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 811-09096
AmeriPrime Funds
(Exact name of registrant as specified in charter)
431 North Pennsylvania Street, Indianapolis, Indiana 46204
(Address of principal executive offices) (Zip code)
Timothy Ashburn, Unified Fund Services, Inc., 431 North Pennsylvania Street
Indianapolis, Indiana 46204
(Name and address of agent for service)
Registrant's telephone number, including area code: 317-917-7000
Date of fiscal year end: 06/30
Date of reporting period: 06/30/03
Form N-CSR is to be used by management investment companies to file reports
with the Commission not later than 10 days after the transmission to
stockholders of any report that is required to be transmitted to stockholders
under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1).
The Commission may use the information provided on Form N-CSR in its regulatory,
disclosure review, inspection and policymaking roles.
A registrant is required to disclose the information specified by Form
N-CSR, and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. 3507.
<page>
Item 1. Reports to Stockholders.
June 30, 2003
Dear Fellow Shareholders,
We are pleased to present our annual report for the fiscal year ending June
30, 2003. The report covers the 12-month performance of the IMS Capital Value
Fund and the performance of the IMS Strategic Allocation Fund since its
inception on November 5, 2002.
Once again, the IMS Capital Value Fund handily beat its benchmark, the
Russell Mid-Cap Value Index. These results have earned the Fund much national
acclaim. BusinessWeek magazine recently singled out the IMS Capital Value Fund
as one of the best funds in the country over the past five years in terms of
risk adjusted returns. In addition, the Wall Street Journal, the New York Times,
CBS MarketWatch and Dow Jones News Wires have all run pieces that have pointed
out the stellar performance of the IMS Capital Value Fund during the past 12
months *. Over that time, the IMS Capital Value Fund has increased in size from
$17.1 million to $31.4 million.
The success of the IMS Capital Value Fund enabled us to launch two new
offerings, the IMS Strategic Allocation Fund (IMSAX) and the IMS Strategic
Income Fund (IMSIX), which provide our shareholders greater diversification and
potential exposure to all of the major asset classes and investment styles.
The IMS Strategic Allocation Fund posted solid returns during the period.
The IMS Strategic Allocation Fund will typically be invested in a broadly
diversified portfolio of exchange-traded index funds (ETFs) which cover the
major asset classes and investment styles including large-cap value, mid-cap
value, small-cap value, large-cap growth, mid-cap growth, small-cap growth,
international, fixed income and real estate. In addition, the Fund may invest in
industry sector funds. If we believe the market is likely to decline, we have
the flexibility to invest defensively and hold up to 50% of the assets in bonds,
up to 25% in real estate investment trusts and up to 25% in cash equivalents.
The principals and employees of IMS Capital Management continue to invest a
significant portion of their assets in the IMS Family of Funds. We thank you for
the confidence and trust you have shown by investing with us.
Sincerely,
/s/ Carl W. Marker /s/ Arthur Nunes
Carl W. Marker Arthur G. Nunes, CFP
Portfolio Manager, Co-Portfolio Manager,
IMS Capital Value Fund IMS Strategic Allocation Fund
* References:
BusinessWeek, January 27, 2003, pg. 58
Wall Street Journal, June 27, 2003, pg. C12
New York Times, May 18, 2003, pg. BU7
CBS MarketWatch, May 21, 2003, Andrea Coombes
Dow Jones News Wires, June10, 2003, Roger Cheng
The prospectus should be read carefully before investing. To request a
prospectus for more complete information, including charges and expenses, call
toll free 1-800-934-5550. Past performance does not guarantee future results.
Shares when redeemed may be worth more or less than their original cost.
Distributed by Unified Financial Securities, Inc.,
431 North Pennsylvania Street
Indianapolis, IN 46204
Member NASD, SIPC.
<page>
Performance - IMS Capital Value Fund
The IMS Capital Value Fund beat its benchmark, the Russell Mid-Cap Value
Index over the past three, six, and twelve-month periods.
The IMS Capital Value Fund employs a fundamental value approach that
considers several momentum factors as well. Companies selected must be seasoned
and fit into at least one of our strategic focus areas. These areas include
entertainment/leisure, technology, communications, healthcare, financial
services, consolidating industries, defensive industries and consumer staples.
Momentum factors include positive earnings surprises, positive earnings
revisions, positive relative strength and positive developments within the
company's business.
Another factor is "seasoning" which requires some patience. We have found
that a company that has suffered a drastic loss in market value requires at
least 18 to 24 months to rectify the situation and start outperforming the
market. For example, the Fund's largest holding, Marvel Enterprises, generated
many popular cartoon characters, but it did not have proper licensing
arrangements in place. New management rectified that problem prior to the
company's involvement in the Spider-Man movie, which became one of the biggest
grossing movies of all time.
<table>
<s> <c> <c> <c> <c> <c>
Average Annual
5 Year Return Since
3 Month 6 Month 1 Year Average Annual Inception
Return Return Return Return (August 5, 1996)
-----------------------------------------------------------------------------
IMS Capital Value Fund 24.34% 27.15% 18.28% 8.90% 10.77%
Russell Mid-Cap Value Index 17.89% 13.11% -0.64% 4.07% 10.61%
</table>
<table>
<s> <c> <c>
IMS Capital Value Fund Russell Mid-Cap Value Index
8/5/96 10,000.00 10,000.00
6/30/97 12,450.00 13,071.39
6/30/98 13,235.11 16,437.28
6/30/99 15,692.44 17,362.08
6/30/00 16,695.52 15,989.03
6/30/01 17,315.89 19,814.44
6/30/02 17,134.49 20,195.33
6/30/03 20,267.05 20,066.61
</table>
*This chart shows the value of a hypothetical initial investment of $10,000
in the Fund and the Russell Mid-Cap Value Index on August 5, 1996 (commencement
of operations) and held through June 30, 2003. The Russell Mid-Cap Value Index
is a widely recognized unmanaged index of common stocks. Performance figures
reflect the change in value of the stocks in the index and reflect reinvestment
of dividends. The index returns do not reflect expenses, which have been
deducted from the Fund's return. The returns shown do not reflect deduction of
taxes that a shareholder would pay on Fund distributions or the redemption of
Fund shares. THE FUND'S RETURN REPRESENTS PAST PERFORMANCE AND IS NOT PREDICTIVE
OF FUTURE RESULTS.
<page>
Performance - IMS Strategic Allocation Fund
After lagging slightly since its November 5, 2002 inception, the IMS
Strategic Allocation Fund approached the benchmark over the six-month period and
beat it during the second quarter of 2003.
The primary reason why the Fund lagged in the early months was an emphasis
on large-cap stocks which trailed the performance of small and mid-caps.
However, that performance advantage diminished as 2003 progressed. The Fund has
the ability to be overweight in various market capitalizations, investment
styles, industries or sectors when those areas are outperforming. In addition,
the Fund can raise cash and re-allocate funds into more defensive assets if
appropriate such as bonds, real estate investment trusts or cash equivalents.
<table>
<s> <c> <c> <c>
Total Return
3 Month 6 Month Since Inception
Return Return (November 5, 2002)
-------------------------------------------------
IMS Strategic Allocation Fund 16.43% 9.32% 5.60%
S&P 500 Index 15.39% 11.75% 7.77%
</table>
<table>
<s> <c> <c>
IMS Strategic Allocation Fund S&P 500 Index
11/4/02 10,000.00 10,000.00
11/30/02 10,200.00 10,244.85
12/31/02 9,660.00 9,643.31
1/31/03 9,380.00 9,391.19
2/28/03 9,300.00 9,250.07
3/31/03 9,070.00 9,339.62
4/30/03 9,760.00 10,108.56
5/31/03 10,440.00 10,640.65
6/30/03 10,560.00 10,776.57
</table>
*This chart shows the value of a hypothetical initial investment of $10,000
in the Fund and the S&P 500 Index on November 5, 2002 (commencement of
operations) and held through June 30, 2003. The S&P 500 Index is a widely
recognized unmanaged index of common stocks. Performance figures reflect the
change in value of the stocks in the index, reflect reinvestment of dividends
and are not annualized. The index returns do not reflect expenses, which have
been deducted from the Fund's return. The returns shown do not reflect deduction
of taxes that a shareholder would pay on Fund distributions or the redemption of
Fund shares. THE FUND'S RETURN REPRESENTS PAST PERFORMANCE AND IS NOT PREDICTIVE
OF FUTURE RESULTS.
<page>
IMS Capital Value Fund
Schedule of Investments
June 30, 2003
<table>
<s> <c> <c>
Common Stocks - 91.29% Shares Value
Bottled & Canned Soft Drinks & Carbonated Waters - 2.00%
PepsiAmericas, Inc. 50,000 $ 628,000
----------------
Cable & Other Pay Television Services - 4.04%
Comcast Corp. Class A (a) 42,000 1,267,560
----------------
Cleaning Preparations, Perfumes, Cosmetics - 2.71%
Dial Corp. 43,800 851,910
----------------
Computer Communication Equipment - 1.04%
3Com Corp (a) 70,000 327,600
----------------
Computer Storage Devices - 2.41%
EMC Corp. (a) 72,200 755,934
----------------
Dolls & Stuffed Toys - 7.30%
Marvel Enterprises, Inc. (a) (c) 120,000 2,292,000
----------------
Electrical Industrial Apparatus - 2.38%
American Power Conversion, Inc. (a) 48,000 748,320
----------------
Fats & Oils - 1.24%
Archer Daniels Midland Co. 30,250 389,317
----------------
Hospital & Medical Service Plans - 7.41%
Humana, Inc. (a) 78,900 1,191,390
PacifiCare Health Systems, Inc. (a) 23,000 1,134,590
---------------
2,325,980
----------------
Life Insurance - 1.83%
Lincoln National Corp. 16,100 573,643
----------------
National Commercial Banks - 1.12%
First Tennessee National Corp. 8,000 351,280
----------------
Petroleum Refining - 2.68%
Amerada Hess Corp. 17,100 840,978
----------------
Pharmaceutical Preparations - 4.85%
Chiron, Corp. 6,000 262,320
Watson Pharmaceuticals, Inc. (a) 31,200 1,259,544
---------------
1,521,864
----------------
</table>
See accompanying notes which are an integral part of the financial statements.
<page>
IMS Capital Value Fund
Schedule of Investments - continued
June 30, 2003
<table>
<s> <c> <c>
Common Stocks - 91.29% - continued Shares Value
Radio & Tv Broadcasting & Communications Equipment - 3.40%
Harris Corp. 12,000 $ 360,600
Motorola, Inc. 75,000 707,250
----------------
1,067,850
----------------
Refuse Systems - 1.53%
Waste Management, Inc. 20,000 481,800
----------------
Retail - Catalog & Mail - Order Houses - 1.17%
Schein Henry, Inc. (a) 7,000 366,380
----------------
Retail - Drug Stores & Proprietary Stores - 3.77%
Rite Aid Corp. (a) 266,000 1,183,700
----------------
Retail - Grocery Stores - 2.59%
Albertson's, Inc. 28,700 551,040
Winn Dixie Stores, Inc. 21,200 260,972
----------------
812,012
----------------
Retail - Miscellaneous Shopping Goods Stores - 2.19%
OfficeMax, Inc. (a) 105,000 687,750
----------------
Savings Institution, Federally Chartered - 1.39%
Sovereign Bancorp, Inc. 28,000 438,200
----------------
Security & Commodity Brokers, Dealers, Exchanges Services - 2.28%
T. Rowe Price Associates, Inc. 19,000 717,250
----------------
Semiconductors & Related Devices - 3.16%
LSI Logic Corp. (a) 140,000 991,200
----------------
Services - Computer Integrated Systems Design - 4.25%
Computer Sciences Corp. (a) 18,900 720,468
Unisys Corp. (a) 50,000 614,000
----------------
1,334,468
----------------
Services - Computer Processing & Data Preparation - 2.47%
SunGard Data Systems, Inc. (a) 30,000 777,300
----------------
Services - Computer Programming Services - 2.68%
Amdocs Ltd. (a) 35,100 842,400
----------------
Services - Health Services - 2.38%
Gentiva Health Services, Inc. (a) 83,000 747,000
----------------
</table>
See accompanying notes which are an integral part of the financial statements.
<page>
IMS Capital Value Fund
Schedule of Investments - continued
June 30, 2003
<table>
<s> <c> <c>
Common Stocks - 91.29% - continued Shares Value
Services - Personal Services - 3.19%
Cendant Corp. (a) 31,000 $ 567,920
H & R Block, Inc. 10,000 432,500
----------------
1,000,420
----------------
Services - Prepackaged Software - 4.11%
Computer Associates International, Inc. 38,300 853,324
Symantec Corp. (a) 10,000 438,600
----------------
1,291,924
----------------
Services - Skilled Nursing Care Facilities - 1.99%
Manor Care, Inc. (a) 25,000 625,250
----------------
Specialty Cleaning, Polishing and Sanitation Preparations - 1.05%
Clorox Corp. 7,700 328,405
----------------
Surgical & Medical Instruments & Apparatus - 1.41%
Guidant Corp. 10,000 443,900
----------------
Telephone Communications (No Radiotelephone) - 5.27%
CenturyTel, Inc. 31,000 1,080,350
Sprint Fon Group 40,000 576,000
----------------
1,656,350
----------------
TOTAL COMMON STOCKS (Cost $23,024,034) 28,667,945
----------------
Money Market Securities - 9.03%
Huntington Money Market Fund - Class A, 0.25%, (Cost $2,836,715) (b) 2,836,715 2,836,715
----------------
TOTAL INVESTMENTS (Cost $25,860,749) - 100.32% $ 31,504,660
----------------
Liabilities in excess of other assets - (0.32%) (99,862)
----------------
TOTAL NET ASSETS - 100.00% $ 31,404,798
================
</table>
(a) Non-income producing.
(b) Variable rate security; the coupon rate shown represents the rate at
June 30, 2003.
(c) Portion of security is pledged as collateral for call options written.
See accompanying notes which are an integral part of the financial statements.
<page>
IMS Capital Value Fund
Schedule of Investments - continued
June 30, 2003
Options Written as of June 30, 2003
<table>
<s> <c> <c>
Shares
Subject
Common Stocks / Expiration Date @ Exercise Price to Call Value
- -------------------------------------------------------- ------------- ----------------
Marvel Enterprises, Inc. / September 2003 @ 20 75,800 $ 144,020
Total (premiums received $104,521) 75,800 $ 144,020
================
</table>
See accompanying notes which are an integral part of the financial statements.
<page>
IMS Strategic Allocation Fund
Schedule of Investments
June 30, 2003
<table>
<s> <c> <c>
Unit Investment Trusts - 77.87% Shares Value
iShares S&P MidCap 400 / BARRA Growth Index Fund 5,400 $ 552,150
iShares Dow Jones U.S. Telecommunications Sector Index Fund 8,200 169,658
iShares S&P MidCap 400 / BARRA Value Index Fund 2,800 248,668
iShares Dow Jones U.S. Energy Sector Index Fund 2,200 94,996
iShares Dow Jones U.S. Healthcare Sector Index Fund 1,700 92,565
iShares Goldman Sachs Software Index Fund (a) 2,500 77,750
iShares S&P 500 / BARRA Value Index Fund 5,300 252,810
iShares S&P SmallCap 600 / BARRA Value Index Fund 5,700 464,550
iShares S&P SmallCap 600 / BARRA Growth Index Fund 6,700 489,100
iShares S&P 500 / BARRA Growth Index Fund 12,000 595,200
TOTAL UNIT INVESTMENT TRUSTS (Cost $2,816,909) 3,037,447
----------------
Money Market Securities - 21.72%
Huntington Money Market Fund - Class A, 0.25%, (Cost $847,006) (b) 847,006 847,006
----------------
TOTAL INVESTMENTS (Cost $3,663,915) - 99.59% $ 3,884,453
----------------
Other assets less liabilities - 0.41% 15,909
----------------
TOTAL NET ASSETS - 100.00% $ 3,900,362
================
</table>
(a) Non-income producing.
(b) Variable rate security; the coupon rate shown represents the yield at
June 30, 2003.
See accompanying notes which are an integral part of the financial statements.
<page>
Statement of Assets and Liabilities
June 30, 2003
<table>
<s> <c> <c>
IMS Capital IMS Strategic
Value Fund Allocation Fund
Assets
Investments in securities, at value $ 31,504,660 $ 3,884,453
(cost $25,860,749 and $3,663,915 respectively)
Interest receivable 422 54
Dividends receivable 12,262 -
Receivable for fund shares sold 46,552 18,410
Receivable from Advisor 3,184 14,625
-------------------- -----------------
Total assets 31,567,080 3,917,542
-------------------- -----------------
Liabilities
Payable for fund shares redeemed 989 -
Other payables and accrued expenses 17,273 17,180
Call options written (premiums received $104,521) 144,020 -
-------------------- -----------------
Total liabilities 162,282 17,180
-------------------- -----------------
Net Assets:
Applicable to 2,235,136 and 369,516 shares
outstanding, respectively $ 31,404,798 $ 3,900,362
==================== =================
Net Assets consist of:
Paid in capital $ 26,226,617 $ 3,645,029
Accumulated net realized gain (loss) on investments (426,231) 34,795
Net unrealized appreciation (depreciation) on investments 5,604,412 220,538
-------------------- -----------------
$ 31,404,798 $ 3,900,362
==================== =================
Net asset value and offering
price per share $ 14.05 $ 10.56
==================== =================
Redemption price per share (a) $ 13.98 $ 10.51
==================== =================
</table>
(a) The redemption price per share reflects a redemption fee of 0.50% on
shares redeemed within 90 days of purchase.
See accompanying notes which are an integral part of the financial statements.
<page>
IMS Funds
Statement of Operations
<table>
<s> <c> <c>
IMS Capital IMS Strategic
Value Fund Allocation Fund
Year Ended Period Ended
June 30, 2003 June 30, 2003 (a)
Investment Income
Dividend income $ 166,683 $ 16,476
Interest income 62,772 441
----------------- -------------------
Total Income 229,455 16,917
----------------- -------------------
Expenses
Investment advisor fee 228,957 19,195
Legal expenses 26,813 5,021
Administration expenses 24,657 5,856
Transfer agent expenses 22,673 10,168
Fund accounting expenses 21,699 6,327
Miscellaneous expenses 11,882 602
Registration expenses 9,439 11,047
Custodian expenses 7,689 3,214
Auditing expenses 7,572 7,030
Trustee expenses 4,229 2,460
Pricing expenses 4,015 1,004
Insurance expenses 3,033 -
Printing expenses 1,184 1,004
----------------- -------------------
Total Expenses 373,842 72,928
Reimbursed expenses (83,372) (42,945)
----------------- -------------------
Total operating expenses 290,470 29,983
----------------- -------------------
Net Investment Income (Loss) (61,015) (13,066)
----------------- -------------------
Realized & Unrealized Gain (Loss)
Net realized gain (loss) on investment securities 320,703 47,861
Net realized gain (loss) on option transactions (236,581)
Change in net unrealized appreciation (depreciation)
on investment securities 4,174,278 220,538
----------------- -------------------
Net realized and unrealized gain (loss) on investment securities 4,258,400 268,399
----------------- -------------------
Net increase (decrease) in net assets resulting from operations $ 4,197,385 $ 255,333
================= ===================
</table>
(a) For period of November 5, 2002 (commencement of operations) through
June 30, 2003.
See accompanying notes which are an integral part of the financial statements.
<page>
IMS Funds
Statements of Changes In Net Assets
<table>
<s> <c> <c> <c>
IMS Capital IMS Strategic
Value Fund Allocation Fund
Year ended Year ended Period ended
Increase (Decrease) in Net Assets June 30, 2003 June 30, 2002 June 30, 2003 (a)
Operations ----------------- ----------------- -------------------
Net investment income (loss) $ (61,015) $ 39,600 $ (13,066)
Net realized gain (loss) on investment securities 320,703 (319,190) 47,861
Net realized gain (loss) on option transactions (236,581) - -
Change in net unrealized appreciation (depreciation) 4,174,278 (47,829) 220,538
----------------- ----------------- -------------------
Net increase (decrease) in net assets resulting from operations 4,197,385 (327,419) 255,333
----------------- ----------------- -------------------
Distributions
From net investment income (39,209) - -
From net realized gain - (1,491,184) -
From return of capital (31,729) - -
----------------- ----------------- -------------------
Total distributions (70,938) (1,491,184) -
----------------- ----------------- -------------------
Capital Share Transactions
Proceeds from shares sold 14,575,612 13,518,420 4,095,810
Reinvestment of distributions 68,638 1,453,985 -
Amount paid for shares repurchased (4,509,797) (7,498,133) (450,781)
----------------- ----------------- -------------------
Net increase (decrease) in net assets resulting
from share transactions 10,134,453 7,474,272 3,645,029
----------------- ----------------- -------------------
Total Increase (Decrease) in Net Assets 14,260,900 5,655,669 3,900,362
----------------- ----------------- -------------------
Net Assets
Beginning of period 17,143,898 11,488,229 -
----------------- ----------------- -------------------
End of period $ 31,404,798 $ 17,143,898 $ 3,900,362
================= ================= ===================
Accumulated undistributed net
investment income included
in net assets at end of period $ - $ 39,600 $ -
----------------- ----------------- -------------------
Capital Share Transactions
Shares sold 1,185,162 1,088,375 416,154
Shares issued in reinvestment of distributions 6,063 121,978 -
Shares repurchased (393,648) (601,161) (46,638)
----------------- ----------------- -------------------
Net increase (decrease) from capital transactions 797,577 609,192 369,516
================= ================= ===================
</table>
(a) For period of November 5, 2002 (commencement of operations) through
June 30, 2003.
See accompanying notes which are an integral part of the financial statements.
<page>
IMS Capital Value Fund
Financial Highlights
<table>
<s> <c> <c> <c> <c> <c> <c>
Year ended Year ended Year ended Year ended Period ended Year ended
June 30, 2003 June 30, 2002 June 30, 2001 June 30, 2000 June 30, 1999(c) Oct. 31, 1998
---------------- -------------- -------------- -------------- ----------------- ---------------
Selected Per Share Data
Net asset value, beginning of period $ 11.93 $ 13.87 $ 13.91 $ 14.56 $ 11.28 $ 12.06
---------------- -------------- -------------- -------------- ----------------- ---------------
Income from investment operations
Net investment income (loss) (0.04) 0.04 (0.05) (0.05) 0.00 (0.06)
Net realized and unrealized gain (loss) 2.21 (0.19) 0.50 0.88 3.28 0.12
---------------- -------------- -------------- -------------- ----------------- ---------------
Total from investment operations 2.17 (0.15) 0.45 0.83 3.28 0.06
---------------- -------------- -------------- -------------- ----------------- ---------------
Less Distributions to shareholders:
From net investment income (0.03) 0.00 0.00 0.00 0.00 (0.03)
From net realized gain 0.00 (1.79) (0.49) (1.48) 0.00 (0.81)
From return of capital (0.02) 0.00 0.00 0.00 0.00 0.00
---------------- -------------- -------------- -------------- ----------------- ---------------
Total distributions (0.05) (1.79) (0.49) (1.48) 0.00 (0.84)
---------------- -------------- -------------- -------------- ----------------- ---------------
Net asset value, end of period $ 14.05 $ 11.93 $ 13.87 $ 13.91 $ 14.56 $ 11.28
================ ============== ============== ============== ================= ===============
Total Return 18.28% (1.05)% 3.72% 6.39% 29.08% (b) 2.27%
Ratios and Supplemental Data
Net assets, end of period (000) $ 31,405 $ 17,144 $ 11,488 $ 11,585 $ 11,608 $ 11,524
Ratio of expenses to average net assets 1.59% 1.59% 1.59% 1.59% 1.59% (a) 1.73%
Ratio of expenses to average net assets
before waiver & reimbursement 2.05% 2.23% 2.28% 2.08% 2.50% (a) 2.34%
Ratio of net investment income to
average net assets (0.34)% 0.29% (0.39)% (0.36)% (0.04)(a) (0.53)%
Ratio of net investment income to
average net assets before waiver &
reimbursement (0.79)% (0.35)% (1.09)% (0.84)% (0.95)(a) (1.14)%
Portfolio turnover rate 44.72% 33.40% 77.87% 75.69% 45.19% 81.74%
</table>
(a) Annualized.
(b) For periods of less than a full year, total return is not annualized.
(c) For the period November 1, 1998 through June 30, 1999.
See accompanying notes which are an integral part of the financial statements.
<page>
IMS Strategic Allocation Fund
Financial Highlights
<table>
<s> <c>
Period ended
June 30, 2003 (a)
-----------------
Selected Per Share Data
Net asset value, beginning of period $ 10.00
-----------------
Income from investment operations
Net investment income (loss) (0.05)
Net realized and unrealized gain (loss) 0.61
-----------------
Total from investment operations 0.56
-----------------
Less Distributions to shareholders:
From net investment income 0.00
From net realized gain 0.00
-----------------
Total distributions 0.00
-----------------
Net asset value, end of period $ 10.56
=================
Total Return 5.60% (b)
Ratios and Supplemental Data
Net assets, end of period (000) $ 3,900
Ratio of expenses to average net assets 1.96% (c)
Ratio of expenses to average net assets
before waiver & reimbursement 4.75% (c)
Ratio of net investment income to
average net assets 0.85% (c)
Ratio of net investment income to
average net assets before waiver & reimbursement (3.65)(c)
Portfolio turnover rate 226.36%
</table>
(a) For the period November 5, 2002 (Commencement of operations) through
June 30, 2003.
(b) For periods of less than a full year, total return is not annualized.
(c) Annualized.
See accompanying notes which are an integral part of the financial statements.
<page>
IMS Funds
Notes to Financial Statements
June 30, 2003
NOTE 1. ORGANIZATION
IMS Capital Value Fund (the "Capital Value Fund") was organized as a
diversified series of AmeriPrime Funds (the "Trust") on July 25, 1996 and
commenced operations on August 5, 1996. The IMS Strategic Allocation Fund (the
"Strategic Allocation Fund") was organized as a non-diversified series of the
Trust on September 30, 2002 and commenced operations on November 5, 2002. The
Trust is an open-end investment company established under the laws of Ohio by an
Agreement and Declaration of Trust dated August 8, 1995 (the "Trust Agreement").
The Trust Agreement permits the Trustees to issue an unlimited number of shares
of beneficial interest of separate series without par value. Each Fund is one of
a series of funds currently authorized by the Trustees. The investment objective
of the Capital Value Fund is to provide long-term growth from capital
appreciation, dividends and interest. The investment objective of the Strategic
Allocation Fund is to provide long-term growth from capital appreciation,
dividends and interest. The investment advisor of each Fund is IMS Capital
Management, Inc. (the "Advisor").
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by
the Fund in the preparation of its financial statements.
Securities Valuations - Securities that are traded on any exchange or on
the NASDAQ over-the-counter market are valued at the last quoted sale price.
Lacking a last sale price, a security is valued at its last bid price except
when, in the opinion of the Advisor, the last bid price does not accurately
reflect the current value of the security. All other securities for which
over-the-counter market quotations are readily available are valued at their
last bid price. When market quotations are not readily available, when the
Advisor determines the last bid price does not accurately reflect the current
value or when restricted securities are being valued, such securities are valued
as determined in good faith by the Advisor, in conformity with guidelines
adopted by and subject to review of the Board of Trustees.
Fixed income securities generally are valued by using market quotations,
but may be valued on the basis of prices furnished by a pricing service when the
Advisor believes such prices accurately reflect the fair market value of such
securities. A pricing service utilizes electronic data processing techniques
based on yield spreads relating to securities with similar characteristics to
determine prices for normal institutional-size trading units of debt securities
without regard to sale or bid prices. If the Advisor decides that a price
provided by the pricing service does not accurately reflect the fair market
value of the securities, when prices are not readily available from a pricing
service or when restricted or illiquid securities are being valued, securities
are valued at fair value as determined in good faith by the Advisor, in
conformity with guidelines adopted by and subject to review of the Board of
Trustees. Short-term investments in fixed income securities with maturities of
less than 60 days when acquired, or which subsequently are within 60 days of
maturity, are valued by using the amortized cost method of valuation, which the
Board of Trustees has determined will represent fair value.
Option writing - When each Fund writes an option, an amount equal to the
premium received by each Fund is recorded as a liability and is subsequently
adjusted to the current fair value of the option written. Premiums received from
writing options that expire unexercised are treated by each Fund on the
expiration date as realized gains from investments. The difference between the
premium and the amount paid on effecting a closing purchase transaction,
including brokerage commissions, is also treated as a realized gain, or if the
premium is less than the amount paid for the closing purchase transaction, as a
realized loss. If a call option is exercised, the premium is added to the
proceeds from the sale of the underlying security or currency in determining
whether each Fund has realized a gain or loss. If a put option is exercised, the
premium reduces the cost basis of the securities purchased by each Fund. Each
Fund as writer of an option bears the market risk of an unfavorable change in
the price of the security underlying the written option.
<page>
IMS Funds
Notes to Financial Statements
June 30, 2003
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES - continued
Federal Income Taxes - Each Fund intends to qualify each year as a
"regulated investment company" under the Internal Revenue Code of 1986, as
amended. By so qualifying, each Fund will not be subject to federal income taxes
to the extent that it distributes substantially all of its net investment income
and any realized capital gains.
Dividends and Distributions - Each Fund intends to comply with federal tax
rules regarding distribution of substantially all of its net investment income
and capital gains. These rules may cause multiple distributions during the
course of the year.
Other - Each Fund follows industry practice and records security
transactions on the trade date. The specific identification method is used for
determining gains or losses for financial statement and income tax purposes.
Dividend income is recorded on the ex-dividend date and interest income is
recorded on an accrual basis. Discounts and premiums on securities purchased are
amortized over the life of the respective securities. Generally accepted
accounting principles require that permanent financial reporting tax differences
relating to shareholder distributions be reclassified to paid-in-capital for the
Capital Value Fund and to realized gains for the Strategic Allocation Fund.
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Each Fund retains IMS Capital Management, Inc. to manage the Fund's
investments. Carl W. Marker, Chairman and President of the Advisor, is primarily
responsible for the day-to-day management of the Fund's portfolio.
Under the terms of the management agreement (the "Agreement"), the Advisor
manages each Fund's investments subject to approval of the Board of Trustees. As
compensation for its management services, the Fund is obligated to pay the
Advisor a fee computed and accrued daily and paid monthly at an annual rate of
1.26% of the average daily net assets of each Fund. For the year ended June 30,
2003, the Advisor earned a fee of $228,957 from the Capital Value Fund. For the
period of November 5, 2002 (commencement of operations) through June 30, 2003,
the Advisor earned a fee of $19,195 from the Strategic Allocation Fund.
The Advisor has contractually agreed to waive all or a portion of its fees
and/or reimburse expenses of each Fund, but only to the extent necessary to
maintain total operating expenses (excluding brokerage costs, borrowing costs,
taxes and extraordinary expenses) at 1.59% of average daily net assets with
respect to the Capital Value Fund, and 1.96% of average daily net assets with
respect to the Strategic Allocation Fund through October 31, 2006. The Advisor
has also agreed to reimburse organizational expenses of the Strategic Allocation
Fund. For the year ended June 30, 2003, the Advisor reimbursed expenses of
$83,372 for the Capital Value Fund. For the period of November 5, 2002
(commencement of operations) through June 30, 2003, the Advisor reimbursed
expenses of $42,945 for the Strategic Allocation Fund. With respect to the
Strategic Allocation Fund, any waiver or reimbursement of organizational or
operating expenses by the Advisor is subject to repayment by the Fund within the
three fiscal years following the year ending June 30, 2003, if the Fund is able
to make the payment without exceeding the above described expense limitations.
Each Fund retains Unified Fund Services, Inc. ("Unified"), a wholly owned
subsidiary of Unified Financial Services, Inc., to manage each Fund's business
affairs and provide the Fund with administrative services, including all
regulatory reporting and necessary office equipment and personnel.
<page>
IMS Funds
Notes to Financial Statements
June 30, 2003
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - continued
For those services Unified receives a monthly fee from each Fund equal to
an annual rate of 0.10% of each Fund's average daily net assets under $50
million, 0.075% of each Fund's average daily net assets from $50 million to $100
million, and 0.05% of each Fund's average daily net assets over $100 million
(subject to a minimum fee of $2,500 per month). For the year ended June 30,
2003, Unified earned $24,657 from the Capital Value Fund. For the period of
November 5, 2002 (commencement of operations) through June 30, 2003, Unified
earned $5,856 from the Strategic Allocation Fund.
Each Fund also retains Unified to act as each Fund's transfer agent and
fund accountant. For its services as transfer agent, Unified receives a monthly
fee from each Fund of $1.20 per shareholder (subject to a minimum monthly fee of
$900) for these transfer agency services. For the year ended June 30, 2003,
Unified earned $22,673 from the Capital Value Fund. For the period of November
5, 2002 (commencement of operations) through June 30, 2003, Unified earned
$10,168 from the Strategic Allocation Fund. For its services as fund accountant,
Unified receives an annual fee from each Fund equal to 0.0275% of the Fund's
assets up to $100 million, and 0.025% of the Fund's assets from $100 million to
$300 million, and 0.02% of the Fund's assets over $300 million (subject to
various monthly minimum fees, the maximum being $2,100 per month for assets of
$20 million to $100 million). For the year ended June 30, 2003, Unified earned
$21,699 from the Capital Value Fund. For the period of November 5, 2002
(commencement of operations) through June 30, 2003, Unified earned $6,327 from
the Strategic Allocation Fund. Certain Trustees and the officers of the Trust
are members of management, employees, and/or shareholders of Unified.
Each Fund retains Unified Financial Securities, Inc., (the "Distributor") a
wholly owned subsidiary of Unified Financial Services, Inc., to act as the
principal distributor of its shares. Prior to March 18, 2003, Capital Research
Brokerage, LLC ("Capital Research") was the distributor for the Capital Value
Fund. For the period of July 1, 2002 through March 17, 2003, no payments were
made to Capital Research from the Capital Value Fund. There were no payments
made to the Distributor for the period of March 18, 2003 through June 30, 2003
from the Capital Value Fund and for the period ended June 30, 2003 from the
Strategic Allocation Fund. Timothy L. Ashburn (a Trustee and officer of the
Trust) and Thomas G. Napurano (an officer of the Trust) are a director and
officer, respectively, of the Distributor and of Unified Financial Services,
Inc. (the parent company of the Distributor), and may be deemed to be affiliates
of the Distributor.
NOTE 4. INVESTMENTS
Capital Value Fund. For the year ended June 30, 2003, purchases and sales
of investment securities, other than short-term investments, aggregated
$16,718,327 and $7,947,927, respectively. As of June 30, 2003, the gross
unrealized appreciation for all securities totaled $5,982,741 and the gross
unrealized depreciation for all securities totaled $439,952 for net unrealized
appreciation of $5,542,789. The aggregate cost of securities for federal income
tax purposes at June 30, 2003 was $25,817,851. The difference between book cost
and tax cost consists of wash sales in the amount of $61,623.
Strategic Allocation Fund. For the period of November 5, 2002 (commencement
of operations) through June 30, 2003, purchases and sales of investment
securities, other than short-term investments, aggregated $7,857,859 and
$5,088,811, respectively. As of June 30, 2003, the gross unrealized appreciation
for all securities totaled $177,168 and the gross unrealized depreciation for
all securities totaled $0 for net unrealized appreciation of $177,168. The
aggregate cost of securities for federal income tax purposes at June 30, 2003
was $3,707,285. The difference between book cost and tax cost consists of wash
sales in the amount of $43,370.
<page>
IMS Funds
Notes to Financial Statements
June 30,2003
NOTE 5. ESTIMATES
Preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and the reported amounts
of revenues and expenses during the reporting period. Actual results could
differ from those estimates.
NOTE 6. RELATED PARTY TRANSACTIONS
The beneficial ownership, either directly or indirectly, of more than 25%
of the voting securities of a fund creates a presumption of control of the fund,
under Section 2(a)(9) of the Investment Company Act of 1940. As of June 30,
2003, National Financial Securities Corp. held 26.99% of the Capital Value Fund
in an omnibus account for the benefit of others. As of June 30, 2003, National
Financial Securities Corp. held 56.13% of the Strategic Allocation Fund in an
omnibus account for the benefit of others.
NOTE 7. LOSS CARRYFORWARDS
Capital Value Fund. At June 30, 2003, the Capital Value Fund had available
for federal tax purposes an unused capital loss carryforward of $309,394, which
expires in 2010. Capital loss carryforwards are available to offset future
realized capital gains. To the extent that these carryforwards are used to
offset future capital gains, it is probable that the amount which is offset will
not be distributed to shareholders.
NOTE 8. DISTRIBUTION TO SHAREHOLDERS
Capital Value Fund. On December 12, 2002, a distribution of $0.0492 was
declared. The dividend was paid on December 12, 2002, to shareholders of record
on December 11, 2002.
The tax character of distributions paid during fiscal years 2003 and 2002
was as follows.
<table>
<s> <c> <c>
Distributions paid from: 2003 2002
---------------- ----------------
Ordinary income $ 39,209 $ -
Short-term Capital Gain - 194,339
Long-term Capital Gain - 1,296,845
Return of Capital 31,729 -
---------------- ----------------
$ 70,938 $ 1,491,184
================ ================
</table>
<page>
IMS Funds
Notes to Financial Statements
June 30, 2003
NOTE 8. DISTRIBUTION TO SHAREHOLDERS- continued
Strategic Allocation Fund. The Strategic Allocation Fund paid no income or
capital gain distributions for the period ended June 30, 2003.
As of June 30, 2003, the components of distributable earnings/(accumulated
losses) on a tax basis were as follows:
<table>
<s> <c> <c>
Capital Value Fund Strategic Allocation Fund
-------------------- ----------------------------
Undistributed ordinary
income/(accumulated losses) $ - $ 78,165
Undistributed long-term capital
gain/(accumulated losses) (364,608) -
Unrealized appreciation/(depreciation) 5,542,789 177,168
-------------------- ----------------------------
-------------------- ----------------------------
$ 5,178,181 $ 255,333
==================== ============================
</table>
The difference between book basis and tax basis unrealized depreciation is
attributable to the tax deferral of losses on wash sales.
NOTE 9. CALL OPTIONS WRITTEN
As of June 30, 2003, portfolio securities valued at $1,447,780 were
segregated by the custodian for call options written by the Capital Value Fund.
Transactions in options written during the year ended June 30, 2003 for the
Capital Value Fund were as follows:
<table>
<s> <c> <c>
Number
of Premiums
Contracts Received
------------- --------------
Options outstanding at June 30, 2002 - $ -
Options written 758 104,521
Options terminated in closing purchase transactions - -
Options expired - -
Options exercised - -
------------- --------------
Options outstanding at June 30, 2003 758 $ 104,521
============= ==============
</table>
<page>
The following table provides information regarding each Trustee who is an
"interested person" of the Trust, as defined in the Investment Company Act of
1940, and each officer of the Trust (Unaudited).
<table>
<s> <c> <c> <c>
- ------------------------ ---------------------------------------- ------------------------------- --------------------
Number of
Name, Age and Address Position(s) Held with the Fund Complex1 Length of Time Served Portfolios in Fund
Complex1 Overseen
by Trustee
- ------------------------ ---------------------------------------- ------------------------------- --------------------
- ------------------------ ---------------------------------------- ------------------------------- --------------------
Timothy Ashburn2 President, Secretary and Trustee President and Secretary since 24
1104 Buttonwood Court October 2002; Trustee of
Lexington, KY 40515 AmeriPrime Advisors Trust
since November 2002,
Year of Birth: 1950 AmeriPrime Funds since
December 2002, and Unified
Series Trust since October
2002
- ------------------------ ---------------------------------------- ------------------------------- --------------------
- ----------------------------------------------------------------- ----------------------------------------------------
</table>
<table>
<s> <c>
Principal Occupations During Past 5 Years Other Directorships Held by Trustee
- ----------------------------------------------------------------- ----------------------------------------------------
- ----------------------------------------------------------------- ----------------------------------------------------
Chairman of Unified Financial Services, Inc. since 1989 and Unified Financial Services, Inc.
Chief Executive Officer from 1989 to 1992 and 1994 to April since 1989
2002; President of Unified Financial Services from November
1997 to April 2000.
- ----------------------------------------------------------------- ----------------------------------------------------
- ------------------------ ---------------------------------------- ------------------------------- --------------------
</table>
<table>
<s> <c> <c> <c>
Number of
Name, Age and Address Position(s) Held with the Fund Complex1 Length of Time Served Portfolios in Fund
Complex1 Overseen
by Trustee
- ------------------------ ---------------------------------------- ------------------------------- --------------------
- ------------------------ ---------------------------------------- ------------------------------- --------------------
Ronald C. Tritschler3 Trustee Trustee of AmeriPrime Funds 24
2361 Old Hickory Lane and Unified Series Trust
Lexington, KY 40515 since December 2002 and
AmeriPrime Advisors Trust
Year of Birth: 1952 since November 2002
- ------------------------ ---------------------------------------- ------------------------------- --------------------
- ----------------------------------------------------------------- ----------------------------------------------------
</table>
<table>
<s> <c>
Principal Occupations During Past 5 Years Other Directorships Held by Trustee
- ----------------------------------------------------------------- ----------------------------------------------------
- ----------------------------------------------------------------- ----------------------------------------------------
Chief Executive Officer, Director and legal counsel of The Webb None
Companies, a national real estate company, from 2001 to
present; Executive Vice President and Director of The Webb
Companies from 1990 to 2000; Director, The Lexington Bank, from
1998 to present; Director, Vice President and legal counsel for
The Traxx Companies, an owner and operator of convenience
stores, from 1989 to present.
- ----------------------------------------------------------------- ----------------------------------------------------
- ------------------------ ---------------------------------------- ------------------------------- --------------------
</table>
<page>
<table>
<s> <c> <c> <c>
Position(s) Held with the Fund Complex1 Length of Time Served Number of
Name, Age and Address Portfolios in Fund
Complex1 Overseen
by Trustee
- ------------------------ ---------------------------------------- ------------------------------- --------------------
- ------------------------ ---------------------------------------- ------------------------------- --------------------
Thomas G. Napurano Treasurer and Chief Financial Officer Since October 2002 for N/A
2424 Harrodsburg Road AmeriPrime Funds and
Lexington, KY 40503 AmeriPrime Advisors Trust;
since December 2002 for
Year of Birth: 1941 Unified Series Trust
- ------------------------ ---------------------------------------- ------------------------------- --------------------
- ----------------------------------------------------------------- ----------------------------------------------------
</table>
<table>
<s> <c>
Principal Occupations During Past 5 Years Other Directorships Held by Trustee
- ----------------------------------------------------------------- ----------------------------------------------------
- ----------------------------------------------------------------- ----------------------------------------------------
Chief Financial Officer and Executive Vice President of Unified N/A
Financial Services, Inc., the parent company of the Trust's
administrator and principal underwriter; member of the board of
directors of Unified Financial Services, Inc. from 1989 to
March 2002.
- ----------------------------------------------------------------- ----------------------------------------------------
- ------------------------ ---------------------------------------- ------------------------------- --------------------
</table>
<table>
<s> <c> <c> <c>
Number of
Name, Age and Address Position(s) Held Length of Time Served Portfolios
with Trust in Fund Complex1
Overseen by Trustee
- ------------------------ ---------------------------------------- ------------------------------- --------------------
- ------------------------ ---------------------------------------- ------------------------------- --------------------
Carol Highsmith Assistant Secretary Since October 2002 for N/A
431 N. Pennsylvania St. AmeriPrime Funds and AmeriPrime
Indianapolis, IN 46204 Advisors Trust; since
December 2002 for
Unified Series Trust
Year of Birth: 1964
- ------------------------ ---------------------------------------- ------------------------------- --------------------
- ----------------------------------------------------------------- ----------------------------------------------------
</table>
<table>
<s> <c>
Principal Occupations During Past 5 Years Other Directorships Held
- ----------------------------------------------------------------- ----------------------------------------------------
- ----------------------------------------------------------------- ----------------------------------------------------
Employed by Unified Fund Services, Inc. (November 1994 to None
present); Vice President and Asst. Secretary of Lindbergh
Funds; Asst. Secretary of AmeriPrime Funds and AmeriPrime
Advisors Trust (October 2002 to present).
- ----------------------------------------------------------------- ----------------------------------------------------
</table>
1 The term "Fund Complex" refers to AmeriPrime Funds, AmeriPrime Advisors
Trust, and Unified Series Trust.
2 Mr. Ashburn is an "interested person" of the Trust because he is an
officer of the Trust. In addition, he may be deemed to be an "interested person"
of the Trust because he is Chairman and a director of Unified Financial
Securities, Inc., the principal underwriter for certain funds in the Fund
Complex.
3 Mr. Tritschler may be deemed to be an "interested person" of the Trust
because he has an ownership interest in Unified Financial Services, Inc., the
parent of the principal underwriter for certain funds in the Fund Complex.
<page>
The following table provides information regarding each Trustee who is not
an "interested person" of the Trust, as defined in the Investment Company Act of
1940 (Unaudited).
<table>
<s> <c> <c> <c>
- ------------------------------ ---------------------------------- ----------------------- -------------------------
Name, Age and Address Position(s) Held with the Fund Length of Time Served Number of Portfolios in
Complex1 Fund Complex1 Overseen
by Trustee
- ------------------------------ ---------------------------------- ----------------------- -------------------------
- ------------------------------ ---------------------------------- ----------------------- -------------------------
Gary E. Hippenstiel Trustee Trustee of AmeriPrime 24
600 Jefferson Street Funds since 1995,
Suite 350 AmeriPrime Advisors
Houston, TX 77002 Trust since July 2002
and Unified Series
Year of Birth: 1947 Trust since December
2002
- ------------------------------ ---------------------------------- ----------------------- -------------------------
- ----------------------------------------------------------------- -------------------------------------------------
</table>
<table>
<s> <c>
Principal Occupations During Past 5 Years Other Directorships Held by Trustee
- ----------------------------------------------------------------- -------------------------------------------------
- ----------------------------------------------------------------- -------------------------------------------------
Director, Vice President and Chief Investment Officer of Legacy None
Trust Company, N.A. since 1992.
- ----------------------------------------------------------------- -------------------------------------------------
- ------------------------------ ---------------------------------- ----------------------- -------------------------
</table>
<table>
<s> <c> <c> <c>
Position(s) Held Length of Time Served Number of Portfolios in
Name, Age and Address with the Fund Complex1 Fund Complex1
Overseen by Trustee
- ------------------------------ ---------------------------------- ----------------------- -------------------------
- ------------------------------ ---------------------------------- ----------------------- -------------------------
Stephen A. Little Trustee Trustee of AmeriPrime 24
3647 Totem Lane Funds and Unified
Indianapolis, IN 46208 Series Trust since
Year of Birth: 1946 December 2002 and
AmeriPrime Advisors
Trust since November
2002
- ------------------------------ ---------------------------------- ----------------------- -------------------------
- ----------------------------------------------------------------- -------------------------------------------------
</table>
<page>
<table>
<s> <c>
Principal Occupations During Past 5 Years Other Directorships Held by Trustee
- ----------------------------------------------------------------- -------------------------------------------------
- ----------------------------------------------------------------- -------------------------------------------------
President and founder, The Rose, Inc., a registered investment None
advisor, since April 1993.
- ----------------------------------------------------------------- -------------------------------------------------
- ------------------------------ ---------------------------------- ----------------------- -------------------------
</table>
<table>
<s> <c> <c> <c>
Position(s) Held with the Fund Number of Portfolios in
Name, Age and Address Complex1 Length of Time Served Fund Complex1 Overseen
by Trustee
- ------------------------------ ---------------------------------- ----------------------- -------------------------
- ------------------------------ ---------------------------------- ----------------------- -------------------------
Daniel Condon Trustee Trustee of AmeriPrime 24
2385 The Woods Lane Funds and Unified
Lexington, KY 40502 Series Trust since
December 2002 and
Year of Birth: 1950 AmeriPrime Advisors
Trust since November
2002
- ------------------------------ ---------------------------------- ----------------------- -------------------------
- ----------------------------------------------------------------- -------------------------------------------------
</table>
<table>
<s> <c>
Principal Occupations During Past 5 Years Other Directorships Held by Trustee
- ----------------------------------------------------------------- -------------------------------------------------
- ----------------------------------------------------------------- -------------------------------------------------
Vice President and General Manager, International Crankshaft None
Inc., an automotive equipment manufacturing company, 1990 to
present; Trustee, The Unified Funds, from 1994 to 2002;
Trustee, Star Select Funds, a REIT mutual fund, from 1997 to
2000.
- ----------------------------------------------------------------- -------------------------------------------------
</table>
1 The term "Fund Complex" refers to AmeriPrime Funds, AmeriPrime Advisors
Trust and Unified Series Trust.
<page>
INDEPENDENT AUDITOR'S REPORT
To The Shareholders and
Board of Trustees
IMS Capital Value Fund
IMS Strategic Allocation Fund
(series' of AmeriPrime Funds)
We have audited the accompanying statements of assets and liabilities of
IMS Capital Value Fund and IMS Strategic Allocation Fund, including the
schedules of portfolio investments, as of June 30, 2003, the related statements
of operations for the year then ended, and the statements of changes in net
assets and the financial highlights for each of the periods indicated. These
financial statements and financial highlights are the responsibility of the
Funds' management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included confirmation of
investments and cash held as of June 30, 2003 by correspondence with the
custodian. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of IMS
Capital Value Fund and IMS Strategic Allocation Fund as of June 30, 2003, the
results of their operations for the year then ended, and the changes in their
net assets and the financial highlights for each of the periods indicated, in
conformity with accounting principles generally accepted in the United States of
America.
/s/ McCurdy & Associates CPA's, Inc.
McCurdy & Associates CPA's, Inc.
Westlake, Ohio 44145
July 16, 2003
<page>
Item 2. Code of Ethics. Not applicable.
Item 3. Audit Committee Financial Expert. Not applicable.
Item 4. Principal Accountant Fees and Services. Not applicable.
Items 5-6. Reserved.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Funds.
Not applicable.
Item 8. Reserved.
Item 9. Controls and Procedures.
(a) Based on an evaluation of the registrant's disclosure controls and
procedures as of June 30, 2003, the disclosure controls and procedures are
reasonably designed to ensure that the information required in filings on Forms
N-CSR is recorded, processed, summarized, and reported on a timely basis.
(b) There were no significant changes in the registrant's internal control
over financial reporting that occurred during the registrant's last fiscal
half-year that have materially affected, or are reasonably likely to materially
affect, the registrant's internal control over financial reporting.
[Applies to annual and semi-annual reports.] .
Item 10. Exhibits.
(a)(1) Not applicable.[see Item 2.]
(a)(2) Certifications required by Item 10(a)(2) of Form N-CSR are filed
herewith.
(b) Certification required by Item 10(b) of Form N-CSR is filed herewith.
(a)(1) Annual reports only: Any code of ethics, or amendment thereto, that
is the subject of the disclosure required by Item 2, to the extent that the
registrant intends to satisfy the Item 2 requirements through filing of an
exhibit. (registrant may file the Code of Ethics, or state in the annual report
that 1) the Code is available on website (give address) or 2) state that the
Code is available on request without charge, and explain how to request a copy.
(a)(2) A separate certification for each principal executive officer and
principal financial officer of the registrant as required by Rule 30a-2(a) under
the Act (17 CFR 270.30a-2).
(b) Provide the 906 Certification as required by Rule 30a-2(b).
<page>
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)AmeriPrime Funds
/s/ Timothy Ashburn
Timothy Ashburn, President
Date 8/27/03
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
/s/ Timothy Ashburn
Timothy Ashburn, President
Date 8/27/03
/s/ Thomas Napurano
Thomas Napurano, Chief Financial Officer
Date 8/27/03