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 811-08191
Name of Fund: Bullfinch Fund, Inc.
Fund Address: 1370 Pittsford Mendon Road
Mendon, New York 14506
Name and address of agent for service: Christopher Carosa, President,
Bullfinch Fund, Inc., 1370 Pittsford Mendon Road,
Mendon, New York 14506
Mailing address: 1370 Pittsford Mendon Road
Mendon, New York 14506
Registrant's telephone number, including area code: (585) 624-3150
Date of fiscal year end: 06/30/07
Date of reporting period: 07/01/06 - 6/30/07
Item 1 - Attach shareholder report
BULLFINCH FUND, INC.
1370 Pittsford Mendon Road
Mendon, New York 14506
(585) 624-3150
1-888-BULLFINCH
(1-888-285-5346)
Annual Report
June 30, 2007
Management's Discussion of Fund Performance
August 15, 2007
Dear Fellow Shareholders:
We are very proud to present the June 2007 Annual Report of the Bullfinch Fund,
Inc. This report contains the audited financial statements for both the
Unrestricted Series and the Greater Western New York Series.
The first half of 2007 has been very good to the shareholders of both Series of
the Bullfinch Fund. The Unrestricted Series benefitted from several buyouts of
stocks held in its portfolio in the first quarter. These buyouts helped preserve
the return during the tumultuous latter half of the quarter and provided ready
cash for buying as stocks dipped lower.
The Greater Western New York Series, on the other hand, saved its best for the
second quarter. After a flat first quarter, the Series rose significantly.
Indeed, according to the July 9, 2007 issue of Barron's, the Greater Western
New York Series "won top honors in the Multi-cap category" for the second
quarter. While past performance can never guarantee future results, we stand
proud of this designation. Helping us in the quarter was the buyout offer of
Bausch and Lomb, as well as steadily rising prices across the portfolio.
In both Series, we remained cautious, preserving an unusually large defensive
position as stock valuations exceeded what we felt represented good "Value"
investments. Despite this, we still achieved the outstanding overall portfolio
performance mentioned above. We felt, however, with the recent run-up in stock
prices, the overall market seemed poised to give back some of those returns.
In fact, as the last several weeks attest, this is precisely what the markets
have done.
The markets this summer appear to have responded quite unfavorably to the
simmering sub-prime problems. This has particularly hurt financial stocks. We
do have exposure to those stocks, but we belief the sub-prime exposure within
those companies is manageable. In addition, for a few days the street was rife
with worries regarding money market funds. Again, our research shows our
exposure to the sub-prime industry is quite small.
Overall, we feel both Series' portfolios are positioned well to weather any
near-term market storms, and possibly pick up some bargains during extreme
dips. We still maintain a healthy equity allocation that should benefit when
markets return to their strength.
We wish to thank our shareholders for expressing their confidence in us and
wish you continued good fortune in the coming year.
Best Regards,
Bullfinch Fund, Inc.
Christopher Carosa, CTFA
President
UNRESTRICTED SERIES
(A Series Within Bullfinch Fund, Inc.)
FINANCIAL STATEMENTS AS OF JUNE 30, 2007
TOGETHER WITH INDEPENDENT AUDITORS' REPORT
ROTENBERG & CO.
Certified Public Accountants
1870 Winton Road South
Suite 200
Rochester, NY 14618
Tel 585-295-2400
Fax 585-295-2150
INDEPENDENT AUDITORS' REPORT
To the Shareholders and Board of Directors of Bullfinch Fund, Inc.:
We have audited the accompanying statement of assets and liabilities of
Bullfinch Fund, Inc - Unrestricted Series (a series within the Bullfinch
Fund, Inc.), including the schedule of investments, as of June 30 2007, and
the related statements of operations, changes in net assets, and the
financial highlights for the years ended June 30, 2007, 2006 and 2005. These
financial statements and financial highlights are the responsibility of the
Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require
that we plan and perform the audits to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included confirmation
of securities owned as of June 30, 2007 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
Bullfinch Fund, Inc - Unrestricted Series (a series within the Bullfinch Fund,
Inc.) as of June 30, 2007, and the results of its operations, changes in net
assets, and its financial highlights for the years ended June 30, 2007, 2006,
and 2005 in conformity with accounting principles generally accepted in the
United States of America.
The financial highlights of the Unrestricted Series (a series within the
Bullfinch Fund Inc.) as of June 30, 2003 and 2002 were audited by other
auditors whose reports dated August 13, 2003 and August 15, 2002
respectively expressed an unqualified opinion on those statements.
/s/ Rotenberg & Company, LLP
Rotenberg & Company, LLP
Rochester, New York
August 20, 2007
UNRESTRICTED SERIES
(A SERIES WITHIN THE BULLFINCH FUND, INC.)
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 2007
ASSETS
Investments in Securities, at Fair Value,
Identified Cost of $2,927,692 $ 3,940,764
Cash 1,222,008
Accrued Interest and Dividends 7,843
Prepaid Expenses 9,059
------------
Total Assets $ 5,179,674
============
LIABILITIES AND NET ASSETS
LIABILITIES
Accrued Expenses $ 16,455
NET ASSETS
Net Assets (Equivalent to $14.81 per share based on
348,746.944 shares of stock outstanding) 5,163,219
------------
Total Liabilities and Net Assets $ 5,179,674
============
COMPOSITION OF NET ASSETS
Shares of Common Stock - Par Value $.01;
10,000,000 Shares Authorized,
348,746.944 Shares Outstanding $ 4,387,887
Accumulated Net Investment Loss (237,740)
Net Unrealized Appreciation on Investments 1,013,072
------------
Net Assets at June 30, 2007 $ 5,163,219
============
The accompanying notes are an integral part of these statements.
UNRESTRICTED SERIES
(A SERIES WITHIN BULLFINCH FUND, INC.)
SCHEDULE OF INVESTMENTS IN SECURITIES JUNE 30, 2007
Historical
Common Stocks - 100% Shares Cost Value
Medical Products and Supplies - 16.2%
Biomet Inc. 4,500 $ 146,143 $ 205,740
Johnson & Johnson 2,400 136,714 147,888
Medtronic Inc. 3,000 147,940 155,580
Polymedica Corporation 3,200 83,194 130,720
--------- ---------
513,991 639,928
Computers - Software - 13.9%
Microsoft Corp. 6,200 151,626 182,714
Oracle 11,000 119,262 216,810
Synopsis, Inc. 5,600 115,460 148,008
--------- ---------
386,348 547,532
Banking and Finance - 10.3%
Fiserv, Inc. 3,000 75,229 170,400
Fifth Third Bancorp 4,100 159,746 163,057
National City Corp. 2,200 55,431 73,304
--------- ---------
290,406 406,761
Electrical Equipment - 8.9%
Corning Inc. 7,300 71,366 186,515
General Electric Co. 4,300 125,562 164,604
--------- ---------
196,928 351,119
Oil & Related - 5.6%
Helmerich & Paine 6,200 153,229 219,604
Automotive - 5.1%
Gentex Corp. 10,300 147,681 202,807
Retail - Specialty - 4.9%
Fastenal Co. 4,600 160,394 192,556
Utilities - Natural Resources - 4.0%
Chesapeake Utilities Corp. 3,100 57,194 106,144
NiSource Inc. 2,500 46,325 51,775
--------- ---------
103,519 157,919
Retail - General - 4.0%
Fred's Inc. Class A 11,800 152,521 157,884
Historical
Common Stocks - 100% Shares Cost Value
Office Equipment - 3.8%
Xerox Corp. 8,000 118,582 147,840
Paper & Related Products - 3.7%
Avery Dennison Corp. 2,200 114,734 146,256
Computer - Networking - 2.7%
Cisco Systems, Inc. 3,800 55,371 105,830
Insurance - 2.6%
Gallagher Arthur J & Co. 3,700 99,355 103,156
Food & Beverages - 2.6%
Sensient Technologies 4,000 80,550 101,560
Pharmaceuticals -2.5%
Mylan Laboratories Inc. 5,400 110,246 98,226
Semiconductors - 2.5%
Intel Corp. 4,100 80,666 97,334
Instruments - 2.4%
Checkpoint Systems, Inc. 3,700 32,717 93,425
Computers - Hardware - 2.3%
Dell Corp. 3,250 66,364 92,787
Commercial Services, Inc. - 2.0%
Paychex, Inc. 2,000 64,090 78,240
Total Investments in Securities $ 2,927,692 $ 3,940,764
=========== ===========
The accompanying notes are an integral part of these statements.
UNRESTRICTED SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)
STATEMENTS OF OPERATIONS FOR THE YEARS ENDED JUNE 30, 2007, 2006 AND 2005
2007 2006 2005
---- ---- ----
INVESTMENT INCOME:
Dividends $ 120,940 $ 87,909 $ 70,818
EXPENSES:
Management fees 52,868 46,736 41,125
Legal and Professional 11,468 12,113 10,562
Director's Fees 1,200 1,200 1,200
D&O/E&O 5,129 11,340 4,482
Fidelity Bond 1,058 936 936
Taxes 472 518 455
Telephone 208 234 289
Registration Fees 1,137 969 1,134
Custodian Fees 2,772 2,751 2,107
Dues and Subscriptions 2,075 1,926 1,698
--------- --------- ---------
Total expense 78,387 78,723 63,988
--------- --------- ---------
Net investment income (loss) 42,553 9,186 6,830
--------- --------- ---------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Realized gain (loss)
from securities transactions 271,683 236,874 147,001
Unrealized appreciation (depreciation)
during the period 546,434 (197,111) (45,245)
--------- --------- ---------
Net gain (loss) on investments 818,117 39,763 101,756
--------- --------- ---------
INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $ 860,670 $ 48,949 $ 108,586
========== ========= =========
UNRESTRICTED SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)
STATEMENTS OF CHANGES IN NET ASSETS FOR THE
YEARS ENDED JUNE 30, 2007, 2006 AND 2005
2007 2006 2005
---- ---- ----
INCREASE IN NET ASSETS FROM OPERATIONS:
Net investment income (loss) $ 42,553 $ 9,186 $ 6,830
Net realized gain (loss)
from security transactions 271,683 236,874 147,001
Net change in unrealized appreciation
(depreciation) of investments 546,434 (197,111) (45,245)
--------- --------- ---------
Increase (decrease) in net assets
resulting from operations 860,670 48,949 108,586
CAPITAL SHARE TRANSACTION:
Sales 483,725 535,360 473,324
Redemptions (678,722) (181,377) (419,589)
--------- --------- ---------
Total capital share transactions (194,997) 353,983 53,735
--------- --------- ---------
Increase in net assets 665,673 402,932 162,321
NET ASSETS:
Beginning of period 4,497,546 4,094,614 3,932,293
--------- --------- ---------
End of period $5,163,219 $4,497,546 $4,094,614
The accompanying notes are an integral part of these statements.
UNRESTRICTED SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)
NOTES TO FINANCIAL STATEMENTS JUNE 30, 2007
NOTE A - SCOPE OF BUSINESS
The Unrestricted Series (the "Series") is a series within the Bullfinch Fund,
Inc. (the "Fund"), which was organized as a Maryland corporation registered
under the Investment Company Act of 1940 as an open-ended non-diversified
management investment company.
The investment objective of the Series is to seek conservative long-term
growth in capital. The Adviser seeks to achieve this objective by using an
asset mix consisting primarily of exchange listed securities and over-the-
counter common stocks as well as U.S. Government securities maturing within
five years.
NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Cash - Cash consists of amounts deposited in money market accounts and is not
federally insured. The Series has not experienced any losses on such amounts
and believes it is not exposed to any significant credit risk on cash.
Security Valuation - The Series records its investments at fair value.
Securities traded on national securities exchanges or the NASDAQ National
Market System are valued daily at the closing prices of the securities on
those exchanges and securities traded on over-the-counter markets are valued
daily at the closing bid prices. Short-term and money market securities are
valued at amortized cost, which approximates market value.
Income Taxes - It is the policy of the Fund to comply with the requirements of
Subchapter M of the Internal Revenue Code (the "Code") applicable to regulated
investment companies and to distribute all of its taxable income to its
shareholders. In addition, the Fund intends to distribute an amount sufficient
to avoid imposition of any excise tax under Section 4982 of the Code.
Therefore, no provision for federal income taxes or excise taxes has been made.
Distributions to Shareholders - Distributions to shareholders are recorded on
the ex-dividend date. The Series made a distribution of its long term capital
gains of $17,260 to its shareholders on December 28, 2004 in the form of stock
dividends equal to 1,137.790 shares of stock. The Series made a distribution
of its long term capital gains of $234,457 and ordinary income of $6,615 to its
shareholders on June 29, 2005 in the form of stock dividends equal to
17,183.492 shares of stock. The Series made a distribution of its long term
capital gains of $18,898 to its shareholders on December 28, 2005 in the form
of stock dividends equal to 1,338.392 shares of stock. The Series made a
distribution of its long term capital gains of $242,509 and ordinary income of
$9,254 to its shareholders on June 28, 2006 in the form of stock dividends
equal to 19,233.233 shares of stock. The Series made a distribution of its
long term capital gains of $125,765 and ordinary income of $24,454 to its
shareholders on December 27, 2006 in the form of stock dividends equal to
10,586.286 shares of stock. The Series made a distribution of its long term
capital gains of $74,306, its short term capital gains of $70,928 and
ordinary income of $17,901 to its shareholders on June 27, 2007 in the form
of stock dividends equal to 10,992.948 shares of stock.
Other - The Series follows industry practice and records security transactions
on the trade date. The specific identification method is used for determining
gains and losses for financial statement and income tax purposes. Dividend
income is recorded on the ex-dividend date and interest income is recorded on
the accrual basis.
Use of Estimates - The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the amounts reported in the financial statements
and accompanying notes. Actual results can differ from those estimates.
NOTE C - INVESTMENTS
For the year ended June 30, 2007, the Series purchased $1,524,478 of common
stock. During the same period, the Series sold $1,660,698 of common stock.
For the year ended June 30, 2006, the Series purchased $677,002 of common
stock. During the same period, the Series sold $1,369,364 of common stock.
For the year ended June 30, 2005, the Series purchased $853,288 of common
stock. During the same period, the Series sold $709,374 of common stock.
At June 30, 2007, the gross unrealized appreciation for all securities
totaled $1,025,092 and the gross unrealized depreciation for all securities
totaled $12,020, or a net unrealized appreciation of $1,013,072. The
aggregate cost of securities for federal income tax purposes at June 30, 2007
was $2,927,692.
At June 30, 2006, the gross unrealized appreciation for all securities
totaled $603,934 and the gross unrealized depreciation for all securities
totaled $137,296, or a net unrealized appreciation of $466,638. The
aggregate cost of securities for federal income tax purposes at June 30, 2006
was $2,792,229.
At June 30, 2005, the gross unrealized appreciation for all securities
totaled $828,871 and the gross unrealized depreciation for all securities
totaled $165,121, or a net unrealized appreciation of $663,750. The
aggregate cost of securities for federal income tax purposes at June 30, 2005
was $3,247,717.
NOTE D - INVESTMENT ADVISORY AGREEMENT
Carosa, Stanton & DePaolo Asset Management, LLC serves as investment advisor
to the Fund pursuant to an investment advisory agreement which was approved
by the Fund's board of directors. Carosa, Stanton & DePaolo Asset Management,
LLC is a Registered Investment Adviser under the Investment Advisers Act of
1940. The Investment advisory agreement provides that Carosa, Stanton &
DePaolo Asset Management, LLC, subject to the supervision and approval of
the Fund's board of directors, is responsible for the day-to-day management
of the Fund's portfolio, which includes selecting investments and handling
its business affairs.
As compensation for its services to the Fund, the investment advisor receives
monthly compensation at an annual rate of 1.25% on the first $1 million of
daily average net assets and 1% on that portion of the daily average net
assets in excess of $1 million. These fees will be reduced by any sub-transfer
agent fees incurred by the Fund.
Carosa, Stanton & DePaolo Asset Management, LLC has agreed to forego
sufficient investment advisory fees to limit total expenses of the Fund to
2% of the first $10 million in average assets and 1.5% of the next $20
million in average assets.
During the fiscal years ended June 30, 2007, 2006 and 2005, the fund paid
investment advisory fees of $52,868, $46,736 and $41,125, respectively.
On June 30, 2007, the fund had $4,515 included in accrued expenses, as
owed to Carosa, Stanton & DePaolo Asset Management, LLC.
NOTE E - CAPITAL SHARE TRANSACTIONS
The Fund has authorized 10,000,000 shares of common stock at $0.01 par value
per share. Each share has equal dividend, distribution and liquidation
rights. Transactions in capital stock of the Series were as follows:
Shares Amount
----------- -----------
Balance at June 30, 2004 271,338.635 $ 3,332,819
Shares sold during 2005 32,575.497 473,324
Shares Redeemed During 2005 (29,211.603) (419,589)
Reinvestment of Distributions, December 28, 2004 1,137.790 17,260
Reinvestment of Distributions, June 29, 2005 17,183.492 241,072
----------- -----------
Balance at June 30, 2005 293,023.811 $ 3,644,886
----------- -----------
Shares sold during 2006 37,416.865 535,360
Shares Redeemed During 2006 (12,537.319) (181,377)
Reinvestment of Distributions, December 28, 2005 1,338.392 18,898
Reinvestment of Distributions, June 28, 2006 19,233.233 251,763
----------- -----------
Balance at June 30, 2006 338,474.982 $ 4,269,530
=========== ===========
Shares sold during 2007 34,186.763 483,725
Shares Redeemed During 2007 (45,494.035) (678,722)
Reinvestment of Distributions, December 28, 2006 10,586.286 150,219
Reinvestment of Distributions, June 28, 2007 10,992.948 163,135
----------- -----------
Balance at June 30, 2007 348,746.944 $ 4,387,887
=========== ===========
UNRESTRICTED SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)
FINANCIAL HIGHLIGHTS (SUPPLEMENTAL DATA FOR A SHARE OUTSTANDING)
FOR THE YEARS ENDED JUNE 30, 2007, 2006, 2005, 2004, and 2003
2007 2006 2005 2004 2003
---- ---- ---- ---- ----
NET ASSET VALUE,
beginning of period $ 13.29 $ 13.97 $ 14.49 $ 12.69 $ 11.91
------- ------- ------- ------- -------
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) 0.12 0.03 0.02 (0.03) (0.06)
Net gain (loss) on securities
both realized and unrealized 0.49 (1.56) (1.47) 1.44 0.84
------- ------- ------- ------- -------
Total from investment
Operations 0.61 (1.53) (1.45) 1.41 0.78
------- ------- ------- ------- -------
DISTRIBUTIONS
Dividends 0.91 0.85 0.93 0.39 0.00
------- ------- ------- ------- -------
NET ASSET VALUE,
end of period $ 14.81 $ 13.29 $ 13.97 $ 14.49 $ 12.69
======= ======= ======= ======= =======
NET ASSETS,
end of period $5,163,219 $4,497,546 $4,094,614 $3,932,293 $2,538,036
Actual Actual Actual Actual Actual
------ ------ ------ ------ ------
RATIO OF EXPENSES
TO AVERAGE NET ASSETS* 1.6% 1.8% 1.6% 1.6% 1.7%
RATIO OF NET INVESTMENT INCOME
TO AVERAGE NET ASSETS* 0.9% 0.2% 0.2% (0.2)% (0.3)%
PORTFOLIO TURNOVER RATE* 30.4% 15.3% 18.2% 22.6% 7.5%
TOTAL RETURN 18.6% 1.3% 2.8% 17.4% 6.6%
* Per share amounts calculated using the average shares method
The accompanying notes are an integral part of these statements.
GREATER WESTERN NEW YORK SERIES (A Series Within Bullfinch Fund, Inc.)
FINANCIAL STATEMENTS AS OF JUNE 30, 2007
TOGETHER WITH INDEPENDENT AUDITORS' REPORT
ROTENBERG & CO.
Certified Public Accountants
1870 Winton Road South
Suite 200
Rochester, NY 14618
Tel 585-295-2400
Fax 585-295-2150
INDEPENDENT AUDITORS' REPORT
To the Shareholders and Board of Directors of Bullfinch Fund, Inc.:
We have audited the accompanying statement of assets and liabilities of
Bullfinch Fund, Inc - Greater Western New York Series (a series within the
Bullfinch Fund, Inc.), including the schedule of investments, as of June 30
2007, and the related statements of operations, changes in net assets, and
the financial highlights for the years ended June 30, 2007, 2006 and 2005.
These financial statements and financial highlights are the responsibility of
the Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require
that we plan and perform the audits to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included confirmation
of securities owned as of June 30, 2007 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
Bullfinch Fund, Inc - Greater Western New York Series (a series within the
Bullfinch Fund, Inc.) as of June 30, 2007, and the results of its
operations, changes in net assets, and its financial highlights for the
years ended June 30, 2007, 2006, and 2005 in conformity with accounting
principles generally accepted in the United States of America.
The financial highlights of the Western New York Series (a series within
the Bullfinch Fund Inc.) as of June 30, 2003 and 2002 were audited by
other auditors whose reports dated August 13, 2003 and August 15, 2002
respectively expressed an unqualified opinion on those statements.
/s/ Rotenberg & Company, LLP
Rotenberg & Company, LLP
Rochester, New York
August 20, 2007
GREATER WESTERN NEW YORK SERIES
(A SERIES WITHIN BULLFINCH FUND, INC.)
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 2007
ASSETS
Investments in securities, at fair value,
identified cost of $399,149 $ 637,947
Cash 90,226
Accrued interest and dividends 834
Prepaid expenses 1,952
Due from investment advisor 0
---------
Total assets $ 730,959
=========
LIABILITIES AND NET ASSETS
LIABILITIES
Accrued Expenses $ 3,398
NET ASSETS
Net assets (equivalent to $14.85 per share based
on 48,994.697 shares of stock outstanding) 727,561
---------
Total Liabilities and Net Assets $ 730,959
=========
COMPOSITION OF NET ASSETS
Shares of common Stock - Par Value $.01;
10,000,000 Shares Authorized,
48,994.697 Shares Outstanding $ 515,292
Accumulated net investment loss (26,529)
Net unrealized appreciation on investments 238,798
---------
Net assets at June 30, 2007 $ 727,561
=========
The accompanying notes are an integral part of these statements.
GREATER WESTERN NEW YORK SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)
SCHEDULE OF INVESTMENTS IN SECURITIES JUNE 30, 2007
Historical
Common Stocks - 100% Shares Cost Value
Medical Products & Supplies - 15.5%
Bausch & Lomb Inc. 600 $ 31,473 $ 41,664
Greatbatch Technologies 1,200 31,766 38,880
Johnson & Johnson 300 17,108 18,486
--------- ---------
80,347 99,030
Electrical Equipment - 10.9%
Corning, Inc. 1,000 7,874 25,550
General Electric Co. 550 15,917 21,054
Ultralife Batteries, Inc. 2,200 12,432 23,144
--------- ---------
36,223 69,748
Electronic Components - 7.7%
Astronics Corp. 1,431 7,065 45,391
IEC Electronics Corp. 2,000 1,530 3,680
--------- ---------
8,595 49,071
Real Estate & Related - 6.3%
Home Properties Inc. 400 16,297 20,772
Sovran Self Storage 400 15,241 19,264
--------- ---------
31,538 40,036
Retail - Specialty - 5.5%
Christopher & Banks Corp. 700 12,105 12,005
Fastenal Co. 550 19,186 23,023
--------- ---------
31,291 35,028
Metal Fabrication & Hardware - 5.3%
Graham Corp. 1,200 4,804 33,780
Commercial Services - 4.9%
Harris Interactive, Inc. 2,600 8,918 13,910
Paychex, Inc. 450 11,885 17,604
--------- ---------
20,803 31,514
Aerospace - 4.8%
Moog, Inc. Class A 337 2,926 14,865
Northrop Grumman 200 2,536 15,574
--------- ---------
5,462 30,439
Railroads - 4.2%
Genesee & Wyoming Class A 900 2,522 26,856
Computers - Software - 4.2%
Oracle 1,300 $ 16,642 $ 25,623
Veramark Tech, Inc. 1,050 6,181 840
--------- ---------
22,823 26,463
Photographic Equipment and Suppliers - 3.5%
Eastman Kodak 800 20,746 22,264
Historical
Common Stocks - 100% Shares Cost Value
Utilities - Natural Resources - 3.4%
National Fuel Gas Co. 500 11,250 21,655
Office Equipment - 3.2%
Xerox Corp. 1,100 18,571 20,328
Food & Beverages - 3.0%
Constellation Brands Inc. 800 5,017 19,424
Automotive - 2.9%
Monro Muffler Brake Inc. 500 9,880 18,725
Steel - 2.6%
Gilbraltar Industries Inc. 750 8,975 16,612
Computers - Services - 2.6%
Computer Task Group, Inc. 3,700 15,799 16,391
Computers - Distributors - 2.0%
Ingram Micro 600 10,909 13,026
Airlines - 2.0%
Southwest Airlines Co. 850 15,105 12,674
Computers - Hardware - 1.6%
Dell Corporation 350 10,734 9,993
Computers - Networking - 1.6%
Performance Technologies, Inc. 2,200 18,032 9,900
Packaging and Containers - 1.1%
Mod Pac Corporation 715 3,461 7,300
Health Care Service Provider -0.5%
VirtualScopics Inc. 2,000 2,981 3,400
Machinery - 0.5%
Columbus McKinnon Corp. 100 2,344 3,220
Industrial Materials - 0.2%
Servotronics, Inc. 100 937 1,070
--------- ---------
Total Investments in Securities $ 399,149 $ 637,947
========= =========
The accompanying notes are an integral part of these statements.
GREATER WESTERN NEW YORK SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)
STATEMENTS OF OPERATIONS FOR THE YEARS ENDED JUNE 30, 2007, 2006, AND 2005
2007 2006 2005
---- ---- ----
INVESTMENT INCOME:
Dividends $ 9,665 $ 8,146 $ 5,710
EXPENSES:
Management fees 8,117 7,292 6,265
Reimbursement of Management Fees (1,000) (2,520) (1,302)
Legal and Professional 1,384 1,515 1,224
Director's Fees 1,200 1,200 1,200
D&O/E&O 522 1,260 498
Fidelity Bond 117 104 104
Taxes 454 450 433
Telephone 208 234 289
Registration Fees 418 418 200
Custodian Fees 224 186 99
Dues and Subscriptions 1,275 1,126 898
--------- --------- ---------
Total expense 12,919 11,265 9,908
Net investment income (loss) (3,254) (3,119) (4,198)
--------- --------- ---------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Realized gain (loss)
from securities transactions 3,805 37,655 (155)
Unrealized appreciation (depreciation)
during the period 80,397 23,218 32,113
--------- --------- ---------
Net gain (loss) on investments 84,202 60,873 31,958
--------- --------- ---------
INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $ 80,948 $ 57,754 $ 27,760
========= ========= =========
GREATER WESTERN NEW YORK SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED JUNE 30, 2007, 2006, AND 2005
2007 2006 2005
---- ---- ----
DECREASE IN NET ASSETS FROM OPERATIONS:
Net investment income (loss) $ (3,254) $ (3,119) $ (4,198)
Net realized gain (loss)
from security transactions 3,805 37,655 (155)
Net change in unrealized appreciation
(depreciation) of investments 80,397 23,218 32,113
--------- --------- ---------
Increase (decrease) in net assets
resulting from operations 80,948 57,754 27,760
CAPITAL SHARE TRANSACTIONS:
Sales 15,512 28,003 34,779
Redemptions - (2,907) (4,870)
--------- --------- ---------
Total capital share transactions 15,512 25,096 29,909
--------- --------- ---------
Increase in net assets 96,460 82,850 57,669
NET ASSETS:
Beginning of period 631,101 548,251 490,582
--------- --------- ---------
End of period $ 727,561 $ 631,101 $ 548,251
========= ========= =========
The accompanying notes are an integral part of these statements.
GREATER WESTERN NEW YORK SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)
NOTES TO FINANCIAL STATEMENTS JUNE 30, 2007
NOTE A - SCOPE OF BUSINESS
The Greater Western New York Series (the "Series") is a series within the
Bullfinch Fund, Inc. (the "Fund"), which was organized as a Maryland
corporation registered under the Investment Company Act of 1940 as an
open-ended non-diversified management investment company.
The investment objective of the Series is to seek capital appreciation
through the investment in common stock of companies with an important
economic presence in the Greater Western New York Region. The Adviser seeks
to achieve this objective by using an asset mix consisting primarily of
exchange listed securities and over-the-counter common stocks as well as
U.S. Government securities maturing within five years.
NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Cash - Cash consists of amounts deposited in money market accounts and is
not federally insured. The Series has not experienced any losses on such
amounts and believes it is not exposed to any significant credit risk on cash.
Security Valuation - The Series records its investments at fair value.
Securities traded on national securities exchanges or the NASDAQ National
Market System are valued daily at the closing prices of the securities on
those exchanges and securities traded on over-the-counter markets are valued
daily at the closing bid prices. Short-term and money market securities are
valued at amortized cost, which approximates market value.
Income Taxes - It is the policy of the Fund to comply with the requirements of
Subchapter M of the Internal Revenue Code (the "Code") applicable to regulated
investment companies and to distribute all of its taxable income to its
shareholders. In addition, the Fund intends to distribute an amount sufficient
to avoid imposition of any excise tax under Section 4982 of the Code.
Therefore, no provision for federal income taxes or excise taxes has been made.
Distributions to Shareholders - Distributions to shareholders are recorded on
the ex-dividend date. The Series made a distribution of its long-term capital
gains of $42,105 to its shareholders on June 28, 2006, in the form of stock
dividends equal to 3,243.841 shares of stock. The Series made a distribution
of its long-term capital gains of $3,850 to its shareholders on December 27,
2006, in the form of stock dividends equal to 286.269 shares of stock. There
were no distributions made during the fiscal year ended June 30, 2005.
Other - The Series follows industry practice and records security transactions
on the trade date. The specific identification method is used for determining
gains and losses for financial statement and income tax purposes. Dividend
income is recorded on the ex-dividend date and interest income is recorded on
the accrual basis.
Use of Estimates - The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the amounts reported in the financial statements
and accompanying notes. Actual results can differ from those estimates.
NOTE C - INVESTMENTS
For the year ended June 30, 2007, the Series purchased $54,739 of common stock.
During the same period, the Series sold $32,472 of common stock.
For the year ended June 30, 2006, the Series purchased $92,681 of common stock.
During the same period, the Series sold $94,535 of common stock.
For the year ended June 30, 2005, the Series purchased $54,053 of common stock.
During the same period, the Series sold $23,356 of common stock.
At June 30, 2007, the gross unrealized appreciation for all securities totaled
$255,545 and the gross unrealized depreciation for all securities totaled
$16,747, or a net unrealized appreciation of $238,798. The aggregate cost of
securities for federal income tax purposes at June 30, 2007 was $399,149.
At June 30, 2006, the gross unrealized appreciation for all securities totaled
$185,791 and the gross unrealized depreciation for all securities totaled
$27,391, or a net unrealized appreciation of $158,400. The aggregate cost of
securities for federal income tax purposes at June 30, 2006 was $373,078.
At June 30, 2005, the gross unrealized appreciation for all securities totaled
$176,655 and the gross unrealized depreciation for all securities totaled
$41,472, or a net unrealized appreciation of $135,183. The aggregate cost of
securities for federal income tax purposes at June 30, 2005 was $337,278.
NOTE D - INVESTMENT ADVISORY AGREEMENT
Carosa, Stanton & DePaolo Asset Management, LLC serves as investment advisor
to the Fund pursuant to an investment advisory agreement which was approved
by the Fund's board of directors. Carosa, Stanton & DePaolo Asset Management,
LLC is a Registered Investment Adviser under the Investment Advisers Act of
1940. The Investment advisory agreement provides that Carosa, Stanton &
DePaolo Asset Management, LLC, subject to the supervision and approval of
the Fund's board of directors, is responsible for the day-to-day management
of the Fund's portfolio, which includes selecting investments and handling
its business affairs.
As compensation for its services to the Fund, the investment advisor receives
monthly compensation at an annual rate of 1.25% on the first $1 million of
daily average net assets and 1% on that portion of the daily average net
assets in excess of $1 million. These fees will be reduced by any sub-transfer
agent fees incurred by the Fund.
Carosa, Stanton & DePaolo Asset Management, LLC has agreed to forego
sufficient investment advisory fees to limit total expenses of the Fund to 2%
of the first $10 million in average assets and 1.5% of the next $20 million
in average assets.
During the fiscal years ended June 30, 2007, 2006 and 2005, the fund paid
investment advisory fees of $7,117, $4,772 and $4,963, respectively.
On June 30, 2007, the fund had $738 included in accrued expenses, as owed to
Carosa, Stanton and DePaolo Asset Management, LLC.
NOTE E - CAPITAL SHARE TRANSACTIONS
The Fund has authorized 10,000,000 shares of common stock at $0.01 par value
per share. Each share has equal dividend, distribution and liquidation rights.
Transactions in capital stock of the Series were as follows:
Shares Amount
----------- -----------
Balance at June 30, 2004 40,155.482 $ 398,820
----------- -----------
Shares sold during 2005 2,801.149 34,779
Shares redeemed during 2005 (382.933) (4,870)
----------- -----------
Balance at June 30, 2005 42,573.698 $ 428,729
----------- -----------
Shares sold during 2006 1,951.828 28,003
Shares redeemed during 2006 (204.415) (2,907)
Reinvestment of Distributions, June 28, 2006 3,243.841 42,105
----------- -----------
Balance at June 30, 2006 47,564.952 $ 495,930
----------- -----------
Shares sold during 2007 1,143.476 15,512
Shares redeemed during 2007 - -
Reinvestment of Distributions, December 27, 2006 286.269 3,850
----------- -----------
Balance at June 30, 2007 48,994.697 $ 515,292
=========== ===========
GREATER WESTERN NEW YORK SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)
FINANCIAL HIGHLIGHTS (SUPPLEMENTAL DATA FOR A SHARE OUTSTANDING)
FOR THE YEARS ENDED JUNE 30, 2007, 2006, 2005, 2004, and 2003
2007 2006 2005 2004 2003
---- ---- ---- ---- ----
NET ASSET VALUE,
beginning of period $ 13.27 $ 12.88 $ 12.22 $ 9.80 $ 9.19
------- ------- ------- ------- -------
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (0.07) (0.07) (0.10) (0.11) (0.03)
Net gain (loss) on securities
Both realized and unrealized 1.57 (0.49) 0.76 2.53 0.64
------- ------- ------- ------- -------
Total from investment
Operations 1.50 (0.56) 0.66 2.42 0.61
DISTRIBUTIONS
Dividends .08 .95 - - -
------- ------- ------- ------- -------
NET ASSET VALUE,
end of period $ 14.85 $ 13.27 $ 12.88 $ 12.22 $ 9.80
======= ======= ======= ======= =======
NET ASSETS, end of period $727,561 $631,101 $548,251 $490,582 $367,320
======== ======== ======== ======== ========
Actual Actual Actual Actual Actual
------ ------ ------ ------ ------
RATIO OF EXPENSES TO
AVERAGE NET ASSETS* 2.0% 1.9% 2.0% 2.0% 1.6%
RATIO OF EXPENSES TO AVERAGE NET ASSETS
BEFORE REIMBURSEMENT* 2.1% 2.4% 2.2% 2.4% 2.3%
RATIO OF NET INVESTMENT INCOME
TO AVERAGE NET ASSETS* (0.5)% (0.5)% (0.8)% (1.0)% 0.0%
PORTFOLIO TURNOVER RATE* 5.0% 15.8% 4.6% 11.3% 7.7%
TOTAL RETURN 12.5% 10.6% 5.4% 24.7% 6.6%
* Per share amounts calculated using the average shares method
The accompanying notes are an integral part of these statements.
ADDITIONAL INFORMATION
EXPENSE TABLE Beginning Ending
Account Value Account Value Annualized Expenses Paid
ACTUAL 1/1/07 6/30/07 Expense Ratio During Period+
Unrestricted Series $ 1,000.00 $ 1,083.77 1.6% $ 8.27
Greater Western
New York Series 1,000.00 1,113.19 2.0% $ 10.48
HYPOTHETICAL++
Unrestricted Series 1,000.00 1,025.00 1.6% $ 8.03
Greater Western
New York Series 1,000.00 1,025.00 2.0% $ 10.04
+ Expenses are equal to each Series' annualized expense ratio multiplied
by the average account value over the period, multiplied by the number of days
(181) in the most recent fiscal half-year, then divided by 365.
++ Assumes annual return of 5% before expenses.
All mutual funds have operating expenses. As a shareholder of the Fund, you
incur operating expenses including investment advisory fees, regulatory fees
and other Fund expenses. Such expenses, which are deducted from the Fund's
gross income, directly reduce the investment return of the Fund. The Fund's
expenses are expressed as a percentage of its average net assets. This figure
is known as the expense ratio. The Expense Table is intended to help you
understand the ongoing costs (in dollars) of investing in your Fund and to
compare these costs with those of other mutual funds. The examples are based
on an investment of $1,000 made at the beginning of the period shown and held
for the entire period (January 1, 2007 to June 30, 2007).
The Expense Table illustrates your Fund's costs in two ways.
* ACTUAL EXPENSES. This section helps you to estimate the actual expenses
after fee waivers that you paid over the period. The "Ending Account Value"
shown is derived from the Fund's actual return, and "Expenses Paid During
Period" shows the dollar amount that would have been paid by an investor who
started with $1,000 in the Fund.
* HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES. This section is intended to
help you compare your Fund's costs with those of other mutual funds. It is
based on your Fund's actual expense ratio and assumes that your Fund had an
annual return of 5% before expenses during the period shown. In this case -
because the return used is not your Fund's actual return - the results may
not be used to estimate your actual ending account value or expenses you paid
during this period. The example is useful in making comparisons between your
Fund and other funds because the Securities and Exchange Commission (the
"SEC") requires all mutual funds to calculate expenses based on an annual
5% return. You can assess your Fund's costs by comparing this hypothetical
example with the hypothetical examples that appear in shareholder reports
of other funds.
BOARD OF DIRECTORS INFORMATION
The business and affairs of the Fund are managed under the direction of the
Fund's Board of Directors. Information pertaining to the Directors of the
Fund are set forth below. The Fund's SAI includes additional information
about the Fund's Directors, and is available without charge, by calling
(585) 624-3150 or 1-888-BULLFINCH. Each director may be contacted by writing
to the director c/o Bullfinch Fund, Inc. 1370 Pittsford Mendon Road, Mendon,
New York 14506
The directors and officers of the Fund are:
<Table>
NAME, AGE POSITON(S) TERM OF OFFICE PRINCIPLE NUMBER OF OTHER
ADDRESS HELD WITH AND LENGTH OF OCCUPATION(S) PORTFOLIOS DIRECTORSHIPS
FUND TIME SERVED DURING PAST IN FUND HELD BY
5 YEARS COMPLEX DIRECTOR
OVERSEEN BY
DIRECTOR
- -----------------------------------------------------------------------------------------------------
INTERESTED PERSONS
Christopher Carosa, 47 President; Term of Office: President, Founder 2 N/A
2 Lantern Lane Director; N/A Carosa, Stanton &
Honeoye Falls, Chairman of Length of Time DePaolo Asset
New York 14472 Board; Chief Served: Management, LLC;
Compliance Since 1997 President, Director
Officer and Chairman of the
Board, Bullfinch Fund, Inc.
Gordon Stanton, 48 Vice-President; Term of Office: Vice-President, Founder 2 N/A
17 East 96 St. Director; N/A Carosa, Stanton &
Apt 7C Length of Time DePaolo Asset
New York, Served: Management, LLC;
NY 10128 Since 1997 Vice-President,
and Director,
Bullfinch Fund, Inc.;
Associate, Brown Harris
Stevens Residential
Terrance B. Mulhern, 45 Vice-President Term of Office: Executive Vice-President 2 N/A
169 Church Street N/A Carosa, Stanton &
Victor, Length of Time DePaolo Asset
NY 14564 Served: Management, LLC;
Since 2003 Vice-President,
Bullfinch Fund, Inc.;
Senior Vice-President,
Clover Capital;
Bradford L. McAdam, 51 Vice-President Term of Office: Vice-President 2 N/A
7109 Chili-Riga Ctr Rd N/A Carosa, Stanton &
Churchville, Length of Time DePaolo Asset
NY 14428 Served: Management, LLC;
Since 1998 Vice-President,
Bullfinch Fund, Inc.
Thomas S. Carroll, 47 Vice-President Term of Office: Vice-President 2 N/A
47 Chippenham Drive N/A Carosa, Stanton &
Penfield, Length of Time DePaolo Asset
NY 14526 Served: Management, LLC;
Since 2005 Vice-President,
Bullfinch Fund, Inc.
Manager, Studio Sales
Pottery Supply
Betsy Kay Carosa, 47 Corporate Term of Office: Office Manager 2 N/A
2 Lantern Lane Secretary N/A Carosa, Stanton &
Honeoye Falls, Length of Time DePaolo Asset
NY 14472 Served: Management, LLC;
Since 1997 Corporate Secretary,
Bullfinch Fund, Inc.
</Table>
INDEPENDENT DIRECTORS
<Table>
Thomas M. Doeblin, 48 Director;Audit Term of Office: Teacher 2 N/A
73 San Gabriel Drive Committee N/A Pittsford Mendon HS
Rochester Length of Time
NY, 14610 Served:
Since 2006
John P. Lamberton, 47 Director Term of Office: Founder, General Partner 2 N/A
143-49 38th Ave, 3rd Floor N/A Cape Bojador Capital
Flushing, Length of Time Management; Managing
NY 11354 Served: Director, HSBC
Since 2003 Securities
William E.J. Martin, 47 Director Term of Office: Director of Sales 2 N/A
4410 Woodlawn Ave. N N/A Aecon Buildings, Inc.;
Seattle, Length of Time Project Manager,
WA 98103 Served: American Home Builders;
Since 1997 Senior Project Manager,
Mego Construction
Michael J. Morris, 46 Director Term of Office: Actuary 2 N/A
72 Lovely Street Audit N/A United Healthcare
Unionville, Committee Length of Time
CT 06085 Served:
Since 1997
Lois Niland, 55 Director Term of Office: Marketing Consultant 2 N/A
33 Oak Meadow Trail N/A VP Sales & Marketing,
Pittsford, Length of Time Complemar Partners
NY 14534 Served: President, Icon Design
Since 2006 General Manager, Xerox
Michael W. Reynolds, 47 Director Term of Office: Vice-President 2 N/A
105 Dorchester Road Audit N/A Quinlan & Company
Buffalo, Committee Length of Time
NY 14213 Served:
Since 2000
</Table>
PROXY VOTING GUIDELINES
Carosa, Stanton & DePaolo Asset Management, LLC, the Fund's Investment Adviser,
is responsible for exercising the voting rights associated with the securities
held by the Fund. A description of the policies and procedures used by the
Adviser in fulfilling this responsibility is available without charge, upon
request, by calling (555) 624-3150 or 1-888-BULLFINCH.
QUARTERLY FILING OF PORTFOLIO HOLDINGS
The Fund files its complete schedule of portfolio holdings with the Securities
and Exchange Commission (SEC) for the first and third quarters of each fiscal
year on Form N-Q. The Fund's Forms N-Q are available on the SEC's website at
http://www.sec.gov. The Fund's Forms N-Q may also be reviewed and copied at
the SEC's Public Reference Room in Washington DC. Information on the operation
of the Public Reference Room may be obtained by calling 1-800-SEC-0330.
DISCLOSURE REGARDING THE BOARD OF DIRECTORS' APPROVAL
OF THE INVESTMENT ADVISORY CONTRACT
At the Board's Annual Meeting, the independent directors of the Board met
separately to discuss the Adviser and reported the conclusions to the Board.
In determining whether to renew the Management and Investment Advisory
Agreements between the Fund and Carosa, Stanton & DePaolo Asset Management,
LLC, (the Adviser), the Board of Directors requested, and the Adviser provided
information relevant to the Board's consideration. Among the factors the Board
considered were:
1. Nature, extent and quality of service provided by the Adviser - the
independent directors discussed several factors. They noted the to-date
unlimited access the Adviser has provided the independent directors, as
evidenced by the frequent phone calls and meetings between various directors
and Adviser principals and officers, and the periodic visits of various
directors to the Adviser's office. To the best of the independent directors'
knowledge and experience, this level of access compares very favorably with
that of other mutual fund managers. The independent directors also noted that
the Adviser has been consistent in maintaining the investment style that the
Adviser was hired to provide for the Bullfinch Fund Series and that Bullfinch
Fund investors expect, as detailed in the Bullfinch Fund prospectus.;
2. The overall performance of the Series' relative to the performance of other
funds in the Funds' peer group and its benchmark - the independent directors
noted that under the Adviser's management, both the Bullfinch Fund Unrestricted
Series and the Greater Western New York Series have outperformed their indices
since inception, 2007 year-to-date, 2nd quarter 2007. The independent directors
also noted that the Greater Western New York Series has recently been one of
the top-performing funds in its class.
3. The cost of Adviser services and the profits realized by the Adviser - the
independent directors noted the Adviser has had a viable private money
management business for over a decade, and that the profits the Adviser makes
from that business subsidize the Adviser's management of the Bullfinch Fund
Series. The independent directors also noted that the amount of private
monies managed by the Adviser dwarfs the amount of monies in the Bullfinch
Fund Series. The independent directors therefore see no issue with either
the Adviser's overall costs or profits.
4. Extent to which economies of scale would be realized as a fund group - the
independent directors noted that significant economies of scale would be
realized if the Bullfinch Fund Series' grow, and agreed that growing the
Bullfinch Fund Series' should be a priority, within the limitations of
available resources.
5. Do fee levels reflect economies of scale for the benefit of fund
investors? - the independent directors agreed that the Adviser's fee schedule
does reflect economies of scale that Bullfinch Fund shareholders would
benefit from as the series grows, as indicated by the breakpoints in the fee
schedule.
6. Is it worthwhile to compare the Adviser's fee to the fees other money
managers charge to manage similar funds - as the fees the Adviser charges
have not had a meaningful impact on the relative performance of the Bullfinch
Fund series, the independent directors did not compare the Adviser's fees
to other managers. In addition, the independent directors noted how the lack
of sales charges or Rule 12b-1 fees, or soft dollar arrangements, was
reasonable and fair to Bullfinch Fund shareholders.
7. For the above comparison of fees and services, the board relied on
material provided by the adviser, and, because much of this material came
from third party sources, the board did not obtain information independent
of the investment adviser.
Based upon their review and consideration of these factors and other
matters deemed relevant, the Board concluded that the terms of the
Investment Management Agreements are fair and reasonable and the Board
voted to renew the Agreements.
Item 2 - CODE OF ETHICS.
(a) The registrant has adopted a code of ethics that applies to the
registrant's principal executive officer, its principal financial
officer, principal accounting officer, controller, as well as
any other officers and persons providing similar functions. This
code of ethics is included as Exhibit 11(a)(1).
(b) During the period covered by this report, no amendments were made to
the provisions of the code of ethics
(c) During the period covered by this report, no implicit or explicit
waivers to the provisions of the code of ethics were granted.
Item 3 - AUDIT COMMITTEE FINANCIAL EXPERT.
The registrant's Board of Directors determined that the registrant
does not have an Audit Committee member who possesses all of the
attributes required to be an "audit committee financial expert" as
defined in instruction 2(b) of Item 3 of Form N-CSR. It was the
consensus of the board that, although no one individual Audit
Committee member meets the technical definition of an audit
committee financial expert, the Committee has sufficient expertise
collectively among its members to effectively discharge its duties
and that the Committee will engage additional expertise if needed.
Item 4 - PRINCIPAL ACCOUNTANT FEES AND SERVICES.
The registrant has engaged its principal accountant to perform
audit services. "Audit services" refer to performing an audit of
the registrant's annual financial statements or services that are
normally provided by the accountant in connection with statutory
and regulatory filings or engagements for those fiscal years.
"Audit-related services" refer to the assurance and related
services by the principal accountant that are reasonably related
to the performance of the audit. "Tax services" refer to
professional services rendered by the principal accountant for tax
compliance, tax advice, and tax planning. The following table
details the aggregate fees billed for each of the last two fiscal
years for audit fees, audit-related fees, tax fees and other fees
by the principal accountant. Since the accounting fees were
approved by the Board of Directors in total, the principal
accountant has provided an estimate of the split between audit and
preparation of the tax filings.
06/30/2007 06/30/2006
Audit Fees $9,600 $9,000
Audit-Related Fees $ 0 $ 0
Tax Fees $2,000 $2,000
All Other Fees $ 0 $ 0
The Audit Committee of the registrant's Board of Directors
recommends a principal accountant to perform audit services for
the registrant. Each year, the registrant's Board of Directors
vote to approve or disapprove the principal accountant recommended
by the Audit Committee for the following year's accounting work.
Item 5 - AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable to open-end investment companies.
Item 6 - Reserved
Item 7 - DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable to open-end investment companies.
Item 8 - PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANIES.
Not applicable to open-end investment companies.
ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
None.
Item 10(a) -The registrant's principal executive and principal financial
officer has determined that the registrant's disclosure controls
and procedures (as defined in Rule 30a-3(c) under the Investment
Company Act of 1940) are effective based on the evaluation of
these controls and procedures are effective as of a date within 90
days prior to the filing date of this report.
Item 10(b) -There were no changes in the registrant's internal control
over financial reporting (as defined in Rule 30a-3(d) under the
Investment Company Act of 1940) that occurred during the
registrant's last fiscal half-year (the registrant's second fiscal
half-year in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting.
Item 11 - EXHIBITS.
(a)(1) Code of Ethics - referred to in Item 2 is attached hereto.
(a)(2) Certifications pursuant to Section 302 of the Sarbanes-
Oxley Act of 2002 are attached hereto.
(b) Certifications pursuant to Section 906 of the Sarbanes-
Oxley Act of 2002 are attached hereto.
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.
Bullfinch Fund, Inc.
By: /s/ Christopher Carosa
----------------------------------------
Christopher Carosa,
President of Bullfinch Fund, Inc.
Date: August 15, 2007
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/ Christopher Carosa
----------------------------------------
Christopher Carosa,
President of Bullfinch Fund, Inc.
Date: August 15, 2007