C 18,404 18,404
------------------------------------------
Class D 18,464 18,281
------------------------------------------
Class G 18,479 18,479
------------------------------------------
Class Z 18,817 n/a
Performance data quoted represents past performance and current performance may
be lower or higher. Past performance is no guarantee of future results. The
investment return and principal value will fluctuate so that shares, when
redeemed, may be worth more or less than the original cost. Please visit
www.columbiafunds.com for daily and most recent month-end performance updates.
PERFORMANCE INFORMATION ________________________________________________________
COLUMBIA GROWTH FUND
VALUE OF A $10,000 INVESTMENT 09/01/94 - 08/31/04
[MOUNTAIN CHART]
CLASS A CLASS A
SHARES WITHOUT SHARES WITH RUSSELL 1000
SALES CHARGE SALES CHARGE S&P 500 INDEX GROWTH INDEX
------------ ------------ ------------- ------------
09/1994 10000.00 9425.00 10000.00 10000.00
9758.00 9197.00 9755.00 9865.00
9940.00 9369.00 9974.00 10097.00
9613.00 9061.00 9611.00 9773.00
9749.00 9188.00 9754.00 9937.00
9772.00 9210.00 10006.00 10150.00
10247.00 9658.00 10397.00 10575.00
10616.00 10006.00 10703.00 10884.00
10765.00 10146.00 11018.00 11122.00
11008.00 10375.00 11459.00 11509.00
11424.00 10767.00 11724.00 11953.00
11875.00 11193.00 12114.00 12450.00
12083.00 11389.00 12144.00 12464.00
12401.00 11688.00 12656.00 13039.00
12084.00 11389.00 12611.00 13048.00
12838.00 12099.00 13165.00 13555.00
12965.00 12219.00 13419.00 13633.00
13100.00 12346.00 13875.00 14088.00
13700.00 12912.00 14004.00 14346.00
13652.00 12867.00 14138.00 14365.00
14103.00 13293.00 14346.00 14742.00
14512.00 13678.00 14716.00 15257.00
14508.00 13674.00 14772.00 15278.00
13421.00 12650.00 14119.00 14383.00
13878.00 13080.00 14417.00 14754.00
14690.00 13845.00 15229.00 15828.00
14950.00 14090.00 15649.00 15923.00
15862.00 14950.00 16832.00 17119.00
15660.00 14760.00 16499.00 16783.00
16210.00 15278.00 17530.00 17960.00
16224.00 15291.00 17667.00 17838.00
15399.00 14513.00 16941.00 16873.00
16162.00 15233.00 17952.00 17993.00
17263.00 16270.00 19045.00 19292.00
17981.00 16947.00 19899.00 20064.00
19576.00 18450.00 21483.00 21837.00
18858.00 17773.00 20280.00 20560.00
19606.00 18479.00 21391.00 21572.00
19112.00 18013.00 20676.00 20773.00
19642.00 18512.00 21634.00 21656.00
19779.00 18642.00 22006.00 21899.00
20309.00 19141.00 22250.00 22554.00
21802.00 20548.00 23854.00 24250.00
22833.00 21520.00 25076.00 25217.00
22902.00 21585.00 25329.00 25565.00
22350.00 21065.00 24893.00 24839.00
24044.00 22661.00 25904.00 26359.00
23693.00 22330.00 25629.00 26185.00
19793.00 18655.00 21923.00 22255.00
20531.00 19351.00 23329.00 23964.00
21683.00 20436.00 25225.00 25891.00
23112.00 21783.00 26754.00 27861.00
25786.00 24303.00 28295.00 30374.00
27410.00 25834.00 29478.00 32157.00
26500.00 24977.00 28561.00 30687.00
28109.00 26493.00 29703.00 32305.00
28162.00 26543.00 30853.00 32347.00
27458.00 25880.00 30125.00 31354.00
29540.00 27841.00 31797.00 33548.00
28509.00 26870.00 30805.00 32482.00
27728.00 26133.00 30654.00 33011.00
27212.00 25647.00 29814.00 32318.00
28736.00 27083.00 31701.00 34758.00
30118.00 28386.00 32345.00 36635.00
32497.00 30629.00 34250.00 40445.00
31389.00 29584.00 32530.00 38548.00
33169.00 31262.00 31915.00 40433.00
36685.00 34575.00 35037.00 43328.00
35188.00 33165.00 33982.00 41265.00
32968.00 31072.00 33286.00 39186.00
35892.00 33828.00 34108.00 42156.00
35698.00 33645.00 33576.00 40398.00
38575.00 36357.00 35661.00 44054.00
35200.00 33176.00 33778.00 39887.00
33113.00 31209.00 33636.00 38000.00
29186.00 27507.00 30985.00 32399.00
29915.00 28195.00 31137.00 31375.00
31611.00 29794.00 32243.00 33543.00
26572.00 25045.00 29302.00 27847.00
23676.00 22315.00 27444.00 24818.00
26640.00 25109.00 29577.00 27957.00
26355.00 24840.00 29775.00 27546.00
25781.00 24298.00 29051.00 26907.00
24675.00 23256.00 28767.00 26234.00
22548.00 21251.00 26966.00 24088.00
20106.00 18950.00 24787.00 21684.00
21240.00 20019.00 25261.00 22823.00
23464.00 22114.00 27198.00 25016.00
23513.00 22161.00 27437.00 24968.00
22547.00 21250.00 27037.00 24527.00
21354.00 20126.00 26515.00 23509.00
22172.00 20897.00 27512.00 24322.00
20318.00 19150.00 25845.00 22337.00
20078.00 18924.00 25653.00 21797.00
18077.00 17037.00 23827.00 19781.00
16336.00 15396.00 21971.00 18693.00
16584.00 15630.00 22114.00 18749.00
14889.00 14033.00 19710.00 16805.00
16141.00 15213.00 21444.00 18345.00
16861.00 15892.00 22707.00 19342.00
15624.00 14725.00 21374.00 18005.00
15278.00 14400.00 20814.00 17568.00
15188.00 14315.00 20502.00 17487.00
15436.00 14548.00 20701.00 17812.00
16621.00 15666.00 22407.00 19128.00
17431.00 16428.00 23588.00 20083.00
17603.00 16591.00 23890.00 20360.00
17985.00 16951.00 24310.00 20867.00
18458.00 17397.00 24784.00 21387.00
18008.00 16972.00 24521.00 21158.00
18991.00 17899.00 25909.00 22347.00
19230.00 18125.00 26137.00 22581.00
19680.00 18549.00 27507.00 23363.00
20033.00 18881.00 28013.00 23839.00
20161.00 19002.00 28402.00 23992.00
19973.00 18825.00 27974.00 23546.00
19410.00 18294.00 27534.00 23273.00
19928.00 18783.00 27912.00 23705.00
20251.00 19087.00 28453.00 24002.00
18953.00 17863.00 27511.00 22646.00
08/2004 18697.00 17622.00 27614.00 22534.00
The graph and table do not reflect the deduction of taxes that a shareholder
would pay on fund distributions or the redemption of fund shares. The Standard &
Poor's (S&P) 500 Index is an unmanaged index that tracks the performance of 500
widely held, large-capitalization U.S. stocks. The Russell 1000 Growth Index is
an unmanaged index that measures the performance of those Russell 1000 Index
companies with higher price-to-book ratios and higher forecasted growth values.
Unlike mutual funds, indices are not investments, do not incur fees or expenses
and are not professionally managed. It is not possible to invest directly in an
index. Securities in the fund may not match those in an index.
AVERAGE ANNUAL TOTAL RETURN AS OF 08/31/04 (%)
SHARE CLASS A B C D G Z
- --------------------------------------------------------------------------------------------------------------------------------
INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 11/01/02 06/16/67
- --------------------------------------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- --------------------------------------------------------------------------------------------------------------------------------
1-year 1.30 -4.52 0.53 -4.47 0.29 -0.71 0.57 -1.42 0.61 -4.39 1.58
- --------------------------------------------------------------------------------------------------------------------------------
5-year -7.58 -8.67 -7.82 -8.12 -7.87 -7.87 -7.81 -7.99 7.79 -8.24 -7.46
- --------------------------------------------------------------------------------------------------------------------------------
10-year 6.46 5.83 6.32 6.32 6.29 6.29 6.32 6.22 6.33 6.33 6.53
AVERAGE ANNUAL TOTAL RETURN AS OF 06/30/04 (%)
SHARE CLASS A B C D G Z
- --------------------------------------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- --------------------------------------------------------------------------------------------------------------------------------
1-year 15.04 8.43 14.07 9.07 13.82 12.82 14.21 12.07 14.29 9.29 15.38
- --------------------------------------------------------------------------------------------------------------------------------
5-year -7.27 -8.36 -7.50 -7.80 -7.54 -7.54 -7.49 -7.67 -7.47 -7.92 -7.16
- --------------------------------------------------------------------------------------------------------------------------------
10-year 8.16 7.52 8.03 8.03 8.00 8.00 8.04 7.93 8.05 8.05 8.22
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF
5.75% FOR CLASS A SHARES AND 1% FOR CLASS D SHARES, MAXIMUM CONTINGENT DEFERRED
SALES CHARGE OF 5.00% FOR CLASS B AND CLASS G SHARES AND 1.00% FOR CLASS C AND D
SHARES FOR THE FIRST YEAR ONLY.
ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS, IF ANY. CLASS Z SHARES
ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT
SHARE CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES
ASSOCIATED WITH EACH CLASS.
Effective October 13, 2003, class D shares were closed to all new investors and
new accounts. Existing class D shareholders will be able to make additional
purchases at any time. In addition, the class D initial sales charge of 1.00% is
waived after October 13, 2003.
Performance results reflect any voluntary waivers or reimbursement of fund
expenses by the advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
Classes A, B, D and G (newer class shares) share performance information
includes returns of the fund's class Z shares (the oldest existing fund class)
for periods prior to the inception of the newer class shares. The returns for
class C include the returns of class B prior to 10/13/03, the date on which
class C was initially offered by the fund. The returns shown for class C also
include the performance of class Z prior to the inception of class B (11/01/02).
Class Z share returns are not restated to reflect any expense differential
(e.g., Rule 12b-1 fees) between class Z shares and the newer class shares. Had
the expense differential been reflected, the returns for the periods prior to
the inception of classes A, B, C, D and G would have been lower.
6
[Sidebar]
ESTIMATING YOUR ACTUAL EXPENSES
To estimate the expenses that you paid over the period, first you will need your
account balance at the end of the period:
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS
SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT
WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE
FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE
1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT
BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6
2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD,"
LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE
COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1.
YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING
THE PERIOD
UNDERSTANDING YOUR EXPENSES ____________________________________________________
COLUMBIA GROWTH FUND
As a fund shareholder, you incur two types of costs. There are transaction
costs, which generally include sales charges on purchases and may include
redemption or exchange fees. There are also ongoing costs, which generally
include investment advisory fees, and/or Rule 12b-1 fees, and other fund
expenses. The information on this page is intended to help you understand your
ongoing costs of investing in the fund and to compare these costs with the
ongoing costs of investing in other mutual funds.
ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS
To illustrate these ongoing costs, we have provided an example and calculated
the expenses paid by investors in each share class during the reporting period.
The information in the following table is based on an initial investment of
$1,000, which is invested at the beginning of the reporting period and held for
the entire period. Expense information is calculated two ways and each method
provides you with different information. The amount listed in the "actual"
column is calculated using the fund's actual operating expenses and total return
for the period. The amount listed in the "hypothetical" column for each share
class assumes that the return each year is 5% before expenses and includes the
fund's actual expense ratio. You should not use the hypothetical account values
and expenses to estimate either your actual account balance at the end of the
period or the expenses you paid during this reporting period.
MARCH 1, 2004 - AUGUST 31, 2004
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED
BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%)
- ---------------------------------------------------------------------------------------------------------
ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL
- ---------------------------------------------------------------------------------------------------------
Class A 1,000.00 1,000.00 930.17 1,019.30 5.63 5.89 1.16
- ---------------------------------------------------------------------------------------------------------
Class B 1,000.00 1,000.00 927.00 1,015.53 9.25 9.68 1.91
- ---------------------------------------------------------------------------------------------------------
Class C 1,000.00 1,000.00 926.45 1,015.53 9.25 9.68 1.91
- ---------------------------------------------------------------------------------------------------------
Class D 1,000.00 1,000.00 926.35 1,015.53 9.25 9.68 1.91
- ---------------------------------------------------------------------------------------------------------
Class G 1,000.00 1,000.00 926.90 1,015.79 9.01 9.42 1.86
- ---------------------------------------------------------------------------------------------------------
Class Z 1,000.00 1,000.00 930.82 1,020.56 4.42 4.62 0.91
Expenses paid during the period are equal to the fund's annualized expense
ratio, multiplied by the average account value over the period, then multiplied
by the number of days in the fund's most recent fiscal half-year and divided by
366.
It is important to note that the expense amounts shown in the table are meant to
highlight only ongoing costs of investing in the fund and do not reflect any
transactional costs, such as sales charges, redemption or exchange fees.
Therefore, the hypothetical examples provided may not help you determine the
relative total costs of owning different funds. If these transactional costs
were included, your costs would have been higher.
COMPARE WITH OTHER FUNDS
Since all mutual fund companies are required to include the same hypothetical
calculations about expenses in shareholder reports, you can use this information
to compare the ongoing cost of investing in the fund with other funds. To do so,
compare the 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of other funds. As you compare hypothetical
examples of other funds, it is important to note that hypothetical examples are
meant to highlight the continuing cost of investing in a fund and do not reflect
any transactional costs, such as sales charges or redemption or exchange fees.
7
[Sidebar]
SUMMARY
o FOR THE 12-MONTH PERIOD ENDED AUGUST 31, 2004, THE FUND'S CLASS A SHARES
RETURNED 1.30% WITHOUT SALES CHARGE.
o STOCK SELECTION AND OVERWEIGHT POSITIONS IN TECHNOLOGY AND CONSUMER CYCLICAL
SECTORS HURT PERFORMANCE.
o INDUSTRIAL STOCKS HELPED PERFORMANCE AS WORLDWIDE ECONOMIC GROWTH PICKED UP.
CONSUMER STAPLES STOCKS ALSO PERFORMED WELL AS INVESTORS GREW CONCERNED WITH
A SLOWDOWN IN US ECONOMIC GROWTH.
[Illustration of two arrows pointing up]
RUSSELL 1000
CLASS A SHARES GROWTH INDEX
1.30% 5.36%
OBJECTIVE
Seeks capital appreciation
by investing in stocks of
companies expected to
experience long-term, above
average earnings growth.
TOTAL NET ASSETS
$ 811.0 million
NET ASSET VALUE PER SHARE
AS OF 08/31/04 ($)
Class A 24.93
------------------------------------------
Class B 24.60
------------------------------------------
Class C 24.54
------------------------------------------
Class D 24.62
------------------------------------------
Class G 24.64
------------------------------------------
Class Z 25.09
PORTFOLIO MANAGERS' REPORT _____________________________________________________
COLUMBIA GROWTH FUND
For the 12-month period ended August 31, 2004, Columbia Growth Fund's class A
shares returned 1.30% without sales charge. The fund underperformed its
benchmark the Russell 1000 Growth Index and the S&P 500 Index, which returned
5.36% and 11.46%, respectively, over the same period. The fund also trailed the
Lipper Large Cap Growth Funds Category average, whose average return was 2.90%.
1 The fund's exposure to technology and consumer cyclical stocks was higher than
their weight in the benchmark. This hurt performance because technology and
consumer cyclicals were weak performers during the period. Stock selection in
technology and consumer cyclicals also detracted from the fund's return.
STRONG GAINS FROM INDUSTRIALS, CONSUMER STAPLES SECTORS
The fund's focus on large profitable companies with strong competitive
positions, healthy balance sheets and above-average sales growth led us to top
performers in the industrial and consumer staples sectors. An above-average
stake in industrials helped the fund as economic growth picked up worldwide.
Tyco International, an industrial conglomerate under new management, did
particularly well. We added to the fund's consumer staples holdings, but kept
exposure to the sector lower than the benchmark because valuations have neared
their historical peaks. The fund's strongest performers in consumer staples
included Costco Wholesale, a warehouse chain that sells consumer goods. The
company trimmed costs to improve its bottom line and capitalized on growing
demand from small businesses.
Consumer discretionary stocks also aided performance once the fund was fully
invested. Top performers included XM Satellite Radio Holdings and eBay. XM
benefited from enhanced product offerings and growing demand, while eBay rallied
as more people used its online auction services. Niche retailers Chico's FAS and
Coach also delivered strong results. By contrast, media stocks were
disappointing. Fading expectations for sustainable long-term growth in
advertising revenues put pressure on the sector.
MIXED HEALTH CARE AND TECHNOLOGY RETURNS
The fund's health care returns were mixed. Medical products and devices
companies, such as Alcon and St. Jude Medical, rallied nicely amid new product
introductions. However, the fund lost some ground by not owning more shares of
Johnson & Johnson when its stock price took off in the spring of 2004.
Biotechnology stocks further detracted from performance. In particular, Amgen
was hurt by concerns about Medicare reimbursement rates.
1 Lipper, Inc., a widely respected data provider in the industry, calculates
an average total return for mutual funds with similar investment objectives
as the fund.
8
[Sidebar]
TOP 5 SECTORS AS OF 08/31/04 (%)
Information technology 28.0
------------------------------------------
Health care 21.7
------------------------------------------
Consumer discretionary 13.9
------------------------------------------
Consumer staples 11.2
------------------------------------------
Industrials 10.8
TOP 10 HOLDINGS AS OF 08/31/04 (%)
Microsoft 5.1
------------------------------------------
Tyco International 2.9
------------------------------------------
Pfizer 2.9
------------------------------------------
Intel 2.7
------------------------------------------
Cisco Systems 2.6
------------------------------------------
Praxair 2.4
------------------------------------------
Teva Pharmaceutical Industries 2.3
------------------------------------------
Johnson & Johnson 2.0
------------------------------------------
QUALCOMM 2.0
------------------------------------------
Zimmer Holdings 1.9
HOLDINGS DISCUSSED IN THIS REPORT
AS OF 08/31/04 (%)
Tyco International 2.9
------------------------------------------
Costco Wholesale 1.2
------------------------------------------
XM Satellite Radio Holdings 1.4
------------------------------------------
eBay 1.4
------------------------------------------
Chico's FAS 0.9
------------------------------------------
Coach 1.1
------------------------------------------
Alcon 1.6
------------------------------------------
St. Jude Medical 1.4
------------------------------------------
Johnson & Johnson 2.0
------------------------------------------
Amgen 0.9
------------------------------------------
Cognizant Technology Solutions 1.0
------------------------------------------
QUALCOMM 2.0
Your fund is actively managed and the composition of its portfolio will change
over time. Information provided is calculated as a percentage of net assets.
________________________________________________________________________________
COLUMBIA GROWTH FUND
Within technology, we owned a range of companies we believed could benefit from
an improving economy, increased corporate spending and the growing popularity of
advanced communication devices. However, the technology sector had the largest
negative impact on fund performance. Our exposure to technology was higher than
its weight in the benchmark. That hurt performance because technology lagged the
broader market. Stock selection also detracted from performance. We did well by
overweighting Cognizant Technology Solutions and QUALCOMM. However, the gains we
realized from these stocks were not enough to overcome losses from Seagate
Technology, down 53%, and overweight in Red Hat, both were sold before the end
of the period.
OPTIMISTIC OUTLOOK FOR LARGE-CAP STOCKS
We remain optimistic about the prospects for large-cap growth stocks, especially
those with attractive valuations. We expect high quality companies with
strategic, competitive product positioning to do better than companies whose
fortunes are primarily dependent on the fortunes of the economy. With these
factors in mind, we plan to maintain a diversified and balanced approach to
sector exposure while picking what we believe are growth stocks with the
potential to be market leaders.
Alexander S. Macmillan, CFA, has managed or
co-managed Columbia Growth Fund since 1992 and has
been with the advisor and its predecessors since
1989.
/s/ Alexander S. Macmillan
Paul J. Berlinguet has co-managed the fund
since October 2003 and has been with the advisor and
its predecessors since 2003.
/s/ Paul J. Berlinguet
An investment in the fund may present certain risks, including stock market
fluctuations that occur in response to economic and business developments. The
fund may invest in foreign securities, which have special risks, including
political or economic instability and higher transaction costs; different
regulations, accounting standards, trading practices and levels of information;
and currency exchange rate fluctuations.
The fund's approach offers the potential for long-term growth, but also involves
the possibility of losses due to the sensitivity of growth stock prices to
changes in the current or expected earnings.
On October 13, 2004, the Board of Trustees approved a proposal to reorganize the
Columbia Growth Fund, subject to shareholder approval and the satisfaction of
certain other conditions.
9
PERFORMANCE OF A $ 10,000 INVESTMENT
09/01/94 - 08/31/04 ($)
SALES CHARGE WITHOUT WITH
------------------------------------------
Class A 15,503 14,613
------------------------------------------
Class B 15,229 15,229
------------------------------------------
Class C 15,289 15,289
------------------------------------------
Class D 15,348 15,192
------------------------------------------
Class Z 15,674 n/a
Performance data quoted represents past performance and current performance may
be lower or higher. Past performance is no guarantee of future results. The
investment return and principal value will fluctuate so that shares, when
redeemed, may be worth more or less than the original cost. Please visit
www.columbiafunds.com for daily and most recent month-end performance updates.
PERFORMANCE INFORMATION ________________________________________________________
COLUMBIA INTERNATIONAL STOCK FUND
VALUE OF A $10,000 INVESTMENT 09/01/94 - 08/31/04
[MOUNTAIN CHART]
CLASS A CLASS A MSCI AC
SHARES WITHOUT SHARES WITH WORLD EX US MSCI EAFE
SALES CHARGE SALES CHARGE INDEX INDEX
------------ ------------ ------------ ----------
09/1994 10000.00 9425.00 10000.00 10000.00
9663.00 9107.00 9752.00 9685.00
9964.00 9391.00 10014.00 10008.00
9450.00 8907.00 9532.00 9526.00
9275.00 8741.00 9510.00 9586.00
8566.00 8073.00 9078.00 9218.00
8417.00 7933.00 9029.00 9191.00
8738.00 8235.00 9539.00 9765.00
8932.00 8418.00 9911.00 10132.00
8827.00 8320.00 9867.00 10011.00
8790.00 8285.00 9730.00 9836.00
9372.00 8833.00 10282.00 10449.00
9215.00 8686.00 9925.00 10051.00
9439.00 8897.00 10095.00 10247.00
9335.00 8798.00 9825.00 9971.00
9521.00 8974.00 10056.00 10248.00
9753.00 9192.00 10455.00 10662.00
9879.00 9311.00 10598.00 10705.00
9879.00 9311.00 10598.00 10742.00
10245.00 9656.00 10796.00 10969.00
10633.00 10022.00 11123.00 11289.00
10804.00 10183.00 10956.00 11081.00
10999.00 10367.00 11012.00 11143.00
10431.00 9832.00 10647.00 10818.00
10595.00 9986.00 10709.00 10841.00
10864.00 10240.00 10975.00 11130.00
10805.00 10183.00 10865.00 11016.00
11223.00 10577.00 11285.00 11455.00
11371.00 10717.00 11154.00 11307.00
11363.00 10710.00 10948.00 10911.00
11683.00 11012.00 11149.00 11090.00
11798.00 11119.00 11125.00 11130.00
12076.00 11382.00 11220.00 11189.00
12773.00 12039.00 11912.00 11917.00
13380.00 12610.00 12570.00 12574.00
13781.00 12989.00 12824.00 12778.00
12714.00 11983.00 11814.00 11823.00
13584.00 12803.00 12454.00 12485.00
12641.00 11915.00 11393.00 11525.00
12585.00 11861.00 11250.00 11408.00
12675.00 11946.00 11380.00 11507.00
12777.00 12042.00 11720.00 12033.00
13295.00 12531.00 12502.00 12805.00
13749.00 12958.00 12934.00 13200.00
14091.00 13281.00 13027.00 13304.00
14285.00 13464.00 12790.00 13239.00
14331.00 13507.00 12743.00 13339.00
14414.00 13585.00 12864.00 13474.00
12452.00 11736.00 11050.00 11805.00
11796.00 11118.00 10817.00 11442.00
12749.00 12016.00 11951.00 12635.00
13638.00 12854.00 12592.00 13281.00
14302.00 13480.00 13025.00 13805.00
14737.00 13890.00 13011.00 13763.00
14376.00 13549.00 12720.00 13436.00
14747.00 13899.00 13334.00 13996.00
15201.00 14327.00 14001.00 14563.00
14664.00 13821.00 13343.00 13813.00
15414.00 14527.00 13956.00 14352.00
16043.00 15120.00 14283.00 14778.00
16394.00 15451.00 14333.00 14832.00
16737.00 15774.00 14429.00 14982.00
17644.00 16629.00 14966.00 15544.00
19865.00 18723.00 15564.00 16083.00
22587.00 21288.00 17049.00 17528.00
21507.00 20270.00 16124.00 16415.00
22933.00 21614.00 16559.00 16856.00
22557.00 21260.00 17181.00 17510.00
20685.00 19495.00 16223.00 16589.00
19082.00 17984.00 15807.00 16185.00
19873.00 18731.00 16481.00 16817.00
18963.00 17873.00 15830.00 16113.00
19538.00 18414.00 16026.00 16253.00
18330.00 17276.00 15137.00 15461.00
17509.00 16502.00 14655.00 15096.00
16718.00 15756.00 13999.00 14530.00
17475.00 16470.00 14476.00 15046.00
17381.00 16381.00 14693.00 15039.00
16446.00 15500.00 13530.00 13911.00
15309.00 14429.00 12573.00 12983.00
16255.00 15321.00 13428.00 13885.00
16007.00 15086.00 13057.00 13395.00
15486.00 14596.00 12557.00 12847.00
14978.00 14117.00 12277.00 12613.00
14694.00 13849.00 11973.00 12294.00
13239.00 12478.00 10702.00 11049.00
13606.00 12824.00 11002.00 11332.00
13926.00 13125.00 11505.00 11750.00
14247.00 13428.00 11653.00 11819.00
13619.00 12836.00 11155.00 11192.00
13714.00 12926.00 11235.00 11270.00
14353.00 13528.00 11831.00 11934.00
14425.00 13596.00 11923.00 11958.00
14568.00 13730.00 12053.00 12109.00
14178.00 13362.00 11532.00 11627.00
12958.00 12213.00 10407.00 10480.00
12840.00 12102.00 10409.00 10456.00
11526.00 10863.00 9305.00 9333.00
11944.00 11257.00 9804.00 9834.00
12325.00 11616.00 10276.00 10280.00
11956.00 11269.00 9945.00 9935.00
11421.00 10764.00 9596.00 9521.00
11254.00 10607.00 9401.00 9303.00
11171.00 10528.00 9218.00 9120.00
11944.00 11257.00 10107.00 10014.00
12598.00 11874.00 10751.00 10621.00
12824.00 12086.00 11049.00 10878.00
13169.00 12412.00 11343.00 11141.00
13490.00 12714.00 11681.00 11410.00
13858.00 13061.00 12008.00 11761.00
14679.00 13835.00 12786.00 12494.00
14821.00 13969.00 13065.00 12771.00
15808.00 14899.00 14061.00 13769.00
16129.00 15202.00 14288.00 13963.00
16331.00 15392.00 14651.00 14285.00
16486.00 15538.00 14741.00 14365.00
16046.00 15123.00 14283.00 14041.00
15868.00 14955.00 14329.00 14089.00
16164.00 15235.00 14640.00 14397.00
15534.00 14641.00 14214.00 13929.00
08/2004 15503.00 14613.00 14328.00 13993.00
The graph and table do not reflect the deduction of taxes that a shareholder
would pay on fund distributions or the redemption of fund shares. The Morgan
Stanley Capital International (MSCI) All Country (AC) World ex US Index is an
unmanaged index of global stock market performance that includes developed and
emerging markets but excludes the US. The MSCI Europe, Australasia, Far East
(EAFE) Index is a free float-adjusted market capitalization index that is
designed to measure developed market equity performance, excluding the US and
Canada. Unlike mutual funds, indices are not investments, do not incur fees or
expenses and are not professionally managed. It is not possible to invest
directly in an index. Securities in the fund may not match those in an index.
AVERAGE ANNUAL TOTAL RETURN AS OF 08/31/04 (%)
SHARE CLASS A B C D Z
- ------------------------------------------------------------------------------------------------------------
INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 10/01/92
- ------------------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- ------------------------------------------------------------------------------------------------------------
1-year 14.99 8.38 14.07 9.07 14.51 13.51 14.55 12.45 15.65
- ------------------------------------------------------------------------------------------------------------
5-year -1.11 -2.27 -1.46 -1.77 -1.38 -1.38 -1.31 -1.50 -0.89
- ------------------------------------------------------------------------------------------------------------
10-year 4.48 3.87 4.30 4.30 4.34 4.34 4.38 4.27 4.60
AVERAGE ANNUAL TOTAL RETURN AS OF 06/30/04 (%)
SHARE CLASS A B C D Z
- ------------------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- ------------------------------------------------------------------------------------------------------------
1-year 26.07 18.82 24.95 19.95 25.42 24.42 25.54 23.27 26.83
- ------------------------------------------------------------------------------------------------------------
5-year 0.95 -0.24 0.62 0.31 0.70 0.70 0.77 0.57 1.17
- ------------------------------------------------------------------------------------------------------------
10-year 5.26 4.64 5.09 5.09 5.13 5.13 5.17 5.06 5.37
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF
5.75% FOR CLASS A SHARES AND 1% FOR CLASS D SHARES, MAXIMUM CONTINGENT DEFERRED
SALES CHARGE OF 5.00% FOR CLASS B SHARES AND 1.00% FOR CLASS C AND D SHARES FOR
THE FIRST YEAR ONLY.
ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS, IF ANY. CLASS Z SHARES
ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT
SHARE CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES
ASSOCIATED WITH EACH CLASS.
Effective October 13, 2003, class D shares were closed to all new investors and
new accounts. Existing class D shareholders will be able to make additional
purchases at any time. In addition, the class D initial sales charge of 1.00% is
waived after October 13, 2003.
Performance results reflect any voluntary waivers or reimbursement of fund
expenses by the advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
Classes A, B, and D (newer class shares) share performance information includes
returns of the fund's class Z shares (the oldest existing fund class) for
periods prior to the inception of the newer class shares. The returns for class
C include the returns of class B prior to 10/13/03, the date on which class C
was initially offered by the fund. The returns shown for class C also include
the performance of class Z prior to the inception of class B (11/01/02). Class Z
share returns are not restated to reflect any expense differential (e.g., Rule
12b-1 fees) between class Z shares and the newer class shares. Had the expense
differential been reflected, the returns for the periods prior to the inception
of classes A, B, C and D would have been lower.
10
[Sidebar]
ESTIMATING YOUR ACTUAL EXPENSES
To estimate the expenses that you paid over the period, first you will need your
account balance at the end of the period:
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS
SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT
WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE
FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE
1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT
BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6
2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD,"
LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE
COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1.
YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING
THE PERIOD
UNDERSTANDING YOUR EXPENSES ____________________________________________________
COLUMBIA INTERNATIONAL STOCK FUND
As a fund shareholder, you incur two types of costs. There are transaction
costs, which generally include sales charges on purchases and may include
redemption or exchange fees. There are also ongoing costs, which generally
include investment advisory fees, and/or Rule 12b-1 fees, and other fund
expenses. The information on this page is intended to help you understand your
ongoing costs of investing in the fund and to compare these costs with the
ongoing costs of investing in other mutual funds.
ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS
To illustrate these ongoing costs, we have provided an example and calculated
the expenses paid by investors in each share class during the reporting period.
The information in the following table is based on an initial investment of
$1,000, which is invested at the beginning of the reporting period and held for
the entire period. Expense information is calculated two ways and each method
provides you with different information. The amount listed in the "actual"
column is calculated using the fund's actual operating expenses and total return
for the period. The amount listed in the "hypothetical" column for each share
class assumes that the return each year is 5% before expenses and includes the
fund's actual expense ratio. You should not use the hypothetical account values
and expenses to estimate either your actual account balance at the end of the
period or the expenses you paid during this reporting period.
MARCH 1, 2004 - AUGUST 31, 2004
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED
BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%)
- ---------------------------------------------------------------------------------------------------------
ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL
- ---------------------------------------------------------------------------------------------------------
Class A 1,000.00 1,000.00 951.39 1,016.74 8.19 8.47 1.67
- ---------------------------------------------------------------------------------------------------------
Class B 1,000.00 1,000.00 949.07 1,013.02 11.81 12.19 2.41
- ---------------------------------------------------------------------------------------------------------
Class C 1,000.00 1,000.00 949.07 1,014.38 10.48 10.84 2.14
- ---------------------------------------------------------------------------------------------------------
Class D 1,000.00 1,000.00 949.32 1,014.43 10.44 10.79 2.13
- ---------------------------------------------------------------------------------------------------------
Class Z 1,000.00 1,000.00 954.40 1,019.41 5.60 5.79 1.14
Expenses paid during the period are equal to the fund's annualized expense
ratio, multiplied by the average account value over the period, then multiplied
by the number of days in the fund's most recent fiscal half-year and divided by
366.
Had the Investment Advisor and the Fund's Transfer Agent not waived a portion of
expenses, total return would have been reduced.
It is important to note that the expense amounts shown in the table are meant to
highlight only ongoing costs of investing in the fund and do not reflect any
transactional costs, such as sales charges, redemption or exchange fees.
Therefore, the hypothetical examples provided may not help you determine the
relative total costs of owning different funds. If these transactional costs
were included, your costs would have been higher.
COMPARE WITH OTHER FUNDS
Since all mutual fund companies are required to include the same hypothetical
calculations about expenses in shareholder reports, you can use this information
to compare the ongoing cost of investing in the fund with other funds. To do so,
compare the 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of other funds. As you compare hypothetical
examples of other funds, it is important to note that hypothetical examples are
meant to highlight the continuing cost of investing in a fund and do not reflect
any transactional costs, such as sales charges or redemption or exchange fees.
11
[Sidebar]
SUMMARY
o FOR THE 12-MONTH PERIOD ENDED AUGUST 31, 2004, THE FUND'S CLASS A SHARES
RETURNED 14.99% WITHOUT SALES CHARGE.
o IN AN ENVIRONMENT THAT WAS FAVORABLE FOR STOCKS, THE FUND, ITS BENCHMARK AND
PEER GROUP ALL EARNED DOUBLE DIGIT RETURNS.
o AN EMPHASIS ON TECHNOLOGY AND TELECOMMUNICATIONS STOCKS HURT PERFORMANCE.
SOME OF THE FUND'S JAPANESE HOLDINGS WERE ALSO DISAPPOINTMENTS DURING THE
PERIOD.
[Illustration of two arrows pointing up]
MSCI ALL COUNTRY
CLASS A SHARES WORLD EX US INDEX
14.99% 22.64%
OBJECTIVE
Seeks long-term capital
appreciation by investing in
stocks issued by companies from
at least three countries outside
the United States.
TOTAL NET ASSETS
$ 593.8 million
NET ASSET VALUE PER SHARE
AS OF 08/31/04 ($)
Class A 13.04
------------------------------------------
Class B 12.81
------------------------------------------
Class C 12.86
------------------------------------------
Class D 12.91
------------------------------------------
Class Z 13.14
DISTRIBUTIONS DECLARED PER SHARE
09/01/03 - 08/31/04 ($)
Class A 0.00
------------------------------------------
Class B 0.00
------------------------------------------
Class C 0.00
------------------------------------------
Class D 0.00
------------------------------------------
Class Z 0.04
PORTFOLIO MANAGERS' REPORT _____________________________________________________
COLUMBIA INTERNATIONAL STOCK FUND
For the 12-month period ended August 31, 2004, Columbia International Stock Fund
class A shares returned 14.99% without sales charge. The fund trailed the
benchmark MSCI All Country World ex US Index, which returned 22.64% during the
same period. The fund's return was also slightly lower than the 15.52% average
return of its peer group, the Lipper International Multi-Cap Growth Fund
Category. 1 The portfolio underperformed the benchmark mainly because of its
overweight in the technology sector and its emphasis on certain
telecommunications stocks. Also, some of the fund's Japanese holdings were
disappointments during the period.
A CHANGING INVESTMENT ENVIRONMENT
There were two distinct market environments during the 12-month reporting
period. During the first six months, low valuations, underestimated earnings
growth and the global economic recovery provided a positive backdrop. During
this period, the fund's sizeable technology allocation helped performance.
However, in February the market environment began to change. Valuations began to
look less attractive, fewer companies upgraded earnings estimates and concerns
arose about slowing global growth and rising interest rates. In this
environment, the fund's relatively large technology weight detracted from its
return.
BOOSTING INVESTMENT IN JAPAN, THE UNITED KINGDOM AND AUSTRIA
The fund benefited from our regional allocation decisions. We reduced exposure
to emerging markets, which helped the fund because emerging markets
significantly underperformed developed markets. We used the proceeds from the
sale of emerging market stocks to invest in Japan and the United Kingdom (UK),
where the prospects for long-term economic growth appeared stronger.
In Japan, the economy continued to recover from a 10-year deflationary cycle.
Companies have become more competitive on a global basis and the Japanese
government has demonstrated a willingness to be more accommodative toward
business. Yet, some of our Japanese holdings were disappointments during the
period. A long-term favorite of ours, wireless communications company NTT
DoCoMo, reported lower earnings as it came up against heavy competition from
companies that had better technology and offered customers more favorable
pricing. The company also suffered from government policies aimed at controlling
telephone rates. We recently increased our position in the stock because we
believed it was attractively priced relative to its future earnings prospects.
The company appears to have stemmed its earnings decline, upgraded its
technology and improved its pricing.
In the UK, we were drawn to the region's consistent GDP growth, relatively
strong consumer spending and attractive housing sector. Our investments
1 Lipper Inc., a widely respected data provider in the industry, calculates an
average total return for mutual funds with similar investment objectives as
those of the fund.
12
[Sidebar]
TOP 5 COUNTRIES AS OF 08/31/04 (%)
United Kingdom 25.2
------------------------------------------
Japan 20.0
------------------------------------------
France 10.7
------------------------------------------
Germany 6.8
------------------------------------------
Switzerland 5.0
TOP 10 HOLDINGS AS OF 08/31/04 (%)
ENI S.p.A. 2.4
------------------------------------------
BP PLC 2.3
------------------------------------------
Nestle SA 1.8
------------------------------------------
Vodafone Group PLC 1.8
------------------------------------------
GlaxoSmithKline PLC 1.6
------------------------------------------
ING Groep NV 1.6
------------------------------------------
Reckitt Benckiser PLC 1.6
------------------------------------------
Takeda Pharmaceutical 1.5
------------------------------------------
Toyota Motor 1.5
------------------------------------------
E.ON AG 1.5
HOLDINGS DISCUSSED IN THIS REPORT
AS OF 08/31/04 (%)
NTT DoCoMo 0.7
------------------------------------------
BP PLC 2.3
------------------------------------------
GlaxoSmithKline PLC 1.6
------------------------------------------
Erste Bank 0.5
------------------------------------------
Wienerberger AG 0.5
Your fund is actively managed and the composition of its portfolio will change
over time. Information provided is calculated as a percentage of net assets.
________________________________________________________________________________
COLUMBIA INTERNATIONAL STOCK FUND
in BP PLC, a large integrated-energy company, and in GlaxoSmithKline PLC, a
global pharmaceutical company, were positive for performance.
We also invested in Austria where we emphasized companies with exposure to East
European countries that have entered the European Union. We added Erste Bank,
which has had a significant pick-up in loan growth, and Wienerberger AG, the
world's largest producer of bricks used in construction projects. Both companies
benefited performance.
REDUCED EXPOSURE TO THAILAND
During the period, we reduced our position in Thailand from approximately 4.2%
to approximately 0.5% of net assets. Investments in Thailand aided return for
several years, as the country benefited from the global economic recovery, a
pro-business government and brisk trading activity with China, Japan and the
United States. However, in the last few months of the period, Thailand's
business policies became less expansionary, and we became concerned that the
country's export growth had the potential to decline in a cooling global
economy.
BECOMING MORE DEFENSIVE
We believe that concerns about the pace of global economic growth and rising
interest rates will continue to weigh on the market for several months. With
this expectation, we have structured the portfolio more defensively, we cut back
the fund's exposure to small companies and focused on large, established
companies with dividend-paying potential in sectors such as pharmaceuticals,
consumer staples and energy. We believe more cautious positioning may help the
fund weather this period of uncertainty.
[PHOTO OF Penelope L. Burgess] Penelope L. Burgess has co-managed the fund
since July 2004 and has been with the advisor
and its predecessors since 1993.
/s/ Penelope L. Burgess
[PHOTO OF Deborah F. Snee] Deborah F. Snee has co-managed the fund since
July 2004 and has been with the advisor and
its predecessors since 1999.
/s/ Deborah F. Snee
An investment in the fund offers the potential for long-term growth, but also
involves certain risks, including stock market fluctuations due to economic and
business developments. There are also specific risks involved when investing in
foreign stocks, such as currency exchange rate fluctuations, economic change,
instability of emerging countries and political developments.
13
[Sidebar]
PERFORMANCE OF A $10,000 INVESTMENT
09/01/94 - 08/31/04 ($)
SALES CHARGE WITHOUT WITH
------------------------------------------
Class A 20,402 19,230
------------------------------------------
Class B 20,114 20,114
------------------------------------------
Class C 20,162 20,162
------------------------------------------
Class D 20,138 19,939
------------------------------------------
Class G 20,054 20,054
------------------------------------------
Class T 20,450 19,275
------------------------------------------
Class Z 20,582 n/a
Performance data quoted represents past performance and current performance may
be lower or higher. Past performance is no guarantee of future results. The
investment return and principal value will fluctuate so that shares, when
redeemed, may be worth more or less than the original cost. Please visit
www.columbiafunds.com for daily and most recent month-end performance updates.
PERFORMANCE INFORMATION ________________________________________________________
COLUMBIA MID CAP GROWTH FUND
VALUE OF A $10,000 INVESTMENT 09/01/94 - 08/31/04
[MOUNTAIN CHART]
CLASS A CLASS A
SHARES WITHOUT SHARES WITH RUSSELL MIDCAP RUSSELL MIDCAP
SALES CHARGE SALES CHARGE GROWTH INDEX INDEX
-------------- ------------ -------------- -------------
09/1994 10000.00 9425.00 10000.00 10000.00
9975.00 9401.00 9835.00 9756.00
10230.00 9642.00 10005.00 9830.00
9785.00 9223.00 9564.00 9397.00
9973.00 9400.00 9698.00 9519.00
9871.00 9304.00 9814.00 9714.00
10213.00 9626.00 10336.00 10217.00
10485.00 9882.00 10747.00 10509.00
10517.00 9912.00 10837.00 10668.00
10640.00 10028.00 11104.00 11019.00
11318.00 10667.00 11609.00 11389.00
12177.00 11477.00 12339.00 11943.00
12380.00 11669.00 12475.00 12125.00
12577.00 11854.00 12753.00 12400.00
12054.00 11361.00 12430.00 12122.00
12705.00 11974.00 12986.00 12724.00
12917.00 12174.00 12992.00 12798.00
12820.00 12083.00 13222.00 13068.00
13392.00 12622.00 13722.00 13375.00
13718.00 12929.00 13830.00 13569.00
14916.00 14059.00 14498.00 13953.00
15339.00 14457.00 14794.00 14164.00
14460.00 13628.00 14347.00 13951.00
13044.00 12294.00 13234.00 13088.00
13840.00 13044.00 13950.00 13711.00
14375.00 13549.00 14836.00 14388.00
13971.00 13168.00 14662.00 14503.00
14748.00 13900.00 15526.00 15386.00
14605.00 13765.00 15265.00 15229.00
14951.00 14092.00 15940.00 15799.00
14717.00 13870.00 15589.00 15775.00
14003.00 13198.00 14708.00 15105.00
13899.00 13100.00 15069.00 15481.00
15202.00 14327.00 16419.00 16611.00
15694.00 14792.00 16874.00 17154.00
16578.00 15624.00 18488.00 18585.00
16526.00 15576.00 18307.00 18382.00
17328.00 16331.00 19234.00 19432.00
16319.00 15381.00 18270.00 18676.00
16489.00 15541.00 18462.00 19121.00
16453.00 15507.00 18704.00 19648.00
16013.00 15093.00 18367.00 19279.00
17037.00 16057.00 20094.00 20787.00
18117.00 17075.00 20935.00 21772.00
18061.00 17022.00 21220.00 21826.00
17589.00 16578.00 20348.00 21152.00
17874.00 16846.00 20924.00 21446.00
16655.00 15698.00 20028.00 20423.00
14568.00 13731.00 16205.00 17155.00
15584.00 14688.00 17430.00 18265.00
16234.00 15300.00 18713.00 19511.00
16980.00 16004.00 19976.00 20434.00
19191.00 18088.00 22046.00 21631.00
18802.00 17720.00 22707.00 21594.00
17250.00 16259.00 21597.00 20875.00
17739.00 16719.00 22799.00 21529.00
18315.00 17262.00 23839.00 23120.00
18365.00 17309.00 23532.00 23053.00
19648.00 18518.00 25174.00 23866.00
19135.00 18035.00 24374.00 23210.00
18778.00 17698.00 24120.00 22609.00
19037.00 17942.00 23915.00 21813.00
20183.00 19022.00 25764.00 22847.00
22677.00 21373.00 28433.00 23505.00
26163.00 24658.00 33357.00 25573.00
26608.00 25078.00 33351.00 24727.00
34196.00 32230.00 40361.00 26628.00
33646.00 31711.00 40401.00 28154.00
30358.00 28613.00 36478.00 26822.00
28698.00 27048.00 33819.00 26112.00
31880.00 30047.00 37407.00 26885.00
30621.00 28860.00 35039.00 26583.00
34905.00 32898.00 40323.00 29130.00
34172.00 32207.00 38352.00 28714.00
31787.00 29959.00 35728.00 28271.00
27181.00 25618.00 27965.00 25727.00
29788.00 28075.00 29438.00 27685.00
29272.00 27589.00 31119.00 28131.00
25982.00 24488.00 25736.00 26417.00
23748.00 22382.00 22053.00 24780.00
26018.00 24522.00 25729.00 26898.00
25594.00 24122.00 25608.00 27398.00
25123.00 23678.00 25621.00 27141.00
24206.00 22814.00 23894.00 26365.00
22831.00 21518.00 22162.00 25350.00
20251.00 19087.00 18498.00 22292.00
20984.00 19778.00 20443.00 23175.00
22703.00 21397.00 22644.00 25117.00
23536.00 22183.00 23505.00 26127.00
22743.00 21435.00 22741.00 25970.00
21722.00 20473.00 21451.00 25695.00
23005.00 21683.00 23088.00 27237.00
22416.00 21127.00 21867.00 26708.00
22056.00 20787.00 21215.00 26407.00
20531.00 19351.00 18873.00 24637.00
18959.00 17869.00 17039.00 22233.00
18515.00 17451.00 16979.00 22355.00
17699.00 16681.00 15631.00 20292.00
18191.00 17145.00 16842.00 21316.00
18707.00 17632.00 18161.00 22796.00
17734.00 16715.00 17064.00 21898.00
17734.00 16715.00 16897.00 21455.00
17327.00 16330.00 16750.00 21172.00
17434.00 16432.00 17061.00 21382.00
18311.00 17258.00 18223.00 22934.00
19884.00 18741.00 19976.00 25032.00
20208.00 19046.00 20262.00 25285.00
20640.00 19454.00 20985.00 26120.00
21722.00 20473.00 22142.00 27253.00
20558.00 19376.00 21712.00 26913.00
22215.00 20937.00 23462.00 28966.00
22828.00 21515.00 24091.00 29780.00
23031.00 21707.00 24353.00 30673.00
23524.00 22171.00 25157.00 31566.00
23451.00 22102.00 25580.00 32245.00
23212.00 21877.00 25531.00 32251.00
22095.00 20825.00 24811.00 31067.00
22382.00 21095.00 25397.00 31838.00
22899.00 21583.00 25800.00 32720.00
20859.00 19660.00 24092.00 31290.00
08/2004 20402.00 19230.00 23791.00 31421.00
The graph and table do not reflect the deduction of taxes that a shareholder
would pay on fund distributions or the redemption of fund shares. The Russell
MidCap Growth Index is an unmanaged index that measures the performance of those
Russell MidCap companies with higher price-to-book ratios and higher forecasted
growth values. The Russell MidCap Index is an unmanaged index that measures the
performance of the 800 smallest companies in the Russell 1000 Index, as ranked
by total market capitalization. Unlike mutual funds, indices are not
investments, do not incur fees or expenses and are not professionally managed.
It is not possible to invest directly in an index. Securities in the fund may
not match those in an index.
AVERAGE ANNUAL TOTAL RETURN AS OF 08/31/04 (%)
SHARE CLASS A B C D G T Z
- ------------------------------------------------------------------------------------------------------------------------------------
INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 11/01/02 11/01/02 11/20/85
- ------------------------------------------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- ------------------------------------------------------------------------------------------------------------------------------------
1-year -6.08 -11.48 -6.84 -11.50 -6.62 -7.55 -6.73 -8.59 -7.12 -11.76 -6.02 -11.44 -5.67
- ------------------------------------------------------------------------------------------------------------------------------------
5-year 1.67 0.48 1.38 1.11 1.43 1.43 1.41 1.21 1.32 0.91 1.72 0.52 1.85
- ------------------------------------------------------------------------------------------------------------------------------------
10-year 7.39 6.76 7.24 7.24 7.26 7.26 7.25 7.14 7.21 7.21 7.42 6.78 7.49
AVERAGE ANNUAL TOTAL RETURN AS OF 06/30/04 (%)
SHARE CLASS A B C D G T Z
- ------------------------------------------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- ------------------------------------------------------------------------------------------------------------------------------------
1-year 13.31 6.79 12.35 7.35 12.59 11.59 12.54 10.42 12.06 7.06 13.35 6.82 13.85
- ------------------------------------------------------------------------------------------------------------------------------------
5-year 3.11 1.89 2.85 2.57 2.89 2.89 2.87 2.67 2.78 2.36 3.15 1.94 3.28
- ------------------------------------------------------------------------------------------------------------------------------------
10-Year 9.31 8.66 9.17 9.17 9.19 9.19 9.18 9.07 9.13 9.13 9.33 8.68 9.40
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF
5.75% FOR CLASS A SHARES AND CLASS T AND 1% FOR CLASS D SHARES, MAXIMUM
CONTINGENT DEFERRED SALES CHARGE OF 5.00% FOR CLASS B AND CLASS G SHARES AND
1.00% FOR CLASS C AND D SHARES FOR THE FIRST YEAR ONLY.
ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS, IF ANY. CLASS Z SHARES
ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT
SHARE CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES
ASSOCIATED WITH EACH CLASS.
Effective October 13, 2003, class D shares were closed to all new investors and
new accounts. Existing class D shareholders will be able to make additional
purchases at any time. In addition, the class D initial sales charge of 1.00% is
waived after October 13, 2003.
Performance results reflect any voluntary waivers or reimbursement of fund
expenses by the advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
Classes A, B, D, G and T (newer class shares) share performance information
includes returns of the fund's class Z shares (the oldest existing fund class)
for periods prior to the inception of the newer class shares. The returns for
class C include the returns of class B prior to 10/13/03, the date on which
class C was initially offered by the fund. The returns shown for class C also
include the performance of class Z prior to the inception of class B (11/01/02).
Class Z share returns are not restated to reflect any expense differential
(e.g., Rule 12b-1 fees) between class Z shares and the newer class shares. Had
the expense differential been reflected, the returns for the periods prior to
the inception of classes A, B, C, D, G and T would have been lower.
14
[Sidebar]
ESTIMATING YOUR ACTUAL EXPENSES
To estimate the expenses that you paid over the period, first you will need your
account balance at the end of the period:
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS
SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT
WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE
FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE
1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT
BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6
2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD,"
LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE
COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1.
YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING
THE PERIOD
UNDERSTANDING YOUR EXPENSES ____________________________________________________
COLUMBIA MID CAP GROWTH FUND
As a fund shareholder, you incur two types of costs. There are transaction
costs, which generally include sales charges on purchases and may include
redemption or exchange fees. There are also ongoing costs, which generally
include investment advisory fees, and/or Rule 12b-1 fees, and other fund
expenses. The information on this page is intended to help you understand your
ongoing costs of investing in the fund and to compare these costs with the
ongoing costs of investing in other mutual funds.
ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS
To illustrate these ongoing costs, we have provided an example and calculated
the expenses paid by investors in each share class during the reporting period.
The information in the following table is based on an initial investment of
$1,000, which is invested at the beginning of the reporting period and held for
the entire period. Expense information is calculated two ways and each method
provides you with different information. The amount listed in the "actual"
column is calculated using the fund's actual operating expenses and total return
for the period. The amount listed in the "hypothetical" column for each share
class assumes that the return each year is 5% before expenses and includes the
fund's actual expense ratio. You should not use the hypothetical account values
and expenses to estimate either your actual account balance at the end of the
period or the expenses you paid during this reporting period.
MARCH 1, 2004 - AUGUST 31, 2004
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED
BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%)
- ---------------------------------------------------------------------------------------------------------
ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL
- ---------------------------------------------------------------------------------------------------------
Class A 1,000.00 1,000.00 876.98 1,017.34 7.31 7.86 1.55
- ---------------------------------------------------------------------------------------------------------
Class B 1,000.00 1,000.00 872.81 1,013.67 10.73 11.54 2.28
- ---------------------------------------------------------------------------------------------------------
Class C 1,000.00 1,000.00 873.61 1,014.18 10.27 11.04 2.18
- ---------------------------------------------------------------------------------------------------------
Class D 1,000.00 1,000.00 873.41 1,014.08 10.36 11.14 2.20
- ---------------------------------------------------------------------------------------------------------
Class G 1,000.00 1,000.00 870.50 1,012.02 12.27 13.20 2.61
- ---------------------------------------------------------------------------------------------------------
Class T 1,000.00 1,000.00 876.43 1,017.50 7.17 7.71 1.52
- ---------------------------------------------------------------------------------------------------------
Class Z 1,000.00 1,000.00 878.44 1,019.56 5.24 5.63 1.11
Expenses paid during the period are equal to the fund's annualized expense
ratio, multiplied by the average account value over the period, then multiplied
by the number of days in the fund's most recent fiscal half-year and divided by
366.
Had the Fund's Transfer Agent not waived a portion of expenses, total return
would have been reduced.
It is important to note that the expense amounts shown in the table are meant to
highlight only ongoing costs of investing in the fund and do not reflect any
transactional costs, such as sales charges, redemption or exchange fees.
Therefore, the hypothetical examples provided may not help you determine the
relative total costs of owning different funds. If these transactional costs
were included, your costs would have been higher.
COMPARE WITH OTHER FUNDS
Since all mutual fund companies are required to include the same hypothetical
calculations about expenses in shareholder reports, you can use this information
to compare the ongoing cost of investing in the fund with other funds. To do so,
compare the 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of other funds. As you compare hypothetical
examples of other funds, it is important to note that hypothetical examples are
meant to highlight the continuing cost of investing in a fund and do not reflect
any transactional costs, such as sales charges or redemption or exchange fees.
15
[Sidebar]
SUMMARY
o FOR THE 12-MONTH PERIOD ENDED AUGUST 31, 2004, THE FUND'S CLASS A SHARES
RETURNED NEGATIVE 6.08% WITHOUT SALES CHARGE.
o THE FUND UNDERPERFORMED ITS BENCHMARKS, THE RUSSELL MIDCAP GROWTH INDEX AND
THE RUSSELL MIDCAP INDEX, AS WELL AS ITS PEER GROUP, THE LIPPER MIDCAP
GROWTH FUNDS CATEGORY.
o WITH A NEW MANAGEMENT TEAM AND A NEW, MORE DISCIPLINED INVESTMENT APPROACH
IN PLACE, WE BELIEVE THE FUND IS POSITIONED FOR POTENTIALLY BETTER
PERFORMANCE GOING FORWARD.
[Illustration of an arrow pointing down and two arrows pointing up]
RUSSELL RUSSELL
CLASS A MIDCAP MIDCAP
SHARES GROWTH INDEX INDEX
-6.08% 7.46% 15.29%
OBJECTIVE
Seeks significant capital
appreciation by investing in
stocks of companies with a
market capitalization, at the
time of initial purchase, equal to
or less than the largest stock in
the Russell MidCap Index.
TOTAL NET ASSETS
$ 862.5 million
NET ASSET VALUE PER SHARE
AS OF 08/31/04 ($)
Class A 16.99
------------------------------------------
Class B 16.75
------------------------------------------
Class C 16.79
------------------------------------------
Class D 16.77
------------------------------------------
Class G 16.70
------------------------------------------
Class T 17.03
------------------------------------------
Class Z 17.14
PORTFOLIO MANAGERS' REPORT _____________________________________________________
COLUMBIA MID CAP GROWTH FUND
For the 12-month period ended August 31, 2004, Columbia Mid Cap Growth Fund
class A shares returned negative 6.08% without sales charge. The fund
underperformed both the Russell MidCap Growth Index and the Russell MidCap
Index, which returned 7.46% and 15.29%, respectively, during the same period.
The fund also trailed its peer group, the Lipper MidCap Growth Funds Category
average, which was 2.26%. 1 Although the fund's energy holdings benefited from
rising oil prices, its lack of exposure to the better-performing segments of the
market, particularly technology, hurt performance during the overall period.
With a new management team in place, we have taken steps aimed at reducing
volatility and improving performance going forward.
SMALL COMPANY STOCKS HURT AS INVESTOR FOCUS SHIFTS TO LARGER COMPANIES
Fueled by a strengthening US economy, the stock market moved higher during the
first six months of this reporting period. Small company stocks were the
greatest beneficiaries of this trend. Investors favored small and highly
leveraged, speculative companies on the expectation that they had the most to
gain in an improving economy. However, that sentiment changed dramatically as
investors became concerned about the strength of the recovery early in 2004.
Investors shifted their support to larger, more stable companies.
The fund's technology holdings detracted from performance during the reporting
period. We missed most of the major upward moves within the technology sector.
ENERGY AND HEALTH CARE STOCKS DELIVER SOLID RETURNS
The fund was helped by some of its energy and health care holdings. Rising oil
prices boosted energy stocks and oil service stocks benefited most because
companies have begun to explore for more energy sources after years of
underinvestment. XTO Energy and National-Oilwell, as well as exploration and
production companies such as Apache, were helped by this trend. In health care,
a few high quality stocks made positive contributions to the fund, including
DaVita, a dialysis services company, and Elan, an Irish biotechnology and drug
company.
1 Lipper Inc., a widely respected data provider in the industry,calculates an
average total return for mutual funds with similar investment objectives as
those of the fund.
16
[Sidebar]
TOP 5 SECTORS AS OF 08/31/04 (%)
Information technology 24.9
------------------------------------------
Health care 21.5
------------------------------------------
Consumer discretionary 16.3
------------------------------------------
Industrials 10.8
------------------------------------------
Energy 7.2
TOP 10 HOLDINGS AS OF 08/31/04 (%)
Medicis Pharmaceutical 2.0
------------------------------------------
Yum! Brands 1.7
------------------------------------------
DaVita 1.6
------------------------------------------
Univision Communications 1.6
------------------------------------------
Fisher Scientific International 1.4
------------------------------------------
Potash Corp. of Saskatchewan 1.4
------------------------------------------
Kinetic Concepts 1.4
------------------------------------------
Corporate Executive Board 1.4
------------------------------------------
Manpower 1.4
------------------------------------------
ChoicePoint 1.3
HOLDINGS DISCUSSED IN THIS REPORT
AS OF 08/31/04 (%)
XTO Energy 0.8
------------------------------------------
National-Oilwell 1.2
------------------------------------------
Apache 0.5
------------------------------------------
DaVita 1.6
------------------------------------------
Elan 0.9
------------------------------------------
Advanced Micro Devices 0.6
------------------------------------------
Altera 0.7
------------------------------------------
Juniper Networks 1.0
Your fund is actively managed and the composition of its portfolio will change
over time. Information provided is calculated as a percentage of net assets.
________________________________________________________________________________
COLUMBIA MID CAP GROWTH FUND
ENCOURAGING OUTLOOK FOR ECONOMY AND STOCK MARKET
Although US stock markets have traded lower for the past few months, we see
reasons for optimism--and attractive investment opportunities--going forward. In
light of our expectation for modest but stable growth, we believe that stocks
are more attractively priced. Given this outlook, we have begun adding stocks of
emerging companies with favorable earnings prospects. For example, we added
Advanced Micro Devices and Altera, two semiconductor manufacturers. We also
initiated a position in Juniper Networks, a communications equipment company. We
initiated positions in these stocks even though we reduced the fund's overall
exposure to technology. At the same time, we added to the fund's financial
services and materials holdings. We believe these two sectors have the potential
to benefit from an improving economy, and both made positive contributions to
performance for the period.
MORE DISCIPLINED INVESTMENT APPROACH IN PLACE
As part of a major restructuring of the fund, we have taken steps to limit
exposure to any one industry in order to help manage exposure to risk. We have
also introduced a systematic process that places more emphasis on valuation
relative to earnings growth in selecting individual stocks for the portfolio.
With a new management team and a new, more disciplined investment approach in
place, we believe that the fund is positioned for potentially better performance
going forward.
Kenneth A. Korngiebel has co-managed the fund since
June 2004 and has been with the advisor and its
predecessors since 1996.
/s/ Kenneth A. Korngiebel
Trent E. Nevills has co-managed the fund since June
2004 and has been with the advisor and its
predecessors since 2003.
/s/ Trent E. Nevills
An investment in the fund offers the potential for long-term growth, but also
involves certain risks, including stock market fluctuations due to economic and
business developments. Mid-cap stocks can present special risks including
greater price volatility than stocks of larger, more established companies.
17
[Sidebar]
PERFORMANCE OF A $10,000 INVESTMENT
10/01/96 - 08/31/04 ($)
SALES CHARGE WITHOUT
------------------------------------------
Class Z 20,978
Performance data quoted represents past performance and current performance may
be lower or higher. Past performance is no guarantee of future results. The
investment return and principal value will fluctuate so that shares, when
redeemed, may be worth more or less than the original cost. Please visit
www.columbiafunds.com for daily and most recent month-end performance updates.
PERFORMANCE INFORMATION ________________________________________________________
COLUMBIA SMALL CAP GROWTH FUND
VALUE OF A $10,000 INVESTMENT 10/01/96 - 08/31/04
[MOUNTAIN CHART]
CLASS Z SHARES
WITHOUT SALES RUSSELL 2000 RUSSELL 2000
CHARGE INDEX GROWTH INDEX
-------------- ------------ ------------
10/1996 10000.00 10000.00 10000.00
10174.00 9876.00 9628.00
10488.40 10282.90 9895.66
10762.10 10552.30 10088.60
11507.90 10763.30 10340.80
10819.80 10502.90 9716.25
10223.60 10007.10 9030.29
10190.90 10035.20 8925.53
11474.90 11151.10 10267.00
12244.90 11629.50 10615.10
13098.40 12170.20 11158.60
13753.30 12448.90 11493.30
15021.30 13360.20 12410.50
14449.00 12773.70 11664.60
14200.50 12690.60 11387.00
14432.00 12912.70 11393.90
13817.20 12708.70 11242.30
14952.90 13647.90 12235.00
16261.30 14210.20 12747.70
16435.30 14288.30 12825.40
15247.00 13518.20 11893.00
15715.10 13546.60 12014.30
14978.10 12449.30 11011.10
11771.30 10031.60 8469.76
12854.20 10817.10 9328.59
12984.10 11258.50 9815.54
13720.30 11848.40 10577.20
15108.80 12581.80 11534.50
15030.20 12749.20 12053.50
13452.00 11716.50 10950.60
13678.00 11899.30 11340.50
14077.40 12965.40 12341.80
14381.50 13154.70 12361.60
15681.60 13749.30 13013.00
16089.30 13372.60 12610.90
15725.70 12877.80 12139.30
16002.40 12880.40 12373.60
17554.70 12933.20 12690.30
19964.90 13705.30 14031.70
24047.80 15256.70 16505.50
24249.80 15011.10 16352.00
30794.80 17489.40 20157.10
29559.90 16336.90 18038.60
26349.70 15353.40 16216.70
24884.70 14458.30 14796.10
28385.90 15719.10 16707.80
26205.90 15212.90 15275.90
29285.10 16373.70 16882.90
28066.80 15892.30 16043.90
26663.50 15183.50 14741.10
23453.20 13624.10 12064.10
25451.40 14794.40 12802.40
25767.00 15565.20 13838.10
22981.60 14544.20 11940.90
20993.70 13832.90 10855.50
23433.20 14914.70 12184.20
23599.50 15281.60 12466.90
23984.20 15808.80 12807.20
22785.00 14953.50 11714.80
21092.10 14470.50 10982.60
17835.50 12522.80 9210.02
19105.30 13255.40 10096.00
20452.30 14281.40 10939.00
21838.90 15162.50 11620.50
21249.30 15004.80 11206.80
20197.40 14593.70 10481.80
21534.50 15765.60 11392.60
20856.20 15909.00 11146.50
20088.70 15202.70 10494.50
18740.70 14448.60 9604.54
16203.20 12266.90 8128.33
16459.20 12236.20 8124.26
15751.50 11357.70 7537.69
16027.10 11722.20 7919.10
16942.30 12767.90 8703.88
16037.60 12056.70 8103.31
15987.90 11722.70 7882.90
15741.60 11368.70 7672.43
16056.50 11515.30 7788.28
17345.80 12607.00 8525.05
18950.30 13959.70 9485.83
19422.20 14212.40 9668.90
20140.80 15102.10 10399.90
21272.70 15793.80 10958.30
20623.90 15501.60 10681.10
22669.80 16803.70 11603.90
23191.20 17400.30 11982.20
23142.50 17753.50 12036.20
24519.40 18524.00 12668.10
24431.20 18690.70 12649.10
24135.50 18864.50 12708.50
22926.40 17902.40 12070.50
23320.70 18187.10 12310.70
24029.60 18952.80 12720.70
21816.50 17677.20 11578.40
08/2004 20978.00 17591.00 11332.00
The graph and table do not reflect a deduction of the taxes that a shareholder
would pay on fund distributions or the redemption of fund shares. The Russell
2000 Index is an unmanaged index that tracks the performance of the 2,000
smallest of the 3,000 largest U.S. companies based on market capitalization. The
Russell 2000 Growth Index is an unmanaged index that measures the performance of
those Russell 2000 Index companies with higher price-to-book ratios and higher
forecasted growth values. Unlike mutual funds, indices are not investments, do
not incur fees or expenses and are not professionally managed. It is not
possible to invest directly in an index. Securities in the fund may not match
those in an index. Index performance is from October 1, 1996.
AVERAGE ANNUAL TOTAL RETURN AS OF 08/31/04 (%)
SHARE CLASS Z
------------------------------------------
INCEPTION 10/01/96
------------------------------------------
SALES CHARGE WITHOUT
------------------------------------------
1-year -1.39
------------------------------------------
5-year 5.93
------------------------------------------
Life 9.81
AVERAGE ANNUAL TOTAL RETURN AS OF 06/30/04 (%)
SHARE CLASS Z
------------------------------------------
SALES CHARGE WITHOUT
------------------------------------------
1-year 23.71
------------------------------------------
5-year 8.91
------------------------------------------
Life 11.98
ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS. CLASS Z SHARES ARE SOLD
AT NET ASSET VALUE WITH NO RULE 12B-1 FEES.
Performance results reflect any voluntary waivers or reimbursement of fund
expenses by the advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
18
[Sidebar]
ESTIMATING YOUR ACTUAL EXPENSES
To estimate the expenses that you paid over the period, first you will need your
account balance at the end of the period:
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS
SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT
WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE
FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE
1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT
BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6
2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD,"
LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE
COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1.
YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING
THE PERIOD
UNDERSTANDING YOUR EXPENSES ____________________________________________________
COLUMBIA SMALL CAP GROWTH FUND
As a fund shareholder, you incur two types of costs. There are transaction
costs, which generally include sales charges on purchases and may include
redemption or exchange fees. There are also ongoing costs, which generally
include investment advisory fees and other fund expenses. The information on
this page is intended to help you understand your ongoing costs of investing in
the fund and to compare these costs with the ongoing costs of investing in other
mutual funds.
ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS
To illustrate these ongoing costs, we have provided an example and calculated
the expenses paid by investors in each share class during the reporting period.
The information in the following table is based on an initial investment of
$1,000, which is invested at the beginning of the reporting period and held for
the entire period. Expense information is calculated two ways and each method
provides you with different information. The amount listed in the "actual"
column is calculated using the fund's actual operating expenses and total return
for the period. The amount listed in the "hypothetical" column for each share
class assumes that the return each year is 5% before expenses and includes the
fund's actual expense ratio. You should not use the hypothetical account values
and expenses to estimate either your actual account balance at the end of the
period or the expenses you paid during this reporting period.
MARCH 1, 2004 - AUGUST 31, 2004
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED
BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%)
- ---------------------------------------------------------------------------------------------------------
ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL
- ---------------------------------------------------------------------------------------------------------
Class Z 1,000.00 1,000.00 867.88 1,019.41 5.35 5.79 1.14
Expenses paid during the period are equal to the fund's annualized expense
ratio, multiplied by the average account value over the period, then multiplied
by the number of days in the fund's most recent fiscal half-year and divided by
366.
It is important to note that the expense amounts shown in the table are meant to
highlight only ongoing costs of investing in the fund and do not reflect any
transactional costs, such as sales charges, redemption or exchange fees.
Therefore, the hypothetical examples provided may not help you determine the
relative total costs of owning different funds. If these transactional costs
were included, your costs would have been higher.
COMPARE WITH OTHER FUNDS
Since all mutual fund companies are required to include the same hypothetical
calculations about expenses in shareholder reports, you can use this information
to compare the ongoing cost of investing in the fund with other funds. To do so,
compare the 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of other funds. As you compare hypothetical
examples of other funds, it is important to note that hypothetical examples are
meant to highlight the continuing cost of investing in a fund and do not reflect
any transactional costs, such as sales charges or redemption or exchange fees.
19
[Sidebar]
SUMMARY
o FOR THE 12-MONTH PERIOD ENDED AUGUST 31, 2004, THE FUND'S CLASS Z SHARES
RETURNED NEGATIVE 1.39% WITHOUT SALES CHARGE.
o THE FUND DID NOT HAVE SIGNIFICANT EXPOSURE TO SPECIALTY SEMICONDUCTOR
STOCKS, WHICH WERE AMONG THE BEST TECHNOLOGY PERFORMERS FOR THE YEAR. AS A
RESULT, IT UNDERPERFORMED ITS BENCHMARK AND PEER GROUP.
o THE FUND HAS A NEW MANAGEMENT TEAM, WHICH HAS TAKEN STEPS TO REDUCE
VOLATILITY AND IMPROVE PERFORMANCE.
[Illustration of an arrow pointing down and two arrows pointing up]
RUSSELL 2000
CLASS Z GROWTH RUSSELL 2000
SHARES INDEX INDEX
-1.39% 3.38% 11.35%
OBJECTIVE
Seeks capital appreciation by
investing in stocks of companies
with a market capitalization,
at the time of initial purchase,
equal to or less than the
largest stock in the
S&P SmallCap 600 Index.
TOTAL NET ASSETS
$ 543.0 million
NET ASSET VALUE PER SHARE
AS OF 08/31/04 ($)
Class Z 21.32
PORTFOLIO MANAGERS' REPORT _____________________________________________________
COLUMBIA SMALL CAP GROWTH FUND
For the 12-month period ended August 31, 2004, Columbia Small Cap Growth Fund
class Z shares returned negative 1.39% without sales charge. That was less than
the return of the benchmark Russell 2000 Growth Index, which was 3.38%, and the
Russell 2000 Index, which was 11.35%, during the same period. The fund also
trailed its peer group, the Lipper Small-Cap Growth Funds Category average,
which was 0.71%. 1
The fund benefited from strong stock selection in the health care, energy and
materials sectors. However, technology held back performance because the fund
lacked significant exposure to specialty semiconductor stocks, which were among
the best technology performers during the year. With a new management team in
place, we have taken steps aimed at reducing volatility and improving
performance going forward.
SMALL CAPS HURT AS INVESTOR FOCUS SHIFTS TO LARGER COMPANIES
Fueled by a strengthening US economy, the stock market moved higher during the
first six months of this reporting period. In this environment, investors
favored small and highly leveraged, speculative companies that have the most to
gain in an improving economy. Because the fund focuses on small-cap stocks, it
was the beneficiary of this trend early in the reporting period. However,
sentiment changed dramatically as investors reacted to a sluggish employment
picture, the threat of higher interest rates and concerns about national
security. The market's focus shifted from small companies to larger, more stable
companies, and that shift hurt small-cap stocks as the year wore on.
The fund's substantial exposure to technology held back performance during the
period because of our emphasis on the technology services and software industry.
Within technology, the fund was underrepresented in specialty semiconductor
stocks, which were the best performers for the benchmark.
ENERGY, MATERIALS AND HEALTH CARE STOCKS HELPED FUND DELIVER SOLID RETURNS
The fund delivered a solid return for the year on the strength of many of its
energy, materials and health care holdings. In energy, rising oil prices boosted
oil service stocks XTO Energy and National-Oilwell. The energy sector also
benefited from the fact that companies have begun exploring for new energy
sources after several years of underinvestment. In health care, the fund's
investments in DaVita, a dialysis services company, and Renal Care Group, a
medical equipment and supply company, helped performance. In the materials
sector, OM Group, a specialty chemical company, and Steel Dynamics, a steel
production company, also made positive contributions to performance.
1 Lipper Inc., a widely respected data provider in the industry, calculates an
average total return for mutual funds with similar investment objectives as
those of the fund.
20
[Sidebar]
TOP 5 SECTORS AS OF 08/31/04 (%)
Information technology 31.9
------------------------------------------
Health care 18.1
------------------------------------------
Industrials 16.8
------------------------------------------
Consumer discretionary 14.0
------------------------------------------
Energy 8.1
TOP 10 HOLDINGS AS OF 08/31/04 (%)
Amphenol 2.5
------------------------------------------
Renal Care Group 2.0
------------------------------------------
United Defense Industries 2.0
------------------------------------------
Polycom 1.7
------------------------------------------
Autoliv 1.6
------------------------------------------
DaVita 1.6
------------------------------------------
Corporate Executive Board 1.5
------------------------------------------
ArthroCare 1.5
------------------------------------------
Silicon Laboratories 1.5
------------------------------------------
Manhattan Associates 1.5
HOLDINGS DISCUSSED IN THIS REPORT
AS OF 08/31/04 (%)
XTO Energy 1.5
------------------------------------------
National-Oilwell 1.4
------------------------------------------
DaVita 1.6
------------------------------------------
Renal Care Group 2.0
------------------------------------------
OM Group 1.1
------------------------------------------
Steel Dynamics 0.9
Your fund is actively managed and the composition of its portfolio will change
over time. Information provided is calculated as a percentage of net assets.
________________________________________________________________________________
COLUMBIA SMALL CAP GROWTH FUND
MORE DISCIPLINED INVESTMENT APPROACH IN PLACE
Although US stock markets have traded lower during the past few months, we see
reasons for optimism--and attractive investment opportunities--ahead. In light
of our expectation for modest but stable growth over the near term, we believe
that stock prices have become more attractive.
As part of a major restructuring of the fund, we have also taken steps to limit
the fund's exposure to any one industry in order to help manage risk. And, we
have introduced a systematic process that places more emphasis on valuations
relative to earnings growth in selecting individual stocks for the portfolio.
With a new management team and a new, more disciplined investment approach in
place, we believe that the fund is positioned for potentially better performance
going forward.
Kenneth A. Korngiebel has co-managed the fund since
June 2004 and has been with the advisor and its
predecessors since 1996.
/s/ Kenneth A. Korngiebel
Trent E. Nevills has co-managed the fund since June
2004 and has been with the advisor and its
predecessors since 2003.
/s/ Trent E. Nevills
An investment in the fund offers the potential for long-term growth, but also
involves certain risks, including stock market fluctuations due to economic and
business developments. Investing in small-cap stocks may present special risks,
including possible illiquidity and greater price volatility than stocks of
larger, more established companies.
21
[Sidebar]
PERFORMANCE OF A $ 10,000 INVESTMENT
09/01/94 - 08/31/04 ($)
SALES CHARGE WITHOUT WITH
------------------------------------------
Class A 36,671 34,573
------------------------------------------
Class B 36,209 36,209
------------------------------------------
Class C 36,193 36,193
------------------------------------------
Class D 36,220 35,862
------------------------------------------
Class Z 36,929 n/a
Performance data quoted represents past performance and current performance may
be lower or higher. Past performance is no guarantee of future results. The
investment return and principal value will fluctuate so that shares, when
redeemed, may be worth more or less than the original cost. Please visit
www.columbiafunds.com for daily and most recent month-end performance updates.
PERFORMANCE INFORMATION ________________________________________________________
COLUMBIA REAL ESTATE EQUITY FUND
VALUE OF A $10,000 INVESTMENT 09/01/94 - 08/31/04
[MOUNTAIN CHART]
CLASS A CLASS A
SHARES WITHOUT SHARES WITH NAREIT
SALES CHARGE SALES CHARGE INDEX
-------------- ------------ --------
09/1994 10000.00 9425.00 10000.00
9793.00 9230.00 9814.00
9498.00 8952.00 9473.00
9145.00 8619.00 9148.00
10058.00 9480.00 9815.00
9689.00 9132.00 9601.00
9783.00 9221.00 9839.00
9852.00 9285.00 9799.00
9704.00 9146.00 9796.00
10183.00 9598.00 10213.00
10439.00 9839.00 10375.00
10599.00 9989.00 10553.00
10670.00 10056.00 10680.00
10936.00 10308.00 10863.00
10694.00 10079.00 10630.00
10784.00 10163.00 10727.00
11755.00 11079.00 11313.00
11977.00 11289.00 11499.00
12079.00 11385.00 11634.00
12005.00 11315.00 11570.00
11996.00 11306.00 11629.00
12268.00 11563.00 11929.00
12559.00 11837.00 12084.00
12578.00 11854.00 12175.00
13186.00 12428.00 12654.00
13739.00 12949.00 12874.00
14008.00 13203.00 13257.00
14730.00 13883.00 13861.00
16257.00 15322.00 15302.00
16579.00 15626.00 15473.00
16680.00 15721.00 15442.00
16909.00 15936.00 15410.00
16330.00 15391.00 14986.00
16848.00 15879.00 15426.00
17611.00 16599.00 16176.00
18534.00 17468.00 16676.00
18349.00 17294.00 16636.00
19989.00 18840.00 18088.00
19306.00 18195.00 17600.00
19792.00 18654.00 17980.00
20279.00 19113.00 18404.00
20204.00 19042.00 18307.00
19826.00 18686.00 17996.00
20494.00 19316.00 18318.00
19605.00 18477.00 17720.00
19452.00 18333.00 17596.00
19397.00 18282.00 17477.00
18255.00 17205.00 16343.00
16915.00 15942.00 14800.00
17793.00 16770.00 15637.00
17492.00 16486.00 15348.00
17847.00 16821.00 15574.00
17774.00 16752.00 15181.00
17458.00 16454.00 14864.00
17334.00 16337.00 14515.00
17231.00 16241.00 14449.00
18657.00 17584.00 15821.00
19216.00 18111.00 16169.00
18782.00 17702.00 15907.00
18089.00 17049.00 15401.00
18078.00 17039.00 15205.00
17270.00 16277.00 14628.00
16919.00 15946.00 14268.00
16779.00 15814.00 14035.00
17336.00 16339.00 14480.00
17407.00 16406.00 14528.00
16979.00 16003.00 14355.00
17860.00 16833.00 14827.00
18932.00 17843.00 15824.00
19089.00 17991.00 15979.00
19799.00 18660.00 16389.00
21504.00 20267.00 17822.00
20652.00 19465.00 17098.00
21505.00 20268.00 17642.00
20481.00 19304.00 16878.00
21086.00 19873.00 17094.00
22338.00 21054.00 18298.00
22126.00 20854.00 18488.00
21814.00 20560.00 18192.00
21439.00 20206.00 18368.00
22195.00 20919.00 18808.00
22675.00 21371.00 19263.00
23659.00 22299.00 20391.00
23240.00 21904.00 19986.00
23977.00 22598.00 20717.00
22464.00 21172.00 19857.00
21702.00 20455.00 19289.00
22952.00 21633.00 20350.00
23545.00 22191.00 20847.00
23688.00 22326.00 20889.00
24157.00 22768.00 21292.00
25070.00 23629.00 22569.00
25253.00 23801.00 22761.00
25753.00 24273.00 23068.00
26122.00 24620.00 23698.00
24769.00 23344.00 22459.00
24516.00 23106.00 22414.00
23548.00 22194.00 21553.00
22848.00 21534.00 20516.00
24016.00 22635.00 21483.00
24242.00 22848.00 21642.00
23587.00 22231.00 21012.00
23858.00 22486.00 21359.00
24271.00 22875.00 21786.00
25283.00 23829.00 22744.00
26514.00 24990.00 24118.00
27095.00 25537.00 24644.00
28431.00 26796.00 25962.00
28997.00 27329.00 26103.00
29748.00 28037.00 26990.00
30179.00 28444.00 27479.00
31446.00 29638.00 28677.00
32708.00 30827.00 29680.00
33738.00 31798.00 30963.00
34585.00 32596.00 31504.00
36151.00 34073.00 33247.00
31647.00 29827.00 28399.00
33536.00 31608.00 30424.00
34693.00 32698.00 31315.00
34551.00 32564.00 31419.00
08/2004 36671.00 34573.00 33919.00
The graph and table do not reflect the deduction of taxes that a shareholder
would pay on fund distributions or redemption of fund shares. The National
Association of Real Estate Investment Trusts (NAREIT) Index is an unmanaged
index that tracks performance of all publicly traded equity REIT. Unlike mutual
funds, indices are not investments, do not incur fees or expenses and are not
professionally managed. It is not possible to invest directly in an index.
Securities in the fund may not match those in an index.
AVERAGE ANNUAL TOTAL RETURN AS OF 08/31/04 (%)
SHARE CLASS A B C D Z
- ---------------------------------------------------------------------------------------------------
INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 04/01/94
- ---------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- ---------------------------------------------------------------------------------------------------
1-year 26.42 19.15 25.53 20.53 25.47 24.47 25.55 23.32 26.72
- ---------------------------------------------------------------------------------------------------
5-year 15.19 13.83 14.90 14.67 14.89 14.89 14.90 14.67 15.35
- ---------------------------------------------------------------------------------------------------
10-year 13.88 13.21 13.73 13.73 13.73 13.73 13.74 13.62 13.96
AVERAGE ANNUAL TOTAL RETURN AS OF 06/30/04 (%)
SHARE CLASS A B C D Z
- ---------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- ---------------------------------------------------------------------------------------------------
1-year 28.05 20.69 27.12 22.12 27.05 26.05 27.14 24.87 28.36
- ---------------------------------------------------------------------------------------------------
5-year 13.06 11.73 12.80 12.56 12.79 12.79 12.81 12.59 13.21
- ---------------------------------------------------------------------------------------------------
10-year 13.23 12.56 13.10 13.10 13.10 13.10 13.11 12.99 13.31
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF
5.75% FOR CLASS A SHARES AND 1% FOR CLASS D SHARES, MAXIMUM CONTINGENT DEFERRED
SALES CHARGE OF 5.00% FOR CLASS B SHARES AND 1.00% FOR CLASS C AND D SHARES FOR
THE FIRST YEAR ONLY.
ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS, IF ANY. CLASS Z SHARES
ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT
SHARE CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES
ASSOCIATED WITH EACH CLASS.
Effective October 13, 2003, class D shares were closed to all new investors and
new accounts. Existing class D shareholders will be able to make additional
purchases at any time. In addition, class D initial sales charge of 1.00% is
waived after October 13, 2003.
Performance results reflect any voluntary waivers or reimbursement of fund
expenses by the advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
Classes A, B, and D (newer class shares) share performance information includes
returns of the fund's class Z shares (the oldest existing fund class) for
periods prior to the inception of the newer class shares. The returns for class
C include the returns of class B prior to 10/13/03, the date on which class C
was initially offered by the fund. The returns shown for class C also include
the performance of class Z prior to the inception of class B (11/01/02). Class Z
share returns are not restated to reflect any expense differential (e.g., Rule
12b-1 fees) between class Z shares and the newer class shares. Had the expense
differential been reflected, the returns for the periods prior to the inception
of classes A, B, C and D would have been lower.
22
[Sidebar]
ESTIMATING YOUR ACTUAL EXPENSES
To estimate the expenses that you paid over the period, first you will need your
account balance at the end of the period:
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS
SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT
WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE
FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE
1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT
BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6
2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD,"
LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE
COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1.
YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING
THE PERIOD
UNDERSTANDING YOUR EXPENSES ____________________________________________________
COLUMBIA REAL ESTATE EQUITY FUND
As a fund shareholder, you incur two types of costs. There are transaction
costs, which generally include sales charges on purchases and may include
redemption or exchange fees. There are also ongoing costs, which generally
include investment advisory fees, and/or Rule 12b-1 fees, and other fund
expenses. The information on this page is intended to help you understand your
ongoing costs of investing in the fund and to compare these costs with the
ongoing costs of investing in other mutual funds.
ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS
To illustrate these ongoing costs, we have provided an example and calculated
the expenses paid by investors in each share class during the reporting period.
The information in the following table is based on an initial investment of
$1,000, which is invested at the beginning of the reporting period and held for
the entire period. Expense information is calculated two ways and each method
provides you with different information. The amount listed in the "actual"
column is calculated using the fund's actual operating expenses and total return
for the period. The amount listed in the "hypothetical" column for each share
class assumes that the return each year is 5% before expenses and includes the
fund's actual expense ratio. You should not use the hypothetical account values
and expenses to estimate either your actual account balance at the end of the
period or the expenses you paid during this reporting period.
MARCH 1, 2004 - AUGUST 31, 2004
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED
BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%)
- ---------------------------------------------------------------------------------------------------------
ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL
- ---------------------------------------------------------------------------------------------------------
Class A 1,000.00 1,000.00 1,064.10 1,019.05 6.28 6.14 1.21
- ---------------------------------------------------------------------------------------------------------
Class B 1,000.00 1,000.00 1,060.83 1,015.28 10.15 9.93 1.96
- ---------------------------------------------------------------------------------------------------------
Class C 1,000.00 1,000.00 1,060.03 1,015.28 10.15 9.93 1.96
- ---------------------------------------------------------------------------------------------------------
Class D 1,000.00 1,000.00 1,059.98 1,015.28 10.15 9.93 1.96
- ---------------------------------------------------------------------------------------------------------
Class Z 1,000.00 1,000.00 1,063.55 1,020.31 4.98 4.88 0.96
Expenses paid during the period are equal to the fund's annualized expense
ratio, multiplied by the average account value over the period, then multiplied
by the number of days in the fund's most recent fiscal half-year and divided by
366.
It is important to note that the expense amounts shown in the table are meant to
highlight only ongoing costs of investing in the fund and do not reflect any
transactional costs, such as sales charges, redemption or exchange fees.
Therefore, the hypothetical examples provided may not help you determine the
relative total costs of owning different funds. If these transactional costs
were included, your costs would have been higher.
COMPARE WITH OTHER FUNDS
Since all mutual fund companies are required to include the same hypothetical
calculations about expenses in shareholder reports, you can use this information
to compare the ongoing cost of investing in the fund with other funds. To do so,
compare the 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of other funds. As you compare hypothetical
examples of other funds, it is important to note that hypothetical examples are
meant to highlight the continuing cost of investing in a fund and do not reflect
any transactional costs, such as sales charges or redemption or exchange fees.
23
[Sidebar]
SUMMARY
o FOR THE 12-MONTH PERIOD ENDED AUGUST 31, 2004, THE FUND'S CLASS A SHARES
RETURNED 26.42% WITHOUT SALES CHARGE.
o A STRONG REIT MARKET CONTRIBUTED TO DOUBLE-DIGIT RETURNS FOR THE FUND, ITS
BENCHMARK AND THE LIPPER REAL ESTATE FUNDS CATEGORY.
o THE FUND TRAILED ITS BENCHMARK AND PEER GROUP BECAUSE IT CONTINUED TO HOLD
SIZEABLE INVESTMENTS IN PAPER AND FOREST PRODUCTS COMPANIES AS A DEFENSIVE
STRATEGY.
[Illustration of two arrows pointing up]
CLASS A SHARES NAREIT INDEX
26.42% 29.91%
OBJECTIVE
Seeks capital appreciation
and above-average income by
investing in stocks of companies
principally engaged in the real
estate industry, including real
estate investment trusts (REITs).
TOTAL NET ASSETS
$ 923.3 million
NET ASSET VALUE PER SHARE
AS OF 08/31/04 ($)
Class A 25.59
------------------------------------------
Class B 25.60
------------------------------------------
Class C 25.58
------------------------------------------
Class D 25.59
------------------------------------------
Class Z 25.60
DISTRIBUTIONS DECLARED PER SHARE
09/01/03 - 08/31/04 ($)
Class A 0.89
------------------------------------------
Class B 0.71
------------------------------------------
Class C 0.54
------------------------------------------
Class D 0.72
------------------------------------------
Class Z 0.96
PORTFOLIO MANAGER'S REPORT _____________________________________________________
COLUMBIA REAL ESTATE EQUITY FUND
For the 12-month period ended August 31, 2004, Columbia Real Estate Equity Fund
class A shares returned 26.42% without sales charge. The fund trailed the
benchmark NAREIT Index, a common measure of real estate securities' performance,
which returned 29.91%. The fund also underperformed the average of the Lipper
Real Estate Funds Category, which was 28.90%. 1 We believe the fund's defensive
posture, represented by its overweight allocation to the paper and forest
product sector, accounted for the gap in performance relative to the index and
its peers.
MIXED ECONOMIC SIGNALS, A SLUGGISH STOCK MARKET AID REIT RETURNS
During the period, REITs benefited as the economy sent mixed signals to
investors and investors sought higher yields. The REIT market corrected sharply
in April and May 2004 in reaction to positive employment news that all but
assured that the Federal Reserve Board would raise short-term interest rates.
However, it rallied to new highs during the summer months as economic indicators
weakened.
The rebound favored the fund's REIT investments, but it hurt the fund's
positions in non-real-estate related companies--primarily the paper & forest
products and containers & packaging sectors, which represented 12% of the
portfolio as of 08/31/04. (The fund's investment policy permits it to hold up to
20% of assets in non-real-estate related companies.) We added to holdings in
this sector, which worked out well when the REIT market corrected in the spring.
But the correction was short-lived, and the substantial defensive position had a
negative impact on the fund's 12-month return.
EMPHASIS ON BUSINESS PROSPECTS AIDED PERFORMANCE
During the 12-month reporting period, the fund increased its holdings in lodging
stocks such as Host Marriott and selected non-REIT real estate companies,
resulting in a significant overweight compared to the index--14% versus 5%.
Lodging securities were strong performers as the sector's prospects steadily
improved on increased business travel. We believe issues in this sector remain
inexpensive relative to the index.
Other sectors of the real estate markets with links to economic prosperity,
including shopping malls and industrial REITs, also performed well over the
period. The fund benefited from its sizeable holdings in both. However we
reduced our exposure to shopping malls and industrial REITs during the period
because we believe they have become expensive relative to their earnings
prospects. Retail remains the fastest growing sector of the REIT market, but we
believe cash flow growth rates for these companies have peaked.
1 Lipper Inc., a widely respected data provider in the industry, calculates an
average total return for mutual funds with similar investment objectives as
those of the fund.
24
[Sidebar]
TOP 5 SECTORS AS OF 08/31/04 (%)
Industrial 23.2
------------------------------------------
Retail 18.8
------------------------------------------
Other 18.2
------------------------------------------
Lodging 15.7
------------------------------------------
Office 13.2
TOP 10 HOLDINGS AS OF 08/31/04 (%)
iStar Financial 4.9
------------------------------------------
Simon Property Group 4.8
------------------------------------------
Cousins Properties 4.7
------------------------------------------
Hilton Hotels 4.5
------------------------------------------
Equity Residential 4.4
------------------------------------------
Alexandria Real Estate Equities 4.0
------------------------------------------
Prologis 3.8
------------------------------------------
General Growth Properties 3.8
------------------------------------------
Host Marriott 3.6
------------------------------------------
Bowater 3.3
HOLDINGS DISCUSSED IN THIS REPORT
AS OF 08/31/04 (%)
Host Marriott 3.6
Your fund is actively managed and the composition of its portfolio will change
over time. Information provided is calculated as a percentage of net assets.
________________________________________________________________________________
COLUMBIA REAL ESTATE EQUITY FUND
We continued to maintain an underweight position in office and residential
REITs because of poor business prospects in both sectors. Office vacancy rates
remained high. Also, large unused blocks of space, which were leased prior to
the 2001 recession, put a crimp on demand. We raised our exposure to
residential REITs somewhat as demand for apartments improved. However, an
oversupply of units--the result of overbuilding--has kept us cautious about the
sector.
REITs REMAIN EXPENSIVE
REIT valuations remain high, both as compared to
other securities and relative to the value of underlying real estate assets.
The sector also faces the additional challenges of slow property cash flow
growth and higher relative dividend tax rates. As a result of these factors, we
believe that REIT stocks are due for a period of underperformance, particularly
as the economy picks up steam. Therefore, we plan to continue to position the
fund away from REIT stocks and toward other real-estate related issues,
particularly in sectors linked to a recovering economy. We continue to monitor
the sectors of the REIT market for positive and negative changes in light of
the changing economic environment. We believe that our investment portfolio can
benefit from the stronger economic conditions we expect going forward.
David Jellison has managed the fund since 1994 and
has been with the advisor and its predecessors since
1992.
/s/ David Jellison
An investment in the fund may present certain risks, including stock market
fluctuations that occur in response to economic and business developments. The
fund may be subject to the same types of risks associated with direct ownership
of real estate including the decline of property value due to general, local and
regional economic conditions. In addition, the fund's share price will likely be
subject to more volatility than the overall stock market because it concentrates
in real estate stocks.
25
[Sidebar]
PERFORMANCE OF A $10,000 INVESTMENT
11/09/00 - 08/31/04 ($)
SALES CHARGE WITHOUT WITH
------------------------------------------
Class A 6,494 6,121
------------------------------------------
Class B 6,394 6,202
------------------------------------------
Class C 6,404 6,404
------------------------------------------
Class D 6,424 6,360
------------------------------------------
Class Z 6,544 n/a
Performance data quoted represents past performance and current performance may
be lower or higher. Past performance is no guarantee of future results. The
investment return and principal value will fluctuate so that shares, when
redeemed, may be worth more or less than the original cost. Please visit
www.columbiafunds.com for daily and most recent month-end performance updates.
PERFORMANCE INFORMATION ________________________________________________________
COLUMBIA TECHNOLOGY FUND
VALUE OF A $10,000 INVESTMENT 11/09/00 - 08/31/04
[MOUNTAIN CHART]
CLASS A CLASS A MERRILL LYNCH
SHARES WITHOUT SHARES WITH 100 TECHNOLOGY
SALES CHARGE SALES CHARGE INDEX
-------------- ------------ ---------------
11/2000 10000.00 9425.00 10000.00
8713.00 8212.00 7744.00
8622.00 8127.00 7317.00
9142.00 8617.00 8577.00
6815.00 6423.00 6096.00
6145.00 5792.00 5123.00
7365.00 6941.00 6259.00
7135.00 6725.00 5891.00
7285.00 6866.00 5912.00
6745.00 6357.00 5377.00
6095.00 5745.00 4719.00
4547.00 4285.00 3495.00
5166.00 4869.00 4158.00
5896.00 5557.00 4944.00
6126.00 5773.00 4935.00
6086.00 5736.00 4962.00
5367.00 5058.00 4289.00
6106.00 5755.00 4788.00
5376.00 5067.00 4204.00
5047.00 4757.00 3969.00
4607.00 4342.00 3321.00
3888.00 3664.00 2877.00
3858.00 3636.00 2776.00
3468.00 3269.00 2277.00
3818.00 3598.00 2774.00
4258.00 4013.00 3386.00
3788.00 3570.00 2885.00
3828.00 3608.00 2876.00
3808.00 3589.00 2901.00
3679.00 3467.00 2880.00
4138.00 3900.00 3218.00
4888.00 4607.00 3764.00
4988.00 4701.00 3746.00
5398.00 5088.00 3916.00
5907.00 5568.00 4353.00
5977.00 5634.00 4204.00
6727.00 6340.00 4711.00
7066.00 6660.00 4862.00
6977.00 6576.00 4871.00
7496.00 7065.00 5182.00
7356.00 6933.00 5085.00
7286.00 6867.00 4941.00
6916.00 6519.00 4545.00
7226.00 6811.00 4811.00
7566.00 7131.00 4955.00
6687.00 6302.00 4389.00
08/2004 6494.00 6121.00 4192.00
The graph and table do not reflect a deduction of the taxes that a shareholder
would pay on fund distributions or the redemption of fund shares. The Merrill
Lynch 100 Technology Index is an equally weighted, unmanaged index of 100
leading technology stocks. Unlike mutual funds, indices are not investments, do
not incur fees or expenses and are not professionally managed. It is not
possible to invest directly in an index. Securities in the fund may not match
those in an index. Index performance is from November 9, 2000.
AVERAGE ANNUAL TOTAL RETURN AS OF 08/31/04 (%)
SHARE CLASS A B C D Z
- --------------------------------------------------------------------------------------------------------------------
INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 11/09/00
- --------------------------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- --------------------------------------------------------------------------------------------------------------------
1-year 9.98 3.66 9.22 4.22 9.39 8.39 9.35 7.27 10.46
- --------------------------------------------------------------------------------------------------------------------
Life -10.72 -12.09 -11.08 -11.79 -11.04 -11.04 -10.97 -11.20 -10.54
AVERAGE ANNUAL TOTAL RETURN AS OF 06/30/04 (%)
SHARE CLASS A B C D Z
- --------------------------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- --------------------------------------------------------------------------------------------------------------------
1-year 51.70 42.98 50.71 45.71 50.91 49.91 50.60 48.11 52.10
- --------------------------------------------------------------------------------------------------------------------
Life -7.39 -8.88 -7.76 -8.53 -7.73 -7.73 -7.63 -7.88 -7.22
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF
5.75% FOR CLASS A SHARES AND 1% FOR CLASS D SHARES, MAXIMUM CONTINGENT DEFERRED
SALES CHARGE OF 5.00% FOR CLASS B SHARES AND 1.00% FOR CLASS C AND D SHARES FOR
THE FIRST YEAR ONLY.
ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS, IF ANY. CLASS Z SHARES
ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT
SHARE CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES
ASSOCIATED WITH EACH CLASS.
Effective October 13, 2003, class D shares were closed to all new investors and
new accounts. Existing class D shareholders will be able to make additional
purchases at any time. In addition, class D initial sales charge of 1.00% is
waived after October 13, 2003.
Performance results reflect any voluntary waivers or reimbursement of fund
expenses by the advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
Classes A, B, and D (newer class shares) share performance information includes
returns of the fund's class Z shares (the oldest existing fund class) for
periods prior to the inception of the newer class shares. The returns for class
C include the returns of class B prior to 10/13/03, the date on which class C
was initially offered by the fund. The returns shown for class C also include
the performance of class Z prior to the inception of class B (11/01/02). Class Z
share returns are not restated to reflect any expense differential (e.g., Rule
12b-1 fees) between class Z shares and the newer class shares. Had the expense
differential been reflected, the returns for the periods prior to the inception
of classes A, B, C and D would have been lower.
26
[Sidebar]
ESTIMATING YOUR ACTUAL EXPENSES
To estimate the expenses that you paid over the period, first you will need your
account balance at the end of the period:
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS
SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT
WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE
FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE
1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT
BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6
2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD,"
LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE
COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1.
YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING
THE PERIOD
UNDERSTANDING YOUR EXPENSES ____________________________________________________
COLUMBIA TECHNOLOGY FUND
As a fund shareholder, you incur two types of costs. There are transaction
costs, which generally include sales charges on purchases and may include
redemption or exchange fees. There are also ongoing costs, which generally
include investment advisory fees, and/or Rule 12b-1 fees, and other fund
expenses. The information on this page is intended to help you understand your
ongoing costs of investing in the fund and to compare these costs with the
ongoing costs of investing in other mutual funds.
ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS
To illustrate these ongoing costs, we have provided an example and calculated
the expenses paid by investors in each share class during the reporting period.
The information in the following table is based on an initial investment of
$1,000, which is invested at the beginning of the reporting period and held for
the entire period. Expense information is calculated two ways and each method
provides you with different information. The amount listed in the "actual"
column is calculated using the fund's actual operating expenses and total return
for the period. The amount listed in the "hypothetical" column for each share
class assumes that the return each year is 5% before expenses and includes the
fund's actual expense ratio. You should not use the hypothetical account values
and expenses to estimate either your actual account balance at the end of the
period or the expenses you paid during this reporting period.
MARCH 1, 2004 - AUGUST 31, 2004
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED
BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%)
- ---------------------------------------------------------------------------------------------------------
ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL
- ---------------------------------------------------------------------------------------------------------
Class A 1,000.00 1,000.00 888.14 1,015.58 9.02 9.63 1.90
- ---------------------------------------------------------------------------------------------------------
Class B 1,000.00 1,000.00 883.72 1,011.81 12.55 13.40 2.65
- ---------------------------------------------------------------------------------------------------------
Class C 1,000.00 1,000.00 884.92 1,011.81 12.56 13.40 2.65
- ---------------------------------------------------------------------------------------------------------
Class D 1,000.00 1,000.00 884.17 1,011.81 12.55 13.40 2.65
- ---------------------------------------------------------------------------------------------------------
Class Z 1,000.00 1,000.00 890.15 1,016.84 7.84 8.36 1.65
Expenses paid during the period are equal to the fund's annualized expense
ratio, multiplied by the average account value over the period, then multiplied
by the number of days in the fund's most recent fiscal half-year and divided by
366.
Had the Investment Advisor not reimbursed a portion of expenses, total return
would have been reduced.
It is important to note that the expense amounts shown in the table are meant to
highlight only ongoing costs of investing in the fund and do not reflect any
transactional costs, such as sales charges, redemption or exchange fees.
Therefore, the hypothetical examples provided may not help you determine the
relative total costs of owning different funds. If these transactional costs
were included, your costs would have been higher.
COMPARE WITH OTHER FUNDS
Since all mutual fund companies are required to include the same hypothetical
calculations about expenses in shareholder reports, you can use this information
to compare the ongoing cost of investing in the fund with other funds. To do so,
compare the 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of other funds. As you compare hypothetical
examples of other funds, it is important to note that hypothetical examples are
meant to highlight the continuing cost of investing in a fund and do not reflect
any transactional costs, such as sales charges or redemption or exchange fees.
27
[Sidebar]
SUMMARY
o FOR THE 12-MONTH PERIOD ENDED AUGUST 31, 2004, THE FUND'S CLASS A SHARES
RETURNED 9.98% WITHOUT SALES CHARGE.
o THE FUND OUTPERFORMED BOTH THE MERRILL LYNCH 100 TECHNOLOGY INDEX AND THE
LIPPER SCIENCE & TECHNOLOGY FUNDS CATEGORY AVERAGE, WHICH BOTH GENERATED
NEGATIVE RETURNS FOR THE PERIOD.
o THE MANAGEMENT TEAM'S DECISION TO EMPHASIZE CONSUMER-ORIENTED TECHNOLOGY
COMPANIES IN THE SEMICONDUCTOR, WIRELESS COMMUNICATIONS AND INTERNET SECTORS
ACCOUNTED FOR ITS STRONG PERFORMANCE.
[Illustration of an arrow pointing up and one arrow pointing down]
MERRILL LYNCH 100
CLASS A SHARES TECHNOLOGY INDEX
9.98% -3.73%
OBJECTIVE
Seeks capital appreciation by
investing in stocks of technology
companies that may benefit
from technological
improvements, advancements
or developments.
TOTAL NET ASSETS
$ 35.8 MILLION
NET ASSET VALUE PER SHARE
AS OF 08/31/04 ($)
Class A 6.50
------------------------------------------
Class B 6.40
------------------------------------------
Class C 6.41
------------------------------------------
Class D 6.43
------------------------------------------
Class Z 6.55
PORTFOLIO MANAGERS' REPORT _____________________________________________________
COLUMBIA TECHNOLOGY FUND
For the 12-month period ended August 31, 2004, Columbia Technology Fund class A
shares returned 9.98% without sales charge. The fund outpaced the Merrill Lynch
100 Technology Index, which returned negative 3.73% for the same period. It also
significantly outperformed the Lipper Science & Technology Category average of
negative 6.20%. 1 The fund's emphasis on consumer-oriented semiconductor,
wireless and Internet companies, combined with strong stock selection, helped
its competitive performance.
FUND HELD ITS GROUND IN A CHANGING MARKET
During the first half of the 12-month period, the fund's aggressive positioning
helped it generate robust returns in a rising stock market. But the broad-based
economic growth that characterized the first six months hit a rough patch in the
second half. Decelerating economic growth, the expectation of rising interest
rates and sharply increased commodity prices slowed the stock market in 2004.
Technology stock prices fell, in many cases erasing earlier gains. By contrast,
the fund's strong sector and stock selection throughout the year helped it
sustain its gains through the end of the period.
EMPHASIS ON CONSUMER-RELATED HOLDINGS HELPED PERFORMANCE
The fund's emphasis on consumer discretionary stocks proved to be an effective
strategy when corporate spending did not accelerate as much as the markets had
anticipated. XM Satellite Radio Holdings and eBay, the highly successful online
auction company, were two of the fund's best performers. We held a substantial
position in eBay, which represented 7.8% of net assets at the end of the period,
a much higher weighting than its representation in the benchmark. We also had
good returns from cell phone and television manufacturer Samsung Electronics.
STRONG RETURNS FROM SEMICONDUCTORS
Strong stock selection in semiconductors also helped fund performance. We were
able to ride the computer graphics cycle with NVIDIA, buying the stock at a
relatively attractive price prior to new product introductions, then taking
profits after the product introductions. As new product sales slowed and the
stock price declined, we added to our position again before a new product cycle
resumed. We had a similar success with FormFactor, which sells testers of DDR
equipment used for D-RAM computer memory upgrades in desktop computers. The
company benefited as industry adoption of new DDR2 memory chips drove demand for
its testers.
DISAPPOINTING RETURNS FROM INTERNET SOFTWARE SERVICES
The fund's weakest performers were Internet software services companies. This
sector had done well in the past and we started the year with fairly large
exposure to it. However, we trimmed our positions as
1 Lipper Inc., a widely respected data provider in the industry, calculates an
average total return for mutual funds with similar investment objectives as
those of the fund.
28
[Sidebar]
TOP 5 SECTORS AS OF 08/31/04 (%)
Semiconductors & semiconductor
equipment 18.6
------------------------------------------
Communications equipment 15.7
------------------------------------------
Software 11.8
------------------------------------------
Internet & catalog retail 10.7
------------------------------------------
Wireless telecommunication
services 9.9
TOP 10 HOLDINGS AS OF 08/31/04 (%)
Nokia Oyj 7.9
------------------------------------------
eBay 7.8
------------------------------------------
PalmOne 4.4
------------------------------------------
XM Satellite Radio Holdings 3.8
------------------------------------------
Silicon Laboratories 3.3
------------------------------------------
Samsung Electronics 2.9
------------------------------------------
Broadcom 2.8
------------------------------------------
Millicom International Cellular 2.5
------------------------------------------
Marvell Technology Group 2.5
------------------------------------------
Amazon.com 2.3
HOLDINGS DISCUSSED IN THIS REPORT
AS OF 08/31/04 (%)
XM Satellite Radio Holdings 3.8
------------------------------------------
eBay 7.8
------------------------------------------
Samsung Electronics 2.9
------------------------------------------
NVIDIA 0.8
------------------------------------------
FormFactor 0.5
------------------------------------------
Millicom International Cellular 2.5
------------------------------------------
VimpelCom 2.0
Your fund is actively managed and the composition of its portfolio will change
over time. Information provided is calculated as a percentage of net assets.
________________________________________________________________________________
COLUMBIA TECHNOLOGY FUND
the sector lost value. Free Internet provider United Online and the Internet DVD
rental company NetFlix both had disappointing performance and we sold our
positions during the year.
COMMUNICATIONS OPPORTUNITIES OVERSEAS
We maintained a relatively high exposure to international markets with
investments in Millicom International Cellular and VimpelCom, which posted
double-digit returns during the 12-month reporting period. Millicom provides
cellular service in developing countries in Africa, Asia and South America,
while VimpelCom is a leading cell phone carrier in Russia. We believe
international cell phone service companies offer greater upside potential than
their US counterparts because of higher growth rates and lower competition in
the developing markets they serve.
UNCERTAIN TIMES AHEAD
The fund faired well in a 12-month period notable for its downward trend. While
the difficult market for tech stocks may not yet be over, the fall season is
usually the strongest season in the yearly technology cycle. Even so, incoming
economic data remains somewhat difficult to interpret and markets are likely to
remain volatile through the presidential election.
Wayne Collette has co-managed the Columbia Technology
Fund since June 2002 and has been with the advisor and
its predecessors since 2001.
/s/ Wayne Collette
Theodore Wendell joined the advisor and its
predecessors in 2000. Except for the period between
June and August 2004, he has co-managed the fund since
June 2002.
/s/ Theodore Wendell
Trent Nevills has co-managed the fund since August 2003
and has been with the advisor since 2003.
/s/ Trent Nevills
An investment in the fund may present certain risks, including stock market
fluctuations that occur in response to economic and business developments. In
addition, the fund's share price will likely be subject to more volatility than
the overall stock market because it concentrates in technology stocks.
29
[Sidebar]
PERFORMANCE OF A $10,000 INVESTMENT
11/09/00 - 08/31/04 ($)
SALES CHARGE WITHOUT WITH
------------------------------------------
Class A 18,694 17,621
------------------------------------------
Class B 18,416 18,116
------------------------------------------
Class C 18,426 18,426
------------------------------------------
Class D 18,416 18,234
------------------------------------------
Class Z 18,784 n/a
Performance data quoted represents past performance and current performance may
be lower or higher. Past performance is no guarantee of future results. The
investment return and principal value will fluctuate so that shares, when
redeemed, may be worth more or less than the original cost. Please visit
www.columbiafunds.com for daily and most recent month-end performance updates.
PERFORMANCE INFORMATION ________________________________________________________
COLUMBIA STRATEGIC INVESTOR FUND
VALUE OF A $10,000 INVESTMENT 11/09/00 - 08/31/04
[MOUNTIAN CHART]
CLASS A CLASS A
SHARES WITHOUT SHARES WITH RUSSELL 3000
SALES CHARGE SALES CHARGE VALUE INDEX S&P 500 INDEX
-------------- ------------ ------------- -------------
11/2000 10000.00 9425.00 10000.00 10000.00
9790.00 9227.00 9730.00 9399.00
11224.00 10579.00 10253.00 9445.00
12274.00 11568.00 10308.00 9780.00
12254.00 11549.00 10040.00 8888.00
11984.00 11295.00 9699.00 8325.00
12934.00 12190.00 10172.00 8972.00
13743.00 12953.00 10403.00 9032.00
13963.00 13160.00 10218.00 8812.00
13884.00 13085.00 10182.00 8726.00
13664.00 12879.00 9799.00 8180.00
12325.00 11616.00 9082.00 7519.00
12736.00 12003.00 9024.00 7662.00
13896.00 13097.00 9558.00 8250.00
14568.00 13731.00 9808.00 8323.00
14599.00 13759.00 9747.00 8201.00
14719.00 13872.00 9766.00 8043.00
15591.00 14695.00 10248.00 8345.00
15521.00 14629.00 9951.00 7840.00
15541.00 14648.00 9970.00 7782.00
14900.00 14043.00 9426.00 7228.00
13636.00 12852.00 8510.00 6665.00
13676.00 12889.00 8567.00 6708.00
12311.00 11603.00 7639.00 5979.00
12894.00 12153.00 8172.00 6505.00
14141.00 13328.00 8696.00 6888.00
13310.00 12544.00 8318.00 6484.00
12945.00 12201.00 8115.00 6314.00
12681.00 11952.00 7895.00 6219.00
12620.00 11894.00 7913.00 6279.00
13827.00 13032.00 8613.00 6797.00
14982.00 14121.00 9192.00 7155.00
15125.00 14255.00 9310.00 7247.00
15601.00 14704.00 9472.00 7374.00
16169.00 15239.00 9634.00 7518.00
16037.00 15114.00 9539.00 7438.00
16928.00 15955.00 10137.00 7859.00
17294.00 16299.00 10294.00 7928.00
18117.00 17075.00 10908.00 8344.00
18503.00 17439.00 11114.00 8497.00
18941.00 17852.00 11351.00 8615.00
19002.00 17909.00 11271.00 8485.00
18666.00 17592.00 10971.00 8352.00
18675.00 17601.00 11084.00 8467.00
19224.00 18119.00 11369.00 8631.00
18582.00 17514.00 11178.00 8345.00
08/2004 18694.00 17621.00 11336.00 8379.00
The graph and table do not reflect a deduction of the taxes that a shareholder
would pay on fund distributions or the redemption of fund shares. The Russell
3000 Value Index is an unmanaged index that measures the performance of those
Russell 3000 Index companies with lower price-to-book ratios and lower
forecasted growth values. The stocks in this index are also members of either
the Russell 1000 Value or the Russell 2000 Value Index. The Standard & Poor's
(S&P) 500 Index is an unmanaged index that tracks the performance of 500 widely
held, large-capitalization U.S. stocks. Unlike mutual funds, indices are not
investments, do not incur fees or expenses and are not professionally managed.
It is not possible to invest directly in an index. Securities in the fund may
not match those in an index. Index performance is from November 9, 2000.
AVERAGE ANNUAL TOTAL RETURN AS OF 08/31/04 (%)
SHARE CLASS A B C D Z
- --------------------------------------------------------------------------------------------------------------------
INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 11/09/00
- --------------------------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- --------------------------------------------------------------------------------------------------------------------
1-year 15.64 8.99 14.85 9.85 14.92 13.92 14.93 12.79 15.98
- --------------------------------------------------------------------------------------------------------------------
Life 17.85 16.04 17.39 16.89 17.41 17.41 17.39 17.09 18.00
- --------------------------------------------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN AS OF 06/30/04 (%)
SHARE CLASS A B C D Z
- --------------------------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- --------------------------------------------------------------------------------------------------------------------
1-year 27.12 19.81 26.25 21.25 26.32 25.32 26.27 24.01 27.49
- --------------------------------------------------------------------------------------------------------------------
Life 19.68 17.75 19.23 18.71 19.25 19.25 19.21 18.89 19.82
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF
5.75% FOR CLASS A SHARES AND 1% FOR CLASS D SHARES, MAXIMUM CONTINGENT DEFERRED
SALES CHARGE OF 5.00% FOR CLASS B SHARES AND 1.00% FOR CLASS C AND D SHARES FOR
THE FIRST YEAR ONLY.
ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS, IF ANY. CLASS Z SHARES
ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT
SHARE CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES
ASSOCIATED WITH EACH CLASS.
Effective October 13, 2003, class D shares were closed to all new investors and
new accounts. Existing class D shareholders will be able to make additional
purchases at any time. In addition, class D initial sales charge of 1.00% is
waived after October 13, 2003.
Performance results reflect any voluntary waivers or reimbursement of fund
expenses by the advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
Classes A, B, and D (newer class shares) share performance information includes
returns of the fund's class Z shares (the oldest existing fund class) for
periods prior to the inception of the newer class shares. The returns for class
C include the returns of class B prior to 10/13/03, the date on which class C
was initially offered by the fund. The returns shown for class C also include
the performance of class Z prior to the inception of class B (11/01/02). Class Z
share returns are not restated to reflect any expense differential (e.g., Rule
12b-1 fees) between class Z shares and the newer class shares. Had the expense
differential been reflected, the returns for the periods prior to the inception
of classes A, B, C, and D would have been lower.
30
[Sidebar]
ESTIMATING YOUR ACTUAL EXPENSES
To estimate the expenses that you paid over the period, first you will need your
account balance at the end of the period:
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS
SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT
WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE
FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE
1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT
BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6
2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD,"
LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE
COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1.
YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING
THE PERIOD
UNDERSTANDING YOUR EXPENSES ____________________________________________________
COLUMBIA STRATEGIC INVESTOR FUND
As a fund shareholder, you incur two types of costs. There are transaction
costs, which generally include sales charges on purchases and may include
redemption or exchange fees. There are also ongoing costs, which generally
include investment advisory fees, and/or Rule 12b-1 fees, and other fund
expenses. The information on this page is intended to help you understand your
ongoing costs of investing in the fund and to compare these costs with the
ongoing costs of investing in other mutual funds.
ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS
To illustrate these ongoing costs, we have provided an example and calculated
the expenses paid by investors in each share class during the reporting period.
The information in the following table is based on an initial investment of
$1,000, which is invested at the beginning of the reporting period and held for
the entire period. Expense information is calculated two ways and each method
provides you with different information. The amount listed in the "actual"
column is calculated using the fund's actual operating expenses and total return
for the period. The amount listed in the "hypothetical" column for each share
class assumes that the return each year is 5% before expenses and includes the
fund's actual expense ratio. You should not use the hypothetical account values
and expenses to estimate either your actual account balance at the end of the
period or the expenses you paid during this reporting period.
MARCH 1, 2004 - AUGUST 31, 2004
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED
BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%)
- --------------------------------------------------------------------------------------------------------------------------
ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL
- --------------------------------------------------------------------------------------------------------------------------
Class A 1,000.00 1,000.00 986.98 1,018.55 6.54 6.65 1.31
- --------------------------------------------------------------------------------------------------------------------------
Class B 1,000.00 1,000.00 983.91 1,014.83 10.22 10.38 2.05
- --------------------------------------------------------------------------------------------------------------------------
Class C 1,000.00 1,000.00 985.07 1,014.83 10.23 10.38 2.05
- --------------------------------------------------------------------------------------------------------------------------
Class D 1,000.00 1,000.00 986.07 1,015.33 9.74 9.88 1.95
- --------------------------------------------------------------------------------------------------------------------------
Class Z 1,000.00 1,000.00 988.29 1,019.86 5.25 5.33 1.05
Expenses paid during the period are equal to the fund's annualized expense
ratio, multiplied by the average account value over the period, then multiplied
by the number of days in the fund's most recent fiscal half-year and divided by
366.
Had the Transfer Agent not waived a portion of expenses, total return would
have been reduced.
It is important to note that the expense amounts shown in the table are meant to
highlight only ongoing costs of investing in the fund and do not reflect any
transactional costs, such as sales charges, redemption or exchange fees.
Therefore, the hypothetical examples provided may not help you determine the
relative total costs of owning different funds. If these transactional costs
were included, your costs would have been higher.
COMPARE WITH OTHER FUNDS
Since all mutual fund companies are required to include the same hypothetical
calculations about expenses in shareholder reports, you can use this information
to compare the ongoing cost of investing in the fund with other funds. To do so,
compare the 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of other funds. As you compare hypothetical
examples of other funds, it is important to note that hypothetical examples are
meant to highlight the continuing cost of investing in a fund and do not reflect
any transactional costs, such as sales charges or redemption or exchange fees.
31
[Sidebar]
SUMMARY
o FOR THE 12-MONTH PERIOD ENDED AUGUST 31, 2004, THE FUND'S CLASS A SHARES
RETURNED 15.64% WITHOUT SALES CHARGE.
o THE FUND, ITS BENCHMARK AND PEER GROUP ALL GENERATED DOUBLE-DIGIT RETURNS
DURING A PERIOD THAT BEGAN ON A FAVORABLE NOTE FOR STOCKS BUT LOST STEAM AS
THE PERIOD WORE ON.
o THE FUND'S LARGE CASH POSITION HURT PERFORMANCE RELATIVE TO ITS BENCHMARK,
THE RUSSELL 3000 VALUE INDEX. HOWEVER, WE BELIEVE THAT STRONG STOCK
SELECTION HELPED THE FUND DO BETTER THAN THE LIPPER MULTI-CAP VALUE FUND
CATEGORY AVERAGE.
[Illustration of two arrows pointing up]
RUSSELL 3000
CLASS A SHARES VALUE INDEX
15.64% 17.64%
OBJECTIVE
Seeks long-term growth of
capital by using a "value"
approach to investing primarily
in common stocks.
TOTAL NET ASSETS
$ 409.4 million
NET ASSET VALUE PER SHARE
AS OF 08/31/04 ($)
CLASS A 18.37
------------------------------------------
CLASS B 18.17
------------------------------------------
CLASS C 18.18
------------------------------------------
CLASS D 18.17
------------------------------------------
CLASS Z 18.42
DISTRIBUTIONS DECLARED PER SHARE
09/01/03 - 08/31/04 ($)
CLASS A 0.07
------------------------------------------
CLASS B 0.00
------------------------------------------
CLASS C 0.00
------------------------------------------
CLASS D 0.00
------------------------------------------
CLASS Z 0.11
PORTFOLIO MANAGERS' REPORT _____________________________________________________
COLUMBIA STRATEGIC INVESTOR FUND
For the 12-month period ended August 31, 2004, Columbia Strategic Investor Fund
class A shares returned 15.64% without sales charge. The fund trailed the
Russell 3000 Value Index, which returned 17.64%. However, it did better than the
Lipper Multi-Cap Value Fund Category average, which was 14.16%. 1 Our decision
to position the fund conservatively by building its cash position hampered
returns relative to its benchmark.
FOCUS ON ECONOMIC RECOVERY AND ENERGY SECTOR
Our decision to emphasize sectors that could benefit from the economic recovery
helped performance in the first half of the fiscal year, CNH Global, Eaton,
Georgia Pacific (which we sold during the period), Dow Chemical and 3M all had a
favorable impact, while energy stocks have been key to the fund's return thus
far in 2004.
Soaring oil and natural gas prices boosted the outlook for energy company
earnings, including those of a key fund holding, oil services firm Transocean.
We added Texas-based Input/Output and Norway's TGS Nopec Geophysical to the
portfolio, expecting these seismic service companies to benefit as large oil
companies sought new deposits of oil and gas. Both stocks posted sharp gains.
CONSUMER AND HEALTH CARE SECTORS
The fund benefited from gains in several non-US consumer stocks. Nokian Renkaat,
a Finnish tire company, and Stockmann, a Finnish department store, benefited
from healthy sales in their core markets as well as new growth opportunities in
Russia and other former Soviet Union countries. However, we pared back our
overall stake in consumer-related stocks during the period because of our
concern that US consumer spending may slow down in an environment of slower
economic growth and rising interest rates. The latter also led us to underweight
financial services companies.
In the health care sector, pharmaceuticals came under pressure amid patent
expirations and anemic new product flows. Yet, some of the fund's
non-pharmaceutical health care holdings posted robust gains. Both Biogen Idec, a
biotechnology firm, and Cytyc, a testing company, reported gains. By contrast,
health services provider Cardinal Health (no longer in the portfolio) declined
amid investigations into its accounting practices.
EMERGING MARKETS
Fading prospects for sustained economic growth caused some emerging and other
international markets to weaken during the second half of the period, after
several consecutive quarters of positive returns. In Korea, Samsung Electronics
fell sharply in late April as its earnings outlook clouded over. However, we
continue to own the stock because we believe
1 Lipper Inc., a widely respected data provider in the industry, calculates an
average total return for mutual funds with similar investment objectives as
the fund.
32
[Sidebar]
TOP 5 SECTORS AS OF 08/31/04 (%)
Health care 11.8
----------------------------------------
Financials 11.4
----------------------------------------
Industrials 11.4
----------------------------------------
Consumer discretionary 9.9
----------------------------------------
Energy 8.0
TOP 10 HOLDINGS AS OF 08/31/04 (%)
3M 1.5
----------------------------------------
JPMorgan Chase & Co. 1.3
----------------------------------------
Samsung Electronics 0.8
----------------------------------------
DST Systems 0.8
----------------------------------------
Microsoft 0.8
----------------------------------------
Transocean 0.7
----------------------------------------
Potash Corp. of Saskatchewan 0.7
----------------------------------------
Citigroup 0.7
----------------------------------------
Schlumberger 0.7
----------------------------------------
HSBC 0.7
HOLDINGS DISCUSSED IN THIS REPORT
AS OF 08/31/04 (%)
CNH Global 0.1
----------------------------------------
Eaton 0.6
----------------------------------------
Dow Chemical 0.3
----------------------------------------
3M 1.5
----------------------------------------
Transocean 0.7
----------------------------------------
Input/Output 0.5
----------------------------------------
TGS Nopec Geophysical 0.5
----------------------------------------
Stockmann 0.4
----------------------------------------
Biogen Idec 0.5
----------------------------------------
Cytyc 0.4
----------------------------------------
Samsung Electronics 0.8
----------------------------------------
Millicom International Cellular 0.4
----------------------------------------
Nestle 0.6
----------------------------------------
Unilever 0.5
----------------------------------------
Nokian Renkaat 0.7
Your fund is actively managed and the composition of its portfolio will change
over time. Information provided is calculated as a percentage of net assets.
________________________________________________________________________________
COLUMBIA STRATEGIC INVESTOR FUND
the company has the potential to rebound. Millicom International Cellular, which
provides cellular phone services in more than a dozen developing countries,
recorded a strong gain for the period despite recent profit-taking. Questions
about the company's licensing in Pakistan made investors uneasy, as did concerns
that arose in other emerging markets where the company operates. We trimmed our
position in the stock.
MORE CONSERVATIVE POSITIONING FOR PORTFOLIO
Beginning in April, larger-capitalization stocks began to outperform small- and
mid-sized issues. This shift, coupled with our concern about the sustainability
of the economic recovery, precipitated our move to place the portfolio on a more
conservative footing. To do this, we cut back on our exposure to economically
sensitive sectors, and shifted our emphasis to larger, more stable growth stocks
in less cyclical sectors. Among our additions were, Nestle and Unilever. In
keeping with our cautious outlook, we allowed the fund's cash position to rise
to approximately 22% by the period's end.
[PHOTO OF Robert A. Unger] Robert A. Unger, CFA, has managed or co-managed
Columbia Strategic Investor Fund since November
2000 and has been with the advisor and its
predecessors since 1984.
/s/ Robert A. Unger
[PHOTO OF Emil A. Gjester] Emil A. Gjester has served as an assistant
portfolio manager or co-portfolio manager of the
fund since November 2002 and has been with the
advisor and its predecessors since 1996.
/s/ Emil A. Gjester
An investment in the fund 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. Stocks of small- and mid-cap companies may trade less
frequently, may trade smaller volumes and may fluctuate more sharply in price
than stocks of larger companies.
33
PERFORMANCE OF A $ 10,000 INVESTMENT
09/01/94 - 08/31/04 ($)
SALES CHARGE WITHOUT WITH
------------------------------------------
Class A 20,769 19,570
------------------------------------------
Class B 20,483 20,483
------------------------------------------
Class C 20,483 20,483
------------------------------------------
Class D 20,500 20,296
------------------------------------------
Class Z 20,914 n/a
Performance data quoted represents past performance and current performance may
be lower or higher. Past performance is no guarantee of future results. The
investment return and principal value will fluctuate so that shares, when
redeemed, may be worth more or less than the original cost. Please visit
www.columbiafunds.com for daily and most recent month-end performance updates.
PERFORMANCE INFORMATION ________________________________________________________
COLUMBIA BALANCED FUND
VALUE OF A $10,000 INVESTMENT 09/01/94 - 08/31/04
[MOUNTAIN CHART]
LEHMAN
CLASS A CLASS A BROTHERS
SHARES WITHOUT SHARES WITH S&P 500 AGGREGATE
SALES CHARGE SALES CHARGE INDEX BOND INDEX
-------------- ------------ ---------- ----------
09/1994 10000.00 9425.00 10000.00 10000.00
9805.00 9241.00 9755.00 9853.00
9822.00 9257.00 9974.00 9844.00
9681.00 9125.00 9611.00 9822.00
9822.00 9257.00 9754.00 9890.00
9958.00 9386.00 10006.00 10086.00
10288.00 9696.00 10397.00 10326.00
10436.00 9836.00 10703.00 10389.00
10567.00 9960.00 11018.00 10535.00
10934.00 10305.00 11459.00 10942.00
11077.00 10440.00 11724.00 11022.00
11291.00 10642.00 12114.00 10998.00
11413.00 10757.00 12144.00 11131.00
11673.00 11002.00 12656.00 11239.00
11656.00 10986.00 12611.00 11385.00
12001.00 11311.00 13165.00 11556.00
12284.00 11578.00 13419.00 11718.00
12438.00 11722.00 13875.00 11795.00
12431.00 11716.00 14004.00 11590.00
12529.00 11809.00 14138.00 11509.00
12578.00 11855.00 14346.00 11444.00
12702.00 11971.00 14716.00 11421.00
12820.00 12083.00 14772.00 11574.00
12558.00 11836.00 14119.00 11606.00
12758.00 12024.00 14417.00 11586.00
13144.00 12389.00 15229.00 11787.00
13301.00 12536.00 15649.00 12049.00
13878.00 13080.00 16832.00 12255.00
13732.00 12943.00 16499.00 12141.00
14070.00 13261.00 17530.00 12179.00
14111.00 13300.00 17667.00 12209.00
13899.00 13100.00 16941.00 12074.00
14289.00 13467.00 17952.00 12255.00
14766.00 13917.00 19045.00 12371.00
15209.00 14334.00 19899.00 12518.00
16076.00 15151.00 21483.00 12856.00
15587.00 14691.00 20280.00 12747.00
16028.00 15106.00 21391.00 12935.00
15847.00 14936.00 20676.00 13122.00
16159.00 15230.00 21634.00 13182.00
16305.00 15367.00 22006.00 13316.00
16533.00 15582.00 22250.00 13486.00
17112.00 16128.00 23854.00 13475.00
17599.00 16587.00 25076.00 13521.00
17699.00 16682.00 25329.00 13591.00
17623.00 16610.00 24893.00 13720.00
18214.00 17166.00 25904.00 13837.00
18137.00 17094.00 25629.00 13866.00
16775.00 15811.00 21923.00 14092.00
17347.00 16350.00 23329.00 14422.00
17909.00 16879.00 25225.00 14346.00
18572.00 17504.00 26754.00 14427.00
19578.00 18453.00 28295.00 14471.00
20136.00 18979.00 29478.00 14573.00
19689.00 18557.00 28561.00 14318.00
20331.00 19162.00 29703.00 14397.00
20527.00 19346.00 30853.00 14443.00
20126.00 18969.00 30125.00 14316.00
20815.00 19618.00 31797.00 14270.00
20402.00 19229.00 30805.00 14209.00
20162.00 19002.00 30654.00 14202.00
20067.00 18913.00 29814.00 14366.00
20689.00 19499.00 31701.00 14420.00
21130.00 19915.00 32345.00 14418.00
22061.00 20793.00 34250.00 14349.00
21552.00 20313.00 32530.00 14302.00
22177.00 20902.00 31915.00 14475.00
23587.00 22231.00 35037.00 14666.00
23094.00 21766.00 33982.00 14623.00
22519.00 21224.00 33286.00 14616.00
23265.00 21927.00 34108.00 14920.00
23193.00 21859.00 33576.00 15056.00
24188.00 22797.00 35661.00 15274.00
23167.00 21835.00 33778.00 15370.00
22824.00 21512.00 33636.00 15472.00
21858.00 20602.00 30985.00 15725.00
22245.00 20966.00 31137.00 16018.00
22652.00 21350.00 32243.00 16281.00
21228.00 20007.00 29302.00 16422.00
20502.00 19323.00 27444.00 16504.00
21389.00 20159.00 29577.00 16435.00
21488.00 20252.00 29775.00 16534.00
21185.00 19967.00 29051.00 16596.00
21125.00 19911.00 28767.00 16968.00
20359.00 19188.00 26966.00 17163.00
19337.00 18225.00 24787.00 17364.00
19712.00 18578.00 25261.00 17727.00
20484.00 19307.00 27198.00 17482.00
20599.00 19415.00 27437.00 17371.00
20311.00 19143.00 27037.00 17511.00
20132.00 18974.00 26515.00 17681.00
20422.00 19248.00 27512.00 17388.00
19740.00 18605.00 25845.00 17725.00
19811.00 18672.00 25653.00 17876.00
18979.00 17888.00 23827.00 18029.00
18009.00 16974.00 21971.00 18247.00
18252.00 17203.00 22114.00 18556.00
17232.00 16241.00 19710.00 18856.00
17894.00 16865.00 21444.00 18770.00
18586.00 17517.00 22707.00 18764.00
17928.00 16897.00 21374.00 19152.00
17693.00 16676.00 20814.00 19170.00
17591.00 16579.00 20502.00 19434.00
17663.00 16647.00 20701.00 19419.00
18567.00 17499.00 22407.00 19580.00
19204.00 18100.00 23588.00 19944.00
19310.00 18199.00 23890.00 19904.00
19340.00 18228.00 24310.00 19235.00
19783.00 18646.00 24784.00 19362.00
19712.00 18579.00 24521.00 19875.00
20374.00 19203.00 25909.00 19691.00
20550.00 19368.00 26137.00 19738.00
21170.00 19953.00 27507.00 19939.00
21367.00 20139.00 28013.00 20099.00
21720.00 20471.00 28402.00 20316.00
21548.00 20309.00 27974.00 20468.00
20975.00 19769.00 27534.00 19936.00
21151.00 19935.00 27912.00 19856.00
21418.00 20186.00 28453.00 19969.00
20707.00 19516.00 27511.00 20167.00
08/2004 20769.00 19570.00 27614.00 20554.00
The graph and table do not reflect the deduction of taxes that a shareholder
would pay on fund distributions or the redemption of fund shares. The Lehman
Brothers Aggregate Bond Index is a market value-weighted index that tracks the
daily price, coupon, pay-downs, and total return performance of fixed-rate,
publicly placed, dollar-denominated, and non-convertible investment grade debt
issues with at least $100 million par amount outstanding and with at least one
year to final maturity. The Standard & Poor's (S&P) 500 Index is an unmanaged
index that tracks the performance of 500 widely held, large-capitalization U.S.
stocks. Unlike mutual funds, indices are not investments, do not incur fees or
expenses and are not professionally managed. It is not possible to invest
directly in an index. Securities in the fund may not match those in an index.
AVERAGE ANNUAL TOTAL RETURN AS OF 08/31/04 (%)
SHARE CLASS A B C D Z
- -----------------------------------------------------------------------------------------------------------
INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 10/01/91
- -----------------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- -----------------------------------------------------------------------------------------------------------
1-year 4.99 -1.04 4.17 -0.83 4.18 3.18 4.14 2.11 5.27
- -----------------------------------------------------------------------------------------------------------
5-year 0.59 -0.60 0.31 -0.02 0.31 0.31 0.33 0.13 0.73
- -----------------------------------------------------------------------------------------------------------
10-year 7.58 6.94 7.43 7.43 7.43 7.43 7.44 7.34 7.66
AVERAGE ANNUAL TOTAL RETURN AS OF 06/30/04 (%)
SHARE CLASS A B C D Z
- -----------------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- -----------------------------------------------------------------------------------------------------------
1-year 10.93 4.55 10.12 5.12 10.12 9.12 10.15 8.05 11.34
- -----------------------------------------------------------------------------------------------------------
5-year 0.57 -0.61 0.32 -0.01 0.32 0.32 0.34 0.13 0.71
- -----------------------------------------------------------------------------------------------------------
10-year 8.43 7.79 8.30 8.30 8.30 8.30 8.31 8.20 8.51
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF
5.75% FOR CLASS A SHARES AND 1% FOR CLASS D SHARES, MAXIMUM CONTINGENT DEFERRED
SALES CHARGE OF 5.00% FOR CLASS B SHARES AND 1.00% FOR CLASS C AND D SHARES FOR
THE FIRST YEAR ONLY.
ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS, IF ANY. CLASS Z SHARES
ARE SOLD AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT
SHARE CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES
ASSOCIATED WITH EACH CLASS.
Effective October 13, 2003, class D shares were closed to all new investors and
new accounts. Existing class D shareholders will be able to make additional
purchases at any time. In addition, the class D initial sales charge of 1.00% is
waived after October 13, 2003.
Performance results reflect any voluntary waivers or reimbursement of fund
expenses by the advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
Classes A, B, and D (newer class shares) share performance information includes
returns of the fund's class Z shares (the oldest existing fund class) for
periods prior to the inception of the newer class shares. The returns for class
C include the returns of class B prior to 10/13/03, the date on which class C
was initially offered by the fund. The returns shown for class C also include
the performance of class Z prior to the inception of class B (11/01/02). Class Z
share returns are not restated to reflect any expense differential (e.g., Rule
12b-1 fees) between class Z shares and the newer class shares. Had the expense
differential been reflected, the returns for the periods prior to the inception
of classes A, B, C, and D would have been lower.
34
[Sidebar]
ESTIMATING YOUR ACTUAL EXPENSES
To estimate the expenses that you paid over the period, first you will need your
account balance at the end of the period:
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS
SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT
WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE
FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE
1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT
BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6
2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD,"
LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE
COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1.
YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING
THE PERIOD
UNDERSTANDING YOUR EXPENSES ____________________________________________________
COLUMBIA BALANCED FUND
As a fund shareholder, you incur two types of costs. There are transaction
costs, which generally include sales charges on purchases and may include
redemption or exchange fees. There are also ongoing costs, which generally
include investment advisory fees, and/or Rule 12b-1 fees, and other fund
expenses. The information on this page is intended to help you understand your
ongoing costs of investing in the fund and to compare these costs with the
ongoing costs of investing in other mutual funds.
ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS
To illustrate these ongoing costs, we have provided an example and calculated
the expenses paid by investors in each share class during the reporting period.
The information in the following table is based on an initial investment of
$1,000, which is invested at the beginning of the reporting period and held for
the entire period. Expense information is calculated two ways and each method
provides you with different information. The amount listed in the "actual"
column is calculated using the fund's actual operating expenses and total return
for the period. The amount listed in the "hypothetical" column for each share
class assumes that the return each year is 5% before expenses and includes the
fund's actual expense ratio. You should not use the hypothetical account values
and expenses to estimate either your actual account balance at the end of the
period or the expenses you paid during this reporting period.
MARCH 1, 2004 - AUGUST 31, 2004
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED
BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%)
- -----------------------------------------------------------------------------------------------------------------------------------
ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL
- -----------------------------------------------------------------------------------------------------------------------------------
Class A 1,000.00 1,000.00 958.78 1,019.96 5.07 5.23 1.03
- -----------------------------------------------------------------------------------------------------------------------------------
Class B 1,000.00 1,000.00 954.50 1,016.19 8.75 9.02 1.78
- -----------------------------------------------------------------------------------------------------------------------------------
Class C 1,000.00 1,000.00 953.15 1,016.19 8.74 9.02 1.78
- -----------------------------------------------------------------------------------------------------------------------------------
Class D 1,000.00 1,000.00 953.10 1,016.19 8.74 9.02 1.78
- -----------------------------------------------------------------------------------------------------------------------------------
Class Z 1,000.00 1,000.00 957.67 1,021.22 3.84 3.96 0.78
Expenses paid during the period are equal to the fund's annualized expense
ratio, multiplied by the average account value over the period, then multiplied
by the number of days in the fund's most recent fiscal half-year and divided by
366.
It is important to note that the expense amounts shown in the table are meant to
highlight only ongoing costs of investing in the fund and do not reflect any
transactional costs, such as sales charges, redemption or exchange fees.
Therefore, the hypothetical examples provided may not help you determine the
relative total costs of owning different funds. If these transactional costs
were included, your costs would have been higher.
COMPARE WITH OTHER FUNDS
Since all mutual fund companies are required to include the same hypothetical
calculations about expenses in shareholder reports, you can use this information
to compare the ongoing cost of investing in the fund with other funds. To do so,
compare the 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of other funds. As you compare hypothetical
examples of other funds, it is important to note that hypothetical examples are
meant to highlight the continuing cost of investing in a fund and do not reflect
any transactional costs, such as sales charges or redemption or exchange fees.
35
[Sidebar]
SUMMARY
o FOR THE 12-MONTH PERIOD ENDED AUGUST 31, 2004, THE FUND'S CLASS A SHARES
RETURNED 4.99% WITHOUT SALES CHARGE.
o THE FUND UNDERPERFORMED THE S&P 500 INDEX, THE LIPPER BALANCED FUNDS
CATEGORY AVERAGE AND THE LEHMAN BROTHERS AGGREGATE BOND INDEX.
o THE FUND'S EMPHASIS ON CONSUMER DISCRETIONARY AND INFORMATION TECHNOLOGY
STOCKS HURT PERFORMANCE IN THE STOCK SECTION OF THE PORTFOLIO. HOWEVER, THE
FUND'S FIXED INCOME STRATEGY RESULTED IN SOLID GAINS.
[Illustration of two arrows pointing up]
S&P 500
CLASS A SHARES INDEX
4.99% 11.46%
OBJECTIVE
Seeks high total return by
investing in common stocks
and debt securities.
TOTAL NET ASSETS
$ 494.7 million
NET ASSET VALUE PER SHARE
AS OF 08/31/04 ($)
Class A 19.86
------------------------------------------
Class B 19.83
------------------------------------------
Class C 19.83
------------------------------------------
Class D 19.82
------------------------------------------
Class Z 19.84
DISTRIBUTIONS DECLARED PER SHARE
09/01/03 - 08/31/04 ($)
Class A 0.28
------------------------------------------
Class B 0.13
------------------------------------------
Class C 0.12
------------------------------------------
Class D 0.15
------------------------------------------
Class Z 0.36
PORTFOLIO MANAGERS' REPORT _____________________________________________________
COLUMBIA BALANCED FUND
For the 12-month period ended August 31, 2004, Columbia Balanced Fund class A
shares returned 4.99% without sales charge. That was lower than both the Lehman
Brothers Aggregate Bond Index, which returned 6.13%, and the S&P 500 Index,
which returned 11.46%. The fund also underperformed the Lipper Balanced Funds
Category average, which was 8.10%. 1 Overexposure to the technology and consumer
discretionary sectors hurt stock portfolio performance. Through the course of
the year, the fund was also underweight in energy and utility stocks, which had
a strong run during the period. In the fixed income portion of the fund,
mortgage-backed securities and corporate bonds helped performance. The fund's
fixed income component slightly outperformed the Lehman Brothers Aggregate Bond
Index.
STOCKS AND BONDS RESPOND TO RISING ECONOMY
Although the fund had impressive returns from selected companies, losers
outnumbered winners over the course of the year. Tech stocks QUALCOMM and Yahoo!
rose more than 70% during the period, and we took profits and sold both stocks.
However losses from other tech holdings, including Veritas Software and Seagate
Technology (both of which we sold), outweighed those gains. Fixed income
securities were stronger than expected because interest rates rose more slowly
than anticipated. The bond market rallied late in 2003 and, despite a volatile
spring, delivered positive returns for the 12-month period.
BULLISH ON CONSUMER DISCRETIONARY SECTOR, CAUTIOUS ON CONSUMER STAPLES
While our above-index exposure to consumer discretionary stocks did not help
relative returns during this reporting period, we continue to believe that the
modest economic growth we expect in the coming year could favor this sector. We
have recently purchased DirecTV Group and increased positions on Comcast.
We have less confidence in the prospects for consumer staples stocks and have
currently a low investment weight in that sector. Higher commodity prices have
driven up the price of basic materials and we believe cost increases will begin
to affect the profitability of consumer staples companies in the coming year. At
the end of the period, we eliminated positions in companies we believe might be
affected by this trend, including Kellogg, Hershey and Avon Products.
NEW HOLDING IN INDUSTRIALS
In a variation on that theme, we added Southwest Airlines to the portfolio at
the end of the period because we were impressed that the company anticipated
rising fuel costs and took action to control them. Southwest has locked in its
fuel costs for 2004 at $24 a barrel, and has locked in 50%
1 Lipper Inc., a widely respected data provider in the industry, calculates an
average total return for mutual funds with similar investment objectives as
those of the fund.
36
[Sidebar]
PORTFOLIO COMPOSITION AS OF 08/31/04 (%)
Common stocks 63.3
------------------------------------------
Corporate notes & bonds 14.5
------------------------------------------
Commercial mortgage-
sacked securities 8.6
------------------------------------------
Collateralized mortgage obligations 6.6
------------------------------------------
Cash & equivalents 3.5
------------------------------------------
Government issues 2.2
------------------------------------------
Asset-backed securities 1.0
------------------------------------------
Preferred Stock 0.3
TOP 10 EQUITY HOLDINGS AS OF 08/31/04 (%)
Microsoft 2.5
------------------------------------------
MGIC Investment 1.8
------------------------------------------
JPMorgan Chase 1.6
------------------------------------------
Citigroup 1.5
------------------------------------------
Fannie Mae 1.4
------------------------------------------
Pfizer 1.3
------------------------------------------
DirecTV Group 1.3
------------------------------------------
Time Warner 1.3
------------------------------------------
Telefonos de Mexico SA 1.3
------------------------------------------
Kohl's 1.3
HOLDINGS DISCUSSED IN THIS REPORT
AS OF 08/31/04 (%)
Comcast 1.1
------------------------------------------
DirecTV Group 1.3
------------------------------------------
Southwest Airlines 1.0
Your fund is actively managed and the composition of its portfolio will change
over time. Information provided is calculated as a percentage of net assets.
________________________________________________________________________________
COLUMBIA BALANCED FUND
of its supply for 2005 at $25 a barrel. With oil prices in the $40 range
throughout much of this year, and many airlines struggling financially, we
believe this has enhanced Southwest's competitive position.
PORTFOLIO STRUCTURE HELPED FIXED INCOME RETURNS
In the fixed income portion of the portfolio, the fund used a "barbell" strategy
to deal with a fluctuating interest-rate environment. We avoided owning
securities in the two-to three-year maturity range and concentrated on both
shorter and longer-term securities. When interest rates rose, securities in that
two- to three-year range were hit hardest, longer-term securities did the best,
and our strategy helped the fund gain ground. The fund's overall duration was
shorter than that of the benchmark--which would generally be a negative in a
period of declining long-term rates. However, the fund's under-weight exposure
to securities in the two-to-three year maturity range helped our competitive
performance because interest rates in that maturity range rose during the
period. Duration is a measure of interest rate sensitivity.
A small position in relatively higher quality, high-yield corporate bonds and an
above-index weight in structured mortgage-backed securities also helped the
fund's return. When mortgage rates change, structured mortgage-backed securities
are less affected by prepayment activity than traditional mortgage-backed
securities.
CAUTIOUS OPTIMISM GOING FORWARD
Although we are generally confident about the prospects for US economic growth,
we believe that it will advance more slowly in the year ahead. We expect that
the Federal Reserve Board will continue to increase short-term interest rates in
a measured way, as it has indicated, and we have positioned the portfolio to
take advantage of opportunities we believe suitable to this environment.
Columbia Balanced Fund is managed by a group of managers from Columbia's large
cap core team:
/s/ John Maack /s/ Guy W. Pope
John Maack Guy W. Pope, CFA
and Columbia's bond team:
/s/ Leonard A. Aplet /s/ Jeffrey L. Rippey
Leonard A. Aplet, CFA Jeffrey L. Rippey, CFA
An investment in the fund may present certain risks, including stock market
fluctuations that occur in response to economic and business developments. The
fund is also subject to risks associated with investments in bonds, including
interest rate risk, credit risk and prepayment risk. High-yield bonds include
increased risk of issuer default and potentially higher price volatility than
other fixed-income investments.
37
[Sidebar]
PERFORMANCE OF A $10,000 INVESTMENT
09/01/94 - 08/31/04 ($)
SALES CHARGE WITHOUT WITH
------------------------------------------
Class A 16,484 15,695
------------------------------------------
Class B 16,250 16,250
------------------------------------------
Class C 16,331 16,331
------------------------------------------
Class D 16,432 16,272
------------------------------------------
Class G 16,318 16,318
------------------------------------------
Class T 16,515 15,725
------------------------------------------
Class Z 16,574 n/a
Performance data quoted represents past performance and current performance may
be lower or higher. Past performance is no guarantee of future results. The
investment return and principal value will fluctuate so that shares, when
redeemed, may be worth more or less than the original cost. Please visit
www.columbiafunds.com for daily and most recent month-end performance updates.
PERFORMANCE INFORMATION ________________________________________________________
COLUMBIA SHORT TERM BOND FUND
VALUE OF A $10,000 INVESTMENT 09/01/94 - 08/31/04
[MOUNTAIN CHART]
MERRILL LYNCH MERRILL LYNCH
CLASS A CLASS A 1-3 YEAR 1-5 YEAR
SHARES WITHOUT SHARES WITH TREASURY GOVERNMENT/
SALES CHARGE SALES CHARGE INDEX CORPORATE INDEX
-------------- ------------ ------------- ---------------
09/1994 10000.00 9525.00 10000.00 10000.00
9969.00 9495.00 9977.00 9948.00
9988.00 9514.00 9999.00 9962.00
9958.00 9485.00 9954.00 9910.00
9969.00 9495.00 9977.00 9936.00
10093.00 9613.00 10116.00 10087.00
10200.00 9715.00 10254.00 10258.00
10252.00 9765.00 10312.00 10320.00
10340.00 9849.00 10403.00 10426.00
10505.00 10006.00 10585.00 10670.00
10552.00 10051.00 10643.00 10734.00
10585.00 10082.00 10686.00 10762.00
10644.00 10139.00 10750.00 10836.00
10690.00 10182.00 10803.00 10898.00
10790.00 10277.00 10894.00 11005.00
10901.00 10383.00 10990.00 11122.00
10986.00 10464.00 11074.00 11222.00
11084.00 10557.00 11168.00 11322.00
11005.00 10482.00 11121.00 11243.00
10955.00 10435.00 11111.00 11212.00
10944.00 10424.00 11120.00 11201.00
10950.00 10430.00 11144.00 11209.00
11035.00 10511.00 11224.00 11305.00
11071.00 10545.00 11268.00 11346.00
11092.00 10565.00 11306.00 11373.00
11208.00 10676.00 11409.00 11498.00
11341.00 10803.00 11538.00 11657.00
11431.00 10888.00 11627.00 11771.00
11410.00 10868.00 11627.00 11740.00
11458.00 10914.00 11681.00 11793.00
11474.00 10929.00 11708.00 11813.00
11441.00 10898.00 11703.00 11785.00
11546.00 10998.00 11799.00 11898.00
11611.00 11060.00 11880.00 11985.00
11688.00 11133.00 11962.00 12078.00
11823.00 11262.00 12093.00 12256.00
11815.00 11254.00 12104.00 12239.00
11892.00 11327.00 12196.00 12353.00
11985.00 11415.00 12286.00 12464.00
11989.00 11420.00 12316.00 12487.00
12068.00 11495.00 12400.00 12580.00
12190.00 11611.00 12520.00 12727.00
12176.00 11597.00 12531.00 12724.00
12210.00 11630.00 12582.00 12774.00
12272.00 11689.00 12642.00 12834.00
12336.00 11750.00 12709.00 12912.00
12384.00 11796.00 12775.00 12987.00
12434.00 11843.00 12835.00 13046.00
12601.00 12003.00 12996.00 13235.00
12783.00 12176.00 13168.00 13472.00
12845.00 12235.00 13233.00 13515.00
12799.00 12191.00 13221.00 13496.00
12845.00 12235.00 13267.00 13546.00
12889.00 12277.00 13320.00 13614.00
12788.00 12181.00 13255.00 13491.00
12877.00 12265.00 13346.00 13602.00
12902.00 12290.00 13389.00 13647.00
12868.00 12256.00 13381.00 13593.00
12909.00 12296.00 13422.00 13633.00
12936.00 12321.00 13465.00 13648.00
12948.00 12333.00 13504.00 13675.00
13023.00 12404.00 13592.00 13786.00
13037.00 12418.00 13629.00 13818.00
13050.00 12430.00 13655.00 13840.00
13075.00 12454.00 13674.00 13843.00
13063.00 12443.00 13668.00 13812.00
13144.00 12520.00 13760.00 13910.00
13197.00 12570.00 13845.00 14019.00
13232.00 12604.00 13881.00 14028.00
13286.00 12655.00 13938.00 14069.00
13390.00 12754.00 14083.00 14255.00
13446.00 12808.00 14172.00 14356.00
13536.00 12893.00 14277.00 14490.00
13593.00 12948.00 14379.00 14620.00
13652.00 13003.00 14457.00 14686.00
13803.00 13148.00 14594.00 14855.00
14026.00 13359.00 14768.00 15070.00
14198.00 13524.00 14953.00 15289.00
14314.00 13635.00 15050.00 15408.00
14419.00 13734.00 15175.00 15548.00
14435.00 13749.00 15216.00 15557.00
14519.00 13829.00 15301.00 15649.00
14569.00 13877.00 15353.00 15707.00
14792.00 14090.00 15525.00 15958.00
14912.00 14204.00 15615.00 16075.00
15113.00 14396.00 15873.00 16363.00
15298.00 14571.00 16023.00 16556.00
15198.00 14476.00 15988.00 16456.00
15160.00 14440.00 15995.00 16422.00
15216.00 14494.00 16027.00 16469.00
15285.00 14559.00 16104.00 16571.00
15198.00 14476.00 15994.00 16406.00
15382.00 14651.00 16173.00 16632.00
15476.00 14740.00 16238.00 16760.00
15567.00 14827.00 16374.00 16906.00
15659.00 14915.00 16574.00 17122.00
15770.00 15021.00 16630.00 17268.00
15934.00 15177.00 16768.00 17487.00
15848.00 15095.00 16807.00 17486.00
15851.00 15098.00 16755.00 17454.00
15995.00 15235.00 16914.00 17721.00
16014.00 15254.00 16912.00 17730.00
16141.00 15374.00 16983.00 17886.00
16155.00 15388.00 17014.00 17922.00
16218.00 15448.00 17046.00 18002.00
16340.00 15564.00 17111.00 18195.00
16347.00 15570.00 17137.00 18219.00
16106.00 15341.00 17044.00 17984.00
16126.00 15360.00 17056.00 17994.00
16297.00 15523.00 17211.00 18281.00
16244.00 15473.00 17148.00 18169.00
16233.00 15462.00 17139.00 18167.00
16335.00 15559.00 17238.00 18305.00
16383.00 15605.00 17273.00 18373.00
16430.00 15650.00 17356.00 18505.00
16496.00 15712.00 17410.00 18609.00
16351.00 15574.00 17243.00 18319.00
16300.00 15526.00 17227.00 18271.00
16310.00 15535.00 17225.00 18291.00
16378.00 15600.00 17287.00 18397.00
08/2004 16484.00 15695.00 17404.00 18608.00
The graph and table do not reflect a deduction of the taxes that a shareholder
would pay on fund distributions or the redemption of fund shares. The Merrill
Lynch 1-3 Year Treasury Index is an unmanaged index that measures the return of
Treasury bills with maturities of 1-3 years and is intended to provide a
benchmark for the prior investment objective and strategy of the fund. The
Merrill Lynch 1-5 Year Government/Corporate Index is an unmanaged index that
includes all US government debt with at least $100 million face value
outstanding, as well as investment-grade rated corporate debt with at least $100
million face value outstanding and a maturity of 1-5 years. Unlike mutual funds,
indices are not investments, do not incur fees or expenses and are not
professionally managed. It is not possible to invest directly in an index.
Securities in the fund may not match those in an index.
AVERAGE ANNUAL TOTAL RETURN AS OF 08/31/04 (%)
SHARE CLASS A B C D G T Z
- --------------------------------------------------------------------------------------------------------------------------------
INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 11/01/02 11/01/02 11/06/86
- --------------------------------------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- --------------------------------------------------------------------------------------------------------------------------------
1-year 2.25 -2.61 1.44 -3.56 1.94 0.94 2.08 0.03 1.65 -3.35 2.31 -2.55 2.51
- --------------------------------------------------------------------------------------------------------------------------------
5-year 4.95 3.94 4.65 4.32 4.75 4.75 4.88 4.68 4.74 4.24 4.99 3.98 5.07
- --------------------------------------------------------------------------------------------------------------------------------
10-year 5.12 4.61 4.97 4.97 5.03 5.03 5.09 4.99 5.02 5.02 5.14 4.63 5.18
AVERAGE ANNUAL TOTAL RETURN AS OF 06/30/04 (%)
SHARE CLASS A B C D G T Z
- --------------------------------------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- --------------------------------------------------------------------------------------------------------------------------------
1-year -0.21 -4.98 -0.98 -5.88 -0.61 -1.59 -0.36 -2.34 -0.78 -5.68 -0.13 -4.91 0.05
- --------------------------------------------------------------------------------------------------------------------------------
5-year 4.79 3.78 4.52 4.18 4.60 4.60 4.73 4.53 4.60 4.09 4.83 3.82 4.90
- --------------------------------------------------------------------------------------------------------------------------------
10-year 5.12 4.61 4.99 4.99 5.03 5.03 5.09 4.99 5.02 5.02 5.14 4.62 5.17
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF
4.75% FOR CLASS A AND T SHARES AND 1% FOR CLASS D SHARES, MAXIMUM CONTINGENT
DEFERRED SALES CHARGE OF 5.00% FOR CLASS B AND G SHARES AND 1.00% FOR CLASS C
AND D SHARES FOR THE FIRST YEAR ONLY.
ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS. CLASS Z SHARES ARE SOLD
AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT SHARE
CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES ASSOCIATED WITH
EACH CLASS.
Effective October 13, 2003, class D shares were closed to all new investors and
new accounts. Existing class D shareholders will be able to make additional
purchases at any time. In addition, class D initial sales charge of 1.00% is
waived after October 13, 2003.
Performance results reflect any voluntary waivers or reimbursement of fund
expenses by the advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
Classes A, B, D, G and T (newer class shares) share performance information
includes returns of the fund's class Z shares (the oldest existing fund class)
for periods prior to the inception of the newer class shares. The returns for
class C include the returns of class B prior to 10/13/03, the date on which
class C was initially offered by the fund. The returns shown for class C also
include the performance of class Z prior to the inception of class B (11/01/02).
Class Z share returns are not restated to reflect any expense differential
(e.g., Rule 12b-1 fees) between class Z shares and the newer class shares. Had
the expense differential been reflected, the returns for the periods prior to
the inception of classes A, B, C, D, G and T would have been lower.
38
[Sidebar]
ESTIMATING YOUR ACTUAL EXPENSES
To estimate the expenses that you paid over the period, first you will need your
account balance at the end of the period:
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS
SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT
WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE
FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE
1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT
BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6
2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD,"
LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE
COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1.
YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING
THE PERIOD
UNDERSTANDING YOUR EXPENSES ____________________________________________________
COLUMBIA SHORT TERM BOND FUND
As a fund shareholder, you incur two types of costs. There are transaction
costs, which generally include sales charges on purchases and may include
redemption or exchange fees. There are also ongoing costs, which generally
include investment advisory fees, and/or Rule 12b-1 fees, and other fund
expenses. The information on this page is intended to help you understand your
ongoing costs of investing in the fund and to compare these costs with the
ongoing costs of investing in other mutual funds.
ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS
To illustrate these ongoing costs, we have provided an example and calculated
the expenses paid by investors in each share class during the reporting period.
The information in the following table is based on an initial investment of
$1,000, which is invested at the beginning of the reporting period and held for
the entire period. Expense information is calculated two ways and each method
provides you with different information. The amount listed in the "actual"
column is calculated using the fund's actual operating expenses and total return
for the period. The amount listed in the "hypothetical" column for each share
class assumes that the return each year is 5% before expenses and includes the
fund's actual expense ratio. You should not use the hypothetical account values
and expenses to estimate either your actual account balance at the end of the
period or the expenses you paid during this reporting period.
MARCH 1, 2004 - AUGUST 31, 2004
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED
BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%)
- -----------------------------------------------------------------------------------------------------------------------------------
ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL
- -----------------------------------------------------------------------------------------------------------------------------------
Class A 1,000.00 1,000.00 1,003.97 1,020.56 4.58 4.62 0.91
- -----------------------------------------------------------------------------------------------------------------------------------
Class B 1,000.00 1,000.00 999.95 1,016.79 8.35 8.42 1.66
- -----------------------------------------------------------------------------------------------------------------------------------
Class C 1,000.00 1,000.00 1,003.37 1,019.81 5.34 5.38 1.06
- -----------------------------------------------------------------------------------------------------------------------------------
Class D 1,000.00 1,000.00 1,003.07 1,019.81 5.34 5.38 1.06
- -----------------------------------------------------------------------------------------------------------------------------------
Class G 1,000.00 1,000.00 1,001.11 1,017.80 7.34 7.41 1.46
- -----------------------------------------------------------------------------------------------------------------------------------
Class T 1,000.00 1,000.00 1,004.27 1,021.06 4.08 4.12 0.81
- -----------------------------------------------------------------------------------------------------------------------------------
Class Z 1,000.00 1,000.00 1,004.78 1,021.82 3.33 3.35 0.66
Expenses paid during the period are equal to the fund's annualized expense
ratio, multiplied by the average account value over the period, then multiplied
by the number of days in the fund's most recent fiscal half-year and divided by
366.
Had the Investment Advisor and/or Distributor not reimbursed a portion of
expenses, total return would have been reduced.
It is important to note that the expense amounts shown in the table are meant to
highlight only ongoing costs of investing in the fund and do not reflect any
transactional costs, such as sales charges, redemption or exchange fees.
Therefore, the hypothetical examples provided may not help you determine the
relative total costs of owning different funds. If these transactional costs
were included, your costs would have been higher.
COMPARE WITH OTHER FUNDS
Since all mutual fund companies are required to include the same hypothetical
calculations about expenses in shareholder reports, you can use this information
to compare the ongoing cost of investing in the fund with other funds. To do so,
compare the 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of other funds. As you compare hypothetical
examples of other funds, it is important to note that hypothetical examples are
meant to highlight the continuing cost of investing in a fund and do not reflect
any transactional costs, such as sales charges or redemption or exchange fees.
39
[Sidebar]
SUMMARY
o FOR THE 12-MONTH PERIOD ENDED AUGUST 31, 2004, THE FUND'S CLASS A SHARES
RETURNED 2.25% WITHOUT SALES CHARGE.
o THE FUND'S RETURN WAS HIGHER THAN THE MERRILL LYNCH 1-3 YEAR TREASURY INDEX,
LOWER THAN THE MERRILL LYNCH 1-5 YEAR GOVERNMENT/CORPORATE INDEX AND ON PAR
WITH THE LIPPER SHORT INVESTMENT GRADE DEBT CATEGORY AVERAGE.
o THE FUND MADE A STRONG SHOWING BY COMBINING SHORT-TERM FLOATING RATE
INSTRUMENTS WITH SECURITIES AT THE LONGER END OF ITS MATURITY SPECTRUM AND
BY EMPHASIZING MORTGAGE BONDS, WHICH HAVE PERFORMED WELL IN 2004.
[Illustration of two arrows pointing up]
MERRILL LYNCH 1-3
CLASS A SHARES YEAR TREASURY INDEX
2.25% 2.05%
OBJECTIVE
Seeks a high level of current
income consistent with a high
degree of principal stability by
investing primarily in short-
term, investment-grade, fixed
income securities.
TOTAL NET ASSETS
$ 525.5 million
NET ASSET VALUE PER SHARE
AS OF 08/31/04 ($)
Class A 8.64
------------------------------------------
Class B 8.64
------------------------------------------
Class C 8.64
------------------------------------------
Class D 8.64
------------------------------------------
Class G 8.64
------------------------------------------
Class T 8.64
------------------------------------------
Class Z 8.64
DISTRIBUTIONS DECLARED PER SHARE
09/01/03 - 08/31/04 ($)
Class A 0.17
------------------------------------------
Class B 0.10
------------------------------------------
Class C 0.14
------------------------------------------
Class D 0.16
------------------------------------------
Class G 0.12
------------------------------------------
Class T 0.18
------------------------------------------
Class Z 0.19
PORTFOLIO MANAGERS' REPORT _____________________________________________________
COLUMBIA SHORT TERM BOND FUND
For the 12-month period ended August 31, 2004, Columbia Short Term Bond Fund
class A shares returned 2.25% without sales charge. The fund's performance was
higher than the benchmark Merrill Lynch 1-3 Year Treasury Index, which returned
2.05%, and lower than the Merrill Lynch 1-5 Year Government/Corporate Index,
which returned 3.37%, during the period. The fund was on par with its peer
group, the Lipper Short Investment Grade Debt Category whose average return was
2.26%. 1 The fund's barbell structure, which combines short-term floating rate
instruments with securities at the longer end of its maturity spectrum, was
chiefly responsible for the strong showing.
BARBELL STRUCTURE HELPED PERFORMANCE
For most of the 12-month period, the fixed-income market rewarded investors who
were willing to take on risk by investing in bonds with longer maturities or
lower credit quality. This environment was slightly negative for the fund, which
concentrates on higher quality short-term bonds. In addition, the fund
sacrificed some performance by maintaining a shorter duration than its index as
long-term interest rates fell. Duration is a measure of interest-rate
sensitivity.
However, the fund was able to generate a competitive return because of its
barbell structure. We owned short-term floating rate notes, which carried higher
yields than Treasury securities of comparable maturities. We also owned
longer-term securities--in this context, those with maturities of about five
years--which increased in value as long-term interest rates declined.
The Federal Reserve Board raised the federal funds rate--the key overnight bank
lending rate--from 1.00% to 1.25% in June and to 1.50% in August. 2 In
anticipation of the Fed's action, fixed income markets were weak during the
spring and early summer. Lower quality bonds were especially weak, reversing a
trend that had been in place for over a year. In this changed environment, the
fund's relatively defensive positioning was helpful.
MORTGAGE STRATEGY PAID OFF AS RATES FLUCTUATED
The fund also was aided by its emphasis on the mortgage sector. During the first
part of the period, we shifted investments from conventional pass through
securities into structured instruments such as CMOs (collateralized mortgage
obligations). This was a defensive move in advance of rising interest rates.
Refinancing activity tends to slow when interest rates rise, delaying the return
of principal to holders of conventional mortgage bonds.
1 Lipper Inc., a widely respected data provider in the industry, calculates an
average total return for mutual funds with similar investment objectives as
the fund.
2 In September, the federal funds rate was raised to 1.75%.
40
[Sidebar]
PORTFOLIO QUALITY AS OF 08/31/04 (%)
Aaa 34.7
------------------------------------------
Aa 9.5
------------------------------------------
A 21.0
------------------------------------------
Baa 11.7
------------------------------------------
Agency 17.2
------------------------------------------
Treasury 5.9
Portfolio quality is calculated as a percentage of total investments.
Ratings shown represent the highest rating assigned to a particular bond by one
of the following nationally recognized rating agencies: Standard & Poor's
Corporation, Moody's Investors Service, Inc. or Fitch Ratings Ltd.
PORTFOLIO COMPOSITION AS OF 08/31/04 (%)
Corporate notes & bonds 39.2
------------------------------------------
Collateralized mortgage obligations 26.1
------------------------------------------
Asset-backed securities 11.0
------------------------------------------
Mortgage-backed securities 11.0
------------------------------------------
Cash & cash equivalents,
net receivables & payables 6.5
------------------------------------------
Government issues 6.2
MATURITY BREAKDOWN AS OF 08/31/04 (%)
0-1 years 44.1
------------------------------------------
1-3 years 34.6
------------------------------------------
3-5 years 18.9
------------------------------------------
5+ years 2.4
Your fund is actively managed and the composition of its portfolio will change
over time. Portfolio composition and maturity breakdown are calculated as a
percentage of net assets.
________________________________________________________________________________
COLUMBIA SHORT TERM BOND FUND
The benefit of our strategy emerged as short-term rates rose and long-term rates
declined near the end of the period. In this environment, mortgage bonds were
strong performers.
FUND POSITIONED FOR HIGHER RATES AHEAD
Because we had expected higher short-term interest rates for some time, we did
not have to make significant adjustments to the fund after the Fed declared that
a series of incremental rate hikes may be in store. In particular, our emphasis
on floating rate securities, whose interest payments are adjusted with market
rates, helped to position the fund for higher short-term rates.
Leonard A. Aplet, CFA, has co-managed Columbia Short
Term Bond Fund since November 2000 and has been with
the advisor and its predecessors since 1987.
/s/ Leonard A. Aplet
Richard R. Cutts, CFA, has co-managed the fund since
December 2002 and has been with the advisor and its
predecessors since 1994.
/s/ Richard R. Cutts
The fund offers the potential for current income and
capital preservation but is subject to interest rate
risk, credit risk and prepayment risk.
41
[Sidebar]
PERFORMANCE OF A $ 10,000 INVESTMENT
09/01/94 - 08/31/04 ($)
SALES CHARGE WITHOUT WITH
------------------------------------------
Class A 19,334 18,413
------------------------------------------
Class B 19,067 19,067
------------------------------------------
Class C 19,092 19,092
------------------------------------------
Class D 19,137 18,942
------------------------------------------
Class Z 19,481 n/a
Performance data quoted represents past performance and current performance may
be lower or higher. Past performance is no guarantee of future results. The
investment return and principal value will fluctuate so that shares, when
redeemed, may be worth more or less than the original cost. Please visit
www.columbiafunds.com for daily and most recent month-end performance updates.
PERFORMANCE INFORMATION_________________________________________________________
COLUMBIA FIXED INCOME SECURITIES FUND
VALUE OF A $10,000 INVESTMENT 09/01/94 - 08/31/04
[MOUNTAIN CHART]
LEHMAN
CLASS A CLASS A BROTHERS
SHARES WITHOUT SHARES WITH AGGREGATE
SALES CHARGE SALES CHARGE BOND INDEX
------------ ------------ ----------
09/1994 10000.00 9525.00 10000.00
9858.00 9390.00 9853.00
9836.00 9369.00 9844.00
9814.00 9348.00 9822.00
9889.00 9420.00 9890.00
10079.00 9600.00 10086.00
10308.00 9818.00 10326.00
10378.00 9885.00 10389.00
10531.00 10030.00 10535.00
10951.00 10431.00 10942.00
11038.00 10514.00 11022.00
11010.00 10487.00 10998.00
11148.00 10619.00 11131.00
11270.00 10735.00 11239.00
11418.00 10875.00 11385.00
11592.00 11042.00 11556.00
11759.00 11201.00 11718.00
11831.00 11269.00 11795.00
11612.00 11060.00 11590.00
11535.00 10987.00 11509.00
11447.00 10903.00 11444.00
11421.00 10879.00 11421.00
11582.00 11032.00 11574.00
11601.00 11050.00 11606.00
11592.00 11041.00 11586.00
11800.00 11240.00 11787.00
12050.00 11478.00 12049.00
12273.00 11690.00 12255.00
12157.00 11579.00 12141.00
12205.00 11626.00 12179.00
12243.00 11662.00 12209.00
12113.00 11538.00 12074.00
12292.00 11708.00 12255.00
12406.00 11817.00 12371.00
12549.00 11952.00 12518.00
12894.00 12281.00 12856.00
12779.00 12172.00 12747.00
12963.00 12347.00 12935.00
13160.00 12535.00 13122.00
13199.00 12572.00 13182.00
13320.00 12687.00 13316.00
13479.00 12839.00 13486.00
13469.00 12829.00 13475.00
13500.00 12858.00 13521.00
13570.00 12925.00 13591.00
13704.00 13053.00 13720.00
13815.00 13159.00 13837.00
13836.00 13179.00 13866.00
14061.00 13393.00 14092.00
14328.00 13648.00 14422.00
14202.00 13528.00 14346.00
14262.00 13585.00 14427.00
14312.00 13632.00 14471.00
14414.00 13729.00 14573.00
14137.00 13465.00 14318.00
14227.00 13552.00 14397.00
14274.00 13596.00 14443.00
14104.00 13434.00 14316.00
14042.00 13375.00 14270.00
13948.00 13286.00 14209.00
13920.00 13259.00 14202.00
14092.00 13422.00 14366.00
14131.00 13460.00 14420.00
14148.00 13476.00 14418.00
14093.00 13423.00 14349.00
14010.00 13344.00 14302.00
14153.00 13480.00 14475.00
14332.00 13652.00 14666.00
14282.00 13604.00 14623.00
14271.00 13593.00 14616.00
14580.00 13888.00 14920.00
14684.00 13986.00 15056.00
14907.00 14199.00 15274.00
15011.00 14298.00 15370.00
15094.00 14377.00 15472.00
15369.00 14639.00 15725.00
15681.00 14936.00 16018.00
15958.00 15200.00 16281.00
16097.00 15332.00 16422.00
16184.00 15415.00 16504.00
16082.00 15318.00 16435.00
16190.00 15421.00 16534.00
16237.00 15466.00 16596.00
16609.00 15820.00 16968.00
16768.00 15972.00 17163.00
16944.00 16139.00 17364.00
17286.00 16465.00 17727.00
17070.00 16259.00 17482.00
16956.00 16151.00 17371.00
17059.00 16249.00 17511.00
17198.00 16381.00 17681.00
16955.00 16150.00 17388.00
17269.00 16448.00 17725.00
17400.00 16573.00 17876.00
17464.00 16635.00 18029.00
17632.00 16794.00 18247.00
17934.00 17082.00 18556.00
18195.00 17331.00 18856.00
17984.00 17130.00 18770.00
17964.00 17111.00 18764.00
18238.00 17371.00 19152.00
18259.00 17392.00 19170.00
18513.00 17634.00 19434.00
18500.00 17622.00 19419.00
18639.00 17754.00 19580.00
18937.00 18038.00 19944.00
18877.00 17980.00 19904.00
18274.00 17406.00 19235.00
18390.00 17516.00 19362.00
18857.00 17961.00 19875.00
18691.00 17803.00 19691.00
18681.00 17794.00 19738.00
18853.00 17958.00 19939.00
18998.00 18096.00 20099.00
19175.00 18264.00 20316.00
19309.00 18392.00 20468.00
18863.00 17967.00 19936.00
18741.00 17851.00 19856.00
18819.00 17926.00 19969.00
18998.00 18096.00 20167.00
08/2004 19334.00 18413.00 20554.00
The graph and table do not reflect the deduction of taxes that a shareholder
would pay on fund distributions or the redemption of fund shares. The Lehman
Brothers Aggregate Bond Index is a market value-weighted index that tracks the
daily price, coupon, pay-downs, and total return performance of fixed-rate,
publicly placed, dollar-denominated, and non-convertible investment grade debt
issues with at least $100 million par amount outstanding and with at least one
year to final maturity. Unlike mutual funds, indices are not investments, do not
incur fees or expenses and are not professionally managed. It is not possible to
invest directly in an index. Securities in the fund may not match those in an
index.
AVERAGE ANNUAL TOTAL RETURN AS OF 08/31/04 (%)
SHARE CLASS A B C D Z
- ----------------------------------------------------------------------------------------------------
INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 02/25/83
- ----------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- ----------------------------------------------------------------------------------------------------
1-year 5.13 0.10 4.33 -0.67 4.47 3.47 4.51 2.52 5.40
- ----------------------------------------------------------------------------------------------------
5-year 6.79 5.75 6.49 6.18 6.52 6.52 6.57 6.35 6.95
- ----------------------------------------------------------------------------------------------------
10-year 6.81 6.29 6.67 6.67 6.68 6.68 6.71 6.60 6.90
AVERAGE ANNUAL TOTAL RETURN AS OF 06/30/04 (%)
SHARE CLASS A B C D Z
- ----------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- ----------------------------------------------------------------------------------------------------
1-year -0.30 -5.06 -1.05 -5.85 -0.95 -1.91 -0.85 -2.80 0.04
- ----------------------------------------------------------------------------------------------------
5-year 6.04 5.01 5.77 5.45 5.79 5.79 5.84 5.63 6.19
- ----------------------------------------------------------------------------------------------------
10-year 6.72 6.21 6.59 6.59 6.60 6.60 6.63 6.52 6.80
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF
4.75% FOR CLASS A SHARES AND 1% FOR CLASS D SHARES, MAXIMUM CONTINGENT DEFERRED
SALES CHARGE OF 5.00% FOR CLASS B SHARES AND 1.00% FOR CLASS C AND D SHARES FOR
THE FIRST YEAR ONLY.
ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS. CLASS Z SHARES ARE SOLD
AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT SHARE
CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES ASSOCIATED WITH
EACH CLASS.
Effective October 13, 2003, class D shares were closed to all new investors and
new accounts. Existing class D shareholders will be able to make additional
purchases at any time. In addition, the class D initial sales charge of 1.00% is
waived after October 13, 2003.
Performance results reflect any voluntary waivers or reimbursement of fund
expenses by the advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
Classes A, B, and D (newer class shares) share performance information includes
returns of the fund's class Z shares (the oldest existing fund class) for
periods prior to the inception of the newer class shares. The returns for class
C include the returns of class B prior to 10/13/03, the date on which class C
was initially offered by the fund. The returns shown for class C also include
the performance of class Z prior to the inception of class B (11/01/02). Class Z
share returns are not restated to reflect any expense differential (e.g., Rule
12b-1 fees) between class Z shares and the newer class shares. Had the expense
differential been reflected, the returns for the periods prior to the inception
of classes A, B, C and D would have been lower.
42
[Sidebar]
ESTIMATING YOUR ACTUAL EXPENSES
To estimate the expenses that you paid over the period, first you will need your
account balance at the end of the period:
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS
SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT
WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE
FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE
1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT
BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6
2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD,"
LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE
COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1.
YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING
THE PERIOD
UNDERSTANDING YOUR EXPENSES ____________________________________________________
COLUMBIA FIXED INCOME SECURITIES FUND
As a fund shareholder, you incur two types of costs. There are transaction
costs, which generally include sales charges on purchases and may include
redemption or exchange fees. There are also ongoing costs, which generally
include investment advisory fees, and/or Rule 12b-1 fees, and other fund
expenses. The information on this page is intended to help you understand your
ongoing costs of investing in the fund and to compare these costs with the
ongoing costs of investing in other mutual funds.
ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS
To illustrate these ongoing costs, we have provided an example and calculated
the expenses paid by investors in each share class during the reporting period.
The information in the following table is based on an initial investment of
$1,000, which is invested at the beginning of the reporting period and held for
the entire period. Expense information is calculated two ways and each method
provides you with different information. The amount listed in the "actual"
column is calculated using the fund's actual operating expenses and total return
for the period. The amount listed in the "hypothetical" column for each share
class assumes that the return each year is 5% before expenses and includes the
fund's actual expense ratio. You should not use the hypothetical account values
and expenses to estimate either your actual account balance at the end of the
period or the expenses you paid during this reporting period.
MARCH 1, 2004 -- AUGUST 31, 2004
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED
BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%)
- -----------------------------------------------------------------------------------------------------------
ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL
- -----------------------------------------------------------------------------------------------------------
Class A 1,000.00 1,000.00 1,010.05 1,019.61 5.56 5.58 1.10
- -----------------------------------------------------------------------------------------------------------
Class B 1,000.00 1,000.00 1,005.78 1,015.84 9.33 9.37 1.85
- -----------------------------------------------------------------------------------------------------------
Class C 1,000.00 1,000.00 1,005.93 1,016.59 8.57 8.62 1.70
- -----------------------------------------------------------------------------------------------------------
Class D 1,000.00 1,000.00 1,005.78 1,016.59 8.57 8.62 1.70
- -----------------------------------------------------------------------------------------------------------
Class Z 1,000.00 1,000.00 1,008.95 1,020.86 4.29 4.32 0.85
Expenses paid during the period are equal to the fund's annualized expense
ratio, multiplied by the average account value over the period, then multiplied
by the number of days in the fund's most recent fiscal half-year and divided by
366.
Had the Distributor not waived a portion of expenses, total return would have
been reduced.
It is important to note that the expense amounts shown in the table are meant to
highlight only ongoing costs of investing in the fund and do not reflect any
transactional costs, such as sales charges, redemption or exchange fees.
Therefore, the hypothetical examples provided may not help you determine the
relative total costs of owning different funds. If these transactional costs
were included, your costs would have been higher.
COMPARE WITH OTHER FUNDS
Since all mutual fund companies are required to include the same hypothetical
calculations about expenses in shareholder reports, you can use this information
to compare the ongoing cost of investing in the fund with other funds. To do so,
compare the 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of other funds. As you compare hypothetical
examples of other funds, it is important to note that hypothetical examples are
meant to highlight the continuing cost of investing in a fund and do not reflect
any transactional costs, such as sales charges or redemption or exchange fees.
43
[Sidebar]
SUMMARY
o FOR THE 12-MONTH PERIOD ENDED AUGUST 31, 2004, THE FUND'S CLASS A SHARES
RETURNED 5.13% WITHOUT SALES CHARGE.
o BECAUSE THE FUND WAS POSITIONED CONSERVATIVELY AT A TIME WHEN RISK-TAKING
WAS REWARDED, IT TRAILED ITS BENCHMARK, THE LEHMAN BROTHERS AGGREGATE BOND
INDEX, AND THE AVERAGE RETURN OF ITS PEER GROUP, THE LIPPER CORPORATE DEBT
FUNDS A RATED CATEGORY.
o A SUBSTANTIAL ALLOCATION TO MORTGAGE BONDS AIDED PERFORMANCE AS THESE BONDS
DID EXCEPTIONALLY WELL.
[Illustration of two arrows pointing up]
LEHMAN BROTHERS
AGGREGATE
CLASS A SHARES BOND INDEX
5.13% 6.13%
OBJECTIVE
Seeks a high level of income by
investing in a broad range of
debt securities with intermediate
to long-term maturities.
TOTAL NET ASSETS
$ 341.3 million
NET ASSET VALUE PER SHARE
AS OF 08/31/04 ($)
Class A 13.49
------------------------------------------
Class B 13.49
------------------------------------------
Class C 13.49
------------------------------------------
Class D 13.49
------------------------------------------
Class Z 13.49
DISTRIBUTIONS DECLARED PER SHARE
09/01/03 - 08/31/04 ($)
Class A 0.52
------------------------------------------
Class B 0.42
------------------------------------------
Class C 0.40
------------------------------------------
Class D 0.44
------------------------------------------
Class Z 0.56
PORTFOLIO MANAGERS' REPORT _____________________________________________________
COLUMBIA FIXED INCOME SECURITIES FUND
For the 12-month period ended August 31, 2004, Columbia Fixed Income Securities
Fund class A shares returned 5.13% without sales charge. By comparison, the
Lehman Brothers Aggregate Bond Index and the Lipper Corporate Debt Funds A Rated
Category average returned 6.13% and 5.99%, respectively, over the same period. 1
The fund trailed its benchmark and peer group because it was positioned
conservatively at a time when risk-taking was rewarded.
CORPORATE BONDS OUTPERFORMED TREASURIES
For most of the 12-month period, corporate bonds outperformed Treasury
securities. As the economic recovery progressed, investors gained confidence in
the corporate sector and were attracted to the higher yields it offered. For the
full year, corporate bonds returned 7.49% as measured by the Lehman Brothers
U.S. Credit Index, well above the 5.38% return from Treasury securities. Among
corporate bond issues, securities with lower credit ratings tended to outperform
those with higher ratings.
Although we increased the fund's commitment to corporate bonds during the
period, the portfolio's above-average credit quality caused a slight performance
shortfall relative to its index and peer group. The fund devoted only 7% of its
assets to the high-yield sector, which was by far the best performing sector
within the fixed-income market during the period.
Short-term interest rates rose relative to longer-term rates during the period.
For maturities of 10 years and longer, this was somewhat better-than-expected
performance for a time of sustained economic growth. As a result, longer-term
maturities tended to outperform shorter-term securities. This trend was slightly
negative for the fund, whose average maturity was slightly less than that of its
index and peer group.
SECTOR ALLOCATION AIDED PERFORMANCE
The fund benefited from its substantial allocation to the mortgage sector, which
gained 5.98% as measured by the Lehman Brothers Mortgage-Backed Securities Index
during the 12-month period. Among our mortgage investments, we emphasized
collateralized mortgage obligations, or CMOs, which offer a yield advantage over
Treasuries and are less sensitive to changes in interest rates than conventional
mortgage securities. Higher rates hurt conventional mortgage securities because
fewer homeowners refinance their mortgages when interest rates rise, thus
delaying the return of principal to bond holders.
In a widely anticipated move, policymakers at the Federal Reserve Board raised a
key overnight bank lending rate twice during the period. The Fed raised the
federal funds rate from 1.00% to 1.25% in June and to 1.50% in August. 2 The
fund's bias toward higher quality securities helped
1 Lipper, Inc., a widely respected data provider in the industry, calculates
an average total return for mutual funds with similar investment objectives
as the fund.
2 In September, the federal funds rate was raised to 1.75%.
44
[Sidebar]
PORTFOLIO QUALITY AS OF 08/31/04 (%)
Treasury/Agency 45.1
------------------------------------------
Aaa 13.0
------------------------------------------
Aa 7.9
------------------------------------------
A 14.5
------------------------------------------
Baa 12.4
------------------------------------------
Ba 4.1
------------------------------------------
B 3.0
Portfolio quality is calculated as a percentage of total investments.
Ratings shown represent the highest rating assigned to a particular bond by one
of the nationally recognized rating agencies: Standard and Poor's Corporation,
Moody's Investors Service, Inc. or Fitch Ratings Ltd.
PORTFOLIO COMPOSITION
AS OF 08/31/04 (%)
Corporate notes & bonds 42.5
------------------------------------------
Collateralized mortgage obligations 23.8
------------------------------------------
Mortgage-backed securities 22.2
------------------------------------------
U.S. Government & Agency 5.9
------------------------------------------
Asset-backed securities 4.0
------------------------------------------
Cash & cash equivalents,
net receivables & payables 1.6
MATURITY BREAKDOWN AS OF 08/31/04 (%)
0-1 years 13.4
------------------------------------------
1-5 years 51.2
------------------------------------------
5-10 years 25.0
------------------------------------------
10-20 years 2.4
------------------------------------------
20+ years 8.0
Your fund is actively managed and the composition of its portfolio will change
over time. Portfolio composition and maturity breakdown are calculated as a
percentage of net assets.
________________________________________________________________________________
COLUMBIA FIXED INCOME SECURITIES FUND
the fund after the Fed's action. Our minimal exposure to high-yield securities
aided performance when low quality bonds declined sharply in July, erasing much
of their earlier gains.
DEFENSIVE POSITIONING MAINTAINED
Now that the Fed has signaled its intentions to raise short-term interest rates
at a "measured" pace, we see every reason to maintain our defensive positioning.
Overall, we expect to keep the fund's average maturity relatively short and its
average credit quality relatively high. In addition, we continue to emphasize
floating rate securities and to maintain a small allocation to Treasury
Inflation Protected Securities, or TIPs, which provide price protection against
rising inflation.
Leonard A. Aplet, CFA, has co-managed Columbia Fixed
Income Securities Fund since January1988 and has
been with the advisor and its predecessors since
1987.
/s/ Leonard A. Aplet
Richard R. Cutts, CFA, has co-managed the fund since
December 2002 and has been with the advisor and its
predecessors since 1994.
/s/ Richard R. Cutts
Investing in fixed-income securities offers the potential for attractive current
income and total returns but also involves certain risks. The value and return
of your investment may fluctuate as a result of changes in interest rates; the
financial strength of issuers of lower-rated bonds; foreign, political and
economic developments; and changes in currency exchange rates.
45
[Sidebar]
PERFORMANCE OF A $ 10,000 INVESTMENT
02/24/99 - 08/31/04 ($)
SALES CHARGE WITHOUT WITH
--------------------------------------------
Class A 13,061 12,439
--------------------------------------------
Class B 12,886 12,786
--------------------------------------------
Class C 12,927 12,927
--------------------------------------------
Class D 12,962 12,834
--------------------------------------------
Class Z 13,129 n/a
Performance data quoted represents past performance and current performance may
be lower or higher. Past performance is no guarantee of future results. The
investment return and principal value will fluctuate so that shares, when
redeemed, may be worth more or less than the original cost. Please visit
www.columbiafunds.com for daily and most recent month-end performance updates.
PERFORMANCE INFORMATION ________________________________________________________
COLUMBIA NATIONAL MUNICIPAL BOND FUND
VALUE OF A $10,000 INVESTMENT 02/24/99 - 08/31/04
[MOUNTAIN CHART]
LEHMAN
CLASS A CLASS A BROTHERS
SHARES WITHOUT SHARES WITH MUNICIPAL
SALES CHARGE SALES CHARGE BOND INDEX
-------------- ------------ ----------
02/1999 10000.00 9525.00 10000.00
9934.00 9462.00 10014.00
9920.00 9449.00 10039.00
9951.00 9478.00 9981.00
9893.00 9423.00 9837.00
9733.00 9271.00 9872.00
9768.00 9304.00 9794.00
9671.00 9212.00 9797.00
9675.00 9216.00 9692.00
9567.00 9112.00 9794.00
9674.00 9214.00 9721.00
9608.00 9152.00 9678.00
9543.00 9089.00 9790.00
9641.00 9183.00 10004.00
9868.00 9399.00 9945.00
9791.00 9326.00 9893.00
9714.00 9253.00 10155.00
9985.00 9511.00 10296.00
10110.00 9630.00 10455.00
10267.00 9779.00 10401.00
10209.00 9724.00 10514.00
10336.00 9845.00 10594.00
10407.00 9913.00 10856.00
10654.00 10148.00 10963.00
10749.00 10238.00 10998.00
10765.00 10253.00 11097.00
10861.00 10345.00 10977.00
10737.00 10227.00 11096.00
10844.00 10329.00 11170.00
10918.00 10399.00 11335.00
11082.00 10555.00 11522.00
11256.00 10721.00 11483.00
11216.00 10684.00 11620.00
11346.00 10807.00 11522.00
11217.00 10684.00 11413.00
11097.00 10570.00 11610.00
11297.00 10760.00 11750.00
11426.00 10883.00 11519.00
11205.00 10673.00 11744.00
11454.00 10910.00 11816.00
11517.00 10970.00 11941.00
11649.00 11096.00 12095.00
11818.00 11257.00 12240.00
11952.00 11384.00 12508.00
12236.00 11655.00 12300.00
12017.00 11446.00 12249.00
11950.00 11382.00 12507.00
12209.00 11629.00 12476.00
12137.00 11561.00 12651.00
12328.00 11742.00 12658.00
12339.00 11753.00 12742.00
12431.00 11841.00 13040.00
12733.00 12129.00 12985.00
12665.00 12063.00 12531.00
12210.00 11630.00 12625.00
12302.00 11717.00 12996.00
12694.00 12091.00 12931.00
12585.00 11987.00 13065.00
12694.00 12091.00 13174.00
12803.00 12195.00 13249.00
12851.00 12240.00 13448.00
13074.00 12453.00 13401.00
12985.00 12369.00 13083.00
12647.00 12046.00 13036.00
12644.00 12043.00 13083.00
12693.00 12090.00 13255.00
12843.00 12233.00 13524.00
08/2004 13061.00 12439.00
The graph and table do not reflect a deduction of the taxes that a shareholder
would pay on fund distributions or the redemption of fund shares. The Lehman
Brothers Municipal Bond Index is an unmanaged index considered representative of
the broad market for investment-grade, tax exempt bonds with a maturity of at
least one year. Unlike mutual funds, indices are not investments, do not incur
fees or expenses and are not professionally managed. It is not possible to
invest directly in an index. Securities in the fund may not match those in an
index. Index performance is from February 28, 1999.
AVERAGE ANNUAL TOTAL RETURN AS OF 08/31/04 (%)
SHARE CLASS A B C D Z
INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 02/24/99
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- -------------------------------------------------------------------------------------------------
1-year 6.22 1.17 5.44 0.44 5.77 4.77 5.79 3.77 6.47
- -------------------------------------------------------------------------------------------------
5-year 6.19 5.17 5.91 5.59 5.98 5.98 6.03 5.81 6.30
- -------------------------------------------------------------------------------------------------
Life 4.96 4.04 4.70 4.56 4.76 4.76 4.82 4.63 5.06
AVERAGE ANNUAL TOTAL RETURN AS OF 06/30/04 (%)
SHARE CLASS A B C D Z
- -------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- -------------------------------------------------------------------------------------------------
1-year 0.21 -4.55 -0.53 -5.32 -0.31 -1.27 -0.21 -2.19 0.42
- -------------------------------------------------------------------------------------------------
5-year 5.44 4.42 5.19 4.86 5.23 5.23 5.30 5.08 5.55
- -------------------------------------------------------------------------------------------------
Life 4.55 3.60 4.31 4.16 4.36 4.36 4.42 4.22 4.65
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF
4.75% FOR CLASS A SHARES AND 1% FOR CLASS D SHARES, MAXIMUM CONTINGENT DEFERRED
SALES CHARGE OF 5.00% FOR CLASS B SHARES AND 1.00% FOR CLASS C AND D SHARES FOR
THE FIRST YEAR ONLY.
ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS. CLASS Z SHARES ARE SOLD
AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT SHARE
CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES ASSOCIATED WITH
EACH CLASS.
Effective October 13, 2003, class D shares were closed to all new investors and
new accounts. Existing class D shareholders will be able to make additional
purchases at any time. In addition, class D initial sales charge of 1.00% is
waived after October 13, 2003.
Performance results reflect any voluntary waivers or reimbursement of fund
expenses by the advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
Classes A, B, and D (newer class shares) share performance information includes
returns of the fund's class Z shares (the oldest existing fund class) for
periods prior to the inception of the newer class shares. The returns for class
C include the returns of class B prior to 10/13/03, the date on which class C
was initially offered by the fund. The returns shown for class C also include
the performance of class Z prior to the inception of class B (11/01/02). Class Z
share returns are not restated to reflect any expense differential (e.g., Rule
12b-1 fees) between class Z shares and the newer class shares. Had the expense
differential been reflected, the returns for the periods prior to the inception
of classes A, B, C, and D would have been lower.
46
[Sidebar]
ESTIMATING YOUR ACTUAL EXPENSES
To estimate the expenses that you paid over the period, first you will need your
account balance at the end of the period:
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS
SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT
WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE
FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE
1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT
BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6
2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD,"
LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE
COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1.
YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING
THE PERIOD
UNDERSTANDING YOUR EXPENSES ____________________________________________________
COLUMBIA NATIONAL MUNICIPAL BOND FUND
As a fund shareholder, you incur two types of costs. There are transaction
costs, which generally include sales charges on purchases and may include
redemption or exchange fees. There are also ongoing costs, which generally
include investment advisory fees, and/or Rule 12b-1 fees, and other fund
expenses. The information on this page is intended to help you understand your
ongoing costs of investing in the fund and to compare these costs with the
ongoing costs of investing in other mutual funds.
ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS
To illustrate these ongoing costs, we have provided an example and calculated
the expenses paid by investors in each share class during the reporting period.
The information in the following table is based on an initial investment of
$1,000, which is invested at the beginning of the reporting period and held for
the entire period. Expense information is calculated two ways and each method
provides you with different information. The amount listed in the "actual"
column is calculated using the fund's actual operating expenses and total return
for the period. The amount listed in the "hypothetical" column for each share
class assumes that the return each year is 5% before expenses and includes the
fund's actual expense ratio. You should not use the hypothetical account values
and expenses to estimate either your actual account balance at the end of the
period or the expenses you paid during this reporting period.
MARCH 1, 2004 - AUGUST 31, 2004
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED
BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%)
- -----------------------------------------------------------------------------------------------------------
ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL
- -----------------------------------------------------------------------------------------------------------
Class A 1,000.00 1,000.00 999.40 1,020.61 4.52 4.57 0.90
- -----------------------------------------------------------------------------------------------------------
Class B 1,000.00 1,000.00 995.73 1,016.84 8.28 8.36 1.65
- -----------------------------------------------------------------------------------------------------------
Class C 1,000.00 1,000.00 997.89 1,018.60 6.53 6.60 1.30
- -----------------------------------------------------------------------------------------------------------
Class D 1,000.00 1,000.00 997.39 1,018.60 6.53 6.60 1.30
- -----------------------------------------------------------------------------------------------------------
Class Z 1,000.00 1,000.00 1,000.55 1,021.87 3.27 3.30 0.65
Expenses paid during the period are equal to the fund's annualized expense
ratio, multiplied by the average account value over the period, then multiplied
by the number of days in the fund's most recent fiscal half-year and divided by
366.
Had the Investment Advisor and/or Distributor not reimbursed or waived a portion
of expenses, total return would have been reduced.
It is important to note that the expense amounts shown in the table are meant to
highlight only ongoing costs of investing in the fund and do not reflect any
transactional costs, such as sales charges, redemption or exchange fees.
Therefore, the hypothetical examples provided may not help you determine the
relative total costs of owning different funds. If these transactional costs
were included, your costs would have been higher.
COMPARE WITH OTHER FUNDS
Since all mutual fund companies are required to include the same hypothetical
calculations about expenses in shareholder reports, you can use this information
to compare the ongoing cost of investing in the fund with other funds. To do so,
compare the 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of other funds. As you compare hypothetical
examples of other funds, it is important to note that hypothetical examples are
meant to highlight the continuing cost of investing in a fund and do not reflect
any transactional costs, such as sales charges or redemption or exchange fees.
47
[Sidebar]
SUMMARY
o FOR THE 12-MONTH PERIOD ENDED AUGUST 31, 2004, THE FUND'S CLASS A SHARES
RETURNED 6.22% WITHOUT SALES CHARGE.
o THE FUND UNDERPERFORMED ITS BENCHMARK, THE LEHMAN BROTHERS MUNICIPAL BOND
INDEX, BUT OUTPERFORMED THE AVERAGE FOR ITS PEER GROUP, THE LIPPER
INTERMEDIATE MUNICIPAL DEBT FUNDS CATEGORY.
o THE FUND'S INVESTMENTS IN NON-RATED BONDS HELPED PERFORMANCE, WHILE OUR
FOCUS ON INTERMEDIATE MATURITIES DETRACTED FROM PERFORMANCE. BONDS WITH
LONGER MATURITIES GENERALLY PROVIDED HIGHER RETURNS.
[Illustration of two arrows pointing up]
LEHMAN BROTHERS
MUNICIPAL BOND
CLASS A SHARES INDEX
6.22% 7.11%
OBJECTIVE
Seeks a high level of income
exempt from federal income tax
by investing primarily in
municipal securities issued by
state and local governments, their
agencies and authorities, as well
as the District of Columbia and
U.S. territories and possessions.
TOTAL NET ASSETS
$14.8 million
NET ASSET VALUE PER SHARE
AS OF 08/31/04 ($)
Class A 10.30
------------------------------------------
Class B 10.30
------------------------------------------
Class C 10.30
------------------------------------------
Class D 10.30
------------------------------------------
Class Z 10.30
DISTRIBUTIONS DECLARED PER SHARE
09/01/03 - 08/31/04 ($)
Class A 0.43
------------------------------------------
Class B 0.35
------------------------------------------
Class C 0.35
------------------------------------------
Class D 0.39
------------------------------------------
Class Z 0.45
PORTFOLIO MANAGER'S REPORT _____________________________________________________
COLUMBIA NATIONAL MUNICIPAL BOND FUND
For the 12-month period ended August 31, 2004, Columbia National Municipal Bond
Fund class A shares returned 6.22% without sales charge. This was lower than the
return of its benchmark, the Lehman Brothers Municipal Bond Index, which was
7.11% over the same period. However, the fund beat the average return of the
Lipper Intermediate Municipal Debt Funds Category, which was 5.06%. 1 Our focus
on intermediate-maturity bonds, at a time when bonds with longer maturities were
providing higher returns, hurt performance relative to our benchmark. However,
we believe that contributions from non-rated bonds, helped the fund outperform
the average for its peer group.
A VOLATILE PERIOD FOR MUNICIPAL BONDS
Although municipal bonds provided good returns for the period covered by this
report, they experienced considerable volatility--especially in the second half
of the period. Early in the period, bond yields drifted lower and bond prices
moved higher as inflation remained in check and manufacturers continued to
operate below capacity. However interest rates rose sharply following strong
employment reports in the spring of 2004. As a result, long-term yields rose
sharply and bond prices fell. To complicate matters, non-traditional investors,
such as hedge funds, moved money in and out of the municipal market in an
attempt to take advantage of short-term price fluctuations. Their presence in
the market heightened volatility.
AVERAGE MATURITY REDUCED, GEOGRAPHIC DIVERSIFICATION INCREASED
The fund continued to emphasize high-quality issues while increasing the
portfolio's national diversification. We reduced the average maturity of the
fund to 9.02 years and reduced the fund's duration to 5.5 years. Duration
measures the fund's sensitivity to a given change in interest rates. Typically,
we lower duration when we expect interest rates to rise and lengthen duration
when we expect rates to fall. Thus, we lowered duration in an effort to give the
portfolio some price protection against rising interest rates.
The fund's non-rated bonds did well during the period as investors took on more
risk for potentially higher returns. However, we sold some of these bonds during
the period because we grew concerned about the financial strength of certain
issuers. Proceeds from these sales were shifted into higher-quality bonds, which
also aided the fund's geographic diversification. For example, we reduced the
fund's exposure to Oregon and Washington State and put more money in California,
Florida and New York, where we saw the potential to add yield and value to the
portfolio.
1 Lipper Inc., a widely respected data provider in the industry, calculates an
average total return for mutual funds with similar investment objectives as
the fund.
48
[Sidebar]
PORTFOLIO QUALITY AS OF 08/31/04 (%)
AAA 58.8
------------------------------------------
AA 15.8
------------------------------------------
A 4.0
------------------------------------------
BBB 1.1
------------------------------------------
Non Rated 11.0
------------------------------------------
Net cash & equivalents 9.3
Ratings shown represent the highest rating assigned to a particular bond by one
of the nationally-recognized rating agencies: Standard and Poor's Corporation,
Moody's Investors Service, Inc. or Fitch Ratings, Ltd.
TOP 10 STATES AS OF 08/31/04 (%)
Washington 13.1
------------------------------------------
Oregon 10.2
------------------------------------------
Illinois 8.2
------------------------------------------
Michigan 4.8
------------------------------------------
Texas 4.7
------------------------------------------
Tennessee 4.4
------------------------------------------
New York 3.8
------------------------------------------
Indiana 3.6
------------------------------------------
Wisconsin 3.6
------------------------------------------
California 3.3
Your fund is actively managed and the composition of its portfolio will change
over time. Portfolio composition and holdings discussed are calculated as a
percentage of net assets.
MATURITY BREAKDOWN AS OF 08/31/04 (%)
0-1 years 1.4
------------------------------------------
1-3 years 1.8
------------------------------------------
3-5 years 4.4
------------------------------------------
5-7 years 10.5
------------------------------------------
7-10 years 28.1
------------------------------------------
10-15 years 36.7
------------------------------------------
15-20 years 7.1
------------------------------------------
20-25 years 0.7
------------------------------------------
Net cash & equivalents 9.3
Portfolio quality and maturity breakdown are calculated as a percentage of total
investments.
ABOUT DURATION
Duration is a measure, expressed in years, of interest-rate sensitivity. It is
similar to maturity, but because it takes into consideration the entire stream
of future principal and interest payments and how long it will take to collect
them, it is a more complex and more accurate measure of a fund's exposure to
changing interest rates.
Because we are active duration managers, we tend to use duration as a tactical
tool to anticipate or respond to interest rate changes. Because bond prices and
interest rates move in opposite directions, we lower duration when we expect
interest rates to rise and we raise duration when we expect interest rates to
fall. This adjustment provides the potential to benefit performance. If we are
wrong and interest rates rise after we lengthen duration, or fall after we
shorten duration, fund performance could be hurt.
________________________________________________________________________________
COLUMBIA NATIONAL MUNICIPAL BOND FUND
POTENTIAL FOR A MORE STABLE ECONOMIC ENVIRONMENT
Our outlook is for a more stable economic climate for municipal bonds in coming
months. As long as growth is maintained at a modest pace, state and local
governments should be able to expect higher tax revenues, which would aid their
balance sheets and maintain or improve their credit ratings. These factors have
the potential to create a better environment for existing bonds.
Going forward, we plan to maintain our focus on intermediate-maturity bonds.
However, given that interest rates are higher than they were one year ago, our
focus has shifted away from the longer end of the intermediate maturity range,
because these bonds are more vulnerable to rising rates than prices of
shorter-term bonds. We continue to reduce the fund's already small position in
bonds subject to the alternative minimum tax.
Susan Sanderson has managed Columbia National
Municipal Bond Fund since December 2003 and has been
with the advisor and its predecessors since 1985.
/s/ Susan Sanderson
Tax-exempt investing offers current tax-free income, but it also involves
certain risks. The value of the fund shares will be affected by interest rate
changes and the creditworthiness of issues held in the fund. Interest income
from certain tax-exempt bonds may be subject to the federal alternative minimum
tax for individuals and corporations. Capital gains earned on tax-exempt
investments are taxable.
49
[Sidebar]
PERFORMANCE OF A $ 10,000 INVESTMENT
09/01/94 - 08/31/04 ($)
SALES CHARGE WITHOUT WITH
------------------------------------------
Class A 17,411 16,580
------------------------------------------
Class B 17,174 17,174
------------------------------------------
Class C 17,228 17,228
------------------------------------------
Class D 17,292 17,120
------------------------------------------
Class Z 17,526 n/a
Performance data quoted represents past performance and current performance may
be lower or higher. Past performance is no guarantee of future results. The
investment return and principal value will fluctuate so that shares, when
redeemed, may be worth more or less than the original cost. Please visit
www.columbiafunds.com for daily and most recent month-end performance updates.
PERFORMANCE INFORMATION ________________________________________________________
COLUMBIA OREGON MUNICIPAL BOND FUND
VALUE OF A $10,000 INVESTMENT 09/01/94 - 08/31/04
[MOUNTAIN CHART]
LEHMAN
BROTHERS
CLASS A CLASS A GENERAL
SHARES WITHOUT SHARES WITH OBLIGATION
SALES CHARGE SALES CHARGE BOND INDEX
-------------- ------------ ----------
09/1994 10000.00 9525.00 10000.00
9868.00 9399.00 9860.00
9746.00 9283.00 9718.00
9588.00 9132.00 9565.00
9779.00 9314.00 9735.00
10013.00 9538.00 9965.00
10236.00 9749.00 10229.00
10343.00 9852.00 10367.00
10354.00 9863.00 10374.00
10609.00 10105.00 10683.00
10524.00 10024.00 10610.00
10615.00 10111.00 10732.00
10750.00 10239.00 10869.00
10822.00 10308.00 10938.00
10948.00 10428.00 11063.00
11100.00 10573.00 11219.00
11165.00 10634.00 11308.00
11229.00 10696.00 11417.00
11173.00 10643.00 11365.00
11056.00 10531.00 11239.00
11011.00 10488.00 11199.00
11003.00 10480.00 11181.00
11113.00 10585.00 11294.00
11206.00 10674.00 11402.00
11207.00 10675.00 11400.00
11337.00 10799.00 11541.00
11451.00 10907.00 11676.00
11630.00 11077.00 11893.00
11583.00 11033.00 11845.00
11613.00 11061.00 11877.00
11706.00 11150.00 11985.00
11582.00 11032.00 11831.00
11658.00 11105.00 11923.00
11795.00 11235.00 12101.00
11901.00 11336.00 12231.00
12204.00 11625.00 12548.00
12126.00 11550.00 12436.00
12254.00 11672.00 12578.00
12314.00 11729.00 12647.00
12372.00 11784.00 12707.00
12551.00 11955.00 12887.00
12671.00 12070.00 13020.00
12656.00 12055.00 13030.00
12646.00 12045.00 13042.00
12603.00 12004.00 12973.00
12786.00 12178.00 13186.00
12814.00 12205.00 13233.00
12843.00 12233.00 13265.00
13037.00 12418.00 13475.00
13199.00 12572.00 13655.00
13177.00 12551.00 13658.00
13216.00 12588.00 13703.00
13250.00 12621.00 13748.00
13417.00 12780.00 13928.00
13314.00 12682.00 13857.00
13322.00 12689.00 13863.00
13361.00 12726.00 13902.00
13239.00 12610.00 13824.00
13051.00 12431.00 13622.00
13102.00 12480.00 13676.00
12989.00 12372.00 13596.00
12996.00 12379.00 13608.00
12862.00 12251.00 13490.00
12991.00 12374.00 13627.00
12898.00 12286.00 13541.00
12818.00 12210.00 13491.00
12926.00 12312.00 13626.00
13195.00 12568.00 13901.00
13124.00 12500.00 13831.00
13042.00 12423.00 13757.00
13358.00 12723.00 14111.00
13540.00 12897.00 14297.00
13745.00 13093.00 14501.00
13673.00 13023.00 14428.00
13822.00 13165.00 14579.00
13911.00 13251.00 14681.00
14223.00 13547.00 15028.00
14385.00 13702.00 15191.00
14426.00 13740.00 15237.00
14542.00 13852.00 15371.00
14385.00 13702.00 15211.00
14539.00 13849.00 15365.00
14631.00 13936.00 15460.00
14833.00 14128.00 15680.00
15072.00 14356.00 15932.00
15031.00 14317.00 15897.00
15222.00 14499.00 16059.00
15047.00 14332.00 15918.00
14869.00 14163.00 15790.00
15111.00 14394.00 16049.00
15288.00 14562.00 16245.00
15013.00 14300.00 15935.00
15307.00 14580.00 16263.00
15404.00 14672.00 16353.00
15586.00 14845.00 16536.00
15794.00 15044.00 16741.00
15981.00 15222.00 16932.00
16331.00 15555.00 17274.00
16032.00 15270.00 16994.00
15910.00 15154.00 16911.00
16224.00 15453.00 17242.00
16160.00 15393.00 17213.00
16411.00 15631.00 17450.00
16398.00 15619.00 17483.00
16512.00 15728.00 17597.00
16904.00 16101.00 17986.00
16811.00 16012.00 17900.00
16211.00 15441.00 17305.00
16316.00 15541.00 17466.00
16807.00 16009.00 17968.00
16684.00 15892.00 17847.00
16860.00 16059.00 17994.00
16998.00 16190.00 18121.00
17062.00 16252.00 18212.00
17375.00 16549.00 18498.00
17248.00 16429.00 18448.00
16818.00 16019.00 18033.00
16815.00 16016.00 18008.00
16881.00 16079.00 18078.00
17073.00 16262.00 18297.00
08/2004 17411.00 16580.00 18642.00
The graph and table do not reflect a deduction of the taxes that a shareholder
would pay on fund distributions or the redemption of fund shares. The Lehman
Brothers General Obligation Bond Index is a unmanaged index that represents
average market-weighted performance of general obligation securities that have
been issued in the last five years with maturities greater than one year. Unlike
mutual funds, indices are not investments, do not incur fees or expenses and are
not professionally managed. It is not possible to invest directly in an index.
Securities in the fund may not match those in an index.
AVERAGE ANNUAL TOTAL RETURN AS OF 08/31/04 (%)
SHARE CLASS A B C D Z
- -------------------------------------------------------------------------------------------------
INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 07/02/84
- -------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- -------------------------------------------------------------------------------------------------
1-year 6.68 1.61 5.87 0.87 6.20 5.20 6.25 4.20 6.97
- -------------------------------------------------------------------------------------------------
5-year 6.03 5.01 5.74 5.42 5.81 5.81 5.89 5.67 6.17
- -------------------------------------------------------------------------------------------------
10-year 5.70 5.19 5.56 5.56 5.59 5.59 5.63 5.52 5.77
AVERAGE ANNUAL TOTAL RETURN AS OF 06/30/04 (%)
SHARE CLASS A B C D Z
- -------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- -------------------------------------------------------------------------------------------------
1-year 0.41 -4.36 -0.36 -5.14 -0.12 -1.07 0.02 -1.93 0.72
- -------------------------------------------------------------------------------------------------
5-year 5.29 4.26 5.03 4.70 5.08 5.08 5.16 4.95 5.42
- -------------------------------------------------------------------------------------------------
10-year 5.57 5.06 5.44 5.44 5.47 5.47 5.51 5.40 5.64
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF
4.75% FOR CLASS A SHARES AND 1% FOR CLASS D SHARES, MAXIMUM CONTINGENT DEFERRED
SALES CHARGE OF 5.00% FOR CLASS B SHARES AND 1.00% CONTINGENT SALES CHARGE FOR
CLASS C AND D SHARES FOR THE FIRST YEAR ONLY.
ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS. CLASS Z SHARES ARE SOLD
AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT SHARE
CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES ASSOCIATED WITH
EACH CLASS.
Effective October 13, 2003, class D shares were closed to all new investors and
new accounts. Existing class D shareholders will be able to make additional
purchases at any time. In addition, class D initial sales charge of 1.00% is
waived after October 13, 2003.
Performance results reflect any voluntary waivers or reimbursement of fund
expenses by the advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
Classes A, B, and D (newer class shares) share performance information includes
returns of the fund's class Z shares (the oldest existing fund class) for
periods prior to the inception of the newer class shares. The returns for class
C include the returns of class B prior to 10/13/03, the date on which class C
was initially offered by the fund. The returns shown for class C also include
the performance of class Z prior to the inception of class B (11/01/02). Class Z
share returns are not restated to reflect any expense differential (e.g., Rule
12b-1 fees) between class Z shares and the newer class shares. Had the expense
differential been reflected, the returns for the periods prior to the inception
of classes A, B, C, and D would have been lower.
50
[Sidebar]
ESTIMATING YOUR ACTUAL EXPENSES
To estimate the expenses that you paid over the period, first you will need your
account balance at the end of the period:
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS
SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT
WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE
FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE
1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT
BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6
2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD,"
LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE
COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1.
YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING
THE PERIOD
UNDERSTANDING YOUR EXPENSES ____________________________________________________
COLUMBIA OREGON MUNICIPAL BOND FUND
As a fund shareholder, you incur two types of costs. There are transaction
costs, which generally include sales charges on purchases and may include
redemption or exchange fees. There are also ongoing costs, which generally
include investment advisory fees, and/or Rule 12b-1 fees, and other fund
expenses. The information on this page is intended to help you understand your
ongoing costs of investing in the fund and to compare these costs with the
ongoing costs of investing in other mutual funds.
ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS
To illustrate these ongoing costs, we have provided an example and calculated
the expenses paid by investors in each share class during the reporting period.
The information in the following table is based on an initial investment of
$1,000, which is invested at the beginning of the reporting period and held for
the entire period. Expense information is calculated two ways and each method
provides you with different information. The amount listed in the "actual"
column is calculated using the fund's actual operating expenses and total return
for the period. The amount listed in the "hypothetical" column for each share
class assumes that the return each year is 5% before expenses and includes the
fund's actual expense ratio. You should not use the hypothetical account values
and expenses to estimate either your actual account balance at the end of the
period or the expenses you paid during this reporting period.
MARCH 1, 2004 - AUGUST 31, 2004
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED
BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%)
- -----------------------------------------------------------------------------------------------------------
ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL
- -----------------------------------------------------------------------------------------------------------
Class A 1,000.00 1,000.00 1,003.12 1,020.61 4.53 4.57 0.90
- -----------------------------------------------------------------------------------------------------------
Class B 1,000.00 1,000.00 998.99 1,016.84 8.29 8.36 1.65
- -----------------------------------------------------------------------------------------------------------
Class C 1,000.00 1,000.00 1,000.00 1,018.60 6.54 6.60 1.30
- -----------------------------------------------------------------------------------------------------------
Class D 1,000.00 1,000.00 1,000.40 1,018.60 6.54 6.60 1.30
- -----------------------------------------------------------------------------------------------------------
Class Z 1,000.00 1,000.00 1,003.17 1,021.87 3.27 3.30 0.65
Expenses paid during the period are equal to the fund's annualized expense
ratio, multiplied by the average account value over the period, then multiplied
by the number of days in the fund's most recent fiscal half-year and divided by
366.
Had the Distributor not waived a portion of expenses for class C and class D,
total return would have been reduced.
It is important to note that the expense amounts shown in the table are meant to
highlight only ongoing costs of investing in the fund and do not reflect any
transactional costs, such as sales charges, redemption or exchange fees.
Therefore, the hypothetical examples provided may not help you determine the
relative total costs of owning different funds. If these transactional costs
were included, your costs would have been higher.
COMPARE WITH OTHER FUNDS
Since all mutual fund companies are required to include the same hypothetical
calculations about expenses in shareholder reports, you can use this information
to compare the ongoing cost of investing in the fund with other funds. To do so,
compare the 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of other funds. As you compare hypothetical
examples of other funds, it is important to note that hypothetical examples are
meant to highlight the continuing cost of investing in a fund and do not reflect
any transactional costs, such as sales charges or redemption or exchange fees.
51
[Sidebar]
SUMMARY
o FOR THE 12-MONTH PERIOD ENDED AUGUST 31, 2004, THE FUND'S CLASS A SHARES
RETURNED 6.68% WITHOUT SALES CHARGE.
o THE FUND'S RETURN FELL JUST SHORT OF THE RETURN OF ITS BENCHMARK, THE
LEHMAN BROTHERS GENERAL OBLIGATION BOND INDEX, BUT WAS HIGHER THAN THE
AVERAGE RETURN FOR ITS PEER GROUP, THE LIPPER OREGON MUNICIPAL DEBT FUNDS
CATEGORY.
o THE FUND BENEFITED FROM ITS FOCUS ON BONDS WITH INTERMEDIATE MATURITIES,
WHICH WERE THE STRONGEST-PERFORMERS IN THE OREGON BOND MARKET DURING THE
PERIOD.
[Illustration of two arrows pointing up]
LEHMAN BROTHERS
GENERAL OBLIGATION
CLASS A SHARES BOND INDEX
6.68% 6.76%
OBJECTIVE
Seeks a high level of income=
exempt from federal and Oregon
income tax by investing
primarily in municipal securities
issued by the state of Oregon.
TOTAL NET ASSETS
$440.4 million
NET ASSET VALUE PER SHARE
AS OF 08/31/04 ($)
Class A 12.45
------------------------------------------
Class B 12.45
------------------------------------------
Class C 12.45
------------------------------------------
Class D 12.45
------------------------------------------
Class Z 12.45
DISTRIBUTIONS DECLARED PER SHARE
09/01/03 - 08/31/04 ($)
Class A 0.60
------------------------------------------
Class B 0.51
------------------------------------------
Class C 0.51
------------------------------------------
Class D 0.55
------------------------------------------
Class Z 0.64
PORTFOLIO MANAGER'S REPORT _____________________________________________________
COLUMBIA OREGON MUNICIPAL BOND FUND
For the 12-month period ended August 31, 2004, Columbia Oregon Municipal Bond
Fund class A shares returned 6.68% without sales charge. This was slightly less
than the fund's benchmark, the Lehman Brothers General Obligation Bond Index,
which returned 6.76%. The fund outperformed its peer group, the Lipper Oregon
Municipal Debt Funds Category, which returned an average of 5.72%. 1 The fund
benefited from its focus on bonds with intermediate maturities, which performed
better than either short or longer-term bonds in the Oregon municipal market
during the period. The fund's investment in non-rated bonds also made a positive
contribution to performance.
A VOLATILE PERIOD FOR MUNICIPAL BONDS
Although municipal bonds provided good returns for the period covered by this
report, they experienced considerable volatility--especially in the second half
of the period. Early in the period, bond yields drifted lower and bond prices
moved higher as inflation remained in check and manufacturers continued to
operate below capacity. However interest rates rose sharply following strong
employment reports in the spring of 2004. As a result, long-term yields rose
sharply and bond prices fell. To complicate matters, non-traditional investors,
such as hedge funds, moved money in and out of the municipal market in an
attempt to take advantage of short-term price fluctuations. Their presence in
the market heightened volatility.
Oregon, like many other states, has benefited from increased revenues resulting
from an improving economy. However, the state's economy, which relied heavily on
the technology industry in the 1990s, remained behind the rest of the country.
While the state has recently experienced some job growth, it has had one of the
highest unemployment rates in the country since 2000.
MIXED RESULTS FROM SECTOR ALLOCATION AND SECURITY SELECTION
The fund benefited from its holdings of hospital and non-rated bonds. Hospital
bonds performed well as the financial outlook improved for many issuers. The
fund's non-rated bonds gained ground as investors were increasingly willing to
accept more risk for potentially higher returns.
As low mortgage rates favored individual home ownership over rental housing, our
investments in multi-family housing bonds underperformed. In general, it was
difficult for issuers to maintain occupancy levels as home ownership rates
climbed. As a result, we cut back on exposure to housing bonds, particularly
some multi-family
1 Lipper Inc., a widely respected data provider in the industry, calculates an
average total return for mutual funds with similar investment objectives as
the fund.
52
[Sidebar]
PORTFOLIO QUALITY AS OF 08/31/04 (%)
AAA 43.1
------------------------------------------
AA 35.1
------------------------------------------
A 5.7
------------------------------------------
BBB 3.5
------------------------------------------
D 0.1
------------------------------------------
Non rated 10.6
------------------------------------------
Net cash & equivalents 1.9
Ratings shown represent the highest rating assigned to a particular bond by one
of the nationally-recognized rating agencies: Standard and Poor's Corporation,
Moody's Investors Service, Inc. or Fitch Ratings, Ltd.
PORTFOLIO COMPOSITION
AS OF 08/31/04 (%)
Oregon Revenue 33.0
------------------------------------------
General obligations 19.2
------------------------------------------
Insured revenue 19.0
------------------------------------------
Insured general obligations 14.2
------------------------------------------
Other bonds 6.5
------------------------------------------
State of Oregon general obligations 2.6
------------------------------------------
Pre-funded bond 2.3
------------------------------------------
Cash & cash equivalents,
net receivables & payables 2.8
------------------------------------------
U.S. territories bonds 0.4
HOLDINGS DISCUSSED IN THIS REPORT
AS OF 08/31/04 (%)
Oregon Coast Aquarium
(Oregon St Health Hsg Edl) 0.1
MATURITY BREAKDOWN AS OF 08/31/04 (%)
0-1 years 0.5
------------------------------------------
1-3 years 2.0
------------------------------------------
3-5 years 2.9
------------------------------------------
5-7 years 12.3
------------------------------------------
7-10 years 29.3
------------------------------------------
10-15 years 33.8
------------------------------------------
15-20 years 11.7
------------------------------------------
20-25 years 3.2
------------------------------------------
25+ years 2.4
------------------------------------------
Net cash & equivalents 1.9
Portfolio quality and maturity breakdown are calculated as a percentage of total
investments.
Your fund is actively managed and the composition of its portfolio will change
over time. Portfolio composition and holdings discussed are calculated as a
percentage of net assets.
________________________________________________________________________________
COLUMBIA OREGON MUNICIPAL BOND FUND
housing projects. Also, our position in Oregon Coast Aquarium bonds hurt
performance. The Oregon Coast Aquarium has experienced severe cash shortfalls as
a result of a decline in tourism. We continue to work with the Aquarium to
restructure its debt or find other ways to enhance the value of its outstanding
bonds.
POTENTIAL FOR A STABLE ECONOMIC ENVIRONMENT
Our outlook calls for increasing stability in the economy market. As long as a
modest rate of growth is maintained, state and local governments should be able
to expect higher tax revenues, which would aid their balance sheets and maintain
or improve their credit quality. We see Oregon revenue streams picking up if
employment and tax revenues gradually increase. We expect Oregon's muni market
to benefit from a steady, although lower, level of issuance and continued strong
demand.
Going forward, we expect to maintain our focus on the intermediate maturity
range, which we believe offers the best opportunity in a stable economic
climate. As a result, we shifted some assets to the longer end of the
intermediate maturity range, which we believe is likely to benefit most from an
improved economy. In an effort to increase tax-exempt returns to shareholders,
we plan to continue to reduce the fund's exposure to bonds subject to the
alternative minimum tax.
[PHOTO OF Brian McGreevy] Brian McGreevy has managed the Columbia Oregon
Municipal Bond Fund since December 2003 and has been
with the advisor and its predecessors since 1994.
/s/ Brian McGreevy
Tax-exempt investing offers current tax-free income, but it also involves
certain risks. The value of the fund shares will be affected by interest rate
changes and the creditworthiness of issues held in the funds. Single-state
municipal bond funds pose additional risks due to limited geographical
diversification. Interest income from certain tax-exempt bonds may be subject to
the federal alternative minimum tax for individuals and corporations. Capital
gains earned on tax-exempt investments are taxable.
53
[Sidebar]
PERFORMANCE OF A $ 10,000 INVESTMENT
09/01/94 - 08/31/04 ($)
SALES CHARGE WITHOUT WITH
------------------------------------------
Class A 20,872 19,885
------------------------------------------
Class B 20,561 20,561
------------------------------------------
Class C 20,576 20,576
------------------------------------------
Class D 20,626 20,428
------------------------------------------
Class Z 20,983 n/a
Performance data quoted represents past performance and current performance may
be lower or higher. Past performance is no guarantee of future results. The
investment return and principal value will fluctuate so that shares, when
redeemed, may be worth more or less than the original cost. Please visit
www.columbiafunds.com for daily and most recent month-end performance updates.
PERFORMANCE INFORMATION ________________________________________________________
COLUMBIA HIGH YIELD FUND
VALUE OF A $10,000 INVESTMENT 09/01/94 - 08/31/04
[MOUNTAIN CHART]
MERRILL LYNCH
CLASS A CLASS A US HIGH YIELD,
SHARES WITHOUT SHARES WITH CASH PAY
SALES CHARGE SALES CHARGE ONLY INDEX
-------------- ------------ --------------
09/1994 10000.00 9525.00 10000.00
10050.00 9573.00 9996.00
10061.00 9583.00 10021.00
9949.00 9477.00 9936.00
10052.00 9574.00 10046.00
10209.00 9724.00 10188.00
10460.00 9963.00 10506.00
10555.00 10054.00 10652.00
10791.00 10279.00 10901.00
11064.00 10539.00 11241.00
11141.00 10612.00 11326.00
11295.00 10758.00 11456.00
11315.00 10777.00 11525.00
11498.00 10952.00 11657.00
11650.00 11097.00 11740.00
11783.00 11223.00 11855.00
11972.00 11404.00 12045.00
12139.00 11562.00 12236.00
12179.00 11600.00 12254.00
12041.00 11469.00 12221.00
12024.00 11453.00 12227.00
12035.00 11464.00 12315.00
12069.00 11496.00 12389.00
12158.00 11581.00 12473.00
12389.00 11801.00 12602.00
12604.00 12005.00 12873.00
12742.00 12137.00 13014.00
13010.00 12392.00 13277.00
13102.00 12480.00 13379.00
13218.00 12590.00 13483.00
13418.00 12781.00 13671.00
13216.00 12588.00 13520.00
13372.00 12737.00 13674.00
13693.00 13042.00 13950.00
13865.00 13207.00 14162.00
14238.00 13562.00 14502.00
14225.00 13550.00 14477.00
14416.00 13731.00 14717.00
14403.00 13719.00 14815.00
14567.00 13875.00 14955.00
14765.00 14064.00 15097.00
15006.00 14293.00 15322.00
15095.00 14378.00 15385.00
15188.00 14467.00 15517.00
15264.00 14539.00 15590.00
15311.00 14584.00 15700.00
15420.00 14688.00 15778.00
15608.00 14867.00 15868.00
14989.00 14277.00 15182.00
15254.00 14529.00 15213.00
15181.00 14460.00 14963.00
15682.00 14937.00 15644.00
15686.00 14941.00 15649.00
15879.00 15125.00 15804.00
15792.00 15042.00 15684.00
15980.00 15221.00 15819.00
16093.00 15329.00 16065.00
15886.00 15131.00 15954.00
15836.00 15084.00 15924.00
15821.00 15069.00 15948.00
15732.00 14985.00 15785.00
15715.00 14968.00 15725.00
15718.00 14971.00 15633.00
15974.00 15215.00 15811.00
16059.00 15296.00 15893.00
15977.00 15218.00 15814.00
15991.00 15232.00 15828.00
15900.00 15145.00 15606.00
15973.00 15214.00 15611.00
15964.00 15205.00 15439.00
16299.00 15525.00 15703.00
16446.00 15664.00 15816.00
16723.00 15929.00 16009.00
16723.00 15929.00 15916.00
16583.00 15795.00 15450.00
16346.00 15569.00 14966.00
16799.00 16001.00 15291.00
17375.00 16549.00 16203.00
17521.00 16689.00 16459.00
17430.00 16602.00 16241.00
17388.00 16562.00 16064.00
17501.00 16670.00 16373.00
17347.00 16523.00 16035.00
17557.00 16723.00 16284.00
17785.00 16940.00 16442.00
17090.00 16278.00 15388.00
17676.00 16836.00 15840.00
18139.00 17277.00 16355.00
17914.00 17063.00 16239.00
18021.00 17165.00 16330.00
17857.00 17009.00 16173.00
18025.00 17169.00 16558.00
18110.00 17250.00 16821.00
18074.00 17215.00 16731.00
17615.00 16778.00 15541.00
17322.00 16499.00 14923.00
17591.00 16755.00 15296.00
17522.00 16690.00 15051.00
17499.00 16668.00 14924.00
17993.00 17138.00 15814.00
18112.00 17251.00 16054.00
18269.00 17401.00 16517.00
18414.00 17539.00 16730.00
18730.00 17841.00 17163.00
19155.00 18246.00 18128.00
19171.00 18260.00 18323.00
19405.00 18483.00 18824.00
19036.00 18132.00 18554.00
19163.00 18253.00 18798.00
19579.00 18649.00 19299.00
19799.00 18858.00 19693.00
19919.00 18973.00 19965.00
20135.00 19178.00 20428.00
20328.00 19362.00 20747.00
20405.00 19436.00 20738.00
20581.00 19603.00 20884.00
20399.00 19430.00 20733.00
20000.00 19050.00 20402.00
20174.00 19215.00 20699.00
20492.00 19519.00 20983.00
08/2004 20872.00 19885.00 21362.00
The graph and table do not reflect the deduction of taxes that a shareholder
would pay on fund distributions or the redemption of fund shares. The Merrill
Lynch US High Yield, Cash Pay Only Index is an unmanaged index that tracks the
performance of non-investment-grade corporate bonds. Unlike mutual funds,
indices are not investments, do not incur fees or expenses and are not
professionally managed. It is not possible to invest directly in an index.
Securities in the fund may not match those in an index.
AVERAGE ANNUAL TOTAL RETURN AS OF 08/31/04 (%)
SHARE CLASS A B C D Z
- -------------------------------------------------------------------------------------------------
INCEPTION 11/01/02 11/01/02 10/13/03 11/01/02 10/01/93
- -------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- -------------------------------------------------------------------------------------------------
1-year 8.90 3.76 8.07 3.07 8.14 7.14 8.23 6.11 9.16
- -------------------------------------------------------------------------------------------------
5-year 5.81 4.78 5.50 5.19 5.51 5.51 5.56 5.36 5.93
- -------------------------------------------------------------------------------------------------
10-year 7.64 7.12 7.47 7.47 7.48 7.48 7.51 7.40 7.69
AVERAGE ANNUAL TOTAL RETURN AS OF 06/30/04 (%)
SHARE CLASS A B C D Z
- -------------------------------------------------------------------------------------------------
SALES CHARGE WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
- -------------------------------------------------------------------------------------------------
1-year 3.96 -0.94 3.14 -1.74 3.18 2.20 3.31 1.29 4.20
- -------------------------------------------------------------------------------------------------
5-year 4.96 3.94 4.67 4.37 4.68 4.68 4.73 4.52 5.06
- -------------------------------------------------------------------------------------------------
10-year 7.40 6.89 7.26 7.26 7.26 7.26 7.29 7.18 7.46
THE "WITH SALES CHARGE" RETURNS INCLUDE THE MAXIMUM INITIAL SALES CHARGE OF
4.75% FOR CLASS A SHARES AND 1% FOR CLASS D SHARES, MAXIMUM CONTINGENT DEFERRED
SALES CHARGE OF 5.00% FOR CLASS B SHARES AND 1.00% FOR CLASS C AND D SHARES FOR
THE FIRST YEAR ONLY.
ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS. CLASS Z SHARES ARE SOLD
AT NET ASSET VALUE WITH NO RULE 12B-1 FEES. PERFORMANCE FOR DIFFERENT SHARE
CLASSES WILL VARY BASED ON DIFFERENCES IN SALES CHARGES AND FEES ASSOCIATED WITH
EACH CLASS.
Effective October 13, 2003, class D shares were closed to all new investors and
new accounts. Existing class D shareholders will be able to make additional
purchases at any time. In addition, class D initial sales charge of 1.00% is
waived after October 13, 2003.
Performance results reflect any voluntary waivers or reimbursement of fund
expenses by the advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
Classes A, B, and D (newer class shares) share performance information includes
returns of the fund's class Z shares (the oldest existing fund class) for
periods prior to the inception of the newer class shares. The returns for class
C include the returns of class B prior to 10/13/03, the date on which class C
was initially offered by the fund. The returns shown for class C also include
the performance of class Z prior to the inception of class B (11/01/02). Class Z
share returns are not restated to reflect any expense differential (e.g., Rule
12b-1 fees) between class Z shares and the newer class shares. Had the expense
differential been reflected, the returns for the periods prior to the inception
of classes A, B, C and D would have been lower.
54
[Sidebar]
ESTIMATING YOUR ACTUAL EXPENSES
To estimate the expenses that you paid over the period, first you will need your
account balance at the end of the period:
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS
SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT
WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE
FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE
1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT
BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6
2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD,"
LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE
COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1.
YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING
THE PERIOD
UNDERSTANDING YOUR EXPENSES ____________________________________________________
COLUMBIA HIGH YIELD FUND
As a fund shareholder, you incur two types of costs. There are transaction
costs, which generally include sales charges on purchases and may include
redemption or exchange fees. There are also ongoing costs, which generally
include investment advisory fees, and/or Rule 12b-1 fees, and other fund
expenses. The information on this page is intended to help you understand your
ongoing costs of investing in the fund and to compare these costs with the
ongoing costs of investing in other mutual funds.
ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS
To illustrate these ongoing costs, we have provided an example and calculated
the expenses paid by investors in each share class during the reporting period.
The information in the following table is based on an initial investment of
$1,000, which is invested at the beginning of the reporting period and held for
the entire period. Expense information is calculated two ways and each method
provides you with different information. The amount listed in the "actual"
column is calculated using the fund's actual operating expenses and total return
for the period. The amount listed in the "hypothetical" column for each share
class assumes that the return each year is 5% before expenses and includes the
fund's actual expense ratio. You should not use the hypothetical account values
and expenses to estimate either your actual account balance at the end of the
period or the expenses you paid during this reporting period.
MARCH 1, 2004 - AUGUST 31, 2004
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED
BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%)
- -----------------------------------------------------------------------------------------------------------
ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL
- -----------------------------------------------------------------------------------------------------------
Class A 1,000.00 1,000.00 1,023.43 1,020.01 5.19 5.18 1.02
- -----------------------------------------------------------------------------------------------------------
Class B 1,000.00 1,000.00 1,020.26 1,016.24 8.99 8.97 1.77
- -----------------------------------------------------------------------------------------------------------
Class C 1,000.00 1,000.00 1,021.01 1,016.99 8.23 8.21 1.62
- -----------------------------------------------------------------------------------------------------------
Class D 1,000.00 1,000.00 1,020.61 1,016.99 8.23 8.21 1.62
- -----------------------------------------------------------------------------------------------------------
Class Z 1,000.00 1,000.00 1,024.73 1,021.27 3.92 3.91 0.77
Expenses paid during the period are equal to the fund's annualized expense
ratio, multiplied by the average account value over the period, then multiplied
by the number of days in the fund's most recent fiscal half-year and divided by
366.
Had the Fund's Distributor not waived a portion of expenses for class C and
class D, total return would have been reduced.
It is important to note that the expense amounts shown in the table are meant to
highlight only ongoing costs of investing in the fund and do not reflect any
transactional costs, such as sales charges, redemption or exchange fees.
Therefore, the hypothetical examples provided may not help you determine the
relative total costs of owning different funds. If these transactional costs
were included, your costs would have been higher.
COMPARE WITH OTHER FUNDS
Since all mutual fund companies are required to include the same hypothetical
calculations about expenses in shareholder reports, you can use this information
to compare the ongoing cost of investing in the fund with other funds. To do so,
compare the 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of other funds. As you compare hypothetical
examples of other funds, it is important to note that hypothetical examples are
meant to highlight the continuing cost of investing in a fund and do not reflect
any transactional costs, such as sales charges or redemption or exchange fees.
55
[Sidebar]
SUMMARY
o FOR THE 12-MONTH PERIOD ENDED AUGUST 31, 2004, THE FUND'S CLASS A SHARES
RETURNED 8.90% WITHOUT SALES CHARGE.
o THE FUND'S SOLID RETURN REFLECTS A STRONG ENVIRONMENT FOR THE HIGH YIELD
MARKET. HOWEVER, IT TRAILED ITS BENCHMARK, THE MERRILL LYNCH US HIGH YIELD,
CASH PAY ONLY INDEX, BECAUSE IT DID NOT OWN LOWER QUALITY SECURITIES, WHICH
DID ESPECIALLY WELL LATE IN 2003.
o AS THE PERIOD WORE ON, THE PERFORMANCE GAP BETWEEN HIGHER AND LOWER QUALITY
SECURITIES NARROWED AND THE FUND'S RELATIVE PERFORMANCE IMPROVED.
[Illustration of two arrows pointing up]
MERRILL LYNCH US
HIGH YIELD, CASH
CLASS A SHARES PAY ONLY INDEX
8.90% 13.64%
OBJECTIVE
Seeks a high level of income,
with capital appreciation as a
secondary goal, by investing in
non-investment-grade,
corporate debt securities.
TOTAL NET ASSETS
$1,731.3 million
NET ASSET VALUE PER SHARE
AS OF 08/31/04 ($)
Class A 8.69
------------------------------------------
Class B 8.69
------------------------------------------
Class C 8.69
------------------------------------------
Class D 8.69
------------------------------------------
Class Z 8.69
DISTRIBUTIONS DECLARED PER SHARE
09/01/03 - 08/31/04 ($)
Class A 0.54
------------------------------------------
Class B 0.47
------------------------------------------
Class C 0.43
------------------------------------------
Class D 0.48
------------------------------------------
Class Z 0.56
PORTFOLIO MANAGERS' REPORT _____________________________________________________
COLUMBIA HIGH YIELD FUND
For the 12-month period ended August 31, 2004, Columbia High Yield Fund class A
shares returned 8.90% without sales charge. The fund lagged the Merrill Lynch US
High Yield, Cash Pay Only Index, which returned 13.64%. The fund's performance
was held back because it did not own lower quality securities, which did
especially well during the later months of 2003. However, as the period wore on,
the performance gap between higher and lower quality securities narrowed, and
the fund's relative performance improved.
A RISK-TAKER'S MARKET
As the economic recovery unfolded in 2003, fixed-income investors became
increasingly willing to assume the risks of lower quality securities in return
for their substantially higher yields. The market's preference for low quality
securities created a striking performance gap: BB-rated securities returned 9.9%
during the first six months of the reporting period, while CCC-rated issues did
far better, returning 14.5%. The fund's strategy to generally not own CCC-rated
bonds, which carry above-average bankruptcy risk, placed it at a disadvantage.
However, CCC-rated securities lost ground in the second half of the period.
ALLOCATION DECISIONS GENERALLY HELPED PERFORMANCE
In general, the fund's returns were aided by favorable sector allocation
decisions. In part, the fund benefited because of what it DIDN'T own. For
example, the fund had no exposure to the airline sector, which suffered from
increased competition and higher fuel prices. The fund also had minimal exposure
to the telecommunications sector, an industry in which many companies continued
to struggle. The fund's only holding in this sector, Nextel Communications,
improved its competitive standing during the year and was a positive performer
for the fund. Cable television holdings also made a positive contribution to
performance. Satellite companies continued to take market share from traditional
cable companies, a trend that favored fund holdings such as DirecTV Holdings and
EchoStar DBS.
However, not all our allocation decisions worked out well. We had no exposure to
the electric utility industry, which returned 16.1% over the past 12 months.
QUALITY BIAS IN ENERGY DETRACTED FROM PERFORMANCE
Our preference for quality in security selection also hurt performance. This was
especially evident within the energy sector, the fund's largest industry
position. Energy companies benefited from the steady increase in oil prices
during the period. But the best performers were companies such as CCC-rated El
Paso, which the fund does not own, and B-rated Williams Companies, which the
fund recently purchased.
56
[Sidebar]
PORTFOLIO QUALITY AS OF 08/31/04 (%)
Baa 1.2
------------------------------------------
Ba 61.9
------------------------------------------
B 36.9
Portfolio quality is calculated as a percentage of total investments.
Ratings shown represent the highest rating assigned to a particular bond by one
of the nationally recognized rating agencies: Standard and Poor's Corporation,
Moody's Investors Service, Inc. or Fitch Ratings Ltd.
TOP 5 SECTORS AS OF 08/31/04 (%)
Energy 10.9
------------------------------------------
Health care 8.1
------------------------------------------
Casinos & gaming 8.1
------------------------------------------
Cable TV 5.5
------------------------------------------
Services 5.1
HOLDINGS DISCUSSED IN THIS REPORT
AS OF 08/31/04 (%)
Nextel Communications 2.0
------------------------------------------
Directv Holdings 1.6
------------------------------------------
EchoStar DBS 2.0
------------------------------------------
Williams Companies 0.9
------------------------------------------
Fisher Scientific International 0.2
------------------------------------------
Royal Caribbean Cruises 2.1
MATURITY BREAKDOWN AS OF 08/31/04 (%)
0-3 years 7.0
------------------------------------------
3-5 years 12.4
------------------------------------------
5-10 years 76.5
------------------------------------------
10+ years 4.1
Your fund is actively managed and the composition of its portfolio will change
over time. Portfolio composition and holdings discussed are calculated as a
percentage of net assets.
________________________________________________________________________________
COLUMBIA HIGH YIELD FUND
BUYOUTS AND UPGRADES, PURCHASES AND SALES
Several holdings were bought out or upgraded by rating agencies during the
period--both positive factors for the fund. Among our health care holdings,
Apogent Technology was bought by Fisher Scientific International. Its bonds
moved up sharply as a result. Within the automotive sector, American Axle &
Manufacturing and Lear were upgraded to investment-grade status. During the
period, Lear's bonds were sold and American Axle's bonds were called. We also
eliminated positions in Abitibi Consolidated and Cascades, two forest products
companies whose fundamentals didn't show the improvement we had anticipated.
We made several new purchases for the fund. We initiated a sizable position in
cruise operator Royal Caribbean Cruises, which recently completed a major
program to augment its fleet. With capital spending now sharply down and the
travel business showing increased strength, the company offers an attractive
risk/reward profile.
SOLID PROSPECTS GOING FORWARD
Overall, the fundamentals of the high-yield bond market remain attractive.
Default rates have continued to move down. Even if interest rates tick higher,
we believe the high-yield market is capable of holding its ground. High-yield
securities have historically outperformed investment-grade securities when
interest rates have risen.
[PHOTO OF Jeffrey L. Rippey] Jeffrey L. Rippey, CFA, has managed or co-managed
Columbia High Yield Fund since its inception in
October 1993 and has been with the advisor and its
predecessors since 1981.
/s/ Jeffrey L. Rippey
[PHOTO OF Kurt M. Havnaer] Kurt M. Havnaer, CFA, has co-managed the fund
since February 2000. Mr. Havnaer was on a leave of
absence for the period March 2004 to April 2004.
He has been associated with Columbia Management or
its predecessors since 1996.
/s/ Kurt M. Havnaer
Investing in high-yield securities (commonly known as "junk bonds") offers the
potential for high current income and attractive total return, but involves
certain risks. Changes in economic conditions or other circumstances may
adversely affect a junk bond issuer's ability to make timely principal and
interest payments. Rising interest rates tend to lower the value of all bonds.
Investing in junk bonds of foreign and emerging markets includes additional risk
such as currency exchange rate fluctuations and economic and political change.
57
[Sidebar]
PERFORMANCE OF A $10,000 INVESTMENT
09/01/94 - 08/31/04 ($)
SALES CHARGE WITHOUT
------------------------------------------
Class Z 14,570
Performance data quoted represents past performance and current performance may
be lower or higher. Past performance is no guarantee of future results. The
investment return will fluctuate so that shares may be worth more or less than
the original cost. Please visit www.columbiafunds.com for daily and most recent
month-end performance updates.
PERFORMANCE INFORMATION ________________________________________________________
COLUMBIA DAILY INCOME COMPANY
VALUE OF A $10,000 INVESTMENT 09/01/94 - 08/31/04
[MOUNTAIN CHART]
LIPPER MONEY
MARKET FUNDS
CATEGORY
AVERAGE CLASS Z SHARES
-------------- ------------
09/1994 10000.00 10000.00
10033.00 10034.00
10069.00 10071.00
10106.00 10109.00
10150.00 10153.00
10193.00 10199.00
10235.00 10241.00
10282.00 10290.00
10328.00 10337.00
10375.00 10385.00
10421.00 10432.00
10467.00 10480.00
10512.00 10527.00
10556.00 10573.00
10601.00 10619.00
10645.00 10665.00
10689.00 10712.00
10734.00 10758.00
10774.00 10800.00
10816.00 10843.00
10857.00 10885.00
10899.00 10929.00
10940.00 10971.00
10983.00 11016.00
11027.00 11062.00
11069.00 11106.00
11114.00 11151.00
11156.00 11196.00
11200.00 11242.00
11245.00 11288.00
11285.00 11330.00
11329.00 11376.00
11373.00 11422.00
11419.00 11470.00
11465.00 11518.00
11512.00 11567.00
11559.00 11617.00
11604.00 11665.00
11652.00 11715.00
11699.00 11764.00
11748.00 11816.00
11797.00 11868.00
11841.00 11914.00
11889.00 11964.00
11936.00 12013.00
11985.00 12064.00
12032.00 12113.00
12082.00 12165.00
12131.00 12217.00
12179.00 12269.00
12226.00 12320.00
12271.00 12368.00
12317.00 12418.00
12362.00 12466.00
12402.00 12509.00
12445.00 12555.00
12488.00 12600.00
12531.00 12647.00
12574.00 12692.00
12619.00 12740.00
12666.00 12790.00
12713.00 12840.00
12762.00 12893.00
12812.00 12946.00
12866.00 13004.00
12920.00 13064.00
12972.00 13118.00
13027.00 13179.00
13083.00 13238.00
13144.00 13303.00
13204.00 13368.00
13269.00 13438.00
13334.00 13508.00
13397.00 13575.00
13462.00 13646.00
13525.00 13714.00
13592.00 13784.00
13656.00 13853.00
13709.00 13910.00
13764.00 13968.00
13812.00 14020.00
13856.00 14067.00
13895.00 14111.00
13932.00 14152.00
13967.00 14190.00
13998.00 14224.00
14023.00 14253.00
14043.00 14275.00
14060.00 14295.00
14074.00 14313.00
14086.00 14327.00
14099.00 14343.00
14112.00 14357.00
14124.00 14371.00
14137.00 14386.00
14150.00 14400.00
14161.00 14414.00
14172.00 14427.00
14184.00 14440.00
14194.00 14452.00
14202.00 14464.00
14209.00 14472.00
14215.00 14479.00
14222.00 14487.00
14228.00 14494.00
14234.00 14503.00
14239.00 14510.00
14243.00 14516.00
14248.00 14522.00
14252.00 14526.00
14256.00 14530.00
14261.00 14535.00
14265.00 14539.00
14269.00 14542.00
14273.00 14546.00
14278.00 14551.00
14282.00 14553.00
14286.00 14556.00
14291.00 14561.00
14296.00 14567.00
08/2004 14303.00 14570.00
The graph and table do not reflect the deduction of taxes that a shareholder
would pay on fund distributions or the redemption of fund shares. An investment
in the fund is not insured or guaranteed by the Federal Deposit Insurance
Corporation or any other governmental agency. Although the fund seeks to
preserve the value of your investment at $1 per share, it is possible to lose
money by investing in the fund.
AVERAGE ANNUAL TOTAL RETURN AS OF 08/31/04 (%)
LIPPER MONEY MARKET
CLASS Z FUNDS CATEGORY AVERAGE
- ------------------------------------------------
1-year 0.36 0.38
- ------------------------------------------------
5-year 2.64 2.49
- ------------------------------------------------
10-year 3.84 3.76
AVERAGE ANNUAL TOTAL RETURN AS OF 06/30/04 (%)
LIPPER MONEY MARKET
CLASS Z FUNDS CATEGORY AVERAGE
- -------------------------------------------------
1-year 0.35 0.36
- -------------------------------------------------
5-year 2.78 2.62
- -------------------------------------------------
10-year 3.90 3.81
ALL RESULTS SHOWN ASSUME REINVESTMENT OF DISTRIBUTIONS. CLASS Z SHARES ARE SOLD
AT NET ASSET VALUE WITH NO RULE 12B-1 FEES.
Performance results reflect any voluntary waivers or reimbursement of fund
expenses by the advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
58
[Sidebar]
ESTIMATING YOUR ACTUAL EXPENSES
To estimate the expenses that you paid over the period, first you will need your
account balance at the end of the period:
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM COLUMBIA FUNDS
SERVICES, INC., YOUR ACCOUNT BALANCE IS AVAILABLE ONLINE AT
WWW.COLUMBIAFUNDS.COM OR BY CALLING SHAREHOLDER SERVICES AT 800.345.6611
o FOR SHAREHOLDERS WHO RECEIVE THEIR ACCOUNT STATEMENTS FROM THEIR BROKERAGE
FIRM, CONTACT YOUR BROKERAGE FIRM TO OBTAIN YOUR ACCOUNT BALANCE
1. DIVIDE YOUR ENDING ACCOUNT BALANCE BY $1,000. FOR EXAMPLE, IF AN ACCOUNT
BALANCE WAS $8,600 AT THE END OF THE PERIOD, THE RESULT WOULD BE 8.6
2. IN THE SECTION OF THE TABLE BELOW TITLED "EXPENSES PAID DURING THE PERIOD,"
LOCATE THE AMOUNT FOR YOUR SHARE CLASS. YOU WILL FIND THIS NUMBER IS IN THE
COLUMN LABELED "ACTUAL." MULTIPLY THIS NUMBER BY THE RESULT FROM STEP 1.
YOUR ANSWER IS AN ESTIMATE OF THE EXPENSES YOU PAID ON YOUR ACCOUNT DURING
THE PERIOD
UNDERSTANDING YOUR EXPENSES ____________________________________________________
COLUMBIA DAILY INCOME COMPANY
As a fund shareholder, you incur two types of costs. There are transaction
costs, which generally include sales charges on purchases and may include
redemption or exchange fees. There are also ongoing costs, which generally
include investment advisory fees and other fund expenses. The information on
this page is intended to help you understand your ongoing costs of investing in
the fund and to compare these costs with the ongoing costs of investing in other
mutual funds.
ANALYZING YOUR FUND'S EXPENSES BY SHARE CLASS
To illustrate these ongoing costs, we have provided an example and calculated
the expenses paid by investors in each share class during the reporting period.
The information in the following table is based on an initial investment of
$1,000, which is invested at the beginning of the reporting period and held for
the entire period. Expense information is calculated two ways and each method
provides you with different information. The amount listed in the "actual"
column is calculated using the fund's actual operating expenses and total return
for the period. The amount listed in the "hypothetical" column for each share
class assumes that the return each year is 5% before expenses and includes the
fund's actual expense ratio. You should not use the hypothetical account values
and expenses to estimate either your actual account balance at the end of the
period or the expenses you paid during this reporting period.
MARCH 1, 2004 - AUGUST 31, 2004
ACCOUNT VALUE AT THE ACCOUNT VALUE AT THE EXPENSES PAID FUND'S ANNUALIZED
BEGINNING OF THE PERIOD ($) END OF THE PERIOD ($) DURING THE PERIOD ($) EXPENSE RATIO (%)
- -----------------------------------------------------------------------------------------------------------
ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL ACTUAL HYPOTHETICAL
- -----------------------------------------------------------------------------------------------------------
Class Z 1,000.00 1,000.00 1,001.76 1,021.57 3.57 3.61 0.71
Expenses paid during the period are equal to the fund's annualized expense
ratio, multiplied by the average account value over the period, then multiplied
by the number of days in the fund's most recent fiscal half-year and divided by
366.
It is important to note that the expense amounts shown in the table are meant to
highlight only ongoing costs of investing in the fund and do not reflect any
transactional costs, such as sales charges, redemption or exchange fees.
Therefore, the hypothetical examples provided may not help you determine the
relative total costs of owning different funds. If these transactional costs
were included, your costs would have been higher.
COMPARE WITH OTHER FUNDS
Since all mutual fund companies are required to include the same hypothetical
calculations about expenses in shareholder reports, you can use this information
to compare the ongoing cost of investing in the fund with other funds. To do so,
compare the 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of other funds. As you compare hypothetical
examples of other funds, it is important to note that hypothetical examples are
meant to highlight the continuing cost of investing in a fund and do not reflect
any transactional costs, such as sales charges or redemption or exchange fees.
59
[Sidebar]
SUMMARY
o FOR THE 12-MONTH PERIOD THAT ENDED AUGUST 31, 2004, THE FUND'S CLASS Z
SHARES RETURNED 0.36% AS THE LOWEST INTEREST RATES IN 40 YEARS PREVAILED.
o THE FUND'S RETURN WAS IN LINE WITH THE LIPPER MONEY MARKET FUNDS CATEGORY
AVERAGE OF 0.38%.
o SHORT-TERM RATES MOVED HIGHER TOWARD THE END OF THE PERIOD, BUT IT WILL TAKE
SOME TIME FOR THE INCREASE TO BE FULLY REFLECTED IN MONEY MARKET RETURNS.
[Illustration of two arrows pointing up]
LIPPER MONEY
MARKET FUNDS
CLASS Z SHARES CATEGORY AVERAGE
0.36% 0.38%
OBJECTIVE
Seeks a high level of
income consistent with the
maintenance of liquidity and
the preservation of capital
by investing primarily in high
quality money market securities
TOTAL NET ASSETS
$ 661.1 million
NET ASSET VALUE PER SHARE
AS OF 08/31/04 ($)
Class Z 1.00
PORTFOLIO MANAGER'S REPORT _____________________________________________________
COLUMBIA DAILY INCOME COMPANY
For the 12-month period ended August 31, 2004, Columbia Daily Income Company
class Z shares returned 0.36%. This return was in line with the Lipper Money
Market Funds Category average, which averaged a gain of 0.38% for the period. 1
Returns on money-market funds remained low because the yields on short-term
fixed-income securities were at a 40-year historical low throughout the
twelve-month period.
RATES LOW BUT TRENDING HIGHER
For most of the 12-month reporting period, the Federal Reserve kept short-term
interest rates low in an effort to stimulate economic growth. Low interest rates
were intended as a temporary economic stimulus with the expectation that the Fed
would raise short-term interest rates when the economy posted respectable
growth. Unusually low rates can create a negative real rate of return, which
occurs when short-term rates are lower than the prevailing inflation rate, which
can result in a loss of purchasing power over time. Although there were doubts
about the sustainability of economic growth early in 2004, it quickly dissipated
on strong employment news in the second quarter. On June 30th, policymakers
raised a key short-term interest rate, the federal funds rate, from 1.00% to
1.25% and to 1.50% when they met in August. 2
POSITIONING THE FUND WITHIN A CHANGING MARKET
During the period, we maintained a lower average time to maturity in order to
make it easier to invest at higher rates when rates rose. At the end of August,
the fund's weighted average maturity was 35 days, somewhat toward the lower end
of our normal range of 30 to 50 days.
Although the fund has maintained a higher-than-average weight in US Treasury
securities over the past several years, its investments are currently divided
between agency discount notes and A1/P1-rated commercial paper, with no exposure
to US Treasuries. We are comfortable with the portfolio's positioning, because
the credit environment has improved after a two-year period during which the
credit quality of certain corporate issuers was questioned. The current
positioning offers the opportunity for higher yields.
1 Lipper Inc., a widely respected data provider in the industry, calculates an
average total return for mutual funds with similar investment objectives as
those of the fund.
2 In September, the federal funds rate was raised to 1.75%.
60
[Sidebar]
PORTFOLIO HIGHLIGHTS AS OF 08/31/04
Seven day current yield 0.58%
-------------------------------------------------
Seven day effective yield 0.58%
-------------------------------------------------
Average days to maturity 35
________________________________________________________________________________
COLUMBIA DAILY INCOME COMPANY
AN IMPROVING OUTLOOK
As securities in the portfolio mature, we plan to reinvest at new, higher rates
and eventually those higher rates should be reflected in higher returns for the
fund. We expect the Federal Reserve to make good on its word to continue raising
rates at a measured pace. The consensus of the market is that the fed funds rate
will rise to 2% early in 2005 en route to a more sustainable level of under 3%.
The current level of economic growth, while not spectacular, appears solid
enough to justify such advances, which could bring money market rates above the
inflation rate for the first time in several years.
Leonard Aplet has managed the fund since 1988
and has been with the advisor and its
predecessors since 1987.
/s/ Leonard Aplet
Effective October 7, 2004 Karen M. Arneil and William A. Goldthwait began
co-managing Columbia Daily Income Fund, replacing Leonard Aplet. Ms. Arneil is a
Senior Vice President and has been associated with the advisor and its
predecessors since 1996. Mr. Goldthwait is a Senior Vice President and has been
associated with the advisor and its predecessors since 1997.
There is a chance that the fund's investments may not keep pace with the rate of
inflation over the long-term. Also, an investment in the fund is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other
governmental agency. Although the fund seeks to preserve the value of your
investment at $1 per share, it is possible to lose money by investing in the
fund.
61
FINANCIAL STATEMENTS ___________________________________________________________
COLUMBIA FUNDS
AUGUST 31, 2004
A GUIDE TO UNDERSTANDING YOUR FUND'S
FINANCIAL STATEMENTS
--------------------------------------------
INVESTMENT PORTFOLIO The investment portfolio details all of the
fund's holdings and their market value as of
the last day of the reporting period.
Portfolio holdings are organized by type of
asset, industry, country or geographic
region (if applicable) to demonstrate areas
of concentration and diversification.
--------------------------------------------
STATEMENT OF ASSETS AND This statement details the fund's assets,
LIABILITIES liabilities, net assets and share price for
each share class as of the last day of the
reporting period. Net assets are calculated
by subtracting all the fund's liabilities
(including any unpaid expenses) from the
total of the fund's investment and
non-investment assets. The share price for
each class is calculated by dividing net
assets for that class by the number of
shares outstanding in that class as of the
last day of the reporting period.
--------------------------------------------
STATEMENT OF OPERATIONS This statement details income earned by the
fund and the expenses accrued by the fund
during the reporting period. The Statement
of Operations also shows any net gain or
loss the fund realized on the sales of its
holdings during the period, as well as any
unrealized gains or losses recognized over
the period. The total of these results
represents the fund's net increase or
decrease in net assets from operations.
--------------------------------------------
STATEMENT OF CHANGES IN NET This statement demonstrates how the fund's
ASSETS net assets were affected by its operating
results, distributions to shareholders and
shareholder transactions (e.g.,
subscriptions, redemptions and dividend
reinvestments) during the reporting period.
The Statement of Changes in Net Assets also
details changes in the number of shares
outstanding.
--------------------------------------------
NOTES TO FINANCIAL These notes disclose the organizational
STATEMENTS background of the fund, its significant
accounting policies (including those
surrounding security valuation, income
recognition and distributions to
shareholders), federal tax information, fees
and compensation paid to affiliates and
significant risks and contingencies.
--------------------------------------------
FINANCIAL HIGHLIGHTS The financial highlights demonstrate how
the fund's net asset value per share was
affected by the fund's operating results.
The financial highlights table also
discloses the classes' performance and
certain key ratios (e.g., class expenses
and net investment income as a percentage
of average net assets).
62
This page intentionally left blank.
INVESTMENT PORTFOLIO ___________________________________________________________
AUGUST 31, 2004 COLUMBIA COMMON STOCK FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - 97.6%
CONSUMER DISCRETIONARY - 17.2%
HOTELS, RESTAURANTS & LEISURE - 1.3%
Darden Restaurants, Inc. 190,300 3,998,203
-------------
Hotels, Restaurants & Leisure Total 3,998,203
HOUSEHOLD DURABLES - 1.2%
Garmin Ltd. 95,400 3,712,014
-------------
Household Durables Total 3,712,014
LEISURE EQUIPMENT & PRODUCTS - 0.6%
Hasbro, Inc. 100,400 1,860,412
-------------
Leisure Equipment & Products Total 1,860,412
MEDIA - 7.8%
Comcast Corp., Class A (a) 194,442 5,477,431
DirecTV Group, Inc. (a) 382,800 6,075,036
Liberty Media Corp., Series A (a) 567,200 5,053,752
Liberty Media International, Inc.,
Series A (a) 31,433 1,062,435
Time Warner, Inc. (a) 370,400 6,056,040
-------------
Media Total 23,724,694
MULTILINE RETAIL - 3.5%
Kohl's Corp. (a) 117,800 5,828,744
Sears, Roebuck and Co. 125,500 4,804,140
-------------
Multiline Retail Total 10,632,884
SPECIALTY RETAIL - 1.3%
RadioShack Corp. 151,000 4,067,940
-------------
Specialty Retail Total 4,067,940
TEXTILES, APPAREL & LUXURY GOODS - 1.5%
Liz Claiborne, Inc. 122,400 4,659,768
-------------
Textiles, Apparel & Luxury Goods Total 4,659,768
-------------
CONSUMER DISCRETIONARY TOTAL 52,655,915
CONSUMER STAPLES - 5.6%
BEVERAGES - 0.8%
Coca-Cola Femsa, SA de CV, ADR 115,100 2,345,738
-------------
Beverages Total 2,345,738
FOOD & STAPLES RETAILING - 1.6%
Safeway, Inc. (a) 245,700 4,963,140
-------------
Food & Staples Retailing Total 4,963,140
FOOD PRODUCTS - 1.3%
Sara Lee Corp. 182,700 4,043,151
-------------
Food Products Total 4,043,151
TOBACCO - 1.9%
Altria Group, Inc. 118,165 5,784,177
-------------
Tobacco Total 5,784,177
-------------
CONSUMER STAPLES TOTAL 17,136,206
SHARES VALUE ($)
------------ -------------
ENERGY - 7.4%
ENERGY EQUIPMENT & SERVICES - 0.6%
Transocean, Inc. (a) 60,600 1,860,420
-------------
Energy Equipment & Services Total 1,860,420
OIL & GAS - 6.8%
Anadarko Petroleum Corp. 39,800 2,356,956
BP PLC, ADR 30,000 1,611,000
Devon Energy Corp. 45,600 2,955,336
El Paso Corp. 326,000 2,666,680
Kerr-McGee Corp. 107,900 5,694,962
Noble Energy, Inc. 34,800 1,791,504
Unocal Corp. 98,200 3,666,788
-------------
Oil & Gas Total 20,743,226
-------------
ENERGY TOTAL 22,603,646
FINANCIALS - 20.0%
CAPITAL MARKETS - 2.2%
A.G. Edwards, Inc. 49,600 1,725,088
Morgan Stanley 96,000 4,870,080
-------------
Capital Markets Total 6,595,168
COMMERCIAL BANKS - 1.0%
Fifth Third Bancorp 63,900 3,182,859
-------------
Commercial Banks Total 3,182,859
CONSUMER FINANCE - 1.0%
American Express Co. 62,550 3,128,751
-------------
Consumer Finance Total 3,128,751
DIVERSIFIED FINANCIAL SERVICES - 5.5%
Citigroup, Inc. 159,689 7,438,314
E*TRADE Financial Corp. (a) 146,400 1,724,592
JPMorgan Chase & Co. 191,012 7,560,255
-------------
Diversified Financial Services Total 16,723,161
INSURANCE - 5.5%
ACE Ltd. 115,900 4,467,945
Allstate Corp. 39,400 1,860,074
Chubb Corp. 37,300 2,536,773
Marsh & McLennan Companies, Inc. 55,600 2,484,764
UnumProvident Corp. 338,500 5,476,930
-------------
Insurance Total 16,826,486
THRIFTS & MORTGAGE FINANCE - 4.8%
Fannie Mae 84,765 6,310,754
MGIC Investment Corp. 123,000 8,397,210
-------------
Thrifts & Mortgage Finance Total 14,707,964
-------------
FINANCIALS TOTAL 61,164,389
HEALTH CARE - 14.6%
BIOTECHNOLOGY - 3.4%
Amgen, Inc. (a) 94,882 5,625,554
MedImmune, Inc. (a) 197,000 4,702,390
-------------
Biotechnology Total 10,327,944
See Accompanying Notes to Financial Statements.
64
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA COMMON STOCK FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - (CONTINUED)
HEALTH CARE - (CONTINUED)
HEALTH CARE PROVIDERS & SERVICES - 4.8%
Cardinal Health, Inc. 121,400 5,487,280
McKesson Corp. 120,780 3,738,141
WebMD Corp. (a) 748,200 5,446,896
-------------
Health Care Providers & Services Total 14,672,317
PHARMACEUTICALS - 6.4%
Barr Pharmaceuticals, Inc. (a) 141,100 5,540,997
Biovail Corp. (a) 258,660 3,921,286
Endo Pharmaceuticals Holdings, Inc. (a) 61,900 1,049,824
Johnson & Johnson 54,225 3,150,472
Pfizer, Inc. 188,504 6,158,426
-------------
Pharmaceuticals Total 19,821,005
-------------
HEALTH CARE TOTAL 44,821,266
INDUSTRIALS - 3.0%
AIRLINES - 1.5%
Southwest Airlines Co. 306,700 4,545,294
-------------
Airlines Total 4,545,294
COMMERCIAL SERVICES & SUPPLIES - 1.5%
ServiceMaster Co. 132,100 1,642,003
Waste Management, Inc. 110,075 3,058,984
-------------
Commercial Services & Supplies Total 4,700,987
-------------
INDUSTRIALS TOTAL 9,246,281
INFORMATION TECHNOLOGY - 17.2%
COMMUNICATIONS EQUIPMENT - 3.3%
Cisco Systems, Inc. (a) 162,890 3,055,816
Nortel Networks Corp. (a) 981,900 3,691,944
UTStarcom, Inc. (a) 209,800 3,245,606
-------------
Communications Equipment Total 9,993,366
COMPUTERS & PERIPHERALS - 4.8%
Hewlett-Packard Co. 247,200 4,422,408
International Business Machines Corp. 65,725 5,566,250
SanDisk Corp. (a) 204,750 4,780,913
-------------
Computers & Peripherals Total 14,769,571
INTERNET SOFTWARE & SERVICES - 1.0%
IAC/InterActiveCorp (a) 137,400 3,134,094
-------------
Internet Software & Services Total 3,134,094
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 2.1%
Linear Technology Corp. 131,000 4,685,870
NVIDIA Corp. (a) 144,450 1,799,847
-------------
Semiconductors & Semiconductor
Equipment Total 6,485,717
SOFTWARE - 6.0%
Fair Isaac Corp. 48,100 1,295,333
Microsoft Corp. 422,200 11,526,060
SHARES VALUE ($)
------------ -------------
Oracle Corp. (a) 302,820 3,019,115
Synopsys, Inc. (a) 163,800 2,614,248
-------------
Software Total 18,454,756
-------------
INFORMATION TECHNOLOGY TOTAL 52,837,504
MATERIALS - 5.5%
CHEMICALS - 1.3%
E.I. du Pont de Nemours & Co. 95,500 4,035,830
-------------
Chemicals Total 4,035,830
CONTAINERS & PACKAGING - 3.1%
Sealed Air Corp. (a) 88,800 4,361,856
Smurfit-Stone Container Corp. (a) 287,400 5,098,476
-------------
Containers & Packaging Total 9,460,332
METALS & MINING - 1.1%
International Steel Group, Inc. (a) 113,200 3,441,280
-------------
Metals & Mining Total 3,441,280
-------------
MATERIALS TOTAL 16,937,442
TELECOMMUNICATION SERVICES - 7.1%
DIVERSIFIED TELECOMMUNICATION SERVICES - 5.0%
Brasil Telecom Participacoes SA 119,400 3,896,022
CenturyTel, Inc. 57,900 1,863,801
Qwest Communications
International, Inc. (a) 421,000 1,216,690
Telefonos de Mexico SA de CV, ADR 186,200 6,031,018
Verizon Communications, Inc. 59,500 2,335,375
-------------
Diversified Telecommunication Services Total 15,342,906
WIRELESS TELECOMMUNICATION SERVICES - 2.1%
AT&T Wireless Services, Inc. (a) 262,700 3,840,674
Nextel Communications, Inc.,
Class A (a) 114,300 2,650,617
-------------
Wireless Telecommunication Services Total 6,491,291
-------------
TELECOMMUNICATION SERVICES TOTAL 21,834,197
TOTAL COMMON STOCKS
(Cost of $277,783,745) 299,236,846
PREFERRED STOCK - 0.4%
CONSUMER DISCRETIONARY - 0.4%
MEDIA - 0.4%
News Corp., Ltd., ADR 42,850 1,274,788
-------------
Media Total 1,274,788
-------------
CONSUMER DISCRETIONARY TOTAL 1,274,788
Total Preferred Stock
(Cost of $1,370,889) 1,274,788
See Accompanying Notes to Financial Statements.
65
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA COMMON STOCK FUND
PAR ($) VALUE ($)
------------ -------------
SHORT-TERM OBLIGATION - 3.3%
Repurchase agreement with State Street
Bank & Trust Co., dated 08/31/04,
due 09/01/04 at 1.500%, collateralized
by a U.S. Treasury Bond maturing
11/15/10, market value $10,473,012
(repurchase proceeds $10,266,428) 10,266,000 10,266,000
-------------
TOTAL SHORT-TERM OBLIGATION
(cost of $10,266,000) 10,266,000
TOTAL INVESTMENTS - 101.3%
(COST OF $289,420,634) (b) 310,777,634
OTHER ASSETS & LIABILITIES, NET - (1.3)% (4,104,246)
NET ASSETS - 100.0% 306,673,388
NOTES TO INVESTMENT PORTFOLIO:
(a) Non-income producing security.
(b) Cost for federal income tax purposes is $290,604,004.
ACRONYM NAME
------- ----
ADR American Depositary Receipt
See Accompanying Notes to Financial Statements.
66
INVESTMENT PORTFOLIO ___________________________________________________________
AUGUST 31, 2004 COLUMBIA GROWTH FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - 98.1%
CONSUMER DISCRETIONARY - 13.9%
HOTELS, RESTAURANTS & LEISURE - 1.8%
Carnival Corp. 108,100 4,949,899
Marriott International, Inc., Class A 208,400 9,888,580
-------------
Hotels, Restaurants & Leisure Total 14,838,479
INTERNET & CATALOG RETAIL - 1.4%
eBay, Inc. (a) 134,600 11,648,284
-------------
Internet & Catalog Retail Total 11,648,284
MEDIA - 2.4%
Omnicom Group 93,400 6,426,854
Viacom, Inc., Class B 48,190 1,605,209
XM Satellite Radio Holdings, Inc.,
Class A (a) 402,300 11,051,181
-------------
Media Total 19,083,244
SPECIALTY RETAIL - 7.2%
Bed Bath & Beyond, Inc. (a) 209,960 7,856,703
Best Buy Co., Inc. 231,160 10,753,563
Chico's FAS, Inc. (a) 183,800 7,517,420
Home Depot, Inc. 144,900 5,297,544
Lowe's Companies, Inc. 276,980 13,765,906
Staples, Inc. 459,200 13,169,856
-------------
Specialty Retail Total 58,360,992
TEXTILES, APPAREL & LUXURY GOODS - 1.1%
Coach, Inc. (a) 208,100 8,771,415
-------------
Textiles, Apparel & Luxury Goods Total 8,771,415
-------------
CONSUMER DISCRETIONARY TOTAL 112,702,414
CONSUMER STAPLES - 11.2%
BEVERAGES - 1.8%
PepsiCo, Inc. 293,040 14,652,000
-------------
Beverages Total 14,652,000
FOOD & STAPLES RETAILING - 2.1%
Costco Wholesale Corp. 230,000 9,469,100
Sysco Corp. 239,010 7,681,782
-------------
Food & Staples Retailing Total 17,150,882
FOOD PRODUCTS - 1.3%
Bunge Ltd. 58,800 2,345,532
Hershey Foods Corp. 173,800 8,391,064
-------------
Food Products Total 10,736,596
HOUSEHOLD PRODUCTS - 1.6%
Procter & Gamble Co. 236,120 13,215,636
-------------
Household Products Total 13,215,636
SHARES VALUE ($)
------------ -------------
PERSONAL PRODUCTS - 3.2%
Alberto-Culver Co. 310,445 14,991,389
Avon Products, Inc. 239,500 10,581,110
-------------
Personal Products Total 25,572,499
TOBACCO - 1.2%
Altria Group, Inc. 197,700 9,677,415
-------------
Tobacco Total 9,677,415
-------------
CONSUMER STAPLES TOTAL 91,005,028
ENERGY - 0.8%
ENERGY EQUIPMENT & SERVICES - 0.3%
Smith International, Inc. (a) 43,400 2,472,932
-------------
Energy Equipment & Services Total 2,472,932
OIL & GAS - 0.5%
EOG Resources, Inc. 76,000 4,390,520
-------------
Oil & Gas Total 4,390,520
-------------
ENERGY TOTAL 6,863,452
FINANCIALS - 6.8%
CAPITAL MARKETS - 1.3%
Merrill Lynch & Co., Inc. 210,700 10,760,449
-------------
Capital Markets Total 10,760,449
CONSUMER FINANCE - 2.2%
American Express Co. 222,000 11,104,440
MBNA Corp. 286,500 6,916,110
-------------
Consumer Finance Total 18,020,550
DIVERSIFIED FINANCIAL SERVICES - 1.1%
Citigroup, Inc. 182,726 8,511,377
-------------
Diversified Financial Services Total 8,511,377
INSURANCE - 2.2%
American International Group, Inc. 124,200 8,848,008
Chubb Corp. 64,700 4,400,247
Progressive Corp. 52,400 4,207,720
-------------
Insurance Total 17,455,975
-------------
FINANCIALS TOTAL 54,748,351
HEALTH CARE - 21.7%
BIOTECHNOLOGY - 2.7%
Amgen, Inc. (a) 123,400 7,316,386
Biogen Idec, Inc. (a) 73,100 4,337,023
Genentech, Inc. (a) 213,000 10,390,140
-------------
Biotechnology Total 22,043,549
HEALTH CARE EQUIPMENT & SUPPLIES - 8.9%
Alcon, Inc. 172,900 12,939,836
Boston Scientific Corp. (a) 233,440 8,340,811
See Accompanying Notes to Financial Statements.
67
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA GROWTH FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - (CONTINUED)
HEALTH CARE - (CONTINUED)
HEALTH CARE EQUIPMENT & SUPPLIES - (CONTINUED)
Kinetic Concepts, Inc. (a) 88,900 4,424,553
St. Jude Medical, Inc. (a) 166,700 11,210,575
Thermo Electron Corp. (a) 267,700 7,032,479
Varian Medical Systems, Inc. (a) 402,000 13,326,300
Zimmer Holdings, Inc. (a) 214,900 15,322,370
-------------
Health Care Equipment & Supplies Total 72,596,924
HEALTH CARE PROVIDERS & SERVICES - 1.9%
Anthem, Inc. (a) 74,500 6,052,380
Caremark Rx, Inc. (a) 311,600 8,942,920
-------------
Health Care Providers & Services Total 14,995,300
PHARMACEUTICALS - 8.2%
Eli Lilly and Co. 126,400 8,020,080
Johnson & Johnson 282,500 16,413,250
Pfizer, Inc. 720,433 23,536,546
Teva Pharmaceutical Industries
Ltd., ADR 685,346 18,675,679
-------------
Pharmaceuticals Total 66,645,555
-------------
HEALTH CARE TOTAL 176,281,328
INDUSTRIALS - 10.8%
COMMERCIAL SERVICES & SUPPLIES - 1.0%
Cendant Corp. 370,900 8,022,567
-------------
Commercial Services & Supplies Total 8,022,567
ELECTRICAL EQUIPMENT - 0.9%
Rockwell Automation, Inc. 177,800 6,934,200
-------------
Electrical Equipment Total 6,934,200
INDUSTRIAL CONGLOMERATES - 6.0%
3M Co. 154,600 12,732,856
General Electric Co. 377,485 12,377,733
Tyco International Ltd. 752,610 23,571,745
-------------
Industrial Conglomerates Total 48,682,334
MACHINERY - 2.9%
Ingersoll-Rand Co., Class A 136,100 8,847,861
ITT Industries, Inc. 186,500 14,752,150
-------------
Machinery Total 23,600,011
-------------
INDUSTRIALS TOTAL 87,239,112
INFORMATION TECHNOLOGY - 28.0%
COMMUNICATIONS EQUIPMENT - 5.9%
Avaya, Inc. (a) 308,300 3,736,596
Cisco Systems, Inc. (a) 1,105,075 20,731,207
Juniper Networks, Inc. (a) 198,600 4,545,954
Motorola, Inc. 160,400 2,590,460
QUALCOMM, Inc. 420,600 16,003,830
-------------
Communications Equipment Total 47,608,047
SHARES VALUE ($)
------------ -------------
COMPUTERS & PERIPHERALS - 4.5%
Dell, Inc. (a) 385,290 13,423,504
EMC Corp. (a) 331,400 3,569,178
International Business Machines Corp. 139,500 11,814,255
Lexmark International, Inc., Class A (a) 88,000 7,783,600
-------------
Computers & Peripherals Total 36,590,537
ELECTRONIC EQUIPMENT & INSTRUMENTS - 0.5%
Flextronics International Ltd. (a) 325,500 4,039,455
-------------
Electronic Equipment & Instruments Total 4,039,455
INTERNET SOFTWARE & SERVICES - 1.0%
Yahoo!, Inc. (a) 289,900 8,265,049
-------------
Internet Software & Services Total 8,265,049
IT CONSULTING & SERVICES - 1.4%
Cognizant Technology Solutions
Corp., Class A (a) 309,500 8,486,490
Paychex, Inc. 105,500 3,130,185
-------------
IT Consulting & Services Total 11,616,675
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 6.7%
Altera Corp. (a) 203,500 3,850,220
Broadcom Corp., Class A (a) 113,218 3,072,737
Intel Corp. 1,015,370 21,617,227
Linear Technology Corp. 53,800 1,924,426
Marvell Technology Group Ltd. (a) 190,200 4,397,424
Microchip Technology, Inc. 186,000 4,908,540
Samsung Electronics Co. Ltd., GDR (b) 58,000 11,237,500
Texas Instruments, Inc. 158,100 3,089,274
-------------
Semiconductors & Semiconductor Equipment Total 54,097,348
SOFTWARE - 8.0%
Amdocs Ltd. (a) 271,300 5,453,130
Mercury Interactive Corp. (a) 60,200 2,077,502
Microsoft Corp. 1,501,300 40,985,490
Oracle Corp. (a) 523,590 5,220,192
SAP AG, ADR 229,400 8,363,924
Symantec Corp. (a) 63,300 3,035,868
-------------
Software Total 65,136,106
-------------
INFORMATION TECHNOLOGY TOTAL 227,353,217
MATERIALS - 4.9%
CHEMICALS - 2.4%
Praxair, Inc. 474,700 19,263,326
-------------
Chemicals Total 19,263,326
METALS & MINING - 2.5%
Alcoa, Inc. 338,900 10,973,582
Phelps Dodge Corp. (a) 114,390 9,329,649
-------------
Metals & Mining Total 20,303,231
-------------
MATERIALS TOTAL 39,566,557
TOTAL COMMON STOCKS
(Cost of $683,842,209) 795,759,459
See Accompanying Notes to Financial Statements.
68
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA GROWTH FUND
SHARES VALUE ($)
------------ -------------
PREFERRED STOCK - 0.9%
CONSUMER DISCRETIONARY - 0.9%
MEDIA - 0.9%
News Corp., Ltd., ADR 239,400 7,122,150
-------------
Media Total 7,122,150
-------------
CONSUMER DISCRETIONARY TOTAL 7,122,150
TOTAL PREFERRED STOCK
(Cost of $7,990,668) 7,122,150
SHORT-TERM OBLIGATION - 0.5% PAR ($)
Repurchase agreement with State
Street Bank & Trust Co., dated
08/31/04, due 09/01/04 at 1.500%,
collateralized by a U.S. Treasury
Note maturing 06/15/09, market
value $4,108,256 (repurchase
proceeds $4,024,168) 4,024,000 4,024,000
-------------
TOTAL SHORT-TERM OBLIGATION
(Cost of $4,024,000) 4,024,000
TOTAL INVESTMENTS - 99.5%
(COST OF $695,856,877) (c) 806,905,609
OTHER ASSETS & LIABILITIES, NET - 0.5% 4,073,708
NET ASSETS - 100.0% 810,979,317
NOTES TO INVESTMENT PORTFOLIO:
(a) Non-income producing security.
(b) Security exempt from registration pursuant to Rule 144A under the
Securities Act of 1933. This security may be resold in transactions exempt
from registration, normally to qualified institutional buyers. At August
31, 2004, the value of this security represents 1.4% of net assets.
(c) Cost for federal income tax purposes is $706,683,505.
ACRONYM NAME
------- ----
ADR American Depositary Receipt
GDR Global Depositary Receipt
See Accompanying Notes to Financial Statements.
69
INVESTMENT PORTFOLIO ___________________________________________________________
AUGUST 31, 2004 COLUMBIA INTERNATIONAL STOCK FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - 95.1%
CONSUMER DISCRETIONARY - 14.8%
AUTO COMPONENTS - 0.8%
Denso Corp. 181,700 4,502,035
-------------
Auto Components Total 4,502,035
AUTOMOBILES - 2.9%
Renault SA 100,341 8,097,700
Toyota Motor Corp. 228,300 9,052,218
-------------
Automobiles Total 17,149,918
HOTELS, RESTAURANTS & LEISURE - 2.8%
Accor SA 104,400 4,428,704
Carnival Corp. 80,000 3,663,200
Compass Group PLC 467,838 2,634,593
InterContinental Hotels Group PLC 302,965 3,102,253
OPAP SA 148,860 2,847,527
-------------
Hotels, Restaurants & Leisure Total 16,676,277
HOUSEHOLD DURABLES - 2.6%
Funai Electric Co., Ltd. 20,000 2,816,455
Koninklijke (Royal) Philips
Electronics NV 194,900 4,524,073
Matsushita Electric Industrial Co., Ltd. 420,000 5,687,886
Nitori Co., Ltd. 42,750 2,734,519
-------------
Household Durables Total 15,762,933
MEDIA - 2.8%
Dentsu, Inc. 742 1,800,825
JC Decaux SA (a) 116,700 2,287,031
News Corp., Ltd. 437,400 3,423,437
Pearson PLC 338,200 3,792,651
Reuters Group PLC 380,300 2,205,969
WPP Group PLC 349,000 3,136,749
-------------
Media Total 16,646,662
MULTILINE RETAIL - 2.0%
Metro AG (a) 93,688 4,367,684
Seiyu Ltd. (a) 691,000 1,814,245
Takashimaya Co., Ltd. 288,000 2,646,418
Wal-Mart de Mexico SA de CV,
Series V 913,000 2,910,072
-------------
Multiline Retail Total 11,738,419
SPECIALTY RETAIL - 0.3%
Aoyama Trading Co., Ltd. 64,500 1,565,754
-------------
Specialty Retail Total 1,565,754
TEXTILES, APPAREL & LUXURY GOODS - 0.6%
Burberry Group PLC 544,846 3,572,196
-------------
Textiles, Apparel & Luxury Goods Total 3,572,196
-------------
CONSUMER DISCRETIONARY TOTAL 87,614,194
SHARES VALUE ($)
------------ -------------
CONSUMER STAPLES - 10.3%
BEVERAGES - 1.9%
Diageo PLC 606,450 7,493,795
ITO EN Ltd. 44,200 1,915,124
SABMiller PLC 144,820 1,805,573
-------------
Beverages Total 11,214,492
FOOD & STAPLES RETAILING - 0.7%
Aeon Co., Ltd. 71,300 1,173,246
Aeon Co., Ltd. 71,300 1,190,858
William Morrison Supermarkets PLC 588,442 1,922,465
-------------
Food & Staples Retailing Total 4,286,569
FOOD PRODUCTS - 4.1%
Ajinomoto Co., Inc. 245,000 2,777,162
Cadbury Schweppes PLC 346,930 2,796,216
Nestle SA, Registered Shares 44,797 10,635,163
Unilever PLC 897,120 7,722,524
-------------
Food Products Total 23,931,065
HOUSEHOLD PRODUCTS - 2.6%
Kao Corp. 233,000 5,757,688
Reckitt Benckiser PLC 370,420 9,779,167
-------------
Household Products Total 15,536,855
TOBACCO - 1.0%
Imperial Tobacco Group PLC 268,797 5,950,870
-------------
Tobacco Total 5,950,870
-------------
CONSUMER STAPLES TOTAL 60,919,851
ENERGY - 9.4%
ENERGY EQUIPMENT & SERVICES - 0.2%
Saipem S.p.A. 141,500 1,502,062
-------------
Energy Equipment & Services Total 1,502,062
OIL & GAS - 9.2%
BP PLC, ADR 259,430 13,931,391
EnCana Corp. 159,800 6,526,271
ENI S.p.A. 685,050 14,068,504
Fortum Oyj 204,600 2,881,205
Norsk Hydro ASA 38,280 2,394,853
PTT Public Co., Ltd. 788,100 2,840,682
Shell Transport & Trading Co., PLC 569,000 4,176,995
Total SA 39,790 7,788,650
-------------
Oil & Gas Total 54,608,551
-------------
ENERGY TOTAL 56,110,613
FINANCIALS - 22.1%
COMMERCIAL BANKS - 14.1%
Anglo Irish Bank Corp., PLC 206,000 3,435,383
Banco Popolare di Verona e Novara 211,600 3,494,418
Banco Popular Espanol SA 60,780 3,304,856
Bank of Ireland 231,680 3,128,880
Barclays PLC 965,610 8,997,457
BNP Paribas SA 47,554 2,897,776
Credit Agricole SA 306,871 7,773,139
See Accompanying Notes to Financial Statements.
70
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA INTERNATIONAL STOCK FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - (CONTINUED)
FINANCIALS - (CONTINUED)
COMMERCIAL BANKS - (CONTINUED)
Credit Suisse Group 76,212 2,393,572
Danske Bank A/S 160,000 3,875,875
Deutsche Bank AG, Registered Shares 21,098 1,441,767
Erste Bank der oesterreichischen
Sparkassen AG 77,309 2,954,016
Hansabank Ltd. 252,357 2,115,319
HBOS PLC 328,150 4,036,698
Kookmin Bank (a) 97,500 3,134,183
Lloyds TSB Group PLC 366,200 2,765,136
Mitsubishi Tokyo Financial Group, Inc. 487 4,410,811
Mizuho Financial Group, Inc. 755 3,075,342
National Bank of Greece SA 125,190 2,753,435
Royal Bank of Scotland Group PLC 255,071 7,142,374
Skandinaviska Enskilda Banken AB,
Class A 312,200 4,408,103
Societe Generale 41,900 3,603,133
Sumitomo Mitsui Financial Group, Inc. 461 2,807,165
-------------
Commercial Banks Total 83,948,838
DIVERSIFIED FINANCIAL SERVICES - 1.6%
ING Groep NV 379,140 9,323,887
-------------
Diversified Financial Services Total 9,323,887
INSURANCE - 4.1%
Aegon NV 137,134 1,474,789
Allianz AG 45,593 4,415,128
Axa 185,880 3,828,704
Irish Life & Permanent PLC 196,100 3,012,174
Millea Holdings, Inc. 423 5,876,585
Mitsui Sumitomo Insurance Co., Ltd. 322,000 2,872,166
T&D Holdings, Inc. 65,000 2,974,444
-------------
Insurance Total 24,453,990
REAL ESTATE - 2.3%
Mitsubishi Estate Co., Ltd. 480,000 5,441,475
Sun Hung Kai Properties Ltd. 737,000 6,881,784
Swire Pacific Ltd., Series A 208,000 1,475,536
-------------
Real Estate Total 13,798,795
-------------
FINANCIALS TOTAL 131,525,510
HEALTH CARE - 10.8%
HEALTH CARE EQUIPMENT & SUPPLIES - 2.2%
Nobel Biocare Holding AG 14,880 2,109,458
Smith & Nephew PLC 887,110 8,025,425
Synthes, Inc. 28,200 3,026,053
-------------
Health Care Equipment & Supplies Total 13,160,936
PHARMACEUTICALS - 8.6%
AstraZeneca PLC 145,300 6,719,887
Chugai Pharmaceutical Co., Ltd. 277,000 4,095,872
GlaxoSmithKline PLC 478,450 9,797,084
Novartis AG, Registered Shares 160,260 7,435,899
Sanofi-Aventis SA 107,930 7,693,766
SHARES VALUE ($)
------------ -------------
Takeda Pharmaceutical Co., Ltd. 202,600 9,192,250
Teva Pharmaceutical Industries
Ltd., ADR 215,400 5,869,650
-------------
Pharmaceuticals Total 50,804,408
-------------
HEALTH CARE TOTAL 63,965,344
INDUSTRIALS - 9.8%
BUILDING PRODUCTS - 0.5%
Wienerberger AG 78,755 2,865,696
-------------
Building Products Total 2,865,696
COMMERCIAL SERVICES & SUPPLIES - 1.1%
Randstad Holding NV 205,218 6,279,520
-------------
Commercial Services & Supplies Total 6,279,520
CONSTRUCTION & ENGINEERING - 2.0%
JGC Corp. 392,000 3,772,820
Shimizu Corp. 586,000 2,601,869
Vinci SA 50,900 5,457,352
-------------
Construction & Engineering Total 11,832,041
ELECTRICAL EQUIPMENT - 0.5%
Siemens AG, Registered Shares 42,778 2,940,880
-------------
Electrical Equipment Total 2,940,880
INDUSTRIAL CONGLOMERATES - 1.2%
Hutchison Whampoa Ltd. 380,000 2,995,743
NIWS Co., Ltd. 475 1,393,821
Smiths Group PLC 225,978 2,841,351
-------------
Industrial Conglomerates Total 7,230,915
MACHINERY - 2.8%
Atlas Copco AB, Class B 212,100 6,894,398
Heidelberger Druckmaschinen AG 92,000 2,726,364
Linde AG 49,400 2,658,444
Volvo AB, Class B 135,200 4,649,788
-------------
Machinery Total 16,928,994
ROAD & RAIL - 0.5%
Canadian National Railway Co. 70,785 3,231,899
-------------
Road & Rail Total 3,231,899
TRADING COMPANIES & DISTRIBUTORS - 0.7%
Mitsubishi Corp. 413,000 4,301,498
-------------
Trading Companies & Distributors Total 4,301,498
TRANSPORTATION INFRASTRUCTURE - 0.5%
BAA PLC 289,700 2,907,820
-------------
Transportation Infrastructure Total 2,907,820
-------------
INDUSTRIALS TOTAL 58,519,263
See Accompanying Notes to Financial Statements.
71
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA INTERNATIONAL STOCK FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - (CONTINUED)
INFORMATION TECHNOLOGY - 3.4%
ELECTRONIC EQUIPMENT & INSTRUMENTS - 1.7%
Keyence Corp. 10,500 2,168,981
Tandberg ASA 302,600 2,710,181
TDK Corp. 78,000 5,207,359
-------------
Electronic Equipment & Instruments Total 10,086,521
OFFICE ELECTRONICS - 0.9%
Canon, Inc. 118,700 5,702,795
-------------
Office Electronics Total 5,702,795
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 0.8%
Samsung Electronics Co., Ltd. 11,500 4,539,036
-------------
Semiconductors & Semiconductor
Equipment Total 4,539,036
-------------
INFORMATION TECHNOLOGY TOTAL 20,328,352
MATERIALS - 4.5%
CHEMICALS - 3.4%
BASF AG 112,200 6,079,049
L'Air Liquide SA 36,410 5,726,819
Novozymes A/S, Class B 33,300 1,403,911
Syngenta AG (a) 77,136 6,943,872
-------------
Chemicals Total 20,153,651
CONSTRUCTION MATERIALS - 0.7%
Cemex SA de CV 149,900 4,242,170
-------------
Construction Materials Total 4,242,170
PAPER & FOREST PRODUCTS - 0.4%
UPM-Kymmene Oyj 112,100 2,148,675
-------------
Paper & Forest Products Total 2,148,675
-------------
MATERIALS TOTAL 26,544,496
TELECOMMUNICATION SERVICES - 6.4%
DIVERSIFIED TELECOMMUNICATION SERVICES - 4.0%
Belgacom SA (a) 90,300 3,022,598
Bharti Tele-Ventures Ltd. (a) 798,500 2,410,898
Deutsche Telekom AG, Registered
Shares (a) 82,495 1,444,765
France Telecom SA 160,300 3,816,639
Nippon Telegraph & Telephone Corp. 778 3,394,822
TDC A/S 89,700 3,172,780
Telecom Italia S.p.A. 983,791 2,957,681
Telefonaktiebolaget LM Ericsson,
ADR (a) 122,000 3,298,880
-------------
Diversified Telecommunication Services Total 23,519,063
SHARES VALUE ($)
------------ -------------
WIRELESS TELECOMMUNICATION SERVICES - 2.4%
NTT DoCoMo, Inc. 2,193 4,102,740
Vodafone Group PLC 4,566,860 10,436,815
-------------
Wireless Telecommunication Services Total 14,539,555
-------------
TELECOMMUNICATION SERVICES TOTAL 38,058,618
UTILITIES - 3.6%
ELECTRIC UTILITIES - 3.1%
E.ON AG 127,010 9,042,039
National Grid Transco PLC 750,736 6,314,694
Scottish Power PLC 408,384 2,969,583
-------------
Electric Utilities Total 18,326,316
GAS UTILITIES - 0.5%
Centrica PLC 651,700 2,902,850
-------------
Gas Utilities Total 2,902,850
-------------
UTILITIES TOTAL 21,229,166
TOTAL COMMON STOCKS
(Cost of $522,865,352) 564,815,407
PREFERRED STOCK - 0.9%
CONSUMER DISCRETIONARY - 0.9%
AUTOMOBILES - 0.9%
Porsche AG 9,000 5,497,206
-------------
Automobiles Total 5,497,206
-------------
CONSUMER DISCRETIONARY TOTAL 5,497,206
TOTAL PREFERRED STOCK
(Cost of $5,753,047) 5,497,206
SHORT-TERM OBLIGATION - 4.8% PAR ($)
Repurchase agreement with State Street
Bank & Trust Co., dated 08/31/04, due
09/01/04 at 1.500%, collateralized by a
U.S. Treasury Note maturing 06/15/09,
market value $28,981,125 (repurchase
proceeds $28,413,184) 28,412,000 28,412,000
-------------
TOTAL SHORT-TERM OBLIGATION
(Cost of $28,412,000) 28,412,000
TOTAL INVESTMENTS - 100.8%
(cost of $557,030,399) (b) 598,724,613
OTHER ASSETS & LIABILITIES, NET - (0.8)% (4,933,346)
NET ASSETS - 100.0% 593,791,267
See Accompanying Notes to Financial Statements.
72
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA INTERNATIONAL STOCK FUND
NOTES TO INVESTMENT PORTFOLIO:
(a) Non-income producing security.
(b) Cost for federal income tax purposes is $558,824,342.
SUMMARY OF SECURITIES % OF TOTAL
BY COUNTRY (UNAUDITED) VALUE INVESTMENTS
--------------------------------------------------------------------------
United Kingdom $149,880,581 25.0%
Japan 118,827,248 19.8
France 63,399,413 10.6
Germany 40,613,326 6.8
United States* 31,438,053 5.2
Switzerland 29,517,964 4.9
Italy 22,022,665 3.7
Netherlands 21,602,269 3.6
Sweden 19,251,169 3.2
Hong Kong 11,353,063 1.9
Canada 9,758,170 1.6
Ireland 9,576,437 1.6
Denmark 8,452,566 1.4
South Korea 7,673,219 1.3
Mexico 7,152,242 1.2
Israel 5,869,650 1.0
Austria 5,819,712 1.0
Greece 5,600,962 0.9
Norway 5,105,034 0.9
Finland 5,029,880 0.8
Panama 3,663,200 0.6
Australia 3,423,437 0.6
Spain 3,304,856 0.6
Belgium 3,022,598 0.5
Thailand 2,840,682 0.5
India 2,410,898 0.4
Estonia 2,115,319 0.4
------------ -------------
$598,724,613 100.0%
============ =============
* Includes Short-Term Obligation.
Certain securities are listed by country of underlying exposure but may trade
predominately on other exchanges.
ACRONYM NAME
------- ----
ADR American Depositary Receipt
See Accompanying Notes to Financial Statements.
73
INVESTMENT PORTFOLIO ___________________________________________________________
AUGUST 31, 2004 COLUMBIA MID CAP GROWTH FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - 97.9%
CONSUMER DISCRETIONARY - 16.3%
AUTO COMPONENTS - 0.6%
Autoliv, Inc. 114,130 4,821,992
-------------
Auto Components Total 4,821,992
HOTELS, RESTAURANTS & LEISURE - 5.4%
Applebee's International, Inc. 191,200 4,602,184
Cheesecake Factory, Inc. (a) 116,900 4,837,322
Four Seasons Hotels, Inc. 46,000 2,636,720
Harrah's Entertainment, Inc. 137,500 6,626,125
Hilton Hotels Corp. 447,900 7,995,015
Marriott International, Inc., Class A 118,600 5,627,570
Yum! Brands, Inc. 369,000 14,652,990
-------------
Hotels, Restaurants & Leisure Total 46,977,926
HOUSEHOLD DURABLES - 1.9%
Centex Corp. 106,700 4,883,659
D.R. Horton, Inc. 178,900 5,535,166
Harman International Industries, Inc. 37,300 3,606,537
Pulte Homes, Inc. 41,900 2,470,005
-------------
Household Durables Total 16,495,367
LEISURE EQUIPMENT & PRODUCTS - 0.4%
Marvel Enterprises, Inc. (a) 251,300 3,686,571
-------------
Leisure Equipment & Products Total 3,686,571
MEDIA - 3.2%
Lamar Advertising Co., Class A (a) 112,900 4,932,601
Univision Communications, Inc.,
Class A (a) 405,950 13,396,350
XM Satellite Radio Holdings, Inc.,
Class A (a) 325,000 8,927,750
-------------
Media Total 27,256,701
SPECIALTY RETAIL - 3.6%
Bed Bath & Beyond, Inc. (a) 103,100 3,858,002
Chico's FAS, Inc. (a) 135,200 5,529,680
PETCO Animal Supplies, Inc. (a) 151,700 5,024,304
PETsMART, Inc. 231,200 6,487,472
Staples, Inc. 349,900 10,035,132
-------------
Specialty Retail Total 30,934,590
TEXTILES, APPAREL & LUXURY GOODS - 1.2%
Coach, Inc. (a) 245,200 10,335,180
-------------
Textiles, Apparel & Luxury Goods Total 10,335,180
-------------
CONSUMER DISCRETIONARY TOTAL 140,508,327
CONSUMER STAPLES - 3.3%
FOOD & STAPLES RETAILING - 0.7%
Whole Foods Market, Inc. 77,100 5,992,983
-------------
Food & Staples Retailing Total 5,992,983
SHARES VALUE ($)
------------ -------------
FOOD PRODUCTS - 2.1%
Bunge Ltd. 110,000 4,387,900
Dean Foods Co. (a) 240,100 8,900,507
Hershey Foods Corp. 100,200 4,837,656
-------------
Food Products Total 18,126,063
PERSONAL PRODUCTS - 0.5%
Alberto-Culver Co. 95,700 4,621,353
-------------
Personal Products Total 4,621,353
-------------
CONSUMER STAPLES TOTAL 28,740,399
ENERGY - 7.2%
ENERGY EQUIPMENT & SERVICES - 5.2%
Baker Hughes, Inc. 289,000 11,366,370
BJ Services Co. (a) 150,700 7,241,135
Cooper Cameron Corp. (a) 63,300 3,223,869
Nabors Industries Ltd. (a) 60,450 2,665,845
National-Oilwell, Inc. (a) 338,800 10,130,120
Patterson-UTI Energy, Inc. 572,500 9,915,700
-------------
Energy Equipment & Services Total 44,543,039
OIL & GAS - 2.0%
Apache Corp. 90,944 4,064,287
EOG Resources, Inc. 55,200 3,188,904
Murphy Oil Corp. 36,100 2,725,911
XTO Energy, Inc. 254,375 7,132,675
-------------
Oil & Gas Total 17,111,777
-------------
ENERGY TOTAL 61,654,816
FINANCIALS - 5.3%
CAPITAL MARKETS - 0.6%
E*TRADE Financial Corp. (a) 465,100 5,478,878
-------------
Capital Markets Total 5,478,878
COMMERCIAL BANKS - 2.6%
North Fork Bancorporation, Inc. 120,800 5,066,352
TCF Financial Corp. 121,800 7,747,698
UCBH Holdings, Inc. 120,000 4,818,000
Zions Bancorporation 77,900 4,851,612
-------------
Commercial Banks Total 22,483,662
INSURANCE - 1.1%
Ambac Financial Group, Inc. 128,800 9,724,400
-------------
Insurance Total 9,724,400
REAL ESTATE - 1.0%
St. Joe Co. 173,000 8,373,200
-------------
Real Estate Total 8,373,200
-------------
FINANCIALS TOTAL 46,060,140
See Accompanying Notes to Financial Statements.
74
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA MID CAP GROWTH FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - (CONTINUED)
HEALTH CARE - 21.5%
BIOTECHNOLOGY - 3.9%
Amylin Pharmaceuticals, Inc. (a) 361,180 7,147,752
Gen-Probe, Inc. (a) 179,800 6,490,780
Genzyme Corp. (a) 179,600 9,698,400
ImClone Systems, Inc. (a) 79,200 4,219,776
Martek Biosciences Corp. (a) 112,600 6,012,840
-------------
Biotechnology Total 33,569,548
HEALTH CARE EQUIPMENT & SUPPLIES - 7.0%
Beckman Coulter, Inc. 115,200 6,427,008
Biomet, Inc. 209,200 9,549,980
Boston Scientific Corp. (a) 98,900 3,533,697
Fisher Scientific International, Inc. (a) 219,500 12,504,915
Kinetic Concepts, Inc. (a) 243,100 12,099,087
Thermo Electron Corp. (a) 339,900 8,929,173
Varian Medical Systems, Inc. (a) 224,480 7,441,512
-------------
Health Care Equipment & Supplies Total 60,485,372
HEALTH CARE PROVIDERS & SERVICES - 4.9%
Accredo Health, Inc. (a) 199,600 4,361,260
Anthem, Inc. (a) 58,600 4,760,664
Community Health Systems, Inc. (a) 176,230 4,405,750
DaVita, Inc. (a) 455,925 13,819,087
McKesson Corp. 358,600 11,098,670
UnitedHealth Group, Inc. 61,355 4,057,406
-------------
Health Care Providers & Services Total 42,502,837
PHARMACEUTICALS - 5.7%
Barr Pharmaceuticals, Inc. (a) 132,562 5,205,710
Elan Corp., PLC, ADR (a) 361,000 8,169,430
Endo Pharmaceuticals Holdings,
Inc. (a) 355,100 6,022,496
IVAX Corp. (a) 259,875 5,031,180
Medicis Pharmaceutical Corp., Class A 473,300 17,332,246
Nektar Therapeutics (a) 334,200 4,257,708
Teva Pharmaceutical Industries
Ltd., ADR 110,100 3,000,225
-------------
Pharmaceuticals Total 49,018,995
-------------
HEALTH CARE TOTAL 185,576,752
INDUSTRIALS - 10.8%
AEROSPACE & DEFENSE - 1.1%
L-3 Communications Holdings, Inc. 77,400 4,848,336
United Defense Industries, Inc. (a) 132,800 5,076,944
-------------
Aerospace & Defense Total 9,925,280
AIR FREIGHT & LOGISTICS - 1.1%
C.H. Robinson Worldwide, Inc. 117,900 5,030,793
Expeditors International of
Washington, Inc. 95,200 4,643,856
-------------
Air Freight & Logistics Total 9,674,649
SHARES VALUE ($)
------------ -------------
AIRLINES - 0.4%
JetBlue Airways Corp. (a) 144,400 3,443,940
-------------
Airlines Total 3,443,940
BUILDING PRODUCTS - 0.6%
Masco Corp. 151,200 4,858,056
-------------
Building Products Total 4,858,056
COMMERCIAL SERVICES & SUPPLIES - 6.8%
Avery Dennison Corp. 83,800 5,208,170
Career Education Corp. (a) 93,500 2,883,540
ChoicePoint, Inc. (a) 274,590 11,601,428
Cintas Corp. 106,800 4,379,868
Corporate Executive Board Co. 203,700 11,989,782
Education Management Corp. (a) 211,700 6,152,002
Manpower, Inc. 282,600 11,934,198
Robert Half International, Inc. 176,400 4,321,800
-------------
Commercial Services & Supplies Total 58,470,788
CONSTRUCTION & ENGINEERING - 0.8%
Jacobs Engineering Group, Inc. (a) 172,300 6,738,653
-------------
Construction & Engineering Total 6,738,653
-------------
INDUSTRIALS TOTAL 93,111,366
INFORMATION TECHNOLOGY - 24.9%
COMMUNICATIONS EQUIPMENT - 3.3%
Comverse Technology, Inc. (a) 564,100 9,877,391
Harris Corp. 92,100 4,435,536
Juniper Networks, Inc. (a) 385,970 8,834,853
Polycom, Inc. (a) 276,100 5,392,233
-------------
Communications Equipment Total 28,540,013
COMPUTERS & PERIPHERALS - 0.9%
Lexmark International, Inc. (a) 46,200 4,086,390
PalmOne, Inc. (a) 119,100 3,888,615
-------------
Computers & Peripherals Total 7,975,005
ELECTRONIC EQUIPMENT & INSTRUMENTS - 2.0%
CDW Corp. 139,300 8,149,050
FLIR Systems, Inc. (a) 75,500 4,406,935
National Instruments Corp. 169,300 4,413,651
-------------
Electronic Equipment & Instruments Total 16,969,636
INTERNET SOFTWARE & SERVICES - 0.7%
Ask Jeeves, Inc. (a) 240,300 6,228,576
-------------
Internet Software & Services Total 6,228,576
IT SERVICES - 2.6%
Cognizant Technology Solutions Corp.,
Class A (a) 360,200 9,876,684
Iron Mountain, Inc. (a) 291,500 8,986,945
SunGard Data Systems, Inc. (a) 156,540 3,600,420
-------------
IT Services Total 22,464,049
See Accompanying Notes to Financial Statements.
75
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA MID CAP GROWTH FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - (CONTINUED)
INFORMATION TECHNOLOGY - (CONTINUED)
OFFICE ELECTRONICS - 1.1%
Zebra Technologies Corp., Class A (a) 159,900 9,138,285
-------------
Office Electronics Total 9,138,285
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 8.0%
Advanced Micro Devices, Inc. (a) 423,300 4,838,319
Altera Corp. (a) 304,310 5,757,545
Broadcom Corp., Class A (a) 366,900 9,957,666
Linear Technology Corp. 255,100 9,124,927
Marvell Technology Group Ltd. (a) 448,630 10,372,326
Microchip Technology, Inc. 357,050 9,422,549
National Semiconductor Corp. (a) 494,600 6,593,018
NVIDIA Corp. (a) 369,300 4,601,478
Silicon Laboratories, Inc. (a) 268,500 8,804,115
-------------
Semiconductors & Semiconductor
Equipment Total 69,471,943
SOFTWARE - 6.3%
Amdocs Ltd. (a) 270,800 5,443,080
BMC Software, Inc. (a) 419,600 6,281,412
Check Point Software Technologies
Ltd. (a) 379,600 6,658,184
Citrix Systems, Inc. (a) 378,100 6,015,571
Hyperion Solutions Corp. (a) 224,200 8,196,752
Intuit, Inc. (a) 107,400 4,541,946
Mercury Interactive Corp. (a) 249,150 8,598,167
Novell, Inc. (a) 677,800 3,999,020
VERITAS Software Corp. (a) 265,450 4,438,324
-------------
Software Total 54,172,456
-------------
INFORMATION TECHNOLOGY TOTAL 214,959,963
MATERIALS - 4.8%
CHEMICALS - 1.4%
Potash Corp. of Saskatchewan, Inc. 222,400 12,347,648
-------------
Chemicals Total 12,347,648
CONSTRUCTION MATERIALS - 0.3%
Florida Rock Industries, Inc. 58,900 2,679,950
-------------
Construction Materials Total 2,679,950
METALS & MINING - 3.1%
Allegheny Technologies, Inc. 165,000 3,103,650
Freeport-McMoRan Copper &
Gold, Inc. 132,000 4,967,160
Inco Ltd. (a) 131,300 4,482,582
Peabody Energy Corp. 178,200 9,501,624
Phelps Dodge Corp. 59,400 4,844,664
-------------
Metals & Mining Total 26,899,680
-------------
MATERIALS TOTAL 41,927,278
SHARES VALUE ($)
------------ -------------
TELECOMMUNICATION SERVICES - 3.8%
WIRELESS TELECOMMUNICATION SERVICES - 3.8%
American Tower Corp., Class A (a) 226,900 3,378,541
Crown Castle International Corp. (a) 521,100 7,456,941
Millicom International Cellular SA (a) 373,900 5,762,173
Nextel Partners, Inc., Class A (a) 456,700 6,585,614
VimpelCom, ADR (a) 39,000 3,825,900
Western Wireless Corp., Class A (a) 212,200 5,324,098
-------------
Wireless Telecommunication Services Total 32,333,267
-------------
TELECOMMUNICATION SERVICES TOTAL 32,333,267
TOTAL COMMON STOCKS
(Cost of $816,559,759) 844,872,308
CONVERTIBLE PREFERRED STOCK - 0.0%
INFORMATION TECHNOLOGY - 0.0%
INTERNET SOFTWARE & SERVICES - 0.0%
Network Specialists, Inc.,
Series A (a)(b)(c) 394,218 3,942
-------------
Internet Software & Services Total 3,942
-------------
INFORMATION TECHNOLOGY TOTAL 3,942
TOTAL CONVERTIBLE PREFERRED STOCK
(Cost of $3,000,000) 3,942
SHORT-TERM OBLIGATION - 2.7% PAR ($)
Repurchase agreement with State Street
Bank & Trust Co., dated 08/31/04, due
09/01/04 at 1.500%, collateralized by a
U.S. Treasury Note maturing 08/31/06,
market value $23,550,525 (repurchase
proceeds $23,086,962) 23,086,000 23,086,000
-------------
TOTAL SHORT-TERM OBLIGATION
(Cost of $23,086,000) 23,086,000
TOTAL INVESTMENTS - 100.6%
(COST OF $842,645,759) (d) 867,962,250
OTHER ASSETS & LIABILITIES, NET - (0.6)% (5,480,931)
NET ASSETS - 100.0% 862,481,319
NOTES TO INVESTMENT PORTFOLIO:
(a) Non-income producing security.
(b) Security exempt from registration pursuant to Rule 144A under the
Securities Act of 1933. This security may be resold in transactions exempt
from registration, normally to qualified institutional buyers. At August
31, 2004, the value of this security represents less than 0.01% of net
assets.
(c) Represents fair value as determined in good faith under procedures approved
by the Board of Directors.
(d) Cost for federal income tax purposes is $844,541,336.
ACRONYM NAME
------- ----
ADR American Depositary Receipt
See Accompanying Notes to Financial Statements.
76
INVESTMENT PORTFOLIO ___________________________________________________________
AUGUST 31, 2004 COLUMBIA SMALL CAP GROWTH FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - 99.0%
CONSUMER DISCRETIONARY - 14.0%
AUTO COMPONENTS - 2.2%
Autoliv, Inc. 205,570 8,685,332
Gentex Corp. 96,040 3,298,014
-------------
Auto Components Total 11,983,346
HOTELS, RESTAURANTS & LEISURE - 3.2%
Applebee's International, Inc. 114,710 2,761,070
CBRL Group, Inc. 106,990 3,410,841
Cheesecake Factory, Inc. (a) 50,030 2,070,241
P.F. Chang's China Bistro, Inc. (a) 66,510 2,788,099
Scientific Games Corp. (a) 209,750 3,572,043
WMS Industries, Inc. (a) 116,870 2,361,943
-------------
Hotels, Restaurants & Leisure Total 16,964,237
HOUSEHOLD DURABLES - 0.5%
Beazer Homes USA, Inc. 13,900 1,357,335
Ryland Group, Inc. 16,000 1,410,400
-------------
Household Durables Total 2,767,735
INTERNET & CATALOG RETAIL - 0.8%
Insight Enterprises, Inc. (a) 272,410 4,358,560
-------------
Internet & Catalog Retail Total 4,358,560
LEISURE EQUIPMENT & PRODUCTS - 1.2%
Nautilus Group, Inc. 330,430 6,440,081
-------------
Leisure Equipment & Products Total 6,440,081
MEDIA - 3.0%
Entercom Communications Corp. (a) 82,300 3,102,710
Entravision Communications Corp.,
Class A (a) 243,690 1,973,889
Getty Images, Inc. (a) 113,800 6,310,210
Radio One, Inc., Class D (a) 320,852 5,005,291
-------------
Media Total 16,392,100
SPECIALTY RETAIL - 2.3%
Advance Auto Parts, Inc. (a) 48,840 1,810,010
Aeropostale, Inc. (a) 181,210 5,644,691
PETCO Animal Supplies, Inc. (a) 151,830 5,028,610
-------------
Specialty Retail Total 12,483,311
TEXTILES, APPAREL & LUXURY GOODS - 0.8%
Columbia Sportswear Co. (a) 81,120 4,424,285
-------------
Textiles, Apparel & Luxury Goods Total 4,424,285
-------------
CONSUMER DISCRETIONARY TOTAL 75,813,655
CONSUMER STAPLES - 0.5%
FOOD PRODUCTS - 0.5%
Bunge Ltd. 69,300 2,764,377
-------------
Food Products Total 2,764,377
-------------
CONSUMER STAPLES TOTAL 2,764,377
SHARES VALUE ($)
------------ -------------
ENERGY - 8.1%
ENERGY EQUIPMENT & SERVICES - 6.1%
Atwood Oceanics, Inc. (a) 58,020 2,423,496
Cal Dive International, Inc. (a) 131,310 3,922,230
Input/Output, Inc. (a) 137,280 1,350,835
Key Energy Services, Inc. (a) 545,260 5,501,673
Lone Star Technologies, Inc. (a) 53,770 1,651,814
Maverick Tube Corp. (a) 71,050 2,104,501
National-Oilwell, Inc. (a) 263,320 7,873,268
Patterson-UTI Energy, Inc. 316,050 5,473,986
Precision Drilling Corp. (a) 61,900 3,057,860
-------------
Energy Equipment & Services Total 33,359,663
OIL & GAS - 2.0%
Quicksilver Resources, Inc. (a) 96,750 2,725,448
XTO Energy, Inc. 281,760 7,900,550
-------------
Oil & Gas Total 10,625,998
-------------
ENERGY TOTAL 43,985,661
FINANCIALS - 3.2%
COMMERCIAL BANKS - 0.3%
Umpqua Holdings Corp. 68,270 1,579,085
-------------
Commercial Banks Total 1,579,085
DIVERSIFIED FINANCIAL SERVICES - 1.4%
Affiliated Managers Group, Inc. (a) 157,090 7,705,265
-------------
Diversified Financial Services Total 7,705,265
INSURANCE - 1.5%
Allmerica Financial Corp. (a) 141,460 4,102,340
ProAssurance Corp. (a) 123,450 4,167,672
-------------
Insurance Total 8,270,012
-------------
FINANCIALS TOTAL 17,554,362
HEALTH CARE - 18.1%
BIOTECHNOLOGY - 1.6%
Connetics Corp. (a) 223,730 5,738,675
Nabi Biopharmaceuticals (a) 155,900 1,820,912
Onyx Pharmaceuticals, Inc. (a) 37,800 1,403,892
-------------
Biotechnology Total 8,963,479
HEALTH CARE EQUIPMENT & SUPPLIES - 3.4%
ArthroCare Corp. (a) 346,700 8,320,800
Kyphon, Inc. (a) 125,130 2,794,153
Regeneration Technologies, Inc. (a) 164,950 1,637,954
ResMed, Inc. (a) 116,990 5,588,612
-------------
Health Care Equipment & Supplies Total 18,341,519
HEALTH CARE PROVIDERS & SERVICES - 11.2%
Accredo Health, Inc. (a) 126,090 2,755,066
Cerner Corp. (a) 108,050 4,733,670
Chemed Corp. 61,800 3,379,842
DaVita, Inc. (a) 281,476 8,531,538
See Accompanying Notes to Financial Statements.
77
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA SMALL CAP GROWTH FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - (CONTINUED)
HEALTH CARE - (CONTINUED)
HEALTH CARE PROVIDERS & SERVICES - (CONTINUED)
Henry Schein, Inc. (a) 112,221 6,989,124
ICON PLC, ADR (a) 213,980 7,690,441
IDX Systems Corp. (a) 104,990 3,044,710
Kindred Healthcare, Inc. (a) 185,800 4,804,788
Pharmaceutical Product
Development, Inc. (a) 83,350 2,829,733
Renal Care Group, Inc. (a) 343,040 10,864,077
United Surgical Partners
International, Inc. (a) 146,940 5,306,003
-------------
Health Care Providers & Services Total 60,928,992
PHARMACEUTICALS - 1.9%
MGI Pharma, Inc. (a) 164,990 3,832,718
Nektar Therapeutics (a) 231,620 2,950,839
Salix Pharmaceuticals Ltd. (a) 152,245 3,561,010
-------------
Pharmaceuticals Total 10,344,567
-------------
HEALTH CARE TOTAL 98,578,557
INDUSTRIALS - 16.8%
AEROSPACE & DEFENSE - 2.5%
Armor Holdings, Inc. (a) 80,420 2,851,693
United Defense Industries, Inc. (a) 281,770 10,772,067
-------------
Aerospace & Defense Total 13,623,760
AIR FREIGHT & LOGISTICS - 0.7%
UTI Worldwide, Inc. 78,250 4,014,225
-------------
Air Freight & Logistics Total 4,014,225
COMMERCIAL SERVICES & SUPPLIES - 5.6%
Corinthian Colleges, Inc. (a) 276,930 3,148,694
Corporate Executive Board Co. 142,120 8,365,183
Education Management Corp. (a) 231,272 6,720,765
Ionics, Inc. (a) 64,410 1,688,186
Resources Connection, Inc. (a) 143,350 4,699,013
Tetra Tech, Inc. (a) 337,840 6,003,417
-------------
Commercial Services & Supplies Total 30,625,258
CONSTRUCTION & ENGINEERING - 1.0%
URS Corp. (a) 220,150 5,437,705
-------------
Construction & Engineering Total 5,437,705
ELECTRICAL EQUIPMENT - 1.8%
Artesyn Technologies, Inc. (a) 405,160 3,447,912
Power-One, Inc. (a) 373,640 2,806,036
Roper Industries, Inc. 60,820 3,354,223
-------------
Electrical Equipment Total 9,608,171
MACHINERY - 4.6%
IDEX Corp. 130,870 4,020,326
Joy Global, Inc. 152,650 4,626,822
Kennametal, Inc. 150,870 6,169,074
Terex Corp. (a) 104,170 3,763,662
SHARES VALUE ($)
------------ -------------
Wabtec Corp. 358,490 6,133,764
-------------
Machinery Total 24,713,648
ROAD & RAIL - 0.6%
Sirva, Inc. (a) 143,750 3,044,625
-------------
Road & Rail Total 3,044,625
-------------
INDUSTRIALS TOTAL 91,067,392
INFORMATION TECHNOLOGY - 31.9%
COMMUNICATIONS EQUIPMENT - 5.4%
Aspect Communications Corp. (a) 395,300 3,383,768
F5 Networks, Inc. (a) 263,970 6,485,743
Ixia (a) 639,360 5,070,125
Packeteer, Inc. (a) 522,440 5,240,073
Polycom, Inc. (a) 480,060 9,375,572
-------------
Communications Equipment Total 29,555,281
COMPUTERS & PERIPHERALS - 2.0%
Electronics for Imaging, Inc. (a) 392,910 7,811,051
PalmOne, Inc. (a) 35,700 1,165,605
Stratasys, Inc. (a) 66,730 1,663,579
-------------
Computers & Peripherals Total 10,640,235
ELECTRONIC EQUIPMENT & INSTRUMENTS - 5.8%
Amphenol Corp., Class A (a) 449,500 13,511,970
Benchmark Electronics, Inc. (a) 230,790 6,637,520
Electro Scientific Industries, Inc. (a) 182,180 3,769,304
KEMET Corp. (a) 167,250 1,450,058
National Instruments Corp. 153,540 4,002,788
RadiSys Corp. (a) 199,140 2,310,024
-------------
Electronic Equipment & Instruments Total 31,681,664
INTERNET SOFTWARE & SERVICES - 1.3%
Ask Jeeves, Inc. (a) 100,090 2,594,333
Equinix, Inc. (a) 111,170 3,534,094
FindWhat.com (a) 43,930 643,574
-------------
Internet Software & Services Total 6,772,001
IT SERVICES - 5.4%
Anteon International Corp. (a) 118,590 3,895,681
CACI International, Inc., Class A (a) 135,310 6,588,244
Cognizant Technology Solutions
Corp., Class A (a) 217,810 5,972,350
Euronet Worldwide, Inc. (a) 171,210 3,006,448
Global Payments, Inc. 102,616 4,552,046
MPS Group, Inc. (a) 401,710 3,587,270
Sapient Corp. (a) 226,750 1,700,625
-------------
IT Services Total 29,302,664
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 5.6%
Axcelis Technologies, Inc. (a) 352,290 2,747,862
Credence Systems Corp. (a) 624,690 4,166,682
FormFactor, Inc. (a) 72,700 1,272,250
Integrated Device Technology, Inc. (a) 539,920 5,782,543
PLX Technology, Inc. (a) 212,080 1,331,863
Power Integrations, Inc. (a) 147,240 2,956,579
See Accompanying Notes to Financial Statements.
78
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA SMALL CAP GROWTH FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - (CONTINUED)
INFORMATION TECHNOLOGY - (CONTINUED)
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - (CONTINUED)
Sigmatel, Inc. (a) 231,100 3,880,169
Silicon Laboratories, Inc. (a) 249,420 8,178,482
-------------
Semiconductors & Semiconductor Equipment Total 30,316,430
SOFTWARE - 6.4%
Agile Software Corp. (a) 221,530 1,688,059
Altiris, Inc. (a) 146,530 3,477,157
Autodesk, Inc. 85,830 3,811,710
Citrix Systems, Inc. (a) 168,340 2,678,289
Embarcadero Technologies, Inc. (a) 320,480 2,538,202
Macromedia, Inc. (a) 309,240 5,993,071
Manhattan Associates, Inc. (a) 338,920 7,910,393
Parametric Technology Corp. (a) 902,240 4,393,909
Quest Software, Inc. (a) 247,610 2,505,813
-------------
Software Total 34,996,603
-------------
INFORMATION TECHNOLOGY TOTAL 173,264,878
MATERIALS - 5.0%
CHEMICALS - 1.7%
Airgas, Inc. 146,760 3,265,410
OM Group, Inc. (a) 178,270 6,070,093
-------------
Chemicals Total 9,335,503
METALS & MINING - 3.3%
Allegheny Technologies, Inc. 104,900 1,973,169
Arch Coal, Inc. 91,860 2,960,648
GrafTech International Ltd. (a) 429,400 4,577,404
Massey Energy Co. 117,160 3,224,243
Steel Dynamics, Inc. 158,000 4,954,880
-------------
Metals & Mining Total 17,690,344
-------------
MATERIALS TOTAL 27,025,847
TELECOMMUNICATION SERVICES - 1.4%
DIVERSIFIED TELECOMMUNICATION SERVICES - 0.7%
PTEK Holdings, Inc. (a) 453,430 3,885,895
-------------
Diversified Telecommunication Services Total 3,885,895
WIRELESS TELECOMMUNICATION SERVICES - 0.7%
Wireless Facilities, Inc. (a) 552,190 3,522,972
-------------
Wireless Telecommunication Services Total 3,522,972
-------------
TELECOMMUNICATION SERVICES TOTAL 7,408,867
TOTAL COMMON STOCKS
(Cost of $496,113,210) 537,463,596
PAR ($) VALUE ($)
------------ -------------
SHORT-TERM OBLIGATION - 1.3%
Repurchase agreement with State
Street Bank & Trust Co., dated
08/31/04, due 09/01/04 at 1.500%,
collateralized by a U.S. Treasury
Note maturing 06/15/09, market
value $7,063,500 (repurchase
proceeds $6,921,288) 6,921,000 6,921,000
-------------
TOTAL SHORT-TERM OBLIGATION
(Cost of $6,921,000) 6,921,000
TOTAL INVESTMENTS - 100.3%
(COST OF $503,034,210) (b) 544,384,596
OTHER ASSETS & LIABILITIES, NET - (0.3)% (1,368,289)
NET ASSETS - 100.0% 543,016,307
NOTES TO INVESTMENT PORTFOLIO:
(a) Non-income producing security.
(b) Cost for federal income tax purposes is $505,508,937.
ACRONYM NAME
------- ----
ADR American Depositary Receipt
See Accompanying Notes to Financial Statements.
79
INVESTMENT PORTFOLIO ___________________________________________________________
AUGUST 31, 2004 COLUMBIA REAL ESTATE EQUITY FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - 95.4%
CONSUMER DISCRETIONARY - 11.6%
HOTELS, RESTAURANTS & LEISURE - 11.6%
Hilton Hotels Corp. 2,321,900 41,445,915
La Quinta Corp. (a) 1,856,500 14,554,960
Marriott International, Inc., Class A 485,300 23,027,485
Starwood Hotels & Resorts
Worldwide, Inc. 625,900 27,664,780
-------------
Hotels, Restaurants & Leisure Total 106,693,140
-------------
CONSUMER DISCRETIONARY TOTAL 106,693,140
FINANCIALS - 71.7%
REAL ESTATE - 71.7%
Alexandria Real Estate Equities,
Inc., REIT 570,400 36,961,920
Archstone-Smith Trust, REIT 601,571 18,799,094
AvalonBay Communities, Inc., REIT 324,000 19,569,600
Boston Properties, Inc., REIT 227,400 12,616,152
Brookfield Properties Corp. 412,600 13,050,538
CenterPoint Properties Trust, REIT 461,800 19,423,308
Corporate Office Properties, Inc.,
REIT 371,180 9,817,711
Cousins Properties, Inc., REIT 1,214,850 43,734,600
Duke Realty Corp., REIT 676,700 23,007,800
Essex Property Trust, REIT 99,600 7,345,500
Equity Office Properties Trust, REIT 891,737 25,468,009
Equity Residential, REIT 1,258,306 40,756,531
General Growth Properties,
Inc., REIT 1,148,480 34,649,642
Host Marriott Corp., REIT 2,521,300 33,659,355
iStar Financial, Inc., REIT 1,117,250 44,958,140
Kimco Realty Corp., REIT 503,500 25,336,120
Liberty Property Trust, REIT 444,500 17,984,470
Newcastle Investment Corp., REIT 592,300 17,928,921
Pan Pacific Retail Properties, Inc.,
REIT 299,900 16,011,661
ProLogis, REIT 961,706 34,765,672
Public Storage, Inc., REIT 584,532 29,723,452
Regency Centers Corp., REIT 652,000 29,992,000
Simon Property Group, Inc., REIT 785,256 43,935,073
SL Green Realty Corp., REIT 259,000 12,950,000
St. Joe Co. 457,800 22,157,520
United Dominion Realty Trust,
Inc., REIT 502,800 10,674,444
Vornado Realty Trust, REIT 274,000 17,196,240
-------------
Real Estate Total 662,473,473
-------------
FINANCIALS TOTAL 662,473,473
SHARES VALUE ($)
------------ -------------
MATERIALS - 12.1%
CONTAINERS & PACKAGING - 2.9%
Smurfit-Stone Container Corp. (a) 970,400 17,214,896
Temple-Inland, Inc. 139,200 9,504,576
-------------
Containers & Packaging Total 26,719,472
PAPER & FOREST PRODUCTS - 9.2%
Bowater, Inc. 844,600 30,346,478
International Paper Co. 705,500 28,234,110
MeadWestvaco Corp. 537,700 16,211,655
Weyerhaeuser Co. 166,100 10,382,911
-------------
Paper & Forest Products Total 85,175,154
-------------
MATERIALS TOTAL 111,894,626
TOTAL COMMON STOCKS
(Cost of $603,250,342) 881,061,239
INCOME DEPOSIT SECURITY - 1.0%
CONSUMER DISCRETIONARY - 1.0%
HOTELS, RESTAURANTS & LEISURE - 1.0%
Volume Services America
Holdings, Inc. 665,500 9,676,370
-------------
Hotels, Restaurants & Leisure Total 9,676,370
-------------
CONSUMER DISCRETIONARY TOTAL 9,676,370
TOTAL INCOME DEPOSIT SECURITY
(Cost of $9,987,045) 9,676,370
SHORT-TERM OBLIGATION - 4.7% PAR ($)
Repurchase agreement with State Street
Bank & Trust Co., dated 08/31/04, due
09/01/04 at 1.500%, collateralized by
a U.S. Treasury Note maturing
05/15/08, market value $43,945,781
(repurchase proceeds $43,080,795) 43,079,000 43,079,000
-------------
TOTAL SHORT-TERM OBLIGATION
(Cost of $43,079,000) 43,079,000
TOTAL INVESTMENTS - 101.1%
(COST OF $656,316,387) (b) 933,816,609
OTHER ASSETS & LIABILITIES, NET - (1.1)% (10,493,270)
NET ASSETS - 100.0% 923,323,339
NOTES TO INVESTMENT PORTFOLIO:
(a) Non-income producing security.
(b) Cost for federal income tax purposes is $659,206,636.
ACRONYM NAME
------- ----
REIT Real Estate Investment Trust
See Accompanying Notes to Financial Statements.
80
INVESTMENT PORTFOLIO ___________________________________________________________
AUGUST 31, 2004 COLUMBIA TECHNOLOGY FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - 94.3%
CONSUMER DISCRETIONARY - 17.4%
HOUSEHOLD DURABLES - 0.9%
Sony Corp., ADR 9,000 312,030
-------------
Household Durables Total 312,030
INTERNET & CATALOG RETAIL - 10.7%
Amazon.com, Inc. (a) 22,000 839,080
Blue Nile, Inc. (a) 6,500 169,260
eBay, Inc. (a) 32,450 2,808,223
-------------
Internet & Catalog Retail Total 3,816,563
LEISURE EQUIPMENT & PRODUCTS - 1.8%
Eastman Kodak Co. 6,500 192,270
Marvel Enterprises, Inc. (a) 30,000 440,100
-------------
Leisure Equipment & Products Total 632,370
MEDIA - 3.8%
XM Satellite Radio Holdings, Inc.,
Class A (a) 49,550 1,361,138
-------------
Media Total 1,361,138
SPECIALTY RETAIL - 0.2%
PC Connection, Inc. (a) 14,000 92,400
-------------
Specialty Retail Total 92,400
-------------
CONSUMER DISCRETIONARY TOTAL 6,214,501
HEALTH CARE - 2.1%
BIOTECHNOLOGY - 1.1%
Amylin Pharmaceuticals, Inc. (a) 12,000 237,480
Cubist Pharmaceuticals, Inc. (a) 20,000 157,400
-------------
Biotechnology Total 394,880
HEALTH CARE EQUIPMENT & SUPPLIES - 1.0%
Orthovita, Inc. (a) 34,500 153,525
Thermo Electron Corp. (a) 8,500 223,295
-------------
Health Care Equipment & Supplies Total 376,820
-------------
HEALTH CARE TOTAL 771,700
INFORMATION TECHNOLOGY - 64.1%
COMMUNICATIONS EQUIPMENT - 15.7%
ADTRAN, Inc. 5,270 141,130
Alvarion Ltd. (a) 27,800 311,916
Comverse Technology, Inc. (a) 23,000 402,730
ECI Telecom Ltd. (a) 50,100 345,690
ECtel Ltd. (a) 2,148 5,089
Harris Corp. 11,250 541,800
Lucent Technologies, Inc. (a) 63,100 197,503
Motorola, Inc. 7,000 113,050
Nokia Oyj, ADR 239,000 2,839,320
QUALCOMM, Inc. 11,700 445,185
Scientific-Atlanta, Inc. 10,000 272,400
-------------
Communications Equipment Total 5,615,813
SHARES VALUE ($)
------------ -------------
COMPUTERS & PERIPHERALS - 7.0%
Apple Computer, Inc. (a) 5,400 186,246
Hypercom Corp. (a) 43,200 315,360
LG.Philips LCD Co., Ltd., ADR (a) 21,900 325,872
PalmOne, Inc. (a) 48,200 1,573,730
Sigma Designs, Inc. (a) 16,900 117,455
-------------
Computers & Peripherals Total 2,518,663
ELECTRONIC EQUIPMENT & INSTRUMENTS - 0.4%
Symbol Technologies, Inc. 10,000 129,000
-------------
Electronic Equipment & Instruments Total 129,000
INTERNET SOFTWARE & SERVICES - 4.5%
Ask Jeeves, Inc. (a) 1,600 41,472
Critical Path, Inc. (a) 275,000 194,920
NIC, Inc. (a) 94,000 508,540
VeriSign, Inc. (a) 16,000 277,760
Yahoo!, Inc. (a) 20,900 595,859
-------------
Internet Software & Services Total 1,618,551
IT SERVICES - 5.2%
Alliance Data Systems Corp. (a) 6,600 252,120
Carreker Corp. (a) 21,000 214,200
Cognizant Technology Solutions
Corp., Class A (a) 16,960 465,043
Computer Sciences Corp. (a) 6,000 278,100
Global Payments, Inc. 8,000 354,880
Satyam Computer Services Ltd., ADR 5,200 102,024
Wipro Ltd., ADR 11,150 192,226
-------------
IT Services Total 1,858,593
OFFICE ELECTRONICS - 0.9%
Zebra Technologies Corp., Class A (a) 5,925 338,614
-------------
Office Electronics Total 338,614
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 18.6%
Broadcom Corp., Class A (a) 36,275 984,504
California Micro Devices Corp. (a) 8,540 45,774
FormFactor, Inc. (a) 11,000 192,500
Marvell Technology Group Ltd. (a) 38,760 896,131
Microchip Technology, Inc. 18,550 489,535
Microtune, Inc. (a) 58,000 287,680
NVIDIA Corp. (a) 24,000 299,040
Power Integrations, Inc. (a) 25,000 502,000
Samsung Electronics Co. Ltd., GDR (b) 5,400 1,046,250
Silicon Laboratories, Inc. (a) 36,000 1,180,440
Silicon Storage Technology, Inc. (a) 16,000 92,320
Trident Microsystems, Inc. (a) 15,300 207,774
Volterra Semiconductor Corp. (a) 11,500 93,150
ZiLOG, Inc. (a) 42,700 329,644
-------------
Semiconductors & Semiconductor Equipment Total 6,646,742
SOFTWARE - 11.8%
Agile Software Corp. (a) 30,000 228,600
Amdocs Ltd. (a) 14,000 281,400
Citrix Systems, Inc. (a) 20,000 318,200
Computer Associates International, Inc. 10,300 249,466
See Accompanying Notes to Financial Statements.
81
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA TECHNOLOGY FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - (CONTINUED)
INFORMATION TECHNOLOGY - (CONTINUED)
SOFTWARE - (CONTINUED)
Intellisync Corp. (a) 241,600 541,184
Intuit, Inc. (a) 12,000 507,480
Macromedia, Inc. (a) 10,000 193,800
Manhattan Associates, Inc. (a) 24,000 560,160
Mercury Interactive Corp. (a) 5,500 189,805
Novell, Inc. (a) 25,000 147,500
Parametric Technology Corp. (a) 24,000 116,880
PeopleSoft, Inc. (a) 6,000 104,400
Peregrine Systems, Inc. (a) 10,000 189,000
SAP AG, ADR 4,000 145,840
Symantec Corp. (a) 9,600 460,416
-------------
Software Total 4,234,131
-------------
INFORMATION TECHNOLOGY TOTAL 22,960,107
TELECOMMUNICATION SERVICES - 10.7%
DIVERSIFIED TELECOMMUNICATION SERVICES - 0.8%
SpectraSite, Inc. (a) 6,150 276,381
-------------
Diversified Telecommunication Services Total 276,381
WIRELESS TELECOMMUNICATION SERVICES - 9.9%
American Tower Corp., Class A (a) 26,600 396,074
Crown Castle International Corp. (a) 27,000 386,370
Millicom International Cellular SA (a) 58,500 901,544
Mobile Telesystems, ADR 6,000 776,160
US Unwired, Inc. (a) 57,000 128,250
VimpelCom, ADR (a) 7,400 725,940
Western Wireless Corp., Class A (a) 9,300 233,337
-------------
Wireless Telecommunication Services Total 3,547,675
-------------
TELECOMMUNICATION SERVICES TOTAL 3,824,056
TOTAL COMMON STOCKS
(Cost of $31,604,269) 33,770,364
PAR ($) VALUE ($)
------------ -------------
SHORT-TERM OBLIGATION - 4.2%
Repurchase agreement with Street
Bank & Trust Co., dated 08/31/04,
due 09/01/04 at 1.500%, collateralized
by a U.S. Treasury Note maturing
10/15/06, market value $1,532,124
(repurchase proceeds $1,501,063) 1,501,000 1,501,000
-------------
TOTAL SHORT-TERM OBLIGATION
(Cost of $1,501,000) 1,501,000
TOTAL INVESTMENTS - 98.5%
(COST OF $33,105,269) (c) 35,271,364
OTHER ASSETS & LIABILITIES, NET - 1.5% 523,441
NET ASSETS - 100.0% 35,794,805
NOTES TO INVESTMENT PORTFOLIO:
(a) Non-income producing security.
(b) Security exempt from registration pursuant to Rule 144A under the
Securities Act of 1933. This security may be resold in transactions exempt
from registration, normally to qualified institutional buyers. At August
31, 2004, the value of this security represents 2.9% of net assets.
(c) Cost for federal income tax purposes is $33,905,477.
ACRONYM NAME
------- ----
ADR American Depositary Receipt
GDR Global Depositary Receipt
See Accompanying Notes to Financial Statements.
82
INVESTMENT PORTFOLIO ___________________________________________________________
AUGUST 31, 2004 COLUMBIA STRATEGIC INVESTOR FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - 77.1%
CONSUMER DISCRETIONARY - 9.9%
AUTO COMPONENTS - 1.4%
Cooper Tire & Rubber Co. 50,000 1,132,000
Modine Manufacturing Co. 52,500 1,564,500
Nokian Renkaat Oyj (Finland) 27,500 2,829,787
-------------
Auto Components Total 5,526,287
AUTOMOBILES - 0.4%
Brilliance China Automotive Holdings
Ltd., ADR 75,000 1,716,750
-------------
Automobiles Total 1,716,750
HOTELS, RESTAURANTS & LEISURE - 0.6%
California Pizza Kitchen, Inc. (a) 32,500 620,425
Darden Restaurants, Inc. 20,000 420,200
Fairmont Hotels & Resorts, Inc. 50,000 1,349,500
-------------
Hotels, Restaurants & Leisure Total 2,390,125
HOUSEHOLD DURABLES - 1.6%
Cavco Industries, Inc. (a) 20,000 762,400
Ekornes ASA (Norway) 110,000 2,270,903
Makita Corp., ADR 62,000 924,420
Matsushita Electric Industrial Co.
Ltd., ADR 75,000 1,012,500
Newell Rubbermaid, Inc. 45,000 968,850
Sony Corp., ADR 20,000 693,400
-------------
Household Durables Total 6,632,473
LEISURE EQUIPMENT & PRODUCTS - 0.5%
Eastman Kodak Co. 40,000 1,183,200
Nautilus Group, Inc. 50,000 974,500
-------------
Leisure Equipment & Products Total 2,157,700
MEDIA - 3.0%
Comcast Corp., Class A (a) 50,000 1,387,500
DirecTV Group, Inc. (a) 100,000 1,587,000
Entravision Communications Corp.,
Class A (a) 75,000 607,500
Fox Entertainment Group, Inc.,
Class A (a) 30,000 814,200
Grupo Televisa SA, ADR 20,000 962,600
Liberty Media Corp., Series A (a) 110,000 980,100
Liberty Media International, Inc.,
Series A (a) 5,500 185,900
McGraw-Hill Companies, Inc. 10,000 757,300
Media General, Inc. 30,000 1,745,700
Time Warner, Inc. (a) 125,000 2,043,750
Tribune Co. 30,000 1,252,500
-------------
Media Total 12,324,050
MULTILINE RETAIL - 1.1%
Dillard's, Inc., Class A 50,000 950,000
ITO-Yokado Co. Ltd. (Japan) 50,000 1,860,365
Stockmann Oyj, Class B (Finland) 75,000 1,765,534
-------------
Multiline Retail Total 4,575,899
SHARES VALUE ($)
------------ -------------
SPECIALTY RETAIL - 1.3%
Bombay Co., Inc. (a) 100,000 550,000
Cabelas, Inc., Class A (a) 40,000 1,024,000
CarMax, Inc. (a) 62,500 1,223,750
Circuit City Stores, Inc. 40,000 518,800
RadioShack Corp. 30,000 808,200
Toys `R' Us, Inc. (a) 50,000 812,000
West Marine, Inc. (a) 20,000 361,800
-------------
Specialty Retail Total 5,298,550
-------------
CONSUMER DISCRETIONARY TOTAL 40,621,834
CONSUMER STAPLES - 5.2%
BEVERAGES - 0.5%
Coca-Cola Femsa, SA de CV, ADR 92,500 1,885,150
-------------
Beverages Total 1,885,150
FOOD & STAPLES RETAILING - 1.4%
Albertson's, Inc. 100,000 2,458,000
United Natural Foods, Inc. (a) 50,000 1,238,000
Walgreen Co. 57,500 2,095,875
-------------
Food & Staples Retailing Total 5,791,875
FOOD PRODUCTS - 2.1%
Chips Abp, Class B 30,000 655,294
Delta & Pine Land Co. 50,000 1,270,500
General Mills, Inc. 25,000 1,181,250
Interstate Bakeries Corp. 75,000 387,750
Nestle SA, Registered Shares
(Switzerland) 10,000 2,374,079
Tyson Foods, Inc., Class A 42,500 700,400
Unilever NV, NY Shares 32,500 1,951,950
-------------
Food Products Total 8,521,223
HOUSEHOLD PRODUCTS - 0.4%
Kimberly-Clark Corp. 27,500 1,834,250
-------------
Household Products Total 1,834,250
PERSONAL PRODUCTS - 0.5%
Natura Cosmeticos SA 52,500 1,011,402
NBTY, Inc. (a) 20,000 478,600
Playtex Products, Inc. (a) 20,000 130,600
Revlon, Inc., Class A (a) 150,000 400,500
-------------
Personal Products Total 2,021,102
TOBACCO - 0.3%
Altria Group, Inc. 22,500 1,101,375
-------------
Tobacco Total 1,101,375
-------------
CONSUMER STAPLES TOTAL 21,154,975
See Accompanying Notes to Financial Statements.
83
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA STRATEGIC INVESTOR FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - (CONTINUED)
ENERGY - 8.0%
ENERGY EQUIPMENT & SERVICES - 4.5%
Core Laboratories NV (a) 50,000 1,093,500
GlobalSantaFe Corp. 37,500 1,045,500
Halliburton Co. 62,500 1,823,125
Input/Output, Inc. (a) 225,500 2,218,920
Rowan Companies, Inc. (a) 47,500 1,155,200
Schlumberger Ltd. 47,500 2,935,500
TGS Nopec Geophysical Co., ASA
(Norway) (a) 100,000 1,856,115
Transocean, Inc. (a) 100,000 3,070,000
Varco International, Inc. (a) 75,000 1,821,000
Willbros Group, Inc. (a) 100,000 1,400,000
-------------
Energy Equipment & Services Total 18,418,860
OIL & GAS - 3.5%
Anadarko Petroleum Corp. 20,000 1,184,400
BP PLC, ADR 40,000 2,148,000
ConocoPhillips 22,500 1,674,675
Devon Energy Corp. 30,000 1,944,300
El Paso Corp. 40,000 327,200
Exxon Mobil Corp. 50,000 2,305,000
Newfield Exploration Co. (a) 47,500 2,629,125
Plains Exploration & Production Co. (a) 42,500 824,925
Unocal Corp. 20,000 746,800
Valero Energy Corp. 10,000 660,300
-------------
Oil & Gas Total 14,444,725
-------------
ENERGY TOTAL 32,863,585
FINANCIALS - 11.4%
CAPITAL MARKETS - 1.8%
Bank of New York Co., Inc. 37,500 1,117,500
Morgan Stanley 50,000 2,536,500
Nikko Cordial Corp. 150,000 679,683
Nomura Holdings, Inc., ADR 100,000 1,388,000
Piper Jaffray Companies, Inc. (a) 34,850 1,502,035
-------------
Capital Markets Total 7,223,718
COMMERCIAL BANKS - 3.5%
Allied Irish Banks PLC, ADR 30,000 943,800
Fifth Third Bancorp 40,000 1,992,400
HSBC Holdings PLC, ADR 37,500 2,920,500
Kookmin Bank, ADR 40,000 1,278,000
Mitsubishi Tokyo Financial Group,
Inc., ADR 200,000 1,812,000
SunTrust Banks, Inc. 22,500 1,532,250
U.S. Bancorp 75,000 2,212,500
Zions Bancorporation 30,000 1,868,400
-------------
Commercial Banks Total 14,559,850
CONSUMER FINANCE - 0.2%
MBNA Corp. 40,000 965,600
-------------
Consumer Finance Total 965,600
SHARES VALUE ($)
------------ -------------
DIVERSIFIED FINANCIAL SERVICES - 2.5%
Citigroup, Inc. 65,000 3,027,700
GATX Corp. 77,500 2,090,175
JPMorgan Chase & Co. 130,200 5,153,316
-------------
Diversified Financial Services Total 10,271,191
INSURANCE - 2.1%
Hannover Rueckversicherung AG,
Registered Shares 50,000 1,620,757
Marsh & McLennan Companies, Inc. 27,500 1,228,975
St. Paul Traveler Companies, Inc. 42,505 1,474,498
UnumProvident Corp. 87,500 1,415,750
Wesco Financial Corp. 7,750 2,681,500
-------------
Insurance Total 8,421,480
REAL ESTATE - 0.3%
Mitsubishi Estate Co., Ltd. 30,000 340,092
Post Properties, Inc., REIT 30,000 912,000
-------------
Real Estate Total 1,252,092
THRIFTS & MORTGAGE FINANCE - 1.0%
Freddie Mac 20,000 1,342,400
MGIC Investment Corp. 20,000 1,365,400
Radian Group, Inc. 32,500 1,439,750
-------------
Thrifts & Mortgage Finance Total 4,147,550
-------------
FINANCIALS TOTAL 46,841,481
HEALTH CARE - 11.8%
BIOTECHNOLOGY - 1.9%
Amgen, Inc. (a) 47,500 2,816,275
Applera Corp. - Applied Biosystems
Group 65,000 1,237,600
Biogen Idec, Inc. (a) 37,500 2,224,875
MedImmune, Inc. (a) 62,500 1,491,875
-------------
Biotechnology Total 7,770,625
HEALTH CARE EQUIPMENT & SUPPLIES - 2.5%
Baxter International, Inc. 75,000 2,290,500
Cyberonics, Inc. (a) 67,500 1,155,600
Cytyc Corp. (a) 72,500 1,737,100
Haemonetics Corp. (a) 50,000 1,581,000
Hospira, Inc. (a) 82,500 2,285,250
National Dentex Corp. (a) 15,819 427,904
Waters Corp. (a) 20,000 866,200
-------------
Health Care Equipment & Supplies Total 10,343,554
HEALTH CARE PROVIDERS & SERVICES - 2.2%
AmerisourceBergen Corp. 12,500 676,250
Andrx Corp. (a) 50,000 1,008,000
Anthem, Inc. (a) 12,500 1,015,500
Genesis HealthCare Corp. 14,800 460,132
McKesson Corp. 82,500 2,553,375
Quest Diagnostics, Inc. 30,000 2,568,000
Tenet Healthcare Corp. 62,500 651,250
-------------
Health Care Providers & Services Total 8,932,507
See Accompanying Notes to Financial Statements.
84
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA STRATEGIC INVESTOR FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - (CONTINUED)
HEALTH CARE - (CONTINUED)
PHARMACEUTICALS - 5.2%
Abbott Laboratories 50,000 2,084,500
Bristol-Myers Squibb Co. 62,500 1,483,125
Dr. Reddy's Laboratories Ltd., ADR 30,000 474,000
Elan Corp., PLC, ADR (a) 50,000 1,131,500
Eli Lilly and Co. 32,500 2,062,125
Endo Pharmaceuticals Holdings, Inc. (a) 34,800 590,208
Gedeon Richter Ltd. (Hungary) 12,500 1,342,514
King Pharmaceuticals, Inc. (a) 40,000 498,400
Novartis AG, ADR 37,500 1,741,875
Pfizer, Inc. 86,200 2,816,154
Schering-Plough Corp. 100,000 1,846,000
Shire Pharmaceuticals Group PLC, ADR 47,500 1,231,200
Valeant Pharmaceuticals International 82,500 1,935,450
Wyeth 50,000 1,828,500
-------------
Pharmaceuticals Total 21,065,551
-------------
HEALTH CARE TOTAL 48,112,237
INDUSTRIALS - 11.4%
AEROSPACE & DEFENSE - 0.4%
BE Aerospace, Inc. (a) 72,500 768,500
Raytheon Co. 30,000 1,041,900
-------------
Aerospace & Defense Total 1,810,400
AIRLINES - 0.2%
Continental Airlines, Inc., Class B (a) 67,500 651,375
-------------
Airlines Total 651,375
BUILDING PRODUCTS - 0.3%
Toto Ltd. 130,000 1,292,957
-------------
Building Products Total 1,292,957
COMMERCIAL SERVICES & SUPPLIES - 3.0%
Avery Dennison Corp. 42,500 2,641,375
Cendant Corp. 100,000 2,163,000
Central Parking Corp. 50,000 812,500
Copart, Inc. (a) 75,000 1,629,000
G&K Services, Inc. 30,000 1,092,300
Ionics, Inc. (a) 20,000 524,200
R.R. Donnelley & Sons Co. 62,500 1,920,625
Waste Management, Inc. 50,000 1,389,500
-------------
Commercial Services & Supplies Total 12,172,500
CONSTRUCTION & ENGINEERING - 0.5%
Shaw Group, Inc. (a) 67,500 694,575
URS Corp. (a) 50,000 1,235,000
-------------
Construction & Engineering Total 1,929,575
ELECTRICAL EQUIPMENT - 0.6%
Thomas & Betts Corp. (a) 100,000 2,460,000
-------------
Electrical Equipment Total 2,460,000
SHARES VALUE ($)
------------ -------------
INDUSTRIAL CONGLOMERATES - 2.2%
3M Co. 72,500 5,971,100
General Electric Co. 60,000 1,967,400
Walter Industries, Inc. 61,100 906,724
-------------
Industrial Conglomerates Total 8,845,224
MACHINERY - 3.6%
AGCO Corp. (a) 40,000 799,600
Bucyrus Intl, Inc., Class A (Netherlands) 50,000 1,321,500
Caterpillar, Inc. 32,500 2,362,750
CNH Global NV 20,000 347,400
Eaton Corp. 40,000 2,414,000
Federal Signal Corp. 75,000 1,373,250
Flowserve Corp. (a) 30,000 688,200
JLG Industries, Inc. 125,000 1,731,250
Pall Corp. 62,500 1,522,500
Timken Co. 77,500 1,801,875
Tomra Systems ASA (Norway) 100,000 372,171
-------------
Machinery Total 14,734,496
MARINE - 0.4%
AP Moller - Maersk A/S (Denmark) 140 951,710
Finnlines Oyj (Finland) 29,000 883,648
-------------
Marine Total 1,835,358
ROAD & RAIL - 0.2%
Kansas City Southern (a) 50,000 750,000
-------------
Road & Rail Total 750,000
-------------
INDUSTRIALS TOTAL 46,481,885
INFORMATION TECHNOLOGY - 8.0%
COMMUNICATIONS EQUIPMENT - 1.3%
Andrew Corp. (a) 40,000 443,600
Comverse Technology, Inc. (a) 50,000 875,500
Lucent Technologies, Inc. (a) 100,000 313,000
Motorola, Inc. 40,000 646,000
Nokia Oyj, ADR 112,500 1,336,500
Polycom, Inc. (a) 57,500 1,122,975
Tellabs, Inc. (a) 75,000 680,250
-------------
Communications Equipment Total 5,417,825
COMPUTERS & PERIPHERALS - 0.7%
Gateway, Inc. (a) 75,000 329,250
Hypercom Corp. (a) 150,000 1,095,000
SanDisk Corp. (a) 37,500 875,625
Sun Microsystems, Inc. (a) 175,000 672,000
-------------
Computers & Peripherals Total 2,971,875
ELECTRONIC EQUIPMENT & INSTRUMENTS - 0.3%
Celestica, Inc. (a) 52,500 750,750
Solectron Corp. (a) 100,000 516,000
-------------
Electronic Equipment & Instruments Total 1,266,750
See Accompanying Notes to Financial Statements.
85
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA STRATEGIC INVESTOR FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - (CONTINUED)
INFORMATION TECHNOLOGY - (CONTINUED)
INTERNET SOFTWARE & SERVICES - 0.1%
NIC, Inc. (a) 75,000 405,750
-------------
Internet Software & Services Total 405,750
IT SERVICES - 1.7%
BISYS Group, Inc. (a) 40,000 568,000
DST Systems, Inc. (a) 72,500 3,279,900
Electronic Data Systems Corp. 50,000 961,000
First Data Corp. 48,250 2,038,563
-------------
IT Services Total 6,847,463
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 2.0%
FEI Co. (a) 75,000 1,424,250
NVIDIA Corp. (a) 125,000 1,557,500
Samsung Electronics Co. Ltd., GDR (b) 17,500 3,390,625
Texas Instruments, Inc. 82,500 1,612,050
-------------
Semiconductors & Semiconductor Equipment Total 7,984,425
SOFTWARE - 1.9%
Activision, Inc. (a) 50,000 719,500
BMC Software, Inc. (a) 40,000 598,800
Check Point Software Technologies
Ltd. (a) 57,500 1,008,550
Epiphany, Inc. (a) 50,000 196,500
Microsoft Corp. 112,500 3,071,250
Novell, Inc. (a) 125,000 737,500
Parametric Technology Corp. (a) 150,000 730,500
Quest Software, Inc. (a) 75,000 759,000
-------------
Software Total 7,821,600
-------------
INFORMATION TECHNOLOGY TOTAL 32,715,688
MATERIALS - 6.4%
CHEMICALS - 3.6%
Air Products & Chemicals, Inc. 32,500 1,702,350
Calgon Carbon Corp. 125,000 856,250
Dow Chemical Co. 30,000 1,284,300
E.I. du Pont de Nemours & Co. 42,500 1,796,050
IMC Global, Inc. 40,000 637,600
International Flavors & Fragrances, Inc. 57,500 2,215,475
Millennium Chemicals, Inc. (a) 50,000 932,500
Potash Corp. of Saskatchewan,
Inc. (Canada) 55,000 3,053,600
Rohm & Haas Co. 40,000 1,621,200
Zeon Corp. (Japan) 75,000 516,867
-------------
Chemicals Total 14,616,192
CONSTRUCTION MATERIALS - 0.4%
Martin Marietta Materials, Inc. 27,500 1,237,225
Vulcan Materials Co. 10,000 476,700
-------------
Construction Materials Total 1,713,925
SHARES VALUE ($)
------------ -------------
CONTAINERS & PACKAGING - 0.5%
Sealed Air Corp. (a) 20,000 982,400
Smurfit-Stone Container Corp. (a) 50,000 887,000
-------------
Containers & Packaging Total 1,869,400
METALS & MINING - 1.1%
Centerra Gold, Inc. (a) 50,000 603,166
Companhia Vale do Rio Doce (a) 42,500 2,455,225
CONSOL Energy, Inc. 20,000 641,600
Gammon Lake Resources, Inc. (a) 75,000 375,000
WMC Resources Ltd. 40,000 578,400
-------------
Metals & Mining Total 4,653,391
PAPER & FOREST PRODUCTS - 0.8%
Bowater, Inc. 22,500 808,425
Sappi Ltd., ADR 70,000 986,300
Votorantim Celulose e Papel SA, ADR 40,000 1,405,200
-------------
Paper & Forest Products Total 3,199,925
-------------
MATERIALS TOTAL 26,052,833
TELECOMMUNICATION SERVICES - 2.4%
DIVERSIFIED TELECOMMUNICATION SERVICES - 1.7%
CenturyTel, Inc. 40,000 1,287,600
Compania Anonima Nacional
Telefonos de Venezuela, ADR 75,000 1,486,500
SBC Communications, Inc. 50,000 1,289,500
Telekomunikasi Indonesia, ADR 62,500 1,016,250
Verizon Communications, Inc. 47,500 1,864,375
-------------
Diversified Telecommunication Services Total 6,944,225
WIRELESS TELECOMMUNICATION SERVICES - 0.7%
Millicom International Cellular SA (a) 100,000 1,541,100
VimpelCom, ADR (a) 15,000 1,471,500
-------------
Wireless Telecommunication Services Total 3,012,600
-------------
TELECOMMUNICATION SERVICES TOTAL 9,956,825
UTILITIES - 2.6%
ELECTRIC UTILITIES - 1.2%
Edison International 60,000 1,612,800
TECO Energy, Inc. 100,000 1,326,000
TXU Corp. 30,000 1,248,900
Westar Energy, Inc. 30,000 630,000
-------------
Electric Utilities Total 4,817,700
GAS UTILITIES - 0.5%
NiSource, Inc. 75,000 1,560,000
NUI Corp. 32,000 428,160
-------------
Gas Utilities Total 1,988,160
MULTI-UTILITIES & UNREGULATED POWER - 0.7%
Duke Energy Corp. 57,500 1,273,050
Dynegy, Inc., Class A (a) 100,000 436,000
ONEOK, Inc. 47,500 1,119,100
-------------
Multi-Utilities & Unregulated Power Total 2,828,150
See Accompanying Notes to Financial Statements.
86
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA STRATEGIC INVESTOR FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - (CONTINUED)
UTILITIES - (CONTINUED)
WATER UTILITIES - 0.2%
California Water Service Group 37,500 1,066,875
-------------
Water Utilities Total 1,066,875
-------------
UTILITIES TOTAL 10,700,885
TOTAL COMMON STOCKS
(Cost of $263,328,051) 315,502,228
INVESTMENT MANAGEMENT COMPANY - 0.3%
Japan Smaller Capitalization Fund, Inc.
(Cost of $818,254) 125,000 1,448,750
-------------
RIGHTS - 0.0%
CONSUMER STAPLES - 0.0%
BEVERAGES - 0.0%
Coca Cola Femsa SA de CV,
Expires 09/01/04 33,768 --(c)
-------------
Beverages Total --
-------------
CONSUMER STAPLES TOTAL --
Total RIGHTS
(Cost of $0) --
SHORT-TERM OBLIGATION - 22.4% PAR ($)
Repurchase agreement with State Street
Bank & Trust Co., dated 08/31/04, due
09/01/04 at 1.500%, collateralized by U.S.
Treasury Notes with various maturities
to 01/15/09, market value $93,422,344
(repurchase proceeds $91,583,816) 91,580,000 91,580,000
-------------
TOTAL SHORT-TERM OBLIGATION
(Cost of $91,580,000) 91,580,000
TOTAL INVESTMENTS - 99.8%
(COST OF $355,726,305) (d) 408,530,978
OTHER ASSETS & LIABILITIES, NET - 0.2% 839,538
NET ASSETS - 100.0% 409,370,516
NOTES TO INVESTMENT PORTFOLIO:
(a) Non-income producing security.
(b) Security is exempt from registration pursuant to Rule 144A under the
Securities Act of 1933. This security may be resold in transactions exempt
from registration, normally to qualified institutional buyers. At August
31, 2004, the value of this security represents 0.8% of net assets.
(c) Security has no value.
(d) Cost for federal income tax purposes is $356,959,218.
ACRONYM NAME
------- ----
ADR American Depositary Receipt
GDR Global Depositary Receipt
REIT Real Estate Investment Trust
See Accompanying Notes to Financial Statements.
87
INVESTMENT PORTFOLIO ___________________________________________________________
AUGUST 31, 2004 COLUMBIA BALANCED FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - 63.3%
CONSUMER DISCRETIONARY - 11.3%
HOTELS, RESTAURANTS & LEISURE - 0.9%
Darden Restaurants, Inc. 203,700 4,279,737
-------------
Hotels, Restaurants & Leisure Total 4,279,737
LEISURE EQUIPMENT & PRODUCTS - 0.4%
Hasbro, Inc. 106,400 1,971,592
-------------
Leisure Equipment & Products Total 1,971,592
MEDIA - 5.8%
Comcast Corp., Class A (a) 197,956 5,576,420
DirecTV Group, Inc. (a) 410,300 6,511,461
IAC/InterActiveCorp (a) 141,800 3,234,458
Liberty Media Corp., Class A (a) 607,100 5,409,261
Liberty Media International, Inc.,
Class A (a) 43,465 1,469,117
Time Warner, Inc. (a) 394,700 6,453,345
-------------
Media Total 28,654,062
MULTILINE RETAIL - 2.3%
Kohl's Corp. (a) 127,000 6,283,960
Sears, Roebuck and Co. 134,300 5,141,004
-------------
Multiline Retail Total 11,424,964
SPECIALTY RETAIL - 0.9%
RadioShack Corp. 159,600 4,299,624
-------------
Specialty Retail Total 4,299,624
TEXTILES, APPAREL & LUXURY GOODS - 1.0%
Liz Claiborne, Inc. 130,400 4,964,328
-------------
Textiles, Apparel & Luxury Goods Total 4,964,328
-------------
CONSUMER DISCRETIONARY TOTAL 55,594,307
CONSUMER STAPLES - 3.3%
BEVERAGES - 0.1%
Coca-Cola Femsa, SA de CV, ADR 37,600 766,288
-------------
Beverages Total 766,288
FOOD & STAPLES RETAILING - 1.1%
Safeway Inc. (a) 261,200 5,276,240
-------------
Food & Staples Retailing Total 5,276,240
FOOD PRODUCTS - 0.9%
Sara Lee Corp. 194,200 4,297,646
-------------
Food Products Total 4,297,646
TOBACCO - 1.2%
Altria Group, Inc. 123,215 6,031,374
-------------
Tobacco Total 6,031,374
-------------
CONSUMER STAPLES TOTAL 16,371,548
SHARES VALUE ($)
------------ -------------
ENERGY - 4.9%
ENERGY EQUIPMENT & SERVICES - 0.4%
Transocean Inc. (a) 64,200 1,970,940
-------------
Energy Equipment & Services Total 1,970,940
OIL & GAS - 4.5%
Anadarko Petroleum Corp. 42,300 2,505,006
BP PLC., ADR 31,900 1,713,030
Devon Energy Corp. 48,400 3,136,804
El Paso Corp. 347,400 2,841,732
Kerr-McGee Corp. 115,400 6,090,812
Noble Energy, Inc. 36,900 1,899,612
Unocal Corp. 107,400 4,010,316
-------------
Oil & Gas Total 22,197,312
-------------
ENERGY Total 24,168,252
FINANCIALS - 12.7%
CAPITAL MARKETS - 3.0%
A.G. Edwards, Inc. 47,300 1,645,094
JPMorgan Chase & Co. 200,220 7,924,708
Morgan Stanley 104,675 5,310,163
-------------
Capital Markets Total 14,879,965
COMMERCIAL BANKS - 0.6%
Fifth Third Bancorp 66,000 3,287,460
-------------
Commercial Banks Total 3,287,460
CONSUMER FINANCE - 0.7%
American Express Co. 66,525 3,327,581
-------------
Consumer Finance Total 3,327,581
DIVERSIFIED FINANCIAL SERVICES - 1.5%
Citigroup, Inc. 156,393 7,284,786
-------------
Diversified Financial Services Total 7,284,786
INSURANCE - 3.7%
Ace Ltd. 123,500 4,760,925
Allstate Corp. 42,100 1,987,541
Chubb Corp. 49,700 3,380,097
Marsh & McLennan Companies 59,100 2,641,179
UnumProvident Corp. 357,200 5,779,496
-------------
Insurance Total 18,549,238
THRIFTS & MORTGAGE FINANCE - 3.2%
Fannie Mae 89,925 6,694,916
MGIC Investment Corp. 130,700 8,922,889
-------------
Thrifts & Mortgage Finance Total 15,617,805
-------------
FINANCIALS TOTAL 62,946,835
See Accompanying Notes to Financial Statements.
88
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA BALANCED FUND
SHARES VALUE ($)
------------ -------------
COMMON STOCKS - (CONTINUED)
HEALTH CARE - 10.1%
BIOTECHNOLOGY - 2.2%
Amgen, Inc. (a) 97,933 5,806,448
MedImmune, Inc. (a) 214,300 5,115,341
-------------
Biotechnology Total 10,921,789
HEALTH CARE PROVIDERS & SERVICES - 3.2%
Cardinal Health, Inc. 133,900 6,052,280
McKesson Corp. 129,390 4,004,620
WebMD Corp. (a) 812,300 5,913,544
-------------
Health Care Providers & Services Total 15,970,444
PHARMACEUTICALS - 4.7%
Barr Pharmaceticals, Inc. (a) 151,500 5,949,405
Biovail Corp. (a) 255,220 3,869,135
Bristol-Myers Squibb Co. 97,600 2,316,048
Endo Pharmaceuticals Holdings, Inc. (a) 65,800 1,115,968
Johnson & Johnson 56,045 3,256,215
Pfizer, Inc. 202,090 6,602,280
-------------
Pharmaceuticals Total 23,109,051
-------------
HEALTH CARE TOTAL 50,001,284
INDUSTRIALS - 2.0%
AIRLINES - 1.0%
Southwest Airlines Co. 326,000 4,831,320
-------------
Airlines Total 4,831,320
COMMERCIAL SERVICES & SUPPLIES - 1.0%
ServiceMaster Co. 141,600 1,760,088
Waste Management, Inc. 118,175 3,284,083
-------------
Commercial Services & Supplies Total 5,044,171
-------------
INDUSTRIALS TOTAL 9,875,491
INFORMATION TECHNOLOGY - 11.5%
COMMUNICATIONS EQUIPMENT - 2.1%
Cisco Systems, Inc. (a) 169,460 3,179,070
Nortel Networks Corp. (a) 1,066,100 4,008,536
UTStarcom, Inc. (a) 216,800 3,353,896
-------------
Communications Equipment Total 10,541,502
COMPUTERS & PERIPHERALS - 3.2%
Hewlett-Packard Co. 262,800 4,701,492
International Business Machines Corp. 70,150 5,941,004
SanDisk Corp. (a) 219,800 5,132,330
-------------
Computers & Peripherals Total 15,774,826
ELECTRONIC EQUIPMENT & INSTRUMENTS - 0.8%
Garmin Ltd. 102,100 3,972,711
-------------
Electronic Equipment & Instruments Total 3,972,711
SHARES VALUE ($)
------------ -------------
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 1.4%
Linear Technology Corp. 139,800 5,000,646
NVIDIA Corp. (a) 154,175 1,921,020
-------------
Semiconductors & Semiconductor Equipment Total 6,921,666
SOFTWARE - 4.0%
Fair Isaac Corp. 51,600 1,389,588
Microsoft Corp. 451,775 12,333,458
Oracle Corp. (a) 322,845 3,218,765
Synopsys, Inc. (a) 176,700 2,820,132
-------------
Software Total 19,761,943
-------------
INFORMATION TECHNOLOGY TOTAL 56,972,648
MATERIALS - 3.6%
CHEMICALS - 0.9%
EI. du Pont de Nemours & Co. 101,400 4,285,164
-------------
Chemicals Total 4,285,164
CONTAINERS & PACKAGING - 2.0%
Sealed Air Corp. (a) 94,400 4,636,928
Smurfit-Stone Container Corp. (a) 305,700 5,423,118
-------------
Containers & Packaging Total 10,060,046
METALS & MINING - 0.7%
International Steel Group, Inc. (a) 120,300 3,657,120
-------------
Metals & Mining Total 3,657,120
-------------
MATERIALS TOTAL 18,002,330
TELECOMMUNICATION SERVICES - 3.9%
DIVERSIFIED TELECOMMUNICATION SERVICES - 3.3%
Brasil Telecom Participacoes S.A.,
ADR (a) 127,500 4,160,325
CenturyTel, Inc. 61,800 1,989,342
Qwest Communications International,
Inc. (a) 447,600 1,293,564
Telefonos de Mexico SA, ADR 198,600 6,432,654
Verizon Communications, Inc. 63,500 2,492,375
-------------
Diversified Telecommunication Services Total 16,368,260
WIRELESS TELECOMMUNICATION SERVICES - 0.6%
Nextel Communications, Inc. (a) 120,000 2,782,800
-------------
Wireless Telecommunication Services 2,782,800
-------------
TELECOMMUNICATION SERVICES TOTAL 19,151,060
TOTAL COMMON STOCKS
(Cost of $297,687,440) 313,083,755
See Accompanying Notes to Financial Statements.
89
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA BALANCED FUND
PAR ($) VALUE ($)
------------ -------------
CORPORATE NOTES & BONDS - 14.5%
INDUSTRIALS - 8.4%
Acetex Corp.,
10.875% 08/01/09 25,000 27,500
Airgas, Inc.,
9.125% 10/01/11 125,000 140,469
Alcan, Inc.,
7.250% 03/15/31 675,000 794,536
Allied Waste North America, Inc.:
6.375% 04/15/11 75,000 74,250
6.500% 11/15/10 50,000 50,125
7.375% 04/15/14 125,000 121,250
American Home Product,
6.950% 03/15/11 575,000 630,464
AmerisourceBergen Corp.,
8.125% 09/01/08 200,000 219,500
Anthem, Inc.,
6.800% 08/01/12 925,000 1,043,456
Arch Western Finance,
7.500% 07/01/13 (b)(c) 205,000 212,175
AT&T Wireless Services, Inc.,
8.750% 03/01/31 750,000 969,030
Autonation, Inc.,
9.000% 08/01/08 100,000 114,250
Ball Corp.,
7.750% 08/01/06 250,000 267,500
Boeing Co.,
6.125% 02/15/33 850,000 879,963
Canadian National Railway Co.,
7.195% 01/02/16 891,544 1,053,983
Chesapeake Energy Corp.:
7.500% 09/15/13 145,000 156,237
8.375% 11/01/08 50,000 54,625
9.000% 08/15/12 20,000 22,800
Cinemark USA, Inc.,
9.000% 02/01/13 170,000 189,125
Coca-Cola Enterprises, Inc.,
6.750% 01/15/38 1,045,000 1,177,433
Comcast Corp.,
7.050% 03/15/33 375,000 408,416
Constellation Brands, Inc.
8.000% 02/15/08 225,000 248,063
Corrections Corp. of America,
7.500% 05/01/11 175,000 184,188
Cott Beverages, Inc.,
8.000% 12/15/11 250,000 270,000
Couche-Tard,
7.500% 12/15/13 125,000 131,875
Countrywide Home Loan, Inc.,
2.875% 02/15/07 600,000 595,296
Cox Enterprises, Inc.,
8.000% 02/15/07 (b) 850,000 922,369
DaimlerChrysler NA Holding Corp.,
8.500% 01/18/31 475,000 578,854
PAR ($) VALUE ($)
------------ -------------
Deutsche Telekom International Finance BV,
8.500% 06/15/10 525,000 629,444
Dex Media East LLC,
12.125% 11/15/12 65,000 79,950
Diageo Capital PLC,
3.375% 03/20/08 1,100,000 1,096,381
DirecTV Holdings,
8.375% 03/15/13 170,000 193,375
EchoStar DBS Corp.,
5.750% 10/01/08 250,000 251,250
EquiStar Chemicals LP:
10.125% 09/01/08 25,000 27,750
10.625% 05/01/11 25,000 28,000
Ethyl Corp.,
8.875% 05/01/10 50,000 53,625
Exelon Generation Co. LLC,
6.950% 06/15/11 625,000 702,650
Extendicare Health Services:
6.875% 05/01/14 10,000 9,900
9.500% 07/01/10 10,000 11,150
Group 1 Automotive, Inc.,
8.250% 08/15/13 50,000 52,250
Finlay Fine Jewelry Corp.,
8.375% 06/01/12 (b) 35,000 37,275
Fisher Scientific International,
6.750% 08/15/14 (b) 20,000 20,600
Freescale Semiconductor,
6.875% 07/15/11 (b) 135,000 137,700
General Electric Co.,
5.000% 02/01/13 2,000,000 2,057,720
Genworth Financial, Inc.,
4.750% 06/15/09 650,000 671,456
Grant Prideco, Inc.:
9.000% 12/15/09 220,000 244,200
9.625% 12/01/07 15,000 16,800
Harrah's Operating Co., Inc.,
7.875% 12/15/05 125,000 132,031
Hasbro, Inc.,
6.150% 07/15/08 125,000 132,188
HCA, Inc.,
6.950% 05/01/12 125,000 134,401
Houghton Mifflin Co.,
9.875% 02/01/13 61,000 63,440
International Business Machines Corp.,
5.875% 11/29/32 1,000,000 1,027,400
Iron Mountain, Inc.,
7.750% 01/15/15 250,000 260,000
Jefferson Smurfit Corp.,
8.250% 10/01/12 105,000 114,450
John Deere Capital Corp.,
3.900% 01/15/08 550,000 558,415
K2, Inc.,
7.375% 07/01/14 (b) 60,000 63,085
K & F Industries, Inc.,
9.625% 12/15/10 145,000 160,950
KB Home,
8.625% 12/15/08 250,000 278,125
See Accompanying Notes to Financial Statements.
90
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA BALANCED FUND
PAR ($) VALUE ($)
------------ -------------
CORPORATE NOTES & BONDS - (CONTINUED)
INDUSTRIALS - (CONTINUED)
Kennametal, Inc.,
7.200% 06/15/12 135,000 146,846
Key Energy Services, Inc.,
6.375% 05/01/13 25,000 23,875
Kroger Co.,
6.200% 06/15/12 650,000 702,683
L-3 Communications Corp.,
6.125% 07/15/13 5,000 4,963
7.625% 06/15/12 225,000 243,562
Lamar Media Corp.,
7.250% 01/01/13 225,000 238,500
LIN Television Corp.,
6.500% 05/15/13 125,000 123,437
Lockheed Martin Corp.,
8.500% 12/01/29 700,000 913,955
Lowe's Companies, Inc.,
6.500% 03/15/29 700,000 767,739
MacDermid, Inc.,
9.125% 07/15/11 50,000 55,813
Marathon Oil Corp.,
6.800% 03/15/32 600,000 659,226
MGM Mirage, Inc.,
9.750% 06/01/07 235,000 261,731
Nalco Co.,
7.750% 11/15/11 (b) 75,000 79,687
Newell Rubbermaid, Inc.,
4.000% 05/01/10 950,000 925,224
Newfield Exploration Co.,
6.625% 09/01/14 (b) 130,000 132,600
Nextel Communications, Inc.:
7.375% 08/01/15 225,000 235,125
9.500% 02/01/11 10,000 11,300
Occidental Petroleum Corp.,
4.250% 03/15/10 775,000 779,309
Offshore Logistics, Inc.,
6.125% 06/15/13 205,000 202,950
Omnicare, Inc.,
8.125% 03/15/11 175,000 187,250
Owens-Illinois, Inc.,
7.350% 05/15/08 75,000 77,062
Park Place Entertainment Corp.,
9.375% 02/15/07 200,000 222,000
Peabody Energy Corp.,
6.875% 03/15/13 245,000 257,250
PepsiAmericas, Inc.,
3.875% 09/12/07 1,000,000 1,016,430
Plains E&P Company
7.125% 06/15/14 (b) 100,000 106,000
Pogo Producing Co.,
8.250% 04/15/11 30,000 32,925
Pride International, Inc.,
7.375% 07/15/14 (b) 120,000 127,500
Province Healthcare Co.,
7.500% 06/01/13 125,000 139,063
PAR ($) VALUE ($)
------------ -------------
R.H. Donnelley Financial Corp.,
10.875% 12/15/12 (b) 215,000 254,775
Rogers Cable, Inc.:
6.250% 06/15/13 45,000 43,874
7.875% 05/01/12 185,000 199,805
Royal Caribbean Cruises Ltd.:
6.750% 03/15/08 45,000 47,025
6.875% 12/01/13 50,000 51,375
8.000% 05/15/10 15,000 16,688
8.750% 02/02/11 130,000 150,150
Russel Metals, Inc.,
6.375% 03/01/14 65,000 62,075
Safeway, Inc.,
4.950% 08/16/10 650,000 659,782
Scotts Co.,
6.625% 11/15/13 70,000 72,800
Select Medical Corp.,
9.500% 06/15/09 150,000 163,125
Sempra Energy,
4.750% 05/15/09 700,000 717,612
Silgan Holdings, Inc.,
6.750% 11/15/13 140,000 140,000
Sinclair Broadcasting Group, Inc.,
8.000% 03/15/12 220,000 226,600
Smurfit-Stone Container Corp.:
8.375% 07/01/12 25,000 27,375
9.750% 02/01/11 35,000 39,113
Speedway Motorsports, Inc.,
6.750% 06/01/13 121,000 124,630
Starwood Hotels & Resorts Worldwide, Inc.,
7.375% 05/01/07 150,000 162,563
Station Casinos, Inc.,
6.875% 03/01/16 240,000 239,400
Suburban Propane Partners,
6.875% 12/15/13 70,000 70,000
Sun International Hotels,
8.875% 08/15/11 75,000 82,313
Synagro Technologies, Inc.,
9.500% 04/01/09 50,000 52,625
TCI Communications, Inc.,
7.250% 08/01/05 335,000 349,489
Teekay Shipping Corp.,
8.875% 07/15/11 200,000 223,000
Time Warner, Inc.,
6.625% 05/15/29 775,000 778,340
Toll Corp.,
8.250% 12/01/11 175,000 193,375
TransDigm, Inc.,
8.375% 07/15/11 125,000 131,875
Triad Hospitals, Inc.,
7.000% 05/15/12 200,000 208,000
Union Pacific Corp.,
3.875% 02/15/09 1,000,000 992,760
United Rentals NA, Inc.,
7.750% 11/15/13 155,000 144,150
United Technologies Corp.,
6.500% 06/01/09 750,000 837,998
See Accompanying Notes to Financial Statements.
91
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA BALANCED FUND
PAR ($) VALUE ($)
------------ -------------
CORPORATE NOTES & BONDS - (CONTINUED)
INDUSTRIALS - (CONTINUED)
Universal Compression, Inc.,
7.250% 05/15/10 120,000 125,400
Verizon Global Funding Corp.,
7.750% 12/01/30 1,100,000 1,298,770
Vintage Petroleum, Inc.,
7.875% 05/15/11 125,000 130,938
Vodafone Group,
7.750% 02/15/10 750,000 880,613
Wal-Mart Stores, Inc.,
4.125% 02/15/11 1,000,000 996,920
Warner Music Group,
7.375% 04/15/14 (b) 60,000 59,700
Waste Management, Inc.,
7.375% 08/01/10 700,000 806,260
Westinghouse Air Brake Technology,
6.875% 07/31/13 180,000 180,450
Williams Companies, Inc.:
7.125% 09/01/11 15,000 16,425
8.125% 03/15/12 80,000 92,000
-------------
Industrials Total 41,507,866
FINANCIALS - 4.2%
Allstate Financial Global Funding II,
2.625% 10/22/06 (b) 1,000,000 993,870
American General Finance Corp.,
5.375% 09/01/09 475,000 502,232
Capital One Bank,
4.875% 05/15/08 525,000 542,010
CIT Group, Inc.,
4.125% 02/21/06 575,000 587,535
Citigroup, Inc.,
7.250% 10/01/10 1,565,000 1,806,651
Ford Motor Credit Co.,
7.375% 10/28/09 1,605,000 1,752,243
General Motors Acceptance Corp.,
7.750% 01/19/10 1,175,000 1,294,592
Goldman Sachs Group, Inc.,
6.345% 02/15/34 745,000 746,609
Health Care Property Investors, Inc.,
6.450% 06/25/12 850,000 926,976
Household Finance Corp.,
6.400% 06/17/08 1,250,000 1,367,100
iStar Financial, Inc.:
5.125% 04/01/11 25,000 24,709
6.000% 12/15/10 75,000 76,687
7.000% 03/15/08 25,000 26,844
8.750% 08/15/08 39,000 44,363
JPMorgan Chase & Co.,
5.750% 01/02/13 1,000,000 1,055,950
Lehman Brothers Holdings, Inc.,
4.000% 01/22/08 800,000 812,800
Merrill Lynch & Co., Inc.,
4.125% 01/15/09 1,000,000 1,011,960
Morgan Stanley,
4.750% 04/01/14 1,000,000 964,740
PAR ($) VALUE ($)
------------ -------------
SLM Corp.,
5.125% 08/27/12 990,000 1,007,048
US Bank NA,
6.375% 08/01/11 1,500,000 1,672,740
Wachovia Corp.,
3.500% 08/15/08 1,300,000 1,295,996
Washington Mutual, Inc.,
5.625% 01/15/07 1,275,000 1,350,276
Wells Fargo & Co.,
5.900% 05/21/06 1,090,000 1,148,271
-------------
Financials Total 21,012,202
UTILITIES - 0.9%
Centerpoint Energy Houston,
5.750% 01/15/14 750,000 795,525
Devon Energy,
7.95% 04/15/32 700,000 854,630
Dominion Resources, Inc.,
2.800% 02/15/05 1,250,000 1,254,000
Kinder Morgan Energy Partners LP,
6.750% 03/15/11 765,000 844,101
Sprint Capital Corp.,
6.875% 11/15/28 450,000 467,667
-------------
Utilities Total 4,215,923
INTERNATIONAL - 1.0%
Ontario Province,
3.500% 09/17/07 1,000,000 1,009,600
Quebec Province,
6.500% 01/17/06 1,100,000 1,160,698
Republic of Italy,
2.500% 03/31/06 1,300,000 1,301,638
United Mexican States,
7.500% 04/08/33 1,250,000 1,318,750
-------------
International Total 4,790,686
-------------
TOTAL CORPORATE NOTES & BONDS
(Cost of $69,005,208) 71,526,677
U.S. GOVERNMENT
& AGENCY SECURITIES - 14.1%
- -----------------------------------------------------------------------------
U.S. TREASURY NOTES & BONDS - 2.2%
U.S. Treasury Bonds:
6.250% 08/15/23 1,120,000 1,300,994
7.250% 05/15/16 1,360,000 1,710,465
U.S. Treasury Inflation Index Note,
3.625% 01/15/08 3,310,934 3,639,571
U.S. Treasury Notes:
3.500% 11/15/06 3,350,000 3,422,628
4.875% 02/15/12 475,000 506,321
-------------
U.S. Treasury Notes & Bonds Total 10,579,979
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) - 0.2%
7.000% 10/15/31 - 05/15/32 843,824 902,070
-------------
Government National Mortgage
Association (GNMA) Total 902,070
See Accompanying Notes to Financial Statements.
92
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AUGUST 31, 2004 COLUMBIA BALANCED FUND
PAR ($) VALUE ($)
------------ -------------
U.S. GOVERNMENT
& AGENCY SECURITIES - (CONTINUED)
FEDERAL HOME LOAN MORTGAGE CORP. (FHLMC) - 5.9%
4.000% 09/15/15 3,120,000 3,099,597
4.500% 08/15/28 18,714,719 18,729,318
5.000% 05/01/34 1,999,372 1,985,259
5.500% 12/01/18 - 07/01/19 2,520,252 2,610,983
6.000% 03/01/17 - 08/01/17 2,377,412 2,499,432
6.500% 08/01/32 407,303 429,648
-------------
Federal Home Loan Mortgage Corp.
(FHLMC) Total 29,354,237
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) - 1.2%
5.000% 07/01/18 - 10/01/18 4,951,134 5,055,577
5.876% 07/01/32 (c) 876,904 910,101
-------------
Federal National Mortgage Association
(FNMA) Total 5,965,678
FEDERAL HOUSING ADMINISTRATION (FHA) - 0.3%
FHA Insured Project,
Pool #53-43077,
9.125% 03/25/33 1,543,377 1,558,810
-------------
Federal Housing Administration (FHA) Total 1,558,810
AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS - 4.3%
FHLMC Multiclass Mtg. Partn. Ctfs., Gtd.:
Series 2235, Class VN,
7.000% 06/15/14 314,820 314,783
Series 2462, Class JE,
6.500% 11/15/30 1,218,878 1,250,456
Series 2687, Class MQ,
4.500% 10/15/18 1,840,000 1,876,489
Series 2695, Class AT,
4.000% 10/15/26 5,300,000 5,353,005
Series 2695, Class DB,
4.000% 09/15/15 3,100,000 3,109,130
Series 2695, Class DG,
4.000% 10/15/18 3,600,000 3,337,889
Series 2700, Class PD,
4.500% 02/15/27 630,000 635,859
Series 2702, Class AB,
4.500% 07/15/27 1,312,012 1,324,197
FNMA Gtd. Remic Pass Thru Ctfs.:
Remic Tr. 2001-56, Class KD,
6.500% 08/15/31 473,409 477,179
Remic Tr. 2002-8, Class PD,
6.500% 07/25/30 2,448,791 2,501,889
Remic Tr. 2002-27, Class OG,
6.500% 12/25/30 662,812 665,525
Remic Tr. 2003-87, Class TG,
4.500% 11/25/14 630,000 637,658
-------------
Agency Collateralized Mortgage
Obligations Total 21,484,059
-------------
TOTAL U.S. GOVERNMENT
& AGENCY SECURITIES
(Cost of $69,164,161) 69,844,833
PAR ($) VALUE ($)
------------ -------------
OTHER SECURITIZED LOANS - 4.3%
ASSET-BACKED SECURITIES - 1.0%
Cityscape Home Equity Loan Trust:
Series 1997-B, Class A7,
7.410% 05/25/28 812,886 814,024
Series 1997-4, Class A4,
7.940% 10/25/18 (c) 617,382 616,566
First Alliance Mortgage Trust,
Series 1996-1, Class A1,
7.340% 06/20/27 214,890 215,440
IMC Home Equity Loan Trust:
Series 1997-3, Class A6,
7.520% 08/20/28 665,720 666,692
Series 1997-5, Class A9,
7.310% 11/20/28 1,338,774 1,341,813
Salomon Brothers Mortgage Securities VII,
Series 1998-AQ1, Class A5,
7.150% 06/25/28 1,160,020 1,155,218
-------------
Asset-Backed Securities Total 4,809,753
COLLATERALIZED MORTGAGE OBLIGATIONS - 2.3%
Bear Stearns Asset-Backed Securities, Inc.,
Series 2003-AC7, Class A1,
5.000% 01/25/34 (c) 2,517,884 2,569,778
Bear Stearns Mortgage Securities, Inc.,
Series 1996-2, Class A1,
12.700% 01/28/25 (c) 11,965 11,940
Countrywide Alternative Loan Trust,
Series 2004-2CB, Class 1A4,
2.015% 03/25/34 (c) 5,562,291 5,560,218
First Nationwide Trust,
Series 2000-1, Class IIA3,
8.000% 10/25/30 310,909 311,086
SACO I, Inc.,
Series 1995-1, Class A,
13.468% 09/25/24 (c) 41,672 41,255
Structured Asset Securities Corp.:
Series 2003-14, Class 1A3,
5.500% 05/25/33 1,136,105 1,142,467
Series 2003-21, Class 1A3,
5.500% 07/25/33 1,605,436 1,595,787
-------------
Collateralized Mortgage Obligations Total 11,232,531
COMMERCIAL MORTGAGE-BACKED SECURITIES - 1.0%
GMAC Commercial Mortgage Asset Corp.,
Series 2001-FLAA, Class B1,
2.100% 06/15/13 (b)(c) 334,960 335,001
Nationslink Funding Corp.,
Series 1999-SL, Class A5,
6.888% 05/10/07 4,380,000 4,795,793
-------------
Commercial Mortgage-Backed Securities Total 5,130,794
-------------
TOTAL OTHER SECURITIZED LOANS
(Cost of $20,760,758) 21,173,078
See Accompanying Notes to Financial Statements.
93
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA BALANCED FUND
SHARES VALUE ($)
------------ -------------
PREFERRED STOCK - 0.3%
CONSUMER DISCRETIONARY - 0.3%
MEDIA - 0.3%
News Corp., Ltd., ADR 45,825 1,363,294
Media Total 1,363,294
-------------
CONSUMER DISCRETIONARY TOTAL 1,363,294
TOTAL PREFERRED STOCK
(Cost of $1,476,767) 1,363,294
SHORT-TERM OBLIGATION - 3.9% PAR ($)
U.S. TREASURY BILL - 0.7%
1.440% 11/04/04 3,785,000 3,775,293
-------------
REPURCHASE AGREEMENT - 3.2%
Repurchase agreement with State Street
Bank & Trust Co., dated 08/31/04,
due 09/01/04 at 1.500%, collateralized
by a U.S. Treasury Note maturing
02/15/10, market value $16,111,500
(repurchase proceeds $15,793,658) 15,793,000 15,793,000
-------------
TOTAL SHORT-TERM OBLIGATIONS
(Cost of $19,568,293) 19,568,293
TOTAL INVESTMENTS - 100.4%
(COST OF $477,662,627) (d) 496,559,930
OTHER ASSETS & LIABILITIES, NET - (0.4)% (1,859,688)
NET ASSETS - 100.0% 494,700,242
NOTES TO INVESTMENT PORTFOLIO:
(a) Non-income producing security.
(b) Security exempt from registration pursuant to Rule 144A under the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers. At
August 31, 2004, these securities amounted to $3,482,337, which represents
0.7% of net assets.
(c) Variable rate security. The interest rate shown reflects the rate as of
August 31, 2004.
(d) Cost for federal income tax purposes is $479,538,783.
ACRONYM NAME
------- ----
ADR American Depositary Receipt
See Accompanying Notes to Financial Statements.
94
INVESTMENT PORTFOLIO ___________________________________________________________
AUGUST 31, 2004 COLUMBIA SHORT TERM BOND FUND
PAR ($) VALUE ($)
------------ -------------
CORPORATE NOTES & BONDS - 39.2%
INDUSTRIAL - 17.4%
Anthem, Inc.,
4.875% 08/01/05 2,225,000 2,272,459
AOL Time Warner, Inc.,
6.125% 04/15/06 2,460,000 2,583,148
AT&T Wireless Services, Inc.,
7.500% 05/01/07 1,970,000 2,180,081
Bell Atlantic Financial Services, Inc.,
7.600% 03/15/07 600,000 660,360
Boeing Co.,
8.100% 11/15/06 1,820,000 2,015,250
Bottling Group LLC,
2.450% 10/16/06 4,300,000 4,261,128
Canadian National Railway Co.,
6.450% 07/15/06 (b) 460,000 488,184
Caterpillar Financial Services Corp.,
2.500% 10/03/06 5,000,000 4,953,850
ChevronTexaco Capital Co.,
3.500% 09/17/07 3,350,000 3,385,175
Coca-Cola Enterprises, Inc.,
8.000% 01/04/05 650,000 663,188
Costco Wholesale Corp.,
5.500% 03/15/07 640,000 678,746
Cox Enterprises, Inc.,
8.000% 02/15/07 (a) 1,300,000 1,410,682
CSX Corp.,
6.460% 06/22/05 2,250,000 2,324,362
DaimlerChrysler NA Holding Corp.,
4.750% 01/15/08 1,575,000 1,623,116
Deutsche Telekom International Finance,
8.500% 06/15/10 1,450,000 1,738,463
Devon Energy Corp.,
2.750% 08/01/06 2,825,000 2,811,666
Fortune Brands, Inc.,
2.875% 12/01/06 3,275,000 3,271,758
Gannett Co., Inc.,
4.950% 04/01/05 2,000,000 2,032,660
General Mills, Inc.,
2.625% 10/24/06 2,800,000 2,778,020
GTE Southwest, Inc.,
6.000% 01/15/06 3,725,000 3,892,402
Honeywell International, Inc.,
5.125% 11/01/06 3,120,000 3,258,590
International Business Machines Corp.,
2.375% 11/01/06 2,700,000 2,677,752
Jones Intercable, Inc.,
7.625% 04/15/08 1,875,000 2,090,063
Kellogg Co.,
6.000% 04/01/06 1,250,000 1,313,563
Kroger Co.,
7.650% 04/15/07 1,585,000 1,745,941
Lockheed Martin Corp.,
7.700% 06/15/08 990,000 1,132,144
Lowe's Companies, Inc.,
7.500% 12/15/05 1,675,000 1,782,552
PAR ($) VALUE ($)
------------ -------------
Marathon Oil Corp.,
5.375% 06/01/07 2,725,000 2,870,897
Newell Rubbermaid, Inc.,
2.000% 05/01/05 3,725,000 3,711,106
Occidental Petroleum Corp.,
7.650% 02/15/06 1,500,000 1,605,750
Pitney Bowes Corp.,
5.750% 08/15/08 1,525,000 1,646,207
Procter & Gamble Co.,
4.750% 06/15/07 725,000 756,712
Safeway, Inc.,
4.950% 08/16/10 1,900,000 1,928,595
Target Corp.,
5.950% 05/15/06 1,000,000 1,054,800
TCI Communications, Inc.,
7.250% 08/01/05 1,125,000 1,173,656
Union Pacific Corp.,
3.875% 02/15/09 1,825,000 1,811,787
United Technologies Corp.,
4.875% 11/01/06 2,475,000 2,580,707
USA Waste Services, Inc.,
7.125% 10/01/07 2,430,000 2,686,730
Vodafone Group PLC,
7.750% 02/15/10 2,350,000 2,759,253
Wachovia Corp.,
3.500% 08/15/08 3,720,000 3,708,542
Wal-Mart Stores, Inc.,
4.125% 02/15/11 1,000,000 996,920
Wyeth,
4.125% 03/01/08 2,100,000 2,141,643
-------------
Industrial Total 91,458,608
FINANCIALS - 16.7%
Allstate Financial Global Funding II,
2.625% 10/22/06 (a) 2,950,000 2,931,916
American Express Credit Corp.,
3.000% 05/16/08 4,000,000 3,942,760
American General Finance Corp.,
3.000% 11/15/06 4,500,000 4,498,740
Bear Stearns Companies, Inc.,
6.500% 05/01/06 2,600,000 2,761,096
Capital One Bank,
4.875% 05/15/08 1,625,000 1,677,650
CIT Group, Inc.,
4.125% 02/21/06 1,700,000 1,737,060
Citigroup, Inc.,
6.750% 12/01/05 2,700,000 2,845,071
Countrywide Home Loans, Inc.,
2.875% 02/15/07 500,000 496,080
Credit Suisse First Boston USA, Inc.,
5.750% 04/15/07 2,375,000 2,525,171
Fifth Third Bank,
2.700% 01/30/07 2,075,000 2,069,231
Ford Motor Credit Co.,
7.375% 10/28/09 5,425,000 5,922,690
General Motors Acceptance Corp.,
7.750% 01/19/10 4,000,000 4,407,120
See Accompanying Notes to Financial Statements.
95
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA SHORT TERM BOND FUND
PAR ($) VALUE ($)
------------ -------------
CORPORATE NOTES & BONDS - (CONTINUED)
FINANCIALS - (CONTINUED)
Genworth Financial, Inc.,
4.750% 06/15/09 2,010,000 2,076,350
Goldman Sachs Group, Inc.,
4.125% 01/15/08 2,560,000 2,612,429
Health Care Property Investors, Inc.,
6.875% 06/08/05 (b) 2,075,000 2,138,246
Household Finance Corp.,
6.400% 06/17/08 3,225,000 3,527,118
JPMorgan Chase & Co.,
3.125% 12/11/06 4,000,000 4,021,320
Lehman Brothers Holdings, Inc.:
4.000% 01/22/08 2,500,000 2,540,000
8.750% 03/15/05 500,000 518,030
Marshall & Ilsley Corp.,
4.375% 08/01/09 2,670,000 2,725,616
Merrill Lynch & Co., Inc.,
2.470% 03/10/06 2,460,000 2,457,097
Morgan Stanley,
6.100% 04/15/06 2,500,000 2,636,775
Security Capital Group, Inc.,
7.150% 06/15/07 6,315,000 6,966,771
UnitedHealth Group, Inc.,
3.375% 08/15/07 1,415,000 1,419,938
U.S. Bancorp,
3.125% 03/15/08 5,750,000 5,689,453
USA Education, Inc.,
5.625% 04/10/07 4,000,000 4,230,000
Washington Mutual, Inc.,
5.625% 01/15/07 2,600,000 2,753,504
Wells Fargo & Co.,
5.900% 05/21/06 5,200,000 5,477,992
-------------
Financials Total 87,605,224
UTILITIES - 2.1%
Dominion Resources, Inc.,
2.800% 02/15/05 2,050,000 2,056,560
Exelon Generation Co.,
6.950% 06/15/11 1,850,000 2,079,844
Kinder Morgan Energy Partners LP,
8.000% 03/15/05 2,415,000 2,488,054
Sempra Energy,
4.750% 05/15/09 2,150,000 2,204,094
Sprint Capital Corp.,
6.375% 05/01/09 1,250,000 1,366,463
Virginia Electric & Power Co.,
5.375% 02/01/07 1,200,000 1,254,384
-------------
Utilities Total 11,449,399
INTERNATIONAL - 3.0%
Canadian Government Bond,
6.750% 08/28/06 1,000,000 1,082,070
Province of Ontario,
3.500% 09/17/07 3,500,000 3,533,600
PAR ($) VALUE ($)
------------ -------------
Quebec Province:
5.500% 04/11/06 4,125,000 4,297,755
6.500% 01/17/06 1,100,000 1,160,698
Republic of Italy,
2.500% 03/31/06 1,950,000 1,952,457
United Mexican States,
4.625% 10/08/08 3,600,000 3,659,400
-------------
International Total 15,685,980
-------------
TOTAL CORPORATE NOTES & BONDS
(Cost of $212,188,540) 206,199,211
OTHER SECURITIZED LOANS - 31.7%
ASSET-BACKED SECURITIES - 11.0%
Americredit Automobile Receivables Trust,
Series 2001-B, Class A4,
5.370% 06/12/08 672,865 685,252
Cityscape Home Equity Loan Trust:
Series 1997-B, Class A7,
7.410% 05/25/28 91,336 91,463
Series 1997-C, Class A3,
7.380% 07/25/28 (b) 182,440 182,677
Ford Credit Auto Owner Trust,
Series 2002-B, Class A3A,
4.140% 12/15/05 908,062 911,694
Harley Davidson Motorcycle Trust,
Series 2002-2, Class A2,
3.090% 06/15/10 1,525,000 1,541,424
Honda Auto Receivables Owner Trust,
Series 2002-3, Class A3,
3.000% 05/18/06 2,486,686 2,495,241
IMC Home Equity Loan Trust:
Series 1995-3, Class A5,
7.500% 04/25/26 970,415 980,119
Series 1997-3, Class A6,
7.520% 08/20/28 524,587 525,353
Series 1997-3, Class A7,
7.080% 08/20/28 178,837 178,998
Series 1997-5, Class A9,
7.310% 11/20/28 101,329 101,559
Keycorp Student Loan Trust:
Series 1997-1, Class A2,
2.090% 01/27/23 (a) 3,864,544 3,916,432
Series 2003-A, Class 2A2,
1.970% 10/25/25 (a) 12,080,000 12,174,949
Money Store Home Equity Trust,
Series 1998-A, Class AF7,
6.870% 04/15/39 1,783,300 1,786,795
Nissan Auto Receivables Owner Trust,
Series 2002-B, Class A4,
4.600% 09/17/07 2,500,000 2,540,975
Residential Asset Mortgage Products,
Series 2003-RS8, Class AII8,
1.955% 09/25/33 (b) 2,861,680 2,871,238
Residential Funding Mortgage Securities I, Inc.,
Series 2003-HS3, Class A2B,
1.905% 08/25/33 (b) 195,142 195,170
See Accompanying Notes to Financial Statements.
96
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA SHORT TERM BOND FUND
PAR ($) VALUE ($)
------------ -------------
OTHER SECURITIZED LOANS - (CONTINUED)
ASSET-BACKED SECURITIES - (CONTINUED)
Sears Corp.,
Series 84, Class 3,
8.500% 04/01/17 127,722 127,722
SLM Student Loan Trust:
Series 1996-1, Class CTFS:
2.136% 07/25/11 (b) 6,030,000 6,033,920
Series 1996-4, Class CTFS,
2.186% 07/25/11 (b) 5,500,000 5,554,230
Series 1997-2, Class A2,
1.806% 01/25/10 (b) 1,337,642 1,340,794
Series 1997-4, Class CTFS,
2.256% 01/25/13 (b) 8,950,000 9,055,218
Series 2001-2, Class A1T,
1.970% 07/27/09 (b) 1,913,098 1,917,346
Toyota Auto Receivables Owner Trust,
Series 2001-C, Class A4,
4.720% 09/15/08 1,197,745 1,216,334
University Support Services Inc.,
Series 1995-A, Class A,
1.880% 09/20/15 (b) 1,562,254 1,577,705
-------------
Asset-Backed Securities Total 58,002,608
COLLATERALIZED MORTGAGE OBLIGATIONS - 20.0%
ABFS Mortgage Loan Trust,
Series 2002-4, Class A,
4.425% 12/15/33 (b) 210,781 206,472
Advanta Mortgage Loan Trust,
Series 1999-3, Class A4,
7.750% 10/25/26 158,797 162,753
Amresco Residential Securities Mortgage
Loan & Trust:
Series 1997-2, Class A9,
1.825% 06/25/27 175,932 175,962
Series 1998-3, Class A7,
1.855% 07/25/28 (b) 263,364 264,702
Bank of America Mortgage Securities:
Series 2003-1, Class 2A2,
5.250% 02/25/18 (c) 2,252,966 2,260,153
Bear Stearns Asset-Backed Securities, Inc.:
Series 1997-2, Class 1A5,
7.000% 08/25/36 (a) 943,312 964,510
Series 2003-AC2, Class A3,
3.500% 06/25/33 (b) 1,560,339 1,555,175
Series 2004-4, Class A6,
3.516% 06/25/34 (b) 3,583,400 3,556,632
CIT Equipment Collateral,
Series 2004-VT1, Class A3,
2.200% 03/20/08 3,050,000 3,031,388
Countrywide Home Loans:
Series 2002-32, Class 2A3,
5.000% 01/25/18 1,236,192 1,241,532
Series 2002-J5, Class 1A1,
5.750% 01/25/33 139,779 140,120
Series 2003-J7, Class 4A2,
2.015% 08/25/18 (b) 10,554,501 10,493,391
PAR ($) VALUE ($)
------------ -------------
Series 2004-J2, Class A2,
2.115% 03/25/34 (b) 8,342,729 8,353,908
Series 2004-2CB, Class 1A4,
2.015% 03/25/34 (b) 1,522,020 1,521,453
First Alliance Mortage Loan Trust,
Series 1994-2, Class A2,
6.680% 06/25/25 284,752 284,382
First Horizon Mortgage Pass-Through Trust:
Series 2003-2, Class 2A1,
2.115% 03/25/18 (b) 7,190,112 7,228,075
Series 2003-4, Class 2A2,
2.065% 06/25/18 (b) 2,452,306 2,462,875
GMAC Mortgage Corp. Loan Trust,
Series 2003-J3, Class A1,
2.115% 05/25/18 (b) 4,893,964 4,893,964
Ocwen Residential MBS Corp.,
Series 1998-R1, Class A1,
7.000% 10/25/40 220,703 225,195
PNC Mortgage Securities Corp.:
Series 1996-PR1, Class A,
(e) 04/28/27 (a) 15,358 15,095
Series 1998-14, Class 2A1,
6.250% 01/25/14 902,126 913,898
Residential Accredited Loans, Inc.:
Series 2002-QS9, Class A1,
2.215% 07/25/32 (b) 239,336 239,437
Series 2004-QS9, Class A1,
2.015% 06/25/34 (b) 10,491,398 10,491,398
Residential Asset Securitization Trust:
Series 2002-A14J, Class A14,
6.000% 01/25/33 394,938 395,937
Series 2003-A15, Class 1A2,
2.065% 02/25/34 11,422,817 11,421,446
Residential Funding Mortgage
Securities I, Inc.,
Series 2003-S14, Class A5,
2.020% 07/25/18 (b) 10,090,355 10,055,039
Structured Asset Securities Corp.:
Series 2002-17, Class 1A3,
6.000% 09/25/32 603,384 602,467
Series 2003-8, Class 2A7,
5.750% 04/25/33 5,042,922 5,124,877
Series 2003-14, Class 1A3,
5.500% 05/25/33 568,052 571,233
Series 2003-21, Class 1A3,
5.500% 07/25/33 384,808 382,495
Washington Mutual Mortgage
Securities Corp.:
Series 2003-MS5, Class 1A4,
2.115% 03/25/18 (b) 4,471,407 4,495,731
Series 2003-S4, Class 1A3,
2.115% 06/25/18 (b) 3,816,651 3,837,719
Wells Fargo Mortgage-Backed Securities Trust,
Series 2002-D, Class 1A1,
5.500% 08/25/32 218,249 221,540
Series 2003-9, Class 1A12,
5.250% 08/25/33 7,481,477 7,478,933
-------------
Collateralized Mortgage Obligations Total 105,269,887
See Accompanying Notes to Financial Statements.
97
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA SHORT TERM BOND FUND
PAR ($) VALUE ($)
------------ -------------
OTHER SECURITIZED LOANS - (CONTINUED)
COMMERCIAL MORTGAGE-BACKED SECURITIES - 0.7%
GMAC Commercial Mortgage Asset Corp.,
Series 2001-FLAA, Class B1,
2.100% 06/15/13 (a)(b) 429,357 429,410
Merrill Lynch Mortgage Investors, Inc.,
Series 1996-C1, Class A3,
7.420% 04/25/28 135,094 137,377
Nationslink Funding Corp.,
Series 1999-SL, Class A5,
6.888% 11/10/30 2,630,000 2,879,666
-------------
Commercial Mortgage-Backed Securities Total 3,446,453
-------------
TOTAL OTHER SECURITIZED LOANS
(Cost of $160,028,120) 166,718,948
U.S. GOVERNMENT & AGENCY SECURITIES - 18.8%
U.S. TREASURY NOTES - 2.1%
U.S. Treasury Inflation Index Notes,
3.625% 01/15/08 10,020,858 11,015,508
-------------
U.S. Treasury Notes Total 11,015,508
U.S. AGENCY BONDS - 0.3%
Federal Home Loan Bank,
3.875% 12/15/04 (d) 400,000 402,287
Morocco Government AID Bond,
1.938% 05/01/23 (b) 475,000 465,500
Small Business Administration,
2.375% 06/25/22 (b) 541,578 541,902
-------------
U.S. Agency Bonds Total 1,409,689
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) - 0.3%
6.500% 09/15/13-07/15/32 1,179,676 1,249,356
7.000% 11/15/13-08/15/29 462,648 494,170
-------------
Government National Mortgage
Association (GNMA) Total 1,743,526
FEDERAL HOME LOAN MORTGAGE CORP. (FHLMC) - 8.6%
4.000% 05/01/11 6,228,067 6,189,566
4.500% 05/01/19 26,914,033 26,933,328
5.000% 05/01/34 1,905,109 1,891,661
5.500% 05/01/17-07/01/19 8,365,026 8,670,491
6.000% 10/01/06-08/01/17 1,039,187 1,089,285
7.000% 05/01/19 802 833
7.500% 09/01/15 227,190 241,590
8.500% 07/01/30 173,994 189,330
-------------
Federal Home Loan Mortgage Corp.
(FHLMC) Total 45,206,084
PAR ($) VALUE ($)
------------ -------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) - 1.4%
5.500% 02/01/18 3,867,280 4,011,112
6.000% 03/01/09-05/01/17 2,288,170 2,389,830
6.500% 03/01/12-07/01/32 147,989 156,980
7.500% 08/01/15 183,159 195,047
8.000% 05/01/15-07/01/31 602,208 650,782
-------------
Federal National Mortgage Association
(FNMA) Total 7,403,751
AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS - 6.1%
FHLMC Multiclass Mtg. Partn. Ctfs., Gtd.:
Series 1138, Class G,
8.500% 09/15/06 50,047 50,008
Series 1283, Class K,
7.000% 06/15/22 287,542 290,165
Series 1558, Class C,
6.500% 07/15/23 73,110 73,372
Series 2500, Class PE,
6.000% 06/15/31 1,430,000 1,479,730
Series 2617, Class UA,
3.000% 06/15/09 3,826,268 3,840,271
Series 2695, Class AT,
4.000% 10/15/26 7,670,000 7,746,707
Series 2695, Class DB,
4.000% 09/15/15 3,980,000 3,991,722
FNMA:
Series 2001-34, Class AE,
6.000% 07/25/29 141,587 141,893
Series 2002-42, Class A,
6.000% 01/25/16 458,875 464,147
Series 2002-95, Class EB,
5.000% 04/25/31 7,290,552 7,390,692
Series 2003-92, Class FA,
2.165% 09/25/18 (b) 4,123,735 4,127,717
Gtd. Remic Pass Thru Ctfs.:
Remic Tr. 1991-146, Class Z,
8.000% 10/25/06 17,911 18,590
Remic Tr. 1993-92, Class C,
(e) 05/25/23 1,295,000 985,220
Remic Tr. 1998-36, Class GA,
6.000% 12/18/27 353,272 355,664
GNMA Gtd. Remic Pass Thru Ctfs.,
Remic Tr. 1997-7, Class PC,
5.000% 05/16/27 948,663 972,239
-------------
Agency Collateralized Mortgage
Obligations Total 31,928,137
-------------
TOTAL U.S. GOVERNMENT
& AGENCY SECURITIES
(Cost of $97,749,455) 98,706,695
See Accompanying Notes to Financial Statements.
98
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA SHORT TERM BOND FUND
PAR ($) VALUE ($)
------------ -------------
SHORT-TERM OBLIGATIONS - 9.7%
U.S. TREASURY BILL - 3.8%
1.443% 11/04/04 19,955,000 19,903,827
-------------
REPURCHASE AGREEMENT - 5.9%
Repurchase agreement with State Street
Bank & Trust Co., dated 08/31/04, due
09/01/04 at 1.500%, collateralized by
a U.S. Treasury Note maturing
08/31/06, market value $31,680,350
(repurchase proceeds $31,056,294) 31,055,000 31,055,000
-------------
TOTAL SHORT-TERM OBLIGATIONS
(Cost of $50,958,827) 50,958,827
TOTAL INVESTMENTS - 99.4%
(COST OF $520,924,942) (F) 522,583,681
OTHER ASSETS & LIABILITIES, NET - 0.6% 2,914,506
NET ASSETS - 100.0% 525,498,187
NOTES TO INVESTMENT PORTFOLIO:
(a) Security exempt from registration pursuant to Rule 144A under the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers. At
August 31, 2004, these securities amounted to $21,827,899, which represents
4.2% of net assets.
(b) Variable rate security. The interest rate shown reflects the rate as of
August 31, 2004.
(c) Investments in affiliates during the year ended August 31, 2004:
Security Name: Bank of America Mortgage Securities (as a result of a merger
effective April 1, 2004, Bank of America Corp. became the parent company of
the Investment Advisor.)
Par as of 08/31/03: $ --
Par purchased: $2,252,966
Par as of 08/31/04: $2,252,966
Net realized gain or loss: $ --
Interest income earned: $ 128,854
Value at end of period: $2,260,153
(d) Security pledged as collateral for open futures contracts.
(e) Zero coupon bond.
(f) Cost for federal income tax purposes is $520,756,129.
At August 31, 2004, the Fund held the following open short futures
contracts:
AGGREGATE EXPIRATION UNREALIZED
TYPE VALUE FACE VALUE DATE DEPRECIATION
-----------------------------------------------------------------------
2-Year U.S.
Treasury
Note $57,151,407 $57,071,250 Dec-2004 $ (80,157)
See Accompanying Notes to Financial Statements.
99
INVESTMENT PORTFOLIO ___________________________________________________________
AUGUST 31, 2004 COLUMBIA FIXED INCOME SECURITIES FUND
PAR ($) VALUE ($)
------------ -------------
U.S. GOVERNMENT & AGENCY SECURITIES - 42.4%
U.S. TREASURY NOTES & BONDS - 2.8%
U.S. Treasury Bond,
4.875% 02/15/12 2,400,000 2,558,251
U.S. Treasury Inflation Index Note,
3.625% 01/15/08 6,281,381 6,904,858
-------------
U.S. Treasury Notes & Bonds Total 9,463,109
FEDERAL HOME LOAN MORTGAGE CORP. (FHLMC) - 16.2%
3.500% 10/01/18 5,036,244 4,773,487
4.500% 05/01/19 31,846,662 31,869,494
5.000% 05/01/34 2,594,719 2,576,403
5.500% 12/01/17 - 07/01/19 5,215,075 5,402,748
6.000% 05/01/17 - 07/01/17 4,782,556 5,028,021
6.500% 08/01/32 270,735 285,588
To Be Announced,
5.500% 09/15/34 5,230,000 5,311,719
-------------
Federal Home Loan Mortgage Corp.
(FHLMC) Total 55,247,460
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) - 3.9%
5.000% 06/01/18 - 08/01/18 10,252,008 10,467,279
5.976% 06/01/32 (a) 91,825 92,799
6.000% 03/01/09 1,153,239 1,185,242
6.000% 08/01/34 - 09/01/34 374,414 388,372
6.098% 07/01/32 (a) 961,900 991,908
6.500% 07/01/32 110,414 116,329
-------------
Federal National Mortgage Association
(FNMA) Total 13,241,929
FEDERAL HOUSING ADMINISTRATION (FHA) - 0.6%
FHA Insured Project,
8.625% 05/15/33 2,099,873 2,120,871
-------------
Federal Housing Administration
(FHA) Total 2,120,871
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) - 1.3%
5.000% 06/15/34 2,850,883 2,845,642
To Be Announced,
6.000% 09/22/34 1,455,000 1,509,563
-------------
Government National Mortgage Association
(GNMA) Total 4,355,205
AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS - 17.6%
FHLMC Multiclass Mtg. Partn. Ctfs. Gtd.:
Series 1558, Class C,
6.500% 07/15/23 291,564 292,607
Series 1602, Class PJ,
6.500% 10/15/23 510,000 551,545
Series 2113, Class MU,
6.500% 08/15/27 199,533 199,952
Series 2235, Class VN,
7.000% 06/15/14 391,547 391,502
Series 2462, Class JE,
6.500% 11/15/30 3,151,575 3,233,224
PAR ($) VALUE ($)
------------ -------------
Series 2500, Class PE,
6.000% 06/15/31 5,630,000 5,825,791
Series 2687, Class MQ,
4.500% 10/15/18 3,166,000 3,228,785
Series 2689, Class PC,
4.000% 09/15/15 5,900,000 5,861,417
Series 2695, Class AT,
4.000% 10/15/26 7,720,000 7,797,207
Series 2695, Class BO,
4.500% 08/15/28 2,430,000 2,435,735
Series 2695, Class DB,
4.000% 09/15/15 7,155,000 7,176,074
Series 2695, Class DG,
4.000% 10/15/18 9,000,000 8,344,723
Series 2700, Class PD,
4.500% 02/15/27 2,050,000 2,069,064
Series 2702, Class AB,
4.500% 07/15/27 6,880,000 6,943,897
FNMA Gtd. Remic Pass Thru Ctfs.:
Remic Tr. 1996-W2, Class A7,
7.800% 06/25/26 571,286 616,724
Remic Tr. 2001-56, Class KD,
6.500% 07/25/30 1,003,376 1,011,366
Remic Tr. 2003-87, Class TG,
4.500% 11/25/14 2,050,000 2,074,919
GNMA Gtd. Remic Pass Thru Ctfs.,
Remic Tr. 2003-97, Class NC,
4.500% 04/16/28 2,090,000 2,114,528
-------------
Agency Collateralized Mortgage
Obligations Total 60,169,060
TOTAL U.S. GOVERNMENT
& AGENCY SECURITIES
(Cost of $142,286,185) 144,597,634
CORPORATE NOTES & BONDS - 42.5%
INDUSTRIALS - 26.2%
Acetex Corp.,
10.875% 08/01/09 215,000 236,500
Airgas, Inc.,
9.125% 10/01/11 215,000 241,606
Alcan, Inc.,
7.250% 03/15/31 1,400,000 1,647,926
Allied Waste North America, Inc.:
6.375% 04/15/11 175,000 173,250
6.500% 11/15/10 150,000 150,375
7.375% 04/15/14 225,000 218,250
AmerisourceBergen Corp.,
8.125% 09/01/08 300,000 329,250
Anheuser-Busch Companies, Inc.,
5.750% 04/01/10 530,000 574,096
Anthem, Inc.,
6.800% 08/01/12 1,550,000 1,748,493
Arch Western Finance,
6.750% 07/01/13 (b) 460,000 476,100
See Accompanying Notes to Financial Statements.
100
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA FIXED INCOME SECURITIES FUND
PAR ($) VALUE ($)
------------ -------------
CORPORATE NOTES & BONDS - (CONTINUED)
INDUSTRIALS - (CONTINUED)
AT&T Wireless Services, Inc.,
8.750% 03/01/31 1,200,000 1,550,448
Autonation, Inc.,
9.000% 08/01/08 200,000 228,500
Ball Corp.,
7.750% 08/01/06 450,000 481,500
Boeing Co.:
5.125% 02/15/13 335,000 343,837
6.125% 02/15/33 1,475,000 1,526,994
BP Amoco PLC,
5.900% 04/15/09 1,800,000 1,968,642
Canadian National Railway Co.,
7.195% 01/02/16 1,906,913 2,254,352
Chesapeake Energy Corp.:
7.500% 09/15/13 320,000 344,800
8.375% 11/01/08 165,000 180,263
Cinemark USA, Inc.,
9.000% 02/01/13 285,000 317,063
Coca-Cola Enterprises, Inc.,
6.750% 01/15/38 1,000,000 1,126,730
Comcast Corp.,
7.050% 03/15/33 870,000 947,526
Constellation Brands, Inc.,
8.000% 02/15/08 475,000 523,688
Corrections Corp. of America,
7.500% 05/01/11 400,000 421,000
Costco Wholesale Corp.,
5.500% 03/15/07 1,900,000 2,015,026
Cott Beverages, Inc.,
8.000% 12/15/11 470,000 507,600
Couche-Tard,
7.500% 12/15/13 245,000 258,476
Cox Communications, Inc.,
7.875% 08/15/09 235,000 258,947
Cox Enterprises, Inc.,
8.000% 02/15/07 (b) 1,350,000 1,464,939
CSX Corp.,
4.875% 11/01/09 960,000 987,312
DaimlerChrysler NA Holding Corp.,
8.500% 01/18/31 1,175,000 1,431,902
Deutsche Telekom International
Finance BV,
8.500% 06/15/10 1,390,000 1,666,527
Devon Energy Corp.,
7.950% 04/15/32 1,550,000 1,892,395
Dex Media East LLC,
12.125% 11/15/12 227,000 279,210
Diageo Capital PLC,
3.375% 03/20/08 1,570,000 1,564,835
DirecTV Holdings,
8.375% 03/15/13 245,000 278,688
EchoStar DBS Corp.,
5.750% 10/01/08 525,000 527,625
PAR ($) VALUE ($)
------------ -------------
EquiStar Chemicals LP:
10.125% 09/01/08 25,000 27,750
10.625% 05/01/11 100,000 112,000
Ethyl Corp.,
8.875% 05/01/10 50,000 53,625
Finlay Fine Jewelry Corp.,
8.375% 06/01/12 (b) 70,000 74,550
Fisher Scientific International.,
6.750% 08/15/14 (b) 40,000 41,200
Freescale Semiconductor, Inc.,
6.875% 07/15/11 (b) 275,000 280,500
General Electric Co.,
5.000% 02/01/13 2,875,000 2,957,973
General Mills, Inc.,
2.625% 10/24/06 1,915,000 1,899,967
Grant Prideco, Inc.:
9.000% 12/15/09 460,000 510,600
9.625% 12/01/07 40,000 44,800
Group 1 Automotive, Inc.,
8.250% 08/15/13 80,000 83,600
Harrah's Operating Co., Inc.,
7.875% 12/15/05 250,000 264,062
Hasbro, Inc.,
6.150% 07/15/08 250,000 264,375
HCA, Inc.,
6.950% 05/01/12 225,000 241,922
Houghton Mifflin Co.,
9.875% 02/01/13 120,000 124,800
International Business Machines Corp.,
5.875% 11/29/32 2,000,000 2,054,800
International Paper Co.,
4.250% 01/15/09 510,000 512,728
Iron Mountain, Inc.,
8.625% 04/01/13 500,000 540,000
ITT Corp.,
6.750% 11/15/05 275,000 285,656
John Deere Capital Corp.,
3.900% 01/15/08 1,400,000 1,421,420
K2, Inc.,
7.375% 07/01/14 (b) 125,000 131,428
K & F Industries, Inc.,
9.625% 12/15/10 285,000 316,350
KB Home,
8.625% 12/15/08 500,000 556,250
Kennametal, Inc.,
7.200% 06/15/12 240,000 261,060
Key Energy Services, Inc.,
6.375% 05/01/13 60,000 57,300
Kinder Morgan Energy Partners LP,
6.750% 03/15/11 1,500,000 1,655,100
Kroger Co.,
7.650% 04/15/07 1,450,000 1,597,233
L-3 Communications Corp.:
6.125% 07/15/13 5,000 4,962
7.625% 06/15/12 460,000 497,950
Lamar Media Corp.,
7.250% 01/01/13 325,000 344,500
See Accompanying Notes to Financial Statements.
101
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA FIXED INCOME SECURITIES FUND
PAR ($) VALUE ($)
------------ -------------
CORPORATE NOTES & BONDS - (CONTINUED)
INDUSTRIALS - (CONTINUED)
LIN Television Corp.,
6.500% 05/15/13 300,000 296,250
Lockheed Martin Corp.,
8.500% 12/01/29 1,175,000 1,534,139
Lowe's Companies, Inc.,
6.500% 03/15/29 1,510,000 1,656,123
MacDermid, Inc.,
9.125% 07/15/11 115,000 128,369
Marathon Oil Corp.,
6.800% 03/15/32 1,000,000 1,098,710
MGM Mirage, Inc.:
6.000% 10/01/09 225,000 229,500
9.750% 06/01/07 250,000 278,437
Nalco Co.,
7.750% 11/15/11 (b) 175,000 185,937
Newell Rubbermaid, Inc.,
4.000% 05/01/10 1,845,000 1,796,882
Newfield Exploration Co.,
6.625% 09/01/14 (b) 210,000 214,200
Nextel Communications, Inc.:
7.375% 08/01/15 450,000 470,250
9.500% 02/01/11 40,000 45,200
Occidental Petroleum Corp.,
4.250% 03/15/10 1,825,000 1,835,147
Offshore Logistics, Inc.,
6.125% 06/15/13 405,000 400,950
Omnicare, Inc.,
8.125% 03/15/11 340,000 363,800
Owens-Illinois, Inc.,
7.350% 05/15/08 125,000 128,437
Park Place Entertainment Corp.,
9.375% 02/15/07 450,000 499,500
Peabody Energy Corp.,
6.875% 03/15/13 465,000 488,250
Pepsi Bottling Holdings, Inc.,
5.625% 02/17/09 (b) 2,050,000 2,208,608
Plains E&P Co.,
7.125% 06/15/14 (b) 185,000 196,100
Pogo Producing Co.,
8.250% 04/15/11 65,000 71,337
Pride International, Inc.,
7.375% 07/15/14 (b) 220,000 233,750
Province Healthcare Co.,
7.500% 06/01/13 275,000 305,937
R.H. Donnelley Financial Corp.:
10.875% 12/15/12 75,000 88,875
10.875% 12/15/12 (b) 360,000 426,600
Rogers Cable, Inc.,
7.875% 05/01/12 470,000 507,614
Royal Caribbean Cruises, Ltd.:
6.750% 03/15/08 80,000 83,600
6.875% 12/01/13 100,000 102,750
8.000% 05/15/10 35,000 38,937
8.750% 02/02/11 255,000 294,525
PAR ($) VALUE ($)
------------ -------------
Russel Metals, Inc.,
6.375% 03/01/14 135,000 128,925
Safeway, Inc.,
4.950% 08/16/10 1,145,000 1,162,232
Scotts Co.,
6.625% 11/15/13 175,000 182,000
Select Medical Corp.,
9.500% 06/15/09 375,000 407,813
Sempra Energy,
4.750% 05/15/09 1,350,000 1,383,966
Silgan Holdings, Inc.,
6.750% 11/15/13 385,000 385,000
Sinclair Broadcasting Group, Inc.,
8.000% 03/15/12 440,000 453,200
Smurfit-Stone Container Corp.,
9.750% 02/01/11 355,000 396,712
Speedway Motorsports, Inc.,
6.750% 06/01/13 240,000 247,200
Spint Capital Corp.,
6.875% 11/15/28 950,000 987,297
Station Casinos, Inc.:
6.500% 02/01/14 15,000 14,925
6.875% 03/01/16 500,000 498,750
Suburban Propane Partners,
6.875% 12/15/13 150,000 150,000
Sun International Hotels,
8.875% 08/15/11 150,000 164,625
Synagro Technologies, Inc.,
9.500% 04/01/09 100,000 105,250
TCI Communications, Inc.,
7.250% 08/01/05 500,000 521,625
Teekay Shipping Corp.,
8.875% 07/15/11 475,000 529,625
Time Warner, Inc.,
6.625% 05/15/29 1,660,000 1,667,155
Toll Corp.,
8.250% 12/01/11 390,000 430,950
TransDigm, Inc.,
8.375% 07/15/11 300,000 316,500
Triad Hospitals, Inc.,
7.000% 05/15/12 350,000 364,000
Union Pacific Corp.,
3.875% 02/15/09 790,000 784,280
United Rentals NA, Inc.,
7.750% 11/15/13 325,000 302,250
United Technologies Corp.,
7.125% 11/15/10 1,900,000 2,204,152
UnitedHealth Group, Inc.,
3.375% 08/15/07 1,000,000 1,003,490
Universal Compression, Inc.,
7.250% 05/15/10 240,000 250,800
Verizon Global Funding Corp.,
7.750% 12/01/30 2,500,000 2,951,750
Vintage Petroleum, Inc.:
7.875% 05/15/11 275,000 288,063
8.250% 05/01/12 25,000 27,250
Vodafone Group PLC,
7.750% 02/15/10 1,500,000 1,761,225
See Accompanying Notes to Financial Statements.
102
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA FIXED INCOME SECURITIES FUND
PAR ($) VALUE ($)
------------ -------------
CORPORATE NOTES & BONDS - (CONTINUED)
INDUSTRIALS - (CONTINUED)
Wal-Mart Stores, Inc.,
4.125% 02/15/11 1,020,000 1,016,858
Warner Music Group,
7.375% 04/15/14 (b) 130,000 129,350
Waste Management, Inc.,
7.375% 08/01/10 1,330,000 1,531,894
Westinghouse Air Brake Technology,
6.875% 07/31/13 200,000 200,500
Williams Companies, Inc.:
7.125% 09/01/11 30,000 32,850
8.125% 03/15/12 195,000 224,250
Wyeth,
6.700% 03/15/11 1,200,000 1,315,752
Yum! Brands, Inc.,
8.500% 04/15/06 250,000 271,777
-------------
Industrials Total 89,366,087
FINANCIALS - 12.8%
Allstate Financial Global Fund II,
2.625% 10/22/06 (b) 2,500,000 2,484,675
American General Finance Corp.,
5.375% 09/01/09 850,000 898,731
Bear Stearns Companies, Inc.,
6.500% 05/01/06 1,635,000 1,736,305
Capital One Bank,
4.875% 05/15/08 1,025,000 1,058,210
CIT Group, Inc.,
4.125% 02/21/06 1,060,000 1,083,108
Citigroup, Inc.,
7.250% 10/01/10 3,095,000 3,572,899
Countrywide Home Loan Bank,
2.875% 02/15/07 1,000,000 992,160
Extendicare Health Services:
6.875% 05/01/14 25,000 24,750
9.500% 07/01/10 15,000 16,725
Ford Motor Credit Co.,
7.375% 10/28/09 2,700,000 2,947,698
General Electric Capital Corp.,
6.750% 03/15/32 665,000 755,507
General Motors Acceptance Corp.,
7.750% 01/19/10 2,350,000 2,589,183
Genworth Financial, Inc.,
4.750% 06/15/09 1,500,000 1,549,515
Goldman Sachs Group, Inc.,
6.345% 02/15/34 1,550,000 1,553,348
Health Care Property Investors, Inc.,
6.450% 06/25/12 1,410,000 1,537,690
Household Finance Corp.,
6.400% 06/17/08 2,550,000 2,788,884
iStar Financial, Inc.:
5.125% 04/01/11 175,000 172,966
7.000% 03/15/08 150,000 161,062
8.750% 08/15/08 50,000 56,875
PAR ($) VALUE ($)
------------ -------------
JPMorgan Chase & Co.,
5.750% 01/02/13 2,545,000 2,687,393
Lehman Brothers Holdings, Inc.,
4.000% 01/22/08 1,000,000 1,016,000
Merrill Lynch & Co., Inc.,
4.125% 01/15/09 1,885,000 1,907,545
Morgan Stanley,
4.750% 04/01/14 1,530,000 1,476,052
SLM Corp.,
5.125% 08/27/12 2,000,000 2,034,440
US Bank NA,
6.375% 08/01/11 3,000,000 3,345,480
Wachovia Corp.,
3.500% 08/15/08 2,660,000 2,651,807
Wells Fargo & Co.,
5.900% 05/01/06 2,600,000 2,738,996
-------------
Financials Total 43,838,004
UTILITIES - 0.9%
Centerpoint Energy Houston,
5.750% 01/15/14 1,400,000 1,484,980
Exelon Generation Co. LLC,
6.950% 06/15/11 1,300,000 1,461,512
-------------
Utilities Total 2,946,492
INTERNATIONAL - 2.6%
Hydro-Quebec,
6.970% 03/01/05 1,000,000 1,022,140
Quebec Province,
7.000% 01/30/07 2,490,000 2,725,380
Republic of Italy,
2.500% 03/31/06 2,750,000 2,753,465
United Mexican States,
7.500% 04/08/33 2,390,000 2,521,450
-------------
International Total 9,022,435
TOTAL CORPORATE NOTES & BONDS
(Cost of $141,532,408) 145,173,018
OTHER SECURITIZED LOANS - 10.4%
ASSET-BACKED SECURITIES - 4.0%
Cityscape Home Equity Loan Trust,
Series 1997-4, Class A4,
7.440% 10/25/18 (a) 419,820 419,265
ContiMortgage Home Equity Loan Trust,
Series 1999-3, Class A6,
7.680% 12/25/29 (a) 1,946,732 2,018,430
IMC Home Equity Loan Trust:
Series 1995-3, Class A5,
7.500% 04/25/26 1,431,760 1,446,078
Series 1997-3, Class A6,
7.520% 08/20/28 1,459,258 1,461,389
Series 1997-5, Class A9,
7.310% 11/20/28 3,611,005 3,619,202
Nationslink Funding Corp.,
Series 1999-SL, Class A5,
6.888% 05/10/07 3,120,000 3,416,182
See Accompanying Notes to Financial Statements.
103
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA FIXED INCOME SECURITIES FUND
PAR ($) VALUE ($)
------------ -------------
OTHER SECURITIZED LOANS - (CONTINUED)
ASSET-BACKED SECURITIES - (CONTINUED)
New Century Home Equity Loan Trust,
Series 1999-NCA, Class A7,
7.320% 07/25/29 (a) 707,312 736,128
Salomon Brothers Mortgage
Securities VII, Inc.,
Series 1998-AQ1, Class A5,
7.150% 06/25/28 721,791 718,802
-------------
Asset-Backed Securities Total 13,835,476
COLLATERALIZED MORTGAGE OBLIGATIONS - 6.2%
Bear Stearns Asset-Backed Securities, Inc.,
Series 2002-AC5, Class 2A4,
5.000% 01/25/34 (a) 6,238,282 6,366,853
Bear Stearns Mortgage Securities, Inc.,
Series 1996-2, Class A1,
12.700% 01/28/25 (a) 10,031 10,010
Countrywide Alternative Loan Trust,
Series 2004-2CB, Class 1A4,
2.020% 03/25/34 (a) 3,994,149 3,992,661
Countrywide Home Loans, Inc.:
Series 2002-5, Class 2A1,
6.000% 04/25/17 785,830 790,443
Series 2003-49, Class A9,
4.648% 12/19/33 (a) 4,231,949 4,200,337
Credit Suisse First Boston
Mortgage Securities Corp.,
Series 2001-11, Class 1A3,
7.000% 06/25/31 178,204 178,517
IMPAC Secured Assets Common
Owner Trust,
Series 2002-3, Class A3,
6.360% 08/25/32 (a) 1,261,109 1,271,526
Structured Asset Securities Corp.,
Series 2003-21, Class 1A3,
5.500% 07/25/33 4,402,535 4,376,075
-------------
Collateralized Mortgage Obligations Total 21,186,422
COMMERCIAL MORTGAGE-BACKED SECURITIES - 0.2%
GMAC Commercial Mortgage Asset Corp.,
Series 2001-FLAA, Class B1,
2.100% 06/15/13 (a)(b) 675,416 675,499
-------------
Commercial Mortgage-Backed Securities Total 675,499
TOTAL OTHER SECURITIZED LOANS
(Cost of $35,150,020) 35,697,397
PAR ($) VALUE ($)
------------ -------------
SHORT-TERM OBLIGATIONS - 5.8%
U.S. TREASURY BILL - 3.1%
1.465% 11/04/04 10,790,000 10,762,330
-------------
REPURCHASE AGREEMENT - 2.7%
Repurchase agreement with State Street
Bank & Trust Co., dated 08/31/04,
due 09/01/04 at 1.500%, collateralized
by a U.S. Treasury Note maturing
06/15/09, market value $9,327,975
(repurchase proceeds $9,144,381) 9,144,000 9,144,000
-------------
TOTAL SHORT-TERM OBLIGATIONS
(Cost of $19,906,330) 19,906,330
TOTAL INVESTMENTS - 101.1%
(COST OF $338,874,943) (c) 345,374,379
OTHER ASSETS & LIABILITIES, NET - (1.1)% (4,104,816)
NET ASSETS - 100.0% 341,269,563
NOTES TO INVESTMENT PORTFOLIO:
(a) Variable rate security. The interest rate shown reflects the rate as of
August 31, 2004.
(b) Security exempt from registration pursuant to Rule 144A under the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers. At
August 31, 2004, these securities amounted to $9,223,436, which represents
2.7% of net assets
(c) Cost for federal income tax purposes is $339,657,708.
See Accompanying Notes to Financial Statements.
104
INVESTMENT PORTFOLIO ___________________________________________________________
AUGUST 31, 2004 COLUMBIA NATIONAL MUNICIPAL BOND FUND
PAR ($) VALUE ($)
------------ -------------
MUNICIPAL BONDS - 92.3%
ALASKA - 2.4%
Industrial Development & Export Authority,
Snettisham Hydroelectric, Series 1,
Insured AMBAC:
Pre-refunded (AMT),
5.500% 01/01/08 5,000 5,432
Unrefunded (AMT),
5.500% 01/01/08 95,000 103,579
Municipal Bond Bank Authority,
Series C,
Insured: MBIA,
5.500% 09/15/16 100,000 111,839
Palmer Valley Hospital Association,
Insured: RADIAN,
5.350% 12/01/12 125,000 141,510
-------------
Alaska Total 362,360
ARIZONA - 1.9%
Arizona State Transportation Board
Highway Revenue,
Series 2004 B,
5.000% 07/01/13 250,000 278,673
-------------
Arizona Total 278,673
ARKANSAS - 1.8%
Little Rock Waste Disposal Revenue,
Series 2002,
Insured: MBIA,
5.000% 05/01/16 250,000 268,580
-------------
Arkansas Total 268,580
CALIFORNIA - 3.3%
State Department of Water Resource,
Power Supply Revenue, Series 2002,
Insured: AMBAC,
5.000% 05/01/16 250,000 270,438
State Economic Recovery,
Series 2004 A,
Insured: MBIA,
5.000% 07/01/11 200,000 222,450
-------------
California Total 492,888
COLORADO - 0.1%
Housing Finance Authority,
Single Family,
4.875% 04/01/07 15,000 15,212
-------------
Colorado Total 15,212
FLORIDA - 1.9%
Orlando Utilities Commission,
Utility System Revenue,
5.250% 07/01/09 250,000 278,335
-------------
Florida Total 278,335
PAR ($) VALUE ($)
------------ -------------
IDAHO - 0.7%
Health Facilities Authority, Bingham
Memorial Hospital Project,
5.850% 03/01/19 100,000 100,262
-------------
Idaho Total 100,262
ILLINOIS - 8.2%
Chicago Motor Fuel Tax Revenue,
Series 2003 A,
Insured: AMBAC,
5.250% 01/01/17 250,000 274,415
Chicago Park District Aquarium
& Museum,
Insured: FGIC,
5.800% 01/01/18 150,000 167,976
Madison & St. Clair Counties, School
District No. 010, Collinsville
School Building,
Insured: FGIC,
5.500% 02/01/12 250,000 281,272
Regional Transportation Authority,
Series A,
Insured: AMBAC,
6.400% 06/01/12 100,000 118,778
State Educational Facilities Authority,
DePaul University, Series 2003 C,
Insured: AMBAC,
5.000% 09/01/18 250,000 265,285
Will County Forest Preservation District,
Series 1999 B,
Insured: FGIC,
(a) 12/01/11 150,000 114,369
-------------
Illinois Total 1,222,095
INDIANA - 3.6%
Board Bank Revenue,
Special Program, Hendricks,
Series 2002 D,
Insured: AMBAC,
5.375% 04/01/15 250,000 275,550
West Lafayette Industrial Building Corp.,
First Mortgage, Police Station Project,
Insured: FGIC,
5.000% 07/15/18 250,000 265,515
-------------
Indiana Total 541,065
IOWA - 2.7%
Finance Authority:
Health Care Facilities Revenue,
Genesis Medical Center,
Insured: MBIA,
6.100% 07/01/15 285,000 324,678
Single Family Mortgage,
Series A,
Insured: GNMA,
5.800% 07/01/16 70,000 73,612
-------------
Iowa Total 398,290
See Accompanying Notes to Financial Statements.
105
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA NATIONAL MUNICIPAL BOND FUND
PAR ($) VALUE ($)
------------ -------------
MUNICIPAL BONDS - (CONTINUED)
KENTUCKY - 1.9%
State Property & Buildings
Commission Revenues,
Series 2001,
5.250% 11/01/11 250,000 282,340
-------------
Kentucky Total 282,340
LOUISIANA - 1.9%
Calcasieu Parish School
District No. 31, Public
School Improvement,
Series 2000,
Insured: FGIC,
5.500% 05/01/16 250,000 277,930
-------------
Louisiana Total 277,930
MICHIGAN - 4.8%
State Hospital Finance Authority,
Ascension Health Credit, Series A:
5.375% 11/15/33 (b) 100,000 108,877
Insured: MBIA,
6.000% 11/15/19 100,000 116,314
State Trunk Line Fund,
Department of Treasury,
Insured: FGIC,
5.000% 09/01/14 185,000 205,816
Sturgis Public School District,
School Building & Site,
Insured: QSBLF,
5.500% 05/01/14 250,000 280,535
-------------
Michigan Total 711,542
MISSISSIPPI - 1.9%
Development Bank, Natchez
Convention Center Project,
Insured: AMBAC,
6.500% 07/01/13 230,000 280,073
-------------
Mississippi Total 280,073
MONTANA - 1.5%
Whitefish Tax Increment,
Urban Renewal Revenue,
6.625% 07/15/20 200,000 215,834
-------------
Montana Total 215,834
NEVADA - 1.9%
Colorado River Commission,
Hoover Dam Project, Series 2002,
Insured: FSA,
5.375% 10/01/14 250,000 282,942
-------------
Nevada Total 282,942
PAR ($) VALUE ($)
------------ -------------
NEW HAMPSHIRE - 1.7%
Health & Education Facilities
Authority, Concord Hospital
Revenue, Series 2004,
Insured: FGIC,
5.000% 10/01/12 230,000 253,251
-------------
New Hampshire Total 253,251
NEW YORK - 3.8%
New York City:
Series 2000,
Insured: AMBAC TCRS,
5.750% 08/01/11 250,000 285,535
Series A,
6.000% 05/15/21 250,000 273,242
-------------
New York Total 558,777
NORTH DAKOTA - 1.9%
Fargo School District Building Authority
Development, Series 2000,
Insured: MBIA,
5.500% 05/01/13 250,000 276,215
-------------
North Dakota Total 276,215
OHIO - 2.8%
Oak Hills Local School District,
Insured: MBIA,
7.200% 12/01/09 100,000 120,800
State Water Development Authority
Revenue, Fresh Water, Series 2001 B,
Insured: FSA,
5.500% 12/01/18 250,000 292,200
-------------
Ohio Total 413,000
OKLAHOMA - 1.5%
Okmulgee County,
1st Mortgage,
Insured: MBIA,
6.000% 03/01/15 200,000 223,996
-------------
Oklahoma Total 223,996
OREGON - 10.2%
Benton County Hospital
Facilities Authority Refunding,
Samaritan Health Services Project:
4.200% 10/01/05 40,000 40,998
4.600% 10/01/09 40,000 42,415
Clackamas County,
Hospital Facility Authority,
Gross-Willamette Falls Hospital Project,
Insured: RADIAN,
5.500% 04/01/22 250,000 265,077
Damascus Water District,
Certificates of Participation,
5.250% 03/01/19 100,000 109,710
See Accompanying Notes to Financial Statements.
106
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA NATIONAL MUNICIPAL BOND FUND
PAR ($) VALUE ($)
------------ -------------
MUNICIPAL BONDS - (CONTINUED)
OREGON - (CONTINUED)
Deschutes County Hospital Facilities
Authority, Cascade Health
Services, Inc., Series 2002,
5.600% 01/01/27 100,000 104,136
Eugene Trojan Nuclear Project,
5.900% 09/01/09 25,000 25,341
Hillsboro Hospital Facility Authority
Refunding, Tuality Healthcare,
5.250% 10/01/04 55,000 55,150
Klamath Community College District:
4.700% 04/01/10 55,000 58,369
4.800% 04/01/11 25,000 26,364
Lebanon Urban Renewal Agency,
5.625% 06/01/19 100,000 105,720
Port of St. Helens Pollution
Control, Portland General
Electric Co., Series B,
4.800% 06/01/10 105,000 104,972
Redmond Urban Renewal
Agency, Downtown Area B,
5.650% 06/01/13 100,000 104,086
Salem Hospital Facilities Authority,
Capital Manor, Inc., Series 1994,
7.500% 12/01/24 150,000 155,325
State Veterans Welfare,
Series 75,
5.875% 10/01/18 10,000 10,353
Washington & Clackamas Counties
School District No. 23J Tigard,
Series 2000,
(a) 06/15/21 300,000 133,770
West Linn Oregon Water System,
6.000% 10/01/20 165,000 176,103
Oregon Total 1,517,889
PUERTO RICO - 0.8%
Public Finance Corp.,
Series 2004 A,
Insured: AMBAC,
5.250% 08/01/30 (b) 110,000 122,278
-------------
Puerto Rico Total 122,278
SOUTH CAROLINA - 2.6%
Charleston County,
School District, Series 2001,
Insured: FSA,
5.000% 02/01/18 200,000 213,248
Charleston County,
Certificates of Participation,
Series 2004,
Insured: MBIA,
5.000% 12/01/10 150,000 165,517
-------------
South Carolina Total 378,765
PAR ($) VALUE ($)
------------ -------------
TENNESSEE - 4.4%
Lawrenceburg Public Building Authority,
Electric System Public Works,
Series C,
Insured: FSA,
5.500% 07/01/16 295,000 330,376
Metropolitan Government Nashville,
Series 2002 A,
Insured: AMBAC,
5.125% 10/01/13 285,000 316,293
-------------
Tennessee Total 646,669
TEXAS - 4.7%
Harris County Health Facilities,
de Teco Project, Series 1999 B,
Insured: AMBAC,
5.700% 02/15/15 150,000 168,372
Laredo Sports Venue Sales Tax,
Insured: FGIC,
5.750% 03/15/13 200,000 223,616
Magnolia Independent School District,
Insured: PSF-GTD,
5.250% 08/15/17 280,000 307,376
-------------
Texas Total 699,364
WASHINGTON - 13.1%
Grant County Public Hospital,
District No. 3,
Columbia Basin Hospital,
5.500% 12/01/18 170,000 176,610
Jefferson County,
Public Utility District No. 1,
Water & Sewer:
5.250% 05/01/16 50,000 52,568
5.250% 05/01/17 50,000 52,482
Poulsbo Water & Sewer,
5.250% 06/01/06 135,000 141,957
Seattle Municipal Light & Power:
5.000% 07/01/13 235,000 247,370
6.000% 10/01/16 150,000 167,574
Shelton Water & Sewer,
5.250% 12/01/18 50,000 52,392
State Certificates of
Participation, Department of
General Administration,
5.400% 07/01/13 100,000 106,908
State Health Care Facilities Authority
Revenue, Grays Harbor Community
Hospital, Series 1996,
Insured: RADIAN,
5.700% 07/01/16 200,000 213,342
See Accompanying Notes to Financial Statements.
107
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA NATIONAL MUNICIPAL BOND FUND
PAR ($) VALUE ($)
------------ -------------
MUNICIPAL BONDS - (CONTINUED)
WASHINGTON - (CONTINUED)
State Public Power Supply System:
Nuclear Project No. 1 Revenue,
Series 1997 B,
5.125% 07/01/14 300,000 316,500
Nuclear Project No. 2 Refunding,
Series A,
5.000% 07/01/11 50,000 54,126
Nuclear Project No. 3 Revenue,
Capital Appreciation, Series 1989 B,
(a) 07/01/12 145,000 105,795
Tacoma Solid Waste Utilities:
Pre-refunded, Series 1997 B,
Insured: AMBAC,
6.000% 12/01/09 15,000 17,348
Unrefunded, Series 1997 B,
Insured: AMBAC,
6.000% 12/01/09 85,000 97,667
Thurston County School
District No. 401, Rochester,
4.800% 12/01/07 55,000 55,307
Toppenish,
4.600% 12/01/06 65,000 68,381
Yakima County,
School District No. 119 Selah,
Insured: FGIC,
5.000% 12/01/06 10,000 10,680
-------------
Washington Total 1,937,007
WISCONSIN - 3.6%
Marshall School District,
Series 2002 A,
Insured: FGIC,
5.000% 03/01/14 250,000 278,158
State, Series 2004 2,
Insured: MBIA,
5.000% 05/01/12 225,000 250,070
-------------
Wisconsin Total 528,228
WYOMING - 0.7%
Municipal Power Agency, Power
Supply Refunding, Series 1998,
Insured: MBIA,
5.250% 01/01/11 100,000 110,757
-------------
Wyoming Total 110,757
TOTAL MUNICIPAL BONDS
(Cost of $12,999,099) 13,674,617
PAR ($) VALUE ($)
------------ -------------
SHORT-TERM OBLIGATIONS - 9.5%
VARIABLE RATE DEMAND NOTES (c) - 9.5%
FL Alachua County Health Facilities
Authority, Continuing Care,
Oak Hammock at the University
of Florida,
Series 2002 A,
1.350% 10/01/32 100,000 100,000
IL Quad Cities Regional
Economic Development Authority,
Two Rivers YMCA,
Series 2002,
1.400% 12/01/31 200,000 200,000
IN Health Facilities Financing Agency,
Fayette Memorial Hospital Association,
Series 2002 A,
1.400% 10/01/32 100,000 100,000
MS Jackson County Pollution Control
Revenue, Chevron Corp.,
Series 1992,
1.340% 12/01/16 200,000 200,000
NY New York City,
Series 1993,
1.320% 08/01/20 300,000 300,000
1.320% 08/01/21 300,000 300,000
WY Uinta County Pollution Control,
Chevron U.S.A., Inc.,
Series 1992,
1.340% 12/01/22 200,000 200,000
-------------
Variable Rate Demand Notes Total 1,400,000
TOTAL SHORT-TERM OBLIGATIONS
(Cost of $1,400,000) 1,400,000
TOTAL INVESTMENTS - 101.8%
(COST OF $14,399,099) (d) 15,074,617
OTHER ASSETS & LIABILITIES, NET - (1.8)% (262,814)
NET ASSETS - 100.0% 14,811,803
See Accompanying Notes to Financial Statements.
108
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA NATIONAL MUNICIPAL BOND FUND
NOTES TO INVESTMENT PORTFOLIO:
(a) Zero coupon bond.
(b) Variable rate security. The interest rate shown reflects the rate as of
August 31, 2004.
(c) Variable rate demand notes. These securities are payable upon demand and
are secured by letters of credit or other credit support agreements from
banks. The interest rates change periodically and the interest rates shown
reflect the rates as of August 31, 2004.
(d) Cost for federal income tax purposes is $14,395,525.
Columbia National Municipal Bond Fund holds investments that are insured by
private insurers who guarantee the payment of principal and interest in the
event of default. At August 31, 2004, investments in these securities
represented 61.5% of holdings.
ACRONYM NAME
------- ----
AMBAC American Municipal
Bond Assurance Corp.
AMT Alternative Minimum Tax
FGIC Federal Guaranty Insurance Corp.
FSA Financial Security Assurance Corp.
GNMA Government National Mortgage Association
MBIA Municipal Bond Insurance Association
PSF-GTD Permanent School Fund Guaranteed
QSBLF Qualified School Bond Loan Fund
RADIAN Radian Asset Assurance Inc.
TCRS Transferable Custodial Receipts
See Accompanying Notes to Financial Statements.
109
INVESTMENT PORTFOLIO ___________________________________________________________
AUGUST 31, 2004 COLUMBIA OREGON MUNICIPAL BOND FUND
PAR ($) VALUE ($)
------------ -------------
GENERAL OBLIGATION BONDS - 33.2%
STATE OF OREGON GENERAL OBLIGATIONS - 2.6%
Board of Higher Education:
Series A:
5.000% 08/01/12 2,075,000 2,310,077
5.250% 08/01/14 255,000 284,284
5.250% 08/01/16 780,000 856,658
Deferred Interest, Series A:
(a) 08/01/14 490,000 326,374
(a) 08/01/17 1,050,000 592,452
Elderly & Disabled Housing
Refunding, Series B:
4.950% 08/01/20 985,000 1,022,440
6.250% 08/01/13 55,000 55,214
State of Oregon, Series A,
5.250% 10/15/15 1,735,000 1,934,699
Veteran's Welfare:
5.850% 10/01/15 420,000 435,616
8.000% 07/01/08 580,000 696,354
9.200% 10/01/08 385,000 483,163
Series 80 A,
5.700% 10/01/32 2,490,000 2,566,792
-------------
State of Oregon General Obligations Total 11,564,123
GENERAL OBLIGATIONS - 14.1%
Aurora,
5.600% 06/01/24 1,205,000 1,254,754
Bend Municipal Airport Project,
Series B (AMT),
5.375% 06/01/13 150,000 159,567
Canyonville South Umpqua Rural
Fire District,
5.400% 07/01/31 610,000 636,425
Clackamas County:
Lake Oswego Series:
5.375% 06/01/15 2,450,000 2,725,478
5.375% 06/01/16 1,295,000 1,436,492
5.375% 06/01/17 2,535,000 2,811,974
Coos Bay,
4.900% 09/01/07 1,960,000 2,099,591
Crook County School District,
5.000% 02/01/14 2,860,000 3,127,095
Eugene Public Safety Facilities:
5.500% 06/01/10 850,000 901,127
5.625% 06/01/13 1,295,000 1,374,733
Lane County, School District No. 4J
Eugene, Refunding:
5.000% 07/01/12 1,000,000 1,115,730
5.250% 07/01/13 1,000,000 1,134,380
Metro Oregon,
5.250% 09/01/14 3,130,000 3,507,415
Metro Washington Park Zoo, Series A,
5.300% 01/15/11 1,000,000 1,070,960
PAR ($) VALUE ($)
------------ -------------
Portland Community College
District, Series A:
5.375% 06/01/14 1,925,000 2,159,138
5.375% 06/01/16 2,705,000 3,000,548
5.375% 06/01/17 2,540,000 2,817,520
Portland Limited Tax:
Series A:
3.400% 06/01/13 2,700,000 2,724,786
4.900% 04/01/12 1,430,000 1,505,704
5.750% 06/01/14 450,000 451,579
Series B:
(a) 06/01/12 1,750,000 1,302,123
(a) 06/01/13 1,500,000 1,056,060
(a) 06/01/16 3,500,000 2,098,810
(a) 06/01/18 4,000,000 2,148,960
(a) 06/01/19 4,000,000 2,030,480
(a) 06/01/20 4,000,000 1,915,520
Washington & Clackamas Counties:
Deferred Interest, Series A,
(a) 06/01/10 1,520,000 1,243,938
School District No. 23J, Tigard,
(a) 06/15/18 2,700,000 1,440,234
Washington County:
5.500% 06/01/16 2,785,000 3,115,357
Criminal Justice Facilities,
Refunding,
5.000% 12/01/10 1,400,000 1,510,964
School District No. 48J, Beaverton:
5.125% 01/01/14 2,000,000 2,198,240
5.125% 01/01/17 1,820,000 1,966,219
5.125% 01/01/18 2,260,000 2,441,568
Washington, Multnomah &
Yamhill Counties,
School District No. 1J:
5.000% 11/01/13 1,100,000 1,228,656
5.250% 06/01/14 500,000 549,670
-------------
General Obligations Total 62,261,795
INSURED GENERAL OBLIGATIONS - 16.5%
Benton & Linn Counties, School
District No. 509J, Corvallis,
Insured: FSA,
5.000% 06/01/17 2,665,000 2,886,568
Clackamas Community College,
Insured: FGIC,
5.250% 06/15/15 1,500,000 1,653,510
Clackamas County:
School District
School District No. 62,
Insured FSA,
3.250% 06/15/12 3,655,000 3,616,403
School District No. 108,
Insured FSA,
5.375% 06/15/15 1,055,000 1,174,226
No. 12, North Clackamas,
Insured: FGIC:
5.250% 06/01/11 1,000,000 1,101,670
5.250% 06/01/15 2,750,000 2,974,895
See Accompanying Notes to Financial Statements.
110
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA OREGON MUNICIPAL BOND FUND
PAR ($) VALUE ($)
------------ -------------
GENERAL OBLIGATION BONDS - (CONTINUED)
INSURED GENERAL OBLIGATIONS - (CONTINUED)
Columbia County, School District
No. 502, Deferred Interest,
Insured: FGIC:
(a) 06/01/13 1,685,000 1,194,480
(a) 06/01/14 1,025,000 691,352
Coos County, School District
No. 13, North Bend,
Insured: FSA,
5.500% 06/15/15 1,765,000 1,994,750
Deschutes County, School District
No. 1, Series A,
Insured: FSA,
5.500% 06/15/18 1,000,000 1,119,230
Jackson County:
School District No. 4, Phoenix-Talent,
Insured: FSA,
5.500% 06/15/16 1,000,000 1,119,230
School District No. 6, Central Point,
6.000% 06/15/09 1,090,000 1,247,091
School District No. 9, Eagle Point,
Insured: FSA,
5.625% 06/15/15 1,920,000 2,169,485
Jefferson County, School District
No. 509J, Madras School District,
Insured: FGIC,
5.250% 06/15/18 1,075,000 1,179,157
Josephine County, School District
No. 7, Grants Pass,
Insured: FSA,
4.000% 06/15/11 2,000,000 2,104,980
Lane County, School District No. 19,
Springfield Refunding,
Insured: FGIC:
6.000% 10/15/12 1,740,000 2,062,857
6.000% 10/15/14 1,310,000 1,573,690
Lincoln County School District,
Insured: FGIC,
5.600% 06/15/10 3,480,000 3,899,618
Linn Benton Community College,
Insured: FGIC:
(a) 06/15/13 1,000,000 700,040
(a) 06/15/14 1,000,000 665,090
Linn County, Community School
District No. 9, Lebanon,
Insured: FGIC:
5.250% 06/15/15 710,000 791,891
5.550% 06/15/21 2,000,000 2,225,500
Multnomah-Clackamas Counties:
Centennial School District
No. 28-302, Insured: FGIC:
5.375% 06/15/16 2,055,000 2,280,680
5.375% 06/15/17 2,280,000 2,530,390
5.375% 06/15/18 2,490,000 2,763,352
PAR ($) VALUE ($)
------------ -------------
Multnomah-Clackamas Counties,
School District No. 10JT, Series A,
Insured FSA,
5.250% 06/15/12 1,000,000 1,132,560
Multnomah County:
School District No. 7, Reynolds:
5.625% 06/15/14 2,670,000 3,034,241
5.625% 06/15/17 1,000,000 1,126,720
School District No. 40,
Insured: FSA,
5.000% 12/01/14 1,790,000 1,961,285
Northern Oregon Corrections,
Insured: AMBAC:
5.250% 09/15/12 1,000,000 1,084,570
5.300% 09/15/13 1,000,000 1,086,150
Salem-Keizer, School District No. 24J,
Insured: FSA,
5.000% 06/15/18 2,000,000 2,162,260
Washington & Clackamas Counties:
School District No. 003JT,
Insured FGIC,
(a) 06/15/17 6,000,000 3,361,080
School District No. 23J, Tigard,
Insured: FSA,
5.375% 06/15/17 1,500,000 1,671,345
Washington County:
School District No. 15, Forest Grove,
Insured: FSA:
5.375% 06/15/13 2,070,000 2,329,226
5.375% 06/15/15 2,515,000 2,799,220
Washington, Multnomah & Yamhill
Counties, School District No. 1J
Insured: MBIA,
5.000% 06/01/13 1,500,000 1,649,010
Yamhill County:
School District No. 029J,
Insured: MBIA,
5.250% 06/15/16 2,535,000 2,797,727
School District No. 40,
Insured: FGIC,
6.000% 06/01/09 500,000 573,310
-------------
Insured General Obligations Total 72,488,839
-------------
TOTAL GENERAL OBLIGATION BONDS
(Cost of $138,318,199) 146,314,757
REVENUE BONDS - 50.3%
OREGON REVENUE - 24.9%
Albany Hospital Facility Authority,
Mennonite Home Albany, Series PJ-A:
4.750% 10/01/11 (b) 660,000 684,862
5.000% 10/01/12 (b) 680,000 711,416
Benton County Hospital Facilities
Authority, Samaritan Health Services
Project, Refunding:
4.400% 10/01/07 220,000 231,724
4.800% 10/01/11 245,000 257,277
5.200% 10/01/17 2,255,000 2,339,698
See Accompanying Notes to Financial Statements.
111
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AUGUST 31, 2004 COLUMBIA OREGON MUNICIPAL BOND FUND
PAR ($) VALUE ($)
------------ -------------
REVENUE BONDS - (CONTINUED)
OREGON REVENUE - (CONTINUED)
Clackamas County Hospital
Facility Authority:
Legacy Health System:
4.600% 05/01/10 885,000 948,242
5.000% 02/15/16 1,010,000 1,056,783
5.500% 02/15/13 5,450,000 5,940,064
5.500% 02/15/14 2,385,000 2,589,943
5.750% 05/01/12 2,000,000 2,265,960
Legacy Health System, Refunding:
5.250% 05/01/21 4,890,000 5,128,485
5.750% 05/01/16 1,500,000 1,662,780
Odd Fellows Home, Series A,
Refunding,
5.875% 09/15/21 705,000 637,355
Robison Jewish Home Project,
6.250% 10/01/21 1,650,000 1,727,401
Willamette Falls Hospital Project,
5.750% 04/01/14 705,000 737,846
Willamette View, Inc. Project,
Series A,
6.850% 11/01/15 1,580,000 1,701,897
Clackamas County Housing Authority,
Multi-Family Housing, Easton Ridge,
Series A,
5.800% 12/01/16 2,255,000 2,313,292
Deschutes County Hospital Facilities
Authority, Cascade Health
Services, Inc.:
5.500% 01/01/22 2,000,000 2,107,020
5.600% 01/01/27 5,550,000 5,779,548
5.600% 01/01/32 2,000,000 2,075,260
Deschutes Valley Water District,
5.875% 09/01/05 1,585,000 1,645,658
Eugene Airport, Refunding (AMT):
5.650% 05/01/06 325,000 341,403
5.650% 05/01/07 555,000 594,211
5.700% 05/01/08 515,000 558,126
Multnomah County Educational Facilities,
University of Portland Project:
5.700% 04/01/15 1,000,000 1,067,260
6.000% 04/01/20 1,000,000 1,088,100
6.000% 04/01/25 500,000 525,315
Multnomah County Hospital Facilities
Authority Revenue, Providence
Health System,
5.250% 10/01/16 2,970,000 3,259,961
Myrtle Point Water,
6.000% 12/01/20 510,000 545,124
Oregon State Economic Development,
Dove Lewis 24 Hour Emergency
Animal Hospital,
7.000% 12/01/19 (c) 1,380,000 1,420,544
PAR ($) VALUE ($)
------------ -------------
Oregon State Health, Housing,
Educational & Cultural
Facilities Authority:
Authority/Aquarium:
4.750% 10/01/08 (d) 1,550,000 325,500
4.900% 10/01/09 (d) 670,000 140,700
Goodwill Industries Lane
County, Series A,
6.650% 11/15/22 (c) 3,855,000 3,730,291
Linfield College Project, Series A:
4.650% 10/01/09 555,000 583,455
5.500% 10/01/18 1,000,000 1,038,020
Reed College Project, Series A,
5.300% 07/01/11 500,000 536,820
St. Anthony's Village Housing,
Series A (AMT),
7.250% 06/01/28 1,360,000 1,342,714
Oregon State Housing &
Community Services,
Department of Mortgage Revenue,
Single Family Mortgage Program:
Series A,
4.850% 07/01/10 180,000 191,979
Series D,
6.700% 07/01/13 615,000 616,082
Series E,
5.375% 07/01/21 3,435,000 3,608,536
Series H (AMT),
5.500% 07/01/17 1,195,000 1,241,533
Series J,
5.150% 07/01/24 2,770,000 2,853,626
Series M (AMT),
5.800% 07/01/12 265,000 281,926
Series Q:
4.700% 07/01/15 750,000 787,852
4.900% 07/01/17 735,000 771,302
Mountain Shadows Apts. B-1,
6.250% 12/01/05 (d) 3,937,414 2,994,167
Port Morrow,
6.700% 06/01/20 2,000,000 2,029,760
Port of St. Helens:
5.600% 08/01/14 315,000 326,082
5.750% 08/01/19 425,000 439,705
Port of St. Helens Pollution Control,
Portland General Electric Co.:
Series A,
4.800% 04/01/10 5,195,000 5,162,168
Series B,
4.800% 06/01/10 3,500,000 3,499,055
Powell Valley Water District,
6.000% 02/01/15 620,000 664,566
Reedsport Water,
7.000% 10/01/14 520,000 521,383
Salem Hospital Facility Authority:
5.000% 08/15/18 2,000,000 2,060,860
5.250% 08/15/14 4,860,000 5,153,787
See Accompanying Notes to Financial Statements.
112
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA OREGON MUNICIPAL BOND FUND
PAR ($) VALUE ($)
------------ -------------
REVENUE BONDS - (CONTINUED)
OREGON REVENUE - (CONTINUED)
Sheridan Water Revenue:
6.200% 05/01/15 625,000 674,025
6.450% 05/01/20 520,000 562,089
Sheridan Water Revenue, Refunding,
5.350% 04/01/18 300,000 312,249
State of Oregon French American
International School Project, Series A,
6.250% 04/01/27 5,270,000 5,320,803
Umatilla County, Hospital Facility
Authority, Catholic Health Initiatives,
Series A:
5.750% 12/01/20 530,000 568,690
6.000% 12/01/30 4,825,000 5,176,887
Washington County Housing Authority:
Affordable Housing, Series A,
6.000% 07/01/20 2,000,000 2,051,080
Affordable Housing Pool, Series A:
5.750% 07/01/23 1,000,000 1,022,660
6.000% 07/01/23 1,000,000 1,031,490
-------------
Oregon Revenue Total 109,564,397
INSURED REVENUE - 25.4%
Clackamas County, Hospital Facilities
Authority, Legacy Health System,
Insured: MBIA,
5.500% 02/15/13 495,000 551,762
Deschutes County, Certificates of
Participation, Series A,
5.050% 06/01/17 420,000 429,752
Emerald Peoples Utilities District,
Insured: FGIC:
7.350% 11/01/10 2,160,000 2,675,938
7.350% 11/01/11 2,000,000 2,514,400
7.350% 11/01/12 2,490,000 3,178,510
7.350% 11/01/13 2,675,000 3,462,573
Series A,
Insured: FSA,
5.250% 11/01/20 605,000 660,581
Eugene Electric Utilities System,
Series B, Refunding,
Insured: FSA,
5.250% 08/01/13 1,040,000 1,159,434
Guam Housing Corp., Single
Family Mortgage-Backed Securities,
Insured: FHA,
Series A (AMT),
5.750% 09/01/31 175,000 191,033
Medford Hospital Facilities Authority,
Asante Health System, Series A,
Insured: MBIA:
5.250% 08/15/10 1,500,000 1,648,590
5.250% 08/15/11 800,000 875,400
PAR ($) VALUE ($)
------------ -------------
Multnomah County Educational Facilities
Authority, University of Portland
Project, Refunding,
Insured: AMBAC:
5.000% 04/01/11 1,150,000 1,248,796
5.750% 04/01/10 2,000,000 2,212,960
Ontario Catholic Health Holy Rosary
Medical Center,
Insured MBIA,
5.500% 11/15/12 1,500,000 1,592,685
Oregon State Department of
Administrative Services:
Certificates of Participation,
Series A,
Insured: AMBAC:
4.500% 05/01/12 1,020,000 1,078,528
5.000% 05/01/13 4,240,000 4,641,994
5.000% 05/01/14 1,000,000 1,091,200
5.300% 05/01/08 750,000 816,090
Series B,
Insured: MBIA,
5.250% 05/01/10 840,000 939,641
Series C,
Insured: MBIA:
5.250% 11/01/15 1,000,000 1,107,830
5.250% 11/01/17 5,000,000 5,510,550
Series E,
Insured FSA,
5.000% 11/01/13 1,470,000 1,618,029
Lottery Education Project:
Series A,
Insured: FSA:
5.000% 04/01/14 2,830,000 3,139,072
5.250% 04/01/11 4,000,000 4,427,960
Series B,
Insured: FSA,
5.250% 04/01/15 1,315,000 1,430,891
Oregon State Economic Community
Development Department, Series A,
Insured: MBIA,
5.375% 01/01/11 1,105,000 1,226,683
Oregon State Health, Housing,
Educational & Cultural
Facilities Authority,
Reed College Project, Series A,
Insured: MBIA,
5.100% 07/01/10 900,000 993,321
Oregon State Health Sciences
University, Series A,
Insured: MBIA:
(a) 07/01/09 1,530,000 1,323,022
(a) 07/01/12 1,315,000 980,306
(a) 07/01/14 2,550,000 1,709,877
(a) 07/01/15 4,325,000 2,740,623
(a) 07/01/21 12,515,000 5,604,342
See Accompanying Notes to Financial Statements.
113
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AUGUST 31, 2004 COLUMBIA OREGON MUNICIPAL BOND FUND
PAR ($) VALUE ($)
------------ -------------
REVENUE BONDS - (CONTINUED)
INSURED REVENUE - (CONTINUED)
Oregon State Housing &
Community Services:
Department of Housing Finance
Revenue, Assisted Insured
Multi-Unit, Series B,
Insured: FHA,
6.800% 07/01/13 7,250,000 7,263,195
Department of Mortgage Revenue,
Single Family Mortgage Program:
Series E,
Insured: FHA:
5.700% 07/01/12 815,000 844,927
5.800% 07/01/14 720,000 747,180
6.000% 07/01/20 2,015,000 2,095,217
Series F, (AMT),
Insured: MBIA-IBC,
5.600% 07/01/28 845,000 866,733
Oregon State Housing Finance,
Insured: FHA,
5.800% 07/01/09 180,000 181,418
Port of Portland International Airport,
Insured: FGIC:
Series 12B,
5.250% 07/01/12 1,000,000 1,090,520
Series D,
5.250% 07/01/12 1,750,000 1,906,065
Portland Arena Gas Tax,
Insured: FSA:
(a) 06/01/16 1,100,000 570,405
(a) 06/01/17 2,320,000 1,125,780
Portland Gas Tax, Series A,
Insured FSA,
5.800% 06/01/16 1,640,000 1,743,287
Portland River District Urban Renewal
& Redevelopment, Series A,
Insured: AMBAC:
5.000% 06/15/17 1,500,000 1,619,370
5.000% 06/15/18 3,070,000 3,293,066
5.000% 06/15/20 2,000,000 2,114,940
Portland Sewer System Revenue,
Series A, Refunding,
Insured FGIC,
5.000% 06/01/12 4,835,000 5,177,560
Portland Urban Renewal
& Redevelopment:
Convention Center, Series A,
Insured: AMBAC:
5.750% 06/15/17 1,500,000 1,699,380
5.750% 06/15/18 2,050,000 2,322,486
South Park Blocks,
Series A,
Insured: AMBAC:
5.750% 06/15/17 2,065,000 2,339,480
5.750% 06/15/19 2,580,000 2,922,934
PAR ($) VALUE ($)
------------ -------------
Tri-County Metropolitan
Transportation District:
Series 1,
5.400% 06/01/19 4,200,000 4,428,018
Series A,
5.000% 09/01/15 1,000,000 1,091,020
Tualatin Hills Park &
Recreation District,
Insured: FGIC,
5.750% 03/01/14 990,000 1,159,805
Washington County:
Clean Water Services Sewer,
Series Lien,
Insured: MBIA,
5.000% 10/01/13 2,310,000 2,579,462
-------------
Insured Revenue Total 111,964,621
-------------
TOTAL REVENUE BONDS
(Cost of $213,317,871) 221,529,018
PRE-REFUNDED BONDS - 10.5%
Clackamas County:
School District No. 62,
5.375% 06/15/17 1,250,000 1,412,650
School District No. 086,
6.000% 06/15/16 2,350,000 2,684,405
Clackamas County Hospital
Facility Authority,
Kaiser Permanente, Series A,
5.375% 04/01/14 7,135,000 7,946,892
Josephine County, School District
No. 7, Grants Pass,
Insured: FGIC,
5.700% 06/01/13 2,000,000 2,194,720
Multnomah County, Series A,
Insured: FSA,
5.500% 04/01/19 2,395,000 2,648,750
North Clackamas Parks & Recreation
District Facilities,
5.700% 04/01/13 2,920,000 3,299,863
Northern Wasco County,
People's Utility District Electric:
(a) 02/01/06 610,000 568,935
(a) 02/01/07 585,000 510,822
(a) 02/01/08 610,000 497,717
(a) 02/01/11 500,000 332,840
Oregon State Board of Higher Education,
Series A:
5.250% 08/01/14 1,225,000 1,383,160
5.250% 08/01/16 4,550,000 5,137,451
Oregon State City Sewer,
6.500% 10/01/07 500,000 520,590
See Accompanying Notes to Financial Statements.
114
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AUGUST 31, 2004 COLUMBIA OREGON MUNICIPAL BOND FUND
PAR ($) VALUE ($)
------------ -------------
PRE-REFUNDED BONDS - (CONTINUED)
Oregon State Department of
Administrative Services,
Lottery Education Project,
Series A,
Insured: FSA:
5.000% 04/01/14 2,705,000 3,003,767
5.250% 04/01/13 1,600,000 1,791,840
Oregon State Department of
Transportation, Highway User Tax,
Series A,
5.500% 11/15/16 2,500,000 2,882,700
Salem-Keizer, School District No. 24J:
5.000% 06/01/15 1,000,000 1,102,790
5.000% 06/01/16 1,380,000 1,521,850
Salem Water & Sewer,
Insured FSA,
5.300% 06/01/15 1,500,000 1,644,840
Virgin Islands Public Finance Authority,
Unrefunded Balance, Series A,
7.300% 10/01/18 1,185,000 1,554,045
Washington County:
School District No. 48J, Beaverton:
Insured: FGIC:
5.100% 06/01/12 500,000 547,205
5.250% 08/01/10 1,150,000 1,261,228
School District No. 088J,
Sherwood,
Insured: FSA,
6.100% 06/01/12 185,000 191,407
Unified Sewer Agency,
Insured: FGIC,
5.500% 10/01/16 1,250,000 1,357,525
-------------
TOTAL PRE-REFUNDED BONDS
(Cost of $42,159,520) 45,997,992
OTHER BONDS - 2.8%
Hood River Urban Renewal Agency,
6.250% 12/15/11 1,250,000 1,345,150
Lebanon Urban Renewal Agency:
5.625% 06/01/19 1,000,000 1,057,200
5.750% 06/01/15 1,120,000 1,175,384
6.000% 06/01/20 1,580,000 1,672,904
Medford Urban Renewal,
5.875% 09/01/10 500,000 523,370
Multnomah County, Certificates
of Participation,
4.550% 08/01/10 1,000,000 1,066,590
Redmond Urban Renewal Agency:
Downtown Area B:
5.650% 06/01/13 720,000 749,419
5.850% 06/01/19 785,000 814,202
South Airport Industrial Area A,
5.700% 06/01/19 650,000 662,097
PAR ($) VALUE ($)
------------ -------------
OTHER BONDS - (CONTINUED)
Seaside Urban Renewal Agency, Greater
Seaside Urban Renewal,
5.250% 06/01/15 1,000,000 1,037,080
Veneta Urban Renewal Agency:
5.375% 02/15/16 700,000 741,440
5.625% 02/15/21 1,100,000 1,156,397
Wilsonville Limited Tax Improvement,
5.000% 12/01/10 345,000 347,105
-------------
TOTAL OTHER BONDS
(Cost of $11,596,624) 12,348,338
U.S. TERRITORIES BONDS - 0.4%
Puerto Rico, Series A,
5.000% 07/01/30 1,000,000 1,083,760
Puerto Rico Housing Finance Corp.,
Multi-Family Mortgage Portfolio A-1,
Insured: FHA,
7.500% 04/01/22 805,000 814,145
-------------
TOTAL U.S. TERRITORIES BONDS
(Cost of $1,855,134) 1,897,905
SHORT-TERM OBLIGATIONS - 1.9%
VARIABLE RATE DEMAND NOTES (e) - 1.9%
Farmington, New Mexico, Pollution
Control Revenue, Arizona Public
Service Company, Series B,
1.350% 09/01/24 300,000 300,000
Idaho Health Facilities Authority Revenue,
St. Lukes Regional Medical
Center Project,
1.350% 05/01/22 1,500,000 1,500,000
Illinois Health Facilities Authority Revenue,
OSF Healthcare System,
1.330% 11/15/27 900,000 900,000
Indiana Health Facility Financing
Authority Revenue, Golden Years
Homestead, Series A,
1.320% 06/01/25 2,300,000 2,300,000
Jackson County, Mississippi Pollution
Control Revenue, Chevron USA,
Inc., Project,
1.350% 01/01/23 1,200,000 1,200,000
New York City Municipal Water Finance
Authority, Water & Sewer System
Revenue, Series C,
1.330% 06/15/24 500,000 500,000
Quad Cities Regulation Economic
Development Authority Revenue,
Two River YMCA Project,
1.400% 12/01/31 100,000 100,000
See Accompanying Notes to Financial Statements.
115
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA OREGON MUNICIPAL BOND FUND
PAR ($) VALUE ($)
------------ -------------
SHORT-TERM OBLIGATIONS - (CONTINUED)
VARIABLE RATE DEMAND NOTES (e) - (CONTINUED)
Uinta County, Wyoming Pollution
Control Revenue, Chevron USA,
Inc., Project,
1.350% 12/01/22 1,500,000 1,500,000
-------------
Variable Rate Demand Notes Total 8,300,000
TOTAL SHORT-TERM OBLIGATIONS
(Cost of $8,300,000) 8,300,000
TOTAL INVESTMENTS - 99.1%
(COST OF $415,547,348) (f) 436,388,010
OTHER ASSETS & LIABILITIES, NET - 0.9% 4,059,970
NET ASSETS - 100.0% 440,447,980
NOTES TO INVESTMENT PORTFOLIO:
(a) Zero coupon bond.
(b) Security purchased on a delayed delivery basis.
(c) Denotes a restricted security, which is subject to restrictions on resale
under federal securities laws. At August 31, 2004, the value of these
securities amounted to $5,150,835, which represents 1.2% of net assets.
ACQUISITION ACQUISITION
SECURITY DATE COST
-------- ------------ -------------
Oregon State Economic Development,
Dove Lewis 24 Hour Emergency
Animal Hospital,
7.000% 12/01/19 12/11/03 $ 1,380,000
Oregon State Health, Housing,
Educational & Cultural Facilities
Authority, Goodwill Industries
Lane County, Series A,
6.650% 11/15/22 06/18/02 3,855,000
-------------
$ 5,235,000
=============
(d) This issuer is in default of certain debt covenants. Income is not being
accrued.
(e) Variable rate demand notes. These securities are payable upon demand and are
secured by letters of credit or other credit support agreements from banks.
The interest rates change periodically and the interest rates shown reflect
the rates as of August 31, 2004.
(f) Cost for federal income tax purposes is $415,441,114.
Columbia Oregon Municipal Bond Fund holds investments that are insured by
private insurers who guarantee the payment of principal and interest in the
event of default. At August 31, 2004, investments in these securities
represented 43.2% of holdings.
ACRONYM NAME
------- ----
AMBAC American Municipal
Bond Assurance Corp.
AMT Alternative Minimum Tax
FGIC Federal Guaranty Insurance Corp.
FHA Federal Housing Administration
FSA Financial Security Assurance Corp.
IBC Insured Bond Certificates
MBIA Municipal Bond Insurance Association
See Accompanying Notes to Financial Statements.
116
INVESTMENT PORTFOLIO ___________________________________________________________
AUGUST 31, 2004 COLUMBIA HIGH YIELD FUND
PAR ($) VALUE ($)
------------ -------------
CORPORATE NOTES & BONDS - 91.6%
AEROSPACE & DEFENSE - 3.9%
K&F Industries,
9.625% 12/15/10 14,645,000 16,255,950
L-3 Communications Corp.:
6.125% 07/15/13 1,375,000 1,364,687
7.625% 06/15/12 30,275,000 32,772,687
TransDigm, Inc.,
8.375% 07/15/11 15,275,000 16,115,125
-------------
Aerospace & Defense Total 66,508,449
AMUSEMENT & RECREATION - 4.5%
Cinemark USA, Inc.,
9.000% 02/01/13 21,740,000 24,185,750
Royal Caribbean Cruises Ltd.:
6.750% 03/15/08 5,325,000 5,564,625
6.875% 12/01/13 6,150,000 6,319,125
8.000% 05/15/10 2,495,000 2,775,687
8.750% 02/02/11 18,890,000 21,817,950
Speedway Motorsports, Inc.,
6.750% 06/01/13 16,983,000 17,492,490
-------------
Amusement & Recreation Total 78,155,627
BROADCASTING - 2.0%
LIN Television Corp.,
6.500% 05/15/13 14,150,000 13,973,125
Sinclair Broadcasting Group, Inc.:
8.000% 03/15/12 12,710,000 13,091,300
8.750% 12/15/11 6,710,000 7,246,800
-------------
Broadcasting Total 34,311,225
CABLE TV - 5.5%
DirecTV Holdings LLC,
8.375% 03/15/13 24,260,000 27,595,750
EchoStar DBS Corp.,
5.750% 10/01/08 33,925,000 34,094,625
Rogers Cable, Inc.:
6.250% 06/15/13 17,950,000 17,500,712
7.875% 05/01/12 15,350,000 16,578,461
-------------
Cable TV Total 95,769,548
CAPITAL GOODS - 1.8%
Kennametal, Inc.,
7.200% 06/15/12 15,195,000 16,528,361
Wabtec,
6.875% 07/31/13 14,875,000 14,912,187
-------------
Capital Goods Total 31,440,548
CASINOS & GAMING - 8.1%
Harrah's Operating Co., Inc.,
7.875% 12/15/05 25,400,000 26,828,750
Kerzner International Ltd.,
8.875% 08/15/11 7,700,000 8,450,750
MGM Mirage, Inc.:
6.000% 10/01/09 13,375,000 13,642,500
9.750% 06/01/07 20,050,000 22,330,687
PAR ($) VALUE ($)
------------ -------------
Park Place Entertainment Corp.:
7.875% 03/15/10 150,000 165,750
8.875% 09/15/08 750,000 847,500
9.375% 02/15/07 30,150,000 33,466,500
Station Casinos, Inc.:
6.500% 02/01/14 21,480,000 21,372,600
6.875% 03/01/16 13,415,000 13,381,463
-------------
Casinos & Gaming Total 140,486,500
CHEMICALS - 4.7%
Acetex Corp.,
10.875% 08/01/09 8,965,000 9,861,500
Airgas, Inc.,
9.125% 10/01/11 16,358,000 18,382,303
Equistar Chemicals LP:
10.125% 09/01/08 7,370,000 8,180,700
10.625% 05/01/11 4,805,000 5,381,600
Ethyl Corp.,
8.875% 05/01/10 16,400,000 17,589,000
MacDermid, Inc.,
9.125% 07/15/11 9,520,000 10,626,700
Nalco Co.,
7.750% 11/15/11 (a) 10,170,000 10,805,625
-------------
Chemicals Total 80,827,428
CONSUMER PRODUCTS - 2.9%
Hasbro, Inc.,
6.150% 07/15/08 17,420,000 18,421,650
K2, Inc.,
7.375% 07/01/14 (a) 8,380,000 8,810,900
Scotts Co.,
6.625% 11/15/13 21,530,000 22,391,200
-------------
Consumer Products Total 49,623,750
DIVERSIFIED MEDIA - 2.4%
Lamar Media Corp.,
7.250% 01/01/13 31,203,000 33,075,180
Warner Music Group,
7.375% 04/15/14 (a) 8,405,000 8,362,975
-------------
Diversified Media Total 41,438,155
ENERGY - 10.9%
Chesapeake Energy Corp.:
7.500% 09/15/13 10,120,000 10,904,300
8.125% 04/01/11 3,050,000 3,347,375
8.375% 11/01/08 6,460,000 7,057,550
9.000% 08/15/12 8,750,000 9,975,000
Grant Prideco, Inc.:
9.000% 12/15/09 14,995,000 16,644,450
9.625% 12/01/07 12,520,000 14,022,400
Key Energy Services, Inc.,
6.375% 05/01/13 4,290,000 4,096,950
Newfield Exploration Co.,
6.625% 09/01/14 (a) 13,100,000 13,362,000
Offshore Logistics, Inc.,
6.125% 06/15/13 20,800,000 20,592,000
Plains E&P Co.,
7.125% 06/15/14 (a) 12,910,000 13,684,600
See Accompanying Notes to Financial Statements.
117
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA HIGH YIELD FUND
PAR ($) VALUE ($)
------------ -------------
CORPORATE NOTES & BONDS - (CONTINUED)
ENERGY - (CONTINUED)
Pogo Producing Co.,
8.250% 04/15/11 3,080,000 3,380,300
Pride International, Inc.,
7.375% 07/15/14 (a) 14,505,000 15,411,562
Suburban Propane Partners LP,
6.875% 12/15/13 9,675,000 9,675,000
Universal Compression, Inc.,
7.250% 05/15/10 16,245,000 16,976,025
Vintage Petroleum, Inc.:
7.875% 05/15/11 7,150,000 7,489,625
8.250% 05/01/12 6,025,000 6,567,250
Williams Companies, Inc.:
7.125% 09/01/11 1,935,000 2,118,825
8.125% 03/15/12 11,845,000 13,621,750
-------------
Energy Total 188,926,962
ENVIRONMENTAL - 2.5%
Allied Waste North America, Inc.:
6.375% 04/15/11 10,375,000 10,271,250
6.500% 11/15/10 7,875,000 7,894,688
Series B:
7.375% 04/15/14 13,825,000 13,410,250
9.250% 09/01/12 2,300,000 2,587,500
Synagro Technologies, Inc.,
9.500% 04/01/09 8,375,000 8,814,688
-------------
Environmental Total 42,978,376
FOOD, BEVERAGE & TOBACCO - 3.5%
Constellation Brands, Inc.:
8.000% 02/15/08 3,750,000 4,134,375
8.125% 01/15/12 17,465,000 19,080,512
8.625% 08/01/06 5,100,000 5,578,125
Cott Beverages, Inc.,
8.000% 12/15/11 29,250,000 31,590,000
-------------
Food, Beverage & Tobacco Total 60,383,012
FOOD & DRUG RETAIL - 1.0%
Couche-Tard,
7.500% 12/15/13 16,480,000 17,386,400
-------------
Food & Drug Retail Total 17,386,400
HEALTH CARE - 8.1%
AmerisourceBergen Corp.:
7.250% 11/15/12 6,630,000 7,094,100
8.125% 09/01/08 17,375,000 19,069,063
Extendicare Health Services, Inc.:
6.875% 05/01/14 1,600,000 1,584,000
9.500% 07/01/10 1,280,000 1,427,200
Fisher Scientific International, Inc.,
6.750% 08/15/14 (a) 2,570,000 2,647,100
HCA, Inc.:
6.910% 06/15/05 7,025,000 7,220,716
7.000% 07/01/07 1,000,000 1,071,370
8.750% 09/01/10 7,000,000 8,192,380
PAR ($) VALUE ($)
------------ -------------
Omnicare, Inc.:
6.125% 06/01/13 10,575,000 10,257,750
Series B,
8.125% 03/15/11 14,740,000 15,771,800
Province Healthcare Co.,
7.500% 06/01/13 12,800,000 14,240,000
Select Medical Corp.:
7.500% 08/01/13 11,050,000 11,464,375
9.500% 06/15/09 12,625,000 13,729,688
Triad Hospitals, Inc.:
7.000% 05/15/12 24,453,000 25,431,120
7.000% 11/15/13 1,365,000 1,371,825
-------------
Health Care Total 140,572,487
HOMEBUILDERS - 2.9%
KB Home:
7.750% 02/01/10 5,150,000 5,510,500
8.625% 12/15/08 6,325,000 7,036,562
9.500% 02/15/11 12,250,000 13,689,375
Toll Brothers, Inc.,
8.250% 02/01/11 3,200,000 3,484,000
Toll Corp.:
8.000% 05/01/09 5,765,000 5,995,600
8.250% 12/01/11 12,770,000 14,110,850
-------------
Homebuilders Total 49,826,887
HOTELS - 1.0%
ITT Corp.,
6.750% 11/15/05 6,055,000 6,289,631
Starwood Hotels & Resorts
Worldwide, Inc.:
7.375% 05/01/07 5,300,000 5,743,875
7.875% 05/01/12 5,000,000 5,625,000
-------------
Hotels Total 17,658,506
METALS & MINING - 3.5%
Arch Western Finance LLC,
7.500% 07/01/13 (a) 28,790,000 29,797,650
Peabody Energy Corp.:
5.875% 04/15/16 2,775,000 2,650,125
6.875% 03/15/13 26,655,000 27,987,750
-------------
Metals & Mining Total 60,435,525
NON-FOOD & DRUG RETAIL - 1.6%
Autonation, Inc.,
9.000% 08/01/08 14,230,000 16,257,775
Finlay Fine Jewelry Corp.,
8.375% 06/01/12 (a) 4,525,000 4,819,125
Group 1 Automotive, Inc.,
8.250% 08/15/13 6,745,000 7,048,525
-------------
Non-Food & Drug Retail Total 28,125,425
PACKAGING - 3.9%
Ball Corp.:
6.875% 12/15/12 32,897,000 34,377,365
7.750% 08/01/06 2,850,000 3,049,500
Owens-Brockway Glass Container,
8.875% 02/15/09 7,225,000 7,857,187
See Accompanying Notes to Financial Statements.
118
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA HIGH YIELD FUND
PAR ($) VALUE ($)
------------ -------------
CORPORATE NOTES & BONDS - (CONTINUED)
PACKAGING - (CONTINUED)
Owens-Illinois, Inc.,
8.100% 05/15/07 410,000 431,525
Silgan Holdings, Inc.,
6.750% 11/15/13 22,380,000 22,380,000
-------------
Packaging Total 68,095,577
PAPER PRODUCTS - 1.5%
Smurfit-Stone Container Corp.:
8.250% 10/01/12 4,580,000 4,992,200
8.375% 07/01/12 5,185,000 5,677,575
9.750% 02/01/11 13,875,000 15,505,313
-------------
Paper Products Total 26,175,088
PRINTING & PUBLISHING - 3.5%
Dex Media East LLC,
12.125% 11/15/12 13,253,000 16,301,190
Houghton Mifflin Co.,
9.875% 02/01/13 8,105,000 8,429,200
R.H. Donnelly Finance Corp.:
8.875% 12/15/10 (a) 1,320,000 1,485,000
10.875% 12/15/12 8,150,000 9,657,750
10.875% 12/15/12(a) 21,445,000 25,412,325
-------------
Printing & Publishing Total 61,285,465
REAL ESTATE INVESTMENT TRUST (REIT) - 1.4%
iStar Financial, Inc.:
6.000% 12/15/10 2,400,000 2,454,000
7.000% 03/15/08 7,900,000 8,482,625
8.750% 08/15/08 5,767,000 6,559,962
Series B,
5.125% 04/01/11 7,350,000 7,264,586
-------------
Real Estate Investment Trust (REIT) Total 24,761,173
SERVICES - 5.1%
Corrections Corp. of America:
7.500% 05/01/11 29,400,000 30,943,500
9.875% 05/01/09 275,000 306,969
Iron Mountain, Inc.:
7.750% 01/15/15 7,250,000 7,540,000
8.250% 07/01/11 1,120,000 1,163,400
8.625% 04/01/13 24,550,000 26,514,000
United Rentals, Inc.:
7.000% 02/15/14 12,000,000 10,740,000
7.750% 11/15/13 11,215,000 10,429,950
-------------
Services Total 87,637,819
SHIPPING - 1.8%
Teekay Shipping Corp.,
8.875% 07/15/11 27,626,000 30,802,990
-------------
Shipping Total 30,802,990
STEEL - 0.5%
Russel Metals, Inc.,
6.375% 03/01/14 8,780,000 8,384,900
-------------
Steel Total 8,384,900
PAR ($) VALUE ($)
------------ -------------
TECHNOLOGY - 1.1%
Freescale Semiconductor, Inc.,
6.875% 07/15/11 (a) 18,430,000 18,798,600
-------------
Technology Total 18,798,600
TELECOMMUNICATIONS - 2.0%
Nextel Communications, Inc.:
7.375% 08/01/15 26,350,000 27,535,750
9.500% 02/01/11 6,250,000 7,062,500
-------------
Telecommunications Total 34,598,250
TOTAL CORPORATE NOTES & BONDS
(Cost of $1,545,540,593) 1,585,394,672
SHORT-TERM OBLIGATION - 6.7%
Repurchase agreement with State Street
Bank & Trust Co., dated 08/31/04, due
09/01/04 at 1.500%, collateralized by
U.S. Treasury Notes with various
maturities to 05/15/08, market
value $118,427,006 (repurchase
proceeds $116,101,837) 116,097,000 116,097,000
-------------
TOTAL SHORT-TERM OBLIGATION
(Cost of $116,097,000) 116,097,000
TOTAL INVESTMENTS - 98.3%
(COST OF $1,661,637,593) (b) 1,701,491,672
OTHER ASSETS & LIABILITIES, NET - 1.7% 29,822,648
NET ASSETS - 100.0% 1,731,314,320
NOTES TO INVESTMENT PORTFOLIO:
(a) Security exempt from registration pursuant to Rule 144A under the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers. At
August 31, 2004, these securities amounted to $153,397,462, which
represents 8.9% of net assets.
(b) Cost for federal income tax purposes is $1,670,205,943.
See Accompanying Notes to Financial Statements.
119
INVESTMENT PORTFOLIO ___________________________________________________________
AUGUST 31, 2004 COLUMBIA DAILY INCOME COMPANY
PAR ($) VALUE ($)
------------ -------------
U.S. GOVERNMENT AGENCIES - 11.7%
Federal Farm Credit Bank (FFCB),
3.650% 10/22/04 2,300,000 2,306,836
Federal Home Loan Bank (FHLB),
3.875% 12/15/04 12,000,000 12,073,290
Federal Home Loan Mortgage
Corp. (FHLMC),
1.405% 09/28/04 17,000,000 16,982,083
Federal National Mortgage
Association (FNMA):
1.320% 09/01/04 10,000,000 10,000,000
1.540% 10/01/04 7,500,000 7,490,375
Student Loan Marketing
Association (SLMA):
1.410% 09/15/04 10,000,000 9,994,517
3.625% 09/30/04 3,700,000 3,706,195
Tennessee Valley Authority,
1.305% 09/09/04 15,000,000 14,995,650
-------------
TOTAL U.S. GOVERNMENT AGENCIES
(Cost of $77,548,946) 77,548,946
COMMERCIAL PAPER - 74.2%
Abbey National North America LLC,
1.600% 10/28/04 14,000,000 13,964,533
AIG Funding, Inc.,
1.570% 11/16/04 8,000,000 7,973,484
American Express Credit Corp.,
1.480% 09/08/04 10,000,000 9,997,122
American Honda Finance,
1.500% 09/21/04 14,000,000 13,988,333
Archer-Daniels-Midland Co.:
1.360% 09/01/04 10,000,000 10,000,000
1.530% 10/13/04 4,300,000 4,292,325
Barclays U.S. Funding Corp.:
1.340% 09/09/04 12,000,000 11,996,427
1.540% 09/27/04 3,600,000 3,595,996
BellSouth Corp.,
1.510% 09/08/04 (a) 13,000,000 12,996,183
ChevronTexaco Funding Corp.:
1.330% 09/13/04 8,000,000 7,996,453
1.500% 09/24/04 8,500,000 8,491,854
Citicorp:
1.520% 09/27/04 7,000,000 6,992,316
1.520% 09/28/04 7,500,000 7,491,450
Coca-Cola Co.:
1.330% 09/02/04 6,100,000 6,099,775
1.340% 09/02/04 3,800,000 3,799,859
1.480% 09/10/04 7,000,000 6,997,410
Colgate-Palmolive Co.,
1.450% 09/07/04 (a) 9,700,000 9,697,656
Deutsche Bank Financial LLC,
1.420% 09/17/04 15,000,000 14,990,533
Eli Lilly & Co.,
1.400% 10/04/04 13,900,000 13,882,162
Gannett Co.,
1.480% 09/10/04 6,500,000 6,497,595
PAR ($) VALUE ($)
------------ -------------
General Electric Capital Corp.,
1.430% 09/21/04 9,500,000 9,492,453
GlaxoSmithKline PLC:
1.460% 09/22/04 (a) 11,400,000 11,390,291
1.650% 11/23/04 (a) 5,000,000 4,980,979
Goldman Sachs Group, Inc.,
1.600% 11/08/04 8,000,000 7,975,822
Grainger (W.W.), Inc.,
1.500% 09/27/04 13,000,000 12,985,917
HBOS Treasury Services PLC:
1.630% 11/10/04 6,000,000 5,980,983
1.700% 11/19/04 7,200,000 7,173,140
IBM Corp.:
1.430% 09/20/04 7,000,000 6,994,717
1.480% 09/20/04 1,300,000 1,298,985
Merrill Lynch & Co., Inc.:
1.020% 09/20/04 5,000,000 4,997,308
1.510% 10/01/04 7,800,000 7,790,185
MetLife Funding, Inc.:
1.340% 09/08/04 1,100,000 1,099,714
1.520% 10/08/04 4,000,000 3,993,751
1.570% 10/12/04 8,900,000 8,884,086
Minnesota Mining &
Manufacturing Co.,
1.430% 09/07/04 10,000,000 9,997,617
Morgan Stanley Dean Witter & Co.,
1.520% 09/03/04 11,600,000 11,599,021
National Rural Utilities
Cooperative Finance Corp.,
1.540% 09/21/04 3,500,000 3,497,006
Nestle Capital Corp.,
1.500% 10/18/04 15,000,000 14,970,625
PACCAR Financial Corp.:
1.230% 09/03/04 9,000,000 8,999,385
1.480% 10/12/04 4,500,000 4,492,415
Pepsico, Inc.,
1.480% 09/01/04 10,000,000 10,000,000
Pfizer, Inc.:
1.030% 09/07/04 9,000,000 8,998,455
1.040% 09/10/04 9,500,000 9,497,530
Private Export Funding Corp.,
1.600% 11/15/04 14,000,000 13,953,333
Prudential Funding Corp.,
1.470% 09/13/04 10,000,000 9,995,100
Royal Bank of Scotland PLC,
1.450% 09/14/04 13,700,000 13,692,827
Siemens Capital Corp.,
1.510% 10/14/04 7,000,000 6,987,375
Societe Generale of North
America, Inc.,
1.620% 11/24/04 14,000,000 13,947,080
Toyota Motor Credit Co.:
1.520% 09/23/04 12,500,000 12,488,389
1.580% 10/27/04 4,000,000 3,990,169
UBS Finance, Inc.,
1.125% 12/23/04 15,000,000 14,947,031
Verizon Network Funding Corp.:
1.490% 09/09/04 10,000,000 9,996,689
1.500% 09/16/04 4,400,000 4,397,250
See Accompanying Notes to Financial Statements.
120
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA DAILY INCOME COMPANY
COMMERCIAL PAPER - (CONTINUED)
Wal-Mart Stores, Inc.,
1.510% 10/05/04 (a) 16,800,000 16,776,041
Wells Fargo & Co.,
1.510% 09/16/04 10,100,000 10,093,645
-------------
TOTAL COMMERCIAL PAPER
(Cost of $490,096,780) 490,096,780
CORPORATE BONDS - 14.0%
AIG SunAmerica Global Financing,
1.725% 11/15/04 (a)(b) 8,000,000 8,002,910
E.I. du Pont de Nemours & Co.,
6.750% 10/15/04 14,485,000 14,581,807
General Electric Capital Corp.,
1.645% 03/15/05 (b) 7,932,000 7,940,176
Gillette Co.,
3.750% 12/01/04 (a) 10,020,000 10,076,959
JPMorgan Chase & Co.,
2.000% 05/20/05 (b) 6,000,000 6,013,183
Norwest Financial, Inc.,
6.700% 09/22/04 7,500,000 7,522,472
PepsiCo, Inc.,
4.500% 09/15/04 4,225,000 4,230,046
Pitney Bowes, Inc.,
5.950% 02/01/05 1,350,000 1,372,600
Procter & Gamble Co.,
6.600% 12/15/04 14,625,000 14,848,435
US Bank NA,
1.765% 11/05/04 (b) 18,000,000 18,009,608
-------------
TOTAL CORPORATE BONDS
(Cost of $92,598,196) 92,598,196
TOTAL INVESTMENTS - 99.9%
(COST OF $660,243,922) (c) 660,243,922
OTHER ASSETS & LIABILITIES, NET - 0.1% 869,624
NET ASSETS - 100.0% 661,113,546
NOTES TO INVESTMENT PORTFOLIO:
(a) Security exempt from registration under Section 4(2) of the Securities Act
of 1933. These securities may only be resold in exempt transactions to
qualified buyers. Private resale of these securities to qualified
institutional buyers are also exempt from registration pursuant to Rule
144A under the Securities Act of 1933. At August 31, 2004, these securities
amounted $73,921,019, which represents 11.2% of net assets.
(b) Floating rate note. The interest rate shown reflects the rate as of August
31, 2004.
(c) Cost for both financial statement and federal income tax purposes is the
same.
See Accompanying Notes to Financial Statements.
121
STATEMENTS OF ASSETS AND LIABILITIES ___________________________________________
AUGUST 31, 2004 COLUMBIA FUNDS
COMMON INTERNATIONAL MID CAP SMALL CAP
STOCK GROWTH STOCK GROWTH GROWTH
FUND (a)($) FUND (a)($) FUND (a)($) FUND (a)($) FUND ($)
- ----------------------------------------------------------------------------------------------------------------------------------
ASSETS
Unaffiliated investments, at identified cost
(including short-term obligations) 289,420,634 695,856,877 557,030,399 842,645,759 503,034,210
Affiliated investments, at identified cost -- -- -- -- --
----------- ------------- ------------- ----------- ------------
Total investments, at identified cost 289,420,634 695,856,877 557,030,399 842,645,759 503,034,210
----------- ------------- ------------- ----------- ------------
Unaffiliated investments, at value 300,511,634 802,881,609 570,312,613 844,876,250 537,463,596
Affiliated investments, at value -- -- -- -- --
Repurchase agreement 10,266,000 4,024,000 28,412,000 23,086,000 6,921,000
----------- ------------- ------------- ----------- ------------
Total investments, at value 310,777,634 806,905,609 598,724,613 867,962,250 544,384,596
Cash -- 128,006 627 947 541
Foreign currency (cost of $48,999) -- -- 49,167 -- --
Receivable for:
Investments sold 736,054 5,556,951 885,098 8,391,238 4,197,797
Capital stock sold 102,046 179,397 579,863 255,088 517,193
Interest 428 168 1,184 962 288
Dividends 461,518 833,348 1,217,846 210,357 103,552
Foreign tax reclaim -- 22,956 279,912 -- --
Expense reimbursement due from Investment Advisor -- -- -- -- --
Deferred compensation plan 1,508 9,029 2,089 9,849 1,560
Other assets -- 380 -- 410 --
----------- ------------- ------------- ----------- ------------
Total assets 312,079,188 813,635,844 601,740,399 876,831,101 549,205,527
- ----------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Payable to custodian bank 382,268 -- -- 1,674 --
Payable for:
Investments purchased on a delayed delivery basis -- -- -- -- --
Investments purchased 869,366 -- 6,757,019 10,780,153 3,550,394
Capital stock redeemed 3,827,648 1,905,590 407,990 2,599,247 2,018,797
Future variation margin -- -- -- -- --
Distributions -- -- -- -- --
Investment advisory fee 160,145 417,079 437,196 649,626 465,433
Transfer agent fee 92,338 209,220 42,762 164,744 75,713
Pricing and bookkeeping fees 12,507 14,011 13,420 13,321 13,239
Directors' fees -- -- 1,115 2,197 793
Audit fee 29,460 31,550 26,010 28,331 26,679
Service and distribution fees 2,188 5,985 14,916 13,030 --
Custody fee 5,500 6,500 59,602 5,697 6,612
Deferred compensation plan 1,508 9,029 2,089 9,849 1,560
Foreign capital gains tax payable -- -- 152,481 -- --
Other liabilities 22,872 57,563 34,532 81,913 30,000
----------- ------------- ------------- ----------- ------------
Total liabilities 5,405,800 2,656,527 7,949,132 14,349,782 6,189,220
NET ASSETS 306,673,388 810,979,317 593,791,267 862,481,319 543,016,307
- ----------------------------------------------------------------------------------------------------------------------------------
NET ASSETS CONSIST OF
Paid-in capital 353,308,124 1,075,808,961 582,376,931 968,695,619 602,006,022
Undistributed (overdistributed) net investment income 773,939 -- 2,274,226 -- --
Accumulated net investment loss -- (4,315) -- (73,873) --
Accumulated net realized gain (loss) (68,765,675) (375,874,061) (32,499,115) (131,456,937) (100,340,101)
Unrealized appreciation (depreciation) on:
Investments 21,357,000 111,048,732 41,694,214 25,316,491 41,350,386
Foreign currency translations -- -- 14,178 19 --
Foreign capital gains tax -- -- (69,167) -- --
Futures contracts -- -- -- -- --
----------- ------------- ------------- ----------- ------------
NET ASSETS 306,673,388 810,979,317 593,791,267 862,481,319 543,016,307
REAL ESTATE STRATEGIC SHORT TERM
EQUITY TECHNOLOGY INVESTOR BALANCED BOND
FUND (a)($) FUND (a)($) FUND (a)($) FUND (a)($) FUND (a)($)
- ----------------------------------------------------------------------------------------------------------------------------------
ASSETS
Unaffiliated investments, at identified cost
(including short-term obligations) 656,316,387 33,105,269 355,726,305 477,662,627 518,633,342
Affiliated investments, at identified cost -- -- -- -- 2,291,600
----------- ----------- ----------- ----------- -----------
Total investments, at identified cost 656,316,387 33,105,269 355,726,305 477,662,627 520,924,942
----------- ----------- ----------- ----------- -----------
Unaffiliated investments, at value 890,737,609 33,770,364 316,950,978 480,766,930 489,268,528
Affiliated investments, at value -- -- -- -- 2,260,153
Repurchase agreement 43,079,000 1,501,000 91,580,000 15,793,000 31,055,000
----------- ----------- ----------- ----------- -----------
Total investments, at value 933,816,609 35,271,364 408,530,978 496,559,930 522,583,681
Cash 770 99,721 251,957 192,166 1,262
Foreign currency (cost of $48,999) -- -- -- -- --
Receivable for:
Investments sold -- 1,720,630 832,807 173,276,657 1,254,689
Capital stock sold 1,230,217 72,684 2,102,049 413,093 --
Interest 1,795 62 3,816 1,368,990 3,324,435
Dividends 568,968 16,609 385,377 499,169 --
Foreign tax reclaim -- 307 12,730 -- --
Expense reimbursement due from Investment Advisor -- 32,931 -- -- 44,562
Deferred compensation plan 2,263 1,062 10,990 1,638 7,709
Other assets 5,748 -- 227 -- --
----------- ----------- ----------- ----------- -----------
Total assets 935,626,370 37,215,370 412,130,931 672,311,643 527,216,338
- ----------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Payable to custodian bank -- -- 477,524 -- --
Payable for:
Investments purchased on a delayed delivery basis -- -- -- -- --
Investments purchased 9,505,143 1,215,627 1,184,262 169,792,236 --
Capital stock redeemed 1,940,486 106,617 627,811 7,379,085 581,347
Future variation margin -- -- -- -- 67,500
Distributions -- -- -- -- 638,976
Investment advisory fee 561,831 30,963 253,489 216,351 209,898
Transfer agent fee 153,626 23,197 80,556 126,584 82,781
Pricing and bookkeeping fees 13,160 5,434 11,262 18,299 13,152
Directors' fees 1,792 464 1,750 1,420 --
Audit fee 21,451 21,010 26,170 34,460 31,080
Service and distribution fees 22,568 3,130 49,188 8,201 45,417
Custody fee 4,369 4,000 8,135 6,500 4,220
Deferred compensation plan 2,263 1,062 10,990 1,638 7,709
Foreign capital gains tax payable -- -- -- -- --
Other liabilities 76,342 9,061 29,278 26,627 36,071
----------- ----------- ----------- ----------- -----------
Total liabilities 12,303,031 1,420,565 2,760,415 177,611,401 1,718,151
NET ASSETS 923,323,339 35,794,805 409,370,516 494,700,242 525,498,187
- ----------------------------------------------------------------------------------------------------------------------------------
NET ASSETS CONSIST OF
Paid-in capital 549,607,414 36,403,254 353,062,699 542,222,364 525,601,528
Undistributed (overdistributed) net investment income 2,565,892 -- 403,906 1,334,170 293,885
Accumulated net investment loss -- (4,733) -- -- --
Accumulated net realized gain (loss) 93,649,811 (2,769,811) 3,098,857 (67,753,595) (1,975,808)
Unrealized appreciation (depreciation) on:
Investments 277,500,222 2,166,095 52,804,673 18,897,303 1,658,739
Foreign currency translations -- -- 381 -- --
Foreign capital gains tax -- -- -- -- --
Futures contracts -- -- -- -- (80,157)
----------- ----------- ----------- ----------- -----------
NET ASSETS 923,323,339 35,794,805 409,370,516 494,700,242 525,498,187
FIXED NATONAL OREGON
INCOME MUNICIPAL MUNICIPAL DAILY
SECURITIES BOND BOND HIGH YIELD INCOME
FUND (a)($) FUND (a)($) FUND (a)($) FUND (a)($) COMPANY ($)
- ----------------------------------------------------------------------------------------------------------------------------------
ASSETS
Unaffiliated investments, at identified cost
(including short-term obligations) 338,874,943 14,399,099 415,547,348 1,661,637,593 660,243,922
Affiliated investments, at identified cost -- -- -- -- --
----------- ----------- ----------- ------------- -----------
Total investments, at identified cost 338,874,943 14,399,099 415,547,348 1,661,637,593 660,243,922
----------- ----------- ----------- ------------- -----------
Unaffiliated investments, at value 336,230,379 15,074,617 436,388,010 1,585,394,672 660,243,922
Affiliated investments, at value -- -- -- -- --
Repurchase agreement 9,144,000 -- -- 116,097,000 --
----------- ----------- ----------- ------------- -----------
Total investments, at value 345,374,379 15,074,617 436,388,010 1,701,491,672 660,243,922
Cash 560 347,513 30,028 571 75,612
Foreign currency (cost of $48,999) -- -- -- -- --
Receivable for:
Investments sold 2,776,496 -- 1,068,750 18,177,354 --
Capital stock sold 110,962 1,670 222,319 3,475,118 1,630,285
Interest 2,864,106 170,196 5,061,981 27,951,026 1,228,994
Dividends -- -- -- -- --
Foreign tax reclaim -- -- -- -- --
Expense reimbursement due from Investment Advisor -- 13,157 -- -- --
Deferred compensation plan 1,878 448 1,893 3,502 2,071
Other assets 71,935 198 -- -- 368,538
----------- ----------- ----------- ------------- -----------
Total assets 351,200,316 15,607,799 442,772,981 1,751,099,243 663,549,422
- ----------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Payable to custodian bank -- -- -- -- --
Payable for:
Investments purchased on a delayed delivery basis 5,224,550 -- 1,399,787 -- --
Investments purchased 37,004 733,440 -- 8,597,194 --
Capital stock redeemed 4,317,170 -- 299,608 5,922,391 2,014,249
Future variation margin -- -- -- -- --
Distributions -- 8,416 326,569 3,778,660 --
Investment advisory fee 148,187 6,046 186,958 865,776 278,318
Transfer agent fee 91,846 4,073 32,838 194,385 56,343
Pricing and bookkeeping fees 15,497 6,850 14,873 15,157 13,606
Directors' fees 334 514 4,332 1,739 --
Audit fee 33,230 28,130 28,058 30,900 28,700
Service and distribution fees 9,157 1,543 2,730 283,349 --
Custody fee 4,000 1,172 4,536 5,806 4,200
Deferred compensation plan 1,878 448 1,893 3,502 2,071
Foreign capital gains tax payable -- -- -- -- --
Other liabilities 47,900 5,364 22,819 86,064 38,389
----------- ----------- ----------- ------------- -----------
Total liabilities 9,930,753 795,996 2,325,001 19,784,923 2,435,876
NET ASSETS 341,269,563 14,811,803 440,447,980 1,731,314,320 661,113,546
- ----------------------------------------------------------------------------------------------------------------------------------
NET ASSETS CONSIST OF
Paid-in capital 332,432,216 14,068,144 418,153,690 1,716,319,169 661,113,546
Undistributed (overdistributed) net investment income (766,809) 5,039 129,015 (8,565,037) --
Accumulated net investment loss -- -- -- -- --
Accumulated net realized gain (loss) 3,104,720 63,102 1,324,613 (16,293,891) --
Unrealized appreciation (depreciation) on:
Investments 6,499,436 675,518 20,840,662 39,854,079 --
Foreign currency translations -- -- -- -- --
Foreign capital gains tax -- -- -- -- --
Futures contracts -- -- -- -- --
----------- ----------- ----------- ------------- -----------
NET ASSETS 341,269,563 14,811,803 440,447,980 1,731,314,320 661,113,546
See Accompanying Notes to Financial Statements.
Spread 122-123
STATEMENTS OF ASSETS AND LIABILITIES ___________________________________________
August 31, 2004 COLUMBIA FUNDS
COMMON INTERNATIONAL MID CAP SMALL CAP
STOCK GROWTH STOCK GROWTH GROWTH
FUND (a)($) FUND (a)($) FUND (a)($) FUND (a)($) FUND ($)
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS A
Net assets 1,200,760 4,667,723 24,118,642 4,432,306 --
Shares outstanding 66,353 187,196 1,849,706 260,892 --
Net asset value per share (b) 18.10 24.93 13.04 16.99 --
Maximum sales charge 5.75% 5.75% 5.75% 5.75% --
Maximum offering price per share (c) 19.20 26.45 13.84 18.03 --
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS B
Net assets 2,059,569 2,254,121 10,221,053 5,078,719 --
Shares outstanding 115,162 91,624 797,769 303,127 --
Net asset value and offering price per share (b) 17.88 24.60 12.81 16.75 --
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS C
Net assets 25,761 198,742 631,698 500,680 --
Shares outstanding 1,441 8,098 49,113 29,822 --
Net asset value and offering price per share (b) 17.88 24.54 12.86 16.79 --
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS D
Net assets 128,635 166,601 737,642 599,007 --
Shares outstanding 7,196 6,766 57,148 35,720 --
Net asset value and offering price per share (b) 17.88 24.62 12.91 16.77 --
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS G
Net assets -- 12,995,824 -- 646,565 --
Shares outstanding -- 527,322 -- 38,713 --
Net asset value and offering price per share (b) -- 24.64 -- 16.70 --
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS T
Net assets -- -- -- 25,236,065 --
Shares outstanding -- -- -- 1,482,193 --
Net asset value per share (b) -- -- -- 17.03 --
Maximum sales charge -- -- -- 5.75% --
Maximum offering price per share (c) -- -- -- 18.07 --
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS Z
Net assets 303,258,663 790,696,306 558,082,232 825,987,977 543,016,307
Shares outstanding 16,736,667 31,509,450 42,471,114 48,197,981 25,469,254
Net asset value and offering price per share (d) 18.12 25.09 13.14 17.14 21.32
REAL ESTATE STRATEGIC SHORT TERM
EQUITY TECHNOLOGY INVESTOR BALANCED BOND
FUND (a)($) FUND (a)($) FUND (a)($) FUND (a)($) FUND (a)($)
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS A
Net assets 32,703,369 2,817,533 99,608,221 2,577,205 28,145,505
Shares outstanding 1,277,917 433,379 5,420,896 129,796 3,256,671
Net asset value per share (b) 25.59 6.50 18.37 19.86 8.64
Maximum sales charge 5.75% 5.75% 5.75% 5.75% 4.75%
Maximum offering price per share (c) 27.15 6.90 19.49 21.07 9.07
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS B
Net assets 11,233,601 2,200,128 22,070,607 7,285,804 25,124,857
Shares outstanding 438,864 343,650 1,214,514 367,449 2,907,169
Net asset value and offering price per share (b) 25.60 6.40 18.17 19.83 8.64
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS C
Net assets 2,404,136 487,706 14,821,403 729,833 3,128,427
Shares outstanding 93,988 76,077 815,232 36,808 361,991
Net asset value and offering price per share (b) 25.58 6.41 18.18 19.83 8.64
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS D
Net assets 4,058,522 21,346 692,764 360,946 9,808,598
Shares outstanding 158,584 3,320 38,136 18,210 1,134,935
Net asset value and offering price per share (b) 25.59 6.43 18.17 19.82 8.64
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS G
Net assets -- -- -- -- 1,056,483
Shares outstanding -- -- -- -- 122,244
Net asset value and offering price per share (b) -- -- -- -- 8.64
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS T
Net assets -- -- -- -- 21,159,894
Shares outstanding -- -- -- -- 2,448,392
Net asset value per share (b) -- -- -- -- 8.64
Maximum sales charge -- -- -- -- 4.75%
Maximum offering price per share (c) -- -- -- -- 9.07
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS Z
Net assets 872,923,711 30,268,092 272,177,521 483,746,454 437,074,423
Shares outstanding 34,095,088 4,622,051 14,773,693 24,382,455 50,573,176
Net asset value and offering price per share (d) 25.60 6.55 18.42 19.84 8.64
FIXED NATONAL OREGON
INCOME MUNICIPAL MUNICIPAL DAILY
SECURITIES BOND BOND HIGH YIELD INCOME
FUND (a)($) FUND (a)($) FUND (a)($) FUND (a)($) COMPANY ($)
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS A
Net assets 10,707,262 1,286,487 3,680,414 335,841,493 --
Shares outstanding 793,990 124,940 295,578 38,648,333 --
Net asset value per share (b) 13.49 10.30 12.45 8.69 --
Maximum sales charge 4.75% 4.75% 4.75% 4.75% --
Maximum offering price per share (c) 14.16 10.81 13.07 9.12 --
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS B
Net assets 4,334,157 762,194 1,190,316 102,038,152 --
Shares outstanding 321,399 74,022 95,596 11,742,379 --
Net asset value and offering price per share (b) 13.49 10.30 12.45 8.69 --
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS C
Net assets 158,362 363,272 278,214 20,126,336 --
Shares outstanding 11,743 35,280 22,344 2,316,117 --
Net asset value and offering price per share (b) 13.49 10.30 12.45 8.69 --
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS D
Net assets 1,744,737 432,725 790,326 86,854,375 --
Shares outstanding 129,376 42,025 63,472 9,995,149 --
Net asset value and offering price per share (b) 13.49 10.30 12.45 8.69 --
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS G
Net assets -- -- -- -- --
Shares outstanding -- -- -- -- --
Net asset value and offering price per share (b) -- -- -- -- --
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS T
Net assets -- -- -- -- --
Shares outstanding -- -- -- -- --
Net asset value per share (b) -- -- -- -- --
Maximum sales charge -- -- -- -- --
Maximum offering price per share (c) -- -- -- -- --
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS Z
Net assets 324,325,045 11,967,125 434,508,710 1,186,453,964 661,113,546
Shares outstanding 24,050,215 1,162,228 34,896,080 136,532,675 661,113,546
Net asset value and offering price per share (d) 13.49 10.30 12.45 8.69 1.00
(a) Class C shares were initially offered on October 13, 2003.
(b) Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
(c) On sales of $50,000 or more the offering price is reduced.
(d) Redemption price per share is equal to net asset value less any applicable
redemption fees.
See Accompanying Notes to Financial Statements.
Spread 124-125
STATEMENTS OF OPERATIONS _______________________________________________________
FOR THE YEAR ENDED AUGUST 31, 2004 COLUMBIA FUNDS
COMMON INTERNATIONAL MID CAP SMALL CAP
STOCK GROWTH STOCK GROWTH GROWTH
FUND (a)($) FUND (a)($) FUND (a)($) FUND (a)($) FUND (a)($)
- ----------------------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME
INCOME
Dividends 5,071,208 7,898,046 10,502,144 2,938,819 976,524
Dividends from affiliates 133,332 -- -- -- --
Interest 39,093 42,357 225,992 288,115 183,159
Interest from affiliates -- -- -- -- --
Foreign withholding tax (12,834) (92,186) (1,235,663) (28,435) (2,574)
----------- ----------- ----------- ----------- -----------
Total income 5,230,799 7,848,217 9,492,473 3,198,499 1,157,109
- ----------------------------------------------------------------------------------------------------------------------------------
EXPENSES
Investment advisory fee 2,366,388 5,482,681 4,953,878 8,813,801 7,019,787
Distribution fee:
Class B 12,052 13,582 83,878 38,634 --
Class C 242 779 2,845 2,206 --
Class D 1,049 2,114 5,532 5,635 --
Class G -- 94,563 -- 5,005 --
Service fee:
Class A 1,533 12,228 61,658 13,691 --
Class B 4,005 4,527 27,959 12,878 --
Class C 80 260 948 735 --
Class D 348 710 1,834 1,874 --
Class G -- 43,644 -- 2,309 --
Shareholder services fee - Class T -- -- -- 87,984 --
Transfer agent fee:
Class A 1,487 11,182 104,768 19,091 --
Class B 4,237 4,495 60,592 22,925 --
Class C 73 234 1,099 829 --
Class D 310 602 3,907 2,410 --
Class G -- 31,562 -- 5,236 --
Class T -- -- -- 78,621 --
Class Z 886,095 1,822,101 594,779 1,636,195 821,652
Pricing and bookkeeping fees 121,476 150,954 136,442 153,692 147,011
Directors' fees 12,074 14,394 9,503 27,370 20,266
Custody fee 35,514 36,169 321,832 35,806 32,301
Audit fee 38,797 47,381 38,483 51,962 33,010
Registration fees 117,159 87,074 96,078 131,817 67,900
Non-recurring costs (See Note 11) 17,852 42,776 27,108 46,903 33,352
Other expenses 42,313 295,807 141,382 337,737 105,945
----------- ----------- ----------- ----------- -----------
Total Operating Expenses 3,663,084 8,199,819 6,674,505 11,535,346 8,281,224
Interest expense 721 -- -- -- --
----------- ----------- ----------- ----------- -----------
Total Expenses 3,663,805 8,199,819 6,674,505 11,535,346 8,281,224
Expenses waived/reimbursed by Investment Advisor -- -- (373,733) -- --
Fees waived by Distributor:
Class C -- -- -- -- --
Class D -- -- -- -- --
Fees waived by Transfer Agent:
Class A -- -- (6,795) (1,011) --
Class B -- -- (12,299) (5,244) --
Class C -- -- (976) (209) --
Class D -- -- (3,670) (606) --
Class G -- -- -- (87) --
Class T -- -- -- (3,364) --
Class Z -- -- (447,801) (483,354) --
Non-recurring costs assumed by Investment Advisor
(See Note 11) (17,852) (42,776) (27,108) (46,903) (33,352)
Custody earnings credit (166) (149) (833) (1,601) (589)
----------- ----------- ----------- ----------- -----------
Net Expenses 3,645,787 8,156,894 5,801,290 10,992,967 8,247,283
----------- ----------- ----------- ----------- -----------
Net Investment Income (Loss) 1,585,012 (308,677) 3,691,183 (7,794,468) (7,090,174)
REAL ESTATE STRATEGIC SHORT TERM
EQUITY TECHNOLOGY INVESTOR BALANCED BOND
FUND (a)($) FUND (a)($) FUND (a)($) FUND (a)($) FUND (a)($)
- ----------------------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME
INCOME
Dividends 42,727,707 118,550 4,402,950 5,067,164 --
Dividends from affiliates -- -- -- 132,304 --
Interest 283,601 16,966 729,746 9,718,261 15,515,851
Interest from affiliates -- -- -- 101,238 128,854
Foreign withholding tax (37,753) (6,658) (118,183) (13,100) --
----------- ----------- ----------- ----------- -----------
Total income 42,973,555 128,858 5,014,513 15,005,867 15,644,705
- ----------------------------------------------------------------------------------------------------------------------------------
EXPENSES
Investment advisory fee 7,214,201 361,947 2,576,915 3,002,434 2,678,339
Distribution fee:
Class B 62,850 18,559 78,695 42,507 190,933
Class C 8,738 1,830 33,396 3,270 12,776
Class D 31,895 279 5,589 4,458 116,445
Class G -- -- -- -- 8,592
Service fee:
Class A 70,852 4,349 189,017 4,349 74,475
Class B 20,950 6,186 26,135 14,169 63,644
Class C 2,912 609 11,132 1,090 4,260
Class D 10,632 93 1,863 1,486 38,815
Class G -- -- -- -- 1,979
Shareholder services fee - Class T -- -- -- -- 37,561
Transfer agent fee:
Class A 37,594 8,287 114,100 3,886 31,977
Class B 12,810 10,432 27,297 11,860 37,754
Class C 1,441 1,345 9,660 909 1,949
Class D 5,662 270 1,366 1,218 13,897
Class G -- -- -- -- 2,984
Class T -- -- -- -- 33,578
Class Z 1,322,014 153,489 429,770 1,137,263 445,738
Pricing and bookkeeping fees 150,060 57,717 113,408 178,067 174,934
Directors' fees 23,682 8,333 10,965 15,765 7,156
Custody fee 32,320 23,614 41,684 42,517 30,935
Audit fee 34,454 31,341 47,500 45,443 45,902
Registration fees 138,591 104,522 112,786 117,058 176,644
Non-recurring costs (See Note 11) 43,675 1,891 17,368 27,135 25,190
Other expenses 312,146 27,628 129,029 89,361 103,455
----------- ----------- ----------- ----------- -----------
Total Operating Expenses 9,537,479 822,721 3,977,675 4,744,245 4,359,912
Interest expense -- -- -- -- --
----------- ----------- ----------- ----------- -----------
Total Expenses 9,537,479 822,721 3,977,675 4,744,245 4,359,912
Expenses waived/reimbursed by Investment Advisor -- (191,213) -- -- (263,148)
Fees waived by Distributor:
Class C -- -- -- -- (10,231)
Class D -- -- -- -- (93,156)
Fees waived by Transfer Agent:
Class A -- -- (6,998) -- --
Class B -- -- (14,150) -- --
Class C -- -- (3,376) -- --
Class D -- -- (906) -- --
Class G -- -- -- -- --
Class T -- -- -- -- --
Class Z -- -- (75,713) -- --
Non-recurring costs assumed by Investment Advisor
(See Note 11) (43,675) (1,891) (17,368) (27,135) (25,190)
Custody earnings credit (121) (512) (621) (571) (687)
----------- ----------- ----------- ----------- -----------
Net Expenses 9,493,683 629,105 3,858,543 4,716,539 3,967,500
----------- ----------- ----------- ----------- -----------
Net Investment Income (Loss) 33,479,872 (500,247) 1,155,970 10,289,328 11,677,205
FIXED NATONAL OREGON
INCOME MUNICIPAL MUNICIPAL DAILY
SECURITIES BOND BOND HIGH YIELD INCOME
FUND (a)($) FUND (a)($) FUND (a)($) FUND (a)($) COMPANY ($)
- ----------------------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME
INCOME
Dividends -- -- -- -- --
Dividends from affiliates -- -- -- -- --
Interest 19,951,098 659,150 21,880,921 118,202,398 8,381,263
Interest from affiliates -- -- -- -- --
Foreign withholding tax -- -- -- (24,861) --
----------- ----------- ----------- ----------- -----------
Total income 19,951,098 659,150 21,880,921 118,177,537 8,381,263
- ----------------------------------------------------------------------------------------------------------------------------------
EXPENSES
Investment advisory fee 2,099,971 76,297 2,338,697 10,523,463 3,704,497
Distribution fee:
Class B 34,061 5,491 9,166 761,891 --
Class C 755 4,423 908 87,485 --
Class D 17,339 3,514 5,927 768,275 --
Class G -- -- -- -- --
Service fee:
Class A 22,484 2,286 7,100 675,162 --
Class B 11,353 1,831 3,054 253,964 --
Class C 252 1,469 302 29,162 --
Class D 5,779 1,171 1,970 256,091 --
Class G -- -- -- -- --
Shareholder services fee - Class T -- -- -- -- --
Transfer agent fee:
Class A 20,409 1,827 2,164 266,759 --
Class B 10,977 1,437 1,056 116,285 --
Class C 238 940 65 12,135 --
Class D 5,195 686 669 110,131 --
Class G -- -- -- -- --
Class T -- -- -- -- --
Class Z 779,850 18,903 245,256 1,350,600 1,299,719
Pricing and bookkeeping fees 147,656 65,576 182,482 186,141 146,678
Directors' fees 13,762 2,759 20,395 41,438 17,269
Custody fee 22,713 7,968 23,242 46,761 22,573
Audit fee 43,652 40,552 40,880 41,422 34,839
Registration fees 89,281 84,654 121,229 234,619 75,636
Non-recurring costs (See Note 11) 17,352 700 21,237 81,196 --
Other expenses 113,020 15,869 72,722 493,018 155,376
----------- ----------- ----------- ----------- -----------
Total Operating Expenses 3,456,099 338,353 3,098,521 16,335,998 5,456,587
Interest expense -- -- -- -- --
----------- ----------- ----------- ----------- -----------
Total Expenses 3,456,099 338,353 3,098,521 16,335,998 5,456,587
Expenses waived/reimbursed by Investment Advisor -- (218,346) -- -- --
Fees waived by Distributor:
Class C (152) (2,061) (424) (17,581) --
Class D (3,468) (1,640) (2,766) (153,656) --
Fees waived by Transfer Agent:
Class A -- -- -- -- --
Class B -- -- -- -- --
Class C -- -- -- -- --
Class D -- -- -- -- --
Class G -- -- -- -- --
Class T -- -- -- -- --
Class Z -- -- -- -- --
Non-recurring costs assumed by Investment Advisor
(See Note 11) (17,352) (700) (21,237) (81,196) --
Custody earnings credit (713) (56) (302) (12,007) (774)
----------- ----------- ----------- ----------- -----------
Net Expenses 3,434,414 115,550 3,073,792 16,071,558 5,455,813
----------- ----------- ----------- ----------- -----------
Net Investment Income (Loss) 16,516,684 543,600 18,807,129 102,105,979 2,925,450
(a) Class C shares were initially offered on October 13, 2003.
See Accompanying Notes to Financial Statements.
Spread 126-127
STATEMENTS OF OPERATIONS _______________________________________________________
FOR THE YEAR ENDED AUGUST 31, 2004 COLUMBIA FUNDS
COMMON INTERNATIONAL MID CAP SMALL CAP
STOCK GROWTH STOCK GROWTH GROWTH
FUND (a)($) FUND (a)($) FUND (a)($) FUND (a)($) FUND (a)($)
- ----------------------------------------------------------------------------------------------------------------------------------
NETREALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS,
FOREIGN CURRENCY, FOREIGN CAPITAL GAINS TAX AND
FUTURES CONTRACTS
Net realized gain (loss) on:
Unaffiliated investments 75,766,146 90,532,670 31,660,421 136,678,744 108,746,196
Affiliated investments 3,770,605 -- -- -- --
Foreign currency transactions -- -- (1,008,219) (68,420) --
Foreign capital gains tax -- -- (985,510) -- --
Futures contracts -- -- -- -- --
Net realized loss on the disposal of
investments purchased/sold in error
(See Note 9) -- -- -- -- --
----------- ----------- ----------- ------------ ------------
Net realized gain 79,536,751 90,532,670 29,666,692 136,610,324 108,746,196
----------- ----------- ----------- ------------ ------------
Change in net unrealized appreciation/
depreciation on:
Investments (53,832,811) (70,015,156) 12,529,973 (178,274,880) (104,998,632)
Foreign currency translations -- -- 95,740 19 --
Foreign capital gains tax -- -- 304,088 -- --
Futures contracts -- -- -- -- --
----------- ----------- ----------- ------------ ------------
Net change in net unrealized appreciation
/depreciation (53,832,811) (70,015,156) 12,929,801 (178,274,861) (104,998,632)
----------- ----------- ----------- ------------ ------------
Net Gain (Loss) 25,703,940 20,517,514 42,596,493 (41,664,537) 3,747,564
----------- ----------- ----------- ------------ ------------
Net Increase (Decrease) Resulting From Operations 27,288,952 20,208,837 46,287,676 (49,459,005) (3,342,610)
REAL ESTATE STRATEGIC SHORT TERM
EQUITY TECHNOLOGY INVESTOR BALANCED BOND
FUND (a)($) FUND (a)($) FUND (a)($) FUND (a)($) FUND (a)($)
- ----------------------------------------------------------------------------------------------------------------------------------
NETREALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS,
FOREIGN CURRENCY, FOREIGN CAPITAL GAINS TAX AND
FUTURES CONTRACTS
Net realized gain (loss) on:
Unaffiliated investments 103,930,894 3,153,069 32,969,287 78,796,816 669,551
Affiliated investments -- -- -- 3,810,659 --
Foreign currency transactions -- (4,081) (130,171) -- --
Foreign capital gains tax -- -- -- -- --
Futures contracts -- -- -- -- (395,603)
Net realized loss on the disposal of
investments purchased/sold in error
(See Note 9) -- -- -- -- --
----------- ----------- ----------- ------------ ------------
Net realized gain 103,930,894 3,148,988 32,839,116 82,607,475 273,948
----------- ----------- ----------- ------------ ------------
Change in net unrealized appreciation/
depreciation on:
Investments 86,151,012 (1,040,511) 11,368,896 (57,419,638) 751,495
Foreign currency translations -- -- 457 -- --
Foreign capital gains tax -- -- -- -- --
Futures contracts -- -- -- -- (80,157)
----------- ----------- ----------- ------------ ------------
Net change in net unrealized appreciation
/depreciation 86,151,012 (1,040,511) 11,369,353 (57,419,638) 671,338
----------- ----------- ----------- ------------ ------------
Net Gain (Loss) 190,081,906 2,108,477 44,208,469 25,187,837 945,286
----------- ----------- ----------- ------------ ------------
Net Increase (Decrease) Resulting From Operations 223,561,778 1,608,230 45,364,439 35,477,165 12,622,491
FIXED NATONAL OREGON
INCOME MUNICIPAL MUNICIPAL DAILY
SECURITIES BOND BOND HIGH YIELD INCOME
FUND (a)($) FUND (a)($) FUND (a)($) FUND (A)($) COMPANY ($)
- ----------------------------------------------------------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS,
FOREIGN CURRENCY, FOREIGN CAPITAL GAINS TAX AND
FUTURES CONTRACTS
Net realized gain (loss) on:
Unaffiliated investments 6,873,389 128,356 3,418,754 23,256,561 --
Affiliated investments -- -- -- -- --
Foreign currency transactions -- -- -- -- --
Foreign capital gains tax -- -- -- -- --
Futures contracts -- -- -- -- --
Net realized loss on the disposal of
investments purchased/sold in error
(See Note 9) -- -- -- -- --
----------- ----------- ----------- ------------ ------------
Net realized gain 6,873,389 128,356 3,418,754 23,256,561 --
----------- ----------- ----------- ------------ ------------
Change in net unrealized appreciation/
depreciation on:
Investments (509,297) 251,062 9,460,520 23,594,415 --
Foreign currency translations -- -- -- -- --
Foreign capital gains tax -- -- -- -- --
Futures contracts -- -- -- -- --
----------- ----------- ----------- ------------ ------------
Net change in net unrealized appreciation
/depreciation (509,297) 251,062 9,460,520 23,594,415 --
----------- ----------- ----------- ------------ ------------
Net Gain (Loss) 6,364,092 379,418 12,879,274 46,850,976 --
----------- ----------- ----------- ------------ ------------
Net Increase (Decrease) Resulting From Operations 22,880,776 923,018 31,686,403 148,956,955 2,925,450
(a) Class C shares were initially offered on October 13, 2003.
See Accompanying Notes to Financial Statements.
Spread 128-129
STATEMENTS OF CHANGES IN NET ASSETS ____________________________________________
COLUMBIA FUNDS
COMMON STOCK FUND GROWTH FUND
----------------------------------------- -----------------------------------------
YEAR PERIOD YEAR YEAR PERIOD YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
AUGUST 31, AUGUST 31, DECEMBER 31, AUGUST 31, AUGUST 31, DECEMBER 31,
INCREASE (DECREASE) IN NET ASSETS 2004 (a)($) 2003 (b)($) 2002 (c)($) 2004 (a)($) 2003 (b)($) 2002 (d)($)
- ----------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income (loss) 1,585,012 1,506,437 2,314,001 (308,677) (67,881) (334,512)
Net realized gain (loss) on investments,
foreign currency transactions
and foreign capital gains tax 79,536,751 (10,351,264) (76,671,127) 90,532,670 6,034,740 (234,361,212)
Net change in unrealized appreciation
/depreciation on investments,
foreign currency translations
and foreign capital gains tax (53,832,811) 70,348,296 (87,529,297) (70,015,156) 138,988,772 (189,831,805)
------------ ----------- ------------ ------------ ----------- -------------
Net increase (decrease) resulting
from operations 27,288,952 61,503,469 (161,886,423) 20,208,837 144,955,631 (424,527,529)
- ----------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income:
Class A (707) -- (24) -- -- --
Class B -- -- (365) -- -- --
Class D -- -- (105) -- -- --
Class Z (2,316,812) -- (2,325,116) -- -- --
Return of capital:
Class Z -- -- -- -- -- --
------------ ----------- ------------ ------------ ----------- -------------
Total distributions to shareholders (2,317,519) -- (2,325,610) -- -- --
- ----------------------------------------------------------------------------------------------------------------------------------
NET CAPITAL SHARE TRANSACTIONS (146,922,763) (49,688,127) (100,375,770) (138,965,772) (43,866,493) (72,669,754)
------------ ----------- ------------ ------------ ----------- -------------
REDEMPTION FEES -- -- -- -- -- --
------------ ----------- ------------ ------------ ----------- -------------
Net increase (decrease) in net assets (121,951,330) 11,815,342 (264,587,803) (118,756,935) 101,089,138 (497,197,283)
- ----------------------------------------------------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 428,624,718 416,809,376 681,397,179 929,736,252 828,647,114 1,325,844,397
End of period 306,673,388 428,624,718 416,809,376 810,979,317 929,736,252 828,647,114
------------ ----------- ----------- ----------- ----------- -------------
Undistributed (overdistributed) net
investment income (loss) at end
of period 773,939 1,506,446 -- -- -- --
Accumulated net investment loss at
end of period -- -- -- (4,315) (1,289) --
INTERNATIONAL STOCK FUND MID CAP GROWTH FUND
----------------------------------------- ------------------------------------------
YEAR PERIOD YEAR YEAR PERIOD YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
AUGUST 31, AUGUST 31, DECEMBER 31, AUGUST 31, AUGUST 31, DECEMBER 31,
INCREASE (DECREASE) IN NET ASSETS 2004 (a)($) 2003 (b)($) 2002 (c)($) 2004 (a)($) 2003 (b)($) 2002 (e)($)
- ----------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income (loss) 3,691,183 1,285,611 (60,403) (7,794,468) (4,889,028) (5,336,228)
Net realized gain (loss) on investments,
foreign currency transactions
and foreign capital gains tax 29,666,692 (4,669,563) (16,450,936) 136,610,324 17,148,448 (89,710,944)
Net change in unrealized appreciation
/depreciation on investments,
foreign currency translations
and foreign capital gains tax 12,929,801 32,813,483 (5,145,567) (178,274,861) 179,938,855 (104,900,709)
------------ ----------- ------------ ------------- ------------- ------------
Net increase (decrease) resulting
from operations 46,287,676 29,429,531 (21,656,906) (49,459,005) 192,198,275 (199,947,881)
- ----------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income:
Class A -- -- -- -- -- --
Class B -- -- -- -- -- --
Class D -- -- -- -- -- --
Class Z (1,290,808) -- (102,850) -- -- --
Return of capital:
Class Z -- -- (403,799) -- -- --
------------ ----------- ------------ ------------- ------------- ------------
Total distributions to shareholders (1,290,808) -- (506,649) -- -- --
- ----------------------------------------------------------------------------------------------------------------------------------
NET CAPITAL SHARE TRANSACTIONS 267,394,781 76,764,211 61,510,684 (127,233,529) 7,917,882 252,934,343
------------ ----------- ------------ ------------- ------------- ------------
REDEMPTION FEES 68,059 164,843 -- -- -- --
------------ ----------- ------------ ------------- ------------- ------------
Net increase (decrease) in net assets 312,459,708 106,358,585 39,347,129 (176,692,534) 200,116,157 52,986,462
- ----------------------------------------------------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 281,331,559 174,972,974 135,625,845 1,039,173,853 839,057,696 786,071,234
End of period 593,791,267 281,331,559 174,972,974 862,481,319 1,039,173,853 839,057,696
------------ ----------- ------------ ------------- ------------- ------------
Undistributed (overdistributed) net
investment income (loss) at end
of period 2,274,226 1,284,980 (14,405) -- -- --
Accumulated net investment loss at
end of period -- -- -- (73,873) (2,185) (3,410)
SMALL CAP GROWTH FUND
-----------------------------------------
YEAR PERIOD YEAR
ENDED ENDED ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
INCREASE (DECREASE) IN NET ASSETS 2004 ($) 2003 (b)($) 2002 ($)
- ----------------------------------------------------------------------------------------
OPERATIONS
Net investment income (loss) (7,090,174) (3,758,177) (5,349,560)
Net realized gain (loss) on investments,
foreign currency transactions
and foreign capital gains tax 108,746,196 29,590,977 (116,601,064)
Net change in unrealized appreciation
/depreciation on investments,
foreign currency translations
and foreign capital gains tax (104,998,632) 124,510,064 (70,989,821)
------------ ----------- ------------
Net increase (decrease) resulting
from operations (3,342,610) 150,342,864 (192,940,445)
- ----------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income:
Class A -- -- --
Class B -- -- --
Class D -- -- --
Class Z -- -- --
Return of capital:
Class Z -- -- --
------------ ----------- ------------
Total distributions to shareholders -- -- --
- ----------------------------------------------------------------------------------------
NET CAPITAL SHARE TRANSACTIONS (91,256,656) (5,758,359) 68,005,564
------------ ----------- ------------
REDEMPTION FEES -- -- --
------------ ----------- ------------
Net increase (decrease) in net assets (94,599,266) 144,584,505 (124,934,881)
- ----------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 637,615,573 493,031,068 617,965,949
End of period 543,016,307 637,615,573 493,031,068
------------ ----------- ------------
Undistributed (overdistributed) net
investment income (loss) at end
of period -- 180,997 180,997
Accumulated net investment loss at
end of period -- -- --
(a) Class C shares were initially offered on October 13, 2003.
(b) The Fund changed its fiscal year end from December 31 to August 31.
(c) Effective November 1, 2002, the Fund began offering four classes of
shares: Class A, Class B, Class D and Class Z shares. Prior to November 1,
2002, the Fund was single class, which was subsequently renamed Class Z
shares.
(d) Effective November 1, 2002, the Fund began offering five classes of
shares: Class A, Class B, Class D, Class G and Class Z shares. Prior to
November 1, 2002, the Fund was single class, which was subsequently renamed
Class Z shares.
(e) Effective November 1, 2002, the Fund began offering six classes of shares:
Class A, Class B, Class D, Class G, Class T and Class Z shares. Prior to
November 1, 2002, the Fund was single class, which was subsequently renamed
Class Z shares.
See Accompanying Notes to Financial Statements.
Spread 130-131
STATEMENTS OF CHANGES IN NET ASSETS ____________________________________________
COLUMBIA FUNDS
REAL ESTATE EQUITY FUND TECHNOLOGY FUND
---------------------------------------- -----------------------------------------
YEAR PERIOD YEAR YEAR PERIOD YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
AUGUST 31, AUGUST 31, DECEMBER 31, AUGUST 31, AUGUST 31, DECEMBER 31,
INCREASE (DECREASE) IN NET ASSETS 2004 (a)($) 2003 (b)($) 2002 (c)($) 2004 (a)($) 2003 (b)($) 2002 (c)($)
- ------------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income (loss) 33,479,872 16,618,449 33,395,460 (500,247) (97,458) (122,568)
Net realized gain (loss) on investments,
foreign currency transactions and
futures contracts 103,930,894 8,176,522 (12,684,181) 3,148,988 3,262,715 (4,188,861)
Net change in unrealized appreciation
/depreciation on investments, foreign
currency translations and futures
contracts 86,151,012 124,974,925 (5,589,540) (1,040,511) 2,813,873 (748,526)
------------ ----------- ----------- ----------- ----------- ------------
Net increase (decrease) resulting
from operations 223,561,778 149,769,896 15,121,739 1,608,230 5,979,130 (5,059,955)
- ------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income:
Class A (812,573) (64,007) (11,804) -- -- --
Class B (181,510) (26,629) (12,009) -- -- --
Class C (21,166) -- -- -- -- --
Class D (96,766) (18,629) (4,519) -- -- --
Class G -- -- -- -- -- --
Class T -- -- -- -- -- --
Class Z (30,549,898) (11,791,170) (29,889,702) -- -- --
From net realized gains:
Class A (191,896) -- -- -- -- --
Class B (55,846) -- -- -- -- --
Class C (4,533) -- -- -- -- --
Class D (37,082) -- -- -- -- --
Class Z (8,007,605) -- -- -- -- --
Return of capital:
Class Z -- -- (3,915,328) -- -- --
------------ ----------- ----------- ----------- ----------- ------------
Total distributions to shareholders (39,958,875) (11,900,435) (33,833,362) -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
NET CAPITAL SHARE TRANSACTIONS (165,633,084) (9,506,449) 174,112,297 12,887,088 7,256,837 2,738,412
------------ ----------- ----------- ----------- ----------- ------------
Net increase (decrease) in net assets 17,969,819 128,363,012 155,400,674 14,495,318 13,235,967 (2,321,543)
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 905,353,520 776,990,508 621,589,834 21,299,487 8,063,520 10,385,063
End of period 923,323,339 905,353,520 776,990,508 35,794,805 21,299,487 8,063,520
------------ ----------- ----------- ----------- ----------- ------------
Undistributed (overdistributed) net
investment income at end of period 2,565,892 4,718,014 5,750,071 -- -- --
Accumulated net investment loss at end
of period -- -- -- (4,733) -- --
STRATEGIC INVESTOR FUND BALANCED FUND
---------------------------------------- ------------------------------------------
YEAR PERIOD YEAR YEAR PERIOD YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
AUGUST 31, AUGUST 31, DECEMBER 31, AUGUST 31, AUGUST 31, DECEMBER 31,
INCREASE (DECREASE) IN NET ASSETS 2004 (a)($) 2003 (b)($) 2002 (c)($) 2004 (a)($) 2003 (b)($) 2002 (c)($)
- ------------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income (loss) 1,155,970 1,290,099 1,880,227 10,289,328 8,623,814 20,794,186
Net realized gain (loss) on investments,
foreign currency transactions and
futures contracts 32,839,116 1,254,211 (27,776,780) 82,607,475 (2,740,428) (71,176,504)
Net change in unrealized appreciation
/depreciation on investments, foreign
currency translations and futures
contracts 11,369,353 47,457,001 (13,657,887) (57,419,638) 58,617,792 (68,893,518)
------------ ----------- ----------- ------------ ----------- ------------
Net increase (decrease) resulting
from operations 45,364,439 50,001,311 (39,554,440) 35,477,165 64,501,178 (119,275,836)
- ------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income:
Class A (258,188) -- -- (23,144) (2,855) (693)
Class B -- -- -- (36,893) (8,639) (2,254)
Class C -- -- -- (2,894) -- --
Class D -- -- -- (4,198) (2,920) (1,798)
Class G -- -- -- -- -- --
Class T -- -- -- -- -- --
Class Z (1,487,644) -- (1,839,312) (10,830,515) (6,954,163) (21,201,650)
From net realized gains:
Class A -- -- -- -- -- --
Class B -- -- -- -- -- --
Class C -- -- -- -- -- --
Class D -- -- -- -- -- --
Class Z -- -- (376,144) -- -- --
Return of capital:
Class Z -- -- -- -- -- --
------------ ----------- ----------- ------------ ----------- ------------
Total distributions to shareholders (1,745,832) -- (2,215,456) (10,897,644) (6,968,577) (21,206,395)
- ------------------------------------------------------------------------------------------------------------------------------------
NET CAPITAL SHARE TRANSACTIONS 74,083,888 (24,174,510) 168,107,411 (175,070,636) (81,831,327) (173,776,980)
------------ ----------- ----------- ------------ ----------- ------------
Net increase (decrease) in net assets 117,702,495 25,826,801 126,337,515 (150,491,115) (24,298,726) (314,259,211)
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 291,668,021 265,841,220 139,503,705 645,191,357 669,490,083 983,749,294
End of period 409,370,516 291,668,021 265,841,220 494,700,242 645,191,357 669,490,083
------------ ----------- ----------- ------------ ----------- ------------
Undistributed (overdistributed) net
investment income at end of period 403,906 1,354,437 62,338 1,334,170 1,622,249 (355,183)
Accumulated net investment loss at end
of period -- -- -- -- -- --
SHORT TERM BOND FUND
----------------------------------------
YEAR PERIOD YEAR
ENDED ENDED ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
INCREASE (DECREASE) IN NET ASSETS 2004 (a)($) 2003 (b)($) 2002 (d)($)
- --------------------------------------------------------------------------------------
OPERATIONS
Net investment income (loss) 11,677,205 7,314,353 3,936,510
Net realized gain (loss) on investments,
foreign currency transactions and
futures contracts 273,948 1,411,670 (5,253)
Net change in unrealized appreciation
/depreciation on investments, foreign
currency translations and futures
contracts 671,338 (5,882,484) 2,802,185
------------ ----------- -----------
Net increase (decrease) resulting
from operations 12,622,491 2,843,539 6,733,442
- --------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income:
Class A (587,965) (300,551) (7,886)
Class B (312,592) (163,965) (6,548)
Class C (32,292) -- --
Class D (283,218) (153,332) (9,865)
Class G (18,591) (19,560) (2,198)
Class T (518,577) (449,409) (48,546)
Class Z (9,814,113) (6,343,155) (3,843,068)
From net realized gains:
Class A -- -- --
Class B -- -- --
Class C -- -- --
Class D -- -- --
Class Z -- -- (18,783)
Return of capital:
Class Z -- -- --
------------ ----------- -----------
Total distributions to shareholders (11,567,348) (7,429,972) (3,936,894)
- --------------------------------------------------------------------------------------
NET CAPITAL SHARE TRANSACTIONS (24,733,033) 186,414,680 301,621,677
------------ ----------- -----------
Net increase (decrease) in net assets (23,677,890) 181,828,247 304,418,225
- --------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 549,176,077 367,347,830 62,929,605
End of period 525,498,187 549,176,077 367,347,830
------------ ----------- -----------
Undistributed (overdistributed) net
investment income at end of period 293,885 5,674 (204,761)
Accumulated net investment loss at end
of period -- -- --
(a) Class C shares were initially offered on October 13, 2003.
(b) The Fund changed its fiscal year end from December 31 to August 31.
(c) Effective November 1, 2002, the Fund began offering four classes of shares:
Class A, Class B, Class D and Class Z shares. Prior to November 1, 2002,
the Fund was single class, which was subsequently renamed Class Z shares.
(d) Effective November 1, 2002, the Fund began offering six classes of shares:
Class A, Class B, Class D, Class G, Class T and Class Z shares. Prior to
November 1, 2002, the Fund was single class, which was subsequently renamed
Class Z shares.
See Accompanying Notes to Financial Statements.
Spread 132-133
STATEMENTS OF CHANGES IN NET ASSETS ____________________________________________
COLUMBIA FUNDS
FIXED INCOME NATIONAL MUNICIPAL
SECURITIES FUND BOND FUND
---------------------------------------- -----------------------------------------
YEAR PERIOD YEAR YEAR PERIOD YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
AUGUST 31, AUGUST 31, DECEMBER 31, AUGUST 31, AUGUST 31, DECEMBER 31,
INCREASE (DECREASE) IN NET ASSETS 2004 (a)($) 2003 (b)($) 2002 (c)($) 2004 (a)($) 2003 (b)($) 2002 (c)($)
- ----------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income 16,516,684 13,690,036 24,670,569 543,600 430,023 603,412
Net realized gain (loss) on investments 6,873,389 9,807,289 (2,558,516) 128,356 56,187 88,597
Net change in unrealized appreciation
/depreciation on investments (509,297) (17,070,804) 14,601,556 251,062 (330,997) 631,224
------------ ----------- ----------- ----------- ------------ -----------
Net increase resulting from
operations 22,880,776 6,426,521 36,713,609 923,018 155,213 1,323,233
- ----------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income:
Class A (352,163) (81,788) (1,157) (30,673) (6,156) (200)
Class B (142,805) (56,382) (2,638) (19,451) (7,532) (232)
Class C (3,354) -- -- (17,369) -- --
Class D (76,542) (34,961) (1,013) (14,134) (5,576) (147)
Class Z (16,812,198) (14,154,256) (25,339,044) (460,894) (413,051) (598,784)
From net realized gains:
Class A -- -- -- (6,106) (310) (230)
Class B -- -- -- (5,641) (477) (784)
Class C -- -- -- (6,127) -- --
Class D -- -- -- (3,786) (337) (220)
Class Z -- -- -- (98,282) (12,706) (66,172)
------------ ----------- ----------- ----------- ------------ -----------
Total distributions to shareholders (17,387,062) (14,327,387) (25,343,852) (662,463) (446,145) (666,769)
- ----------------------------------------------------------------------------------------------------------------------------------
NET CAPITAL SHARE TRANSACTIONS (184,814,748) (21,870,137) 73,248,344 (1,232,294) (584,781) 2,233,945
------------ ----------- ----------- ----------- ------------ -----------
Net increase (decrease) in net assets (179,321,034) (29,771,003) 84,618,101 (971,739) (875,713) 2,890,409
- ----------------------------------------------------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 520,590,597 550,361,600 465,743,499 15,783,542 16,659,255 13,768,846
End of period 341,269,563 520,590,597 550,361,600 14,811,803 15,783,542 16,659,255
------------ ----------- ----------- ----------- ------------ -----------
Undistributed (overdistributed) net
investment income at end of period (766,809) (760,011) (885,594) 5,039 2,584 4,896
OREGON MUNICIPAL
BOND FUND HIGH YIELD FUND
---------------------------------------- -------------------------------------------
YEAR PERIOD YEAR YEAR PERIOD YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
AUGUST 31, AUGUST 31, DECEMBER 31, AUGUST 31, AUGUST 31, DECEMBER 31,
INCREASE (DECREASE) IN NET ASSETS 2004 (a)($) 2003 (b)($) 2002 (c)($) 2004 (a)($) 2003 (b)($) 2002 (c)($)
- -----------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income 18,807,129 14,184,403 22,413,341 102,105,979 50,179,150 29,377,465
Net realized gain (loss) on investments 3,418,754 3,354,784 3,932,577 23,256,561 2,667,555 (27,771,338)
Net change in unrealized appreciation
/depreciation on investments 9,460,520 (13,131,352) 17,775,246 23,594,415 7,100,037 9,777,957
------------ ----------- ----------- ------------- ------------- ------------
Net increase resulting from
operations 31,686,403 4,407,835 44,121,164 148,956,955 59,946,742 11,384,084
- -----------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS From net
From net investment income:
Class A (105,796) (24,517) (932) (16,842,377) (4,682,562) (111,753)
Class B (36,225) (14,008) (1,094) (5,543,127) (2,122,494) (63,166)
Class C (3,971) -- -- (651,730) -- --
Class D (26,303) (15,469) (1,673) (5,747,649) (2,591,969) (57,867)
Class Z (18,620,689) (14,116,676) (22,348,370) (81,901,552) (44,079,371) (30,110,118)
From net realized gains:
Class A (28,392) (1,127) (1,987) -- -- --
Class B (15,169) (532) (2,513) -- -- --
Class C (702) -- -- -- -- --
Class D (9,045) (496) (2,990) -- -- --
Class Z (5,411,625) (299,094) (5,015,648) -- -- --
------------ ----------- ----------- ------------- ------------- ------------
Total distributions to shareholders (24,257,917) (14,471,919) (27,375,207) (110,686,435) (53,476,396) (30,342,904)
- -----------------------------------------------------------------------------------------------------------------------------------
NET CAPITAL SHARE TRANSACTIONS (56,244,778) (10,834,612) 1,779,138 108,928,738 806,131,939 551,477,756
------------ ----------- ----------- ------------- ------------- ------------
Net increase (decrease) in net assets (48,816,292) (20,898,696) 18,525,095 147,199,258 812,602,285 532,518,936
- -----------------------------------------------------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 489,264,272 510,162,968 491,637,873 1,584,115,062 771,512,777 238,993,841
End of period 440,447,980 489,264,272 510,162,968 1,731,314,320 1,584,115,062 771,512,777
------------ ----------- ----------- ------------- ------------- ------------
Undistributed (overdistributed) net
investment income at end of period 129,015 141,548 131,976 (8,565,037) (3,743,314) (989,027)
DAILY INCOME COMPANY
-----------------------------------------------
YEAR PERIOD YEAR
ENDED ENDED ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
INCREASE (DECREASE) IN NET ASSETS 2004 ($) 2003 (b)($) 2002 ($)
- ---------------------------------------------------------------------------------------------
OPERATIONS
Net investment income 2,925,450 3,560,546 14,142,055
Net realized gain (loss) on investments -- -- --
Net change in unrealized appreciation
/depreciation on investments -- -- --
------------ ------------- -------------
Net increase resulting from
operations 2,925,450 3,560,546 14,142,055
- ---------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS From net
From net investment income:
Class A -- -- --
Class B -- -- --
Class C -- -- --
Class D -- -- --
Class Z (2,925,450) (3,560,546) (14,142,055)
From net realized gains:
Class A -- -- --
Class B -- -- --
Class C -- -- --
Class D -- -- --
Class Z -- -- --
------------ ------------- -------------
Total distributions to shareholders (2,925,450) (3,560,546) (14,142,055)
- ---------------------------------------------------------------------------------------------
NET CAPITAL SHARE TRANSACTIONS (237,050,335) (237,911,017) (117,460,299)
------------ ------------- -------------
Net increase (decrease) in net assets (237,050,335) (237,911,017) (117,460,299)
- ---------------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 898,163,881 1,136,074,898 1,253,535,197
End of period 661,113,546 898,163,881 1,136,074,898
------------ ------------- -------------
Undistributed (overdistributed) net
investment income at end of period -- -- --
(a) Class C shares were initially offered on October 13, 2003.
(b) The Fund changed its fiscal year end from December 31 to August 31.
(c) Effective November 1, 2002, the Fund began offering four classes of shares:
Class A, Class B, Class D and Class Z shares. Prior to November 1, 2002,
the Fund was single class, which was subsequently renamed Class Z shares.
See Accompanying Notes to Financial Statements.
Spread 134-135
STATEMENTS OF CHANGES IN NET ASSETS - CAPITAL STOCK ACTIVITY ___________________
COLUMBIA FUNDS
COMMON STOCK FUND
----------------------------------------------------------------------------------------
YEAR ENDED PERIOD ENDED YEAR ENDED
AUGUST 31, 2004 (a) AUGUST 31, 2003 (b) DECEMBER 31, 2002 (c)
-------------------------- --------------------------- --------------------------
SHARES DOLLARS ($) SHARES DOLLARS ($) SHARES DOLLARS ($)
- ---------------------------------------------------------------------------------------------------------------------------------
CLASS A
Subscriptions 64,115 1,177,263 10,945 170,123 2,138 31,961
Proceeds received in connection
with merger -- -- -- -- -- --
Distributions reinvested 36 655 -- -- 2 24
Redemptions (10,766) (202,298) (117) (1,878) -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase 53,385 975,620 10,828 168,245 2,140 31,985
CLASS B
Subscriptions 107,474 1,972,354 36,205 551,074 7,642 117,918
Distributions reinvested -- -- -- -- 25 365
Redemptions (28,529) (521,700) (7,327) (107,471) (328) (5,120)
----------- ------------ ----------- ------------- ----------- ------------
Net increase 78,945 1,450,654 28,878 443,603 7,339 113,163
CLASS C
Subscriptions 9,537 173,802 -- -- -- --
Redemptions (8,096) (153,076) -- -- -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase 1,441 20,726 -- -- -- --
CLASS D
Subscriptions 1,445 24,548 16,394 259,863 2,972 46,518
Distributions reinvested -- -- -- -- 7 105
Redemptions (808) (14,636) (11,846) (192,430) (968) (14,682)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) 637 9,912 4,548 67,433 2,011 31,941
CLASS G
Subscriptions -- -- -- -- -- --
Proceeds received in connection
with merger -- -- -- -- -- --
Redemptions -- -- -- -- -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) -- -- -- -- -- --
CLASS Z
Subscriptions 3,255,220 60,420,176 3,346,207 52,008,289 7,624,871 129,705,574*
Proceeds received in connection
with merger -- -- -- -- -- --
Distributions reinvested 124,008 2,261,915 -- -- 153,392 2,267,130
Redemptions (11,416,152) (212,061,766) (6,523,031) (102,375,697) (13,944,732) (232,525,563)
----------- ------------ ----------- ------------- ----------- ------------
Net decrease (8,036,924) (149,379,675) (3,176,824) (50,367,408) (6,166,469) (100,552,859)
GROWTH FUND
----------------------------------------------------------------------------------------
YEAR ENDED PERIOD ENDED YEAR ENDED
AUGUST 31, 2004 (a) AUGUST 31, 2003 (b) DECEMBER 31, 2002 (d)
-------------------------- -------------------------- --------------------------
SHARES DOLLARS ($) SHARES DOLLARS ($) SHARES DOLLARS ($)
- ---------------------------------------------------------------------------------------------------------------------------------
CLASS A
Subscriptions 60,274 1,566,301 50,514 1,127,877 6,415 135,724
Proceeds received in connection
with merger -- -- -- -- 142,906 3,133,045
Distributions reinvested -- -- -- -- -- --
Redemptions (44,945) (1,160,956) (26,317) (600,530) (1,651) (35,026)
----------- ------------ ----------- ------------- ----------- ------------
Net increase 15,329 405,345 24,197 527,347 147,670 3,233,743
CLASS B
Subscriptions 68,478 1,760,207 31,960 722,252 5,492 119,511
Distributions reinvested -- -- -- -- -- --
Redemptions (9,246) (238,352) (5,060) (113,169) -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase 59,232 1,521,855 26,900 609,083 5,492 119,511
CLASS C
Subscriptions 12,996 335,297 -- -- -- --
Redemptions (4,898) (126,885) -- -- -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase 8,098 208,412 -- -- -- --
CLASS D
Subscriptions 4,931 120,807 13,491 309,866 4,966 105,516
Distributions reinvested -- -- -- -- -- --
Redemptions (10,160) (252,432) (6,462) (148,435) -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (5,229) (131,625) 7,029 161,431 4,966 105,516
CLASS G
Subscriptions 4,481 115,330 5,008 110,114 780 16,449
Proceeds received in connection
with merger -- -- -- -- 668,443 14,636,657
Redemptions (81,959) (2,115,829) (58,288) (1,271,125) (11,143) (235,662)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (77,478) (2,000,499) (53,280) (1,161,011) 658,080 14,417,444
CLASS Z
Subscriptions 4,176,203 108,867,109 3,770,779 84,770,150 6,673,385 165,334,435
Proceeds received in connection
with merger -- -- -- -- 4,131,819 90,545,496
Distributions reinvested -- -- -- -- 100 2,235
Redemptions (9,500,046) (247,836,369) (5,869,216) (128,773,493) (14,167,826) (346,428,134)
----------- ------------ ----------- ------------- ----------- ------------
Net decrease (5,323,843) (138,969,260) (2,098,437) (44,003,343) (3,362,522) (90,545,968)
* Includes $4,174 of securities received in an in-kind transfer.
(a) Class C shares were initially offered on October 13, 2003.
(b) The Fund changed its fiscal year end from December 31 to August 31.
(c) Effective November 1, 2002, the Fund began offering four classes of
shares: Class A, Class B, Class D and Class Z shares. Prior to November 1,
2002, the Fund was single class, which was subsequently renamed Class Z
shares.
(d) Effective November 1, 2002, the Fund began offering five classes of
shares: Class A, Class B, Class D, Class G and Class Z shares. Prior to
November 1, 2002, the Fund was single class, which was subsequently renamed
Class Z shares.
See Accompanying Notes to Financial Statements.
Spread 136-137
STATEMENTS OF CHANGES IN NET ASSETS - CAPITAL STOCK ACTIVITY ___________________
COLUMBIA FUNDS
INTERNATIONAL STOCK FUND
----------------------------------------------------------------------------------------
YEAR ENDED PERIOD ENDED YEAR ENDED
AUGUST 31, 2004 (a) AUGUST 31, 2003 (b) DECEMBER 31, 2002 (c)
-------------------------- --------------------------- --------------------------
SHARES DOLLARS ($) SHARES DOLLARS ($) SHARES DOLLARS ($)
- ---------------------------------------------------------------------------------------------------------------------------------
CLASS A
Subscriptions 373,131 4,764,290 179,774 1,838,487 103,222 1,040,525
Proceeds received in connection
with merger -- -- -- -- 2,026,408 20,243,813
Redemptions (433,072) (5,595,729) (278,832) (2,814,836) (120,925) (1,215,758)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (59,941) (831,439) (99,058) (976,349) 2,008,705 20,068,580
CLASS B
Subscriptions 257,984 3,329,492 117,506 1,216,734 49,073 492,261
Proceeds received in connection
with merger -- -- -- -- 1,117,525 11,164,070
Redemptions (378,452) (4,865,635) (289,533) (2,950,070) (76,334) (768,135)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (120,468) (1,536,143) (172,027) (1,733,336) 1,090,264 10,888,196
CLASS C
Subscriptions 77,717 997,912 -- -- -- --
Redemptions (28,604) (374,843) -- -- -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase 49,113 623,069 -- -- -- --
CLASS D
Subscriptions 8,022 101,833 67,591 669,176 16,230 162,310
Proceeds received in connection
with merger -- -- -- -- 56,019 559,632
Redemptions (7,016) (89,891) (65,502) (642,271) (18,196) (181,537)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) 1,006 11,942 2,089 26,905 54,053 540,405
CLASS G
Subscriptions -- -- -- -- -- --
Proceeds received in connection
with merger -- -- -- -- -- --
Redemptions -- -- -- -- -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) -- -- -- -- -- --
CLASS T
Subscriptions -- -- -- -- -- --
Proceeds received in connection
with merger -- -- -- -- -- --
Redemptions -- -- -- -- -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) -- -- -- -- -- --
CLASS Z
Subscriptions 26,956,809 352,679,563 12,787,173 132,219,531 14,151,430 150,103,257
Proceeds received in connection
with merger -- -- -- -- 1,426,094 14,246,687
Distributions reinvested 44,157 563,444 -- -- 48,107 478,672
Redemptions (6,345,590) (84,115,655) (5,233,439) (52,772,540) (12,634,316) (134,815,113)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) 20,655,376 269,127,352 7,553,734 79,446,991 2,991,315 30,013,503
MID CAP GROWTH FUND
----------------------------------------------------------------------------------------
YEAR ENDED PERIOD ENDED YEAR ENDED
AUGUST 31, 2004 (a) AUGUST 31, 2003 (b) DECEMBER 31, 2002 (d)
-------------------------- --------------------------- --------------------------
SHARES DOLLARS ($) SHARES DOLLARS ($) SHARES DOLLARS ($)
- ---------------------------------------------------------------------------------------------------------------------------------
CLASS A
Subscriptions 291,660 5,434,656 389,366 6,472,166 15,672 237,394
Proceeds received in connection
with merger -- -- -- -- 68,335 1,049,181
Redemptions (280,956) (5,162,016) (219,073) (3,745,690) (4,112) (61,507)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) 10,704 272,640 170,293 2,726,476 79,895 1,225,068
CLASS B
Subscriptions 125,421 2,339,336 47,439 745,476 7,078 106,916
Proceeds received in connection
with merger -- -- -- -- 230,587 3,540,022
Redemptions (58,231) (1,066,216) (40,673) (637,724) (8,494) (127,352)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) 67,190 1,273,120 6,766 107,752 229,171 3,519,586
CLASS C
Subscriptions 35,421 677,522 -- -- -- --
Redemptions (5,599) (102,551) -- -- -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase 29,822 574,971 -- -- -- --
CLASS D
Subscriptions 3,419 61,969 18,375 281,516 11,403 172,855
Proceeds received in connection
with merger -- -- -- -- 18,373 282,040
Redemptions (8,721) (155,931) (6,698) (106,816) (431) (6,374)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (5,302) (93,962) 11,677 174,700 29,345 448,521
CLASS G
Subscriptions 1,362 25,257 1,272 19,333 222 3,363
Proceeds received in connection
with merger -- -- -- -- 51,696 794,054
Redemptions (7,466) (136,718) (7,460) (114,734) (913) (13,602)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (6,104) (111,461) (6,188) (95,401) 51,005 783,815
CLASS T
Subscriptions 26,462 498,501 22,853 357,740 1,181 17,735
Proceeds received in connection
with merger -- -- -- -- 1,766,763 27,163,275
Redemptions (195,050) (3,653,424) (127,510) (2,002,189) (12,506) (187,071)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (168,588) (3,154,923) (104,657) (1,644,449) 1,755,438 26,993,939
CLASS Z
Subscriptions 6,071,998 114,038,896 15,558,486 243,718,260 23,256,300 377,870,023
Proceeds received in connection
with merger -- -- -- -- 16,875,517 259,343,536
Distributions reinvested -- -- -- -- -- --
Redemptions (12,860,265) (240,032,810) (15,158,849) (237,069,456) (25,658,966) (417,250,145)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (6,788,267) (125,993,914) 399,637 6,648,804 14,472,851 219,963,414
(a) Class C shares were initially offered on October 13, 2003.
(b) The Fund changed its fiscal year end from December 31 to August 31.
(c) Effective November 1, 2002, the Fund began offering four classes of shares:
Class A, Class B, Class D and Class Z shares. Prior to November 1, 2002,
the Fund was single class, which was subsequently renamed Class Z shares.
(d) Effective November 1, 2002, the Fund began offering six classes of shares:
Class A, Class B, Class D, Class G, Class T and Class Z shares. Prior to
November 1, 2002, the Fund was single class, which was subsequently renamed
Class Z shares.
See Accompanying Notes to Financial Statements.
Spread 138-139
STATEMENTS OF CHANGES IN NET ASSETS - CAPITAL STOCK ACTIVITY ___________________
COLUMBIA FUNDS
SMALL CAP GROWTH FUND
----------------------------------------------------------------------------------------
YEAR ENDED PERIOD ENDED YEAR ENDED
AUGUST 31, 2004 AUGUST 31, 2003 (a) DECEMBER 31, 2002
-------------------------- --------------------------- --------------------------
SHARES DOLLARS ($) SHARES DOLLARS ($) SHARES DOLLARS ($)
- ---------------------------------------------------------------------------------------------------------------------------------
CLASS A
Subscriptions -- -- -- -- -- --
Distributions reinvested -- -- -- -- -- --
Redemptions -- -- -- -- -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase -- -- -- -- -- --
CLASS B
Subscriptions -- -- -- -- -- --
Distributions reinvested -- -- -- -- -- --
Redemptions -- -- -- -- -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase -- -- -- -- -- --
CLASS C
Subscriptions -- -- -- -- -- --
Distributions reinvested -- -- -- -- -- --
Redemptions -- -- -- -- -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase -- -- -- -- -- --
CLASS D
Subscriptions -- -- -- -- -- --
Distributions reinvested -- -- -- -- -- --
Redemptions -- -- -- -- -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) -- -- -- -- -- --
CLASS Z
Subscriptions 10,261,845 240,997,658 8,361,804 154,165,644 19,739,178 396,004,404
Distributions reinvested -- -- -- -- -- --
Redemptions (14,285,853) (332,254,314) (9,108,258) (159,924,003) (17,331,161) (327,998,840)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (4,024,008) (91,256,656) (746,454) (5,758,359) 2,408,017 68,005,564
REAL ESTATE EQUITY FUND
----------------------------------------------------------------------------------------
YEAR ENDED PERIOD ENDED YEAR ENDED
AUGUST 31, 2004 (b) AUGUST 31, 2003 (a) DECEMBER 31, 2002 (c)
-------------------------- --------------------------- --------------------------
SHARES DOLLARS ($) SHARES DOLLARS ($) SHARES DOLLARS ($)
- ---------------------------------------------------------------------------------------------------------------------------------
CLASS A
Subscriptions 1,626,030 36,784,752 655,533 12,613,973 50,286 889,637
Distributions reinvested 38,787 907,726 2,966 56,728 614 10,830
Redemptions (974,687) (22,619,991) (121,571) (2,319,879) (41) (701)
----------- ------------ ----------- ------------- ----------- ------------
Net increase 690,130 15,072,487 536,928 10,350,822 50,859 899,766
CLASS B
Subscriptions 294,726 6,857,490 178,356 3,330,663 59,855 1,057,426
Distributions reinvested 7,307 170,161 860 16,519 426 7,526
Redemptions (90,228) (2,141,291) (12,411) (241,060) (27) (486)
----------- ------------ ----------- ------------- ----------- ------------
Net increase 211,805 4,886,360 166,805 3,106,122 60,254 1,064,466
CLASS C
Subscriptions 106,764 2,516,283 -- -- -- --
Distributions reinvested 954 22,917 -- -- -- --
Redemptions (13,730) (323,033) -- -- -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase 93,988 2,216,167 -- -- -- --
CLASS D
Subscriptions 45,881 1,008,069 147,439 2,763,824 20,247 355,423
Distributions reinvested 4,705 107,738 775 14,883 234 4,139
Redemptions (56,804) (1,309,816) (3,893) (76,027) -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (6,218) (194,009) 144,321 2,702,680 20,481 359,562
CLASS Z
Subscriptions 15,372,264 353,978,184 19,396,080 358,557,734 33,091,005 607,721,107
Distributions reinvested 1,287,979 29,504,145 497,422 9,407,709 1,648,657 30,201,439
Redemptions (24,582,645) (571,096,418) (21,373,984) (393,631,516) (25,701,989) (466,134,043)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (7,922,402) (187,614,089) (1,480,482) (25,666,073) 9,037,673 171,788,503
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class C shares were initially offered on October 13, 2003.
(c) Effective November 1, 2002, the Fund began offering four classes of
shares: Class A, Class B, Class D and Class Z shares. Prior to November 1,
2002, the Fund was single class, which was subsequently renamed Class Z
shares.
See Accompanying Notes to Financial Statements.
Spread 140-141
STATEMENTS OF CHANGES IN NET ASSETS - CAPITAL STOCK ACTIVITY ___________________
COLUMBIA FUNDS
TECHNOLOGY FUND
----------------------------------------------------------------------------------------
YEAR ENDED PERIOD ENDED YEAR ENDED
AUGUST 31, 2004 (a) AUGUST 31, 2003 (b) DECEMBER 31, 2002 (c)
-------------------------- --------------------------- --------------------------
SHARES DOLLARS ($) SHARES DOLLARS ($) SHARES DOLLARS ($)
- ---------------------------------------------------------------------------------------------------------------------------------
CLASS A
Subscriptions 618,899 4,301,075 170,882 795,971 266 1,013
Proceeds received in connection
with merger -- -- -- -- -- --
Distributions reinvested -- -- -- -- -- --
Redemptions (249,120) (1,754,239) (107,548) (503,942) -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) 369,779 2,546,836 63,334 292,029 266 1,013
CLASS B
Subscriptions 504,341 3,487,212 256,020 1,267,177 1,777 6,709
Proceeds received in connection
with merger -- -- -- -- -- --
Redemptions (373,299) (2,552,196) (45,189) (239,637) -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase 131,042 935,016 210,831 1,027,540 1,777 6,709
CLASS C
Subscriptions 92,300 649,419 -- -- -- --
Redemptions (16,223) (116,780) -- -- -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase 76,077 532,639 -- -- -- --
CLASS D
Subscriptions 7,740 48,269 24,865 123,446 263 1,000
Proceeds received in connection
with merger -- -- -- -- -- --
Redemptions (6,929) (49,293) (22,619) (115,105) -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) 811 (1,024) 2,246 8,341 263 1,000
CLASS Z
Subscriptions 5,040,767 35,087,433 4,006,292 18,434,013 2,055,133 10,220,887
Proceeds received in connection
with merger -- -- -- -- -- --
Distributions reinvested -- -- -- -- -- --
Redemptions (3,732,749) (26,213,812) (2,819,286) (12,505,086) (1,621,025) (7,491,197)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) 1,308,018 8,873,621 1,187,006 5,928,927 434,108 2,729,690
STRATEGIC INVESTOR FUND
----------------------------------------------------------------------------------------
YEAR ENDED PERIOD ENDED YEAR ENDED
AUGUST 31, 2004 (a) AUGUST 31, 2003 (b) DECEMBER 31, 2002 (c)
-------------------------- --------------------------- --------------------------
SHARES DOLLARS ($) SHARES DOLLARS ($) SHARES DOLLARS ($)
- ---------------------------------------------------------------------------------------------------------------------------------
CLASS A
Subscriptions 2,239,525 40,978,091 75,306 1,062,103 16,466 220,586
Proceeds received in connection
with merger -- -- -- -- 4,196,653 54,514,520
Distributions reinvested 13,874 239,722 -- -- -- --
Redemptions (602,009) (10,711,424) (383,804) (5,265,019) (135,115) (1,789,207)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) 1,651,390 30,506,389 (308,498) (4,202,916) 4,078,004 52,945,899
CLASS B
Subscriptions 1,117,349 20,292,528 63,797 901,976 23,766 316,907
Proceeds received in connection
with merger -- -- -- -- 163,845 2,128,341
Redemptions (117,595) (2,110,515) (28,440) (390,511) (8,208) (108,351)
----------- ------------ ----------- ------------- ----------- ------------
Net increase 999,754 18,182,013 35,357 511,465 179,403 2,336,897
CLASS C
Subscriptions 842,913 15,346,291 -- -- -- --
Redemptions (27,681) (499,929) -- -- -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase 815,232 14,846,362 -- -- -- --
CLASS D
Subscriptions 1,168 20,852 27,649 397,532 1,170 15,708
Proceeds received in connection
with merger -- -- -- -- 27,645 359,105
Redemptions (7,595) (136,369) (10,199) (149,190) (1,702) (22,407)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (6,427) (115,517) 17,450 248,342 27,113 352,406
CLASS Z
Subscriptions 5,588,367 100,270,955 5,892,671 84,681,724 24,026,235 352,586,497
Proceeds received in connection
with merger -- -- -- -- 180,824 2,348,913
Distributions reinvested 85,074 1,470,072 -- -- 171,442 2,187,604
Redemptions (5,130,203) (91,076,386) (7,620,153) (105,413,125) (18,027,370) (244,650,805)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) 543,238 10,664,641 (1,727,482) (20,731,401) 6,351,131 112,472,209
(a) Class C shares were initially offered on October 13, 2003.
(b) The Fund changed its fiscal year end from December 31 to August 31.
(c) Effective November 1, 2002, the Fund began offering four classes of
shares: Class A, Class B, Class D and Class Z shares. Prior to November 1,
2002, the Fund was single class, which was subsequently renamed Class Z
shares.
See Accompanying Notes to Financial Statements.
Spread 142-143
STATEMENTS OF CHANGES IN NET ASSETS - CAPITAL STOCK ACTIVITY ___________________
COLUMBIA FUNDS
BALANCED FUND
----------------------------------------------------------------------------------------
YEAR ENDED PERIOD ENDED YEAR ENDED
AUGUST 31, 2004 (a) AUGUST 31, 2003 (b) DECEMBER 31, 2002 (c)
-------------------------- --------------------------- --------------------------
SHARES DOLLARS ($) SHARES DOLLARS ($) SHARES DOLLARS ($)
- ---------------------------------------------------------------------------------------------------------------------------------
CLASS A
Subscriptions 110,630 2,249,214 33,607 621,075 8,288 147,819
Distributions reinvested 1,059 21,473 155 2,818 38 668
Redemptions (16,827) (342,215) (7,153) (133,619) (1) (20)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) 94,862 1,928,472 26,609 490,274 8,325 148,467
CLASS B
Subscriptions 254,329 5,127,102 157,057 2,842,073 34,842 622,186
Distributions reinvested 1,523 30,867 424 7,724 118 2,064
Redemptions (63,198) (1,271,030) (17,361) (311,808) (285) (5,115)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) 192,654 3,886,939 140,120 2,537,989 34,675 619,135
CLASS C
Subscriptions 41,424 839,284 -- -- -- --
Distributions reinvested 136 2,777 -- -- -- --
Redemptions (4,752) (94,839) -- -- -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase 36,808 747,222 -- -- -- --
CLASS D
Subscriptions 7,349 141,785 27,277 487,690 25,391 456,181
Distributions reinvested 194 3,858 152 2,764 100 1,738
Redemptions (29,534) (593,961) (12,719) (224,597) -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (21,991) (448,318) 14,710 265,857 25,491 457,919
CLASS G
Subscriptions -- -- -- -- -- --
Proceeds received in connection
with merger -- -- -- -- -- --
Distributions reinvested -- -- -- -- -- --
Redemptions -- -- -- -- -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) -- -- -- -- -- --
CLASS T
Subscriptions -- -- -- -- -- --
Proceeds received in connection
with merger -- -- -- -- -- --
Distributions reinvested -- -- -- -- -- --
Redemptions -- -- -- -- -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) -- -- -- -- -- --
CLASS Z
Subscriptions 3,762,668 75,662,935 3,932,560 71,002,827 6,801,092 129,567,321
Proceeds received in connection
with merger -- -- -- -- -- --
Distributions reinvested 535,817 10,708,630 379,248 6,864,708 1,137,024 20,929,510
Redemptions (13,282,884) (267,556,516) (9,102,129) (162,992,982) (17,367,916) (325,499,332)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (8,984,399) (181,184,951) (4,790,321) (85,125,447) (9,429,800) (175,002,501)
SHORT TERM BOND FUND
----------------------------------------------------------------------------------------
YEAR ENDED PERIOD ENDED YEAR ENDED
AUGUST 31, 2004 (a) AUGUST 31, 2003 (b) DECEMBER 31, 2002 (d)
-------------------------- --------------------------- --------------------------
SHARES DOLLARS ($) SHARES DOLLARS ($) SHARES DOLLARS ($)
- ---------------------------------------------------------------------------------------------------------------------------------
CLASS A
Subscriptions 2,363,890 20,470,127 4,593,712 40,026,783 648,705 5,597,578
Distributions reinvested 55,629 481,353 23,346 203,076 712 6,168
Redemptions (3,483,902) (30,155,847) (935,142) (8,119,243) (10,279) (88,636)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (1,064,383) (9,204,367) 3,681,916 32,110,616 639,138 5,515,110
CLASS B
Subscriptions 1,020,370 8,811,024 2,912,411 25,355,903 724,659 6,252,006
Distributions reinvested 28,513 246,689 15,236 132,630 571 4,943
Redemptions (1,268,886) (10,976,173) (522,269) (4,540,064) (3,436) (29,668)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (220,003) (1,918,460) 2,405,378 20,948,469 721,794 6,227,281
CLASS C
Subscriptions 446,619 3,866,656 -- -- -- --
Distributions reinvested 3,243 28,007 -- -- -- --
Redemptions (87,871) (758,972) -- -- -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase 361,991 3,135,691 -- -- -- --
CLASS D
Subscriptions 195,345 1,693,396 1,835,008 15,983,699 630,014 5,435,948
Distributions reinvested 25,582 221,473 15,226 132,466 1,027 8,883
Redemptions (1,232,826) (10,651,859) (305,609) (2,657,104) (28,832) (248,791)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (1,011,899) (8,736,990) 1,544,625 13,459,061 602,209 5,196,040
CLASS G
Subscriptions 584 5,059 19,116 168,060 8,127 69,466
Proceeds received in connection
with merger -- -- -- -- 208,508 1,797,110
Distributions reinvested 2,071 17,922 2,089 18,273 235 2,041
Redemptions (67,631) (585,284) (50,125) (437,235) (730) (6,301)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (64,976) (562,303) (28,920) (250,902) 216,140 1,862,316
CLASS T
Subscriptions 49,312 426,415 364,019 3,195,681 63,115 544,886
Proceeds received in connection
with merger -- -- -- -- 3,594,178 30,982,225
Distributions reinvested 51,571 446,329 45,992 397,049 5,002 43,369
Redemptions (926,216) (7,999,639) (694,581) (6,031,954) (104,000) (898,480)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (825,333) (7,126,895) (284,570) (2,439,224) 3,558,295 30,672,000
CLASS Z
Subscriptions 27,479,655 237,930,286 33,169,321 289,096,535 16,131,131 138,763,864
Proceeds received in connection
with merger -- -- -- -- 22,121,411 190,685,846
Distributions reinvested 389,324 3,368,689 312,399 2,717,394 426,395 3,668,146
Redemptions (27,927,420) (241,618,684) (19,471,607) (169,227,269) (9,419,905) (80,968,926)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (58,441) (319,709) 14,010,113 122,586,660 29,259,032 252,148,930
(a) Class C shares were initially offered on October 13, 2003.
(b) The Fund changed its fiscal year end from December 31 to August 31.
(c) Effective November 1, 2002, the Fund began offering four classes of
shares: Class A, Class B, Class D and Class Z shares. Prior to November 1,
2002, the Fund was single class, which was subsequently renamed Class Z
shares.
(d) Effective November 1, 2002, the Fund began offering six classes of shares:
Class A, Class B, Class D, Class G, Class T and Class Z shares. Prior to
November 1, 2002, the Fund was single class, which was subsequently renamed
Class Z shares.
See Accompanying Notes to Financial Statements.
Spread 144-145
STATEMENTS OF CHANGES IN NET ASSETS - CAPITAL STOCK ACTIVITY ___________________
COLUMBIA FUNDS
FIXED INCOME SECURITIES FUND
----------------------------------------------------------------------------------------
YEAR ENDED PERIOD ENDED YEAR ENDED
AUGUST 31, 2004 (a) AUGUST 31, 2003 (b) DECEMBER 31, 2002 (c)
-------------------------- --------------------------- --------------------------
SHARES DOLLARS ($) SHARES DOLLARS ($) SHARES DOLLARS ($)
- ---------------------------------------------------------------------------------------------------------------------------------
CLASS A
Subscriptions 428,638 5,773,085 726,952 9,909,718 69,868 939,670
Distributions reinvested 23,362 314,190 4,853 65,705 19 252
Redemptions (220,544) (2,972,153) (239,158) (3,233,766) -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase 231,456 3,115,122 492,647 6,741,657 69,887 939,922
CLASS B
Subscriptions 118,362 1,602,183 262,519 3,564,890 108,490 1,456,255
Distributions reinvested 8,019 107,908 3,019 41,001 148 1,998
Redemptions (135,602) (1,820,197) (43,299) (588,947) (257) (3,454)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (9,221) (110,106) 222,239 3,016,944 108,381 1,454,799
CLASS C
Subscriptions 17,216 232,958 -- -- -- --
Distributions reinvested 209 2,809 -- -- -- --
Redemptions (5,682) (76,813) -- -- -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase 11,743 158,954 -- -- -- --
CLASS D
Subscriptions 2,595 34,899 226,577 3,084,131 31,506 421,439
Distributions reinvested 3,148 42,410 1,525 20,715 38 510
Redemptions (73,680) (981,085) (62,333) (849,629) -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (67,937) (903,776) 165,769 2,255,217 31,544 421,949
CLASS Z
Subscriptions 5,273,336 71,044,891 13,907,825 189,047,650 22,424,154 299,097,456
Distributions reinvested 1,165,214 15,695,834 1,009,178 13,708,472 1,948,592 25,971,318
Redemptions (20,329,678) (273,815,667) (17,459,206) (236,640,077) (19,120,878) (254,637,100)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (13,891,128) (187,074,942) (2,542,203) (33,883,955) 5,251,868 70,431,674
NATIONAL MUNICIPAL BOND FUND
----------------------------------------------------------------------------------------
YEAR ENDED PERIOD ENDED YEAR ENDED
AUGUST 31, 2004 (a) AUGUST 31, 2003 (b) DECEMBER 31, 2002 (c)
-------------------------- --------------------------- --------------------------
SHARES DOLLARS ($) SHARES DOLLARS ($) SHARES DOLLARS ($)
- ---------------------------------------------------------------------------------------------------------------------------------
CLASS A
Subscriptions 99,258 1,025,824 53,632 553,278 6,496 66,135
Distributions reinvested 2,972 30,460 578 5,930 41 425
Redemptions (16,680) (167,045) (21,357) (221,347) -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase 85,550 889,239 32,853 337,861 6,537 66,560
CLASS B
Subscriptions 27,156 280,129 59,020 608,830 21,761 222,588
Distributions reinvested 1,592 16,368 460 4,713 89 906
Redemptions (13,453) (138,405) (7,781) (79,981) (14,822) (150,595)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) 15,295 158,092 51,699 533,562 7,028 72,899
CLASS C
Subscriptions 79,238 814,330 -- -- -- --
Distributions reinvested 1,646 16,916 -- -- -- --
Redemptions (45,604) (462,894) -- -- -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase 35,280 368,352 -- -- -- --
CLASS D
Subscriptions 4,795 49,669 39,862 410,170 8,119 83,038
Distributions reinvested 831 8,544 291 2,986 32 322
Redemptions (7,399) (75,050) (1,214) (12,486) (3,292) (33,443)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (1,773) (16,837) 38,939 400,670 4,859 49,917
CLASS Z
Subscriptions 708,002 7,280,818 592,742 6,133,480 1,109,593 11,268,258
Distributions reinvested 45,767 470,822 37,677 387,633 64,411 649,959
Redemptions (1,011,506) (10,382,780) (812,144) (8,377,987) (981,956) (9,873,648)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (257,737) (2,631,140) (181,725) (1,856,874) 192,048 2,044,569
(a) Class C shares were initially offered on October 13, 2003.
(b) The Fund changed its fiscal year end from December 31 to August 31.
(c) Effective November 1, 2002, the Fund began offering four classes of
shares: Class A, Class B, Class D and Class Z shares. Prior to November 1,
2002, the Fund was single class, which was subsequently renamed Class Z
shares.
See Accompanying Notes to Financial Statements.
Spread 146-147
STATEMENTS OF CHANGES IN NET ASSETS - CAPITAL STOCK ACTIVITY ___________________
COLUMBIA FUNDS
OREGON MUNICIPAL BOND FUND
----------------------------------------------------------------------------------------
YEAR ENDED PERIOD ENDED YEAR ENDED
AUGUST 31, 2004 (a) AUGUST 31, 2003 (b) DECEMBER 31, 2002 (c)
-------------------------- --------------------------- --------------------------
SHARES DOLLARS ($) SHARES DOLLARS ($) SHARES DOLLARS ($)
- ---------------------------------------------------------------------------------------------------------------------------------
CLASS A
Subscriptions 170,654 2,095,832 143,490 1,801,219 37,901 471,456
Distributions reinvested 6,574 81,626 1,224 15,231 236 2,929
Redemptions (56,206) (688,255) (8,295) (103,112) -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase 121,022 1,489,203 136,419 1,713,338 38,137 474,385
CLASS B
Subscriptions 35,938 446,223 52,585 657,645 33,682 419,900
Distributions reinvested 2,314 28,769 334 4,158 170 2,114
Redemptions (24,250) (302,376) (1,187) (15,171) (3,990) (49,521)
----------- ------------ ----------- ------------- ----------- ------------
Net increase 14,002 172,616 51,732 646,632 29,862 372,493
CLASS C
Subscriptions 22,201 277,202 -- -- -- --
Distributions reinvested 227 2,808 -- -- -- --
Redemptions (84) (1,027) -- -- -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase 22,344 278,983 -- -- -- --
CLASS D
Subscriptions 12,020 148,564 51,705 648,502 37,686 472,508
Distributions reinvested 2,010 24,984 628 7,849 109 1,356
Redemptions (7,665) (95,185) (31,042) (389,956) (1,979) (24,640)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) 6,365 78,363 21,291 266,395 35,816 449,224
CLASS Z
Subscriptions 3,104,735 38,548,478 10,541,884 131,976,815 13,500,076 167,348,905
Distributions reinvested 1,524,565 18,948,258 910,985 11,381,588 1,896,736 23,528,226
Redemptions (9,361,486) (115,760,679) (12,534,293) (156,819,380) (15,383,205) (190,394,095)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (4,732,186) (58,263,943) (1,081,424) (13,460,977) 13,607 483,036
HIGH YIELD FUND
----------------------------------------------------------------------------------------
YEAR ENDED PERIOD ENDED YEAR ENDED
AUGUST 31, 2004 (a) AUGUST 31, 2003 (b) DECEMBER 31, 2002 (c)
-------------------------- --------------------------- --------------------------
SHARES DOLLARS ($) SHARES DOLLARS ($) SHARES DOLLARS ($)
- ---------------------------------------------------------------------------------------------------------------------------------
CLASS A
Subscriptions 26,673,537 230,909,589 25,041,610 213,784,547 4,382,301 36,558,214
Distributions reinvested 1,708,530 14,793,686 450,683 3,856,013 10,597 88,687
Redemptions (12,505,103) (108,035,805) (6,784,180) (57,991,328) (329,642) (2,758,792)
----------- ------------ ----------- ------------- ----------- ------------
Net increase 15,876,964 137,667,470 18,708,113 159,649,232 4,063,256 33,888,109
CLASS B
Subscriptions 3,063,956 26,566,619 9,063,139 77,330,185 2,007,189 16,716,021
Distributions reinvested 405,219 3,509,869 148,406 1,269,735 3,910 32,718
Redemptions (2,325,212) (20,086,982) (609,559) (5,189,719) (14,669) (122,617)
----------- ------------ ----------- ------------- ----------- ------------
Net increase 1,143,963 9,989,506 8,601,986 73,410,201 1,996,430 16,626,122
CLASS C
Subscriptions 2,692,176 23,449,925 -- -- -- --
Distributions reinvested 40,122 346,368 -- -- -- --
Redemptions (416,181) (3,598,943) -- -- -- --
----------- ------------ ----------- ------------- ----------- ------------
Net increase 2,316,117 20,197,350 -- -- -- --
CLASS D
Subscriptions 1,187,729 10,250,062 10,747,325 91,694,699 2,151,932 17,940,183
Distributions reinvested 379,149 3,285,854 172,120 1,472,483 4,089 34,217
Redemptions (3,773,325) (32,589,124) (873,716) (7,476,795) (154) (1,285)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (2,206,447) (19,053,208) 10,045,729 85,690,387 2,155,867 17,973,115
CLASS Z
Subscriptions 71,607,065 621,117,899 100,424,297 857,268,253 89,490,322 756,219,396
Distributions reinvested 5,291,757 45,884,199 3,670,269 31,357,503 3,386,949 28,634,236
Redemptions (81,442,188) (706,874,478) (47,029,601) (401,243,637) (35,810,741) (301,863,222)
----------- ------------ ----------- ------------- ----------- ------------
Net increase (decrease) (4,543,366) (39,872,380) 57,064,965 487,382,119 57,066,530 482,990,410
(a) Class C shares were initially offered on October 13, 2003.
(b) The Fund changed its fiscal year end from December 31 to August 31.
(c) Effective November 1, 2002, the Fund began offering four classes of
shares: Class A, Class B, Class D and Class Z shares. Prior to November 1,
2002, the Fund was single class, which was subsequently renamed Class Z
shares.
See Accompanying Notes to Financial Statements.
Spread 148-149
STATEMENTS OF CHANGES IN NET ASSETS - CAPITAL STOCK ACTIVITY ___________________
COLUMBIA FUNDS
DAILY INCOME COMPANY
------------------------------------------------------------------------------------------------
YEAR ENDED PERIOD ENDED YEAR ENDED
AUGUST 31, 2004 AUGUST 31, 2003 (a) DECEMBER 31, 2002
---------------------------- ---------------------------- --------------------------------
SHARES DOLLARS ($) SHARES DOLLARS ($) SHARES DOLLARS ($)
- ---------------------------------------------------------------------------------------------------------------------------------
CLASS Z
Subscriptions 522,717,108 522,717,108 468,052,097 468,052,097 1,214,530,352 1,214,530,352
Distributions reinvested 2,669,462 2,669,462 4,068,237 4,068,237 14,408,323 14,408,323
Redemptions (762,436,905) (762,436,905) (710,031,351) (710,031,351) (1,346,398,974) (1,346,398,974)
------------ ------------ ------------ ------------ -------------- --------------
Net decrease (237,050,335) (237,050,335) (237,911,017) (237,911,017) (117,460,299) (117,460,299)
(a) The Fund changed its fiscal year end from December 31 to August 31.
See Accompanying Notes to Financial Statements.
150
NOTES TO FINANCIAL STATEMENTS __________________________________________________
AUGUST 31, 2004 COLUMBIA FUNDS
NOTE 1. ORGANIZATION
The Columbia Funds are registered under the Investment Company Act of 1940 (the
"1940 Act"), as amended, as open-end management investment companies.
Information presented in these financial statements pertains to the following
Funds (individually referred to as a "Fund", collectively referred to as the
"Funds"):
Columbia Common Stock Fund
Columbia Growth Fund
Columbia International Stock Fund
Columbia Mid Cap Growth Fund
Columbia Small Cap Growth Fund
Columbia Real Estate Equity Fund
Columbia Technology Fund
Columbia Strategic Investor Fund
Columbia Balanced Fund
Columbia Short Term Bond Fund
Columbia Fixed Income Securities Fund
Columbia National Municipal Bond Fund
Columbia Oregon Municipal Bond Fund
Columbia High Yield Fund
Columbia Daily Income Company
All Funds are diversified except for the Columbia Real Estate Equity Fund,
Columbia Technology Fund and Columbia Oregon Municipal Bond Fund, which are
non-diversified.
INVESTMENT GOALS
The Columbia Common Stock Fund seeks capital appreciation by investing primarily
in common stocks of large capitalization, well-established companies. The
Columbia Growth Fund seeks capital appreciation by investing in stocks of
companies expected to experience long-term, above average earnings growth. The
Columbia International Stock Fund seeks long-term capital appreciation by
investing in stocks issued by companies from at least three countries outside
the United States. The Columbia Mid Cap Growth Fund seeks significant capital
appreciation by investing in stocks of companies with a market capitalization,
at the time of initial purchase, equal to or less than the largest stock in the
Russell MidCap Index. The Columbia Small Cap Growth Fund seeks capital
appreciation by investing in stocks of companies with a market capitalization,
at the time of initial purchase, equal to or less than the largest stock in the
S&P SmallCap 600 Index. The Columbia Real Estate Equity Fund seeks capital
appreciation and above-average income by investing in stocks of companies
principally engaged in the real estate industry, including real estate
investment trusts (REITs). The Columbia Technology Fund seeks capital
appreciation by investing in stocks of technology companies that may benefit
from technological improvements, advancements or developments. The Columbia
Strategic Investor Fund seeks long-term growth of capital by using a "value"
approach to investing primarily in common stocks. The Columbia Balanced Fund
seeks high total return by investing in common stocks and debt securities. The
Columbia Short Term Bond Fund seeks a high level of current income consistent
with a high degree of principal stability by investing primarily in short-term,
investment-grade, fixed income securities. The Columbia Fixed Income Securities
Fund seeks a high level of income by investing in a broad range of debt
securities with intermediate to long-term maturities. The Columbia National
Municipal Bond Fund seeks a high level of income exempt from federal income tax
by investing primarily in municipal securities issued by state and local
governments, their agencies and authorities, as well as the District of Columbia
and U.S. territories and possessions. The Columbia Oregon Municipal Bond Fund
seeks a high level of income exempt from federal and Oregon income tax by
investing primarily in municipal securities issued by the state of Oregon. The
Columbia High Yield Fund seeks a high level of income, with capital appreciation
as a secondary goal, by investing in non-investment-grade, corporate debt
securities. The Columbia Daily Income Company seeks a high level of income
consistent with the maintenance of liquidity and the preservation of capital by
investing primarily in high quality money market securities.
FUND SHARES
Each Fund may issue unlimited shares. Each of the Funds, except the Columbia
Growth Fund, Columbia Mid Cap Growth Fund, Columbia Small Cap Growth Fund,
Columbia Short Term Bond Fund and Columbia Daily Income Company, offer five
classes of shares: Class A, Class B, Class C, Class D and Class Z. The Columbia
Small Cap Growth Fund and Columbia Daily Income Company offer only Class Z
shares. The Columbia Growth Fund offers six classes of shares: Class A, Class B,
Class C, Class D, Class G and Class Z. The Columbia Mid Cap Growth Fund and
Columbia Short Term Bond Fund offer seven classes of shares:
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AUGUST 31, 2004 COLUMBIA FUNDS
Class A, Class B, Class C, Class D, Class G, Class T and Class Z. The Class C
shares commenced operations effective October 13, 2003 for all Funds except the
Columbia Small Cap Growth Fund and Columbia Daily Income Company. Each share
class has its own expense structure.
Class A and Class T shares are subject to a front-end sales charge based on the
amount of initial investment. Class A and Class T shares purchased without an
initial sales charge in accounts aggregating $1 million to $25 million at the
time of purchase are subject to a 1.00% contingent deferred sales charge
("CDSC") on shares sold within eighteen months of the time of purchase. Class B
and Class G shares are subject to a maximum CDSC of 5.00% based upon the holding
period after purchase. Class B shares will convert to Class A shares in a
certain number of years after purchase, depending on the program under which
shares were purchased. Class G shares will convert to Class T shares in eight
years after purchase. Class C shares are subject to a 1.00% CDSC on shares sold
within one year after purchase. Class D shares are subject to a front-end sales
charge of 1.00% and a 1.00% CDSC on shares sold within one year after purchase.
Effective October 13, 2003, Class D shares are closed to all new investors and
new accounts. Existing Class D shareholders will be able to make additional
purchases at any time. In addition, the Class D front-end sales charge of 1.00%
is waived effective October 13, 2003. Class Z shares are offered continuously at
net asset value. There are certain restrictions on the purchase of Class Z
shares, as described in each Fund's prospectus.
Effective October 13, 2003, the Columbia Special Fund, Columbia Small Cap Fund
and Columbia Strategic Value Fund were renamed Columbia Mid Cap Growth Fund,
Columbia Small Cap Growth Fund and Columbia Strategic Investor Fund,
respectively.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
USE OF ESTIMATES
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America ("GAAP") requires management
to make estimates and assumptions that affect the reported amounts of assets and
liabilities, the disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenue and expenses during
the reporting period. Actual results could differ from those estimates. The
following is a summary of significant accounting policies consistently followed
by the Funds in the preparation of their financial statements.
SECURITY VALUATION
Equity securities are valued at the last sale price on the principal exchange on
which they trade, except for securities traded on the NASDAQ, which are valued
at the NASDAQ official close price. Unlisted securities or listed securities for
which there were no sales during the day are valued at the closing bid price on
such exchanges or over-the-counter markets.
Debt securities generally are valued by a pricing service approved by the Funds'
Board of Directors, based upon market transactions for normal,
institutional-size trading units of similar securities. The services may use
various pricing techniques which take into account appropriate factors such as
yield, quality, coupon rate, maturity, type of issue, trading characteristics
and other data, as well as broker quotes. Debt securities for which quotations
are readily available are valued at an over-the-counter or exchange bid
quotation. Certain debt securities, which tend to be more thinly traded and of
lesser quality, are priced based on fundamental analysis of the financial
condition of the issuer and the estimated value of any collateral. Valuations
developed through pricing techniques may vary from the actual amounts realized
upon sale of the securities, and the potential variation may be greater for
those securities valued using fundamental analysis.
Short-term debt obligations maturing within 60 days are valued at amortized
cost, which approximates market value.
Investments in other investment companies are valued at net asset value.
Futures contracts are valued at the settlement price established each day by the
board of trade or exchange on which they are traded.
Foreign securities are generally valued at the last sale price on the foreign
exchange or market on which they trade. If any foreign share prices are not
readily available as a result of limited share activity, the securities are
valued at the last sale price of the local shares in the principal market in
which such securities are normally traded.
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AUGUST 31, 2004 COLUMBIA FUNDS
Generally, trading in foreign securities is substantially completed each day at
various times prior to the close of the New York Stock Exchange ("NYSE"). The
values of such securities used in computing the net asset value of the Funds'
shares are determined as of such times. Foreign currency exchange rates are
generally determined at 2:00 p.m. Eastern (U.S.) time. Occasionally, events
affecting the values of such foreign securities and such exchange rates may
occur between the times at which they are determined and the close of the
customary trading session of the NYSE, which would not be reflected in the
computation of the Funds' net asset value. If events materially affecting the
values of such foreign securities occur and it is determined that market
quotations are not reliable, then these foreign securities will be valued at
their fair value using procedures approved by the Board of Directors.
Investments for which market quotations are not readily available, or quotations
which management believes are not appropriate, are valued at fair value under
procedures approved by the Board of Directors.
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 fair 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.
Securities in the Columbia Daily Income Company are valued utilizing the
amortized cost valuation method permitted in accordance with Rule 2a-7 under the
1940 Act provided certain conditions are met. This method involves valuing a
portfolio security initially at its cost and thereafter assuming a constant
accretion or amortization to maturity of any discount or premium, respectively.
SECURITY TRANSACTIONS
Security transactions are accounted for on the trade date. Cost is determined
and gains (losses) are based upon the specific identification method for both
financial statement and federal income tax purposes.
FUTURES CONTRACTS
Certain Funds may invest in municipal and U.S. Treasury futures contracts. The
Funds will invest in these instruments to hedge against the effects of changes
in the value of portfolio securities due to anticipated changes in interest
rates and/or market conditions, for duration management, or when the
transactions are economically appropriate to the reduction of risk inherent in
the management of the Funds and not for trading purposes. The use of futures
contracts involves certain risks, which include: (1) imperfect correlation
between the price movement of the instruments and the underlying securities, (2)
inability to close out positions due to differing trading hours, or the
temporary absence of a liquid market, for either the instrument or the
underlying securities, or (3) an inaccurate prediction by Columbia Management
Advisors, Inc. of the future direction of interest rates. Any of these risks may
involve amounts exceeding the variation margin recorded in the Funds' Statement
of Assets and Liabilities at any given time.
Upon entering into a futures contract, each Fund deposits cash or securities
with the broker in an amount sufficient to meet the initial margin requirement.
Subsequent payments are made or received by the Funds equal to the daily change
in the contract value and are recorded as variation margin payable or receivable
and offset in unrealized gains or losses. Each Fund also identifies portfolio
securities as segregated with the custodian in a separate account in an amount
equal to the futures contract. The Funds recognize a realized gain or loss when
the contract is closed or expires.
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
Forward foreign currency exchange contracts are agreements to exchange one
currency for another at a future date at a specified price. These contracts are
used to minimize the exposure to foreign exchange rate fluctuations during the
period between trade and settlement date of the contracts. Certain Funds may
utilize forward foreign currency exchange contracts in connection with the
settlement of purchases and sales of securities. Certain Funds may also enter
into these contracts to hedge certain other foreign currency denominated assets.
Contracts to buy generally are used to acquire exposure to foreign currencies,
while contracts to sell are used to hedge the Funds' investments against
currency fluctuations. Forward currency contracts are valued daily at the
current exchange rate of the underlying currency, resulting in unrealized gains
(losses) which become realized at the time the foreign currency contracts are
closed or
153
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AUGUST 31, 2004 COLUMBIA FUNDS
mature. Realized and unrealized gains (losses) arising from such transactions
are included in net realized and unrealized gains (losses) on foreign currency
transactions. The use of forward currency contracts does not eliminate
fluctuations in the prices of the Funds' portfolio securities. While the maximum
potential loss from such contracts is the aggregate face value in U.S. dollars
at the time the contract was opened, exposure is typically limited to the change
in value of the contract (in U.S. dollars) over the period it remains open. The
Funds could also be exposed to risk if the counterparties of the contracts are
unable to fulfill the terms of the contracts.
REPURCHASE AGREEMENTS
Each Fund may engage in repurchase agreement transactions with institutions that
the Funds' investment advisor has determined are creditworthy. Each Fund,
through its custodian, receives delivery of underlying securities
collateralizing a repurchase agreement. Collateral is at least equal, at all
times, to the value of the repurchase obligation including interest. A
repurchase agreement transaction involves certain risks in the event of default
or insolvency of the counterparty. These risks include possible delays or
restrictions upon each Fund's ability to dispose of the underlying securities
and a possible decline in the value of the underlying securities during the
period while the Funds seek to assert their rights.
DELAYED DELIVERY SECURITIES
Certain Funds may trade securities on other than normal settlement terms,
including securities purchased or sold on a "when-issued" basis. This may
increase the risk if the other party to the transaction fails to deliver and
causes the Fund to subsequently invest at less advantageous prices. The Fund
identifies cash or liquid portfolio securities as segregated with the custodian
in an amount equal to the delayed delivery commitment.
INCOME RECOGNITION
Interest income is recorded on the accrual basis. Premium and discount are
amortized and accreted, respectively, on all debt securities. Corporate actions
and dividend income are recorded on the ex-date, except for certain foreign
securities which are recorded as soon after ex-date as the Funds become aware of
such, net of non-reclaimable tax withholdings. Awards from class action
litigation are recorded as a reduction of cost if the Funds still own the
applicable securities on the payment date. 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. If the Funds no longer own the
applicable securities, any distributions received in excess of income are
recorded as realized gains.
Effective March 1, 2004, the Strategic Investor Fund adopted the policy to
reduce cost of investments for financial statement purposes by the distributions
received in excess of income from REITs. The cumulative effect of this
accounting change did not impact the net assets of the Fund, but resulted in
reclassifications as follows:
DECREASE IN UNDISTRIBUTED
DECREASE IN COST NET INVESTMENT INCOME
---------------- -------------------------
$ 61,074 $ 61,074
The effect of the change for the year ended August 31, 2004 is as follows:
DECREASE IN
DECREASE IN COST DIVIDEND INCOME
---------------- ---------------
$ 24,216 $ 24,216
FOREIGN CURRENCY TRANSACTIONS
The values of all assets and liabilities quoted in foreign currencies are
translated into U.S. dollars at that day's exchange rates. Net realized and
unrealized gains (losses) on foreign currency transactions include gains
(losses) arising from the fluctuation in exchange rates between trade and
settlement dates on securities transactions, gains (losses) arising from the
disposition of foreign currency and currency gains (losses) between the accrual
and payment dates on dividends, interest income and foreign withholding taxes.
For financial statement purposes, the Funds do not distinguish that portion of
gains (losses) on investments which is due to changes in foreign exchange rates
from that which is due to changes in market prices of the investments. Such
fluctuations are included with the net realized and unrealized gains (losses) on
investments.
154
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AUGUST 31, 2004 COLUMBIA FUNDS
DETERMINATION OF CLASS NET ASSET VALUES
All income, expenses (other than class-specific expenses, as shown on the
Statements of Operations) and realized and unrealized gains (losses) are
allocated to each class of the Funds on a daily basis for purposes of
determining the net asset value of each class. Income and expenses are allocated
to each class based on the settled shares method, while realized and unrealized
gains (losses) are allocated based on the relative net assets of each class for
the Columbia Short Term Bond Fund, Columbia Fixed Income Securities Fund,
Columbia National Municipal Bond Fund, Columbia Oregon Municipal Bond Fund and
Columbia High Yield Bond Fund. For all other Funds, income, expenses (other than
class-specific expenses, as shown on the Statements of Operations), and realized
and unrealized gains (losses), are allocated to each class of a Fund, based on
the relative net assets of each class.
FEDERAL INCOME TAX STATUS
Each Fund intends to qualify each year as a "regulated investment company" under
Subchapter M of the Internal Revenue Code, as amended, and will distribute
substantially all of its taxable income, if any, for its tax year, and as such
will not be subject to federal income taxes. In addition, each Fund intends to
distribute in each calendar year substantially all of its net investment income,
capital gains and certain other amounts, if any, such that each Fund should not
be subject to federal excise tax. Therefore, no federal income or excise tax
provision is recorded.
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.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Dividends from net investment income of the Columbia Common Stock Fund, Columbia
Growth Fund, Columbia International Stock Fund, Columbia Mid Cap Growth Fund,
Columbia Small Cap Growth Fund, Columbia Technology Fund and Columbia Strategic
Investor Fund are declared and paid annually. Dividends from net investment
income of the Columbia Real Estate Equity Fund and Columbia Balanced Fund are
declared and paid quarterly. Dividends from net investment income of the
Columbia Short Term Bond Fund, Columbia Fixed Income Securities Fund, Columbia
National Municipal Bond Fund, Columbia Oregon Municipal Bond Fund, and Columbia
High Yield Fund are declared daily and paid monthly. Dividends from net
investment income of the Columbia Daily Income Company are declared daily and
paid daily. Net realized capital gains, if any, are distributed at least
annually for all Funds. Additional distributions of net investment income and
capital gains for each Fund may be made at the discretion of the Board of
Directors in accordance with federal income tax regulations.
NOTE 3. FEDERAL TAX INFORMATION
The timing and character of income and capital gain distributions are determined
in accordance with income tax regulations, which may differ from GAAP.
Reclassifications are made to the Funds' capital accounts for permanent tax
differences to reflect income and gains available for distribution (or available
capital loss carryforwards) under income tax regulations.
For the year ended August 31, 2004, permanent differences resulting primarily
from differing treatments for amortization/accretion adjustments, distribution
reclassifications, foreign capital gains tax, net operating loss
reclassifications, REIT adjustments, market discount reclassification
adjustments and foreign currency transactions were identified and reclassified
among the components of the Funds' net assets as follows:
155
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AUGUST 31, 2004 COLUMBIA FUNDS
UNDISTRIBUTED
(OVERDISTRIBUTED)
OR ACCUMULATED ACCUMULATED
NET INVESTMENT NET REALIZED PAID-IN
INCOME (LOSS) GAIN (LOSS) CAPITAL
---------------------------------------------------
Columbia Common Stock Fund .......... $ -- $ -- $ --
Columbia Growth Fund ................ 305,651 -- (305,651)
Columbia International Stock Fund ... (1,411,129) 1,411,129 --
Columbia Mid Cap Growth Fund ........ 7,722,780 68,419 (7,791,199)
Columbia Small Cap Growth Fund ...... 6,909,177 200,237 (7,109,414)
Columbia Real Estate Equity Fund .... (3,970,081) 9,666,660 (5,696,579)
Columbia Technology Fund ............ 495,514 4,082 (499,596)
Columbia Strategic Investor Fund .... (299,595) 299,595 --
Columbia Balanced Fund .............. 320,237 (320,237) --
Columbia Short Term Bond Fund ....... 178,354 (178,354) --
Columbia Fixed Income Securities Fund 863,580 (863,580) --
Columbia National Municipal Bond Fund 1,376 (1,375) (1)
Columbia Oregon Municipal Bond Fund . (26,678) 26,678 --
Columbia High Yield Fund ............ 3,758,733 (3,758,733) --
Columbia Daily Income Company ....... -- -- --
Net investment income and net realized gains (losses), as disclosed on the
Statements of Operations, and net assets were not affected by these
reclassifications.
The tax character of distributions paid during the year ended
August 31, 2004, the period ended August 31, 2003 and the year ended December
31, 2002 was as follows:
YEAR ENDED AUGUST 31, 2004
----------------------------------------------------------
TAX-EXEMPT ORDINARY LONG-TERM
INCOME INCOME* CAPITAL GAINS TOTAL
----------------------------------------------------------
Columbia Common Stock Fund .......... $ -- $ 2,317,519 $ -- $ 2,317,519
Columbia International Stock Fund ... -- 1,290,808 -- 1,290,808
Columbia Real Estate Equity Fund .... -- 32,144,710 7,814,165 39,958,875
Columbia Strategic Investor Fund .... -- 1,745,832 -- 1,745,832
Columbia Balanced Fund .............. -- 10,897,644 -- 10,897,644
Columbia Short Term Bond Fund ....... -- 11,567,348 -- 11,567,348
Columbia Fixed Income Securities Fund -- 17,387,062 -- 17,387,062
Columbia National Municipal Bond Fund 540,162 7,054 115,247 662,463
Columbia Oregon Municipal Bond Fund . 18,792,984 95,636 5,369,297 24,257,917
Columbia High Yield Fund ............ -- 110,686,435 -- 110,686,435
Columbia Daily Income Fund .......... -- 2,925,450 -- 2,925,450
PERIOD ENDED AUGUST 31, 2003
----------------------------------------------------------
TAX-EXEMPT ORDINARY LONG-TERM
INCOME INCOME* CAPITAL GAINS TOTAL
----------------------------------------------------------
Columbia Real Estate Equity Fund .... $ -- $ 11,900,435 $ -- $ 11,900,435
Columbia Balanced Fund .............. -- 6,968,577 -- 6,968,577
Columbia Short Term Bond Fund ....... -- 7,429,972 -- 7,429,972
Columbia Fixed Income Securities Fund -- 14,327,387 -- 14,327,387
Columbia National Municipal Bond Fund 432,316 2,844 10,985 446,145
Columbia Oregon Municipal Bond Fund . 14,166,830 24,229 280,860 14,471,919
Columbia High Yield Fund ............ -- 53,476,396 -- 53,476,396
Columbia Daily Income Company ....... -- 3,560,546 -- 3,560,546
156
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AUGUST 31, 2004 COLUMBIA FUNDS
YEAR ENDED DECEMBER 31, 2002
--------------------------------------------------------------------------
TAX-EXEMPT ORDINARY LONG-TERM TAX RETURN
INCOME INCOME* CAPITAL GAINS OF CAPITAL TOTAL
--------------------------------------------------------------------------
Columbia Common Stock Fund ............ $ -- $ 2,325,610 $ -- $ -- $ 2,325,610
Columbia International Stock Fund ..... -- 102,850 -- 403,799 506,649
Columbia Real Estate Equity Fund ...... -- 29,918,034 -- 3,915,328 33,833,362
Columbia Strategic Investor Fund ...... -- 2,143,571 71,885 -- 2,215,456
Columbia Balanced Fund ................ -- 21,206,395 -- -- 21,206,395
Columbia Short Term Bond Fund ......... -- 3,936,894 -- -- 3,936,894
Columbia Fixed Income Securities Fund . -- 25,343,852 -- -- 25,343,852
Columbia National Municipal Bond Fund . 599,360 2,439 64,967 -- 666,769
Columbia Oregon Municipal Bond Fund ... 22,352,069 200,224 4,822,914 -- 27,375,207
Columbia High Yield Fund .............. -- 30,342,904 -- -- 30,342,904
Columbia Daily Income Fund ............ -- 14,142,055 -- -- 14,142,055
* For tax purposes short-term capital gains distribution, if any, are considered
ordinary income distributions.
As of August 31, 2004, the components of distributable earnings on a tax basis
were as follows:
UNDISTRIBUTED UNDISTRIBUTED UNDISTRIBUTED
TAX-EXEMPT ORDINARY LONG-TERM NET UNREALIZED
INCOME INCOME CAPITAL GAINS APPRECIATION*
-------------------------------------------------------------------
Columbia Common Stock Fund .......... $ -- $ 776,105 $ -- $ 20,173,630
Columbia Growth Fund ................ -- -- -- 100,222,104
Columbia International Stock Fund ... -- 2,317,362 -- 39,872,784
Columbia Mid Cap Growth Fund ........ -- -- -- 23,420,933
Columbia Small Cap Growth Fund ...... -- -- -- 38,875,659
Columbia Real Estate Equity Fund** .. -- 10,982,843 88,123,111 274,609,973
Columbia Technology Fund ............ -- -- -- 1,365,887
Columbia Strategic Investor Fund .... -- 416,865 4,331,771 51,571,760
Columbia Balanced Fund .............. -- 1,643,641 -- 17,021,147
Columbia Short Term Bond Fund ....... -- 767,056 -- 1,827,552
Columbia Fixed Income Securities Fund -- 77,650 3,120,677 5,716,671
Columbia National Municipal Bond Fund 10,530 -- 63,102 679,092
Columbia Oregon Municipal Bond Fund . 524,781 259,694 1,092,335 20,946,896
Columbia High Yield Fund ............ -- 3,783,742 -- 31,285,729
Columbia Daily Income Fund .......... -- 5,169 -- --
* The differences between book-basis and tax-basis net unrealized appreciation
are primarily due to deferral of losses from wash sales and
amortization/accretion adjustments.
** Amount is estimated as of August 31, 2004.
157
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AUGUST 31, 2004 COLUMBIA FUNDS
Unrealized appreciation and depreciation at August 31, 2004, based on cost of
investments for federal income tax purposes, and excluding any unrealized
appreciation and depreciation from changes in the value of other assets and
liabilities resulting from changes in exchange rates, was:
UNREALIZED UNREALIZED NET UNREALIZED
APPRECIATION DEPRECIATION APPRECIATION
----------------------------------------------------
Columbia Common Stock Fund ............. $ 26,118,716 $ (5,945,086) $ 20,173,630
Columbia Growth Fund ................... 127,359,789 (27,137,685) 100,222,104
Columbia International Stock Fund ...... 55,639,502 (15,739,231) 39,900,271
Columbia Mid Cap Growth Fund ........... 68,505,431 (45,084,517) 23,420,914
Columbia Small Cap Growth Fund ......... 82,990,653 (44,114,994) 38,875,659
Columbia Real Estate Equity Fund ....... 282,636,613 (8,026,640) 274,609,973
Columbia Technology Fund ............... 2,971,294 (1,605,407) 1,365,887
Columbia Strategic Investor Fund ....... 55,097,155 (3,525,395) 51,571,760
Columbia Balanced Fund ................. 23,298,282 (6,277,135) 17,021,147
Columbia Short Term Bond Fund .......... 3,195,538 (1,367,986) 1,827,552
Columbia Fixed Income Securities Fund... 6,824,627 (1,107,956) 5,716,671
Columbia National Municipal Bond Fund... 684,523 (5,431) 679,092
Columbia Oregon Municipal Bond Fund .... 24,283,152 (3,336,256) 20,946,896
Columbia High Yield Fund ............... 41,149,475 (9,863,746) 31,285,729
The following capital loss carryforwards, determined as of August 31, 2004, may
be 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 EXPIRATION
2006 2007 2008 2009 2010 2011 TOTAL
--------- ------------ ------------ ------------ ------------- ------------ -------------
Columbia Common
Stock Fund.................. $ -- $ -- $ -- $ -- $ 49,129,624 $ 18,452,682 $ 67,582,306
Columbia Growth Fund ....... -- 12,669,149 7,477,47 97,550,243 201,393,752 43,705,919 362,796,542
Columbia International
Stock Fund.................. -- 3,992,699 4,566,169 659,591 12,463,383 9,023,330 30,705,172
Columbia Mid Cap
Growth Fund................. -- -- 13,161,549 15,799,915 95,645,403 4,954,493 129,561,360
Columbia Small Cap
Growth Fund................. -- -- -- -- 97,865,374 -- 97,865,374
Columbia Technology Fund ... -- -- -- -- 1,969,604 -- 1,969,604
Columbia Balanced
Fund ....................... -- -- -- -- 56,019,395 10,165,186 66,184,581
Columbia Short Term
Bond Fund................... 256,035 -- 1,103,186 -- -- -- 1,359,221
Columbia High Yield Fund ... -- -- -- -- 16,290,578 -- 16,290,578
Columbia Daily Income
Company..................... -- -- -- -- -- 320 320
Of the capital loss carryforwards attributable to Columbia Growth Fund,
$20,146,628 ($12,669,149 expiring 08/31/07 and $7,477,479 expiring 08/31/08)
remains from the Columbia Growth Fund's merger with Galaxy Large Cap Growth Fund
(See Note 12).
Of the capital loss carryforwards attributable to Columbia International Stock
Fund, $5,920,504 ($3,992,699 expiring 08/31/07 and $1,927,805 expiring 08/31/08)
and $3,297,955 ($2,638,364 expiring 08/31/08 and $659,591 expiring 08/31/09)
remain from the Columbia International Stock Fund's merger with Liberty Newport
International Equity Fund and Stein Roe International Fund, respectively (See
Note 12).
Of the capital loss carryforwards attributable to Columbia Mid Cap Growth Fund,
$6,884,210 ($5,507,368 expiring 08/31/08 and $1,376,842 expiring
158
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AUGUST 31, 2004 COLUMBIA FUNDS
08/31/09) and $19,700,034 ($7,654,181 expiring 08/31/08 and $12,045,853 expiring
08/31/09) remain from the Columbia Mid Cap Growth Fund's merger with Liberty Mid
Cap Growth Fund and Stein Roe Capital Opportunities Fund, respectively (See Note
12).
Of the capital loss carryforwards attributable to Columbia Short Term Bond Fund,
$1,359,221 ($256,035 expiring 08/31/06 and $1,103,186 expiring 08/31/08) remain
from the Columbia Short Term Bond Fund's merger with Galaxy Short Term Bond Fund
(See Note 12).
The following capital loss carryforwards, determined as of August 31, 2004, have
been utilized, as follows:
Columbia Common Stock Fund............................... $ 76,184,532
Columbia Growth Fund..................................... 75,408,256
Columbia International Stock Fund........................ 32,541,554
Columbia Mid Cap Growth Fund............................. 134,722,317
Columbia Small Cap Growth Fund........................... 107,502,797
Columbia Real Estate Equity Fund......................... 10,403,064
Columbia Technology Fund................................. 3,844,354
Columbia Strategic Investor Fund......................... 28,018,886
Columbia Balanced Fund................................... 79,618,254
Columbia Short Term Bond Fund............................ 747,167
Columbia Fixed Income Securities Fund.................... 2,593,677
Columbia High Yield Fund................................. 19,398,306
Under current tax rules, certain currency and capital losses realized after
October 31 may be deferred and treated as occurring on the first day of the
following fiscal year. As of August 31, 2004, post-October currency losses and
capital losses attributed to security transactions were deferred to September 1,
2004, as follows:
CURRENCY CAPITAL
LOSSES LOSSES
----------- ---------
Columbia Mid Cap Growth Fund.............. $ 68,420 $ --
Columbia Technology Fund.................. 3,530 --
Columbia Short Term Bond Fund............. -- 344,395
Columbia Daily Income Company ............ -- 381
NOTE 4. FEES AND COMPENSATION PAID TO AFFILIATES
Columbia Management Advisors, Inc. ("Columbia") is the investment advisor to the
Funds. Prior to April 1, 2004, Columbia was an indirect, wholly owned subsidiary
of FleetBoston Financial Corporation ("FleetBoston"). Effective April 1, 2004,
FleetBoston, including the Funds' investment advisor, transfer agent and
distributor, was acquired by Bank of America Corporation ("BOA"). The
acquisition did not change the way the Funds are managed, the investment
personnel assigned to manage the Funds or the fees paid by the Funds.
INVESTMENT ADVISORY FEE
Columbia provides administrative and other services to the Funds in addition to
investment advisory services. Columbia receives a monthly investment advisory
fee based on the Fund's average daily net assets at the following annual rates:
ANNUAL
FEE
RATE
-------
Columbia Common Stock Fund 0.600%
Columbia Small Cap Growth Fund 1.000%
Columbia Real Estate Equity Fund 0.750%
Columbia Technology Fund 1.000%
Columbia Strategic Investor Fund 0.750%
Columbia Balanced Fund 0.500%
Columbia Short Term Bond Fund 0.500%
Columbia Fixed Income Securities Fund 0.500%
Columbia National Municipal Bond Fund 0.500%
Columbia Oregon Municipal Bond Fund 0.500%
Columbia High Yield Fund 0.600%
FEES ON FEES ON FEES ON FEES ON
AVERAGE AVERAGE AVERAGE AVERAGE
NET ASSETS NET ASSETS NET ASSETS NET ASSETS
FIRST $200 NEXT $300 NEXT $500 OVER $1
MILLION MILLION MILLION BILLION
---------- ---------- ---------- ----------
Columbia
Growth Fund 0.750% 0.625% 0.500% 0.500%
Columbia
International
Stock Fund 1.000% 1.000% 0.950% 0.900%
Columbia
Mid Cap
Growth Fund 1.000% 1.000% 0.750% 0.750%
Columbia
Daily Income
Company 0.500% 0.500% 0.450% 0.400%
159
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AUGUST 31, 2004 COLUMBIA FUNDS
Effective January 1, 2004, Columbia has voluntarily agreed to waive a portion of
its investment advisory fee for the Columbia International Stock Fund at an
annual rate of 0.10% of the Columbia International Stock Fund's average daily
net assets. Columbia, at its discretion, may revise or discontinue this
arrangement any time.
For the year ended August 31, 2004, the effective investment advisory fee rates
for the Columbia Growth Fund, Columbia International Stock Fund, Columbia Mid
Cap Growth Fund and Columbia Daily Income Company were 0.60%, 0.92%, 0.87% and
0.48%, respectively.
PRICING AND BOOKKEEPING FEES
Columbia is responsible for providing pricing and bookkeeping services to the
Funds under a pricing, bookkeeping and fund administration agreement. Under a
separate agreement (the "Outsourcing Agreement"), Columbia has delegated certain
of those functions to State Street Corporation ("State Street"). As a result,
Columbia pays the total fees collected to State Street under the Outsourcing
Agreement.
Under its pricing, bookkeeping and fund administration agreement with the Funds,
Columbia receives from each Fund an annual flat financial accounting fee of
$25,000, an annual flat financial reporting fee of $19,965 and a monthly
financial accounting fee at the annual rate of 0.02% of the average daily net
assets of each Fund. The fee for a Fund in any year will not exceed $150,000.
Prior to November 1, 2003, Columbia was entitled to receive a monthly pricing
and bookkeeping fee at the annual rate of 0.01% of the average daily net assets
of each Fund. The fee for a Fund in any year was not less than $25,000 and did
not exceed $150,000.
The Funds also pay additional fees for pricing services based on the number of
securities held by each Fund. For the year ended August 31, 2004, the effective
pricing and bookkeeping fee rates for the Funds, inclusive of out-of-pocket
expenses, were as follows:
Columbia Common Stock Fund 0.031%
Columbia Growth Fund 0.016%
Columbia International Stock Fund 0.027%
Columbia Mid Cap Growth Fund 0.015%
Columbia Small Cap Growth Fund 0.021%
Columbia Real Estate Equity Fund 0.016%
Columbia Technology Fund 0.160%
Columbia Strategic Investor Fund 0.033%
Columbia Balanced Fund 0.030%
Columbia Short Term Bond Fund 0.033%
Columbia Fixed Income Securities Fund 0.035%
Columbia National Municipal Bond Fund 0.428%
Columbia Oregon Municipal Bond Fund 0.039%
Columbia High Yield Fund 0.011%
Columbia Daily Income Company 0.019%
TRANSFER AGENT FEE
Columbia Funds Services, Inc. (the "Transfer Agent"), an affiliate of Columbia,
provides shareholder services to the Funds. For such services, the Transfer
Agent receives a fee per open account, in addition to reimbursement for certain
out-of-pocket expenses. The annual charges per open account for the transfer
agent fees are as follows:
PER OPEN
ACCOUNT
FEE RATE
----------
Columbia Common Stock Fund $ 28.00
Columbia Growth Fund $ 28.00
Columbia International Stock Fund $ 28.00
Columbia Mid Cap Growth Fund $ 28.00
Columbia Small Cap Growth Fund $ 28.00
Columbia Real Estate Equity Fund $ 28.00
Columbia Technology Fund $ 28.00
Columbia Strategic Investor Fund $ 28.00
Columbia Balanced Fund $ 28.00
Columbia Short Term Bond Fund $ 34.00
Columbia Fixed Income Securities Fund $ 34.00
Columbia National Municipal Bond Fund $ 34.00
Columbia Oregon Municipal Bond Fund $ 34.00
Columbia High Yield Fund $ 34.00
Columbia Daily Income Company $ 33.50
160
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AUGUST 31, 2004 COLUMBIA FUNDS
Prior to November 1, 2003, the Transfer Agent was entitled to receive a transfer
agent fee for all Funds' Class Z shares, with the exception of Columbia National
Municipal Bond Fund, based on the number of shareholder accounts or a minimum of
$1,500 per month. Columbia National Municipal Bond Fund was not subject to the
monthly $1,500 fee minimum. For Class A, Class B, Class C, Class D, Class G and
Class T shares, the Transfer Agent was entitled to receive a monthly fee at the
lower of: 1) the monthly fee for Class Z shares described above as applied to
Class A, Class B, Class C, Class D, Class G and Class T shares, or 2) a fee
based upon an annual rate of 0.06% of the average daily net assets attributable
to Class A, Class B, Class C, Class D, Class G and Class T shares, plus a per
transaction fee and a per account fee. The Transfer Agent was also entitled to
receive reimbursement for certain out-of-pocket expenses.
Effective June 1, 2004, the Transfer Agent has voluntarily agreed to waive a
portion of the transfer agent fees for the Columbia International Stock Fund,
Columbia Mid Cap Growth Fund and Columbia Strategic Investor Fund at the annual
rates of 0.11%, 0.05% and 0.03%, respectively.
Prior to June 1, 2004, the Transfer Agent contractually waived transfer agent
fees for the Funds based on each class' average daily net assets at the
following annual rates:
CLASS A CLASS B CLASS C CLASS D CLASS Z
------- ------- ------- ------- -------
Columbia
International
Stock Fund............. -- 0.11% 0.36% 0.63% 0.09%
Columbia
Mid Cap
Growth Fund............ 0.01% 0.12% 0.09% 0.09% 0.05%
Columbia
Strategic
Investor Fund.......... -- 0.23% 0.15% 0.15% 0.03%
Effective October 13, 2003, Liberty Funds Services, Inc. was renamed Columbia
Funds Services, Inc.
UNDERWRITING DISCOUNTS, SERVICE AND DISTRIBUTION FEES
Columbia Funds Distributor, Inc., (the "Distributor"), an affiliate of Columbia,
is the principal underwriter of the Funds. For the year ended August 31, 2004,
the Distributor has retained net underwriting discounts and CDSC fees as
follows:
FRONT-END
SALES CHARGE CONTINGENT DEFERRED SALES CHARGE (CDSC)
----------------- ----------------------------------------------------------------
CLASS A CLASS T CLASS A CLASS B CLASS C CLASS D CLASS G CLASS T
------- ------- ------- --------- --------- ------- --------- -------
Columbia
Common Stock Fund .......... $ 1,831 $ -- $ -- $ 2,263 $ 68,841 $ -- $ -- $ --
Columbia Growth Fund ....... 4,884 -- 9 3,110 36 321 26,155 --
Columbia
International Stock Fund.... 7,709 -- 19 19,916 136 28 -- --
Columbia
Mid Cap Growth Fund ........ 8,809 208 -- 13,824 163 121 3,042 --
Columbia
Real Estate Equity Fund.... 32,163 -- 25,000 23,451 841 5,486 -- --
Columbia Technology Fund.... 8,021 -- -- 40,537 634 260 -- --
Columbia
Strategic Investor Fund.... 93,136 -- 487 26,857 1,231 10 -- --
Columbia Balanced Fund ..... 4,250 -- -- 17,399 226 66 -- --
Columbia
Short Term Bond Fund ....... 25,773 -- 47,961 135,786 1,353 19,899 2,079 --
Columbia Fixed Income
Securities Fund ............ 4,904 -- 728 27,764 -- 1,530 -- --
Columbia National
Municipal Bond Fund ........ 3,550 -- -- 1,512 936 48 -- --
Columbia Oregon
Municipal Bond Fund ........ 2,214 -- -- 9,827 -- 819 -- --
Columbia High Yield Fund ... 97,655 -- 66,542 320,253 12,611 70,511 -- --
161
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AUGUST 31, 2004 COLUMBIA FUNDS
The Funds have adopted a 12b-1 plan (the "Plan") which requires the payment of a
monthly service and distribution fee to the Distributor based on the average
daily net assets of each Fund at the following annual rates:
DISTRIBUTION FEE
---------------------------------------------------
CLASS A(a) CLASS B CLASS C CLASS D CLASS G
---------- ------- ------- ------- -------
Columbia Common Stock Fund .......... 0.10% 0.75% 0.75% 0.75% --
Columbia Growth Fund ................ 0.10% 0.75% 0.75% 0.75% 0.65%(b)
Columbia International Stock Fund ... -- 0.75% 0.75% 0.75% --
Columbia Mid Cap Growth Fund ........ 0.10% 0.75% 0.75% 0.75% 0.65%(b)
Columbia Real Estate Equity Fund .... 0.10% 0.75% 0.75% 0.75% --
Columbia Technology Fund ............ 0.10% 0.75% 0.75% 0.75% --
Columbia Strategic Investor Fund .... -- 0.75% 0.75% 0.75% --
Columbia Balanced Fund .............. 0.10% 0.75% 0.75% 0.75% --
Columbia Short Term Bond Fund ....... 0.10% 0.75% 0.75% 0.75% 0.65%(c)
Columbia Fixed Income Securities Fund 0.10% 0.75% 0.75% 0.75% --
Columbia National Municipal Bond Fund 0.10% 0.75% 0.75% 0.75% --
Columbia Oregon Municipal Bond Fund . 0.10% 0.75% 0.75% 0.75% --
Columbia High Yield Fund ............ 0.10% 0.75% 0.75% 0.75% --
SERVICE FEE
---------------------------------------------------
CLASS A(a) CLASS B CLASS C CLASS D CLASS G
---------- ------- ------- ------- -------
Columbia Common Stock Fund........... 0.25% 0.25% 0.25% 0.25% --
Columbia Growth Fund................. 0.25% 0.25% 0.25% 0.25% 0.50%(b)
Columbia International Stock Fund.... 0.25% 0.25% 0.25% 0.25% --
Columbia Mid Cap Growth Fund......... 0.25% 0.25% 0.25% 0.25% 0.50%(b)
Columbia Real Estate Equity Fund..... 0.25% 0.25% 0.25% 0.25% --
Columbia Technology Fund............. 0.25% 0.25% 0.25% 0.25% --
Columbia Strategic Investor Fund..... 0.25% 0.25% 0.25% 0.25% --
Columbia Balanced Fund............... 0.25% 0.25% 0.25% 0.25% --
Columbia Short Term Bond Fund........ 0.25% 0.25% 0.25% 0.25% 0.50%(c)
Columbia Fixed Income Securities Fund 0.25% 0.25% 0.25% 0.25% --
Columbia National Municipal Bond Fund 0.25% 0.25% 0.25% 0.25% --
Columbia Oregon Municipal Bond Fund.. 0.25% 0.25% 0.25% 0.25% --
Columbia High Yield Fund............. 0.25% 0.25% 0.25% 0.25% --
(a) The Fund's Board of Directors currently limits payments under the Plan for
Class A shares to 0.25% annually of the Class A average daily net assets.
(b) The Distributor has contractually agreed to limit a portion of the Class G
distribution and service fees so that combined the fee does exceed 0.95%
annually of the Class G shares average daily net assets. Of the 0.50%
service fee, 0.25% relates to shareholder liaison fees and 0.25% relates
to administration support fees.
(c) The Distributor has contractually agreed to limit a portion of the Class G
distribution and service fees so that combined the fee does exceed 0.80%
annually of the Class G shares average daily net assets. Of the 0.50%
service fee, 0.25% relates to shareholder liaison fees and 0.25% relates
to administration support fees.
162
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA FUNDS
The Distributor has voluntarily agreed to waive a portion of the Class C and
Class D distribution and service fees so that combined these fees do not exceed
the annual rates on the average daily net assets of Class C and Class D shares
of each Fund as follows:
Columbia Short Term Bond Fund........................... 0.40%
Columbia Fixed Income Securities Fund................... 0.85%
Columbia National Municipal Bond Fund................... 0.65%
Columbia Oregon Municipal Bond Fund..................... 0.65%
Columbia High Yield Fund................................ 0.85%
The CDSC and the fees received from the Plan are used principally as repayment
to the Distributor for amounts paid by the Distributor to dealers who sold such
shares.
Effective October 13, 2003, Liberty Funds Distributor, Inc. was renamed Columbia
Funds Distributor, Inc.
SHAREHOLDER SERVICES FEES
The Columbia Mid Cap Growth Fund and Columbia Short Term Bond Fund have adopted
shareholder services plans that permit them to pay for certain services provided
to Class T shareholders by their financial advisors. The annual service fee may
equal up to 0.50% annually for Class T shares, but will not exceed each Fund's
net investment income attributable to Class T shares. The Columbia Mid Cap
Growth Fund and Columbia Short Term Bond Fund do not intend to pay more than
0.30% and 0.15%, respectively, for annual Class T shareholder services fees.
EXPENSE LIMITS AND FEE REIMBURSEMENTS
Columbia has agreed to waive advisory fees and reimburse certain expenses to the
extent that total expenses (exclusive of distribution and service fees,
brokerage commissions, interest, taxes and extraordinary expenses, if any)
exceed 1.65% and 0.65% annually of the average daily net assets for the Columbia
Technology Fund and Columbia National Municipal Bond Fund, respectively. These
arrangements may be revised or discontinued at any time.
Effective June 1, 2004, Columbia has voluntarily agreed to reimburse certain
expenses of the Columbia Short Term Bond Fund to the extent that total expenses
(exclusive of distribution and service fees, brokerage commissions, interest,
taxes and extraordinary expenses, if any) exceed 0.66% annually of the Fund's
average daily net assets. For the period November 1, 2003 through May 31, 2004,
Columbia had contractually agreed to maintain this waiver. Prior to November 1,
2003, Columbia voluntarily reimbursed the Columbia Short Term Bond Fund at the
annual rate of 0.75% of the Fund's average daily net assets. In addition, prior
to November 1, 2003, Columbia or its affiliates reimbursed class specific
transfer agency fees for the Columbia Short Term Bond Fund to the extent
necessary to prevent total annual operating expenses from exceeding 1.64% and
0.98% for Class G and Class T, respectively.
CUSTODY CREDITS
Each Fund has an agreement with its custodian bank under which custody fees may
be reduced by balance credits. The Funds could have invested a portion of the
assets utilized in connection with the expense offset arrangement in an
income-producing asset if they had not entered into such an agreement.
FEES PAID TO OFFICERS AND DIRECTORS
The Funds pay no compensation to their officers, all of whom are employees of
Columbia or its affiliates.
The Funds' Directors may participate in a deferred compensation plan which may
be terminated at any time. Obligations of the plan will be paid solely out of
the Funds' assets.
OTHER
Columbia provides certain services to the Funds related to Sarbanes-Oxley
compliance. This amount is included in "Other expenses" on the Statements of
Operations. For the year ended August 31, 2004, the Funds paid fees to Columbia
for such services as follows:
Columbia Common Stock Fund.............................. $ 1,986
Columbia Growth Fund.................................... 2,770
Columbia International Stock Fund....................... 1,769
Columbia Mid Cap Growth Fund............................ 2,942
Columbia Small Cap Growth Fund.......................... 2,315
Columbia Real Estate Equity Fund........................ 2,749
Columbia Technology Fund................................ 1,323
Columbia Strategic Investor Fund........................ 1,756
Columbia Balanced Fund.................................. 2,324
Columbia Short Term Bond Fund........................... 2,154
Columbia Fixed Income Securities Fund................... 2,106
Columbia National Municipal Bond Fund................... 1,311
Columbia Oregon Municipal Bond Fund..................... 2,061
Columbia High Yield Fund................................ 3,849
Columbia Daily Income Company........................... 2,697
163
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AUGUST 31, 2004 COLUMBIA FUNDS
NOTE 5. PORTFOLIO INFORMATION
For the year ended August 31, 2004, the cost of purchases and proceeds from
sales of securities, excluding short-term obligations, were as follows:
U.S. GOVERNMENT OTHER INVESTMENT
SECURITIES SECURITIES
-------------------------------- -----------------------------------
PURCHASES SALES PURCHASES SALES
-------------- -------------- ---------------- ----------------
Columbia Common Stock Fund.................... $ -- $ -- $ 748,533,904 $ 898,454,700
Columbia Growth Fund.......................... -- -- 1,189,053,121 1,328,104,478
Columbia International Stock Fund............. -- -- 682,858,544 421,496,359
Columbia Mid Cap Growth Fund.................. -- -- 1,362,173,016 1,491,785,047
Columbia Small Cap Growth Fund................ -- -- 796,010,547 862,605,809
Columbia Real Estate Equity Fund.............. -- -- 261,518,688 408,631,429
Columbia Technology Fund...................... -- -- 178,041,291 164,791,129
Columbia Strategic Investor Fund.............. -- -- 327,456,872 289,600,245
Columbia Balanced Fund........................ 139,140,733 135,787,335 782,126,138 958,240,858
Columbia Short Term Bond Fund................. 194,582,088 184,325,701 205,085,120 195,350,487
Columbia Fixed Income Securities Fund......... 394,776,942 489,404,884 108,404,310 181,617,760
Columbia National Municipal Bond Fund......... -- -- 3,185,003 5,552,962
Columbia Oregon Municipal Bond Fund........... -- -- 50,097,232 115,372,612
Columbia High Yield Fund...................... -- -- 793,230,400 654,592,723
NOTE 6. OTHER RELATED PARTY TRANSACTIONS
During the year ended August 31, 2004, the Columbia Strategic Investor Fund used
Fleet Institutional Services ("FIS"), a wholly owned subsidiary of BOA, as a
broker. Total commissions paid to FIS during the year were $500.
NOTE 7. REDEMPTION FEES
The Columbia International Stock Fund imposes a 2.00% redemption fee to
shareholders of Class Z shares who redeem shares held for 60 days or less.
Redemption fees, which are retained by the Fund, are accounted for as an
addition to paid-in capital and are allocated to each class proportionately for
purposes of determining the net asset value of each class. Prior to October 9,
2003, redemption fees were recorded as a component of paid-in capital on Class Z
shares. For the year ended August 31, 2004, the redemption fees for the Class Z
shares of the Fund amounted to $68,059.
NOTE 8. LINE OF CREDIT
Effective July 23, 2004, the Funds and other affiliated funds began
participating in a $350,000,000 credit facility, which is used for temporary or
emergency purposes to facilitate portfolio liquidity. Interest is charged to
each Fund based on its borrowings. In addition, each Fund has agreed to pay
commitment fees on its pro-rata portion of the unutilized line of credit. The
commitment fee is included in "Other expenses" on the Statements of Operations.
Prior to July 23, 2004, the Funds participated in a $100,000,000 uncommitted
line of credit along with the CMG Fund Trust, an affiliated group of funds
managed by the investment advisor. The uncommitted line of credit, which was
scheduled to expire on July 2, 2004, was extended by the Trust and expired on
July 23, 2004.
For the year ended August 31, 2004, the average daily loan balance outstanding
on days where borrowings existed for the Columbia Common Stock Fund was
$17,313,000 at a weighted average interest rate of 1.50%. For the year ended
August 31, 2004, the Funds, other than the Columbia Common Stock Fund, did not
borrow under these arrangements.
164
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AUGUST 31, 2004 COLUMBIA FUNDS
NOTE 9. OTHER
During the year ended August 31, 2004, the Columbia Growth Fund purchased shares
of News Corp., Ltd., ADR in error. This position was subsequently sold at a loss
of $2,743 and the Fund was reimbursed by Columbia.
During the year ended August 31, 2004, the Columbia International Stock Fund
purchased shares of Compass Group PLC and foreign currency in error. These
positions were subsequently sold at a loss of $763,204 and the Fund was
reimbursed by Columbia.
NOTE 10. SHARES OF BENEFICIAL INTEREST
As of August 31, 2004, the Funds had shareholders that held greater than 5% of
the shares outstanding. Subscription and redemption activity of these
shareholders may have a material effect on the Funds. The numbers of
shareholders greater than 5% and the aggregate percentage of shares outstanding
held were as follows:
% OF SHARES
NUMBER OF OUTSTANDING
SHAREHOLDERS HELD
------------ -----------
Columbia Growth Fund........................ 1 10%
Columbia International Stock Fund........... 2 62%
Columbia Mid Cap Growth Fund................ 1 11%
Columbia Real Estate Equity Fund............ 2 22%
Columbia Short Term Bond Fund............... 3 60%
Columbia National
Municipal Bond Fund....................... 1 15%
Columbia High Yeild Fund.................... 2 31%
NOTE 11. DISCLOSURE OF SIGNIFICANT
RISKS AND CONTINGENCIES
FOREIGN SECURITIES
There are certain additional risks involved when investing in foreign securities
that are not inherent with investments in domestic securities. These risks may
involve foreign currency exchange rate fluctuations, adverse political and
economic developments and the possible prevention of currency exchange or other
foreign governmental laws or restrictions. In addition, the liquidity of foreign
securities may be more limited than that of domestic securities.
Investments in emerging market countries are subject to additional risk. The
risk of foreign investments is typically increased in less developed countries.
These countries are also more likely to experience high levels of inflation,
deflation or currency devaluation which could hurt their economies and
securities markets.
GEOGRAPHIC CONCENTRATION
The Columbia National Municipal Bond Fund has greater than 5% of its total
investments at August 31, 2004 invested in debt obligations issued by the states
of Illinois, Oregon and Washington. Also on this date, the Columbia Oregon
Municipal Bond Fund has greater than 5% of its total investments invested in
debt obligations issued by the state of Oregon. The Funds are also invested in
each state's respective political subdivisions, agencies and public authorities
to obtain funds for various purposes. These Funds are more susceptible to
economic and political factors adversely affecting issuers of each respective
specific state's municipal securities than are municipal bond funds that are not
concentrated to the same extent in these issuers.
HIGH-YIELD SECURITIES
Investing in high-yield securities may involve greater credit risk and
considerations not typically associated with investing in U.S. Government bonds
and other higher quality fixed income securities. These securities are
non-investment grade securities, often referred to as "junk bonds." Economic
downturns may disrupt the high yield market and impair the ability of issuers to
repay principal and interest. Also, an increase in interest rates would likely
have an adverse impact on the value of such obligations. Moreover, high-yield
securities may be less liquid due to the extent that there is no established
retail secondary market and because of a decline in the value of such
securities.
INDUSTRY FOCUS
The Funds may focus their investments in certain industries, subjecting them to
greater risk than a fund that is more diversified.
ISSUER FOCUS
As non-diversified funds, the Columbia Real Estate Equity Fund, the Columbia
Technology Fund and the Columbia Oregon Municipal Bond Fund may invest a greater
percentage of its total assets in the securities of fewer issuers than a
diversified fund. The Funds may, therefore, have a greater risk of loss from a
few issuers than a similar fund that invests more broadly.
165
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AUGUST 31, 2004 COLUMBIA FUNDS
LEGAL PROCEEDINGS
Columbia, the Distributor, and certain of their affiliates (collectively, "The
Columbia Group") have received information requests and subpoenas from various
regulatory and law enforcement authorities in connection with their
investigations of late trading and market timing in mutual funds as well as
other industry wide issues. The Columbia Group has not uncovered any instances
where Columbia or the Distributor were knowingly involved in late trading of
mutual fund shares.
On February 24, 2004, the Securities and Exchange Commission ("SEC") filed a
civil complaint in the United States District Court for the District of
Massachusetts against Columbia and the Distributor, 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 New York
Attorney General ("NYAG") filed a civil complaint in New York Supreme Court,
County of New York against Columbia and the Distributor alleging that Columbia
and the Distributor had violated certain New York antifraud statutes. If either
Columbia or the Distributor is unsuccessful in its defense of these proceedings,
it could be barred from serving as an investment advisor or distributor for any
investment company registered under the Investment Company Act of 1940, as
amended (a "registered investment company"). Such results could prevent
Columbia, the Distributor or any company that is an affiliated person of
Columbia and the Distributor from serving as an investment advisor or
distributor for any registered investment company, including your fund. Your
fund has been informed by Columbia and the Distributor that, if these results
occur, they will seek exemptive relief from the SEC to permit them to continue
to serve as your fund's investment advisor and distributor. There is no
assurance that such exemptive relief will be granted. On March 15, 2004,
Columbia and the Distributor entered into agreements in principle with the SEC
Division of Enforcement and NYAG in settlement of the charges. Under the
agreements, Columbia and the Distributor agreed, among other things, to the
following conditions: payment of $70 million in disgorgement; payment of $70
million in civil penalties; an order requiring Columbia and the Distributor 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 their fiduciary duties; and retention of an
independent consultant to review Columbia's and the Distributor's compliance
policies and procedures. The agreement requires the final approval of the SEC.
In a separate agreement with the NYAG, the Columbia Group and its affiliate Banc
of America Capital Management, LLC have agreed to collectively reduce mutual
fund fees by $160 million over a five-year period.
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 FleetBoston (and
affiliated entities). More than 300 cases (including those filed against
entities unaffiliated with the funds, their Boards and/or FleetBoston and its
affiliated entities) have been consolidated in a multi-district proceeding and
transferred to the Federal District Court in Maryland. Recently, certain
Columbia funds and affiliated entities have been named as defendants in several
derivative actions under various sections of the Investment Company Act of 1940,
as amended, alleging, among other things, that the fees and expenses paid by
those funds are excessive. The funds and the other defendants to these actions,
including Columbia and various affiliates, certain other mutual funds advised by
Columbia and its affiliates, and various directors of such funds, have denied
these allegations and are contesting the plaintiffs' claims. These suits and
certain regulatory investigations are ongoing, however, based on currently
available information, Columbia believes that these lawsuits are without merit,
that the likelihood they will have a material adverse impact on any fund is
remote, and that the lawsuits are not likely to materially affect its ability to
provide investment management services to its clients, including the funds.
166
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AUGUST 31, 2004 COLUMBIA FUNDS
For the year ended August 31, 2004, Columbia has assumed legal, consulting
services and Trustees' fees incurred by the Funds in connection with these
matters as follows:
Columbia Common Stock Fund............................. $ 17,852
Columbia Growth Fund................................... 42,776
Columbia International Stock Fund...................... 27,108
Columbia Mid Cap Growth Fund........................... 46,903
Columbia Small Cap Growth Fund......................... 33,352
Columbia Real Estate Equity Fund....................... 43,675
Columbia Technology Fund............................... 1,891
Columbia Strategic Investor Fund....................... 17,368
Columbia Balanced Fund................................. 27,135
Columbia Short Term Bond Fund.......................... 25,190
Columbia Fixed Income Securities Fund.................. 17,352
Columbia National Municipal Bond Fund.................. 700
Columbia Oregon Municipal Bond Fund.................... 21,237
Columbia High Yield Fund............................... 81,196
NOTE 12. BUSINESS COMBINATIONS AND MERGERS
FUND MERGERS
As of the end of business on December 6, 2002, the Galaxy Large Cap Growth Fund
merged into the Columbia Growth Fund as follows:
NET ASSETS
OF THE GALAXY
LARGE CAP
SHARES GROWTH FUND UNREALIZED
ISSUED RECEIVED DEPRECIATION 1
-------------- -------------- ---------------
4,943,168 $ 108,315,198 $ (8,049,749)
NET ASSETS NET ASSETS
NET ASSETS OF THE GALAXY OF THE
OF THE LARGE CAP COLUMBIA
COLUMBIA GROWTH FUND GROWTH FUND
GROWTH FUND IMMEDIATELY IMMEDIATELY
PRIOR TO PRIOR TO AFTER
COMBINATION COMBINATION COMBINATION
-------------- -------------- ---------------
$ 798,985,765 $ 108,315,198 $ 907,300,963
As of the end of business on November 1, 2002, the Stein Roe International Fund
("SRIF") and Liberty Newport International Equity Fund ("LNIEF") merged into the
Columbia International Stock Fund as follows:
NET ASSETS
OF SRIF
SHARES AND LNIEF UNREALIZED
ISSUED RECEIVED DEPRECIATION 1
-------------- -------------- --------------
SRIF 1,426,029 $ 14,246,030 $ (214,705)
LNIF 3,200,017 31,968,17 (948,177)
NET ASSETS
NET ASSETS OF THE
OF THE NET ASSETS COLUMBIA
COLUMBIA OF SRIF INTERNATIONAL
INTERNATIONAL AND LNIEF STOCK FUND
STOCK FUND IMMEDIATELY IMMEDIATELY
PRIOR TO PRIOR TO AFTER
COMBINATION COMBINATION COMBINATION
-------------- -------------- ---------------
$ 125,693,014 $ 46,214,202 $ 171,907,216
As of the end of business on November 1, 2002, the Liberty Midcap Growth Fund
("LMCGF"), Galaxy Growth II Fund ("GGIIF") and Stein Roe Capital Opportunities
Fund ("SRCOF") merged into the Columbia Mid Cap Growth Fund as follows:
NET ASSETS
OF LMCGF,
GGIIF
SHARES AND SRCOF UNREALIZED
ISSUED RECEIVED APPRECIATION 1
-------------- -------------- ---------------
LMCGF 1,926,436 $ 29,609,516 $ 1,312,196
GGIIF 3,693,522 56,786,294 419,666
SRCOF 13,391,313 205,776,298 4,912,798
NET ASSETS
NET ASSETS NET ASSETS OF THE
OF THE OF LMCGF, COLUMBIA
COLUMBIA GGIIF MID CAP
MID CAP AND SRCOF GROWTH FUND
GROWTH FUND IMMEDIATELY IMMEDIATELY
PRIOR TO PRIOR TO AFTER
COMBINATION COMBINATION COMBINATION
-------------- -------------- ---------------
$ 588,307,694 $ 292,172,108 $ 880,479,802
167
________________________________________________________________________________
AUGUST 31, 2004 COLUMBIA FUNDS
As of the end of business on November 1, 2002, the Liberty Contrarian Fund
("LCF") and Liberty Contrarian Equity Fund ("LCEF") merged into the Columbia
Strategic Investor Fund as follows:
NET ASSETS
OF LCF
SHARES AND LCEF UNREALIZED
ISSUED RECEIVED DEPRECIATION 1
-------------- -------------- ---------------
LCF 249,129 $ 3,236,185 $ (374,279)
LCEF 4,319,838 56,114,694 (7,312,321)
NET ASSETS
NET ASSETS OF THE
OF THE NET ASSETS COLUMBIA
COLUMBIA OF LCF STRATEGIC
STRATEGIC AND LCEF INVESTOR FUND
INVESTOR FUND IMMEDIATELY IMMEDIATELY
PRIOR TO PRIOR TO AFTER
COMBINATION COMBINATION COMBINATION
-------------- -------------- ---------------
$ 216,528,060 $ 59,350,879 $ 275,878,939
As of the end of business on December 6, 2002, the Galaxy Short Term Bond Fund
merged into the Columbia Short Term Bond Fund as follows:
NET ASSETS
OF THE GALAXY
SHORT TERM
SHARES BOND FUND UNREALIZED
ISSUED RECEIVED APPRECIATION 1
-------------- -------------- ---------------
25,924,097 $ 223,465,181 $ 3,331,362
NET ASSETS
NET ASSETS NET ASSETS OF THE
OF THE OF THE GALAXY COLUMBIA
COLUMBIA SHORT TERM SHORT TERM
SHORT TERM BOND FUND BOND FUND
BOND FUND IMMEDIATELY IMMEDIATELY
PRIOR TO PRIOR TO AFTER
COMBINATION COMBINATION COMBINATION
-------------- -------------- ---------------
$ 125,747,136 $ 223,465,181 $ 349,212,317
1 Unrealized appreciation/depreciation is included in the respective Net Assets
Received amounts shown above.
NOTE 13. COMPARABILITY OF FINANCIAL STATEMENTS
The fiscal year end of the Funds was changed from December 31 to August 31.
NOTE 14. PROPOSED REORGANIZATION
On October 13, 2004, the Board of Directors approved a proposal to reorganize
the Columbia Common Stock Fund and the Columbia Growth Fund, subject to
shareholder approval and the satisfaction of certain other conditions.
168
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FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA COMMON STOCK FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS A SHARES 2004 2003 (a) 2002 (b)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 17.22 $ 14.91 $ 15.09
- ---------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) (c) 0.02 0.01 --(d)
Net realized and unrealized gain (loss) on investments 0.89 2.30 (0.11)
------------ ------------ ------------
Total from investment operations 0.91 2.31 (0.11)
- ---------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.03) -- (0.07)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 18.10 $ 17.22 $ 14.91
Total return (e) 5.28% 15.49%(f) (0.71)%(f)
- ---------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 1,201 $ 223 $ 32
Ratio of expenses to average net assets (g) 1.17% 1.40%(h) 1.32%(h)
Ratio of net investment income (loss) to average net assets (g) 0.13% 0.08%(h) (0.03)%(h)
Portfolio turnover rate 192% 102%(f) 107%
- ---------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class A shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Rounds to less than $0.01 per share.
(e) Total return at net asset value assuming all distributions reinvested and
no initial sales charge or contingent deferred sales charge.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS B SHARES 2004 2003 (a) 2002 (b)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 17.12 $ 14.91 $ 15.09
- ---------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (c) (0.12) (0.09) (0.01)
Net realized and unrealized gain (loss) on investments 0.88 2.30 (0.12)
------------ ------------ ------------
Total from investment operations 0.76 2.21 (0.13)
- ---------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income -- -- (0.05)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 17.88 $ 17.12 $ 14.91
Total return (d) 4.44% 14.82%(e) (0.84)%(e)
- ---------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 2,060 $ 620 $ 109
Ratio of expenses to average net assets (f) 1.92% 2.36%(g) 2.07%(g)
Ratio of net investment loss to average net assets (f) (0.67)% (0.90)%(g) (0.78)%(g)
Portfolio turnover rate 192% 102%(e) 107%
- ---------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class B shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested and
no contingent deferred sales charge.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
170
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA COMMON STOCK FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
PERIOD ENDED
AUGUST 31,
CLASS C SHARES 2004 (a)
- ------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 17.61
- ------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (b) (0.11)
Net realized and unrealized gain on investments 0.38
------------
Total from investment operations 0.27
- ------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 17.88
Total return (c)(d) 1.53%
- ------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 26
Ratio of expenses to average net assets (e)(f) 1.95%
Ratio of net investment loss to average net assets (e)(f) (0.65)%
Portfolio turnover rate 192%
- ------------------------------------------------------------------------------
(a) Class C shares were initially offered on October 13, 2003. Per share data
and total return reflect 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 no contingent deferred sales
charge.
(d) Not annualized.
(e) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(f) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS D SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 17.11 $ 14.92 $ 15.09
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (c) (0.11) (0.12) (0.01)
Net realized and unrealized gain (loss) on investments 0.88 2.31 (0.11)
------------ ------------ ------------
Total from investment operations 0.77 2.19 (0.12)
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income -- -- (0.05)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 17.88 $ 17.11 $ 14.92
Total return (d) 4.50% 14.68%(e) (0.77)%(e)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 129 $ 112 $ 30
Ratio of expenses to average net assets (f) 1.92% 2.61%(g) 2.07%(g)
Ratio of net investment loss to average net assets (f) (0.59)% (1.09)%(g) (0.78)%(g)
Portfolio turnover rate 192% 102%(e) 107%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class D shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested and
no contingent deferred sales charge.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
171
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA COMMON STOCK FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED
AUGUST 31, AUGUST 31,
CLASS Z SHARES 2004 2003 (a)
------------ ------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 17.26 $ 14.91
- ------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) 0.08(c) 0.06(c)
Net realized and unrealized gain (loss)
on investments 0.88 2.29
------------ ------------
Total from investment operations 0.96 2.35
- ------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.10) --
From net realized gains -- --
------------ ------------
Total distributions (0.10) --
- ------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 18.12 $ 17.26
Total return (d) 5.58% 15.76%(e)
- ------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 303,259 $ 427,669
Ratio of expenses to average net assets (f) 0.92% 0.94%(g)
Ratio of net investment income (loss) to
average net assets (f) 0.41% 0.55%(g)
Portfolio turnover rate 192% 102%(e)
- ------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
---------------------------------------------------------------------
CLASS Z SHARES 2002 (b) 2001 2000 1999
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 19.97 $ 24.34 $ 28.90 $ 24.40
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) 0.07(c) 0.07 (0.01) 0.03
Net realized and unrealized gain (loss)
on investments (5.05) (4.35) (1.54) 6.25
------------ ------------ ------------ ------------
Total from investment operations (4.98) (4.28) (1.55) 6.28
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.08) (0.07) -- (0.03)
From net realized gains -- (0.02) (3.01) (1.75)
------------ ------------ ------------ ------------
Total distributions (0.08) (0.09) (3.01) (1.78)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 14.91 $ 19.97 $ 24.34 $ 28.90
Total return (d) (24.92)% (17.60)% (5.73)% 25.76%
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 416,638 $ 681,397 $ 895,134 $ 959,910
Ratio of expenses to average net assets (f) 0.86% 0.80% 0.75% 0.77%
Ratio of net investment income (loss) to
average net assets (f) 0.43% 0.32% (0.05)% 0.09%
Portfolio turnover rate 107% 114% 104% 97%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) On November 1, 2002, the existing Fund shares were renamed Class Z shares.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
172
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA GROWTH FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS A SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 24.61 $ 20.83 $ 21.52
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (c) (0.07) (0.07) --(d)
Net realized and unrealized gain (loss) on investments 0.39 3.85 (0.69)
------------ ------------ ------------
Total from investment operations 0.32 3.78 (0.69)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 24.93 $ 24.61 $ 20.83
Total return (e) 1.30% 18.15%(f) (3.21)%(f)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 4,668 $ 4,229 $ 3,077
Ratio of expenses to average net assets (g) 1.12% 1.33%(h) 1.15%(h)
Ratio of net investment loss to average net assets (g) (0.28)% (0.44)%(h) (0.36)%(h)
Portfolio turnover rate 130% 110%(f) 165%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class A shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Rounds to less than $0.01 per share.
(e) Total return at net asset value assuming no initial sales charge or
contingent deferred sales charge.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS B SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 24.47 $ 20.82 $ 21.52
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (c) (0.27) (0.19) (0.03)
Net realized and unrealized gain (loss) on investments 0.40 3.84 (0.67)
------------ ------------ ------------
Total from investment operations 0.13 3.65 (0.70)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 24.60 $ 24.47 $ 20.82
Total return (d) 0.53% 17.53%(e) (3.25)%(e)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 2,254 $ 793 $ 114
Ratio of expenses to average net assets (f) 1.87% 2.11%(g) 1.88%(g)
Ratio of net investment loss to average net assets (f) (1.04)% (1.27)%(g) (1.09)%(g)
Portfolio turnover rate 130% 110%(e) 165%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class B shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming no contingent deferred sales
charge.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
173
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA GROWTH FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
PERIOD ENDED
AUGUST 31,
CLASS C SHARES 2004 (a)
- ------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 24.96
- ------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (b) (0.23)
Net realized and unrealized loss on investments (0.19)
------------
Total from investment operations (0.42)
- ------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 24.54
Total return (c)(d) (1.68)%
- ------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 199
Ratio of expenses to average net assets (e)(f) 1.90%
Ratio of net investment loss to average net assets (e)(f) (1.01)%
Portfolio turnover rate 130%
- ------------------------------------------------------------------------------
(a) Class C shares were initially offered on October 13, 2003. Per share data
and total return reflect 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 no contingent deferred sales
charge.
(d) Not annualized.
(e) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(f) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS D SHARES 2004 2003 (a) 2002 (b)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 24.48 $ 20.82 $ 21.52
- ---------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (c) (0.27) (0.17) (0.02)
Net realized and unrealized gain (loss) on investments 0.41 3.83 (0.68)
------------ ------------ ------------
Total from investment operations 0.14 3.66 (0.70)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 24.62 $ 24.48 $ 20.82
Total return (d) 0.57% 17.58%(e) (3.25)%(e)
- ---------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 167 $ 294 $ 103
Ratio of expenses to average net assets (f) 1.87% 2.02%(g) 1.88%(g)
Ratio of net investment loss to average net assets (f) (1.04)% (1.15)%(g) (1.09)%(g)
Portfolio turnover rate 130% 110%(e) 165%
- ---------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class D shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming no contingent deferred sales
charge.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
174
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA GROWTH FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS G SHARES 2004 2003 (a) 2002 (b)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 24.49 $ 20.83 $ 21.52
- ---------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (c) (0.25) (0.16) (0.03)
Net realized and unrealized gain (loss) on investments 0.40 3.82 (0.66)
------------ ------------ ------------
Total from investment operations 0.15 3.66 (0.69)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 24.64 $ 24.49 $ 20.83
Total return (d) 0.61% 17.57%(e) (3.21)%(e)
- ---------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 12,996 $ 14,810 $ 13,705
Ratio of expenses to average net assets (f) 1.82% 2.00%(g) 1.83%(g)
Ratio of net investment loss to average net assets (f) (0.98)% (1.10)%(g) (1.04)%(g)
Portfolio turnover rate 130% 110%(e) 165%
- ---------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class G shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming no contingent deferred sales
charge.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
YEAR ENDED PERIOD ENDED
AUGUST 31, AUGUST 31,
CLASS Z SHARES 2004 2003 (a)
- ------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 24.70 $ 20.85
- ------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) --(c)(d) --(c)(d)
Net realized and unrealized gain (loss)
on investments 0.39 3.85
------------ ------------
Total from investment operations 0.39 3.85
- ------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income -- --
From net realized gains -- --
------------ ------------
Total distributions -- --
- ------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 25.09 $ 24.70
Total return (e) 1.58% 18.47%(f)
- ------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 790,696 $ 909,611
Ratio of expenses to average net assets (g) 0.87% 0.88%(h)
Ratio of net investment income (loss) to
average net assets (g) (0.01)% 0.01%(h)
Portfolio turnover rate 130% 110%(f)
- ------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
---------------------------------------------------------------------
CLASS Z SHARES 2002 (b) 2001 2000 1999
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 31.35 $ 40.07 $ 48.91 $ 42.51
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) (0.01)(c) (0.02) (0.08) (0.03)
Net realized and unrealized gain (loss)
on investments (10.49) (8.55) (3.49) 11.09
------------ ------------ ------------ ------------
Total from investment operations (10.50) (8.57) (3.57) 11.06
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income -- -- -- --(d)
From net realized gains -- (0.15) (5.27) (4.66)
------------ ------------ ------------ ------------
Total distributions -- (0.15) (5.27) (4.66)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 20.85 $ 31.35 $ 40.07 $ 48.91
Total return (e) (33.49)% (21.40)% (7.94)% 26.02%
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 811,648 $ 1,325,844 $ 1,919,227 $ 2,160,739
Ratio of expenses to average net assets (g) 0.82% 0.72% 0.65% 0.65%
Ratio of net investment income (loss) to
average net assets (g) (0.03)% (0.07)% (0.18)% (0.07)%
Portfolio turnover rate 165% 122% 114% 118%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) On November 1, 2002, the existing Fund shares were renamed Class Z shares.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Rounds to less than $0.01 per share.
(e) Total return at net asset value assuming all distributions reinvested.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
175
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA INTERNATIONAL STOCK FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS A SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 11.34 $ 10.05 $ 10.04
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) (c) 0.01 0.04 (0.02)
Net realized and unrealized gain on investments,
foreign currency and foreign capital gains tax 1.69 1.25 0.03
------------ ------------ ------------
Total from investment operations 1.70 1.29 0.01
- --------------------------------------------------------------------------------------------------------------------
REDEMPTION FEES:
Redemption fees added to paid-in capital --(c)(d) -- --
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 13.04 $ 11.34 $ 10.05
Total return (e) 14.99%(f) 12.84%(g) 0.10%(g)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 24,119 $ 21,664 $ 20,178
Ratio of expenses to average net assets (h) 1.72% 1.90%(i) 1.86%(i)
Ratio of net investment income (loss) to average net assets (h) 0.10% 0.61%(i) (0.39)%(i)
Waiver 0.09% -- --
Portfolio turnover rate 90% 43%(g) 96%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class A shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Rounds to less than $0.01 per share.
(e) Total return at net asset value assuming no initial sales charge or
contingent deferred sales charge.
(f) Had the Investment Advisor not waived a portion of expenses, total return
would have been reduced.
(g) Not annualized.
(h) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(i) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS B SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 11.23 $ 10.02 $ 10.04
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (c) (0.09) (0.03) (0.05)
Net realized and unrealized gain on investments,
foreign currency and foreign capital gains tax 1.67 1.24 0.03
------------ ------------ ------------
Total from investment operations 1.58 1.21 (0.02)
- --------------------------------------------------------------------------------------------------------------------
REDEMPTION FEES:
Redemption fees added to paid-in capital --(c)(d) -- --
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 12.81 $ 11.23 $ 10.02
Total return (e)(f) 14.07% 12.08%(g) (0.20)%(g)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 10,221 $ 10,316 $ 10,920
Ratio of expenses to average net assets (h) 2.50% 2.98%(i) 3.64%(i)
Ratio of net investment loss to average net assets (h) (0.69)% (0.47)%(i) (2.17)%(i)
Waiver 0.18% 0.11%(i) 0.11%(i)
Portfolio turnover rate 90% 43%(g) 96%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class B shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Rounds to less than $0.01 per share.
(e) Total return at net asset value assuming no contingent deferred sales
charge.
(f) Had the Investment Advisor not waived a portion of expenses, total return
would have been reduced.
(g) Not annualized.
(h) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(i) Annualized.
176
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA INTERNATIONAL STOCK FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
PERIOD ENDED
AUGUST 31,
CLASS C SHARES 2004 (a)
- ------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 12.27
- ------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (b) (0.01)
Net realized and unrealized gain on investments, foreign
currency and foreign capital gains tax 0.60
------------
Total from investment operations 0.59
- ------------------------------------------------------------------------------
REDEMPTION FEES:
Redemption fees added to paid-in capital --(b)(c)
- ------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 12.86
Total return (d)(e)(f) 4.81%
- ------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 632
Ratio of expenses to average net assets (g)(h) 2.11%
Ratio of net investment loss to average net assets (g)(h) (0.05)%
Waiver (h) 0.35%
Portfolio turnover rate 90%
- ------------------------------------------------------------------------------
(a) Class C shares were initially offered on October 13, 2003. Per share data
and total return reflect activity from that date.
(b) Per share data was calculated using average shares outstanding during the
period.
(c) Rounds to less than $0.01 per share.
(d) Total return at net asset value assuming no contingent deferred sales
charge.
(e) Had the Investment Advisor not waived a portion of expenses, total return
would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS D SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 11.27 $ 10.02 $ 10.04
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) (c) (0.04) --(d) (0.04)
Net realized and unrealized gain on investments,
foreign currency and foreign capital gains tax 1.68 1.25 0.02
- --------------------------------------------------------------------------------------------------------------------
Total from investment operations 1.64 1.25 (0.02)
------------ ------------ ------------
REDEMPTION FEES:
Redemption fees added to paid-in capital --(c)(d) -- --
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 12.91 $ 11.27 $ 10.02
Total return (e)(f) 14.55% 12.48%(g) (0.20)%(g)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 738 $ 633 $ 542
Ratio of expenses to average net assets (h) 2.10% 2.49%(i) 3.48%(i)
Ratio of net investment income (loss) to average net assets (h) (0.27)% 0.02%(i) (2.01)%(i)
Waiver 0.57% 0.75%(i) 0.75%(i)
Portfolio turnover rate 90% 43%(g) 96%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class D shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Rounds to less than $0.01 per share.
(e) Total return at net asset value assuming no contingent deferred sales
charge.
(f) Had the Investment Advisor not waived a portion of expenses, total return
would have been reduced.
(g) Not annualized.
(h) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(i) Annualized.
177
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA INTERNATIONAL STOCK FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED
AUGUST 31, AUGUST 31,
CLASS Z SHARES 2004 2003 (a)
- ------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 11.40 $ 10.05
- ------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) 0.11(c) 0.07(c)
Net realized and unrealized gain (loss) on
investments, foreign currency and foreign
capital gains tax 1.67 1.27
------------ ------------
Total from investment operations 1.78 1.34
- ------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.04) --
From net realized gains -- --
Return of capital -- --
------------ ------------
Total distributions (0.04) --
- ------------------------------------------------------------------------------
REDEMPTION FEES:
Redemption fees added to
paid-in capital --(c)(d) 0.01(c)
- ------------------------------------------------------------------------------
Net asset value, end of period $ 13.14 $ 11.40
Total return (e) 15.65%(f) 13.43%(f)(g)
- ------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 558,082 $ 248,718
Ratio of expenses to average net assets (h) 1.10% 1.47%(i)
Ratio of net investment income (loss) to
average net assets (h) 0.81% 1.03%(i)
Waiver 0.18% 0.12%(i)
Portfolio turnover rate 90% 43%(g)
- ------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
---------------------------------------------------------------------
CLASS Z SHARES 2002 (b) 2001 2000 1999
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 12.03 $ 14.77 $ 22.81 $ 15.45
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) --(c)(d) 0.01 (0.04) (0.05)
Net realized and unrealized gain (loss) on
investments, foreign currency and foreign
capital gains tax (1.94) (2.74) (5.17) 9.00
------------ ------------ ------------ ------------
Total from investment operations (1.94) (2.73) (5.21) 8.95
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.01) (0.01) -- --
From net realized gains -- -- (2.83) (1.59)
Return of capital (0.03) -- -- --
------------ ------------ ------------ ------------
Total distributions (0.04) (0.01) (2.83) (1.59)
- --------------------------------------------------------------------------------------------------------------------
REDEMPTION FEES:
Redemption fees added to
paid-in capital -- -- -- --
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 10.05 $ 12.03 $ 14.77 $ 22.81
Total return (e) (16.10)%(f) (18.47)% (22.64)% 57.93%
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 143,332 $ 135,626 $ 175,316 $ 239,223
Ratio of expenses to average net assets (h) 1.49% 1.56% 1.42% 1.48%
Ratio of net investment income (loss) to
average net assets (h) (0.02)% 0.06% (0.19)% (0.35)%
Waiver 0.12% -- -- --
Portfolio turnover rate 96% 130% 112% 94%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) On November 1, 2002, the existing Fund shares were renamed Class Z shares.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Rounds to less than $0.01 per share.
(e) Total return at net asset value assuming all distributions reinvested.
(f) Had the Investment Advisor not waived a portion of expenses, total return
would have been reduced
(g) Not annualized.
(h) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(i) Annualized.
178
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA MID CAP GROWTH FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
Class A Shares 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 18.09 $ 14.77 $ 15.15
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (c) (0.23) (0.14) (0.02)
Net realized and unrealized gain (loss) on
investments and foreign currency (0.87) 3.46 (0.36)
------------ ------------ ------------
Total from investment operations (1.10) 3.32 (0.38)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 16.99 $ 18.09 $ 14.77
Total return (d)(e) (6.08)% 22.48%(f) (2.51)%(f)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 4,432 $ 4,525 $ 1,180
Ratio of expenses to average net assets (g) 1.53% 1.60%(h) 1.49%(h)
Ratio of net investment loss to average net assets (g) (1.21)% (1.31)%(h) (1.22)%(h)
Waiver 0.02% 0.01%(h) 0.01%(h)
Portfolio turnover rate 139% 78%(f) 88%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class A shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming no initial sales charge or
contingent deferred sales charge.
(e) Had the Investment Advisor not waived a portion of expenses, total return
would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
Class B Shares 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 17.98 $ 14.76 $ 15.15
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (c) (0.36) (0.22) (0.04)
Net realized and unrealized gain (loss) on
investments and foreign currency (0.87) 3.44 (0.35)
------------ ------------ ------------
Total from investment operations (1.23) 3.22 (0.39)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 16.75 $ 17.98 $ 14.76
Total return (d)(e) (6.84)% 21.82%(f) (2.57)%(f)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 5,079 $ 4,242 $ 3,383
Ratio of expenses to average net assets (g) 2.29% 2.36%(h) 2.32%(h)
Ratio of net investment loss to average net assets (g) (1.97)% (2.06)%(h) (2.05)%(h)
Waiver 0.10% 0.12%(h) 0.12%(h)
Portfolio turnover rate 139% 78%(f) 88%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class B shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming no contingent deferred sales
charge.
(e) Had the Investment Advisor not waived a portion of expenses, total return
would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
179
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA MID CAP GROWTH FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
PERIOD ENDED
AUGUST 31,
CLASS C SHARES 2004 (a)
- --------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 17.88
- --------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (b) (0.30)
Net realized and unrealized loss on
investments and foreign currency (0.79)
------------
Total from investment operations (1.09)
- --------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 16.79
Total return (c)(d)(e) (6.10)%
- --------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 501
Ratio of expenses to average net assets (f)(g) 2.18%
Ratio of net investment loss to average net assets (f)(g) (1.83)%
Waiver (g) 0.08%
Portfolio turnover rate 139%
- --------------------------------------------------------------------------------
(a) Class C shares were initially offered on October 13, 2003. Per share data
and total return reflect 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 no contingent deferred sales
charge.
(d) Had the Investment Advisor not waived a portion of expenses, total return
would have been reduced.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS D SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 17.98 $ 14.76 $ 15.15
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (c) (0.34) (0.21) (0.04)
Net realized and unrealized gain (loss) on
investments and foreign currency (0.87) 3.43 (0.35)
------------ ------------ ------------
Total from investment operations (1.21) 3.22 (0.39)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 16.77 $ 17.98 $ 14.76
Total return (d)(e) (6.73)% 21.82%(f) (2.57)%(f)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 599 $ 737 $ 433
Ratio of expenses to average net assets (g) 2.19% 2.27%(h) 2.32%(h)
Ratio of net investment loss to average net assets (g) (1.87)% (1.97)%(h) (2.05)%(h)
Waiver 0.08% 0.09%(h) 0.09%(h)
Portfolio turnover rate 139% 78%(f) 88%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class D shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming no contingent deferred sales
charge.
(e) Had the Investment Advisor not waived a portion of expenses, total return
would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
180
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA MID CAP GROWTH FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS G SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 17.98 $ 14.77 $ 15.15
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (c) (0.41) (0.23) (0.04)
Net realized and unrealized gain (loss) on
investments and foreign currency (0.87) 3.44 (0.34)
------------ ------------ ------------
Total from investment operations (1.28) 3.21 (0.38)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 16.70 $ 17.98 $ 14.77
Total return (d) (7.12)%(e) 21.73%(f) (2.51)%(f)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 647 $ 806 $ 753
Ratio of expenses to average net assets (g) 2.57% 2.47%(h) 2.35%(h)
Ratio of net investment loss to average net assets (g) (2.25)% (2.17)%(h) (2.08)%(h)
Waiver 0.01% -- --
Portfolio turnover rate 139% 78%(f) 88%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class G shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming no contingent deferred sales
charge.
(e) Had the Investment Advisor not waived a portion of expenses, total return
would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS T SHARES 2004 2003 (a) 2002 (b)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 18.12 $ 14.79 $ 15.15
- ---------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (c) (0.22) (0.12) (0.02)
Net realized and unrealized gain (loss) on
investments and foreign currency (0.87) 3.45 (0.34)
------------ ------------ ------------
Total from investment operations (1.09) 3.33 (0.36)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 17.03 $ 18.12 $ 14.79
Total return (d) (6.02)%(e) 22.52%(f) (2.38)%(f)
- ---------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 25,236 $ 29,920 $ 25,966
Ratio of expenses to average net assets (g) 1.50% 1.46%(h) 1.45%(h)
Ratio of net investment loss to average net assets (g) (1.19)% (1.16)%(h) (1.18)%(h)
Waiver 0.01% -- --
Portfolio turnover rate 139% 78%(f) 88%
- ---------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class T shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming no initial sales charge or
contingent deferred sales charge.
(e) Had the Investment Advisor not waived a portion of expenses, total return
would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
181
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA MID CAP GROWTH FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED
AUGUST 31, AUGUST 31,
CLASS Z SHARES 2004 2003 (a)
- --------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 18.17 $ 14.79
- --------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (0.14)(c) (0.08)(c)
Net realized and unrealized gain (loss)
on investments and foreign currency (0.89) 3.46
------------ ------------
Total from investment operations (1.03) 3.38
- --------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net realized gains -- --
- --------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 17.14 $ 18.17
Total return (d) (5.67)%(e) 22.85%(e)(f)
- --------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 825,988 $ 998,943
Ratio of expenses to average net assets (g) 1.07% 1.09%(h)
Ratio of net investment loss to average
net assets (g) (0.75)% (0.80)%(h)
Waiver 0.05% 0.05%(h)
Portfolio turnover rate 139% 78%(f)
- --------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
---------------------------------------------------------------------
CLASS Z SHARES 2003 (b) 2001 2000 1999
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 19.60 $ 25.99 $ 29.93 $ 23.62
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (0.13)(c) (0.11) (0.10) (0.16)
Net realized and unrealized gain (loss)
on investments and foreign currency (4.68) (5.35) 4.45 8.74
------------ ------------ ------------ ------------
Total from investment operations (4.81) (5.46) 4.35 8.58
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net realized gains -- (0.93) (8.29) (2.27)
- --------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 14.79 $ 19.60 $ 25.99 $ 29.93
Total return (d) (24.54)%(e) (20.98)% 13.84% 36.33%
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 807,342 $ 786,071 $ 1,095,525 $ 918,322
Ratio of expenses to average net assets (g) 1.12% 1.08% 0.99% 1.09%
Ratio of net investment loss to average
net assets (g) (0.85)% (0.49)% (0.38)% (0.64)%
Waiver 0.05% -- -- --
Portfolio turnover rate 88% 186% 169% 135%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) On November 1, 2002, the existing Fund shares were renamed Class Z shares.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested.
(e) Had the Investment Advisor not waived a portion of expenses, total return
would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
182
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA SMALL CAP GROWTH FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED
AUGUST 31, AUGUST 31,
CLASS Z SHARES 2004 2003 (a)
- ------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 21.62 $ 16.30
- ------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (0.24)(c) (0.13)(c)
Net realized and unrealized gain (loss)
on investments (0.06) 5.45
------------ ------------
Total from investment operations (0.30) 5.32
- ------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net realized gains -- --
- ------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 21.32 $ 21.62
Total return (d) (1.39)% 32.64%(e)
- ------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 543,016 $ 637,616
Ratio of expenses to average net assets (f) 1.18% 1.28%(g)
Ratio of net investment loss to average
net assets (f) (1.01)% (1.09)%(g)
Portfolio turnover rate 118% 79%(e)
- ------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
---------------------------------------------------------------------
CLASS Z SHARES 2002 (b) 2001 2000 1999
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 22.20 $ 25.87 $ 27.26 $ 17.43
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (0.17)(c) (0.13) (0.10) (0.14)
Net realized and unrealized gain (loss)
on investments (5.73) (3.54) 1.75 10.45
------------ ------------ ------------ ------------
Total from investment operations (5.90) (3.67) 1.65 10.31
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net realized gains -- -- (3.04) (0.48)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 16.30 $ 22.20 $ 25.87 $ 27.26
Total return (d) (26.58)% (14.19)% 5.85% 59.15%
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 493,031 $ 617,966 $ 518,970 $ 290,374
Ratio of expenses to average net assets (f) 1.24% 1.23% 1.22% 1.30%
Ratio of net investment loss to average
net assets (f) (0.90)% (0.71)% (0.44)% (0.84)%
Portfolio turnover rate 109% 129% 145% 188%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) On November 1, 2002, the existing Fund shares were renamed Class Z shares.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
183
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA REAL ESTATE EQUITY FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS A SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 21.04 $ 17.80 $ 17.01
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.77 0.36(d) 0.26
Net realized and unrealized gain on investments 4.67 3.11(d) 0.78
------------ ------------ ------------
Total from investment operations 5.44 3.47 1.04
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.70) (0.23) (0.25)
From net realized gains (0.19) -- --
------------ ------------ ------------
Total distributions (0.89) (0.23) (0.25)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 25.59 $ 21.04 $ 17.80
Total return (e) 26.42% 19.62%(f) 6.10%(f)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 32,703 $ 12,364 $ 905
Ratio of expenses to average net assets (g) 1.20% 1.55%(h) 1.43%(h)
Ratio of net investment income to average net assets (g) 3.27% 2.70%(d)(h) 4.81%(h)
Portfolio turnover rate 28% 33%(f) 53%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class A shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Effective January 1, 2003, the Fund adopted the policy to reduce cost of
investments for financial statement purposes by the distributions received
in excess of income from Real Estate Investment Trusts. The effect of this
change for the eight months ended August 31, 2003 was to decrease the net
investment income per share by $0.05, increase net realized and unrealized
gain on investments per share by $0.05 and decrease the ratio of net
investment income to average net assets from 3.12% to 2.70%. Per share data
and ratios for periods prior to August 31, 2003 have not been restated to
reflect this change in policy.
(e) Total return at net asset value assuming all distributions reinvested and
no initial sales charge or contingent deferred sales charge.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
Class B Shares 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 21.03 $ 17.82 $ 17.01
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.58 0.24(d) 0.22
Net realized and unrealized gain on investments 4.70 3.12(d) 0.81
------------ ------------ ------------
Total from investment operations 5.28 3.36 1.03
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.52) (0.15) (0.22)
From net realized gains (0.19) -- --
------------ ------------ ------------
Total distributions (0.71) (0.15) (0.22)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 25.60 $ 21.03 $ 17.82
Total return (e) 25.53% 18.97%(f) 6.09%(f)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 11,234 $ 4,776 $ 1,074
Ratio of expenses to average net assets (g) 1.98% 2.37%(h) 2.18%(h)
Ratio of net investment income to average net assets (g) 2.47% 1.86%(d)(h) 4.06%(h)
Portfolio turnover rate 28% 33%(f) 53%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class B shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Effective January 1, 2003, the Fund adopted the policy to reduce cost of
investments for financial statement purposes by the distributions received
in excess of income from Real Estate Investment Trusts. The effect of this
change for the eight months ended August 31, 2003 was to decrease the net
investment income per share by $0.05, increase net realized and unrealized
gain on investments per share by $0.05 and decrease the ratio of net
investment income to average net assets from 2.28% to 1.86%. Per share data
and ratios for periods prior to August 31, 2003 have not been restated to
reflect this change in policy.
(e) Total return at net asset value assuming all distributions reinvested and
no contingent deferred sales charge.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
184
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA REAL ESTATE EQUITY FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
PERIOD ENDED
AUGUST 31,
CLASS C SHARES 2004 (a)
- ------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 21.99
- ------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (b) 0.41
Net realized and unrealized gain on investments 3.72
------------
Total from investment operations 4.13
- ------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.35)
From net realized gains (0.19)
------------
Total distributions (0.54)
- ------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 25.58
Total return (c)(d) 18.99%
- ------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 2,404
Ratio of expenses to average net assets (e)(f) 1.95%
Ratio of net investment income to average net assets (e)(f) 1.93%
Portfolio turnover rate 28%
- ------------------------------------------------------------------------------
(a) Class C shares were initially offered on October 13, 2003. Per share data
and total return reflect 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 contingent deferred sales charge.
(d) Not annualized.
(e) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(f) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS D SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 21.03 $ 17.82 $ 17.01
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.65 0.27(d) 0.21
Net realized and unrealized gain on investments 4.63 3.10(d) 0.82
------------ ------------ ------------
Total from investment operations 5.28 3.37 1.03
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.53) (0.16) (0.22)
From net realized gains (0.19) -- --
------------ ------------ ------------
Total distributions (0.72) (0.16) (0.22)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 25.59 $ 21.03 $ 17.82
Total return (e) 25.55% 18.99%(f) 6.09%(f)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 4,059 $ 3,466 $ 365
Ratio of expenses to average net assets (g) 1.96% 2.30%(h) 2.18%(h)
Ratio of net investment income to average net assets (g) 2.81% 2.02%(d)(h) 4.06%(h)
Portfolio turnover rate 28% 33%(f) 53%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class D shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Effective January 1, 2003, the Fund adopted the policy to reduce cost of
investments for financial statement purposes by the distributions received
in excess of income from Real Estate Investment Trusts. The effect of this
change for the eight months ended August 31, 2003 was to decrease the net
investment income per share by $0.05, increase net realized and unrealized
gain on investments per share by $0.05 and decrease the ratio of net
investment income to average net assets from 2.44% to 2.02%. Per share data
and ratios for periods prior to August 31, 2003 have not been restated to
reflect this change in policy.
(e) Total return at net asset value assuming all distributions reinvested and
no contingent deferred sales charge.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
185
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA REAL ESTATE EQUITY FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED
AUGUST 31, AUGUST 31,
CLASS Z SHARES 2004 2003 (a)
- ------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 21.06 $ 17.81
- ------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.88(c) 0.39(c)(d)
Net realized and unrealized gain (loss)
on investments 4.62 3.14(d)
------------ ------------
Total from investment operations 5.50 3.53
- ------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.77) (0.28)
From net realized gains (0.19) --
------------ ------------
Total distributions (0.96) (0.28)
- ------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 25.60 $ 21.06
Total return (e) 26.72% 20.01%(f)
- ------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 872,924 $ 884,747
Ratio of expenses to average net assets (g) 0.97% 1.08%(h)
Ratio of net investment income to
average net assets (g) 3.78% 3.09%(d)(h)
Portfolio turnover rate 28% 33%(f)
- ------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
---------------------------------------------------------------------
CLASS Z SHARES 2002 (b) 2001 2000 1999
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 18.04 $ 17.89 $ 14.57 $ 15.76
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.82(c) 0.79 0.81 0.82
Net realized and unrealized gain (loss)
on investments (0.25) 0.15 3.32 (1.19)
------------ ------------ ------------ ------------
Total from investment operations 0.57 0.94 4.13 (0.37)
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.71) (0.72) (0.75) (0.71)
From net realized gains (0.09) (0.07) (0.06) (0.11)
------------ ------------ ------------ ------------
Total distributions (0.80) (0.79) (0.81) (0.82)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 17.81 $ 18.04 $ 17.89 $ 14.57
Total return (e) 3.12% 5.41% 28.84% (2.45)%
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 774,646 $ 621,590 $ 436,764 $ 241,716
Ratio of expenses to average net assets (g) 0.94% 0.95% 0.96% 0.99%
Ratio of net investment income to
average net assets (g) 5.30% 4.65% 5.16% 5.66%
Portfolio turnover rate 53% 41% 25% 29%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) On November 1, 2002, the existing Fund shares were renamed Class Z shares.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Effective January 1, 2003, the Fund adopted the policy to reduce cost of
investments for financial statement purposes by the distributions received
in excess of income from Real Estate Investment Trusts. The effect of this
change for the eight months ended August 31, 2003 was to decrease the net
investment income per share by $0.05, increase net realized and unrealized
gain on investments per share by $0.05 and decrease the ratio of net
investment income to average net assets from 3.51% to 3.09%. Per share data
and ratios for periods prior to August 31, 2003 have not been restated to
reflect this change in policy.
(e) Total return at net asset value assuming all distributions reinvested.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
186
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA TECHNOLOGY FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS A SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 5.91 $ 3.79 $ 3.82
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (c) (0.11) (0.04) (0.01)
Net realized and unrealized gain (loss) on
investments and foreign currency 0.70 2.16 (0.02)
------------ ------------ ------------
Total from investment operations 0.59 2.12 (0.03)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 6.50 $ 5.91 $ 3.79
Total return (d)(e) 9.98% 55.94%(f) (0.79)%(f)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 2,818 $ 376 $ 1
Ratio of expenses to average net assets (g) 1.90% 1.90%(h) 1.76%(h)
Ratio of net investment loss to average net assets (g) (1.51)% (1.35)%(h) (1.35)%(h)
Reimbursement 0.53% 3.06%(h) 1.24%(h)
Portfolio turnover rate 488% 523%(f) 512%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class A shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming no initial sales charge or
contingent deferred sales charge.
(e) Had the Investment Advisor not reimbursed a portion of expenses, total
return would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS B SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 5.86 $ 3.78 $ 3.82
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (c) (0.16) (0.07) (0.01)
Net realized and unrealized gain (loss) on
investments and foreign currency 0.70 2.15 (0.03)
------------ ------------ ------------
Total from investment operations 0.54 2.08 (0.04)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 6.40 $ 5.86 $ 3.78
Total return (d)(e) 9.22% 55.03%(f) (1.05)%(f)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 2,200 $ 1,246 $ 7
Ratio of expenses to average net assets (g) 2.65% 2.65%(h) 2.51%(h)
Ratio of net investment loss to average net assets (g) (2.30)% (2.11)%(h) (2.10)%(h)
Reimbursement 0.48% 2.40%(h) 1.24%(h)
Portfolio turnover rate 488% 523%(f) 512%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class B shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming no contingent deferred sales
charge.
(e) Had the Investment Advisor not reimbursed a portion of expenses, total
return would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
187
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA TECHNOLOGY FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
PERIOD ENDED
AUGUST 31,
CLASS C SHARES 2004 (a)
- -------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 6.48
- -------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (b) (0.14)
Net realized and unrealized gain on
investments and foreign currency 0.07
------------
Total from investment operations (0.07)
- -------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 6.41
Total return (c)(d)(e) (1.08)%
- -------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 488
Ratio of expenses to average net assets (f)(g) 2.65%
Ratio of net investment loss to average net assets (f)(g) (2.18)%
Reimbursement (g) 0.68%
Portfolio turnover rate 488%
- -------------------------------------------------------------------------------
(a) Class C shares were initially offered on October 13, 2003. Per share data
and total return reflect 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 no contingent deferred sales
charge.
(d) Had the Investment Advisor not reimbursed a portion of expenses, total
return would have been reduced.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS D SHARES 2004 2003 (a) 2002 (b)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 5.88 $ 3.78 $ 3.82
- ---------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (c) (0.16) (0.07) (0.01)
Net realized and unrealized gain (loss) on
investments and foreign currency 0.71 2.17 (0.03)
------------ ------------ ------------
Total from investment operations 0.55 2.10 (0.04)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 6.43 $ 5.88 $ 3.78
Total return (d)(e) 9.35% 55.56%(f) (1.05)%(f)
- ---------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 21 $ 15 $ 1
Ratio of expenses to average net assets (g) 2.65% 2.65%(h) 2.51%(h)
Ratio of net investment loss to average net assets (g) (2.31)% (2.13)%(h) (2.10)%(h)
Reimbursement 0.77% 4.00%(h) 1.24%(h)
Portfolio turnover rate 488% 523%(f) 512%
- ---------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class D shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming no contingent deferred sales
charge.
(e) Had the Investment Advisor not reimbursed a portion of expenses, total
return would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
188
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA TECHNOLOGY FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED
AUGUST 31, AUGUST 31,
CLASS Z SHARES 2004 2003 (a)
- --------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 5.93 $ 3.79
- --------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) (0.09)(d) (0.04)(d)
Net realized and unrealized gain (loss) on investments
and foreign currency 0.71 2.18
------------ ------------
Total from investment operations 0.62 2.14
- --------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income -- --
- --------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 6.55 $ 5.93
Total return (e)(f) 10.46% 56.46%(g)
- --------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 30,268 $ 19,663
Ratio of expenses to average net assets (h) 1.65% 1.65%(i)
Ratio of net investment income (loss) to average net assets(h) (1.30)% (1.19)%(i)
Reimbursement 0.53% 2.73%(i)
Portfolio turnover rate 488% 523%(g)
- --------------------------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31, PERIOD ENDED
------------------------------- DECEMBER 31,
CLASS Z SHARES 2002 (b) 2001 2000 (c)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 6.13 $ 8.63 $ 10.00
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) (0.06)(d) (0.08) 0.01
Net realized and unrealized gain (loss) on investments
and foreign currency (2.28) (2.42) (1.37)
------------ ------------ ------------
Total from investment operations (2.34) (2.50) (1.36)
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income -- -- (0.01)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 3.79 $ 6.13 $ 8.63
Total return (e)(f) (38.17)% (28.97)% (13.78)%(g)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 8,055 $ 10,385 $ 4,327
Ratio of expenses to average net assets (h) 1.65% 1.69% 1.48%(i)
Ratio of net investment income (loss) to average net assets(h) (1.24)% (1.26)% 0.99%(i)
Reimbursement 1.33% 1.13% 7.49%(i)
Portfolio turnover rate 512% 413% 63%(g)
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) On November 1, 2002, the existing Fund shares were renamed Class Z shares.
(c) The Fund commenced investment operations on October 27, 2000. Per share
data, total return and portfolio turnover rate reflect activity from that
date.
(d) Per share data was calculated using average shares outstanding during the
period.
(e) Total return at net asset value assuming all distributions reinvested.
(f) Had the Investment Advisor not reimbursed a portion of expenses, total
return would have been reduced.
(g) Not annualized.
(h) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(i) Annualized.
189
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA STRATEGIC INVESTOR FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS A SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 15.95 $ 13.13 $ 12.72
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.03 0.06 0.01
Net realized and unrealized gain on
investments and foreign currency 2.46 2.76 0.40
------------ ------------ ------------
Total from investment operations 2.49 2.82 0.41
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.07) -- --
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 18.37 $ 15.95 $ 13.13
Total return (d) 15.64%(e) 21.48%(f) 3.22%(f)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 99,608 $ 60,112 $ 53,526
Ratio of expenses to average net assets (g) 1.27% 1.30%(h) 1.21%(h)
Ratio of net investment income to average net assets (g) 0.19% 0.60%(h) 0.64%(h)
Waiver 0.01% -- --
Portfolio turnover rate 106% 68%(f) 188%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class A shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested and
no initial sales charge or contingent deferred sales charge.
(e) Had the Investment Advisor not waived a portion of expenses, total return
would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS B SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 15.82 $ 13.10 $ 12.72
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (c) (0.10) (0.03) (0.01)
Net realized and unrealized gain on
investments and foreign currency 2.45 2.75 0.39
------------ ------------ ------------
Total from investment operations 2.35 2.72 0.38
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 18.17 $ 15.82 $ 13.10
Total return (d)(e) 14.85% 20.76%(f) 2.99%(f)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 22,071 $ 3,398 $ 2,350
Ratio of expenses to average net assets (g) 2.02% 2.22%(h) 2.36%(h)
Ratio of net investment loss to average net assets (g) (0.57)% (0.33)%(h) (0.51)%(h)
Waiver 0.14% 0.23%(h) 0.23%(h)
Portfolio turnover rate 106% 68%(f) 188%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class B shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming no contingent deferred sales
charge.
(e) Had the Investment Advisor not waived a portion of expenses, total return
would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
190
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA STRATEGIC INVESTOR FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
PERIOD ENDED
AUGUST 31,
CLASS C SHARES 2004 (a)
- ------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 16.42
- ------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (b) (0.09)
Net realized and unrealized gain on
investments and foreign currency 1.85
------------
Total from investment operations 1.76
- ------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 18.18
Total return (c)(d)(e) 10.72%
- ------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 14,821
Ratio of expenses to average net assets (f)(g) 2.05%
Ratio of net investment loss to average net assets (f)(g) (0.57)%
Waiver (g) 0.07%
Portfolio turnover rate 106%
- ------------------------------------------------------------------------------
(a) Class C shares were initially offered on October 13, 2003. Per share data
and total return reflect 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 no contingent deferred sales
charge.
(d) Had the Investment Advisor not waived a portion of expenses, total return
would have been reduced.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS D SHARES 2004 2003 (a) 2002 (b)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 15.81 $ 13.11 $ 12.72
- ---------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (c) (0.08) (0.05) (0.01)
Net realized and unrealized gain on
investments and foreign currency 2.44 2.75 0.40
------------ ------------ ------------
Total from investment operations 2.36 2.70 0.39
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 18.17 $ 15.81 $ 13.11
Total return (d)(e) 14.93% 20.59%(f) 3.07%(f)
- ---------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 693 $ 704 $ 355
Ratio of expenses to average net assets (g) 1.94% 2.34%(h) 2.28%(h)
Ratio of net investment loss to average net assets (g) (0.48)% (0.48)%(h) (0.43)%(h)
Waiver 0.12% 0.15%(h) 0.15%(h)
Portfolio turnover rate 106% 68%(f) 188%
- ---------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class D shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming no contingent deferred sales
charge.
(e) Had the Investment Advisor not waived a portion of expenses, total return
would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
191
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA STRATEGIC INVESTOR FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED
AUGUST 31, AUGUST 31,
CLASS Z SHARES 2004 2003 (a)
- --------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 15.98 $ 13.14
- --------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.08(d) 0.08(d)
Net realized and unrealized gain (loss) on investments
and foreign currency 2.47 2.76
------------ ------------
Total from investment operations 2.55 2.84
- --------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.11) --
From net realized gains -- --
------------ ------------
Total distributions (0.11) --
- --------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 18.42 $ 15.98
Total return (e) 15.98%(f) 21.61%(f)(g)
- --------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 272,178 $ 227,454
Ratio of expenses to average net assets (h) 1.02% 1.08%(i)
Ratio of net investment income to average net assets (h) 0.44% 0.82%(i)
Waiver 0.03% 0.03%(i)
Portfolio turnover rate 106% 68%(g)
- --------------------------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31, PERIOD ENDED
------------------------------- DECEMBER 31,
CLASS Z SHARES 2002 (b) 2001 2000 (c)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 14.52 $ 11.23 $ 10.00
- ---------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.10(d) 0.05 0.02
Net realized and unrealized gain (loss) on investments
and foreign currency (1.35) 3.29 1.23
------------ ------------ ------------
Total from investment operations (1.25) 3.34 1.25
- ---------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.11) (0.05) (0.02)
From net realized gains (0.02) -- --
------------ ------------ ------------
Total distributions (0.13) (0.05) (0.02)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 13.14 $ 14.52 $ 11.23
Total return (e) (8.56)%(f) 29.76% 12.25%(f)(g)
- ---------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 209,610 $ 139,504 $ 9,526
Ratio of expenses to average net assets (h) 1.23% 1.13% 1.34%(i)
Ratio of net investment income to average net assets (h) 0.62% 0.71% 1.92%(i)
Waiver 0.03% -- 3.97%(i)
Portfolio turnover rate 188% 278% 64%(g)
- ---------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) On November 1, 2002, the existing Fund shares were renamed Class Z shares.
(c) The Fund commenced investment operations on October 27, 2000. Per share
data, total return and portfolio turnover rate reflect activity from that
date.
(d) Per share data was calculated using average shares outstanding during the
period.
(e) Total return at net asset value assuming all distributions reinvested.
(f) Had the Investment Advisor not waived a portion of expenses, total return
would have been reduced.
(g) Not annualized.
(h) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(i) Annualized.
192
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA BALANCED FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS A SHARES 2004 2003 (a) 2002 (b)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 19.18 $ 17.52 $ 17.58
- ---------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.29 0.16 0.03
Net realized and unrealized gain on investments 0.67 1.64 --(d)
------------ ------------ ------------
Total from investment operations 0.96 1.80 0.03
- ---------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.28) (0.14) (0.09)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 19.86 $ 19.18 $ 17.52
Total return (e) 4.99% 10.35%(f) 0.19%(f)
- ---------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 2,577 $ 670 $ 146
Ratio of expenses to average net assets (g) 1.02% 1.42%(h) 1.17%(h)
Ratio of net investment income to average net assets (g) 1.45% 1.32%(h) 2.03%(h)
Portfolio turnover rate 158% 110%(f) 98%
- ---------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class A shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Rounds to less than $0.01 per share.
(e) Total return at net asset value assuming all distributions reinvested and
no initial sales charge or contingent deferred sales charge.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS B SHARES 2004 2003 (a) 2002 (b)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 19.16 $ 17.52 $ 17.58
- ---------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.14 0.07 0.02
Net realized and unrealized gain (loss) on investments 0.66 1.65 (0.01)
------------ ------------ ------------
Total from investment operations 0.80 1.72 0.01
- ---------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.13) (0.08) (0.07)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 19.83 $ 19.16 $ 17.52
Total return (d) 4.17% 9.83%(e) 0.06%(e)
- ---------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 7,286 $ 3,349 $ 608
Ratio of expenses to average net assets (f) 1.77% 2.17%(g) 1.92%(g)
Ratio of net investment income to average net assets (f) 0.71% 0.59%(g) 1.28%(g)
Portfolio turnover rate 158% 110%(e) 98%
- ---------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class B shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested and
no contingent deferred sales charge.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
193
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA BALANCED FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
PERIOD ENDED
AUGUST 31,
CLASS C SHARES 2004 (a)
- --------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 19.59
- --------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (b) 0.13
Net realized and unrealized gain on investments 0.23
------------
Total from investment operations 0.36
- --------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.12)
- --------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 19.83
Total return (c)(d) 1.82%
- --------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 730
Ratio of expenses to average net assets (e)(f) 1.80%
Ratio of net investment income to average net assets (e)(f) 0.72%
Portfolio turnover rate 158%
- --------------------------------------------------------------------------------
(a) Class C shares were initially offered on October 13, 2003. Per share data
and total return reflect 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 contingent deferred sales charge.
(d) Not annualized.
(e) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(f) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS D SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 19.17 $ 17.51 $ 17.58
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.15 0.11 0.02
Net realized and unrealized gain (loss) on investments 0.65 1.64 (0.02)
------------ ------------ ------------
Total from investment operations 0.80 1.75 --
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.15) (0.09) (0.07)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 19.82 $ 19.17 $ 17.51
Total return (d) 4.14% 10.01%(e) 0.01%(e)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 361 $ 770 $ 446
Ratio of expenses to average net assets (f) 1.77% 1.87%(g) 1.92%(g)
Ratio of net investment income to average net assets (f) 0.74% 0.89%(g) 1.28%(g)
Portfolio turnover rate 158% 110%(e) 98%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class D shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested and
no contingent deferred sales charge.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
194
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA BALANCED FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED
AUGUST 31, AUGUST 31,
CLASS Z SHARES 2004 2003 (a)
- -------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 19.19 $ 17.51
- -------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.35(c) 0.24(c)
Net realized and unrealized gain (loss)
on investments 0.66 1.64
------------ ------------
Total from investment operations 1.01 1.88
- -------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.36) (0.20)
From net realized gains -- --
------------ ------------
Total distributions (0.36) (0.20)
- -------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 19.84 $ 19.19
Total return (e) 5.27% 10.81%(f)
- -------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 483,746 $ 640,402
Ratio of expenses to average net assets (g) 0.77% 0.77%(h)
Ratio of net investment income to
average net assets (g) 1.73% 2.03%(h)
Portfolio turnover rate 158% 110%(f)
- -------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
---------------------------------------------------------------------
CLASS Z SHARES 2002 (b) 2001 2000 1999
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 20.67 $ 22.96 $ 24.72 $ 23.17
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.47(c) 0.57(d) 0.67 0.69
Net realized and unrealized gain (loss)
on investments (3.13) (2.27)(d) (0.41) 2.21
------------ ------------ ------------ ------------
Total from investment operations (2.66) (1.70) 0.26 2.90
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.50) (0.59) (0.68) (0.69)
From net realized gains -- -- (1.34) (0.66)
------------ ------------ ------------ ------------
Total distributions (0.50) (0.59) (2.02) (1.35)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 17.51 $ 20.67 $ 22.96 $ 24.72
Total return (e) (12.97)% (7.40)% 0.82% 12.70%
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 668,290 $ 983,749 $ 1,126,854 $ 1,040,940
Ratio of expenses to average net assets (g) 0.70% 0.67% 0.65% 0.66%
Ratio of net investment income to
average net assets (g) 2.50% 2.70%(d) 2.73% 2.85%
Portfolio turnover rate 98% 111% 105% 133%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) On November 1, 2002, the existing Fund shares were renamed Class Z shares.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Effective January 1, 2001, the Fund adopted the provisions of the AICPA
Audit and Accounting Guide for Investment Companies and began amortizing
premium and accreting discount on all debt securities. The effect of this
change for the year ended December 31, 2001 was to decrease net investment
income per share by $0.01, decrease net realized and unrealized loss per
share by $0.01 and decrease the ratio of net investment income to average
net assets from 2.73% to 2.70%. Per share data and ratios for periods prior
to December 31, 2001 have not been restated to reflect this change in
presentation.
(e) Total return at net asset value assuming all distributions reinvested.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
195
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA SHORT TERM BOND FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS A SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 8.62 $ 8.67 $ 8.63
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.17 0.10 0.04
Net realized and unrealized gain (loss) on
investments and futures contracts 0.02 (0.03) 0.04
------------ ------------ ------------
Total from investment operations 0.19 0.07 0.08
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.17) (0.12) (0.04)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 8.64 $ 8.62 $ 8.67
Total return (d)(e) 2.25% 0.82%(f) 0.94%(f)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 28,146 $ 37,261 $ 5,543
Ratio of expenses to average net assets (g) 0.91% 1.00%(h) 1.00%(h)
Ratio of net investment income to average net assets (g) 2.00% 1.78%(h) 3.53%(h)
Reimbursement 0.05% 0.05%(h) 0.02%(h)
Portfolio turnover rate 77% 137%(f) 182%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class A shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested and
no initial sales charge or contingent deferred sales charge.
(e) Had the Investment Advisor not reimbursed a portion of expenses, total
return would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS B SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 8.62 $ 8.67 $ 8.63
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.11 0.07 0.03
Net realized and unrealized gain (loss) on
investments and futures contracts 0.01 (0.04) 0.04
------------ ------------ ------------
Total from investment operations 0.12 0.03 0.07
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.10) (0.08) (0.03)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 8.64 $ 8.62 $ 8.67
Total return (d)(e) 1.44% 0.35%(f) 0.77%(f)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 25,125 $ 26,965 $ 6,261
Ratio of expenses to average net assets (g) 1.66% 1.75%(h) 1.75%(h)
Ratio of net investment income to average net assets (g) 1.25% 1.16%(h) 2.78%(h)
Reimbursement 0.08% 0.15%(h) 0.04%(h)
Portfolio turnover rate 77% 137%(f) 182%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class B shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested and
no contingent deferred sales charge.
(e) Had the Investment Advisor not reimbursed a portion of expenses, total
return would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
196
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA SHORT TERM BOND FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
PERIOD ENDED
AUGUST 31,
CLASS C SHARES 2004 (a)
- -------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 8.67
- -------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (b) 0.15
Net realized and unrealized loss on
investments and futures contracts (0.04)
------------
Total from investment operations 0.11
- -------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.14)
- -------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 8.64
Total return (c)(d)(e) 1.27%
- -------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 3,128
Ratio of expenses to average net assets (f)(g) 1.06%
Ratio of net investment income to average net assets (f)(g) 1.88%
Reimbursement (g) 0.05%
Waiver (g)(h) 0.60%
Portfolio turnover rate 77%
- -------------------------------------------------------------------------------
(a) Class C shares were initially offered on October 13, 2003. Per share data
and total return reflect 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 contingent deferred sales charge.
(d) Had the Investment Advisor/Distributor not waived or reimbursed a portion
of expenses, total return would have been reduced.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
(h) Amount represents voluntary waivers of service and distribution fees.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS D SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 8.62 $ 8.67 $ 8.63
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.16 0.10 0.04
Net realized and unrealized gain (loss) on
investments and futures contracts 0.02 (0.04) 0.04
------------ ------------ ------------
Total from investment operations 0.18 0.06 0.08
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.16) (0.11) (0.04)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 8.64 $ 8.62 $ 8.67
Total return (d)(e) 2.08% 0.72%(f) 0.88%(f)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 9,809 $ 18,512 $ 5,223
Ratio of expenses to average net assets (g) 1.06% 1.15%(h) 1.15%(h)
Ratio of net investment income to average net assets (g) 1.85% 1.71%(h) 3.38%(h)
Reimbursement 0.03% 0.18%(h) 0.04%(h)
Waiver (i) 0.60% 0.60%(h) 0.60%(h)
Portfolio turnover rate 77% 137%(f) 182%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class D shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested and
no contingent deferred sales charge.
(e) Had the Investment Advisor/Distributor not waived or reimbursed a portion
of expenses, total return would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
(i) Amounts represent voluntary waivers of service and distribution fees.
197
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA SHORT TERM BOND FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS G SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 8.62 $ 8.67 $ 8.63
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.12 0.09 0.03
Net realized and unrealized gain (loss) on
investments and futures contracts 0.02 (0.05) 0.04
------------ ------------ ------------
Total from investment operations 0.14 0.04 0.07
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.12) (0.09) (0.03)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 8.64 $ 8.62 $ 8.67
Total return (d)(e) 1.65% 0.47%(f) 0.85%(f)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 1,056 $ 1,614 $ 1,874
Ratio of expenses to average net assets (g) 1.46% 1.55%(h) 1.55%(h)
Ratio of net investment income to average net assets (g) 1.44% 1.58%(h) 2.98%(h)
Reimbursement 0.16% 0.10%(h) 0.05%(h)
Portfolio turnover rate 77% 137%(f) 182%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class G shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested and
no contingent deferred sales charge.
(e) Had the Investment Advisor/Distributor not reimbursed a portion of
expenses, total return would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS T SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 8.62 $ 8.67 $ 8.63
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.18 0.13 0.04
Net realized and unrealized gain (loss) on
investments and futures contracts 0.02 (0.05) 0.04
------------ ------------ ------------
Total from investment operations 0.20 0.08 0.08
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.18) (0.13) (0.04)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 8.64 $ 8.62 $ 8.67
Total return (d)(e) 2.31% 0.93%(f) 0.95%(f)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 21,160 $ 28,230 $ 30,859
Ratio of expenses to average net assets (g) 0.81% 0.90%(h) 0.90%(h)
Ratio of net investment income to average net assets (g) 2.10% 2.25%(h) 3.63%(h)
Reimbursement 0.05% 0.04%(h) 0.02%(h)
Portfolio turnover rate 77% 137%(f) 182%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class T shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested and
no initial sales charge or contingent deferred sales charge.
(e) Had the Investment Advisor/Distributor not reimbursed a portion of
expenses, total return would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
198
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA SHORT TERM BOND FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED
AUGUST 31, AUGUST 31,
CLASS Z SHARES 2004 2003 (a)
- -------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 8.62 $ 8.67
- -------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.20(c) 0.14(c)
Net realized and unrealized gain (loss) on
investments and futures contracts 0.01 (0.05)
------------ ------------
Total from investment operations 0.21 0.09
- -------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.19) (0.14)
From net realized gains -- --
------------ ------------
Total distributions (0.19) (0.14)
- -------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 8.64 $ 8.62
Total return (f) 2.51%(g) 1.06%(g)(h)
- -------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 437,074 $ 436,593
Ratio of expenses to average net assets (i) 0.66% 0.66%(j)
Ratio of net investment income to
average net assets (i) 2.27% 2.36%(j)
Reimbursement 0.05% 0.07%(j)
Portfolio turnover rate 52% 137%(h)
- -------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
---------------------------------------------------------------------
CLASS Z SHARES 2002 (b) 2001 2000 1999
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 8.55 $ 8.36 $ 8.20 $ 8.39
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.32(c) 0.46(d) 0.42 0.33
Net realized and unrealized gain (loss) on
investments and futures contracts 0.14 0.21(d) 0.16 (0.18)
------------ ------------ ------------ ------------
Total from investment operations 0.46 0.67 0.58 0.15
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.34) (0.46) (0.42) (0.33)
From net realized gains --(e) (0.02) -- (0.01)
------------ ------------ ------------ ------------
Total distributions (0.34) (0.48) (0.42) (0.34)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 8.67 $ 8.55 $ 8.36 $ 8.20
Total return (f) 5.56% 8.07%(g) 7.26%(g) 1.80%
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 317,588 $ 62,930 $ 35,856 $ 38,072
Ratio of expenses to average net assets (i) 0.67% 0.75% 0.88% 0.91%
Ratio of net investment income to
average net assets (i) 3.86% 5.29%(d) 5.09% 4.09%
Reimbursement -- 0.16% 0.02% --
Portfolio turnover rate 182% 137% 147% 211%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) On November 1, 2002, the existing Fund shares were renamed Class Z shares.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Effective January 1, 2001, the Fund adopted the provisions of the AICPA
Audit and Accounting Guide for Investment Companies and began amortizing
premium and accreting discount on all debt securities. The effect of this
change for the year ended December 31, 2001 was to increase the ratio of
net investment income to average net assets from 5.26% to 5.29%. The impact
to net investment income and net realized and unrealized gain per share was
less than $0.01. Per share data and ratios for periods prior to December
31, 2001 have not been restated to reflect this change in presentation.
(e) Rounds to less than $0.01 per share.
(f) Total return at net asset value assuming all distributions reinvested.
(g) Had the Investment Advisor not reimbursed a portion of expenses, total
return would have been reduced.
(h) Not annualized.
(i) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(j) Annualized.
199
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA FIXED INCOME SECURITIES FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS A SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 13.34 $ 13.52 $ 13.42
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.50 0.26 0.11
Net realized and unrealized gain (loss) on investments 0.17 (0.14) 0.08
------------ ------------ ------------
Total from investment operations 0.67 0.12 0.19
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.52) (0.30) (0.09)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 13.49 $ 13.34 $ 13.52
Total return (d) 5.13% 0.84%(e) 1.41%(e)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 10,707 $ 7,503 $ 945
Ratio of expenses to average net assets (f) 1.05% 1.44%(g) 0.92%(g)
Ratio of net investment income to average net assets (f) 3.70% 2.84%(g) 4.78%(g)
Portfolio turnover rate 124% 161%(e) 103%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class A shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested and
no initial sales charge or contingent deferred sales charge.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS B SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 13.34 $ 13.52 $ 13.42
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.40 0.20 0.09
Net realized and unrealized gain (loss) on investments 0.17 (0.15) 0.08
------------ ------------ ------------
Total from investment operations 0.57 0.05 0.17
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.42) (0.23) (0.07)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 13.49 $ 13.34 $ 13.52
Total return (d) 4.33% 0.34%(e) 1.27%(e)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 4,334 $ 4,410 $ 1,466
Ratio of expenses to average net assets (f) 1.82% 2.10%(g) 1.71%(g)
Ratio of net investment income to average net assets (f) 2.94% 2.22%(g) 3.99%(g)
Portfolio turnover rate 124% 161%(e) 103%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class B shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested and
no contingent deferred sales charge.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
200
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA FIXED INCOME SECURITIES FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
PERIOD ENDED
AUGUST 31,
CLASS C SHARES 2004 (a)
- -------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 13.50
- -------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (b) 0.37
Net realized and unrealized gain on investments 0.02
------------
Total from investment operations 0.39
- -------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.40)
- -------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 13.49
Total return (c)(d)(e) 2.94%
- -------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 158
Ratio of expenses to average net assets (f)(g) 1.64%
Ratio of net investment income to average net assets (f)(g) 3.09%
Waiver (g)(h) 0.15%
Portfolio turnover rate 124%
- -------------------------------------------------------------------------------
(a) Class C shares were initially offered on October 13, 2003. Per share data
and total return reflect 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 contingent deferred sales charge.
(d) Had the Distributor not waived a portion of expenses, total return would
have been reduced.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
(h) Amount represents voluntary waiver of service and distribution fees.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS D SHARES 2004 2003 (a) 2002 (b)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 13.34 $ 13.52 $ 13.42
- ---------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.42 0.22 0.09
Net realized and unrealized gain (loss) on investments 0.17 (0.15) 0.08
------------ ------------ ------------
Total from investment operations 0.59 0.07 0.17
- ---------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.44) (0.25) (0.07)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 13.49 $ 13.34 $ 13.52
Total return (d)(e) 4.51% 0.51%(f) 1.30%(f)
- ---------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 1,745 $ 2,632 $ 427
Ratio of expenses to average net assets (g) 1.65% 1.79%(h) 1.58%(h)
Ratio of net investment income to average net assets (g) 3.11% 2.44%(h) 4.12%(h)
Waiver (i) 0.15% 0.15%(h) 0.15%(h)
Portfolio turnover rate 124% 161%(f) 103%
- ---------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class D shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested and
no contingent deferred sales charge.
(e) Had the Distributor not waived a portion of expenses, total return would
have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
(i) Amount represents voluntary waiver of service and distribution fees.
201
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA FIXED INCOME SECURITIES FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED
AUGUST 31, AUGUST 31,
CLASS Z SHARES 2004 2003 (a)
- -------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 13.34 $ 13.52
- -------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.53(c) 0.33(c)
Net realized and unrealized gain (loss)
on investments 0.18 (0.16)
------------ ------------
Total from investment operations 0.71 0.17
- -------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.56) (0.35)
From net realized gains -- --
------------ ------------
Total distributions (0.56) (0.35)
- -------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 13.49 $ 13.34
Total return (f) 5.40% 1.26%(g)
- -------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 324,325 $ 506,046
Ratio of expenses to average net assets (h) 0.80% 0.77%(i)
Ratio of net investment income to
average net assets (h) 3.96% 3.66%(i)
Portfolio turnover rate 124% 161%(g)
- -------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
---------------------------------------------------------------------
CLASS Z SHARES 2002 (b) 2001 2000 1999
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 13.22 $ 12.97 $ 12.44 $ 13.42
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.67(c) 0.77(d) 0.82 0.78
Net realized and unrealized gain (loss)
on investments 0.31 0.26(d) 0.53 (0.98)
------------ ------------ ------------ ------------
Total from investment operations 0.98 1.03 1.35 (0.20)
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.68) (0.78) (0.82) (0.78)
From net realized gains -- -- -- --(e)
------------ ------------ ------------ ------------
Total distributions (0.68) (0.78) (0.82) (0.78)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 13.52 $ 13.22 $ 12.97 $ 12.44
Total return (f) 7.65% 8.13% 11.27% (1.50)%
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 547,524 $ 465,743 $ 378,799 $ 397,147
Ratio of expenses to average net assets (h) 0.67% 0.66% 0.66% 0.64%
Ratio of net investment income to
average net assets (h) 5.03% 5.83%(d) 6.53% 6.03%
Portfolio turnover rate 103% 110% 105% 155%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) On November 1, 2002, the existing Fund shares were renamed Class Z shares.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Effective January 1, 2001, the Fund adopted the provisions of the AICPA
Audit and Accounting Guide for Investment Companies and began amortizing
premium and accreting discount on all debt securities. The effect of this
change for the year ended December 31, 2001 was to decrease net investment
income per share by $0.01, increase net realized and unrealized gain per
share by $0.01 and decrease the ratio of net investment income to average
net assets from 5.92% to 5.83%. Per share data and ratios for periods prior
to December 31, 2001 have not been restated to reflect this change in
presentation.
(e) Rounds to less than $0.01 per share.
(f) Total return at net asset value assuming all distributions reinvested.
(g) Not annualized.
(h) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(i) Annualized.
202
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA NATIONAL MUNICIPAL BOND FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS A SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.11 $ 10.28 $ 10.22
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.34 0.24 0.06
Net realized and unrealized gain (loss) on investments 0.28 (0.16) 0.10
------------ ------------ ------------
Total from investment operations 0.62 0.08 0.16
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.35) (0.24) (0.06)
From net realized gains (0.08) (0.01) (0.04)
------------ ------------ ------------
Total distributions (0.43) (0.25) (0.10)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 10.30 $ 10.11 $ 10.28
Total return (d)(e) 6.22% 0.75%(f) 1.59%(f)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 1,286 $ 398 $ 67
Ratio of expenses to average net assets (g) 0.90% 0.90%(h) 0.90%(h)
Ratio of net investment income to average net assets (g) 3.35% 3.49%(h) 3.85%(h)
Reimbursement 1.59% 2.87%(h) 0.56%(h)
Portfolio turnover rate 22% 12%(f) 43%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class A shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested and
no initial sales charge or contingent deferred sales charge.
(e) Had the Investment Advisor not reimbursed a portion of expenses, total
return would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS B SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.11 $ 10.28 $ 10.22
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.27 0.19 0.05
Net realized and unrealized gain (loss) on investments 0.27 (0.16) 0.10
------------ ------------ ------------
Total from investment operations 0.54 0.03 0.15
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.27) (0.19) (0.05)
From net realized gains (0.08) (0.01) (0.04)
------------ ------------ ------------
Total distributions (0.35) (0.20) (0.09)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 10.30 $ 10.11 $ 10.28
Total return (d)(e) 5.44% 0.25%(f) 1.47%(f)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 762 $ 593 $ 72
Ratio of expenses to average net assets (g) 1.65% 1.65%(h) 1.65%(h)
Ratio of net investment income to average net assets (g) 2.67% 2.77%(h) 3.10%(h)
Reimbursement 1.51% 2.82%(h) 0.56%(h)
Portfolio turnover rate 22% 12%(f) 43%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class B shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested and
no contingent deferred sales charge.
(e) Had the Investment Advisor not reimbursed a portion of expenses, total
return would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
203
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA NATIONAL MUNICIPAL BOND FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
PERIOD ENDED
AUGUST 31,
CLASS C SHARES 2004 (a)
- -------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.26
- -------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (b) 0.27
Net realized and unrealized gain on investments 0.12
------------
Total from investment operations 0.39
- -------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.27)
From net realized gains (0.08)
------------
Total distributions (0.35)
- -------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 10.30
Total return (c)(d)(e) 3.89%
- -------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 363
Ratio of expenses to average net assets (f)(g) 1.30%
Ratio of net investment income to average net assets (f)(g) 2.96%
Reimbursement (g) 1.70%
Waiver (g)(h) 0.35%
Portfolio turnover rate 22%
- -------------------------------------------------------------------------------
(a) Class C shares were initially offered on October 13, 2003. Per share data
and total return reflect 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 contingent deferred sales charge.
(d) Had the Investment Advisor/Distributor not waived or reimbursed a portion
of expenses, total return would have been reduced.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
(h) Amount represents voluntary waiver of service and distribution fees.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS D SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.11 $ 10.28 $ 10.22
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.31 0.21 0.05
Net realized and unrealized gain (loss) on investments 0.27 (0.16) 0.10
------------ ------------ ------------
Total from investment operations 0.58 0.05 0.15
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.31) (0.21) (0.05)
From net realized gains (0.08) (0.01) (0.04)
------------ ------------ ------------
Total distributions (0.39) (0.22) (0.09)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 10.30 $ 10.11 $ 10.28
Total return (d)(e) 5.79% 0.47%(f) 1.51%(f)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 433 $ 443 $ 50
Ratio of expenses to average net assets (g) 1.30% 1.30%(h) 1.30%(h)
Ratio of net investment income to average net assets (g) 3.02% 3.00%(h) 3.45%(h)
Reimbursement 1.43% 2.86%(h) 0.56%(h)
Waiver (i) 0.35% 0.35%(h) 0.35%(h)
Portfolio turnover rate 22% 12%(f) 43%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class D shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested and
no contingent deferred sales charge.
(e) Had the Investment Advisor/Distributor not waived or reimbursed a portion
of expenses, total return would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
(i) Amounts represent voluntary waiver of service and distribution fees.
204
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA NATIONAL MUNICIPAL BOND FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED
AUGUST 31, AUGUST 31,
CLASS Z SHARES 2004 2003 (a)
- -------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.11 $ 10.28
- -------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.38(d) 0.27(d)
Net realized and unrealized gain
(loss) on investments 0.26 (0.17)
------------ ------------
Total from investment operations 0.64 0.10
- -------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.37) (0.26)
From net realized gains (0.08) (0.01)
------------ ------------
Total distributions (0.45) (0.27)
- -------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 10.30 $ 10.11
Total return (f)(g) 6.47% 1.00%(h)
- -------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 11,967 $ 14,349
Ratio of expenses to average net assets (i) 0.65% 0.65%(j)
Ratio of net investment income to
average net assets (i) 3.68% 3.86%(j)
Reimbursement 1.40% 1.90%(j)
Portfolio turnover rate 22% 12%(h)
- -------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31, PERIOD ENDED
-------------------------------------------------- DECEMBER 31,
CLASS Z SHARES 2002 (b) 2001 2000 1999 (c)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 9.77 $ 9.82 $ 9.28 $ 10.00
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.41(d) 0.44(e) 0.44 0.34
Net realized and unrealized gain
(loss) on investments 0.55 (0.03)(e) 0.54 (0.72)
------------ ------------ ------------ ------------
Total from investment operations 0.96 0.41 0.98 (0.38)
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.41) (0.44) (0.44) (0.34)
From net realized gains (0.04) (0.02) -- --
------------ ------------ ------------ ------------
Total distributions (0.45) (0.46) (0.44) (0.34)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 10.28 $ 9.77 $ 9.82 $ 9.28
Total return (f)(g) 10.04% 4.16% 10.87% (3.93)%(h)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 16,470 $ 13,769 $ 10,898 $ 10,135
Ratio of expenses to average net assets (i) 0.65% 0.65% 0.65% 0.65%(j)
Ratio of net investment income to
average net assets (i) 4.10% 4.44%(e) 4.68% 4.21%(j)
Reimbursement 0.50% 0.66% 0.64% 1.07%(j)
Portfolio turnover rate 43% 20% 21% 12%(h)
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) On November 1, 2002, the existing Fund shares were renamed Class Z shares.
(c) The Fund commenced investment operations on February 10, 1999. Per share
data, total return and portfolio turnover rate reflect activity from that
date.
(d) Per share data was calculated using average shares outstanding during the
period.
(e) Effective January 1, 2001, the Fund adopted the provisions of the AICPA
Audit and Accounting Guide for Investment Companies and began amortizing
premium and accreting discount on all debt securities. The effect of this
change for the year ended December 31, 2001 was to decrease the ratio of
net investment income to average net assets from 4.47% to 4.44%. The impact
to net investment income and net realized and unrealized loss per share was
less than $0.01. Per share data and ratios for periods prior to December
31, 2001 have not been restated to reflect this change in presentation.
(f) Total return at net asset value assuming all distributions reinvested.
(g) Had the Investment Advisor not reimbursed a portion of expenses, total
return would have been reduced.
(h) Not annualized.
(i) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(j) Annualized.
205
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA OREGON MUNICIPAL BOND FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS A SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 12.25 $ 12.50 $ 12.52
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.46 0.29 0.08
Net realized and unrealized gain (loss) on investments 0.34 (0.22) 0.07
------------ ------------ ------------
Total from investment operations 0.80 0.07 0.15
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.46) (0.31) (0.08)
From net realized gains (0.14) (0.01) (0.09)
------------ ------------ ------------
Total distributions (0.60) (0.32) (0.17)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 12.45 $ 12.25 $ 12.50
Total return (d) 6.68% 0.56%(e) 1.19%(e)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 3,680 $ 2,138 $ 477
Ratio of expenses to average net assets (f) 0.92% 1.16%(g) 0.92%(g)
Ratio of net investment income to average net assets (f) 3.73% 3.52%(g) 4.11%(g)
Portfolio turnover rate 11% 10%(e) 21%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class A shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested and
no initial sales charge or contingent deferred sales charge.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS B SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 12.25 $ 12.50 $ 12.52
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.37 0.24 0.06
Net realized and unrealized gain (loss) on investments 0.34 (0.23) 0.08
------------ ------------ ------------
Total from investment operations 0.71 0.01 0.14
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.37) (0.25) (0.07)
From net realized gains (0.14) (0.01) (0.09)
------------ ------------ ------------
Total distributions (0.51) (0.26) (0.16)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 12.45 $ 12.25 $ 12.50
Total return (d) 5.87% 0.05%(e) 1.10%(e)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 1,190 $ 999 $ 373
Ratio of expenses to average net assets (f) 1.68% 1.86%(g) 1.67%(g)
Ratio of net investment income to average net assets (f) 2.97% 2.83%(g) 3.36%(g)
Portfolio turnover rate 11% 10%(e) 21%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class B shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested and
no contingent deferred sales charge.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
206
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA OREGON MUNICIPAL BOND FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
PERIOD ENDED
AUGUST 31,
CLASS C SHARES 2004 (a)
- -------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 12.42
- -------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (b) 0.36
Net realized and unrealized gain on investments 0.18
------------
Total from investment operations 0.54
- -------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.37)
From net realized gains (0.14)
------------
Total distributions (0.51)
- -------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 12.45
Total return (c)(d)(e) 4.41%
- -------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 278
Ratio of expenses to average net assets (f)(g) 1.30%
Ratio of net investment income to average net assets (f)(g) 3.28%
Waiver (g)(h) 0.35%
Portfolio turnover rate 11%
- -------------------------------------------------------------------------------
(a) Class C shares were initially offered on October 13, 2003. Per share data
and total return reflect 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 contingent deferred sales charge.
(d) Had the Distributor not waived a portion of expenses, total return would
have been reduced.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
(h) Amount represents voluntary waiver of service and distribution fees.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS D SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 12.25 $ 12.50 $ 12.52
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.41 0.27 0.07
Net realized and unrealized gain (loss) on investments 0.34 (0.23) 0.07
------------ ------------ ------------
Total from investment operations 0.75 0.04 0.14
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.41) (0.28) (0.07)
From net realized gains (0.14) (0.01) (0.09)
------------ ------------ ------------
Total distributions (0.55) (0.29) (0.16)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 12.45 $ 12.25 $ 12.50
Total return (d)(e) 6.25% 0.32%(f) 1.14%(f)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 790 $ 700 $ 448
Ratio of expenses to average net assets (g) 1.33% 1.43%(h) 1.32%(h)
Ratio of net investment income to average net assets (g) 3.34% 3.30%(h) 3.71%(h)
Waiver (i) 0.35% 0.35%(h) 0.35%(h)
Portfolio turnover rate 11% 10%(f) 21%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class D shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested and
no contingent deferred sales charge.
(e) Had the Distributor not waived a portion of expenses, total return would
have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
(i) Amounts represent voluntary waiver of service and distribution fees.
207
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA OREGON MUNICIPAL BOND FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED
AUGUST 31, AUGUST 31,
CLASS Z SHARES 2004 2003 (a)
- -------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 12.25 $ 12.50
- -------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.50(c) 0.34(c)
Net realized and unrealized gain (loss)
on investments 0.34 (0.23)
------------ ------------
Total from investment operations 0.84 0.11
- -------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.50) (0.35)
From net realized gains (0.14) (0.01)
------------ ------------
Total distributions (0.64) (0.36)
- -------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 12.45 $ 12.25
Total return (e) 6.97% 0.83%(f)
- -------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 434,509 $ 485,427
Ratio of expenses to average net assets (g) 0.65% 0.68%(h)
Ratio of net investment income to
average net assets (g) 4.03% 4.13%(h)
Portfolio turnover rate 11% 10%(f)
- -------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
---------------------------------------------------------------------
CLASS Z SHARES 2002 (b) 2001 2000 1999
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 12.08 $ 12.13 $ 11.56 $ 12.46
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.55(c) 0.57(d) 0.58 0.56
Net realized and unrealized gain (loss)
on investments 0.54 (0.02)(d) 0.58 (0.88)
------------ ------------ ------------ ------------
Total from investment operations 1.09 0.55 1.16 (0.32)
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.55) (0.57) (0.58) (0.56)
From net realized gains (0.12) (0.03) (0.01) (0.02)
------------ ------------ ------------ ------------
Total distributions (0.67) (0.60) (0.59) (0.58)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 12.50 $ 12.08 $ 12.13 $ 11.56
Total return (e) 9.24% 4.55% 10.28% (2.65)%
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 508,865 $ 491,638 $ 436,544 $ 409,919
Ratio of expenses to average net assets (g) 0.58% 0.57% 0.58% 0.57%
Ratio of net investment income to
average net assets (g) 4.45% 4.64%(d) 4.92% 4.64%
Portfolio turnover rate 21% 14% 22% 28%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) On November 1, 2002, the existing Fund shares were renamed Class Z shares.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Effective January 1, 2001, the Fund adopted the provisions of the AICPA
Audit and Accounting Guide for Investment Companies and began amortizing
premium and accreting discount on all debt securities. The effect of this
change for the year ended December 31, 2001 was less than $0.01 to net
investment income and net realized and unrealized loss per share and less
than 0.01% to the ratio of net investment income to average net assets. Per
share data and ratios for the periods prior to December 31, 2001 have not
been restated to reflect this change in presentation.
(e) Total return at net asset value assuming all distributions reinvested.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
208
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA HIGH YIELD FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS A SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 8.49 $ 8.37 $ 8.17
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.50 0.33 0.09
Net realized and unrealized gain on investments 0.24 0.15 0.20
------------ ------------ ------------
Total from investment operations 0.74 0.48 0.29
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.54) (0.36) (0.09)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 8.69 $ 8.49 $ 8.37
Total return (d) 8.90% 5.81%(e) 3.50%(e)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 335,841 $ 193,267 $ 33,992
Ratio of expenses to average net assets (f) 1.01% 1.07%(g) 1.15%(g)
Ratio of net investment income to average net assets (f) 5.74% 5.82%(g) 6.46%(g)
Portfolio turnover rate 41% 38%(e) 42%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class A shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested and
no initial sales charge or contingent deferred sales charge.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS B SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 8.49 $ 8.37 $ 8.17
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.43 0.28 0.07
Net realized and unrealized gain on investments 0.24 0.15 0.20
------------ ------------ ------------
Total from investment operations 0.67 0.43 0.27
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.47) (0.31) (0.07)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 8.69 $ 8.49 $ 8.37
Total return (d) 8.07% 5.20%(e) 3.33%(e)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 102,038 $ 89,950 $ 16,701
Ratio of expenses to average net assets (f) 1.77% 1.94%(g) 1.90%(g)
Ratio of net investment income to average net assets (f) 4.97% 4.93%(g) 5.71%(g)
Portfolio turnover rate 41% 38%(e) 42%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class B shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested and
no contingent deferred sales charge.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
209
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA HIGH YIELD FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
PERIOD ENDED
AUGUST 31,
CLASS C SHARES 2004 (a)
- -------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 8.64
- -------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (b) 0.39
Net realized and unrealized gain on investments 0.09
------------
Total from investment operations 0.48
- -------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.43)
- -------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 8.69
Total return (c)(d)(e) 5.65%
- -------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 20,126
Ratio of expenses to average net assets (f)(g) 1.61%
Ratio of net investment income to average net assets (f)(g) 5.03%
Waiver (g)(h) 0.15%
Portfolio turnover rate 41%
- -------------------------------------------------------------------------------
(a) Class C shares were initially offered on October 13, 2003. Per share data
and total return reflect 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 contingent deferred sales charge.
(d) Had the Distributor not waived a portion of expenses, total return would
have been reduced.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
(h) Amount represents voluntary waiver of service and distribution fees.
YEAR ENDED PERIOD ENDED PERIOD ENDED
AUGUST 31, AUGUST 31, DECEMBER 31,
CLASS D SHARES 2004 2003 (a) 2002 (b)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 8.49 $ 8.37 $ 8.17
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (c) 0.44 0.29 0.07
Net realized and unrealized gain on investments 0.24 0.15 0.20
------------ ------------ ------------
Total from investment operations 0.68 0.44 0.27
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.48) (0.32) (0.07)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 8.69 $ 8.49 $ 8.37
Total return (d)(e) 8.23% 5.35%(f) 3.35%(f)
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 86,854 $ 103,559 $ 18,035
Ratio of expenses to average net assets (g) 1.62% 1.73%(h) 1.75%(h)
Ratio of net investment income to average net assets (g) 5.12% 5.12%(h) 5.86%(h)
Waiver (i) 0.15% 0.15%(h) 0.15%(h)
Portfolio turnover rate 41% 38%(f) 42%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) Class D shares were initially offered on November 1, 2002. Per share data
and total return reflect activity from that date.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested and
no contingent deferred sales charge.
(e) Had the Distributor not waived a portion of expenses, total return would
have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
(i) Amounts represent voluntary waiver of service and distribution fees.
210
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA HIGH YIELD FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED
AUGUST 31, AUGUST 31,
CLASS Z SHARES 2004 2003 (a)
- -------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 8.49 $ 8.37
- -------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.52(c) 0.35(c)
Net realized and unrealized gain (loss)
on investments 0.24 0.15
------------ ------------
Total from investment operations 0.76 0.50
- -------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.56) (0.38)
From net realized gains -- --
------------ ------------
Total distributions (0.56) (0.38)
- -------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 8.69 $ 8.49
Total return (e) 9.16% 6.04%(f)
- -------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 1,186,454 $ 1,197,340
Ratio of expenses to average net assets (g) 0.77% 0.82%(h)
Ratio of net investment income to
average net assets (g) 5.97% 6.19%(h)
Portfolio turnover rate 41% 38%(f)
- -------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
---------------------------------------------------------------------
CLASS Z SHARES 2002 (b) 2001 2000 1999
------------ ------------ ------------ ------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 8.87 $ 8.98 $ 9.32 $ 9.84
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.57(c) 0.67(d) 0.75 0.74
Net realized and unrealized gain (loss)
on investments (0.48) (0.09)(d) (0.34) (0.51)
------------ ------------ ------------ ------------
Total from investment operations 0.09 0.58 0.41 0.23
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.59) (0.69) (0.75) (0.74)
From net realized gains -- -- -- (0.01)
------------ ------------ ------------ ------------
Total distributions (0.59) (0.69) (0.75) (0.75)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 8.37 $ 8.87 $ 8.98 $ 9.32
Total return (e) 1.17% 6.63% 4.61% 2.38%
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 702,785 $ 238,994 $ 97,575 $ 71,678
Ratio of expenses to average net assets (g) 0.77% 0.85% 0.93% 0.91%
Ratio of net investment income to
average net assets (g) 6.84% 7.47%(d) 8.22% 7.71%
Portfolio turnover rate 42% 69% 50% 49%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) On November 1, 2002, the existing Fund shares were renamed Class Z shares.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Effective January 1, 2001, the Fund adopted the provisions of the AICPA
Audit and Accounting Guide for Investment Companies and began amortizing
premium and accreting discount on all debt securities. The effect of this
change for the year ended December 31, 2001 was to decrease net investment
income per share by $0.02, decrease net realized and unrealized loss per
share by $0.02 and decrease the ratio of net investment income to average
net assets from 7.64% to 7.47%. Per share data and ratios for periods prior
to December 31, 2001 have not been restated to reflect this change in
presentation.
(e) Total return at net asset value assuming all distributions reinvested.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(h) Annualized.
211
FINANCIAL HIGHLIGHTS ___________________________________________________________
COLUMBIA DAILY INCOME COMPANY
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD
YEAR ENDED PERIOD ENDED
AUGUST 31, AUGUST 31,
CLASS Z SHARES 2004 2003 (a)
- -------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.000 $ 1.000
- -------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.004(c) 0.004(c)
- -------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.004) (0.004)
- -------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 1.000 $ 1.000
Total return (d) 0.36% 0.40%(e)
- -------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 661,114 $ 898,164
Ratio of expenses to average net assets (f) 0.71% 0.69%(g)
Ratio of net investment income to
average net assets (f) 0.38% 0.53%(g)
- -------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
---------------------------------------------------------------------
CLASS Z SHARES 2002 (b) 2001 2000 1999
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000
- --------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.012(c) 0.036 0.058 0.046
- --------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
From net investment income (0.012) (0.036) (0.058) (0.046)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000
Total return (d) 1.17% 3.70% 6.00% 4.71%
- --------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $ 1,136,075 $ 1,253,535 $ 1,198,151 $ 1,165,289
Ratio of expenses to average net assets (f) 0.60% 0.60% 0.60% 0.64%
Ratio of net investment income to
average net assets (f) 1.16% 3.61% 5.82% 4.61%
- --------------------------------------------------------------------------------------------------------------------
(a) The Fund changed its fiscal year end from December 31 to August 31.
(b) On November 1, 2002, the existing Fund shares were renamed Class Z shares.
(c) Per share data was calculated using average shares outstanding during the
period.
(d) Total return at net asset value assuming all distributions reinvested.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements, if applicable, had an impact of less than 0.01%.
(g) Annualized.
212
REPORT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM ______________________________________________
COLUMBIA FUNDS
TO THE BOARD OF DIRECTORS AND THE SHAREHOLDERS OF:
COLUMBIA COMMON STOCK FUND, INC.
COLUMBIA GROWTH FUND, INC.
COLUMBIA INTERNATIONAL STOCK FUND, INC.
COLUMBIA MID CAP GROWTH FUND, INC. (FORMERLY COLUMBIA SPECIAL FUND, INC.)
COLUMBIA SMALL CAP GROWTH FUND, INC. (FORMERLY COLUMBIA SMALL CAP FUND, INC.)
COLUMBIA REAL ESTATE EQUITY FUND, INC.
COLUMBIA TECHNOLOGY FUND, INC.
COLUMBIA STRATEGIC INVESTOR FUND, INC. (FORMERLY COLUMBIA STRATEGIC
VALUE FUND, INC.)
COLUMBIA BALANCED FUND, INC.
COLUMBIA SHORT TERM BOND FUND, INC.
COLUMBIA FIXED INCOME SECURITIES FUND, INC.
COLUMBIA NATIONAL MUNICIPAL BOND FUND, INC.
COLUMBIA OREGON MUNICIPAL BOND FUND, INC.
COLUMBIA HIGH YIELD FUND, INC.
COLUMBIA DAILY INCOME COMPANY
In our opinion, the accompanying statements of assets and liabilities, including
the investment portfolios, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of the above Funds (the "Funds") at
August 31, 2004, and the results of their operations, the changes in their net
assets, and their financial highlights for the periods indicated, in conformity
with accounting principles generally accepted in the United States of America.
These financial statements and financial highlights (hereafter referred to as
"financial statements") are the responsibility of the Funds' management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with the standards of the Public Company Accounting Oversight Board (United
States), which require that we plan and perform the audits to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities at August 31, 2004 by
correspondence with the custodian and brokers, provide a reasonable basis for
our opinion.
PricewaterhouseCoopers LLP
Boston, Massachusetts
October 18, 2004
213
UNAUDITED INFORMATION __________________________________________________________
COLUMBIA FUNDS
FEDERAL INCOME TAX INFORMATION
COLUMBIA COMMON STOCK FUND
For non-corporate shareholders 100.00%, or the maximum amount allowable under
the Jobs and Growth Tax Relief Reconciliation Act of 2003, of income earned by
the Fund for the period September 1, 2003 to August 31, 2004 may represent
qualified dividend income. Final information will be provided in your 2004
1099-Div Form.
100.00% of the ordinary income distributed by the Fund for the year ended August
31, 2004, qualifies for the corporate dividends received deduction.
COLUMBIA INTERNATIONAL STOCK FUND
Foreign taxes paid during the fiscal year ended August 31, 2004, amounting to
$2,221,173 ($0.05 per share) are expected to be passed through to shareholders
as 100.00% allowable foreign tax credits on Form 1099-DIV for the year ending
December 31, 2004.
Gross income derived from sources within foreign countries amounted to
$10,502,144 ($0.23 per share) for the fiscal year ended August 31, 2004.
For non-corporate shareholders 100.00%, or the maximum amount allowable under
the Jobs and Growth Tax Relief Reconciliation Act of 2003, of income earned by
the Fund for the period September 1, 2003 to August 31, 2004 may represent
qualified dividend income. Final information will be provided in your 2004
1099-Div Form.
COLUMBIA STRATEGIC INVESTOR FUND
For the fiscal year ended August 31, 2004, the Fund designates long-term capital
gains of $4,331,771.
For non-corporate shareholders 100.00%, or the maximum amount allowable under
the Jobs and Growth Tax Relief Reconciliation Act of 2003, of income earned by
the Fund for the period September 1, 2003 to August 31, 2004 may represent
qualified dividend income. Final information will be provided in your 2004
1099-Div Form.
100.00% of the ordinary income distributed by the Fund for the year ended August
31, 2004, qualifies for the corporate dividends received deduction.
COLUMBIA BALANCED FUND
For non-corporate shareholders 45.69%, or the maximum amount allowable under the
Jobs and Growth Tax Relief Reconciliation Act of 2003, of income earned by the
Fund for the period September 1, 2003 to August 31, 2004 may represent qualified
dividend income. Final information will be provided in your 2004 1099-Div Form.
45.50% of the ordinary income distributed by the Fund for the year ended August
31, 2004, qualifies for the corporate dividends received deduction.
214
________________________________________________________________________________
COLUMBIA FUNDS
COLUMBIA FIXED INCOME SECURITIES FUND
For the fiscal year ended August 31, 2004, the Fund designates long-term capital
gains of $3,120,677.
COLUMBIA NATIONAL MUNICIPAL BOND FUND
For the fiscal year ended August 31, 2004, the Fund designates long-term capital
gains of $178,349.
99.56% of the distributions from net investment income will be treated as exempt
income for federal income tax purposes.
COLUMBIA OREGON MUNICIPAL BOND FUND
For the fiscal year ended August 31, 2004, the Fund designates long-term capital
gains of $6,461,631.
100.00% of the distributions from net investment income will be treated as
exempt income for federal income tax purposes.
215
TRUSTEES _______________________________________________________________________
COLUMBIA FUNDS
The Trustees/Directors serve terms of indefinite duration. The names, addresses
and ages of the Trustees/Directors and officers of the Funds in the Columbia
Funds Complex, the year each was first elected or appointed to office, their
principal business occupations during at least the last five years, the number
of portfolios overseen by each Trustee/Director and other directorships they
hold are shown below. Each officer listed below serves as an officer of each
Fund in the Columbia Funds Complex.
NAME, ADDRESS AND AGE, POSITION WITH FUNDS, PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS, NUMBER OF PORTFOLIOS IN COLUMBIA
YEAR FIRST ELECTED OR APPOINTED TO OFFICE (1) FUNDS COMPLEX OVERSEEN BY TRUSTEE/DIRECTOR, OTHER DIRECTORSHIPS HELD
DISINTERESTED TRUSTEES
DOUGLAS A. HACKER (Age 48) Executive Vice President - Strategy of United Airlines (airline) since December
P.O. Box 66100 2002 (formerly President of UAL Loyalty Services (airline) from September 2001
Chicago, IL 60666 to December 2002; Executive Vice President and Chief Financial Officer of United
Trustee (since 1996) Airlines from March 1999 to September 2001; Senior Vice President - Finance from
March 1993 to July 1999). Oversees 118, Orbitz, Inc. (on-line travel company)
--------------------------------------------------------------------------------
JANET LANGFORD KELLY (Age 46) Adjunct Professor of Law, Northwestern University since September 2004, Private
9534 W. Gull Lake Drive Investor since March 2004 (formerly Chief Administrative Officer and Senior Vice
Richland, MI 49083-8530 President, Kmart Holding Corporation (consumer goods), from September 2003 to
Trustee (since 1996) March 2004; Executive Vice President - Corporate -Development and
Administration, General Counsel and Secretary, Kellogg Company (food
manufacturer), from September 1999 to August 2003; Senior Vice President,
Secretary and General Counsel, Sara Lee Corporation (branded, packaged,
consumer-products manufacturer) from January, 1995 to September 1999). Oversees
118, None
--------------------------------------------------------------------------------
RICHARD W. LOWRY (Age 68) Private Investor since August 1987 (formerly Chairman and Chief Executive
10701 Charleston Drive Officer, U.S. Plywood Corporation (building products manufacturer)). Oversees
Vero Beach, FL 32963 120 3, None
Trustee (since 1995)
--------------------------------------------------------------------------------
CHARLES R. NELSON (Age 62) Professor of Economics, University of Washington, since January 1976; Ford and
Department of Economics Louisa Van Voorhis Professor of Political Economy, University of Washington,
University of Washington since September, 1993 (formerly Director, Institute for Economic Research,
Seattle, WA 98195 University of Washington from September 2001 to June 2003) Adjunct Professor of
Trustee (since 1981) Statistics, University of Washington, since September 1980; Associate Editor,
Journal of Money Credit and Banking, since September 1993; consultant
on econometric and statistical matters. Oversees 118, None
--------------------------------------------------------------------------------
JOHN J. NEUHAUSER (Age 61) Academic Vice President and Dean of Faculties since August 1999, Boston College
84 College Road (formerly Dean, Boston College School of Management from September 1977 to
Chestnut Hill, MA 02467-3838 September 1999). Oversees 121 3,4, Saucony, Inc. (athletic footwear)
Trustee (since 1985)
--------------------------------------------------------------------------------
PATRICK J. SIMPSON (Age 60) Partner, Perkins Coie L.L.P. (law firm). Oversees 118, None
1120 N.W. Couch Street
Tenth Floor
Portland, OR 97209-4128
Trustee (since 2000)
--------------------------------------------------------------------------------
(1) In December 2000, the boards of each of the former Liberty Funds and former
Stein Roe Funds were combined into one board of trustees responsible for
the oversight of both fund groups (collectively, the "Liberty Board").
In October 2003, the trustees on the Liberty Board were elected to the
boards of the Columbia Funds (the "Columbia Board") and of the CMG Fund Trust
(the "CMG Funds Board"); simultaneous with that election, Patrick J. Simpson
and Richard L. Woolworth, who had been directors on the Columbia Board and
trustees on the CMG Funds Board, were appointed to serve as trustees of the
Liberty Board. The date shown is the earliest date on which a trustee/director
was elected or appointed to the board of a Fund in the Columbia Funds Complex.
216
________________________________________________________________________________
COLUMBIA FUNDS
NAME, ADDRESS AND AGE, POSITION WITH FUNDS, PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS, NUMBER OF PORTFOLIOS IN
YEAR FIRST ELECTED OR APPOINTED TO OFFICE (1) COLUMBIA FUNDS COMPLEX OVERSEEN BY TRUSTEE/DIRECTOR, OTHER DIRECTORSHIPS HELD
DISINTERESTED TRUSTEES
THOMAS E. STITZEL (Age 68) Business Consultant since 1999 (formerly Professor of Finance from
2208 Tawny Woods Place 1975 to 1999, College of Business, Boise State University); Chartered
Boise, ID 83706 Financial Analyst. Oversees 118, None.
Trustee (since 1998)
--------------------------------------------------------------------------------
THOMAS C. THEOBALD (Age 67) Partner and Senior Advisor, Chicago Growth Partners (private equity
303 W. Madison investing) since September 2004 (formerly Managing Director,
Suite 2500 William Blair Capital Partners (private equity investing) from September
Chicago, IL 60606 1994 to September 2004). Oversees 118, Anixter International (network
Trustee and Chairman of the Board 5 support equipment distributor); Ventas, Inc. (real estate investment
(since 1996) trust); Jones Lang LaSalle (real estate management services) and MONY
Group (life insurance)
--------------------------------------------------------------------------------
ANNE-LEE VERVILLE (Age 59) Retired since 1997 (formerly General Manager, Global Education
359 Stickney Hill Road Industry, IBM Corporation (computer and technology) from 1994
Hopkinton, NH 03229 to 1997). Oversees 119 4, Chairman of the Board of Directors, Enesco Group,
Trustee (since 1998) Inc. (designer, importer and distributor of giftware and collectibles)
--------------------------------------------------------------------------------
RICHARD L. WOOLWORTH (Age 63) Retired since December 2003 (formerly Chairman and Chief
100 S.W. Market Street #1500 Executive Officer, The Regence Group (regional health insurer);
Portland, OR 97207 Chairman and Chief Executive Officer, BlueCross BlueShield of
Trustee (since 1991) Oregon; Certified Public Accountant, Arthur Young & Company).
Oversees 118, Northwest Natural Gas Co. (natural gas service provider)
--------------------------------------------------------------------------------
INTERESTED TRUSTEE
WILLIAM E. MAYER 2 (Age 64) Managing Partner, Park Avenue Equity Partners (private equity)
399 Park Avenue since February 1999 (formerly Founding Partner, Development
Suite 3204 Capital LLC from November 1996 to February 1999). Oversees
New York, NY 10022 120 3, Lee Enterprises (print media), WR Hambrecht + Co.
Trustee (since 1994) (financial service provider); First Health (healthcare); Reader's Digest
(publishing); OPENFIELD Solutions (retail industry technology provider)
--------------------------------------------------------------------------------
(2) Mr. Mayer is an "interested person" (as defined in the Investment Company Act
of 1940 (1940 Act)) by reason of his affiliation with WR Hambrecht + Co.
(3) Messrs. Lowry, Neuhauser and Mayer also serve as directors/trustees of the
Liberty All-Star Funds, currently consisting of 2 funds, which are advised by
an affiliate of the Advisor.
(4) Mr. Neuhauser and Ms. Verville also serve as disinterested directors of
Columbia Management Multi-Strategy Hedge Fund, LLC, which is advised by
the Advisor.
(5) Mr. Theobald was appointed as Chairman of the Board effective December 10,
2003.
217
OFFICERS _______________________________________________________________________
COLUMBIA FUNDS
NAME, ADDRESS AND AGE, POSITION WITH COLUMBIA
FUNDS, YEAR FIRST ELECTED OR APPOINTED TO OFFICE PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS
CHRISTOPHER L. WILSON (Age 47) President of the Columbia Funds since October 2004 (formerly President and
One Financial Center Chief Executive Officer, CDC IXIS Asset Management Services, Inc. from
Boston, MA 02111 September, 1998 to August 2004).
President (since 2004)
--------------------------------------------------------------------------------
J. KEVIN CONNAUGHTON (Age 40) Treasurer of the Columbia Funds and of the Liberty All-Star Funds since
One Financial Center December 2000; Vice President of the Advisor since April 2003 (formerly
Boston, MA 02111 President of the Columbia Funds from February 2004 to October 2004; Chief
Treasurer (since 2000) Accounting Officer and Controller of the Liberty Funds an Funds from February
1998 to October 2000); Treasurer of the Galaxy Funds since September 2002;
Treasurer, Columbia Management Multi-Strategy Hedge Fund, LLC since December
2002 (formerly Vice President of Colonial Management Associates, Inc. from
February 1998 to October, 2000).
--------------------------------------------------------------------------------
MARY JOAN HOENE (Age 54) Senior Vice President and Chief Compliance Officer of the Columbia Funds since
40 West 57th Street August 2004; Chief Compliance Officer of the Liberty All-Star Funds since
New York, NY 10019 August 2004 (formerly Partner, Carter, Ledyard & Milburn LLP from January 2001
Senior Vice President and to August, 2004; Counsel, Carter, Ledyard & Milburn LLP from November 1999 to
Chief Compliance Officer December 2000; Vice President and Counsel, Equitable Life Assurance Society of
(since 2004) the United States from April 1998 to November 1999).
--------------------------------------------------------------------------------
MICHAEL G. CLARKE (Age 34) Chief Accounting Officer of the Columbia Funds and of the Liberty All-Star
One Financial Center Funds since October 2004 (formerly Controller of the Columbia Funds and of the
Boston, MA 02111 Liberty All-Star Funds from May 2004 to October 2004; Assistant Treasurer from
Chief Accounting Officer June 2002 to May 2004; Vice President, Product Strategy & Development of the
(since 2004) Liberty Funds Group from February 2001 to June 2002; Assistant Treasurer of the
Liberty Funds and -of the Liberty All-Star Funds from August 1999 to February,
2001; Audit Manager, Deloitte & Toche LLP from May 1997 to August 1999).
--------------------------------------------------------------------------------
JEFFREY R. COLEMAN (Age 34) Controller of the Columbia Funds and of the Liberty All-Star Funds since
One Financial Center October 2004 (formerly Vice President of CDC IXIS Asset Management Services,
Boston, MA 02111 Inc. and Deputy Treasurer of the CDC Nvest Funds and Loomis Sayles Funds from
Controller (since 2004) February 2003 to September 2004; Assistant Vice President of CDC IXIS -Asset
Management Services, Inc. and Assistant Treasurer of the CDC Nvest Funds from
August 2000 to February 2003; Tax Manager of PFPC, Inc. from November 1996 to
August 2000).
--------------------------------------------------------------------------------
DAVID A. ROZENSON (Age 50) Secretary of the Columbia Funds and of the Liberty All-Star Funds since
One Financial Center December 2003; Senior Counsel, Bank of America Corporation (formerly
Boston, MA 02111 FleetBoston Financial Corporation) since January 1996; Associate General
Secretary (since 2003) Counsel, Columbia Management Group since November 2002.
--------------------------------------------------------------------------------
218
COLUMBIA FUNDS _________________________________________________________________
COLUMBIA FUNDS
----------------------------------------------------
LARGE GROWTH Columbia Common Stock
Columbia Growth
Columbia Growth Stock
Columbia Large Cap Growth
Columbia Tax-Managed Growth
Columbia Tax-Managed Growth II
Columbia Young Investor
----------------------------------------------------
LARGE VALUE Columbia Disciplined Value
Columbia Growth & Income
Columbia Large Cap Core
Columbia Tax-Managed Value
----------------------------------------------------
MIDCAP GROWTH Columbia Acorn Select
Columbia Mid Cap Growth
Columbia Tax-Managed Aggressive Growth
----------------------------------------------------
MIDCAP VALUE Columbia Dividend Income
Columbia Mid Cap
Columbia Strategic Investor
----------------------------------------------------
SMALL GROWTH Columbia Acorn
Columbia Acorn USA
Columbia Small Company Equity
----------------------------------------------------
SMALL VALUE Columbia Small Cap
Columbia Small Cap Value
----------------------------------------------------
BALANCED Columbia Asset Allocation
Columbia Balanced
Columbia Liberty Fund
----------------------------------------------------
SPECIALTY Columbia Real Estate Equity
Columbia Technology
Columbia Utilities
----------------------------------------------------
TAXABLE FIXED-INCOME Columbia Contrarian Income
Columbia Corporate Bond
Columbia Federal Securities
Columbia Fixed Income Securities
Columbia High Yield
Columbia High Yield Opportunities
Columbia Income
Columbia Intermediate Bond
Columbia Intermediate Government Income
Columbia Quality Plus Bond
Columbia Short Term Bond
Columbia Strategic Income
----------------------------------------------------
TAX EXEMPT Columbia High Yield Municipal
Columbia Intermediate Tax-Exempt Bond
Columbia Managed Municipals
Columbia National Municipal Bond
Columbia Tax-Exempt
Columbia Tax-Exempt Insured
219
________________________________________________________________________________
COLUMBIA FUNDS
----------------------------------------------------
SINGLE STATE TAX EXEMPT Columbia California Tax-Exempt
Columbia Connecticut Intermediate Municipal Bond
Columbia Connecticut Tax-Exempt
Columbia Florida Intermediate Municipal Bond
Columbia Massachusetts Intermediate Municipal Bond
Columbia Massachusetts Tax-Exempt
Columbia New Jersey Intermediate Municipal Bond
Columbia New York Intermediate Municipal Bond
Columbia New York Tax-Exempt
Columbia Oregon Municipal Bond
Columbia Pennsylvania Intermediate Municipal Bond
Columbia Rhode Island Intermediate Municipal Bond
----------------------------------------------------
MONEY MARKET Columbia Money Market
Columbia Municipal Money Market
----------------------------------------------------
INTERNATIONAL/GLOBAL Columbia Acorn International
Columbia Acorn International Select
Columbia Europe
Columbia Global Equity
Columbia International Equity
Columbia International Stock
Columbia Newport Asia Pacific
Columbia Newport Greater China
Columbia Newport Tiger
----------------------------------------------------
INDEX Columbia Large Company Index
Columbia Small Company Index
Columbia U.S. Treasury Index
Please consider the investment objectives, risks,
charges and expenses of a mutual fund carefully
before investing. Contact us at 800-345-6611 for a
prospectus which contains this and other important
information about the fund. Read it carefully
before you invest.
For complete product information on any Columbia
fund, visit our website at www.columbiafunds.com.
Columbia Management Group and Columbia Management
refer collectively to the various investment
advisory subsidiaries of Columbia Management
Group, including Columbia Management Advisors,
Inc., the registered investment advisor, and
Columbia Funds Distributor, Inc.
220
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IMPORTANT INFORMATION ABOUT THIS REPORT ________________________________________
COLUMBIA FUNDS
TRANSFER AGENT
Columbia Funds Services, Inc.
P.O. Box 8081
Boston MA 02266-8081
800.345.6611
DISTRIBUTOR
Columbia Funds Distributor, Inc.
One Financial Center
Boston MA 02111
INVESTMENT ADVISOR
Columbia Management Advisors, Inc.
100 Federal Street
Boston MA 02110
INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
PricewaterhouseCoopers LLP
125 High Street
Boston MA 02110
The funds mail one shareholder report to each shareholder address. If you would
like more than one report, please call shareholder services at 800-345-6611 and
additional reports will be sent to you.
This report has been prepared for shareholders of Columbia Funds. This report
may also be used as sales literature when preceded or accompanied by the current
prospectus which provides details of sales charges, investment objectives and
operating policies of the funds and with the most recent copy of the Columbia
Funds Performance Update.
A description of the policies and procedures that the fund uses to determine how
to vote proxies relating to their portfolio securities and a copy of the fund's
voting record are available (i) at www.columbiamanagement.com; (ii) on the
Securities and Exchange Commission's website at www.sec.gov and (iii) without
charge, upon request, by calling 800-368-0346.
225
[Image of eDelivery]
Help your fund reduce printing and postage costs! Elect to get your shareholder
reports by electronic delivery. With Columbia's eDelivery program, you receive
an e-mail message when your shareholder report becomes available online. If your
fund account is registered with Columbia Funds, you can sign up quickly and
easily on our website at www.columbiafunds.com.
Please note -- if you own your fund shares through a financial institution,
contact the institution to see if it offers electronic delivery. If you own your
fund shares through a retirement plan, electronic delivery may not be available
to you.
Columbia Funds Annual Report, August 31, 2004
[EAGLE HEAD LOGO] COLUMBIA FUNDS
A MEMBER OF COLUMBIA MANAGEMENT GROUP
(C)2004 COLUMBIA FUNDS DISTRIBUTOR, INC.
ONE FINANCIAL CENTER, BOSTON, MA 02111-2621
800.426.3750 WWW.COLUMBIAFUNDS.COM
COL-02/778S-0904 (10/04) 04/2927
ITEM 2. CODE OF ETHICS.
(a) The registrant has, as of the end of the period covered by this
report, adopted a code of ethics that applies to the registrant's
principal executive officer, principal financial officer, principal
accounting officer or controller, or persons performing similar
functions, regardless of whether these individuals are employed by the
registrant or a third party.
(b) During the period covered by this report, there were not any
amendments to a provision of the code of ethics adopted in 2(a) above.
(c) During the period covered by this report, there were not any waivers
or implicit waivers to a provision of the code of ethics adopted in
2(a) above.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
The registrant's Board of Trustees has determined that Douglas A. Hacker, Thomas
E. Stitzel, Anne-Lee Verville and Richard L. Woolworth, each of whom are members
of the registrant's Board of Trustees and Audit Committee, each qualify as an
audit committee financial expert. Mr. Hacker, Mr. Stitzel, Ms. Verville and Mr.
Woolworth are each independent trustees, as defined in paragraph (a)(2) of this
item's instructions and collectively constitute the entire Audit Committee.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) Aggregate Audit Fees billed by the principal accountant for professional
services rendered during the fiscal years ended August 31, 2004 and August 31,
2003 are approximately as follows:
2004 2003
$30,700 $27,300
Audit Fees include amounts related to the audit of the registrant's annual
financial statements or services that are normally provided by the accountant in
connection with statutory and regulatory filings or engagements for those fiscal
years. Note that fiscal year 2004 includes the review of a non-routine
regulatory filing.
(b) Aggregate Audit-Related Fees billed by the principal accountant for
professional services rendered during the fiscal years ended August 31, 2004 and
August 31, 2003 are approximately as follows:
2004 2003
$3,500 $3,500
Audit-Related Fees include amounts for assurance and related services by the
principal accountant that are reasonably related to the performance of the audit
of the registrant's financial statements and are not reported in Audit Fees
above. In both fiscal years 2004 and 2003, Audit-Related Fees include certain
agreed-upon procedures performed for semi-annual shareholder reports.
The "de minimis" exception under paragraph (c)(7)(i)(C) of Rule 2-01 of
Regulation S-X became effective on May 6, 2003. For the registrant, the
percentage of Audit-Related services that were approved under the "de minimis"
exception during the fiscal years ended August 31, 2004 and August 31, 2003 was
zero.
The pre-approval requirements for services to the investment adviser (not
including any sub-adviser whose role is primarily portfolio management and is
subcontracted with or overseen by another investment adviser) and any entity
controlling, controlled by, or under common control with the adviser that
provides ongoing services to the registrant under paragraph (c)(7)(ii) of Rule
2-01 of Regulation S-X became effective on May 6, 2003. During the fiscal years
ended August 31, 2004 and August 31, 2003, there were no Audit-Related Fees that
were approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X.
The percentage of Audit-Related fees required to be approved under paragraph
(c)(7)(ii) of Rule 2-01 of Regulation S-X that were approved under the "de
minimis" exception during the fiscal years ended August 31, 2004 and August 31,
2003 was zero.
(c) Aggregate Tax Fees billed by the principal accountant for professional
services rendered during the fiscal years ended August 31, 2004 and August 31,
2003 are approximately as follows:
2004 2003
$2,700 $1,900
Tax Fees include amounts for professional services by the principal accountant
for tax compliance, tax advice and tax planning. Tax Fees in both fiscal years
2004 and 2003 primarily consist of the review of annual tax returns.
The "de minimis" exception under paragraph (c)(7)(i)(C) of Rule 2-01 of
Regulation S-X became effective on May 6, 2003. For the registrant, the
percentage of Tax Fees that were approved under the "de minimis" exception
during the fiscal years ended August 31, 2004 and August 31, 2003 was zero.
The pre-approval requirements for services to the investment adviser (not
including any sub-adviser whose role is primarily portfolio management and is
subcontracted with or overseen by another investment adviser) and any entity
controlling, controlled by, or under common control with the adviser that
provides ongoing services to the registrant under paragraph (c)(7)(ii) of Rule
2-01 of Regulation S-X became effective on May 6, 2003. During the fiscal years
ended August 31, 2004 and August 31, 2003, there were no Tax Fees that were
approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X.
The percentage of Tax fees required to be approved under paragraph (c)(7)(ii) of
Rule 2-01 of Regulation S-X that were approved under the "de minimis" exception
during the fiscal years ended August 31, 2004 and August 31, 2003 was zero.
(d) Aggregate All Other Fees billed by the principal accountant for professional
services rendered during the fiscal years ended August 31, 2004 and August 31,
2003 are as follows:
2004 2003
$0 $0
All Other Fees include amounts for products and services provided by the
principal accountant, other than the services reported in (a)-(c) above.
The "de minimis" exception under paragraph (c)(7)(i)(C) of Rule 2-01 of
Regulation S-X became effective on May 6, 2003. For the registrant, the
percentage of All Other Fees that were approved under the "de minimis" exception
during the fiscal years ended August 31, 2004 and August 31, 2003 was zero.
The pre-approval requirements for services to the investment adviser (not
including any sub-adviser whose role is primarily portfolio management and is
subcontracted with or overseen by another investment adviser) and any entity
controlling, controlled by, or under common control with the adviser that
provides ongoing services to the registrant under paragraph (c)(7)(ii) of Rule
2-01 of Regulation S-X became effective on May 6, 2003. During the fiscal year
ended August 31, 2004, All Other Fees that were approved pursuant to paragraph
(c)(7)(ii) of Rule 2-01 of Regulation S-X were approximately $95,000. During the
fiscal year ended August 31, 2003, All Other Fees that would have been subject
to pre-approval had paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X been
applicable at the time the services were provided, were approximately $95,000.
For both fiscal years, All Other Fees relate to internal controls reviews of the
registrant's transfer agent.
The percentage of All Other Fees required to be approved under paragraph
(c)(7)(ii) of Rule 2-01 of Regulation S-X that were approved under the "de
minimis" exception during the fiscal years ended August 31, 2004 and August 31,
2003 was zero.
(e)(1) AUDIT COMMITTEE PRE-APPROVAL POLICIES AND PROCEDURES
I. GENERAL OVERVIEW
The Audit Committee of the registrant has adopted a formal policy (the "Policy")
which sets forth the procedures and the conditions pursuant to which the Audit
Committee will pre-approve (i) all audit and non-audit (including audit related,
tax and all other) services provided by the registrant's independent auditor to
the registrant and individual funds (collectively "Fund Services"), and (ii) all
non-audit services provided by the registrant's independent auditor to the
funds' adviser or a control affiliate of the adviser, that relate directly to
the funds' operations and financial reporting (collectively "Fund-related
Adviser Services"). A "control affiliate" is an entity controlling, controlled
by, or under common control with the adviser that provides ongoing services to
the funds, and the term "adviser" is deemed to exclude any unaffiliated
sub-adviser whose role is primarily portfolio management and is sub-contracted
or overseen by another investment adviser. The adviser and control affiliates
are collectively referred to as "Adviser Entities."
The Audit Committee uses a combination of specific (on a case-by-case basis as
potential services are contemplated) and general (pre-determined list of
permitted services) pre-approvals. Unless a type of service has received general
pre-approval, it will require specific pre-approval by the Audit Committee if it
is to be provided by the independent auditor.
The Policy does not delegate the Audit Committee's responsibilities to
pre-approve services performed by the independent auditor to management.
II. GENERAL PROCEDURES
On an annual basis, the Fund Treasurer and/or Director of Trustee Administration
shall submit to the Audit Committee a schedule of the types of Fund Services and
Fund-related Adviser Services that are subject to general pre-approval.
These schedules will provide a description of each type of service that is
subject to general pre-approval and, where possible, will provide estimated fees
for each instance of providing each service. This general pre-approval and
related fees (where provided) will generally cover a one-year period (for
example, from July 1 through August 31 of the following year). The Audit
Committee will review and approve the types of services and review the projected
fees for the next one-year period and may add to, or subtract from, the list of
general pre-approved services from time to time, based on subsequent
determinations. This approval acknowledges that the Audit Committee is in
agreement with the specific types of services that the independent auditor will
be permitted to perform. The fee amounts will be updated to the extent necessary
at other regularly scheduled meetings of the Audit Committee.
In addition to the fees for each individual service, the Audit Committee has the
authority to implement a fee cap on the aggregate amount of non-audit services
provided to an individual fund.
If, subsequent to general pre-approval, a fund, its investment adviser or a
control affiliate determines that it would like to engage the independent
auditor to perform a service that requires pre-approval and that is not included
in the general pre-approval list, the specific pre-approval procedure shall be
as follows:
o A brief written request shall be prepared by management detailing the
proposed engagement with explanation as to why the work is proposed to
be performed by the independent auditor;
o The request should be addressed to the Audit Committee with copies to
the Fund Treasurer and/or Director of Trustee Administration;
o The Fund Treasurer and/or Director of Trustee Administration will
arrange for a discussion of the service to be included on the agenda
for the next regularly scheduled Audit Committee meeting, when the
Committee will discuss the proposed engagement and approve or deny the
request.
o If the timing of the project is critical and the project needs to
commence before the next regularly scheduled meeting, the Chairperson
of the Audit Committee may approve or deny the request on behalf of
the Audit Committee, or, in the Chairperson's discretion, determine to
call a special meeting of the Audit Committee for the purpose of
considering the proposal. Should the Chairperson of the Audit
Committee be unavailable, any other member of the Audit Committee may
serve as an alternate for the purpose of approving or denying the
request. Discussion with the Chairperson (or alternate, if necessary)
will be arranged by the Fund Treasurer and/or Director of Trustee
Administration. The independent auditor will not commence any such
project unless and until specific approval has been given.
III. CERTAIN OTHER SERVICES PROVIDED TO ADVISER ENTITIES
The Audit Committee recognizes that there are cases where services proposed to
be provided by the independent auditor to the adviser or control affiliates are
not Fund-related Adviser Services within the meaning of the Policy, but
nonetheless may be relevant to the Audit Committee's ongoing evaluation of the
auditor's independence and objectivity with respect to its audit services to the
funds. As a result, in all cases where an Adviser Entity engages the independent
auditor to provide audit or non-audit services that are not Fund Services or
Fund-related Adviser Services, were not subject to pre-approval by the Audit
Committee, and the projected fees for any such engagement (or the aggregate of
all such engagements during the period covered by the Policy) exceeds a
pre-determined threshold established by the Audit Committee; the independent
auditor, Fund Treasurer and/or Director of Trustee Administration will notify
the Audit Committee not later than its next meeting. Such notification shall
include a general description of the services provided, the entity that is to be
the recipient of such services, the timing of the engagement, the entity's
reasons for selecting the independent auditor,
and the projected fees. Such information will allow the Audit Committee to
consider whether non-audit services provided to the adviser and Adviser
Entities, which were not subject to Audit Committee pre-approval, are compatible
with maintaining the auditor's independence with respect to the Funds.
IV. REPORTING TO THE AUDIT COMMITTEE
The Fund Treasurer or Director of Trustee Administration shall report to the
Audit Committee at each of its regular meetings regarding all Fund Services or
Fund-related Adviser Services initiated since the last such report was rendered,
including:
o A general description of the services, and
o Actual billed and projected fees, and
o The means by which such Fund Services or Fund-related Adviser Services
were pre-approved by the Audit Committee.
In addition, the independent auditor shall report to the Audit Committee
annually, and no more than 90 days prior to the filing of audit reports with the
SEC, all non-audit services provided to entities in the funds' "investment
company complex," as defined by SEC rules, that did not require pre-approval
under the Policy.
V. AMENDMENTS; ANNUAL APPROVAL BY AUDIT COMMITTEE
The Policy may be amended from time to time by the Audit Committee. Prompt
notice of any amendments will be provided to the independent auditor, Fund
Treasurer and Director of Trustee Administration. The Policy shall be reviewed
and approved at least annually by the Audit Committee.
*****
(e)(2) This information has been included in items (b)-(d) above.
(f) Not applicable.
(g) All non-audit fees billed by the registrant's accountant for services
rendered to the registrant for the fiscal years ended August 31, 2004 and August
31, 2003 are disclosed in (b)-(d) above.
All non-audit fees billed by the registrant's accountant for services rendered
to the registrant's investment adviser (not including any sub-adviser whose role
is primarily portfolio management and is subcontracted with or overseen by
another investment adviser) and any entity controlling, controlled by, or under
common control with the adviser that provides ongoing services to the registrant
for the fiscal years ended August 31, 2004 and August 31, 2003 are also
disclosed in (b)-(d) above. Such fees were approximately $95,000 and $95,000,
respectively.
(h) The registrant's Audit Committee of the Board of Directors has considered
whether the provision of non-audit services that were rendered to the
registrant's adviser (not including any sub-adviser whose role is primarily
portfolio management and is subcontracted with or overseen by another investment
adviser), and any entity controlling, controlled by, or under common control
with the investment adviser that provides ongoing services to the registrant
that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of
Regulation S-X, is compatible with maintaining the principal accountant's
independence. The Audit Committee determined that the provision of such services
is compatible with maintaining the principal accountant's independence.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. SCHEDULE OF INVESTMENTS
The registrant's "Schedule I - Investments in securities of unaffiliated
issuers" (as set forth in 17 CFR 210.12-12) is included in Item 1 of this Form
N-CSR.
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.
There have not been any material changes to the procedures by which shareholders
may recommend nominees to the registrant's board of directors, since those
procedures were last disclosed in response to the requirements of Item
7(d)(2)(ii)(G) of Schedule 14A or this Item.
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
attached hereto as Exhibit 99.CODE ETH.
(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 Balanced Fund, Inc.
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By (Signature and Title) /s/ Christopher L. Wilson
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Christopher L. Wilson, President
Date October 28, 2004
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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/ Christopher L. Wilson
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Christopher L. Wilson, President
Date October 28, 2004
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By (Signature and Title) /s/ J. Kevin Connaughton
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J. Kevin Connaughton, Treasurer
Date October 28, 2004
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