DELAWARE GROUP DECATUR FUND INC, 497, 1995-08-29

DELAWARE GROUP DECATUR FUND INC
497, 1995-08-29

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The Delaware Group includes 22 different
funds with a wide range of investment
objectives. Stock funds, income funds,
tax-free funds, money market funds and
closed-end equity funds give investors the
ability to create a portfolio that fits their
personal financial goals. For more information,
shareholders of the Fund Classes should contact
their financial adviser or call the Delaware
Group at 800-523-4640, in Philadelphia
215-988-1333 and shareholders of the
Institutional Class should contact the
Delaware Group at 800-828-5052.

INVESTMENT MANAGER
Delaware Management Company, Inc.
One Commerce Square
Philadelphia, PA 19103
NATIONAL DISTRIBUTOR
Delaware Distributors, L.P.
1818 Market Street
Philadelphia, PA 19103
SHAREHOLDER SERVICING,
DIVIDEND DISBURSING
AND TRANSFER AGENT
Delaware Service Company, Inc.
1818 Market Street
Philadelphia, PA 19103
LEGAL COUNSEL
Stradley, Ronon, Stevens & Young
One Commerce Square
Philadelphia, PA 19103
INDEPENDENT AUDITORS
Ernst & Young LLP
Two Commerce Square
Philadelphia, PA 19103
CUSTODIAN
Chemical Bank
450 West 33rd Street
New York, NY 10001

AI-018/AI-066/AI-050-1/95-U

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DECATUR
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TOTAL RETURN
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FUND
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A CLASS
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B CLASS
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INSTITUTIONAL CLASS
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CLASSES OF DELAWARE GROUP
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DECATUR FUND, INC.
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PART B

STATEMENT OF
ADDITIONAL INFORMATION
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JANUARY 30, 1995

DELAWARE
GROUP
------------

<PAGE>

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PART B--STATEMENT OF ADDITIONAL INFORMATION
JANUARY 30, 1995
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DELAWARE GROUP
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DECATUR FUND, INC.
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DECATUR
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TOTAL RETURN
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FUND
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1818 MARKET STREET
PHILADELPHIA, PA 19103
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FOR MORE INFORMATION ABOUT THE INSTITUTIONAL CLASS:
800-828-5052

FOR PROSPECTUS AND PERFORMANCE OF THE FUND CLASSES:
NATIONWIDE 800-523-4640
PHILADELPHIA 988-1333

INFORMATION ON EXISTING ACCOUNTS OF THE FUND
CLASSES:
(SHAREHOLDERS ONLY)
NATIONWIDE 800-523-1918
PHILADELPHIA 988-1241

DEALER SERVICES:
(BROKER/DEALERS ONLY)
NATIONWIDE 800-362-7500
PHILADELPHIA 988-1050
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TABLE OF CONTENTS
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COVER PAGE 1
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INVESTMENT POLICIES AND PORTFOLIO TECHNIQUES 2
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ACCOUNTING AND TAX ISSUES 6
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PERFORMANCE INFORMATION 6
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TRADING PRACTICES AND BROKERAGE 9
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PURCHASING SHARES 11
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INVESTMENT PLANS 16
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DETERMINING OFFERING PRICE AND
NET ASSET VALUE 19
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REDEMPTION AND REPURCHASE 20
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DISTRIBUTIONS AND TAXES 22
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INVESTMENT MANAGEMENT AGREEMENT 23
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OFFICERS AND DIRECTORS 24
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EXCHANGE PRIVILEGE 28
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GENERAL INFORMATION 30
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APPENDIX A--IRA INFORMATION 31
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APPENDIX B 35
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FINANCIAL STATEMENTS 36
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<PAGE>

Delaware Group Decatur Fund, Inc. (the "Fund") is a professionally-managed
mutual fund of the series type. This STATEMENT OF ADDITIONAL INFORMATION ("PART
B" of the registration statement) describes the Decatur Total Return Fund series
(the "Series") of the Fund. The Series offers three classes (individually, a
"Class" and collectively, the "Classes") of shares-Decatur Total Return Fund A
Class (the "Class A Shares"), Decatur Total Return Fund B Class (the "Class B
Shares"), (Class A Shares and Class B Shares together, referred to as "Fund
Classes") and Decatur Total Return Fund Institutional Class (the "Institutional
Class"). Class B Shares and Institutional Class shares of the Series may be
purchased at a price equal to the next determined net asset value per share.
Class A Shares of the Series may be purchased at the public offering price,
which is equal to the next determined net asset value per share, plus a
front-end sales charge. The Class A Shares are subject to a maximum front-end
sales charge of 5.75% and annual 12b-1 Plan expenses. The Class B Shares are
subject to a contingent deferred sales charge ("CDSC") which may be imposed on
redemptions made within six years of purchase and 12b-1 Plan expenses which are
higher than those to which Class A Shares are subject and are assessed against
the Class B Shares for no longer than approximately eight years after purchase.
See AUTOMATIC CONVERSION OF CLASS B SHARES in the Fund Classes' PROSPECTUS. All
references to "shares" in this PART B refer to all Classes of shares of the
Series, except where noted.
This PART B supplements the information contained in the current PROSPECTUSES
for the Fund Classes and the Institutional Class dated January 30, 1995, as may
be amended from time to time. It should be read in conjunction with the
respective Class' PROSPECTUS. PART B is not itself a prospectus but is, in its
entirety, incorporated by reference into each Class' PROSPECTUS. A PROSPECTUS
relating to the Fund Classes and a PROSPECTUS relating to the Institutional
Class may be obtained by writing or calling your investment dealer or by
contacting the Fund's national distributor, Delaware Distributors, L.P. (the
"Distributor"), 1818 Market Street, Philadelphia, PA 19103.
1
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INVESTMENT POLICIES AND
PORTFOLIO TECHNIQUES

INVESTMENT RESTRICTIONS--The Fund has adopted the following restrictions
for the Series which, along with its investment objective, cannot be changed
without approval by the holders of a "majority" of the Series' outstanding
shares, which is a vote by the holders of the lesser of a) 67% or more of the
voting securities present in person or by proxy at a meeting, if the holders
of more than 50% of the outstanding voting securities are present or
represented by proxy; or b) more than 50% of the outstanding voting
securities. The percentage limitations contained in the restrictions and
policies set forth herein apply at the time of purchase of securities.
The Series shall not:
1. Invest more than 5% of the market or other fair
value of its assets in the securities of any one issuer (other than
obligations of, or guaranteed by, the U.S. government, its agencies or
instrumentalities).
2. Invest in securities of other investment companies except as part of a
merger, consolidation or other acquisition.
3. Make loans. However, (i) the purchase of a portion
of an issue of publicly distributed bonds, debentures or other securities, or
of other securities authorized to be purchased by the Series' investment
policies, whether or not the purchase was made upon the original issuance of
the securities, and the entry into "repurchase agreements" are not to be
considered the making of a loan by the Series; and (ii) the Series may loan
up to 25% of its assets to qualified broker/dealers or institutional
investors for their use relating to short sales or other security
transactions.
4. Purchase or sell real estate but this shall not prevent the Series from
investing in companies which own real estate or in securities secured by real
estate or interests therein.
5. Purchase more than 10% of the outstanding voting
or nonvoting securities of any issuer, or invest in companies for the purpose
of exercising control or management.
6. Act as an underwriter of securities of other issuers, except that the
Series may acquire restricted or not readily marketable securities under
circumstances where, if such securities are sold, the Series might be deemed
to be an underwriter for the purposes of the Securities Act of 1933.
7. Make any investment which would cause more than 25% of the market or
other fair value of its total assets to be invested in the securities of
issuers all of which conduct their principal business activities in the same
industry. This restriction does not apply to obligations issued or guaranteed
by the U.S. government, its agencies or instrumentalities.
8. Deal in commodities, except that the Series may invest in financial
futures, including futures contracts on stocks and stock indices, interest
rates and foreign currencies and other types of financial futures that may be
developed in the future, and may purchase or sell options on such futures,
and enter into closing transactions with respect to those activities.
<PAGE>

9. Purchase securities on margin, make short sales of securities or
maintain a net short position.
10. Invest more than 5% of the value of its total assets in securities of
companies less than three years old. Such three-year period shall include the
operation of any
predecessor company or companies.
11. Invest in warrants valued at lower of cost or market exceeding 5% of
the Series' net assets. Included in that amount, but not to exceed 2% of the
Series' net assets, may be warrants not listed on the New York Stock Exchange
or American Stock Exchange.
12. Purchase or retain the securities of any issuer which has an officer,
director or security holder who is a director or officer of the Fund or of
its investment manager if or so long as the directors and officers of the
Fund and of its investment manager together own beneficially more than 5% of
any class of securities of such issuer.
13. Invest in interests in oil, gas or other mineral exploration or
development programs.
14. Invest more than 10% of the value of the Series' net assets in
repurchase agreements maturing in more than seven days and in other illiquid
assets.
15. Borrow money in excess of one-third of the value of its net assets and
then only as a temporary measure for extraordinary purposes or to facilitate
redemptions. The Series has no intention of increasing its net income through
borrowing. Any borrowing will be done from a bank and to the extent that such
borrowing exceeds 5% of the value of the Series' net assets, asset coverage
of at least 300% is required. In the event that such asset coverage shall at
any time fall below 300%, the Series shall, within three days thereafter (not
including Sunday or holidays) or such longer period as the Securities and
Exchange Commission may prescribe by rules and regulations, reduce the amount of
its borrowings to such an extent that the asset coverage of such borrowings
shall be at least 300%. The Series will not pledge more than 10% of its net
assets. The Series will not issue senior securities as defined in the Investment
Company Act of 1940, except for notes to banks.
Although not a fundamental investment restriction, the Series currently does
not invest its assets in real estate limited partnerships.
The application of the Series' investment policy will be dependent upon the
judgment of Delaware Management Company, Inc. (the "Manager"). In accordance
with the judgment of the Manager, the proportions of the Series' assets invested
in particular industries will vary from time to time. The securities in which
the Series invests may or may not be listed on a national stock exchange, but if
they are not so listed will generally have an established over-the-counter
market. While management believes that the investment objective can be achieved
by investing in common stock, the portfolio may be invested in other securities
including, but not limited to, convertible securities, preferred stocks, bonds,
warrants and foreign securities. In periods during which the Manager feels that
market conditions warrant a more defensive portfolio positioning, the Series may
also invest temporarily in various types of fixed income obligations.

2
<PAGE>

Securities will not normally be purchased while the Series has an
outstanding borrowing.
Although it is not a matter of fundamental policy, the Fund may invest not
more than 5% of its assets in foreign securities (other than securities of
Canadian issuers registered under the Securities Exchange Act of 1934 or
American Depository Receipts, on which there are no such limits). Foreign
markets may be more volatile than U.S. markets. Such investments involve
sovereign risk in addition to the normal risks associated with American
securities. These risks include political risks, foreign taxes and exchange
controls and currency fluctuations. For example, foreign portfolio
investments may fluctuate in value due to changes in currency rates (i.e.,
the value of foreign investments would increase with a fall in the value of
the dollar, and decrease with a rise in the value of the dollar) and control
regulations apart from market fluctuations. The Fund may also experience delays
in foreign securities settlement.
In addition, from time to time, the Series may also engage in the following
investment techniques:
A. OPTIONS--The Series may write call options and purchase put options on a
covered basis only, and will not engage in option writing strategies for
speculative purposes.

COVERED CALL WRITING
The Series may write covered call options from time to time on such portion
of its portfolio, without limit, as the Manager determines is appropriate in
seeking to obtain the Series' investment objective. A call option gives the
purchaser of such option the right to buy, and the writer, in this case the
Series, has the obligation to sell the underlying security at the exercise
price during the option period. The advantage to the Series of writing
covered calls is that the Series receives additional income, in the form of a
premium, which may offset any capital loss or decline in market value of the
security. However, if the security rises in value, the Series may not fully
participate in the market appreciation.
During the option period, a covered call option writer may be assigned an
exercise notice by the broker/dealer through whom such call option was sold
requiring the writer to deliver the underlying security against payment of the
exercise price. This obligation is terminated upon the expiration of the option
period or at such earlier time in which the writer effects a closing purchase
transaction. A closing purchase transaction cannot be effected with respect to
an option once the option writer has received an exercise notice for such
option.
With respect to both options on actual portfolio securities owned by the
Series and options on stock indices, the Series may enter into closing
purchase transactions. A closing purchase transaction is one in which the
Series, when obligated as a writer of an option, terminates its obligation by
purchasing an option of the same series as the option previously written.

<PAGE>

Closing purchase transactions will ordinarily be effected to realize a
profit on an outstanding call option, to prevent an underlying security from
being called, to permit the sale of the underlying security or to enable the
Series to write another call option on the underlying security with either a
different exercise price or expiration date or both. The Series may realize a
net gain or loss from a closing purchase transaction depending upon whether
the net amount of the original premium received on the call option is more or
less than the cost of effecting the closing purchase transaction. Any loss
incurred in a closing purchase transaction may be partially or entirely
offset by the premium received from a sale of a different call option on the
same underlying security. Such a loss may also be wholly or partially offset
by unrealized appreciation in the market value of the underlying security.
Conversely, a gain resulting from a closing purchase transaction could be
offset in whole or in part by a decline in the market value of the underlying
security.
If a call option expires unexercised, the Series will realize a short-term
capital gain in the amount of the premium on the option, less the commission
paid. Such a gain, however, may be offset by depreciation in the market value
of the underlying security during the option period. If a call option is
exercised, the Series will realize a gain or loss from the sale of the
underlying security equal to the difference between the cost of the
underlying security, and the proceeds of the sale of the security plus the
amount of the premium on the option, less the commission paid.
The market value of a call option generally reflects the market price of an
underlying security. Other principal factors affecting market value include
supply and demand, interest rates, the price volatility of the underlying
security and the time remaining until the expiration date.
The Series will write call options only on a covered basis, which means
that the Series will own the underlying security subject to a call option at
all times during the option period. Unless a closing purchase transaction is
effected, the Series would be required to continue to hold a security which
it might otherwise wish to sell, or deliver a security it would want to hold.
Options written by the Series will normally have expiration dates between one
and nine months from the date written. The exercise price of a call option
may be below, equal to or above the current market value of the underlying
security at the time the option is written.

PURCHASING PUT OPTIONS
The Series may invest up to 2% of its total assets in the purchase of put
options. The Series will, at all times during which it holds a put option,
own the security covered by such option.
The Series intends to purchase put options in order to protect against a
decline in the market value of the underlying security below the exercise
price less the premium paid for the option ("protective puts"). The ability
to purchase put options will allow the Series to protect an unrealized gain
in an appreciated security in its portfolio without actually selling the
security. If the security does not drop in value, the Series will lose the
value of the premium paid. The Series may sell a put option which it has
previously purchased prior to the sale of the securities underlying such
option. Such sales will result in a net gain or loss depending on whether the
amount received on the sale is more or less than the premium and other
transaction costs paid on the put option which is sold.
3
<PAGE>

The Series may sell a put option purchased on individual portfolio
securities or stock indices. Additionally, the Series may enter into closing
sale transactions. A closing sale transaction is one in which the Series,
when it is the holder of an outstanding option, liquidates its position
by selling an option of the same series as the option
previously purchased.

OPTIONS ON STOCK INDICES
A stock index assigns relative values to the common stocks included in the
index with the index fluctuating with changes in the market values of the
underlying common stock.
Options on stock indices are similar to options on stocks but have different
delivery requirements. Stock options provide the right to take or make delivery
of the underlying stock at a specified price. A stock index option gives the
holder the right to receive a cash "exercise settlement amount" equal to (i) the
amount by which the fixed exercise price of the option exceeds (in the case of a
put) or is less than (in the case of a call) the closing value of the underlying
index on the date of exercise, multiplied by (ii) a fixed "index multiplier."
Receipt of this cash amount will depend upon the closing level of the stock
index upon which the option is based being greater than (in the case of a call)
or less than (in the case of a put) the exercise price of the option. The amount
of cash received will be equal to such difference between the closing price of
the index and exercise price of the option expressed in dollars times a
specified multiple. The writer of the option is obligated, in return for the
premium received, to make delivery of this amount. Gain or loss to the Series on
transactions in stock index options will depend on price movements in the stock
market generally (or in a particular industry or segment of the market) rather
than price movements of individual securities.
As with stock options, the Series may offset its position in stock index
options prior to expiration by entering into a closing transaction on an
Exchange or it may let the option expire unexercised.
A stock index fluctuates with changes in the market values of the stock so
included. Some stock index options are based on a broad market index such as
the Standard & Poor's 500 or the New York Stock Exchange Composite Index, or
a narrower market index such as the Standard & Poor's 100. Indices are also
based on an industry or market segment such as the AMEX Oil and Gas Index or
the Computer and Business Equipment Index. Options on stock indices are
currently traded on the following Exchanges among others: The Chicago Board
Options Exchange, New York Stock Exchange and American Stock Exchange.

<PAGE>

The effectiveness of purchasing or writing stock index options as a hedging
technique will depend upon the extent to which price movements in the Series'
portfolio correlate with price movements of the stock index selected. Because
the value of an index option depends upon movements in the level of the index
rather than the price of a particular stock, whether the Series will realize
a gain or loss from the purchase or writing of options on an index depends
upon movements in the level of stock prices in the stock market generally or,
in the case of certain indices, in an industry or market segment, rather than
movements in the price of a particular stock. Since the Series' portfolio
will not duplicate the components of an index, the correlation will not be
exact. Consequently, the Series bears the risk that the prices of the
securities being hedged will not move in the same amount as the hedging
instrument. It is also possible that there may be a negative correlation
between the index or other securities underlying the hedging instrument and
the hedged securities which would result in a loss on both such securities
and the hedging instrument. Accordingly, successful use by the Series of
options on stock indices will be subject to the Manager's ability to predict
correctly movements in the direction of the stock market generally or of a
particular industry. This requires different skills and techniques than
predicting changes in the price of individual stocks.
Positions in stock index options may be closed out only on an Exchange
which provides a secondary market. There can be no assurance that a liquid
secondary market will exist for any particular stock index option. Thus, it
may not be possible to close such an option. The inability to close options
positions could have an adverse impact on the Series' ability to effectively
hedge its securities. The Series will enter into an option position only if
there appears to be a liquid secondary market for such options.
The Series will not engage in transactions in options on stock indices for
speculative purposes but only to protect appreciation attained, to offset
capital losses and to take advantage of the liquidity available in the option
markets.
B. FUTURES CONTRACTS AND OPTIONS ON FUTURES CONTRACTS--As noted in the
PROSPECTUS, the Series may enter into futures contracts relating to securities,
securities indices, interest rates or foreign currencies. (Unless otherwise
specified, interest rate futures contracts, securities and securities index
futures contracts and foreign currency futures contracts are collectively
referred to as "futures contracts.") Such investment strategies will be used as
a hedge and not for speculation.
As noted in the PROSPECTUS, the Series may purchase and write options on
the types of futures contracts, as further described in the PROSPECTUS.
The writing of a call option on a futures contract constitutes a partial
hedge against declining prices of the securities in the Series' portfolio. If
the futures price at expiration of the option is below the exercise price, the
Series will retain the full amount of the option premium, which provides a
partial hedge against any decline that may have occurred in the Series'
portfolio holdings. The writing of a put option on a futures contract
constitutes a partial hedge against increasing prices of the securities or other
instruments required to be delivered under the terms of the futures contract. If
the futures price at expiration of the put option is higher than the exercise
price, the Series will retain the full amount of the option premium, which
provides a partial hedge against any increase in the price of securities which
the Series intends to purchase. If a put or call option the Series has written
is exercised, the Series will incur a loss which will be reduced by the amount
of the premium it receives. Depending on the degree of correlation between
changes in the value of its portfolio securities and changes in the value of its
options on futures positions, the Series' losses from exercised options on
futures may to some extent be reduced or increased by changes in the value of
portfolio securities.
4
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The Series may purchase options on futures contracts for hedging purposes
instead of purchasing or selling the underlying futures contracts. For
example, where a decrease in the value of portfolio securities is anticipated
as a result of a projected market-wide decline or changes in interest or
exchange rates, the Series could, in lieu of selling futures contracts,
purchase put options thereon. In the event that such decrease occurs, it may
be offset, in whole or part, by a profit on the option. If the market decline
does not occur, the Series will suffer a loss equal to the price of the put.
Where it is projected that the value of securities to be acquired by the
Series will increase prior to acquisition, due to a market advance or changes
in interest or exchange rates, the Series could purchase call options on
futures contracts, rather than purchasing the underlying futures contracts.
If the market advances, the increased cost of securities to be purchased may
be offset by a profit on the call. However, if the market declines, the
Series will suffer a loss equal to the price of the call, but the securities w
hich the Series intends to purchase may be less expensive.
C. REPURCHASE AGREEMENTS--In order to invest its cash reserves or when in a
temporary defensive posture, the Series may enter into repurchase agreements
with banks or broker/dealers deemed to be creditworthy by the Manager, under
guidelines approved by the Board of Directors. A repurchase agreement is a
short-term investment in which the purchaser (i.e., the Series) acquires
ownership of a debt security and the seller agrees to repurchase the
obligation at a future time and set price, thereby determining the yield
during the purchaser's holding period. Generally, repurchase agreements are
of short duration, often less than one week, but on occasion for longer
periods. Not more than 10% of the Series' assets may be invested in
repurchase agreements of over seven-days' maturity or other illiquid assets.
Should an issuer of a repurchase agreement fail to repurchase the underlying
security, the loss to the Series, if any, would be the difference between the
repurchase price and the market value of the security. The Series will limit
its investments in repurchase agreements to those which the Manager, under
the guidelines of the Board of Directors, determines to present minimal
credit risks and which are of high quality. In addition, the Series must have
collateral of at least 100% of the repurchase price, including the portion
representing the Series' yield under such agreements which is monitored on a
daily basis. Such collateral is held by the Custodian in book entry form.
Such agreements may be considered loans under the Investment Company Act, but
the Series considers repurchase agreements contracts for the purchase and
sale of securities, and it seeks to perfect a security interest in the
collateral securities so that it has the right to keep and dispose of the
underlying collateral in the event of default.

<PAGE>

The funds in the Delaware Group have obtained exemption from the
joint-transaction prohibitions of Section 17(d) of the Investment Company Act
of 1940 to allow the Delaware Group funds jointly to invest cash balances.
Each Series of the Fund may invest cash balances in a joint repurchase
agreement in accordance with the terms of the Order and subject generally to
the conditions described above.

PORTFOLIO LOAN TRANSACTIONS
The Series may loan up to 25% of its assets to qualified broker/dealers or
institutional investors for their use relating to short sales or other
security transactions.
It is the understanding of the Manager that the staff of the Securities
and Exchange Commission permits portfolio lending by registered investment
companies if certain conditions are met. These conditions are as follows: 1)
each transaction must have 100% collateral in the form of cash, short-term
U.S. government securities, or irrevocable letters of credit payable by banks
acceptable to the Fund from the borrower; 2) this collateral must be valued
daily and should the market value of the loaned securities increase, the
borrower must furnish additional collateral to the Series; 3) the Fund must
be able to terminate the loan after notice, at any time; 4) the Series must
receive reasonable interest on any loan, and any dividends, interest or other
distributions on the lent securities, and any increase in the market value of
such securities; 5) the Series may pay reasonable custodian fees in
connection with the loan; and 6) the voting rights on the lent securities may
pass to the borrower; however, if the directors of the Fund know that a
material event will occur affecting an investment loan, they must either
terminate the loan in order to vote the proxy or enter into an alternative
arrangement with the borrower to enable the directors to vote the proxy.
The major risk to which the Series would be exposed on a loan transaction
is the risk that the borrower would go bankrupt at a time when the value of
the security goes up. Therefore, the Series will only enter into loan
arrangements after a review of all pertinent facts by the Manager, under the
supervision of the Board of Directors, including the creditworthiness of the
borrowing broker, dealer or institution and then only if the consideration to
be received from such loans would justify the risk. Creditworthiness will be
monitored on an ongoing basis by the Manager.

* * *
The Series may invest in restricted securities, including unregistered
securities eligible for resale without registration pursuant to Rule 144A ("Rule
144A Securities") under the Securities Act of 1933 ("1933 Act"). Rule 144A
Securities may be freely traded among qualified institutional investors without
registration under the 1933 Act.

<PAGE>

Investing in Rule 144A Securities could have the effect of increasing the
level of the Series' illiquidity to the extent that qualified institutional
buyers become, for a time, uninterested in purchasing these securities. After
the purchase of a Rule 144A Security, however, the Board of Directors and the
Manager will continue to monitor the liquidity of that security to ensure
that the Series has no more than 10% of its net assets in illiquid
securities.

ACCOUNTING AND TAX ISSUES

When the Series writes a call option, an amount equal to the premium
received by it is included in the section of the Series' assets and
liabilities as an asset and as an equivalent liability. The amount of the
liability is subsequently "marked to market" to reflect the current market
value of the option written. The current market value of a written option is
the last sale price on the principal Exchange on which such option is traded
or, in the absence of a sale, the mean between the last bid and asked prices.
If an option which the Series has written expires on its stipulated
expiration date, the Series reports a realized gain. If the Series enters
into a closing purchase transaction with respect to an option which the
Series has written, the Series realizes a gain (or loss if the cost of the
closing transaction exceeds the premium received when the option was sold)
without regard to any unrealized gain or loss on the underlying security, and
the liability related to such option is extinguished. Any such gain or loss
is a short-term capital gain or loss for federal income tax purposes. If a
call option which the Series has written is exercised, the Series realizes a
capital gain or loss (long-term or short-term, depending on the holding
period of the underlying security) from the sale of the underlying security
and the proceeds from such sale are increased by the premium originally
received.
OTHER TAX REQUIREMENTS--The Series has qualified, and intends to continue
to qualify, as a regulated investment company under Subchapter M of the
Internal Revenue Code of 1986, as amended. The Series must meet several requir
ements to maintain its status as a regulated investment company. Among these
requirements are that at least 90% of its investment company taxable income
be derived from dividends, interest, payment with respect to securities loans
and gains from the sale or disposition of securities; that at the close of
each quarter of its taxable year at least 50% of the value of its assets
consist of cash and cash items, government securities, securities of other
regulated investment companies and, subject to certain diversification
requirements, other securities; and that less than 30% of its gross income be
derived from sales of securities held for less than three months.
The requirement that not more than 30% of the Fund's gross income be derived
from gains from the sale or other disposition of securities held for less than
three months may restrict the Series in its ability to write covered call
options on securities which it has held less than three months, to write options
which expire in less than three months, to sell securities which have been held
less than three months and to effect closing purchase transactions with respect
to options which have been written less than three months prior to such
transactions. Consequently, in order to avoid realizing a gain within the
three-month period, the Series may be required to defer the closing out of a
contract beyond the time when it might otherwise be advantageous to do so.

<PAGE>

The straddle rules of Section 1092 may apply. Generally, the straddle
provisions require the deferral of losses to the extent of unrecognized gains
related to the offsetting positions in the straddle. Excess losses, if any,
can be recognized in the year of loss. Deferred losses will be carried
forward and recognized in the following year, subject to the same limitation.

PERFORMANCE INFORMATION

From time to time, the Series may state each Class' total return in
advertisements and other types of literature. Any statements of total return
performance data for a Class will be accompanied by information on the
average annual compounded rate of return for that Class over, as relevant,
the most recent one-, five- and ten-year (or life of fund, if applicable)
periods. The Series may also advertise aggregate and average compounded
return information of each Class over additional periods of time.
The average annual total rate of return for each Class is based on a
hypothetical $1,000 investment that includes capital appreciation and
depreciation during the stated periods. The following formula will be used
for the actual computations:

n
P(1+T) = ERV

Where: P = a hypothetical initial purchase order
of $1,000 from which the maximum
front-end sales charge with respect to
Class A Shares, if any, is deducted;
T = average annual total return;
n = number of years;
ERV = redeemable value of the hypothetical
$1,000 purchase at the end of the period
after the deduction of the applicable
CDSC, if any, with respect to Class B
Shares.

Aggregate total return is calculated in a similar manner, except that the
results are not annualized. Each calculation assumes the maximum front-end
sales charge, if any, is deducted from the initial $1,000 investment at the
time it is made with respect to the Class A Shares, and that all
distributions are reinvested at net asset value, and, with respect to Class B
Shares, includes the CDSC that would be applicable upon complete redemption
of such shares. In addition, the Series may present total return that does not
reflect the deduction of the maximum front-end sales charge or any applicable
CDSC.

<PAGE>

The performance of the Class A Shares and the Institutional Class, as shown
below, is the average annual total return quotations for the one-, three- and
five-year periods ended November 30, 1994 and for the life of the Series,
computed as described above. The average annual total return for the Class A
Shares at offer reflects the maximum front-end sales charges paid on the
purchase of shares. The average annual total return for the Class A Shares at
net asset value (NAV) does not reflect the payment of the maximum front-end
sales charge of 5.75%. Securities prices fluctuated during the periods
covered and past results should not be considered as representative of future
performance. Pursuant to applicable regulation, total return shown for the
Institutional Class for the periods prior to the commencement of operations
of such Class is calculated by taking the performance of the Class A Shares
and adjusting it to reflect the elimination of all front-end sales charges.
However, for those periods, no adjustment has been made to eliminate the
impact of 12b-1 payments, and performance would have been affected had such
an adjustment been made.

AVERAGE ANNUAL TOTAL RETURN
CLASS A CLASS A
SHARES SHARES INSTITUTIONAL
(AT OFFER) (AT NAV) CLASS**

1 year ended
11/30/94 (5.81%) (0.04%) 0.19%
3 years ended
11/30/94 7.24% 9.38% 9.52%
5 years ended
11/30/94 5.54% 6.80% 6.88%
Period 8/27/86*
to 11/30/94 9.20% 9.98% 10.03%

*Date of initial public offering of Class A Shares.
**Date of initial public offering was July 26, 1993.

The performance of the Class B Shares, as shown below, is the aggregate
total return quotation for the period September 6, 1994 (date of initial
public offering) through November 30, 1994. The aggregate total return for
Class B Shares (Including Deferred Sales Charge) reflects the deduction of
the applicable CDSC that would be paid if the shares were redeemed at
November 30, 1994. The aggregate total return for Class B Shares (Excluding
Deferred Sales Charge) assumes the shares were not redeemed at November 30,
1994 and therefore does not reflect the deduction of a CDSC.

AGGREGATE TOTAL RETURN
CLASS B SHARES CLASS B SHARES
(INCLUDING (EXCLUDING
DEFERRED DEFERRED
SALES CHARGE) SALES CHARGE)
Period 9/6/94*
through 11/30/94 (9.13%) (5.37%)

* Date of initial public offering of Class B Shares; total return for this
short of a time period may not be representative of longer-term results.

Decatur's investment strategy relies on the consistency, reliability and
predictability of corporate dividends. Dividends tend to rise over time, despite
market conditions, and keep pace with rising prices; they are paid out in
"current" dollars. And, just as important, current dividend income can help
lessen the effects of adverse market conditions. Decatur's dividend discipline,
coupled with the potential for capital gains, seeks to provide investors with a
consistently higher total-rate-of-return over time.

<PAGE>

In 1972, Delaware Investment Advisers, a division of the Manager, offered
Decatur's time-proven investment style to the institutional investing
community. Currently, Delaware Investment Advisers manages approximately $12
billion in institutional assets under management in that style.
From time to time, the Series may also quote each Class' actual total
return performance, dividend results and other performance information in
advertising and other types of literature and may compare that information
to, or may separately illustrate similar information reported by, the
Standard & Poor's 500 Stock Index and the Dow Jones Industrial Average and
other unmanaged indices.
The Standard & Poor's 500 Stock Index and the Dow Jones Industrial Average
are industry-accepted unmanaged indices of generally-conservative securities
used for measuring general market performance. The total return performance
reported will reflect the reinvestment of all distributions on a quarterly
basis and market price fluctuations. The indices do not take into account any
sales charge or other fees. In seeking a particular investment objective, the
Series' portfolio primarily includes common stocks considered by the Manager
to be more aggressive than those tracked by these indices.
The total return performance for each Class will be computed by adding all
reinvested income and realized securities profits distributions plus the
change in net asset value during a specific period and dividing by the
offering price at the beginning of the period. It will also reflect the
maximum front-end sales charge, if any, paid for the illustrated investment
amount, but not any income taxes payable by shareholders on the reinvested
distributions included in the calculation. Because securities prices
fluctuate, past performance should not be considered as a representation of
the results which may be realized from an investment in the Series in the
future.
The Series may also state the total return performance for each Class in the
form of an average annual return. This average annual return figure will be
computed by taking the sum of a Class' annual returns, then dividing that figure
by the number of years in the overall period indicated. The computation will
reflect the impact of the maximum front-end or contingent deferred sales charge,
if any, paid on the illustrated investment amount against the first year's
return. From time to time, the Series may quote actua l total return performance
for each Class in advertising and other types of literature compared to indices
or averages of alternative financial products available to prospective
investors. For example, the performance comparisons may include the average
return of various bank instruments, some of which may carry certain return
guarantees offered by leading banks and thrifts as monitored by BANK RATE
MONITOR, and those of generally-accepted corporate bond and government security
price indices of various durations prepared by Lehman Brothers and Salomon
Brothers, Inc. These indices are not managed for any investment goal.

7
<PAGE>

Comparative information on the Consumer Price Index may also be included.
The Consumer Price Index, as prepared by the U.S. Bureau of Labor Statistics,
is the most commonly used measure of inflation. It indicates the cost
fluctuations of a representative group of consumer goods. It does not
represent a return from an investment.
Statistical and performance information and various indices compiled and
maintained by organizations such as the following may also be used in
preparing exhibits comparing certain industry trends and competitive mutual fu
nd performance to comparable Series activity and performance and in
illustrating general financial planning principles. From time to time,
certain mutual fund performance ranking information, calculated and provided
by these organizations, may also be used in the promotion of sales in the
Series. Any indices used are not managed for any investment goal.

CDA TECHNOLOGIES, INC., LIPPER ANALYTICAL SERVICES, INC. and MORNINGSTAR,
INC. are performance evaluation services that maintain statistical
performance databases, as reported by a diverse universe of
independently-managed mutual funds.

IBBOTSON ASSOCIATES, INC. is a consulting firm that provides a variety
of historical data including total return, capital appreciation and income
on the stock market as well as other investment asset classes, and
inflation. With their permission, this information will be used primarily
for comparative purposes and to illustrate general financial planning
principles.

INTERACTIVE DATA CORPORATION is a statistical access service that
maintains a database of various international industry indicators, such as
historical and current price/earning information, individual equity and
fixed income price and return information.

COMPUSTAT INDUSTRIAL DATABASES, a service of Standard & Poor's, may
also be used in preparing performance and historical stock and bond market
exhibits. This firm maintains fundamental databases that provide financial,
statistical and market information covering more than 7,000 industrial and
non-industrial companies.

<PAGE>

RUSSELL INDEXES is an investment analysis service that provides both
current and historical stock performance information, focusing on the
business fundamentals of those firms issuing the security.

SALOMON BROTHERS and LEHMAN BROTHERS are statistical research firms
that maintain databases of international market, bond market, corporate
and government-issued securities of various maturities. This information,
as well as unmanaged indices compiled and maintained by these firms, will
be used in preparing comparative illustrations.

The performance of each Class will reflect maximum front-end or contingent
deferred sales charges, if any, paid on the purchase or redemption of shares,
as applicable, but not any income taxes payable by shareholders on the
reinvested distributions included in the calculations. The net asset value of
a Class fluctuates so shares, when redeemed, may be worth more or less than
the original investment, and a Class' results should not be considered as
representative of future performance.

The following table is an example, for purposes of illustration only, of
cumulative total return performance for the Class A Shares and the Institutional
Class for the three-, six- and nine-month periods ended November 30, 1994, for
the one-, three- and five-year periods ended November 30, 1994 and for the life
of the Series. Cumulative total return for the Class B Shares for the period
September 6, 1994 (date of initial public offering) through November 30, 1994 is
also provided below. For these purposes, the calculations assume the
reinvestment of any realized securities profits distributions and income
dividends paid during the indicated periods. Comparative information on the
Standard & Poor's 500 Stock Index and the Dow Jones Industrial Average is also
included. Pursuant to applicable regulation, total return shown for the
Institutional Class for the periods prior to the commencement of operations of
such Class is calculated by taking the performance of the Class A Shares and
adjusting it to reflect the elimination of all sales charges. However, for those
periods no adjustment has been made to eliminate the impact of 12b-1 payments,
and performance would have been affected had such an adjustment been made.

8
<PAGE>

CUMULATIVE TOTAL RETURN
STANDARD
CLASS A INSTITUTIONAL & POOR'S DOW JONES
SHARES CLASS** 500 INDUSTRIAL
3 months ended
11/30/94 (11.19%) (5.71%) (3.89%) (3.80%)
6 months ended
11/30/94 (7.50%) (1.68%) 0.84% 0.87%
9 months ended
11/30/94 (7.97%) (2.18%) (0.78%) (0.39%)
1 year ended
11/30/94 5.81% 0.19% 1.03% 4.28%
3 years ended
11/30/94 23.32% 31.37% 31.75% 40.71%
5 years ended
11/30/94 30.96% 39.45% 52.86% 61.65%
Period 8/27/86*
to 11/30/94 106.89% 120.30% 133.47% 159.93%

CLASS B CLASS B
SHARES SHARES
(INCLUDING (EXCLUDING
DEFERRED DEFERRED STANDARD
SALES SALES & POOR'S DOW JONES
CHARGE) CHARGE) 500 INDUSTRIAL
Period 9/6/94***
through 11/30/94 (9.13%) (5.37%) (3.89%) (3.80%)

* Date of initial public offering.
** Date of initial public offering was July 26, 1993.
*** Date of initial public offering of Class B Shares; total return for
this short of a time period may not be representative of longer-term
results.

Because every investor's goals and risk threshold are different, the
Distributor, as distributor for the Fund and other mutual funds in the
Delaware Group, will provide general information about investment
alternatives and scenarios that will allow investors to assess their personal
goals. This information will include general material about investing as well
as materials reinforcing various industry-accepted principles of prudent and
responsible personal financial planning. One typical way of addressing these
issues is to compare an individual's goals and the length of time the
individual has to attain these goals to his or her risk threshold. In
addition, the Distributor will provide information that discusses the
Manager's overriding investment philosophy and how that philosophy impacts
the Series', and other Delaware Group funds', investment disciplines employed
in meeting their objectives. The Distributor may also from time to time cite
general or specific information about the institutional clients of the
Manager, including the number of such clients serviced by the Manager.

THE POWER OF COMPOUNDING
When you opt to reinvest your current income for additional Series shares,
your investment is given yet another opportunity to grow. It's called the Power
of Compounding and the following chart illustrates just how powerful it can be.

<PAGE>

COMPOUNDED RETURNS
Results of various assumed fixed rates of return on a $10,000 investment
compounded monthly for 10 years:

9% Rate of Return 11% Rate of Return 13% Rate of Return
----------------- ------------------ ------------------

Dec. '85 $10,938 $11,157 $11,380
Dec. '86 11,964 12,448 12,951
Dec. '87 13,086 13,889 14,739
Dec. '88 14,314 15,496 16,773
Dec. '89 15,657 17,289 19,089
Dec. '90 17,126 19,289 21,723
Dec. '91 18,732 21,522 24,722
Dec. '92 20,489 24,012 28,134
Dec. '93 22,411 26,791 32,017
Dec. '94 24,514 29,891 36,437

These figures are calculated assuming a fixed constant investment return
and assume no fluctuation in the value of principal. These figures do not
reflect payment of applicable taxes, are not intended to be a projection of
investment results and do not reflect the actual performance results of any
of the Classes.

TRADING PRACTICES
AND BROKERAGE

The Fund selects brokers or dealers to execute transactions on behalf of the
Series for the purchase or sale of portfolio securities on the basis of its
judgment of their professional capability to provide the service. The primary
consideration is to have brokers or dealers execute transactions at best price
and execution. Best price and execution refers to many factors, including the
price paid or received for a security, the commission charged, the promptness
and reliability of execution, the confidentiality and placement accorded the
order and other factors affecting the overall benefit obtained by the account on
the transaction. The Fund pays reasonably competitive brokerage commission rates
based upon the professional knowledge of its trading department as to rates paid
and charged for similar transactions throughout the securities industry. In some
instances, the Fund pays a minimal share transaction cost when the transaction
presents no difficulty. Some trades are made on a net basis where the Fund
either buys securities directly from the dealer or sells them to the dealer. In
these instances, there is no direct commission charged but there is a spread
(the difference between the buy and sell price) which is the equivalent of a
commission.
During the fiscal years ended November 30, 1992, 1993 and 1994, the
aggregate dollar amounts of brokerage commissions paid by the Series were
$1,072,626, $1,600,528 and $895,815, respectively.

<PAGE>
The Manager may allocate out of all commission business generated by all of
the funds and accounts under its management, brokerage business to brokers
or dealers who provide brokerage and research services. These services
include advice, either directly or through publications or writings, as to
the value of securities, the advisability of investing in, purchasing or
selling securities, and the availability of securities or purchases or
sellers of securities; furnishing of analyses and reports concerning issuers,
securities or industries; providing information on economic factors and
trends; assisting in determining portfolio strategy; providing computer
software and hardware used in security analyses; and providing portfolio
performance evaluation and technical market analyses. Such services are used
by the Manager in connection with its investment decision-making process with
respect to one or more funds and accounts managed by it, and may not be used,
or used exclusively, with respect to the fund or account generating the
brokerage.
During the fiscal year ended November 30, 1994, portfolio transactions of the
Series in the amount of $266,710,679 resulting in brokerage commissions of
$390,266 were directed to brokers for brokerage and research services provided.
As provided in the Securities Exchange Act of 1934 and the Series'
Investment Management Agreement, higher commissions are permitted to be paid
to broker/dealers who provide brokerage and research services than to
broker/dealers who do not provide such services if such higher commissions
are deemed reasonable in relation to the value of the brokerage and research
services provided. Although transactions are directed to broker/dealers who
provide such brokerage and research services, the Fund believes that the
commissions paid to such broker/dealers are not, in general, higher than
commissions that would be paid to broker/dealers not providing such services
and that such commissions are reasonable in relation to the value of the
brokerage and research services provided. In some instances, services may be
provided to the Manager which constitute in some part brokerage and research
services used by the Manager in connection with its investment
decision-making process and constitute in some part services used by the
Manager in connection with administrative or other functions not related to
its investment decision-making process. In such cases, the Manager will make
a good faith allocation of brokerage and research services and will pay out
of its own resources for services used by the Manager in connection with
administrative or other functions not related to its investment
decision-making process. In addition, so long as no fund is disadvantaged,
portfolio transactions which generate commissions or their equivalent are
allocated to broker/dealers who provide daily portfolio pricing services to
the Fund and to other funds in the Delaware Group. Subject to best price and
execution, commissions allocated to brokers providing such pricing services
may or may not be generated by the funds receiving the pricing service.

<PAGE>

The Manager may place a combined order for two or more accounts or funds
engaged in the purchase or sale of the same security if, in its judgment,
joint execution is in the best interest of each participant and will result
in best price and execution. Transactions involving commingled orders are
allocated in a manner deemed equitable to each account or fund. When a
combined order is executed in a series of transactions at different prices,
each account participating in the order may be allocated an average price
obtained from the executing broker. It is believed that the ability of the
accounts to participate in volume transactions will generally be beneficial
to the accounts and funds. Although it is recognized that, in some cases, the
joint execution of orders could adversely affect the price or volume of the
security that a particular account or fund may obtain, it is the opinion of
the Manager and the Fund's Board of Directors that the advantages of combined
orders outweigh the possible disadvantages of separate transactions.
Consistent with the Rules of Fair Practice of the National Association of
Securities Dealers, Inc. (the "NASD"), and subject to seeking best price and
execution, the Fund may place orders with broker/dealers that have agreed to
defray certain Series expenses such as custodian fees, and may, at the
request of the Distributor, give consideration to sales of shares of the
Series as a factor in the selection of brokers and dealers to execute Series
portfolio transactions.

PORTFOLIO TURNOVER
Portfolio trading will be undertaken principally to accomplish the Series'
objective in relation to anticipated movements in the general level of
interest rates. The Series is free to dispose of portfolio securities at any
time, subject to complying with the Internal Revenue Code and the Investment
Company Act of 1940, when changes in circumstances or conditions make such a
move desirable in light of the investment objective. The Series will not
attempt to achieve or be limited to a predetermined rate of portfolio
turnover for the Series, such a turnover always being incidental to
transactions undertaken with a view to achieving the Series' investment
objective.
The degree of portfolio activity may affect brokerage costs of the Series
and taxes payable by the Series' shareholders to the extent of any net
realized capital gains. The Series' portfolio turnover rate is not expected
to exceed 100%; however, under certain market conditions the Series may
experience a high rate of portfolio turnover which could exceed 100%. The
Series' portfolio turnover rate is calculated by dividing the lesser of
purchases or sales of portfolio securities for the particular fiscal year by
the monthly average of the value of the portfolio securities owned by the
Series during the particular fiscal year, exclusive of securities whose
maturities at the time of acquisition are one year or less. A turnover rate
of 100% would occur, for example, if all the investments in the Series'
portfolio at the beginning of the year were replaced by the end of the year.

10
<PAGE>

During the fiscal years ended November 30, 1993 and 1994, the Series'
portfolio turnover rates were 119% and 74%, respectively.
In investing for capital appreciation, the Series may hold securities for
any period of time. Portfolio turnover will be increased if the Series writes
a large number of call options which are subsequently exercised. The
portfolio turnover rate also may be affected by cash requirements from
redemptions and repurchases of Series shares. Total brokerage costs generally
increase with higher portfolio turnover rates.

PURCHASING SHARES

The Distributor serves as the national distributor for the
Series' three classes of sharesthe Class A Shares, the Class B Shares and
the Institutional Class, and has agreed to use its best efforts to sell
shares of the Fund. See the PROSPECTUSES for additional information on how to
invest. Shares of the Series are offered on a continuous basis, and may be
purchased through authorized investment dealers or directly by contacting the
Fund or its agent. The minimum for initial investments with respect to the
Class A Shares is $250 and with respect to the Class B Shares is $1,000. For
any subsequent investment, the investment minimum is $25 with respect to the
Class A Shares and $100 with respect to the Class B Shares. Class B Shares
are also subject to a maximum purchase limitation of $250,000. The Fund will
therefore reject any order for purchase of more than $250,000 of Class B
Shares. (See INVESTMENT PLANS for minimums applicable to each of the Fund's
master Retirement Plans.) There are no minimum purchase requirements for the
Institutional Class, but certain eligibility requirements must be satisfied.
Selling dealers have the responsibility of transmitting orders promptly. The
Fund reserves the right to reject any order for the purchase of Series shares
if in the opinion of management such rejection is in the Series' best
interest.
Certificates representing shares purchased are not ordinarily issued unless a
shareholder submits a specific request. Certificates are not issued in the case
of the Class B Shares. However, purchases not involving the issuance of
certificates are confirmed to the investor and credited to the shareholder's
account on the books maintained by Delaware Service Company, Inc. (the "Transfer
Agent"). The investor will have the same rights of ownership with respect to
such shares as if certificates had been issued. An investor that is permitted to
obtain a certificate may receive a certificate representing shares purchased by
sending a letter to the Transfer Agent requesting the certificate. No charge is
made for any certificate issued. Investors who hold certificates representing
any of their shares may only redeem those shares by written request. The
investor's certificate(s) must accompany such request.
The NASD has adopted amendments to its Rules of Fair Practice relating to
investment company sales charges. The Fund and the Distributor intend to
operate in compliance with these rules.

<PAGE>
Class A Shares are purchased at the offering price, which reflects a
maximum front-end sales charge of 5.75%; however, lower front-end sales
charges apply for larger purchases. See the table below. Class A Shares are
also subject to annual 12b-1 Plan expenses.
Class B Shares are purchased at net asset value and are subject to a CDSC
of: (i) 4% if shares are redeemed within two years of purchase; (ii) 3% if
shares are redeemed during the third or fourth year following purchase;
(iii) 2% if shares are redeemed during the fifth year following purchase; and
(iv) 1% if shares are redeemed during the sixth year following purchase.
Class B Shares are also subject to 12b-1 Plan expenses which are higher than
those to which Class A Shares are subject and are assessed against the Class
B Shares for no longer than approximately eight years after purchase. See
AUTOMATIC CONVERSION OF CLASS B SHARES in the Fund Classes' PROSPECTUS, and
DETERMINING OFFERING PRICE AND NET ASSET VALUE and PLANS UNDER RULE 12B-1 FOR
THE FUND CLASSES in this PART B.
Institutional Class shares are purchased at the net asset value per share
without the imposition of a front-end or contingent deferred sales charge or
12b-1 Plan expenses. Institutional Class shares, Class A Shares and Class B
Shares represent a proportionate interest in the Series' assets and will
receive a proportionate interest in the Series' income, before application,
as to the Class A and Class B Shares, of any expenses under the Series' 12b-1
Plans.

ALTERNATIVE PURCHASE ARRANGEMENTS
The alternative purchase arrangements of the Class A and Class B Shares permit
investors to choose the method of purchasing shares that is most beneficial
given the amount of their purchase, the length of time they expect to hold their
shares and other relevant circumstances. Investors should determine whether,
under their particular circumstances, it is more advantageous to purchase the
Class A Shares and incur a front-end sales charge and annual 12b-1 Plan expenses
of up to a maximum of .30% of the average daily net assets of the Class A Shares
or to purchase the Class B Shares and have the entire initial purchase price
invested in the Series with the investment thereafter subject to a CDSC if
shares are redeemed within six years of purchase and annual 12b-1 Plan expenses
of 1% (.25% of which are service fees to be paid by the Fund to the Distributor,
dealers or others for providing personal service and/or maintaining shareholder
accounts) of the average daily net assets of the Class B Shares for no longer
than approximately eight years after purchase.

CLASS A SHARES
Purchases of $100,000 or more of the Class A Shares at the offering price
carry reduced front-end sales charges as shown in the accompanying table, and
may include a series of purchases over a 13-month period under a Letter of
Intention signed by a purchaser. See SPECIAL PURCHASE FEATURES--CLASS A SHARES
for more information on ways in which investors can avail themselves of
reduced front-end sales charges and other purchase features.

11
<PAGE>

* There is no front-end sales charge on purchases of $1 million or more
but, under certain limited circumstances, a 1% contingent deferred
sales charge may apply. The contingent deferred sales charge ("Limited
CDSC") that may be applicable to purchases of Class A Shares arises
only in the case of certain net asset value purchases which have triggered
the payment of a dealer's commission.
- -------------------------------------------------------------------------------
The Fund must be notified when a sale takes place which would qualify
for the reduced front-end sales charge on the basis of previous purchases and
current purchases. The reduced front-end sales charge will be granted upon
confirmation of the shareholder's holdings by the Fund. Such reduced
front-end sales charges are not retroactive.

From time to time, upon written notice to all of its dealers, the Distributor
may hold special promotions for specified periods during which the
Distributor may reallow dealers up to the full front-end sales charge shown
above. Dealers who receive 90% or more of the sales charge may be deemed to
be underwriters under the Securities Act of 1933.

**Financial institutions or their affiliated brokers may receive an agency
transaction fee in the percentages set forth above.

- -------------------------------------------------------------------------------
Certain dealers who enter into an agreement to provide extra training and
information on Delaware Group products and services and to increase sales of
Delaware Group funds may receive an additional concession of up to .15% of the
offering price in connection with sales of Class A Shares. Such dealers must
meet certain requirements in terms of organization and distribution capabilities
and their ability to increase sales. The Distributor should be contacted for
further information on these requirements as well as the basis and circumstances
upon which the additional concession will be paid. Participating dealers may be
deemed to have additional responsibilities under the securities laws.

DEALER'S COMMISSION--CLASS A SHARES
For initial purchases of Class A Shares of $1,000,000 or more made on or
after June 1, 1993, a dealer's commission may be paid by the Distributor to
financial advisers through whom such purchases are effected in accordance
with the following schedule:

DEALER'S COMMISSION
-------------------
AMOUNT OF PURCHASE (as a percentage of
------------------ amount purchased)
Up to $2 million 1.00%
Next $1 million up to $3 million .75
Next $2 million up to $5 million .50
Amount over $5 million .25

In determining a financial adviser's eligibility for the dealer's commission,
purchases of Class A Shares of other Delaware Group funds, as to which a Limited
CDSC applies (see REDEMPTION AND REPURCHASE) may be aggregated with those of the
Class A Shares of the Series. Financial advisers should contact the Distributor
concerning the applicability and calculation of the dealer's commission in the
case of combined purchases. Financial advisers also may be eligible for a
dealer's commission in connection with certain purchases made under a Letter of
Intention or pursuant to an investor's Right of Accumulation. The Distributor
also should be consulted concerning the availability of and program for these
payments.

<PAGE>

An exchange from other Delaware Group funds will not qualify for payment of
the dealer's commission, unless such exchange is from a Delaware Group fund
with assets as to which a dealer's commission or similar payment has not been
previously paid. The schedule and program for payment of the dealer's
commission are subject to change or termination at any time by the
Distributor in its discretion.

CLASS B SHARES
Class B Shares are purchased without the imposition of a front-end sales
charge at the time of purchase. Class B Shares redeemed within six years of
purchase may be subject to a CDSC at the rates set forth below, charged as a
percentage of the dollar amount subject thereto. The charge will be assessed
on an amount equal to the lesser of the net asset value at the time of
purchase of the shares being redeemed or the net asset value of the shares at
the time of redemption. Accordingly, no CDSC will be imposed on increases in
net asset value above the initial purchase price. In addition, no CDSC will
be assessed on redemption of shares received upon reinvestment of dividends
or capital gains. See the PROSPECTUS for the Fund Classes under BUYING
SHARES--CONTINGENT DEFERRED SALES CHARGE for a list of the instances in which
the CDSC is waived.
The following table sets forth the rates of the CDSC for the Class B Shares
of the Series:

CONTINGENT DEFERRED
SALES CHARGE
(AS A PERCENTAGE OF
YEAR AFTER DOLLAR AMOUNT
PURCHASE MADE SUBJECT TO CHARGE)
------------- -------------------
0-2 4%
3-4 3%
5 2%
6 1%
7 and thereafter None

During the seventh year after purchase and, thereafter, until converted
automatically into Class A Shares of the Series, the Class B Shares will
continue to be subject to annual 12b-1 Plan expenses of 1% of average daily net
assets representing such shares. At the end of no longer than approximately
eight years after purchase, the investor's Class B Shares will be automatically
converted into Class A Shares of the Series. See AUTOMATIC CONVERSION OF CLASS B
SHARES in the Fund Classes' PROSPECTUS. Such conversion will constitute a
tax-free exchange for federal income tax purposes. See TAXES in the PROSPECTUS
for the Fund Classes.

12
<PAGE>

PLANS UNDER RULE 12B-1 FOR THE FUND CLASSES
Pursuant to Rule 12b-1 under the Investment Company Act of 1940, the Fund
has adopted a separate plan for each of the Class A Shares and the Class B
Shares of the Series (the "Plans"). The Plan relating to the Class A Shares
permits the Series to pay for certain distribution, promotional and related
expenses involved in the marketing of only the Class A Shares. Similarly, the
Plan relating to the Class B Shares permits the Fund to pay for certain
distribution, promotional and related expenses involved in the marketing of
only the Class B Shares. The Plans do not apply to the Institutional Class of
shares. Such shares are not included in calculating the Plans' fees, and the
Plans are not used to assist in the distribution and marketing of the
Institutional Class shares. Shareholders of the Institutional Class may not
vote on matters affecting the Plans.
The Plans permit the Series, pursuant to an Amended and Restated
Distribution Agreement, to pay out of the assets of the Class A Shares and
Class B Shares monthly fees to the Distributor for its services and expenses
in distributing and promoting sales of shares of such classes. These expenses
include, among other things, preparing and distributing advertisements, sales
literature and prospectuses and reports used for sales purposes, compensating
sales and marketing personnel, and paying distribution and maintenance fees
to securities brokers and dealers who enter into dealer's agreements with the
Distributor. The 12b-1 Plan expenses relating to the Class B Shares are also
used to pay the Distributor for advancing the commission costs to dealers
with respect to the initial sale of such shares.
In addition, the Series may make payments out of the assets of the Class A
Shares and the Class B Shares directly to other unaffiliated parties, such as
banks, who either aid in the distribution of shares of the Fund Classes or
provide services to such classes.
The maximum aggregate fee payable by the Series under the Plans and the
agreements relating to distribution, is on an annual basis .30% of the Class A
Shares' average daily net assets for the year, and 1% (.25% of which are service
fees to be paid to the Distributor, dealers and others for providing personal
service and/or maintaining shareholder accounts) of the Class B Shares' average
daily net assets for the year. The Fund's Board of Directors may reduce these
amounts at any time.
All of the distribution expenses incurred by the Distributor and others,
such as broker/dealers, in excess of the amount paid on behalf of the Class A
and Class B Shares will be borne by such persons without any reimbursement
from such classes. Subject to seeking best price and execution, the Series
may, from time to time, buy or sell portfolio securities from or to firms
which receive payments under the Plans.
From time to time, the Distributor may pay additional amounts from its own
resources to dealers for aid in distribution or for aid in providing
administrative services to shareholders.

<PAGE>

The Plans, the Amended and Restated Distribution Agreement and the form of
dealer's and services agreements relating thereto have all been approved by the
Board of Directors of the Fund, including a majority of the directors who are
not "interested persons" (as defined in the Investment Company Act of 1940) of
the Fund and who have no direct or indirect financial interest in the Plans or
any related agreements, by vote cast in person at a meeting duly called for the
purpose of voting on the Plans and such Agreements. Continuation of the Plans,
the Amended and Restated Distribution Agreement and the form of dealer's and
services agreements must be approved annually by the Board of Directors in the
same manner as specified above.
Each year, the directors must determine whether continuation of the Plans is
in best interest of shareholders of, respectively, the Class A Shares and the
Class B Shares and that there is a reasonable likelihood of the Plan relating to
a Fund Class providing a benefit to that Class. The Plans, the Amended and
Restated Distribution Agreement and the dealer's and services agreements with
any broker/dealers or others relating to a Fund Class may be terminated at any
time without penalty by a majority of those directors who are not "interested
persons" or by a majority vote of the outstanding voting securities of the
relevant Fund Class. Any amendment materially increasing the percentage payable
under the Plans must likewise be approved by a majority vote of the outstanding
voting s ecurities of the relevant Fund Class, as well as by a majority vote of
those directors who are not "interested persons." Also, any other material
amendment to the Plans must be approved by a majority vote of the directors
including a majority of the noninterested directors of the Fund having no
interest in the Plans. In addition, in order for the Plans to remain effective,
the selection and nomination of directors who are not "interested persons" of
the Fund must be effected by the directors who themselves are not "interested
persons" and who have no direct or indirect financial interest in the Plans.
Persons authorized to make payments under the Plans must provide written reports
at least quarterly to the Board of Directors for their review.
For the fiscal year ended November 30, 1994, payments from the Class A
Shares pursuant to its Plan amounted to $1,278,668 and such amount was broken
down as follows: $31,877--Advertising; $37,614--Annual/Semi-Annual Reports;
$777,288--Broker Trails; $66,730--Commission to Wholesalers; $36,738--Dealer
Service Expenses; $214,035--Promotional-Other; $16,688--Promotional-Broker
Meetings; $25,900--Prospectus Printing; $5,611--Telephone; and $66,187--
Wholesaler Expenses.
For the period September 6, 1994 (date of initial public offering) through
November 30, 1994, payments from the Class B Shares pursuant to its Plan
amounted to $1,564 and such amount was broken down as follows: $538--Broker
Sales Charges; $376--Broker Trails; $90--Commission to Wholesalers; and
$560--Interest on Broker Sales Charges.

<PAGE>

OTHER PAYMENTS TO DEALERS--CLASS A AND CLASS B SHARES
From time to time, at the discretion of the Distributor, all registered
broker/dealers whose aggregate sales of Fund Classes exceed certain limits as
set by the Distributor, may receive from the Distributor an additional payment
of up to .25% of the dollar amount of such sales. The Distributor may also
provide additional promotional incentives or payments to dealers that sell
shares of the Delaware Group of funds. In some instances, these incentives or
payments may be offered only to certain dealers who maintain, have sold or may
sell certain amounts of shares.
In connection with the sale of Delaware Group fund shares, the Distributor
may, at its own expense, pay to participate in or reimburse dealers with whom
it has a selling agreement for expenses incurred in connection with seminars
and conferences sponsored by such dealers and may pay or allow additional
promotional incentives, which shall include non-cash concessions, such as
certain luxury merchandise or a trip to or attendance at a business seminar
at a luxury resort, in the form of sales contests to dealers who sell shares
of the funds. Such seminars and conferences and the terms of such sales
contests must be preapproved by the Distributor. Payment may be up to 100% of
the expenses incurred or awards made in connection with seminars, conferences
or contests relating to the promotion of fund shares. The Distributor may
also pay a portion of the expense of preapproved dealer advertisements
promoting the sale of Delaware Group fund shares.

SPECIAL PURCHASE FEATURES--CLASS A SHARES

BUYING AT NET ASSET VALUE
The Class A Shares may be purchased without a
front-end sales charge under the DIVIDEND REINVESTMENT PLAN and, under
certain circumstances, the 12-MONTH REINVESTMENT PRIVILEGE and the EXCHANGE
PRIVILEGE.
Officers, directors and employees (including former officers and directors
and former employees who had been employed for at least ten years) of the Fund,
any other fund in the Delaware Group, the Manager, any affiliate, any fund or
affiliate that may in the future be created, legal counsel to the funds and
registered representatives and employees of broker/dealers who have entered into
Dealer's Agreements with the Distributor may purchase Class A Shares and any
such class of shares of any of the funds in the Delaware Group, including any
fund that may be created, at the net asset value per share. Spouses, parents,
brothers, sisters and children (regardless of age) of such persons at their
direction, and any employee benefit plan established by any of the foregoing
funds, corporations, counsel or broker/dealers may also purchase shares at net
asset value. Purchases of Class A Shares may also be made by clients of
registered representatives of an authorized investment dealer at net asset value
within six months of a change of the registered representative's employment, if
the purchase is funded by proceeds from an investment where a front-end sales
charge has been assessed and the redemption of the investment did not result in
the imposition of a contingent deferred sales charge or other redemption
charges. Purchases of Class A Shares also may be made at net asset value by bank
employees that provide services in connection with agreements between the bank
and unaffiliated brokers or dealers concerning sales of Class A Shares. Also,
officers, directors and key employees of institutional clients of the Manager or
any of its affiliates may purchase Class A Shares at net asset value. Moreover,
purchases may be effected at net asset value for the benefit of the clients of
brokers, dealers and registered investment advisers affiliated with a broker or
dealer, if such broker, dealer or investment adviser has entered into an
agreement with the Distributor providing specifically for the purchase of Class
A Shares in connection with special investment products, such as wrap accounts
or similar fee based programs. Such purchasers are required to sign a letter
stating that the purchase is for investment only and that the securities may not
be resold except to the issuer. Such purchasers may also be required to sign or
deliver such other documents as the Fund may reasonably require to establish
eligibility for purchase at net asset value. The Fund must be notified in
advance that the trade qualifies for purchase at net asset value.

<PAGE>

Investments of Class A Shares made by plan level and/or participant
retirement accounts that are for the purpose of repaying a loan taken from
such accounts will be made at net asset value. Loan repayments made to a
Delaware Group account in connection with loans originated from accounts
previously maintained by another investment firm will also be invested at net
asset value.

LETTER OF INTENTION
The reduced front-end sales charges described above with respect to the Class
A Shares are also applicable to the aggregate amount of purchases made by any
such purchaser previously enumerated within a 13-month period pursuant to a
written Letter of Intention provided by the Distributor and signed by the
purchaser, and not legally binding on the signer or the Fund, which provides for
the holding in escrow by the Transfer Agent, of 5% of the total amount of Class
A Shares intended to be purchased until such purchase is completed within the
13-month period. A Letter of Intention may be dated to include shares purchased
up to 90 days prior to the date the Letter is signed. The 13-month period begins
on the date of the earliest purchase. If the intended investment is not
completed, except as noted below, the purchaser will be asked to pay an amount
equal to the difference between the front-end sales charge on the Class A Shares
purchased at the reduced rate and the front-end sales charge otherwise
applicable to the total shares purchased. If such payment is not made within 20
days following the expiration of the 13-month period, the Transfer Agent will
surrender an appropriate number of the escrowed shares for redemption in order
to realize the difference. Such purchasers may include the value (at offering
price at the level designated in their Letter of Intention) of all their shares
of the Fund and of any class of any of the other mutual funds in the Delaware
Group (except shares of any Delaware Group fund which do not carry a front-end
sales charge or contingent deferred sales charge, other than shares of Delaware
Group Premium Fund, Inc. beneficially owned in connection with the ownership of
variable insurance products, unless they were acquired through an exchange from
shares which do) previously purchased and still held as of the date of their
Letter of Intention toward the completion of such Letter. For purposes of
satisfying an investor's obligation under a Letter of Intention, Class B Shares
of the Series and the corresponding class of shares of other Delaware Group
funds which offer such shares may be aggre-gated with the Class A Shares of the
Series and the corresponding class of shares of the other Delaware Group funds.
14

<PAGE>

Employers offering a Delaware Group Retirement Plan may also complete a
Letter of Intention to obtain a reduced front-end sales charge on investments
of the Class A Shares made to the Plan. The aggregate investment level of the
Letter of Intention will be determined and accepted by the Transfer Agent at
the point of Plan establishment. The level and any reduction in front-end
sales charge will be based on actual Plan participation and the projected
investments in Delaware Group funds that are offered with a front-end sales
charge or contingent deferred sales charge for a 13-month period. The
Transfer Agent reserves the right to adjust the signed Letter of Intention
based on this acceptance criteria. The 13-month period will begin on the date
this Letter of Intention is accepted by the Transfer Agent. If actual
investments exceed the anticipated level and equal an amount that would
qualify the Plan for further discounts, any front-end sales charges will be
automatically adjusted. In the event this Letter of Intention is not
fulfilled within the 13-month period, the Plan level will be adjusted
(without completing another Letter of Intention) and the employer will be
billed for the difference in front-end sales charges due, based on the Plan's
assets under management at that time. Employers may also include the value
(at offering price at the level designated in their Letter of Intention) of
all their shares intended for purchase that are offered with a front-end
sales charge or contingent deferred sales charge of any class. Class B Shares
of the Series and other Delaware Group funds which offer a corresponding
class of shares may also be aggregated for this purpose.

COMBINED PURCHASES PRIVILEGE
In determining the availability of the reduced front-end sales charge
previously set forth with respect to the Class A Shares, purchasers may
combine the total amount of any combination of the Fund Classes of the Series
as well as any other class of any of the other Delaware Group funds (except
shares of any Delaware Group fund which do not carry a front-end sales charge
or contingent deferred sales charge, other than shares of Delaware Group
Premium Fund, Inc. beneficially owned in connection with the ownership of
variable insurance products, unless they were acquired through an exchange
from shares which do).
The privilege also extends to all purchases made at one time by an
individual; or an individual, his or her spouse and their children under the
age 21; or a trustee or other fiduciary of trust estates or fiduciary accounts
for the benefit of such family members (including certain employee benefit
programs).

<PAGE>

RIGHT OF ACCUMULATION
In determining the availability of the reduced front-end sales charge with
respect to the Class A Shares, purchasers may also combine any subsequent
purchases of the Fund Classes of the Series as well as any other class of any
of the other Delaware Group funds which offer such classes (except shares of
any Delaware Group fund which do not carry a front-end sales charge or
contingent deferred sales charge, other than shares of Delaware Group Premium
Fund, Inc. beneficially owned in connection with the ownership of variable
insurance products, unless they were acquired through an exchange from shares
which do). If, for example, any such purchaser has previously purchased and
still holds Class A Shares and/or shares of any other of the classes
described in the previous sentence with a value of $40,000 and subsequently
purchases $60,000 at offering price of additional shares of the Class A
Shares, the charge applicable to the $60,000 purchase would currently be
4.75%. For the purpose of this calculation, the shares presently held shall
be valued at the public offering price that would have been in effect were
the shares purchased simultaneously with the current purchase. Investors
should refer to the table of sales charges for Class A Shares to determine
the applicability of the Right of Accumulation to their particular
circumstances.

12-MONTH REINVESTMENT PRIVILEGE
Shareholders of the Class A Shares (and of the Institutional Class holding
shares which were acquired through an exchange of one of the other mutual
funds in the Delaware Group offered with a front-end sales charge) who redeem
such shares of the Series have one year from the redemption to reinvest all
or part of their redemption proceeds in Class A Shares or in Class A Shares
of any of the other funds in the Delaware Group, subject to applicable
eligibility and minimum purchase requirements, in states where their shares
may be sold, at net asset value without the payment of a front-end sales
charge. This privilege does not extend to Class A Shares where the redemption
of the shares triggered the payment of a Limited CDSC. Persons investing
redemption proceeds from direct investments in mutual funds in the Delaware
Group offered without a front-end sales charge will be required to pay the
applicable sales charge when purchasing Class A Shares. The reinvestment
privilege does not extend to redemption of Class B Shares.
Any such reinvestment cannot exceed the redemption proceeds (plus any
amount necessary to purchase a full share). The reinvestment will be made at
the net asset value next determined after receipt of remittance. A redemption
and reinvestment could have income tax consequences. It is recommended that a
tax adviser be consulted with respect to such transactions. Any reinvestment
directed to a fund in which the investor does not then have an account will
be treated like all other initial purchases of a fund's shares. Consequently, an
investor should obtain and read carefully the prospectus for the fund in which
the investment is proposed to be made before investing or sending money. The
prospectus contains more complete information about the fund, including charges
and expenses.

<PAGE>

Investors should consult their financial advisers or the Transfer Agent,
which also serves as the Fund's shareholder servicing agent, about the
applicability of the Limited CDSC (see CONTINGENT DEFERRED SALES CHARGE FOR
CERTAIN PURCHASES OF CLASS A SHARES MADE AT NET ASSET VALUE under REDEMPTION
AND EXCHANGE in the Fund Classes' PROSPECTUS) in connection with the features
described above.

GROUP INVESTMENT PLANS
Group Investment Plans which are not eligible to purchase shares of the
Institutional Class may also benefit from the reduced front-end sales charges
for investments in Class A Shares set forth in the table on page 12, based on
total plan assets. If a company has more than one plan investing in the
Delaware Group of funds, then the total amount invested in all plans would be
used in determining the applicable front-end sales charge reduction.
Employees participating in such Group Investment Plans may also combine the
investments made in their plan account when determining the applicable
front-end sales charge on purchases to non-retirement Delaware Group
investment accounts. For other Retirement Plans and special services, see
RETIREMENT PLANS FOR THE FUND CLASSES under INVESTMENT PLANS.

DECATUR TOTAL RETURN FUND INSTITUTIONAL CLASS
The Institutional Class is available for purchase only by: (a) retirement
plans introduced by persons not associated with brokers or dealers that are
primarily engaged in the retail securities business and rollover individual
retirement accounts from such plans; (b) tax-exempt employee benefit plans of
the Manager or its affiliates and securities dealer firms with a selling
agreement with the Distributor; (c) institutional advisory accounts of the
Manager or its affiliates and those having client relationships with Delaware
Investment Advisers, a division of the Manager, or its affiliates and their
corporate sponsors, as well as subsidiaries and related employee benefit plans
and rollover individual retirement accounts from such institutional advisory
accounts; (d) banks, trust companies and similar financial institutions
investing for their own account or for the account of their trust customers for
whom such financial institution is exercising investment discretion in
purchasing shares of the class; and (e) registered investment advisers investing
on behalf of clients that consist solely of institutions and high net-worth
individuals having at least $1,000,000 entrusted to the adviser for investment
purposes, but only if the adviser is not affiliated or associated with a broker
or dealer and derives compensation for its services exclusively from its clients
for such advisory services.
Shares of the Institutional Class are available for purchase at net asset
value, without the imposition of a front-end or contingent deferred sales
charge and are not subject to Rule 12b-1 expenses.

<PAGE>

INVESTMENT PLANS

REINVESTMENT PLAN/OPEN ACCOUNT
Unless otherwise designated by shareholders in writing, dividends from net
investment income and distributions from realized securities profits, if any,
will be automatically reinvested in additional shares of the respective Fund
Class in which an investor has an account (based on the net asset value in
effect on the reinvestment date) and will be credited to the shareholder's
account on that date. All dividends and distributions of the Institutional
Class are reinvested in the account of the holders of such shares (based on
the net asset value of the Fund in effect on the reinvestment date). A
confirmation of each dividend payment from net investment income and of
distributions from realized securities profits, if any, will be mailed to
shareholders in the first quarter of the fiscal year.
Under the Reinvestment Plan/Open Account, shareholders may purchase and add
full and fractional shares to their plan accounts at any time either through
their investment dealers or by sending a check or money order to the Series
for $25 or more with respect to the Class A Shares and $100 or more with
respect to the Class B Shares; no minimum applies to the Institutional Class.
Such purchases are made for the Class A Shares at the public offering price,
and for the Class B Shares and Institutional Class at the net asset value, at
the end of the day of receipt. A reinvestment plan may be terminated at any
time. This plan does not assure a profit nor protect against depreciation in a
declining market.

REINVESTMENT OF DIVIDENDS IN OTHER
DELAWARE GROUP FUNDS
Subject to applicable eligibility and minimum purchase requirements and the
limitations set forth below, shareholders of the Class A Shares and Class B
Shares may automatically reinvest dividends and/or distributions from the
Series in any of the other mutual funds in the Delaware Group, including the
Series, in states where their shares may be sold. Such investments will be at
net asset value at the close of business on the reinvestment date without any
front-end sales charge or service fee. The shareholder must notify the Transfer
Agent in writing and must have established an account in the fund into
which the dividends and/or distributions are to be invested. Any reinvestment
directed to a fund in which the investor does not then have an account will
be treated like all other initial purchases of a fund's shares. Consequently,
an investor should obtain and read carefully the prospectus for the fund in
which the investment is proposed to be made before investing or sending
money. The prospectus contains more complete information about the fund,
including charges and expenses. See also DIVIDEND REINVESTMENT PLAN in the
PROSPECTUS for the Fund Classes.
Subject to the following limitations, dividends and/or distributions from
other funds in the Delaware Group may be invested in shares of the Fund,
provided an account has been established. Dividends from the Class A Shares
may not be directed to the Class B Shares of another fund in the Delaware
Group. Dividends from the Class B Shares may only be directed to the Class B
Shares of another fund in the Delaware Group that offers such class of
shares. See CLASS B FUNDS in the Fund Classes' PROSPECTUS for the funds in
the Delaware Group that are eligible for investment by holders of Series
shares.

16
<PAGE>
This option is not available to participants in the following plans:
SAR/SEP, SEP/IRA, Profit Sharing and Money Purchase Pension Plans, 401(k)
Defined Contribution Plans, 403(b)(7) Deferred Compensation Plans or 457
Deferred Compensation Plans.

INVESTING BY ELECTRONIC FUND TRANSFER
DIRECT DEPOSIT PURCHASE PLAN--Investors of the Class A Shares and Class B
Shares may arrange for the Series to accept for investment, through an agent
bank, preauthorized government or private recurring payments. This method of
investment assures the timely credit to the shareholder's account of payments
such as social security, veterans' pension or compensation benefits, federal
salaries, Railroad Retirement benefits, private payroll checks, dividends,
and disability or pension fund benefits. It also eliminates lost, stolen and
delayed checks.
AUTOMATIC INVESTING PLAN--Shareholders of the Class A Shares and Class B
Shares may make automatic investments by authorizing, in advance, monthly
payments directly from their checking account for deposit into the Class.
This type of investment will be handled in either of the two ways noted
below. (1) If the shareholder's bank is a member of the National Automated
Clearing House Association ("NACHA"), the amount of the investment will be
electronically deducted from his or her account by Electronic Fund Transfer
("EFT"). The shareholder's checking account will reflect a debit each month
at a specified date although no check is required to initiate the transaction.
(2) If the shareholder's bank is not a member of NACHA, deductions will be made
by preauthorized checks, known as Depository Transfer Checks. Should the
shareholder's bank become a member of NACHA in the future, his or her
investments would be handled electronically through EFT.
This option is not available to participants in the following plans:
SAR/SEP, SEP/IRA, Profit Sharing and Money Purchase Pension Plans, 401(k)
Defined Contribution Plans, 403(b)(7) Deferred Compensation Plans or 457
Deferred Compensation Plans.

* * *
Investments under the Direct Deposit Purchase Plan and the Automatic
Investing Plan must be for $25 or more with respect to the Class A Shares and
$100 or more with respect to the Class B Shares. An investor wishing to take
advantage of either service must complete an authorization form. Either
service can be discontinued by the shareholder at any time without penalty by
giving written notice.

<PAGE>

Payments to the Series from the federal government or its agencies on
behalf of a shareholder may be credited to the shareholder's account after
such payments should have been terminated by reason of death or otherwise.
Any such payments are subject to reclamation by the federal government or its
agencies. Similarly, under certain circumstances, investments from private
sources may be subject to reclamation by the transmitting bank. In the event
of a reclamation, the Series may liquidate sufficient shares from a
shareholder's account to reimburse the government or the private source. In the
event there are insufficient shares in the shareholder's account, the
shareholder is expected to reimburse the Series.

DIRECT DEPOSIT PURCHASES BY MAIL
Shareholders may authorize a third party, such as a bank or employer, to
make investments directly to their Series accounts. The Series will accept
these investments, such as bank-by-phone, annuity payments and payroll
allotments, by mail directly from the third party. Investors should contact
their employers or financial institutions who in turn should contact the Fund
for proper instructions.

RETIREMENT PLANS FOR THE FUND CLASSES
An investment in the Series may be suitable for tax-deferred Retirement
Plans. Among the Retirement Plans noted below, Class B Shares are available
for investment only by Individual Retirement Accounts, Simplified Employee
Pension Plans, 457 Deferred Compensation Plans and 403(b)(7) Deferred
Compensation Plans. The CDSC may be waived on certain redemptions of Class B
Shares. See the PROSPECTUS for the Fund Classes under BUYING SHARES--CONTINGENT
DEFERRED SALES CHARGE for a list of the instances in which the CDSC is waived.
The minimum initial investment for each of the Retirement Plans described
below is $250; subsequent investments must be at least $25. Many of the
Retirement Plans described below are subject to one-time fees, as well as
annual maintenance fees. Prototype Profit Sharing and Money Purchase Pension
Plans are each subject to a one-time fee of $200 per plan, or $300 for paired
plans. No such fee is charged for owner-only plans. All Prototype Profit
Sharing and Money Purchase Pension Plans are subject to an annual maintenance
fee of $30 per participant account. Each of the other Retirement Plans
described below (other than 401(k) Defined Contribution Plans) is subject to
an annual maintenance fee of $15 for each participant's account, even in
years when no contributions are made, regardless of the number of funds
selected. Annual maintenance fees for 401(k) Defined Contribution Plans are
based on the number of participants in the Plan and the services selected by
the employer. Fees are quoted upon request. Annual maintenance fees may be
shared by Delaware Management Trust Company, the Transfer Agent, other
affiliates of the Manager and others that provide services to such Plans.
Fees are subject to change.
Certain shareholder investment services available to non-retirement plan
shareholders may not be available to Retirement Plan shareholders. Certain
Retirement Plans may qualify to purchase shares of the Institutional Class.
See DECATUR TOTAL RETURN FUND INSTITUTIONAL CLASS above. For additional
information on any of the Plans and Delaware's retirement services, call the
Shareholder Service Center telephone number.

<PAGE>

With respect to the annual maintenance fees per account referred to above,
"account" shall mean any account or group of accounts within a Plan type
identified by a common tax identification number between or among them.
Shareholders are responsible for notifying the Fund when more than one
account is maintained under a single tax identification number.
IT IS ADVISABLE FOR AN INVESTOR CONSIDERING ANY ONE OF THE RETIREMENT PLANS
DESCRIBED BELOW TO CONSULT WITH AN ATTORNEY, ACCOUNTANT OR A QUALIFIED
RETIREMENT PLAN CONSULTANT. FOR FURTHER DETAILS, INCLUDING APPLICATIONS FOR
ANY OF THESE PLANS, CONTACT YOUR INVESTMENT DEALER OR THE DISTRIBUTOR.
Taxable distributions from the Retirement Plans described below may be
subject to withholding.
Please contact your investment dealer or the Distributor for the special
application forms required for the Plans described below.

PROTOTYPE PROFIT SHARING OR MONEY PURCHASE PENSION PLANS
Prototype Plans are available for self-employed individuals, partnerships
and corporations which replace the former Keogh and corporate retirement
plans. These Plans contain profit sharing or money purchase pension plan
provisions. Contributions may be invested only in Class A Shares.

INDIVIDUAL RETIREMENT ACCOUNT ("IRA")
A document is available for an individual who wants to establish an
INDIVIDUAL RETIREMENT ACCOUNT ("IRA") by making contributions which may be
tax-deductible, even if the individual is already participating in an
employer-sponsored retirement plan. Even if contributions are not deductible for
tax purposes, as indicated below, earnings will be tax-deferred. In addition, an
individual may make contributions on behalf of a spouse who has no compensation
for the year or elects to be treated as having no compensation for the year.
Investments in each of the Fund Classes are permissible.
The Tax Reform Act of 1986 (the "Act") restructured, and in some cases
eliminated, the tax deductibility of IRA contributions. Under the Act, the full
deduction for IRAs ($2,000 for each working spouse and $2,250 for one-income
couples) was retained for all taxpayers who are not covered by an
employer-sponsored retirement plan. Even if a taxpayer (or his or her spouse) is
covered by an employer-sponsored retirement plan, the full deduction is still
available if the taxpayer's adjusted gross income is below $25,000 ($40,000 for
taxpayers filing joint returns). A partial deduction is allowed for married
couples with incomes between $40,000 and $50,000, and for single individuals
with incomes between $25,000 and $35,000. The Act does not permit deductions for
contributions to IRAs by taxpayers whose adjusted gross income before IRA
deductions exceeds $50,000 ($35,000 for singles) and who are active participants
in an employer-sponsored retirement plan. Taxpayers who are not allowed
deductions on IRA contributions still can make nondeductible IRA contributions
of as much as $2,000 for each working spouse ($2,250 for one-income couples),
and defer taxes on interest or other earnings from the IRAs. Special rules apply
for determining the deductibility of contributions made by married individuals
filing separate returns.

<PAGE>
A company or association may establish a Group IRA for employees or members
who want to purchase shares of the Fund. Purchases of $1 million or more of
the Class A Shares qualify for purchase at net asset value but may, under
certain circumstances, be subject to a Limited CDSC. See PURCHASING SHARES
concerning reduced front-end sales charges applicable to Class A Shares.
Investments generally must be held in the IRA until age 59 1\2 in order to
avoid premature distribution penalties, but distributions generally must
commence no later than April 1 of the calendar year following the year in which
the participant reaches age 70 1\2. Individuals are entitled to revoke the
account, for any reason and without penalty, by mailing written notice of
revocation to Delaware Management Trust Company within seven days after the
receipt of the IRA Disclosure Statement or within seven days after the
establishment of the IRA, except, if the IRA is established more than seven days
after receipt of the IRA Disclosure Statement, the account may not be revoked.
Distributions from the account (except for the pro-rata portion of any
nondeductible contributions) are fully taxable as ordinary income in the year
received. Excess contributions removed after the tax filing deadline, plus
extensions, for the year in which the excess contributions were made are subject
to a 6% excise tax on the amount of excess. Premature distributions
(distributions made before age 59 1\2, except for death, disability and certain
other limited circumstances) will be subject to a 10% excise tax on the amount
prematurely distributed, in addition to the income tax resulting from the
distribution. See CLASS B SHARES under ALTERNATIVE PURCHASE ARRANGEMENTS
concerning the applicability of a CDSC upon redemption.
See APPENDIX A for additional IRA information.

SIMPLIFIED EMPLOYEE PENSION PLAN ("SEP/IRA")
A SEP/IRA may be established by an employer who wishes to sponsor a
tax-sheltered retirement program by making contributions on behalf of all
eligible employees. Each of the Fund Classes is available for investment by
a SEP/IRA.

SALARY REDUCTION SIMPLIFIED EMPLOYEE PENSION PLAN ("SAR/SEP")
Employers with 25 or fewer eligible employees can establish this plan which
permits employer contributions and salary deferral contributions in Class A
Shares only.

PROTOTYPE 401(K) DEFINED CONTRIBUTION PLAN
Section 401(k) of the Internal Revenue Code of 1986 (the "Code") permits
employers to establish qualified plans based on salary deferral contributions.
Plan documents are available to enable employers to establish a plan. An
employer may also elect to make profit sharing contributions and/or matching
contributions with investments in only Class A Shares or certain other funds in
the Delaware Group. Purchases under the Plan may be combined for purposes of
computing the reduced front-end sales charge applicable to Class A Shares as set
forth in the table on page 12.

18
<PAGE>

DEFERRED COMPENSATION PLAN FOR PUBLIC SCHOOLS AND
NON-PROFIT ORGANIZATIONS ("403(B)(7)")
Section 403(b)(7) of the Code permits public school systems and certain
non-profit organizations to use mutual fund shares held in a custodial
account to fund deferred compensation arrangements for their employees. A
custodial account agreement is available for those employers who wish to
purchase either of the Fund Classes in conjunction with such an arrangement.
Applicable front-end sales charges with respect to Class A Shares for such
purchases are set forth in the table on page 12.

DEFERRED COMPENSATION PLAN FOR STATE AND LOCAL GOVERNMENT EMPLOYEES ("457")
Section 457 of the Code permits state and local governments, their agencies
and certain other entities to establish a deferred compensation plan for their
employees who wish to participate. This enables employees to defer a portion of
their salaries and any federal (and possibly state) taxes thereon. Such plans
may invest in shares of either of the Fund Classes. Although investors may use
their own plan, there is available a Delaware Group 457 Deferred Compensation
Plan. Interested investors should contact the Distributor or their investment
dealers to obtain further information. Applicable front-end sales charges for
such purchases of Class A Shares are set forth in the table on page 12.

DETERMINING OFFERING PRICE
AND NET ASSET VALUE

Orders for purchases of Class A Shares are effected at the offering price
next calculated by the Fund after receipt of the order by the Fund or its
agent. Orders for purchases of Class B Shares and the Institutional Class are
effected at the net asset value per share next calculated after receipt of
the order by the Fund or its agent. Selling dealers have the responsibility
of transmitting orders promptly.
The offering price for the Class A Shares consists of the net asset value per
share plus any applicable sales charges. Offering price and net asset value are
computed as of the close of regular trading on the New York Stock Exchange
(ordinarily, 4 p.m., Eastern time) on days when such exchange is open. The New
York Stock Exchange is scheduled to be open Monday through Friday throughout the
year except for New Year's Day, Presidents' Day, Good Friday, Memorial Day,
Independence Day, Labor Day, Thanksgiving and Christmas. When the New York Stock
Exchange is closed, the Fund will generally be closed, pricing calculations will
not be made and purchase and redemption orders will not be processed.

<PAGE>
An example showing how to calculate the net asset value per share and, in
the case of the Class A Shares, the offering price per share, is included in
the Series' financial statements which are incorporated by reference into
this PART B.
The Series' net asset value per share is computed by adding the value of
all the Series' securities and other assets, deducting any liabilities of the
Series, and dividing by the number of Series shares outstanding. Expenses and
fees are accrued daily. Portfolio securities, except for bonds, which are
primarily traded on a national or foreign securities exchange are valued at
the last sale price on that exchange. Options are valued at the last reported
sales price or, if no sales are reported, at the mean between bid and asked
prices. Securities not traded on a particular day, over-the-counter
securities and government and agency securities are valued at the mean value
between bid and asked prices. Money market instruments having a maturity of
less than 60 days are valued at amortized cost. Debt securities (other than
short-term obligations) are valued on the basis of valuations provided by a
pricing service when such prices are believed to reflect the fair value of
such securities. Use of a pricing service has been approved by the Board of
Directors. Subject to the foregoing, securities for which market quotations
are not readily available and other assets are valued at fair value as
determined in good faith and in a method approved by the Board of Directors.
Each Class of the Series will bear, pro-rata, all of the common expenses of
the Series. The net asset values of all outstanding shares of each Class of
the Series will be computed on a pro-rata basis for each outstanding share
based on the proportionate participation in the Series represented by the
value of shares of that Class. All income earned and expenses incurred by the
Series will be borne on a pro-rata basis by each outstanding share of a
Class, based on each Class' percentage in the Series represented by the value
of shares of such Classes, except that the Institutional Class will not incur
any of the expenses under the Series' 12b-1 Plans and shares of the Fund
Classes alone will bear the 12b-1 Plan fees payable under their respective
Plans. Due to the specific distribution expenses and other costs that will be
allocable to each Class, the net asset value of and dividends paid to each
Class of the Series will vary.
19
<PAGE>

REDEMPTION AND
REPURCHASE

Any shareholder may require the Fund to redeem Series shares by sending a
WRITTEN REQUEST, signed by the record owner or owners exactly as the shares are
registered, to the Fund, 1818 Market Street, Philadelphia, PA 19103. In
addition, certain expedited redemption methods described below are available
when stock certificates have not been issued. The Fund does not issue
certificates for Class A Shares or Institutional Class shares, unless a
shareholder specifically requests them. The Fund does not issue certificates
for Class B Shares. If stock certificates have been issued for shares being re
deemed, they must accompany the written request. For redemptions of $50,000
or less paid to the shareholder at the address of record, the Fund requires a
request signed by all owners of the shares or the investment dealer of
record, but does not require signature guarantees. When the redemption is for
more than $50,000, or if payment is made to someone else or to another
address, signatures of all record owners are required and a signature
guarantee may be required. Each signature guarantee must be supplied by an
eligible guarantor institution. The Fund reserves the right to reject a
signature guarantee supplied by an eligible institution based on its
creditworthiness. The Fund may request further documentation from corporations,
retirement plans, executors, administrators, trustees or guardians.
In addition to redemption of Series shares by the Fund, the Distributor,
acting as agent of the Fund, offers to repurchase Series shares from
broker/dealers acting on behalf of shareholders. The redemption or repurchase
price, which may be more or less than the shareholder's cost, is the net
asset value per share next determined after receipt of the request in good
order by the Fund or its agent, less any applicable contingent deferred sales
charge. This is computed and effective at the time the offering price and net
asset value are determined. See DETERMINING OFFERING PRICE AND NET ASSET
VALUE. The Fund and the Distributor end their business day at 5 p.m., Eastern
time. This offer is discretionary and may be completely withdrawn without
further notice by the Distributor.
Orders for the repurchase of Series shares which are submitted to the
Distributor prior to the close of its business day will be executed at the
net asset value per share computed that day (less any applicable contingent
deferred sales charge), if the repurchase order was received by the
broker/dealer from the shareholder prior to the time the offering price and
net asset value are determined on such day. The selling dealer has the
responsibility of transmitting orders to the Distributor promptly. Such
repurchase is then settled as an ordinary transaction with the broker/dealer
(who may make a charge to the shareholder for this service) delivering the
shares repurchased.

<PAGE>
Certain redemptions of Class A Shares purchased at net asset value may
result in the imposition of a Limited CDSC. See CONTINGENT DEFERRED SALES
CHARGE FOR CERTAIN PURCHASES OF CLASS A SHARES MADE AT NET ASSET VALUE under
REDEMPTION AND EXCHANGE in the Series' PROSPECTUS for the Fund Classes. The
Class B Shares are subject to a CDSC of: (i) 4% if shares are redeemed within
two years of purchase; (ii) 3% if shares are redeemed during the third or
fourth year following purchase; (iii) 2% if shares are redeemed during the
fifth year following purchase; and (iv) 1% if shares are redeemed during the
sixth year following purchase. See CONTINGENT DEFERRED SALES CHARGE under
BUYING SHARES in the Series' PROSPECTUS for the Fund Classes. Except for such
contingent deferred sales charges and, with respect to the expedited payment
by wire described below, for which there is currently a $7.50 bank wiring
cost, neither the Fund nor the Distributor charges a fee for redemptions or
repurchases, but such fees could be charged at any time in the future.
Payment for shares redeemed will ordinarily be mailed the next business
day, but in no case later than seven days, after receipt of a redemption
request in good order.
If a shareholder who recently purchased shares by check seeks to redeem all
or a portion of those shares in a written request, the Fund will honor the
redemption request but will not mail the proceeds until it is reasonably
satisfied of the collection of the investment check. This potential delay can
be avoided by making investments by wiring Federal Funds.
If a shareholder has been credited with a purchase by a check which is
subsequently returned unpaid for insufficient funds or for any other reason,
the Fund will automatically redeem from the shareholder's account the Series
shares purchased by the check plus any dividends earned thereon. Shareholders
may be responsible for any losses to the Series or to the Distributor.
In case of a suspension of the determination of the net asset value because
the New York Stock Exchange is closed for other than weekends or holidays, or
trading thereon is restricted or an emergency exists as a result of which
disposal by the Series of securities owned by it is not reasonably practical,
or it is not reasonably practical for the Series fairly to value its assets,
or in the event that the Securities and Exchange Commission has provided for
such suspension for the protection of shareholders, the Series may postpone
payment or suspend the right of redemption or repurchase. In such case, the
shareholder may withdraw the request for redemption or leave it standing as a
request for redemption at the net asset value next determined after the
suspension has been terminated.
Payment for shares redeemed or repurchased may be made either in cash or
kind, or partly in cash and partly in kind. Any portfolio securities paid or
distributed in kind would be valued as described in DETERMINING OFFERING
PRICE AND NET ASSET VALUE. Subsequent sale by an investor receiving a
distribution in kind could result in the payment of brokerage commissions.
However, the Fund has elected to be governed by Rule 18f-1 under the
Investment Company Act of 1940 pursuant to which the Fund is obligated to
redeem Series shares solely in cash up to the lesser of $250,000 or 1% of the
net asset value of the Series during any 90-day period for any one
shareholder.

20
<PAGE>

The value of the Series' investments is subject to changing market prices.
Thus, a shareholder reselling shares to the Series may sustain either a gain
or loss, depending upon the price paid and the price received for such
shares.

SMALL ACCOUNTS
Due to the relatively higher costs of maintaining small accounts, the Fund
reserves the right to redeem Series shares in any of its accounts at the
then-current net asset value if the total investment in the Series has a
value of less than $250 as a result of redemptions. As a consequence, an
investor who makes only the minimum investment in a Class will be subject to
involuntary redemption if any portion of the investment is redeemed. Before
the Fund redeems such shares and sends the proceeds to the shareholder, the
shareholder will be notified in writing that the value of the shares in the
account is less than $250 and will be allowed 60 days from that date of
notice to make an additional investment to meet the required minimum of $250.
Any redemption in an inactive account established with a minimum investment
may trigger mandatory redemption. No contingent deferred sales charge will
apply to the redemptions described in this paragraph of the Class A and the
Class B Shares.

EXPEDITED TELEPHONE REDEMPTIONS
The Fund has available certain redemption privileges, as described below.
The Fund reserves the right to suspend or terminate the expedited payment
procedures upon 60 days' written notice to shareholders.
Shareholders of the Fund Classes or their investment dealers of record
wishing to redeem any amount of shares of $50,000 or less for which
certificates have not been issued may call the Fund at 800-523-1918 (in
Philadelphia, 988-1241) or, in the case of shareholders of the Institutional
Class, their Client Services Representative at 800-828-5052 prior to the time
the offering price and net asset value are determined, as noted above, and
have the proceeds mailed to them at the record address. Checks payable to the
shareholder(s) of record will normally be mailed the next business day, but
no later than seven days, after the receipt of the redemption request. This
option is only available to individual, joint and individual fiduciary-type
accounts.
In addition, redemption proceeds of $1,000 or more can be transferred to
your predesignated bank account by wire or by check by calling the Fund, as
described above. An authorization form must have been completed by the
shareholder and filed with the Fund BEFORE the request is received. Payment
will be made by wire or check to the bank account designated on the
authorization form as follows:
1. PAYMENT BY WIRE: Request that Federal Funds be wired to the bank account
designated on the authorization form. Redemption proceeds will normally be
wired on the next business day following receipt of the redemption request.
There is a $7.50 wiring fee (subject to change) charged by CoreStates Bank,
N.A. which will be deducted from the withdrawal proceeds each time the
shareholder requests a redemption. If the proceeds are wired to the
shareholder's account at a bank which is not a member of the Federal Reserve
System, there could be a delay in the crediting of the funds to the
shareholder's bank account.

<PAGE>
2. PAYMENT BY CHECK: Request a check be mailed to the bank account
designated on the authorization form. Redemption proceeds will normally be
mailed the next business day, but no more than seven days, from the date of
the telephone request. This procedure will take longer than the PAYMENT BY
WIRE option (1 above) because of the extra time necessary for the mailing and
clearing of the check after the bank receives it.
REDEMPTION REQUIREMENTS: In order to change the name of the bank and the
account number it will be necessary to send a written request to the Fund and
a signature guarantee may be required. Each signature guarantee must be
supplied by an eligible guarantor institution. The Fund reserves the right to
reject a signature guarantee supplied by an eligible institution based on its
creditworthiness.
To reduce the shareholder's risk of attempted fraudulent use of the
telephone redemption procedure, payment will be made only to the bank account
designated on the authorization form.
The Fund will not honor telephone redemptions for Series shares recently
purchased by check unless it is reasonably satisfied that the purchase check
has cleared.
If expedited payment under these procedures could adversely affect the
Series, the Fund may take up to seven days to pay the shareholder.
Neither the Fund nor the Transfer Agent is responsible for any shareholder
loss incurred in acting upon written or telephone instructions for redemption
or exchange of Series shares which are reasonably believed to be genuine.
With respect to such telephone transactions, the Fund will follow reasonable
procedures to confirm that instructions communicated by telephone are genuine
(including verification of a form of personal identification) as, if it does
not, the Fund or the Transfer Agent may be liable for any losses due to
unauthorized or fraudulent transactions. Telephone instructions received by
shareholders of the Fund Classes are generally tape recorded. A written
confirmation will be provided for all purchase, exchange and redemption
transactions initiated by telephone.

SYSTEMATIC WITHDRAWAL PLAN
Shareholders of the Class A Shares who own or purchase $5,000 or more of
shares at the offering price for which certificates have not been issued may
establish a Systematic Withdrawal Plan for monthly withdrawals of $25 or
more, or quarterly withdrawals of $75 or more, although the Series does not
recommend any specific amount of withdrawal. This $5,000 minimum does not
apply for the Series' prototype Retirement Plans. Shares purchased with the
initial investment and through reinvestment of cash dividends and realized
securities profits distributions will be credited to the shareholder's
account and sufficient full and fractional shares will be redeemed at the net
asset value calculated on the third business day preceding the mailing date.

<PAGE>

Checks are dated the 20th of the month (unless such date falls on a holiday
or a Sunday) and mailed on or about the 19th of every month. Both ordinary
income dividends and realized securities profits distributions will be
automatically reinvested in additional shares of the Class at net asset
value. This plan is not recommended for all investors and should be started
only after careful consideration of its operation and effect upon the
investor's savings and investment program. To the extent that withdrawal
payments from the plan exceed any dividends and/or realized securities
profits distributions paid on shares held under the plan, the withdrawal
payments will represent a return of capital, and the share balance may in
time be depleted, particularly in a declining market.
The sale of shares for withdrawal payments constitutes a taxable event and
a shareholder may incur a capital gain or loss for federal income tax
purposes. This gain or loss may be long-term or short-term depending on the
holding period for the specific shares liquidated. Premature withdrawals from
Retirement Plans may have adverse tax consequences.
Withdrawals under this plan by the holders of Class A Shares or any similar
plan of any other investment company charging a front-end sales charge made
concurrently with the purchases of the Class A Shares of this or the shares
of any other investment company will ordinarily be disadvantageous to the
shareholder because of the payment of duplicative sales charges. Shareholders
should not purchase Class A Shares while participating in a Systematic
Withdrawal Plan and a periodic investment program in a fund managed by the
Manager must be terminated before a Systematic Withdrawal Plan can take
effect, except if the shareholder is a participant in one of our Retirement
Plans or is investing in Delaware Group funds which do not carry a sales
charge. Also, redemptions pursuant to a Systematic Withdrawal Plan may be
subject to a Limited CDSC if the purchase was made at net asset value and a
dealer's commission has been paid on that purchase.
An investor wishing to start a Systematic Withdrawal Plan must complete an
authorization form. If the recipient of Systematic Withdrawal Plan payments
is other than the registered shareholder, the shareholder's signature on this
authorization must be guaranteed. Each signature guarantee must be supplied
by an eligible guarantor institution. The Fund reserves the right to reject a
signature guarantee supplied by an eligible institution based on its
creditworthiness. This plan may be terminated by the shareholder or the
Transfer Agent at any time by giving written notice.
The Systematic Withdrawal Plan is not available with respect to the Class B
Shares or the Institutional Class.

WEALTH BUILDER OPTION
Shareholders of the Fund Classes may elect to invest in one or more of the
other mutual funds in the Delaware Group through our Wealth Builder Option.
Under this automatic exchange program, shareholders can authorize regular
monthly investments (minimum of $100 per fund) to be liquidated from their
account and invested automatically into other mutual funds in the Delaware
Group, subject to the conditions and limitations set forth in the Fund Classes'
PROSPECTUS. See WEALTH BUILDER OPTION and REDEMPTION AND EXCHANGE in the
PROSPECTUS for the Fund Classes.

<PAGE>

The investment will be made on the 20th day of each month (or, if the fund
selected is not open that day, the next business day) at the public offering
price or net asset value, as applicable, of the fund selected on the date of
investment. No investment will be made for any month if the value of the
shareholder's account is less than the amount specified for investment.
Periodic investment through the Wealth Builder Option does not insure
profits or protect against losses in a declining market. The price of the
fund into which investments are made could fluctuate. Since this program
involves continuous investment regardless of such fluctuating value,
investors selecting this option should consider their financial ability to
continue to participate in the program through periods of low fund share
prices. This program involves automatic exchanges between two or more fund
accounts and is treated as a purchase of shares of the fund into which
investments are made through the program. See EXCHANGE PRIVILEGE for a brief
summary of the tax consequences of exchanges.
Shareholders can also use the Wealth Builder Option to invest in the Fund
Classes through regular liquidations of shares in their accounts in other
mutual funds in the Delaware Group, subject to the conditions and limitations
described in the Fund Classes' PROSPECTUS. Shareholders can terminate their
participation at any time by written notice to the Fund.
This option is not available to participants in the following plans:
SAR/SEP, SEP/IRA, Profit Sharing and Money Purchase Pension Plans, 401(k)
Defined Contribution Plans, 403(b)(7) Deferred Compensation Plans or 457
Deferred Compensation Plans. This option also is not available to
shareholders of the Institutional Class.

DISTRIBUTIONS AND TAXES

The Series has qualified, and intends to continue to qualify as a regulated
investment company under Subchapter M of the Internal Revenue Code of 1986,
as amended. As such, the Series will not be subject to federal income tax on
net investment income and net realized capital gains which are distributed to
shareholders.
The Series intends to pay out all of its net investment income on a
quarterly basis. Distributions of net capital gains, if any, realized on
sales of investments will be distributed annually during the quarter
following the close of the fiscal year.
All dividends and any capital gains distributions will be automatically
credited to the shareholder's account in additional shares of the same class
unless, in the case of shareholders in the Fund Classes, the shareholder
requests in writing that such dividends and/or distributions be paid in cash.
Dividend payments of $1.00 or less will be automatically reinvested,
notwithstanding a shareholder's election to receive dividends in cash. If such
a shareholder's dividends increase to greater than $1.00, the shareholder would
have to file a new election in order to begin receiving dividends in cash
again.

<PAGE>
Each Class of shares of the Series will share proportionately in the
investment income and expenses of the Series, except that the Class A Shares
and the Class B Shares alone will incur distribution fees under their
respective 12b-1 Plans.
Any check in payment of dividends or other distributions which cannot be
delivered by the Post Office or which remains uncashed for a period of more
than one year may be reinvested in the shareholder's account at the
then-current net asset value and the dividend option may be changed from cash
to reinvest. The Series may deduct from a shareholder's account the costs of
the Series' effort to locate a shareholder if a shareholder's mail is
returned by the Post Office or the Series is otherwise unable to locate the
shareholder or verify the shareholder's mailing address. These costs may
include a percentage of the account when a search company charges a
percentage fee in exchange for their location services. See also OTHER TAX
REQUIREMENTS under ACCOUNTING AND TAX ISSUES.
During the fiscal year ended November 30, 1994, dividends totaling $0.43,
$0.10 and $0.45 per share of the Class A Shares, the Class B Shares and the
Institutional Class, respectively, were paid from net investment income. The
Class A Shares and the Institutional Class also paid a capital gain of $1.66
per share from realized securities profits during the fiscal year ended
November 30, 1994. Dividends of $0.10, $0.09 and $0.14 per share of the Class
A Shares, the Class B Shares and the Institutional Class, respectively, were
paid from net investment income and a capital gain of $0.42 per share of each
Class was paid from realized securities profits on January 5, 1995 to
shareholders of record December 27, 1994.
Persons not subject to tax will not be required to pay taxes on
distributions.
Dividends from investment income and short-term capital gains distributions
are treated by shareholders as ordinary income for federal income tax
purposes, whether received in cash or in additional shares. Distributions of
long-term capital gains, if any, are taxable to shareholders as long-term
capital gains, regardless of the length of time an investor has held such
shares, and these gains are currently taxed at long-term capital gain rates.
Under the Tax Reform Act of 1986, each Series of the Fund is treated as a
single tax entity and capital gains and losses for each Series are calculated
separately.
A portion of the Series' dividends may qualify for the dividends-received
deduction for corporations provided in the federal income tax law. The
portion of dividends paid by the Series that so qualifies will be designated
each year in a notice mailed to the Series' shareholders, and cannot exceed
the gross amount of dividends received by the Series from domestic (U.S.)
corporations that would have qualified for the dividends-received deduction
in the hands of the Series if the Series was a regular corporation. The
availability of the dividends-received deduction is subject to certain holding
period and debt financing restrictions imposed under the Code on the corporation
claiming the deduction. For the fiscal year ended November 30, 1994, 100% of the
dividends from net investment income of the Series were eligible for this
deduction.

<PAGE>

Shareholders will be notified annually by the Fund as to the federal income
tax status of dividends and distributions paid by the Series.

INVESTMENT MANAGEMENT
AGREEMENT

The Manager, located at One Commerce Square, Philadelphia, PA 19103, furnishes
investment management services to the Series, subject to the supervision and
direction of the Fund's Board of Directors.
The Manager and its predecessors have been managing the funds in the
Delaware Group since 1938. The aggregate assets of these funds on November
30, 1994 were approximately $9,237,192,000. Investment advisory services are
also provided to institutional accounts with assets on November 30, 1994 of
approximately $15,544,258,000.
The Investment Management Agreement for the Series, dated June 29, 1988,
was approved by shareholders on June 14, 1988, and renewed for a period of an
additional year by the Board of Directors at a meeting held on January 28,
1995.
The Agreement may be renewed each year only so long as such renewal and
continuance are specifically approved at least annually by the Board of
Directors or by vote of a majority of the outstanding voting securities of
the Series, and only if the terms and the renewal thereof have been approved
by the vote of a majority of the directors of the Fund who are not parties
thereto or interested persons of any such party, cast in person at a meeting
called for the purpose of voting on such approval. The Agreement is
terminable without penalty on 60 days' notice by the directors of the Fund or
by the Manager. The Agreement will terminate automatically in the event of
its assignment.

The annual compensation paid by the Series for investment management services
is equal to .60% on the first $500 million of the Series' average daily net
assets, .575% on the next $250 million and .55% on the average daily net assets
in excess of $750 million, less all directors' fees paid to the unaffiliated
directors by the Series.
On November 30, 1994, the total net assets of the Series were $405,963,326.
Investment management fees paid by the Series during the past three fiscal years
were $2,425,145 for 1992, $2,567,182 for 1993 and $2,542,011 for 1994.
Under the general supervision of the Board of Directors, the Manager makes all
investment decisions which are implemented by the Fund. The Manager pays the
salaries of all directors, officers and employees of the Fund who are affiliated
with the Manager. The Series pays all of its other expenses, including its
proportionate share of rent and certain other administrative expenses.

23
<PAGE>

The ratio of expenses to average daily net assets for the Decatur Total
Return Fund A Class and for the Decatur Total Return Fund Institutional Class
for the fiscal year ended November 30, 1994 was 1.26% and 0.96%,
respectively. Based on expenses incurred by the Class A Shares during its
fiscal year ended November 30, 1994, the expenses of the Class B Shares are
expected to be 1.96% for the fiscal year ending November 30, 1995. The
expense ratio for the Class A Shares and the Class B Shares reflects the
impact of its respective 12b-1 Plan.
By California regulation, the Manager is required to waive certain fees and
reimburse the Series for certain expenses to the extent that the Series'
annual operating expenses, exclusive of taxes, interest, brokerage
commissions and extraordinary expenses, exceed 2 1/2% of the first $30 million
of average daily net assets, 2% of the next $70 million of average daily net
assets and 1 1/2% of any additional average daily net assets. For the fiscal
year ended November 30, 1994, no such reimbursement was necessary or paid.

DISTRIBUTION AND SERVICE
The Distributor, Delaware Distributors, L.P. (which formerly conducted
business as Delaware Distributors, Inc.), located at 1818 Market Street,
Philadelphia, PA 19103, serves as the national distributor of Series shares
under an Amended and Restated Distribution Agreement dated as of September 6,
1994. The Distributor is an affiliate of the Manager and bears all of the
costs of promotion and distribution, except for payments by the Series on
behalf of the Class A Shares and Class B Shares of the Series under their
respective 12b-1 Plans. Prior to January 3, 1995, Delaware Distributors, Inc.
("DDI") served as the national distributor of the Series' shares. On that date
Delaware Distributors, L.P., a newly formed limited partnership, succeeded to
the business of DDI. All officers and employees of DDI became officers and
employees of Delaware Distributors, L.P. DDI is the corporate general partner of
Delaware Distributors, L.P. and both DDI and Delaware Distributors, L.P. are
indirect, wholly-owned subsidiaries of Delaware Management Holdings, Inc.
The Transfer Agent, Delaware Service Company, Inc., another affiliate of
the Manager located at 1818 Market Street, Philadelphia, PA 19103, serves as
the Series' shareholder servicing, dividend disbursing and transfer agent
pursuant to a Shareholders Services Agreement dated June 29, 1988. The
Transfer Agent is also an indirect, wholly-owned subsidiary of Delaware
Management Holdings, Inc.
<PAGE>

OFFICERS AND DIRECTORS

The business and affairs of the Fund are managed under the direction of its
Board of Directors.
Certain officers and directors of the Fund hold identical positions in each
of the other funds in the Delaware Group. On December 31, 1994, the Fund's
officers and directors owned less than 1% of the Series' shares outstanding.
As of December 31, 1994, the Fund believes Merrill Lynch, Pierce Fenner &
Smith, Mutual Fund Operations, 4800 Deer Lake Dr. East, 3rd Fl.,
Jacksonville, FL 32246 held of record 12,064 shares (6.68%) of the
outstanding shares of the Class B Shares.
As of the same date, the Fund believes First Trust NA, Trst Northern States
Power Employee Retirement Savings Plan, Mutual Funds A/C 21736111, P.O. Box
64482, St. Paul, MN 55164 held 384,551 shares (76.63%) of the outstanding shares
of the Institutional Class. Delaware Management Company Employee Profit Sharing
Trust, 1818 Market Street, Philadelphia, PA 19103 held 39,197 shares (7.81%) and
Morton's of Chicago Inc., 350 West Hubbard Street, Suite 350, Chicago, IL 60610
held 26,780 shares (5.33%) of the outstanding shares of the Institutional Class.
Shares held of record by the above mentioned were believed to be beneficially
owned by others. Castle Harlan, Inc. 401(k) Plan, for the benefit of John K.
Castle, 150 East 58th Street, New York, NY 10155 held 30,501 shares (6.08%) of
the outstanding shares of the Institutional Class. Castle Harlan, Inc. 401(k)
Plan was the record owner of 48,857 shares (9.73%) of the outstanding shares,
which include those beneficially owned by the shareholder named in the previous
sentence.
DMH Corp., Delaware Management Company, Inc., Delaware Distributors, L.P.,
Delaware Distributors, Inc., Delaware Service Company, Inc., Delaware
Management Trust Company, Delaware International Holdings Ltd., Founders
Holdings, Inc., Delaware International Advisers Ltd. and Delaware Investment
Counselors, Inc. are direct or indirect, wholly-owned subsidiaries of
Delaware Management Holdings, Inc. ("DMH"). By reason of its percentage
ownership of DMH common stock and through a Voting Trust Agreement with
certain other DMH shareholders, Legend Capital Group, L.P. ("Legend")
controls DMH and its direct and indirect, wholly-owned subsidiaries. As
General Partners of Legend, Leonard M. Harlan and John K. Castle have the
ability to direct the voting of more than a majority of the shares of DMH and
thereby control DMH and its direct and indirect, wholly-owned subsidiaries.
24
<PAGE>

On December 12, 1994, DMH entered into a merger agreement with Lincoln
National Corporation ("Lincoln National") and a newly-formed subsidiary of
Lincoln National. Pursuant to that agreement, the new subsidiary will be merged
with and into DMH. This merger will result in DMH becoming a wholly-owned
subsidiary of Lincoln National. The transaction is expected to close in the
early spring of 1995, subject to the receipt of all regulatory approvals and
satisfaction of conditions precedent to closing. See MANAGEMENT OF THE FUND in
the PROSPECTUSES for more information regarding this merger transaction.
Directors and principal officers of the Fund are noted below along with their
ages and their business experience for the past five years. Unless otherwise
noted, the address of each officer and director is One Commerce Square,
Philadelphia, PA 19103.

*WAYNE A. STORK (57)
CHAIRMAN, DIRECTOR AND/OR TRUSTEE of the Fund and each
of the other 16 Funds in the Delaware Group.
CHAIRMAN, CHIEF EXECUTIVE OFFICER, CHIEF INVESTMENT OFFICER
AND DIRECTOR of Delaware Management Company, Inc.
CHAIRMAN, PRESIDENT, CHIEF EXECUTIVE OFFICER AND DIRECTOR
of Delaware International Holdings Ltd.
CHAIRMAN, CHIEF EXECUTIVE OFFICER AND DIRECTOR of Delaware
Management Holdings, Inc., DMH Corp., Delaware
International Advisers Ltd. and Founders Holdings, Inc.
CHAIRMAN AND DIRECTOR of Delaware Management Trust
Company.
DIRECTOR of Delaware Distributors, Inc., Delaware
Service Company, Inc. and Delaware Investment
Counselors, Inc.
During the past five years, Mr. Stork has served in
various executive capacities at different times within
the Delaware organization.

*BRIAN F. WRUBLE (51)
PRESIDENT, CHIEF EXECUTIVE OFFICER, DIRECTOR AND/OR TRUSTEE
of the Fund and 15 other Funds in the Delaware
Group (which excludes Delaware Pooled Trust, Inc.).
DIRECTOR of Delaware Pooled Trust, Inc., Delaware
International Advisers Ltd. and Delaware Investment
Counselors, Inc.
PRESIDENT, CHIEF OPERATING OFFICER AND DIRECTOR of Delaware
Management Holdings, Inc., DMH Corp. and
Delaware Management Company, Inc.
CHAIRMAN, CHIEF EXECUTIVE OFFICER AND DIRECTOR of Delaware
Service Company, Inc.
CHAIRMAN AND DIRECTOR of Delaware Distributors, Inc.
CHAIRMAN of Delaware Distributors, L.P.
PRESIDENT of Founders Holdings, Inc.
Before joining the Delaware Group in 1992, Mr. Wruble
was Chairman, President and Chief Executive Officer
of Equitable Capital Management Corporation and
Executive Vice President and Chief Investment
Officer of Equitable Life Assurance Society of the
United States. Mr. Wruble has previously held execu-
tive positions with Smith Barney, Harris Upham and
H.C. Wainwright & Co.
- -----------
* Director affiliated with the investment manager of the Fund and considered
and "interested person" as defined in the Investment Company Act of 1940.

<PAGE>

WINTHROP S. JESSUP (49)
EXECUTIVE VICE PRESIDENT of the Fund and 15 other Funds
in the Delaware Group (which excludes Delaware
Pooled Trust, Inc.).
PRESIDENT AND CHIEF EXECUTIVE OFFICER of Delaware Pooled
Trust, Inc.
PRESIDENT AND DIRECTOR of Delaware Investment
Counselors, Inc.
EXECUTIVE VICE PRESIDENT AND DIRECTOR of Delaware Manage-
ment Holdings, Inc., DMH Corp., Delaware Manage-
ment Company, Inc., Delaware Management Trust
Company, Delaware International Holdings Ltd. and
Founders Holdings, Inc.
VICE CHAIRMAN AND DIRECTOR of Delaware Distributors, Inc.
VICE CHAIRMAN of Delaware Distributors, L.P.
DIRECTOR of Delaware Service Company, Inc. and
Delaware International Advisers Ltd.
During the past five years, Mr. Jessup has served in
various executive capacities at different times within
the Delaware organization.

RICHARD G. UNRUH, JR. (55)
EXECUTIVE VICE PRESIDENT of the Fund and each of the
other 16 Funds in the Delaware Group.
EXECUTIVE VICE PRESIDENT AND DIRECTOR of Delaware
Management Company, Inc.
SENIOR VICE PRESIDENT of Delaware Management Hold-
ings, Inc.
During the past five years, Mr. Unruh has served in
various executive capacities at different times
within the Delaware organization.

WALTER P. BABICH (67)
DIRECTOR AND/OR TRUSTEE of the Fund and each of the other
16 Funds in the Delaware Group.
460 North Gulph Road, King of Prussia, PA 19406.
BOARD CHAIRMAN, Citadel Constructors, Inc.
From 1986 to 1988, Mr. Babich was a partner of Irwin &
Leighton and from 1988 to 1991, he was a partner of
I&L Investors.

25
<PAGE>

*JOHN K. CASTLE (54)
DIRECTOR AND/OR TRUSTEE of the Fund, each of the other
16 Funds in the Delaware Group and Delaware
Management Holdings, Inc.
150 East 58th Street, New York, NY 10155.
GENERAL PARTNER, Legend Capital Group, L.P.
CHAIRMAN, Castle Harlan, Inc., a private merchant bank
in New York City.
CHAIRMAN, Castle Harlan Partners II GP, Inc.
PRESIDENT AND CHIEF EXECUTIVE OFFICER, Branford Castle, Inc.,
an investment holding company.
CHAIRMAN, Castle Connolly Medical Ltd.
DIRECTOR, Sealed Air Corp.
DIRECTOR, UNC, Inc.
DIRECTOR, Quantum Restaurant Group, Inc.
DIRECTOR, INDSPEC Chemical Corporation.
DIRECTOR, Truck Components, Inc.
TRUSTEE, New York Medical College.
Immediately prior to forming Branford Castle, Inc. in
1986, Mr. Castle was President and Chief Executive
Officer and a director of Donaldson, Lufkin & Jenrette,
which he joined in 1965. Mr. Castle also served as
Chairman of the Board of the New York Medical
College for 11 years and has served as a director of the
Equitable Life Assurance Society of the United States
and as a member of the Corporation of the
Massachusetts Institute of Technology.

*LEONARD M. HARLAN (58)
DIRECTOR AND/OR TRUSTEE of the Fund, each of the other
16 Funds in the Delaware Group and Delaware
Management Holdings, Inc.
150 East 58th Street, New York, NY 10155.
GENERAL PARTNER, Legend Capital Group, L.P.
PRESIDENT, Castle Harlan, Inc., a private merchant bank
in New York City.
PRESIDENT, Castle Harlan Partners IIGP, Inc.
CHAIRMAN AND CHIEF EXECUTIVE OFFICER, The Harlan
Company, Inc.
DIRECTOR, Long John Silver's Holdings, Inc.
DIRECTOR, The Ryland Group, Inc.
DIRECTOR, SmarteCarte, Inc.
DIRECTOR, MAG Aerospace Industries, Inc.
DIRECTOR, Strawberries, Inc.
TRUSTEE, North Country School/CTT.
TRUSTEE, New York City Citizens Budget Commission.
MEMBER, Visiting Committee of the Harvard Business
School.

- -----------
* Director affiliated with the investment manager of the Fund and considered
and "interested person" as defined in the Investment Company Act of 1940.

<PAGE>

ANTHONY D. KNERR (56)
DIRECTOR AND/OR TRUSTEE of the Fund and each of the other
16 Funds in the Delaware Group.
500 Fifth Avenue, New York, NY 10110.
CONSULTANT, Anthony Knerr & Associates.
From 1982 to 1988, Mr. Knerr was Executive Vice
President/Finance and Treasurer of Columbia
University, New York. From 1987 to 1989, he was
also a lecturer in English at the University. In addition,
Mr. Knerr was Chairman of The Publishing Group,
Inc., New York, from 1988 to 1990. Mr. Knerr founded
The Publishing Group, Inc. in 1988.

ANN R. LEVEN (54)
DIRECTOR AND/OR TRUSTEE of the Fund and each of the other
16 Funds in the Delaware Group.
785 Park Avenue, New York, NY 10021.
TREASURER, National Gallery of Art.
From 1984 to 1990. Ms. Leven was Treasurer and Chief
Fiscal Officer of the Smithsonian Institution,
Washington, DC., and from 1975 to 1994, she was
Adjunct Professor of Columbia Business School.

W. THACHER LONGSTRETH (74)
DIRECTOR AND/OR TRUSTEE of the Fund and each of the other
16 Funds in the Delaware Group.
1617 John F. Kennedy Boulevard, Philadelphia, PA 19103.
VICE CHAIRMAN, Packard Press, a financial printing,
commercial printing and information processing firm.
PHILADELPHIA CITY COUNCILMAN.

CHARLES E. PECK (69)
DIRECTOR AND/OR TRUSTEE of the Fund and each of the other
16 Funds in the Delaware Group.
P.O. Box 1102, Columbia, MD 21044.
RETIRED.
From 1981 to 1990, Mr. Peck was Chairman and Chief
Executive Officer of The Ryland Group, Inc.,
Columbia, MD.
26
<PAGE>

DAVID K. DOWNES (55)
SENIOR VICE PRESIDENT/CHIEF ADMINISTRATIVE OFFICER/CHIEF
FINANCIAL OFFICER of the Fund, each of the other 16
Funds in the Delaware Group and Delaware Manage-
ment Company, Inc.
PRESIDENT/CHIEF EXECUTIVE OFFICER AND DIRECTOR of Delaware
Management Trust Company.
SENIOR VICE PRESIDENT/CHIEF ADMINISTRATIVE OFFICER/CHIEF
FINANCIAL OFFICER/TREASURER of Delaware Management
Holdings, Inc.
SENIOR VICE PRESIDENT/CHIEF FINANCIAL OFFICER/TREASURER AND
DIRECTOR of DMH Corp.
SENIOR VICE PRESIDENT/CHIEF ADMINISTRATIVE OFFICER AND
DIRECTOR of Delaware Distributors, Inc.
SENIOR VICE PRESIDENT/CHIEF ADMINISTRATIVE OFFICER of
Delaware Distributors, L.P.
SENIOR VICE PRESIDENT/CHIEF ADMINISTRATIVE OFFICER/CHIEF
FINANCIAL OFFICER AND DIRECTOR of Delaware Service
Company, Inc.
CHIEF FINANCIAL OFFICER AND DIRECTOR of Delaware
International Holdings Ltd.
CHIEF FINANCIAL OFFICER/CHIEF OPERATING OFFICER of Delaware
Investment Counselors, Inc.
SENIOR VICE PRESIDENT AND DIRECTOR of Founders Holdings, Inc.
DIRECTOR of Delaware International Advisers Ltd.
Before joining the Delaware Group in 1992, Mr. Downes
was Chief Administrative Officer, Chief Financial
Officer and Treasurer of Equitable Capital Manage-
ment Corporation, New York, from December 1985
through August 1992, Executive Vice President from
December 1985 through March 1992, and Vice
Chairman from March 1992 through August 1992.

GEORGE M. CHAMBERLAIN, JR. (47)
SENIOR VICE PRESIDENT AND SECRETARY of the Fund, each of
the other 16 Funds in the Delaware Group, Delaware
Management Holdings, Inc. and Delaware
Distributors, L.P.
CORPORATE VICE PRESIDENT, SECRETARY AND DIRECTOR of
Founders Holdings, Inc.
SENIOR VICE PRESIDENT, SECRETARY AND DIRECTOR of DMH Corp.,
Delaware Management Company, Inc., Delaware
Distributors, L.P., Delaware Service Company, Inc.
and Delaware Management Trust Company.
SECRETARY AND DIRECTOR of Delaware International
Holdings Ltd.
SECRETARY of Delaware Investment Counselors, Inc.
DIRECTOR of Delaware International Advisers Ltd.
ATTORNEY.
During the past five years, Mr. Chamberlain has served
in various capacities at different times within the
Delaware organization.

<PAGE>

JOHN B. FIELDS (49)
VICE PRESIDENT/SENIOR PORTFOLIO MANAGER of the Fund, of
seven other equity funds in the Delaware Group and
of Delaware Management Company, Inc.
Before joining the Delaware Group in 1992, Mr. Fields
served as a director of domestic equity risk manage-
ment for DuPont, Wilmington, DE.

JOSEPH H. HASTINGS (45)
VICE PRESIDENT/CORPORATE CONTROLLER of the Fund, each of
the other 16 Funds in the Delaware Group, Delaware
Management Holdings, Inc., DMH Corp., Delaware
Management Company, Inc., Delaware Distributors,
L.P., Delaware Distributors, Inc., Delaware Service
Company, Inc. and Founders Holdings, Inc.
VICE PRESIDENT/CORPORATE CONTROLLER/TREASURER of Delaware
Management Trust Company.
1818 Market Street, Philadelphia, PA 19103.
Before joining the Delaware Group in 1992, Mr. Hastings
was Chief Financial Officer for Prudential Residential
Services, L.P., New York, NY from 1989 to 1992. Prior
to that, Mr. Hastings served as Controller and Treasurer
for Fine Homes International, L.P., Stamford, CT
from 1987 to 1989.

EUGENE J. CICHANOWSKY (48)
VICE PRESIDENT/CORPORATE TAX of the Fund, each of the
other 16 Funds in the Delaware Group, Delaware
Management Holdings, Inc., DMH Corp., Delaware
Management Company, Inc., Delaware Distributors,
L.P., Delaware Distributors, Inc., Delaware Service
Company, Inc., Founders Holdings, Inc. and Delaware
Management Trust Company.
1818 Market Street, Philadelphia, PA 19103.
During the past five years, Mr. Cichanowsky has served
in various capacities at different times within the
Delaware organization.

THERESA M. MESSINA (33)
VICE PRESIDENT/TREASURER of the Fund, each of the other
16 Funds in the Delaware Group and Delaware
Service Company, Inc.
VICE PRESIDENT/TREASURER/CHIEF FINANCIAL OFFICER of Founders
Holdings, Inc.
VICE PRESIDENT/ASSISTANT TREASURER of Delaware Management
Company, Inc., Delaware Distributors, L.P. and
Delaware Distributors, Inc.
VICE PRESIDENT of Delaware International Holdings Ltd.
Before joining the Delaware Group in 1994, Ms. Messina
was Vice President/Treasurer for Capital Holdings,
Frazer, PA. Prior to that, Ms. Messina was Vice
President/Fund Accounting for SEI Corporation,
Wayne, PA from 1988 to 1994.

27
<PAGE>

The following table provides for each disinterested
director compensation received as of November 30, 1994 from the Fund, the
total compensation received from all Delaware Group funds, and an estimate of
annual benefits to be received upon retirement under the Delaware Group
Retirement Plan.

PENSION OR
RETIREMENT ESTIMATED TOTAL
BENEFITS ANNUAL COMPENSATION
AGGREGATE ACCRUED BENEFITS FROM ALL 17
COMPENSATION AS PART OF UPON DELAWARE
NAME FROM FUND FUND EXPENSES RETIREMENT* GROUP FUNDS
W. Thacher Longstreth $5,401.00 None $18,100 $39,619.35
Ann R. Leven $6,253.86 None $18,100 $44,590.02
Walter P. Babich $6,083.32 None $18,100 $43,595.90
John J. Connolly, Ed.D. $5,401.00 None $18,100 $39,619.35
Anthony D. Knerr $6,166.48 None $18,100 $43,962.29
Charles E. Peck $5,058.00 None $18,100 $36,483.40
John H. Durham $4,715.00 None $18,100 $33,813.40

* Under the terms of the Delaware Group Retirement Plan for directors/trustees,
each disinterested director who, at the time of his or her retirement from the
Board, has attained the age of 70 and served on the Board for at least five
continuous years, is entitled to receive payments from the Fund for a period
equal to the lesser of the number of years that such person served as a
director or the remainder of such person's life. The amount of such payments
will be equal, on an annual basis, to the amount of the annual retainer that
is paid to directors of the Fund at the time of such person's retirement. If
an eligible director retired as of November 30, 1994, he or she would be
entitled to annual payments totaling $18,100, in the aggregate, from all of
the Funds in the Delaware Group, based on the number of funds in the Delaware
Group as of that date.

EXCHANGE PRIVILEGE

The exchange privileges available for shareholders of the Classes and for
shareholders of classes of other funds in the Delaware Group are set forth in
the relevant prospectuses for such classes. The following supplements that
information. The Fund reserves the right to reject exchange requests at any
time. The Fund may modify, terminate or suspend the exchange privilege upon
60 days' notice to shareholders.
All exchanges involve a purchase of shares of the fund into which the
exchange is made. As with any purchase, an investor should obtain and
carefully read that fund's prospectus before buying shares in an exchange.
The prospectus contains more complete information about the fund, including
charges and expenses. A shareholder requesting an exchange will be sent a
current prospectus and an authorization form for any of the other mutual
funds in the Delaware Group. Exchange instructions must be signed by the
record owner(s) exactly as the shares are registered.
An exchange constitutes, for tax purposes, the sale of one fund or series
and the purchase of another. The sale may involve either a capital gain or
loss to the shareholder for federal income tax purposes.
In addition, investment advisers and dealers may make exchanges between
funds in the Delaware Group on behalf of their clients by telephone or other
expedited means. This service may be discontinued or revised at any time by the
Transfer Agent. Such exchange requests may be rejected if it is determined that
a particular request or the total requests at any time could have an adverse
effect on any of the funds. Requests for expedited exchanges may be submitted
with a properly completed exchange authorization form, as described above.

<PAGE>

TELEPHONE EXCHANGE PRIVILEGE
Shareholders owning shares for which certificates have not been issued or
their investment dealers of record may exchange shares by telephone for
shares in other mutual funds in the Delaware Group. This service is
automatically provided unless the Fund receives written notice from the
shareholder to the contrary.
Shareholders or their investment dealers of record
may contact the Transfer Agent at 800-523-1918 (in Philadelphia, 988-1241)
or, in the case of shareholders of the Institutional Class, their Client
Services Representative at 800-828-5052, to effect an exchange. The
shareholder's current Series account number must be identified, as well as
the registration of the account, the share or dollar amount to be exchanged
and the fund into which the exchange is to be made. Requests received on any
day after the time the offering price and net asset value are determined will
be processed the following day. See DETERMINING OFFERING PRICE AND NET ASSET
VALUE. Any new account established through the exchange will automatically
carry the same registration, shareholder information and dividend option as
the account from which the shares were exchanged. The exchange requirements
of the fund into which the exchange is being made, such as sales charges,
eligibility and investment minimums, must be met. (See the prospectus of the
fund desired or inquire by calling the Transfer Agent or, as relevant, your
Client Services Representative.) Certain funds are not available for
Retirement Plans.
The telephone exchange privilege is intended as a convenience to
shareholders and is not intended to be a vehicle to speculate on short-term
swings in the securities market through frequent transactions in and out of
the funds in the Delaware Group. Telephone exchanges may be subject to
limitations as to amounts or frequency. The Transfer Agent and the Fund
reserve the right to record exchange instructions received by telephone and
to reject exchange requests at any time in the future.
As described in the Fund's prospectuses, neither the Fund nor the Transfer
Agent is responsible for any shareholder loss incurred in acting upon written
or telephone instructions for redemption or exchange of Series shares which
are reasonably believed to be genuine.
Following is a summary of the investment objectives of the other Delaware
Group funds:
DELAWARE FUND seeks long-term growth by a balance of capital appreciation,
income and preservation of capital. It uses a dividend-oriented valuation
strategy to select securities issued by established companies that are believed
to demonstrate potential for income and capital growth. DIVIDEND GROWTH FUND
seeks current income and capital appreciation by investing primarily in
income-producing common stocks, with a focus on common stocks the Manager
believes have the potential for above average dividend increases over time.

28
<PAGE>
TREND FUND seeks long-term growth by investing in common stock issued by
emerging growth companies exhibiting strong capital appreciation potential.
VALUE FUND seeks capital appreciation by investing primarily in common
stocks whose market values appear low relative to their underlying value or
future potential.
DELCAP FUND seeks long-term capital growth by investing in common stocks
and securities convertible into common stocks of companies that have a
demonstrated history of growth and have the potential to support continued
growth.
DECATUR INCOME FUND seeks the highest possible current income by investing
primarily in common stocks that provide the potential for income and capital
appreciation without undue risk to principal.
DELCHESTER FUND seeks as high a current income as possible by investing
principally in corporate bonds, and also in U.S. government securities and
commercial paper.
U.S. GOVERNMENT FUND seeks high current income by investing in long-term
U.S. government debt obligations.
TREASURY RESERVES INTERMEDIATE FUND seeks high, stable income by investing
primarily in a portfolio of short- and intermediate-term securities issued or
guaranteed by the U.S. government, its agencies and instrumentalities. U.S.
GOVERNMENT MONEY FUND seeks maximum current income with preservation of
principal and maintenance of liquidity by investing only in short-term
securities issued or guaranteed as to principal and interest by the U.S.
government, its agencies or instrumentalities, and repurchase agreements
collateralized by such securities, while maintaining a stable net asset
value.
DELAWARE CASH RESERVE seeks the highest level of income consistent with the
preservation of capital and liquidity through investments in short-term money
market instruments, while maintaining a stable net asset value.
TAX-FREE USA FUND seeks high current income exempt from federal income tax
by investing in municipal bonds of geographically-diverse issuers. TAX-FREE
INSURED FUND invests in these same types of securities but with an emphasis on
municipal bonds protected by insurance guaranteeing principal and interest are
paid when due. TAX-FREE USA INTERMEDIATE FUND seeks a high level of current
interest income exempt from federal income tax, consistent with the preservation
of capital by investing primarily in municipal bonds.
TAX-FREE MONEY FUND seeks high current income, exempt from federal income
tax, by investing in short-term municipal obligations, while maintaining a
stable net asset value.
TAX-FREE PENNSYLVANIA FUND seeks a high level of current interest income
exempt from federal and, to the extent possible, certain Pennsylvania state
and local taxes, consistent with the preservation of capital.
<PAGE>

INTERNATIONAL EQUITY FUND seeks to achieve long-term growth without undue
risk to principal by investing primarily in international securities that
provide the potential for capital appreciation and income. GLOBAL BOND FUND
seeks to achieve current income consistent with the preservation of principal
by investing primarily in global fixed income securities that may also
provide the potential for capital appreciation. GLOBAL ASSETS FUND seeks to
achieve long-term total return by investing in global securities which will
provide higher current income than a portfolio comprised exclusively of
equity securities, along with the potential for capital growth.
DELAWARE GROUP PREMIUM FUND offers nine series available exclusively as
funding vehicles for certain insurance company separate accounts. EQUITY/INCOME
SERIES seeks the highest possible total rate of return by selecting issues
that exhibit the potential for capital appreciation while providing higher
than average dividend income. HIGH YIELD SERIES seeks as high a current
income as possible by investing in rated and unrated corporate bonds, U.S.
government securities and commercial paper. CAPITAL RESERVES SERIES seeks a
high stable level of current income while minimizing fluctuations in
principal by investing in a diversified portfolio of short- and
intermediate-term securities. MONEY MARKET SERIES seeks the highest level
of income consistent with preservation of capital and liquidity through
investments in short-term money market instruments. GROWTH SERIES seeks
long-term capital appreciation by investing its assets in a diversified
portfolio of securities exhibiting the potential for significant growth.
MULTIPLE STRATEGY SERIES seeks a balance of capital appreciation, income and
preservation of capital. It uses a dividend-oriented valuation strategy to
select securities issued by established companies that are believed to
demonstrate potential for income and capital growth. INTERNATIONAL EQUITY SERIES
seeks long-term growth without undue risk to principal by investing primarily in
equity securities of foreign issuers that provide the potential for capital
appreciation and income. VALUE SERIES seeks capital appreciation by investing in
small- to mid-cap common stocks whose market values appear low relative to their
underlying value or future earnings and growth potential. Emphasis will also be
placed on securities of companies that may be temporarily out of favor or whose
value is not yet recognized by the market. EMERGING GROWTH SERIES seeks
long-term capital appreciation by investing primarily in small-cap common stocks
and convertible securities of emerging and other growth-oriented companies.
These securities will have been judged to be responsive to changes in the market
place and to have fundamental characteristics to support growth. Income is not
an objective.
For more complete information about any of these funds, including charges
and expenses, you can obtain a prospectus from the Distributor. Read it
carefully before you invest or forward funds.
Each of the summaries above is qualified in its entirety by the information
contained in each Fund's prospectus(es).

29
<PAGE>

GENERAL INFORMATION

The Manager is the investment manager of the Fund. The Manager or its
affiliate, Delaware International Advisers Ltd., manages the other funds in
the Delaware Group. The Manager, through a separate division, also manages
private investment accounts. While investment decisions of the Fund are made
independently from those of the other funds and accounts, they may make
investment decisions at the same time.
The Distributor acts as national distributor for the Fund and for the other
mutual funds in the Delaware Group. As previously described, prior to January
3, 1995, DDI served as the national distributor for the Fund. In its capacity
as such, DDI received net commissions from the Series on behalf of the Class
A Shares, after reallowances to dealers, as follows:

FISCAL TOTAL AMOUNT AMOUNTS NET
YEAR OF UNDERWRITING REALLOWED COMMISSION
ENDING COMMISSION TO DEALERS TO DDI
------ --------------- ---------- ----------
11/30/94 $1,406,240 $1,218,424 $187,816
11/30/93 1,771,659 1,533,223 238,436
11/30/92 1,948,084 1,732,709 215,375

Effective as of January 3, 1995, all such payments described above will be
paid to Delaware Distributors, L.P.
The Transfer Agent, an affiliate of the Manager, acts as shareholder
servicing, dividend disbursing and transfer agent for the Fund and for the
other mutual funds in the Delaware Group. The Transfer Agent is paid a fee by
the Series for providing these services consisting of an annual per account
charge of $5.50 plus transaction charges for particular services according to
a schedule. Compensation is fixed each year and approved by the Board of
Directors, including a majority of the unaffiliated directors.
The Manager and its affiliates own the name "Delaware Group." Under certain
circumstances, including the termination of the Fund's advisory relationship
with the Manager or its distribution relationship with the Distributor, the
Manager and its affiliates could cause the Fund to delete the words "Delaware
Group" from the Fund's name.
Chemical Bank, 450 West 33rd Street, New York, NY 10001, is custodian of the
Fund's securities and cash. As custodian for the Fund, Chemical Bank maintains a
separate account or accounts for the Fund; receives, holds and releases
portfolio securities on account of the Fund; receives and disburses money on
behalf of the Fund; and collects and receives income and other payments and
distributions on account of the Fund's portfolio securities.
The legality of the issuance of the shares offered hereby, pursuant to
registration under the Investment Company Act Rule 24f-2, has been passed upon
for the Fund by Messrs. Stradley, Ronon, Stevens & Young, Philadelphia,
Pennsylvania.

<PAGE>

CAPITALIZATION
The Fund has a present authorized capitalization of seven hundred fifty
million shares of capital stock with a $1.00 par value per share. Two hundred
million shares are allocated to the Series. Prior to July 26, 1993, the
Series offered only one class of shares, the class currently designated the
Class A Shares. The Series currently offers three classes of shares, each
representing a proportionate interest in the assets of the Series, and each
having the same voting and other rights and preferences as the other classes
of the Series, except that shares of the Institutional Class may not vote on
any matter affecting the Fund Classes' Distribution Plans under Rule 12b-1.
Similarly, the shareholders of the Class A Shares may not vote on matters
affecting the Series' Plan under Rule 12b-1 relating to the Class B Shares,
and the shareholders of the Class B Shares may not vote on matters affecting
the Series' Plan under Rule 12b-1 relating to the Class A Shares. General
expenses of the Series will be allocated on a pro-rata basis to the classes
according to asset size, except that expenses of the Rule 12b-1 Plans of the
Class A Shares and Class B Shares will be allocated solely to those classes.
The Board of Directors has allocated one hundred million shares to the Class A
Shares, fifty million shares to the Class B Shares and fifty million shares to
the Institutional Class. While all shares have equal voting rights on matters
affecting the entire Fund, the Series would vote separately on any matter which
affects only this Series, such as any change in its own investment objective and
policy or action to dissolve the Series and as otherwise prescribed by the
Investment Company Act of 1940. Shares of the Series have a priority in the
Series' assets, and in gains on and income from the portfolio of the Series.
Shares have no preemptive rights, are fully transferable and, when issued,
are fully paid and nonassessable.
From May 2, 1994 to September 5, 1994, the Decatur Total Return Fund A
Class was known as the Decatur Total Return Fund class and prior to May 2,
1994, it was known as the Decatur Fund II class. From May 2, 1994 to
September 5, 1994, the Decatur Total Return Fund Institutional Class was
known as the Decatur Total Return Fund (Institutional) class and prior to May
2, 1994, it was known as the Decatur Fund II (Institutional) class.

NONCUMULATIVE VOTING
THESE SHARES HAVE NONCUMULATIVE VOTING RIGHTS WHICH MEANS THAT THE HOLDERS
OF MORE THAN 50% OF THE SHARES OF THE FUND VOTING FOR THE ELECTION OF
DIRECTORS CAN ELECT ALL THE DIRECTORS IF THEY CHOOSE TO DO SO, AND, IN SUCH
EVENT, THE HOLDERS OF THE REMAINING SHARES WILL NOT BE ABLE TO ELECT ANY
DIRECTORS.
THIS PART B DOES NOT INCLUDE ALL OF THE INFORMATION CONTAINED IN THE
REGISTRATION STATEMENT WHICH IS ON FILE WITH THE SECURITIES AND EXCHANGE
COMMISSION.

30
<PAGE>

APPENDIX A -- IRA INFORMATION

The Tax Reform Act of 1986 restructured, and in some cases eliminated, the
tax deductibility of IRA contributions. Under the Act, the full deduction for
IRAs ($2,000 for each working spouse and $2,250 for one-income couples) was
retained for all taxpayers who are not covered by an employer-sponsored
retirement plan. Even if a taxpayer (or his or her spouse) is covered
by an employer-sponsored retirement plan, the full deduction is still
available if the taxpayer's adjusted gross income is below $25,000 ($40,000
for taxpayers filing joint returns). A partial deduction is allowed for
married couples with incomes between $40,000 and $50,000, and for single
individuals with incomes between $25,000 and $35,000. The Act does not permit
deductions for contributions to IRAs by taxpayers whose adjusted gross income
before IRA deductions exceeds $50,000 ($35,000 for singles) and who are
active participants in an employer-sponsored retirement plan. Taxpayers who
were not allowed deductions on IRA contributions still can make nondeductible
IRA contributions of as much as $2,000 for each working spouse ($2,250 for
one-income couples), and defer taxes on interest or other earnings from the
IRAs. Special rules apply for determining the deductibility of contributions
made by married individuals filing separate returns.
As illustrated in the following tables, maintaining an Individual
Retirement Account remains a valuable opportunity.
For many, an IRA will continue to offer both an up-front tax break with its
tax deduction each year and the real benefit that comes with tax-deferred
compounding. For others, losing the tax deduction will impact their taxable
income status each year. Over the long-term, however, being able to defer
taxes on earnings still provides an impressive investment opportunity--a way
to have money grow faster due to tax-deferred compounding.

31
<PAGE>
Even if your IRA contribution is no longer deductible, the benefits of
saving on a tax-deferred basis can be substantial. The following tables
illustrate the benefits of tax-deferred versus taxable compounding. Each
reflects a constant 10% rate of return, compounded annually, with the
reinvestment of all proceeds. The tables do not take into account any sales
charges or fees. Of course, earnings accumulated in your IRA will be subject
to tax upon withdrawal. If you choose a mutual fund with a fluctuating net
asset value, like the Series, your bottom line at retirement could be
lower--it could also be much higher.

$2,000 INVESTED ANNUALLY ASSUMING A 10% ANNUALIZED RETURN

15% Tax Bracket Single -- $0 - $22,750
--------------- Joint -- $0 - $38,000
<TABLE>
<CAPTION>
HOW MUCH YOU
END OF CUMULATIVE HOW MUCH YOU HAVE WITH FULL IRA
YEAR INVESTMENT AMOUNT HAVE WITHOUT IRA DEDUCTION
------ ----------------- ---------------- ------------------
<S> <C> <C> <C>
1 $ 2,000 $ 1,844 $ 2,200
5 10,000 10,929 13,431
10 20,000 27,363 35,062
15 30,000 52,074 69,899
20 40,000 89,231 126,005
25 50,000 145,103 216,364
30 60,000 229,114 361,887
35 70,000 355,438 596,254
40 80,000 545,386 973,704
</TABLE>
[Without IRA--investment of $1,700 ($2,000 less 15%) earning 8.5% (10% less
15%)]

28% Tax Bracket Single -- $22,751 - $55,100
--------------- Joint -- $38,001 - $91,850
<TABLE>
<CAPTION>

END OF CUMULATIVE HOW MUCH YOU HOW MUCH YOU HAVE WITH FULL IRA
YEAR INVESTMENT AMOUNT HAVE WITHOUT IRA NO DEDUCTION DEDUCTION
------ ----------------- ---------------- ------------ ---------
<S> <C> <C> <C> <C>
1 $ 2,000 $ 1,544 $ 1,584 $ 2,200
5 10,000 8,913 9,670 13,431
10 20,000 21,531 25,245 35,062
15 30,000 39,394 50,328 69,899
20 40,000 64,683 90,724 126,005
25 50,000 100,485 155,782 216,364
30 60,000 151,171 260,559 361,887
35 70,000 222,927 429,303 596,254
40 80,000 324,512 701,067 973,704
</TABLE>
[Without IRA--investment of $1,440 ($2,000 less 28%) earning 7.2% (10% less
28%)]
[With IRA--No Deduction--investment of $1,440 ($2,000 less 28%) earning 10%]

31% Tax Bracket Single -- $55,101 - $115,000
--------------- Joint -- $91,851 - $140,000
<TABLE>
<CAPTION>

END OF CUMULATIVE HOW MUCH YOU HOW MUCH YOU HAVE WITH FULL IRA
YEAR INVESTMENT AMOUNT HAVE WITHOUT IRA NO DEDUCTION DEDUCTION
------ ----------------- ---------------- ------------ ---------
<S> <C> <C> <C> <C>
1 $ 2,000 $ 1,475 $ 1,518 $ 2,200
5 10,000 8,467 9,268 13,431
10 20,000 20,286 24,193 35,062
15 30,000 36,787 48,231 69,899
20 40,000 59,821 86,943 126,005
25 50,000 91,978 149,291 216,364
30 60,000 136,868 249,702 361,887
35 70,000 199,536 411,415 596,254
40 80,000 287,021 671,855 973,704
</TABLE>
[Without IRA--investment of $1,380 ($2,000 less 31%) earning 6.9% (10% less
31%)]
[With IRA--No Deduction--investment of $1,380 ($2,000 less 31%) earning 10%]

32
<PAGE>
36% Tax Bracket* Single -- $115,001 - $250,000
---------------- Joint -- $140,001 - $250,000
<TABLE>
<CAPTION>
END OF CUMULATIVE HOW MUCH YOU HOW MUCH YOU HAVE WITH FULL IRA
YEAR INVESTMENT AMOUNT HAVE WITHOUT IRA NO DEDUCTION DEDUCTION
------ ----------------- ---------------- ------------ ---------
<S> <C> <C> <C> <C>
1 $ 2,000 $ 1,362 $ 1,408 $ 2,200
5 10,000 7,739 8,596 13,431
10 20,000 18,292 22,440 35,062
15 30,000 32,683 44,736 69,899
20 40,000 52,308 80,643 126,005
25 50,000 79,069 138,473 216,364
30 60,000 115,562 231,608 361,887
35 70,000 165,327 381,602 596,254
40 80,000 233,190 623,170 973,704
</TABLE>
[Without IRA--investment of $1,280 ($2,000 less 36%) earning 6.4% (10% less
36%)]
[With IRA--No Deduction--investment of $1,280 ($2,000 less 36%) earning 10%]

39.6% Tax Bracket* Single -- over $250,000
------------------ Joint -- over $250,000
<TABLE>
<CAPTION>
END OF CUMULATIVE HOW MUCH YOU HOW MUCH YOU HAVE WITH FULL IRA
YEAR INVESTMENT AMOUNT HAVE WITHOUT IRA NO DEDUCTION DEDUCTION
------ ----------------- ---------------- ------------ ---------
<S> <C> <C> <C> <C>
1 $ 2,000 $ 1,281 $ 1,329 $ 2,200
5 10,000 7,227 8,112 13,431
10 20,000 16,916 21,178 35,062
15 30,000 29,907 42,219 69,899
20 40,000 47,324 76,107 126,005
25 50,000 70,677 130,684 216,364
30 60,000 101,986 218,580 361,887
35 70,000 143,965 360,137 596,254
40 80,000 200,249 588,117 973,704

[Without IRA--investment of $1,208 ($2,000 less 39.6%) earning 6.04% (10% less
39.6%)]
[With IRA--No Deduction--investment of $1,208 ($2,000 less 39.6%) earning 10%]
</TABLE>

$2,000 SINGLE INVESTMENT AT A RETURN OF 10% COMPOUNDED QUARTERLY
<TABLE>
<CAPTION>
TAXABLE-- TAXABLE-- TAXABLE-- TAXABLE-- TAXABLE-- TAX
YEARS 39.6%* 36%* 31% 28% 15% DEFERRED
----- --------- --------- --------- --------- --------- --------
<S> <C> <C> <C> <C> <C> <C>
10 $ 3,642 $ 3,774 $ 3,964 $ 4,083 $ 4,638 $ 5,370
15 4,915 5,184 5,581 5,833 7,062 8,800
20 6,633 7,121 7,857 8,334 10,755 14,419
30 12,081 13,436 15,572 17,012 24,939 38,716
40 22,001 25,352 30,865 34,728 57,831 103,956
</TABLE>

$2,000 INVESTED ANNUALLY AT A RETURN OF 10% COMPOUNDED QUARTERLY
<TABLE>
<CAPTION>
TAXABLE-- TAXABLE-- TAXABLE-- TAXABLE-- TAXABLE-- TAX
YEARS 39.6%* 36%* 31% 28% 15% DEFERRED
----- --------- --------- --------- --------- --------- --------
<S> <C> <C> <C> <C> <C> <C>
10 $ 28,226 $ 28,833 $ 29,702 $ 30,239 $ 32,699 $ 35,834
15 50,104 51,753 54,152 55,654 62,755 72,298
20 79,629 83,239 88,573 91,966 108,525 132,049
30 173,245 185,894 205,256 217,971 284,358 390,394
40 343,773 379,596 436,523 475,187 692,097 1,084,066
</TABLE>
* For tax years beginning after 1992, a 36% tax rate applies to all taxable
income in excess of the maximum dollar amounts subject to the 31% tax rate. In
addition, a 10% surtax (not applicable to capital gains) applies to certain
high-income taxpayers. It is computed by applying a 39.6% rate to taxable
income in excess of $250,000. The above tables do not reflect the personal
exemption phaseout nor the limitations of itemized deductions that may apply.
33
<PAGE>

THE VALUE OF STARTING YOUR IRA EARLY
The following illustrates how much more you would have contributing $2,000
each January--the earliest opportunity--compared to contributing on April 15th
of the following yearthe latest, for each tax year.

After 5 years $3,528 more
10 years $6,113
20 years $17,228
30 years $47,295

Compounded returns for the longest period of time is the key. The above
illustration assumes a 10% rate of return and the reinvestment of all
proceeds.
AND IT PAYS TO SHOP AROUND. If you get just 2% more per year, it can make a
big difference when you retire. A constant 8% versus 10% return, both
compounded quarterly, illustrates the point. This chart is based on a yearly
investment of $2,000 on January 1. After 30 years the difference can mean as
much as 50% more!

8% Return 10% Return
--------- ----------
10 Years $ 31,726 $ 35,834
30 Years 256,465 390,394

The statistical exhibits above are for illustration purposes only and do
not reflect the actual performance for the Series either
in the past or in the future.

34
<PAGE>

APPENDIX B

THE COMPANY LIFE CYCLE
Traditional business theory contends that a typical company progresses
through basically four stages of development, keyed closely to a firm's sales.
1. EMERGING GROWTH--a period of experimentation in which the company builds
awareness of a new product or firm.
2. ACCELERATED DEVELOPMENT--a period of rapid growth with potentially high
profitability and acceptance of the product.
3. MATURING PHASE--a period of diminished real growth due to dependence on
replacement or sustained product demand.
4. CYCLICAL STAGE--a period in which a company faces a potential saturation
of demand for its product. At this point, a firm either diversifies or
becomes obsolete.

Hypothetical Corporate Life Cycle Chart shows in a line illustration, the stages
that a typical company would go through, beginning with the emerging state where
sales growth continues at a steep pace to the mature phase where growth levels
off to the cyclical stage where sales show more definitive highs and lows.

The above chart illustrates the path traditionally
followed by companies that successfully survive the growth sequence.

35
<PAGE>

FINANCIAL STATEMENTS

The Delaware Group Decatur Fund, Inc.-Decatur Total Return Fund's STATEMENT
OF NET ASSETS, STATEMENT OF OPERATIONS, STATEMENT OF CHANGES IN NET ASSETS,
and NOTES TO FINANCIAL STATEMENTS, as well as the report of Ernst & Young
LLP, independent auditors, for the fiscal year ended November 30, 1994 are
included in the Series' ANNUAL REPORT to shareholders. The Series was
formerly known as Decatur Fund II. The financial statements, the notes
relating thereto and the report of Ernst & Young LLP, listed above are
incorporated by reference from the ANNUAL REPORT into this PART B.

<PAGE>

Supplement Dated August 29, 1995
to the Current Statements of Additional Information
of the Following Delaware Group Funds

Delaware Group Delaware Fund, Inc.,
Delaware Group Trend Fund, Inc.,
Delaware Group Value Fund, Inc.,
Delaware Group Decatur Fund, Inc.,
Delaware Group DelCap Fund, Inc.,
Delaware Group Global & International Funds, Inc.,
Delaware Group Delchester High-Yield Bond Fund, Inc.,
Delaware Group Government Fund, Inc.,
Delaware Group Tax-Free Fund, Inc.,
Delaware Group Limited-Term Government Funds, Inc.,
Delaware Group Tax-Free Money Fund, Inc.,
Delaware Group Cash Reserve, Inc.,
DMC Tax-Freee Income Trust-Pennsylvania

The exchange policy of the Fund as stated under "Redemption and Exchange"
is amended as follows with regard to accounts that are administered by market
timing services ("Timing Firms") to purchase or redeem shares based on changing
economic and market conditions ("Timing Accounts"):

Right To Refuse Timing Accounts
Effective immediately, the Fund reserves the right to refuse any new Timing
Arrangements as well as any new purchases (as opposed to exchanges) in Delaware
Group funds from Timing Firms.

Restrictions on Timed Exchanges
Effective 60 days from this notice, Timing Accounts operating under
existing Timing Agreements may only execute exchanges between the following six
Delaware Group funds: 1) Decatur Income Fund, 2) Decatur Total Return Fund, 3)
Delaware Fund, 4) Limited-Term Government Fund, 5) Tax-Free USA Fund and 6)
Delaware Cash Reserve. No other Delaware Group funds will be available for Timed
Exchanges. Assets redeemed or exchanged out of Timing Accounts in Delaware Group
funds not listed above may not be reinvested back into that Timing Account.
In addition, 60 days hence, the Fund will terminate, except as noted above,
all exchanges privileges, including telephone and written redemption privileges,
previously made available to Timing Firms. At such time, only shareholders and
their authorized brokers of record will be permitted to make exchanges or
redemptions.