<PAGE>
DELAWARE(SM)
INVESTMENTS
- -----------
Delaware Social Awareness Fund
(Growth of Capital Artwork)
Growth
of Capital
1999 ANNUAL REPORT
<PAGE>
A TRADITION OF SOUND INVESTING SINCE 1929
TABLE OF CONTENTS
- -----------------
Letter to Shareholders 1
Portfolio Management
Review 3
Performance Summary 6
Financial Statements
Statement of Net Assets 7
Financial Highlights 12
A Commitment To Our Investors
Experienced
[ ] Our seasoned investment professionals average more than 15 years'
experience.
[ ] For over 70 years, we have managed money in a variety of investment styles
that have weathered a full range of economic and market environments.
Disciplined
[ ] We follow strict investment policies and clear buy/sell guidelines.
[ ] We strive to balance risk and reward in order to provide relatively
conservative investment alternatives within any given asset class.
Consistent
[ ] We believe consistent processes are the best way to seek consistent
investment performance.
[ ] Our commitment to style consistency has earned us the confidence of
discriminating institutional and individual investors to manage
approximately $47 billion in assets as of December 31, 1999.
Comprehensive
[ ] We offer more than 60 mutual funds in these asset classes.
o Large-cap equity o High-yield bonds
o Mid-cap equity o Investment grade bonds
o Small-cap equity o Municipal bonds (24 single-state funds)
o International equity o International fixed-income
o Balanced
[ ] Our funds are available through financial advisers who can offer you
individualized attention and valuable investment advice.
Funds are not FDIC insured and are not guaranteed. It is possible to lose the
principal amount invested.
(C)Delaware Distributors, L.P.
<PAGE>
Dear Shareholder
December 7, 1999
Recap of Events -- The U.S. stock market has provided considerable capital
appreciation since the start of our fiscal year on December 1, 1998. Initially,
there were concerns about the effects of economic crises in Asia, Russia, Japan
and Latin America. However, three Federal Reserve interest rate cuts sent many
investments bouncing back from the financial losses suffered in the summer and
fall of 1998.
Since that date, the stock market has recovered in dramatic fashion. The Dow
Jones Industrial Average closed above both the 10,000 and 11,000 marks for the
first time in the spring of 1999. Low inflation enabled the Federal Reserve to
keep interest rates low and the U.S. stock market moved steadily higher.
Strong economic activity and a booming stock market heightened inflationary
concerns. The Federal Reserve responded by raising interest rates on June 30th,
August 24th and November 16th, effectively taking back all three rate reductions
of the previous year. As of this writing, the Federal funds target rate on
overnight loans between banks stands at 5.50%, the same level as 14 months ago.
Delaware Social Awareness Fund capitalized on a fortuitous environment and
provided a total return of +15.44% (Class A shares at net asset value with
distributions reinvested) for the year ended November 30, 1999. We attribute
Delaware Social Awareness Fund's positive performance to strong stock selection
in the technology sector. Your Fund's subadviser, Vantage Investment Advisors of
New York, combines a socially responsible selection process with
computer-driven, quantitative stock selection. In general, your Fund seeks
attractively priced stocks with favorable long-term earnings prospects.
WE ATTRIBUTE DELAWARE
SOCIAL AWARENESS
FUND'S POSITIVE
PERFORMANCE TO STRONG
STOCK SELECTION IN THE
TECHNOLOGY SECTOR.
Average Annual Total Returns
For Periods Ended November 30, 1999 One Year Lifetime*
- --------------------------------------------------------------------------------
Delaware Social Awareness Fund Class A +15.44% +16.79%
- --------------------------------------------------------------------------------
Standard & Poor's 500 Index +20.83% +31.25%
Domini Social 400 Index +25.96% +29.00%
Lipper Multi-Cap Core Funds Average +19.12% (365 funds) +18.07% (253 funds)
All performance shown above is at net asset value without the effect of sales
charges and assumes reinvestment of distributions. Performance information for
all other Fund classes can be found on page 6. All indexes cited are unmanaged.
The S&P 500 Index is a composite of large company stocks. The Domini Social 400
Index is a benchmark of 400 U.S. corporations that pass multiple, broad-based
social screens set by Kinder, Lydenberg, Domini & Co. The Lipper Multi-Cap Core
Funds Average is the average of all multi-cap core funds tracked by Lipper
Analytical. Past performance does not guarantee future results. You cannot
invest directly in an index.
*February 24, 1997 (commencement of operations).
(Growth of Capital Artwork)
1
<PAGE>
(Growth of Capital Artwork)
Market Outlook-- Despite strong performance through most of the year, the
U.S. stock market suffered in the third quarter of 1999. In October and
November, consumer and manufacturing reports suggested our economy might be
overheating. Regardless, your Fund's managers believe the current economic
environment of low interest rates, steady growth and low inflation provides
fertile ground for long-term stock market growth. On the pages that follow,
Delaware Social Awareness Fund's portfolio managers share their outlook and
concerns for the U.S. economy in the coming year. They also review their
investment selection process and discuss some of the individual investments that
impacted Fund performance in fiscal 1999.
With many opportunities still ahead, we look forward to working with you to make
the most of your investments. Thank you for your continued confidence in
Delaware Social Awareness Fund and Delaware Investments.
Sincerely,
/s/ Wayne A. Stork /s/ David K. Downes
- --------------------------- -----------------------------
Wayne A. Stork David K. Downes
Chairman, President and Chief Executive
Delaware Investments Officer, Delaware Investments
2
<PAGE>
(Growth of Capital Artwork)
PORTFOLIO MANAGEMENT REVIEW
Enrique Chang
Senior Vice President/
Chief Investment Officer
Vantage Investment Advisors
Christopher P. Harvey
Vice President
Vantage Investment Advisors
December 7, 1999
The Fund's Results
Delaware Social Awareness Fund delivered a +15.44% return for the year ended
November 30, 1999 (Class A shares at net asset value with distributions
reinvested). Driving your Fund's strong performance was our stock picking
technique which evaluates some 1,200 mid- and large-cap U.S. stocks every day.
Companies are first examined to see whether they meet your Fund's socially
responsible screens.
Delaware Social Awareness Fund avoids companies that:
o Pollute the environment;
o Produce nuclear power, design or construct nuclear power plants or manufacture
equipment for the production of nuclear power;
o Make military weapons;
o Conduct animal testing for cosmetics or personal care products;
o Make alcoholic beverages or tobacco products; or
o Are involved in the gambling industry.
During fiscal 1999, approximately 800 companies met our social screens. We then
employed Vantage Investment Advisors' proprietary computer software, which
allows us to evaluate the companies on a quantitative basis every business day.
We evaluate raw data from each company, including the price/earnings ratio of
its stock, earnings estimates from many Wall Street analysts, and a number of
other factors. Each stock is then ranked against all other stocks in its
industry sector. This computer analysis is designed to lead us to:
o Stocks with a low price/earnings ratio--stocks whose share price is low in
relation to earnings per share; and
o Companies whose earnings growth rates are accelerating and/or whose earnings
results have risen above previous estimates.
Portfolio Highlights
This past fiscal year, we avoided the energy sector as we typically do, because
these companies are generally not environmentally friendly. Unfortunately,
energy delivered strong returns with the spike in oil prices and we missed out
on some of this sector's outperformance. Instead, we overweighted your Fund in
areas of technology and financial services this past year in an attempt to keep
pace with the S&P 500, which does hold energy companies. While fiscal 1999 was a
strong year for computers and technology, financial services firms did not fare
as well. The trouble experienced by this sector, along with our lack of exposure
to energy, helps explain why your Fund underperformed the S&P 500 for the year
ended November 30, 1999.
Quantitative Investing
Harnessing the Power of Technology
Universe of 1,200 mid- and large-
capitalization companies
800 stocks that meet social
responsibility criteria
Computer-driven quantitative
fundamental analysis
Ranking of stocks based on both
growth and value characteristics
148 stocks selected
for the portfolio*
*As of November 30, 1999. The number of stocks
selected will fluctuate.
3
<PAGE>
As we reported in Delaware Social Awareness Fund's semi-annual report in
June 1999, we tend to avoid many "super cap" stocks - very large company stocks
with relatively high price/earnings ratios - because they fail to rate highly
according to our growth and value investment parameters. For this reason, your
Fund held more medium-sized companies than the S&P 500. One super cap stock that
did meet our investment parameters this past year was Microsoft. As many know,
Microsoft develops, sells and supports software products. Lately, Microsoft has
also been spending considerable energy developing the "MSN" network of Internet
services. In a crushing blow to Microsoft's antitrust case, a federal judge
ruled on November 5th that the software company does indeed hold a monopoly
thanks to its pervasive Windows operating systems. Because appeals are likely to
keep the case in court - and delay any sanctions - for several years, we believe
we will continue to hold this stock. One of the most popular options the Justice
Department is considering is breaking up the world's largest software company
into identical spinoffs, dubbed "Baby Bills," and set them to compete against
each other. Despite the landmark decision, we were pleased with the performance
of Delaware Social Awareness Fund's top holding and believe we own the stock at
a reasonable price.
Our technology holdings helped boost your Fund's performance during fiscal 1999.
We were pleased with the performance of Apple Computer throughout the period.
Apple has been successful in marketing its newest addition to the company's line
of computers - the iMac(TM), a PC competitive with other lower priced models.
Apple is also taking a cue from Dell Computer and is now selling built-to-order
systems online. Over the past five quarters, Apple's average earnings percentage
increase has been over 36.0% (Source: Bloomberg). We believe this bodes well for
the company's future.
Financial stocks proved to be a disappointing sector for your Fund throughout
fiscal 1999. The past year was a challenging one for these companies as they
dealt with a rapidly changing interest rate environment and increased pricing
competition. Of the stocks we hold in this sector, Allstate, which provides
property-liability insurance, was a laggard. The largest U.S. publicly traded
car and home insurer saw its profit margins squeezed by competitive price cuts,
higher costs and storm losses.
Your Fund strives to approximately match the sector weightings of
the Standard & Poor's 500 Index, a capitalization-weighted index of 500 stocks.
The financial sector was also a poor performer for the S&P 500 for the one-year
period ending November 30, 1999.
DRIVING YOUR FUND'S
STRONG PERFORMANCE
WAS OUR STOCK PICKING
TECHNIQUE WHICH
EVALUATES SOME 800
MID- AND LARGE-CAP
U.S. STOCKS EVERY DAY.
4
<PAGE>
Outlook
We believe the current economic environment of low interest rates, steady growth
and low inflation provides fertile ground for long-term stock market growth. The
positioning of Delaware Social Awareness Fund's portfolio over the past fiscal
year has helped it benefit from U.S. economic growth while escaping the impact
of struggling international markets. Many of the companies in the portfolio
generate the majority of their revenues from U.S. and/or European markets. At
this time we think there is room for continued optimism for the stock market and
believe Delaware Social Awareness Fund is well positioned to capitalize on any
market strength in the first half of fiscal 2000.
Top Portfolio Holdings
November 30, 1999
<TABLE>
<CAPTION>
Industry Percent of Net Assets
- -------------------------------------------------------------------------------------------
<S> <C> <C>
1. Microsoft Computers & Technology 4.3%
- -------------------------------------------------------------------------------------------
2. Cisco Systems Computers & Technology 2.6%
- -------------------------------------------------------------------------------------------
3. EMC Computers & Technology 2.0%
- -------------------------------------------------------------------------------------------
4. Bell South Telecommunications 1.9%
- -------------------------------------------------------------------------------------------
5. AT&T Telecommunications 1.9%
- -------------------------------------------------------------------------------------------
6. SBC Communications Telecommunications 1.8%
- -------------------------------------------------------------------------------------------
7. Wal-Mart Stores Retail 1.8%
- -------------------------------------------------------------------------------------------
8. Morgan Stanley Dean Witter Banking, Finance & Insurance 1.7%
- -------------------------------------------------------------------------------------------
9. Home Depot Retail 1.6%
- -------------------------------------------------------------------------------------------
10. Chase Manhattan Banking, Finance & Insurance 1.6%
- -------------------------------------------------------------------------------------------
</TABLE>
DELAWARE SOCIAL
AWARENESS FUND IS
WELL POSITIONED TO
CAPITALIZE ON ANY
MARKET STRENGTH IN
THE FIRST HALF OF
FISCAL 2000.
5
<PAGE>
Delaware Social Awareness Fund
FUND PERFORMANCE
- ----------------
Growth of a $10,000 Investment
February 24, 1997-November 30, 1999
<TABLE>
<CAPTION>
Feb-97 May-97 Nov-97 May-98 Nov-98 May-99 Nov-99
<S> <C> <C> <C> <C> <C> <C> <C>
Domini Social 400 index 10,000 10,848 12,547 14,449 15,991 18,147 $20,142
S&P 500 index 10,000 10,727 12,081 13,794 14,714 16,462 $17,565
Lipper Multi-Cap Core Funds Average (253 funds) 10,000 10,449 11,805 13,163 13,128 14,785 $15,871
Delaware Social Awareness Fund Class A 9,424 9,712 11,452 12,999 12,543 13,623 $14,480
</TABLE>
FUND BASICS
- -----------
Fund Objective
Seeks long-term capital
appreciation. It invests primarily in
mid-sized to large companies that
meet certain socially responsible
investment criteria.
Assets Under Management
$97 million
Number of Holdings
148
Fund Start Date
February 24, 1997
Your Fund Managers
Enrique Chang holds a B.A. from
Fairleigh Dickinson University and
an M.S. and M.B.A. from New York
University. He has 11 years of Wall
Street experience.
Christopher P. Harvey holds a
B.S. degree from Bucknell
University and an M.B.A. from
New York University. He has eight
years of Wall Street experience.
NASDAQ SYMBOLS
Class A DEQAX
Class B DEQBX
Class C DEQCX
(Growth of
Capital Artwork)
<PAGE>
Chart assumes $10,000 invested on February 24, 1997 and includes the effect of a
5.75% front-end sales charge and reinvestment of distributions. An expense
limitation was in effect for all classes of Delaware Social Awareness Fund.
Performance would have been lower if the expense limitation were not in effect.
Performance for other Fund classes will vary due to different charges and
expenses. Past performance does not guarantee future results.
Average Annual Returns
Through November 30, 1999 Lifetime One Year
- --------------------------------------------------------------------------------
Class A (Est. 2/24/97)
Excluding Sales Charge +16.79% +15.44%
Including Sales Charge +14.31% +8.78%
- --------------------------------------------------------------------------------
Class B (Est. 2/24/97)
Excluding Sales Charge +15.91% +14.57%
Including Sales Charge +15.07% +9.57%
- --------------------------------------------------------------------------------
Class C (Est. 2/24/97)
Excluding Sales Charge +15.91% +14.57%
Including Sales Charge +15.91% +13.57%
- --------------------------------------------------------------------------------
Returns reflect reinvestment of distributions and any applicable sales charges
as noted below. Return and share value will fluctuate so that shares when
redeemed may be worth more or less than the original cost. Class B and C results
excluding sales charge assume either that contingent sales charges did not apply
or the investment was not redeemed. Past performance is not a guarantee of
future results.
Class A shares have a 5.75% maximum front-end sales charge and a 12b-1 fee.
Class B shares do not have a front-end sales charge, but are subject to a 1%
annual distribution and service fee and a contingent deferred sales charge of up
to 5% if redeemed before the end of the sixth year.
Class C shares have a 1% annual distribution and service fee. If shares are
redeemed within 12 months, a 1% contingent deferred sales charge applies.
Institutional Class shares are available without sales or asset-based
distribution charges only to certain eligible institutional accounts.
Average Annual Returns Through November 30, 1999 Lifetime One Year
- --------------------------------------------------------------------------------
Institutional Class (Est. 2/24/97) +17.05% +15.74%
NASDAQ Symbol Institutional Class: DEQNX
6
<PAGE>
Statement of Net Assets
Delaware Group Equity Funds II -- DELAWARE SOCIAL AWARENESS FUND
------------------------------
November 30, 1999 Number of Market
Shares Value
- --------------------------------------------------------------------------------
Common Stock - 99.27%
Automobiles & Auto Parts - 0.17%
PACCAR ............................................. 3,900 $ 160,509
----------
160,509
----------
Banking, Finance & Insurance - 21.91%
A.G. Edwards ....................................... 20,955 623,411
Allmerica Financial ................................ 2,400 132,450
Allstate ........................................... 22,230 582,148
Ambac Financial Group .............................. 10,100 550,450
American Express ................................... 8,100 1,225,631
American International Group ....................... 10,375 1,071,219
AmSouth Bancorporation ............................. 15,304 345,296
Bank One ........................................... 2,041 71,945
BB&T ............................................... 10,000 321,250
Chase Manhattan .................................... 20,000 1,545,000
Citigroup .......................................... 27,952 1,505,914
City National ...................................... 7,905 285,074
Comerica ........................................... 8,070 427,710
Conseco ............................................ 14,900 301,725
Dime Bancorp ....................................... 40,300 735,475
Fannie Mae ......................................... 18,600 1,239,225
Freddie Mac ........................................ 10,500 518,437
Financial Security Assurance Holdings Limited ...... 3,700 195,406
First Union ........................................ 7,590 293,638
*FIRSTPLUS Financial Group .......................... 28,100 4,496
Hartford Financial Services ........................ 17,800 831,037
Hibernia Class A ................................... 28,100 356,519
Marsh & McLennan ................................... 4,520 355,385
Mellon Financial ................................... 8,140 296,601
Metris ............................................. 37,108 1,173,541
Morgan Stanley Dean Witter ......................... 14,000 1,688,750
National City ...................................... 9,424 235,011
Old Republic International ......................... 5,592 69,900
PaineWebber Group .................................. 13,905 544,902
PMI Group .......................................... 2,750 137,328
PNC Financial Group ................................ 4,300 239,725
SLM Holding ........................................ 13,902 689,018
SouthTrust ......................................... 5,000 194,219
St. Paul ........................................... 6,100 184,144
T. Rowe Price Associates ........................... 4,000 143,875
Unionbancal Corporation ............................ 27,900 1,229,344
Valley National Bancorp ............................ 21,550 541,444
Washington Mutual .................................. 16,093 466,697
----------
21,353,340
----------
Buildings & Materials - 0.88%
*American Standard .................................. 8,300 323,181
Kaufman & Broad Home ............................... 19,700 435,863
York International ................................. 4,400 98,175
----------
857,219
----------
<PAGE>
Number of Market
Shares Value
- --------------------------------------------------------------------------------
Common Stock (continued)
Cable, Media & Publishing - 4.95%
*Circle.com ......................................... 3,000 $ 39,094
Dun and Bradstreet ................................. 14,690 396,630
Gannett ............................................ 8,860 634,044
Knight-Ridder ...................................... 4,400 240,075
McGraw-Hill ........................................ 14,800 838,975
New York Times ..................................... 21,970 844,472
Omnicom Group ...................................... 6,560 578,100
R.H. Donnelley ..................................... 16,938 315,470
*Snyder Communications .............................. 12,000 161,250
Time Warner ........................................ 2,000 123,375
*Valassis Communications ............................ 16,550 651,656
----------
4,823,141
----------
Chemicals - 1.03%
Avery Dennison ..................................... 4,200 249,375
Lubrizol ........................................... 27,600 755,550
----------
1,004,925
----------
Computers & Technology - 22.70%
*Adaptec ............................................ 14,600 787,031
*America Online ..................................... 16,800 1,221,150
*American Power Conversion .......................... 11,340 269,679
*Apple Computer ..................................... 13,500 1,320,891
*Applied Materials .................................. 4,400 428,862
*BMC Software ....................................... 11,800 859,556
*Cisco Systems ...................................... 27,900 2,487,459
Compaq Computer .................................... 11,200 273,700
Computer Associates International .................. 21,000 1,365,000
*Compuware .......................................... 22,800 771,637
*Comverse Technology ................................ 8,900 1,075,787
*Dell Computer ...................................... 32,700 1,407,122
Deluxe ............................................. 21,525 563,686
*EMC ................................................ 23,000 1,921,937
*Electronics Arts ................................... 10,800 1,132,650
*Lexmark International .............................. 16,800 1,394,400
*Microsoft .......................................... 45,600 4,151,025
*Symantec ........................................... 10,000 466,563
*Teradyne ........................................... 5,000 217,813
----------
22,115,948
----------
Consumer Products - 2.10%
Avon Products ...................................... 10,230 372,756
Clorox ............................................. 1,980 88,234
Gillette ........................................... 10,000 401,875
Maytag ............................................. 12,900 615,169
Ralston-Purina Group ............................... 2,400 71,250
*United Stationers .................................. 21,400 498,888
----------
2,048,172
----------
7
<PAGE>
Statement of Net Assets (continued)
Delaware Social Awareness Fund Number of Market
Shares Value
- --------------------------------------------------------------------------------
Common Stock (continued)
Electronics & Electrical Equipment - 2.81%
General Cable ...................................... 27,200 $ 210,800
*LSI Logic .......................................... 3,900 235,706
*Microchip Technology ............................... 8,000 506,750
*Sanmina ............................................ 9,500 912,000
*Waters ............................................. 17,900 877,100
----------
2,742,356
----------
Energy - 2.02%
Apache ............................................. 6,400 229,200
*Barrett Resources .................................. 8,200 217,812
Enron .............................................. 25,600 974,400
Equitable Resources ................................ 7,600 264,575
Questar ............................................ 16,500 283,594
----------
1,969,581
----------
Food & Beverage - 3.13%
*Agribrands International ........................... 80 3,765
General Mills ...................................... 17,600 663,300
Interstate Bakeries ................................ 16,650 293,456
*Keebler Foods ...................................... 24,000 661,500
Quaker Oats ........................................ 13,690 893,273
*Suiza Foods ........................................ 11,700 420,469
Universal Foods .................................... 5,440 115,600
----------
3,051,363
----------
Healthcare & Pharmaceuticals - 8.53%
*AmeriSource Health ................................. 20,000 247,500
*Amgen .............................................. 30,800 1,402,362
Bergen Brunswig Class A ............................ 30,467 251,353
*Biogen ............................................. 3,100 226,397
*Boston Scientific .................................. 11,000 232,375
C.R. Bard .......................................... 16,400 890,725
Cardinal Health .................................... 13,448 703,498
Eli Lilly .......................................... 9,100 652,925
*Health Management Associates ....................... 42,300 520,819
*IVAX ............................................... 13,200 268,125
*Lincare Holdings ................................... 5,970 169,026
McKesson ........................................... 21,559 503,942
Medtronic .......................................... 35,446 1,377,963
Mylan Laboratories ................................. 16,900 398,206
*Rexall Sundown ..................................... 42,400 433,275
*Ventiv Health ...................................... 4,000 31,875
----------
8,310,366
----------
Industrial Machinery - 1.22%
Illinois Tool Works ................................ 8,323 538,942
Ingersoll-Rand ..................................... 13,400 649,063
----------
1,188,005
----------
<PAGE>
Number of Market
Shares Value
- --------------------------------------------------------------------------------
Common Stock (continued)
Leisure, Lodging & Entertainment - 1.88%
*Brinker International .............................. 31,300 $ 708,162
McDonald's ......................................... 12,600 567,000
*Walt Disney ........................................ 20,000 557,500
----------
1,832,662
----------
Metals & Mining - 0.32%
Cleveland Cliffs Iron .............................. 10,640 311,220
----------
311,220
----------
Retail - 8.84%
*Dollar Tree Stores ................................. 14,400 644,400
*Federated Department Stores ........................ 16,400 771,825
Gap ................................................ 18,282 740,421
Home Depot ......................................... 20,300 1,604,969
Jostens ............................................ 23,350 429,056
Ross Stores ........................................ 23,230 446,452
*Safeway ............................................ 15,840 584,100
TJX ................................................ 15,480 405,383
Tupperware Corporation ............................. 7,200 128,250
Wal-Mart Stores .................................... 30,400 1,751,800
*Zales .............................................. 21,800 1,103,625
----------
8,610,281
----------
Telecommunications - 12.18%
AT & T ............................................. 32,695 1,826,833
Alltel ............................................. 15,800 1,366,700
BellSouth .......................................... 41,200 1,902,925
*MCI Worldcom ....................................... 16,400 1,356,075
Nortel Networks .................................... 13,400 991,600
SBC Communications ................................. 34,016 1,766,706
*Tellabs ............................................ 20,940 1,358,483
US West Communications Group ....................... 20,980 1,302,071
----------
11,871,393
----------
Textiles, Apparel & Furniture - 1.53%
Newell Rubbermaid .................................. 9,696 318,150
*Tommy Hilfiger ..................................... 25,400 625,475
Westpoint Stevens .................................. 26,200 550,200
----------
1,493,825
----------
Transportation & Shipping - 1.20%
*Alaska Air Group ................................... 4,100 155,800
Delta Air Lines .................................... 7,300 359,525
Tidewater .......................................... 9,500 303,406
*UAL Corporation .................................... 5,040 346,500
----------
1,165,231
----------
8
<PAGE>
Number of Market
Shares Value
- --------------------------------------------------------------------------------
Common Stock (continued)
Utilities - 1.87%
Centurytel .......................................... 18,750 $ 862,500
OGE Energy .......................................... 27,300 583,538
Utilicorp United .................................... 18,900 380,363
----------
1,826,401
----------
Total Common Stock (cost $81,395,192) ............... 96,735,938
==========
Principal
Amount
---------
Repurchase Agreements - 0.33%
With Chase Manhattan 5.64% 12/1/99
(dated 11/30/99, collateralized by $47,000
U.S. Treasury Notes 5.50% due 2/28/03,
market value $46,551 and $78,000
U.S. Treasury Notes 7.875% due 11/15/04,
market value $83,843) ............................. $127,000 127,000
With J.P. Morgan Securities 5.63% 12/1/99
(dated 11/30/99, collateralized by $54,000
U.S. Treasury Notes 5.50% due 3/31/03,
market value $53,136 and $47,000
U.S. Treasury Notes 6.25% due 2/15/03,
market value $47,893) ............................. 99,000 99,000
With PaineWebber 5.63% 12/1/99
(dated 11/30/99, collateralized by $101,000
U.S. Treasury Notes 5.50% due 1/31/03, market
value $100,941) ................................... 99,000 99,000
-----------
Total Repurchase Agreements
(cost $325,000) ................................... 325,000
===========
Total Market Value of Securities - 99.60%
(cost $81,720,192) ................................ $97,060,938
Receivables and Other Assets
Net of Liabilities - 0.40% ........................ 387,023
-----------
Net Assets Applicable to 7,573,100 Shares
($1 par value) Outstanding - 100.00% .............. $97,447,961
===========
Net Asset Value - Delaware Social
Awareness Fund A Class
($46,354,232 / 3,563,312 shares) .................. $13.01
======
Net Asset Value - Delaware Social
Awareness Fund B Class
($41,091,279 / 3,225,432 shares) .................. $12.74
======
Net Asset Value - Delaware Social
Awareness Fund C Class
($9,673,371 / 759,225 shares) ..................... $12.74
======
Net Asset Value - Delaware Social
Awareness Fund Institutional Class
($329,079 / 25,131 shares) ........................ $13.09
======
- ----------------------
* Non-income producing security for the year ended November 30,1999.
<PAGE>
- --------------------------------------------------------------------------------
Components of Net Assets at November 30, 1999:
Common stock, $1 par value, 200,000,000 shares authorized
to the Fund with 100,000,000 shares allocated to Delaware Social Awareness Fund
A Class, 25,000,000 shares allocated to Delaware Social Awareness Fund B Class,
25,000,000 shares allocated to Delaware Social Awareness Fund C Class,
and 50,000,000 shares allocated to Delaware Social
Awareness Fund Institutional Class .................. $81,027,227
Accumulated net realized gain on investments ........ 1,079,988
Net unrealized appreciation of investments .......... 15,340,746
-----------
Total net assets ..................................... $97,447,961
===========
Net Asset Value and Offering Price Per Share -
Delaware Social Awareness Fund ......................
Net asset value A Class (A) .......................... $13.01
Sales charge (5.75% of offering price or 6.07% of
amount invested per share) (B) ....................... 0.79
------
Offering price ....................................... $13.80
======
- ------------------
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon redemption or repurchase of shares.
(B) See the current prospectus for purchases of $50,000 or more.
See accompanying notes
9
<PAGE>
Statement of Operations
Delaware Group Equity Funds II
Year ended November 30, 1999
Delaware Social Awareness Fund
- --------------------------------------------------------------------------------
Year Ended 11/30/99
Investment Income
Dividends ............................................ $961,121
Interest ............................................. 115,205 $1,076,326
--------
Expenses:
Management fees ...................................... 706,897
Distribution expense ................................. 593,272
Dividend disbursing and transfer agent
fees and expenses ................................... 357,234
Registration fees .................................... 94,986
Reports and statements to shareholders ............... 79,500
Accounting and administration ........................ 30,874
Professional fees .................................... 18,588
Taxes (other than taxes on income) ................... 10,000
Custodian fees ....................................... 2,853
Trustees' fees ....................................... 1,675
Other ................................................ 38,786 1,934,665
-------- ----------
Less expenses absorbed or waived ..................... (166,274)
Less expenses paid indirectly ........................ (2,273)
----------
Total expenses ....................................... 1,766,118
----------
Net Investment Loss .................................. (689,792)
----------
Net Realized and Unrealized Gain
on Investments:
Net realized gain on investments ..................... 2,314,794
Net change in unrealized appreciation/depreciation
of investments ..................................... 10,745,101
----------
Net Realized and Unrealized Gain
on Investments ..................................... 13,059,895
----------
Net Increase in Net Assets Resulting From
Operations .......................................... $12,370,103
===========
See accompanying notes
10
<PAGE>
Statements of Changes in Net Assets
Delaware Group Equity Funds II
Delaware Social Awareness Fund
- --------------------------------------------------------------------------------
Year Ended
11/30/99 11/30/98
Increase (Decrease) in Net Assets from Operations:
Net investment loss .................................. $ (689,792) $ (104,394)
Net realized gain (loss) on investments .............. 2,314,794 (1,234,223)
Net change in unrealized appreciation/depreciation
of investments ...................................... 10,745,101 2,623,743
----------------------
Net increase in net assets resulting from operations . 12,370,103 1,285,126
----------------------
Distributions to Shareholders from:
Net realized gain on investments:
A Class ............................................ -- (38,406)
B Class ............................................ -- (30,948)
C Class ............................................ -- (5,476)
Institutional Class ................................ -- (414)
-----------------------
-- (75,244)
-----------------------
Capital Share Transactions:
Proceeds from shares sold:
A Class ............................................ 14,511,988 31,906,321
B Class ............................................ 13,994,716 24,847,840
C Class ............................................ 3,750,889 7,756,651
Institutional Class ................................ 309,395 516,088
Net asset value of shares issued upon reinvestment
of distributions from net realized gain on investments:
A Class ............................................ -- 35,864
B Class ............................................ -- 29,610
C Class ............................................ -- 5,197
Institutional Class ................................ -- 414
-----------------------
32,566,988 65,097,985
-----------------------
Cost of shares repurchased:
A Class ............................................(13,191,820) (3,123,666)
B Class ............................................ (7,945,146) (1,859,274)
C Class ............................................ (4,030,779) (390,664)
Institutional Class ................................ (413,514) (274,168)
-----------------------
(25,581,259) (5,647,772)
-----------------------
Increase in net assets derived from capital
share transactions .................................. 6,985,729 59,450,213
-----------------------
Net Increase in Net Assets ........................... 19,355,832 60,660,095
Net Assets:
Beginning of year .................................... 78,092,129 17,432,034
-----------------------
End of year ..........................................$97,447,961 $78,092,129
=======================
See accompanying notes
11
<PAGE>
Financial Highlights
Selected data for each share of the Fund outstanding
throughout each period were as follows:
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Delaware Social Awareness Fund A Class
Delaware Social Awareness Fund B Class
2/24/97(1) 2/24/97(1)
Year Ended to Year Ended to
11/30/99 11/30/98 11/30/97 11/30/99 11/30/98 11/30/97
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ................. $11.260 $10.330 $ 8.500 $11.120 $10.280 $ 8.500
Income (loss) from investment operations:
Net investment income (loss)(2)..................... (0.043) 0.015 0.007 (0.133) (0.066) (0.044)
Net realized and unrealized gain on investments .... 1.793 0.955 1.823 1.753 0.946 1.824
---------------------------------------------------------------------
Total from investment operations ................... 1.750 0.970 1.830 1.620 0.880 1.780
---------------------------------------------------------------------
Less distributions:
Distributions from net realized gain on investments -- (0.040) -- -- (0.040) --
---------------------------------------------------------------------
Total distributions ................................ -- (0.040) -- -- (0.040) --
---------------------------------------------------------------------
Net asset value, end of period ....................... $13.010 $11.260 $10.330 $12.740 $11.120 $10.280
=====================================================================
Total return(3) ...................................... 15.44% 9.52% 21.53% 14.57% 8.60% 20.94%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ............ $46,354 $38,858 $9,115 $41,091 $30,172 $6,919
Ratio of expenses to average net assets ............ 1.49% 1.45% 1.50% 2.24% 2.20% 2.20%
Ratio of expenses to average net assets prior to
expense limitation and expenses paid indirectly .. 1.69% 1.56% 1.96% 2.39% 2.26% 2.66%
Ratio of net investment income (loss) to average
net assets ....................................... (0.35%) 0.14% 0.38% (1.10%) (0.61%) (0.32%)
Ratio of net investment income (loss) to average
net assets prior to expense limitation and
expenses paid indirectly ......................... (0.55%) 0.03% (0.08%) (1.25%) (0.67%) (0.78%)
Portfolio turnover ................................. 28% 22% 29% 28% 22% 29%
</TABLE>
- ----------------------
(1) Date of commencement of operations; ratios have been annualized and total
return has not been annualized.
(2) The average shares outstanding method has been applied for per share
information.
(3) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
See accompanying notes
12
<PAGE>
Financial Highlights (continued)
<TABLE>
<CAPTION>
Selected data for each share of the Fund outstanding Delaware Social Awareness Fund
throughout each period were as follows: Delaware Social Awareness Fund C Class Institutional Class
- ------------------------------------------------------------------------------------------------------------------------------------
2/24/97(1) 2/24/97(1)
Year Ended to Year Ended to
11/30/99 11/30/98 11/30/97 11/30/99 11/30/98 11/30/97
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period .................... $11.120 $10.280 $ 8.500 $11.310 $10.350 $ 8.500
Income (loss) from investment operations:
Net investment income (loss)(2) ....................... (0.133) (0.068) (0.044) (0.012) 0.043 0.029
Net realized and unrealized gain on investments ....... 1.753 0.948 1.824 1.792 0.957 1.821
----------------------------------------------------------------------
Total from investment operations ...................... 1.620 0.880 1.780 1.780 1.000 1.850
----------------------------------------------------------------------
Less distributions:
Distributions from net realized gain on investments ... -- (0.040) -- -- (0.040) --
----------------------------------------------------------------------
Total distributions ................................... -- (0.040) -- -- (0.040) --
----------------------------------------------------------------------
Net asset value, end of period .......................... $12.740 $11.120 $10.280 $13.090 $11.310 $10.350
=====================================================================
Total return(3) ......................................... 14.57% 8.60% 20.94% 15.74% 9.70% 21.77%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ............... $9,673 $8,683 $1,290 $329 $379 $107
Ratio of expenses to average net assets ............... 2.24% 2.20% 2.20% 1.24% 1.20% 1.20%
Ratio of expenses to average net assets prior to
expense limitation and expenses paid indirectly ...... 2.39% 2.26% 2.66% 1.39% 1.26% 1.66%
Ratio of net investment income (loss) to average
net assets ........................................... (1.10%) (0.61%) (0.32%) (0.10%) 0.39% 0.68%
Ratio of net investment income (loss) to average
net assets prior to expense limitation and
expenses paid indirectly ............................. (1.25%) (0.67%) (0.78%) (0.25%) 0.33% 0.22%
Portfolio turnover .................................... 28% 22% 29% 28% 22% 29%
</TABLE>
- ----------------------
(1) Date of commencement of operations; ratios have been annualized and total
return has not been annualized.
(2) The average shares outstanding method has been applied for per share
information.
(3) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
See accompanying notes
13
<PAGE>
Notes to Financial Statements
November 30, 1999
Delaware Group Equity Funds II Delaware Social Awareness Fund
- --------------------------------------------------------------------------------
Delaware Group Equity Funds II (the "Company") is registered as a diversified
open-end investment company under the Investment Company Act of 1940, as
amended. The Company is organized as a Delaware Business Trust and offers five
series, the Delaware Decatur Equity Income Fund (formerly known as Decatur
Income Fund), the Delaware Growth and Income Fund (formerly known as the Decatur
Total Return Fund), the Delaware Blue Chip Fund, the Delaware Social Awareness
Fund and the Delaware Diversified Value Fund. These financial statements and
related notes pertain to the Delaware Social Awareness Fund (the "Fund"). The
Fund offers four classes of shares. The Delaware Social Awareness Fund A Class
carries a front-end sales charge of 5.75%. The Delaware Social Awareness Fund B
Class carries a back-end sales charge. The Delaware Social Awareness Fund C
Class carries a level load deferred sales charge and the Delaware Social
Awareness Fund Institutional Class has no sales charge.
The investment objective of the Fund is to achieve long-term capital
appreciation. It seeks to achieve this objective by investing primarily in
equity securities of medium to large-sized companies expected to grow over time
that meet the Fund's "Social Criteria" strategy.
1. Significant Accounting Policies
The following accounting policies are in accordance with generally accepted
accounting principles and are consistently followed by the Fund.
Security Valuation - Securities listed on an exchange are valued at the last
quoted sales price as of the close of the NYSE on the valuation date. Securities
not traded or securities not listed on an exchange are valued at the mean of the
last quoted bid and asked prices. Money market instruments having less than 60
days to maturity are valued at amortized cost, which approximates market value.
Other securities and assets for which market quotations are not readily
available are valued at fair value as determined in good faith by or under the
direction of the Fund's Board of Trustees.
Federal Income Taxes - The Fund intends to continue to qualify as a regulated
investment company and make the requisite distributions to shareholders.
Accordingly, no provision for federal income taxes has been made in the
financial statements. Income and capital gain distributions are determined in
accordance with federal income tax regulations, which may differ from generally
accepted accounting principles.
Class Accounting - Investment income, common expenses and realized and
unrealized gain (loss) on investments are allocated to the various classes of
the Fund on the basis of daily net assets of each class. Distribution expenses
relating to a specific class are charged directly to that class.
Repurchase Agreements - The Fund may invest in a pooled cash account along with
other members of the Delaware Investments Family of Funds. The aggregate daily
balance of the pooled cash account is invested in repurchase agreements secured
by obligations of the U.S. government. The respective collateral is held by the
Fund's custodian bank until the maturity of the respective repurchase
14
<PAGE>
- --------------------------------------------------------------------------------
agreements. Each repurchase agreement is at least 100% collateralized. However,
in the event of default or bankruptcy by the counterparty to the agreement,
realization of the collateral may be subject to legal proceedings.
Use of Estimates -- The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.
Other - Expenses common to all funds within the Delaware Investments Family of
Funds are allocated amongst the funds on the basis of average net assets.
Security transactions are recorded on the date the securities are purchased or
sold (trade date). Costs used in calculating realized gains and losses on the
sale of investment securities are those of the specific securities sold.
Dividend income is recorded on the ex-dividend date and interest income is
recorded on the accrual basis. The Fund declares and pays dividends from net
investment income and capital gains, if any, annually.
Certain expenses of the Fund are paid through "soft dollar" arrangements with
brokers. These transactions are done subject to best price and execution. The
amount of these expenses was $2,170 for the year ended November 30, 1999. In
addition, the Fund receives earnings credits from its custodian when positive
cash balances are maintained, which are used to offset custody fees. These
credits were $103 for the year ended November 30, 1999. The expenses paid under
the above arrangements are included in their respective expense captions on the
Statement of Operations with the corresponding expense offset shown as "Expenses
paid indirectly".
2. Investment Management and Other Transactions with Affiliates In accordance
with the terms of the Investment Management Agreement, effective April 1, 1999,
the Fund pays Delaware Management Company ("DMC"), the Investment Manager of the
Fund, an annual fee which is calculated daily at the rate of 0.75% on the first
$500 million of average daily net assets, 0.70% on the next $500 million, 0.65%
on the next $1,500 million, and 0.60% on the average daily net assets in excess
of $2,500 million. Prior to April 1, 1999, the Fund paid DMC an annual fee which
was calculated at the rate of 0.75% on the first $500 million of average daily
net assets of the Fund, 0.725% on the next $500 million and 0.70% on the average
daily net assets in excess of $1 billion. At November 30, 1999, the Fund had a
liability for Investment Management fees and other expenses payable to DMC of
$71,568.
DMC has entered into a sub-advisory agreement with Vantage Investment Advisors,
Inc., an affiliate of DMC, with respect to the management of the Fund. For the
services provided to DMC, DMC pays the sub-adviser an annual fee which is
calculated at the rate of 0.15% of average daily net assets averaging one year
old or less, 0.20% of average daily net assets averaging two years old or less
but greater than one year and 0.35% of average daily net assets averaging over
two years old. The Fund does not pay any fees to the sub-adviser.
<PAGE>
Notes to Financial Statements (continued)
- --------------------------------------------------------------------------------
DMC has elected to waive the portion, if any, of the management fee and
reimburse the Fund to the extent that annual operating expenses, exclusive of
taxes, interest, brokerage commissions, extraordinary expenses and distribution
expenses, exceed 1.25% of average daily net assets of the Fund through January
31, 2000. Prior to February 1, 1999, the expense limitation was 1.20% of the
Fund's average daily net assets.
The Fund has engaged Delaware Service Company, Inc. ("DSC"), an affiliate of
DMC, to provide dividend disbursing, transfer agent and accounting services. The
Fund pays DSC a monthly fee based on the number of shareholder accounts,
shareholder transactions and average net assets, subject to certain minimums. At
November 30, 1999, the Fund had a liability for such fees and other expenses
payable to DSC of $23,223.
Pursuant to the Distribution Agreement, the Fund pays Delaware Distributors,
L.P. ("DDLP"), the Distributor and an affiliate of DMC, an annual fee not to
exceed 0.30% of the average daily net assets of the A Class and 1.00% of the
average daily net assets of the B and C Class. For the period from February 1,
1999 through July 31, 2000, DDLP has elected to waive its fees to ensure that
annual fees received from A Class do not exceed 0.25% of the average daily net
assets of A Class. At November 30, 1999, the Fund had a liability for
distribution fees and other expenses payable to DDLP of $15,481.
For the year ended November 30, 1999, DDLP earned $62,610 for commissions on
sales of the Fund A Class shares.
Certain officers of DMC, DSC and DDLP are officers, trustees and/or employees of
the Fund. These officers, trustees and employees are paid no compensation by the
Fund.
3. Investments During the year ended November 30, 1999, the Fund made purchases
of $34,695,167 and sales of $25,900,929 of investment securities other than U.S.
government securities and temporary cash investments.
At November 30, 1999, net unrealized appreciation for federal income tax
purposes aggregated $15,340,746 of which $24,346,048 related to unrealized
appreciation of securities and $9,005,302 related to unrealized depreciation of
securities.
At November 30, 1999, the aggregate cost of securities for income tax purposes
was $81,720,192.
<PAGE>
- --------------------------------------------------------------------------------
4. Capital Stock
Transactions in capital stock shares were as follows:
Year Ended Year Ended
11/30/99 11/30/98
Shares sold:
A Class ...................................... 1,181,319 2,847,821
B Class ...................................... 1,164,562 2,213,593
C Class ...................................... 308,899 691,454
Institutional Class .......................... 24,716 48,074
Shares issued upon reinvestment of
distributions from net realized gain
on investments:
A Class ...................................... -- 3,485
B Class ...................................... -- 2,897
C Class ...................................... -- 509
Institutional Class .......................... -- 40
--------- ---------
2,679,496 5,807,873
--------- ---------
Shares repurchased:
A Class ...................................... (1,068,001) (283,314)
B Class ...................................... (653,313) (175,560)
C Class ...................................... (330,699) (36,492)
Institutional Class .......................... (33,067) (24,987)
---------- ---------
(2,085,080) (520,353)
---------- ---------
Net increase 594,416 5,287,520
========== =========
5. Lines of Credit
The Fund has a committed line of credit for $3,400,000. No amount was
outstanding at November 30, 1999, or at any time during the fiscal year.
15
<PAGE>
Report of Independent Auditors
- --------------------------------------------------------------------------------
To the Shareholders and Board of Trustees
Delaware Group Equity Funds II - Delaware Social Awareness Fund
We have audited the accompanying statement of net assets of Delaware Social
Awareness Fund (the "Fund") as of November 30, 1999, and the related statement
of operations for the year then ended, the statements of changes in net assets
for each of the two years in the period then ended, and the financial highlights
for each of the periods indicated therein. These financial statements and
financial highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements and financial highlights. Our procedures included confirmation of
securities owned as of November 30, 1999, by correspondence with the custodian
and brokers. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Delaware Social Awareness Fund at November 30, 1999, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended, and its financial highlights for each of
the periods indicated therein, in conformity with generally accepted accounting
principles.
/s/ Ernst & Young LLP
--------------------------
Philadelphia, Pennsylvania Ernst & Young LLP
January 7, 2000
16
<PAGE>
DELAWARE INVESTMENTS FAMILY OF FUNDS
Complete information on any fund offered by Delaware Investments can be found in
each fund's current prospectus. Prospectuses for all funds offered by Delaware
Investments are available from your financial adviser. Please read the
prospectus carefully before you invest or send money.
[GRAPHIC OMITTED: BUILDING BLOCKS OF A DIVERSIFIED PORTFOLIO "HOUSE"]
Building Blocks of a Diversified Portfolio
GROWTH OF CAPITAL
Aggressive Growth Equity Funds
Growth Equity Funds
o Select Growth Fund
o Trend Fund
o DelCap Fund
o Small Cap Value Fund
o U.S. Growth Fund
o Growth Stock Fund
o Tax-Efficient Equity Fund
o Social Awareness Fund
TOTAL RETURN
Moderate Growth Equity Funds
o Blue Chip Fund
o Devon Fund
o Growth and Income Fund
o Decatur Equity Income Fund
o REIT Fund
o Balanced Fund
INTERNATIONAL AND GLOBAL
International and Global Funds
o Emerging Markets Fund
o New Pacific Fund
o Overseas Equity Fund
o International Equity Fund
o Global Equity Fund
o Global Bond Fund
CURRENT INCOME
Taxable Bond Funds
o Delchester Fund
o High-Yield Opportunities Fund
o Strategic Income Fund
o Corporate Bond Fund
o Extended Duration Bond Fund
o American Government Bond Fund
o U.S. Government Securities Fund
o Limited-Term Government Fund
<PAGE>
TAX-EXEMPT INCOME
Tax-Exempt Bond Funds
o National High-Yield Municipal Bond Fund
o Tax-Free USA Fund
o Tax-Free Insured Fund
o Tax-Free USA Intermediate Fund
o State Tax-Free Funds*
STABILITY OF PRINCIPAL
Stability of Principal
o Cash Reserve
o Tax-Free Money Fund
ASSET ALLOCATION
Asset Allocation Funds
(varying levels of income and growth potential)
o Foundation Funds
Growth Portfolio
Balanced Portfolio
Income Portfolio
*Available for the following states: Arizona, California, Colorado, Florida,
Idaho, Iowa, Kansas, Minnesota, Missouri, Montana, North Dakota, New Jersey,
New Mexico, New York, Ohio, Oregon, Pennsylvania and Wisconsin. Insured and
Intermediate Funds are available in selected states.
<PAGE>
DELAWARE(SM)
INVESTMENTS
- ---------------------
Philadelphia o London
For Shareholders
1.800.523.1918
For Securities Dealers
1.800.362.7500
For Financial Institutions
Representatives Only
1.800.659.2265
www.delawareinvestments.com
This annual report is for the information of Delaware Social Awareness Fund
shareholders, but it may be used with prospective investors when preceded or
accompanied by a current Prospectus for Delaware Social Awareness Fund and the
Delaware Investments Performance Update for the most recently completed calendar
quarter. The prospectus sets forth details about charges, expenses, investment
objectives and operating policies of the Fund. You should read the prospectus
carefully before you invest. The figures in this report represent past results
which are not a guarantee of future results. The return and principal value of
an investment in the Fund will fluctuate so that shares, when redeemed, may be
worth more or less than their original cost.
................................................................................
BOARD OF TRUSTEES
Wayne A. Stork
Chairman
Delaware Investments Family of Funds
Philadelphia, PA
Walter P. Babich
Board Chairman, Citadel Constructors, Inc.
King of Prussia, PA
David K. Downes
President and Chief Executive Officer
Delaware Investments Family of Funds
Philadelphia, PA
John H. Durham
Private Investor
Horsham, PA
Anthony D. Knerr
Consultant, Anthony Knerr & Associates
New York, NY
Ann R. Leven
Former Treasurer, National Gallery of Art
Washington, DC
Thomas F. Madison
President and Chief Executive Officer
MLM Partners, Inc.
Minneapolis, MN
<PAGE>
Charles E. Peck
Retired
Fredericksburg, VA
Jan L. Yeomans
Vice President and Treasurer
3M Corporation
St. Paul, Minnesota
AFFILIATED OFFICERS
Richard J. Flannery
Executive Vice President and
General Counsel
Delaware Investments Family of Funds
Philadelphia, PA
Bruce D. Barton
President and Chief Executive Officer
Delaware Distributors, L.P.
Philadelphia, PA
Investment Manager
Delaware Management Company
Philadelphia, PA
International Affiliate
Delaware International Advisers Ltd.
London, England
Subadviser
Vantage Investment Advisors, Inc.
New York, NY
National Distributor
Delaware Distributors, L.P.
Philadelphia, PA
Shareholder Servicing, Dividend
Disbursing and Transfer Agent
Delaware Service Company, Inc.
Philadelphia, PA
1818 Market Street
Philadelphia, PA 19103-3682
Printed in the USA
(2527)
AR-147 [11/99] PPL 1/00 (J5434)
