State of West Virginia Office of the State Treasurer. West Virginia College Prepaid Tuition and Savings Program

Transcription

1 State of West Virginia Office of the State Treasurer West Virginia College Prepaid Tuition and Savings Program A Program of the State of West Virginia For the Fiscal Year Ended June 30, 2006 John D. Perdue State Treasurer Charles H. Bockway Deputy Treasurer West Virginia College Prepaid Tuition and Savings Program David S. Thomas, CPA Financial Director West Virginia College Prepaid Tuition and Savings Program Prepared by the Office of the Financial Director

2 The mission of the Prepaid College Plan is to offer a simple, convenient, safe and efficient college savings program that will: Make a college education more accessible and affordable to more West Virginians Encourage more families to save ahead for the costs of college Promote attendance at West Virginia s public and private institutions of higher learning Establish college attendance as the norm for more of West Virginia s youth Express the quality, user-friendliness, professionalism and innovation inherent in the Treasurer s Office.

3 State of West Virginia OFFICE OF THE STATE TREASURER CHARLESTON, WV John D. Perdue State Treasurer Jerry Simpson Assistant State Treasurer The Honorable Members of the Legislature The Members of the Board of Trustees of the West Virginia College Prepaid Tuition and Savings Program The Prepaid Tuition Plan Contract Holders The Savings Plan Participants Citizens of West Virginia: I am pleased to provide you with the (CAFR) of the West Virginia College Prepaid Tuition and Savings Program for the year ended June 30, The financial statements contained herein have been audited by an independent certified public accounting firm. The CAFR exemplifies the Office of the State Treasurer s commitment to financial accountability and adheres to nationally recognized standards. The Program is committed to providing a safe and secure means for making college costs affordable. The CAFR is designed to provide the reader with clear, concise and complete financial data. This report is made possible through the efforts of many people throughout the Treasurer s Office dedicated to providing reliable and credible financial information in conformity with accounting principles generally accepted in the United States. Their commitment and dedication to national reporting standards have resulted in the Program s achievement of a high level of financial accountability. Sincerely, John D. Perdue

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5 West Virginia College Prepaid Tuition and Savings Program For the Fiscal Year Ended June 30, 2006 Table of Contents Introductory Section Letter of Transmittal... 9 Certificate of Achievement for Excellence in Financial Reporting Organizational Chart Principal Officials Financial Section Independent Auditors Report Management s Discussion and Analysis Basic Financial Statements: Enterprise Funds: Statement of Net Assets Statement of Revenues, Expenses and Changes in Net Assets Statement of Cash Flows Fiduciary Fund: Statement of Fiduciary Net Assets Statement of Changes in Fiduciary Net Assets Notes to Financial Statements Supplemental Information: Statements of Fiduciary Net Assets Savings Plan Trust Fund Statements of Changes in Fiduciary Net Assets Savings Plan Trust Fund Schedules of s Savings Plan Trust Fund Financial Highlights Savings Plan Trust Fund Statistical Section Table 1 Revenues and Expenses, Enterprise Funds Table 2 Additions and Deductions, Fiduciary Fund Table 3 Types of Prepaid Tuition Plan Contracts (Continued on next page) - 5 -

6 Table of Contents (Continued) Table 4 Prepaid Tuition Plan Beneficiaries Table 5 Prepaid Tuition Plan Students Table 6 Tuition and Mandatory Fees Table 7 Resident Full-time Undergraduate Enrollment Table 8 Savings Plan Beneficiaries Table 9 Savings Plan Options Table 10 Savings Plan Top Ten Firms Table 11 Savings Plan Top Ten States

7 Introductory Section Letter of Transmittal Certificate of Achievement for Excellence in Financial Reporting Organizational Chart Principal Officials - 7 -

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9 November 10, 2006 Honorable John D. Perdue, State Treasurer Office of the State Treasurer Honorable Members of the West Virginia Legislature Board of Trustees West Virginia College Prepaid Tuition and Savings Program Contract Holders of the Prepaid Tuition Plan Participants in the Savings Plan Citizens of West Virginia Ladies and Gentlemen: The ( CAFR ) of the West Virginia College Prepaid Tuition and Savings Program (the Program ) for the year ended June 30, 2006, is hereby respectfully submitted. This report was prepared by the Office of the Financial Director of the Program. Responsibility for both the accuracy of the presented data and the completeness and fairness of the presentation, including all disclosures, rests with management of the Program. We believe the information, as presented, is accurate in all material respects, and that it is presented in a manner designed to fairly set forth the financial position of the enterprise funds and fiduciary fund of the Program and the respective changes in financial position and cash flows where applicable. All disclosures necessary to enable the reader to gain an understanding of the Program s financial activities have been included. Management is responsible for establishing and maintaining internal control designed to ensure that the assets of the Program are protected from loss, theft or misuse and that the preparation of the financial statements is in conformity with accounting principles generally accepted in the United States. Internal control is designed to provide reasonable, but not absolute, assurance that these objectives are met. The concept of reasonable assurance recognizes that (1) the cost of a control should not exceed the benefits likely to be derived from it, and (2) the valuation of costs John D. Perdue, State Treasurer Office of the State Treasurer 1900 Kanawha Blvd. East, Charleston WV FAX

10 and benefits requires estimates and judgments by management. Management of the Program has established a comprehensive internal control framework that is designed to provide a reasonable basis for making representations concerning the finances of the Program. Because the cost of internal control should not outweigh its benefits, the Program s comprehensive framework of internal control has been designed to provide reasonable rather than absolute assurance that the financial statements will be free from material misstatement. As management, we assert that, to the best of our knowledge and belief, this financial report is complete and reliable in all material respects. Accounting principles generally accepted in the United States of America require that management provide a narrative introduction, overview, and analysis to accompany the basic financial statements in the form of Management s Discussion and Analysis ( MD&A ). This letter of transmittal is designed to complement MD&A and should be read in conjunction with it. The Program s MD&A can be found immediately following the report of the independent auditors in the financial section of this report. The CAFR is presented in three sections: introductory, financial and statistical. The introductory section contains this transmittal letter, which includes discussions of the financial activities and highlights for the fiscal year, a list of the principal officials of the Program, and the Program s organizational chart. The financial section includes the MD&A, basic financial statements, supplemental information, and the independent auditor s opinion on the financial statements. The statistical section, which is unaudited, includes selected financial and statistical data. Actuarial Soundness Review The Program s Prepaid Tuition Plan is required by Chapter 18, Article 30 of the West Virginia Code to have an annual actuarial soundness review performed by a qualified actuary. The firm Actuarial Resources Corporation performed the review as of June 30, The report is available for public distribution and may be obtained from the Program. Audit The Program is required by Chapter 18, Article 30 of the West Virginia Code to have an annual audit by an independent certified public accounting firm. The firm of Deloitte & Touche LLP performed the financial statement audit for the fiscal year ended June 30, 2006, in accordance with auditing standards generally accepted in the United States of America. The auditors report on the Program s financial statements is included in the financial section of this report

11 Profile of the Program The Program operates under the West Virginia State Code Chapter 18, Article 30, West Virginia College Prepaid Tuition and Savings Program Act. This Act was formerly known as the West Virginia Prepaid Tuition Trust Act until amended by the West Virginia Legislature on April 12, The State Treasurer under the direction of the nine-member West Virginia College Prepaid Tuition and Savings Program Board of Trustees (the Board ) administers the Program. The purpose of the Program is to offer a Prepaid Tuition Trust Fund (the Prepaid Tuition Plan ) that provides individuals and organizations the opportunity to prepay tomorrow s college tuition and mandatory fees at West Virginia public and private colleges and universities, and to offer a Savings Plan Trust Fund (the Savings Plan ) that provides a means of saving to pay for the variety of costs of attending college. The Program began operating its Prepaid Tuition Plan in July 1997 with the initial enrollment period commencing on October 1, 1998 and ending January 31, Approximately 9,730 Prepaid Tuition Plan contracts have been sold. The Savings Plan opened in March Nearly 76,000 Savings Plan accounts have been opened since inception through June 30, As discussed in Note 8 in the Notes to Financial Statements, the West Virginia Legislature closed the Prepaid Tuition Plan to new enrollment effective March 8, 2003 until the Legislature authorizes the plan to reopen. Under State Code (g), the Prepaid Tuition Plan will continue in existence and closing the plan to new contracts shall not affect any contracts in effect on March 8, No Prepaid Tuition Plan contracts were sold in the year ended June 30, The Program s Board selected Hartford Life Insurance Company ( Hartford Life ) to provide records administration, cash management, and customer service for both plans, and investment management services for the Savings Plan. Both plans are known collectively as SMART529 The College Savings Solution. The Program is an Internal Revenue Service Section 529 Qualified State Tuition Program. A more detailed description of the Program can be found in Note 1 in the Notes to Financial Statements in the financial section of this CAFR. Revenues of the Prepaid Tuition Plan are recognized primarily from the present value of prepaid tuition contracts and from investment earnings. Expenses of the Prepaid Tuition Plan are for tuition contract benefits and for general and administrative operating activities. Additions to the Savings Plan come primarily from participant contributions and investment earnings; deductions are primarily the result of participant withdrawals and administrative expenses. Sources of revenue for operating the overall Program come from annual appropriations from the West Virginia State Legislature and from fees charged to Program participants. As detailed in Note 2 in the Notes to Financial Statements, the Office of the State Treasurer includes appropriation requests for the Program in the State Treasurer s budgetary schedule that is submitted to the Secretary of the West Virginia Department of Administration each year. The schedule is subject to annual budget review and approval by the West Virginia State Legislature

12 Budgetary control is maintained through legislative appropriation and the Executive Branch quarterly allotment process. Agencies submit budgetary requests to the State Department of Administration, which compiles the Executive Budget on behalf of the Governor, who submits it to the Legislature. After approval of the budget, the Department of Administration maintains control over the spending patterns of the state at the activity level and by use of the quarterly allotments. Annual appropriations are released for spending in quarterly installments or allotments. The State Auditor exercises control over spending at the annual appropriation level. All appropriations, except funds that are re-appropriated, expire 31 days after fiscal year end. All re-appropriated funds are available, in the aggregate, on the first day of the fiscal year. The State s fiscal year is July 1 through June 30. Financial Condition & Other Information College costs continue to rise faster than general inflation as measured by the Consumer Price Index. The Prepaid Tuition Plan s weighted average benefit value for West Virginia public college and university tuition and fees for state residents increased approximately 6.8% from school years to , while the Consumer Price Index has been in the 3% annual increase range. The weighted average benefit value increase was approximately 6.7% from school years to According to The College Board, average tuition and fees for four-year public colleges and universities increased 6.3% nationwide for the school year, and the increase was 4.1% for two-year public institutions. Total costs including tuition, fees, room and board increased 5.6% nationwide for four-year public institutions. The College Board, which administers the Scholastic Aptitude Test (SAT) college entrance exam, is a national nonprofit membership association composed of more than 5,000 schools, colleges, universities, and other educational organizations. In the fall of 2005, approximately 59.3% of West Virginia high school students graduating from a state high school continued their education at an institution of higher education. This was the same rate for The national figures showed a projected college-going rate of 55.4% in 2004, the most current year available, at which time the West Virginia rate was 54.1%. The weighted average tuition for West Virginia public college and university tuition and fees for state residents was $1,951 per semester for the school year, up from $1,827 for the prior year. The actuarially determined tuition contract benefits liability is based on the weighted average tuition, current tuition value, estimated tuition growth, and the expected rate of return on investments. The Program changed its policy regarding the benefit paid to beneficiaries attending in-state private or out-of-state institutions beginning with the school year. The benefit, or current tuition value, had been equal to the weighted average tuition. Current tuition value is now more than weighted average tuition. Current tuition value for the school year was $2,089 (weighted average tuition was $1,951). Tuition is assumed to grow 7% for the school year and each year thereafter. An annual rate of return of 7.25% is assumed on Prepaid Tuition Plan investments. If either or both of those assumptions vary

13 significantly from actual results, the liability will change accordingly as well as the net assets deficiency. For example, if tuition growth for the next year is more than the assumed 7.0%, the tuition contract benefits liability will increase beyond actuarial expectations and the net assets deficiency will increase accordingly. If the rate of return on investments is less than the assumed 7.25%, the liability will increase beyond actuarial expectations as well as the net assets deficiency. In the same manner, if the tuition growth assumption exceeds actual growth or if the rate of return assumption is less than actual returns, the tuition contract benefits liability will decrease below actuarial expectations as well as the net assets deficiency. In summary, if the actual results vary significantly from the assumptions, the deficiency in net assets of the Prepaid Tuition Plan could significantly change. See the MD&A in the financial section of this report for a more detailed discussion about actuarial assumptions. The Prepaid Tuition Plan s investment portfolio had a total gain of 9.1% for the fiscal year ended June 30, 2006, a gain of 10.8% for the prior year and a gain of 15.5% for the year ended June 30, The Prepaid Tuition Plan s investment mix throughout the fiscal year was 60% equity securities and 40% fixed income securities. The fiscal year was a good year for the Prepaid Tuition Plan s equity investments, with domestic stocks returning 11.4% and international stocks returning 26.0%. The Prepaid Tuition Plan s fixed income investments returned 0.1% for the year. Overall, the Prepaid Plan s total portfolio performed slightly better than its investment policy index, which was up 9.0% or 1 percentage point less than the portfolio s 9.1% gain. The Prepaid Tuition Plan has a net assets deficiency also referred to as an actuarial deficit or unfunded liability of more than $5.3 million at June 30, The deficiency was caused primarily by less than expected investment gains in prior years, unexpected tuition increases, changes in prior years of estimates of rates of future investment earnings and tuition growth, and investment losses. The Prepaid Tuition Plan s financial condition is dependent on its investment earnings and adequate cash flows. As discussed in Note 8 in the Notes to the Financial Statements in the financial section of this report, steps have been taken to ensure financial stability, which includes closure of the plan to new enrollment and a pledge of funds from the State to support payment of benefits. Management believes the Prepaid Tuition Plan will have sufficient resources to meet its obligations as they become due. The Program sought and received legislation during the 2006 Regular Session of the West Virginia Legislature to increase the amount of funding available to the Program s Prepaid Tuition Escrow Account from the state s Unclaimed Property Trust Fund. The legislation increased the annual amount available for transfer from $500,000 to $1 million. The Escrow Account provides funding to support the deficit in the Prepaid Tuition Trust Fund, and the annual transfer is triggered by the actuarial unfunded liability at the end of the fiscal year. The Escrow Account is discussed further in Note 8 in the Notes to Financial Statements in the Financial Section of this report. In January 2006, end-of-the year individual account statements summarizing activity through December 31, 2005, were mailed to all Prepaid Tuition Plan and Savings Plan account owners. The West Virginia Prepaid Tuition Plan Disclosure Statement and Participation Agreement was revised effective January 31, 2006, and mailed to all Prepaid Tuition Plan account owners. This

14 document also included a Summary of the Financial Condition of the Prepaid Tuition Trust Fund as of June 30, The Savings Plan s various investment options showed rates of return ranging from a negative 2.7% to a positive 24.7% for the fiscal year, mostly equaling or outperforming their benchmarks. This was the fourth year for the Savings Plan. Contributions to the Savings Plan were 22% more this fiscal year than last year. gains this year in the Savings Plan were $64.1 million. There was a $32.6 million investment gain last fiscal year. On September 2, 2005, a supplement was issued to the Offering Statements for Director SMART529, Leaders SMART529, and Cornerstone SMART529 relating to sales charges on certain purchases. On February 10, 2006, a supplement was issued to the Offering Statement for Leaders SMART529 relating to the merger of the AIM Aggressive Growth Fund into the AIM Constellation Fund.In March 2006, all SMART529 college savings plan Offering Statements were revised and expanded in order to conform with new industry disclosure guidelines adopted by the National Association of State Treasurers and the College Savings Plan Network for Section 529 Offering Materials, and they were mailed to all account owners. Offering statements for Director SMART529, SMART529 Select, and SMART529 WV Direct were revised effective March Offering Statements for Leaders SMART529 and Cornerstone SMART529 were revised effective March 29, Cash Management The West Virginia Management Board, Hartford Life, and the Office of the State Treasurer manage the Prepaid Tuition Plan s cash and cash equivalents. Hartford Life and the Office of the State Treasurer manage the Savings Plan cash and cash equivalents. Certificate of Achievement for Excellence in Financial Reporting The Government Finance Officers Association of the United States and Canada ( GFOA ) awarded a Certificate of Achievement for Excellence in Financial Reporting to the Program for its comprehensive annual financial report for the fiscal year ended June 30, This was the seventh consecutive year that the Program has achieved this prestigious award. In order to be awarded a Certificate of Achievement, a government must publish an easily readable and efficiently organized comprehensive annual financial report. This report must satisfy both generally accepted accounting principles and applicable legal requirements. A Certificate of Achievement is valid for a period of one year only. We believe that our current comprehensive annual financial report continues to meet the Certificate of Achievement Program s requirements, and we are submitting it to the GFOA to determine its eligibility for another certificate

15 Acknowledgments The Program s success would not be possible without the support and leadership of the State Treasurer, the Legislature and the Program s Board of Trustees. Their commitment and dedication to providing an affordable higher education has provided the Program with a blueprint for success. The Program s staff, Hartford Life, and the staff of the Office of the State Treasurer provided diligent and dedicated service in building the Program and establishing it as the national model of achievement that it is today. The preparation of this report was accomplished only through the many hours and long days of work generously given by Program staff and the many hardworking individuals at Hartford Life who are essential for the success of this program. Respectfully, I hereby submit the of the West Virginia College Prepaid Tuition and Savings Program for the year ended June 30, Sincerely, David S. Thomas, CPA Financial Director West Virginia College Prepaid Tuition and Savings Program

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17 West Virginia College Prepaid Tuition and Savings Program Organizational Chart As of June 30, 2005 Citizens State Legislature College Prepaid Tuition and Savings Program Board of Trustees John D. Perdue, Chairman Thais Blatnik Sarah N. Denman Martin J. Gargano Georgette Rashid George Kay Goodwin Peggy C. Hawse Paul Chewning Blair Montgomery Prepaid Tuition Trust Fund Savings Plan Trust Fund State Treasurer John D. Perdue Financial Director, Prepaid Tuition & Savings Program David S. Thomas Deputy Treasurer, Prepaid Tuition & Savings Program Charles H. Bockway Chief Legal Counsel Diana Stout Staff, Prepaid Tuition & Savings Program

18 West Virginia College Prepaid Tuition and Savings Program Principal Official John D. Perdue, State Treasurer Board of Trustees Treasurer John D. Perdue, Chairman Thais Blatnik Appointed by the Governor Sarah N. Denman Representing the West Virginia Higher Education Policy Commission Colleges & Universities Martin J. Gargano Appointed by the Governor Georgette George Appointed by the Governor Kay Goodwin Representing the State Department of Education and the Arts Peggy C. Hawse Appointed by the Governor Paul Chewning Appointed by the Governor to represent West Virginia s independent colleges and universities Blair Montgomery Representing the West Virginia Higher Education Policy Commission Community & Technical Colleges Executive Staff Charles H. Bockway, Deputy Treasurer West Virginia College Prepaid Tuition and Savings Program Diana Stout, Chief Legal Counsel Office of the State Treasurer David S. Thomas, Financial Director West Virginia College Prepaid Tuition and Savings Program

19 Financial Section Independent Auditors Report Management s Discussion and Analysis Basic Financial Statements Supplemental Information

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21 Deloitte & Touche LLP City Place, 32 nd Floor 185 Asylum Street Hartford, CT USA Tel: Fax: INDEPENDENT AUDITORS REPORT To the Board of Trustees West Virginia College Prepaid Tuition and Savings Program Charleston, West Virginia We have audited the accompanying financial statements of the business-type activities of the enterprise funds and the fiduciary fund of the West Virginia College Prepaid Tuition and Savings Program (the Program), as of and for the year ended June 30, 2006, which collectively comprise the Program s basic financial statements as listed in the table of contents. These financial statements are the responsibility of the Program s management. Our responsibility is to express an opinion on the respective financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the respective financial statements are free of material misstatement. An audit includes consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Program s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the respective financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the business-type activities of the enterprise funds and the fiduciary fund of the Program, as of June 30, 2006, and the respective changes in financial position and respective cash flows, thereof for the year then ended in conformity with accounting principles generally accepted in the United States of America. The management s discussion and analysis on pages 23 through 29 is not a required part of the basic financial statements but is supplementary information required by the Governmental Accounting Standards Board. This supplementary information is the responsibility of Program s management. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of measurement and presentation of the supplementary information. However, we did not audit such information and we do not express an opinion on it Member of Deloitte Touche Tohmatsu

22 Our audit was conducted for the purpose of forming an opinion on the Program s respective financial statements that collectively comprise the Program s basic financial statements. The Supplemental Information listed in the table of contents is presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information is the responsibility of Program s management. The Supplemental Information has been subjected to the auditing procedures applied by us in the audit of the basic financial statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole. The Introductory Section and Statistical Section, listed in the foregoing table of contents, have not been subjected to the auditing procedures applied in the audit of the basic financial statements and, accordingly, we express no opinion on them. November 3,

23 West Virginia College Prepaid Tuition and Savings Program Management s Discussion and Analysis June 30, 2006 As management of the West Virginia College Prepaid Tuition and Savings Program (the Program ), we offer readers of the financial statements of the Program this discussion and analysis of the Program s financial performance for the fiscal year ended June 30, We encourage readers to consider the information presented in this section in conjunction with the Program s financial statements, including notes to the financial statements, which follow this section. Financial Highlights Net assets of the Program s enterprise funds increased approximately $1.4 million for the fiscal year ended June 30, The actuarially funded ratio, which is assets divided by liabilities, was 95%. The ratio was 94% for the fiscal year ended June 30, The increase in net assets was a result of strong investment gains for the year and slightly lower than expected growth in tuition and fees for West Virginia public colleges and universities. The investment portfolio of the Program s enterprise funds had a 9.1% rate of return for the fiscal year, which was less than the 10.8% gain for the prior year and the 15.5% gain for the fiscal year ended June 30, The portfolio outperformed its investment policy index performance of 9.0%. Further growth of the enterprise funds net assets was driven by a less than expected increase in the weighted average tuition for the school year. The average had been projected to increase 7.0%, but it increased only 6.8%. Both the projected estimate of tuition growth and the actual growth affect the actuarial estimate of accrued contract benefits liability. Net assets of the Program s fiduciary fund increased more than $211 million for the fiscal year ended June 30, The increase was the result of approximately $149 million in net contributions over redemptions for the year and more than $64 million in net investment earnings. Net assets of the fiduciary fund represent funds held in trust for individual investors, and, as such, are not available to support operations of the Program. Overview of the Financial Statements This report presents the operating results and financial status of the Program, which is composed of two enterprise funds and a fiduciary fund. The enterprise funds are the Prepaid Tuition Trust Fund (the Prepaid Tuition Plan ) and the College Prepaid Tuition and Savings Program Administrative Account (the Administrative Account ). The enterprise funds financial statements are reported using the economic resources measurement focus and the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America ( GAAP ) for governmental entities. The Program s Savings Plan Trust Fund (the Savings Plan ), is a fiduciary fund (private-purpose trust fund) and also is reported using the accrual basis of accounting in accordance with GAAP

24 The State of West Virginia reports the combined Prepaid Tuition Plan and Administrative Account as enterprise funds of the Program and the Savings Plan as a fiduciary fund (privatepurpose trust fund) of the Program in its ( CAFR ). Enterprise fund reporting is used to report the functions of a governmental entity with businesstype activities in which a fee is charged to external users for goods or services. Fiduciary fund reporting is used to account for resources held for the benefit of parties outside the governmental entity, and those resources are not available to support operations of that entity. The Statement of Net Assets presents information on the enterprise funds assets and liabilities, with the difference between the two reported as either net assets or net assets deficit. This statement is categorized into current and non-current assets and liabilities. For purposes of the financial statements, current assets and liabilities are those assets and liabilities with immediate liquidity or which are collectible or becoming due within 12 months of the statement s date. The plan s net assets also represent the actuarially funded level of the plan, and, over time, increases or decreases in net assets may serve as a useful indicator of whether the plan s funded level or financial position is improving or deteriorating. The Statement of Revenues, Expenses and Changes in Net Assets reflects the operating and nonoperating revenues and expenses of the enterprise funds for the operating year. Operating revenues primarily consist of tuition contracts with major sources of operating expenses being tuition contract benefits and expenses and general and administrative expenses. Nonoperating revenues primarily consist of investment earnings/losses and appropriations from the State. The Statement of Cash Flows is presented on the direct method of reporting, which reflects the enterprise funds cash flows from operating, noncapital financing, and investing activities. Cash collections and payments are reflected in this statement to arrive at the net increase or decrease in cash and cash equivalents for the year. The Statement of Fiduciary Net Assets presents information on the fiduciary fund s assets and liabilities, with the difference between the two reported as net assets held in trust for individuals or organizations. The Statement of Changes in Fiduciary Net Assets reports the additions and deductions to the fiduciary fund for the year. Additions are composed of contributions by investors in the Savings Plan and net investment earnings. Deductions represent redemptions by investors and operating expenses of the fund

25 Financial Analysis of the Prepaid Tuition Plan and Administrative Account Net assets. The following are combined, condensed Statements of Net Assets of the enterprise funds, which are the Prepaid Tuition Plan and the Administrative Account, as of June 30, 2006 and Current assets $ 4,668,239 $ 4,092,741 Noncurrent assets 98,524,106 95,492,708 Total assets 103,192,345 99,585,449 Current liabilities 7,911,630 7,057,608 Noncurrent liabilities 100,540,440 99,176,088 Total liabilities 108,452, ,233,696 Net assets (deficit): Restricted 464, ,403 Unrestricted (5,724,460) (6,797,650) Total net assets (deficit) $ (5,259,725) $ (6,648,247) The net assets deficit decreased nearly 21%, or $1,388,522. Net assets are the excess of total assets over total liabilities, and a net assets deficit occurs when liabilities exceed assets. The actuarially funded status (assets divided by liabilities) of the Prepaid Tuition Plan at June 30, 2006 and 2005, was 95% and 94%, respectively. The actuarially funded status represents the Prepaid Tuition Plan s ability to fund payment of its liabilities as of the date on which the value of the assets and liabilities are measured. Actuarial funding ratios above 100% provide financial support during down times in the economy and lower earnings levels from the Prepaid Tuition Plan s investment portfolio, and during brief periods of unexpectedly high increases in tuition costs. As the funding ratio increases, the funding soundness level increases. The decrease in the net assets deficit and the increase in total assets were the result of investment gains for the year and less than expected growth in tuition and fees at West Virginia public colleges and universities. The Prepaid Tuition Plan s investment portfolio earned a rate of return of 9.1% during the fiscal year ended June 30, 2006, as compared with a 10.8% rate for the prior year. The liability for tuition benefit payments increased less than expected as a result of less than expected increases in the weighted average tuition for the school year. Actuarial estimates of future tuition benefit payments are based partly on weighted average tuition and projected changes in the average. At June 30, 2005, the Prepaid Tuition Plan projected the weighted average tuition to grow at a rate of 7.0% for school year , and each year thereafter. Instead, the actual weighted average tuition grew 6.8% for the school year. The tuition benefit liability also increased as a result of a change in policy regarding the current tuition value paid to beneficiaries attending in-state private or out-of-state institutions beginning with the school year. The current tuition value had been equal to the weighted average tuition. Current tuition value is now more than the weighted average tuition. Current tuition value for the school year is $2,089, whereas weighted average tuition is $1,

26 Additionally, the tuition benefit liability increased because of the interest expense inherent in discounting the liability from several years in the future. The policy change increasing the current tuition value more than offset the less than expected tuition growth, and as a result, the accrued contract benefits liability increased more than expected and thus the net assets deficit did not decrease as much as expected. Changes in net assets. The following are condensed Statements of Revenues, Expenses and Changes in Net Assets of the enterprise funds for the years ended June 30, 2004 and Year Ended June 30, Revenues Operating revenues: Tuition contracts $ 396,794 $ 632,034 Savings Plan administrative fee 658, ,906 1,055,785 1,085,940 Nonoperating revenues: earnings 8,018,744 8,703,584 Appropriations from State of West Virginia 150, ,549 8,169,174 8,852,133 Total revenues 9,224,959 9,938,073 Expenses Operating expenses: Tuition contract benefits and expenses 7,342,348 4,296,239 General and administrative expenses 494, ,527 Total expenses 7,836,437 4,755,766 Increase in net assets 1,388,522 5,182,307 Net assets (deficit) at beginning of period (6,648,247) (11,830,554) Net assets (deficit) at end of period $ (5,259,725) $ (6,648,247) Operating revenues for the Prepaid Tuition Plan reflect the interest effect of discounting future contract payments receivable and include an administrative fee received from the administrators of the Savings Plan and deposited into the Program s Administrative Account. The Administrative Account also includes appropriations from the State, which are recorded as nonoperating revenues. As discussed in Note 8 to these financial statements, during fiscal year 2003 the West Virginia Legislature closed the Prepaid Tuition Plan to new enrollment until the Legislature authorizes the plan to reopen. Because of the closure, no new prepaid tuition contracts were sold during fiscal years 2005 and Nonoperating revenues represent investment earnings and appropriations from the State. earnings for fiscal year 2006 were $8,018,744 and the rate of return was 9.1%. For fiscal year 2005, the rate of return was 10.8%, resulting in an investment gain of $8,703,584 for that year. The Prepaid Tuition Plan s finances are structured such that investment earnings are a key, integral component of total revenues, and when the investment portfolio s performance is less than expected, net assets can

27 decrease significantly. Operating expenses represent prepaid tuition contract benefits and expenses and general and administrative expenses. Prepaid tuition contract benefits and expenses were $7,342,348 and $4,296,239 for the current and past years, respectively. Prepaid tuition contract benefits and expenses are affected by actuarial factors such as the assumed rate of return (7.25%) and tuition growth, which is discussed in the Economic Factors section later in this discussion and analysis. Financial Analysis of the Savings Plan Net assets. The following are condensed Statements of Fiduciary Net Assets of the Savings Plan fiduciary fund as of June 30, 2006 and Assets $ 770,083,116 $ 556,967,382 Liabilities 5,587,505 3,793,691 Net assets $ 764,225,611 $ 553,173,691 Net assets increased 38% or $211,051,920 during the current fiscal year. Net assets are the excess of total assets over total liabilities. Approximately 71% of the increase was attributable to investor activity, which included contributions and redemptions. Nearly all of the remaining 29% of the increase came from net investment earnings of $64,117,712. The Savings Plan began operations in March 2002, and the current fiscal year is the fourth full year of operations. s make up 99% of total assets, and the remaining 1% includes receivables for units and securities sold, dividends receivable, and other assets. Approximately 90% of liabilities consists of payables for securities purchased and units redeemed, and the remaining 10% represents accrued fees and other payables

28 Changes in net assets. The following are condensed Statements of Changes in Fiduciary Net Assets of the Savings Plan fiduciary fund for the years ended June 30, 2006 and Year Ended June 30, 2006 Year Ended June 30, 2005 Additions Contributions $ 213,128,587 $ 174,828,745 Net investment earnings 64,117,712 32,558,876 Total additions 277,246, ,387,621 Deductions Redemptions 63,997,896 20,908,942 Administrative expenses 2,196,483 1,458,537 Total deductions 66,194,379 22,367,479 Increase in net assets 211,051, ,020,142 Net assets at beginning of year 553,173, ,153,549 Net assets at end of year $ 764,225,611 $ 553,173,691 Contributions for the current fiscal year were 22% more than those of the prior year. The various investment portfolios and funds that make up the Savings Plan had rates of return for the current fiscal year ranging from (2.7) % to 24.7%. Administrative expenses for the Savings Plan represent charges related to investment management expenses; sales, marketing and distribution expenses; and other administration expenses. Economic Factors Prepaid Tuition Plan. The actuarial valuation of tuition contracts receivable and accrued contract benefits liability as of June 30, 2006, is based on various actuarial assumptions. Key assumptions include average tuition inflation of 7.0% per school year and an average annual 7.25% rate of return on Prepaid Tuition Plan investments. The weighted average tuition for instate, full-time students increased 6.8% from school years to , and 6.7% from school years to The plan s rate of return on its investments was 9.1% for fiscal year 2006 and 10.8% for Long-term variances in the assumptions can affect the Prepaid Tuition Plan s financial position. Program management together with actuarial and investing consultants and the Program s Board of Trustees (the Board ) review the assumptions annually. Prepaid Tuition Plan management and its advisors believe that the key assumptions, while subject to sudden and unexpected changes in the future, were reasonable for the fiscal years ended June 30, 2006 and As discussed in Note 8 to these financial statements, during fiscal year 2003 the West Virginia Legislature closed the Prepaid Tuition Plan to new enrollment until the Legislature authorizes the plan to reopen. No new contracts were sold in fiscal years 2005 and The Prepaid Tuition Plan will continue in existence and no current contracts will be affected by the closure. It

29 is not known what effect, if any, the closure to new enrollment will have on the financial position of the Prepaid Tuition Plan. Also during fiscal year 2003, as discussed in Note 8 to these financial statements, the Legislature created the Prepaid Tuition Trust Escrow Account to guarantee payment of Prepaid Tuition Plan contracts. As amended by the Legislature in fiscal year 2006, the Escrow Account will receive transfers of up to $1,000,000 from the State Unclaimed Property Trust Fund each year there is an actuarially determined unfunded liability of the Prepaid Tuition Plan. If the Prepaid Tuition Plan is unable to pay current tuition benefits, funds may be withdrawn from the Escrow Account to meet those payments. At June 30, 2006, there was $1,553,340 in the Escrow Account, which consisted of $1,500,000 in total transfers from the Unclaimed Property Trust Fund and net investment gains of $53,340. Because there is an actuarially determined unfunded liability of approximately $5.3 million in the Prepaid Tuition Plan at June 30, 2006, $1,000,000 is expected to be transferred from the Unclaimed Property Trust Fund to the Escrow Account on or before December 15, 2006, in accordance with the provisions enacted by the Legislature. While the Board controls the Escrow Account, funds in the Escrow Account are not assets of either the Prepaid Tuition Plan or the Program and accordingly are not included in the basic financial statements included herein. The State is also offering a PROMISE Scholarship Program ( PROMISE ), which is a meritbased scholarship program in which the State pays tuition and mandatory fees at West Virginia public colleges and universities for qualified students. The State also will pay an equivalent, weighted average amount at private colleges in West Virginia for students qualifying for PROMISE. In cases of scholarships, the Prepaid Tuition Plan provides its beneficiaries with their benefit value to pay for other college expenses. PROMISE awarded its first scholarships for the fall 2002 semester. For the fall 2006 semester, approximately 9,600 students with PROMISE scholarships were enrolled in colleges and universities, of whom about 6,700 were eligible to renew their scholarships from prior years, and about 2,900 were first-time recipients. Management has not determined the impact, if any, that PROMISE will have on the Prepaid Tuition Plan. Savings Plan. As an investment fund, the Savings Plan is subject to the same risks and consequent gains and losses as all publicly and privately offered investment funds. The Savings Plan is directly affected by all factors that affect the economic and investment arenas for both good and bad. Program management continuously monitors activity in the stock market as well as consulting regularly with its various investment advisors and analysts. Requests for Information This financial report is designed to provide a general overview of the Program s finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to Finance Director s Office, West Virginia College Prepaid Tuition and Savings Program, 1900 Kanawha Boulevard East, Charleston WV * * * * * *

30 Enterprise Funds of the West Virginia College Prepaid Tuition and Savings Program Statement of Net Assets June 30, 2006 Prepaid Tuition Trust Fund College Prepaid Tuition and Savings Program Administrative Account Total Enterprise Funds Assets Current assets: Cash and cash equivalents $ 2,504,127 $ 388,831 $ 2,892,958 Due from primary government - 23,019 23,019 Tuition contracts receivable 1,567,704-1,567,704 Other receivables - 184, ,558 Total current assets 4,071, ,408 4,668,239 Noncurrent assets: Tuition contracts receivable 4,896,764-4,896,764 s 93,627,342-93,627,342 Total noncurrent assets 98,524,106-98,524,106 Total assets 102,595, , ,192,345 Liabilities Current liabilities: Accounts payable - 53,410 53,410 Accrued contract benefits liability 7,828,634-7,828,634 Compensated absences - 29,586 29,586 Total current liabilities 7,828,634 82,996 7,911,630 Noncurrent liabilities: Accrued contract benefits liability 100,491, ,491,763 Compensated absences - 48,677 48,677 Total noncurrent liabilities 100,491,763 48, ,540,440 Total liabilities 108,320, , ,452,070 Net assets (deficit): Restricted for payment of general and administrative expenses - 464, ,735 Unrestricted (5,724,460) - (5,724,460) Total net assets (deficit) $ (5,724,460) $ 464,735 $ (5,259,725) The accompanying notes are an integral part of these financial statements

31 Enterprise Funds of the West Virginia College Prepaid Tuition and Savings Program Statement of Revenues, Expenses and Changes in Net Assets For the Year Ended June 30, 2006 Prepaid Tuition Trust Fund College Prepaid Tuition and Savings Program Administrative Account Total Enterprise Funds Operating revenues Tuition contracts $ 396,794 $ - $ 396,794 Savings Plan administrative fee - 658, ,991 Total operating revenues 396, ,991 1,055,785 Operating expenses Tuition contract benefits and expenses 7,342,348-7,342,348 General and administrative expenses - 494, ,089 Total operating expenses 7,342, ,089 7,836,437 Operating (loss) gain (6,945,554) 164,902 (6,780,652) Nonoperating revenues earnings 8,018,744-8,018,744 Appropriations from State of West Virginia - 150, ,430 Total nonoperating revenues 8,018, ,430 8,169,174 Change in net assets 1,073, ,332 1,388,522 Net assets (deficit) at beginning of year (6,797,650) 149,403 (6,648,247) Net assets (deficit) at end of year $ (5,724,460) $ 464,735 $ (5,259,725) The accompanying notes are an integral part of these financial statements

32 Enterprise Funds of the West Virginia College Prepaid Tuition and Savings Program Statement of Cash Flows For the Year Ended June 30, 2006 Prepaid Tuition Trust Fund College Prepaid Tuition and Savings Program Administrative Account Total Enterprise Funds Cash flows from operating activities Cash received from contract purchasers $ 2,352,861 $ - $ 2,352,861 Cash received from Savings Plan administrator - 605, ,057 Tuition benefit payments (5,009,687) - (5,009,687) Payments to employees - (254,673) (254,673) Payments to suppliers - (353,703) (353,703) Net cash used for operating activities (2,656,826) (3,319) (2,660,145) Cash flows from noncapital financing activities Appropriations from the State of West Virginia - 152, ,374 Net cash provided by noncapital financing activities - 152, ,374 Cash flows from investing activities earnings 889, ,232 Purchase of investments (791,471) - (791,471) Proceeds from sale of investments 3,600,000-3,600,000 Net cash provided by investing activities 3,697,761-3,697,761 Net increase in cash and cash equivalents 1,040, ,055 1,189,990 Cash and cash equivalents at beginning of year 1,463, ,776 1,702,968 Cash and cash equivalents at end of year $ 2,504,127 $ 388,831 $ 2,892,958 (Continued on next page) The accompanying notes are an integral part of these financial statements

33 Enterprise Funds of the West Virginia College Prepaid Tuition and Savings Program Statement of Cash Flows (Continued) For the Year Ended June 30, 2006 Prepaid Tuition Trust Fund College Prepaid Tuition and Savings Program Administrative Account Total Enterprise Funds Reconciliation of operating loss to net cash used for operating activities Operating (loss) gain $ (6,945,554) $ 164,902 $ (6,780,652) Adjustments to reconcile operating loss to net cash used for operating activities: Changes in assets and liabilities: Tuition contracts receivable 1,956,067-1,956,067 Other receivables - (53,934) (53,934) Accounts payable - (126,077) (126,077) Tuition contract benefits and expenses 2,332,661-2,332,661 Compensated absences - 11,790 11,790 Net cash used for operating activities $ (2,656,826) $ (3,319) $ (2,660,145) Noncash investing activities Unrealized gain in investments $ 7,129,512 $ - $ 7,129,512 The accompanying notes are an integral part of these financial statements

34 Fiduciary Fund of the West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statement of Fiduciary Net Assets June 30, 2006 Assets s at fair value $ 764,221,788 Receivables for units and securities sold 5,825,747 Dividends receivable 35,541 Other receivables 40 Total assets 770,083,116 Liabilities Payables for units redeemed and securities purchased 5,285,170 Accrued fees 572,335 Total liabilities 5,857,505 Net Assets Net assets held in trust for individuals and organizations 764,225,611 Total net assets $ 764,225,611 The accompanying notes are an integral part of these financial statements

35 Fiduciary Fund of the West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statement of Changes in Fiduciary Net Assets For the Year Ended June 30, 2006 Additions Contributions: Account holders $ 213,128,587 Total contributions 213,128,587 earnings: Net increase in fair value of investments 28,958,762 Dividends and capital gains 38,907,147 Total investment earnings 67,865,909 expense 3,748,197 Net investment earnings 64,117,712 Total additions 277,246,299 Deductions Redemptions: Payments in accordance with trust agreements 63,873,429 Redemptions of deposits to establish new investment funds 124,467 Total redemptions 63,997,896 Administrative expense 2,196,483 Total deductions 66,194,379 Change in net assets held in trust for individuals and organizations 211,051,920 Net assets at beginning of year 553,173,691 Net assets at end of year $ 764,225,611 The accompanying notes are an integral part of these financial statements

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37 West Virginia College Prepaid Tuition and Savings Program Notes to Financial Statements June 30, Organization and Operations The West Virginia College Prepaid Tuition and Savings Program (the Program ) operates under the West Virginia State Code Chapter 18, Article 30, West Virginia College Prepaid Tuition and Savings Act (the Act ). The Act was adopted by the West Virginia State Legislature in The Act was amended April 12, 2001, to continue the Prepaid Tuition Trust Fund (the Prepaid Tuition Plan ) and to enhance and complement the Prepaid Tuition Plan by authorizing the creation of the Savings Plan Trust Fund (the Savings Plan ). The Program is administered by the Office of the State Treasurer on behalf of the Program s nine-member Board of Trustees (the Board ). The purpose of the Program is to provide individuals and organizations the opportunity to prepay future college tuition and mandatory fees at West Virginia public and private colleges and universities and to offer a comprehensive statesponsored college savings plan. Collectively, the Prepaid Tuition Plan and the Savings Plan are marketed as SMART 529 The College Savings Solution. The Board selected Hartford Life Insurance Company ( Hartford Life ) to provide records administration, cash management, and customer service for both the Prepaid Tuition Plan and the Savings Plan. Hartford Life also provides investment management services for the Savings Plan. All funds paid into or invested through the Program in the Prepaid Tuition Plan and the Savings Plan will be available for use at any two- or four-year college or university in the country, with refund and transfer options available. West Virginia state income tax deductions are available to state residents for contributions to the Program. Since the Program is an Internal Revenue Service Section 529 Qualified Tuition Program, earnings on the funds are federally tax deferred until used for college. Additionally, benefits of the Prepaid Tuition and Savings plans are exempt from federal income tax for qualified payouts. This federal tax exemption had been set to expire at the end of calendar year 2010 unless the United States Congress provided an extension. In August 2006, Congress made permanent the federal income tax exemption, which means distributions from Section 529 plans will continue to be tax exempt on and after January 1, Enterprise Funds: Prepaid Tuition Plan and Administrative Account Operations of the Prepaid Tuition Plan began in July 1997 with the initial enrollment period commencing on October 1, 1998, and ending January 31, The Program has sold approximately 9,730 prepaid tuition contracts since inception. As mentioned earlier in this note, the Prepaid Tuition Plan is administered by the Office of the State Treasurer under the direction of the Program s Board. Hartford Life provides records administration, cash management, and customer service for the Prepaid Tuition Plan, and provides investment management services for the Savings Plan

38 Prior to June 30, 2002, prepaid tuition contracts could be purchased in one-year increments of tuition and mandatory fees under three categories: University - College Plan where from one to five years of benefits may be selected; Combination 2 Plus 2 Plan where two years of community college and two years of university - college benefits are purchased; or Community College Plan where one or two years of benefits are purchased at Southern West Virginia Community and Technical College, West Virginia Northern Community College, West Virginia University at Parkersburg, or Eastern West Virginia Community and Technical College. Subsequent to June 30, 2002, prepaid tuition contracts could be purchased in one-semester units of tuition and mandatory fees, and the contracts were no longer categorized by University- College, Combination 2 Plus 2, and Community College plans. One unit of prepaid tuition covers all categories of colleges. All contracts in effect prior to June 30, 2002, were converted to one-semester units. Prices for contracts were based on weighted average tuition benefit value and mandatory fees as determined annually by the Program s consulting actuaries and the Board. Prior to June 30, 2002, purchasers could choose from three payment methods: lump sum, sixtymonth installments, or over an extended period from contract initiation through May of the beneficiary s anticipated high school graduation year. Subsequent to June 30, 2002, the payment methods offered changed to lump sum payments, monthly payments in 12 month increments up to a maximum of 120 months or through May of the beneficiary s anticipated high school graduation year, or a combination of a down payment and monthly payments in 12 month increments. Effective March 8, 2003, the West Virginia Legislature closed the Prepaid Tuition Plan to new contracts until the Legislature authorizes the Prepaid Tuition Plan to reopen. According to State Code ( (g)), closing the Prepaid Tuition Plan to new contracts shall not mean that the Prepaid Tuition Plan is closed and shall not affect any contracts in effect on March 8, All contract holders will continue to pay any amounts due, including monthly installments, penalties and fees, and the Prepaid Tuition Plan will continue to pay all benefits due. No contracts were sold in fiscal year Contract payments of all Prepaid Tuition Plan participants are combined into a single investment fund in order to maximize benefits. The fund is invested in a professionally managed portfolio of stocks, bonds, and other types of investments through the West Virginia Management Board (the IMB ). Under State Code, the investments must be made with the care, skill, and prudence and diligence under the circumstances prevailing that a prudent person acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims. Prepaid Tuition Plan investments shall be diversified to the extent permitted by law so as to minimize the risk of a large loss. Monies from the investment fund are used to pay Prepaid Tuition Plan benefits and expenses

39 In order to participate in the Prepaid Tuition Plan, either the purchaser or the beneficiary must be a West Virginia resident at the time of contract purchase. Also, the beneficiary, at the time of purchase, must be in the ninth grade or lower. When the beneficiary is accepted to an eligible college or university, the contract becomes redeemable. Benefits can be transferred to any fully accredited private or out-of-state college or university within the United States in an amount based on the average cost of tuition and fees then charged by West Virginia public colleges and universities. However, there is no guarantee that the tuition benefit available will cover the actual cost of tuition and fees charged by the private or out-ofstate institution. While the beneficiary has up to ten years after high school to use the Prepaid Tuition Plan benefit, four other options are available: 1) the purchaser may transfer the contract benefits to an eligible substitute beneficiary; 2) at any time four years or more after the beneficiary s expected college entrance date, the purchaser may request a refund of the contract benefit value, less a termination fee and an earnings penalty required by federal law; 3) at any time, the purchaser may cancel the contract and receive a refund of the contract value, less administrative fees and any benefits already paid; or 4) the purchaser may transfer the prepaid contract cancellation value at the time of transfer to the Program s Savings Plan in accordance with state and federal regulations. If the beneficiary is awarded a scholarship for tuition and fees, the benefit value of the contract will be paid in accordance with state and federal regulations. The College Prepaid Tuition and Savings Program Administrative Account (the Administrative Account ) was created by State Code to implement, operate and maintain the Prepaid Tuition and Savings Plans and the overall Program. Sources of funds for the Administrative Account come from fees charged to participants in both the Prepaid Tuition Plan and Savings Plan and from appropriations from the State of West Virginia. Expenses of the Administrative Account cover administrative operations of the overall Program such as wages and benefits, consulting services, and office supplies. The accompanying financial statements report the financial position, results of operations, and cash flows for the fiscal year ended June 30, 2006, of the Program s enterprise funds, which includes the Prepaid Tuition Plan and the Administrative Account. The Program s enterprise funds are enterprise funds of the primary government of the State of West Virginia. Fiduciary Fund: Savings Plan Beginning March 1, 2002, the Savings Plan has been available in conjunction with the Program s Prepaid Tuition Plan. options have been developed in partnership with Hartford Life. As mentioned earlier in this note, the Savings Plan is administered by the Office of the State Treasurer under the direction of the Program s Board. Hartford Life provides records

40 administration, cash management, investment management and customer service for the Savings Plan. The Savings Plan currently is composed of 116 different investment portfolios and individual funds. These financial statements report on the total of all portfolios and individual funds. The Savings Plan is a fiduciary fund (private-purpose trust fund) of the primary government of the State of West Virginia. 2. Significant Accounting Policies Enterprise Funds Basis of Accounting As enterprise funds, the financial statements of the Prepaid Tuition Plan and Administrative Account are presented on the flow of economic resources measurement focus and accrual basis accounting in conformity with accounting principles generally accepted in the United States of America. Under this method of accounting, revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Enterprise funds are used to account for operations that are financed and operated in a manner similar to private business enterprises where the intent is that the costs of providing services to the general public and others on a continuing basis be financed or recovered primarily through user charges. The enterprise funds distinguish operating revenues and expenses from nonoperating. Operating revenues and expenses generally result from providing services in connection with the enterprise funds principal ongoing operations. The principal operating revenues and expenses relate to tuition contract revenues, tuition contract benefits and expenses, and general and administrative expenses. Net investment earnings and appropriations from the State are reported as nonoperating revenues. It is the Program s policy to first apply unrestricted resources when an expense is incurred for purposes for which both restricted and unrestricted net assets are available. As permitted by Governmental Accounting Standards Board ( GASB ) Statement No. 20, Accounting and Financial Reporting for Proprietary Funds and Other Governmental Entities That Use Proprietary Fund Accounting, the Program has elected not to adopt Financial Accounting Standards Board ( FASB ) statements and interpretations issued after November 30, 1989, unless the GASB specifically adopts such FASB statements or interpretations. As a private-purpose trust fund, which is a type of fiduciary fund, assets of the Savings Plan are held in a trustee capacity for individuals and entities invested in the plan, and those assets cannot be used to support the Program. Because the Savings Plan assets are not available to support the Program s operations, the Savings Plan is discussed separately in Note 9 to these financial statements. Assets of the Program s enterprise funds (the Prepaid Tuition Plan and the Administrative Account ) are available to support the Program s operations. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and

41 assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from management s estimates. Budgetary Information The Office of the State Treasurer submits a detailed budgetary schedule of administrative expenses to the Secretary of the West Virginia Department of Administration prior to the beginning of each fiscal year. The budgetary schedule is prepared on the cash basis of accounting. Appropriation requests for the Program are included in the Treasurer s schedule. The budgetary schedule is subject to the annual budget review and approval process of the West Virginia State Legislature. Cash and Cash Equivalents Cash equivalents are short-term investments with maturities when acquired of 90 days or less. Cash and cash equivalents of the enterprise funds principally consist of interest-earning deposits in certain investment pools maintained by the IMB. Such funds are available to the Program with overnight notice. Earnings from these investments are distributed to investment pool participants based on their pro rata participation in the pools. Revenue Recognition The Plan recognizes revenue for tuition contracts in the year the contracts are entered into with the purchaser, with future contract payments being recognized at their present value. The Plan uses a 7.25% discount rate in calculating such present value. The discount rate is based on the anticipated rate of return on investments for the life of the enrollment plan. Contracts receivable are reduced by the annual amounts of contract payments received, and the remaining contracts receivable is recorded at present value. Increases in the present value of the remaining contracts receivable are recognized as revenue in the year of the increase. The Administrative Account records Savings Plan administrative fee revenue from Hartford Life in the period that administrative services are provided. Tuition Contracts Receivable Tuition contracts receivable of the Prepaid Tuition Plan at the balance sheet date represents Program management s best estimate of the present value of future contract payments using a 7.25% discount rate. Accrued Contract Benefits Liability Accrued contract benefits liability of the Prepaid Tuition Plan is recorded at the actuarial present value of future tuition obligations. The valuation method reflects the present value of estimated tuition benefits that will be paid in future years and is adjusted for the effects of projected tuition and fee increases and termination of contracts

42 Compensated Absences, Including Postretirement Benefits Employees fully vest in all earned but unused annual leave to maximum amounts ranging from 240 to 320 hours depending on years of service, and the Program accrues for obligations that may arise in connection with compensated absences for vacation at the current rate of employee pay. In accordance with personnel policies of the State, employees vest in any remaining unused sick leave only upon retirement, at which time any unused compensated absence time either can be converted into employer-paid premiums for post-retirement health care coverage through the West Virginia Public Employees Insurance Agency ( PEIA ), or can be converted into a greater retirement benefit under the State of West Virginia Public Employees Retirement System ( PERS ). The Program accrues for obligations that may arise in connection with compensated absences for unused sick leave that may be converted to employer-paid premiums for postretirement health care coverage. Restricted Assets and Net Assets Restricted assets are subject to constraints imposed by creditors or by law. The Act restricts the Prepaid Tuition Plan s assets to be used specifically for the Prepaid Tuition Plan s obligations; however, the Prepaid Tuition Plan has a deficiency in net assets as of June 30, Accordingly, such deficiency is included in the unrestricted net assets deficit. Assets of the Administrative Account are restricted for the purposes of implementing, operating and maintaining the Program. Federal Income Taxes The Program has been designed to comply with the requirements for treatment as a qualified state tuition program under Section 529 of the Internal Revenue Code. Therefore, no federal income tax provision is required. 3. s and Cash and Cash Equivalents The Program invests its enterprise funds in investment pools maintained by the IMB. The funds are invested in longer-term securities and subject to market fluctuations. s are reported by the IMB at fair value, which is the same as the value of the pool shares, and are accounted for by the Program accordingly, with changes in the fair value included in investment earnings. The earnings from these pooled investments are distributed to investment pool participants based on their pro rata participation in the pools. The following represents a calculation of the net increase in the fair value of investments during the year ended June 30, 2006: Fair value at end of year $ 93,627,342 Less cost of investments purchased during year (791,471) Plus cost of investments redeemed during year 3,600,000 Less fair value at beginning of year (89,306,359) Change in fair value of investments during year $ 7,129,

43 and Deposit Risk Disclosures The Program has adopted an investment policy for the Prepaid Plan that mandates that investments shall be diversified so as to minimize the risk of large losses. Under the investment policy, a long-term focus on investment results as well as prudent diversification across public security markets will be the primary risk control mechanisms. A prudently allocated investment program possesses a significant level of diversification, which results in risk reduction. Diversification is considered in regard to asset classes, geography/country, industry, and maturity. In order to preserve risk control, the Program has adopted a formal review schedule in which investment performance is reviewed at least quarterly, broad asset allocation and withinclass asset allocation are reviewed every three years, and the Program s investment policy is reviewed every year. The investment policy establishes that the Program s enterprise funds are to be allocated 40% to fixed income securities, 42% to U.S. equities, and 18% to international equities. The Program s enterprise funds are invested in the following pools at the IMB. IMB Pool Fair Value of Program s Funds Percent of Total Large Cap Domestic $ 23,535, % Fixed Income 23,646, % Fixed Income Nonqualified 15,126, % Non-Large Cap Domestic 13,736, % International Equity 12,380, % International Nonqualified 5,192, % Short-Term Fixed Income 10, % Total pool assets $ 93,627, % The investment policy does not specifically address custodial credit risk, credit risk, concentration of credit risk, interest rate risk, and foreign currency risk. Custodial Credit Risk The custodial credit risk for investments is the risk that, in the event of the failure of the counterparty to a transaction, the Program will not be able to recover the value of investment or collateral securities that are in the possession of an outside party. The IMB investment pools in which the Program invests its enterprise funds are either not exposed to custodial credit risk or held no securities at June 30, 2006, that were subject to custodial credit risk. Credit Risk Credit risk is the risk that an issuer or other counterparty to an investment will not fulfill its obligations. Neither the IMB nor its investment pools have been rated for credit risk by any

44 organization. The credit risks of the IMB investment pools in which the Program invests its enterprise funds are described as follows. Large Cap Domestic Pool This pool holds equity securities of U.S. companies and money market funds with the highest credit rating. These types of securities are not exposed to credit risk. Non-Large Cap Domestic Pool This pool holds equity securities of U.S. companies and money market funds with the highest credit rating. These types of securities are not exposed to credit risk. International Nonqualified Pool This pool holds an institutional mutual fund that invests in equities denominated in foreign currencies. This pool is not exposed to credit risk. International Equity Pool This pool has both equity securities and cash that are denominated in foreign currencies. This pool is not exposed to credit risk. Fixed Income Nonqualified Pool This pool holds positions in institutional mutual funds that invest in mortgage-backed securities and corporate bonds. The mutual funds are unrated as to credit risk. Short-Term Fixed Income Pool The IMB limits the exposure to credit risk in the Short-Term Fixed Income Pool by requiring all corporate bonds to be rated AA or higher. Commercial paper must be rated A1 by Standard & Poor s and P1 by Moody s. Additionally, the pool must have at least 15% of its assets in United States Treasury issues. The following table provides information on the weighted average credit ratings of the Short-Term Fixed Income pool s investments. The table includes securities received as collateral for repurchase agreements. Security Type Moody s S&P Percent of Pool Assets Agency discount notes P1 A % Agency bonds Aaa AAA 24.8% U.S. Treasury bills Aaa AAA 18.6% Commercial paper P1 A % U.S. Treasury notes Aaa AAA 8.5% Money market funds Aaa AAA 0.1% Total rated investments %

45 Fixed Income Pool The IMB limits the exposure to credit risk in the Fixed Income Pool by requiring all corporate bonds to be rated B or higher at the time of purchase. Convertible bonds must be rated Baa by Standard & Poor s or BBB or higher by Moody s. The following table provides information on the weighted average credit ratings of the Fixed Income pool s asset types. The table includes securities received as collateral for repurchase agreements. Security Type Moody s S&P Percent of Pool Assets Corporate bonds and notes Baa BBB 16.9% U.S. Treasury bonds and notes Aaa AAA 15.1% Corporate asset backed securities Aaa AAA 4.2% U.S. Treasury bill Aaa AAA 1.9% Agency bonds Aaa AAA 1.1% Agency discount notes P1 A-1 0.0% Money market funds Aaa AAA 0.0% Total rated investments 39.2% Unrated securities include commingled investment pools and a Canada Treasury bill. Concentration of Credit Risk Concentration of credit risk is the risk of loss attributed to the magnitude of the Program s investment in a single corporate issuer. None of the IMB pools in which the Program participates held securities of any one issuer in excess of 5% of the value of the pools in accordance with West Virginia statutes. Interest Rate Risk Interest rate risk is the risk that changes in interest rates will adversely affect the fair value of an investment. The following IMB pools in which the Program participates are not exposed to interest rate risk: Large Cap Domestic Pool, Non-Large Cap Domestic Pool, International Nonqualified Pool, and International Equity Pool. The following pools are exposed to interest rate risk. Short-Term Fixed Income Pool The weighted average maturity of the investments in the Short- Term Pool cannot exceed 60 days. The maturity of floating rate notes is assumed to be the next interest rate reset date. The following table provides the weighted average maturities (WAM) for the various asset types in the Short-Term Pool

46 Security Type Carrying Value (In Thousands) WAM (Days) Repurchase agreements $ 223,000 3 U.S. Treasury bills 74, Commercial paper 63, Agency discount notes 32, Agency bonds 2, Money market funds Total pool assets $ 397, Fixed Income Pool The IMB monitors interest rate risk of the Fixed Income Pool by assessing the modified duration of the investments in the pool. The following table provides the weighted average modified duration for the various asset types in the Fixed Income Pool. Security Type Fair Value (In Thousands) Modified Duration (Years) Commingled investment pools $ 1,303, Corporate notes and bonds 363, U.S. Treasury notes and bonds 324, Corporate asset backed securities 90, U.S. Treasury bill 39, Agency bonds 12, Repurchase agreements 10, Canada Treasury bill 2, Agency discount notes 1, Money market fund Total pool assets $ 2,150, The Fixed Income Pool invests in commercial and residential mortgage-backed and asset-backed securities. The cash flows from these securities are based on the payment of the underlying collateral. The modified duration and yield to maturity of these securities are dependent on estimated prepayment assumptions that consider historical experience, market conditions, and other criteria. Actual prepayments may vary with changes in interest rates. Rising interest rates often result in a slower rate of prepayments while declining rates tend to lead to faster prepayments. As a result, the fair values of these securities are highly sensitive to interest rate changes. At June 30, 2006, these securities were approximately 4% of the value of the Fixed Income Pool

47 Fixed Income Nonqualified Pool This pool holds positions in institutional mutual funds that invest in mortgage-backed securities and corporate bonds. The mutual funds are unrated. The weighted average modified duration of the underlying securities is 5.5 years. Foreign Currency Risk Foreign currency risk is the risk that changes in exchange rates will adversely affect the fair value of an investment or a deposit. The following IMB pools in which the Program participates are not exposed to foreign currency risk: Large Cap Domestic Pool, Non-Large Cap Domestic Pool, Short-Term Fixed Income Pool, Fixed Income Pool, and Fixed Income Nonqualified Pool. The following pools are exposed to foreign currency risk. International Nonqualified Pool This pool holds an institutional mutual fund that invests in equities denominated in foreign currencies. This investment, although denominated in U.S. dollars, is exposed to foreign currency risk. International Equity Pool This pool has both equity securities and cash that are denominated in foreign currencies and are exposed to foreign currency risk. The carrying value in the Administrative Account of cash on deposit with the State Treasurer s Office, which approximate estimated fair value, was $388,831 at June 30, The cash is pooled with other deposits from the State s agencies, departments, boards and commissions and is subject to coverage by the Federal Deposit Insurance Corporation (FDIC) or collateralized by securities held by the State or its agents in the State s name. Other cash deposits held in outside bank accounts were $2,504,127. Such deposits are insured by the FDIC or collateralized by the State or its agents in the State s name. Custodial credit risk in regard to deposits is the risk that in the event of the failure of a depository financial institution, a government will not be able to recover deposits or will not be able to recover collateral securities that are in the possession of an outside party. The Program does not have a deposit policy for custodial credit risk. Program management does not believe any of its deposits are exposed to custodial credit risk. 4. Accrued Contract Benefits Liability and Compensated Absences The actuarial present value of accrued contract benefits liability of $108,320,397 as of June 30, 2006, was based on the provision for contract benefits since inception of the Prepaid Tuition Plan. Current liabilities of $7,828,634 represent obligations that will become due within a year from June 30, Noncurrent liabilities of $100,491,763 represent obligations that will become due more than a year after June 30, Under the actuarial evaluation, tuition and fees are assumed to increase an average of 7.0% per year. s are assumed to earn an average rate of return of 7.25% per year

48 The accrued contract benefits liability at June 30, 2006, and changes for the fiscal year then ended are as follows: Beginning balance, June 30, 2005 $ 105,987,736 Interest cost 7,499,790 Actuarial gain (267,219) Contract cancellations and miscellaneous (726,596) Change in definition of Current Tuition Value 836,373 Tuition benefit payments and refunds (5,009,687) Ending balance, June 30, 2006 $ 108,320,697 The accruals for compensated absences represent obligations that may arise for earned but unused annual and sick leave as of June 30, Current liabilities of $29,586 represent obligations for compensated absences that will become due within a year from June 30, Noncurrent liabilities of $48,677 represent obligations for compensated absences that will become due more than a year after June 30, The accrued compensated absences liability at June 30, 2006, and changes for the fiscal year then ended are as follows: Beginning balance, June 30, 2005 $ 66,473 Additions 22,818 Reductions (11,028) Ending balance, June 30, 2006 $ 78, Employee Benefit Plans Plan Description The Program contributes to the PERS, a cost-sharing multiple-employer defined benefit pension plan administered by the West Virginia Consolidated Public Retirement Board ( CPRB ) pursuant to Chapter 5, Article 10D of the West Virginia Code. The PERS provides retirement, disability and death benefits to plan members and beneficiaries. The CPRB issues a publicly available financial report that includes financial statements and required supplementary information for the PERS. That report can be obtained by writing to CPRB, Capitol Complex, Building 5, Room 1000, Charleston WV Funding Policy Eligible employees are required to contribute 4.5% of their annual covered salary, and during the current fiscal year the Program was required to contribute 10.5% of covered employees salaries to the PERS. The contribution requirements of eligible employees and the Program are established and may be amended by the CPRB. The Program s contributions to the PERS were

49 $20,441, $19,047 and $21,388 for the years ended June 30, 2006, 2005 and 2004, respectively, equal to the required contributions for the period. 6. Transactions with State Treasurer s Office The State Treasurer s Office provides various administrative services at no cost to the Program and pays certain administrative costs on behalf of the Program. Such administrative services and costs approximated $46,400 for the year ended June 30, Risk Management The Program is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors and omissions; injuries to and illnesses of employees; and natural disasters. The Program has obtained health coverage for its employees through PEIA. PEIA provides the following basic employee benefit coverage to all participants: hospital, surgical, group major medical, basic group life, accidental death, and prescription drug coverage for active and retired employees of the State of West Virginia and various related State and non-state agencies. Additionally, the Program has obtained coverage for job-related injuries through its participation in the private, employer-owned mutual insurance company BrickStreet Insurance. Furthermore, the Program uses the West Virginia State Board of Risk and Insurance Management, which provides a public entity risk pool, to obtain coverage in the amount of $1,000,000 per occurrence for general liability and property damage. There have been no claims since the inception of the Program. 8. Net Assets Deficiency The Prepaid Tuition Plan has a net assets deficiency of approximately $5.3 million as of June 30, This deficiency was largely caused by investment losses in fiscal year 2002, unexpected tuition increases beginning with the school year, and changes in prior years of estimates of future investment rate of return and tuition growth. The Program s ability to pay obligations of the Prepaid Tuition Plan is dependent on long-term investment programs and adequate levels of future cash flows. Management sought and received support from the State Legislature in the form of a pledge of assets from the State Unclaimed Property Trust Fund to support payment of Prepaid Tuition Plan benefits. In March 2003, the Legislature created the Prepaid Tuition Trust Escrow Account to guarantee payment of Prepaid Tuition Plan contracts. Under the initial legislative action, the Escrow Account will receive transfers of up to $500,000 from the State Unclaimed Property Trust Fund each year there is an actuarially determined unfunded liability of the Prepaid Tuition Plan. In the 2006 legislative session, the amount was increased to $1,000,000. All earnings on the transferred funds will remain in the Escrow Account. In the event the Prepaid Tuition Plan is unable to cover the amount of money needed to meet its current obligations, funds may be withdrawn from the Escrow Account to meet those obligations. In December 2005, 2004 and 2003, $500,000 was

50 transferred each year to the Escrow Account because the Prepaid Tuition Plan had actuarial deficits of approximately $6.6 million at June 30, 2005, $11.8 million at June 30, 2004, and $13.5 million at June 30, The funds were invested and have had a net investment gain of $53,340 for the three years ended June 30, 2006, leaving the account with a balance of $1,553,340 at June 30, Because there was an actuarially determined unfunded liability of approximately $5.3 million in the Prepaid Tuition Plan as of June 30, 2006, an additional $1,000,000 is expected to be transferred from the Unclaimed Property Trust Fund to the Escrow Account on or before December 15, 2006, in accordance with the provisions enacted by the Legislature. Funds transferred or to be transferred into the Escrow Account do not affect the actuarial valuation of the Prepaid Tuition Plan and are not included in the Prepaid Tuition Plan s basic financial statements. Effective March 8, 2003, the West Virginia Legislature closed the Prepaid Tuition Plan to new contracts until the Legislature authorizes the plan to reopen. According to State Code ( (g)), closing the plan to new contracts shall not mean that the Prepaid Tuition Plan is closed and shall not affect any contracts in effect on March 8, Contract holders will continue to pay any amounts due, and the Prepaid Tuition Plan will continue to pay all benefits due. It is unknown what affect, if any, the closure to new enrollment will have on the financial position of the Prepaid Tuition Plan. Management believes that the Prepaid Tuition Plan will continue to have sufficient liquid resources to meet its obligations as they become due through June 30, The accompanying financial statements do not reflect any adjustments that might result should management s actions to eliminate the net assets deficiency fail to be successful. 9. Significant Accounting Policies - Savings Plan Basis of Accounting As a fiduciary fund, the Savings Plan s financial statements are presented on the flow of economic resources measurement focus and the accrual basis of accounting. As mentioned in Note 2, the Savings Plan is a private-purpose trust fund, which is a type of fiduciary fund. Fiduciary funds are used to report assets held in a trustee or agency capacity for others and therefore cannot be used to support a government s own programs. A private-purpose trust fund is a fiduciary fund used to report all trust arrangements, other than pension (and other employee benefit) trust funds and investment trust funds, under which principal and income benefit individuals, private organizations, or other governments. Revenues mainly are derived from investment income. Expenses consist primarily of investment expenses and administrative costs associated with the Savings Plan. Security Transactions and Income Security transactions of the Savings Plan are recorded on the trade date (date the order to buy or sell is executed). Dividend income and capital gain distribution from the underlying funds, if any, are recorded on the ex-dividend date. Realized gains and losses on securities transactions are computed on the basis of identified cost

51 Security Valuation s in the underlying funds are valued at the closing net asset value per share of each underlying fund on the day of valuation. Units Contributions by a participant are evidenced through the issuance of units in the particular portfolio or fund. Contributions and withdrawals are subject to terms and limitations defined in the participation agreement between the participant and the Savings Plan. Contributions are invested in units of the assigned portfolio or fund on the same day as the credit of the contribution to the participant s account. Withdrawals are based on the unit value calculated for such portfolio or fund on the day that the withdrawal request is accepted. The earnings portion of non-qualified withdrawals, in addition to applicable federal and state income tax, may be subject to a 10% non-qualified withdrawal penalty to be withheld from the withdrawal. Expenses Expenses in the Savings Plan financial statements reflect investment management fees, and distribution and administrative charges. s Hartford Life invests and manages the Savings Plan investments in 116 different portfolios and individual funds. Each portfolio and fund in turn is either a mutual fund or contains multiple mutual funds. s are reported at fair value, which is the same as the value of the pool shares, and are accounted for by the Savings Plan accordingly, with changes in the fair value included in investment earnings. The following represents a calculation of the net increase in the fair value of investments during the year ended June 30, 2006: Fair value at end of year $ 764,221,788 Less cost of investments purchased during year (246,533,904) Plus cost of investments redeemed during year 64,200,510 Less fair value at beginning of year (552,929,632) Change in fair value of investments during year $ 28,958,762 The Program has adopted an investment policy for the Savings Plan that requires blended benchmarks for the various funds and portfolios. While the diversified benchmarks represent the diversification of the funds and portfolios and diversification in general results in risk reduction the investment policy does not specifically address custodial credit risk, credit risk, concentration credit risk, interest rate risk or foreign currency risk. s in the Savings Plan represent units of mutual funds rather than specific securities, and as such are not exposed to those risks. Neither the Program, the Savings Plan, nor the funds and portfolios have been rated for credit risk by any organization

52 Related Parties and Fund Managers and Advisors SMART529 WV Direct College Savings Plan & Director SMART529 College Savings Plan Except for the SMART529 Stable Value Portfolios, underlying funds in the Savings Plan s SMART529 WV Direct College Savings Plan and Director SMART529 College Savings Plan are managed by Hartford Financial Services, LLC ( HIFSCO ), which is a wholly owned indirect subsidiary of The Hartford, Hartford Life s parent company. The SMART529 Stable Value Portfolios are managed by INVESCO International (N.A.), Inc., which is a unit of AMVESCAP PLC global investment management organization. HIFSCO supervises the investment activities of the investment sub-advisors below. Hartford Management Company ( HIMCO ) is a wholly owned subsidiary of The Hartford and is investment sub-advisor to The Hartford Total Return Bond Fund, The Hartford Inflation Plus Fund, The Hartford High Yield Fund and The Hartford Money Market Fund. Wellington Management Company, LLP ( Wellington Management ) is investment sub-advisor to the following underlying funds: The Hartford Capital Appreciation Fund, The Hartford MidCap Fund, The Hartford Global Leaders Fund, The Hartford Stock Fund, The Hartford Advisers Fund and The Hartford Dividend and Growth Fund. Leaders SMART529 College Savings Plan AIM Advisors, Inc. is investment advisor for AIM Aggressive Growth Fund, AIM Basic Value Fund, AIM Constellation Fund, and AIM Large Cap Basic Value Fund, and is responsible for their day-to-day management. The AIM Basic Value 529 Fund, The AIM Aggressive Growth 529 Fund, The AIM Constellation 529 Fund, and The AIM Large Cap Basic Value 529 Fund purchase Class A shares of underlying mutual funds sponsored by AIM. Capital Research and Management Company, a wholly owned subsidiary of The Capital Group Companies, Inc., is investment advisor to American Mutual Fund and other funds, including those in American Funds. The American Mutual 529 Fund purchases Class F shares of an underlying mutual fund sponsored by American Funds. Franklin Advisers, Inc. is investment manager for the Franklin Capital Growth Fund, the Franklin Small-Mid Cap Growth Fund, and the Franklin Strategic Income Fund. Franklin Mutual Advisers, LLC, is investment manager for the Mutual Shares Fund. Templeton Global Advisors Limited is investment manager for the Templeton Foreign Fund. The Franklin Capital Growth 529 Fund, The Franklin Small-Mid Cap Growth 529 Fund, The Franklin Strategic Income 529 Fund, The Mutual Shares 529 Fund, and The Templeton Foreign 529 Fund purchase Class A shares of underlying mutual funds sponsored by Franklin Templeton. Massachusetts Financial Services Company ( MFS ) is investment advisor to the MFS Research Bond Fund, MFS Total Return Fund, MFS Value Fund, Massachusetts Investors Trust Fund, and Massachusetts Investors Growth Stock Fund. The Massachusetts Investors Growth Stock 529 Fund, The Massachusetts Investors Trust 529 Fund, The MFS Research Bond 529 Fund, The MFS Total Return 529 Fund, and The MFS Value 529 Fund purchase Class A shares of underlying mutual funds sponsored by MFS

53 Cornerstone SMART529 College Savings Plan Capital Research and Management Company is investment advisor to American Mutual Fund and other funds, including those in American Funds. The American Mutual 529 Fund purchases Class F shares of an underlying fund sponsored by American Funds. Federated Management Company ( Federated Investors ) is investment advisor to the Federated Capital Appreciation, Federated Market Opportunity, and the Federated Total Return Bond Funds. The Federated Capital Appreciation 529 Fund, The Federated Market Opportunity 529 Fund, and The Federated Total Return Bond 529 Fund purchase Class A shares of underlying funds managed by Federated Investors. Goldman Sachs Asset Management, L.P. ( GSAM ), an affiliate of Goldman, Sachs & Co., is investment advisor to the Goldman Sachs Core Fixed Income Fund, the Goldman Sachs Government Income Fund, the Goldman Sachs Large Cap Value Fund, and the Goldman Sachs Core U.S. Equity Fund. The Goldman Sachs Large Cap Value 529 Fund, The Goldman Sachs Core U.S. Equity 529 Fund, The Goldman Sachs Government Income 529 Fund, and The Goldman Sachs Core Fixed Income 529 Fund purchase Class A shares of underlying funds sponsored by Goldman Sachs. Lord, Abbett & Co. LLC is investment advisor to the Lord Abbett Affiliated Fund, the Lord Abbett Bond-Debenture Fund, and the Lord Abbett Mid-Cap Value Fund. The Lord Abbett Affiliated 529 Fund, The Lord Abbett Mid-Cap Value 529 Fund, and The Lord Abbett Bond- Debenture 529 Fund purchase Class A shares of underlying funds managed by Lord Abbett. Putnam Management, LLC is investment manager for the Limited Duration Government Income Fund, Putnam International Equity Fund, Putnam Equity Income Fund, and Putnam Voyager Fund. The Putnam International Equity 529 Fund, The Putnam Voyager 529 Fund, The Putnam Equity Income 529 Fund, and Limited Duration Government Income 529 Fund purchase Class A shares of underlying funds sponsored by Putnam. Van Kampen Asset Management Inc., a wholly owned subsidiary of Van Kampen s Inc., is investment advisor to the Van Kampen Comstock Fund, Van Kampen Emerging Growth Fund, and Van Kampen Growth and Income Fund. The Van Kampen Comstock 529 Fund, The Van Kampen Emerging Growth 529 Fund, and The Van Kampen Growth and Income 529 Fund purchase Class A shares of underlying funds sponsored by Van Kampen s Inc. SMART529 Select College Savings Plan Dimensional Fund Advisors Inc. is investment advisor to the underlying DFA portfolios in the SMART529 Select College Savings Plan. Hartford Securities Distribution Company, Inc. ( HSD ) is a wholly owned subsidiary of The Hartford and a registered broker-dealer. HSD is engaged in the SMART529 distribution activities which includes marketing, distribution and clearing of shares through broker-dealers, financing distribution costs, supervising the activities of the transfer agent, and maintaining financial books and records. Hartford Life and the West Virginia State Treasurer s Office provide administrative services

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55 Supplemental Information The following information is presented for the purpose of additional analysis and is not a required part of the financial statements of the Program. This section shows financial information of each investment portfolio and individual fund of the Savings Plan, which is a fiduciary fund of the Program

56 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Fiduciary Net Assets June 30, 2006 SMART529 WV Direct Age-Based Portfolio 0-8 ** SMART529 WV Direct Age-Based Portfolio 9-13 ** SMART529 WV Direct Age-Based Portfolio ** SMART529 WV Direct Age-Based Portfolio 19+ ** Assets: s in underlying funds, at value * $ 9,722,355 $ 7,400,968 $ 6,396,994 $ 1,909,172 Receivables for units and securities sold 78,223 69,568 69,985 14,869 Dividends receivable Other receivables Total assets 9,800,578 7,470,536 6,466,979 1,924,041 Liabilities: Payable for units redeemed and securities purchased 71,976 66,726 67,346 13,785 Accrued fees 3,002 2,518 2,884 1,120 Total liabilities 74,978 69,244 70,230 14,905 Net Assets $ 9,725,600 $ 7,401,292 $ 6,396,749 $ 1,909,136 Net Assets Consists of: Class A Net Assets $ - $ - $ - $ - Units outstanding Net Asset Value $ - $ - $ - $ - Class B Net Assets $ - $ - $ - $ - Units outstanding Net Asset Value $ - $ - $ - $ - Class C Net Assets $ - $ - $ - $ - Units outstanding Net Asset Value $ - $ - $ - $ - Class D Net Assets $ 9,725,600 $ 7,401,292 $ 6,396,749 $ 1,909,136 Units outstanding 684, , , ,266 Net Asset Value $ $ $ $ Class E Net Assets $ - $ - $ - $ - Units outstanding Net Asset Value $ - $ - $ - $ - * Identified Cost $ 10,025,952 $ 7,484,932 $ 6,376,196 $ 1,904,742 ** The SMART529 WV Direct and the Director SMART529 groups of portfolios and funds with similar names had been combined in prior years. For example, SMART529 WV Direct Age-Based Portfolio 0-8 had been combined with Director SMART529 Age-Based Portfolio 0-8, SMART529 WV Direct Age-Based Portfolio 9-13 with Director SMART529 Age-Based 9-13, and so on

57 SMART529 WV Direct Aggressive Growth Portfolio ** SMART529 WV Direct Balanced Portfolio ** SMART529 WV Direct Conservative Balanced Portfolio SMART529 WV Direct Conservative Bond Portfolio SMART529 WV Direct Growth Portfolio ** SMART529 WV Direct Stable Value Fund ** $ 8,342,532 $ 5,536,660 $ 283,957 $ 285,892 $ 7,646,395 $ 2,646,820 43,816 52,641 1,826 1,832 61,985 2, ,386,348 5,589, , ,724 7,708,380 2,649,186 41,708 49,447 1,720 1,477 59, ,699 3, ,544 2,379 44,407 52,542 1,829 1,590 62,515 3,294 $ 8,341,941 $ 5,536,759 $ 283,954 $ 286,134 $ 7,645,865 $ 2,645,892 $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ 8,341,941 $ 5,536,759 $ 283,954 $ 286,134 $ 7,645,865 $ 2,645, , ,599 26,158 27, , ,291 $ $ $ $ $ $ $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ 8,419,577 $ 5,303,434 $ 288,913 $ 297,336 $ 7,424,960 $ 2,556,

58 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Fiduciary Net Assets (Continued) June 30, 2006 Director SMART529 Age- Based Portfolio 0-8 ** Director SMART529 Age- Based Portfolio 9-13 ** Director SMART529 Age- Based Portfolio ** Director SMART529 Age- Based Portfolio 19+ ** Assets: s in underlying funds, at value * $ 113,681,811 $ 81,891,991 $ 69,384,396 $ 11,059,704 Receivables for units and securities sold 894, , ,707 65,521 Dividends receivable Other receivables Total assets 114,576,367 82,698,407 70,209,103 11,125,225 Liabilities: Payable for units redeemed and securities purchased 830, , ,094 57,816 Accrued fees 82,326 64,616 63,272 11,683 Total liabilities 912, , ,366 69,499 Net Assets $ 113,663,672 $ 81,883,095 $ 69,407,737 $ 11,055,726 Net Assets Consists of: Class A Net Assets $ 59,693,210 $ 39,724,172 $ 34,719,492 $ 5,864,327 Units outstanding 4,242,784 3,019,352 2,683, ,137 Net Asset Value $ $ $ $ Class B Net Assets $ 29,839,479 $ 22,050,330 $ 11,105,088 $ 39,638 Units outstanding 2,157,468 1,706, ,344 3,456 Net Asset Value $ $ $ $ Class C Net Assets $ 14,908,195 $ 14,365,733 $ 19,302,449 $ 4,696,115 Units outstanding 1,084,476 1,119,235 1,529, ,327 Net Asset Value $ $ $ $ Class D Net Assets $ - $ - $ - $ - Units outstanding Net Asset Value $ - $ - $ - $ - Class E Net Assets $ 9,222,788 $ 5,742,860 $ 4,280,708 $ 455,646 Units outstanding 648, , ,186 38,489 Net Asset Value $ $ $ $ * Identified Cost $ 100,064,079 $ 76,467,657 $ 66,511,075 $ 10,999,205 ** The SMART529 WV Direct and the Director SMART529 groups of portfolios and funds with similar names had been combined in prior years. For example, SMART529 WV Direct Age-Based Portfolio 0-8 had been combined with Director SMART529 Age-Based Portfolio 0-8, SMART529 WV Direct Age-Based Portfolio 9-13 with Director SMART529 Age-Based 9-13, and so on

59 Director SMART529 Aggressive Growth Portfolio ** Director SMART529 Balanced Portfolio ** Director SMART529 Growth Portfolio ** Director SMART529 Stable Value Fund ** Director SMART529 The Hartford Advisers 529 Fund Director SMART529 The Hartford Capital Appreciation 529 Fund $ 35,213,004 $ 33,172,164 $ 51,201,830 $ 11,302,526 $ 13,248,175 $ 56,377, , , ,241 19,180 53, , ,469,278 33,491,404 51,696,071 11,321,706 13,301,808 56,600, , , ,163 1,136 42, ,638 24,592 33,318 39,643 15,783 11,158 42, , , ,806 16,919 54, ,645 $ 35,213,375 $ 33,159,837 $ 51,201,265 $ 11,304,787 $ 13,247,777 $ 56,376,377 $ 15,801,874 $ 18,302,887 $ 26,744,842 $ 3,192,374 $ 7,628,503 $ 29,070,579 1,105,545 1,398,909 1,935, , ,049 1,790,855 $ $ $ $ $ $ $ 7,184,911 $ 6,004,165 $ 9,807,133 $ 2,530,175 $ 2,591,554 $ 8,326, , , , , , ,119 $ $ $ $ $ $ $ 5,413,072 $ 7,254,086 $ 11,283,685 $ 4,014,102 $ 2,137,425 $ 11,156, , , , , , ,228 $ $ $ $ $ $ $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ 6,813,518 $ 1,598,699 $ 3,365,605 $ 1,568,136 $ 890,295 $ 7,822, , , , ,816 77, ,415 $ $ $ $ $ $ $ 33,264,223 $ 31,064,183 $ 47,506,504 $ 10,770,745 $ 12,032,710 $ 44,714,

60 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Fiduciary Net Assets (Continued) June 30, 2006 Director SMART529 The Hartford Dividend and Growth 529 Fund Director SMART529 The Hartford Global Leaders 529 Fund Director SMART529 The Hartford High Yield 529 Fund Director SMART529 The Hartford Inflation Plus 529 Fund Assets: s in underlying funds, at value * $ 26,287,803 $ 8,944,064 $ 433,254 $ 762,503 Receivables for units and securities sold 60,421 28, ,551 Dividends receivable Other receivables Total assets 26,348,224 8,972, , ,054 Liabilities: Payable for units redeemed and securities purchased 40,558 23, Accrued fees 20,540 5, Total liabilities 61,098 28, ,554 Net Assets $ 26,287,126 $ 8,943,895 $ 433,243 $ 762,500 Net Assets Consists of: Class A Net Assets $ 15,316,692 $ 4,594,678 $ 228,931 $ 317,914 Units outstanding 1,170, ,763 20,948 31,493 Net Asset Value $ $ $ $ Class B Net Assets $ 3,744,743 $ 1,046,042 $ 40,124 $ 145,412 Units outstanding 291,370 74,787 3,711 14,564 Net Asset Value $ $ $ $ 9.98 Class C Net Assets $ 5,145,821 $ 2,049,264 $ 125,913 $ 282,455 Units outstanding 402, ,426 11,693 28,409 Net Asset Value $ $ $ $ 9.94 Class D Net Assets $ - $ - $ 38,275 $ 16,719 Units outstanding - - 3,480 1,643 Net Asset Value $ - $ - $ $ Class E Net Assets $ 2,079,870 $ 1,253,911 $ - $ - Units outstanding 157,316 87, Net Asset Value $ $ $ - $ - * Identified Cost $ 22,557,016 $ 7,386,390 $ 447,674 $ 802,

61 Director SMART529 The Hartford MidCap 529 Fund Director SMART529 The Hartford Money Market 529 Fund Director SMART529 The Hartford Stock 529 Fund Director SMART529 The Hartford Total Return Bond 529 Fund Cornerstone SMART529 Age- Based Portfolio 0-8 Cornerstone SMART529 Age- Based Portfolio 9-13 $ 32,671,456 $ 642,399 $ 10,163,033 $ 10,286,641 $ 11,557,109 $ 7,677, , ,215 13, ,484 87,905-2, , ,816, ,697 10,194,248 10,299,756 11,736,593 7,771, , ,733 4, ,080 84,026 22, ,265 8,889 7,656 5, , ,998 13, ,736 89,184 $ 32,670,720 $ 644,931 $ 10,163,250 $ 10,286,648 $ 11,556,857 $ 7,682,039 $ 16,950,382 $ 279,669 $ 5,813,650 $ 4,994,823 $ 10,307,227 $ 6,805,503 1,049,792 26, , , , ,297 $ $ $ $ $ $ $ 4,145,394 $ 48,180 $ 1,286,165 $ 2,215,943 $ 933,649 $ 520, ,873 4, , ,115 67,628 40,537 $ $ $ $ $ $ $ 6,977,709 $ 301,454 $ 1,797,048 $ 2,503,711 $ 315,981 $ 356, ,650 29, , ,099 23,003 27,891 $ $ $ $ $ $ $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ 4,597,235 $ 15,628 $ 1,266,387 $ 572,171 $ - $ - 282,040 1, ,327 47, $ $ $ $ $ - $ - $ 27,740,622 $ 642,399 $ 8,620,826 $ 10,801,897 $ 10,827,144 $ 7,501,

62 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Fiduciary Net Assets (Continued) June 30, 2006 Cornerstone SMART529 Age- Based Portfolio Cornerstone SMART529 Age- Based Portfolio 19+ Cornerstone SMART529 Aggressive Growth Portfolio Cornerstone SMART529 Balanced Portfolio Assets: s in underlying funds, at value * $ 5,312,569 $ 883,457 $ 1,388,490 $ 2,785,661 Receivables for units and securities sold 41,779 7,773 13,282 18,418 Dividends receivable 4,718 1,155-2,359 Other receivables Total assets 5,359, ,385 1,401,772 2,806,438 Liabilities: Payable for units redeemed and securities purchased 39,487 7,107 12,787 16,409 Accrued fees 3, ,974 Total liabilities 43,300 7,776 13,753 18,383 Net Assets $ 5,315,766 $ 884,609 $ 1,388,019 $ 2,788,055 Net Assets Consists of: Class A Net Assets $ 4,326,134 $ 654,129 $ 1,140,383 $ 2,311,202 Units outstanding 353,650 58,273 77, ,213 Net Asset Value $ $ $ $ Class B Net Assets $ 149,595 $ 1,107 $ 186,106 $ 212,621 Units outstanding 12, ,785 17,078 Net Asset Value $ $ $ $ Class C Net Assets $ 840,037 $ 229,373 $ 61,530 $ 264,232 Units outstanding 69,946 20,829 4,248 21,332 Net Asset Value $ $ $ $ Class D Net Assets $ - $ - $ - $ - Units outstanding Net Asset Value $ - $ - $ - $ - Class E Net Assets $ - $ - $ - $ - Units outstanding Net Asset Value $ - $ - $ - $ - * Identified Cost $ 5,216,968 $ 882,817 $ 1,342,031 $ 2,707,

63 Cornerstone SMART529 Conservative Portfolio Cornerstone SMART529 Growth Portfolio Cornerstone SMART529 Stable Value 529 Fund Cornerstone American Mutual 529 Fund Cornerstone Federated Capital Appreciation 529 Fund Cornerstone Federated Market Opportunity 529 Fund $ 552,325 $ 4,565,977 $ 786,079 $ 4,495,472 $ 286,145 $ 434,541 3,436 48,490 1,128 5, ,520 4,615, ,207 4,501, , ,522 3,040 45, , ,014 1,113 2, ,449 48,590 1,167 6, ,068 $ 553,071 $ 4,566,722 $ 786,040 $ 4,495,112 $ 286,134 $ 434,454 $ 464,276 $ 4,052,650 $ 438,701 $ 4,137,630 $ 258,181 $ 379,018 39, ,486 40, ,135 21,005 30,870 $ $ $ $ $ $ $ 23,304 $ 345,204 $ 18,867 $ 280,886 $ 26,227 $ 22,219 2,031 24,969 1,757 21,260 2,162 1,832 $ $ $ $ $ $ $ 65,491 $ 168,868 $ 328,472 $ 76,596 $ 1,726 $ 33,217 5,741 12,275 30,777 5, ,757 $ $ $ $ $ $ $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ 548,188 $ 4,371,944 $ 747,610 $ 4,180,153 $ 273,827 $ 430,

64 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Fiduciary Net Assets (Continued) June 30, 2006 Cornerstone Federated Total Return Bond 529 Fund Cornerstone Goldman Sachs Core Fixed Income 529 Fund Cornerstone Goldman Sachs Government Income 529 Fund Cornerstone Goldman Sachs Large Cap Value 529 Fund Assets: s in underlying funds, at value * $ 255,646 $ 312,873 $ 116,657 $ 448,780 Receivables for units and securities sold ,525 Dividends receivable 952 1, Other receivables Total assets 256, , , ,305 Liabilities: Payable for units redeemed and securities purchased ,234 Accrued fees Total liabilities ,535 Net Assets $ 256,497 $ 313,857 $ 117,070 $ 448,770 Net Assets Consists of: Class A Net Assets $ 208,172 $ 285,223 $ 56,912 $ 361,579 Units outstanding 20,013 27,235 5,527 24,450 Net Asset Value $ $ $ $ Class B Net Assets $ 15,400 $ 6,311 $ 51,630 $ 36,997 Units outstanding 1, ,085 2,533 Net Asset Value $ $ $ $ Class C Net Assets $ 32,925 $ 22,323 $ 8,528 $ 50,194 Units outstanding 3,229 2, ,452 Net Asset Value $ $ $ $ Class D Net Assets $ - $ - $ - $ - Units outstanding Net Asset Value $ - $ - $ - $ - Class E Net Assets $ - $ - $ - $ - Units outstanding Net Asset Value $ - $ - $ - $ - * Identified Cost $ 265,536 $ 327,818 $ 118,909 $ 434,808 ** Effective January 1, 2006, the Cornerstone Goldman Sachs Core U.S. Equity 529 Fund changed its name to Cornerstone Goldman Sachs Structured U.S. Equity 529 Fund

65 Cornerstone Goldman Sachs Structured U.S. Equity 529 Fund ** Cornerstone The Hartford Advisers 529 Fund Cornerstone The Hartford Capital Appreciation 529 Fund Cornerstone The Hartford MidCap 529 Fund Cornerstone Lord Abbett Affiliated 529 Fund Cornerstone Lord Abbett Bond- Debenture 529 Fund $ 240,611 $ 580,828 $ 7,349,209 $ 3,403,758 $ 4,701,574 $ 1,743, ,643 20,200 12,672 3, , ,802 7,447,854 3,423,965 4,714,246 1,747, ,991 18,179 10,496 1, ,812 2,097 3,022 1, ,080 98,803 20,276 13,518 3,086 $ 240,538 $ 580,722 $ 7,349,051 $ 3,403,689 $ 4,700,728 $ 1,743,956 $ 218,161 $ 565,277 $ 6,473,151 $ 2,935,965 $ 4,459,908 $ 1,621,154 15,365 47, , , , ,465 $ $ $ $ $ $ $ 11,792 $ 12,490 $ 499,127 $ 211,012 $ 180,984 $ 84, ,059 29,206 13,202 13,058 7,182 $ $ $ $ $ $ $ 10,585 $ 2,955 $ 376,773 $ 256,712 $ 59,836 $ 38, ,146 16,133 4,339 3,314 $ $ $ $ $ $ $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ 212,461 $ 553,829 $ 6,405,780 $ 3,136,862 $ 4,420,500 $ 1,802,

66 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Fiduciary Net Assets (Continued) June 30, 2006 Cornerstone Cornerstone Lord Abbett MidCap Value 529 Fund Cornerstone Putnam Equity Income 529 Fund Putnam Limited Duration Goverment Income 529 Fund Cornerstone Putnam International Equity 529 Fund Assets: s in underlying funds, at value * $ 4,025,326 $ 195,148 $ 2,932 $ 680,615 Receivables for units and securities sold 72, ,042 Dividends receivable Other receivables Total assets 4,097, ,413 2, ,657 Liabilities: Payable for units redeemed and securities purchased 69, Accrued fees 2, Total liabilities 72, ,058 Net Assets $ 4,025,239 $ 195,144 $ 2,940 $ 680,599 Net Assets Consists of: Class A Net Assets $ 3,695,610 $ 154,988 $ 991 $ 546,262 Units outstanding 237,904 11, ,095 Net Asset Value $ $ $ 9.91 $ Class B Net Assets $ 240,556 $ 16,657 $ 977 $ 64,116 Units outstanding 15,677 1, ,811 Net Asset Value $ $ $ 9.77 $ Class C Net Assets $ 89,073 $ 23,499 $ 972 $ 70,221 Units outstanding 5,833 1, ,193 Net Asset Value $ $ $ 9.72 $ Class D Net Assets $ - $ - $ - $ - Units outstanding Net Asset Value $ - $ - $ - $ - Class E Net Assets $ - $ - $ - $ - Units outstanding Net Asset Value $ - $ - $ - $ - * Identified Cost $ 3,890,814 $ 191,159 $ 3,033 $ 595,

67 Cornerstone Putnam Voyager 529 Fund Cornerstone Van Kampen Comstock 529 Fund Cornerstone Van Kampen Emerging Growth 529 Fund Cornerstone Van Kampen Growth and Income 529 Fund Leaders SMART529 Age-Based Portfolio 0-8 Leaders SMART529 Age-Based Portfolio 9-13 $ 139,528 $ 4,638,165 $ 437,219 $ 2,093,292 $ 9,073,325 $ 5,431, , , ,711 82, , ,620 4,649, ,689 2,119,076 9,191,036 5,518, , , ,993 79, , ,362 7,492 4, , , ,485 83,944 $ 139,492 $ 4,638,311 $ 437,116 $ 2,093,248 $ 9,071,551 $ 5,434,058 $ 132,406 $ 4,287,597 $ 340,046 $ 1,910,752 $ 5,233,448 $ 2,852,015 11, ,844 27, , , ,315 $ $ $ $ $ $ $ 4,135 $ 259,721 $ 25,778 $ 94,903 $ 2,423,055 $ 1,496, ,274 2,081 6, , ,730 $ $ $ $ $ $ $ 2,951 $ 90,993 $ 71,292 $ 87,593 $ 1,415,048 $ 1,085, ,435 5,784 6, ,405 86,561 $ $ $ $ $ $ $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ 137,048 $ 4,490,084 $ 409,681 $ 1,956,669 $ 8,592,438 $ 5,287,

68 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Fiduciary Net Assets (Continued) June 30, 2006 Leaders SMART529 Age- Based Portfolio Leaders SMART529 Age- Based Portfolio 19+ Leaders SMART529 Aggressive Growth Portfolio Leaders SMART529 Balanced Portfolio Assets: s in underlying funds, at value * $ 4,065,140 $ 632,318 $ 2,818,574 $ 2,937,028 Receivables for units and securities sold 37,906 3,536 31,656 33,368 Dividends receivable 3, ,238 Other receivables Total assets 4,106, ,386 2,850,231 2,972,634 Liabilities: Payable for units redeemed and securities purchased 35,303 3,128 30,378 31,321 Accrued fees 3, ,137 2,531 Total liabilities 38,684 3,616 32,515 33,852 Net Assets $ 4,067,462 $ 632,770 $ 2,817,716 $ 2,938,782 Net Assets Consists of: Class A Net Assets $ 2,423,766 $ 450,033 $ 1,945,657 $ 1,568,402 Units outstanding 199,555 38, , ,352 Net Asset Value $ $ $ $ Class B Net Assets $ 564,396 $ 1,141 $ 417,209 $ 368,779 Units outstanding 47, ,322 30,116 Net Asset Value $ $ $ $ Class C Net Assets $ 1,079,300 $ 181,596 $ 454,850 $ 1,001,601 Units outstanding 90,721 16,002 34,314 82,204 Net Asset Value $ $ $ $ Class D Net Assets $ - $ - $ - $ - Units outstanding Net Asset Value $ - $ - $ - $ - Class E Net Assets $ - $ - $ - $ - Units outstanding Net Asset Value $ - $ - $ - $ - * Identified Cost $ 3,983,130 $ 625,010 $ 2,636,628 $ 2,872,

69 Leaders SMART529 Conservative Portfolio Leaders SMART529 Growth Portfolio Leaders The Smart529 Stable Value Fund Leaders AIM Basic Value 529 Fund Leaders AIM Constellation 529 Fund Leaders AIM Large Cap Basic Value 529 Fund $ 921,564 $ 3,921,075 $ 583,814 $ 527,316 $ 608,700 $ 322,667 4, , , ,625 4,044, , , , ,916 3, , , , , $ 922,207 $ 3,923,096 $ 583,717 $ 527,258 $ 608,604 $ 322,617 $ 452,502 $ 2,477,393 $ 229,278 $ 242,507 $ 295,428 $ 225,253 37, ,032 21,111 17,664 22,506 16,487 $ $ $ $ $ $ $ 103,526 $ 820,341 $ 85,114 $ 65,959 $ 100,821 $ 64,584 8,657 63,726 7,939 4,865 7,777 4,789 $ $ $ $ $ $ $ 366,179 $ 625,362 $ 269,325 $ 218,792 $ 212,355 $ 32,780 30,783 48,824 25,253 16,220 16,459 2,442 $ $ $ $ $ $ $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ 909,004 $ 3,776,743 $ 554,696 $ 473,825 $ 606,677 $ 286,

70 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Fiduciary Net Assets (Continued) June 30, 2006 Leaders American Mutual 529 Fund Leaders Franklin Capital Growth 529 Fund Leaders Franklin Small-Mid Cap Growth 529 Fund Leaders Franklin Strategic Income 529 Fund Assets: s in underlying funds, at value * $ 1,832,032 $ 378,467 $ 1,258,729 $ 692,528 Receivables for units and securities sold 9,676 1,577 8,139 6,815 Dividends receivable Other receivables Total assets 1,841, ,044 1,266, ,343 Liabilities: Payable for units redeemed and securities purchased 8,279 1,327 7,154 6,233 Accrued fees 1, , Total liabilities 9,724 1,649 8,173 6,835 Net Assets $ 1,831,984 $ 378,395 $ 1,258,695 $ 692,508 Net Assets Consists of: Class A Net Assets $ 1,159,538 $ 198,123 $ 739,915 $ 340,333 Units outstanding 86,710 16,329 50,509 28,644 Net Asset Value $ $ $ $ Class B Net Assets $ 380,765 $ 96,425 $ 233,947 $ 169,422 Units outstanding 28,836 8,053 16,161 14,451 Net Asset Value $ $ $ $ Class C Net Assets $ 291,681 $ 83,847 $ 284,833 $ 182,753 Units outstanding 22,208 7,041 19,771 15,674 Net Asset Value $ $ $ $ Class D Net Assets $ - $ - $ - $ - Units outstanding Net Asset Value $ - $ - $ - $ - Class E Net Assets $ - $ - $ - $ - Units outstanding Net Asset Value $ - $ - $ - $ - * Identified Cost $ 1,711,911 $ 357,389 $ 1,080,725 $ 709,

71 Leaders Massachusetts Investors Growth Stock 529 Fund Leaders Massachusetts Investors Trust 529 Fund Leaders MFS Research Bond 529 Fund Leaders MFS Total Return 529 Fund Leaders MFS Value 529 Fund Leaders Mutual Shares 529 Fund $ 346,101 $ 154,822 $ 188,121 $ 712,598 $ 375,302 $ 1,259, , , , , , , , , ,118 1,269, , , , , , , ,711 $ 346,056 $ 154,807 $ 188,936 $ 713,905 $ 375,247 $ 1,259,881 $ 219,315 $ 97,676 $ 86,146 $ 411,162 $ 211,815 $ 748,841 18,320 7,379 8,271 33,027 14,397 50,961 $ $ $ $ $ $ $ 38,397 $ 10,108 $ 32,945 $ 135,110 $ 93,713 $ 209,404 3, ,208 10,998 6,449 14,424 $ $ $ $ $ $ $ 88,344 $ 47,023 $ 69,845 $ 167,633 $ 69,719 $ 301,636 7,513 3,615 6,839 13,718 4,823 20,881 $ $ $ $ $ $ $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ 317,493 $ 134,647 $ 200,830 $ 715,927 $ 346,129 $ 1,139,

72 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Fiduciary Net Assets (Continued) June 30, 2006 Leaders Templeton Foreign 529 Fund SMART529 Select Age-Based DFA Portfolio 0-3 SMART529 Select Age-Based DFA Portfolio 4-6 SMART529 Select Age-Based DFA Portfolio 7-9 Assets: s in underlying funds, at value * $ 1,435,443 $ 4,345,690 $ 2,760,461 $ 1,554,019 Receivables for units and securities sold 6,580 4,079 1,482 1,078 Dividends receivable Other receivables Total assets 1,442,023 4,349,769 2,761,943 1,555,097 Liabilities: Payable for units redeemed and securities purchased 5,417 2, Accrued fees 1,203 1,902 1, Total liabilities 6,620 4,142 1,369 1,019 Net Assets $ 1,435,403 $ 4,345,627 $ 2,760,574 $ 1,554,078 Net Assets Consists of: Class A Net Assets $ 783,985 $ - $ - $ - Units outstanding 47, Net Asset Value $ $ - $ - $ - Class B Net Assets $ 233,388 $ - $ - $ - Units outstanding 14, Net Asset Value $ $ - $ - $ - Class C Net Assets $ 418,030 $ - $ - $ - Units outstanding 25, Net Asset Value $ $ - $ - $ - Class D Net Assets $ - $ - $ - $ - Units outstanding Net Asset Value $ - $ - $ - $ - Class E Net Assets $ - $ 4,345,627 $ 2,760,574 $ 1,554,078 Units outstanding - 328, , ,813 Net Asset Value $ - $ $ $ * Identified Cost $ 1,282,012 $ 4,141,575 $ 2,699,192 $ 1,523,

73 SMART529 Select Age-Based DFA Portfolio SMART529 Select Age-Based DFA Portfolio SMART529 Select Age-Based DFA Portfolio SMART529 Select Age-Based DFA Portfolio 19+ SMART529 Select Aggressive Growth DFA Portfolio SMART529 Select Moderately Aggressive Growth DFA Portfolio $ 2,518,620 $ 1,673,430 $ 511,198 $ 253,166 $ 5,105,872 $ 1,113, , ,519,574 1,674, , ,273 5,109,717 1,114, , , , , $ 2,518,522 $ 1,673,330 $ 511,152 $ 253,143 $ 5,105,796 $ 1,114,159 $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ 2,518,522 $ 1,673,330 $ 511,152 $ 253,143 $ 5,105,796 $ 1,114, , ,845 45,712 23, ,358 86,503 $ $ $ $ $ $ $ 2,470,922 $ 1,649,824 $ 510,272 $ 252,733 $ 4,884,583 $ 1,071,

74 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Fiduciary Net Assets (Continued) June 30, 2006 SMART529 Select Growth DFA Portfolio SMART529 Select Moderate Growth DFA Portfolio SMART529 Select Balanced DFA Portfolio SMART529 Select Conservative DFA Portfolio Assets: s in underlying funds, at value * $ 3,184,881 $ 1,171,343 $ 632,395 $ 148,891 Receivables for units and securities sold 1, Dividends receivable Other receivables Total assets 3,186,688 1,171, , ,958 Liabilities: Payable for units redeemed and securities purchased Accrued fees 1, Total liabilities 1, Net Assets $ 3,185,184 $ 1,171,367 $ 632,359 $ 148,889 Net Assets Consists of: Class A Net Assets $ - $ - $ - $ - Units outstanding Net Asset Value $ - $ - $ - $ - Class B Net Assets $ - $ - $ - $ - Units outstanding Net Asset Value $ - $ - $ - $ - Class C Net Assets $ - $ - $ - $ - Units outstanding Net Asset Value $ - $ - $ - $ - Class D Net Assets $ - $ - $ - $ - Units outstanding Net Asset Value $ - $ - $ - $ - Class E Net Assets $ 3,185,184 $ 1,171,367 $ 632,359 $ 148,889 Units outstanding 253,701 96,924 54,369 13,851 Net Asset Value $ $ $ $ * Identified Cost $ 3,066,672 $ 1,152,493 $ 633,124 $ 150,

75 SMART529 Select Moderately Conservative DFA Portfolio SMART529 Select All Equity DFA Portfolio SMART529 Select Fixed Income DFA Portfolio SMART529 Select 1-Year Fixed DFA Portfolio $ 504,586 $ 8,830,963 $ 370,060 $ 77, , ,812 8,839, ,228 77, , , , $ 504,566 $ 8,830,830 $ 370,054 $ 77,198 $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ 504,566 $ 8,830,830 $ 370,054 $ 77,198 45, ,174 36,094 7,457 $ $ $ $ $ 508,635 $ 8,400,515 $ 373,110 $ 77,

76 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Changes in Fiduciary Net Assets For the year ended June 30, 2006 SMART529 WV Direct Age-Based Portfolio 0-8 *** SMART529 WV Direct Age-Based Portfolio 9-13 *** SMART529 WV Direct Age-Based Portfolio *** Income: * Dividends and capital gains from underlying funds $ 526,805 $ 346,969 $ 218,220 Total investment income 526, , ,220 Expenses: * Management and distribution fees 4,601 6,006 11,086 Administration fees 26,623 20,322 15,123 Total expenses 31,224 26,328 26,209 Net Income (Loss) 495, , ,011 Net Realized and Unrealized Gain (Loss): * Net realized gain (loss) on sale of underlying fund shares 1,883, , ,326 Net unrealized appreciation (depreciation) on underlying fund shares (1,332,892) (532,958) (325,541) Net realized and unrealized gain (loss) 550, , ,785 Net increase (decrease) in Net Assets Resulting from Operations 1,045, , ,796 Unit Transactions: ** Contributions Class A Class B Class C Class D 2,974,690 3,087,196 3,103,792 Class E Net proceeds from sale of units 2,974,690 3,087,196 3,103,792 Redemptions Class A Class B Class C Class D (1,476,261) (1,894,089) (946,447) Class E Total cost of units redeemed (1,476,261) (1,894,089) (946,447) Net Increase in Net Assets Derived from Unit Transactions 1,498,429 1,193,107 2,157,345 Net Assets: Total increase in net assets 2,544,415 1,707,361 2,454,141 Beginning of year 7,181,185 5,693,931 3,942,608 End of year $ 9,725,600 $ 7,401,292 $ 6,396,749 * The allocation of income, expenses, realized gain/loss and unrealized gain/loss changed during the year from the outstanding shares methodology to adjusted net asset methodology. ** Includes interportfolio and inferfund transactions. *** The SMART529 WV Direct and the Director SMART529 groups of portfolios and funds with similar names had been combined in prior years. For example, SMART529 WV Direct Age-Based Portfolio 0-8 had been combined with Director SMART529 Age-Based Portfolio 0-8, SMART529 WV Direct Age-Based Portfolio 9-13 with Director SMART529 Age-Based 9-13, and so on

77 SMART529 WV Direct Age-Based Portfolio 19+ *** SMART529 WV Direct Aggressive Growth Portfolio *** SMART529 WV Direct Balanced Portfolio *** SMART529 WV Direct Conservative Balanced Portfolio SMART529 WV Direct Conservative Bond Portfolio SMART529 WV Direct Growth Portfolio *** $ 42,929 $ 467,155 $ 237,425 $ 10,816 $ 13,991 $ 424,827 42, , ,425 10,816 13, ,827 6,367 4,607 17, ,020 5,017 21,151 14, ,167 11,384 25,758 31, ,173 25,187 31, , ,867 9,848 12, ,640 39,512 1,282, , (3,677) 559,290 (25,307) (913,121) (150,201) (5,552) (12,095) (322,450) 14, , ,683 (5,040) (15,772) 236,840 45, , ,550 4,808 (2,954) 636, ,075,511 2,416,728 1,592, , ,238 1,905, ,075,511 2,416,728 1,592, , ,238 1,905, (727,068) (304,167) (550,305) (62,794) (197,619) (355,875) (727,068) (304,167) (550,305) (62,794) (197,619) (355,875) 348,443 2,112,561 1,042, ,002 92,619 1,549, ,193 2,923,581 1,377, ,810 89,665 2,185,651 1,514,943 5,418,360 4,159, , ,469 5,460,214 $ 1,909,136 $ 8,341,941 $ 5,536,759 $ 283,954 $ 286,134 $ 7,645,

78 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Changes in Fiduciary Net Assets (Continued) For the year ended June 30, 2006 SMART529 WV Direct Stable Value Fund *** Director SMART529 Age- Based Portfolio 0-8 *** Director SMART529 Age- Based Portfolio 9-13 *** Income: * Dividends and capital gains from underlying funds $ - $ 6,489,169 $ 3,866,100 Total investment income - 6,489,169 3,866,100 Expenses: * Management and distribution fees 17, , ,531 Administration fees 7, , ,393 Total expenses 25, , ,924 Net Income (Loss) (25,027) 5,594,338 3,181,176 Net Realized and Unrealized Gain (Loss): * Net realized gain (loss) on sale of underlying fund shares 131,366 6,419,926 2,820,620 Net unrealized appreciation (depreciation) on underlying fund shares (27,739) 951,928 (426,700) Net realized and unrealized gain (loss) 103,627 7,371,854 2,393,920 Net increase (decrease) in Net Assets Resulting from Operations 78,600 12,966,192 5,575,096 Unit Transactions: ** Contributions Class A - 15,141,780 15,006,490 Class B - 7,982,054 8,214,719 Class C - 3,657,532 4,670,445 Class D 969, Class E - 11,721,806 7,900,961 Net proceeds from sale of units 969,075 38,503,172 35,792,615 Redemptions Class A - (8,878,910) (9,301,709) Class B - (4,445,136) (3,469,324) Class C - (2,830,591) (4,100,734) Class D (662,712) - - Class E - (10,689,963) (6,599,163) Total cost of units redeemed (662,712) (26,844,600) (23,470,930) Net Increase in Net Assets Derived from Unit Transactions 306,363 11,658,572 12,321,685 Net Assets: Total increase in net assets 384,963 24,624,764 17,896,781 Beginning of year 2,260,929 89,038,908 63,986,314 End of year $ 2,645,892 $ 113,663,672 $ 81,883,095 * The allocation of income, expenses, realized gain/loss and unrealized gain/loss changed during the year from the outstanding shares methodology to adjusted net asset methodology. ** Includes interportfolio and inferfund transactions. *** The SMART529 WV Direct and the Director SMART529 groups of portfolios and funds with similar names had been combined in prior years. For example, SMART529 WV Direct Age-Based Portfolio 0-8 had been combined with Director SMART529 Age-Based Portfolio 0-8, SMART529 WV Direct Age-Based Portfolio 9-13 with Director SMART529 Age-Based 9-13, and so on

79 Director SMART529 Age- Based Portfolio *** Director SMART529 Age- Based Portfolio 19+ *** Director SMART529 Aggressive Growth Portfolio *** Director SMART529 Balanced Portfolio *** Director SMART529 Growth Portfolio *** Director SMART529 Stable Value Fund *** $ 2,772,112 $ 222,324 $ 2,117,159 $ 1,618,936 $ 2,925,592 $ - 2,772, ,324 2,117,159 1,618,936 2,925, ,131 81, , , , , ,416 25,117 91,771 93, ,748 29, , , , , , ,220 2,124, ,877 1,868,283 1,251,589 2,512,363 (167,220) 2,508, ,028 3,522,734 1,703,382 2,838, ,531 (933,197) (63,769) (1,604,294) (773,875) (1,038,090) 70,402 1,574,876 71,259 1,918, ,507 1,799, ,933 3,699, ,136 3,786,723 2,181,096 4,312, ,713 12,768,643 3,730,329 3,828,738 2,627,825 5,741,174 1,250,561 4,310,519 44,748 1,694, ,281 2,559, ,860 7,111,683 3,016,101 1,412,067 1,466,577 2,214,773 1,212, ,755, ,223 8,269,875 1,871,136 3,958,851 2,234,306 29,946,377 7,455,401 15,204,990 6,760,819 14,474,244 5,515,340 (5,597,362) (1,140,085) (909,022) (1,519,252) (1,333,603) (601,413) (526,507) (28,953) (202,009) (237,277) (264,262) (155,568) (3,871,613) (1,249,289) (360,813) (772,857) (878,329) (1,077,303) (4,407,202) (592,441) (7,003,147) (1,819,792) (3,564,192) (1,845,679) (14,402,684) (3,010,768) (8,474,991) (4,349,178) (6,040,386) (3,679,963) 15,543,693 4,444,633 6,729,999 2,411,641 8,433,858 1,835,377 19,243,134 4,631,769 10,516,722 4,592,737 12,746,172 2,108,090 50,164,603 6,423,957 24,696,653 28,567,100 38,455,093 9,196,697 $ 69,407,737 $ 11,055,726 $ 35,213,375 $ 33,159,837 $ 51,201,265 $ 11,304,

80 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Changes in Fiduciary Net Assets (Continued) For the year ended June 30, 2006 Director SMART529 The Hartford Advisers 529 Fund Director SMART529 The Hartford Capital Appreciation 529 Fund Director SMART529 The Hartford Dividend and Growth 529 Fund Income: * Dividends and capital gains from underlying funds $ 272,571 $ 3,851,739 $ 1,256,752 Total investment income 272,571 3,851,739 1,256,752 Expenses: * Management and distribution fees 84, , ,803 Administration fees 38, ,244 69,909 Total expenses 123, , ,712 Net Income (Loss) 149,113 3,430,222 1,041,040 Net Realized and Unrealized Gain (Loss): * Net realized gain (loss) on sale of underlying fund shares 109, , ,592 Net unrealized appreciation (depreciation) on underlying fund shares 418,630 3,989,645 1,251,781 Net realized and unrealized gain (loss) 528,148 4,244,510 1,387,373 Net increase (decrease) in Net Assets Resulting from Operations 677,261 7,674,732 2,428,413 Unit Transactions: ** Contributions Class A 963,929 6,791,994 2,955,545 Class B 347,695 1,852, ,160 Class C 296,101 2,710,084 1,223,697 Class D Class E 159,463 1,888, ,822 Net proceeds from sale of units 1,767,188 13,242,360 5,322,224 Redemptions Class A (744,170) (1,301,954) (827,865) Class B (116,289) (149,427) (108,050) Class C (202,266) (429,938) (437,272) Class D Class E (56,420) (220,621) (79,685) Total cost of units redeemed (1,119,145) (2,101,940) (1,452,872) Net Increase in Net Assets Derived from Unit Transactions 648,043 11,140,420 3,869,352 Net Assets: Total increase in net assets 1,325,304 18,815,152 6,297,765 Beginning of year 11,922,473 37,561,225 19,989,361 End of year $ 13,247,777 $ 56,376,377 $ 26,287,126 * The allocation of income, expenses, realized gain/loss and unrealized gain/loss changed during the year from the outstanding shares methodology to adjusted net asset methodology. ** Includes interportfolio and inferfund transactions

81 Director SMART529 The Hartford Global Leaders 529 Fund Director SMART529 The Hartford High Yield 529 Fund Director SMART529 The Hartford Inflation Plus 529 Fund Director SMART529 The Hartford MidCap 529 Fund Director SMART529 The Hartford Money Market 529 Fund Director SMART529 The Hartford Stock 529 Fund $ 114,005 $ 24,648 $ 35,122 $ 4,248,701 $ 26,046 $ 65, ,005 24,648 35,122 4,248,701 26,046 65,080 29,449 2,079 5, ,104 6,821 51,170 22,770 1,022 2,015 87,841 2,114 29,137 52,219 3,101 7, ,945 8,935 80,307 61,786 21,547 27,365 4,010,756 17,111 (15,227) 71, (4,499) 201, , ,343 (10,909) (43,648) (702,255) - 706, ,619 (10,887) (48,147) (500,256) - 859, ,405 10,660 (20,782) 3,510,500 17, ,677 1,205, , ,989 2,951, , ,577 14,921 89, , , ,218 37, ,561 1,512, ,379-24,677 17, , ,024, ,463 2,392, , ,097 6,299,392-1,689,782 (284,185) (19,911) (31,073) (882,379) (56,698) (585,615) (23,653) (317) (817) (99,108) (19,884) (79,792) (93,549) (13,053) (69,393) (376,503) (81,288) (225,484) - (19,033) (24,195) (74,715) - - (141,922) (11,003) (63,334) (476,102) (52,314) (125,478) (1,499,912) (168,873) (954,225) 1,915, , ,619 4,799,480 (168,873) 735,557 2,904, , ,837 8,309,980 (151,762) 1,580,234 6,039, , ,663 24,360, ,693 8,583,016 $ 8,943,895 $ 433,243 $ 762,500 $ 32,670,720 $ 644,931 $ 10,163,

82 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Changes in Fiduciary Net Assets (Continued) For the year ended June 30, 2006 Director SMART529 The Hartford Total Return Bond 529 Fund BB&T SMART529 Age- Based Portfolio 0-8 *** BB&T SMART529 Age- Based Portfolio 9-13 *** Income: * Dividends and capital gains from underlying funds $ 511,176 $ - $ 11 Total investment income 511, Expenses: * Management and distribution fees 70, Administration fees 30, Total expenses 101, Net Income (Loss) 409,760 (8) 2 Net Realized and Unrealized Gain (Loss): * Net realized gain (loss) on sale of underlying fund shares (24,215) 2,348 1,350 Net unrealized appreciation (depreciation) on underlying fund shares (579,639) (2,057) (1,180) Net realized and unrealized gain (loss) (603,854) Net increase (decrease) in Net Assets Resulting from Operations (194,094) Unit Transactions: ** Contributions Class A 1,093, Class B 263, Class C 480, Class D Class E 119, Net proceeds from sale of units 1,956, Redemptions Class A (696,432) (1,635) (1,425) Class B (75,992) (1,625) (1,418) Class C (476,176) (1,609) (1,404) Class D Class E (146,435) (1,603) (1,398) Total cost of units redeemed (1,395,035) (6,472) (5,645) Net Increase in Net Assets Derived from Unit Transactions 561,701 (6,472) (5,645) Net Assets: Total increase in net assets 367,607 (6,189) (5,473) Beginning of year 9,919,041 6,189 5,473 End of year $ 10,286,648 $ - $ - * The allocation of income, expenses, realized gain/loss and unrealized gain/loss changed during the year from the outstanding shares methodology to adjusted net asset methodology. ** Includes interportfolio and inferfund transactions. *** Closed operations August 31,

83 BB&T SMART529 Age-Based Portfolio *** BB&T SMART529 Age-Based Portfolio 19+ *** BB&T SMART529 Static Aggressive Growth Portfolio *** BB&T SMART529 Static Balanced Portfolio *** BB&T SMART529 Static Growth Portfolio *** BB&T The SMART529 Stable Value Fund *** $ 11 $ 36 $ - $ 11 $ 8 $ (10) 1 - (10) 1,040 1,131 2,451 1,204 1, (915) (992) (2,152) (1,059) (1,570) (275) (1,340) (3,439) (1,655) (1,384) (1,518) (1,055) (1,332) (3,419) (1,645) (1,377) (1,515) (1,048) (1,318) (3,379) (1,628) (1,362) (1,499) (1,040) (1,312) (3,365) (1,622) (1,356) (1,493) (1,036) (5,302) (13,602) (6,550) (5,479) (6,025) (4,179) (5,302) (13,602) (6,550) (5,479) (6,025) (4,179) (5,174) (13,454) (6,261) (5,333) (5,808) (4,158) 5,174 13,454 6,261 5,333 5,808 4,158 $ - $ - $ - $ - $ - $

84 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Changes in Fiduciary Net Assets (Continued) For the year ended June 30, 2006 BB&T The Hartford Advisers 529 Fund *** BB&T The Hartford Capital Appreciation 529 Fund *** BB&T The Hartford Dividend and Growth 529 Fund *** Income: * Dividends and capital gains from underlying funds $ - $ - $ - Total investment income Expenses: * Management and distribution fees Administration fees Total expenses Net Income (Loss) (5) (9) (8) Net Realized and Unrealized Gain (Loss): * Net realized gain (loss) on sale of underlying fund shares 451 1, Net unrealized appreciation (depreciation) on underlying fund shares (301) (1,503) (765) Net realized and unrealized gain (loss) Net increase (decrease) in Net Assets Resulting from Operations Unit Transactions: ** Contributions Class A Class B Class C Class D Class E Net proceeds from sale of units Redemptions Class A (1,147) (1,446) (1,271) Class B (1,142) (1,440) (1,266) Class C (1,133) (1,432) (1,257) Class D Class E (1,129) (1,428) (1,254) Total cost of units redeemed (4,551) (5,746) (5,048) Net Increase in Net Assets Derived from Unit Transactions (4,551) (5,746) (5,048) Net Assets: Total increase in net assets (4,406) (5,426) (4,880) Beginning of year 4,406 5,426 4,880 End of year $ - $ - $ - * The allocation of income, expenses, realized gain/loss and unrealized gain/loss changed during the year from the outstanding shares methodology to adjusted net asset methodology. ** Includes interportfolio and inferfund transactions. *** Closed operations August 31,

85 BB&T The Hartford Global Leaders 529 Fund *** BB&T Intermediate U.S. Government 529 Fund *** BB&T The Hartford MidCap 529 Fund *** BB&T MidCap Value 529 Fund *** BB&T The Hartford Stock 529 Fund *** BB&T The Hartford Total Return Bond 529 Fund *** $ - $ 27 $ - $ 1 $ - $ (5) 21 (8) (9) (7) 23 1,197 (194) 1,433 2, (926) 181 (1,290) (2,504) (456) (13) 271 (13) (12) (1,293) (1,041) (1,372) (1,723) (1,172) (1,110) (1,287) (1,036) (1,367) (1,714) (1,166) (1,105) (1,277) (1,024) (1,358) (1,697) (1,157) (1,095) (1,274) (1,019) (1,355) (1,691) (1,154) (1,092) (5,131) (4,120) (5,452) (6,825) (4,649) (4,402) (5,131) (4,120) (5,452) (6,825) (4,649) (4,402) (4,865) (4,112) (5,317) (6,561) (4,442) (4,391) 4,865 4,112 5,317 6,561 4,442 4,391 $ - $ - $ - $ - $ - $

86 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Changes in Fiduciary Net Assets (Continued) For the year ended June 30, 2006 Cornerstone SMART529 Age- Based Portfolio 0-8 Cornerstone SMART529 Age- Based Portfolio 9-13 Cornerstone SMART529 Age- Based Portfolio Income: * Dividends and capital gains from underlying funds $ 529,196 $ 408,525 $ 240,959 Total investment income 529, , ,959 Expenses: * Management and distribution fees 36,303 24,445 19,877 Administration fees 44,386 29,427 20,518 Total expenses 80,689 53,872 40,395 Net Income (Loss) 448, , ,564 Net Realized and Unrealized Gain (Loss): * Net realized gain (loss) on sale of underlying fund shares 182,674 88,830 57,478 Net unrealized appreciation (depreciation) on underlying fund shares 213,509 (54,183) (54,451) Net realized and unrealized gain (loss) 396,183 34,647 3,027 Net increase (decrease) in Net Assets Resulting from Operations 844, , ,591 Unit Transactions: ** Contributions Class A 3,843,296 2,961,232 1,718,213 Class B 310, ,620 93,188 Class C 126, , ,161 Class D Class E Net proceeds from sale of units 4,279,734 3,393,192 2,495,562 Redemptions Class A (1,474,581) (1,330,695) (701,775) Class B (117,036) (82,349) (250) Class C (23,016) (123,403) (518,678) Class D Class E Total cost of units redeemed (1,614,633) (1,536,447) (1,220,703) Net Increase in Net Assets Derived from Unit Transactions 2,665,101 1,856,745 1,274,859 Net Assets: Total increase in net assets 3,509,791 2,246,045 1,478,450 Beginning of year 8,047,066 5,435,994 3,837,316 End of year $ 11,556,857 $ 7,682,039 $ 5,315,766 * The allocation of income, expenses, realized gain/loss and unrealized gain/loss changed during the year from the outstanding shares methodology to adjusted net asset methodology. ** Includes interportfolio and inferfund transactions

87 Cornerstone SMART529 Age- Based Portfolio 19+ Cornerstone SMART529 Aggressive Growth Portfolio Cornerstone SMART529 Balanced Portfolio Cornerstone SMART529 Conservative Portfolio Cornerstone SMART529 Growth Portfolio Cornerstone SMART529 Stable Value 529 Fund $ 19,702 $ 100,153 $ 133,779 $ 21,887 $ 244,673 $ - 19, , ,779 21, ,673-2,602 4,421 9,798 2,125 13,100 7,804 2,698 5,396 10,994 2,175 16,031 2,758 5,300 9,817 20,792 4,300 29,131 10,562 14,402 90, ,987 17, ,542 (10,562) 6,237 57,586 32,453 5,567 57,812 4,238 (4,995) (25,335) (8,587) (7,822) 26,403 23,634 1,242 32,251 23,866 (2,255) 84,215 27,872 15, , ,853 15, ,757 17, , , , ,386 1,489, , ,942 78, ,411 1, ,399 29, ,288 26,150 99,027 96, , , , ,536 1,708, ,775 (235,203) (226,085) (182,174) (83,174) (216,712) (46,129) - (195) (2,158) (43,231) (1,006) (1,067) (40,526) (3,435) (7,391) (4,958) (8,916) (20,363) (275,729) (229,715) (191,723) (131,363) (226,634) (67,559) 484, , , ,173 1,481, , , , , ,505 1,781, , , ,378 2,107, ,566 2,785, ,514 $ 884,609 $ 1,388,019 $ 2,788,055 $ 553,071 $ 4,566,722 $ 786,

88 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Changes in Fiduciary Net Assets (Continued) For the year ended June 30, 2006 Cornerstone American Mutual 529 Fund Cornerstone Federated Capital Appreciation 529 Fund Cornerstone Federated Market Opportunity 529 Fund Income: * Dividends and capital gains from underlying funds $ 235,721 $ 8,086 $ 28,719 Total investment income 235,721 8,086 28,719 Expenses: * Management and distribution fees 14, ,338 Administration fees 18,247 1,222 1,602 Total expenses 32,314 2,188 2,940 Net Income (Loss) 203,407 5,898 25,779 Net Realized and Unrealized Gain (Loss): * Net realized gain (loss) on sale of underlying fund shares 44,770 4, Net unrealized appreciation (depreciation) on underlying fund shares 66,022 1,943 (310) Net realized and unrealized gain (loss) 110,792 6, Net increase (decrease) in Net Assets Resulting from Operations 314,199 12,154 25,855 Unit Transactions: ** Contributions Class A 757,285 40, ,368 Class B 82,133 4,340 15,357 Class C 37, ,853 Class D Class E Net proceeds from sale of units 876,980 45, ,578 Redemptions Class A (407,019) (32,039) (18,606) Class B (1,171) (264) (10,200) Class C (12,760) (794) (40) Class D Class E Total cost of units redeemed (420,950) (33,097) (28,846) Net Increase in Net Assets Derived from Unit Transactions 456,030 12, ,732 Net Assets: Total increase in net assets 770,229 24, ,587 Beginning of year 3,724, , ,867 End of year $ 4,495,112 $ 286,134 $ 434,454 * The allocation of income, expenses, realized gain/loss and unrealized gain/loss changed during the year from the outstanding shares methodology to adjusted net asset methodology. ** Includes interportfolio and inferfund transactions. *** Effective January 1, 2006, the Cornerstone Goldman Sachs Core U.S. Equity 529 Fund changed its name to Cornerstone Goldman Sachs Structured U.S. Equity 529 Fund

89 Cornerstone Federated Total Return Bond 529 Fund Cornerstone Goldman Sachs Core Fixed Income 529 Fund Cornerstone Goldman Sachs Government Income 529 Fund Cornerstone Goldman Sachs Large Cap Value 529 Fund Cornerstone Goldman Sachs Structured U.S. Equity 529 Fund *** Cornerstone The Hartford Advisers 529 Fund $ 10,922 $ 12,772 $ 2,285 $ 22,443 $ 759 $ 12,030 10,922 12,772 2,285 22, , , ,973 1,100 1, , ,520 2,087 2, ,498 1,712 4,493 8,835 10,617 1,723 19,945 (953) 7,537 (1,012) (915) (46) 2,242 2,599 5,212 (10,870) (14,228) (2,291) 1,785 17,626 18,761 (11,882) (15,143) (2,337) 4,027 20,225 23,973 (3,047) (4,526) (614) 23,972 19,272 31,510 55, ,754 21, ,663 41,216 70,516 4,009 1,967 50,200 23,261 7,761 2,438 23,944 17,105 7,600 40,904 1, , ,826 78, ,828 50,576 73,481 (39,357) (21,770) (2,424) (14,655) (4,941) (72,889) (1,087) (10) (2) (111) (36) (28) (42) (17) (6) (1,490) (2) (2,150) (40,486) (21,797) (2,432) (16,256) (4,979) (75,067) 43, ,029 76, ,572 45,597 (1,586) 40, ,503 75, ,544 64,869 29, , ,354 41, , , ,798 $ 256,497 $ 313,857 $ 117,070 $ 448,770 $ 240,538 $ 580,

90 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Changes in Fiduciary Net Assets (Continued) For the year ended June 30, 2006 Cornerstone The Hartford Capital Appreciation 529 Fund Cornerstone The Hartford MidCap 529 Fund Cornerstone Lord Abbett Affiliated 529 Fund Income: * Dividends and capital gains from underlying funds $ 436,342 $ 419,552 $ 341,208 Total investment income 436, , ,208 Expenses: * Management and distribution fees 17,784 8,317 14,250 Administration fees 25,343 12,916 18,970 Total expenses 43,127 21,233 33,220 Net Income (Loss) 393, , ,988 Net Realized and Unrealized Gain (Loss): * Net realized gain (loss) on sale of underlying fund shares 29,053 34,266 33,835 Net unrealized appreciation (depreciation) on underlying fund shares 440,183 (84,158) 112,850 Net realized and unrealized gain (loss) 469,236 (49,892) 146,685 Net increase (decrease) in Net Assets Resulting from Operations 862, , ,673 Unit Transactions: ** Contributions Class A 2,328, , ,346 Class B 206,706 53,567 58,330 Class C 179,423 77,086 16,689 Class D Class E Net proceeds from sale of units 2,714, , ,365 Redemptions Class A (258,273) (212,172) (266,898) Class B (6,017) (1,445) (31,228) Class C (14,791) (13,455) (47,630) Class D Class E Total cost of units redeemed (279,081) (227,072) (345,756) Net Increase in Net Assets Derived from Unit Transactions 2,435, , ,609 Net Assets: Total increase in net assets 3,297,755 1,058, ,282 Beginning of year 4,051,296 2,345,238 3,742,446 End of year $ 7,349,051 $ 3,403,689 $ 4,700,728 * The allocation of income, expenses, realized gain/loss and unrealized gain/loss changed during the year from the outstanding shares methodology to adjusted net asset methodology. ** Includes interportfolio and inferfund transactions

91 Cornerstone Lord Abbett Bond- Debenture 529 Fund Cornerstone Lord Abbett MidCap Value 529 Fund Cornerstone Putnam Equity Income 529 Fund Cornerstone Putnam Limited Duration Goverment Income 529 Fund Cornerstone Putnam International Equity 529 Fund Cornerstone Putnam Voyager 529 Fund $ 108,228 $ 332,048 $ 14,140 $ 185 $ 7,198 $ 1, , ,048 14, ,198 1,018 5,531 11, , ,220 15, , ,751 26,937 1, ,556 1,027 95, ,111 12, ,642 (9) ,357 1,457 (173) 3,747 1,292 (43,090) (163,157) (1,994) (45) 69, (42,591) (143,800) (537) (218) 73,572 1,541 52, ,311 12,278 (88) 77,214 1, ,575 1,263,487 60, ,761 46,260 26, ,082 13,885-37,033 3,175 13,781 37,826 18,700-49,363 1, ,956 1,432,395 92, ,157 51,269 (150,251) (206,310) (6,331) (3,919) (12,241) (13,845) (5,047) (7,425) (1,401) - (89) (4) (12,271) (12,715) (1,373) - (33) (167,569) (226,450) (9,105) (3,919) (12,363) (13,849) 190,387 1,205,945 83,754 (3,919) 366,794 37, ,273 1,367,256 96,032 (4,007) 444,008 38,952 1,500,683 2,657,983 99,112 6, , ,540 $ 1,743,956 $ 4,025,239 $ 195,144 $ 2,940 $ 680,599 $ 139,

92 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Changes in Fiduciary Net Assets (Continued) For the year ended June 30, 2006 Cornerstone Van Kampen Comstock 529 Fund Cornerstone Van Kampen Emerging Growth 529 Fund Cornerstone Van Kampen Growth and Income 529 Fund Income: * Dividends and capital gains from underlying funds $ 430,883 $ - $ 147,499 Total investment income 430, ,499 Expenses: * Management and distribution fees 13,592 1,334 5,896 Administration fees 17,477 1,558 7,535 Total expenses 31,069 2,892 13,431 Net Income (Loss) 399,814 (2,892) 134,068 Net Realized and Unrealized Gain (Loss): * Net realized gain (loss) on sale of underlying fund shares 27,453 3,476 8,410 Net unrealized appreciation (depreciation) on underlying fund shares (119,240) 12,391 (1,624) Net realized and unrealized gain (loss) (91,787) 15,867 6,786 Net increase (decrease) in Net Assets Resulting from Operations 308,027 12, ,854 Unit Transactions: ** Contributions Class A 1,303, , ,586 Class B 103,835 7,794 28,320 Class C 31,513 69,392 54,909 Class D Class E Net proceeds from sale of units 1,439, , ,815 Redemptions Class A (239,400) (25,526) (72,420) Class B (15,819) (50) (2,801) Class C (40,056) (18) (1,050) Class D Class E Total cost of units redeemed (295,275) (25,594) (76,271) Net Increase in Net Assets Derived from Unit Transactions 1,144, , ,544 Net Assets: Total increase in net assets 1,452, , ,398 Beginning of year 3,186, ,907 1,328,850 End of year $ 4,638,311 $ 437,116 $ 2,093,248 * The allocation of income, expenses, realized gain/loss and unrealized gain/loss changed during the year from the outstanding shares methodology to adjusted net asset methodology. ** Includes interportfolio and inferfund transactions

93 Leaders SMART529 Age- Based Portfolio 0-8 Leaders SMART529 Age- Based Portfolio 9-13 Leaders SMART529 Age- Based Portfolio Leaders SMART529 Age- Based Portfolio 19+ Leaders SMART529 Aggressive Growth Portfolio Leaders SMART529 Balanced Portfolio $ 116,186 $ 173,684 $ 104,555 $ 13,420 $ 30,793 $ 84, , , ,555 13,420 30,793 84,252 41,047 28,341 17,559 2,375 11,193 14,928 33,637 21,640 14,092 2,093 10,552 11,356 74,684 49,981 31,651 4,468 21,745 26,284 41, ,703 72,904 8,952 9,048 57, , ,006 25,337 5,283 55,149 47, ,270 (155) 20,631 (789) 102,915 1, , ,851 45,968 4, ,064 49, , , ,872 13, , ,661 2,285,295 1,743,919 1,364, , , ,044 1,123, , , , , , , , ,999 98, , ,979,748 2,900,158 2,218, , ,745 1,073,181 (731,992) (899,381) (281,566) (67,448) (38,204) (150,422) (258,188) (317,652) (4,562) - (11,749) (7,723) (266,461) (420,603) (204,889) (35,930) (471) (49,565) (1,256,641) (1,637,636) (491,017) (103,378) (50,424) (207,710) 2,723,107 1,262,522 1,727, , , ,471 3,219,248 1,502,076 1,846, , , ,132 5,852,303 3,931,982 2,221, ,067 1,868,283 1,965,650 $ 9,071,551 $ 5,434,058 $ 4,067,462 $ 632,770 $ 2,817,716 $ 2,938,

94 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Changes in Fiduciary Net Assets (Continued) For the year ended June 30, 2006 Leaders SMART529 Conservative Portfolio Leaders SMART529 Growth Portfolio Leaders The Smart529 Stable Value Fund Income: * Dividends and capital gains from underlying funds $ 20,940 $ 101,280 $ - Total investment income 20, ,280 - Expenses: * Management and distribution fees 4,033 16,747 7,112 Administration fees 2,409 14,891 2,409 Total expenses 6,442 31,638 9,521 Net Income (Loss) 14,498 69,642 (9,521) Net Realized and Unrealized Gain (Loss): * Net realized gain (loss) on sale of underlying fund shares 5, ,152 11,828 Net unrealized appreciation (depreciation) on underlying fund shares ,725 12,409 Net realized and unrealized gain (loss) 6, ,877 24,237 Net increase (decrease) in Net Assets Resulting from Operations 20, ,519 14,716 Unit Transactions: ** Contributions Class A 309, ,897 19,511 Class B 3, ,827 16,545 Class C 251, , ,566 Class D Class E Net proceeds from sale of units 564,523 1,067, ,622 Redemptions Class A (31,997) (258,419) (33,117) Class B (146) (12,336) (10,650) Class C (33,277) (25,466) (163,234) Class D Class E Total cost of units redeemed (65,420) (296,221) (207,001) Net Increase in Net Assets Derived from Unit Transactions 499, ,492 (5,379) Net Assets: Total increase in net assets 519, ,011 9,337 Beginning of year 402,479 2,953, ,380 End of year $ 922,207 $ 3,923,096 $ 583,717 * The allocation of income, expenses, realized gain/loss and unrealized gain/loss changed during the year from the outstanding shares methodology to adjusted net asset methodology. ** Includes interportfolio and inferfund transactions. *** Closed operations March 10,

95 Leaders AIM Aggressive Growth 529 Fund *** Leaders AIM Basic Value 529 Fund Leaders AIM Constellation 529 Fund Leaders AIM Large Cap Basic Value 529 Fund Leaders American Mutual 529 Fund Leaders Franklin Capital Growth 529 Fund $ - $ - $ - $ - $ 93,853 $ 1, ,853 1, , ,757 2,078 1,017 2,011 1,265 1,280 7,370 1,554 1,646 4,117 1,933 1,779 16,127 3,632 (1,646) (4,117) (1,933) (1,779) 77,726 (2,376) 64,450 3,706 1,113 1,357 25,357 5,317 (26,692) 24,699 (1,691) 20,642 20,125 14,309 37,758 28,405 (578) 21,999 45,482 19,626 36,112 24,288 (2,511) 20, ,208 17,250 45, , ,648 56, ,290 37,335 2,995 11,562 69, ,188 17,782 27,570 27, ,668 13,435 70,398 39, , , ,420 70, ,876 94,829 (194,651) (26,782) (4,553) (12,864) (56,472) (10,455) (46,446) (673) (1,648) (24) (13,977) (914) (170,930) (4,567) (981) (4,283) (91,006) (17,851) (412,027) (32,022) (7,182) (17,171) (161,455) (29,220) (335,999) 112, ,238 53, ,421 65,609 (299,887) 136, ,727 73, ,629 82, , , , ,124 1,554, ,536 $ - $ 527,258 $ 608,604 $ 322,617 $ 1,831,984 $ 378,

96 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Changes in Fiduciary Net Assets (Continued) For the year ended June 30, 2006 Leaders Franklin Small-Mid Cap Growth 529 Fund Leaders Franklin Strategic Income 529 Fund Leaders Massachusetts Investors Growth Stock 529 Fund Income: * Dividends and capital gains from underlying funds $ 1,237 $ 37,357 $ - Total investment income 1,237 37,357 - Expenses: * Management and distribution fees 6,083 3,913 1,720 Administration fees 4,861 2,806 1,445 Total expenses 10,944 6,719 3,165 Net Income (Loss) (9,707) 30,638 (3,165) Net Realized and Unrealized Gain (Loss): * Net realized gain (loss) on sale of underlying fund shares 13,263 3, Net unrealized appreciation (depreciation) on underlying fund shares 89,300 (20,187) 13,611 Net realized and unrealized gain (loss) 102,563 (16,931) 14,515 Net increase (decrease) in Net Assets Resulting from Operations 92,856 13,707 11,350 Unit Transactions: ** Contributions Class A 182,666 76,829 19,107 Class B 84,904 27,140 9,243 Class C 75,733 26,939 19,919 Class D Class E Net proceeds from sale of units 343, ,908 48,269 Redemptions Class A (30,683) (21,173) (1,660) Class B (649) (26,267) (599) Class C (27,374) (7,362) (3,004) Class D Class E Total cost of units redeemed (58,706) (54,802) (5,263) Net Increase in Net Assets Derived from Unit Transactions 284,597 76,106 43,006 Net Assets: Total increase in net assets 377,453 89,813 54,356 Beginning of year 881, , ,700 End of year $ 1,258,695 $ 692,508 $ 346,056 * The allocation of income, expenses, realized gain/loss and unrealized gain/loss changed during the year from the outstanding shares methodology to adjusted net asset methodology. ** Includes interportfolio and inferfund transactions

97 Leaders Massachusetts Investors Trust 529 Fund Leaders MFS Research Bond 529 Fund Leaders MFS Total Return 529 Fund Leaders MFS Value 529 Fund Leaders Mutual Shares 529 Fund Leaders Templeton Foreign 529 Fund $ 499 $ 10,427 $ 45,014 $ 21,047 $ 76,521 $ 72, ,427 45,014 21,047 76,521 72, ,263 3,683 2,019 6,143 6, ,814 1,481 4,853 5,156 1,310 2,119 6,497 3,500 10,996 11,964 (811) 8,308 38,517 17,547 65,525 60,216 1,341 (848) 5,523 11,917 11,455 11,398 8,206 (11,788) (24,435) 4,482 44,718 96,358 9,547 (12,636) (18,912) 16,399 56, ,756 8,736 (4,328) 19,605 33, , ,972 12,966 3, ,986 52, , , ,002 28,866 34, ,297 24,349 1,900 43,687 31,352 71, , ,315 5, , , , ,830 (1,923) (386) (13,049) (1,153) (8,247) (18,590) (2) (10,472) (8,815) (23,821) (22,193) (8,563) (5,014) (3,966) (35,587) (54,679) (15,164) (26,628) (6,939) (14,824) (57,451) (79,653) (45,604) (53,781) 30,376 (9,546) 119,224 32, , ,049 39,112 (13,874) 138,829 66, , , , , , , , ,382 $ 154,807 $ 188,936 $ 713,905 $ 375,247 $ 1,259,881 $ 1,435,

98 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Changes in Fiduciary Net Assets (Continued) For the year ended June 30, 2006 SMART529 Select Age-Based DFA Portfolio 0-3 SMART529 Select Age-Based DFA Portfolio 4-6 SMART529 Select Age-Based DFA Portfolio 7-9 Income: * Dividends and capital gains from underlying funds $ 144,949 $ 64,931 $ 53,762 Total investment income 144,949 64,931 53,762 Expenses: * Management and distribution fees Administration fees 17,254 8,280 7,557 Total expenses 17,254 8,280 7,557 Net Income (Loss) 127,695 56,651 46,205 Net Realized and Unrealized Gain (Loss): * Net realized gain (loss) on sale of underlying fund shares 110,318 36,898 72,351 Net unrealized appreciation (depreciation) on underlying fund shares 178,005 56,311 11,856 Net realized and unrealized gain (loss) 288,323 93,209 84,207 Net increase (decrease) in Net Assets Resulting from Operations 416, , ,412 Unit Transactions: ** Contributions Class A Class B Class C Class D Class E 3,646,480 2,574,242 1,584,137 Net proceeds from sale of units 3,646,480 2,574,242 1,584,137 Redemptions Class A Class B Class C Class D Class E (1,158,404) (447,363) (983,764) Total cost of units redeemed (1,158,404) (447,363) (983,764) Net Increase in Net Assets Derived from Unit Transactions 2,488,076 2,126, ,373 Net Assets: Total increase in net assets 2,904,094 2,276, ,785 Beginning of year 1,441, , ,293 End of year $ 4,345,627 $ 2,760,574 $ 1,554,078 * The allocation of income, expenses, realized gain/loss and unrealized gain/loss changed during the year from the outstanding shares methodology to adjusted net asset methodology. ** Includes interportfolio and inferfund transactions

99 SMART529 Select Age-Based DFA Portfolio SMART529 Select Age-Based DFA Portfolio SMART529 Select Age-Based DFA Portfolio SMART529 Select Age-Based DFA Portfolio 19+ SMART529 Select Aggressive Growth DFA Portfolio SMART529 Select Moderately Aggressive Growth DFA Portfolio $ 48,232 $ 35,790 $ 11,295 $ 6,816 $ 134,718 $ 31,823 48,232 35,790 11,295 6, ,718 31, ,820 4,997 1, ,905 3,764 6,820 4,997 1, ,905 3,764 41,412 30,793 9,546 5, ,813 28,059 25,021 10,684 5, ,131 9,604 41,589 18, ,683 37,548 66,610 28,814 5, ,814 47, ,022 59,607 15,046 6, ,627 75, ,490,837 1,365, , ,395 3,480, ,905 2,490,837 1,365, , ,395 3,480, , (444,476) (240,782) (329,122) (187,737) (107,182) (113,937) (444,476) (240,782) (329,122) (187,737) (107,182) (113,937) 2,046,361 1,124, , ,658 3,372, ,968 2,154,383 1,184, , ,722 3,721, , , , ,706 76,421 1,384, ,980 $ 2,518,522 $ 1,673,330 $ 511,152 $ 253,143 $ 5,105,796 $ 1,114,

100 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Statements of Changes in Fiduciary Net Assets (Continued) For the year ended June 30, 2006 SMART529 Select Growth DFA Portfolio SMART529 Select Moderate Growth DFA Portfolio SMART529 Select Balanced DFA Portfolio Income: * Dividends and capital gains from underlying funds $ 89,296 $ 34,965 $ 11,612 Total investment income 89,296 34,965 11,612 Expenses: * Management and distribution fees Administration fees 10,628 4,742 1,717 Total expenses 10,628 4,742 1,717 Net Income (Loss) 78,668 30,223 9,895 Net Realized and Unrealized Gain (Loss): * Net realized gain (loss) on sale of underlying fund shares 13,991 40,077 9,510 Net unrealized appreciation (depreciation) on underlying fund shares 106,943 10,301 (3,559) Net realized and unrealized gain (loss) 120,934 50,378 5,951 Net increase (decrease) in Net Assets Resulting from Operations 199,602 80,601 15,846 Unit Transactions: ** Contributions Class A Class B Class C Class D Class E 2,160, , ,582 Net proceeds from sale of units 2,160, , ,582 Redemptions Class A Class B Class C Class D Class E (73,995) (517,829) (112,922) Total cost of units redeemed (73,995) (517,829) (112,922) Net Increase in Net Assets Derived from Unit Transactions 2,086, , ,660 Net Assets: Total increase in net assets 2,286, , ,506 Beginning of year 898, , ,853 End of year $ 3,185,184 $ 1,171,367 $ 632,359 * The allocation of income, expenses, realized gain/loss and unrealized gain/loss changed during the year from the outstanding shares methodology to adjusted net asset methodology. ** Includes interportfolio and inferfund transactions

101 SMART529 Select Conservative DFA Portfolio SMART529 Select Moderately Conservative DFA Portfolio SMART529 Select All Equity DFA Portfolio SMART529 Select Fixed Income DFA Portfolio SMART529 Select 1-Year Fixed DFA Portfolio $ 1,614 $ 5,368 $ 239,083 $ 9,861 $ 1,117 1,614 5, ,083 9,861 1, ,243 1, ,243 1, ,382 4, ,840 8, ,012 (527) (42) (1,263) (4,277) 401,667 (3,835) 109 (1,154) (3,659) 457,679 (4,362) ,519 3,804 1, , ,301 6,717, ,939 58, , ,301 6,717, ,939 58, (5,365) (5,658) (139,679) (26,164) (10,233) (5,365) (5,658) (139,679) (26,164) (10,233) 143, ,643 6,577, ,775 48, , ,456 7,245, ,579 49,444 5,267 16,110 1,585, ,475 27,754 $ 148,889 $ 504,566 $ 8,830,830 $ 370,054 $ 77,

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103 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s June 30, 2006 SMART529 WV Direct Age-Based Portfolio 0-8 This portfolio had been combined with the Director SMART529 Age-Based Schedule of s as of June 30, 2006 Portfolio 0-8 in prior years. Shares Held s Value Equity Funds % 49,595 The Hartford Capital Appreciation Fund (Class Y) $ 1,946,614 97,054 The Hartford Dividend & Growth Fund (Class Y) 1,940, ,581 The Hartford Global Leaders Fund (Class Y) 1,955,294 75,377 The Hartford MidCap Fund (Class Y) 1,946,989 95,806 The Hartford Stock Fund (Class Y) 1,933,357 Total in Equity Funds ( Cost - $10,025,952 ) % 9,722,355 Total s ( Cost - $10,025,952 ) % 9,722,355 Other Assets Less Liabilities - - 3,245 Net Assets % $ 9,725,600 SMART529 WV Direct Age-Based Portfolio 9-13 This portfolio had been combined with the Director SMART529 Age-Based Schedule of s as of June 30, 2006 Portfolio 9-13 in prior years. Shares Held s Value Equity Funds % 18,897 The Hartford Capital Appreciation Fund (Class Y) $ 741,696 73,958 The Hartford Dividend & Growth Fund (Class Y) 1,478,429 38,323 The Hartford Global Leaders Fund (Class Y) 745,004 28,720 The Hartford MidCap Fund (Class Y) 741,839 73,007 The Hartford Stock Fund (Class Y) 1,473,290 Total in Equity Funds ( Cost - $5,230,023 ) % 5,180,258 Fixed-Income Funds % 213,120 The Hartford Total Return Bond Fund (Class Y) 2,220,710 Total in Fixed Income Funds ( Cost - $2,254,909 ) % 2,220,710 Total s ( Cost - $7,484,932 ) % 7,400,968 Other Assets Less Liabilities Net Assets % $ 7,401,292 SMART529 WV Direct Age-Based Portfolio This portfolio had been combined with the Director SMART529 Age-Based Schedule of s as of June 30, 2006 Portfolio in prior years. Shares Held s Value Equity Funds % 16,332 The Hartford Capital Appreciation Fund (Class Y) $ 641,036 31,960 The Hartford Dividend & Growth Fund (Class Y) 638,889 33,122 The Hartford Global Leaders Fund (Class Y) 643,897 24,822 The Hartford MidCap Fund (Class Y) 641,159 31,549 The Hartford Stock Fund (Class Y) 636,666 Total in Equity Funds ( Cost - $3,173,269 ) % 3,201,647 Fixed-Income Funds % 184,196 The Hartford Total Return Bond Fund (Class Y) 1,919, ,665 SMART529 Stable Value Fund 1,276,024 Total in Fixed Income Funds ( Cost - $3,202,927 ) % 3,195,347 Total s ( Cost - $6,376,196 ) % 6,396,994 Liabilities in Excess of Other Assets - (0.1)% (245) Net Assets % $ 6,396,

104 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 SMART529 WV Direct Age-Based Portfolio 19+ This portfolio had been combined with the Director SMART529 Age-Based Schedule of s as of June 30, 2006 Portfolio 19+ in prior years. Shares Held s Value Equity Funds % 9,554 The Hartford Dividend & Growth Fund (Class Y) $ 190,983 9,431 The Hartford Stock Fund (Class Y) 190,320 Total in Equity Funds ( Cost - $374,560 ) % 381,303 Fixed-Income Funds % 73,415 The Hartford Total Return Bond Fund (Class Y) 764,985 66,162 SMART529 Stable Value Fund 762,884 Total in Fixed Income Funds ( Cost - $1,530,182 ) % 1,527,869 Total s ( Cost - $1,904,742 ) % 1,909,172 Liabilities in Excess of Other Assets - - (36) Net Assets % $ 1,909,136 SMART529 WV Direct Aggressive Growth Portfolio This portfolio had been combined with the Director SMART529 Aggressive Growth Schedule of s as of June 30, 2006 Portfolio in prior years. Shares Held s Value Equity Funds % 63,863 The Hartford Capital Appreciation Fund (Class Y) $ 2,506,627 41,658 The Hartford Dividend & Growth Fund (Class Y) 832,747 43,172 The Hartford Global Leaders Fund (Class Y) 839,268 80,885 The Hartford MidCap Fund (Class Y) 2,089, ,806 The Hartford Stock Fund (Class Y) 2,074,631 Total in Equity Funds ( Cost - $8,419,577 ) % 8,342,532 Total s ( Cost - $8,419,577 ) % 8,342,532 Liabilities in Excess of Other Assets - - (591) Net Assets % $ 8,341,941 SMART529 WV Direct Balanced Portfolio This portfolio had been combined with the Director SMART529 Balanced Schedule of s as of June 30, 2006 Portfolio in prior years. Shares Held s Value Equity Funds % 14,134 The Hartford Capital Appreciation Fund (Class Y) $ 554,745 55,317 The Hartford Dividend & Growth Fund (Class Y) 1,105,780 28,664 The Hartford Global Leaders Fund (Class Y) 557,220 21,481 The Hartford MidCap Fund (Class Y) 554,853 27,303 The Hartford Stock Fund (Class Y) 550,968 Total in Equity Funds ( Cost - $3,064,531 ) % 3,323,566 Fixed-Income Funds % 159,401 The Hartford Total Return Bond Fund (Class Y) 1,660,963 47,884 SMART529 Stable Value Fund 552,131 Total in Fixed Income Funds ( Cost - $2,238,903 ) % 2,213,094 Total s ( Cost - $5,303,434 ) % 5,536,660 Other Assets Less Liabilities Net Assets % $ 5,536,

105 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 SMART529 WV Direct Conservative Balanced Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 362 The Hartford Capital Appreciation Fund (Class Y) $ 14,209 1,417 The Hartford Dividend & Growth Fund (Class Y) 28, The Hartford Global Leaders Fund (Class Y) 14, The Hartford MidCap Fund (Class Y) 14, The Hartford Stock Fund (Class Y) 14,112 Total in Equity Funds ( Cost - $82,061 ) % 85,128 Fixed-Income Funds % 9,527 The Hartford Total Return Bond Fund (Class Y) 99,266 9,704 The Hartford Inflation Plus Fund (Class Y) 99,563 Total in Fixed Income Funds ( Cost - $206,852 ) % 198,829 Total s ( Cost - $288,913 ) % 283,957 Liabilities in Excess of Other Assets - - (3) Net Assets % $ 283,954 SMART529 WV Direct Conservative Bond Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 3,703 The Hartford High Yield Fund (Class Y) $ 28,628 6,980 The Hartford Inflation Plus Fund (Class Y) 71,616 17,817 The Hartford Total Return Bond Fund (Class Y) 185,648 Total in Fixed Income Funds ( Cost - $297,336 ) % 285,892 Total s ( Cost - $297,336 ) % 285,892 Other Assets Less Liabilities - 0.1% 242 Net Assets % $ 286,134 SMART529 WV Direct Growth Portfolio This portfolio had been combined with the Director SMART529 Growth Schedule of s as of June 30, 2006 Portfolio in prior years. Shares Held s Value Equity Funds % 39,025 The Hartford Capital Appreciation Fund (Class Y) $ 1,531,737 38,184 The Hartford Dividend & Growth Fund (Class Y) 763,307 39,572 The Hartford Global Leaders Fund (Class Y) 769,285 59,312 The Hartford MidCap Fund (Class Y) 1,532,034 75,387 The Hartford Stock Fund (Class Y) 1,521,308 Total in Equity Funds ( Cost - $5,857,362 ) % 6,117,671 Fixed-Income Funds % 146,711 The Hartford Total Return Bond Fund (Class Y) 1,528,724 Total in Fixed Income Funds ( Cost - $1,567,598 ) % 1,528,724 Total s ( Cost - $7,424,960 ) % 7,646,395 Liabilities in Excess of Other Assets - - (530) Net Assets % $ 7,645,

106 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 SMART529 WV Direct Stable Value Fund This fund had been combined with the Director SMART529 Stable Value Fund Schedule of s as of June 30, 2006 in prior years. Shares Held s Value Fixed-Income Funds % 229,549 SMART529 Stable Value Fund $ 2,646,820 Total in Fixed Income Funds ( Cost - $2,556,596 ) % 2,646,820 Total s ( Cost - $2,556,596 ) % 2,646,820 Liabilities in Excess of Other Assets - - (928) Net Assets % $ 2,645,892 Director SMART529 Age-Based Portfolio 0-8 This portfolio had been combined with the SMART529 WV Direct Age-Based Schedule of s as of June 30, 2006 Portfolio 0-8 in prior years. Shares Held s Value Equity Funds % 579,908 The Hartford Capital Appreciation Fund (Class Y) $ 22,761,378 1,134,832 The Hartford Dividend & Growth Fund (Class Y) 22,685,302 1,176,075 The Hartford Global Leaders Fund (Class Y) 22,862, ,370 The Hartford MidCap Fund (Class Y) 22,765,775 1,120,241 The Hartford Stock Fund (Class Y) 22,606,466 Total in Equity Funds ( Cost - $100,064,079 ) % 113,681,811 Total s ( Cost - $100,064,079 ) % 113,681,811 Liabilities in Excess of Other Assets - - (18,139) Net Assets % $ 113,663,672 Director SMART529 Age-Based Portfolio 9-13 This portfolio had been combined with the SMART529 WV Direct Age-Based Schedule of s as of June 30, 2006 Portfolio 9-13 in prior years. Shares Held s Value Equity Funds % 209,092 The Hartford Capital Appreciation Fund (Class Y) $ 8,206, ,350 The Hartford Dividend & Growth Fund (Class Y) 16,358, ,046 The Hartford Global Leaders Fund (Class Y) 8,243, ,787 The Hartford MidCap Fund (Class Y) 8,208, ,830 The Hartford Stock Fund (Class Y) 16,302,003 Total in Equity Funds ( Cost - $50,880,084 ) % 57,319,571 Fixed-Income Funds % 2,358,198 The Hartford Total Return Bond Fund (Class Y) 24,572,420 Total in Fixed Income Funds ( Cost - $25,587,573 ) % 24,572,420 Total s ( Cost - $76,467,657 ) % 81,891,991 Liabilities in Excess of Other Assets - - (8,896) Net Assets % $ 81,883,

107 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Director SMART529 Age-Based Portfolio This portfolio had been combined with the SMART529 WV Direct Age-Based Schedule of s as of June 30, 2006 Portfolio in prior years. Shares Held s Value Equity Funds % 177,144 The Hartford Capital Appreciation Fund (Class Y) $ 6,952, ,655 The Hartford Dividend & Growth Fund (Class Y) 6,929, ,254 The Hartford Global Leaders Fund (Class Y) 6,983, ,231 The Hartford MidCap Fund (Class Y) 6,954, ,199 The Hartford Stock Fund (Class Y) 6,905,575 Total in Equity Funds ( Cost - $31,770,245 ) % 34,726,257 Fixed-Income Funds % 1,997,879 The Hartford Total Return Bond Fund (Class Y) 20,817,896 1,200,314 SMART529 Stable Value Fund 13,840,243 Total in Fixed Income Funds ( Cost - $34,740,830 ) % 34,658,139 Total s ( Cost - $66,511,075 ) % 69,384,396 Other Assets Less Liabilities ,341 Net Assets % $ 69,407,737 Director SMART529 Age-Based Portfolio 19+ This portfolio had been combined with the SMART529 WV Direct Age-Based Schedule of s as of June 30, 2006 Portfolio 19+ in prior years. Shares Held s Value Equity Funds % 55,345 The Hartford Dividend & Growth Fund (Class Y) $ 1,106,351 54,634 The Hartford Stock Fund (Class Y) 1,102,508 Total in Equity Funds ( Cost - $2,140,048 ) % 2,208,859 Fixed-Income Funds % 425,290 The Hartford Total Return Bond Fund (Class Y) 4,431, ,272 SMART529 Stable Value Fund 4,419,324 Total in Fixed Income Funds ( Cost - $8,859,157 ) % 8,850,845 Total s ( Cost - $10,999,205 ) % 11,059,704 Liabilities in Excess of Other Assets - - (3,978) Net Assets % $ 11,055,726 Director SMART 529 Aggressive Growth Portfolio This portfolio had been combined with the SMART529 WV Direct Aggressive Growth Schedule of s as of June 30, 2006 Portfolio in prior years. Shares Held s Value Equity Funds % 269,559 The Hartford Capital Appreciation Fund (Class Y) $ 10,580, ,835 The Hartford Dividend & Growth Fund (Class Y) 3,514, ,224 The Hartford Global Leaders Fund (Class Y) 3,542, ,406 The Hartford MidCap Fund (Class Y) 8,818, ,939 The Hartford Stock Fund (Class Y) 8,756,889 Total in Equity Funds ( Cost - $33,264,223 ) % 35,213,004 Total s ( Cost - $33,264,223 ) % 35,213,004 Other Assets Less Liabilities Net Assets % $ 35,213,

108 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Director SMART529 Balanced Portfolio This portfolio had been combined with the SMART529 WV Direct Balanced Schedule of s as of June 30, 2006 Portfolio in prior years. Shares Held s Value Equity Funds % 84,680 The Hartford Capital Appreciation Fund (Class Y) $ 3,323, ,422 The Hartford Dividend & Growth Fund (Class Y) 6,625, ,734 The Hartford Global Leaders Fund (Class Y) 3,338, ,700 The Hartford MidCap Fund (Class Y) 3,324, ,581 The Hartford Stock Fund (Class Y) 3,301,064 Total in Equity Funds ( Cost - $17,587,213 ) % 19,912,712 Fixed-Income Funds % 955,032 The Hartford Total Return Bond Fund (Class Y) 9,951, ,892 SMART529 Stable Value Fund 3,308,016 Total in Fixed Income Funds ( Cost - $13,476,970 ) % 13,259,452 Total s ( Cost - $31,064,183 ) % 33,172,164 Liabilities in Excess of Other Assets - - (12,327) Net Assets % $ 33,159,837 Director SMART529 Growth Portfolio This portfolio had been combined with the SMART529 WV Direct Growth Schedule of s as of June 30, 2006 Portfolio in prior years. Shares Held s Value Equity Funds % 261,321 The Hartford Capital Appreciation Fund (Class Y) $ 10,256, ,691 The Hartford Dividend & Growth Fund (Class Y) 5,111, ,984 The Hartford Global Leaders Fund (Class Y) 5,151, ,167 The Hartford MidCap Fund (Class Y) 10,258, ,806 The Hartford Stock Fund (Class Y) 10,186,993 Total in Equity Funds ( Cost - $36,860,288 ) % 40,965,187 Fixed-Income Funds % 982,403 The Hartford Total Return Bond Fund (Class Y) 10,236,643 Total in Fixed Income Funds ( Cost - $10,646,216 ) % 10,236,643 Total s ( Cost - $47,506,504 ) % 51,201,830 Liabilities in Excess of Other Assets - - (565) Net Assets % $ 51,201,265 Director SMART529 Stable Value Fund This fund had been combined with the SMART529 WV Direct Stable Value Fund Schedule of s as of June 30, 2006 in prior years. Shares Held s Value Fixed-Income Funds % 980,227 SMART529 Stable Value Fund $ 11,302,526 Total in Fixed Income Funds ( Cost - $10,770,745 ) % 11,302,526 Total s ( Cost - $10,770,745 ) % 11,302,526 Other Assets Less Liabilities - - 2,261 Net Assets % $ 11,304,

109 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Director SMART529 The Hartford Advisers 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Balanced Funds % 835,320 The Hartford Advisers Fund (Class Y) $ 13,248,175 Total in Balanced Funds ( Cost - $12,032,710 ) % 13,248,175 Total s ( Cost - $12,032,710 ) % 13,248,175 Liabilities in Excess of Other Assets - - (398) Net Assets % $ 13,247,777 Director SMART 529 The Hartford Capital Appreciation 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 1,436,376 The Hartford Capital Appreciation Fund (Class Y) $ 56,377,757 Total in Equity Funds ( Cost - $44,714,364 ) % 56,377,757 Total s ( Cost - $44,714,364 ) % 56,377,757 Liabilities in Excess of Other Assets - - (1,380) Net Assets % $ 56,376,377 Director SMART529 The Hartford Dividend and Growth 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 1,315,048 The Hartford Dividend & Growth Fund (Class Y) $ 26,287,803 Total in Equity Funds ( Cost - $22,557,016 ) % 26,287,803 Total s ( Cost - $22,557,016 ) % 26,287,803 Liabilities in Excess of Other Assets - - (677) Net Assets % $ 26,287,126 Director SMART529 The Hartford Global Leaders 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 460,086 The Hartford Global Leaders Fund (Class Y) $ 8,944,064 Total in Equity Funds ( Cost - $7,386,390 ) % 8,944,064 Total s ( Cost - $7,386,390 ) % 8,944,064 Liabilities in Excess of Other Assets - - (169) Net Assets % $ 8,943,

110 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Director SMART529 The Hartford High Yield 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 56,048 The Hartford High Yield Fund (Class Y) $ 433,254 Total in Equity Funds ( Cost - $447,674 ) % 433,254 Total s ( Cost - $447,674 ) % 433,254 Liabilities in Excess of Other Assets - - (11) Net Assets % $ 433,243 Director SMART529 The Hartford Inflation Plus 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 74,318 The Hartford Inflation Plus Fund (Class Y) $ 762,503 Total in Equity Funds ( Cost - $802,232 ) % 762,503 Total s ( Cost - $802,232 ) % 762,503 Liabilities in Excess of Other Assets - - (3) Net Assets % $ 762,500 Director SMART529 The Hartford MidCap 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 1,264,865 The Hartford MidCap Fund (Class Y) $ 32,671,456 Total in Equity Funds ( Cost - $27,740,622 ) % 32,671,456 Total s ( Cost - $27,740,622 ) % 32,671,456 Liabilities in Excess of Other Assets - - (736) Net Assets % $ 32,670,720 Director SMART529 The Hartford Money Market 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Money Market Funds % 642,399 The Hartford Money Market Fund (Class Y) $ 642,399 Total in Money Market Funds ( Cost - $642,399 ) % 642,399 Total s ( Cost - $642,399 ) % 642,399 Other Assets Less Liabilities % 2,532 Net Assets % $ 644,

111 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Director SMART529 The Hartford Stock 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 503,619 The Hartford Stock Fund (Class Y) $ 10,163,033 Total in Equity Funds ( Cost - $8,620,826 ) % 10,163,033 Total s ( Cost - $8,620,826 ) % 10,163,033 Other Assets Less Liabilities Net Assets % $ 10,163,250 Director SMART529 The Hartford Total Return Bond 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Fixed-Income Funds % 987,202 The Hartford Total Return Bond Fund (Class Y) $ 10,286,641 Total in Fixed Income Funds ( Cost - $10,801,897 ) % 10,286,641 Total s ( Cost - $10,801,897 ) % 10,286,641 Other Assets Less Liabilities Net Assets % $ 10,286,648 Cornerstone SMART529 Age-Based Portfolio 0-8 Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 63,954 American Mutul Fund (Class F) $ 1,728,673 22,685 Federated Capital Appreciation Fund (Class A) 577,118 37,180 Goldman Sachs CORE U.S. Equity Fund (Class A) 1,151,079 43,477 Goldman Sachs Large Cap Value Fund (Class A) 575,629 36,345 The Hartford Advisers Fund (Class Y) 576,438 44,859 The Hartford MidCap Fund (Class Y) 1,158,701 39,187 Lord Abbett Affiliated Fund (Class A) 577,221 26,466 Lord Abbett Mid-Cap Value Fund (Class A) 578,289 40,551 Putnam International Equity Fund (Class A) 1,168,676 68,746 Putnam Voyager Fund (Class A) 1,149,440 64,867 Van Kampen Comstock Fund (Class A) 1,155,289 28,142 Van Kampen Emerging Growth Fund (Class A) 1,160,556 Total in Equity Funds ( Cost - $10,827,144 ) % 11,557,109 Total s ( Cost - $10,827,144 ) % 11,557,109 Liabilities in Excess of Other Assets - - (252) Net Assets % $ 11,556,

112 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Cornerstone SMART529 Age-Based Portfolio 9-13 Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 42,480 American Mutul Fund (Class F) $ 1,148,233 15,068 Federated Capital Appreciation Fund (Class A) 383,338 28,878 Goldman Sachs Large Cap Value Fund (Class A) 382,349 24,142 The Hartford Advisers Fund (Class Y) 382,886 29,797 The Hartford MidCap Fund (Class Y) 769,646 26,029 Lord Abbett Affiliated Fund (Class A) 383,407 17,580 Lord Abbett Mid-Cap Value Fund (Class A) 384,117 13,468 Putnam International Equity Fund (Class A) 388,139 22,832 Putnam Voyager Fund (Class A) 381,745 21,543 Van Kampen Comstock Fund (Class A) 383,689 9,346 Van Kampen Emerging Growth Fund (Class A) 385,410 Total in Equity Funds ( Cost - $5,111,146 ) % 5,372,959 Fixed-Income Funds % 74,637 Federated Total Return Bond Fund (Class A) 768,012 80,094 Goldman Sachs CORE Fixed Income Fund (Class A) 768,098 99,712 Lord Abbett Bond-Debenture Fund (Class A) 768,779 Total in Fixed Income Funds ( Cost - $2,390,542 ) % 2,304,890 Total s ( Cost - $7,501,688 ) % 7,677,849 Other Assets Less Liabilities - 0.1% 4,190 Net Assets % $ 7,682,039 Cornerstone SMART529 Age-Based Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 19,618 American Mutul Fund (Class F) $ 530,263 10,438 Federated Capital Appreciation Fund (Class A) 265,542 16,723 The Hartford Advisers Fund (Class Y) 265,229 10,320 The Hartford MidCap Fund (Class Y) 266,571 18,031 Lord Abbett Affiliated Fund (Class A) 265,590 15,253 Putnam Equity Income Fund (Class A) 264,637 14,923 Van Kampen Comstock Fund (Class A) 265,785 25,720 Van Kampen Growth and Income Fund (Class A) 531,633 Total in Equity Funds ( Cost - $2,560,317 ) % 2,655,250 Fixed-Income Funds % 77,552 Federated Total Return Bond Fund (Class A) 798,015 18,572 Goldman Sachs Government Income Fund (Class A) 265,947 27,741 Goldman Sachs CORE Fixed Income Fund (Class A) 266,035 34,536 Lord Abbett Bond-Debenture Fund (Class A) 266,270 92,021 SMART529 Stable Value Fund 1,061,052 Total in Fixed Income Funds ( Cost - $2,656,651 ) % 2,657,319 Total s ( Cost - $5,216,968 ) % 5,312,569 Other Assets Less Liabilities - 0.1% 3,197 Net Assets % $ 5,315,

113 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Cornerstone SMART 529 Age-Based Portfolio 19+ Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 1,632 American Mutul Fund (Class F) $ 44,107 2,999 Lord Abbett Affiliated Fund (Class A) 44,182 2,537 Putnam Equity Income Fund (Class A) 44,020 2,483 Van Kampen Comstock Fund (Class A) 44,216 Total in Equity Funds ( Cost - $176,211 ) % 176,525 Fixed-Income Funds % 12,901 Federated Total Return Bond Fund (Class A) 132,755 9,269 Goldman Sachs Government Income Fund (Class A) 132,727 17,973 Putnam Limited Duration Government Income Fund (Class A) 88,428 30,616 SMART529 Stable Value Fund 353,022 Total in Fixed Income Funds ( Cost - $706,606 ) % 706,932 Total s ( Cost - $882,817 ) % 883,457 Other Assets Less Liabilities - 0.1% 1,152 Net Assets % $ 884,609 Cornerstone SMART529 Aggressive Growth Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 2,559 American Mutul Fund (Class F) $ 69,176 3,543 The Hartford Capital Appreciation Fund (Class Y) 139,074 4,363 The Hartford Advisers Fund (Class Y) 69,200 8,078 The Hartford MidCap Fund (Class Y) 208,652 9,409 Lord Abbett Affiliated Fund (Class A) 138,589 3,177 Lord Abbett Mid-Cap Value Fund (Class A) 69,423 4,868 Putnam International Equity Fund (Class A) 140,299 8,253 Putnam Voyager Fund (Class A) 137,988 15,574 Van Kampen Comstock Fund (Class A) 277,381 6,711 Van Kampen Growth and Income Fund (Class A) 138,708 Total in Equity Funds ( Cost - $1,342,031 ) % 1,388,490 Total s ( Cost - $1,342,031 ) % 1,388,490 Liabilities in Excess of Other Assets - - (471) Net Assets % $ 1,388,

114 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Cornerstone SMART529 Balanced Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 10,282 American Mutul Fund (Class F) $ 277,923 10,628 Federated Market Opportunity Fund (Class A) 139,651 4,483 Goldman Sachs CORE U.S. Equity Fund (Class A) 138,789 10,485 Goldman Sachs Large Cap Value Fund (Class A) 138,818 8,765 The Hartford Advisers Fund (Class Y) 139,013 9,450 Lord Abbett Affiliated Fund (Class A) 139,202 6,383 Lord Abbett Mid-Cap Value Fund (Class A) 139,460 7,994 Putnam Equity Income Fund (Class A) 138,693 4,890 Putnam International Equity Fund (Class A) 140,920 15,643 Van Kampen Comstock Fund (Class A) 278,607 Total in Equity Funds ( Cost - $1,578,271 ) % 1,671,076 Fixed-Income Funds % 27,098 Federated Total Return Bond Fund (Class A) 278,839 9,734 Goldman Sachs Government Income Fund (Class A) 139,389 14,540 Goldman Sachs CORE Fixed Income Fund (Class A) 139,435 18,101 Lord Abbett Bond-Debenture Fund (Class A) 139,559 28,313 Putnam Limited Duration Government Income Fund (Class A) 139,302 24,115 SMART529 Stable Value Fund 278,061 Total in Fixed Income Funds ( Cost - $1,128,876 ) % 1,114,585 Total s ( Cost - $2,707,147 ) % 2,785,661 Other Assets Less Liabilities - 0.1% 2,394 Net Assets % $ 2,788,055 Cornerstone SMART529 Conservative Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 1,020 American Mutul Fund (Class F) $ 27,570 2,109 Federated Market Opportunity Fund (Class A) 27,706 1,739 The Hartford Advisers Fund (Class Y) 27,580 1,875 Lord Abbett Affiliated Fund (Class A) 27,617 3,172 Putnam Equity Income Fund (Class A) 55,032 1,552 Van Kampen Comstock Fund (Class A) 27,637 1,337 Van Kampen Growth and Income Fund (Class A) 27,641 Total in Equity Funds ( Cost - $215,345 ) % 220,783 Fixed-Income Funds % 5,376 Federated Total Return Bond Fund (Class A) 55,320 7,725 Goldman Sachs Government Income Fund (Class A) 110,617 11,234 Putnam Limited Duration Government Income Fund (Class A) 55,274 9,569 SMART529 Stable Value Fund 110,331 Total in Fixed Income Funds ( Cost - $332,843 ) % 331,542 Total s ( Cost - $548,188 ) % 552,325 Other Assets Less Liabilities - 0.1% 746 Net Assets % $ 553,

115 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Cornerstone SMART529 Growth Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 16,834 American Mutul Fund (Class F) $ 455,036 7,340 Goldman Sachs CORE U.S. Equity Fund (Class A) 227,236 17,166 Goldman Sachs Large Cap Value Fund (Class A) 227,280 14,351 The Hartford Advisers Fund (Class Y) 227,602 5,827 The Hartford Capital Appreciation Fund (Class Y) 228,707 17,712 The Hartford MidCap Fund (Class Y) 457,503 15,473 Lord Abbett Affiliated Fund (Class A) 227,911 10,450 Lord Abbett Mid-Cap Value Fund (Class A) 228,332 16,011 Putnam International Equity Fund (Class A) 461,439 13,572 Putnam Voyager Fund (Class A) 226,925 25,613 Van Kampen Comstock Fund (Class A) 456,163 11,035 Van Kampen Growth and Income Fund (Class A) 228, ,384 Total in Equity Funds ( Cost - $3,430,867 ) % 3,652,232 Fixed-Income Funds % 22,183 Federated Total Return Bond Fund (Class A) 228,267 88,908 Lord Abbett Bond-Debenture Fund (Class A) 685,478 Total in Fixed Income Funds ( Cost - $941,077 ) % 913,745 Total s ( Cost - $4,371,944 ) % 4,565,977 Other Assets Less Liabilities Net Assets % $ 4,566,722 Cornerstone SMART529 Stable Value Fund Schedule of s as of June 30, 2006 Shares Held s Value Fixed-Income Funds % 68,174 SMART529 Stable Value Fund $ 786,079 Total in Equity Funds ( Cost - $747,610 ) % 786,079 Total s ( Cost - $747,610 ) % 786,079 Liabilities in Excess of Other Assets - - (39) Net Assets % $ 786,040 Cornerstone American Mutual 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 166,314 American Mutul Fund (Class F) $ 4,495,472 Total in Equity Funds ( Cost - $4,180,153 ) % 4,495,472 Total s ( Cost - $4,180,153 ) % 4,495,472 Liabilities in Excess of Other Assets - - (360) Net Assets % $ 4,495,

116 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Cornerstone Federated Capital Appreciation 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 11,248 Federated Capital Appreciation Fund (Class A) $ 286,145 Total in Equity Funds ( Cost - $273,827 ) % 286,145 Total s ( Cost - $273,827 ) % 286,145 Liabilities in Excess of Other Assets - - (11) Net Assets % $ 286,134 Cornerstone Federated Market Opportunity 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 33,070 Federated Market Opportunity Fund (Class A) $ 434,541 Total in Equity Funds ( Cost - $430,963 ) % 434,541 Total s ( Cost - $430,963 ) % 434,541 Liabilities in Excess of Other Assets - - (87) Net Assets % $ 434,454 Cornerstone Federated Total Return Bond 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Fixed-Income Funds % 24,844 Federated Total Return Bond Fund (Class A) $ 255,646 Total in Equity Funds ( Cost - $265,536 ) % 255,646 Total s ( Cost - $265,536 ) % 255,646 Other Assets Less Liabilities - 0.3% 851 Net Assets % $ 256,497 Cornerstone Goldman Sachs Core Fixed Income 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Fixed-Income Funds % 32,625 Goldman Sachs CORE Fixed Income Fund (Class A) $ 312,873 Total in Equity Funds ( Cost - $327,818 ) % 312,873 Total s ( Cost - $327,818 ) % 312,873 Other Assets Less Liabilities - 0.3% 984 Net Assets % $ 313,

117 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Cornerstone Goldman Sachs Government Income 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Fixed-Income Funds % 8,146 Goldman Sachs Government Income Fund (Class A) $ 116,657 Total in Equity Funds ( Cost - $118,909 ) % 116,657 Total s ( Cost - $118,909 ) % 116,657 Other Assets Less Liabilities - 0.4% 413 Net Assets % $ 117,070 Cornerstone Goldman Sachs Large Cap Value 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 33,896 Goldman Sachs Large Cap Value Fund (Class A) $ 448,780 Total in Equity Funds ( Cost - $434,808 ) % 448,780 Total s ( Cost - $434,808 ) % 448,780 Liabilities in Excess of Other Assets - - (10) Net Assets % $ 448,770 Cornerstone Goldman Sachs Structured U.S. Equity 529 Fund Schedule of s as of June 30, 2006 Effective January 1, 2006, the Cornerstone Goldman Sachs Core U.S. Equity 529 Fund changed its name to Cornerstone Goldman Sachs Structured U.S. Equity 529 Fund Shares Held s Value Equity Funds % 7,772 Goldman Sachs CORE U.S. Equity Fund (Class A) $ 240,611 Total in Equity Funds ( Cost - $212,461 ) % 240,611 Total s ( Cost - $212,461 ) % 240,611 Liabilities in Excess of Other Assets - - (73) Net Assets % $ 240,538 Cornerstone The Hartford Advisers 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Balanced Funds % 36,622 The Hartford Advisers Fund (Class Y) $ 580,828 Total in Equity Funds ( Cost - $553,829 ) % 580,828 Total s ( Cost - $553,829 ) % 580,828 Liabilities in Excess of Other Assets - - (106) Net Assets % $ 580,

118 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Cornerstone The Hartford Capital Appreciation 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 187,241 The Hartford Capital Appreciation Fund (Class Y) $ 7,349,209 Total in Equity Funds ( Cost - $6,405,780 ) % 7,349,209 Total s ( Cost - $6,405,780 ) % 7,349,209 Liabilities in Excess of Other Assets - - (158) Net Assets % $ 7,349,051 Cornerstone The Hartford MidCap 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 131,775 The Hartford MidCap Fund (Class Y) $ 3,403,758 Total in Equity Funds ( Cost - $3,136,862 ) % 3,403,758 Total s ( Cost - $3,136,862 ) % 3,403,758 Liabilities in Excess of Other Assets - - (69) Net Assets % $ 3,403,689 Cornerstone Lord Abbett Affiliated 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 319,184 Lord Abbett Affiliated Fund (Class A) $ 4,701,574 Total in Equity Funds ( Cost - $4,420,500 ) % 4,701,574 Total s ( Cost - $4,420,500 ) % 4,701,574 Liabilities in Excess of Other Assets - - (846) Net Assets % $ 4,700,728 Cornerstone Lord Abbett Bond-Debenture 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Fixed-Income Funds % 226,189 Lord Abbett Bond-Debenture Fund (Class A) $ 1,743,920 Total in Equity Funds ( Cost - $1,802,180 ) % 1,743,920 Total s ( Cost - $1,802,180 ) % 1,743,920 Other Assets Less Liabilities Net Assets % $ 1,743,

119 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Cornerstone Lord Abbett MidCap Value 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 184,225 Lord Abbett Mid-Cap Value Fund (Class A) $ 4,025,326 Total in Equity Funds ( Cost - $3,890,814 ) % 4,025,326 Total s ( Cost - $3,890,814 ) % 4,025,326 Liabilities in Excess of Other Assets - - (87) Net Assets % $ 4,025,239 Cornerstone Putnam Equity Income 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 11,248 Putnam Equity Income Fund (Class A) $ 195,148 Total in Equity Funds ( Cost - $191,159 ) % 195,148 Total s ( Cost - $191,159 ) % 195,148 Liabilities in Excess of Other Assets - - (4) Net Assets % $ 195,144 Cornerstone Putnam Limited Duration Government Income 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Fixed-Income Funds % 596 Putnam Limited Duration Government Income Fund (Class A) $ 2,932 Total in Equity Funds ( Cost - $3,033 ) % 2,932 Total s ( Cost - $3,033 ) % 2,932 Other Assets Less Liabilities - 0.3% 8 Net Assets % $ 2,940 Cornerstone Putnam International Equity 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 23,616 Putnam Equity Income Fund (Class A) $ 680,615 Total in Equity Funds ( Cost - $595,229 ) % 680,615 Total s ( Cost - $595,229 ) % 680,615 Liabilities in Excess of Other Assets - - (16) Net Assets % $ 680,

120 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Cornerstone Putnam Voyager 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 8,345 Putnam Voyager Fund (Class A) $ 139,528 Total in Equity Funds ( Cost - $137,048 ) % 139,528 Total s ( Cost - $137,048 ) % 139,528 Liabilities in Excess of Other Assets - - (36) Net Assets % $ 139,492 Cornerstone Van Kampen Comstock 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 260,425 Van Kampen Comstock Fund (Class A) $ 4,638,165 Total in Equity Funds ( Cost - $4,490,084 ) % 4,638,165 Total s ( Cost - $4,490,084 ) % 4,638,165 Other Assets Less Liabilities Net Assets % $ 4,638,311 Cornerstone Van Kampen Emerging Growth 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 10,602 Van Kampen Emerging Growth Fund (Class A) $ 437,219 Total in Equity Funds ( Cost - $409,681 ) % 437,219 Total s ( Cost - $409,681 ) % 437,219 Liabilities in Excess of Other Assets - - (103) Net Assets % $ 437,

121 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Cornerstone Van Kampen Growth and Income 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 101,272 Van Kampen Growth and Income Fund (Class A) $ 2,093,292 Total in Equity Funds ( Cost - $1,956,669 ) % 2,093,292 Total s ( Cost - $1,956,669 ) % 2,093,292 Liabilities in Excess of Other Assets - - (44) Net Assets % $ 2,093,248 Leaders SMART529 Age-Based Portfolio 0-8 Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % - AIM Aggressive Growth Fund (Class A) $ - 26,202 AIM Basic Value Fund (Class A) 905,288 55,284 AIM Constellation Fund (Class A) 1,360,549 50,132 American Mutual Fund (Class F) 1,355,072 80,761 Franklin Capital Growth Fund (Class A) 903,715 47,879 Franklin Small-Mid Cap Growth Fund (Class A) 1,825,146 71,103 Massachusetts Investors Growth Stock Fund (Class A) 902,293 48,549 Massachusetts Investors Trust (Class A) 902,530 68,256 Templeton Foreign Fund (Class A) 918,732 Total in Equity Funds ( Cost - $8,592,438 ) % 9,073,325 Total s ( Cost - $8,592,438 ) % 9,073,325 Liabilities in Excess of Other Assets - - (1,774) Net Assets % $ 9,071,

122 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Leaders SMART529 Age-Based Portfolio 9-13 Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % - AIM Aggressive Growth Fund (Class A) $ - 7,847 AIM Basic Value Fund (Class A) 271,124 22,076 AIM Constellation Fund (Class A) 543,292 30,028 American Mutual Fund (Class F) 811,657 24,187 Franklin Capital Growth Fund (Class A) 270,652 14,339 Franklin Small-Mid Cap Growth Fund (Class A) 546,610 21,294 Massachusetts Investors Growth Stock Fund (Class A) 270,226 14,540 Massachusetts Investors Trust (Class A) 270,301 17,504 MFS Total Return Fund (Class A) 270,608 11,007 Mutual Shares Fund (Class A) 272,193 20,442 Templeton Foreign Fund (Class A) 275,150 Total in Equity Funds ( Cost - $3,604,371 ) % 3,801,813 Fixed-Income Funds % 31,728 Franklin Strategic Income Fund (Class A) 815,208 30,882 MFS Research Bond Fund (Class A) 814,416 Total in Fixed Income Funds ( Cost - $1,683,530 ) % 1,629,624 Total s ( Cost - $5,287,901 ) % 5,431,437 Other Assets Less Liabilities - - 2,621 Net Assets % $ 5,434,058 Leaders SMART529 Age-Based Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 8,276 AIM Constellation Fund (Class A) $ 203,679 13,967 AIM Large Cap Basic Value Fund (Class A) 203,632 15,010 American Mutual Fund (Class F) 405,718 18,135 Franklin Capital Growth Fund (Class A) 202,934 15,966 Massachusetts Investors Growth Stock Fund (Class A) 202,615 10,902 Massachusetts Investors Trust (Class A) 202,664 13,124 MFS Total Return Fund (Class A) 202,901 8,324 MFS Value Fund (Class A) 203,184 8,253 Mutual Shares Fund (Class A) 204,089 Total in Equity Funds ( Cost - $1,945,909 ) % 2,031,416 Fixed-Income Funds % 60,941 Franklin Strategic Income Fund (Class A) 611,239 62,566 MFS Research Bond Fund (Class A) 610,646 70,408 SMART529 Stable Value Fund 811,839 Total in Fixed Income Funds ( Cost - $2,037,221 ) % 2,033,724 Total s ( Cost - $3,983,130 ) % 4,065,140 Other Assets Less Liabilities - 0.1% 2,322 Net Assets % $ 4,067,

123 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Leaders SMART 529 Age-Based Portfolio 19+ Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 2,172 AIM Large Cap Basic Value Fund (Class A) $ 31,673 1,167 American Mutual Fund (Class F) 31,554 1,696 Massachusetts Investors Trust (Class A) 31,523 1,295 MFS Value Fund (Class A) 31,604 Total in Equity Funds ( Cost - $121,071 ) % 126,354 Fixed-Income Funds % 12,639 Franklin Strategic Income Fund (Class A) 126,766 12,976 MFS Research Bond Fund (Class A) 126,644 21,903 SMART529 Stable Value Fund 252,554 Total in Fixed Income Funds ( Cost - $503,939 ) % 505,964 Total s ( Cost - $625,010 ) % 632,318 Other Assets Less Liabilities % 452 Net Assets % $ 632,770 Leaders SMART529 Aggressive Growth Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % - AIM Aggressive Growth Fund (Class A) $ - 22,887 AIM Constellation Fund (Class A) 563,237 10,377 American Mutual Fund (Class F) 280,486 37,613 Franklin Capital Growth Fund (Class A) 420,884 18,582 Franklin Small-Mid Cap Growth Fund (Class A) 708,349 22,076 Massachusetts Investors Growth Stock Fund (Class A) 280,148 15,074 Massachusetts Investors Trust (Class A) 280,218 21,193 Templeton Foreign Fund (Class A) 285,252 Total in Equity Funds ( Cost - $2,636,628 ) % 2,818,574 Total s ( Cost - $2,636,628 ) % 2,818,574 Liabilities in Excess of Other Assets - - (858) Net Assets % $ 2,817,

124 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Leaders SMART529 Balanced Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 4,249 AIM Basic Value Fund (Class A) $ 146,789 5,976 AIM Constellation Fund (Class A) 147,073 10,085 AIM Large Cap Basic Value Fund (Class A) 147,040 10,838 American Mutual Fund (Class F) 292,962 13,095 Franklin Capital Growth Fund (Class A) 146,535 3,882 Franklin Small-Mid Cap Growth Fund, Class A 147,972 11,529 Massachusetts Investors Growth Stock Fund (Class A) 146,305 7,872 Massachusetts Investors Trust (Class A) 146,342 9,477 MFS Total Return Fund (Class A) 146,512 6,010 MFS Value Fund (Class A) 146,716 5,959 Mutual Shares Fund (Class A) 147,370 Total in Equity Funds ( Cost - $1,677,633 ) % 1,761,616 Fixed-Income Funds % 44,005 Franklin Strategic Income Fund (Class A) 441,366 45,178 MFS Research Bond Fund (Class A) 440,938 25,420 SMART529 Stable Value Fund 293,108 Total in Fixed Income Funds ( Cost - $1,195,130 ) % 1,175,412 Total s ( Cost - $2,872,763 ) % 2,937,028 Other Assets Less Liabilities - 0.1% 1,754 Net Assets % $ 2,938,782 Leaders SMART529 Conservative Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 1,333 AIM Basic Value Fund (Class A) $ 46,066 3,165 AIM Large Cap Basic Value Fund (Class A) 46,144 1,701 American Mutual Fund (Class F) 45,969 2,470 Massachusetts Investors Trust (Class A) 45,922 2,974 MFS Total Return Fund (Class A) 45,979 3,772 MFS Value Fund (Class A) 92,085 1,870 Mutual Shares Fund (Class A) 46,248 Total in Equity Funds ( Cost - $353,515 ) % 368,413 Fixed-Income Funds % 18,413 Franklin Strategic Income Fund (Class A) 184,681 18,904 MFS Research Bond Fund (Class A) 184,502 15,955 SMART529 Stable Value Fund 183,968 Total in Fixed Income Funds ( Cost - $555,489 ) % 553,151 Total s ( Cost - $909,004 ) % 921,564 Other Assets Less Liabilities - 0.1% 643 Net Assets % $ 922,

125 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Leaders SMART529 Growth Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % - AIM Aggressive Growth Fund (Class A) $ - 5,663 AIM Basic Value Fund (Class A) 195,669 15,932 AIM Constellation Fund (Class A) 392,093 13,443 AIM Large Cap Basic Value Fund (Class A) 196,002 21,671 American Mutual Fund (Class F) 585,766 17,456 Franklin Capital Growth Fund (Class A) 195,329 15,523 Franklin Small-Mid Cap Growth Fund (Class A) 591,739 15,368 Massachusetts Investors Growth Stock Fund (Class A) 195,021 10,493 Massachusetts Investors Trust (Class A) 195,069 12,632 MFS Total Return Fund (Class A) 195,297 7,943 Mutual Shares Fund (Class A) 196,443 14,753 Templeton Foreign Fund (Class A) 198,581 Total in Equity Funds ( Cost - $2,961,977 ) % 3,137,009 Fixed-Income Funds % 39,105 Franklin Strategic Income Fund (Class A) 392,224 40,148 MFS Research Bond Fund (Class A) 391,842 Total in Fixed Income Funds ( Cost - $814,766 ) % 784,066 Total s ( Cost - $3,776,743 ) % 3,921,075 Other Assets Less Liabilities - 0.1% 2,021 Net Assets % $ 3,923,096 Leaders The SMART529 Stable Value Fund Schedule of s as of June 30, 2006 Shares Held s Value Fixed-Income Funds % 50,632 SMART529 Stable Value Fund $ 583,814 Total in Equity Funds ( Cost - $554,696 ) % 583,814 Total s ( Cost - $554,696 ) % 583,814 Liabilities in Excess of Other Assets - - (97) Net Assets % $ 583,717 Leaders AIM Basic Value 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 15,262 AIM Basic Value Fund (Class A) $ 527,316 Total in Equity Funds ( Cost - $473,825 ) % 527,316 Total s ( Cost - $473,825 ) % 527,316 Liabilities in Excess of Other Assets - - (58) Net Assets % $ 527,

126 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Leaders AIM Constellation 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 24,734 AIM Constellation Fund (Class A) $ 608,700 Total in Equity Funds ( Cost - $606,677 ) % 608,700 Total s ( Cost - $606,677 ) % 608,700 Liabilities in Excess of Other Assets - - (96) Net Assets % $ 608,604 Leaders AIM Large Cap Basic Value 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 22,131 AIM Large Cap Basic Value Fund (Class A) $ 322,667 Total in Equity Funds ( Cost - $286,595 ) % 322,667 Total s ( Cost - $286,595 ) % 322,667 Liabilities in Excess of Other Assets - - (50) Net Assets % $ 322,617 Leaders American Mutual 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 67,778 American Mutual Fund (Class F) $ 1,832,032 Total in Equity Funds ( Cost - $1,711,911 ) % 1,832,032 Total s ( Cost - $1,711,911 ) % 1,832,032 Liabilities in Excess of Other Assets - - (48) Net Assets % $ 1,831,984 Leaders Franklin Capital Growth 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 33,822 Franklin Capital Growth Fund (Class A) $ 378,467 Total in Equity Funds ( Cost - $357,389 ) % 378,467 Total s ( Cost - $357,389 ) % 378,467 Liabilities in Excess of Other Assets - - (72) Net Assets % $ 378,

127 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Leaders Franklin Small-Mid Cap Growth 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 33,020 Franklin Small-Mid Cap Growth Fund (Class A) $ 1,258,729 Total in Equity Funds ( Cost - $1,080,725 ) % 1,258,729 Total s ( Cost - $1,080,725 ) % 1,258,729 Liabilities in Excess of Other Assets - - (34) Net Assets % $ 1,258,695 Leaders Franklin Strategic Income 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Fixed-Income Funds % 69,046 Franklin Strategic Income Fund (Class A) $ 692,528 Total in Equity Funds ( Cost - $709,167 ) % 692,528 Total s ( Cost - $709,167 ) % 692,528 Liabilities in Excess of Other Assets - - (20) Net Assets % $ 692,508 Leaders MFS Massachusetts Investors Growth Stock 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 27,274 Massachusetts Investors Growth Stock Fund (Class A) $ 346,101 Total in Equity Funds ( Cost - $317,493 ) % 346,101 Total s ( Cost - $317,493 ) % 346,101 Liabilities in Excess of Other Assets - - (45) Net Assets % $ 346,056 Leaders Massachusetts Investors Trust 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 8,328 Massachusetts Investors Trust (Class A) $ 154,822 Total in Equity Funds ( Cost - $134,647 ) % 154,822 Total s ( Cost - $134,647 ) % 154,822 Liabilities in Excess of Other Assets - - (15) Net Assets % $ 154,

128 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Leaders MFS Research Bond 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Fixed-Income Funds % 19,275 MFS Research Bond Fund (Class A) $ 188,121 Total in Equity Funds ( Cost - $200,830 ) % 188,121 Total s ( Cost - $200,830 ) % 188,121 Other Assets Less Liabilities - 0.4% 815 Net Assets % $ 188,936 Leaders MFS Total Return 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 46,093 MFS Total Return Fund (Class A) $ 712,598 Total in Equity Funds ( Cost - $715,927 ) % 712,598 Total s ( Cost - $715,927 ) % 712,598 Other Assets Less Liabilities - 0.2% 1,307 Net Assets % $ 713,905 Leaders MFS Value 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 15,375 MFS Value Fund (Class A) $ 375,302 Total in Equity Funds ( Cost - $346,129 ) % 375,302 Total s ( Cost - $346,129 ) % 375,302 Liabilities in Excess of Other Assets - - (55) Net Assets % $ 375,247 Leaders Mutual Shares 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 50,947 Mutual Shares Fund (Class A) $ 1,259,915 Total in Equity Funds ( Cost - $1,139,665 ) % 1,259,915 Total s ( Cost - $1,139,665 ) % 1,259,915 Liabilities in Excess of Other Assets - - (34) Net Assets % $ 1,259,

129 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 Leaders Templeton Foreign 529 Fund Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 106,645 Templeton Foreign Fund (Class A) $ 1,435,443 Total in Equity Funds ( Cost - $1,282,012 ) % 1,435,443 Total s ( Cost - $1,282,012 ) % 1,435,443 Liabilities in Excess of Other Assets - - (40) Net Assets % $ 1,435,403 SMART529 Select Age-Based DFA Portfolio 0-3 Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 109,260 DFA Enhanced U.S. Large Company Portfolio $ 1,077,307 11,357 DFA International Small Cap Value Portfolio 219,191 12,487 DFA International Small Company Portfolio 219,144 21,907 DFA International Value Portfolio 438,366 37,128 DFA U.S. Large Cap Value Portfolio 868,046 41,572 DFA U.S. Micro Cap Portfolio 651,435 29,697 DFA U.S. Small Cap Value Portfolio 872,201 Total in Equity Funds ( Cost - $4,141,575 ) % 4,345,690 Total s ( Cost - $4,141,575 ) % 4,345,690 Liabilities in Excess of Other Assets - - (63) Net Assets % $ 4,345,627 SMART529 Select Age-Based DFA Portfolio 4-6 Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 62,495 DFA Enhanced U.S. Large Company Portfolio $ 616,199 6,496 DFA International Small Cap Value Portfolio 125,374 7,142 DFA International Small Company Portfolio 125,347 12,531 DFA International Value Portfolio 250,739 21,236 DFA U.S. Large Cap Value Portfolio 496,508 23,779 DFA U.S. Micro Cap Portfolio 372,610 16,986 DFA U.S. Small Cap Value Portfolio 498,886 Total in Equity Funds ( Cost - $2,419,976 ) % 2,485,663 Fixed-Income Funds % 13,321 DFA Five -Year Global Income Portfolio 137,211 12,542 DFA Intermediate Government Fixed Income Portfolio 137,587 Total in Fixed Income Funds ( Cost - $279,216 ) % 274,798 Total s ( Cost - $2,699,192 ) % 2,760,461 Other Assets Less Liabilities Net Assets % $ 2,760,

130 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 SMART529 Select Age-Based DFA Portfolio 7-9 Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 31,289 DFA Enhanced U.S. Large Company Portfolio $ 308,504 3,252 DFA International Small Cap Value Portfolio 62,769 3,576 DFA International Small Company Portfolio 62,756 6,274 DFA International Value Portfolio 125,534 10,632 DFA U.S. Large Cap Value Portfolio 248,580 11,905 DFA U.S. Micro Cap Portfolio 186,550 8,504 DFA U.S. Small Cap Value Portfolio 249,771 Total in Equity Funds ( Cost - $1,210,834 ) % 1,244,464 Fixed-Income Funds % 7,503 DFA Five -Year Global Income Portfolio 77,283 14,128 DFA Intermediate Government Fixed Income Portfolio 154,989 7,767 DFA Two -Year Global Income Portfolio 77,283 Total in Fixed Income Funds ( Cost - $312,623 ) % 309,555 Total s ( Cost - $1,523,457 ) % 1,554,019 Other Assets Less Liabilities Net Assets % $ 1,554,078 SMART529 Select Age-Based DFA Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 41,233 DFA Enhanced U.S. Large Company Portfolio $ 406,562 4,286 DFA International Small Cap Value Portfolio 82,720 4,712 DFA International Small Company Portfolio 82,702 8,268 DFA International Value Portfolio 165,435 14,012 DFA U.S. Large Cap Value Portfolio 327,590 15,689 DFA U.S. Micro Cap Portfolio 245,843 11,207 DFA U.S. Small Cap Value Portfolio 329,159 Total in Equity Funds ( Cost - $1,583,258 ) % 1,640,011 Fixed-Income Funds % 24,340 DFA Five -Year Global Income Portfolio 250,699 34,375 DFA Intermediate Government Fixed Income Portfolio 377,088 12,350 DFA One -Year Global Income Portfolio 125,473 12,598 DFA Two -Year Global Income Portfolio 125,349 Total in Fixed Income Funds ( Cost - $887,664 ) % 878,609 Total s ( Cost - $2,470,922 ) % 2,518,620 Liabilities in Excess of Other Assets - - (98) Net Assets % $ 2,518,

131 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 SMART529 Select Age-Based DFA Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 21,091 DFA Enhanced U.S. Large Company Portfolio $ 207,953 2,192 DFA International Small Cap Value Portfolio 42,311 2,410 DFA International Small Company Portfolio 42,302 4,229 DFA International Value Portfolio 84,618 7,167 DFA U.S. Large Cap Value Portfolio 167,559 8,025 DFA U.S. Micro Cap Portfolio 125,747 5,732 DFA U.S. Small Cap Value Portfolio 168,362 Total in Equity Funds ( Cost - $805,680 ) % 838,852 Fixed-Income Funds % 16,184 DFA Five -Year Global Income Portfolio 166,699 30,475 DFA Intermediate Government Fixed Income Portfolio 334,313 16,424 DFA One -Year Global Income Portfolio 166,867 16,754 DFA Two -Year Global Income Portfolio 166,699 Total in Fixed Income Funds ( Cost - $844,144 ) % 834,578 Total s ( Cost - $1,649,824 ) % 1,673,430 Liabilities in Excess of Other Assets - - (100) Net Assets % $ 1,673,330 SMART529 Select Age-Based DFA Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 4,513 DFA Enhanced U.S. Large Company Portfolio $ 44, DFA International Small Cap Value Portfolio 9, DFA International Small Company Portfolio 9, DFA International Value Portfolio 18,108 1,534 DFA U.S. Large Cap Value Portfolio 35,858 1,717 DFA U.S. Micro Cap Portfolio 26,910 1,227 DFA U.S. Small Cap Value Portfolio 36,030 Total in Equity Funds ( Cost - $176,919 ) % 179,515 Fixed-Income Funds % 7,422 DFA Five -Year Global Income Portfolio 76,444 11,646 DFA Intermediate Government Fixed Income Portfolio 127,756 7,531 DFA One -Year Global Income Portfolio 76,520 5,122 DFA Two -Year Global Income Portfolio 50,963 Total in Fixed Income Funds ( Cost - $333,353 ) % 331,683 Total s ( Cost - $510,272 ) % 511,198 Liabilities in Excess of Other Assets - - (46) Net Assets % $ 511,

132 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 SMART529 Select Age-Based DFA Portfolio 19+ Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 1,278 DFA Enhanced U.S. Large Company Portfolio $ 12, DFA International Small Cap Value Portfolio 2, DFA International Small Company Portfolio 2, DFA International Value Portfolio 5, DFA U.S. Large Cap Value Portfolio 10, DFA U.S. Micro Cap Portfolio 7, DFA U.S. Small Cap Value Portfolio 10,204 Total in Equity Funds ( Cost - $49,434 ) % 50,842 Fixed-Income Funds % 4,905 DFA Five -Year Global Income Portfolio 50,517 6,926 DFA Intermediate Government Fixed Income Portfolio 75,983 4,977 DFA One -Year Global Income Portfolio 50,566 2,539 DFA Two -Year Global Income Portfolio 25,258 Total in Fixed Income Funds ( Cost - $203,299 ) % 202,324 Total s ( Cost - $252,733 ) % 253,166 Liabilities in Excess of Other Assets - - (23) Net Assets % $ 253,143 SMART529 Select Aggressive Growth DFA Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 128,373 DFA Enhanced U.S. Large Company Portfolio $ 1,265,757 13,344 DFA International Small Cap Value Portfolio 257,533 14,671 DFA International Small Company Portfolio 257,478 25,740 DFA International Value Portfolio 515,049 43,622 DFA U.S. Large Cap Value Portfolio 1,019,892 48,844 DFA U.S. Micro Cap Portfolio 765,389 34,892 DFA U.S. Small Cap Value Portfolio 1,024,774 Total in Equity Funds ( Cost - $4,884,583 ) % 5,105,872 Total s ( Cost - $4,884,583 ) % 5,105,872 Liabilities in Excess of Other Assets - - (76) Net Assets % $ 5,105,

133 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 SMART529 Select Moderately Aggressive Growth DFA Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 25,220 DFA Enhanced U.S. Large Company Portfolio $ 248,668 2,621 DFA International Small Cap Value Portfolio 50,595 2,882 DFA International Small Company Portfolio 50,584 5,057 DFA International Value Portfolio 101,186 8,570 DFA U.S. Large Cap Value Portfolio 200,366 9,596 DFA U.S. Micro Cap Portfolio 150,367 6,855 DFA U.S. Small Cap Value Portfolio 201,326 Total in Equity Funds ( Cost - $958,154 ) % 1,003,092 Fixed-Income Funds % 5,376 DFA Five -Year Global Income Portfolio 55,372 5,061 DFA Intermediate Government Fixed Income Portfolio 55,523 Total in Fixed Income Funds ( Cost - $113,120 ) % 110,895 Total s ( Cost - $1,071,274 ) % 1,113,987 Other Assets Less Liabilities Net Assets % $ 1,114,159 SMART529 Growth DFA Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 64,124 DFA Enhanced U.S. Large Company Portfolio $ 632,264 6,665 DFA International Small Cap Value Portfolio 128,642 7,328 DFA International Small Company Portfolio 128,615 12,857 DFA International Value Portfolio 257,275 21,790 DFA U.S. Large Cap Value Portfolio 509,451 24,398 DFA U.S. Micro Cap Portfolio 382,323 17,429 DFA U.S. Small Cap Value Portfolio 511,891 Total in Equity Funds ( Cost - $2,420,196 ) % 2,550,461 Fixed-Income Funds % 15,377 DFA Five -Year Global Income Portfolio 158,386 28,955 DFA Intermediate Government Fixed Income Portfolio 317,642 15,919 DFA Two -Year Global Income Portfolio 158,392 Total in Fixed Income Funds ( Cost - $646,476 ) % 634,420 Total s ( Cost - $3,066,672 ) % 3,184,881 Other Assets Less Liabilities Net Assets % $ 3,185,

134 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 SMART529 Select Moderate Growth DFA Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 19,177 DFA Enhanced U.S. Large Company Portfolio $ 189,080 1,993 DFA International Small Cap Value Portfolio 38,471 2,192 DFA International Small Company Portfolio 38,463 3,845 DFA International Value Portfolio 76,940 6,516 DFA U.S. Large Cap Value Portfolio 152,354 7,296 DFA U.S. Micro Cap Portfolio 114,336 5,212 DFA U.S. Small Cap Value Portfolio 153,084 Total in Equity Funds ( Cost - $739,720 ) % 762,728 Fixed-Income Funds % 11,320 DFA Five -Year Global Income Portfolio 116,594 15,986 DFA Intermediate Government Fixed Income Portfolio 175,370 5,744 DFA One -Year Global Income Portfolio 58,354 5,859 DFA Two -Year Global Income Portfolio 58,297 Total in Fixed Income Funds ( Cost - $412,773 ) % 408,615 Total s ( Cost - $1,152,493 ) % 1,171,343 Other Assets Less Liabilities Net Assets % $ 1,171,367 SMART529 Select Balanced DFA Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 7,970 DFA Enhanced U.S. Large Company Portfolio $ 78, DFA International Small Cap Value Portfolio 15, DFA International Small Company Portfolio 15,986 1,598 DFA International Value Portfolio 31,978 2,708 DFA U.S. Large Cap Value Portfolio 63,321 3,033 DFA U.S. Micro Cap Portfolio 47,520 2,166 DFA U.S. Small Cap Value Portfolio 63,625 Total in Equity Funds ( Cost - $315,805 ) % 317,006 Fixed-Income Funds % 6,116 DFA Five -Year Global Income Portfolio 62,997 11,517 DFA Intermediate Government Fixed Income Portfolio 126,338 6,207 DFA One -Year Global Income Portfolio 63,058 6,331 DFA Two -Year Global Income Portfolio 62,996 Total in Fixed Income Funds ( Cost - $317,319 ) % 315,389 Total s ( Cost - $633,124 ) % 632,395 Liabilities in Excess of Other Assets - - (36) Net Assets % $ 632,

135 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 SMART529 Select Conservative DFA Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 752 DFA Enhanced U.S. Large Company Portfolio $ 7, DFA International Small Cap Value Portfolio 1, DFA International Small Company Portfolio 1, DFA International Value Portfolio 3, DFA U.S. Large Cap Value Portfolio 5, DFA U.S. Micro Cap Portfolio 4, DFA U.S. Small Cap Value Portfolio 6,001 Total in Equity Funds ( Cost - $30,701 ) % 29,900 Fixed-Income Funds % 2,884 DFA Five -Year Global Income Portfolio 29,710 4,074 DFA Intermediate Government Fixed Income Portfolio 44,687 2,927 DFA One -Year Global Income Portfolio 29,739 1,493 DFA Two -Year Global Income Portfolio 14,855 Total in Fixed Income Funds ( Cost - $119,363 ) % 118,991 Total s ( Cost - $150,064 ) % 148,891 Liabilities in Excess of Other Assets - - (2) Net Assets % $ 148,889 SMART529 Select Moderately Conservative DFA Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 4,455 DFA Enhanced U.S. Large Company Portfolio $ 43, DFA International Small Cap Value Portfolio 8, DFA International Small Company Portfolio 8, DFA International Value Portfolio 17,874 1,514 DFA U.S. Large Cap Value Portfolio 35,394 1,695 DFA U.S. Micro Cap Portfolio 26,562 1,211 DFA U.S. Small Cap Value Portfolio 35,564 Total in Equity Funds ( Cost - $179,821 ) % 177,193 Fixed-Income Funds % 7,326 DFA Five -Year Global Income Portfolio 75,455 11,495 DFA Intermediate Government Fixed Income Portfolio 126,104 7,434 DFA One -Year Global Income Portfolio 75,530 5,056 DFA Two -Year Global Income Portfolio 50,304 Total in Fixed Income Funds ( Cost - $328,814 ) % 327,393 Total s ( Cost - $508,635 ) % 504,586 Liabilities in Excess of Other Assets - - (20) Net Assets % $ 504,

136 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Schedules of s (Continued) June 30, 2006 SMART529 Select All Equity DFA Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 17,289 DFA Emerging Markets Value Portfolio $ 446, ,441 DFA Enhanced U.S. Large Company Portfolio 1,749,569 23,056 DFA International Small Cap Value Portfolio 444,982 25,350 DFA International Small Company Portfolio 444,885 44,474 DFA International Value Portfolio 889,918 75,371 DFA U.S. Large Cap Value Portfolio 1,762,162 84,393 DFA U.S. Micro Cap Portfolio 1,322,432 60,286 DFA U.S. Small Cap Value Portfolio 1,770,613 Total in Equity Funds ( Cost - $8,400,515 ) % 8,830,963 Total s ( Cost - $8,400,515 ) % 8,830,963 Liabilities in Excess of Other Assets - - (133) Net Assets % $ 8,830,830 SMART529 Select Fixed Income DFA Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Equity Funds % 7,290 DFA Five -Year Global Income Portfolio $ 74,067 7,437 DFA One -Year Global Income Portfolio 73,995 21,553 DFA Two -Year Global Income Portfolio 221,998 Total in Fixed Income Funds ( Cost - $373,110 ) % 370,060 Total s ( Cost - $373,110 ) % 370,060 Liabilities in Excess of Other Assets - - (6) Net Assets % $ 370,054 SMART529 Select 1 Year Fixed DFA Portfolio Schedule of s as of June 30, 2006 Shares Held s Value Fixed-Income Funds % 7,598 DFA One Year Fixed Income Portfolio $ 77,199 Total in Fixed Income Funds ( Cost - $77,089 ) % 77,199 Total s ( Cost - $77,089 ) % 77,199 Liabilities in Excess of Other Assets - - (1) Net Assets % $ 77,

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138 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations SMART529 WV Direct Age-Based Portfolio 0-8 * From July 1, 2005 through June 30, 2006 Class D $ $ 0.11 $ 1.67 $ 1.78 SMART529 WV Direct Age-Based Portfolio 9-13 * From July 1, 2005 through June 30, 2006 Class D $ $ 0.21 $ 0.87 $ 1.08 SMART529 WV Direct Age-Based Portfolio * From July 1, 2005 through June 30, 2006 Class D $ $ 0.16 $ 0.72 $ 0.88 SMART529 WV Direct Age-Based Portfolio 19+ * From July 1, 2005 through June 30, 2006 Class D $ $ 0.14 $ 0.20 $ 0.34 SMART529 WV Direct Aggressive Growth Portfolio * From July 1, 2005 through June 30, 2006 Class D $ $ 0.09 $ 1.77 $ 1.86 SMART529 WV Direct Balanced Portfolio * From July 1, 2005 through June 30, 2006 Class D $ $ 0.20 $ 0.77 $ 0.97 SMART529 WV Direct Conservative Balanced Portfolio From July 1, 2005 through June 30, 2006 Class D $ $ 0.26 $ 0.02 $ 0.28 From July 1, 2004 through June 30, 2005 Class D From inception March 31, 2004 through June 30, 2004 Class D (0.21) (0.15) SMART529 WV Direct Conservative Bond Portfolio From July 1, 2005 through June 30, 2006 Class D $ $ 0.44 $ (0.56) $ (0.12) From July 1, 2004 through June 30, 2005 Class D From March 31, 2004 through June 30, 2004 Class D (0.35) (0.26) SMART529 WV Direct Growth Portfolio * From July 1, 2005 through June 30, 2006 Class D $ $ 0.19 $ 1.22 $ 1.41 (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued. * The SMART529 WV Direct and the Director SMART529 groups of portfolios and funds with similar names had been combined in fiscal years prior to the current fiscal year. For example, SMART529 WV Direct Age-Based Portfolio 0-8 had been combined with Director SMART529 Age-Based Portfolio 0-8, SMART529 WV Direct Age-Based Portfolio 9-13 with Director SMART529 Age-Based 9-13, and so on

139 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 9, % 0.88 % 15 % $ % $ 7, % 2.13 % 14 % $ % $ 6, % 1.65 % 13 % $ % $ 1, % 1.58 % 22 % $ % $ 8, % 0.75 % 22 % $ % $ 5, % 1.76 % 12 % $ % $ % 3.18 % 30 % (1.53) $ (1.12) % $ % 4.71 % 60 % (2.56) $ % $ 7, % 1.66 % 11 %

140 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations SMART529 WV Direct Stable Value Fund * From July 1, 2005 through June 30, 2006 Class D $ $ (0.10) $ 0.46 $ 0.36 Director SMART529 Age-Based Portfolio 0-8 * From July 1, 2005 through June 30, 2006 Class A $ $ 0.07 $ 1.67 $ 1.74 Class B Class C (0.02) Class E From July 1, 2004 through June 30, 2005 Class A Class B Class C (0.01) Class D and E From July 1, 2003 through June 30, 2004 Class A 9.33 (0.02) Class B 9.26 (0.05) Class C 9.24 (0.07) Class D and E From July 1, 2002 through June 30, 2003 Class A 9.28 (0.01) Class B (4) 9.08 (0.02) Class C 9.26 (0.04) 0.02 (0.02) Class D and E From inception March 1, 2002 through June 30, 2002 Class A (0.90) (0.90) Class C (0.01) (0.91) (0.92) Class D and E (0.90) (0.90) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued. (4) Class B shares from inception July 2, 2002, through June 30, * The SMART529 WV Direct and the Director SMART529 groups of portfolios and funds with similar names had been combined in fiscal years prior to the current fiscal year. For example, SMART529 WV Direct Age-Based Portfolio 0-8 had been combined with Director SMART529 Age-Based Portfolio 0-8, SMART529 WV Direct Age-Based Portfolio 9-13 with Director SMART529 Age-Based 9-13, and so on

141 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 2, % (1.05) % 24 % $ % $ 59, % 0.52 % 15 % , , (0.12) , , , , (0.13) , , (0.28) , (0.78) , (0.98) , , (0.20) , (0.60) (0.15) 4, (0.84) , (8.88) 2, (0.20) (9.05) 1, (0.93) (8.80) 1,

142 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Director SMART529 Age-Based Portfolio 9-13 * From July 1, 2005 through June 30, 2006 Class A $ $ 0.19 $ 0.85 $ 1.04 Class B Class C Class E From July 1, 2004 through June 30, 2005 Class A Class B Class C Class D and E From July 1, 2003 through June 30, 2004 Class A Class B Class C Class D and E From July 1, 2002 through June 30, 2003 Class A Class B (4) Class C Class D and E From inception March 1, 2002 through June 30, 2002 Class A (0.65) (0.63) Class C (0.67) (0.65) Class D and E (0.66) (0.62) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued. (4) Class B shares from inception July 2, 2002, through June 30, * The SMART529 WV Direct and the Director SMART529 groups of portfolios and funds with similar names had been combined in fiscal years prior to the current fiscal year. For example, SMART529 WV Direct Age-Based Portfolio 0-8 had been combined with Director SMART529 Age-Based Portfolio 0-8, SMART529 WV Direct Age-Based Portfolio 9-13 with Director SMART529 Age-Based 9-13, and so on

143 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 39, % 1.61 % 14 % , , , , , , , , , , , , , , , (6.20) 2, (6.38) 1, (6.12) 1,

144 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Director SMART529 Age-Based Portfolio * From July 1, 2005 through June 30, 2006 Class A $ $ 0.14 $ 0.71 $ 0.85 Class B Class C Class E From July 1, 2004 through June 30, 2005 Class A Class B Class C Class D and E From July 1, 2003 through June 30, 2004 Class A Class B Class C Class D and E From July 1, 2002 through June 30, 2003 Class A Class B (4) Class C Class D and E From inception March 1, 2002 through June 30, 2002 Class A (0.41) (0.39) Class C (0.43) (0.41) Class D and E (0.41) (0.38) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued. (4) Class B shares from inception July 2, 2002, through June 30, * The SMART529 WV Direct and the Director SMART529 groups of portfolios and funds with similar names had been combined in fiscal years prior to the current fiscal year. For example, SMART529 WV Direct Age-Based Portfolio 0-8 had been combined with Director SMART529 Age-Based Portfolio 0-8, SMART529 WV Direct Age-Based Portfolio 9-13 with Director SMART529 Age-Based 9-13, and so on

145 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 34, % 1.20 % 13 % , , , , , , , , , , , , , , (3.84) 1, (4.02) (3.76)

146 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Director SMART529 Age-Based Portfolio 19+ * From July 1, 2005 through June 30, 2006 Class A $ $ 0.11 $ 0.19 $ 0.30 Class B Class C Class E From July 1, 2004 through June 30, 2005 Class A Class B Class C Class D and E From July 1, 2003 through June 30, 2004 Class A Class B (0.04) Class C Class D and E From July 1, 2002 through June 30, 2003 Class A Class B (4) Class C Class D and E From inception March 1, 2002 through June 30, 2002 Class A (0.17) (0.15) Class C (0.20) (0.17) Class D and E (0.20) (0.15) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued. (4) Class B shares from inception July 2, 2002, through June 30, * The SMART529 WV Direct and the Director SMART529 groups of portfolios and funds with similar names had been combined in fiscal years prior to the current fiscal year. For example, SMART529 WV Direct Age-Based Portfolio 0-8 had been combined with Director SMART529 Age-Based Portfolio 0-8, SMART529 WV Direct Age-Based Portfolio 9-13 with Director SMART529 Age-Based 9-13, and so on

147 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 5, % 1.24 % 22 % , , , , , , (1.52) (1.70) (1.43)

148 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Director SMART529 Aggressive Growth Portfolio * From July 1, 2005 through June 30, 2006 Class A $ $ 0.05 $ 1.77 $ 1.82 Class B (0.01) Class C (0.04) Class E From July 1, 2004 through June 30, 2005 Class A Class B (0.01) Class C (0.03) Class D and E From July 1, 2003 through June 30, 2004 Class A Class B 9.26 (0.07) Class C 9.24 (0.11) Class D and E From July 1, 2002 through June 30, 2003 Class A 9.19 (0.02) Class B (4) 8.97 (0.04) Class C 9.17 (0.06) Class D and E From inception March 1, 2002 through June 30, 2002 Class A (0.98) (0.98) Class C (0.01) (0.99) (1.00) Class D and E (0.98) (0.98) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued. (4) Class B shares from inception July 2, 2002, through June 30, * The SMART529 WV Direct and the Director SMART529 groups of portfolios and funds with similar names had been combined in fiscal years prior to the current fiscal year. For example, SMART529 WV Direct Age-Based Portfolio 0-8 had been combined with Director SMART529 Age-Based Portfolio 0-8, SMART529 WV Direct Age-Based Portfolio 9-13 with Director SMART529 Age-Based 9-13, and so on

149 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 15, % 0.40 % 22 % , (0.10) , (0.29) , , , (0.11) , (0.27) , , (0.43) , (0.93) , (1.13) , (0.14) , (0.37) (0.81) , (1.01) , (0.10) (9.70) (0.42) (9.87) (1.11) (9.63) (0.16)

150 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Director SMART529 Balanced Portfolio * From July 1, 2005 through June 30, 2006 Class A $ $ 0.16 $ 0.77 $ 0.93 Class B Class C Class E From July 1, 2004 through June 30, 2005 Class A Class B Class C Class D and E From July 1, 2003 through June 30, 2004 Class A Class B Class C Class D and E From July 1, 2002 through June 30, 2003 Class A Class B (4) Class C Class D and E From inception March 1, 2002 through June 30, 2002 Class A (0.49) (0.47) Class C (0.51) (0.49) Class D and E (0.50) (0.46) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued. (4) Class B shares from inception July 2, 2002, through June 30, * The SMART529 WV Direct and the Director SMART529 groups of portfolios and funds with similar names had been combined in fiscal years prior to the current fiscal year. For example, SMART529 WV Direct Age-Based Portfolio 0-8 had been combined with Director SMART529 Age-Based Portfolio 0-8, SMART529 WV Direct Age-Based Portfolio 9-13 with Director SMART529 Age-Based 9-13, and so on

151 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 18, % 1.26 % 12 % , , , , , , , , , , , , , , , (4.64) 1, (4.81) (4.55)

152 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Director SMART529 Growth Portfolio * From July 1, 2005 through June 30, 2006 Class A $ $ 0.14 $ 1.23 $ 1.37 Class B Class C Class E From July 1, 2004 through June 30, 2005 Class A Class B Class C Class D and E From July 1, 2003 through June 30, 2004 Class A Class B Class C Class D and E From July 1, 2002 through June 30, 2003 Class A Class B (4) Class C Class D and E From inception March 1, 2002 through June 30, 2002 Class A (0.74) (0.73) Class C (0.75) (0.75) Class D and E (0.74) (0.72) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued. (4) Class B shares from inception July 2, 2002, through June 30, * The SMART529 WV Direct and the Director SMART529 groups of portfolios and funds with similar names had been combined in fiscal years prior to the current fiscal year. For example, SMART529 WV Direct Age-Based Portfolio 0-8 had been combined with Director SMART529 Age-Based Portfolio 0-8, SMART529 WV Direct Age-Based Portfolio 9-13 with Director SMART529 Age-Based 9-13, and so on

153 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 26, % 1.15 % 11 % , , , , , , , , , , , , , , , (7.19) 1, (7.36) (7.11)

154 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Director SMART529 Stable Value Fund * From July 1, 2005 through June 30, 2006 Class A $ $ (0.13) $ 0.46 $ 0.33 Class B (0.16) Class C (0.21) Class E (0.10) From July 1, 2004 through June 30, 2005 Class A (0.13) Class B (0.18) Class C (0.19) Class D and E (0.10) From July 1, 2003 through June 30, 2004 Class A (0.10) Class B (0.17) Class C (0.15) Class D and E (0.09) From inception September 16, 2002 through June 30, 2003 Class A (0.07) Class B (0.08) Class C (0.08) Class D and E (0.04) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued. * The SMART529 WV Direct and the Director SMART529 groups of portfolios and funds with similar names had been combined in fiscal years prior to the current fiscal year. For example, SMART529 WV Direct Age-Based Portfolio 0-8 had been combined with Director SMART529 Age-Based Portfolio 0-8, SMART529 WV Direct Age-Based Portfolio 9-13 with Director SMART529 Age-Based 9-13, and so on

155 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 3, % (1.36) % 24 % , (1.86) , (2.05) , (1.06) , (1.36) , (1.86) , (2.05) , (1.06) , (1.38) , (1.88) , (2.07) , (1.08) , (1.30) , (1.75) , (1.92) , (1.04)

156 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Director SMART529 The Hartford Advisers 529 Fund From July 1, 2005 through June 30, 2006 Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Class A $ $ 0.15 $ 0.48 $ 0.63 Class B Class C Class E From July 1, 2004 through June 30, 2005 Class A Class B Class C Class D and E From July 1, 2003 through June 30, 2004 Class A Class B Class C Class D and E From July 1, 2002 through June 30, 2003 Class A Class B (4) Class C Class D and E From inception March 1, 2002 through June 30, 2002 Class A (0.98) (0.94) Class C (0.99) (0.96) Class D and E (1.01) (0.94) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued. (4) Class B shares from inception July 2, 2002, through June 30,

157 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 7, % 1.33 % 5 % , , , , , , , , , , (9.36) 1, (9.53) (9.29)

158 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Selected Per-Share Data (Rounded) Net Asset Value at Beginning of Period Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Director SMART529 The Hartford Capital Appreciation 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ (0.03) $ 2.68 $ 2.65 Class B (0.09) Class C (0.12) Class E From July 1, 2004 through June 30, 2005 Class A (0.08) Class B (0.13) Class C (0.15) Class D and E (0.04) From July 1, 2003 through June 30, 2004 Class A 9.39 (0.03) Class B 9.33 (0.06) Class C 9.31 (0.07) Class D and E 9.43 (0.02) From July 1, 2002 through June 30, 2003 Class A 8.90 (0.03) Class B (4) 8.67 (0.04) Class C 8.89 (0.07) Class D and E 8.91 (0.01) From inception March 1, 2002 through June 30, 2002 Class A (0.01) (1.26) (1.27) Class C (0.02) (1.26) (1.28) Class D and E (0.01) (1.25) (1.26) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued. (4) Class B shares from inception July 2, 2002, through June 30,

159 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 29, % (0.19) % 1 % , (0.68) , (0.87) , , (0.66) , (1.16) , (1.35) , (0.36) , (0.61) , (1.11) , (1.30) , (0.30) , (0.57) , (1.01) , (1.20) , (0.29) (12.44) 1, (0.69) (12.60) (1.38) (12.37) (0.40)

160 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Selected Per-Share Data (Rounded) Net Asset Value at Beginning of Period Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Director SMART529 The Hartford Dividend and Growth 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.17 $ 1.18 $ 1.35 Class B Class C Class E From July 1, 2004 through June 30, 2005 Class A Class B Class C Class D and E From July 1, 2003 through June 30, 2004 Class A Class B Class C 9.10 (0.01) Class D and E From July 1, 2002 through June 30, 2003 Class A (0.31) (0.26) Class B (4) (0.20) (0.17) Class C (0.33) (0.32) Class D and E (0.29) (0.23) From inception March 1, 2002 through June 30, 2002 Class A (0.77) (0.75) Class C (0.78) (0.77) Class D and E (0.76) (0.74) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued. (4) Class B shares from inception July 2, 2002, through June 30,

161 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 15, % 1.48 % 2 % , , , , , , , , , , , (2.70) 3, (1.79) (3.37) 1, (2.41) (7.37) 1, (7.55) (7.30)

162 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Selected Per-Share Data (Rounded) Net Asset Value at Beginning of Period Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Director SMART529 The Hartford Global Leaders 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ - $ 1.90 $ 1.90 Class B (0.05) Class C (0.08) Class E From July 1, 2004 through June 30, 2005 Class A (0.05) (0.03) (0.08) Class B (0.10) (0.04) (0.14) Class C (0.12) (0.05) (0.17) Class D and E (0.02) (0.03) (0.05) From July 1, 2003 through June 30, 2004 Class A 9.48 (0.02) Class B 9.41 (0.06) Class C 9.40 (0.05) Class D and E 9.52 (0.01) From July 1, 2002 through June 30, 2003 Class A 9.59 (0.02) (0.09) (0.11) Class B (4) 9.48 (0.04) (0.03) (0.07) Class C 9.57 (0.06) (0.11) (0.17) Class D and E 9.60 (0.01) (0.07) (0.08) From inception March 1, 2002 through June 30, 2002 Class A (0.01) (0.62) (0.63) Class C (0.01) (0.64) (0.65) Class D and E (0.62) (0.62) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued. (4) Class B shares from inception July 2, 2002, through June 30,

163 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 4, % 0.03 % 3 % , (0.44) , (0.64) , (0.67) 3, (0.50) (1.17) (1.00) (1.35) 1, (1.19) (0.38) (0.20) , (0.46) (0.96) (1.15) (0.16) (1.14) (0.41) (0.71) (0.86) (1.82) (1.04) (0.85) (0.14) (6.17) (0.49) (6.35) (1.20) (6.10) (0.20)

164 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Selected Per-Share Data (Rounded) Net Asset Value at Beginning of Period Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Director SMART529 The Hartford High Yield 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.52 $ (0.16) $ 0.36 Class B (0.23) 0.30 Class C (0.23) 0.29 Class E (0.40) 0.39 From July 1, 2004 through June 30, 2005 Class A Class B Class C Class D and E From March 31, 2004 through June 30, 2004 Class A (0.32) (0.21) Class B (0.32) (0.22) Class C (0.31) (0.23) Class D and E (0.33) (0.20) Director SMART529 The Hartford Inflation Plus 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.34 $ (0.63) $ (0.29) Class B (0.62) (0.34) Class C (0.70) (0.36) Class E (0.85) (0.24) From July 1, 2004 through June 30, 2005 Class A Class B Class C Class D and E From March 31, 2004 through June 30, 2004 Class A (0.40) (0.35) Class B (0.41) (0.36) Class C (0.42) (0.37) Class D and E (0.42) (0.34) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued

165 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ % 6.59 % 13 % (2.09) (2.20) (2.27) (2.00) $ (2.74) % $ % 4.06 % 18 % 9.98 (3.24) (3.43) (2.35) (3.49) (3.61) (3.65) (3.42)

166 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Selected Per-Share Data (Rounded) Net Asset Value at Beginning of Period Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Director SMART529 The Hartford MidCap 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.19 $ 1.80 $ 1.99 Class B Class C Class E From July 1, 2004 through June 30, 2005 Class A Class B Class C Class D and E From July 1, 2003 through June 30, 2004 Class A 9.98 (0.03) Class B 9.91 (0.07) Class C 9.89 (0.06) Class D and E (0.02) From July 1, 2002 through June 30, 2003 Class A 9.81 (0.03) Class B (4) 9.56 (0.04) Class C 9.79 (0.06) Class D and E 9.82 (0.01) From inception March 1, 2002 through June 30, 2002 Class A (0.01) (0.29) (0.30) Class C (0.02) (0.29) (0.31) Class D and E (0.01) (0.28) (0.29) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued. (4) Class B shares from inception July 2, 2002, through June 30,

167 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 16, % 1.28 % 2 % , , , , , , , , (0.56) , (1.06) , (1.25) , (0.26) , (0.50) (0.95) , (1.13) , (0.22) (2.94) 1, (0.59) (3.12) (1.28) (2.86) (0.30)

168 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Selected Per-Share Data (Rounded) Net Asset Value at Beginning of Period Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Director SMART529 The Hartford Money Market 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.30 $ (0.01) $ 0.29 Class B (0.02) 0.23 Class C (0.03) 0.21 Class E (0.15) 0.32 From July 1, 2004 through June 30, 2005 Class A (0.01) 0.07 Class B Class C Class D and E (0.00) 0.11 From July 1, 2003 through June 30, 2004 Class A (0.02) (0.00) (0.02) Class B 9.99 (0.09) 0.04 (0.05) Class C 9.97 (0.09) 0.03 (0.06) Class D and E (0.24) (0.01) From July 1, 2002 through June 30, 2003 Class A Class B (4) (0.07) 0.04 (0.03) Class C (0.07) 0.02 (0.05) Class D and E From inception March 1, 2002 through June 30, 2002 Class A Class C Class D and E (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued. (4) Class B shares from inception July 2, 2002, through June 30, (5) Expense ratio without a practical waiver will be 0.91%, 1.41%, 1.60% and 0.61%

169 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ % 2.78 % 4 % (0.20) (5) (0.22) (0.45) (5) (0.46) (0.55) (5) (0.59) (0.05) (5) (0.10) (0.36) (0.37) (0.56) (0.51)

170 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Selected Per-Share Data (Rounded) Net Asset Value at Beginning of Period Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Director SMART529 The Hartford Stock 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ - $ 0.99 $ 0.99 Class B 9.90 (0.05) Class C 9.85 (0.07) Class E From July 1, 2004 through June 30, 2005 Class A Class B Class C 9.81 (0.02) Class D and E From July 1, 2003 through June 30, 2004 Class A 8.58 (0.03) Class B 8.52 (0.06) Class C 8.50 (0.05) Class D and E 8.61 (0.02) From July 1, 2002 through June 30, 2003 Class A 8.65 (0.03) (0.04) (0.07) Class B (4) 8.44 (0.05) Class C 8.64 (0.06) (0.08) (0.14) Class D and E 8.66 (0.01) (0.04) (0.05) From inception March 1, 2002 through June 30, 2002 Class A (0.01) (1.56) (1.57) Class C (0.02) (1.55) (1.57) Class D and E (0.01) (1.55) (1.56) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued. (4) Class B shares from inception July 2, 2002, through June 30,

171 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 5, % (0.01) % 7 % , (0.49) , (0.67) , , , , (0.17) , (0.58) (1.08) , (1.27) (0.28) (0.89) 2, (0.56) (1.01) (1.57) (1.19) (0.59) (0.29) (15.28) (0.68) (15.43) (1.36) (15.21) (0.38)

172 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Selected Per-Share Data (Rounded) Net Asset Value at Beginning of Period Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Director SMART529 The Hartford Total Return Bond 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.48 $ (0.68) $ (0.20) Class B (0.67) (0.26) Class C (0.69) (0.28) Class E (0.69) (0.17) From July 1, 2004 through June 30, 2005 Class A Class B Class C Class D and E From July 1, 2003 through June 30, 2004 Class A (0.55) 0.06 Class B (0.54) 0.01 Class C (0.65) (0.02) Class D and E (0.54) 0.09 From July 1, 2002 through June 30, 2003 Class A Class B (4) Class C Class D and E From inception March 1, 2002 through June 30, 2002 Class A Class C Class D and E (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued. (4) Class B shares from inception July 2, 2002, through June 30,

173 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ (1.63) % $ 4, % 4.09 % 9 % (2.13) 2, (2.31) 2, (1.34) , , , , , (0.12) 2, , , ,

174 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Cornerstone SMART529 Age-Based Portfolio 0-8 From July 1, 2005 through June 30, 2006 Class A $ $ 0.10 $ 1.13 $ 1.23 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B (0.01) Class C (0.02) Cornerstone SMART529 Age-Based Portfolio 9-13 From July 1, 2005 through June 30, 2006 Class A $ $ 0.23 $ 0.57 $ 0.80 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C Cornerstone SMART529 Age-Based Portfolio From July 1, 2005 through June 30, 2006 Class A $ $ 0.18 $ 0.39 $ 0.57 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued

175 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 10, % 0.79 % 10 % , , (0.19) (0.30) 5 $ % $ 6, % 1.99 % 12 % , , $ % $ 4, % 1.64 % 16 % , ,

176 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Cornerstone SMART529 Age-Based Portfolio 19+ From July 1, 2005 through June 30, 2006 Class A $ $ 0.11 $ 0.20 $ 0.31 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C Cornerstone SMART529 Aggressive Growth Portfolio From July 1, 2005 through June 30, 2006 Class A $ $ 0.17 $ 1.35 $ 1.52 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B (0.02) Class C (0.02) Cornerstone SMART529 Balanced Portfolio From July 1, 2005 through June 30, 2006 Class A $ $ 0.22 $ 0.48 $ 0.70 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued

177 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ % 1.25 % 45 % $ % $ 1, % 1.23 % 28 % (0.48) (0.27) 11 $ % $ 2, % 1.88 % 12 % , ,

178 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Cornerstone SMART529 Conservative Portfolio From July 1, 2005 through June 30, 2006 Class A $ $ 0.16 $ 0.23 $ 0.39 Class B (0.03) 0.34 Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C Cornerstone SMART529 Growth Portfolio From July 1, 2005 through June 30, 2006 Class A $ $ 0.22 $ 1.01 $ 1.23 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C Cornerstone SMART529 Stable Value 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ (0.11) $ 0.43 $ 0.32 Class B (0.20) Class C (0.19) From July 1, 2004 through June 30, 2005 Class A (0.11) Class B (0.05) Class C (0.13) From July 1, 2003 through June 30, 2004 Class A (0.03) Class B (0.06) Class C (0.06) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued

179 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ % 1.63 % 24 % $ % $ 4, % 1.92 % 9 % , , $ % $ % (1.36) % 10 % (1.86) (2.05) (1.30) (1.80) (2.00) (0.74) (1.26) (1.43)

180 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Cornerstone American Mutual 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.16 $ 0.83 $ 0.99 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C Cornerstone Federated Capital Appreciation 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ - $ 0.54 $ 0.54 Class B (0.06) Class C (0.08) From July 1, 2004 through June 30, 2005 Class A Class B (0.02) Class C (0.05) From July 1, 2003 through June 30, 2004 Class A (0.02) Class B (0.03) Class C (0.08) Cornerstone Federated Market Opportunity 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.30 $ 0.51 $ 0.81 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued

181 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 4, % 1.26 % 7 % , , $ % $ % (0.00) % 11 % (0.51) (0.64) (0.24) (0.46) (0.30) (0.53) (0.84) 3 $ % $ % 2.91 % 7 %

182 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Cornerstone Federated Total Return Bond 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.38 $ (0.51) $ (0.13) Class B (0.47) (0.18) Class C (0.41) (0.19) From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A (0.15) (0.01) Class B (0.25) (0.06) Class C (0.32) (0.08) Cornerstone Goldman Sachs Core Fixed Income 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.34 $ (0.53) $ (0.19) Class B (0.51) (0.24) Class C (0.40) (0.26) From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A (0.23) 0.07 Class B (1.63) 0.02 Class C (0.54) - Cornerstone Goldman Sachs Government Income 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.25 $ (0.39) $ (0.14) Class B (0.24) (0.19) Class C (0.32) (0.21) From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A (0.20) (0.03) Class B (0.34) (0.07) Class C (0.35) (0.09) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued

183 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ (1.21) % $ % 3.62 % 16 % (1.70) (1.88) (0.10) (0.58) (0.76) $ (1.72) % $ % 3.55 % 8 % (2.21) (2.39) (0.03) $ (1.33) % $ % 2.67 % 4 % (1.81) (2.00) (0.29) (0.75) (0.95)

184 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Cornerstone Goldman Sachs Large Cap Value 529 Fund From July 1, 2005 through June 30, 2006 Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Class A $ $ 0.16 $ 1.13 $ 1.29 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C (0.01) From July 1, 2003 through June 30, 2004 Class A (0.01) Class B (0.03) Class C (0.07) Cornerstone Goldman Sachs Structured U.S. Equity 529 Fund * From July 1, 2005 through June 30, 2006 Class A $ $ (0.05) $ 1.39 $ 1.34 Class B (0.10) Class C (0.14) From July 1, 2004 through June 30, 2005 Class A Class B (0.05) Class C (0.04) From July 1, 2003 through June 30, 2004 Class A (0.03) Class B (0.07) Class C (0.12) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued. * Effective January 1, 2006, the Cornerstone Goldman Sachs Core U.S. Equity 529 Fund changed its name to Cornerstone Goldman Sachs Structured U.S. Equity 529 Fund

185 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ % 1.58 % 5 % (0.21) (0.28) (0.54) (1.03) 3 $ % $ % (0.39) % 6 % (0.87) (1.10) (0.44) (0.36) (0.62) (1.01) (1.12)

186 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Cornerstone The Hartford Advisers 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.16 $ 0.51 $ 0.67 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C Cornerstone The Hartford Capital Appreciation 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ (0.03) $ 2.87 $ 2.84 Class B (0.09) Class C (0.10) From July 1, 2004 through June 30, 2005 Class A (0.08) Class B (0.13) Class C (0.16) From July 1, 2003 through June 30, 2004 Class A (0.04) Class B (0.06) Class C (0.11) Cornerstone The Hartford MidCap 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.18 $ 1.82 $ 2.00 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A (0.04) Class B (0.05) Class C (0.10) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued

187 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ % 1.33 % 12 % $ % $ 6, % (0.20) % 2 % (0.72) (0.90) , (0.71) (1.21) (1.40) , (0.74) (1.24) (1.43) 3 $ % $ 2, % 1.26 % 5 % , , (0.74) (1.24) (1.43)

188 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Cornerstone Lord Abbett Affiliated 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.15 $ 1.30 $ 1.45 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C Cornerstone Lord Abbett Bond-Debenture 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.66 $ (0.27) $ 0.39 Class B (0.21) 0.33 Class C (0.26) 0.31 From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C Cornerstone Lord Abbett MidCap Value 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.05 $ 0.81 $ 0.86 Class B (0.01) Class C (0.05) From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued

189 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 4, % 1.17 % 6 % , , (0.02) 4 $ % $ 1, % 5.85 % 8 % , $ % $ 3, % 0.36 % 2 % (0.09) (0.40) , ,

190 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Cornerstone Putnam Equity Income 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.18 $ 0.92 $ 1.10 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C (0.01) From July 1, 2003 through June 30, 2004 Class A Class B Class C Cornerstone Putnam Limited Duration Goverment Income 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.90 $ (1.05) $ (0.15) Class B (0.39) (0.20) Class C (0.38) (0.21) From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A (0.19) (0.15) Class B (0.29) (0.20) Class C (0.29) (0.22) Cornerstone Putnam International Equity 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.11 $ 3.27 $ 3.38 Class B Class C (0.01) From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued

191 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ % 1.59 % 5 % (0.08) $ 9.91 (1.46) % $ % 2.30 % 4 % 9.77 (1.94) (2.14) (1.53) (1.98) (2.17) $ % $ % 0.98 % 3 % (0.10) (0.03)

192 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Cornerstone Putnam Voyager 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ - $ 0.24 $ 0.24 Class B (0.05) Class C (0.06) From July 1, 2004 through June 30, 2005 Class A (0.07) Class B (0.16) Class C (0.16) From July 1, 2003 through June 30, 2004 Class A (0.03) Class B (0.14) Class C (0.16) Cornerstone Van Kampen Comstock 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.30 $ 0.81 $ 1.11 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C Cornerstone Van Kampen Emerging Growth 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ (0.08) $ 0.87 $ 0.79 Class B (0.13) Class C (0.06) From July 1, 2004 through June 30, 2005 Class A (0.07) Class B (0.15) Class C (0.15) From July 1, 2003 through June 30, 2004 Class A (0.04) Class B (0.08) Class C (0.09) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued

193 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ % 0.02 % 10 % (0.81) (0.88) (0.74) (1.24) (1.43) (0.74) (1.24) (1.43) 4 $ % $ 4, % 2.43 % 4 % , , $ % $ % (0.74) % 7 % (1.24) (1.43) (0.74) (1.24) (1.43) (0.74) (1.24) (1.43)

194 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Cornerstone Van Kampen Growth and Income 529 Fund From July 1, 2005 through June 30, 2006 Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Class A $ $ 0.16 $ 1.13 $ 1.29 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C Leaders SMART529 Age-Based Portfolio 0-8 From July 1, 2005 through June 30, 2006 Class A $ $ 0.01 $ 1.08 $ 1.09 Class B (0.04) Class C (0.07) From July 1, 2004 through June 30, 2005 Class A (0.01) Class B (0.06) Class C (0.08) From July 1, 2003 through June 30, 2004 Class A (0.01) Class B (0.03) Class C (0.04) Leaders SMART529 Age-Based Portfolio 9-13 From July 1, 2005 through June 30, 2006 Class A $ $ 0.21 $ 0.52 $ 0.73 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued

195 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 1, % 1.35 % 2 % , (0.01) 6 $ % $ 5, % 0.10 % 25 % , (0.39) , (0.59) , (0.15) , (0.65) , (0.83) , (0.28) (0.73) (0.87) 8 $ % $ 2, % 1.81 % 29 % , , , ,

196 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Leaders SMART529 Age-Based Portfolio From July 1, 2005 through June 30, 2006 Class A $ $ 0.16 $ 0.39 $ 0.55 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C Leaders SMART529 Age-Based Portfolio 19+ From July 1, 2005 through June 30, 2006 Class A $ $ 0.14 $ 0.22 $ 0.36 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C Leaders SMART529 Aggressive Growth Prtf From July 1, 2005 through June 30, 2006 Class A $ $ - $ 1.12 $ 1.12 Class B (0.04) Class C (0.08) From July 1, 2004 through June 30, 2005 Class A (0.02) Class B (0.06) Class C (0.07) From July 1, 2003 through June 30, 2004 Class A (0.02) Class B (0.05) Class C (0.06) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued

197 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 2, % 1.60 % 10 % , , $ % $ % 1.66 % 20 % $ % $ 1, % 0.04 % 17 % (0.48) (0.65) , (0.23) (0.74) (1.07) (0.44) (0.94) (1.07)

198 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Leaders SMART529 Balanced Portfolio From July 1, 2005 through June 30, 2006 Class A $ $ 0.18 $ 0.41 $ 0.59 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C Leaders SMART529 Conservative Portfolio From July 1, 2005 through June 30, 2006 Class A $ $ 0.09 $ 0.39 $ 0.48 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C Leaders SMART529 Growth Portfolio From July 1, 2005 through June 30, 2006 Class A $ $ 0.15 $ 0.69 $ 0.84 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued

199 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 1, % 1.55 % 17 % , , $ % $ % 1.99 % 15 % $ % $ 2, % 1.28 % 23 % , ,

200 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Leaders The Smart529 Stable Value Fund From July 1, 2005 through June 30, 2006 Class A $ $ (0.15) $ 0.47 $ 0.32 Class B (0.18) Class C (0.20) From July 1, 2004 through June 30, 2005 Class A (0.13) Class B (0.15) Class C (0.13) From July 1, 2003 through June 30, 2004 Class A (0.04) Class B (0.07) Class C (0.11) Leaders AIM Basic Value 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ (0.05) $ 0.85 $ 0.80 Class B (0.12) Class C (0.16) From July 1, 2004 through June 30, 2005 Class A (0.04) Class B (0.08) Class C (0.12) From July 1, 2003 through June 30, 2004 Class A (0.02) Class B (0.03) Class C (0.06) Leaders AIM Constellation 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ (0.02) $ 1.22 $ 1.20 Class B (0.06) Class C (0.06) From July 1, 2004 through June 30, 2005 Class A (0.04) Class B (0.08) Class C (0.12) From July 1, 2003 through June 30, 2004 Class A (0.02) Class B (0.06) Class C (0.08) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued

201 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ % (1.36) % 30 % (1.86) (2.05) (1.31) (1.81) (2.00) (0.74) (1.24) (1.43) 47 $ % $ % (0.52) % 4 % (1.02) (1.21) (0.43) (0.93) (1.12) (0.39) (0.89) (1.08) 5 $ % $ % (0.36) % 2 % (0.86) (1.05) (0.40) (0.90) (1.09) (0.37) (0.86) (1.05)

202 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Leaders AIM Large Cap Basic Value 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ (0.05) $ 1.05 $ 1.00 Class B (0.12) Class C (0.12) From July 1, 2004 through June 30, 2005 Class A (0.04) Class B (0.11) Class C (0.12) From July 1, 2003 through June 30, 2004 Class A (0.02) Class B (0.08) Class C (0.11) Leaders American Mutual 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.15 $ 0.84 $ 0.99 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C Leaders Franklin Capital Growth 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ (0.04) $ 0.71 $ 0.67 Class B (0.10) Class C (0.13) From July 1, 2004 through June 30, 2005 Class A (0.07) (0.28) (0.35) Class B (0.11) (0.30) (0.41) Class C (0.12) (0.30) (0.42) From July 1, 2003 through June 30, 2004 Class A (0.04) Class B (0.08) Class C (0.09) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued

203 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ % (0.44) % 2 % (0.94) (1.13) (0.45) (0.95) (1.14) (0.40) (0.89) (1.08) 12 $ % $ 1, % 1.27 % 9 % $ % $ % (0.40) % 9 % (0.87) (1.07) (2.95) (0.74) (3.44) (1.24) (3.62) (1.43) (0.61) (1.07) (1.23)

204 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Leaders Franklin Small-Mid Cap Growth 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ (0.08) $ 1.49 $ 1.41 Class B (0.13) Class C (0.18) From July 1, 2004 through June 30, 2005 Class A (0.08) Class B (0.12) Class C (0.15) From July 1, 2003 through June 30, 2004 Class A (0.04) Class B (0.09) Class C (0.08) Leaders Franklin Strategic Income 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.53 $ (0.24) $ 0.29 Class B (0.31) 0.23 Class C (0.27) 0.21 From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C Leaders MFS Massachusetts Investors Growth Stock 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ (0.09) $ 0.59 $ 0.50 Class B (0.13) Class C (0.16) From July 1, 2004 through June 30, 2005 Class A (0.03) Class B (0.08) Class C (0.09) From July 1, 2003 through June 30, 2004 Class A (0.04) Class B (0.07) Class C (0.08) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued

205 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ % (0.63) % 4 % (1.14) (1.31) (0.74) (1.24) (1.43) (0.74) (1.24) (1.43) 4 $ % $ % 5.07 % 9 % $ % $ % (0.74) % 2 % (1.24) (1.43) (0.34) (0.81) (1.03) (0.74) (1.24) (1.43)

206 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Leaders Massachusetts Investors Trust 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ (0.05) $ 1.01 $ 0.96 Class B (0.10) Class C (0.10) From July 1, 2004 through June 30, 2005 Class A (0.01) Class B (0.06) Class C (0.08) From July 1, 2003 through June 30, 2004 Class A Class B (0.03) Class C (0.03) Leaders MFS Research Bond 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.47 $ (0.66) $ (0.19) Class B (0.70) (0.24) Class C (0.67) (0.26) From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A (0.11) - Class B (0.34) (0.04) Class C (0.41) (0.06) Leaders MFS Total Return 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.29 $ 0.11 $ 0.40 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued

207 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ % (0.39) % 5 % (0.88) (1.03) (0.05) (0.54) (0.76) (0.31) (0.32) 23 $ (1.80) % $ % 4.51 % 8 % (2.29) (2.47) (0.44) (0.64) $ % $ % 2.75 % 8 %

208 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Leaders MFS Value 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.05 $ 1.35 $ 1.40 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C (0.02) From July 1, 2003 through June 30, 2004 Class A Class B Class C (0.01) Leaders Mutual Shares 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.32 $ 1.27 $ 1.59 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B Class C (0.02) Leaders Templeton Foreign 529 Fund From July 1, 2005 through June 30, 2006 Class A $ $ 0.54 $ 1.92 $ 2.46 Class B Class C From July 1, 2004 through June 30, 2005 Class A Class B Class C From July 1, 2003 through June 30, 2004 Class A Class B (0.03) Class C (0.07) (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued

209 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ % 0.47 % 25 % (0.01) (0.23) (0.12) 13 $ % $ % 2.54 % 4 % (0.28) 3 $ % $ % 3.94 % 4 % (0.04) (0.58) (1.14)

210 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations SMART529 Select Age-Based DFA Portfolio 0-3 From July 1, 2005 through June 30, 2006 Class D $ $ 0.14 $ 1.72 $ 1.86 From inception September 17, 2004 through June 30, 2005 Class D SMART529 Select Age-Based DFA Portfolio 4-6 From July 1, 2005 through June 30, 2006 Class D $ $ 0.12 $ 1.52 $ 1.64 From inception September 17, 2004 through June 30, 2005 Class D SMART529 Select Age-Based DFA Portfolio 7-9 From July 1, 2005 through June 30, 2006 Class D $ $ 0.18 $ 1.25 $ 1.43 From inception September 17, 2004 through June 30, 2005 Class D SMART529 Select Age-Based DFA Portfolio From July 1, 2005 through June 30, 2006 Class D $ $ 0.11 $ 1.02 $ 1.13 From inception September 17, 2004 through June 30, 2005 Class D SMART529 Select Age-Based DFA Portfolio From July 1, 2005 through June 30, 2006 Class D $ $ 0.13 $ 0.73 $ 0.86 From inception September 17, 2004 through June 30, 2005 Class D SMART529 Select Age-Based DFA Portfolio From July 1, 2005 through June 30, 2006 Class D $ $ 0.15 $ 0.44 $ 0.59 From inception September 17, 2004 through June 30, 2005 Class D SMART529 Select Age-Based DFA Portfolio 19+ From July 1, 2005 through June 30, 2006 Class D $ $ 0.19 $ 0.14 $ 0.33 From inception September 17, 2004 through June 30, 2005 Class D SMART529 Select Aggressive Growth DFA Portfolio From July 1, 2005 through June 30, 2006 Class D $ $ 0.12 $ 1.75 $ 1.87 From inception September 17, 2004 through June 30, 2005 Class D (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued

211 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 4, % 1.47 % 30 % , $ % $ 2, % 1.64 % 25 % $ % $ 1, % 1.61 % 71 % $ % $ 2, % 1.86 % 24 % $ % $ 1, % 2.13 % 26 % $ % $ % 2.22 % 93 % $ % $ % 2.60 % 103 % $ % $ 5, % 1.46 % 13 % ,

212 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period SMART529 Select Moderately Aggressive Growth DFA Portfolio From July 1, 2005 through June 30, 2006 Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations Class D $ $ 0.14 $ 1.50 $ 1.64 From inception September 17, 2004 through June 30, 2005 Class D SMART529 Select Growth DFA Portfolio From July 1, 2005 through June 30, 2006 Class D $ $ 0.14 $ 1.29 $ 1.43 From inception September 17, 2004 through June 30, 2005 Class D SMART529 Select Moderate Growth DFA Portfolio From July 1, 2005 through June 30, 2006 Class D $ $ 0.17 $ 0.97 $ 1.14 From inception September 17, 2004 through June 30, 2005 Class D SMART529 Select Balanced DFA Portfolio From July 1, 2005 through June 30, 2006 Class D $ $ 0.12 $ 0.74 $ 0.86 From inception September 17, 2004 through June 30, 2005 Class D SMART529 Select Conservative DFA Portfolio From July 1, 2005 through June 30, 2006 Class D $ $ 0.09 $ 0.24 $ 0.33 From inception September 17, 2004 through June 30, 2005 Class D SMART529 Select Moderately Conservative DFA Portfolio From July 1, 2005 through June 30, 2006 Class D $ $ 0.08 $ 0.51 $ 0.59 From inception September 17, 2004 through June 30, 2005 Class D (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued

213 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 1, % 1.72 % 19 % $ % $ 3, % 1.84 % 10 % $ % $ 1, % 1.91 % 65 % $ % $ % 2.11 % 42 % $ % $ % 2.82 % 18 % $ % $ % 2.19 % 8 %

214 West Virginia College Prepaid Tuition and Savings Program Savings Plan Trust Fund Financial Highlights (Continued) Net Asset Value at Beginning of Period Selected Per-Share Data (Rounded) Net Income (Loss) Net Realized and Unrealized Gain (Loss) Total from Operations SMART529 Select All Equity DFA Portfolio From July 1, 2005 through June 30, 2006 Class D $ $ 0.12 $ 1.94 $ 2.06 From inception September 17, 2004 through June 30, 2005 Class D SMART529 Select Fixed Income DFA Portfolio From July 1, 2005 through June 30, 2006 Class D $ $ 0.23 $ (0.14) $ 0.09 From inception September 17, 2004 through June 30, 2005 Class D SMART529 Select 1-Year Fixed DFA Portfolio From July 1, 2005 through June 30, 2006 Class D $ $ 0.13 $ 0.15 $ 0.28 From inception September 17, 2004 through June 30, 2005 Class D (0.02) 0.07 (1) Periods less than one year are not annualized for total returns. (2) Periods less than one year are annualized for ratio of expenses to average net assets and ratios of net investment income to average net assets. (3) Portfolio turnover rate is calculated on the basis of the fund as a whole without distinguishing between the class of shares issued

215 Selected Per-Share Data (Rounded) Net Asset Value at End of Period Total Return % Based on Net Asset Value per Unit (1) Net Assets at End of Period (000's) Ratios and Supplemental Data Ratio of Expenses to Average Net Assets (2) Ratio of Net Income to Average Net Assets (2) Portfolio Turnover Rate (3) $ % $ 8, % 1.49 % 8 % , $ % $ % 2.65 % 10 % $ % $ % 2.86 % 29 %

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217 Statistical Section Informational Tables and Charts

218 Table 1: Net Assets and Changes in Net Assets Enterprise Funds The enterprise funds began operations in July Activity during the first year of operations consisted of appropriations from the state and start-up costs. Activity in the ensuing years included revenues from contracts and investments, and expenses related to the tuition benefit liability. Revenue from the Savings Plan administrative fee began with the Savings Plan s first full year of operations in Tuition contract revenues were down in 2004 because the Prepaid Tuition Plan was closed to new contract sales during that fiscal year after an abbreviated enrollment period Changes in Net Assets Operating revenues Tuition contracts $ 397 $ 632 $ 357 Savings Plan administrative fee Total operating revenues 1,056 1, Operating expenses Tuition contract benefits and expenses 7,342 4,296 9,064 General and administrative expenses Total operating expenses 7,836 4,756 9,587 Operating (loss) gain (6,780) (3,670) (8,979) Nonoperating revenues (losses) earnings (losses) 8,019 8,704 10,554 Appropriations from State of West Virginia Total nonoperating revenues (losses) 8,169 8,852 10,702 Change in net assets $ 1,389 $ 5,182 $ 1,723 Net Assets (Deficit) at Year-End Fiscal Year Ended June 30 In Thousands Restricted for payment of general and administrative expenses $ 465 $ 150 $ 6 Unrestricted (5,725) (6,798) (11,837) Total net assets (deficit) $ (5,260) $ (6,648) $ (11,831)

219 Fiscal Year Ended June 30 In Thousands $ 3,430 $ 7,501 $ 14,412 $ 14,657 $ 42,020 $ ,519 7,501 14,412 14,657 42,020-4,233 24,972 14,851 15,402 40, ,638 25,574 15,460 16,004 41, (1,119) (18,073) (1,048) (1,347) 571 (90) 3,474 (1,465) 293 3, ,150 3,632 (1,308) 448 3, ,150 $ 2,513 $ (19,381) $ (600) $ 1,821 $ 1,032 $ 1,060 $ 9 $ - $ - $ - $ - $ - (13,563) (16,067) 3,314 3,914 2,092 1,060 $ (13,554) $ (16,067) $ 3,314 $ 3,914 $ 2,092 $ 1,

220 Table 2: Changes in Net Assets Fiduciary Fund The fiduciary fund began operations during the last four months of fiscal year The table below presents additions and deductions and changes in net assets for each fiscal year since inception. Fiscal Year Ended June 30 In Thousands Additions Contributions: Account holders $ 213,129 $ 174,744 $ 193,423 $ 106,227 $ 36,116 Deposits to establish new investment funds Total contributions 213, , , ,306 36,174 earnings: Net increase (decrease) in fair value of investments 28,959 27,620 34,119 9,585 (2,161) Dividends and capital gains 38,907 7,482 3,481 1, expense 3,748 2,543 1, Net investment earnings 64,118 32,559 36,265 10,334 (2,111) Total additions 277, , , ,640 34,063 Deductions Redemptions: Payments in acordance with trust agreements 63,874 20,769 7,677 3, Redemptions of deposits to establish new investment funds Total redemptions 63,999 20,909 7,796 3, Administrative expense 2,196 1, Total deductions 66,195 22,368 8,575 3, Change in net assets $ 211,052 $ 185,020 $ 221,317 $ 112,922 $ 33,

221 Table 3: Types of Prepaid Tuition Plan Contracts Contracts are held in units, which represent a semester of college studies. The chart illustrates the number of contracts with units remaining to be used as of June 30, Contracts 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1, ,418 1, or less 1+ to 2 2+ to 3 3+ to 4 4+ to 5 5+ to 6 6+ to 7 7+ to 8 8+ to 9 9+ to 10 Contract Units Remaining Monthly Payment Plans, 56% Lump Sum Plans, 44% Purchasers chose either to make a lump sum payment for a contract or to select among monthly payment options. Source: West Virginia College Prepaid Tuition & Savings Program

222 Table 4: Prepaid Tuition Plan Beneficiaries Grade Grade Grade Grade Grade Grade 5 Grade 719 Grade 4 Grade 686 Grade 3 Grade 634 Grade 2 Grade 634 Grade Grade 1 Kindergarten 629 Kindergarten Age Age 4 Age Age 3 Age Age 2 Age Age 1 Infant 684 Infant Newborn 472 Newborn Purchasers selected plans based on beneficiary age and grade during the enrollment period. This chart shows the distribution of plans by age and grade at the time of contract purchase. Girls 48.3% Boys 51.7% Beneficiary distribution by gender Source: West Virginia College Prepaid Tuition & Savings Program