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 811-08718
IPS Funds
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in charter)
1225 Weisgarber Road, Suite S-380, Knoxville, TN 37909
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(Address of principal executive offices) (Zip code)
CITCO Mutual Fund Services, Inc.
83 General Warren Boulevard, Suite 200
Malvern, PA 19355
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(Name and address of agent for service)
Registrant's telephone number, including area code: 800-232-9142
Date of fiscal year end: 11/30/2004
Date of reporting period: 5/31/2004
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1.
IPS iFUND 2004 SEMI ANNUAL REPORT
Fellow Portfolio Managers:
Congratulations! As portfolio managers to the iFund you have
contributed to the fund outperforming the S&P 500 for the one year period ending
May 31, 2004. However we are slightly behind the S&P 500 for the six months
ending May 31, 2004. What's most impressive is that we have generated these
returns while continuing to lower our risk.
There has been a lot of trade activity in the Fund the past six months,
but not much happening on the message boards. It appears most of you are
choosing to vote for buys and sells, but not posting messages. While it is not
required to post message it will help in the decision making, so we encourage
all of you to try and get involved. The more sharing of information and ideas
the better our decisions will be regarding the management of the portfolio. As
the Fund continues to generate new interest, the level of excitement and
participation will continue to grow.
FIGURE 1: Past performance is no guarantee of future results. Share price and
investment return will vary so that, when redeemed, an investor's shares may be
worth more, or less, than their original cost.
[TABLE BELOW REPRESENTS A BAR GRAPH IN THE ORIGINAL REPORT.]
IPS iFUND ANNUALIZED RETURNS
MAY 31, 2004
INCEPTION
6 MONTHS 1 YEAR 3 YEAR (12/29/00)
-------- ------ ------ ----------
iFUND 1.20% 29.28% -11.06 -15.69%
S&P 500 INDEX 1.60% 18.33% -2.12 -2.84%
FIGURE 1: Past performance is no guarantee of future results. Share price and
investment return will vary so that, when redeemed, an investor's shares may be
worth more, or less, than their original cost.
AVERAGE ANNUAL RETURNS AS OF 5/31/04
INCEPTION
6 MONTHS 1 YEAR 3 YEAR (12/29/00)
-------- ------ ------ ----------
iFUND 1.20% 29.28% -11.06 -15.69%
S&P 500 INDEX 1.60% 18.33% -2.12 -2.84%
- --------------------------------------------------------------------------------
VOLATILITY OF RETURNS
As you can see in figure 2 the iFund's risk continues to decline, but
it is still higher than both the S&P 500 and Value Line Index. The Fund's
volatility, as measured as the Standard Deviation of the most recent 13 monthly
returns, has dropped from 4.98% on November 30, 2003 to 3.32%. This is a nice
decline and with the amount of assets we have in cash at the present time we
would expect the risk to continue to decrease. With the market continuing to
fall the higher cash position has helped protect the fund from declining as much
as the S&P 500 over the past couple months.
IPS iFUND VOLATILITY VS. BROAD STOCK MARKET
June 30, 2004
[PLOT POINTS IN LINE CHART TO COME]
FIGURE 2: Volatility of the Fund on a monthly basis, versus the broad stock
market as represented by the VALUE LINE ARITHMETIC COMPOSITE INDEX, a broad
based, equally weighted index of approximately 1,700 stocks with dividends
reinvested. Risk is measured as the Standard Deviation of the most recent 13
monthly returns.
PORTFOLIO CHANGES
The portfolio has changed a lot over the past six months. We did a lot
of selling, but not much buying and as a result our cash position has more than
double to over 35%. There was an average of 5 1/2 transactions each month, with
December and May being the most active. The health care sector underwent the
most change going from 23.4% of assets at the end of November to just 11.83%.
There were also some changes in the financials sector going from just 1.21% in
November to over 6.8% at the end of May. We sold all of our CHINA FUND (CHN) for
an approximate 100% gain, and we bought AFLAC (AFL) and AMERICAN INTERNATIONAL
GROUP (AIG). The industrials sector was also altered a great deal. We sold
stocks such as KAYDON CORPORATION (KDN), which sold for a 24% gain, and ANGELICA
(AGL), which sold for a 29% gain, and added COINSTAR INC. (CSTR) and WOODWARD
GOVERNOR (WGOV). Both have both already gone up almost 10%. As of May 31 or top
ten stocks represent 33.6% of the portfolio.
- --------------------------------------------------------------------------------
We encourage you to participate and share you thoughts and ideas on
what you see happening in the world around you. It is this sharing that will
allow us all to make better investment decisions. Once again we would like to
thank you for your contributions to the iFund. With your support the fund will
continue to grow and along with that will come a higher level of community
intelligence.
Greg D'Amico Robert Loest, Pd.D., CFA
President Advisor
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THE IPS iFUND
SCHEDULE OF INVESTMENTS
MAY 31, 2004 (UNAUDITED)
COMMON STOCKS - 64.27% MARKET
SHARES VALUE
-------- --------
CONSUMER DISCRETIONARY - 13.22%
Cadbury Schweppes Plc ADR - United Kingdom 125 $ 4,313
CBRL Group, Inc. 60 1,935
Lancaster Colony Corp. 40 1,601
Regal Entertainment Group 105 2,247
--------
10,096
--------
ENERGY - 2.79%
Suncor Energy, Inc. 90 2,129
--------
FINANCIALS - 6.80%
AFLAC, Inc. 45 1,827
American International Group, Inc. 46 3,372
--------
5,199
--------
HEALTH CARE - 11.83%
Amgen, Inc. * 13 711
Kindred Healthcare, Inc.* 92 2,285
Kyphon, Inc.* 60 1,469
Serona SA ADR - Switzerland 110 1,653
Sunrise Assisted Living, Inc* 50 1,802
Wellpoint Health Networks, Inc.* 10 1,115
--------
9,035
--------
INDUSTRIALS - 6.95%
Bandag, Inc. 45 1,907
Coinstar, Inc.* 100 1,740
Woodward Governor Co. 25 1,661
--------
5,308
--------
INFORMATION TECHNOLOGY - 13.80%
Apple Computer, Inc.* 24 674
Dell Computer Corp.* 45 1,583
Electronic Arts, Inc.* 45 2,287
ProQuest Co.* 35 913
Storage Technology Corp.* 80 2,260
Volt Information Sciences, Inc.* 110 2,827
--------
10,544
--------
MATERIALS - 2.69%
Goldcorp, Inc. 170 2,059
--------
TELECOM SERVICES - 4.10%
Inet Technologies, Inc.* 40 356
Optical Cable Corp.* 340 1,829
Vodafone Group Plc ADR - United Kingdom 40 950
--------
3,135
--------
UTILITIES - 2.09%
FPL Group, Inc. 25 1,594
--------
TOTAL COMMON STOCK (COST $44,379) 49,099
--------
The accompanying notes are an integral part of these financial statements.
THE IPS iFUND
SCHEDULE OF INVESTMENTS
MAY 31, 2004 (UNAUDITED)
MARKET
PRINCIPAL VALUE
--------- --------
SHORT-TERM INVESTMENT - 27.98%
Federated Cash Trust Series II, Rate 0.15%(a) 21,375 $ 21,375
--------
TOTAL SHORT-TERM INVESTMENTS (COST $21,375) 21,375
--------
TOTAL INVESTMENTS (COST $65,754) - 92.25% 70,474
OTHER ASSETS LESS LIABILITIES, NET - 7.75% 5,917
--------
NET ASSETS - 100.00% $ 76,391
========
ADR - American Depository Receipts
(a) Variable rate security, the coupon rate shown represents the rate at May
31, 2004
* Non-income producing security
The accompanying notes are an integral part of these financial statements.
THE IPS iFUND
STATEMENT OF ASSETS AND LIABILITIES MAY 31,
2004 (UNAUDITED)
ASSETS:
Investments, at value (cost $65,754) $ 70,474
Receivable for investments sold 9,244
Dividends receivable 112
Interest receivable 3
---------
Total Assets 79,833
---------
LIABILITIES:
Payable for investments purchased 3,353
Payable to Advisor 89
---------
Total Liabilities 3,442
---------
$ 76,391
=========
NET ASSETS CONSIST OF:
Capital stock $ 114,377
Accumulated net realized loss on investments sold (42,483)
Accumulated undistributed net investment loss (223)
Net unrealized appreciation on investments 4,720
---------
Total Net Assets $ 76,391
=========
Shares outstanding (no par value, unlimited shares authorized) 11,387
Net asset value, redemption price and offering price per share $ 6.71
=========
The accompanying notes are an integral part of these financial statements.
THE IPS iFUND
STATEMENT OF OPERATIONS
FOR THE PERIOD ENDED MAY 31, 2004 (UNAUDITED)
INVESTMENT INCOME:
Dividend and interest income $ 333
--------
Total investment income 333
--------
EXPENSES:
Investment advisory fee 556
--------
Total expenses 556
--------
NET INVESTMENT LOSS (223)
--------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investment transactions 15,141
Change in unrealized appreciation (depreciation) on
investments (12,241)
--------
Net realized and unrealized gain on investments 2,900
--------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $ 2,677
========
The accompanying notes are an integral part of these financial statements.
THE IPS iFUND
STATEMENTS OF CHANGES IN NET ASSETS
SIX-MONTH
PERIOD ENDED
MAY 31, 2004 YEAR ENDED
(UNAUDITED) NOVEMBER 30, 2003
------------ -----------------
OPERATIONS:
Net investment loss $ (223) $ (452)
Net realized gain on investment transactions 15,141 8,113
Change in unrealized appreciation on investments (12,241) 12,740
-------- --------
Net increase in net assets resulting from operations 2,677 20,401
-------- --------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold 1,500 9,602
Cost of shares redeemed (8,968) (25,518)
-------- --------
Net decrease in net assets resulting from capital
share transactions (7,468) (15,916)
-------- --------
TOTAL INCREASE (DECREASE) IN NET ASSETS (4,791) 4,485
NET ASSETS:
Beginning of period 81,182 76,697
-------- --------
End of period (Including accumulated undistributed
net invesment income of $0, and $0 respectively) $ 76,391 $ 81,182
======== ========
The accompanying notes are an integral part of these financial statements.
IPS iFUND
FINANCIAL HIGHLIGHTS
Selected per share data is based on a share of common stock outstanding
throughout each period.
------------------ ----------------- ----------------- --------------------
SIX-MONTH PERIOD DECEMBER 29, 2000(1)
ENDED MAY 31, 2004 YEAR ENDED YEAR ENDED THROUGH
(UNAUDITED) NOVEMBER 30, 2003 NOVEMBER 30, 2002 NOVEMBER 30, 2001
------------------ ----------------- ----------------- --------------------
PER SHARE DATA:
Net asset value, beginning of period $ 6.50 $ 5.04 $ 7.09 $ 12.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (0.02) (0.03) (0.05) (0.02)(2)
Net realized and unrealized
gain (loss) on investments 0.23 1.49 (2.00) (4.89)
------- ------- ------- -------
TOTAL FROM INVESTMENT OPERATIONS 0.21 1.46 (2.05) (4.91)
------- ------- ------- -------
Net asset value, end of period $ 6.71 $ 6.50 $ 5.04 $ 7.09
======= ======= ======= =======
Total return 3.23%(3) 28.97% (28.91)% (40.92)%(3)
SUPPLEMENTAL DATA AND RATIOS:
Net assets, end of period (000's) $ 76 $ 81 $ 77 $ 95
Ratio of net operating expenses to average net assets 1.40%(4) 1.40% 1.40% 1.40%(4)
Ratio of net investment income to average net assets (0.56)%(4) (0.58)% (0.83)% (0.49)%(4)
Portfolio turnover rate 38.63% 150.57% 177.50% 124.68%
(1) Commencement of operations
(2) Net investment income per share is calculated using ending balances prior
to consideration of adjustments for permanent book and tax differences.
(3) Not annualized
(4) Annualized
The accompanying notes are an integral part of these financial statements.
IPS iFUND
NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 2004
(UNAUDITED)
1. ORGANIZATION
The IPS iFund (the "Fund") is a series of the IPS Funds (the "Trust"), an
Ohio business trust organized on August 10, 1994, and is registered under
the Investment Company Act of 1940, as amended (the "1940 Act"). The
principal investment objective of the Fund is long-term capital growth. The
Fund is non-diversified and therefore can invest a greater percentage of
its assets in fewer securities than a diversified fund. To the extent the
Fund invests its assets in fewer securities, the Fund is subject to greater
risk of loss if those securities decline in value. Nonetheless, the Fund
intends to qualify as a registered investment company for income tax
purposes, which means the Fund intends to fulfill the Internal Revenue Code
diversification requirements applicable to registered investment companies.
The Fund commenced operations on December 29, 2000.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. These
policies are in conformity with accounting principles generally accepted in
the United States of America ("GAAP"). The presentation of financial
statements in conformity with GAAP requires management to make estimates
and assumptions that affect the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates and assumptions.
(a) Investment Valuation
Securities which are traded on a recognized stock exchange are valued
at the last sale price on the securities exchange on which such
securities are primarily traded. Securities traded on the
over-the-counter market and listed securities for which there were no
transactions are valued at the last quoted bid price. Debt instruments
maturing within 60 days are valued by the amortized cost method. Any
securities for which market quotations are not readily available are
valued at their fair value as determined in good faith by IPS Advisory,
Inc. (the "Advisor") pursuant to guidelines established by the Board of
Directors.
(b) Federal Income and Excise Taxes
The Fund intends to meet the requirements of the Internal Revenue Code
applicable to regulated investment companies and to distribute
substantially all net investment company taxable income and net capital
gains to shareholders in a manner which results in no tax cost to the
Fund. Therefore, no federal income or excise tax provision is required.
(c) Distributions to Shareholders
Dividends from net investment income are declared and paid annually.
Distributions of net realized capital gains, if any, will be declared
and paid at least annually. Distributions to shareholders are recorded
on the ex-dividend date. The Fund may periodically make
reclassifications among certain of its capital accounts as a result of
the recognition and characterization of certain income and capital gain
distributions determined annually in accordance with federal tax
regulations which may differ from GAAP.
(d) Securities Transactions and Investment Income
Investment transactions are recorded on the trade date for financial
statement purposes. The Fund determines the gain or loss realized from
the investment transactions by comparing the original cost of the
security lot sold with the net sale proceeds. Dividend income is
recognized on the ex-dividend date and interest income is recognized on
an accrual basis. Acquisition and market discounts are amortized over
the life of the security.
(e) Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities,
disclosure of contingent assets and liabilities at the date of the
financial statements; and the reported amounts of revenues and expenses
during the reported period. Actual results could differ from those
estimates.
IPS iFUND
NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 2004
(UNAUDITED)
3. SHARES OF COMMON STOCK
Transactions in shares of common stock were as follows:
SIX-MONTH
PERIOD ENDED
MAY 31, 2004 YEAR ENDED
(UNAUDITED) NOVEMBER 30, 2003
----------------------- -----------------------
IPS iFUND $ Shares $ Shares
-------- -------- -------- --------
Shares sold $ 1,500 226 $ 9,602 1,642
Shares issued in reinvestment
of dividends -- -- -- --
Shares redeemed (8,968) (1,324) (25,518) (4,382)
-------- -------- -------- --------
Net increase (decrease) ($ 7,468) (1,098) ($15,916) (2,740)
======== ======== ======== ========
SHARES OUTSTANDING:
Beginning of period 12,485 15,225
-------- --------
End of period 11.387 12,485
======== ========
4. INVESTMENT TRANSACTIONS
Purchases and sales of securities for the six-month period ended May 31,
2004, excluding short-term investments, aggregated $23,850 and $46,674,
respectively. There were no purchases or sales of long-term U.S. government
securities.
At May 31, 2004, gross unrealized appreciation and depreciation of
investments, based on cost for federal income tax purposes of $65,754 were
as follows:
Unrealized appreciation $ 6,224
Unrealized depreciation (1,504)
-------
Net unrealized appreciation on
investments $ 4,720
=======
The fund's tax-basis capital gains and losses are determined only at the
end of the fiscal year. At November 30, 2003, the Fund had an accumulated
net realized capital loss carryover of $57,624, with $23,202 expiring in
2009 and $34,422 expiring in 2010. To the extent the Fund realizes future
net capital gains, taxable distributions to its shareholders will be offset
by any unused capital loss carryover.
5. INVESTMENT ADVISOR
The Fund has an agreement with IPS Advisory, Inc. (the "Advisor"), with
whom certain officers and directors of the Fund are affiliated, to furnish
investment advisory services to the Fund. Under the terms of the agreement,
the Advisor will pay all of the Fund's operating expenses, excluding
brokerage fees and commissions, taxes, interest and extraordinary expenses.
The Fund is obligated to pay the Advisor a fee computed and accrued daily
and paid monthly at an annual rate of 1.40% of its average daily net assets
to and including $50,000,000 and 0.95% of such assets in excess of
$50,000,001. Total fees earned by IPS Advisory, Inc. during the six-month
period ended May 31, 2004 were $556.
IPS iFUND
NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 2004
(UNAUDITED)
6. BENEFICIAL OWNERSHIP
The beneficial ownership, either directly or indirectly, of more than 25%
of the voting securities of a fund creates a presumption of control of the
fund, under Section 2(a)(9) of the Investment Company Act of 1940. As of
May 31, 2004, Gregory A. D'Amico beneficially owned 32% of the Fund.
7. DISTRIBUTABLE EARNINGS
There were no distributions during the fiscal years 2004 and 2003.
As of May 31, 2004, the components of distributable earnings (accumulated
losses) on a tax basis were as follows:
iFund
---------
Undistributed ordinary income
(accumulated losses) $ (223)
Undistributed long-term capital gain
(accumulated losses) (42,483)
Unrealized appreciation/(depreciation) 4,720
---------
$ (37,986)
=========
8. CHANGES IN CERTIFYING ACCOUNTANT
On January 20, 2004, McCurdy & Associates CPA's, Inc. ("McCurdy") notified the
Funds of its intention to resign as the Funds' independent auditors upon
selection of replacement auditors.
On January 23, 2004, the Funds' Audit Committee and Board of Directors selected
Cohen McCurdy, Ltd. ("Cohen") to replace McCurdy as the Funds' auditors for the
fiscal year ending November 30, 2004, to be effective upon the resignation of
McCurdy.
On March 12, 2004, upon receipt of notice that Cohen was selected as the Funds'
auditor, McCurdy, whose audit practice was acquired by Cohen, resigned as
independent auditors to the Fund. McCurdy's reports on the IPS financial
statements for the fiscal year ended November 30, 2003 contained no adverse
opinion or disclaimer of opinion nor were they qualified or modified as to
uncertainty, audit scope or accounting principles. During the fiscal years
stated above, there were no disagreements with McCurdy on any matter of
accounting principles or practices, financial statement disclosure or auditing
scope or procedure which, if not resolved to the satisfaction of McCurdy would
have caused the Advisor to make reference to the subject matter of the
disagreements in connection with its reports on the Funds' financial statements
for such periods.
Neither the Funds nor anyone on its behalf consulted with Cohen on items which
(i) concerned the application of accounting principles to a specified
transaction, either completed or proposed, or the type of audit opinion that
might be rendered on the Funds' financial statements or (ii) concerned the
subject of a disagreement (as defined in paragraph (a)(1)(iv) of Item 304 of
Regulation S-K) or a reportable event (as described in paragraph (a)(1)(v) of
said Item 304).
IPS iFUND
NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 2004
(UNAUDITED)
- ----------------------------------------------------------------------------------------------------------------------------
TERM OF # OF
OFFICE PORTFOLIOS
AND IN FUND OTHER
POSITION(S) LENGTH OF COMPLEX DIRECTORSHIPS
HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN HELD BY
NAME, ADDRESS AND AGE THE TRUST SERVED DURING PAST FIVE YEARS BY TRUSTEE TRUSTEE
- ----------------------------------------------------------------------------------------------------------------------------
Veenita Bisaria, 44, Independent Since Financial Analyst, Tennessee 3 None
12416 Fort West Drive Trustee inception Valley Authority (1997-
Knoxville, TN 37922 of Funds Present); Director of Business
in 1995 Planning at Lockheed Martin
Energy Systems (Prior to
1997); Chartered Financial
Analyst (CFA).
- ----------------------------------------------------------------------------------------------------------------------------
Woodrow Henderson, 47, Independent Since Director of Planned Giving for 3 None
6504 Clary Lane Trustee inception the University of Tennessee at
Knoxville, TN 37919 of Funds Knoxville.
in 1995
- ----------------------------------------------------------------------------------------------------------------------------
Billy Wayne Stegall, Jr., 47, Independent Since Account Executive, Colonial 3 None
316 Stonewall Street Trustee inception Life & Accident (1995-
Memphis, TN 38112 of Funds Present); Teacher of history
in 1995 and economics at Austin East
High School in Knoxville,
Tennessee (Prior to 1995).
- ----------------------------------------------------------------------------------------------------------------------------
INDEPENDENT TRUSTEES (UNAUDITED)
INTERESTED TRUSTEES & OFFICERS (UNAUDITED)
IPS iFUND
NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 2004 (UNAUDITED)
- ---------------------------------------------------------------------------------------------------------------------------------
TERM OF # OF
OFFICE PORTFOLIOS
AND IN FUND OTHER
POSITION(S) LENGTH OF COMPLEX DIRECTORSHIPS
HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN HELD BY
NAME, ADDRESS AND AGE THE TRUST SERVED DURING PAST FIVE YEARS BY TRUSTEE TRUSTEE
- ---------------------------------------------------------------------------------------------------------------------------------
Greg D'Amico*, 40, President, Since President of IPS 3 IPS Advisory, Inc.; Director
1225 Weisgarber Road, Chief inception Advisory, Inc. of Young Entrepreneurs'
Suite S-380, Financial of Funds in Organization (YEO);
Knoxville, TN 37909 Officer, 1995 Personal & Child Safety,
Treasurer LLC (PCS)
and Trustee
- ---------------------------------------------------------------------------------------------------------------------------------
Robert Loest*, 60, Vice Since Chief Executive 3 IPS Advisory, Inc.
1225 Weisgarber Road, President, inception Officer of IPS
Suite S-380, Secretary of Funds in Advisory, Inc.;
Knoxville, TN 37909 and Trustee 1995 Financial Analyst
Charter; Ph.D. in
Biology.
- ---------------------------------------------------------------------------------------------------------------------------------
* An "interested person" of the Trust, as defined in the Investment Company Act
of 1940, due to his relationship with the Advisor.
BOARD COMMITTEES
The Board has the following standing committee as described below:
- --------------------------------------------------------------------------------
AUDIT COMMITTEE
- --------------------------------------------------------------------------------
MEMBERS DESCRIPTION MEETINGS
- ------- ----------- --------
Veenita Bisaria, Responsible for advising the At least once
- ---------------- full Board with respect to annually. Last
Independent Trustee accounting, auditing and meeting occurred
Woodrow Henderson, financial matters affecting on January 25,
Independent Trustee the Trust. 2002.
Billy Wayne Stegall, Jr.,
Independent Trustee
ITEM 2. CODE OF ETHICS.
Not applicable at this time.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable at this time.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable at this time.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. SCHEDULE OF INVESTMENTS
Included in Semi-Annual Report to Shareholders filed under Item 1 of this form.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PURCHASE OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable.
ITEM 10. CONTROLS AND PROCEDURES
Based on their evaluation of registrant's disclosure controls and procedures (as
defined in Rule 30a-3(c) under the 1940 Act (17 CFR 270.30a-3(c)) as of June 30,
2004 registrant's principal executive officer and principal financial officer
found registrant's disclosure controls and procedures to be appropriately
designed to ensure that information required to be disclosed by registrant in
the reports that it files under the Securities Exchange Act of 1934 (i) is
accumulated and communicated to registrant's management, including its principal
executive officer and principal financial officer, to allow timely decisions
regarding required disclosure, and (ii) is recorded, processed, summarized and
reported, within the time periods specified in the rules and forms adopted by
the U.S. Securities and Exchange Commission.
-4-
There has been no change in registrant's internal control that occurred during
the reporting period that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial reporting.
ITEM 11. EXHIBITS.
(a) File the exhibits below as part of this form
Exhibit 99.Cert Certification Pursuant to Section 302 of the
Sarbanes-Oxley Act
Exhibit 99.906Cert Certification Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
SIGNATURES
[See General Instruction F]
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.
IPS Funds
(Registrant)
By: /s/ Greg D'Amico
-----------------------
Greg D'Amico
President
By: /s/ Robert Loest
-----------------------
Robert Loest
Treasurer
Date 08/09/2004
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/ Greg D'Amico
-----------------------
Greg D'Amico
President
By: /s/ Robert Loest
-----------------------
Robert Loest
Treasurer
Date 08/09/2004
-5-