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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number 811-21792
AIM Core Allocation Portfolio Series
(Exact name of registrant as specified in charter)
11 Greenway Plaza, Suite 100 Houston, Texas 77046
(Address of principal executive offices) (Zip code)
Philip A. Taylor 11 Greenway Plaza, Suite 100 Houston, Texas 77046
(Name and address of agent for service)
Registrant's telephone number, including area code: (713) 626-1919
Date of fiscal year end: 8/31
Date of reporting period: 2/29/08
Item 1. Reports to Stockholders.
[Invesco Aim LOGO] AIM CORE ALLOCATION PORTFOLIO SERIES
- - SERVICE MARK - SERIES C AND SERIES M
Semiannual Report to Shareholders February 29, 2008
THE FUNDS ARE USED EXCLUSIVELY FOR SEPARATELY MANAGED ACCOUNTS (E.G., WRAP FEE
OR CERTAIN OTHER PROGRAMS) ADVISED OR SUB-ADVISED BY INVESCO AIM ADVISORS, INC.
(THE ADVISOR OR INVESCO AIM) OR ITS AFFILIATES FOR WHOM INVESCO AIM OR ITS
AFFILIATES HAS A CORE FIXED INCOME MANDATE. THE FUNDS ARE DESIGNED TO BE A
PORTION (ALTHOUGH NOT THE WHOLE) OF A CORE FIXED INCOME PORTFOLIO. INVESCO AIM
HAS ENGAGED THE SERVICES OF INVESCO INSTITUTIONAL (N.A.), INC. (THE SUB-ADVISOR
OR INVESCO) TO PROVIDE SUB-ADVISORY SERVICES TO THE FUNDS.
AIM Investments became 2 Fund performance
INVESCO AIM on March 3 Letter to shareholders
31, 2008. 4 Schedule of investments
8 Financial statements
For more details, go to 12 Notes to financial statements
invescoaim.com 18 Financial highlights
20 Fund expenses
Unless otherwise noted, all data provided by Invesco Aim.
THIS REPORT MUST BE ACCOMPANIED OR PRECEDED BY A CURRENTLY EFFECTIVE FUND
PROSPECTUS, WHICH CONTAINS MORE COMPLETE INFORMATION, INCLUDING SALES CHARGES
AND EXPENSES. INVESTORS SHOULD READ IT CAREFULLY BEFORE INVESTING.
NOT FDIC INSURED MAY LOSE VALUE NO BANK GUARANTEE
FUND PERFORMANCE
PERFORMANCE SUMMARY
For the six months ended February 29, 2008, Series C and Series M, at net asset
value (NAV), returned 7.32% and 4.13%, respectively. The Funds are a component
of Invesco Full Discretion Core product, and therefore have no benchmark
indexes. The benchmark index for Invesco Full Discretion Core product is the
Lehman Brothers U.S. Aggregate Bond Index-, which returned 5.67% for the six
months ended February 29, 2008.
Source: -Lipper Inc.
The LEHMAN BROTHERS U.S. AGGREGATE BOND INDEX covers U.S. investment-grade
fixed-rate bonds with components for government and corporate securities,
mortgage pass-throughs, and asset-backed securities.
The Fund is not managed to track the performance of any particular index,
including the indexes defined here, and consequently, the performance of the
Fund may deviate significantly from the performance of the indexes.
A direct investment cannot be made in an index. Unless otherwise indicated,
index results include reinvested dividends, and they do not reflect sales
charges. Performance of an index of funds reflects fund expenses; performance of
a market index does not.
AVERAGE ANNUAL TOTAL RETURNS
As of 2/29/08
SERIES C
Inception (12/30/05) 7.00%
1 Year 8.08
SERIES M
Inception (12/30/05) 4.73%
1 Year 5.02
AVERAGE ANNUAL TOTAL RETURNS
As of 12/31/07, the most recent calendar quarter-end
SERIES C
Inception (12/30/05) 6.03%
1 Year 7.84
SERIES M
Inception (12/30/05) 4.53%
1 Year 5.27
THE PERFORMANCE DATA QUOTED REPRESENT PAST PERFORMANCE AND CANNOT GUARANTEE
COMPARABLE FUTURE RESULTS; CURRENT PERFORMANCE MAY BE LOWER OR HIGHER. PLEASE
CONTACT YOUR SEPARATELY MANAGED ACCOUNT ISSUER OR FINANCIAL ADVISOR FOR THE MOST
RECENT MONTH-END PERFORMANCE. PERFORMANCE FIGURES REFLECT FUND EXPENSES,
REINVESTED DISTRIBUTIONS AND CHANGES IN NET ASSET VALUE. INVESTMENT RETURN AND
PRINCIPAL VALUE WILL FLUCTUATE SO THAT YOU MAY HAVE A GAIN OR LOSS WHEN YOU SELL
SHARES.
THE NET ANNUAL FUND OPERATING EXPENSE RATIO SET FORTH IN THE MOST RECENT
FUND PROSPECTUS AS OF THE DATE OF THIS REPORT FOR SERIES C AND SERIES M WAS
0.00% AND 0.00%, RESPECTIVELY.(1) THE TOTAL ANNUAL FUND OPERATING EXPENSE RATIO
SET FORTH IN THE MOST RECENT FUND PROSPECTUS AS OF THE DATE OF THIS REPORT FOR
SERIES C AND SERIES M WAS 0.23% AND 0.23%, RESPECTIVELY.
THE FUNDS ARE USED EXCLUSIVELY FOR SEPARATELY MANAGED ACCOUNTS ADVISED OR
SUB-ADVISED BY INVESCO AIM ADVISORS, INC. OR ITS AFFILIATES FOR WHOM INVESCO AIM
OR ITS AFFILIATES HAS A CORE FIXED INCOME MANDATE. THE FUNDS ARE DESIGNED TO BE
A PORTION OF A CORE FIXED INCOME PORTFOLIO. YOU CANNOT PURCHASE SHARES OF THE
FUND DIRECTLY.
PERFORMANCE FIGURES GIVEN REPRESENT THE FUNDS AND ARE NOT INTENDED TO
REFLECT ACTUAL SEPARATELY MANAGED ACCOUNT VALUES. THEY DO NOT REFLECT CHARGES
ASSESSED IN CONNECTION WITH A SEPARATELY MANAGED ACCOUNT. CHARGES, EXPENSES AND
FEES, WHICH ARE DETERMINED BY THE SEPARATELY MANAGED ACCOUNT ISSUER, WILL VARY
AND WILL LOWER THE TOTAL RETURN.
(1) Invesco Aim has agreed to irrevocably waive all fees and pay all operating
expenses, except for (i) all brokers' commissions, issue and transfer
taxes, foreign taxes and other costs chargeable to AIM Core Allocation
Portfolio Series (the Trust) of the Fund in connection with securities
transactions to which the Trust or the Fund is a party or in connection
with securities owned by the Trust or the Fund; (ii) costs, including
interest expense, of borrowing money; and (iii) extraordinary items such as
litigation costs authorized by the Board of Trustees.
2 AIM CORE ALLOCATION PORTFOLIO SERIES
[CROCKETT PHOTO]
Bruce Crockett
Dear Fellow AIM Fund Shareholders:
The lines of communication are open: More than 250 of you have responded to the
invitation I extended in my previous letter to complete an online survey, and
more than 50 shareholders have contacted me directly by e-mail. When I could
respond quickly and easily to a shareholder's specific concern I did, but the
messages for the most part raised consistent issues that I respond to here.
I have received many suggestions, a few complaints, and one offer to buy a
gold mine! In general, your letters expressed an appreciation for transparency,
frankness and the opportunity to comment. Nevertheless, several shareholders
found room for improvement in communications. Some would like more concise
letters while others would prefer reports to be more customized for their
particular information needs. With these reports going to tens of thousands of
people, shareholder communications necessarily have to cover those issues common
to a diverse population as well as the information required by law. The ability
to change or further customize letters and reports is also affected by
technology, timeliness and cost.
Online survey responders preferred electronic communications to paper at a
ratio of 63% to 37%. Direct responders expressed more of a preference for paper,
especially for long reports. Electronic communications are more cost-effective
than paper communications that have to be printed and mailed, so I encourage
those who have resisted electronic communications to give them a try.
The correspondence shows that improving fund performance and reducing
shareholder costs remain the key shareholder concerns. Several letters noted
individual funds where performance had changed for the better, while others
remained dissatisfied with the returns from funds they hold. Although 75% of the
online survey responders wanted to see more overall fund performance data in
these letters, and 58% wanted more information on individual funds, Securities
and Exchange Commission (SEC) and Financial Industry Regulatory Authority
(FINRA) rules are very specific about the way fund performance can be discussed
in print. Respect for those rules prevents me from commenting on individual
funds or very recent results here, but I can assure you that your Board and all
of its Investments subcommittees continue to work with Invesco Aim to make
improved performance a top priority for all fund managers.
Expense levels came up as another dominant issue, and no respondent felt
these were too low. Several shareholders questioned the need for 12b-1 fees,
which cover the cost of distributing fund shares and thereby help the fund to
attract new assets. Your Board reviews the funds' 12b-1 fees annually with the
shareholders' best interests in mind. While your Board keeps its eye on
containing or lowering these fees wherever possible, we also are mindful that
12b-1 fees may be necessary in order to maintain an effective distribution
system for fund shares.
The value of communication between the Board and shareholders has been
noted within and beyond the Invesco Aim community. In the online survey, 87% of
the respondents felt it was either somewhat or very important to hear directly
from the Board, with 55% saying it was very important. Morningstar--TRADEMARK--,
the mutual fund tracking company, also commented favorably on this channel of
communication in its fall 2007 update of fund stewardship grades, where Invesco
Aim was one of fewer than 10 fund boards to get an A for board quality,
according to BoardIQ (11/13/07).
In other news, Ruth Quigley retired from your Board at the end of 2007, and
we thank her for her many years of dedicated service. Larry Soll has assumed
Ruth's place as a vice chair of the Investments Committee. The Valuation
Committee, which Ruth used to chair, has been reorganized as the Valuation,
Distribution and Proxy Oversight Committee under the chairmanship of Carl
Frischling. The elevation of proxy oversight to standing committee status
responds to suggestions from shareholders. In addition, Prema Mathai-Davis
assumed my seat on the Governance Committee, and I moved to the Audit Committee.
Your Board looks forward to another year of diligent effort on your behalf,
and we are even more strongly motivated by your feedback. The invitation remains
open to e-mail me at bruce@brucecrockett.com. I look forward to hearing from
you.
Sincerely,
/s/ Bruce L. Crockett
- ---------------------------------
Bruce L. Crockett
Independent Chair
AIM Funds Board of Trustees
APRIL 16, 2008
3 AIM CORE ALLOCATION PORTFOLIO SERIES
PORTFOLIO COMPOSITION
By security type, based on Total Investments
as of February 29, 2008
<Table>
- -------------------------------------------------------------------------
U.S. Dollar Denominated Bonds & Notes 36.7%
- -------------------------------------------------------------------------
U.S. Treasury Securities 32.6
- -------------------------------------------------------------------------
U.S. Mortgage-Backed Securities 22.9
- -------------------------------------------------------------------------
U.S. Government Sponsored Agency Securities 0.7
- -------------------------------------------------------------------------
Money Market Funds 7.1
_________________________________________________________________________
=========================================================================
</Table>
SCHEDULE OF INVESTMENTS(a)
February 29, 2008
(Unaudited)
SERIES C
<Table>
<Caption>
PRINCIPAL
AMOUNT VALUE
- ------------------------------------------------------------------------------
BONDS & NOTES-43.51%(B)
BROADCASTING & CABLE TV-6.81%
Comcast Corp., Sr. Unsec. Unsub. Gtd. Notes,
5.90%, 03/15/16 $ 520,000 $ 524,561
==============================================================================
DATA PROCESSING & OUTSOURCED SERVICES-2.76%
Broadridge Financial Solutions Inc., Sr. Unsec.
Notes, 6.13%, 06/01/17 230,000 212,644
==============================================================================
DIVERSIFIED BANKS-5.52%
Citigroup Inc, Sr. Unsec. Global Notes, 6.88%,
03/05/38 215,000 217,528
- ------------------------------------------------------------------------------
Wachovia Corp., Sr. Unsec. Notes, 5.35%, 03/15/11 200,000 207,800
==============================================================================
425,328
==============================================================================
ELECTRIC UTILITIES-3.33%
Exelon Generation Co. LLC, Sr. Unsec. Notes,
6.20%, 10/01/17 250,000 256,280
==============================================================================
INTEGRATED TELECOMMUNICATION SERVICES-1.31%
Verizon Communications Inc., Sr. Unsec. Notes,
5.50%, 02/15/18 100,000 101,111
==============================================================================
INVESTMENT BANKING & BROKERAGE-1.13%
Goldman Sachs Group, Inc. (The), Sub. Global
Notes, 6.75%, 10/01/37 90,000 86,758
==============================================================================
MANAGED HEALTH CARE-1.81%
UnitedHealth Group Inc., Bonds, 6.88%, 02/15/38 140,000 139,212
==============================================================================
MULTI-LINE INSURANCE-3.37%
Liberty Mutual Group Inc., Jr. Unsec. Gtd. Sub.
Bonds, 7.80%, 03/15/37(c) 300,000 259,557
==============================================================================
OTHER DIVERSIFIED FINANCIAL SERVICES-4.53%
Citigroup Inc., Sr. Unsec. Unsub. Global Notes,
5.85%, 07/02/13 100,000 105,922
- ------------------------------------------------------------------------------
Lazard Group, Sr. Unsec. Global Notes, 6.85%,
06/15/17 250,000 243,400
==============================================================================
349,322
==============================================================================
<Caption>
PRINCIPAL
AMOUNT VALUE
- ------------------------------------------------------------------------------
RESIDENTIAL REIT'S-2.79%
ERP Operating L.P., Sr. Unsec. Unsub. Notes,
5.13%, 03/15/16 $ 240,000 $ 214,776
==============================================================================
SOVEREIGN DEBT-2.03%
United Mexican States (Mexico), Global Notes,
5.63%, 01/15/17 150,000 156,495
==============================================================================
SPECIALIZED REIT'S-4.61%
HCP, Inc., Sr. Unsec. Medium-Term Notes, 6.70%,
01/30/18 400,000 354,912
==============================================================================
THRIFTS & MORTGAGE FINANCE-3.51%
Countrywide Financial Corp., Unsec. Gtd. Unsub.
Medium-Term Global Notes, 5.80%, 06/07/12 300,000 270,750
==============================================================================
Total Bonds & Notes (Cost $3,448,513) 3,351,706
==============================================================================
U.S. TREASURY SECURITIES-38.69%(B)
U.S. TREASURY NOTES-33.26%
4.50%, 04/30/12 1,450,000 1,576,425
- ------------------------------------------------------------------------------
4.25%, 11/15/13 910,000 985,503
==============================================================================
2,561,928
==============================================================================
U.S. TREASURY BONDS-5.43%
8.13%, 08/15/19 300,000 417,891
==============================================================================
Total U.S. Treasury Securities (Cost
$2,867,931) 2,979,819
==============================================================================
U.S. MORTGAGE-BACKED SECURITIES-27.11%(B)
FEDERAL HOME LOAN MORTGAGE CORP. (FHLMC)-11.06%
Pass Through Ctfs., TBA, 6.50%, 03/01/38(d) 820,000 851,647
==============================================================================
</Table>
4 AIM CORE ALLOCATION PORTFOLIO SERIES
<Table>
<Caption>
PRINCIPAL
AMOUNT VALUE
- ------------------------------------------------------------------------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA)-16.05%
Pass Through Ctfs.,
6.00%, 09/01/36 $ 724,547 $ 744,173
- ------------------------------------------------------------------------------
Pass Through Ctfs., TBA,
5.00%, 03/01/38(d) 500,000 492,422
==============================================================================
1,236,595
==============================================================================
Total U.S. Mortgage-Backed Securities (Cost
$2,062,719) 2,088,242
U.S. GOVERNMENT SPONSORED AGENCY SECURITIES-0.78%
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA)-0.78%
Sr. Unsec. Disc. Notes, 4.19%, 04/07/08 (Cost
$59,742)(e)(f) 60,000 59,742
==============================================================================
<Caption>
SHARES VALUE
- ------------------------------------------------------------------------------
MONEY MARKET FUNDS-8.46%
Liquid Assets Portfolio-Institutional Class(g)(h) 325,719 $ 325,719
- ------------------------------------------------------------------------------
Premier Portfolio-Institutional Class(g)(h) 325,719 325,719
==============================================================================
Total Money Market Funds (Cost $651,438) 651,438
==============================================================================
TOTAL INVESTMENTS-118.55% (Cost $9,090,343) 9,130,947
==============================================================================
OTHER ASSETS LESS LIABILITIES-(18.55)% (1,428,505)
==============================================================================
NET ASSETS-100.00% $ 7,702,442
______________________________________________________________________________
==============================================================================
</Table>
Investment Abbreviations:
<Table>
Ctfs. - Certificates
Disc. - Discounted
Gtd. - Guaranteed
Jr. - Junior
REIT - Real Estate Investment Trust
Sr. - Senior
Sub. - Subordinated
TBA - To Be Assigned
Unsec. - Unsecured
Unsub. - Unsubordinated
</Table>
Notes to Schedule of Investments:
(a) Industry classifications used in this report are generally according to
the Global Industry Classification Standard, which was developed by and is
the exclusive property and a service mark of Morgan Stanley Capital
International Inc. and Standard & Poor's.
(b) In accordance with the procedures established by the Board of Trustees,
security fair valued based on an evaluated quote provided by an
independent pricing service. The aggregate value of these securities at
February 29, 2008 was $8,419,767, which represented 109.31% of the Fund's
Net Assets. See Note 1A.
(c) Security, purchased in transactions exempt from registration under the
Securities Act of 1933, as amended The security may be resold pursuant to
an exemption from registration under the 1933 Act, typically to qualified
institutional buyers. The aggregate value of this security at February 29,
2008 represented 3.37% of the Fund's Net Assets. Unless otherwise
indicated, these securities are not considered to be illiquid.
(d) Security purchased on a forward commitment basis. This security is subject
to dollar roll transactions. See Note 1I.
(e) Zero coupon bond issued at a discount. The interest rate shown represents
the yield to maturity at issue.
(f) All or a portion of the value was pledged as collateral to cover margin
requirements for open futures contracts. See Note 1L and Note 5.
(g) The money market fund and the Fund are affiliated by having the same
investment advisor.
(h) Security is considered a cash equivalent for the purpose of the Statement
of Cash Flows. See Note 1H.
See accompanying Notes to Financial Statements which are an integral part of the
financial statements.
5 AIM CORE ALLOCATION PORTFOLIO SERIES
PORTFOLIO COMPOSITION
By security type, based on Total Investments
as of February 29, 2008
<Table>
- -------------------------------------------------------------------------
Asset-Backed Securities 46.2%
- -------------------------------------------------------------------------
U.S. Mortgage-Backed Securities 44.8
- -------------------------------------------------------------------------
U.S. Government Sponsored Agency Securities 0.4
- -------------------------------------------------------------------------
Money Market Funds 8.6
_________________________________________________________________________
=========================================================================
</Table>
SCHEDULE OF INVESTMENTS(a)
February 29, 2008
(Unaudited)
SERIES M
<Table>
<Caption>
PRINCIPAL
AMOUNT VALUE
- ------------------------------------------------------------------------------
ASSET-BACKED SECURITIES-61.45%.(B)
COLLATERALIZED MORTGAGE OBLIGATIONS-61.45%
Bear Stearns Commercial Mortgage Securities-Series
2007-T28, Class AM, Floating Rate, 5.84%,
09/11/42(c) $ 250,000 $ 217,481
- ------------------------------------------------------------------------------
Commercial Mortgage Pass Through Ctfs.-Series
2006-C7, Class A4, Floating Rate Pass Through
Ctfs., 5.77%, 06/10/46(c) 25,000 24,639
- ------------------------------------------------------------------------------
CS First Boston Mortgage Securities Corp.-Series
2004-C5, Class A2, 4.18%, 11/15/37 290,000 285,073
- ------------------------------------------------------------------------------
Fannie Mae REMICS-Series 2006-123, Class BO, Pass
Through Ctfs., 0.92%, 01/25/37(d) 833,094 673,750
- ------------------------------------------------------------------------------
Freddie Mac REMICS,
Series 2405, Class PE,
6.00%, 01/15/17 559,186 591,947
- ------------------------------------------------------------------------------
Series 2425, Class JH,
6.00%, 03/15/17 519,759 548,433
- ------------------------------------------------------------------------------
JP Morgan Mortgage Trust-Series 2006-A3, Class
2A3, Floating Rate, 5.62%, 05/25/36(c) 750,000 762,074
- ------------------------------------------------------------------------------
LB-UBS Commercial Mortgage Trust-Series 2007-C1,
Class AM, 5.46%, 02/15/40 500,000 428,659
- ------------------------------------------------------------------------------
Structured Adjustable Rate Mortgage Loan Trust,
Series 2004-1, Class 3A1,
Floating Rate,
6.98%, 02/25/34(c) 191,025 194,262
- ------------------------------------------------------------------------------
Series 2004-6, Class 1A,
Floating Rate,
7.10%, 06/25/34(c) 117,909 118,754
- ------------------------------------------------------------------------------
Wells Fargo Mortgage Backed Securities Trust,
Series 2005-AR12, Class 2A6,
Floating Rate,
4.33%, 07/25/35(c) 389,322 385,648
- ------------------------------------------------------------------------------
Series 2005-AR8, Class 2A1,
Floating Rate,
4.54%, 06/25/35(c) 424,912 421,761
==============================================================================
Total Asset-Backed Securities (Cost
$4,641,524) 4,652,481
==============================================================================
<Caption>
PRINCIPAL
AMOUNT VALUE
- ------------------------------------------------------------------------------
U.S. MORTGAGE-BACKED SECURITIES-59.62%(B)
FEDERAL HOME LOAN MORTGAGE CORP. (FHLMC)-6.31%
Pass Through Ctfs., TBA, 5.50%, 03/01/38(e) $ 475,000 $ 477,746
==============================================================================
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA)-53.31%
Pass Through Ctfs.,
5.50%, 11/01/34 to 02/01/35 842,886 850,067
- ------------------------------------------------------------------------------
5.00%, 02/01/35 434,654 429,690
- ------------------------------------------------------------------------------
6.00%, 09/01/36 724,547 744,173
- ------------------------------------------------------------------------------
Pass Through Ctfs., TBA,
5.50%, 03/01/38(e) 2,000,000 2,011,563
==============================================================================
4,035,493
==============================================================================
Total U.S. Mortgage-Backed Securities (Cost
$4,431,924) 4,513,239
==============================================================================
U.S. GOVERNMENT SPONSORED AGENCY SECURITIES-0.53%
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA)-0.53%
Sr. Unsec. Disc. Notes, 4.19%, 04/07/08 (Cost
$39,828)(f)(g) 40,000 39,828
==============================================================================
<Caption>
SHARES
MONEY MARKET FUNDS-11.52%
Liquid Assets Portfolio-Institutional Class(h)(i) 436,039 436,039
- ------------------------------------------------------------------------------
Premier Portfolio-Institutional Class(h)(i) 436,039 436,039
==============================================================================
Total Money Market Funds (Cost $872,078) 872,078
==============================================================================
TOTAL INVESTMENTS-133.12% (Cost $9,985,354) 10,077,626
==============================================================================
OTHER ASSETS LESS LIABILITIES-(33.12)% (2,507,134)
==============================================================================
NET ASSETS-100.00% $ 7,570,492
______________________________________________________________________________
==============================================================================
</Table>
6 AIM CORE ALLOCATION PORTFOLIO SERIES
Investment Abbreviations:
<Table>
Ctfs. - Certificates
Disc. - Discounted
REMICS - Real Estate Mortgage Investment Conduits
Sr. - Senior
TBA - To Be Assigned
Unsec. - Unsecured
</Table>
Notes to Schedule of Investments:
(a) Industry classifications used in this report are generally according to
the Global Industry Classification Standard, which was developed by and is
the exclusive property and a service mark of Morgan Stanley Capital
International Inc. and Standard & Poor's.
(b) In accordance with the procedures established by the Board of Trustees,
security fair valued based on an evaluated quote provided by an
independent pricing service. The aggregate value of these securities at
February 29, 2008 was $9,165,720, which represented 121.07% of the Fund's
Net Assets. See Note 1A.
(c) Interest or dividend rate is redetermined periodically. Rate shown is the
rate in effect on February 29, 2008.
(d) Zero coupon bond issued at a discount. The interest rate shown represents
the yield to maturity at time of purchase.
(e) Security purchased on a forward commitment basis. This security is subject
to dollar roll transactions. See Note 1I.
(f) Security traded on a discount basis. The interest rate shown represents
the discount rate at the time of purchase by the Fund.
(g) All or a portion of the value was pledged as collateral to cover margin
requirements for open futures contracts. See Note 1L and Note 5.
(h) The money market fund and the Fund are affiliated by having the same
investment advisor.
(i) Security is considered a cash equivalent for the purpose of the Statement
of Cash Flows. See Note 1H.
See accompanying Notes to Financial Statements which are an integral part of the
financial statements.
7 AIM CORE ALLOCATION PORTFOLIO SERIES
STATEMENT OF ASSETS AND LIABILITIES
February 29, 2008
(Unaudited)
<Table>
<Caption>
SERIES C SERIES M
-----------
ASSETS:
Investments, at value $ 8,479,509 $ 9,205,548
- ------------------------------------------------------------------------- ----------- -----------
Investments in affiliated money market funds, at value 651,438 872,078
========================================================================= =========== ===========
Total investments 9,130,947 10,077,626
========================================================================= =========== ===========
Receivables for:
Investments sold 979,956 1,215,236
- ------------------------------------------------------------------------- ----------- -----------
Variation margin 31,787 --
- ------------------------------------------------------------------------- ----------- -----------
Dividends and interest 102,054 32,316
========================================================================= =========== ===========
Total assets 10,244,744 11,325,178
========================================================================= =========== ===========
LIABILITIES:
Payables for:
Investments purchased 2,542,302 3,720,410
- ------------------------------------------------------------------------- ----------- -----------
Dividends -- 32,917
- ------------------------------------------------------------------------- ----------- -----------
Variation margin -- 1,359
========================================================================= =========== ===========
Total liabilities 2,542,302 3,754,686
========================================================================= =========== ===========
Net assets applicable to shares outstanding $ 7,702,442 $ 7,570,492
========================================================================= =========== ===========
NET ASSETS CONSIST OF:
Shares of beneficial interest $ 7,445,140 $ 7,494,428
- ------------------------------------------------------------------------- ----------- -----------
Undistributed net investment income 6,375 28,511
- ------------------------------------------------------------------------- ----------- -----------
Undistributed net realized gain (loss) 167,675 (46,251)
- ------------------------------------------------------------------------- ----------- -----------
Unrealized appreciation 83,252 93,804
========================================================================= =========== ===========
$ 7,702,442 $ 7,570,492
========================================================================= =========== ===========
SHARES OUTSTANDING, $0.01 PAR VALUE PER SHARE, UNLIMITED NUMBER OF SHARES
AUTHORIZED:
Outstanding 760,639 765,068
- ------------------------------------------------------------------------- ----------- -----------
Net asset value per share $ 10.13 $ 9.90
- ------------------------------------------------------------------------- ----------- -----------
Cost of investments $ 8,438,905 $ 9,113,276
- ------------------------------------------------------------------------- ----------- -----------
Cost of investments in affiliated money market funds $ 651,438 $ 872,078
========================================================================= =========== ===========
Total investments, at cost $ 9,090,343 $ 9,985,354
========================================================================= =========== ===========
</Table>
See accompanying Notes to Financial Statements which are an integral part of the
financial statements.
8 AIM CORE ALLOCATION PORTFOLIO SERIES
STATEMENT OF OPERATIONS
For the six months ended February 29, 2008
(Unaudited)
<Table>
<Caption>
SERIES C SERIES M
--------
INVESTMENT INCOME:
Interest $238,611 $235,867
- -------------------------------------------------------------------------- -------- --------
Dividends from affiliated money market funds 15,368 16,307
========================================================================== ======== ========
Total investment income 253,979 252,174
========================================================================== ======== ========
EXPENSES:
Management fees 10,584 10,491
- -------------------------------------------------------------------------- -------- --------
Less: Fees waived (10,584) (10,491)
- -------------------------------------------------------------------------- -------- --------
Net investment income 253,979 252,174
- -------------------------------------------------------------------------- -------- --------
REALIZED AND UNREALIZED GAIN (LOSS) FROM:
Net realized gain (loss) from:
Investment securities 233,263 67,041
- -------------------------------------------------------------------------- -------- --------
Foreign currencies 114 --
- -------------------------------------------------------------------------- -------- --------
Futures contracts 170,459 (67,077)
========================================================================== ======== ========
403,836 (36)
========================================================================== ======== ========
Change in net unrealized appreciation (depreciation) of:
Investment securities (62,623) 132,336
- -------------------------------------------------------------------------- -------- --------
Futures contracts 62,810 4,912
========================================================================== ======== ========
187 137,248
========================================================================== ======== ========
Net realized and unrealized gain 404,023 137,212
========================================================================== ======== ========
Net increase in net assets resulting from operations $658,002 $389,386
========================================================================== ======== ========
</Table>
See accompanying Notes to Financial Statements which are an integral part of the
financial statements.
9 AIM CORE ALLOCATION PORTFOLIO SERIES
STATEMENT OF CHANGES IN NET ASSETS
For the six months ended February 29, 2008 and the year ended August 31, 2007
(Unaudited)
<Table>
<Caption>
SERIES C SERIES M
--------------------------- ---------------------------
FEBRUARY 29, AUGUST 31, FEBRUARY 29, AUGUST 31,
2008 2007 2008 2007
------------
OPERATIONS:
Net investment income $ 253,979 $ 773,944 $ 252,174 $ 721,440
- ------------------------------------------------------ --------------------------- ---------------------------
Net realized gain (loss) 403,836 278,083 (36) 68,098
- ------------------------------------------------------ --------------------------- ---------------------------
Change in net unrealized appreciation (depreciation) 187 (70,973) 137,248 (201,408)
====================================================== =========================== ===========================
Net increase in net assets resulting from
operations 658,002 981,054 389,386 588,130
====================================================== =========================== ===========================
Distributions to shareholders from net investment
income (294,888) (766,803) (241,738) (710,020)
====================================================== =========================== ===========================
Distributions to shareholders from net realized gains (86,377) -- -- --
====================================================== =========================== ===========================
Decrease in net assets resulting from
distributions (381,265) (766,803) (241,738) (710,020)
====================================================== =========================== ===========================
Share transactions-net: (3,726,340) (3,784,508) (3,681,198) (3,778,203)
====================================================== =========================== ===========================
Net increase (decrease) in net assets (3,449,603) (3,570,257) (3,533,550) (3,900,093)
====================================================== =========================== ===========================
NET ASSETS:
Beginning of period 11,152,045 14,722,302 11,104,042 15,004,135
====================================================== =========================== ===========================
End of period* $ 7,702,442 $11,152,045 $ 7,570,492 $11,104,042
====================================================== =========================== ===========================
* Includes accumulated undistributed net investment
income $ 6,375 $ 47,284 $ 28,511 $ 18,075
====================================================== =========================== ===========================
</Table>
See accompanying Notes to Financial Statements which are an integral part of the
financial statements.
10 AIM CORE ALLOCATION PORTFOLIO SERIES
STATEMENT OF CASH FLOWS
For the six months ended February 29, 2008
(Unaudited)
<Table>
<Caption>
SERIES C SERIES M
------------
CASH PROVIDED BY OPERATING ACTIVITIES:
Net increase in net assets resulting from operations $ 658,002 $ 389,386
======================================================================== ============ ===========
ADJUSTMENTS TO RECONCILE NET INCREASE (DECREASE) IN NET ASSETS FROM RESULTING FROM
OPERATIONS
TO NET CASH PROVIDED BY OPERATING ACTIVITIES:
Purchases of investments (19,482,432) (1,463,001)
- ------------------------------------------------------------------------ ------------ -----------
Net (purchases)/sales of short-term securities 103,848 63,598
- ------------------------------------------------------------------------ ------------ -----------
Net amortization of premium and (accretion of discount) on investment
securities 4,746 (2,425)
- ------------------------------------------------------------------------ ------------ -----------
Proceeds from disposition of investment securities and principal
payments 21,104,222 2,463,779
- ------------------------------------------------------------------------ ------------ -----------
Realized gain on investment securities (233,263) (67,041)
- ------------------------------------------------------------------------ ------------ -----------
Change in unrealized gain (loss) on investment securities 62,623 (132,336)
- ------------------------------------------------------------------------ ------------ -----------
Increase (decrease) in variation margin receivable (31,787) 6,328
- ------------------------------------------------------------------------ ------------ -----------
Increase (decrease) in variation margin payable 855 (1,359)
- ------------------------------------------------------------------------ ------------ -----------
Decrease in dividends and interest receivables 27,197 22,497
- ------------------------------------------------------------------------ ------------ -----------
Net cash provided by operating activities 2,214,011 1,279,426
======================================================================== ============ ===========
CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES:
Net cash activity from dollar rolls 1,507,253 2,219,637
- ------------------------------------------------------------------------ ------------ -----------
Proceeds from shares of beneficial interest sold 108,594 107,467
- ------------------------------------------------------------------------ ------------ -----------
Disbursements from shares of beneficial interest reacquired (3,854,193) (3,806,904)
- ------------------------------------------------------------------------ ------------ -----------
Dividends paid to shareholders (377,915) (252,612)
======================================================================== ============ ===========
Net cash provided by (used in) financing activities (2,616,261) (1,732,412)
======================================================================== ============ ===========
Net increase (decrease) in cash and cash equivalents (402,250) (452,986)
======================================================================== ============ ===========
Cash and cash equivalents at beginning of period 1,053,688 1,325,064
======================================================================== ============ ===========
Cash and cash equivalents at end of period $ 651,438 $ 872,078
======================================================================== ============ ===========
NON-CASH FINANCING ACTIVITIES:
Value of capital shares issued in reinvestment of dividends paid to
shareholders $ 3,350 $ 2,408
======================================================================== ============ ===========
</Table>
See accompanying Notes to Financial Statements which are an integral part of the
financial statements.
11 AIM CORE ALLOCATION PORTFOLIO SERIES
NOTES TO FINANCIAL STATEMENTS
February 29, 2008
(Unaudited)
NOTE 1--SIGNIFICANT ACCOUNTING POLICIES
AIM Core Allocation Portfolio Series (the "Trust") is a Delaware statutory trust
registered under the Investment Company Act of 1940, as amended (the "1940
Act"), as an open-end series management investment company consisting of two
separate portfolios (each constituting a "Fund"). The Funds covered in this
report are Series C and Series M (collectively, the "Funds"). Each Fund is
authorized to issue an unlimited number of shares of beneficial interest.
Matters affecting each Fund or class will be voted on exclusively by the
shareholders of such portfolio or class. The assets, liabilities and operations
of each portfolio are accounted for separately. Information presented in these
financial statements pertains only to the Fund. Each Fund is available
exclusively through separately managed accounts, the investments of which are
allocated principally to fixed income investments and that are advised or sub-
advised by Invesco Aim Advisors, Inc. ("the Advisor or Invesco Aim") or its
affiliates. Clients, who are indirect Fund shareholders and invest in these
separately managed accounts, pay a wrap or similar management fee to participate
in such accounts.
The Funds' investment objective is a high total return consistent with
preservation of capital.
The following is a summary of the significant accounting policies followed by
the Funds in the preparation of their financial statements.
A. SECURITY VALUATIONS -- Securities, including restricted securities, are
valued according to the following policy.
Debt obligations (including convertible bonds) and unlisted equities are
fair valued using an evaluated quote provided by an independent pricing
service. Evaluated quotes provided by the pricing service may be
determined without exclusive reliance on quoted prices, and may reflect
appropriate factors such as institution-size trading in similar groups of
securities, developments related to specific securities, dividend rate,
yield, quality, type of issue, coupon rate, maturity, individual trading
characteristics and other market data. Short-term obligations, including
commercial paper, having 60 days or less to maturity are recorded at
amortized cost which approximates value. Debt securities are subject to
interest rate and credit risks. In addition, all debt securities involve
some risk of default with respect to interest and/or principal payments.
A security listed or traded on an exchange (except convertible bonds) is
valued at its last sales price or official closing price as of the close
of the customary trading session on the exchange where the security is
principally traded, or lacking any sales or official closing price on a
particular day, the security may be valued at the closing bid price on
that day. Securities traded in the over-the-counter market are valued
based on prices furnished by independent pricing services or market
makers. When such securities are valued by an independent pricing service
they may be considered fair valued. Futures contracts are valued at the
final settlement price set by an exchange on which they are principally
traded. Listed options are valued at the mean between the last bid and the
ask prices from the exchange on which they are principally traded. Options
not listed on an exchange are valued by an independent source at the mean
between the last bid and ask prices. For purposes of determining net asset
value per share, futures and option contracts generally are valued 15
minutes after the close of the customary trading session of the New York
Stock Exchange ("NYSE").
Investments in open-end and closed-end registered investment companies
that do not trade on an exchange are valued at the end of day net asset
value per share. Investments in open-end and closed-end registered
investment companies that trade on an exchange are valued at the last
sales price or official closing price as of the close of the customary
trading session on the exchange where the security is principally traded.
Swap agreements are fair valued using an evaluated quote provided by an
independent pricing service. Evaluated quotes provided by the pricing
service are valued based on a model which may include end of day net
present values, spreads, ratings, industry, and company performance.
Foreign securities (including foreign exchange contracts) are converted
into U.S. dollar amounts using the applicable exchange rates as of the
close of the NYSE. If market quotations are available and reliable for
foreign exchange traded equity securities, the securities will be valued
at the market quotations. Because trading hours for certain foreign
securities end before the close of the NYSE, closing market quotations may
become unreliable. If between the time trading ends on a particular
security and the close of the customary trading session on the NYSE,
events occur that are significant and may make the closing price
unreliable, the Fund may fair value the security. If the event is likely
to have affected the closing price of the security, the security will be
valued at fair value in good faith using procedures approved by the Board
of Trustees. Adjustments to closing prices to reflect fair value may also
be based on a screening process of an independent pricing service to
indicate the degree of certainty, based on historical data, that the
closing price in the principal market where a foreign security trades is
not the current value as of the close of the NYSE. Foreign securities
meeting the approved degree of certainty that the price is not reflective
of current value will be priced at the indication of fair value from the
independent pricing service. Multiple factors may be considered by the
independent pricing service in determining adjustments to reflect fair
value and may include information relating to sector indices, ADRs and
domestic and foreign index futures. Foreign securities may have additional
risks including exchange rate changes, potential for sharply devalued
currencies and high inflation, political and economical upheaval, the
relative lack of issuer information, relatively low market liquidity and
the potential lack of strict financial and accounting controls and
standards.
Securities for which market prices are not provided by any of the above
methods may be valued based upon quotes furnished by independent sources
and are valued at the last bid price in the case of equity securities and
in the case of debt obligations, the mean between the last bid and asked
prices.
Securities for which market quotations are not readily available or are
unreliable are valued at fair value as determined in good faith by or
under the supervision of the Trust's officers following procedures
approved by the Board of Trustees. Issuer specific events, market trends,
bid/ask quotes of brokers and information providers and other market data
may be reviewed in the course of making a good faith determination of a
security's fair value.
Valuations change in response to many factors including the historical
and prospective earnings of the issuer, the value of the issuer's assets,
general economic conditions, interest rates, investor perceptions and
market liquidity.
12 AIM CORE ALLOCATION PORTFOLIO SERIES
B. SECURITIES TRANSACTIONS AND INVESTMENT INCOME -- Securities transactions
are accounted for on a trade date basis. Realized gains or losses on sales
are computed on the basis of specific identification of the securities
sold. Interest income is recorded on the accrual basis from settlement
date. Dividend income is recorded on the ex-dividend date. Bond premiums
and discounts are amortized and/or accreted for financial reporting
purposes.
The Funds may periodically participate in litigation related to Fund
investments. As such, the Funds may receive proceeds from litigation
settlements. Any proceeds as received are included in the Statement of
Operations as realized gain/loss for investments no longer held and as
unrealized gain/loss for investments still held.
Brokerage commissions and mark ups are considered transaction costs and
are recorded as an increase to the cost basis of securities purchased
and/or a reduction of proceeds on a sale of securities. Such transaction
costs are included in the determination of realized and unrealized gain
(loss) from investment securities reported in the Statement of Operations
and the Statement of Changes in Net Assets and the realized and unrealized
net gains (losses) on securities per share in the Financial Highlights.
Transaction costs are included in the calculation of such Fund's net asset
value and, accordingly, they reduce the Fund's total returns. These
transaction costs are not considered operating expenses and are not
reflected in net investment income reported in the Statement of Operations
and Statement of Changes in Net Assets, or the net investment income per
share and ratios of expenses and net investment income reported in the
Financial Highlights, nor are they limited by any expense limitation
arrangements between each Fund and the advisor.
C. COUNTRY DETERMINATION -- For the purposes of making investment selection
decisions and presentation in the Schedule of Investments, Invesco Aim may
determine the country in which an issuer is located and/or credit risk
exposure based on various factors. These factors include the laws of the
country under which the issuer is organized, where the issuer maintains a
principal office, the country in which the issuer derives 50% or more of
its total revenues and the country that has the primary market for the
issuer's securities, as well as other criteria. Among the other criteria
that may be evaluated for making this determination are the country in
which the issuer maintains 50% or more of its assets, the type of
security, financial guarantees and enhancements, the nature of the
collateral and the sponsor organization. Country of issuer and/or credit
risk exposure has been determined to be the United States of America
unless otherwise noted.
D. DISTRIBUTIONS -- Generally, Series C declares dividends monthly and Series
M declares dividends daily, if any. The Funds generally pay declared
dividends monthly. Distributions from net realized capital gain, if any,
are generally paid annually and recorded on ex-dividend date. The Funds
may elect to treat a portion of the proceeds from redemptions as
distributions for federal income tax purposes.
E. FEDERAL INCOME TAXES -- The Funds intend to comply with the requirements
of Subchapter M of the Internal Revenue Code necessary to qualify as a
regulated investment company and to distribute substantially all of the
Funds' taxable earnings to shareholders. As such, the Funds will not be
subject to federal income taxes on otherwise taxable income (including net
realized capital gain) that is distributed to shareholders. Therefore, no
provision for federal income taxes is recorded in the financial
statements.
F. ACCOUNTING ESTIMATES -- The preparation of financial statements in
conformity with accounting principles generally accepted in the United
States of America requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period including estimates and assumptions related to
taxation. Actual results could differ from those estimates.
G. INDEMNIFICATIONS -- Under the Trust's organizational documents, each
Trustee, officer, employee or other agent of the Trust (including the
Trust's investment manager) is indemnified against certain liabilities
that may arise out of performance of their duties to the Funds.
Additionally, in the normal course of business, the Funds enter into
contracts that contain a variety of indemnification clauses. Each Fund's
maximum exposure under these arrangements is unknown as this would involve
future claims that may be made against such Fund that have not yet
occurred. The risk of material loss as a result of such indemnification
claims is considered remote.
H. CASH AND CASH EQUIVALENTS -- For the purposes of the Statement of Cash
Flows the Funds define Cash and Cash Equivalents as cash (including
foreign currency), money market funds and other investments held in lieu
of cash and excludes investments made with cash collateral received.
I. DOLLAR ROLL AND FORWARD COMMITMENT TRANSACTIONS -- The Fund may engage in
dollar roll and forward commitment transactions with respect to mortgage-
backed securities issued by GNMA, FNMA and FHLMC. These transactions are
often conducted on a to be announced ("TBA") basis. In a TBA mortgage-
backed transaction, the seller does not specify the particular securities
to be delivered. Rather, a Fund agrees to accept any security that meets
specified terms, such as an agreed upon issuer, coupon rate and terms of
the underlying mortgages. TBA mortgage-backed transactions generally
settle once a month on a specific date.
In a dollar roll transaction, the Fund sells a mortgage-backed security
held in the Fund to a financial institution such as a bank or broker-
dealer, and simultaneously agrees to purchase a substantially similar
security (same type, coupon and maturity) from the institution at an
agreed upon price and future date. The mortgage-backed securities to be
purchased will bear the same coupon as those sold, but generally will be
collateralized by different pools of mortgages with different prepayment
histories. Based on the typical structure of dollar roll transactions by
the Fund, the dollar roll transactions are accounted for as financing
transactions in which the Fund receives compensation as either a "fee" or
a "drop". "Fee" income which is agreed upon amongst the parties at the
commencement of the dollar roll and the "drop" which is the difference
between the selling price and the repurchase price of the mortgage-backed
securities are amortized to income. During the period between the sale and
purchase settlement dates, the Fund will not be entitled to receive
interest and principal payments on securities purchased and not yet
settled. Proceeds of the sale may be invested in short-term instruments,
and the income from these investments, together with any additional fee
income received on the sale, could generate income for the Fund exceeding
the yield on the security sold. Dollar roll transactions are considered
borrowings under the 1940 Act.
Forward commitment transactions involve commitments by the Fund to
acquire or sell TBA mortgage-backed securities from a financial
institution, such as a bank or broker-dealer at a specified future date
and amount. The TBA mortgage-backed security is marked to market until
settlement and the unrealized appreciation or depreciation is recorded in
the statement of operations.
13 AIM CORE ALLOCATION PORTFOLIO SERIES
At the time the Fund enters into the dollar roll or forward commitment
transaction, mortgage-backed securities or other liquid assets held by the
Fund having a dollar value equal to the purchase price or in an amount
sufficient to honor the forward commitment will be segregated.
Dollar roll transactions involve the risk that the market value of the
securities retained by the Fund may decline below the price of the
securities that the Fund has sold but is obligated to purchase under the
agreement. In the event that the buyer of securities in a dollar roll
transaction files for bankruptcy or becomes insolvent, the Fund's use of
the proceeds from the sale of the securities may be restricted pending a
determination by the other party, or its trustee or receiver, whether to
enforce the Fund's obligation to purchase the securities. The return
earned by the Fund with the proceeds of the dollar roll transaction may
not exceed the return on the securities sold.
Forward commitment transactions involve the risk that a counter-party to
the transaction may fail to complete the transaction. If this occurs, the
Fund may lose the opportunity to purchase or sale the security at the
agreed upon price. Settlement dates of forward commitment transactions may
be a month or more after entering into these transactions and as a result
the market values of the securities may vary from the purchase or sale
prices. Therefore, forward commitment transactions may increase the Fund's
overall interest rate exposure.
J. FOREIGN CURRENCY TRANSLATIONS -- Foreign currency is valued at the close
of the NYSE based on quotations posted by banks and major currency
dealers. Portfolio securities and other assets and liabilities denominated
in foreign currencies are translated into U.S. dollar amounts at date of
valuation. Purchases and sales of portfolio securities (net of foreign
taxes withheld on disposition) and income items denominated in foreign
currencies are translated into U.S. dollar amounts on the respective dates
of such transactions. Each Fund does not separately account for the
portion of the results of operations resulting from changes in foreign
exchange rates on investments and the fluctuations arising from changes in
market prices of securities held. The combined results of changes in
foreign exchange rates and the fluctuation of market prices on investments
(net of estimated foreign tax withholding) are included with the net
realized and unrealized gain or loss from investments in the Statement of
Operations. Reported net realized foreign currency gains or losses arise
from (i) sales of foreign currencies, (ii) currency gains or losses
realized between the trade and settlement dates on securities
transactions, and (iii) the difference between the amounts of dividends,
interest, and foreign withholding taxes recorded on the Fund's books and
the U.S. dollar equivalent of the amounts actually received or paid. Net
unrealized foreign currency gains and losses arise from changes in the
fair values of assets and liabilities, other than investments in
securities at fiscal period end, resulting from changes in exchange rates.
Each Fund may invest in foreign securities which may be subject to
foreign taxes on income, gains on investments or currency repatriation, a
portion of which may be recoverable. Taxes are accrued based on such
Fund's current interpretation of tax regulations and rates that exist in
the foreign markets in which the Fund invests.
K. FOREIGN CURRENCY CONTRACTS -- A foreign currency contract is an obligation
to purchase or sell a specific currency for an agreed-upon price at a
future date. The Funds may enter into a foreign currency contract to
attempt to minimize the risk to the Funds from adverse changes in the
relationship between currencies. The Funds may also enter into a foreign
currency contract for the purchase or sale of a security denominated in a
foreign currency in order to "lock in" the U.S. dollar price of that
security. Fluctuations in the value of these contracts are recorded as
unrealized appreciation (depreciation) until the contracts are closed.
When these contracts are closed, realized gains (losses) are recorded.
Realized and unrealized gains and losses on these contracts are included
in the Statement of Operations. The Funds could be exposed to risk, which
may be in excess of the amount reflected in the Statement of Assets and
Liabilities, if counterparties to the contracts are unable to meet the
terms of their contracts or if the value of the foreign currency changes
unfavorably.
L. FUTURES CONTRACTS -- The Funds may purchase or sell futures contracts.
Initial margin deposits required upon entering into futures contracts are
satisfied by the segregation of specific securities as collateral for the
account of the broker (the Funds' agent in acquiring the futures
position). During the period the futures contracts are open, changes in
the value of the contracts are recognized as unrealized gains or losses by
"marking to market" on a daily basis to reflect the market value of the
contracts at the end of each day's trading. Variation margin payments are
received or made depending upon whether unrealized gains or losses are
incurred. When the contracts are closed, each Fund recognizes a realized
gain or loss equal to the difference between the proceeds from, or cost
of, the closing transaction and the such Fund's basis in the contract. If
such Fund was unable to liquidate a futures contract and/or enter into an
offsetting closing transaction, the Fund would continue to be subject to
market risk with respect to the value of the contracts and continue to be
required to maintain the margin deposits on the futures contracts. Risks
may exceed amounts recognized in the Statement of Assets and Liabilities.
M. COLLATERAL -- To the extent each Fund has pledged or segregated a security
as collateral and that security is subsequently sold, it is such Fund's
practice to replace such collateral no later than the next business day.
NOTE 2--ADVISORY FEES AND OTHER FEES PAID TO AFFILIATES
The Trust has entered into a master investment management agreement with Invesco
Aim pursuant to which Invesco Aim provides all management and advisory services
necessary for the operation of each Fund. Invesco Aim benefits from the Funds
being an investment option in wrap fee and certain other programs advised or
sub-advised by Invesco Aim or its affiliates. Invesco Aim and/or its affiliates
receive fees for advising or sub-advising such wrap programs. Under the terms of
the investment management agreement, each Fund pays an advisory fee to the
Advisor based on the annual rate equal to 0.23% of such Fund's average daily net
assets. However, the Advisor has agreed irrevocably to waive all fees and pay
all expenses incurred by the Funds in connection with their operations, except
for (i) all brokers' commissions, issue and transfer taxes, foreign taxes and
other costs chargeable to the Trust or each Fund in connection with securities
transactions to which the Trust or such Fund are a party or in connection with
securities owned by the Trust or such Fund; (ii) costs, including interest
expense, of borrowing money; and (iii) extraordinary items such as litigation
costs authorized by the Board of Trustees.
Under the terms of a master sub-advisory agreement between Invesco Aim and
Invesco Institutional (N.A.), Inc., Invesco Aim pays Invesco 0.11% of each
Fund's average daily net assets.
Under the terms of a master sub-advisory agreement approved by shareholders of
the Funds on March 28, 2008, to be effective as of May 1, 2008, between the
Advisor and each of Invesco Asset Management Deutschland GmbH, Invesco Asset
Management Limited, Invesco Asset Management (Japan) Limited, Invesco Australia
Limited, Invesco Global Asset Management (N.A.), Inc., Invesco Hong Kong
Limited, Invesco Institutional (N.A.), Inc., Invesco Senior
14 AIM CORE ALLOCATION PORTFOLIO SERIES
Secured Management, Inc. and AIM Funds Management Inc. (collectively, the
"Affiliated Sub-Advisors") the Advisor, not the Funds, may pay an amount equal
to 0.11% of net assets to any such Affiliated Sub-Advisor(s) that provide
discretionary investment management services to each Fund based on the
percentage of assets allocated to such Sub-Advisor(s).
For the six months ended February 29, 2008, the Advisor waived the following
advisory fees:
<Table>
<Caption>
Series C $10,584
- ------------------------------------------------------------------
Series M 10,491
__________________________________________________________________
==================================================================
</Table>
The Trust has entered into a master administrative services agreement with
Invesco Aim whereby Invesco Aim provides accounting, shareholder and other
administrative services to each Fund. Invesco Aim does not charge the Funds any
fees under the administrative services agreement. The Trust has also entered
into a transfer agency and service agreement with Invesco Aim and Invesco Aim
Investment Services, Inc. ("IAIS") whereby IAIS provides transfer agency and
shareholder services to each Fund. The Funds are not charged any fees pursuant
to such agreement.
The Trust has entered into a master distribution agreement with Invesco Aim
Distributors, Inc. ("IADI") to serve as the distributor for shares of each Fund.
The Funds are not charged any fees pursuant to the distribution agreement with
IADI.
Certain officers and trustees of the Trust are officers and directors of
Invesco Aim, IAIS and/or IADI.
NOTE 3--TRUSTEES' AND OFFICER'S FEES AND BENEFITS
Remuneration is paid to certain Trustees and Officers of the Trust. Trustees
have the option to defer their compensation. Those Trustees who defer
compensation have the option to select various AIM Funds in which their deferral
accounts shall be deemed to be invested.
Certain current Trustees are eligible to participate in a retirement plan that
provides for benefits to be paid upon retirement to Trustees over a period of
time based on the number of years of service. The Funds may have certain former
Trustees that also participate in a retirement plan and receive benefits under
such plan. Each Fund's allocable portion of the remuneration paid to the
Trustees, including its allocable portion of the fees and benefits of the
deferred compensation plan and retirement plan are paid by Invesco Aim and not
by the Trust.
NOTE 4--BORROWINGS
The Funds may borrow for leveraging in an amount up to 5% of each Fund's total
assets (excluding the amount borrowed) at the time the borrowing is made. In
doing so, the Funds are permitted to temporarily carry a negative or overdrawn
balance in its account with The State Street Bank and Trust Company ("SSB"), the
custodian bank. To compensate the custodian bank for such overdrafts, the
overdrawn Fund may either (i) leave funds as a compensating balance in the
account so the custodian bank can be compensated by earning the additional
interest; or (ii) compensate by paying the custodian bank at a rate agreed upon
by the custodian bank and Invesco Aim, not to exceed the contractually agreed
upon rate. The Funds may not purchase additional securities when any borrowings
from banks exceeds 5% of each Fund's total assets.
Additionally, the Funds are a party to an uncommitted unsecured revolving
credit facility with SSB. Each Fund may borrow up to the lesser of (i)
$125,000,000, or (ii) the limits set by its prospectus for borrowings. The Funds
and other funds advised by Invesco Aim, which are parties to the credit
facility, can borrow on a first come, first served basis. Principal on each loan
outstanding shall bear interest at the bid rate quoted by SSB at the time of the
request for the loan. During the six months ended February 29, 2008, the Funds
did not borrow under the uncommitted unsecured revolving credit facility.
NOTE 5--FUTURES CONTRACTS
SERIES C
On February 29, 2008, U.S. Government Sponsored Agency obligations with a
value of $59,742 were pledged as collateral to cover margin requirements for
open futures contracts.
<Table>
<Caption>
OPEN FUTURES CONTRACTS AT PERIOD END
- ------------------------------------------------------------------------------------------------------------
NUMBER OF MONTH/ VALUE UNREALIZED
CONTRACT CONTRACTS COMMITMENT 02/29/08 APPRECIATION
- ------------------------------------------------------------------------------------------------------------
U.S. Treasury 5 Year Notes 14 June-2008/Long $ 1,599,500 $ 30,704
- ------------------------------------------------------------------------------------------------------------
U.S. Treasury 10 Year Bonds 4 June-2008/Long 469,125 11,944
============================================================================================================
$ 2,068,625 $ 42,648
____________________________________________________________________________________________________________
============================================================================================================
</Table>
15 AIM CORE ALLOCATION PORTFOLIO SERIES
SERIES M
On February 29, 2008, U.S. Government Sponsored Agency obligations with a value
of $39,828 were pledged as collateral to cover margin requirements for open
futures contracts.
<Table>
<Caption>
OPEN FUTURES CONTRACTS AT PERIOD END
- -----------------------------------------------------------------------------------------------------------------------
UNREALIZED
NUMBER OF MONTH/ VALUE APPRECIATION
CONTRACT CONTRACTS COMMITMENT 02/29/08 (DEPRECIATION)
- -----------------------------------------------------------------------------------------------------------------------
U.S. Treasury 10 Year Bonds 3 June-2008/Long $ 351,844 $ 8,962
- -----------------------------------------------------------------------------------------------------------------------
U.S. Treasury 30 Year Bonds 3 March-2008/Short (359,063) (7,430)
=======================================================================================================================
$ (7,219) $ 1,532
_______________________________________________________________________________________________________________________
=======================================================================================================================
</Table>
NOTE 6--TAX INFORMATION
The amount and character of income and gains to be distributed are determined in
accordance with income tax regulations, which may differ from generally accepted
accounting principles. Reclassifications are made to each Fund's capital
accounts to reflect income and gains available for distribution (or available
capital loss carryforward) under income tax regulations. The tax character of
distributions paid during the year and the tax components of net assets will be
reported at the Funds' fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date.
Results of transactions and other activity after that date may affect the amount
of capital loss carryforward actually available for the Funds to utilize. The
ability to utilize capital loss carryforward in the future may be limited under
the Internal Revenue Code and related regulations based on the results of future
transactions.
The Funds had a capital loss carryforward as of August 31, 2007 which expire
as follows:
<Table>
<Caption>
CAPITAL LOSS CARRYFORWARD*
--------------------------------------
AUGUST 31, AUGUST 31,
2014 2015 TOTAL
- ---------------------------------------------------------------------------------------------------------
Series C $136,362 $ -- $136,362
- ---------------------------------------------------------------------------------------------------------
Series M 144,346 4,167 148,513
_________________________________________________________________________________________________________
=========================================================================================================
</Table>
* Capital loss carryforward as of the date listed above is reduced for
limitations, if any, to the extent required by the Internal Revenue Code.
NOTE 7--INVESTMENT SECURITIES
During the six months ended February 29, 2008 purchases and sales of investments
(excluding short-term investments) were as follows:
<Table>
<Caption>
PURCHASES SALES
(EXCLUDING (EXCLUDING PURCHASES OF
U.S. TREASURY SECURITIES) U.S. TREASURY SECURITIES) U.S. TREASURY SECURITIES
- ----------------------------------------------------------------------------------------------------------------
Series C $13,046,568 $(12,432,266) $6,152,971
- ----------------------------------------------------------------------------------------------------------------
Series M 251,360 (2,879,342) 369,035
________________________________________________________________________________________________________________
================================================================================================================
<Caption>
SALES OF
U.S. TREASURY SECURITIES
- ----------------------------------------------------
Series C $(9,151,903)
- ----------------------------------------------------
Series M (817,474)
____________________________________________________
====================================================
</Table>
At February 29, 2008, the aggregate cost and the net unrealized appreciation
(depreciation) of investments for tax purposes are as follows:
<Table>
<Caption>
FEDERAL TAX COST UNREALIZED APPRECIATION UNREALIZED (DEPRECIATION)
- --------------------------------------------------------------------------------------------------------
Series C $9,124,019 $152,187 $(145,259)
- --------------------------------------------------------------------------------------------------------
Series M 9,886,435 311,298 (120,107)
________________________________________________________________________________________________________
========================================================================================================
<Caption>
NET UNREALIZED APPRECIATION
- ---------------------------------------------------------
Series C $ 6,928
- ---------------------------------------------------------
Series M 191,191
_________________________________________________________
=========================================================
</Table>
Cost of investments on a tax basis includes the adjustments for financial
reporting purposes as of the most recently completed Federal income tax
reporting period end.
NOTE 8--SHARE INFORMATION
Each Fund currently offers one class of shares.
SERIES C
<Table>
<Caption>
CHANGES IN SHARES OUTSTANDING
- -------------------------------------------------------------------------------------------------------------------
SIX MONTHS ENDED YEAR ENDED
FEBRUARY 29, 2008(a) AUGUST 31, 2007
------------------------ ------------------------
SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------------------------------------------------------------------------
Sold 10,803 $ 108,594 114,035 $ 1,122,059
- -------------------------------------------------------------------------------------------------------------------
Issued as reinvestment of dividends 340 3,350 431 4,251
- -------------------------------------------------------------------------------------------------------------------
Reacquired (382,869) (3,838,284) (497,023) (4,910,818)
===================================================================================================================
(371,726) $(3,726,340) (382,557) $(3,784,508)
___________________________________________________________________________________________________________________
===================================================================================================================
</Table>
16 AIM CORE ALLOCATION PORTFOLIO SERIES
SERIES M
<Table>
<Caption>
CHANGES IN SHARES OUTSTANDING
- -------------------------------------------------------------------------------------------------------------------
SIX MONTHS ENDED YEAR ENDED
FEBRUARY 29, 2008(a) AUGUST 31, 2007
------------------------ ------------------------
SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------------------------------------------------------------------------
Sold 10,883 $ 107,467 114,455 $ 1,127,461
- -------------------------------------------------------------------------------------------------------------------
Issued as reinvestment of dividends 244 2,408 466 4,589
- -------------------------------------------------------------------------------------------------------------------
Reacquired (384,153) (3,791,073) (499,088) (4,910,253)
===================================================================================================================
(373,026) $(3,681,198) (384,167) $(3,778,203)
___________________________________________________________________________________________________________________
===================================================================================================================
</Table>
(a) There is an entity that is a record owner of more than 5% of the
outstanding shares of the Funds and that owns 99% of the outstanding shares
of the Funds. IADI has an agreement with this entity to sell Fund shares.
The Funds, Invesco Aim and/or Invesco Aim affiliates may make payments to
this entity, which is considered to be related to the Funds, for providing
services to the Funds, Invesco Aim and/or Invesco Aim affiliates including
but not limited to services such as, securities brokerage, distribution,
third party record keeping and account servicing. The Trust has no
knowledge as to whether all or any portion of the shares owned of record by
this entity are owned beneficially.
17 AIM CORE ALLOCATION PORTFOLIO SERIES
NOTE 9--FINANCIAL HIGHLIGHTS--SERIES C
The following schedule presents financial highlights for a share of the Fund
outstanding throughout the periods indicated.
<Table>
<Caption>
DECEMBER 30, 2005
SIX MONTHS ENDED YEAR ENDED (COMMENCEMENT DATE)
FEBRUARY 29, AUGUST 31, TO AUGUST 31,
2008 2007 2006
- -------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 9.85 $ 9.72 $ 10.00
- -------------------------------------------------------------------------------------------------------------
Income from investment operations:
Net investment income 0.29 0.57 0.37
- -------------------------------------------------------------------------------------------------------------
Net gains (losses) on securities (both realized
and unrealized) 0.41 0.12 (0.37)
- -------------------------------------------------------------------------------------------------------------
Net gain from investment error -- -- 0.05
=============================================================================================================
Total from investment operations 0.70 0.69 0.05
=============================================================================================================
Less distributions:
Dividends from net investment income (0.32) (0.56) (0.33)
- -------------------------------------------------------------------------------------------------------------
Distributions from net realized gains (0.10) -- --
=============================================================================================================
Total distributions (0.42) (0.56) (0.33)
=============================================================================================================
Net asset value, end of period $10.13 $ 9.85 $ 9.72
_____________________________________________________________________________________________________________
=============================================================================================================
Total return(a) 7.32% 7.25% 0.58%(b)
_____________________________________________________________________________________________________________
=============================================================================================================
Ratios/supplemental data:
Net assets, end of period (000s omitted) $7,702 $11,152 $14,722
_____________________________________________________________________________________________________________
=============================================================================================================
Ratio of expenses to average net assets:
With fee waivers 0.00%(c) 0.00% 0.00%(d)
- -------------------------------------------------------------------------------------------------------------
Without fee waivers 0.23%(c) 0.23% 0.23%(d)
=============================================================================================================
Ratio of net investment income to average net
assets 5.52%(c) 5.78% 5.89%(d)
_____________________________________________________________________________________________________________
=============================================================================================================
Portfolio turnover rate(e) 231% 420% 482%
_____________________________________________________________________________________________________________
=============================================================================================================
</Table>
(a) Includes adjustments in accordance with accounting principles generally
accepted in the United States of America and as such, the net asset value
for financial reporting purposes and the returns based upon those net asset
values may differ from the net asset value and returns for shareholder
transactions. Total returns are not annualized for periods less than one
year and do not reflect charges assessed in connection with a wrap product,
which if included would reduce total returns.
(b) Total return includes net gain from investment error. Total return
excluding net gain from investment error was 0.07%.
(c) Ratios are annualized and based on average daily net assets of $9,254,435.
(d) Annualized.
(e) Portfolio turnover is calculated at the fund level and is not annualized
for periods less than one year.
NOTE 9--FINANCIAL HIGHLIGHTS--SERIES M
The following schedule presents financial highlights for a share of the Fund
outstanding throughout the periods indicated.
<Table>
<Caption>
DECEMBER 30, 2005
SIX MONTHS ENDED YEAR ENDED (COMMENCEMENT DATE)
FEBRUARY 29, AUGUST 31, TO AUGUST 31,
2008 2007 2006
- -------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 9.76 $ 9.86 $ 10.00
- -------------------------------------------------------------------------------------------------------------
Income from investment operations:
Net investment income 0.28 0.53 0.35
- -------------------------------------------------------------------------------------------------------------
Net gains (losses) on securities (both realized
and unrealized) 0.12 (0.11) (0.18)
=============================================================================================================
Total from investment operations 0.40 0.42 0.17
=============================================================================================================
Less dividends from net investment income (0.26) (0.52) (0.31)
=============================================================================================================
Net asset value, end of period $ 9.90 $ 9.76 $ 9.86
_____________________________________________________________________________________________________________
=============================================================================================================
Total return(a) 4.13% 4.30% 1.77%
_____________________________________________________________________________________________________________
=============================================================================================================
Ratios/supplemental data:
Net assets, end of period (000s omitted) $7,570 $11,104 $15,004
_____________________________________________________________________________________________________________
=============================================================================================================
Ratio of expenses to average net assets:
With fee waivers 0.00%(b) 0.00% 0.00%(c)
- -------------------------------------------------------------------------------------------------------------
Without fee waivers 0.23%(b) 0.23% 0.23%(c)
=============================================================================================================
Ratio of net investment income to average net
assets 5.53%(b) 5.36% 5.62%(c)
_____________________________________________________________________________________________________________
=============================================================================================================
Portfolio turnover rate(d) 8% 46% 295%
_____________________________________________________________________________________________________________
=============================================================================================================
</Table>
(a) Includes adjustments in accordance with accounting principles generally
accepted in the United States of America and as such, the net asset value
for financial reporting purposes and the returns based upon those net asset
values may differ from the net asset value and returns for shareholder
transactions. Total returns are not annualized for periods less than one
year and do not reflect charges assessed in connection with a wrap product,
which if included would reduce total returns.
(b) Ratios are annualized and based on average daily net assets of $9,172,320.
(c) Annualized.
(d) Portfolio turnover is calculated at the fund level and is not annualized
for periods less than one year.
18 AIM CORE ALLOCATION PORTFOLIO SERIES
NOTE 10--LEGAL PROCEEDINGS
Terms used in the Legal Proceedings Note are defined terms solely for the
purpose of this note.
PENDING LITIGATION
On August 30, 2005, the West Virginia Office of the State Auditor -- Securities
Commission ("WVASC") issued a Summary Order to Cease and Desist and Notice of
Right to Hearing to Invesco Aim and IADI (Order No. 05-1318). The WVASC makes
findings of fact that Invesco Aim and IADI entered into certain arrangements
permitting market timing of the AIM Funds and failed to disclose these
arrangements in the prospectuses for such Funds, and conclusions of law to the
effect that Invesco Aim and IADI violated the West Virginia securities laws. The
WVASC orders Invesco Aim and IADI to cease any further violations and seeks to
impose monetary sanctions, including restitution to affected investors,
disgorgement of fees, reimbursement of investigatory, administrative and legal
costs and an "administrative assessment," to be determined by the Commissioner.
Initial research indicates that these damages could be limited or capped by
statute. By agreement with the Commissioner of Securities, Invesco Aim's time to
respond to that Order has been indefinitely suspended.
At the present time, management of Invesco Aim and the Fund are unable to
estimate the impact, if any, that the outcome of the Pending Litigation
described above may have on Invesco Aim, IADI or the Fund.
19 AIM CORE ALLOCATION PORTFOLIO SERIES
NOTE 10--LEGAL PROCEEDINGS--(CONTINUED)
CALCULATING YOUR ONGOING FUND EXPENSES
EXAMPLE
As a shareholder of the Funds, you incur ongoing costs, including management
fees; and other Fund expenses, if any. However, Invesco Aim Advisors, Inc.
("Invesco Aim"), the Funds' advisor, has agreed to irrevocably waive all fees
and pay all operating expenses, except extraordinary expenses, incurred by the
Funds. This example is intended to help you understand your ongoing costs (in
dollars) of investing in the Fund and to compare these costs with ongoing costs
of investing in other mutual funds. The example is based on an investment of
$1,000 invested at the beginning of the period and held for the entire period
September 1, 2007, through February 29, 2008.
ACTUAL EXPENSES
The table below provides information about actual account values and actual
expenses. You may use the information in this table, 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 table
under the heading entitled "Actual Expenses Paid During Period" to estimate the
expenses you paid on your account during this period.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The table below also provides information about hypothetical account values and
hypothetical expenses based on the Fund's actual expense ratio and an assumed
rate of return of 5% per year before expenses, which is not the Fund's actual
return.
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 transaction costs, such as sales
charges (loads) on purchase payments, contingent deferred sales charges on
redemptions, and redemption fees, if any. Therefore, the hypothetical
information 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 transaction costs were included, your costs would have been higher.
<Table>
<Caption>
- --------------------------------------------------------------------------------------------------
HYPOTHETICAL
(5% ANNUAL RETURN BEFORE
ACTUAL EXPENSES)
------------------------------------------------------
BEGINNING ENDING EXPENSES ENDING EXPENSES ANNUALIZED
ACCOUNT VALUE ACCOUNT VALUE PAID DURING ACCOUNT VALUE PAID DURING EXPENSE
SERIES (09/01/07) (02/29/08)(1) PERIOD(2) (02/29/08) PERIOD(2) RATIO
- --------------------------------------------------------------------------------------------------
C $1,000.00 $1,073.20 $0.00 $1,024.86 $0.00 0.00%
- --------------------------------------------------------------------------------------------------
M 1,000.00 1,041.30 0.00 1,024.86 0.00 0.00
- --------------------------------------------------------------------------------------------------
</Table>
(1) The actual ending account value is based on the actual total return of the
Funds for the period September 1, 2007, through February 29, 2008, after
actual expenses and will differ from the hypothetical ending account value
which is based on the Fund's expense ratio and a hypothetical annual return
of 5% before expenses.
(2) Expenses are equal to each Fund's annualized expense ratio, as indicated
above, multiplied by the average account value over the period, multiplied
by 182/366 to reflect the most recent fiscal half year. Invesco Aim has
agreed to irrevocably waive all fees and pay all operating expenses, except
extraordinary expenses, incurred by the Fund.
20 AIM CORE ALLOCATION PORTFOLIO SERIES
FUND HOLDINGS AND PROXY VOTING INFORMATION
The Funds provide a complete list of their holdings four times in each fiscal
year, at the quarter-ends. For the second and fourth quarters, the lists appear
in the Funds' semiannual and annual reports to shareholders. For the first and
third quarters, the Funds file the lists with the Securities and Exchange
Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is
available on the SEC Web site at sec.gov. There shareholders can look up the
Funds' Forms N-Q. Copies of the Funds' Forms N-Q may be reviewed and copied at
the SEC Public Reference Room in Washington, D.C. You can obtain information on
the operation of the Public Reference Room, including information about
duplicating fee charges, by calling 202-942-8090 or 800-732-0330, or by
electronic request at the following e-mail address: publicinfo@sec.gov. The SEC
file numbers for the Funds are 811-21792 and 333-127335.
A description of the policies and procedures that the Funds use to determine how
to vote proxies relating to portfolio securities is available without charge,
upon request, from our Client Services department at 800-959-4246 or on the
Invesco Aim Web site, invescoaim.com. On the home page, scroll down and click on
Proxy Policy. The information is also available on the SEC Web site, sec.gov.
Information regarding how the Funds voted proxies related to their portfolio
securities during the 12 months ended June 30, 2007, is available at our Web
site. Go to invescoaim.com, access the About Us tab, click on Required Notices
and then click on Proxy Voting Activity. Next, select the Funds from the
drop-down menu. The information is also available on the SEC Web site, sec.gov.
Invesco Aim(SM) is a service mark of Invesco Aim Management Group, Inc. Invesco
Aim Advisors, Inc., Invesco Aim Capital Management, Inc., Invesco Aim Private
Asset Management, Inc. and Invesco PowerShares Capital Management LLC are the
investment advisors for the products and services represented by Invesco Aim;
they each provide investment advisory services to individual and institutional
clients and do not sell securities. Invesco Institutional (N.A.), Inc., Invesco
Senior Secured Management, Inc., Invesco Global Asset Management (N.A.), Inc.,
AIM Funds Management Inc. (DBA AIM Trimark Investments), Invesco Asset
Management (Japan) Ltd. and Invesco Hong Kong Ltd. are affiliated investment
advisors that serve as the subadvisor for some of the products and services
represented by Invesco Aim. AIM Funds Management Inc. anticipates changing its
name to Invesco Trimark Investment Management Inc. (DBA Invesco Trimark) on or
prior to Dec. 31, 2008. Invesco Aim Distributors, Inc. is the distributor for
the retail mutual funds, exchange-traded funds and U.S. institutional money
market funds represented by Invesco Aim. All entities are indirect, wholly owned
subsidiaries of Invesco Ltd.
[Invesco Aim LOGO]
- SERVICE MARK -
invescoaim.com PAMCAPS-SAR-1 Invesco Aim Distributors, Inc.
ITEM 2. CODE OF ETHICS.
There were no amendments to the Code of Ethics (the "Code") that
applies to the Registrant's Principal Executive Officer ("PEO") and
Principal Financial Officer ("PFO") during the period covered by the
report. The Registrant did not grant any waivers, including implicit
waivers, from any provisions of the Code to the PEO or PFO during the
period covered by this report.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. SCHEDULE OF INVESTMENTS.
Investments in securities of unaffiliated issuers is included as part
of the reports to stockholders filed under Item 1 of this Form.
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.
None.
ITEM 11. CONTROLS AND PROCEDURES.
(a) As of March 18, 2008, an evaluation was performed under the supervision and
with the participation of the officers of the Registrant, including the
Principal Executive Officer ("PEO") and Principal Financial Officer
("PFO"), to assess the effectiveness of the Registrant's disclosure
controls and procedures, as that term is defined in Rule 30a-3(c) under the
Investment Company Act of 1940 (the "Act"), as amended. Based on that
evaluation, the Registrant's officers, including the PEO and PFO, concluded
that, as of March 18, 2008, the Registrant's disclosure controls and
procedures were reasonably designed to ensure: (1) that information
required to be disclosed by the Registrant on Form N-CSR is
recorded, processed, summarized and reported within the time periods
specified by the rules and forms of the Securities and Exchange Commission;
and (2) that material information relating to the Registrant is made known
to the PEO and PFO as appropriate to allow timely decisions regarding
required disclosure.
(b) There have been no changes in the Registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the Act) that
occurred during the second fiscal quarter of the period covered by the
report that has materially affected, or is reasonably likely to materially
affect, the Registrant's internal control over financial reporting.
ITEM 12. EXHIBITS.
12(a)(1) Not applicable.
12(a)(2) Certifications of principal executive officer and principal financial
officer as required by Rule 30a-2(a) under the Investment Company Act
of 1940.
12(a)(3) Not applicable.
12(b) Certifications of principal executive officer and principal financial
officer as required by Rule 30a-2(b) under the Investment Company Act
of 1940.
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: AIM Core Allocation Portfolio Series
By: /s/ Philip A. Taylor
---------------------------------
Philip A. Taylor
Principal Executive Officer
Date: May 8, 2008
Pursuant to the requirements of the Securities and 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/ Philip A. Taylor
---------------------------------
Philip A. Taylor
Principal Executive Officer
Date: May 8, 2008
By: /s/ Sidney M. Dilgren
---------------------------------
Sidney M. Dilgren
Principal Financial Officer
Date: May 8, 2008
EXHIBIT INDEX
12(a)(1) Not applicable.
12(a)(2) Certifications of principal executive officer and principal financial
officer as required by Rule 30a-2(a) under the Investment Company Act
of 1940.
12(a)(3) Not applicable.
12(b) Certifications of principal executive officer and principal financial
officer as required by Rule 30a-2(b) under the Investment Company Act
of 1940.