UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549


FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES



Investment Company Act file number 811-07959



Advisors Series Trust
(Exact name of registrant as specified in charter)



615 East Michigan Street
Milwaukee, Wisconsin 53202
(Address of principal executive offices) (Zip code)



Douglas G. Hess, President
Advisors Series Trust
c/o U.S. Bancorp Fund Services, LLC
777 East Wisconsin Avenue, 5 th Floor
Milwaukee, Wisconsin 53202
(Name and address of agent for service)



(Registrant's telephone number, including area code): (414) 765-6609



Date of fiscal year end:   November 30, 2013



Date of reporting period:   November 30, 2013

 
 

 
Item 1. Reports to Stockholders.


 
 
 
 
PIA Funds

– PIA Short-Term
Securities Fund





 
 

 
Annual Report
 
November 30, 2013
 

 

 
 
 

 
 

 
PIA Short-Term Securities Fund


Dear Shareholder:
 
We are pleased to provide you with this annual report for the twelve month period ended November 30, 2013 regarding the PIA Short-Term Securities Fund for which Pacific Income Advisers, Inc. (PIA) is the adviser.
 
During the twelve months ended November 30, 2013, the total returns, including the reinvestment of dividends and capital gains, were as follows:
 
 
PIA Short-Term Securities Fund
0.34%
 
 
The PIA Short-Term Securities Fund’s return of 0.34% for the twelve month period ended November 30, 2013 was higher than the Fund’s benchmark index, the BofA Merrill Lynch 1-Year U.S. Treasury Note Index, which returned 0.28% for the same period and slightly lower than that of the Barclay’s Capital U.S. Government/Corporate 1-Year Duration Index return of 0.40%.  The Fund’s total return is net of 0.35% in Fund fees and expenses for the twelve months, compared to the benchmark index, which does not incur fees and expenses.  As stated in the current prospectus, the Fund’s gross expense ratio is 0.38%.
 
PIA has contractually agreed to waive all or a portion of its management fees and pay Fund expenses to ensure that Net Annual Fund Operating Expenses (excluding acquired fund fees and expenses, interest, taxes and extraordinary expenses) do not exceed 0.35% of the Fund’s average daily net assets through March 29, 2014.
 
During the twelve month period ended November 30, 2013, the Fund had close to a neutral maturity structure relative to the Fund’s benchmark index.  The Fund also had an overweight in short average life/floating rate government mortgage-backed securities, agencies and the allocation to investment grade corporate notes which added yield to the portfolio.
 
Bond Market in Review
The Gross Domestic Product’s (GDP) quarter over quarter rate of growth was +1.1% for the first quarter of 2013, increasing to +3.6% during the third quarter of 2013.  This recent quarter for GDP compares favorably for a year over year GDP of 2.0% for all of 2012.  The housing sector is showing signs of stability and unemployment levels declined to 7.3% from 8.0% a year ago.  The Federal Reserve maintained its easier monetary policy by keeping the Federal Funds Rate close to zero.  Inflation, as measured by the Consumer Price Index, declined to 1.0% year over year as of October 2013, down from a 2.2% pace year over year at October 2012.
 
Yields on 5-year Treasury notes and 30-year Treasury bonds rose by 75 and 100 basis points (bp), respectively, from November 30, 2012 to November 30, 2013.  Yields on 6 month Treasuries fell 3 bp during the period while 2 year Treasuries rose only 4 bp.  The improving economy, stabilization of European sovereign risk, and purchases of treasuries and mortgage-backed securities by the Federal Reserve helped the bond market.

 
 

 
1

 
PIA Short-Term Securities Fund

Please take a moment to review the Fund’s statement of assets and liabilities and the results of operations for the twelve month period ended November 30, 2013.  We look forward to reporting to you again with the semi-annual report dated May 31, 2014.
 
 
Lloyd McAdams
Chairman of the Board
Pacific Income Advisers, Inc.
 
 
 
Past performance is not a guarantee of future results.
 
Opinions expressed above are those of the adviser and are subject to change, are not guaranteed and should not be considered recommendations to buy or sell any security.
 
Must be preceded or accompanied by a prospectus.
 
Mutual fund investing involves risk.  Principal loss is possible.  Investments in debt securities typically decrease in value when interest rates rise.  This risk is usually greater for longer-term debt securities.  Investments in Asset-Backed and Mortgage-Backed Securities include additional risks that investors should be aware of such as credit risk, prepayment risk, possible illiquidity and default, as well as increased susceptibility to adverse economic developments.
 
The Fund may also use options and futures contracts.  Derivatives involve risks different from, and in certain cases, greater than the risks presented by more traditional investments.  These risks are fully disclosed in the Prospectus.
 
The BofA Merrill Lynch 1-Year U.S. Treasury Note Index (the “Index”) is an unmanaged index presented for comparative purposes only.  The Index is comprised of a single U.S. Treasury issue with approximately one year to final maturity purchased at the beginning of each month and held for one full month.  At the end of the month, that issue is sold and rolled into a newly selected issue.  The Barclays Capital U.S. Government/Corporate 1-Year Duration Index is an unmanaged index, which represents the short-term U.S. investment grade bond market as well as short-term U.S. government agency and Treasury securities.  You cannot invest directly in an index.
 
Gross Domestic Product is the amount of goods and services produced in a year, in a country.
 
Consumer Price Index measures the weighted average of prices of a basket of consumer goods and services, such as transportation, food and medical care.
 
Basis point equals 1/100th of 1%.
 
Please refer to the Schedule of Investments in the report for complete holdings information.  Fund holdings and sector allocations are subject to change at any time and are not recommendations to buy or sell any security.  Investment performance reflects fee waivers in effect.  In the absence of such waivers, total return would be reduced.
 
Quasar Distributors, LLC, Distributor
 

 

 

 

 
2

 
PIA Short-Term Securities Fund

 
PIA SHORT-TERM SECURITIES FUND
Comparison of the change in value of a $10,000 investment in the PIA Short-Term Securities Fund vs
the BofA Merrill Lynch 1-Year U.S. Treasury Note Index and
the Barclays Capital U.S. Government/Corporate 1-Year Duration Index
 
 

Average Annual Total Return*
1 Year
5 Years
10 Years
PIA Short-Term Securities Fund
0.34%
0.87%
2.17%
BofA Merrill Lynch 1-Year U.S. Treasury Note Index
0.28%
0.63%
2.10%
Barclays Capital U.S. Government/Corporate 1-Year Duration Index
0.40%
1.01%
2.28%
 
Performance data quoted represents past performance; past performance does not guarantee future results.  The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost.  Current performance of the Fund may be lower or higher than the performance quoted.  Performance data current to the most recent month end may be obtained by calling 1-800-251-1970.
 
This chart illustrates the performance of a hypothetical $10,000 investment made in the Fund ten years ago.  Returns reflect the reinvestment of dividends and capital gain distributions.  Fee waivers are in effect.  In the absence of fee waivers,  returns would be reduced.  The performance data and graph do not reflect the deduction of taxes that a shareholder may pay on dividends, capital gain distributions, or redemption of Fund shares.  This chart does not imply any future performance.
 
The BofA Merrill Lynch 1-Year U.S. Treasury Note Index is an unmanaged index consisting of a single U.S. Treasury  issue with approximately one year to final maturity purchased at the beginning of each month and held for one full month.  At the end of the month, that issue is sold and rolled into a newly selected issue.
 
The Barclays Capital U.S. Government/Corporate 1-Year Duration Index is an unmanaged index, which represents the short-term U.S. investment grade bond market as well as short-term U.S. government agency and Treasury securities.
 
Indices do not incur expenses and are not available for investment.
 
*  Average Annual Total Return represents the average change in account value over the periods indicated.
 

 

 

 

 
3

 
PIA Short-Term Securities Fund
Expense Example – November 30, 2013
(Unaudited)

As a shareholder of a mutual fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, redemption fees, and exchange fees, and (2) ongoing costs, including management fees, distribution and/or service fees, and other fund expenses.  This Example is intended to help you understand your ongoing costs (in dollars) of investing in the PIA Funds and to compare these costs with the ongoing costs of investing in other mutual funds.  The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (6/1/13 –11/30/13).
 
Actual Expenses
The first line of the table below provides information about actual account values and actual expenses, with actual net expenses being limited to 0.35% per the Operating Expenses Limitation Agreement for the PIA Short-Term Securities Fund.  Although the Fund charges no sales loads or transaction fees, you will be assessed fees for outgoing wire transfers, returned checks, and stop payment orders at prevailing rates charged by U.S. Bancorp Fund Services, LLC, the Fund’s transfer agent.  The Example below includes, but is not limited to, management fees, fund accounting, custody and transfer agent fees.  You may use the information in the first line, together with the amount you invested, to estimate the expenses that you paid over the period.  Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
 
Hypothetical Example for Comparison Purposes
The second line of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is different from the Fund’s actual returns.  The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period.  You may use this information to compare the ongoing costs of investing in the Fund and other funds.  To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.  Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads), redemption fees, or exchange fees.  Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.  In addition, if these transaction costs were included, your costs would have been higher.
 
 
Beginning Account
Ending Account
Expenses Paid During
 
Value 6/1/13
Value 11/30/13
Period 6/1/13 – 11/30/13*
PIA Short-Term Securities Fund
     
    Actual
$1,000.00
$1,003.00
$1.76
    Hypothetical (5% return before expenses)
$1,000.00
$1,023.31
$1.78

*
Expenses are equal to the Fund’s annualized expense ratio, multiplied by the average account value over the period, multiplied by 183 (days in most recent fiscal half-year) / 365 days to reflect the one-half year expense.  The annualized expense ratio of the PIA Short-Term Securities Fund is  0.35%.




 
4

 
PIA Short-Term Securities Fund
Allocation of Portfolio Assets – November 30, 2013
(Unaudited)

Investments by Type
As a Percentage of Total Investments
 




 
5

 
PIA Short-Term Securities Fund
Schedule of Investments – November 30, 2013

 
Principal Amount
     
Value
 
CORPORATE BONDS 45.7%
     
       
Agricultural Equipment 0.7%
     
   
John Deere Capital Corp.
     
$ 1,000,000  
  0.75%, due 1/22/16
  $ 999,144  
Agriculture 0.8%
       
     
Bunge Limited
       
  1,000,000  
  4.10%, due 3/15/16
    1,054,658  
         
Autos 2.7%
       
     
American Honda Financial Corp.
       
  1,000,000  
  1.125%, due 10/7/16
    1,006,937  
     
Daimler Finance
       
     
  North America LLC (a)
       
  1,200,000  
  1.45%, due 8/1/16
    1,211,057  
     
Ford Motor Credit Co. LLC
       
  1,000,000  
  1.70%, due 5/9/16
    1,013,692  
     
Volkswagen International
       
     
  Finance N.V.
       
  500,000  
  1.125%, due 11/18/16 (a)
    501,274  
            3,732,960  
Banks 9.1%
       
     
Bank of America Corp.
       
  1,300,000  
  4.50%, due 4/1/15
    1,363,549  
     
Bank of New York Mellon
       
  1,300,000  
  2.95%, due 6/18/15
    1,350,122  
     
BB&T Corp.
       
  1,000,000  
  5.20%, due 12/23/15
    1,084,621  
     
BMO Bank of Montreal
       
  1,000,000  
  1.30%, due 7/15/16
    1,011,159  
     
Capital One Financial Corp.
       
  1,000,000  
  2.15%, due 3/23/15
    1,017,935  
     
Citigroup, Inc.
       
  1,000,000  
  2.65%, due 3/2/15
    1,021,934  
     
JPMorgan Chase & Co.
       
  1,500,000  
  1.875%, due 3/20/15
    1,522,989  
     
State Street Corp.
       
  1,550,000  
  4.30%, due 5/30/14
    1,580,701  
     
Suntrust Banks, Inc.
       
  650,000  
  3.60%, due 4/15/16
    688,951  
     
Toronto Dominion Bank
       
  500,000  
  1.50%, due 9/9/16
    509,724  
     
Wells Fargo & Co.
       
  1,500,000  
  3.75%, due 10/1/14
    1,541,648  
            12,693,333  
Biotech 0.5%
       
     
Amgen, Inc.
       
  700,000  
  2.30%, due 6/15/16
    724,513  
         
Brokers 1.0%
       
     
Goldman Sachs Group, Inc.
       
  1,300,000  
  3.30%, due 5/3/15
    1,344,038  
         
Chemicals 2.6%
       
     
Dow Chemical Co.
       
  1,200,000  
  2.50%, due 2/15/16
    1,242,411  
     
Eastman Chemical Co.
       
  700,000  
  3.00%, due 12/15/15
    728,309  
     
Ecolab, Inc.
       
  1,000,000  
  2.375%, due 12/8/14
    1,018,954  
  565,000  
  3.00%, due 12/8/16
    593,663  
            3,583,337  
Computer Equipment 0.9%
       
     
Cisco Systems, Inc.
       
  1,300,000  
  1.625%, due 3/14/14
    1,305,164  
         
Computer Hardware 0.7%
       
     
Apple, Inc.
       
  1,000,000  
  0.45%, due 5/3/16
    997,672  
         
Consumer Finance 1.0%
       
     
American Express Credit
       
  1,300,000  
  1.75%, due 6/12/15
    1,323,347  
         
Diversified Financial Services 1.1%
       
     
General Electric Capital Corp.
       
  1,550,000  
  3.75%, due 11/14/14
    1,600,790  
         
Diversified Minerals 0.6%
       
     
BHP Billiton Finance USA, Ltd.
       
  800,000  
  1.00%, due 2/24/15
    807,151  

The accompanying notes are an integral part of these financial statements.



 
6

 
PIA Short-Term Securities Fund
Schedule of Investments – November 30, 2013 (continued)

 
Principal Amount
     
Value
 
Electric Utilities 0.5%
     
   
Dominion Resources, Inc.
     
$ 700,000  
  1.95%, due 8/15/16
  $ 715,442  
         
Electrical Equipment 0.7%
       
     
Tyco International Group SA
       
  1,000,000  
  3.375%, due 10/15/15
    1,040,651  
         
Finance 0.8%
       
     
SLM Corp.
       
  1,000,000  
  6.25%, due 1/25/16
    1,092,500  
         
Financial Services 0.9%
       
     
CME Group, Inc.
       
  1,200,000  
  5.75%, due 2/15/14
    1,212,529  
         
Food 1.5%
       
     
Conagra Foods, Inc.
       
  930,000  
  1.30%, due 1/25/16
    935,555  
     
Kraft Foods Group, Inc.
       
  1,200,000  
  1.625%, due 6/4/15
    1,217,916  
            2,153,471  
Food and Beverage 2.0%
       
     
Coca Cola Co.
       
  1,000,000  
  1.80%, due 9/1/16
    1,030,444  
     
Pepsico, Inc.
       
  1,300,000  
  0.70%, due 8/13/15
    1,303,860  
     
Wm. Wrigley Jr. Co.
       
  500,000  
  1.40%, due 10/21/16 (a)
    503,428  
            2,837,732  
Health Care 0.7%
       
     
McKesson Corp.
       
  1,000,000  
  0.95%, due 12/4/15
    1,001,119  
         
Industrial 0.3%
       
     
Caterpillar Financial
       
     
  Services Corp.
       
  420,000  
  1.35%, due 9/6/16
    425,163  
         
Insurance 3.2%
       
     
Aetna Inc.
       
  1,000,000  
  6.00%, due 6/15/16
    1,125,508  
     
American International
       
     
  Group, Inc.
       
  700,000  
  3.00%, due 3/20/15
    721,042  
     
CNA Financial Corp.
       
  88,000  
  5.85%, due 12/15/14
    92,623  
     
Metlife, Inc.
       
  850,000  
  2.375%, due 2/6/14
    853,004  
     
Prudential Financial Inc.
       
  950,000  
  4.75%, due 9/17/15
    1,017,047  
     
Wellpoint, Inc.
       
  650,000  
  5.25%, due 1/15/16
    708,103  
            4,517,327  
Life Sciences Equipment 0.6%
       
     
Thermo Fisher Scientific, Inc.
       
  800,000  
  3.20%, due 5/1/15
    824,394  
         
Manufacturing 0.4%
       
     
ITT Corp.
       
  485,000  
  7.375%, due 11/15/15
    540,634  
         
Media 1.5%
       
     
Time Warner, Inc.
       
  985,000  
  3.15%, due 7/15/15
    1,023,924  
     
Viacom Inc.
       
  1,000,000  
  1.25%, due 2/27/15
    1,005,577  
            2,029,501  
Medical Equipment 0.7%
       
     
Agilent Technologies, Inc.
       
  425,000  
  5.50%, due 9/14/15
    460,631  
     
Baxter International, Inc.
       
  450,000  
  0.95%, due 6/1/16
    452,582  
            913,213  

The accompanying notes are an integral part of these financial statements.
 
 

 
 
7

 

PIA Short-Term Securities Fund
Schedule of Investments – November 30, 2013 (continued)

 
Principal Amount
     
Value
 
Medical/Drugs 1.0%
     
   
Eli Lilly & Co.
     
$ 500,000  
  4.20%, due 3/6/14
  $ 504,958  
     
Wyeth
       
  800,000  
  5.50%, due 2/1/14
    806,650  
            1,311,608  
Metals and Mining 1.3%
       
     
Glencore Funding LLC
       
  500,000  
  1.70%, due 5/27/16 (a)
    501,170  
     
Rio Tinto Finance USA Ltd.
       
  1,300,000  
  1.875%, due 11/2/15
    1,326,113  
            1,827,283  
Pharmaceuticals 0.7%
       
     
Perrigo Co. PLC
       
  1,000,000  
  1.30%, due 11/8/16 (a)
    1,001,914  
         
Oil and Gas 1.0%
       
     
Anadarko Petroleum Corp.
       
  600,000  
  5.95%, due 9/15/16
    676,160  
     
Ensco Plc
       
  700,000  
  3.25%, due 3/15/16
    734,652  
            1,410,812  
Retail 2.5%
       
     
Target Corp.
       
  1,300,000  
  1.125%, due 7/18/14
    1,307,282  
     
Walgreen Co.
       
  1,200,000  
  1.00%, due 3/13/15
    1,206,797  
     
Wal-Mart Stores, Inc.
       
  1,000,000  
  1.625%, due 4/15/14
    1,005,571  
            3,519,650  
Semiconductors 0.9%
       
     
Texas Instruments, Inc.
       
  1,300,000  
  1.375%, due 5/15/14
    1,306,570  
         
Telecommunications 2.3%
       
     
American Tower Corp.
       
  233,000  
  4.625%, due 4/1/15
    244,456  
     
AT&T, Inc.
       
  1,500,000  
  0.875%, due 2/13/15
    1,504,293  
     
Verizon Communications, Inc.
       
  1,400,000  
  0.70%, due 11/2/15
    1,396,993  
            3,145,742  
Transportation 0.5%
       
     
Paccar Financial Corp.
       
  700,000  
  0.75%, due 5/16/16
    699,381  
Total Corporate Bonds
       
  (cost $63,422,000)
    63,692,743  
         
MORTGAGE-BACKED SECURITIES 18.2%
       
         
Commercial Mortgage-Backed Securities 5.4%
       
     
Banc of America Commercial
       
     
  Mortgage Trust
       
     
  5.72%, due 5/10/45, Series
       
  1,633,429  
  2006-2, Class AAB (b)
    1,683,537  
     
Credit Suisse Mortgage Capital
       
     
  5.47%, due 2/15/39, Series
       
  1,500,000  
  2006-C1, Class A4 (b)
    1,622,120  
     
Hilton USA Trust
       
     
  1.17%, due 11/5/30, Series
       
  2,000,000  
  2013-HLF, Class AFL (b)(e)
    2,010,000  
     
LB-UBS Commercial
       
     
  Mortgage Trust
       
     
  5.49%, due 6/15/29, Series
       
  1,103,142  
  2004-C4, Class A4 (b)
    1,117,010  
     
  5.66%, due 3/15/39, Series
       
  1,000,000  
  2006-C3, Class A4 (b)
    1,081,280  
            7,513,947  
Residential Mortgage-Backed Securities 2.9%
       
     
Invitation Homes Trust
       
     
  1.60%, due 12/17/30,
       
     
  Series 2013-SFR1,
       
  4,000,000  
  Class B (b)
    4,010,992  

The accompanying notes are an integral part of these financial statements.



 
8

 
PIA Short-Term Securities Fund
Schedule of Investments – November 30, 2013 (continued)

 
 
Principal Amount
     
Value
 
U.S. Government Agencies 9.9%
     
   
FHLMC ARM Pool (b)
     
$ 6,024  
  2.179%, due 8/1/15, #755204
  $ 6,044  
  9,366  
  2.348%, due 2/1/22, #845113
    10,020  
  30,193  
  1.999%, due 10/1/22, #635206
    30,788  
  9,206  
  2.349%, due 6/1/23, #845755
    9,471  
  8,038  
  2.33%, due 2/1/24, #609231
    8,113  
  421,991  
  2.401%, due 1/1/25, #785726
    443,058  
  10,813  
  2.408%, due 1/1/33, #1B0668
    10,878  
  591,478  
  2.375%, due 10/1/34, #782784
    630,415  
  244,806  
  2.552%, due 12/1/34, #1G0018
    259,162  
  162,074  
  2.678%, due 4/1/36, #847671
    172,622  
     
FHLMC Pool
       
  336,036  
  5.00%, due 10/1/38, #G04832
    362,899  
     
FNMA ARM Pool (b)
       
  25,557  
  2.54%, due 7/1/25, #555206
    25,804  
  150,119  
  1.927%, due 7/1/27, #424953
    153,000  
  84,400  
  2.35%, due 3/1/28, #556438
    85,663  
  91,684  
  2.331%, due 6/1/29, #508399
    97,932  
  235,639  
  2.103%, due 4/1/30, #562912
    248,867  
  81,058  
  2.432%, due 10/1/30, #670317
    82,868  
  44,604  
  2.24%, due 9/1/31, #597196
    47,108  
  29,617  
  2.277%, due 11/1/31, #610547
    29,775  
  3,774  
  2.25%, due 4/1/32, #629098
    3,798  
  445,083  
  2.245%, due 10/1/33, #743454
    469,688  
  1,303,311  
  2.375%, due 11/1/33, #755253
    1,371,056  
  2,045,876  
  2.432%, due 5/1/34, #AC5719
    2,173,368  
  506,771  
  2.389%, due 7/1/34, #779693
    536,531  
  416,347  
  2.054%, due 10/1/34, #795136
    438,358  
  208,550  
  2.382%, due 1/1/35, #805391
    222,706  
  118,134  
  2.281%, due 10/1/35, #845041
    124,912  
  267,269  
  2.232%, due 10/1/35, #846171
    281,009  
  456,951  
  2.383%, due 1/1/36, #849264
    489,238  
  134,337  
  2.515%, due 6/1/36, #872502
    142,955  
  772,678  
  2.439%, due 1/1/37, #906389
    820,984  
  1,037,203  
  2.833%, due 3/1/37, #907868
    1,113,162  
  543,900  
  2.28%, due 8/1/37, #949772
    557,880  
  51,203  
  2.25%, due 10/1/37, #955963
    52,185  
  285,266  
  2.64%, due 11/1/37, #953653
    285,394  
  98,660  
  1.81%, due 11/1/37, #948183
    103,003  
     
FNMA Pool
       
  746,811  
  5.00%, due 6/1/40, #AD5479
    814,019  
  78,240  
  4.00%, due 11/1/41, #AJ3797
    81,788  
     
GNMA II ARM Pool (b)
       
  9,991  
  2.00%, due 11/20/21, #8871
    10,378  
  57,112  
  1.625%, due 10/20/22, #8062
    59,347  
  136,354  
  1.625%, due 11/20/26, #80011
    141,709  
  34,577  
  2.00%, due 11/20/26, #80013
    35,920  
  18,934  
  1.625%, due 12/20/26, #80021
    19,677  
  9,084  
  1.625%, due 1/20/27, #80029
    9,436  
  154,993  
  1.625%, due 7/20/27, #80094
    161,885  
  212,969  
  1.625%, due 8/20/27, #80104
    222,438  
  8,964  
  1.625%, due 10/20/27, #80122
    9,316  
  77,420  
  1.625%, due 1/20/28, #80154
    80,422  
  157,353  
  1.625%, due 10/20/29, #80331
    163,539  
  31,484  
  1.625%, due 11/20/29, #80344
    32,721  
            13,743,309  
Total Mortgage-Backed Securities
       
  (cost $24,779,695)
    25,268,248  

The accompanying notes are an integral part of these financial statements.



 
9

 
PIA Short-Term Securities Fund
Schedule of Investments – November 30, 2013 (continued)

Shares/
         
Principal Amount
     
Value
 
U.S. GOVERNMENT AGENCIES AND
     
  INSTRUMENTALITIES 28.0%
     
       
U.S. Government Agencies 18.7%
     
   
FHLMC
     
$ 2,500,000  
  0.45%, due 1/9/14
  $ 2,500,938  
  4,200,000  
  0.75%, due 11/25/14
    4,225,300  
     
FNMA
       
  8,500,000  
  0.75%, due 12/18/13
    8,502,627  
  5,783,000  
  1.25%, due 2/27/14
    5,798,897  
  2,000,000  
  0.875%, due 8/28/14
    2,010,826  
  3,000,000  
  0.50%, due 5/27/15
    3,011,862  
            26,050,450  
U.S. Treasury Notes 9.3%
       
     
U.S. Treasury Note
       
  11,000,000  
  0.75%, due 12/15/13
    11,002,794  
  1,000,000  
  1.00%, due 1/15/14
    1,001,152  
  1,000,000  
  0.75%, due 6/15/14
    1,003,398  
            13,007,344  
Total U.S. Government Agencies
       
  and Instrumentalities
       
  (cost $39,043,893)
    39,057,794  
         
SHORT-TERM INVESTMENTS 9.1%
       
  3,724,499  
Fidelity Institutional Money
       
     
  Market Government Portfolio –
       
     
  Class I, 0.05% (c)
  $ 3,724,499  
     
U.S. Treasury Bill
       
$ 9,000,000  
  0.046%, due 12/19/13 (d)
    8,999,795  
 
Total Short-Term Investments
         
  (cost $12,724,294)
      12,724,294  
Total Investments
         
  (cost $139,969,882)
101.0
    140,743,079  
Liabilities less Other Assets
(1.0
)%      (1,396,565 )
TOTAL NET ASSETS
100.0
  $ 139,346,514  

(a)
Security purchased within the terms of a private placement memorandum, exempt from registration under Rule 144A of the Securities Act of 1933, as amended, and may be sold only to dealers in the program or other “qualified institutional buyers.”  The Fund’s adviser has determined that such security is liquid in accordance with the liquidity guidelines approved by the Board of Trustees of Advisors Series Trust.  As of November 30, 2013, the value of these investments was $3,718,843 or 2.7% of total net assets.
(b)
Variable rate security.  Rate shown reflects the rate in effect as of November 30, 2013.
(c)
Rate shown is the 7-day annualized yield as of November 30, 2013.
(d)
Rate shown is the discount rate at November 30, 2013.
(e)
Security valued at fair value using methods determined in good faith by or at the direction of the Board of Trustees of Advisors Series Trust.

ARM – Adjustable Rate Mortgage
FHLMC – Federal Home Loan Mortgage Corporation
FNMA – Federal National Mortgage Association
GNMA – Government National Mortgage Association




 
10

 
PIA Short-Term Securities Fund
Statement of Assets and Liabilities – November 30, 2013

Assets:
     
      Investments in securities, at value (cost $139,969,882)
  $ 140,743,079  
      Deposit at broker for futures contracts
    1,000  
      Receivable for securities sold
    25,286  
      Receivable for fund shares sold
    251,917  
      Interest receivable
    584,738  
      Prepaid expenses
    27,467  
                  Total assets
    141,633,487  
         
Liabilities:
       
      Payable for fund shares redeemed
    203,984  
      Payable for securities purchased
    2,000,000  
      Investment advisory fees
    16,277  
      Administration fees
    7,416  
      Custody fees
    2,852  
      Transfer agent fees and expenses
    19,289  
      Fund accounting fees
    9,612  
      Audit fees
    17,979  
      Chief Compliance Officer fee
    994  
      Accrued expenses
    8,570  
                  Total liabilities
    2,286,973  
                  Net Assets
  $ 139,346,514  
         
Net Assets Consist of:
       
      Paid-in capital
  $ 138,987,727  
      Undistributed net investment income
    18,166  
      Accumulated net realized loss on investments
    (432,576 )
      Net unrealized appreciation on investments
    773,197  
                  Net Assets
  $ 139,346,514  
         
Net Asset Value, Offering Price and Redemption Price Per Share
  $ 10.08  
         
Shares Issued and Outstanding (Unlimited number of shares authorized, par value $0.01)
    13,821,604  

The accompanying notes are an integral part of these financial statements.




 
11

 
PIA Short-Term Securities Fund
Statement of Operations – Year Ended November 30, 2013

Investment Income:
     
      Interest
  $ 1,184,556  
            Total investment income
    1,184,556  
         
Expenses:
       
      Investment advisory fees (Note 4)
    283,265  
      Transfer agent fees and expenses (Note 4)
    101,735  
      Fund accounting fees (Note 4)
    61,742  
      Administration fees (Note 4)
    47,820  
      Registration fees
    29,071  
      Audit fees
    17,999  
      Custody fees (Note 4)
    17,035  
      Reports to shareholders
    10,460  
      Trustees’ fees
    9,103  
      Legal fees
    7,262  
      Insurance
    6,679  
      Chief Compliance Officer fee (Note 4)
    6,578  
      Miscellaneous
    9,564  
            Total expenses
    608,313  
      Less: Fee waiver by adviser (Note 4)
    (112,599 )
            Net expenses
    495,714  
                  Net investment income
    688,842  
         
Realized and Unrealized Gain/(Loss) on Investments:
       
      Net realized gain on investments
    91,943  
      Net change in unrealized appreciation on investments
    (328,359 )
            Net loss on investments
    (236,416 )
      Net increase in net assets resulting from operations
  $ 452,426  
 
The accompanying notes are an integral part of these financial statements.




 
12

 
PIA Short-Term Securities Fund
Statements of Changes in Net Assets

   
Year
   
Year
 
   
Ended
   
Ended
 
   
November 30,
   
November 30,
 
   
2013
   
2012
 
Increase/(Decrease) in Net Assets From
           
Operations:
           
      Net investment income
  $ 688,842     $ 618,007  
      Net realized gain on investments
    91,943       32,755  
      Net change in unrealized appreciation/(depreciation) on investments
    (328,359 )     104,127  
      Net increase in net assets resulting from operations
    452,426       754,889  
                 
Distributions Paid to Shareholders:
               
      Distributions from net investment income
    (739,924 )     (690,704 )
      Distributions from net realized gains on investments
           
      Total distributions paid to shareholders
    (739,924 )     (690,704 )
                 
Capital Share Transactions:
               
      Proceeds from shares sold
    78,049,656       79,965,510  
      Distributions reinvested
    366,383       267,100  
      Payment for shares redeemed
    (109,126,269 )     (81,460,970 )
      Net decrease in net assets from capital share transactions
    (30,710,230 )     (1,228,360 )
      Total decrease in net assets
    (30,997,728 )     (1,164,175 )
                 
Net Assets, Beginning of Year
    170,344,242       171,508,417  
Net Assets, End of Year
  $ 139,346,514     $ 170,344,242  
Includes Undistributed Net Investment Income of
  $ 18,166     $ 9,352  
                 
Transactions in Shares:
               
      Shares sold
    7,742,475       7,912,068  
      Shares issued on reinvestment of distributions
    36,351       26,437  
      Shares redeemed
    (10,820,041 )     (8,060,377 )
      Net decrease in shares outstanding
    (3,041,215 )     (121,872 )

The accompanying notes are an integral part of these financial statements.




 
13

 
PIA Short-Term Securities Fund
Financial Highlights

   
Year Ended November 30,
 
   
2013
   
2012
   
2011
   
2010
   
2009
 
Per Share Operating Performance
                             
(For a fund share outstanding throughout each year)
                             
                               
Net asset value, beginning of year
  $ 10.10     $ 10.10     $ 10.11     $ 10.12     $ 10.06  
                                         
Income From Investment Operations:
                                       
Net investment income
    0.05       0.04       0.05       0.07       0.18  
Net realized and unrealized gain/(loss) on investments
    (0.02 )     0.00 *     (0.00 )*     0.00 *     0.06  
Total from investment operations
    0.03       0.04       0.05       0.07       0.24  
                                         
Less Distributions:
                                       
Distributions from net investment income
    (0.05 )     (0.04 )     (0.06 )     (0.08 )     (0.18 )
Total distributions
    (0.05 )     (0.04 )     (0.06 )     (0.08 )     (0.18 )
                                         
Net asset value, end of year
  $ 10.08     $ 10.10     $ 10.10     $ 10.11     $ 10.12  
                                         
Total Return
    0.34 %     0.41 %     0.47 %     0.72 %     2.45 %
                                         
Ratios/Supplemental Data:
                                       
Net assets, end of year (in 000’s)
  $ 139,347     $ 170,344     $ 171,508     $ 154,948     $ 158,124  
Ratio of expenses to average net assets:
                                       
      Net of fee waivers and reimbursements
    0.35 %     0.35 %     0.35 %     0.35 %     0.35 %
      Before fee waivers and reimbursements
    0.43 %     0.38 %     0.39 %     0.40 %     0.39 %
Ratio of net investment income to average net assets:
                                       
      Net of fee waivers and reimbursements
    0.49 %     0.36 %     0.51 %     0.67 %     1.58 %
      Before fee waivers and reimbursements
    0.41 %     0.33 %     0.47 %     0.62 %     1.54 %
Portfolio turnover rate
    56 %     53 %     11 %     59 %     52 %

*  Amount is less than $0.01.

The accompanying notes are an integral part of these financial statements.




 
14

 
PIA Short-Term Securities Fund
Notes to Financial Statements – November 30, 2013

Note 1 – Organization
 
The PIA Short-Term Securities Fund (the “Fund”) is a series of Advisors Series Trust (the “Trust”), which is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company.  The investment objective of the PIA Short-Term Securities Fund (the “Short-Term Fund”) is to seek a high level of current income, consistent with low volatility of principal through investing in short-term investment grade debt securities.  The Short-Term Fund commenced operations on April 22, 1994.
 
Note 2 – Significant Accounting Policies
 
The following is a summary of significant accounting policies consistently followed by the Fund in the preparation of its financial statements.  These policies are in conformity with accounting principles generally accepted in the United States of America.
 
Security Valuation – All investments in securities are recorded at their estimated fair value, as described in Note 3.
 
Securities Purchased on a When-Issued Basis – Delivery and payment for securities that have been purchased by the Fund on a forward-commitment or when-issued basis can take place up to a month or more after the transaction date.  During this period, such securities are subject to market fluctuations.  The Fund is required to hold and maintain until the settlement date, cash or other liquid assets in an amount sufficient to meet the purchase price.  The purchase of securities on a when-issued or forward-commitment basis may increase the volatility of the Fund’s net asset value if the Fund makes such purchases while remaining substantially fully invested.  In connection with the ability to purchase securities on a when-issued basis, the Fund may also enter into dollar rolls in which the Fund sells securities purchased on a forward-commitment basis and simultaneously contract with a counterparty to repurchase similar (same type, coupon, and maturity), but not identical securities on a specified future date.  As an inducement for the Fund to “rollover” its purchase commitments, the Fund receives negotiated amounts in the form of reductions of the purchase price of the commitment.  Dollar rolls are considered a form of leverage.
 
Federal Income Taxes – It is the Fund’s policy to comply with the requirements of Subchapter M of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders.  Therefore, no Federal income or excise tax provision is required.
 
The Fund recognizes the tax benefits of uncertain tax positions only where the position is “more likely than not” to be sustained assuming examination by tax authorities.  Management has analyzed the Fund’s tax positions, and has concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions taken on returns filed for open tax years 2010 – 2012, or expected to be taken in the Fund’s 2013 tax returns.  The Fund identifies its major tax jurisdictions as U.S. Federal and the state of Wisconsin; however the Fund is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next twelve months.
 
Expenses – The Fund is charged for those expenses that are directly attributable to the Fund, such as investment advisory and custodian fees.  Expenses that are not directly attributable to the Fund are typically allocated among the Funds in proportion to their respective net assets.
 

 
 

 
15

 
PIA Short-Term Securities Fund
Notes to Financial Statements – November 30, 2013 (continued)

 
Securities Transactions and Investment Income – Security transactions are accounted for on a trade date basis.  Realized gains and losses on sales of securities are calculated on the basis of identified cost.  Interest income is recorded on an accrual basis.  Discounts and premiums on securities purchased are amortized over the life of the respective security.
 
Distributions to Shareholders – Distributions to shareholders are recorded on the ex-dividend date.  The Fund distributes substantially all net investment income, if any, monthly and net realized gains, if any, annually.  The amount and character of income and net realized gains to be distributed are determined in accordance with Federal income tax rules and regulations, which may differ from accounting principles generally accepted in the United States of America.  To the extent that these differences are attributable to permanent book and tax accounting differences, the components of net assets have been adjusted.
 
Reclassification of Capital Accounts – Accounting principles generally accepted in the United States of America require that certain components of net assets relating to permanent differences be reclassified between financial and tax reporting.  These reclassifications have no effect on net assets or net asset value per share.
 
For the year ended November 30, 2013, the Fund made the following permanent tax adjustments on the statement of assets and liabilities:
 
 
Undistributed Net
Accumulated Net Realized
Paid-In
 
Investment Income
Loss on Investments
Capital
Short-Term Securities Fund
$59,896
$123,207
$(183,103)
 
Guarantees and Indemnifications – In the normal course of business, the Fund enters into contracts with service providers that contain general indemnification clauses.  The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims against the Fund that have not yet occurred.  Based on experience, the Fund expects the risk of loss to be remote.
 
Use of Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operation during the reporting period.  Actual results could differ from those estimates.
 
Events Subsequent to the Fiscal Year End – In preparing the financial statements as of November 30, 2013, management considered the impact of subsequent events for the potential recognition or disclosure in these financial statements.
 
Note 3 – Securities Valuation
 
The Fund has adopted authoritative fair value accounting standards which establish an authoritative definition of fair value and set out a hierarchy for measuring fair value.  These standards require additional disclosures about the various inputs and valuation techniques used to develop the measurements of fair value, a discussion in changes in valuation techniques and related inputs during the period and expanded disclosure of valuation levels for major security types.  These inputs are summarized in the three broad levels listed below:
 

 

 

 

 
16

 
PIA Short-Term Securities Fund
Notes to Financial Statements – November 30, 2013 (continued)

 
 
Level 1 –
Unadjusted quoted prices in active markets for identical assets or liabilities that the Fund has the ability to access.
 
 
Level 2 –
Observable inputs other than quoted prices included in level 1 that are observable for the asset or liability, either directly or indirectly.  These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data.
 
 
Level 3 –
Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumptions about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available.
 
Following is a description of the valuation techniques applied to the Fund’s major categories of assets and liabilities measured at fair value on a recurring basis.  The Fund’s investments are carried at fair value.
 
Investment Companies – Investments in open-end mutual funds are valued at their net asset value per share.  To the extent, these securities are actively traded and valuation adjustments are not applied, they are categorized in level 1 of the fair value hierarchy.
 
  Corporate Bonds – Corporate bonds, including listed issues, are valued at market on the basis of valuations furnished by an independent pricing service which utilizes both dealer-supplied valuations and formula-based techniques.  The pricing service may consider recently executed transactions in securities of the issuer or comparable issuers, market price quotations (where observable), bond spreads, and fundamental data relating to the issuer.  Most corporate bonds are categorized in level 2 of the fair value hierarchy.
 
Foreign Securities – Foreign economies may differ from the U.S. economy and individual foreign companies may differ from domestic companies in the same industry.
 
Foreign companies or entities are frequently not subject to accounting and financial reporting standards applicable to domestic companies, and there may be less information available about foreign issuers.  Securities of foreign issuers are generally less liquid and more volatile than those of comparable domestic issuers.  There is frequently less government regulation of broker-dealers and issuers than in the United States.  In addition, investments in foreign countries are subject to the possibility of expropriation, confiscatory taxation, political or social instability or diplomatic developments that could adversely affect the value of those investments.
 
U.S. Government Securities – U.S. government securities are normally valued using a model that incorporates market observable data such as reported sales of similar securities, broker quotes, yields, bids, offers, and reference data.  Certain securities are valued principally using dealer quotations.  U.S. government securities are typically categorized in level 2 of the fair value hierarchy.
 
U.S. Government Agency Securities – U.S. government agency securities are comprised of two main categories consisting of agency issued debt and mortgage pass-throughs.  Agency issued debt securities are generally valued in a manner similar to U.S. government securities.  Mortgage pass-throughs include to-be-announced (“TBAs”) securities
 

 

 

 

 
17

 
PIA Short-Term Securities Fund
Notes to Financial Statements – November 30, 2013 (continued)

 
and mortgage pass-through certificates.  TBA securities and mortgage pass-throughs are generally valued using dealer quotations.  These securities are typically categorized in level 2 of the fair value hierarchy.
 
Derivative Instruments – Listed derivatives that are actively traded are valued based on quoted prices from the exchange.  Futures contracts are valued at the last sale price at the close of trading on the relevant exchange.  If there was no sale on the applicable exchange on such day, they are valued at the mean of the quoted bid and asked prices as of the close of such exchange.  The Fund did not hold derivative instruments during the year ended November 30, 2013.
 
Short-Term Securities – Short-term securities which mature in 60 days or less are valued at amortized cost (unless the Board of Trustees determines that this method does not represent fair value).  Short-term investments which mature after 60 days are valued at market.  To the extent the inputs are observable and timely, these securities would be classified in level 2 of the fair value hierarchy.
 
Illiquid Securities – A security may be considered illiquid if it lacks a readily available market.  Securities are generally considered liquid if they can be sold or disposed of in the ordinary course of business within seven days at approximately the price at which the security is valued by the Fund.  Illiquid securities may be valued under methods approved by the Fund’s Board of Trustees as reflecting fair value.  The Fund intends to hold no more than 15% of its net assets in illiquid securities.
 
Certain restricted securities may be considered illiquid.  Restricted securities are often purchased in private placement transactions, are not registered under the Securities Act of 1933, may have contractual restrictions on resale, and may be valued under methods approved by the Fund’s Board of Trustees as reflecting fair value.  Certain restricted securities eligible for resale to qualified institutional investors, including Rule 144A securities, are not subject to the limitation on the Fund’s investment in illiquid securities if they are determined to be liquid in accordance with procedures adopted by the Fund’s Board of Trustees.  As of November 30, 2013, Pacific Income Advisers, Inc., the adviser, has determined that the Rule 144A securities held by the Fund are considered liquid.
 
The Board of Trustees has delegated day-to-day valuation issues to a Valuation Committee of the Trust which is comprised of representatives from U.S. Bancorp Fund Services, LLC, the Fund’s administrator.  The function of the Valuation Committee is to value securities where current and reliable market quotations are not readily available or the closing price does not represent fair value by following procedures approved by the Board of Trustees.  These procedures consider many factors, including the type of security, size of holding, trading volume and news events.  All actions taken by the Valuation Committee are subsequently reviewed and ratified by the Board of Trustees.
 
Depending on the relative significance of the valuation inputs, fair valued securities may be classified in either level 2 or level 3 of the fair value hierarchy.
 
The inputs or methodology used for valuing securities are not an indication of the risk associated with investing in those securities.  The following is a summary of the inputs used to value the Fund’s securities as of November 30, 2013:
 
 
 

 
18

 
PIA Short-Term Securities Fund
Notes to Financial Statements – November 30, 2013 (continued)
 
Short-Term Fund
     
 
Level 1
   
Level 2
   
Level 3
   
Total
 
 
    Fixed Income
                       
 
       Corporate Bonds
  $     $ 63,692,743     $     $ 63,692,743  
 
       Mortgage-Backed Securities
          23,258,248       2,010,000       25,268,248  
 
       U.S. Government Agencies
                               
 
         and Instrumentalities
          39,057,794             39,057,794  
 
    Total Fixed Income
          126,008,785       2,010,000       128,018,785  
 
    Short-Term Investments
    3,724,499       8,999,795             12,724,294  
 
    Total Investments
  $ 3,724,499     $ 135,008,580     $ 2,010,000     $ 140,743,079  
 
Refer to the Fund’s Schedule of Investments for a detailed break-out of securities.  Transfers between levels are recognized at November 30, 2013, the end of the reporting period.  The Fund recognized no transfers to/from level 1 or level 2.
 
The following is a reconciliation of the Fund’s level 3 investments for which significant unobservable inputs were used in determining value.
 
     
Investments in Securities, at Value
 
     
Mortgage-Backed Securities
 
 
Balance as of November 30, 2012
  $  
 
Accrued discounts/premiums
     
 
Realized gain/(loss)
     
 
Change in unrealized appreciation/(depreciation)
    10,000  
 
Purchases
    2,000,000  
 
Sales
     
 
Transfers in and/or out of Level 3
     
 
Balance as of November 30, 2013
  $ 2,010,000  
 
The Fund’s primary pricing service was unable to provide pricing for one mortgage-backed security at November 30, 2013.  The Valuation Committee utilized an indicative market quotation or broker quote received from a broker-dealer considered by the Adviser to be a market participant.  The underlying inputs which support the broker quote utilized by the Valuation Committee are not observable.  Since the security’s fair value utilized significant unobservable inputs due to the lack of reliable market data, the security is categorized as level 3 of the fair value hierarchy.  Any significant change in the broker quote would have a direct change on the fair value of the security.
 
New Accounting Pronouncement – In January 2013, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) No. 2013-01 Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities .  This update gives additional clarification to the FASB ASU No. 2011-11 Disclosures about Offsetting Assets and Liabilities .  The amendments in this ASU require an entity to disclose information about offsetting and related arrangements to enable users of its financial statements to understand the effect of those arrangements on its financial position.  The ASU is effective for annual reporting periods beginning on or after January 1, 2013, and interim periods
 

 

 

 

 
19

 
PIA Short-Term Securities Fund
Notes to Financial Statements – November 30, 2013 (continued)

 
within those annual periods.  The guidance requires retrospective application for all comparative periods presented.  The Fund is currently evaluating the impact ASU 2013-01 will have on the financial statement disclosures.
 
Note 4 – Investment Advisory Fee and Other Transactions with Affiliates
 
The Fund has an investment advisory agreement with Pacific Income Advisers, Inc. (“PIA” or the “Adviser”) pursuant to which the Adviser is responsible for providing investment management services to the Fund.  The Adviser furnished all investment advice, office space and facilities, and provides most of the personnel needed by the Fund.  As compensation for its services, PIA is entitled to a fee, computed daily and payable monthly.  The Short-Term Fund pays fees calculated at an annual rate of 0.20% based upon the average daily net assets of the Fund.  For the year ended November 30, 2013, the Short-Term Fund incurred $283,265 in advisory fees.
 
The Fund is responsible for its own operating expenses.  The Adviser has contractually agreed to reduce fees payable to it by the Fund and to pay Fund operating expenses to the extent necessary to limit the Short-Term Fund’s aggregate annual operating expenses to 0.35% of average daily net assets.  The Adviser will continue the expense waiver and/or reimbursement through at least March 29, 2014.  Any such reduction made by the Adviser in its fees or payment of expenses which are the Fund’s obligation are subject to reimbursement by the Fund to the Adviser, if so requested by the Adviser, in subsequent fiscal years if the aggregate amount actually paid by the Fund toward the operating expenses for such fiscal year (taking into account the reimbursement) does not exceed the applicable limitation on Fund’s expenses.  The Adviser is permitted to be reimbursed only for fee reductions and expense payments made since March 30, 2011.  The Adviser may not recoup expense waivers and/or reimbursements made prior to March 30, 2011.  Any such reimbursement is also contingent upon Board of Trustees review and approval at the time the reimbursement is made.  Such reimbursement may not be paid prior to the Fund’s payment of current ordinary operating expenses.  For the year ended November 30, 2013, the Adviser reduced its fees and/or absorbed Fund expenses in the amount of $112,599 for the Short-Term Fund.  No amounts were reimbursed to the Adviser.  Cumulative expenses subject to recapture pursuant to the aforementioned conditions amounted to $218,960 for the Short-Term Fund at November 30, 2013.  The expense limitation will remain in effect through at least March 29, 2014, and may be terminated only by the Trust’s Board of Trustees.  Cumulative expenses subject to recapture expire as follows:
 
       
Short-Term Fund
 
 
Year
   
Amount
 
 
2014
    $ 45,518  
 
2015
      60,843  
 
2016
      112,599  
        $ 218,960  
 
U.S. Bancorp Fund Services, LLC (the “Administrator”) acts as the Fund’s Administrator under an Administration Agreement.  The Administrator prepares various federal and state regulatory filings, reports and returns for the Fund; prepares reports and materials to be supplied to the Trustees; monitors the activities of the Fund’s custodian, transfer agent and accountants; coordinates the preparation and payment of the Fund’s expenses and reviews the Fund’s expense accruals.
 
 
 
20

 
PIA Short-Term Securities Fund
Notes to Financial Statements – November 30, 2013 (continued)

 
U.S. Bancorp Fund Services, LLC (“USBFS”) also serves as the fund accountant and transfer agent to the Fund.  U.S. Bank N.A., an affiliate of USBFS, serves as the Fund’s custodian.
 
Quasar Distributors, LLC (the “Distributor”) acts as the Fund’s principal underwriter in a continuous public offering of the Fund’s shares.  The Distributor is an affiliate of the Administrator.
 
Certain officers of the Fund are employees of the Administrator.
 
For the year ended November 30, 2013, the Fund incurred the following expenses for administration, fund accounting, transfer agency, custody, and Chief Compliance Officer fees:
 
     
Short-Term Fund
 
 
Administration
  $ 47,820  
 
Fund Accounting
    61,742  
 
Transfer Agency
       
 
  (excludes out-of-pocket expenses and sub-ta fees)
    80,465  
 
Custody
    17,035  
 
Chief Compliance Officer
    6,578  
 
At November 30, 2013, the Fund had payables due to USBFS for administration, fund accounting, transfer agency and Chief Compliance Officer fees and to U.S. Bank, N.A. for custody fees in the following amounts:
 
     
Short-Term Fund
 
 
Administration
  $ 7,416  
 
Fund Accounting
    9,612  
 
Transfer Agency
       
 
  (excludes out-of-pocket expenses and sub-ta fees)
    13,741  
 
Custody
    2,852  
 
Chief Compliance Officer
    994  

Note 5 – Purchases and Sales of Securities
 
     
Non-Government
   
Government
 
     
Purchases
   
Sales
   
Purchases
   
Sales
 
 
Short-Term Fund
  $ 61,715,588     $ 74,391,482     $     $ 33,056,463  
 
Purchases and sales of U.S. Government securities include only long-term purchases and sales of securities directly issued by the U.S. Government such as U.S. Treasury notes and bonds.
 
Note 6 – Line of Credit
 
The Short-Term Fund has a line of credit in the amount of $24,200,000.  The line of credit is intended to provide short-term financing, if necessary, subject to certain restrictions, in connection with shareholder redemptions.  The credit facility is with the Fund’s custodian, U.S. Bank N.A.  The Fund did not draw upon its line of credit during the year ended November 30, 2013.
 
 
21

 
PIA Short-Term Securities Fund
Notes to Financial Statements – November 30, 2013 (continued)

 
Note 7 – Federal Income Tax Information
 
Net investment income and net realized gains/(losses) differ for financial statement and tax purposes due to differing treatments of paydowns.
 
The tax character of distributions paid during the years ended November 30, 2013 and November 30, 2012 was as follows:
 
     
Short-Term Fund
 
     
November 30, 2013
   
November 30, 2012
 
 
Ordinary income
  $ 739,924     $ 690,704  
 
Ordinary income distributions may include dividends paid from short-term capital gains.
 
As of November 30, 2013, the components of accumulated earnings/(losses) on a tax basis were as follows:
 
     
Short-Term Fund
 
 
Cost of investments (a)
  $ 139,969,882  
 
Gross unrealized appreciation
    933,967  
 
Gross unrealized depreciation
    (160,770 )
 
Net unrealized appreciation
    773,197  
 
Undistributed ordinary income
    18,166  
 
Undistributed long-term capital gains
     
 
Total distributable earnings
    18,166  
 
Other accumulated losses
    (432,576 )
 
Total accumulated earnings
  $ 358,787  
 
 
(a)
The book-basis and tax-basis net unrealized appreciation in the Short-Term Fund are the same.

The Short-Term Fund had tax capital losses which may be carried over to offset future gains.  Such losses expire as follows:

             
Short-Term
 
   
2014
2015
2017
2018
2019
Indefinite
Total
 
Short-Term Fund
$218,276
$43,801
$45,313
$56,182
$63,174
$5,830
$432,576




 
22

 
PIA Funds
Report of Independent Registered Public Accounting Firm

To the Board of Trustees
Advisors Series Trust and
Shareholders of
PIA Short-Term Securities Fund
 
We have audited the accompanying statement of assets and liabilities of the PIA Short-Term Securities Fund, a series of Advisors Series Trust (the “Trust”), including the schedule of investments, as of November 30, 2013, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended.  These financial statements and financial highlights are the responsibility of the Trust’s management.  Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.
 
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement.  The Trust is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.  Our audits included 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 Trust’s internal control over financial reporting.  Accordingly, we express no such opinion.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.  Our procedures included confirmation of securities owned as of November 30, 2013, by correspondence with the custodian and brokers or by other appropriate auditing procedures where replies from brokers were not received.  We believe that our audits provide a reasonable basis for our opinion.
 
In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the PIA Short-Term Securities Fund, as of November 30, 2013, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.
 
 
TAIT, WELLER & BAKER LLP
Philadelphia, Pennsylvania
January 29, 2014
 
 

 
23

 
PIA Short-Term Securities Fund
Notice to Shareholders – November 30, 2013
(Unaudited)

 
How to Obtain a Copy of the Fund’s Proxy Voting Policies
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, by calling 1-800-251-1970, or on the Securities and Exchange Commission’s (“SEC”) website at http://www.sec.gov.
 
How to Obtain a Copy of the Fund’s Proxy Voting Records for the 12-Month Period Ended June 30
Information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available without charge, upon request, by calling 1-800-251-1970.  Furthermore, you can obtain the Fund’s proxy voting records on the SEC’s website at http://www.sec.gov.
 
Quarterly Filings on Form N-Q
The Fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q.  The Fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov.  The Fund’s Form N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC, and information on the operation of the Public Reference Room may be obtained by calling 1-202-551-8090.  Information included in the Fund’s Form N-Q is also available by calling 1-800-251-1970.
 
Householding
In an effort to decrease costs, the Fund intends to reduce the number of duplicate prospectuses, annual and semi-annual reports, proxy statements and other similar documents you receive by sending only one copy of each to those addresses shared by two or more accounts and to shareholders the Transfer Agent reasonably believes are from the same family or household.  Once implemented, if you would like to discontinue householding for your accounts, please call toll-free at 1-800-251-1970 to request individual copies of these documents.  Once the Transfer Agent receives notice to stop householding, the Transfer Agent will begin sending individual copies thirty days after receiving your request.  This policy does not apply to account statements.
 
 
 
24

 
PIA Short-Term Securities Fund
Information About Trustees and Officers
(Unaudited)

This chart provides information about the Trustees and Officers who oversee the Fund.  Officers elected by the Trustees manage the day-to-day operations of the Fund and execute policies formulated by the Trustees.
 
       
Number of
 
       
Portfolios
 
     
Principal
in Fund
Other
   
Term of Office
Occupation
Complex
Directorships
Name, Address
Position Held
and Length of
During Past
Overseen by
Held During
and Age
with the Trust
Time Served
Five Years
Trustee (2)
Past Five Years
           
Independent Trustees (1)
         
           
Donald E. O’Connor
Trustee
Indefinite term
Retired; former Financial
6
Trustee,
(age 77)
 
since
Consultant and former
 
Advisors Series
615 E. Michigan Street
 
February 1997.
Executive Vice President and
 
Trust (for series
Milwaukee, WI 53202
   
Chief Operating Officer of ICI
 
not affiliated
     
Mutual Insurance Company
 
with the Funds);
     
(until January 1997).
 
Trustee, The
         
Forward Funds
         
(31 portfolios).
           
George J. Rebhan
Trustee
Indefinite term
Retired; formerly President,
6
Trustee,
(age 79)
 
since
Hotchkis and Wiley Funds
 
Advisors Series
615 E. Michigan Street
 
May 2002.
(mutual funds) (1985 to 1993).
 
Trust (for series
Milwaukee, WI 53202
       
not affiliated
         
with the Funds);
         
Independent
         
Trustee from
         
1999 to 2009,
         
E*TRADE
         
Funds.
           
George T. Wofford
Trustee
Indefinite term
Retired; formerly Senior Vice
6
Trustee,
(age 74)
 
since
President, Federal Home Loan
 
Advisors Series
615 E. Michigan Street
 
February 1997.
Bank of San Francisco.
 
Trust (for series
Milwaukee, WI 53202
       
not affiliated
         
with the Funds).
Interested Trustee
         
           
Joe D. Redwine (3)
Interested
Indefinite term
President, CEO, U.S. Bancorp
6
Trustee,
(age 66)
Trustee
since
Fund Services, LLC
 
Advisors Series
615 E. Michigan Street
 
September 2008.
(May 1991 to present).
 
Trust (for series
Milwaukee, WI 53202
       
not affiliated
         
with the Funds).




 
25

 
PIA Short-Term Securities Fund
Information About Trustees and Officers (continued)
(Unaudited)

   
Term of Office
 
Name, Address
Position Held
and Length of
Principal Occupation
and Age
with the Trust
Time Served
During Past Five Years
       
Officers
     
       
Joe D. Redwine
Chairman and
Indefinite term
President, CEO, U.S. Bancorp Fund Services, LLC
(age 66)
Chief Executive
since
(May 1991 to present).
615 E. Michigan Street
Officer
September 2007.
 
Milwaukee, WI 53202
     
       
Douglas G. Hess
President and
Indefinite term
Senior Vice President, Compliance and Administration,
(age 46)
Principal
since
U.S. Bancorp Fund Services, LLC (March 1997 to present).
615 E. Michigan Street
Executive
June 2003.
 
Milwaukee, WI 53202
Officer
   
       
Cheryl L. King
Treasurer and
Indefinite term
Vice President, Compliance and Administration,
(age 52)
Principal
since
U.S. Bancorp Fund Services, LLC (October 1998 to present).
615 E. Michigan Street
Financial
December 2007.
 
Milwaukee, WI 53202
Officer
   
       
Kevin J. Hayden
Assistant
Indefinite term
Assistant Vice President, Compliance and Administration,
(age 42)
Treasurer
since
U.S. Bancorp Fund Services, LLC (June 2005 to present).
615 E. Michigan Street
 
September 2013.
 
Milwaukee, WI 53202
     
       
Albert Sosa
Assistant
Indefinite term
Assistant Vice President, Compliance and Administration,
(age 43)
Treasurer
since
U.S. Bancorp Fund Services, LLC (June 2004 to present).
615 E. Michigan Street
 
September 2013.
 
Milwaukee, WI 53202
     
       
Michael L. Ceccato
Vice President,
Indefinite term
Senior Vice President, U.S. Bancorp Fund Services, LLC
(age 56)
Chief
since
(February 2008 to present); General Counsel/Controller,
615 E. Michigan Street
Compliance
September 2009.
Steinhafels, Inc. (September 1995 to February 2008).
Milwaukee, WI 53202
Officer and
   
 
AML Officer
   
       
Jeanine M. Bajczyk, Esq.
Secretary
Indefinite term
Senior Vice President and Counsel, U.S. Bancorp Fund
(age 48)
 
since
Services, LLC (May 2006 to present).
615 E. Michigan Street
 
June 2007.
 
Milwaukee, WI 53202
     

(1)
The Trustees of the Trust who are not “interested persons” of the Trust as defined under the 1940 Act (“Independent Trustees”).
(2)
As of November 30, 2013, the Trust is comprised of 40 active portfolios managed by unaffiliated investment advisors.  The term “Fund Complex” applies only to the Fund and the PIA BBB Bond Fund, the PIA High Yield Fund, the PIA High Yield (MACS) Fund, the PIA MBS Bond Fund and the PIA Short-Term Duration Bond Fund.  The Funds do not hold themselves out as related to any other series within the Trust for investment purposes, nor does it share the same investment adviser with any other series.
(3)
Mr. Redwine is an “interested person” of the Trust as defined by the 1940 Act.  Mr. Redwine is an interested Trustee of the Trust by virtue of the fact that he is an interested person of Quasar Distributors, LLC who acts as principal underwriter to the series of the Trust.
 
The Statement of Additional Information includes additional information about the Fund’s Trustees and Officers and is available, without charge, upon request by calling 1-800-251-1970.
 

 

 

 

 
26

 
PIA Short-Term Securities Fund
Approval of Investment Advisory Agreement
(Unaudited)

At a meeting held on June 11-12, 2012, the Board of Trustees (the “Board”) of Advisors Series Trust (the “Trust”), including all the persons who are Independent Trustees as defined under the Investment Company Act of 1940, as amended, considered and approved the initial investment advisory agreement (“Advisory Agreement”) between the Trust and Pacific Income Advisers, Inc. (the “Adviser”) for the PIA Short Duration Bond Fund (the “Fund”) for a period not to exceed two years.  Prior to this meeting, the Board received and reviewed substantial information regarding the Fund, the Adviser and the services expected to be provided by the Adviser to the Fund under the Advisory Agreement.  This information formed the primary (but not exclusive) basis for the Board’s determinations.  Below is a summary of the factors considered by the Board and the conclusions that formed the basis for the Board’s approval of the initial Advisory Agreement:
 
The Board members present, which includes a majority of Independent Trustees, took into consideration, among other things, the nature, extent and quality of the services to be provided by the Adviser under the Advisory Agreement.  The Board considered the Adviser’s specific responsibilities in all aspects of day-to-day management of the Fund.  In this regard, the Board considered the qualifications, experience and responsibilities of the portfolio managers, as well as the responsibilities of other key personnel of the Adviser that would be involved in the day-to-day activities of the Fund.  The Board also considered the resources and compliance structure of the Adviser, including information regarding the compliance program, chief compliance officer and the Adviser’s compliance record and business continuity plan.  The Board also considered the Adviser’s business plan, noting that the Adviser currently manages several other active mutual funds which are each a separate series of Advisors Series Trust.  After discussion, the Board concluded that the Adviser has the quality and depth of personnel, resources, investment methods and compliance policies and procedures essential to performing its duties under the Advisory Agreement and that the nature, overall quality, cost and extent of such management services will be satisfactory.
 
The Trustees then discussed the expected costs of the services to be provided by the Adviser and the structure and level of the Adviser’s fees under the Advisory Agreement.  In considering the advisory fee and anticipated total fees and expenses of the Fund, the Board reviewed and compared the Fund’s anticipated fees and expenses to those funds in its Lipper peer group, as well as the fees and expenses for similar types of accounts managed by the Adviser.  The Board viewed such information as a whole as useful in assessing whether the Adviser would be able to provide services at a cost that was competitive with other similar funds and consistent with an arm’s length bargaining process.  The Trustees also took into account the proposed expense waivers.
 
The Board noted that the Adviser was agreeing to waive its advisory fees or reimburse the Fund for certain of the Fund’s expenses to the extent necessary to maintain an annual expense ratio of 1.00% for Class A shares and 0.75% for Class I shares (the “Expense Caps”).
 
The Board noted that the Fund’s expected total operating expenses for Class I shares were below the peer group median and average, though the contractual advisory fee was above the peer group median and average and the Fund’s expected total operating expenses for Class A shares were above the peer group median and average.  The Board also noted that the Fund’s expected contractual advisory fee was in-line with the fee charged by the Adviser to many of its separately managed account clients.

 

 
27

 
PIA Short-Term Securities Fund
Approval of Investment Advisory Agreement (continued)
(Unaudited)

The Board concluded that the fees to be paid to the Adviser were fair and reasonable.
 
The Board also considered economies of scale that would be expected to be realized by the Adviser as the assets of the Fund grew.  The Board noted that the Adviser would be contractually agreeing to reduce its advisory fees or reimburse Fund expenses indefinitely, but in no event for less than a one year term, so that the Fund does not exceed the Expense Caps.  The Board concluded that there were no effective economies of scale to be shared by the Adviser at this time, but indicated that they would continue to examine this issue to ensure that economies of scale are being shared with the Fund as asset levels increase.
 
The Board then considered the profits expected to be realized by the Adviser from its relationship with the Fund.  The Board reviewed the Adviser’s financial information and took into account both the expected direct benefits and the indirect benefits to the Adviser from advising the Fund.  The Board considered the expected profitability to the Adviser from its relationship with the Fund and considered any additional benefits that may be derived by the Adviser from its relationship with the Fund.  After such review, the Board determined that the expected profitability to the Adviser with respect to the Advisory Agreement was not excessive, and that the Adviser had sufficient resources to support the services it provides to the Fund.
 
No single factor was determinative of the Board’s decision to approve the Advisory Agreement, but rather the Board based its determination on the total mix of information available to them.  Based on a consideration of all the factors in their totality, the Board determined that the advisory arrangement with the Adviser, including the advisory fee, was fair and reasonable.  The Board, including a majority of Independent Trustees, therefore determined that the approval of the Advisory Agreement was in the best interests of the Fund and its shareholders.
 




 
28

 
PRIVACY NOTICE

The Fund collects non-public information about you from the following sources:
 
•  Information we receive about you on applications or other forms;
 
•  Information you give us orally; and/or
 
•  Information about your transactions with us or others.
 
We do not disclose any non-public personal information about our customers or former customers without the customer’s authorization, except as permitted by law or in response to inquiries from governmental authorities.  We may share information with affiliated and unaffiliated third parties with whom we have contracts for servicing the Fund.  We will provide unaffiliated third parties with only the information necessary to carry out their assigned responsibilities.  We maintain physical, electronic and procedural safeguards to guard your non-public personal information and require third parties to treat your personal information with the same high degree of confidentiality.
 
In the event that you hold shares of the Fund through a financial intermediary, including, but not limited to, a broker-dealer, bank, or trust company, the privacy policy of your financial intermediary would govern how your non-public personal information would be shared by those entities with unaffiliated third parties.
 




 
 

 

 

 
(This Page Intentionally Left Blank.)
 

 

 

 
 

 

Adviser
Pacific Income Advisers, Inc.
1299 Ocean Avenue, Suite 210
Santa Monica, CA  90401


Distributor
Quasar Distributors, LLC
615 East Michigan Street
Milwaukee, WI  53202


Transfer Agent
U.S. Bancorp Fund Services, LLC
615 East Michigan Street
Milwaukee, WI  53202
(800) 251-1970


Custodian
U.S. Bank N.A.
1555 North River Center Drive, Suite 302
Milwaukee, WI  53212


Independent Registered Public Accounting Firm
Tait, Weller & Baker LLP
1818 Market Street, Suite 2400
Philadelphia, PA  19103


Legal Counsel
Paul Hastings LLP
75 East 55th Street
New York, NY  10022





Past performance results shown in this report should not be considered a representation of future performance.  Share price and returns will fluctuate so that shares, when redeemed, may be worth more or less than their original cost.  Statements and other information herein are dated and are subject to change.




 
 

 

 
PIA FUNDS LOGO
 
 
PIA Funds

– PIA High Yield Fund
Investor Class



 

 
Annual Report
 
November 30, 2013
 

 

 
 

 
 

 
PIA High Yield Fund

Dear Shareholder:
 
We are pleased to provide you with this annual report for the twelve month period ended November 30, 2013 regarding the following series of the PIA Mutual Funds for which Pacific Income Advisers, Inc. (PIA) is the adviser: the PIA High Yield Fund.
 
During the periods ended November 30, 2013, the High Yield Fund’s total return, including the reinvestment of dividends, was as follows:
 
       
Since Inception
     
24 Months
(12/31/10)
 
6 Months
12 Months
(Annualized)
(Annualized)
PIA High Yield Fund
2.60%
9.06%
11.71%
8.77%
Barclays Capital U.S. Corporate High-Yield Index
2.61%
8.55%
12.72%
9.40%
 
Performance data quoted represents past performance; does not guarantee future results.  The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost.  Current performance of the Fund may be lower or higher than the performance quoted.  Performance data current to the most recent month end may be obtained by calling 1-800-251-1970.  Investment performance reflects fee waivers in effect.  In the absence of such waivers, total return would be reduced.
 
The Fund returned 9.06% after fees and expenses during the year ended November 30, 2013, exceeding the Barclays Capital U.S. Corporate High-Yield Index (the “Index”), which returned 8.55%.  The Fund’s total return includes 0.98% in Fund fees and expenses for the year ended November 30, 2013, compared to the benchmark index, which does not incur fees and expenses.  As stated in the current prospectus, the Fund’s gross expense ratio is 1.31% and the Fund’s Net Annual Fund Operating Expenses including acquired fund fees and expenses is 0.99%.
 
PIA has contractually agreed to waive all or a portion of its management fees and pay Fund expenses to ensure that Net Annual Fund Operating Expenses (excluding acquired fund fees and expenses, interest, taxes and extraordinary expenses) do not exceed 0.98% of the Fund’s average daily net assets through March 29, 2014.
 
The Fund’s portfolio benefited from its overweighting of relatively small bond issues, which significantly outperformed larger issues, and from its significant underweighting of BB rated bonds.  We continue to believe the greatest total return opportunities and lowest vulnerability to inflation are in our favored subsectors.  The maturity and duration of the Fund are shorter than the Index, and its weighted average coupon is higher.  The Fund also benefited from its deliberate underweighting of several industries which underperformed: housing, communications, gaming, utilities, and metals.  The Fund did experience the first default in its 35 month history, an oil service company called Platinum Energy Solutions, but its holding of Platinum bonds amounted to less than half a percent of the portfolio net asset value.
 
High yield bonds, returning 8.55% during the year ended November 2013, were by far the highest performing major sector in the U.S. fixed income universe; the second highest performing sector was the other major debt class with exposure to high yield issuers, senior secured leveraged loans, at 5.65%.  By contrast, investment grade corporates returned -1.44%, Treasuries returned -2.28%, emerging markets bonds returned -3.46%, and the U.S. Aggregate returned -1.61%, all using Barclays Capital indices.
 

 

 

 

 
1

 
PIA High Yield Fund

Conditions in the high yield market have continued the benign trends observed over the last several years.  Issuance of new bonds has been very high.  According to Credit Suisse, new primary high yield bond issuance during 2013 was $340 billion, just behind 2012’s record level of $347  billion.
 
Defensive refinancing has been the primary use of proceeds, and as a result the vast majority of bond maturities have been pushed several years into the future and corporate interest burdens have been reduced.  Corporate profitability has continued at historically strong levels, driving the average coverage of interest by operating cash flow, a key metric for our universe, near its all-time high.  Focusing on the credit quality of year-to-date issues in 2013, which by themselves constitute almost a quarter of the entire Index, credit statistics have been consistent with the last few years’ healthy levels, and are in fact slightly better than 2012.  Although the financial press frequently publishes anecdotal evidence of credit market deterioration and indiscipline, the objective marketwide data provides no evidence of “bubble” conditions in the high yield market.
 
The result of the above trends is that even in a macro environment of five straight years of subpar growth, marketwide default losses for the last twelve months, as measured by Credit Suisse, have been only 1.35%, and after unusually strong recoveries (post-default market prices) on defaults,  the net loss rate has been just 0.64%.  This is the fourth straight year in which default losses have been less than half the long-term average, and as of November 30, 2013, less than one percent of high yield bonds (measured at market values) are distressed (defined as a bond which has defaulted or is rated CC or C.)  Market participants expect defaults to trend up slightly in future years, remaining well below average until the next recession.  In such an environment, we believe that current credit spreads in the high yield market, compensate bondholders fairly for the credit risk borne.
 
Please take a moment to review the Fund’s statement of assets and liabilities and the results of operations for the year ended November 30, 2013.  We look forward to reporting to you again with the semi-annual report dated May 31, 2014.
 
LLOYD MCADAMS SIGNATURE

Lloyd McAdams
Chairman of the Board
Pacific Income Advisers, Inc.


 
Past performance is not a guarantee of future results.
 
Opinions expressed above are those of the adviser and are subject to change, are not guaranteed and should not be considered recommendations to buy or sell any security and should not be considered investment advice.
 
Must be preceded or accompanied by a prospectus.
 
Mutual fund investing involves risk.  Principal loss is possible.  Investments in debt securities typically decrease in value when interest rates rise.  This risk is usually greater for longer-term debt securities.  Investments in Asset-Backed and Mortgage-Backed Securities include additional risks that investors should be aware of such as credit risk, prepayment risk, possible illiquidity and default, as well as increased susceptibility to adverse economic developments.  The Fund may invest in foreign securities which involve greater volatility and political, economic
 

 

 

 

 
2

 
PIA High Yield Fund

 
and currency risks and differences in accounting methods.  Investment by the Fund in lower-rated and non-rated securities presents a greater risk of loss to principal and interest than higher-rated securities.  The Fund may also use options and future contracts, which have the risks of unlimited losses of the underlying holdings due to unanticipated market movements and failure to correctly predict the direction of securities prices, interest rates and currency exchange rates.  The Fund may invest in swap investment derivatives.  Derivatives involve risks different from, and in certain cases, greater than the risks presented by more traditional investments.
 
The Barclays Capital U.S. Corporate High-Yield Index measures the market of USD-denominated, non-investment grade, fixed rate, taxable corporate bonds.  Securities are classified as high yield if the middle rating of Moody’s, Fitch, and S&P is Ba1/BB+/BB+ or below after dropping the highest and lowest available ratings.  The index excludes emerging markets debt.  You cannot invest directly in an index.
 
The Barclays Capital Emerging Markets USD Aggregate Bond Index  is a flagship hard currency Emerging Markets debt benchmark that includes fixed and floating-rate U.S. dollar denominated debt issued from sovereign, quasi-sovereign, and corporate emerging markets issuers.
 
The Barclays Capital U.S. Aggregate Bond Index represents securities that are SEC-registered, taxable, and dollar denominated.  The Index covers the U.S. investment grade fixed rate bond market, with index components for government and corporate securities, mortgage pass-through securities, and asset-backed securities.
 
The Barclays Capital U.S. Corporate Investment Grade Index is a sub-index of the Barclays U.S. Credit Index, and includes U.S. dollar denominated securities publicly issued by U.S. and non-U.S. industrial, utility, and financial issuers that meed the specified maturity, liquidity, and quality requirements.
 
The Barclays Capital U.S. High-Yield Loans Index, also known as the Bank Loan Index, provides broad and comprehensive total return metrics of the universe of syndicated term loans.  To be included in the Index, a bank loan must be dollar denominated, have at least $150 million funded loan, a minimum term of one year, and a minimum initial spread of LIBOR +125.
 
The Barclays Capital U.S. Treasury Index includes public obligations of the U.S. Treasury with a remaining maturity of one year or more.
 
Bond ratings provide the probability of an issuer defaulting based on the analysis of the issuer’s financial condition and profit potential.  Bond rating services are provided by Standard & Poor’s, Moody’s Investors Service, and Fitch Investors Service.  Bond ratings start at AAA (denoting the highest investment quality) and usually end at D (meaning payment is in default).
 
Please refer to the Schedule of Investments in the report for complete holdings information.  Fund holdings and sector allocations are subject to change at any time and are not recommendations to buy or sell any security.  Investment performance reflects fee waivers in effect.  In the absence of such waivers, total return would be reduced.
 
Current and future portfolio holdings are subject to risk.  
 
Quasar Distributors, LLC, Distributor
 

 
3

 

PIA High Yield Fund


 
PIA HIGH YIELD FUND
Comparison of the change in value of a $10,000 investment in the
PIA High Yield Fund vs the Barclays Capital U.S. Corporate High-Yield Bond Index
 
 

Average Annual Total Return*
1 Year
Since Inception
PIA High Yield Fund
9.06%
8.77%
Barclays Capital U.S. Corporate High-Yield Bond Index
8.55%
9.40%
 
Performance data quoted represents past performance; past performance does not guarantee future results.  The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost.  Current performance of the Fund may be lower or higher than the performance quoted.  Performance data current to the most recent month end may be obtained by calling 1-800-251-1970.
 
This chart illustrates the performance of a hypothetical $10,000 investment made in the Fund on its inception date, December 31, 2010.
 
Returns reflect the reinvestment of dividends and capital gain distributions.  Fee waivers are in effect.  In the absence of fee waivers,  returns would be reduced.  The performance data and graph do not reflect the deduction of taxes that a shareholder may pay on dividends, capital gain distributions, or redemption of Fund shares.  This chart does not imply any future performance.
 
The Barclays Capital U.S. Corporate High-Yield Bond Index measures the market of USD-denominated, non-investment grade, fixed-rate, taxable corporate bonds.  Securities are classified as high yield if the middle rating of Moody’s, Fitch, and S&P is Ba1/BB+/BB+ or below after dropping the highest and lowest available ratings.  The index excludes emerging markets debt.
 
Indices do not incur expenses and are not available for investment.
 
*
Average Annual Total Return represents the average change in account value over the periods indicated.

 

 
4

 
PIA High Yield Fund
Expense Example – November 30, 2013
(Unaudited)

As a shareholder of a mutual fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, redemption fees, and exchange fees, and (2) ongoing costs, including management fees, distribution and/or service fees, and other fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the PIA High Yield Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (6/1/13 – 11/30/13).
 
Actual Expenses
The first line of the table below provides information about actual account values and actual expenses, with actual net expenses being limited to 0.98% per the operating expenses limitation agreement for the PIA High Yield Fund.  Although the Fund charges no sales loads or transaction fees, you will be assessed fees for outgoing wire transfers, returned checks, and stop payment orders at prevailing rates charged by U.S. Bancorp Fund Services, LLC, the Fund’s transfer agent.  The Example below includes, but is not limited to, management fees, fund accounting, custody and transfer agent fees.  You may use the information in the first line, together with the amount you invested, to estimate the expenses that you paid over the period.  Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
 
Hypothetical Example for Comparison Purposes
The second line of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratios and an assumed rate of return of 5% per year before expenses, which is different from the Fund’s actual returns.  The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period.  You may use this information to compare the ongoing costs of investing in the Fund and other funds.  To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.  Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads), redemption fees, or exchange fees.  Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
 
 
Beginning Account
Ending Account
Expenses Paid During
 
Value 6/1/13
Value 11/30/13
Period 6/1/13 – 11/30/13*
PIA High Yield Fund
     
Actual
$1,000.00
$1,026.00
$4.98
Hypothetical (5% return before expenses)
$1,000.00
$1,020.16
$4.96

*
Expenses are equal to the Fund’s annualized expense ratio, multiplied by the average account value over the period, multiplied by 183 (days in most recent fiscal half-year) / 365 days to reflect the one-half year expense.  The annualized expense ratio of the PIA High Yield Fund is 0.98%.




 
5

 
PIA High Yield Fund
Allocation of Portfolio Assets – November 30, 2013
(Unaudited)

Investments by Sector
As a Percentage of Total Investments
 
 




 
6

 
PIA High Yield Fund
Schedule of Investments – November 30, 2013

 
Principal Amount
     
Value
 
CORPORATE BONDS 91.5%
     
       
Aerospace/Defense 1.7%
     
   
Ducommun, Inc.
     
$ 200,000  
  9.75%, due 7/15/18
  $ 224,000  
     
Gencorp, Inc.
       
  750,000  
  7.125%, due 3/15/21
    806,250  
            1,030,250  
Automotive 3.6%
       
     
Accuride Corp.
       
  676,000  
  9.50%, due 8/1/18
    674,309  
     
Affinia Group, Inc.
       
  500,000  
  7.75%, due 5/1/21 (b)
    525,000  
     
Schaeffler Finance BV
       
  20,000  
  6.875%, due 8/15/18 (b)
    21,400  
  480,000  
  8.50%, due 2/15/19 (b)
    543,600  
     
Stoneridge, Inc.
       
  125,000  
  9.50%, due 10/15/17 (b)
    135,938  
     
UCI International, Inc.
       
  350,000  
  8.625%, due 2/15/19
    355,250  
            2,255,497  
Building Materials 3.6%
       
     
Associated Asphalt Partners LLC
       
  600,000  
  8.50%, due 2/15/18 (b)
    619,500  
     
Building Materials Holding Corp.
       
  400,000  
  9.00%, due 9/15/18 (b)
    423,000  
     
U.S. Concrete, Inc.
       
  625,000  
  8.50%, due 12/1/18 (b)
    639,063  
     
USG Corp.
       
  500,000  
  5.875%, due 11/1/21 (b)
    518,125  
            2,199,688  
Chemicals 10.3%
       
     
Cornerstone Chemical Co.
       
  600,000  
  9.375%, due 3/15/18 (b)
    635,999  
     
Ferro Corp.
       
  300,000  
  7.875%, due 8/15/18
    319,500  
     
Hexion U.S. Finance Corp.
       
  650,000  
  6.625%, due 4/15/20
    665,437  
     
Ineos Finance PLC
       
  50,000  
  7.50%, due 5/1/20 (b)
    55,000  
     
Kraton Polymers LLC
       
  620,000  
  6.75%, due 3/1/19
    654,100  
     
LSB Industries, Inc.
       
  200,000  
  7.75%, due 8/1/19 (b)
    210,000  
     
Momentive Performance
       
     
  Materials, Inc.
       
  165,000  
  8.875%, due 10/15/20
    174,488  
     
Nexeo Solutions LLC
       
  550,000  
  8.375%, due 3/1/18
    552,750  
     
Nova Chemicals Corp.
       
  350,000  
  5.25%, due 8/1/23 (b)
    361,593  
     
Olin Corp.
       
  500,000  
  8.875%, due 8/15/19
    549,375  
     
Omnova Solutions, Inc.
       
  265,000  
  7.875%, due 11/1/18
    286,200  
     
Perstorp Holding AB
       
  495,000  
  8.75%, due 5/15/17 (b)
    532,125  
     
Rentech Nitrogen Partners L.P.
       
  500,000  
  6.50%, due 4/15/21 (b)
    491,250  
     
TPC Group, Inc.
       
  225,000  
  8.75%, due 12/15/20 (b)
    238,781  
     
Trinseo Materials
       
     
  Operating S.C.A.
       
  250,000  
  8.75%, due 2/1/19 (b)
    256,250  
     
Tronox Finance LLC
       
  350,000  
  6.375%, due 8/15/20
    352,188  
            6,335,036  
Construction Machinery 1.6%
       
     
H & E Equipment Services, Inc.
       
  440,000  
  7.00%, due 9/1/22
    482,900  
     
Manitowoc Company, Inc.
       
  500,000  
  5.875%, due 10/15/22
    507,500  
            990,400  
 

The accompanying notes are an integral part of these financial statements.
 

 

 


 
7

 
PIA High Yield Fund
Schedule of Investments – November 30, 2013 (continued)

 
Principal Amount
     
Value
 
Consumer Cyclical Services 3.3%
     
   
APX Group, Inc.
     
$ 175,000  
  6.375%, due 12/1/19
  $ 177,625  
  310,000  
  8.75%, due 12/1/20
    320,075  
     
Garda World Security Corp.
       
  140,000  
  7.25%, due 11/15/21 (b)
    142,800  
     
GEO Group, Inc.
       
  250,000  
  5.875%, due 1/15/22 (b)
    250,938  
     
Live Nation Entertainment, Inc.
       
  600,000  
  7.00%, due 9/1/20 (b)
    651,000  
     
Reliance Intermediate Holdings
       
  475,000  
  9.50%, due 12/15/19 (b)
    522,500  
            2,064,938  
Consumer Products 1.7%
       
     
Acco Brands Corp.
       
  450,000  
  6.75%, due 4/30/20
    450,563  
     
Serta Simmons Holdings LLC
       
  220,000  
  8.125%, due 10/1/20 (b)
    239,250  
     
Visant Corp.
       
  350,000  
  10.00%, due 10/1/17
    329,000  
            1,018,813  
Distributors 1.5%
       
     
Amerigas Partners Financial Corp.
       
  200,000  
  6.25%, due 8/20/19
    217,000  
     
Ferrellgas Partners LP
       
  200,000  
  8.625%, due 6/15/20
    210,500  
  500,000  
  6.75%, due 1/15/22
    511,250  
            938,750  
Diversified Manufacturing 2.5%
       
     
Constellation Enterprises LLC
       
  375,000  
  10.625%, due 2/1/16 (b)
    331,875  
     
Dynacast International LLC
       
  500,000  
  9.25%, due 7/15/19
    552,500  
     
Mcron Finance Sub LLC
       
  435,000  
  8.375%, due 5/15/19 (b)
    485,025  
     
Wesco Distribution, Inc.
       
  200,000  
  5.375%, due 12/15/21 (b)
    202,000  
            1,571,400  
Electric 1.1%
       
     
NRG Energy, Inc.
       
  695,000  
  6.625%, due 3/15/23
    715,850  
         
Environmental 2.1%
       
     
Casella Waste Systems, Inc.
       
  800,000  
  7.75%, due 2/15/19
    812,000  
     
EnergySolutions, Inc.
       
  150,000  
  10.75%, due 8/15/18
    161,625  
     
Heckmann Corp.
       
  300,000  
  9.875%, due 4/15/18
    300,750  
            1,274,375  
Finance 1.7%
       
     
National Financial Partners Corp.
       
  360,000  
  9.00%, due 7/15/21 (b)
    378,900  
     
National Money Mart Co.
       
  650,000  
  10.375%, due 12/15/16
    676,000  
            1,054,900  
Food and Beverage 3.9%
       
     
Aramark Corp.
       
  500,000  
  5.75%, due 3/15/20 (b)
    523,750  
     
Bumble Bee Acquisition Corp.
       
  768,000  
  9.00%, due 12/15/17 (b)
    842,880  
     
Carolina Beverage Group LLC
       
  370,000  
  10.625%, due 8/1/18 (b)
    391,275  
     
Simmons Foods Inc.
       
  600,000  
  10.50%, due 11/1/17 (b)
    633,000  
            2,390,905  
Gaming 1.7%
       
     
MGM Resorts International
       
  500,000  
  6.625%, due 12/15/21
    526,875  
     
Scientific Games Corp.
       
  135,000  
  8.125%, due 9/15/18
    145,294  
     
Scientific Games
       
     
  International, Inc.
       
  370,000  
  6.25%, due 9/1/20
    382,256  
            1,054,425  
 
The accompanying notes are an integral part of these financial statements.
 
 
8

 
PIA High Yield Fund
Schedule of Investments – November 30, 2013 (continued)

 
Principal Amount
     
Value
 
Healthcare 1.6%
     
   
Examworks Group, Inc.
     
$ 575,000  
  9.00%, due 7/15/19
  $ 629,625  
     
Physio-Control
       
     
  International Corp.
       
  333,000  
  9.875%, due 1/15/19 (b)
    374,625  
            1,004,250  
Industrial – Other 7.9%
       
     
American Tire Distributors, Inc.
       
  400,000  
  9.75%, due 6/1/17
    427,000  
     
Brand Energy &
       
     
  Infrastructure Services, Inc.
       
  500,000  
  8.50%, due 12/1/21 (b)
    511,250  
     
Cleaver-Brooks, Inc.
       
  275,000  
  8.75%, due 12/15/19 (b)
    301,813  
     
Dycom Investments, Inc.
       
  520,000  
  7.125%, due 1/15/21
    555,100  
     
Interline Brands, Inc.
       
  375,000  
  10.00%, due 11/15/18
    411,563  
     
RSC Equipment Rental, Inc.
       
  610,000  
  8.25%, due 2/1/21
    696,925  
     
Safway Group Holding
       
  750,000  
  7.00%, due 5/15/18 (b)
    789,375  
     
SPL Logistics Escrow LLC
       
  450,000  
  8.875%, due 8/1/20 (b)
    480,375  
     
Stonemor Partners L.P.
       
  300,000  
  7.875%, due 6/1/21 (b)
    313,500  
     
Zachry Holdings, Inc.
       
  375,000  
  7.50%, due 2/1/20 (b)
    392,813  
            4,879,714  
Lodging 0.0%
       
     
RHP Hotel Property
       
  10,000  
  5.00%, due 4/15/21
    9,850  
         
Machinery 1.1%
       
     
Liberty Tire Recycling
       
     
  Holdco, LLC
       
  700,000  
  11.00%, due 10/1/16 (b)
    705,250  
         
Media Non-Cable 2.6%
       
     
Outerwall, Inc.
       
  600,000  
  6.00%, due 3/15/19
    601,500  
     
RR Donnelley & Sons Co.
       
  50,000  
  8.25%, due 3/15/19
    57,625  
     
Southern Graphics, Inc.
       
  600,000  
  8.375%, due 10/15/20 (b)
    621,000  
     
Valassis Communications, Inc.
       
  350,000  
  6.625%, due 2/1/21
    350,875  
            1,631,000  
Metals and Mining 5.5%
       
     
American Gilsonite Co.
       
  850,000  
  11.50%, due 9/1/17 (b)
    847,875  
     
American Rock Salt
       
     
  Company LLC
       
  300,000  
  8.25%, due 5/1/18 (b)
    295,125  
     
Castle (AM) & Co.
       
  250,000  
  12.75%, due 12/15/16
    281,250  
     
Graftech International Ltd.
       
  640,000  
  6.375%, due 11/15/20
    651,200  
     
Rain CII Carbon LLC
       
  450,000  
  8.00%, due 12/1/18 (b)
    468,000  
     
Suncoke Energy, Inc.
       
  50,000  
  7.625%, due 8/1/19
    54,125  
  300,000  
  7.375%, due 2/1/20 (b)
    315,000  
     
TMS International Corp.
       
  430,000  
  7.625%, due 10/15/21 (b)
    456,875  
            3,369,450  
Oil Field Services 3.9%
       
     
Calfrac Holdings LP
       
  300,000  
  7.50%, due 12/1/20 (b)
    305,250  
     
CHC Helicopter SA
       
  500,000  
  9.25%, due 10/15/20
    540,000  
     
Drill Rig Holdings, Inc.
       
  405,000  
  6.50%, due 10/1/17 (b)
    440,438  
     
Petroleum Geo-Services
       
  200,000  
  7.375%, due 12/15/18 (b)
    215,000  
 
The accompanying notes are an integral part of these financial statements.
 

 

 


 
9

 
PIA High Yield Fund
Schedule of Investments – November 30, 2013 (continued)

 
Principal Amount
     
Value
 
Oil Field Services 3.9% (continued)
     
   
Platinum Energy Solutions, Inc.
     
$ 79,433  
  12.00%, due 10/1/20 (b)(c)(d)(e)
  $ 70,695  
     
Welltec A/S
       
  750,000  
  8.00%, due 2/1/19 (b)
    806,250  
            2,377,633  
Packaging 8.4%
       
     
AEP Industries, Inc.
       
  606,000  
  8.25%, due 4/15/19
    654,479  
     
Boe Intermediate Holding Corp.
       
  627,300  
  9.00%, due 11/1/17 (b)
    649,255  
     
Boe Merger Corp.
       
  165,000  
  9.50%, due 11/1/17 (b)
    175,725  
     
Cons Container Co.
       
  470,000  
  10.125%, due 7/15/20 (b)
    506,425  
     
CROWN Americas LLC
       
  100,000  
  4.50%, due 1/15/23
    93,250  
     
Dispensing Dynamics
       
     
  International, Inc.
       
  500,000  
  12.50%, due 1/1/18 (b)
    530,000  
     
Exopack Holdings
       
  950,000  
  7.875%, due 11/1/19 (b)
    959,499  
     
Mustang Merger Corp.
       
  410,000  
  8.50%, due 8/15/21 (b)
    432,550  
     
Pactiv LLC
       
  50,000  
  8.125%, due 6/15/17
    53,750  
     
Pretium Packaging LLC
       
  175,000  
  11.50%, due 4/1/16
    187,688  
     
Reynolds Group Issuer LLC
       
  110,000  
  5.75%, due 10/15/20
    113,300  
     
Sealed Air Corp.
       
  470,000  
  6.50%, due 12/1/20 (b)
    512,300  
     
Tekni-Plex, Inc.
       
  289,000  
  9.75%, due 6/1/19 (b)
    330,905  
            5,199,126  
Paper 5.4%
       
     
Cascades, Inc.
       
  205,000  
  7.875%, due 1/15/20
    220,888  
     
Clearwater Paper Corp.
       
  430,000  
  4.50%, due 2/1/23
    390,225  
     
Mercer International, Inc.
       
  900,000  
  9.50%, due 12/1/17
    990,000  
     
Neenah Paper, Inc.
       
  500,000  
  5.25%, due 5/15/21 (b)
    488,750  
     
P.H. Glatfelter Co.
       
  400,000  
  5.375%, due 10/15/20
    406,000  
     
Verso Paper Holdings LLC
       
  325,000  
  11.75%, due 1/15/19
    340,438  
     
Xerium Technologies, Inc.
       
  450,000  
  8.875%, due 6/15/18
    474,750  
            3,311,051  
Pharmaceuticals 1.3%
       
     
Capsugel Holdings US, Inc.
       
  500,000  
  7.00%, due 5/15/19 (b)
    509,688  
     
Par Pharmaceutical
       
     
  Companies Inc.
       
  300,000  
  7.375%, due 10/15/20
    316,500  
            826,188  
Pipelines 0.7%
       
     
Atlas Pipeline Partners LP
       
  420,000  
  5.875%, due 8/1/23 (b)
    409,500  
     
Summit Midstream
       
     
  Holdings, LLC
       
  10,000  
  7.50%, due 7/1/21 (b)
    10,500  
            420,000  
Retailers 2.5%
       
     
Party City Holdings, Inc.
       
  550,000  
  8.875%, due 8/1/20
    613,250  
     
Petco Animal Supplies, Inc.
       
  275,000  
  8.50%, due 10/15/17 (b)
    281,190  
  250,000  
  9.25%, due 12/1/18 (b)
    269,375  
     
Rent-A-Center, Inc.
       
  350,000  
  6.625%, due 11/15/20
    371,875  
            1,535,690  
 
The accompanying notes are an integral part of these financial statements.

 
10

 
PIA High Yield Fund
Schedule of Investments – November 30, 2013 (continued)

Principal Amount/
         
Shares
     
Value
 
Technology 6.2%
     
   
ACI Worldwide, Inc.
     
$ 20,000  
  6.375%, due 8/15/20 (b)
  $ 20,825  
     
Brightstar Corp.
       
  200,000  
  7.25%, due 8/1/18 (b)
    218,750  
     
First Data Corp.
       
  500,000  
  7.375%, due 6/15/19 (b)
    537,500  
  500,000  
  8.25%, due 1/15/21 (b)
    533,125  
     
Kemet Corp.
       
  370,000  
  10.50%, due 5/1/18
    361,675  
     
Sophia L.P./Sophia Finance, Inc.
       
  550,000  
  9.75%, due 1/15/19 (b)
    609,125  
     
Sungard Data Systems, Inc.
       
  675,000  
  6.625%, due 11/1/19
    707,906  
     
Transunion Holding Co.
       
  750,000  
  9.625%, due 6/15/18
    812,813  
            3,801,719  
Textile 0.9%
       
     
Levi Strauss & Co.
       
  500,000  
  6.875%, due 5/1/22
    548,750  
         
Transportation Services 1.3%
       
     
LBC Tank Terminal Holding
       
  750,000  
  6.875%, due 5/15/23 (b)
    789,375  
         
Wirelines 1.9%
       
     
Frontier Communications Corp.
       
  270,000  
  9.25%, due 7/1/21
    318,600  
  355,000  
  7.125%, due 1/15/23
    367,425  
     
Windstream Corp.
       
  490,000  
  6.375%, due 8/1/23
    470,400  
            1,156,425  
Total Corporate Bonds
       
  (cost $54,857,026)
    56,460,698  
COMMON STOCKS 0.1%
       
  1,110  
Platinum
       
     
  Energy, Inc. (b)(c)(d)(e)
    39,317  
Total Common Stocks
       
  (cost $79,619)
    39,317  
SHORT-TERM INVESTMENTS 7.6%
       
  4,690,147  
Invesco STIT – Prime Portfolio –
       
     
  Institutional Class, 0.06% (a)
    4,690,147  
 
Total Short-Term Investments
           
  (cost $4,690,147)
          4,690,147  
Total Investments
             
  (cost $59,626,792)
    99.2 %     61,190,162  
Other Assets less Liabilities
    0.8 %     466,982  
TOTAL NET ASSETS
    100.0 %   $ 61,657,144  

(a)
Rate shown is the 7-day annualized yield as of November 30, 2013.
(b)
Security purchased within the terms of a private placement memorandum, exempt from registration under Rule 144A of the Securities Act of 1933, as amended, and may be sold only to dealers in the program or other “qualified institutional buyers.”  Pacific Income Advisers, Inc., the Fund’s adviser, has determined that such security is liquid in accordance with the liquidity guidelines approved by the Board of Trustees of Advisors Series Trust.  As of November 30, 2013, the value of these investments was $29,326,005 or 47.6% of total net assets.
(c)
Non-income producing.
(d)
Security is considered illiquid.  As of November 30, 2013, the value of these investments was $110,012 or 0.2% of total net assets.
(e)
Security valued at fair value using methods determined in good faith by or at the direction of the Board of Trustees of Advisors Series Trust.

The accompanying notes are an integral part of these financial statements.


 
11

 
PIA High Yield Fund
Statement of Assets and Liabilities – November 30, 2013

Assets:
     
      Investments in securities, at value (cost $59,626,792)
  $ 61,190,162  
      Receivable for fund shares sold
    42,183  
      Interest receivable
    1,145,861  
      Prepaid expenses
    15,534  
            Total assets
    62,393,740  
         
Liabilities:
       
      Payable to investment adviser
    28,349  
      Payable for fund shares redeemed
    8,971  
      Due to custodian
    203  
      Investments payable
    657,483  
      Administration fees
    6,291  
      Custody fees
    818  
      Transfer agent fees and expenses
    3,551  
      Fund accounting fees
    7,137  
      Audit fees
    17,979  
      Chief Compliance Officer fee
    711  
      Shareholder reporting
    3,169  
      Accrued expenses
    1,934  
            Total liabilities
    736,596  
            Net Assets
  $ 61,657,144  
         
Net Assets Consist of:
       
      Paid-in capital
  $ 59,389,066  
      Undistributed net investment income
    49,834  
      Accumulated net realized gain on investments
    654,874  
      Net unrealized appreciation on investments
    1,563,370  
            Net Assets
  $ 61,657,144  
         
Net Asset Value, Offering Price and Redemption Price Per Share
  $ 10.72  
         
Shares Issued and Outstanding (Unlimited number of shares authorized, par value $0.01)
    5,750,773  

The accompanying notes are an integral part of these financial statements.

 
12

 
PIA High Yield Fund
Statement of Operations – Year Ended November 30, 2013

Investment Income:
     
      Interest
  $ 3,344,901  
            Total investment income
    3,344,901  
         
Expenses:
       
      Investment advisory fees (Note 4)
    301,997  
      Fund accounting fees (Note 4)
    47,944  
      Transfer agent fees and expenses (Note 4)
    39,250  
      Administration fees (Note 4)
    37,247  
      Registration fees
    28,088  
      Audit fees
    17,999  
      Legal fees
    10,212  
      Reports to shareholders
    7,686  
      Trustees’ fees
    5,578  
      Custody fees (Note 4)
    5,409  
      Chief Compliance Officer fee (Note 4)
    4,878  
      Insurance
    2,821  
      Miscellaneous
    4,095  
            Total expenses
    513,204  
      Less: Fee waiver by adviser (Note 4)
    (57,885 )
            Net expenses
    455,319  
                  Net investment income
    2,889,582  
         
Realized and Unrealized Gain on Investments:
       
      Net realized gain on investments
    654,906  
      Net change in unrealized appreciation on investments
    441,034  
            Net gain on investments
    1,095,940  
      Net increase in net assets resulting from operations
  $ 3,985,522  

The accompanying notes are an integral part of these financial statements.

 
13

 
PIA High Yield Fund
Statements of Changes in Net Assets

   
Year
   
Year
 
   
Ended
   
Ended
 
   
November 30,
   
November 30,
 
   
2013
   
2012
 
Increase/(Decrease) in Net Assets From
           
Operations:
           
      Net investment income
  $ 2,889,582     $ 1,864,148  
      Net realized gain on:
               
            Investments
    654,906       347,326  
            Swap contracts
          22,229  
      Net change in unrealized appreciation/(depreciation) on investments:
               
            Investments
    441,034       1,223,698  
            Swap contracts
          (29,353 )
      Net increase in net assets resulting from operations
    3,985,522       3,428,048  
                 
Distributions Paid to Shareholders:
               
      Distributions from net investment income
    (2,908,278 )     (1,881,117 )
      Distributions from net realized gains
    (194,856 )      
      Total distributions paid to shareholders
    (3,103,134 )     (1,881,117 )
                 
Capital Share Transactions:
               
      Proceeds from shares sold
    32,813,029       26,715,767  
      Distributions reinvested
    1,340,004       609,539  
      Payment for shares redeemed
    (13,912,104 )     (3,131,734 )
      Net increase in net assets from capital share transactions
    20,240,929       24,193,572  
      Total increase in net assets
    21,123,317       25,740,503  
                 
Net Assets, Beginning of Year
    40,533,827       14,793,324  
Net Assets, End of Year
  $ 61,657,144     $ 40,533,827  
Includes Undistributed Net Investment Income of
  $ 49,834     $ 68,530  
                 
Transactions in Shares:
               
      Shares sold
    3,075,500       2,586,944  
      Shares issued on reinvestment of distributions
    126,072       58,910  
      Shares redeemed
    (1,307,199 )     (299,137 )
      Net increase in shares outstanding
    1,894,373       2,346,717  

The accompanying notes are an integral part of these financial statements.

 
14

 
PIA High Yield Fund
Financial Highlights

               
December 31,
 
   
Year
   
Year
      2010*  
   
Ended
   
Ended
   
through
 
   
November 30,
   
November 30,
   
November 30,
 
   
2013
   
2012
      2011  
Per Share Operating Performance
                   
(For a fund share outstanding throughout each period)
                   
                     
Net asset value, beginning of period
  $ 10.51     $ 9.80     $ 10.00  
                         
Income From Investment Operations:
                       
Net investment income
    0.65       0.65       0.45  
Net realized and unrealized gain/(loss)
                       
  on investments and swap contracts
    0.27       0.73       (0.21 )
Total from investment operations
    0.92       1.38       0.24  
                         
Less Distributions:
                       
Distributions from net investment income
    (0.66 )     (0.67 )     (0.44 )
Distributions from net realized gains
    (0.05 )            
Total distributions
    (0.71 )     (0.67 )     (0.44 )
                         
Net asset value, end of period
  $ 10.72     $ 10.51     $ 9.80  
                         
Total Return
    9.06 %     14.42 %     2.40 %++
                         
Ratios/Supplemental Data:
                       
Net assets, end of period (in 000’s)
  $ 61,657     $ 40,534     $ 14,793  
Ratio of expenses to average net assets:
                       
      Net of fee waivers and expense reimbursements
    0.98 %     0.98 %     0.98 %+
      Before fee waivers and expense reimbursements
    1.10 %     1.30 %     3.03 %+
Ratio of net investment income to average net assets:
                       
      Net of fee waivers and expense reimbursements
    6.22 %     6.55 %     5.67 %+
      Before fee waivers and expense reimbursements
    6.10 %     6.23 %     3.62 %+
Portfolio turnover rate
    33 %     36 %     33 %++

*
 
Commencement of operations.
+
 
Annualized for periods less than one year.
++
 
Not annualized for periods less than one year.

The accompanying notes are an integral part of these financial statements.

 
15

 
PIA High Yield Fund
Notes to Financial Statements – November 30, 2013

Note 1 – Organization
 
The PIA High Yield Fund (the “Fund”) is a diversified series of Advisors Series Trust (the “Trust”), which is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company.  Currently, the Fund offers the Investor Class.  The primary investment objective of the Fund is to seek a high level of current income.  The Fund commenced operations on December 31, 2010.
 
Note 2 – Significant Accounting Policies
 
The following is a summary of significant accounting policies consistently followed by the Fund in the preparation of its financial statements. These policies are in conformity with accounting principles generally accepted in the United States of America.
 
Security Valuation – All investments in securities are recorded at their estimated fair value, as described in Note 3.
 
Securities Purchased on a When-Issued Basis – Delivery and payment for securities that have been purchased by the Fund on a forward-commitment or when-issued basis can take place up to a month or more after the transaction date.  During this period, such securities are subject to market fluctuations. The Fund is required to hold and maintain until the settlement date, cash or other liquid assets in an amount sufficient to meet the purchase price.  The purchase of securities on a when-issued or forward-commitment basis may increase the volatility of the Fund’s net asset value if the Fund makes such purchases while remaining substantially fully invested.  In connection with the ability to purchase securities on a when-issued basis, the Fund may also enter into dollar rolls in which the Fund sells securities purchased on a forward-commitment basis and simultaneously contract with a counterparty to repurchase similar (same type, coupon, and maturity), but not identical securities on a specified future date.  As an inducement for the Fund to “rollover” its purchase commitments, the Fund receives negotiated amounts in the form of reductions of the purchase price of the commitment.  Dollar rolls are considered a form of leverage.
 
Federal Income Taxes – It is the Fund’s policy to comply with the requirements of Subchapter M of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders.  Therefore, no Federal income or excise tax provision is required.
 
The Fund recognizes the tax benefits of uncertain tax positions only where the position is “more likely than not” to be sustained assuming examination by tax authorities.  Management has analyzed the Fund’s tax positions, and has concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions expected to be taken on returns filed for the open tax years 2011-2012, or expected to be taken in the Fund’s 2013 tax returns.  The Fund identifies its major tax jurisdictions as U.S. Federal and the state of Wisconsin; however the Fund is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next twelve months.
 
Expenses – The Fund is charged for those expenses that are directly attributable to the Fund, such as administration and custodian fees.  Expenses that are not directly attributable to a Fund are typically allocated among the other PIA Funds in proportion to their respective net assets.
 
Securities Transactions and Investment Income – Security transactions are accounted for on the trade date. Realized gains and losses on sales of securities are calculated on a first-in, first-out basis.  Interest income is recorded on an accrual basis.  Discounts and premiums on securities purchased are accreted/amortized over the life of the respective security.
 

 

 

 

 
16

 
PIA High Yield Fund
Notes to Financial Statements – November 30, 2013 (continued)

 
Distributions to Shareholders – Distributions to shareholders are recorded on the ex-dividend date.  The Fund distributes substantially all net investment income, if any, monthly and net realized gains, if any, annually.  The amount and character of income and net realized gains to be distributed are determined in accordance with Federal income tax rules and regulations, which may differ from accounting principles generally accepted in the United States of America.  To the extent that these differences are attributable to permanent book and tax accounting differences, the components of net assets have been adjusted.
 
Reclassification of Capital Accounts – Accounting principles generally accepted in the United States of America require that certain components of net assets relating to permanent differences be reclassified between financial and tax reporting.  These reclassifications have no effect on net assets or net asset value per share.
 
Guarantees and Indemnifications – In the normal course of business, the Fund enters into contracts with service providers that contain general indemnification clauses.  The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims against the Fund that have not yet occurred.  Based on experience, the Fund expects the risk of loss to be remote.
 
Use of Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operation during the reporting period.  Actual results could differ from those estimates.
 
Events Subsequent to the Fiscal Year End – In preparing the financial statements as of November 30, 2013, management considered the impact of subsequent events for the potential recognition or disclosure in these financial statements.
 
Note 3 – Securities Valuation
 
The Fund has adopted authoritative fair value accounting standards which establish an authoritative definition of fair value and set out a hierarchy for measuring fair value.  These standards require additional disclosures about the various inputs and valuation techniques used to develop the measurements of fair value, a discussion in changes in valuation techniques and related inputs during the period and expanded disclosure of valuation levels for major security types.  These inputs are summarized in the three broad levels listed below:
 
 
Level 1 –
Unadjusted quoted prices in active markets for identical assets or liabilities that the Fund has the ability to access.
 
 
Level 2 –
Observable inputs other than quoted prices included in level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data.
 
 
Level 3 –
Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumptions about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available.

 

 

 

 
17

 
PIA High Yield Fund
Notes to Financial Statements – November 30, 2013 (continued)

 
Following is a description of the valuation techniques applied to the Fund’s major categories of assets and liabilities measured at fair value on a recurring basis.  The Fund’s investments are carried at fair value.
 
Corporate Bonds – Corporate bonds, including listed issues, are valued at market on the basis of valuations furnished by an independent pricing service which utilizes both dealer-supplied valuations and formula-based techniques.  The pricing service may consider recently executed transactions in securities of the issuer or comparable issuers, market price quotations (where observable), bond spreads, and fundamental data relating to the issuer.  Most corporate bonds are categorized in level 2 of the fair value hierarchy.
 
Foreign Securities – Foreign economies may differ from the U.S. economy and individual foreign companies may differ from domestic companies in the same industry.
 
Foreign companies or entities are frequently not subject to accounting and financial reporting standards applicable to domestic companies, and there may be less information available about foreign issuers.  Securities of foreign issuers are generally less liquid and more volatile than those of comparable domestic issuers.  There is frequently less government regulation of broker-dealers and issuers than in the United States.  In addition, investments in foreign countries are subject to the possibility of expropriation, confiscatory taxation, political or social instability or diplomatic developments that could adversely affect the value of those investments.
 
Derivative Instruments – Listed derivatives that are actively traded are valued based on quoted prices from the exchange and are categorized in level 1 of the fair value hierarchy.  Credit default swaps are valued daily based upon quotations from market makers and are typically categorized in level 2 of the fair value hierarchy.
 
Investment Companies – Investments in open-end mutual funds are valued at their net asset value per share.  To the extent, these securities are actively traded and valuation adjustments are not applied, they are categorized in level 1 of the fair value hierarchy.
 
Short-Term Securities – Short-term securities which mature in 60 days or less are valued at amortized cost (unless the Board of Trustees determines that this method does not represent fair value).  Short-term securities which mature after 60 days are valued at market.  To the extent the inputs are observable and timely, these securities would be classified in level 2 of the fair value hierarchy.
 
Illiquid Securities – A security may be considered illiquid if it lacks a readily available market.  Securities are generally considered liquid if they can be sold or disposed of in the ordinary course of business within seven days at approximately the price at which the security is valued by the Fund.  Illiquid securities may be valued under methods approved by the Fund’s Board of Trustees as reflecting fair value.  The Fund intends to hold no more than 15% of its net assets in illiquid securities.  As of November 30, 2013, the Fund held illiquid securities with a value of $110,012 or 0.2% of total net assets.
 
Certain restricted securities may be considered illiquid.  Restricted securities are often purchased in private placement transactions, are not registered under the Securities Act of 1933, may have contractual restrictions on resale, and may be valued under methods approved by the Fund’s Board of Trustees as reflecting fair value.  Certain restricted securities eligible for resale to qualified institutional investors, including Rule 144A securities, are not subject to the limitation on the Fund’s investment in illiquid securities if they are determined to be liquid in accordance with procedures adopted by the Fund’s Board of Trustees.  As of November 30, 2013, Pacific Income Advisers, Inc. (“PIA” or the “Adviser”) has determined that all the Rule 144A securities held by the Fund except for the Platinum holdings are considered liquid.
 

 
18

 
PIA High Yield Fund
Notes to Financial Statements – November 30, 2013 (continued)

 
The Board of Trustees has delegated day-to-day valuation issues to a Valuation Committee of the Trust which is comprised of representatives from U.S. Bancorp Fund Services, LLC, the Fund’s administrator.  The function of the Valuation Committee is to value securities where current and reliable market quotations are not readily available or the closing price does not represent fair value by following procedures approved by the Board of Trustees.  These procedures consider many factors, including the type of security, size of holding, trading volume and news events.  All actions taken by the Valuation Committee are subsequently reviewed and ratified by the Board of Trustees.
 
Depending on the relative significance of the valuation inputs, fair valued securities may be classified in either level 2 or level 3 of the fair value hierarchy.
 
The inputs or methodology used for valuing securities are not an indication of the risk associated with investing in those securities.  The following is a summary of the inputs used to value the Fund’s securities as of November 30, 2013:
 
High Yield Fund
     
Level 1
   
Level 2
   
Level 3
   
Total
 
 
Fixed Income
                       
 
  Corporate Bonds
  $     $ 56,390,003     $ 70,695     $ 56,460,698  
 
Total Fixed Income
          56,390,003       70,695       56,460,698  
 
Common Stocks
                39,317       39,317  
 
Short-Term Investments
    4,690,147                   4,690,147  
 
Total Investments
  $ 4,690,147     $ 56,390,003     $ 110,012     $ 61,190,162  
 
Refer to the Fund’s Schedule of Investment for a detailed break-out of securities.  Transfers between levels are recognized at November 30, 2013, the end of the reporting period.  The Fund recognized no transfers to/from level 1 or level 2.
 
The following is a reconciliation of the Fund’s level 3 investments for which significant unobservable inputs were used in determining value.
 
     
Investments in Securities, at value
 
     
Common Stocks
   
Corporate Bonds
 
 
Balance as of November 30, 2012
  $     $  
 
Accrued discounts/premiums
           
 
Realized gain/(loss)
           
 
Change in unrealized appreciation/(depreciation)
           
 
Purchases
           
 
Sales
           
 
Transfers in and/or out of Level 3
    39,317       70,695  
 
Balance as of November 30, 2013
  $ 39,317     $ 70,695  
 
On October 18, 2013, the Fund received a newly issued Platinum bond, due 2020 and common stock in exchange for the previously held Platinum bond, due 2015.  This exchange was the result of a balance sheet restructuring by
 
 
 
19

 
PIA High Yield Fund
Notes to Financial Statements – November 30, 2013 (continued)

 
Platinum Energy Solutions, Inc. Since receipt of the newly issued securities, the Valuation Committee has priced the Platinum bond, due 2020 by a single broker quote and the common stock has been priced based on the residual value assigned to the newly issued common stock at the time of the exchange.  Since the securities’ fair value utilized significant unobservable inputs due to the lack of reliable market data, the securities are categorized as level 3 of the fair value hierarchy.  A significant change in the broker quote would have a direct change on the fair value of the bond.  If the financial condition of the company were to deteriorate further, the value of the common stock would be lower.
 
New Accounting Pronouncement – In January 2013, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) No. 2013-01 Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities . This update gives additional clarification to the FASB ASU No. 2011-11 Disclosures about Offsetting Assets and Liabilities . The amendments in this ASU require an entity to disclose information about offsetting and related arrangements to enable users of its financial statements to understand the effect of those arrangements on its financial position. The ASU is effective for annual reporting periods beginning on or after January 1, 2013, and interim periods within those annual periods. The guidance requires retrospective application for all comparative periods presented. The Fund is currently evaluating the impact ASU 2013-01 will have on the financial statement disclosures.
 
Note 4 – Investment Advisory Fee and Other Transactions with Affiliates
 
The Fund has an investment advisory agreement with PIA pursuant to which the Adviser is responsible for providing investment management services to the Fund.  The Adviser furnished all investment advice, office space and facilities, and provides most of the personnel needed by the Fund.  As compensation for its services, PIA is entitled to a fee, computed daily and payable monthly.  The Fund pays fees calculated at an annual rate of 0.65% based upon the Fund’s average daily net assets.  For the year ended November 30, 2013, the Fund incurred $301,997 in advisory fees.
 
The Fund is responsible for its own operating expenses.  The Adviser has contractually agreed to reduce fees payable to it by the Fund and to pay Fund operating expenses to the extent necessary to limit the Fund’s aggregate annual operating expenses to 0.98% of average daily net assets.  Any such reduction made by the Adviser in its fees or payment of expenses which are the Fund’s obligation are subject to reimbursement by the Fund to the Adviser, if so requested by the Adviser, in subsequent fiscal years if the aggregate amount actually paid by the Fund toward the operating expenses for such fiscal year (taking into account the reimbursement) does not exceed the applicable limitation on Fund’s expenses. The Adviser is permitted to be reimbursed only for fee reductions and expense payments made in the previous three fiscal years.  Any such reimbursement is also contingent upon Board of Trustees review and approval at the time the reimbursement is made. Such reimbursement may not be paid prior to the Fund’s payment of current ordinary operating expenses. For the year ended November 30, 2013, the Adviser reduced its fees in the amount of $57,885.  No amounts were reimbursed to the Adviser.  Cumulative expenses subject to recapture pursuant to the aforementioned conditions amounted to $264,418 at November 30, 2013.  The expense limitation will remain in effect through at least March 29, 2014, and may be terminated only by the Trust’s Board of Trustees.  Cumulative expenses subject to recapture expire as follows:
 
 
Year
 
Amount
   
 
2014
  $ 115,907    
 
2015
    90,626    
 
2016
    57,885    
      $ 264,418    
 

 
20

 
PIA High Yield Fund
Notes to Financial Statements – November 30, 2013 (continued)

 
U.S. Bancorp Fund Services, LLC (the “Administrator”) acts as the Fund’s Administrator under an Administration Agreement.  The Administrator prepares various federal and state regulatory filings, reports and returns for the Fund; prepares reports and materials to be supplied to the Trustees; monitors the activities of the Fund’s custodian, transfer agent and accountants; coordinates the preparation and payment of the Fund’s expenses and reviews the Fund’s expense accruals.  For the year ended November 30, 2013, the Fund incurred $37,247 in administration fees.
 
U.S. Bancorp Fund Services, LLC (“USBFS”) also serves as the fund accountant and transfer agent to the Fund.  For the year ended November 30, 2013, the High Yield Fund incurred $47,944 in fund accounting fees and $29,937 in transfer agent fees (excluding transfer agency out-of-pocket expenses and sub-ta fees).  U.S. Bank N.A., an affiliate of USBFS, serves as the Fund’s custodian.  For the year ended November 30, 2013, the Fund incurred $5,409 in custody fees.
 
For the year ended November 30, 2013, the Fund was allocated $4,878 of the Chief Compliance Officer fee.
 
At November 30, 2013, the Fund had payables due to USBFS for administration, fund accounting, transfer agency (excluding transfer agency out-of-pocket expenses and sub-ta fees) and Chief Compliance Officer fees and to U.S. Bank, N.A. for custody fees in the amount of $6,291, $7,137, $1,223, $711, and $818, respectively.
 
Quasar Distributors, LLC (the “Distributor”) acts as the Fund’s principal underwriter in a continuous public offering of the Fund’s shares.  The Distributor is an affiliate of the Administrator.
 
Certain officers of the Fund are employees of the Administrator.
 
Note 5 – Purchases and Sales of Securities
 
For the year ended November 30, 2013, the cost of purchases and the proceeds from sales of securities (excluding short-term securities and U.S. government obligations) were $32,122,914 and $14,555,278. There were no long-term purchases and sales of U.S. government obligations during the year ended November 30, 2013.
 
Note 6 – Derivative Instruments
The Fund has adopted the financial accounting reporting rules as required by the Derivatives and Hedging Topic of the FASB Accounting Standards Codification.  The Fund is required to include enhanced disclosure that enables investors to understand how and why an entity uses derivatives, how derivatives are accounted for, and how derivative instruments affect an entity’s results of operations and financial position.
 
The Fund is subject to credit risk in the normal course of pursuing its investment objective.  The Fund may enter into credit default swaps to manage its exposure to the market or certain sectors of the market, to reduce its exposure to other risks, such as interest rate risks or as a substitute for taking a position in certain types of bonds.
 
Credit default swaps involve the exchange of a fixed rate premium for protection against the loss in value of an underlying security in the event of a defined credit event, such as a payment default or bankruptcy.  Under a credit default swap one party acts as a guarantor by receiving the fixed periodic payment in exchange for the commitment to purchase the underlying security at par if the defined credit event occurs.  Although contract specific, credit events are generally defined as bankruptcy, failure to pay, restructuring, obligation acceleration, obligation default, or repudiation/moratorium.  Upon the occurrence of a defined credit event, the difference between the value of the reference obligation and the swap’s notional amount is recorded as realized gain or loss on swap contracts in the statement of operations.  The Fund’s maximum risk of loss from counterparty risk, either as the protection seller or as the
 
 
 
21

 
PIA High Yield Fund
Notes to Financial Statements – November 30, 2013 (continued)

 
protection buyer, is the fair value of the contract.  This risk is mitigated by having a master netting arrangement between the Fund and the counterparty and by the posting of collateral by the counterparty to the Fund to cover the Fund’s exposure to the counterparty.
 
During the year ended November 30, 2013, the Fund did not enter into credit default swaps.
 
Note 7 – Federal Income Tax Information
The tax character of distributions paid during the years ended November 30, 2013 and November 30, 2012 was as follows:
     
Nov. 30, 2013
   
Nov. 30, 2012
 
 
Ordinary income
  $ 3,054,085     $ 1,881,117  
 
Long-term capital gains
    49,049        
 
As of November 30, 2013, the components of capital on a tax basis were as follows:
 
High Yield Fund
 
 
Cost of investments (a)
  $ 59,626,792  
 
Gross unrealized appreciation
    1,961,864  
 
Gross unrealized depreciation
    (398,494 )
 
Net unrealized appreciation (a)
    1,563,370  
 
Undistributed ordinary income
    212,489  
 
Undistributed long-term capital gain
    492,219  
 
Total distributable earnings
    704,708  
 
Other accumulated gains/(losses)
     
 
Total accumulated earnings/(losses)
  $ 2,268,078  
 
 
(a)
The difference between book-basis and tax-basis cost and net unrealized appreciation are the same.

Note 8 – Other Tax Information (Unaudited)
 
For the year ended November 30, 2013, none of the dividends paid from net investment income qualifies for the dividend received deduction available to corporate shareholders of the Fund.  For shareholders in the Fund, none of the dividend income distributed for the year ended November 30, 2013 is designated as qualified dividend income under the Jobs and Growth Relief Act of 2003.
 
The percentage of taxable ordinary income distributions that are designated as short-term capital gain distributions under Internal Revenue Section 871(k)(2)(c) for the Fund was 4.77% for the year ended November 30, 2013.
 
On December 27, 2013, the High Yield Fund distributed $0.05902427 per share of net investment income, $0.02674 per share of short-term capital gains and $0.08091 per share of long-term capital gains.
 




 
22

 
PIA Funds
Report of Independent Registered Public Accounting Firm

To the Board of Trustees
Advisors Series Trust and
Shareholders of
PIA High Yield Fund
 
We have audited the accompanying statement of assets and liabilities of the PIA High Yield Fund, a series of Advisors Series Trust (the “Trust”), including the schedule of investments, as of November 30, 2013, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the two years in the period then ended and for the period December 31, 2010 (commencement of operations) through November 30, 2011.  These financial statements and financial highlights are the responsibility of the Trust’s management.  Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.
 
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement.  The Trust is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.  Our audits included 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 Trust’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 financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.  Our procedures included confirmation of securities owned as of November 30, 2013 by correspondence with the custodian and brokers.  We believe that our audits provide a reasonable basis for our opinion.
 
In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the PIA High Yield Fund as of November 30, 2013, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the two years in the period then ended and for the period December 31, 2010 (commencement of operations) through November 30, 2011, in conformity with accounting principles generally accepted in the United States of America.
 
 
TAIT, WELLER & BAKER LLP
Philadelphia, Pennsylvania
January 29, 2014

 

 
23

 
PIA High Yield Fund
Notice to Shareholders – November 30, 2013
(Unaudited)

How to Obtain a Copy of the Fund’s Proxy Voting Policies
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, by calling 1-800-251-1970, or on the Securities and Exchange Commission’s (“SEC”) website at http://www.sec.gov.
 
How to Obtain a Copy of the Fund’s Proxy Voting Records for the 12-Month Period Ended June 30
Information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available without charge, upon request, by calling 1-800-251-1970.  Furthermore, you can obtain the Fund’s proxy voting records on the SEC’s website at http://www.sec.gov.
 
Quarterly Filings on Form N-Q
The Fund files its complete schedules of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The Fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov. The Fund’s Form N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC, and information on the operation of the Public Reference Room may be obtained by calling 1-202-551-8090.  Information included in the Fund’s Form N-Q is also available by calling 1-800-251-1970.
 
Householding
In an effort to decrease costs, the Fund intends to reduce the number of duplicate prospectuses, annual and semi-annual reports, proxy statements and other regulatory documents you receive by sending only one copy of each to those addresses shared by two or more accounts and to shareholders the Transfer Agent reasonably believes are from the same family or household.  Once implemented, if you would like to discontinue householding for your accounts, please call toll-free at 1-800-251-1970 to request individual copies of these documents.  Once the Transfer Agent receives notice to stop householding, the Transfer Agent will begin sending individual copies thirty days after receiving your request.  This policy does not apply to account statements.
 
 
 

 
24

 
PIA High Yield Fund
Information About Trustees and Officers
(Unaudited)

 
This chart provides information about the Trustees and Officers who oversee the Fund.  Officers elected by the Trustees manage the day-to-day operations of the Fund and execute policies formulated by the Trustees.
 
       
Number of
 
     
Principal
Portfolios in
Other
   
Term of Office
Occupation
Fund Complex
Directorships
Name, Address
Position Held
and Length of
During Past
Overseen by
Held During
and Age
with the Trust
Time Served
Five Years
Trustee (2)
Past Five Years
           
Independent Trustees (1)
         
           
Donald E. O’Connor
Trustee
Indefinite term
Retired; former Financial
6
Trustee,
(age 77)
 
since
Consultant and former
 
Advisors Series
615 E. Michigan Street
 
February 1997.
Executive Vice President and
 
Trust (for series
Milwaukee, WI 53202
   
Chief Operating Officer of ICI
 
not affiliated
     
Mutual Insurance Company
 
with the Funds);
     
(until January 1997).
 
Trustee, The
         
Forward Funds
         
(31 portfolios).
           
George J. Rebhan
Trustee
Indefinite term
Retired; formerly President,
6
Trustee,
(age 79)
 
since
Hotchkis and Wiley Funds
 
Advisors Series
615 E. Michigan Street
 
May 2002.
(mutual funds) (1985 to 1993).
 
Trust (for series
Milwaukee, WI 53202
       
not affiliated
         
with the Funds);
         
Independent
         
Trustee from
         
1999 to 2009,
         
E*TRADE
         
Funds.
           
George T. Wofford
Trustee
Indefinite term
Retired; formerly Senior Vice
6
Trustee,
(age 74)
 
since
President, Federal Home Loan
 
Advisors Series
615 E. Michigan Street
 
February 1997.
Bank of San Francisco.
 
Trust (for series
Milwaukee, WI 53202
       
not affiliated
         
with the Funds).
Interested Trustee
         
           
Joe D. Redwine (3)
Interested
Indefinite term
President, CEO, U.S. Bancorp
6
Trustee,
(age 66)
Trustee
since
Fund Services, LLC
 
Advisors Series
615 E. Michigan Street
 
September 2008.
(May 1991 to present).
 
Trust (for series
Milwaukee, WI 53202
       
not affiliated
         
with the Funds).

 

 
25

 
PIA High Yield Fund
Information About Trustees and Officers (continued)
(Unaudited)

 
   
Term of Office
 
Name, Address
Position Held
and Length of
Principal Occupation
and Age
with the Trust
Time Served
During Past Five Years
       
Officers
     
       
Joe D. Redwine
Chairman and
Indefinite term
President, CEO, U.S. Bancorp Fund Services, LLC
(age 66)
Chief Executive
since
(May 1991 to present).
615 E. Michigan Street
Officer
September 2007.
 
Milwaukee, WI 53202
     
       
Douglas G. Hess
President and
Indefinite term
Senior Vice President, Compliance and Administration,
(age 46)
Principal
since
U.S. Bancorp Fund Services, LLC
615 E. Michigan Street
Executive
June 2003.
(March 1997 to present).
Milwaukee, WI 53202
Officer
   
       
Cheryl L. King
Treasurer and
Indefinite term
Vice President, Compliance and Administration,
(age 52)
Principal
since
U.S. Bancorp Fund Services, LLC
615 E. Michigan Street
Financial
December 2007.
(October 1998 to present).
Milwaukee, WI 53202
Officer
   
       
Kevin J. Hayden
Assistant
Indefinite term
Assistant Vice President, Compliance and Administration,
(age 42)
Treasurer
since
U.S. Bancorp Fund Services, LLC
615 E. Michigan Street
 
September 2013.
(June 2005 to present).
Milwaukee, WI 53202
     
       
Albert Sosa
Assistant
Indefinite term
Assistant Vice President, Compliance and Administration,
(age 43)
Treasurer
since
U.S. Bancorp Fund Services, LLC
615 E. Michigan Street
 
September 2013.
(June 2004 to present).
Milwaukee, WI 53202
     
       
Michael L. Ceccato
Vice President,
Indefinite term
Senior Vice President, U.S. Bancorp Fund Services, LLC
(age 56)
Chief
since
(February 2008 to present); General Counsel/Controller,
615 E. Michigan Street
Compliance
September 2009.
Steinhafels, Inc. (September 1995 to February 2008).
Milwaukee, WI 53202
Officer and
   
 
AML Officer
   
       
Jeanine M. Bajczyk, Esq.
Secretary
Indefinite term
Senior Vice President and Counsel, U.S. Bancorp
(age 48)
 
since
Fund Services, LLC (May 2006 to present).
615 E. Michigan Street
 
June 2007.
 
Milwaukee, WI 53202
     

(1)
The Trustees of the Trust who are not “interested persons” of the Trust as defined under the 1940 Act (“Independent Trustees”).
(2)
As of November 30, 2013, the Trust is comprised of 40 active portfolios managed by unaffiliated investment advisors.  The term “Fund Complex” applies only to the Fund and the PIA BBB Bond Fund, the PIA High Yield (MACS) Fund, the PIA MBS Bond Fund, the PIA Short-Term Duration Bond Fund and the PIA Short-Term Securities Fund.  The Funds do not hold themselves out as related to any other series within the Trust for investment purposes, nor does it share the same investment adviser with any other series.
(3)
Mr. Redwine is an “interested person” of the Trust as defined by the 1940 Act.  Mr. Redwine is an interested Trustee of the Trust by virtue of the fact that he is an interested person of Quasar Distributors, LLC who acts as principal underwriter to the series of the Trust.
 
The Statement of Additional Information includes additional information about the Fund’s Trustees and Officers and is available, without charge, upon request by calling 1-800-251-1970.
 
 
26

 
PRIVACY NOTICE
 
The Fund collects non-public information about you from the following sources:
 
•  Information we receive about you on applications or other forms;
 
•  Information you give us orally; and/or
 
•  Information about your transactions with us or others.
 
We do not disclose any non-public personal information about our customers or former customers without the customer’s authorization, except as permitted by law or in response to inquiries from governmental authorities. We may share information with affiliated and unaffiliated third parties with whom we have contracts for servicing the Fund.  We will provide unaffiliated third parties with only the information necessary to carry out their assigned responsibilities.  We maintain physical, electronic and procedural safeguards to guard your non-public personal information and require third parties to treat your personal information with the same high degree of confidentiality.
 
In the event that you hold shares of the Fund through a financial intermediary, including, but not limited to, a broker-dealer, bank, or trust company, the privacy policy of your financial intermediary would govern how your non-public personal information would be shared by those entities with unaffiliated third parties.
 

 
 

 

Adviser
Pacific Income Advisers, Inc.
1299 Ocean Avenue, Suite 210
Santa Monica, CA  90401


Distributor
Quasar Distributors, LLC
615 East Michigan Street
Milwaukee, WI  53202


Transfer Agent
U.S. Bancorp Fund Services, LLC
615 East Michigan Street
Milwaukee, WI  53202
(800) 251-1970


Custodian
U.S. Bank N.A.
1555 North River Center Drive, Suite 302
Milwaukee, WI  53212


Independent Registered Public Accounting Firm
Tait, Weller & Baker LLP
1818 Market Street, Suite 2400
Philadelphia, PA  19103


Legal Counsel
Paul Hastings LLP
75 East 55th Street
New York, NY  10022


 

Past performance results shown in this report should not be considered a representation of future performance.  Share price and returns will fluctuate so that shares, when redeemed, may be worth more or less than their original cost.  Statements and other information herein are dated and are subject to change.

 

 
 

 

 
PIA FUNDS LOGO
 
 
 
PIA Funds

– PIA BBB Bond Fund
Managed Account Completion Shares (MACS)

– PIA MBS Bond Fund
Managed Account Completion Shares (MACS)

 

 

 

 

 
Annual Report
 
November 30, 2013
 

 

 

 

 
 

 
PIA Funds

Dear Shareholder:
 
We are pleased to provide you with this annual report for the twelve month period ended November 30, 2013 regarding the following series of the PIA Mutual Funds for which Pacific Income Advisers, Inc. (PIA) is the adviser: the PIA BBB Bond Fund and the PIA MBS Bond Fund.
 
During the twelve months ended November 30, 2013, the total returns, including the reinvestment of dividends and capital gains, were as follows:
 
PIA BBB Bond Fund
-2.49%
PIA MBS Bond Fund
-0.74%
PIA BBB Bond Fund
The return of the PIA BBB Bond Fund for the twelve month period ended November 30, 2013 was -2.49%. This was lower than the -1.86% return of the Fund’s index, the Barclays Capital U.S. Credit Baa Bond Index (“Baa Bond Index). The Fund has a strategy of using a broad diversification of BBB rated issuers, industry sectors and range of maturities. The bonds held in the Fund represent over 150 different issuers. The Baa Bond Index has over 500 issuers. The volatility of select issues, issuers and sectors caused the variance in the Fund’s return vs. the benchmarks.
 
PIA MBS Bond Fund
The return of the PIA MBS Bond Fund for the twelve month period ended November 30, 2013 of -0.74% was higher than the Barclays Capital U.S. MBS Fixed Rate Index return of -0.84%. The Fund has a broad diversification of coupons and mortgage sectors. A shorter maturity structure during a period of declining interest rates as well as the use of mortgage dollar rolls resulted in the Fund outperforming the benchmark.
 
Bond Market in Review
The Gross Domestic Product’s (GDP) quarter over quarter rate of growth was +1.1% for the first quarter of 2013, increasing to +3.6% during the third quarter of 2013. This recent quarter for GDP compares favorably for a year over year GDP of 2.0% for all of 2012. The housing sector is showing signs of stability and unemployment levels declined to 7.3% from 8.0% a year ago. The Federal Reserve maintained its easier monetary policy by keeping the Federal Funds Rate close to zero. Inflation, as measured by the Consumer Price Index, declined to 1.0% year over year as of October 2013, down from a 2.2% pace year over year at October 2012.
 
Yields on 5-year Treasury notes and 30-year Treasury bonds rose by 75 and 100 basis points (bp), respectively, from November 30, 2012 to November 30, 2013. Yields on 2-year treasuries rose only 4 bp. The improving economy, stabilization of European sovereign risk, and purchases of treasuries and mortgage-backed securities by the Federal Reserve helped the bond market.
 
Spreads on BBB rated bonds over Treasuries declined during the period from 188 bp to 175 bp. Option adjusted spreads on agency mortgage-backed securities fell from 61 bp to 42 bp as the average life increased from 4.5 years to 7.7 years.
 
We believe that the PIA BBB Bond Fund and the PIA MBS Bond Fund provide our clients with a means of efficiently investing in a broadly diversified portfolio of BBB rated bonds and agency mortgage-backed bonds, respectively.
 
Please take a moment to review the Funds’ statements of assets and liabilities and the results of operations for the twelve month period ended November 30, 2013. We look forward to reporting to you again with the semi-annual report dated May 31, 2014.

 
LLOYD MCADAMS SIGNATURE

Lloyd McAdams
Chairman of the Board
Pacific Income Advisers, Inc.
 

 

 

 

 
1

 
PIA Funds

Past performance is not a guarantee of future results.
 
Opinions expressed above are those of the adviser and are subject to change, are not guaranteed and should not be considered recommendations to buy or sell any security and should not be considered investment advice.
 
Must be preceded or accompanied by a prospectus.
 
Mutual fund investing involves risk. Principal loss is possible. Investments in debt securities typically decrease in value when interest rates rise. This risk is usually greater for longer-term debt securities. Investments in Asset-Backed and Mortgage-Backed Securities include additional risks that investors should be aware of such as credit risk, prepayment risk, possible illiquidity and default, as well as increased susceptibility to adverse economic developments.
 
Investment by the PIA BBB Bond Fund in lower-rated and non-rated securities presents a greater risk of loss to principal and interest than higher-rated securities.  The Fund may invest in foreign securities which involve greater volatility and political, economic and currency risks and differences in accounting methods.  These risks are greater for emerging markets.
 
The Funds may also use options, futures contracts, and swaps, which have the risks of unlimited losses of the underlying holdings due to unanticipated market movements and failure to correctly predict the direction of securities prices, interest rates and currency rates.  Derivatives involve risks different from, and in certain cases, greater than the risks presented by more traditional investments.  These risks are fully disclosed in the Prospectus.
 
Bond ratings provide the probability of an issuer defaulting based on the analysis of the issuer's financial condition and profit potential. Bond rating services are provided by Standard & Poor's, Moody's Investors Service, and Fitch Investors Service. Bond ratings start at AAA (denoting the highest investment quality) and usually end at D (meaning payment is in default).
 
Diversification does not assure a profit or protect against risk in a declining market.
 
The Barclays Capital U.S. Credit Baa Bond Index is an unmanaged index consisting of bonds rated Baa. The issues must be publicly traded and meet certain maturity and issue size requirements. Bonds are represented by the Industrial, Utility, Finance and non-corporate sectors. Non-corporate sectors include sovereign, supranational, foreign agency and foreign local government issuers.  The Barclays Capital U.S. MBS Fixed Rate Index (the “MBS Index”) is an unmanaged index that covers the mortgage-backed pass-through securities of Ginnie Mae (GNMA), Fannie Mae (FNMA) and Freddie Mac (FHLMC). The MBS Index is formed by grouping the universe of over 600,000 individual fixed rate MBS pools into approximately 3,500 generic aggregates. Each aggregate is a proxy for the outstanding pools for a given agency, program, issue year and coupon. The index maturity and liquidity criteria are then applied to these aggregates to determine which qualify for inclusion in the index. About 600 of these generic aggregates meet the criteria.  You cannot invest directly in an index.
 
Gross Domestic Product is the amount of goods and services produced in a year, in a country.
 
Consumer Price Index measures the weighted average of prices of a basket of consumer goods and services, such as transportation, food and medical care.
 
Basis point equals 1/100th of 1%.
 
Please refer to the Schedule of Investments in the report for complete holdings information.  Fund holdings and sector allocations are subject to change at any time and are not recommendations to buy or sell any security. Investment performance reflects fee waivers in effect. In the absence of such waivers, total return would be reduced.
 
Quasar Distributors, LLC, Distributor




 
2

 
PIA Funds

 
PIA BBB BOND FUND
Comparison of the change in value of a $10,000 investment in the
PIA BBB Bond Fund vs the Barclays Capital U.S. Credit Baa Bond Index
 
 
 
Average Annual Total Return*
1 Year
5 Year
10 Year
PIA BBB Bond Fund
-2.49%
11.38%
5.71%
Barclays Capital U.S. Credit Baa Bond Index
-1.86%
12.07%
6.19%
 
Performance data quoted represents past performance; past performance does not guarantee future results.  The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost.  Current performance of the Fund may be lower or higher than the performance quoted.  Performance data current to the most recent month end may be obtained by calling 1-800-251-1970.
 
This chart illustrates the performance of a hypothetical $10,000 investment made in the Fund ten years ago.  Returns reflect the reinvestment of dividends and capital gain distributions.  Fee waivers are in effect.  In the absence of fee waivers,  returns would be reduced.  The performance data and graph do not reflect the deduction of taxes that a shareholder may pay on dividends, capital gain distributions, or redemption of Fund shares.  This chart does not imply any future performance.
 
The Fund was invested primarily in U.S. Treasury securities on the inception date in September 2003 following a $200,000 investment by the Adviser (Pacific Income Advisers - PIA).  The Fund remained invested primarily in U.S. Treasury securities until mid January 2004 when PIA clients commenced investing in the Fund.  At that time, the Fund began investing in BBB rated bonds. U.S. Treasury securities held in the Fund provided a lower return than BBB rated bonds for the period from inception to January 13, 2004 (1.62% for the Fund compared to 3.95% for the Barclays Capital U.S. Credit Baa Bond Index) as Baa spreads over Treasuries narrowed from 166 basis points to 136 basis points.
 

 
 
3

 
PIA Funds

The Barclays Capital U.S. Credit Baa Bond Index includes both corporate and non-corporate sectors.  The corporate sectors are Industrial, Utility and Finance, which include both U.S. and non-U.S. corporations.  The non-corporate sectors are Sovereign, Supranational, Foreign Agency and Foreign Local Government.  The securities must be rated Baa/BBB by at least two of the following ratings agencies:  Moody's, S&P, and Fitch.  If only two of the three agencies rate the security, the lower rating is used to determine index eligibility.  If only one of the three agencies rates a security, the rating must be investment grade.  The securities must be fixed rate, although they can carry a coupon that steps up or changes according to a predetermined schedule, and they must be dollar-denominated and non-convertible.
 
Indices do not incur expenses and are not available for investment.
 
*  Average Annual Total Return represents the average change in account value over the periods indicated.
 




 
4

 
PIA Funds

 
PIA MBS BOND FUND
Comparison of the change in value of a $10,000 investment in the
PIA MBS Bond Fund vs the Barclays Capital U.S. MBS Fixed Rate Index
 
 
 
Average Annual Total Return*
1 Year
5 Year
Since Inception
PIA MBS Bond Fund
-0.74%
4.03%
4.89%
Barclays Capital U.S. MBS Fixed Rate Index
-0.84%
4.16%
5.00%
 
Performance data quoted represents past performance; past performance does not guarantee future results.  The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost.  Current performance of the Fund may be lower or higher than the performance quoted.  Performance data current to the most recent month end may be obtained by calling 1-800-251-1970.
 
This chart illustrates the performance of a hypothetical $10,000 investment made in the Fund on its inception date, February 28, 2006.  Returns reflect the reinvestment of dividends and capital gain distributions.  Fee waivers are in effect.  In the absence of fee waivers,  returns would be reduced.  The performance data and graph do not reflect the deduction of taxes that a shareholder may pay on dividends, capital gain distributions, or redemption of Fund shares.  This chart does not imply any future performance.
 
The Barclays Capital U.S. MBS Fixed Rate Index is an unmanaged index that covers the mortgage-backed pass-through securities of Ginnie Mae (GNMA), Fannie Mae (FNMA) and Freddie Mac (FHLMC).  The index is formed by grouping the universe of over 600,000 individual fixed rate MBS pools into approximately 3,500 generic aggregates.  Each aggregate is a proxy for the outstanding pools for a given agency, program, issue year and coupon.  The index maturity and liquidity criteria are then applied to these aggregates to determine which qualify for inclusion in the index.  About 600 of these generic aggregates meet the criteria.
 
Indices do not incur expenses and are not available for investment.
 
*  Average Annual Total Return represents the average change in account value over the periods indicated.
 

 

 

 

 
5

 
PIA Funds
Expense Example – November 30, 2013
(Unaudited)

As a shareholder of a mutual fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, redemption fees, and exchange fees, and (2) ongoing costs, including management fees, distribution and/or service fees, and other fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the PIA Funds and to compare these costs with the ongoing costs of investing in other mutual funds. The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (6/1/13 – 11/30/13).
 
Actual Expenses
The first line of the tables below provides information about actual account values and actual expenses, with actual net expenses being limited to 0.00% per the advisory agreements for the PIA BBB Bond Fund and the PIA MBS Bond Fund.  Although the Funds charge no sales loads or transaction fees, you will be assessed fees for outgoing wire transfers, returned checks, and stop payment orders at prevailing rates charged by U.S. Bancorp Fund Services, LLC, the Funds’ transfer agent.  The Example below includes, but is not limited to, fund accounting, custody and transfer agent fees.  You may use the information in the first line, together with the amount you invested, to estimate the expenses that you paid over the period.  Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses Paid During Period'' to estimate the expenses you paid on your account during this period.
 
Hypothetical Example for Comparison Purposes
The second line of the tables below provides information about hypothetical account values and hypothetical expenses based on the Funds’ actual expense ratios and an assumed rate of return of 5% per year before expenses, which is different from the Funds’ actual returns.  The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period.  You may use this information to compare the ongoing costs of investing in the Funds and other funds.  To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.  Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads), redemption fees, or exchange fees.  Therefore, the second line of the tables is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
 
 
Beginning Account
Ending Account
Expenses Paid During
 
Value 6/1/13
Value 11/30/13
Period 6/1/13 – 11/30/13*
PIA BBB Bond Fund
     
    Actual
$1,000.00
$   983.80
$0.00
    Hypothetical (5% return before expenses)
$1,000.00
$1,025.07
$0.00
PIA MBS Bond Fund
     
    Actual
$1,000.00
$1,003.30
$0.00
    Hypothetical (5% return before expenses)
$1,000.00
$1,025.07
$0.00

*
Expenses are equal to a Fund’s annualized expense ratio, multiplied by the average account value over the period, multiplied by 183 (days in most recent fiscal half-year) / 365 days to reflect the one-half year expense.  The annualized expense ratio of the PIA BBB Bond Fund and the PIA MBS Bond Fund is 0.00%.




 
6

 
PIA Funds
PIA BBB BOND FUND
Allocation of Portfolio Assets – November 30, 2013
(Unaudited)

Investments by Sector
As a Percentage of Total Investments
 




 
7

 
PIA Funds
PIA MBS BOND FUND
Allocation of Portfolio Assets – November 30, 2013
(Unaudited)


Investments by Issuer
As a Percentage of Total Investments
 




 
8

 
PIA Funds
PIA BBB BOND FUND
Schedule of Investments – November 30, 2013

 
Principal Amount
     
Value
 
CORPORATE BONDS 83.1%
     
       
Agricultural Chemicals 0.3%
     
   
Mosaic Co.
     
$ 785,000  
  3.75%, due 11/15/21
  $ 777,753  
         
Agriculture 0.3%
       
     
Bunge Limited Finance Corp.
       
  550,000  
  8.50%, due 6/15/19
    686,166  
         
Airlines 1.0%
       
     
Continental Airlines, Inc.
       
  593,376  
  5.983%, due 10/19/23
    648,263  
     
Delta Air Lines, Inc.
       
  714,223  
  7.75%, due 6/17/21
    821,356  
     
US Airways
       
  1,056,511  
  5.90%, due 4/1/26
    1,138,391  
            2,608,010  
Auto Parts 1.4%
       
     
Advance Auto Parts, Inc.
       
  1,600,000  
  5.75%, due 5/1/20
    1,754,389  
     
Autozone, Inc.
       
  600,000  
  3.125%, due 7/15/23
    555,411  
     
Johnson Controls, Inc.
       
  1,380,000  
  4.25%, due 3/1/21
    1,431,685  
            3,741,485  
Autos 1.9%
       
     
Ford Motor Co.
       
  1,375,000  
  7.45%, due 7/16/31
    1,682,534  
     
Ford Motor Credit Co. LLC
       
  1,850,000  
  7.00%, due 4/15/15
    2,004,268  
  1,250,000  
  5.875%, due 8/2/21
    1,421,300  
            5,108,102  
Banks 3.1%
       
     
Barclays Bank PLC
       
  700,000  
  5.14%, due 10/14/20
    744,157  
     
Capital One Financial Corp.
       
  1,815,000  
  6.15%, due 9/1/16
    2,038,873  
     
Citigroup, Inc.
       
  1,250,000  
  5.50%, due 2/15/17
    1,388,408  
  1,000,000  
  6.125%, due 8/25/36
    1,056,689  
     
Fifth Third Bancorp
       
  930,000  
  4.50%, due 6/1/18
    1,010,113  
  225,000  
  8.25%, due 3/1/38
    304,943  
     
KeyCorp
       
  900,000  
  5.10%, due 3/24/21
    995,381  
     
UBS AG
       
  750,000  
  5.875%, due 7/15/16
    834,253  
            8,372,817  
Biotech 2.0%
       
     
Amgen, Inc.
       
  2,220,000  
  3.875%, due 11/15/21
    2,276,406  
  1,000,000  
  5.15%, due 11/15/41
    987,268  
     
Biogen Idec, Inc.
       
  1,110,000  
  6.875%, due 3/1/18
    1,322,366  
     
Gilead Sciences, Inc.
       
  750,000  
  5.65%, due 12/1/41
    836,036  
            5,422,076  
Broker 2.7%
       
     
Goldman Sachs Group, Inc.
       
  1,300,000  
  5.625%, due 1/15/17
    1,439,376  
  950,000  
  6.75%, due 10/1/37
    1,056,814  
     
Merrill Lynch & Co., Inc.
       
  1,510,000  
  5.70%, due 5/2/17
    1,684,717  
  1,150,000  
  6.11%, due 1/29/37
    1,227,486  
     
Morgan Stanley
       
  900,000  
  4.875%, due 11/1/22
    926,115  
     
Nomura Holdings, Inc.
       
  700,000  
  6.70%, due 3/4/20
    804,973  
            7,139,481  
Building Materials 0.3%
       
     
Owens Corning Inc.
       
  775,000  
  4.20%, due 12/15/22
    752,520  

The accompanying notes are an integral part of these financial statements.




 
9

 
PIA Funds
PIA BBB BOND FUND
Schedule of Investments – November 30, 2013 (continued)

 
Principal Amount
     
Value
 
Cable/Satellite 0.9%
     
   
Direct TV Holdings
     
$ 1,300,000  
  1.75%, due 1/15/18
  $ 1,280,008  
  935,000  
  5.00%, due 3/1/21
    977,315  
  300,000  
  6.00%, due 8/15/40
    292,681  
            2,550,004  
Chemicals 1.7%
       
     
Dow Chemical Co.
       
  1,075,000  
  4.25%, due 11/15/20
    1,155,135  
  865,000  
  7.375%, due 11/1/29
    1,109,429  
     
Eastman Chemical Co.
       
  900,000  
  2.40%, due 6/1/17
    918,430  
     
PPG Industries, Inc.
       
  750,000  
  6.65%, due 3/15/18
    881,828  
     
RPM International, Inc.
       
  500,000  
  6.125%, due 10/15/19
    570,082  
            4,634,904  
Communications 1.0%
       
     
Telefonica Emisiones SAU
       
  1,935,000  
  5.462%, due 2/16/21
    2,056,655  
  600,000  
  7.045%, due 6/20/36
    655,483  
            2,712,138  
Communications Equipment 0.9%
       
     
Harris Corp.
       
  1,500,000  
  6.15%, due 12/15/40
    1,606,084  
     
L-3 Communications Corp.
       
  775,000  
  4.75%, due 7/15/20
    816,008  
            2,422,092  
Consumer Products 0.3%
       
     
Avon Products, Inc.
       
  700,000  
  5.00%, due 3/15/23
    689,949  
     
Beam, Inc.
       
  181,000  
  5.375%, due 1/15/16
    196,855  
            886,804  
Diversified Manufacturing 0.2%
       
     
Ingersoll-Rand Global
       
     
  Holding Company Ltd.
       
  560,000  
  6.875%, due 8/15/18
    664,576  
         
Electric Utilities 4.5%
       
     
Dominion Resources, Inc.
       
  1,130,000  
  5.15%, due 7/15/15
    1,208,211  
  470,000  
  4.90%, due 8/1/41
    461,790  
     
Duke Energy Corp.
       
  1,270,000  
  6.25%, due 6/15/18
    1,496,492  
     
Exelon Corp.
       
  845,000  
  4.90%, due 6/15/15
    893,554  
  1,015,000  
  5.625%, due 6/15/35
    1,010,958  
     
Indiana Michigan Power
       
  850,000  
  6.05%, due 3/15/37
    939,823  
     
Jersey Central Power & Light
       
  700,000  
  7.35%, due 2/1/19
    842,167  
     
Nevada Power Co.
       
  1,110,000  
  6.50%, due 8/1/18
    1,333,145  
     
NiSource Finance Corp.
       
  900,000  
  6.125%, due 3/1/22
    1,008,531  
  400,000  
  5.25%, due 2/15/43
    383,002  
     
Ohio Power Co.
       
  1,100,000  
  5.375%, due 10/1/21
    1,238,781  
     
Oncor Electric Delivery
       
  595,000  
  7.00%, due 5/1/32
    721,904  
     
Teco Finance, Inc.
       
  550,000  
  5.15%, due 3/15/20
    606,743  
            12,145,101  
Finance 0.3%
       
     
Block Financial Corp.
       
  900,000  
  5.50%, due 11/1/22
    932,671  
         
Finance – Credit Cards 0.6%
       
     
American Express Co.
       
  1,555,000  
  6.80%, due 9/1/66 (a)
    1,658,019  
         
Food 3.0%
       
     
ConAgra Foods, Inc.
       
  1,400,000  
  7.00%, due 10/1/28
    1,687,958  

The accompanying notes are an integral part of these financial statements.




 
10

 
PIA Funds
PIA BBB BOND FUND
Schedule of Investments – November 30, 2013 (continued)

 
Principal Amount
     
Value
 
Food 3.0% (continued)
     
   
Kraft Foods, Inc.
     
$ 1,510,000  
  6.50%, due 8/11/17
  $ 1,783,757  
  500,000  
  6.875%, due 2/1/38
    599,818  
     
Kraft Foods Group, Inc.
       
  1,890,000  
  2.25%, due 6/5/17
    1,940,652  
     
Kellogg Co.
       
  1,200,000  
  3.25%, due 5/21/18
    1,268,891  
     
Kroger Co.
       
  780,000  
  6.15%, due 1/15/20
    903,732  
            8,184,808  
Gas Pipelines 0.5%
       
     
Plains All American
       
     
  Pipeline, L.P.
       
  1,100,000  
  6.50%, due 5/1/18
    1,299,064  
         
Health Care 1.5%
       
     
Cardinal Health, Inc.
       
  1,400,000  
  5.80%, due 10/15/16
    1,577,904  
     
Humana, Inc.
       
  1,255,000  
  7.20%, due 6/15/18
    1,499,486  
     
Laboratory Corporation of
       
     
  America Holdings
       
  1,000,000  
  2.20%, due 8/23/17
    1,008,113  
            4,085,503  
Information Technology 1.3%
       
     
Hewlett Packard Co.
       
  1,750,000  
  2.60%, due 9/15/17
    1,787,231  
  800,000  
  4.65%, due 12/9/21
    823,406  
     
Ingram Micro, Inc.
       
  775,000  
  5.00%, due 8/10/22
    772,468  
            3,383,105  
Insurance 5.5%
       
     
American International
       
     
  Group, Inc.
       
  1,775,000  
  5.05%, due 10/1/15
    1,911,189  
  1,400,000  
  4.875%, due 6/1/22
    1,519,369  
  700,000  
  6.25%, due 3/15/87 (a)
    703,500  
     
Aon Corp.
       
  600,000  
  5.00%, due 9/30/20
    663,144  
     
AXA SA
       
  500,000  
  8.60%, due 12/15/30
    615,067  
     
CIGNA Corp.
       
  315,000  
  6.15%, due 11/15/36
    362,364  
     
Cincinnati Financial Corp.
       
  1,200,000  
  6.92%, due 5/15/28
    1,425,959  
     
CNA Financial Corp.
       
  700,000  
  5.85%, due 12/15/14
    736,777  
     
Fidelity National Financial, Inc.
       
  1,475,000  
  5.50%, due 9/1/22
    1,553,663  
  105,000  
  3.50%, due 4/15/23
    96,545  
     
Hartford Financial
       
     
  Services Group
       
  1,500,000  
  5.125%, due 4/15/22
    1,658,640  
     
Markel Corp.
       
  20,000  
  4.90%, due 7/1/22
    21,197  
     
Metlife, Inc.
       
  855,000  
  6.40%, due 12/15/66 (a)
    880,650  
     
Protective Life Corp.
       
  350,000  
  7.375%, due 10/15/19
    423,953  
     
Prudential Financial, Inc.
       
  1,200,000  
  6.625%, due 12/1/37
    1,459,791  
     
Unum Group
       
  700,000  
  5.625%, due 9/15/20
    780,767  
            14,812,575  
Lodging 0.2%
       
     
Host Hotels & Resorts LP
       
  600,000  
  4.75%, due 3/1/23
    610,274  
         
Machinery 0.5%
       
     
Flowserve Corp.
       
  1,400,000  
  3.50%, due 9/15/22
    1,310,354  
         
Media 5.0%
       
     
CBS Corp.
       
  1,220,000  
  5.75%, due 4/15/20
    1,381,584  

The accompanying notes are an integral part of these financial statements.




 
11

 
PIA Funds
PIA BBB BOND FUND
Schedule of Investments – November 30, 2013 (continued)

 
Principal Amount
     
Value
 
Media 5.0% (continued)
     
   
Discover Communications LLC
     
$ 500,000  
  3.30%, due 5/15/22
  $ 480,465  
     
Expedia, Inc.
       
  800,000  
  5.95%, due 8/15/20
    865,609  
     
Interpublic Group of Companies
       
  930,000  
  6.25%, due 11/15/14
    974,175  
     
News America, Inc.
       
  750,000  
  5.30%, due 12/15/14
    786,611  
  1,610,000  
  6.20%, due 12/15/34
    1,779,963  
     
Omnicom Group, Inc.
       
  400,000  
  3.625%, due 5/1/22
    390,041  
     
Time Warner, Inc.
       
  2,565,000  
  7.625%, due 4/15/31
    3,203,613  
     
Time Warner Cable, Inc.
       
  2,075,000  
  5.85%, due 5/1/17
    2,289,096  
     
Time Warner Entertainment
       
     
  Company, L.P.
       
  810,000  
  8.375%, due 7/15/33
    883,233  
     
Viacom Inc.
       
  610,000  
  4.375%, due 3/15/43
    509,343  
            13,543,733  
Medical Equipment 0.4%
       
     
Agilent Technologies, Inc.
       
  900,000  
  6.50%, due 11/1/17
    1,048,105  
         
Metals 0.6%
       
     
Alcoa, Inc.
       
  810,000  
  5.55%, due 2/1/17
    877,812  
     
Southern Copper Corp.
       
  750,000  
  6.75%, due 4/16/40
    721,013  
            1,598,825  
Metals and Mining 0.5%
       
     
Teck Resources Ltd.
       
  700,000  
  4.75%, due 1/15/22
    708,151  
  800,000  
  5.40%, due 2/1/43
    724,344  
            1,432,495  
Metalworking Machinery 0.5%
       
     
Kennametal, Inc.
       
  1,300,000  
  2.65%, due 11/1/19
    1,285,076  
         
Mining 2.8%
       
     
Barrick Gold Corp.
       
  1,370,000  
  6.95%, due 4/1/19
    1,609,917  
     
Freeport-McMoRan
       
     
  Copper & Gold Inc.
       
  2,550,000  
  3.55%, due 3/1/22
    2,381,935  
     
Newmont Mining Corp.
       
  800,000  
  4.875%, due 3/15/42
    596,683  
     
Vale Overseas Limited
       
  1,360,000  
  6.25%, due 1/23/17
    1,532,025  
  700,000  
  4.375%, due 1/11/22
    679,549  
  700,000  
  6.875%, due 11/21/36
    720,050  
            7,520,159  
Office Equipment 0.4%
       
     
Xerox Corp.
       
  900,000  
  6.75%, due 2/1/17
    1,030,111  
         
Oil and Gas 12.8%
       
     
Anadarko Petroleum Corp.
       
  800,000  
  5.95%, due 9/15/16
    901,547  
  1,000,000  
  6.45%, due 9/15/36
    1,163,118  
     
Cameron International Corp.
       
  900,000  
  6.375%, due 7/15/18
    1,054,812  
     
Canadian Natural Resources
       
  835,000  
  6.00%, due 8/15/16
    941,824  
  725,000  
  6.50%, due 2/15/37
    836,350  
     
Devon Energy Corp.
       
  665,000  
  7.95%, due 4/15/32
    868,608  
     
Encana Corp.
       
  450,000  
  3.90%, due 11/15/21
    452,259  
  750,000  
  6.50%, due 8/15/34
    823,542  
     
Enterprise Products
       
     
  Operating LLC
       
  850,000  
  3.20%, due 2/1/16
    892,302  
  2,100,000  
  4.85%, due 8/15/42
    1,968,019  

The accompanying notes are an integral part of these financial statements.




 
12

 
PIA Funds
PIA BBB BOND FUND
Schedule of Investments – November 30, 2013 (continued)

 
Principal Amount
     
Value
 
Oil and Gas 12.8% (continued)
     
   
Hess Corp.
     
$ 575,000  
  8.125%, due 2/15/19
  $ 723,298  
  800,000  
  5.60%, due 2/15/41
    841,785  
     
Kinder Morgan Energy Partners
       
  750,000  
  3.95%, due 9/1/22
    741,990  
  1,420,000  
  5.80%, due 3/15/35
    1,462,607  
     
Marathon Oil Corp.
       
  1,200,000  
  6.00%, due 10/1/17
    1,375,279  
     
Marathon Petroleum Corp.
       
  1,206,000  
  3.50%, due 3/1/16
    1,268,329  
     
Pemex Master Trust
       
  1,650,000  
  5.75%, due 3/1/18
    1,835,625  
  1,300,000  
  6.625%, due 6/15/35
    1,339,000  
     
Petro-Canada
       
  900,000  
  6.80%, due 5/15/38
    1,085,597  
     
Petrobras International
       
     
  Finance Co.
       
  2,085,000  
  5.875%, due 3/1/18
    2,266,074  
  2,050,000  
  5.375%, due 1/27/21
    2,066,623  
  390,000  
  6.875%, due 1/20/40
    382,501  
     
Petroleos Mexicanos
       
  750,000  
  5.50%, due 1/21/21
    810,000  
     
Pioneer Natural Resource Co.
       
  1,300,000  
  3.95%, due 7/15/22
    1,317,038  
     
Southwestern Energy Co.
       
  1,500,000  
  4.10%, due 3/15/22
    1,503,490  
     
Suncor Energy, Inc.
       
  500,000  
  6.10%, due 6/1/18
    587,825  
     
Talisman Energy
       
  685,000  
  6.25%, due 2/1/38
    684,332  
     
Transocean, Inc.
       
  820,000  
  6.00%, due 3/15/18
    929,640  
  700,000  
  6.375%, due 12/15/21
    787,834  
  450,000  
  6.80%, due 3/15/38
    492,179  
     
Valero Energy Corp.
       
  255,000  
  6.625%, due 6/15/37
    291,974  
     
Weatherford International Ltd.
       
  800,000  
  4.50%, due 4/15/22
    809,989  
  800,000  
  6.75%, due 9/15/40
    858,454  
            34,363,844  
Paper 1.0%
       
     
International Paper Co.
       
  900,000  
  4.75%, due 2/15/22
    952,726  
  700,000  
  6.00%, due 11/15/41
    757,933  
     
Weyerhaeuser Co.
       
  800,000  
  7.375%, due 3/15/32
    984,473  
            2,695,132  
Pharmaceuticals 1.6%
       
     
Abbvie, Inc.
       
  1,650,000  
  1.75%, due 11/6/17
    1,664,244  
  200,000  
  4.40%, due 11/6/42
    183,546  
     
Perrigo Co. Ltd.
       
  500,000  
  4.00%, due 11/15/23 (b)
    496,099  
     
Watson Pharmaceuticals, Inc.
       
  1,875,000  
  1.875%, due 10/1/17
    1,872,412  
            4,216,301  
Pipelines 2.6%
       
     
El Paso Electric Co.
       
  850,000  
  6.00%, due 5/15/35
    893,523  
     
Enbridge Energy Partners, L.P.
       
  590,000  
  5.20%, due 3/15/20
    638,614  
     
Energen Corp.
       
  750,000  
  4.625%, due 9/1/21
    747,976  
     
Energy Transfer Partners L.P.
       
  700,000  
  5.20%, due 2/1/22
    745,914  
  1,000,000  
  7.60%, due 2/1/24 (b)
    1,211,150  
     
Oneok Partners LP
       
  1,500,000  
  3.375%, due 10/1/22
    1,420,530  
     
Tennessee Gas Pipeline
       
  1,125,000  
  7.50%, due 4/1/17
    1,327,181  
            6,984,888  

The accompanying notes are an integral part of these financial statements.




 
13

 
PIA Funds
PIA BBB BOND FUND
Schedule of Investments – November 30, 2013 (continued)

 
Principal Amount
     
Value
 
Real Estate Investment Trusts 3.4%
     
   
Boston Properties LP
     
$ 1,400,000  
  4.125%, due 5/15/21
  $ 1,453,098  
     
Duke Realty LP
       
  750,000  
  8.25%, due 8/15/19
    938,566  
     
ERP Operating LP
       
  900,000  
  5.75%, due 6/15/17
    1,017,370  
     
Health Care Property Investors, Inc.
       
  850,000  
  6.00%, due 1/30/17
    959,507  
     
Health Care REIT, Inc.
       
  1,050,000  
  5.25%, due 1/15/22
    1,132,893  
     
Healthcare Realty Trust
       
  675,000  
  6.50%, due 1/17/17
    761,099  
     
Hospitality Properties Trust
       
  620,000  
  5.625%, due 3/15/17
    679,356  
     
ProLogis
       
  559,000  
  6.875%, due 3/15/20
    662,948  
     
Ventas Realty LP
       
  1,500,000  
  4.75%, due 6/1/21
    1,592,862  
            9,197,699  
Restaurants 0.3%
       
     
Yum! Brands, Inc.
       
  800,000  
  3.75%, due 11/1/21
    802,339  
         
Retail 1.7%
       
     
CVS Caremark Corp.
       
  2,050,000  
  5.75%, due 6/1/17
    2,346,633  
     
Gap, Inc.
       
  1,000,000  
  5.95%, due 4/12/21
    1,109,968  
     
Macy’s Retail Holdings, Inc.
       
  800,000  
  2.875%, due 2/15/23
    726,898  
  400,000  
  6.70%, due 7/15/34
    448,788  
            4,632,287  
Scientific Instruments 0.3%
       
     
Thermo Fisher Scientific, Inc.
       
  900,000  
  3.60%, due 8/15/21
    897,214  
               
Software 1.0%
       
     
Fiserv, Inc.
       
  700,000  
  3.50%, due 10/1/22
    661,379  
     
Jabil Circuit, Inc.
       
  2,050,000  
  4.70%, due 9/15/22
    1,993,625  
            2,655,004  
Technology 0.3%
       
     
Tech Data Corp.
       
  700,000  
  3.75%, due 9/21/17
    720,912  
         
Telecommunications 2.6%
       
     
American Tower Corp.
       
  1,350,000  
  5.05%, due 9/1/20
    1,431,656  
     
British Telecommunications PLC
       
  980,000  
  9.625%, due 12/15/30 (a)
    1,459,190  
     
Deutsche Telekom
       
     
  International Finance
       
  445,000  
  8.75%, due 6/15/30 (a)
    629,503  
     
Embarq Corp.
       
  600,000  
  7.082%, due 6/1/16
    672,083  
     
France Telecom SA
       
  700,000  
  5.375%, due 1/13/42
    703,804  
     
Grupo Televisa SAB
       
  400,000  
  6.625%, due 3/18/25
    463,965  
     
Telecom Italia Capital
       
  800,000  
  5.25%, due 10/1/15
    841,910  
  710,000  
  7.721%, due 6/4/38
    684,203  
            6,886,314  
Tobacco 1.1%
       
     
Altria Group, Inc.
       
  987,000  
  9.70%, due 11/10/18
    1,316,371  
  147,000  
  9.95%, due 11/10/38
    225,893  
     
Lorillard Tobacco Co.
       
  1,400,000  
  3.75%, due 5/20/23
    1,292,675  
            2,834,939  
Toys and Games 0.3%
       
     
Mattel, Inc.
       
  820,000  
  5.45%, due 11/1/41
    827,307  

The accompanying notes are an integral part of these financial statements.

 
14

 
PIA Funds
PIA BBB BOND FUND
Schedule of Investments – November 30, 2013 (continued)

 
Principal Amount
     
Value
 
Transportation 1.7%
     
   
Burlington Northern Santa Fe
     
$ 1,075,000  
  4.70%, due 10/1/19
  $ 1,201,664  
  1,385,000  
  6.15%, due 5/1/37
    1,574,716  
     
CSX Corp.
       
  1,540,000  
  6.22%, due 4/30/40
    1,769,695  
            4,546,075  
Utilities – Gas 0.7%
       
     
National Fuel Gas Co.
       
  1,680,000  
  4.90%, due 12/1/21
    1,766,646  
         
Waste Disposal 0.9%
       
     
Republic Services, Inc.
       
  1,450,000  
  5.00%, due 3/1/20
    1,590,873  
     
Waste Management, Inc.
       
  660,000  
  7.75%, due 5/15/32
    868,696  
            2,459,569  
Wireless Telecommunications
       
Services 4.7%
       
     
Verizon Communications, Inc.
       
  3,200,000  
  3.65%, due 9/14/18
    3,405,933  
  3,450,000  
  5.15%, due 9/15/23
    3,688,778  
  4,900,000  
  6.55%, due 9/15/43
    5,596,050  
            12,690,761  
Total Corporate Bonds
       
  (cost $221,205,968)
    223,536,137  
         
SOVEREIGN BONDS 11.2%
       
     
Federal Republic of Brazil
       
  1,000,000  
  6.00%, due 1/17/17
    1,120,000  
  1,150,000  
  4.875%, due 1/22/21
    1,224,750  
  2,690,000  
  7.125%, due 1/20/37
    3,073,325  
     
Republic of Colombia
       
  1,150,000  
  7.375%, due 3/18/19
    1,394,375  
  890,000  
  7.375%, due 9/18/37
    1,090,250  
     
Republic of Italy
       
  2,150,000  
  6.875%, due 9/27/23
    2,599,780  
     
Republic of Panama
       
  800,000  
  5.20%, due 1/30/20
    870,000  
  500,000  
  6.70%, due 1/26/36
    557,500  
     
Republic of Peru
       
  830,000  
  8.375%, due 5/3/16
    964,875  
  1,050,000  
  6.55%, due 3/14/37
    1,191,750  
     
Republic of Philippines
       
  1,100,000  
  6.50%, due 1/20/20
    1,306,250  
  2,375,000  
  5.00%, due 1/13/37
    2,496,719  
     
Republic Of Turkey
       
  1,400,000  
  7.50%, due 7/14/17
    1,589,350  
  2,300,000  
  5.125%, due 3/25/22
    2,282,750  
  2,200,000  
  6.00%, due 1/14/41
    2,062,500  
     
Republic of Uruguay
       
  359,742  
  8.00%, due 11/18/22
    444,281  
     
United Mexican States
       
  500,000  
  5.625%, due 1/15/17
    560,000  
  2,784,000  
  3.625%, due 3/15/22
    2,765,904  
  2,940,000  
  4.75%, due 3/8/44
    2,596,020  
            30,190,379  
Total Sovereign Bonds
       
  (cost $33,323,349)
    30,190,379  
U.S. GOVERNMENT
       
  INSTRUMENTALITIES 1.6%
       
     
U.S. Treasury Bonds
       
  5,210,000  
  2.875%, due 5/15/43
    4,325,113  
Total U.S. Government Instrumentalities
       
  (cost $4,427,016)
    4,325,113  

The accompanying notes are an integral part of these financial statements.




 
15

 
PIA Funds
PIA BBB BOND FUND
Schedule of Investments – November 30, 2013 (continued)

 
Shares
       
Value
 
SHORT-TERM INVESTMENTS 2.7%
     
  7,166,759  
Invesco STIT – Treasury
       
     
  Portfolio – Institutional
       
        Class, 0.02% (c)     $ 7,166,759  
Total Short-Term Investments
       
  (cost $7,166,759)
    7,166,759  
Total Investments
             
  (cost $266,123,092)
    98.6%     265,218,388  
Other Assets less Liabilities
1.4%     3,859,178  
TOTAL NET ASSETS
100.0%   $ 269,077,566  

(a)
Variable rate security.  Rate shown reflects the rate in effect as of November 30, 2013.
(b)
Security purchased within the terms of a private placement memorandum, exempt from registration under Rule 144A of the Securities Act of 1933, as amended, and may be sold only to dealers in the program or other “qualified institutional buyers.” Pacific Income Advisers, Inc., the Fund’s adviser, has determined that such security is liquid in accordance with the liquidity guidelines approved by the Board of Trustees of Advisors Series Trust.  As of November 30, 2013, the value of these investments was $1,707,249 or 0.6% of total net assets.
(c)
Rate shown is the 7-day annualized yield as of November 30, 2013.

Country Allocation
 
Country
% of Net Assets
   
United States
   78.1%
Brazil
    4.9%
Mexico
    3.9%
Canada
    3.1%
Philippines
    1.4%
Switzerland
    1.1%
United Kingdom
    1.1%
Spain
    1.0%
Italy
    1.0%
Colombia
    0.9%
Peru
    0.8%
Luxembourg
    0.6%
Panama
    0.5%
France
    0.5%
Ireland
    0.4%
Japan
    0.3%
Netherlands
    0.2%
Uruguay
     0.2%
 
100.0%

The accompanying notes are an integral part of these financial statements.

 
 
16

 
PIA Funds
PIA MBS BOND FUND
Schedule of Investments – November 30, 2013

 
Principal Amount
     
Value
 
MORTGAGE-BACKED SECURITIES 107.5%
     
       
Commercial Mortgage-Backed Securities 2.1%
     
   
Banc of America
     
$ 773,729  
  5.716%, due 5/10/45, Series
     
     
  2006-2, Class AAB (a)
  $ 797,465  
     
Hilton USA Trust
       
  1,300,000  
  2.662%, due 11/5/30, Series
       
     
  2013-HLT, Class AFX (d)
    1,301,430  
            2,098,895  
Residential Mortgage-Backed Securities 3.1%
       
     
Invitation Homes Trust
       
  3,000,000  
  1.314%, due 12/17/30, Series
       
     
  2013-SFR1, Class A (a)
    3,007,865  
         
U.S. Government Agencies 102.3%
       
     
FHLMC Pool
       
  52,432  
  4.50%, due 5/1/20, #G18052
    55,789  
  45,795  
  4.50%, due 3/1/21, #G18119
    49,210  
  46,732  
  5.00%, due 3/1/21, #G18105
    50,740  
  195,939  
  4.50%, due 5/1/21, #J01723
    210,311  
  42,153  
  6.00%, due 6/1/21, #G18124
    46,178  
  130,698  
  4.50%, due 9/1/21, #G12378
    140,370  
  41,815  
  5.00%, due 11/1/21, #G18160
    45,399  
  32,520  
  5.00%, due 2/1/22, #G12522
    35,312  
  45,248  
  5.00%, due 2/1/22, #J04411
    49,126  
  136,822  
  5.50%, due 3/1/22, #G12577
    149,622  
  37,556  
  5.00%, due 7/1/22, #J05243
    39,993  
  882,864  
  4.00%, due 3/1/26, #J14785
    938,241  
  2,050,391  
  3.00%, due 11/1/26, #G18409
    2,114,352  
  745,334  
  3.00%, due 6/1/27, #G14497
    768,585  
  15,054  
  5.50%, due 5/1/35, #B31639
    16,477  
  300,692  
  5.00%, due 8/1/35, #A36351
    325,772  
  152,791  
  4.50%, due 9/1/35, #A37616
    162,925  
  285,381  
  4.50%, due 10/1/35, #A37869
    305,042  
  178,351  
  4.50%, due 10/1/35, #A38023
    190,096  
  89,491  
  4.50%, due 10/1/35, #G01890
    95,644  
  165,096  
  5.00%, due 10/1/35, #G01940
    179,047  
  290,128  
  6.00%, due 1/1/36, #A42208
    322,438  
  26,539  
  7.00%, due 1/1/36, #G02048
    30,632  
  244,070  
  5.50%, due 2/1/36, #G02031
    265,593  
  142,281  
  7.00%, due 8/1/36, #G08148
    163,153  
  565,185  
  6.50%, due 9/1/36, #A54908
    638,803  
  179,622  
  6.50%, due 11/1/36, #A54094
    203,401  
  117,418  
  5.50%, due 2/1/37, #A57840
    127,565  
  271,178  
  5.00%, due 5/1/37, #A60268
    292,854  
  196,897  
  5.00%, due 6/1/37, #G03094
    212,803  
  599,434  
  5.50%, due 6/1/37, #A61982
    650,693  
  723,273  
  6.00%, due 6/1/37, #A62176
    794,698  
  954,887  
  6.00%, due 6/1/37, #A62444
    1,050,225  
  164,411  
  5.00%, due 7/1/37, #A63187
    177,553  
  293,418  
  5.50%, due 8/1/37, #G03156
    318,509  
  57,192  
  6.50%, due 8/1/37, #A70413
    63,480  
  15,154  
  7.00%, due 8/1/37, #A70079
    17,431  
  20,376  
  7.00%, due 9/1/37, #A65335
    22,324  
  19,903  
  7.00%, due 9/1/37, #A65670
    21,830  
  46,532  
  7.00%, due 9/1/37, #A65780
    50,593  
  15,098  
  7.00%, due 9/1/37, #A65941
    16,549  
  4,093  
  7.00%, due 9/1/37, #A66041
    4,669  
  106,030  
  7.00%, due 9/1/37, #G03207
    121,418  
  32,081  
  6.50%, due 11/1/37, #A68726
    35,619  
  246,497  
  5.00%, due 2/1/38, #A73370
    266,200  
  9,892  
  5.00%, due 2/1/38, #G03836
    10,696  
  27,633  
  5.00%, due 3/1/38, #A73704
    29,842  
  270,087  
  5.00%, due 4/1/38, #A76335
    291,676  
  117,119  
  5.50%, due 4/1/38, #G04121
    127,134  
  13,063  
  5.00%, due 5/1/38, #A77463
    14,107  
  51,447  
  5.50%, due 5/1/38, #A77265
    55,846  
  125,158  
  5.50%, due 5/1/38, #G04215
    135,861  
  62,003  
  5.00%, due 6/1/38, #A77986
    67,057  
  26,114  
  5.00%, due 6/1/38, #G04522
    28,202  
  29,277  
  5.00%, due 7/1/38, #A79197
    31,617  
  139,413  
  4.50%, due 9/1/38, #G04773
    148,701  
  37,807  
  5.00%, due 9/1/38, #G04690
    40,844  
  672,072  
  5.00%, due 10/1/38, #G04832
    725,798  
  7,442  
  5.00%, due 11/1/38, #A82849
    8,036  
  38,185  
  5.00%, due 12/1/38, #G05683
    41,247  

The accompanying notes are an integral part of these financial statements.




 
17

 
PIA Funds
PIA MBS BOND FUND
Schedule of Investments – November 30, 2013 (continued)

 
Principal Amount
     
Value
 
U.S. Government Agencies 102.3% (continued)
     
   
FHLMC Pool (continued)
     
$ 379,476  
  5.00%, due 2/1/39, #G05507
  $ 410,149  
  59,000  
  4.50%, due 4/1/39, #A85612
    62,984  
  172,709  
  5.00%, due 5/1/39, #G08345
    186,721  
  152,563  
  4.50%, due 9/1/39, #A88357
    163,005  
  60,569  
  5.00%, due 9/1/39, #G05904
    65,435  
  261,231  
  4.50%, due 11/1/39, #G05748
    279,153  
  227,665  
  4.50%, due 12/1/39, #A90175
    243,071  
  69,666  
  4.50%, due 4/1/40, #C03464
    74,423  
  187,713  
  4.50%, due 5/1/40, #A92269
    200,457  
  1,017,377  
  4.50%, due 5/1/40, #G06047
    1,086,330  
  629,093  
  4.50%, due 6/1/40, #A92533
    672,053  
  111,920  
  4.50%, due 6/1/40, #A92594
    119,543  
  32,076  
  4.50%, due 8/1/40, #A93437
    34,190  
  991,064  
  4.50%, due 8/1/40, #A93505
    1,058,570  
  2,366,470  
  3.50%, due 1/1/41, #A96409
    2,388,258  
  310,910  
  4.50%, due 1/1/41, #A96176
    332,001  
  83,915  
  4.50%, due 2/1/41, #A97013
    89,489  
  65,629  
  4.50%, due 4/1/41, #Q00285
    70,119  
  1,003,322  
  4.50%, due 9/1/41, #C03701
    1,071,398  
  175,227  
  3.50%, due 10/1/41, #Q04087
    176,840  
  77,502  
  4.50%, due 11/1/41, #Q04699
    82,743  
  207,782  
  3.50%, due 1/1/42, #Q05410
    209,695  
  763,560  
  3.50%, due 2/1/42, #Q05996
    770,590  
  495,930  
  3.50%, due 3/1/42, #G08479
    500,496  
  3,050,472  
  3.50%, due 4/1/42, #Q07654
    3,078,557  
  1,378,155  
  3.50%, due 5/1/42, #G08491
    1,390,843  
  2,374,287  
  3.50%, due 6/1/42, #C09000
    2,396,147  
  2,110,281  
  3.50%, due 6/1/42, #Q08641
    2,129,710  
  737,706  
  3.50%, due 8/1/42, #Q10324
    744,498  
  66,381  
  3.00%, due 4/1/43, #V80025
    63,981  
  362,165  
  3.00%, due 5/1/43, #Q18436
    348,503  
  196,492  
  3.00%, due 6/1/43, #Q19697
    189,387  
  798,143  
  3.50%, due 6/1/43, #V80161
    804,245  
  26,819  
  3.50%, due 7/1/43, #Q19628
    27,066  
  938,405  
  3.50%, due 7/1/43, #Q19914
    946,699  
  727,209  
  3.00%, due 8/1/43, #G08540
    700,912  
  397,766  
  3.00%, due 8/1/43, #Q20559
    383,382  
  234,787  
  3.00%, due 8/1/43, #Q21026
    225,930  
  883,536  
  3.50%, due 8/1/43, #Q21351
    891,671  
  280,180  
  3.50%, due 8/1/43, #Q21435
    282,759  
  122,411  
  3.50%, due 9/1/43, #G08545
    123,538  
     
FHLMC TBA (b)
       
  1,000,000  
  3.00%, due 12/15/27
    1,028,516  
  5,000,000  
  4.00%, due 12/15/40
    5,198,242  
  4,000,000  
  3.50%, due 12/15/41
    4,025,781  
     
FNMA Pool
       
  23,916  
  4.50%, due 10/1/20, #842732
    25,491  
  137,373  
  3.00%, due 12/1/20, #MA0605
    142,968  
  61,600  
  4.50%, due 12/1/20, #813954
    65,777  
  35,142  
  4.50%, due 2/1/21, #845437
    37,453  
  71,872  
  5.00%, due 2/1/21, #865191
    77,533  
  24,946  
  5.00%, due 5/1/21, #879112
    26,940  
  108,560  
  4.50%, due 7/1/21, #845515
    115,749  
  2,249,949  
  3.00%, due 8/1/21, #AL0579
    2,341,445  
  83,440  
  5.50%, due 10/1/21, #905090
    88,586  
  224,122  
  3.00%, due 1/1/22, #MA0957
    233,254  
  41,964  
  5.00%, due 2/1/22, #900946
    45,321  
  127,006  
  6.00%, due 2/1/22, #912522
    139,633  
  147,869  
  5.00%, due 6/1/22, #937709
    159,997  
  75,507  
  5.00%, due 7/1/22, #938033
    81,694  
  98,756  
  5.00%, due 7/1/22, #944887
    107,075  
  359,372  
  5.50%, due 7/1/22, #905040
    393,062  
  16,660  
  4.00%, due 7/1/25, #AE1318
    17,782  
  17,614  
  4.00%, due 10/1/25, #AE1601
    18,798  
  612,623  
  4.00%, due 12/1/25, #AH6058
    657,124  
  458,693  
  4.00%, due 1/1/26, #AH3925
    489,806  
  20,029  
  4.00%, due 1/1/26, #MA0624
    21,382  
  57,726  
  4.00%, due 3/1/26, #AH8485
    61,617  
  801,639  
  4.00%, due 5/1/26, #AH8174
    855,912  
  86,032  
  3.00%, due 10/1/26, #AJ0049
    88,897  
  34,780  
  3.00%, due 10/1/26, #AJ5474
    35,933  
  114,484  
  3.00%, due 2/1/27, #AK4047
    118,332  
  257,979  
  3.00%, due 4/1/27, #AB4997
    266,643  
  855,076  
  3.00%, due 9/1/27, #AQ0333
    883,891  

The accompanying notes are an integral part of these financial statements.




 
18

 
PIA Funds
PIA MBS BOND FUND
Schedule of Investments – November 30, 2013 (continued)

 
Principal Amount
     
Value
 
U.S. Government Agencies 102.3% (continued)
     
   
FNMA Pool (continued)
     
$ 159,324  
  4.50%, due 4/1/29, #MA0022
  $ 170,820  
  4,390  
  7.00%, due 8/1/32, #650101
    5,153  
  79,571  
  4.50%, due 3/1/35, #814433
    85,204  
  75,599  
  4.50%, due 4/1/35, #735396
    80,965  
  26,703  
  4.50%, due 5/1/35, #822854
    28,526  
  28,671  
  7.00%, due 6/1/35, #821610
    32,598  
  57,769  
  4.50%, due 7/1/35, #826584
    61,767  
  7,040  
  5.00%, due 7/1/35, #833958
    7,659  
  35,848  
  7.00%, due 7/1/35, #826251
    41,074  
  66,382  
  4.50%, due 8/1/35, #835751
    71,030  
  29,541  
  7.00%, due 9/1/35, #842290
    34,050  
  22,443  
  4.50%, due 11/1/35, #256032
    23,984  
  44,626  
  5.00%, due 12/1/35, #852482
    48,564  
  14,567  
  4.50%, due 1/1/36, #852510
    15,564  
  16,019  
  7.00%, due 2/1/36, #865190
    18,745  
  21,022  
  7.00%, due 4/1/36, #887709
    23,046  
  460,927  
  5.00%, due 5/1/36, #745515
    501,601  
  10,441  
  5.00%, due 7/1/36, #888789
    11,359  
  25,891  
  6.50%, due 7/1/36, #897100
    28,757  
  69,684  
  7.00%, due 7/1/36, #887793
    79,906  
  65,082  
  6.00%, due 8/1/36, #892925
    72,656  
  141,049  
  6.50%, due 8/1/36, #878187
    157,175  
  100,289  
  5.00%, due 9/1/36, #893621
    109,055  
  135,021  
  5.50%, due 10/1/36, #831845
    148,176  
  57,694  
  5.50%, due 10/1/36, #893087
    63,135  
  44,637  
  6.00%, due 10/1/36, #897174
    49,176  
  86,437  
  5.50%, due 12/1/36, #256513
    94,650  
  1,709  
  6.50%, due 12/1/36, #920162
    1,901  
  58,680  
  7.00%, due 1/1/37, #256567
    65,638  
  182,661  
  5.50%, due 2/1/37, #256597
    199,939  
  108,015  
  6.00%, due 2/1/37, #909357
    119,106  
  3,417  
  7.00%, due 2/1/37, #915904
    3,734  
  86,690  
  5.00%, due 3/1/37, #913007
    94,267  
  131,776  
  5.50%, due 3/1/37, #256636
    144,203  
  7,602  
  5.00%, due 4/1/37, #914599
    8,266  
  64,128  
  6.50%, due 5/1/37, #917052
    71,227  
  510,306  
  5.50%, due 6/1/37, #918554
    559,084  
  109,671  
  5.50%, due 6/1/37, #918705
    120,024  
  529,007  
  6.00%, due 6/1/37, #888413
    583,364  
  334,775  
  6.00%, due 6/1/37, #917129
    369,590  
  61,589  
  7.00%, due 6/1/37, #256774
    69,617  
  48,659  
  7.00%, due 6/1/37, #940234
    56,032  
  32,327  
  5.00%, due 7/1/37, #944534
    35,152  
  207,868  
  5.50%, due 10/1/37, #954939
    227,552  
  58,096  
  6.00%, due 12/1/37, #965488
    64,034  
  381,649  
  5.50%, due 2/1/38, #961691
    417,481  
  111,216  
  5.00%, due 1/1/39, #AA0835
    120,952  
  29,390  
  5.00%, due 1/1/39, #AA0840
    31,963  
  1,369  
  5.00%, due 1/1/39, #AA0862
    1,489  
  68,737  
  4.00%, due 2/1/39, #930606
    71,848  
  5,906  
  5.00%, due 3/1/39, #AA4461
    6,422  
  182,415  
  5.00%, due 3/1/39, #930635
    198,537  
  5,070  
  5.00%, due 3/1/39, #930760
    5,513  
  24,247  
  5.00%, due 3/1/39, #995948
    26,387  
  24,769  
  4.00%, due 4/1/39, #AA0777
    25,894  
  450,919  
  4.00%, due 4/1/39, #AO3504
    470,939  
  102,553  
  4.50%, due 4/1/39, #AA4590
    109,658  
  210,949  
  5.00%, due 4/1/39, #930871
    229,387  
  173,908  
  5.00%, due 4/1/39, #930992
    189,152  
  129,886  
  5.00%, due 4/1/39, #995930
    141,253  
  510,624  
  4.50%, due 6/1/39, #AA7681
    545,863  
  179,848  
  5.00%, due 6/1/39, #995896
    195,697  
  386,508  
  4.50%, due 7/1/39, #AE8152
    412,745  
  133,090  
  5.00%, due 7/1/39, #995895
    144,723  
  621,581  
  4.50%, due 8/1/39, #931837
    664,347  
  559,370  
  5.00%, due 8/1/39, #AC3221
    609,279  
  1,684,737  
  4.00%, due 12/1/39, #AE0215
    1,762,601  
  180,661  
  4.50%, due 12/1/39, #932324
    193,105  
  34,238  
  4.50%, due 2/1/40, #AC8494
    36,614  
  93,972  
  4.50%, due 2/1/40, #AD1045
    100,440  
  88,428  
  4.50%, due 2/1/40, #AD2832
    94,546  
  46,217  
  5.00%, due 3/1/40, #AB1186
    50,341  
  2,227,590  
  5.00%, due 5/1/40, #AD6374
    2,431,712  
  30,740  
  5.00%, due 6/1/40, #AD8058
    33,547  

The accompanying notes are an integral part of these financial statements.




 
19

 
PIA Funds
PIA MBS BOND FUND
Schedule of Investments – November 30, 2013 (continued)

 
Principal Amount
     
Value
 
U.S. Government Agencies 102.3% (continued)
     
   
FNMA Pool (continued)
     
$ 264,240  
  5.00%, due 7/1/40, #AD4634
  $ 288,773  
  389,906  
  5.00%, due 7/1/40, #AD4994
    424,903  
  38,256  
  5.00%, due 7/1/40, #AD7565
    41,742  
  974,101  
  4.50%, due 8/1/40, #AD8035
    1,041,466  
  166,546  
  4.50%, due 8/1/40, #AD8397
    178,179  
  252,964  
  4.50%, due 8/1/40, #890236
    270,541  
  302,280  
  4.00%, due 9/1/40, #AE4311
    315,952  
  35,518  
  4.00%, due 9/1/40, #AE4312
    37,141  
  720,900  
  4.50%, due 9/1/40, #AE1500
    770,776  
  86,193  
  4.00%, due 10/1/40, #AE4124
    90,097  
  293,646  
  4.00%, due 10/1/40, #AE6057
    307,030  
  23,724  
  4.00%, due 11/1/40, #AE5156
    24,801  
  161,168  
  4.50%, due 11/1/40, #AE5162
    172,459  
  538,007  
  4.00%, due 12/1/40, #MA0583
    562,437  
  153,000  
  4.00%, due 1/1/41, #AE4583
    159,950  
  242,281  
  4.00%, due 2/1/41, #AH3200
    253,281  
  408,403  
  4.50%, due 3/1/41, #AH7009
    437,096  
  1,490,583  
  4.50%, due 4/1/41, #AH9054
    1,595,619  
  42,464  
  4.50%, due 5/1/41, #AI1364
    45,459  
  315,430  
  4.50%, due 5/1/41, #AI1888
    337,669  
  1,968,747  
  4.50%, due 5/1/41, #AL0160
    2,112,279  
  203,155  
  4.50%, due 6/1/41, #AI4815
    217,456  
  86,371  
  4.00%, due 7/1/41, #AI0038
    90,314  
  19,981  
  4.00%, due 8/1/41, #AI8218
    20,890  
  27,800  
  4.50%, due 9/1/41, #AH3865
    29,762  
  93,873  
  4.50%, due 9/1/41, #AI4050
    100,471  
  24,548  
  4.50%, due 9/1/41, #AJ0729
    26,290  
  244,296  
  4.00%, due 10/1/41, #AJ4052
    255,413  
  1,420,171  
  4.00%, due 11/1/41, #AJ4668
    1,484,912  
  642,933  
  4.00%, due 11/1/41, #AJ5643
    672,242  
  205,022  
  4.00%, due 12/1/41, #AJ3097
    214,340  
  454,110  
  4.00%, due 2/1/42, #AJ9774
    478,188  
  379,210  
  4.00%, due 4/1/42, #MA1028
    396,485  
  2,989,837  
  3.50%, due 7/1/43, #AB9774
    3,022,334  
  1,986,826  
  3.00%, due 8/1/43, #AU3363
    1,922,720  
     
FNMA TBA (b)
       
  400,000  
  3.00%, due 12/15/25
    412,313  
  2,000,000  
  4.00%, due 12/15/41
    2,086,875  
     
GNMA Pool
       
  25,601  
  7.00%, due 9/15/35, #647831
    29,465  
  75,179  
  5.00%, due 10/15/35, #642220
    81,686  
  76,420  
  5.00%, due 11/15/35, #550718
    83,863  
  83,220  
  5.50%, due 11/15/35, #650091
    91,940  
  49,104  
  5.50%, due 12/15/35, #646307
    54,180  
  72,444  
  5.50%, due 4/15/36, #652534
    80,038  
  56,932  
  6.50%, due 6/15/36, #652593
    63,515  
  35,365  
  5.50%, due 7/15/36, #608993
    39,019  
  69,276  
  6.50%, due 10/15/36, #646564
    77,286  
  42,369  
  6.00%, due 11/15/36, #617294
    47,103  
  139,537  
  6.50%, due 12/15/36, #618753
    161,824  
  106,100  
  5.50%, due 2/15/37, #658419
    116,520  
  346,009  
  6.00%, due 4/15/37, #668411
    384,364  
  334,422  
  5.00%, due 8/15/37, #671463
    364,824  
  154,103  
  6.00%, due 10/15/37, #664379
    171,267  
  29,593  
  5.50%, due 8/15/38, #677224
    32,516  
  205,257  
  5.50%, due 8/15/38, #691314
    225,521  
  8,040  
  5.50%, due 12/15/38, #705632
    8,834  
  1,005,496  
  4.50%, due 5/15/39, #717066
    1,084,040  
  23,898  
  5.50%, due 6/15/39, #714262
    26,247  
  942,824  
  5.50%, due 6/15/39, #714720
    1,035,430  
  894,310  
  4.50%, due 7/15/39, #720160
    963,883  
  2,539,302  
  5.00%, due 9/15/39, #726311
    2,763,840  
  14,968  
  5.50%, due 1/15/40, #723631
    16,437  
  54,651  
  5.50%, due 2/15/40, #680537
    60,002  
            99,661,962  
Total Mortgage-Backed Securities
       
  (cost $102,104,628)
    104,768,722  
U.S. GOVERNMENT
       
  INSTRUMENTALITIES 6.7%
       
U.S. Treasury Notes 6.7%
       
     
U.S. Treasury Note
       
  6,500,000  
  0.75%, due 12/15/13
    6,501,651  
Total U.S. Government Instrumentalities
       
  (cost $6,501,610)
    6,501,651  

The accompanying notes are an integral part of these financial statements.


 
20

 
PIA Funds
PIA MBS BOND FUND
Schedule of Investments – November 30, 2013 (continued)
 
Shares
       
Value
 
               
SHORT-TERM INVESTMENTS 0.3%
       
  256,428  
Fidelity Institutional Money
       
     
  Market Government
       
     
  Portfolio – Class I, 0.01% (c)
    $ 256,428  
 
Total Short-Term Investments
         
  (cost $256,428)
      256,428  
Total Investments
           
  (cost $108,862,666)
114.5 %     111,526,801  
Liabilities less
  Other Assets
(14.5 )%     (14,087,380 )
TOTAL NET ASSETS
100.0 %   $ 97,439,421  

(a)
Variable rate security.  Rate shown reflects the rate in effect as of November 30, 2013.
(b)
Security purchased on a when-issued basis.  As of November 30, 2013, the total cost of investments purchased on a when-issued basis was $12,815,719 or 13.2% of total net assets.
(c)
Rate shown is the 7-day annualized yield as of November 30, 2013.
(d)
Security valued at fair value using methods determined in good faith by or at the direction of the Board of Trustees.
FHLMC – Federal Home Loan Mortgage Corporation
FNMA – Federal National Mortgage Association
GNMA – Government National Mortgage Association
TBA – To Be Announced
 

 
The accompanying notes are an integral part of these financial statements.




 
21

 
PIA Funds
Statements of Assets and Liabilities – November 30, 2013

   
BBB
   
MBS
 
   
Bond Fund
   
Bond Fund
 
Assets:
           
      Investments in securities, at value (cost $266,123,092 and $108,862,666, respectively)
  $ 265,218,388     $ 111,526,801  
      Deposit at broker for futures contracts
          1,000  
      Receivable for fund shares sold
    104,917       64,905  
      Receivable for investments sold
    604,008        
      Interest receivable
    3,340,524       322,745  
      Due from investment adviser (Note 4)
    37,454       22,188  
      Collateral receivable from broker
          299  
      Prepaid expenses
    24,466       8,494  
            Total assets
    269,329,757       111,946,432  
                 
Liabilities:
               
      Payable for securities purchased
          14,116,775  
      Payable for fund shares redeemed
    171,343       334,086  
      Administration fees
    10,467       6,822  
      Custody fees
    5,122       4,770  
      Transfer agent fees and expenses
    19,479       7,654  
      Fund accounting fees
    16,892       12,517  
      Audit fees
    17,979       17,980  
      Chief Compliance Officer fee
    1,238       994  
      Accrued expenses
    9,671       5,413  
            Total liabilities
    252,191       14,507,011  
      Net Assets
  $ 269,077,566     $ 97,439,421  
                 
Net Assets Consist of:
               
      Paid-in capital
  $ 260,445,339     $ 96,171,902  
      Undistributed net investment income
    150,448       179,488  
      Accumulated net realized gain/(loss) on investments
    9,386,483       (1,576,104 )
      Net unrealized appreciation/(depreciation) on investments
    (904,704 )     2,664,135  
            Net Assets
  $ 269,077,566     $ 97,439,421  
                 
Net Asset Value, Offering Price and Redemption Price Per Share
  $ 9.48     $ 9.65  
                 
Shares Issued and Outstanding
               
  (Unlimited number of shares authorized, par value $0.01)
    28,384,594       10,098,920  

The accompanying notes are an integral part of these financial statements.




 
22

 
PIA Funds
Statements of Operations – Year Ended November 30, 2013

   
BBB
   
MBS
 
   
Bond Fund
   
Bond Fund
 
Investment Income:
           
      Interest
  $ 13,287,093     $ 2,242,147  
                 
            Total investment income
    13,287,093       2,242,147  
                 
Expenses:
               
      Transfer agent fees and expenses (Note 4)
    122,286       51,755  
      Fund accounting fees (Note 4)
    109,986       82,431  
      Administration fees (Note 4)
    71,432       47,989  
      Registration fees
    43,911       24,587  
      Custody fees (Note 4)
    27,040       32,725  
      Audit fees
    18,000       17,999  
      Trustees’ fees
    15,955       9,446  
      Insurance
    12,256       7,702  
      Reports to shareholders
    10,419       4,748  
      Legal fees
    9,455       7,706  
      Chief Compliance Officer fee (Note 4)
    7,425       6,578  
      Miscellaneous
    18,473       9,288  
            Total expenses
    466,638       302,954  
      Less: Expense reimbursement from adviser (Note 4)
    (466,638 )     (302,954 )
            Net expenses
           
            Net investment income
    13,287,093       2,242,147  
                 
Realized and Unrealized Gain/(Loss) on Investments
               
      Net realized gain/(loss) on investments
    9,444,943       (576,653 )
      Net change in unrealized appreciation/(depreciation) on investments
    (31,323,308 )     (2,840,853 )
            Net loss on investments
    (21,878,365 )     (3,417,506 )
      Net decrease in net assets resulting from operations
  $ (8,591,272 )   $ (1,175,359 )

The accompanying notes are an integral part of these financial statements.




 
23

 
PIA Funds
Statements of Changes in Net Assets

   
BBB
   
MBS
 
   
Bond Fund
   
Bond Fund
 
   
Year Ended
   
Year Ended
   
Year Ended
   
Year Ended
 
   
Nov. 30, 2013
   
Nov. 30, 2012
   
Nov. 30, 2013
   
Nov. 30, 2012
 
Increase/(Decrease) in Net Assets From
                       
Operations:
                       
      Net investment income
  $ 13,287,093     $ 14,575,233     $ 2,242,147     $ 3,221,176  
      Net realized gain/(loss) on investments
    9,444,943       10,535,741       (576,653 )     2,435,684  
      Net change in unrealized appreciation/(depreciation)
                               
        on investments
    (31,323,308 )     12,011,067       (2,840,853 )     (93,216 )
      Net increase/(decrease) in net assets
                               
        resulting from operations
    (8,591,272 )     37,122,041       (1,175,359 )     5,563,644  
                                 
Distributions Paid to Shareholders:
                               
      Distributions from net investment income
    (13,268,656 )     (14,556,232 )     (3,275,971 )     (4,395,560 )
      Distributions from net realized gains on investments
    (10,431,614 )     (14,474,369 )     (1,282,470 )     (315,468 )
      Total distributions
    (23,700,270 )     (29,030,601 )     (4,558,441 )     (4,711,028 )
                                 
Capital Share Transactions:
                               
      Net proceeds from shares sold
    57,925,359       176,489,927       20,897,098       54,451,855  
      Distributions reinvested
    6,041,576       9,280,246       1,949,234       2,131,121  
      Payment for shares redeemed
    (145,508,386 )     (84,888,859 )     (104,174,979 )     (21,303,919 )
      Net increase/(decrease) in net assets
                               
        from capital share transactions
    (81,541,451 )     100,881,314       (81,328,647 )     35,279,057  
      Total increase/(decrease) in net assets
    (113,832,993 )     108,972,754       (87,062,447 )     36,131,673  
                                 
Net Assets, Beginning of Year
    382,910,559       273,937,805       184,501,868       148,370,195  
Net Assets, End of Year
  $ 269,077,566     $ 382,910,559     $ 97,439,421     $ 184,501,868  
Includes Undistributed Net Investment Income of
  $ 150,448     $ 132,074     $ 179,488     $ 213,900  
                                 
Transactions in Shares:
                               
      Shares sold
    5,911,780       17,325,808       2,129,701       5,431,616  
      Shares issued on reinvestment of distributions
    609,868       936,282       198,459       212,752  
      Shares redeemed
    (14,922,891 )     (8,382,500 )     (10,604,288 )     (2,122,494 )
      Net increase/(decrease) in shares outstanding
    (8,401,243 )     9,879,590       (8,276,128 )     3,521,874  

The accompanying notes are an integral part of these financial statements.




 
24

 
PIA Funds
BBB BOND FUND
Financial Highlights

   
Year Ended November 30,
 
   
2013
   
2012
   
2011
   
2010
   
2009
 
Per Share Operating Performance
                             
(For a fund share outstanding throughout each year)
                             
                               
Net asset value, beginning of year
  $ 10.41     $ 10.18     $ 10.14     $ 9.70     $ 7.76  
                                         
Income From Investment Operations:
                                       
Net investment income
    0.39       0.46       0.53       0.54       0.56  
Net realized and unrealized gain/(loss)
                                       
  on investments and swap contracts
    (0.64 )     0.77       0.05       0.44       1.95  
Total from investment operations
    (0.25 )     1.23       0.58       0.98       2.51  
                                         
Less Distributions:
                                       
Distributions from net investment income
    (0.39 )     (0.46 )     (0.54 )     (0.54 )     (0.57 )
Distributions from net realized gains on investments
    (0.29 )     (0.54 )                  
Total distributions
    (0.68 )     (1.00 )     (0.54 )     (0.54 )     (0.57 )
                                         
Net asset value, end of year
  $ 9.48     $ 10.41     $ 10.18     $ 10.14     $ 9.70  
                                         
Total Return
    -2.49 %     12.89 %     5.88 %     10.33 %     33.28 %
                                         
Ratios/Supplemental Data:
                                       
Net assets, end of year (in 000’s)
  $ 269,078     $ 382,911     $ 273,938     $ 337,421     $ 331,490  
Ratio of expenses to average net assets:
                                       
      Net of expense reimbursement
    0.00 %     0.00 %     0.00 %     0.00 %     0.00 %
      Before expense reimbursement
    0.14 %     0.13 %     0.13 %     0.12 %     0.14 %
Ratio of net investment income to average net assets:
                                       
      Net of expense reimbursement
    3.99 %     4.61 %     5.13 %     5.41 %     6.35 %
      Before expense reimbursement
    3.85 %     4.48 %     5.00 %     5.29 %     6.21 %
Portfolio turnover rate
    47 %     75 %     58 %     45 %     84 %

The accompanying notes are an integral part of these financial statements.




 
25

 
PIA Funds
MBS BOND FUND
Financial Highlights

   
Year Ended November 30,
 
   
2013
   
2012
   
2011
   
2010
   
2009
 
Per Share Operating Performance
                             
(For a fund share outstanding throughout each year)
                             
                               
Net asset value, beginning of year
  $ 10.04     $ 9.99     $ 10.14     $ 10.14     $ 10.35  
                                         
Income From Investment Operations:
                                       
Net investment income
    0.15       0.19       0.28       0.32       0.49  
Net realized and unrealized gain on investments
    (0.23 )     0.14       0.13       0.11       0.38  
Total from investment operations
    (0.08 )     0.33       0.41       0.43       0.87  
                                         
Less Distributions:
                                       
Distributions from net investment income
    (0.24 )     (0.26 )     (0.35 )     (0.34 )     (0.51 )
Distributions from net realized gains on investments
    (0.07 )     (0.02 )     (0.21 )     (0.09 )     (0.57 )
Total distributions
    (0.31 )     (0.28 )     (0.56 )     (0.43 )     (1.08 )
                                         
Net asset value, end of year
  $ 9.65     $ 10.04     $ 9.99     $ 10.14     $ 10.14  
                                         
Total Return
    -0.74 %     3.37 %     4.32 %     4.37 %     9.05 %
                                         
Ratios/Supplemental Data:
                                       
Net assets, end of year (in 000’s)
  $ 97,439     $ 184,502     $ 148,370     $ 122,332     $ 106,098  
Ratio of expenses to average net assets:
                                       
      Net of expense reimbursement
    0.00 %     0.00 %     0.00 %     0.00 %     0.00 %
      Before expense reimbursement
    0.22 %     0.17 %     0.18 %     0.19 %     0.20 %
Ratio of net investment income to average net assets:
                                       
      Net of expense reimbursement
    1.65 %     1.90 %     2.83 %     3.22 %     4.93 %
      Before expense reimbursement
    1.43 %     1.73 %     2.65 %     3.03 %     4.73 %
Portfolio turnover rate
    290 %     278 %     122 %     388 %     108 %

The accompanying notes are an integral part of these financial statements.




 
26

 
PIA Funds
Notes to Financial Statements – November 30, 2013

Note 1 – Organization
 
The PIA BBB Bond Fund and the PIA MBS Bond Fund (the “Funds”) are each a series of Advisors Series Trust (the “Trust”), which is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company.  Currently, the Funds offer the Managed Account Completion Shares (MACS) class.  Each of the Funds is diversified and has separate assets and liabilities and differing investment objectives.  The investment objective of the PIA BBB Bond Fund (the “BBB Bond Fund”) is to seek to provide a total rate of return that approximates that of bonds rated within the BBB category by Standard and Poor’s Rating Group, the Baa category by Moody’s Investors Services or the BBB category by Fitch, Inc.  The investment objective of the PIA MBS Bond Fund (the “MBS Bond Fund”) is to seek to provide a total rate of return that approximates that of mortgage-backed securities (“MBS”) included in the Barclays Capital U.S. MBS Fixed Rate Index.  The BBB Bond Fund and the MBS Bond Fund commenced operations on September 25, 2003 and February 28, 2006, respectively.  Only authorized investment advisory clients of Pacific Income Advisers, Inc. are eligible to invest in the Funds.
 
Note 2 – Significant Accounting Policies
 
The following is a summary of significant accounting policies consistently followed by the Funds in the preparation of their financial statements. These policies are in conformity with accounting principles generally accepted in the United States of America.
 
Security Valuation – All investments in securities are recorded at their estimated fair value, as described in Note 3.
 
Securities Purchased on a When-Issued Basis – Delivery and payment for securities that have been purchased by the Funds on a forward-commitment or when-issued basis can take place up to a month or more after the transaction date.  During this period, such securities are subject to market fluctuations. The Funds are required to hold and maintain until the settlement date, cash or other liquid assets in an amount sufficient to meet the purchase price.  The purchase of securities on a when-issued or forward-commitment basis may increase the volatility of the Funds’ net asset values if the Funds make such purchases while remaining substantially fully invested.  In connection with the ability to purchase securities on a when-issued basis, the Funds may also enter into dollar rolls in which the Funds sell securities purchased on a forward-commitment basis and simultaneously contract with a counterparty to repurchase similar (same type, coupon, and maturity), but not identical securities on a specified future date.  As an inducement for the Funds to “rollover” their purchase commitments, the Funds receive negotiated amounts in the form of reductions of the purchase price of the commitment.  Dollar rolls are considered a form of leverage.
 
Federal Income Taxes – It is the Funds’ policy to comply with the requirements of Subchapter M of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders.  Therefore, no Federal income or excise tax provision is required.
 
The Funds recognize the tax benefits of uncertain tax positions only where the position is “more likely than not” to be sustained assuming examination by tax authorities.  Management has analyzed the Funds’ tax positions, and has concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions taken on returns filed for open tax years 2010 – 2012, or expected to be taken in the Funds’ 2013 tax returns.  The Funds identify their major tax jurisdictions as U.S. Federal and the state of Wisconsin; however the Funds are not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next twelve months.
 

 

 

 

 
27

 
PIA Funds
Notes to Financial Statements – November 30, 2013 (continued)

 
Expenses – Each Fund is charged for those expenses that are directly attributable to the Fund, such as administration and custodian fees.  Expenses that are not directly attributable to a Fund are typically allocated among the Funds in proportion to their respective net assets.
 
Securities Transactions and Investment Income – Security transactions are accounted for on a trade date basis. Realized gains and losses on sales of securities are calculated on the basis of identified cost.  Interest income is recorded on an accrual basis.  Discounts and premiums on securities purchased are amortized over the life of the respective security.
 
Distributions to Shareholders – Distributions to shareholders are recorded on the ex-dividend date.  The Funds distribute substantially all net investment income, if any, monthly and net realized gains, if any, annually.  The amount and character of income and net realized gains to be distributed are determined in accordance with Federal income tax rules and regulations, which may differ from accounting principles generally accepted in the United States of America.  To the extent that these differences are attributable to permanent book and tax accounting differences, the components of net assets have been adjusted.
 
Reclassification of Capital Accounts – Accounting principles generally accepted in the United States of America require that certain components of net assets relating to permanent differences be reclassified between financial and tax reporting.  These reclassifications have no effect on net assets or net asset value per share.
 
For the year ended November 30, 2013, the Funds made the following permanent tax adjustments on the statements of assets and liabilities:
   
Accumulated Net
 
 
Undistributed Net
Realized
 
 
Investment Income
Gain/(Loss)
Paid-in Capital
BBB Bond Fund
$        (63)
$           63
$    —
MBS Bond Fund
999,412
     (999,412)
      —
 
Guarantees and Indemnifications – In the normal course of business, the Funds enter into contracts with service providers that contain general indemnification clauses.  The Funds’ maximum exposure under these arrangements is unknown as this would involve future claims against the Funds that have not yet occurred.  Based on experience, the Funds expect the risk of loss to be remote.
 
Use of Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operation during the reporting period.  Actual results could differ from those estimates.
 
Events Subsequent to the Fiscal Year End – In preparing the financial statements as of November 30, 2013, management considered the impact of subsequent events for the potential recognition or disclosure in these financial statements.
 
Note 3 – Securities Valuation
 
The Funds have adopted authoritative fair value accounting standards which establish an authoritative definition of fair value and set out a hierarchy for measuring fair value.  These standards require additional disclosures about the
 

 

 

 

 
28

 
PIA Funds
Notes to Financial Statements – November 30, 2013 (continued)

 
various inputs and valuation techniques used to develop the measurements of fair value, a discussion in changes in valuation techniques and related inputs during the period and expanded disclosure of valuation levels for major security types.  These inputs are summarized in the three broad levels listed below:
 
  Level 1 –
Unadjusted quoted prices in active markets for identical assets or liabilities that the Funds have the ability to access.
 
  Level 2 –
Observable inputs other than quoted prices included in level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data.
 
  Level 3 –
Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Funds’ own assumptions about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available.
 
 
Following is a description of the valuation techniques applied to the Funds’ major categories of assets and liabilities measured at fair value on a recurring basis.  The Funds’ investments are carried at fair value.
 
Investment Companies – Investments in open-end mutual funds are valued at their net asset value per share.  To the extent, these securities are actively traded and valuation adjustments are not applied, they are categorized in level 1 of the fair value hierarchy.
 
Corporate Bonds – Corporate bonds, including listed issues, are valued at market on the basis of valuations furnished by an independent pricing service which utilizes both dealer-supplied valuations and formula-based techniques.  The pricing service may consider recently executed transactions in securities of the issuer or comparable issuers, market price quotations (where observable), bond spreads, and fundamental data relating to the issuer.  Most corporate bonds are categorized in level 2 of the fair value hierarchy.
 
Foreign Securities – Foreign economies may differ from the U.S. economy and individual foreign companies may differ from domestic companies in the same industry.
 
Foreign companies or entities are frequently not subject to accounting and financial reporting standards applicable to domestic companies, and there may be less information available about foreign issuers.  Securities of foreign issuers are generally less liquid and more volatile than those of comparable domestic issuers.  There is frequently less government regulation of broker-dealers and issuers than in the United States.  In addition, investments in foreign countries are subject to the possibility of expropriation, confiscatory taxation, political or social instability or diplomatic developments that could adversely affect the value of those investments.
 
All foreign securities owned by the BBB Bond Fund are U.S. dollar denominated.
 
U.S. Government Securities – U.S. government securities are normally valued using a model that incorporates market observable data such as reported sales of similar securities, broker quotes, yields, bids, offers, and reference data.  Certain securities are valued principally using dealer quotations.  U.S. government securities are typically categorized in level 2 of the fair value hierarchy.
 

 

 

 

 
29

 
PIA Funds
Notes to Financial Statements – November 30, 2013 (continued)

 
U.S. Government Agency Securities – U.S. government agency securities are comprised of two main categories consisting of agency issued debt and mortgage pass-throughs.  Agency issued debt securities are generally valued in a manner similar to U.S. government securities.  Mortgage pass-throughs include to-be-announced (“TBAs”) securities and mortgage pass-through certificates.  TBA securities and mortgage pass-throughs are generally valued using dealer quotations.  These securities are typically categorized in level 2 of the fair value hierarchy.
 
Derivative Instruments – Listed derivatives that are actively traded are valued based on quoted prices from the exchange and are categorized in level 1 of the fair value hierarchy.  Credit default swaps are valued daily based upon quotations from market makers and are typically categorized in level 2 of the fair value hierarchy.  The Funds did not hold derivative instruments during the year ended November 30, 2013.
 
Short-Term Securities – Short-term securities which mature in 60 days or less are valued at amortized cost (unless the Board of Trustees determines that this method does not represent fair value).  Short-term securities which mature after 60 days are valued at market.  To the extent the inputs are observable and timely, these securities would be classified in level 2 of the fair value hierarchy.
 
The Board of Trustees has delegated day-to-day valuation issues to a Valuation Committee of the Trust which is comprised of representatives from U.S. Bancorp Fund Services, LLC, the Fund’s administrator.  The function of the Valuation Committee is to value securities where current and reliable market quotations are not readily available or the closing price does not represent fair value by following procedures approved by the Board of Trustees.  These procedures consider many factors, including the type of security, size of holding, trading volume and news events.  All actions taken by the Valuation Committee are subsequently reviewed and ratified by the Board of Trustees.
 
Depending on the relative significance of the valuation inputs, fair valued securities may be classified in either level 2 or level 3 of the fair value hierarchy.
 
The inputs or methodology used for valuing securities are not an indication of the risk associated with investing in those securities.  The following is a summary of the inputs used to value the Funds’ securities as of November 30, 2013:
 
BBB Bond Fund
 
     
Level 1
   
Level 2
   
Level 3
   
Total
 
 
    Fixed Income
                       
 
       Corporate Bonds
  $     $ 223,536,137     $     $ 223,536,137  
 
       Sovereign Bonds
          30,190,379             30,190,379  
 
       U.S. Government
                               
 
         Instrumentalities
          4,325,113             4,325,113  
 
    Total Fixed Income
          258,051,629             258,051,629  
 
    Short-Term Investments
    7,166,759                   7,166,759  
 
    Total Investments
  $ 7,166,759     $ 258,051,629     $     $ 265,218,388  

 

 

 

 
30

 
PIA Funds
Notes to Financial Statements – November 30, 2013 (continued)
 
MBS Bond Fund
 
     
Level 1
   
Level 2
   
Level 3
   
Total
 
 
    Fixed Income
                       
 
       Commercial Mortgage-Backed Securities
  $     $ 797,465     $ 1,301,430     $ 2,098,895  
 
       Residential Mortgage-Backed Securities
          3,007,865             3,007,865  
 
       Mortgage-Backed Securities –
                               
 
         U.S. Government Agencies
          99,661,962             99,661,962  
 
       U.S. Government Instrumentalities
          6,501,651             6,501,651  
 
    Total Fixed Income
          109,968,943       1,301,430       111,270,373  
 
    Short-Term Investments
    256,428                   256,428  
 
    Total Investments
  $ 256,428     $ 109,968,943     $ 1,301,430     $ 111,526,801  
 
Refer to the Funds’ Schedule of Investments for a detailed break-out of securities.  Transfers between levels are recognized at November 30, 2013, the end of the reporting period.  The Funds recognized no transfers to/from level 1 or level 2. The BBB Bond Fund held no level 3 securities during the year ended November 30, 2013.
 
The following is a reconciliation of the MBS Bond Fund’s level 3 investments for which significant unobservable inputs were used in determining value.
     
Investments in Securities, at Value
 
     
Mortgage-Backed Securities
 
 
Balance as of November 30, 2012
  $  
 
Accrued discounts/premiums
     
 
Realized gain/(loss)
     
 
Change in unrealized appreciation/(depreciation)
    1,431  
 
Purchases
    1,299,999  
 
Sales
     
 
Transfers in and/or out of Level 3
     
 
Balance as of November 30, 2013
  $ 1,301,430  
 
The MBS Bond Fund’s primary pricing service was unable to provide pricing for one mortgage-backed security at November 30, 2013.  The Valuation Committee utilized an indicative market quotation or broker quote received from a broker-dealer considered by the Adviser to be a market participant.  The underlying inputs which support the broker quote utilized by the Valuation Committee are not observable.  Since the security’s fair value utilized significant unobservable inputs due to the lack of reliable market data, the security is categorized as level 3 of the fair value hierarchy.  Any significant change in the broker quote would have  a direct change on the fair value of the security.
 
New Accounting Pronouncement – In January 2013, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) No. 2013-01 Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities . This update gives additional clarification to the FASB ASU No. 2011-11 Disclosures about Offsetting Assets
 

 

 

 

 
31

 

PIA Funds
Notes to Financial Statements – November 30, 2013 (continued)

 
and Liabilities . The amendments in this ASU require an entity to disclose information about offsetting and related arrangements to enable users of its financial statements to understand the effect of those arrangements on its financial position. The ASU is effective for annual reporting periods beginning on or after January 1, 2013, and interim periods within those annual periods. The guidance requires retrospective application for all comparative periods presented. The Funds are currently evaluating the impact ASU 2013-01 will have on the financial statement disclosures.
 
Note 4 – Investment Advisory Fee and Other Transactions with Affiliates
The Funds have investment advisory agreements with Pacific Income Advisers, Inc. (“PIA” or the “Adviser”) pursuant to which the Adviser is responsible for providing investment management services to the Funds.  The Adviser furnished all investment advice, office space and facilities, and provides most of the personnel needed by the Funds.  Under the agreement, the Funds do not pay the Adviser an investment advisory fee.  However, investors in the Funds will be charged investment advisory fees by the Adviser and persons other than the Adviser.  Clients of PIA pay PIA an investment advisory fee to manage their assets, including assets invested in the Funds.  Participants in “wrap-fee” programs pay fees to the program sponsor, who in turn pays fees to the Adviser.
 
The Funds are responsible for their own operating expenses.  PIA has voluntarily agreed to limit the total expenses of the Funds to an annual rate of 0.00% of average daily net assets through March 29, 2014.  This waiver may be discontinued at any time after March 29, 2014 as long as the Adviser provides shareholders of the Funds with written notice six months in advance of the discontinuance.  The Adviser may not recoup expense reimbursements in future periods.  For the year ended November 30, 2013, the Adviser absorbed Fund expenses in the amount of $466,638 and $302,954 for the BBB Bond Fund and the MBS Bond Fund, respectively.
 
U.S. Bancorp Fund Services, LLC (the “Administrator”) acts as the Funds’ Administrator under an Administration Agreement.  The Administrator prepares various federal and state regulatory filings, reports and returns for the Funds; prepares reports and materials to be supplied to the Trustees; monitors the activities of the Funds’ custodian, transfer agent and accountants; coordinates the preparation and payment of the Funds’ expenses and reviews the Funds’ expense accruals.
 
U.S. Bancorp Fund Services, LLC (“USBFS”) also serves as the fund accountant and transfer agent to the Funds.  U.S. Bank N.A., an affiliate of USBFS, serves as the Funds’ custodian.
 
Quasar Distributors, LLC (the “Distributor”) acts as the Funds’ principal underwriter in a continuous public offering of the Funds’ shares.  The Distributor is an affiliate of the Administrator.
 
Certain officers of the Funds are employees of the Administrator.
 

 

 

 

 
32

 
PIA Funds
Notes to Financial Statements – November 30, 2013 (continued)

 
For the year ended November 30, 2013, the Funds incurred the following expenses for administration, fund accounting, transfer agency, custody, and Chief Compliance Officer fees:
 
    BBB Bond Fund   MBS Bond Fund  
Administration
    $  71,432       $47,989    
Fund Accounting
    109,986       82,431    
Transfer Agency
                 
  (excludes out-of-pocket expenses and sub-ta fees)
    108,041       43,792    
Custody
    27,040       32,725    
Chief Compliance Officer
    7,425       6,578    

 
At November 30, 2013, the Funds had payables due to USBFS for administration, fund accounting, transfer agency and Chief Compliance Officer fees and to U.S. Bank, N.A. for custody fees in the following amounts:
 
    BBB Bond Fund   MBS Bond Fund  
Administration
    $10,467       $  6,822    
Fund Accounting
    16,892       12,517    
Transfer Agency
                 
  (excludes out-of-pocket expenses and sub-ta fees)
    17,802       6,466    
Custody
    5,122       4,770    
Chief Compliance Officer
    1,238       994    

Note 5 – Purchases and Sales of Securities
 
Non-Government
Government
 
Purchases
Sales
Purchases
Sales
BBB Bond Fund
$133,100,408
$230,874,553
$17,111,482
$14,453,325
MBS Bond Fund
  381,482,780
  437,726,202

 
Purchases and sales of U.S. Government securities include only long-term purchases and sales of securities directly issued by the U.S. Government such as U.S. Treasury notes and bonds.
 
Note 6 – Line of Credit
The BBB Bond Fund has a line of credit in the amount of $18,400,000.  This line of credit is intended to provide short-term financing, if necessary, subject to certain restrictions, in connection with shareholder redemptions.  The credit facility is with the BBB Bond Fund’s custodian, U.S. Bank N.A.  During the year ended November 30, 2013, the Fund drew upon its line of credit.  The Fund had a one day outstanding balance of $5,242,000, a weighted average interest rate of 3.25%, and was charged interest expense of $473.  At November 30, 2013, the Fund had no outstanding loan amounts.
 

 

 

 

 
33

 
PIA Funds
Notes to Financial Statements – November 30, 2013 (continued)

 
Note 7 – Federal Income Tax Information
 
The tax character of distributions paid during the years ended November 30, 2013 and November 30, 2012 was as follows:
 
     
BBB Bond Fund
   
MBS Bond Fund
 
     
Nov. 30, 2013
   
Nov. 30, 2012
   
Nov. 30, 2013
   
Nov. 30, 2012
 
 
Ordinary income
  $ 13,671,544     $ 14,556,232     $ 4,558,441     $ 4,711,028  
 
Long-term capital gains
    10,028,726       14,474,369              
 
Ordinary income distributions may include dividends paid from short-term capital gains.
 
As of November 30, 2013, the components of capital on a tax basis were as follows:
 
     
BBB Bond Fund
   
MBS Bond Fund
 
 
Cost of investments (a)
  $ 266,215,863     $ 108,862,666  
 
Gross unrealized appreciation
    8,231,648       3,450,735  
 
Gross unrealized depreciation
    (9,229,123 )     (786,600 )
 
Net unrealized appreciation/(depreciation)
    (997,475 )     2,664,135  
 
Undistributed ordinary income
    150,448       179,488  
 
Undistributed long-term capital gain
    9,479,254        
 
Total distributable earnings
    9,629,702       179,488  
 
Other accumulated gains/(losses)
          (1,576,104 )
 
Total accumulated earnings/(losses)
  $ 8,632,227     $ 1,267,519  
 
 
(a)
The difference between book-basis and tax-basis net unrealized depreciation in the BBB Bond Fund is attributable primarily to wash sales.  The book-basis and tax-basis net unrealized appreciation is the same in the MBS Bond Fund.
 
At November 30, 2013, the MBS Bond Fund had post-October losses of $1,576,104.
 
Note 8 – Other Tax Information (Unaudited)
 
For the year ended November 30, 2013, none of the dividends paid from net investment income qualifies for the dividend received deduction available to corporate shareholders of the Funds.  For shareholders in the Funds, none of the dividend income distributed for the year ended November 30, 2013 is designated as qualified dividend income under the Jobs and Growth Relief Act of 2003.
 
The BBB Bond Fund and the MBS Bond Fund designated 2.95% and 28.13%, respectively, of its taxable ordinary income distributions as short-term capital gain distributions under Internal Revenue section 871(k)(2)(c).
 
On December 27, 2013, the BBB Bond Fund distributed $0.03675873 per share of net investment income and $0.33883 per share of long-term capital gains.  On December 27, 2013, the MBS Bond Fund distributed $0.04359256 per share of net investment income.
 




 
34

 
PIA Funds
Report of Independent Registered Public Accounting Firm

To the Board of Trustees
Advisors Series Trust and
Shareholders of:
PIA BBB Bond Fund
PIA MBS Bond Fund
 
We have audited the accompanying statements of assets and liabilities of PIA BBB Bond Fund and PIA MBS Bond Fund, each a series of Advisors Series Trust (the “Trust”), including the schedules of investments, as of  November 30, 2013, and the related statements of operations for the year then ended,  the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended.   These financial statements and financial highlights are the responsibility of the Trust’s management.  Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.
 
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement.  The Trust is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.  Our audits included 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 Trust’s internal control over financial reporting.  Accordingly, we express no such opinion.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.  Our procedures included confirmation of securities owned as of November 30, 2013, by correspondence with the custodian and brokers or by other appropriate auditing procedures where replies from brokers were not received.  We believe that our audits provide a reasonable basis for our opinion.
 
In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of PIA BBB Bond Fund and PIA MBS Bond Fund, as of November 30, 2013, the results of their operations, the changes in their net assets and the financial highlights for the periods indicated above, in conformity with accounting principles generally accepted in the United States of America.
 
 
TAIT, WELLER & BAKER LLP
Philadelphia, Pennsylvania
January 29, 2014
 




 
35

 
PIA Funds
Notice to Shareholders – November 30, 2013
(Unaudited)

How to Obtain a Copy of the Funds’ Proxy Voting Policies
A description of the policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available without charge, upon request, by calling 1-800-251-1970, or on the Securities and Exchange Commission’s (“SEC”) website at http://www.sec.gov.
 
How to Obtain a Copy of the Funds’ Proxy Voting Records for the 12-Month Period Ended June 30
Information regarding how the Funds voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available without charge, upon request, by calling 1-800-251-1970.  Furthermore, you can obtain the Funds’ proxy voting records on the SEC’s website at http://www.sec.gov.
 
Quarterly Filings on Form N-Q
The Funds file their complete schedules of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The Funds’ Form N-Q is available on the SEC’s website at http://www.sec.gov. The Funds’ Form N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC, and information on the operation of the Public Reference Room may be obtained by calling 1-202-551-8090.  Information included in the Funds’ Form N-Q is also available by calling 1-800-251-1970.
 
Householding
In an effort to decrease costs, the Funds intend to reduce the number of duplicate prospectuses, annual and semi-annual reports, proxy statements and other similar documents you receive by sending only one copy of each to those addresses shared by two or more accounts and to shareholders the Transfer Agent reasonably believes are from the same family or household.  Once implemented, if you would like to discontinue householding for your accounts, please call toll-free at 1-800-251-1970 to request individual copies of these documents.  Once the Transfer Agent receives notice to stop householding, the Transfer Agent will begin sending individual copies thirty days after receiving your request.  This policy does not apply to account statements.
 




 
36

 
PIA Funds
Information About Trustees and Officers
(Unaudited)

This chart provides information about the Trustees and Officers who oversee the Funds.  Officers elected by the Trustees manage the day-to-day operations of the Funds and execute policies formulated by the Trustees.
 
       
Number of
 
       
Portfolios in
Other
   
Term of Office
 
Fund Complex
Directorships
Name, Address
Position Held
and Length of
Principal Occupation
Overseen by
Held During
and Age
with the Trust
Time Served
During Past Five Years
Trustee (2)
Past Five Years
           
Independent Trustees (1)
         
           
Donald E. O’Connor
Trustee
Indefinite term
Retired; former Financial
6
Trustee,
(age 77)
 
since
Consultant and former Executive
 
Advisors
615 E. Michigan Street
 
February 1997.
Vice President and Chief
 
Series Trust
Milwaukee, WI 53202
   
Operating Officer of ICI Mutual
 
(for series not
     
Insurance Company
 
affiliated with
     
(until January 1997).
 
the Funds);
         
Trustee, The
         
Forward Funds
         
(31 portfolios).
           
George J. Rebhan
Trustee
Indefinite term
Retired; formerly President,
6
Trustee,
(age 79)
 
since
Hotchkis and Wiley Funds
 
Advisors
615 E. Michigan Street
 
May 2002.
(mutual funds) (1985 to 1993).
 
Series Trust
Milwaukee, WI 53202
       
(for series not
         
affiliated with
         
the Funds);
         
Independent
         
Trustee from
         
1999 to 2009,
         
E*TRADE
         
Funds.
           
George T. Wofford
Trustee
Indefinite term
Retired; formerly Senior Vice
6
Trustee,
(age 74)
 
since
President, Federal Home Loan
 
Advisors
615 E. Michigan Street
 
February 1997.
Bank of San Francisco.
 
Series Trust
Milwaukee, WI 53202
       
(for series not
         
affiliated with
         
the Funds).




 
37

 
PIA Funds
Information About Trustees and Officers (continued)
(Unaudited)

       
Number of
 
       
Portfolios in
Other
   
Term of Office
 
Fund Complex
Directorships
Name, Address
Position Held
and Length of
Principal Occupation
Overseen by
Held During
and Age
with the Trust
Time Served
During Past Five Years
Trustee (2)
Past Five Years
           
Interested Trustee
         
           
Joe D. Redwine (3)
Interested
Indefinite term
President, CEO, U.S. Bancorp
6
Trustee,
(age 66)
Trustee
since
Fund Services, LLC
 
Advisors
615 E. Michigan Street
 
September 2008.
(May 1991 to present).
 
Series Trust
Milwaukee, WI 53202
       
(for series not
         
affiliated with
         
the Funds).

   
Term of Office
 
Name, Address
Position Held
and Length of
Principal Occupation
and Age
with the Trust
Time Served
During Past Five Years
       
Officers
     
       
Joe D. Redwine
Chairman and
Indefinite term
President, CEO, U.S. Bancorp Fund Services, LLC
(age 66)
Chief Executive
since
(May 1991 to present).
615 E. Michigan Street
Officer
September 2007.
 
Milwaukee, WI 53202
     
       
Douglas G. Hess
President and
Indefinite term
Senior Vice President, Compliance and Administration,
(age 46)
Principal
since
U.S. Bancorp Fund Services, LLC (March 1997 to present).
615 E. Michigan Street
Executive
June 2003.
 
Milwaukee, WI 53202
Officer
   
       
Cheryl L. King
Treasurer and
Indefinite term
Vice President, Compliance and Administration,
(age 52)
Principal
since
U.S. Bancorp Fund Services, LLC (October 1998 to present).
615 E. Michigan Street
Financial
December 2007.
 
Milwaukee, WI 53202
Officer
   
       
Kevin J. Hayden
Assistant
Indefinite term
Assistant Vice President, Compliance and Administration,
(age 42)
Treasurer
since
U.S. Bancorp Fund Services, LLC (June 2005 to present).
615 E. Michigan Street
 
September 2013.
 
Milwaukee, WI 53202
     
       
Albert Sosa
Assistant
Indefinite term
Assistant Vice President, Compliance and Administration,
(age 43)
Treasurer
since
U.S. Bancorp Fund Services, LLC (June 2004 to present).
615 E. Michigan Street
 
September 2013.
 
Milwaukee, WI 53202
     




 
38

 
PIA Funds
Information About Trustees and Officers (continued)
(Unaudited)

   
Term of Office
 
Name, Address
Position Held
and Length of
Principal Occupation
and Age
with the Trust
Time Served
During Past Five Years
       
Michael L. Ceccato
Vice President,
Indefinite term
Senior Vice President, U.S. Bancorp Fund Services, LLC
(age 56)
Chief
since
(February 2008 to present); General Counsel/Controller,
615 E. Michigan Street
Compliance
September 2009.
Steinhafels, Inc. (September 1995 to February 2008).
Milwaukee, WI 53202
Officer and
   
 
AML Officer
   
       
Jeanine M. Bajczyk, Esq.
Secretary
Indefinite term
Senior Vice President and Counsel,
(age 48)
 
since
U.S. Bancorp Fund Services, LLC (May 2006 to present).
615 E. Michigan Street
 
June 2007.
 
Milwaukee, WI 53202
     

(1)
The Trustees of the Trust who are not “interested persons” of the Trust as defined under the 1940 Act (“Independent Trustees”).
(2)
As of November 30, 2013, the Trust is comprised of 40 active portfolios managed by unaffiliated investment advisors.  The term “Fund Complex” applies only to the Funds and the PIA High Yield Fund, the PIA High Yield (MACS) Fund, the PIA Short-Term Duration Bond Fund and the PIA Short-Term Securities Fund.  The Funds do not hold themselves out as related to any other series within the Trust for investment purposes, nor does it share the same investment adviser with any other series.
(3)
Mr. Redwine is an “interested person” of the Trust as defined by the 1940 Act.  Mr. Redwine is an interested Trustee of the Trust by virtue of the fact that he is an interested person of Quasar Distributors, LLC who acts as principal underwriter to the series of the Trust.
 
The Statement of Additional Information includes additional information about the Funds’ Trustees and Officers and is available, without charge, upon request by calling 1-800-251-1970.
 




 
39

 
PRIVACY NOTICE

The Funds collect non-public information about you from the following sources:
 
•  Information we receive about you on applications or other forms;
 
•  Information you give us orally; and/or
 
•  Information about your transactions with us or others.
 
We do not disclose any non-public personal information about our customers or former customers without the customer’s authorization, except as permitted by law or in response to inquiries from governmental authorities. We may share information with affiliated and unaffiliated third parties with whom we have contracts for servicing the Funds.  We will provide unaffiliated third parties with only the information necessary to carry out their assigned responsibilities.  We maintain physical, electronic and procedural safeguards to guard your non-public personal information and require third parties to treat your personal information with the same high degree of confidentiality.
 
In the event that you hold shares of the Funds through a financial intermediary, including, but not limited to, a broker-dealer, bank, or trust company, the privacy policy of your financial intermediary would govern how your non-public personal information would be shared by those entities with unaffiliated third parties.
 

 
 

 

 
 

 


(This Page Intentionally Left Blank.)
 

 

 

 

 
 

 

Adviser
Pacific Income Advisers, Inc.
1299 Ocean Avenue, Suite 210
Santa Monica, CA  90401


Distributor
Quasar Distributors, LLC
615 East Michigan Street
Milwaukee, WI   53202


Transfer Agent
U.S. Bancorp Fund Services, LLC
615 East Michigan Street
Milwaukee, WI  53202
(800) 251-1970


Custodian
U.S. Bank N.A.
1555 North River Center Drive, Suite 302
Milwaukee, WI  53212


Independent Registered Public Accounting Firm
Tait, Weller & Baker LLP
1818 Market Street, Suite 2400
Philadelphia, PA  19103


Legal Counsel
Paul Hastings LLP
75 East 55th Street
New York, NY  10022







Past performance results shown in this report should not be considered a representation of future performance.  Share price and returns will fluctuate so that shares, when redeemed, may be worth more or less than their original cost.  Statements and other information herein are dated and are subject to change.
 


 
 

 
Item 2. Code of Ethics.

The registrant has adopted a code of ethics that applies to the registrant’s principal executive officer and principal financial officer.  The registrant has not made any amendments to its code of ethics during the period covered by this report.  The registrant has not granted any waivers from any provisions of the code of ethics during the period covered by this report.

A copy of the registrant’s Code of Ethics is filed herewith.

Item 3. Audit Committee Financial Expert.

The Registrant’s Board of Trustees has determined that it does not have an audit committee financial expert serving on its audit committee.  At this time, the Registrant believes that the business experience and financial literacy provided by each member of the audit committee collectively offers the Registrant adequate oversight given the Registrant’s level of financial complexity.

Item 4. Principal Accountant Fees and Services.

The registrant has engaged its principal accountant to perform audit services, audit-related services, tax services and other services during the past two fiscal years.  “Audit services” refer to performing an audit of the registrant's annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years.  “Audit-related services” refer to the assurance and related services by the principal accountant that are reasonably related to the performance of the audit.  “Tax services” refer to professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning.  There were no “other services” provided by the principal accountant.  The following table details the aggregate fees billed or expected to be billed for each of the last two fiscal years for audit fees, audit-related fees, tax fees and other fees by the principal accountant.

 
FYE  11/30/2013
FYE  11/30/2012
Audit Fees
          $59,600
          $72,500
Audit-Related Fees
          N/A
          N/A
Tax Fees
          $12,400
          $15,000
All Other Fees
          N/A
          N/A

The audit committee has adopted pre-approval policies and procedures that require the audit committee to pre-approve all audit and non-audit services of the registrant, including services provided to any entity affiliated with the registrant.

The percentage of fees billed by Tait, Weller, & Baker LLP applicable to non-audit services pursuant to waiver of pre-approval requirement were as follows:

 
FYE  11/30/2013
FYE  11/30/2012
Audit-Related Fees
0%
0%
Tax Fees
0%
0%
All Other Fees
0%
0%

All of the principal accountant’s hours spent on auditing the registrant’s financial statements were attributed to work performed by full-time permanent employees of the principal accountant.

The following table indicates the non-audit fees billed   or expected to be billed by the registrant’s accountant for services to the registrant and to the registrant’s investment adviser (and any other controlling entity, etc.—not sub-adviser) for the last two years.  The audit committee of the Board of Trustees has considered whether the provision of non-audit services that were rendered to the registrant's investment adviser is compatible with maintaining the principal accountant's independence and has concluded that the provision of such non-audit services by the accountant has not compromised the accountant’s independence.

Non-Audit Related Fees
FYE  11/30/2013
FYE  11/30/2012
Registrant
N/A
N/A
Registrant’s Investment Adviser
N/A
N/A

Item 5. Audit Committee of Listed Registrants.

Not applicable to registrants who are not listed issuers (as defined in Rule 10A-3 under the Securities Exchange Act of 1934).

Item 6. Investments.

(a)  
Schedule of Investments is included as part of the report to shareholders filed under Item 1 of this Form.
 
(b) Not Applicable.

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

Not applicable to open-end investment companies.

Item 8. Portfolio Managers of Closed-End Management Investment Companies.

Not applicable to open-end investment companies.

Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.

Not applicable to open-end investment companies.

Item 10. Submission of Matters to a Vote of Security Holders.

There have been no material changes to the procedures by which shareholders may recommend nominees to the Registrant’s Board of Trustees.

Item 11. Controls and Procedures.

(a)  
The Registrant’s President/Principal Executive Officer and Treasurer/Principal Financial Officer have reviewed the Registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the “Act”)) as of a date within 90 days of the filing of this report, as required by Rule 30a-3(b) under the Act and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934.  Based on their review, such officers have concluded that the disclosure controls and procedures are effective in ensuring that information required to be disclosed in this report is appropriately recorded, processed, summarized and reported and made known to them by others within the Registrant and by the Registrant’s service provider.

(b)  
There were no changes in the Registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the fourth fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting.

Item 12. Exhibits.

(a)  
(1) Any code of ethics or amendment thereto, that is subject of the disclosure required by Item 2, to the extent that the registrant intends to satisfy Item 2 requirements through filing an exhibit. Filed herewith.

(2) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.   Filed herewith.

(3) Any written solicitation to purchase securities under Rule 23c-1 under the Act sent or given during the period covered by the report by or on behalf of the registrant to 10 or more persons.   Not applicable to open-end investment companies.

(b)  
Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.   Furnished herewith.

 
 

 
SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


(Registrant)   Advisors Series Trust                                                                                                 

By (Signature and Title)*                    /s/ Douglas G. Hess                                                                                                           
Douglas G. Hess, President

Date     2/4/14                                                                                                 



Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By (Signature and Title)*                     /s/ Douglas G. Hess                                                                                                            
Douglas G. Hess, President

Date     2 /4/14                                                                                                 

By (Signature and Title)*                    / s/ Cheryl L. King                                                                                     
Cheryl L. King, Treasurer

Date     2/4/14                                                                                      

* Print the name and title of each signing officer under his or her signature.
 
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