<PAGE>
<TABLE>
<C> <S>
Dresdner RCM
Global Funds
DECEMBER 31, 1999 Annual Report
</TABLE>
[Dresdner Logo]
<PAGE>
February 22, 2000
Dear Shareholder:
We are pleased to present the Dresdner RCM Global Funds' Annual
Shareholder Report for the 12 months ended December 31, 1999. By any measure,
1999 was a spectacular year for Dresdner RCM Global Funds (the "Funds"), as
nearly every mutual fund outperformed its benchmark, in some cases by a wide
margin.
The driving force behind the Funds' superior results was a willingness
to boldly embrace technology and telecommunications stocks throughout the world
as the Internet and wireless communications generate tremendous investment
opportunities. Although these sectors remain overweighted, Dresdner RCM Global
Investors LLC, the Funds' investment manager, continues to use a bottom-up
analysis of company fundamentals, combined with a careful assessment of
projected earnings growth to select companies that offer the best potential for
achieving their business goals.
To be sure, 1999 was an excellent year for equities in the major markets
of the world. In the U.S., the S&P 500 Index and the NASDAQ set records, as the
economy continued to enjoy the longest period of uninterrupted prosperity in US
history. In Japan, the stock market began to snap back from a decade-long slump,
as cultural changes favoring shareholder value began to take place. Even in
Europe, where the Euro steadily weakened throughout the year, investors began to
enjoy improved returns in the second half of the year as economic growth
improved.
In identifying possible investments, Dresdner RCM, in cooperation with
its worldwide affiliates, draws on the expertise of nearly 200 investment
professionals, primarily securities analysts and portfolio managers. In addition
to having traditional finance credentials, many also have advanced degrees or
industry experience in the areas of the market that they cover such as
engineering or medicine. The Funds also draw from Grassroots-SM- Research, a
unique adjunct to traditional research efforts, which uncovers and confirms
marketplace demand for key products and services.
Inside, you will find discussions of each mutual fund by Dresdner RCM
Global Fund portfolio managers. In comprehensive detail, relevant market
conditions, the factors affecting the Funds' performance, the investment
strategies employed in response to last year's economic and market conditions as
well as the outlook for 2000 is reviewed and discussed. Each report also
includes performance summaries, lists of holdings and portfolio weightings as of
December 31, 1999.
We are extremely proud of the performance of our mutual funds this past
year, and thank you for your continued confidence in the Dresdner RCM Global
Funds. If you would like more information on a specific fund, or if you have any
questions about the material in this report, please call us at 1-800-726-7240 or
visit us at www.DRCMFunds.com.
Sincerely,
<TABLE>
<S> <C>
/s/ DeWitt F. Bowman /s/ Theodore J. Coburn
DeWitt F. Bowman Theodore J. Coburn
Chairman Chairman
Dresdner RCM Global Funds, Inc. Dresdner RCM Investment Funds Inc.
Dresdner RCM Capital Funds, Inc.
</TABLE>
<PAGE>
Dresdner RCM Large Cap Growth Fund
Management's Performance Review
Surging technology and telecommunications stocks and superior stock
selection helped the Dresdner RCM Large Cap Growth Fund to significantly
outperform the S&P 500 Index for the second year in a row. For the year ended
December 31, 1999, the Fund posted total returns of 44.84% and 44.46% for
Class I and Class N shares, respectively. In comparison, the Fund's benchmark,
the S&P 500 Index, returned 21.04% for the year.
MARKET REVIEW
As 1999 began, large cap growth stocks were favored in the uncertain
global economic environment. After central banks lowered interest rates around
the world, global economies began to improve. Investors switched their attention
to economically sensitive stocks and a powerful, though short-lived, rally in
value stocks occurred in the second quarter. However, the rally ended as the
Federal Reserve Board shifted to a tightening stance and began raising short
term interest rates to slow the economy and prevent a return of inflation. Long-
term interest rates, sensitive to inflation expectations, began a sustained
upward climb.
As the year progressed, stocks were caught in a tug-of-war between
higher interest rates and stronger earnings. Prices for most stocks remained
locked in a relatively tight range. Technology stocks, however, distinguished
themselves through their outstanding growth prospects and were accorded
ever-higher prices. In late October, U.S. economic reports suggesting solid
growth coupled with low inflation sent stock prices skyrocketing. The Fed, still
concerned about the strength of the U.S. economy, raised short-term interest
rates for the third time. Investors ignored the higher rates and focused on
strong third-quarter profits, seeking companies with exciting growth stories.
Money poured into technology and telecommunications stocks, many of which
doubled in price in the fourth quarter, as investors worried less about Y2K and
once again became enamored with companies (large and small) with some connection
to the Internet.
FACTORS AFFECTING PERFORMANCE
Dresdner RCM Global Investors LLC ("Dresdner RCM"), the Fund's
investment manager, continued to emphasize Internet, Internet infrastructure,
wireless and communication infrastructure stocks, with many posting substantial
gains. Technology and telecommunications services stocks represented 46.6% of
the portfolio at year-end, substantially more than the S&P 500 Index.
Underweightings to other sectors, particularly in interest-sensitive stocks such
as financial services, also served the Fund well as these categories generally
performed poorly.
EMC and Cisco Systems, two of the Fund's larger holdings, each more than
doubled in price in 1999, as they continued their dominance of data storage
systems and Internet infrastructure, respectively. As of December 31, 1999, the
Fund also maintained a combined weighting of over 4% in AOL and Yahoo!,
companies with early and established franchises on the Internet and greater than
expected E-commerce during the year.
In telecommunication services, the Fund had significant commitments in
Nextel Communications, QUALCOMM and JDS Uniphase. While telecom companies active
in long-distance communications were generally weak, wireless-service and
equipment companies, such as these three, were much stronger. QUALCOMM soared
over 2600% on strong subscriber growth, driving higher-than-expected royalties
and chip sales. Additionally, as investors recognized wireless as an eventual
platform for Internet access, QUALCOMM's CDMA technology was recognized as the
leader in that market. As companies race to provide greater bandwidth, JDS
Uniphase has become the recognized leader in the fiber optics components
industry for telecommunications and cable TV. Shares of JDS Uniphase rose 830%
during the year. Meanwhile, strong subscriber penetration and new wireless data
services drove Nextel's stock gains of 337% for the year.
Biotechnology was also strong in 1999, with PE Biosystems, a leading
supplier of instrumentation for genetic, protein and drug discovery research, up
172% for the year. However, the Fund was penalized for its overweight in
pharmaceutical stocks, which performed less favorably due to the potential for
Medicare expansion to cover prescription drugs. This was more than offset by
positive stock selection aided by Grassroots-SM- Research.
Consumer non-durables, including the Fund's holdings of Coke and
Gillette, also performed poorly for most of the year as a number of consumer
products
Page 2
<PAGE>
Dresdner RCM Large Cap Growth Fund
Management's Performance Review
companies announced lower expectations for revenue growth. Although their
fundamentals didn't materially improve, the stocks strengthened in the fourth
quarter as investors were attracted to their low relative valuations as well as
the exposure to improving global markets.
A disappointing holding in the Fund was Tyco International which
declined dramatically when the company's method of accounting for acquisitions
was questioned. However, we believe the company's fundamentals remain strong as
its assortment of businesses, including medical products, security systems and
electronics continue to generate strong cash flow. The stock remains a holding
in the Fund.
OUTLOOK
Although valuations in technology and telecommunications stocks are
quite high, we believe that their growth prospects compared to the rest of the
economy are substantially better. Therefore, the Fund is likely to remain
overweighted in these groups but will likely trim some positions into the new
year. Pharmaceutical stocks are likely to remain flat during the Congressional
debate over Medicare coverage, while the growth prospects for consumer
non-durables have improved marginally. Meanwhile, interest rates are likely to
continue to rise as the Federal Reserve Board attempts to slow the economy.
Investors will likely favor companies than can still show profit growth in a
rising interest rate environment.
Page 3
<PAGE>
Dresdner RCM Large Cap Growth Fund
Total Return Index Comparison(b)
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
$10,000 INVESTMENT (12/31/96 - 12/31/99)(C)(D)(E)
<S> <C> <C>
Class I Shares S&P 500 Stock Index(a)
12/96 $10,000 $10,000
1/97 $10,640 $10,625
2/97 $10,570 $10,708
3/97 $9,920 $10,268
4/97 $10,490 $10,881
5/97 $11,300 $11,544
6/97 $11,880 $12,061
7/97 $13,020 $13,021
8/97 $12,210 $12,292
9/97 $13,230 $12,965
10/97 $12,930 $12,532
11/97 $13,140 $13,113
12/97 $13,199 $13,338
1/98 $13,599 $13,486
2/98 $14,647 $14,458
3/98 $15,337 $15,199
4/98 $15,737 $15,352
5/98 $15,263 $15,088
6/98 $16,190 $15,701
7/98 $16,232 $15,533
8/98 $13,515 $13,287
9/98 $14,716 $14,139
10/98 $15,737 $15,288
11/98 $16,864 $16,215
12/98 $19,020 $17,148
1/99 $20,470 $17,865
2/99 $19,728 $17,310
3/99 $21,460 $18,002
4/99 $21,118 $18,699
5/99 $20,305 $18,257
6/99 $21,837 $19,271
7/99 $21,330 $18,670
8/99 $21,613 $18,577
9/99 $21,425 $18,068
10/99 $22,850 $19,211
11/99 $24,265 $19,601
12/99 $27,549 $20,756
</TABLE>
PERFORMANCE(b)
DECEMBER 31, 1999
<TABLE>
<CAPTION>
CUMULATIVE
SINCE SINCE
LARGE CAP GROWTH FUND 1 YEAR 3 YEARS INCEPTION INCEPTION
<S> <C> <C> <C> <C>
Class I
Average Annual Total Return(c) 44.84% 40.18% 40.18% 175.49%
Class N
Average Annual Total Return(d) 44.46% 40.06% 40.06% 174.77%
S&P 500 Stock Index
Average Annual Total Return(a) 21.04% 27.56% 27.56% 107.56%
</TABLE>
The data above represents past performance of the Fund and may not
indicate future performance. The investment return and principal value of an
investment in the Fund will fluctuate, so that shares, when redeemed, may be
worth more or less than their original cost.
- --------------------------------
(a) The Standard & Poor's 500 Stock Index is a capitalization-weighted index of
500 stocks that attempts to measure performance of the broad domestic
economy through changes in the aggregate market value of 500 stocks
representing major industries.
(b) Returns assume reinvestment of all dividends and capital gains
distributions at net asset value.
(c) Class I shares commenced operations on December 31, 1996.
(d) Class N shares were first issued on March 2, 1999, and pay Rule 12b-1 fees.
Class N returns through December 31, 1998 are based on Class I returns and
reflect Rule 12b-1 fees.
(e) The value of a $10,000 investment for Class N is $27,477 for the period
from 12/31/96 - 12/31/99. The performance of the Class N shares is lower
than Class I shares due to the effects of 12b-1 fees.
Page 4
<PAGE>
Dresdner RCM Large Cap Growth Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS
CONSUMER NON-DURABLES SECTOR 14.3%
BEVERAGE/TOBACCO 2.8%
2,000 US Anheuser-Busch Companies Inc. $ 141,750
2,500 US Coca Cola Co. 145,625
4,500 US Coca Cola Enterprises Inc. 90,562
3,000 US Philip Morris Co. Inc. 69,563
-----------
447,500
-----------
HOUSEHOLD/RELATED NON-DURABLES 3.5%
4,000 US Colgate Palmolive Co. 260,000
1,800 US Gillette Co. 74,138
2,000 US Procter & Gamble Co. 219,125
-----------
553,263
-----------
LEISURE TIME PRODUCTS/SERVICES 1.8%
1,800 US Carnival Corp. 86,063
5,000 US McDonalds Corp. 201,562
-----------
287,625
-----------
RETAIL TRADE 6.2%
3,000 US Circuit City Stores Inc. 135,188
1,600 US Costco Cos. Inc. * 146,000
1,100 US Dayton Hudson Corp. 80,781
2,250 US Home Depot Inc. 154,266
2,500 US Nike Inc. (Class B) 123,906
2,500 US Safeway Inc. * 88,906
3,500 US Wal-Mart Stores Inc. 241,937
-----------
970,984
-----------
CYCLICAL/CAPITAL GOODS SECTOR 11.0%
AEROSPACE/DEFENSE 2.1%
1,400 US General Dynamics Corp. 73,850
2,812 US Honeywell International Inc. 162,217
1,500 US United Technologies Corp. 97,500
-----------
333,567
-----------
ELECTRICAL EQUIPMENT 4.0%
4,100 US General Electric Co. 634,475
INDUSTRIAL EQUIPMENT 3.3%
13,400 BH Tyco International Ltd. 520,925
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 5
<PAGE>
Dresdner RCM Large Cap Growth Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS (CONTINUED)
RAW/BASIC MATERIALS 1.6%
3,000 US Alcoa Inc. $ 249,000
ENERGY SECTOR 3.8%
ENERGY 3.8%
1,000 US Chevron Corp. 86,625
5,000 US Conoco. Inc. (Class A) 123,750
6,000 US Enron Corp. 266,250
2,000 US Schlumberger Ltd. 112,500
387 US Transocean Sedco Forex Inc. 13,037
-----------
602,162
-----------
HEALTH CARE SECTOR 14.6%
DRUGS AND HOSPITAL SUPPLIES 14.6%
8,800 US Amgen Inc. * 528,550
2,500 US Bristol-Myers Squibb Co. 160,469
3,500 US Eli Lilly & Co. 232,750
850 US Genentech Inc. * 114,325
1,200 US Guidant Corp. * 56,400
1,200 US Johnson & Johnson 111,750
1,300 US Merck & Co. Inc. 87,181
2,400 US PE Biosystems Group 288,750
8,000 US Pfizer Inc. 259,500
1,100 US Pharmacia & Upjohn Inc. 49,500
900 US Sepracor Inc. * 89,269
4,000 US Warner Lambert Co. 327,750
-----------
2,306,194
-----------
INTEREST-SENSITIVE SECTOR 7.3%
BANKING 3.6%
4,000 US Bank of New York Inc. 160,000
6,000 US Citigroup Inc. 333,375
2,000 US Wells Fargo Co. 80,875
-----------
574,250
-----------
GENERAL FINANCE 1.2%
4,000 US Federal Home Loan Mortgage
Corp. 188,250
INSURANCE 2.5%
3,700 US American International Group
Inc. 400,062
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 6
<PAGE>
Dresdner RCM Large Cap Growth Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS (CONTINUED)
TECHNOLOGY SECTOR 36.9%
COMPUTERS/OFFICE EQUIPMENT 5.5%
1,500 US Dell Computer Corp. * $ 76,500
4,600 US E M C Corp. * 502,550
720 US Hewlett-Packard Co. 82,035
2,000 US International Business
Machines 216,000
-----------
877,085
-----------
ELECTRONICS/NEW TECHNOLOGY 22.5%
7,500 US Cisco Systems Inc. * 803,437
2,600 US Intel Corp. 214,013
1,830 US JDS Uniphase Corp. * 295,202
2,500 US Lucent Technologies Inc. 187,031
2,000 US Motorola Inc. 294,500
3,500 FI Nokia Corp. (ADR) 665,000
1,100 CA Nortel Networks Corp. 111,100
3,460 US QUALCOMM Inc. * 609,393
1,600 FR STMicroelectronics N.V. (NY
Registered Shares) 242,300
3,000 US Xilinx Inc. * 136,406
-----------
3,558,382
-----------
TECHNOLOGY SERVICES 8.9%
2,400 US America Online Inc. * 181,050
6,400 US Microsoft Corp. * 747,200
1,100 US Yahoo Inc. * 475,956
-----------
1,404,206
-----------
TELEMEDIA/SERVICES SECTOR 9.7%
COMMUNICATION SERVICES 7.1%
4,200 US GTE Corp. 296,362
9,150 US MCI WorldCom Inc. * 485,522
1,900 US Nextel Communications Inc. * 195,938
3,000 US SBC Communications Inc. 146,250
-----------
1,124,072
-----------
MEDIA 2.6%
3,000 US Clear Channel Communications * 267,750
2,000 US Time Warner Inc. 144,875
-----------
412,625
-----------
TOTAL EQUITY INVESTMENTS (COST $11,167,621) 97.6% 15,444,627
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 7
<PAGE>
Dresdner RCM Large Cap Growth Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS
MONEY MARKET FUNDS 3.3%
262,546 US SSgA Money Market Fund $ 262,546
262,546 US SSgA U.S. Government Money
Market Fund 262,546
-----------
TOTAL SHORT-TERM INVESTMENTS (COST $525,092) 3.3% 525,092
-----------
TOTAL INVESTMENTS (COST $11,692,713)** 100.9% 15,969,719
OTHER ASSETS LESS LIABILITIES (0.9)% (145,258)
-----------
NET ASSETS 100.0% $15,824,461
===========
</TABLE>
- --------------------------------
* Non-income producing security
ADR American Depository Receipt
Tax Information:
** For Federal income tax purposes, cost is $11,745,741 and gross aggregate
unrealized appreciation (depreciation) for all securities is as follows:
<TABLE>
<S> <C>
Unrealized appreciation $4,571,554
Unrealized depreciation (347,576)
---------
Net unrealized appreciation $4,223,978
=========
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Fund's investments in securities at December 31, 1999 categorized by
country:
<TABLE>
<CAPTION>
% OF NET ASSETS
-------------------------------
COUNTRY SHORT-TERM
COUNTRY CODE EQUITIES AND OTHER TOTAL
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------
Bermuda BH 3.3% 3.3%
Canada CA 0.7% 0.7%
Finland FI 4.2% 4.2%
France FR 1.5% 1.5%
United States US 87.9% 2.4% 90.3%
------ ------ -----
Total 97.6% 2.4% 100.0%
====== ====== =====
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 8
<PAGE>
Dresdner RCM Biotechnology Fund
Management's Performance Review
An early entry into genomics stocks just prior to their enthusiastic
discovery by Wall Street drove the Dresdner RCM Global Biotechnology Fund's
performance during 1999. For the year ended December 31, 1999, the Fund achieved
a total return of 111.39%, nearly equal to its benchmark, the AMEX Biotechnology
Index, which returned 111.44%.
MARKET REVIEW
During the year, the Dresdner RCM Biotechnology Fund concentrated on two
themes: therapeutic biotechnology (companies that develop new drugs) and
genomics (biotech companies that specialize in information behind the genetic
basis of disease and physiology). Biotechnology and genomics share a common
trait with the dot.com companies: unlimited and unquantifiable potential. Even
though the biotechnology sector nearly doubled in the second half of 1999, an
argument can be made that the stocks are still inexpensive. For instance, Amgen,
which markets two drugs, has a current market value of $63 billion. In
comparison, Millennium Pharmaceuticals, which is believed to have the potential
to generate many more products, has a market value of approximately $5 billion.
This ten-fold difference in absolute market value suggests the extent of the
opportunity.
As the presidential election cycle heats up, the pharmaceutical industry
is serving as a target for politicians. Congress has been debating the expansion
of Medicare to cover prescription drugs, and the health care industry continues
to be an issue in the presidential primaries. While the large cap pharmaceutical
companies are particularly vulnerable to potential action in Washington, D.C.,
the biotechnology and genomics companies produce niche products that would
likely not be affected by legislation.
FACTORS AFFECTING PERFORMANCE
At the end of 1999, the Fund no longer owned large capitalization
pharmaceutical companies, primarily because of the impact of the Medicare issue.
The largest capitalization holdings included Amgen and Genentech, two core
holdings of the Fund. Amgen's performance has historically been driven by
Epogen, the company's flagship product which generates red blood cell growth.
However, by mid-year, Amgen shifted from a mature company into a development
stage investment story with several new drugs treating prostate cancer,
rheumatoid arthritis, certain psychiatric illnesses and a kidney disorder.
Dresdner RCM used its Grassroots-SM- Research division to survey a select group
of kidney doctors and asked them how new guidelines from the National Kidney
Foundation regarding red blood cells would affect their utilitization of Amgen's
new therapy. The survey found that utilization was going to be significantly
higher than Wall Street anticipated. As a result, Dresdner RCM was able to
anticipate upside surprises in Amgen's financial performance. In addition, Amgen
is anticipating FDA approval of an improved version of Epogen early in 2000.
Another excellent performer during the year was Genentech, a company
that was spun off by Roche Holdings in July. According to Dresdner RCM's
valuation analyses, the stock appeared inexpensive based on the earnings
potential of Herceptin (their breast cancer drug), Rituxin (for lymphoma), as
well as other products for heart attack and asthma victims. A New England
Journal of Medicine editorial said that Genentech's asthma drug was the first
major step in 40 years that has been taken to treat the disease.
We believe that Dresdner RCM has a major advantage over many other
investment firms in the field of biotechnology research. The Fund's portfolio
managers have advanced degrees in medicine as well as extensive financial
training, which helps them to analyze new products and services from the
biotechnology sectors.
For instance, that background helped them understand the investment
merits of QLT Phototherapeutics, which has developed treatment that helps
ophthalmologists successfully treat macular degeneration, a disease affecting
2.5 million people in which retinal degradation leads to blindness. Using
photodynamic therapy, which utilizes light-activated drugs, the ophthalmologist
treats the disease by shining a specific frequency of light into the eye.
Other noteworthy therapeutic biotechnology companies held by the
portfolio during the year included IDEC Pharmaceuticals, which collaborated with
Genentech to produce Rituxin, and Medimmune, which manufactures Synegis, a drug
that treats a virus often contracted by premature babies. A recent study linked
Page 9
<PAGE>
Dresdner RCM Biotechnology Fund
Management's Performance Review
this virus in infants to the development of childhood asthma. If the study's
findings become conclusive, then the use of Synegis would be vastly expanded.
In the genomics area, Maxygen uses its proprietary technologies to mimic
the natural process of evolution, bringing together advances in molecular
biology and classical breeding. The company went public at $16 in mid-December,
ending the year at $71. The Fund also has significant positions in Abgenix and
Medarex, companies that produce monoclonal antibodies, which are essentially
very targeted therapies against a variety of diseases. Affymetrix is recognized
as a worldwide leader in the field of DNA chip technology. The company intends
to establish its GeneChip system as the platform of choice for acquiring,
analyzing and managing complex genetic information to improve diagnosis,
monitoring and treatment of disease.
OUTLOOK
Among the most attractive investments, in Dresdner RCM's view, continue
to be genomics companies, which it believes are likely to enjoy enormous price-
earnings multiple expansion based on their potential discoveries. It is likely
that the world of gene therapy will garner expanded news coverage later this
year when a company may actually succeed in cloning a human gene. In
biotechnology, Dresdner RCM believes these companies will likely get more
attention from investors as large capitalization pharmaceutical stocks continue
to sell off.
The Financial Accounting Standards Board's elimination of the pooling
method of accounting for mergers effective 2001 was originally feared to be a
negative because of its dilution of earnings. The alternative method, purchase
accounting, requires the acquirer to write off goodwill -- the excess purchase
price over tangible assets -- over a period of years. Genentech has led the way
in using purchase accounting to account for all of its acquisitions, causing the
company to report accounting losses but positive cash flow. Using Genentech as
an example, biotechnology investors seem to be more comfortable with the
purchase accounting methodology, properly focusing on cash flow and a company's
potential growth rather than accounting earnings. Therefore, the FASB rule
change will likely have little impact on the Fund.
Page 10
<PAGE>
Dresdner RCM Biotechnology Fund
Total Return Index Comparison(d)
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
$10,000 INVESTMENT (12/30/97 - 12/31/99)(E)
<S> <C> <C> <C>
Class N Shares NASDAQ Biotech Index (b) Russell 2000 Index (c)
12/31/1997 $10,000 $10,175 $10,071
1/31/1998 $10,260 $10,140 $9,912
2/28/1998 $10,490 $10,572 $10,644
3/31/1998 $10,590 $11,363 $11,083
4/30/1998 $10,470 $11,107 $11,144
5/31/1998 $10,350 $10,719 $10,543
6/30/1998 $10,040 $10,649 $10,565
7/31/1998 $10,110 $10,971 $9,710
8/30/1998 $7,930 $8,560 $7,824
9/30/1998 $9,110 $10,692 $8,437
10/31/1998 $9,880 $11,585 $8,781
11/30/1998 $10,560 $11,987 $9,241
12/31/1998 $11,776 $14,681 $9,813
1/31/1999 $12,383 $16,183 $9,943
2/28/1999 $11,776 $15,235 $9,138
3/31/1999 $11,518 $16,728 $9,281
4/30/1999 $11,261 $15,261 $10,112
5/31/1999 $11,436 $16,436 $10,260
6/30/1999 $12,795 $17,029 $10,724
7/31/1999 $13,289 $19,230 $10,430
8/31/1999 $15,049 $21,097 $10,044
9/30/1999 $15,049 $19,789 $10,046
10/31/1999 $15,605 $20,125 $10,087
11/30/1999 $17,416 $22,730 $10,689
12/31/1999 $24,893 $29,611 $11,899
<CAPTION>
$10,000 INVESTMENT (12/30/97 - 12/31/99)(E)
<S> <C>
AMEX Biotech Index (a)
12/31/1997 $10,042
1/31/1998 $9,734
2/28/1998 $9,936
3/31/1998 $10,791
4/30/1998 $10,830
5/31/1998 $9,971
6/30/1998 $9,079
7/31/1998 $8,531
8/30/1998 $6,462
9/30/1998 $8,618
10/31/1998 $10,146
11/30/1998 $10,116
12/31/1998 $11,446
1/31/1999 $12,147
2/28/1999 $10,931
3/31/1999 $11,558
4/30/1999 $11,817
5/31/1999 $12,434
6/30/1999 $13,252
7/31/1999 $15,487
8/31/1999 $16,619
9/30/1999 $15,626
10/31/1999 $16,245
11/30/1999 $17,812
12/31/1999 $24,196
</TABLE>
PERFORMANCE(D)
DECEMBER 31, 1999
<TABLE>
<CAPTION>
CUMULATIVE
SINCE SINCE
BIOTECHNOLOGY FUND 1 YEAR INCEPTION INCEPTION
<S> <C> <C> <C>
Class N
Average Annual Total Return(e) 111.39% 57.68% 148.93%
NASDAQ Biotech Index
Average Annual Total Return(b) 101.67% 71.95% 196.11%
Russell 2000 Index
Average Annual Total Return(c) 21.26% 9.07% 18.99%
AMEX Biotech Index
Average Annual Total Return(a) 111.44% 55.46% 141.96%
</TABLE>
The data above represents past performance of the Fund and may not
indicate future performance. The investment return and principal value of an
investment in the Fund will fluctuate, so that shares, when redeemed, may be
worth more or less than their original cost.
- --------------------------------
(a) The American Stock Exchange Biotechnology Index is an equal-dollar weighted
index that attempts to measure the performance of a cross section of
companies in the biotechnology industry that are primarily involved in the
use of biological processes to develop products or provide services. This
Index was developed with a base level of 200 stocks as of October 18, 1991.
(b) The NASDAQ Biotechnology Index is a capitalization-weighted index that
attempts to measure the performance of all NASDAQ stocks in the
biotechnology sector. This Index was developed with a base value of 200
stocks as of November 1, 1993.
(c) The Russell 2000 Index is composed of the 2,000 smallest securities in the
Russell 3000 Index, which is composed of the 3,000 largest U.S. companies
based on market capitalization and represents approximately 98% of the
investable U.S. equity market.
(d) Returns assume reinvestment of all dividends and capital gains
distributions at net asset value.
(e) The Class N shares began operations on December 30, 1997.
Page 11
<PAGE>
Dresdner RCM Biotechnology Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS
DRUGS AND HOSPITAL SUPPLIES 80.3%
3,400 US Abgenix Inc. * $ 450,500
2,400 US Affymetrix Inc. * 407,250
15,200 US Amgen Inc. * 912,950
19,000 US BioCryst Pharmaceuticals
Inc. * 560,500
2,200 US Biogen Inc. * 185,900
8,000 US Enzon Inc. * 347,000
7,300 US Genentech Inc. * 981,850
7,300 US Genzyme General Corp. * 328,500
8,000 US Guidant Corp. * 376,000
2,500 US Human Genome Sciences Inc. * 381,563
6,568 US IDEC Pharmaceuticals Corp. * 645,306
18,300 US ILEX Oncology Inc. * 441,488
8,000 US Incyte Pharmacuticals Inc. * 480,000
12,100 US Inhale Therapeutic Systems
Inc. * 515,006
10,000 US Maxygen Inc. * 710,000
16,500 US Medarex Inc. * 614,625
4,000 US Millennium Pharmaceuticals
Inc. * 488,000
2,500 US PE Biosystems Group 300,781
10,100 US Protein Design Labs Inc. * 707,000
12,000 CA QLT PhotoTherapeutics Inc. * 705,000
2,000 US Sepracor Inc. * 198,375
35,200 US Titan Pharmaceuticals Inc. * 668,800
15,300 US Vertex Pharmaceuticals Inc. * 535,500
-----------
11,941,894
-----------
HEALTH CARE SERVICES 4.4%
31,200 US MedicaLogic Inc. * 655,200
-----------
TOTAL EQUITY INVESTMENTS (COST $8,671,880) 84.7% 12,597,094
-----------
SHORT-TERM INVESTMENTS
MONEY MARKET FUNDS 9.1%
674,084 US SSgA Money Market Fund 674,084
674,083 US SSgA U.S. Government Money
Market Fund 674,083
-----------
TOTAL SHORT-TERM INVESTMENTS (COST $1,348,167) 9.1% 1,348,167
-----------
TOTAL INVESTMENTS (COST $10,020,047)** 93.8% 13,945,261
OTHER ASSETS LESS LIABILITIES 6.2% 924,836
-----------
NET ASSETS 100.0% $14,870,097
===========
</TABLE>
- --------------------------------
* Non-income producing security
The accompanying notes are an integral part of the financial statements.
Page 12
<PAGE>
Dresdner RCM Biotechnology Fund
Portfolio of Investments
December 31, 1999
Tax Information:
** For Federal income tax purposes, cost is $10,085,799 and gross aggregate
unrealized appreciation (depreciation) for all securities is as follows:
<TABLE>
<S> <C>
Unrealized appreciation $3,966,009
Unrealized depreciation (106,547)
----------
Net unrealized appreciation $3,859,462
==========
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Fund's investments in securities at December 31, 1999 categorized by
country:
<TABLE>
<CAPTION>
% OF NET ASSETS
------------------------------
COUNTRY SHORT-TERM
COUNTRY CODE EQUITIES AND OTHER TOTAL
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------
Canada CA 4.7% 4.7%
United States US 80.0% 15.3% 95.3%
------ ------- -----
Total 84.7% 15.3% 100.0%
====== ======= =====
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 13
<PAGE>
Dresdner RCM Tax Managed Growth Fund
Management's Performance Review
A continuing focus on telecommunications, the Internet and biotechnology
propelled the Dresdner RCM Tax Managed Growth Fund to return more than double
the performance of its benchmark. For the year ended December 31, 1999, the Fund
posted total returns of 52.44% and 52.04% for Class I and Class N shares,
respectively. In comparison, the S&P 500 Index returned 21.04%. These results
reflect pre-tax data, and do not take into account the relative tax efficiencies
of the Fund.
MARKET REVIEW
The stock market came on strong during the fourth quarter of 1999,
generating most of the gains for the year and making 1999 the fifth straight
year in which the S&P 500 Index rose by more than 20%. Strong advances in
corporate profits and benign inflation news continued to send stocks higher,
despite rising interest rates. Improving economic performance in Europe and
Japan was a welcome sign to American exporters, and actually caused many
international stock markets to outperform the S&P 500 Index. The dominance of
large cap over smaller cap stocks diminished during most of 1999, as investors
began to appreciate the valuation advantages offered by smaller companies.
Instead of a focus on market capitalization, the market was completely
dominated by gains in technology and telecommunications, making the recent
advance increasingly narrow. Interest-sensitive areas such as finance had a
difficult time performing. Even energy, with oil prices more than doubling,
produced modest returns. Pharmaceutical stocks were weighted down by
presidential politics, and international consumer products companies continued
to struggle, offering the Fund's management team the opportunity to harvest tax
losses.
FACTORS AFFECTING PERFORMANCE
Since the fourth quarter of 1999 was extremely strong for technology,
the Fund benefited greatly from summer purchases of QUALCOMM, which rose 272%
during the quarter, JDS Uniphase, which was up 183%, and Yahoo!, which rose
141%. QUALCOMM's technology for wireless communications has become the global
standard, while JDS Uniphase is benefiting from its role as a leading supplier
to companies building Internet infrastructure. Yahoo! has outperformed Wall
Street analyst expectations for growth in revenues and earnings. Dresdner RCM
used its Grassroots-SM- Research division to confirm Winstar Communications,
which provides wireless data and voice transmission, as an excellent investment
opportunity, and to gauge its preparedness for Y2K. The stock rose 93% in the
fourth quarter.
In the health care sector, biotechnology companies such as Amgen,
Genentech and Inhale Technologies performed very well. In contrast, the large
pharmaceutical companies continued to struggle as Congress debated the expansion
of Medicare to cover prescription drugs. Biotechnology companies are considered
less vulnerable to potential legislation partly because they tend to focus on
niche markets unlikely to be affected by price controls. For example, Inhale
Technologies has patented a device allowing diabetics -- who comprise all ages,
not just Medicare recipients -- to inhale rather than inject insulin.
Dresdner RCM believes that consumer non-durables companies such as
Coca-Cola and Nike are likely to benefit from the improving global economic
picture. However, their stock prices have not yet responded. Coca-Cola was
trimmed during the fourth quarter, helping the Fund realize a tax loss. The
stock was repurchased 55 days later after the company reported improved
performance and announced a management shakeup. The Fund's positions in Nike and
Tyco International were also trimmed in the fourth quarter, primarily to realize
tax losses.
Because income tax ramifications of any trade are a major consideration
for this Fund, Dresdner RCM routinely performs a "break-even" analysis to
determine whether a stock with large gains should be sold if it means incurring
a heavy tax burden. Although a company's investment merits outweigh tax
considerations, the portfolio may continue to hold shares if Dresdner RCM
remains confident in the company's strategy over the long term. In addition,
stocks selling below cost may be trimmed to generate tax losses in one year and
then be repurchased 31 days later to avoid IRS wash-sale rules. As a result of
these strategies, the portfolio is relatively concentrated, with investments in
46 companies as of December 31, 1999.
Page 14
<PAGE>
Dresdner RCM Tax Managed Growth Fund
Management's Performance Review
OUTLOOK
Dresdner RCM's management team expects to continue to give particular
focus to companies that are building Internet infrastructure, and thus expanding
the ability of businesses and individuals to use the Internet efficiently. A new
holding, NTT DoCoMo, summarizes four prevailing themes in the portfolio: the
search globally for quality growth companies, the Japanese recovery, wireless
communications and wireless access to the Internet.
The Fund also expects to continue its emphasis on health care companies,
since they are prolifically developing products that have a ready market with
America's aging population. Although congressional debate over the expansion of
Medicare is likely to be spirited during this election season, it could also
create an opportunity to buy pharmaceutical stocks at bargain prices.
The U.S. economy continues to exceed expectations, driven by consumer
confidence and the wealth effect created by the record-setting stock market. As
a result, the Federal Reserve Board is likely to raise short-term interest rates
to keep inflation at bay. So far, continued growth in corporate profits has
enabled the market to withstand rising interest rates, a trend Dresdner RCM
believes cannot continue indefinitely. Meanwhile, Asia and other global
economies continue to recover, which is a positive development for holdings with
significant international operations.
Page 15
<PAGE>
Dresdner RCM Tax Managed Growth Fund
Total Return Index Comparison(b)
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
$10,000 INVESTMENT (12/31/98 - 12/31/99)(C)(D)(E)
<S> <C> <C>
Class I Shares S&P 500 Stock Index (a)
12/31/1998 $10,000 $10,000
1/31/1999 $10,790 $10,418
2/28/1999 $10,510 $10,094
3/31/1999 $11,610 $10,498
4/30/1999 $11,500 $10,904
5/31/1999 $11,130 $10,647
6/30/1999 $12,130 $11,238
7/31/1999 $11,780 $10,887
8/31/1999 $11,860 $10,833
9/30/1999 $11,550 $10,536
10/31/1999 $12,240 $11,203
11/30/1999 $13,070 $11,430
12/31/1999 $15,244 $12,104
</TABLE>
PERFORMANCE(b)
DECEMBER 31, 1999
<TABLE>
<CAPTION>
CUMULATIVE
SINCE SINCE
TAX MANAGED GROWTH FUND 1 YEAR INCEPTION INCEPTION
<S> <C> <C> <C>
Class I
Average Annual Total Return(c) 52.44% 52.44% 52.44%
Class N
Average Annual Total Return(d) 52.04% 52.04% 52.04%
S&P 500 Stock Index
Average Annual Total Return(a) 21.04% 21.04% 21.04%
</TABLE>
The data above represents past performance of the Fund and may not
indicate future performance. The investment return and principal value of an
investment in the Fund will fluctuate, so that shares, when redeemed, may be
worth more or less than their original cost.
- --------------------------------
(a) The Standard & Poor's 500 Stock Index is a capitalization-weighted index of
500 stocks that attempts to measure performance of the board domestic
economy through changes in the aggregate market value of 500 stocks
representing major industries.
(b) Returns assume reinvestment of all dividends and capital gains
distributions at net asset value.
(c) The Class I shares commenced operations on December 31, 1998.
(d) The Class N shares commenced operations on February 12, 1999. Prior to
February 12, 1999, figures reflect Class I performance.
(e) The value of a $10,000 investment for Class N is $15,204 for the period
from 12/31/98 - 12/31/99. The performance of the Class N shares is lower
than Class I shares due to the effects of 12b-1 fees.
Page 16
<PAGE>
Dresdner RCM Tax Managed Growth Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS
CONSUMER NON-DURABLES SECTOR 15.7%
BEVERAGE/TOBACCO 1.3%
500 US Coca Cola Co. $ 29,125
HOUSEHOLD/RELATED NON-DURABLES 4.3%
1,150 US Estee Lauder Cos. Inc.
(Class A) 58,003
1,000 US Scotts Co. (Class A) * 40,250
----------
98,253
----------
LEISURE TIME PRODUCTS/SERVICES 3.9%
500 US Harley Davidson Inc. 32,031
1,400 US McDonalds Corp. 56,438
----------
88,469
----------
RETAIL TRADE 6.2%
550 US Costco Cos. Inc. * 50,187
500 US Kohl's Corp. * 36,094
250 US Nike Inc. (Class B) 12,391
1,400 US Walgreen Co. 40,950
----------
139,622
----------
CYCLICAL/CAPITAL GOODS SECTOR 7.1%
ELECTRICAL EQUIPMENT 4.0%
575 US General Electric Co. 88,981
INDUSTRIAL EQUIPMENT 1.9%
1,100 BH Tyco International Ltd. 42,763
TRANSPORTATION SERVICES 1.2%
400 US United Parcel Service Inc.
(Class B) 27,600
ENERGY SECTOR 3.1%
ENERGY 3.1%
600 US Enron Corp. 26,625
1,100 US Weatherford International Inc. 43,931
----------
70,556
----------
HEALTH CARE SECTOR 16.1%
DRUGS AND HOSPITAL SUPPLIES 14.7%
1,400 US Amgen Inc. * 84,087
700 US Bristol-Myers Squibb Co. 44,931
700 US Eli Lilly & Co. 46,550
150 US Genentech Inc. * 20,175
250 US Guidant Corp. * 11,750
350 US Inhale Therapeutic Systems
Inc. * 14,897
300 US Johnson & Johnson 27,938
600 US Pfizer Inc. 19,463
750 US Warner Lambert Co. 61,453
----------
331,244
----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 17
<PAGE>
Dresdner RCM Tax Managed Growth Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS (CONTINUED)
HEALTH CARE SERVICES 1.4%
400 US CareInsite Inc. * $ 32,200
INTEREST-SENSITIVE SECTOR 3.7%
GENERAL FINANCE 0.7%
450 US Charles Schwab Corp. 17,269
INSURANCE 3.0%
400 US American International Group
Inc. 43,250
250 US Marsh & McLennan Cos. Inc. 23,922
----------
67,172
----------
TECHNOLOGY SECTOR 32.2%
COMPUTERS/OFFICE EQUIPMENT 3.0%
600 US Hewlett-Packard Co. 68,362
ELECTRONICS/NEW TECHNOLOGY 19.0%
1,050 US Cisco Systems Inc. * 112,481
550 US Intel Corp. 45,272
300 US JDS Uniphase Corp. * 48,394
800 FI Nokia Corp. (ADR) 152,000
400 US QUALCOMM Inc. * 70,450
----------
428,597
----------
TECHNOLOGY SERVICES 10.2%
900 US Microsoft Corp. * 105,075
250 US Oracle Corp. * 28,016
150 US VERITAS Software Corp. * 21,469
175 US Yahoo Inc. * 75,720
----------
230,280
----------
TELEMEDIA/SERVICES SECTOR 18.9%
BUSINESS SERVICES 2.8%
1,400 US Pittway Corp. (Class A) 62,737
COMMUNICATION SERVICES 12.2%
600 US Global TeleSystems Group
Inc. * 20,775
1,425 US MCI WorldCom Inc. * 75,614
300 DE NTT Mobile Communications
Network Inc. (ADR) 59,700
1,000 US Qwest Communications
International Inc. * 43,000
1,000 UK Vodafone AirTouch PLC (ADR) 49,500
350 US WinStar Communications Inc. * 26,338
----------
274,927
----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 18
<PAGE>
Dresdner RCM Tax Managed Growth Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS (CONTINUED)
MEDIA 3.9%
500 US Clear Channel Communications * $ 44,625
600 US Time Warner Inc. 43,462
----------
88,087
----------
TOTAL EQUITY INVESTMENTS (COST $1,571,052) 96.8% 2,186,244
----------
SHORT-TERM INVESTMENTS
MONEY MARKET FUNDS 1.0%
11,074 US SSgA Money Market Fund 11,074
11,075 US SSgA U.S. Government Money
Market Fund 11,075
----------
TOTAL SHORT-TERM INVESTMENTS (COST $22,149) 1.0% 22,149
----------
TOTAL INVESTMENTS (COST $1,593,201)** 97.8% 2,208,393
OTHER ASSETS LESS LIABILITIES 2.2% 49,949
----------
NET ASSETS 100.0% $2,258,342
==========
</TABLE>
- --------------------------------
* Non-income producing security
ADR American Depository Receipt
Tax Information:
** For Federal income tax purposes, cost is $1,597,644 and gross aggregate
unrealized appreciation (depreciation) for all securities is as follows:
<TABLE>
<S> <C>
Unrealized appreciation $635,428
Unrealized depreciation (24,679)
--------
Net unrealized appreciation $610,749
========
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Fund's investments in securities at December 31, 1999 categorized by
country:
<TABLE>
<CAPTION>
% OF NET ASSETS
-------------------------------
COUNTRY SHORT-TERM
COUNTRY CODE EQUITIES AND OTHER TOTAL
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------
Bermuda BH 1.9% 1.9%
Finland FI 6.7% 6.7%
Germany DE 2.7% 2.7%
United Kingdom UK 2.2% 2.2%
United States US 83.3% 3.2% 86.5%
------ ------ -----
Total 96.8% 3.2% 100.0%
====== ====== =====
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 19
<PAGE>
Dresdner RCM Global Small Cap Fund
Management's Performance Review
A focus on bottom-up research and the foresight to invest early in
Japanese technology companies helped boost the Dresdner RCM Global Small Cap
Fund to triple-digit returns in 1999. For the year ended December 31, 1999, the
Fund achieved total returns of 104.63% and 104.06% for the Class I and Class N
shares, respectively. In comparison, the Fund's benchmark, the Salomon Smith
Barney Extended Market Index, produced a modest return of 17.27%. For the two
and three year annualized periods, the Fund's performance ranked it first among
its peer group of 39 and 31 global small-cap funds, respectively as reported by
Lipper Analytical Inc.
MARKET REVIEW
In 1999, small-cap stocks began to perform better throughout the world,
although at different times and to varying degrees. The small cap market in
Japan bottomed in late 1998, and sustained the strongest performance, with the
JASDAQ Index up more than 200% in 1999. The U.S. small cap sector, which had
been in a bear market during 1998, began to perform better in the second quarter
of 1999, as investors finally took note of the valuation disparity between
small-cap and large-cap stocks. In Europe, the formation of Euroland in 1999 has
favored large-cap stocks as investors placed a priority on liquidity, although
European small-cap stocks began to show some life at the end of the year as the
currency stabilized.
FACTORS AFFECTING PERFORMANCE
Two primary factors helped the Fund remain the number one Lipper fund in
its category for the third year in a row. First, Dresdner RCM has embraced
technology regardless of market cap size or geographical location, recognizing
the power of the Internet as a long-term global phenomenon, not just a
speculative bubble. Exciting technology companies dot the global landscape,
including BackWeb Technologies, an Israeli company that has developed a method
to enhance the breadth and quality of e-mail; Allaire Corp., a U.S. concern that
helps clients adapt their information systems to the Internet; and Baltimore
Technologies, a U.K.-based company that specializes in Internet security.
Dresdner RCM's Grassroots-SM- Research division confirmed the superiority of
Baltimore Technologies' products as well as the fact that companies need systems
that allow them to protect their data as well as to secure Internet
transactions. At year-end 1999, about half of the Dresdner RCM Global Small Cap
Fund portfolio was invested in the technology sector around the world, about
three times the benchmark weighting.
Another reason for the Fund's strong performance is that Dresdner RCM
was early in recognizing the small cap rally in Japan. In many cases, these
stocks appreciated as much as 500% during 1999. A positive factor of the Fund,
was management's willingness to allow very successful companies whose shares are
in high demand, to remain in the portfolio during the powerful rally, even
though they no longer fit market capitalization constraints.
To be sure, there were non-tech success stories in the portfolio as
well. Those include Charles Voegele Holding AG, a Swiss retailer, ELMOS
Semiconductor AG, a supplier to the automobile industry, Inhale Therapeutics, a
U.S. biotechnology company that has developed new ways to deliver drug
therapies, Danubius Hotel and Spa Resort, one of Hungary's leading hotel chains,
and Giordano International, a Hong Kong-based clothing retailer that has seen
profits soar as the Asian economies recovered.
Although the companies in the Fund are scattered throughout the world,
Dresdner RCM believes that it is critical to meet with management before making
an investment. In Denmark, H Lundbeck A/S, which specializes in manufacturing
anti-depressants including top-selling Cipramil, was perceived as risky by some
investors because it lacked a diversified portfolio of products. However, an
in-person meeting confirmed that the company remains tightly focused from a
marketing and R&D standpoint on its core competency, namely drugs that alleviate
mental illness.
Often, Dresdner RCM invests in companies that are discovered as a result
of the firm's analytical work in another market capitalization segment. The
firm's analysts are organized by sector, and they are encouraged to find
opportunities anywhere in the world within their sector, regardess of market
capitalization. For instance, the investment in Elcoteq Network, a subcontractor
to Nokia that manufactures millions of phones each year for the giant
Page 20
<PAGE>
Dresdner RCM Global Small Cap Fund
Management's Performance Review
wireless communications company, arose from such research, and highlights the
advantages inherent in a firm with global resources such as Dresdner RCM.
OUTLOOK
Dresdner RCM remains positive on global small-cap stocks, particularly
in Japan where small companies are helping to lead that country out of a decade-
long recession. In the U.S., small cap companies could be the primary engine of
growth in an economy that may be slowed by the Federal Reserve Board. In Europe,
weakness in the currency appears to have ended, but small caps are still
challenged by the desire of fund managers to own large blue chip names. Finally,
the Y2K cloud over emerging markets may have been replaced by investor concerns
over rising interest rates. Regardless of the macroeconomic environment,
Dresdner RCM will continue to invest in high-quality small cap growth stocks
using bottom-up analysis, a formula that has produced consistent results.
Page 21
<PAGE>
Dresdner RCM Global Small Cap Fund
Total Return Index Comparison(c)
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
$10,000 INVESTMENT (12/31/96 - 12/31/99)(D)(E)(F)
<S> <C> <C> <C>
Class I Shares Salomon EMI (a) MSCI World Small Cap (b)
12/31/96 10,000 10,000 10,000
1/31/97 10,290 10,021 10,061
2/28/97 10,010 10,005 10,043
3/31/97 9,410 9,665 9,608
4/30/97 9,320 9,620 9,402
5/31/97 10,730 10,370 10,309
6/30/97 11,750 10,689 10,627
7/31/97 12,280 10,978 10,768
8/31/97 12,320 10,846 10,491
9/30/97 13,260 11,313 10,757
10/31/97 12,440 10,838 10,193
11/30/97 12,410 10,645 9,723
12/31/97 12,548 10,647 9,431
1/31/98 12,446 10,711 9,613
2/28/98 13,827 11,501 10,449
3/31/98 15,071 11,980 10,739
4/30/98 15,705 12,039 10,810
5/31/98 15,388 11,799 10,536
6/30/98 15,784 11,645 10,270
7/31/98 15,524 11,152 9,784
8/31/98 12,197 9,366 8,160
9/30/98 12,096 9,589 8,143
10/31/98 12,707 10,162 8,717
11/30/98 14,144 10,599 9,183
12/31/98 14,968 11,084 9,376
1/31/99 15,101 11,023 9,383
2/28/99 14,049 10,528 8,960
3/31/99 14,375 10,756 9,284
4/30/99 15,065 11,461 9,990
5/31/99 15,065 11,393 9,869
6/30/99 17,134 11,854 10,413
7/31/99 17,461 11,868 10,664
8/31/99 18,018 11,724 10,704
9/30/99 18,586 11,553 10,673
10/31/99 19,736 11,692 10,538
11/30/99 25,471 12,212 10,986
12/31/99 30,630 13,001 11,753
</TABLE>
PERFORMANCE(c)
DECEMBER 31, 1999
<TABLE>
<CAPTION>
CUMULATIVE
SINCE SINCE
GLOBAL SMALL CAP FUND 1 YEAR 3 YEARS INCEPTION INCEPTION
<S> <C> <C> <C> <C>
Class I
Average Annual Total Return(d) 104.63% 45.23% 45.23% 206.30%
Class N
Average Annual Total Return(e) 104.06% 45.09% 45.09% 205.45%
Salomon EMI
Average Annual Total Return(a) 17.27% 9.14% 9.14% 30.01%
MSCI World Small Cap
Average Annual Total Return(b) 25.38% 5.53% 5.53% 17.53%
</TABLE>
The data above represents past performance of the Fund and may not
indicate future performance. The investment return and principal value of an
investment in the Fund will fluctuate, so that shares, when redeemed, may be
worth more or less than their original cost.
- --------------------------------
(a) The Salomon Brothers Extended Market Index ("EMI") is a component of the
Salomon Brothers Broad Market Index ("BMI") which includes listed shares of
5,409 companies with total available market capitalizations of at least the
local equivalent of US$100 million on the last business day of May each
year. The BMI consists of two components: the Primary Market Index ("PMI")
is the large capitalization stock component and the EMI is the small
capitalization stock component. The PMI universe is defined as those stocks
falling within the top 80% of the cumulative available capital level in
each country. The EMI includes the bottom 20% of the cumulative available
capital level in each country.
(b) The Morgan Stanley Capital International ("MSCI") World Global Small Cap
Index is a market capitalization weighted index composed of companies
representative of the market structure of 22 developed market countries in
North America, Europe, and the Asia/Pacific region. The Index is created by
selecting companies within the market capitalization range of US$200 - $800
million. The Index aims to represent 40% of the Small Cap universe within
each country by capturing 40% of each industry. The Index is calculated
without dividends, with net or with gross dividends reinvested, in both
U.S. Dollars and local currencies.
(c) Returns assume reinvestment of all dividends and capital gains
distributions at net asset value.
(d) Returns through December 31, 1998 reflect Rule 12b-1 fees. On that date,
all Fund shares were redesignated as Class I shares, which do not pay
Rule 12b-1 fees. Performance results for periods after December 31, 1998
will not reflect Rule 12b-1 fees.
(e) Class N shares were first issued on March 10, 1999, and pay Rule 12b-1
fees. Class N returns through December 31, 1998 are based on Class I
returns and reflect Rule 12b-1 fees.
(f) The value of a $10,000 investment for Class N is $30,545 for the period
from 12/31/96 - 12/31/99. The performance of the Class N shares is lower
than Class I shares due to the effects of 12b-1 fees.
Page 22
<PAGE>
Dresdner RCM Global Small Cap Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS
CONSUMER DURABLES SECTOR 0.6%
AUTOMOTIVE RELATED 0.6%
40,800 IT Magneti Marelli * $ 155,768
CONSUMER NON-DURABLES SECTOR 7.8%
BEVERAGE/TOBACCO 0.5%
6,200 FR Remy Cointreau S.A. * 139,401
FOOD/FOOD PROCESSING 2.3%
6,240 JP Hokuto Corp. 335,103
4,000 JP Q'sai Co. Ltd. 250,416
------------
585,519
------------
LEISURE TIME PRODUCTS/SERVICES 0.6%
7,700 HG Danubius Hotel and Spa Rt. * 140,080
RETAIL TRADE 4.4%
1,400 CH Charles Voegele Holding AG * 251,476
150,000 HK Giordano International Ltd. 154,371
6,000 JP Homac Corp. 167,270
6,500 US InterTAN Inc. * 169,812
19,300 US Trans World Entertainment
Corp. * 202,650
4,600 US Tweeter Home Entertainment
Group Inc. * 163,300
------------
1,108,879
------------
CYCLICAL/CAPITAL GOODS SECTOR 5.5%
CHEMICALS/TEXTILES 1.9%
4,000 JP Taiyo Ink Manufacturing Co.
Ltd. 469,529
INDUSTRIAL EQUIPMENT 2.6%
7,200 DE Steag Hamatech AG * 261,105
8,800 NO Tomra Systems ASA 149,460
1,460 DK Vesta Wind Systems A/S * 259,025
------------
669,590
------------
RAW/BASIC MATERIALS 1.0%
11,900 SE Granges AB 248,500
ENERGY SECTOR 2.2%
ENERGY 2.2%
10,200 US BJ Services Co. * 426,487
8,900 US National-Oilwell Inc. * 139,619
------------
566,106
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 23
<PAGE>
Dresdner RCM Global Small Cap Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS (CONTINUED)
HEALTH CARE SECTOR 6.5%
DRUGS AND HOSPITAL SUPPLIES 4.5%
7,800 DK H Lundbeck A/S $ 311,626
6,000 US Inhale Therapeutic Systems
Inc. * 255,375
2,400 US Invitrogen Corp. * 144,000
3,000 JP Japan Medical Dynamic
Marketing Inc. 140,859
4,200 UK Shire Pharmaceuticals Group
PLC (ADR) * 122,325
9,700 US Titan Pharmaceuticals Inc. * 184,300
------------
1,158,485
------------
HEALTH CARE SERVICES 2.0%
4,800 US eBenX Inc. * 217,200
13,600 US MedicaLogic Inc. * 285,600
------------
502,800
------------
INTEREST-SENSITIVE SECTOR 2.5%
GENERAL FINANCE 1.5%
14,000 JP Japan Asia Investment Co. Ltd. 230,070
5,000 JP Mycal Card Inc. 158,955
------------
389,025
------------
INSURANCE 1.0%
9,900 US InsWeb Corp. * 253,069
TECHNOLOGY SECTOR 52.8%
COMPUTERS/OFFICE EQUIPMENT 3.7%
2,700 US DSP Group Inc. * 251,100
6,000 US Pinnacle Systems Inc. * 244,125
4,000 JP Yamada Denki Co. Ltd. 434,315
------------
929,540
------------
ELECTRONICS/NEW TECHNOLOGY 16.1%
11,200 US Advanced Energy Industries
Inc. * 551,600
1,400 DE Aixtron AG 197,158
3,600 US Carrier Access Corp. * 242,325
20,500 US Cypress Semiconductor Corp. * 663,688
14,700 US Digital Microwave Corp. * 344,531
8,200 FI Elcoteq Network (Class A) 125,556
6,700 DE ELMOS Semiconductor AG (144A)
* 276,719
4,100 UK Filtronic PLC 139,026
5,500 US GlobeSpan Inc. * 358,188
20,200 FI JOT Automation Group Oyj 188,223
6,000 JP Moritex Corp. 293,456
12,400 FI Perlos Oyj * 437,190
1,800 JP Tokyo Seimitsu Co. Ltd. 290,521
------------
4,108,181
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 24
<PAGE>
Dresdner RCM Global Small Cap Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS (CONTINUED)
TECHNOLOGY SERVICES 33.0%
7,500 US Actuate Corp. * $ 321,562
4,800 US Allaire Corp. * 702,300
4,200 JP ARGOTECHNOS 21 Corp. 266,223
3,300 US Art Technology Group Inc. * 422,812
4,510 JP Aucnet Inc. 270,432
7,200 UK Autonomy Corp. PLC * 349,200
6,000 IS BackWeb Technologies Ltd. * 252,750
3,100 UK Baltimore Technologies PLC
(ADR) * 272,800
3,600 US BindView Development Corp. * 178,875
15,900 CA Chapters Online Inc. (144A) * 219,980
1,280 CH Distefora Holding AG * 311,117
6,600 US Exchange Applications Inc. * 368,775
1,650 CH Fantastic Corp. (144A) * 312,480
2,400 SE Framtidsfabriken AB 434,824
2,400 DE Freenet.de AG * 265,457
6,900 SE Icon Medialab International AB
* 240,282
800 IN Infosys Technologies Ltd.
(ADR) 264,000
1,900 JP Internet Initiative Japan Inc.
(ADR) * 184,656
4,200 US Mission Critical Software Inc.
* 294,000
1,900 JP Nippon System Development 276,925
2,200 SG Pacific Internet Ltd. * 103,263
4,100 UK Psion PLC 172,127
15,900 UK Sports Internet Group PLC * 177,149
1,700 JP Trans Cosmos Inc. 725,032
2,500 JP Trend Micro Inc. 630,930
7,100 US TSI International Software
Ltd. * 402,037
------------
8,419,988
------------
TELEMEDIA/SERVICES SECTOR 17.9%
BUSINESS SERVICES 5.4%
800 FR Altran Technologies S.A. 483,528
1,200 DE I-D Media AG * 74,342
14,400 SE Mandator AB 215,153
14,000 US Telescan Inc. * 345,625
24,800 NL Vedior N.V. 254,819
------------
1,373,467
------------
COMMUNICATION SERVICES 8.7%
22,700 US Allied Riser Communications
Corp. * 469,606
1,800 US High Speed Access Corp. * 31,725
14,200 US Intermedia Communications of
Florida Inc. * 551,137
14,500 IS Partner Communications Co.
Ltd. (ADR) * 375,188
4,600 US SoftNet Systems Inc. * 115,575
8,300 NL Versatel Telecom International
N.V. * 292,635
9,500 US Z-Tel Technologies Inc. * 383,563
------------
2,219,429
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 25
<PAGE>
Dresdner RCM Global Small Cap Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS (CONTINUED)
MEDIA 3.8%
1,800 DE EM.TV & Merchandising AG $ 116,047
4,600 US Entercom Communications Corp.
* 303,600
10,400 UK NDS Group PLC (ADR) * 317,200
17,100 US Tickets.com Inc. * 244,744
------------
981,591
------------
TOTAL EQUITY INVESTMENTS (COST $18,044,379) 95.8% 24,418,947
------------
SHORT-TERM INVESTMENTS
MONEY MARKET FUNDS 3.5%
448,503 US SSgA Money Market Fund 448,503
448,503 US SSgA U.S. Government Money
Market Fund 448,503
------------
TOTAL SHORT-TERM INVESTMENTS (COST $897,006) 3.5% 897,006
------------
TOTAL INVESTMENTS (COST $18,941,385)** 99.3% 25,315,953
OTHER ASSETS LESS LIABILITIES 0.7% 187,273
------------
NET ASSETS 100.0% $ 25,503,226
============
</TABLE>
- --------------------------------
* Non-income producing security
ADR American Depository Receipt
144A Security is purchased pursuant to Rule 144A of the Securities Act of 1933
and may be resold only to qualified institutional buyers.
The accompanying notes are an integral part of the financial statements.
Page 26
<PAGE>
Dresdner RCM Global Small Cap Fund
Portfolio of Investments
December 31, 1999
Tax Information:
** For Federal income tax purposes, cost is $19,053,757 and gross aggregate
unrealized appreciation (depreciation) for all securities is as follows:
<TABLE>
<S> <C>
Unrealized appreciation $6,535,092
Unrealized depreciation (272,896)
----------
Net unrealized appreciation $6,262,196
==========
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Fund's investments in securities at December 31, 1999 categorized by
country:
<TABLE>
<CAPTION>
% OF NET ASSETS
-------------------------------
COUNTRY SHORT-TERM
COUNTRY CODE EQUITIES AND OTHER TOTAL
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------
Canada CA 0.9% 0.9%
Denmark DK 2.2% 2.2%
Finland FI 2.9% 2.9%
France FR 2.4% 2.4%
Germany DE 4.7% 4.7%
Hong Kong HK 0.6% 0.6%
Hungary HG 0.6% 0.6%
India IN 1.0% 1.0%
Israel IS 2.5% 2.5%
Italy IT 0.6% 0.6%
Japan JP 20.1% 20.1%
Netherlands NL 2.2% 2.2%
Norway NO 0.6% 0.6%
Singapore SG 0.4% 0.4%
Sweden SE 4.5% 4.5%
Switzerland CH 3.4% 3.4%
United Kingdom UK 6.1% 6.1%
United States US 40.1% 4.2% 44.3%
------ ------ -----
Total 95.8% 4.2% 100.0%
====== ====== =====
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 27
<PAGE>
Dresdner RCM Global Technology Fund
Management's Performance Review
An explosive fourth quarter capped a stunning year for
technology-related stocks throughout the world, leaving virtually all other
industries and sectors far behind. For the year ended December 31, 1999, the
Dresdner RCM Global Technology Fund achieved total returns of 182.95% and
182.58% for the Class I and Class N shares, respectively. By comparison, the
Lipper Science & Technology Index, the Fund's benchmark, returned 113.90% while
the broad-based S&P 500 Index rose 21.04%.
MARKET REVIEW
In the past three decades, Dresdner RCM has witnessed a variety of
different market environments for technology, including many years when
technology was out of favor. However, the Fund's portfolio managers viewed the
1999 market environment for technology as one of the brightest.
Dresdner RCM believes this is because the Internet has proven to be the
most profound change in the economy since the industrial revolution. The demand
for wireless communications around the world continues to soar, particularly as
global economies improve, while the capacity for semiconductors to compress data
into smaller and smaller microchips has increased 100-fold in recent years. This
confluence of Internet, communications and microchip power increasingly occurred
in 1999.
To reach the Internet's vast potential requires unprecedented
connectivity bandwidth, which has not kept up with demand. Companies that can
provide this bandwidth, through technologies such as fiber-optical networking,
have enormous profit potential. A tremendous amount of equipment will be needed
to handle that additional traffic, as well as semiconductor chips and storage
capability, not to mention software for Web design or security for e-commerce
transactions. The companies that can satisfy these demands will do well.
Companies in more traditional industries such as advertising, broadcasting and
financial services have also directly benefited from the tremendous growth in
this new environment.
To be sure, unprecedented opportunity has been met with unprecedented
valuations. Stocks that sell at price-earnings ratios above 100 no longer raise
many eyebrows. At the same time, baby boom investors see retirement over the
horizon, and many believe that investing in technology is a way to achieve their
financial goals. This demand is helping to drive up valuations, despite 1999's
rising interest rate environment -- typically a negative for non-dividend paying
long-duration assets such as technology stocks.
FACTORS AFFECTING PERFORMANCE
A number of holdings in the portfolio experienced fantastic appreciation
during 1999. JDS Uniphase, the largest optical networking component company in
the world, has developed laser technology and packaging that plays an important
role in the telecommunications industry's ability to increase the capacity of
traffic carried over fiber-optic networks. QUALCOMM, the leader in digital
wireless technology, soared on acknowledgement of its market leadership. Strong
subscriber growth, higher-than-expected chip sales, higher than expected
royalties, and divestiture of its handset business all contributed to the
stock's appreciation. Additionally, as investors recognized wireless as an
eventual platform for Internet access, QUALCOMM'S Code Division Multiple Access
(CDMA) technology was recognized as the leader in that market.
The Fund's international exposure peaked in the third quarter and
declined as the year drew to a close, primarily due to a decision to sell a
number of holdings in Japan where it was believed that valuations had become
overextended. However, technology continues to be the primary driver in the
restructuring of the Japanese economy. Indeed, technology exposure outside the
U.S. will continue to be a significant theme of the Fund. Both these points are
illustrated by Yahoo! Japan, one of the first Internet portals in Japan, which
is catching the Internet wave in that country in its infancy. The company
continues to be an exciting story in terms of management's ability to learn from
the U.S. experience with Internet commerce, retailing and advertising.
Overall Dresdner RCM was able to successfully navigate the ups and downs
of the domestic Internet sector during the year by being positioned in high
growth companies. Examples of these types of companies are Exodus
Communications, an Internet-hosting provider;
Page 28
<PAGE>
Dresdner RCM Global Technology Fund
Management's Performance Review
and Freeserve, a U.K.-based portal company that provides free Internet access
and a variety of U.K.-focused content.
Within the computer memory storage management group, companies such as
EMC, Network Appliance and VERITAS Software performed very well, all
beneficiaries of the explosion in data traffic and the reduction in disk drive
prices.
Considering the Fund's performance in 1999, there were some
disappointments. In a few instances, the Fund sold stocks too soon due to
valuation concerns, only to watch them continue to appreciate. Another example
of a disappointment in the portfolio was Tyco International, which
underperformed as a result of questions surrounding the company's method of
accounting for acquisitions. Yet, the company generates tremendous cash flow
from strong business lines, and demonstrates solid fundamentals.
OUTLOOK
While technology stocks continue to offer significant growth potential,
they are trading at unprecedented valuations, a concern the Fund's portfolio
managers struggle with every day. Fundamentals, rather than fear or exuberance,
will continue to drive Dresdner RCM's investment decisions. In the search to
uncover leading companies with great franchises positioned anywhere in the
world, management will continue to stress the successful themes identified in
the second half of 1999, including optical networking, storage management,
wireless communications and Internet infrastructure.
Page 29
<PAGE>
Dresdner RCM Global Technology Fund
Total Return Index Comparison(c)
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
$10,000 INVESTMENT (12/27/95-12/31/99) (D)(E)(F) CLASS I SHARES S&P 500 LIPPER SCIENCE
STOCK INDEX(A) & TECHNOLOGY
FUND INDEX(B)
<S> <C> <C> <C>
12/95 $10,000 $10,000 $10,000
12/95 $10,040 $9,952 $10,023
1/96 $10,370 $9,897 $10,364
2/96 $10,660 $10,314 $10,460
3/96 $10,620 $9,857 $10,561
4/96 $11,580 $10,840 $10,717
5/96 $11,930 $11,098 $10,993
6/96 $11,380 $10,332 $11,035
7/96 $10,270 $9,565 $10,547
8/96 $10,770 $10,055 $10,770
9/96 $11,870 $10,987 $11,376
10/96 $11,700 $10,822 $11,690
11/96 $12,770 $11,837 $12,573
12/96 $12,692 $11,626 $12,324
1/97 $13,689 $12,542 $13,095
2/97 $12,359 $11,408 $13,197
3/97 $11,564 $10,549 $12,654
4/97 $11,715 $11,007 $13,410
5/97 $13,447 $12,317 $14,226
6/97 $13,860 $12,432 $14,864
7/97 $15,694 $14,157 $16,047
8/97 $15,764 $14,245 $15,148
9/97 $17,094 $14,849 $15,978
10/97 $15,986 $13,279 $15,445
11/97 $15,754 $13,166 $16,160
12/97 $16,129 $12,537 $12,578
1/98 $15,976 $12,759 $12,801
2/98 $17,837 $14,277 $14,324
3/98 $18,838 $14,394 $14,442
4/98 $20,452 $15,012 $15,061
5/98 $19,227 $13,911 $13,957
6/98 $21,065 $14,727 $14,775
7/98 $20,441 $14,588 $14,636
8/98 $17,095 $11,850 $11,889
9/98 $17,790 $13,248 $13,292
10/98 $19,463 $14,259 $14,306
11/98 $22,055 $15,858 $15,910
12/98 $25,891 $18,423 $18,484
1/99 $29,859 $22,018 $20,877
2/99 $26,956 $21,333 $18,698
3/99 $30,210 $22,186 $20,603
4/99 $31,807 $23,045 $20,861
5/99 $30,634 $22,501 $20,831
6/99 $34,166 $23,750 $23,538
7/99 $34,765 $23,009 $23,530
8/99 $37,103 $22,894 $24,825
9/99 $40,043 $22,267 $25,162
10/99 $46,141 $23,676 $27,812
11/99 $56,565 $24,157 $31,936
12/99 $73,499 $25,580 $39,537
</TABLE>
PERFORMANCE(c)
DECEMBER 31, 1999
<TABLE>
<CAPTION>
CUMULATIVE
SINCE SINCE
GLOBAL TECHNOLOGY FUND 1 YEAR 3 YEARS INCEPTION INCEPTION
<S> <C> <C> <C> <C>
Class I
Average Annual Total Return(d) 182.95% 79.58% 64.43% 634.99%
Class N
Average Annual Total Return(e) 182.58% 79.50% 64.38% 634.06%
Lipper Science & Technology
Fund Index
Average Annual Total Return(b) 113.90% 50.22% 40.88% 295.37%
S&P 500 Stock Index
Average Annual Total Return(a) 21.04% 27.56% 26.39% 155.80%
</TABLE>
The data above represents past performance of the Fund and may not
indicate future performance. The investment return and principal value of an
investment in the Fund will fluctuate, so that shares, when redeemed, may be
worth more or less than their original cost.
- --------------------------------
(a) The Standard & Poor's 500 Stock Index is a capitalization-weighted index of
500 stocks that attempts to measure performance of the broad domestic
economy through changes in the aggregate market value of 500 stocks
representing major industries.
(b) The Lipper Science & Technology Fund Index is an equally weighted index of
the 10 largest U.S. science and technology mutual funds.
(c) Returns assume reinvestment of all dividends and capital gains
distributions at net asset value.
(d) The Class I shares commenced operations on December 27, 1995.
(e) Class N shares were first issued on January 20, 1999, and pay Rule 12b-1
fees, Class N returns through December 31, 1998 are based on Class I
returns, and would have been lower if Rule 12b-1 fees had been paid.
(f) The value of a $10,000 investment for Class N is $73,406 for the period
from 12/27/95 - 12/31/99. The performance of the Class N shares is lower
than Class I shares due to the effects of 12b-1 fees.
Page 30
<PAGE>
Dresdner RCM Global Technology Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS
CYCLICAL/CAPITAL GOODS SECTOR 1.6%
INDUSTRIAL EQUIPMENT 1.6%
111,600 BH Tyco International Ltd. $ 4,338,450
INTEREST-SENSITIVE SECTOR 1.3%
INSURANCE 1.3%
144,000 US InsWeb Corp. * 3,681,000
TECHNOLOGY SECTOR 87.0%
COMPUTERS/OFFICE EQUIPMENT 4.5%
22,000 US Comverse Technology Inc. * 3,184,500
34,000 US E M C Corp. * 3,714,500
75,800 JP NEC Corp. 1,805,468
48,000 US Network Appliance Inc. * 3,987,000
------------
12,691,468
------------
ELECTRONICS/NEW TECHNOLOGY 38.6%
23,600 US Applied Materials Inc. * 2,989,825
24,000 NL ASM Lithography Holding N.V.
(ADR) * 2,730,000
10,000 US Brocade Communications Systems
Inc. * 1,770,000
68,900 US Carrier Access Corp. * 4,637,831
23,000 US CellPoint Inc. * 1,081,000
54,000 US CIENA Corp. * 3,105,000
20,500 US Cisco Systems Inc. * 2,196,062
20,000 US Corning Inc. 2,578,750
32,000 US E-Tek Dynamics Inc. * 4,308,000
36,000 DE Epcos AG (ADR) * 2,688,750
36,000 SE Ericsson (LM)
Telefonaktiebolaget (ADR) 2,364,750
33,000 US Finisar Corp. * 2,965,875
263,400 JP Furukawa Electric Co. Ltd. 3,993,642
80,000 US GlobeSpan Inc. * 5,210,000
80,000 US JDS Uniphase Corp. * 12,905,000
8,100 US Juniper Networks Inc. * 2,754,000
32,000 US KLA-Tencor Corp. * 3,564,000
15,000 US Lucent Technologies Inc. 1,122,188
56,000 US Maxim Integrated Products Inc.
* 2,642,500
50,000 US Microchip Technology Inc. * 3,421,875
28,000 JP Moritex Corp. 1,369,461
31,000 US Motorola Inc. 4,564,750
30,000 FI Nokia Corp. (ADR) 5,700,000
46,000 CA Nortel Networks Corp. 4,646,000
7,800 US Optical Coating Laboratory
Inc. 2,308,800
43,400 US QUALCOMM Inc. * 7,643,825
20,000 US SDL Inc. * 4,360,000
14,400 FR STMicroelectronics N.V. (NY
Registered Shares) 2,180,700
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 31
<PAGE>
Dresdner RCM Global Technology Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS (CONTINUED)
ELECTRONICS/NEW TECHNOLOGY
(CONTINUED)
68,000 US Vitesse Semiconductor Corp. * $ 3,565,750
60,000 US Xilinx Inc. * 2,728,125
------------
108,096,459
------------
TECHNOLOGY SERVICES 43.9%
56,900 IS Aladdin Knowledge Systems * 967,300
21,700 US Amazon.com Inc. * 1,651,913
45,000 US America Online Inc. * 3,394,687
32,000 US Art Technology Group Inc. * 4,100,000
38,000 UK Baltimore Technologies PLC * 3,129,289
71,000 US BEA Systems Inc. * 4,965,562
44,000 US BMC Software Inc. * 3,517,250
44,000 IS Check Point Software
Technologies Ltd. * 8,745,000
33,000 UK CMG PLC 2,420,742
52,000 US Critical Path Inc. * 4,907,500
7,520 US DoubleClick Inc. * 1,903,030
14,000 US E.piphany Inc. * 3,123,750
25,000 US eBay Inc. * 3,129,687
26,000 US Electronic Arts Inc. * 2,184,000
40,000 US Exodus Communications Inc. * 3,552,500
15,200 SE Framtidsfabriken AB 2,753,882
6,700 US FreeMarkets Inc. * 2,286,794
56,000 UK Freeserve PLC (ADR) * 5,152,000
16,400 US I2 Technologies Inc. * 3,198,000
4,200 SE Information Highway AB * 696,706
60,030 US Intuit * 3,598,048
62,000 US Knight/Trimark Group Inc.
(Class A) * 2,852,000
68,400 UK Logica PLC * 1,767,128
18,280 US Macromedia Inc. * 1,336,725
21,000 US Mercury Interactive Corp. * 2,266,688
14,550 US Microsoft Corp. * 1,698,713
19,000 US Mission Critical Software Inc.
* 1,330,000
24,000 US Network Solutions Inc. * 5,221,500
22,000 US Peregrine Systems Inc. * 1,852,125
14,200 US RealNetworks Inc. * 1,708,438
37,000 US Siebel Systems Inc. * 3,108,000
10 JP Softbank Corp. 9,567
28,000 FR Transiciel S.A. 3,381,874
56,700 US USWeb Corp. * 2,519,606
20,000 US VeriSign Inc. * 3,818,750
48,000 US VERITAS Software Corp. * 6,870,000
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 32
<PAGE>
Dresdner RCM Global Technology Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS (CONTINUED)
TECHNOLOGY SERVICES
(CONTINUED)
8 JP Yahoo (Japan) Inc. * $ 7,152,500
15,600 US Yahoo Inc. * 6,749,925
------------
123,021,179
------------
TELEMEDIA/SERVICES SECTOR 2.3%
BUSINESS SERVICES 1.0%
4,400 FR Altran Technologies S.A. 2,659,403
COMMUNICATION SERVICES 1.3%
7,200 DE Mannesmann AG 1,737,074
19,600 US Nextel Communications Inc. * 2,021,250
------------
3,758,324
------------
TOTAL EQUITY INVESTMENTS (COST $151,623,953) 92.2% 258,246,283
------------
SHORT-TERM INVESTMENTS
MONEY MARKET FUNDS 6.9%
9,695,035 US SSgA Money Market Fund 9,695,035
9,695,035 US SSgA U.S. Government Money
Market Fund 9,695,035
------------
TOTAL SHORT-TERM INVESTMENTS (COST $19,390,070) 6.9% 19,390,070
------------
TOTAL INVESTMENTS (COST $171,014,023) ** 99.1% 277,636,353
OTHER ASSETS LESS LIABILITIES 0.9% 2,590,197
------------
NET ASSETS 100.0% $280,226,550
============
</TABLE>
- --------------------------------
* Non-income producing security
ADR American Depository Receipt
The accompanying notes are an integral part of the financial statements.
Page 33
<PAGE>
Dresdner RCM Global Technology Fund
Portfolio of Investments
December 31, 1999
Tax Information:
** For Federal income tax purposes, cost is $171,721,618 and gross aggregate
unrealized appreciation (depreciation) for all securities is as follows:
<TABLE>
<S> <C>
Unrealized appreciation $107,750,545
Unrealized depreciation (1,835,810)
------------
Net unrealized appreciation $105,914,735
============
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Fund's investments in securities at December 31, 1999 categorized by
country:
<TABLE>
<CAPTION>
% OF NET ASSETS
-------------------------------
COUNTRY SHORT-TERM
COUNTRY CODE EQUITIES AND OTHER TOTAL
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------
Bermuda BH 1.6% 1.6%
Canada CA 1.7% 1.7%
Finland FI 2.0% 2.0%
France FR 2.9% 2.9%
Germany DE 1.6% 1.6%
Israel IS 3.5% 3.5%
Japan JP 5.1% 5.1%
Netherlands NL 1.0% 1.0%
Sweden SE 2.1% 2.1%
United Kingdom UK 4.5% 4.5%
United States US 66.2% 7.8% 74.0%
------ ------ -----
Total 92.2% 7.8% 100.0%
====== ====== =====
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 34
<PAGE>
Dresdner RCM Global Health Care Fund
Management's Performance Review
A reduced emphasis on pharmaceutical stocks and an increased focus on
biotechnology companies specializing in therapeutics and genomics energized the
Dresdner RCM Global Health Care Fund toward the end of 1999. For the year ended
December 31, 1999, the Dresdner RCM Global Health Care Fund returned 28.74%,
significantly outperforming its benchmark, the Russell Midcap Health Care Index,
which returned -13.48%.
MARKET REVIEW
The most exciting part of biotechnology today is the genomics sector --
biotech companies that specialize in the information behind genetics. To
illustrate its potential, consider the usual method of diagnosing and treating
breast cancer. A woman typically sees a doctor after discovering a lump on her
breast. Under the best-case scenario, she enters the health care system and the
cancer is removed. In all likelihood, she was genetically programmed to develop
cancer ever since birth. Current diagnostic techniques are finding the disease
very late, making it difficult to treat successfully. The potential of genomics
is to discern the general susceptibility that people have to certain diseases,
and develop treatments early in life.
While the major pharmaceutical companies are vulnerable to congressional
action on Medicare, the therapeutic biotechnology companies are more insulated.
One reason is that biotech companies typically have more drugs in development
than they have on the market. If the federal government acts as anticipated,
drugs currently available on the market would have to be re-priced downward,
whereas research in the pipeline could be shifted away from targeted products.
In addition, biotechnology drugs on the market tend to serve specialty niches
that are not as likely to be on the radar screen of Medicare reform.
FACTORS AFFECTING PERFORMANCE
Two types of stocks, genomics and Internet-based companies, provided
much of the Fund's total return for the year. For example, SciQuest is a Web-
based interactive marketplace for scientific and laboratory products used by
drug companies and research scientists. The stock went public in November 1999
at $16 and reached $79.50 by December 31, 1999. In the genomics area, Maxygen
uses its proprietary technologies to mimic the natural process of evolution,
bringing together advances in molecular biology and classical breeding. The
company went public at $16 in mid-December 1999, ending the year at $71.
The Fund's investment in Amgen has been particularly rewarding during
1999, up nearly 130% for the year. Its robust performance historically has been
driven by Epogen, the company's flagship product which generates red blood cell
growth. Dresdner RCM believed the stock was fully valued for the growth of that
single drug. However, by mid-year Amgen shifted from a mature company back to a
development stage investment story with several new drugs for the treatment of
prostate cancer, rheumatoid arthritis and a kidney disorder. Dresdner RCM's
Grassroots-SM- Research division surveyed a select group of kidney doctors and
asked them how new guidelines from the National Kidney Foundation regarding red
blood cells would affect their utilitization of Amgen's new therapy. The survey
found that utilization was going to be significantly higher than Wall Street
anticipated. As a result, Dresdner RCM was able to anticipate upside surprises
in Amgen's financial performance.
Another excellent performer during the year was Genentech, a company
that was spun off by Roche Holdings in July 1999. Based on Dresdner RCM's
valuation analyses, the stock appeared inexpensive given the earnings potential
of Herceptin (their breast cancer drug), Rituxan (for lymphoma), as well as
other products for heart attack and asthma victims. A New England Journal of
Medicine editorial said that Genentech's asthma drug was the first major step
that has been taken in 40 years to treat the disease. Like Amgen, Genentech is
becoming a core holding of the Fund, up 70% since the Fund's purchase.
The large cap pharmaceutical companies, such as Glaxo-Wellcome, have
underperformed due to the Medicare issue, and positions in these firms have been
reduced in the portfolio. In addition to pharmaceutical companies, a
disappointing performer included Guidant, a maker of implantable cardiac
devices. FDA approval of the company's products has been delayed, causing the
stock to underperform. Once the FDA approves the products, and there is no
reason to think that it won't, the stock price should accelerate.
Page 35
<PAGE>
Dresdner RCM Global Health Care Fund
Management's Performance Review
OUTLOOK
Dresdner RCM believes that pharmaceutical stocks are likely to remain
weak over the next few quarters while Congress debates Medicare reform in a
presidential election year. To bolster his legacy, President Clinton is anxious
to broaden Medicare coverage to include prescription drugs. At a minimum, there
is likely to be some examination regarding drug pricing and the tax advantages
that pharmaceutical companies enjoy. Meanwhile, the Federal Trade Commission is
examining certain business relationships with selected customers involving
significant rebates. For these reasons, pharmaceuticals appear unattractive at
least through the first quarter of 2000. In addition, the portfolio will likely
avoid health maintenance organizations and drug distributors.
Dresdner RCM believes that therapeutic biotechnology companies, such as
Amgen, Genentech and IDEC Pharmaceuticals, will be insulated from the Medicare
debate, as these companies are addressing very unique therapeutic areas. Because
these companies are so R&D intensive, investors are looking at their product
pipelines rather than the products that they are currently marketing. Dresdner
RCM's expectation is that these companies, and companies like them, will
modestly outperform the overall stock market.
Among the most attractive investments, in Dresdner RCM's view, are the
genomics companies, which are likely to enjoy enormous price-earnings multiple
expansion based on their potential discoveries. In addition, companies that are
using the Internet to make the health care industry more efficient are also
likely to do extremely well.
Page 36
<PAGE>
Dresdner RCM Global Health Care Fund
Total Return Index Comparison(c)
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
RCM GLOBAL HEALTH CARE FUND
<S> <C> <C> <C>
Performance Benchmark Data
As of 6/30/97
$10,000 Investment (12/31/96-12/31/99) (d)
Class N Shares Russell Midcap Health Care Index (b) S&P 500 Stock Index (a)
1/1/01 $10,000 $10,000 $10,000
2/1/01 $10,700 $10,353 $10,625
3/1/01 $10,650 $10,552 $10,708
4/1/01 $9,910 $9,637 $10,268
5/1/01 $10,050 $9,786 $10,881
6/1/01 $11,140 $10,712 $11,544
7/1/01 $11,660 $11,201 $12,061
8/1/01 $11,990 $11,904 $13,021
9/1/01 $11,790 $11,739 $12,292
10/1/01 $13,110 $12,373 $12,965
11/1/01 $12,910 $11,644 $12,532
12/1/01 $13,110 $11,886 $13,113
1/1/02 $13,000 $11,920 $13,338
2/1/02 $13,189 $11,938 $13,486
3/1/02 $14,060 $13,012 $14,458
4/1/02 $14,584 $13,725 $15,199
5/1/02 $14,897 $14,044 $15,352
6/1/02 $14,261 $13,805 $15,088
7/1/02 $14,295 $14,337 $15,701
8/1/02 $14,216 $13,961 $15,533
9/1/02 $12,241 $11,459 $13,287
10/1/02 $13,659 $13,170 $14,139
11/1/02 $14,004 $13,869 $15,288
12/1/02 $15,109 $14,571 $16,215
1/1/03 $16,324 $15,903 $17,148
2/1/03 $16,482 $15,117 $17,865
3/1/03 $16,056 $14,398 $17,310
4/1/03 $15,813 $14,287 $18,002
5/1/03 $15,059 $13,244 $18,699
6/1/03 $14,937 $13,466 $18,257
7/1/03 $15,874 $13,772 $19,271
8/1/03 $15,777 $13,446 $18,670
9/1/03 $16,117 $13,300 $18,577
10/1/03 $15,071 $11,845 $18,068
11/1/03 $16,056 $11,925 $19,211
12/1/03 $17,334 $12,625 $19,601
1/1/04 $21,013 $13,759 $20,756
Source: Performance Measurement
</TABLE>
PERFORMANCE(c)
DECEMBER 31, 1999
<TABLE>
<CAPTION>
CUMULATIVE
SINCE SINCE
GLOBAL HEALTH CARE FUND 1 YEAR 3 YEARS INCEPTION INCEPTION
<S> <C> <C> <C> <C>
Class N
Average Annual Total Return(d) 28.74% 28.09% 28.09% 110.15%
S&P 500 Stock Index
Average Annual Total Return(a) 21.04% 27.56% 27.56% 107.56%
Russell Midcap Health Care
Index
Average Annual Total Return(b) -13.48% 11.22% 11.22% 37.59%
</TABLE>
The data above represents past performance of the Fund and may not
indicate future performance. The investment return and principal value of an
investment in the Fund will fluctuate, so that shares, when redeemed, may be
worth more or less than their original cost.
- --------------------------------
(a) The Standard & Poor's 500 Stock Index is a capitalization-weighted index of
500 stocks that attempts to measure performance of the broad domestic
economy through changes in the aggregate market value of 500 stocks
representing major industries.
(b) The Russell Midcap Health Care Index is composed of all medium and
medium/small health care companies in the Russell 1000 Index. The Russell
1000 Index measures the performance of the 1,000 largest companies in the
Russell 3000 Index, which represents approximately 90% of the total market
capitalization of the Russell 3000 Index.
(c) Returns assume reinvestment of all dividends and capital gains
distributions at net asset value.
(d) The Class N shares commenced operations on December 31, 1996.
Page 37
<PAGE>
Dresdner RCM Global Health Care Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- --------------------------------------------------------------------------------
EQUITY INVESTMENTS
HEALTH CARE SECTOR 97.0%
DRUGS AND HOSPITAL SUPPLIES 70.4%
1,100 US Affymetrix Inc. * $ 186,656
4,100 US Amgen Inc. * 246,256
6,800 US BioCryst Pharmaceuticals Inc.
* 200,600
4,000 US Biomet Inc. 160,000
3,500 US Enzon Inc. * 151,813
1,000 US Genentech Inc. * 134,500
3,100 UK Glaxo Wellcome PLC (ADR) 173,212
10,400 US Guidant Corp. * 488,800
1,800 US IDEC Pharmaceuticals Corp. * 176,850
3,700 US INAMED Corp. * 162,337
6,100 US Inhale Therapeutic Systems
Inc. * 259,631
3,150 US Johnson & Johnson 293,344
3,000 US Maxygen Inc. * 213,000
1,726 US Merck & Co. Inc. 115,750
2,100 US PE Biosystems Group 252,656
5,100 US Pfizer Inc. 165,431
1,200 US Pharmacia & Upjohn Inc. 54,000
3,600 CA QLT PhotoTherapeutics Inc. * 211,500
3,700 US Schering-Plough Corp. 156,094
600 US Sepracor Inc. * 59,513
5,300 US Titan Pharmaceuticals Inc. * 100,700
7,000 US Vertex Pharmaceuticals Inc. * 245,000
1,400 US Warner Lambert Co. 114,713
1,900 US Waters Corp. * 100,700
----------
4,423,056
----------
HEALTH CARE SERVICES 26.6%
6,900 US Allscripts Inc. * 303,600
1,900 US CareInsite Inc. * 152,950
2,600 US IMS Health Inc. 70,688
19,700 US MedicaLogic Inc. * 413,700
17,500 US Medscape Inc. 175,000
7,000 US SciQuest.com Inc. * 556,500
----------
1,672,438
----------
TOTAL EQUITY INVESTMENTS (COST $4,934,602) 97.0% 6,095,494
----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 38
<PAGE>
Dresdner RCM Global Health Care Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- --------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS
MONEY MARKET FUNDS 3.0%
93,647 US SSgA Money Market Fund $ 93,647
93,647 US SSgA U.S. Government Money
Market Fund 93,647
----------
TOTAL SHORT-TERM INVESTMENTS (COST $187,294) 3.0% 187,294
----------
TOTAL INVESTMENTS (COST $5,121,896)** 100.0% 6,282,788
OTHER ASSETS LESS LIABILITIES 0.0% 990
----------
NET ASSETS 100.0% $6,283,778
==========
</TABLE>
- --------------------------------
* Non-income producing security
ADR American Depository Receipt
Tax Information:
** For Federal income tax purposes, cost is $5,167,925 and gross aggregate
unrealized appreciation (depreciation) for all securities is as follows:
<TABLE>
<S> <C>
Unrealized appreciation $1,303,375
Unrealized depreciation (188,512)
----------
Net unrealized appreciation $1,114,863
==========
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Fund's investments in securities at December 31, 1999 categorized by
country:
<TABLE>
<CAPTION>
% OF NET ASSETS
-------------------------------
COUNTRY SHORT-TERM
COUNTRY CODE EQUITIES AND OTHER TOTAL
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------
Canada CA 3.4% 3.4%
United Kingdom UK 2.7% 2.7%
United States US 90.9% 3.0% 93.9%
------ ------ -----
Total 97.0% 3.0% 100.0%
====== ====== =====
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 39
<PAGE>
Dresdner RCM International Equity Fund
Management's Performance Review
A focus on Japan and a continuing overweight in technology and
telecommunications caused the Dresdner RCM International Equity Fund to
significantly outperform its benchmarks during 1999. For the year ended December
31, 1999, the Fund achieved total returns of 60.66% and 60.35% for Class I and
Class N shares, respectively. That compares favorably to the portfolio's primary
benchmark, the Morgan Stanley Capital International Europe, Australasia, Far
East Index (EAFE), which returned 27.31%. For the five years ending 12/31/99,
the Fund achieved an average annual return of 24.87% and 24.82% for Class I and
Class N shares, respectively, nearly doubling the return of the benchmark at
13.15%. The Fund performed in the top quarter of all funds in the Lipper
International Fund Universe for the 1-, 2-, 3- and 5-year periods ending
December 31, 1999.
MARKET REVIEW
After being dormant for nearly a decade, the Japanese stock market
surged forward in 1999, as investors became convinced that widespread corporate
restructuring was finally taking place. A series of fiscal stimulus packages
proposed by the Japanese government were not the catalyst. Instead, blue-chip
companies such as Sony began to announce reductions in their labor force and
that many subsidiaries would be consolidated into a single, efficient entity.
These were the true indicators that corporate management would increasingly
focus on the interests of shareholders. The improved business climate caused
investment flows to accelerate into Japan, boosting the yen against the U.S.
dollar.
Europe began 1999 on a historic note: launching the euro in place of 11
local currencies. However, the initial euphoria quickly wore off and the euro
soon weakened, partly because economic growth in Europe paled compared to the
surging U.S economy. In addition, the European Central Bank (ECB) was unable to
significantly lower interest rates to stimulate growth where it was needed,
particularly in Germany, for fear of igniting inflation in fast-growing
peripheral markets such as Italy, Portugal and Spain. Moreover, the ECB was
reluctant to lower interest rates because it would exacerbate the euro's
weakness. Still, cross-border merger and acquisition activity strengthened
during 1999, as corporate managements showed their concern to enhance
shareholder value. The new climate was typified by U.K.-based Vodafone AirTouch
PLC's hostile bid to purchase Mannesmann AG of Germany, and by Olivetti's
hostile acquisition of Telecom Italia, transactions that would not have taken
place prior to the European Monetary Union.
During 1999 and especially the fourth quarter, the "new economy" theme
of Internet-driven productivity that allows growth without inflation also became
very apparent throughout international markets. Indeed, new economy stocks in
technology and telecommunications drove many international equity markets such
as Japan and the rest of Asia to actually outperform the Standard & Poor's 500
Index, reinforcing the benefits to shareholders of geographic diversification.
FACTORS AFFECTING PERFORMANCE
Early in 1999, Dresdner RCM made an important shift in direction that
had a major impact on performance for the year. Up until that point, the Fund's
exposure to Japan was very low, because the government seemed unable to
implement a meaningful reform package aimed at rehabilitating the country's
banks. In late 1998, the stock market in Japan was showing signs of strength,
particularly in the small-cap technology sector. At first, it was unclear
whether this was the beginning of a real recovery, or simply more volatility. By
the first quarter, however, it became apparent that a cultural shift was taking
place in Japan, in which shareholder interests were being elevated. Meanwhile,
the Fund's bottom-up stock selection process was uncovering more and more
companies with solid earnings prospects brought about by corporate
restructuring.
The bulk of the Fund's Japanese commitment was to technology companies,
many of which have long been global leaders. Dresdner RCM's Grassroots-SM-
Research surveys of Japanese consumers indicated that Internet penetration in
Japan was far short of that in the U.S., but the gap was likely to close.
Meanwhile, the U.S. experience had not been factored into the valuation of
Internet companies such as Softbank and Yahoo! Japan, and thus the stocks were
attractively priced. In addition, the Fund's heavy emphasis on
telecommunications stocks was very advantageous to performance. NTT DoCoMo, a
Japanese cellular provider and one of the
Page 40
<PAGE>
Dresdner RCM International Equity Fund
Management's Performance Review
Fund's largest holdings, was the first company to launch phones that can access
the Internet. To take advantage of the improving Japanese economy and awakened
stock market, some investments were made in specialty financial services, such
as Daiwa Securities Group. By emphasizing Japan, the Fund also benefited from
the strengthening of the yen during the year.
In emerging markets, the Fund achieved excellent performance from
Samsung Electronics and Korea Telecom, two Korean companies benefiting from the
rebound in Asia's economies. Within Singapore, DBS Group Holdings, which
includes the Development Bank of Singapore, performed well due to a resurgence
of the Singapore economy while Taiwan Semiconductor Manufacturing Co. Ltd.
performed very well in the fourth quarter, when the bulk of the Fund's superior
performance took place.
Other positive factors impacting the portfolio include a general
underweight in financial services outside of Asia and a lower-than-average
holding in health care. Although interest rates did not rise evenly throughout
the world, the U.S. environment of steadily rising rates set a negative tone for
financial services stocks as a whole. Similarly, the difficult environment
encountered by pharmaceutical stocks in the U.S. adversely affected
pharmaceutical stocks in Europe.
OUTLOOK
As technology and telecommunications stocks have soared, the Fund has
taken some profits and made allocations to more cyclical and energy-sensitive
companies that typically would benefit from faster economic growth. For
instance, a new law expected to pass in Germany reduces the tax burden on banks
that sell certain industrial holdings, which makes German banks more attractive.
Among the broad themes being viewed, management believes the euro is likely to
stabilize, improving dollar-denominated returns for investors. Japan's markets
should continue to offer opportunity, particularly in companies poised to
benefit from recovery in domestic demand. Two examples are Sumitomo Corp. and
Kawasaki Steel, which should benefit from firming steel prices and an economic
recovery in Japan. Finally, and despite their recent appreciation, technology
and telecommunications stocks continue to have a bright outlook.
Page 41
<PAGE>
Dresdner RCM International Growth Equity Fund
Total Return Index Comparison(c)
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PERFORMANCE FROM COMMENCEMENT OF OPERATIONS CLASS I SHARES MSCI-EAFE (A) MSCI-ACWI (B)
12/28/1994 $10,000 $10,000 $10,000
<S> <C> <C> <C>
$9,555 $9,629 $9,617
$9,577 $9,576 $9,592
3/31/1995 $10,054 $10,117 $10,193
$10,492 $10,512 $10,579
$10,564 $10,466 $10,455
6/30/1995 $10,847 $10,321 $10,275
$11,570 $10,907 $10,917
$11,420 $10,529 $10,503
9/30/1995 $11,665 $10,709 $10,711
$11,489 $10,423 $10,426
$11,522 $10,668 $10,719
12/31/1995 $11,799 $11,089 $11,153
$12,126 $11,241 $11,201
$12,271 $11,241 $11,241
3/31/1996 $12,648 $11,450 $11,483
$13,096 $11,797 $11,820
$13,263 $11,620 $11,604
6/30/1996 $13,353 $11,680 $11,673
$12,822 $11,292 $11,334
$13,108 $11,358 $11,362
9/30/1996 $13,404 $11,640 $11,666
$13,302 $11,524 $11,549
$13,864 $11,969 $12,011
12/31/1996 $14,078 $11,830 $11,860
$14,355 $11,612 $11,447
$14,477 $11,825 $11,637
3/31/1997 $14,410 $11,800 $11,683
$14,654 $11,899 $11,747
$15,606 $12,634 $12,514
6/30/1997 $16,502 $13,332 $13,207
$17,509 $13,601 $13,424
$16,292 $12,530 $12,424
9/30/1997 $17,620 $13,208 $13,122
$16,458 $12,084 $12,117
$16,414 $11,933 $11,996
12/31/1997 $16,603 $12,070 $12,104
$17,063 $12,431 $12,661
$17,924 $13,261 $13,476
3/31/1998 $18,602 $13,719 $13,894
$18,954 $13,818 $14,006
$19,063 $13,568 $13,942
6/30/1998 $19,123 $13,517 $14,050
$19,754 $13,645 $14,197
$17,063 $11,721 $12,440
9/30/1998 $16,033 $11,474 $12,062
$16,869 $12,675 $13,323
$17,730 $13,356 $14,009
12/31/1998 $18,895 $13,816 $14,565
1/31/1999 $19,223 $13,801 $14,526
2/28/1999 $18,429 $13,492 $14,183
3/31/1999 $18,832 $14,144 $14,779
4/30/1999 $19,160 $14,851 $15,380
5/31/1999 $18,290 $14,153 $14,591
6/30/1999 $19,804 $14,804 $15,163
7/31/1999 $20,836 $15,152 $15,619
8/31/1999 $21,050 $15,205 $15,680
9/30/1999 $21,479 $15,308 $15,842
10/31/1999 $23,232 $15,878 $16,439
11/30/1999 $26,524 $16,513 $17,014
12/31/1999 $30,357 $18,088 $18,541
PERFORMANCE FROM FIRST PUBLIC OFFERING
Class I Shares MSCI-EAFE (a) MSCI-ACWI (b)
5/22/95 $10,000 $10,000 $10,000
$10,117 $9,992 $10,111
$10,233 $9,984 $10,222
6/30/95 $10,508 $9,811 $10,081
$11,208 $10,424 $10,654
$11,063 $10,029 $10,284
9/30/95 $11,300 $10,228 $10,460
$11,130 $9,956 $10,180
$11,161 $10,236 $10,420
12/31/95 $11,430 $10,650 $10,831
$11,747 $10,696 $10,980
$11,887 $10,735 $10,980
3/31/1996 $12,254 $10,965 $11,184
$12,686 $11,287 $11,523
$12,848 $11,081 $11,350
6/30/1996 $12,935 $11,147 $11,408
$12,421 $10,823 $11,029
$12,698 $10,849 $11,094
9/30/1996 $12,985 $11,140 $11,369
$12,886 $11,029 $11,256
$13,430 $11,470 $11,690
12/31/1996 $13,638 $11,325 $11,554
$13,906 $10,931 $11,342
$14,024 $11,113 $11,549
3/31/1997 $13,959 $11,156 $11,525
$14,195 $11,217 $11,622
$15,117 $11,950 $12,340
6/30/1997 $15,986 $12,612 $13,021
$16,961 $12,819 $13,284
$15,782 $11,864 $12,239
9/30/1997 $17,069 $12,530 $12,901
$15,943 $11,571 $11,803
$15,900 $11,455 $11,656
12/31/1997 $16,083 $11,558 $11,790
$16,529 $12,090 $12,142
$17,363 $12,868 $12,952
3/31/1998 $18,020 $13,267 $13,400
$18,361 $13,375 $13,497
$18,466 $13,313 $13,252
6/30/1998 $18,525 $13,417 $13,202
$19,136 $13,556 $13,327
$16,529 $11,879 $11,448
9/30/1998 $15,532 $11,518 $11,207
$16,342 $12,722 $12,380
$17,175 $13,377 $13,045
12/31/1998 $18,304 $13,908 $13,495
1/31/1999 $18,622 $13,871 $13,480
2/28/1999 $17,852 $13,543 $13,178
3/31/1999 $18,243 $14,112 $13,815
4/30/1999 $18,561 $14,687 $14,580
5/31/1999 $17,718 $13,933 $13,790
6/30/1999 $19,184 $14,479 $14,459
7/31/1999 $20,186 $15,619 $14,799
8/31/1999 $20,394 $15,679 $14,851
9/30/1999 $20,809 $15,841 $14,952
10/31/1999 $22,508 $16,438 $15,508
11/30/1999 $25,697 $17,014 $16,129
12/31/1999 $29,407 $18,543 $17,667
</TABLE>
PERFORMANCE(c)
DECEMBER 31, 1999
<TABLE>
<CAPTION>
INTERNATIONAL LIFE OF FUND LIFE OF FUND
GROWTH EQUITY ANNUALIZED SINCE CUMULATIVE SINCE
FUND 1 YEAR 3 YEARS 5 YEARS 12/28/94(D) 5/22/95(D) 12/28/94(D) 5/22/95(D)
<S> <C> <C> <C> <C> <C> <C> <C>
Class I
Average Annual Total
Return(d) 60.66% 29.19% 24.87% 24.82% 26.38% 203.57% 194.07%
Class N
Average Annual Total
Return(e) 60.35% 29.11% 24.82% 24.77% 26.32% 202.97% 193.50%
MSCI-EAFE Index
Average Annual Total
Return(a) 27.31% 16.06% 13.15% 12.56% 14.42% 80.88% 85.43%
MSCI-ACWI
Average Annual Total
Return(b) 30.92% 15.21% 12.39% 13.12% 13.22% 85.41% 76.67%
</TABLE>
The data above represents past performance of the Fund and may not
indicate future performance. The investment return and principal value of an
investment in the Fund will fluctuate, so that shares, when redeemed, may be
worth more or less than their original cost.
- --------------------------------
(a) The MSCI-EAFE Index is an arithmetic, market value-weighted average of the
performance of over 900 securities listed on the stock exchanges of
countries in Europe, Australasia, and the Far East. The Index is calculated
on a total return basis, which includes reinvestment of gross dividends
before deduction of withholding taxes.
(b) The MSCI-ACWI Index is a market capitalization-weighted index composed of
companies representative of the market structure of 47 developed and
emerging market countries excluding the United States. Stock selection
excludes securities which are not purchasable by foreigners. The Index is
calculated on a total return basis, which includes reinvestment of gross
dividends before deduction of withholding taxes.
(c) Returns assume reinvestment of all dividends and capital gains
distributions at net asset value.
Page 42
<PAGE>
Dresdner RCM International Growth Equity Fund
Total Return Index Comparison(c)
(d) The Class I shares were registered for offer and sale under the Securities
Act of 1933 on May 22, 1995. In accordance with SEC regulations,
performance information is provided for the period beginning on May 22,
1995 ("Registration"). For the convenience of our long-term shareholders,
performance information is also provided for the period beginning on
December 28, 1994 ("Commencement of Operations").
(e) Class N shares were first issued on March 10, 1999, and pay Rule 12b-1
fees. Class N returns through December 31, 1998 are based on Class I
returns, and would have been lower if Rule 12b-1 fees had been paid.
(f) The growth of a $10,000 investment for the Class N is $30,295 and $29,350
for the Fund from December 28, 1994 to December 31, 1999 and from
May 22,1995 to December 31, 1999, respectively. The performance of the
Class N shares is lower than Class I shares due to the effects of 12b-1
fees.
Page 43
<PAGE>
Dresdner RCM International Growth Equity Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS
CONSUMER DURABLES SECTOR 4.5%
AUTOMOTIVE RELATED 0.5%
502 DE Porsche AG (Non-Voting
Preferred Shares) $ 1,375,475
CONSUMER DURABLES 4.0%
7,100 JP Funai Electric Co. Ltd. 4,180,965
22,400 JP Sony Corp. 6,639,147
2,500 JP Sony Corp. (ADR) 711,875
------------
11,531,987
------------
CONSUMER NON-DURABLES SECTOR 3.7%
BEVERAGE/TOBACCO 0.1%
43,679 UK Imperial Tobacco Group PLC 359,695
FOOD/FOOD PROCESSING 0.0%*
20 JP Hokuto Corp. 1,074
HOUSEHOLD/RELATED NON-DURABLES 0.0%*
235 UK Reckitt Benckiser PLC 2,224
RETAIL TRADE 3.6%
15,920 FR Carrefour Supermarche S.A. 2,936,376
184,290 UK Dixons Group PLC 4,433,839
4,570 NL Gucci Group 523,265
11,500 JP Ryohin Keikaku Co. Ltd. 2,307,200
------------
10,200,680
------------
CYCLICAL/CAPITAL GOODS SECTOR 12.3%
CHEMICALS/TEXTILES 1.5%
17,900 NL Akzo Nobel N.V. 897,972
1,800 CH Clariant AG 858,058
55,000 JP Shin Etsu Chemical Co. Ltd. 2,367,211
------------
4,123,241
------------
ELECTRICAL EQUIPMENT 1.1%
25,400 DE Siemens AG 3,231,598
INDUSTRIAL EQUIPMENT 0.7%
229,600 UK Invensys PLC 1,213,453
42,600 NO Tomra Systems ASA 723,522
------------
1,936,975
------------
RAW/BASIC MATERIALS 8.6%
103,100 CA Alcan Aluminum Ltd. 4,246,431
44,870 BR Aracruz Celulose S.A. (ADR) 1,177,838
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 44
<PAGE>
Dresdner RCM International Growth Equity Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS (CONTINUED)
RAW/BASIC MATERIALS
(CONTINUED)
203,790 AU Broken Hill Proprietary Co.
Ltd. $ 2,666,521
2,519 CH Holderbank Financiere Glarus
AG 3,448,951
488,800 IE Jefferson Smurfit Group PLC 1,464,087
10,600 FR Lafarge S.A. 1,234,366
964,000 JP Marubeni Corp. 4,045,349
58,900 KR Pohang Iron & Steel Co. Ltd.
(ADR) 2,061,500
110,700 FI UPM-Kymmene Oyj 4,460,544
------------
24,805,587
------------
TRANSPORTATION SERVICES 0.4%
200,000 JP Nippon Express Co. Ltd. 1,105,351
ENERGY SECTOR 5.1%
ENERGY 5.1%
377,074 UK BP Amoco PLC 3,804,897
12,000 UK BP Amoco PLC (ADR) 711,750
509,900 UK Shell Transport & Trading Co. 4,236,062
44,000 FR Total Fina S.A. (B Shares) 5,872,848
------------
14,625,557
------------
HEALTH CARE SECTOR 2.8%
DRUGS AND HOSPITAL SUPPLIES 2.8%
136,000 UK Glaxo Wellcome PLC 3,851,770
208 CH Roche Holdings AG 2,469,037
42,020 FR Sanofi Synthelabo S.A. ** 1,749,874
------------
8,070,681
------------
INTEREST-SENSITIVE SECTOR 15.7%
BANKING 7.4%
118,000 JP Asahi Bank Ltd. 727,184
47,400 FR Banque Nationale de Paris 4,373,751
49,000 DE Bayerische Hypo- und
Vereinsbank AG 3,346,617
122,322 SG DBS Group Holdings Ltd. ** 2,004,436
42,200 DE Deutsche Bank AG 3,564,476
19,900 KR Housing & Commercial Bank,
Korea (GDR) ** 630,911
133,810 UK HSBC Holdings PLC 1,876,283
226,000 JP Industrial Bank of Japan Ltd. 2,177,541
26,080 KR Kookmin Bank 408,828
103,698 UK Lloyds TSB Group PLC 1,287,623
150,700 SE Nordbanken Holding AB ** 857,713
------------
21,255,363
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 45
<PAGE>
Dresdner RCM International Growth Equity Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS (CONTINUED)
GENERAL FINANCE 5.2%
13,100 JP Aeon Credit Service Ltd. $ 1,078,959
12,800 JP Aiful Corp. 1,565,098
359,000 JP Daiwa Securities Group Inc. 5,615,192
19,900 NL ING Groep N.V. 1,201,573
8,900 JP Mycal Card Inc. 282,941
325,000 JP Nikko Securities Co. Ltd. 4,110,584
67,000 JP Nomura Securities Co. Ltd. 1,209,185
------------
15,063,532
------------
INSURANCE 3.1%
10,300 DE Allianz AG 3,460,296
119,600 UK Allied Zurich AG PLC 1,409,762
11,900 FR Axa S.A. 1,659,065
120,811 UK Prudential Corp. PLC 2,356,489
------------
8,885,612
------------
TECHNOLOGY SECTOR 30.3%
COMPUTERS/OFFICE EQUIPMENT 1.2%
700 JP Canon Inc. 10,819
150,000 JP NEC Corp. 3,572,826
------------
3,583,645
------------
ELECTRONICS/NEW TECHNOLOGY 20.6%
7,000 JP Advantest Corp. 1,848,772
33,000 NL ASM Lithography Holding N.V.
(ADR) ** 3,753,750
23,200 DE Epcos AG ** 1,741,103
76,900 SE Ericsson (LM)
Telefonaktiebolaget (ADR) 4,948,741
150,000 JP Fujitsu Ltd. 6,837,524
375,001 JP Furukawa Electric Co. Ltd. 5,685,736
14,000 JP Matsushita Communications
Industrial Co. 3,697,545
15,000 JP Murata Manufacturing Co. Ltd. 3,521,471
53,600 FI Nokia Oyj 9,718,909
45,000 CA Nortel Networks Corp. 4,545,000
8,900 KR Samsung Electronics 2,084,897
51,000 FR STMicroelectronics N.V. (NY
Registered Shares) 7,723,312
68,108 TW Taiwan Semiconductor
Manufacturing Co. (ADR) 3,064,860
------------
59,171,620
------------
TECHNOLOGY SERVICES 8.5%
11,200 FR Cap Gemini S.A. 2,843,143
28,000 UK CMG PLC 2,053,963
51,000 NL KPNQwest N.V. ** 3,395,876
110,000 UK Misys PLC 1,706,900
9,900 JP Nippon System Development 1,442,923
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 46
<PAGE>
Dresdner RCM International Growth Equity Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS (CONTINUED)
TECHNOLOGY SERVICES
(CONTINUED)
12,100 UK Psion PLC $ 507,985
4,000 DE SAP AG 1,970,376
14,000 DE SAP AG (ADR) 728,875
6,400 JP Softbank Corp. 6,122,665
4 JP Yahoo (Japan) Inc. ** 3,576,250
------------
24,348,956
------------
TELEMEDIA/SERVICES SECTOR 22.6%
BUSINESS SERVICES 2.1%
191,000 HK Hutchison Whampoa Ltd. 2,776,484
31,000 JP Secom Co. Ltd. 3,411,426
------------
6,187,910
------------
COMMUNICATION SERVICES 18.2%
123,327 UK British Telecom PLC 2,987,042
980,000 HK China Telecom (Hong Kong) Ltd.
** 6,114,363
90 JP DDI Corp. 1,232,515
65,000 US Infonet Services Corp. (Class
B) ** 1,706,250
70 JP Japan Telecom Co. Ltd. 2,807,395
50,800 KR Korea Telecom Corp. (ADR) 3,797,300
37,500 DE Mannesmann AG 9,047,259
235 JP Nippon Telegraph & Telephone
Corp. 4,022,792
8,000 JP Nippon Telegraph & Telephone
Corp. (ADR) 689,000
186 JP NTT Mobile Communications
Network Inc. 7,150,347
52,500 FI Sonera Oyj 3,598,882
175,000 IT Telecom Italia Mobile SpA 1,955,014
80,446 ES Telefonica S.A. 2,009,724
24,000 MX Telefonos De Mexico (ADR) 2,700,000
494,100 UK Vodafone Airtouch PLC 2,462,003
------------
52,279,886
------------
MEDIA 2.3%
19,000 JP Asatsu-DK Inc. 1,282,402
12,200 DE EM.TV & Merchandising AG 786,539
1,600 FR Havas Advertising S.A. 681,774
89,600 IT Mediaset SpA 1,393,592
56,000 SG Singapore Press Holdings Ltd. 1,213,445
1,200 FR Societe Television Francaise 628,586
40,000 UK WPP Group PLC 626,504
------------
6,612,842
------------
TOTAL EQUITY INVESTMENTS (COST $187,776,448) 97.0% 278,759,491
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 47
<PAGE>
Dresdner RCM International Growth Equity Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS
MONEY MARKET FUNDS 2.6%
3,981,096 US SSgA Money Market Fund $ 3,981,096
3,378,122 US SSgA U.S. Government Money
Market Fund 3,378,122
------------
TOTAL SHORT-TERM INVESTMENTS (COST $7,359,218) 2.6% 7,359,218
------------
TOTAL INVESTMENTS (COST $195,135,666) *** 99.6% 286,118,709
OTHER ASSETS LESS LIABILITIES 0.4% 1,180,750
------------
NET ASSETS 100.0% $287,299,459
============
</TABLE>
- --------------------------------
* Less than 0.1% of net assets
** Non-income producing security
ADR American Depository Receipt
GDR Global Depository Receipt
*** For Federal income tax purposes, cost is $197,498,056 and gross aggregate
unrealized appreciation (depreciation) for all securities is as follows:
<TABLE>
<S> <C>
Unrealized appreciation $90,577,239
Unrealized depreciation (1,956,586)
-----------
Net unrealized appreciation $88,620,653
===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 48
<PAGE>
Dresdner RCM International Growth Equity Fund
Portfolio of Investments
December 31, 1999
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Fund's investments in securities at December 31, 1999 categorized by
country:
<TABLE>
<CAPTION>
% OF NET ASSETS
-------------------------------
COUNTRY SHORT-TERM
COUNTRY CODE EQUITIES AND OTHER TOTAL
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------
Australia AU 0.9% 0.9%
Brazil BR 0.4% 0.4%
Canada CA 3.1% 3.1%
Finland FI 6.2% 6.2%
France FR 10.3% 10.3%
Germany DE 10.2% 10.2%
Hong Kong HK 3.1% 3.1%
Ireland IE 0.5% 0.5%
Italy IT 1.2% 1.2%
Japan JP 33.1% 33.1%
Korea KR 3.1% 3.1%
Mexico MX 0.9% 0.9%
Netherlands NL 3.4% 3.4%
Norway NO 0.2% 0.2%
Singapore SG 1.1% 1.1%
Spain ES 0.7% 0.7%
Sweden SE 2.0% 2.0%
Switzerland CH 2.4% 2.4%
Taiwan TW 1.1% 1.1%
United Kingdom UK 12.5% 12.5%
United States US 0.6% 3.0% 3.6%
------ ------ -----
Total 97.0% 3.0% 100.0%
====== ====== =====
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 49
<PAGE>
Dresdner RCM Emerging Markets Fund
Management's Performance Review
Superior stock selection in strong markets, plus a significant
overweight in telecommunications and technology, caused percentage returns to
approach triple-digits in 1999. For the year ended December 31, 1999, the
Dresdner RCM Emerging Markets Fund returned 92.12% and 91.78% for the Class I
and Class N shares, respectively. In comparison, the MSCI Emerging Markets Free
Index (EMF), the Fund's benchmark, returned 66.42%.
MARKET REVIEW
After a two-year period that featured a global economic crisis and a
lack of confidence in the world's currencies, emerging market stock performance
was expected to be sluggish at best in 1999. As a result, many emerging market
mutual funds and other investment portfolios were sitting with a large
percentage of cash as 1998 came to a close.
However, central banks around the world aggressively lowered interest
rates, and the response was dramatic. Asia revived almost immediately, while
emerging markets in Eastern Europe, the Middle East and Africa picked up in
midyear. Latin America, which endured the Brazilian devaluation, remained out of
favor until later in 1999, when investors shifted some money away from Asia and
Eastern Europe in search of better value. Political developments, such as the
war in Kosovo in early 1999 and the instability of Boris Yeltsin in Russia, had
little lasting impact on the markets.
Meanwhile, emerging markets also benefited from an investment management
trend to broaden traditional international investing beyond "EAFE" index
countries to include developing areas such as Asia ex-Japan, Latin America and
Eastern Europe.
FACTORS AFFECTING PERFORMANCE
Dresdner RCM Global Investors LLC ("Dresdner RCM"), the Fund's
investment manager, invests in high quality companies with strong franchises,
sustained earnings growth and excellent management. Stock selection is
accomplished from a bottom-up perspective that includes personal meetings with
management.
Early in the year, the Fund benefited from a strong emphasis in Asia,
driven by Japan's emergence from a decade-long recession. In mid-1999, Dresdner
RCM shifted its emphasis toward energy and mining stocks in Eastern Europe, the
Middle East and Africa to take advantage of Europe's economic recovery. Later in
the year, Dresdner RCM sold many of these holdings based on the view that they
were fully priced, and shifted assets to Latin America.
Just over half of the portfolio was invested in telecommunications and
technology as of December 31, 1999, compared to only 21% for the Fund's
benchmark. This overweighting was the result of the Fund investing in many of
the world's leading technology and telecom firms that have benefited from
renewed global growth. For example, Korea-based Samsung Electronics, a natural
beneficiary of the Asia recovery, was purchased at a very attractive price,
especially compared to its U.S. rivals. Management, which had previously had a
closed-door policy, became notably more pro-disclosure in 1999, particularly as
the semiconductor cycle came back into favor. In addition to vastly improving
fundamentals, this positive approach to investor relations was undoubtedly a
positive factor in the stock's success in 1999.
It should be emphasized that stock selection, not country or sector
allocation, accounted for the lion's share of superior performance. For example,
the Fund's largest position at the end of the year, Infosys Technologies Ltd.,
is an Indian software company. The fact that it is located in India or that it
represents exposure to software is not a critical factor. What is important is
that Infosys is considered one of the best software companies in the world,
receiving high praise from Silicon Valley business leaders. It is the employer
of choice for top engineering graduates in India.
As another example, the portfolio benefited from its investment in Dr.
Reddy's Laboratories Inc., a major Indian pharmaceutical concern. Again, the
fact that it is located in India is coincidental. Its sector, pharmaceutical
stocks, was generally out of favor in 1999. However, the stock was selected for
the portfolio partly because Dresdner RCM's Grassroots-SM- Research division
projected that India would pass landmark patent legislation beneficial to the
company, which in fact took place.
Sometimes, a country's political environment can have an influence on
stock selection. In Taiwan, the Fund's
Page 50
<PAGE>
Dresdner RCM Emerging Markets Fund
Management's Performance Review
holdings are exclusively technology-based, including some of the world's premier
companies in electronics, testing equipment and component manufacturing.
However, the Fund was underweighted in Taiwan because about half of the
available public companies are in financial services, and Dresdner RCM's
analytical staff was uncomfortable with Taiwan's regulation of its banking and
brokerage industries. In contrast, the Fund's portfolio managers have a greater
degree of comfort in Mexico's economic policies. Indeed, a company such as
Telefonos de Mexico is displaying solid earnings growth and, as the largest
telecom company in Latin America, is also benefiting from its position as a
highly liquid stock.
Given the Fund's stellar total return for the year, there were notably
very few adverse developments. One such disappointment was the Fund's investment
in Elektrim, a Polish telecom/Internet company, which performed poorly because
of the actions of two major shareholders fighting for control. The Fund also
missed the bull market in Turkey, which was thought to be weak in the area of
Y2K compliance. Of course, actual significant Y2K problems around the world
appear to have been few and far between.
OUTLOOK
Assuming the U.S. economy slows and the Federal Reserve Board does not
raise short-term interest rates too aggressively, Dresdner RCM expects emerging
markets to thrive in 2000 because a benign interest rate environment makes
investors more tolerant of risk. We expect the Fund to continue to focus on
larger-cap, high-quality companies that can execute a valid business strategy
and that have earnings growth at or above their peer groups.
Page 51
<PAGE>
Dresdner RCM Emerging Markets Fund
Total Return Index Comparison(c)
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
$10,000 INVESTMENT (12/30/97 - 12/31/99)(D)(E)(F)
<S> <C> <C>
Class I Shares MSCI Emerging Markets Free Index(a)
12/97 $9,990 $10,024
1/98 $9,720 $9,238
2/98 $10,530 $10,203
3/98 $10,950 $10,645
4/98 $11,120 $10,529
5/98 $9,920 $9,087
6/98 $9,170 $8,134
7/98 $9,590 $8,391
8/98 $7,660 $5,965
9/98 $7,810 $6,344
10/98 $8,660 $7,012
11/98 $8,910 $7,595
12/98 $9,151 $7,485
2/03 $8,879 $7,364
3/03 $8,839 $7,436
4/03 $9,696 $8,416
5/03 $10,715 $9,457
6/03 $10,493 $9,402
7/03 $11,644 $10,469
8/03 $11,472 $10,184
9/03 $11,855 $10,277
10/03 $11,482 $9,930
11/03 $12,098 $10,141
12/03 $14,378 $11,051
1/04 $17,562 $12,457
<CAPTION>
$10,000 INVESTMENT (12/30/97 - 12/31/99)(D)(E)(F)
<S> <C>
IFC Emerging Markets Index(b)
12/97 $10,015
1/98 $9,358
2/98 $10,314
3/98 $10,718
4/98 $10,747
5/98 $9,406
6/98 $8,444
7/98 $8,779
8/98 $6,311
9/98 $6,615
10/98 $7,375
11/98 $7,812
12/98 $7,930
2/03 $7,630
3/03 $7,765
4/03 $8,661
5/03 $9,843
6/03 $9,667
7/03 $10,719
8/03 $10,564
9/03 $10,680
10/03 $10,383
11/03 $10,563
12/03 $11,513
1/04 $13,056
</TABLE>
PERFORMANCE(c)
DECEMBER 31, 1999
<TABLE>
<CAPTION>
CUMULATIVE
SINCE SINCE
EMERGING MARKETS FUND 1 YEAR INCEPTION INCEPTION
<S> <C> <C> <C>
Class I
Average Annual Total Return(d) 92.12% 32.47% 75.62%
Class N
Average Annual Total Return(e) 91.78% 32.36% 75.31%
MSCI Emerging Markets Free Index
Average Annual Total Return(a) 66.42% 11.59% 24.57%
IFC Emerging Markets Index
Average Annual Total Return(b) 67.15% 14.24% 30.56%
</TABLE>
The data above represents past performance of the Fund and may not
indicate future performance. The investment return and principal value of an
investment in the Fund will fluctuate, so that shares, when redeemed, may be
worth more or less than their original cost.
- --------------------------------
(a) The MSCI Emerging Markets Free Index is a market capitalization-weighted
index composed of 981 companies in 26 emerging market countries. The
average market capitalization size of the listed companies is US$800
million.
(b) The IFC Emerging Markets Index represents the IFC Investable regional total
return composite. The term investable indicates that the stocks and the
weights in the IFCI index represent the amount that the foreign
institutional investors might buy by virtue of the applicable foreign
institutional restrictions (either at the national level or by the
individual company's corporate statute) plus factoring in minimum market
capitalization and liquidity screens.
(c) Returns assume reinvestment of all dividends and capital gains
distributions at net asset value.
(d) The Class I shares began operations on December 30, 1997.
(e) Class N shares were first issued on March 9, 1999, and pay Rule 12b-1 fees.
Class N returns through December 31, 1998 are based on Class I returns, and
would have been lower if Rule 12b-1 fees had been paid.
(f) The value of $10,000 for Class N is $17,531 for the period from 12/30/97
-12/31/99. The performance of the Class N shares is lower due to the
effects of 12b-1 fees.
Page 52
<PAGE>
Dresdner RCM Emerging Markets Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS
CONSUMER NON-DURABLES SECTOR 9.0%
BEVERAGE/TOBACCO 1.4%
3,500 BR Companhia Cervejari Brahma
(Sponsored ADR) $ 49,000
1,900 IN ITC Ltd. 29,046
----------
78,046
----------
HOUSEHOLD/RELATED NON-DURABLE 1.6%
1,650 IN Hindustan Lever Ltd. 85,345
LEISURE TIME PRODUCTS/SERVICES 2.0%
32,700 MY Berjaya Sports Toto 70,563
2,000 HU Danubius Hotel and Spa Right * 36,346
----------
106,909
----------
RETAIL TRADE 4.0%
47,500 MX Cifra S.A. de C.V. Series V * 95,251
45,000 HK Giordano International Ltd. 46,311
2,500 MX Grupo Elektra S.A. de C.V.
(GDR) 24,063
22,000 HK Li & Fung Ltd. 55,187
----------
220,812
----------
CYCLICALS/CAPITAL GOODS SECTOR 17.6%
BUILDING/CONSTRUCTION 1.0%
2,500 EG Orascom Construction
Industries * 51,524
CHEMICALS/TEXTILES 2.3%
1,700 KR L.G. Chemicals Ltd. 53,747
1,500 HU Pannonplast Rt 37,018
1,800 HU Tiszai Vegyi Kombinat Rt 34,313
----------
125,078
----------
INDUSTRIAL EQUIPMENT 0.8%
1,200 GR Maillis 45,184
RAW/BASIC MATERIALS 12.9%
14,000 MX Alfa S.A. de C.V. Class A * 65,752
1,600 BR Aracruz Celulose S.A. (ADR) 42,000
13,800 UK Billiton PLC 79,257
8,000 MX Cemex S.A. de C.V. 44,749
1,400 MX Cemex S.A. de C.V. (Sponsored
ADR) * 39,025
87 MX Cemex S.A. de C.V., Rights * 0
2,100 PO Compania de Minas Buenaventura
S.A. (Sponsored ADR) 33,731
1,800 BR Companhia Vale do Rio Doce
(Sponsored ADR) 50,180
1,500 IN Hindalco Industries Ltd. 27,759
2,160 SA Impala Platinum Holdings Ltd. 87,383
6,000 PL KGHM Polska Miedz S.A. 38,017
210 IN Madras Cements Ltd. 33,681
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 53
<PAGE>
Dresdner RCM Emerging Markets Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS (CONTINUED)
RAW/BASIC MATERIALS
(CONTINUED)
675 KR Pohang Iron & Steel Co., Ltd. $ 74,306
8,900 SA Sappi Ltd. 87,916
----------
703,756
----------
TRANSPORTATION SERVICES 0.6%
1,200 GR Minoan Lines 32,928
ENERGY SECTOR 5.7%
ENERGY 5.7%
4,300 RU Lukoil Holding (Sponsored ADR)
Pfd. 38,700
475,000 BR Petroleo Brasiliers S.A.
(Petrobras) 120,952
6,800 SA Sasol Ltd. 57,339
3,109 KR S.K. Corp. 94,187
----------
311,178
----------
HEALTHCARE SECTOR 1.0%
DRUGS & HOSPITAL SUPPLIES 1.0%
1,600 IN Dr. Reddy's Laboratories Ltd. 53,039
INTEREST SENSITIVE SECTOR 8.2%
BANKING 3.8%
3,500 EG Commercial International Bank 51,128
100,000 MX Grupo Financiero Bancomer S.A.
de C.V. O Shares 41,794
18,200 MY Malayan Banking Berhad 64,658
1,650 BR Unibanco (Sponsored GDR) 49,706
----------
207,286
----------
GENERAL FINANCE 4.4%
33,000 MY Arab-Malaysian Finance
Berhad * 38,211
52,500 MY Commerce Asset Holdings Berhad 134,704
5,000 LT Sabanci Holding (GDR) 66,875
----------
239,790
----------
TECHNOLOGY SECTOR 29.1%
COMPUTERS/OFFICE EQUIPMENT 2.3%
1,000 TW Asustek Computer Inc. 10,546
5,404 TW Asustek Computer Inc. (GDR) 75,251
386 KR Trigem Computer Inc. 42,832
----------
128,629
----------
ELECTRONICS/NEW TECHNOLOGY 11.9%
3,200 TW ASE Test Ltd. * 78,000
750 SG Chartered Semiconductor
Manufacturing Ltd. * 54,750
680 IS Orbotech Ltd. * 52,700
733 KR Samsung Electronics Co. 171,711
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 54
<PAGE>
Dresdner RCM Emerging Markets Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS (CONTINUED)
ELECTRONICS/NEW TECHNOLOGY
(CONTINUED)
9,000 TW Taiwan Semiconductor
Manufacturing * $ 47,889
3,198 TW Taiwan Semiconductor
Manufacturing (ADR) * 143,910
28,000 CI United Microelectronics Corp.
Ltd. * 99,920
----------
648,880
----------
TECHNOLOGY SERVICES 14.9%
560 IS Check Point Software Tech * 111,300
275 US Comverse Technology Inc. * 39,806
12,200 SG Datacraft Asia Ltd. 101,260
13,200 SA Dimension Data Holdings Ltd. * 82,782
770 IN Infosys Technologies Ltd.
(ADR) 254,100
1,330 IN Satyam Infoway Ltd. (ADR) * 206,150
300 ES Terra Networks S.A. (Sponsored
ADR) * 16,425
----------
811,823
----------
TELEMEDIA/SERVICES SECTOR 24.7%
COMMUNICATIONS SERVICES 22.2%
1,110 CI China Telecom (Hong Kong) Ltd.
* 142,704
450 KR Dacom Corp. * 231,836
4,900 BR Embratel Participacoes S.A
(ADR) 133,525
6,000 MX Grupo Carso Global Telecom * 56,359
4,500 GR Hellenic Telecommunications
Organization S.A. (ADR) 53,719
600 KR Korea Telecom Corp. 94,584
1,100 KR Korea Telecom Corp. (Sponsored
ADR) 82,225
2,800 IS Partner Communications Co.
Ltd. * 72,450
2,200 BR Tele Norte Leste Participacoes
S.A. (ADR) 56,100
700 BR Telecommunicacoes Brasileiras
S.A. (ADR) 89,950
1,750 MX Telefonos de Mexico (ADR) 196,875
----------
1,210,327
----------
MEDIA 2.5%
900 MX Grupo Televisa S.A. (ADR) * 61,425
3,600 SG Singapore Press Holdings Ltd. 78,031
----------
139,456
----------
TOTAL INVESTMENTS (Cost $3,368,036) ** 95.3% 5,199,990
OTHER ASSETS LESS LIABILITIES 4.7% 253,439
----------
NET ASSETS 100.0% $5,453,429
==========
</TABLE>
- --------------------------------
* Non-income producing security.
ADR American Depository Receipt
GDR Global Depository Receipt
Pfd. Preferred Stock
The accompanying notes are an integral part of the financial statements.
Page 55
<PAGE>
Dresdner RCM Emerging Markets Fund
Portfolio of Investments
December 31, 1999
Tax information:
** For Federal income tax purposes, cost is $3,373,212 and the gross
aggregate unrealized appreciation (depreciation) for all securities as
follows:
<TABLE>
<S> <C>
Unrealized appreciation $1,854,604
Unrealized depreciation (27,826)
----------
Net unrealized appreciation $1,826,778
==========
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Fund's investments in securities at December 31, 1999, categorized by
country:
<TABLE>
<CAPTION>
% OF NET ASSETS
COUNTRY -------------------------
COUNTRY CODE EQUITIES OTHER TOTAL
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------
Brazil BR 10.8% 10.8%
China CI 4.4% 4.4%
Egypt EG 1.9% 1.9%
Greece GR 2.4% 2.4%
Hong Kong HK 1.9% 1.9%
Hungary HU 2.0% 2.0%
India IN 12.6% 12.6%
Israel IS 4.3% 4.3%
Korea KR 15.5% 15.5%
Lithuania LT 1.2% 1.2%
Malaysia MY 5.7% 5.7%
Mexico MX 11.5% 11.5%
Peru PO 0.6% 0.6%
Poland PL 0.7% 0.7%
Russia RU 0.7% 0.7%
Singapore SG 4.3% 4.3%
South Africa SA 5.8% 5.8%
Spain ES 0.3% 0.3%
Taiwan TW 6.5% 6.5%
United Kingdom UK 1.5% 1.5%
United States US 0.7% 4.7% 5.4%
------ ---- -----
Total 95.3% 4.7% 100.0%
====== ==== =====
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 56
<PAGE>
Dresdner RCM Europe Fund
Management's Performance Review
A fourth quarter surge in technology and telecommunication stocks
ignited the Dresdner RCM Europe Fund's overall performance for 1999. For the
year ended December 31, 1999, the Fund achieved a total return of 43.59%. That
compares favorably to the portfolio's primary benchmark, the Morgan Stanley
Capital International Europe Index, which returned 16.21%.
MARKET REVIEW
After a weak first half, the European economy began to strengthen in the
second half of 1999, supported by consumer spending, improving business
confidence and a rise in exports. The euro's weakness, a reflection of sluggish
growth in the first half of the year, generated improved business volume for
European exporters. Meanwhile, European merger & acquisition activity reached
record levels, as did mutual fund inflows, a direct result of the European's new
focus on a new "equity culture." This new culture has come about as European
governments promise less of an old-age safety net while more and more
individuals invest in stocks and mutual funds to save for retirement.
During 1999, the new European Central Bank performed a delicate
balancing act between generating sufficient economic growth in core countries
such as Germany, while restraining growth in peripheral markets such as Ireland
to combat potential inflation, of which there was little evidence. In recent
months, the central bank has moved from an easing posture in the first half of
1999 to a neutral policy. Still, short-term interest rates are just 3%, which is
low compared to other parts of the world.
An important political development took place in Germany, which still
accounts for one third of Europe's economy. Germany's new social democratic
government has put forward a dramatic change in tax policy that should be
positive for German corporations, if the bill is passed. The corporate tax rate
would fall from around 50% to roughly half its current rate. In addition,
capital gains on industrial holdings would be tax free, which should encourage
German corporations to accelerate their restructuring plans by selling non-core
assets.
FACTORS AFFECTING PERFORMANCE
Dresdner RCM Global Investors LLC ("Dresdner RCM"), the Fund's
investment manager, emphasized technology and telecommunications for most of the
year, with these two groups comprising 59% of the Fund's assets at December 31,
1999 compared to 31% for the benchmark index.
The telecommunications strategy focuses on leading wireless
communications companies, such as Mannesmann AG in Germany and Sonera Oyj in
Finland. Mannesmann has an excellent opportunity to capitalize on the growing
consumer interest in wireless products throughout Europe, where usage is
generally more prevalent than in the U.S. Sonera Oyj is a leading cellular
company in Finland, a market where wireless penetration is 70%. The company also
specializes in services allowing mobile subscribers to transact banking and e-
commerce activities in a secure manner through handsets. Other very strong
performers included Nokia, the largest provider of handsets, and
Telefonaktiebolaget LM Ericsson, a leading provider of infrastructure for the
telecom sector.
In technology, STMicroelectronics NV, a French semiconductor company
with production facilities in the U.S. and Europe, is benefiting from the upturn
in the semiconductor cycle. The company has a major focus toward value-added
products serving such fast growing areas as the telecom market and the
automotive industry, where electronic capability is increasingly important.
Another large holding is U.K.-based Baltimore Technologies PLC, which develops
Internet security software, enabling secure communication between businesses and
consumers through the issuance of digital certificates.
The only non-technology or telecommunications holding in the Fund's top
10 is BIPOP SpA, an Italian bank which has made the transition from a regional
player to a pan-European financial services company with value-added
enhancements such as asset management as well as on-line trading and banking
services. Generally, the Fund has been underweight in financials because of the
rising interest rate environment. However, BIPOP has distinguished itself by
seeking new channels of distribution, such as the Internet, and it has
capitalized on the growth in the Italian savings market.
Page 57
<PAGE>
Dresdner RCM Europe Fund
Management's Performance Review
In addition to being underweight in financial services, the Fund is also
light on pharmaceutical companies, which have performed poorly along with their
U.S. counterparts, where the potential expansion of Medicare was thought to hurt
profits. Despite being a significant part of the benchmark, the Fund does not
own any utility stocks -- an advantage for the Fund -- as deregulation across
Europe continues to exert downward pressure on electricity prices.
One factor adversely impacting the Fund's performance was the need to
sell German equities early in 1999 and purchase equities of other countries to
meet its new investment mandate. This shift was driven by shareholder-approved
changes in the investment mandate from a Germany-only fund to a pan-European
portfolio, and its conversion from a closed-end to an open-end fund in May.
Another negative factor was the Fund's underweight holdings in cyclical stocks
during the second quarter, when investor preference shifted briefly from growth
to value.
OUTLOOK
Dresdner RCM's 2000 outlook for Europe remains positive, as economic
growth is increasing, inflation is low and the central bank posture towards
rates does not threaten the currently benign environment. Attractive
opportunities remain among companies in the telecommunications, media and
technology sectors, and Dresdner RCM continues to believe these areas will yield
profitable holdings for the future.
Page 58
<PAGE>
Dresdner RCM Europe Fund*
Total Return Index Comparison(c)
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
$10,000 INVESTMENT (4/5/90 - 12/31/99)(D)
<S> <C> <C> <C>
Class N Shares MSCI-Europe(a) DAX 100(b)
4/90 $10,000 $10,000 $10,000
4/90 $9,150 $9,738 $9,346
5/90 $9,117 $10,535 $9,432
6/90 $9,400 $10,909 $9,862
7/90 $9,708 $11,372 $10,643
8/90 $8,617 $10,249 $9,117
9/90 $7,358 $9,046 $7,545
10/90 $8,250 $9,814 $8,450
11/90 $8,283 $9,917 $8,575
12/90 $8,000 $9,778 $8,318
1/91 $7,898 $10,111 $8,425
2/91 $8,289 $11,000 $8,858
3/91 $7,319 $10,266 $7,848
4/91 $7,600 $10,163 $8,194
5/91 $7,847 $10,466 $8,514
6/91 $7,311 $9,591 $7,813
7/91 $7,591 $10,260 $8,075
8/91 $7,694 $10,451 $8,216
9/91 $7,770 $10,769 $8,390
10/91 $7,481 $10,547 $8,239
11/91 $7,387 $10,303 $8,293
12/91 $7,739 $11,113 $8,872
1/92 $7,835 $11,114 $8,965
2/92 $8,071 $11,162 $9,123
3/92 $7,879 $10,776 $8,953
4/92 $7,853 $11,375 $8,974
5/92 $8,263 $12,026 $9,534
6/92 $8,202 $11,806 $9,712
7/92 $7,792 $11,390 $9,259
8/92 $7,818 $11,358 $9,266
9/92 $7,346 $11,175 $8,761
10/92 $6,883 $10,399 $8,171
11/92 $6,735 $10,398 $8,146
12/92 $6,602 $10,642 $7,980
1/93 $6,806 $10,664 $8,163
2/93 $7,134 $10,790 $8,580
3/93 $7,293 $11,349 $8,829
4/93 $7,249 $11,603 $8,691
5/93 $7,320 $11,732 $8,720
6/93 $6,992 $11,564 $8,369
7/93 $7,329 $11,607 $8,746
8/93 $8,002 $12,629 $9,740
9/93 $8,091 $12,594 $9,824
10/93 $8,490 $13,123 $10,290
11/93 $8,259 $12,843 $10,096
12/93 $8,792 $13,812 $10,880
1/94 $8,559 $14,519 $10,598
2/94 $8,541 $14,009 $10,397
3/94 $8,775 $13,617 $10,768
4/94 $9,142 $14,185 $11,477
5/94 $8,730 $13,586 $10,922
6/94 $8,541 $13,448 $10,871
7/94 $8,792 $14,156 $11,458
8/94 $9,026 $14,609 $11,854
9/94 $8,299 $14,035 $11,103
10/94 $8,550 $14,651 $11,682
11/94 $8,182 $14,095 $11,082
12/94 $8,364 $14,179 $11,508
1/95 $8,064 $14,073 $11,191
2/95 $8,500 $14,397 $12,166
3/95 $8,073 $15,070 $11,812
4/95 $8,300 $15,559 $12,295
5/95 $8,527 $15,882 $12,628
6/95 $8,664 $16,038 $12,958
7/95 $9,009 $16,880 $13,702
8/95 $8,500 $16,233 $12,947
9/95 $8,482 $16,730 $13,049
10/95 $8,436 $16,656 $12,974
11/95 $8,273 $16,781 $12,902
12/95 $8,364 $17,318 $13,188
1/96 $8,682 $17,438 $13,838
2/96 $8,836 $17,762 $13,942
3/96 $8,682 $17,981 $13,913
4/96 $8,355 $18,117 $13,414
5/96 $8,618 $18,264 $13,784
6/96 $8,964 $18,470 $14,119
7/96 $8,846 $18,245 $14,090
8/96 $9,073 $18,792 $14,367
9/96 $9,136 $19,195 $14,513
10/96 $9,164 $19,646 $14,611
11/96 $9,591 $20,648 $15,204
12/96 $9,709 $21,054 $15,299
1/97 $9,600 $21,118 $15,334
2/97 $9,883 $21,403 $15,951
3/97 $10,493 $22,100 $16,918
4/97 $10,210 $21,997 $16,409
5/97 $10,584 $22,942 $17,202
6/97 $11,149 $24,096 $17,926
7/97 $12,278 $25,231 $19,555
8/97 $11,285 $23,796 $17,670
9/97 $12,214 $26,109 $19,204
10/97 $11,522 $24,832 $17,692
11/97 $11,786 $25,219 $18,150
12/97 $12,182 $26,147 $19,048
1/98 $12,724 $27,243 $19,476
2/98 $13,430 $29,379 $20,801
3/98 $14,746 $31,479 $22,112
4/98 $15,558 $32,096 $22,846
5/98 $16,250 $32,754 $24,902
6/98 $17,268 $33,121 $25,822
7/98 $18,775 $33,784 $26,116
8/98 $15,346 $29,540 $21,849
9/98 $14,608 $28,368 $21,326
10/98 $15,676 $30,645 $22,438
11/98 $16,386 $32,285 $23,431
12/98 $16,738 $33,706 $23,515
1/99 $17,253 $33,497 $23,442
2/99 $16,088 $32,656 $21,825
3/99 $15,611 $33,022 $21,288
4/99 $15,973 $34,012 $22,781
5/99 $15,463 $32,386 $21,302
6/99 $16,138 $32,940 $22,233
7/99 $16,342 $33,253 $22,097
8/99 $15,909 $33,599 $22,517
9/99 $15,871 $33,347 $22,214
10/99 $17,095 $34,581 $23,276
11/99 $19,950 $35,521 $23,637
12/99 $24,034 $39,170 $27,457
</TABLE>
PERFORMANCE(c)
DECEMBER 31, 1999
<TABLE>
<CAPTION>
CUMULATIVE
SINCE SINCE
EUROPE FUND 1 YEAR 3 YEARS 5 YEARS INCEPTION INCEPTION
<S> <C> <C> <C> <C> <C>
Class N
Average Annual Total
Return(d) 43.59% 35.27% 23.50% 9.42% 140.34%
MSCI-Europe
Average Annual Total
Return(a) 16.21% 22.99% 22.53% 15.03% 291.67%
DAX 100
Average Annual Total
Return(b) 16.77% 21.52% 19.00% 10.93% 174.57%
</TABLE>
The data above represents past performance of the Fund and may not
indicate future performance. The investment return and principal value of an
investment in the Fund will fluctuate, so that shares, when redeemed, may be
worth more or less than their original cost.
- --------------------------------
* The fund commenced operations on April 5, 1990. The line graph and chart
below reflect the performance of the Fund primarily as a closed-end
investment company that invested primarily in equity securities of German
companies. Beginning on February 9, 1999, the Fund's objective was
expanded to permit investment in European companies. On May 3, 1999, the
Fund converted from a closed-end to an open-end investment company.
(a) The MSCI-Europe Index is a market capitalization-weighted index composed of
companies representative of the market structure of 15 developed countries.
The Index is calculated on a total return basis, which includes
reinvestment of gross dividends before deduction of withholding taxes. The
graph for the MSCI-Europe Index represents growth of $10,000 from
March 31, 1990 compared to the Fund's inception date of April 5, 1990.
(b) The DAX 100 Index is a total rate of return index of the 100 most highly
capitalized stocks traded on the Frankfurt Stock Exchange. The Index was
developed with a base value of 500 as of December 31, 1987. The underlying
stock prices are from XETRA.
(c) Returns assume reinvestment of all dividends and capital gains
distributions at net asset value.
(d) On May 3, 1999, when the Fund converted from a closed-end fund to an
open-end fund, all outstanding shares were converted to Class N shares
subject to a Rule 12b-1 fee. Class N returns thru 5/3/99 do not reflect
12b-1 fees and would be lower if Rule 12b-1 fees had been paid.
Page 59
<PAGE>
Dresdner RCM Europe Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ---------------------------------------------------------------------------------------
EQUITY INVESTMENTS
CONSUMER DURABLES SECTOR 2.5%
AUTOMOTIVE RELATED 2.5%
150,000 IT Magneti Marelli * $ 572,678
400 DE Porsche AG (Non-Voting
Preferred Shares) 1,095,997
-----------
1,668,675
-----------
CONSUMER NON-DURABLES SECTOR 3.8%
HOUSEHOLD/RELATED NON-DURABLES 0.0%**
560 UK Reckitt Benckiser PLC 5,299
RETAIL TRADE 3.8%
7,000 FR Carrefour Supermarche S.A. 1,291,120
52,783 UK Dixons Group PLC 1,269,908
-----------
2,561,028
-----------
CYCLICAL/CAPITAL GOODS SECTOR 10.4%
CHEMICALS/TEXTILES 0.8%
10,000 NL Akzo Nobel N.V. 501,660
ELECTRICAL EQUIPMENT 3.0%
5,600 DE Siemens AG 712,478
25,000 FR Thomson Multimedia * 1,347,330
-----------
2,059,808
-----------
INDUSTRIAL EQUIPMENT 1.6%
18,000 DE Steag Hamatech AG * 652,763
26,600 NO Tomra Systems ASA 451,776
-----------
1,104,539
-----------
RAW/BASIC MATERIALS 4.7%
104,000 UK Billiton PLC 616,299
350 CH Holderbank Financiere Glarus
AG 479,211
13,500 DE SGL Carbon AG * 897,548
30,000 FI UPM-Kymmene Oyj 1,208,820
-----------
3,201,878
-----------
TRANSPORTATION SERVICES 0.3%
11,200 DE Sixt AG (Non-Voting Preferred
Shares) 203,082
ENERGY SECTOR 6.3%
ENERGY 6.3%
111,098 UK BP Amoco PLC 1,121,044
144,000 UK Shell Transport & Trading Co. 1,196,299
5,000 FR Total Fina S.A. (ADR) 346,250
12,300 FR Total Fina S.A. (B Shares) 1,641,728
-----------
4,305,321
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 60
<PAGE>
Dresdner RCM Europe Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ---------------------------------------------------------------------------------------
EQUITY INVESTMENTS (CONTINUED)
HEALTH CARE SECTOR 4.7%
DRUGS AND HOSPITAL SUPPLIES 4.7%
20,000 UK Glaxo Wellcome PLC $ 566,437
12,500 UK Glaxo Wellcome PLC (ADR) 698,437
16,000 DK H Lundbeck A/S 639,233
69 CH Roche Holdings AG 819,055
10,600 FR Sanofi Synthelabo S.A. * 441,425
-----------
3,164,587
-----------
INTEREST-SENSITIVE SECTOR 10.6%
BANKING 7.7%
25,500 IT Banca Popolare di Brescia 2,256,639
6,000 FR Banque Nationale de Paris 553,639
12,600 DE Bayerische Hypo- und
Vereinsbank AG 860,559
13,000 DE Deutsche Bank AG 1,098,061
150 CH Julius Baer Holding Ltd. 453,147
-----------
5,222,045
-----------
INSURANCE 2.9%
3,050 DE Allianz AG 1,024,651
40,000 UK Allied Zurich AG PLC 471,492
25,000 UK Prudential Corp. PLC 487,640
-----------
1,983,783
-----------
TECHNOLOGY SECTOR 30.2%
ELECTRONICS/NEW TECHNOLOGY 22.1%
23,400 NL ASM Lithography Holding N.V.
(ADR) * 2,661,750
9,700 DE Epcos AG * 727,961
38,000 SE Ericsson (LM)
Telefonaktiebolaget (ADR) 2,496,125
30,000 FI Nokia Corp. (ADR) 5,700,000
22,500 FR STMicroelectronics N.V. (NY
Registered Shares) 3,407,344
-----------
14,993,180
-----------
TECHNOLOGY SERVICES 8.1%
21,000 UK Baltimore Technologies PLC * 1,729,344
12,500 UK CMG PLC 916,948
2,000 SE Framtidsfabriken AB 362,353
9,000 SE Icon Medialab International AB
* 313,412
27,500 UK Psion PLC 1,154,511
13,000 DE SAP AG (ADR) 676,812
6,700 ES Terra Networks S.A. * 366,146
-----------
5,519,526
-----------
TELEMEDIA/SERVICES SECTOR 31.3%
BUSINESS SERVICES 6.5%
2,500 FR Altran Technologies S.A. 1,511,025
22,500 DE I-D Media AG * 1,393,920
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 61
<PAGE>
Dresdner RCM Europe Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ---------------------------------------------------------------------------------------
EQUITY INVESTMENTS (CONTINUED)
BUSINESS SERVICES (CONTINUED)
12,500 NL Randstad Holding N.V. $ 601,891
90,000 NL Vedior N.V. 924,747
-----------
4,431,583
-----------
COMMUNICATION SERVICES 19.4%
45,255 UK British Telecom PLC 1,096,099
31,000 US Infonet Services Corp. (Class
B) * 813,750
8,880 UK Jazztel PLC (ADR) * 578,310
17,500 DE Mannesmann AG 4,222,054
49,000 FI Sonera Oyj 3,358,957
90,000 IT Telecom Italia Mobile SpA 1,005,435
42,840 ES Telefonica S.A. 1,070,241
4,500 ES Telefonica S.A. (ADR) 354,656
137,080 UK Vodafone Airtouch PLC 683,043
-----------
13,182,545
-----------
MEDIA 5.4%
11,000 DE EM.TV & Merchandising AG 709,174
1,000 FR Havas Advertising S.A. 426,109
65,000 IT Mediaset SpA 1,010,976
15,700 UK NDS Group PLC (ADR) * 478,850
2,000 FR Societe Television Francaise 1 1,047,644
-----------
3,672,753
-----------
TOTAL EQUITY INVESTMENTS (COST $44,013,621) 99.8% 67,781,292
-----------
SHORT-TERM INVESTMENT
<CAPTION>
FACE
AMOUNT
- ---------
<C> <C> <S> <C> <C>
TIME DEPOSIT 0.6%
$ 412,000 US State Street Bank & Co., Euro
Dollar Time Deposit, 3.750%
maturing 01/03/00 (cost
$412,000) 412,000
TOTAL INVESTMENTS (COST $44,425,621) *** 100.4% 68,193,292
OTHER ASSETS LESS LIABILITIES (0.4)% (283,417)
-----------
NET ASSETS 100.0% $67,909,875
===========
</TABLE>
- --------------------------------
* Non-income producing security
** Less than 0.1% of net assets
ADR American Depository Receipt
The accompanying notes are an integral part of the financial statements.
Page 62
<PAGE>
Dresdner RCM Europe Fund
Portfolio of Investments
December 31, 1999
Tax Information:
*** For Federal income tax purposes, cost is $44,629,936 and gross aggregate
unrealized appreciation (depreciation) for all securities is as follows:
<TABLE>
<CAPTION>
<S> <C>
Unrealized appreciation $24,003,498
Unrealized depreciation (440,142)
-----------
Net unrealized appreciation $23,563,356
===========
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Fund's investments in securities at December 31, 1999 categorized by
country:
<TABLE>
<CAPTION>
% OF NET ASSETS
-------------------------------
COUNTRY SHORT-TERM
COUNTRY CODE EQUITIES AND OTHER TOTAL
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------
Denmark DK 0.9% 0.9%
Finland FI 15.1% 15.1%
France FR 17.7% 17.7%
Germany DE 21.0% 21.0%
Italy IT 7.1% 7.1%
Netherlands NL 6.9% 6.9%
Norway NO 0.7% 0.7%
Spain ES 2.6% 2.6%
Sweden SE 4.7% 4.7%
Switzerland CH 2.6% 2.6%
United Kingdom UK 19.3% 19.3%
United States US 1.2% 0.2% 1.4%
------ ------ -----
Total 99.8% 0.2% 100.0%
====== ====== =====
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 63
<PAGE>
Dresdner RCM Global Equity Fund
Management's Performance Review
A rebounding Japan as well as a heavy emphasis on technology and telecom
stocks helped the Dredner RCM Global Equity Fund outperform its benchmark in
1999. For the year ended December 31, 1999, the Fund returned 62.20%, while the
portfolio's primary benchmark, the MSCI All Country World Free Index, rose
26.82%. The Global Equity Fund performed in the top quintile of the Lipper
Global Funds Universe, ranking 32 out of 257 funds during its first year of
operation.
MARKET REVIEW
Decisive action by the Federal Reserve Board and central banks around
the world stopped the Asian economic crisis of 1997-1998 in its tracks and
restored confidence in global markets. By early 1999, fears of deflation
evaporated as commodity prices surged but inflation remained modest. Overall,
non-U.S. markets outperformed the U.S. stock market in 1999, an impressive feat
considering that the S&P 500 Index rose by more than 20% for the fifth year in a
row.
In Japan, a revolutionary cultural shift began to take place in the
business community, as profitability increasingly became a key objective.
Leading the charge was Japan's technology community, which is setting the
standards for corporate restructuring in Japan. Initially, Europe's markets
suffered from an outflow of capital to Asian markets. However, the euro
stabilized and Europe's major economies began to improve in the latter half of
1999. The euro's weakness, a reflection of sluggish growth in the first half of
the year, actually generated improved business volume for European exporters.
Meanwhile, European merger and acquisition activity reached record levels.
As 1999 progressed, the world was increasingly divided into two
spheres -- not West vs. East or Europe vs. Asia, but new economy vs. old
economy. The new economy camp included the obvious technology leaders in
computer software, the Internet, telecommunications, semiconductor equipment and
so on. It also included non-technology companies that were embracing the
efficiencies of the Internet and business-to-business/business-to-consumer
commerce.
FACTORS AFFECTING PERFORMANCE
Throughout most of the year, the Fund overweighed the Japanese market
compared to its benchmark index, with an emphasis on technology,
telecommunications and, recently, financial services. Companies such as Daiwa
Securities Group and Aeon Credit benefitted from the rapid financial market
deregulation in Japan. This shift to Japan caused the Fund to underweight in
Europe and slightly underweight the U.S. From a sector standpoint, technology
and telemedia/ services represented 55% of the portfolio as of December 31, 1999
compared to 37% for the primary benchmark. This dual focus on Japan and global
technology helped the Fund outperform its benchmarks.
In Japan, one of the Fund's strongest performers was Sony Corp. This new
economy stock has positioned itself as a convergence of consumer electronic
appliances, computing and communications devices, as well as movie, television
and music content. Their next generation Sony PlayStation is going to feature
enhanced connectivity to the Internet as well as other computing-related
devices. Dresdner RCM's Grassroots-SM- Research has been instrumental in
assessing the acceptance of Sony's new products into the market place through
customer interviews, focus groups and interviews with retail store managers. As
a result, Sony, a major Japanese exporter, has been a strong performer, despite
the yen's strength.
Telecommunications was one of the strongest performing sectors
throughout the globe. Portfolio holdings include STMicroelectronics, a
French-based producer of specialized semiconductors for the telecommunications,
consumer electronics and automotive industries. Another holding, Mannesmann, a
top German-based telecommunications company, has assembled a very cost-efficient
pan-European cellular network. In emerging markets, China Telecom is the
dominant cellular operator in China, commanding a market share of about 90% in a
country where cellular penetration is only about 2%. Over the next few years,
that penetration is likely to grow to 15%, which suggests dramatic growth
opportunities for China Telecom. Within
Page 64
<PAGE>
Dresdner RCM Global Equity Fund
Management's Performance Review
the U.S., JDS Uniphase is a company whose laser technology plays an important
role in the telecommunications industry's ability to increase the capacity of
traffic carried over fiber-optic networks.
Outside of technology, Colgate Palmolive, one of the world's leading
consumer products companies, boosted revenue growth from the recovery in
emerging markets, while simultaneously cutting costs and raising profit margins.
However, Raytheon, a leading U.S. defense contractor, was unable to fill orders
in a timely fashion, resulting in disappointing earnings. The stock was
subsequently sold due to a loss of confidence in Raytheon's management.
OUTLOOK
World economic growth is likely to be very robust in 2000, which should
benefit commodity and economically-sensitive stocks, particularly in emerging
markets. In Europe, increasing consumer demand should lead to stronger economic
growth and ultimately productivity. Although economic growth in Japan will
remain modest, a new emphasis on shareholder value will increasingly permeate
the culture leading Japanese firms to improve operating efficiencies and
profitability. In the U.S., rising interest rates are likely to slow the
economy, although investors may focus more on booming corporate profits.
Overall, the new economy should lead to continued profitability gains around the
world, as the Internet brings down distribution costs and allows companies to
expand sales channels.
Page 65
<PAGE>
Dresdner RCM Global Equity Fund
Total Return Index Comparison(c)
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
$10,000 INVESTMENT (12/31/98 - 12/31/99)(D)
<S> <C> <C> <C>
Class I Shares S&P 500 Stock Index(a) MSCI-ACWI Free(b)
12/98 $10,000 $10,000 $10,000
1/99 $10,300 $10,418 $10,204
2/99 $9,940 $10,094 $9,948
3/99 $10,430 $10,498 $10,396
4/99 $10,520 $10,904 $10,845
5/99 $10,160 $10,647 $10,462
6/99 $11,000 $11,238 $10,983
7/99 $11,130 $10,887 $10,938
8/99 $11,320 $10,833 $10,925
9/99 $11,380 $10,536 $10,807
10/99 $12,260 $11,203 $11,353
11/99 $13,850 $11,430 $11,707
12/99 $16,220 $12,104 $12,682
</TABLE>
PERFORMANCE(c)
DECEMBER 31, 1999
<TABLE>
<CAPTION>
CUMULATIVE
SINCE SINCE
GLOBAL EQUITY FUND 1 YEAR INCEPTION INCEPTION
<S> <C> <C> <C>
Class I
Average Annual Total Return(d) 62.20% 62.20% 62.20%
S&P 500 Stock Index
Average Annual Total Return(a) 21.04% 21.04% 21.04%
MSCI-ACWI Free
Average Annual Total Return(b) 26.82% 26.82% 26.82%
</TABLE>
The data above represents past performance of the Fund and may not
indicate future performance. The investment return and principal value of an
investment in the Fund will fluctuate, so that shares, when redeemed, may be
worth more or less than their original cost.
- --------------------------------
(a) The Standard & Poor's 500 Stock Index is a capitalization-weighted index of
500 stocks that attempts to measure performance of the board domestic
economy through changes in the aggregate market value of 500 stocks
representing major industries.
(b) The Morgan Stanley Capital International ("MSCI") Global Equity All Country
World Free Index ("ACWI Free") is a market capitalization-weighted index
composed of companies representative of the market structure of 47
developed and emerging market countries in the Americas, Europe/Middle
East, and Asia/Pacific regions. The Index is calculated without dividends
or with gross dividends reinvested, in both U.S. Dollars and local
currencies. The MSCI ACWI Free Index excludes closed markets and those
shares in otherwise free markets which are not purchasable by foreigners.
(c) Returns assume reinvestment of all dividends and capital gains
distributions at net asset value.
(d) The Class I shares commenced operations on December 31, 1998.
Page 66
<PAGE>
Dresdner RCM Global Equity Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS
CONSUMER DURABLES SECTOR 3.6%
AUTOMOTIVE RELATED 0.4%
2 DE Porsche AG (Non-Voting
Preferred Shares) $ 5,480
CONSUMER DURABLES 3.2%
180 JP Sony Corp. (ADR) 51,255
CONSUMER NON-DURABLES SECTOR 6.5%
BEVERAGE/TOBACCO 0.7%
70 US Anheuser-Busch Companies Inc. 4,961
120 US Coca Cola Co. 6,990
----------
11,951
----------
HOUSEHOLD/RELATED NON-DURABLES 2.1%
250 US Colgate Palmolive Co. 16,250
410 US Gillette Co. 16,887
----------
33,137
----------
LEISURE TIME PRODUCTS/SERVICES 0.3%
100 US McDonalds Corp. 4,031
RETAIL TRADE 3.4%
42 FR Carrefour Supermarche S.A. 7,747
160 US Circuit City Stores Inc. 7,210
902 UK Dixons Group PLC 21,701
80 NL Gucci Group 9,160
240 US Safeway Inc. * 8,535
----------
54,353
----------
CYCLICAL/CAPITAL GOODS SECTOR 11.0%
AEROSPACE/DEFENSE 0.5%
150 US General Dynamics Corp. 7,913
CHEMICALS/TEXTILES 0.4%
115 NL Akzo Nobel N.V. 5,769
ELECTRICAL EQUIPMENT 3.0%
250 US General Electric Co. 38,687
70 DE Siemens AG 8,906
----------
47,593
----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 67
<PAGE>
Dresdner RCM Global Equity Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS (CONTINUED)
INDUSTRIAL EQUIPMENT 1.2%
INDUSTRIAL EQUIPMENT
1.2%:(Continued)
500 BH Tyco International Ltd. $ 19,437
RAW/BASIC MATERIALS 5.9%
230 CA Alcan Aluminum Ltd. 9,473
943 AU Broken Hill Proprietary Co.
Ltd. 12,339
8 CH Holderbank Financiere Glarus
AG 10,954
2,500 IE Jefferson Smurfit Group PLC 7,488
7,000 JP Marubeni Corp. 29,375
350 KR Pohang Iron & Steel Co. Ltd.
(ADR) 12,250
290 FI UPM-Kymmene Oyj 11,685
----------
93,564
----------
ENERGY SECTOR 3.6%
ENERGY 3.6%
649 UK BP Amoco PLC 6,549
300 US Enron Corp. 13,312
140 US Schlumberger Ltd. 7,875
1,670 UK Shell Transport & Trading Co. 13,874
110 FR Total Fina S.A. (B Shares) 14,682
27 US Transocean Sedco Forex Inc. 910
----------
57,202
----------
HEALTH CARE SECTOR 7.5%
DRUGS AND HOSPITAL SUPPLIES 7.5%
200 US Amgen Inc. * 12,013
135 US Bristol-Myers Squibb Co. 8,665
80 US Genentech Inc. * 10,760
463 UK Glaxo Wellcome PLC 13,113
120 US Guidant Corp. * 5,640
150 US Merck & Co. Inc. 10,060
135 US PE Biosystems Group 16,242
105 US Pfizer Inc. 3,406
165 US Pharmacia & Upjohn Inc. 7,425
154 FR Sanofi Synthelabo S.A. * 6,413
300 US Warner Lambert Co. 24,581
----------
118,318
----------
INTEREST-SENSITIVE SECTOR 11.5%
BANKING 5.4%
1,000 JP Asahi Bank Ltd. 6,163
300 US Bank of New York Inc. 12,000
150 FR Banque Nationale de Paris 13,841
190 DE Bayerische Hypo- und
Vereinsbank AG 12,977
125 US Citigroup Inc. 6,945
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 68
<PAGE>
Dresdner RCM Global Equity Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS (CONTINUED)
BANKING (CONTINUED)
465 SG DBS Group Holdings Ltd. * $ 7,620
140 DE Deutsche Bank AG 11,825
4 UK HSBC Holdings PLC 56
1,000 JP Industrial Bank of Japan Ltd. 9,635
404 UK Lloyds TSB Group PLC 5,016
----------
86,078
----------
GENERAL FINANCE 2.5%
30 JP Aiful Corp. 3,668
140 US Charles Schwab Corp. 5,373
2,000 JP Daiwa Securities Group Inc. 31,282
----------
40,323
----------
INSURANCE 3.6%
40 DE Allianz AG 13,438
400 UK Allied Zurich AG PLC 4,715
142 US American International Group
Inc. 15,354
45 FR Axa S.A. 6,274
7 UK CGU PLC 113
836 UK Prudential Corp. PLC 16,306
----------
56,200
----------
TECHNOLOGY SECTOR 37.3%
COMPUTERS/OFFICE EQUIPMENT 8.2%
140 US E M C Corp. * 15,295
205 JP Fujitsu Ltd. (ADR) 47,355
140 US Hewlett-Packard Co. 15,951
110 US International Business
Machines 11,880
250 JP NEC Corp. (ADR) 30,469
120 US Sun Microsystems Inc. * 9,292
----------
130,242
----------
ELECTRONICS/NEW TECHNOLOGY 18.8%
180 NL ASM Lithography Holding N.V.
(ADR) * 20,475
260 US Cisco Systems Inc. * 27,853
200 DE Epcos AG * 15,010
240 US JDS Uniphase Corp. * 38,715
100 US Lucent Technologies Inc. 7,481
90 US Motorola Inc. 13,253
280 FI Nokia Oyj 50,770
215 CA Nortel Networks Corp. 21,715
240 US QUALCOMM Inc. * 42,270
40 KR Samsung Electronics 9,370
215 FR STMicroelectronics N.V. (NY
Registered Shares) 32,559
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 69
<PAGE>
Dresdner RCM Global Equity Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
EQUITY INVESTMENTS (CONTINUED)
ELECTRONICS/NEW TECHNOLOGY
(CONTINUED)
392 TW Taiwan Semiconductor
Manufacturing Co. (ADR) $ 17,640
----------
297,111
----------
TECHNOLOGY SERVICES 10.3%
400 US Amdocs Ltd. * 13,800
130 US BMC Software Inc. * 10,392
150 UK CMG PLC 11,003
180 US Exodus Communications Inc. * 15,986
405 US Microsoft Corp. * 47,284
650 UK Misys PLC 10,086
200 US Oracle Corp. * 22,413
75 US Yahoo Inc. * 32,452
----------
163,416
----------
TELEMEDIA/SERVICES SECTOR 18.4%
COMMUNICATION SERVICES 15.2%
115 US Bell Atlantic Corp. 7,080
11 UK British Telecom PLC 266
6,000 HK China Telecom (Hong Kong) Ltd.
* 37,435
400 US Infonet Services Corp. (Class
B) * 10,500
150 KR Korea Telecom Corp. (ADR) 11,212
172 DE Mannesmann AG 41,497
270 US MCI WorldCom Inc. * 14,327
220 JP Nippon Telegraph & Telephone
Corp. (ADR) 18,947
1 JP NTT Mobile Communications
Network Inc. 38,443
150 US SBC Communications Inc. 7,313
300 FI Sonera Oyj 20,565
1,000 IT Telecom Italia Mobile SpA 11,172
135 MX Telefonos De Mexico (ADR) 15,187
1,415 UK Vodafone Airtouch PLC 7,051
----------
240,995
----------
MEDIA 3.2%
100 JP Asatsu-DK Inc. 6,749
150 US Clear Channel Communications * 13,387
10 FR Havas Advertising S.A. 4,261
8 FR Societe Television Francaise 1 4,191
115 US Time Warner Inc. 8,330
250 UK WPP Group PLC 3,916
130 US Young & Rubicam Inc. 9,198
----------
50,032
----------
TOTAL EQUITY INVESTMENTS (COST $1,092,473) 99.4% 1,574,400
----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 70
<PAGE>
Dresdner RCM Global Equity Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ----------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS
MONEY MARKET FUNDS 0.1%
912 US SSgA Money Market Fund $ 912
67 US SSgA U.S. Government Money
Market Fund 67
----------
TOTAL SHORT-TERM INVESTMENTS (COST $979) 0.1% 979
----------
TOTAL INVESTMENTS (COST $1,093,452)** 99.5% 1,575,379
OTHER ASSETS LESS LIABILITIES 0.5% 8,696
----------
NET ASSETS 100.0% $1,584,075
==========
</TABLE>
- --------------------------------
* Non-income producing security
ADR American Depository Receipt
Tax Information:
** For Federal income tax purposes, cost is $1,096,708 and gross aggregate
unrealized appreciation (depreciation) for all securities is as follows:
<TABLE>
<S> <C>
Unrealized appreciation $500,955
Unrealized depreciation (22,284)
--------
Net unrealized appreciation $478,671
========
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 71
<PAGE>
Dresdner RCM Global Equity Fund
Portfolio of Investments
December 31, 1999
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Fund's investments in securities at December 31, 1999 categorized by
country:
<TABLE>
<CAPTION>
% OF NET ASSETS
-------------------------------
COUNTRY SHORT-TERM
COUNTRY CODE EQUITIES AND OTHER TOTAL
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------
Australia AU 0.8% 0.8%
Bermuda BH 1.2% 1.2%
Canada CA 2.0% 2.0%
Finland FI 5.2% 5.2%
France FR 5.7% 5.7%
Germany DE 6.9% 6.9%
Hong Kong HK 2.4% 2.4%
Ireland IE 0.5% 0.5%
Italy IT 0.7% 0.7%
Japan JP 17.2% 17.2%
Korea KR 2.1% 2.1%
Mexico MX 1.0% 1.0%
Netherlands NL 2.2% 2.2%
Singapore SG 0.5% 0.5%
Switzerland CH 0.7% 0.7%
Taiwan TW 1.1% 1.1%
United Kingdom UK 7.2% 7.2%
United States US 42.0% 0.6% 42.6%
------ ------ -----
Total 99.4% 0.6% 100.0%
====== ====== =====
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 72
<PAGE>
Dresdner RCM Strategic Income Fund
Management's Performance Review
A focus on rebounding emerging market debt in the face of rising
interest rates allowed investors in the Dresdner RCM Strategic Income Fund to
earn a positive total return for 1999. For the year ended December 31, 1999, the
Fund returned 2.67% while the Lehman Brothers U.S. Universal Index, the Fund's
unmanaged benchmark, returned 0.18%. While the Fund's total return -- which
equals bond income plus or minus changes in bond prices -- was modest, its
income to shareholders, at 7.09%, was well in excess of inflation.
MARKET REVIEW
During the 1990s, there have been two negative performing years for
bonds -- 1994 and 1999. In both years, interest rates rose rapidly because of a
surging economy. In 1999, rates rose sharply because the U.S. economy continued
to be very robust and bond investors wanted to be compensated for future
inflation. Meanwhile, other economies were rebounding from the recession of
1997-1998, boosting the demand for credit as well as commodities. Indeed, with
oil prices more than doubling, inflation began to rise moderately, reversing a
downward trend that had lasted several years. The Federal Reserve Board
responded by raising short-term interest rates three times in an effort to cool
the economy and stave off inflation.
U.S. Treasury bonds, which have no credit component, performed the worst
of all fixed income asset classes in 1999. The Merrill Lynch U.S. Treasury
Master Index, a measure of a broad maturity spectrum of U.S. Treasury bonds,
returned -2.38% during 1999. The results might have been worse had the federal
government not posted its first surplus in 30 years, thus reducing supply and
exerting upward pressure on prices. Another reason for the poor performance was
that government bonds were overbought in 1998 as global investors engaged in a
flight to quality. That position was unwound in 1999, when investor behavior
reflected a flight from quality, as it became apparent that the world economy
would not collapse, and in fact, would be strong and there would be a surge in
credit demand. Indeed, the J.P. Morgan Emerging Markets Bond Index returned
21.58% in 1999.
FACTORS AFFECTING PERFORMANCE
During 1999, the Dresdner RCM Strategic Income Fund reduced its
allocation to U.S. Treasuries, the worst performing fixed income class, from
about 50% at the end of January, 1999 to zero by year-end. That decision
explains some of the Fund's outperformance during the year. In addition, the
portfolio's duration -- its sensitivity to changes in interest rates -- was
slightly shorter than the benchmark. As a result, the bonds in the portfolio
decreased relatively less in price in the rising interest rate environment of
1999. The most important reason for the Fund's outperformance was its weighting
in emerging market bonds. The balance of the portfolio was invested in
investment-grade corporate bonds, mortgage-backed securities and domestic
high-yield bonds.
Investment-grade corporate bonds, which ended 1999 at about 5% of the
Fund, offered modest incremental income over Treasury bonds of about one
percent. The sector was adversely affected during the summer by Y2K concerns
that third quarter supply would surge because issuers would want to get their
financing out of the way. In addition, investors became more concerned about
event risk -- hence, the modest performance for 1999.
The Fund's mortgage component, at about 20% throughout the year, offered
about a 2.5% incremental yield over Treasury bonds. Mortgages are unique in that
they permit borrowers to refinance at any time, which is a risk in a falling
interest rate environment. However, mortgages typically outperform when interest
rates are rising because homeowners do not refinance. Meanwhile, investors are
compensated for the prepayment risk with higher coupons.
The Fund included a 4.5% position in Greek bonds at year-end, on the
theory that Greece will likely join the European Monetary Union. Although the
bonds did appreciate, the Greek Dracma declined in value along with the euro,
thus offsetting the bonds' appreciation.
Domestic high-yield bonds, which comprised 28% of the Fund at year-end,
offered modest incremental returns, with the Merrill Lynch High Yield U.S.
Corporates
Page 73
<PAGE>
Dresdner RCM Strategic Income Fund
Management's Performance Review
index up just 1.57%. Although there were no problem credits in the portfolio,
there were some defaults in the high-yield market that caused broader
nervousness.
The best performing sector was emerging market debt, which began 1999 at
very high yields on the heels of the Asian and Russian economic crises. World
growth rebounded beyond expectations, boosting credit quality and bond prices.
The Fund's allocation to emerging market debt increased during the year to about
33% at year-end. Areas of particular interest include Latin America, which is
benefiting from strengthening oil prices, and Asia, where economies have
rebounded, and Eastern Europe including Russia, where yields are extremely high
to compensate investors for risk.
OUTLOOK
Dresdner RCM believes that global growth is likely to remain strong,
emerging market debt continues to be attractive. Meanwhile, the outlook for U.S.
Treasury bonds, corporate bonds and mortgage-backed securities is cautious in an
interest rate environment that continues to drift upward. Domestic high-yield
bonds should have a better year in 2000 as 1999's relatively high default rate
fades from view.
Even with its high allocation to emerging markets and domestic
high-yield debt, the Dresdner RCM Strategic Income Fund maintains an average
credit rating of BAA(2)/BBB+ while yielding around 9% -- a compelling premium
over inflation.
Page 74
<PAGE>
Dresdner RCM Strategic Income Fund
Total Return Index Comparison(b)
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
$10,000 INVESTMENT (12/31/98 - 12/31/99)(C) CLASS I SHARES LEHMAN BROTHERS U.S. UNIVERSAL INDEX(A)
<S> <C> <C>
12/98 $10,000 $10,000
1/99 $10,040 $10,067
2/99 $9,840 $9,905
3/99 $10,020 $9,984
4/99 $10,336 $10,043
5/99 $10,057 $9,942
6/99 $10,060 $9,924
7/99 $10,011 $9,883
8/99 $9,942 $9,872
9/99 $10,005 $9,979
10/99 $10,052 $10,021
11/99 $10,126 $10,037
12/99 $10,267 $10,018
</TABLE>
PERFORMANCE(b)
DECEMBER 31, 1999
<TABLE>
<CAPTION>
CUMULATIVE
SINCE SINCE
STRATEGIC INCOME FUND 1 YEAR INCEPTION INCEPTION
<S> <C> <C> <C>
Class I
Average Annual Total Return(c) 2.67% 2.67% 2.67%
Lehman Brothers U.S. Universal
Index
Average Annual Total Return(a) 0.18% 0.18% 0.18%
</TABLE>
The data above represents past performance of the Fund and may not
indicate future performance. The investment return and principal value of an
investment in the Fund will fluctuate, so that shares, when redeemed, may be
worth more or less than their original cost.
- --------------------------------
(a) The Lehman Brothers U.S. Universal Index, like the Lehman Brothers
Aggregate Index, is modular and combines the core Lehman Aggregate Index
with the following cap-weighted sub-sectors: High Yield, Emerging Market,
Rule 144a, and Eurobond Dollar. The Index is broadly diversified by sector,
but is concentrated in AAA-rated and government quality issues.
(b) Returns assume reinvestment of all dividends and capital gains
distributions at net asset value.
(c) The Class I shares commenced operations on December 31, 1998.
Page 75
<PAGE>
Dresdner RCM Strategic Income Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
FACE % OF MARKET VALUE
AMOUNT CURRENCY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ------------------------------------------------------------------------------------------
DEBT INVESTMENTS
ARGENTINA 8.2%
53,000 ARS Republic of Argentina
3.114%, maturing 4/1/01,
Floating Rate-Bocon Bond $ 21,342
38,000 ARS Republic of Argentina
3.114%, maturing 9/1/02,
Floating Rate-Bocon Bond 28,820
55,000 USD Republic of Argentina
0.000%, maturing 10/15/03,
Zero Coupon 36,713
162,800 USD Republic of Argentina
6.813%, maturing 3/31/05,
Floating Rate 148,148
----------
235,023
----------
BRAZIL 3.8%
53,000 USD Federal Republic of Brazil
7.000%, maturing 4/15/00,
Floating Rate 39,443
93,417 USD Federal Republic of Brazil, C
Bond
5.000%, with 3.00% Interest
Capitalization maturing
4/15/14 70,184
----------
109,627
----------
BULGARIA 2.3%
93,000 USD National Republic of Bulgaria
2.750%, maturing 7/28/12, Step
Coupon 66,960
CANADA 3.6%
50,000 CAD Clearnet Communications Inc.
0.000%, maturing 5/1/09, Step
Coupon 30,000
25,000 USD Gulf Canada Resources Ltd.
8.375%, maturing 11/15/05 25,000
50,000 USD Imax Corp.
7.875%, maturing 12/1/05 47,000
----------
102,000
----------
GREECE 4.5%
43,000,000 GRD Hellenic Republic
6.000%, maturing 2/19/06 128,462
INDIA 0.7%
20,000 USD Reliance Industries Ltd.
9.375%, maturing 6/24/26,
(144A) 20,106
KOREA 1.1%
17,000 USD Korea Electric Power Corp.
6.375%, maturing 12/1/03 16,120
17,000 USD Korea Telecom Corp.
7.625%, maturing 4/15/07 15,836
----------
31,956
----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 76
<PAGE>
Dresdner RCM Strategic Income Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
FACE % OF MARKET VALUE
AMOUNT CURRENCY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ------------------------------------------------------------------------------------------
DEBT INVESTMENTS (CONTINUED)
PANAMA 1.2%
43,000 USD Republic of Panama
4.250%, maturing 7/17/14, Step
Coupon $ 33,648
PHILIPPINES 2.4%
70,000 USD Republic of Philippines
9.875%, maturing 1/15/19 69,125
RUSSIA 1.3%
55,000 USD Russian Federation
12.750%, maturing 6/24/28,
(144A) 38,500
TURKEY 2.2%
60,000 USD Republic of Turkey
11.875%, maturing 11/5/04 61,950
UNITED KINGDOM 0.5%
15,000 USD Royal Sun & Alliance Insurance
Group PLC
8.950%, maturing 10/15/29,
(144A) 14,996
UNITED STATES 53.6%
75,000 EUR Adelphia Communications Corp.
7.750%, maturing 1/15/09,
Series B 67,875
75,000 USD Alaska Steel Corp.
7.875%, maturing 2/15/09 71,437
15,000 USD American General Institutional
Capital (144A)
7.570%, maturing 12/1/45,
(144A) 13,992
75,000 USD American Standard Inc.
7.375%, maturing 2/1/08 69,562
50,000 USD Applied Power Inc.
8.750%, maturing 4/1/09 49,000
50,000 USD Calpine Corp.
7.750%, maturing 4/15/09 47,500
25,000 USD Charter Communication Holdings
LLC
8.250%, maturing 4/1/07 23,188
15,000 USD Dow Chemical Co.
7.375%, maturing 11/1/29 14,397
50,000 USD Echostar DBS Corp.
9.375%, maturing 2/1/09 50,365
390,066 USD Federal National Mortgage
Association
6.000%, maturing 1/1/29 356,785
225,000 USD Federal National Mortgage
Association, 7.000%,
30 year, TBA* 217,546
100,000 USD Fox/Liberty Networks LLC
9.750%, maturing 8/1/02, Step
Coupon 80,250
25,000 USD Georgia Gulf Corp.
10.375%, maturing 11/1/07,
(144A) 26,187
25,000 USD Global Crossing Holdings Ltd.
9.125%, maturing 11/15/06,
(144A) 24,813
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 77
<PAGE>
Dresdner RCM Strategic Income Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
FACE % OF MARKET VALUE
AMOUNT COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ------------------------------------------------------------------------------------------
DEBT INVESTMENTS (CONTINUED)
UNITED STATES (CONTINUED)
25,000 USD HMH Properties
7.875%, maturing 8/1/08,
Series B $ 22,375
25,000 USD ISP Holdings Inc.
9.750%, maturing 2/15/02,
Series B 25,125
35,000 USD Liberty Media Group
8.500%, maturing 7/15/29,
(144A) 35,264
15,000 USD Lucent Technologies Inc.
6.450%, maturing 3/15/29 13,127
25,000 USD Manadalay Resort Group
9.250%, maturing 12/1/05 25,437
25,000 USD Navistar International Corp.
8.000%, maturing 2/1/08,
Series B 24,063
50,000 USD Nextel Communications Inc.
9.950%, maturing 2/15/08, Step
Coupon 35,375
75,000 USD Owens Illinois Inc.
7.350%, maturing 5/15/08 68,110
25,000 USD Qwest Communications
International Inc.
8.290%, maturing 2/1/08,
Series B, Step Coupon 19,125
30,000 USD Rohm & Haas Co.
7.850%, maturing 7/15/29 30,102
25,000 USD Sbarro Inc.
11.000%, maturing 9/15/09,
(144A) 25,750
25,000 USD Scotts Co.
8.625%, maturing 1/15/09,
(144A) 24,500
25,000 USD Stater Bros. Holdings Inc.
10.750%, maturing 8/15/06,
(144A) 25,125
60,000 USD Waste Management Inc.
6.875%, maturing 5/15/09,
(144A) 50,104
----------
1,536,479
----------
VENEZUELA 1.8%
78,000 USD Republic of Venezuela
9.250%, maturing 9/15/27 51,776
----------
TOTAL DEBT INVESTMENTS (COST $2,556,159) 87.2% 2,500,608
----------
PREFERRED STOCKS
<CAPTION>
SHARES
- -----------
<C> <C> <S> <C> <C>
UNITED STATES 0.9%
635 USD Citigroup Inc. 5.864%,
Preferred Shares-Series M 26,353
----------
TOTAL PREFERRED STOCKS (COST $29,083) 0.9% 26,353
----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 78
<PAGE>
Dresdner RCM Strategic Income Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
FACE % OF MARKET VALUE
AMOUNT CURRENCY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS
</TABLE>
<TABLE>
<C> <C> <S> <C> <C>
COMMERCIAL PAPER 7.0%
75,000 USD Associates Corp. of North
America
5.670%, maturing 1/14/00 ** $ 74,846
125,000 USD Citicorp.
5.670%, maturing 1/28/00 ** 124,469
----------
199,315
----------
SHARES
- ----------
MONEY MARKET FUNDS 9.0%
128,944 USD SSgA Money Market Fund ** 128,944
128,944 USD SSgA U.S. Government Money
Market Fund 128,944
----------
257,888
----------
TOTAL SHORT-TERM INVESTMENTS (COST $457,203) 16.0% 457,203
----------
TOTAL INVESTMENTS (COST $3,042,445)*** 104.1% 2,984,164
OTHER ASSETS LESS LIABILITIES (4.1)% (117,797)
----------
NET ASSETS 100.0% $2,866,367
==========
</TABLE>
- --------------------------------
144A Security is purchased prusuant to Rule 144A of the Securities Act of 1933
and may be resold only to qualified institutional buyers.
The accompanying notes are an integral part of the financial statements.
Page 79
<PAGE>
Dresdner RCM Strategic Income Fund
Portfolio of Investments
December 31, 1999
* Settlement of mortgage backed securities is on a delayed delivery basis
with the final maturity to be announced (TBA) in the future. At December
31,1999, the cost of the Fund's forward commitment purchases was $220,209.
** A portion of this security has been segregated to cover the forward
commitment purchases.
Tax Information:
*** For Federal income tax purposes, cost is $3,067,221 and gross aggregate
unrealized appreciation (depreciation) for all securities is as follows:
<TABLE>
<CAPTION>
<S> <C>
Unrealized appreciation $ 41,153
Unrealized depreciation (124,210)
--------
Net unrealized depreciation $(83,057)
========
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Fund's investments in securities at December 31, 1999 categorized by
country:
<TABLE>
<CAPTION>
% OF NET ASSETS
----------------------------------------
PREFERRED SHORT-TERM
COUNTRY STOCK DEBT AND OTHER TOTAL
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------
Argentina 8.2% 8.2%
Brazil 3.8% 3.8%
Bulgaria 2.3% 2.3%
Canada 3.6% 3.6%
Greece 4.5% 4.5%
India 0.7% 0.7%
Korea 1.1% 1.1%
Panama 1.2% 1.2%
Philippines 2.4% 2.4%
Russia 1.3% 1.3%
Turkey 2.2% 2.2%
United Kingdom 0.5% 0.5%
United States 0.9% 53.6% 11.9% 66.4%
Venezuela 1.8% 1.8%
------ ---- ------- -----
Total 0.9% 87.2% 11.9% 100.0%
====== ==== ======= =====
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 80
<PAGE>
Dresdner RCM Balanced Fund
Management's Performance Review
Due to the fact that the Dresdner RCM Balanced Fund only had a 15 day
operating history in 1999, a formal Management Performance Review is not being
provided. In lieu of this Review, the Fund's Goal and Principal Investment
Strategies are listed below for your information.
For additional information on Dresdner RCM Balanced Fund, please see the
prospectus for complete information, including risks, fees and expenses.
GOAL
The Fund's goal is to seek long term capital appreciation and current
income by investing in a diversified portfolio of equity and fixed income
securities.
PRINCIPAL INVESTMENT STRATEGIES
Under normal market conditions, the Fund will invest up to 75% of its
total assets in equity securities and at least 25% of its total assets in
investment grade fixed income securities. Up to 30% of the Fund's total assets
may be invested in securities of foreign issuers.
The Fund will allocate its assets among various types of equity and
fixed income securities. The allocation of the Fund's assets will fluctuate with
factors affecting the relative attractiveness of such equity and fixed income
securities. These factors include, among others: general market and economic
conditions and trends, interest and inflation rates, fiscal and monetary
developments, long-term corporate earnings growth, and expected total return and
risk of each asset class.
The Fund focuses its equity securities on companies that it expects will
have higher than average rates of growth and strong potential for capital
appreciation. Foreign stocks are chosen using a similar process, while also
considering country allocation and currency exposure. The Fund's equity
securities may be of any capitalization. However, the Fund will generally not
invest in securities with market capitalizations below $1 billion.
The Fund uses fundamental and original research to select fixed income
securities and manage the mix between U.S. and foreign bonds. The Fund's debt
securities may be of any maturity. A bond's maturity and duration, among other
factors, are important components to the Fund's fixed income process.
Page 81
<PAGE>
Dresdner RCM Balanced Fund
Total Return Index Comparison(d)
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
$10,000 INVESTMENT (12/15/99 - 12/31/99)(E) CLASS I SHARES S&P 500 STOCK INDEX(A) LEHMAN BROTHERS
AGGREGATE BOND INDEX(B)
<S> <C> <C> <C>
12/99 $10,000 $10,000 $10,000
12/99 $10,650 $10,400 $9,938
<CAPTION>
$10,000 INVESTMENT (12/15/99 - 12/31/99)(E) BLENDED S&P 500
STOCK/LEHMAN BROTHERS
AGGREGATE BOND INDEX(C)
<S> <C>
12/99 $10,000
12/99 $10,215
</TABLE>
PERFORMANCE(d)(f)
DECEMBER 31, 1999
<TABLE>
<CAPTION>
CUMULATIVE
SINCE SINCE
BALANCED FUND YTD(F) INCEPTION INCEPTION
<S> <C> <C> <C>
Class I
Average Annual Total Return(d)(e) 6.50% 6.50% 6.50%
S&P 500 Stock Index
Average Annual Total Return(a) 4.00% 4.00% 4.00%
Lehman Brothers Aggregate Bond
Index
Average Annual Total Return(b) -0.62% -0.62% -0.62%
Blended S&P 500 Stock/Lehman
Brothers
Aggregate Bond Index
Average Annual Total Return(c) 2.15% 2.15% 2.15%
</TABLE>
The data above represents past performance of the Fund and may not
indicate future performance. The investment return and principal value of an
investment in the Fund will fluctuate, so that shares, when redeemed, may be
worth more or less than their original cost.
- --------------------------------
(a) The Standard & Poor's 500 Stock Index is a capitalization-weighted index of
500 stocks that attempts to measure performance of the broad domestic
economy through changes in the aggregate market value of 500 stocks
representing major industries.
(b) The Lehman Brothers Aggregate Bond Index, which is a market value weighted
performance benchmark for investment-grade fixed-rate debt issues,
including government, corporate, asset-backed, and mortgage-backed
securities, with maturities of at least one year.
(c) The Blended S & P 500 Stock /Lehman Brothers Aggregate Bond Index is a
blended index comprised of the performance of the two indexes weighted 60%
Standard & Poor's 500 Stock Index and 40% Lehman Brothers Aggregate Bond
Index.
(d) Returns assume reinvestment of all dividends and capital gains
distributions at net asset value.
(e) The Class I shares commenced operations on December 15, 1999.
(f) Unannualized.
Page 82
<PAGE>
Dresdner RCM Balanced Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ---------------------------------------------------------------------------------------
EQUITY INVESTMENTS
CONSUMER NON-DURABLES SECTOR 10.0%
BEVERAGE/TOBACCO 1.9%
100 US Anheuser-Busch Companies Inc. $ 7,087
100 US Coca Cola Co. 5,825
300 US Coca Cola Enterprises Inc. 6,038
----------
18,950
----------
HOUSEHOLD/RELATED NON-DURABLES 3.3%
200 US Colgate Palmolive Co. 13,000
400 US Estee Lauder Cos. Inc. (Class
A) 20,175
----------
33,175
----------
LEISURE TIME PRODUCTS/SERVICES 1.6%
400 US McDonalds Corp. 16,125
RETAIL TRADE 3.2%
200 US Costco Cos. Inc. * 18,250
500 US Walgreen Co. 14,625
----------
32,875
----------
CYCLICAL/CAPITAL GOODS SECTOR 7.4%
AEROSPACE/DEFENSE 1.2%
200 US Honeywell International Inc. 11,538
ELECTRICAL EQUIPMENT 3.1%
200 US General Electric Co. 30,950
INDUSTRIAL EQUIPMENT 2.3%
600 BH Tyco International Ltd. 23,325
RAW/BASIC MATERIALS 0.8%
100 US Alcoa Inc. 8,300
ENERGY SECTOR 2.3%
ENERGY 2.3%
300 US Enron Corp. 13,313
250 US Weatherford International Inc. 9,984
----------
23,297
----------
HEALTH CARE SECTOR 11.8%
DRUGS AND HOSPITAL SUPPLIES 11.8%
400 US Amgen Inc. * 24,025
200 US Bristol-Myers Squibb Co. 12,838
250 US Eli Lilly & Co. 16,625
100 US Genentech Inc. * 13,450
150 US Guidant Corp. * 7,050
200 US Johnson & Johnson 18,625
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 83
<PAGE>
Dresdner RCM Balanced Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
% OF MARKET VALUE
SHARES COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ---------------------------------------------------------------------------------------
EQUITY INVESTMENTS (CONTINUED)
DRUGS AND HOSPITAL SUPPLIES
(CONTINUED)
300 US Pfizer Inc. $ 9,731
200 US Warner Lambert Co. 16,387
----------
118,731
----------
INTEREST-SENSITIVE SECTOR 2.8%
BANKING 1.1%
200 US Citigroup Inc. 11,112
GENERAL FINANCE 0.6%
100 US Federal National Mortgage
Association 6,244
INSURANCE 1.1%
100 US American International Group
Inc. 10,813
TECHNOLOGY SECTOR 21.2%
COMPUTERS/OFFICE EQUIPMENT 4.7%
208 US E M C Corp. * 22,724
150 US Hewlett-Packard Co. 17,091
75 US International Business
Machines 8,100
----------
47,915
----------
ELECTRONICS/NEW TECHNOLOGY 13.0%
200 US Cisco Systems Inc. * 21,425
200 US Intel Corp. 16,462
150 US JDS Uniphase Corp. * 24,197
100 US Lucent Technologies Inc. 7,481
150 FI Nokia Corp. (ADR) 28,500
50 CA Nortel Networks Corp. 5,050
160 US QUALCOMM Inc. * 28,180
----------
131,295
----------
TECHNOLOGY SERVICES 3.5%
300 US Microsoft Corp. * 35,025
TELEMEDIA/SERVICES SECTOR 9.1%
COMMUNICATION SERVICES 5.9%
525 US MCI WorldCom Inc. * 27,858
400 US Qwest Communications
International Inc. * 17,200
300 UK Vodafone AirTouch PLC (ADR) 14,850
----------
59,908
----------
MEDIA 3.2%
200 US Clear Channel Communications * 17,850
200 US Time Warner Inc. 14,487
----------
32,337
----------
TOTAL EQUITY INVESTMENTS (COST $595,237) 64.6% 651,915
----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 84
<PAGE>
Dresdner RCM Balanced Fund
Portfolio of Investments
December 31, 1999
<TABLE>
<CAPTION>
FACE % OF MARKET VALUE
AMOUNT COUNTRY NET ASSETS (NOTE 1)
<C> <C> <S> <C> <C>
- ---------------------------------------------------------------------------------------
DEBT INVESTMENTS
CORPORATE BONDS 6.7%
5,000 CA Hydro Quebec 8.050%, maturing
7/7/24 $ 5,281
5,000 SK Republic of Korea 8.875%,
maturing 4/15/08 5,244
10,000 US American General Finance Corp.
6.750%, maturing 11/15/04 9,700
10,000 US CIT Group Inc. 7.125%,
maturing 10/15/04 9,915
5,000 US CSX Corp. 6.250%, maturing
10/15/08 4,524
5,000 US Ford Motor 6.625%, maturing
10/1/28 4,338
5,000 US International Business
Machines 6.500%, maturing
1/15/28 4,417
5,000 US Lehman Brothers Holdings Inc.
7.000%, maturing 5/15/03 4,933
5,000 US NBD Bank 8.250%, maturing
11/1/24 5,259
5,000 US Safeway Inc. 7.500%, maturing
9/15/09 4,902
5,000 US Tyco International Group S.A.
6.875%, maturing 1/15/29 4,249
5,000 US United Technologies Corp.
7.500%, maturing 9/15/29 4,887
----------
67,649
----------
U.S. GOVERNMENT AND AGENCY
BONDS 26.3%
15,000 US Federal National Mortgage
Association 6.250%, maturing
5/15/29 *** 13,350
80,000 US Federal National Mortgage
Association, 7.000%,
30 year, TBA ** 77,349
80,000 US Federal National Mortgage
Association, 7.500%,
30 year, TBA ** 79,100
65,000 US United States Treasury Notes
5.500%, maturing 2/28/03 *** 63,436
35,000 US United States Treasury Notes
5.625%, maturing 5/15/08 *** 32,922
----------
266,157
----------
TOTAL DEBT INVESTMENTS (COST $334,644) 33.0% 333,806
----------
TOTAL INVESTMENTS (COST $929,881) **** 97.6% 985,721
OTHER ASSETS LESS LIABILITIES
*** 2.4% 23,736
----------
NET ASSETS 100.0% $1,009,457
==========
</TABLE>
- --------------------------------
* Non-income producing security
** Settlement of mortgage backed securities is on a delayed delivery basis
with the final maturity to be announced (TBA) in the future. At December
31, 1999, the cost of the Fund's forward commitment purchases was $156,463.
*** A portion of this security and cash have been segregated to cover the
forward commitment purchase.
ADR American Depository Receipt
The accompanying notes are an integral part of the financial statements.
Page 85
<PAGE>
Dresdner RCM Balanced Fund
Portfolio of Investments
December 31, 1999
Tax Information:
**** For Federal income tax purposes, cost is $849,503 and gross aggregate
unrealized appreciation (depreciation) for all securities is as follows:
<TABLE>
<CAPTION>
<S> <C>
Unrealized appreciation $148,995
Unrealized depreciation (12,777)
--------
Net unrealized appreciation $136,218
========
</TABLE>
The Fund's investments in securities at December 31, 1999 categorized by
country:
<TABLE>
<CAPTION>
% OF NET ASSETS
---------------------------------------
COUNTRY SHORT-TERM
COUNTRY CODE EQUITIES DEBT AND OTHER TOTAL
<S> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------
Bermuda BH 2.3% 2.3%
Canada CA 0.5% 0.5% 1.0%
Finland FI 2.8% 2.8%
South Korea SK 0.5% 0.5%
United Kingdom UK 1.5% 1.5%
United States US 57.5% 32.0% 2.4% 91.9%
------ ---- ------ -----
Total 64.6% 33.0% 2.4% 100.0%
====== ==== ====== =====
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 86
<PAGE>
(THIS PAGE INTENTIONALLY LEFT BLANK)
The accompanying notes are an integral part of the financial statements.
Page 87
<PAGE>
Dresdner RCM Global Funds
Statements of Assets and Liabilities
December 31, 1999
(All numbers in thousands except net asset values per share)
<TABLE>
<CAPTION>
LARGE CAP TAX MANAGED
GROWTH BIOTECHNOLOGY GROWTH
FUND FUND FUND
----------- ------------- -----------
<S> <C> <C> <C>
ASSETS:
Investments at cost $ 11,168 $ 8,672 $ 1,571
=========== ========== ==========
Foreign currency at cost $ -- $ -- $ --
=========== ========== ==========
Short-term investments at cost $ 525 $ 1,348 $ 22
=========== ========== ==========
Investments at value (Note 1) $ 15,445 $ 12,597 $ 2,186
Foreign currency at value (Note 1) -- -- --
Cash 30 567 --
Short-term investments at value (Note 1) 525 1,348 22
Receivables:
Investments sold 27 -- --
Fund shares sold 94 375 26
Forward foreign currency contracts (Notes 1 and 6) -- -- --
Dividends 7 2 1
Interest 1 2 --
Investment Manager (Note 2) 76 46 83
Insurance proceeds* -- -- --
Prepaid expenses -- -- --
Organizational costs (Note 5) 7 -- --
----------- ---------- ----------
Total Assets 16,212 14,937 2,318
----------- ---------- ----------
LIABILITIES:
Payables:
Bank overdraft -- -- --
Investments purchased 302 -- --
Fund shares repurchased -- -- --
Accrued Expenses:
Management fees (Note 2) -- -- --
Distribution fees (Note 3) -- 2 --
Directors' fees (Note 7) 31 31 23
Other 55 34 37
Distributions payable -- -- --
----------- ---------- ----------
Total Liabilities 388 67 60
----------- ---------- ----------
NET ASSETS $ 15,824 $ 14,870 $ 2,258
=========== ========== ==========
NET ASSETS CONSIST OF:
Paid-in capital (Note 4) $ 11,260 $ 9,979 $ 1,655
Accumulated net investment income (loss) -- -- --
Accumulated net realized gain (loss) on investments,
options written and foreign currency transactions 287 966 (12)
Net unrealized appreciation (depreciation) on foreign
currency translations -- -- --
Net unrealized appreciation (depreciation) on
investments 4,277 3,925 615
----------- ---------- ----------
NET ASSETS $ 15,824 $ 14,870 $ 2,258
=========== ========== ==========
CLASS I NET ASSETS $ 14,898 $ -- $ 1,499
=========== ========== ==========
CLASS I SHARES OUTSTANDING 781 -- 100
=========== ========== ==========
CLASS I NET ASSET VALUE PER SHARE, OFFERING AND
REDEMPTION PRICE PER SHARE (NOTES 1 AND 4) $ 19.07 $ -- $ 14.99
=========== ========== ==========
CLASS N NET ASSETS $ 926 $ 14,870 $ 759
=========== ========== ==========
CLASS N SHARES OUTSTANDING 49 743 51
=========== ========== ==========
CLASS N NET ASSET VALUE PER SHARE, OFFERING AND
REDEMPTION PRICE PER SHARE (NOTES 1 AND 4) $ 19.00 $ 20.02 $ 14.95
=========== ========== ==========
</TABLE>
- ------------------------------------
* See "Notes to Financial Highlights," Footnote 13, page 106.
The accompanying notes are an integral part of the financial statements.
Page 88
<PAGE>
Dresdner RCM Global Funds
Statements of Assets and Liabilities
December 31, 1999
(All numbers in thousands except net asset values per share)
<TABLE>
<CAPTION>
GLOBAL GLOBAL GLOBAL INTERNATIONAL EMERGING
SMALL CAP TECHNOLOGY HEALTH CARE GROWTH EQUITY MARKETS
FUND FUND FUND FUND FUND
---------- ------------ ----------- ------------- -----------
<S> <C> <C> <C> <C> <C>
ASSETS:
Investments at cost $ 18,044 $ 151,624 $ 4,935 $ 187,776 $ 3,368
========== ============ ========== ============ ===========
Foreign currency at cost $ -- $ 547 $ -- $ 937 $ 124
========== ============ ========== ============ ===========
Short-term investments at cost $ 897 $ 19,390 $ 187 $ 7,359 $ --
========== ============ ========== ============ ===========
Investments at value (Note 1) $ 24,419 $ 258,246 $ 6,095 $ 278,759 $ 5,200
Foreign currency at value (Note 1) -- 550 -- 937 124
Cash 145 536 -- 1 59
Short-term investments at value (Note 1) 897 19,390 187 7,359 --
Receivables:
Investments sold 176 5,639 -- 108 --
Fund shares sold 98 5,641 12 2,405 35
Forward foreign currency contracts (Notes 1 and 6) -- -- -- -- --
Dividends 2 33 2 229 5
Interest 3 32 1 51 7
Investment Manager (Note 2) 82 -- 53 -- 117
Insurance proceeds* -- -- -- -- --
Prepaid expenses -- 5 -- 12 --
Organizational costs (Note 5) -- 16 -- -- 12
---------- ------------ ---------- ------------ -----------
Total Assets 25,822 290,088 6,350 289,861 5,559
---------- ------------ ---------- ------------ -----------
LIABILITIES:
Payables:
Bank overdraft 46 -- -- -- --
Investments purchased 192 8,311 -- 682 --
Fund shares repurchased 4 1,028 -- 1,643 19
Accrued Expenses:
Management fees (Note 2) -- 383 -- 62 --
Distribution fees (Note 3) -- 13 1 -- --
Directors' fees (Note 7) 31 31 31 80 25
Other 46 95 34 95 62
Distributions payable -- -- -- -- --
---------- ------------ ---------- ------------ -----------
Total Liabilities 319 9,861 66 2,562 106
---------- ------------ ---------- ------------ -----------
NET ASSETS $ 25,503 $ 280,227 $ 6,284 $ 287,299 $ 5,453
========== ============ ========== ============ ===========
NET ASSETS CONSIST OF:
Paid-in capital (Note 4) $ 18,446 $ 168,267 $ 4,541 $ 184,101 $ 3,298
Accumulated net investment income (loss) (104) (16) -- (1,060) (2)
Accumulated net realized gain (loss) on investments,
options written and foreign currency transactions 784 5,350 583 13,280 325
Net unrealized appreciation (depreciation) on foreign
currency translations 2 4 -- (5) --
Net unrealized appreciation (depreciation) on
investments 6,375 106,622 1,160 90,983 1,832
---------- ------------ ---------- ------------ -----------
NET ASSETS $ 25,503 $ 280,227 $ 6,284 $ 287,299 $ 5,453
========== ============ ========== ============ ===========
CLASS I NET ASSETS $ 24,073 $ 197,897 $ -- $ 285,561 $ 5,154
========== ============ ========== ============ ===========
CLASS I SHARES OUTSTANDING 1,030 3,342 -- 12,783 305
========== ============ ========== ============ ===========
CLASS I NET ASSET VALUE PER SHARE, OFFERING AND
REDEMPTION PRICE PER SHARE (NOTES 1 AND 4) $ 23.38 $ 59.21 $ -- $ 22.34 $ 16.87
========== ============ ========== ============ ===========
CLASS N NET ASSETS $ 1,430 $ 82,330 $ 6,284 $ 1,738 $ 299
========== ============ ========== ============ ===========
CLASS N SHARES OUTSTANDING 61 1,392 441 78 18
========== ============ ========== ============ ===========
CLASS N NET ASSET VALUE PER SHARE, OFFERING AND
REDEMPTION PRICE PER SHARE (NOTES 1 AND 4) $ 23.31 $ 59.13 $ 14.25 $ 22.31 $ 16.84
========== ============ ========== ============ ===========
<CAPTION>
GLOBAL STRATEGIC
EUROPE EQUITY INCOME BALANCED
FUND FUND FUND FUND
----------- ---------- ----------- -----------
<S> <C> <C> <C> <C>
ASSETS:
Investments at cost $ 44,014 $ 1,092 $ 2,585 $ 930
=========== ========== =========== ===========
Foreign currency at cost $ 894 $ 3 $ 8 $ --
=========== ========== =========== ===========
Short-term investments at cost $ 412 $ 1 $ 457 $ --
=========== ========== =========== ===========
Investments at value (Note 1) $ 67,781 $ 1,574 $ 2,527 $ 986
Foreign currency at value (Note 1) 889 3 8 --
Cash 10 -- 50 58
Short-term investments at value (Note 1) 412 1 457 --
Receivables:
Investments sold 600 -- -- 127
Fund shares sold 78 -- -- --
Forward foreign currency contracts (Notes 1 and 6) -- -- 7 --
Dividends 110 1 -- 1
Interest 45 -- 44 3
Investment Manager (Note 2) 48 65 48 17
Insurance proceeds* 800 -- -- --
Prepaid expenses 3 -- -- --
Organizational costs (Note 5) -- -- -- --
----------- ---------- ----------- -----------
Total Assets 70,776 1,644 3,141 1,192
----------- ---------- ----------- -----------
LIABILITIES:
Payables:
Bank overdraft -- -- -- --
Investments purchased -- -- 220 167
Fund shares repurchased 1,175 -- -- --
Accrued Expenses:
Management fees (Note 2) -- -- -- --
Distribution fees (Note 3) 11 -- -- --
Directors' fees (Note 7) 9 23 23 4
Other 79 37 32 12
Distributions payable 1,592 -- -- --
----------- ---------- ----------- -----------
Total Liabilities 2,866 60 275 183
----------- ---------- ----------- -----------
NET ASSETS $ 67,910 $ 1,584 $ 2,866 $ 1,009
=========== ========== =========== ===========
NET ASSETS CONSIST OF:
Paid-in capital (Note 4) $ 42,582 $ 1,000 $ 3,000 $ 881
Accumulated net investment income (loss) (17) (1) (29) 1
Accumulated net realized gain (loss) on investments,
options written and foreign currency transactions 1,590 103 (53) 71
Net unrealized appreciation (depreciation) on foreign
currency translations (12) -- 6 --
Net unrealized appreciation (depreciation) on
investments 23,767 482 (58) 56
----------- ---------- ----------- -----------
NET ASSETS $ 67,910 $ 1,584 $ 2,866 $ 1,009
=========== ========== =========== ===========
CLASS I NET ASSETS $ -- $ 1,584 $ 2,866 $ 1,009
=========== ========== =========== ===========
CLASS I SHARES OUTSTANDING -- 100 300 95
=========== ========== =========== ===========
CLASS I NET ASSET VALUE PER SHARE, OFFERING AND
REDEMPTION PRICE PER SHARE (NOTES 1 AND 4) $ -- $ 15.84 $ 9.55 $ 10.65
=========== ========== =========== ===========
CLASS N NET ASSETS $ 67,910 $ -- $ -- $ --
=========== ========== =========== ===========
CLASS N SHARES OUTSTANDING 4,212 -- -- --
=========== ========== =========== ===========
CLASS N NET ASSET VALUE PER SHARE, OFFERING AND
REDEMPTION PRICE PER SHARE (NOTES 1 AND 4) $ 16.12 $ -- $ -- $ --
=========== ========== =========== ===========
</TABLE>
- ------------------------------------
* See "Notes to Financial Highlights," Footnote 13, page 106.
The accompanying notes are an integral part of the financial statements.
Page 89
<PAGE>
Dresdner RCM Global Funds
Statements of Operations
For the Year Ended December 31, 1999
(All numbers in thousands)
<TABLE>
<CAPTION>
LARGE CAP TAX MANAGED
GROWTH BIOTECHNOLOGY GROWTH
FUND FUND FUND
--------- ------------- -----------
<S> <C> <C> <C>
INVESTMENT INCOME: (NOTE 1)
Income:
Dividends $ 75 $ 17 $ 6
Interest 10 7 1
Foreign tax withheld -- -- --
------ ------ -----
Total investment income 85 24 7
------ ------ -----
Expenses:
Investment management fees (Note 2) 86 58 10
Administration fees 31 31 31
Shareholder servicing fee, Class I 13 -- 15
Shareholder servicing fee, Class N 14 19 15
Registration and filing, Class I 32 -- 24
Registration and filing, Class N 19 30 18
Reports to shareholders 19 19 20
Accounting expense 40 15 17
Audit fees 24 19 25
Directors' fees and expenses (Note 7) 28 28 28
Legal fees** 18 17 14
Custodian fees 10 6 7
Distribution fees (Note 3) -- 14 --
Amortization of organization costs (Note 5) -- 3 --
Reimbursement of expenses previously assumed by
Investment Manager (Note 2) -- -- --
Miscellaneous expenses 1 3 3
------ ------ -----
Total expenses before waivers and reimbursements 335 262 227
Less: Expenses waived and reimbursed by Investment
Manager (Note 2) (218) (175) (210)
Recovery from insurance proceeds** -- -- --
------ ------ -----
Total expenses waived, reimbursed, and recovered (218) (175) (210)
------ ------ -----
Total net expenses 117 87 17
------ ------ -----
Net investment income (loss) (32) (63) (10)
------ ------ -----
NET REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) on investments 2,485 2,836 27
Net realized gain (loss) on foreign currency
transactions -- (16) --
Net realized gain on options written -- -- --
------ ------ -----
Net realized gain (loss) 2,485 2,820 27
------ ------ -----
Net change in unrealized appreciation (depreciation)
on investments 2,205 3,516 615
Net change in unrealized appreciation (depreciation)
on foreign currency translations -- -- --
------ ------ -----
Net unrealized appreciation (depreciation) 2,205 3,516 615
------ ------ -----
Net realized and unrealized gain (loss) 4,690 6,336 642
------ ------ -----
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $4,658 $6,273 $ 632
====== ====== =====
</TABLE>
- ------------------------------------
* Period from December 15, 1999 (commencement of operations) to December 31,
1999.
** See "Notes to Financial Highlights," Footnote 13, page 106.
The accompanying notes are an integral part of the financial statements.
Page 90
<PAGE>
Dresdner RCM Global Funds
Statements of Operations
For the Year Ended December 31, 1999
(All numbers in thousands)
<TABLE>
<CAPTION>
GLOBAL GLOBAL GLOBAL INTERNATIONAL EMERGING
SMALL CAP TECHNOLOGY HEALTH CARE GROWTH EQUITY MARKETS EUROPE
FUND FUND FUND FUND FUND FUND
--------- ---------- ----------- ------------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME: (NOTE 1)
Income:
Dividends $ 24 $ 152 $ 35 $ 1,870 $ 46 $ 999
Interest 6 169 4 165 6 74
Foreign tax withheld (3) (3) (1) (192) (5) (128)
------ -------- ------ -------- ------ --------
Total investment income 27 318 38 1,843 47 945
------ -------- ------ -------- ------ --------
Expenses:
Investment management fees (Note 2) 72 683 55 1,234 35 928
Administration fees 31 31 31 31 30 27
Shareholder servicing fee, Class I 16 29 -- 17 14 --
Shareholder servicing fee, Class N 15 34 18 15 14 72
Registration and filing, Class I 31 61 -- 28 23 --
Registration and filing, Class N 12 24 34 24 23 21
Reports to shareholders 19 28 19 20 18 60
Accounting expense 28 43 19 46 46 40
Audit fees 24 24 19 54 25 55
Directors' fees and expenses (Note 7) 28 30 28 75 26 202
Legal fees** 18 18 17 22 18 429
Custodian fees 25 36 11 207 83 51
Distribution fees (Note 3) 1 32 13 1 -- 91
Amortization of organization costs (Note 5) -- 15 -- -- 4 --
Reimbursement of expenses previously assumed by
Investment Manager (Note 2) -- 1 -- -- -- --
Miscellaneous expenses 4 3 2 5 3 78
------ -------- ------ -------- ------ --------
Total expenses before waivers and reimbursements 324 1,092 266 1,779 362 2,054
Less: Expenses waived and reimbursed by Investment
Manager (Note 2) (215) (33) (184) (132) (310) (199)
Recovery from insurance proceeds** -- -- -- -- -- (800)
------ -------- ------ -------- ------ --------
Total expenses waived, reimbursed, and recovered (215) (33) (184) (132) (310) (999)
------ -------- ------ -------- ------ --------
Total net expenses 109 1,059 82 1,647 52 1,055
------ -------- ------ -------- ------ --------
Net investment income (loss) (82) (741) (44) 196 (5) (110)
------ -------- ------ -------- ------ --------
NET REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) on investments 1,651 9,515 1,375 39,085 990 39,674
Net realized gain (loss) on foreign currency
transactions (85) 538 (64) (2,185) (60) (5,625)
Net realized gain on options written -- 581 -- -- -- --
------ -------- ------ -------- ------ --------
Net realized gain (loss) 1,566 10,634 1,311 36,900 930 34,049
------ -------- ------ -------- ------ --------
Net change in unrealized appreciation (depreciation)
on investments 5,651 101,298 206 64,060 1,662 (21,373)
Net change in unrealized appreciation (depreciation)
on foreign currency translations 3 4 -- 998 -- (42)
------ -------- ------ -------- ------ --------
Net unrealized appreciation (depreciation) 5,654 101,302 206 65,058 1,662 (21,415)
------ -------- ------ -------- ------ --------
Net realized and unrealized gain (loss) 7,220 111,936 1,517 101,958 2,592 12,634
------ -------- ------ -------- ------ --------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $7,138 $111,195 $1,473 $102,154 $2,587 $ 12,524
====== ======== ====== ======== ====== ========
<CAPTION>
GLOBAL STRATEGIC
EQUITY INCOME BALANCED
FUND FUND FUND*
------ --------- --------
<S> <C> <C> <C>
INVESTMENT INCOME: (NOTE 1)
Income:
Dividends $ 11 $ 4 $ 1
Interest 1 192 --
Foreign tax withheld (1) (1) --
----- ----- ----
Total investment income 11 195 1
----- ----- ----
Expenses:
Investment management fees (Note 2) 8 22 --
Administration fees 31 31 4
Shareholder servicing fee, Class I -- -- 1
Shareholder servicing fee, Class N -- -- --
Registration and filing, Class I 6 8 1
Registration and filing, Class N -- -- --
Reports to shareholders 11 11 2
Accounting expense 12 9 1
Audit fees 24 24 2
Directors' fees and expenses (Note 7) 28 25 4
Legal fees** 13 12 2
Custodian fees 29 12 --
Distribution fees (Note 3) -- -- --
Amortization of organization costs (Note 5) -- -- --
Reimbursement of expenses previously assumed by
Investment Manager (Note 2) -- -- --
Miscellaneous expenses 2 2 --
----- ----- ----
Total expenses before waivers and reimbursements 164 156 17
Less: Expenses waived and reimbursed by Investment
Manager (Note 2) (150) (120) (17)
Recovery from insurance proceeds** -- -- --
----- ----- ----
Total expenses waived, reimbursed, and recovered (150) (120) (17)
----- ----- ----
Total net expenses 14 36 --
----- ----- ----
Net investment income (loss) (3) 159 1
----- ----- ----
NET REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) on investments 141 (47) 5
Net realized gain (loss) on foreign currency
transactions (1) 19 --
Net realized gain on options written -- -- --
----- ----- ----
Net realized gain (loss) 140 (28) 5
----- ----- ----
Net change in unrealized appreciation (depreciation)
on investments 482 (58) 56
Net change in unrealized appreciation (depreciation)
on foreign currency translations -- 6 --
----- ----- ----
Net unrealized appreciation (depreciation) 482 (52) 56
----- ----- ----
Net realized and unrealized gain (loss) 622 (80) 61
----- ----- ----
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 619 $ 79 $ 62
===== ===== ====
</TABLE>
- ------------------------------------
* Period from December 15, 1999 (commencement of operations) to December 31,
1999.
** See "Notes to Financial Highlights," Footnote 13, page 106.
The accompanying notes are an integral part of the financial statements.
Page 91
<PAGE>
Dresdner RCM Global Funds
Statements of Changes in Net Assets
(All numbers in thousands)
<TABLE>
<CAPTION>
LARGE CAP GROWTH FUND BIOTECHNOLOGY FUND
---------------------------- ----------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DEC. 31, 1999 DEC. 31, 1998 DEC. 31, 1999 DEC. 31, 1998
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss) $ (32) $ (6) $ (63) $ (30)
Net realized gain (loss) on investments, foreign
currency transactions and options written 2,485 1,044 2,820 219
Net change in unrealized appreciation
(depreciation) on investments, foreign currency
translations and options written 2,205 1,181 3,516 409
------- ------ ------- ------
Net increase (decrease) in net assets resulting from
operations 4,658 2,219 6,273 598
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Class I shares:
Net investment income -- (4) -- --
In excess of net investment income -- -- -- --
Net realized gain on investments (2,517) (758) -- --
In excess of net realized gain on investments -- -- -- --
------- ------ ------- ------
Total distributions, Class I (2,517) (762) -- --
------- ------ ------- ------
Class N shares:
Net investment income -- -- -- --
In excess of net investment income -- -- -- --
Net realized gain on investments (46) -- (1,875) (109)
In excess of net realized gain on investments -- -- -- --
------- ------ ------- ------
Total distributions, Class N (46) -- (1,875) (109)
------- ------ ------- ------
Total distributions to shareholders (2,563) (762) (1,875) (109)
NET INCREASE (DECREASE) FROM CAPITAL SHARE
TRANSACTIONS* 5,794 1,453 6,561 422
Redemption fees (Note 1) -- -- -- --
------- ------ ------- ------
TOTAL INCREASE (DECREASE) IN NET ASSETS 7,889 2,910 10,959 911
NET ASSETS:
Beginning of period 7,935 5,025 3,911 3,000
------- ------ ------- ------
End of period $15,824 $7,935 $14,870 $3,911
======= ====== ======= ======
End of period net assets include net investment
income (loss) of: $ -- $ -- $ -- $ --
======= ====== ======= ======
</TABLE>
- ------------------------------------
* For detail on capital share transactions by class, see Statements of
Changes in Net Assets (Capital Stock Activity) on pages 96 and 97.
** Period from December 15, 1999 (commencement of operations) to December 31,
1999.
*** Period from December 31, 1998 (commencement of operations) to December 31,
1998.
The accompanying notes are an integral part of the financial statements.
Page 92
<PAGE>
Dresdner RCM Global Funds
Statements of Changes in Net Assets
(All numbers in thousands)
<TABLE>
<CAPTION>
TAX MANAGED GROWTH FUND GLOBAL SMALL CAP FUND
------------------------------- ----------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DEC. 31, 1999 DEC. 31, 1998*** DEC. 31, 1999 DEC. 31, 1998
------------- ---------------- ------------- -------------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss) $ (10) $ -- $ (82) $ (54)
Net realized gain (loss) on investments, foreign
currency transactions and options written 27 -- 1,566 557
Net change in unrealized appreciation
(depreciation) on investments, foreign currency
translations and options written 615 -- 5,654 298
------ ------ ------- ------
Net increase (decrease) in net assets resulting from
operations 632 -- 7,138 801
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Class I shares:
Net investment income -- -- -- --
In excess of net investment income -- -- -- --
Net realized gain on investments (21) -- (868) (362)
In excess of net realized gain on investments (2) -- -- --
------ ------ ------- ------
Total distributions, Class I (23) -- (868) (362)
------ ------ ------- ------
Class N shares:
Net investment income -- -- -- --
In excess of net investment income -- -- -- --
Net realized gain on investments (6) -- (86) --
In excess of net realized gain on investments -- -- -- --
------ ------ ------- ------
Total distributions, Class N (6) -- (86) --
------ ------ ------- ------
Total distributions to shareholders (29) -- (954) (362)
NET INCREASE (DECREASE) FROM CAPITAL SHARE
TRANSACTIONS* 655 1,000 13,840 585
Redemption fees (Note 1) -- -- -- --
------ ------ ------- ------
TOTAL INCREASE (DECREASE) IN NET ASSETS 1,258 1,000 20,024 1,024
NET ASSETS:
Beginning of period 1,000 -- 5,479 4,455
------ ------ ------- ------
End of period $2,258 $1,000 $25,503 $5,479
====== ====== ======= ======
End of period net assets include net investment
income (loss) of: $ -- $ -- $ (104) $ (1)
====== ====== ======= ======
<CAPTION>
GLOBAL TECHNOLOGY FUND GLOBAL HEALTH CARE FUND
---------------------------- ----------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DEC. 31, 1999 DEC. 31, 1998 DEC. 31, 1999 DEC. 31, 1998
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss) $ (741) $ (103) $ (44) $ (35)
Net realized gain (loss) on investments, foreign
currency transactions and options written 10,634 1,689 1,311 854
Net change in unrealized appreciation
(depreciation) on investments, foreign currency
translations and options written 101,302 4,072 206 366
-------- ------- ------ ------
Net increase (decrease) in net assets resulting from
operations 111,195 5,658 1,473 1,185
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Class I shares:
Net investment income -- -- -- --
In excess of net investment income -- -- -- --
Net realized gain on investments (4,100) (464) -- --
In excess of net realized gain on investments -- -- -- --
-------- ------- ------ ------
Total distributions, Class I (4,100) (464) -- --
-------- ------- ------ ------
Class N shares:
Net investment income -- -- -- --
In excess of net investment income -- -- -- --
Net realized gain on investments (1,490) -- (1,103) (473)
In excess of net realized gain on investments -- -- -- --
-------- ------- ------ ------
Total distributions, Class N (1,490) -- (1,103) (473)
-------- ------- ------ ------
Total distributions to shareholders (5,590) (464) (1,103) (473)
NET INCREASE (DECREASE) FROM CAPITAL SHARE
TRANSACTIONS* 156,064 6,414 427 104
Redemption fees (Note 1) -- -- -- --
-------- ------- ------ ------
TOTAL INCREASE (DECREASE) IN NET ASSETS 261,669 11,608 797 816
NET ASSETS:
Beginning of period 18,558 6,950 5,487 4,671
-------- ------- ------ ------
End of period $280,227 $18,558 $6,284 $5,487
======== ======= ====== ======
End of period net assets include net investment
income (loss) of: $ (16) $ -- $ -- $ --
======== ======= ====== ======
</TABLE>
- ------------------------------------
* For detail on capital share transactions by class, see Statements of
Changes in Net Assets (Capital Stock Activity) on pages 96 and 97.
** Period from December 15, 1999 (commencement of operations) to December 31,
1999.
*** Period from December 31, 1998 (commencement of operations) to December 31,
1998.
The accompanying notes are an integral part of the financial statements.
Page 93
<PAGE>
Dresdner RCM Global Funds
Statements of Changes in Net Assets
(All numbers in thousands)
<TABLE>
<CAPTION>
INTERNATIONAL GROWTH EQUITY
FUND EMERGING MARKETS FUND
---------------------------- ----------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DEC. 31, 1999 DEC. 31, 1998 DEC. 31, 1999 DEC. 31, 1998
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss) $ 196 $ 435 $ (5) $ 35
Net realized gain (loss) on investments, foreign
currency transactions and options written 36,900 (4,599) 930 (463)
Net change in unrealized appreciation
(depreciation) on investments, foreign currency
translations and options written 65,058 18,441 1,662 174
-------- -------- ------ ------
Net increase (decrease) in net assets resulting from
operations 102,154 14,277 2,587 (254)
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Class I shares:
Net investment income (854) (1,801) -- (24)
In excess of net investment income (1,135) -- -- --
Net realized gain on investments (16,421) (2,742) (144) --
In excess of net realized gain on investments -- -- -- --
-------- -------- ------ ------
Total distributions, Class I (18,410) (4,543) (144) (24)
-------- -------- ------ ------
Class N shares:
Net investment income (4) -- -- --
In excess of net investment income (6) -- -- --
Net realized gain on investments (92) -- (5) --
In excess of net realized gain on investments -- -- -- --
-------- -------- ------ ------
Total distributions, Class N (102) -- (5) --
-------- -------- ------ ------
Total distributions to shareholders (18,512) (4,543) (149) (24)
NET INCREASE (DECREASE) FROM CAPITAL SHARE
TRANSACTIONS* 81,682 13,798 281 16
Redemption fees (Note 1) -- -- -- --
-------- -------- ------ ------
TOTAL INCREASE (DECREASE) IN NET ASSETS 165,324 23,532 2,719 (262)
NET ASSETS:
Beginning of period 121,975 98,443 2,734 2,996
-------- -------- ------ ------
End of period $287,299 $121,975 $5,453 $2,734
======== ======== ====== ======
End of period net assets include net investment
income (loss) of: $ (1,060) $ 662 $ (2) $ (1)
======== ======== ====== ======
</TABLE>
- ------------------------------------
* For detail on capital share transactions by class, see Statements of
Changes in Net Assets (Capital Stock Activity) on pages 98 and 99.
** Period from December 15, 1999 (commencement of operations) to December 31,
1999.
*** Period from December 31, 1998 (commencement of operations) to December 31,
1998.
The accompanying notes are an integral part of the financial statements.
Page 94
<PAGE>
Dresdner RCM Global Funds
Statements of Changes in Net Assets
(All numbers in thousands)
<TABLE>
<CAPTION>
EUROPE FUND GLOBAL EQUITY FUND
---------------------------- -------------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DEC. 31, 1999 DEC. 31, 1998 DEC. 31, 1999 DEC. 31, 1998***
------------- ------------- ------------- ----------------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss) $ (110) $ (666) $ (3) $ --
Net realized gain (loss) on investments, foreign
currency transactions and options written 34,049 50,945 140 --
Net change in unrealized appreciation
(depreciation) on investments, foreign currency
translations and options written (21,415) 13,394 482 --
--------- -------- ------ ------
Net increase (decrease) in net assets resulting from
operations 12,524 63,673 619 --
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Class I shares:
Net investment income -- -- -- --
In excess of net investment income -- -- (6) --
Net realized gain on investments -- -- (29) --
In excess of net realized gain on investments -- -- -- --
--------- -------- ------ ------
Total distributions, Class I -- -- (35) --
--------- -------- ------ ------
Class N shares:
Net investment income -- (2,381) -- --
In excess of net investment income (336) -- -- --
Net realized gain on investments (16,858) (46,368) -- --
In excess of net realized gain on investments -- -- -- --
--------- -------- ------ ------
Total distributions, Class N (17,194) (48,749) -- --
--------- -------- ------ ------
Total distributions to shareholders (17,194) (48,749) (35) --
NET INCREASE (DECREASE) FROM CAPITAL SHARE
TRANSACTIONS* (119,298) -- -- 1,000
Redemption fees (Note 1) 540 -- -- --
--------- -------- ------ ------
TOTAL INCREASE (DECREASE) IN NET ASSETS (123,428) 14,924 584 1,000
NET ASSETS:
Beginning of period 191,338 176,414 1,000 --
--------- -------- ------ ------
End of period $ 67,910 $191,338 $1,584 $1,000
========= ======== ====== ======
End of period net assets include net investment
income (loss) of: $ (17) $ (2,619) $ (1) $ --
========= ======== ====== ======
<CAPTION>
STRATEGIC INCOME FUND BALANCED FUND
------------------------------- ---------------
YEAR ENDED YEAR ENDED YEAR ENDED
DEC. 31, 1999 DEC. 31, 1998*** DEC. 31, 1999**
------------- ---------------- ---------------
<S> <C> <C> <C>
OPERATIONS:
Net investment income (loss) $ 159 $ -- $ 1
Net realized gain (loss) on investments, foreign
currency transactions and options written (28) -- 5
Net change in unrealized appreciation
(depreciation) on investments, foreign currency
translations and options written (52) -- 56
------ ------ ------
Net increase (decrease) in net assets resulting from
operations 79 -- 62
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Class I shares:
Net investment income (159) -- --
In excess of net investment income (54) -- --
Net realized gain on investments -- -- --
In excess of net realized gain on investments -- -- --
------ ------ ------
Total distributions, Class I (213) -- --
------ ------ ------
Class N shares:
Net investment income -- -- --
In excess of net investment income -- -- --
Net realized gain on investments -- -- --
In excess of net realized gain on investments -- -- --
------ ------ ------
Total distributions, Class N -- -- --
------ ------ ------
Total distributions to shareholders (213) -- --
NET INCREASE (DECREASE) FROM CAPITAL SHARE
TRANSACTIONS* -- 3,000 947
Redemption fees (Note 1) -- -- --
------ ------ ------
TOTAL INCREASE (DECREASE) IN NET ASSETS (134) 3,000 1,009
NET ASSETS:
Beginning of period 3,000 -- --
------ ------ ------
End of period $2,866 $3,000 $1,009
====== ====== ======
End of period net assets include net investment
income (loss) of: $ (29) $ -- $ 1
====== ====== ======
</TABLE>
- ------------------------------------
* For detail on capital share transactions by class, see Statements of
Changes in Net Assets (Capital Stock Activity) on pages 98 and 99.
** Period from December 15, 1999 (commencement of operations) to December 31,
1999.
*** Period from December 31, 1998 (commencement of operations) to December 31,
1998.
The accompanying notes are an integral part of the financial statements.
Page 95
<PAGE>
Dresdner RCM Global Funds
Statements of Changes in Net Assets
Capital Stock Activity
(All numbers in thousands)
<TABLE>
<CAPTION>
LARGE CAP GROWTH FUND BIOTECHNOLOGY FUND
---------------------------- ----------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DEC. 31, 1999 DEC. 31, 1998 DEC. 31, 1999 DEC. 31, 1998
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
FUND SHARE TRANSACTIONS
DOLLAR AMOUNTS
Class I shares:
Sold $ 7,126 $ 6,444 $ -- $ --
Issued to shareholders in reinvestment of
distributions 2,468 9 -- --
Repurchased (4,708) (5,000) -- --
---------- ----------- ---------- ----------
Net increase (decrease), Class I $ 4,886 $ 1,453 $ -- $ --
========== =========== ========== ==========
Class N shares:
Sold $ 875 $ -- $ 6,483 $ 482
Issued to shareholders in reinvestment of
distributions 40 -- 872 10
Repurchased (7) -- (794) (70)
---------- ----------- ---------- ----------
Net increase (decrease), Class N $ 908 $ -- $ 6,561 $ 422
========== =========== ========== ==========
SHARE AMOUNTS
Class I shares:
Sold 414 403 -- --
Issued to shareholders in reinvestment of
distributions 140 1 -- --
Repurchased (265) (313) -- --
---------- ----------- ---------- ----------
Net increase (decrease), Class I 289 91 -- --
========== =========== ========== ==========
Class N shares:
Sold 47 -- 401 48
Issued to shareholders in reinvestment of
distributions 2 -- 55 1
Repurchased -- (55) (7)
---------- ----------- ---------- ----------
Net increase (decrease), Class N 49 -- 401 42
========== =========== ========== ==========
PURCHASES AND SALES OF INVESTMENT SECURITIES:
(EXCLUDING SHORT-TERM SECURITIES)
Purchases of securities $ 17,147 $ 5,615 $ 27,104 $ 6,545
Proceeds from sales of securities 12,789 6,264 24,690 3,326
</TABLE>
- ------------------------------------
* Period from December 15, 1999 (commencement of operations) to December 31,
1999.
** Period from December 31, 1998 (commencement of operations) to December 31,
1998.
The accompanying notes are an integral part of the financial statements.
Page 96
<PAGE>
Dresdner RCM Global Funds
Statements of Changes in Net Assets
Capital Stock Activity
(All numbers in thousands)
<TABLE>
<CAPTION>
TAX MANAGED GROWTH FUND GLOBAL SMALL CAP FUND
------------------------------ ----------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DEC. 31, 1999 DEC. 31, 1998** DEC. 31, 1999 DEC. 31, 1998
------------- --------------- ------------- -------------
<S> <C> <C> <C> <C>
FUND SHARE TRANSACTIONS
DOLLAR AMOUNTS
Class I shares:
Sold $ -- $ 1,000 $ 13,423 $ 770
Issued to shareholders in reinvestment of
distributions -- -- 154 32
Repurchased -- -- (920) (217)
---------- ---------- ---------- ----------
Net increase (decrease), Class I $ -- $ 1,000 $ 12,657 $ 585
========== ========== ========== ==========
Class N shares:
Sold $ 649 $ -- $ 1,118 $ --
Issued to shareholders in reinvestment of
distributions 6 -- 85 --
Repurchased -- -- (20) --
---------- ---------- ---------- ----------
Net increase (decrease), Class N $ 655 $ -- $ 1,183 $ --
========== ========== ========== ==========
SHARE AMOUNTS
Class I shares:
Sold -- 100 636 58
Issued to shareholders in reinvestment of
distributions -- -- 7 2
Repurchased -- -- (56) (19)
---------- ---------- ---------- ----------
Net increase (decrease), Class I -- 100 587 41
========== ========== ========== ==========
Class N shares:
Sold 51 -- 58 --
Issued to shareholders in reinvestment of
distributions -- -- 4 --
Repurchased -- -- (1) --
---------- ---------- ---------- ----------
Net increase (decrease), Class N 51 -- 61 --
========== ========== ========== ==========
PURCHASES AND SALES OF INVESTMENT SECURITIES:
(EXCLUDING SHORT-TERM SECURITIES)
Purchases of securities $ 2,141 $ -- $ 24,604 $ 9,265
Proceeds from sales of securities 593 -- 12,387 9,231
<CAPTION>
GLOBAL TECHNOLOGY FUND GLOBAL HEALTH CARE FUND
---------------------------- ----------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DEC. 31, 1999 DEC. 31, 1998 DEC. 31, 1999 DEC. 31, 1998
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
FUND SHARE TRANSACTIONS
DOLLAR AMOUNTS
Class I shares:
Sold $ 125,712 $ 8,186 $ -- $ --
Issued to shareholders in reinvestment of
distributions 4,025 440 -- --
Repurchased (31,266) (2,212) -- --
----------- ----------- ---------- ----------
Net increase (decrease), Class I $ 98,471 $ 6,414 $ -- $ --
=========== =========== ========== ==========
Class N shares:
Sold $ 64,142 $ -- $ 748 $ 121
Issued to shareholders in reinvestment of
distributions 1,438 -- 67 9
Repurchased (7,987) -- (388) (26)
----------- ----------- ---------- ----------
Net increase (decrease), Class N $ 57,593 $ -- $ 427 $ 104
=========== =========== ========== ==========
SHARE AMOUNTS
Class I shares:
Sold 3,164 474 -- --
Issued to shareholders in reinvestment of
distributions 76 21 -- --
Repurchased (765) (135) -- --
----------- ----------- ---------- ----------
Net increase (decrease), Class I 2,475 360 -- --
=========== =========== ========== ==========
Class N shares:
Sold 1,564 -- 56 9
Issued to shareholders in reinvestment of
distributions 27 -- 5 1
Repurchased (199) -- (29) (2)
----------- ----------- ---------- ----------
Net increase (decrease), Class N 1,392 -- 32 8
=========== =========== ========== ==========
PURCHASES AND SALES OF INVESTMENT SECURITIES:
(EXCLUDING SHORT-TERM SECURITIES)
Purchases of securities $ 211,880 $ 26,910 $ 21,409 $ 7,670
Proceeds from sales of securities 80,869 23,828 22,322 7,857
</TABLE>
- ------------------------------------
* Period from December 15, 1999 (commencement of operations) to December 31,
1999.
** Period from December 31, 1998 (commencement of operations) to December 31,
1998.
The accompanying notes are an integral part of the financial statements.
Page 97
<PAGE>
Dresdner RCM Global Funds
Statements of Changes in Net Assets
Capital Stock Activity
(All numbers in thousands)
<TABLE>
<CAPTION>
INTERNATIONAL GROWTH EQUITY
FUND EMERGING MARKETS FUND
---------------------------- ----------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DEC. 31, 1999 DEC. 31, 1998 DEC. 31, 1999 DEC. 31, 1998
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
FUND SHARE TRANSACTIONS
DOLLAR AMOUNTS
Class I shares:
Sold $ 182,299 $ 21,109 $ 56 $ 20
Issued to shareholders in reinvestment of
distributions 17,745 4,362 2 --
Repurchased (119,912) (11,673) (17) (4)
------------ ------------ ---------- ----------
Net increase (decrease), Class I $ 80,132 $ 13,798 $ 41 $ 16
============ ============ ========== ==========
Class N shares:
Sold $ 2,341 $ -- $ 253 $ --
Issued to shareholders in reinvestment of
distributions 61 -- 5 --
Repurchased (852) -- (18) --
------------ ------------ ---------- ----------
Net increase (decrease), Class N $ 1,550 $ -- $ 240 $ --
============ ============ ========== ==========
SHARE AMOUNTS
Class I shares:
Sold 10,871 1,461 5 2
Issued to shareholders in reinvestment of
distributions 872 307 -- --
Repurchased (7,103) (809) (1) --
------------ ------------ ---------- ----------
Net increase (decrease), Class I 4,640 959 4 2
============ ============ ========== ==========
Class N shares:
Sold 130 -- 19 --
Issued to shareholders in reinvestment of
distributions 3 -- -- --
Repurchased (55) -- (1) --
------------ ------------ ---------- ----------
Net increase (decrease), Class N 78 -- 18 --
============ ============ ========== ==========
PURCHASES AND SALES OF INVESTMENT SECURITIES:
(EXCLUDING SHORT-TERM SECURITIES)
Purchases of securities $ 280,952 $ 113,487 $ 7,324 $ 7,092
Proceeds from sales of securities 224,692 95,449 7,103 6,476
</TABLE>
- ------------------------------------
* Period from December 15, 1999 (commencement of operations) to December 31,
1999.
** Period from December 31, 1998 (commencement of operations) to December 31,
1998.
The accompanying notes are an integral part of the financial statements.
Page 98
<PAGE>
Dresdner RCM Global Funds
Statements of Changes in Net Assets
Capital Stock Activity
(All numbers in thousands)
<TABLE>
<CAPTION>
EUROPE FUND GLOBAL EQUITY FUND
---------------------------- ------------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DEC. 31, 1999 DEC. 31, 1998 DEC. 31, 1999 DEC. 31, 1998**
------------- ------------- ------------- ---------------
<S> <C> <C> <C> <C>
FUND SHARE TRANSACTIONS
DOLLAR AMOUNTS
Class I shares:
Sold $ -- $ -- $ -- $ 1,000
Issued to shareholders in reinvestment of
distributions -- -- -- --
Repurchased -- -- -- --
------------ ------------ ---------- ----------
Net increase (decrease), Class I $ -- $ -- $ -- $ 1,000
============ ============ ========== ==========
Class N shares:
Sold $ 10,001 $ -- $ -- $ --
Issued to shareholders in reinvestment of
distributions 8,465 -- -- --
Repurchased (137,764) -- -- --
------------ ------------ ---------- ----------
Net increase (decrease), Class N $ (119,298) $ -- $ -- $ --
============ ============ ========== ==========
SHARE AMOUNTS
Class I shares:
Sold -- -- -- 100
Issued to shareholders in reinvestment of
distributions -- -- -- --
Repurchased -- -- -- --
------------ ------------ ---------- ----------
Net increase (decrease), Class I -- -- -- 100
============ ============ ========== ==========
Class N shares:
Sold 583 -- -- --
Issued to shareholders in reinvestment of
distributions 535 -- -- --
Repurchased (10,914) -- -- --
------------ ------------ ---------- ----------
Net increase (decrease), Class N (9,796) -- -- --
============ ============ ========== ==========
PURCHASES AND SALES OF INVESTMENT SECURITIES:
(EXCLUDING SHORT-TERM SECURITIES)
Purchases of securities $ 202,304 $ 237,506 $ 2,077 $ --
Proceeds from sales of securities 362,350 260,361 1,617 --
<CAPTION>
STRATEGIC INCOME FUND BALANCED FUND
------------------------------ --------------
YEAR ENDED YEAR ENDED YEAR ENDED
DEC. 31, 1999 DEC. 31, 1998** DEC. 31, 1999*
------------- --------------- --------------
<S> <C> <C> <C>
FUND SHARE TRANSACTIONS
DOLLAR AMOUNTS
Class I shares:
Sold $ -- $ 3,000 $ 947
Issued to shareholders in reinvestment of
distributions -- -- --
Repurchased -- -- --
---------- ---------- -----------
Net increase (decrease), Class I $ -- $ 3,000 $ 947
========== ========== ===========
Class N shares:
Sold $ -- $ -- $ --
Issued to shareholders in reinvestment of
distributions -- -- --
Repurchased -- -- --
---------- ---------- -----------
Net increase (decrease), Class N $ -- $ -- $ --
========== ========== ===========
SHARE AMOUNTS
Class I shares:
Sold -- 300 95
Issued to shareholders in reinvestment of
distributions -- -- --
Repurchased -- -- --
---------- ---------- -----------
Net increase (decrease), Class I -- 300 95
========== ========== ===========
Class N shares:
Sold -- -- --
Issued to shareholders in reinvestment of
distributions -- -- --
Repurchased -- -- --
---------- ---------- -----------
Net increase (decrease), Class N -- -- --
========== ========== ===========
PURCHASES AND SALES OF INVESTMENT SECURITIES:
(EXCLUDING SHORT-TERM SECURITIES)
Purchases of securities $ 11,635 $ -- $ 1,475
Proceeds from sales of securities 8,896 -- 551
</TABLE>
- ------------------------------------
* Period from December 15, 1999 (commencement of operations) to December 31,
1999.
** Period from December 31, 1998 (commencement of operations) to December 31,
1998.
The accompanying notes are an integral part of the financial statements.
Page 99
<PAGE>
Dresdner RCM Global Funds
Financial Highlights
For a share outstanding throughout each fiscal year or period ended:
<TABLE>
<CAPTION>
LARGE CAP GROWTH FUND
----------------------------------------------------------
CLASS I CLASS N
---------------------------------------------- -------
DECEMBER 31,
----------------------------------------------------------
1999 1998 1997 1996(3) 1999(9)
------- -------- -------- -------- -------
<S> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE: (1)
Net asset value, beginning of period $ 16.14 $12.53 $ 10.00 $10.00 $ 16.60
------- ------ ------- ------ -------
Income from investment operations:
Net investment income (loss) (0.05) (0.02) 0.01 -- (0.08)
Net realized and unrealized gain on
investments 6.95 5.51 3.17 -- 6.45
------- ------ ------- ------ -------
Total from investment operations 6.90 5.49 3.18 -- 6.37
Less distributions:
From net investment income -- (0.01) (0.01) -- --
From net realized gain on investments (3.97) (1.87) (0.64) -- (3.97)
------- ------ ------- ------ -------
Total distributions (3.97) (1.88) (0.65) -- (3.97)
------- ------ ------- ------ -------
NET ASSET VALUE, END OF PERIOD $ 19.07 $16.14 $ 12.53 $10.00 $ 19.00
------- ------ ------- ------ -------
------- ------ ------- ------ -------
TOTAL RETURN (7) 44.84% 44.11% 31.99% 0.00% 40.48%
------- ------ ------- ------ -------
------- ------ ------- ------ -------
RATIOS AND SUPPLEMENTAL DATA:
Net assets, end of period (in 000's) $14,898 $7,935 $ 5,025 $4,000 $ 926
------- ------ ------- ------ -------
------- ------ ------- ------ -------
Ratio of expenses to average net assets:
With waiver and reimbursement (15) 0.95% 0.95% 0.95% 0.00%(8) 1.20%
------- ------ ------- ------ -------
------- ------ ------- ------ -------
Without waiver and reimbursement (15) 2.45% 3.04% 2.63% -- 60.04%
------- ------ ------- ------ -------
------- ------ ------- ------ -------
Ratio of net investment income to average net
assets:
With waiver and reimbursement (15) (0.26)% (0.11)% 0.10% 0.00%(8) (0.55)%
------- ------ ------- ------ -------
------- ------ ------- ------ -------
Without waiver and reimbursement (15) (1.76)% (2.20)% (1.58)% -- (59.39)%
------- ------ ------- ------ -------
------- ------ ------- ------ -------
Portfolio turnover 109.29% 99.58% 119.87% 0.00% 109.29%
------- ------ ------- ------ -------
------- ------ ------- ------ -------
</TABLE>
- ------------------------------------
For Footnote References, see "Notes to Financial Highlights."
<TABLE>
<CAPTION>
BIOTECHNOLOGY FUND
---------------------------------
CLASS N
---------------------------------
DECEMBER 31,
---------------------------------
1999 1998 1997(4)
------- -------- --------
<S> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE: (1)
Net asset value, beginning of period $ 11.44 $ 10.00 $10.00
------- ------- ------
Income from investment operations:
Net investment loss (0.15) (0.10) --
Net realized and unrealized gain on investments 12.03 1.86 --
------- ------- ------
Total from investment operations 11.88 1.76 --
Less distributions:
From net realized gain on investments (3.30) (0.32) --
------- ------- ------
NET ASSET VALUE, END OF PERIOD $ 20.02 $ 11.44 $10.00
------- ------- ------
------- ------- ------
TOTAL RETURN (7) 111.39% 17.76% 0.00%
------- ------- ------
------- ------- ------
RATIOS AND SUPPLEMENTAL DATA:
Net assets, end of period (in 000's) $14,870 $ 3,911 $3,000
------- ------- ------
------- ------- ------
Ratio of expenses to average net assets:
With waiver and reimbursement (15) 1.50% 1.50% 0.01%(8)
------- ------- ------
------- ------- ------
Without waiver and reimbursement (15) 4.53% 4.87% --
------- ------- ------
------- ------- ------
Ratio of net investment income to average net assets:
With waiver and reimbursement (15) (1.09)% (0.95)% 0.01%(8)
------- ------- ------
------- ------- ------
Without waiver and reimbursement (15) (4.12)% (4.32)% --
------- ------- ------
------- ------- ------
Portfolio turnover 431.27% 127.21% 0.00%
------- ------- ------
------- ------- ------
</TABLE>
- ------------------------------------
For Footnote References, see "Notes to Financial Highlights."
Page 100
<PAGE>
Dresdner RCM Global Funds
Financial Highlights
For a share outstanding throughout each fiscal year or period ended:
<TABLE>
<CAPTION>
TAX MANAGED GROWTH FUND
---------------------------------
CLASS I CLASS N
-------------------- --------
DECEMBER 31,
---------------------------------
1999 1998(5) 1999(10)
------- -------- --------
<S> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE: (1)
Net asset value, beginning of period $ 10.00 $10.00 $ 10.34
------- ------ -------
Income from investment operations:
Net investment loss (0.06) -- (0.29)
Net realized and unrealized gain on
investments 5.28 -- 5.13
------- ------ -------
Total from investment operations 5.22 -- 4.84
Less distributions:
From net realized gain on investments (0.21) -- (0.21)
In excess of net realized gain on investments (0.02) -- (0.02)
------- ------ -------
Total distributions (0.23) -- (0.23)
------- ------ -------
NET ASSET VALUE, END OF PERIOD $ 14.99 $10.00 $ 14.95
------- ------ -------
------- ------ -------
TOTAL RETURN (7) 52.44% 0.00% 47.07%
------- ------ -------
------- ------ -------
RATIOS AND SUPPLEMENTAL DATA:
Net assets, end of period (in 000's) $ 1,499 $1,000 $ 759
------- ------ -------
------- ------ -------
Ratio of expenses to average net assets:
With waiver and reimbursement (15) 1.25% 0.00%(8) 1.50%
------- ------ -------
------- ------ -------
Without waiver and reimbursement (15) 14.36% -- 35.08%
------- ------ -------
------- ------ -------
Ratio of net investment income to average net
assets:
With waiver and reimbursement (15) (0.47)% 0.00%(8) (2.66)%
------- ------ -------
------- ------ -------
Without waiver and reimbursement (15) (13.58)% -- (36.24)%
------- ------ -------
------- ------ -------
Portfolio turnover 43.35% 0.00% 43.35%
------- ------ -------
------- ------ -------
</TABLE>
- ------------------------------------
For Footnote References, see "Notes to Financial Highlights."
<TABLE>
<CAPTION>
GLOBAL SMALL CAP FUND
-----------------------------------------------------------
CLASS I CLASS N
---------------------------------------------- --------
DECEMBER 31,
-----------------------------------------------------------
1999 1998 1997 1996(3) 1999(11)
------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE: (1)
Net asset value, beginning of period $ 12.37 $ 11.09 $ 10.00 $10.00 $ 11.63
------- ------- ------- ------ -------
Income from investment operations:
Net investment loss (0.17) (0.13) (0.13) -- (0.21)
Net realized and unrealized gain on investments 12.96 2.23 2.64 -- 13.67
------- ------- ------- ------ -------
Total from investment operations 12.79 2.10 2.51 -- 13.46
Less distributions:
From net realized gain on investments (1.78) (0.82) (1.42) -- (1.78)
------- ------- ------- ------ -------
NET ASSET VALUE, END OF PERIOD $ 23.38 $ 12.37 $ 11.09 $10.00 $ 23.31
------- ------- ------- ------ -------
------- ------- ------- ------ -------
TOTAL RETURN (7) 104.63% 19.29% 25.48% 0.00% 116.97%
------- ------- ------- ------ -------
------- ------- ------- ------ -------
RATIOS AND SUPPLEMENTAL DATA:
Net assets, end of period (in 000's) $24,073 $ 5,479 $ 4,456 $4,000 $ 1,430
------- ------- ------- ------ -------
------- ------- ------- ------ -------
Ratio of expenses to average net assets:
With waiver and reimbursement (15) 1.50% 1.75% 1.75% 0.00%(8) 1.75%
------- ------- ------- ------ -------
------- ------- ------- ------ -------
Without waiver and reimbursement (15) 4.10% 3.86% 3.09% -- 16.71%
------- ------- ------- ------ -------
------- ------- ------- ------ -------
Ratio of net investment income to average net assets:
With waiver and reimbursement (15) (1.13)% (1.03)% (1.14)% 0.00%(8) (1.49)%
------- ------- ------- ------ -------
------- ------- ------- ------ -------
Without waiver and reimbursement (15) (3.73)% (3.14)% (2.49)% -- (16.44)%
------- ------- ------- ------ -------
------- ------- ------- ------ -------
Portfolio turnover 161.61% 184.38% 153.49% 0.00% 161.61%
------- ------- ------- ------ -------
------- ------- ------- ------ -------
</TABLE>
- ------------------------------------
For Footnote References, see "Notes to Financial Highlights."
Page 101
<PAGE>
Dresdner RCM Global Funds
Financial Highlights
For a share outstanding throughout each fiscal year or period ended:
<TABLE>
<CAPTION>
GLOBAL TECHNOLOGY FUND
-------------------------------------------------------------------------
CLASS I CLASS N
------------------------------------------------------------ --------
DECEMBER 31,
-------------------------------------------------------------------------
1999 1998 1997 1996 1995(2) 1999(12)
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE: (1)
Net asset value, beginning of period $ 21.40 $ 13.69 $ 12.60 $ 10.04 $10.00 $ 24.01
-------- ------- ------- ------- ------ -------
Income from investment operations:
Net investment loss (0.35) (0.16) (0.16) (0.15) -- (0.49)
Net realized and unrealized gain on
investments 39.54 8.44 3.46 2.80 0.04 36.99
-------- ------- ------- ------- ------ -------
Total from investment operations 39.19 8.28 3.30 2.65 0.04 36.50
Less distributions:
From net realized gain on investments (1.38) (0.57) (2.21) (0.09) -- (1.38)
-------- ------- ------- ------- ------ -------
NET ASSET VALUE, END OF PERIOD $ 59.21 $ 21.40 $ 13.69 $ 12.60 $10.04 $ 59.13
-------- ------- ------- ------- ------ -------
-------- ------- ------- ------- ------ -------
TOTAL RETURN (7) 182.95% 60.53% 27.08% 26.41% 0.40% 152.69%
-------- ------- ------- ------- ------ -------
-------- ------- ------- ------- ------ -------
RATIOS AND SUPPLEMENTAL DATA:
Net assets, end of period (in 000's) $197,897 $18,558 $ 6,950 $ 5,117 $ 954 $82,330
-------- ------- ------- ------- ------ -------
-------- ------- ------- ------- ------ -------
Ratio of expenses to average net assets:
With waiver and reimbursement (15) 1.50% 1.75% 1.75% 1.73% 0.00%(8) 1.75%
-------- ------- ------- ------- ------ -------
-------- ------- ------- ------- ------ -------
Without waiver and reimbursement (15) 1.50% 2.49% 2.45% 7.75% -- 1.99%
-------- ------- ------- ------- ------ -------
-------- ------- ------- ------- ------ -------
Ratio of net investment income to average net
assets:
With waiver and reimbursement (15) (1.02)% (0.99)% (1.15)% (1.34)% (0.02)%(8) (1.32)%
-------- ------- ------- ------- ------ -------
-------- ------- ------- ------- ------ -------
Without waiver and reimbursement (15) (1.02)% (1.73)% (1.86)% 7.36% -- (1.56)%
-------- ------- ------- ------- ------ -------
-------- ------- ------- ------- ------ -------
Portfolio turnover 119.32% 265.99% 189.41% 155.58% 0.00% 119.32%
-------- ------- ------- ------- ------ -------
-------- ------- ------- ------- ------ -------
</TABLE>
- ------------------------------------
For Footnote References, see "Notes to Financial Highlights."
<TABLE>
<CAPTION>
GLOBAL HEALTH CARE FUND
----------------------------------------------
CLASS N
----------------------------------------------
DECEMBER 31,
----------------------------------------------
1999 1998 1997 1996(3)
------- -------- -------- --------
<S> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE: (1)
Net asset value, beginning of period $ 13.42 $ 11.65 $ 10.00 $10.00
------- ------- ------- ------
Income from investment operations:
Net investment loss (0.11) (0.09) (0.06) --
Net realized and unrealized gain on investments 3.53 3.02 3.03 --
------- ------- ------- ------
Total from investment operations 3.42 2.93 2.97 --
Less distributions:
From net realized gain on investments (2.59) (1.16) (1.32) --
------- ------- ------- ------
NET ASSET VALUE, END OF PERIOD $ 14.25 $ 13.42 $ 11.65 $10.00
------- ------- ------- ------
------- ------- ------- ------
TOTAL RETURN (7) 28.74% 25.57% 30.00% 0.00%
------- ------- ------- ------
------- ------- ------- ------
RATIOS AND SUPPLEMENTAL DATA:
Net assets, end of period (in 000's) $ 6,284 $ 5,487 $ 4,671 $4,000
------- ------- ------- ------
------- ------- ------- ------
Ratio of expenses to average net assets:
With waiver and reimbursement (15) 1.50% 1.50% 1.50% 0.00%(8)
------- ------- ------- ------
------- ------- ------- ------
Without waiver and reimbursement (15) 4.85% 3.65% 2.93% --
------- ------- ------- ------
------- ------- ------- ------
Ratio of net investment income to average net assets:
With waiver and reimbursement (15) (0.81)% (0.69)% (0.55)% 0.00%(8)
------- ------- ------- ------
------- ------- ------- ------
Without waiver and reimbursement (15) (4.16)% (2.84)% (1.98)% --
------- ------- ------- ------
------- ------- ------- ------
Portfolio turnover 393.83% 153.92% 157.65% 0.00%
------- ------- ------- ------
------- ------- ------- ------
</TABLE>
- ------------------------------------
For Footnote References, see "Notes to Financial Highlights."
Page 102
<PAGE>
Dresdner RCM Global Funds
Financial Highlights
For a share outstanding throughout each fiscal year or period ended:
<TABLE>
<CAPTION>
INTERNATIONAL GROWTH EQUITY FUND
--------------------------------------------------------------------------
CLASS I CLASS N
------------------------------------------------------------- --------
DECEMBER 31,
--------------------------------------------------------------------------
1999 1998 1997 1996(6) 1995 1999(11)
-------- --------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE: (1)
Net asset value, beginning of period $ 14.98 $ 13.70 $ 12.72 $ 11.56 $ 10.00 $ 14.78
-------- -------- ------- ------- ------- -------
Income from investment operations:
Net investment income 0.02 0.06 0.06 0.04 0.12 0.01
Net realized and unrealized gain on
investments 8.91 1.80 2.22 2.16 1.68 9.08
-------- -------- ------- ------- ------- -------
Total from investment operations 8.93 1.86 2.28 2.20 1.80 9.09
Less distributions:
From net investment income (0.07) (0.23) (0.14) (0.16) (0.11) (0.07)
In excess of net investment income (0.10) -- -- -- -- (0.09)
From net realized gain on investments (1.40) (0.35) (1.16) (0.88) (0.13) (1.40)
-------- -------- ------- ------- ------- -------
Total distributions (1.57) (0.58) (1.30) (1.04) (0.24) (1.56)
-------- -------- ------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD $ 22.34 $ 14.98 $ 13.70 $ 12.72 $ 11.56 $ 22.31
-------- -------- ------- ------- ------- -------
-------- -------- ------- ------- ------- -------
TOTAL RETURN (7) 60.66% 13.81% 17.93% 19.31% 17.98% 62.48%
-------- -------- ------- ------- ------- -------
-------- -------- ------- ------- ------- -------
RATIOS AND SUPPLEMENTAL DATA:
Net assets, end of period (in 000's) $285,561 $121,975 $98,443 $52,605 $34,347 $ 1,738
-------- -------- ------- ------- ------- -------
-------- -------- ------- ------- ------- -------
Ratio of expenses to average net assets:
With waiver and reimbursement (15) 1.00% 1.00% 1.00% 0.99% 0.75% 1.25%
-------- -------- ------- ------- ------- -------
-------- -------- ------- ------- ------- -------
Without waiver and reimbursement (15) 1.06% 1.06% 1.06% 1.25% 1.11% 10.89%
-------- -------- ------- ------- ------- -------
-------- -------- ------- ------- ------- -------
Ratio of net investment income to average net
assets:
With waiver and reimbursement (15) 0.12% 0.37% 0.41% 0.32% 1.19% 0.07%
-------- -------- ------- ------- ------- -------
-------- -------- ------- ------- ------- -------
Without waiver and reimbursement (15) 0.06% 0.31% 0.35% 0.06% 0.83% (9.56)%
-------- -------- ------- ------- ------- -------
-------- -------- ------- ------- ------- -------
Portfolio turnover 139.69% 84.49% 122.43% 119.09% 87.40% 139.69%
-------- -------- ------- ------- ------- -------
-------- -------- ------- ------- ------- -------
</TABLE>
- ------------------------------------
For Footnote References, see "Notes to Financial Highlights."
<TABLE>
<CAPTION>
EMERGING MARKETS FUND
----------------------------------------------
CLASS I CLASS N
--------------------------------- --------
DECEMBER 31,
----------------------------------------------
1999 1998 1997(4) 1999(11)
------- -------- -------- --------
<S> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE: (1)
Net asset value, beginning of period $ 9.06 $ 9.99 $10.00 $ 9.13
------- ------- ------ -------
Income from investment operations:
Net investment income (loss) (0.01) 0.12 -- (0.06)
Net realized and unrealized gain (loss) on
investments 8.29 (0.97) (0.01) 8.24
------- ------- ------ -------
Total from investment operations 8.28 (0.85) (0.01) 8.18
Less distributions:
From net investment income -- (0.08) -- --
From net realized gain on investments (0.47) -- -- (0.47)
------- ------- ------ -------
Total distributions (0.47) (0.08) -- (0.47)
------- ------- ------ -------
NET ASSET VALUE, END OF PERIOD $ 16.87 $ 9.06 $ 9.99 $ 16.84
------- ------- ------ -------
------- ------- ------ -------
TOTAL RETURN (7) 92.12% (8.50)% -- 90.31%
------- ------- ------ -------
------- ------- ------ -------
RATIOS AND SUPPLEMENTAL DATA:
Net assets, end of period (in 000's) $ 5,154 $ 2,734 $2,996 $ 299
------- ------- ------ -------
------- ------- ------ -------
Ratio of expenses to average net assets:
With waiver and reimbursement (15) 1.50% 1.50% 0.01%(8) 1.75%
------- ------- ------ -------
------- ------- ------ -------
Without waiver and reimbursement (15) 9.33% 8.29% -- 79.18%
------- ------- ------ -------
------- ------- ------ -------
Ratio of net investment income to average net
assets:
With waiver and reimbursement (15) (0.13)% 1.23% -- (0.68)%
------- ------- ------ -------
------- ------- ------ -------
Without waiver and reimbursement (15) (7.96)% (5.56)% -- (78.11)%
------- ------- ------ -------
------- ------- ------ -------
Portfolio turnover 215.64% 279.25% --(8) 215.64%
------- ------- ------ -------
------- ------- ------ -------
</TABLE>
- ------------------------------------
For Footnote References, see "Notes to Financial Highlights."
Page 103
<PAGE>
Dresdner RCM Global Funds
Financial Highlights
For a share outstanding throughout each fiscal year or period ended:
<TABLE>
<CAPTION>
EUROPE FUND
----------------------------------------------------------------
CLASS N
----------------------------------------------------------------
DECEMBER 31,
----------------------------------------------------------------
1999(1) 1998(1) 1997(1) 1996(1) 1995
-------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of year $ 13.66 $ 12.59 $ 10.66 $ 9.20 $ 9.20
-------- -------- -------- -------- --------
Income from investment operations:
Net investment income (loss) (0.01) (0.05) 0.01 0.03 0.07
Net realized and unrealized gain (loss) on
investments 5.66 4.60 2.70 1.45 (0.07)
-------- -------- -------- -------- --------
Total from investment operations 5.65 4.55 2.71 1.48 0.00
Less distributions:
From net investment income -- (0.17) (0.06) (0.02) --
In excess of net investment income (0.02) -- -- -- --
From net realized gain on investments (3.17) (3.31) (0.72) -- --
-------- -------- -------- -------- --------
Total distributions (3.19) (3.48) (0.78) (0.02) --
-------- -------- -------- -------- --------
NET ASSET VALUE, END OF YEAR $ 16.12 $ 13.66 $ 12.59 $ 10.66 $ 9.20
-------- -------- -------- -------- --------
-------- -------- -------- -------- --------
TOTAL RETURN (7) 43.59% 37.23% 25.70% 15.87% 1.33%
-------- -------- -------- -------- --------
-------- -------- -------- -------- --------
RATIOS AND SUPPLEMENTAL DATA:
Net assets, end of period (in 000's) $ 67,910 $191,338 $176,414 $149,299 $128,932
-------- -------- -------- -------- --------
-------- -------- -------- -------- --------
Ratio of expenses to average net assets: (13)
With waiver and reimbursement 1.03% -- -- -- --
-------- -------- -------- -------- --------
-------- -------- -------- -------- --------
Without waiver and reimbursement 2.01% 1.97% 1.30% 1.42% 1.51%
-------- -------- -------- -------- --------
-------- -------- -------- -------- --------
Ratio of net investment income to average net assets:
With waiver and reimbursement (0.11)% -- -- -- --
-------- -------- -------- -------- --------
-------- -------- -------- -------- --------
Without waiver and reimbursement (1.08)% (0.31)% 0.06% 0.33% 0.76%
-------- -------- -------- -------- --------
-------- -------- -------- -------- --------
Portfolio turnover 202.90% 114.00% 85.00% 51.00% 40.00%
-------- -------- -------- -------- --------
-------- -------- -------- -------- --------
</TABLE>
- ------------------------------------
For Footnote References, see "Notes to Financial Highlights."
<TABLE>
<CAPTION>
GLOBAL EQUITY FUND
--------------------
CLASS I
--------------------
DECEMBER 31,
--------------------
1999 1998(5)
------- --------
<S> <C> <C>
PER SHARE OPERATING PERFORMANCE: (1)
Net asset value, beginning of period $ 10.00 $10.00
------- ------
Income from investment operations:
Net investment loss (0.03) --
Net realized and unrealized gain on investments 6.22 --
------- ------
Total from investment operations 6.19 --
Less distributions:
In excess of net investment income (0.06) --
From net realized gain on investments (0.29) --
------- ------
Total distributions (0.35) --
------- ------
NET ASSET VALUE, END OF PERIOD $ 15.84 $10.00
------- ------
------- ------
TOTAL RETURN (7) 62.20% 0.00%
------- ------
------- ------
RATIOS AND SUPPLEMENTAL DATA:
Net assets, end of period (in 000's) $ 1,584 $1,000
------- ------
------- ------
Ratio of expenses to average net assets:
With waiver and reimbursement (15) 1.25% 0.00%(8)
------- ------
------- ------
Without waiver and reimbursement (15) 14.59% --
------- ------
------- ------
Ratio of net investment income to average net assets:
With waiver and reimbursement (15) (0.27)% 0.00%(8)
------- ------
------- ------
Without waiver and reimbursement (15) (13.61)% --
------- ------
------- ------
Portfolio turnover 149.96% 0.00%
------- ------
------- ------
</TABLE>
- ------------------------------------
For Footnote References, see "Notes to Financial Highlights."
Page 104
<PAGE>
Dresdner RCM Global Funds
Financial Highlights
For a share outstanding throughout each fiscal year or period ended:
<TABLE>
<CAPTION>
STRATEGIC INCOME
FUND
--------------------
CLASS I
--------------------
DECEMBER 31,
--------------------
1999 1998(5)
------- --------
<S> <C> <C>
PER SHARE OPERATING PERFORMANCE: (1)
Net asset value, beginning of period $ 10.00 $10.00
------- ------
Income from investment operations:
Net investment income 0.53 --
Net realized and unrealized loss on investments (0.27) --
------- ------
Total from investment operations 0.26 --
Less distributions:
From net investment income (0.53) --
In excess of net investment income (0.18) --
------- ------
Total distributions (0.71) --
------- ------
NET ASSET VALUE, END OF PERIOD $ 9.55 $10.00
------- ------
------- ------
TOTAL RETURN (7) 2.67% 0.00%
------- ------
------- ------
RATIOS AND SUPPLEMENTAL DATA:
Net assets, end of period (in 000's) $ 2,866 $3,000
------- ------
------- ------
Ratio of expenses to average net assets:
With waiver and reimbursement (15) 1.25% 0.00%(8)
------- ------
------- ------
Without waiver and reimbursement (15) 5.31% --
------- ------
------- ------
Ratio of net investment income to average net assets:
With waiver and reimbursement (15) 5.38% 0.00%(8)
------- ------
------- ------
Without waiver and reimbursement (15) 1.32% --
------- ------
------- ------
Portfolio turnover 346.34% 0.00%
------- ------
------- ------
</TABLE>
- ------------------------------------
For Footnote References, see "Notes to Financial Highlights."
<TABLE>
<CAPTION>
BALANCED FUND
-------------
CLASS I
-------------
DECEMBER 31,
-------------
1999(14)
-------------
<S> <C>
PER SHARE OPERATING PERFORMANCE: (1)
Net asset value, beginning of period $ 10.00
-------
Income from investment operations:
Net investment income 0.01
Net realized and unrealized gain on investments 0.64
-------
Total from investment operations 0.65
-------
NET ASSET VALUE, END OF PERIOD $ 10.65
-------
-------
TOTAL RETURN (7) 6.50%
-------
-------
RATIOS AND SUPPLEMENTAL DATA:
Net assets, end of period (in 000's) $ 1,009
-------
-------
Ratio of expenses to average net assets:
With waiver and reimbursement (15) 0.90%
-------
-------
Without waiver and reimbursement (15) 41.29%
-------
-------
Ratio of net investment income to average net assets:
With waiver and reimbursement (15) 1.41%
-------
-------
Without waiver and reimbursement (15) (38.97)%
-------
-------
Portfolio turnover 59.94%
-------
-------
</TABLE>
- ------------------------------------
For Footnote References, see "Notes to Financial Highlights."
Page 105
<PAGE>
Dresdner RCM Global Funds
Notes to Financial Highlights
For the Fiscal Year or Period Ended December 31, 1999
The following notes are being used as reference items in the Financial
Highlights of the Funds.
(1) Calculated using the average share method.
(2) Commencement of operations was December 27, 1995.
(3) Commencement of operations was December 31, 1996.
(4) Commencement of operations was December 30, 1997.
(5) Commencement of operations was December 31, 1998.
(6) Stock split 10:1 at close of business on June 17, 1996. All prior period
per share amounts were restated to reflect the stock split.
(7) Total return measures the change in value of an investment over the period
indicated. For periods less than one year, the total return is not
annualized.
(8) Not annualized. Fund was in operation for less than five days.
(9) Commencement of operations was March 2, 1999.
(10) Commencement of operations was February 12, 1999.
(11) Commencement of operations was March 9, 1999.
(12) Commencement of operations was January 20, 1999.
(13) The operating expenses for the Dresdner RCM Europe Fund include certain
non-recurring legal expenses of 0.46% and 0.32% of average net assets for
the years ended December 31, 1998 and 1999, respectively, for which the
insurance carrier has agreed to reimburse the Fund 0.78 % ($800,000) of
average net assets for the year ended December 31, 1999.
(14) Commencement of operations was December 15, 1999.
(15) Annualized for periods of less than one year.
Page 106
<PAGE>
Dresdner RCM Global Funds
Notes to Financial Statements
December 31, 1999
1. SIGNIFICANT ACCOUNTING POLICIES
The Dresdner RCM Global Funds, Inc. (the "Global Company"), the Dresdner
RCM Capital Funds, Inc. (the "Capital Company") and the Dresdner RCM Investment
Funds Inc. (the "Investment Company") are organized as Maryland corporations and
are registered as open-end management investment companies under the Investment
Company Act of 1940 (the "1940 Act"), as amended. These three corporations are
each referred to as a "Company" and collectively as the "Companies."
The Global Company consists of ten no-load series:
NON-DIVERSIFIED FUNDS
Dresdner RCM Global Technology Fund (the "Global Technology Fund")
Dresdner RCM Global Health Care Fund (the "Global Health Care Fund")
Dresdner RCM Biotechnology Fund (the "Biotechnology Fund")
DIVERSIFIED FUNDS
Dresdner RCM Global Small Cap Fund (the "Global Small Cap Fund")
Dresdner RCM Large Cap Growth Fund (the "Large Cap Growth Fund")
Dresdner RCM Emerging Markets Fund (the "Emerging Markets Fund")
Dresdner RCM Tax Managed Growth Fund (the "Tax Managed Growth Fund")
Dresdner RCM Global Equity Fund (the "Global Equity Fund")
Dresdner RCM Strategic Income Fund (the "Strategic Income Fund")
Dresdner RCM Balanced Fund (the "Balanced Fund")
The Dresdner RCM International Growth Equity Fund (the "International
Fund"), is a non-diversified, no-load series of the Capital Company (financial
information of the other series of the Capital Company are reported in the
Dresdner RCM Capital Funds' annual report). The Dresdner RCM Europe Fund (the
"Europe Fund"), formerly The Emerging Germany Fund, Inc., is a non-diversified,
no load series of the Investment Company. These twelve series are collectively
referred to as the "Funds."
The Europe Fund was incorporated in the State of Maryland on
February 2, 1990 as a non-diversified, closed-end management investment company
and registered under the 1940 Act. On January 26, 1999, the stockholders of the
Fund approved the conversion of the Fund from a closed-end investment company to
an open-end investment company. Upon conversion of the Fund on May 3, 1999, two
classes of shares were offered: Class N and Class I. Existing shareholders of
the Fund received Class N shares of the converted open-end Fund, equal in number
to their previous closed-end Fund shares.
The Balanced Fund had no operations prior to December 15, 1999 other
than matters relating to its organization and registration as a diversified
open-ended management investment company under the 1940 Act and registration of
its shares under the Securities Act of 1933, as amended.
The Funds, with the exception of the Global Health Care Fund, the
Biotechnology Fund and the Balanced Fund, are presently authorized to issue two
classes of shares -- Institutional shares (Class I) and Non-institutional shares
(Class N). The Global Health Care Fund and the Biotechnology Fund are presently
authorized to issue Class N shares, and the Balanced Fund is authorized to issue
Class I shares. As of December 31, 1999, the Large Cap Growth Fund, Tax
Page 107
<PAGE>
Dresdner RCM Global Funds
Notes to Financial Statements
December 31, 1999
1. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Managed Growth Fund, Global Small Cap Fund, Global Technology Fund,
International Fund, and Emerging Markets Fund have both Class I and Class N
shares operational; the Global Equity Fund and Strategic Income Fund have only
the Class I shares operational; and the Europe Fund has only the Class N shares
operational.
The following is a summary of significant accounting policies
consistently followed by the Funds in the preparation of their financial
statements. The policies are in conformity with generally accepted accounting
principles which require management to make estimates and assumptions that
affect the reported amounts and disclosures in the financial statements. Actual
results may differ from those estimates.
A. PORTFOLIO VALUATIONS:
Investment securities are stated at market value. Equity securities
traded on stock exchanges are valued at the last sale price on the exchange or
in the principal over-the-counter market in which such securities are traded as
of the close of business on the day the securities are being valued. If there
has been no sale on such day, then the security will be valued at the closing
bid price on such day. If no bid price is quoted on such day, then the security
will be valued by such method as the Board of Directors of the appropriate
Company or a duly constituted committee of the Board of Directors of the
appropriate Company shall determine in good faith will reflect its fair value.
Readily marketable securities traded only in the over-the-counter market that
are not listed on NASDAQ or similar foreign reporting service will be valued at
the mean bid price, or using such other comparable sources as the Board of
Directors of the appropriate Company or a duly constituted committee of the
Board of Directors of the appropriate company in good faith deems appropriate to
reflect their fair value. Other portfolio securities held by the Funds will be
valued at current market value, if current market quotations are readily
available for such securities. To the extent that market quotations are not
readily available, such securities will be valued by whatever means the Board of
Directors of the appropriate Company or a duly constituted committee of the
Board of Directors of the appropriate Company in good faith deems appropriate to
reflect their fair market value. Short-term investments with a maturity of
60 days or less are valued at amortized cost, which approximates market value.
B. SECURITY TRANSACTIONS, RELATED INVESTMENT INCOME AND EXPENSES:
Security transactions are recorded as of the date of purchase or sale.
Dividend income is recorded on the ex-dividend date and interest income is
recorded on the accrual basis and includes accretion of discount and
amortization of premium. Realized gains and losses on security transactions are
determined on the identified cost basis for both financial statement and federal
income tax purposes. Each Fund bears expenses incurred specifically on its
behalf as well as a portion of any general expenses of the appropriate Company.
Investment income, realized and unrealized gains and losses, and the common
expenses of the Funds are allocated on a pro rata basis to each class based on
the relative net assets of each class to the total net assets of the Funds. Each
class of shares differs in its respective distribution and certain other class
specific fees and expense reductions.
C. FOREIGN CURRENCY TRANSLATIONS AND FOREIGN INVESTMENTS:
The books and records of each of the Funds are maintained in U.S.
dollars. The value of securities, currencies, and other assets and liabilities
denominated in currencies other than U.S. dollars are translated into U.S.
dollars based
Page 108
<PAGE>
Dresdner RCM Global Funds
Notes to Financial Statements
December 31, 1999
1. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
upon foreign exchange rates prevailing at the end of the period. Purchases and
sales of investments are translated at the contracted currency exchange rates
established at the time of the trade. Income and expenses are translated at the
prevailing exchange rates on the respective dates of such transactions.
Net realized currency gains and losses include foreign currency gains
and losses between trade date and settlement date and foreign currency
translations and the difference between the amount of net investment income
accrued and the U.S. dollar amount actually received. The Funds do not isolate
that portion of foreign currency exchange fluctuation on investments from
unrealized appreciation and depreciation which arises from changes in market
prices. Such fluctuations are included with the net unrealized appreciation or
depreciation on investments.
Investing in securities of foreign companies and foreign governments
involves special risks and considerations not typically associated with
investing in U.S. companies and securities of the U.S. Government. These risks
include revaluation of currencies and the risk of appropriation. Moreover, the
markets for securities of many foreign companies and foreign governments may be
less liquid and the prices of such securities may be more volatile than those of
comparable U.S. companies and the U.S. Government.
D. FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS:
A forward foreign currency exchange contract ("forward contract") is an
agreement between two parties to buy and sell a currency at a set price on a
future date. A Fund may enter into a forward contract in order to hedge foreign
currency risk associated with its portfolio securities or for other risk
management or investment purposes. The market value of the forward contract
fluctuates with changes in currency exchange rates. The forward contract is
marked-to-market daily and the change in market value is recorded by the Fund as
unrealized appreciation or depreciation on foreign currency translations on the
Fund's Statement of Assets and Liabilities. When the forward contract is closed,
the Fund records a realized gain or loss on foreign currency transactions in the
Fund's Statement of Operations equal to the difference between the value at the
time the forward contract was opened and the value at the time it was closed. A
Fund could be exposed to risk of loss if the counterparty is unable to meet the
terms of the forward contract or if the value of the currency changes
unfavorably.
E. OPTION ACCOUNTING PRINCIPLES:
A Fund may purchase or write put and call options on stocks and stock
indices as a hedge against changes in market conditions that may result in
changes in the value of the Fund's portfolio securities. When a Fund writes a
call or put option, an amount equal to the premium received is included in the
Fund's Statement of Assets and Liabilities as an asset and an equivalent
liability. The amount of the liability is subsequently marked-to-market to
reflect the current market value of the option. An option listed on a traded
exchange is valued at its last sale price. If there has been no sale on such
day, then the option will be valued at the closing bid price on such day. If a
written option expires on its stipulated expiration date or if the Fund enters
into a closing purchase transaction, a gain or loss is realized without regard
to any unrealized gain or loss on the underlying security, and the liability
related to such option is extinguished. If a written call option is exercised, a
gain or loss is realized from the sale of the underlying security and the
proceeds of the sale are increased by the premium originally received. If a
written put option is exercised, the cost of the underlying security purchased
is decreased by the premium originally received.
Page 109
<PAGE>
Dresdner RCM Global Funds
Notes to Financial Statements
December 31, 1999
1. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
The premium paid by a Fund for the purchase of a call or put option is
included in the Fund's Statement of Assets and Liabilities as an investment and
subsequently marked-to-market to reflect the current market value of the option.
If an option which the Fund has purchased expires on the stipulated expiration
date, the Fund realizes a loss in the amount of the cost of the option. If the
Fund enters into a closing sale transaction, the Fund realizes a gain or loss,
depending on whether proceeds from the closing sale transaction are greater or
less than the cost of the option. If the Fund exercises a call option, the cost
of the securities acquired by exercising the call is increased by the premium
paid to buy the call. If the Fund exercises a put option, it realizes a gain or
loss from the sale of the underlying security, and the proceeds from such sale
are decreased by the premium originally paid.
F. FEDERAL INCOME TAXES:
Each Fund is a separate entity for federal income tax purposes. Each
Fund intends to comply with the requirements for qualification as a "regulated
investment company" under the Internal Revenue Code of 1986, as amended (the
"Code"). It is also the intention of each Fund to make distributions sufficient
to avoid imposition of any excise tax under Section 4982 of the Code. Therefore,
no provision has been made for Federal income or excise taxes on income and
capital gains. As of December 31, 1999, the Strategic Income Fund had a capital
loss carryover of $53,023 which will expire on December 31, 2007.
G. DISTRIBUTIONS:
The Strategic Income Fund declares and distributes income dividends to
shareholders monthly. The Balanced Fund declares and distributes income
dividends to shareholders quarterly. All of the other Funds declare and
distribute income dividends to shareholders annually. Capital gain distributions
(if any) are declared and distributed to shareholders annually. Distributions to
shareholders are recorded by the Funds on the ex-dividend date. Income dividends
and capital gain distributions are determined in accordance with Federal income
tax regulations, which may differ from generally accepted accounting principles,
and only distributions in excess of tax basis earnings and profits are reported
in the financial statements as a return of capital. Differences in the
recognition or classification of income between the financial statements and tax
earnings and profits which result in temporary over-distributions for financial
statement purposes are classified as distributions in excess of net investment
income or net realized gain on investments. These differences are primarily due
to differing treatments for losses as a result of wash sales, foreign currency
transactions and/or investments in passive foreign investment companies.
H. SECURITIES LENDING:
The Europe Fund has a Securities Lending Agreement with State Street
Global Advisors ("SSgA"). For international securities, cash collateral is
received by the Fund against loaned securities in an amount at least equal to
105% of the market value of the loaned securities at the inception of each loan.
This collateral must be maintained at not less than 104.5% of the market value
of the loaned securities during the period of the loan. The Fund invests the
cash collateral in repurchase agreements through State Street Bank & Trust
Company pursuant to guidelines approved by the Europe Fund's Board of Directors.
Income earned on the collateral is paid to SSgA monthly. The Fund receives a
fee, payable monthly, negotiated by the Fund and SSgA, based on the number and
duration of the lending transactions.
Page 110
<PAGE>
Dresdner RCM Global Funds
Notes to Financial Statements
December 31, 1999
1. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
At December 31, 1999, the Europe Fund had no securities on loan to
brokers. For the period May 1, 1999 (commencement of securities lending) through
December 31, 1999, net securities lending income was $6,615 and is included in
interest income. As with other extensions of credit, the Fund may bear the risk
of delay in the recovery of the loaned securities or in the foreclosure on
collateral.
I. REDEMPTION FEES:
The Tax Managed Growth Fund charges a 1.00% redemption fee to
shareholders of both the I Class and the N Class who redeem shares held for less
than twelve consecutive months. The redemption fee for the Tax Managed Growth
Fund will remain in effect indefinitely. For the year ended December 31, 1999,
there were no redemption fees for the Fund.
For the period of May 1, 1999 through October 31, 1999, the Europe Fund
charged a 1.00% redemption fee to shareholders who redeemed shares held for less
than twelve consecutive months. The redemption fee is no longer in effect as of
November 1, 1999. For the period from May 1, 1999 to October 31, 1999, the
redemption fees for the Fund amounted to $540,588, which is included in the
Statement of Changes in Net Assets.
2. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Dresdner RCM Global Investors LLC ("Dresdner RCM") serves as the Funds'
investment manager, subject to the authority of the Boards of Directors. The
Funds pay the management fees shown below to Dresdner RCM monthly. The fees are
based on each Fund's average daily net assets as listed in the following table.
Dresdner RCM has voluntarily agreed, until at least December 31, 1999,
to pay each Fund (except the Europe Fund) the amount, if any, by which ordinary
operating expenses of the Fund for each quarter (except interest, taxes, and
extraordinary expenses) exceed its annualized total expense ratio noted below as
a percentage of its average daily net assets. In subsequent years, each Fund
will reimburse Dresdner RCM for any such payments during a five-year period to
the extent that operating expenses are otherwise below the expense cap.
Upon conversion of the Europe Fund on May 3, 1999, Dresdner RCM
voluntarily agreed, until at least December 31, 2002, to waive a portion of its
fee and to pay the Europe Fund on a quarterly basis the amount, if any, by which
the ordinary operating expenses of the Fund (except taxes, interest, and
extraordinary expenses) exceed an annual expense ratio of 1.60% (Class N) and
1.35% (Class I). In subsequent years, the Europe Fund will reimburse Dresdner
RCM, for such payments for a period of up to five years after they are made, to
the extent that the Fund's ordinary operating expenses are less than the expense
limit. Prior to conversion, the Europe Fund paid Dresdner RCM investment
management and administrative fees monthly, at an annual rate of 1.00% of the
average daily net assets up to $100 million and at an annual rate of 0.80% of
such assets in excess of $100 million.
Page 111
<PAGE>
Dresdner RCM Global Funds
Notes to Financial Statements
December 31, 1999
2. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES (CONTINUED)
For the respective periods ended December 31, 1999, Dresdner RCM
reimbursed the Funds' for the following operating expenses.
MANAGEMENT FEES, EXPENSE CAPS AND EXPENSE REIMBURSEMENTS
FISCAL PERIOD ENDED DECEMBER 31, 1999
<TABLE>
<CAPTION>
ANNUAL MANAGEMENT FEE PERCENTAGES EXPENSES
------------------------------------------ ----------------------
FIRST $500 NEXT $500 ABOVE $1 EXPENSE
FUND FLAT RATE MILLION MILLION BILLION CAPS REIMBURSEMENT
- ------------------------- --------- ---------- --------- -------- ------- -------------
<S> <C> <C> <C> <C> <C> <C>
Large Cap Growth Fund--I -- 0.70% 0.65% 0.60% 0.95% $183,104
Large Cap Growth Fund--N -- 0.70% 0.65% 0.60% 1.20% 35,363
Biotechnology Fund--N -- 1.00% 0.95% 0.90% 1.50% 175,130
Tax Managed Fund--I -- 0.75% 0.70% 0.65% 1.25% 153,642
Tax Managed Fund--N -- 0.75% 0.70% 0.65% 1.50% 56,697
Global Small Cap Fund--I -- 1.00% 0.95% 0.90% 1.50% 182,326
Global Small Cap Fund--N -- 1.00% 0.95% 0.90% 1.75% 32,415
Global Technology Fund--I 1.00% -- -- -- 1.50% --
Global Technology Fund--N 1.00% -- -- -- 1.75% 33,268
Global Health Care
Fund--N -- 1.00% 0.95% 0.90% 1.50% 183,721
International Fund--I 0.75% -- -- -- 1.00% 93,310
International Fund--N 0.75% -- -- -- 1.25% 39,047
Emerging Markets Fund--I 1.00% -- -- -- 1.50% 267,703
Emerging Markets Fund--N 1.00% -- -- -- 1.75% 42,518
Europe Fund--I 1.00% * -- -- -- 1.35% --
Europe Fund--N 1.00% * -- -- -- 1.60% 199,096
Global Equity Fund--I -- 0.75% 0.70% 0.65% 1.25% 150,248
Global Equity Fund--N -- 0.75% 0.70% 0.65% 1.50% --
Strategic Income Fund--I -- 0.75% 0.70% 0.65% 1.25% 119,666
Strategic Income Fund--N -- 0.75% 0.70% 0.65% 1.50% --
Balanced Fund--I -- 0.65% 0.60% 0.55% 0.90% 17,306
</TABLE>
* The Europe Fund pays management fees at 1.00% annually for assets under
$100 million and 0.80% for assets above $100 million.
For the year ended December 31, 1999, the Global Technology Fund,
Class I, reimbursed Dresdner RCM $830 under the above Reimbursement Agreement.
At December 31, 1999, the Global Technology Fund, Class I, has a remaining
contingent liability of $305,344. Of this contingent liability, $184,721,
$43,147 and $77,476 expires on December 31, 2001, December 31, 2002 and
December 31, 2003, respectively.
On December 31, 1999, the Dresdner RCM Profit Sharing Plan,
participation in which is limited to employees of Dresdner RCM, owned 342,120
shares and 458,053 shares of the total 4,734,785 and 12,860,719 outstanding
shares of the Global Technology Fund and the International Fund, respectively.
Page 112
<PAGE>
Dresdner RCM Global Funds
Notes to Financial Statements
December 31, 1999
2. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES (CONTINUED)
As of December 31, 1999, certain Dresdner RCM employees individually
owned the following shares of the Funds:
<TABLE>
<CAPTION>
FUND SHARES OWNED
- -------------------------------------------------- ------------
<S> <C>
Large Cap Growth Fund 283
Global Small Cap Fund 181
Global Technology Fund 485,927
Global Health Care Fund 210
</TABLE>
As of December 31, 1999, clients of Dresdner Bank AG/Investment
Management/Institutional Asset Management Division owned the following shares of
the Funds:
<TABLE>
<CAPTION>
FUND SHARES OWNED OUTSTANDING SHARES
- ---------------------------------------- ------------ ------------------
<S> <C> <C>
Biotechnology Fund 300,000 742,818
Tax Managed Growth Fund 100,000 150,798
Global Small Cap Fund 400,000 1,090,950
Global Health Care Fund 400,000 441,001
Emerging Markets Fund 300,000 323,000
Global Equity Fund 100,000 100,000
Strategic Income Fund 300,000 300,000
</TABLE>
At December 31, 1999, the following Funds had shareholders which each
held more than 5% of the Fund's Net Assets:
<TABLE>
<CAPTION>
PERCENTAGE OF
NUMBER OF AGGREGATE
FUND SHAREHOLDERS OWNERSHIP
- ---------------------------------------- ------------ -------------
<S> <C> <C>
Large Cap Growth Fund 3 88.40%
Biotechnology Fund 3 95.35%
Tax Managed Growth Fund 2 81.67%
Global Small Cap Fund 3 90.62%
Global Technology Fund 5 71.43%
Global Health Care Fund 1 90.70%
International Fund 5 57.56%
Emerging Markets Fund 1 93.07%
Europe Fund 5 45.16%
Global Equity Fund 1 100.00%
Strategic Income Fund 1 100.00%
Balanced Fund 1 100.00%
</TABLE>
Page 113
<PAGE>
Dresdner RCM Global Funds
Notes to Financial Statements
December 31, 1999
3. DISTRIBUTOR
Funds Distributor, Inc. (the "Distributor") acts as distributor of
shares of the Funds.
Both the Global Company and the Capital Company have a distribution and
service plan (the "Plan") pursuant to Rule 12b-1 under the 1940 Act. Under the
Plan, each Fund pays the Distributor an annual fee of up to 0.25% of the average
daily net assets of its Class N shares as reimbursement for certain expenses
incurred by the Distributor in providing distribution and shareholder support
services to such shares. Class I shares are not subject to 12b-1 fees. Effective
May 3, 1999, the Investment Funds adopted a distribution plan pursuant to
Rule 12b-1 under the 1940 Act, whereby the Fund pays the Distributor on a
monthly basis for all costs incurred by it in distributing Class N shares at an
annual rate not to exceed 0.25% of the Fund's Class N shares' average daily net
assets.
4. CAPITAL SHARES
At December 31, 1999, the Global Company and Capital Company each has
1,000,000,000 authorized shares of common stock at $0.0001 par value, and the
Investment Company has 1,000,000,000 authorized shares of $0.001 par value
common stock, designated as follows:
<TABLE>
<CAPTION>
CLASS I CLASS N
----------- -----------
<S> <C> <C>
Large Cap Growth Fund 50,000,000 25,000,000
Biotechnology Fund -- 50,000,000
Tax Managed Growth Fund 25,000,000 25,000,000
Global Small Cap Fund 50,000,000 25,000,000
Global Technology Fund 50,000,000 25,000,000
Global Health Care Fund -- 50,000,000
International Fund 100,000,000 50,000,000
Emerging Markets Fund 50,000,000 25,000,000
Europe Fund 100,000,000 100,000,000
Global Equity Fund 25,000,000 25,000,000
Strategic Income Fund 25,000,000 25,000,000
Balanced Fund 25,000,000 --
</TABLE>
5. DEFERRED ORGANIZATION COSTS
Costs incurred by the Funds in connection with their organization are
being amortized on a straight-line basis over a five-year period beginning at
the commencement of each Fund's operations. The Tax Managed Growth Fund,
International Fund, Europe Fund, Global Equity Fund, Strategic Income Fund, and
Balanced Fund did not have any organization costs.
Page 114
<PAGE>
Dresdner RCM Global Funds
Notes to Financial Statements
December 31, 1999
6. WRITTEN OPTIONS AND FORWARD FOREIGN CURRENCY CONTRACTS
Transactions in written put and call options for the year ended December
31, 1999 for the Global Technology Fund were as follows:
<TABLE>
<CAPTION>
AMOUNT OF NUMBER OF
PREMIUMS CONTRACTS
----------- ---------
<S> <C> <C>
Options outstanding at December 31, 1998 $ -- --
Options sold 3,398,087 600
Options cancelled in closing purchase
transactions (3,398,087) (600)
Options expired prior to exercise -- --
Options exercised -- --
----------- -------
Options outstanding at December 31, 1999 $ -- --
=========== =======
</TABLE>
No written options were outstanding at December 31, 1999.
Forward foreign currency contracts outstanding at December 31, 1999 are
as follows:
<TABLE>
<CAPTION>
IN
CONTRACTS EXCHANGE SETTLEMENT NET UNREALIZED
FUND SALES TO DELIVER FOR DATE VALUE APPRECIATION
- ------------------------- ------ ---------- -------- ---------- -------- --------------
<S> <C> <C> <C> <C> <C> <C>
Strategic Income Fund Euro 135,000 $143,876 3/28/00 $136,876 $7,000
======== ======== ======
International Fund GBP 33,321 $53,826 1/04/00 $ 53,803 $ 23
GBP 33,473 54,170 1/05/00 54,049 121
-------- -------- ------
$107,996 $107,852 $ 144
======== ======== ======
</TABLE>
7. DIRECTORS' FEES
Each Director who is not an interested person of the Global Company (as
defined in the 1940 Act) receives from the Global Company an annual retainer of
$1,000 (the retainer is evenly prorated among each series of the Global
Company), plus $500 for each Board meeting attended for each series, and $250
for each committee meeting attended for each series.
Each Director who is not an interested person of the Capital Company
(International Fund) (as defined in the 1940 Act) receives from the Capital
Company an annual retainer of $9,000, plus $1,500 for each Board meeting
attended for each series, and $500 for each committee meeting attended for each
series.
Each Director who is not an interested person of the Investment Company
(Europe Fund) (as defined in the 1940 Act) receives from the Investment Company
an annual retainer of $9,000, plus $1,500 for each Board meeting attended for
the series. The Europe Fund also pays each member of the strategic planning and
communications subcommittees $1,500 for each meeting attended.
Page 115
<PAGE>
Dresdner RCM Global Funds
Notes to Financial Statements
December 31, 1999
7. DIRECTORS' FEES (CONTINUED)
Each Director of a Company who is not an interested person of the Global
Company and the Capital Company may elect to defer receipt of all or a portion
of his or her fees for service as a director in accordance with the terms of a
Deferred Compensation Plan for Non-Interested Directors ("Directors' Plan").
Under the Directors' Plan, an eligible Director may elect to have his/her
deferred fees deemed invested either in 90-day U.S. Treasury bills, or shares of
the common stock of the Capital Company, the Global Company, or a combination of
these options. The amount of deferred fees payable to such Director under the
Directors' Plan will be determined by reference to the return on such deemed
investments. Generally, the deferred fees (reflecting any earnings, gains or
losses thereon) become payable upon the Director's retirement or disability.
8. LINE OF CREDIT
The Europe Fund has an uncommitted Line of Credit arrangement ("LOC")
with State Street Bank and Trust Company, primarily to temporarily finance the
repurchase of capital shares. The Fund's borrowings cannot exceed 33 1/3% of the
Fund's net assets and cannot exceed the $60 million limit on the LOC. Interest
is charged to the Fund based on its borrowings at the prevailing market rates as
defined in the LOC. The average daily loan balance was $199,314 at a weighted
average interest rate of 5.49%. The maximum loan outstanding during the period
ended December 31, 1999 was $11,148,000. Interest expense of $11,093 was
recorded during the year and has been included in miscellaneous expense on the
statement of operations. At December 31, 1999, there were no such borrowings
outstanding.
Page 116
<PAGE>
Report of Independent Accountants
TO THE BOARD OF DIRECTORS AND SHAREHOLDERS OF THE DRESDNER RCM GLOBAL FUNDS,
INC., THE DRESDNER RCM INVESTMENT FUNDS, INC. AND THE BOARD OF DIRECTORS OF THE
DRESDNER RCM CAPITAL FUNDS, INC. AND THE SHAREHOLDERS OF THE DRESDNER RCM
INTERNATIONAL GROWTH EQUITY FUND:
In our opinion, the accompanying statements of assets and liabilities,
including the portfolios of investments, and the related statements of
operations and of changes in net assets and the financial highlights present
fairly, in all material respects, the financial position of the Dresdner RCM
Global Funds, Inc. (consisting of the Dresdner RCM Global Technology Fund,
Dresdner RCM Global Small Cap Fund, Dresdner RCM Health Care Fund, Dresdner RCM
Large Cap Growth Fund, Dresdner RCM Biotechnology Fund, Dresdner RCM Emerging
Markets Fund, Dresdner RCM Tax Managed Growth Fund, Dresdner RCM Global Equity
Fund, Dresdner RCM Strategic Income Fund and the Dresdner RCM Balanced Fund),
the Dresdner RCM Capital Funds, Inc. (consisting of the Dresdner RCM
International Growth Equity Fund) and the Dresdner RCM Investment Funds, Inc.
(consisting of the Dresdner RCM Europe Fund, formerly the Emerging Germany Fund,
Inc.), hereafter referred to as the "Funds" at December 31, 1999, the results of
their operations, the changes in their net assets and the financial highlights
for each of the periods indicated, in conformity with accounting principles
generally accepted in the United States. These financial statements and
financial highlights (hereafter referred to as "financial statements") are the
responsibility of the Funds' management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with auditing standards
generally accepted in the United States which require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. 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, and evaluating the overall financial statement presentation. We
believe that our audits, which included confirmation of securities at December
31, 1999 by correspondence with the custodian and brokers, provide a reasonable
basis for the opinion expressed above.
PricewaterhouseCoopers LLP
Boston, Massachusetts
February 18, 2000
Page 117
<PAGE>
TAX INFORMATION (UNAUDITED)
On December 20, 1999 distributions were paid from investment operations
for the Funds except the Europe Fund. The dividends were recorded on
December 16, 1999, to shareholders of record on December 15, 1999. On
January 14, 2000, distributions were paid from investment operations for the
Europe Fund. The dividend was recorded on December 30, 1999 to shareholders of
record on December 29, 1999.
<TABLE>
<CAPTION>
ORDINARY LONG-TERM TOTAL
FUND INCOME CAPITAL GAIN DISTRIBUTIONS
- ----------------------------------- ---------- ------------ -------------
<S> <C> <C> <C>
Large Cap Growth Fund--Class I
Per Share $ 1.52 $ 2.45 $ 3.97
Amount $ 965,548 $ 1,550,904 $ 2,516,452
Large Cap Growth Fund--Class N
Per Share $ 1.52 $ 2.45 $ 3.97
Amount $ 17,754 $ 28,518 $ 46,272
Biotechnology Fund--Class N
Per Share $ 3.25 $ 0.05 $ 3.30
Amount $1,844,357 $ 31,109 $ 1,875,466
Tax Managed Growth Fund--Class I
Per Share $ 0.23 $ 0.00 $ 0.23
Amount $ 23,023 $ 0 $ 23,023
Tax Managed Growth Fund--Class N
Per Share $ 0.23 $ 0.00 $ 0.23
Amount $ 5,987 $ 0 $ 5,987
Global Small Cap Fund--Class I
Per Share $ 1.51 $ 0.27 $ 1.78
Amount $ 736,527 $ 131,682 $ 868,209
Global Small Cap Fund--Class N
Per Share $ 1.51 $ 0.27 $ 1.78
Amount $ 72,834 $ 13,022 $ 85,856
Global Technology Fund--Class I
Per Share $ 1.21 $ 0.17 $ 1.38
Amount $3,596,365 $ 503,577 $ 4,099,942
Global Technology Fund--Class N
Per Share $ 1.21 $ 0.17 $ 1.38
Amount $1,306,678 $ 182,966 $ 1,489,644
Global Health Care Fund--Class N
Per Share $ 1.55 $ 1.04 $ 2.59
Amount $ 658,016 $ 444,876 $ 1,102,892
International Fund--Class I
Per Share $ 0.51 $ 1.06 $ 1.57
Amount $5,973,315 $12,437,317 $18,410,632
International Fund--Class N
Per Share $ 0.50 $ 1.06 $ 1.56
Amount $ 32,521 $ 69,812 $ 102,333
Emerging Markets Fund--Class I
Per Share $ 0.47 $ 0.00 $ 0.47
Amount $ 143,805 $ 0 $ 143,805
</TABLE>
Page 118
<PAGE>
TAX INFORMATION (CONTINUED)
<TABLE>
<CAPTION>
ORDINARY LONG-TERM TOTAL
FUND INCOME CAPITAL GAIN DISTRIBUTIONS
- ----------------------------------- ---------- ------------ -------------
<S> <C> <C> <C>
Emerging Markets Fund--Class N
Per Share $ 0.47 $ 0.00 $ 0.47
Amount $ 5,526 $ 0 $ 5,526
Europe Fund--Class N
Per Share $ 0.51 $ 2.17 $ 2.68
Amount $1,906,909 $ 8,143,016 $10,049,925
Global Equity Fund--Class I
Per Share $ 0.35 $ 0.00 $ 0.35
Amount $ 35,164 $ 0 $ 35,164
Strategic Income Fund--Class I
Per Share $ 0.18 $ 0.00 $ 0.18
Amount $ 55,107 $ 0 $ 55,107
Balanced Fund--Class I
Per Share $ 0.00 $ 0.00 $ 0.00
Amount $ 0 $ 0 $ 0
</TABLE>
During the taxable year ended December 31, 1999, the following Funds
paid foreign taxes and recognized foreign source income as detailed in the
following table.
<TABLE>
<CAPTION>
FOREIGN
SOURCE
FUND FOREIGN TAXES INCOME
- ---------------------------------------- ------------- ------------
<S> <C> <C>
International Fund $192,111 $1,633,685
Global Small Cap Fund $ 3,194 $ 15,619
Emerging Markets Fund $ 5,185 $ 46,202
Europe Fund $127,442 $1,034,248
</TABLE>
Page 119
<PAGE>
INVESTMENT MANAGER
Dresdner RCM Global Investors LLC
Four Embarcadero Center
San Francisco, California 94111
TRANSFER AND REDEMPTION AGENT
State Street Bank and Trust Company
225 Franklin Street
Boston, Massachusetts 02110
DISTRIBUTOR
Funds Distributor, Inc.
60 State Street, Suite 1300
Boston, Massachusetts 02109
CUSTODIAN
State Street Bank and Trust Company
225 Franklin Street
Boston, Massachusetts 02110
(Dresdner RCM Emerging Markets Fund Only)
Brown Brothers Harriman & Company
40 Water Street
Boston, Massachusetts 02109
LEGAL COUNSEL
Paul, Hastings, Janofsky & Walker LLP
555 South Flower Street
Los Angeles, California 90071
(Dresdner RCM Europe Fund Only)
Shaw Pittman
2300 N Street, N.W.
Washington, DC 20037
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP
160 Federal Street
Boston, Massachusetts 02110
Shareholders may obtain portfolio holdings by calling 1-800-726-7240.
Additional information is available on our website at www.DRCMFunds.com.
Page 120
<PAGE>
This report is not authorized for distribution to prospective investors
unless preceded or accompanied by a Dresdner RCM Global Funds prospectus, which
contains complete information about the Funds, including expenses. Investors
should read the prospectus carefully before they invest or send money, as it
explains certain risks associated with investing in these Funds, including
investments in international and emerging markets. These risks include social,
economic and political instability, market illiquidity, and currency volatility.
There are also special risks associated with investing in stocks of small
companies, which tend to be more volatile and less liquid than stocks of large
companies. There are additional risks associated with investing in Funds that
lack industry diversification. Portfolio holdings are subject to change and
should not be considered as a recommendation to purchase.
Grassroots-SM- Research is a division of Dresdner RCM Global Investors
LLC ("Dresdner RCM"). The information and opinions expressed represent the
judgement of Dresdner RCM. Dresdner RCM and its affiliates, officers, employees
or clients may effect or have effected transactions for their own account(s) in
the securities mentioned here or in any related investments. Accordingly,
information may be available to Dresdner RCM that is not reflected at this time.
The information and opinions have been compiled or arrived at from sources
believed to be reliable and in good faith, but no representation or warranty,
express or implied, is made as to their accuracy, completeness or correctness.
Dresdner RCM accepts no liability whatsoever for any direct or consequential
loss or damage arising from your use of this information. Research data used by
Grassroots-SM- to generate Grassroots-SM- Research recommendations, is received
from reporters who work as independent contractors for broker-dealers who supply
research to Dresdner RCM in connection with broker services.
DISTRIBUTOR: DRESDNER RCM DISTRIBUTORS, A DIVISION OF FUNDS DISTRIBUTOR INC.
