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: 3909 Rush Mendon Road
Mendon, New York 14506
Name and address of agent for service: Christopher Carosa, President,
Bullfinch Fund, Inc., 3909 Rush Mendon Road,
Mendon, New York 14506
Mailing address: 3909 Rush Mendon Road
Mendon, New York 14506
Registrant's telephone number, including area code: (585) 624-3150
Date of fiscal year end: October 31
Date of reporting period: 11/01/09 - 04/30/10
Item 1 - Attach shareholder report
BULLFINCH FUND, INC.
3909 Rush Mendon Road
Mendon, New York 14506
(585) 624-3150
1-888-BULLFINCH
(1-888-285-5346)
Semi-Annual Report
April 30, 2010
Management's Discussion of Fund Performance
June 25, 2008
Dear Fellow Shareholders:
We are very proud to present the April 2010 Semi-Annual Report of Bullfinch
Fund, Inc. This report contains the unaudited financial statements for both
the Unrestricted Series and the Greater Western New York Series.
We've had a very exciting year these last twelve months as we find both
Bullfinch funds once again at the top of the heap, ranked highly against their
national peers. At one point in April, Wall Street Journal/Lipper reported
both funds appeared in the national top ten ranking.
We can now reveal how we achieved this: The market, as measured by the S&P 500,
has remained essentially flat since November. Both Bullfinch funds saw
accelerated double-digit growth. In the six months ending April 30, 2010, the
Unrestricted Series returned 16.17% and the Greater Western New York Series
returned 18.74%.
While past performance can never guarantee future results, most of our success
appears to have come from two actions. First, we didn't give up on some of our
older individual positions last year when they lagged the broader markets. In
the last six months, we saw Fastenal and Tyco rise by more than 50%. One stock,
Carpenter, more than doubled by the time we sold it. In the Greater Western New
York Series, besides Fastenal and Tyco, Astronics, Kodak, Moog, Southwest and
Xerox returned 50% or more. Mod-Pac nearly doubled. In both Series, these
greater returns came from a variety of industries. Additionally, of the four
new stocks added to the portfolio, three produced double digit returns and the
fourth performed on par with the market. On the negative side, only two stocks
- - both in the Unrestricted Series - yielded negative returns. Chesapeake
Utilities fell back just under 3% (it continues to yield more than 4% through
its dividend, though). On the other hand, the good news is Meridian Bioscience
took a dive right at the end of the reporting period. This is good news because
of the reason for the drop. The Swine Flu "epidemic" petered out and the need
for Meridian's vaccine died away. We view this as a short-term setback for the
company. In the Greater Western New York Series, the worst performing stocks
all met or exceeded the S&P 500. Again, these results appeared across all
industries.
One of the advantages we have had in our funds, especially the Unrestricted
Series, is the relative lack of financial stocks. While this hurt us when the
market rebounded in the second quarter of 2009, the increased volatility of
those stocks as Congress debates the financial regulation reform is one reason
the market has been flat while we have continued to grow. The Greater Western
New York Series does hold two financial stocks and has been more volatile than
the Unrestricted Series as a result.
This leads us to perhaps the greatest near-term risk - and opportunity.
Washington is in a changing mood, and we've continued to see several
apparently major pieces of legislation passed. Many analysts fear these bills,
in their raw form, might impede economic growth. It remains to be seen if
Congressional reconciliation and final regulatory implantation might dilute
some of the more draconian measures. Still, the market peaked just about the
time Health Care reform passed and accelerated down during the debate leading
to the financial regulation bill. One thing to remember, the political stars
may be lining up for a repeat of 1994, when Republicans surprisingly captured
both houses. In the weeks immediately after that, the market soared more
than 10%.
We wish to thank our shareholders for expressing their confidence in us and
wish you continued good fortune.
Best Regards,
Bullfinch Fund, Inc.
Christopher Carosa, CTFA
President
BULLFINCH FUND, INC.
PERFORMANCE SUMMARY
The graph below represents the changes in value for an initial $10,000
investment in the BULLFINCH Fund from 7/1/98 to 4/30/10. These changes are
then compared to a $10,000 investment in the Value Line Geometric Index,
The Value Line Geometric Index (VLG) is an unmanaged index of between 1,600
and 1,700 stocks. Value Line states "The VLG was intended to provide a rough
approximation of how the median stock in the Value Line Universe performed.
The VLG also has appeal to institutional investors as a proxy for the so-called
'multi-cap' market because it includes large cap, mid cap and small cap stocks
alike." The Fund's returns include the reinvestment of all dividends, but do
not reflect the deduction of taxes that a shareholder would pay on fund
distributions or the redemptions of fund shares. Past performance is not
predictive of future performance. Investment return and principal value
will fluctuate, so that your shares, when redeemed, may be worth more or less
than the original cost.
(GRAPH OMITTED)
Year Bullfinch Fund, Inc. Value Line
Ending Unrestricted Series Geometric Index
$10,000 $10,000
6/30/2000 $10,346 $9,128
6/30/2000 $12,027 $8,950
6/30/2002 $10,885 $7,260
6/30/2003 $11,598 $6,620
6/30/2004 $13,610 $8,435
6/30/2005 $13,990 $8,842
6/30/2006 $14,172 $9,470
6/30/2007 $16,801 $11,048
6/30/2008 $15,037 $8,326
10/31/2008 $12,410 $5,745
10/31/2009 $13,121 $6,293
4/30/2010 $15,243 $7,821
Annualized
Returns
Ending Bullfinch Fund, Inc. Value Line
4/30/2010 Unrestricted Series Geometric Index
One-Year +28.42% +49.50%
Five-Year + 3.71% - 0.97%
Ten-Year + 4.13% - 2.02%
(GRAPH OMITTED)
Year Bullfinch Fund, Inc. Value Line
Ending Greater Western New York Series Geometric Index
$10,000 $10,000
6/30/2000 $9,735 $9,128
6/30/2001 $10,043 $8,950
6/30/2002 $9,120 $7,260
6/30/2003 $9,725 $6,620
6/30/2004 $12,127 $8,435
6/30/2005 $12,782 $8,842
6/30/2006 $14,132 $9,470
6/30/2007 $15,903 $11,048
6/30/2008 $14,283 $8,326
10/31/2008 $12,191 $5,745
10/31/2009 $11,770 $6,293
4/30/2010 $13,976 $7,821
Annualized
Returns
Ending Bullfinch Fund, Inc. Value Line
4/30/2010 Greater Western New York Series Geometric Index
One-Year +39.46% +49.50%
Five-Year - 4.79% - 0.97%
Ten-Year + 4.53% - 2.02%
UNRESTRICTED SERIES
(A Series Within Bullfinch Fund, Inc.)
FINANCIAL STATEMENTS AS OF APRIL 30, 2010
(UNAUDITED)
UNRESTRICTED SERIES
(A SERIES WITHIN THE BULLFINCH FUND, INC.)
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 2010 (UNAUDITED)
ASSETS
Investments in Securities, at Fair Value,
Identified Cost of $3,569,648 $ 4,356,042
Cash 268,074
Accrued Interest and Dividends 3,593
Prepaid Expenses 1,860
------------
Total Assets $ 4,629,569
============
LIABILITIES AND NET ASSETS
LIABILITIES
Accrued Expenses $ 9,642
NET ASSETS
Net Assets (Equivalent to $13.51 per share
based on 341,992.263 shares of stock outstanding) 4,619,927
------------
Total Liabilities and Net Assets $ 4,629,569
============
COMPOSITION OF NET ASSETS
Shares of Common Stock - Par Value $.01;
10,000,000 Shares Authorized,
341,992.263 Shares Outstanding $ 4,384,384
Accumulated Net Investment Loss (550,851)
------------
Net Unrealized Depreciation on Investments 786,394
============
Net Assets at April 30, 2010 $ 4,619,927
The accompanying notes are an integral part of these statements.
UNRESTRICTED SERIES
(A SERIES WITHIN BULLFINCH FUND, INC.)
SCHEDULE OF INVESTMENTS IN SECURITIES APRIL 30, 2010
(UNAUDITED)
Historical
Common Stocks - 100% Shares Cost Value
Computers - Software - 9.91%
Microsoft Corp. 6,200 $ 151,626 $ 189,317
Oracle 5,500 56,121 142,271
Synopsis, Inc. 5,600 115,460 126,896
--------- ---------
323,207 458,484
Medical Products and Supplies - 9.40%
Johnson & Johnson 2,400 136,714 154,320
Medtronic Inc. 3,000 147,940 131,070
Stryker Corporation 2,600 125,743 149,344
--------- ---------
410,397 434,734
Electrical Equipment - 7.38%
Corning Inc. 9,700 108,148 186,725
General Electric Co. 8,200 196,783 154,652
--------- ---------
304,931 341,377
Semiconductors - 6.73%
Intel Corp. 8,000 143,610 182,720
National Semiconductor 8,700 143,165 128,586
--------- ---------
286,775 311,306
Pharmaceuticals - 6.27%
Mylan Inc. 6,300 87,179 138,663
Pharmaceutical Product 5,500 129,615 151,305
--------- ---------
216,794 289,968
Retail - Specialty - 5.44%
Fastenal Co. 4,600 160,395 251,574
Retail - General - 4.51%
Fred's Inc. Class A 15,000 152,560 208,350
Electronics Components - 3.82%
Tyco Electronics 5,500 149,751 176,660
Beverages - 3.72%
Hansen Natural Corp. 3,900 125,589 172,185
Information Services - 3.55%
Interactive Data Corp. 4,900 127,966 164,003
Machinery - 3.42%
Idex Corporation 4,700 151,555 157,920
Historical
Shares Cost Value
Insurance - 3.24%
Gallagher Arthur J&Co. 5,700 138,298 149,739
Commercial Services - 3.04%
Paychex, Inc. 4,600 148,135 140,622
Building & Related - 3.00%
Ameron International 2,000 127,814 138,780
Banking & Finance - 2.99%
FIserv, Inc. 2,700 112,511 138,051
Biotech - 2.94%
Meridian Bioscience 6,800 118,878 135,932
Food Processing - 2.73%
Sensient Technologies 4,000 80,550 126,120
Oil & Related - 2.37%
Frontier Oil Corp 7,200 86,163 109,440
Aerospace - 2.32%
AAR Corporation 4,400 83,191 107,272
Computers - Networking - 2.21%
Cisco Systems, Inc. 3,800 55,372 102,334
Utilities - Natural Resources - 2.02%
Chesapeake Utilities 3,100 57,194 93,372
Industrial Services - 1.67%
Expeditors Int'l
Washington 1,900 61,567 77,349
Computers - Hardware - 1.52%
Dell Corporation 4,350 90,055 70,470
Schwab Money Market - 5.80% 268,074
Total Investments in Securities $ 3,569,648 $ 4,624,116
========= =========
(A SERIES WITHIN BULLFINCH FUND, INC.)
SCHEDULE OF INVESTMENTS IN SECURITIES APRIL 30, 2010
(UNAUDITED)
Table of Industries
Industry Market Value Pct.
- ------------------------------ -------------- -----
Aerospace $ 107,272 2.32%
Banking & Finance $ 138,051 2.99%
Beverages $ 172,185 3.72%
Biotech $ 135,932 2.94%
Building & Related $ 138,780 3.00%
Commercial Services $ 140,622 3.04%
Computers - Hardware $ 70,470 1.52%
Computers - Networking $ 102,334 2.21%
Computers - Software $ 458,484 9.91%
Electrical Equipment $ 341,377 7.38%
Electronics Components $ 176,660 3.82%
Food Processing $ 126,120 2.73%
Industrial Services $ 77,349 1.67%
Information Services $ 164,003 3.55%
Insurance $ 149,739 3.24%
Machinery $ 157,920 3.42%
Medical Products & Supplies $ 434,734 9.40%
Oil & Related $ 109,440 2.37%
Pharmaceuticals $ 289,968 6.27%
Retail - General $ 208,350 4.51%
Retail - Specialty $ 251,574 5.44%
Semiconductors $ 311,306 6.73%
Utilities - Natural Resources $ 93,372 2.02%
----------- -------
Total Equities $ 4,356,042 94.20%
Cash & Equivalents $ 268,074 5.80%
----------- -------
Total Invested Assets $ 4,624,116 100.00%
=========== =======
The accompanying notes are an integral part of these statements.
UNRESTRICTED SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)
STATEMENTS OF OPERATIONS FOR THE PERIOD FROM NOVEMBER 1, 2009
TO APRIL 30, 2010, FOR THE YEAR ENDED OCTOBER 31, 2009
AND FOR THE FOUR MONTHS ENDED OCTOBER 31, 2008
AND FOR THE YEAR ENDED JUNE 30, 2008 (UNAUDITED)
4/2010 4/2009 10/2008 6/2008
INVESTMENT INCOME:
Dividends $ 37,090 $ 71,612 $ 28,411 $ 121,723
EXPENSES:
Management Fees 22,479 42,876 17,005 53,669
Legal and Professional 6,140 12,521 6,164 12,020
Director's Fees 0 1,200 650 1,200
D&O/E&O 4,459 8,684 2,873 7,685
Fidelity Bond 0 919 919 1,058
Taxes 300 585 300 309
Telephone 134 95 0 137
Registration Fees 775 2,751 118 1,275
Custodian Fees 7,783 2,677 2,737 2,865
Dues and Subscriptions 1,737 2,034 216 2,484
-------- -------- -------- ---------
Total expense 43,807 74,342 30,982 82,702
-------- -------- -------- ---------
Net investment income (loss) (6,717) (2,730) (2,571) 39,021
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Realized gain (loss) from
securities transactions 70,233 (281,373) 0 2,740
Unrealized appreciation
(depreciation) during
the period 713,461 517,501 (859,412) (598,228)
-------- -------- -------- --------
Net gain (loss) on
investments 783,694 236,128 (859,412) (595,488)
-------- -------- -------- --------
INCREASE (DECREASE) IN
NET ASSETS RESULTING
FROM OPERATIONS $ 776,977 $ 233,398 $(861,983) $(556,467)
UNRESTRICTED SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)
STATEMENTS OF CHANGES IN NET ASSETS FOR THE PERIOD FROM NOVEMBER 1, 2009
TO APRIL 30, 2010, FOR THE YEAR ENDED OCTOBER 31, 2009
AND FOR THE FOUR MONTHS ENDED OCTOBER 31, 2008
AND THE YEAR ENDED JUNE 30, 2008 (UNAUDITED)
4/2010 4/2009 10/2008 6/2008
INCREASE IN NET ASSETS FROM OPERATIONS:
Net investment income (loss)$(6,717) $ (2,730) $ (2,571) $ 39,021
Net realized gain (loss) from
security transactions 70,233 (281,373) 0 2,740
Net change in unrealized
Appreciation (depreciation)
of investments 713,461 517,501 (859,412) (598,228)
-------- -------- -------- --------
Increase (decrease) in
net assets resulting
from operations 776,977 233,398 (861,983) (556,467)
CAPITAL SHARE TRANSACTION:
Sales 92,419 139,406 325,468 368,454
Redemptions (246,466) (650,802) (92,678) (71,018)
Total capital share
transactions (154,047) (511,396) 232,790 297,436
-------- -------- -------- --------
Increase in net assets 622,930 (277,998) (629,193) (259,031)
NET ASSETS:
Beginning of period $ 3,996,997 4,274,995 4,904,188 5,163,219
End of period $ 4,619,927 3,996,997 4,274,995 4,904,188
The accompanying notes are an integral part of these statements.
UNRESTRICTED SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)
NOTES TO FINANCIAL STATEMENTS APRIL 30, 2010 (UNAUDITED)
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.
As of October 31, 2009 the Series has capital loss carryforwards of $281,373
which expire in eight years.
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 $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. The Series made a distribution of its
long term capital gains of $86,821 and ordinary income of $22,790 to its
shareholders on December 26, 2007 in the form of stock dividends equal to
7,735.411 shares of stock. The Series made a distribution of its ordinary
income of $14,355 to its shareholders on June 27, 2008 in the form of stock
dividends equal to 1,104.207 shares of stock. The Series made a distribution
of its ordinary income of $7,748 to its shareholders on December 30, 2008,
in the form of stock dividends equal to 779.456 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.
Subsequent events were evaluated through December 23, 2009.
NOTE C - INVESTMENTS
For the period November 1, 2009 to April 30, 2010, the Series purchased
$531,238 of common stock. During the same period, the Series sold
$126,779 of common stock.
For the year ended October 31, 2009, the Series purchased $656,031 of
common stock. During the same period, the Series sold $950,748 of common
stock
For the four months ended October 31, 2008, the Series purchased $509,741
of common stock. During the same period, the Series sold $0 of common
stock.
For the year ended June 30, 2008, the Series purchased $1,509,753 of common
stock. During the same period, the Series sold $1,275,745 of common stock.
At April 30, 2010, the gross unrealized appreciation for all securities
totaled $887,072 and the gross unrealized depreciation for all
securities totaled $100,678, or a net unrealized appreciation of
$786,394. The aggregate cost of securities for federal income tax
purposes at April 30, 2010 was $3,569,648.
At October 31, 2009, the gross unrealized appreciation for all securities
totaled $337,999 and the gross unrealized depreciation for all
securities totaled $265,066, or a net unrealized appreciation of
$72,933. The aggregate cost of securities for federal income
tax purposes at October 31, 2009 was $3,098,089.
At October 31, 2008, the gross unrealized appreciation for all securities
totaled $308,970 and the gross unrealized depreciation for all securities
totaled $753,538, or a net unrealized depreciation of $444,568. The
aggregate cost of securities for federal income tax purposes at October
31, 2008 was $3,674,180.
At June 30, 2008, the gross unrealized appreciation for all securities totaled
$647,125 and the gross unrealized depreciation for all securities totaled
$232,280, or a net unrealized appreciation of $414,845. The aggregate cost of
securities for federal income tax purposes at June 30, 2008 was $3,164,439.
NOTE D - INVESTMENT ADVISORY AGREEMENT
Carosa Stanton 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 Asset Management, LLC
is a Registered Investment Adviser under the Investment Advisers Act of 1940.
The Investment advisory agreement provides that Carosa Stanton 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 & Mulhern 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 period from November 1, 2009 to April 30, 2010, the fiscal year
ended October 31, 2009, the four months ended October 31, 2008, and the year
ended June 30, 2008, the fund paid investment advisory fees of $$22,479,
$42,876, $17,005, and $53,669 respectively.
On April 30, 2010, the fund had $3,951 included in accrued expenses, as
owed to Carosa Stanton 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, 2007 348,746.944 $ 4,387,887
Shares sold during 2008 26,404.727 368,454
Shares Redeemed during 2008 (5,134.964) (71,018)
Reinvestment of Distributions,
December 26, 2007 7,735.411 109,611
Reinvestment of Distributions,
June 27, 2008 1,104.207 14,355
Balance at June 30, 2008 378,856.325 $ 4,809,289
Shares sold during short period 2008 28,641.407 325,468
Shares Redeemed during short period 2008 (7,089.452) (92,678)
Balance at October 31, 2008 400,408.280 $ 5,042,079
Shares sold during 2009 13,278.412 139,406
Shares redeemed during 2009 (59,858.012) (650,802)
Reinvestment of Distributions,
December 30, 2008 779.456 7,748
Balance at October 31, 2009 354,608.136 $ 4,538,431
Shares sold during period 7,408.713 92,419
Shares redeemed during period (20,024.586) (246,466)
Balance at April 30, 2010 341,992.263 $ 4,384,384
UNRESTRICTED SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)
FINANCIAL HIGHLIGHTS (SUPPLEMENTAL DATA FOR A SHARE OUTSTANDING)
FOR THE PERIOD FROM NOVEMBER 1, 2009 TO APRIL 30, 2010,
FOR THE YEAR ENDED OCTOBER 31, 2009
AND FOR THE FOUR MONTHS ENDED OCTOBER 31, 2008, AND
THE YEAR ENDED JUNE 30, 2008 (UNAUDITED)
4/2010 10/2009 10/2008 6/2008
NET ASSET VALUE,
beginning of period $ 11.27 $10.68 $12.94 $14.81
INCOME FROM INVESTMENT
OPERATIONS
Net investment
income (loss) (0.02) (0.01) (0.01) 0.10
Net gain (loss) on
securities both
realized and
unrealized 2.26 0.58 (2.25) (2.31)
Total from investment
Operations 2.24 0.57 (2.26) (2.21)
DISTRIBUTIONS
Dividends 0.00 0.02 0.00 0.34
NET ASSET VALUE,
end of period $ 13.51 $11.27 $10.68 $12.94
NET ASSETS,
end of period $4,619,927 $3,996,997 $4,274,995 $4,904,188
Actual** Actual Actual Actual
RATIO OF EXPENSES
TO AVERAGE NET ASSETS* 1.02%** 1.84 % 0.64 % 1.62 %
RATIO OF NET INVESTMENT INCOME
TO AVERAGE NET ASSETS* (0.16)%** (0.07)% (0.05)% 0.77%
PORTFOLIO TURNOVER RATE* 2.95%** 16.23% 0.00% 25.03%
TOTAL RETURN 16.17% 5.73% (28.44)% (10.76)%
* Per share amounts calculated using the average shares method
** The ratios presented were calculated using operating data for the six-month
period from November 1, 2009 to April 30, 2010
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 APRIL 30, 2010
(UNAUDITED)
GREATER WESTERN NEW YORK SERIES
(A SERIES WITHIN BULLFINCH FUND, INC.)
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 2010 (UNAUDITED)
ASSETS
Investments in securities, at fair value,
identified cost of $631,886 $ 792,838
Cash 12,690
Accrued Interest and Dividends 644
Prepaid Expenses 361
----------
Total assets $ 806,533
==========
LIABILITIES AND NET ASSETS
LIABILITIES
Accrued Expenses $ 1,447
----------
NET ASSETS
Net assets (equivalent to $13.43 per share
based on 59,957.481 shares of stock outstanding) 805,086
----------
Total Liabilities and Net Assets $ 806,533
==========
COMPOSITION OF NET ASSETS
Shares of common Stock - Par Value $.01;
10,000,000 Shares Authorized,
59,957.481 Shares Outstanding $ 689,703
Accumulated net investment loss (45,569)
Net unrealized appreciation on investments 160,952
----------
Net assets at April 30, 2010 $ 805,086
==========
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 April 30, 2010 (UNAUDITED)
Historical
Common Stocks - 100% Shares Cost Value
Electronics Components - 10.09%
Astronics Corp. 1,750 $ 15,396 $ 25,305
IEC Electronics Corp. 4,518 6,984 23,855
Tyco Electronics 1,000 27,259 32,120
-------- --------
49,639 81,280
Electrical Equipment - 10.02%
Corning, Inc. 1,900 21,673 36,575
General Electric Co. 1,450 35,248 27,347
Ultralife Corporation. 4,000 25,175 16,760
-------- --------
82,096 80,682
Medical Products & Supplies - 8.69%
Bristol-Myers Squibb Co. 1,000 21,938 25,310
Greatbatch Technologies 850 18,984 18,989
Johnson & Johnson 400 22,617 25,720
-------- --------
63,539 70,019
Aerospace - 7.82%
Harris Corporation 500 24,989 25,740
Moog, Inc. Class A 637 15,976 23,677
Northrop Grumman 200 2,536 13,566
-------- --------
43,501 62,983
Banking & Finance - 6.93%
Community Bank System 1,200 23,452 29,604
M &T Bank Corp. 300 29,839 26,205
-------- --------
53,291 55,809
Real Estate & Related - 5.22%
Home Properties Inc. 400 16,297 19,876
Sovran Self Storage 600 23,459 22,134
-------- --------
39,756 42,010
Railroads - 4.37%
Genesee & Wyoming Class A 900 2,522 35,190
Computers - Services - 4.08%
Computer Task Group Inc. 3,500 11,872 32,865
Machinery - 3.98%
Columbus McKinnon Corp. 100 2,344 1,803
Idex Corporation 900 29,029 30,240
-------- --------
31,373 32,043
Commercial Services - 3.78%
Harris Interactive, Inc. 2,200 6,273 2,970
Paychex, Inc. 900 24,805 27,513
-------- --------
31,078 30,483
Retail - Specialty - 3.73%
Fastenal Co. 550 19,186 30,080
Steel - 3.73%
Gibraltar Industries Inc. 2,000 25,111 30,040
Foods & Beverages - 3.40%
Constellation Brands Inc. 1,500 15,118 27,405
Historical
Shares Cost Value
Utilities - Natural Resources - 3.23%
National Fuel Gas Co. 500 11,250 26,010
Automotive - 3.12%
Monro Muffler Brake Inc. 700 12,443 25,158
Metal Fabrication & Hardware - 3.10%
Graham Corp. 1,400 15,140 24,990
Computers - Software - 2.89%
Oracle 900 12,070 23,281
Computers - Hardware - 2.82%
Dell Corporation 1,400 23,781 22,680
Office Equipment - 1.89%
Xerox Corp. 1,400 17,817 15,260
Telecommunications - 1.78%
Frontier Communications 1,800 20,663 14,328
Photographic Equipment and Suppliers - 1.22%
Eastman Kodak Co. 1,600 34,170 9,808
Computers - Distributors - 0.90%
Ingram Micro 400 4,230 7,264
Packaging & Containers - 0.80%
Mod Pac Corporation 1,130 4,875 6,475
Airlines - 0.41%
Southwest Airlines Co. 250 3,447 3,295
Health Care Service Provider - 0.32%
VirtualScopics, Inc. 2,000 2,981 2,560
Industrial Materials - 0.10%
Servotronics, Inc. 100 937 840
Schwab Money Market - 1.58% 12,690
Total Investments in Securities $ 631,886 $ 805,528
GREATER WESTERN NEW YORK SERIES
(A SERIES WITHIN BULLFINCH FUND, INC.)
SCHEDULE OF INVESTMENTS IN SECURITIES APRIL 30, 2010 (UNAUDITED)
Table of Industries
Industry Market Value Pct.
- ------------------------------ -------------- -----
Aerospace $ 62,983 7.82%
Airlines $ 3,295 0.41%
Automotive $ 25,158 3.12%
Banking & Finance $ 55,809 6.93%
Commercial Services $ 30,483 3.78%
Computers - Distributors $ 7,264 0.90%
Computers - Hardware $ 22,680 2.82%
Computers - Services $ 32,865 4.08%
Computers - Software $ 23,281 2.89%
Electrical Equipment $ 80,682 10.02%
Electronics Components $ 81,280 10.09%
Foods & Beverages $ 27,405 3.40%
Health Care Service Provider $ 2,560 0.32%
Industrial Materials $ 840 0.10%
Machinery $ 32,043 3.98%
Medical Products & Supplies $ 70,019 8.69%
Metal Fabrication & Hardware $ 24,990 3.10%
Office Equipment $ 15,260 1.89%
Packaging & Containers $ 6,475 0.80%
Photographic Equipment & Suppliers $ 9,808 1.22%
Railroads $ 35,190 4.37%
Real Estate & Related $ 42,010 5.22%
Retail - Specialty $ 30,080 3.73%
Steel $ 30,040 3.73%
Telecommunications $ 14,328 1.78%
Utilities - Natural Resources $ 26,010 3.23%
-------------- --------
Total Equities $ 547,416 82.53%
Cash & Equivalents $ 12,690 1.58%
-------------- --------
Total Invested Assets $ 805,528 100.00%
============== ========
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 PERIOD FROM NOVEMBER 1, 2009 TO
APRIL 30, 2010, FOR THE YEAR ENDED OCTOBER 31, 2009
AND FOR THE FOUR MONTHS ENDED OCTOBER 31, 2008
AND THE YEAR ENDED JUNE 30, 2008 (UNAUDITED)
4/2010 10/2009 10/2008 6/2008
INVESTMENT INCOME:
Dividends $ 6,991 $ 14,568 $ 4,826 $ 15,049
EXPENSES:
Management fees 4,657 8,557 3,422 9,448
Reimbursement of
Management Fees 0 (1,909) 0 (156)
Legal and Professional 682 1,647 707 1,380
Director's Fees 0 1,200 650 1,200
D&O/E&O 495 965 319 902
Fidelity Bond 0 102 102 117
Taxes 416 665 300 150
Telephone 134 95 0 137
Registration Fees 1,935 651 107 300
Custodian Fees 1,137 587 702 394
Dues and Subscriptions 937 1,234 216 1,284
-------- -------- -------- ---------
Total expense 10,393 13,794 6,525 15,156
-------- -------- -------- ---------
Net investment income (loss) (3,402) 774 (1,699) (107)
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Realized gain (loss) from securities
Transactions 5,130 (15,528) (446) 21,036
Unrealized appreciation (depreciation)
during the period 172,007 (13,899) (134,961) (100,995)
-------- -------- -------- ---------
Net gain (loss)
on investments 177,137 (29,427) (135,407) (79,959)
INCREASE (DECREASE) IN
NET ASSETS RESULTING
FROM OPERATIONS $ 173,735 $(28,653) $(137,106) $ (80,066)
GREATER WESTERN NEW YORK SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)
STATEMENTS OF CHANGES IN NET ASSETS FOR THE PERIOD FROM NOVEMBER 1, 2008
TO APRIL 30, 2009, FOR THE YEAR ENDED OCTOBER 31, 2009
AND FOR THE FOUR MONTHS ENDED OCTOBER 31, 2008
AND THE YEAR ENDED JUNE 30, 2008 (UNAUDITED)
4/2010 10/2009 10/2008 6/2008
DECREASE IN NET ASSETS FROM OPERATIONS:
Net investment income (loss)$(3,402) $ 774 $ (1,699) $ (107)
Net realized gain (loss) from
security transactions 5,130 (15,528) (446) 21,036
Net change in unrealized
appreciation (depreciation)
of investments 172,007 (13,899) (134,961) (100,995)
-------- -------- -------- ---------
Increase (decrease) in
net assets resulting
from operations 173,735 (28,653) (137,106) (80,066)
CAPITAL SHARE TRANSACTIONS:
Sales 25,519 12,297 151,830 122,449
Redemptions (88,653) (60,725) (7,102) (6,000)
-------- -------- -------- ---------
Total capital
share transactions (63,134) (48,428) 144,728 116,449
-------- -------- -------- ---------
Increase in net assets 110,601 (77,081) 7,622 36,383
NET ASSETS:
Beginning of period 694,485 771,566 763,944 727,561
End of period $805,086 694,485 771,566 763,944
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 APRIL 30, 2010 (UNAUDITED)
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.
As of October 31, 2009 the Series has capital loss carryforwards of $15,974
which expire in eight years.
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 $3,850 to its shareholders on December 27,
2006, in the form of stock dividends equal to 286.269 shares of stock. The
Series made a distribution of its long-term capital gains of $24,796 to its
shareholders on December 26, 2007, in the form of stock dividends equal to
1,711.274 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.
Subsequent events were evaluated through December 23, 2009.
NOTE C - INVESTMENTS
For the period from November 1, 2009 to April 30, 2010, the Series
purchased $0 of common stock. During the same period, the Series sold
$17,783 of common stock.
For the year ended October 31, 2009, the Series purchased $46,398
of common stock. During the same period, the Series sold $27,690 of
common stock.
For the year ended June 30, 2008, the Series purchased $216,441 of common
stock. During the same period, the Series sold $122,654 of common stock.
At April 30, 2010, the gross unrealized appreciation for all
securities totaled $ 221,095 and the gross unrealized depreciation for
all securities totaled $60,143, or a net unrealized appreciation of
$160,952. The aggregate cost of securities for federal income tax
purposes at April 30, 2010 was $631,886.
At October 31, 2009, the gross unrealized appreciation for all securities
totaled $110,953 and the gross unrealized depreciation for all securities
totaled $122,008 or a net unrealized depreciation of $11,055. The
aggregate cost of securities for federal income tax purposes at
October 31, 2009 was $645,514.
At October 31, 2008, the gross unrealized appreciation for all securities
totaled $119,091 and the gross unrealized depreciation for all securities
totaled $116,247, or a net unrealized appreciation of $2,844. The aggregate
cost of securities for federal income tax purposes at October 31, 2008 was
$642,996.
At June 30, 2008, the gross unrealized appreciation for all securities totaled
$205,277 and the gross unrealized depreciation for all securities totaled
$67,473, or a net unrealized appreciation of $137,804. The aggregate cost of
securities for federal income tax purposes at June 30, 2008 was $513,973.
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.
NOTE D - INVESTMENT ADVISORY AGREEMENT
Carosa Stanton 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 Asset Management, LLC is a
Registered Investment Adviser under the Investment Advisers Act of 1940. The
Investment advisory agreement provides that Carosa Stanton 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 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 period from November 1, 2009 to April 30, 2010, the fiscal
year ended October 31, 2009, the four months ended October 31, 2008,
and the year ended June 2008, the fund paid investment advisory fees of
$4,657, $6,648, $3,422 and $9,292 respectively.
On April 30, 2010 the fund had $815 included in accrued expenses, as
owed to Carosa Stanton 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, 2007 48,994.697 $ 515,292
Shares sold during 2008 8,926.488 122,449
Shares redeemed during 2008 (418.003) (6,000)
Reinvestment of Distributions, December 26, 2007 1,711.274 24,796
Balance at June 30, 2008 59,214.456 $ 656,537
Shares sold during short period 2008 11,499.549 151,830
Shares redeemed during short period 2008 (701.804) (7,102)
Balance at October 31, 2008 70,012.201 $ 801,265
Shares sold during 2009 1,278.357 12,297
Shares redeemed during 2009 (6,022.385) (60,725)
Balance at October 31, 2009 65,268.173 $752,837
Shares sold during period 2,061.508 25,519
Shares redeemed during period (7,372.200) (88,653)
Balance at April 30, 2010 59,957.481 $ 689,703
GREATER WESTERN NEW YORK SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)
FINANCIAL HIGHLIGHTS (SUPPLEMENTAL DATA FOR A SHARE OUTSTANDING)
FOR THE PERIOD FROM NOVEMBER 1, 2008 TO APRIL 30, 2009,
FOR THE YEAR ENDED OCTOBER 31, 2009 AND
FOR THE FOUR MONTHS ENDED OCTOBER 31, 2008 AND
THE YEAR ENDED JUNE 30, 2008 (UNAUDITED)
1 2 3 4 5 6 7 8
12345678901234567890123456789012345678901234567890123456789012345678901234567890
4/2010 10/2009 10/2008 6/2008
NET ASSET VALUE,
beginning of period $ 10.64 $ 11.02 $ 12.90 $ 14.85
INCOME FROM INVESTMENT OPERATIONS
Net investment income
(loss) (0.06) 0.01 (0.02) 0.00
Net gain (loss) on
securities both
realized and
unrealized 2.85 (0.39) (1.86) (2.43)
Total from investment
Operations 2.79 (0.38) (1.88) (2.43)
DISTRIBUTIONS
Dividends 0.00 0.00 0.00 0.48
NET ASSET VALUE,
end of period $ 13.43 $10.64 $11.02 $ 12.90
NET ASSETS, end of period $805,086 $694,485 $771,566 $763,944
Actual** Actual Actual Actual
RATIO OF EXPENSES TO
AVERAGE NET ASSETS* 1.39%** 2.00% 0.79% 2.00%
RATIO OF EXPENSES TO AVERAGE NET ASSETS
BEFORE REIMBURSEMENT* 1.39%** 2.28% 0.79% 2.03%
RATIO OF NET INVESTMENT INCOME
TO AVERAGE NET ASSETS* (0.46)%** 0.11% (0.21)% (0.01)%
PORTFOLIO TURNOVER RATE* 0.00%** 4.02% 6.07% 16.22%
TOTAL RETURN 18.74% (3.45)% (26.93)% (10.18)%
* Per share amounts calculated using the average shares method
** The ratios presented were calculated using operating data for the
six-month period from November 1, 2009 to April 30, 2010.
The accompanying notes are an integral part of these statements.
ADDITIONAL INFORMATION
EXPENSE TABLE Beginning Ending
Account Value Account Value Annualized Expenses Paid
ACTUAL 11/1/09 4/30/10 Expense Ratio During Period+
Unrestricted Series $ 1,000.00 $ 1,161.70 1.02% $ 5.47
Greater Western
New York Series 1,000.00 1,187.40 1.39% $ 7.54
HYPOTHETICAL+
Unrestricted Series 1,000.00 1,025.00 0.93% $ 4.67
Greater Western
New York Series 1,000.00 1,025.00 1.15% $ 5.77
+ 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 (November 1, 2009 to April 30, 2010).
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. 3909 Rush Mendon Road, Mendon,
New York 14506
The directors and officers of the Fund are:
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, 49 President; Term of Office: President, Founder 2 N/A
2 Lantern Lane Director; N/A Carosa Stanton
Honeoye Falls, Chairman of Length of Time Asset Management, LLC;
New York 14472 Board; Chief Served: President, Director
Compliance Since 1997 and Chairman of the
Officer Board, Bullfinch Fund, Inc.
Gordon Stanton, 51 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 Asset Management, LLC;
New York, Served: Vice-President,
NY 10128 Since 1997 and Director,
Bullfinch Fund, Inc.;
Associate, Brown Harris
Stevens Residential
Betsy Kay Carosa, 50 Corporate Term of Office: Office Manager 2 N/A
2 Lantern Lane Secretary N/A Carosa Stanton
Honeoye Falls, Length of Time Asset Management, LLC;
NY 14472 Served: Corporate Secretary,
Since 1997 Bullfinch Fund, Inc.
</Table>
INDEPENDENT DIRECTORS
<Table>
Thomas M. Doeblin, 50 Director; Term of Office: Teacher 2 N/A
73 San Gabriel Drive Audit N/A Pittsford-Mendon High
Rochester, Committee Length of Time School
NY 14610 Served:
Since 2006
John P. Lamberton, 50 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, 50 Director Term of Office: Managing Member, 2 N/A
4410 Woodlawn Ave. N N/A Chipman and Martin, LLC;
Seattle, Length of Time Consultant, Robson Forensic;
WA 98103 Served: Aecon Buildings, Inc.;
Since 1997 Project Manager,
American Home Builders
Bryan D. Hickman, 65 Director Term of Office: President 2 N/A
6288 Bobble Hill Road Audit N/A Coach & Equipment
Naples, Committee Length of Time Manufacturing Co.
NY 14512-9700 Served:
Since 2008
Michael J. Morris, 49 Director; Audit Term of Office: N/A Actuary 2 N/A
72 Lovely Street Committee Length of Time United Healthcare
Unionville, CT 06085 Served: Since 1997
Lois Niland, 58 Director Term of Office: Marketing Consultant 2 N/A
33 Oak Meadow Trail N/A Complemar Partners;
Pittsford, Length of Time President, Icon Design;
NY 14534 Served: General Manager, Xerox
Since 2006
Michael W. Reynolds, 49 Director Term of Office: President 2 N/A
105 Dorchester Road Audit N/A Reynolds & Company
Buffalo, Committee Length of Time
NY 14213 Served:
Since 2000
</Table>
PROXY VOTING GUIDELINES
Carosa Stanton 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 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 noted the unprecedented access they have to the Adviser,
the quick responsiveness to requests and the positive review following Mr.
Lamberton's multi-day visits all show the high quality of service provided by
the Adviser.
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 the Series' long-term performance exceeded the benchmarks and were
in-line with or better than its peers (as reported by Lipper).
3. The cost of adviser services and the profits realized by the Adviser - the
Independent Directors noted the Adviser is not charging and is not receiving
an excessive amount of profit for, among other reasons, its continued
subsidization of the Greater Western New York Series.
4. Extent to which economies of scale would be realized as a fund group - the
Independent Directors noted the advisery fee schedule includes breakpoints
and that the Fund is not subject to sales charges or Rule 12b-1 fees.
5. Do fee levels reflect economies of scale for the benefit of fund investors?
- - the Independent Directors noted the Adviser has already agreed to cap the
fees at 2% and reduce that cap to 1.5% when a Series' assets exceed $10
million. The Independent Directors noted there was an increase in expenses
primarily due to the D&O/E&O costs and expressed a desire for increased
direct marketing in order to further take advantage of economies of scale.
6. 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.
10/31/2009 10/31/2008
Audit Fees $11,500 $ 6,200
Audit-Related Fees $ 0 $ 0
Tax Fees $ 2,000 $ 0
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: June 28, 2010
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/ Christopher Carosa
----------------------------------------
Christopher Carosa,
President of Bullfinch Fund, Inc.
Date: June 28, 2010