THE OAKMARK SELECT FUND Annual Report

THE VALUE OF A $10,000 INVESTMENT IN THE OAKMARK SELECT FUND FROM ITS INCEPTION (11/1/96) TO PRESENT (9/30/02) AS COMPARED TO THE STANDARD & POOR'S 500 INDEX²

	Average Annual Total Returns⁴
	(as of 9/30/02)
	Total Return Last 3 Months*	1-year	5-year	Since Inception (11/1/96)

Oakmark Select Fund	-15.58%	-13.85%	12.70%	20.21%
S&P 500	-17.28%	-20.49%	-1.63%	3.97%
S&P MidCap 400¹¹	-16.55%	-4.70%	5.38%	10.47%
Lipper Mid Cap Value Index¹²	-17.46%	-8.22%	0.38%	5.22%

The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
Past performance is no guarantee of future results. Investment return and principal value vary, and you may have a gain or loss when you sell shares. Average annual total return measures annualized change, while total return measures aggregate change.
* Not annualized

The Oakmark Select Fund declined by 16% during the quarter and by 14% for the fiscal year. For a little over two years, despite the bear market, we were able to prosper by owning undervalued stocks that were not a part of the bull market's excesses. In fact, the Fund achieved an all-time high NAV¹³ in May of this year. Since May, however, the market decline has become very broad-based—all capitalization sizes and all investment styles have been hit by roughly the same amount. We both have personal assets invested in the Fund, so we share the pain that all our investors have experienced these last four months. Although we cannot predict when the bottom will be reached, we strongly believe that prices have declined to levels that make it highly likely that today's long-term investors will earn higher returns in stocks than in other investments.

In the nearly six years since we started The Oakmark Select Fund, we have owned sixty different stocks, and in three of those we have lost over half of our investment. The most recent, Electronic Data Systems (EDS), shocked the market last month by drastically lowering earnings expectations. No explanation of that miss made sense: either management had not been candid about their prospects or, perhaps worse, didn't have the information flow to know how weak their business was, or despite their large book of long-term contracts, their profitability was more dependent on last-minute, add-on sales than realized. We didn't like any of those answers and began selling our EDS position, despite the stock having fallen from $36 to $22. When the stock fell below $20, we stopped selling. We felt that EDS was suffering artificial pressure from managers who didn't want EDS on their quarter-end statements and from hedge funds that were trying to encourage panic selling. Unfortunately, we had sold less than a quarter of our holdings. Our belief was, and still is, that for a company likely to earn between $2 and $3 per share next year, the price should be higher than the low teens. We still have just over 1% of our assets in EDS and will be looking for a better opportunity to sell that position. As unpleasant as these mistakes are, they are included in our long-term performance record, which continues to be excellent both in relative and absolute terms.

Name	Shares Held	Market Value

Common Stocks—92.2%
Other Consumer Goods & Services—13.1%
H&R Block, Inc.	7,738,800	$325,106,988
Mattel, Inc.	9,554,000	172,067,540

		497,174,528
Cable Systems & Satellite TV—4.0%
AOL Time Warner Inc. (a)	13,000,000	$152,100,000
Information Services—9.8%
Moody's Corporation	3,984,000	$193,224,000
The Dun & Bradstreet Corporation (a)(b)	5,321,300	178,848,893

		372,072,893
Publishing—3.9%
Knight-Ridder, Inc.	2,606,500	$147,032,665
Retail—16.5%
Yum! Brands, Inc (a)	7,422,000	$205,663,620
The Kroger Co. (a)	10,362,500	146,111,250
Office Depot, Inc. (a)	11,434,900	141,106,666
Toys ‘R' Us, Inc. (a)(b)	12,698,500	129,270,730

		622,152,266
Bank & Thrifts—17.8%
Washington Mutual, Inc.	21,351,400	$671,928,558
Investment Management—2.9%
Stilwell Financial Inc	9,030,400	$108,996,928
Health Care Services—4.1%
IMS Health Incorporated	10,392,000	$155,568,240
Pharmaceuticals—4.4%
Chiron Corporation (a)	4,811,400	$168,110,316
Telecommunications—3.3%
Sprint Corporation	13,727,500	$125,194,800
Computer Services—5.3%
First Data Corporation	5,430,400	$151,779,680
Electronic Data Systems Corporation	3,451,500	48,251,970

		200,031,650
Office Equipment—2.8%
Xerox Corporation (a)	21,547,700	$106,661,115
Oil & Natural Gas—4.3%
Burlington Resources Inc.	4,201,800	$161,181,048
Total Common Stocks (Cost: $3,372,614,639)		3,488,205,007
	Par Value

Short Term Investments—7.4%
U.S. Government Bills—4.1%
United States Treasury Bills, 1.58% -1.975%
due 10/3/2002 - 12/12/2002	$155,000,000	$154,792,889
Total U.S. Government Bills (Cost: $154,782,375)		154,792,889
Repurchase Agreements—3.3%
IBT Repurchase Agreement, 1.75% due 10/1/2002,
repurchase price $121,005,882 collateralized by
U.S. Government Agency Securities	$121,000,000	$121,000,000
IBT Repurchase Agreement, 1.11% due 10/1/2002,
repurchase price $2,118,317 collateralized by a
U.S. Government Agency Security	2,118,252	2,118,252

Total Repurchase Agreement (Cost: $123,118,252)		123,118,252
Total Short Term Investments (Cost: $277,900,627)		277,911,141
Total Investments (Cost $3,650,515,266)—99.6%		$3,766,116,148
Other Assets In Excess Of Other Liabilities—0.4%		15,936,183

Total Net Assets—100%		$3,782,052,331


William C. Nygren, CFA Portfolio Manager bnygren@oakmark.com	Henry R. Berghoef, CFA Portfolio Manager berghoef@oakmark.com

(a)	Non-income producing security.
(b)	See footnote number five in the Notes to Financial Statements regarding transactions in affiliated issuers.

THE OAKMARK SELECT FUND

Report from Bill Nygren and Henry Berghoef, Portfolio Managers

Report from Bill Nygren
and Henry Berghoef, Portfolio Managers