As filed with the Securities and Exchange Commission on November 7, 2003
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
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CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number: 811-07737
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The Purisima Funds
(Exact name of registrant as specified in charter)
13100 Skyline Blvd.
Woodside, California 94062
(Address of principal executive offices)
(Name and address of agent for service)
1-800-851-8845
Registrant's telephone number, including area code
Date of fiscal year end: August 31, 2003
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Date of reporting period: August 31, 2003
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Item 1. Reports to Stockholders.
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Annual Report August 31, 2003.
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PURISIMA FUNDS
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ANNUAL REPORT
AUGUST 31, 2003
The Purisima Total Return Fund
The Purisima Pure American Fund
The Purisima Pure Foreign Fund
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TABLE OF CONTENTS
Shareholder Letter 1-4
Performance Summaries 5-6
Financial Information 7-23
Notes to Financial Statements 24-25
Other Information 29-31
Report of Independent Accountants 32
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INVESTMENT OBJECTIVES
PURISIMA TOTAL RETURN FUND
Seeks to provide investors with a high level of total return by considering both
domestic and foreign securities.
PURISIMA PURE AMERICAN FUND
Seeks to provide investors with a high level of total return, while
concentrating its holdings in U.S. securities.
PURISIMA PURE FOREIGN FUND
Seeks to provide investors with a high level of total return, while
concentrating its holdings in securities outside the U.S.
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EACH FUND RESERVES THE RIGHT TO REJECT ANY ORDER FOR THE PURCHASE OF ITS SHARES
OR TO LIMIT OR SUSPEND, WITHOUT PRIOR NOTICE, THE OFFERING OF ITS SHARES. THE
REQUIRED MINIMUM INVESTMENTS MAY BE WAIVED IN THE CASE OF CERTAIN QUALIFIED
RETIREMENT PLANS. THE FUNDS WILL NOT ACCEPT YOUR ACCOUNT IF YOU ARE INVESTING
FOR ANOTHER PERSON AS ATTORNEY-IN-FACT. THE FUNDS ALSO WILL NOT ACCEPT ACCOUNTS
WITH A "POWER OF ATTORNEY" IN THE REGISTRATION SECTION OF THE PURCHASE
APPLICATION.
A LETTER TO OUR SHAREHOLDERS
Welcome to the annual report for the Purisima Funds for the year ended
August 31, 2003. After moving from a defensive posture in mid-2002, the Funds
remained fully invested in equities throughout the period. Following an up and
down first half to the period, global equities staged a sharp rally almost
immediately following the commencement of Operation Iraqi Freedom. The core
drivers that we think are underpinning the rebound continue to play out largely
in line with our expectations, leading us to remain optimistic about further
upside in the medium term.
For the period covered by the report, the Funds performed generally in-line
with their respective benchmarks. The Foreign and Total Return Funds posted an
absolute gain of over 10%, while the Domestic Fund yielded a high single-digit
total return.
The sharp sell-offs in July and September 2002 seemingly created a double
bottom in the already lengthy bear market. Although economic recovery began in
the first half of 2002, expectations of a double-dip recession permeated
financial media and investor sentiment throughout the end of 2002 and the start
of 2003. Stocks mounted a sharp rally beginning in early October that reflected
renewed optimism and saw the most battered groups of the bear market perform the
best. The rally culminated in December 2002 as the solidarity of the UN Security
Council came into question regarding a military solution to Saddam Hussein's
Iraqi regime.
The economy showed marked signs of improvement in the fourth quarter of
2002, countering the dour views of pundits and economists alike. However, the
degree to which world opinion soured leading up to the war was unexpected. In
concert with the threat of war, investors were barraged by financial media
claims that the bear market remained intact and any rally should be treated as a
selling opportunity. We strongly disagreed then and maintain our positive
outlook today.
After a negative first quarter of 2003, global stock market indexes began
moving higher in the spring and had reached 52-week highs by the summer months,
climbing a proverbial "wall of worry." Although economic recovery began in the
first half of 2002, fears of continued joblessness, SARS, deflation, a weakened
dollar, and a quagmire in Iraq permeated financial media and investor sentiment.
Major world equity indexes saw past these tribulations and rallied through the
second half of the period. Stocks even advanced through the summer months, which
are traditionally perceived to be negative for stocks.
The most significant surprise to investors in our view has been the
dramatic fiscal policy package initiated by President Bush--both in timing and
scope. The capital gains tax reduction was a particularly pleasant surprise and
should prove to have meaningful positive long-term effects. The acceleration of
marginal income tax rate cuts and the slashing of dividend tax rates are
beneficial additions to the capital gains measure and should provide substantial
supply side stimulus in coming years. Various European
countries including Germany, France, and Italy are seemingly following suit with
significant structural reforms of their own.
The asset and sub-asset allocation decisions within the Funds remained
consistent throughout the period. Consumer Discretionary and Materials sectors
remain significantly overweight in the Funds relative to their benchmarks as
early cycle stocks historically enjoy leadership first. We've also overweighted
the portfolios to technology stocks, which were among the best performers during
the period. We've chosen what we regard as higher quality technology businesses
featuring healthy financials and dominant market positions. These companies
should best capitalize on emerging opportunities and leverage market share
growth to improve margins as the technology economy rebounds from depressed
levels.
In each of the Funds, the weighted average market capitalization of the
holdings is slightly smaller than that of the respective benchmarks, consistent
with our belief that small caps tend to lead in new bull markets as a liquidity
surge provides disproportional benefits across the size spectrum. However,
smaller cap stocks' dramatic outperformance over the course of the bear market
leads us to place only a modest style bet there. Outside of the technology
overweight, we maintain a modest value slant in the portfolios, hoping to
capitalize on steep global yield curves that beget favorable lending conditions
across the globe. Growth stocks outperformed stocks believed to be
representative of a value strategy in the latter half of the period, mainly as a
result of technology's performance, but we expect this trend to be short-lived.
In an effort to control risk relative to benchmark, all three of the Funds
maintain active counter-strategies in case we are wrong on our core economic and
market assumptions. The Funds hold underweight positions in large cap and
growth-oriented companies as well as positions in more defensive sectors like
Health Care, Consumer Staples, and Utilities.
The Total Return Fund is modestly overweight US stocks, consistent with our
belief that the US economy has the most favorable prospects to lead the global
recovery. With promising fundamentals, we expect that foreign indexes are also
likely to rise materially on an absolute basis, and we've positioned the
portfolio to capture relative strength in continental Europe. We've taken an
underweight position to the United Kingdom, whose comparatively less
accommodative monetary policy and tighter fiscal policy pose additional risk.
Our holdings in Japan are focused on large, financially stable global exporters.
In the late months of summer, our Japanese equities posted significant relative
gains compared to other countries. We're cautiously optimistic about Japan, but
are more enthusiastic on the potential of other regions and, therefore, have
taken a slight underweight position. Pure American's long equity positions are
limited to US companies. Likewise, Pure Foreign's are limited to foreign
companies only, and bear similar regional weightings to the Total Return Fund
described above.
OUTLOOK
Our bullish forecast made over a year ago calling for outsized returns
following a long bear market has not changed. We maintain that significant gains
could be ahead, and we see nothing on the horizon that causes us to retract this
view. The basic reasoning behind our bullish outlook remains intact. The US is
in the 2nd half of the Presidential Cycle, historically the strongest for US
stocks. Monetary conditions are accommodative, interest rates remain low, and
fiscal policy in the US and European nations offers additional stimulus.
Geopolitical risks have significantly abated since the end of major combat in
Iraq, and the fervor for increased regulatory intervention in corporate affairs
that followed the WorldCom and Enron incidents is diminishing. Instead, investor
risk aversion is waning, and the focus is shifting toward improved earnings and
increasingly positive economic data.
Each of the Funds is poised to continue participation in future equity
gains and to outpace respective benchmarks. Following a bear market our research
shows that there is generally a sharp move upward in a relatively short amount
of time. We believe the recent rally in world equity markets is the beginning of
a more substantial period of appreciation.
As always, if we were to see anything ahead largely ignored by others that
we think indicates a high probability of substantial capital loss, we would take
appropriate defensive action. At the moment we look forward to a continued
period of prosperity for equity investors.
Thank you for your continued interest and support.
Sincerely,
Kenneth L. Fisher
Chairman and Chief Investment Officer
Fisher Investments, Inc.
Opinions expressed above are those of Kenneth L. Fisher and are subject to
change, are not guaranteed and should not be considered recommendations to buy
or sell any security.
Past performance does not guarantee future results. The investment return and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Fund holdings and sector
allocations are subject to change and are not recommendations to buy or sell any
security. The S&P 500 Index is a broad based unmanaged index of 500 stocks,
which is widely recognized as representative of the equity market in general.
One cannot invest directly in an index.
Mutual fund investing involves risk. Principal loss is possible. Foreign
investing involves special risks, including greater volatility and political,
economic and currency risks and differences in accounting methods.
This material must be preceded or accompanied by a prospectus. Please read it
carefully before you invest or send money.
Purisima Securities, LLC, Distributor, 08/03
PERFORMANCE SUMMARIES
FOR YEAR ENDED AUGUST 31, 2003
PURISIMA TOTAL RETURN FUND
GROWTH OF $10,000
PURISIMA TOTAL RETURN FUND CUMULATIVE TOTAL RETURN VERSUS MSCI WORLD INDEX
$10,000 INVESTED FROM INCEPTION ON 10/31/96 TO 8/31/03*
[GRAPH]
Total
Return MSCI World Index
- ----------------------------------------
31-Oct-96 10,000 10,000
30-Nov-96 10,260 10,558
31-Dec-96 10,100 10,387
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31-Jan-97 10,550 10,511
28-Feb-97 10,480 10,629
31-Mar-97 10,250 10,417
30-Apr-97 10,860 10,755
30-May-97 11,520 11,417
30-Jun-97 12,200 11,984
31-Jul-97 12,770 12,534
31-Aug-97 11,870 11,693
30-Sep-97 12,610 12,327
31-Oct-97 11,910 11,676
30-Nov-97 12,150 11,880
31-Dec-97 12,384 12,023
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31-Jan-98 12,755 12,356
28-Feb-98 13,576 13,190
31-Mar-98 14,228 13,745
30-Apr-98 14,709 13,877
31-May-98 14,568 13,701
30-Jun-98 14,929 14,024
31-Jul-98 14,929 13,999
31-Aug-98 12,494 12,130
30-Sep-98 12,845 12,343
31-Oct-98 14,157 13,456
30-Nov-98 15,199 14,254
31-Dec-98 16,035 14,948
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31-Jan-99 16,806 15,274
28-Feb-99 16,305 14,866
31-Mar-99 16,836 15,483
30-Apr-99 17,117 16,091
31-May-99 16,606 15,501
30-Jun-99 17,728 16,222
31-Jul-99 17,388 16,171
31-Aug-99 17,498 16,141
30-Sep-99 17,147 15,982
31-Oct-99 18,350 16,810
30-Nov-99 18,961 17,281
31-Dec-99 19,940 18,677
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31-Jan-00 19,037 17,605
29-Feb-00 19,198 17,651
31-Mar-00 20,321 18,869
30-Apr-00 19,709 18,069
31-May-00 19,398 17,610
30-Jun-00 20,351 18,200
31-Jul-00 19,378 17,685
31-Aug-00 19,709 18,258
30-Sep-00 18,887 17,285
31-Oct-00 18,957 16,993
30-Nov-00 18,235 15,959
31-Dec-00 18,461 16,215
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31-Jan-01 18,295 16,534
28-Feb-01 18,970 15,135
31-Mar-01 19,136 14,130
30-Apr-01 18,700 15,168
31-May-01 18,659 14,955
30-Jun-01 18,482 14,486
31-Jul-01 18,970 14,299
31-Aug-01 19,448 13,611
30-Sep-01 20,071 12,411
31-Oct-01 19,936 12,648
30-Nov-01 19,352 13,394
31-Dec-01 19,214 13,477
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31-Jan-02 19,145 13,067
28-Feb-02 19,594 12,952
31-Mar-02 19,214 13,549
30-Apr-02 19,433 13,064
31-May-02 18,937 13,086
30-Jun-02 17,832 12,291
31-Jul-02 16,323 11,253
31-Aug-02 16,196 11,273
30-Sep-02 14,341 10,031
31-Oct-02 15,136 10,771
30-Nov-02 16,092 11,350
31-Dec-02 14,994 10,799
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31-Jan-03 14,691 10,469
28-Feb-03 14,376 10,286
31-Mar-03 14,341 10,252
30-Apr-03 15,659 11,160
31-May-03 16,638 11,795
30-Jun-03 16,731 11,998
31-Jul-03 17,303 12,241
31-Aug-03 17,851 12,504
ONE-YEAR
Average Annual Total Return 2** 10.22%
FIVE-YEAR
Average Annual Total Return 2** 7.40%
SINCE INCEPTION (10/28/96)
Cumulative Total Return 1** 78.51%
Average Annual Total Return 2** 8.84%
Please note past performance is not predictive of future results. SHARE PRICE
AND RETURN WILL FLUCTUATE, AND INVESTORS MAY EXPERIENCE A GAIN OR LOSS WHEN THEY
SELL THEIR SHARES.TO OBTAIN A PROSPECTUS ON THE PURISIMA FUNDS PLEASE CALL
1-800/841-0199. THE PROSPECTUS CONTAINS MORE INFORMATION, INCLUDING THE
POLITICAL, ECONOMIC, CURRENCY RISKS AND POTENTIAL VOLATILITY OF FOREIGN
INVESTING. READ THE PROSPECTUS CAREFULLY BEFORE INVESTING.
1. Cumulative total return measures the change in value of an investment over
the periods indicated and reflects all fund fees and expenses.
2. Average annual total return represents the average annual change in value
of an investment over the periods indicated and reflects all fund fees and
expenses. Average annual total return and cumulative total return for the
one-year period would be identical.
* The Morgan Stanley MSCI World is obtained from Morgan Stanley and is an
unmanaged global stock index comprised of various world stock markets,
including the U.S. Purisima total return of a $10,000 investment includes
all expenses. Fund's month-end inception was 10/31/96 with actual inception
on 10/28/96.
+ The S&P 500 is obtained from Standard & Poors corp. It is an unmanaged
stock index that measures the performance of 500 large cap companies traded
in the U.S. Total return of a $10,000 investment in Purisima includes all
expenses. Fund's month-end inception was 9/30/98 with actual inception on
9/29/98.
++ The EAFE Index is obtained from Morgan Stanley. It is an unmanaged stock
index that measures the performance of selected stock markets outside the
U.S. Purisima total return of a $10,000 investment includes all expenses.
Fund's month-end inception was 9/30/98 with actual inception on 9/29/98.
** The Total Returns shown do not reflect the deduction of taxes a shareholder
would pay on fund distributions or redumption of fund shares.
* Purisima Securities, LLC Woodside, CA 94062
PURE AMERICAN FUND
GROWTH OF $10,000
PURE AMERICAN FUND CUMULATIVE TOTAL RETURN VERSUS S&P 500 INDEX
$10,000 INVESTED FROM INCEPTION ON 9/30/98 TO 8/31/03+
[GRAPH]
Pure
American S&P 500 Index
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30-Sep-98 10,000 10,000
31-Oct-98 11,190 10,812
30-Nov-98 11,920 11,467
31-Dec-98 12,810 12,128
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31-Jan-99 13,300 12,635
28-Feb-99 12,630 12,242
31-Mar-99 12,940 12,731
30-Apr-99 13,040 13,224
31-May-99 12,630 12,912
30-Jun-99 13,390 13,629
31-Jul-99 12,930 13,203
31-Aug-99 13,000 13,137
30-Sep-99 12,530 12,777
31-Oct-99 13,560 13,586
30-Nov-99 13,760 13,862
31-Dec-99 13,893 14,677
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31-Jan-00 13,433 13,940
29-Feb-00 12,333 13,677
31-Mar-00 13,553 15,014
30-Apr-00 13,533 14,563
31-May-00 13,463 14,264
30-Jun-00 13,843 14,616
31-Jul-00 13,413 14,388
31-Aug-00 13,493 15,282
30-Sep-00 13,423 14,475
31-Oct-00 13,803 14,414
30-Nov-00 13,333 13,278
31-Dec-00 13,275 13,343
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31-Jan-01 13,234 13,817
28-Feb-01 13,774 12,557
31-Mar-01 13,889 11,761
30-Apr-01 13,587 12,675
31-May-01 13,618 12,760
30-Jun-01 13,566 12,450
31-Jul-01 14,065 12,328
31-Aug-01 13,757 11,556
30-Sep-01 14,011 10,622
31-Oct-01 13,933 10,825
30-Nov-01 13,909 11,655
31-Dec-01 13,909 11,758
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31-Jan-02 13,851 11,586
28-Feb-02 14,118 11,363
31-Mar-02 13,851 11,790
30-Apr-02 13,828 11,075
31-May-02 13,491 10,993
30-Jun-02 12,668 10,211
31-Jul-02 11,867 9,415
31-Aug-02 11,844 9,476
30-Sep-02 10,498 8,446
31-Oct-02 11,160 9,190
30-Nov-02 11,763 9,731
31-Dec-02 11,048 9,160
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31-Jan-03 10,788 8,920
28-Feb-03 10,635 8,786
31-Mar-03 10,729 8,871
30-Apr-03 11,567 9,602
31-May-03 12,144 10,108
30-Jun-03 12,286 10,238
31-Jul-03 12,698 10,418
31-Aug-03 12,899 10,621
ONE-YEAR
Average Annual Total Return 2** 8.91%
SINCE INCEPTION (9/29/98)
Cumulative Total Return 1** 28.99%
Average Annual Total Return 2** 5.31%
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PURE FOREIGN FUND
GROWTH OF $10,000
PURE FOREIGN FUND CUMULATIVE TOTAL RETURN VERSUS EAFE FOREIGN INDEX
$10,000 INVESTED FROM INCEPTION ON 9/30/98 TO 8/31/03++
[GRAPH]
Pure
Foreign MSCI EAFE Index
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30-Sep-98 10,000 10,000
31-Oct-98 10,710 11,042
30-Nov-98 11,430 11,607
31-Dec-98 11,740 12,065
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31-Jan-99 12,150 12,028
28-Feb-99 11,750 11,742
31-Mar-99 12,350 12,232
30-Apr-99 12,740 12,727
31-May-99 12,320 12,072
30-Jun-99 13,210 12,543
31-Jul-99 13,410 12,915
31-Aug-99 13,520 12,963
30-Sep-99 13,660 13,094
31-Oct-99 14,190 13,585
30-Nov-99 14,980 14,056
31-Dec-99 17,132 15,318
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31-Jan-00 15,991 14,346
29-Feb-00 17,290 14,732
31-Mar-00 17,850 15,303
30-Apr-00 17,153 14,498
31-May-00 16,804 14,145
30-Jun-00 17,871 14,698
31-Jul-00 16,794 14,082
31-Aug-00 17,311 14,204
30-Sep-00 16,297 13,513
31-Oct-00 15,991 13,194
30-Nov-00 15,378 12,699
31-Dec-00 15,782 13,150
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31-Jan-01 15,815 13,154
28-Feb-01 16,428 12,170
31-Mar-01 16,643 11,343
30-Apr-01 16,245 12,123
31-May-01 16,234 11,674
30-Jun-01 16,127 11,194
31-Jul-01 16,503 11,001
31-Aug-01 17,233 10,722
30-Sep-01 17,536 9,636
31-Oct-01 17,491 9,883
30-Nov-01 17,399 10,248
31-Dec-01 17,328 10,308
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31-Jan-02 17,176 9,761
28-Feb-02 17,528 9,829
31-Mar-02 17,317 10,408
30-Apr-02 17,657 10,429
31-May-02 17,352 10,561
30-Jun-02 16,661 10,141
31-Jul-02 14,681 9,140
31-Aug-02 15,313 9,119
30-Sep-02 13,415 8,140
31-Oct-02 14,411 8,577
30-Nov-02 15,313 8,966
31-Dec-02 14,509 8,665
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31-Jan-03 14,059 8,303
28-Feb-03 13,621 8,113
31-Mar-03 13,378 7,954
30-Apr-03 14,606 8,734
31-May-03 15,457 9,263
30-Jun-03 15,859 9,487
31-Jul-03 16,528 9,717
31-Aug-03 16,990 9,951
ONE-YEAR
Average Annual Total Return 2** 10.95%
SINCE INCEPTION (9/29/98)
Cumulative Total Return 1** 69.90%
Average Annual Total Return 2** 11.37%
TOTAL RETURN FUND
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SCHEDULE OF INVESTMENTS AT AUGUST 31, 2003
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SHARES VALUE
================================================================================
COMMON STOCKS: 99.2%
AEROSPACE/DEFENSE EQUIPMENT: 2.5%
47,100 Lockheed Martin Corp. $ 2,412,933
46,600 United Technologies Corp. 3,739,650
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6,152,583
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AUTOMOTIVE: 4.0%
65,800 DaimlerChrysler AG 2,515,534
278,100 Delphi Corp. 2,519,586
217,000 Nissan Motor Co. Ltd. - ADR 4,708,900
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9,744,020
------------
BANKING: 13.7%
387,100 Banco Santander Central - ADR 3,321,318
94,700 Barclays Plc - ADR 2,801,226
39,500 Comerica, Inc. 1,948,930
148,500 Credit Suisse Group - ADR 4,673,295
45,000 HSBC Holdings Plc - ADR 2,894,400
432,500 Mitsubishi Tokyo Finance - ADR 2,538,775
16,000 National Australia Bank Ltd. - ADR 1,617,600
66,775 National City Corp. 2,115,432
126,996 San Paolo - IMI SpA - ADR 2,451,023
38,100 SunTrust Banks, Inc. 2,329,053
47,800 UBS AG 2,599,364
107,300 Washington Mutual, Inc. 4,182,554
------------
33,472,970
------------
CHEMICALS: 1.3%
87,225 Rohm & Haas Co. 3,168,884
------------
COMPUTERS: 4.2%
119,200 Dell Computer Corp.* 3,889,496
110,400 Electronic Data Systems Corp. 2,410,032
305,100 EMC Corp.* 3,890,025
------------
10,189,553
------------
ELECTRICAL EQUIPMENT: 3.8%
71,700 General Electric Co. 2,120,169
72,800 Hitachi Ltd. - ADR 3,977,792
240,700 Matsushita Electric Industrial Co., Ltd - ADR 3,083,367
------------
9,181,328
------------
FINANCIAL SERVICES: 2.9%
116,700 ING Groep N.V. - ADR 2,302,491
71,600 Lehman Brothers Holdings, Inc. 4,706,268
------------
7,008,759
------------
FOODS: 2.2%
135,800 Sara Lee Corp. 2,577,484
47,525 Unilever N.V. - ADR 2,660,449
------------
5,237,933
------------
HOUSEHOLD AUDIO & VIDEO EQUIPMENT: 0.8%
60,100 Sony Corp. - ADR 1,980,295
------------
SHARES VALUE
================================================================================
HOUSEHOLD PRODUCTS: 1.9%
47,700 Kimberly-Clark Corp. $ 2,437,947
24,600 Procter & Gamble Co. 2,147,334
------------
4,585,281
------------
INSURANCE: 5.7%
94,900 Allstate Corp. 3,392,675
41,544 American International Group, Inc. 2,474,776
158,800 Axa S.A. - ADR 2,823,464
42,200 CIGNA Corp. 2,012,096
64,800 Marsh & McLennan Co. 3,240,000
------------
13,943,011
------------
MACHINERY: 2.3%
77,600 Caterpillar, Inc. 5,574,008
------------
MEDIA: 3.2%
119,300 News Corporation Ltd. - ADR 4,097,955
181,900 Walt Disney Co. 3,728,950
------------
7,826,905
------------
MEDICAL INSTRUMENTS: 1.0%
51,200 Guidant Corp. 2,570,240
------------
MINING: 1.6%
45,400 Rio Tinto Plc - ADR 4,019,716
------------
MISCELLANEOUS MANFACTURING: 5.3%
150,200 Alcoa, Inc. 4,289,712
45,200 Illinois Tool Works 3,267,508
87,800 Siemens AG - ADR 5,468,184
------------
13,025,404
------------
OIL & GAS: 8.4%
67,000 Anadarko Petroleum Corp. 2,914,500
108,900 Baker Hughes, Inc. 3,643,794
69,100 BASF AG - ADR 3,202,785
42,100 ConocoPhillips 2,350,864
100,600 Royal Dutch Petroleum Co. - ADR 4,513,922
49,357 Total Fina S.A. - ADR 3,800,983
------------
20,426,848
------------
PAPER & FOREST PRODUCTS: 1.4%
83,300 International Paper Co. 3,377,815
------------
PHARMACEUTICALS: 5.7%
75,000 Astrazeneca Plc - ADR 2,973,750
52,276 Aventis - ADR 2,561,524
77,400 GlaxoSmithKline Plc - ADR 3,005,442
49,100 Johnson & Johnson 2,434,378
3,521 Medco Health Solutions, Inc.* 94,011
29,200 Merck & Co., Inc. 1,469,344
40,400 Novartis AG - ADR 1,493,588
------------
14,032,037
------------
PHOTOGRAPHY: 1.4%
112,200 Fuji Photo Film - ADR 3,376,098
------------
SHARES VALUE
================================================================================
RETAIL: 5.1%
126,900 Albertson's, Inc. $ 2,667,438
94,600 Costco Wholesale Corp.* 3,035,714
67,200 Lowe's Companies, Inc. 3,686,592
71,300 Sears, Roebuck & Co. 3,138,626
------------
12,528,370
------------
SEMICONDUCTORS: 5.8%
177,500 Intel Corp. 5,080,050
111,200 KLA-Tencor Corp.* 6,600,832
179,500 Micron Technology, Inc.* 2,577,620
------------
14,258,502
------------
SOFTWARE: 5.4%
95,400 First Data Corp. 3,663,360
104,200 Microsoft Corp. 2,763,384
320,800 Oracle Corp.* 4,099,824
263,000 Siebel Systems, Inc.* 2,651,040
------------
13,177,608
------------
TELECOMMUNICATIONS: 4.5%
42,200 Alltel Corp. 1,932,760
155,350 Bellsouth Corp. 3,914,820
88,600 BT Group Plc - ADR 2,600,410
73,561 Telefonica, S.A. - ADR 2,611,416
------------
11,059,406
------------
TELECOMMUNICATIONS EQUIPMENT: 1.0%
147,100 Nokia Corp. - ADR 2,396,259
------------
TRANSPORTATION: 1.4%
49,900 Fedex Corp. 3,348,290
------------
UTILITIES: 2.7%
93,400 Duke Energy Corp. 1,595,272
47,500 E. ON AG - ADR 2,467,150
85,700 Enel SpA - ADR 2,626,705
------------
6,689,127
------------
TOTAL COMMON STOCKS
(cost $243,616,716) 242,351,250
------------
SHORT-TERM INVESTMENT: 0.5%
1,145,120 SEI Daily Income Trust Government Class B 1,145,120
(cost $1,145,120)
TOTAL INVESTMENTS IN SECURITIES
(cost $244,761,836): 99.7% 243,496,370
Other Assets less Liabilities: 0.3% 639,871
------------
NET ASSETS: 100.0% $244,136,241
============
ADR - American depositary receipt.
* Non-income producing security.
See accompanying Notes to Financial Statements.
PURE AMERICAN FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS AT AUGUST 31, 2003
- --------------------------------------------------------------------------------
SHARES VALUE
================================================================================
COMMON STOCKS: 99.2%
AEROSPACE/DEFENSE EQUIPMENT: 3.0%
450 Lockheed Martin Corp. $ 23,053
650 Northrop Grumman Corp. 62,062
------------
85,115
------------
AUTOMOTIVE: 1.9%
6,000 Delphi Corp. 54,360
------------
BANKING: 8.0%
1,225 Bank of America Corp. 97,081
1,150 Comerica, Inc. 56,741
2,250 National City Corp. 71,280
------------
225,102
------------
CHEMICALS: 2.3%
1,750 Rohm & Haas Co. 63,577
------------
COMPUTER COMPONENTS & SOFTWARE: 6.3%
3,175 Cisco Systems, Inc.* 60,801
1,850 Microsoft Corp. 49,062
3,400 Siebel Systems, Inc.* 34,272
1,000 Veritas Software Corp.* 34,480
------------
178,615
------------
COMPUTERS: 7.8%
1,100 Dell Computer Corp.* 35,893
1,650 Electronic Data Systems Corp. 36,019
4,800 EMC Corp.* 61,200
600 IBM Corp. 49,206
9,500 Sun Microsystems, Inc.* 36,670
------------
218,988
------------
CONSUMER PRODUCTS: 2.5%
775 Coca Cola Co. (The) 33,728
625 Nike, Inc. - Class B 35,613
------------
69,341
------------
ELECTRICAL EQUIPMENT: 4.0%
1,600 General Electric Co. 47,312
675 Johnson Controls, Inc. 66,825
------------
114,137
------------
FINANCIAL SERVICES: 6.9%
1,466 Citigroup, Inc. 63,551
850 Fannie Mae 55,072
425 Lehman Brothers Holdings, Inc. 27,935
900 Merrill Lynch & Co., Inc. 48,402
------------
194,960
------------
SHARES VALUE
================================================================================
FOODS: 1.9%
2,800 Sara Lee Corp. $ 53,144
------------
HEALTH CARE EQUIPMENT: 2.0%
1,150 Medtronic, Inc. 57,017
------------
HOUSEHOLD PRODUCTS: 1.5%
475 Procter & Gamble Co. 41,463
------------
INSURANCE: 4.0%
487 American International Group 29,011
33 Berkshire Hathaway, Inc. - Class B* 83,490
------------
112,501
------------
MACHINERY: 3.0%
1,175 Caterpillar, Inc. 84,400
------------
MEDIA: 2.0%
2,800 Walt Disney Co. 57,400
------------
MISCELLANEOUS MANUFACTURING: 3.0%
600 3M Co. 85,482
------------
OIL & GAS: 6.5%
975 ChevronTexaco Corp. 71,048
925 ConocoPhillips 51,652
1,600 Exxon Mobil Corp. 60,320
------------
183,020
------------
PAPER & FOREST PRODUCTS: 2.1%
1,450 International Paper Co. 58,798
------------
PHARMACEUTICALS: 7.4%
750 Johnson & Johnson 37,185
850 Lilly (Eli) & Co. 56,551
114 Medco Health Solutions, Inc.* 3,044
950 Merck & Co., Inc. 47,804
1,325 Schering-Plough Corp. 20,127
1,000 Wyeth 42,850
------------
207,561
------------
RESTAURANTS: 2.1%
2,600 McDonald's Corp. 58,292
------------
RETAIL: 4.6%
925 Costco Wholesale Corp.* 29,683
1,250 Sears, Roebuck & Co. 55,025
750 Wal-Mart Stores, Inc. 44,378
------------
129,086
------------
SHARES VALUE
================================================================================
SEMI-CONDUCTORS: 5.9%
2,500 Intel Corp. $ 71,550
700 KLA-Tencor Corp.* 41,552
3,800 Micron Technology, Inc.* 54,568
------------
167,670
------------
TELECOMMUNICATIONS: 1.5%
1,650 BellSouth Corp. 41,580
------------
TOBACCO PRODUCTS: 1.4%
950 Altria Group, Inc. 39,159
------------
TRANSPORTATION: 5.4%
2,200 Burlington Northern Santa Fe Corp. 62,370
1,350 Fedex Corp. 90,585
------------
152,955
------------
UTILITIES: 2.2%
2,200 Southern Co. 62,436
------------
TOTAL COMMON STOCKS
(cost $2,878,583) 2,796,159
------------
SHORT-TERM INVESTMENT: 0.7%
19,050 SEI Daily Income Trust Government Class B 19,050
(cost $19,050) ------------
TOTAL INVESTMENTS IN SECURITIES
(cost $2,897,633): 99.9% 2,815,209
Other Assets less Liabilities: 0.1% 3,470
------------
NET ASSETS: 100% $ 2,818,679
============
* Non-income producing security.
See accoumpanying Notes to Financial Statements.
PURE FOREIGN FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS AT AUGUST 31, 2003
- --------------------------------------------------------------------------------
SHARES VALUE
================================================================================
COMMON STOCKS: 98.4%
AUSTRALIA: 6.3%
5,800 BHP Billiton Ltd. - ADR $ 82,766
350 National Australia Bank Ltd. - ADR 35,385
1,550 News Corp. Ltd. - ADR 53,242
------------
171,393
------------
DENMARK: 0.9%
700 Novo-Nordisk A/S - ADR 25,025
------------
FINLAND: 1.0%
1,700 Nokia Corp. - ADR 27,693
------------
FRANCE: 10.6%
800 Aventis S.A. - ADR 39,200
3,650 Axa S.A. - ADR 64,897
2,950 Groupe Danone - ADR 81,213
1,347 Total Fina S.A. - ADR 103,732
------------
289,042
------------
GERMANY: 10.1%
1,100 BASF AG - ADR 50,985
2,100 DaimlerChrysler AG 80,283
1,400 SAP AG - ADR 41,916
1,650 Siemens AG - ADR 102,762
------------
275,946
------------
ITALY: 4.5%
1,600 Enel SpA - ADR 49,040
2,506 San Paolo - IMI SpA - ADR 48,366
990 Telecom Italia SpA - ADR* 23,364
------------
120,770
------------
JAPAN: 18.9%
1,200 Canon, Inc. - ADR 58,152
2,600 Fuji Photo Film - ADR 78,234
1,600 Hitachi, Ltd. - ADR 87,424
600 Kyocera Corp. - ADR 37,998
5,400 Matsushita Electric Industrial Co., Ltd. - ADR 69,174
1,050 Millea Holdings, Inc. - ADR 53,697
2,900 Nissan Motor Co. Ltd. - ADR 62,930
2,000 Sony Corp. - ADR 65,900
------------
513,509
------------
SHARES VALUE
================================================================================
NETHERLANDS: 9.1%
2,598 ABN AMRO Holding N.V. - ADR $ 45,829
1,350 Akzo Nobel N.V. - SPON ADR 44,050
2,150 ING Groep N.V. - ADR 42,419
825 Royal Dutch Petroleum Co. - ADR 37,018
2,600 TPG N.V. - ADR 48,984
519 Unilever N.V. - ADR 29,054
------------
247,354
------------
NORWAY: 2.3%
1,200 Norsk Hydro A/S - ADR 62,760
------------
PORTUGAL: 1.5%
5,732 Portugal Telecom S.A. - ADR 41,614
------------
SPAIN: 6.6%
3,900 Banco Bilbao Vizcaya Argentaria S.A. - ADR 41,925
5,575 Banco Santander Central Hispano S.A. - ADR 47,834
2,600 Repsol S.A. - ADR 44,018
1,301 Telefonica, S.A. - ADR 46,186
------------
179,963
------------
SWEDEN: 3.0%
3,400 Volvo AB - ADR 82,790
------------
SWITZERLAND: 7.5%
5,200 Adecco S.A. - ADR 66,040
1,250 Novartis AG - ADR 46,213
1,700 UBS AG - ADR 92,446
------------
204,699
------------
UNITED KINGDOM: 16.1%
500 AstraZeneca Plc - ADR 19,825
1,900 Barclays Plc - ADR 56,202
500 BP Plc - ADR 20,860
1,000 BT Group Plc - ADR 29,350
2,750 Cadbury Schweppes Plc - ADR 67,595
550 GlaxoSmithKline Plc - ADR 21,357
1,150 HSBC Holdings Plc - ADR 73,968
700 National Grid Group - ADR 21,595
1,150 Rio Tinto Plc - ADR 101,821
2,400 Royal & Sun Alliance Insurance Group Plc - ADR 26,520
------------
439,093
------------
TOTAL COMMON STOCKS
(cost $2,710,140) 2,681,651
------------
SHARES VALUE
================================================================================
SHORT-TERM INVESTMENT: 0.4%
10,169 SEI Daily Income Trust Government Class B $ 10,169
(cost $10,169) ------------
TOTAL INVESTMENTS IN SECURITIES
(cost $2,720,309): 98.8% 2,691,820
Other Assets less Liabilities: 1.2% 33,706
------------
NET ASSETS: 100.0% $ 2,725,526
============
ADR - American depositary receipt.
* Non-income producing security.
See accompanying Notes to Financial Statements.
PURE FOREIGN FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS BY INDUSTRY at August 31, 2003
- --------------------------------------------------------------------------------
% OF
INDUSTRY NET ASSETS
================================================================================
Automobile Manufacturers 8.3%
Banking 12.8%
Chemicals 3.5%
Commercial Services 2.4%
Electric 5.8%
Electronics 1.4%
Financial Services 3.4%
Foods 6.5%
Home Furnishing 5.0%
Insurance 6.9%
Media 1.9%
Mining 6.8%
Miscellaneous Manufacturing 6.6%
Office/Business Equipment 2.1%
Oil & Gas 9.9%
Pharmaceuticals 5.6%
Software 1.5%
Telecommunications 6.2%
Transportation 1.8%
------------
TOTAL COMMON STOCK 98.4%
SHORT-TERM INVESTMENTS 0.4%
------------
TOTAL INVESTMENTS IN SECURITIES 98.8%
Other Assets less Liabilities 1.2%
------------
NET ASSETS 100.0%
============
See accompanying Notes to Financial Statements.
PURISIMA FUNDS
STATEMENTS OF ASSETS AND LIABILITIES AT AUGUST 31, 2003
========================================================================================================
TOTAL RETURN PURE AMERICAN PURE FOREIGN
FUND FUND FUND
-------------- -------------- --------------
ASSETS
Investments in securities, at cost $ 244,761,836 $ 2,897,633 $ 2,720,309
============== ============== ==============
Investments in securities, at value $ 243,496,370 $ 2,815,209 $ 2,691,820
Cash -- -- 24,495
Receivables:
Dividends and interest 615,110 5,580 8,015
Fund shares sold 447,257 -- --
Other assets 14,977 -- 4,579
-------------- -------------- --------------
Total Assets 244,573,714 2,820,789 2,728,909
-------------- -------------- --------------
LIABILITIES
Payable for fund shares redeemed 83,906 -- --
Accrued advisory fees (Note 3) 198,729 2,110 3,383
Accrued distribution fees (Note 4) 50,128 -- --
Accrued administration fees (Note 3) 19,066 -- --
Other accrued expenses 85,644 -- --
-------------- -------------- --------------
Total Liabilities 437,473 2,110 3,383
-------------- -------------- --------------
NET ASSETS $ 244,136,241 $ 2,818,679 $ 2,725,526
============== ============== ==============
Number of shares issued and outstanding
(unlimited shares authorized, $0.01 par value) 15,945,893 257,535 193,277
============== ============== ==============
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE
PER SHARE $ 15.31 $ 10.94 $ 14.10
============== ============== ==============
COMPONENTS OF NET ASSETS
Paid-in capital $ 257,908,794 $ 3,123,233 $ 3,065,330
Accumulated net investment income 1,073,550 12,758 54,360
Accumulated net realized loss on investments (13,580,637) (234,888) (365,675)
Net unrealized depreciation on investments (1,265,466) (82,424) (28,489)
-------------- -------------- --------------
Net assets $ 244,136,241 $ 2,818,679 $ 2,725,526
============== ============== ==============
See accompanying Notes to Financial Statements.
PURISIMA FUNDS
STATEMENTS OF OPERATIONS FOR THE YEAR ENDED AUGUST 31, 2003
============================================================================================================
TOTAL RETURN PURE AMERICAN PURE FOREIGN
FUND FUND FUND
-------------- -------------- --------------
INVESTMENT INCOME
Income
Dividends (net of foreign taxes witheld
of $377,433, $0, and $11,605, respectively) $ 4,013,399 $ 49,527 $ 100,889
Interest 10,445 123 118
-------------- -------------- --------------
Total income 4,023,844 49,650 101,007
-------------- -------------- --------------
Expenses
Advisory fees 1,964,219 36,892 42,595
Distribution fees 491,055 -- --
Administration fees 192,285 -- --
Transfer agent fees 142,863 -- --
Fund accounting fees 78,525 -- --
Custody fees 49,377 -- --
Registration fees 47,156 -- --
Reports to shareholders 37,502 -- --
Insurance expense 31,492 -- --
Legal fees 18,468 -- --
Audit fees 14,998 -- --
Trustee fees 3,074 -- --
Miscellaneous 5,812 -- --
-------------- -------------- --------------
Total expenses 3,076,826 36,892 42,595
Less: fees waived (Note 3) (129,719) -- --
-------------- -------------- --------------
Net expenses 2,947,107 36,892 42,595
-------------- -------------- --------------
NET INVESTMENT INCOME 1,076,737 12,758 58,412
-------------- -------------- --------------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Net realized gain (loss) on investments:
Securities (4,677,248) (209,661) (348,963)
Options 4,958 -- --
Net unrealized appreciation on investments 27,195,122 386,082 488,304
-------------- -------------- --------------
Net realized and unrealized gain on investments 22,522,832 176,421 139,341
-------------- -------------- --------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 23,599,569 $ 189,179 $ 197,753
============== ============== ==============
See accompanying Notes to Financial Statements.
PURISIMA FUNDS
STATEMENT OF CHANGES IN NET ASSETS
================================================================================
TOTAL RETURN FUND
YEAR ENDED YEAR ENDED
INCREASE (DECREASE) IN NET ASSETS FROM: AUGUST 31, 2003 AUGUST 31, 2002
-------------- --------------
OPERATIONS
Net investment income $ 1,076,737 $ 1,701,906
Net realized gain (loss) on investments
Securities (4,677,248) (4,615,141)
Options 4,958 558,434
Net unrealized appreciation (depreciation)
on investments 27,195,122 (31,931,932)
-------------- --------------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 23,599,569 (34,286,733)
-------------- --------------
DISTRIBUTION TO SHAREHOLDERS
From net investment income (649,922) (1,395,913)
From net realized gain (1,595,178) (12,127,092)
-------------- --------------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS (2,245,100) (13,523,005)
-------------- --------------
CAPITAL SHARE TRANSACTIONS
Net increase in net assets derived from
net change in outstanding shares (a) 41,210,454 107,016,302
-------------- --------------
TOTAL INCREASE IN NET ASSETS 62,564,923 59,206,564
NET ASSETS
Beginning of year 181,571,318 122,364,754
-------------- --------------
END OF YEAR $ 244,136,241 $ 181,571,318
============== ==============
Accumulated net investment income $ 1,073,550 $ 646,735
============== ==============
(a) A summary of capital share transactions is as follows:
YEAR ENDED YEAR ENDED
AUGUST 31, 2003 AUGUST 31, 2002
--------------------------------- ---------------------------------
SHARES VALUE SHARES VALUE
-------------- -------------- -------------- --------------
Shares sold 5,057,337 $ 68,171,437 7,196,010 $ 119,292,657
Shares issued on reinvestment
of distributions 167,234 2,202,476 794,173 13,397,691
Shares redeemed (2,195,711) (29,163,459) (1,606,721) (25,674,046)
-------------- -------------- -------------- --------------
Net increase 3,028,860 $ 41,210,454 6,383,462 $ 107,016,302
============== ============== ============== ==============
See accompanying Notes to Financial Statements.
PURISIMA FUNDS
STATEMENT OF CHANGES IN NET ASSETS
================================================================================
PURE AMERICAN FUND
YEAR ENDED YEAR ENDED
INCREASE (DECREASE) IN NET ASSETS FROM: AUGUST 31, 2003 AUGUST 31, 2002
-------------- --------------
OPERATIONS
Net investment income $ 12,758 $ 41,317
Net realized loss on investments :
Securities (209,661) (8,289)
Options -- (16,938)
Net unrealized appreciation (depreciation)
on investments 386,082 (466,565)
-------------- --------------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 189,179 (450,475)
-------------- --------------
DISTRIBUTION TO SHAREHOLDERS
From net investment income (41,305) (114,026)
From net realized gain -- (39,141)
-------------- --------------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS (41,305) (153,167)
-------------- --------------
CAPITAL SHARE TRANSACTIONS
Net increase (decrease) in net assets
derived from net change in outstanding
shares (a) 53,362 (1,283,697)
-------------- --------------
TOTAL INCREASE (DECREASE) IN NET ASSETS 201,236 (1,887,339)
NET ASSETS
Beginning of year 2,617,443 4,504,782
-------------- --------------
END OF YEAR $ 2,818,679 $ 2,617,443
============== ==============
Accumulated net investment income $ 12,758 $ 41,305
============== ==============
(a) A summary of capital share transactions is as follows:
YEAR ENDED YEAR ENDED
AUGUST 31, 2003 AUGUST 31, 2002
--------------------------------- ---------------------------------
SHARES VALUE SHARES VALUE
-------------- -------------- -------------- --------------
Shares sold 67,395 $ 667,749 115,219 $ 1,407,861
Shares issued on reinvestment
of distributions 4,325 41,305 12,420 148,667
Shares redeemed (70,463) (655,692) (233,282) (2,840,225)
-------------- -------------- -------------- --------------
Net increase (decrease) 1,257 $ 53,362 (105,643) $ (1,283,697)
============== ============== ============== ==============
See accompanying Notes to Financial Statements.
PURISIMA FUNDS
STATEMENT OF CHANGES IN NET ASSETS
================================================================================
PURE FOREIGN FUND
YEAR ENDED YEAR ENDED
INCREASE (DECREASE) IN NET ASSETS FROM: AUGUST 31, 2003 AUGUST 31, 2002
-------------- --------------
OPERATIONS
Net investment income $ 58,412 $ 167,727
Net realized gain (loss) on investments:
Securities (348,963) 7,820
Options -- (23,081)
Net unrealized appreciation (depreciation)
on investments 488,304 (591,908)
-------------- --------------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 197,753 (439,442)
-------------- --------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income (122,709) (190,682)
From net realized gain -- --
-------------- --------------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS (122,709) (190,682)
-------------- --------------
CAPITAL SHARE TRANSACTIONS
Net decrease in net assets derived from
net change in outstanding shares (a) (743,643) (4,877,317)
-------------- --------------
TOTAL DECREASE IN NET ASSETS (668,599) (5,507,441)
NET ASSETS
Beginning of year 3,394,125 8,901,566
-------------- --------------
END OF YEAR $ 2,725,526 $ 3,394,125
============== ==============
Accumulated net investment income $ 54,360 $ 118,657
============== ==============
(a) A summary of capital share transactions is as follows:
YEAR ENDED YEAR ENDED
AUGUST 31, 2003 AUGUST 31, 2002
--------------------------------- ---------------------------------
SHARES VALUE SHARES VALUE
-------------- -------------- -------------- --------------
Shares sold 32,333 $ 395,974 54,423 $ 834,081
Shares issued on reinvestment
of distributions 10,175 122,709 12,224 181,160
Shares redeemed (108,954) (1,262,326) (386,039) (5,892,558)
-------------- -------------- -------------- --------------
Net decrease (66,446) $ (743,643) (319,392) $ (4,877,317)
============== ============== ============== ==============
See accompanying Notes to Financial Statements.
PURISIMA FUNDS
FINANCIAL HIGHLIGHTS FOR A CAPITAL SHARE OUTSTANDING THROUGHOUT EACH YEAR.
================================================================================
THE FOLLOWING INFORMATION SHOULD BE READ IN CONJUNCTION WITH THE FINANCIAL
STATEMENTS AND NOTES THERETO APPEARING ELSEWHERE IN THIS ANNUAL REPORT.
TOTAL RETURN FUND
----------------------------------------------------------------
YEAR ENDED AUGUST 31,
----------------------------------------------------------------
2003 2002 2001 2000 1999
-------- -------- -------- -------- --------
Net asset value, beginning of year $ 14.06 $ 18.73 $ 19.65 $ 17.46 $ 12.47
-------- -------- -------- -------- --------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) 0.07 0.09 0.31 ^ (0.01) (0.01)
Net realized and unrealized gain (loss)
on investments 1.34 (2.91) (0.61)^ 2.22 5.00
-------- -------- -------- -------- --------
Total from investment operations 1.41 (2.82) (0.30)^ 2.21 4.99
-------- -------- -------- -------- --------
LESS DISTRIBUTIONS:
From net investment income (0.05) (0.19) -- (0.02) --
From net realized gain (0.11) (1.66) (0.62) -- --
-------- -------- -------- -------- --------
Total distributions (0.16) (1.85) (0.62) (0.02) --
-------- -------- -------- -------- --------
Net asset value, end of year $ 15.31 $ 14.06 $ 18.73 $ 19.65 $ 17.46
======== ======== ======== ======== ========
Total return 10.22% (16.72%) (1.33%) 12.64% 40.05%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of year (millions) $ 244.1 $ 181.6 $ 122.4 $ 89.8 $ 53.2
RATIO OF EXPENSES TO AVERAGE NET ASSETS:
Before fees waived and expenses absorbed or recouped 1.56% 1.51% + 1.61% + 1.62% 1.82%
After fees waived and expenses absorbed or recouped 1.50% 1.50% + 1.50% + 1.50% 1.50%
RATIO OF NET INVESTMENT INCOME (LOSS)
TO AVERAGE NET ASSETS # 0.55% 1.03% 1.68% (0.04%) 0.00%
Portfolio turnover rate 12.57% 60.76% 105.90% 38.42% 12.72%
# Net of fees waived.
^ Calculations are based on average shares outstanding for the period.
+ Without dividend expense on securities sold short, which was 0.10% for 2002
and 0.05% for 2001.
See accompanying Notes to Financial Statements.
PURISIMA FUNDS
FINANCIAL HIGHLIGHTS FOR A CAPITAL SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
================================================================================
THE FOLLOWING INFORMATION SHOULD BE READ IN CONJUNCTION WITH THE FINANCIAL
STATEMENTS AND NOTES THERETO APPEARING ELSEWHERE IN THIS ANNUAL REPORT.
PURE AMERICAN FUND
-------------------------------------------------------------------
SEPTEMBER 29,
YEAR ENDED AUGUST 31, 1998+
-------------------------------------------------- THROUGH
AUGUST 31,
2003 2002 2001 2000 1999
-------- -------- -------- -------- --------
Net asset value, beginning of period $ 10.21 $ 12.45 $ 13.49 $ 13.00 $ 10.00
-------- -------- -------- -------- --------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) 0.05 0.43 0.28 ^ (0.03) (0.02)
Net realized and unrealized gain
(loss) on investments 0.84 (2.07) (0.02) ^ 0.52 3.02
-------- -------- -------- -------- --------
Total from investment operations 0.89 (1.64) 0.26 ^ 0.49 3.00
-------- -------- -------- -------- --------
LESS DISTRIBUTIONS:
From net investment income (0.16) (0.58) (0.28) -- --
From net realized gain -- (0.02) (1.02) (0.00)++ --
-------- -------- -------- -------- --------
Total distributions (0.16) (0.60) (1.30) (0.00)++ --
-------- -------- -------- -------- --------
Net asset value, end of period $ 10.94 $ 10.21 $ 12.45 $ 13.49 $ 13.00
======== ======== ======== ======== ========
Total return 8.91% (13.90%)1 1.96% 1 3.79% 30.00% **
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (millions) $ 2.8 $ 2.6 $ 4.5 $ 1.1 $ 1.5
RATIO OF EXPENSES TO AVERAGE NET ASSETS:
Before fees waived 1.50% 1.50% + 1.50% + 1.50% 1.50% *
After fees waived n/a 1.13% + 1 0.00% + 1 n/a n/a
RATIO OF NET INVESTMENT INCOME (LOSS)
TO AVERAGE NET ASSETS 0.52% 1.35% 4.09% (0.13%) (0.34%)*
Portfolio turnover rate 31.47% 75.54% 265.29% 45.48% 29.73% **
* Annualized.
** Not Annualized.
+ Commencement of operations. ++ Amount represents less than $0.01 per share.
^ Calculations are based on average shares outstanding for the period.
+ Without dividend expense on securities sold short, which was 0.06% for 2002
and 0.08% for 2001.
1 The Adviser voluntarily waived all of its management fees for the period
December 21, 2000 to December 1, 2001.
See accompanying Notes to Financial Statements.
PURISIMA FUNDS
FINANCIAL HIGHLIGHTS FOR A CAPITAL SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
================================================================================
THE FOLLOWING INFORMATION SHOULD BE READ IN CONJUNCTION WITH THE FINANCIAL
STATEMENTS AND NOTES THERETO APPEARING ELSEWHERE IN THIS ANNUAL REPORT.
PURE FOREIGN FUND
------------------------------------------------------------------
SEPTEMBER 29,
1998+
YEAR ENDED AUGUST 31, THROUGH
-------------------------------------------------- AUGUST 31,
2003 2002 2001 2000 1999
-------- -------- -------- -------- --------
Net asset value, beginning of period $ 13.07 $ 15.37 $ 16.39 $ 13.52 $ 10.00
-------- -------- -------- -------- --------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.28 0.84 0.33 ^ 0.01 0.04
Net realized and unrealized gain (loss)
on investments 1.21 (2.47) (0.45)^ 3.69 3.48
-------- -------- -------- -------- --------
Total from investment operations 1.49 (1.63) (0.12)^ 3.70 3.52
-------- -------- -------- -------- --------
LESS DISTRIBUTIONS:
From net investment income (0.46) (0.67) (0.35) (0.03) --
From net realized gain -- -- (0.55) (0.80) --
-------- -------- -------- -------- --------
Total distributions (0.46) (0.67) (0.90) (0.83) --
-------- -------- -------- -------- --------
Net asset value, end of period $ 14.10 $ 13.07 $ 15.37 $ 16.39 $ 13.52
======== ======== ======== ======== ========
Total return 10.95% (11.14%) (0.45%) 28.04% 35.20% **
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (millions) $ 2.7 $ 3.4 $ 8.9 $ 2.8 $ 0.3
RATIO OF EXPENSES TO AVERAGE NET ASSETS:
Before fees waived 1.50% 1.50% + 1.50% + 1.50% 1.50% *
After fees waived n/a 1.07% + 0.00% + n/a n/a
RATIO OF NET INVESTMENT INCOME
TO AVERAGE NET ASSETS 2.06% 4.02% 4.21% 0.26% 0.65% *
Portfolio turnover rate 22.02% 69.59% 258.66% 51.60% 7.19% **
* Annualized.
** Not Annualized.
+ Commencement of operations.
^ Calculations are based on average shares outstanding for the period.
+ Without dividend expense on securities sold short, which was 0.05% for 2002
and 0.08% for 2001.
See accompanying Notes to Financial Statements.
PURISIMA FUNDS
NOTES TO FINANCIAL STATEMENTS
August 31, 2003
NOTE 1 - ORGANIZATION
The Purisima Funds (the "Trust") was organized as a Delaware business trust on
June 27, 1996 and is registered under the Investment Company Act of 1940, as
amended (the "1940 Act") as an open-end management investment company issuing
its shares in series. Each series represents a distinct portfolio with its own
investment objectives and policies. The Trust consists of three diversified
series (the "Funds"): Purisima Total Return Fund (the "Total Return Fund"),
representing the initial series of the Trust which commenced operations on
October 28, 1996, and Purisima Pure American Fund (the "Pure American Fund") and
Purisima Pure Foreign Fund (the "Pure Foreign Fund") both of which commenced
operations on September 29, 1998. Fisher Investments, Inc. (the "Adviser")
serves as the investment adviser to the Funds.
The investment objectives of the Funds are as follows:
The Total Return Fund seeks to produce a high level of total return. It invests
primarily in common stocks and other equity-type securities, or securities
acquired primarily to produce income, or a combination of both depending on the
assessment of market conditions.
The Pure American Fund seeks to provide investors with a high level of total
return. The Fund may emphasize investments in common stocks and other
equity-type securities acquired primarily to produce income, or a combination of
both, depending on the assessment of market conditions by the Fund's Investment
Adviser. The Fund will concentrate its portfolio holdings to those securities
issued by issuers domiciled in the United States.
The Pure Foreign Fund seeks to provide investors with a high level of total
return. The Fund may emphasize investments in common stocks and other
equity-type securities acquired primarily to produce income, or a combination of
both, depending on the assessment of market conditions by the Fund's Investment
Adviser. Under normal market conditions, the Fund will concentrate its portfolio
holdings to those securities issued by issuers domiciled outside of the United
States.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Funds in the preparation of their financial statements. These
policies are in conformity with accounting principles generally accepted in the
United States of America.
A. Security Valuation. Investments in securities traded on a national
securities exchange are valued at the last sales price on the business
day as of which such value is being determined. Investments in
securities traded on the Nasdaq Stock Market, Inc. ("Nasdaq") will be
valued at the Nasdaq Official Closing Price, which may not necessarily
represent the last sale price. Securities traded on an exchange or
Nasdaq for which there have been no sales and other over-the-counter
securities are valued at the closing bid. Securities for which
quotations are not
PURISIMA FUNDS
readily available are valued at their respective fair values as
determined in good faith by the Board of Trustees or their designee.
Debt securities with remaining maturities of 60 days or less are
valued at cost which, when combined with accrued interest,
approximates market value. Discounts and Premiums on securities
purchased are amortized over the lives of the respective securities
using the straight-line method.
B. Federal Income and Excise Taxes. The Funds intend to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of their
income to its shareholders. Therefore, no federal income or excise tax
provision is required.
As of August 31, 2003, the Total Return Fund has a capital loss
carryforward available to offset future capital gains, if any, of
$11,619,847, all of which expires in 2011. The Pure American Fund has
a capital loss carryforward available to offset future capital gains,
if any, of $31,418, of which $19,013 expires in 2011 and $12,405
expires in 2010, and the Pure Foreign Fund has a capital loss
carryforward available to offset future capital gains, if any, of
$144,958, of which $770 expires in 2010 and $144,188 expires in 2011.
In addition, the Total Return Fund, Pure American Fund and Pure
Foreign Fund had net realized capital losses of $1,782,053, $184,040
and $218,152, respectively, during the period November 1, 2002 through
August 31, 2003, which are treated for federal income tax purposes as
arising during the Funds' tax year ending August 31, 2004. These
"post-October" losses may be utilized in future years to offset net
realized capital gains prior to distributing such gains to
shareholders.
C. Security Transactions, Investment Income and Distributions. Security
transactions are accounted for on the trade date. Dividend income and
distributions to shareholders are recorded on the ex-dividend date and
interest income is recognized on the accrual basis.
D. Use of estimates. The presentation of financial statements in
conformity with accounting principles generally accepted in the United
States of America requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities
at the date of the financial statements and the reported amounts of
revenue and expenses during the reporting period. Actual results could
differ from those estimates and assumptions.
E. Concentration of Risk. Investments in securities of non-U.S. issues in
certain countries involve special investment risks. These risks may
include but are not limited to, investment restrictions, adverse
political, social and economic developments, government involvement in
the private sector, limited and less reliable investor information,
lack of liquidity, certain local tax law considerations, and limited
regulation of the securities markets.
F. Options. Options purchased are recorded as investments; options
written (sold) are accounted for as liabilities. When an option
expires, the premium (original option value) is realized as a gain if
the option was written or as a loss if the option was purchased. When
the exercise of an option result in a cash settlement, the difference
between the premium and the settlement proceeds is realized as a gain
or loss. When securities are acquired or delivered upon exercise
PURISIMA FUNDS
of an option, the acquisition cost or sale proceeds are adjusted by
the amount of the premium. When an option is closed, the difference
between the premium and the cost to close the position is realized as
a gain or loss.
G. Securities Sold Short. The Funds engage in selling securities short,
which obligates the Funds to replace a security borrowed by purchasing
the same security at the current market value. The Funds would incur a
loss if the price of the security increases between the date of the
short sale and the date on which the Funds replace the borrowed
security. The Funds would realize a gain if the price of the security
declines between those dates.
The Funds are required to establish a margin account with the broker
lending the security sold short. While the short sale is outstanding,
the broker retains the proceeds of the short sale and the Funds must
also maintain a deposit with the broker consisting of cash having a
value equal to a specified percentage of the value of the securities
sold short.
NOTE 3 - COMMITMENTS AND OTHER RELATED PARTY TRANSACTIONS
The Total Return Fund (the "Fund") has an Investment Management Agreement with
the Adviser to provide investment advisory services to the Fund. The Adviser
furnishes all investment advice, office space, facilities, and most of the
personnel needed by the Funds. As compensation for its services, the Adviser is
entitled to a monthly fee at the annual rate of 1.00% of the Fund's average
daily net assets.
The Fund is responsible for its own operating expenses. The Adviser has agreed
to limit the Fund's total expenses (exclusive of brokerage, interest, taxes,
dividends on securities sold short and extraordinary expenses) to not more than
1.50% of the average daily net assets.
Any fee withheld or voluntarily reduced and/or any Fund expense absorbed by the
Adviser pursuant to an agreed upon expense cap shall be reimbursed by the Fund
to the Adviser, if so requested by the Adviser, anytime before the end of the
third fiscal year following the year to which the fee reduction, waiver, or
expense absorption relates, provided the aggregate amount of the Fund's current
operating expenses for such fiscal year does not exceed the applicable
limitation on Fund expenses. Any such reimbursement is also contingent upon
Board of Trustees review and approval prior to the time the reimbursement is
also initiated. The Fund must pay its current ordinary operating expenses before
the Adviser is entitled to any reimbursement of fees and/or expenses. For the
year ended August 31, 2003, the Adviser waived fees of $129,719.
PURISIMA FUNDS
At August 31, 2003, the cumulative unreimbursed amount paid and/or waived by the
Adviser on behalf of the Fund is $243,700. The Adviser may recapture $102,939 no
later than August 31, 2004, $11,042 no later than August 31, 2005 and $129,719
no later than August 31, 2006.
The Pure American and Pure Foreign Funds have a Comprehensive Management
Agreement with the Adviser to provide advisory and other ordinary services,
including administration, transfer agency, custody and auditing services. For
providing these services, the Pure American and Pure Foreign Funds each pay the
Adviser a monthly fee at the annual rate of 1.50% of the respective Funds'
average daily net assets. This comprehensive fee arrangement requires the
Adviser to absorb and pay out of its own resources all operating expenses of the
Pure American and Pure Foreign Funds
U.S. Bancorp Fund Services, LLC (the "Administrator") acts as the Trust's
Administrator under an Administration Agreement. The Administrator prepares
various federal and state regulatory filings, reports and returns for the Funds;
prepares reports and materials to be supplied to the trustees; monitors the
activities of the Funds' custodian, transfer agent and accountants; coordinates
the preparation and payment of Fund expenses and reviews the Funds' expense
accruals.
For its services, the Administrator receives a monthly fee based on the value of
the total average net assets of the Trust at an annual rate of 0.10% of the
first $200 million of such net assets, 0.05% of the next $300 million, and 0.03%
thereafter, subject to a minimum fee of $40,000 per Fund.
NOTE 4 - SERVICE AND DISTRIBUTION PLAN
The Trust has adopted a Service and Distribution Plan (the "Plan") pursuant to
Rule 12b-1 under the 1940 Act. Under the Plan, the Total Return Fund is
authorized to pay expenses incurred for the purpose of financing activities,
including the employment of other dealers, intended to result in the sale of
shares of the Fund. The fee accrues at an annual rate not to exceed 0.25% of the
Fund's average daily net assets. For the year ended August 31, 2003, the Fund
incurred $491,055 in distribution fees.
PURISIMA FUNDS
NOTE 5 - PURCHASES AND SALES
The cost of purchases and the proceeds from sales of securities, excluding
short-term investments, for the year ended August 31, 2003 were as follows:
FUND PURCHASES SALES
---- --------- -----
Excluding U.S. Government securities:
Total Return Fund $ 66,057,525 $ 24,479,384
Pure American Fund 786,262 771,659
Pure Foreign Fund 622,145 1,449,954
U.S. Government securities:
Total Return Fund -- --
Pure American Fund 6,831 --
Pure Foreign Fund -- --
NOTE 6 - DISTRIBUTION TO SHAREHOLDERS
As of August 31, 2003, the components of distributable earnings on a tax basis
were as follows:
Total Return Pure American Pure Foreign
----------------------------------------------------
COST OF INVESTMENTS FOR TAX PURPOSES $ 244,940,573 $ 2,917,063 $ 2,722,874
----------------------------------------------------
Gross tax unrealized appreciation $ 20,427,426 $ 169,566 $ 177,256
Gross tax unrealized depreciation ($ 21,871,629) ($ 271,420) ($ 208,310)
----------------------------------------------------
Net tax unrealized depreciation ($ 1,444,203) ($ 101,854) ($ 31,054)
====================================================
UNDISTRIBUTED ORDINARY INCOME $ 1,073,550 $ 12,758 $ 54,360
CAPITAL LOSS CARRYFORWARD ($ 11,619,847) ($ 31,418) ($ 144,958)
POST-OCTOBER LOSSES ($ 1,782,053) ($ 184,040) ($ 218,152)
The tax composition of dividends are as follows:
Long Term
Ordinary Income Long Term Capital Gains
Income Per Share Capital Gains Per Share
----------------------------------------------------
Total Return Fund
8/31/2003 $ 649,922 $ 0.0465 $1,595,178 $ 0.1141
8/31/2002 5,260,462 0.7179 8,262,543 1.1276
Pure American Fund
8/31/2003 41,305 0.1565 -- --
8/31/2002 148,984 0.5806 4,183 0.0163
Pure Foreign Fund
8/31/2003 122,709 0.4583 -- --
8/31/2002 190,682 0.6665 -- --
PURISIMA FUNDS
OTHER INFORMATION - UNAUDITED
For dividends declared after December 31, 2002, from net investment income under
the Jobs and Growth Tax Relief Reconciliation Act of 2003, the Funds designate
the following percentages:
--------------------------------------------------
Total Return Fund 95.27
--------------------------------------------------
Pure American Fund 95.76%
--------------------------------------------------
Pure Foreign Fund 97.44%
--------------------------------------------------
OTHER INFORMATION - TRUSTEES AND OFFICER INFORMATION
(Unaudited)
Number of
Portfolios
in Fund Other
Position(s) Complex Director-
Held Year Principal Overseen by ships
Name, Address, Age with Trust Elected1 Occupation(s) During Past Five Years Director Held
------------------ ---------- -------- ------------------------------------ -------- ----
Kenneth L. Fisher* (53) President 1996 Chief Executive Officer and majority 3 None
Fisher Investments, Inc. and Trustee shareholder of the Adviser, and has served
13100 Skyline Blvd. in such capacities since the incorporation
Woodside, CA 94062 of the Adviser in 1986. Prior thereto, he
was the founder of Fisher Investments, a
sole proprietorship which commenced
operations in 1978.
Sherrilyn A. Fisher* (54) Secretary 1996 Senior Vice President and Corporate N/A None
Fisher Investments, Inc. Secretary of the Adviser. Ms. Fisher has
13100 Skyline Blvd. been employed by the Adviser since 1986.
Woodside, CA 94062
David Ruiz (38) Treasurer 2003 Controller, Fisher Investments, Inc., since N/A None
Fisher Investments, Inc. July of 2001. Prior thereto, served as
13100 Skyline Blvd. Controller for Secure.com (internet related
Woodside, CA 94062 products) while providing consulting
services for Agilent Technologies. Prior to
the year 2000, served as the Chief Financial
Officer for Nomura Securities in Dallas,
Texas.
Pierson E. Clair III (55) Trustee 1996 President and Chief Operating Officer of 3 Signature
Fisher Investments, Inc. Brown & Haley since 1998 (fine Foods, Inc.
13100 Skyline Blvd. confectioners); Vice President of Blummer
Woodside, CA 94062 Chocolate Company from 1980 to 1997, where
he had been employed since 1970.
Bryan F. Morse (51) Trustee 1996 Sole proprietor of Bryan F. Morse, RIA, a 3 None
Fisher Investments, Inc. registered investment adviser since 1990.
13100 Skyline Blvd.
Woodside, CA 94062
Grover T. Wickersham (54) Trustee 1996 Attorney in private practice in Palo Alto, 3 None
Fisher Investments, Inc. California. Prior to entering private
13100 Skyline Blvd. practice in June of 1981, served as a Branch
Woodside, CA 94062 Chief of the Los Angeles Regional Office of
the U.S. Securities and Exchange Commission.
Scott LeFevre (46) Trustee 2001 Sole proprietor of LeFevre Capital 3 None
Fisher Investments, Inc. Management.
13100 Skyline Blvd.
Woodside, CA 94062
Alfred D. McKelvy, Jr. (54) Trustee 2003 Executive Director of the law firm of 3 Diablo
Fisher Investments, Inc. Berding & Weil, LLP since 1990. Valley
13100 Skyline Blvd. Bank; East
Woodside, CA 94062 Bay BOMA.
- ----------------------------
1 Trustees and officers of the Funds serve until their resignation, removal or
retirement.
* "Interested person" of the Trust, as defined in the 1940 Act.
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
TO THE SHAREHOLDERS AND BOARD OF TRUSTEES
PURISIMA FUNDS
WOODSIDE, CALIFORNIA
We have audited the accompanying statement of assets and liabilities, including
the schedule of investments of the Purisima Total Return Fund, the Purisima Pure
American Fund, and the Purisima Pure Foreign Fund, each a series of shares of
the Purisima Funds, as of August 31, 2003, and the related statement of
operations for the year then ended, the statements of changes in net assets for
each of the two years in the period then ended and the financial highlights
indicated thereon. These financial statements and financial highlights are the
responsibility of the Funds' management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included confirmation of
securities owned as of August 31, 2003, by correspondence with the custodian. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly in all material respects, the financial position of the
Purisima Total Return Fund, the Purisima Pure American Fund, and the Purisima
Pure Foreign Fund as of August 31, 2003, the results of their operations for the
year then ended, the changes in their net assets for each of the two years in
the period then ended and the financial highlights indicated thereon, in
conformity with accounting principles generally accepted in the United States of
America.
TAIT, WELLER & BAKER
PHILADELPHIA, PENNSYLVANIA
SEPTEMBER 26, 2003
PRIVACY NOTICE
Fisher Investments, Inc. and The Purisima Funds collect nonpublic information
about you from the following sources:
o Information we receive about you on applications or other forms;
o Information you give us orally; and
o Information about your transactions with us or others.
We do not disclose any nonpublic personal information about our customers or
former customers without the customer's authorization, except as required by law
or in response to inquires from governmental authorities. We restrict access to
your personal and account information to those employees who need to know that
information to provide products and services to you. We also may disclose that
information to unaffiliated third parties (such as to brokers or custodians)
only as permitted by law and only as needed for us to provide agreed services to
you. We maintain physical, electronic and procedural safeguards to guard your
nonpublic personal information.
Item 2. Code of Ethics.
- -------------------------
The registrant has adopted a code of ethics that applies to the registrant's
principal executive officer and principal financial officer. The registrant has
not made any amendment to its code of ethics during the covered period. The
registrant has not granted any waivers from any provisions of the code of ethics
during the covered period. The registrant undertakes to provide to any person
without charge, upon request, a copy of its code of ethics by mail when they
call the registrant at 1-800-851-8845.
Item 3. Audit Committee Financial Expert.
- -------------------------------------------
The registrant's board of trustees has determined that it does not have an audit
committee financial expert serving on its audit committee. At this time, the
registrant believes that the experience provided by each member of the audit
committee together offer the registrant adequate oversight for the registrant's
level of financial complexity.
Item 4. Principal Accountant Fees and Services.
- -------------------------------------------------
Not required for annul reports filed for periods ending before December 15,
2003.
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. [Reserved]
- --------------------
Item 9. Controls and Procedures.
- ----------------------------------
(a) Based on their evaluation of the Registrant's Disclosure Controls and
Procedures as of a date within 90 days of the Filing Date, the Registrant's
President and Treasurer/CFO have determined that the Disclosure Controls
and Procedures (as defined in Rule 30a-2(c) under the Act) are designed to
ensure that information required to be disclosed by the Registrant is
recorded, processed, summarized and reported by the Filing Date, and that
information required to be disclosed in the report is communicated to the
Registrant's management, as appropriate, to allow timely decisions
regarding required disclosure.
2
(b) There were no significant changes in the Registrant's internal controls or
in other factors that could significantly affect these controls subsequent
to the date of their evaluation, and there were no corrective actions with
regard to significant deficiencies and material weaknesses.
Item 10: Exhibits.
- -------------------
(a) Code of Ethics. Filed herewith.
(b) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
Filed herewith.
(c) Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
Furnished herewith.
3
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.
THE PURISIMA FUNDS
By (Signature and Title) /s/ KENNETH L. FISHER
---------------------
Kenneth L. Fisher, President
Date 11/7/03
-------------------------------------
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title) /s/ KENNETH L. FISHER
---------------------
Kenneth L. Fisher, President
Date 11/7/03
-------------------------------------
By (Signature and Title) /s/ DAVID RUIZ
--------------
David Ruiz, Treasurer
Date 11/6/03
-------------------------------------
4