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Form N-CSRS BULLFINCH FUND INC For: Apr 30

June 29, 2022 2:14 PM EDT

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

 

 

FORM N-CSRS

 

 

 

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES

 

Investment Company Act file number 811-08191

 

Name of Fund: Bullfinch Fund, Inc.
   
Fund Address: 3909 Rush Mendon Road
  Mendon, New York 14506
   
Name and address of agent for service: Christopher Carosa, President,
  Bullfinch Fund, Inc., 3909 Rush Mendon Road,
  Mendon, New York 14506
  Mailing address: 3909 Rush Mendon Road
  Mendon, New York 14506
   
Registrant’s telephone number, including area code: (585) 624-3650
   
Date of fiscal year end: 10/31/22
   
Date of reporting period: 11/01/21 - 4/30/22

 

 

 

 
 

 

Item 2 - CODE OF ETHICS.

 

  (a)

The registrant has adopted a code of ethics that applies to the registrant’s principal executive officer, its principal financial officer, principal accounting officer, controller, as well as any other officers and persons providing similar functions. This code of ethics is included as Exhibit 11(a)(1).

     
  (b) During the period covered by this report, no amendments were made to the provisions of the code of ethics
     
  (c) During the period covered by this report, no implicit or explicit waivers to the provisions of the code of ethics were granted.

 

Item 3 - AUDIT COMMITTEE FINANCIAL EXPERT.

 

The registrant’s Board of Directors determined that the registrant does not have an Audit Committee member who possesses all of the attributes required to be an “audit committee financial expert” as defined in instruction 2(b) of Item 3 of Form N-CSR. It was the consensus of the board that, although no one individual Audit Committee member meets the technical definition of an audit committee financial expert, the Committee has sufficient expertise collectively among its members to effectively discharge its duties and that the Committee will engage additional expertise if needed.

 

Item 4 - PRINCIPAL ACCOUNTANT FEES AND SERVICES.

 

The registrant has engaged its principal accountant to perform audit services. “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. The following table details the aggregate fees billed for each of the last two fiscal years for audit fees, audit-related fees, tax fees and other fees by the principal accountant. Since the accounting fees were approved by the Board of Directors in total, the principal accountant has provided an estimate of the split between audit and preparation of the tax filings.

 

   10/31/2021   10/31/2020 
         
Audit Fees  $14,950   $14,100 
           
Audit-Related Fees  $0   $0 
Tax Fees  $2,100   $2,000 
All Other Fees  $0   $0 

 

The Audit Committee of the registrant’s Board of Directors recommends a principal accountant to perform audit services for the registrant. Each year, the registrant’s Board of Directors vote to approve or disapprove the principal accountant recommended by the Audit Committee for the following year’s accounting work.

 

Item 5 - AUDIT COMMITTEE OF LISTED REGISTRANTS.

 

Not applicable to open-end investment companies.

 

Item 6 - INVESTMENTS

 

Item 6(a) -The list of investments is included in the shareholder report.

 

Item 6(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 COMPANIES.

 

Not applicable to open-end investment companies.

 

ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

 

None.

 

ITEM 11. CONTROLS AND PROCEDURES.

 

Item 11(a) - The registrant’s principal executive and principal financial officer has determined that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) are effective based on the evaluation of these controls and procedures are effective as of a date within 90 days prior to the filing date of this report.

 

Item 11(b) - There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the registrant’s last fiscal half-year (the registrant’s second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

 

Item 12 - DISCLOSURE OF SECURITIES LENDING ACTIVITIES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

 

  (a) Not applicable.
  (b) Not applicable.

 

Item 13 - EXHIBITS.

 

  (a)(1)

Code of Ethics - (incorporated by reference to Bullfinch Fund, Inc.; 333-26321; 811-08191; Form N-1A filed on October 30, 2003 with Accession Number 0001038199-02-000005).

     
  (a)(2) Certifications pursuant to Section 302 of the Sarbanes- Oxley Act of 2002 are attached hereto.
     
  (b) Certifications pursuant to Section 906 of the Sarbanes- Oxley Act of 2002 are attached hereto.

 

 
 

 

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.

 

Bullfinch Fund, Inc.  
     
By: /s/ Christopher Carosa  
  Christopher Carosa,  
  President of Bullfinch Fund, Inc.  

 

Date: June 29, 2022

 

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

 

By: /s/ Christopher Carosa  
  Christopher Carosa,  
  President of Bullfinch Fund, Inc.  

 

Date: June 29, 2022

 

 
 

 

Bullfinch Fund, Inc.

 

3909 Rush Mendon Road

Mendon, New York 14506

 

(585) 624-3150

1-888-BULLFINCH

(1-888-285-5346)

 

Unrestricted Series

 

Greater Western New York Series

 

Semi-Annual Report

April 30, 2022

(Unaudited)

 

1
 

 

Management’s Discussion of Fund Performance

 

June 27, 2022

Dear Fellow Shareholders:

 

We are very proud to present the April 2022 Semi-Annual Report of Bullfinch Fund, Inc. This report contains the unaudited financial statements for both the Unrestricted Series and the Greater Western New York Series.

 

Two words describe the first quarter and they both begin with the letter “I.” Inflation soared to unprecedented heights and while the Russian invasion into Ukraine may have exasperated the situation, we have been teetering on runaway inflation for some time now.

 

Anyone who has bought gas over the last year knows that rising energy prices have been the root cause of inflation. Logistical log jams are generally temporary in nature. Public policies that fail to address obvious fluctuations in oil prices can lead to (and seems to have led to) sustained, longer term inflation. Add to this public policies that continue to encourage spending (not productivity) and you have continued demand-push inflation with short supply inventories.

 

We can forgive the initial public policy push as it was thought Covid would unnaturally slow the economy and increased government spending would be needed to prevent an economic crash. It turned out the Covid rebound happened much quicker than anyone expected. In a sense, this exasperated the inflation problem when demand returned before the supply chains were fully back in operation.

 

In terms of individual stock performance for the past six months, the Unrestricted Series was led by Reliance Steel & Aluminum Co., Meridian Bioscience, Inc., AAR Corporation, and Bristol-Myers Squibb Co., all up 30% or more. Of the stocks held for the full reporting period, Adobe, Inc., General Electric Co., and Amazon.com Inc., fell the most (by 26% or more).

 

In the Greater Western New York Series, Astronics Corp., Manning & Napier Inc, and Bristol-Myers Squibb Co., led the way, each up by more than 30%. On the downside, two stocks held the entire period (Graham Corp. and Gibraltar Industries, Inc.), fell by more than 41%.

 

The last six months have been a challenge for the market as a whole as the economy of the country has floundered for a variety of reasons. Fortunately, our defensive posture has cushioned our portfolios on the downside. As the prospects of a recession grow, we don’t anticipate a change in this strategy in the near-term.

 

We wish to thank our shareholders for expressing their confidence in us and wish you continued good fortune.

 

Best Regards,

Bullfinch Fund, Inc.

 

Christopher Carosa, CTFA

President

 

2
 

 

BULLFINCH FUND INC.

PERFORMANCE SUMMARY

 

The graph below represents the changes in value for an initial $10,000 investment in the BULLFINCH Fund from 11/1/11 to 4/30/22. These changes are then compared to a $10,000 investment in the Value Line Geometric Index. The Value LINE Geometric Index (VLG) is an unmanaged index of between 1,600 and 1,700 stocks. Value Line states “The VLG was intended to provide a rough approximation of how the median stock in the Value Line Universe performed. The VLG also has appeal to institutional investors as a proxy for the so-called ‘multi-cap’ market because it includes large cap, mid cap and small cap stocks alike.” The Fund feels it is an appropriate benchmark because the Fund’s portfolios are multi-cap portfolios. The Fund’s returns include the reinvestment of all dividends, but do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemptions of fund shares. Past performance is not predictive of future performance. Investment return and principal value will fluctuate, so that your shares, when redeemed, may be worth more or less than the original cost.

 

Bullfinch Fund Inc.     Value Line   Bullfinch Fund Inc.     Value Line
Unrestricted Series (Solid) vs. Geometric Index (Dashed)   Greater WNY Series (Solid) vs. Geometric Index (Dashed)
     
 
Year ending 10/11 10/12 10/14 10/16 10/17 10/18 10/19 10/20 10/21 4/22   Year ending 10/11 10/12 10/14 10/16 10/17 10/18 10/19 10/20 10/21 4/22

 

Annualized          Annualized        
Returns Ending  Bullfinch Fund Inc.   Value Line   Returns Ending  Bullfinch Fund Inc.   Value Line 
4/30/2022  Unrestricted Series   Geometric Index   4/30/2022  Greater WNY Series   Geometric Index 
                        
One – Year   -0.85%   -11.63%  One – Year   -4.99%   -11.63%
Five – Year   +6.36%   +2.22%  Five – Year   +4.73%   +2.22%
Ten – Year   +8.85%   +4.66%  Ten – Year   +7.05%   +4.66%

 

3
 

 

UNRESTRICTED SERIES

(A Series Within Bullfinch Fund, Inc.)

 

FINANCIAL STATEMENTS AS OF

April 30, 2022

(UNAUDITED)

 

4
 

 

UNRESTRICTED SERIES
(A SERIES WITHIN BULLFINCH FUND, INC.)
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 2022 (UNAUDITED)

 

ASSETS     
      
Investments in Securities, at Fair Value, Identified Cost of $4,480,721  $8,878,226 
      
Cash and Cash Equivalents   2,900,990 
      
Accrued Interest and Dividends   14,911 
      
Prepaid Expenses    4,498 
      
Total Assets  $11,798,625 
      
LIABILITIES AND NET ASSETS     
      
LIABILITIES     
      
Accrued Expenses  $7,944 
      
Due to Investment Adviser    10,244 
      
NET ASSETS     
      
Net Assets (Equivalent to $ 24.43 per share based on 482,124.078 shares of stock outstanding)   11,780,437 
      
Total Liabilities and Net Assets  $11,798,625 
      
COMPOSITION OF NET ASSETS     
      
Shares of Common Stock - Par Value $.01; 482,124.078 Shares Outstanding  $7,011,430 
      
Accumulated Net Investment Gain & Realized Gain from Securities Transactions   371,502
Net Unrealized Appreciation on Investments   4,397,505 
      
Net Assets at April 30, 2022  $11,780,437 

 

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

 

5
 

 

UNRESTRICTED SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)
SCHEDULE OF INVESTMENTS IN SECURITIES
APRIL 30, 2022 (UNAUDITED)

 

             
       Historical   Fair 
   Shares   Cost   Value 
             
Level 1 – Common Stocks – 75.37%               
                
* ASTERISK DENOTES A NON INCOME PRODUCING SECURITY               
                
Computers – Software – 12.31%
               
Adobe Inc.*   1,100    28,660    435,545 
Microsoft Corp.   2,200    50,534    610,544 
Oracle Corp.   5,500    56,122    403,700 
         135,316    1,449,789 
                
Medical Products and Supplies – 11.44%               
Bristol-Myers Squibb Co.   7,100    359,371    534,417 
Edwards Lifesciences*   3,300    52,806    349,074 
Johnson & Johnson   2,400    136,714    433,104 
Medtronic PLC   300    22,701    31,308 
         571,592    1,347,903 
                
Commercial Services – 5.11%               
Paychex, Inc.   4,750    130,495    601,967 
                
Electrical Equipment – 4.71%               
Corning Inc.   7,300    66,773    256,887 
General Electric Co.   4,000    617,355    298,200 
         684,128    555,087 
                
Computers - Networking - 4.45%               
Cisco Systems, Inc.   10,700    160,238    524,086 
                
Building & Related – 4.10%               
Meritage Homes Corp.*   5,850    246,488    482,917 
                
Steel - 4.04%               
Reliance Steel & Aluminum Co.   2,400    184,673    475,800 
                
Retail – Specialty – 3.98%               
CVS Health Corp.   3,050    170,752    293,196 
Zumiez Inc.*   4,800    105,530    175,824 
         276,282    469,020 
                
Tobacco Products – 3.66%               
Universal Corp.   7,450    297,131    430,983 
                
Insurance - 3.50%               
Arthur J Gallagher & Co.   2,450    56,880    412,800 

 

       Historical    Fair 
   Shares   Cost   Value 
             
Level 1 – Common Stocks – 75.37%               
                
Biotech – 3.00%               
Meridian Bioscience, Inc.*   13,800    249,015    353,142 
                
Semiconductors - 2.98%               
Intel Corporation   5,000    85,564    217,950 
Xperi Holding Corp.   8,550    198,390    133,380 
         283,954    351,330 
                
Utilities – Natural Resources - 2.17%               
Consolidated Water Co. Ltd.   23,500    276,520    255,680 
                
Telecommunications – 2.16%               
AT&T Inc.   4,400    120,646    82,984 
Verizon Communications   3,700    180,520    171,310 
         301,166    254,294 
                
Retail - General – 1.84%               
Amazon.com Inc. *   87    159,645    216,250 
                
Computers – Hardware - 1.80%               
Western Digital Corp.*   4,000    187,535    212,280 
                
Aerospace – 1.76%               
AAR Corporation*   4,400    83,191    206,712 
                
Industrial Services – 1.60%               
Expeditors Int’l Washington   1,900    61,567    188,233 
                
Pharmaceuticals – 0.47%               
Viatris Inc.   5,350    83,781    55,266 
                
Media – 0.16%               
Warner Brothers Discovery*   1,064    37,776    19,312 
                
Railroads – 0.13%               
Wabtec Corporation   171    13,348    15,375 
                
Total Investments in Common Stocks        4,480,721    8,878,226 
                
Level 1 – Cash & Equivalents - 24.63%               
                
Schwab Bank - 24.63% Bank Sweep Interest Rate 0.01%        2,900,990    2,900,990 
                
Total Invested Assets       $7,381,711   $11,779,216 

 

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

 

6
 

 

UNRESTRICTED SERIES
(A SERIES WITHIN BULLFINCH FUND, INC.)
SCHEDULE OF INVESTMENTS IN SECURITIES
APRIL 30, 2022 (UNAUDITED)

 

Table of Industries

 

Industry  Fair Value   Percent 
         
Aerospace  $206,712    1.76%
Biotech  $353,142    3.00%
Building & Related  $482,917    4.10%
Commercial Services  $601,967    5.11%
Computers – Hardware  $212,280    1.80%
Computers – Networking  $524,086    4.45%
Computers – Software  $1,449,789    12.31%
Electrical Equipment  $555,087    4.71%
Industrial Services  $188,233    1.60%
Insurance  $412,800    3.50%
Media  $19,312    0.16%
Medical Products & Supplies  $1,347,903    11.44%
Pharmaceuticals  $55,266    0.47%
Railroads  $15,375    0.13%
Retail – General  $216,250    1.84%
Retail – Specialty  $469,020    3.98%
Semiconductors  $351,330    2.98%
Steel  $475,800    4.04%
Telecommunications  $254,294    2.16%
Tobacco Products  $430,983    3.66%
Utilities – Natural Resources  $255,680    2.17%
Total Equities  $8,878,226    75.37%
           
Cash & Equivalents  $2,900,990    24.63%
(Bank Sweep Interest Rate 0.01%)          
           
Total Invested Assets  $11,779,216    100.00%

 

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

 

7
 

 

UNRESTRICTED SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)
STATEMENTS OF OPERATIONS
FOR THE 6 MONTHS ENDED APRIL 30, 2022 (UNAUDITED)

 

INVESTMENT INCOME:    
Dividend & Interest Income  $76,866 
FEES AND EXPENSES:     
Investment Adviser Fees   62,555 
Legal and Professional   9,443 
D&O/E&O   4,186 
Custodian Fees   3,375 
Dues and Subscriptions   2,024 
Director’s Fees   1,200 
Registration Fees   150 
Maryland Taxes   150 
Telephone   40 
New York State Taxes   25 
Licenses & Permits   25 
Total expense   83,173 
Net investment loss   (6,307)
      
REALIZED AND UNREALIZED LOSS ON INVESTMENTS:     
Realized gain from securities transactions   939,143 
Change in unrealized appreciation (depreciation)   (1,616,768)
Net loss on investments   (677,625)
CHANGE IN NET ASSETS FROM OPERATIONS  $(683,932)

 

UNRESTRICTED SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)
STATEMENTS OF CHANGES IN NET ASSETS

 

    Six Months Ended    Year Ended 
   April 30,   October 31, 
    2022*   2021 
CHANGE IN NET ASSETS FROM OPERATIONS:          
Net investment income (loss)  $(6,307)  $(2,695)
Net realized income (loss) from securities transactions   939,143    (106,683)
Net change in unrealized appreciation (depreciation) of investments   (1,616,768)   3,112,897 
Increase (decrease) in net assets from operations   (683,932)   3,003,519 
           
DISTRIBUTIONS TO SHAREHOLDERS:          
Distribution of capital gains   0    (629)
Distribution of ordinary income   0    (22,165)
Decrease in net assets from distributions to shareholders   0    (22,794)
           
CAPITAL SHARE TRANSACTIONS:          
Shares Sold   45,327    107,193 
Reinvestment of distributions to shareholders   0    22,794 
Shares Redeemed   (7,150)   (685,365)
Increase (decrease) in net assets from capital share transactions   38,177    (555,378)
TOTAL INCREASE (DECREASE) IN NET ASSETS   (645,755)   2,425,347 
           
NET ASSETS:          
Beginning of period   12,426,192    10,000,845 
End of period  $11,780,437   $12.426,192 

 

*Unaudited

 

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

 

8
 

 

UNRESTRICTED SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)
FINANCIAL HIGHLIGHTS
(PER SHARE DATA FOR A SHARE OUTSTANDING)

 

   Six Months Ended   Year Ended   Year Ended   Year Ended   Year Ended   Year Ended 
   April 30,   October 31,   October 31,   October 31,   October 31,   October 31, 
   2022*   2021   2020   2019   2018   2017 
                         
NET ASSET VALUE, beginning of period  $      25.85   $19.88   $21.20   $19.59   $             20.78   $            20.29 
                               
INCOME FROM INVESTMENT OPERATIONS                              
Net investment income (loss)   (0.01)   (0.01)   0.04    0.12    0.11    0.05 
Net gain (loss) on securities both realized and unrealized   (1.41)   6.03    (1.24)   2.46    0.02    2.07 
Total from investment operations   (1.42)   6.02    (1.20)   2.58    0.13    2.12 
                               
DISTRIBUTIONS TO SHAREHOLDERS FROM:                              
Distribution of ordinary income   0.00    (0.04)   (0.12)   (0.10)   (0.05)   (0.03)
Distribution of capital gains   0.00    (0.01)   0.00    (0.87)   (1.27)   (1.60)
Total Stock Dividend Distributions   0.00    (0.05)   (0.12)   (0.97)   (1.32)   (1.63)
                               
NET ASSET VALUE, end of period  $24.43   $25.85   $19.88   $21.20   $19.59   $20.78 
                               
NET ASSETS**, end of period  $11,780,437   $12,426,192   $10,000,845   $10,414,616   $9,129,793   $8,857,939 

 

*Unaudited

**Rounded

 

UNRESTRICTED SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)
FINANCIAL HIGHLIGHTS
(RATIOS AND SUPPLEMENTAL DATA)

 

   Six Months Ended   Year Ended   Year Ended   Year Ended   Year Ended   Year Ended 
   April 30,   October 31,   October 31,   October 31,   October 31,   October 31, 
   2022*   2021   2020   2019   2018   2017 
                         
RATIO OF EXPENSES TO AVERAGE                              
NET ASSETS**   0.68%***   1.37%   1.43%   1.50%   1.49%   1.51%
                               
RATIO OF NET INVESTMENT INCOME TO                              
AVERAGE NET ASSETS**   (0.05)%***   (0.02)%   0.22%   0.61%   0.53%   0.24%
                               
PORTFOLIO TURNOVER RATE**   0.00%***   0.71%   5.94%   16.04%   11.41%   10.72%
                               
TOTAL RETURN   (5.49)%   30.34%   (5.71)%   14.23%   0.45%   10.92%

 

*Unaudited

**Per share amounts calculated using the average shares method

***The ratios presented were calculated using operating data for the six-month period from November 1, 2021 to April 30, 2022.

 

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

 

9
 

 

UNRESTRICTED SERIES
(A SERIES WITHIN BULLFINCH FUND, INC.)

NOTES TO FINANCIAL STATEMENTS

APRIL 30, 2022 (UNAUDITED)

 

NOTE A - SCOPE OF BUSINESS

 

The Unrestricted Series (the “Series”) is a series within the Bullfinch Fund, Inc. (the “Fund”), which was organized as a Maryland corporation registered under the Investment Company Act of 1940 as an open-ended non-diversified management investment company. The Fund offers two series of common stock. In addition to the Unrestricted Series, the Fund also offers the Greater Western New York Series.

 

The investment objective of the Series is to seek conservative long-term growth in capital. The Adviser seeks to achieve this objective by using an asset mix consisting primarily of exchange listed securities and over-the-counter common stocks as well as U.S. Government securities maturing within five years.

 

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

The following is a summary of significant accounting policies followed by the Series in the preparation of its financial statements. These policies are in conformity with accounting principles generally accepted in the United States (“GAAP”). The Series follows the investment company accounting and reporting guidance of the Financial Accounting Standard Board Accounting Standard Codification 946, Financial Services – Investment Companies.

 

Fair Value Measurements – ASC 820-10 establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value:

 

Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

 

Level 2: Other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

 

Level 3: Unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

 

The following is a description of the valuation methodologies used for assets measured at fair value:

 

Cash & Equivalents- Cash consists of amounts deposited in a bank sweept account and is federally insured. The Series has not experienced any losses on such amounts and believes it is not exposed to any significant credit risk on cash.

 

Security Valuation - The Series records its investments at fair value and is in compliance with FASB ASC 820-10-50. Securities traded on national securities exchanges or the NASDAQ National Market System are valued daily at the closing prices of the securities on those exchanges and securities traded on over-the-counter markets are valued daily at the closing bid prices. Short-term and money market securities are valued at amortized cost, which approximates market value.

 

10
 

 

ASSETS AT FAIR VALUE AS OF:

 

   4/30/22 
   LEVEL 1 
COMMON STOCKS  $8,878,226 
CASH & EQUIVALENTS  $2,900,990 
TOTALS BY LEVEL  $11,779,216 

 

In cases where market prices are unreliable or not readily available, for example, when trading on securities are halted as permitted by the SEC or when there is no trading volume on an Over-the-Counter security held by the Fund, the Fund relies on fair value pricing provided by the Adviser. In performing its fair value pricing, the Adviser acts under the ultimate supervision of, and follows, the policies of the Board of Directors. The Board of Directors retains the right to determine its own fair value price should it have reason to believe the price provided by the Adviser does not reflect fair value. Valuing securities at fair value involves greater reliance on judgment than securities that have readily available market quotations. There can be no assurance the Fund could obtain the fair value assigned to a security if they were to sell the security at approximately the time at which the Fund determines their net asset value per share.

 

Series Allocations - Common expenses of the Fund are evenly split between the two series of the Fund unless the Board of Directors approves an alternative allocation of expenses based on management’s estimate.

 

Income Taxes - It is the policy of the Fund to comply with the requirements of Subchapter M of the Internal Revenue Code (the “Code”) applicable to regulated investment companies and to distribute all of its taxable income to its shareholders. In addition, the Fund intends to distribute an amount sufficient to avoid imposition of any excise tax under Section 4982 of the Code. Therefore, no provision for federal income taxes or excise taxes has been made.

 

Management has reviewed all open tax years and major tax jurisdictions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions taken on returns filed or expected to be taken on a tax return. The Series’tax returns are open for examination by the relevant tax authorities until expiration of the applicable statute of limitation which is generally three years after the filing of the tax return.

 

Distributions to Shareholders - Distributions to shareholders are recorded on the ex-dividend date. The Series made a distribution of its ordinary income of $22,165 to its shareholders on December 28, 2020, in the form of stock dividends equal to 986.224 shares of stock. The Series made a distribution of its short term capital gains of $629 to its shareholders on December 28, 2020, in the form of stock dividends equal to 27.978 shares of stock.

 

Other - The Series follows industry practice and records security transactions on the trade date. The specific identification method is used for determining gains and losses for financial statement and income tax purposes. Dividend income is recorded on the ex-dividend date. Non –cash dividends received in the form of stock, if any, are recorded as dividend income at fair value. Distributions received by the Series may include a return of capital that is estimated by management. Such amounts are recorded as reduction of the cost of investments or reclassified to capital gains.

 

Use of Estimates - The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results can differ from those estimates.

 

Subsequent Events - In accordance with GAAP, the Fund has evaluated the need for disclosures and/or adjustments resulting from subsequent events through the date of issuance of these financial statements.

 

11
 

 

NOTE C – INVESTMENTS

 

For the six months ended April 30, 2022, the Series purchased $0 of common stock. During the same period, the Series redeemed $1,076,040 of common stock. The Series also redeemed $1,300,000 in Treasury Bills.

 

At April 30, 2022, the gross unrealized appreciation for all securities totaled $4,896,361 and the gross unrealized depreciation for all securities totaled 498,856 or a net unrealized appreciation of $4,397,505. The aggregate cost of securities for federal income tax purposes at April 30, 2022 was $4,480,721.

 

NOTE D – RELATED PARTY TRANSACTIONS

 

Carosa Stanton Asset Management, LLC serves as investment adviser to the Fund pursuant to an investment adviser agreement which was approved by the Fund’s board of directors. Carosa Stanton Asset Management, LLC is a Registered Investment Adviser under the Investment Advisers Act of 1940. The Investment adviser agreement provides that Carosa Stanton Asset Management, LLC, subject to the supervision and approval of the Fund’s board of directors, is responsible for the day-to-day management of the Fund’s portfolio, which includes selecting investments and handling its business affairs.

 

As compensation for its services to the Fund, the investment adviser receives monthly compensation at an annual rate of 1.25% on the first $1 million of daily average net assets and 1% on that portion of the daily average net assets in excess of $1 million. These fees are reduced by any sub-transfer agent fees incurred by the Fund.

 

Carosa Stanton Asset Management, LLC has agreed as part of its contract to forego sufficient investment adviser fees to limit total expenses of the Fund to 2% of the first $10 million in average assets and 1.5% of the next $20 million in average assets.

 

During the six months ended April 30, 2022, the Fund paid investment adviser fees of $62,555.

 

As of April 30, 2022, the Fund had $10,244 included in liabilities, as owed to Carosa Stanton Asset Management, LLC.

 

Certain officers of the Fund are also officers of Carosa Stanton Asset Management.

 

NOTE E – REMUNERATION OF DIRECTORS

 

The Directors are paid a fee of $50 per quarter. They may be reimbursed for travel expenses.

 

NOTE F – COMMITMENTS AND CONTINGENCIES

 

The Series indemnifies the Fund’s officers and the Board of Directors for certain liabilities that might arise from their performance of their duties to the Series. Additionally, in the normal course of business the Fund enters into contracts that contain a variety of representations and warranties and which provide for general indemnifications. The Fund’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Fund that have not yet occurred. However, based on its experience, the Fund expects the risk of loss to be remote.

 

NOTE G - CAPITAL SHARE TRANSACTIONS

 

The Fund has authorized 10,000,000 shares of common stock at $0.01 par value per share. These shares are issued under either of the two series of the Fund. Each share has equal dividend, distribution and liquidation rights. Transactions in capital stock of the Series were as follows:

 

   Shares   Amount 
         
Balance at October 31, 2020   503,065.995   $7,528,631 
           
Shares sold during 2021   4,364.206   $107,193 
Shares redeemed during 2021   (27,813.453)   (685,365)
Reinvestment of Distributions, December 28, 2020   1,014.202    22,794 
Balance at October 31, 2021   480,630.950   $6,973,253 
           
Shares sold during six months ended April 30, 2022   1,766.577   $45,327 
Shares redeemed during six months ended April 30, 2022   (273.449)   (7,150)
Balance at April 30, 2022   482,124.078   $7,011,430 

 

12
 

 

GREATER WESTERN NEW YORK SERIES

(A Series Within Bullfinch Fund, Inc.)

 

FINANCIAL STATEMENTS AS OF

APRIL 30, 2022

(UNAUDITED)

 

13
 

 

GREATER WESTERN NEW YORK SERIES

(A SERIES WITHIN BULLFINCH FUND, INC.)

STATEMENT OF ASSETS AND LIABILITIES

APRIL 30, 2022 (UNAUDITED)

 

ASSETS    
     
Investments in Securities, at Fair Value, Identified Cost of $ 841,603  $1,948,206 
      
Cash and Cash Equivalents   464,556 
      
Accrued Interest and Dividends   1,750 
      
Prepaid Expenses   658 
      
Total Assets  $2,415,170 
      
LIABILITIES AND NET ASSETS     
      
LIABILITIES     
      
Accrued Expenses  $883 
      
Due to Investment Adviser   2,266 
      
NET ASSETS     
      
Net Assets (Equivalent to $23.81 per share based on 101,283.013 shares of stock outstanding)   2,412,021 
      
Total Liabilities and Net Assets  $2,415,170 
      
COMPOSITION OF NET ASSETS     
     
Shares of Common Stock - Par Value $.01; 101,283.013 Shares Outstanding  $1,486,534 
      
Accumulated Net Investment Loss & Realized Loss from Securities Transactions   (181,116)
      
Net Unrealized Appreciation on Investments   1,106,603 
      
Net assets at April 30, 2022  $2,412,021 

 

The accompanying notes are an integral part of these statements

 

14
 

 

GREATER WESTERN NEW YORK SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)

SCHEDULE OF INVESTMENTS IN SECURITIES

APRIL 30, 2022 (UNAUDITED)

 

   Historical    Fair 
   Shares  Cost   Value 
            
Level 1 – Common Stocks – 80.75%              
* ASTERISK DENOTES A NON INCOME PRODUCING SECURITY              
               
Banking & Finance – 12.74%              
Community Bank System   1,200   23,452    77,280 
M &T Bank Corp.   300   29,839    49,992 
Manning & Napier Inc.   14,100   66,903    180,057 
        120,194    307,329 
               
Aerospace - 10.56%              
L3Harris Technologies Inc.   500   24,989    116,130 
Moog, Inc. Class A   637   15,976    50,877 
Northrop Grumman Corp   200   2,294    87,880 
        43,259    254,887 
               
Electrical Equipment – 9.38%              
Corning, Inc.   2,200   26,502    77,418 
General Electric Co.   843   132,940    62,846 
Ultralife Corporation*   17,400   65,037    85,956 
       224,479    226,220 
               
Medical Products & Supplies - 9.23%              
Bristol-Myers Squibb Co.   1,150   29,276    86,560 
Integer Holdings Corp.*   850   17,417    63,895 
Johnson & Johnson   400   22,617    72,184 
       69,310    222,639 
               
Commercial Services - 5.12%              
Paychex, Inc.   975   25,852    123,562 
               
Real Estate & Related - 4.94%              
Life Storage Inc.   900   21,318    119,241 
               
Foods & Beverages - 4.08%              
Constellation Brands Inc.   400   2,509    98,436 
               
Utilities - Natural Resources - 3.63%              
National Fuel Gas Co.   1,250   50,833    87,662 
               
Steel - 3.14%              
Gibraltar Industries Inc.*   2,000   25,111    75,680 
               
Electronics Components - 2.81%              
Astronics Corp.*   7,000   40,691    67,830 
               
Computers - Software - 2.74%              
Oracle Corporation   900   12,070    66,060 

 

   Historical   Fair 
   Shares  Cost   Value 
            
Level 1 – Common Stocks – 80.75%              
               
Retail - Specialty – 2.39%              
CVS Health Corp.   600   33,590    57,678 
               
Computers - Services - 2.38%              
Computer Task Group Inc.*   6,000   33,877    57,300 
               
Telecommunications – 2.09%              
AT&T Inc.   950   25,666    17,917 
Verizon Communications   700   34,210    32,410 
        59,876    50,327 
               
Airlines - 2.03%              
Southwest Airlines Co.*   1,050   19,813    49,056 
               
Automotive – 1.99%              
Monro Inc.   1,050   12,443    48,016 
               
Metal Fabrication & Hardware – 0.42%              
Graham Corporation *   1,400   15,140    10,206 
               
Instruments - 0.33%              
Taylor Devices Inc.*   877   4,394    7,946 
               
Office Equipment - 0.25%              
Xerox Holdings Corp.   350   12,742    6,090 
               
Media - 0.17%              
Warner Brothers Discovery*   229   8,011    4,156 
               
Machinery - 0.15%              
Columbus McKinnon Corp.   100   2,344    3,545 
               
Railroads - 0.13%              
Wabtec Corporation   36   2,810    3,237 
               
Industrial Materials - 0.05%              
Servotronics, Inc.*   100   937    1,103 
               
Total Investments in Securities       841,603    1,948,206 
               
Level 1 – Cash & Equivalents -19.25%              
Schwab Bank - 19.25%       464,556    464,556 
Bank Sweep Interest Rate 0.01%              
               
Total Invested Assets      $1,306,159   $2,412,762 

 

The accompanying notes are an integral part of these statements

 

15
 

 

GREATER WESTERN NEW YORK SERIES

(A SERIES WITHIN BULLFINCH FUND, INC.)

SCHEDULE OF INVESTMENTS IN SECURITIES

APRIL 30, 2022 (UNAUDITED)

 

Table of Industries        
         
Industry   Fair Value    Percent 
           
Aerospace  $254,887    10.56%
Airlines  $49,056    2.03%
Automotive  $48,016    1.99%
Banking & Finance  $307,329    12.74%
Commercial Services  $123,562    5.12%
Computers – Services  $57,300    2.38%
Computers – Software  $66,060    2.74%
Electrical Equipment  $226,220    9.38%
Electronics Components  $67,830    2.81%
Foods & Beverages  $98,436    4.08%
Industrial Materials  $1,103    0.05%
Instruments  $7,946    0.33%
Machinery  $3,545    0.15%
Media  $4,156    0.17%
Medical Products & Supplies  $222,639    9.23%
Metal Fabrication & Hardware  $10,206    0.42%
Office Equipment  $6,090    0.25%
Railroads  $3,237    0.13%
Real Estate & Related  $119,241    4.94%
Retail – Specialty  $57,678    2.39%
Steel  $75,680    3.14%
Telecommunications  $50,327    2.09%
Utilities – Natural Resources  $87,662    3.63%
Total Equities  $1,948,206    80.75%
           
Cash & Equivalents  $464,556    19.25%
(Bank Sweep Interest Rate 0.01%)          
           
Total Invested Assets  $2,412,762    100.00%

 

The accompanying notes are an integral part of these statements

 

16
 

 

GREATER WESTERN NEW YORK SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)

STATEMENTS OF OPERATIONS

FOR THE 6 MONTHS ENDED APRIL 30, 2022 (UNAUDITED)

 

INVESTMENT INCOME:     
Dividends & Interest Income  $16,483 
FEES AND EXPENSES:     
Investment Adviser Fees   13,392 
Dues and Subscriptions   1,224 
Custodian Fees   1,200 
Director’s Fees   1,200 
Legal and Professional   1,049 
D&O/E&O   465 
Maryland Taxes   150 
Registration Fees   75 
Telephone   40 
New York State Taxes   25 
Licenses & Permits   25 
Total Expense   18,845 
Net investment loss   (2,362)
      
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:     
Realized gain from securities transactions   66 
Change in unrealized appreciation (depreciation)   (62,641)
Net loss on investments   (62,575)
CHANGE IN NET ASSETS FROM OPERATIONS  $(64,937)

 

GREATER WESTERN NEW YORK SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)

STATEMENTS OF CHANGES IN NET ASSETS

 

   Six Months Ended   Year Ended 
   April 30,   October 31, 
   2022*   2021 
CHANGE IN NET ASSETS FROM OPERATIONS:          
Net investment gain (loss)  $(2,362)  $(5,104)
Net realized gain from securities transactions   66    62,800 
Net change in unrealized appreciation (depreciation) of investments   (62,641)   526,156 
Change in net assets from operations   (64,937)   583,852 
           
DISTRIBUTIONS TO SHAREHOLDERS:          
Distribution of ordinary income   0    (662)
Distribution of capital gains   (62,799)   (118,270)
Decrease in net assets from distributions to shareholders   (62,799)   (118,932)
           
CAPITAL SHARE TRANSACTIONS:          
Shares Sold   19,027    29,989 
Reinvestment of Distributions to shareholders   62,799    118,932 
Shares Redeemed   0    0 
Increase in net assets from capital share transactions   81,826    148,921 
TOTAL INCREASE (DECREASE) IN NET ASSETS   (45,910)   613,841 
           
NET ASSETS:          
Beginning of period   2,457,931    1,844,090 
End of period  $2,412,021   $2,457,931 

 

*Unaudited

 

The accompanying notes are an integral part of these statements

 

17
 

 

GREATER WESTERN NEW YORK SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)

FINANCIAL HIGHLIGHTS

(PER SHARE DATA FOR A SHARE OUTSTANDING)

 

   Six Months Ended   Year Ended   Year Ended   Year Ended   Year Ended   Year Ended 
  

April 30,

   October 31,   October 31,   October 31,   October 31,   October 31, 
   2022*   2021   2020   2019   2018   2017 
                         
NET ASSET VALUE, beginning of period  $25.09   $20.16   $23.28   $20.80   $22.23   $20.36 
                               
INCOME (LOSS) FROM INVESTMENT OPERATIONS                              
Net investment income (loss)   (0.02)   (0.05)   0.01    0.03    (0.02)   0.00 
Net gain (loss) on securities both realized and unrealized   (0.62)   6.28    (3.10)   2.48    (0.42)   2.21 
Total from investment operations   (0.64)   6.23    (3.09)   2.51    (0.44)   2.21 
                               
DISTRIBUTIONS TO SHAREHOLDERS FROM:                              
Distribution of ordinary income   0.00    (0.01)   (0.03)   (0.03)   (0.06)   0.00 
Distribution of capital gains   (0.64)   (1.29)   0.00    0.00    (0.93)   (0.34)
Total Stock Dividend Distributions   (0.64)   (1.30)   (0.03)   (0.03)   (0.99)   (0.34)
                               
NET ASSET VALUE, end of period  $23.81   $25.09   $20.16   $23.28   $20.80   $22.23 
                               
NET ASSETS**, end of period  $2,412,021   $2,457,931   $1,844,090   $2,084,120   $1,851,110   $1,952,720 

 

*Unaudited

** Rounded

 

GREATER WESTERN NEW YORK SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)

FINANCIAL HIGHLIGHTS

(RATIOS AND SUPPLEMENTAL DATA)

 

   Six Months Ended   Year Ended   Year Ended   Year Ended   Year Ended   Year Ended 
  

April 30,

   October 31,   October 31,   October 31,   October 31,   October 31, 
   2022*   2021   2020   2019   2018   2017 
                         
RATIO OF EXPENSES TO AVERAGE                              
NET ASSETS**   0.78%***   1.52%   1.54%   1.53%   1.61%   1.37%
                               
RATIO OF NET INVESTMENT INCOME TO                              
AVERAGE NET ASSETS**   (0.10)%***   (0.22)%   0.03%   0.12%   (0.08)%   0.00%
                               
PORTFOLIO TURNOVER RATE**   0.00%***   0.00%   5.61%   0.01%   2.32%   2.87%
                               
TOTAL RETURN   (2.65)%   31.73%   (13.30)%   12.11%   (2.15)%   10.89%

 

*Unaudited

**Per share amounts calculated using the average shares method

*** The ratios presented were calculated using operating data for the six-month period from November 1, 2021 to April 30, 2022.

 

The accompanying notes are an integral part of these statements

 

18
 

 

GREATER WESTERN NEW YORK SERIES (A SERIES WITHIN BULLFINCH FUND, INC.)

NOTES TO FINANCIAL STATEMENTS APRIL 30, 2022 (UNAUDITED)

 

NOTE A - SCOPE OF BUSINESS

 

The Greater Western New York Series (the “Series”) is a series within the Bullfinch Fund, Inc. (the “Fund”), which was organized as a Maryland corporation registered under the Investment Company Act of 1940 as an open-ended non-diversified management investment company. The Fund offers two series of common stock. In addition to the Greater Western New York Series, the Fund also offers the Unrestricted Series.

 

The investment objective of the Series is to seek capital appreciation through the investment in common stock of companies with an important economic presence in the Greater Western New York Region. The Adviser seeks to achieve this objective by using an asset mix consisting primarily of exchange listed securities and over-the-counter common stocks as well as U.S. Government securities maturing within five years.

 

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

The following is a summary of significant accounting policies followed by the Series in the preparation of its financial statements. These policies are in conformity with accounting principles generally accepted in the United States (“GAAP”). The Series follows the investment company accounting and reporting guidance of the Financial Accounting Standard Board Accounting Standard Codification 946, Financial Services – Investment Companies.

 

Fair Value Measurements – ASC 820-10 establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value:

 

Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

 

Level 2: Other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

 

Level 3: Unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

 

The following is a description of the valuation methodologies used for assets measured at fair value:

 

Cash & Equivalents- Cash consists of amounts deposited in a bank sweep account and is federally insured. The Series has not experienced any losses on such amounts and believes it is not exposed to any significant credit risk on cash.

 

Security Valuation - The Series records its investments at fair value and is in compliance with FASB ASC 820-10-50. Securities traded on national securities exchanges or the NASDAQ National Market System are valued daily at the closing prices of the securities on those exchanges and securities traded on over-the-counter markets are valued daily at the closing bid prices. Short-term and money market securities are valued at amortized cost, which approximates market value.

 

19
 

 

ASSETS AT FAIR VALUE AS OF:

 

   4/30/22 
   LEVEL 1 
COMMON STOCKS  $1,948,206 
CASH & EQUIVALENTS  $464,556 
TOTALS BY LEVEL  $2,412,762 

 

In cases where market prices are unreliable or not readily available, for example, when trading on securities are halted as permitted by the SEC or when there is no trading volume on an Over-the-Counter security held by the Fund, the Fund relies on fair value pricing provided by the Adviser. In performing its fair value pricing, the Adviser acts under the ultimate supervision of, and follows, the policies of the Board of Directors. The Board of Directors retains the right to determine its own fair value price should it have reason to believe the price provided by the Adviser does not reflect fair value. Valuing securities at fair value involves greater reliance on judgment than securities that have readily available market quotations. There can be no assurance the Fund could obtain the fair value assigned to a security if they were to sell the security at approximately the time at which the Fund determines their net asset value per share.

 

Series Allocations - Common expenses of the Fund are evenly split between the two series of the Fund unless the Board of Directors approves an alternative allocation of expenses based on management’s estimate.

 

Income Taxes - It is the policy of the Fund to comply with the requirements of Subchapter M of the Internal Revenue Code (the “Code”) applicable to regulated investment companies and to distribute all of its taxable income to its shareholders. In addition, the Fund intends to distribute an amount sufficient to avoid imposition of any excise tax under Section 4982 of the Code. Therefore, no provision for federal income taxes or excise taxes has been made.

 

Management has reviewed all open tax years and major tax jurisdictions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions taken on returns filed or expected to be taken on a tax return. The Series’tax returns are open for examination by the relevant tax authorities until expiration of the applicable statute of limitation which is generally three years after the filing of the tax return.

 

Distributions to Shareholders - Distributions to shareholders are recorded on the ex-dividend date. The Series made a distribution of its ordinary income of $662 to its shareholders on December 28, 2020 in the form of stock dividends equal to 29.561 shares of stock. The Series made a distribution of its long term capital gains of $118,270 to its shareholders on December 28, 2020 in the form of stock dividends equal to 5,279.914 shares of stock. . The Series made a distribution of its long term capital gains of $62,799 to its shareholders on December 27, 2021 in the form of stock dividends equal to 2,545.558 shares of stock.

 

Other - The Series follows industry practice and records security transactions on the trade date. The specific identification method is used for determining gains and losses for financial statement and income tax purposes. Dividend income is recorded on the ex-dividend date. Non–cash dividends received in the form of stock, if any, are recorded as dividend income at fair value. Distributions received by the Series may include a return of capital that is estimated by management. Such amounts are recorded as reduction of the cost of investments or reclassified to capital gains.

 

Use of Estimates - The preparation