UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM N-CSR
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CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
INVESTMENT COMPANY ACT FILE NUMBER 811-07923
CNI CHARTER FUNDS
(Exact name of registrant as specified in charter)
--------
400 North Roxbury Drive
Beverly Hills, CA 90210
(Address of principal executive offices) (Zip code)
SEI Investments Distributors
1 Freedom Valley Drive
Oaks, PA 19456
(Name and address of agent for service)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: 1-888-889-0799
DATE OF FISCAL YEAR END: SEPTEMBER 30, 2007
DATE OF REPORTING PERIOD: MARCH 31, 2007
ITEM 1. REPORTS TO STOCKHOLDERS.
[AHA Logo Omitted]
a tobacco-free investment [CNI Logo Omitted]
[Bldg graphic omitted]
AHA Investment Funds
Series of CNI Charter Funds
Semi-Annual Report o March 31, 2007
- --------------------------------------------------------------------------------
AHA Limited Maturity Fixed Income Fund
AHA Full Maturity Fixed Income Fund
AHA Balanced Fund
AHA Diversified Equity Fund www.ahafunds.org
AHA Socially Responsible Equity Fund www.cnicharterfunds.com
<page>
TABLE OF CONTENTS
AHA Investment Funds Semi-Annual Report
Series of CNI Charter Funds
2 Letter to Our Shareholders
5 Schedules of Investments
29 Statements of Assets and Liabilities
30 Statements of Operations
32 Statements of Changes in Net Assets
34 Financial Highlights
36 Notes to Financial Statements
43 Disclosure of Fund Expenses
44 Approval of Sub-Advisory Agreement
================================================================================
AVAILABILITY OF PROXY VOTING INFORMATION
A description of the policies and procedures that the Funds use to determine how
to vote proxies related to the Funds' portfolio securities, and information on
how the Funds voted proxies relating to portfolio securities during the most
recent 12-month period ending June 30 is available (1) without charge, upon
request by calling 1-800-445-1341, (2) on the CNI Charter Funds' website at
WWW.CNICHARTERFUNDS.COM, and (3) on the Securities and Exchange Commission's
website at www.sec.gov.
AVAILABILITY OF QUARTERLY PORTFOLIO SCHEDULE
The Funds file their complete schedule of portfolio holdings with the Securities
and Exchange Commission for the first and third quarters of each fiscal year on
Form N-Q within sixty days after the end of the period. The Funds' Form N-Q is
available on the Commission's website at HTTP://WWW.SEC.GOV and may be reviewed
and copied at the Commission's Public Reference Room in Washington, DC.
Information on the operation of the Public Reference Room may be obtained by
calling 1-800-SEC-0330. The most current Form N-Q is also available on the CNI
Charter Funds' website at www. cnicharterfunds.com and without charge, upon
request by calling 1-800-445-1341.
AHA INVESTMENT FUNDS | PAGE 1
letter to our shareholders
MARCH 31, 2007
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Dear Shareholder:
Please find below a review of the first half of the fiscal year for the AHA
Investment Funds.
AHA LIMITED MATURITY FIXED INCOME FUND
Six months into our new fiscal year has been a time of transition for our fixed
income managers since the Federal Reserve Bank is not increasing rates. The
inversion in the yield curve between two year maturity and ten year securities
has given way to a more normal positive slope with longer maturities earning
higher yields. However, the inversion of yields for fixed income securities
shorter than two years continues still as shorter securities are yielding at a
higher rate than longer term maturities. The two managers of the AHA Limited
Maturity Fund diversify by investing roughly on opposite sides of this
inversion. Patterson Capital Corporation manages in the 1-3 year maturity range
whereas CNAM (City National Asset Management, Inc.) invests in the 1-5 year
spectrum.
Over the past six months ending March 31, 2007, Institutional Class shares of
the AHA Limited Maturity Fund produced a total return, net of fees, of 2.36% vs.
2.46% for an equal weighted blend of the Merrill Lynch 1-3 Year Treasury Index
and the 1-5 year Lehman Government/Credit Index. These two indices returned
2.33% and 2.52% respectively for the half year. The Merrill Lynch 3-Month U.S.
Treasury Bill
[Line Graph Omitted] Plot points are as follows:
3/31/07 12/31/06 9/30/06
3M 5.04% 5.02% 4.89%
6M 5.06 5.09 5.02
1 Yr 4.9 5 4.91
2 Yr 4.58 4.82 4.71
3 Yr 4.54 4.74 4.62
4.54 4.72 4.6
5 Yr 4.54 4.7 4.59
4.58 4.7 4.6
10 Yr 4.65 4.71 4.64
4.78 4.81 4.7
4.92 4.91 4.77
4.88 4.86 4.84
25Y+ 4.84 4.81 4.76
Index returned 2.52% over the six months which still saw the inversion in the
yield curve for periods under two years as shown on the yield chart shown below,
plotting the movement of the curve at the beginning, (09/30/06), middle
(12/31/06) and end of the six month period (03/31/07).
The Fund's overall duration included upward movement over the period to 2.3
years at March 31st as CNAM extended its portfolio maturity to 3.0 years in
anticipation of the yield curve steepening in the 3-5 year segment of the
maturity spectrum. This was beneficial to the Fund's performance. The Fund's
sector distribution favored mortgage obligations and corporate bonds which aided
performance over Treasuries and agencies. With the revised January 31, 2007
prospectus, the Fund's managers were allowed to add Baa/BBB (Investment Grade)
bonds to their portfolios of single A or higher. This was to increase their
ability to diversify among corporate issues of investment grade which represents
31.7% of the U.S. corporate investment grade bond market at this time. At the
end of March, both sub-advisors had no purchases of Baa/BBB rated bonds and each
maintained A/AA+ average portfolio credit quality.
AHA FULL MATURITY FIXED INCOME
This Fund also combines two sub-advisors: a core bond manager, Baird Advisors,
with a mandate to follow a market neutral duration compared to the Lehman
Aggregate Index; and an alpha manager whose role is to move duration proactively
in comparison to the Lehman Intermediate Government/Credit Index. The objective
is to maintain a broadly-invested core bond portfolio and seek additional return
through duration and interest rate tactical management.
During the six months ending March 31, 2007, Institutional Class shares of this
Fund achieved a net total return of 2.45% vs. 2.64% for the Lehman
AHA INVESTMENT FUNDS | PAGE 2
<page>
letter to our shareholders
MARCH 31, 2007
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Intermediate Bond Index and 2.75% for the Lehman Aggregate Bond Index.
Morningstar ranked this Fund in the upper 25th percentile of their Intermediate
Fixed Income peer universe for the period. The Fund accomplished this return by
overweighting corporate, mortgage and asset backed, dollar-issued bonds of
foreign entities, and under-weighting Treasury and to a lesser degree agency
issues. As an investment grade Fund with an average credit quality rating of AA,
the Fund's sub-advisors avoided any losses due to the sub-prime, lower grade
mortgage lenders. The Fund is structured to provide safety through high quality
investment grade holdings.
AHA BALANCED FUND
This Fund is what Morningstar labels a moderately balanced fund, with target
weightings of 60% large cap core stocks, 30% core bonds, and 10% cash. The Fund
during these six months was divided between two managers, Freeman Associates for
core equity and Baird Advisors for core bonds. During the first half of the
fiscal year it returned 4.79% compared to 5.51% for its blended index of 60% S&P
500, 30% Lehman Aggregate and 10% U.S. Treasury Bills. It ranked 77th in the
Morningstar universe amongst its peer group for the period. The approach of the
core equity manager, Freeman Associates, relies heavily upon quantitative models
emphasizing price-to-cash flow, price-to-earnings and price-to-sales ratios. It
also is diversified in all S&P 500 sectors within a narrow range of the sector
weightings of the index. Throughout the six month duration the stock market has
experienced a surge in stock prices which have a more speculative nature and are
outside of the risk levels allowed by the core philosophy, which caused an
underperformance versus the benchmark. The core bond manager, Baird Advisors,
with a mandate to follow a market neutral duration compared to the Lehman
Aggregate Index, maintains a broadly-invested core bond portfolio and seeks
additional return through sector weightings.
AHA DIVERSIFIED EQUITY FUND
At the beginning of the six month period, two additional sub-advisors, SKBA and
AMBS, joined the Fund with the objective of adding alpha (returns in excess of
the market) and further diversifying the Fund. The styles of these two managers,
each allotted a quarter of the Fund, complement the core manager, Freeman
Associates, which continues to advise the core of the Fund, as illustrated in
the pie chart.
[Pie Chart Omitted] Plot points are as follows:
Freeman - Core 50%
AMBS - Alpha Large Cap 25%
SKBA - Large Mid-Cap 25%
During the six month period under review, Institutional Class shares of this
Fund returned 6.79% vs. 7.38% for the S&P 500. It ranked in the 67th percentile
of the Morningstar universe. The approach of the core manager, Freeman
Associates, relies heavily upon quantitative models emphasizing price-to-cash
flow, price-to-earnings and price-to-sales ratios. The core half of the Fund is
diversified in all S&P 500 sectors within a narrow range of the sector
weightings of the index. Throughout the six month duration the stock market
experienced a surge in stock prices which have a more speculative nature and are
outside of the risk levels allowed by the core philosophy, which contributed to
an underperformance versus the benchmark.
SKBA, an alpha manager in the large/mid-capitalization range, began management
of 25% of the fund at the start of the fiscal year. SKBA was able to add to the
Fund's performance by diversification in middle and large capitalization
holdings in Telecommunications, Energy and Materials, sectors which performed
well in the half year.
AHA INVESTMENT FUNDS | PAGE 3
<page>
letter to our shareholders
MARCH 31, 2007
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AMBS, also an alpha manager, which commenced management of 25% of the Fund at
the start of the fiscal year, concentrates holdings in certain sectors. AMBS
held a zero percent weighting in the Utilities sector and therefore missed that
sector's good performance. They also had a heavy weighting in Financials and
Technology with underperformance in this period.
Both alpha managers are repositioning the Fund at this time toward highly
capitalized companies and late stock market cycle companies such as Industrials,
as we enter the second half of this fiscal year.
AHA SOCIALLY RESPONSIBLE
EQUITY FUND
This Fund is managed solely by SKBA, a manager with expertise in socially
conscious investing following a value oriented philosophy. For the half year,
Institutional Class shares of this Fund returned 8.86% net of fees, compared to
6.11% for the Domini 400 Social Index. The manager invests from a universe of
stocks which are screened for social values including pro-environmental, good
corporate governance and citizenship and follows the guidelines of the U.S.
Conference of Bishops. Starting with a universe of 400 stocks remaining after
social screening of the Russell Value Index, this Fund seeks to invest
responsibly both along fundamental stock valuation analysis and through social
concerns. The Fund is heavily weighted in Depository Institutions, Chemicals &
Allied Products and Electronic Equipment, all sectors which contributed to
better performance than the Index.
We at CCM Advisors, LLC, the investment advisor to the AHA Investment Funds,
series of the CNI Charter Funds, are grateful for your trust and are
continuously monitoring and evaluating the AHA Fund sub-advisors to maintain the
optimal combination of core and alpha portfolios.
Sincerely,
/s/ Timothy G. Solberg Omitted
Timothy G. Solberg, CFA
Chief Investment Officer
AHA Investment Funds, series of the
CNI Charter Funds
Past performance is not indicative of future results.
Opinions expressed above are subject to change, are not guaranteed, and should
not be considered a recommendation to buy or sell any security. Please refer to
the schedule of investments in the report for fund holdings and index
definitions. Portfolio holdings and sector allocations are subject to change.
The adviser has agreed to voluntarily waive fees to the extent necessary to keep
operating expenses at or below specific limits. In the absence of such waivers,
total returns would be reduced.
Investing in mutual funds involves risk, including possible loss of principal.
In additional to the normal risks associated with investing, investments in
smaller companies typically exhibit higher volatility, and products of companies
in which technology funds invest may be subject to severe competition and rapid
obsolescence. An investment in the Funds is not insured or guaranteed by the
Federal Deposit Insurance Corporation or any other government agency.
Changing interest rates can adversely affect the value of an investment in the
AHA Limited and Full Maturity Funds.
Distributed by SEI Investments Distribution Co. (SIDCo).
AHA INVESTMENT FUNDS | PAGE 4
schedule of investments
MARCH 31, 2007 (UNAUDITED)
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AHA Limited Maturity Fixed Income Fund
[Bar Chart Omitted]
Plot points are as follows:
SECTOR WEIGHTINGS*:
37.0% Corporate Bonds
24.8% U.S. Government Mortgage-Backed Obligations
23.9% U.S. Government Agency Obligations
7.0% U.S. Treasury Obligations
5.1% Mortgage-Backed Securities
1.1% Cash Equivalent
1.1% Asset-Backed Securities
*Percentages based on total investments.
- ---------------------------------------------------------------
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
CORPORATE BONDS [36.7%]
Aerospace & Defense [0.5%]
United Technologies
4.375%, 05/01/10 $ 200 $ 196
============================================================
BANKS [4.8%]
Bank of America
7.400%, 01/15/11 750 808
HSBC Holding
7.500%, 07/15/09 200 210
U.S. Bank, NA
6.375%, 08/01/11 750 785
Washington Mutual
4.375%, 01/15/08 250 248
------------------------------------------------------------
TOTAL BANKS 2,051
============================================================
BEAUTY PRODUCTS [1.8%]
Procter & Gamble
6.875%, 09/15/09 750 784
============================================================
CHEMICALS [0.6%]
Dow Chemical
5.750%, 12/15/08 250 252
============================================================
COMPUTER SYSTEM DESIGN & SERVICES [2.6%]
IBM
6.450%, 08/01/07 400 401
IBM, MTN4.
375%, 06/01/09 750 742
------------------------------------------------------------
TOTAL COMPUTER SYSTEM DESIGN & SERVICES 1,143
============================================================
FINANCE AUTO LOANS [0.7%]
Toyota MotorCredit
5.500%, 12/15/08 300 301
============================================================
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
FINANCIAL SERVICES [4.3%]
American Express Credit
3.000%, 05/16/08 $ 300 $ 293
International Lease Finance
4.350%, 09/15/08 300 297
John Deere Capital, Ser D, MTN
4.500%, 01/25/08 200 198
Lehman Brothers Holdings
6.625%, 01/18/12 750 792
National Rural Utilities
3.875%, 02/15/08 275 272
------------------------------------------------------------
TOTAL FINANCIAL SERVICES 1,852
============================================================
FOOD, BEVERAGE & TOBACCO [0.6%]
Coca-Cola Enterprises
5.750%, 11/01/08 250 252
============================================================
INSURANCE [0.5%]
Allstate
7.200%, 12/01/09 200 210
============================================================
INVESTMENT BANKER/BROKER DEALER [7.9%]
Citigroup
6.500%, 01/18/11 750 785
3.500%, 02/01/08 300 296
Credit Suisse First Boston
6.125%, 11/15/11 750 778
Goldman Sachs Group
6.650%, 05/15/09 750 773
Morgan Stanley
6.750%, 04/15/11 750 793
------------------------------------------------------------
TOTAL INVESTMENT BANKER/BROKER DEALER 3,425
============================================================
MULTI-MEDIA [1.8%]
Walt Disney
6.375%, 03/01/12 750 792
============================================================
PETROLEUM & FUEL PRODUCTS [1.8%]
Conoco Funding
6.350%, 10/15/11 750 788
============================================================
RETAIL [1.1%]
Target
5.400%, 10/01/08 250 251
Wal-Mart Stores
6.875%, 08/10/09 200 208
------------------------------------------------------------
TOTAL RETAIL 459
============================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 5
schedule of investments
MARCH 31, 2007 (UNAUDITED)
AHA Limited Maturity Fixed Income Fund (continued)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
SECURITY BROKERS & DEALERS [2.7%]
Countrywide Home Loan, MTN
3.250%, 05/21/08 $ 300 $ 293
Credit Suisse First Boston
3.875%, 01/15/09 300 294
Goldman Sachs Group
4.125%, 01/15/08 300 298
Merrill Lynch, Ser B, MTN
3.125%, 07/15/08 300 292
------------------------------------------------------------
TOTAL SECURITY BROKERS & DEALERS 1,177
============================================================
TELEPHONES & TELECOMMUNICATIONS [4.4%]
AT&T
6.250%, 03/15/11 750 779
BellSouth Telecommunications
5.875%, 01/15/09 300 303
Verizon Communications
7.250%, 12/01/10 750 801
------------------------------------------------------------
TOTAL TELEPHONES & TELECOMMUNICATIONS 1,883
============================================================
UTILITIES-ELECTRIC [0.6%]
Public Service Electric & Gas, Ser C, MTN
4.000%, 11/01/08 250 246
============================================================
TOTAL CORPORATE BONDS(COST $15,811) 15,811
========================================================
U.S. GOVERNMENT MORTGAGE-BACKED
OBLIGATIONS [24.7%]
FHLMC REMIC, Ser R003,
Cl AG
5.125%, 10/15/15 1,271 1,264
FHLMC REMIC, Ser R004,
Cl Al
5.125%, 12/15/13 1,184 1,178
FHLMC REMIC, Ser R007,
Cl AC
5.875%, 05/15/16 1,363 1,372
FHLMC REMIC, Ser R009,
Cl AK
5.750%, 12/15/18 1,359 1,364
FHLMC, Pool J04241
5.500%, 01/01/22 1,150 1,152
FHLMC, Pool J04459
5.000%, 03/01/22 295 291
FHLMC, Pool J04492
5.000%, 03/01/22 400 394
FHLMC, Pool J04508
5.000%, 03/01/22 300 296
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
FNMA REMIC, Ser R009,
Cl AJ
5.750%, 12/15/18 $1,555 $ 1,565
FNMA, Pool 541946
7.500%, 07/01/30 1 1
FNMA, Pool 584930
7.500%, 05/01/31 2 2
FNMA, Pool 837191
5.000%, 12/01/20 866 854
FNMA, Pool 837196
5.500%, 02/01/21 866 868
------------------------------------------------------------
TOTAL U.S. GOVERNMENT MORTGAGE-BACKED
OBLIGATIONS
(Cost $10,585) 10,601
========================================================
U.S. GOVERNMENT AGENCY OBLIGATIONS [23.8%]
FFCB
5.220%, 10/21/13 700 700
FHLB
4.375%, 09/17/10 1,000 986
FHLMC
5.250%, 05/21/09 980 987
5.125%, 10/15/08 1,000 1,003
4.625%, 12/19/08 700 697
4.250%, 07/15/09 265 262
3.875%, 06/15/08 540 533
3.625%, 09/15/08 1,130 1,110
FNMA
6.125%, 03/15/12 285 301
5.500%, 03/15/11 1,000 1,023
4.875%, 04/15/09 685 685
3.250%, 08/15/08 900 880
3.250%, 02/15/09 1,105 1,073
------------------------------------------------------------
TOTAL U.S. GOVERNMENT AGENCY
OBLIGATIONS
(Cost $10,221) 10,240
========================================================
U.S. TREASURY OBLIGATIONS [6.9%]
U.S. Treasury Notes
6.000%, 08/15/09 1,100 1,134
5.500%, 02/15/08 1,200 1,206
3.875%, 01/15/09 616 639
------------------------------------------------------------
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $2,967) 2,979
========================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 6
<page>
schedule of investments
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA Limited Maturity Fixed Income Fund (concluded)
DESCRIPTION FACE AMOUNT (000)/SHARES VALUE (000)
- ---------------------------------------------------------------
MORTGAGE-BACKED SECURITIES [5.1%]
Bear Stearns Commercial Mortgage
Securities, Ser 2001-TOP2, Cl A1
6.080%, 02/15/35 $ 422 $ 428
GMAC Commercial Mortgage
Securities, Ser 2004-C3, Cl A2
3.950%, 12/10/41 440 433
JPMorgan Commercial Mortgage,
Ser 2005-IDP5 Cl A1
5.035%, 12/15/44 480 478
Morgan Stanley Capital Investments,
Ser 2005-T17, Cl A2
4.110%, 12/13/41 869 858
------------------------------------------------------------
TOTAL MORTGAGE-BACKED SECURITIES
(Cost $2,239) 2,197
=======================================================
ASSET-BACKED SECURITIES [1.1%]
Chase Manhattan Auto Owner
Trust, Ser 2003-A, Cl A4
2.060%, 12/15/09 305 304
Nissan Auto Receivables Owner
Trust, Ser 2004-B, Cl A3
3.350%, 05/15/08 167 166
------------------------------------------------------------
TOTAL ASSET-BACKED SECURITIES
(Cost $471) 470
========================================================
CASH EQUIVALENT [1.1%]
Fidelity Institutional Domestic
Money Market Portfolio,
Cl I, 5.17% (A) 466,662 467
------------------------------------------------------------
TOTAL CASH EQUIVALENT
(Cost $467) 467
========================================================
TOTAL INVESTMENTs [99.4%]
(Cost $42,761) $42,765
=======================================================
PERCENTAGES BASED ON NET ASSETS OF $43,022 ($ THOUSANDS).
(A) THE RATE SHOWN IS THE 7-DAY EFFECTIVE YIELD AS OF MARCH 31, 2007.
CL -- CLASS
FFCB -- FEDERAL FARM CREDIT BANK
FHLB -- FEDERAL HOME LOAN BANK
FHLMC -- FEDERAL HOME LOAN MORTGAGE CORPORATION
FNMA -- FEDERAL NATIONAL MORTGAGE ASSOCIATION
MTN -- MEDIUM TERM NOTE
NA -- NATIONAL ASSOCIATION
REMIC -- REAL ESTATE MORTGAGE INVESTMENT CONDUIT
SER -- SERIES
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 7
schedule of investments
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA Full Maturity Fixed Income Fund
[Bar Chart Omitted]
Plot points are as follows:
SECTOR WEIGHTINGS*:
32.3% Corporate Bonds
19.9% U.S. Government Agency Obligations
14.5% U.S. Treasury Obligations
13.4% U.S. Government Mortgage-Backed Obligations
11.2% Mortgage-Backed Securities
3.1% Commercial Paper
2.3% Asset-Backed Securities
2.3% Cash Equivalent
0.9% Foreign Government Bonds
0.1% Municipal Bond
*Percentages based on total investments.
DESCRIPTION FACE AMOUNT (000)/SHARES VALUE (000)
- ---------------------------------------------------------------
CORPORATE BONDS [33.2%]
AEROSPACE & DEFENSE [0.2%]
United Technologies
4.375%, 05/01/10 $ 80 $ 78
============================================================
AGRICULTURE [0.3%]
Bunge NA Finance
5.900%, 04/01/17 100 99
============================================================
AIRLINES [0.0%]
Continental Airlines (D)
6.800%, 07/02/07 15 15
============================================================
AUTOMOTIVE [0.7%]
Auburn Hills Trust
12.375%, 05/01/20 55 87
DaimlerChrysler NA Holdings,
Ser D, MTN (A)
5.820%, 09/10/07 180 180
------------------------------------------------------------
TOTAL AUTOMOTIVE 267
============================================================
Banks [6.3%]
AmSouth Bancorporation
6.750%, 11/01/25 75 81
Bankers Trust
7.250%, 10/15/11 46 49
Bank of America
10.200%, 07/15/15 100 130
5.625%, 10/14/16 150 152
Bank One
10.000%, 08/15/10 89 101
Charter One Bank
5.500%, 04/26/11 250 254
Citigroup
3.625%, 02/09/09 300 293
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
Dime Capital Trust, Ser A
9.330%, 05/06/27 $ 50 $ 52
Dresdner Bank - New York
7.250%, 09/15/15 150 168
European Investment Bank
4.625%, 03/21/12 450 445
Federal Home Loan Bank
5.625%, 06/13/16 185 190
HSBC Holding
7.500%, 07/15/09 285 299
Santander Central Hispano Issuances
7.625%, 09/14/10 100 108
Wachovia
6.300%, 04/15/08 150 152
------------------------------------------------------------
TOTAL BANKS 2,474
============================================================
BUILDING & CONSTRUCTION [0.2%]
Hanson Australia Funding
5.250%, 03/15/13 75 74
============================================================
CHEMICALS [0.7%]
Dow Chemical
5.750%, 12/15/08 40 40
E.I. Du Pont De Nemours
4.125%, 04/30/10 250 244
------------------------------------------------------------
TOTAL CHEMICALS 284
============================================================
CABLE/MEDIA [0.2%]
TCI Communications
7.875%, 08/01/13 75 84
============================================================
COMPUTER SYSTEM DESIGN & SERVICES [0.8%]
IBM, MTN
4.375%, 06/01/09 300 297
============================================================
DIVERSIFIED OPERATIONS [0.4%]
Hutchison Whamp International (D)
5.450%, 11/24/10 150 151
============================================================
DRUGS [0.2%]
Teva Pharmaceutical
5.550%, 02/01/16 75 74
============================================================
ELECTRICAL SERVICES [0.3%]
Public Service Company of
Colorado
4.375%, 10/01/08 100 99
============================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 8
schedule of investments
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA Full Maturity Fixed Income Fund (continued)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
ENERGY [1.6%]
Carolina Power & Light
5.150%, 04/01/15 $ 80 $ 78
Exelon
5.625%, 06/15/35 75 69
Korea Electric Power
7.750%, 04/01/13 95 107
6.750%, 08/01/27 75 84
Pacific Gas & Electric
6.050%, 03/01/34 25 25
PPL Energy Supply, Ser A
5.700%, 10/15/15 75 74
PSI Energy
7.850%, 10/15/07 125 126
United Utilities
6.450%, 04/01/08 70 71
------------------------------------------------------------
TOTAL ENERGY 634
============================================================
FINANCIAL SERVICES [6.4%]
American Express Credit
3.000%, 05/16/08 300 293
American General Finance
8.450%, 10/15/09 100 108
Associates NA, Ser A
7.950%, 02/15/10 75 81
Caterpillar Financial Services
4.875%, 06/15/07 300 300
Caterpillar Financial Services,
Ser F, MTN
3.450%, 01/15/09 50 49
Countrywide Financial
6.250%, 05/15/16 100 101
5.610%, 05/05/08 (A) 90 90
General Electric Capital
5.500%, 04/28/11 80 81
General Electric Capital,
Ser A, MTN
5.000%, 06/15/07 300 300
6.000%, 06/15/12 75 78
HSBC Finance
5.000%, 06/30/15 75 72
Lehman Brothers Holdings
6.625%, 01/18/12 300 317
National Rural Utilities
3.875%, 02/15/08 50 49
NiSource Finance
7.875%, 11/15/10 75 81
Residential Capital (A)
6.725%, 06/29/07 90 90
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
Swedish Export Credit
4.875%, 01/19/10 $ 280 $ 280
UFJ Finance Aruba
6.750%, 07/15/13 125 135
------------------------------------------------------------
TOTAL FINANCIAL SERVICES 2,505
============================================================
FOOD, BEVERAGE & TOBACCO [0.6%]
Kraft Foods 6.250%, 06/01/12 150 156
5.625%, 11/01/11 40 41
Pepsi Bottling Holdings (D)
5.625%, 02/17/09 50 50
------------------------------------------------------------
TOTAL FOOD, BEVERAGE & TOBACCO 247
============================================================
INSURANCE [0.4%]
Protective Life
4.300%, 06/01/13 100 95
WellPoint
3.750%, 12/14/07 50 49
------------------------------------------------------------
TOTAL INSURANCE 144
============================================================
INVESTMENT BANKER/BROKER DEALER [2.7%]
Bear Stearns
5.350%, 02/01/12 275 276
Bear Stearns, Ser B, MTN
4.550%, 06/23/10 50 49
Citigroup
4.125%, 02/22/10 80 78
Goldman Sachs Group
6.600%, 01/15/12 200 211
5.650%, 06/28/10 (A) 100 101
5.150%, 01/15/14 75 73
Merrill Lynch, Ser C, MTN (A)
5.580%, 02/05/10 70 70
Morgan Stanley
5.640%, 01/15/10 140 141
4.750%, 04/01/14 (A) 75 71
------------------------------------------------------------
TOTAL INVESTMENT BANKER/BROKER DEALER 1,070
============================================================
MANUFACTURING [0.6%]
General Electric
5.000%, 02/01/13 150 149
Tyco International Group
6.375%, 10/15/11 75 79
------------------------------------------------------------
TOTAL MANUFACTURING 228
============================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 9
schedule of investments
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA Full Maturity Fixed Income Fund (continued)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
METALS & MINING [0.5%]
Vale Overseas
6.875%, 11/21/36 $ 100 $ 103
6.250%, 01/23/17 100 102
------------------------------------------------------------
TOTAL METALS & MINING 205
============================================================
MORTGAGE FINANCE [0.2%]
Residential Capital
6.000%, 02/22/11 75 74
============================================================
MULTI-MEDIA [1.0%]
Time Warner
9.125%, 01/15/13 50 58
5.875%, 11/15/16 85 86
Viacom
7.700%, 07/30/10 75 81
Walt Disney
6.375%, 03/01/12 150 158
------------------------------------------------------------
TOTAL MULTI-MEDIA 383
============================================================
OIL & GAS [1.6%]
ConocoPhillips
5.300%, 04/15/12 300 303
Shell International
5.625%, 06/27/11 300 308
------------------------------------------------------------
TOTAL OIL & GAS 611
============================================================
PERSONAL CREDIT INSTITUTIONS [0.5%]
Household Finance
6.375%, 10/15/11 175 182
============================================================
PETROLEUM & FUEL PRODUCTS [0.6%]
Cooper Cameron
2.650%, 04/15/07 100 100
Energy Transfer Partners
6.625%, 10/15/36 75 77
Pemex Project Funding Master Trust
9.125%, 10/13/10 50 56
------------------------------------------------------------
TOTAL PETROLEUM & FUEL PRODUCTS 233
============================================================
PETROLEUM EXPLORATION [0.3%]
Travelers (A)
6.250%, 03/15/67 100 99
============================================================
REAL ESTATE INVESTMENT TRUST [0.2%]
Masco
6.125%, 10/03/16 75 76
============================================================
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
RETAIL [2.2%]
Eksportsfinans, Ser G, MTN
5.125%, 10/26/11 $ 300 $ 302
Home Depot
5.250%, 12/16/13 310 308
Lowe's
5.000%, 10/15/15 200 194
Target
5.400%, 10/01/08 50 50
------------------------------------------------------------
TOTAL RETAIL 854
============================================================
SECURITY BROKERS & DEALERS [0.3%]
Istar Financial
5.850%, 03/15/17 100 99
============================================================
SHORT-TERM BUSINESS CREDIT [0.2%]
Citigroup Canada
5.200%, 06/01/15 100 97
============================================================
TELECOMMUNICATIONS [0.6%]
Deutsche Telekom
8.000%, 06/15/10 25 27
SBC Communications
5.300%, 11/15/10 200 201
-------------------------------------------------------------
TOTAL TELECOMMUNICATIONS 228
============================================================
TELEPHONES & TELECOMMUNICATIONS [2.0%]
British Telecommunications
8.875%, 12/15/30 100 137
8.375%, 12/15/10 (B) 60 67
Deutsche Telekom International
Finance
8.250%, 06/15/30 75 93
France Telecom
7.750%, 03/01/11 50 54
New Cingular Wireless Services
8.750%, 03/01/31 75 97
Royal KPN
8.000%, 10/01/10 10 11
Sprint Capital
6.900%, 05/01/19 75 78
Telecom Italia Capital
7.200%, 07/18/36 75 78
Telefonica Emisiones
6.421%, 06/20/16 75 78
Verizon Global Funding
4.000%, 01/15/08 100 99
------------------------------------------------------------
TOTAL TELEPHONES & TELECOMMUNICATIONS 792
============================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 10
schedule of investments
March 31, 2007 (Unaudited)
- --------------------------------------------------------------------------------
AHA Full Maturity Fixed Income Fund (continued)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
TRANSPORTATION SERVICES [0.4%]
FedEx
9.650%, 06/15/12 $ 125 $ 149
============================================================
TOTAL CORPORATE BONDS(Cost $12,801) 12,906
========================================================
U.S. GOVERNMENT AGENCY OBLIGATIONS [20.5%]
FAMC, MTN
4.250%, 07/29/08 20 20
FFCB
4.875%, 04/04/12 200 200
FHLB
4.500%, 11/15/12 325 319
FHLMC 6.875%, 09/15/10 300 320
6.000%, 01/15/17 140 143
5.875%, 03/21/11 350 363
5.500%, 04/15/17 149 150
5.000%, 07/15/14 525 528
5.000%, 02/01/21 450 444
5.000%, 05/15/21 150 148
4.375%, 07/17/15 745 715
FNMA 6.625%, 09/15/09 200 208
6.125%, 03/15/12 550 581
6.000%, 05/15/11 (E) 2,050 2,138
5.500%, 04/01/36 547 542
5.250%, 01/15/09 500 503
5.000%, 11/01/35 184 178
4.625%, 05/01/13 200 196
4.375%, 09/15/12 125 122
GNMA
3.727%, 03/16/27 146 142
------------------------------------------------------------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS
(Cost $7,928) 7,960
========================================================
U.S. TREASURY OBLIGATIONS [14.8%]
U.S. Treasury Bonds
9.125%, 05/15/18 275 378
6.250%, 08/15/23 1,800 2,066
U.S. Treasury Notes
5.750%, 08/15/10 345 358
4.875%, 08/15/16 300 305
4.750%, 05/15/14 225 227
4.500%, 02/15/09 700 698
4.375%, 12/15/10 400 398
4.000%, 04/15/10 350 345
3.500%, 02/15/10 580 564
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
U.S. TREASURY STRIP
0.000%, 11/15/15 $ 650 $ 435
------------------------------------------------------------
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $5,729) 5,774
========================================================
U.S. GOVERNMENT MORTGAGE-BACKED OBLIGATIONS [13.7%]
FHLMC Gold, Pool G11880
5.000%, 12/01/20 173 170
FHLMC REMIC, Ser 2720, Cl JB
5.000%, 12/15/16 150 149
FHLMC REMIC, Ser R003, Cl VA
5.500%, 08/15/16 180 182
FHLMC, Pool 160098
10.500%, 01/01/10 4 4
FHLMC, Pool 1B2550 (A)
5.294%, 02/01/36 242 242
FHLMC, Pool 1B2677 (A)
4.104%, 01/01/35 40 39
FHLMC, Pool 1B2683 (A)
4.079%, 01/01/35 23 23
FHLMC, Pool 1B2692 (A)
4.462%, 12/01/34 68 68
FHLMC, Pool 1q008 (A)
5.079%, 03/01/36 332 330
FHLMC, Pool 8201
6.000%, 07/01/34 182 184
FHLMC, Pool C00760
6.500%, 05/01/29 26 26
FHLMC, Pool C20300
6.500%, 01/01/29 18 18
FHLMC, Pool E01280
5.000%, 12/01/17 65 64
FHLMC, Pool G11431
6.000%, 02/01/18 173 176
FHLMC, Pool G18124
6.000%, 06/01/21 181 184
FHLMC, Ser 2141, Cl N
5.550%, 11/15/27 23 23
FHLMC, Ser 2533, Cl PC
5.000%, 10/15/17 27 27
FHLMC, Ser 2544, Cl QB
5.000%, 09/15/15 98 98
FHLMC, Ser 2804, Cl VC
5.000%, 07/15/21 178 174
FHLMC, Ser 3132, Cl MA
5.500%, 12/15/23 164 165
FNMA REMIC, Ser R009, Cl AJ
5.750%, 12/15/18 189 190
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 11
schedule of investments
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA Full Maturity Fixed Income Fund (continued)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
FNMA, Pool 13751
5.500%, 08/01/35 $ 255 $ 253
FNMA, Pool 252570
6.500%, 07/01/29 36 37
FNMA, Pool 253183
7.500%, 04/01/30 3 3
FNMA, Pool 253398
8.000%, 08/01/30 12 12
FNMA, Pool 254510
5.000%, 11/01/17 83 82
FNMA, Pool 254545
5.000%, 12/01/17 160 159
FNMA, Pool 254685
5.000%, 04/01/18 120 119
FNMA, Pool 254949
5.000%, 11/01/33 95 92
FNMA, Pool 254953
5.000%, 11/01/18 64 64
FNMA, Pool 303168
9.500%, 02/01/25 9 10
FNMA, Pool 735060
6.000%, 11/01/34 129 130
FNMA, Pool 735228
5.500%, 02/01/35 107 106
FNMA, Pool 827223 (A)
4.777%, 04/01/35 211 210
FNMA, Pool 835744
5.000%, 09/01/35 573 554
FNMA, Ser 1992, Cl 136
6.000%, 08/25/22 46 46
FNMA, Ser 2003, Cl 16
5.000%, 10/25/15 150 149
FNMA, Ser 2003, Cl 18
5.000%, 03/25/16 119 119
FNMA, Ser 2003, Cl 31
4.500%, 12/25/28 107 106
FNMA, Ser 2004-W6, Cl 1A6
5.500%, 07/25/34 95 94
FNMA, Ser 2006-B2, Cl AB
5.500%, 05/25/14 273 274
GNMA, Pool 479168
8.000%, 02/15/30 20 22
GNMA, Pool 780315
9.500%, 12/15/17 18 20
GNMA, Ser 2004, Cl 78
4.658%, 04/16/29 150 146
------------------------------------------------------------
TOTAL U.S. GOVERNMENT MORTGAGE-BACKED
OBLIGATIONS
(Cost $5,378) 5,343
============================================================
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
MORTGAGE-BACKED SECURITIES [11.5%]
Banc of America Alternative
Loan Trust, Ser 2004-2, Cl 5A1
5.500%, 03/25/19 $ 139 $ 140
Banc of America Alternative
Loan Trust, Ser 2005-4, Cl CB11
5.500%, 05/25/35 148 148
Banc of America Alternative
Loan Trust, Ser 2005-6, Cl 7A1
5.500%, 07/25/20 113 113
Banc of America Alternative
Loan Trust, Ser 2005-9, Cl 1CB3
5.500%, 10/25/35 129 129
Banc of America Alternative
Loan Trust, Ser 2006-2, Cl 6A1
5.500%, 03/25/21 155 156
Bear Stearns Commercial Mortgage,
Ser 2006-PW12, Cl A4
5.712%, 09/11/38 300 309
Chase Mortgage Finance,
Ser 2003-S13, Cl A11
5.500%, 11/25/33 113 114
Citigroup Mortgage Loan Trust,
Ser 2005-9, Cl 2A2
5.500%, 11/25/35 124 125
Citigroup/Deutsche Bank
Commerical Mortgage
5.205%, 12/11/49 400 400
Commercial Mortgage,
Ser 2006-C8, Cl A2B
5.248%, 12/10/46 185 185
Countrywide Asset-Backed
Certificate, Ser 2007-S1,
Cl A6 (A)
5.693%, 02/25/37 200 199
Countrywide Asset-Backed
Certificates, Ser 2006-11,
Cl 1AF3 (A)
6.050%, 09/25/46 200 202
Deutsche Bank Alternative
Securities, Ser 2006, Cl AR5
6.000%, 10/15/21 190 193
First Horizon Alternative Mortgage
Securities, Ser 2006-FA8, Cl 2A1
5.750%, 02/25/37 193 194
GE Capital Commercial Mortgage,
Ser 2002-3A, Cl A2
4.996%, 12/10/37 150 149
GMAC Commercial Mortgage
Securities, Ser 2003-C1, Cl A2
4.079%, 05/10/36 225 212
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 12
schedule of investments
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA Full Maturity Fixed Income Fund
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
GMAC Mortgage Corporation
Loan Trust, Ser 2004-GH1,
Cl A6 (A)
4.810%, 07/25/35 $ 150 $ 148
GMAC Mortgage Corporation
Loan Trust, Ser 2004-J4,
Cl A2
5.500%, 08/25/14 119 119
JPMorgan Alternative Loan Trust,
Ser 2006-S3, Cl A3A
6.000%, 08/25/36 200 200
JPMorgan Chase, Ser 2006-CB17,
Cl ASB
5.415%, 12/12/43 200 201
JPMorgan Mortgage Trust,
Ser 2006-A7, Cl 2A4R (A)
5.500%, 01/25/37 200 201
RAAC, Ser 2004-SP1, Cl AI4 (A)
5.285%, 08/25/27 150 149
Renaissance Home Equity,
Ser 2007-1, Cl AF2
5.512%, 04/25/37 200 200
Residential Accredit Loans,
Ser 2004-QS5, Cl A5
4.750%, 04/25/34 53 51
Residential Accredit Loans,
Ser 2004-QS6, Cl A1
5.000%, 05/25/19 91 90
Wachovia Bank Commercial
Mortgage, Ser 2003-C3, Cl A2
4.867%, 02/15/35 150 147
------------------------------------------------------------
TOTAL MORTGAGE-BACKED SECURITIES
(Cost $4,487) 4,474
========================================================
COMMERCIAL PAPER [3.2%]
Manhattan Asset Funding (F) (G)
5.300%, 04/02/07 1,231 1,231
============================================================
TOTAL COMMERCIAL PAPER
(Cost $1,231) 1,231
========================================================
ASSET-BACKED SECURITIES [2.3%]
CitiFinancial Mortgage Securities,
Ser 2004-1, Cl AF2 (B)
2.645%, 04/25/34 92 90
Cityscape Home Equity Loan Trust,
Ser 1997-C, Cl A4 (B)
7.000%, 07/25/28 16 16
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
Contimortgage Home Equity
Loan Trust, Ser 1997-2, Cl A9
7.090%, 04/15/28 $ 7 $ 7
Fairbanks Capital Mortgage,
Ser 1991-1, Cl A (A)
5.920%, 05/25/28 42 42
Green Tree Financial,
Ser 1997-7, Cl A6
6.760%, 07/15/29 134 139
GSAA Home Equity Trust,
Ser 2005-1, Cl AF2 (A)
4.316%, 11/25/34 150 147
Renaissance Home Equity
Loan Trust, Ser 2005-3,
Cl AF2 (B)
4.723%, 11/25/35 114 113
Residential Asset Securities,
Ser 2002-RS3, Cl AI5
5.572%, 06/25/32 96 96
Residential Asset Securities,
Ser 2003-KS5, Cl AI6
3.620%, 07/25/33 182 174
Residential Asset Securities,
Ser 2004-KS5, Cl AI3 (A)
4.030%, 04/25/30 52 52
UCFC Home Equity Loan,
Ser 1998-C, Cl A7
5.935%, 01/15/30 27 27
------------------------------------------------------------
TOTAL ASSET-BACKED SECURITIES
(Cost $911) 903
========================================================
FOREIGN GOVERNMENT BONDS [0.9%]
Cia Bras Bebida
8.750%, 09/15/13 175 203
National Bank of Hungary
8.875%, 11/01/13 75 90
United Mexican States
9.875%, 02/01/10 50 56
------------------------------------------------------------
TOTAL FOREIGN GOVERNMENT BONDS
(Cost $339) 349
============================================================
MUNICIPAL BOND [0.1%]
LOUISIANA [0.1%]
Louisiana State, Tobacco Settlement
Financing Authority, Ser 2001A
6.360%, 05/15/25 38 38
------------------------------------------------------------
Total Municipal Bond(Cost $38) 38
========================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 13
schedule of investments
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA Full Maturity Fixed Income Fund (concluded)
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------------
Cash Equivalents [2.4%]
AIM Short-Term Investment
Company Liquid Assets
Portfolio (F) 57,807 $ 58
Fidelity Institutional Domestic
Money Market Portfolio,
Cl I, 5.17% (C) 877,410 877
------------------------------------------------------------
TOTAL CASH EQUIVALENTS
(Cost $935) 935
========================================================
TOTAL INVESTMENTS [102.6%]
(Cost $39,777) $39,913
========================================================
PERCENTAGES BASED ON NET ASSETS OF $38,920 ($ THOUSANDS).
* NON-INCOME PRODUCING SECURITY
(A) FLOATING RATE SECURITY -- THE RATE REFLECTED ON THE SCHEDULE OF INVESTMENTS
IS THE RATE IN EFFECT ON MARCH 31, 2007.
(B) STEP BOND -- THE RATE REFLECTED ON THE SCHEDULE OF INVESTMENTS IS THE RATE
IN EFFECT ON MARCH 31, 2007. THE COUPON ON A STEP BOND CHANGES ON A SPECIFIC
DATE.
(C) THE RATE SHOWN IS THE 7-DAY EFFECTIVE YIELD AS OF MARCH 31, 2007.
(D) SECURITY EXEMPT FROM REGISTRATION UNDER RULE 144A OF THE SECURITIES ACT OF
1933. THESE SECURITIES MAY BE RESOLD IN TRANSACTIONS EXEMPT FROM
REGISTRATION NORMALLY TO QUALIFIED INSTITUTIONS. ON MARCH 31, 2007, THE
VALUE OF THESE SECURITIES AMOUNTED TO $216 (000)'S, REPRESENTING 0.6% OF THE
NET ASSETS OF THE FUND.
(E) THIS SECURITY OR A PARTIAL POSITION OF THIS SECURITY IS ON LOAN AT MARCH 31,
2007. THE TOTAL VALUE OF SECURITIES ON LOAN AT MARCH 31, 2007 WAS
$1,224,907.
(F) THIS SECURITY WAS PURCHASED WITH CASH COLLATERAL RECEIVED FROM SECURITIES
LENDING. THE TOTAL VALUE OF SUCH SECURITIES AT MARCH 31, 2007 WAS
$1,288,372.
(G) RATE SHOWN IS THE 7-DAY EFFECTIVE YIELD AT TIME OF PURCHASE.
CL -- CLASS
FAMC -- FEDERAL AGRICULTURAL MORTGAGE CORPORATION
FFCB -- FEDERAL FARM CREDIT BANK
FHLB -- FEDERAL HOME LOAN BANK
FHLMC -- FEDERAL HOME LOAN MORTGAGE CORPORATION
FNMA -- FEDERAL NATIONAL MORTGAGE ASSOCIATION
GNMA -- GOVERNMENT NATIONAL MORTGAGE ASSOCIATION
LLC -- LIMITED LIABILITY COMPANY
MTN -- MEDIUM TERM NOTE
NA -- NATIONAL ASSOCIATION
REMIC -- REAL ESTATE MORTGAGE INVESTMENT CONDUIT
SER -- SERIES
STRIP -- SEPARATELY TRADED REGISTERED INTEREST AND PRINCIPAL SECURITY
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 14
schedule of investments
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA Balanced Fund
[Bar Chart Omitted]
Plot points are as follows:
SECTOR WEIGHTINGS*:
60.0% Common Stock
10.0% Mortgage-Backed Securities
9.7% U.S. Government Mortgage-Backed Obligations
6.8% Corporate Bonds
6.4% U.S. Treasury Obligations
2.7% U.S. Government Agency Obligations
1.9% Commercial Paper
0.9% Cash Equivalent
0.8% Asset-Backed Securities
0.6% Foreign Government Bonds
0.2% Municipal Bond
*Percentages based on total investments.
- ---------------------------------------------------------------
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------------
COMMON STOCK [61.1%]
AEROSPACE & DEFENSE [1.8%]
Lockheed Martin 1,388 $ 135
United Technologies 2,453 159
----------------------------------------------------------
TOTAL AEROSPACE & DEFENSE 294
==========================================================
AIR TRANSPORTATION [0.0%]
FedEx 66 7
==========================================================
AUTOMOTIVE [0.8%]
Autozone* 351 45
Paccar 1,135 83
----------------------------------------------------------
TOTAL AUTOMOTIVE 128
==========================================================
BANKS [5.8%]
Bank of America 5,590 285
JPMorgan Chase 4,780 231
National City 2,341 87
PNC Financial Services Group 1,361 98
Washington Mutual 3,184 129
Wells Fargo 3,496 120
----------------------------------------------------------
TOTAL BANKS 950
==========================================================
BIOMEDICAL RESEARCH & PRODUCTS [0.2%]
Quest Diagnostic 541 27
==========================================================
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------------
BROADCASTING & CABLE [1.5%]
Cisco Systems* 4,110 $ 105
Motorola 7,532 133
----------------------------------------------------------
TOTAL BROADCASTING & CABLE 238
==========================================================
BUILDING & CONSTRUCTION [0.3%]
Lennar, Cl A 1,090 46
==========================================================
BUSINESS SERVICES [1.2%]
Convergys* 2,300 59
Omnicom Group 751 77
Xerox* 3,806 64
----------------------------------------------------------
TOTAL BUSINESS SERVICES 200
==========================================================
CHEMICALS [0.5%]
Eastman Chemical 754 48
Hercules* 2,094 41
----------------------------------------------------------
TOTAL CHEMICALS 89
==========================================================
COMMUNICATION & MEDIA [1.1%]
DIRECTV Group* 3,039 70
Time Warner 5,315 105
----------------------------------------------------------
TOTAL COMMUNICATION & MEDIA 175
==========================================================
COMPUTERS-SOFTWARE [1.6%]
Microsoft 3,549 99
Oracle* 9,113 165
----------------------------------------------------------
TOTAL COMPUTERS-SOFTWARE 264
==========================================================
COMPUTER SYSTEM DESIGN & SERVICES [0.3%]
Lexmark International, Cl A* 753 44
==========================================================
CONSUMER PRODUCTS & SERVICES [0.8%]
Kimberly-Clark 840 58
Procter & Gamble 937 59
Whirlpool 155 13
----------------------------------------------------------
TOTAL CONSUMER PRODUCTS & SERVICES 130
==========================================================
CONTAINERS & PACKAGING [0.4%]
Pactiv* 1,769 60
==========================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 15
schedule of investments
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA Balanced Fund (CONTINUED)
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------------
DIVERSIFIED MANUFACTURING [1.8%]
Danaher 1,126 $ 81
General Electric 6,060 214
----------------------------------------------------------
TOTAL DIVERSIFIED MANUFACTURING 295
==========================================================
DIVERSIFIED METALS & MINING [2.9%]
Freeport-McMoran Copper & Gold, Cl B 1,091 72
Hewlett-Packard 4,748 191
IBM 2,285 215
----------------------------------------------------------
TOTAL DIVERSIFIED METALS & MINING 478
==========================================================
DRUGS [4.4%]
Johnson & Johnson 3,948 238
Merck 4,158 184
Pfizer 9,759 247
Wyeth 1,169 58
----------------------------------------------------------
TOTAL DRUGS 727
==========================================================
ELECTRICAL PRODUCTS [0.1%]
Medtronic 488 24
==========================================================
ELECTRICAL SERVICES [1.7%]
Centerpoint Energy 2,465 44
DTE Energy 993 48
Duke Energy 4,951 100
Pinnacle West Capital 779 38
TXU 361 23
Xcel Energy 1,103 27
----------------------------------------------------------
TOTAL ELECTRICAL SERVICES 280
==========================================================
ENERGY [1.0%]
Entergy 190 20
PG&E 1,600 77
Sempra Energy 1,034 63
----------------------------------------------------------
TOTAL ENERGY 160
==========================================================
ENTERTAINMENT [0.6%]
Carnival 2,000 94
==========================================================
FINANCIAL SERVICES [2.7%]
CIT Group 1,090 58
Citigroup 5,775 296
Countrywide Financial 2,797 94
----------------------------------------------------------
TOTAL FINANCIAL SERVICES 448
==========================================================
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------------
FOOD, BEVERAGE & TOBACCO [2.7%]
General Mills 1,590 $ 92
Kellogg 1,028 53
Pepsi Bottling Group 1,556 50
PepsiCo 2,624 167
Safeway 1,987 73
----------------------------------------------------------
TOTAL FOOD, BEVERAGE & TOBACCO 435
==========================================================
GAS/NATURAL GAS [0.2%]
Nicor 574 28
==========================================================
HEALTHCARE PRODUCTS & SERVICES [0.6%]
Applera - Applied Biosystems Group 1,280 38
Cigna 401 57
----------------------------------------------------------
TOTAL HEALTHCARE PRODUCTS & SERVICES 95
==========================================================
HOTELS & LODGING [0.2%]
Starwood Hotels & Resorts Worldwide 628 41
----------------------------------------------------------
HOUSEHOLD FURNITURE & FIXTURES [0.1%]
Masco 856 23
==========================================================
INSURANCE [3.5%]
ACE 1,400 80
Allstate 2,149 129
American International Group 559 38
Chubb 630 32
Genworth Financial, Cl A 2,090 73
Hartford Financial Services Group 1,259 120
Lincoln National 601 41
Torchmark 447 29
XL Capital, Cl A 470 33
----------------------------------------------------------
TOTAL INSURANCE 575
==========================================================
INVESTMENT BANKER/BROKER DEALER [2.1%]
Goldman Sachs Group 850 176
Merrill Lynch 342 28
Morgan Stanley 1,717 135
----------------------------------------------------------
TOTAL INVESTMENT BANKER/BROKER DEALER 339
==========================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 16
schedule of investments
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA Balanced Fund (CONTINUED)
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------------
MACHINERY [0.8%]
Cummins 420 $ 61
Eaton 790 66
----------------------------------------------------------
TOTAL MACHINERY 127
==========================================================
MEDICAL PRODUCTS & SERVICES [1.9%]
Bard (C.R.) 100 8
Becton Dickinson 1,108 85
Health Management, Cl A 3,039 33
Laboratory* 651 47
Wellpoint* 1,687 137
Zimmer Holdings* 3 --
----------------------------------------------------------
TOTAL MEDICAL PRODUCTS & SERVICES 310
==========================================================
MISCELLANEOUS MANUFACTURING [0.2%]
Tyco International 1,098 35
==========================================================
MULTI-MEDIA [1.0%]
Walt Disney 4,758 164
==========================================================
OFFICE FURNITURE & FIXTURES [0.2%]
VeriSign* 1,538 39
==========================================================
PAPER & PAPER PRODUCTS [0.2%]
International Paper 767 28
==========================================================
PETROLEUM & FUEL PRODUCTS [7.0%]
Apache 1,301 92
Ashland 652 43
Baker Hughes 1,259 83
Chesapeake Energy (D) 1,767 54
ChevronTexaco 3,146 233
ConocoPhillips 2,871 196
Exxon Mobil 3,149 238
Marathon Oil 1,351 133
Nabors Industries* 1,515 45
Occidental Petroleum 441 22
----------------------------------------------------------
TOTAL PETROLEUM & FUEL PRODUCTS 1,139
==========================================================
PETROLEUM REFINING [0.0%]
Hess 149 8
==========================================================
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------------
PRINTING & PUBLISHING [0.6%]
Gannett 923 $ 52
Meredith 590 34
Tribune 140 4
----------------------------------------------------------
TOTAL PRINTING & PUBLISHING 90
==========================================================
RAILROADS [0.4%]
CSX 1,717 69
==========================================================
REAL ESTATE INVESTMENT TRUSTS [0.4%]
Boston Properties 152 18
Temple-Inland 748 44
----------------------------------------------------------
TOTAL REAL ESTATE INVESTMENT TRUSTS 62
==========================================================
RESIDENTIAL HOUSING [0.3%]
DR Horton 2,002 44
==========================================================
RETAIL [2.3%]
Autonation* 1,992 42
Big Lots* 290 9
Dillard's, Cl A 1,258 41
Federated Department Stores 2,117 96
JC Penney 88 7
Kroger 2,915 82
Lowe's 2,013 64
Sherwin Williams 618 41
----------------------------------------------------------
TOTAL RETAIL 382
==========================================================
SEMI-CONDUCTORS [1.7%]
Applied Materials 5,476 100
Teradyne* 2,792 46
Texas Instruments 4,297 130
----------------------------------------------------------
TOTAL SEMI-CONDUCTORS 276
==========================================================
STEEL & STEEL WORKS [0.9%]
Nucor 1,224 80
United States Steel 706 70
----------------------------------------------------------
TOTAL STEEL & STEEL WORKS 150
==========================================================
TELEPHONES & TELECOMMUNICATIONS [2.0%]
AT&T 2,107 83
Embarq 1,034 58
Verizon Communications 4,810 183
----------------------------------------------------------
TOTAL TELEPHONES & TELECOMMUNICATIONS 324
==========================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 17
schedule of investments
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA Balanced Fund (CONTINUED)
DESCRIPTION SHARES/FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
Trucking [0.3%]
Ryder System 895 $ 44
==========================================================
Total Common Stock
(Cost $9,445) 9,985
======================================================
MORTGAGE-BACKED SECURITIES [10.2%]
Banc of America Alternative Loan
Trust, Ser 2005-6, Cl 7A1
5.500%, 07/25/20 $ 38 38
Chase Mortgage Finance,
Ser 2003-S14, Cl 3A6
5.500%, 01/25/34 52 53
Citicorp Mortgage Securities,
Ser 2003-11, Cl 2A8
5.500%, 12/25/33 58 58
Citicorp Mortgage Securities,
Ser 2004-4, Cl A5
5.500%, 06/25/34 80 79
Citigroup Mortgage Loan Trust,
Ser 2005-9, Cl 2A2
5.500%, 11/25/35 62 63
Countrywide Alternative Loan
Trust, Ser 2005-50CB, Cl 4A1
5.000%, 11/25/20 40 40
Countrywide Alternative Loan
Trust, Ser 2005-85CB, Cl 3A1
5.250%, 02/25/21 83 82
Countrywide Alternative Loan Trust,
Ser 2006-7CB, Cl 3A1
5.250%, 05/25/21 65 65
Countrywide Asset-Backed
Certificates, Ser 2005-13,
Cl AF2 (A)
5.294%, 04/25/36 75 75
Countrywide Asset-Backed
Certificates, Ser 2006-11,
Cl 1AF3 (A)
6.050%, 09/25/46 100 101
Credit-Based Asset Servicing
Home Equity, Ser 2005-CB8,
Cl AF2 (B)
5.303%, 12/25/35 75 75
Deutsche Bank Alternative
Securities, Ser 2006, Cl AR5
6.000%, 10/15/21 95 96
First Horizon CMO, Ser 2006-FA6,
Cl 3A1
5.750%, 11/25/21 94 94
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
First Union National Bank CMO,
Ser 2001-C4, Cl A2
6.223%, 12/12/33 $ 50 $ 52
GE Capital Commercial Mortgage,
Ser 2002-3A, Cl A2
4.996%, 12/10/37 100 99
GMAC Commercial Mortgage
Securities, Ser 2003-C1, Cl A2
4.079%, 05/10/36 100 94
GMAC Mortgage Corporation Loan
Trust, Ser 2004, Cl HE5 (A)
4.388%, 09/25/34 75 73
GMAC Mortgage Corporation Loan
Trust, Ser 2004-GH1, Cl A6 (A)
4.810%, 07/25/35 75 74
GMAC Mortgage Corporation Loan
Trust, Ser 2004-J4, Cl A2
5.500%, 08/25/14 59 59
JPMorgan Mortgage Trust, Ser 2006-A7,
Cl 2A4R (A)
5.500%, 01/25/37 100 101
RAAC, Ser 2004-SP1, Cl AI4 (A)
5.285%, 08/25/27 75 74
Residential Accredit Loans,
Ser 2004-QS5, Cl A5
4.750%, 04/25/34 26 26
Residential Accredit Loans,
Ser 2004-QS6, Cl A1
5.000%, 05/25/19 30 30
Residential Funding Mortgage
Securities, Ser 2003-S11, Cl A2
4.000%, 06/25/18 75 71
----------------------------------------------------------
TOTAL MORTGAGE-BACKED SECURITIES
(COST $1,684) 1,672
======================================================
U.S. GOVERNMENT MORTGAGE-BACKED OBLIGATIONS [9.9%]
FHLMC Gold, Pool C90691
5.500%, 07/01/23 52 52
FHLMC Gold, Pool G0182
6.000%, 05/01/35 90 91
FHLMC REMIC, Ser 2673, Cl NC
5.500%, 05/15/21 75 75
FHLMC REMIC, Ser R007, Cl AC
5.875%, 05/15/16 83 83
FHLMC, Pool C00760
6.500%, 05/01/29 18 19
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 18
schedule of investments
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA Balanced Fund (CONTINUED)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
FHLMC, Pool G11771
6.000%, 06/01/20 $ 78 $ 79
FHLMC, Ser 2533, Cl PC
5.000%, 10/15/17 16 16
FHLMC, Ser 2578 PD
5.000%, 08/15/14 50 50
FNMA REMIC,
Ser R009, Cl AJ
5.750%, 12/15/18 94 95
FNMA, Pool 254800
5.500%, 07/01/23 387 386
FNMA, Pool 256171
6.000%, 03/01/26 222 225
FNMA, Pool 725773
5.500%, 09/01/34 124 123
FNMA, Pool 735228
5.500%, 02/01/35 53 53
FNMA, Pool 790108
6.000%, 08/01/34 64 65
FNMA, Ser 2003, Cl 18
5.000%, 03/25/16 100 99
FNMA, Ser 2003, Cl 31
4.500%, 12/25/28 61 61
FNMA, Ser 2004-W10, Cl A24
5.000%, 08/25/34 50 49
----------------------------------------------------------
TOTAL U.S. GOVERNMENT MORTGAGE-BACKED
OBLIGATIONS
(Cost $1,623) 1,621
======================================================
CORPORATE BONDS [6.9%]
Agriculture [0.1%]
Bunge NA Finance
5.900%, 04/01/17 25 25
=========================================================
BANKS [2.4%]
AmSouth Bancorporation
6.750%, 11/01/25 50 54
Bank of Oklahoma, Ser AI
7.125%, 08/15/07 50 50
Bank United, Ser A, MTN
8.000%, 03/15/09 50 53
Bankers Trust
7.500%, 11/15/15 25 28
Compass Bank
8.100%, 08/15/09 50 53
Dresdner Bank - New York
7.250%, 09/15/15 50 56
First Maryland Bancorporation
7.200%, 07/01/07 50 50
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
PNC Funding
7.500%, 11/01/09 $ 50 $ 53
----------------------------------------------------------
TOTAL BANKS 397
==========================================================
BUILDING & CONSTRUCTION [0.3%]
Hanson Australia Funding
5.250%, 03/15/13 50 49
==========================================================
CONTAINERS & PACKAGING [0.3%]
Pactiv
7.950%, 12/15/25 50 56
==========================================================
ENERGY [1.1%]
Dominion Resources, Ser B
6.250%, 06/30/12 50 52
Exelon Generation
6.950%, 06/15/11 50 52
Pacific Gas & Electric
6.050%, 03/01/34 25 25
PSI Energy
7.850%, 10/15/07 50 51
----------------------------------------------------------
TOTAL ENERGY 180
==========================================================
FINANCIAL SERVICES [0.4%]
Countrywide Financial
6.250%, 05/15/16 25 25
Household Finance
8.000%, 07/15/10 40 44
----------------------------------------------------------
TOTAL FINANCIAL SERVICES 69
==========================================================
FOOD, BEVERAGE & TOBACCO [0.2%]
Quaker Oats, Ser B, MTN
9.250%, 11/27/07 25 26
==========================================================
INSURANCE [0.6%]
MetLife
6.500%, 12/15/32 50 53
Protective Life
4.300%, 06/01/13 50 48
----------------------------------------------------------
TOTAL INSURANCE 101
==========================================================
MANUFACTURING [0.2%]
Tyco International Group
6.375%, 10/15/11 25 26
==========================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 19
schedule of investments
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA Balanced Fund (CONTINUED)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
PAPER & PAPER PRODUCTS [0.4%]
Westvaco
9.750%, 06/15/20 $ 50 $ 62
==========================================================
PETROLEUM & FUEL PRODUCTS [0.2%]
Pemex Project Funding Master Trust
9.125%, 10/13/10 25 28
==========================================================
REAL ESTATE INVESTMENT TRUST [0.2%]
Masco
6.125%, 10/03/16 25 25
==========================================================
TELEPHONES & TELECOMMUNICATIONS [0.5%]
Deutsche Telekom International Finance
8.250%, 06/15/30 25 31
GTE
6.840%, 04/15/18 25 27
New Cingular Wireless Services
8.750%, 03/01/31 25 32
----------------------------------------------------------
TOTAL TELEPHONES & TELECOMMUNICATIONS 90
==========================================================
TOTAL CORPORATE BONDS
(Cost $1,116) 1,134
======================================================
U.S. TREASURY OBLIGATIONS [6.5%]
U.S. Treasury Bonds
9.125%, 05/15/18 150 206
6.250%, 08/15/23 750 861
----------------------------------------------------------
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $1,076) 1,067
======================================================
U.S. GOVERNMENT AGENCY OBLIGATIONS [2.7%]
FNMA
6.000%, 05/15/11 (D) 250 261
5.500%, 04/01/36 182 180
----------------------------------------------------------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS
(Cost $437) 441
======================================================
DESCRIPTION FACE AMOUNT (000)/SHARES VALUE (000)
- ---------------------------------------------------------------
ASSET-BACKED SECURITIES [0.8%]
Residential Asset Securities,
Ser 2002-RS3, Cl AI5
5.572%, 06/25/32 $111 $ 111
Residential Asset Securities,
Ser 2004-KS5, Cl AI3 (A)
4.030%, 04/25/30 17 17
----------------------------------------------------------
TOTAL ASSET-BACKED SECURITIES
(Cost $131) 128
======================================================
FOREIGN GOVERNMENT BONDS [0.6%]
Hydro-Quebec, Ser FU
11.750%, 02/01/12 50 64
United Mexican States
9.875%, 02/01/10 25 28
----------------------------------------------------------
TOTAL FOREIGN GOVERNMENT BONDS
(Cost $94) 92
======================================================
MUNICIPAL BOND [0.1%]
Louisiana [0.1%]
Louisiana State, Tobacco Settlement
Financing Authority, Ser 2001A
6.360%, 05/15/25 25 25
==========================================================
TOTAL MUNICIPAL BOND
(Cost $25) 25
======================================================
COMMERCIAL PAPER [2.0%]
Manhattan Asset Funding (E) (F)
5.300%, 04/02/07 323 323
==========================================================
TOTAL COMMERCIAL PAPER
(Cost $323) 323
======================================================
CASH EQUIVALENTS [0.9%]
AIM Short-Term Investment
Company Liquid Assets
Portfolio (E) 15,177 15
Fidelity Institutional Domestic
Money Market Portfolio,
Cl I, 5.17% (C) 127,054 127
----------------------------------------------------------
TOTAL CASH EQUIVALENTS
(Cost $142) 142
======================================================
TOTAL INVESTMENTS [101.7%]
(Cost $16,096) $16,630
======================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 20
schedule of investments
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA Balanced Fund (concluded)
DESCRIPTION
- ---------------------------------------------------------------
PERCENTAGES BASED ON NET ASSETS OF $16,349 ($ THOUSANDS).
* NON-INCOME PRODUCING SECURITY
(A) FLOATING RATE SECURITY -- THE RATE REFLECTED ON THE SCHEDULE OF INVESTMENTS
IS THE RATE IN EFFECT ON MARCH 31, 2007.
(B) STEP BOND -- THE RATE REFLECTED ON THE SCHEDULE OF INVESTMENTS IS THE RATE
IN EFFECT ON MARCH 31, 2007. THE COUPON ON A STEP BOND CHANGES ON A SPECIFIC
DATE.
(C) RATE SHOWN IS THE 7-DAY EFFECTIVE YIELD AS OF MARCH 31, 2007.
(D) THIS SECURITY OR A PARTIAL POSITION OF THIS SECURITY IS ON LOAN AT MARCH 31,
2007. THE TOTAL VALUE OF SECURITIES ON LOAN AT MARCH 31, 2007 WAS $321,167.
(E) THIS SECURITY WAS PURCHASED WITH CASH COLLATERAL RECEIVED FROM SECURITIES
LENDING. THE TOTAL VALUE OF SUCH SECURITIES AT MARCH 31, 2007 WAS $338,264.
(F) RATE SHOWN IS THE 7-DAY EFFECTIVE YIELD AT TIME OF PURCHASE.
CL -- CLASS
CMO -- COLLATERALIZED MORTGAGE OBLIGATION
FHLMC -- FEDERAL HOME LOAN MORTGAGE CORPORATION
FNMA -- FEDERAL NATIONAL MORTGAGE ASSOCIATION
LLC -- LIMITED LIABILITY COMPANY
MTN -- MEDIUM TERM NOTE
NA -- NATIONAL ASSOCIATION
REMIC -- REAL ESTATE MORTGAGE INVESTMENT CONDUIT
SER -- SERIES
AMOUNTS DESIGNATED AS "--" ARE EITHER $0 OR HAVE BEEN ROUNDED TO $0.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 21
schedule of investments
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA Diversified Equity Fund
[Bar Chart Omitted]
Plot points are as follows:
SECTOR WEIGHTINGS*:
95.0% Common Stock
3.0% Cash Equivalents
2.0% Commercial Paper
*Percentages based on total investments.
- ---------------------------------------------------------------
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------------
COMMON STOCK [97.2%]
Advertising [0.5%]
CBS, Cl B 18,800 $ 575
==========================================================
AEROSPACE & DEFENSE [1.7%]
Lockheed Martin 7,173 696
Raytheon 6,000 315
United Technologies 12,360 803
----------------------------------------------------------
TOTAL AEROSPACE & DEFENSE 1,814
==========================================================
AIR TRANSPORTATION [0.9%]
FedEx 9,500 1,021
==========================================================
APPAREL/TEXTILES [0.2%]
VF 3,190 264
==========================================================
Automotive [1.4%]
Autozone* 2,590 332
Honda Motor, ADR 21,500 750
Paccar 5,485 402
----------------------------------------------------------
TOTAL AUTOMOTIVE 1,484
==========================================================
BANKS [7.1%]
Bank of America 45,680 2,331
International Bancshares 9,500 282
JPMorgan Chase 41,690 2,017
National City 5,102 190
PNC Financial Services Group 7,033 506
US Bancorp 24,600 860
Washington Mutual 16,243 656
Wells Fargo 26,596 916
----------------------------------------------------------
TOTAL BANKS 7,758
==========================================================
BIOMEDICAL RESEARCH & PRODUCTS [0.5%]
Quest Diagnostic (A) 10,200 509
==========================================================
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------------
BROADCASTING & CABLE [2.5%]
Cisco Systems* 31,122 $ 794
Motorola 66,384 1,173
Nokia, ADR 34,500 791
----------------------------------------------------------
TOTAL BROADCASTING & CABLE 2,758
==========================================================
BUILDING & CONSTRUCTION [0.4%]
Lennar, Cl A 5,228 221
USG* 4,200 196
----------------------------------------------------------
TOTAL BUILDING & CONSTRUCTION 417
==========================================================
BUSINESS SERVICES [1.9%]
Convergys* 10,300 262
First Data 22,600 608
Omnicom Group 3,400 348
Xerox* 52,666 889
----------------------------------------------------------
TOTAL BUSINESS SERVICES 2,107
==========================================================
CHEMICALS [0.4%]
Eastman Chemical 3,898 247
Hercules* 10,823 211
----------------------------------------------------------
TOTAL CHEMICALS 458
==========================================================
COMMERCIAL BANKS [0.8%]
Bank of New York 22,600 916
==========================================================
COMMUNICATION & MEDIA [2.3%]
DIRECTV Group* 15,739 363
Time Warner 110,325 2,176
----------------------------------------------------------
TOTAL COMMUNICATION & MEDIA 2,539
==========================================================
COMPUTERS-HARDWARE [3.0%]
Hewlett-Packard 52,841 2,121
IBM 11,716 1,104
----------------------------------------------------------
TOTAL COMPUTERS-HARDWARE 3,225
==========================================================
COMPUTERS-SOFTWARE [1.5%]
Microsoft 20,020 558
Oracle* 60,063 1,089
----------------------------------------------------------
TOTAL COMPUTERS-SOFTWARE 1,647
==========================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 22
schedule of investments
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA Diversified Equity Fund (CONTINUED)
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------------
COMPUTER SYSTEM DESIGN & SERVICES [1.0%]
Lexmark International, Cl A* 3,894 $ 228
Seagate Technology 23,700 552
Sun Microsystems* 55,000 330
----------------------------------------------------------
TOTAL COMPUTERS SYSTEM DESIGN & SERVICES 1,110
==========================================================
CONSUMER PRODUCTS & SERVICES [1.9%]
Kimberly-Clark 4,400 301
Mattel 27,900 769
Procter & Gamble 4,615 292
Sony, ADR 13,000 656
----------------------------------------------------------
TOTAL CONSUMER PRODUCTS & SERVICES 2,018
==========================================================
CONTAINERS & PACKAGING [0.2%]
Pactiv* 7,700 260
==========================================================
DATA PROCESSING [0.3%]
Electronic Data Systems 10,600 293
==========================================================
DIVERSIFIED MANUFACTURING [2.5%]
Danaher 4,836 345
General Electric 52,090 1,842
Parker Hannifin 6,650 574
----------------------------------------------------------
TOTAL DIVERSIFIED MANUFACTURING 2,761
==========================================================
DIVERSIFIED METALS & MINING [0.8%]
Dell* 23,000 534
Freeport-McMoran Copper & Gold, Cl B 5,250 348
----------------------------------------------------------
TOTAL DIVERSIFIED METALS & MINING 882
==========================================================
DRUG STORES [0.7%]
Rite Aid (A)* 137,500 793
==========================================================
DRUGS [6.7%]
Abbott Laboratories 12,000 670
Johnson & Johnson 28,710 1,730
King Pharmaceuticals* 30,000 590
Merck 21,239 938
Pfizer 49,169 1,242
Sanofi-Aventis, ADR 6,000 261
Schering-Plough 24,300 620
Wyeth 24,853 1,243
----------------------------------------------------------
TOTAL DRUGS 7,294
==========================================================
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------------
ELECTRICAL SERVICES [1.5%]
Centerpoint Energy 12,992 $ 233
DTE Energy 5,131 246
Duke Energy 25,584 519
Pinnacle West Capital 4,535 219
TXU 1,866 120
Xcel Energy 10,104 249
----------------------------------------------------------
TOTAL ELECTRICAL SERVICES 1,586
==========================================================
ENERGY [0.9%]
Entergy 2,660 279
PG&E 7,128 344
Sempra Energy 5,341 326
----------------------------------------------------------
TOTAL ENERGY 949
==========================================================
ENTERTAINMENT [0.3%]
Carnival 7,023 329
==========================================================
FINANCIAL SERVICES [5.4%]
American Express 2,131 120
Capital One Financial 13,000 981
CIT Group 31,980 1,692
Citigroup 46,891 2,408
Countrywide Financial 13,650 459
Western Union* 12,600 277
----------------------------------------------------------
TOTAL FINANCIAL SERVICES 5,937
==========================================================
FOOD, BEVERAGE & TOBACCO [4.5%]
Coca-Cola Enterprises 38,500 780
Conagra Foods 26,000 648
Del Monte Foods 37,300 428
General Mills 8,070 470
Kellogg 3,619 186
Pepsi Bottling Group 7,370 235
PepsiCo 15,316 973
Safeway 31,820 1,166
----------------------------------------------------------
TOTAL FOOD, BEVERAGE & TOBACCO 4,886
==========================================================
GAS/NATURAL GAS [0.8%]
El Paso 59,500 861
==========================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 23
schedule of investments
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA Diversified Equity Fund (CONTINUED)
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------------
HEALTHCARE PRODUCTS & SERVICES [1.8%]
Applera - Applied Biosystems
Group 15,616 $ 462
Cardinal Health 12,900 941
Cigna 2,058 294
McKesson 5,400 316
----------------------------------------------------------
TOTAL HEALTHCARE PRODUCTS & SERVICES 2,013
==========================================================
HOUSEHOLD FURNITURE & FIXTURES [0.5%]
Ethan Allen Interiors 15,400 544
==========================================================
INSURANCE [10.0%]
ACE 8,434 481
Allstate 24,749 1,486
American International Group 19,493 1,310
Chubb 21,356 1,103
Conseco* 34,600 599
Genworth Financial, Cl A 9,030 316
Hartford Financial Services Group 6,506 622
HCC Insurance 28,500 878
ING Groep, ADR 16,222 687
Lincoln National 5,624 381
Marsh & Mclennan 26,800 785
Mercury General 4,500 239
Metlife 3,500 221
Torchmark 3,188 209
Travelers 15,970 827
UnumProvident 26,500 610
XL Capital, Cl A 2,237 156
----------------------------------------------------------
TOTAL INSURANCE 10,910
==========================================================
INVESTMENT BANKER/BROKER DEALER [1.5%]
Goldman Sachs Group 4,369 903
Morgan Stanley 9,340 735
----------------------------------------------------------
TOTAL INVESTMENT BANKER/BROKER DEALER 1,638
==========================================================
MACHINERY [1.3%]
Caterpillar 11,400 764
Cummins 2,348 340
Eaton 3,690 308
----------------------------------------------------------
TOTAL MACHINERY 1,412
==========================================================
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------------
MEDICAL PRODUCTS & SERVICES [1.5%]
Baxter International 4,300 $ 226
Becton Dickinson 5,680 437
Health Management, Cl A 11,200 122
Laboratory* 1,353 98
Wellpoint* 9,034 733
----------------------------------------------------------
TOTAL MEDICAL PRODUCTS & SERVICES 1,616
==========================================================
METALS & MINING [0.8%]
Barrick Gold 28,600 817
==========================================================
MISCELLANEOUS MANUFACTURING [1.1%]
Tyco International 36,654 1,156
==========================================================
MULTI-MEDIA [0.8%]
Walt Disney 24,393 840
==========================================================
OFFICE FURNITURE & FIXTURES [0.1%]
VeriSign* 4,879 122
==========================================================
PAPER & RELATED PRODUCTS [0.6%]
International Paper 9,269 337
MeadWestvaco 9,000 278
----------------------------------------------------------
TOTAL PAPER & RELATED PRODUCTS 615
==========================================================
PETROLEUM & FUEL PRODUCTS [9.7%]
Anadarko Petroleum 20,400 877
Apache 6,724 475
Ashland 3,502 230
Baker Hughes 6,543 433
Chesapeake Energy (A) 37,068 1,145
ChevronTexaco 25,144 1,860
ConocoPhillips 24,496 1,674
Ensco International 2,745 149
Exxon Mobil 16,277 1,228
Marathon Oil 6,983 690
Nabors Industries* 30,032 891
Unit* 11,100 561
Valero Energy 5,100 329
----------------------------------------------------------
TOTAL PETROLEUM & FUEL PRODUCTS 10,542
==========================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 24
schedule of investments
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA Diversified Equity Fund (CONTINUED)
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------------
PETROLEUM REFINING [0.3%]
Hess 5,489 $ 305
==========================================================
PETROLEUM EXPLORATION [0.7%]
GlobalSantaFe 12,900 796
==========================================================
PRINTING & PUBLISHING [1.0%]
Gannett 14,271 803
McGraw Hill 3,825 241
Meredith 1,080 62
Tribune 722 23
----------------------------------------------------------
TOTAL PRINTING & PUBLISHING 1,129
==========================================================
RAILROADS [0.3%]
CSX 8,874 355
==========================================================
REAL ESTATE INVESTMENT TRUSTS [0.4%]
Boston Properties 1,565 184
Temple-Inland 3,847 230
----------------------------------------------------------
TOTAL REAL ESTATE INVESTMENT TRUSTS 414
==========================================================
RECREATION [0.2%]
Hasbro 7,993 229
----------------------------------------------------------
DESCRIPTION SHARES/FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
SEMI-CONDUCTORS [2.0%]
Applied Materials 44,381 $ 813
Infineon Technologies, ADR* 29,300 456
Intel 5,840 112
Novellus Systems* 5,723 183
Teradyne* 14,429 239
Texas Instruments 13,582 409
----------------------------------------------------------
TOTAL SEMI-CONDUCTORS 2,212
==========================================================
RESIDENTIAL HOUSING [0.2%]
DR Horton 10,349 228
Pulte Homes 349 9
----------------------------------------------------------
TOTAL RESIDENTIAL HOUSING 237
==========================================================
RETAIL [2.9%]
Big Lots* 1,153 36
Dillard's, Cl A 6,502 213
JC Penney 5,080 417
Kroger 15,960 451
Limited Brands 10,400 271
Lowe's 12,882 405
Sherwin Williams 2,435 161
TJX 9,100 245
Wal-Mart Stores 11,900 559
Zale* 15,000 396
----------------------------------------------------------
TOTAL RETAIL 3,154
==========================================================
STEEL & STEEL WORKS [0.7%]
Nucor 7,161 467
United States Steel 3,341 331
----------------------------------------------------------
TOTAL STEEL & STEEL WORKS 798
==========================================================
TELEPHONES & TELECOMMUNICATIONS [5.6%]
AT&T 34,891 1,376
Avaya* 920 11
Embarq 5,430 306
Idearc 44,275 1,554
Sprint Nextel 47,000 891
Telephone & Data Systems 9,800 584
Verizon Communications 35,675 1,353
----------------------------------------------------------
TOTAL TELEPHONES & TELECOMMUNICATIONS 6,075
==========================================================
TRUCKING [0.2%]
Ryder System 5,080 251
==========================================================
WHOLESALE [0.4%]
Sysco 11,500 389
==========================================================
TOTAL COMMON STOCK
(Cost $97,741) 106,020
======================================================
COMMERCIAL PAPER [2.0%]
Manhattan Asset Funding (B) (D)
5.300%, 04/02/07 $2,173 2,173
==========================================================
TOTAL COMMERCIAL PAPER
(Cost $2,173) 2,173
======================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 25
schedule of investments
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA Diversified Equity Fund (CONCLUDED)
CASH EQUIVALENTS [3.1%]
AIM Short-Term Investment
Company Liquid Assets
Portfolio (B) 102,051 $ 102
Fidelity Institutional Domestic
Money Market Portfolio,
Cl I, 5.17% (C) 3,233,627 3,234
----------------------------------------------------------
TOTAL CASH EQUIVALENTS
(Cost $3,336) 3,336
=====================================================
TOTAL INVESTMENTS [102.3%]
(Cost $103,250) $111,529
=====================================================
PERCENTAGES BASED ON NET ASSETS OF $108,989 ($ THOUSANDS).
* NON-INCOME PRODUCING SECURITY
(A) THIS SECURITY OR A PARTIAL POSITION OF THIS SECURITY IS ON LOAN AT MARCH 31,
2007. THE TOTAL VALUE OF SECURITIES ON LOAN AT MARCH 31, 2007 WAS
$2,151,076.
(B) THIS SECURITY WAS PURCHASED WITH CASH COLLATERAL RECEIVED FROM SECURITIES
LENDING. THE TOTAL VALUE OF SUCH SECURITIES AT MARCH 31, 2007 WAS
$2,274,477.
(C) THE RATE SHOWN IS THE 7-DAY EFFECTIVE YIELD AS OF MARCH 31, 2007.
(D) RATE SHOWN IS THE 7-DAY EFFECTIVE YIELD AT TIME OF PURCHASE.
ADR -- AMERICAN DEPOSITARY RECEIPT
CL -- CLASS
LLC -- LIMITED LIABILITY COMPANY
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 26
schedule of investments
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA Socially Responsible Equity Fund
[Bar Chart Omitted]
Plot points are as follows:
SECTOR WEIGHTINGS*:
90.2% Common Stock
6.4% Cash Equivalent
3.4% Commercial Paper
*Percentages based on total investments.
- ---------------------------------------------------------------
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------------
COMMON STOCK [94.6%]
ADVERTISING [2.0%]
CBS, Cl B 34,500 $ 1,055
==========================================================
AUTOMOTIVE [2.7%]
Honda Motor, ADR 41,900 1,461
==========================================================
BANKS [8.2%]
Chittenden 25,500 770
International Bancshares 42,325 1,256
National City 34,100 1,270
PNC Financial Services Group 14,800 1,065
----------------------------------------------------------
TOTAL BANKS 4,361
==========================================================
BIOMEDICAL RESEARCH & PRODUCTS [1.7%]
Quest Diagnostic (A) 18,000 898
==========================================================
BROADCASTING & CABLE [2.5%]
Nokia, ADR 57,500 1,318
==========================================================
BUSINESS SERVICES [2.7%]
Xerox* 85,400 1,442
==========================================================
CHEMICALS [4.5%]
Air Products & Chemicals 14,200 1,050
Rohm & Haas 26,100 1,350
----------------------------------------------------------
TOTAL CHEMICALS 2,400
==========================================================
CABLE/MEDIA [2.6%]
Time Warner 69,000 1,361
==========================================================
COMPUTER SYSTEM DESIGN & SERVICES [1.0%]
Sun Microsystems* 87,000 523
==========================================================
COMPUTERS-HARDWARE [2.8%]
Hewlett-Packard 37,500 1,505
==========================================================
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------------
CONSUMER PRODUCTS & SERVICES [7.4%]
Kimberly-Clark 24,000 $ 1,644
Mattel 47,500 1,310
Sony, ADR 19,200 969
----------------------------------------------------------
TOTAL CONSUMER PRODUCTS & SERVICES 3,923
==========================================================
DRUGS [7.4%]
Abbott Laboratories 25,300 1,412
Johnson & Johnson 23,500 1,416
Schering-Plough 44,600 1,138
----------------------------------------------------------
TOTAL DRUGS 3,966
==========================================================
ELECTRICAL SERVICES [3.0%]
Emerson Electric 36,900 1,590
==========================================================
ENERGY [2.8%]
Atmos Energy 48,500 1,517
==========================================================
FINANCIAL SERVICES [5.7%]
CIT Group 20,200 1,069
Citigroup 28,000 1,438
Nasdaq Stock Market* 18,000 529
----------------------------------------------------------
TOTAL FINANCIAL SERVICES 3,036
==========================================================
FOOD, BEVERAGE & TOBACCO [4.2%]
Del Monte Foods 90,000 1,033
Supervalu 30,100 1,176
----------------------------------------------------------
TOTAL FOOD, BEVERAGE & TOBACCO 2,209
==========================================================
HEALTHCARE PRODUCTS & SERVICES [3.9%]
Applera - Applied Biosystems
Group 33,000 976
Cardinal Health 15,000 1,094
----------------------------------------------------------
TOTAL HEALTHCARE PRODUCTS & SERVICES 2,070
==========================================================
INSURANCE [6.1%]
American International Group 14,000 941
Marsh & McLennan 18,000 527
Mercury General 18,200 965
Metlife 12,500 790
----------------------------------------------------------
TOTAL INSURANCE 3,223
==========================================================
MISCELLANEOUS MANUFACTURING [1.9%]
Tyco International 32,500 1,025
==========================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 27
schedule of investments
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA Socially Responsible Equity Fund (concluded)
DESCRIPTION SHARES/FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
OFFICE FURNITURE & FIXTURES [1.8%]
3M 12,800 $ 978
==========================================================
PAPER & PAPER PRODUCTS [2.3%]
MeadWestvaco 40,000 1,234
==========================================================
PETROLEUM & FUEL PRODUCTS [7.6%]
Chesapeake Energy (A) 57,800 1,785
Patterson - UTI Energy 34,000 763
Unit Corp.* 29,500 1,492
----------------------------------------------------------
TOTAL PETROLEUM & FUEL PRODUCTS 4,040
==========================================================
PRINTING & PUBLISHING [4.1%]
Lee Enterprises 31,000 932
Thomson 29,600 1,230
----------------------------------------------------------
TOTAL PRINTING & PUBLISHING 2,162
==========================================================
SEMI-CONDUCTORS/INSTRUMENTS [1.7%]
Intel 47,500 909
==========================================================
TELEPHONES & TELECOMMUNICATIONS [4.0%]
Embarq 10,800 609
Sprint Nextel 80,500 1,526
----------------------------------------------------------
TOTAL TELEPHONES & TELECOMMUNICATIONS 2,135
==========================================================
TOTAL COMMON STOCK
(Cost $45,072) 50,341
======================================================
COMMERCIAL PAPER [3.6%]
MANHATTAN ASSET FUNDING (B) (D)
5.300%, 04/02/07 $1,892 1,892
----------------------------------------------------------
TOTAL COMMERCIAL PAPER
(Cost $1,892) 1,892
======================================================
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------------
CASH EQUIVALENTS [6.7%]
AIM Short-Term Investment
Company Liquid Assets
Portfolio (B) 88,848 $ 89
Fidelity Institutional Domestic
Money Market Portfolio,
Cl I, 5.17% (C) 3,501,710 3,502
----------------------------------------------------------
TOTAL CASH EQUIVALENTS
(Cost $3,591) 3,591
======================================================
TOTAL INVESTMENTS [104.9%]
(Cost $50,555) $55,824
======================================================
PERCENTAGES BASED ON NET ASSETS OF $53,228 ($ THOUSANDS).
* NON-INCOME PRODUCING SECURITY
(A) THIS SECURITY OR A PARTIAL POSITION OF THIS SECURITY IS ON LOAN AT MARCH 31,
2007. THE TOTAL VALUE OF SUCH SECURITIES AT MARCH 31, 2007 WAS $1,870,235.
(B) THIS SECURITY WAS PURCHASED WITH CASH COLLATERAL RECEIVED FROM SECURITIES
LENDING. THE VALUE OF SUCH SECURITIES AT MARCH 31, 2007 WAS $1,980,218.
(C) THE RATE SHOWN IS THE 7-DAY EFFECTIVE YIELD AS OF MARCH 31, 2007.
(D) RATE SHOWN IS THE 7-DAY EFFECTIVE YIELD AT TIME OF PURCHASE.
ADR -- AMERICAN DEPOSITARY RECEIPT
CL -- CLASS
LLC -- LIMITED LIABILITY COMPANY
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 28
statements of assets and liabilities (000)
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA AHA AHA
Limited Full AHA Socially
Maturity Maturity AHA Diversified Responsible
Fixed Income Fixed Income Balanced Equity Equity
Fund Fund Fund Fund Fund
------------------------------------------------------------------------------
ASSETS:
Cost of securities $ 42,761 $ 39,777 $ 16,096 $ 103,250 $ 50,555
- ------------------------------------------------------------------------------------------------------------------------------------
Investments in securities at value $ 42,765 $ 39,913(1) $ 16,630(2) $ 111,529(3) $ 55,824(4)
Cash -- -- 1 4 6
Income receivable 399 406 67 139 64
Receivable for capital shares sold -- -- -- 3 139
Receivable for investment securities sold -- -- 1,002 5,168 425
Receivable for dividend tax reclaim -- -- 1 2 --
Prepaid Expenses 24 6 3 14 2
- ------------------------------------------------------------------------------------------------------------------------------------
Total Assets 43,188 40,325 17,704 116,859 56,460
- ------------------------------------------------------------------------------------------------------------------------------------
LIABILITIES:
Obligation to return securities
lending collateral -- 1,288 338 2,275 1,981
Payable for investment securities
purchased -- -- 999 5,401 1,208
Payable due to Custodian 2 -- -- -- --
Income distribution payable 119 86 -- -- --
Payable for capital shares redeemed -- -- -- 59 --
Investment adviser fees payable 18 19 11 72 31
Distribution fees payable 1 -- 1 29 --
Administrative fees payable 2 2 1 5 2
Other accrued expenses 24 10 5 29 10
- ------------------------------------------------------------------------------------------------------------------------------------
Total Liabilities 166 1,405 1,355 7,870 3,232
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSETS $ 43,022 $ 38,920 $ 16,349 $ 108,989 $ 53,228
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSETS:
Paid-in-Capital
(unlimited authorization --
$0.01 par value) $ 45,513 $ 39,171 $ 15,322 $ 92,448 $ 47,274
Undistributed net investment income 7 4 10 14 10
Accumulated net realized gain (loss)
on investments (2,502) (391) 483 8,248 675
Net unrealized appreciation on investments 4 136 534 8,279 5,269
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSETS $ 43,022 $ 38,920 $ 16,349 $ 108,989 $ 53,228
- ------------------------------------------------------------------------------------------------------------------------------------
Institutional Shares:
Net Assets $42,745,869 $38,730,231 $16,349,288 $98,672,049 $52,548,898
Total shares outstanding at end of year 4,037,281 3,800,587 1,829,447 5,572,189 4,510,431
Net asset value, offering and
redemption price per share
(net assets / shares outstanding) $ 10.59 $ 10.19 $ 8.94 $ 17.71 $ 11.65
Class A Shares:
Net Assets $ 276,575 $ 189,463 n/a $10,317,019 $ 678,738
Total shares outstanding at end of year 26,088 18,587 n/a 581,249 58,325
Net asset value, offering and
redemption price per share
(net assets / shares outstanding) $ 10.60 $ 10.19 n/a $ 17.75 $ 11.64
(1) MARKET VALUE OF SECURITIES ON LOAN WAS $1,224,907 AS OF MARCH 31, 2007.
(2) MARKET VALUE OF SECURITIES ON LOAN WAS $321,167 AS OF MARCH 31, 2007.
(3) MARKET VALUE OF SECURITIES ON LOAN WAS $2,151,076 AS OF MARCH 31, 2007.
(4) MARKET VALUE OF SECURITIES ON LOAN WAS $1,870,235 AS OF MARCH 31, 2007.
See accompanying notes to financial statements.
AHA INVESTMENT FUNDS | PAGE 29
statements of operations
FOR THE SIX MONTHS ENDED MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
AHA Limited Maturity Fixed AHA Full Maturity Fixed
Income Fund Income Fund AHA Balanced Fund
(000) (000) (000)
---------------------------------------------------------------------------
INVESTMENT INCOME:
Interest $1,061 $ 846 $ 166
Dividends 16 27 146
Income from Securities Lending -- Net 1 -- --
Foreign taxes withheld -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Investment Income 1,078 873 312
- ------------------------------------------------------------------------------------------------------------------------------------
EXPENSES:
Investment Advisory Fees 110 84 64
Administration Fees 12 9 5
Trustees' Fees and Expenses 1 1 --
Distribution Expense -- Class A Shares -- -- --
Transfer Agent Fees and Expenses 21 11 5
Custodian Fees and Expenses 6 3 2
Audit Fees 6 5 3
Reports to Shareholders 5 3 2
Registration Fees 1 1 --
Legal Fees 1 -- --
Insurance and Other Expenses 17 7 4
- ------------------------------------------------------------------------------------------------------------------------------------
Total Expenses 180 124 85
- ------------------------------------------------------------------------------------------------------------------------------------
Recovery of Investment Advisory Fees
Previously Waived(1) -- 13 1
Less Waiver of:
Investment Advisory Fees (3) -- --
Transfer Agent Fees (2) (2) (1)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Expenses 175 135 85
- ------------------------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME 903 738 227
- ------------------------------------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS:
Net Realized Gain (Loss) on Investments (49) 20 1,489
Change in Net Unrealized Appreciation
(Depreciation) on Investments 162 86 (884)
- ------------------------------------------------------------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED
GAIN ON INVESTMENTS 113 106 605
- ------------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $1,016 $ 844 $ 832
- ------------------------------------------------------------------------------------------------------------------------------------
AHA Socially Responsible
AHA Diversified Equity Fund Equity Fund
(000) (000)
---------------------------------------------------------------
INVESTMENT INCOME:
Interest $ -- $ --
Dividends 1,130 540
Income from Securities Lending -- Net 1 --
Foreign taxes withheld (1) (3)
- ------------------------------------------------------------------------------------------------------------------------------------
Total Investment Income 1,130 537
- ------------------------------------------------------------------------------------------------------------------------------------
EXPENSES:
Investment Advisory Fees 406 188
Administration Fees 29 13
Trustees' Fees and Expenses 2 1
Distribution Expense -- Class A Shares 14 1
Transfer Agent Fees and Expenses 37 12
Custodian Fees and Expenses 8 2
Audit Fees 17 8
Reports to Shareholders 11 9
Registration Fees 1 1
Legal Fees 1 1
Insurance and Other Expenses 21 6
- ------------------------------------------------------------------------------------------------------------------------------------
Total Expenses 547 242
- ------------------------------------------------------------------------------------------------------------------------------------
Recovery of Investment Advisory Fees
Previously Waived(1) 23 2
Less Waiver of:
Investment Advisory Fees (1) (6)
Transfer Agent Fees (5) (2)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Expenses 564 236
- ------------------------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME 566 301
- ------------------------------------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS:
Net Realized Gain (Loss) on Investments 9,892 737
Change in Net Unrealized Appreciation
(Depreciation) on Investments (3,329) 3,013
- ------------------------------------------------------------------------------------------------------------------------------------
Net Realized and Unrealized
Gain on Investments 6,563 3,750
- ------------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $7,129 $4,051
- ------------------------------------------------------------------------------------------------------------------------------------
(1) SEE NOTE 3 FOR ADVISORY FEES RECOVERED.
AMOUNTS DESIGNATED AS "--" ARE EITHER $0 OR HAVE BEEN ROUNDED TO $0.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 30 & 31
statements of changes in net assets
FOR THE SIX MONTHS ENDED MARCH 31, 2007 (UNAUDITED) AND THE YEAR ENDED SEPTEMBER 30, 2006
AHA Limited Maturity AHA Full Maturity AHA Balanced
Fixed Income Fund (000) Fixed Income Fund (000) Fund (000)
-------------------------------------------------------------------------
2007 2006(1) 2007 2006(2) 2007 2006(3)
OPERATIONS:
Net Investment Income $ 903 $ 2,434 $ 738 $ 1,288 $ 227 $ 327
Net Realized Gain (Loss) on Investments Sold (49) (1,507) 20 (314) 1,489 1,230
Change in Net Unrealized Appreciation
(Depreciation) on Investments 162 1,235 86 (122) (884) (133)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase in Net Assets
Resulting from Investment Operations 1,016 2,162 844 852 832 1,424
- ------------------------------------------------------------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:
Dividends to Shareholders from Net Investment Income:
Class I (897) (2,446) (734) (1,294) (227) (338)
Class A (5) (14) (3) (5) -- --
Distributions to Shareholders from Net Realized Gains:
Class I -- -- -- (179) (2,126) (1,084)
Class A -- -- -- (1) -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Dividends and Distributions to Shareholders (902) (2,460) (737) (1,479) (2,353) (1,422)
- ------------------------------------------------------------------------------------------------------------------------------------
FUND SHARE TRANSACTIONS:
Fund Share Transactions: Class I
Net Proceeds from Shares Sold 488 667 8,008 5,099 -- --
Reinvestment of Dividends 208 1,272 218 504 34 59
Cost of Shares Redeemed (3,403) (68,684) -- (6,345) -- (577)
- ------------------------------------------------------------------------------------------------------------------------------------
Total Fund Share Transactions Class I (2,707) (66,745) 8,226 (742) 34 (518)
- ------------------------------------------------------------------------------------------------------------------------------------
Fund Share Transactions: Class A
Net Proceeds from Shares Sold 25 167 43 13 -- --
Reinvestment of Dividends 5 14 3 6 -- --
Cost of Shares Redeemed (113) (643) (2) (5) -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Fund Share Transactions Class A (83) (462) 44 14 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets from
Capital Share Contributions (2,790) (67,207) 8,270 (728) 34 (518)
- ------------------------------------------------------------------------------------------------------------------------------------
Total Increase (Decrease) in Net Assets (2,676) (67,505) 8,377 (1,355) (1,487) (516)
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSETS:
Beginning of period 45,698 113,203 30,543 31,898 17,836 18,352
- ------------------------------------------------------------------------------------------------------------------------------------
End of period* $43,022 $ 45,698 $38,920 $30,543 $16,349 $17,836
====================================================================================================================================
*-Including Undistributed Net Investment Income of $ 7 $ 6 $ 4 $ 3 $ 10 $ 10
====================================================================================================================================
AHA Diversified AHA Socially Responsible
Equity Fund (000) Equity Fund (000)
- ------------------------------------------------------------------------------------------------------------------------------------
2007 2006(4) 2007 2006(5)
- ------------------------------------------------------------------------------------------------------------------------------------
OPERATIONS:
Net Investment Income $ 566 $ 871 $ 301 $ 273
Net Realized Gain (Loss) on Investments Sold 9,892 8,398 737 598
Change in Net Unrealized Appreciation
(Depreciation) on Investments (3,329) 628 3,013 1,277
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase in Net Assets
Resulting from Investment Operations 7,129 9,897 4,051 2,148
- ------------------------------------------------------------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:
Dividends to Shareholders from Net Investment Income:
Class I (531) (792) (302) (267)
Class A (43) (63) (2) (1)
Distributions to Shareholders from Net Realized Gains:
Class I (8,054) (3,919) (654) (102)
Class A (859) (440) (5) --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Dividends and Distributions to Shareholders (9,487) (5,214) (963) (370)
- ------------------------------------------------------------------------------------------------------------------------------------
FUND SHARE TRANSACTIONS:
Fund Share Transactions: Class I
Net Proceeds from Shares Sold 6,473 30,944 4,059 22,781
Reinvestment of Dividends 6,109 3,289 956 368
Cost of Shares Redeemed (6,372) (25,250) (537) (1,713)
- ------------------------------------------------------------------------------------------------------------------------------------
Total Fund Share Transactions Class I 6,210 8,983 4,478 21,436
- ------------------------------------------------------------------------------------------------------------------------------------
Fund Share Transactions: Class A
Net Proceeds from Shares Sold 804 1,789 444 263
Reinvestment of Dividends 889 456 7 1
Cost of Shares Redeemed (2,331) (1,034) (73) (4)
- ------------------------------------------------------------------------------------------------------------------------------------
Total Fund Share Transactions Class A (638) 1,211 378 260
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets from
Capital Share Contributions 5,572 10,194 4,856 21,696
- ------------------------------------------------------------------------------------------------------------------------------------
Total Increase (Decrease) in Net Assets 3,214 14,877 7,944 23,474
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSETS:
Beginning of period 105,775 90,898 45,284 21,810
- ------------------------------------------------------------------------------------------------------------------------------------
End of period* $108,989 $105,775 $53,228 $45,284
====================================================================================================================================
*-Including Undistributed Net Investment Income of $ 14 $ 22 $ 10 $ 13
====================================================================================================================================
(1) ON OCTOBER 3, 2005, THE LIMITED MATURITY FIXED INCOME FUND WAS REORGANIZED
INTO THE AHA LIMITED MATURITY FIXED INCOME FUND, A NEWLY ESTABLISHED
IDENTICAL SERIES OF THE CNI CHARTER FUNDS. SEE NOTE 1 IN NOTES TO FINANCIAL
STATEMENTS FOR MORE INFORMATION.
(2) ON OCTOBER 3, 2005, THE FULL MATURITY FIXED INCOME FUND WAS REORGANIZED INTO
THE AHA FULL MATURITY FIXED INCOME FUND, A NEWLY ESTABLISHED IDENTICAL
SERIES OF THE CNI CHARTER FUNDS. SEE NOTE 1 IN NOTES TO FINANCIAL STATEMENTS
FOR ADDITIONAL INFORMATION.
(3) ON OCTOBER 3, 2005, THE BALANCED FUND WAS REORGANIZED INTO THE AHA BALANCED
FUND, A NEWLY ESTABLISHED IDENTICAL SERIES OF THE CNI CHARTER FUNDS. SEE
NOTE 1 IN NOTES TO FINANCIAL STATEMENTS FOR ADDITIONAL INFORMATION.
(4) ON OCTOBER 3, 2005, THE DIVERSIFIED EQUITY FUND WAS REORGANIZED INTO THE AHA
DIVERSIFIED EQUITY FUND, A NEWLY ESTABLISHED IDENTICAL SERIES OF THE CNI
CHARTER FUNDS. SEE NOTE 1 IN NOTES TO FINANCIAL STATEMENTS FOR ADDITIONAL
INFORMATION.
(5) ON OCTOBER 3, 2005, THE SOCIALLY RESPONSIBLE EQUITY FUND WAS REORGANIZED
INTO THE AHA SOCIALLY RESPONSIBLE EQUITY FUND, A NEWLY ESTABLISHED IDENTICAL
SERIES OF THE CNI CHARTER FUNDS. SEE NOTE 1 IN NOTES TO FINANCIAL STATEMENTS
FOR ADDITIONAL INFORMATION.
AMOUNTS DESIGNATED AS "--" ARE EITHER $0 OR HAVE BEEN ROUNDED TO $0.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 32 & 33
<page>
financial highlights
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
FOR THE SIX MONTHS ENDED MARCH 31,2007 (UNAUDITED) AND THE YEAR OR PERIOD ENDED SEPTEMBER 30, (UNLESS OTHERWISE INDICATED)
- ----------------------------------------------------------------------------------------------------------------------------------
RATIO
OF NET
NET OPERATING
NET REALIZED AND NET NET EXPENSES
ASSET UNREALIZED DIVIDENDS DISTRIBUTIONS ASSET ASSETS TO AVERAGE
VALUE NET GAINS (LOSSES) FROM NET FROM VALUE END NET ASSETS
BEGINNING INVESTMENT ON INVESTMENT REALIZED END TOTAL OF PERIOD BEFORE
OF PERIOD INCOME(1)(6) INVESTMENTS(1)(6) INCOME GAINS OF PERIOD RETURN(2) (000) WAIVERS(3)(4)(6)
- ----------------------------------------------------------------------------------------------------------------------------------
AHA Limited Maturity Fixed Income Fund
Class I (commenced operations on December 22,1988)
2007* $10.56 $ 0.22 $ 0.03 $(0.22) $ -- $10.59 2.36% $ 42,746 0.82%
2006^ 10.57 0.34 0.02 (0.37) -- 10.56 3.49 45,340 0.94
For the period July 1, through September 30,
2005+ 10.61 0.06 (0.04) (0.06) -- 10.57 0.20(9) 112,381 0.88(10)
For the years ended June 30,
2005 10.68 0.22 (0.06) (0.22)(8) (0.01) 10.61 1.53 128,501 0.79
2004 10.86 0.18 (0.18) (0.18) -- 10.68 (0.05) 159,949 0.73
2003 10.65 0.28 0.21 (0.28) -- 10.86 4.65 96,605 0.83
2002 10.43 0.44 0.22 (0.44) -- 10.65 6.16 85,644 0.78
Class A (commenced operations on October 22, 2004)
2007* $10.57 $ 0.20 $ 0.03 $(0.20) $ -- $10.60 2.23% $ 276 1.06%
2006^ 10.58 0.30 0.03 (0.34) -- 10.57 3.17 358 1.18
For the period July 1, through September 30,
2005+ 10.62 0.05 (0.04) (0.05) -- 10.58 0.13(9) 822 1.11(10)
For the period October 22, 2004 through June 30,
2005 10.77 0.14 (0.13) (0.15)(8) (0.01) 10.62 0.12(9) 1,070 1.07(10)
- ----------------------------------------------------------------------------------------------------------------------------------
AHA Full Maturity Fixed Income Fund
Class I (commenced operations on October 20, 1988)
2007* $10.16 $ 0.22 $ 0.03 $(0.22) $ -- $10.19 2.45% $ 38,730 0.73%
2006^^ 10.35 0.43 (0.13) (0.43) (0.06) 10.16 3.03 30,398 0.87
For the period July 1, through September 30,
2005+ 10.50 0.09 (0.15) (0.09) -- 10.35 (0.57)(9) 31,764 0.83(10)
For the years ended June 30,
2005 10.39 0.38 0.20 (0.38) (0.09) 10.50 5.72 31,960 0.95
2004 10.87 0.36(11) (0.36) (0.39) (0.09) 10.39 0.08 28,958 0.98
2003 10.34 0.49 0.53 (0.49) -- 10.87 10.06 31,264 1.29
2002 10.10 0.52 0.24 (0.52) -- 10.34 7.40 38,267 1.08
Class A (commenced operations on May 11, 2004)
2007* $10.16 $ 0.20 $ 0.03 $(0.20) $ -- $10.19 2.32% $ 190 0.98%
2006^^ 10.36 0.40 (0.13) (0.41) (0.06) 10.16 2.67 145 1.12
For the period July 1, through September 30,
2005+ 10.50 0.08 (0.14) (0.08) -- 10.36 (0.54)(9) 134 1.08(10)
For the year ended June 30,
2005 10.39 0.34 0.22 (0.36) (0.09) 10.50 5.46 134 1.20
For the period May 11, through June 30,
2004 10.32 0.04 0.09 (0.06) -- 10.39 1.29(9) 104 1.15(10)
- ----------------------------------------------------------------------------------------------------------------------------------
AHA Balanced Fund
Class I (commenced operations on October 20, 1988)
2007* $ 9.77 $ 0.12 $ 0.33 $(0.12) $(1.16) $ 8.94 4.79% $ 16,349 1.00%
2006^^^ 9.76 0.18 0.59 (0.18) (0.58) 9.77 8.32 17,836 1.11
For the period July 1, through September 30,
2005+ 9.62 0.04 0.14 (0.04) -- 9.76 1.87(9) 18,352 1.10(10)
For the years ended June 30,
2005 8.98 0.16 0.64 (0.16) -- 9.62 8.97 18,088 1.25
2004 8.03 0.10(11) 0.97 (0.12) -- 8.98 13.41 16,930 1.31
2003 8.03 0.11 -- (0.11) -- 8.03 1.40 18,615 1.81
2002 9.17 0.12 (0.72) (0.12) (0.42) 8.03 (6.94) 23,375 1.64
- --------------------------------------------------------------------------------
RATIO
OF NET
OPERATING RATIO
EXPENSES OF NET
TO AVERAGE INVESTMENT
NET ASSETS PROGRAM INCOME PORTFOLIO
AFTER SERVICE TO AVERAGE TURNOVER
WAIVERS(3)(4)(6) FEE(4) NET ASSETS(3) RATE(7)
- --------------------------------------------------------------------------------
AHA Limited Maturity Fixed Income Fund
Class I (commenced operations on December 22,1988)
2007* 0.79% N/A 4.10% 55.31%
2006^ 0.75 N/A 3.24 86.31
For the period July 1, through September 30,
2005+ 0.86(10) N/A 2.20(10) 4.33(9)
For the years ended June 30,
2005 0.78 N/A 2.01 109.44
2004 0.73 N/A 1.65 97.66
2003 0.85 N/A 2.58 N/A
2002 0.76 0.13 4.00 60.24(5)
Class A (commenced operations on October 22, 2004)
2007* 1.04% N/A 3.85% 55.31%
2006^ 1.00 N/A 2.88 86.31
For the period July 1, through September 30,
2005+ 1.10(10) N/A 1.95(10) 4.33(9)
For the period October 22, 2004 through June 30,
2005 1.03(10) N/A 1.75(10) 109.44
- --------------------------------------------------------------------------------
AHA Full Maturity Fixed Income Fund
Class I (commenced operations on October 20, 1988)
2007* 0.80%** N/A 4.38% 30.38%
2006^^ 0.80** N/A 4.20 91.35
For the period July 1, through September 30,
2005+ 1.00(10)** N/A 3.37(10) 17.47(9
For the years ended June 30,
2005 1.00** N/A 3.58 144.07
2004 1.00** N/A 3.40 302.49
2003 1.00** N/A 4.51 N/A
2002 0.76** 0.17 5.09 99.46(5)
Class A (commenced operations on May 11, 2004)
2007* 1.05%** N/A 4.12% 30.38%
2006^^ 1.05** N/A 3.95 91.35
For the period July 1, through September 30,
2005+ 1.25(10)** N/A 3.12(10) 17.47(9)
For the year ended June 30,
2005 1.25** N/A 3.33 144.07
For the period May 11, through June 30,
2004 1.25(10)** N/A 3.27(10) 302.49(9)
- --------------------------------------------------------------------------------
AHA Balanced Fund
Class I (commenced operations on October 20, 1988)
2007* 1.00% N/A 2.65% 83.59%
2006^^^ 1.00 N/A 1.83 73.58
For the period July 1, through September 30,
2005+ 0.98(10) N/A 1.54(10) 13.53(9)
For the years ended June 30,
2005 1.20 N/A 1.69 98.60
2004 1.50 N/A 1.14 69.85
2003 1.50 N/A 1.43 N/A
2002 1.13 0.24 1.42 80.33(5)
+ THE FUND'S FISCAL AND TAX YEAR-END CHANGED FROM JUNE 30 TO SEPTEMBER 30.
^ ON OCTOBER 3, 2005, THE LIMITED MATURITY FIXED INCOME FUND WAS REORGANIZED
INTO THE AHA LIMITED MATURITY FIXED INCOME FUND, A NEWLY ESTABLISHED
IDENTICAL SERIES OF THE CNI CHARTER FUNDS. SEE NOTE 1 IN NOTES TO FINANCIAL
STATEMENTS FOR MORE INFORMATION.
^^ ON OCTOBER 3, 2005, THE FULL MATURITY FIXED INCOME FUND WAS REORGANIZED
INTO THE AHA FULL MATURITY FIXED INCOME FUND, A NEWLY ESTABLISHED IDENTICAL
SERIES OF THE CNI CHARTER FUNDS. SEE NOTE 1 IN NOTES TO FINANCIAL
STATEMENTS FOR MORE INFORMATION.
^^^ ON OCTOBER 3, 2005, THE BALANCED FUND WAS REORGANIZED INTO THE AHA BALANCED
FUND, A NEWLY ESTABLISHED IDENTICAL SERIES OF THE CNI CHARTER FUNDS. SEE
NOTE 1 IN NOTES TO FINANCIAL STATEMENTS FOR MORE INFORMATION.
* FOR THE SIX MONTHS ENDED MARCH 31, 2007.
** RATIO INCLUDES WAIVERS AND PREVIOUSLY WAIVED INVESTMENT ADVISORY FEES
RECOVERED. THE IMPACT OF THE RECOVERED FEES MAY CAUSE A HIGHER NET EXPENSE
RATIO.
(1) INFORMATION PRESENTED RELATES TO A SHARE OF CAPITAL STOCK OUTSTANDING FOR
THE ENTIRE PERIOD.
(2) TOTAL RETURN ON NET ASSET VALUE IS NET OF THE SERVICE FEE FOR THE PERIOD
JULY 1, 2001 THROUGH OCTOBER 31, 2001, AND FOR THE FISCAL YEAR ENDED 2001.
BEGINNING NOVEMBER 1, 2001 THE MANAGEMENT FEE IS INCLUDED IN THE
CALCULATION OF THE FUND'S NET ASSET VALUE.
(3) RATIOS INCLUDE ALL MANAGEMENT FEES AND EXPENSES EXCEPT FOR THE PROGRAM
SERVICE FEE.
(4) PROGRAM SERVICE FEE DISCONTINUED AS OF OCTOBER 31, 2001. EFFECTIVE NOVEMBER
1, 2001, THE ADVISOR EXPENSE RATIO IS INCLUDED AS A GENERAL OPERATING
EXPENSE OF THE FUND.
(5) RATE LISTED REPRESENTS THE PORTFOLIO TURNOVER RATE FROM JULY 1, 2001
THROUGH OCTOBER 31, 2001 (DATE ON WHICH FEEDER FUND ENTERED INTO A MASTER-
FEEDER FUND STRUCTURE).
(6) FOR THE PERIOD FROM NOVEMBER 1, 2001 THROUGH JUNE 30, 2003, THE PER SHARE
AMOUNTS AND PERCENTAGES REFLECT INCOME AND EXPENSES ASSUMING INCLUSION OF
THE FUND'S PROPORTIONATE SHARE OF THE INCOME AND EXPENSES OF ITS MASTER
PORTFOLIO.
(7) CALCULATED ON THE BASIS OF THE FUND AS A WHOLE WITHOUT DISTINGUISHING
BETWEEN THE CLASSES OF SHARES ISSUED. FOR PERIODS LESS THAN 1 YEAR,
PORTFOLIO TURNOVER RATE HAS NOT BEEN ANNUALIZED.
(8) INCLUDES A TAX RETURN OF CAPITAL WHICH IS LESS THAN $0.01 PER SHARE, FOR
THE FUND FOR THE YEAR ENDED JUNE 30, 2005.
(9) NOT ANNUALIZED.
(10) ANNUALIZED.
(11) NET INVESTMENT INCOME PER SHARE IS CALCULATED USING ENDING BALANCES PRIOR
TO CONSIDERATION OF ADJUSTMENTS FOR PERMANENT BOOK AND TAX DIFFERENCES.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 34
- ------------------------------------------------------------------------------------------------------------------------------------
RATIO
OF NET
NET OPERATING
NET REALIZED AND NET NET EXPENSES
ASSET UNREALIZED DIVIDENDS DISTRIBUTIONS ASSET ASSETS TO AVERAGE
VALUE NET GAINS (LOSSES) FROM NET FROM VALUE END NET ASSETS
BEGINNING INVESTMENT ON INVESTMENT REALIZED END TOTAL OF PERIOD BEFORE
OF PERIOD INCOME(1)(6) INVESTMENTS(1)(6) INCOME GAINS OF PERIOD RETURN(2) (000) WAIVERS(3)(4)(6)
- ------------------------------------------------------------------------------------------------------------------------------------
AHA Diversified Equity Fund
Class I (commenced operations on October 20, 1988)
2007* $18.17 $ 0.10 $ 1.12 $(0.10) $(1.58) $17.71 6.79% $98,672 0.99%
2006^ 17.42 0.15 1.55 (0.15) (0.80) 18.17 10.16 94,653 1.09
For the period July 1, through September 30,
2005+ 16.79 0.02 0.63 (0.02) -- 17.42 3.88(8) 81,447 1.08(9)
For the years ended June 30,
2005 15.39 0.13 1.40 (0.13) -- 16.79 9.95 81,510 1.07
2004 12.74 0.10 2.65 (0.10) -- 15.39 21.60 68,068 1.02
2003 13.08 0.08(6) (0.34)(6) (0.08) -- 12.74 (1.98) 55,564 1.18(6)
2002 15.90 0.10(6) (2.01)(6) (0.11) (0.80) 13.08 (12.75) 85,673 0.84(6)
Class A (commenced operations on December 30, 2002)
2007* $18.21 $ 0.07 $ 1.12 $(0.07) $(1.58) $17.75 6.64% $10,317 1.24%
2006^ 17.46 0.11 1.55 (0.11) (0.80) 18.21 9.87 11,122 1.34
For the period July 1, through September 30,
2005+ 16.83 0.01 0.63 (0.01) -- 17.46 3.81 (8)9,451 1.34(9)
For the years ended June 30,
2005 15.43 0.09 1.40 (0.09) -- 16.83 9.66 8,842 1.32
2004 12.75 0.06 2.65 (0.03) -- 15.43 21.24 7,392 1.27
For the period December 30, 2002, through June 30,
2003 11.48 0.03(10) 1.26(10) (0.02) -- 12.75 11.26(8) 6,454 1.45(9)(10)
- ------------------------------------------------------------------------------------------------------------------------------------
AHA Socially Responsible Equity Fund
Class I (commenced operations on January 3,
2005)
2007* $10.91 $ 0.07 $ 0.89 $(0.07) $(0.15) $11.65 8.86% $52,549 0.97%
2006^^ 10.28 0.12 0.67 (0.11) (0.05) 10.91 7.69 45,003 1.12
For the period July 1, through September 30,
2005+ 9.70 0.02 0.58 (0.02) -- 10.28 6.20(8) 21,795 1.24(9)
For the period January 3, through June 30,
2005 10.00 0.05 (0.30) (0.05) -- 9.70 (2.48)(8) 20,510 1.16(9)
Class A (commenced operations on August 12, 2005)
2007* $10.90 $ 0.06 $ 0.89 $(0.06) $(0.15) $11.64 8.75%$ 679 1.22%
2006^^ 10.28 0.09 0.67 (0.09) (0.05) 10.90 7.40 281 1.37
For the period August 12, through September 30,
2005 10.17 0.01 0.12 (0.02) -- 10.28 1.27(8) 15 1.69(9)
- --------------------------------------------------------------------------------
RATIO
OF NET
OPERATING RATIO
EXPENSES OF NET
TO AVERAGE INVESTMENT
NET ASSETS PROGRAM INCOME PORTFOLIO
AFTER SERVICE TO AVERAGE TURNOVER
WAIVERS(3)(4)(6) FEE(4) NET ASSETS(3) RATE(7)
- --------------------------------------------------------------------------------
AHA Diversified Equity Fund
Class I (commenced operations on October 20, 1988)
2007* 1.02% N/A 1.07% 73.43%
2006^ 1.01 N/A 0.87 99.16
For the period July 1, through September 30,
2005+ 1.13(9) N/A 0.46(9) 20.08(8)
For the years ended June 30,
2005 1.05 N/A 0.78 128.37
2004 1.02 N/A 0.67 97.51
2003 1.18(6) N/A 0.61(6) N/A
2002 0.84(6) 0.25 0.66(6) 29.13(5)
Class A (commenced operations on December 30, 200
2007* 1.27% N/A 0.81% 73.43%
2006^ 1.26 N/A 0.62 99.16
For the period July 1, through September 30,
2005+ 1.38(9) N/A 0.20(9) 20.08(8)
For the years ended June 30,
2005 1.30 N/A 0.53 128.37
2004 1.27 N/A 0.42 97.51
For the period December 30, 2002, through June 30
2003 1.45(9)(10) N/A 0.48(9)(10)N/A
- --------------------------------------------------------------------------------
AHA Socially Responsible Equity Fund
Class I (commenced operations on January 3, 2005)
2007* 0.94%** N/A 1.21% 9.16%
2006^^ 1.04** N/A 1.10 28.57
For the period July 1, through September 30,
2005+ 1.15(9)** N/A 0.09(9) 6.89(8)
For the period Januaryp 3, through June 30,
2005 1.12(9)** N/A 1.43(9) 47.56(8)
Class A (commenced operations on August 12, 2005)
2007* 1.19%** N/A 0.95% 9.16%
2006^^ 1.29** N/A 0.80 28.57
For the period August 12, through September 30,
2005 1.69(9) N/A 0.74(9) 6.89(8)
+ THE FUND'S FISCAL AND TAX YEAR-END CHANGED FROM JUNE 30 TO SEPTEMBER 30.
^ ON OCTOBER 3, 2005, THE DIVERSIFIED EQUITY FUND WAS REORGANIZED INTO THE
AHA DIVERSIFIED EQUITY FUND, A NEWLY ESTABLISHED IDENTICAL SERIES OF THE
CNI CHARTER FUNDS. SEE NOTE 1 IN NOTES TO FINANCIAL STATEMENTS FOR MORE
INFORMATION.
^^ ON OCTOBER 3, 2005, THE SOCIALLY RESPONSIBLE EQUITY FUND WAS REORGANIZED
INTO THE AHA SOCIALLY RESPONSIBLE EQUITY FUND, A NEWLY ESTABLISHED
IDENTICAL SERIES OF THE CNI CHARTER FUNDS. SEE NOTE 1 IN NOTES TO FINANCIAL
STATEMENTS FOR MORE INFORMATION.
* FOR THE SIX MONTHS ENDED MARCH 31, 2007.
** RATIO INCLUDES WAIVERS AND PREVIOUSLY WAIVED INVESTMENT ADVISORY FEES
RECOVERED. THE IMPACT OF THE RECOVERED FEES MAY CAUSE A HIGHER NET EXPENSE
RATIO.
(1) INFORMATION PRESENTED RELATES TO A SHARE OF CAPITAL STOCK OUTSTANDING FOR
THE ENTIRE PERIOD.
(2) TOTAL RETURN ON NET ASSET VALUE IS NET OF THE SERVICE FEE FOR THE PERIOD
JULY 1, 2001 THROUGH OCTOBER 31, 2001, AND FOR THE FISCAL YEAR ENDED 2001.
BEGINNING NOVEMBER 1, 2001 THE MANAGEMENT FEE IS INCLUDED IN THE
CALCULATION OF THE FUND'S NET ASSET VALUE.
(3) RATIOS INCLUDE ALL MANAGEMENT FEES AND EXPENSES EXCEPT FOR THE PROGRAM
SERVICE FEE.
(4) PROGRAM SERVICE FEE DISCONTINUED AS OF OCTOBER 31, 2001. EFFECTIVE NOVEMBER
1, 2001, THE ADVISOR EXPENSE RATIO IS INCLUDED AS A GENERAL OPERATING
EXPENSE OF THE FUND.
(5) RATE LISTED REPRESENTS THE PORTFOLIO TURNOVER RATE FROM JULY 1, 2001
THROUGH OCTOBER 31, 2001 (DATE ON WHICH FEEDER FUND ENTERED INTO A MASTER-
FEEDER FUND STRUCTURE).
(6) FOR THE PERIOD FROM NOVEMBER 1, 2001 THROUGH JUNE 30, 2003, THE PER SHARE
AMOUNTS AND PERCENTAGES REFLECT INCOME AND EXPENSES ASSUMING INCLUSION OF
THE FUND'S PROPORTIONATE SHARE OF THE INCOME AND EXPENSES OF ITS MASTER
PORTFOLIO.
(7) CALCULATED ON THE BASIS OF THE FUND AS A WHOLE WITHOUT DISTINGUISHING
BETWEEN THE CLASSES OF SHARES ISSUED. FOR PERIODS LESS THAN 1 YEAR,
PORTFOLIO TURNOVER RATE HAS NOT BEEN ANNUALIZED. (8) NOT ANNUALIZED.
(9) ANNUALIZED.
(10) FOR THE PERIOD FROM DECEMBER 30, 2002 THROUGH JUNE 30, 2003, THE PER SHARE
AMOUNTS AND PERCENTAGES REFLECT INCOME AND EXPENSES ASSUMING INCLUSION OF
THE FUND'S PROPORTIONATE SHARE OF THE INCOME AND EXPENSES OF ITS MASTER
PORTFOLIO.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
AHA INVESTMENT FUNDS | PAGE 35
notes to financial statements
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
1. ORGANIZATION
AHA Investment Funds (the "AHA Funds") are series of CNI Charter Funds (the
"Trust"), which is registered as an open-end management investment company under
the Investment Company Act of 1940. The Trust was organized as a business trust
under the laws of Delaware on October 28, 1996. Each of the AHA Funds commenced
operations on October 3, 2005, the effective date of the reorganization of each
corresponding series (each a "Predecessor Fund" and collectively the
"Predecessor Funds") of AHA Investment Funds, Inc. (the "AHA Company"), a
registered investment company organized on March 14, 1988 under the laws of
Maryland. On May 17, 2005, the Board of Directors of the AHA Company approved
the reorganization of the Predecessor Funds into the newly established
corresponding AHA Fund series of the Trust.
The AHA Funds currently offer the following series of shares: the AHA Limited
Maturity Fixed Income Fund ("Limited Maturity Fund"), the AHA Full Maturity
Fixed Income Fund ("Full Maturity Fund"), the AHA Balanced Fund ("Balanced
Fund"), the AHA Diversified Equity Fund (the "Diversified Fund"), the AHA
Socially Responsible Equity Fund (the "Socially Responsible Fund"), the AHA
International Core Equity Fund ("International Fund") and the AHA U.S.
Government Money Market Fund ("Money Market Fund") (each a "Fund" and,
collectively, the "Funds"). As of March 31, 2007, the International Fund and the
Money Market Fund had not commenced operations. The shares of common stock of
the Funds are divided into two classes: Class A Shares and Institutional Class
Shares. As of March 31, 2007, only the Institutional Class Shares of the
currently operating Funds and the Class A Shares of the Limited Maturity Fund,
the Full Maturity Fund, the Diversified Fund, and the Socially Responsible Fund
had commenced operations. To request a prospectus, shareholders can call
1-800-445-1341 or write to: CNI Charter Funds, c/o SEI Investments Distribution
Co., One Freedom Valley Drive, Oaks, Pennsylvania, 19456.
Expenses related to the reorganization and reimbursements to the Adviser for
reorganization related expenses were incurred and paid by the Funds. These
amounts are subject to recapture within the next three fiscal years.
The investment objectives of the Funds are set forth below.
LIMITED MATURITY FUND - Seeks a high level of current income, consistent with
preservation of capital and liquidity. Invests primarily in high quality fixed
income securities issued or guaranteed by the government, and maintains an
average dollar-weighted portfolio maturity of less than three years.
FULL MATURITY FUND - Seeks the highest level of income consistent with long-term
preservation of capital. Invests primarily in high quality fixed income
securities issued or guaranteed by the U.S. government, its agent or
instrumentalities. There is no restriction on the minimum or maximum maturity of
the securities purchased. The average dollar-weighted maturity will vary and may
exceed 20 years.
BALANCED FUND - Seeks a combination of growth of capital and income. Invests
varying proportions of its assets in equity and fixed income securities, with
not less than 25 percent of total assets invested in fixed income securities.
DIVERSIFIED FUND - Seeks long-term capital growth. Invests primarily in equity
securities of U.S. companies that are diversified among various industries and
market sectors and securities having equity characteristics.
SOCIALLY RESPONSIBLE FUND - Seeks long-term capital growth. Invests primarily in
equity securities whose issuers meet certain socially responsible criteria.
2. SIGNIFICANT ACCOUNTING POLICIES
USE OF ESTIMATES - The preparation of financial statements in conformity with
accounting principles generally accepted in the U.S. requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts of
increases and decreases in net assets from operations during the reporting
period. Actual results could differ from those estimates.
SECURITY VALUATION - Securities listed on a securities exchange, market or
automated quotation system for which quotations are readily available (except
for securities traded on NASDAQ) are valued at the last quoted sale price on the
primary exchange or market (foreign or domestic) on which they are traded, or,
if there is no such reported sale, at the most recent quoted bid price. For
securities traded on NASDAQ, the NASDAQ Official Closing Price will be used. If
available, debt securities are priced based upon valuations provided by
independent, third-party pricing agents. Such values generally reflect the last
reported sales price if the security is actively traded. The third-party pricing
agents may also value debt securities at an evaluated bid price by employing
methodologies that utilize actual market transactions, broker-supplied
valuations, or other methodologies designed to identify the market value for
such securities. Debt obligations with remaining maturities of sixty days or
less may be valued at their amortized cost, which approximates market value. The
prices
AHA INVESTMENT FUNDS | PAGE 36
- --------------------------------------------------------------------------------
for foreign securities are reported in local currency and converted to U.S.
dollars using currency exchange rates. Prices for most securities held in the
Funds are provided daily by recognized independent pricing agents. If a security
price cannot be obtained from an independent, third-party pricing agent, the
Funds seek to obtain a bid price from at least one independent broker.
Securities for which market prices are not "readily available" are valued in
accordance with Fair Value Procedures established by the Funds' Board of
Trustees. The Funds' Fair Value Procedures are implemented through a Fair Value
Committee (the "Committee") designated by the Funds' Board of Trustees. Some of
the more common reasons that may necessitate that a security be valued using
Fair Value Procedures include: the security's trading has been halted or
suspended; the security has been de-listed from a national exchange; the
security's primary trading market is temporarily closed at a time when under
normal conditions it would be open; for international securities, market events
occur after the close of the foreign markets that make closing prices not
representative of fair values; or the security's primary pricing source is not
able or willing to provide a price. When a security is valued in accordance with
the Fair Value Procedures, the Committee will determine the value after taking
into consideration relevant information reasonably available to the Committee.
SECURITY TRANSACTIONS AND RELATED INCOME - Security transactions are accounted
for on the trade date of the security purchase or sale. Costs used in
determining net realized capital gains and losses on the sale of securities are
those of the specific securities sold. Interest income is recognized on the
accrual basis and dividend income is recognized on the ex-dividend date.
Purchase discounts and premiums on securities held by the Funds are accreted and
amortized to maturity using the scientific method.
REPURCHASE AGREEMENTS - Securities pledged as collateral for repurchase
agreements are held by each Fund's custodian bank until maturity of the
repurchase agreements. Provisions of the agreements and procedures adopted by
the investment adviser require that the market value of the collateral,
including accrued interest thereon, is sufficient in the event of default by the
counterparty. The Funds also invest in tri-party repurchase agreements.
Securities held as collateral for tri-party repurchase agreements are maintained
by the broker's custodian bank in a segregated account until maturity of the
repurchase agreement. Provisions of the agreements require that the market value
of the collateral, including accrued interest thereon, is sufficient in the
event of default. If the counterparty defaults and the value of the collateral
declines or if the counterparty enters into an insolvency proceeding,
realization of the collateral by the Fund may be delayed or limited.
EXPENSE ALLOCATION - Common expenses incurred by the Funds are allocated among
the Funds (i) based upon relative average daily net assets,(ii) as incurred on a
specific identification basis, or (iii) equally among the Funds, depending on
the nature of the expenditure.
CLASSES - Class-specific expenses are borne by the class. Income, non
class-specific expenses, and realized and unrealized gains/losses are allocated
to the respective class on the basis of relative net asset value each day.
FUND DISTRIBUTIONS - The Limited Maturity Fund and the Full Maturity Fund
declare and pay income dividends from net investment income monthly.
In the Balanced Fund, the Diversified Fund and the Socially Responsible Fund,
dividends from net investment income are declared and paid quarterly.
Distributions from net realized capital gains are distributed to shareholders at
least annually.
3. INVESTMENT ADVISOR AND SUB-ADVISER
AGREEMENTS
The Funds have an Investment Management Agreement dated October 1, 2005 (the
"Agreement") with CCM Advisors, LLC (the "Adviser"), an affiliate of City
National Asset Management, Inc. ("CNAM, Inc."), with whom certain officers and
trustees of the Funds are affiliated, to furnish investment advisory services to
the Funds. Under the terms of the Agreement, the Funds compensate the Adviser
for its management services at the annual rate of 0.50% of each Fund's average
daily net assets for the Limited Maturity Fund and the Full Maturity Fund, and
an annual rate of 0.75% of each Fund's average daily net assets for the Balanced
Fund, Diversified Fund and the Socially Responsible Fund. Effective through
September 30, 2006, the Adviser had contractually agreed to pay all operating
expenses in excess of the annual rates presented below as applied to each Fund's
average daily net assets.
Expense Cap (as a % of average daily net assets)
Limited Full Socially
Maturity Maturity Balanced Diversified Responsible
Fund Fund Fund Fund Fund
- --------------------------------------------------------------------------------
Class I 0.75% 0.80% 1.00% 1.01% 1.04%
Class A 1.00% 1.05% N/A 1.26% 1.29%
- --------------------------------------------------------------------------------
AHA INVESTMENT FUNDS | PAGE 37
notes to financial statements
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
Effective November 1, 2006, the Adviser has contractually agreed to pay all
operating expenses in excess of the annual rates presented below as applied to
each Fund's average daily net assets.
Expense Cap (as a % of average daily net assets)
Limited Full Socially
Maturity Maturity Balanced Diversified Responsible
Fund Fund Fund Fund Fund
- --------------------------------------------------------------------------------
Class I 1.00% 1.00% 1.00% 1.25% 1.25%
Class A 1.25% 1.25% N/A 1.50% 1.50%
- --------------------------------------------------------------------------------
Any fee reductions or expense reimbursements may be repaid to the Adviser within
three years after occurrence, subject to certain restrictions and only if such
repayments do not cause the Funds' expense ratios, at the time of repayment, to
exceed the amounts shown in the preceding table.
During the six months ended March 31, 2007, the Board of Trustees approved the
reimbursement of previously waived fees by the Adviser in the amount of $244,
$13,553, $925, $23,472 and $1,547 for the Limited Maturity Fund, the Full
Maturity Fund, the Balanced Fund, the Diversified Fund and the Socially
Responsible Fund, respectively.
As of March 31, 2007, fees which were previously waived by the Adviser which may
be subject to possible future reimbursement to the Adviser were as follows:
Potential Amount of
Fund Recovery (000) Expiration
- ----------------------------------------------------------------
Limited Maturity Fund $ 15 2008
136 2009
3 2010
Full Maturity Fund 4 2007
10 2009
Balanced Fund 33 2008
18 2009
Diversified Fund 50 2009
Socially Responsible Fund 6 2008
18 2009
4 2010
- ----------------------------------------------------------------
Prior to November 1, 2001, the Adviser was compensated for its services directly
by the shareholders and not by the Funds pursuant to the Program Services
Agreement it had with each shareholder, under which the Adviser provided asset
allocation consulting and certain other services. The fees of the investment
managers were paid by the Adviser. The Program Service Fee was equal to 0.50% of
average daily net assets for the Full Maturity Fund and Limited Maturity Fund,
and 0.75% of average daily net assets for the Balanced Fund and Diversified
Fund. This service fee was reflected in the total return as disclosed in the
financial highlights tables.
THE PATTERSON CAPITAL CORPORATION and CNAM INC. act as the sub-advisers on
behalf of the AHA Limited Maturity Fund and are paid by the Adviser.
ROBERT W. BAIRD & CO., INCORPORATED AND BOYD WATTERSON ASSET MANAGEMENT, LLC act
as sub-advisers on behalf of the AHA Full Maturity Fund and are paid by the
Adviser. Prior to October 3, 2005, Western Asset Management Company also acted
as the sub-adviser on behalf of the Full Maturity Fund and was paid by the
Adviser.
ROBERT W. BAIRD & CO., INCORPORATED, CAMBIAR INVESTORS, LLC and FREEMAN
ASSOCIATES INVESTMENT MANAGEMENT LLC act as sub-advisers on behalf of the
Balanced Fund and are paid by the Adviser.
CAMBIAR INVESTORS, LLC AND FREEMAN ASSOCIATES INVESTMENT MANAGEMENT LLC act as
sub-advisers on behalf of the AHA Diversified Equity Fund and are paid by the
Adviser. Effective October 1, 2006, Cambiar was replaced with AMBS INVESTMENT
COUNSEL, LLC and SKBA CAPITAL MANAGEMENT, LLC as sub-advisers for portions of
the AHA Diversified Equity Fund and are paid by the Adviser.
SKBA CAPITAL MANAGEMENT, LLC acts as the sub-adviser on behalf of the AHA
Socially Responsible Fund and is paid by the Adviser.
4. ADMINISTRATION, TRANSFER AGENT AND
DISTRIBUTION AGREEMENTS
Pursuant to an administration agreement (the "Agreement"), SEI Investments
Global Funds Services (the "Administrator"), a wholly owned subsidiary of SEI
Investments Company, acts as the AHA Funds Administrator. Effective with the
reorganization into the CNI Charter Funds on October 3, 2005, under the terms of
the Agreement dated April 1, 1999, as amended January 1, 2005, the Administrator
is entitled to receive an annual fee of 0.065% of aggregate average daily net
assets of the Trust not exceeding $2.5 billion, 0.045% of aggregate average
daily net assets of the Trust exceeding $2.5 billion but not exceeding $5
billion, and 0.025% of aggregate average daily net assets of the Trust exceeding
$5 billion. Prior to October 3, 2005, under the terms of the Agreement dated
April 8, 2005, the Administrator was entitled to receive an annual fee equal to
the greater of $250,000 or 0.10% of aggregate average daily net assets of the
AHA Funds.
The AHA Funds have adopted a Rule 12b-1 Distribution Plan ("the Plan") with
respect to Class A Shares that allows each Fund to pay distribution and
servicing fees. SEI Investments Distribution Co. (the "Distributor"), as
compensation for its services under the Plan, receives a distribution fee,
computed daily and paid monthly, at the annual rate of 0.25% of the average
daily net assets of the Class A Shares of each Fund.
AHA INVESTMENT FUNDS | PAGE 38
SEI Investments Fund Management serves as Transfer Agent for the Trust whereby
they provide services at an annual rate of $15,000 per share class. The Transfer
Agent has voluntarily agreed to waive these fees.
Citigroup Fund Services, LLC serves as sub-transfer Agent for the AHA Funds
whereby they provide services at an annual rate of $14,000 per share class.
U.S. Bank, N.A. serves as Custodian for the Trust. The Custodian plays no role
in determining the investment policies of the AHA Funds or which securities are
to be purchased or sold by the AHA Funds.
Certain officers of the Trust are also officers of the Advisor and/or the
Administrator. Such officers are paid no fees by the Trust or the AHA Funds for
serving as officers of the Funds.
5. FEDERAL INCOME TAXES
It is each Funds' policy to continue to qualify as a regulated investment
company under Subchapter M of the Internal Revenue Code and the Funds intend to
distribute investment company net taxable income and net capital gains to
shareholders. Therefore, no Federal income tax provision is required.
The Funds may be subject to taxes imposed by countries in which they invest,
with respect to their investments in issuers existing or operating in such
countries. Such taxes are generally based on income earned. The Funds accrue
such taxes when the related income is earned.
The timing and characterization of certain income and capital gains
distributions are determined annually in accordancewith Federal tax regulations,
which may differ from accounting principles generally accepted in the United
States. As a result, net investment income (loss) and net realized gain (loss)
on investment transactions for a reporting period may differ significantly from
distributions during such period. These book/tax differences may be temporary or
permanent. To the extent these differences are permanent in nature, they are
charged or credited to paid-in-capital, undistributed net investment income
(loss), or accumulated net realized gain (loss), as appropriate, in the period
that the differences arise.
The tax character of dividends and distributions declared during the periods
ended September 30, 2006, September 30, 2005 and June 30, 2005 are shown below
(000's):
Ordinary Long-term
Income Capital Gain Total
Fund (000) (000) (000)
- ----------------------------------------------------------------------
Limited Maturity Fund
September 2006 $2,460 $ -- $2,460
September 2005 704 -- 704
June 2005 2,965* 168 3,133
Full Maturity Fund
September 2006 1,394 85 1,479
September 2005 277 -- 277
June 2005 1,141 239 1,380
Balanced Fund
September 2006 635 787 1,422
September 2005 75 -- 75
June 2005 301 -- 301
Diversified Fund
September 2006 1,057 4,157 5,214
September 2005 103 -- 103
June 2005 652 -- 652
Socially Responsible Fund
September 2006 370 -- 370
September 2005 45 -- 45
June 2005 109 -- 109
* Includes tax return of capital of less than $1 (000's).
AHA INVESTMENT FUNDS | PAGE 39
notes to financial statements
MARCH 31, 2007 (UNAUDITED)
- --------------------------------------------------------------------------------
As of September 30, 2006, the components of Distributable Earnings/(Accumulated Losses) on a tax basis were as follows (000's):
Undistributed Undistributed Capital Unrealized Other Total
Ordinary Long-term Loss Post-October Appreciation Temporary Distributable Earnings
Income Capital Gain Carryforwards Losses (Depreciation) Differences (Accumulated Losses)
Fund (000) (000) (000) (000) (000) (000) (000)
- ------------------------------------------------------------------------------------------------------------------------------------
Limited Maturity Fund $ 155 $ -- $(1,047) $(1,403) $ (162) $(148) $ (2,605)
Full Maturity Fund 108 -- (109) (283) 32 (106) (358)
Balanced Fund 228 921 -- -- 1,399 -- 2,548
Diversified Fund 1,771 5,872 -- -- 11,256 -- 18,899
Socially Responsible Fund 13 597 -- -- 2,256 -- 2,866
Post-October losses represent losses realized on investments and foreign
currency transactions from November 1, 2005 through September 30, 2006 that, in
accordance with Federal income tax regulations, the Funds have elected to defer
and treat as having arisen in the following fiscal year.
For tax purposes, the losses in the Funds can be carried forward for a maximum
of eight years to offset any future net realized capital gains. At September 30,
2006, the breakdown of capital loss carryforwards was as follows (000's):
Expiring
--------------------------------
2012 2013 2014 Total
Fund (000) (000) (000) (000)
- --------------------------------------------------------------------------------
Limited Maturity Fund $76 $838 $133 $1,047
Full Maturity Fund -- 64 45 109
- --------------------------------------------------------------------------------
The Federal tax cost, the aggregate gross unrealized appreciation on securities,
the aggregate gross unrealized depreciation on securities and the net unrealized
appreciation/(depreciation) for tax purposes at March 31, 2007 for each of the
Funds were as follows (000's):
Aggregate Aggregate Net
Gross Gross Unrealized
Federal Unrealized Unrealized Appreciation
Tax Cost Appreciation Depreciation (Depreciation)
Fund (000) (000) (000) (000)
- --------------------------------------------------------------------------------
Limited Maturity Fund $ 42,761 $ 99 $ (95) $ 4
Full Maturity Fund 39,777 353 (217) 136
Balanced Fund 16,096 813 (279) 534
Diversified Fund 103,250 10,416 (2,137) 8,279
Socially Responsible Fund 50,555 5,823 (554) 5,269
- --------------------------------------------------------------------------------
6. CAPITAL SHARE TRANSACTIONS (000'S):
The share transactions for the six months ended March 31, 2007 (unaudited) and the year ended September 30, 2006 are as follows:
Limited Maturity Fund (000) Full Maturity Fund (000) Balanced Fund (000)
----------------------------- ----------------------------- --------------------------
03/31/07 09/30/06 03/31/07 09/30/06 03/31/07 09/30/06
----------------------------- ----------------------------- --------------------------
Class I
Shares Sold 46 63 785 503 -- --
Shares Issued in
Reinvestment
of Dividends 20 121 22 50 4 6
Shares Redeemed (322) (6,520) -- (628) -- (61)
- ------------------------------------------------------- ----------------------------- --------------------------
Total Net Change (256) (6,336) 807 (75) 4 (55)
======================================================= ============================= ==========================
Class A
Shares Sold 2 16 4 1
Shares Issued in
Reinvestment
of Dividends 1 1 -- 1
Shares Redeemed (11) (61) -- (1)
- ------------------------------------------------------- -----------------------------
Total Net Change (8) (44) 4 1
======================================================= =============================
AHA INVESTMENT FUNDS | PAGE 40
6. CAPITAL SHARE TRANSACTIONS (CONTINUED) (000'S):
Socially
Diversified Fund Responsible Fund
----------------------------- -----------------------------
03/31/07 09/30/06 03/31/07 09/30/06
----------------------------- -----------------------------
Class I
Shares Sold 354 1,789 351 2,133
Shares Issued in
Reinvestment
of Dividends 346 192 82 35
Shares Redeemed (338) (1,447) (47) (163)
- ------------------------------------------------------- -----------------------------
Total Net Change 362 534 386 2,005
======================================================= =============================
Class A
Shares Sold 44 102 38 25
Shares Issued in
Reinvestment
of Dividends 50 27 1 --
Shares Redeemed (124) (59) (6) --
- ------------------------------------------------------- -----------------------------
Total Net Change (30) 70 33 25
======================================================= =============================
7. SECURITIES TRANSACTIONS
Purchases and sales and maturities of investment securities, other than
short-term investments, for the six months ended March 31, 2007 were as follows:
Purchases Sales & Maturities
- --------------------------------------------------------------------------------
U.S. Gov`t Other U.S. Gov`t Other
Fund (000) (000) (000) (000)
- --------------------------------------------------------------------------------
Limited Maturity Fund $17,019 $ 6,485 $9,528 $13,770
Full Maturity Fund 8,395 9,328 6,108 3,634
Balanced Fund 1,212 12,778 630 15,224
Diversified Fund -- 77,522 -- 80,320
Socially Responsible Fund -- 7,863 -- 4,349
- --------------------------------------------------------------------------------
8. SECURITIES LENDING
The Custodian serves as the AHA Funds' securities lending agent. Certain Funds
lend their securities to approved brokers to earn additional income and receive
cash and/or securities as collateral to secure the loans. Income the Funds
earned on securities purchased with cash collateral is reflected on the
statements of operations. Collateral was maintained at not less than 102% of the
value of loaned securities. If cash collateral is received, a related liability
is shown on the statement of net assets. Although the risk of lending is
mitigated by the collateral, a Fund could experience a delay in recovering its
securities and a possible loss of income or value if the borrower fails to
return them. There was no loss of income or value reported for the securities on
loan for the six months ended March 31, 2007.
9. INVESTMENT RISKS
In the normal course of business, the AHA Funds enter into contracts that
provide general indemnifications by the Fund to the counterparty to the
contract. The Funds' maximum exposure under these arrangements is dependent on
future claims that may be made against the Funds and, therefore, cannot be
established; however, based on experience, the risk of loss from such claim is
considered remote.
10. NEW ACCOUNTING PRONOUNCEMENTS
On July 13, 2006, the Financial Accounting Standards Board (FASB) released FASB
Interpretation No. 48 "Accounting for Uncertainty in Income Taxes" (FIN 48). FIN
48 provides guidance for how uncertain tax positions should be recognized,
measured, presented and disclosed in the Funds' financial statements. FIN 48
requires the evaluation of tax positions taken or expected to be taken in the
course of preparing the Funds' tax returns to determine whether the tax
positions are "more-likely-than-not" of being sustained by the applicable tax
authority. Tax positions not deemed to meet the more-likely-than-not threshold
would be recorded as a tax benefit or expense in the current year. Adoption of
FIN 48 is required for fiscal years beginning after December 15, 2006 and is to
be applied to all open tax years as of the effective date. As of March 31, 2007,
the Funds have not completed their evaluation of the impact, if any, that will
result from the adoption of FIN 48.
AHA INVESTMENT FUNDS | PAGE 41
notes to financial statements
March 31, 2007 (Unaudited)
- --------------------------------------------------------------------------------
In September 2006, FASB issued Statement on Financial Accounting Standards
(SFAS) No. 157, "Fair Value Measurements." This standard establishes a single
authoritative definition of fair value, sets out a framework for measuring fair
value and requires additional disclosures about fair value measurements. SFAS
No. 157 applies to fair value measurements already required or permitted by
existing standards. SFAS No. 157 is effective for financial statements issued
for fiscal years beginning after November 15, 2007 and interim periods within
those fiscal years. The changes to current generally accepted accounting
principles from the application of this Statement relate to the definition of
fair value, the methods used to measure fair value, and the expanded disclosures
about fair value measurements. As of March 31, 2007, the Funds do not believe
the adoption of SFAS No. 157 will impact the amounts reported in the financial
statements; however, additional disclosures may be required about the inputs
used to develop the measurements and the effect of certain of the measurements
reported on the statement of changes in net assets for a fiscal period.
AHA INVESTMENT FUNDS | PAGE 42
disclosure of fund expenses (UNAUDITED)
As a Class I shareholder of the AHA Limited Maturity Fund, the AHA Full Maturity
Fund, the AHA Balanced Fund, the AHA Diversified Fund and the AHA Socially
Responsible Fund (each a "Fund" and collectively, the "Funds"), you will incur
ongoing costs, including management fees and other Fund expenses. As a Class A
shareholder of the AHA Limited Maturity Fund, the AHA Full Maturity Fund, the
AHA Diversified Fund and the AHA Socially Responsible Fund, you will incur
ongoing costs and distribution fees. The examples below are intended to help you
understand your ongoing costs (in dollars) of investing in the Funds and to
compare these costs with the ongoing costs of investing in other mutual funds.
The examples are based on an investment of $1,000 for the six months ended March
31, 2007.
ACTUAL EXPENSES. The first line of the tables below provides information about
actual account values and actual expenses. The Funds charge no sales load or
transaction fees, but do assess shareholders of IRA accounts a $25.00 annual
maintenance fee by Forum Shareholder Services, LLC (a division of Citigroup Fund
Services, LLC) the Funds' sub-transfer agent. To the extent the Funds invest in
shares of other investment companies as part of their investment strategies, you
will indirectly bear your proportionate share of any fees and expenses charged
by the underlying funds in which the Funds invest, in addition to the expenses
of the Funds. Actual expenses of the underlying funds are expected to vary among
the various underlying funds. These expenses are not included in the example
below. The example below includes, but is not limited to, management fees,
shareholder servicing fees, fund accounting, custody and transfer agent fees.
However, the example below does not include portfolio trading commissions,
related expenses and other extraordinary expenses as determined under generally
accepted accounting principles. You may use the information in this line,
together with the amount you invested, to estimate the expenses that you paid
over the period. Simply divide your account value by $1,000 (for example, an
$8,600 account value divided by $1,000 = 8.6), then multiply the result by the
number in the first line under the heading entitled "Expenses Paid During
Period" to estimate the expenses you paid on your account during this period.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES. The second line of the table below
provides information about hypothetical account values and hypothetical expenses
based on the Funds' actual expense ratios and an assumed rate of return of 5%
per year before expenses, which does not the represent the Funds' actual
returns. The hypothetical account values and expenses may not be used to
estimate the actual ending account balance or expenses you paid for the period.
You may use this information to compare the ongoing costs of investing in the
Funds and other funds. To do so, compare this 5% hypothetical example with the
5% hypothetical examples that appear in the shareholder reports of the other
funds. Please note that the expenses shown in the table are meant to highlight
your ongoing costs only and do not reflect any transactional costs. Therefore,
the second line of the table is useful in comparing ongoing costs only, and will
not help you determine the relative total costs of owning different funds. In
addition, if these transactional costs were included, your costs would have been
higher. Ending account values and expenses paid during the period are based on a
hypothetical 2.50% rate of return. The rate of return is considered before
expenses are deducted from the Fund.
Beginning Ending Expenses
Account Account Annualized Paid
Value Value Expense During
10/1/06 3/31/07 Ratios Period*
- --------------------------------------------------------------------------------
AHA LIMITED MATURITY FIXED INCOME FUND
- --------------------------------------------------------------------------------
Actual Fund Return
Class I $1,000.00 $1,023.60 0.79% $3.99
Class A 1,000.00 1,022.30 1.04% 5.24
Hypothetical 5% Return
Class I $1,000.00 $1,020.99 0.79% $3.98
Class A 1,000.00 1,019.75 1.04% 5.24
- --------------------------------------------------------------------------------
AHA FULL MATURITY FIXED INCOME FUND
- --------------------------------------------------------------------------------
Actual Fund Return
Class I $1,000.00 $1,024.50 0.80% $4.04
Class A 1,000.00 1,023.20 1.05% 5.30
Hypothetical 5% Return
Institutional Class $1,000.00 $1,020.94 0.80% $4.03
Class A 1,000.00 1,019.70 1.05% 5.29
- --------------------------------------------------------------------------------
AHA BALANCED FUND
- --------------------------------------------------------------------------------
Actual Fund Return
Class I $1,000.00 $1,047.90 1.00% $5.11
Hypothetical 5% Return
Class I $1,000.00 $1,019.95 1.00% $5.04
Beginning Ending Expenses
Account Account Annualized Paid
Value Value Expense During
10/1/06 3/31/07 Ratios Period*
- --------------------------------------------------------------------------------
AHA DIVERSIFIED EQUITY FUND
- --------------------------------------------------------------------------------
Actual Fund Return
Class I $1,000.00 $1,067.90 1.02% $5.26
Class A 1,000.00 1,066.40 1.27% 6.54
Hypothetical 5% Return
Institutional Class $1,000.00 $1,019.85 1.02% $5.14
Class A 1,000.00 1,018.60 1.27% 6.39
- --------------------------------------------------------------------------------
AHA SOCIALLY RESPONSIBLE EQUITY FUND
- --------------------------------------------------------------------------------
Actual Fund Return
Class I $1,000.00 $1,088.60 0.94% $4.89
Class A 1,000.00 1,087.50 1.19% 6.19
Hypothetical 5% Return
Institutional Class $1,000.00 $1,020.24 0.94% $4.73
Class A 1,000.00 1,019.00 1.19% 5.99
- --------------------------------------------------------------------------------
*Expenses are equal to the Fund's annualized expense ratio of 1.00%, multiplied
by the average account value over the period, multiplied by 182/365 (to reflect
the six month period).
AHA INVESTMENT FUNDS | PAGE 43
approval of sub-advisory agreement (UNAUDITED)
- --------------------------------------------------------------------------------
The Board of Trustees of CNI Charter Funds (the "Trust") is comprised of four
Trustees, all of whom are independent of the Trust's investment advisers and
sub-advisers. During the six months ended March 31, 2007, the Board of Trustees
approved a new sub-advisory agreement (the "Agreement") between CCM Advisors,
LLC ("CCMA") and Boyd Watterson Asset Management, LLC ("Boyd Watterson") with
respect to the AHA Full Maturity Fixed Income Fund (the "Full Maturity Fund").
Boyd Watterson has served as a sub-adviser to the Full Maturity Fund since
December 2005. However, under the Investment Company Act of 1940 the acquisition
of its parent company, Mercantile Bankshares Corporation, by PNC Financial
Services Group automatically terminated its existing sub-advisory agreement with
the Fund.
The following information summarizes the Board's considerations associated with
its approval of the Agreement. In connection with their deliberations, the Board
considered such information and factors as they believed, in light of the legal
advice furnished to them and their own business judgment, to be relevant. This
included not only information provided to the Board in connection with its
review of the Agreement, but information received by the Board in connection
with its regular quarterly meetings. As the overall performance, advisory fees
and expenses of the Full Maturity Fund are considered by the Board of Trustees
in connection with its annual review of the Fund's advisory arrangements with
CCMA, and CCMA pays the Fund's sub-advisory fees, the Board's review of the
Agreement focused primarily on the nature, quality and extent of the investment
sub-advisory services being performed by Boyd Watterson. In considering these
matters, the Board discussed the approval of the Agreement with management and
in private sessions with counsel at which no representatives of CCMA or Boyd
Watterson were present. In deciding to approve the Agreement, the Board did not
identify a single factor as controlling and this summary does not describe all
of the matters considered. However, the Board concluded that each of the various
factors referred to below favored such approval.
In reviewing the services provided by Boyd Watterson, the Board considered a
variety of matters, including the investment performance of the portion of the
Fund managed by Boyd Watterson; the background, education and experience of its
key portfolio management and operational personnel; its overall financial
strength and stability, as well as that of its parent company; its regulatory
compliance systems and procedures; its resources and related efforts to retain,
attract and motivate capable personnel to serve the Full Maturity Fund; and the
overall general quality and depth of its organization and that of its parent.
The Board also reviewed Boyd Watterson's investment philosophy and processes as
well as brokerage, trading and soft dollar practices. The Board noted Boyd
Watterson's representation that it would continue to operate autonomously from
its parent, and concluded that the acquisition of its parent by PNC Financial
Group would not adversely impact its operations.
The Board reviewed information regarding the advisory fees charged by Boyd
Watterson and noted that Boyd Watterson's fees for services to the Full Maturity
Fund were in line with the fees it charges two other mutual funds for which it
serves as sub-adviser, and were lower than its standard fee schedule for
institutional clients. The Board also considered that although Boyd Watterson's
sub-advisory fee schedule had no breakpoints, the Fund's asset levels were not
so substantial that they would lead to significant economies of scale.
The Board also reviewed information prepared by Boyd Watterson relating to Boyd
Watterson's costs and profits with respect to the Full Maturity Fund, as well as
the methodologies used to determine and allocate such costs to its management of
the Fund. The Board noted that neither Boyd Watterson nor its affiliates would
receive benefits other than investment sub-advisory fees as a result of its
relationship with the Fund, except the intangible benefits of the favorable
publicity arising in connection with the Fund's performance.
Based on its review, including its consideration of each of the factors referred
to above, the Board concluded that the Agreement would represent fair and
reasonable compensation in light of the nature and quality of the services
proposed to be provided by Boyd Watterson to the Full Maturity Fund and its
shareholders.
AHA INVESTMENT FUNDS | PAGE 44
<page>
------------------------------------
AHA INVESTMENT FUNDS
190 South LaSalle Street, Suite 2800
Chicago, Illinois 60603
1-800-445-1341
------------------------------------
INVESTMENT ADVISOR
CCM Advisors, LLC
190 South LaSalle Street, Suite 2800
Chicago, Illinois 60603
ADMINISTRATOR
SEI Investments Global Funds Services
One Freedom Valley Drive
Oaks, Pennsylvania 19456
SUB-TRANSFER AGENT AND
DIVIDEND DISBURSEMENT AGENT
Citigroup Fund Services, LLC
Two Portland Square
Portland, Maine 04101
CUSTODIAN
U.S. Bank, N.A.
2 Liberty Place, 20th Floor
Philadelphia, Pennsylvania 19102
LEGAL COUNSEL
Paul Hastings, Janofsky & Walker LLP
515 South Flower Street
Los Angeles, California 90071
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
KPMG LLP
Suite 2000
355 South Grand Avenue
Los Angeles, California 90071
DISTRIBUTOR
SEI Investments Distribution Co.
One Freedom Valley Drive
Oaks, Pennsylvania 19456
[AHA Logo Omitted]
American Hospital
Association
a tobacco-free investment [CNI Logo Omitted]
CNI CHARTER FUNDS
CNI-SA-003-0200
ITEM 2. CODE OF ETHICS.
Not applicable for semi-annual report.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable for semi-annual report.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable for semi-annual report.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable to open-end management investment companies.
ITEM 6. SCHEDULE OF INVESTMENTS.
Not applicable.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable to open-end management investment companies.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable. Effective for closed-end management investment companies for
fiscal years ending on or after December 31, 2005
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT COMPANY AND
AFFILIATED PURCHASERS.
Not applicable to open-end management investment companies.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
CNI Charter Funds (the "Fund") has adopted the following procedures by which
shareholders may recommend nominees to the Fund's Board of Trustees. The Fund
has a Nominating Committee comprised solely of persons who are not considered
"interested persons" of the Fund within the meaning of the Investment Company
Act of 1940. The Committee periodically reviews such issues as the Board's
composition, responsibilities, committees, compensation and other relevant
issues, and recommends any appropriate changes to the full Board of Trustees.
While the Committee normally is able to identify from its own resources an ample
number of qualified candidates, it will consider shareholder suggestions of
persons to be considered as nominees to fill future vacancies on the Board, so
long as the shareholder or shareholder group submitting a proposed nominee: (a)
beneficially owns more than 5% of the Fund's voting shares and has held such
shares continuously for two years, and (b) is not an adverse holder. No eligible
shareholder or shareholder group may submit more than one independent Board
member nominee each year. Such suggestions must be sent in writing to the Fund
's Secretary, and must be accompanied by the shareholder's contact information,
the nominee's contact information and number of Fund shares owned by the
nominee, all information regarding the nominee that would be required to be
disclosed in solicitations of proxies for elections of directors required under
the Securities Exchange Act of 1934, and a notarized
letter from the nominee stating his or her intention to serve as a nominee and
be named in the Fund's proxy statement, if so designated by the Committee and
the Board of Trustees.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The certifying officers, whose certifications are included herewith, have
evaluated the registrant's disclosure controls and procedures within 90 days of
the filing date of this report. In their opinion, based on their evaluation, the
registrant's disclosure controls and procedures are adequately designed, and are
operating effectively to ensure, that information required to be disclosed by
the registrant in the reports it files or submits under the Securities Exchange
Act of 1934 is recorded, processed, summarized and reported within the time
periods specified in the Securities and Exchange Commission's rules and forms.
(b) There were no significant changes in the registrant's internal control over
financial reporting that occurred during the registrant's last fiscal half-year
that has materially affected, or is reasonably likely to materially affect, the
registrants internal control over financial reporting.
ITEMS 12. EXHIBITS.
(a)(1) Not applicable for semi-annual report.
(a)(2) A separate certification for the principal executive officer and the
principal financial officer of the registrant as required by Rule 30a-2(a) under
the Investment Company Act of 1940, as amended (17 CFR 270.30a-2(a)), are filed
herewith.
(b) Officer certifications as required by Rule 30a-2(b) under the Investment
Company Act of 1940, as amended (17 CFR 270.30a-2(b)) also accompany this filing
as an Exhibit.
- --------------------------------------------------------------------------------
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) CNI Charter Funds
By (Signature and Title)* /s/ Richard D. Byrd
-------------------------------------
Richard D. Byrd, President & CEO
Date May 24, 2007
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/ Richard D. Byrd
-------------------------------------
Richard D. Byrd, President & CEO
Date May 24, 2007
By (Signature and Title)* /s/ Eric Kleinschmidt
-------------------------------------
Eric Kleinschmidt, Controller and COO
Date May 24, 2007
* Print the name and title of each signing officer under his or her signature.