JACOB FUNDS INC.
JACOB MICRO CAP GROWTH FUND
The table below sets forth financial data for a share of the Fund outstanding throughout each period presented.
|
|
|
Nine Months
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ended
|
|
|
Year Ended November 30,
|
|
|
|
|
August 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2013*
|
|
|
|
2012
(1)
|
|
|
|
2011
(1)
|
|
|
|
2010
(1)
|
|
|
|
2009
(1)
|
|
|
|
2008
(1)
|
|
|
Institutional Class
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Per Share Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net asset value, beginning of period
|
|
$
|
19.11
|
|
|
$
|
18.19
|
|
|
$
|
17.82
|
|
|
$
|
13.18
|
|
|
$
|
10.42
|
|
|
$
|
24.88
|
|
|
Income (loss) from investment operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment loss
(4)
|
|
|
(0.27
|
)
|
|
|
(0.31
|
)
|
|
|
(0.30
|
)
|
|
|
(0.20
|
)
|
|
|
(0.15
|
)
|
|
|
(0.10
|
)
|
|
Net realized and unrealized gain (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
on investment transactions
|
|
|
6.47
|
|
|
|
1.23
|
|
|
|
0.67
|
|
|
|
4.84
|
|
|
|
2.91
|
|
|
|
(10.40
|
)
|
|
Total from investment operations
|
|
|
6.20
|
|
|
|
0.92
|
|
|
|
0.37
|
|
|
|
4.64
|
|
|
|
2.76
|
|
|
|
(10.50
|
)
|
|
Less distributions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
From net realized gain
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(3.96
|
)
|
|
Net asset value, end of period
|
|
$
|
25.31
|
|
|
$
|
19.11
|
|
|
$
|
18.19
|
|
|
$
|
17.82
|
|
|
$
|
13.18
|
|
|
$
|
10.42
|
|
|
Total return
|
|
|
32.44
|
%
(6)
|
|
|
5.06
|
%
|
|
|
2.08
|
%
|
|
|
35.20
|
%
|
|
|
26.49
|
%
|
|
|
(50.02
|
)%
|
|
Supplemental data and ratios:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net assets, end of period (in thousands)
|
|
$
|
10,800
|
|
|
$
|
40,666
|
|
|
$
|
50,065
|
|
|
$
|
51,300
|
|
|
$
|
40,122
|
|
|
$
|
41,582
|
|
|
Ratio of gross operating expenses (prior to waiver
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
or reimbursements) to average net assets
|
|
|
3.01
|
%
(7)
|
|
|
2.12
|
%
|
|
|
1.79
|
%
|
|
|
1.89
|
%
|
|
|
2.00
|
%
|
|
|
1.73
|
%
|
|
Ratio of net operating expenses (after waiver
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
or reimbursements) to average net assets
|
|
|
2.28
|
%
(2)(7)
|
|
|
1.72
|
%
(2)(3)
|
|
|
1.60
|
%
(3)
|
|
|
1.60
|
%
(3)
|
|
|
1.60
|
%
(3)
|
|
|
1.60
|
%
(3)
|
|
Ratio of net investment loss (prior to waiver
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
or reimbursements) to average net assets
|
|
|
(2.46
|
)%
(7)
|
|
|
(1.95
|
)%
|
|
|
(1.72
|
)%
(5)
|
|
|
(1.64
|
)%
(5)
|
|
|
(1.76
|
)%
(5)
|
|
|
(0.71
|
)%
(5)
|
|
Ratio of net investment loss (after waiver
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
or reimbursements) to average net assets
|
|
|
(1.73
|
)%
(2)(7)
|
|
|
(1.55
|
)%
(2)(3)
|
|
|
(1.53
|
)%
(3)
|
|
|
(1.35
|
)%
(3)
|
|
|
(1.36
|
)%
(3)
|
|
|
(0.58
|
)%
(3)
|
|
Portfolio turnover rate
|
|
|
40.19
|
%
(6)
|
|
|
115
|
%
|
|
|
165
|
%
|
|
|
216
|
%
|
|
|
209
|
%
|
|
|
250
|
%
|
_______________
(1) The financial highlights set forth herein include the historical financial highlights of the Jacob Micro Cap Growth Fund (formerly, PineBridge US Micro Cap Growth Fund) series of Jacob Funds II (formerly, PineBridge Mutual Funds) (the “Predecessor Fund”). The Predecessor Fund was reorganized into the Micro Cap Growth Fund on November 12, 2012. On July 9, 2012, before the reorganization, the adviser changed from PineBridge Investments, LLC to Jacob Asset Management of New York LLC (the “Adviser”). Information prior to November 12, 2012 reflects the performance of the Predecessor Fund’s Class I shares. See Note 9.
(2 The Adviser has contractually agreed, effective November 12, 2012 (date of reorganization) through January 2, 2014, to waive up to 100% of its advisory fee to the extent that the Fund’s operating expense ratio exceeds 2.15%, excluding any taxes, interest, brokerage fees, acquired fund fees and expenses, and extraordinary expenses.
(3) Prior to November 12, 2012, the previous adviser and the Adviser agreed to waive operating expenses over 1.60% of the Fund’s average daily net assets.
(4) Net investment loss per share represents net investment loss divided by the average shares outstanding throughout the period.
(5) Unaudited.
(6 Not annualized.
(7) Annualized.
* The Micro Cap Growth Fund’s predecessor fund had a fiscal year end of November 30, so the current activity begins on December 1, 2012 and the numbers shown are for the nine month period. The fiscal year was changed to August 31 to align with the other Jacob Funds.
The accompanying notes are an integral part of these financial statements.
JACOB FUNDS INC.
JACOB MICRO CAP GROWTH FUND
The table below sets forth financial data for a share of the Fund outstanding throughout each period presented.
|
|
|
Nine Months
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ended
|
|
|
Year Ended November 30,
|
|
|
|
August 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2013*
|
|
|
|
2012
(1)
|
|
|
|
2011
(1)
|
|
|
|
2010
(1)
|
|
|
|
2009
(1)
|
|
|
|
2008
(1)
|
|
|
Investor Class
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Per Share Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net asset value, beginning of period
|
|
$
|
18.51
|
|
|
$
|
17.68
|
|
|
$
|
17.36
|
|
|
$
|
12.88
|
|
|
$
|
10.21
|
|
|
$
|
24.51
|
|
|
Income (loss) from investment operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment loss
(4)
|
|
|
(0.37
|
)
|
|
|
(0.37
|
)
|
|
|
(0.35
|
)
|
|
|
(0.25
|
)
|
|
|
(0.18
|
)
|
|
|
(0.14
|
)
|
|
Net realized and unrealized gain (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
on investment transactions
|
|
|
6.33
|
|
|
|
1.20
|
|
|
|
0.67
|
|
|
|
4.73
|
|
|
|
2.85
|
|
|
|
(10.20
|
)
|
|
Total from investment operations
|
|
|
5.96
|
|
|
|
0.83
|
|
|
|
0.32
|
|
|
|
4.48
|
|
|
|
2.67
|
|
|
|
(10.34
|
)
|
|
Less distributions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
From net realized gain
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(3.96
|
)
|
|
Net asset value, end of period
|
|
$
|
24.47
|
|
|
$
|
18.51
|
|
|
$
|
17.68
|
|
|
$
|
17.36
|
|
|
$
|
12.88
|
|
|
$
|
10.21
|
|
|
Total return
|
|
|
32.20
|
%
(6)
|
|
|
4.69
|
%
|
|
|
1.84
|
%
|
|
|
34.78
|
%
|
|
|
26.15
|
%
|
|
|
(50.14
|
)%
|
|
Supplemental data and ratios:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net assets, end of period (in thousands)
|
|
$
|
3,573
|
|
|
$
|
4,356
|
|
|
$
|
9,339
|
|
|
$
|
9,282
|
|
|
$
|
4,198
|
|
|
$
|
4,458
|
|
|
Ratio of gross operating expenses (prior to waiver
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
or reimbursements) to average net assets
|
|
|
3.65
|
%
(7)
|
|
|
2.47
|
%
|
|
|
2.12
|
%
|
|
|
2.24
|
%
|
|
|
2.35
|
%
|
|
|
2.03
|
%
|
|
Ratio of net operating expenses (after waiver
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
or reimbursements) to average net assets
|
|
|
2.63
|
%
(2)(7)
|
|
|
2.07
|
%
(2)(3)
|
|
|
1.88
|
%
(3)
|
|
|
1.90
|
%
(3)
|
|
|
1.90
|
%
(3)
|
|
|
1.85
|
%
(3)
|
|
Ratio of net investment loss (prior to waiver
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
or reimbursements) to average net assets
|
|
|
(3.34
|
)%
(7)
|
|
|
(2.30
|
)%
|
|
|
(2.05
|
)%
(5)
|
|
|
(2.01
|
)%
(5)
|
|
|
(2.11
|
)%
(5)
|
|
|
(1.00
|
)%
(5)
|
|
Ratio of net investment loss (after waiver
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
or reimbursements) to average net assets
|
|
|
(2.32
|
)%
(2)(7)
|
|
|
(1.90
|
)%
(2)(3)
|
|
|
(1.81
|
)%
(3)
|
|
|
(1.67
|
)%
(3)
|
|
|
(1.66
|
)%
(3)
|
|
|
(0.82
|
)%
(3)
|
|
Portfolio turnover rate
|
|
|
40.19
|
%
(6)
|
|
|
115
|
%
|
|
|
165
|
%
|
|
|
216
|
%
|
|
|
209
|
%
|
|
|
250
|
%
|
|
_______________
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) The financial highlights set forth herein include the historical financial highlights of the Jacob Micro Cap Growth Fund (formerly, PineBridge US Micro Cap Growth Fund) series of Jacob Funds II (formerly, PineBridge Mutual Funds) (the “Predecessor Fund”). The Predecessor Fund was reorganized into the Micro Cap Growth Fund on November 12, 2012. On July 9, 2012, before the reorganization, the adviser changed from PineBridge Investments, LLC to Jacob Asset Management of New York LLC (the “Adviser”). Information prior to November 12, 2012 reflects the performance of the Predecessor Fund’s Class R shares. See Note 9.
(2) The Adviser has contractually agreed, effective November 12, 2012 (date of reorganization) through January 2, 2014, to waive up to 100% of its advisory fee to the extent that the Fund’s operating expense ratio exceeds 2.45%, excluding any taxes, interest, brokerage fees, acquired fund fees and expenses, and extraordinary expenses.
(3) Prior to November 12, 2012, the previous adviser and the Adviser agreed to waive operating expenses over 1.90% of the Fund’s average daily net assets.
(4) Net investment loss per share represents net investment loss divided by the average shares outstanding throughout the period.
(5) Unaudited.
(6) Not annualized.
(7) Annualized.
* The Micro Cap Growth Fund’s predecessor fund had a fiscal year end of November 30, so the current activity begins on December 1, 2012 and the numbers shown are for the nine month period. The fiscal year was changed to August 31 to align with the other Jacob Funds.
The accompanying notes are an integral part of these financial statements.
JACOB FUNDS INC.
JACOB WISDOM FUND
The table below sets forth financial data for a share of the Fund outstanding throughout each period presented.
|
|
|
|
|
|
|
|
|
|
|
|
June 1, 2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Through
|
|
|
Year Ended
|
|
|
|
|
Year Ended August 31,
|
|
|
August 31,
|
|
|
May 31,
|
|
|
|
|
2013
|
|
|
2012
|
|
|
2011
|
|
|
2010
(1)
|
|
|
2010
(2)
|
|
|
2009
|
|
|
Per Share Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net asset value, beginning of period
|
|
$
|
9.96
|
|
|
$
|
8.81
|
|
|
$
|
7.65
|
|
|
$
|
7.65
|
|
|
$
|
6.48
|
|
|
$
|
10.34
|
|
|
Income (loss) from investment operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income (loss)
|
|
|
0.20
|
|
|
|
0.16
|
|
|
|
0.08
|
|
|
|
0.02
|
|
|
|
0.00
|
|
|
|
(0.02
|
)
|
|
Net realized and unrealized gain (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
on investment transactions
|
|
|
0.62
|
|
|
|
1.08
|
|
|
|
1.10
|
|
|
|
(0.02
|
)
|
|
|
1.18
|
|
|
|
(3.23
|
)
|
|
Total from investment operations
|
|
|
0.82
|
|
|
|
1.24
|
|
|
|
1.18
|
|
|
|
0.00
|
|
|
|
1.18
|
|
|
|
(3.25
|
)
|
|
Less distributions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
From net investment income
|
|
|
(0.16
|
)
|
|
|
(0.09
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
From net realized gain
|
|
|
—
|
|
|
|
—
|
|
|
|
(0.02
|
)
|
|
|
—
|
|
|
|
(0.01
|
)
|
|
|
(0.61
|
)
|
|
Total distributions
|
|
|
(0.16
|
)
|
|
|
(0.09
|
)
|
|
|
(0.02
|
)
|
|
|
—
|
|
|
|
(0.01
|
)
|
|
|
(0.61
|
)
|
|
Net asset value, end of period
|
|
$
|
10.62
|
|
|
$
|
9.96
|
|
|
$
|
8.81
|
|
|
$
|
7.65
|
|
|
$
|
7.65
|
|
|
$
|
6.48
|
|
|
Total return
|
|
|
8.40
|
%
|
|
|
14.08
|
%
|
|
|
15.40
|
%
|
|
|
0.00
|
%
(4)
|
|
|
18.24
|
%
|
|
|
(31.46
|
)%
|
|
Supplemental data and ratios:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net assets, end of period (in thousands)
|
|
$
|
10,692
|
|
|
$
|
10,642
|
|
|
$
|
10,415
|
|
|
$
|
11,185
|
|
|
$
|
11,763
|
|
|
$
|
4,315
|
|
|
Ratio of gross operating expenses (prior to waiver
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
or reimbursements) to average net assets
|
|
|
2.45
|
%
|
|
|
2.84
|
%
|
|
|
2.82
|
%
|
|
|
3.22
|
%
(5)
|
|
|
4.24
|
%
|
|
|
3.44
|
%
|
|
Ratio of net operating expenses (after waiver
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
or reimbursements) to average net assets
(3)
|
|
|
1.95
|
%
|
|
|
2.34
|
%
|
|
|
2.32
|
%
|
|
|
2.72
|
%
(5)
|
|
|
3.14
|
%
|
|
|
2.75
|
%
|
|
Ratio of net investment income (loss) (prior to
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
waiver or reimbursements) to average net assets
|
|
|
1.33
|
%
|
|
|
1.07
|
%
|
|
|
0.54
|
%
|
|
|
0.30
|
%
(5)
|
|
|
(0.80
|
)%
|
|
|
(0.86
|
)%
|
|
Ratio of net investment income (loss) (after waiver
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
or reimbursements) to average net assets
(3)
|
|
|
1.83
|
%
|
|
|
1.57
|
%
|
|
|
1.04
|
%
|
|
|
0.80
|
%
(5)
|
|
|
0.30
|
%
|
|
|
(0.17
|
)%
|
|
Portfolio turnover rate
|
|
|
28.10
|
%
|
|
|
19.62
|
%
|
|
|
13.60
|
%
|
|
|
6.50
|
%
(4)
|
|
|
60.69
|
%
|
|
|
37.12
|
%
|
|
_______________
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) The Fund’s fiscal year was changed to August 31 to align with the other Jacob Funds.
(2) The financial highlights set forth herein include the historical financial highlights of the Wisdom Fund series of New Providence Investment Trust (the “Predecessor Fund”). The Predecessor Fund was reorganized into the Wisdom Fund on February 18, 2010. On December 1, 2009, before the reorganization, the adviser changed from Atlanta Investment Counsel, LLC to Jacob Asset Management of New York LLC. Information prior to February 18, 2010 reflects the performance of the Predecessor Fund’s Class B shares.
(3) The Adviser has contractually agreed, effective February 18, 2010 through January 2, 2014 to waive its advisory fees in an amount up to an annual rate of 0.50% of the Fund’s average daily net assets, to the extent that the Fund’s operating expense ratio exceeds 1.95%. Prior to November 30, 2009, the previous adviser agreed to waive operating expenses over 1.75% of the Fund’s average daily net assets, exclusive of interest, taxes, brokerage fees and 12b-1 fees.
(4) Not annualized.
(5) Annualized.
The accompanying notes are an integral part of these financial statements.
JACOB FUNDS INC.
NOTES TO THE FINANCIAL STATEMENTS
NOTE 1—DESCRIPTION OF ORGANIZATION
Jacob Funds Inc. (the “Corporation”) was organized as a Maryland corporation on July 13, 1999 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. The Corporation currently consists of four “diversified” series, the Jacob Internet Fund (the “Internet Fund”), the Jacob Small Cap Growth Fund (the “Small Cap Growth Fund”), the Jacob Micro Cap Growth Fund (the “Micro Cap Growth Fund”) and the Jacob Wisdom Fund (the “Wisdom Fund”), each a “Fund”, collectively the “Funds”, and the authorized capital stock of the Corporation consists of twenty billion shares of stock having a par value of one-tenth of one cent ($0.001) per share. The primary investment objective of the Internet Fund is long-term growth of capital with current income as a secondary objective. The primary investment objective of the Small Cap Growth Fund and Micro Cap Growth Fund is long-term growth of capital. The primary investment objective of the Wisdom Fund is to maximize total investment return consisting of a combination of income and capital appreciation.
The Internet Fund commenced operations on December 14, 1999. The Small Cap Growth Fund commenced operations on February 1, 2010 when it acquired the assets and liabilities of the Rockland Small Cap Growth Fund series of Rockland Funds Trust in a reorganization transaction (the Small Cap Growth Fund is the successor fund to the Rockland Small Cap Growth Fund). The Small Cap Growth Fund acquired the Class I and Class R shares of the Jacob Small Cap Growth Fund II (formerly, PineBridge US Small Cap Growth Fund) series of Jacob Funds II (formerly, the PineBridge Mutual Funds) (the “Predecessor Small Cap Growth Fund”) on November 12, 2012. The Micro Cap Growth Fund commenced operations on November 12, 2012 when it acquired the assets and liabilities of the Jacob Micro Cap Growth Fund (formerly, PineBridge US Micro Cap Growth Fund) series of Jacob Funds II (the “Predecessor Micro Cap Growth Fund”) in a reorganization transaction (the Micro Cap Growth Fund is the successor fund to the Predecessor Micro Cap Growth Fund). The Wisdom Fund commenced operations on February 18, 2010 when it acquired the assets and liabilities of the Wisdom Fund series of New Providence Investment Trust (the “Predecessor Wisdom Fund”) in a reorganization transaction (the Wisdom Fund is the successor fund to the Predecessor Wisdom Fund).
The Internet Fund and Wisdom Fund currently offer Investor Class shares. The Small Cap Growth Fund and Micro Cap Growth Fund currently offer Investor Class and Institutional Class shares. Each share of each class of a Fund represents an equal pro rata interest in such Fund and provides the shareholder the same voting, dividend, and other rights, except that shareholders of each class of a Fund have exclusive voting rights regarding any matter relating solely to that particular class. Investor Class shareholders may be charged a redemption fee of 2% if the shares are redeemed within 30 days of initial investment.
NOTE 2—SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently followed by the Funds. These policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”).
(a)
Investment Valuation
—Investment securities traded on a national securities exchange are valued at their market value determined by their last sales price in the principal market in which these securities are normally traded (except those traded on the NASDAQ National Market and Capital Market exchanges which are valued at the NASDAQ Official Closing Price (“NOCP”)), unless there are no transactions on the valuation date, in which case they are valued at the mean between the closing bid and ask prices. Securities traded over-the-counter are valued at the last reported sales price unless there is no reported sales price, in which case the mean between the closing bid and ask prices is used. Foreign securities, currencies and other assets denominated in foreign currencies are
NOTES TO THE FINANCIAL STATEMENTS (Continued)
translated into U.S. dollars at the exchange rate of such currencies. Foreign equity securities are valued at the last sale price at the close of the exchange on which the security is principally traded. Debt securities with maturities of 60 days or less are valued at amortized cost, which approximates market value. Short-term securities with 60 days or less remaining to maturity are, unless conditions indicate otherwise, amortized to maturity based on their cost to a Fund if acquired within 60 days of maturity or, if already held by a Fund on the 60th day, based on the value determined on the 61st day. If amortized cost does not approximate fair value, short-term securities are reported at fair value. Where market quotations are not readily available, are unreliable or when values have been materially affected by events occurring before the close of U.S. markets but after the close of the securities’ primary markets, securities are valued at fair value using procedures approved by the Board of Directors that are designed to determine a security’s fair value.
The Funds adhere to fair valuation accounting standards which provide an authoritative definition of fair value and set out a hierarchy for measuring fair value. These standards require disclosures about the various inputs and valuation techniques used to develop the measurements of fair value and a discussion in changes in valuation techniques and related inputs during the period. These standards define fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy is organized into three levels based upon the assumptions (referred to as “inputs”) used in pricing the asset or liability. These standards state that “observable inputs” reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from independent sources and “unobservable inputs” reflect an entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability.
Summary of Fair Value Exposure
Various inputs are used in determining the value of the Funds’ investments. These inputs are summarized in the three broad levels listed below:
|
Level 1—Unadjusted quoted prices in active markets for identical assets or liabilities that the Funds have the ability to access.
|
|
Level 2—Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument in an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data.
|
|
Level 3—Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Funds’ own assumptions about the assumptions a market participant would use in valuing the asset or liability, and based on the best information available.
|
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.
JACOB FUNDS INC.
NOTES TO THE FINANCIAL STATEMENTS (Continued)
August 31, 2013
The following is a summary of the inputs used to value the Internet Fund’s investments as of August 31, 2013:
|
|
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
|
|
Common Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Internet—Commerce
|
|
$
|
5,804,975
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,804,975
|
|
|
|
Internet—Infrastructure
|
|
|
20,076,165
|
|
|
|
—
|
|
|
|
—
|
|
|
|
20,076,165
|
|
|
|
Internet—Media
|
|
|
9,982,876
|
|
|
|
1,401,069
|
|
|
|
—
|
|
|
|
11,383,945
|
|
|
|
Total Common Stock
|
|
|
35,864,016
|
|
|
|
1,401,069
|
|
|
|
—
|
|
|
|
37,265,085
|
|
|
|
Short Term Investment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Money Market Fund
|
|
|
3,600,552
|
|
|
|
—
|
|
|
|
—
|
|
|
|
3,600,552
|
|
|
|
Investments Purchased With Cash
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds From Securities Lending
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial Paper
|
|
|
—
|
|
|
|
—
|
|
|
|
145,193
|
|
|
|
145,193
|
|
|
|
Total Investments in Securities
|
|
$
|
39,464,568
|
|
|
$
|
1,401,069
|
|
|
$
|
145,193
|
|
|
$
|
41,010,830
|
|
There were no transfers into or out of Level 1, Level 2 and Level 3 during the reporting period, as compared to their classification from the most recent annual report.
|
|
|
|
Investments
|
|
|
|
Description
|
|
in Securities
|
|
|
|
Balance as of August 31, 2012
|
|
$
|
137,176
|
|
|
|
Change in unrealized appreciation (depreciation)
|
|
|
34,719
|
|
|
|
Sales
|
|
|
(26,702
|
)
|
|
|
Transfers in and/or out of Level 3*
|
|
|
—
|
|
|
|
Balance as of August 31, 2013
|
|
$
|
145,193
|
|
|
|
____________
|
|
|
|
|
* The informatin used in the above reconciliation represents fiscal year to date activity for any investments identified as using Level 3 inputs at either the beginning or end of the current fiscal period. Transfers in or out of Level 3 represents either the beginning value (for transfers in) or ending value (for transfers out) of any security or instrument where a change in the pricing level occurred from the beginning to the end of the period.
The chart below represents quantitative disclosure about significant observable inputs for Level 3 fair value measurements.
|
|
|
Fair Value at
|
Valuation
|
Observable
|
|
|
|
August 31, 2013
|
Techniques
|
Inputs
|
|
|
Ottimo Funding LLC
|
$145,193
|
Market Quotations
|
Average price received from three
|
|
|
|
|
|
Prominent Pricing Services.
|
|
|
|
|
|
|
JACOB FUNDS INC.
NOTES TO THE FINANCIAL STATEMENTS (Continued)
The following is a summary of the inputs used to value the Small Cap Growth Fund’s investments as of
August 31, 2013:
|
|
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
|
|
Common Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Arts, Entertainment, and Recreation
|
|
$
|
1,122,471
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,122,471
|
|
|
|
Biotech & Pharmaceuticals
|
|
|
2,546,577
|
|
|
|
—
|
|
|
|
—
|
|
|
|
2,546,577
|
|
|
|
Energy—Exploration & Production
|
|
|
1,810,105
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,810,105
|
|
|
|
Energy—Infrastructure & Services
|
|
|
342,540
|
|
|
|
—
|
|
|
|
—
|
|
|
|
342,540
|
|
|
|
Financial
|
|
|
524,018
|
|
|
|
—
|
|
|
|
—
|
|
|
|
524,018
|
|
|
|
Health Care Providers & Services
|
|
|
433,056
|
|
|
|
—
|
|
|
|
—
|
|
|
|
433,056
|
|
|
|
Industrial
|
|
|
1,215,364
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,215,364
|
|
|
|
Medical Devices
|
|
|
1,278,883
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,278,883
|
|
|
|
Retail & Restaurants
|
|
|
992,459
|
|
|
|
—
|
|
|
|
—
|
|
|
|
992,459
|
|
|
|
Technology—Hardware
|
|
|
2,285,212
|
|
|
|
—
|
|
|
|
—
|
|
|
|
2,285,212
|
|
|
|
Technology—Software & Services
|
|
|
3,730,927
|
|
|
|
—
|
|
|
|
—
|
|
|
|
3,730,927
|
|
|
|
Total Common Stock
|
|
|
16,281,612
|
|
|
|
—
|
|
|
|
—
|
|
|
|
16,281,612
|
|
|
|
Short Term Investment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Money Market Fund
|
|
|
1,169,772
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,169,772
|
|
|
|
Total Investments in Securities
|
|
$
|
17,451,384
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
17,451,384
|
|
There were no transfers into or out of Level 1, Level 2 and Level 3 during the reporting period, as compared to their classification from the most recent annual report.
The following is a summary of the inputs used to value the Micro Cap Growth Fund’s investments as of
August 31, 2013:
|
|
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
|
|
Arts, Entertainment, and Recreation
|
|
$
|
901,128
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
901,128
|
|
|
|
Biotech & Pharmaceuticals
|
|
|
2,401,183
|
|
|
|
—
|
|
|
|
—
|
|
|
|
2,401,183
|
|
|
|
Energy—Exploration & Production
|
|
|
583,710
|
|
|
|
—
|
|
|
|
—
|
|
|
|
583,710
|
|
|
|
Financial
|
|
|
447,990
|
|
|
|
—
|
|
|
|
—
|
|
|
|
447,990
|
|
|
|
Food & Beverages
|
|
|
393,623
|
|
|
|
—
|
|
|
|
—
|
|
|
|
393,623
|
|
|
|
Health Care Providers & Services
|
|
|
358,104
|
|
|
|
—
|
|
|
|
—
|
|
|
|
358,104
|
|
|
|
Industrial
|
|
|
2,107,633
|
|
|
|
—
|
|
|
|
—
|
|
|
|
2,107,633
|
|
|
|
Medical Devices
|
|
|
1,933,593
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,933,593
|
|
|
|
Retail & Restaurants
|
|
|
588,174
|
|
|
|
—
|
|
|
|
—
|
|
|
|
588,174
|
|
|
|
Technology—Hardware
|
|
|
1,001,410
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,001,410
|
|
|
|
Technology—Software & Services
|
|
|
3,268,106
|
|
|
|
—
|
|
|
|
—
|
|
|
|
3,268,106
|
|
|
|
Total Common Stock
|
|
|
13,984,654
|
|
|
|
—
|
|
|
|
—
|
|
|
|
13,984,654
|
|
|
|
Short Term Investment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Money Market Fund
|
|
|
236,719
|
|
|
|
—
|
|
|
|
—
|
|
|
|
236,719
|
|
|
|
Total Investments in Securities
|
|
$
|
14,221,373
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
14,221,373
|
|
There were no transfers into or out of Level 1, Level 2 and Level 3 during the reporting period, as compared to their classification from the most recent annual report.
JACOB FUNDS INC.
NOTES TO THE FINANCIAL STATEMENTS (Continued)
The following is a summary of the inputs used to value the Wisdom Fund’s investments as of August 31, 2013:
|
|
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
|
|
Common Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Air Freight & Logistics
|
|
$
|
205,392
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
205,392
|
|
|
|
Beverages
|
|
|
755,750
|
|
|
|
—
|
|
|
|
—
|
|
|
|
755,750
|
|
|
|
Commercial Banks
|
|
|
288,960
|
|
|
|
—
|
|
|
|
—
|
|
|
|
288,960
|
|
|
|
Commercial Services & Supplies
|
|
|
645,384
|
|
|
|
—
|
|
|
|
—
|
|
|
|
645,384
|
|
|
|
Consumer Finance
|
|
|
897,445
|
|
|
|
—
|
|
|
|
—
|
|
|
|
897,445
|
|
|
|
Consumer Non—Cyclical
|
|
|
478,740
|
|
|
|
—
|
|
|
|
—
|
|
|
|
478,740
|
|
|
|
Diversified Manufacturing
|
|
|
255,150
|
|
|
|
—
|
|
|
|
—
|
|
|
|
255,150
|
|
|
|
Food & Staples Retailing
|
|
|
515,660
|
|
|
|
—
|
|
|
|
—
|
|
|
|
515,660
|
|
|
|
Food Products
|
|
|
621,614
|
|
|
|
—
|
|
|
|
—
|
|
|
|
621,614
|
|
|
|
Health Care Equipment & Supplies
|
|
|
656,982
|
|
|
|
—
|
|
|
|
—
|
|
|
|
656,982
|
|
|
|
Hotels, Restaurants & Leisure
|
|
|
283,080
|
|
|
|
—
|
|
|
|
—
|
|
|
|
283,080
|
|
|
|
Insurance
|
|
|
500,440
|
|
|
|
—
|
|
|
|
—
|
|
|
|
500,440
|
|
|
|
Machinery
|
|
|
857,058
|
|
|
|
—
|
|
|
|
—
|
|
|
|
857,058
|
|
|
|
Oil, Gas & Consumable Fuels
|
|
|
715,920
|
|
|
|
—
|
|
|
|
—
|
|
|
|
715,920
|
|
|
|
Pharmaceuticals
|
|
|
200,676
|
|
|
|
—
|
|
|
|
—
|
|
|
|
200,676
|
|
|
|
Technology Hardware & Software
|
|
|
906,570
|
|
|
|
—
|
|
|
|
—
|
|
|
|
906,570
|
|
|
|
Textiles, Apparel & Luxury Goods
|
|
|
1,005,471
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,005,471
|
|
|
|
Total Common Stock
|
|
|
9,790,292
|
|
|
|
—
|
|
|
|
—
|
|
|
|
9,790,292
|
|
|
|
Short Term Investment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Money Market Fund
|
|
|
993,751
|
|
|
|
—
|
|
|
|
—
|
|
|
|
993,751
|
|
|
|
Total Investments in Securities
|
|
$
|
10,784,043
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
10,784,043
|
|
There were no transfers into or out of Level 1, Level 2 and Level 3 during the reporting period, as compared to their classification from the most recent annual report.
(b)
Income Recognition
—Interest income is accrued as earned. Dividend income is recorded on the ex-dividend date. All discounts and premiums are amortized using the effective interest method for tax and financial reporting purposes.
(c)
Expenses
—Expenses that are not attributable to a particular Fund are typically allocated in proportion to each Fund’s respective net assets. Expenses are allocated to a particular share class in proportion to each class’s respective net assets. Expenses are recorded on an accrual basis.
(d)
Securities Transactions
—Security transactions are accounted for on trade date. Realized gains and losses on securities sold are determined using specific identification.
(e)
Foreign Currency Transactions
—The books and records are maintained in U.S. dollars. Foreign currency denominated transactions (i.e., market value of investment securities, assets and liabilities, purchases and sales of investment securities, and income and expenses) are translated into U.S. dollars at the current rate of exchange.
JACOB FUNDS INC.
NOTES TO THE FINANCIAL STATEMENTS (Continued)
The Funds do not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss from investments.
(f)
Distributions to Shareholders
—The Funds record distributions to shareholders on the ex-dividend date. Dividends from net investment income, if any, are declared and paid annually. Distributions of net realized capital gains, if any, will be declared and distributed annually. The amounts of distributions from net investment income and net realized capital gains are determined in accordance with federal income tax regulations, which may differ from those amounts determined under GAAP. These book/tax differences are either temporary or permanent in nature. To the extent these differences are permanent, reclassifications are made in the capital accounts in the period that the differences arise. The reclassifications have no effect on net assets or net asset value per share.
(g)
Federal Income Taxes
—The Funds comply with provisions of Subchapter M of the Internal Revenue Code applicable to regulated investment companies, including the distribution of substantially all of the Funds’ taxable income. Accordingly, no provision for federal income taxes is considered necessary in the financial statements.
The Funds follow accounting standards regarding recognition and measurement of tax positions taken on a tax return. No material uncertain tax positions existed as of August 31, 2013. As a result, the Funds have not recorded any liabilities for uncertain tax positions as of August 31, 2013. The standards require the Funds to analyze all open tax years, as defined by the Statute of Limitations, for all major jurisdictions. Open tax years are those that are open for examinations by taxing authorities. Major jurisdictions for the Funds only relate to federal tax years. As of August 31, 2013, open federal tax years include the tax years ended August 31, 2010 through August 31, 2013 for the Internet Fund, the period ended August 31, 2010, and tax years ended August 31, 2011 through August 31, 2013 for the Small Cap Growth Fund, the tax years ended November 30, 2010 through November 30, 2012, and the period ended August 31, 2013 for the Micro Cap Growth Fund, and the tax year ended May 31, 2010, the period ended August 31, 2010, and the years ended August 31, 2011 through August 31, 2013 for the Wisdom Fund.
(h)
Use of Estimates
—The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
(i)
Contingencies and Commitments
—The Funds indemnify the Corporation’s Officers and Directors for certain liabilities that might arise from their performance of their duties to the Funds. Additionally, in the normal course of business, the Funds enter into contracts that contain a variety of representations and warranties and which provide general indemnifications. Each Fund’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Funds that have not yet occurred. However, based on experience, the Corporation expects the risk of loss to be remote.
JACOB FUNDS INC.
NOTES TO THE FINANCIAL STATEMENTS (Continued)
NOTE 3—CAPITAL SHARE TRANSACTIONS
At August 31, 2013 there were twenty billion shares, $0.001 par value, authorized for the Corporation. Transactions in shares of the Internet Fund were as follows:
|
|
|
|
Year Ended
|
|
|
Year Ended
|
|
|
|
|
|
August 31, 2013
|
|
|
August 31, 2012
|
|
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Shares
|
|
|
Amount
|
|
|
|
Sales
|
|
|
485,385
|
|
|
$
|
1,586,863
|
|
|
|
1,957,940
|
|
|
$
|
5,838,275
|
|
|
|
Redemptions
|
|
|
(3,149,980
|
)
|
|
|
(9,820,679
|
)
|
|
|
(2,760,849
|
)
|
|
|
(8,143,073
|
)
|
|
|
Redemption fees
|
|
|
—
|
|
|
|
1,711
|
|
|
|
—
|
|
|
|
4,599
|
|
|
|
Net decrease
|
|
|
(2,664,595
|
)
|
|
$
|
(8,232,105
|
)
|
|
|
(802,909
|
)
|
|
$
|
(2,300,199
|
)
|
|
|
Shares Outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Beginning of year
|
|
|
13,174,251
|
|
|
|
|
|
|
|
13,977,160
|
|
|
|
|
|
|
|
End of year
|
|
|
10,509,656
|
|
|
|
|
|
|
|
13,174,251
|
|
|
|
|
|
Transactions in shares of the Small Cap Growth Fund were as follows:
Institutional Class
|
|
|
|
Period Ended
|
|
|
|
|
|
|
August 31, 2013*
|
|
|
|
|
|
|
Shares
|
|
|
Amount
|
|
|
|
|
Sales
|
|
|
3,852
|
|
|
$
|
57,647
|
|
|
|
|
Sales in connection
|
|
|
|
|
|
|
|
|
|
|
|
with reorganization
(1)
|
|
|
682,698
|
|
|
|
8,
614,528
|
|
|
|
|
Redemptions
|
|
|
(113,224
|
)
|
|
|
(1,564,048
|
)
|
|
|
|
Redemption fees
|
|
|
—
|
|
|
|
—
|
|
|
|
|
Net increase
|
|
|
573,326
|
|
|
$
|
7,108,127
|
|
|
|
|
Shares Outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
Beginning of period
|
|
|
—
|
|
|
|
|
|
|
|
|
End of period
|
|
|
573,326
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*
|
|
The Small Cap Growth Fund Institutional Class shares commenced operations on November 12, 2012.
|
|
(1)
|
|
The shares and amounts represent activity as a result of the Small Cap Growth Fund’s acquisition of the Predecessor Small Cap Growth Fund on November 12, 2012.
|
JACOB FUNDS INC.
NOTES TO THE FINANCIAL STATEMENTS (Continued)
Investor Class
|
|
|
|
Year Ended
|
|
|
Year Ended
|
|
|
|
|
|
August 31, 2013
|
|
|
August 31, 2012
|
|
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Shares
|
|
|
Amount
|
|
|
|
Sales
|
|
|
18,612
|
|
|
$
|
285,998
|
|
|
|
61,059
|
|
|
$
|
838,030
|
|
|
|
Sales in connection
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
with reorganization
(1)
|
|
|
146,977
|
|
|
|
1,854,605
|
|
|
|
—
|
|
|
|
—
|
|
|
|
Reinvestments
|
|
|
—
|
|
|
|
—
|
|
|
|
18,902
|
|
|
|
240,803
|
|
|
|
Redemptions
|
|
|
(143,303
|
)
|
|
|
(2,123,788
|
)
|
|
|
(155,451
|
)
|
|
|
(2,133,300
|
)
|
|
|
Redemption fees
|
|
|
—
|
|
|
|
50
|
|
|
|
—
|
|
|
|
204
|
|
|
|
Net increase (decrease)
|
|
|
22,286
|
|
|
$
|
16,865
|
|
|
|
(75,490
|
)
|
|
$
|
(1,054,263
|
)
|
|
|
Shares Outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Beginning of year
|
|
|
388,258
|
|
|
|
|
|
|
|
463,748
|
|
|
|
|
|
|
|
End of year
|
|
|
410,544
|
|
|
|
|
|
|
|
388,258
|
|
|
|
|
|
|
|
Total increase (decrease)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
for the Fund
|
|
|
|
|
|
$
|
7,124,992
|
|
|
|
|
|
|
$
|
(1,054,263
|
)
|
|
|
____________
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
The shares and amounts represent activity as a result of the Small Cap Growth Fund’s acquisition of the Predecessor Small Cap Growth Fund on November 12, 2012.
|
Transactions in shares of the Micro Cap Growth Fund were as follows:
Institutional Class
|
|
|
|
Nine Months Ended
|
|
|
Year Ended
|
|
|
Year Ended
|
|
|
|
|
|
August 31, 2013*
|
|
|
November 30, 2012**
|
|
|
November 30, 2011***
|
|
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Shares
|
|
|
Amount
|
|
|
Shares
|
|
|
Amount
|
|
|
|
Sales
|
|
|
3,876
|
|
|
$
|
82,890
|
|
|
|
482,067
|
|
|
$
|
9,741,286
|
|
|
|
900,671
|
|
|
$
|
17,612,466
|
|
|
|
Redemptions
|
|
|
(1,705,004
|
)
|
|
|
(33,189,009
|
)
|
|
|
(1,106,233
|
)
|
|
|
(21,879,008
|
)
|
|
|
(1,026,971
|
)
|
|
|
(20,070,981
|
)
|
|
|
Net decrease
|
|
|
(1,701,128
|
)
|
|
$
|
(33,106,119
|
)
|
|
|
(624,166
|
)
|
|
$
|
(12,137,722
|
)
|
|
|
(126,300
|
)
|
|
$
|
(2,458,515
|
)
|
|
|
Shares Outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Beginning of period
|
|
|
2,127,759
|
|
|
|
|
|
|
|
2,751,925
|
|
|
|
|
|
|
|
2,878,225
|
|
|
|
|
|
|
|
End of period
|
|
|
426,631
|
|
|
|
|
|
|
|
2,127,759
|
|
|
|
|
|
|
|
2,751,925
|
|
|
|
|
|
|
|
____________
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*
|
|
The Predecessor Micro Cap Growth Fund had a fiscal year end of November 30, so the current activity begins on December 1, 2012. The fiscal year was changed to August 31 to align with the other Jacob Funds.
|
|
|
**
|
|
On November 12, 2012, Class I shares of the Predecessor Micro Cap Growth Fund were reorganized into Institutional Class shares of the Fund.
|
|
|
***
|
|
The shares and amounts represent the Class I shares of the Predecessor Micro Cap Growth Fund.
|
|
|
|
|
|
JACOB FUNDS INC.
NOTES TO THE FINANCIAL STATEMENTS (Continued)
Investor Class
|
|
|
|
Nine Months Ended
|
|
|
Year Ended
|
|
|
Year Ended
|
|
|
|
|
|
August 31, 2013*
|
|
|
November 30, 2012**
|
|
|
November 30, 2011***
|
|
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Shares
|
|
|
Amount
|
|
|
Shares
|
|
|
Amount
|
|
|
|
Sales
|
|
|
4,462
|
|
|
$
|
98,732
|
|
|
|
29,469
|
|
|
$
|
579,735
|
|
|
|
2,387,288
|
|
|
$
|
46,914,715
|
|
|
|
Redemptions
|
|
|
(93,757
|
)
|
|
|
(1,937,653
|
)
|
|
|
(322,495
|
)
|
|
|
(6,190,915
|
)
|
|
|
(2,393,659
|
)
|
|
|
(41,283,251
|
)
|
|
|
Redemption fees
|
|
|
—
|
|
|
|
8
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
Net increase (decrease)
|
|
|
(89,295
|
)
|
|
$
|
(1,838,913
|
)
|
|
|
(293,026
|
)
|
|
$
|
(5,611,180
|
)
|
|
|
(6,371
|
)
|
|
$
|
5,631,464
|
|
|
|
Shares Outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Beginning of period
|
|
|
235,301
|
|
|
|
|
|
|
|
528,327
|
|
|
|
|
|
|
|
534,698
|
|
|
|
|
|
|
|
End of period
|
|
|
146,006
|
|
|
|
|
|
|
|
235,301
|
|
|
|
|
|
|
|
528,327
|
|
|
|
|
|
|
|
Total increase (decrease)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
for the Fund
|
|
|
|
|
|
$
|
(34,945,032
|
)
|
|
|
|
|
|
$
|
(17,748,902
|
)
|
|
|
|
|
|
$
|
3,172,949
|
|
|
|
____________
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*
|
|
The Predecessor Micro Cap Growth Fund had a fiscal year end of November 30, so the current activity begins on December 1, 2012. The fiscal year end was changed to August 31 to align with the other Jacob Funds.
|
|
|
**
|
|
On November 12, 2012, Class R shares of the Predecessor Micro Cap Growth Fund were reorganized into Investor Class shares of the Fund.
|
|
|
***
|
|
The shares and amounts represent the Class R shares of the Predecessor Micro Cap Growth Fund.
|
Transactions in shares of the Wisdom Fund were as follows:
|
|
|
|
Year Ended
|
|
|
Year Ended
|
|
|
|
|
|
August 31, 2013
|
|
|
August 31, 2012
|
|
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Shares
|
|
|
Amount
|
|
|
|
Sales
|
|
|
14,963
|
|
|
$
|
153,427
|
|
|
|
14,580
|
|
|
$
|
136,160
|
|
|
|
Reinvestments
|
|
|
14,364
|
|
|
|
138,611
|
|
|
|
9,530
|
|
|
|
84,721
|
|
|
|
Redemptions
|
|
|
(91,367
|
)
|
|
|
(941,399
|
)
|
|
|
(138,230
|
)
|
|
|
(1,293,462
|
)
|
|
|
Net decrease
|
|
|
(62,040
|
)
|
|
$
|
(649,361
|
)
|
|
|
(114,120
|
)
|
|
$
|
(1,072,581
|
)
|
|
|
Shares Outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Beginning of year
|
|
|
1,068,539
|
|
|
|
|
|
|
|
1,182,659
|
|
|
|
|
|
|
|
End of year
|
|
|
1,006,499
|
|
|
|
|
|
|
|
1,068,539
|
|
|
|
|
|
A 2% redemption fee is assessed on any Investor Class shares of the Funds, except those received from reinvested distributions, that are sold within 30 days following their purchase date.
From time to time, the Funds may have a concentration of shareholders holding a significant percentage of shares outstanding. Investment activities of these shareholders could have a material impact on the Funds. The following table shows the number of shareholders owning greater than 10% of the outstanding shares in each of the Funds at August 31, 2013:
JACOB FUNDS INC.
NOTES TO THE FINANCIAL STATEMENTS (Continued)
|
|
|
Number of shareholders owning greater
|
|
|
|
Fund
|
than 10% of outstanding Fund shares
|
|
|
|
Small Cap Growth Fund Institutional Class
|
1
|
|
|
|
Micro Cap Growth Fund Institutional Class
|
2
|
|
|
|
Wisdom Fund
|
2
|
|
NOTE 4—INVESTMENT TRANSACTIONS
During the year ended August 31, 2013 for the Internet Fund, the Small Cap Growth Fund and the Wisdom Fund and the nine months ended August 31, 2013 for the Micro Cap Growth Fund, purchases and sales of investment securities (excluding short-term investments) were as follows:
|
|
Fund
|
|
Purchases
|
|
|
Sales
|
|
|
|
Internet Fund
|
|
$
|
16,039,668
|
|
|
$
|
26,568,745
|
|
|
|
Small Cap Growth Fund
|
|
|
10,537,752
|
|
|
|
14,822,769
|
|
|
|
Micro Cap Growth Fund
|
|
|
6,749,679
|
|
|
|
39,916,740
|
|
|
|
Wisdom Fund
|
|
|
2,977,922
|
|
|
|
4,380,961
|
|
The Funds did not purchase long-term U.S. Government securities as a part of their investment strategies during the periods ended August 31, 2013.
NOTE 5—TAX INFORMATION
At August 31, 2013, the components of accumulated earnings/(losses) on a tax basis for the Funds were as follows:
|
|
|
|
Internet
|
|
|
Small Cap
|
|
|
Micro Cap
|
|
|
Wisdom
|
|
|
|
|
|
Fund
|
|
|
Growth Fund
|
|
|
Growth Fund
|
|
|
Fund
|
|
|
|
Cost of Investments
|
|
$
|
25,529,504
|
|
|
$
|
13,506,180
|
|
|
$
|
11,157,554
|
|
|
$
|
7,987,639
|
|
|
|
Gross unrealized appreciation
|
|
|
16,718,861
|
|
|
|
4,544,603
|
|
|
|
3,401,605
|
|
|
|
2,926,677
|
|
|
|
Gross unrealized depreciation
|
|
|
(1,237,535
|
)
|
|
|
(599,399
|
)
|
|
|
(337,786
|
)
|
|
|
(130,273
|
)
|
|
|
Net unrealized appreciation
|
|
$
|
15,481,326
|
|
|
$
|
3,945,204
|
|
|
$
|
3,063,819
|
|
|
$
|
2,796,404
|
|
|
|
Undistributed ordinary income
|
|
|
—
|
|
|
|
—
|
|
|
|
2,054,062
|
|
|
|
185,925
|
|
|
|
Undistributed long-term capital gains
|
|
|
—
|
|
|
|
—
|
|
|
|
714,156
|
|
|
|
—
|
|
|
|
Total distributable earnings
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,768,218
|
|
|
$
|
185,925
|
|
|
|
Other accumulated losses
|
|
$
|
(5,349,156
|
)
|
|
$
|
(9,716,182
|
)
|
|
$
|
(1,694,149
|
)
|
|
$
|
(815,690
|
)
|
|
|
Total accumulated earnings/(losses)
|
|
$
|
10,132,170
|
|
|
$
|
(5,770,978
|
)
|
|
$
|
4,137,888
|
|
|
$
|
2,166,639
|
|
At August 31, 2013 the Internet Fund deferred, on a tax basis, post October losses of $665,030 and the Internet Fund and Small Cap Growth Fund deferred, on a tax basis, post December ordinary losses of $498,764 and $487,345, respectively.
The differences between cost amounts for book purposes and tax purposes are primarily due to the tax deferral of losses on wash sales, passive foreign investment companies (“PFICs”) and real estate investment trusts (“REITs”). At August 31, 2013, the Funds had accumulated net realized capital loss carryovers as follows:
JACOB FUNDS INC.
NOTES TO THE FINANCIAL STATEMENTS (Continued)
|
|
Internet
|
|
|
Small Cap
|
|
|
Micro Cap
|
|
|
Wisdom
|
|
|
|
|
Fund
|
|
|
Growth Fund
|
|
|
Growth Fund
|
|
|
Fund
|
|
Expiration
|
|
|
$
|
—
|
|
|
$
|
6,919,217
|
|
|
$
|
—
|
|
|
$
|
—
|
|
8/31/2016
|
|
|
|
—
|
|
|
|
1,515,745
|
|
|
|
1,694,149
|
|
|
|
380,690
|
|
8/31/2017
|
|
|
|
4,185,362
|
|
|
|
793,875
|
|
|
|
—
|
|
|
|
435,000
|
|
8/31/2018
|
|
|
$
|
4,185,362
|
|
|
$
|
9,228,837
|
|
|
$
|
1,694,149
|
|
|
$
|
815,690
|
|
|
To the extent the Funds realize future net capital gains, taxable distributions to its shareholders will be offset by any unused capital loss carryover. For the periods ended August 31, 2013, the Internet Fund, Small Cap Growth Fund, Micro Cap Growth Fund and Wisdom Fund utilized capital loss carry forwards of $1,998,454, $1,369,699, $286,613 and $449,194, respectively.
Due to the rule under section 382 of the Internal Revenue Code, the Micro Cap Growth Fund’s capital loss carryforward of $1,694,149 is subject to annual limitations over the next 4 years. The Fund will only be able to utilize $423,537 each year for the next 4 years.
As a result of a significant shareholder redemption during the period, limitations were placed on the allowable capital loss carryover pursuant to Internal Revenue Code Section 382. The amount of capital loss carryover written off in the fiscal period ended August 31, 2013 was $10,905,355.
The Internet Fund made no distributions during the fiscal years ended August 31, 2013 and 2012. The Small Cap Growth Fund made no distributions during the fiscal year ended August 31, 2013 and paid $267,796 out of ordinary income during the fiscal year ended August 31, 2012. The Micro Cap Growth Fund made no distributions during the nine months ended August 31, 2013 and fiscal years ended November 30, 2012 and 2011. The Wisdom Fund paid $169,237 out of ordinary income during the fiscal year ended August 31, 2013 and paid $104,302 out of ordinary income during the fiscal year ended August 31, 2012.
Reclassification Adjustments:
Capital stock, undistributed net investment income (loss), and accumulated net realized gain (loss) have been adjusted in the Statements of Assets and Liabilities for permanent book-tax differences for the Funds.
Differences primarily relate to the tax treatment of net operating losses, expiring capital losses, foreign currency gains and losses, and differing book/tax treatment of the deduction of equalization debits for tax purposes. To the extent these book and tax differences are permanent in nature, such amounts are reclassified at the end of the fiscal year among capital stock, undistributed net investment income (loss) and undistributed net realized gain (loss) on investments. Accordingly, at August 31, 2013 reclassifications were recorded as follows:
|
|
|
|
Small Cap
|
|
|
Micro Cap
|
|
|
|
|
|
|
|
|
|
|
|
Internet
|
|
|
Growth
|
|
|
Growth
|
|
|
Wisdom
|
|
|
|
|
|
Fund
|
|
|
Fund
|
|
|
Fund
|
|
|
Fund
|
|
|
|
Accumulated net investment income (loss)
|
|
$
|
845,402
|
|
|
$
|
(43
|
)
|
|
$
|
245,413
|
|
|
$
|
(10,870
|
)
|
|
|
Accumulated net realized loss on investments
|
|
|
—
|
|
|
|
3,835,206
|
|
|
|
10,024,368
|
|
|
|
10,870
|
|
|
|
Capital Stock
|
|
|
(845,402
|
)
|
|
|
(3,835,163
|
)
|
|
|
(10,269,781
|
)
|
|
|
—
|
|
NOTE 6—INVESTMENT ADVISORY AND OTHER AGREEMENTS
The Corporation has entered into Investment Advisory Agreements (the “Advisory Agreements”) with Jacob Asset Management of New York LLC (the “Adviser”), with whom certain Officers and a Director of the Board are affiliated,
JACOB FUNDS INC.
NOTES TO THE FINANCIAL STATEMENTS (Continued)
to furnish investment advisory services to the Funds. Under the terms of the Advisory Agreements, the Corporation, on behalf of the Funds, compensates the Adviser for its management services based on an annual rate of 1.25% of the Internet Fund’s average daily net assets; 0.90% of the Small Cap Growth Fund’s average daily net assets; 1.20% of the Micro Cap Growth Fund’s average daily net assets; and 0.50% of the Wisdom Fund’s average daily net assets up to $500 million and 0.40% of annual average daily net assets over $500 million.
The Adviser has contractually agreed to waive its advisory fees in an amount up to an annual rate of 0.10% of the Internet Fund’s average daily net assets to the extent the Internet Fund’s total annual operating expenses (excluding any taxes, interest, brokerage fees, acquired fund fees and expenses and extraordinary expenses) exceed 2.95% of the average daily net assets through January 2, 2014. The Adviser has the ability to recoup amounts waived for a period of three years following such fee waivers to the extent that such recoupment by the Adviser will not cause the Internet Fund to exceed any applicable expense limitation in place when the fee was waived. For the year ended August 31, 2013, the Adviser did not waive any fees with respect to the Internet Fund.
The Adviser contractually agreed to waive its advisory fees in an amount up to an annual rate of 0.90% of the Small Cap Growth Fund’s average daily net assets, to the extent that the Fund’s total annual operating expenses (excluding any taxes, interest, brokerage fees, acquired fund fees and expenses and extraordinary expenses) exceed 2.45% of average daily net assets through November 11, 2012. The Adviser has the ability to recoup amounts waived for a period of three years following such fee waivers to the extent that such recoupment by the Adviser will not cause the Small Cap Growth Fund’s expenses to exceed 2.45%. For the period from September 1, 2012 through November 11, 2012, fees of $9,202 were waived by the Adviser with respect to the Small Cap Growth Fund.
Effective November 12, 2012 (date of reorganization of the Predecessor Small Cap Growth Fund into the Small Cap Growth Fund) the Adviser contractually agreed to waive up to 100% of its advisory fee to the extent the Fund’s total annual operating expenses (excluding any taxes, interest, brokerage fees, acquired fund fees and expenses and extraordinary expenses) exceed 2.25% or 1.95% for Investor Class and Institutional Class Shares, respectively, of each class’ average daily net assets through January 2, 2014. The Adviser has the ability to recoup amounts waived for a period of three years following such fee waivers to the extent that such recoupment by the Adviser will not cause the Fund to exceed any applicable expense limitation in place when the fee is waived. For the period from November 12, 2012 through August 31, 2013, fees of $50,266 were waived by the Adviser with respect to the Small Cap Growth Fund.
Effective November 12, 2012 (date of reorganization of the Predecessor Micro Cap Growth Fund into the Micro Cap Growth Fund) the Adviser contractually agreed to waive up to 100% of its advisory fee to the extent the Micro Cap Growth Fund’s total annual operating expenses (excluding any taxes, interest, brokerage fees, acquired fund fees and expenses and extraordinary expenses) exceed 2.45% or 2.15% for Investor Class and Institutional Class Shares, respectively, of each class’ average daily net assets through January 2, 2014. The Adviser has the ability to recoup amounts waived for a period of three years following such fee waivers to the extent that such recoupment by the Adviser will not cause the Fund to exceed any applicable expense limitation in place when the fee is waived. For the nine months ended August 31, 2013, fees of $104,217 were waived by the Adviser with respect to the Micro Cap Growth Fund.
The Adviser has contractually agreed to waive its advisory fees in an amount up to an annual rate of 0.50% of the Wisdom Fund’s average daily net assets, to the extent that the Fund’s total annual operating expenses (excluding any taxes, interest brokerage fees, acquired fund fees and expenses and extraordinary expenses) exceed 1.95% of average daily net assets through January 2, 2014. The Adviser has the ability to recoup amounts waived for a period of three
JACOB FUNDS INC.
NOTES TO THE FINANCIAL STATEMENTS (Continued)
years following such fee waivers to the extent that such recoupment by the Adviser will not cause the Wisdom Fund’s expenses to exceed 1.95%. For the year ended August 31, 2013, fees of $53,874 were waived by the Adviser with respect to the Wisdom Fund.
Following is a schedule of when fees may be recouped:
|
|
Small Cap
|
|
|
Micro Cap
|
|
|
Wisdom
|
|
|
|
|
Growth Fund
|
|
|
Growth Fund
|
|
|
Fund
|
|
Expiration
|
|
|
$
|
57,146
|
|
|
$
|
—
|
|
|
$
|
56,022
|
|
August 31, 2014
|
|
|
|
53,238
|
|
|
|
—
|
|
|
|
52,573
|
|
August 31, 2015
|
|
|
|
—
|
|
|
|
19,566
|
|
|
|
—
|
|
November 30, 2015
|
|
|
|
59,468
|
|
|
|
104,217
|
|
|
|
53,874
|
|
August 31, 2016
|
|
|
$
|
169,852
|
|
|
$
|
123,783
|
|
|
$
|
162,469
|
|
|
U.S. Bancorp Fund Services, LLC serves as transfer agent, administrator and accounting services agent for the Funds. U.S. Bank, N.A. serves as custodian for the Funds. U.S. Bancorp Asset Management, Inc. serves as the securities lending agent. All providers receive customary fees for services rendered.
NOTE 7—SECURITIES LENDING
The Funds may lend portfolio securities equal in value to up to 33% of their total assets (including such loans) to borrowers under terms of participation in a securities lending program administered by U.S. Bancorp Asset Management, Inc. The Agreement requires that loans are collateralized at all times in an amount equal to at least 102% of the market value of any loaned securities at the time of the loan, plus accrued interest.
The Funds receive compensation in the form of fees and earn interest on the cash collateral. The amount of fees depends on a number of factors including the types of security, length of the loan and credit standing of the borrower. The Funds continue to receive interest or dividends on the securities loaned during the borrowing period. The Funds have the right under the terms of the securities lending agreement to recover the securities from the borrower on demand. U.S. Bancorp Asset Management, Inc. received no income from the Internet Fund for its securities lending administrative services during the year ended August 31, 2013. The Small Cap Growth Fund, Micro Cap Growth Fund and Wisdom Fund did not participate in securities lending during the periods ended August 31, 2013.
As of August 31, 2013, the Internet Fund had loaned securities that were collateralized by cash proceeds that the borrower paid to the Internet Fund. The cash collateral is invested by the custodian with the approval of the Adviser. Although risk is mitigated by the collateral and by an indemnification by the securities lending agent, the Internet Fund could experience a delay in recovering its securities and possible loss of income or value if the borrower fails to return the borrowed securities. The Internet Fund is also exposed to market risk on the investments it purchases with the proceeds of the cash collateral. As of August 31, 2013, the value of the Internet Fund’s securities on loan was $1,422,619. The cost of the related collateral was $630,875 and the fair value of the investments purchased was $145,193 resulting in unrealized depreciation of $485,682 as of August 31, 2013. An amount of $807,291 of the collateral was not invested and held in cash. For the year ended August 31, 2013, the Internet Fund experienced $34,719 of unrealized gains on the investments it purchased with proceeds of the cash collateral.
JACOB FUNDS INC.
NOTES TO THE FINANCIAL STATEMENTS (Continued)
NOTE 8—DISTRIBUTION AND SERVICE PLAN
The Corporation, on behalf of the Internet Fund, has adopted a distribution and service plan (the “Internet Fund Plan”), pursuant to Rule 12b-1 under the 1940 Act. The Internet Fund Plan provides that the Internet Fund will compensate the Adviser 0.25% per annum of the Internet Fund’s average daily net assets for certain expenses and costs incurred in connection with providing shareholder servicing and maintaining shareholder accounts and to compensate parties with which it has written agreements and whose clients own shares of the Internet Fund for providing servicing to their clients (“Shareholder Servicing Fee”). The Internet Fund Plan also provides for a distribution fee equal to 0.10% of the Internet Fund’s average daily net assets on an annual basis (“Asset Based Sales Charge”). The fee is used to compensate Quasar Distributors, LLC, the Funds’ distributor (the “Distributor”), for basic distribution services, out of pocket expenses incurred in connection with activities to sell Internet Fund shares, advertising, compliance reviews, and licensing of the Adviser’s staff. The Distributor may make payments from time to time from the Asset Based Sales Charge to broker-dealers and other financial professionals whose clients are Internet Fund shareholders for providing distribution assistance and promotional support to the Internet Fund. Remaining amounts of the Asset Based Sales Charge may be used to satisfy distribution costs as directed by the Adviser. The Internet Fund incurred $130,695 in expenses pursuant to the 12b-1 Plan for the year ended August 31, 2013.
The Corporation, on behalf of the Small Cap Growth Fund, Micro Cap Growth Fund and Wisdom Fund, has adopted a distribution and service plan (the “Plan”) pursuant to Rule 12b-1 under the 1940 Act. Rule 12b-1 provides that an investment company that bears any direct or indirect expense of distributing its shares must do so only in accordance with the Plan permitted by Rule 12b-1. Pursuant to the Plan, the Small Cap Growth Fund, Micro Cap Growth Fund and Wisdom Fund make payments to the Distributor, the Adviser, financial intermediaries or others to reimburse such parties for distribution and/or shareholder servicing activity in an amount not to exceed 0.35% of the average daily net assets on an annual basis. The distribution fees are “asset based” sales charges and, therefore, long-term shareholders may pay more in total sales charges than the economic equivalent of the maximum front-end sales charge permitted by the Financial Industry Regulatory Authority (FINRA). The Small Cap Growth Fund incurred $23,011, the Micro Cap Growth Fund incurred $10,069 and the Wisdom Fund incurred $37,919 in expenses pursuant to the 12b-1 Plan for the periods ended August 31, 2013.
NOTE 9—FUND REORGANIZATION
On November 9, 2012 the shareholders of the Predecessor Small Cap Growth Fund and Predecessor Micro Cap Growth Fund (the “Predecessor Funds”) approved an Agreement and Plan of Reorganization (“Reorganization Plan”), which qualified as a tax-free exchange for federal income tax purposes, providing for the transfer of assets and the assumption of liabilities of the Predecessor Funds to the Small Cap Growth Fund and Micro Cap Growth Fund, respectively (the “Funds”). The Micro Cap Growth Fund was a newly created series of the Corporation. The Reorganization Plan provided for the acquisition by the Funds of all of the assets of the Predecessor Funds in exchange solely for the assumption of all of the liabilities of the Predecessor Funds and the issuance of shares of the Funds distributed pro rata by the Predecessor Funds to its shareholders in complete liquidation and termination of the Predecessor Funds. The Micro Cap Growth Fund adopted all of the history of the Predecessor Micro Cap Growth Fund. Class I and Class R shares of the Predecessor Funds were reorganized into Institutional Class and Investor Class shares of the Funds, respectively. Pursuant to the Reorganization Plan, each shareholder of the Predecessor Funds received shares of the Funds equal in value to the shares the shareholder had immediately prior to the Reorganization. On November 12,
JACOB FUNDS INC.
NOTES TO THE FINANCIAL STATEMENTS (Continued)
2012, the reorganization was completed and the Predecessor Small Cap Growth Fund and Predecessor Micro Cap Growth Fund had $260,156 and $1,836,644 of unrealized appreciation, respectively, on that date.
The following table illustrates the details of the reorganization of the Small Cap Growth Fund:
|
|
|
Shares
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Predecessor
|
|
Predecessor
|
|
|
Issued to
|
|
|
|
|
|
Small Cap
|
|
|
|
|
|
|
|
|
|
|
Small Cap
|
|
Small Cap
|
|
|
Shareholders
|
|
|
Small Cap
|
|
|
Small Cap
|
|
Growth
|
|
|
|
|
|
|
|
|
Growth
|
|
Growth
|
|
|
of Predecessor
|
|
|
Growth
|
|
|
Growth
|
|
Fund
|
|
|
|
|
Tax
|
|
|
|
Fund
|
|
Fund
|
|
|
Small Cap
|
|
|
Fund
|
|
|
Fund
|
|
Share
|
|
Combined
|
|
|
Combined
|
|
Status of
|
|
Share Class
|
|
Net Assets
|
|
|
Growth Fund
|
|
|
Net Assets
|
|
|
Shares
|
|
Class
|
|
Net Assets
|
|
|
Shares
|
|
Transfer
|
|
Class I
|
|
$
|
8,828,597
|
|
|
|
682,698
|
|
|
$
|
—
|
|
|
|
—
|
|
Institutional
|
|
$
|
8,828,597
|
|
|
|
682,698
|
|
Non-taxable
|
|
Class R
|
|
|
1,900,692
|
|
|
|
146,977
|
|
|
|
4,783,565
|
|
|
|
369,904
|
|
Investor
|
|
|
6,684,257
|
|
|
|
516,881
|
|
Non-taxable
|
|
Total
|
|
$
|
10,729,289
|
|
|
|
829,675
|
|
|
$
|
4,783,565
|
|
|
|
369,904
|
|
|
|
$
|
15,512,854
|
|
|
|
1,199,579
|
|
|
The components of net assets immediately before the acquisition were as follows:
|
|
|
|
|
|
Distributions in
|
|
|
Accumulated Net
|
|
|
Net Unrealized
|
|
|
|
|
|
|
|
|
|
|
Excess of Net
|
|
|
Realized Loss
|
|
|
Appreciation/
|
|
|
|
|
|
|
|
Capital Stock
|
|
|
Investment Income
|
|
|
|
|
|
Depreciation
|
|
|
Net Assets
|
|
|
Small Cap Growth Fund II
|
|
$
|
20,453,928
|
|
|
$
|
(179,199
|
)
|
|
$
|
(9,805,596
|
)
|
|
$
|
260,156
|
|
|
$
|
10,729,289
|
|
|
Small Cap Growth Fund
|
|
|
19,659,332
|
|
|
|
(427,728
|
)
|
|
|
(14,650,238
|
)
|
|
|
202,199
|
|
|
|
4,783,565
|
|
|
Total
|
|
$
|
40,113,260
|
|
|
$
|
(606,927
|
)
|
|
$
|
(24,455,834
|
)
|
|
$
|
462,355
|
|
|
$
|
15,512,854
|
|
* Due to rules under section 381 and 382 of the Internal Revenue Code, the combined fund will only be able to utilize $9,228,837 of the $22,868,661 capital loss carryforward and the losses will be limited to $136,875 each year ($109,500 in the first short year) over the next 5 years. The combined fund may not utilize the remaining $13,639,824.
Assuming the acquisition of Jacob Small Cap Growth Fund II had been completed on September 1, 2012, the combined Funds’ pro forma results in the Statement of Operations during the fiscal year ended August 31, 2013 were as follows:
|
Net investment income (loss)
|
|
$
|
(465,215
|
)*
|
|
Net realized and unrealized gain on investments
|
|
$
|
5,502,817
|
**
|
|
Net increase in net assets resulting from operations
|
|
$
|
5,037,602
|
|
* $(286,016) as reported in the Jacob Small Cap Growth Fund Statement of Operations, plus $(179,199) Jacob Small Cap Growth Fund II pre-merger.
** $4,884,135 as reported in the Jacob Small Cap Growth Fund Statement of Operations plus $618,682 Jacob Small Cap Growth Fund II pre-merger.
Because the combined funds have been managed as a single integrated Fund since the acquisition was completed, it is not practicable to separate the amounts of income and expenses of Jacob Small Cap Growth Fund II that have been included in the Fund’s Statement of Operations since November 9, 2012.
JACOB FUNDS INC.
NOTES TO THE FINANCIAL STATEMENTS (Continued)
The following table illustrates the details of the reorganization of the Micro Cap Growth Fund:
|
|
|
|
|
|
Shares
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issued to
|
|
|
|
|
|
|
|
|
|
|
Predecessor
|
|
Predecessor
|
|
|
Shareholders
|
|
|
|
|
|
|
|
|
|
|
Micro Cap
|
|
Micro Cap
|
|
|
of Predecessor
|
|
|
Micro Cap
|
|
Micro Cap
|
|
|
|
Tax
|
|
Growth Fund
|
|
Growth Fund
|
|
|
Micro Cap
|
|
|
Growth Fund
|
|
Growth Fund
|
|
Combined
|
|
Status of
|
|
Share Class
|
|
Net Assets
|
|
|
Growth Fund
|
|
|
Net Assets
|
|
Share Class
|
|
Net Assets
|
|
Transfer
|
|
Class I
|
|
$
|
41,722,139
|
|
|
|
2,225,058
|
|
|
$
|
—
|
|
Institutional
|
|
$
|
41,722,139
|
|
Non-taxable
|
|
Class R
|
|
|
4,353,097
|
|
|
|
239,629
|
|
|
|
—
|
|
Investor
|
|
|
4,353,097
|
|
Non-taxable
|
|
Total
|
|
$
|
46,075,236
|
|
|
|
2,464,687
|
|
|
$
|
—
|
|
|
|
$
|
46,075,236
|
|
|
NOTE 10—NEW ACCOUNTING PRONOUNCEMENTS
In December 2011, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2011-11 “Disclosures about Offsetting Assets and Liabilities.” ASU No. 2011-11 requires disclosures to make financial statements that are prepared under U.S. GAAP more comparable to those prepared under IFRS. The new disclosure requirements mandate that entities disclose both gross and net information about instruments and transactions eligible for offset in the Statement of Assets and Liabilities as well as instruments and transactions subject to an agreement similar to a master netting arrangement. In addition, ASU No. 2011-11 requires disclosure of collateral received and posted in connection with netting agreements or similar arrangements. New disclosures are required for annual reporting periods beginning on or after January 1, 2013 and interim periods within those annual periods.
In January 2013, the FASB issued ASU No. 2013-01 “Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities.” ASU No. 2013-01 clarifies that ordinary trade receivables and payables are not included in the scope of ASU No. 2011-11. ASU No. 2011-11 applies only to derivatives, repurchase agreements and reverse repurchase agreements, and securities borrowing and lending that are offset in accordance with specific criteria contained in the FASB Accounting Standards Codification.
Management is currently evaluating the impact ASU No. 2011-11 and ASU No. 2013-01 will have on the Funds’ financial statements and disclosures.
NOTE 11—SUBSEQUENT EVENTS
In preparing these financial statements, the Corporation has evaluated events after August 31, 2013 and determined that there were no significant subsequent events that would require adjustment to or additional disclosure in these financial statements.
JACOB FUNDS INC.
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors of Jacob Funds Inc.
and the Shareholders of the Jacob Internet Fund, Jacob Small Cap Growth Fund,
Jacob Micro Cap Growth Fund and Jacob Wisdom Fund
We have audited the accompanying statements of assets and liabilities of the Jacob Internet Fund, Jacob Small Cap Growth Fund, and Jacob Wisdom Fund, each a series of shares of Jacob Funds Inc. (the “
Funds
”), including the schedules of investments, as of August 31, 2013, and the related statements 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 for each of the three years and the period presented in the period then ended and each of the respective years or periods ended August 31, 2010. Additionally, we have audited the financial highlights of the Jacob Wisdom Fund for the year ended May 31, 2009. 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. The financial statements and financial highlights for all of the remaining years or periods presented were audited by other auditors, whose reports dated July 30, 2010, November 23, 2009, and October 28, 2009 each expressed an unqualified opinion on such financial statements and financial highlights.
We have also audited the accompanying statement of assets and liabilities of Jacob Micro Cap Growth Fund, a series of shares of Jacob Funds, Inc., including the schedule of investments, as of August 31, 2013, and the related statements of operations and changes in net assets and the financial highlights for the period then ended and for the year ended November 30, 2012. These financial statements and financial highlights are the responsibility of the Jacob Micro Cap Growth Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. The statement of changes in net assets for the year ended November 30, 2011 and the financial highlights for each of the years in the four-year period ended November 30, 2011, were audited by other auditors whose report, dated January 27, 2012, expressed an unqualified opinion on such financial statements and financial highlights.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements 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, 2013, by correspondence with the custodian and brokers. 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 Jacob Internet Fund, Jacob Small Cap Growth Fund and Jacob Wisdom Fund as of August 31, 2013, 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 for each of the three years and the period presented in the period then ended and each of the respective years or periods ending August 31, 2010, and also the financial highlights of the Jacob Wisdom Fund for the year ended May 31, 2009, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, the financial statements and financial highlights referred to above for Jacob Micro Cap Growth Fund present fairly, in all material respects, the financial position of Jacob Micro Cap Growth Fund as of August 31, 2013, the results of its operations, changes in its net assets and its financial highlights for the period then ended and for the year ended November 30, 2012, in conformity with accounting principles generally accepted in the United States of America.
|
|
|
|
|
|
|
|
BBD, LLP
|
Philadelphia, Pennsylvania
October 30, 2013
JACOB FUNDS INC.
ADDITIONAL INFORMATION ON FUND EXPENSES (Unaudited)
For the Six Months Ended August 31, 2013 for the Internet Fund, Small Cap Growth Fund, Micro Cap Growth Fund and Wisdom Fund
As a shareholder of a mutual fund, you may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, reinvested dividends, or other distributions; redemption fees; and exchange fees; and (2) ongoing costs, including management fees; distribution and/or service (12b-1) fees; and other fund expenses. The Funds do not currently charge sales charges (loads) or exchange fees. The Funds assess a redemption fee of 2% on Investor Class shares sold within 30 days following their purchase date. In addition, you will be assessed fees for outgoing wire transfers, returned checks and stop payment orders. The Funds charge management fees and distribution and/or service (12b-1) fees. The Expense Example is intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other mutual funds. The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (3/1/2013–8/31/2013) for the Internet Fund, Small Cap Growth Fund, Micro Cap Growth Fund and Wisdom Fund.
Actual Expenses
The first line of the table below provides information about account values based on actual returns and actual expenses. Although the Funds charge no sales load, the Funds charge a redemption fee of 2% on shares sold within 30 days following the purchase date. In addition, you will be assessed fees for outgoing wire transfers, returned checks and stop payment orders at prevailing rates charged by U.S. Bancorp Fund Services, LLC, the Funds’ transfer agent. If you request that a redemption be made by wire transfer, currently the Funds’ transfer agent charges a $15.00 fee. The Example does not reflect transactional costs, such as redemption fees. You may use the information in the first line below, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During the Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line of the table below provides information about hypothetical account values based on a hypothetical return and hypothetical expenses based on a Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not a Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Funds and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect transactional costs, such as redemption fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if the transactional costs were included, your costs would have been higher.
JACOB FUNDS INC.
ADDITIONAL INFORMATION ON FUND EXPENSES (Unaudited) (Continued)
Internet Fund – Investor Class
|
|
|
Expenses Paid
|
|
|
|
Beginning Account
|
Ending Account
|
During the Period
|
|
|
Value 3/1/13
|
Value 8/31/13
|
3/1/13–8/31/13*
|
|
Actual
|
$1,000.00
|
$1,237.00
|
$14.60
|
|
Hypothetical (5% annual return before expenses)
|
$1,000.00
|
$ 999.65
|
$13.05
|
|
____________
|
|
|
|
* Expenses are equal to the Internet Fund’s annualized expense ratio of 2.59% multiplied by the average account value over the period multiplied by 184/365 (to reflect the one-half year period).
Small Cap Growth Fund – Institutional Class
|
|
|
|
Expenses Paid
|
|
|
Beginning Account
|
Ending Account
|
During the Period
|
|
|
Value 3/1/13
|
Value 8/31/13
|
3/1/13–8/31/13*
|
|
Actual
|
$1,000.00
|
$1,243.50
|
$11.03
|
|
Hypothetical (5% annual return before expenses)
|
$1,000.00
|
$1,002.88
|
$ 9.84
|
|
____________
|
|
|
|
* Expenses are equal to the Institutional Class’s annualized expense ratio of 1.95% multiplied by the average account value over the period multiplied by 184/365 (to reflect the one-half year period).
Small Cap Growth Fund – Investor Class
|
|
|
|
Expenses Paid
|
|
|
Beginning Account
|
Ending Account
|
During the Period
|
|
|
Value 3/1/13
|
Value 8/31/13
|
3/1/13–8/31/13*
|
|
Actual
|
$1,000.00
|
$1,241.50
|
$12.71
|
|
Hypothetical (5% annual return before expenses)
|
$1,000.00
|
$1,001.36
|
$
11.35
|
|
____________
|
|
|
|
* Expenses are equal to the Investor Class’s annualized expense ratio of 2.25% multiplied by the average account value over the period multiplied by 184/365 (to reflect the one-half year period).
Micro Cap Growth Fund – Institutional Class
|
|
|
|
Expenses Paid
|
|
|
Beginning Account
|
Ending Account
|
During the Period
|
|
|
Value 3/1/13
|
Value 8/31/13
|
3/1/13–8/31/13*
|
|
Actual
|
$1,000.00
|
$1,248.60
|
$14.40
|
|
Hypothetical (5% annual return before expenses)
|
$1,000.00
|
$ 999.90
|
$12.80
|
|
____________
|
|
|
|
* Expenses are equal to the Institutional Class’s annualized expense ratio of 2.54% multiplied by the average account value over the period multiplied by 184/365 (to reflect the one-half year period).
JACOB FUNDS INC.
ADDITIONAL INFORMATION ON FUND EXPENSES (Unaudited) (Continued)
Micro Cap Growth Fund – Investor Class
|
|
|
|
Expenses Paid
|
|
|
Beginning Account
|
Ending Account
|
During the Period
|
|
|
Value 3/1/13
|
Value 8/31/13
|
3/1/13–8/31/13*
|
|
Actual
|
$1,000.00
|
$1,247.80
|
$15.64
|
|
Hypothetical (5% annual return before expenses)
|
$1,000.00
|
$ 998.79
|
$13.91
|
|
____________
|
|
|
|
* Expenses are equal to the Investor Class’s annualized expense ratio of 2.76% multiplied by the average account value over the period multiplied by 184/365 (to reflect the one-half year period).
Wisdom Fund – Investor Class
|
|
|
|
Expenses Paid
|
|
|
Beginning Account
|
Ending Account
|
During the Period
|
|
|
Value 3/1/13
|
Value 8/31/13
|
3/1/13–8/31/13*
|
|
Actual
|
$1,000.00
|
$1,033.10
|
$9.07
|
|
Hypothetical (5% annual return before expenses)
|
$1,000.00
|
$1,003.78
|
$8.94
|
|
____________
|
|
|
|
* Expenses are equal to the Wisdom Fund’s annualized expense ratio of 1.77% multiplied by the average account value over the period multiplied by 184/365 (to reflect the one-half year period).
JACOB FUNDS INC.
ADDITIONAL INFORMATION (Unaudited)
PROXY VOTING
A description of the policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available without charge by calling toll-free 1-888-JACOB-FX (522-6239) or on the SEC website at http://www.sec.gov.
PROXY VOTING RECORD
Information regarding how the Funds voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available without charge by calling 1-888-JACOB-FX (522-6239) or on the SEC website at http://www.sec.gov.
HOLDINGS DISCLOSURE
The Funds’ Semi-Annual and Annual Reports include a complete schedule of portfolio holdings for the second and fourth quarters of each fiscal year.
The Funds file their complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The Funds’ Forms N-Q are available on the SEC website at http://www.sec.gov and may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.
ADDITIONAL TAX INFORMATION (UNAUDITED
)
For the period ended August 31, 2013, certain dividends paid by the Funds may be subject to a maximum tax rate of 18%. The percentage of dividends declared from net investment income designated as qualified dividend income is as follows:
For corporate shareholders, the percent of ordinary income distributions qualifying for the corporate dividends received deduction for the period ended August 31, 2013 is as follows:
JACOB FUNDS INC.
ADDITIONAL INFORMATION (Unaudited) (Continued)
INFORMATION ABOUT DIRECTORS
The business and affairs of the Funds are managed under the direction of the Corporation’s Board of Directors. Information pertaining to the Directors of the Corporation is set forth below. The Statement of Additional Information includes additional information about the Corporation’s Directors and Officers and is available, without charge, upon request by calling toll-free 1-888-JACOB-FX (522-6239).
|
|
|
|
|
Number of
|
|
|
|
|
Term of
|
|
Portfolios
|
|
|
|
Position(s)
|
Office &
|
|
|
Other
|
|
|
Held
|
Length
|
|
|
Directorships
|
|
|
within the
|
of Time
|
Principal Occupation
|
Overseen
|
Held by
|
|
Name, Address and Age
|
Corporation
|
Served
(1)
|
During Past Five Years
|
by Director
|
Director
|
|
|
|
|
|
|
|
|
Independent Directors:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
William B. Fell
|
Director
|
Since
|
Chief Financial Officer, Rhoads
|
4
|
None
|
|
653 Manhattan Beach Blvd. #J
|
|
1999
|
Industries, Inc., since 2012;
|
|
|
|
Manhattan Beach, CA 90266
|
|
|
Accounting and Financial
|
|
|
|
Age: 44
|
|
|
Consultant, 2010–2012;
|
|
|
|
|
|
|
Controller, ABB Inc.,
|
|
|
|
|
|
|
Instrumentation Division,
|
|
|
|
|
|
|
2009–2010; General Accounting
|
|
|
|
|
|
|
Manager, ABB Inc.,
|
|
|
|
|
|
|
Instrumentation Division,
|
|
|
|
|
|
|
February 2004–September 2009.
|
|
|
|
|
|
|
|
|
|
|
Christopher V. Hajinian
|
Director
|
Since
|
Media Production, since 2011;
|
4
|
None
|
|
653 Manhattan Beach Blvd. #J
|
|
|
Property Management, since
|
|
|
|
Manhattan Beach, CA 90266
|
|
|
2008; Attorney, Neil A. Morris
|
|
|
|
Age: 44
|
|
|
Associates, P.C., 2006–2007.
|
|
|
|
|
|
|
|
|
|
|
Jeffrey I. Schwarzschild
|
Director
|
Since
|
Chief Counsel, California
|
4
|
None
|
|
653 Manhattan Beach Blvd. #J
|
|
|
Conservation Corps, since
|
|
|
|
Manhattan Beach, CA 90266
|
|
|
September 2011; Deputy
|
|
|
|
Age: 42
|
|
|
Attorney General, The State
|
|
|
|
|
|
|
of California, October 2006–
|
|
|
|
|
|
|
September 2011; Associate
|
|
|
|
|
|
|
attorney, Law Office of Mark E.
|
|
|
|
|
|
|
Merin, April 2003–September 2006.
|
|
|
|
Interested Director:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ryan I. Jacob
(2)
|
Director,
|
Since
|
Chairman and Chief Executive
|
4
|
None
|
|
653 Manhattan Beach Blvd. #J
|
President,
|
1999
|
Officer of the Adviser since 1999;
|
|
|
|
Manhattan Beach, CA 90266
|
Chairman of
|
|
Chief Portfolio Manager of The
|
|
|
|
Age: 44
|
the Board
|
|
Internet Fund, Inc. from
|
|
|
|
|
and Chief
|
|
December 1997–June 1999;
|
|
|
|
|
Executive
|
|
Analyst for Horizon Asset
|
|
|
|
|
Officer
|
|
Management, 1994–August 1998.
|
|
|
(continued on next page)
JACOB FUNDS INC.
ADDITIONAL INFORMATION (Unaudited) (Continued)
(continued from previous page)
|
|
|
Term of
|
|
|
|
Position(s)
|
Office &
|
|
|
|
Held
|
Length
|
|
|
|
within the
|
of Time
|
Principal Occupation
|
|
Name, Address and Age
|
Corporation
|
Served
(1)
|
During Past Five Years
|
|
|
|
|
|
|
Officers:
|
|
|
|
|
|
|
|
|
|
Francis J. Alexander
(3)
|
Vice
|
Since
|
Member of the Adviser and portfolio manager of the
|
|
653 Manhattan Beach Blvd. #J
|
President,
|
1999
|
Internet Fund since inception in 1999, Director of the
|
|
Manhattan Beach, CA 90266
|
Secretary and
|
|
Internet Fund, 1999–October 2003; President,
|
|
Age: 69
|
Treasurer
|
|
Alexander Capital Management, Inc., March
|
|
|
|
|
1985–present; Managing Member, ACMG, LLC
|
|
|
|
|
(registered investment adviser), October 1999 to
|
|
|
|
|
December 2003; Director and portfolio manager,
|
|
|
|
|
1998–March 2002, chairman of investment committee,
|
|
|
|
|
March 1999–March 2002, Lepereq, de Neuflize & Co.
|
|
|
|
|
Inc. (financial services company in investment advisory
|
|
|
|
|
and broker/dealer business).
|
|
|
|
|
|
|
Shane Morris
(3)
|
Chief
|
2004–
|
Operations Manager for the Adviser since July 2008;
|
|
653 Manhattan Beach Blvd. #J
|
Compliance
|
2007
|
Operations Manager for the Adviser,
|
|
Manhattan Beach, CA 90266
|
Officer and
|
and
|
February 2002–October 2007.
|
|
Age: 36
|
Anti-Money
|
since
|
|
|
|
|
July
|
|
|
|
|
2008
|
|
|
|
Officer
|
|
|
__________
|
(1)
|
Each Director holds office during the lifetime of the Funds, until his termination, or until the election and qualification of his successor.
|
|
(2)
|
Ryan I. Jacob is deemed to be an “interested person” of the Funds (as defined in the 1940 Act) because of his affiliation with the Adviser.
|
|
(3)
|
Francis J. Alexander and Shane Morris are related to each other as stepfather and stepson, respectively.
|
Investment Adviser
Jacob Asset Management of New York LLC
Administrator and Transfer Agent
and Dividend Agent
U.S. Bancorp Fund Services, LLC
Underwriter and Distributor
Quasar Distributors, LLC
Custodian
U.S. Bank, N.A.
Legal Counsel
Stradley Ronon Stevens & Young, LLP
Independent Registered Public
Accounting Firm
BBD, LLP
This report has been prepared for the information of shareholders of the Jacob Internet Fund, the Jacob Small Cap Growth Fund, the Jacob Micro Cap Growth Fund and the Jacob Wisdom Fund and is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus that includes information regarding the Funds’ objectives, policies, management, records and other information.
Jacob Asset Management of New York LLC
1-888-JACOB-FX (522-6239)
www.jacobmutualfunds.com