NOTES TO FINANCIAL STATEMENTS
prevailing exchange rates at period end. Purchases and sales of investment securities, income and expenses are
translated into U.S. dollars at the prevailing exchange rates on the respective dates of the transactions.
Net realized and unrealized gains and losses on foreign currency transactions represent net gains and losses
between trade and settlement dates on securities transactions, the disposition of forward foreign currency
exchange contracts and foreign currencies, and the difference between the amount of net investment income
accrued and the U.S. dollar amount actually received. That portion of both realized and unrealized gains and
losses on investments that results from fluctuations in foreign currency exchange rates is not separately disclosed
but is included with net realized and unrealized gains and losses on investment securities.
REPURCHASE AGREEMENTS. The Fund may enter into repurchase agreements with certain banks and
broker/dealers whereby the Fund, through its custodian or sub-custodian bank, receives delivery of the
underlying securities, the amount of which at the time of purchase and each subsequent business day is required
to be maintained at such a level that the market value is equal to at least the principal amount of the repurchase
price plus accrued interest.
FEDERAL INCOME TAXES. The Fund's policy is to comply with the requirements of the Internal Revenue
Code, as amended, which are applicable to regulated investment companies and to distribute all of its taxable
income to its shareholders. Accordingly, the Fund paid no federal income taxes and no federal income tax
provision was required. At October 31, 1999, the Fund had a net tax basis capital loss carryforward of
approximately $656,000, which may be applied with certain limitations against any realized net taxable capital
gains of each succeeding year until fully utilized or until October 31, 2004, the expiration date, whichever occurs
DISTRIBUTION OF INCOME AND GAINS.