<PAGE>
DEAN WITTER INCOME BUILDER FUND
Two World Trade Center, New York, New York 10048
LETTER TO THE SHAREHOLDERS March 31, 1998
DEAR SHAREHOLDER:
The six-month period ended March 31, 1998, saw the equity market, as
represented by the Standard & Poor's 500 Composite Stock Price Index (S&P
500), closing at an all-time high, a rather common occurrence since the start
of the 1998 calendar year. Concerns over financial troubles in Asia, which
caused considerable volatility in the last quarter of 1997, have now almost
entirely abated, and emphasis has been placed on the strong domestic economy
and its low inflation, low interest-rate environment. The convertible market
has also been robust over the last several months, particularly the new issue
market, which has seen a record number of convertible offerings come to
market since the start of the year.
PERFORMANCE
For the six months ended March 31, 1998, Dean Witter Income Builder Fund's
Class B shares posted a total return of 8.55 percent, compared to 17.21
percent for the S&P 500 and 12.91 percent for the Lipper Equity Income Funds
Index. For the same period, the Fund's Class A, C and D shares had total
returns of 8.89 percent, 8.51 percent and 9.08 percent, respectively. The
performance of the Fund's four share classes varies because of differing
expenses.
The Fund's underperformance relative to the S&P 500 and its Lipper peer group
was due, in part, to its exposure to the convertible securities of many
small-cap companies. Small caps, as a group, lagged large caps for much of
the period under review. The Fund's tilt toward yield also served to dampen
relative performance in the strong equity market. However, this same bias
toward yield provided significant stability in the volatile environment last
fall.
PORTFOLIO STRATEGY
Since its inception on June 26, 1996, the Fund has maintained a target asset
mix of 40 percent large-capitalization common stocks, 30 percent convertible
securities, 10 percent high-yield bonds, 10 percent investment-grade
fixed-income securities and 10 percent real estate investment trusts.
<PAGE>
DEAN WITTER INCOME BUILDER FUND
LETTER TO THE SHAREHOLDERS March 31, 1998, continued
The Fund's equity component, which concentrates on large-capitalization
stocks, contributed strongly to its performance during the period. This
component has been relatively fully invested since the Fund's inception and
was well diversified on March 31, 1998 with 48 common stocks spread among 23
different industry groups.
As noted, the Fund's convertible securities component, with its concentration
on small-and mid-cap companies, caused the Fund to lag its peers, because the
large caps significantly outperformed the others. Since the
convertible-securities market is dominated by small-cap companies, we believe
that the Fund should benefit significantly once small caps resume a
leadership role.
The real estate investment trust (REIT) portion of the Fund also lagged the
broader market for most of the period under review. More recently, however,
strong fundamentals and compelling valuations have generated significant
interest in the group. Our exposure to this sector is slightly below the 10
percent target. The Fund's REIT investments are split between REIT stocks and
REIT convertible securities. In addition, two of the Fund's
real-estate-related investments have announced their intention to convert to
REIT status in the near future.
The fixed-income portion of the portfolio performed as expected, with fairly
low sensitivity to interest-rate fluctuations. This portion of the Fund is
structured to provide maximum current income with low exposure to
interest-rate movements. This strategy helped reduce volatility in the Fund
during the first half of the fiscal year.
LOOKING AHEAD
We believe that Dean Witter Income Builder Fund, which is well diversified
across various asset classes, will continue to provide one of the best ways
to seek reasonable income and, secondarily, growth of capital.
We appreciate your support of Dean Witter Income Builder Fund and look
forward to continuing to serve your investment needs in the future.
Very truly yours,
/s/ Charles A. Fiumefreddo
CHARLES A. FIUMEFREDDO
Chairman of the Board
2
<PAGE>
DEAN WITTER INCOME BUILDER FUND
PORTFOLIO OF INVESTMENTS March 31, 1998 (unaudited)
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- -------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS (44.2%)
Apparel (0.9%)
132,500 Kellwood Co. .................................................... $ 4,090,937
--------------
Auto Parts (0.8%)
69,000 Dana Corp. ...................................................... 4,014,937
--------------
Automotive (2.5%)
94,000 Chrysler Corp. ................................................. 3,906,875
66,000 Ford Motor Co. .................................................. 4,277,625
59,000 General Motors Corp. ............................................ 3,978,812
--------------
12,163,312
--------------
Banks (4.1%)
169,500 First Security Corp. ............................................ 4,036,219
122,000 First Tennessee National Corp. .................................. 3,919,250
105,000 KeyCorp ......................................................... 3,970,312
145,000 Washington Federal, Inc. ....................................... 3,987,500
62,000 Wilmington Trust Corp. ......................................... 4,115,250
--------------
20,028,531
--------------
Banks -Thrift Institutions (0.9%)
57,000 Washington Mutual, Inc. ......................................... 4,086,187
--------------
Building Materials (0.9%)
38,000 Vulcan Materials Co. ........................................... 4,161,000
--------------
Chemicals (2.6%)
44,000 Dow Chemical Co. ................................................ 4,279,000
61,000 PPG Industries, Inc. ............................................ 4,144,187
39,000 Rohm & Haas Co. ................................................ 4,029,187
--------------
12,452,374
--------------
Conglomerates (0.8%)
94,000 Tenneco, Inc. .................................................. 4,012,625
--------------
Containers -Metal & Glass (0.8%)
76,000 Crown Cork & Seal Co., Inc. .................................... 4,066,000
--------------
Finance (0.8%)
63,000 Fannie Mae ...................................................... 3,984,750
--------------
Financial (1.3%)
41,000 Providian Financial Corp. ...................................... 2,354,937
120,000 TCF Financial Corp. ............................................ 4,072,500
--------------
6,427,437
--------------
Financial -Miscellaneous (0.8%)
88,000 SLM Holding Corp. .............................................. 3,839,000
--------------
Food Processing (0.9%)
110,000 Hormel Foods Corp. .............................................. 4,269,375
--------------
SEE NOTES TO FINANCIAL STATEMENTS
3
<PAGE>
DEAN WITTER INCOME BUILDER FUND
PORTFOLIO OF INVESTMENTS March 31, 1998 (unaudited) continued
NUMBER OF
SHARES VALUE
- -------------------------------------------------------------------------------------------
Healthcare -Drugs (0.8%)
50,000 Schering-Plough Corp. .......................................... $ 4,084,375
--------------
Household Appliances (0.8%)
60,000 Whirlpool Corp. ................................................ 4,113,750
--------------
Insurance (3.0%)
17,811 Aegon N.V. (ADR)(Netherlands) ................................... 2,160,697
47,000 Jefferson-Pilot Corp. ........................................... 4,180,062
47,000 Lincoln National Corp. ......................................... 3,989,125
89,000 Torchmark Corp. ................................................. 4,077,313
--------------
14,407,197
--------------
Manufacturing -Diversified (0.9%)
69,000 Johnson Controls, Inc. ......................................... 4,187,438
--------------
Metals & Basic Materials (0.8%)
82,000 Hercules, Inc. ................................................. 4,048,750
--------------
Metals & Mining (0.8%)
239,000 Cyprus Amax Minerals Co. ........................................ 3,973,375
--------------
Miscellaneous (0.8%)
87,000 American Greetings Corp. (Class A) .............................. 4,002,000
--------------
Mobile Home & Recreation (0.8%)
87,000 Fleetwood Enterprises, Inc. ..................................... 4,050,938
--------------
Oil & Gas (0.8%)
71,000 Ashland, Inc. .................................................. 4,020,375
--------------
Real Estate Investment Trust (4.8%)
109,000 American General Hospitality Corp. ............................. 3,017,938
98,300 Boston Properties, Inc. ......................................... 3,458,931
72,100 Excel Realty Trust, Inc. ....................................... 2,568,563
59,250 Healthcare Realty Trust, Inc. ................................... 1,673,813
125,000 LTC Properties, Inc. ............................................ 2,414,063
100,000 Meditrust Corp. ................................................ 3,087,500
145,000 Reckson Associates Realty Corp. ................................ 3,824,375
208,800 Sunstone Hotel Investors, Inc. ................................. 3,340,800
--------------
23,385,983
--------------
Retail -Specialty Apparel (0.8%)
138,000 Limited (The), Inc. ............................................. 3,958,875
--------------
Steel (0.8%)
103,000 USX-U.S. Steel Group, Inc. ..................................... 3,888,250
--------------
Telecommunications (1.7%)
39,000 Bell Atlantic Corp. ............................................ 3,997,500
76,000 U.S. West Communications Group, Inc. ........................... 4,161,000
--------------
8,158,500
--------------
SEE NOTES TO FINANCIAL STATEMENTS
4
<PAGE>
DEAN WITTER INCOME BUILDER FUND
PORTFOLIO OF INVESTMENTS March 31, 1998 (unaudited) continued
NUMBER OF
SHARES VALUE
- -------------------------------------------------------------------------------------------
Telephones (0.8%)
62,000 AT&T Corp. ..................................................... $ 4,068,750
--------------
Tobacco (1.6%)
94,000 Philip Morris Companies, Inc. .................................. 3,918,625
123,000 UST, Inc. ....................................................... 3,966,750
--------------
7,885,375
--------------
Utilities -Electric (3.4%)
88,000 Consolidated Edison of New York, Inc. .......................... 4,114,000
148,000 Houston Industries Co. .......................................... 4,255,000
91,000 New England Electric System ..................................... 4,157,563
111,000 Public Service Enterprise Group, Inc. .......................... 4,204,125
--------------
16,730,688
--------------
Utilities -Gas (0.9%)
73,000 Consolidated Natural Gas Co. .................................... 4,211,188
--------------
Utilities -Telephone (0.9%)
72,000 GTE Corp. ....................................................... 4,311,000
--------------
Wholesale Distributor (0.9%)
88,000 Supervalu, Inc. ................................................ 4,103,000
--------------
TOTAL COMMON STOCKS
(Identified Cost $160,589,829) .................................. 215,186,272
--------------
CONVERTIBLE PREFERRED STOCKS (19.5%)
Apparel (0.3%)
30,500 Warnaco Group, Inc. $3.00 ....................................... 1,326,750
--------------
Auto Parts (1.4%)
94,000 BTI Capital Trust $3.25 -144A* .................................. 5,181,750
68,500 Walbro Capital Trust $2.00 ..................................... 1,532,687
--------------
6,714,437
--------------
Banks -International (1.6%)
135,000 National Australia Bank, Ltd. $1.969 (Australia) (Units)++ ...... 3,915,000
111,500 WBK Strypes Trust $3.135 ........................................ 3,797,969
--------------
7,712,969
--------------
Broadcast Media (1.6%)
109,700 Metromedia International Group, Inc. $3.625 ..................... 6,486,012
145,000 Triathlon Broadcasting Co. $0.945 ............................... 1,450,000
--------------
7,936,012
--------------
Cable & Telecommunications (1.0%)
90,000 EchoStar Communications Corp. (Series C) $3.375 ................ 5,040,000
--------------
Commercial Services (1.1%)
100,000 Cendant Corp $3.75 .............................................. 5,212,500
--------------
SEE NOTES TO FINANCIAL STATEMENTS
5
<PAGE>
DEAN WITTER INCOME BUILDER FUND
PORTFOLIO OF INVESTMENTS March 31, 1998 (unaudited) continued
NUMBER OF
SHARES VALUE
- -------------------------------------------------------------------------------------------
Computer Services (0.7%)
69,500 Unisys Corp. (Series A) $3.75 ................................... $ 3,275,188
--------------
Entertainment (0.9%)
80,000 Premier Parks, Inc. $4.05 ....................................... 4,640,000
--------------
Finance (2.2%)
112,000 Insignia Financing, Inc. $3.25 .................................. 5,579,056
90,000 Merrill Lynch & Co., Inc. (STRYPES) $2.39 (1) ................... 3,420,000
25,800 Merrill Lynch & Co., Inc. (STRYPES) $4.087 (2) .................. 1,870,500
--------------
10,869,556
--------------
Healthcare (0.8%)
141,000 Kapson Senior Quarters Corp. $2.00 -144A* ....................... 3,824,625
--------------
Machinery (0.5%)
97,000 Ingersoll-Rand Co. (PRIDES) $1.688 .............................. 2,443,188
--------------
Miscellaneous (1.6%)
81,000 Calenergy Capital Trust $3.25 .................................. 3,680,478
75,000 Union Pacific Capital Trust $3.125 -144A* ....................... 3,984,375
--------------
7,664,853
--------------
Oil & Gas (0.5%)
66,400 Sun Company, Inc. (Series A) $1.80 .............................. 2,519,050
--------------
Publishing (1.3%)
195,200 Hollinger International, Inc. $0.95 ............................. 2,793,800
130,000 Reader's Digest Association, Inc $1.93 .......................... 3,453,125
--------------
6,246,925
--------------
Real Estate Investment Trust (2.4%)
182,000 FelCor Suite Hotels, Inc. (Series A) $1.95 ..................... 5,278,000
113,000 Merry Land & Investment Co., Inc. (Series C) $2.15 ............. 3,093,375
61,400 Oasis Residential, Inc. (Series A) $2.25 ........................ 1,558,025
36,600 Rouse Co. (Series B) $3.00 ...................................... 1,765,950
--------------
11,695,350
--------------
Telecommunications (1.6%)
59,000 Loral Space & Communications, Ltd. (Series C) $3.00 (Bermuda) ... 4,443,467
44,100 Loral Space & Communications, Ltd. $3.00 -144A* (Bermuda) ...... 3,321,303
--------------
7,764,770
--------------
TOTAL CONVERTIBLE PREFERRED STOCKS
(Identified Cost $86,640,734) ................................... 94,886,173
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
6
<PAGE>
DEAN WITTER INCOME BUILDER FUND
PORTFOLIO OF INVESTMENTS March 31, 1998 (unaudited) continued
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT IN COUPON MATURITY
THOUSANDS RATE DATE VALUE
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
CORPORATE BONDS (34.2%)
CONVERTIBLE BONDS (14.4%)
Auto Parts (2.0%)
$4,000 Mark IV Industries, Inc. -144A* ................................. 4.75% 11/01/04 $3,786,240
3,000 MascoTech, Inc. ................................................ 4.50 12/15/03 2,778,750
2,700 Tower Automotive, Inc. -144A* ................................... 5.00 08/01/04 2,958,417
--------------
9,523,407
--------------
Cable/Cellular (0.7%)
9,350 U.S. Cellular Corp. ............................................ 0.00 06/15/15 3,590,306
--------------
Healthcare (1.7%)
1,500 ARV Assisted Living, Inc. ....................................... 6.75 04/01/06 1,432,500
3,000 Emeritus Corp. -144A* ........................................... 6.25 01/01/06 2,380,710
5,400 Phymatrix Corp. ................................................ 6.75 06/15/03 4,514,616
--------------
8,327,826
--------------
Healthcare -Miscellaneous (0.7%)
2,730 Pharmaceutical Marketing Services, Inc. ......................... 6.25 02/01/03 2,717,715
675 Pharmaceutical Marketing Services, Inc. (Eurobond) ............. 6.25 02/01/03 659,813
--------------
3,377,528
--------------
Hotels/Motels (0.7%)
3,800 Capstar Hotel Corp. ............................................ 4.75 10/15/04 3,561,094
--------------
Machinery (0.5%)
2,300 Thermo Fibertek, Inc. -144A* .................................... 4.50 07/15/04 2,577,449
--------------
Medical Equipment (0.7%)
3,400 ThermoTrex Corp. ................................................ 3.25 11/01/07 3,278,314
--------------
Office Equipment & Supplies (2.7%)
4,750 Danka Business Systems, PLC
(United Kingdom) ............................................... 6.75 04/01/02 4,536,250
9,880 U.S. Office Products Co. ....................................... 5.50 05/15/03 8,414,302
--------------
12,950,552
--------------
Publishing (0.4%)
1,900 Nelson (Thomas), Inc. ........................................... 5.75 11/30/99 1,894,072
--------------
Real Estate Investment Trust (0.9%)
4,425 Capstone Capital Corp. ......................................... 6.55 03/14/02 4,297,781
--------------
Restaurants (0.4%)
9,000 Boston Chicken, Inc. ........................................... 0.00 06/01/15 1,068,750
1,990 Boston Chicken, Inc. ........................................... 4.50 02/01/04 1,001,826
--------------
2,070,576
--------------
Retail (1.0%)
1,530 Petsmart, Inc. -144A* ........................................... 6.75 11/01/04 2,130,525
3,200 Saks Holdings, Inc. ............................................ 5.50 09/15/06 2,903,008
--------------
5,033,533
--------------
Semiconductors (0.8%)
4,000 National Semiconductor Corp. -144A* ............................. 6.50 10/01/02 3,876,160
--------------
SEE NOTES TO FINANCIAL STATEMENTS
7
<PAGE>
DEAN WITTER INCOME BUILDER FUND
PORTFOLIO OF INVESTMENTS March 31, 1998 (unaudited) continued
PRINCIPAL
AMOUNT IN COUPON MATURITY
THOUSANDS RATE DATE VALUE
- -----------------------------------------------------------------------------------------------------------------
Shoes (1.2%)
$2,700 Nine West Group, Inc. .......................................... 5.50 % 07/15/03 $2,162,943
4,300 Nine West Group, Inc. -144A* .................................... 5.50 07/15/03 3,444,687
--------------
5,607,630
--------------
Telecommunications (0.0%)
750 SA Telecommunications, Inc. -144A* (a) .......................... 10.00 08/15/06 112,500
--------------
TOTAL CONVERTIBLE BONDS
(Identified Cost $71,319,563) ........................................................ 70,078,728
--------------
NON-CONVERTIBLE BONDS (19.8%)
Broadcast Media (3.5%)
3,000 JCAC Inc. ....................................................... 10.125 06/15/06 3,292,500
3,805 Outlet Broadcasting, Inc. ....................................... 10.875 07/15/03 4,015,302
4,250 SCI Television, Inc. ........................................... 11.00 06/30/05 4,342,140
5,060 Young Broadcasting Corp. ........................................ 11.75 11/15/04 5,591,300
--------------
17,241,242
--------------
Building Materials (2.3%)
7,400 Johns Manville International Group, Inc. ....................... 10.875 12/15/04 8,195,500
2,850 USG Corp. (Series B) ............................................ 9.25 09/15/01 3,069,507
--------------
11,265,007
--------------
Business Services (2.2%)
9,850 Neodata Services, Inc. (Series B) ............................... 12.00 05/01/03 10,483,946
--------------
Cable/Cellular (3.4%)
12,950 Continental Cablevision, Inc. .................................. 11.00 06/01/07 14,213,402
2,000 Tele-Communications, Inc. ....................................... 9.25 04/15/02 2,195,660
--------------
16,409,062
--------------
Chemicals (1.1%)
5,000 Harris Chemical North America, Inc. ............................. 10.75 10/15/03 5,287,500
--------------
Entertainment (0.5%)
2,000 Time Warner, Inc. .............................................. 9.63 05/01/02 2,242,860
--------------
Entertainment/Gaming (0.9%)
4,200 Casino Magic Finance Corp. ..................................... 11.50 10/15/01 4,368,000
--------------
Healthcare (1.8%)
4,000 Healthsouth Rehabilition Corp. .................................. 9.50 04/01/01 4,180,000
4,400 Tenet Healthcare Corp. ......................................... 10.13 03/01/05 4,840,000
--------------
9,020,000
--------------
Industrials (1.0%)
4,500 American Standard, Inc. ........................................ 10.50 ++ 06/01/05 4,657,500
--------------
Miscellaneous (1.1%)
4,885 Huntsman Polymers Corp. ......................................... 11.75 12/01/04 5,434,563
--------------
Publishing (0.7%)
2,200 Big Flower Press, Inc. ......................................... 8.875 07/01/07 2,244,000
1,000 Hollinger International Publishing, Inc. ....................... 9.25 02/01/06 1,055,000
--------------
3,299,000
--------------
SEE NOTES TO FINANCIAL STATEMENTS
8
<PAGE>
DEAN WITTER INCOME BUILDER FUND
PORTFOLIO OF INVESTMENTS March 31, 1998 (unaudited) continued
PRINCIPAL
AMOUNT IN COUPON MATURITY
THOUSANDS RATE DATE VALUE
- -----------------------------------------------------------------------------------------------------------------
Retail (0.4%)
$1,950 Thrifty PayLess Holdings, Inc. .................................. 12.25 % 04/15/04 $2,184,000
--------------
Textiles (0.9%)
4,300 Dan River, Inc. ................................................ 10.125 12/15/03 4,563,375
--------------
TOTAL NON-CONVERTIBLE BONDS
(Identified Cost $97,224,605) ........................................................ 96,456,055
--------------
TOTAL CORPORATE BONDS
(Identified Cost $168,544,168) ....................................................... 166,534,783
--------------
SHORT-TERM INVESTMENTS (3.3%)
U.S. GOVERNMENT AGENCY (b) (3.2%)
15,500 Federal Home Loan Mortgage Corp.
(Amortized Cost $15,500,000) ................................... 5.90 04/01/98 15,500,000
--------------
REPURCHASE AGREEMENT (0.1%)
322 The Bank of New York (dated 03/31/98; proceeds $322,200)(c)
(Identified Cost $322,152) ..................................... 5.375 04/01/98 322,152
--------------
TOTAL SHORT-TERM INVESTMENTS
(Identified Cost $15,822,152) ........................................................ 15,822,152
--------------
TOTAL INVESTMENTS
(Identified Cost $431,596,883)(d) ......................................... 101.2% 492,429,380
LIABILITIES IN EXCESS OF OTHER ASSETS .................................... (1.2) (5,798,381)
--------------
NET ASSETS ................................................................ 100.0% $486,630,999
========== ==============
</TABLE>
- ------------
ADR American Depository Receipt.
STRYPES Structured yield product exchangeable for stock.
PRIDES Preferred redeemed increased dividend equity security.
* Resale is restricted to qualified institutional investors.
++ Consists of one or more class of securities traded together as a
unit; stocks with attached warrants.
++ Currently a zero coupon bond and will pay interest at the rate
shown at a future specified date.
(1) Exchangeable for IMC Global, Inc. common stock.
(2) Exchangeable for SunAmerica, Inc. common stock.
(a) Non-income producing security; bond in default.
(b) Security was purchased on a discount basis. The interest rate shown
has been adjusted to reflect a money market equivalent yield.
(c) Collateralized by $329,109 U.S. Treasury Note 5.50% due 03/31/00
valued at $328,595.
(d) The aggregate cost for federal income tax purposes approximates
identified cost. The aggregate gross unrealized appreciation is
$68,000,188 and the aggregate gross unrealized depreciation is
$7,167,691, resulting in the net unrealized appreciation of
$60,832,497.
SEE NOTES TO FINANCIAL STATEMENTS
9
<PAGE>
DEAN WITTER INCOME BUILDER FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
March 31, 1998 (unaudited)
<TABLE>
<CAPTION>
<S> <C>
ASSETS:
Investments in securities, at value (identified
cost $431,596,883)............................. $492,429,380
Receivable for:
Interest...................................... 4,196,595
Shares of beneficial interest sold............ 2,325,722
Dividends .................................... 359,013
Investments sold.............................. 345,125
Deferred organizational expenses................ 105,938
Prepaid expenses and other assets............... 116,586
--------------
TOTAL ASSETS ................................. 499,878,359
--------------
LIABILITIES:
Payable for:
Investments purchased......................... 12,215,670
Plan of distribution fee...................... 348,044
Investment management fee..................... 311,390
Shares of beneficial interest repurchased .... 197,160
Dividends and distributions to shareholders .. 101,091
Accrued expenses and other payables............. 74,005
--------------
TOTAL LIABILITIES ............................ 13,247,360
--------------
NET ASSETS.................................... $486,630,999
==============
COMPOSITION OF NET ASSETS:
Paid-in-capital................................. $414,797,279
Net unrealized appreciation..................... 60,832,497
Accumulated undistributed net investment
income......................................... 1,045,998
Accumulated undistributed net realized gain .... 9,955,225
--------------
NET ASSETS.................................... $486,630,999
==============
CLASS A SHARES:
Net Assets...................................... $8,048,809
Shares Outstanding (unlimited authorized, $.01
par value)..................................... 617,704
NET ASSET VALUE PER SHARE..................... $13.03
==============
MAXIMUM OFFERING PRICE PER SHARE,
(net asset value plus 5.54% of net asset
value)....................................... $13.75
==============
CLASS B SHARES:
Net Assets...................................... $473,831,749
Shares Outstanding (unlimited authorized, $.01
par value)..................................... 36,362,236
NET ASSET VALUE PER SHARE..................... $13.03
==============
CLASS C SHARES:
Net Assets...................................... $4,632,081
Shares Outstanding (unlimited authorized, $.01
par value)..................................... 356,062
NET ASSET VALUE PER SHARE..................... $13.01
==============
CLASS D SHARES:
Net Assets...................................... $118,360
Shares Outstanding (unlimited authorized, $.01
par value)..................................... 9,080
NET ASSET VALUE PER SHARE..................... $13.04
==============
</TABLE>
STATEMENT OF OPERATIONS
For the six months ended March 31, 1998 (unaudited)
<TABLE>
<CAPTION>
<S> <C>
NET INVESTMENT INCOME:
INCOME
Interest.................................. $ 6,510,981
Dividends................................. 4,923,788
------------
TOTAL INCOME............................ 11,434,769
------------
EXPENSES
Plan of distribution fee (Class A
shares).................................. 6,909
Plan of distribution fee (Class B
shares).................................. 1,756,024
Plan of distribution fee (Class C
shares).................................. 12,240
Investment management fee................. 1,558,599
Transfer agent fees and expenses.......... 153,280
Registration fees......................... 81,919
Professional fees......................... 33,823
Shareholder reports and notices........... 24,063
Custodian fees............................ 17,569
Organizational expenses................... 16,313
Trustees' fees and expenses............... 7,779
Other..................................... 3,628
------------
TOTAL EXPENSES.......................... 3,672,146
------------
NET INVESTMENT INCOME................... 7,762,623
------------
NET REALIZED AND UNREALIZED GAIN:
Net realized gain......................... 10,717,923
Net change in unrealized appreciation .... 17,907,883
------------
NET GAIN................................ 28,625,806
------------
NET INCREASE.............................. $36,388,429
============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
10
<PAGE>
DEAN WITTER INCOME BUILDER FUND
FINANCIAL STATEMENTS, continued
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE SIX FOR THE YEAR
MONTHS ENDED ENDED
MARCH 31, 1998 SEPTEMBER 30, 1997*
- ------------------------------------------------------ -------------- -------------------
(UNAUDITED)
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income ................................. $ 7,762,623 $ 10,365,875
Net realized gain...................................... 10,717,923 17,728,044
Net change in unrealized appreciation.................. 17,907,883 39,732,802
-------------- ----------------
NET INCREASE......................................... 36,388,429 67,826,721
-------------- ----------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income
Class A shares....................................... (142,339) (7,078)
Class B shares....................................... (7,641,707) (9,398,309)
Class C shares....................................... (56,162) (7,487)
Class D shares....................................... (1,797) (193)
Net realized gain
Class A shares....................................... (264,926) --
Class B shares....................................... (18,061,378) (157,191)
Class C shares....................................... (92,820) --
Class D shares....................................... (1,957) --
-------------- ----------------
TOTAL DIVIDENDS AND DISTRIBUTIONS.................... (26,263,086) (9,570,258)
-------------- ----------------
Net increase from transactions in shares of beneficial
interest.............................................. 115,477,577 154,629,702
-------------- ----------------
NET INCREASE......................................... 125,602,920 212,886,165
NET ASSETS:
Beginning of period.................................... 361,028,079 148,141,914
-------------- ----------------
END OF PERIOD
(Including undistributed net investment income of
$1,045,998 and $1,125,380, respectively)............. $486,630,999 $361,028,079
============== ================
</TABLE>
- ------------
* Class A, Class C, and Class D shares were issued July 28, 1997.
SEE NOTES TO FINANCIAL STATEMENTS
11
<PAGE>
DEAN WITTER INCOME BUILDER FUND
NOTES TO FINANCIAL STATEMENTS March 31, 1998 (unaudited)
1. ORGANIZATION AND ACCOUNTING POLICIES
Dean Witter Income Builder Fund (the "Fund") is registered under the
Investment Company Act of 1940, as amended (the "Act"), as a diversified,
open-end management investment company. The Fund's primary investment
objective is to seek reasonable income and, as a secondary objective, growth
of capital. The Fund seeks to achieve its objective by investing primarily in
income-producing equity securities, including common and preferred stocks as
well as convertible securities. The Fund was organized as a Massachusetts
business trust on March 21, 1996 and commenced operations on June 26, 1996.
On July 28, 1997, the Fund commenced offering three additional classes of
shares, with the then current shares designated as Class B shares.
The Fund offers Class A shares, Class B shares, Class C shares and Class D
shares. The four classes are substantially the same except that most Class A
shares are subject to a sales charge imposed at the time of purchase, some
Class A shares, and most Class B shares and Class C shares are subject to a
contingent deferred sales charge imposed on shares redeemed within one year,
six years and one year, respectively. Class D shares are not subject to a
sales charge. Additionally, Class A shares, Class B shares and Class C shares
incur distribution expenses.
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts and disclosures. Actual results could differ
from those estimates.
The following is a summary of significant accounting policies:
A. VALUATION OF INVESTMENTS-- (1) an equity security listed or traded on the
New York, American or other domestic or foreign stock exchange is valued at
its latest sale price on that exchange prior to the time when assets are
valued; if there were no sales that day, the security is valued at the latest
bid price (in cases where securities are traded on more than one exchange,
the security is valued on the exchange designated as the primary market
pursuant to procedures adopted by the Trustees); (2) all other portfolio
securities for which over-the-counter market quotations are readily available
are valued at the latest available bid price prior to the time of valuation;
(3) when market quotations are not readily available, including circumstances
under which it is determined by Dean Witter InterCapital Inc. (the
"Investment Manager") that sale or bid prices are not reflective of a
security's market value, portfolio securities are valued at their fair value
as determined in good faith under procedures established by and under the
general supervision of the Trustees (valuation of debt securities for which
market quotations are not readily available may be based upon current market
prices of securities which are comparable in coupon, rating and maturity or
an appropriate matrix utilizing similar factors); (4) certain portfolio
securities may
12
<PAGE>
DEAN WITTER INCOME BUILDER FUND
NOTES TO FINANCIAL STATEMENTS March 31, 1998 (unaudited) continued
be valued by an outside pricing service approved by the Trustees. The pricing
service may utilize a matrix system incorporating security quality, maturity
and coupon as the evaluation model parameters, and/or research and
evaluations by its staff, including review of broker-dealer market price
quotations, if available, in determining what it believes is the fair
valuation of the securities valued by such pricing service; and (5)
short-term debt securities having a maturity date of more than sixty days at
time of purchase are valued on a mark-to-market basis until sixty days prior
to maturity and thereafter at amortized cost based on their value on the 61st
day. Short-term debt securities having a maturity date of sixty days or less
at the time of purchase are valued at amortized cost.
B. ACCOUNTING FOR INVESTMENTS-- Security transactions are accounted for on
the trade date (date the order to buy or sell is executed). Realized gains
and losses on security transactions are determined by the identified cost
method. Dividend income and other distributions are recorded on the
ex-dividend date except for certain dividends on foreign securities which are
recorded as soon as the Fund is informed after the ex-dividend date.
Discounts are accreted over the life of the respective securities. Interest
income is accrued daily.
C. MULTIPLE CLASS ALLOCATIONS-- Investment income, expenses (other than
distribution fees), and realized and unrealized gains and losses are
allocated to each class of shares based upon the relative net asset value on
the date such items are recognized. Distribution fees are charged directly to
the respective class.
D. FEDERAL INCOME TAX STATUS-- It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to its shareholders.
Accordingly, no federal income tax provision is required.
E. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS-- The Fund records dividends
and distributions to its shareholders on the ex-dividend date. The amounts of
dividends and distributions from net investment income and net realized
capital gains are determined in accordance with federal income tax
regulations which may differ from generally accepted accounting principles.
These "book/tax" differences are either considered temporary or permanent in
nature. To the extent these differences are permanent in nature, such amounts
are reclassified within the capital accounts based on their federal tax-basis
treatment; temporary differences do not require reclassification. Dividends
and distributions which exceed net investment income and net realized capital
gains for financial reporting purposes but not for tax purposes are reported
as dividends in excess of net investment income or distributions in excess of
net realized capital gains. To the extent they exceed net investment income
and net realized capital gains for tax purposes, they are reported as
distributions of paid-in-capital.
13
<PAGE>
DEAN WITTER INCOME BUILDER FUND
NOTES TO FINANCIAL STATEMENTS March 31, 1998 (unaudited) continued
F. ORGANIZATIONAL EXPENSES-- The Investment Manager paid the organizational
expenses of the Fund in the amount of approximately $164,000 which have been
reimbursed for the full amount thereof. Such expenses have been deferred and
are being amortized on the straight-line method over a period not to exceed
five years from the commencement of operations.
2. INVESTMENT MANAGEMENT AGREEMENT
Pursuant to an Investment Management Agreement with Dean Witter InterCapital
Inc. (the "Investment Manager"), the Fund pays the Investment Manager a
management fee, accrued daily and payable monthly, by applying the annual
rate of 0.75% to the net assets of the Fund determined as of the close of
each business day.
Under the terms of the Agreement, in addition to managing the Fund's
investments, the Investment Manager maintains certain of the Fund's books and
records and furnishes, at its own expense, office space, facilities,
equipment, clerical, bookkeeping and certain legal services and pays the
salaries of all personnel, including officers of the Fund who are employees
of the Investment Manager. The Investment Manager also bears the cost of
telephone services, heat, light, power and other utilities provided to the
Fund.
3. PLAN OF DISTRIBUTION
Shares of the Fund are distributed by Dean Witter Distributors Inc. (the
"Distributor"), an affiliate of the Investment Manager. The Fund has adopted
a Plan of Distribution (the "Plan") pursuant to Rule 12b-1 under the Act. The
Plan provides that the Fund will pay the Distributor a fee which is accrued
daily and paid monthly at the following annual rates: (i) Class A -up to
0.25% of the average daily net assets of Class A; (ii) Class B -1.0% of the
lesser of: (a) the average daily aggregate gross sales of the Class B shares
since the inception of the Fund (not including reinvestment of dividend or
capital gain distributions) less the average daily aggregate net asset value
of the Class B shares redeemed since the Fund's inception upon which a
contingent deferred sales charge has been imposed or waived; or (b) the
average daily net assets of Class B; and (iii) Class C -up to 1.0% of the
average daily net assets of Class C. In the case of Class A shares, amounts
paid under the Plan are paid to the Distributor for services provided. In the
case of Class B and Class C shares, amounts paid under the Plan are paid to
the Distributor for services provided and the expenses borne by it and others
in the distribution of the shares of these Classes, including the payment of
commissions for sales of these Classes and incentive compensation to, and
expenses of, the account executives of Dean Witter Reynolds Inc. ("DWR"), an
affiliate of the Investment Manager and Distributor, and others who engage in
or support distribution of
14
<PAGE>
DEAN WITTER INCOME BUILDER FUND
NOTES TO FINANCIAL STATEMENTS March 31, 1998 (unaudited) continued
the shares or who service shareholder accounts, including overhead and
telephone expenses; printing and distribution of prospectuses and reports
used in connection with the offering of these shares to other than current
shareholders; and preparation, printing and distribution of sales literature
and advertising materials. In addition, the Distributor may utilize fees paid
pursuant to the Plan, in the case of Class B shares, to compensate DWR and
other selected broker-dealers for their opportunity costs in advancing such
amounts, which compensation would be in the form of a carrying charge on any
unreimbursed expenses.
In the case of Class B shares, provided that the Plan continues in effect,
any cumulative expenses incurred by the Distributor but not yet recovered may
be recovered through the payment of future distribution fees from the Fund
pursuant to the Plan and contingent deferred sales charges paid by investors
upon redemption of Class B shares. Although there is no legal obligation for
the Fund to pay expenses incurred in excess of payments made to the
Distributor under the Plan and the proceeds of contingent deferred sales
charges paid by investors upon redemption of shares, if for any reason the
Plan is terminated, the Trustees will consider at that time the manner in
which to treat such expenses. The Distributor has advised the Fund that such
excess amounts, including carrying charges, totaled $16,834,385 at March 31,
1998.
In the case of Class A shares and Class C shares, expenses incurred pursuant
to the Plan in any calendar year in excess of 0.25% or 1.0% of the average
daily net assets of Class A or Class C, respectively, will not be reimbursed
by the Fund through payments in any subsequent year, except that expenses
representing a gross sales credit to account executives may be reimbursed in
the subsequent calendar year. For the six months ended March 31, 1998, the
distribution fee was accrued for Class A shares and Class C shares at the
annual rate of 0.24% and 1.0%, respectively.
The Distributor has informed the Fund that for the six months ended March 31,
1998, it received contingent deferred sales charges from certain redemptions
of the Fund's Class B shares of $461,699 and received $66,512 in front-end
sales charges from sales of the Fund's Class A shares. The respective
shareholders pay such charges which are not an expense of the Fund.
4. SECURITY TRANSACTIONS AND TRANSACTIONS WITH AFFILIATES
The cost of purchases and proceeds from sales of portfolio securities,
excluding short-term investments, for the six months ended March 31, 1998
aggregated $217,620,801 and $125,450,891, respectively.
For the six months ended March 31, 1998, the Fund incurred $72,269 in
brokerage commissions with DWR for portfolio transactions executed on behalf
of the Fund. At March 31, 1998, Fund's payable for investments purchased
included unsettled trades with DWR of $387,170.
15
<PAGE>
DEAN WITTER INCOME BUILDER FUND
NOTES TO FINANCIAL STATEMENTS March 31, 1998 (unaudited) continued
Morgan Stanley Dean Witter Trust FSB, an affiliate of the Investment Manager
and Distributor, is the Fund's transfer agent. At March 31, 1998, the Fund
had transfer agent fees and expenses payable of approximately $1,400.
5. SHARES OF BENEFICIAL INTEREST
Transactions in shares of beneficial interest were as follows:
<TABLE>
<CAPTION>
FOR THE SIX FOR THE YEAR
MONTHS ENDED ENDED
MARCH 31, 1998 SEPTEMBER 30, 1997*
----------------------------- -----------------------------
(UNAUDITED)
SHARES AMOUNT SHARES AMOUNT
------------- -------------- ------------- --------------
<S> <C> <C> <C> <C>
CLASS A SHARES
Sold......................................... 563,601 $ 7,177,820 84,697 $ 1,060,929
Reinvestment of dividends and distributions . 2,443 30,988 297 3,779
Redeemed..................................... (30,077) (378,443) (3,257) (41,000)
------------- -------------- ------------- --------------
Net increase -Class A........................ 535,967 6,830,365 81,737 1,023,708
------------- -------------- ------------- --------------
CLASS B SHARES
Sold......................................... 10,306,489 130,011,809 16,601,412 187,858,686
Reinvestment of dividends and distributions . 468,561 5,886,477 629,815 7,297,503
Redeemed .................................... (2,430,370) (30,880,411) (3,697,289) (42,533,458)
------------- -------------- ------------- --------------
Net increase -Class B ....................... 8,344,680 105,017,875 13,533,938 152,622,731
------------- -------------- ------------- --------------
CLASS C SHARES
Sold......................................... 287,827 3,648,599 80,094 1,000,747
Reinvestment of dividends and distributions . 3,717 47,070 519 6,601
Redeemed..................................... (12,534) (160,267) (3,561) (44,293)
------------- -------------- ------------- --------------
Net increase -Class C ....................... 279,010 3,535,402 77,052 963,055
------------- -------------- ------------- --------------
CLASS D SHARES
Sold......................................... 8,377 106,294 1,633 20,015
Reinvestment of dividends and distributions 114 1,449 15 193
Redeemed..................................... (1,059) (13,808) -- --
------------- -------------- ------------- --------------
Net increase -Class D........................ 7,432 93,935 1,648 20,208
------------- -------------- ------------- --------------
Net increase in Fund......................... 9,167,089 $115,477,577 13,694,375 $154,629,702
============= ============== ============= ==============
</TABLE>
- ------------
* For Class A, C and D, for the period July 28, 1997 (issue date) through
September 30, 1997.
16
<PAGE>
DEAN WITTER INCOME BUILDER FUND
FINANCIAL HIGHLIGHTS
Selected ratios and per share data for a share of beneficial interest
outstanding throughout each period:
<TABLE>
<CAPTION>
FOR THE SIX FOR THE YEAR FOR THE PERIOD
MONTHS ENDED ENDED JUNE 26, 1996*
MARCH 31, SEPTEMBER 30, THROUGH
1998++ 1997**++ SEPTEMBER 30, 1996
- --------------------------------------- --------------- --------------------- ------------------
(UNAUDITED)
<S> <C> <C> <C>
CLASS B SHARES
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period ... $12.81 $10.23 $10.00
--------------- --------------------- ------------------
Net investment income................... 0.24 0.46 0.08
Net realized and unrealized gain ....... 0.80 2.54 0.23
--------------- --------------------- ------------------
Total from investment operations ....... 1.04 3.00 0.31
--------------- --------------------- ------------------
Less dividends and distributions from:
Net investment income.................. (0.23) (0.41) (0.08)
Net realized gain...................... (0.59) (0.01) --
--------------- --------------------- ------------------
Total dividends and distributions ...... (0.82) (0.42) (0.08)
--------------- --------------------- ------------------
Net asset value, end of period.......... $13.03 $12.81 $10.23
=============== ===================== ==================
TOTAL INVESTMENT RETURN+................ 8.55%(1) 29.83% 3.10% (1)
RATIOS TO AVERAGE NET ASSETS:
Expenses................................ 1.77%(2) 1.85% 2.25% (2)
Net investment income................... 3.73%(2) 4.16% 3.60% (2)
SUPPLEMENTAL DATA:
Net assets, end of period, in
thousands.............................. $473,832 $358,973 $148,142
Portfolio turnover rate................. 31%(1) 74% 7% (1)
Average commission rate paid............ $0.0549 $0.0558 $0.0558
</TABLE>
- ------------
* Commencement of operations.
** Prior to July 28, 1997 the Fund issued one class of shares. All
shares held prior to that date have been designated Class B shares.
++ The per share amounts were computed using an average number of shares
outstanding during the period.
+ Does not reflect the deduction of sales charge. Calculated based on
the net asset value as of the last business day of the period.
(1) Not annualized.
(2) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS
17
<PAGE>
DEAN WITTER INCOME BUILDER FUND
FINANCIAL HIGHLIGHTS, continued
<TABLE>
<CAPTION>
FOR THE PERIOD
FOR THE SIX JULY 28, 1997*
MONTHS ENDED THROUGH
MARCH 31, SEPTEMBER 30,
1998++ 1997++
- --------------------------------------- --------------- -------------------
(UNAUDITED)
<S> <C> <C>
CLASS A SHARES
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period ... $12.81 $12.20
--------------- -------------------
Net investment income................... 0.28 0.12
Net realized and unrealized gain ....... 0.80 0.61
--------------- -------------------
Total from investment operations ....... 1.08 0.73
--------------- -------------------
Less dividends and distributions from:
Net investment income.................. (0.27) (0.12)
Net realized gain...................... (0.59) --
--------------- -------------------
Total dividends and distributions ...... (0.86) (0.12)
--------------- -------------------
Net asset value, end of period.......... $13.03 $12.81
=============== ===================
TOTAL INVESTMENT RETURN+................ 8.89% (1) 5.95% (1)
RATIOS TO AVERAGE NET ASSETS:
Expenses................................ 1.16% (2) 1.28% (2)
Net investment income................... 4.43% (2) 5.77% (2)
SUPPLEMENTAL DATA:
Net assets, end of period, in
thousands.............................. $8,049 $1,047
Portfolio turnover rate................. 31% (1) 74%
Average commission rate paid............ $0.0549 $0.0558
CLASS C SHARES
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period ... $12.80 $12.20
--------------- -------------------
Net investment income................... 0.23 0.10
Net realized and unrealized gain ....... 0.81 0.61
--------------- -------------------
Total from investment operations ....... 1.04 0.71
--------------- -------------------
Less dividends and distributions from:
Net investment income.................. (0.24) (0.11)
Net realized gain...................... (0.59) --
--------------- -------------------
Total dividends and distributions ...... (0.83) (0.11)
--------------- -------------------
Net asset value, end of period.......... $13.01 $12.80
=============== ===================
TOTAL INVESTMENT RETURN+................ 8.51% (1) 5.79% (1)
RATIOS TO AVERAGE NET ASSETS:
Expenses................................ 1.92% (2) 1.98% (2)
Net investment income................... 3.65% (2) 4.61% (2)
SUPPLEMENTAL DATA:
Net assets, end of period, in
thousands.............................. $4,632 $987
Portfolio turnover rate................. 31% (1) 74%
Average commission rate paid............ $0.0549 $0.0558
</TABLE>
- ------------
* The date shares were first issued.
++ The per share amounts were computed using an average number of shares
outstanding during the period.
+ Does not reflect the deduction of sales charge. Calculated based on
the net asset value as of the last business day of the period.
(1) Not annualized.
(2) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS
18
<PAGE>
DEAN WITTER INCOME BUILDER FUND
FINANCIAL HIGHLIGHTS, continued
<TABLE>
<CAPTION>
FOR THE PERIOD
FOR THE SIX JULY 28, 1997*
MONTHS ENDED THROUGH
MARCH 31, SEPTEMBER 30,
1998++ 1997++
- --------------------------------------- --------------- -------------------
(UNAUDITED)
<S> <C> <C>
CLASS D SHARES
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period ... $12.82 $12.20
--------------- -------------------
Net investment income................... 0.29 0.12
Net realized and unrealized gain ....... 0.80 0.62
--------------- -------------------
Total from investment operations ....... 1.09 0.74
--------------- -------------------
Less dividends and distributions from:
Net investment income.................. (0.28) (0.12)
Net realized gain...................... (0.59) --
--------------- -------------------
Total dividends and distributions ...... (0.87) (0.12)
--------------- -------------------
Net asset value, end of period.......... $13.04 $12.82
=============== ===================
TOTAL INVESTMENT RETURN+................ 9.08% (1) 5.98% (1)
RATIOS TO AVERAGE NET ASSETS:
Expenses................................ 0.92% (2) 0.96% (2)
Net investment income................... 4.62% (2) 5.41% (2)
SUPPLEMENTAL DATA:
Net assets, end of period, in
thousands.............................. $118 $21
Portfolio turnover rate................. 31% (1) 74%
Average commission rate paid............ $0.0549 $0.0558
</TABLE>
- ------------
* The date shares were first issued.
++ The per share amounts were computed using an average number of shares
outstanding during the period.
+ Calculated based on the net asset value as of the last business day
of the period.
(1) Not annualized.
(2) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS
19
<PAGE>
TRUSTEES
Michael Bozic
Charles A. Fiumefreddo
Edwin J. Garn
John R. Haire
Wayne E. Hedien
Dr. Manuel H. Johnson
Michael E. Nugent
Philip J. Purcell
John L. Schroeder
OFFICERS
Charles A. Fiumefreddo
Chairman and Chief Executive Officer
Barry Fink
Vice President, Secretary and General Counsel
Paul D. Vance
Vice President
Peter M. Avelar
Vice President
Thomas F. Caloia
Treasurer
TRANSFER AGENT
Morgan Stanley Dean Witter Trust FSB
Harborside Financial Center - Plaza Two
Jersey City, New Jersey 07311
INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP
1177 Avenue of the Americas
New York, New York 10036
INVESTMENT MANAGER
Dean Witter InterCapital Inc.
Two World Trade Center
New York, New York 10048
The financial statements included herein have been taken from the records of
the Fund without examination by the independent accountants and accordingly
they do not express an opinion thereon.
This report is submitted for the general information of shareholders of the
Fund. For more detailed information about the Fund, its officers and trsutees,
fees, expenses and other pertinent information, please see the prospectus of
the Fund.
This report is not authorized for distribution to prospective investors in the
Fund unless preceded or accompanied by an effective prospectus.
DEAN WITTER
INCOME BUILDER
FUND
SEMIANNUAL REPORT
MARCH 31, 1998
