NOTE 1: Endowment and Similar Funds

The major portion of the University's endowment and similar funds is maintained in a single investment pool named the University Pooled Endowment Fund. The University has adopted an investment objective whereby the average annual return of the University Pooled Endowment Fund over rolling five-year periods should equal the rate of inæation (measured by the Consumer Price Index) plus its average level of spending from endowment income. The annual return for the Pooled Endowment Fund was 18.4 percent in 1999 and 14.3 percent in 1998. These percentages have been computed using realized and unrealized gains and losses and investment income. The rate of inæation plus the average level of spending from endowment income was 7.0 percent in 1999 and 6.4 percent in 1998.

The Pooled Endowment Fund is pooled using a market value basis, with each individual fund subscribing to or disposing of units (permanent shares) on the basis of the market value per unit at the beginning of the calendar month within which the transaction takes place. A summary of endowment and similar funds at market value follows:

Endowment and Similar Funds As of June 30, 1999 (in thousands)

Pooled Endowment Assets*

Separately Invested Assets

Total

Mutual and Money Market Funds

$ 321,726

$ 8,486

$ 330,212

Repurchase Agreements

--

--

--

U.S. Government Securities

149,814

2,992

152,806

Corporate and Municipal Bonds

47,601

2,539

50,140

Corporate Notes

438

--

438

International Bonds and Notes

--

--

--

Common and Preferred Stock

322,648

16,640

339,288

Advances to Foundations (Note 3c)

--

36,351

36,351

Real Estate and Other Tangible Property

--

1,280

1,280

Mortgages

4,198

--

4,198

Private Placement Investments

399,580

--

399,580

Total Assets
* Includes $24.6 million of trust assets.

$ 1,246,005

$ 68,288

$ 1,314,293

Investment Income

$ 24,902

$ 5,640

$ 30,542

Realized Net Gain

191,877

2,466

194,343

Unrealized Net Gain/(Loss)

(26,167)

378

(25,789)

Pooled Endowment Funds

Number of Permanent Shares

691,303

Number of Participating Shares

698,357

Market Value Per Share

$ 1,766.38

Earnings Per Share

$ 33.76

Distribution Per Share -- Class A

$ 64.95

Distribution Per Share -- Class B

$ 87.87

Endowment and Similar Funds As of June 30, 1998 (in thousands)

Pooled Endowment Assets*

Separately Invested Assets

Total

Mutual and Money Market Funds

$ 112,662

$ 9,892

$ 122,554

Repurchase Agreements

--

232,256

232,256

U.S. Government Securities

186,122

3,090

189,212

Corporate and Municipal Bonds

21,041

1,471

22,512

Corporate Notes

4,031

15,690

19,721

International Bonds and Notes

16,965

--

16,965

Common and Preferred Stock

441,268

15,117

456,385

Advances to Foundations (Note 3c)

--

45,596

45,596

Real Estate and Other Tangible Property

--

1,280

1,280

Mortgages

5,721

--

5,721

Private Placement Investments

286,198

--

286,198

Total Assets
* Includes $19.1 million of trust assets.

$ 1,074,008

$ 324,392

$ 1,398,400

Investment Income

$ 24,703

$ 5,424

$ 30,127

Realized Net Gain

102,628

1,532

104,160

Unrealized Net Gain/(Loss)

2,448

1,446

3,894

Pooled Endowment Funds

Number of Permanent Shares

690,142

Number of Participating Shares

691,217

Market Value Per Share

$ 1,528.24

Earnings Per Share

$ 36.85

Distribution Per Share -- Class A

$ 53.94

Distribution Per Share -- Class B

$ 73.99


Notes

Note 1

Note 2

Note 3

Note 4

Note 5

Note 6

Notes 7 - 14