NOTES TO FINANCIAL STATEMENTS
asset backed securities may be valued at prices obtained from a bond pricing service or at a price obtained from
one or more of the major broker/dealers in such securities. In cases where broker/dealer quotes are obtained, the
Adviser may establish procedures whereby changes in market yields or spreads are used to adjust, on a daily
basis, a recently obtained quoted bid price on a security.
It is the Portfolio's policy to meet the requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute all of its investment company taxable income and net realized gains, if any,
to shareholders. Therefore, no provisions for federal income or excise taxes are required.
3. Investment Income and Investment Transactions
Interest income is accrued daily. Investment transactions are accounted for on the date securities are purchased
or sold. The Portfolio amortizes premiums and accretes discounts as adjustments to interest income. Investment
gains and losses are determined on the identified cost basis.
4. Income and Expenses
All income earned and expenses incurred by the Portfolio are borne on a pro-rata basis by each settled class of
shares, based on the proportionate interest in the Portfolio represented by the net assets of such class, except that
the Portfolio's Class B and Class C shares bear higher distribution and transfer agent fees than Class A shares.
5. Dividends and Distributions
Dividends and distributions to shareholders are recorded on the ex-dividend date. Income dividends and capital
gains distributions are determined in accordance with federal tax regulations and may differ from those
determined in accordance with accounting principles generally accepted in the United States. To the extent these
differences are permanent, such amounts are reclassified within the capital accounts based on their federal tax
basis treatment; temporary differences do not require such reclassification.
During the current