UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act File Number 811-2111
RIVERSOURCE LARGE CAP SERIES, INC.
(Exact name of registrant as specified in charter)
50606 Ameriprise Financial Center, Minneapolis, Minnesota 55474
(Address of principal executive offices) (Zip code)
Scott R. Plummer - 5228 Ameriprise Financial Center, Minneapolis, MN 55474
(Name and address of agent for service)
Registrant's telephone number, including area code: (612) 671-1947
Date of fiscal year end: July 31
Date of reporting period: July 31, 2010
ITEM 1. REPORTS TO STOCKHOLDERS.
Annual Report
and Prospectus
(COLUMBIA MANAGEMENT LOGO)
COLUMBIA
LARGE CORE QUANTITATIVE FUND
(FORMERLY KNOWN AS RIVERSOURCE
DISCIPLINED EQUITY FUND)
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ANNUAL REPORT FOR THE PERIOD ENDED
JULY 31, 2010
(Prospectus also enclosed)
COLUMBIA LARGE CORE QUANTITATIVE FUND SEEKS TO PROVIDE
SHAREHOLDERS WITH LONG-TERM CAPITAL GROWTH.
This annual report includes a prospectus that describes in detail the Fund's
objective, investment strategy, risks, sales charges, fees and other matters of
interest. Please read the prospectus carefully before you invest or send money.
NOT FDIC INSURED - NO BANK GUARANTEE - MAY LOSE VALUE
TABLE OF CONTENTS --------------------------------------------------------------
<Table>
Your Fund at a Glance.............. 3
Manager Commentary................. 6
The Fund's Long-term Performance... 12
Fund Expenses Example.............. 14
Portfolio of Investments........... 17
Statement of Assets and
Liabilities...................... 31
Statement of Operations............ 33
Statements of Changes in Net
Assets........................... 35
Financial Highlights............... 37
Notes to Financial Statements...... 46
Report of Independent Registered
Public Accounting Firm........... 66
Federal Income Tax Information..... 68
Board Members and Officers......... 69
Approval of Investment Management
Services Agreement............... 75
Proxy Voting....................... 78
</Table>
Note: Effective September 27, 2010, the Fund has been renamed. While this
report covers the fiscal period ended July 31, 2010, which is prior to
the name change, the Fund's new name has been reflected throughout.
SEE THE FUND'S PROSPECTUS FOR RISKS ASSOCIATED WITH INVESTING IN THE FUND.
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2 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
YOUR FUND AT A GLANCE ----------------------------------------------------------
FUND SUMMARY
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> Columbia Large Core Quantitative Fund (the Fund) Class A shares gained 14.03%
(excluding sales charge) for the 12 months ended July 31, 2010.
> The Fund outperformed the unmanaged Standard & Poor's 500 Index (S&P 500
Index), which rose 13.84% for the same time frame.
> The Fund also outperformed the Lipper Large-Cap Core Funds Index, representing
the Fund's peer group, which advanced 11.44%, for the same period.
ANNUALIZED TOTAL RETURNS (for period ended July 31, 2010)
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<Table>
<Caption>
SINCE
INCEPTION
1 YEAR 3 YEARS 5 YEARS 4/24/03
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Columbia Large Core Quantitative
Fund Class A (excluding sales
charge) +14.03% -8.80% -1.35% +3.89%
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S&P 500 Index (unmanaged) +13.84% -6.78% -0.17% +4.71%
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Lipper Large-Cap Core Funds
Index (unmanaged) +11.44% -6.66% -0.17% +3.98%
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</Table>
(See "The Fund's Long-term Performance" for Index descriptions)
The performance information shown represents past performance and is not a
guarantee of future results. The investment return and principal value of your
investment will fluctuate so that your shares, when redeemed, may be worth more
or less than their original cost. Current performance may be lower or higher
than the performance information shown. You may obtain performance information
current to the most recent month-end by contacting your financial intermediary,
visiting columbiamanagement.com or calling 800.345.6611.
The 5.75% sales charge applicable to Class A shares of the Fund is not reflected
in the table above. If reflected, returns would be lower than those shown. The
performance of other classes may vary from that shown because of differences in
fees and expenses. The Fund's returns reflect the effect of fee waivers/expense
reimbursements, if any. Without such waivers/reimbursements, the Fund's returns
would be lower. See the Average Annual Total Returns table for performance of
other share classes of the Fund.
The indices do not reflect the effects of sales charges, expenses (excluding
Lipper) and taxes. It is not possible to invest directly in an index.
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COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 3
YOUR FUND AT A GLANCE (continued) ----------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS
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<Table>
<Caption>
AT JULY 31, 2010
SINCE
Without sales charge 1 YEAR 3 YEARS 5 YEARS INCEPTION
Class A (inception 4/24/03) +14.03% -8.80% -1.35% +3.89%
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Class B (inception 4/24/03) +13.03% -9.49% -2.08% +3.09%
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Class C (inception 4/24/03) +12.97% -9.52% -2.09% +3.09%
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Class I (inception 7/15/04) +14.38% -8.45% -0.97% +1.62%
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Class R2(*) (inception
12/11/06) +13.43% -9.05% N/A -6.68%
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Class R3(**) (inception
12/11/06) +13.92% -8.77% N/A -6.42%
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Class R4 (inception 4/24/03) +14.14% -8.67% -1.18% +4.06%
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Class R5 (inception 12/11/06) +14.41% -8.48% N/A -6.10%
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Class W (inception 12/1/06) +13.93% -8.88% N/A -6.09%
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With sales charge
Class A (inception 4/24/03) +7.48% -10.58% -2.51% +3.05%
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Class B (inception 4/24/03) +8.03% -10.31% -2.39% +3.09%
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Class C (inception 4/24/03) +11.97% -9.52% -2.09% +3.09%
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</Table>
Class A share performance reflects the maximum initial sales charge of 5.75%.
Class B share performance reflects a contingent deferred sales charge (CDSC)
applied as follows: first year 5%; second year 4%; third and fourth years 3%;
fifth year 2%; sixth year 1%; no sales charge thereafter. Class C shares may be
subject to a 1% CDSC if shares are sold within one year after purchase. Sales
charges do not apply to Class I, Class R2, Class R3, Class R4, Class R5 and
Class W shares. Class I, Class R2, Class R3, Class R4 and Class R5 are available
to qualifying institutional investors only. Class W shares are offered through
qualifying discretionary accounts.
* Effective Sept. 7, 2010, Class R2 shares were renamed Class R shares.
** Effective July 23, 2010, the Fund no longer offers Class R3 shares.
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4 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
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MORNINGSTAR STYLE BOX(TM)
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<Table>
<Caption>
Equity Style
Value Blend Growth
X Large
Medium Size
Small
</Table>
The Morningstar Style Box(TM) is based on the fund's portfolio holdings as of
period end. For equity funds, the vertical axis shows the market capitalization
of the stocks owned, and the horizontal axis shows investment style (value,
blend, or growth). Information shown is based on the most recent data provided
by Morningstar.
(C)2010 Morningstar, Inc. All rights reserved. The information contained herein
is proprietary to Morningstar and/or its content providers, may not be copied or
distributed and is not warranted to be accurate, complete, or timely. Neither
Morningstar nor its content providers are responsible for any damages or losses
arising from any use of this information. Past performance is no guarantee of
future results.
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COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 5
MANAGER COMMENTARY -------------------------------------------------------------
Effective May 1, 2010, Brian Condon joined Gina Mourtzinou as co-portfolio
manager of the Fund. Effective July 3, 2010, Mr. Condon became sole portfolio
manager of the Fund.
Dear Shareholder,
Columbia Large Core Quantitative Fund (the Fund) Class A shares gained 14.03%
(excluding sales charge) for the 12 months ended July 31, 2010. The Fund
outperformed the Standard & Poor's 500 Index (S&P 500 Index), which rose 13.84%,
as well as the Lipper Large-Cap Core Funds Index, representing the Fund's peer
group, which advanced 11.44%, for the same period.
SIGNIFICANT PERFORMANCE FACTORS
Against a strengthening economic backdrop supported by generally positive data,
the equity market rally that had begun in mid-March 2009 continued with little
interruption until May 2010. As investor risk aversion had abated significantly,
lower quality stocks led the way during these months. The rally then stalled in
May and June of 2010 as worries
SECTOR BREAKDOWN(1) (at July 31, 2010)
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<Table>
<Caption>
Consumer Discretionary 9.8%
- ------------------------------------------------
Consumer Staples 11.5%
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Energy 11.2%
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Financials 16.1%
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Health Care 11.6%
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Industrials 10.3%
- ------------------------------------------------
Information Technology 18.9%
- ------------------------------------------------
Materials 3.3%
- ------------------------------------------------
Telecommunication Services 3.3%
- ------------------------------------------------
Utilities 3.3%
- ------------------------------------------------
Other(2) 0.7%
- ------------------------------------------------
</Table>
(1) Sectors can be comprised of several industries. Please refer to the section
entitled "Portfolio of Investments" for a complete listing. No single
industry exceeded 25% of portfolio assets.
Percentages indicated are based upon total investments (excluding
Investments of Cash Collateral Received for Securities on Loan). The Fund's
composition is subject to change.
(2) Cash & Cash Equivalents.
The sectors identified above are based on the Global Industry Classification
Standard (GICS), which was developed by, and is the exclusive property of,
Morgan Stanley Capital International Inc. and Standard & Poor's, a division of
The McGraw-Hill Companies, Inc.
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6 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
heightened about the sovereign debt crisis in Europe and about the trajectory of
the nascent global economic recovery. Investors questioned whether the recovery
could be sustained without the tremendous fiscal and monetary stimulus injected
into the economy since the 2008 credit crisis, as several government and Federal
Reserve programs expired in March and April 2010. Further, unemployment and
housing data indicated persistent weakness. Investors also were uncertain about
how much of the first quarter 2010 rebound in corporate earnings was
attributable merely to rebuilding of inventories. The potential of a "double-
dip" recession or even deflation became of heightened concern. Equity market
volatility rose. That said, by the end of the annual period, a strong start to
the second quarter 2010 earnings reporting season buoyed the equity market as
did an overall improvement in risk sentiment. The release of the results of the
European bank stress tests on July 23 also had a positive impact on equity
markets broadly.
The Fund's performance was primarily driven by the three quantitative-based
investment themes we employed in selecting stocks for the Fund's
portfolio -- momentum, valuation and quality. During the 12-month period, the
valuation and momentum themes outperformed the S&P 500
TOP TEN HOLDINGS(1) (at July 31, 2010)
- ---------------------------------------------------------------------
<Table>
<Caption>
Apple, Inc. 4.3%
- ------------------------------------------------
Microsoft Corp. 3.8%
- ------------------------------------------------
Chevron Corp. 3.6%
- ------------------------------------------------
IBM Corp. 3.3%
- ------------------------------------------------
Wal-Mart Stores, Inc. 2.7%
- ------------------------------------------------
ConocoPhillips 2.6%
- ------------------------------------------------
Citigroup, Inc. 2.4%
- ------------------------------------------------
General Electric Co. 2.3%
- ------------------------------------------------
AT&T, Inc. 2.1%
- ------------------------------------------------
Merck & Co., Inc. 2.0%
- ------------------------------------------------
</Table>
(1) Percentages indicated are based upon total investments (excluding
Investments of Cash Collateral Received for Securities on Loan and Cash &
Cash Equivalents).
For further detail about these holdings, please refer to the section entitled
"Portfolio of Investments."
Fund holdings are as of the date given, are subject to change at any time, and
are not recommendations to buy or sell any security.
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COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 7
MANAGER COMMENTARY (continued) -------------------------------------------------
Index, more than offsetting the trailing performance of the quality theme. The
valuation theme, which favors cheaper price-to-earnings ratio (P/E) stocks,
benefited from exposure to consumer discretionary and financials stocks. Indeed,
having increased the Fund's emphasis on the valuation theme in the last months
of the prior fiscal year, the Fund was well positioned during this annual period
for the rebound in value-oriented stocks that occurred in 2009 and into 2010.
The momentum theme, designed in part to capture investor sentiment over the near
to mid term, was aided mainly by information technology stocks. The quality
theme, which was intended to serve in part as a defensive measure during equity
market corrections when investor risk aversion increases, trailed due to
exposure to more defensive sectors such as health care. It is important to
remember that the themes we used take turns in leading performance over time,
demonstrating the advantages of employing style diversification. Such variance
in performance supports our research indicating that the style diversification
provided by the three very different quantitative-based themes is a significant
investment advantage over the long term, even though the Fund may experience
underperformance in the short term. At the same time, we are continuously
looking for ways to improve our investment process and to enhance the efficacy
of the quantitative-based themes we use in the Fund.
Following a specific, disciplined process, we do not make sector or industry
bets based on economic or equity market outlooks. That said, the Fund's
quantitative-based themes led to a modest bias toward higher quality stocks due
to market volatility. This bias hurt performance, particularly in the beginning
of the annual period when lower quality stocks led. However, this same bias
helped in the last months of the annual period when market volatility
heightened. The Fund's themes also positioned the Fund toward mega-cap, or the
largest cap, stocks. This positioning had minimal impact on Fund performance
during the annual period.
The Fund's quantitative-based themes led to various sector weightings that,
together, detracted from results. Having only a modest position in industrials,
which was the top performing sector of the S&P 500 Index during the period, and
a more sizable weighting in health care, which lagged, hurt most. Partially
offsetting these negatives was the positive
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8 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
effect of a significant allocation to the relatively stronger performing
telecommunication services sector and having only a modest exposure to the
weaker utilities sector.
Because we use a bottom-up approach, it is not surprising that stock selection
was the primary driver of the Fund's results. Specifically, the Fund benefited
from strong stock selection in information technology, energy and financials.
This more than offset the combined effect of stock selection in consumer staples
and health care, which detracted.
Among individual holdings, information technology leaders APPLE and MICROSOFT,
each selected by the momentum theme, contributed significantly to the Fund's
returns. Other top contributors during the annual period included energy
companies CHEVRON and CONOCOPHILLIPS, each a valuation and quality pick, and
financials companies PNC FINANCIAL and AMERICAN EXPRESS, each selected by the
valuation theme.
Stocks that detracted most from the Fund's returns included financials company
GOLDMAN SACHS, selected by the valuation theme, energy giant EXXON MOBIL, a
quality theme pick, health benefits provider WELLPOINT, selected by the quality
theme, and integrated utilities company EXELON, a quality and valuation theme
pick.
At the end of July, the Fund's largest individual stock holdings were Apple,
Microsoft, Chevron, information technology company IBM, selected by the momentum
and quality themes, and WAL-MART STORES.
During the 12-month period, the valuation and momentum themes outperformed the
S&P 500 Index, more than offsetting the trailing performance of the quality
theme.
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 9
MANAGER COMMENTARY (continued) -------------------------------------------------
CHANGES TO THE FUND'S PORTFOLIO
As a result of quantitative-based theme-driven stock selection during the annual
period, the Fund's sector allocations changed somewhat. For example, the Fund's
allocation to information technology increased, although this remained a more
modest weighting than in the S&P 500 Index. The Fund's already modest exposure
to consumer staples compared to the S&P 500 Index became an even greater
underweighting.
Our risk models limit the size of individual holdings, as well as sector and
industry allocations, relative to the S&P 500 Index. For instance, the
portfolio's weightings by sector and industry are limited to no more than 6%
overweighted or underweighted relative to the S&P 500 Index. We also apply
additional risk measures that impose constraints on market capitalization,
price, quality, turnover, transaction costs and other variables.
Perhaps the biggest change made was that a new portfolio management team was put
in place toward the end of the annual period. The Fund's principal investment
strategies remained based on quantitative analysis, using similar investment
themes. However, while we continue to use computer-based models to analyze
stocks within sectors, the new team's models are somewhat different from those
previously used. We seek to maintain sector weighting neutrality overall
relative to the benchmark index, and the models drive stock selection by
focusing on factors within three themes -- quality, valuation and catalyst.
Quality-theme factors include profitability as well as strength and
sustainability measures, such as return on assets, return on equity,
receivables, reserve management and cash flow accruals. Valuation-theme factors
measure profitability-at-a-reasonable-price and growth-at-a-reasonable-price and
include cash flow, operating income, sales, earnings, book value and risk-
adjusted return. Catalyst-theme factors include long-term and short-term
momentum measures and estimate revisions.
OUR FUTURE STRATEGY
We hold a cautious view regarding prospects for the financial markets over the
remainder of 2010. After a solid run over the 12 months ended July 31, 2010, we
believe stocks appeared to be closer to fair value than they had been one year
prior. At the same time, however, we expect volatility to remain somewhat
heightened. We believe the U.S. economy
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10 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
will continue to recover, albeit at a relatively slow pace, and that inflation
should remain under control.
Given this view, we intend to use our quantitative-based themes, as described
above, in our stock selection process, seeking to position the Fund's portfolio
to take advantage of a shift in underlying market dynamics. At the same time,
consistent with our disciplined approach, we remain focused on the long term and
maintain the Fund's diversification across sectors and securities. We intend to
continue seeking optimal returns for the Fund through the style diversification
offered by the various themes within our well-tested quantitative investment
models. We are convinced of the merit of our multifaceted, disciplined approach
to managing risk in the portfolio and believe this combination of style
diversification and rigorous risk management will allow us to maintain the high
quality of the Fund's portfolio in whatever market conditions lie ahead.
Brian Condon, CFA(R)
Portfolio Manager
Any specific securities mentioned are for illustrative purposes only and are not
a complete list of securities that have increased or decreased in value. The
views expressed in this statement reflect those of the portfolio manager(s) only
through the end of the period of the report as stated on the cover and do not
necessarily represent the views of Columbia Management Investment Advisers, LLC*
(the Investment Manager) or any subadviser to the Fund or any other person in
the Investment Manager or subadviser organizations. Any such views are subject
to change at any time based upon market or other conditions and the Investment
Manager disclaims any responsibility to update such views. These views may not
be relied on as investment advice and, because investment decisions for the Fund
are based on numerous factors, may not be relied on as an indication of trading
intent on behalf of the Fund.
* Effective May 1, 2010, RiverSource Investments, LLC became known as Columbia
Management Investment Advisers, LLC.
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COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 11
THE FUND'S LONG-TERM PERFORMANCE -----------------------------------------------
The chart on the facing page illustrates the total value of an assumed $10,000
investment in Columbia Large Core Quantitative Fund Class A shares (from 4/24/03
to 7/31/10) as compared to the performance of the Standard & Poor's 500 Index
(S&P 500 Index) and the Lipper Large-Cap Core Funds Index. In comparing the
Fund's Class A shares to these indices, you should take into account the fact
that the Fund's performance reflects the maximum initial sales charge of 5.75%,
while such charges are not reflected in the performance of the indices. Returns
for the Fund include the reinvestment of any distributions paid during each
period.
The performance information shown represents past performance and is not a
guarantee of future results. The table below and the chart on the facing page do
not reflect the deduction of taxes that a shareholder would pay on fund
distributions or the redemption of fund shares. The investment return and
principal value of your investment will fluctuate so that your shares, when
redeemed, may be worth more or less than their original cost. Current
performance may be lower or higher than the performance information shown. You
may obtain performance information current to the most recent month-end by
contacting your financial intermediary or visiting columbiamanagement.com. Also
see "Past Performance" in the Fund's current prospectus.
COMPARATIVE RESULTS
- --------------------------------------------------------------------------------
<Table>
<Caption>
Results at July 31, 2010
SINCE
INCEPTION
1 YEAR 3 YEARS 5 YEARS 4/24/03
COLUMBIA LARGE CORE QUANTITATIVE FUND
(INCLUDES SALES CHARGE)
Class A Cumulative value of $10,000 $10,748 $7,150 $8,806 $12,442
- -------------------------------------------------------------------------------------------
Average annual total return +7.48% -10.58% -2.51% +3.05%
- -------------------------------------------------------------------------------------------
S&P 500 INDEX(1)
Cumulative value of $10,000 $11,384 $8,101 $9,915 $13,969
- -------------------------------------------------------------------------------------------
Average annual total return +13.84% -6.78% -0.17% +4.71%
- -------------------------------------------------------------------------------------------
LIPPER LARGE-CAP CORE FUNDS INDEX(2)
Cumulative value of $10,000 $11,144 $8,132 $9,915 $13,278
- -------------------------------------------------------------------------------------------
Average annual total return +11.44% -6.66% -0.17% +3.98%
- -------------------------------------------------------------------------------------------
</Table>
Results for other share classes can be found on page 4.
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12 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
(VALUE OF A HYPOTHETICAL $10,000 INVESTMENT IN COLUMBIA LARGE CORE QUANTITATIVE
FUND LINE GRAPH)
<Table>
<Caption>
COLUMBIA LARGE
CORE QUANTITATIVE
FUND CLASS
A (INCLUDES LIPPER LARGE-CAP
SALES CHARGE) S&P 500 CORE FUNDS
($12,442) INDEX(1) ($13,969) INDEX(2) ($13,278)
----------------- ------------------ ------------------
4/24/03 $ 9,425 $10,000 $10,000
4/03 9,482 10,063 10,054
7/03 10,255 10,917 10,813
10/03 10,934 11,634 11,412
1/04 11,890 12,579 12,231
4/04 11,581 12,364 11,992
7/04 11,485 12,354 11,894
10/04 11,851 12,730 12,201
1/05 12,521 13,361 12,765
4/05 12,342 13,146 12,480
7/05 13,316 14,089 13,387
10/05 13,216 13,838 13,257
1/06 14,255 14,747 14,192
4/06 14,506 15,172 14,533
7/06 14,149 14,846 14,056
10/06 15,367 16,099 15,199
1/07 16,152 16,886 15,907
4/07 16,674 17,482 16,446
7/07 16,402 17,239 16,328
10/07 17,470 18,441 17,482
1/08 15,604 16,495 15,713
4/08 15,846 16,665 15,850
7/08 14,203 15,328 14,677
10/08 11,063 11,786 11,206
1/09 9,083 10,125 9,690
4/09 9,565 10,781 10,457
7/09 10,910 12,270 11,914
10/09 11,509 12,942 12,491
1/10 11,943 13,480 12,993
4/10 13,387 14,970 14,299
7/10 12,442 13,969 13,278
</Table>
(1) The Standard & Poor's 500 Index (S&P 500 Index), an unmanaged index of
common stocks, is frequently used as a general measure of market
performance. The index reflects reinvestment of all distributions and
changes in market prices.
(2) The Lipper Large-Cap Core Funds Index includes the 30 largest large-cap core
funds tracked by Lipper Inc. The index's returns include net reinvested
dividends. The Fund's performance is currently measured against this index
for purposes of determining the performance incentive adjustment.
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 13
FUND EXPENSES EXAMPLE ----------------------------------------------------------
(UNAUDITED)
As a shareholder of the Fund, you incur two types of costs: (i) transaction
costs, including sales charges (loads) on purchase payments; and (ii) ongoing
costs, which may include management fees; distribution and service (Rule 12b-1)
fees; and other Fund fees and expenses. This example is intended to help you
understand your ongoing costs (in dollars) of investing in the Fund and to
compare these costs with the ongoing costs of investing in other mutual funds.
In addition to the ongoing expenses which the Fund bears directly, the Fund's
shareholders indirectly bear the ongoing expenses of any funds in which the Fund
invests (also referred to as "acquired funds"), including affiliated and non-
affiliated pooled investment vehicles (including mutual funds and exchange
traded funds). The Fund's indirect expense from investing in the acquired funds
is based on the Fund's pro rata portion of the ongoing expenses charged by
acquired funds using the expense ratio of each of the acquired funds as of the
acquired fund's most recent shareholder report.
The example is based on an investment of $1,000 invested at the beginning of the
period and held for the six months ended July 31, 2010.
ACTUAL EXPENSES
The first line of the table provides information about actual account values and
actual expenses for each class. 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 titled "Expenses paid during the
period" to estimate the expenses you paid on your account during this period.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line of the table provides information about hypothetical account
values and hypothetical expenses based on the actual expense ratio for each
class and an assumed rate of return of 5% per year before expenses, which is not
the actual return for the class. 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 Fund 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, such as sales
charges (loads). 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.
- --------------------------------------------------------------------------------
14 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
<Table>
<Caption>
BEGINNING ENDING EXPENSES
ACCOUNT VALUE ACCOUNT VALUE PAID DURING ANNUALIZED
FEB. 1, 2010 JULY 31, 2010 THE PERIOD(a) EXPENSE RATIO
- ------------------------------------------------------------------------------------------
Class A
- ------------------------------------------------------------------------------------------
Actual(b) $1,000 $1,041.80 $5.29(c) 1.04%
- ------------------------------------------------------------------------------------------
Hypothetical
(5% return before expenses) $1,000 $1,019.75 $5.24(c) 1.04%
- ------------------------------------------------------------------------------------------
Class B
- ------------------------------------------------------------------------------------------
Actual(b) $1,000 $1,037.40 $9.24(c) 1.82%
- ------------------------------------------------------------------------------------------
Hypothetical
(5% return before expenses) $1,000 $1,015.86 $9.15(c) 1.82%
- ------------------------------------------------------------------------------------------
Class C
- ------------------------------------------------------------------------------------------
Actual(b) $1,000 $1,037.90 $9.15(c) 1.80%
- ------------------------------------------------------------------------------------------
Hypothetical
(5% return before expenses) $1,000 $1,015.96 $9.05(c) 1.80%
- ------------------------------------------------------------------------------------------
Class I
- ------------------------------------------------------------------------------------------
Actual(b) $1,000 $1,043.80 $3.01(c) .59%
- ------------------------------------------------------------------------------------------
Hypothetical
(5% return before expenses) $1,000 $1,021.99 $2.97(c) .59%
- ------------------------------------------------------------------------------------------
Class R2
- ------------------------------------------------------------------------------------------
Actual(b) $1,000 $1,039.60 $7.07(c) 1.39%
- ------------------------------------------------------------------------------------------
Hypothetical
(5% return before expenses) $1,000 $1,018.00 $6.99(c) 1.39%
- ------------------------------------------------------------------------------------------
Class R3
- ------------------------------------------------------------------------------------------
Actual(b) $1,000 $1,041.80 $5.80(c) 1.14%
- ------------------------------------------------------------------------------------------
Hypothetical
(5% return before expenses) $1,000 $1,019.25 $5.74(c) 1.14%
- ------------------------------------------------------------------------------------------
Class R4
- ------------------------------------------------------------------------------------------
Actual(b) $1,000 $1,041.60 $4.53(c) .89%
- ------------------------------------------------------------------------------------------
Hypothetical
(5% return before expenses) $1,000 $1,020.49 $4.48(c) .89%
- ------------------------------------------------------------------------------------------
Class R5
- ------------------------------------------------------------------------------------------
Actual(b) $1,000 $1,044.00 $3.26(c) .64%
- ------------------------------------------------------------------------------------------
Hypothetical
(5% return before expenses) $1,000 $1,021.74 $3.23(c) .64%
- ------------------------------------------------------------------------------------------
Class W
- ------------------------------------------------------------------------------------------
Actual(b) $1,000 $1,041.80 $5.29(c) 1.04%
- ------------------------------------------------------------------------------------------
Hypothetical
(5% return before expenses) $1,000 $1,019.75 $5.24(c) 1.04%
- ------------------------------------------------------------------------------------------
</Table>
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 15
FUND EXPENSES EXAMPLE (continued) ----------------------------------------------
(a) Expenses are equal to the annualized expense ratio for each class as
indicated above, multiplied by the average account value over the period,
multiplied by 182/365 (to reflect the one-half year period).
(b) Based on the actual return for the six months ended July 31, 2010: +4.18%
for Class A, +3.74% for Class B, +3.79% for Class C, +4.38% for Class I,
+3.96% for Class R2, +4.18% for Class R3, +4.16% for Class R4, +4.40% for
Class R5 and +4.18% for Class W.
(c) Columbia Management Investment Advisers, LLC (formerly known as RiverSource
Investments, LLC) (the Investment Manager) and its affiliates have
contractually agreed to waive certain fees and to absorb certain expenses
until Sept. 30, 2011, unless sooner terminated at the sole discretion of the
Fund's Board, such that net expenses (excluding fees and expenses of
acquired funds), before giving effect to any performance incentive
adjustment, will not exceed 1.07% for Class A, 1.82% for Class B, 1.82% for
Class C, 0.64% for Class I, 1.32% for Class R2, 1.17% for Class R3, 0.94%
for Class R4, 0.69% for Class R5 and 1.07% for Class W. Any amounts waived
will not be reimbursed by the Fund. This change is effective Oct. 1, 2010.
Had this change been in place for the entire six month period ended July 31,
2010, the actual expenses paid would have been $5.55 for Class A, $9.35 for
Class B, $9.35 for Class C, $3.31 for Class I, $6.81 for Class R2, $6.06 for
Class R3, $4.89 for Class R4, $3.62 for Class R5 and $5.55 for Class W; the
hypothetical expenses paid would have been $5.49 for Class A, $9.25 for
Class B, $9.25 for Class C, $3.28 for Class I, $6.74 for Class R2, $5.99 for
Class R3, $4.84 for Class R4, $3.58 for Class R5 and $5.49 for Class W.
- --------------------------------------------------------------------------------
16 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
PORTFOLIO OF INVESTMENTS -------------------------------------------------------
JULY 31, 2010
(Percentages represent value of investments compared to net assets)
INVESTMENTS IN SECURITIES
<Table>
<Caption>
COMMON STOCKS (98.6%)
ISSUER SHARES VALUE(a)
AEROSPACE & DEFENSE (3.7%)
General Dynamics Corp. 287,791 $17,627,199
ITT Corp. 54,267 2,557,061
L-3 Communications Holdings, Inc. 28,851 2,107,277
Lockheed Martin Corp. 450,090(e) 33,824,264
Northrop Grumman Corp. 79,437(e) 4,658,186
Raytheon Co. 799,584 36,996,751
Rockwell Collins, Inc. 78,432 4,483,173
United Technologies Corp. 501,091 35,627,570
---------------
Total 137,881,481
- -------------------------------------------------------------------------------------
AIR FREIGHT & LOGISTICS (0.1%)
CH Robinson Worldwide, Inc. 61,293(e) 3,996,304
- -------------------------------------------------------------------------------------
AUTOMOBILES (0.4%)
Ford Motor Co. 501,862(b,e) 6,408,778
Harley-Davidson, Inc. 312,011(e) 8,496,059
---------------
Total 14,904,837
- -------------------------------------------------------------------------------------
BEVERAGES (2.2%)
Brown-Forman Corp., Class B 166,341(e) 10,514,415
The Coca-Cola Co. 1,275,454 70,290,270
---------------
Total 80,804,685
- -------------------------------------------------------------------------------------
BIOTECHNOLOGY (0.9%)
Amgen, Inc. 545,673(b) 29,755,549
Cephalon, Inc. 86,619(b,e) 4,915,628
---------------
Total 34,671,177
- -------------------------------------------------------------------------------------
CAPITAL MARKETS (0.8%)
Franklin Resources, Inc. 101,411(e) 10,199,918
T Rowe Price Group, Inc. 28,175(e) 1,358,880
The Goldman Sachs Group, Inc. 122,049 18,407,431
---------------
Total 29,966,229
- -------------------------------------------------------------------------------------
CHEMICALS (1.4%)
CF Industries Holdings, Inc. 55,426 4,500,037
Eastman Chemical Co. 365,780(e) 22,912,459
EI du Pont de Nemours & Co. 29,239 1,189,150
International Flavors & Fragrances, Inc. 118,635 5,383,656
PPG Industries, Inc. 148,760 10,334,357
Sigma-Aldrich Corp. 56,009(e) 3,142,105
The Sherwin-Williams Co. 61,958(e) 4,284,396
---------------
Total 51,746,160
- -------------------------------------------------------------------------------------
COMMERCIAL BANKS (3.6%)
Comerica, Inc. 65,095(e) 2,497,044
Fifth Third Bancorp 443,135 5,632,246
First Horizon National Corp. 516,395(b,e) 5,923,051
Huntington Bancshares, Inc. 363,386 2,202,119
KeyCorp 155,310(e) 1,313,923
M&T Bank Corp. 49,520(e) 4,325,077
Marshall & Ilsley Corp. 194,803 1,369,465
PNC Financial Services Group, Inc. 940,736 55,870,310
SunTrust Banks, Inc. 350,473(e) 9,094,774
US Bancorp 119,355 2,852,585
Wells Fargo & Co. 1,634,708 45,330,453
---------------
Total 136,411,047
- -------------------------------------------------------------------------------------
COMMERCIAL SERVICES & SUPPLIES (0.5%)
Avery Dennison Corp. 30,266 1,085,036
Pitney Bowes, Inc. 192,737(e) 4,704,710
RR Donnelley & Sons Co. 727,673(e) 12,275,844
Waste Management, Inc. 2,000(e) 67,900
---------------
Total 18,133,490
- -------------------------------------------------------------------------------------
</Table>
See accompanying Notes to Portfolio of Investments.
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 17
PORTFOLIO OF INVESTMENTS (continued) -------------------------------------------
<Table>
<Caption>
COMMON STOCKS (CONTINUED)
ISSUER SHARES VALUE(a)
COMMUNICATIONS EQUIPMENT (0.6%)
Cisco Systems, Inc. 846,316(b) $19,524,510
Harris Corp. 47,990 2,136,995
---------------
Total 21,661,505
- -------------------------------------------------------------------------------------
COMPUTERS & PERIPHERALS (6.5%)
Apple, Inc. 611,034(b) 157,188,496
Dell, Inc. 999,141(b) 13,228,627
Hewlett-Packard Co. 603,306 27,776,208
Lexmark International, Inc., Class A 290,029(b,e) 10,658,566
NetApp, Inc. 528,967(b,e) 22,375,304
QLogic Corp. 15,253(b,e) 242,828
Teradata Corp. 441,300(b) 14,033,340
Western Digital Corp. 84,639(b,e) 2,233,623
---------------
Total 247,736,992
- -------------------------------------------------------------------------------------
CONSTRUCTION & ENGINEERING (0.2%)
Fluor Corp. 131,438(e) 6,347,141
- -------------------------------------------------------------------------------------
CONSUMER FINANCE (1.6%)
American Express Co. 950,177 42,415,902
Discover Financial Services 728,468 11,123,706
SLM Corp. 458,905(b,e) 5,506,860
---------------
Total 59,046,468
- -------------------------------------------------------------------------------------
DISTRIBUTORS (0.1%)
Genuine Parts Co. 49,347 2,113,532
- -------------------------------------------------------------------------------------
DIVERSIFIED CONSUMER SERVICES (0.2%)
Apollo Group, Inc., Class A 95,703(b) 4,414,779
H&R Block, Inc. 168,338 2,639,540
---------------
Total 7,054,319
- -------------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL SERVICES (2.8%)
Bank of America Corp. 1,131,725 15,889,419
Citigroup, Inc. 21,816,614(b) 89,448,117
---------------
Total 105,337,536
- -------------------------------------------------------------------------------------
DIVERSIFIED TELECOMMUNICATION SERVICES (3.3%)
AT&T, Inc. 2,956,600 76,694,204
Verizon Communications, Inc. 1,584,174(e) 46,036,096
---------------
Total 122,730,300
- -------------------------------------------------------------------------------------
ELECTRIC UTILITIES (1.4%)
Edison International 188,613 6,252,521
Entergy Corp. 192,400 14,912,924
Exelon Corp. 465,965 19,491,316
FirstEnergy Corp. 218,737(e) 8,246,385
Pepco Holdings, Inc. 165,723(e) 2,802,376
---------------
Total 51,705,522
- -------------------------------------------------------------------------------------
ELECTRICAL EQUIPMENT (0.6%)
Emerson Electric Co. 375,370(e) 18,595,829
Rockwell Automation, Inc. 52,710(e) 2,854,247
---------------
Total 21,450,076
- -------------------------------------------------------------------------------------
ELECTRONIC EQUIPMENT, INSTRUMENTS & COMPONENTS (0.4%)
Corning, Inc. 292,938 5,308,037
Jabil Circuit, Inc. 195,377 2,834,920
Tyco Electronics Ltd. 215,570(c) 5,820,390
---------------
Total 13,963,347
- -------------------------------------------------------------------------------------
ENERGY EQUIPMENT & SERVICES (0.6%)
Diamond Offshore Drilling, Inc. 59,023(e) 3,511,278
FMC Technologies, Inc. 96,878(b) 6,130,441
Halliburton Co. 95,165 2,843,530
Nabors Industries Ltd. 181,396(b,c) 3,339,500
National Oilwell Varco, Inc. 150,182 5,881,127
Rowan Companies, Inc. 84,835(b,e) 2,142,932
---------------
Total 23,848,808
- -------------------------------------------------------------------------------------
FOOD & STAPLES RETAILING (3.0%)
Safeway, Inc. 143,586(e) 2,949,256
Walgreen Co. 342,190 9,769,525
Wal-Mart Stores, Inc. 1,936,692 99,139,263
---------------
Total 111,858,044
- -------------------------------------------------------------------------------------
FOOD PRODUCTS (2.5%)
Campbell Soup Co. 325,000(e) 11,667,500
ConAgra Foods, Inc. 164,577(e) 3,864,268
General Mills, Inc. 158,261 5,412,526
Hormel Foods Corp. 177,604(e) 7,622,764
Kellogg Co. 94,200(e) 4,714,710
Sara Lee Corp. 1,297,554(e) 19,190,824
The Hershey Co. 888,484(e) 41,758,748
---------------
Total 94,231,340
- -------------------------------------------------------------------------------------
</Table>
See accompanying Notes to Portfolio of Investments.
- --------------------------------------------------------------------------------
18 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
<Table>
<Caption>
COMMON STOCKS (CONTINUED)
ISSUER SHARES VALUE(a)
GAS UTILITIES (0.2%)
Oneok, Inc. 125,944(e) $5,860,174
- -------------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SUPPLIES (1.3%)
Becton Dickinson and Co. 86,231 5,932,693
CareFusion Corp. 224,544(b) 4,731,142
CR Bard, Inc. 28,179(e) 2,212,897
Intuitive Surgical, Inc. 50,134(b,e) 16,462,502
Medtronic, Inc. 466,186 17,234,896
St Jude Medical, Inc. 41,861(b) 1,539,229
Varian Medical Systems, Inc. 27,347(b,e) 1,509,554
---------------
Total 49,622,913
- -------------------------------------------------------------------------------------
HEALTH CARE PROVIDERS & SERVICES (3.5%)
Aetna, Inc. 156,945 4,370,918
AmerisourceBergen Corp. 210,461(e) 6,307,516
Cardinal Health, Inc. 133,752 4,316,177
CIGNA Corp. 379,453 11,671,974
Coventry Health Care, Inc. 136,744(b) 2,711,634
Humana, Inc. 69,243(b) 3,255,806
Laboratory Corp. of America Holdings 17,800(b) 1,299,044
McKesson Corp. 63,704 4,001,885
Tenet Healthcare Corp. 567,964(b,e) 2,612,634
UnitedHealth Group, Inc. 2,270,340(e) 69,131,853
WellPoint, Inc. 387,787(b) 19,668,557
---------------
Total 129,347,998
- -------------------------------------------------------------------------------------
HOTELS, RESTAURANTS & LEISURE (0.2%)
Starwood Hotels & Resorts Worldwide, Inc. 93,370(e) 4,523,776
Wyndham Worldwide Corp. 133,379(e) 3,405,166
---------------
Total 7,928,942
- -------------------------------------------------------------------------------------
HOUSEHOLD DURABLES (0.1%)
Newell Rubbermaid, Inc. 181,026(e) 2,805,903
Whirlpool Corp. 27,747(e) 2,311,325
---------------
Total 5,117,228
- -------------------------------------------------------------------------------------
HOUSEHOLD PRODUCTS (0.7%)
Clorox Co. 75,994(e) 4,930,491
Colgate-Palmolive Co. 159,741 12,616,344
Kimberly-Clark Corp. 152,900 9,803,948
---------------
Total 27,350,783
- -------------------------------------------------------------------------------------
INDEPENDENT POWER PRODUCERS & ENERGY TRADERS (0.4%)
Constellation Energy Group, Inc. 193,735 6,122,026
NRG Energy, Inc. 192,389(b) 4,363,383
The AES Corp. 311,929(b) 3,215,988
---------------
Total 13,701,397
- -------------------------------------------------------------------------------------
INDUSTRIAL CONGLOMERATES (3.1%)
3M Co. 354,512 30,324,956
General Electric Co. 5,324,607 85,832,665
---------------
Total 116,157,621
- -------------------------------------------------------------------------------------
INSURANCE (5.6%)
Aflac, Inc. 473,999 23,316,011
AON Corp. 568,235 21,405,412
Assurant, Inc. 166,592 6,212,216
Chubb Corp. 571,260 30,065,414
Hartford Financial Services Group, Inc. 425,943 9,971,326
Lincoln National Corp. 397,673(e) 10,355,405
Principal Financial Group, Inc. 461,247(e) 11,812,536
The Allstate Corp. 1,241,185 35,051,064
The Travelers Companies, Inc. 981,605 49,521,971
Torchmark Corp. 151,338(e) 8,031,508
Unum Group 120,100(e) 2,740,682
---------------
Total 208,483,545
- -------------------------------------------------------------------------------------
INTERNET & CATALOG RETAIL (0.4%)
priceline.com, Inc. 69,608(b,e) 15,620,035
- -------------------------------------------------------------------------------------
IT SERVICES (4.3%)
Automatic Data Processing, Inc. 122,233(e) 5,044,556
Cognizant Technology Solutions Corp., Class A 463,149(b) 25,269,409
Computer Sciences Corp. 36,444 1,652,007
IBM Corp. 938,920(d) 120,557,328
Mastercard, Inc., Class A 24,090(e) 5,059,864
SAIC, Inc. 133,045(b,e) 2,212,538
Total System Services, Inc. 17,806(e) 265,487
---------------
Total 160,061,189
- -------------------------------------------------------------------------------------
LEISURE EQUIPMENT & PRODUCTS (--%)
Mattel, Inc. 97,031 2,053,176
- -------------------------------------------------------------------------------------
</Table>
See accompanying Notes to Portfolio of Investments.
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 19
PORTFOLIO OF INVESTMENTS (continued) -------------------------------------------
<Table>
<Caption>
COMMON STOCKS (CONTINUED)
ISSUER SHARES VALUE(a)
MACHINERY (1.0%)
Caterpillar, Inc. 231,873(e) $16,173,142
Eaton Corp. 61,874(e) 4,854,634
Flowserve Corp. 13,127 1,301,673
Illinois Tool Works, Inc. 187,816 8,169,996
Ingersoll-Rand PLC 144,336(c) 5,406,827
---------------
Total 35,906,272
- -------------------------------------------------------------------------------------
MEDIA (3.2%)
CBS Corp., Class B 1,048,916(e) 15,502,978
Gannett Co., Inc. 534,121(e) 7,039,715
News Corp., Class A 1,221,901 15,945,808
The New York Times Co., Class A 195,273(b) 1,706,686
The Walt Disney Co. 1,423,951(e) 47,972,910
Time Warner Cable, Inc. 130,802 7,477,950
Time Warner, Inc. 435,186 13,690,952
Viacom, Inc., Class B 315,058 10,409,516
---------------
Total 119,746,515
- -------------------------------------------------------------------------------------
METALS & MINING (1.8%)
Alcoa, Inc. 377,187(e) 4,213,179
Freeport-McMoRan Copper & Gold, Inc. 433,365 31,002,932
Newmont Mining Corp. 588,555 32,900,224
---------------
Total 68,116,335
- -------------------------------------------------------------------------------------
MULTILINE RETAIL (0.9%)
Family Dollar Stores, Inc. 490,049(e) 20,263,526
Macy's, Inc. 320,682 5,980,719
Nordstrom, Inc. 258,260(e) 8,780,840
Sears Holdings Corp. 7,112(b) 504,952
---------------
Total 35,530,037
- -------------------------------------------------------------------------------------
MULTI-UTILITIES (1.4%)
Ameren Corp. 82,274 2,087,291
Dominion Resources, Inc. 149,792(e) 6,289,766
DTE Energy Co. 120,393(e) 5,557,341
Integrys Energy Group, Inc. 55,859(e) 2,644,924
PG&E Corp. 177,331(e) 7,873,496
Public Service Enterprise Group, Inc. 863,469 28,408,130
---------------
Total 52,860,948
- -------------------------------------------------------------------------------------
OFFICE ELECTRONICS (0.3%)
Xerox Corp. 1,007,602 9,814,043
- -------------------------------------------------------------------------------------
OIL, GAS & CONSUMABLE FUELS (10.4%)
Apache Corp. 539,396 51,555,470
Chevron Corp. 1,718,921 130,998,970
ConocoPhillips 1,750,864 96,682,710
Exxon Mobil Corp. 942,587 56,253,592
Hess Corp. 107,973 5,786,273
Marathon Oil Corp. 1,029,805(e) 34,446,977
Massey Energy Co. 144,062 4,405,416
Murphy Oil Corp. 71,994 3,941,672
Pioneer Natural Resources Co. 42,804(e) 2,479,208
Sunoco, Inc. 44,569(e) 1,589,776
Valero Energy Corp. 208,880 3,548,871
---------------
Total 391,688,935
- -------------------------------------------------------------------------------------
PAPER & FOREST PRODUCTS (--%)
International Paper Co. 16,822 407,092
MeadWestvaco Corp. 31,320 750,428
---------------
Total 1,157,520
- -------------------------------------------------------------------------------------
PERSONAL PRODUCTS (0.6%)
The Estee Lauder Companies, Inc., Class A 336,622 20,954,720
- -------------------------------------------------------------------------------------
PHARMACEUTICALS (5.8%)
Abbott Laboratories 1,020,912 50,106,361
Bristol-Myers Squibb Co. 125,424 3,125,566
Eli Lilly & Co. 376,773(e) 13,413,119
Forest Laboratories, Inc. 424,458(b) 11,778,710
Johnson & Johnson 1,018,887 59,187,146
King Pharmaceuticals, Inc. 356,719(b,e) 3,124,858
Merck & Co., Inc. 2,132,929 73,500,733
Mylan, Inc. 152,992(b,e) 2,662,061
---------------
Total 216,898,554
- -------------------------------------------------------------------------------------
PROFESSIONAL SERVICES (0.2%)
Dun & Bradstreet Corp. 119,500(e) 8,169,020
- -------------------------------------------------------------------------------------
REAL ESTATE INVESTMENT TRUSTS (REITS) (1.5%)
Equity Residential 269,098(e) 12,338,143
Simon Property Group, Inc. 276,830(e) 24,698,773
Ventas, Inc. 149,597(e) 7,587,560
Vornado Realty Trust 150,504(e) 12,458,721
---------------
Total 57,083,197
- -------------------------------------------------------------------------------------
</Table>
See accompanying Notes to Portfolio of Investments.
- --------------------------------------------------------------------------------
20 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
<Table>
<Caption>
COMMON STOCKS (CONTINUED)
ISSUER SHARES VALUE(a)
ROAD & RAIL (0.9%)
CSX Corp. 149,508(e) $7,882,062
Norfolk Southern Corp. 270,648 15,229,363
Ryder System, Inc. 210,082 9,174,281
---------------
Total 32,285,706
- -------------------------------------------------------------------------------------
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT (2.6%)
Advanced Micro Devices, Inc. 1,651,100(b,e) 12,366,739
Intel Corp. 424,400 8,742,640
Micron Technology, Inc. 1,270,189(b,e) 9,246,976
Texas Instruments, Inc. 2,696,115(e) 66,567,079
---------------
Total 96,923,434
- -------------------------------------------------------------------------------------
SOFTWARE (4.1%)
Intuit, Inc. 118,700(b) 4,718,325
Microsoft Corp. 5,467,718(e) 141,121,802
Oracle Corp. 314,499 7,434,756
---------------
Total 153,274,883
- -------------------------------------------------------------------------------------
SPECIALTY RETAIL (3.5%)
AutoNation, Inc. 73,423(b) 1,793,724
Bed Bath & Beyond, Inc. 63,195(b) 2,393,827
Best Buy Co., Inc. 244,864(e) 8,486,986
GameStop Corp., Class A 765,223(b,e) 15,342,721
Home Depot, Inc. 620,699 17,696,128
Lowe's Companies, Inc. 44,630 925,626
Limited Brands, Inc. 2,125,019 54,485,487
Ross Stores, Inc. 258,076(e) 13,590,282
The Gap, Inc. 589,161(e) 10,669,706
Tiffany & Co. 66,409(e) 2,793,827
TJX Companies, Inc. 76,140(e) 3,161,333
---------------
Total 131,339,647
- -------------------------------------------------------------------------------------
TEXTILES, APPAREL & LUXURY GOODS (0.6%)
Coach, Inc. 112,739 4,167,961
NIKE, Inc., Class B 209,579(e) 15,433,397
Polo Ralph Lauren Corp. 21,958(e) 1,734,902
VF Corp. 14,845 1,177,654
---------------
Total 22,513,914
- -------------------------------------------------------------------------------------
TOBACCO (2.5%)
Altria Group, Inc. 1,434,984 31,799,245
Lorillard, Inc. 89,000(e) 6,785,360
Philip Morris International, Inc. 1,075,119 54,874,074
---------------
Total 93,458,679
- -------------------------------------------------------------------------------------
TRADING COMPANIES & DISTRIBUTORS (0.1%)
Fastenal Co. 52,695(e) 2,586,271
- -------------------------------------------------------------------------------------
TOTAL COMMON STOCKS
(Cost: $3,563,187,440) $3,689,213,971
- -------------------------------------------------------------------------------------
<Caption>
MONEY MARKET FUND (0.7%)
SHARES VALUE(a)
Columbia Short-Term Cash Fund, 0.279% 27,183,889(g) $27,183,889
- -------------------------------------------------------------------------------------
TOTAL MONEY MARKET FUND
(Cost: $27,183,889) $27,183,889
- -------------------------------------------------------------------------------------
</Table>
<Table>
<Caption>
INVESTMENTS OF CASH COLLATERAL RECEIVED
FOR SECURITIES ON LOAN (17.9%)
AMOUNT
EFFECTIVE PAYABLE AT
ISSUER YIELD MATURITY VALUE(a)
ASSET-BACKED COMMERCIAL PAPER (4.1%)
Amsterdam Funding Corp.
08-16-10 0.450% $4,996,500 $4,996,500
Antalis US Funding Corp.
08-04-10 0.320 9,999,378 9,999,378
08-17-10 0.380 4,998,470 4,998,470
Argento Variable Funding Company LLC
08-12-10 0.370 4,998,458 4,998,458
Cancara Asset Securitisation LLC
08-12-10 0.330 14,996,013 14,996,013
09-27-10 0.521 14,982,233 14,982,233
Ebbets Funding LLC
08-09-10 0.600 9,994,500 9,994,500
Grampian Funding LLC
08-06-10 0.370 19,993,628 19,993,628
Regency Markets No. 1 LLC
08-09-10 0.360 9,996,700 9,996,700
</Table>
See accompanying Notes to Portfolio of Investments.
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 21
PORTFOLIO OF INVESTMENTS (continued) -------------------------------------------
<Table>
<Caption>
INVESTMENTS OF CASH COLLATERAL RECEIVED
FOR SECURITIES ON LOAN (CONTINUED)
AMOUNT
EFFECTIVE PAYABLE AT
ISSUER YIELD MATURITY VALUE(a)
ASSET-BACKED COMMERCIAL PAPER (CONT.)
Royal Park Investments Funding Corp.
09-22-10 0.601% $9,985,667 $9,985,667
10-06-10 0.551 1,997,250 1,997,250
Thames Asset Global Securities
09-20-10 0.551 4,992,819 4,992,819
10-13-10 0.511 9,986,825 9,986,825
Versailles Commercial Paper LLC
08-23-10 0.681 9,988,100 9,988,100
---------------
Total 131,906,541
- -------------------------------------------------------------------------------------
CERTIFICATES OF DEPOSIT (9.3%)
Bank of Tokyo Securities
10-14-10 0.550 19,971,928 19,971,928
Banque et Caisse d'Epargne de l'Etat
08-16-10 0.400 4,998,223 4,998,223
Barclays Bank PLC
08-31-10 0.421 16,000,000 16,000,000
BNP Paribas
10-15-10 0.411 20,000,000 20,000,000
BRED Banque Populaire
08-13-10 0.620 9,989,677 9,989,677
09-08-10 0.600 4,994,839 4,994,839
Commerzbank AG
08-09-10 0.450 10,000,000 10,000,000
Credit Agricole
10-12-10 0.413 37,000,000 37,000,000
Credit Industrial et Commercial
08-02-10 0.460 20,000,000 20,000,000
10-20-10 0.540 5,000,000 5,000,000
Deutsche Bank AG
12-06-10 0.527 20,000,000 20,000,000
Dexia Credit Local
08-06-10 0.650 5,000,043 5,000,043
DZ Bank AG
08-09-10 0.470 20,000,000 20,000,000
08-12-10 0.450 10,000,000 10,000,000
Hong Kong Shanghai Bank Corp., Ltd.
08-05-10 0.300 25,000,000 25,000,000
KBC Bank NV
08-06-10 0.450 15,000,000 15,000,000
08-09-10 0.530 9,995,438 9,995,438
Landesbank Hessen Thuringen
08-10-10 0.440 9,995,968 9,995,968
Lloyds Bank PLC
10-14-10 0.520 5,000,000 5,000,000
N.V. Ban Nederlandse Gemeenten
09-13-10 0.380 10,000,000 10,000,000
Natixis
09-29-10 0.490 9,991,568 9,991,568
Norinchukin Bank
09-21-10 0.560 15,000,198 15,000,198
10-14-10 0.565 20,000,000 20,000,000
Pohjola Bank PLC
08-20-10 0.370 5,000,000 5,000,000
Rabobank Group
10-27-10 0.377 5,000,000 5,000,000
Royal Bank of Scotland
08-09-10 0.320 5,001,072 5,001,072
Societe Generale
09-01-10 0.655 18,000,000 18,000,000
Sumitomo Mitsui Banking Corp.
08-20-10 0.510 5,000,000 5,000,000
Union Bank of Switzerland
10-18-10 0.455 10,000,000 10,000,000
---------------
Total 370,938,954
- -------------------------------------------------------------------------------------
COMMERCIAL PAPER (0.8%)
State Development Bank of NorthRhine-Westphalia
10-08-10 0.511 9,987,108 9,987,108
10-15-10 0.491 9,987,342 9,987,342
Toyota Motor Credit Corp.
08-19-10 0.531 9,986,308 9,986,308
---------------
Total 29,960,758
- -------------------------------------------------------------------------------------
<Caption>
EFFECTIVE PRINCIPAL
ISSUER YIELD AMOUNT VALUE(a)
REPURCHASE AGREEMENTS (3.7%)(f)
Barclays Capital, Inc.
dated 03-22-10, matures 08-30-10,
repurchase price
$20,007,922 0.460% $20,000,000 $20,000,000
</Table>
See accompanying Notes to Portfolio of Investments.
- --------------------------------------------------------------------------------
22 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
<Table>
<Caption>
INVESTMENTS OF CASH COLLATERAL RECEIVED
FOR SECURITIES ON LOAN (CONTINUED)
EFFECTIVE PRINCIPAL
ISSUER YIELD AMOUNT VALUE(a)
REPURCHASE AGREEMENTS (CONT.)
Mizuho Securities USA, Inc.
dated 07-30-10, matures 08-02-10,
repurchase price
$13,281,271 0.240% $13,281,005 $13,281,005
Morgan Stanley
dated 02-22-10, matures 08-23-10,
repurchase price
$25,008,465 0.530 25,000,000 25,000,000
Pershing LLC
dated 07-30-10, matures 08-02-10,
repurchase price
$30,000,775 0.310 30,000,000 30,000,000
RBS Securities, Inc.
dated 04-01-10, matures 09-03-10,
repurchase price
$25,011,180 0.460 25,000,000 25,000,000
UBS Securities LLC
dated 07-30-10, matures 08-02-10,
repurchase price
$25,423,373 0.210 25,422,928 25,422,928
---------------
Total 138,703,933
- -------------------------------------------------------------------------------------
TOTAL INVESTMENTS OF CASH COLLATERAL RECEIVED FOR SECURITIES ON LOAN
(Cost: $671,510,186) $671,510,186
- -------------------------------------------------------------------------------------
TOTAL INVESTMENTS IN SECURITIES
(Cost: $4,261,881,515)(h) $4,387,908,046
=====================================================================================
</Table>
The industries identified above are based on the Global Industry Classification
Standard (GICS), which was developed by, and is the exclusive property of,
Morgan Stanley Capital International Inc. and Standard & Poor's, a division of
The McGraw-Hill Companies, Inc.
INVESTMENTS IN DERIVATIVES
FUTURES CONTRACTS OUTSTANDING AT JULY 31, 2010
<Table>
<Caption>
NUMBER OF UNREALIZED
CONTRACTS NOTIONAL EXPIRATION APPRECIATION
CONTRACT DESCRIPTION LONG (SHORT) MARKET VALUE DATE (DEPRECIATION)
- ------------------------------------------------------------------------------------
S&P 500 Index 171 $46,952,325 Sept. 2010 $22,360
</Table>
NOTES TO PORTFOLIO OF INVESTMENTS
(a) Securities are valued by using policies described in Note 2 to the
financial statements.
(b) Non-income producing.
(c) Foreign security values are stated in U.S. dollars. At July 31, 2010, the
value of foreign securities, excluding short-term securities, represented
0.39% of net assets.
(d) At July 31, 2010, investments in securities included securities valued at
$9,938,160 that were partially pledged as collateral to cover initial
margin deposits on open stock index futures contracts.
(e) At July 31, 2010, security was partially or fully on loan. See Note 7 to
the financial statements.
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 23
PORTFOLIO OF INVESTMENTS (continued) -------------------------------------------
NOTES TO PORTFOLIO OF INVESTMENTS (CONTINUED)
(f) The table below represents securities received as collateral for repurchase
agreements. This collateral, which is generally high quality short-term
obligations, is deposited with the Fund's custodian and, pursuant to the
terms of the repurchase agreement, must have an aggregate market value
greater than or equal to the repurchase price plus accrued interest at all
times. The market value of securities held as collateral for repurchase
agreements is monitored on a daily basis to ensure the existence of the
proper level of collateral.
<Table>
<Caption>
BARCLAYS CAPITAL, INC. (0.460%)
SECURITY DESCRIPTION VALUE(a)
- -----------------------------------------------------------
Banc of America Commercial Mortgage Inc $2,581,438
Bear Stearns Commercial Mortgage Securities 1,410,308
Credit Suisse Mortgage Capital Certificates 2,163,109
Granite Master Issuer PLC 6,293,462
JP Morgan Chase Commercial Mortgage
Securities Corp 1,078,205
LB Commercial Conduit Mortgage Trust 1,684,691
Merrill Lynch Mortgage Trust 1,059,169
Paragon Mortgages PLC 3,251,757
Wachovia Bank Commercial Mortgage Trust 1,477,861
- -----------------------------------------------------------
Total market value of collateral securities $21,000,000
- -----------------------------------------------------------
<Caption>
MIZUHO SECURITIES USA, INC. (0.240%)
SECURITY DESCRIPTION VALUE(a)
- -----------------------------------------------------------
Fannie Mae Pool $4,828,655
Fannie Mae REMICS 3,336,274
Freddie Mac Gold Pool 1,757,756
Freddie Mac Non Gold Pool 74,113
Freddie Mac REMICS 2,220,592
Ginnie Mae I Pool 1,328,004
Ginnie Mae II Pool 1,231
- -----------------------------------------------------------
Total market value of collateral securities $13,546,625
- -----------------------------------------------------------
<Caption>
MORGAN STANLEY (0.530%)
SECURITY DESCRIPTION VALUE(a)
- -----------------------------------------------------------
Banc of America Large Loan Inc $505,154
Bear Stearns Commercial Mortgage Securities 116,768
Citigroup Commercial Mortgage Trust 814,499
Citigroup/Deutsche Bank Commercial Mortgage
Trust 906,397
Commercial Mortgage Pass Through Certificates 1,024,005
Credit Suisse Mortgage Capital Certificates 928,635
Credit Suisse/Morgan Stanley Commercial
Mortgage Certificate 216,188
Federal National Mortgage Association 488,708
GE Capital Commercial Mortgage Corp 27,132
Ginnie Mae I Pool 1,282,793
</Table>
- --------------------------------------------------------------------------------
24 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
NOTES TO PORTFOLIO OF
INVESTMENTS (CONTINUED)
<Table>
<Caption>
MORGAN STANLEY (0.530%) (CONTINUED)
SECURITY DESCRIPTION VALUE(a)
- -----------------------------------------------------------
Ginnie Mae II Pool $5,192,241
Greenwich Capital Commercial Funding Corp 47,487
GS Mortgage Securities Corp II 1,930,229
JP Morgan Chase Commercial Mortgage
Securities Corp 938,821
LB-UBS Commercial Mortgage Trust 1,619,355
Merrill Lynch Floating Trust 273,997
Merrill Lynch Mortgage Trust 741,445
Morgan Stanley Capital I 1,363,447
Morgan Stanley Dean Witter Capital I 4,134
United States Treasury Note/Bond 2,776,738
Wachovia Bank Commercial Mortgage Trust 4,765,342
- -----------------------------------------------------------
Total market value of collateral securities $25,963,515
- -----------------------------------------------------------
<Caption>
PERSHING LLC (0.310%)
SECURITY DESCRIPTION VALUE(a)
- -----------------------------------------------------------
Fannie Mae Benchmark REMIC $77,880
Fannie Mae Pool 12,357,594
Fannie Mae REMICS 1,167,140
Federal Farm Credit Bank 105,197
Federal Home Loan Banks 318,992
Federal Home Loan Mortgage Corp 20,730
Federal National Mortgage Association 2,028
Freddie Mac Gold Pool 3,323,427
Freddie Mac Non Gold Pool 371,318
Freddie Mac REMICS 1,077,394
Ginnie Mae I Pool 673,186
Ginnie Mae II Pool 1,353,760
Government National Mortgage Association 350,705
United States Treasury Inflation Indexed
Bonds 616,604
United States Treasury Note/Bond 6,383,549
United States Treasury Strip Coupon 875,206
United States Treasury Strip Principal 1,525,290
- -----------------------------------------------------------
Total market value of collateral securities $30,600,000
- -----------------------------------------------------------
<Caption>
RBS SECURITIES, INC. (0.460%)
SECURITY DESCRIPTION VALUE(a)
- -----------------------------------------------------------
280 Funding Corp $1,070,243
AH Mortgage Advance Trust 386,829
American Home Mortgage Investment Trust 579,403
Banc of America Commercial Mortgage Inc 766,398
Banc of America Large Loan Inc 1,515,692
</Table>
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 25
PORTFOLIO OF INVESTMENTS (continued) -------------------------------------------
NOTES TO PORTFOLIO OF
INVESTMENTS (CONTINUED)
<Table>
<Caption>
RBS SECURITIES, INC. (0.460%) (CONTINUED)
SECURITY DESCRIPTION VALUE(a)
- -----------------------------------------------------------
Bear Stearns Commercial Mortgage Securities $544,704
Bella Vista Mortgage Trust 26,671
CC Mortgage Funding Corp 161,986
Commercial Mortgage Pass Through Certificates 28,753
Countrywide Home Loan Mortgage Pass Through
Trust 70,322
Credit Suisse First Boston Mortgage
Securities Corp 366,267
Credit Suisse Mortgage Capital Certificates 505,689
First Horizon Alternative Mortgage Securities 30,334
First Republic Mortgage Loan Trust 585,458
Ford Credit Floorplan Master Owner Trust 1,032,749
GE Dealer Floorplan Master Note Trust 100,155
Greenwich Capital Commercial Funding Corp 730,696
GS Mortgage Securities Corp II 1,093,756
Harborview Mortgage Loan Trust 110,200
Harley-Davidson Motorcycle Trust 68,123
JP Morgan Chase Commercial Mortgage
Securities Corp 2,334,019
LB-UBS Commercial Mortgage Trust 2,181,533
Leafs CDO I Ltd 581,171
MLCC Mortgage Investors Inc 2,948
Morgan Stanley Capital I 1,078,906
MortgageIT Trust 51,294
Oak Hill Credit Partners 55,372
Sequoia Mortgage Trust 3,458
Wachovia Bank Commercial Mortgage Trust 9,211,486
WaMu Mortgage Pass Through Certificates 933,089
Wells Fargo Mortgage Backed Securities Trust 42,348
- -----------------------------------------------------------
Total market value of collateral securities $26,250,052
- -----------------------------------------------------------
<Caption>
UBS SECURITIES LLC (0.210%)
SECURITY DESCRIPTION VALUE(a)
- -----------------------------------------------------------
Fannie Mae Interest Strip $5,777,659
Fannie Mae Principal Strip 1,103,615
Federal Farm Credit Bank 3,061,434
Federal Home Loan Mortgage Corp 10,847,684
Freddie Mac Strips 5,141,064
- -----------------------------------------------------------
Total market value of collateral securities $25,931,456
- -----------------------------------------------------------
</Table>
(g) Affiliated Money Market Fund -- See Note 8 to the financial statements. The
rate shown is the seven-day current annualized yield at July 31, 2010.
- --------------------------------------------------------------------------------
26 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
NOTES TO PORTFOLIO OF INVESTMENTS (CONTINUED)
(h) At July 31, 2010, the cost of securities for federal income tax purposes
was $4,304,621,757 and the aggregate gross unrealized appreciation and
depreciation based on that cost was:
<Table>
Unrealized appreciation $272,769,102
Unrealized depreciation (189,482,813)
-----------------------------------------------------------
Net unrealized appreciation $83,286,289
-----------------------------------------------------------
</Table>
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 27
PORTFOLIO OF INVESTMENTS (continued) -------------------------------------------
FAIR VALUE MEASUREMENTS
Generally accepted accounting principles (GAAP) require disclosure regarding the
inputs and valuation techniques used to measure fair value and any changes in
valuation inputs or techniques. In addition, investments shall be disclosed by
major category.
The Fund categorizes its fair value measurements according to a three-level
hierarchy that maximizes the use of observable inputs and minimizes the use of
unobservable inputs by prioritizing that the most observable input be used when
available. Observable inputs are those that market participants would use in
pricing an investment based on market data obtained from sources independent of
the reporting entity. Unobservable inputs are those that reflect the Fund's
assumptions about the information market participants would use in pricing an
investment. An investment's level within the fair value hierarchy is based on
the lowest level of any input that is deemed significant to the asset or
liability's fair value measurement. The input levels are not necessarily an
indication of the risk or liquidity associated with investments at that level.
For example, certain U.S. government securities are generally high quality and
liquid, however, they are reflected as Level 2 because the inputs used to
determine fair value may not always be quoted prices in an active market.
Fair value inputs are summarized in the three broad levels listed below:
- Level 1 -- Valuations based on quoted prices for investments in active
markets that the Fund has the ability to access at the measurement date.
Valuation adjustments are not applied to Level 1 investments.
- Level 2 -- Valuations based on other significant observable inputs
(including quoted prices for similar securities, interest rates,
prepayment speeds, credit risks, etc.).
- Level 3 -- Valuations based on significant unobservable inputs (including
the Fund's own assumptions and judgment in determining the fair value of
investments).
Inputs that are used in determining fair value of an investment may include
price information, credit data, volatility statistics, and other factors. These
inputs can be either observable or unobservable. The availability of observable
inputs can vary between investments, and is affected by various factors such as
the type of investment, and the volume and level of activity for that investment
or similar investments in the marketplace. The inputs will be considered by the
Fund Administrator, along with any other relevant factors in the calculation of
an investment's fair value. The Fund uses prices and inputs that are current as
of the measurement date, which may include periods of market dislocations.
During these periods, the availability of prices and inputs may be reduced for
many investments. This condition could cause an investment to be reclassified
between the various levels within the hierarchy.
Non-U.S. equity securities actively traded in foreign markets may be reflected
in Level 2 despite the availability of closing prices, because the Fund
evaluates and determines whether those closing prices reflect fair value at the
close of the New York Stock Exchange (NYSE) or require adjustment, as described
in Note 2 to the financial statements -- Valuation of securities.
Investments falling into the Level 3 category are primarily supported by quoted
prices from brokers and dealers participating in the market for those
investments. However, these may be classified as
- --------------------------------------------------------------------------------
28 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
FAIR VALUE MEASUREMENTS (CONTINUED)
Level 3 investments due to lack of market transparency and corroboration to
support these quoted prices. Additionally, valuation models may be used as the
pricing source for any remaining investments classified as Level 3. These models
rely on one or more significant unobservable inputs and/or significant
assumptions by the Fund Administrator. Inputs used in valuations may include,
but are not limited to, financial statement analysis, capital account balances,
discount rates and estimated cash flows, and comparable company data.
The following table is a summary of the inputs used to value the Fund's
investments as of July 31, 2010:
<Table>
<Caption>
FAIR VALUE AT JULY 31, 2010
---------------------------------------------------------------------
LEVEL 1 LEVEL 2
QUOTED PRICES OTHER LEVEL 3
IN ACTIVE SIGNIFICANT SIGNIFICANT
MARKETS FOR OBSERVABLE UNOBSERVABLE
DESCRIPTION(A) IDENTICAL ASSETS(B) INPUTS INPUTS TOTAL
- ------------------------------------------------------------------------------------------------
Equity Securities
Common Stocks $3,689,213,971 $-- $-- $3,689,213,971
- ------------------------------------------------------------------------------------------------
Total Equity Securities 3,689,213,971 -- -- 3,689,213,971
- ------------------------------------------------------------------------------------------------
Other
Affiliated Money
Market Fund(c) 27,183,889 -- -- 27,183,889
Investments of Cash
Collateral Received
for Securities on
Loan -- 671,510,186 -- 671,510,186
- ------------------------------------------------------------------------------------------------
Total Other 27,183,889 671,510,186 -- 698,694,075
- ------------------------------------------------------------------------------------------------
Investments in
Securities 3,716,397,860 671,510,186 -- 4,387,908,046
Other Financial
Instruments(d) 22,360 -- -- 22,360
- ------------------------------------------------------------------------------------------------
Total $3,716,420,220 $671,510,186 $-- $4,387,930,406
- ------------------------------------------------------------------------------------------------
</Table>
(a) See the Portfolio of Investments for all investment classifications not
indicated in the table.
(b) There were no significant transfers between Levels 1 and 2 during the
period.
(c) Money market fund that is a sweep investment for cash balances in the Fund
at July 31, 2010.
(d) Other Financial Instruments are derivative instruments, which are valued at
the unrealized appreciation (depreciation) on the instrument. Derivative
descriptions are located in the Investments in Derivatives section of the
Portfolio of Investments.
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 29
PORTFOLIO OF INVESTMENTS (continued) -------------------------------------------
HOW TO FIND INFORMATION ABOUT THE FUND'S QUARTERLY PORTFOLIO HOLDINGS
(i) The Fund files its complete schedule of portfolio holdings with the
Securities and Exchange Commission (Commission) for the first and third
quarters of each fiscal year on Form N-Q;
(ii) The Fund's Forms N-Q are available on the Commission's website at
http://www.sec.gov;
(iii)The Fund's Forms N-Q may be reviewed and copied at the Commission's Public
Reference Room in Washington, DC (information on the operations of the
Public Reference Room may be obtained by calling 800.SEC.0330); and
(iv) The Fund's complete schedule of portfolio holdings, as filed on Form N-Q,
can be obtained without charge, upon request, by calling 800.345.6611.
- --------------------------------------------------------------------------------
30 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
STATEMENT OF ASSETS AND LIABILITIES --------------------------------------------
JULY 31, 2010
<Table>
<Caption>
ASSETS
Investments in securities, at value
Unaffiliated issuers* (identified cost $3,563,187,440) $ 3,689,213,971
Affiliated money market fund (identified cost $27,183,889) 27,183,889
Investments of cash collateral received for securities on loan
(identified cost $671,510,186) 671,510,186
- -----------------------------------------------------------------------------------------
Total investments in securities (identified cost $4,261,881,515) 4,387,908,046
Cash 1,420,910
Receivable from Investment Manager 15,882
Capital shares receivable 50,977,976
Dividends and accrued interest receivable 6,107,368
Receivable for investment securities sold 194,924,457
Variation margin receivable on futures contracts 47,072
Other receivables (Note 11) 390,262
Other assets 22,506
- -----------------------------------------------------------------------------------------
Total assets 4,641,814,479
- -----------------------------------------------------------------------------------------
LIABILITIES
Capital shares payable 53,716,966
Payable for investment securities purchased 174,146,735
Payable upon return of securities loaned 671,510,186
Accrued investment management services fees 57,933
Accrued distribution fees 26,843
Accrued transfer agency fees 28,495
Accrued administrative services fees 5,128
Accrued plan administration services fees 1,125
Other accrued expenses 425,220
- -----------------------------------------------------------------------------------------
Total liabilities 899,918,631
- -----------------------------------------------------------------------------------------
Net assets applicable to outstanding capital stock $ 3,741,895,848
- -----------------------------------------------------------------------------------------
REPRESENTED BY
Capital stock -- $.01 par value $ 7,894,409
Additional paid-in capital 6,291,385,685
Excess of distributions over net investment income (366,709)
Accumulated net realized gain (loss) (2,683,106,271)
Unrealized appreciation (depreciation) on investments
and on translation of assets and liabilities in foreign currencies 126,088,734
- -----------------------------------------------------------------------------------------
Total -- representing net assets applicable to outstanding capital stock $ 3,741,895,848
- -----------------------------------------------------------------------------------------
*Value of securities on loan $ 656,224,229
- -----------------------------------------------------------------------------------------
</Table>
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 31
STATEMENT OF ASSETS AND LIABILITIES (continued) --------------------------------
JULY 31, 2010
<Table>
<Caption>
NET ASSET VALUE PER SHARE
NET ASSETS SHARES OUTSTANDING NET ASSET VALUE PER SHARE
Class A $2,688,843,397 567,423,999 $4.74(1)
Class B $ 153,325,657 32,554,969 $4.71
Class C $ 21,982,264 4,714,140 $4.66
Class I $ 314,250,741 65,856,337 $4.77
Class R2 $ 2,193,578 463,276 $4.73
Class R3 $ 6,033 1,273 $4.74
Class R4 $ 162,518,882 34,154,804 $4.76
Class R5 $ 24,848,139 5,229,982 $4.75
Class W $ 373,927,157 79,042,111 $4.73
- --------------------------------------------------------------------------------
</Table>
(1) The maximum offering price per share for Class A is $5.03. The offering
price is calculated by dividing the net asset value by 1.0 minus the maximum
sales charge of 5.75%.
The accompanying Notes to Financial Statements are an integral part of this
statement.
- --------------------------------------------------------------------------------
32 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
STATEMENT OF OPERATIONS --------------------------------------------------------
YEAR ENDED JULY 31, 2010
<Table>
<Caption>
INVESTMENT INCOME
Income:
Dividends $ 80,541,644
Interest 141,328
Income distributions from affiliated money market fund 52,082
Income from securities lending -- net 2,078,072
- ---------------------------------------------------------------------------
Total income 82,813,126
- ---------------------------------------------------------------------------
Expenses:
Investment management services fees 21,017,705
Distribution fees
Class A 6,447,567
Class B 1,947,821
Class C 209,143
Class R2 9,201
Class R3 14
Class W 1,372,152
Transfer agency fees
Class A 7,430,055
Class B 612,484
Class C 63,914
Class R2 998
Class R3 3
Class R4 84,561
Class R5 11,896
Class W 1,113,980
Administrative services fees 1,911,088
Plan administration services fees
Class R2 4,600
Class R3 14
Class R4 392,930
Compensation of board members 121,011
Custodian fees 40,205
Printing and postage 272,091
Registration fees 91,483
Professional fees 80,886
Other 174,511
- ---------------------------------------------------------------------------
Total expenses 43,410,313
Expenses waived/reimbursed by the Investment Manager and
its affiliates (4,892,494)
- ---------------------------------------------------------------------------
Total net expenses 38,517,819
- ---------------------------------------------------------------------------
Investment income (loss) -- net 44,295,307
- ---------------------------------------------------------------------------
</Table>
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 33
STATEMENT OF OPERATIONS (continued) --------------------------------------------
YEAR ENDED JULY 31, 2010
<Table>
<Caption>
REALIZED AND UNREALIZED GAIN (LOSS) -- NET
Net realized gain (loss) on:
Security transactions $(143,597,040)
Foreign currency transactions (12,934)
Futures contracts 7,465,395
- ---------------------------------------------------------------------------
Net realized gain (loss) on investments (136,144,579)
Net change in unrealized appreciation (depreciation) on
investments
and on translation of assets and liabilities in foreign
currencies 518,165,657
- ---------------------------------------------------------------------------
Net gain (loss) on investments and foreign currencies 382,021,078
- ---------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
operations $ 426,316,385
- ---------------------------------------------------------------------------
</Table>
The accompanying Notes to Financial Statements are an integral part of this
statement.
- --------------------------------------------------------------------------------
34 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
STATEMENTS OF CHANGES IN NET ASSETS --------------------------------------------
<Table>
<Caption>
YEAR ENDED JULY 31, 2010 2009
OPERATIONS AND DISTRIBUTIONS
Investment income (loss) -- net $ 44,295,307 $ 43,892,499
Net realized gain (loss) on investments (136,144,579) (711,417,634)
Net change in unrealized appreciation (depreciation) on
investments and on translation of assets and liabilities
in foreign currencies 518,165,657 (44,531,092)
- ---------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
operations 426,316,385 (712,056,227)
- ---------------------------------------------------------------------------------------------
Distributions to shareholders from:
Net investment income
Class A (46,395,739) (9,214,426)
Class B (2,071,740) --
Class C (237,652) (7,117)
Class I (13,083,100) (5,438,440)
Class R2 (17,934) (33)
Class R3 (128) (42)
Class R4 (3,996,938) (1,326,570)
Class R5 (279,981) (49)
Class W (21,497,369) (10,297,303)
Net realized gain
Class A -- (24,419,810)
Class B -- (803,415)
Class C -- (70,547)
Class I -- (10,144,769)
Class R2 -- (97)
Class R3 -- (96)
Class R4 -- (2,985,348)
Class R5 -- (96)
Class W -- (30,699,663)
- ---------------------------------------------------------------------------------------------
Total distributions (87,580,581) (95,407,821)
- ---------------------------------------------------------------------------------------------
</Table>
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 35
STATEMENTS OF CHANGES IN NET ASSETS (continued) --------------------------------
<Table>
<Caption>
YEAR ENDED JULY 31, 2010 2009
CAPITAL SHARE TRANSACTIONS
Proceeds from sales
Class A shares $ 51,073,321 $ 28,702,122
Class B shares 10,668,758 2,141,651
Class C shares 2,714,874 553,812
Class I shares 49,322,036 101,166,985
Class R2 shares 808,574 --
Class R4 shares 19,843,167 11,162,166
Class R5 shares 3,187,831 --
Class W shares 80,620,665 333,646,211
Fund mergers (Note 10)
Class A shares 2,145,265,006 N/A
Class B shares 204,721,762 N/A
Class C shares 20,969,821 N/A
Class I shares 37,568,585 N/A
Class R2 shares 1,877,697 N/A
Class R3 shares 2,732 N/A
Class R4 shares 71,155,805 N/A
Class R5 shares 24,248,507 N/A
Reinvestment of distributions at net asset value
Class A shares 43,353,611 31,091,644
Class B shares 2,051,626 793,672
Class C shares 213,339 73,505
Class I shares 13,082,819 15,582,928
Class R2 shares 3,125 --
Class R4 shares 3,996,912 4,311,918
Class R5 shares 279,835 --
Class W shares 21,497,270 40,996,838
Conversions from Class B to Class A
Class A shares 49,970,227 4,943,185
Class B shares (49,970,227) (4,943,185)
Payments for redemptions
Class A shares (499,521,241) (154,038,553)
Class B shares (43,428,507) (8,152,830)
Class C shares (5,468,056) (569,142)
Class I shares (151,534,615) (70,748,251)
Class R2 shares (607,266) --
Class R4 shares (35,727,247) (18,348,722)
Class R5 shares (4,432,299) --
Class W shares (521,649,465) (632,276,771)
- ---------------------------------------------------------------------------------------------
Increase (decrease) in net assets from capital share
transactions 1,546,158,982 (313,910,817)
- ---------------------------------------------------------------------------------------------
Total increase (decrease) in net assets 1,884,894,786 (1,121,374,865)
Net assets at beginning of year 1,857,001,062 2,978,375,927
- ---------------------------------------------------------------------------------------------
Net assets at end of year $3,741,895,848 $ 1,857,001,062
- ---------------------------------------------------------------------------------------------
Undistributed (excess of distributions over) net investment
income $ (366,709) $ 43,755,766
- ---------------------------------------------------------------------------------------------
</Table>
The accompanying Notes to Financial Statements are an integral part of this
statement.
- --------------------------------------------------------------------------------
36 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
FINANCIAL HIGHLIGHTS -----------------------------------------------------------
The following tables are intended to help you understand the Fund's financial
performance. Certain information reflects financial results for a single share
of a class held for the periods shown. For periods ended 2007 and after, per
share net investment income (loss) amounts are calculated based on average
shares outstanding during the period. Total returns assume reinvestment of all
dividends and distributions. Total returns do not reflect payment of sales
charges, if any, and are not annualized for periods of less than one year.
<Table>
<Caption>
YEAR ENDED JULY 31,
CLASS A --------------------------------------------------------
PER SHARE DATA 2010 2009 2008 2007 2006
Net asset value, beginning of period $4.30 $5.88 $7.22 $6.74 $6.70
- -----------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) .05 .09 .09 .08 .06
Net gains (losses) (both realized and
unrealized) .54 (1.47) (1.00) .97 .35
- -----------------------------------------------------------------------------------------------------------
Total from investment operations .59 (1.38) (.91) 1.05 .41
- -----------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends from net investment income (.15) (.05) (.06) (.06) (.06)
Distributions from realized gains -- (.15) (.37) (.51) (.31)
- -----------------------------------------------------------------------------------------------------------
Total distributions (.15) (.20) (.43) (.57) (.37)
- -----------------------------------------------------------------------------------------------------------
Net asset value, end of period $4.74 $4.30 $5.88 $7.22 $6.74
- -----------------------------------------------------------------------------------------------------------
TOTAL RETURN 14.03% (23.19%) (13.40%) 15.92% 6.25%
- -----------------------------------------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS(a)
Gross expenses prior to expense
waiver/reimbursement 1.15% .96% .96% 1.05% 1.05%
- -----------------------------------------------------------------------------------------------------------
Net expenses after expense
waiver/reimbursement(b) 1.00% .95% .96% 1.03% 1.02%
- -----------------------------------------------------------------------------------------------------------
Net investment income (loss) 1.10% 2.11% 1.35% 1.13% .95%
- -----------------------------------------------------------------------------------------------------------
SUPPLEMENTAL DATA
Net assets, end of period (in millions) $2,689 $692 $1,067 $1,410 $1,368
- -----------------------------------------------------------------------------------------------------------
Portfolio turnover rate 75% 61% 58% 62% 137%
- -----------------------------------------------------------------------------------------------------------
</Table>
See accompanying Notes to Financial Highlights.
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 37
FINANCIAL HIGHLIGHTS (continued) -----------------------------------------------
<Table>
<Caption>
YEAR ENDED JULY 31,
CLASS B -------------------------------------------------------
PER SHARE DATA 2010 2009 2008 2007 2006
Net asset value, beginning of period $4.27 $5.80 $7.12 $6.65 $6.62
- ----------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) .01 .06 .04 .03 .01
Net gains (losses) (both realized and
unrealized) .54 (1.44) (.99) .96 .34
- ----------------------------------------------------------------------------------------------------------
Total from investment operations .55 (1.38) (.95) .99 .35
- ----------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends from net investment income (.11) -- -- (.01) (.01)
Distributions from realized gains -- (.15) (.37) (.51) (.31)
- ----------------------------------------------------------------------------------------------------------
Total distributions (.11) (.15) (.37) (.52) (.32)
- ----------------------------------------------------------------------------------------------------------
Net asset value, end of period $4.71 $4.27 $5.80 $7.12 $6.65
- ----------------------------------------------------------------------------------------------------------
TOTAL RETURN 13.03% (23.68%) (14.07%) 15.18% 5.42%
- ----------------------------------------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS(a)
Gross expenses prior to expense
waiver/reimbursement 1.93% 1.73% 1.72% 1.82% 1.85%
- ----------------------------------------------------------------------------------------------------------
Net expenses after expense
waiver/reimbursement(b) 1.78% 1.71% 1.72% 1.79% 1.82%
- ----------------------------------------------------------------------------------------------------------
Net investment income (loss) .29% 1.35% .59% .37% .20%
- ----------------------------------------------------------------------------------------------------------
SUPPLEMENTAL DATA
Net assets, end of period (in millions) $153 $16 $35 $62 $73
- ----------------------------------------------------------------------------------------------------------
Portfolio turnover rate 75% 61% 58% 62% 137%
- ----------------------------------------------------------------------------------------------------------
</Table>
See accompanying Notes to Financial Highlights.
- --------------------------------------------------------------------------------
38 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
<Table>
<Caption>
YEAR ENDED JULY 31,
CLASS C -------------------------------------------------------
PER SHARE DATA 2010 2009 2008 2007 2006
Net asset value, beginning of period $4.24 $5.78 $7.11 $6.65 $6.62
- ----------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) .01 .06 .04 .03 .01
Net gains (losses) (both realized and
unrealized) .53 (1.44) (.99) .96 .35
- ----------------------------------------------------------------------------------------------------------
Total from investment operations .54 (1.38) (.95) .99 .36
- ----------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends from net investment income (.12) (.01) (.01) (.02) (.02)
Distributions from realized gains -- (.15) (.37) (.51) (.31)
- ----------------------------------------------------------------------------------------------------------
Total distributions (.12) (.16) (.38) (.53) (.33)
- ----------------------------------------------------------------------------------------------------------
Net asset value, end of period $4.66 $4.24 $5.78 $7.11 $6.65
- ----------------------------------------------------------------------------------------------------------
TOTAL RETURN 12.97% (23.66%) (14.11%) 15.14% 5.51%
- ----------------------------------------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS(a)
Gross expenses prior to expense
waiver/reimbursement 1.92% 1.72% 1.72% 1.81% 1.84%
- ----------------------------------------------------------------------------------------------------------
Net expenses after expense
waiver/reimbursement(b) 1.77% 1.71% 1.72% 1.79% 1.81%
- ----------------------------------------------------------------------------------------------------------
Net investment income (loss) .31% 1.35% .59% .36% .20%
- ----------------------------------------------------------------------------------------------------------
SUPPLEMENTAL DATA
Net assets, end of period (in millions) $22 $2 $3 $3 $3
- ----------------------------------------------------------------------------------------------------------
Portfolio turnover rate 75% 61% 58% 62% 137%
- ----------------------------------------------------------------------------------------------------------
</Table>
See accompanying Notes to Financial Highlights.
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 39
FINANCIAL HIGHLIGHTS (continued) -----------------------------------------------
<Table>
<Caption>
YEAR ENDED JULY 31,
CLASS I -------------------------------------------------------
PER SHARE DATA 2010 2009 2008 2007 2006
Net asset value, beginning of period $4.33 $5.93 $7.27 $6.78 $6.73
- ----------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) .08 .11 .11 .11 .08
Net gains (losses) (both realized and
unrealized) .53 (1.49) (.99) .97 .36
- ----------------------------------------------------------------------------------------------------------
Total from investment operations .61 (1.38) (.88) 1.08 .44
- ----------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends from net investment income (.17) (.07) (.09) (.08) (.08)
Distributions from realized gains -- (.15) (.37) (.51) (.31)
- ----------------------------------------------------------------------------------------------------------
Total distributions (.17) (.22) (.46) (.59) (.39)
- ----------------------------------------------------------------------------------------------------------
Net asset value, end of period $4.77 $4.33 $5.93 $7.27 $6.78
- ----------------------------------------------------------------------------------------------------------
TOTAL RETURN 14.38% (22.90%) (12.98%) 16.29% 6.73%
- ----------------------------------------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS(a)
Gross expenses prior to expense
waiver/reimbursement .61% .56% .61% .70% .72%
- ----------------------------------------------------------------------------------------------------------
Net expenses after expense
waiver/reimbursement(b) .54% .56% .61% .67% .70%
- ----------------------------------------------------------------------------------------------------------
Net investment income (loss) 1.66% 2.51% 1.69% 1.47% 1.41%
- ----------------------------------------------------------------------------------------------------------
SUPPLEMENTAL DATA
Net assets, end of period (in millions) $314 $332 $391 $441 $252
- ----------------------------------------------------------------------------------------------------------
Portfolio turnover rate 75% 61% 58% 62% 137%
- ----------------------------------------------------------------------------------------------------------
</Table>
See accompanying Notes to Financial Highlights.
- --------------------------------------------------------------------------------
40 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
<Table>
<Caption>
YEAR ENDED JULY 31,
CLASS R2 ---------------------------------------------
PER SHARE DATA 2010 2009 2008 2007(c)
Net asset value, beginning of period $4.30 $5.88 $7.21 $7.57
- ------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) .03 .08 .08 .03
Net gains (losses) (both realized and
unrealized) .54 (1.47) (1.00) .20
- ------------------------------------------------------------------------------------------------
Total from investment operations .57 (1.39) (.92) .23
- ------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends from net investment income (.14) (.04) (.04) (.08)
Distributions from realized gains -- (.15) (.37) (.51)
- ------------------------------------------------------------------------------------------------
Total distributions (.14) (.19) (.41) (.59)
- ------------------------------------------------------------------------------------------------
Net asset value, end of period $4.73 $4.30 $5.88 $7.21
- ------------------------------------------------------------------------------------------------
TOTAL RETURN 13.43% (23.30%) (13.51%) 3.31%
- ------------------------------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS(a)
Gross expenses prior to expense waiver/
reimbursement 1.43% 1.32% 1.41% 1.49%(d)
- ------------------------------------------------------------------------------------------------
Net expenses after expense
waiver/reimbursement(b) 1.36% 1.16% 1.16% 1.48%(d)
- ------------------------------------------------------------------------------------------------
Net investment income (loss) .71% 1.92% 1.15% .55%(d)
- ------------------------------------------------------------------------------------------------
SUPPLEMENTAL DATA
Net assets, end of period (in millions) $2 $-- $-- $--
- ------------------------------------------------------------------------------------------------
Portfolio turnover rate 75% 61% 58% 62%
- ------------------------------------------------------------------------------------------------
</Table>
See accompanying Notes to Financial Highlights.
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 41
FINANCIAL HIGHLIGHTS (continued) -----------------------------------------------
<Table>
<Caption>
YEAR ENDED JULY 31,
CLASS R3 ---------------------------------------------
PER SHARE DATA 2010 2009 2008 2007(c)
Net asset value, beginning of period $4.30 $5.89 $7.22 $7.57
- ------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) .05 .09 .09 .04
Net gains (losses) (both realized and
unrealized) .54 (1.47) (.99) .20
- ------------------------------------------------------------------------------------------------
Total from investment operations .59 (1.38) (.90) .24
- ------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends from net investment income (.15) (.06) (.06) (.08)
Distributions from realized gains -- (.15) (.37) (.51)
- ------------------------------------------------------------------------------------------------
Total distributions (.15) (.21) (.43) (.59)
- ------------------------------------------------------------------------------------------------
Net asset value, end of period $4.74 $4.30 $5.89 $7.22
- ------------------------------------------------------------------------------------------------
TOTAL RETURN 13.92% (23.17%) (13.26%) 3.46%
- ------------------------------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS(a)
Gross expenses prior to expense waiver/
reimbursement 1.15% 1.10% 1.15% 1.24%(d)
- ------------------------------------------------------------------------------------------------
Net expenses after expense
waiver/reimbursement(b) 1.10% .94% .90% 1.22%(d)
- ------------------------------------------------------------------------------------------------
Net investment income (loss) 1.05% 2.11% 1.41% .81%(d)
- ------------------------------------------------------------------------------------------------
SUPPLEMENTAL DATA
Net assets, end of period (in millions) $-- $-- $-- $--
- ------------------------------------------------------------------------------------------------
Portfolio turnover rate 75% 61% 58% 62%
- ------------------------------------------------------------------------------------------------
</Table>
See accompanying Notes to Financial Highlights.
- --------------------------------------------------------------------------------
42 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
<Table>
<Caption>
YEAR ENDED JULY 31,
CLASS R4 -------------------------------------------------------
PER SHARE DATA 2010 2009 2008 2007 2006
Net asset value, beginning of period $4.32 $5.91 $7.25 $6.76 $6.71
- ----------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) .06 .10 .10 .09 .07
Net gains (losses) (both realized and
unrealized) .54 (1.48) (1.00) .98 .36
- ----------------------------------------------------------------------------------------------------------
Total from investment operations .60 (1.38) (.90) 1.07 .43
- ----------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends from net investment income (.16) (.06) (.07) (.07) (.07)
Distributions from realized gains -- (.15) (.37) (.51) (.31)
- ----------------------------------------------------------------------------------------------------------
Total distributions (.16) (.21) (.44) (.58) (.38)
- ----------------------------------------------------------------------------------------------------------
Net asset value, end of period $4.76 $4.32 $5.91 $7.25 $6.76
- ----------------------------------------------------------------------------------------------------------
TOTAL RETURN 14.14% (23.05%) (13.26%) 16.15% 6.48%
- ----------------------------------------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS(a)
Gross expenses prior to expense
waiver/reimbursement .92% .86% .91% .95% .87%
- ----------------------------------------------------------------------------------------------------------
Net expenses after expense
waiver/reimbursement(b) .85% .78% .84% .87% .84%
- ----------------------------------------------------------------------------------------------------------
Net investment income (loss) 1.31% 2.28% 1.47% 1.29% 1.10%
- ----------------------------------------------------------------------------------------------------------
SUPPLEMENTAL DATA
Net assets, end of period (in millions) $163 $90 $126 $158 $224
- ----------------------------------------------------------------------------------------------------------
Portfolio turnover rate 75% 61% 58% 62% 137%
- ----------------------------------------------------------------------------------------------------------
</Table>
See accompanying Notes to Financial Highlights.
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 43
FINANCIAL HIGHLIGHTS (continued) -----------------------------------------------
<Table>
<Caption>
YEAR ENDED JULY 31,
CLASS R5 ---------------------------------------------
PER SHARE DATA 2010 2009 2008 2007(c)
Net asset value, beginning of period $4.31 $5.90 $7.24 $7.57
- ------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) .07 .11 .11 .06
Net gains (losses) (both realized and
unrealized) .54 (1.48) (1.00) .20
- ------------------------------------------------------------------------------------------------
Total from investment operations .61 (1.37) (.89) .26
- ------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends from net investment income (.17) (.07) (.08) (.08)
Distributions from realized gains -- (.15) (.37) (.51)
- ------------------------------------------------------------------------------------------------
Total distributions (.17) (.22) (.45) (.59)
- ------------------------------------------------------------------------------------------------
Net asset value, end of period $4.75 $4.31 $5.90 $7.24
- ------------------------------------------------------------------------------------------------
TOTAL RETURN 14.41% (22.91%) (13.09%) 3.76%
- ------------------------------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS(a)
Gross expenses prior to expense waiver/
reimbursement .68% .58% .66% .75%(d)
- ------------------------------------------------------------------------------------------------
Net expenses after expense
waiver/reimbursement(b) .61% .58% .66% .74%(d)
- ------------------------------------------------------------------------------------------------
Net investment income (loss) 1.46% 2.48% 1.66% 1.28%(d)
- ------------------------------------------------------------------------------------------------
SUPPLEMENTAL DATA
Net assets, end of period (in millions) $25 $-- $-- $--
- ------------------------------------------------------------------------------------------------
Portfolio turnover rate 75% 61% 58% 62%
- ------------------------------------------------------------------------------------------------
</Table>
See accompanying Notes to Financial Highlights.
- --------------------------------------------------------------------------------
44 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
<Table>
<Caption>
YEAR ENDED JULY 31,
CLASS W ---------------------------------------------
PER SHARE DATA 2010 2009 2008 2007(e)
Net asset value, beginning of period $4.29 $5.86 $7.22 $7.46
- ------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) .06 .09 .08 .03
Net gains (losses) (both realized and
unrealized) .53 (1.47) (1.00) .32
- ------------------------------------------------------------------------------------------------
Total from investment operations .59 (1.38) (.92) .35
- ------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends from net investment income (.15) (.04) (.07) (.08)
Distributions from realized gains -- (.15) (.37) (.51)
- ------------------------------------------------------------------------------------------------
Total distributions (.15) (.19) (.44) (.59)
- ------------------------------------------------------------------------------------------------
Net asset value, end of period $4.73 $4.29 $5.86 $7.22
- ------------------------------------------------------------------------------------------------
TOTAL RETURN 13.93% (23.21%) (13.52%) 5.01%
- ------------------------------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS(a)
Gross expenses prior to expense waiver/
reimbursement 1.05% 1.01% 1.06% 1.18%(d)
- ------------------------------------------------------------------------------------------------
Net expenses after expense
waiver/reimbursement(b) .98% 1.01% 1.06% 1.13%(d)
- ------------------------------------------------------------------------------------------------
Net investment income (loss) 1.27% 2.07% 1.22% .59%(d)
- ------------------------------------------------------------------------------------------------
SUPPLEMENTAL DATA
Net assets, end of period (in millions) $374 $726 $1,355 $745
- ------------------------------------------------------------------------------------------------
Portfolio turnover rate 75% 61% 58% 62%
- ------------------------------------------------------------------------------------------------
</Table>
NOTES TO FINANCIAL HIGHLIGHTS
(a) Includes the impact of a performance incentive adjustment, if any. In
addition to the fees and expenses which the Fund bears directly, the Fund
indirectly bears a pro rata share of the fees and expenses of the acquired
funds in which it invests. Such indirect expenses are not included in the
reported expense ratios.
(b) The Investment Manager and its affiliates agreed to waive/reimburse certain
fees and expenses (excluding fees and expenses of acquired funds), before
giving effect to any performance incentive adjustment.
(c) For the period from Dec. 11, 2006 (when shares became publicly available) to
July 31, 2007.
(d) Annualized.
(e) For the period from Dec. 1, 2006 (when shares became publicly available) to
July 31, 2007.
The accompanying Notes to Financial Statements are an integral part of this
statement.
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 45
NOTES TO FINANCIAL STATEMENTS --------------------------------------------------
1. ORGANIZATION
Columbia Large Core Quantitative Fund (formerly known as RiverSource Disciplined
Equity Fund) (the Fund) is a series of RiverSource Large Cap Series, Inc. (the
Corporation) and is registered under the Investment Company Act of 1940, as
amended (the 1940 Act), as a diversified, open-end management investment
company. The Corporation has 10 billion authorized shares of capital stock that
can be allocated among the separate series as designated by the Corporation's
Board of Directors (the Board). The Fund invests primarily in equity securities
of companies listed on U.S. exchanges with market capitalizations greater than
$5 billion at the time of purchase.
The Fund offers Class A, Class B, Class C, Class I, Class R2, Class R3, Class
R4, Class R5 and Class W shares.
- - Class A shares are offered with a front-end sales charge, which may be waived
under certain circumstances.
- - Class B shares may be subject to a contingent deferred sales charge (CDSC)
and automatically convert to Class A shares one month after the completion of
the eighth year of ownership if originally purchased in a RiverSource fund on
or after May 21, 2005 or originally purchased in a Seligman fund on or after
June 13, 2009. Class B shares originally purchased in a RiverSource fund
prior to May 21, 2005 will convert to Class A shares in the ninth calendar
year of ownership. Class B shares originally purchased in a Seligman fund
prior to June 13, 2009 will convert to Class A shares in the month prior to
the ninth year of ownership. Effective Sept. 7, 2010, the Fund no longer
accepts investments from new or existing investors in the Fund's Class B
shares, except that (i) dividend and/or capital gain distributions may
continue to be reinvested in Class B shares of the Fund and (ii) shareholders
invested in Class B shares of the Fund may exchange those shares for Class B
shares of other Columbia, Columbia Acorn, RiverSource, Seligman and
Threadneedle funds offering such shares.
- - Class C shares may be subject to a CDSC.
- - Class I, Class R2, Class R3, Class R4 and Class R5 shares are offered without
a front-end sales charge or CDSC to qualifying institutional investors.
Effective July 23, 2010, the Fund no longer offers Class R3 shares. Effective
Sept. 7, 2010, Class R2 shares were renamed Class R shares.
- - Class W shares are offered without a front-end sales charge or CDSC and are
offered through qualifying discretionary accounts.
At July 31, 2010, Columbia Management Investment Advisers, LLC (formerly known
as RiverSource Investments, LLC) (the Investment Manager) and
- --------------------------------------------------------------------------------
46 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
affiliated funds-of-funds owned 100% of Class I shares, and the Investment
Manager owned 100% of Class R3 shares.
All classes of shares have identical voting, dividend and liquidation rights.
Class specific expenses (e.g., distribution and service fees, transfer agency
fees, plan administration services fees) differ among classes. Income, expenses
(other than class specific expenses) and realized and unrealized gains or losses
on investments are allocated to each class of shares based upon its relative net
assets.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
USE OF ESTIMATES
Preparing financial statements that conform to U.S. generally accepted
accounting principles requires management to make estimates (e.g., on assets,
liabilities and contingent assets and liabilities) that could differ from actual
results.
VALUATION OF SECURITIES
All securities are valued at the close of business of the New York Stock
Exchange (NYSE). Securities traded on national securities exchanges or included
in national market systems are valued at the last quoted sales price from the
primary exchange. Debt securities are generally traded in the over-the-counter
market and are valued by an independent pricing service using an evaluated bid.
When market quotes are not readily available, the pricing service, in
determining fair values of debt securities, takes into consideration such
factors as current quotations by broker/dealers, coupon, maturity, quality, type
of issue, trading characteristics, and other yield and risk factors it deems
relevant in determining valuations. Foreign securities are valued based on
quotations from the principal market in which such securities are normally
traded. The procedures adopted by the Board generally contemplate the use of
fair valuation in the event that price quotations or valuations are not readily
available, price quotations or valuations from other sources are not reflective
of market value and thus deemed unreliable, or a significant event has occurred
in relation to a security or class of securities (such as foreign securities)
that is not reflected in price quotations or valuations from other sources. A
fair value price is a good faith estimate of the value of a security at a given
point in time.
Many securities markets and exchanges outside the U.S. close prior to the close
of the NYSE and therefore the closing prices for securities in such markets or
on such exchanges may not fully reflect events that occur after such close but
before the close of the NYSE, including significant movements in the U.S. market
after foreign exchanges have closed. Accordingly, in those situations,
Ameriprise Financial, Inc. (Ameriprise Financial), parent company of the
Investment
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 47
NOTES TO FINANCIAL STATEMENTS (continued) --------------------------------------
Manager, as administrator to the Fund, will fair value foreign securities
pursuant to procedures adopted by the Board, including utilizing a third party
pricing service to determine these fair values. These procedures take into
account multiple factors, including movements in the U.S. securities markets, to
determine a good faith estimate that reasonably reflects the current market
conditions as of the close of the NYSE. The fair value of a security is likely
to be different from the quoted or published price, if available.
Short-term securities maturing in more than 60 days from the valuation date are
valued at the market price or approximate market value based on current interest
rates. Typically, those maturing in 60 days or less that originally had
maturities of more than 60 days at acquisition date are valued at amortized cost
using the market value on the 61(st) day before maturity. Short-term securities
maturing in 60 days or less at acquisition date are valued at amortized cost.
Amortized cost is an approximation of market value. Investments in money market
funds are valued at net asset value.
FOREIGN CURRENCY TRANSLATIONS
Securities and other assets and liabilities denominated in foreign currencies
are translated daily into U.S. dollars. Foreign currency amounts related to the
purchase or sale of securities and income and expenses are translated at the
exchange rate on the transaction date. The effect of changes in foreign exchange
rates on realized and unrealized security gains or losses is reflected as a
component of such gains or losses. In the Statement of Operations, net realized
gains or losses from foreign currency transactions, if any, may arise from sales
of foreign currency, closed forward contracts, exchange gains or losses realized
between the trade date and settlement date on securities transactions, and other
translation gains or losses on dividends, interest income and foreign
withholding taxes.
REPURCHASE AGREEMENTS
The Fund may enter into repurchase agreements. Generally, securities received as
collateral subject to repurchase agreements are deposited with the Fund's
custodian and, pursuant to the terms of the repurchase agreement, must have an
aggregate market value greater than or equal to the repurchase price plus
accrued interest at all times. The market value of securities held as collateral
for repurchase agreements is monitored on a daily basis to ensure the existence
of the proper level of collateral.
GUARANTEES AND INDEMNIFICATIONS
Under the Fund's organizational documents, its officers and directors are
indemnified against certain liabilities arising out of the performance of their
duties to the Fund. In addition, certain of the Fund's contracts with its
service providers contain general indemnification clauses. The Fund's maximum
- --------------------------------------------------------------------------------
48 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
exposure under these arrangements is unknown since the amount of any future
claims that may be made against the Fund cannot be determined and the Fund has
no historical basis for predicting the likelihood of any such claims.
FEDERAL TAXES
The Fund's policy is to comply with Subchapter M of the Internal Revenue Code
that applies to regulated investment companies and to distribute substantially
all of its taxable income (which includes net short-term capital gains) to
shareholders. No provision for income or excise taxes is thus required.
Management of the Fund has concluded that there are no significant uncertain tax
positions that would require recognition in the financial statements. Generally,
the tax authorities can examine all tax returns filed for the last three years.
FOREIGN CAPITAL GAINS TAXES
Realized gains in certain countries may be subject to foreign taxes at the fund
level, at rates ranging from approximately 10% to 15%. The Fund pays such
foreign taxes on net realized gains at the appropriate rate for each
jurisdiction.
DIVIDENDS TO SHAREHOLDERS
An annual dividend from net investment income, declared and paid at the end of
the calendar year, when available, is reinvested in additional shares of the
Fund at net asset value or payable in cash. Capital gains, when available, are
normally distributed along with the income dividend. On Sept. 9, 2009, an
additional dividend was paid before the mergers (see Note 10) to ensure that the
current shareholders of Columbia Large Core Quantitative Fund would not
experience a dilution in their shares of the Fund's income or capital gains.
OTHER
Security transactions are accounted for on the date securities are purchased or
sold. Dividend income is recognized on the ex-dividend date and interest income,
including amortization of premium, market discount and original issue discount
using the effective interest method, is accrued daily.
3. INVESTMENTS IN DERIVATIVES
The Fund may invest in certain derivative instruments, which are transactions
whose values depend on or are derived from (in whole or in part) the value of
one or more other assets, such as securities, currencies, commodities or
indices. Such derivative instruments may be used to maintain cash reserves while
maintaining exposure to certain other assets, to offset anticipated declines in
values of investments, to facilitate trading, to reduce transaction costs, and
to pursue higher investment returns. The Fund may also use derivative
instruments to mitigate certain investment risks, such as foreign currency
exchange rate risk,
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 49
NOTES TO FINANCIAL STATEMENTS (continued) --------------------------------------
interest rate risk, and credit risk. Investments in derivative instruments may
expose the Fund to certain additional risks, including those detailed below.
FORWARD FOREIGN CURRENCY CONTRACTS
The Fund may enter into forward foreign currency contracts in connection with
settling purchases or sales of securities, to hedge the currency exposure
associated with some or all of the Fund's securities or as part of its
investment strategy. A forward foreign currency contract is an agreement between
two parties to buy and sell a currency at a set price on a future date. The
market value of a forward foreign currency contract fluctuates with changes in
foreign currency exchange rates. Forward foreign currency contracts are marked
to market daily based upon foreign currency exchange rates from an independent
pricing service and the change in value is recorded as unrealized appreciation
or depreciation. The Fund will record a realized gain or loss when the forward
foreign currency contract is closed.
The risks of forward foreign currency contracts include movement in the values
of the foreign currencies relative to the U.S. dollar (or other foreign
currencies) and the possibility that the counterparty will not complete its
contractual obligation, which may be in excess of the amount, if any, reflected
in the Statement of Assets and Liabilities. At July 31, 2010, the Fund had no
outstanding forward foreign currency contracts.
FUTURES TRANSACTIONS
The Fund may buy and sell financial futures contracts traded on any U.S. or
foreign exchange to produce incremental earnings, hedge existing positions or
protect against market changes in the value of equities, interest rates or
foreign currencies. The Fund may also buy and write put and call options on
these futures contracts. A futures contract represents a commitment for the
future purchase or sale of an asset at a specified price on a specified date.
Futures and options on futures are valued daily based upon the last sale price
at the close of the market on the principal exchange on which they are traded.
Upon entering into a futures contract, the Fund is required to deposit either
cash or securities in an amount (initial margin) equal to a certain percentage
of the contract value. Subsequent payments (variation margin) are made or
received by the Fund each day. The variation margin payments are equal to the
daily changes in the contract value and are recorded as unrealized gains and
losses. The Fund recognizes a realized gain or loss when the contract is closed
or expires.
Upon entering into futures contracts, the Fund bears the risk of interest rates,
exchange rates or securities prices moving unexpectedly, in which case, the Fund
may not achieve the anticipated benefits of the futures contracts and may
realize a loss. Additional risks include counterparty credit risk, the
possibility of an
- --------------------------------------------------------------------------------
50 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
illiquid market, and that a change in the value of the contract or option may
not correlate with changes in the value of the underlying securities.
EFFECTS OF DERIVATIVE TRANSACTIONS ON THE FINANCIAL STATEMENTS
The following tables are intended to provide additional information about the
effect of derivatives on the financial statements of the Fund including: the
fair value of derivatives by risk category and the location of those fair values
in the Statement of Assets and Liabilities; the impact of derivative
transactions on the Fund's operations over the period including realized gains
or losses and unrealized gains or losses. The derivative schedules following the
Portfolio of Investments present additional information regarding derivative
instruments outstanding at the end of the period, if any.
FAIR VALUES OF DERIVATIVE INSTRUMENTS AT JULY 31, 2010
<Table>
<Caption>
ASSET DERIVATIVES LIABILITY DERIVATIVES
-------------------------------- -------------------------------
STATEMENT OF ASSETS STATEMENT OF ASSETS
RISK EXPOSURE AND LIABILITIES AND LIABILITIES
CATEGORY LOCATION FAIR VALUE LOCATION FAIR VALUE
- ---------------------------------------------------------------------------------------------
Net
assets -- unrealized
appreciation on
Equity contracts investments $22,360* N/A N/A
- ---------------------------------------------------------------------------------------------
</Table>
* Includes cumulative appreciation (depreciation) of futures contracts as
reported in the Futures Contracts Outstanding table following the Portfolio
of Investments. Only the current day's variation margin is reported in
receivables or payables in the Statement of Assets and Liabilities.
EFFECT OF DERIVATIVE INSTRUMENTS IN THE STATEMENT OF OPERATIONS
FOR THE YEAR ENDED JULY 31, 2010
<Table>
<Caption>
AMOUNT OF REALIZED GAIN (LOSS) ON DERIVATIVES RECOGNIZED IN INCOME
- --------------------------------------------------------------------------------
FORWARD FOREIGN
RISK EXPOSURE CATEGORY CURRENCY CONTRACTS FUTURES TOTAL
- --------------------------------------------------------------------------------
Equity contracts $ -- $7,465,395 $7,465,395
- --------------------------------------------------------------------------------
Foreign exchange contracts (1,114) -- $ (1,114)
- --------------------------------------------------------------------------------
Total $(1,114) $7,465,395 $7,464,281
- --------------------------------------------------------------------------------
</Table>
<Table>
<Caption>
CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON DERIVATIVES RECOGNIZED IN
INCOME
- -------------------------------------------------------------------------------
FORWARD FOREIGN
RISK EXPOSURE CATEGORY CURRENCY CONTRACTS FUTURES TOTAL
- -------------------------------------------------------------------------------
Equity contracts $-- $(133,750) $(133,750)
- -------------------------------------------------------------------------------
Foreign exchange contracts -- -- $ --
- -------------------------------------------------------------------------------
Total $-- $(133,750) $(133,750)
- -------------------------------------------------------------------------------
</Table>
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 51
NOTES TO FINANCIAL STATEMENTS (continued) --------------------------------------
VOLUME OF DERIVATIVE ACTIVITY
FORWARD FOREIGN CURRENCY CONTRACTS
At July 31, 2010, the Fund had no outstanding forward foreign currency
contracts. The average gross notional amount of forward foreign currency
contracts opened, and subsequently closed, was $73,000 for the year ended July
31, 2010.
FUTURES
The gross notional amount of long contracts outstanding was approximately $47
million at July 31, 2010. The monthly average gross notional amount for these
contracts was $28.5 million for the year ended July 31, 2010. The fair value of
such contracts at July 31, 2010 is set forth in the table above.
4. EXPENSES AND SALES CHARGES
INVESTMENT MANAGEMENT SERVICES FEES
Under an Investment Management Services Agreement, the Investment Manager
determines which securities will be purchased, held or sold. The management fee
is an annual fee that is equal to a percentage of the Fund's average daily net
assets that declines from 0.60% to 0.375% as the Fund's net assets increase. The
fee may be adjusted upward or downward by a performance incentive adjustment
determined monthly by measuring the percentage difference over a rolling 12-
month period between the annualized performance of one Class A share of the Fund
and the annualized performance of the Lipper Large-Cap Core Funds Index. In
certain circumstances, the Board may approve a change in the index. The maximum
adjustment is 0.12% per year. If the performance difference is less than 0.50%,
the adjustment will be zero. The adjustment decreased the management fee by
$789,031 for the year ended July 31, 2010. The management fee for the year ended
July 31, 2010 was 0.54% of the Fund's average daily net assets, including the
adjustment under the terms of the performance incentive arrangement.
ADMINISTRATIVE SERVICES FEES
Under an Administrative Services Agreement, the Fund pays Ameriprise Financial
an annual fee for administration and accounting services equal to a percentage
of the Fund's average daily net assets that declines from 0.06% to 0.03% as the
Fund's net assets increase. The fee for the year ended July 31, 2010 was 0.05%
of the Fund's average daily net assets.
OTHER FEES
Other expenses are for, among other things, certain expenses of the Fund or the
Board including: Fund boardroom and office expense, employee compensation,
employee health and retirement benefits, and certain other expenses. Payment of
these Fund and Board expenses is facilitated by a company providing limited
- --------------------------------------------------------------------------------
52 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
administrative services to the Fund and the Board. For the year ended July 31,
2010, there were no expenses incurred for these particular items.
COMPENSATION OF BOARD MEMBERS
Under a Deferred Compensation Plan (the Plan), the board members who are not
"interested persons" of the Fund under the 1940 Act may defer receipt of their
compensation. Deferred amounts are treated as though equivalent dollar amounts
had been invested in shares of the Fund or certain other funds managed by the
Investment Manager. The Fund's liability for these amounts is adjusted for
market value changes and remains in the funds until distributed in accordance
with the Plan.
TRANSFER AGENCY FEES
Under a Transfer Agency Agreement, Columbia Management Investment Services Corp.
(formerly known as RiverSource Service Corporation) (the Transfer Agent)
maintains Fund shareholder accounts and records and provides Fund shareholder
services. The Fund paid the Transfer Agent an annual account-based fee at a rate
equal to $19.50 for Class A, $20.50 for Class B and $20.00 for Class C for this
service. The Transfer Agent also charged an annual fee of $3 per account
serviced directly by the Fund or its designated agent for Class A, Class B and
Class C shares. The Fund also paid the Transfer Agent an annual asset-based fee
at a rate of 0.05% of the Fund's average daily net assets attributable to Class
R2, Class R3, Class R4 and Class R5 shares and an annual asset-based fee at a
rate of 0.20% of the Fund's average daily net assets attributable to Class W
shares. The Transfer Agent charged an annual fee of $5 per inactive account,
charged on a pro rata basis for the 12 month period from the date the account
becomes inactive. The Transfer Agent also received reimbursement for certain
out-of-pocket expenses. These fees are included in the transfer agency fees in
the Statement of Operations.
The Fund and certain other associated investment companies (together, the
Guarantors), have severally, but not jointly, guaranteed the performance and
observance of all the terms and conditions of a lease entered into by Seligman
Data Corp. (SDC), the former transfer agent of Seligman Common Stock Fund, which
was acquired by the Fund on Sept. 11, 2009 (Note 10), including the payment of
rent by SDC (the Guaranty). The lease and the Guaranty expire in January 2019.
At July 31, 2010, the Fund's total potential future obligation over the life of
the Guaranty is $132,673. The liability remaining at July 31, 2010 for Non-
Recurring Charges amounted to $66,723 and is included within other accrued
expenses in the Statement of Assets and Liabilities. SDC is owned by six
associated investment companies, including the Fund. The Fund's ownership
interest in SDC at July 31, 2010 is included in other assets in the Statement of
Assets and Liabilities at cost of $22,506.
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 53
NOTES TO FINANCIAL STATEMENTS (continued) --------------------------------------
PLAN ADMINISTRATION SERVICES FEES
Under a Plan Administration Services Agreement with the Transfer Agent, the Fund
paid an annual fee at a rate of 0.25% of the Fund's average daily net assets
attributable to Class R2, Class R3 and Class R4 shares for the provision of
various administrative, recordkeeping, communication and educational services.
DISTRIBUTION FEES
The Fund has an agreement with Columbia Management Investment Distributors, Inc.
(formerly known as RiverSource Fund Distributors, Inc.) (the Distributor) for
distribution and shareholder services. Under a Plan and Agreement of
Distribution pursuant to Rule 12b-1, the Fund paid a fee at an annual rate of up
to 0.25% of the Fund's average daily net assets attributable to Class A, Class
R3 and Class W shares, a fee at an annual rate of up to 0.50% of the Fund's
average daily net assets attributable to Class R2 shares and a fee at an annual
rate of up to 1.00% of the Fund's average daily net assets attributable to Class
B and Class C shares. For Class B and Class C shares, of the 1.00% fee, up to
0.75% is reimbursed for distribution expenses.
The amount of distribution expenses incurred by the Distributor and not yet
reimbursed (unreimbursed expense) was approximately $10,727,000 and $1,330,000
for Class B and Class C shares, respectively. These amounts are based on the
most recent information available as of April 30, 2010, and may be recovered
from future payments under the distribution plan or CDSC. To the extent the
unreimbursed expense has been fully recovered, the distribution fee is reduced.
SALES CHARGES
Sales charges, including front-end and CDSCs, received by the Distributor for
distributing Fund shares were $1,419,064 for Class A, $189,865 for Class B and
$1,619 for Class C for the year ended July 31, 2010.
EXPENSES WAIVED/REIMBURSED BY THE INVESTMENT MANAGER AND ITS AFFILIATES
For the year ended July 31, 2010, the Investment Manager and its affiliates
waived/reimbursed certain fees and expenses such that net expenses (excluding
- --------------------------------------------------------------------------------
54 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
fees and expenses of acquired funds*), including the adjustment under the terms
of a performance incentive arrangement, were as follows:
<Table>
Class A.............................................. 1.00%
Class B.............................................. 1.78
Class C.............................................. 1.77
Class I.............................................. 0.54
Class R2............................................. 1.36
Class R3............................................. 1.10
Class R4............................................. 0.85
Class R5............................................. 0.61
Class W.............................................. 0.98
</Table>
The waived/reimbursed fees and expenses for the transfer agency fees at the
class level were as follows:
<Table>
Class A.......................................... $2,272,002
Class B.......................................... 171,594
Class C.......................................... 19,994
Class R2......................................... 78
Class R4......................................... 5,975
Class R5......................................... 909
Class W.......................................... 16,258
</Table>
The management fees waived/reimbursed at the Fund level were $2,405,684.
Under an agreement which is effective until Sept. 30, 2010, the Investment
Manager and its affiliates have contractually agreed to waive certain fees and
reimburse certain expenses such that net expenses (excluding fees and expenses
of acquired funds*), before giving effect to any performance incentive
adjustment, will not exceed the following percentage of the class' average daily
net assets:
<Table>
Class A.............................................. 1.02%
Class B.............................................. 1.80
Class C.............................................. 1.78
Class I.............................................. 0.57
Class R2............................................. 1.37
Class R3............................................. 1.12
Class R4............................................. 0.87
Class R5............................................. 0.62
Class W.............................................. 1.02
</Table>
Effective Oct. 1, 2010, the Investment Manager and its affiliates have
contractually agreed to waive certain fees and reimburse certain expenses until
Sept. 30, 2011, unless sooner terminated at the sole discretion of the Board,
such that net expenses (excluding fees and expenses of acquired funds*), before
giving
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 55
NOTES TO FINANCIAL STATEMENTS (continued) --------------------------------------
effect to any performance incentive adjustment, will not exceed the following
percentage of the class' average daily net assets:
<Table>
Class A.............................................. 1.07%
Class B.............................................. 1.82
Class C.............................................. 1.82
Class I.............................................. 0.64
Class R.............................................. 1.32
Class R4............................................. 0.94
Class R5............................................. 0.69
Class W.............................................. 1.07
</Table>
* In addition to the fees and expenses which the Fund bears directly, the Fund
indirectly bears a pro rata share of the fees and expenses of the funds in
which it invests (also referred to as "acquired funds"), including
affiliated and non-affiliated pooled investment vehicles (including mutual
funds and exchange traded funds). Because the acquired funds have varied
expense and fee levels and the Fund may own different proportions of
acquired funds at different times, the amount of fees and expenses incurred
indirectly by the Fund will vary.
5. SECURITIES TRANSACTIONS
Cost of purchases (other than short-term obligations) aggregated $5,145,686,771
for the year ended July 31, 2010, including $2,341,695,402* from RiverSource
Large Cap Equity Fund and Seligman Common Stock Fund that were acquired in the
fund mergers as described in Note 10 and $25,611,418* of purchases done to
realign the Fund's portfolio following the mergers. Proceeds from the sales of
securities (other than short-term obligations) aggregated $3,818,605,403 for the
year ended July 31, 2010, including $25,611,418* of sales to realign the Fund's
portfolio following the mergers. Realized gains and losses are determined on an
identified cost basis.
* Amounts are excluded for purposes of calculating the Fund's portfolio
turnover rate.
6. CAPITAL SHARE TRANSACTIONS
Transactions in shares of capital stock for the periods indicated were as
follows:
<Table>
<Caption>
YEAR ENDED JULY 31, 2010 2009
- -------------------------------------------------------------------
CLASS A
Sold 10,784,504 6,821,872
Fund mergers 481,393,025 N/A
Converted from Class B* 10,543,095 1,149,578
Reinvested distributions 9,418,377 7,831,648
Redeemed (105,593,553) (36,445,132)
- -------------------------------------------------------------------
Net increase (decrease) 406,545,448 (20,642,034)
- -------------------------------------------------------------------
</Table>
- --------------------------------------------------------------------------------
56 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
<Table>
<Caption>
YEAR ENDED JULY 31, 2010 2009
- -------------------------------------------------------------------
CLASS B
Sold 2,259,472 499,210
Fund mergers 46,018,619 N/A
Reinvested distributions 439,252 200,930
Converted to Class A* (10,610,109) (1,160,372)
Redeemed (9,206,091) (1,988,665)
- -------------------------------------------------------------------
Net increase (decrease) 28,901,143 (2,448,897)
- -------------------------------------------------------------------
CLASS C
Sold 578,648 128,711
Fund mergers 4,760,196 N/A
Reinvested distributions 46,332 18,704
Redeemed (1,167,803) (132,782)
- -------------------------------------------------------------------
Net increase (decrease) 4,217,373 14,633
- -------------------------------------------------------------------
CLASS I
Sold 10,321,219 23,916,807
Fund mergers 8,392,835 N/A
Reinvested distributions 2,889,508 3,905,496
Redeemed (32,395,788) (17,233,065)
- -------------------------------------------------------------------
Net increase (decrease) (10,792,226) 10,589,238
- -------------------------------------------------------------------
CLASS R2
Sold 169,630 --
Fund mergers 420,791 N/A
Reinvested distributions 662 --
Redeemed (128,468) --
- -------------------------------------------------------------------
Net increase (decrease) 462,615 --
- -------------------------------------------------------------------
CLASS R3
Fund mergers 612 N/A
- -------------------------------------------------------------------
Net increase (decrease) 612 N/A
- -------------------------------------------------------------------
CLASS R4
Sold 4,153,046 2,764,051
Fund mergers 15,915,653 N/A
Reinvested distributions 877,433 1,083,396
Redeemed (7,531,805) (4,474,270)
- -------------------------------------------------------------------
Net increase (decrease) 13,414,327 (626,823)
- -------------------------------------------------------------------
CLASS R5
Sold 663,718 --
Fund mergers 5,440,327 N/A
Reinvested distributions 59,413 --
Redeemed (934,137) --
- -------------------------------------------------------------------
Net increase (decrease) 5,229,321 --
- -------------------------------------------------------------------
</Table>
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 57
NOTES TO FINANCIAL STATEMENTS (continued) --------------------------------------
<Table>
<Caption>
YEAR ENDED JULY 31, 2010 2009
- -------------------------------------------------------------------
CLASS W
Sold 17,173,271 79,709,796
Reinvested distributions 4,787,849 10,352,737
Redeemed (112,043,210) (152,063,288)
- -------------------------------------------------------------------
Net increase (decrease) (90,082,090) (62,000,755)
- -------------------------------------------------------------------
</Table>
* Automatic conversion of Class B shares to Class A shares based on the
original purchase date.
7. LENDING OF PORTFOLIO SECURITIES
The Fund has entered into a Master Securities Lending Agreement (the Agreement)
with JPMorgan Chase Bank, National Association (JPMorgan). The Agreement
authorizes JPMorgan as lending agent to lend securities to authorized borrowers
in order to generate additional income on behalf of the Fund. Pursuant to the
Agreement, the securities loaned are secured by cash or U.S. government
securities equal to at least 100% of the market value of the loaned securities.
Any additional collateral required to maintain those levels due to market
fluctuations of the loaned securities is delivered the following business day.
Cash collateral received is invested by the lending agent on behalf of the Fund
into authorized investments pursuant to the Agreement. The investments made with
the cash collateral are listed in the Portfolio of Investments. The values of
such investments and any uninvested cash collateral are disclosed in the
Statement of Assets and Liabilities along with the related obligation to return
the collateral upon the return of the securities loaned. At July 31, 2010,
securities valued at $656,224,229 were on loan, secured by cash collateral of
$671,510,186 invested in short-term securities or in cash equivalents.
Risks of delay in recovery of securities or even loss of rights in the
securities may occur should the borrower of the securities fail financially.
Risks may also arise to the extent that the value of the securities loaned
increases above the value of the collateral received. JPMorgan will indemnify
the Fund from losses resulting from a borrower's failure to return a loaned
security when due. Such indemnification does not extend to losses associated
with declines in the value of cash collateral investments. Loans are subject to
termination by the Fund or the borrower at any time, and are, therefore, not
considered to be illiquid investments.
Pursuant to the Agreement, the Fund receives income for lending its securities
either in the form of fees or by earning interest on invested cash collateral,
net of negotiated rebates paid to borrowers and fees paid to the lending agent
for services provided and any other securities lending expenses. Net income of
$2,078,072 earned from securities lending for the year ended July 31, 2010 is
- --------------------------------------------------------------------------------
58 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
included in the Statement of Operations. The Fund also continues to earn
interest and dividends on the securities loaned.
8. AFFILIATED MONEY MARKET FUND
The Fund may invest its daily cash balance in Columbia Short-Term Cash Fund
(formerly known as RiverSource Short-Term Cash Fund), a money market fund
established for the exclusive use of certain funds managed by the Investment
Manager and other institutional clients of the Investment Manager. The cost of
the Fund's purchases and proceeds from sales of shares of Columbia Short-Term
Cash Fund aggregated $818,135,862 and $790,951,973, respectively, for the year
ended July 31, 2010. The income distributions received with respect to the
Fund's investment in Columbia Short-Term Cash Fund can be found in the Statement
of Operations and the Fund's invested balance in Columbia Short-Term Cash Fund
at July 31, 2010, can be found in the Portfolio of Investments.
9. BANK BORROWINGS
The Fund has entered into a revolving credit facility with a syndicate of banks
led by JPMorgan Chase Bank, N.A. (the Administrative Agent), whereby the Fund
may borrow for the temporary funding of shareholder redemptions or for other
temporary or emergency purposes. The credit facility became effective on Oct.
15, 2009, replacing a prior credit facility. The credit facility agreement,
which is a collective agreement between the Fund and certain other funds managed
by the Investment Manager, severally and not jointly, permits collective
borrowings up to $300 million. The borrowers shall have the right, upon written
notice to the Administrative Agent to request an increase of up to $200 million
in the aggregate amount of the credit facility from new or existing lenders,
provided that the aggregate amount of the credit facility shall at no time
exceed $500 million. Participation in such increase by any existing lender shall
be at such lender's sole discretion. Interest is charged to each Fund based on
its borrowings at a rate equal to the sum of the federal funds rate plus (i)
1.25% per annum plus (ii) if one-month LIBOR exceeds the federal funds rate, the
amount of such excess. Each borrowing under the credit facility matures no later
than 60 days after the date of borrowing. The Fund also pays a commitment fee
equal to its pro rata share of the amount of the credit facility at a rate of
0.10% per annum, in addition to an upfront fee equal to its pro rata share of
0.04% of the amount of the credit facility. Prior to Oct. 15, 2009, the credit
facility agreement, which was a collective agreement between the Fund and
certain other funds managed by the Investment Manager, severally and not
jointly, permitted collective borrowings up to $475 million. Interest was
charged to each Fund based on its borrowings at a rate equal to the federal
funds rate plus 0.75%. The Fund also paid a commitment fee equal to its pro rata
share of the amount of the
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 59
NOTES TO FINANCIAL STATEMENTS (continued) --------------------------------------
credit facility at a rate of 0.06% per annum, in addition to an upfront fee
equal to its pro rata share of 0.02% of the amount of the credit facility. The
Fund had no borrowings during the year ended July 31, 2010.
10. FUND MERGERS
At the close of business on Sept. 11, 2009, Columbia Large Core Quantitative
Fund acquired the assets and assumed the identified liabilities of RiverSource
Large Cap Equity Fund and Seligman Common Stock Fund. The reorganizations were
completed after shareholders approved the plans on June 2, 2009.
The aggregate net assets of Columbia Large Core Quantitative Fund immediately
before the acquisitions were $1,879,250,294 and the combined net assets
immediately after the acquisitions were $4,385,060,209.
The mergers were accomplished by tax-free exchanges of 729,934,986 shares of
RiverSource Large Cap Equity Fund valued at $2,406,154,730 and 14,681,342 shares
of Seligman Common Stock Fund valued at $99,655,185.
In exchange for RiverSource Large Cap Equity Fund shares and net assets,
Columbia Large Core Quantitative Fund issued the following number of shares:
<Table>
<Caption>
SHARES
- --------------------------------------------------------------
Class A.......................................... 461,367,825
Class B.......................................... 45,802,954
Class C.......................................... 3,041,958
Class I.......................................... 8,392,835
Class R2......................................... 613
Class R3......................................... 612
Class R4......................................... 15,915,653
Class R5......................................... 5,436,673
</Table>
In exchange for Seligman Common Stock Fund shares and net assets, Columbia Large
Core Quantitative Fund issued the following number of shares:
<Table>
<Caption>
SHARES
- -------------------------------------------------------------
Class A.......................................... 20,025,200
Class B.......................................... 215,665
Class C.......................................... 1,718,238
Class R2......................................... 420,178
Class R5......................................... 3,654
</Table>
For financial reporting purposes, net assets received and shares issued by
Columbia Large Core Quantitative Fund were recorded at fair value; however, cost
of investments for RiverSource Large Cap Equity Fund and Seligman Common Stock
Fund were carried forward to align ongoing reporting of
- --------------------------------------------------------------------------------
60 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
Columbia Large Core Quantitative Fund's realized and unrealized gains and losses
with amounts distributable to shareholders for tax purposes.
The components of net assets after adjustments for any permanent book-to-tax
differences at the merger date for RiverSource Large Cap Equity Fund and
Seligman Common Stock Fund were as follows:
<Table>
<Caption>
RIVERSOURCE LARGE SELIGMAN COMMON
CAP EQUITY FUND STOCK FUND
- ------------------------------------------------------------------------
Total net assets $ 2,406,154,730 $ 99,655,185
Capital stock $ 4,210,331,804 $191,584,231
Undistributed (excess of
distributions over) net investment
income $ (735,495) $ 1,404
Accumulated net realized loss $(1,949,209,843) $(88,859,870)
Unrealized appreciation
(depreciation) $ 145,768,264 $ (3,070,580)
</Table>
The financial statements reflect the operations of Columbia Large Core
Quantitative Fund for the period prior to the mergers and the combined fund for
the period subsequent to the mergers. Because the combined investment portfolios
have been managed as a single integrated portfolio since the mergers were
completed, it is not practicable to separate the amounts of revenue and earnings
of RiverSource Large Cap Equity Fund and Seligman Common Stock Fund that have
been included in the combined Fund's Statement of Operations since the mergers
were completed. Assuming the mergers had been completed on Aug. 1, 2009,
Columbia Large Core Quantitative Fund's pro-forma net investment income, net
loss on investments, and net increase in net assets from operations for the year
ended July 31, 2010 would have been $26.1 million, $(108.1) million and $586.7
million, respectively.
11. LEHMAN BROTHERS HOLDINGS INC. EQUITY-LINKED NOTES
The Fund holds investments in two equity-linked notes (notes) for which Lehman
Brothers Holdings Inc. (Lehman Brothers) is the counterparty. The notes (with an
aggregate principal amount of $2.6 million) defaulted as of their respective
maturity dates, Sept. 14, 2008 and Oct. 2, 2008. Lehman Brothers filed a Chapter
11 bankruptcy petition on Sept. 15, 2008, and as such, it is likely that the
Fund will receive less than the maturity value of the notes, pending the outcome
of the bankruptcy proceedings. Based on the bankruptcy proceedings, the Fund
recorded receivables aggregating $246,717 based on the estimated amounts
recoverable for the notes and recognized realized losses of $2.3 million. The
estimates of the amounts recoverable for the notes are periodically adjusted by
the Investment Manager based on the observable trading price of Lehman Brothers
senior notes, which provide an indication of amounts recoverable through the
bankruptcy proceedings. Any changes to the receivable balances resulting from
such adjustments are recorded as a component of interest income
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 61
NOTES TO FINANCIAL STATEMENTS (continued) --------------------------------------
in the Statement of Operations. At July 31, 2010, the value of the receivable
balances were $390,262, which represented 0.01% of the Fund's net assets. The
receivable balances for the notes are reported as other receivables in the
Statement of Assets and Liabilities
12. FEDERAL TAX INFORMATION
Net investment income (loss) and net realized gains (losses) may differ for
financial statement and tax purposes primarily because of futures contracts,
foreign currency transactions, re-characterization of real estate investment
trust (REIT) distributions, investments in partnerships, post-October losses and
losses deferred due to wash sales. The character of distributions made during
the year from net investment income or net realized gains may differ from their
ultimate characterization for federal income tax purposes. Also, due to the
timing of dividend distributions, the fiscal year in which amounts are
distributed may differ from the year that the income or realized gains were
recorded by the Fund.
In the Statement of Assets and Liabilities, as a result of permanent book-to-tax
differences, excess of distributions over net investment income has been
increased by $103,110 and accumulated net realized loss has been decreased by
$207,141,702 resulting in a net reclassification adjustment to decrease paid-in
capital by $207,038,592.
The tax character of distributions paid for the years indicated was as follows:
<Table>
<Caption>
YEAR ENDED JULY 31, 2010 2009
- ------------------------------------------------------------------
Ordinary income $87,580,581 $26,288,073
Long-term capital gain -- 69,119,748
</Table>
At July 31, 2010, the components of distributable earnings on a tax basis were
as follows:
<Table>
Undistributed ordinary income................ $ 441,871
Undistributed accumulated long-term gain..... $ --
Accumulated realized loss.................... $(2,641,007,182)
Unrealized appreciation (depreciation)....... $ 83,181,065
</Table>
For federal income tax purposes, the Fund had a capital loss carry-over of
$2,425,729,564 at July 31, 2010, that if not offset by capital gains will expire
as follows:
<Table>
<Caption>
2016 2017 2018
$420,044,596 $1,377,208,066 $628,476,902
</Table>
Columbia Large Core Quantitative Fund acquired $1,797,049,041 of capital loss
carry-overs in connection with the RiverSource Large Cap Equity Fund and
Seligman Common Stock Fund mergers (Note 10). The yearly utilization of the
- --------------------------------------------------------------------------------
62 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
acquired capital losses as well as the utilization of the acquired unrealized
losses is limited by the Internal Revenue Code. For the year ended July 31,
2010, $125,339,009 of capital loss carry-over was utilized and/or expired
unused. It is unlikely the Board will authorize a distribution of any net
realized capital gains until the available capital loss carry-over has been
offset or expires. There is no assurance that the Fund will be able to utilize
all of its capital loss carry-over before it expires.
Because the measurement periods for a regulated investment company's income are
different for excise tax purposes versus income tax purposes, special rules are
in place to protect the amount of earnings and profits needed to support excise
tax distributions. As a result, the Fund is permitted to treat net capital
losses realized between Nov. 1, 2009 and its fiscal year end (post-October loss)
as occurring on the first day of the following tax year. At July 31, 2010, the
Fund had a post-October loss of $215,277,618 that is treated for income tax
purposes as occurring on Aug. 1, 2010.
13. SUBSEQUENT EVENTS
Management has evaluated Fund related events and transactions that occurred
during the period from the date of the Statement of Assets and Liabilities
through the date of issuance of the Fund's financial statements. There were no
events or transactions that occurred during the period that materially impacted
the amounts or disclosures in the Fund's financial statements.
14. INFORMATION REGARDING PENDING AND SETTLED LEGAL PROCEEDINGS
In June 2004, an action captioned John E. Gallus et al. v. American Express
Financial Corp. and American Express Financial Advisors Inc. was filed in the
United States District Court for the District of Arizona. The plaintiffs allege
that they are investors in several American Express Company (now known as legacy
RiverSource) mutual funds and they purport to bring the action derivatively on
behalf of those funds under the Investment Company Act of 1940. The plaintiffs
allege that fees allegedly paid to the defendants by the funds for investment
advisory and administrative services are excessive. The plaintiffs seek remedies
including restitution and rescission of investment advisory and distribution
agreements. The plaintiffs voluntarily agreed to transfer this case to the
United States District Court for the District of Minnesota (the District Court).
In response to defendants' motion to dismiss the complaint, the District Court
dismissed one of plaintiffs' four claims and granted plaintiffs limited
discovery. Defendants moved for summary judgment in April 2007. Summary judgment
was granted in the defendants' favor on July 9, 2007. The plaintiffs filed a
notice of
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 63
NOTES TO FINANCIAL STATEMENTS (continued) --------------------------------------
appeal with the Eighth Circuit Court of Appeals (the Eighth Circuit) on August
8, 2007. On April 8, 2009, the Eighth Circuit reversed summary judgment and
remanded to the District Court for further proceedings. On August 6, 2009,
defendants filed a writ of certiorari with the U.S. Supreme Court (the Supreme
Court), asking the Supreme Court to stay the District Court proceedings while
the Supreme Court considers and rules in a case captioned Jones v. Harris
Associates, which involves issues of law similar to those presented in the
Gallus case. On March 30, 2010, the Supreme Court issued its ruling in Jones v.
Harris Associates, and on April 5, 2010, the Supreme Court vacated the Eighth
Circuit's decision in the Gallus case and remanded the case to the Eighth
Circuit for further consideration in light of the Supreme Court's decision in
Jones v. Harris Associates. On June 4, 2010, the Eighth Circuit remanded the
Gallus case to the District Court for further consideration in light of the
Supreme Court's decision in Jones v. Harris Associates.
In December 2005, without admitting or denying the allegations, American Express
Financial Corporation (AEFC, which is now known as Ameriprise Financial, Inc.
(Ameriprise Financial)), entered into settlement agreements with the Securities
and Exchange Commission (SEC) and Minnesota Department of Commerce (MDOC)
related to market timing activities. As a result, AEFC was censured and ordered
to cease and desist from committing or causing any violations of certain
provisions of the Investment Advisers Act of 1940, the Investment Company Act of
1940, and various Minnesota laws. AEFC agreed to pay disgorgement of $10 million
and civil money penalties of $7 million. AEFC also agreed to retain an
independent distribution consultant to assist in developing a plan for
distribution of all disgorgement and civil penalties ordered by the SEC in
accordance with various undertakings detailed at
http://www.sec.gov/litigation/admin/ia-2451.pdf. Ameriprise Financial and its
affiliates have cooperated with the SEC and the MDOC in these legal proceedings,
and have made regular reports to the funds' Boards of Directors/Trustees.
Ameriprise Financial and certain of its affiliates have historically been
involved in a number of legal, arbitration and regulatory proceedings, including
routine litigation, class actions, and governmental actions, concerning matters
arising in connection with the conduct of their business activities. Ameriprise
Financial believes that the Funds are not currently the subject of, and that
neither Ameriprise Financial nor any of its affiliates are the subject of, any
pending legal, arbitration or regulatory proceedings that are likely to have a
material adverse effect on the Funds or the ability of Ameriprise Financial or
its affiliates to perform under their contracts with the Funds. Ameriprise
Financial is required to make 10-Q, 10-K and, as necessary, 8-K filings with the
Securities and Exchange Commission on legal and regulatory matters that relate
to Ameriprise
- --------------------------------------------------------------------------------
64 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
Financial and its affiliates. Copies of these filings may be obtained by
accessing the SEC website at www.sec.gov.
There can be no assurance that these matters, or the adverse publicity
associated with them, will not result in increased fund redemptions, reduced
sale of fund shares or other adverse consequences to the Funds. Further,
although we believe proceedings are not likely to have a material adverse effect
on the Funds or the ability of Ameriprise Financial or its affiliates to perform
under their contracts with the Funds, these proceedings are subject to
uncertainties and, as such, we are unable to estimate the possible loss or range
of loss that may result. An adverse outcome in one or more of these proceedings
could result in adverse judgments, settlements, fines, penalties or other relief
that could have a material adverse effect on the consolidated financial
condition or results of operations of Ameriprise Financial.
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 65
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM ------------------------
TO THE BOARD OF DIRECTORS AND SHAREHOLDERS OF
COLUMBIA LARGE CORE QUANTITATIVE FUND:
We have audited the accompanying statement of assets and liabilities, including
the portfolio of investments, of Columbia Large Core Quantitative Fund (formerly
RiverSource Disciplined Equity Fund) (the Fund) of the RiverSource Large Cap
Series, Inc., as of July 31, 2010, and the related statement of operations for
the year then ended, the statements of changes in net assets for each of the two
years in the period then ended, and the financial highlights for each of the
four years in the period then ended. These financial statements and financial
highlights are the responsibility of the Fund's management. Our responsibility
is to express an opinion on these financial statements and financial highlights
based on our audits. The financial highlights of the Fund for the period ended
July 31, 2006, were audited by other auditors whose report dated September 20,
2006, expressed an unqualified opinion on those financial highlights.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. We were
not engaged to perform an audit of the Fund's internal control over financial
reporting. Our audits included consideration of internal control over financial
reporting as a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Fund's internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements and financial highlights, assessing the accounting principles used
and significant estimates made by management, and evaluating the overall
financial statement presentation. Our procedures included confirmation of
securities owned as of July 31, 2010, by correspondence with the custodian and
brokers, or by other appropriate auditing procedures where replies from brokers
were not received. We believe that our audits provide a reasonable basis for our
opinion.
- --------------------------------------------------------------------------------
66 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
In our opinion, the financial statements and financial highlights audited by us
as referred to above present fairly, in all material respects, the financial
position of Columbia Large Core Quantitative Fund of the RiverSource Large Cap
Series, Inc. at July 31, 2010, the results of its operations for the year then
ended, the changes in its net assets for each of the two years in the period
then ended, and the financial highlights for each of the four years in the
period then ended, in conformity with U.S. generally accepted accounting
principles.
/s/ Ernst & Young LLP
Minneapolis, Minnesota
September 20, 2010
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 67
FEDERAL INCOME TAX INFORMATION -------------------------------------------------
(UNAUDITED)
The Fund is required by the Internal Revenue Code of 1986 to tell its
shareholders about the tax treatment of the dividends it pays during its fiscal
year. The dividends listed below are reported to you on Form 1099-DIV, Dividends
and Distributions. Shareholders should consult a tax advisor on how to report
distributions for state and local tax purposes.
Fiscal year ended July 31, 2010
<Table>
<Caption>
INCOME DISTRIBUTIONS - the Fund designates the following tax attributes for
distributions:
Qualified Dividend Income for individuals........................ 100.00%
Dividends Received Deduction for corporations.................... 100.00%
U.S. Government Obligations...................................... 0.00%
</Table>
The Fund designates as distributions of long-term gains, to the extent necessary
to fully distribute such capital gains, earnings and profits distributed to
shareholders on the redemption of shares.
- --------------------------------------------------------------------------------
68 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
BOARD MEMBERS AND OFFICERS -----------------------------------------------------
Shareholders elect a Board that oversees the Fund's operations. The Board
appoints officers who are responsible for day-to-day business decisions based on
policies set by the Board. The following is a list of the Fund's Board members.
Each Board member oversees 150 Columbia, RiverSource, Seligman and Threadneedle
funds. Under current Board policy, members generally serve until the next
regular shareholders' meeting, until he or she reaches the mandatory retirement
age established by the Board, or the fifteenth anniversary of the first Board
meeting they attended as members of the Board.
INDEPENDENT BOARD MEMBERS*
<Table>
<Caption>
OTHER PRESENT OR
NAME, POSITION HELD PAST DIRECTORSHIPS
ADDRESS, WITH FUND AND PRINCIPAL OCCUPATION (WITHIN PAST 5
AGE LENGTH OF SERVICE DURING PAST FIVE YEARS YEARS)
- ------------------------------------------------------------------------------------------------------------------------------
Kathleen Blatz Board member since Chief Justice, Minnesota Supreme Court, 1998-2006; None
901 S. Marquette Ave. 1/11/06 Attorney
Minneapolis, MN 55402
Age 56
- ------------------------------------------------------------------------------------------------------------------------------
Arne H. Carlson Board member since Chair, RiverSource and Threadneedle Funds, 1999-2006; None
901 S. Marquette Ave. 1/5/99 former Governor of Minnesota
Minneapolis, MN 55402
Age 76
- ------------------------------------------------------------------------------------------------------------------------------
Pamela G. Carlton Board member since President, Springboard -- Partners in Cross Cultural None
901 S. Marquette Ave. 7/11/07 Leadership (consulting company)
Minneapolis, MN 55402
Age 55
- ------------------------------------------------------------------------------------------------------------------------------
Patricia M. Flynn Board member since Trustee Professor of Economics and Management, Bentley None
901 S. Marquette Ave. 11/1/04 University; former Dean, McCallum Graduate School of
Minneapolis, MN 55402 Business, Bentley University
Age 59
- ------------------------------------------------------------------------------------------------------------------------------
Anne P. Jones Board member since Attorney and Consultant None
901 S. Marquette Ave. 3/1/85
Minneapolis, MN 55402
Age 75
- ------------------------------------------------------------------------------------------------------------------------------
Jeffrey Laikind, CFA Board member since Former Managing Director, Shikiar Asset Management American Progressive
901 S. Marquette Ave. 11/1/05 Insurance; Hapoalim
Minneapolis, MN 55402 Securities USA, Inc.
Age 74
- ------------------------------------------------------------------------------------------------------------------------------
Stephen R. Lewis, Jr. Chair of the Board President Emeritus and Professor of Economics, Carleton Valmont Industries,
901 S. Marquette Ave. since 1/1/07, College Inc. (manufactures
Minneapolis, MN 55402 Board member irrigation systems)
Age 71 since 1/1/02
- ------------------------------------------------------------------------------------------------------------------------------
</Table>
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 69
BOARD MEMBERS AND OFFICERS (continued) -----------------------------------------
INDEPENDENT BOARD MEMBERS (CONTINUED)
<Table>
<Caption>
OTHER PRESENT OR
NAME, POSITION HELD PAST DIRECTORSHIPS
ADDRESS, WITH FUND AND PRINCIPAL OCCUPATION (WITHIN PAST 5
AGE LENGTH OF SERVICE DURING PAST FIVE YEARS YEARS)
- ------------------------------------------------------------------------------------------------------------------------------
John F. Maher Board member Retired President and Chief Executive Officer and None
901 S. Marquette Ave. since 12/10/08 former Director, Great Western Financial Corporation
Minneapolis, MN 55402 (financial services), 1986-1997
Age 67
- ------------------------------------------------------------------------------------------------------------------------------
Catherine James Paglia Board member since Director, Enterprise Asset Management, Inc. (private None
901 S. Marquette Ave. 11/1/04 real estate and asset management company)
Minneapolis, MN 55402
Age 58
- ------------------------------------------------------------------------------------------------------------------------------
Leroy C. Richie Board member Counsel, Lewis & Munday, P.C. since 1987; Vice Digital Ally, Inc.
901 S. Marquette Ave. since 11/11/08 President and General Counsel, Automotive Legal (digital imaging);
Minneapolis, MN 55402 Affairs, Chrysler Corporation, 1990-1997 Infinity, Inc. (oil
Age 69 and gas exploration
and production); OGE
Energy Corp. (energy
and energy services)
- ------------------------------------------------------------------------------------------------------------------------------
Alison Taunton-Rigby Board member since Chief Executive Officer and Director, RiboNovix, Inc. Idera
901 S. Marquette Ave. 11/13/02 since 2003 (biotechnology); former President, Aquila Pharmaceuticals,
Minneapolis, MN 55402 Biopharmaceuticals Inc.
Age 66 (biotechnology);
Healthways, Inc.
(health management
programs)
- ------------------------------------------------------------------------------------------------------------------------------
</Table>
* Mr. Laikind may be deemed, as a technical matter, an interested person of
RiverSource International Managers Series, Inc. and RiverSource Variable
Series Trust because he serves as an independent director of a broker-dealer
that has executed transactions for subadvisers to certain of the funds.
- --------------------------------------------------------------------------------
70 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
BOARD MEMBER AFFILIATED WITH THE INVESTMENT MANAGER*
<Table>
<Caption>
OTHER PRESENT OR
NAME, POSITION HELD PAST DIRECTORSHIPS
ADDRESS, WITH FUND AND PRINCIPAL OCCUPATION (WITHIN PAST 5
AGE LENGTH OF SERVICE DURING PAST FIVE YEARS YEARS)
- ------------------------------------------------------------------------------------------------------------------------------
William F. Truscott Board member Chairman of the Board, Columbia Management Investment None
53600 Ameriprise since 11/7/01, Advisers, LLC (formerly RiverSource Investments, LLC)
Financial Center Vice President since since May 2010 (previously President, Chairman of the
Minneapolis, MN 55474 2002 Board and Chief Investment Officer, 2001-April 2010);
Age 50 Senior Vice President, Atlantic Funds, Columbia Funds
and Nations Funds since May 2010; Chief Executive
Officer, U.S. Asset Management &
President -- Annuities, Ameriprise Financial, Inc.
since May 2010 (previously President -- U.S. Asset
Management and Chief Investment Officer, 2005-April
2010 and Senior Vice President -- Chief Investment
Officer, 2001-2005); Director, President and Chief
Executive Officer, Ameriprise Certificate Company since
2006; Director, Columbia Management Investment
Distributors, Inc. (formerly RiverSource Fund
Distributors, Inc.) since May 2010 (previously Chairman
of the Board and Chief Executive Officer, 2008-April
2010); Chairman of the Board and Chief Executive
Officer, RiverSource Distributors, Inc. since 2006
- ------------------------------------------------------------------------------------------------------------------------------
</Table>
* Interested person (as defined under the 1940 Act) by reason of being an
officer, director, security holder and/or employee of the investment manager
or Ameriprise Financial.
The SAI has additional information about the Fund's Board members and is
available, without charge, upon request by calling 800.345.6611; contacting your
financial intermediary; or visiting columbiamanagement.com.
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 71
BOARD MEMBERS AND OFFICERS (continued) -----------------------------------------
The Board has appointed officers who are responsible for day-to-day business
decisions based on policies it has established. The officers serve at the
pleasure of the Board. In addition to Mr. Truscott, who is Vice President, the
Fund's other officers are:
FUND OFFICERS
<Table>
<Caption>
NAME, POSITION HELD
ADDRESS, WITH FUNDS AND PRINCIPAL OCCUPATION
AGE LENGTH OF SERVICE DURING PAST FIVE YEARS
- --------------------------------------------------------------------------------------------------------
J. Kevin Connaughton President since Senior Vice President and General Manager -- Mutual
One Financial Center 5/1/10 Fund Products, Columbia Management Investment Advisers,
Boston, MA 02111 LLC since May 2010; President, Columbia Funds since
Age 46 2009 (previously Senior Vice President and Chief
Financial Officer, June 2008 -- January 2009);
President, Atlantic Funds and Nations Funds since 2009;
Managing Director of Columbia Management Advisors, LLC,
December 2004 -- April 2010; Treasurer, Columbia Funds,
October 2003 -- May 2008; Treasurer, the Liberty Funds,
Stein Roe Funds and Liberty All-Star Funds, December
2000 -- December 2006; Senior Vice
President -- Columbia Management Advisors, LLC, April
2003 -- December 2004; President, Columbia Funds,
Liberty Funds and Stein Roe Funds, February
2004 -- October 2004
- --------------------------------------------------------------------------------------------------------
Amy K. Johnson Vice President since Senior Vice President and Chief Operating Officer,
5228 Ameriprise Financial 12/5/06 Columbia Management Investment Advisers, LLC (formerly
Center Minneapolis, MN RiverSource Investments, LLC) since May 2010
55474 (previously Chief Administrative Officer, 2009 -- April
Age 45 2010 and Vice President -- Asset Management and Trust
Company Services, 2006-2009 and Vice
President -- Operations and Compliance, 2004-2006);
Senior Vice President, Atlantic Funds, Columbia Funds
and Nations Funds since May 2010; Director of Product
Development -- Mutual Funds, Ameriprise Financial,
Inc., 2001-2004
- --------------------------------------------------------------------------------------------------------
Jeffrey P. Fox Treasurer since Chief Financial Officer, Columbia Management Investment
105 Ameriprise 7/10/02 Distributors, Inc. (formerly RiverSource Fund
Financial Center Distributors, Inc.) and of Seligman Data Corp. since
Minneapolis, MN 55474 2008; Vice President -- Investment Accounting,
Age 55 Ameriprise Financial, Inc. since 2002; Chief Financial
Officer, RiverSource Distributors, Inc. since 2006
- --------------------------------------------------------------------------------------------------------
</Table>
- --------------------------------------------------------------------------------
72 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
FUND OFFICERS (CONTINUED)
<Table>
<Caption>
NAME, POSITION HELD
ADDRESS, WITH FUNDS AND PRINCIPAL OCCUPATION
AGE LENGTH OF SERVICE DURING PAST FIVE YEARS
- --------------------------------------------------------------------------------------------------------
Scott R. Plummer Vice President, Chief Legal Officer and Assistant Secretary, Columbia
5228 Ameriprise Financial General Counsel and Management Investment Advisers, LLC (formerly
Center Secretary since RiverSource Investments, LLC) since June 2005; Vice
Minneapolis, MN 55474 12/5/06 President and Lead Chief Counsel -- Asset Management,
Age 51 Ameriprise Financial, Inc. since May 2010 (previously
Vice President and Chief Counsel -- Asset Management,
2005-April 2010 and Vice President -- Asset Management
Compliance, 2004-2005); Senior Vice President,
Secretary and Chief Legal Officer, Atlantic Funds,
Columbia Funds and Nations Funds since May 2010; Vice
President, Chief Counsel and Assistant Secretary,
Columbia Management Investment Distributors, Inc.
(formerly RiverSource Fund Distributors, Inc.) since
2008; Vice President, General Counsel and Secretary,
Ameriprise Certificate Company since 2005; Chief
Counsel, RiverSource Distributors, Inc. since 2006;
Senior Vice President and Chief Compliance Officer,
USBancorp Asset Management, 2002-2004
- --------------------------------------------------------------------------------------------------------
Michael A. Jones Vice President since Director and President, Columbia Management Investment
100 Federal Street 5/1/10 Advisers, LLC since May 2010; President and Director,
Boston, MA 02110 Columbia Management Investment Distributors, Inc. since
Age 51 May 2010; Senior Vice President, Atlantic Funds,
Columbia Funds and Nations Funds since May 2010;
Manager, Chairman, Chief Executive Officer and
President, Columbia Management Advisors, LLC,
2007 -- April 2010; Chief Executive Officer, President
and Director, Columbia Management Distributors, Inc.,
2006 -- April 2010; former Co-President and Senior
Managing Director, Robeco Investment Management
- --------------------------------------------------------------------------------------------------------
Colin Moore Vice President since Chief Investment Officer, Columbia Management
One Financial Center 5/1/10 Investment Advisers, LLC since May 2010; Senior Vice
Boston, MA 02111 President, Atlantic Funds, Columbia Funds and Nations
Age 52 Funds since May 2010; Manager, Managing Director and
Chief Investment Officer, Columbia Management Advisors,
LLC, 2007- April 2010; Head of Equities, Columbia
Management Advisors, LLC, 2002-Sept. 2007
- --------------------------------------------------------------------------------------------------------
Linda Wondrack Chief Compliance Vice President and Chief Compliance Officer, Columbia
One Financial Center Officer since 5/1/10 Management Investment Advisers, LLC since May 2010;
Boston, MA 02111 Chief Compliance Officer, Columbia Funds since 2007;
Age 46 Senior Vice President and Chief Compliance Officer,
Atlantic Funds and Nations Funds since 2007; Director
(Columbia Management Group, LLC and Investment Product
Group Compliance), Bank of America, June 2005 -- April
2010; Director of Corporate Compliance and Conflicts
Officer, MFS Investment Management (investment
management), August 2004 -- May 2005
- --------------------------------------------------------------------------------------------------------
</Table>
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 73
BOARD MEMBERS AND OFFICERS (continued) -----------------------------------------
FUND OFFICERS (CONTINUED)
<Table>
<Caption>
NAME, POSITION HELD
ADDRESS, WITH FUNDS AND PRINCIPAL OCCUPATION
AGE LENGTH OF SERVICE DURING PAST FIVE YEARS
- --------------------------------------------------------------------------------------------------------
Neysa M. Alecu Money Laundering Vice President -- Compliance, Ameriprise Financial,
2934 Ameriprise Financial Prevention Officer Inc. since 2008; Anti-Money Laundering Officer and
Center since 11/9/05 and Identity Theft Prevention Officer, Columbia Management
Minneapolis, MN 55474 Identity Theft Investment Distributors, Inc. (formerly RiverSource
Age 46 Prevention Officer Fund Distributors, Inc.) since 2008; Anti-Money
since 2008 Laundering Officer, Ameriprise Financial, Inc. since
2005; Compliance Director, Ameriprise Financial, Inc.,
2004-2008
- --------------------------------------------------------------------------------------------------------
</Table>
- --------------------------------------------------------------------------------
74 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
APPROVAL OF INVESTMENT MANAGEMENT SERVICES
AGREEMENT ----------------------------------------------------------------------
Columbia Management Investment Advisers, LLC ("Columbia Management" or the
"investment manager"), formerly known as RiverSource Investments, LLC, a wholly-
owned subsidiary of Ameriprise Financial, Inc. ("Ameriprise Financial"), serves
as the investment manager to the Fund. Under an investment management services
agreement (the "IMS Agreement"), Columbia Management provides investment advice
and other services to the Fund and all funds branded Columbia, RiverSource,
Seligman and Threadneedle.
On an annual basis, the Fund's Board of Directors (the "Board"), including the
independent Board members (the "Independent Directors"), considers renewal of
the IMS Agreement. Columbia Management prepared detailed reports for the Board
and its Contracts Committee in March and April 2010, including reports based on
data provided by independent organizations and a comprehensive response to each
item of information requested by independent legal counsel to the Independent
Directors ("Independent Legal Counsel") in a letter to the investment manager,
to assist the Board in making this determination. All of the materials presented
in March and April 2010 were first supplied in draft form to designated
representatives of the Independent Directors, i.e., Independent Legal Counsel,
the Chair of the Board and the Chair of the Contracts Committee (including
materials relating to the Fund's proposed revised expense cap), and the final
materials were revised to reflect comments provided by these Board
representatives. In addition, throughout the year, the Board (or its committees)
reviews information prepared by Columbia Management addressing the services
Columbia Management provides and Fund performance. The Board accords particular
weight to the work, deliberations and conclusions of the Contracts Committee,
the Investment Review Committee and the Compliance Committee in determining
whether to continue the IMS Agreement. At the April 6-8, 2010 in-person Board
meeting, Independent Legal Counsel reviewed with the Independent Directors,
including in an executive session without management, various factors relevant
to the Board's consideration of advisory agreements and the Board's legal
responsibilities related to such consideration. Following an analysis and
discussion of the factors identified below, the Board, including all of the
Independent Directors, approved renewal of the IMS Agreement.
Nature, Extent and Quality of Services Provided by Columbia Management: The
Board analyzed various reports and presentations it had received detailing the
services performed by Columbia Management, as well as its expertise, resources
and capabilities. The Board specifically considered many developments during the
past year concerning the services provided by Columbia Management, including, in
particular, the continued investment in, and resources dedicated to, the Fund's
operations, most notably, management's announcement of the massive
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 75
APPROVAL OF INVESTMENT MANAGEMENT SERVICES
AGREEMENT (continued) ----------------------------------------------------------
investment made in the acquisition of the long-term asset management business of
Columbia Management Group, LLC (the "Columbia Transaction") and the completed
integration of J. & W. Seligman & Co. Incorporated, acquisitions which should
continue to enhance investment capabilities and provide access to a greater
depth of experienced portfolio managers in key categories. The Board noted, in
particular, that upon the close of the Columbia Transaction, the investment
manager will have grown to 10 investment offices (compared to 6 in 2009). In
addition, the Board reviewed information concerning the investment manager's new
Chief Investment Officer upon the close of the Columbia Transaction, including
the application of his particular investment philosophy, which is intended to
enhance the risk and portfolio management oversight of the entire fund family.
Moreover, in connection with the Board's evaluation of the overall package of
services provided by Columbia Management, the Board considered the quality of
the administrative and transfer agency services provided by Columbia
Management's affiliates to the Fund. The Board also reviewed the financial
condition of Columbia Management and its affiliates, and each entity's ability
to carry out its responsibilities under the IMS Agreement. Further, the Board
considered Columbia Management's ability to retain key personnel in certain
targeted areas and its expectations in this regard. The Board also discussed the
acceptability of the terms of the IMS Agreement (including the relatively broad
scope of services required to be performed by Columbia Management). The Board
concluded that the services being performed under the IMS Agreement were of a
reasonably high quality.
Based on the foregoing, and based on other information received (both oral and
written, including the information on investment performance referenced below)
and other considerations, the Board concluded that Columbia Management and its
affiliates were in a position to continue to provide a high quality and level of
services to the Fund.
Investment Performance: For purposes of evaluating the nature, extent and
quality of services provided under the IMS Agreement, the Board carefully
reviewed the investment performance of the Fund. In this regard, the Board
considered detailed reports containing data prepared by an independent
organization showing, for various periods, the performance of the Fund, the
performance of a benchmark index, the percentage ranking of the Fund among its
comparison group and the net assets of the Fund. The Board observed that the
Fund's investment performance reflected the interrelationship of market
conditions with the particular investment strategies employed by the portfolio
- --------------------------------------------------------------------------------
76 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
- --------------------------------------------------------------------------------
management team. Further, the Board noted measures taken to address the Fund's
performance, including the anticipated change in portfolio managers for the
Fund. In this regard, the Board reviewed a detailed report illustrating the
performance and track record of the new portfolio managers expected to assume
responsibilities for the Fund upon the close of the Columbia Transaction.
Comparative Fees, Costs of Services Provided and the Profits Realized By
Columbia Management and its Affiliates from their Relationships with the Fund:
The Board reviewed comparative fees and the costs of services to be provided
under the IMS Agreement. The Board members considered detailed comparative
information set forth in an annual report on fees and expenses, including, among
other things, data (prepared by an independent organization) showing a
comparison of the Fund's expenses with median expenses paid by funds in its peer
group, as well as data showing the Fund's contribution to Columbia Management's
profitability. They also reviewed information in the report showing the fees
charged by Columbia Management to other client accounts (with similar investment
strategies to those of the Fund).
The Board accorded particular weight to the notion that the level of fees should
reflect a rational pricing model applied consistently across the various product
lines in the legacy RiverSource Funds' family, while assuring that the overall
fees for each fund (with few defined exceptions) are generally in line with the
"pricing philosophy" (i.e., that the total expense ratio of each fund (excluding
the effect of a performance incentive adjustment), with few exceptions, is at or
below the median expense ratio of funds in the same comparison group). The Board
took into account that the Fund's total expense ratio (after considering
proposed expense caps/waivers) approximated the peer group's median expense
ratio. The Board also considered the Fund's performance incentive adjustment and
noted its continued appropriateness. Based on its review, the Board concluded
that the Fund's management fee was fair and reasonable in light of the extent
and quality of services that the Fund receives.
The Board also considered various preliminary integration plans in connection
with the Columbia Transaction which, if implemented, would impact the fee
structures of various legacy RiverSource Funds. The Board was satisfied with the
principles underlying these plans, which, at their preliminary stage, are
designed to achieve a rational, consistent pricing model across the combined
fund families, as well as preserve the "pricing philosophy" of the legacy
RiverSource Funds.
The Board also considered the expected profitability of Columbia Management and
its affiliates in connection with Columbia Management providing investment
- --------------------------------------------------------------------------------
COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT 77
APPROVAL OF INVESTMENT MANAGEMENT SERVICES
AGREEMENT (continued) ----------------------------------------------------------
management services to the Fund. In this regard, the Board referred to a
detailed profitability report, discussing the profitability to Columbia
Management and Ameriprise Financial from managing and operating the Fund,
including data showing comparative profitability over the past two years. In
this regard, the Board observed slightly reduced profitability in 2009 vs. 2008.
The Board also considered the services acquired by the investment manager
through the use of commission dollars paid by the legacy RiverSource Funds on
portfolio transactions. The Board noted that the fees paid by the Fund should
permit the investment manager to offer competitive compensation to its
personnel, make necessary investments in its business and earn an appropriate
profit. The Board concluded that profitability levels were reasonable.
Economies of Scale to be Realized: The Board also considered the economies of
scale that might be realized by Columbia Management as the Fund grows and took
note of the extent to which Fund shareholders might also benefit from such
growth. The Board considered that the IMS Agreement provides for lower fees as
assets increase at pre-established breakpoints and concluded that the IMS
Agreement satisfactorily provided for sharing these economies of scale.
Based on the foregoing, the Board, including all of the Independent Directors,
concluded that the investment management service fees were fair and reasonable
in light of the extent and quality of services provided. In reaching this
conclusion, no single factor was determinative. On April 8, 2010, the Board,
including all of the Independent Directors, approved the renewal of the IMS
Agreement for an additional annual period.
PROXY VOTING -------------------------------------------------------------------
The policy of the Board is to vote the proxies of the companies in which the
Fund holds investments consistent with the procedures as stated in the Statement
of Additional Information (SAI). You may obtain a copy of the SAI without charge
by calling 800.345.6611; contacting your financial intermediary; visiting
columbiamanagement.com; or searching the website of the Securities and Exchange
Commission (SEC) at http://www.sec.gov. Information regarding how the Fund voted
proxies relating to portfolio securities is filed with the SEC by August 31 for
the most recent 12-month period ending June 30 of that year, and is available
without charge by visiting columbiamanagement.com; or searching the website of
the SEC at www.sec.gov.
- --------------------------------------------------------------------------------
78 COLUMBIA LARGE CORE QUANTITATIVE FUND -- 2010 ANNUAL REPORT
COLUMBIA LARGE CORE QUANTITATIVE FUND
(FORMERLY KNOWN AS RIVERSOURCE DISCIPLINED EQUITY FUND)
P.O. Box 8081
Boston, MA 02266-8081
COLUMBIAMANAGEMENT.COM
<Table>
This report must be accompanied or preceded by the Fund's
current prospectus. The Fund is distributed by Columbia
Management Investment Distributors, Inc. member FINRA, and
managed by Columbia Management Investment Advisers, LLC.
(C)2010 Columbia Management Investment Advisers, LLC. All
(COLUMBIA MANAGEMENT LOGO) rights reserved. S-6263 K (9/10)
</Table>
Item 2. Code of Ethics.
(a) The Registrant has adopted a code of ethics that applies to the
Registrant's principal executive officer and principal financial officer.
(b) During the period covered by this report, there were not any amendments
to a provision of the code of ethics adopted in 2(a) above.
(c) During the period covered by this report, there were no waivers,
including any implicit waivers, from a provision of the code of ethics
described in 2(a) above that relates to one or more of the items set forth
in paragraph (b) of this item's instructions.
Item 3. Audit Committee Financial Expert.
The Registrant's board of directors has determined that independent
directors Pamela G. Carlton, Jeffrey Laikind, John F. Maher and Anne P.
Jones, each qualify as audit committee financial experts.
Item 4. Principal Accountant Fees and Services
(a) Audit Fees. The fees for the year ended July 31, to Ernst & Young LLP for
professional services rendered for the audits of the annual financial
statements for RiverSource Large Cap Series, Inc. were as follows:
2010 - $20,127 2009 - $80,284
(b) Audit-Related Fees. The fees for the year ended July 31, to Ernst & Young
LLP for additional audit-related services rendered related to the
semiannual financial statement review and the 2010 transfer agent 17Ad-13
review for RiverSource Large Cap Series, Inc. were as follows:
2010 - $3,162 2009 - $1,500
(c) Tax Fees. The fees for the year ended July 31, to Ernst & Young LLP for tax
compliance related services rendered for RiverSource Large Cap Series, Inc.
were as follows:
2010 - $17,471 2009 - $28,872
(d) All Other Fees. The fees for the year ended July 31, to Ernst & Young LLP
for additional professional services rendered for RiverSource Large Cap
Series, Inc. were as follows:
2010 - $0 2009 - $0
(e) (1) Audit Committee Pre-Approval Policy. Pursuant to Sarbanes-Oxley
pre-approval requirements, all services to be performed by Ernst & Young
LLP for the registrant and to the registrant's investment adviser and any
entity controlling, controlled by, or under common control with the
investment adviser that provides ongoing services to the registrant must be
pre-approved by the audit committee.
(e) (2) 100% of the services performed for items (b) through (d) above during
2010 and 2009 were pre-approved by the audit committee.
(f) Not applicable.
(g) Non-Audit Fees. The fees for the year ended July 31, to Ernst & Young LLP
by the registrant for non-audit fees and by the registrant's investment
adviser, and any entity controlling, controlled by, or under common control
with the adviser that provides ongoing services to the registrant were as
follows:
2010 - $2,131,594 2009 - $852,858
(h) 100% of the services performed in item (g) above during 2010 and 2009 were
pre-approved by the Ameriprise Financial Audit Committee and/or the
RiverSource Mutual Funds Audit Committee.
Item 5. Audit Committee of Listed Registrants. Not applicable.
Item 6. Investments.
(a) The registrant's "Schedule 1 - Investments in securities of unaffiliated
issuers" (as set forth in 17 CFR 210.12-12) is included in Item 1 of this
Form N-CSR.
(b) Not applicable.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies. Not applicable.
Item 8. Portfolio Managers of Closed-End Management Investment Companies. Not
applicable.
Item 9. Purchases of Equity Securities by Closed-End Management Investment
Company and Affiliated Purchasers. Not applicable.
Item 10. Submission of Matters to a Vote of Security Holders.
There were no material changes to the procedures by which shareholders may
recommend nominees to the registrant's board of directors.
Item 11. Controls and Procedures.
(a) The registrant's principal executive officer and principal financial
officer, based on their evaluation of the registrant's disclosure controls
and procedures as of a date within 90 days of the filing of this report,
have concluded that such controls and procedures are adequately designed to
ensure that information required to be disclosed by the registrant in Form
N-CSR is accumulated and communicated to the registrant's management,
including principal executive officer and principal financial officer, or
persons performing similar functions, as appropriate to allow timely
decisions regarding required disclosure.
(b) There was no change in the registrant's internal controls over
financial reporting that occurred during the registrant's second fiscal
quarter of the period covered by this report that has materially affected,
or is reasonably likely to materially affect, the registrant's internal
control over financial reporting.
Item 12. Exhibits.
(a)(1) Code of ethics required to be disclosed under Item 2 of Form N-CSR,
is attached as Exhibit 99.CODE ETH.
(a)(2) Certifications pursuant to Rule 30a-2(a) under the Investment
Company Act of 1940 (17 CFR 270.30a-2(a)) attached hereto as
Exhibit99.CERT.
(a)(3) Not applicable.
(b) Certification pursuant to Rule 30a-2(b) under the Investment Company
Act of 1940 (17 CFR 270.30a-2(b)) attached hereto as Exhibit 99.906CERT.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the Registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) RiverSource Large Cap Series, Inc.
By /s/ J. Kevin Connaughton
----------------------------------
J. Kevin Connaughton
President and Principal Executive
Officer
Date October 7, 2010
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 /s/ J. Kevin Connaughton
---------------------------------
J. Kevin Connaughton
President and Principal Executive
Officer
Date October 7, 2010
By /s/ Jeffrey P. Fox
---------------------------------
Jeffrey P. Fox
Treasurer and Principal Financial
Officer
Date October 7, 2010